"And anyway, if there's one thing banks are great about, it's passing on the fees to their clients. A one cent per-share transfer tax doesn't mean Wall Street is out of business. It means you won't have enough money in your 401k to retire."
While I agree with the rest of your criticisms, this is off base. You have to consider the second-order effects; banks will not simply continue to trade at the exact same volume as before whatever (presumably somehow fixed-up) tax is imposed, then pass the costs on to hapless consumers who have no choice but to just fork over the cash. They will have to trade less. Which is the point; however good or bad it may be, at least the core idea is making some account of second-order effects. When you tax a thing, you get less of it.
(My specific opinion is that it isn't necessarily a net gain as written, it is after all just an HN comment, but that the general idea of carefully re-inserting some friction back into the market as a damping factor may be a useful line of inquiry. But it's not going to be easy.)
While I agree with the rest of your criticisms, this is off base. You have to consider the second-order effects; banks will not simply continue to trade at the exact same volume as before whatever (presumably somehow fixed-up) tax is imposed, then pass the costs on to hapless consumers who have no choice but to just fork over the cash. They will have to trade less. Which is the point; however good or bad it may be, at least the core idea is making some account of second-order effects. When you tax a thing, you get less of it.
(My specific opinion is that it isn't necessarily a net gain as written, it is after all just an HN comment, but that the general idea of carefully re-inserting some friction back into the market as a damping factor may be a useful line of inquiry. But it's not going to be easy.)