Whilst it may be difficult to get excited about pension relief reform, the story behind the rather tepid topic of Ed Ball’s latest economic debacle makes for some fairly amusing reading. The rebirth of old New Labour programmes (those that had a large hand in creating the current social malaise) and playing politics with the economy while in the same sentence accusing the Conservatives of doing the same means that the potential future Chancellor of the Exchequer is little more than a clown sent out to entertain the spectators during the circus interval. Aren’t we lucky to have this towering statesman holding his equally farcical Government compatriot to account for his management of the public purse?
I don’t wish to appear biased here, it’s just that Labour hold a very dear place in my heart. Labour are unapologetic about their class warfare, anti-economic social justice policies, and general leftist Tom-Foolery. They make no attempt to hide the fact that they will fight the next election by making yet more unaffordable spending pledges, by denigrating and marginalising those that work hard and by diluting society with strong-arm measures to push the Left Agenda through our schools and the media.
Is it a surprise to find Ed Ball’s latest tax and spend proposal totally unworkable, ideologically driven, and flawed on principle? Is it surprising to find that he is merely rehashing a failed policy of the New Labour years, the Future Jobs Fund? Is it surprising to find that he is merely reacting to the almost equal idiocy of the Chancellor and his plans to remove the cap on pension relief for the top earners? No of course not. The surprise, for me at least, is that the public and perhaps more importantly the economics correspondents of the British Press and Broadcast Media, are still putting up with this nonsense. When will we get a government committed to not making us worse off? Never, I would suggest. Market economics, argue against them at your peril, dictate that as long as there is a demand someone will seek to fill it, government is no exception.
So, to Ed’s plan: Tax those that pay the highest taxes more in order to provide a guaranteed job for those who cannot get a job! George Osborne’s reform had a cost of £1 Billion to the treasury, and Ed wants to reverse this so that he can provide 129,000 long-term unemployed with a workplace for 6 months. It may be worth reading Jeremy Warner’s brief analysis over at the Telegraph Online to see in detail what the plans would mean for those affected by the proposed changes. It also makes quick work of the ludicrous nature of the ‘policy’.
A question needs to be answered by Ed Balls:
Where are these government guaranteed jobs going to come from if, as you say, there are already 5 applicants for each vacancy?
While Ed may win brownie points for his sense of social responsibility, it may make more sense for him and his party to really focus on creating the opportunities for prosperity for everyone rather than punishing the majority for their success and preventing the minority from achieving their own. Sensible public (less) spending has to form the basis of any sustainable economic policy.
But before we get too smug about our own sense of economic competence, let us not forget that there are at least two sides to every story. What prompted Ed to propose his new pension reforms was that George Osborne has already reformed the pension tax relief in order that those earning certain quantities can claim relief on their tax returns for pension contributions. Higher rate taxpayers will not have their pension taxrelief limited to 20%. This is a good thing for the economy but because George has forgotten to include everyone else in his enhanced pension relief system it is not good for the image, those amongst us who struggle most to save for the future have been left out. Bah.
A question needs to be answered by George Osborne:
What makes the top-rate tax-payer more deserving of enhanced tax relief?
So if the two largest parties in British politics are unable to formulate coherent, practical and beneficial pension, welfare, and taxation policies, what hope do we have that they can navigate the maze of international finance, diplomacy and military conflict?
This time next year we may all be considering the Mayan Apocalypse to be a missed opportunity.
Happy New Year, may you live in Interesting Times.