Krugman says Timmy G is on Wall Street's payroll

Don't blame the messenger (link):

.... the Turner-Brown proposal, which would apply a “Tobin tax” to all financial transactions — not just those involving foreign currency — is very much in Tobin’s spirit. It would be a trivial expense for long-term investors, but it would deter much of the churning that now takes place in our hyperactive financial markets. This would be a bad thing if financial hyperactivity were productive. But after the debacle of the past two years, there’s broad agreement — I’m tempted to say, agreement on the part of almost everyone not on the financial industry’s payroll.

and yet....

Unfortunately, United States officials — especially Timothy Geithner, the Treasury secretary — are dead set against the proposal.

 As to substance:  it's taken a while but kudos for finally picking up on this. Better late than never, I suppose. But, Mr. Krugman, I urge you to do more – because the reform of our financial sector is very, very important, and a Tobin tax is an easy-to-implement first step that should reduce this endless trading activity that brings little tangible accomplishment.

So write about how HFT/algo trading is now dominating our exchanges. Write how many transactions are done through "dark pools". Write how all of these split-second trades that are managed by computer models have the capability to rapidly inflate (and deflate) bubbles in stocks, oil, metals, currencies, credit swaps and anything and everything for which a symbol exists on the Bloomberg terminal. Write how formation of the bubbles has been ever more rapid and ever more frequent thanks to the sloshing liquidity in financial markets. Write how the injections of monetary stimulus would, in the ordinary course of affairs, result in more permanent allocation of capital to socially useful projects with long term returns (infrastructure, energy, biotech, etc.), and yet because finding such socially useful investments requires hard work, have instead ended up fueling the rapid rise of the financial sector. Write about why the foregoing results in a complete abdication of Wall Street's raisón d'etré: efficient allocation of capital.

Write incessantly, because (a) persistence pays off, and (b) if the message has any hope of getting accross, it must saturate the consiosness of those who pay attention and our powers that be. You have an unparalleled forum to air your views and an air of authority to boot – use it!