Thursday, March 22, 2012

A few general comments about the Budget

There was an e-mail from George Osborne in my inbox; addressing me as Dear Helen, he explained at some length how radical his Budget is. First of all, I had not realized we were on those terms and, secondly, I do not think that kind of over-the-top description of a pretty so-so Budget is appropriate.

Immediate reactions were predictable: Tories whoopped with joy and called it brilliant, those on the left screamed with horror, smokers talked darkly about fascism (like they know what the word means) and the rest of us were left bemused for a while then realized that it was not radical, not brilliant, not evil but an itsy-bitsy, give a little - take a little kind of Budget. Some good ideas, some not so good ones, most things postponed till next year and nothing very daring or brilliant.

There have been a few rational analyses from the Adam Smith Institute, from the IEA and from Reform via Reuters (this being less coherent than the other two). None of them are impressed though acknowledge that there are some good things. I'd say that Osborne is displaying an almost Brown-like obsession with micro-management and dislike for people who make money.

Anyway, discussions about the Budget will go on till at least Sunday though the news from Toulouse and, possibly, China might eclipse them.

A few general points need to be made, however. Osborne's proposed regulation on tax avoidance (which is entirely legal) shows that he is one of those who believes that money basically belongs to the government and we all have a duty to hand over as much of it as they require at any given time, this duty being moral as well as legal.

As the statement from the ASI put it:
The General Anti-Avoidance Rule is a bad idea. It leaves far too much latitude for bureaucratic discretion. It adds another layer of complexity on our labyrinthine tax code. And it is an affront to the rule of law. Radically simplifying taxes is a much better way of ensuring people pay their fair share.
That, however, appears to be contrary not just to the Chancellor's thinking but to that of many others inside and outside the political world. I took part in a number of discussions today with people (many of whom are in not so radical UKIP) who solemnly announced that if there are tax cuts then the money has to be replaced from somewhere else. When asked why they thought the government absolutely had to have this money and spend it on all those projects they sounded stunned. The idea that perhaps the state should not be spending quite such a large proportion of our money and that, perhaps, it would be better if some things the state spends money on now were actually taken out of its greedy grasp was completely alien to their way of thinking.

Then there were the other discussions with people who fulminated about "greedy bastards" who did not "pay their fair share" and did not "give back to society from which they had benefited". Really, it is as if people like  Hayek, Ayn Rand or Milton Friedman had never written their various seminal works.

People, I explained, who create wealth and make money do not benefit in some unspecified way from society and their best contribution to it is to continue to create wealth. (And, no, I did not believe the assurances that the people who were arguing with me never, never avoided paying all the taxes they could have paid if they did not take certain precautions.)

Even more astonishing were the many assurances that paying taxes in order to support the NHS, the education system and the welfare structure was essential if we wanted to live in a humane and civilized society. It was our contribution to such a society. The idea that people could look at the questionable NHS, the disgraceful education system and a welfare state that has created a huge underclass and call it civilized and humane seemed quite extraordinary. Almost as extraordinary as the assumption that paying taxes is the only way of contributing to the welfare of other people otherwise it is dog eat dog and an I'm all right Jack attitude.

It is at times like this that I despair for this country.


  1. Perhaps you missed the loud screams of anger emanating from a fairly large section of the voting population, namely those who are pensioners.

    I truly do believe that the Chancellor, like his bosom 'buddy' Cameron, cares not a hoot for those who voted for the Tories, and got instead a LiB-Dem dominated Cabinet where the sandal-wearers must always be kept happy, and the bloody Tories don't count.

    Georgie will come to rue the day he made a one-line throwaway remark which sliced off millions from pensioners who thought that Georgie-porgie was a Tory!

    1. Mike: I always knew Dave was no Tory, as the "heir to Blair" he 'did a Blair' and just picked a party that he thought would provide the ladder for his ambitions. However, I did think George might have been a Tory. What a disappointment.

      Wouldn't have minded losing my additional tax allowance as a step towards a simpler tax system, or if it appeared to fit some grand design. There doesn't appear to be any grand design and he appears to be complicating other aspects of the tax system. As you say, obviously not a Tory.

    2. Then again, what makes you think Tories are any different from the other parties when it comes to overtaxing and making the system too complicated for people to understand? A good deal that is blamed on Blair was actually started under Major and even under Thatcher.

  2. I apologize for not mentioning that, Mike. I was trying to make general comments about the government and those outside it, rather than discuss details. You are quite right, though I see no reason to suppose that all pensioners would necessarily vote Conservative.

  3. It's lucky we do have a failing education system because bright sparks like yourself would of been taught to work hard, pay your taxes and die the day you retire.

    One up side to the London riots is that the brain washing of the sheeple is failing in a major way.

  4. Rubbish, Anonymous (and, please, sign your comments). They were not riots but lootings by people of their own community. In other words, they have been brainwashed to hate anyone who achieves anything and to assume that the state will provide. If you can't work that out you might like to go back to school yourself.

    1. Correct Helen. Everybody has rights but the only ones with responsibilities are the rich and the entrepreneurs who are supposed to support everyone else