It’s easy to understand why the European Union wants to slap a tax on financial companies when they buy or sell stocks, bonds, and derivatives. Europe is still grappling with fallout from a global recession triggered by the financial industry’s recklessness. And oh yes, there’s that $40 billion in revenue that the tax is estimated to raise.
Sweet revenge? Bitter disappointment is more likely. Earlier attempts to tax financial transactions have spectacularly failed to meet revenue expectations, as trading activity simply moved abroad.