Easing money

When the commentariat  complain so bitterly, Liz Truss must have done something right. It felt hollow telling voters that the Conservatives are the low-tax party – like Augustine praying ‘Make me chaste, but not yet!’ Maybe it can become a reality.

Tax is a harmful drag, like driving with the handbrake on. It is follows from allowing the swollen state, and the justification for keeping it at eye-watering levels has been the needs of the swollen state. The objection to reducing the burden has been that borrowing must soar, and that it true, unless the spending is slashed.

Tax is theft from my pocket, so every penny imposition must be justified or it must come off. Consequently, every penny of government spending is also theft from my pocket and that of my children, so every penny must be not only justified but necessary. One can argue for the benefit of any spending, but the necessity is doubtful.

The lowering of tax and a reduction in inflation will allow the economy to grow and to recoup much of the tax revenue lost, but not all of it.  The Laffer curve is not a smooth, mathematical equation. Even with that growth, spending must be slashed from its Brownite hugeness. Tinkering is not enough – necessary, yes, but not enough. The courage to cut tax in the face of warnings is one thing, but is there, a year and a half from a general election, the courage to slash and burn? It is needed.  (Cut the southern counties anyway. We have enough here to keep going.)

It is as if the Blair-Brown era is still with us.  It has taken 12 years and four PMs to remove Gordon Brown’s malicious top-rate tax bracket. What on earth did all those nominally Conservative parliaments think they were doing?

The political fall-out is to be expected – oppositions oppose, as they must: they have no duty to be coherent but they are duty-bound to shine line in the cracks, and soaring debt just as borrowing rates are at their highest is a massive crack.

Less respectable is the jeering over cutting the top tax rate – it is pure class-war rhetoric.  Effective though. There is a prevalent superstitious belief that when someone gets richer it must make someone else poorer. It is that superstition that is the great political challenge now.

If the economy revives, if inflation falls and the war in the East is stilled, then Liz Truss may survive the coming election. If not, a new team will barge in and wreck all that has been done. No – all that should have been done and which is just beginning to be done twelve years late.

In the meantime, cut and cut again: spending, bureaucracy and taxes too.

See also


Author: AlexanderTheHog

A humble scribbler who out of my lean and low ability will lend something to Master Hobbes