Elizabeth Warren and The Non-Existent Social Contract

There's a video that has been doing the rounds recently to much adulation from my statist friends. It is of Elizabeth Warren, a would-be Senator campaigning for that bloated old fool Ted Kennedy's seat, talking about "the underlying social contract". Take a look, and then we'll start to dissect what Warren has to say:



I'm not particularly interested in her analysis of the economic woes of the US - yes, Bush Junior was a profligate wastrel when he was in power, but his replacement has done little to reduce the size of the deficit facing the US. In fact, he's made things worse. Rather, I want to look at this sort of underlying social contract argument that Warren uses.

First things first, on an initial listen/read, it is actually quite persuasive. On a surface level, she appears to be talking some sense. Yes, we are fundamentally and crucially individuals. But I know my life would be unpleasant and really rather short were I not part of a community. I'm not fantastically wealthy, and I never will be, but I do know the fact that I can live in relative comfort is not solely down to my own abilities. I need the interactions with others and the infrastructure of wider society in order to be able to attain and maintain my lifestyle. The super-rich are no different. But this acknowledgement of the essential inter-connectivity of modern life does not do the heavy lifting that Warren seems to think it does within her argument. Because it is all largely smoke and mirrors; drill down, and you start to see a lot of holes. So let's drill down.

Well, this is class warfare, this is whatever. No. There is nobody in this country who got rich on his own. Nobody.

Perhaps nobody did get rich on their own. But a lot of rich people have done so because of talents and skills that, while not unique, are very much the exception rather than the rule. There are three main ways in which people get rich: having a great, marketable idea; being willing to take risks; and/or being willing to work really hard. Yes, they need other people, but it is also something within them that allows them to differentiate themselves from other people and create something that makes them very wealthy. As such, their relationship with those who assisted them in making them very wealthy is symbiotic. This is a crucial point: no-one got rich on their own, but equally no-one got rich purely because of the benefits of the wider society around them.

It is telling that Warren never actually demonstrates that we're not dealing with class warfare here. Sure, she goes on to argue for a social contract, but since she does not convincingly demonstrate the existence of that social contract, her case that it isn't class warfare is not even implicitly made.

You built a factory out there? Good for you. But I want to be clear: you moved your goods to market on the roads the rest of us paid for;

And, of course, the factory-owner himself almost certainly paid for, and owing to the fact that they earn more money, probably paid more for than the average worker in the US and maybe even a greater percentage of his/her income.

Furthermore, there is something a little naive (at best) in this idea that goods get out to market through a publicly funded infrastructure. This may well be true, but what choice does the entrepreneur have? They are expected, under threat of imprisonment, to pay tax to the state, which then goes out and builds roads etc. Now, it could well be that an entrepreneur may want to fund his/her own infrastructure, private to his business, that could work more efficiently for him/her. But they have no choice but to hand over the funds that could be used for such a project to the government. Thus, they have no choice but to use the publicly funded infrastructure. As such, Warren's argument becomes essentially circular - you give money to the state, therefore you can only afford to use the public infrastructure, therefore you should pay for that infrastructure. And that argument is predicated on the far too seldom challenged notion that there should be no opt-outs from the tax system for those who do not wish to avail themselves of certain public services. Even if our entrepreneur could still afford to fund his/her own transport network, they would still expected to pay for the public one. Their hand is almost forced; they may as well use the publicly funded roads as otherwise they're going to end up paying twice for the roads they use.

you hired workers the rest of us paid to educate;

A spurious assertion that assumes our rich person doesn't hire privately educated people and that public education is of a high enough standard to truly benefit our entrepreneur friend. And, once again, our entrepreneur is also paying for that system to educate his/her workforce through taxation.

you were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.

Hmmm. Because, since the advent of publicly funded police and fire services, there has never been a burglary or a building burning to the ground, right? Of course not; that's yet more nonsense. But Warren here seems to be falling into the naive trap of thinking that if the state funds and runs something, it is going to make us safe. That is, of course, nonsense on stilts. As factories investing in security guards and fire prevention systems shows. And, again, that entrepreneur ends up paying twice - once for a public system that is often bloated, inefficient and unable to do what it is supposed to be doing. The second time for a private back-up system designed to compensate for the inefficiencies of the public system they are forced to contribute to.

Now look, you built a factory and it turned into something terrific, or a great idea? God bless. Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.

I love the "God bless". Wonderfully patronising. Wouldn't worry too much about approaching those wealthy, big-money donors any more, Elizabeth. On the flipside, hate the phrase "pay forward". Just doesn't work at all..

But at the heart of all this is a sweeping, intellectual and ideological power grab. Warren is arguing that there is a social contract that underpins all we do, and that we need to adhere to it because we are part of society. But she is trying to do something even more bold - she is trying to claim that not only is there an underlying social contract, but she is the one who understands it. Therefore, we all need to fall in line with her statist policies about the redistribution of wealth through tax. So we've gone from an apparently innocuous argument about fairness in society to a much broader, and more dangerous, argument that is predicated on the idea that Elizabeth Warren has found the real truth about our society.

The big problem is that social contracts - underlying or otherwise - actually don't exist in any practical way. They are theoretical constructs of political philosophers designed to either offer an alternative to the status quo or to explain the transition from some sort of state of nature to the status quo. They are illustrations rather than actually part of the reality of modern politics. Therefore, to claim one exists and should actually be the guide for how much the state intervenes financially in the lives of its citizens is problematic to say the least. In part because we never signed up to any such social contract. Nor did our parents, or their parents, and so on. In fact, the person who signs us up - whether we like it or not - is someone like Warren. And she decides how we should interact with each other within society through nothing other than her own spurious and contestable argument and her own arrogance.

Which is the big problem I have with Warren, or at least the way in which she depicts herself in this video. Once you get beyond the folksy presentation of the case for redistributive taxation to the actual meat of what she is saying, you get a level of arrogance that I find very troubling. She's found the underlying contract. She knows best; about what is good for society, her supporters and for you. It is only a small step from finding that social contract to what Rousseau termed being forced to be free. On the basis of a contract you never signed up to because it has just been created as a rhetorical device for a campaigning politician, the state can demand more from you. And I know I can't be alone in finding that deeply concerning.

Yes, because the problem is, and always has been, a lack of spending, rather than - say - an ongoing refusal to reduce taxes so people can actually spend their own sodding money.

Fucking, fucking idiots.

Tax Reform

Now, I'm all for combining income tax and national insurance. The latter is a tax, pure and simple, so it should firstly be called a tax and secondly incorporated into that other direct tax on our income. Simplify the system; make it more transparent. And yeah, the rate of income tax would go up if NI was incorporated into it. But that is also a good thing. Not because I want to pay more tax, mind, but because the plainer we make it to everyone just how much money we end up being forced to give to the government, the more likely people are to start protesting about it.

But, of course, not everyone agrees. However I do have to say that this is a pretty dumb reservation:

Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, described the mechanics of the income tax and National Insurance merger as a "minefield".

"It is a lot easier said than done," he said.

As an aside, let's just take a moment to note that this is a tax accountant complaining about taxes being made simpler. Hmmm, wonder whether he might have a vested interest in a complicated tax system?

But let's look at the substance, if we can call it that, of what this chap is saying. Of course, changing a system is often difficult, and fraught with problems. So what do we do? Overcome those problems. Anything else is a manifesto for the worst sort of political conservatism. It is basically saying it is broke, but we can't be arsed to fix it.

Just imagine if humans throughout history had the same mindset. "This divine right of kings business seems a bit problematic to me". "Yeah, but the transition to another system is going to be tough though". "Ok, let's not bother". Apply this mindset to the American War of Independence, or to World War Two, or the Space Race. Nothing even remotely challenging has ever got done or will ever get done with this sort of defeatist mindset.

Of course, there may be many reasons why projects shouldn't be undertaken. Morality is key, as is the practicality of the overall project - the Marxist utopia might sound grand, but the transition to it involves dictatorship, and it is underpinned by certain unlikely assumptions about human nature, so let's not bother after all. But if the sole objections to a plan are that it might be problematic to make it happen, it is probably a sign that you should start trying to solve those problems rather than bleating about them. Particularly if, like incorporation of NI into income tax, short term complication will lead to long term transparency and ease of use.

The Problems With Tax

To me, there’s no question about it: taxes should be reduced, and the tax system fundamentally changed. Yet we live in an age where people listen to the likes of Richard Murphy when they talk (apparently without irony) about The Joy of Tax, and where people attempt to damage the productivity of businesses that carry out perfectly legal tax avoidance actions. So at this point it is probably worth offering a personal perspective on why I think tax is bad; or, at the very least, tax is not a de facto “good”.

Let’s start by looking at the counter-argument to any claim that an individual might not want to pay tax: we pay for any number of different goods through choice, so why not choose to pay tax which offers both the individual and others clear benefits?

Now, it is true that I choose to spend money on various things. These are both things that offer a tangible benefit to me (such as paying for my various postgraduate studies) and things I just enjoy (books, DVDs etc). I also pay for essentials even if I would rather not – like rent and food.

And I have no issue with paying for essentials through the tax system. The first problem comes, however, with the level of tax I am expected to pay for those essentials. Take rent: before moving in somewhere, I shop around to get value for money. Not so with the tax system. I am forced to contribute money to the NHS, for example, even though when I try to use those services I am required to wait for ages and am generally seen by someone who frankly mocks the title of “medical professional” through their incompetence and disinterest. There’s no shopping around with tax; you pay the rate you are told to pay by the government. In fact, unless you are self-employed, you don’t so much pay that money as have it taken from you on a monthly basis without ever really seeing it for yourself. Therefore, the first reason why I resent paying taxes is because I resent seeing my money wasted in the way the British public sector wastes it, year in, year out.

The second problem comes with what the money is spent on. Now, I might choose to walk into HMV, and once there, I might choose to buy some products. Of course, I’m only going to buy stuff I have no ethical objection to: I might buy a DVD boxed set of a TV series I want to see. I’m not, however, going to buy anything associated with The X Factor, since I believe that show is partially responsible for the nosedive in the intellectual capability of people in this country. The same is not true of tax; quite simply, I pay for things of which I simply do not approve. I have no problem with paying for police officers to investigate crimes; I do have an issue with paying for thug-like riot police who possess no concept of proportionality. Likewise, I’ve no objection with my money being spent on armed forces to give this country a defensive capability, but I do resent the money I earn being spent on wars of aggression in Afghanistan and, in particular, Iraq. In short, I can’t choose what my money is spent on, regardless of my own ethical considerations.

And the problem of choice – which underpins this whole post – is also at the centre of my final objection. I walk into HMV and there is no-one compelling me to make a purchase. I can turn around, walk out and go somewhere else or simply not spend any money at all. The same is absolutely not true of tax. I pay tax or I go to prison. There is no choice with taxation; it is extracted from the population under duress using menaces. Furthermore, there is no opt-out. Even if I choose never to use a single public service and therefore cost this nation nothing, I still have to pay tax. There is no way of choosing not to participate in the tax system, just as there is no way of choosing not to have my money spent on things with which I just cannot agree or a way of choosing not to have my money wasted on bureaucracy and ineptitude in the public sector. In short, the tax system we have in this country is illiberal and almost seems set up to provoke the genuinely intellectually engaged into resenting it.

Of course, it could be very different. Show me my taxes aren’t being wasted, and I’ll feel happier about having it taken from me. Give me an opt-out in areas which I would rather fund myself, or over tax money spent on illiberal domestic policies and aggressive foreign policies, and I’ll start to feel comfortable about the government taking so much of my income. But until that happens, I’m going to see tax as a problem and anyone who avoids tax as not immoral or wrong, but rather someone attempting to maximise their own freedom in the face of draconian legislation and inept, government led waste.

Crippling the Big Society

I'm starting to read a lot that the spending cuts will undermine Cameron's Big Society. This is, of course, utter bollocks. In as much as we can define Cameron's Big Society, it seems to be asking the people of this country to do what the state can no longer afford to do. Therefore, the Big Society is not undermined by spending cuts; rather, it is (at least in part) created by those spending cuts. The more Cameron's government cuts spending (or, rather, cuts the growth in government spending) the more the Big Society will be called on to plug the gaps.

But I'll tell you what will kill off the Big Society - a failure to cut taxes. It is all very well expecting people to volunteer to work for and to donate money to their local communities; it is another thing entirely to expect them to do so while paying the same exorbitant tax rates for fewer services from the government. There's nothing wrong, as far as I am concerned, with expecting individuals and their community to take more responsibility for their own communities. There is something naive about expecting them to do so while still giving such a high percentage of their incomes to the government.

Spending cuts won't kill the Big Society; taxes will.

You know the old quip about how government's will tax everything? Well, here's Julia Gillard and her new tax - a flood tax.

Jesus.

The Vodafone Protest

So, you’re concerned about government spending cuts, and you believe that Vodafone has not given the tax man – or HMRC – what it should. So you decide to protest this apparent oversight at the source. The first flaw in your plan is that, well, HRMC actually aren’t asking for the money:

"We cannot comment on the detail of the settlement but we can confirm that it was reached by HMRC following a rigorous examination of the facts and an intensive process of negotiation that tested the arguments of both parties.

"As a result it was agreed that Vodafone’s liability was £1.25bn and at no point was a liability greater than that established.

"There is no question of Vodafone having an outstanding tax liability of £6bn. That number is an urban myth."

So you’re protesting over an urban myth. Nice. Good going there. Unfortunately it makes this protest anything other than legitimate – in fact, it turns it into a form of chugging: demanding donations from Vodafone for your favourite charity (in this case, the government).

And if we take the idea that paying as much tax as possible is good, at least in the eyes of these protestors, then surely you would want Vodafone to make as much money as possible so they can pay as much tax as possible in the future. Therefore, what is one of the last things you would want to do? Perhaps closing down their flagship store through protesting.

Far be it from me to say that this protest hasn't been thought through, but to protest about a non-existent tax bill in such a way that you may end up diminishing future tax revenues strikes me as the very definition of dumb.

Tuition Fees, Hard Choices and Richard Murphy

I'm guessing that the whole tuition fee thing is going to flare up into a row. Ho-hum - that's life, I guess. And I don't have a whole lot more to add. Except when I see this from Richard Murphy:

I guess I should declare lots of interests: I have a degree, largely paid for by the state; I have young sons who may one day go to university (but who knows?). I want to live in a civilised society, where learning is valued for learning’s sake. And where all have equal access to it.

Well, let me in turn declare my interests: I have a degree, paid for in part by the state. I have a postgraduate degree (MA) - paid for by me. And I am embarking on a PhD - again, without state help (at least to begin with). The point here is that I want to do something, so I'm doing my level best to make it happen. And, as it stands, that involves a fuck load of hardwork. I'm not going to bellyache too much, but equally I'm not going to rely on (and wait for) a state to enable me to do what I want (particularly not a state saddled with massive debt)*.

As for the idea that there is going to be a society where "learning is valued for learning's sake" - owing to human plurality, this is an impossibility. Simply ain't going to happen. You are always going to find some who value learning for learning's sake, and some at the other extreme who believe that life experience is more important than the learning that can be gained through education. As a result, you will find some people who may be apathetic about others going to university (and even staying in education for their whole lives) but will be damned if their taxes are going to fund that desire.

Murphy, once again, seems to be missing the point. We need to start asking ourselves harsh questions about further and higher education in this country. What subjects should the state contribute towards, and which should be self-funded? Which courses are essential for our society, and which might be fun but ultimately are non-essential? Of course, this is an area where people will have very different personal opinions and some sort of consensus around this highly contentious issue. But that consensus needs to be reached. Because - ever since Nu Labour decided that as many people as possible should go to university - there has been a massive rise in degrees that achieve little more than debt both for the state and for the individual taking that degree. University is not right for everyone, and not everything needs to or indeed should be taught at university level.

In a sense, I agree with Murphy - I value learning for learning's sake. I'm just not sure that the taxpayer should have to pay for that learning.

*Anyone who does want to help, though, should feel free to use the donate button in the side-bar. Yeah, I know, I'm a shameless whore - but I reckon it is better to ask others for money than demand that the state demand it from others through tax.

A Tax on the Stupid

Y'know, a lot of people used to call the National Lottery a tax on the stupid. I don't think that's quite fair - it is a tax on the idiotically optimistic. Sure, you're pretty stupid if you enter the lottery but in the near impossible circumstance that you won, not many people would be remarking on that stupidity. Unlike, say, if you gave money to the last government in return for one of their pointless, invasive and pointlessly invasive ID cards.

Therefore, I've got no sympathy whatsoever for people affected by this:

Labour have failed in attempts to get compensation for people who bought ID cards, which are set to be scrapped.

They say thousands of people who voluntarily spent £30 on cards did so in "good faith" and should be refunded when next renewing their passports.

But they lost a vote in the Commons during a debate on proposed legislation to abolish the cards.

If you got an ID card before you had to, then you are either a Labour minister, utterly thoughtless or blindly obedient to the state. All of which suggest you are a person of limited intellectual capacity. Furthermore, if you paid for an ID card knowing that the opposition parties opposed them and that opposition party would almost certainly form the next government, then you are doubly stupid. Basically, you wasted your money. You lost out on the money you sunk into the ID card scheme. Boo-fucking-hoo for you.

Normally I support the government returning whatever money they can to the people. In this case, though, I don't - partly because they cannot afford to refund those stung by this scheme. The entire ID card folly cost the taxpayer millions - each ID card is estimated to have cost £20,000 each. This isn't just government waste - this is government waste pumped up on speed and steroids. The comparatively small amounts of money individuals have lost by signing up to the scheme is gone - as is the taxes of many others who had to pay the government under duress for this scheme, even if they didn't get an ID card and thought the whole thing was a shit idea from the very start. If you paid for an ID card, you don't deserve a refund. You're just a bit dumb.

Which is perhaps the sole achievement of the ID card scheme - it finally managed to create a tax on the stupid.

Richard Murphy's Reverence for the Police

Richard Murphy, prize clown, on an example of what he calls "the joy of tax" - our police force:

Sometimes stating the obvious is necessary.

Uh-huh. Allow me to state the obvious - Richard Murphy is a total arse. Moving on:

We need police.

We need laws enforced.

Which assumes (a) that all laws are moral, and therefore should be enforced and (b) the police are capable of enforcing the law in all circumstances. Fellow participants in what I would call reality would dispute both of those assumptions.

And just as much we need their presence in communities – where I suspect they do a lot more simple offering help and direction than they do law enforcement.

What? Where the hell does Murphy live? In an episode of Dixon of Dock Green? I've lived in four cities and a rural village in this country, and I have never, ever seen the police do anything relating to "help and direction". Most of the time it is a bastard struggle to get them to do anything relating to law enforcement.

I am well aware that there are those on the right who think the police – and even law – can be privatised.

Not if they've seen Robocop. Yup, I know Robocop isn't real, but we're dealing with Mr Murphy here, people, making reality a movable - if not irrelevant - feast.

That’s wrong. A coherent system of law and order underpins a society. Only government can command and direct such a service.

Yeah, because left-wing governments never behave illegaly. Oh, wait... And the police. They'd never do anything illegal. Oh wait...

Only government can pay for it.

Government doesn't pay for it. The taxpayers do through money appropriated from them with menaces by the government. Whether they like it or not.

That’s the Joy of Tax.

Once again; Richard Murphy, what a total arse.

Richard Murphy on the problem of taxpayers being overcharged by HRMC:

There is an answer, of course.

The answer is more tax inspectors.

No, that's not the answer to any question other than "how can we waste more of the taxpayer's money?" There is an answer, however. And it is this - simplify the tax system. In fact, go for a flat tax. But a tax accountant like Murphy could never go for that now, could he?

The Mash on the Graduate Tax

I've got a lot to say on Vince Cable's new, and utterly moronic, idea for a graduate tax, but it will have to wait until I've got a bit more time to put my thoughts in order. In the meantime, I'll send you in the direction of this article on The Daily Mash, and in particular this quotation:

"It is a central tenet of Liberal Democrat philosophy that the harder you work, the more tax you should pay."

As Homer Simpson might say, it's funny 'cos it's true.

Joe Biden, Taxes and Foot in Mouth Disease

A little story about US Vice-President Joe Biden putting his foot squarely in his mouth in a frozen custard store:

Then it got really bad. Biden engaged the owner in conversation. "What do we owe you?" he asked, licking a cone. "Lower our taxes and we'll call it even," the owner replied.

Leave it there, Joe! Don't do it!

But no, Biden just had to answer back, for the benefit of the cable news channels. "Why don't you say something nice instead of being a smartass all the time? Say something nice," he snorted.

In fairness, Biden claimed that he was "just kidding" with the owner. Which he may well have been, but it is still a very stupid retort and one that is perhaps more revealing about Biden's thought process than he might like. There is nothing wrong with asking for lower taxes - it isn't a nasty comment, and it certainly isn't being a smartass (despite what The Guardian inevitably implies at the very end of the article). Biden appears to be demonstrating the arrogance that has become an epidemic among politicians on both sides of the Atlantic - that the tax we pay is their money to spend, rather than something they should be looking to minimise on behalf of those they claim to represent.

I suppose that America can at least be grateful that their Vice-President tries to engage with the public - even if it is in a patronising and dismissive way. It is certainly very different from the example set by... I don't know, Gordon Brown - who might disagree with a voter, but would say nothing to them or about them until he was safely in his car.

David Cameron: Class Warrior?

Johann Hari reckons that it isn't Gordon Brown who's after fighting a class war; but, rather, one David Cameron. Yep, with the sort of rhetoric and political insight that would be more befitting of someone like Wolfie Smith, Hari seems to think that Cameron is an evil rich man, determined to steal from the poor and give to the rich.

The article is, of course, packed full of crass gems. I'd just like to take apart a couple of examples that seem to highlight the stupidity of Hari's assertions. Let's start with this one:

The problem isn't Cameron's extreme privilege – it is that he has never tried to see beyond it. He keeps accidentally revealing how warped his view of Britain is, and how little of it he understands. For example, Cameron said in an interview: "The papers keep writing that [my wife, Samantha] comes from a very blue-blooded background", but "she is actually very unconventional. She went to a day school."

Read that sentence again. Now imagine how Britain looks from inside David Cameron's head, where the 97 per cent of us who went to day schools are "very unconventional". (In the Bullingdon Club, he called George Osborne "oik", because he had gone to the £20,000-a-year St Pauls, not the £30,000-a-year Eton.) This points to a wider mindset. The group he considers "conventional" and "normal" are the only people he has ever really mixed with, and they are the people he chooses to staff his office with today – very rich people. Is it any surprise he makes policies that serve them, not us?

I'm not entirely sure how Cameron's perceptions of his wife's schooling - which ended years ago - is relevant in any way, shape or form to his potential success or otherwise as a Prime Minister. It certainly isn't proof positive that he has never tried to look beyond his admittedly privileged upbringing. And as a head's up, for someone truly "blue-blooded", it would be odd if they did go to a day school.

I'm also pretty sure that we shouldn't make a judgment about whether Cameron is able to empathise with the way in which the rest of the people in the UK live (who are themselves not a homogenous group of people with identical experiences that are diametrically opposed to those of Cameron, contrary to what Hari seems to think) based on a quip he made at university as part of a club that gleefully and childishly relishes elitism. It would be like dismissing a Labour politician for having a teenage flirtation with Marxism.

As for Cameron making policies to benefit the rich people with whom he has such a connection, well, I'd have to disagree on that as well. Cameron - whenever he decides to actually commit to anything - tends to focus on populist politics. Or, to put it another way, politics that bows to popular opinion. His background is clearly and consistently dominated and overpowered by his desire to win an election and become a Prime Minister. Cameron is trying to create neutral policies that either appeal to, or at least don't offend, the majority of people in this country. Not to kowtow to those who share a similar background to him.

This whole idea that a rich man like Cameron cannot empathise with those beyond their own social background is blatant nonsense. You only have to look at, say, Franklin Roosevelt to see that "rich" people can act on the interests of the "poor" and/or the "middle classes". Hari's crude idea that the rich lack any sort of empathy is as crass as it ignorant. Someone's background - be it ethnic, regional or financial - does not mean that they cannot understand those who don't share similar backgrounds. To believe so is to be almost the definition of bigoted. It also is to misinterpret representation - the truth is that in order for someone to represent you, they don't have to be exactly like you. In a world made up of individuals, such a misinterpretation utterly destroys the concept of representative democracy.

The truth is plain, and it is provable. David Cameron's policies will take money from the hard-working majority of Brits, and hand it to his friends and relatives on landed estates and in tax havens. He is not on your side; he is on the side of a tiny clique who have every luxury in life and now bray for even more. Cameron bragged to his supporters last month: "Nothing and no one can stop us." It's up to the majority who will lose out if he become PM to say – oh yeah?

And here we have the essence of the problem that I have with Hari's argument - that Cameron will be taking money away from hard-working Brits (as an aside, when did the left-wing get so populist and nationalist?) and giving it to the rich. Because if Cameron does get round to giving tax breaks to the rich, it won't come from the normal people. No, he will be taking from the state and giving to the rich. By all means criticise Cameron for only giving money back from the state to the rich; but don't pretend that he is taking it from the poor or from normal hard-working Brits. There is a big difference between the people and the state; to assert otherwise is utterly deceitful. Hari makes a point that he has been better off since Labour came to power. Well, he'd have been even more better off if the Labour government had not tried to redistribute income and had instead enabled itself to make tax cuts by rolling back the parameters of the state. The problem with Cameron isn't so much that he is willing to cut taxes for the wealthy, but rather that he isn't willing to commit to tax cuts for all. That doesn't make him so much of a class warrior as a tentative politician afraid of committing to something that isn't in mainstream political discourse.

The ironic fact is that the only true class warrior who emerges from Hari's article is Hari himself, as he is the one who is prepared to dismiss people based purely on their social background.

A benefit to the election

Regular readers will know that I'm not looking towards the coming General Election with the sort of barely contained excitement seen in some of my fellow bloggers. Nonetheless, I have managed to find the silver lining to the cloud that is blanket coverage of what promises to a bland race. Yes, the dissolution of Parliament means that not all of Nu Labour's tax rises can be forced through before the election:

The government has dropped plans for a 10% tax rise on cider following fierce opposition to the move.

Ministers were forced to rescind the increase, announced in the Budget, as part of efforts to get laws passed after the general election was called.

With Parliament dissolving on 12 April, a broadband tax and an electoral reform referendum have also been dropped.

Magic. I might raise a pint of decent cider later today as I surf the internet to toast these small areas where Nu Labour hasn't been able to get its own tax-focussed, statist agenda forced onto the statute books.

An Open Letter to the Chancellor

Dear Alistair Darling,

Having noted the number of tax rises in your last budget, I'd be very grateful if you could go fuck yourself, you arrogant, incompetent, thieving arsehole.

Best,

The Nameless Libertarian

Paying Tax As "Giving"

There is nothing quite as jarring as Peter Mandelson – a man who has a proven track record of resigning in disgrace – criticising another wealthy man for the heinous crime of trying not to pay huge sums in tax.

But there is no shortage of people attacking Mandelson and the members of all parties who appear happy to wade through a massive mire of hypocrisy in order to have a pop at a Tory benefactor. And I’ll leave them all to it. Instead, I wanted to look at an example of how this has been portrayed in the media – in this case, by The Guardian. Take a look at this paragraph, and see if you can work out what I find most troubling:

Ashcroft and the Tories have refused to answer questions about when Ashcroft fulfilled the less onerous task of declaring himself a long-term resident, which allowed him to continue to be a non-dom paying tax only on his UK earnings and avoiding giving tens of millions of pounds to the tax office on his substantial international estate.

Have you spotted the most troubling phrase? It is the idea that Ashcroft is avoiding “giving” his money to the tax office. Now, who actually “gives” their tax money to the Inland Revenue? Who “gives” their taxes up? Anyone? Anyone? Oh, no, at best – at fucking best – we pay taxes. Taxes actually tend to disappear without the majority of people in this country actually actively giving up the money. It goes before your pay hits your account. You pay tax whenever you buy a commodity that includes VAT. You pay tax all the time – however, people don’t tend to give tax money to the tax office.

Does this sort of distinction matter? I mean, it’s The Guardian we’re talking about here. They are never going to describe taxation as state sponsored theft. But the very fact that the use of the concept of giving taxes is so subtle is what makes it so troubling and pernicious. It is arguably far more damaging than any statist fuck banging on about tax avoidance like it is a financial equivalent of the fucking Holocaust. Because it is so subtle, and so easy to miss. Yet the more it is repeated, the more it feeds into the dominant discourse in this country that giving money to the state is a good thing. In fact, the use of the word give is very interesting – after all, we give to charity, so we can extend that to the state. Yes, giving to the state is like giving to charity. That’s the agenda that this sort of subtle framing wishes to perpetuate. Except the government charity is just as likely to spend it on war or banking bailouts than on something those who perpetuate this myth actually think deserves funding.

So the next time someone tells you that you give money to the tax office, please feel free to tell them to fuck off, and grow a brain cell while they do so.

The Robin Hood Tax

There should be a website that details – and tears apart – the seemingly endless number of Facebook groups that are set up by people with a slender grip of reality. Another day brings another unthinking left-wing Facebook associate joining another idiotic group:

Robin Hood Tax is a tiny tax on bankers that would raise billions to tackle poverty and climate change, at home and abroad.

If governments took a tiny tax of 0.05% from international bankers’ transactions, it could generate hundreds of billions of pounds every year – that could stop cuts in crucial public services at home in UK, and help fight global poverty and climate change.

This is so irritating in so many ways that it really is a case of some many gripes, so little time. So I’ll focus instead on my biggest issue with this craptastic idea. It isn’t so much the damage this might do to an already struggling banking sector, nor the naïveté involved in the idea that the whole world could agree on one particular point of economic policy, when they cannot even agree on what the best basis of an economy should be. It isn’t even the ongoing stigmatisation of the banking world, despite the reality that others – such as governments and consumers – also played a crucial part in the down-turn we’re just coming out of.

No. What really fucks me off is this naïve assumption that government knows best. That if you give money to government you are automatically doing a good thing. That is, of course, total shite. Don’t believe me? Well, let’s take a look at what the British government spends its money on. War and (generally poor, not fit for purpose) weapons. More CCTV cameras, more invasions into the privacy of the people. And – best of all for these banking haters – buying large stakes in failing/failed banks. Yeah, let’s give the governments more money. Because they don’t waste it now, do they?

And this notion that the money will be used to stop crucial cuts in public spending at home in the UK – bollocks. If the government gets around to making cuts in public services, then than can do so by cutting out some of the waste within the public sector.

The Robin Hood Tax is perfect propaganda for the government. It subtly yet effectively reinforces the idea that the government is a benign entity that will do more and more good the more money we all give to it. Unfortunately, the government is not benign. It is both wasteful and, on occasion, extremely malignant. Licensing the government to take more money from the private sector is like giving a gambling addict 200 quid and pushing him into Ladbrokes. It is stupid, it is dumb and it is irresponsible.

The Robin Hood Tax – stealing from the rich to give to the incompetent. Unfortunately, the ineptitude of the government ensures any money they take from banks will not reach the poor.

And?

The Guardian tries to turn a story about one of the directors of the Taxpayers' Alliance not paying tax into some sort of a scoop. Which is kind of ironic given The Guardian's record when it comes to taxes. Anyhoo, the newspaper shrilly writes:

The Guardian has learned that Alexander Heath, a director of the increasingly influential free market, rightwing lobby group, lives in a farmhouse in the Loire and has not paid British tax for years.

They cite a response from the TPA:

"Mr Heath, a retired teacher, has lived in France since marrying his French wife in 1973," said Elliott in a statement. "He is still a British citizen but he is a French taxpayer (where taxes are higher than in the UK!). He is passionate about the Taxpayers' Alliance." Elliott said Heath returned to the UK for about a fortnight each year and owned no property in Britain.

I'm sure I'm not the first person to say this, but I will say it anyway - why the hell would it matter if Elliott pays taxes in this country or not? Surely we aren't saying that in order to have an opinion on the taxes in a particular country you have to pay taxes there? I mean, there would be no shortage of opinions from Guardian journalists on taxation in the USA; yet I'd imagine precious little of them actually pay taxes in the US.

Frankly, I would be more worried if Heath did pay taxes in this country despite being resident abroad. That would reek of hypocrisy and stupidity. As if stands, Heath comes across as a concerned observer; his tax status is supremely irrelevant to the debate about whether the taxation levels in this country are acceptable or indeed in anyway defensible.

Taxation Fraud Targets

News reaches your humble author of an incentivisation scheme within the civil service:

The Times has learnt that £44,000 in bonuses for the “most senior staff” at the Revenue & Customs Prosecution Office (RCPO), which pursues tax fraud cases, were linked in part to hitting confiscation targets.

Sounds good on face value. Yeah, the public sector should incentivise its workers to get the best from them. Although here, the results are good only for the ever greedy public purse. The penalties are, shall we say, a little draconian:

In one recent case, 16 people convicted in a £3.2 million VAT fraud conspiracy were each ordered to pay back £3.2 million — a total of £51 million.

In another case a pharmacist who had overclaimed £464 in VAT was subjected to a confiscation order of more than £212,000.

Right. Now, I'm all for those committing crimes being punished, but a fraud of just under £500 carrying a penalty of just under a quarter of a million pounds seems a little excessive. Particularly since those pursuing the conviction are incentivised to get as much money as possible from the guilty party.

Still, this is Britain, so at least people will get a fair trial, so perhaps we can rest a little easier with the incredibly harsh penalties:

In other cases, where defendants’ assets have been frozen before trial, there have been complaints that they have been hampered in mounting their defence; for example, they have been unable to hire expert witnesses.

Magic. So the government incentivises people to get as much money as possible from those accused of fraud, and then it turns out that certain things happen that reduce the likelihood of the accused people getting a fair trial. I don't know about anyone else, but this absolutely screams at me as something that is horrifically wrong.

Sir Ivan Lawrence, QC, said he was uneasy about “manifest injustices” in confiscation proceedings that were compounded by the setting of targets. Sir Ivan, a former Conservative MP and chairman of the Home Affairs Select Committee, said: “Once you start setting targets you are saying, ‘Never mind justice.’ Bodies like RCPO have to make a judgment on the cases they pursue — if they make that judgment on the basis that they will receive a lot of money, it calls into question whether justice is going to be done.

“There are indications that the Court of Appeal is uneasy about some of these cases, but the astonishing thing is that no one is up in arms about it.”

Well, quite. We should all be up in arms about this. It has nothing to do with justice; it is governments trying to get as much as they possibly can from their people. It represents an absence of justice, and the draconian power of an ever more arrogant state.