Don't Slap a New Tax on High-Frequency Trading

Demonizing the financial industry has proven to be a political winner. Exposure of the evil banks was followed by Michael Lewis's exposé of the markets in Flash Boys. The markets are rigged, we are told, by high-frequency traders (HFTs) who are a bunch of tech-savvy parasites.1 The banks have been thoroughly chastened by Washington politicians and now it is the turn of the markets with more to come in the way of fines, regulations, and punitive taxation in the form of a financial transaction tax.