Thursday, 23 October 2014

If benefits claimants should get smartcards instead of cash, so should MPs

It's a terrifying idea that I almost envisaged months ago (almost because I was referring to 'workers credits' rather than 'benefits smartcards'), long before hearing IDS' proposals: pre-loaded smart cards for benefits claimants instead of cash. Apart from being a nasty and stupid idea (sometimes people need cash e.g. for bus fares, car parks and all sorts of other things), it is open to favouritism and corruption and independent retailers would probably miss out on the deal.

I wonder how MPs would feel if they didn't get expenses, just a pre-loaded smart card that was only valid for the following;

  • Groceries
  • Public transport (not including taxis)
  • This is the end of the list.

If they want to cosy up to some lobbying corporate suit over dinner and wine, let the profiteers pay for it. Otherwise, they can eat like the rest of us. And as for £100 taxi rides across London, they can squeeze themselves onto the tube or bus.

Tuesday, 21 October 2014

The neo-liberal trilogy of illogical economic ideals

"Capitalism doesn't work without capital." Brilliantly simple quote from Max Keiser a year or two ago. If everyone is in debt and nobody has anything to spend, then capitalism can't work. Ok, some people have money. But they either live in Russia or the oil-rich Arab states, or they hide it in offshore tax havens.

Here's an idea: share the wealth. It's a very old, very simple idea that those with wealth and those in power dismiss immediately, laughing, scoffing, puking up their expensive (possibly subsidised) breakfast onto the Times, Telegraph or FT (I'm not suggesting for a second that any of those papers might promote the merits of wealth distribution; this is a hypothetical scenario where someone within earshot of a wealthy/powerful person makes this suggestion).

Why should they consider it? Because they'll all be better off. It's obvious but worth repeating: if people can afford to spend money, they'll spend it and the rich will make bigger profits. And surely capitalism needs consumers with capital? As things stand, instead of making money from sales, they have to squeeze their outgoings by reducing the amount they spend on staff wages (by freezing or reducing salaries, making redundancies, reducing hours or moving to contracted or self-employed staff with no rights) and avoiding tax where they can (which at the moment, is in many places and many ways).

That brings me on to the second factor in this doomed (yet somehow still perpetual) neo-liberal capitalist model, and that is low tax revenues. The rich, those on the right and most of those in the centre ground of politics (Labour and Lib Dems are included in that) have been promoting, begging for (or rather, wining and dining and yachting in aid of) and implementing the low-tax policies of the anti-socialist movement for decades. The country does not generate enough tax revenue to supplement the incomes of those being paid peanuts by their employers. But because they're being paid so little, we have a large benefits bill which subsidises wages so people stand a chance of eating three meals a day and having a roof over their heads. And this is only going to get worse if the Tories stay in power (or if the Lib Dems get in - which they won't) because they will raise the income tax threshold to a level which means that almost anyone on the minimum wage will pay no income tax whatsoever. Why not increase the minimum wage to make sure they have the same amount left at the end of the month? The reasons why they won't raise the minimum wage to a living wage are lurking in think-tanks and restaurants around Westminster, lobbying from within on behalf of their private-sector employers.

The third and final factor is the idiotic and irresponsible ways that governments try to force perpetual growth. Economic growth has mostly been able to continue despite huge national and personal debts. This can't go on in economies where tax revenue and personal wealth are both low because debts will just grow and grow: despite their claims, the current UK government are increasing the national debt. They may be reducing the 'deficit' but only thanks to massive cuts to public spending (deficit is basically income minus expenditure). If their claims about rising employment were having an effect on the economy, you'd see a two-fold improvement because there would also be more tax revenue helping to "pay down the debt" (I hate that phrase). In fact, when you look at the figures, although the huge bail out of the banks during the last parliament should have been a one-off (albeit in stages over the course of a year or so), the state of the economy under the current government has meant that even the deficit has reduced gradually despite the huge cuts.

I disagree fundamentally with the pursuit of low taxes and a smaller state. We would all benefit - including the richest few - if we are all paid a decent wage and all paid into the taxes that we need to run the country. Low tax, low pay (for the vast majority) and the pursuit of growth together simply cannot create economic prosperity. And those who claim that it is are lying to you.

Thursday, 2 October 2014

Tories' economic plans makes lies of their claims to "represent" those on low incomes

We know the Tories hate tax and want to see a minuscule state with as little tax as possible. So their plans to increase the 40% tax threshold to £50,000 (thus taking some people on good salaries out of the top rate) and take the lower tax level to £12,500 (thus taking anyone working 30 hours or less on minimum wage out of income tax altogether) is not surprising. I'm just sick of hearing lies.

The party's claims that they are helping people on low incomes are utterly false. They are reducing benefits to 'encourage' people into work and raising income tax for those earning minimum wage to make it slightly more worthwhile having a minimum wage job. But this totally goes against their claims that they're giving people the opportunity to earn a living rather than relying on handouts. A tax cut IS a handout. Surely if people on low incomes were earning a wage that they could afford to live on and contributing to the costs of the services they use by paying income tax, THAT would be more likely to make them feel as though they were valued and making a valuable contribution?!

The Tories' solution is a quadruple win for them:

1) They feel that doing this means they don't have to tackle the problems of the rising cost of living and poverty wages
2) Which is great for the big private businesses flogging their staff whilst creaming massive profits off the top
3) They are also lowering taxes which is a permanent Tory policy
4) The fall in tax revenue allows them to show figures suggesting that further spending cuts are necessary

In fact, it's a quintuple win:

5) Keeping people on low incomes tied to government policy rather than being able to afford to exist because they're earning a decent salary keeps the plebs in line and stops them feeling like they might be say, half as important as a tax-dodging hedge fund manager.

Of course this only works if you believe them. How to make people believe them? Get the majority of the media onside.


And where is the money for these tax cuts going to come from? They're going to tell us later.