A tax that’s been proposed since the early 1970s is growing closer to becoming a reality.

Governments are stacking on more debt all the time, and they’re looking for all the nickels under the couch cushions they can find. The only problem is, the couches they’re looking in belong to us.

Back in 1971, a U.S. economist named James Tobin suggested that currency trading be taxed to deter speculation after we had just left the gold standard.

This past weekend the G-20 met in St. Andrews, Scotland, and part of their talk was about just that — taxing trading transactions, even more specifically currency transactions.

None other than British Prime Minister Gordon Brown led the charge on that one. French President Nicolas Sarkozy has been chanting this for a while, too, as has been Callum McCarthy, the UK chairman of the Financial Services Authority.

I’m sure the fee would be small at first, much like an SEC fee on stock transactions. However, they are looking to mandate more and more money from you and me.

It’s amazing to me that they can instantly create another revenue stream for themselves anytime they outspend themselves. When they do this, you and I pay for it.

Imagine if every time I spent more than my paycheck, I got to come and break into your house and steal your money to pay my bills with. That’s what it feels like to me when they are able to jack up the taxes on us for no good reason.

Sure, the G-20 has its reason. I just said, “no good reason.”

The G-20 says that if trading was taxed more heavily, that would deter speculation which it says is the cause for market bubbles.

That’s always so laughable to those of us who know markets. There aren’t enough traders in the world to get on board and force a trend and then hold it up for excessive lengths of time.

However, you can enact crazy government policies, and that can cause bubbles big time.

For instance, the government blames the oil bubble and housing bubbles on speculators. Yet, was it the speculators who took interest rates down to 1 percent and held them there for an unusually long period of time? Or was it Alan Greenspan and Company who was responsible for this? I’ll go with the latter.

That, my friend, has a heck of a lot more to do with bubbles than what traders do. Real traders know that they don’t create trends, they just follow them.

So, when you make money cheap and easily accessible like the Federal Reserve and Treasury have, and it causes the prices of assets to run up, all of a sudden the traders are the scapegoats because, according to the government, it does nothing wrong.

While this additional trader tax won’t happen tomorrow, be sure that the G-20 will get this additional government income stream from taxing trading once more.

Brazil already seems to think so, and that’s why it’s imposed a 2 percent tax on foreign purchases of equities and fixed-income securities. This is why I say, the day is nearing when governments will tax your currency transactions and get more money out of you.

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