The upshot: "Based on the vast majority of the empirical work to date, HFT and automated,competing trading venues have substantially improved market liquidity and reduced trading costs for all investors. Share prices are almost surely higher as a result of this reduction in trading costs, benefiting long-term investors. Higher share prices also have favorable implications for firms\ cost of equity capital. "
You are mixing apples and oranges here. Automated trading and HFT are not the same thing. Automated trading does provide substantially improved liquidity and reduced trading cost. HFT on the other hand does not demonstrably reduce trading costs (or at best the jury is still out on that) and the liquidity it provides means your transaction can go through in a fraction of a second rather than in one second. It provides no liquidity when the market is under stress as the HFT machines are plugged out immediately in non-standard situations. On the other hand, HFT takes a lot of capital out of the market for that 'service'. Is that fraction of a second of additional liquidity worh it? IMHO not.
There is so much FUD around HFT it is hard for people to think rationally about it. I had wasted the following study on a troll once already earlier this morning and therefore it would be a shame not to repost it: http://online.wsj.com/public/resources/documents/HFT0324.pdf [wsj.com]
That article is funded by Citadel LLC that owns a HFT platform. It provides no hypothesis, no metrics, no tangible goals. It's pretty much an essay reiterating a couple dozen pro HFT papers and press pieces
Maybe you could educate yourself as well and listen to some other opinions - like that of one of the fathers of automated trading.