Andy Duncan has heard the voice of
MetatronPeter Hain and he is pretty sure it may have been Hain’s lips that were moving but it was Tony Blair’s voice we were hearing
On the BBC Today program this morning, Labour Party Leader of the House of Commons, and Secretary of State for Wales, Peter Hain floated the idea of increased income taxes. As he’s the semi-official Voice on Earth, for the internal workings of Prime Minister Tony Blair’s mind, his attempt to start this ‘debate’ can be assumed to have been cleared by Downing Street.
Is this the last desperate throw, by an increasingly desperate Prime Minister?
In the interview, the BBC Radio 4 Presenter, John Humphrys, tried to press Mr Hain on this ‘debate’, but didn’t get the minister further than saying the rich would be ‘asked’ to contribute more, for the common good of the public services.
Mr Hain refused to define what is ‘rich’, and refused to define how much income tax would be going up by, except to say it wouldn’t be “punitive”.
Mr Humphrys put forward the figures of £50,000 pounds a year as being the Labour Party’s definition of rich, and 60% per cent income tax, as being a ‘fair’ contribution. Mr Hain did not refute these figures, merely avoided answering the questions in his self-styled ‘debate’.
Given that Tony Blair hinted at more tax increases, earlier in the week in his Fabian Society speech, it seems he is ready to formally break his 1997 ‘pledge’ to not increase income tax.
But does this really signal it’s time up for Tony Blair?
Andy Duncan
Is that 60% on total taxable income, or a 60% rate on some “top margin” number; either way, that is ghastly beyond comprehension!
“Is this the last desperate throw, by an increasingly desperate Prime Minister?” … “But does this really signal it’s time up for Tony Blair?’
You guys really do live on Planet Mars, don’t you? There is no earthly chance of Blair being ousted from within the Labour Party, or being beaten in the next election (not while IDS leads the Tories, at any rate). Where, precisely, is the threat to Blair coming from?
I think that this could justabout be the tipping point.
Leading the tory party would no longer
be the poisoned challice it was even a few months ago. The Tories are only about
4 points behind labour in the opinion polls.
I’d put a wager on IDS being replaced within months.
Becky enquires:
“There is no earthly chance of Blair being ousted from within the Labour Party, or being beaten in the next election (not while IDS leads the Tories, at any rate). Where, precisely, is the threat to Blair coming from?”
As Harold Macmillan famously remarked: ‘Events, dear boy, events.’
Blair is holed beneath the waterline and only his most purblind supporters don’t see it. Listen to Labour activists. Listen to Labour’s paymasters, the Unions. Count the remaining Blairites. Count the bodies of those who have fallen. Both he and ‘the project’ are history waiting to be written.
True, the Tories might not win the next election, but the odds on Blair surviving much beyond it, grow smaller by the day. Indeed, he might not even survive to lead his tattered party into it at all.
Higher tax rates on top earners will not give Peter Hain the higher tax revenues he wants.
Where tax rates are too high, people try (legally) to avoid them or (illegally) to evade them. Or go abroad. So the Treasury loses out.
When Nigel Lawson cut the top tax rate from 60% to 40% the e share of tax paid by the top 10% of earners rose from just over a third, to nearly half of the total.
Hain would raise more with a flat-rate tax of just 28% than he could by trying to ‘soak the rich’.
“You guys really do live on Planet Mars, don’t you?”
Becky,
I have lost count of the number of times you have opened your ‘outraged of Orpington’ comments with that tired, clapped-out bit of barracking. You really ought to find something more substantive. Or at least something new.
You learn something new every day. If you had asked me what a [i]Metatron[/i] was, I would have guessed that it had something to do with Scientology.
No comment on whether Christianity or Scientology is a more appropriate analogy when discussing the Blair regime. 😉
David,
Sorry to have subjected you to my tired and the clapped-out barracking. Must try harder, eh? Perhaps you and your fellow samizdatistas could make a similar small effort to tone down the hysteria – it would do your credibility no end of good. To suggest that Blair is on his way out because one of his ministers suggested higher taxes for the rich, a suggestion both Blair and his chancellor have since firmly opposed in the afternoon papers, is really getting a bit much. A bit like your recent suggestion that the French nation was in meltdown because of a strike (which has since dissipated).
You know when the bath water is too hot and you lower yourself in a bit at a time. Perhaps lift yourself back out a little and wait until the bit of your body still in the water gets used to the heat. Then slide in another inch or two. No? Probably just me then.
However this is Labour’s MO. Have a lacky run an idea, however half baked, up the flag pole and test the reaction. If it’s a positive one all well and good. Aren’t we a great government responding to the public will like this. If the reaction is poor that flag comes straight down and Blair and his chancellor firmly oppose [the idea] in the afternoon papers.
But that won’t be the end of the tale. In a month or so the idea will be repackaged and presented as a whizz bang shiny new idea once again. Oh Joe and Josephine Public aren’t keen on ID cards, okay then what about these wonderful entitlement cards, throw in a few key phrases to be lapped up by the potential BNP voters asylum seekers, terrorists, schools, hospitals and perhaps the reaction this time won’t be as bad.
Perform the trick a few times and we’ll all be neck deep in the bath just like a metaphorical boiling frog.
Just wait, next budget. “Just this minute Mr Wanless has e-mailed me this report.” And before you can say brain drain, “Yup. It confirms to me that only the health secretary can know how to spend 0.35% of planet Earth’s wealth on healthcare. Sorry folks taxes up”.
Yep, the welfare state just gets “freer” by the minute, doesn’t it?
Becky,
Oh do knock it off. You surely must get some kick out of the fire and brimstone we like to trade in occasionally. Something keeps drawing you back here that’s for sure.
If you bland-as-custard, middle-of-the-road reportage I suggest you stick to The Times.
Even if it was a Blair idea he will never admit it now. Especially after “The Treasury” AKA Gordon Brown came out against it so strongly.
Still if he really wants to get the upper hand it’s not a very clever way of usurping Gordon Brown.
And as for the Tories winning the next election well who knows? But don’t worry as Tony Blair said during PMQ’s this week we have been implementing Conservative policies from their manifesto*
*You could hear the groans of the Labour backbenches when he said it*
Hey, raise taxes I say! Every time New Labour yet again makes British life marginally less tolerable, the US benefits from a few more boat-loads of bright, ambitious Brits who have had enough.
In fact, my daughter married one on Wednesday: an “asylum seeker” from Hertford, now residing in pleasant, prosperous Richmond, Virginia.
I can think of at least one world leader in the not too distant future who lost his job when he broke a campaign pledge on taxes; it certainly isn’t a hysterical suggestion to ask if the same might happen to Blair. Especially not if enough of a fuss is kicked up about it.
Either way, no one’s living on Mars as far as I can see…except maybe someone who suggests there is “no earthly chance” that Blair could be beaten at the next election. I guess earthly chances look a bit blurry from Mars, though.
There are plenty of possibilities with this one. My personal haruspex just comes up with chopped liver–à la Becky–not prepending cataclysm. New Labour is still very competent, very in charge of itself, sad to say.
Best guess this is Hain putting down his marker as a potential leadership candidate in due course–an independent thinker (gods help us), not a Tony crony–now that he has a power-base as Leader of the House.
Could be approved, but deniable, kite-flying by the government just to guage reactions before politics is forgotten for the summer. (Note, they frequently rush out a lot of contriversial new things at once at such times.)
Could be put up just in order for Blair to slap him down and remind middle England why it voted for them.
Could be… (I could go on…)
Most interesting, I thought, were some of the terms of Hain’s proposal: higher rate tax is unacceptable at such and such a level because various public sector workers have to suffer it… Somehow the same taxation is morally worse if paid by a policeman rather than a burglar alarm salesman, or a nurse, not a personal trainer. It is the same interesting thinking as that providing subsidised housing for “essential workers” in London. Somehow in the latter case state employees are essential and others whose services we still all need–grocery staff, sewerage men, etc–aren’t.
Becky writes:
Where, precisely, is the threat to Blair coming from?
Ah Becky, you funster! 🙂
Just where do we begin? The 60% of people in this country who were opposed to the Iraq war, who feel they’ve been lied to by Dear Tony, on WMD. The 90% of people in this country who want a vote on the Euro Referendum.
There’s more. There’s Robin Cook (a very nasty enemy for anyone to have, ask John Major), who, despite a mutual loathing with Gordon Brown, may have struck a deal with El Gordo to bring Tony down, in return for first-class flights and a Cabinet post in Gordon Brown’s premiership (eg: Education). Clare Short, Gordon’s bestest friend, and Secretary of State for Defence in Gordon’s premiership.
There’s more. All the small-c conservatives who voted Blair in, in 1997, because of his “pledge” not to raise income tax. The increasingly left-wing Union leaders. The doctors of this country who are threatening to work-to-rule, and only do their contracted 35 hours a week, and not the 13 extra hours they currently do each week.
And there’s more. David Blunkett, Gordon Brown’s Chancellor, in his premiership. Jack Straw, Gordon Brown’s continuing Foreign Secretary in his premiership. Every sacked Labour junior Minister (Frank Dobson, et al).
What’s this? Yes, there’s even more. The 100% of people in this country, who no longer believe a word Tony Blair ever says, and never will again, on any subject at any time.
And of course, finally, the Forces of Darkness himself, step forward The Right Honourable Gordon Brown MP, Chancellor of the Exchequer, and this country’s next Prime Minister. Bye bye, Tony. Close the door on your way out, there’s a good chap.
You could though be right about the Tories. It by no means a certainty they’ll win the next election. Even privately they admit it’s too much a gap to take back in one go, and they’re planning to win in 2009. But just imagine the fun they’ll have in the next Parliament, even if they lose, and Labour somehow survive the gathering crisis of the Euro Constitution. (Have you seen today’s Economist front page story, BTW?)
Assuming Labour win it, Gordon Brown becomes an increasingly unpopular PM, who runs out of borrowing room, and presides over a collapse in public services, his working majority is between 20-40, and every bill gets holed, and needs three line whips to scrape through, before being mauled in the Lords. He still chickens out on the Euro referendum, or if he holds it, he loses it. This doesn’t even include the unpredictable time-bomb of the Euro Constitution, which gets more bungled by the day, and which could easily lead to the Tories’ victory in 2005 just by itself.
Oh Becky, Blair is finished. The only question remaining, is whether Brown is finished too, before he even gets going.
Have a nice weekend. The gin and tonic is calling me from my sunny back garden in reactionary Henley-On-Thames. It’ll be the Regatta soon, and time for cucumber, mint and Pimms. Chin, chin! X-)
Andy Duncan – Sleainge! – and thank you for a lucid piece. I think the rancid Gordy’s finished before he gets started, and that is the way of life for ugly self-righteous gits. Tony’s finished six years too late, but better late then never. He had earlier expressed an interest in saving Africa so he should go over and decide which country he’s going to save and which has the most photogenic tribal wear and fly switches. Clue to Tony, don’t go anywhere where the chief’s wife does tribal dances in a thong. The saris were painful enough.
If ideas of raising taxes on people just a bit richer than whoever it is swings marginal constituencies are being floated to soften us up – as so often with Eurointrusions – we have an opportunity.
This is a chance to grapple with the challenge of reminding ordinary people that everyone owns their own money, even rich people. Utilitarian arguments like “the rich will emigrate” are convincing and can win a battle or two, but often concede the campaign.
We have to stop relying on the claim, however true, that taxing rich people is bad because it is impractical. This lets the idea slip in that it is otherwise a defensible, morally neutral decision we make when deciding how much money to ask our government to take off people richer than ourselves.
It’s a nettle we need to grasp. Money and things belong to people and this is independent of whether those people are vulgar, wear ostentatious clothing, talk loudly in bars, drive naff, flashy motor cars and so on. We always need to carefully justify and defend decisions to take more of it off them.
Britons have lost sight of the idea that people own things before the government acquires those things. We need to return to this idea. Other people’s things belong to them, whether we like those people personally or not.
One reason that the Democrat’s “soak the rich” rhetoric strikes so few sparks here in the US is that many people honestly believe that they will be rich themselves someday, or, at a minimum, that their children will be. Thus, “soak the rich” is heard as “soak you” by a goodly chunk of the non-rich, and class warfare reaps what it should in a highly mobile society.
The Republicans, living up to their nickname (the Stupid Party) haven’t really made much of this. I wonder if this is uniquely American, or if it could get some traction in Britain as well.
One reason that the Democrat’s “soak the rich” rhetoric strikes so few sparks here in the US is that many people honestly believe that they will be rich themselves someday, or, at a minimum, that their children will be. Thus, “soak the rich” is heard as “soak you” by a goodly chunk of the non-rich, and class warfare reaps what it should in a highly mobile society.
The Republicans, living up to their nickname (the Stupid Party) haven’t really made much of this. I wonder if this is uniquely American, or if it could get some traction in Britain as well.
Yes, the tax situation in the US is laughable, and the Stupid Party (thanks, T. Hartin) hasn’t a clue how to work the situation to its advantage.
Just the other day, I read that (in the US) 27 pc of all income tax is paid by the top one (1) pc of taxpayers. I believe (my memory is less certain on this) that about 50 pc of taxes come from the top 5 percent of taxpayers. Meanwhile, the bottom 30 pc pay no taxes at all!
And so, when a tax cut such as that of George W.’s is announced, the Democratic party pounces on it immediately because it (ta-da!) “favours the rich”. But of course it favours the bloody “rich” because they’re the one’s who pay taxes.
A flat tax is the only way to go. Then, everyone pays taxes, and therefore everyone has a stake in what the government spends.
Do I expect that a flat tax will happen (in the US)? Yeah, about the same time that pigs fly.
“Just the other day, I read that (in the US) 27 pc of all income tax is paid by the top one (1) pc of taxpayers. I believe (my memory is less certain on this) that about 50 pc of taxes come from the top 5 percent of taxpayers. Meanwhile, the bottom 30 pc pay no taxes at all!”
George… I haven’t seen very recent data, but the last I heard it was even higher than 27%. The wealthiest 1% was paying well over one third of all income taxes, and the wealthiest 10% was paying over two thirds of the income taxes.
George Peery – a small proportion of the population pays a high proportion of the total tax under a flat tax, too. Conversely ordinary “progressive” income-tax system is flat beyond its highest step, so if your income is high enough, any progression will be ironed out from your point of view.
The seeming merit of a completely flat tax in giving everyone a stake in lower taxes might be outweighed by a number of factors.
Unless it’s accompanied by abolishing all support for the poor it effectively exacerbates perverse incentives at the bottom. (The British tax-system does this already in spades: income tax is payable quite a lot below the official poverty line.)
Further, collection costs at the bottom of such a system vastly outweigh the tax collected. If you advocate a totally flat income tax, then you must accept this is the same as demanding taxes for some merely because paying taxes is somehow morally improving (!) and higher taxes for the rest in order to achieve moral improvement in others.
If one must have an income tax (and I’m not totally convinced it’s ultimately necessary, but it isn’t going to be possible to abolish it tomorrow as if it were some fundamental constitutional principle) then there’s going to have to be a limit of income below which one doesn’t pay.
An upper limit to the total amount an individual should pay is the only solution to the distribution issue that exercises you, and is interesting. How would one go about deciding an appropriate level?
I notice that Peter Hain’s little fireworks have relieved some on the pressure on Tony Blair over WMD, Lord chancellor, Euro constitution etc etc. I suspect that he will be quite happy with the result.
Actually I could see Hain’s proposal being rather popular.
The Welfarista won’t care as they don’t pay tax anyway. Ditto the criminal and related under-classes.
It would virtually guarantee Labour the entire bloc vote of public sector workers and associated hangers on.
Some of the Middle Classes would defect to IDS, but the majority will stay with Blair out of social democratic class guilt.
Obviously the producers in society – those who actually create true wealth (from plumbers to CEO’s) will vote for IDS. However, they are a minority anyway so their votes don’t matter.
And as for the lesson of the 1970’s? Well you have to be touching 40 even to remember Healey and his disastrous reign.
Cydonia
Recent and historical US income tax data, including distribution tables by income range, is available from TaxFacts at the TaxPolicyCenter (link via EconoPundit.)