Currently City bankers aren't too worried. David Cameron and George Osborne claim they will not sign up to a Tobin Tax unless such a tax is adopted worldwide, which is highly unlikely to happen, for the moment. Although Washington has made several moves to tighten up corporate behaviour, on-the-ground support for a Tobin Tax in the US (and in the places that matter) is not there.
But it's a fairly passive-aggressive stance to the idea. Instead, Cameron and Osborne could go to the G20 to advocate its take up, attempt to persuade other leaders of its benefits - which are potentially huge. Apart from the sheer amount of money it could raise - hundreds of billions - it could also cut stock market volatility, dissuading short-term speculation.
Hypocisy?The benefits of a levy - it's a levy on activity, not profits - are well publicised. But it's the attitude that counts. Osborne, in thrall to the City, is terrified of being seen to do anything that might soften the CIty's hard edge. But the City's influence is so entrenched, a tiny 0.05% tax on transactions is unlikely to smother it, even slightly.
Now that the Archbishop of Canterbury has weighed in on the issue - as has the Pope - then Cameron, Osborne and the US may find it increasingly difficult to argue the case against a tax. (Merkel is for it, as is Sarkozy.)
But yesterday we saw evidence - Osborne had sent bank chiefs a letter expressing private doubt about the implementation of such a tax - that despite the talk of government support for a global tax, in reality, the will isn't there. Public words versus what is really thought in private.
MisjudgementBut Cameron and Osborne may have misjudged the issue, not to mention the public mood. The St Paul's protestors have made a real impact, forcing the Church to evaluate its relationship with the City of London and very publicly.
George Soros, Bill Gates and others support the idea of a Tobin Tax. They are not naive, anti-capitalist idealists. They want the banks to pay their way more effectively. So the Church is talking sense, finally, and - whoever would have thought it? - putting Conservative politicians on the spot.