tax
Gardiner: Umunna Split from Labour Because Knew He Couldn’t Be Leader
Yesterday’s I also carried another interesting piece on page 9 by Adam Forrest, which reported claims that Chuka Umunna split off from Labour for no better reason than frustrated personal ambition. The piece ran
The shadow International Trade Secretary, Barry Gardiner, has claimed that Chuka Umunna only helped to form The Independent Group because “he knew he could never be the leader of the Labour Party”.
Mr Gardiner accused Mr Umunna of being motivated by frustrated personal ambitions. “It was fairly clear to me that the reason he wanted to leave the Labour Party was he knew hye could never by the leader of the Labour Party,” he told Sky News.
Mr Gardiner also cast doubt on anti-Semitic abuse as a primary motivation for leaving the party. Several of the nine Labour MPs who quit last week cited the party’s failure to tackle the abuse as a reason for leaving.
Mr Gardiner said he was “deeply saddened” that one of the MPs, Luciana Berger, felt she had to leave over the harassment she suffered in her Liverpool Wavertree constituency.
“I have no time for the others at all, because actually their reasons are varied by different,” he said. “What I’m clear about is that I don’t believe that [anti-Semitism] is the sole focus of why they’ve left the Labour party.”
No, I don’t believe that they left solely because of anti-Semitism either. It’s more likely because, like Umunna, all of them are Blairite mediocrities. Umunna was asked by Sky News to name a Labour policy he disagreed with. He couldn’t. Or, as has been remarked, he daren’t because they’re all popular. As for Leslie, as I’ve said, in his interview with New Scientist he was against a 50 per cent tax rate, renationalisation of the utilities, and ending tuition fees. Angela Smith’s also for keeping the water industry private. And all of them don’t want to hold an inquiry into the Iraq invasion. And they were all, or nearly all, the subject of ‘no confidence’ votes or threatened with deselection. They were jumping before they were pushed. Six of the original eight were also members of Labour Friends of Israel. And by anti-Semitism, they almost certainly anti-Zionism, or simply criticism of Israel. They’re thus standard Blairite neoliberals and warmongers.
And I don’t doubt, that as Blairites, they’re getting money from Israel. Joan Ryan was caught by the undercover journo for al-Jazeera’s documentary, The Lobby, saying that she met Shai Masot, the disgraced official at the Israeli embassy, most days for discussions. And Blair himself was financed by the Israelis and the Israel lobby through Lord Levy, whom he met at a gathering at the Israeli embassy.
These are almost certainly the real reasons they left: an attempt to preserve Thatcherite capitalism, western, corporate driven imperialism, and the preservation of Israel from justifiable criticism. Everything else is simply lies and propaganda.
Aaron Bastani on the ‘Independents’ as the Old, Blairite Austerity Politics
In this 20 minute long video from Novara Media, presenter Aaron Bastani utterly demolishes the new ‘Independent’ grouping of MPs. He shows that rather than being any kind of new politics, they are simply the old, Blairite and Tory politics neoliberal politics. They are radically out of tune with what people really want, especially millennials, who have left much worse off than the preceding generation by the same politics the Blairites and Tories were pushing. And they’re being promoted by the media because they represent the old style of politics the media like: austerity with a smiley face.
Labour MPs All Going Before They’re Pushed
Bastani begins the video by describing how the departure of the seven Labour MPs – Gavin Shuker, Chris Leslie, Chuka Umunna, Ann Coffee, Luciana Berger, Mike Gapes, Angela Smith, who left to form the Independents – wasn’t actually a surprise. They were all loud critics of Corbyn, and almost all of them had been subject to motions of ‘no confidence’ or were facing deselection. They were then joined the next day by Joan Ryan, another critic of Corbyn, who had also lost a ‘no confidence’ motion. They were then joined the day after that by Anna Soubry, Heidi Allen and Sarah Wollaston from the Tories, who complained about the old, ‘broken’ politics of Labour versus Tories.
Independents Not Democratic, and Not a Political Party
The Independents, however, aren’t a political party as such. Which means that they don’t get the Short Money given to opposition parties. This could add up to hundreds of thousands of pounds. They also don’t have to conform to the same standards as proper political parties, although they claim that they will try to do so as best they can. They also don’t have a membership. You can give them your name and contact details, and make a donation, but there is no mechanism for creating a mass organisation where the membership can determine policy. It’s a private organisation more than a political party. But what concerns Bastani the most is that they don’t want to hold bye-elections, because this would ‘crush democracy’. It’s doublespeak, and the truth is that they don’t want bye-elections because they’d lose.
Angela Smith’s Racism
He then goes on to describe how the seven founding ex-Labour members claim that they were driven out of the party by its racism, only for Angela Smith to say within hours the most racist thing he’s ever heard a politician say on television. To show how badly their launch went, Bastani produces some viewing figures. On the Monday the video of their launch had 75,000 views on Twitter. The video of Angela Smith’s apology got 700,000 views. But the video of Smith making her racist comments got even more – 1.5 million views. And while the Mirror and the Guardian wanted to splash on a video by Tom Watson, which got 500 shares on Facebook, Novara’s video of their own Ash Sarkar showing the corruption at the heart of the group – she challenged smith on her chairmanship of a parliamentary group supporting water privatisation, funded largely by the water companies – got 200,000 views. Chris Leslie then appeared later on the Beeb to sort this out. Where once again he talked about their love of democracy. A love so strong, that they don’t want to hold bye-elections, thus disenfranchising the hundreds of thousands of people, who voted for these 11 MPs. They claimed to be anti-racist, but set a new record by being racist ‘pretty much by lunchtime’.
People More Politically Engaged, Not Less
But their fundamental principle is that people don’t want Labour or Tory, but what Labour used to be 15 years ago. But at the 2017 election, 82 per cent of the population voted for either of the two main parties – Tories or Labour. That was the highest percentage the parties had since 1979. In 2010 only 65 per cent of the public voted Labour or Tory. The idea that people are turning away from the two main parties when there is a clear choice, socialism or neoliberalism, isn’t true. And the claim that people are disengaged from politics doesn’t stand up either. Voter turn-out was higher in the 2017 election, just as it was higher during the Scottish reference in 2014, and the Brexit referendum in 2016. Which was the biggest democratic exercise in British history. More people voted in that than in any previous general election or referendum. And Labour now has more than 500,000 members – more than it has had in a generation. The same is true for the SNP. More people are members of political parties now than at any point in Bastani’s lifetime. And if people genuinely do want centrist politics, how is it that the Lib Dems, who got only 8 per cent of the vote in 2015, got even less in 2017? This was despite the ‘media Einsteins’ telling us all that they would do well against the two main parties in a Brexit election. It’s almost as if, says Bastani, that the media don’t know what they’re talking about when they claim to know what the public wants.
Labour Policies Massively Popular
And then there are the policy issues. Labour’s policies are very popular. They’re right at the top of the list of why people voted Labour. But they don’t want to imitate these popular policies. Chris Leslie in an interview with New Scientist said he didn’t want a top tax rate of 50 per cent. That’s not a Corbynite policy, it’s one of Gordon Brown’s. He was also against stopping tuition fees and rejects the renationalisation of the railways, both extremely popular policies. These aren’t just popular with Labour voters, but also with Tories and Lib Dems. And polls conducted by IPPR And Sky News did polls at the end of last year which showed clear majorities of the British public wanting the Bank of England to keep house prices down and a minimal presence, at least, of workers on company boards. People don’t want centrist policies. They’re moving left, as shown on poll after poll.
Millennials Left-Wing because of Neoliberalism
And there’s a clear generational difference. At the last Labour split in 1981 when the SDP was formed, there was a clear movement to the right and post-war socialist policies had become unpopular. And yet when this split happened, the Economist carried an article decrying the popularity of socialism amongst millennials both in America and Britain. This meant ‘Generation Z’ young people, who want the government to address climate change as a fundamental part of 21st century politics. And these millennials despised the Tories, as shown by footage of an anti-Tory march. These are going to be the voters of the 2020s. And they’re not going to be bought off. They’re not left-wing because of something the read in a book, or because they want to be countercultural. They’re left-wing because their living standards and expectations are lower than their parents, they have a less expansive welfare state, they’re going to have higher levels of debt and earn less, and they will have to deal with systemic crises like demographic aging and climate change. They rightly feel that they’re screwed over. And the idea that these same people are going to agree with Chris Leslie’s idea of politics is probably the stupidest thing you’ll hear this year. And this is only February.
The Failure of Centrist Parties in France, America, Italy, Spain and Canada
But since 2015 centrist politicians have been hammered in election like Hillary Clinton in 2016. Emmanuel Macron in France was hailed as the saviour of French centrism, despite only taking 24 per cent of the vote in the first round. Now he’s the most unpopular president in French history after months of protests by the gilets jaunes, which have been met with tear gas attacks by the gendarmes, which have left people losing their eyes and their lives. Then there’s Matteo Renzi of the Partito Democratico, the Democratic Party, the Italian sister party to Britain’s Labour. In 2014 they took 42 per cent of the vote. But he was out within two years, having lost a referendum by 20 points. And in the last election the party lost half of their senators, leaving Italy governed by the Five Star Movement and the far-right Liga. Then there’s the example of the PSOE’s Pedro Sanchez. The PSOE is the Spanish equivalent of the Labour party. He’s also suffered mass protests and this week Spain called new general elections, which his party are certain to lose. Centrism is not popular in Europe or America, so the Independents have to turn to Canada’s Justin Trudeau. But Trudeau is now less popular in his country than Donald Trump in the US. Not that the media pushing ‘centrism’ will tell you this.
The Centrist Real Policy: More Austerity
The unpopularity of centrist politics is due to the fact that they still haven’t solved the problems of global capitalism created by the 2008 crash. They believed that financialisation would create the economic growth that would support public services. But financialisation hasn’t created growth since 2008. And as they can’t create prosperity and tackle income inequality, all they’ve have to give us is austerity ‘with a nice smiley face’.
Labour Splitters against Iraq Inquiry, For Welfare Cuts
And not only do the eight former Labour MPs have Brexit in common, they also voted against an independent inquiry into Iraq. A million people have been affected by the war, along with those, who suffered under ISIS, and Iranian influence has expanded across the Middle East. The idea that Iraq is irrelevant is not only absurd, it is a disgrace. People have died, and it has made an already volatile region even more so. And Britain is directly responsible. The former Labour MPs also abstained on the vote of welfare reform before Corbyn came to power. They do not stand for a moral foreign policy, or for a more just social system at home.
Their politics are a mixture of careerism and opportunism, and their opposition to Brexit actually makes a new deal more likely. They are driven by fundamental democratic principles, but won’t stand for a bye-election. No members, no policies, no party democracy, no vision. Bastani states that this isn’t the future of politics, it’s the past, and the worst aspects at that. He looks forward to sensible people joining them, because they’re going to be found out sooner or later. And if we want to establish the primacy of socialist ideas, he says, then bring it on.
The global fight for genuinely universal healthcare is a fight we can’t afford to lose
GIMMS would like to welcome Jessica Ormerod and Deborah Harrington as its guest bloggers this week for the MMT Lens. Jessica and Deborah, who were recently appointed to the GIMMS advisory board, are directors of the NGO Public Matters which is a research and education partnership focusing on public services and, specifically, the UK’s public health service, the NHS.
Photo by rawpixel on Unsplash
“We should highly value public services because this is created by people for all people. Public services ensure that no-one is left behind to suffer and that everyone has equal access to the services they need”
Jennifer Yu
The Importance of Public Services to keep our society strong and healthy
You can’t have a debate about the NHS without someone saying ‘how are you going to pay for it’. Talk about increasing funding for the NHS and someone will always ask the question ‘how much more tax are YOU willing to pay?’ On the other hand, talk about going to war and there is silence on the topic. Either tax does or doesn’t pay for things and there seems to be a clear contradiction in the public grasp of the mechanism by which governments actually spend. Understanding the basics of modern money clearly defines the real relationship between the different sectors of the economy, the availability of resources and how many of those resources a government chooses to divert to its own purpose. It clarifies that such political decision-making is never about taxing to spend or cutting spending to ‘balance the books.’
From the perspective of the benefits which public services like the NHS provide and how resources fit into that paradigm, it can best be explained in the following way. If the government wishes to build a new hospital but the country is short of the professional and skilled tradespeople to design and build it, or the materials to provision it, or the clinical and associated staff to run it on completion then, no matter how much it is needed, spending money will not create that hospital.
If, on the other hand, there is an existing, staffed hospital serving real existing needs in its community then the government can fund it as long as those resources continue to be available and are needed. To close such a hospital on the grounds of ‘lack of money’ is as false an assertion as to say ‘we’ll have to stop February at the 10th because we’ve run out of dates in the calendar.’
Although Public Matters focuses on the UK’s healthcare system, it is highly conscious of this process being a part of a global move towards privatisation, driven by an economic and political orthodoxy. However, this is not just a UK phenomenon. Across Europe the same orthodoxy is driving the same damaging reform and its citizens are suffering the loss not only of the services which form the foundations of a healthy economy but also the ethos that underpins those services.
The world needs an antidote to the neoliberal orthodoxy which has a firm grip on the way our politicians make their economic decisions. In the same way that Keynesian economics was the antidote to the chaos of the post gold standard years, modern monetary realities in the form of MMT (Modern Monetary Theory) is the same antidote to the challenges we are currently facing. Not just in relation to the decimation of public services and the erasure of the public service ethic but also solving the pressing and urgent issue of climate change and planetary survival.
To put this into a fundamental principle, all money creation, whether by government decree or bank license, is ultimately backed by government, not by the private sector. Regardless of who is in government this radically transforms any understanding of the relationship between the government and the non-government sector compared to the existing neo-liberal polity which places government as a supplicant at the feet of the City. That matters and it is political.
Criticism of MMT frequently comes from those who are defending the economic status quo (defending balanced budgets as an objective in its own right etc) whilst maintaining that they support strong social policies. The reason that we had strong social policies post WW11 was because there was a consensus around Keynes. Privatisation became the order of the day because Keynes was discredited and Friedman took his place in the economic ascendency, the ground having been assiduously prepared in advance by the Mont Pelerin Society.
If we are to reject austerity then this orthodoxy must be swept away. Some believe that rehabilitating Keynes will do the trick, but Keynesian economics is tied to the social, institutional and political conditions that existed pre-1971. That world has long disappeared, and we face new challenges. We need an economic narrative fit for public purpose and for the realities of modern sovereign economies.
GIMMS are pleased to announce that Bill Mitchell will be in London on 1st March to launch “Macroeconomics”, the textbook book he has written with L Randall Wray and Martin Watts. There is limited space at the venue so registration is essential for anyone who wishes to attend. Tickets are free and available here.
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The post The global fight for genuinely universal healthcare is a fight we can’t afford to lose appeared first on The Gower Initiative for Modern Money Studies.
Christopher Chope Blocks Bill to Outlaw FGM
What can decent people do about Christopher Chope, the Tory MP for Christchurch? Apart from either waiting for him to be voted out at the next general election, or having him committed to Broadmoor as a dangerous lunatic whose twisted view of democracy is a threat to the safety of vulnerable women and girls?
Yesterday Mike put up a piece reporting that Chope talked out a bill on Friday intended to safeguard girls and women against Female Genital Mutilation. His decision to do so was in direct opposition to his government’s own stance against this repulsive practice. Mike’s article quotes a tweet from Tweezer herself, who said
Female genital mutilation is an abhorrent practice and we will not accept it. We’ve strengthened the law on FGM, leading to the first UK conviction last week, and we’re helping communities around the world to end this appalling crime.#EndFGM
Chope declared that the reason he did so wasn’t because he was in favour of FGM, but because he hated Private Members’ Bills. But in the instance, as Mike pointed out, his professed principles amounted to pure egotism as he placed them before the wishes of his government, party, nation and parliament. Mike asked in his article whether Chope would have been quite so keen to block the bill if he knew someone, who had suffered from FGM, or if it was a form of mutilation and torture he might also have suffered if he had been born into a culture that practiced such barbarity.
Mike also goes on to say that he first learned about it at school, and it turned his stomach. I was about the same age when I first heard about it, and Mike’s right – it’s horrific and revolting. I think it can very in terms of severity, and has been described by feminists as ‘female castration’. There are absolutely no medical benefits to it, and, apart from the horrific nature of the operation itself, it can also be a positive danger to women’s health. It isn’t just the national government that is worried about it. Local authorities are too. A few years ago there was an article on the local news for the West Country on the Beeb, Points West, about concerns by activists and medical professionals about girls in Bristol being taken out of the country to their families homelands to have it done.
As for Chope himself, last year he also talked out a Private Members Bill to prevent upskirting, which Mike suggests means that he seems to have an unpleasant attitude to stop women protecting their private parts. And public opinion was very definitely against Chope. Mike quotes two Tweets from Dangerous Hero Rachel Swindon, who said
Following on from his upskirting disgrace, Tory MP Christopher Chope MP has just shouted to object to the Female Genital Mutilation Bill.
There is seriously something wrong with this guy. Abhorrent individual.
And also pointed out that he was one who believes in denying government aid to the many, while being very glad to avail himself of it.
Tory Christopher Chope doesn’t just derail upskirting & FGM bills. He voted –
•12 X for the Bedroom Tax
•44 X to cut benefits
•9 X against bankers bonus tax
•19 X to reduce Corporation tax
He used £10,000 expenses to fix his roof, a £2,600 bathroom & £881 to repair a sofa
Mike stated that, thank to his principles, the provisions of this bill will now have to be included in a formal government bill. Which means more time putting more women and girls at risk. He asks
Will Mr Chope accept responsibility for their pain and humiliation? If not, perhaps any such victims should take out a private prosecution against him.
Mike also concludes
So perhaps we should simply accept that he blocked the Bill against FGM because this principled man believes in the principle behind FGM: That those with power are entitled to do anything they like with those who have none – and do all we can to remove this dinosaur, and his prehensile principles, from Parliament at the earliest opportunity.
Chopes’ decision to block the bill seems to be part of the same attitude of a certain group of far-right Tories and Kippers. There was a scandal a few years ago, I seem to recall, when some UKIP MEPs tried to block or voted against a similar bill intended to protect women from either sexual assault or FGM, I’m afraid I’ve forgotten which. And in some cases their actions have been extremely hypocritical.
I don’t know what Chope’s attitude towards Islam is. I’m not aware that he’s a bigot. But there is a very strong element of pernicious, systemic islamophobia in the Tory party. And one of the issues islamophobes have seized upon to try to show that Islam is incompatible with British culture and should be heavily legislated against and discouraged is Female Genital Mutilation. Yes, it goes on in Islam, but it is not commanded in Qu’ran. I think it’s one of the practices that entered Islam from outside, and is most widespread outside the Middle East in sub-Saharan Africa. Certainly the women’s rights activists, who spoke about it on the Points West piece cited cases were girls were being taken there. There is an Islamic feminist movement, and I’m absolutely sure that there are campaigners against it in the Dar al-Islam. But many of the same Kipper MEPs, who voted against the European parliament’s attempts to outlaw it were also bitterly islamophobic, which made them both religiously bigoted and misogynist. Islamophobe or not, by blocking this legislation Chope has also undermined the efforts of Islamic and BAME feminists to protect women. But then, as Dangerous Hero Rachel Swindon and Mike have pointed out, Chope doesn’t believe in supporting the health and welfare of the poor and underprivileged, only in giving even more to extremely rich White men like himself.
As for his precious principles, they’re clearly undemocratic. Private Members’ Bills always have been part of parliamentary democracy. He can hate them all he likes in principle, but it should not be his right to obstruct parliamentary democracy. Especially when it puts women and girls at risk of horrific mutilation.
You hope it won’t be too long before there’s a general election and he, and the rest of his party of thugs and bigots, are thrown out and a proper Labour government installed instead.
Private Eye on the Real Reason James Dyson Is Moving His Business to Singapore
A week or so ago I put up a number of posts reporting and commenting on the outrage James Dyson caused when he announced that he was moving his company’s HQ to Singapore.
Dyson has been given a great deal of support from this country, and in the West Country he was regarded, or at least presented by the local media as a local hero. But he’s done this before. A few years ago he demanded that Bath give him more land to expand his business. They refused, so he decided instead to expand in the Far East. He needn’t have done so. If there was no room at Bath, he could have happily gone to other south-western towns. He already has plants in Malmesbury and Bristol, for example. Or gone further afield, like Wales or the north, which would also have been glad to have him. But he didn’t.
It was especially hypocritical as Dyson was telling everyone within earshot a few years ago that we should have joined the Euro. Then he decided he was backing Brexit. Now it appears that he has gone to Singapore partly because they’ve signed a trade agreement with the EU, which would make it easier for him to export his goods to them from there rather than Blighty.
Private Eye has run two pieces on Dyson in this fortnight’s edition for 8th-21st February 2019. And they make it very clearly that he’s going for the same reasons every exploitative multinational is heading abroad due to neoliberalism: to take advantages of countries with low tax rates, where workers can be hired and fired almost at will. The first article, ‘Bye-Bye Suckers!’ on page 7, runs
So Sir James Dyson’s relentless bullishness about post-Brexit Britain was so much hot air. The man who will now move his HQ to Singapore evidently has little real faith that Brexit will unleash the potential he has long claimed.
Th benefits of Singapore are likely to go beyond the proximity to his Asian empire that Dyson claims. By moving east it will also be easier to reduce workers’ rights. As Dyson told the BBC’s Andrew Marr last year: “This is controversial, but since I don’t know what orders I’m going to get next month or next year, industry, manufacturing industry’s very volatile. Not being able to flex your workforce is another big reason why you wouldn’t start a manufacturing business or expand a manufacturing business.” Elsewhere, he agreed bluntly, it was easier to hire and fire.”
This is not the most generous response to what the UK has given Dyson. Since 2012 his group has sucked up around 100m pounds in tax credits, ie discounts on its corporation tax bill. IN 2011 the then chancellor George Osborne brought in a special tax break for buyers of “energy efficient hand-dryers”, which meant…Dyson airlades.
There’s more information in the Eye’s ‘In the City’ column, entitled ‘Singapore fling’ on page 41. This runs
What is it that so attracts billionaire inventor, entrepreneur and avid Brexiteer Sir James Dyson to Singapore? Last month he announced that his privately owned Dyson group was switching legal residence to the Far East city state for “commercial reasons” and “future-proofing”. This followed the decision to produce the Dyson electric car in Singapore from 2020.
The Dyson party line is that the imminent move is nothing to do with Brexit or tax – it will still pay UK tax on UK operations – but all to do with Singapore being a lot closer to China, its main market, than Wiltshire. Who knew? Dyson’s 2bn pound move from hairdryers and bagless vacuum cleaners into cars is his biggest gamble.
So what does Singapore have over a “no deal” Brexit Britain – which Dyson welcomed? What about:
* A recent free trade agreement with the EU, to go with ones with China and the United States, plus the Singapore Freeport;
* International companies who headquarter themselves in Singapore can see corporation tax (currently 17 per cent, compared with 19 per cent in the UK) fall to 10 or 5 per cent or even zero, thanks to lengthy tax breaks and generous incentives, especially for those who create jobs;
* No tax on dividends – the Dyson family could have paid 38 per cent on the 86m pound dividends for 2017 (down from 111m) from the parent Weybourne Group;
* No capital gains tax on a future sale or inheritance tax (IHT) (Dyson is 71);
* Less stringent corporate disclosure and governance requirements for private companies (a Dyson moan);
* Finally, no risk from a Corbyn government targeting the rich.
Dyson moved control offshore once before – to Malta in 2009 – then returned in 2013. He has also legitimately taken advantage of film tax schemes and IHT-efficient investments in agricultural land. Still, Singapore tax and access attractions clearly played no role in the move east by this latter-day Stanford Raffles, who assured Leave voters that no deal with the EU was no problem because “they’ll come to us”. Now it seems Dyson has decided to go to them.
Yay! My Books Have Arrived Ready to Send to Reviewers
Yesterday and today I got the packages of multiple copies of the books I’ve published with Lulu, which I ordered last week. The first package, which I got yesterday, was of copies of my political books Privatisation: Killing the NHS, For A Worker’s Chamber and Crimes of Empire.
Privatisation: Killing the NHS is all about the Thatcherite plan to sell off this greatest of British institutions from Thatcher herself through Major, Blair, Cameron and now Tweezer.
For a Worker’s Chamber argues that as parliament is now dominated by millionaires, there should be a chamber solely reserved for working people, elected by working people.
And Crimes of Empire surveys current foreign policy and tries to show that instead of defending democracy in eastern Europe and bringing it to the Middle East through the War on terror, and so on, British and American foreign policy is and always has been about protecting western commercial interests. Which has always meant toppling foreign governments, installing brutal dictators and looting their countries of their resources and industries. Like the way the Americans overthrew the democratic socialist government of Jacobo Arbenz in Guatemala in the 1950s, because he nationalized the plantations of the United Fruit Company. Britain and America overthrew the premier of Iran, Mossadeq, at the same time because he dared to nationalize the Iranian oil industry, which was firmly in our hands. And the invasion of Iraq nearly two decades ago was all about seizing the country’s oil industry, privatizing their state industries so that they were sold to western multinationals, and then trying to turn the country in the low tax, free trade state the Neocons love. Which wrecked their economy. And more, ad nauseam.
The second package, which I got today, was of copies of my two volume book on slavery in the British Empire, The Global Campaign.
I’d like to get my books out to a wider audience, and so I’ve ordered multiple copies of them to send to various magazines and journals in the hope they’ll review them. I really don’t know if they will. I suspect that they may will be ignored in favour of books from known publishers and authors. But if you don’t try, you don’t know. I’ll let you know how I get on.
All the above books can be ordered from Lulu. Or from me, if you want a signed copy, though that will mean extra postage, as I’ll have to order from Lulu to go to me, then post it to you.
Why fixing poverty and inequality does not depend on a benevolent global wealthy elite
Photo by Steve Knutson on Unsplash
“Any man can make mistakes, but only an idiot persists in his error,” said the Roman philosopher Cicero. Now that we know how inequality harms the health of societies, individuals, and economies, reducing it should be our top priority. Anyone advocating policies that increase inequality and threaten the wellbeing of our societies is taking us for fools.
Kate Pickett and Richard Wilkinson
Why Inequality is bad for your health
Oh, the irony! Two worlds collide. Davos and the World Economic Forum versus the planet and its citizens. As David Attenborough hosts a series of talks on the dangers of man-made climate change and Oxfam shines a light on growing global wealth inequality, an estimated 1500 individual private jets fly into the Davos summit which is gridlocked all week with limos while the global elite sport their freebie ‘I’ve been to Davos’ blue bobble hats and quaff champagne. It contrasts starkly with the world outside the bubble. A world where climate change is making its presence felt in extraordinary climate and weather events from drought and crop failures to storms, floods and rising sea levels, extreme temperatures and forest fires and the threat of ocean warming. A world where the damaging effects of a deliberately manufactured and growing gap between the world’s poorest and richest is made worse by climate change threatening to drive hundreds of millions of people into more poverty or into refugee status. It is a stark and unsupportable future we face without direct and urgent action now.
The corporations, politicians and rich elite in Davos pay lip service to it, whilst divvying up the resource spoils ever more unfairly at huge expense, not in financial terms but in costs to the health of citizens and the survival of the planet. The global elites have it well and truly all sewn up in their own favour, it would seem.
Last October in one of its first blogs GIMMS reported on the IPPC’s (Intergovernmental Panel on Climate Change) comprehensive report on the state of the climate which warned that we only have 12 years left to halt the worst effects of climate change. Regrettably, those warnings may not even reflect the true seriousness of the challenges we face as the clock ticks on and our leaders behave as if time were not of the essence. As the new leader of Brazil, Jair Bolsonaro, commented at the collapse of a dam which killed many workers a few days ago and which seems to reflect a common position ‘Environmental protection shouldn’t interfere with growth’. An ostrich with its head in the sand approach is being taken by our leaders, and not just the worst tyrants, at a time when the capacity of our natural world to support life is threatened.
And whilst the planet starts to behave like a fortress under siege, people are bearing the brunt of government choices led by orthodox economic ideologies which suggest that the rich are the wealth creators, that the state has only a minimal role to play in the economic success of a nation and that a lack of money is stopping government acting in the public interest. The shift of surplus value from labour to capital has left wages stagnant and working people ever more exploited and the foundations of civil society under threat.
Oxfam estimated in its 2019 annual report, released just before the Davos forum got underway, that 26 of the richest people in the world owned as much wealth as the bottom half of the world’s population put together. In 2018 it noted that 42 people held as much wealth as the poorest half of the world’s population and that 82% of global wealth generated in 2017 had gone to the wealthy 1%.
In 2018 it called on world leaders to tackle tax evasion and boost the pay of workers. This year it suggested that “a wealth tax on the 1% would raise an estimated $418bn (£325bn) a year enough to educate every child not in school and provide healthcare that would prevent 3 million deaths”.
Nobody can deny the well-meaning intent. Equity is of paramount importance. But it is regrettable that Oxfam and other well-intentioned commentators from politicians to journalists and economic institutions focus on collecting tax to remedy not just this injustice but also to deal with the threat posed by climate change to the planet’s survival. If they did but know it, they are limiting the very action government could take to remedy these very serious issues.
Of course, most people believe that a government must collect tax (of whatever kind including National Insurance), or borrow, to cover government spending; how government provides public services, the NHS, the education system or pays for the social welfare which covers our pensions, unemployment and disability benefits. It’s a natural assumption which is understandable. However, a tax on the rich, which no-one should doubt is needed for reasons of equity and to redistribute wealth and resources more fairly, will not raise a bean towards the capacity of any currency issuing government to spend on education or indeed healthcare. In fact, a government which issues its own currency (in our case the £ – or it could be the dollar or the yen) has no need of the tax of the rich or anyone’s tax for that matter in order to spend. Indeed, logically, a government must spend the money into existence first before anyone can use it to pay their tax. This reveals the nonsense of the tax and spend narrative.
The story we’re constantly told is that we should ask the rich to pay for services to the poor in a Robin Hood kind of way; a sort of charitable donation or obligation on the rich to make a generous contribution to society. The implication is that without such contributions the state could not provide the public infrastructure on which we all depend. Society, however, is not dependent on the rich man’s benevolence. It depends instead on a government acting to protect the interests of all its citizens through reducing income inequality which has very destructive consequences on the health and well-being of people.
Of course, there will always be those who say that objecting to excessive wealth is just the politics of envy. However, we only have to look around us, on our streets and in our communities, even in our close or extended families, to see the destructive effects of income inequality. It is important to counter the arguments that the blame lies with individual irresponsibility. Excessive wealth has given a few people undue control, which enables them to buy influence in the corridors of political power. It enables them to appropriate an unfair share of the world’s natural resources and exploit those who labour to create the real wealth which sustains us.
The bottom line is that all governments make choices about their spending priorities which have nothing at all to do with the state of the country’s finances or whether it has collected enough tax to fund public services. They make their choices based on their ideologically driven political agendas. Neoliberal governments across the world have chosen to inflict damaging fiscal austerity on their citizens, which has driven the rising poverty and inequality which charities aim to address.
Yes, let’s tax the rich for equity, and to allow a fairer distribution of our wealth in terms of real resources, but it’s time for charities such as Oxfam to recognise that their taxing the rich to spend narrative does not represent the options open to any sovereign currency issuing government when making policies to deal with the challenges we face. This is a political issue driven by ideology and it’s time for those with public voices to get up and say so.
It really is time for change.
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The post Why fixing poverty and inequality does not depend on a benevolent global wealthy elite appeared first on The Gower Initiative for Modern Money Studies.
The Myths and Legends of Hypothecated National Insurance
Over the last few days there has been a story whizzing around social media that our National Insurance contributions are being used to pay off the national debt. The Fund, as revealed by John Prescott in 2015, supposedly contained £30billion of spare money which at the time it was said could be used to save the NHS. Now it is being claimed, falsely, that the surplus fund is being used to pay down the national debt.
There is a fundamental public misunderstanding about how governments spend, the role of taxation (and after all National Insurance is just another tax) and even what the national debt is. The myth about government needing to tax or borrow in order to spend persists in the public mind. However, a government which issues its own currency, neither needs to tax nor to borrow in order to spend and shock, horror that big bad national debt burden is nothing but our savings and no threat at all for today or future generations.
In this excellent blog, originally published here, Public Matters tells the real story about NI from its history to the present day. With a better understanding of how National Insurance works, the questions about how public programmes will be paid for can move from it being dependent on prevailing financial conditions to a question of political choices and ideology.
There are pressing reasons for understanding a bit about how our tax system works and very specifically what National Insurance is. NI is used as successive governments’ tax increase of choice because of a widespread and mistaken belief that it is a direct payment to the NHS. The Liberal Democrats had it in their 2017 manifesto, Gordon Brown put 1p on NI to ‘pay for’ the NHS, Frank Field (Labour) gave evidence on NI to the Lords Committee on the long-term sustainability of the NHS and his website says he is working on this issue with Oliver Letwin (Conservative) and he wants to restore a ‘something for something’ society.
Frank Field’s website says: ‘Polling last year found that while 42 per cent of the public would support an increase in tax to pay for a larger National Health Service budget, this figure climbs 11 points, to 53 per cent, once the public are asked about an increase in NI contributions.’
One of the most recent additions to this proposition was in an ‘exclusive’ from the Daily Telegraph (18 March 2018 paywalled): “It is understood there is now broad agreement within the Cabinet that extra money must be provided for the health service. Some ministers have privately suggested an across-the-board rise in National Insurance to provide new ring-fenced funding for the NHS. However, The Telegraph understands that officials are drawing up plans for a more targeted tax rise on older workers as part of a new 10-year funding plan for the NHS championed by Jeremy Hunt, the Health Secretary. One idea under discussion is to make the 1.2 million pensioners who keep working past 65 to pay NI contributions. The move would raise £2 billion per year which could be spent on the health service. Scrapping universal free prescriptions for the over-60s is also under discussion.”
The Telegraph article incorporates many of the issues frequently raised when talking about how to pay for the NHS. These arguments have muddied the waters about how public funding is allocated giving rise to political decisions being made on the spurious grounds of ‘affordability’, ‘sustainability’ and ‘no money’. And it has led to campaigns and petitions calling for 1p in the £ tax or the hypothecation of NI to ‘pay for the NHS’.
Here we make the argument that this is not only misleading but it will undermine rather than support the NHS.
A political consensus – can we afford the NHS if the public won’t pay more?
Earlier this year, thousands of NHS campaigners marched and rallied across the country in protest at the de-funding, cuts and privatisation of the NHS. Anyone who isn’t an NHS campaigner could have been forgiven for missing it, it was given so little press attention.
In contrast, two days later the BBC gave headline space on its flagship news programme, Radio 4’s Today, and on BBC One’s Breakfast, to the Liberal Democrats’ perennial call for NI to be increased for the NHS. They are also calling for NI to be converted into National Health and Social Care Insurance – which they refer to as a hypothecated tax.
Simon Stevens has argued for different funding sources too:
“Would intergenerational fairness support a further increase in the share of public spending on retirees, at the expense of children and working-age people? Should it be easier for families to flexibly fund social care by drawing down resources tied up in housing, pension pots and other benefits?”
A little bit of history (but not too much)
Funding was a key issue in all the prototype versions of the health service that finally became the NHS. The debate about how to pay for the NHS was based around three elements, all of which are reflected to greater or lesser degrees in other healthcare systems around the world today.
These were (and are):
1. The Exchequer should pay a proportion via government run national insurance.
2. Local authorities should pay a proportion from the rates (council tax).
3. People should make a contribution from their own pockets -usually as some form of insurance.
Combinations of these are used across the world in a system known as the Bismarck Model.
NI already existed for working people in the UK before the creation of the Welfare State. It gave an entitlement to unemployment benefit, seeing a doctor and some pension benefits. But Prime Minister Clement Attlee supported Aneurin Bevan’s desire to break the connection with insurance to bring in something quite different for the NHS – and unique in a Western democracy. The NHS was to be paid for in full by the Exchequer. It has caused complaint and consternation ever since about its affordability – ‘growing and ageing populations’ have always been seen as a threat to its survival. Yet it has been consistently one of the lowest cost universal healthcare systems in existence. And that has been largely as a result of this direct funding method.
In 1952 Bevan wrote ‘In Place of Fear’ a remarkably modern set of essays showing that the questions about funding, who gets access, what should be provided are perennial and instantly recognisable across the years. He writes one of the best explanations of why NI was not chosen as the method of payment:
“When I was engaged in formulating the main principles of the British Health Service, I had to give careful study to various proposals for financing it (…) what was to be its financial relationship with national insurance; should the health service be on an insurance basis? I decided against this. It had always seemed to me that a personal contributory basis was peculiarly inappropriate to a national health service. There is, for example, the question of the qualifying period. That is to say, so many contributions for this benefit, and so many more for additional benefits, until enough contributions are eventually paid to qualify the contributor for the full range of benefits.”
So, to answer Bevan’s question, what is the NHS’ “financial relationship with National Insurance” in 2018?
Given the number of people who respond on social media to questions about funding the NHS by saying, ‘I pay for it already with my National Insurance’ – it looks as though the question is answered in popular consciousness, if not in reality.
It might surprise people to learn that the National Insurance Fund (NIF) today is used to calculate employment related and pension benefits, as it did before 1948. It doesn’t include paying to see a doctor! This Fund supposedly contains £30 billion of spare money. You may have seen the petition to parliament asking for the release of the money to save the NHS. John Prescott, former Deputy Prime Minister, was the person who discovered this ‘secret’ in 2015. But, like many things which have an eternal life on social media, it isn’t quite true.
Bevan talks about ‘the qualifying period’ for NI. NI still has qualifying periods for the various benefits it covers.
According to the government website the list below is what NI is for. Each of the benefits listed have different numbers of contribution years needed to be able to claim them. For example, it takes a minimum of 10 years contributions to earn entitlement to any state pension at all and 35 years to earn full entitlement. State pensions aren’t like private pensions. There is no personal money pot built up. Instead your contribution to society through your earnings is a social contract. There is an expectation that, having contributed through your working life, the government of the day will honour the contract when you retire.
Benefit
Class 1: employees
Class 2: self-employed
Class 3: voluntary contributions
Basic State Pension
Yes
Yes
Yes
Additional State Pension
Yes
No
No
New State Pension
Yes
Yes
Yes
Contribution-based Jobseeker’s Allowance
Yes
No
No
Contribution-based Employment and Support Allowance
Yes
Yes
No
Maternity Allowance
Yes
Yes
No
Bereavement Payment
Yes
Yes
Yes
Bereavement Allowance
Yes
Yes
Yes
Widowed Parent’s Allowance
Yes
Yes
Yes
Bereavement Support Payment
Yes
Yes
No
The NHS is conspicuous by its absence from the list above.
In the late 1970s over 65% of all unemployment benefits were based on contributions from previous employment with 35% being means tested. Today it’s almost the mirror image and contributory benefits are now just over 42% of the total.
Why do people say that National Insurance pays for the NHS?
Most people will remember Gordon Brown, when he was Chancellor of the Exchequer, saying he would put 1p on NI to ‘pay for the NHS’. There is that claim from John Prescott that he had ‘found’ £30bn in the NIF ‘for the NHS’. And the Liberal Democrats – along with Labour’s MP Frank Field – insist that NI should be changed to fund the NHS and Social Care as a hypothecated tax.
Is it any wonder that people believe that’s how the NHS is paid for, with so many politicians saying it is, or should be?
There is, in fact, a difference between the NIF and the National Insurance Contributions (NICs) collected. And the difference illustrates the confusion that exists about the tax system. At this point it is worth pointing out that, despite any statements to the contrary, NI is just a tax.
The Government Actuary’s Department has estimated that NICs will raise just over £125 billion in 2017/18, of which £101.8 billion will go into the NIF and £23.7 billion will go to the NHS.
What is accounted for in the NIF, as explained above, is the estimated amount of contributions needed to pay for the contributory benefits including pensions. Any excess over that amount is supposed to ‘go’ to the NHS, but it isn’t equivalent to the amount of funding the NHS needs. It is simply accounted for in the Consolidated Fund at the Bank of England which is a record of all the Government’s spending and receipts.
This brings us to the central issue of why politicians insist on making the link between the NIF and the NHS. At its most basic it is because politicians believe that if the public think that the tax is being spent directly on something they want and have a direct interest in (working benefits, pensions, health) they are less likely to complain when that particular tax is increased. And why do they believe it? Because countless polls tell them so. They also like going to the polls saying that they will not increase income tax – that’s a huge vote loser. But a manifesto commitment on ‘income tax’ can be neatly circumvented by increasing the other income tax – NI.
Is National Insurance a hypothecated tax?
A true hypothecated tax is one in which the tax is ring-fenced for a named service and pays for all that service. This system effectively enforces a spending cap on the service being paid for as it limits spending to an equivalent of the tax levied. That’s very difficult to do when necessary spending is required before the taxes are received. It’s also difficult to define the ‘whole’ of a service.
The NIF appears to be hypothecated. Its rules say that the Fund must always contain enough contributions to meet all its obligations as listed above. To this end it must have a reserve in hand (John Prescott’s £30bn ‘secret’). But the Treasury also makes grants available to the NIF to make sure it keeps to its rules when it doesn’t have enough contributions coming in. A further adjustment is made between the balances in the England & Wales account and the Northern Ireland account to make sure they both represent the right amounts for their relative constituencies. Yet more adjustments are made because the Department of Work and Pensions and the Department of Business, Skills & Innovation both make payments out of their own budgets for the benefits accounted for under the NI scheme so transfers are made between them to equalise the accounts.
There is also an excess of receipts required to fulfil the contributory principle over the course of the accounting year and that doesn’t go into the Fund at all. It is not a genuine hypothecated tax. It is a bookkeeping exercise.
If NI is just a tax and it isn’t hypothecated, what’s the point of it?
Historically people had a direct link between their NI contributions and the benefits that accrued to them as a result. Pensions retain that historic link, with a defined minimum and maximum number of ‘contribution years’ required. In and out of work benefits for those covered by the NI scheme also have minimum contribution periods. It is the contributory principle that makes NI difficult to abolish. Income tax is simply recorded as an annual amount, no matter what the source of the earned or unearned income. NI, on the other hand, is recorded as the number of consecutive weekly contributions. It is the appropriate number of full years in a given period that defines eligibility for the benefits.
People who take breaks from paid employment for any reason and therefore have a break in their contributions may receive a letter asking if they wish to make a voluntary payment to cover the missing contribution period. That couldn’t happen with income tax. Getting rid of NI therefore leaves a problem of how to calculate eligibility for contributions-based benefits.
NI hides the true levels of income tax
The headline rates for income tax are currently set at 20%, 40% and 45%. This looks as if we have a very fair system where the lowest earners only pay half what higher earners pay. However, if NI is added to income tax the picture looks very different.
NI (tax!) starts below the personal allowance level.
Income bracket
Income tax rate
NI rate
Total tax
£8164 – £11,500
0%
12%
12%
£11,500-33,500
20%
12%
32%
£33,500-£150,00
40%
2%
42%
£150,000 +
45%
0%
45%
People often call NI a regressive tax because it doesn’t increase with higher earnings but what is far worse is that it masks the real differentials between the rates of taxation. The lowest rate is quoted at 20% and the higher rate at 40% which leads people to reasonably believe that lower earners are not carrying the burden of tax but as the real figures are 32% and 42% respectively then it is a far less fair system.
So, when campaign groups call for a penny on income tax to fund the NHS or that there should be further increases in NI they may not be aware of how serious the impact is on lower paid workers. In 2016-17 a fraction over 31p in every £ of tax collected was income tax. NI accounted for just under 22p. The rest is accounted for by other taxes.
Inter-generational Fairness – a concept designed to persuade people that you don’t get what you don’t pay for
Over recent years there has been a change in the general understanding of what the economy actually means. Politicians talk as if the economy consists of the private sector and its wealth creation with government wholly dependent on the taxes raised from that wealth creation. Government expenditure is framed as money lost or wasted or a drain on the economy. The tax ceiling is used as a whip to limit government who must be vigilant against overspending or allowing ‘debt’ to get out of hand. It also tends to focus on income tax and NI to the exclusion of other taxes.
This is the narrative that explains why services need to be reduced or more paid for them by the public. It creates an obligation on those who cost most to be asked to contribute more for the sake of ‘fairness’ and ‘not burdening the state’. It makes means testing into a harsh system of proving you really need state help before you can get it. It reflects Frank Field’s ‘something for something’ idea that you don’t get what you don’t pay for. It is the political and moral opposite of the NHS.
Far from ensuring intergenerational fairness, this system forces the burden of payment for the NHS on to people in paid employment who are paying NI as this tax is not paid on unearned income nor by various other income groups.
The idea of expanding NI to retirees and of extending its range, making it more progressive, also ignores the contributory element. The regressive nature of NI is directly attributable to its contributory nature. Once you have paid ‘enough’ to meet the contributions threshold there is no justification for levying any more, as there is no more additional benefit to be ‘earned’.
This is the landscape that gives rise to the NHS Five Year Forward View with its voucher scheme for maternity and personal budgets for disability and now for the Liberal Democrats arguing for a National Health and Social Care Insurance for older people. Asking pensioners to pay NI when they already made their contributions to earn the status of pensioners is clearly nonsense and anything but fair, but you can change that argument if you change the purpose of the tax.
An insurance-based health and social care system
The Liberal Democrats report says:
“we .. believe that an NHS funded by national taxation continues to be the best option for delivering our healthcare system, and so we decided early in our discussions that we would not explore options for an insurance-based health system as a means of raising additional revenue.
…. thanks to great strides made in tackling pensioner poverty, after housing costs pensioner households are far less likely to be in poverty than households of working age, particularly those with children.
For this reason, we suggest policy makers consider ending the exemption from paying NICs for people who continue working past the state pension age. NICs could either be equalised with the rates paid by the rest of the workforce, or introduced at a lower rate.
(…) this is the age group who are the biggest users of health and care services and, as described in the section on income tax above, on many measures this group of workers are proportionately better off than younger generations.”
Like many of the issues we have examined in this blog these statements appear to superficially make sense regardless of whether or not you agree with them. But health and social care now form part of a single government department and the NHS and local authorities are being brought together within integrated systems with combined budgets.
Despite saying they would not explore options for an insurance-based health system, the Liberal Democrats’ focus on paying some form of insurance for health and social care actually means converting NI to a state insurance scheme. They are calling for Theresa May to back their scheme. This would transform our Bevanite state-funded NHS into a Bismarckian system. Currently healthcare is free at the point of need and social care is means-tested, which brings an element of uncertainty to what exactly is to be covered by this insurance.
If this were simply an argument about tax there are, of course, many other forms of tax. It takes experts to calculate the changes in government receipts and the effect on households when tax thresholds are raised or lowered. That is what would be being considered if this was about changing our tax structures or raising taxes in general.
But this is not an argument about tax. This is an argument over the role of the government.
While it may appeal to many to call for increased taxes to ‘fund’ the NHS what we really need is to understand how public funding works. The root of the problem does not lie in our tax system. It lies in public policy decisions.
If you are asked to sign a petition or support calls for a hypothecated NHS & Social Care NI or for 1p in the £: just say ‘no’.
For further reading:
Post crash economics and ‘Professor’ George Osborne
Jeremy Hunt calls for increase in tax to pay for Trident
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The post The Myths and Legends of Hypothecated National Insurance appeared first on The Gower Initiative for Modern Money Studies.
Hypocrite Brextremist James Dyson Abandons Britain for Singapore
Mike over at Vox Political has put up a piece reporting that James Dyson, the multimillionaire inventor of the vacuum cleaner that bears his name, has abandoned Britain for Singapore after strongly promoting Brexit. He was one of the leading industrialists in Britain supporting the ‘Leave’ campaign, and when they won, he told the rest of us that leaving the EU’s single market would liberate the UK’s economy and allow us to make other trade deals with the rest of the world. He also said that we should leave the EU without worrying about an interim deal, because ‘uncertainty is opportunity’, and that they would come to us if we just walked away.
Dyson has shown how much faith he has in the British economy now that they’re due to leave the EU and the possibility of a ‘No Deal’ Brexit is unfortunately all too strong: he’s decided to abandon his present headquarters in Malmesbury for Singapore. He hasn’t any, and Mike’s article on this has a series of tweets from people criticizing him for his decision. One of those is ‘Shop Steward’, who tweeted
“The thing is he’s a multimillionaire so he could stay here and still make a profit In fact he could stay here, improve workers pay & conditions, and still make a profit …but greed won’t allow that. No, profit must be maximised at all costs because enough is never enough.”
Quite. Another commenter, Paul Bernal, asked how many other Brexiters have to leave the UK, either personally or just their businesses, before voters realise they were being conned. Gavin Esler, who I remember was the name of one of the Beeb’s foreign journalists, reported that P&O has just re-registered its UK fleet to Cyprus before Brexit.
Deeply Unhelpful Shelly responded to this with the observation that are probably very many others, who won’t make it public because they fear being attacked by the ladies and gentlemen of the media. Mike also observes that while P&O didn’t promote Brexit, they are sending a message to other businesses that they should get out while they can.
As for Dyson, Mike says
Dyson is on record, not just as a Brexiteer but as a Brextremist, and his decision reeks of the worst kind of hypocrisy.
He supported Brexit; he influenced other people to support it; and now he is abandoning us to the consequences while he scarpers, taking his business and any benefit it has for the economy with him.
Make no mistake: This man is toxic.
He has helped inflict economic ruin on the UK, both by encouraging us into Brexit and by taking his business out of the country before it happens.
I’m not surprised that Dyson has run off to Singapore. He has previous on this. Here in the West Country, Dyson was regarded as one of the great molten gods of local business. Following the success of his vacuum cleaner, he appeared several times on the local news programme in the Bristol/ Somerset/Gloucestershire/Wiltshire are, Points West, whenever there was an item about local authority initiatives to boost business. But as I reported in a previous article, Dyson has moved his business out of Britain before. A few years ago he demanded that Bath council should allow his factory in the area more space to expand. The council told him they couldn’t. So Dyson picked up his ball like a grumpy child unable to get its way, and went elsewhere. I think he moved his business to Indonesia, or somewhere else in the Far East.
He didn’t have to do that. His business was perfectly profitable here in the UK. If there wasn’t enough space for it to expand in the area around Bath, he could have moved it elsewhere in the West Country or Britain. There would have been plenty of other places in Britain which would have been delighted to have him bringing work and jobs, particularly in the depressed areas of the North.
But Dyson didn’t take that option. He went to the Far East, where he knew he could make even bigger profits through exploiting the lower wages and poorer working conditions in the Developing World. This is the logic of neoliberalism. It’s done to allow capital to move their businesses around the world in order to reduce wages and take advantage of lower taxes in these countries. Just as Jacob Rees-Mogg has part of his money invested in Far Eastern companies through his capital management firm. And you can bet that the wretched authors of Britannia Unchained, who also believe that Brits should work longer hours for less pay in order to compete with the Developing World, are likewise also ready to run out on Britain the moment it suits them.
Dyson is a massive hypocrite, but he’s just one of many rich, Brexiteer businessmen, who promise that Brexit will bring prosperity and jobs to Britain, but realise only too well that it won’t. They’re now running off to the real low wage, low tax havens in the rest of the world, whose people they really want to exploit.
He’s toxic, and so are the rest of them. And they’re determined to wreck Britain. His attachment to Britain and the West Country was always questionable. We’ve lost nothing by his departure, but we should never have listened to him and those like him in the first place.
Lovers of exemption from tax
Welcome to Alan Hutchison, our MMT Long Read author for this week. Alan begins his blog post with a riddle, and as he notes most people will answer without hesitation. But there is another option which meets all the criteria. Read on to find out what in this creative and entertaining introduction to Modern Monetary Theory.
Originially posted on Alan’s blog, Matches in the Dark here
‘Tax Payers’, GB 1937, 1952
Notwithstanding their fundamental simplicity, it is sometimes a little difficult getting across the basic concepts embodied in Modern Monetary Theory. That it is occasionally a bit tricky indicates how misconceptions about the monetary system are deeply ingrained in the public consciousness.
Examining the ideas in an unusual context can help and that’s what I am going to try here.
It starts with a little riddle:
I am made of paper and have interesting designs printed on my surface. I am usually associated with a nation and if that nation is a monarchy it is commonplace for me to have a representation of the monarch included in my design.
I am created and issued on demand by the state (although the state may contract my creation to the private sector). It is illegal to create counterfeits of me.
I have monetary value and I am denominated in varying amounts of the national unit of account. In comparison to my denominated value, it costs the state virtually nothing to create me.
I can be used to pay for goods and services supplied by the private sector or by the state.
I can also be used to pay taxes to the state. When I am used to pay tax, or to pay for services from the state, I am cancelled.
Until I am cancelled I represent debt owed by the state.
Quite a few people desire to hoard large quantities of me and forego using me for payment. In certain circumstances the state will pay interest to the people who have collected me.
Some foreign entities like to hoard me and are happy to accept me in return for real resources.
The fact that some people like to hoard me means that the state issues more of me than gets cancelled.
Finally, my greatest fear is hyperinflation.
What am I?
Most people will answer without hesitation. Surely the answer to the puzzle is ‘currency in the form cash’, isn’t it? That is certainly a valid answer, but there is another option which meets all the criteria: postage stamps.
Eh? Can you pay for goods and services with stamps? Can you really fulfil your tax obligation with little sticky labels? Does the government pay interest on stamp collections? Do people gleefully swap real resources for tiny bits of paper which the state created at virtually no cost?
The answer to all these questions is ‘Yes’ and that’s because stamps are a form of currency.1 Let’s look at the description in detail to see why.
I am made of paper, issued by the state and cost virtually nothing to create
Printing money, Kenya 1966
Clearly, stamps fit the physical description, being made of paper and bearing printed designs which frequently feature a ruling monarch. At one time they were issued exclusively by the state (no longer so in the UK now that Royal Mail is a private company) and there are custodial sentences available for anyone making illicit copies of them. Stamps are generally denominated in the local currency — ranging in the UK from a few pence to a few pounds — and the cost to the state to print them is negligible.
The same applies to cash issued by the state and the bit about costing nothing to create is at the core of MMT. The no-cost concept applies to all new money created by the state, most of which can be brought into existence with nothing more onerous than typing a few numbers at a keyboard. And all state spending is new money, just like all stamps issued by the state are new stamps.
I have monetary value
Officials, India 1883, New Zealand 1941
Unused stamps have worth and can always be exchanged for cash at or close to their face value. Just like cash, precautions must be taken when unused stamps exist in large quantities and to prevent theft they need to be kept in a secure place and be subject to regular auditing. The problem of theft is particularly troublesome in countries with large bureaucracies and extreme income inequality — countries of the British Empire, for example.
In India under colonial rule, a lowly railway clerk may have been tempted to pocket a few postage stamps which had been issued for government use and sell them on in the private sector. To get around the problem the colonial administration issued special ‘Officials’, stamps overprinted with ‘On Her Majesty’s Service’ or something similar. They were supplied exclusively to civil service departments and would have no value in the private sector. Officials were issued by administrations across the Empire and Dominions.
Looked at from an MMT perspective, the processes which follow on from the issue of Official stamps are interesting. The stamps cost almost nothing to produce and could, in theory, be issued in any quantity desired by a particular civil service department. When the stamps are used on letters and parcels they cause work to be done in another part of government — the postal service. Officials effect a transfer of resources from one government department to another.
In the same way, when the government spends money (which costs nothing to create) it causes resources to be transferred from the private sector into the public sector. Provided we have elected a suitably enlightened government, those resources will be used to further the public purpose.
I can be used to pay for goods and services
Postal Order, Ireland 19222
That stamps are used to pay for a service is not contentious. It’s something you do every time you put a stamp on a letter and drop it into a post box. If the state owns the postal service then you are paying the state for the service; if the postal service is in private hands then you are paying the private sector.
There used to be a very easy mechanism for paying for both goods and services using stamps: postal orders. These were pre-printed in a narrow range of fixed values and stamps were used to make a postal order up to an intermediate value.3
Stamps are not legal tender in the UK and you cannot demand that someone accepts them as such. However, there is nothing to prevent anyone accepting them as payment for goods. In fact, this was common practice in the past when small items sold by mail order could often be paid for in stamps. ‘Send 1/- in stamps for bumper collection of jokes’ is typical of the sort of small advertisements found in 1960s children’s comics.
I can be used to pay taxes
Penny Lilac used to pay Stamp Duty, 19024
The use of small paper labels to indicate that tax has been paid pre-dates the introduction of postage stamps. The labels were used to show that document tax had been paid and were known as ‘revenue stamps’. Document tax was a small, fixed levy on certain types of documents, particularly those used for record purposes, including receipts, cheques, licences and wills. The tax was considered a payment to the government for its part in ensuring — through the courts and by force, if necessary — that the agreements recorded in the documents were upheld. The tax became known as ‘stamp duty’.
Most people in the UK associate stamp duty with the tax payable when property is bought and sold. This is actually a tax on the transfer of title and is proportional to the purchase price. It is not a document tax and I doubt very much that it can be paid in stamps.
A document tax can have unintended consequences. The Stamp Act of 1765 introduced to the British colonies in America a tax on printed documents. It wasn’t very popular, gave birth to the slogan ‘no taxation without representation’, started a revolution and, ultimately, led to a chap called Trump taking up residence in the White House.5
When Roland Hill launched the world’s first postage stamp in 1840 — the Penny Black — it was really just an extension of the document tax. The stamp showed that a tax had been pre-paid to the state for delivery of a paper document. Prior to Hill’s introduction of the Universal Penny Post, postage fees were paid by the recipient and could be very high, being based on distance and the number sheets of paper. Receiving a single sheet could cost a shilling or more — a day’s wages for the working poor. Under Hill’s system, sending several sheets in an envelope was pre-paid by a tax on the sender of one penny, no matter how far the destination.
This explains the word ‘philately’, which is derived from the Greek philéō meaning ‘I love’ and atéleia meaning ‘exemption from tax’ — referring to the fact that the recipient of a letter doesn’t have to pay anything.6 So, technically, we can call anyone who avoids or evades tax a ‘philatelist’, a lover of exemption from tax. Perhaps the Left should use this in their campaign to get the rich to ‘pay’ for government spending:
Down with the philatelists! Stop them stashing our money in tax havens!
Postage stamps were issued alongside revenue stamps until the Customs and Inland Revenue Act of 1881 when the two types were combined and a new stamp was issued — the Penny Lilac — bearing the words ‘Postage and Inland Revenue’. From that point forward you could indeed pay tax with postage stamps.
The words ‘postage’ and ‘revenue’ were included on all British definitive stamps, like the two at the top of this article, right up until 1967 when both words were dropped. By the way, you may need to adjust your initial interpretation of the ‘Tax Payers’ caption I added to those two stamps.
I am cancelled when I am used to pay tax or for state services
Cancelled half-penny stamp, Lancaster 1903
When a stamp goes through the postal system or is used for revenue purposes it has to be cancelled to prevent it from being reused. In the case of postal use it is partially obliterated with a postmark and for revenue use it is often done with pen and ink — a signature, for example.
It’s the same with government spending. Quite a few critics of MMT misunderstand the theory and think that it advocates abolishing taxes. If there were no tax then, just like uncancelled stamps, money issued into the economy by the state would be available for infinite reuse. Inflation would soon result if the state continued to spend. Tax ‘cancels’ the money issued by state. Tax prevents inflation.
The only difference between taxation and cancelling a stamp with a postmark is that the latter only allows for single use, whereas the former allows multiple uses, albeit with reduced purchasing power after each use. Tax only cancels a portion of the money spent in a taxable transaction, but over time and after multiple transactions the money is completely destroyed.
Tax destroys money which was previously created out of nothing by the state. The state doesn’t need the tax money in order to continue spending. Tax money is not re-spent. Anyone who thinks that it is should ask themselves why the government is not obliged to soak stamps off envelopes in order to keep the postal service running.
I am debt owed by the state
State debt, GB 19387
An unused postage stamp clearly represents a liability of the stamp-issuing state because it is obliged to swap the stamp for postal services. Every liability must be matched by a corresponding asset and this is no less true for stamps. From the holder’s perspective a stamp is an asset, it is a ‘postal credit’.
It’s much the same with money. Money represents a liability of the currency-issuing state because the state is obliged to accept its own money in payment for taxes. In the same way that a stamp is postal credit, money is simply a tax credit.
The state should only ever accept its own money in payment for tax because this is what gives value to today’s apparently worthless ‘paper money’ (money not backed by gold). We are willing to accept ‘paper money’ in payment for goods and services because we will need it to pay tax.
State issued currency — state debt — can exist in multiple forms. For example:
- paper cash as shown here;
- entries in a computer system owned by the Bank of England;
- entries in a computer system owned by the Treasury; or
- entries in a computer system owned by National Savings and Investments (NS&I).
All four of them are a ‘bond’, a form of debt, issued by the state. The only real difference between them is their lifespan, how much interest they pay and the form of that interest.
State debt in the form of cash is effectively a zero-interest, perpetual bearer bond. It’s a bond which pays no interest, which never expires and which belongs to the ‘bearer’ — whoever is currently holding it in their wallet.
Currency registered on the Bank of England system is perpetual and pays a small bit of interest. It is usually registered there by a commercial bank on behalf of its customers (individuals cannot have accounts at the Bank of England). This means that a positive balance on your bank account isn’t really ‘money’ in the sense of it being state debt. It is a debt owed to you by your bank which is matched by an equal debt owed to your bank by the Bank of England. By the way, if anyone starts talking about the Bank of England being ‘independent’ you should stop listening to them. The Bank of England is a wholly owned subsidiary of the Treasury.
Currency registered on the Treasury system is slightly different. These are Treasury bonds or ‘gilts’. They pay a bit more interest and expire after a period ranging from a few months to a few decades. When a Treasury bond expires it is converted into an equivalent amount of debt held at the Bank of England or is simply rolled over into another Treasury bond. The process of ‘repaying the debt’ represented by Treasury bonds requires nothing more than swapping a few entries between computer systems — tax money is not required and it is never a ‘burden’ on future generations.
An example of currency registered on the NS&I system are Premium Bonds. These are perpetual, registered directly in an individual’s name and pay a strange form of interest called ‘winnings’.
All modern money is, and can only ever be, debt. Anyone who campaigns for ‘debt-free’ money really doesn’t know what they are talking about and needs to have a chat with an accountant about how double-entry bookkeeping works.
The state will pay interest to the people who have collected me
Post Office Savings, GB circa 19258
To the best of my knowledge, the state has never made periodic payments to anyone as a reward for the contents of their stamp albums. But the state did once reward a different form of stamp collecting: deposits in Post Office Savings Banks. As you can see here, this was a particularly good method of encouraging children to save. Get them saving when they are young and with any luck the habit will stick.
Unfortunately, the concept of saving causes no end of confusion. It’s clearly seen as a good thing for the individual, but as Keynes pointed out in 1931, it’s not necessarily good for society:
Whenever you save five shillings, you put a man out of work for a day.9
If savings lead to unemployment, why does the state allow us to put our money into savings? Remember, ultimately, all saving is with the state, whether it’s cash in your wallet or the Treasury bonds which pension companies are obliged by regulation to buy. Surely the state should stop people from saving, shouldn’t it?
Well, the MMT view is that the state probably shouldn’t pay interest on savings, whether it’s Bank of England reserves or Treasury bonds. After all, it is really just welfare for the rich — because it is they who are most able to save — and it would be better for their money to be used productively.
However, there is one reason why the state might want us to save and that’s because savings are really a form of taxation. I know that sounds crazy, but bear with me; it does make sense.
When people think of tax they usually think of it in terms of coercion. Tax is something the government forces us to pay and prison awaits those that don’t pay. Tax certainly is coercive, but it is a necessary mechanism for removing money from the system so that the government can continue spending without causing inflation. Savings have exactly the same effect, but without the coercion. Savings also remove money from the system and allow the government to continue spending without causing inflation.
The only difference between tax and savings is that tax is compulsory and permanent (no choice, you never get the money back), whereas savings are discretionary and temporary (your choice, you always get the money back).
So, there will be occasions when the state encourages us to save because it increases the amount it can spend into the economy without risking inflation and without having to raise tax rates. The more the state can spend, the more it can direct the use of real resources. The more it can move real resources around, the more it can further the public purpose. And in doing so, the state can always employ the ‘man’ that you put out of work.
There is one a good example of the state actively encouraging savings as a form of taxation: War Bonds. During the world wars the state needed to withdraw money from the economy because it was spending on a massive scale, directing all the country’s resources for a single purpose. It could have done it by increasing taxes, but that would have meant taking money away and we are psychologically indisposed to that. It would have engendered feelings of defeat. Instead, the state played on feelings of patriotism and encouraged people to help with the war effort by ‘lending’ to the state. As compensation for voluntarily and temporarily removing money from the system the state paid a little bit of interest.
And guess what? In both world wars the UK government issued special War Bonds stamps for people to save.10
Foreigners accept me in return for real resources
Unprinting money, Russia 1966
Many governments have taken advantage of the popularity of philately as a hobby and have issued new stamp designs solely for the purpose of sale to collectors. This is particularly true for countries that have a desire (and indeed a need) to acquire foreign currencies and was very much the case for the countries of eastern Europe prior to the ‘collapse of communism’ and before we all abandoned the gold standard.
In the 1960s, for example, large quantities of stamps were printed for export to dealers based in those countries which had ‘hard’ currencies. The stamps were heavily discounted below their face value (remember: stamps cost virtually nothing to create) and this provided the dealers with an opportunity for large profits. The collectors were duped into thinking that the high face values meant that they were getting a bargain.11
There was one little problem: stamps are currency. The stamp issuing countries were printing money and selling it abroad at a discount. On the face of it, that wasn’t a problem because the stamps couldn’t be ‘spent’ abroad. However, if those stamps made their way back into the issuing country they could be spent and had the potential to lower the perceived value of officially issued stamps. Why buy stamps from the post office when you can get them at half price on the grey market?12 The purchasing power of the domestic currency (in the form of stamps) would be diminished. In other words, there would be inflation.
The solution was to cancel the stamps before they were exported. Whole sheets would be hand postmarked in a process known as Cancelled to Order (CTO). In most cases the CTO postmarks would be positioned on each stamp in a manner most pleasing to collectors — a quadrant across a corner is best. You can usually tell a CTO stamp by its improbably perfect postmark. That and the fact that the gum is still on the back because it has never been through the postal system.
In summary, people in one country were depriving themselves of real resources (because they had less money to spend) in return for worthless bits of paper. People in the other country were swapping bits of worthless paper for real resources (which they could buy from other countries with the ‘hard’ currency they were earning).
Which is not unlike how international trade has worked ever since we came off the gold standard. The UK is a net importer from China and the Chinese are happy to collect our currency (which costs us nothing to create) in return for the real resources they send by the ship load. However, there is one major difference when compared to CTO stamps: we don’t cancel the currency before giving it to the Chinese. This means the Chinese can spend the money here at some point in the future and critics of MMT identify this as a big problem. It isn’t. As long as the UK has the ability to impose capital controls then we can always ensure that the money is spent in a way that is advantageous to both the UK and China.
The state issues more of me than gets cancelled
‘The Deficit and The Debt’, circa 189013
There would be a shortage of stamps if, in any given period, the state only issued as many stamps as had been cancelled by being passed through the postal system. That’s because some unused stamps end up in stamp albums and never get cancelled.
Let’s look at what would happen if the state stuck to some bonkers rule which said that it must only issue as many stamps as it cancels.
Suppose the philatelists want to collect uncancelled stamps amounting to 5% of the stamps issued in any given period. Then in the next period the state is only able to issue 95% of the stamps required to keep the system going. And in the next period the artificial limit is reduced by another 5% and so on. People soon find that they are unable to send letters because the state is not allowed to print enough stamps. Even although the state has the capacity, it is prevented from providing essential services because of a silly rule.
People end up queuing for miles outside post offices, hoping to get their hands on a few precious stamps. State employed postal workers are laid off. Mail order companies go bust. The country goes into recession as the effects of the redundancies ripple through the economy. There are stamp riots.
The private sector, sensing an opportunity to make a quick quid, steps in to provide a bastardised version of the postal service. Some of the former postal workers are taken on by the new providers as ‘self-employed’ contractors — but at considerably lower wages. The public are offered a confusing array of packages, plans and deals — up to 40 letters, 2 small parcels and 1 recorded delivery for only £75 per month on a 36-month contract. The government believes it is powerless to do anything about the crisis and merely urges people to switch providers. Competition between the new companies drives up prices.
The right-wing press are relentless in their support for the new model. The liberal press eventually falls into line too. Over time, the public forgets what it was like when the state provided essential services or, more accurately, when the state was allowed to issue as many stamps as were needed. There is a paradigm shift and the public begin to see the mess as the natural order of things.
The public’s acquiescence is partly down to a new focus on the individual. When the time is right, the big postal corporations use this individualism to blast away the bedrock which has supported postal services for 180 years — they abandon the idea of the Universal Post. Not only are postage rates now calculated by distance, but also by remoteness. Heaven help those who live in Cornwall or Caithness.
Eventually, the idea of pre-paying for delivery with a stamp is abandoned too and we go back to recipients having to pay to get their letters. The public now believes that it is only common sense for someone who ‘chooses’ to live at Dunnet Head to pay dearly to have their mail delivered. Solidarity finally departs these isles.
You probably see where this is going, so I’ll stop there.
Matching stamp issue to stamp cancellations is madness and nobody could possibly support the idea. But then many people can’t see that this is exactly how they want the country to be run. These are the people who invent a scary name for the difference between the amount of money the state issues in a year and the amount that is cancelled by tax: they call it ‘the deficit’. And they claim it has to be eliminated at all costs. Even the Labour Party is committed to getting rid of ‘the deficit’ within five years of taking office.14
These people are unable to grasp that ‘the deficit’ is no more scary than adding a few more stamps to our stamp albums each year. And the thing they call ‘the debt’ is just the sum total of all the stamps in all our stamp albums. It’s just our savings and it’s nothing to worry about.
My greatest fear is hyperinflation
Hyperinflation, Germany 1923, Hungary 1946
Stamps don’t cope at all well with hyperinflation. They either have to suffer being overprinted or have a very short lifespan. The examples here show what happened in Weimar Germany in 1923 (overprinted due to 1,000,000% inflation) and in Hungary in 1946 (issued 15 July, withdrawn 31 July).
The Hungarian stamp has a face value of 40,000 adópengő. The adópengő was introduced at the beginning of 1946 purely as an accounting unit and was used alongside the pengő, which was the real currency. Adó in Hungarian means ‘tax’, so the adópengő was ‘tax money’. It was introduced so that the government didn’t have to bother with an excessive amount of zeroes in its accounting procedures, particularly in relation to tax. They set the amount of tax due in terms of the adópengő and you paid in pengős at whatever the going rate was that day.
Eventually it all became too cumbersome and the adópengő was adopted as the currency. This must be the only time that the true nature of money — that it is a tax credit — has been reflected in the currency’s name.
Conclusion
Well, that was a bit weird. Five thousand words explaining the descriptive components of Modern Monetary Theory through the medium of postage stamps. And I haven’t even begun to talk about the prescriptive elements (although I did make one oblique reference to the Job Guarantee).
It’s difficult writing something which covers so much because there’s a limit to how much text people are willing to read and I had to choose what to include and what to omit. Making those choices means that I am never going to please everyone.
For example, in the section on savings I had to choose one topic for discussion. I went with the ‘savings are voluntary taxation’ angle. Some proponents of MMT will say that I should have gone for the ‘bonds maintain interest rates’ line of reasoning. Some will say that I should have explained how the current arrangements mean that a fair chunk of our savings end up being used by pensions fund managers to buy their yachts. Instead I opted for a simple example — one that most people will understand, one that will sow a seed.
If nothing else, this piece demonstrates how MMT leads us to examine apparently unrelated bits of the world in ways previously unthought. As Scott Ferguson says:
After Modern Monetary Theory, nothing looks the same: not political economy; not everyday caretaking; not paintings, pop songs, or porn sites.15
Hopefully, the opposite is true — that by analysing the seemingly unconnected we will lead more people to an understanding of the theory.
It should also help with the problem of framing. When we talk about the theory in context we just end up reinforcing existing frames — internalised concepts, ideas and beliefs. Mention ‘tax’ and pre-existing neural pathways fire up in the listener’s brain, pathways that lead to a stored frame that says ‘tax pays for spending’. The frame is there because people have heard the assertion over and over their whole lives. And once that frame has been brought to the fore it is very difficult for the listener to consider an alternative.
Hence stamps. Create a parallel frame using a different terminology and there is a greater chance of disrupting the stored frame.
So, next time you are faced with someone who doesn’t understand deficits ask them to explain why the state prints more stamps than it cancels.
1.
↵
Some proponents of MMT will be bristling at the suggestion that postage stamps are currency. If you are one of them, I urge you to read on before passing judgement.
2.
↵
Image source: Postal Order Provisional Govt Ireland overprint 1922 [Public Domain], Wikimedia Commons
3.
↵
Postal orders still exist, but are now produced on demand in any value requested. They no longer need stamps to top them up.
4.
↵
Image source: Carnegie receipt from Wolverhampton Council [Public Domain], Wikimedia Commons
5.
↵
No, I am not saying that the American colonies should have stayed under British rule.
6.
↵
See ‘philately‘, Wiktionary, ‘philately‘, Oxford English Dictionaries and, weirdly, Cumberland Times/News, 12 June 1987.
7.
↵
Image source: 100 Pound White Note 1938 Peppiatt obverse [Public Domain], Wikimedia Commons
8.
↵
Image source: George V Post Office Savings Bank deposit slip [Public Domain], Wikimedia Commons
9.
↵
John Maynard Keynes, Essays in Persuasion, [1931] 1963, Norton & Co, p152
10.
↵
The imagery used on war savings stamps issued in the UK has very different connotations today. In the First World War it was a swastika; in the Second World War it was a burning cross.
11.
↵
What’s worse was that many of the collectors, the end consumers, were children and were targeted through advertisements in children’s comics. The issuing countries colluded in this exploitation by churning out brightly coloured designs based around themes which appealed to children — butterflies, space travel, horses, cars, cats, scouts, locomotives and so on. Relevance to the issuing country was unimportant.
12.
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See Grey market, Wikipedia
13.
↵
Image source: Another old album [CC BY-NC-SA 2.0], Flickr.
14.
↵
’Our manifesto is fully costed, with all current spending paid for out of taxation or redirected revenue streams. Our public services must rest on the foundation of sound finances. Labour will, therefore, set the target of eliminating the government’s deficit on day-to-day spending within five years.’ Balancing the Books, Labour Party Manifesto, 2017, The Labour Party.
15.
↵
See The Unheard-of Center: Critique after Modern Monetary Theory, Scott Ferguson, Arcade, Stanford University.
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The post Lovers of exemption from tax appeared first on The Gower Initiative for Modern Money Studies.