Tobin tax

A news item about the possible introduction of a Tobin tax (aka "Robin Hood" tax). It's mildly frustrating in these kind of discussions that they never consider the financial system from a cybernetics perspective.

The financial system as we know it now is a bit like steam engines prior to use of mechanical governors. There's nothing to damp out fluctuations or prevent the whole system from blowing up. Transaction taxes levied on each trade could provide the principal mechanism which really does make boom and bust economics a thing of the past - or at least turn tidal waves into minor ripples.

It's probably true that there will always be speculators making speculative trades in this or that, and that sometimes these trading decisions will be bad, based upon superstition, faulty information, the vagaries of fashion or bad maths.  Occasionally such bad decisions will compound according to positive feedback to generate a bubble. But the financial system is not a force of nature outside of our influence. It's an artificial system devised by humans, and as such can be subject to the moderating influences of laws, regulations, taxes and so on.  We don't have to become victims of our own limited outlook or tendency to follow the latest fad, and I expect that future generations will look back on the economic booms and collapses of the past with a combination of amusement and horror.