When it comes to tax, it’s the politics, stupid.

by Rob Marchant

Not content with the questionable strategy – not to mention gift to David Cameron – of our insisting on the extension of 50% tax band indefinitely, Ed Balls has now indicated in a Progress interview that he is also thinking about lowering the threshold of the band. It was one of his leadership campaign pledges.

Doubtless, we could usefully use the money to invest in public services. But before we get into the classic Labour argument of how much money you can make, or not make, by taxing the rich, let us pause for thought and consider the following argument.

It. Doesn’t. Matter.

The question now is political, not economic. It is about perceived competence. About being in opposition, not government, and its impact on the way we do things and, most importantly, about our electoral future. These are things that both Blair and Brown keenly understood, and that is why they were successful.

First, let us state the obvious: we are currently not perceived as economically competent. Yes, Balls is starting to take that argument to the Tories, and I hope he succeeds. But, given that he is being labelled as part of the problem, fairly or unfairly, it is essential that he combats this by showing a Brown-in-his-iron-chancellor-phase fiscal prudence which shores him up politically in the eyes of the electorate.

This move says precisely the opposite. Regardless of the actual fiscal effect, the symbolism is Brownite tax-and-spend, in the eyes of the media and, quite probably, the country.  That few will be affected or that it plays to the current, populist, bash-the-bankers sentiment is not the point. By the next election, popular anger towards the bankers will have been long forgotten and people will be thinking of their own pockets.

Also, we are no longer in government. In opposition, our every move is watched for its political content and tone is often more important than policy detail.  Although we certainly need more meaty policy, at least at high level, to get past our blank-sheet-of-paper problem, everything must be filtered through the prism of sensible political presentation.

It is good that some central control is being reintroduced into our presentation. This is not insane control-freakery.  It is coordination, and it is exactly what a professional political operation must insist on in an age of 24-hour rolling news.  The Tories do it and so must we, or be left behind.

But here, instead of a formal policy announcement making everything clear, Balls has announced vaguely, in an interview, what he might do. Hence, bad news story for no reason. Wrong, wrong, wrong.

Finally, let’s look to the future. The words “hostage” and “fortune” spring to mind. Do we honestly think that the Tories, a tax-cutting party, will go into the next election proposing to retain the 50p band? Of course not. It will be the perfect instance of a Brown-style “dividing line” between us and the Tories. Some of you may not remember the 1992 Labour’s Tax Bombshell campaign by the Tories – one of the most successful of all time. It killed us electorally, almost single-handedly.  Well, the twenty first century sequel is on its way, coming to a billboard near you from early 2015.

A month ago, when Balls took the job, we argued here that he would need to watch the politics, not just the economics.  John Rentoul independently argued the same point about politics and economics here on 11 Feb.  Balls is brilliant at the latter, and we should be pleased about that: we have a first-class mind to joust with Osborne. He knows how to run a department and could be a great chancellor – if he ever gets there.

But as the redoubtable former Australian Prime Minister, Paul Keating, delightfully put it: “Don’t ever put up income tax, mate. Take it off them anyhow you please, but do that and they’ll rip your f***king guts out”.

A winning economic strategy needs a winning political strategy as well.  Without that, we’re all dead in the water.

Rob Marchant is an activist and former Labour Party manager who blogs at The Centre Left.


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25 Responses to “When it comes to tax, it’s the politics, stupid.”

  1. Forlornehope says:

    But until Labour starts making a serious case for taxing and spending more than the coalition, everything else will be just hot air.

  2. james says:

    Generally agree, but “By the next election, popular anger towards the bankers will have been long forgotten and people will be thinking of their own pockets.”

    Isn’t it the thinking of our own pockets which makes us angry about the banks? And with the economic policies of the coalition squeezing wages, isn’t that anger going to fester?

    I think Mark Ferguson has it better: http://www.labourlist.org/the-long-slow-and-neccesarry-march-to-economic-credibility

  3. Can we please, please, please, please PLEASE stop refighting the 1992 election. It was over half my lifetime ago, and if clever people like Rob Merchant don’t get over it soon, we will never be the Party we need to be to wil in this century.

  4. Marchant – apologies!

    (and win obv)

  5. Ben Cobley says:

    Hi Rob, I agree that the 50% tax band shouldn’t be an article of faith and also agree that it doesn’t send all the right messages politically to clasp on to it.

    However it is surely one of the faults of New Labour that it tried to please all of the people all the time – not least our friends in the City. For the here and now there is a very good reason for sticking to it which is an economic situation that is hurting ordinary people but not the rich.

    Also I think there is no reason to believe that the voters will have forgotten their anger towards the bankers by the next election (which, of course, could be a lot sooner than 2015). Bankers’ bonuses and general bad behaviour is now entrenched in media discourse, and everyday people’s discourse. With a new round of bumper payouts and profits to be revealed every year the resentment – and the need to do something about it – will not go away.

    We are much better off trying to come up with a way to solve the problem of the banks – not least because it isn’t just about perception. There is a big fat reality that their activities nearly resulted in an economic collapse and did result in trillions of dollars of taxpayers’ money around the world going into their coffers so they could go back to what they were doing before.

    Some day down the line their will need to be a proper reckoning, for the sake of basic social justice but also some degree of economic stability. This reckoning should be at the core of Labour policy from now on.

  6. @Forlornehope, I guess you know how I am going to answer that. That is exactly what we cannot do.

    @James (it is you this time – I checked), I agree that Mark Ferguson’s piece is very sound. My point about the banks is that it is very much a topical issue right now, it hasn’t been one particularly pre-2008 and I can’t see it being one post-2011, say. People have short memories and the focus will have moved on a lot by 2015, including probably the economy will have more or less returned to normal (if not, then it’s a different ball-game altogether, I grant you). So no, I don’t think the specific anti-bank anger will fester. Or at least, it would be greatly outweighed by other factors, like if the economy is generally doing well.

    In this context, the Tory arguments will be very simple: vote Tory to save you from Labour’s tax-and-spend mess. After all, we rescued you from the last one.

    @Emma: I know, frustrating, isn’t it? Unpleasant people (like me) keep reminding us of how it was – sorry about that. And yet…I do it not to write us off, but because I know we need to be stronger. It’s like this: in that dark time, we had no economic credibility, and we wanted to put up taxes. Learning point: if you have no economic credibility, don’t put up taxes. So, in 1997, we didn’t. We won.

    Now, if we had come out of the 2010 election as credible on the economy (e.g. if we’d lost because of something else, because the Tories were much better on, let’s say, immigration or law and order) I would be the first to say, let’s consider making a principled stand based on raising taxes for investment because that is a good dividing line, etc. Fine.

    But that’s not where we are. Right now, it is unarguable that the perception of the public is we are not trusted on the economy. It is conceivable we may just come back to win this argument (i.e. if Gideon’s plan goes hideously wrong, as it may), but it DOES NOT DEPEND ON US. So, if we are not trusted on the economy, tell me, please, how can we look at raising income tax? (Although we don’t touch the rate, we are increasing both the time and scope dimensions.)

    Finally, my point about Ed was that he isn’t just looking to raise taxes, for which he could be forgiven (as Keating points out). But looking to raise INCOME tax? It’s the worst thing you can pick. I can see the Tory Attack Unit rubbing their hands and diarising their campaign start three years hence. I am amazed that Ed Balls didn’t see this. In fact, he seemed taken by surprise when the Progress interview was seized upon in his BBC interview at the weekend (after I wrote the piece). He kept his composure well, but he was losing most of the arguments.

    We don’t need to refight 1992 – but we’d be daft not to bear in mind its lessons. You surely can’t believe the electorate is going to be looking for a party who’ll raise taxes (and least of all not-trusted Labour)? Practically every historical precedent, ever, is against this argument.

    Btw I really promise my next article will be uplifting 😉

  7. @Ben, for the here and now I have no problem with sticking to it (as does not George Osborne, short-term). It is not so much to do with whether people may or may not still be angry with bankers by 2015, but how they prioritise this in the scheme of things. In any case, to be quite clear, sticking it to the banks a little is still quite ok as part of an overall program (e.g. Brown’s windfall tax in 1997 worked very well); just not by raising income tax. So I think I we are in agreement the banks should be dealt with.

    One other reason for not doing it this way is a key point I have mentioned in other articles: this debate has been twisted in Labour circles and rage against the banks has been quite wrongly generalised to cover an entire income bracket. In short, income tax is a hugely blunt instrument because we would be affecting hundreds of thousands of citizens who are nothing to do with the City and are guilty of nothing except earning more money than some other people would like. However inequitable we may find that more general case, it is not a good enough reason to tinker with income tax, which would furthermore, most likely, be electorally suicidal.

  8. MattT says:

    Are you really so sure that the retention of the 50% tax rate will be putting us on the negative side of a ‘dividing line’ come 2015 (or whenever)? The vast majority of voters do not earn anything even approaching a six figure salary and most will never hope to do so. Indeed as more middle class jobs go overseas and more people see their life prospects narrow*, the issue of how to share the nation’s wealth more equally will I think play far more positively than New Labour orthodoxy always allowed. Are you sure that your assumptions aren’t those of the boom?

    So I wonder whether an election campaign based on Labour investment versus Tory tax cuts for the rich may be not be such a terrible thing. This election will probably take place against a backdrop of public services in some state of crisis. How are we going to convice voters that we’re going to fix it? Investment will have to play some part. Won’t it be more damaging to Labour’s economic credibility to go into an election as the party of public services but with no credible plans to pay for them? Retaining the 50% tax rate could help us here.

    Finally, don’t you think that the New Labour fear of all these taboos (tax was always a chief neurosis thanks to 1992) ultimately prevented us from articulating a radical vision that could sustain and explain what we were doing when in office? Lets no longer be afraid to stand up and argue for radical solutions in we believe in them!

    *See Peter Wilby’s latest article in Guardian. The future is going to be one of insecurity for a lot of people. As Tony Judt put it, we have to put our faith in the ‘social democracy of fear’. Though probs best not to campaign on that slogan…

  9. Edward Carlsson Browne says:

    Rob, the reason we should stop refighting 1992 is that it was 20 years ago. Britain has changed since then. In several different and contradictory ways, but it has changed. So fretting about 1992 (or worse, the early 1980s) without any evidence to show those conditions still apply is a waste of time.

    I’d also note that the 50% tax rate was wildly popular according to all polling. Even allowing for some people lying to pollsters, it clearly had significantly more than 50% support. I don’t see any reason why lowering ti to £100,000 would make a massive difference – it’s not the same as raising the higher tax rate.

    £40k is something people hope to earn one day. £100k is normally viewed as silly money. It is not a ‘people like us’ tax. It isn’t 1992, even if the comparisons were valid.

    Whether or not we could justify keeping the tax by banker-bashing is beside the point. People don’t normally favour tax rises or oppose tax cuts, but they will do if they think what they’re getting is worth it.

    If we’re for keeping the 50% rate or dropping the threshhold, we need to have something that it will pay for. My candidate would be replacing council tax with some more proportional system, as that will appeal to squeezed middle voters in marginal seats a lot more than tax cuts for the rich will.

    A fund for a house-building program might be another one that would go down well in the south.

  10. @MattT, I am afraid yes, I a really am sure. That’s how we would have hit the Tories with the same thing. There will be a dividing line, and it will be about tax. There always is. The trick is not to be on the wrong side of it.

    Also, your argument int the first para seems illogical in the language of the “bust”: we are all strapped for cash, therefore let’s raise taxes and spend more? My assumptions are that of the post-bust: the country is back on its feet but only just. I can even tell you the election strapline: “The country’s back on its feet – don’t let Labour break it again”.

    Secondly I wouldn’t worry about further damaging Labour’s economic credibility (it’s virtually impossible). We need to look at investment but funded by growth not tax-raising.

    The New Labour “fear of taboos”, as you put it, was no such thing. We just balanced the budget over an economic cycle, like any sensible government. In fact, towards the end, we lost that “fear” and went round increasing spending WITHOUT the tax revenues to fund it, at least in the short term. At the same time, the radical vision for reform of public services rather fizzled out. I put it to you that, as I mention above, no party has ousted another on the basis of more public spending since 1974, and the world has changed a lot since then.

    I know all this sounds very unpalatable, but listen to the comments of practically any Western leader in recent years (of any political party) and you will find the same basic story. Income tax is not to be messed with, as an election issue at least.

  11. One other thing to share: I invite you to consider Osborne’s
    Guardian piece from yesterday. Not because he is right – he is definitively not – but because his argument is credible and it is a highly competent and coherent attack piece, a piece I would have been proud of were it the other way around.

    No, we need a much better argument than blurting out possible major income tax changes in an interview, and then getting panned about them on national television. They are all over us on this.

  12. @Edward, your argument is memorably unconvincing: “it was 20 years ago” does not make an argument inapplicable. You seem to be saying, ha: that’s it, the debate is now over, I said “it was 20 years ago”. It isn’t. Things require a little more debate than that.

    On the contrary, the onus is on you to demonstrate that the same logic does NOT apply, when the historical evidence tends to show the opposite. There are no recent precedents, since 1974 at least, of the electorate voting for tax-raising parties to oust tax-cutting-or-maintaining parties: period. Find me one if you disagree. It would be nice if everything had changed, and the electorate suddenly liked tax-raising parties. But they don’t, and Keating’s logic stands.

    All taxes affect someone: the most popular policy in the world is tax everyone-except-me. But all taxes have an impact, both in practice and in perception of the future, where signalling is important (i.e. now they’ve done this what will they tax next?) One of the problems with the 50p band is, it starts to make people in the 40p band get nervous. And that’s a lot more people.

    Finally, a piece of advice: if you want to formulate public policy, much better to work out the policy first, then try and find a way of paying for it. You on the other hand seem to be doing the opposite: thinking that raising income tax is a good idea (it isn’t) and then go round trying to find something to spend the money on.

  13. Chris says:

    @Rob

    In ’92, Labour was going to increase the 40p tax band to 50p on earnings over £35,000. Which isn’t the same as keeping the 50p tax band on earnings over £150,000. It is Blairite bullsh*t to think the introduction of the 50p band lost us the 2010 election, if that is going to be our dividing line at the next GE I’m all in favour.

  14. Chris, nobody said it was what lost us the 2010 election, and anyway the Tories were proposing virtually the same. But trying to displace an incumbent by raising taxes is a different ballgame. For the record, Balls wants to lower the threshold to 100,000 (not 150,000) as well as making it a permanent feature.

    Your decision to be in favour is your prerogative. But if we do have this dividing line, we will lose.

  15. Henrik says:

    My sense is that much of the irritation and dislike folk felt for Labour which led to last year’s trouncing – you *lost*, remember? – had less to do with a general sense that the comrades are fiscally and economically incompetent, or that they tax too highly (although I’ve heard both said), but rather had a lot to with a perception that they’d poured untold millions of the taxpayers’ money down the drain in wasteful and unconsidered ‘investments’ – which uniformly appear to have improved pay and conditions of service for public sector workers (who are the party’s key constituency, of course) without improving quality of productivity of the services those workers generate.

  16. MattT says:

    Rob, you aren’t making any distinction between the basic rate of income tax and the top rate, which impacts on a small minority (few of whom vote Labour in any case). My (probably badly put) point about your assumption on this being one of the boom years is this:

    The old argument for leaving the top rate of tax alone was that although most voters do not pay it, most would like to and raising income tax for high earners was therefore a challenge to their aspiration to earn and own. This was always contentious, most people know they are very unlikely to ever earn that much, but I will concede that, if aspiration is the political order of the day, then it could have put Labour on the wrong side of one of these ‘dividing lines’.

    I think the crash has changed this. Here is the really important thing. Things cannot and will not go back to how they were. Our society is going to get poorer and good, well paid jobs are going to be harder to come by. That was always the logic of globalisation. It is revealing an awful truth for ordinary people in the west. That as the developing world becomes more educated, for most workers, whatever your skills, there is almost certainly someone in Beijing, or Mumbai, or wherever, who can do what you do better for less money. This means good things (as well as new problems) to the developing world of course. But we thought it would be good for us too, and, as it turns out, it really isn’t. Or at best it has proven profoundly double edged. This is the new reality for British politics.

    So the years ahead will be ones of diminishing expectations and increasing economic insecurity for the majority of the population. This has all sorts of new implications for the political economy of the viable centre-left. Issues to do with ownership and how to protect jobs will again come to the fore. But in particular, if it is increasingly difficult to grow the economic pie, the question of how the share the pie out more equitably will be crucial. ‘Tax the rich’ will not carry the negative connotations that it may have done in the past.

    The great danger for Labour is not that we become irrelevant to voters as we were in the 1980s. It is that fear prevents us from engaging with the new reality. I think that you are succumbing to that fear in this article.

  17. Edward Carlsson Browne says:

    Rob, there aren’t that many people in the 40p bracket. Not much over 10% of taxpayers (although it’s in the nature of earnings profiles that the number of people who will pay it at one time in their lives is higher, and more people will probably pay it because of Tory changes in threshholds).

    What’s more, they’re mostly in the AB social groups, who rarely vote for us on pocketbook issues. If they’re nervous, that’s less of a problem. It wasn’t spooking ABs that sunk us in 1992 – it was basic rate taxpayers who were worried by our plans on higher rate taxpayers.

    Adding another step makes a crucial difference, especially when it’s a round number like £100k – it helps to emphasise the difference between that and the average wage. Ask any psychologist – voters respond differently to “one hundred thousand” than to “ninety thousand”.

    For the record, I’m not in favour of raising income tax in general, as it’s not a winning policy as a general rule. I don’t disagree with you on that, I just think that this applies much less to the very rich than it does to the merely well-off. My suggestion was merely that you’re on stronger ground raising taxes if you can say what they’re for – look at the rise in NI to pay for extra spending on the NHS after the 2001 election, for example. And replacing council tax with something less godawful would certainly be a vote-winner. What exactly I leave to finer economic minds than mine. I’m merely focused on the politics here.

    As for tax-raising candidates winning? Obama would be an example. He couldn’t actually get his plan to let the Bush tax cuts on the rich expire through congress, but he argued for that in the campaign, despite coming under fire from McCain from that.

  18. @Hendrik: you may well be right, at least in part, if you are saying that in 2010 the electorate grew tired in not seeing the necessary reform in public services. But it’s really not very much to do with this post, which is about tax between now and 2015.

    @MattT: you are close to the point in what you are saying about basic rate taxpayers, but no cigar. It is not that they are afraid that they will one day pay higher rate tax and are motivated by that. Edward answers the point below (as well as his own question): “basic rate taxpayers who were worried by our plans on higher rate taxpayers”. It is what economists call signalling. In other words, they worry that it’s the thin end of the wedge. They make a rational guess that if you will do that to higher rate payers, one day it will be lower rate as well.

    Re the crash changing all this: I am afraid that every generation believes they have a new paradigm, that they have reached “The End Of History”, as Fukuyama did. Yes jobs will go to the East, but new ones will appear: there is no finite supply of jobs and no reason why there should be increased economic insecurity, as long as we re-skill for the new world well, and sufficiently rapidly. I am afraid that “tax the rich” will still mean what it always did – an attempt to tax people-who-are-not-me. It is a fallacy to think that you can do this with political impunity, as Labour learned through 18 years of opposition. The frustrating thing is that, having learned that lesson, we are telling ourselves (on the basis of no evidence other than wishful thinking) that it no longer applies.

    Finally, re not becoming irrelevant to voters, that is indeed the challenge. But the Labour Party’s political bubble is not necessarily the best place to get that question answered. At the moment we are looking inside for the answers: a somewhat dangerous place to start.

    @Edward: I see you think 10% small – I can tell you, it’s easily enough to win or lose an election. But anyway, you have helpfully answered your own question, it is the signalling to the standard-rate taxpayers that counts, not the effect on this bracket anyway. So your second para is spot on. After that your logic goes a little awry: I’m afraid I fail to see the evidence for your extra “step” making a “crucial difference”.

    Again, it is easy to tax people whom we don’t identify with, isn’t it? In the same way that the Tories find it easy to treat people on benefits badly. But both things come back to bite us, they are not “free lunches”. Of COURSE we need to know what the money is going to be spent on, that’s a sine qua non. Predication of taxes might just be interesting, I remember old Charles Clarke was always a fan.

    Obama raising taxes? Interesting choice. I’m not sure about the details of this, perhaps you can provide. But in any event, there is a key historical difference between Democrats and Labour anyway: the Democrats have *always* been pro-business, and have a stronger record on economics. They have no “corporatist/socialist” history. We, on the other hand, actively eschewed business and were trusted economically for the first time *in our 100-year history* during roughly 1997-2005. We then blew our credibility. We are now back to square one. I am not saying you can *never* go into an election on a tax-raising platform, but it’s extremely tricky, and in order to do so you have certainly to be economically credible. We are not, right now.

    One final coda, the US healthcare system is nothing if not a glaring anomaly in the Western world, a civilised country with a completely dysfunctional health safety-net. There is no more extreme example I can think of. If you wanted to argue for a one-off exception for a “really good reason” to raise taxes that reasonable people would sign up to, this would certainly be it. I don’t think the UK has one.

  19. james says:

    “We, on the other hand, actively eschewed business”

    No, we actively eschewed *capitalist* business, favouring co-operative enterprise.

  20. @James: you’re absolutely right, of course. But it doesn’t make any difference to the argument.

  21. Chris says:

    @Rob

    Have you got any actual evidence for this “signalling” theory? All Ed has to do is copy Obama’s method of proposing tax cuts to low and middle income earners but keeping the 50p rate for £150,000. Also, to reduce the threshold to £100,000 is actually a good idea if at the same time the personal allowance is restored to earners over £100,000 because currently the top rate of tax goes up to 60% for those earning between £100k and £140k. This could easily be the conclusion of a report into simplifying tax.

    Our credibility on the economy was lost in September 2008 when the financial system went tits up, we’d spent the past 11 years talking about light-touch regulation and praising bankers. The good reason for raising taxes on the top 1% of earners is that currently they control far too much of the countries and the worlds wealth, it directly contributed to the severity of the credit crunch recession.

  22. @Chris, well the 1992 election was a classic example of signalling. The number of people actually affected by Smith’s proposals was relatively small, but it was still though to have been a significant factor, if not the significant factor, in costing us the election. By the way, in this case I’d imagine the 10% additional revenue actually raised on salaries over £100,000 would surely be paltry anyway.

    By the way, I’m all for simplifying the tax system, but the point is why even talk about it now? Especially if you’re not going to do a shadow budget.

    I couldn’t disagree with you more on the raising taxes on the top 1% because “they control far too much of the countries and the worlds wealth”. It sounds like you want to punish them. And as if raising taxes for rich individuals would stop them controlling the world’s wealth anyway? In any event, I fail to see how this “directly contributed” to the severity of the recession.

  23. Chris says:

    @Rob

    “well the 1992 election was a classic example of signalling. The number of people actually affected by Smith’s proposals was relatively small”

    But much larger than the number of people affected by a 50p band on earnings over £150k or £100k. How does this signalling theory fit with vast amounts of polling data showing the majority support higher tax bands for very high income earners. Also, the majority of the famous tax bombshell was the NI threshold being increased by the tories but not by us.

    “By the way, in this case I’d imagine the 10% additional revenue actually raised on salaries over £100,000 would surely be paltry anyway.”

    Only if it wasn’t enforced properly.

    “By the way, I’m all for simplifying the tax system, but the point is why even talk about it now? Especially if you’re not going to do a shadow budget.”

    Good point!!! Ed should keep schtum on tax and just announce a commission into taxation.

    “I couldn’t disagree with you more on the raising taxes on the top 1% because “they control far too much of the countries and the worlds wealth”. It sounds like you want to punish them. ”

    LOL, who needs Ayn Rand when you’ve got Rob Marchant. If punishment is to only receive 50p in the pound on earnings over £150k sign me up.

    “And as if raising taxes for rich individuals would stop them controlling the world’s wealth anyway?”

    Well it would reduce it. And it would go some way to reducing income inequality and poverty.

    “In any event, I fail to see how this “directly contributed” to the severity of the recession.”

    Of course it did, why do you think there was a credit crunch? The very wealthy want a secure place to park their money and earn a nice yield. After Lehmans, they took fright and poured all their wonga into safe havens or started shorting everything and praying for a crash. If wealth was shared more equally, i.e. those at the top got less, there wouldn’t have been this flight of capital, ordinary people wouldn’t have been hit as hard potentially losing everything and becoming a liability to society rather than an asset.

    Really, the Blairite analysis of the Great Recession is severely lacking. You guys think it was just a blip yet look back in economic history and a halfwit could see the financial crisis was a re-run of the meltdowns in 19th and early 20th centuries. Even David Cameron has said laissez-faire is over FFS.

  24. @Chris: You are quite right that the number of people affected by this 50p band is even less than in 1992, but the number of people is really irrelevant, that’s the whole point of signalling. And the NI threshold argument didn’t come into it – guess why? Because the intellectual bandwith of the electorate was focused on the simplified message “raise taxes”, they didn’t care about the detail.

    By the way, how does this with fit with your polling? Another person, it seems, with excessive confidence in what polls tell you 4 years before an election. People say all sorts of things to pollsters depending on how they feel that day and how the question is phrased. Political strategists deal on what they actually are likely to do on election day, and that is – time and again – vote against parties who raise taxes.

    I’m glad we seem to agree at least on Ed’s tax announcements! On the revenue raised, yes it would be paltry (do the math!) And in any case these people all have good accountants who will help them avoid it. Yes, tax these bad people out of existence, that’ll show ’em. Only it won’t.

    Re your recipe for avoiding credit crunch/flights of capital, here it seems you are arguing for a complete reworking of the way capital works in practically every country in the world (possible exceptions of Cuba and North Korea). Good luck with that.

    Chris, no-one is arguing for laissez-faire. If you think New Labour was laissez-faire you completely missed the point, it was hugely interventionist. Cameron’s posturing is of little interest, he makes warm noises and then implements a neo-Thatcherite agenda, at least economically.

    Finally don’t make assumptions: you really have no idea if I am a Blairite or not. I don’t label my political views.

  25. Chris says:

    @Rob

    “And the NI threshold argument didn’t come into it – guess why? Because the intellectual bandwith of the electorate was focused on the simplified message “raise taxes”, they didn’t care about the detail.”

    Of course, that is why we should argue for lowing taxes on the vast majority and only increasing tax on the very wealthy.

    “Another person, it seems, with excessive confidence in what polls tell you 4 years before an election. People say all sorts of things to pollsters depending on how they feel that day and how the question is phrased. Political strategists deal on what they actually are likely to do on election day, and that is – time and again – vote against parties who raise taxes.”

    Opinion polling going bad years has shown support for higher tax bands on very high earners.

    “On the revenue raised, yes it would be paltry (do the math!) And in any case these people all have good accountants who will help them avoid it.”

    Like I said it is only if the higher band isn’t enforced properly.

    “Re your recipe for avoiding credit crunch/flights of capital, here it seems you are arguing for a complete reworking of the way capital works in practically every country in the world (possible exceptions of Cuba and North Korea). Good luck with that.”

    Enough of the straw man.

    “Chris, no-one is arguing for laissez-faire. If you think New Labour was laissez-faire you completely missed the point, it was hugely interventionist.”

    Light-touch regulation was interventionist? Please explain that one.

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