Sorry is it just me being obtuse or do other people see the bullshit arguments being attempted by the mainstream political parties? There are after all so many to choose from (bullshit arguments that is, not political parties) but the one that seems so blatantly ludicrous is the whole public spending and tax cuts debate. Once again I am going to assume that it is my failure to grasp the complex elements of macro economics that means I cannot understand the debate but let me wade in and see whether I get out of my depth.

Now for simplicity so that my non-mathematical brain can keep up let us break this down to simple household expenditure. Let us call public spending ‘shopping’ and taxation ‘income’. Now it doesn’t take a genius to recognise that if I want to go shopping I need to have some income. Hence if my income exceeds my shopping bill I am in the black but if my shopping bill exceeds my income I am in the shit and it’s bread and water for the last week of the pay month! Now were I to have the ability to set my income at what I wanted it would be folly to set it below my prospected expenditure but equally it would be unlikely I would be allowed to set it a great deal higher. Let us apply that model to the national economic model. There is state public spending, ie the money spent on public services such as the NHS, Education and the state infrastructure etc. Only a buffoon would argue against public spending, most of the time the arguments are as to how much and where. Obviously the money for public spending comes from taxation, public spending is, in essence, money spent by the public for the public. So the revenue from taxation must in theory cover the amount needed for public spending. The greater the revenue the greater the capacity for public spending, we will leave for the moment the issue of specific governments and whether they use the capacity or not. By the same token again it is not rocket science to see that the less taxation revenue the less money available for public spending. So if a party are offering you tax cuts, what you are getting is more money in your pocket every month and the likelihood that you will be required to spend more of it on things you used to get for free.

Therefore for politicians to attempt to offer a system of good public spending whilst at the same time offering a reduction in taxation is simply a cynical ploy in the hope that people will not really look too closely at it. You cannot have something for nothing and the sooner people realise this the better. At least then we might be able to have a more adult debate about who is best placed to pay for it. After all until it is accepted that the rich pay for what the poor cannot afford we aren’t going to get anywhere. I have made my views on taxation abundantly clear and therefore whilst it is no surprise to hear the Tories talk about tax cuts, after all only an idiot would think that the Tories were going to invest in public services, it would be a gross understatement to say that I was disgusted by the Labour pledge to keep the top rate of tax the same at 40%

There has been a lot of talk today about the Liberal Democrats who have announced in increase in the top rate of tax to 50% (this will however only affect 1% of the population those earning over £100,000/year) further to this tax rise is the proposal to introduce a local income tax to replace the arbitrary council tax. Analysts and critics have been focusing very much on those who would lose out the ‘middle-income bracket’ by which they are referring to those at the bottom of the rate affected and in this case households earning over £40,000. Whilst I appreciate that there is a problem in this country now that many such earners have been saddled with huge debts due to the inflated house prices etc. I cannot deflect from my view that this remains an intrinsically fairer way of gathering revenue. It is said by the Liberals that 50% of households will be better off and this will undoubtedly be the poorest half and this cannot be a bad thing. It is not without faults but remains one of the more progressive policies of the election campaign. To my mind I would be quite happy if limits were put on the local income tax such as deductions for those with children or student debts etc. This could all be subsidised by those at the top of the earnings brackets. It is about time those who have been allowed to milk the system for their own benefits were forced into putting a great deal of that back for the good of those less fortunate. It has been 26 years of halcyon days for the opulent and that has to end. Whilst I see why many people would think in the current climate that since the Liberals are the most left-wing of the major parties and the most socially progressive that they deserve the vote. The quadry is that the Liberals are still only a centre-left party, they have no pretentions to drastically change the system, they would do a bit of minor tinkering in the electoral system but they are like a version of Labour Lite and as such whilst increasingly more acceptable than the Labour or Tory lot they remain very establishment figures.

On a related note I hear the IMF has been in town telling the Labour government that they must reign in public spending or taxes will have to rise. Now one must not forget that institutions like the IMF and World Bank are populated by quite a lot of cunts. The IMF is a freelance global receiver, freebooting into countries and forcing a neo-conservative agenda on them by blackmailing them to sell off public utilities and services and general assets in exchange for loans. After what the IMF has done to Latin America I would have thought someone in the Labour government would have had the good sense to tell them to ‘fuck off’ but of course Labour are now the party of “wealth creation” rather than ‘equal wealth distribution.’ Kier Hardie must be spinning in his grave. Just over 100 years after the founding of the Labour party to represent the majority working class for the first time in mainstream politics I think it is time to admit defeat on the current lot and start again. Let us hope that Respect stay true to this tradition and become that movement, I have my reservations at certain points as I have said before but they are currently the only ones with even the glimmer of hope because they are the only ones attempting to do so.

Song Of The Day ~ The Futureheads – Hounds Of Love

Original Comments:


Mark Ellott made this comment,
The Lib Dems have been touting the local income tax for some years now. Not only would it be fiscally fairer, but would be simpler for people to understand.
One area that any government may reduce spending is to trim some of the fat in their own departments, thereby leaving more funds available for essential services (or tax cuts, I suppose). I notice that the parties talk the talk, but rarely follow through.

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comment added :: 16th April 2005, 13:10 GMT+01

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