What’s Laffer got to do with it?!?!

There will be no reduction in the tax burden for five years, states Chief Secretary to the Treasury Danny Alexander in an interview in the Observer.

‘The tax burden is necessary as a significant contribution to getting the country’s finances in order. So, it will have to stay at that level for quite some time’.

When asked whether or not a reduction in the overall tax burden would be possible once the nation’s books were back in order, Alexander adds: ‘You are asking me to make decisions for five years down the line now and I am not going to do that. What I want to see is a rebalanced and fairer tax system. That is what I think is most important’.

Now the economic times are dire, yes – but that really was a counsel of sheer despair. It’s hard to give Alexander credit for his glass thoroughly half drained future outlook… Perhaps the coalition is running the risk of being bitten by its’ own negativity?

MPs concerned with their left flank constructed a budget with “progressive” stamped all over it. When that notion was challenged, by the IFS, they then had to elaborate- claiming that they have no intention in cutting the tax burden or moving towards that direction for at least five years. So, they can only prove that they are being “fair” by being redistributive. Anyone who suggests there is another way surely must want to stamp all over the faces of the poor…

But surely the answer to Britain’s deficit and other problems is not a constraint on public sector spending. The answer may just be sustained growth.

Fortunately/unfortunately, whatever, Britain’s economic success is linked to global demand, and developments in the U.S., in China and of course, in European economies such as Germany (with enviable levels of economic growth). Wealth is also not just created by governments but by the individual and enterprising companies, propelled by what Keynes called “animal spirits”.

However, the government does have control over the tax system. It can keep tax levels high to make a political point, you know -“fairness,” but only at the cost of inhibiting growth. A high tax take and tax rates, more recently known fondly (!) as banker-bashing policies will just have the bankers quietly running to the arms of other nations, think Switzerland and the East…

Maybe, just maybe, Alexander needs to get acquainted with Art Laffer, (still alive) the economist of the Laffer Curve fame. The curve points out, among other things, that the best way to increase revenue was to get the rich to pay less tax… No, NO, LET ME FINISH – the curve points to incentivising wealth creation by lowering taxes, domino effecting growth in a positive way and leading to increased tax receipts…

The other option, which the coalition has chosen to embrace, is to raise the taxes up so high that bankers will simply move abroad. Good riddance you say? No. No it’s not. If the top 1% is paying 23% of our tax revenues, how is it in our interests to drive this money away? Does that not leave us with 23% of the money short? Think about it…

Or let us let Camberwell’s most famous son put it: ‘I left for eight years when tax was put up to 82 per cent. The newspapers said: “Michael Caine’s leaving: let him go, the stupid, overpaid, loudmouth idiot, who cares where he goes?” Well, you didn’t get 82 per cent tax from me for eight years and a quarter of a billion dollars worth of movies were made outside this country instead of inside it. Now, that is just from one stupid, loudmouth moronic actor. Imagine what happens with companies that disappear.’

Force them to learn something in foreign!

It’s hard to hate the latest announcements of welfare reforms. In these financially tight times we can’t carry on being the nanny-state everyone has gotten so used to…

It’s not about picking on the unemployed but about everyone doing their bit. Lots of us work crazy hours for less money than some seem to get in benefits. Of course, not all unemployed are scrounging off of the state; just think about the thousands of graduates finding it hard to get into work…

However, there must be quite a few people doing cash work and claiming benefits, or living in a three bedroom council house and renting it out, courtesy of us truly. This is neither right nor fair.

There are exceptions, of course – let’s not pick on anyone who is a genuine case for not being able to work either – e.g. someone looking after a sick partner who needs 24hr care. We should never become a society that punishes the poor for being poor, or the sick for having become so…

Maybe help for the handicapped, who would probably appreciate the help. Do their gardening, pick up the groceries, clear the path when it snows. Or have I misunderstood the ‘Big Society’?

The idea of training an individual to the needs of the workforce is smart. A company goes to the dole office to find the workers it requires, and the dole office then pay for the training that the worker will need – I mean, matching an individual to the markets’ needs happen all the time in job agencies anyway…

But just what will having people picking up little for 30 hrs per week do to help him/her get into the jobs market as a skilled worker??? Plus, what exactly are the criminals sentenced to community service do instead? Work the summer months helping our cash-stripped farmers? And more importantly, what will this cost the rest of us, you know, the TAX PAYER?

Maybe we could switch off the mind-numbing rubbish that passes for daytime TV instead? That should get a few people to shift gears. How about from now onwards, daytime TV consists of news and educational shows. 
OR – to really up the ante – foreign languages!!! ‘Work or we’ll force you notoriously-bad-at-languages Brits to learn something in foreign!’

Close the pubs and arcades Mon-Friday during the day. (Although that will also punish the already depressed and hard-up student folk!) Ban selling alcohol and cigarettes to anyone on benefits? Am I just getting a tad carried away with the stereotypes? Probably.

Branding the foreheads of those who just plain refuse to work? No, too far? Ok.

Poor Trisha and Jeremy Kyle, their viewing figures will nose-dive!!!