Three years into the nation’s brutal recession, America’s workers continue to suffer from massive joblessness, skyrocketing foreclosures and weak buying power. But Wall Street—with corporations sitting on $2 trillion in cash—hasn’t paid for its role in causing the near-collapse of the U.S. economy. 

The European Union (EU) this week moved to change that, with the EU formally adopting plans for a financial speculation tax that would raise 57 billion euros a year. The tax could generate billions in revenue to help our ailing economy, stimulate job growth and discourage the reckless, high-volume/short-term profit, computer-driven Wall Street gambling that led to our current economic crisis.

While the EU proposal still needs unanimous approval from EU states, there has been no legislative movement to do the same in this country. As economist Dean Baker notes, “the intensity with which the country’s leading deficit hawks continue to ignore financial speculation taxes (FST) is getting ever more entertaining.”

While deficit hawks like Wall Street investment banker[s]…never tire of preaching the virtues of shared sacrifice, somehow sacrifice for Wall Street never features as part of this story.

Baker also points out the media’s role in failing to report on Wall Street’s role in relentless pushing to reduce the deficit.

What is most remarkable in this picture is the complete failure of the media to identify Wall Street’s role in pushing this deficit reduction agenda. For example, Erskine Bowles, who was a co-chair of President Obama’s deficit commission, is never identified as a director of Morgan Stanley.

In this country, the National Nurses United (NNU) has been especially out front in demanding Wall Street pay for creating the global economic meltdown, in part through a financial speculation tax, a move the AFL-CIO and the global union movement long have been calling for.

Paradoxically, if reducing the deficit is such a high priority, why isn’t a financial spec tax on the agenda? Baker thinks he knows why.

In short, it is hard to understand why taxing financial speculation never appears on the agenda of the deficit hawks or gets mentioned in budget reporting, if the issue really is deficit reduction. On the other hand, if this is all about using an economic crisis to push a longstanding agenda to cut Social Security and Medicare, then everything suddenly makes sense.