The Brexit Thread

[The Awesome Berbaslug!!!]

Piketty makes it abundantly clear that taxing wealth is the priority to reduce inequality, not income. Is he wrong?

Oh god no. but it's not really an either or, you deal with one on the path to dealing with the other. Dealing with inequality of wealth is something you start now with the intent of making medium to long term progress. Inequality of Income is something you can address in the short to medium term. It simply involves making the taxation system more progressive, and distributing some of that money to people at the bottom of the income distribution. It's the thing you do to make immediate improvements in people's circumstances. It's the thing that the Irish system focuses on to the exclusion of virtually everything else, which has a variety of negative effects. (Basically the irish govt will give you a relatively large cash payment, but then you are forced to make do in a very expensive world of very patchy private provision). As far as I can make out This is the single greatest measurable difference between Irish society and UK society. Ideally you would use taxes on higher earnings to limit income inequality, while using taxes on wealth (primarily property) to provide services that reduce the cost of living for everyone.

Raising taxes on wealth is hard as much of it revolves around taxes on houses. and addressing the situation of people at the bottom frequently involves helping them buy their own house.

but the issue remains that any govt, of any stripe, that is concerned with long term fiscal stability, and sustained economic growth (while avoiding bursting bubbles) should be seeking to construct as broad and as efficient a tax base as possible, to prevent the inappropriate allocation of resources (i.e. the unending rise in house prices is in no small part due to them being inadequately taxed, and an insufficient supply of state provision, which leads to serious intergenerational, and inherited wealth distortions, sucks money out of the actual economy in the form of absurdly high rents, or mortgage repayments, and in a time of low inflation, and relatively low wage rises winds up impoverishing people) but also to avoid placing all of the tax burden on those in employment, and on VAT. A broad tax base makes a country automatically better able to weather a global down turn, and minimizes the destruction of wealth and misery caused by such events.

From the point of view of the UK, it differs from the rest of Europe in that it has a serious inequality of income, and inequality of wealth problem. Countries in Europe that have taken steps to resolve the first, still have their fair share of problems as a result of the second, however there is less need for foodbanks.

[Nefertiti2]

Only about a third of private personal wealth in the UK is in property

[Nefertiti2]

one reason why wealth is more evenly distributed in Germany is because helping the poor doesn't 'frequently involves helping them buy their own house." That's a very anglo-Irish position. Security of tenure on rented proerty and beginning to provide adequate social housing- both issues the Labour manifesto- are ways of nmaking people better off and making landlords poorer. or not so wealthy. Likewise proper taxes on rental properties and incomes, holiday homes, second homes would all be ways to reduce the wealth gap.

[Duncan Gardner]

Just had an email from Alan Partridge reminding of the rallies on 23 March (I'll be in Belfast)

Slebs eh .Here's Michael Vaughan onhis show last night. "People don't like my opinions on Trump and Brexit". well not quite- current players can't stand you cos you say they're mainly rubbish

[NHH]

Oh god no. but it's not really an either or, you deal with one on the path to dealing with the other. Dealing with inequality of wealth is something you start now with the intent of making medium to long term progress. Inequality of Income is something you can address in the short to medium term. It simply involves making the taxation system more progressive, and distributing some of that money to people at the bottom of the income distribution. It's the thing you do to make immediate improvements in people's circumstances. It's the thing that the Irish system focuses on to the exclusion of virtually everything else, which has a variety of negative effects. (Basically the irish govt will give you a relatively large cash payment, but then you are forced to make do in a very expensive world of very patchy private provision). As far as I can make out This is the single greatest measurable difference between Irish society and UK society. Ideally you would use taxes on higher earnings to limit income inequality, while using taxes on wealth (primarily property) to provide services that reduce the cost of living for everyone.

Raising taxes on wealth is hard as much of it revolves around taxes on houses. and addressing the situation of people at the bottom frequently involves helping them buy their own house.

but the issue remains that any govt, of any stripe, that is concerned with long term fiscal stability, and sustained economic growth (while avoiding bursting bubbles) should be seeking to construct as broad and as efficient a tax base as possible, to prevent the inappropriate allocation of resources (i.e. the unending rise in house prices is in no small part due to them being inadequately taxed, and an insufficient supply of state provision, which leads to serious intergenerational, and inherited wealth distortions, sucks money out of the actual economy in the form of absurdly high rents, or mortgage repayments, and in a time of low inflation, and relatively low wage rises winds up impoverishing people) but also to avoid placing all of the tax burden on those in employment, and on VAT. A broad tax base makes a country automatically better able to weather a global down turn, and minimizes the destruction of wealth and misery caused by such events.

From the point of view of the UK, it differs from the rest of Europe in that it has a serious inequality of income, and inequality of wealth problem. Countries in Europe that have taken steps to resolve the first, still have their fair share of problems as a result of the second, however there is less need for foodbanks.

So, like the Labour manifesto, then - starting on the path to one by tackling the other. I mean, unless you'r advocating MMT, or a fucking socialist revolution, Corbyn can't on the one hand make moves towards massive redistributive tax changes without at the same time blowing the whole fucking economy, so it's a case of making as much a move as is prudent, rather that shitting out of doing anything.

They've already made a significant change by refusing to kowtow to the Sun and the Mail, which all sane commentators agree was a massive flaw in the Labour approach from the mid-1980s. They also don't share Blair pessimism about the potential for radical change in the UK, but - since they've become the leaders of the party - have developed a more strategic sense to how it is achieved.

(I'll just state for the record, I'm not even a fucking member. I think their stances on climate change are piss-poor, amongst other things, but fuck me, if you make me choose between them and the milque-toast centrist pricks, then it's a very easy choice)

[Lang Spoon]

The stigma around social housing is one of the worst legacies of Thatcherism, at least in scotland, which pre Evil had more folk in state housing than Warsaw Pact Hungary or Poland- even the lower rungs of the managerial classes could be found in harled walled cooncil semis when a majority of the population were renting from the housing board. Since right to buy the disgusting snobbery around schemes became prevalent.

I really don't see why helping people at the bottom means helping them buy their gaff, that just helps inflate asset bubbles in Dublin as the chinless progeny of D4 move to formerly forbidding no go areas and push out the poor. Seeing as U.K. and Ireland now seem unremittingly snobbish about Council/social housing, maybe future developments should be indistinguishable in style from private buildings (except prob built to a higher spacial spec).

But the Taoiseach is a disgusting Thatcherite from the party of Landlords, and half the electorate are secretly enjoying the housing crisis as the asset bubble inflates so nothing will change re housing in Ireland.

[Diable Rouge]

If there's a no-deal Brexit, neither the UK not Ireland will be stocking up on duty free.

[DCI Harry Batt]

I'd just like to say once again that I think Corbyn is fucking awful.

[DCI Harry Batt]

(But likening him to RBB is utterly ridiculous)

[Flynnie]

I'd just like to say once again that I think Corbyn is fucking awful.

What prompted this?

[DCI Harry Batt]

What prompts me to feel that way, or why say it now?

Actually, both are easy enough to answer. Mostly, I think everyone who has been utterly shit on Syria is fucking awful. And Corbyn has been utterly shit on Syria. Though his triangulating on immigration is also fucking awful.

Right now, because there's been another "you lot who don't agree with me all want to have Corbyn's babies" load of old bollocks on here, as there is from time to time. And I don't.

[Flynnie]

What prompts me to feel that way, or why say it now?

Mostly the latter, but hell, por que no los dos?

[DCI Harry Batt]

What's it called when your edit of a post crosses with someone's replying to it?

[The Awesome Berbaslug!!!]

So, like the Labour manifesto, then - starting on the path to one by tackling the other. I mean, unless you'r advocating MMT, or a fucking socialist revolution, Corbyn can't on the one hand make moves towards massive redistributive tax changes without at the same time blowing the whole fucking economy, so it's a case of making as much a move as is prudent, rather that shitting out of doing anything.

They've already made a significant change by refusing to kowtow to the Sun and the Mail, which all sane commentators agree was a massive flaw in the Labour approach from the mid-1980s. They also don't share Blair pessimism about the potential for radical change in the UK, but - since they've become the leaders of the party - have developed a more strategic sense to how it is achieved.

(I'll just state for the record, I'm not even a fucking member. I think their stances on climate change are piss-poor, amongst other things, but fuck me, if you make me choose between them and the milque-toast centrist pricks, then it's a very easy choice)

But you're assuming that there was something in the Labour manifesto about this. The thing is that there wasn't really. There was a bit about increasing taxes a bit on the top five percent of earners, but not on anyone else, and there was almost nothing about benefits in the manifesto. Indeed one of the controversies surrounding the manifesto was that Corbyn announced that they were going to get rid of the tory cap on benefits. The only thing was that it wasn't in the manifesto, it wasn't costed, and it wasn't clear how they were going to pay for it. It was clear that they had completely forgotten about it. Fortunately it was largely overshadowed by the tories abandoning their plans to with getting people to pay for their long term care out of their house.

The thing is that redistributive tax changes wouldn't blow the economy. Far from it. Taking money from the top end of the income distribution and redistributing it among the many, to a greater degree than happens in the UK, works out fine in most EU countries that do more of this than the UK, which is basically all of them.

[Nefertiti2]

you really are just in a conversation with yourself, aren't you?

people point out that tackling wealth is more importnant than tackling income and you say that's impossible because the majority of wealth's in property. People point out that's not true . you start saying that making the poor wealthier means letting them buy their own homes. people point out that untrue you come back to the level of income tax.

[Lang Spoon]

Berba, when you talk about all the EU being more redistributive than the U.K., do you mean the EU15 of old, or are you including flat taxing Welfare State hating places like Latvia?

[E10 Rifle]

Berba has an underlying point in that Labour's 2017 manifesto and thinking on taxation is quite timid in many ways, but it's still a step change from Labour policy of the previous 20 years. And away from the economics, there are other things that are key: for example, can you imagine any of Corbyn's three predecessors speaking out in favour of Shamima Begum retaining British citizenship as Corbyn has? Seeing Chris Leslie equivocate pathetically on this issue on Question Time last week gave us our answer

[The Awesome Berbaslug!!!]

I really don't see why helping people at the bottom means helping them buy their gaff, that just helps inflate asset bubbles in Dublin as the chinless progeny of D4 move to formerly forbidding no go areas and push out the poor. Seeing as U.K. and Ireland now seem unremittingly snobbish about Council/social housing, maybe future developments should be indistinguishable in style from private buildings (except prob built to a higher spacial spec).

But the Taoiseach is a disgusting Thatcherite from the party of Landlords, and half the electorate are secretly enjoying the housing crisis as the asset bubble inflates so nothing will change re housing in Ireland.

No I don't think you should sell off council housing. It's a nightmarishly bad decision, and ultimately a good many of those houses wind up in the possession of large private landlords, when the owners who got the windfall cash in. But the thing is that most wealth is tied up in housing, 60% in Ireland, 70% in the UK and the most meaningful way to help people at the bottom of the wealth (not income distribution) is help them get their hands on a house. The Wealth of most households is basically the equity they own in their house, and their pension plans minus their debts, and a few other bits and bobs. So you can see that it's I difficult to start doing positive things to help people at the bottom unless they have savings, or you help them acquire an asset (And you mostly do it indirectly by seeking to increase their disposable income, and reducing their costs to the point where they can save money)

The Irish problem with council housing has very little to do with our taoiseach, and an awful lot to do with our attitudes towards housing, taxation and other people.

Berba, when you talk about all the EU being more redistributive than the U.K., do you mean the EU15 of old, or are you including flat taxing Welfare State hating places like Latvia?

It's higher in latvia and lithuania, by choice. It's slightly lower in estonia. It's the same in Romania, but those aside you're down to countries in severe trouble like Greece, Italy, Spain and Bulgaria (which is dying, they're going through a population collapse to rival Ireland in the century after the famine without the birthrates to slow the flood of migrants) The Problem with The UK being like this is that it has the income distribution of a developing country with an under-developed system of redistribution of wealth, but has the cost base of a northern european wealthy country. This is why nurses and teachers wind up eating out of foodbanks. This doesn't really happen elsewhere.

[The Awesome Berbaslug!!!]

people point out that tackling wealth is more important than tackling income and you say that's impossible because the majority of wealth's in property. People point out that's not true . you start saying that making the poor wealthier means letting them buy their own homes. people point out that untrue you come back to the level of income tax.

I said literally no such thing. You should pay more attention to what I write, I didn't say that it's more important, or I didn't say that tackling inequality of wealth is impossible. I'm arguing that it's important to tackle both, and that you do them over differing timescales. Taxing wealth is hard because you're starting from scratch. Tackling income inequality just means making your tax system more progressive by increasing taxes on the upper end of the income distribution (More than the top five percent) , while not approaching welfare spending with the attitude of some outraged victorian like Mr fucking Bumble. You can make progress here relatively quickly, and substantially improve a lot of people's lives. But these issues are only one crucial part of dealing with the UK's problems. I pointed out Ireland as an example of what happens when you focus on this side of things at the expense of everything else. But there is literally no point in moaning about austerity, if you're not concerned about addressing the most important and damaging aspect of it. Complaining about the negative effects of austerity and poverty is simply masturbatory performative bollocks if you're not going to do something serious about inequality of income. People who can put together a manifesto which forgets to deal with the worse excesses of austerity on the welfare system aren't to be taken seriously as actual left wingers, in the way that people here think they are, or would like the Labour party to be.

And the problem with taxing wealth is very real. Taxing it at the point of transfer, be it during transactions, or at the point of inheritance, is a very underwhelming means of taxing it. You need to find a way to turn this into a stable, and meaningful tax stream, rather than occasional windfalls, (which encourages bubbles) and this is where you come slap bang into the problem of 60% of irish wealth for instance is tied up in our houses. In the UK it's 70% of wealth. But an astonishing 50% of that is in the value of land. That last figure is truly extraordinary by the standards of the developed world, outside of microstates. The problem with taxing this is that a hell of a lot of people will put your head on a fucking spike if you try. It takes a long time to get this kind of system up and running, and you will have to fight every single inch of the way.

There are a number of other measures which are all important, that have a long lead time, like creating a coherent europe wide system of business taxation, and tightening up loopholes across the board one at a time takes a long time. But it's already paying a lot of dividends. Anyone who talks about taxing businesses, who doesn't talk primarily about the European dimension and it taking a long time as it works towards a coherent system (Like the creation of the single market) isn't to be taken seriously. Another area is europe wide regulation of banks. No country is adequately able to regulate their own banks. You need common rules, and someone looking over your shoulder to make sure that they are being enforced. This is how you stop a repeat of 2008 where billions were squandered saving banks which had made absurd (but legal) decisions, had inadequate reserves, and made insane loans that went bad in massive numbers. This also requires a european dimension and takes a long time.

My problem is that I consider all of these things to be important. And it was their abysmal failure to address these situations that I hold so vehemently against blairites. The Problem is that I came to Corbyn with a completely open mind, and a lot of hope. Unfortunately in these crucial areas, which I feel to be crucial to anyone who is claiming to be left wing, the current Labour party leadership fall short in all the same ways as New Labour. While being disturbingly comfortable with the idea of leaving the EU, which even in a minor form is a self inflicted wound that is going to look a lot more like our 2008 recession than yours. Though it is going to start out like our 1980's experience.

I think these things are important because I'm 40 years old, and for more than half my life my country has either been sliding steadily and inexorably into bankruptcy, utterly Bankrupt, or slowly recovering from bankruptcy. (1979-1992 and 2008-2015) People in England have literally no idea what this is like. No idea. Nothing that you have experienced since rationing even comes close. It is virtually impossible to do anything positive in these periods and they are nightmarish. I don't go on about this sort of stuff because Jose Mourinho has left man utd. I go on about it because this is really fucking important.

[Snake Plissken]

But... the FBPE lot love him so very much.

[URL]https://twitter.com/GeorginaEWright/status/1100756878500474880[/URL]

[Lang Spoon]

Well that's hardly news. Extension wouldn't only be allowed if there was a referendum or election say.

[Nocturnal Submission]

Yes, I really don't see what's to be gained from an extension for either side.

I still think that there will be some minor guarantees attached to the backstop by the EU and that the ERG and DUP will then, accepting that there is little more to be gained but a lot to lose, vote for May's deal, along with a dozen or so Labour MPs if required.

[Nefertiti2]

To Berbaslug:

Most wealth in the U.K. isn’t tied up in housing . ONS data says about a third - as I posted before. So if you have data that says different please reference it. Thanks

[elguapo4]

Yes, I really don't see what's to be gained from an extension for either side.

I still think that there will be some minor guarantees attached to the backstop by the EU and that the ERG and DUP will then, accepting that there is little more to be gained but a lot to lose, vote for May's deal, along with a dozen or so Labour MPs if required.

I'd be amazed to see the DUP vote for anything, this is the first time that they've been treated like anything other than glorified county councillors and it's gone to their head, they've already proved they're willing to fuck over their own constituents because they can say "who else are you going to vote for?"

[Duncan Gardner]

Agree with El Guapo on the DUP. Short term they'll keep their vote whatever. beyond that they face decline both chronic (ageing/ shrinking base) and acute (threat of disastrous Brexit)