A Tobin Tax (or “Robin Hood” tax) would be a horrible idea, for numerous reasons. For the simplicity of debate, I will narrow it down to two main objections, along the lines of what a tax does: 1) move resources from the private sector to the public sector, and 2) discourages activity/economic behavior/types of transactions by increasing the costs.
First, a Tobin Tax would disincentivize speculation by increasing the cost; even at 0.005%, it stills increases the cost of the transaction and changes the perceived profitability of a trade. If a bank is trading a billion dollars a day, that’s $1,000,000 in taxes - and a million dollars certainly isn’t pocket change.
In your post, you call currency and share speculation “socially useless”, and the website you cited states that “too much trading is done to make a quick profit, and not to serve the real economy.” I would like to counter with the offer that speculation is not only socially useful, but it is indeed absolutly vital and critical to the health of an economy, and that any time an honest profit is made (IE, the profit does not occur through the use of fraud) it does indeed serve to benefit the economy.
Currency and shares are like any other tangible commodity bought or sold on a market when it comes to speculation; it doesn’t matter if the speculator is buying grain, fruit, oil, or gold, pounds, euros, yen, or dollars, or shares in IBM, Microsoft, Apple, or Wal-Mart. They are buying the commodity because they believe that, in the future, it will be worth more than it is worth now. Unlike the tangible goods, without speculation intangibles like shares and currency would have no worth. What use do I, as someone living outside of the EU, have for a Euro? None of the local stores will take it, I can’t buy gas with it, I certainly can’t eat it or make something useful out of it. Unless I plan on moving, the only reason I (or a bank) would have for buying euros is because I think I could make more money that way than by using my dollars for something else.
The entire reason people provide capital for a corporation’s initial public offering is because they expect that the shares they buy will be worth more in the future - speculation. People are willing to buy shares from stockholders who want out of a company because, again, they feel they can buy the share now for less than it will be worth at a later date - speculation. Governments are able to fund their operations through bonds and treasury bills because of speculation - other entities (individuals/banks/foreign countries) buy the cash instruments and provide money to the government because they feel that buying a sum of dollars (or pounds, euros, or marks) will provide a return on their investment. Speculation provides cash liquidity and helps to normalize the supply.
Speculation can also provide signals on the expected future results of present day actions. If a company is doing something bone-headed and stupid, their stock price will plummet as people recognize the error. The falling stock price gets the investors riled up, who demand a change in the company and avert the future disaster. Government bonds and currency prices work the same way - when the United States government passed legislation that would dramatically increase business expenses in a few years, stock prices fell in response to the expectation of a decrease in future value, and voters were riled up and demanding to know what the government was doing to the security of their future pensions.
Second (and this applies to most taxes in general), the Tobin Tax assumes that the government will be a better steward of the nation’s resources than the individual consumers who are participating in the economy. Yes, the Tobin Tax is levied specifically on one small subset of economic transactions and targetted against a specific section of the economy (the financial/banking sector), but a nation’s economy is a flexible, elastic thing and not a zero-sum game.
For example, corporations do not really “exist”; they are there simply because we pretend they are. When someone talks about Goldman Sachs, there isn’t an entity there they can go talk to - the company is meerly a collection of stockholders and employees. Hence, any tax levied against a corporation is really being paid for by individual citizens - either the stockholders (in the reduced worth of their stock), the employees (the company may have to lay off workers or postpone raises to pay for the taxes instead), or the individuals who do business with the company - increased costs passed on to the consumers, or less money being sent back into the economy through the company’s vendors. Thus, a ‘small’ tax on a ‘small, tightly defined’ section of the economy still has the ability to impact everyone.
Returning to the main point, again, it assumes that the government can do a better job distributing the money than you can. If the bank decides to increase its fees to offset the cost of the tax and you end up paying an extra $10 a year, and the government dedicates that money to “fighting poverty”, that has the same effect as the government ordering you to give $10 to your local food bank because the government knows that is the best use of your money, regardless of what your plans for it were. And, of course, the government is an inefficient bureaucracy - between the costs of enforcing the taxes, paying the tax collector, paying however many administrators and clerks it takes to run their program, and finally giving what’s left to the program, that $10 you hand out might turn into $6 for the food bank and $4 for the government employees. For this reason, I consider any taxes beyond the bare minimums to run a country to be an inefficient waste, and taxes on specific things/people are morally unjust, fraudulent representations by the government.
A further consideration that is frequently ignored by governments is the opportunity cost of moving resources out of the private sector: that is, what would you have done with your $10 if the government hadn’t demanded it be spent a certain way? At the website, it says that one one minute, the Tobin Tax could raise enough money to build a six-room schoolhouse for 250 students. What if the bank had wanted to loan that money to someone starting a small business? What if it had been earmarked for a number of first-time homebuyers who can’t get a loan for the homes they want now? What if it means an inventor can’t find funding for a revolutionary new invention?