Some things are conspicuous by their absence and the deafening silence that greeted Lord Turner’s call for a Tobin tax last week from the political left, sadly rates as one of them.

The end of the political holiday season might be argued to be an excuse for this absence of support. But after a savage year for the left of infighting, loss of support in the polls, and being led by the political agenda rather than driving it, this failure to force a wider debate on a Tobin tax seems like a missed opportunity.

For those of you pouring the sand out of your suitcases who may have missed the story in Prospect magazine, Adair Turner, who is head of the UK bank regulator, the Financial Services Authority, has called for a levy on foreign exchange transactions. This is seen as a potential means to curb the excessive bonus culture in banking that played a massive part in bringing about the ongoing global economic crisis.

He said “If you want to stop excessive pay in a swollen financial sector you have to reduce the size of that sector or apply special taxes to its pre-remuneration profit. Higher capital requirements against trading activities will be our most powerful tool to eliminate excessive activity and profits.

“And if increased capital requirements are insufficient I am happy to consider taxes on financial transactions – Tobin taxes.”

Tobin taxes, named after the 20th Century American economist James Tobin who created the idea, is a proposal for a small tax to be applied globally – between 0.1 and 0.25 percent – on every international currency exchange transaction. This would generate revenue for the operation of stronger global regulatory institutions, the reasons for Lord Turner’s support, as well as “a nice sensible revenue source for funding global public goods” as he went on to say.

For further details on how the economic crisis has rejuvenated calls for the Tobin tax, I would advise you towards the excellent article by Larry Elliot in the Guardian ‘the time is ripe for a tobin tax’. Suffice to say that from an economic and policy perspective, in light of this unprecedented global economic crisis, the arguments for such a tax are robust, especially if other means fail. So this begs the question, why is it not from a political perspective?

On Tuesday (September 1), the Labour Prime Minister Gordon Brown in an interview with the Financial Times, stated that banks should be able to “claw back” bonuses if the bank later performed poorly. However, he declined to support the words of Lord Turner. Earlier in the week the Treasury, under Labour Chancellor Alistair Darling, also distanced itself from Lord Turner’s comments.

Traditionally the idea of Labour rejecting –or at worst not calling for a debate- on a proposal like the Tobin tax, would be unthinkable. However, under ‘New Labour’, such a move currently seems par for the course and this is a perfect example of why the New Labour project or progressivism is failing.

Failing, not because of the aims of progressives to balance a strong economy with social justice and egalitarian arguments. But rather because of an inability to be able to still discern what such policy ideas really look like. It seems that after the triangulation of Blair and moral compass of Brown, Labour has strayed up an alley from which it does not know where to go or how to find the public again.

In fact, the Tobin Tax was almost prophetically described in a recent August Tribune article calling for the rejuvenation of the Labour Party by David Miliband –for many the heir apparent to the progressive movement. He said that “the next general election will be the first of the global age” and that “Our [Labour’s] challenge is to sustain and spread forces of individual empowerment more equally, while enhancing rather than reducing capacity for collective action to tackle shared risks.”

The Tobin tax’s ability to strengthen the economy through its means to supply funds to strengthen regulation and curb dangerous excess; combined with the “global public goods” that it can provide, is surely something for progressives to champion.

And, these goods are numerous. For example, a wider application of regulation could see funds used to pay for the proper enforcement of worker rights in developing countries too worried to currently do so by the feared loss of potential business from multinational organisations moving their supply chains. Further down the line, once the idea had become more accepted, parts of the funds generated could also be used for an ongoing fund for disaster relief (an idea actually advocated by Republican Congressman Chris Smith at an international conference following the Asian Tsunami disaster), especially with disasters becoming more common place through the effects of climate change. Generation of funds to alleviate poverty is also an option, much in the same way as debt relief.

Arguments that a scheme such as a Tobin tax is unworkable do not float when matched up to the previous example of debt relief. For decades debt relief was seen as a utopian ideal rather than a realistic proposal. But political will was all that was needed, with the drive of politicians like Blair and Brown pushing debt relief through the G8 with memorable agreements such as at Gleneagles.

The left needs to recapture some of that boldness and belief in its ideals, as was demonstrated with debt relief, if it is to reconvince the public that it has a true vision for the 21st century. A debate on the Tobin tax seems like the perfect start.

With the political conference season ahead, this proposal of a Tobin tax should be debated to push forward the progressive agenda. Failure to do so would be another chance lost for Labour to save itself from an ever-approaching political wilderness.