Abandon All Fear

What nobody else seems to be saying…

[Elite] Rich Benefits

Posted by Lex Fear on March 7, 2007

I’m not in the least surprised by this little item, it’s pretty much elementary.

I’m not an economist (so feel free to correct me if you have a valid counter-argument), but the truth of the matter is that taxes rarely affect the rich or the Corporati. I don’t need to explain this because our PM has already done so in a recent interview on Newsnight:

PAXMAN: Do you believe that an individual can earn too much money?

BLAIR: I don’t really – it is not – no, it’s not a view I have. Do you mean that we should cap someone’s income? Not really, no. Why? What is the point? You can spend ages trying to stop the highest paid earners earning the money but in an international market like today, you probably would drive them abroad. What does that matter? – BBC, Newsnight

Therein lies the crux of the problem, the richer you are the freer you are to choose where to live and where to conduct business. That is why the rich get richer and the poor get poorer. It is the reason why raising taxes only puts the poorer of society in a more vulnerable position. Those who can afford a ticket leave the island, those who cannot stay and pay.

Furthermore, those of the Corporati that can and do continue to operate in the UK, simply pass tax increases on to customers, they lose none of their profits, but again the poor are the most affected.

It is also the reason why the more you try to level the playing field, treat people more equally (economically, at least), the less equally people actually are. Fines imposed to discharge offenses are a good example of this, and why I fight against all types of fixed penalties and charges imposed by councils, police, and banks.

£60 acts as a deterrent to a low income family which perhaps constitutes weeks food shopping budget, where as to wealthy Corporati it is a nuisance, but nowhere near a relative punishment. It’s also worth stating that a fine imposed before guilt is established by a court of law, to discharge responsibility for an offense, is nothing more than a legalised bribe.

Does lower taxes solve the problem? For individual autonomy it does, slightly. However this does mean that public services are vulnerable, and although the poorer may be a little less poor, they also start to lose the subsidised services they may depend on.

So is there an alternative? I remind you once again I am no economist, but perhaps. Here are my suggestion:

  • Start by increasing the tax free earnings threshold, for individual (PAYE or SE) only. Don’t increase minimum wage, this only pushes up inflation- there is no relative improvement.
  • Cease and ban all fixed penalties and charges- use the courts, that is what they are there for. If an activity is a crime, then treat it as a crime, otherwise change the law to remove the offense.
  • Use discretion instead of check boxes and targets.
  • Introduce enforced regulation to banks, make cash a choice again, with no credit penalties.
  • Lower taxes/abolish income tax for employees and SE, raise taxes for Corporati- highest band reserved for foreign Corporati. Corporati are driven by market demand. If you make individuals more well-off, then the Corporati will pay the extra tax to have access to the market.
  • Put quality above cost in offering public services. Currently public services such as the NHS are spending millions in compensation claims per year. Similarly the compensation for our privatised subsidised rail services runs into the millions. Stop selling out to the lowest bidder and invest in quality service. Spending money on quality eventually brings it’s own returns through reduction in cost to lives, compensation and maintenance.
  • Get rid of all consultants. D works for a public organisation (hmm, got you wondering…) and testifies to the complete lack of knowledge in overpaid and useless consultants working there, yet they are still treated like gods.

Just a few suggestions, none tested but willing to hear your thoughts.

UPDATE: 11/03/07

P.O.S. Blogs on the tax system explained in simple terms, posting an article from Prof. David Kamerschen of University of Georgia. It pretty much explains it all:

Tax Cuts Only Help The Rich!!!

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