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April 30, 2009

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Anna

"it's always heartening to see a successful man from a humble background being badmouthed by a Stalin groupie from a privileged background."

LOL

So how does it work -is Michael Caine the class enemy now?

Tim

"Again, as so often, the term “social justice” is deployed triumphantly with no clear definition. Though readers are led to suppose that “social justice” could entail, in ways never quite specified, ... A more equal society... better physical and mental health, less crime and smaller prison populations... lower rates of teenage pregnancy and obesity, and higher rates of literacy and social trust."

And all this is supposed to happen in a *less* affluent society? The confusion over cause and effect & the assumption of a causal relationship between "social justice" and a "better society" is mind boggling. As if poor people have better (rather than worse) health; as if poor societies have less (rather than more) crime (granted, they tend to have smaller prison populations - but that's because local justice is swift, though often not just); as if poor societies have lower teenage pregnancy rates (granted, maybe lower *unmarried* rates - since they include marriages at 12...); and as if poor societies generally marked by armed guards and walled compounds have more "social trust" than many rural and not-so-rural U.S. towns where we leave our doors unlocked at night. Sheesh.

Chris S

"better physical and mental health, less crime and smaller prison populations... lower rates of teenage pregnancy and obesity, and higher rates of literacy and social trust."

I love how this more equal society can be easily achieved by individuals exercising simple self control and reduced impulsive behaviour. No state intervention required.

People seem to miss the most obvious thing, why improve yourself or your situation if your extra effort gives you no additional benefit? If I do the bare minimum, I get payed X. If I work harder I can make Y and then it's taxed at a higher rate so that I'm making less than X. Why work harder?

That's why flat tax is the best option. It's truly egalitarian. No "social justice" adjustments required. Plus people will no longer have a disincentive to work harder.

Mr Eugenides

As ever, excellent. And your point about the incentives caused by taxation is well taken. Personally, I think that higher taxes on alcohol, like higher taxes on the rich, are likely to have rather more modest effects than some alarmists claim. But, to the extent that there is an effect, it will clearly be a negative one.

Indeed I would have thought it's blindingly obvious that one of the corollaries of being "rich" (howsoever defined) is that you can, broadly speaking, do what you like, and live where you like. The genuinely "super-rich" do not have to clock in every day, inspect a factory floor, come into the office on weekends to pick up a file. Even the merely very well-off have a degree of labour mobility that the EU can only dream of extending to us all. (Except for our politicians, of course, who are only employable beyond our shores if as EU Commissioners.) And in the next ten or twenty years this is only going to get easier as communications technology improves.

If I were earning a million pounds a year, I would spend half of it somewhere sunny, and raising the tax rate would only persuade me to make sure I was spending six months + 1 day [or whatever the threshold is] resident abroad for tax purposes. But I'm not rich; and, having lived on an income which had me nervously eyeing the cash machine from about the tenth of the month onwards, and having to put stuff back on the supermarket shelf because it was going to eat up the last of my cash, I can tell you that putting the price of a pint up by 5p never stopped me going to the pub.

Maybe that makes me a alcoholic, now I think about it; but the point is that the paternalistic state has never succeeded in using the tax system to incentivise me to drink less. To the extent that I control my drinking, it is - hang on, just cracking open another cold one - it is not because Alistair Darling has made clear his disapproval; indeed, I'd wager cash money this year's Budget drove more people to drink than away from it.

To that extent, I'd say the rich are *clearly* more tax-sensitive than those of us on modest incomes. I'd say that's so obviously true as to invalidate just about anything else Seumas Milne writes, even if you didn't know that he is from a privileged background and unlikely ever to have been forced to wander round his local Iceland looking for a tin of affordably-priced tapenade.

wayne fontes

I saw a clip of Margret Thatcher dealing with that question was posted on one of my favorite sites recently. I fine answer in my opinion.

http://tigerhawk.blogspot.com/2009/04/margaret-thatcher-on-distribution-of.html

georges

It's only personal income that is being raised. Corporation tax is still low at 20%, and the clever can just massage their corporate accounts accordingly. Remember Lord Levy?

http://www.independent.co.uk/news/uk/politics/lord-levy-received-pound160000-free-of-income-tax-715613.html

Simen Thoresen

Wayne, brilliant video.

I agree. It seems that once poverty has been relativized, it is the gap in wealth and not the actual wealth of the society that matters to those who care about it's citizens.

We're seeing the same thing here at home (Norway) where last year our (labor-socialist) government opened a new front in the war against poverty by attacking the 'uncultured newly rich', and generally dismissing their concerns in the public discussion.

The logic of this is crystal clear - while the creation of wealth is beyond the politicians, the destruction of wealth is not, and both would lead to a more fair and equal society.

-S

David

Mr E,

“I would have thought it's blindingly obvious that one of the corollaries of being ‘rich’ (howsoever defined) is that you can, broadly speaking, do what you like, and live where you like.”

The rich also tend to make fewer demands on public services. For instance, Milne argues: “Let Michael Caine leave. Fairer taxes must be made to stick if we’re to avoid the cuts in services Cameron has in mind.” To which, a commenter at Tim Worstall’s place replies:

“Michael Caine’s money is free money. He’s retired, never has to work again, gets driven around by a chauffeur. I expect he has the best private health care, has no kids in school (and if he did, they’d be in private school) and probably lives in the sort of place with private security. He probably alone pays for the living of a page full of the Guardian’s job[s]. I’d actually suggest a millionaire’s tax band: 1%. They’re already way over anything they cost the state at that point, so let’s encourage all the motor racing drivers, rock stars and whoever else to just come here and spend their money in our economy rather than the economies of Switzerland or Monaco.”

http://timworstall.com/2009/04/30/umm-seamus-laddie/

It’s another way of looking at it. Certainly it highlights a possible distinction between raising funds for “social justice,” whatever that might mean, and punishing the wealthy for ideological reasons. And if the two objectives should prove to be in conflict, which one would Mr Milne prefer? Answers on a postcard please.

georges

David

Yes, the overclass effectively opt out of society. They use private security rather than the police, private schools rather than state schools, private hospitals rather than state hospitals, private transport rather than public transport. It's hardly surprising such people feel no allegiance to the country or its people. They have almost no interaction with them. Relocation is relatively painless.

We have elections in the UK. If you don't like what the current government does, you can vote them out next time; debate with your fellow citizens; even stand for Parliament yourself. But if you feel no bond with the rest of society, you can't really join the conversation.

David

Georges,

“Yes, the overclass effectively opt out of society… It’s hardly surprising such people feel no allegiance to the country or its people… if you feel no bond with the rest of society, you can’t really join the conversation.”

That’s pretty loaded framing, don’t you think? Is membership of “society” now being defined by a crappy education at the local comprehensive, regular use of the NHS and journeys on public transport? If I were to become fabulously rich and chose entirely private healthcare, transport, etc, would I be less of a citizen? Less entitled to complain about policy? Less of a person?

Generally speaking, I don’t have hardline feelings about tax policy; it’s not something I often fret about. But when someone is being screwed out of half of what they earn, the word “screwed” seems legitimate, along with the right to feel pissed off about it. Yet the impression given by Milne’s article is that it’s somehow *improper* for Michael Caine to object, as if doing so automatically made him a bad person, as if the money being taken weren’t actually his.

And it’s interesting to note how the terms “selfish” and “greedy” are implicitly reserved for people with a certain level of income. I don’t often hear such terms being used to describe, say, abusers of welfare who expect something for nothing at someone else’s expense on an indefinite basis. Or socialists who feel entitled to punish the wealthy and confiscate their earnings to whatever extent suits them ideologically. Much as Milne lays claim to the term “fair” as if the fairness of the tax rise was self-evident and uncontestable. Ditto “social justice,” which he never quite defines. Presumably, “social justice” doesn’t extend to Michael Caine, or others faced with a 50% tax rate, who may well have a different idea of what constitutes fairness. As I asked in the post above: to how much of your income (or mine) is the government morally entitled?

SG

"Yes, the overclass effectively opt out of society."

Georges: don't forget the underclass…

"'They were six months old when they had their first McDonald's,' she said. 'They had chicken nuggets and chips and loved it. 'They like fish and chips too, but I take the batter off the fish, so I guess that's healthy.' Miss Salt's immense weight meant the safe delivery of her triplets - daughters Deanna and Daisy, and son Finlee - last August was a major challenge for medics. It took a 68-strong team and a bill for the NHS of £200,000, including a specially-built operating table for her Caesarean section. Now back home in Coventry and living on benefits, she says she is too busy to prepare proper meals for her triplets or do much in the way of housework. Miss Salt, who blames her obesity on a thyroid problem, fell pregnant after seeing her then boyfriend for just four weeks."

http://www.dailymail.co.uk/news/article-1174210/30-stone-mother-feeds-baby-triplets-junk-food-diet--admits-McDonalds-just-months.html

Who's more selfish -Michael Caine or this feckless parasite?

Anna

"But if you feel no bond with the rest of society, you can't really join the conversation."

Translation: if you don't agree with socialist redistribution, you don't count and we won't listen to you.

georges

Taxes can't be purely voluntary. There has to be an element of coercion. In practice, only the state can exercise that coercion in a way that most people will accept, however grudgingly. The rate of tax will always be an open political and economic question. It can't be a matter so settled that, for instance, a written constitution could set the rate of income tax forever. All we can ask is that, in a democracy, taxes can only be set by an elected government, and can only be changed by electing a different government. The slogan of the American Revolution was "No Taxation Without Representation" - not "No Taxation, Period".

At each election a large minority don't get the policies they want. Fortunately, most of them don't immediately desert the country, but stay and argue for a change of policy. This is what I'd prefer people to do, if they feel they can. Michael Caine is, of course, completely free to leave the UK and live somewhere else. But - and this is all I mean by "joining the conversation" - I think it's better if people who want lower taxes stick around and argue for that with their fellow citizens. They might well win the argument. It's widely agreed that John Major won the 1992 General Election because voters feared higher taxes under Labour, and that Tony Blair had to make clear promises on tax in order to win the 1997 General Election.

We can argue over whether the present government is right to raise the top rate of income tax in the present circumstances. But who on this thread would argue there are NO circumstances in which such a rate could ever be justified? Suppose this country faced some imminent mortal danger, as it did in 1940, and the government desperately needed the money to keep the Luftwaffe at bay, or to stop the country from starving. In such a situation I'd definitely pay up.

Horace Dunn

Georges

"There has to be an element of coercion ... taxes can only be set by an elected government, and can only be changed by electing a different government".

Well, indeed, but the democratic process doesn’t start and end with general elections. And you go on to make precisely this point – that there is an argument to be had and that that argument could change government policy. You say that you’d prefer the likes of Michael Caine to stay and argue rather than desert the country, but perhaps this very desertion (if, indeed, it happens) is a more powerful way to make the point than hanging around moaning about it.

I don’t think that anyone here is arguing that there could never be a circumstance in which tax increases could be justified. But given that the Luftwaffe (or any 21st century version of the same) aren’t buzzing around our heads right now, and allowing for the fact that the current administration has handled public finances with a frankly bewildering level of incompetence and dishonesty, a robust public response to their proposals is surely neither unexpected nor unwelcome.

And when people make their robust responses, it seems rather rich that pampered establishment types like Milne dismiss them as “naked class egotism”.

David

“Yes, the overclass effectively opt out of society… It’s hardly surprising such people feel no allegiance to the country or its people.”

Maybe we could turn that around a little in light of Miss Salt, mentioned above, who seems to have “opted out of society.” If the account of her attitudes is even partly accurate, it suggests a pretty serious rejection of bourgeois proprieties – i.e. a rejection of personal responsibility, parental duties, and the reciprocal assumptions of society in general. Her attitude appears to be one of unilateral entitlement rather than mutual obligation – an attitude the welfare system has apparently done little to challenge. Does she feel allegiance to those who have to subsidise her choices, or an obligation to minimise the costs she inflicts on others? Does her former boyfriend, the father of her children? (SG asked, “Who’s more selfish - Michael Caine or this feckless parasite?” And the question seems fair.) More to the point, do we imagine that screwing Michael Caine out of yet more of his earnings would have much effect on the attitudes of Miss Salt and thus on the way her life unfolds?

I don’t mean to suggest that Miss Salt is a typical recipient of long-term welfare, though she’s hardly unique. But if someone (say, Professor Zygmunt Bauman*) believes that the existence of such people (in whatever numbers) is an indictment of society in general and grounds for greater redistribution via taxes, isn’t there a problem here?

* http://davidthompson.typepad.com/davidthompson/2008/05/details-details.html

georges

Within the overclass, Michael Caine and J.K. Rowling have diametrically opposite views about tax. And I don't know how typical Miss Salt is of the underclass.

The poor are often more willing than the hyper-rich to join the armed forces and risk death in Afghanistan or Iraq or wherever. Partly it's "economic conscription". The army is virtually the only route to self-improvement for many poor young men. The children of the wealthy have more options.

The Thin Man

So now the Armed Forces get a kicking too. I was waiting for that.

Have you ever actually MET any Soldiers, Sailors or Airmen, georges?

Don't you remember "HALP US JON CARRY - WE R STUCK HEAR N IRAK"
http://www.freerepublic.com/focus/news/1730016/posts

You really shouldn't go there georges, because slagging off military personnel to score political points just isn't nice and such cartoonish stereo-typing of the most disciplined, brave and under-appreciated group in our society makes me want to drop a piano on your head. REALLY - DON'T go there....

Walk a mile in their shoes before you claim that they are economic refugees or insinuate that they signed up because it was the only thing available - because those ideas couldn't be further from the truth.

I suppose it's only to be expected though, as most of your views are based on the same one-dimensional view of things.

David

Georges,

I can’t help noticing I’ve asked lots of questions but the ground keeps a-shifting before the answers arrive. :)

In case it isn’t clear, I think the welfare state is a good thing; it’s good that some kind of safety net is provided for victims of circumstance, with the idea that wherever possible they regain a footing and get their lives in a more functional order. But, inevitably, abuses will occur and, among many, an infantilising effect is hard to avoid. This problem of welfare abuse and dependency is difficult to address effectively, and it may be worth drawing comparisons with criminal law, where it’s generally felt as preferable for some guilty criminals to go free rather than have innocent people convicted. But left unchecked, the infantilising effect is likely to grow and dependency is likely to become more entrenched, as if it were a legitimate lifestyle choice with no moral implications. And despite the claims of Guardian columnists, objecting to this phenomenon and what it costs doesn’t make one mean or selfish or evil. (And it’s possibly worth noting that neither Milne nor Polly Toynbee has been overly concerned with frivolous uses of tax revenue, despite them being a routine feature of the Guardian’s own “jobs” and “society” pages.)

Doubtless some will claim Miss Salt is a random aberration or totally unrepresentative and therefore irrelevant. But I’ve encountered plenty of people with very similar attitudes, and I doubt I’m alone in that. More to the point, it seems to me Miss Salt’s behaviour (and that of her former boyfriend) is effectively being sanctioned and rewarded by current welfare provision. The more such people are shielded from the natural consequences of their own choices and stupidity, the more they may feel entitled to suck at the taxpayers’ teat, and the more their numbers may grow, along with the level of subsidy required from functional people. Now, my basic point is this: If Seumas Milne wants to throw around class war rhetoric and mutterings of exploitation and “entitlement,” maybe he should compare Mr Caine with Miss Salt and ask the obvious question: Who’s the exploiter here, and who’s being exploited? Or does Milne imagine that poor people can’t be exploitative?

James S

"it seems to me Miss Salt's behaviour (and that of her former boyfriend) is effectively being sanctioned and rewarded by current welfare provision. The more such people are shielded from the natural consequences of their own choices and stupidity, the more they may feel entitled to suck at the taxpayers' teat, and the more their numbers may grow, along with the level of subsidy required from functional people."

Charles Murray says the obvious:

"Our grandparents' most basic taken-for-granted understanding, which today's intellectual and political elites find it hardest to accept, is this: make it easier to behave irresponsibly and more people will behave irresponsibly. The welfare state makes it easier for men to impregnate women without taking responsibility for them, easier for women to raise a baby without the help of a man and easier for men and women to get by without working. There is no changing that situation without reintroducing penalties for irresponsible behaviour... Put the cost of irresponsible behaviour back where it belongs — on the man and the woman, their families and their community — and the recognition that the behaviour is wrong will revive instantly, along with powerful social pressures to make sure it happens as seldom as possible. Some of those pressures will be positive, celebrating marriage as a uniquely valuable institution and bestowing social approval on the bride and groom. Some of those pressures will be negative, consisting of various forms of stigma. This is good. Stigma is one of society's most efficient methods for controlling destructive behaviour."

http://ukcommentators.blogspot.com/2008/04/i-have-vision-of-future-chum.html

nk

Is this thread over? It was just getting good.

pst314

Taxes can't be purely voluntary. There has to be an element of coercion.

The grasshoppers voted to tax the ants.

"I think it's better if people who want lower taxes stick around and argue for that with their fellow citizens. They might well win the argument."

The ants can persuade the grasshoppers to stop being parasites?

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