Some awful ideas just keep turning up.

Take, for example, the old state and city stock transfer tax.  The last vestiges of the tax were effectively phased out in 1981, although its ghostly shadow technically survives due to a weird tax law quirk whose repeal has been urged by, among others, the state Bar Association.

For years, organized labor advocates in New York have been pushing a revival of the stock transfer tax.  But the idea is so palpably anti-competitive and economically destructive that it has gotten nowhere, although the Working Families Party did persuade a majority of the New York City Council to endorse the concept.

More recently, the national AFL-CIO has been pushing a federal stock transaction tax of 0.10 to 0.25 percent.   The Hill this week reports that House Democratic leaders are considering the idea as a way to finance a new “jobs bill” or a second stimulus whose details remain murky.

In some quarters, the stock transfer tax is a two-fer: it punishes Wall Street and raises more cash for income redistribution through government spending targeted at labor cartels.  What more can you ask for?

If the idea is going to get anywhere, expect to hear more about it early next month.  According to The Hill:

The administration announced last week that it would hold a jobs summit, specifying … that the summit will take place on Dec. 3.

Obama will follow that event with a trip to Allentown, Pa., for a forum on jobs, part of a “Main Street tour” announced by the White House, in which Obama will travel to a number of cities and towns over the next few months.

Uh-oh.

Speaking of a job creation, a cost-effective alternative to the reigning stimulus approach is outlined in today’s Wall Street Journal by Michael Boskin of the Hoover Institution and Stanford University, who chaired the Council of Economic Advisaors under President George H. W. Bush.

Boskin, citing analysis by two other economists, says a six percentage point cut in the 12.4 percent Social Security payroll tax “would, under standard assumptions, increase employment by three million to four million workers—an amount equal to all the job losses since the stimulus was passed.”

He adds:

The payroll tax cut would have reduced firms’ costs by roughly the same amount as from the entire decline in employment. It would have cost less than half as much as the stimulus bill, gotten far more income into paychecks quickly and, most importantly, greatly reduced incentives for firms to lay off workers. In fact, it would have created incentives to hire.

The concept is pretty simple: in a capital-starved environment, especially for small firms, encourage hiring by making workers cheaper.

Unfortunately—and speaking of bad ideas that just won’t go away—Governor Paterson is reportedly about to move in the opposite direction by proposing expansion of the state prevailing wage law to a wider range of economic development projects.   Now that ought to do wonders for employment in New York.