1, 2, 3, 4, I declare a class war?

Hold on, that’s thumb war, isn’t it?

I always lose at thumb war. Short, stubby fingers, y’see.

Here’s what I don’t get.

When I talk to serious people in badly cut suits, they are unanimous in their opinions. “Oooh, the deficit is troubling”. They say, grimacing in fiscal sympathy. “It’s all very serious” they add, stroking their chins in deficit based peturbation. “Sacrifices must be made” all concur, gazing steely eyed towards a future of budget balances and restraint.

You know what? I agree with them.

I sit alongside, in my own badly cut suit, grimacing and chin stroking and gazing sternly at the dissolute world with the best of them. I nod along solemnly when, to quote Benedict Brogan, we hear the regular call for a “politics, not of them and us, but of “we” “.

But to indirectly quote Tonto, I have to respond, “Who exactly is this “we” Kemosabe?”

Because when it comes to asking people who have done very well out of prosperity and asset growth to contribute towards last and this years current economic rescue operation, I’m all for it.  Go right ahead, I say.

But apparently this is infra dig. It is class war and would negatively impact the entrepeneurial spirit. 

To which I have to ask- What, do only the asset rich or people on over £100,000 a year people have an enterprising spirit then?

(£100,000 a year, I note, represents the top 1 percent of the population, but only the top 50 per cent of Telegraph columnists. Some regard two and a half times that as chicken feed. Now that’s the spirit of enterprise our country needs. )

Further, that top 1% has enjoyed income growth 50% higher than the average over the last decade. If there’s been a class war going on, only one side has been winning, and it’s not the poorest.

To get the economy growing, I think we need to see businesses started by parents on middle incomes – people on twenty or thirty thousand a year-, and help given to families who need tax credits to help them if they find work, and support given to those who have young children.  

I think it’s their prosperity that is going to help us drive growth, and I don’t quite see what reducing corporation tax for companies that earn over £1.5 million in profit each year will do for them, or why the assets of the very rich are more sacrosanct than the VAT rates paid by the poorest.

On the other hand,  I think good schools that help people to get the qualifications that lead to better jobs, support for childcare so more people can start businesses, and a ultra-low rate of tax for ultra small companies, combined with a capital allowance that encourages small business start ups, are pretty good ideas for encouraging entrepeneurship and enterprise.

Equally,  on the personal tax front, I’d rather see unearned inheritences of over £600,000 and multi million pound bonuses taxed than VAT put up which woud hurt small business margins, or a fiddle with the allowances, which would radically reduce the incentives for lower and middle income families.

Yet apparently this is class war.

Gosh.  We’re setting the bar a bit low for that, now aren’t we?

So I want to ask my comrades in the single colour ties a question.

If we’re all in this together, how come it’s only the poor and middle incomes who get told they have to pay the price – whether through worse public services, higher taxes or an attack on their ability to create wealth?

How come the “unspoken consensus” of our media is that the bonus millionaires, the big companies and the children of wealthy parents represent a higher priority for our countries limited resources than anyone else?

You know, I might look like just another centrist wonk, but underneath this M&S suit apparently lurks the heart of a class warrior.

It’s oddly thrilling. Like suddenly discovering you’re spiderman. My friends. I pass, like night, from think-tank to tank, and have acquired, like the mariner, a strange power of speech.

Let the fight begin.

15 Responses to “1, 2, 3, 4, I declare a class war?”

  1. Hadleigh Roberts

    A Labour MP used the same logic with regards to the 50% tax rate. If you’ve had 10 years of good times, and you’re STILL making over 100,000 in the BAD times, you should have a at least bit of spare change to add to the pot.

    Oh, and I got my suit from Tesco; F+F.

    Reply
  2. Paul Hughes

    Why is it so hard to understand that somebody earning £100k pa is already paying several times more than one who earns £10k….

    It’s this nature of economic illiteracy which has driven the country to this pass in the first place.

    And, no, I don’t earn £100k. Not even close.

    Reply
  3. hopisen

    Paul, I’m not quite sure why

    a) you feel people don’t know that people on 100k pay more tax than people on 10k

    B) why you feel that should be a clinching argument.

    Reply
  4. hopisen

    Actually I got it wrong.

    My suit is froms slaters menswear.

    My current favourite jeans are blue harbour though.

    Reply
  5. tim f

    Worth pointing out that all taxes inclusive, most people paid £100k pa pay a smaller proportion of their income in taxes than people on the median wage.

    The Tories have really overplayed their hand on these “class war” allegations. Every mention of inequality seems to be met by “class war”. Cameron’s outburst on Sunday that Brown was “stupid” made him seem like a spoilt public schoolboy, thus reinforcing the narrative he was trying to downplay. If they’re not careful they’ll undo much of the modernisation work Cameron has done (or simulated).

    Reply
  6. newmania

    You quote the IFS on the growth of incomes in the top 10% . I have no doubt you will recall that the IFS also predicted the new top rate will lose revenue …. Gordon Brown, again was certain this was the case for ten years , so what has changed ? Not the popularity of taxes on the rich, they are always popular ,as indeed are any taxes on ‘other people’. So either Mr. Brown undergone a coincidental Damascene conversion to the Growth potential of levelling down.. or this is spending our money on dim witted populist electioneering. Teaser eh .
    What fascinates me is the way you seem to have convinced yourself that it was actually a good thing to utterly misjudge pubic spending because that means we have to borrow and print money which is “good” for the economy . Its like saying we could all fly if we kicked our own arses hard enough. I love your genius theory that more and better paid teachers is the what our little company chiefly needs .

    Course it is.

    Weird Post it does not read like your usual urbane and persuasive Vaz-eiline , a bit cross I `d say .

    Reply
  7. Martin Coxall

    The top 5% of the population generate 40% of the tax revenues. That’s the population that you don’t want to drive away, or we’ll be even more screwed than we are now. So, it’s odd that seems to be Labour’s primary aim.

    Also, as a result of the the fact that the more successful you are, the more disproportionately you are punished, tax increases have a disproportionately catastrophic effect on moving the Laffer curve, thus potentially causing tax revenues to plummet, driving the country further into bankruptcy.

    But then you should know all this, Hopi. Isn’t it fairly elementary economics?

    Reply
    • hopisen

      No, it’s a generalisation. You have no proof that we’re at that point on the laffer curve.

      You’re also wrong to say “the richer you are the more disprortionately you’re punished.

      The marginal rate of tax for people in the middle income deciles is higher than that for people in the top decile (ave income here 94k), than it is the middle income earners.

      So you’d be better off arguing that is is people of 20-50k a year who are on the wrong side of the laffer curve, not the wealthy.

      Reply
  8. Jakemottas

    I just agree…. I do earn over 100k and this is down to a number factors, but I cannot ignore that I have been educated and cared for , in life threatening moments, entirely at the Tax payers expense. It is my belief we should be a higher tax society as I think it is the only way to even approach equal opportunity for all. Whether its a class war is probably down to how issue rolls across the media (can’t exactly see Chelsea and Kensington being stormed by the masses…) I just think its the old fashioned divide between right and left

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  9. newmania

    No, it’s a generalisation. You have no proof that we’re at that point on the laffer curve.

    That is what has actually happened. At the time of the high rate you argued that the IFS actually posited a range of possibilties in fact they did but concluded that the probability was a loss of revenue(Robert Chote ).
    Discussions of altering this effect which can be taken seriously include finding ways of stopping people from moving their money and it has been much discussed ) .The end point is a closed border and it is prettyy easy to see that the long term effects of such policy would be horrific.
    I suspect you are quite aware this is a silly side show , the intention is imply that no-one but the rich will suffer simply by talking about it .

    That is a lie of course but a lie no-one explicitly has to tell.That is the point of stoking up class envy I also suspect with 8,000,000 plus dependents directly in the State`s employ New Labour are wanting to imply that under them their jobs are safe and keep on this Toff rubbish.

    Reply
  10. Wendy

    I wonder how many people recognised the Tonto quote from the brilliant Lone Ranger cartoon which appeared in Mad magazine many moons ago. Together with the craftily worked in Ancient Mariner observation, methinks we have here a budding master of the obscure reference – and a widely read one at that.

    Reply

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