Is less government better government?

May 28, 2014 5:14 PM

Last night I debated 'Is a Smaller State a Better State' at the Bristol Festival of Ideas, with Labour peer Maurice Glasman and the Observer's chief leader writer Yvonne Roberts, chaired by the Observer's assistant editor Julian Coman.

The debate was interesting with three distinct views, but there were also striking areas of agreement across some of the topics discussed.

My argument was largely focused on the economics and ethics of high levels of spending and taxation, while also acknowledging various other regulations and prohibitions which affect people's lives outside the tax-and-spend framework.

On the economic question, I talked about the overwhelming evidence linking lower levels of government spending and taxation with faster, more dynamic economies. There are countless studies in the academic literature which almost universally demonstrate that the size of government where the economy grows fastest is far below the 43 per cent of our national income which the government now spends. These studies have been discussed in The Single Income Tax on pages 104 and 132. The contrast between the economies of France and Britain, and between those two countries and Singapore and Hong Kong, demonstrates the results point with remarkable clarity:GDP as proportion of UK

Regarding ethics, I talked about the coercive nature of tax and spend, and how it eclipses personal morality, promotes special interest lobbying and corrodes individual morality and politics. I drew heavily from the excellent essay by Eamonn Butler in The Single Income Tax (pp 79-87).

There were many areas of disagreement, but also many where we agreed. Maurice Glasman, meanwhile, made the case that incentives to work must be strengthened and Yvonne Roberts spoke of the feeling that the state does things to people rather than with them. There was also universal agreement that taxpayers being forced to bail out bank shareholders was deeply unjust.

At the end of the debate and questions session, the audience was asked to vote on whether the state was too big, too small or about right. About a third voted for each proposition.

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