This idea sounds more and more rational.
http://www.nytimes.com/2009/11/27/opinion/27krugman.html?th&emc=th
Krugman states that the concept was first proposed by the Nobel-winning Yale economist James Tobin in 1972. I first heard of the concept in the go go 90's when Micheal Beltz proposed it to me for just the same reasons as Krugman points out:

"Such a tax would be a trivial expense for people engaged in foreign trade or long-term investment; but it would be a major disincentive for people trying to make a fast buck (or euro, or yen) by outguessing the markets over the course of a few days or weeks. It would, as Tobin said, “throw some sand in the well-greased wheels” of speculation....

This would be a bad thing if financial hyperactivity were productive. But after the debacle of the past two years, there’s broad agreement — I’m tempted to say, agreement on the part of almost everyone not on the financial industry’s payroll — with Mr. Turner’s assertion that a lot of what Wall Street and the City do is “socially useless.” And a transactions tax could generate substantial revenue, helping alleviate fears about government deficits. What’s not to like?"

Sounds like a good idea to me.