While I take your point about taxing the rich not redirecting resources by reducing consumption (since relatively most of this money is not being used to consume*), there are other reasons. One is to make a political point. The second is that the consumption of the majority is being done with a smaller and smaller share of the national wealth. So how to rebalance things so that instead of the top 1% having as much as the bottom 40%, this can be brought down to 30%, and then, hopefully, eventually to 20%. Some change in taxation along with other changes is needed to try to slow or stop the current flow of money upwards to this minority where it grows and gets used mostly to further speed the upwards flow. The third reason is to play the bond markets at their own game. They claim to be enforcing market discipline on the government for not funding its spending through taxes - so tax them! Hilarious, and poetic justice.
*although real resources respond to demand signals, and since the rich have the most money, then when there is a constraint, the resources end up being used for whatever projects they have. Including building unaffordable housing and endless luxury flats, buying up farm land, funding politicians, buying up the media, flash cars and watches and clothes, and paying for the stream of neoliberal propaganda. The consumption of the rest will soon be reduced to rent, mortgages, energy, food and transport. Non-essentials will become unaffordable for most, and as poverty spreads the tax base will shrink. The gradual withering of discretionary spending, as immiseration continues, will mean that consumption falls, leaving a growing gap and a collapse in all the businesses that depend on such spending. A little higher tax on the wealthy would at least cheer some of us up.
I am as perplexed as Zoltan Jorovic. We all know that the more unegalitarian a society is, the worse it performs economically. It used to be a leftist standpoint, but even the IMF and the World Bank think so nowadays. So why not tax them away, and we will all be better off?
What would George Orwell say? In fact, he has already commented on the British Prime Minister:
“Like nearly everyone else in England, I know very little about Attlee. Someone who does know him tells me that he is in fact the colourless creature that he appears — one of those secondary figures who step into a leading position because of the death or resignation of somebody else, and hold on to it by being industrious and methodical.” ..
“No one, I think, expects the next few years to be easy ones, but on the whole people did vote Labour because of the belief that a Left government means family allowances, higher old age pensions, houses with bathrooms, etc., rather than from any internationalist consideration.”
Whereas, the consensus view, among historians, now is that Attlee, having been Churchill’s Deputy throughout the wartime Coalition, was one of (perhaps *the*) the outstandingly successful post-WWII PMs)
I'm not sure that yo fully understand just how parochial politics is. The drift into fanaticism comes because each politician must please a tiny handful of people - party members - who are the gatekeepers to selection. As that groups diminishes so their biases are inflated in importance. To even get selected politicians must provide a massive echo chamber of confirmation. Obviously they can renege on it later on, when elected, but then they create opposition where it matters most.
This is the central argument Isabel Hardman makes in “Why we get the wrong politicians. Anyone who has had even a glancing connection with politics at the local level in England will acknowledge the force of her and your observations.
There’s something in this, but I think the competence gap in politicians is more in their ability (or lack of ability) to be good teachers; the point Steve Richards keeps making in his excellent Rock & Roll Politics podcasts
It's easy to agree we are incompetently governed, harder to agree what a better alternative would look like. The post assumes that there is a fixed size cake and politics is about how to divide it up. But the UK's problem is a lot more about low productivity - why we are failing to get a bigger cake. It's becoming clear now to almost everyone that the centrist approach will not work. Large scale immigration has strained public services, allowed politicians to avoid difficult issues (notably the huge expansion of people not working due "ill health") and deterred businesses from investing in technology and R&D. We're a country living beyond our means, in need of a major re-boot.
The incompetence you describe is better linked to the four decades of centrism. Brown, Cameron, Osborne, Boris, Sunak have all varioisly pushed the idea that you should de-politicise various state functions and outsource them to independent technocrats like the OBR and Bank of England, who would then be beyond any criticism. Politicians are content claiming to be better managers than the other lot.
Fiscal policy has been built on providing scandanavian standard public services on US standard tax rates - only achieved with a mix of quiet defence cuts, stealth taxes and green taxes. That particular road has run out and centrism is shown up for having no answers.
I’m not sure if anyone would agree or disagree, but it seems most of what the media insists on is the ‘personality’ of politicians. Again with extracts of neoliberal history and information, does it indicate public interest or opinion? The west seems highly attracted to it, but then what channel now doesn’t show a celebrity being a clown or trying to seem human on the television? Our technology has changed (postmodernism), anyone under the age 18 rarely watches tv and instead TickTock, so does this mean we are more polarised as a society, away from different perspectives of political consensus? Where is the deeper meaning here?
While I take your point about taxing the rich not redirecting resources by reducing consumption (since relatively most of this money is not being used to consume*), there are other reasons. One is to make a political point. The second is that the consumption of the majority is being done with a smaller and smaller share of the national wealth. So how to rebalance things so that instead of the top 1% having as much as the bottom 40%, this can be brought down to 30%, and then, hopefully, eventually to 20%. Some change in taxation along with other changes is needed to try to slow or stop the current flow of money upwards to this minority where it grows and gets used mostly to further speed the upwards flow. The third reason is to play the bond markets at their own game. They claim to be enforcing market discipline on the government for not funding its spending through taxes - so tax them! Hilarious, and poetic justice.
*although real resources respond to demand signals, and since the rich have the most money, then when there is a constraint, the resources end up being used for whatever projects they have. Including building unaffordable housing and endless luxury flats, buying up farm land, funding politicians, buying up the media, flash cars and watches and clothes, and paying for the stream of neoliberal propaganda. The consumption of the rest will soon be reduced to rent, mortgages, energy, food and transport. Non-essentials will become unaffordable for most, and as poverty spreads the tax base will shrink. The gradual withering of discretionary spending, as immiseration continues, will mean that consumption falls, leaving a growing gap and a collapse in all the businesses that depend on such spending. A little higher tax on the wealthy would at least cheer some of us up.
I am as perplexed as Zoltan Jorovic. We all know that the more unegalitarian a society is, the worse it performs economically. It used to be a leftist standpoint, but even the IMF and the World Bank think so nowadays. So why not tax them away, and we will all be better off?
interesting piece, not sure i follow the link to neoliberalism though.
What would George Orwell say? In fact, he has already commented on the British Prime Minister:
“Like nearly everyone else in England, I know very little about Attlee. Someone who does know him tells me that he is in fact the colourless creature that he appears — one of those secondary figures who step into a leading position because of the death or resignation of somebody else, and hold on to it by being industrious and methodical.” ..
“No one, I think, expects the next few years to be easy ones, but on the whole people did vote Labour because of the belief that a Left government means family allowances, higher old age pensions, houses with bathrooms, etc., rather than from any internationalist consideration.”
(London Letter, 15 August 1945)
Whereas, the consensus view, among historians, now is that Attlee, having been Churchill’s Deputy throughout the wartime Coalition, was one of (perhaps *the*) the outstandingly successful post-WWII PMs)
I'm not sure that yo fully understand just how parochial politics is. The drift into fanaticism comes because each politician must please a tiny handful of people - party members - who are the gatekeepers to selection. As that groups diminishes so their biases are inflated in importance. To even get selected politicians must provide a massive echo chamber of confirmation. Obviously they can renege on it later on, when elected, but then they create opposition where it matters most.
This is the central argument Isabel Hardman makes in “Why we get the wrong politicians. Anyone who has had even a glancing connection with politics at the local level in England will acknowledge the force of her and your observations.
Very interesting and perceptive
Great piece
There’s something in this, but I think the competence gap in politicians is more in their ability (or lack of ability) to be good teachers; the point Steve Richards keeps making in his excellent Rock & Roll Politics podcasts
I imagine Rupert Murdoch is pretty happy with this state of affairs, having IMO done much to bring it about.
Great post
It's easy to agree we are incompetently governed, harder to agree what a better alternative would look like. The post assumes that there is a fixed size cake and politics is about how to divide it up. But the UK's problem is a lot more about low productivity - why we are failing to get a bigger cake. It's becoming clear now to almost everyone that the centrist approach will not work. Large scale immigration has strained public services, allowed politicians to avoid difficult issues (notably the huge expansion of people not working due "ill health") and deterred businesses from investing in technology and R&D. We're a country living beyond our means, in need of a major re-boot.
"the legacy of decades of a neoliberal ideology"
The incompetence you describe is better linked to the four decades of centrism. Brown, Cameron, Osborne, Boris, Sunak have all varioisly pushed the idea that you should de-politicise various state functions and outsource them to independent technocrats like the OBR and Bank of England, who would then be beyond any criticism. Politicians are content claiming to be better managers than the other lot.
Fiscal policy has been built on providing scandanavian standard public services on US standard tax rates - only achieved with a mix of quiet defence cuts, stealth taxes and green taxes. That particular road has run out and centrism is shown up for having no answers.
I’m not sure if anyone would agree or disagree, but it seems most of what the media insists on is the ‘personality’ of politicians. Again with extracts of neoliberal history and information, does it indicate public interest or opinion? The west seems highly attracted to it, but then what channel now doesn’t show a celebrity being a clown or trying to seem human on the television? Our technology has changed (postmodernism), anyone under the age 18 rarely watches tv and instead TickTock, so does this mean we are more polarised as a society, away from different perspectives of political consensus? Where is the deeper meaning here?