The Autumn Statement was a tragic miscalculation, the final failure of a project to undo the gravest mistakes of the New Labour era and shift the UK in a more dynamic, more conservative direction. Lacking any meaningful plan for economic growth, and postponing many of the most difficult decisions on spending until after the next election, the Statement passed the costs of a ballooning state onto the productive parts of the economy when disposable incomes are collapsing. It was a victory for the Treasury technocrats who have resisted every attempt to move the UK away from Brownite orthodoxy.
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Samizdata quote of the day – Tory doom spiral editionNovember 20th, 2022 |
 31 comments to Samizdata quote of the day – Tory doom spiral edition |
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“The Autumn Statement sets out reforms to ensure businesses in the energy sector who are making extraordinary profits contribute more. The Energy Profits Levy will be increased by 10 percentage points to 35% and extended to the end of March 2028, and a new, temporary 45% Electricity Generator Levy will be applied on the extraordinary returns being made by electricity generators.”
Taking profits away from shareholders and “contributing” them to bureaucrats is always a wise decision.
Let me FTFY
‘Voting Conservative in December 2019 was a tragic miscalculation, the final failure of a project to undo the gravest mistakes of the New Labour era and shift the UK in a more dynamic, more conservative direction.‘
I now have no doubt that a Corbyn victory in 2019 would have been a better result for liberty and the economy.
Clearly voting Tory to keep Corbyn out of Downing Street was essential, the vilest mainstream politician since Oswald Mosley. But sadly I greatly underestimated just how debased the Conservative Party had become institutionally.
@Fred Z
Taking profits away from shareholders and “contributing” them to bureaucrats is always a wise decision.
I can’t read the original since it is behind a paywall, but as I was reading your excerpt I was wondering if anyone at the treasury ever took a course in economics? In a supply and demand economy when the demand exceeds the supply the price goes up and suppliers make more money. But what is that money for? Well it is supposed to be for increasing the supply either by the current suppliers investing more, or by competitors seeing the greedy bastards and trying to syphon off their profits by providing alternative supplies. This is not some brilliant insight by me, it is what you’d learn in the second or third week of Econ 101. It is the basic method of regulating a free market.
For sure, that money is not there to fund valueless government boondoggles, and it is DEFINITELY not there to fund various schemes by the government to reduce supply even further!!
It is a classic example of: the government causes a problem then rushes to the front of the parade with a “solution” that never seems to work in alleviating the original issue but does grant to them large amounts of extra power, bigger budgets and massive self righteous bouts of virtuous preening about their own goodness.
It happens this way with such complete regularity is almost as if it is done that way by design.
Perry,
I don’t doubt that Corbyn as PM was a vile prospect, but in office he might have faced some opposition and internal dissent, (and advice from his brother) which might have meant the final outcome would not have been as bad as things are up to now and looking forward.
That’s how bad it is. At present, we have a wannabe Labour government opposed by an emboldened Labour Party, who only say ‘Do more, faster’.
Michael Portillo is sounding like a ‘Conservative’ in this clip, saying that the latest Conservative spending plans are worse than their most lurid scare stories about Corbyn, and it may be the end of Conservatism.
When there is demand-pull inflation, putting up taxes might make some sense to reduce the excess money chasing too few goods & services. But we have mostly cost-push inflation, caused primarily by surging energy costs (but not just that of course) at a time when earnings have stagnated or actually shrunk.
So what do our governmental masters do? They increase taxes and in particular petrol taxes. They are quite literally making inflation worse. Idiocy or something else?
What does history have to tell us about the end game for rogue regimes?
Do they have a happy ending?
How do the hoi polloi deal with bad leaders?
What is the probability we’ll see light at the end of this miserable tunnel?
The first thing to remember is that government spending is going UP – it is going to be higher in 2023 than it is in 2022.
Whether one measures things in cash terms, “real terms” (“inflation adjusted”), or percentage of GDP, government spending in 2023 will be higher than it is in 2022.
So, if you see or hear anyone claiming that government spending is being cut – please correct them, as government spending is being increased. It is being increased not just on the elderly, but on just about everything – from defence, to education, to even the utterly absurd “HS2” (a railway project Money Pit).
Taxes are also being increased – and not just on “the rich”. Taxes, overall, are already at an all-time high – and Chancellor Hunt and First Lord of the Treasury Sunak (the former Chancellor under Prime Minister Johnson) have decided to increase the level of taxation still further.
Lastly regulations are being increased, there is to be no great deregulation – on the contrary, as Chancellor Hunt explained last Thursday, regulations such as the “Living Wage” (and many others) are to be increased.
That is the context we find ourselves in, in the United Kingdom.
And more, the UK Daily Telegraph (paywall) claims that had Johnson sought a dissolution of Parliament and a General Election rather than resign, the Queen would have been ‘unavailable’ for a dissolution.
If it had been so, it would have justified the abolition of the monarchy forthwith and a return to something like the unpleasantness of the steps taken to maintain the (notional) rule of Parliament in the aftermath of the defeats of the Royalists.
@Perry de Havilland (London)
When there is demand-pull inflation, putting up taxes might make some sense to reduce the excess money chasing too few goods & services. But we have mostly cost-push inflation, caused primarily by surging energy costs (but not just that of course) at a time when earnings have stagnated or actually shrunk.
Your economics is no doubt better than mind, I had to look up those two terms. But demand pull inflation is exactly the wrong time to increase taxes. Instead that “excess” money needs to be turned over to people who will help alleviate the shortage causing it. So taking the money out of the system and pissing it away on pointless government boondoggles (which will also, BTW, sop up some of the supply, causing further shortages) is the absolute worst thing to do.
And as to cost push inflation, very often tracing back to the root, the cause of costs going up is government interference, so more government is not the answer. But even if that is not the case once again we need that extra money (in the form of higher prices) to find ways to reduce those costs. For example, if the price of nickel is soaring sending up the price of EVs, that money can be used to find new nickel sources or alternative battery chemistries, or if it is caused by wages going up, the money can be used to invest in new technologies to eliminate the need for some of that labor.
And of course the most common cause of inflation? Printing masses of money without any value backing it. In all cases increasing taxes are the worst response to inflation. It sops up the money that can fix the problems and redirects it to politically favorable things, making everything worse.
Presumably it is a trivial exercise to apply this to the price of energy which has the unique feature of being affected by both. But as I have said before if people are so stupid to vote back in a government when the insanely bad effects of that government is in their face apparent every time they drive their car or buy their dinner, well then there really isn’t much that can be done for a country populated by people that dumb.
Mr Ed,
Yes, I saw that. I presume the same trick would have been pulled on Truss had she tried to call an election.
Liz Truss was appointed PM by conservative MP’s and party members. The general public had no say.
Rishi Sunak was appointed PM by conservative MP’s. The general public had no say, neither did party members for the second time in 6 years.
Would any “conservative” have a right to complain if the next PM was simply chosen and appointed by, say, the Privy Council?
It’s lucky we’re not still in the eu.
Mr Ed (November 20, 2022 at 9:41 pm), I wouldn’t trust that story you mention. The Queen was about duty and it was certainly her duty to meet with the prime minister. It is also for her, not for others, formally to dismiss a PM as it is for her formally to appoint one; I don’t see her letting that detail be taken from her.
The same people who arranged the removing of Truss would doubtless have had a great problem with the idea of l’affaire Boris being settled by an election instead of by them, but I see no reason to suppose the Queen would have agreed.
As Boris did not advise a dissolution and her majesty is dead, anyone can say what they like now – and I can go on distrusting the kind of behind-the-scenes wire-pullers whom I suspect of originating this.
It seems to hinge on whether or not there has to be an election after the government loses a confidence vote.
Mr Ed and Perry.
If the alternative Prime Minister over the last few years had been Piers Corbyn, who was anti Covid lockdown and anti “Net Zero” as well, then YES such as administration would have been less bad than Mr Johnson and co – but the alternative in 2019 was not Piers Corbyn, it was his younger brother Jeremy Corbyn.
By the way – Piers Corbyn is terrible in various ways, just not as terrible as policy since 2019 has been, on Covid, Net Zero, and so on.
I believe that a Prime Minister Jeremy Corbyn would have gone along with “the science” (i.e. the Collectivist demands of the international Cprporate State) on Covid and “the Climate Emergency” – and he would have added his own nasty agenda on top of this.
John – no.
Liz Truss was elected by party members – not appointed. And Liz Truss was in 2022 (whatever her other faults may be) loyal to the principles the British people voted for in 2019 – indeed less disloyal to those principles than Mr Alexander “Boris” Johnson was.
Mr Sunak was not elected by party members or MPs – there was only one candidate, due to the rules the 1922 Committee imposed and the pressure on Mr Johnson to stay out.
Mr Sunak was appointed by “the markets” (not really Members of Parliament) – and we must remember that “the market” has nothing to do with a market in the way, say, Adam Smith or Milton Friedman understand that term. Due largely to the Cantillon Effect “the markets” are a handful of vast Corporate entities backed by the Credit Money of the Bank of England and the other Central Banks. Mr Sunak and Mr Hunt (Mr Hunt was defeated in the leadership election against Mr Johnson) will faithfully follow the cultural and economic policies of “the markets” i.e. of these few vast Corporate “Woke” entities (which is what the term “the markets” now means) – for example their Environmental and Social Governance agenda (Agenda 2030 and all that).
However, in fairness to Mr Sunak, he is the democratically elected Member of Parliament for Richmond.
Also, as Mr Sunak is very wealthy, he could (if he wished to do so) break with the “Woke” cultural agenda of “the markets” and with the international Corporate State economic agenda of “the markets”.
They, the handful of vast corporate entities (backed by the endless Credit Money of the Central Banks) that are “the markets”, could not really hurt him if he did break with this cultural and economic agenda – but he does not appear to wish to do so. It would be nice if the Gentleman were to change his mind about this.
Paul:
I think we both know that Rishi Sunak is a squish. He seems to have no principles, and has risen without trace in 7 years to have become the British prime minister. He won’t stand up to anyone or anything. He will lead the Conservative party to electoral defeat in 2024 like a good boy.
I thought conservative values included people being self sufficient? That is not dependent on the state aka others? Yet we have fuel payments because they’ve made our energy creation dependent on fuels supplied by other countries. Rather than bending over to the green brigade, they could be generating using cleaner coal power stations. Pushing small nuclear. Not raising the taxes on petrol and diesel. There is no conservatism in the Conservative Party. No preservation of our way of life and culture by limiting immigration. No protection of our democracy by adhering to treaties on refugees that are not fit for the 21st century.
Stuart:
You mean the current “Conservative Party” stands for nothing which could be called “conservative”? I think you may have a point.
JohnK:
I’ll draw your memory to something written by a former Conservative leader:
http://news.bbc.co.uk/1/hi/uk_politics/3361933.stm
Stuart:
If Michael Howard still believes those things, what is he doing in the “Conservative Party”, which seems these days to believe in none of them?
JohnK.
I try not to think about Mr Sunak and other “Western leaders” more than I have to, I find the whole subject deeply distressing.
I am sure you feel the same way Sir.
Too true Paul.
This report from an Indian news station on the changes reportedly being brought in by the new Swedish government strikes a surprisingly vigorous tone. I thought it might be a spoof, but it seems not.
I can’t imagine ‘owt like this happening in the UK under our much more measured and considerate Conservative Party.
JohnK:
I’ve never shared this with a group yet who actually understands the significance of it. I draw your attention to paragraph 2.
https://www.econlib.org/library/Enc1/PublicChoiceTheory.html
Mr Ed – we will have wait and see how successful the new Swedish government is. Sadly, in the United Kingdom officials and “experts” seem to have the real power – and are backed by the courts (I would like to be proved wrong on that).
Stuart Noyes – there is some truth in the Public Choice theory, but the real problem is not corruption (politicians doing things for votes and campaign contributions) the real problem is terrible beliefs – among the “educated” generally.
Public choice theory doesn’t focus on corruption. It simply explains what we all know to he true. Representatives primarily act in their own interests.
Stuart Noyes – “what we all know to be true” is NOT true.
Generally politicians in Western nations do not act in their own best interests – if only they did. Generally politicians follow the advice of officials and “experts” that lead to terrible results – the politicians are then voted out of office, and replaced by other politicians who follow the advice of officials and “experts” with similar terrible results.
If only “what we all know to be true” was true – but it is not.
The only way it could be argued to be true is if we accept the “paranoid conspiracy theory” that if politicians did not follow terrible policies they would be removed and replaced by politicians who did – so that following terrible policies (policies that will lead to disaster) becomes in the “best interests” of the politicians following advice they know will lead to disaster.
However, that is over egging the pudding – it is too depressing, even for me.
For example, nothing happened to those American State Governers who refused to impose lockdowns – and nothing happened to most of the rulers around the world who refused to impose lockdowns.
Generally speaking “ideology”, a fancy word for beliefs, is a better predictor of how a representative will vote than “self interest” (whatever “self interest” is supposed to mean).
The idea that politicians, even in legislatures, are “vote maximisers” may be true at the margin (on some matters) – but generally it is false.
For example, “Liz Truss” (or Mrs Elizabeth O’Leary) tried to reduce taxation, and Mr Sunak and Mr Hunt have increased taxation.
The voters of Richmond North Yorkshire are not demanding higher taxes – Mr Sunak will not get more votes by increasing taxes, he (and Mr Hunt) have increased taxation because that is what the officials and “experts” have told them to – and they, most, likely believe in this sort of thing anyway (even in my youth Mr Hunt was know to be someone who sneered with contempt at free market ideas).
On the other hand, Lix Truss was a regular visitor to the IEA (Institute of Economic Affairs) in London – this was not because the lady believed that visiting the IEA would get her more votes in her Constituency in East Anglia. Nor did vote “self-interest” calculations lead to the lady to name one of her two daughters “liberty”.
It is beliefs, not vote calculations, that matter.
We are governed very badly, because we are governed by people with very bad beliefs. This is common in the Western world.
After all, even if politicians were vote maximisers (and they are NOT) – what policies they think will maximise their votes, would depend upon their beliefs.
“If I do this, the economy will improve – and people will be more likely to vote for me”.
See how it works – the very first thing is “if I do this” – so it depends on the beliefs of the person, what they think will make the situation better.
If a country is ruled by people with terrible beliefs they will follow policies that will make the place worse and worse – even if they do not intend to make the place worse and worse.
Of course, not just belief is needed – so is strength of character.
The ability to say NO to “the markets”, i.e. a handful of institutionally corrupt corporate entities financed by Credit Money, and to say NO to officials and “experts”.
It takes someone of tempered steel to say “No” and stick to “No” in a country like Britain.
Remember Mr Johnson did not want to impose a lockdown – his courage, his moral courage, failed him. Because, it turned out, he is not man of strong moral character.
“Corruption does not matter” – yes it does matter.
If politicians are just men and women of straw – then they will always give in to the forces of this world (which are normally sickeningly evil) and the road to Hell on Earth would be certain.
Paul
To gain power in the uk, a person must first be elected an MP. In the case of my own in Hampshire, who was born and raised in Liverpool, he was selected by the local constituency and I assume supported by the Central party. Unfortunately my constituency is a safe Conservative seat. Becoming our mp was a matter of patronage. He has climbed higher to being a minister. Once again this is decided by matters of patronage.
One of the aspects of political parties is who controls them. Much of the time this is a hidden cabal I’d assume if that doesn’t make me a paranoid conspiracy theorist. Our political class were unanimously in favour of eu membership. You can ponder how that came to pass.
In my opinion, electoral pressure was the main reason why the Conservative Party finally caved and offered a referendum. Self interest. In my opinion, Boris saw the benefit of offering an end to the situation of paralysis in Parliament that might very well have ended with violence. Boris believes in Boris.
Our very system of democracy depends on self interest just the same as capitalism.