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By Bernie Becker - 11/06/11 01:00 PM ET
A group of congressional Democrats is pushing on with their efforts to enact a tax on financial transactions, in the face of what they acknowledge are long odds.
The financial transactions tax has prominent supporters in Europe, including President Nicolas Sarkozy of France and Chancellor Angela Merkel of Germany.
But the Obama administration has decided against embracing the idea, most recently at a meeting of the Group of 20 nations in France. Meanwhile, Republicans on Capitol Hill remain opposed to tax increases, and banking and financial advocacy groups are also fiercely against the transaction tax.
Democrats backing the idea are well aware of those roadblocks. But they also say the transaction tax, which has also been endorsed by Bill Gates, would both help raise revenue to tackle deficits and rein in speculation in the financial world.
“The Republican majority will decide whether we take this bill up or it passes,” said Peter Welch (D-Vt.). “But it’s kind of hard to defend some of the conduct.”
Under the proposal introduced by Rep. Peter DeFazio (D-Ore.) and Sen. Tom Harkin (D-Iowa), trading of stocks, bonds and certain other transactions would be hit with a tax of three basis points – or, essentially, a tax of .03 percent per trade.
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