Subject: Automated Financial Transaction Tax Comment: For a number of years I have been studying the feasibility of a fundamental change in the manner in which government derives the revenues essential to its proper functioning. At present, all government, whether federal, state or local, all cling precariously on the edge of insolvency, caught between the demands of major groups of citizens for services and of other major groups for relief from the burdens of taxation. And governments's universal responses have been to rely more and more on tax free bonds--a sure formula for insolvency. Two plans have been submitted to you that will resolve this dilemma: Representative Chaka Fattah's Transform American plan, and the Automated Financial Transaction Tax plan of Wisconsin economic's professor E. L. Feige. I submit that you should recommend that the President endorse the essence of these plans, which is a universal and incrementally small financial transaction tax collected automatically by computer, such as the SEC presently taxes stock market trades. This tax, we submit, should be introduced into the stream of commerce and finance in stages, commencing with the securities transaction tax, to avoid major disruptions in the economy and revenue stream, with the proceeds being dedicated to the reduction of our National Debt until the Income Tax is phased out or eliminated. |