Germany exports luxurious gas guzzling cars to the world’s rich. You do not hear many Germans queuing up to complain about the conduct of Mercedes customers, seeking to expose the tax dodges of some who buy luxury cars. Nor are most Germans keen to regulate and tax the high fuel using car industry out of existence in the name of the environment. Germany may be green in some ways, but never in a way which would stop it making so many high fuel burning vehicles.
The UK sells top end flats to the same people, building very expensive flats that would otherwise not exist. We sell the super rich a little bit of London. Many in the UK think this is a disaster. They clamour for higher Stamp duty and Capital Gains to try to tax them out. They talk about other possible controls. In a way the UK product is shrewder than the German. Whereas the German car, once exported, is serviced and maintained in a foreign country, the UK flat stays here and provides UK jobs to furnish, equip and service it. The UK can carry on taxing the flat owner, whilst the overseas country gets to tax the German car.
France sells some expensive processed water to the super rich in the form of wines and perfumes. You do not hear the French complaining that the rich are getting inebriated on French wines, or that the foreign buying means that French people can no longer afford their own Chateau Latour or Yquem. They work hard to package the wine and tell the story of its production in a way geared to maximise the revenue take from the world’s super rich for the “finest” wines available.
The Uk specialises in private banking and financial services for those same super rich. The air is thick with complaints about the charges and practices of parts of the banking and financial service industry. The UK is quick to condemn and keen to tax and regulate one of its best money earners. Do too much and the rich will be off to Switzerland or Hong Kong for those services. All main political parties want to change the balance between financial services and the rest. Germany does not have a policy of reducing its dependence on auto manufacture.
I am all in favour of us broadening the range of products and services we can sell abroad. It makes sense to do so. What does not make sense is to be so critical of the ways we currently have of earning overseas revenue, before we have found better ways of paying the bills. Maybe part of the answer to help pay for all the imports is to export more financial and banking services, and sell more top end flats. Otherwise we have to carry on selling off the assets we already own, as we have had to do in recent years given the large balance of payments deficit. One of the hard truths of lfie that socialists do not like is you have to sell more to the rich, as they have the money to employ people.