Gordon’s Tax and Benefits Mess

tax+benefits

According to an ONS release today the mythical average household is £31 better off after taxes and benefits are taken into account. Think about all the complexities of tax collection collection and benefit calculation, the bureaucracy and time wasted. It really is time for a lower, flatter, simpler, single income tax…

The statistics also confirm that after 5 years of “we’re all in it together” that Osborne has raised taxes on the richest 20% and reduced the burden on the poorest 20%.  The bottom quintile are net recipients of just over £10,000 in welfare transfers from those who actually pay taxes. Will no one stand up for the wealth creators?

Danny Blanchflower Does it Again

Guido has in the past reflected with some scepticism on Danny Blanchflower’s economic forecasting.

There’s been an election and we have a new government, so it’s only fair to offer him fresh start and a chance to prove us wrong.

Last month derpy Danny wrote in the Indy that, despite wage rises in the previous two months, “Chances are next month we will see a big drop again. I will keep you posted”.

Well?

This month’s figures out today show that “Comparing February to April 2015 with a year earlier, pay for employees in Great Britain increased by 2.7% both including and excluding bonuses”. Here is the continuing rise in wages in graph form from the ONS:

Keep us posted, Danny…

IPPR: Tax the Poor

ippr-tax-the-poor2

Labour wonkshop IPPR have published a list of policy proposals today that aim to tackle the adverse affects of the government’s low-carbon programme on low-income groups. That would be the same IPPR who have spend years pushing for the decorbonisation policies that have disproportionately screwed over Britain’s poor…

The IPPR’s solutions to the problem include public ownership of new nuclear capacity and lifting the moratorium on onshore wind farms. Gaia would expect nothing less from the place that let a wind energy company write their report on wind power…

24 Hour Drinking: In Numbers

Today’s new Institute of Economic Affairs report by Christopher Snowdon looks at the impact of 24 hour drinking. Guido has crunched the numbers into a handy infographic:

As the report finds: “Facilitating longer opening hours may have been the best thing the Labour Party ever did…”

Ben Harris-Quinney OUT of Bow Group

Following a successful round of media interviews during the election campaign, Guido understands that Bow Group chairman Been Harris-Quinney has decided to step down to spend more time with his numerous other made up jobs. Every single patron of the group blasted BHQ for his Blue-kip endorsement plan so the writing was on the wall.

Tory Wars: Bow Group Split Over UKIP Endorsement

Ben-Harris-Quinney

The oldest Tory think tank has descended into open warfare after its chairman said Conservative supporters should vote UKIP where the Tories can’t win. Earlier today Ben Harris-Quinney told the Telegraph:

“Our preference at this election is a Conservative majority, but few in the Conservative Party will acknowledge the reality that this is now very unlikely to happen… We recognise the need to keep Ed Miliband out of Number 10, and the best way to do this is for Conservative voters to lend their votes to Ukip, who are best placed to beat Labour in many areas.”

He has a point…

This evening at CCHQ’s behest four patrons of the Bow Group have kicked back at Harris-Quinney. Michael Heseltine, Michael Howard, Norman Lamont and Nirj Deva MEP said in a punchy statement:

“As Patrons of the Bow Group we believe that this country’s best interests are served by voting Conservative in all situations. Ben Harris-Quinney does not speak for us or represent our views.”

Blue on Blukip!

Labour Manifesto Author Backs Tory Right-To-Buy Policy

MARC-STEARS-ED-MILIBAND

Marc Stears, Professor of Political Theory and Fellow of University College, Oxford, is not merely an old university friend of the Labour leader, he is one of Ed’s closest advisers and his chief speech-writer. More importantly he is the co-author of the Labour manifesto.

In 2012 Stears wrote approvingly in the New Statesman about an IPPR report calling on the left to favour letting housing association tenants have a right-to-buy:

The stable patterns of social interaction that are associated with communities of ownership are preconditions for the kind of social reciprocity that the left champions, as well as the more conservative disposition that is more usually commented upon. There is, in other words, a social argument for ownership…

 An argument being made by the author of the Labour Party manifesto, for a policy appearing in Conservative Party Manifesto… 

Last night however the knee-jerk Labour twitterati collectively lost it when they heard of the Conservative manifesto commitment to introduce a right-to-buy for housing association tenants. Atul Hatwal, editor of Labour Uncut, was a lone Labour voice of sanity:

It could have been so different, the policy could have been a Labour manifesto commitment if only they had taken up the recommendation from the Labour aligned IPPR think-tank:ippr-sell-homes

The report recommended:

Extending the rights to buy, acquire and manage to all housing association homes, levelling the playing field in terms of opportunities for ownership and control in social housing… 

… there are currently over a million housing association properties which cannot be bought by their tenants through the right to buy or right to acquire (Davis and Field 2012), and the right to manage does not apply to housing association homes. Notwithstanding the legal, logistical and administrative challenges entailed, the rights to buy and acquire (with the discount rate sensibly capped) and the right to manage should be extended to all housing association homes

The authors were not wild-eyed wonks, they were Andy Hull and Graeme Cooke. Hull is a councillor in Islington and the Cabinet Member for Finance and Performance and since leaving IPPR now works for Owen Jones’ left-wing Class think tank. Cooke used to be a SpAd when Labour were in government and still works for IPPR (helping to write the Condition of Britain report which inspired a lot of the Labour manifesto).

Labour tweeters attacking the Tories for putting this policy in their manifesto should know that comrades Hull and Cooke recommended this policy as a way to improve housing. Alan Milburn and Frank Field also called for the right-to-buy years ago. No doubt the Labour twitterati will say these are all irredeemable Blairites (they’re not), therefore apostate. Marc Stears however is Ed Miliband’s left-hand man and he too supports the right-to-buy for housing association tenants. 

First They Came for the Upper Decile…

top-decile

Yesterday was another orgy of “bash the rich” political populism. Once again, as the above chart from the Treasury shows, the most productive people were punished the most by the Chancellor. This is because he thinks it is good politics. It isn’t.

Osborne boasts that he is putting the biggest burdens on the broadest shoulders because “the rich can afford it”, a view widely held across the political spectrum, even some Tory MPs agree. They might have a rethink when they understand that the upper income decile getting clobbered year after year is not the mansion and yacht owning super rich, it includes them. The median gross income that puts an individual in the top decile is £60,500, that is less than what an MP earns. The same MPs whom so often claim they can’t live in London on their salaries….

Since 2010 Osborne has gone out of his way to make sure that the gini coefficient is better than it was under Gordon Brown, the measure of income inequality shows that inequality is declining under the coalition, the rich are not getting richer relative to the rest of the population. We are all relatively poorer is Osborne’s pathetic boast.

quintiles-since-2010

By the next election the upper quintile since 2010 will have suffered the most under this government – upper income voters are usually well disposed towards voting Conservative,  yet the Chancellor clobbers his core vote. Why do members of the commentariat glibly repeat that Osborne is a strategic genius? The Conservative voter’s answer to Reagan’s famous question “Are you better off now than you were four years?” is most likely “no”. For an individual to be in the upper income quintile they have to earn the princely sum of £39,800. Not exactly people who spend their weekdays in mansions and weekends on yachts… 

Why does the son of a baronet do it? It is because he is the son of a baronet that he feels he has to do it, the toxicity of the posh, rich charge is what they fear most. The polls persistently show that people think they – Cameron and Osborne – don’t understand “ordinary people like us”. So to neutralise the charge they punish their own supporters most, and it still doesn’t do any good…

Now Even the Nerds Turn On Ed
Top Prof Warns Miliband Has “Failed to Perform”

If there was one voting block Ed Miliband thought he could rely on, it would be his fellow nerds, yet a four-year academic study granted access to Ed Miliband’s inner circle today concludes he has “failed to perform as a […]

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Ending the Migrant Worker Subsidy

immigrant-subsidy

Youth unemployment in the Eurozone’s southern victims is catastrophic, half their young have no jobs. The young are mobile, usually without children and it is entirely natural that they will seek work where it is, in fact it is admirable. […]

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Debating Sound Money

steve

Hayek MoneyIn the commons chamber right now Steve Baker MP is proposing the denationalisation of money. Together with colleagues spanning four parties – Michael Meacher (Lab), Caroline Lucas (Green), Douglas Carswell (UKIP) and David Davis (Con) – he has secured a […]

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Defusing the Debt Timebomb

Sponsored post.

Government borrowing is currently running 10% higher than last year – exacerbating the already parlous state of the UK’s public finances.

This week, as part of its 2020 Vision initiative, the Institute of Economic Affairs launched its new […]

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Jean-Claude Juncker:

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