Tony Benn in his diaries talks of a 40-year rule. Every 40 years, give or take, there are political events that change the face of British politics. The repeal of the Corn Laws in the 1840s split the Tories, a rump of which joined with the Whigs to form the Liberal Party in the 1859. The Home Rule bills split the Liberals in the 1880s. In 1928 women received equal voting rights as men. The end of the Second World War heralded in the Post War Consensus and welfare state, relaxations of social policy as well as membership of the EEC. Thatcher’s government in the 1980s reformed the British economy to such a point that we now face a new set of questions, not quite 40 years hence in fitting in with Benn’s ‘rule’, but questions are being raised now that can set in motion epoch-changing events in the coming years.
Capitalism has been given a knock, that isn’t in dispute. The choices now are between big or smaller government and what government can afford to do with our money.
With £500 billion of taxpayers’ money – or £16,000 per taxpayer – given to support and effectively subsidise ailing banks, we have witnessed not only an unprecedented intervention by the state but also a bill that needs to be paid in future years. Yet we must fight tooth and nail against high taxes when the government in the past 11 years has done nothing but squander what it has involuntarily appropriated from us.
Nick Clegg writing in the Independent today fights the big government tendency, saying that tax rises now would be madness. His only failure is to resort to some populist “tax the rich” mantra whilst pledging to close the loopholes used to get around taxation. The easier thing for him to do would be to endorse the flat tax. A simple, flat rate with generous allowances would take the poorest out of income tax and ensure that everyone above the threshold pays the same percentage of their income. With no loopholes or exceptions, there would be no way out of paying. Simply put, the poorest receive a massive tax cut. The rich, by contrast, would see their 40% rate lowered, thus removing the opportunity cost of paying an accountant to get around taxation. Surely that system is far fairer than the 10,000 pages of tax code we have now?
Clegg is right on spending cuts, however, but needs to go that step further and embrace the flat tax to give his message added coherence. On the other side there is already panic at ConservativeHome that the Conservatives aren’t being bold enough in defending free market capitalism.
The majority of politicians, liberals and conservatives, aim to defend the capitalist system, that much is clear. What they must do now is seriously heed our message and our campaign against waste and focus on what government can afford in relation to what taxpayers view as an essential service.
For example, Kent County Council today goes cap in hand to the government asking that the £50 million it had in a failing Icelandic bank be protected by the government. Never mind that Kent County Council has its own TV station as well as a Youth County Council that we taxpayers fund. Hertfordshire County Council has a department to encourage young people to take up music. The endless waste needs to be stopped and rooted out because as the crisis worsens, we’re paying a price for an extravagant, politically-correct conscience politics we can ill afford. The eccentric is turning into the inexcusable.
Not just at the local level are we paying a high price for non-existent returns. You could look through our Bumper Book of Government Waste for £100 billion of your money squandered in one year alone. But yet the crisis hasn’t prevented the government planning a £12 billion spend on a database to record individual emails, texts and telephone conversations. Finally, at the international level, don’t forget that we give tens of billions a year to the European Union for which we are handed more laws, regulations and directives.
British politics is coming to the crossroads where it has to choose where it wants to go. For too long the political class has ignored the serious questions of the size and role of government. Do you now want these politicians to continue to spend your money, to ignore the important questions and to hand all of us a bigger tax bill at the end of it? You can and do answer the question with a resounding 'no' to high taxes and big government. It's up to us all, as voters and taxpayers, to see the politicians fall in line, cut our taxes and end the waste.