Spreading wealth more widely

There are two ways of reducing equality. There is the socialist way, which is to tax the rich until enough of them leave the country or make less money owing to disincentives, or simply have less money thanks to the tax. That will cut inequality by removing the richest, but may make everyone else poorer as it takes away the demand for services and assets that the rich provided.

There is then the Conservative way, which is to find ways to help people into better paid jobs and to assist them become owners and savers. Taking tax down is one of the  best ways the state can help with this.

I have always regarded the elimination of poverty as a more important aim than the reduction of inequality, given that it does also reduce inequality anyway. Reducing inequality by driving away all the billionaires does not do much to raise overall  happiness whereas getting hundreds of thousands or millions more people into well paid jobs from low paid jobs or into work from unemployment is a big win.

There are those who think the imbalance in wealth between old and young is unacceptable. They should understand that is always likely to be the case that the older people own most of the wealth as they have had a lifetime of working, earning, building businesses, buying homes to accumulate their wealth and increase their income. Most of us starting out with no wealth and little income take time to get to a better  paid job and to owning  a home and repaying the mortgage. What government needs to do is to make sure it eases the way for the young to accumulate, save and invest.

I want to see thus new government back an ownership revolution, finding more ways to promote home ownership, share ownership, small business ownership and the rest.

This entry was posted in Uncategorized. Bookmark the permalink. Both comments and trackbacks are currently closed.

140 Comments

  1. formula57
    Posted January 11, 2020 at 5:30 am | Permalink

    Agreed, although macro-economic changes affecting the labour market and asset price inflation driven by monetary policy (QE) mean that generation Y and younger face a much tougher struggle than did the preceding few generations.

    (Should the end of the first sentence read “inequality” perhaps?”)

    • Martin in Cardiff
      Posted January 11, 2020 at 8:18 am | Permalink

      Reality consists of infinitely more scenarios than the two caricatures which John contrasts.

      But for people who live in a world of cartoon-like simplicity, they can relate to what he says, and so it’s effective.

      And that’s why he does it, I think.

      If people are desperate, then they will do any work, for anyone, and at any rate. So from where will these “well paid” jobs appear in a deregulation-fixated Tory UK?

      No, it would just be a yet faster race to the bottom, with the rich getting richer and the poor getting poorer.

  2. Stephen Priest
    Posted January 11, 2020 at 7:08 am | Permalink

    home ownership
    share ownership
    small business ownership

    Labour prefers State Ownership of everything.

    Most people in the country believe in and at least aspire to home ownership, share ownership, small business ownership.

    This explains why since Harold Wilson left office Labour has had 8 leaders and only one, Tony Blair, has won general elections. 3 Conservative leaders won general elections in the 2010s alone.

    • Martin in Cardiff
      Posted January 11, 2020 at 8:27 am | Permalink

      No, Labour vigorously defends the Human Right of every person to The Peaceful Enjoyment Of Possessions – and the rest – which is inconsistent with your smear.

      On the other hand, Labour does, however, also defend mutually and community-owned property, such as parks, village greens, other council property, co-operative ventures, mutual societies etc. from private power, which seeks to dispossess the ordinary people of it for its own gain.

      • Stephen Priest
        Posted January 11, 2020 at 1:56 pm | Permalink

        That sounds like a speech by Rebecca Long Whatshername

      • Edward2
        Posted January 11, 2020 at 2:05 pm | Permalink

        Not in the last Labour manifesto which called for the State to re nationalise some companies by forcing shareholders to sell their shares and take a government bond .
        Sequestration by the state plain and simple.

        • jerry
          Posted January 11, 2020 at 3:31 pm | Permalink

          @Edward2; Oh you mean like the Tories (post 1979) forced the State to sell off certain sectors, and put others out to competitive tender, that had never been in the private sector – certainly not in the 20th Century. The right-wing needs to be a little careful when it comes to state ownership and shouting off, glasshouses and all that…

          • Edward2
            Posted January 12, 2020 at 12:45 am | Permalink

            Bit different to a government spreading share ownership and gaining much needed extra revenues by offering state owned industries for sale to the public to Marxist Cirbyn stealing those legally held share back off their legitimate owners without compensation.

          • jerry
            Posted January 12, 2020 at 7:55 am | Permalink

            @Edward2; So it’s OK in your view for a govt to ‘steal’ the assets from the State (the people) but not for a govt to ‘steal’ the assets from private shareholders. My argument is both are wrong!

            You seem to be in favour of short term gains for the State rather than longer term on-going returns being available for the Govt to reinvestment in that industry or some place else.

            We need a claim, non-partisan debate about private vs public, not just the usual rhetoric thanks, yes shareholders should be properly compensated for any enforced nationalisation, but equally should any state owned entity be sold off it should be offered to the market at its true value, not at a fire-sale IPO – if the value of the shares jumps significantly after the IPO then someone has undervalued the assets!

          • Edward2
            Posted January 12, 2020 at 10:59 am | Permalink

            The firced removal of legally bought shares in a public company listed on the stock exchange by a government without compensation to the legitimate owners of those shares is theft.
            Plain and simple.

            The State decided to sell off assets it owned in return for cash.
            That is a legitimate and legal transaction.

            You can argue if you want to, that decision was wrong and that the assets would have been better left owned by the State or that the offer price was wrong but that is a rather different argument to the one I originally raised to Martin.

          • jerry
            Posted January 12, 2020 at 2:18 pm | Permalink

            @Edward2; Both nationalisation & privatisation are legitimate and legal transactions!

            Parliament makes the law, legality is thus a moot point, a govt deciding to nationalise (with or without compensation) was and still is just as legal as a Govt deciding to sell a State owned asset (at a discount or not). That is why I placed the word theft between punctuation mark, legally it was/is not theft.

            PS, the only nationalisations were no compensation was paid were when the shares were already in effect worthless, due to pending or actual bankruptcy.

          • Edward2
            Posted January 12, 2020 at 8:43 pm | Permalink

            Yeah, whatever Jerry
            When you have a bee in your bonnet no logical argument is sufficient for you.
            You win.
            Hope that’s OK for you.

          • jerry
            Posted January 13, 2020 at 8:09 am | Permalink

            @Edward2; Oh do look in the mirror!

            It is you who always fails to have any logical argument, because for you it is always a political argument, not the more nuanced moral argument, and no amount of logical thinking is going to displace the formers dogma.

            You called nationalisation ‘theft’, but a Marxist would call shareholder dividends ‘theft’ (from those who actually create the wealth, those on the factory floor, so to speak), that is why those great moralist of the 1800s set up cooperatives and the like, as a half way house, and perhaps why in the 1980s many acts of privatisation awarded shares to those who worked in the industry.

            The problem with nationalisation, here in the UK, is political, not economic, just compare the fates of British Leyland and the French Renault, both were basket cases in the late 1970s…

          • Edward2
            Posted January 13, 2020 at 1:24 pm | Permalink

            I called nationalisation without compensation theft.
            Get your facts right Jerry.

        • Martin in Cardiff
          Posted January 11, 2020 at 4:10 pm | Permalink

          “Some, you say”.

          I was replying to the poster, who said “everything”.

          Learn to read.

      • nhsgp
        Posted January 11, 2020 at 5:50 pm | Permalink

        Where, for example, do people have the right of consent?
        For example, to say no to the state pension and instead invest their wealth for their old age?
        Ah yes, consent isn’t allowed. It’s not even a human right.
        Why would the right of informed explicit consent be not deemed important by politicians?

      • anon
        Posted January 11, 2020 at 9:21 pm | Permalink

        MIC,

        LibLabCon.

        – Residential Leasehold still exists.

        – BBC still exists.

        – We are still paying Billions to the EU! on and off the books

        – the rich & powerful get bailed out or given sinecures in the HOL or UN or Quangos. The poor are kept dependent via means testing, the middle well they just lump it. The millionaires think they are hard done by.
        Meanwhile we have the favoured spend of 100’s of billions on foreign aid to the EU and rich countries.

        Meanwhile an ally literally burns and we send a message. How about helicopters,ships, planes, military logistics and fire crew?

        Also with HS2 and uncosted nuclear build and other follies

        It would be cheaper to install solar, wind onshore where we as a country and individually could be become less dependent and wealthy as a country.

        Obviously dependency & control is what they want.

        Its all sewn up.

        Reform? maybe maybe not.

    • jerry
      Posted January 11, 2020 at 8:38 am | Permalink

      @Stephen Priest; Funny how some always compare chalk with cheese in an attempt to prove their arguments…

      Compare the Tory Governments from 1951-64 with those from 1970-74, 1979-97 & 2010-20, compare past Labour Governments similarly. Which ones did more to reduce inequality, reduce (relative or actual) poverty?

      I would suggest that Wilson was far more successful than Blair, and the three term Tory govt of Churchill, Eden, Macmillan & Home was more successful than any period of Tory govt since!

      Thus the real argument, beyond a GE, is not between dissimilar political ideologies but the differing ideas within which ever ideology is in govt.

    • Lifelogic
      Posted January 11, 2020 at 8:44 am | Permalink

      Well yet but the resent Conservative leaders were daft, pro EU, tax borrow and piss down the drain socialists anyway – with the (only partial) exception of Thatcher. Who (despite making many avoidable errors like John ERM Major) was the most successful by far at the ballot box and on the economy.

      • Lifelogic
        Posted January 11, 2020 at 5:28 pm | Permalink

        Well yes but the recent …. I meant sorry.

    • Anonymous
      Posted January 11, 2020 at 10:41 am | Permalink

      “Labour prefers State Ownership of everything.”

      So does the Tory party.

      • Lifelogic
        Posted January 11, 2020 at 3:09 pm | Permalink

        It seem so.

  3. Stred
    Posted January 11, 2020 at 7:19 am | Permalink

    Socialist Sweden has abolished Inheritance Tax. The UK keeps it at 40%.
    High tax France reduces Capital Gains Tax to zero for long term capital gains. The UK has abolished relief for inflation on capital gains and charges 28% on unreal gains.
    The UK is a high tax country and has instructed its tax ministry to maximise tax take instead of pax the right tax.
    The tax maximizers have their eye on the capital gains of 2 million small landlords who have invested in housing and may have made a gain of £500k to a million over a long term. By making life difficult or impossible and forcing sale, the tac take on unreal gains could be over £280 billion.
    This would be useful to build HS2 or spend on new northern Tory voters.

    • Ian Wragg
      Posted January 11, 2020 at 8:26 am | Permalink

      The highest taxes in history and John rubbishes socialist policies.
      For this high taxation we have soaring crime. Decimated armed forces and the lowest pension in the G7.
      Plenty of money for the EU, HS2 and Foreign Aid.
      Priorities my dear boy.

      • Lifelogic
        Posted January 11, 2020 at 5:42 pm | Permalink

        Indeed the highest taxes for 50 years yet appalling and still declining public services. The longest waiting times ever in the NHS, police who seem to have largely given up on most crimes, aircraft carriers with no aircraft, more and more damaging red tape. Millions put in £50K of student debt plus 6% interest for often worthless degrees, over expensive intermittent energy the disasters go on and on.

        More and more parasitic non jobs and fewer and fewer people doing anything productive and useful.

    • Martin in Cardiff
      Posted January 11, 2020 at 8:44 am | Permalink

      Thank you for the pointer to these two interesting and highly logical moves by France and by Sweden, about which I have now read.

      The only problem that I see with abolishing IHT in the UK would be that we would be starting from a position of far more concentrated wealth than did the Swedes, and further analysis would be needed.

      France’s moves on CGT make complete sense as far as I can see, and would end an obvious injustice for property owners here too.

    • Lifelogic
      Posted January 11, 2020 at 8:52 am | Permalink

      Indeed taxes in the UK are absurdly high many are way over the Laffer point. They should (for maximum good) be far lower than the Laffer point. A big sign from HMRC saying do not come and live are invest here if you are rich and hard working.

      Singapore is about twice as rich per head as the UK (PPP) mainly because the government spends only about 15% of GDP whereas in the UK they spend (largely waste) nearly 50%.

    • Lifelogic
      Posted January 11, 2020 at 8:57 am | Permalink

      40% IHT over just £325K is hugely out of line with sensible countries. In the US the rates is far, far lower and only starts over about a $11.4 million threshold – most sensible countries have non or virtually none.

      • hefner
        Posted January 14, 2020 at 8:48 pm | Permalink

        Does 4% of the population not register as virtually none? Or as often, are you making ‘un fromage’ of it because it could hurt you?

    • agricola
      Posted January 11, 2020 at 10:17 am | Permalink

      True, there are many forms of socialism, like potatoes, everything from Christianity to Pol Pot. Many look more like imperialism and unlike potatoes are indigestible. The Swedish system is acceptable to the Swedes and successful. Most versions in the UK have been a total failure even though they have contained aspects that many of us have gone on to accept. Conservatives must remember that they did not win our recent election, Labour lost it, because more than any party they failed to appeal to the electorate. That same electorate, as an act of faith, more than absolute conviction, turned to the conservatives. I think Boris realises it is up to him to confirm their faith.

      In the rest you are right. The BoE, the Treasury, political thinking in the three main parties is totally out of line with the aspirational thinking of most of the population. This does not mean our population are greedy and uncaring, witness the enormous contributions they make to charity. It just means the establishment for want of a better word does not understand them or even try to.

    • Andy
      Posted January 11, 2020 at 11:15 am | Permalink

      Not quite right. The UK inheritance tax is at 40% over a couple threshold now at almost £1m. This means almost nobody in the UK pays inheritence tax except the 4% with the largest assets.

      • Alan Jutson
        Posted January 11, 2020 at 2:33 pm | Permalink

        Andy

        Not quite right as I understand it.
        Firstly it depends upon the fist death not using any of their nil rate band, so that it can then pass automatically onto the second death (assuming marriage) secondly the part value house exemption only applies if you leave it to your direct sons and daughters.
        It does not apply if you want to leave your property to someone else.

        All those not owning property only get the £325,000 nil rate band plus any part of first Nil rate band not used on first death (For married Couples).

        Single people only get £325,000 which has not been index linked for more than 10 years now.

        Afraid IHT needs a rethink so that it is fair to all, and taking the value of the Primary residence/family home out of the equation seems like a more sensible idea. along with index linking the Tax free allowance, which by now should be £500,000 per person at least.

        • Peter Parsons
          Posted January 11, 2020 at 11:53 pm | Permalink

          Andy is correct. The figures show that only 4% of estates pay inheritance tax under the current rules. 96% pay absolutely nothing.

          • Edward2
            Posted January 12, 2020 at 9:44 am | Permalink

            Alan was questioning the claim that there is already a £1 million inheritance tax allowance.

          • Peter Parsons
            Posted January 12, 2020 at 9:28 pm | Permalink

            Andy didn’t claim there was a £1 million threshold, he stated almost £1 million for couples which, given the threshold tops out at £475,000 per person, so £950,000 per couple (if the total estate is below £2 million) is statement I would consider fair and reasonable.

          • Edward2
            Posted January 13, 2020 at 8:05 am | Permalink

            He said “a couple threshold now almost a million”
            As Alan showed that is only in rare circumstances.
            You posted about the percentage of estates that pay inheritance tax.

        • Peter Parsons
          Posted January 13, 2020 at 10:56 am | Permalink

          Yes. Alan argued for IHT to be “fair and reasonable”. A system whereby 96% pay nothing may be considered to be one that is just that.

    • Posted January 11, 2020 at 12:35 pm | Permalink

      Quite so, and in addition Govt have made it impossible to save money in a bank. Deduct tax and inflation and you show a loss each year. By not allowing law abiding people to hold bank accounts, they have created ‘banks’ in british property – hence the empty blocks of flats all over London.
      Let’s get honest money and substantially reduce tax on individuals and small businesses NOW!

  4. agricola
    Posted January 11, 2020 at 7:28 am | Permalink

    If you really believe what you write in para one and two, as a Conservative you have been remarkably lacking in influence in your party. The conservative party, while in shared or lone power have through tax ensured that the individual has less of his earned wealth during his lifetime and less to hand to his heirs than in most of the really successful economies worldwide.

    You have been weak historically in encouraging the native talent of the people by destroying the Direct Grant Scheme and the majority of Grammar Schools. Any party wishing to promote equality of opportunity would be expanding both and encouraging technical colleges for those wishing life to progress on a less academic route.

    Margaret Thatcher encouraged home ownership, since whom there has been little incentive or means. I accept that it is a route to modest wealth, but only due to it’s house scarcity. No political party has done anything for savers because it suits their propensity to spend to have saving rates below the rate of inflation.

    The elimination of poverty is laudable, but whatever government has done has not stopped the increase in food banks and street sleeping. I acknowledge you have reduced unemployment, but the key to what you want to do is better education and as above a tax environment in which more job opportunities are created. Billionaires are irrelevant. Most of their wealth will be in tax havens including their port of convenience yachts. They could not exist legally, subject to the UK tax regime unless HMRC are still doing sweetheart deals.

    Your last paragraph I agree with, but await the signs of the vision that will allow it to happen. Please give it impetus.

    • SM
      Posted January 11, 2020 at 8:03 am | Permalink

      Agricola – over the years, many of us in the Conservative Party have been saddened by the fact that our host has been overlooked in the appointment of Chancellors by successive PMs.

      • agricola
        Posted January 11, 2020 at 2:24 pm | Permalink

        Yes in terms of being in the forefront of government he is an unfulfilled talent. Maybe he is seen as being just too clever by some. We Brits have a habit of denying talent lest it draws attention from lesser mortals around that level of ability.. Enoch Powel had much the same problem and was eventually deliberately misunderstood to engineer his downfall. From where I sit it is an impossible judgement to make because he is only known through this diary and his work in Parliament. It does seem a waste but were he to be elevated it would bring an end to this diary.

    • Sir Joe Soap
      Posted January 11, 2020 at 8:34 am | Permalink

      Largely true.
      The belief used to be (mid seventies to mid nineties) that reducing unemployment, would increase equality.
      Blair used universities to accelerate reduction of unemployment, but that threw up financial problems for students whose courses mismatched job vacancies and landed them with huge debts.
      So now the circle has been squared, with personal debts and poor infrastructure caused by the quick fixes of governments in the past.

      There has to be a realisation that training which lands you up as a barrista actually does the square of no good for the long term good of the country or the self. People need training for jobs where there IS a demand, be the courses a bit tougher or in some cases more practical than those of the past.

    • Stred
      Posted January 11, 2020 at 9:04 am | Permalink

      Successive Tory governments have supported big business at the expense of small entrepreneurs. They have followed EU policy and the latest tax and regulatory policies are the least likely to encourage job creation and investment. They do the opposite. Does Johnson understand this? His family has made its money through journalism and political appointments..

    • Lifelogic
      Posted January 11, 2020 at 10:04 am | Permalink

      Well if you give valuable things away for free (or less than real value) you are likely to get a demand. Some will go doubtless go to the food banks and then keep the money back perhaps to buy vodka, tobacco, to pay a loan back or for the kids shoes. I am all freedom of choice.

      Same with the NHS. If you give something alway for free then you have to ration it by delays, waiting lists, making it inconvenient to book, long waiting times or similar back door inconveniencing methods.

      • agricola
        Posted January 11, 2020 at 4:09 pm | Permalink

        Lets be honest about the NHS, it is not for free. In general it is paid for via taxation with the exception that the majority pay for their prescription, dental work and eyesight correction.

        From personal experience you can get an emergency GP appointment if you are ill. Routine GP appointments or practise nurse appointments take too long. A&E gets overloaded for a variety of reasons. Patients becoming impatient with the GP service, becoming drunk and literally incapable, drug overdoses, plus having an array of genuine accidents most prevalent in winter.

        Certain specialities in medicine do not have enough specialists and staff to meet the workload. The answer to this is to train more and not to burden them with horrendous tuition fees. There is a limit to how many you can poach from third world countries.

        I have never experienced delays because health workers deliberately introduce systems to block patients , though some systems are not always user friendly especially for those who are committed to work or are elderly and not computer savvy.

    • forthurst
      Posted January 11, 2020 at 10:21 am | Permalink

      “In 2016-17, the proportion of home owners under 35 was 9%; two decades ago, this figure was 18%.
      Mortgagors spend a smaller proportion of their income on housing costs than do those in other tenures.” English Housing Survey Home ownership, 2016-17

      When will the government start reading their own stats and acting on them ie stopping mass immigration and deprecating landlordism? Mass immigration means the government is constantly aiming at a moving target; landlordism does not increase the availability of housing: it inflates house prices and drives more people into renting.

    • Anonymous
      Posted January 11, 2020 at 10:37 am | Permalink

      +1

  5. Gord
    Posted January 11, 2020 at 7:48 am | Permalink

    The poor will always be with us. With respects, one might add, especially whilst we measure poverty in relative rather than in absolute terms.

    • Ian Wragg
      Posted January 11, 2020 at 8:31 am | Permalink

      If we measured in absolute terms half the public sector and charitable sector would be unemployed.
      Can’t have that can we.

    • Lifelogic
      Posted January 11, 2020 at 9:12 am | Permalink

      Clearly we should abandon any relative poverty measures. If you have somewhere warm to sleep, enough to eat, education and healthcare you far richer than billions of people worldwide. I was fairly poor when young, we had no central heating, no phone or tv initially (nor did many of our friends and neighbours have them). I was one of four children and without quite enough to eat sometimes too. But it was a very happy childhood indeed. There was always a football to kick about, a cricket bat, good friends, my guitar or the beach and fishing.

      Real problem come from alcoholic, drug addicted, sick or incapable parents in the main.

    • agricola
      Posted January 11, 2020 at 9:52 am | Permalink

      Absolutely true, I have seen real poverty around the World which makes our level of poverty something to aspire to for the worlds really poor. Places where children are deliberately maimed so that they can beg more effectively. I would like to see an end to our relatively poor via the dignified ladder of employment. I would also like to see those truly disadvantaged physically and mentally much better cared for. That is what I would deem to be caring conservatism.

    • James1
      Posted January 11, 2020 at 10:48 am | Permalink

      O/t If we are going to continue spending umpteen billions in foreign aid, how about immediately directing a goodly proportion of it towards helping the Australians with capital equipment and manpower, to fight the extensive bushfires that are engulfing a number of their towns

      • agricola
        Posted January 11, 2020 at 5:56 pm | Permalink

        Yes, this needs to be acted upon as a matter of moral urgency.

    • BJC
      Posted January 11, 2020 at 11:36 am | Permalink

      Gord: Indeed, government uses some very strange measures. Another one is the emphasis on NHS waiting times, a measure of easily achieved failure, not the level of productivity they’ve achieved with available resources.

  6. jerry
    Posted January 11, 2020 at 7:58 am | Permalink

    Note sure why you think property or share ownership promotes equality, there are many poor home owners, just as there are many poor ‘paper millionaires’, they might well have assets but do not have two actual spare farthings to rub together. What is more the value of those assets can vanish all to quickly should the respective markets that fix their values take a downward turn, over night homes worth less than the outstanding mortgage, shares not worth the paper they are written on.

    Nor is it a reliable retirement plan, how many pension funds have black holes due to the paper value of their assets not matching the funds known or expected future real world commitments.

    It seems to me that the magic money tree is alive and well, despite all the rumours that it had withered and died back in 2008…

    As John Major once said, in a different context admittedly, we need a return Back to Basics.

  7. Posted January 11, 2020 at 8:09 am | Permalink

    The old will always be richer than the young but boomers have particularly lucrative pension arrangements that the young have no prospect of. That and the high house prices due largely to excessive immigration are the main causes of intergenerational resentment.

    • Martin in Cardiff
      Posted January 11, 2020 at 2:01 pm | Permalink

      If immigration were the cause of high house prices, then why did they fall sharply between 2008 and 2011, while the population was steadily growing just as ever?

      • Edward2
        Posted January 11, 2020 at 4:12 pm | Permalink

        Every graph has a blip.
        Look at the trend from 1997 when Blair got us to over 300,000 new arrivals a year.
        A city the size of Southampton was needed to be built every year to cope.
        But it wasn’t.

      • Posted January 11, 2020 at 5:31 pm | Permalink

        Prices are not affected by only one factor. There was a global recession at that point.

        • Martin in Cardiff
          Posted January 12, 2020 at 10:06 am | Permalink

          Correct.

          Demand is just one, and the biggest component of demand comes not from immigration, but from divorce, at which the UK tops the league in Europe, I read.

          Availability of credit, and general market confidence are large factors too. That is why we have streets of houses for a pound each in some places.

          • Edward2
            Posted January 12, 2020 at 11:04 am | Permalink

            You use the £1 house argument a lot Martin.
            If you did research you would find they come with a number of catches.
            Nice to see lots of homes for sale in good condition near you for well under £100,000.
            PS
            Divorce is a factor as is the rise in single occupancy but compared to the rise in population caused by immigration since 1997 it isn’t the main driver.

          • Martin in Cardiff
            Posted January 12, 2020 at 2:17 pm | Permalink

            No, it is not the “main” driver.

            There are a number of slices to the demand pie, and none of them is more than half.

            However, on the one that I’m using, divorce is a bigger one than net migration.

            Don’t forget, that where there are children, both homes need to be capable of housing them.

            According to HoC library:

            “Clearly, population growth has a key part to play in driving demand, but the number of households being formed has outstripped population growth for decades: between 1971 and 2008, the number of households in Great Britain rose by 34 per cent, while over the same period the population increased by only 10 per cent.32”

            It goes on to say that about 28% of new household formation at present is down to migration.

            Hope this helps.

          • Fred H
            Posted January 12, 2020 at 8:23 pm | Permalink

            Marty – ‘Don’t forget, that where there are children, both homes need to be capable of housing them.’
            Says who?
            From a Letting agency experience point of view it is highly unusual for a separated/divorced father to seek a place with more than 2 bedrooms – no extra room for offspring to do homework/play etc. Mostly finance is the driver, the father generally being far worse off. Often with children of both sexes the second bedroom is used by only one sex at a time, so the children get separated on visiting/staying for a weekend etc.

          • Edward2
            Posted January 12, 2020 at 8:47 pm | Permalink

            Divorce is a small driver.
            Check the data.
            Are you saying the rise in house prices is due to divorce rather than 7 million extra people?
            And I note you are going from 1971 when immigration numbers only really happened post 1997.
            Clever misuse of statistics.
            But it fails.

  8. Lifelogic
    Posted January 11, 2020 at 8:17 am | Permalink

    I too have always regarded the elimination of poverty as a more important aim than the reduction of inequality. So long as someone as enough to eat, somewhere to sleep, is healthy and has education and healthcare they are richer than most people in the world. You can never reduce inequality much. Even if you give everyone £1000 each today by the end of the year some with have nothing and others will have turned it into £10,000.

    The one think every sensible MP should realise is the government spend money far far less efficiently than government. From the current highest and most complex tax position for 50 years this is even more true than usual. Cut taxes, cut the vast government waste, cut the red tape, go for easy hire and fire, get some real effective fair competition in banking so HSBC/Lloyds and similar can not get always with charging 200 times more for overdrafts than they pay on deposits.

    • Lifelogic
      Posted January 11, 2020 at 9:46 am | Permalink

      I meant – The one thing every sensible MP should realise is the governments spend money far, far less efficiently than individuals and businesses do (on average).

  9. Lifelogic
    Posted January 11, 2020 at 8:27 am | Permalink

    As another example the government’s totally idiotic, expensive, intermittent, so called “renewable” energy policy clearly exports many energy intensive jobs abroad. Probably making thing less efficient overall, and not even saving any C02 output. Most likely increasing it in fact, after all the transport costs are considered.

    We are clearly governed by fools – Major, Brown, Darling, Osborne and Hammond have all be dire, economically illiterate, Chancellors. This has lead to the current, hugely over taxed and regulated position that has done such vast harm to economic output and growth.

    • Lifelogic
      Posted January 11, 2020 at 8:39 am | Permalink

      On Javid we shall soon see, but so far I do not see many signs that he is not, yet another, tax borrow and piss down the drain Chancellor. We shall see on 11th March. He could, however, do a lot of good now by showing some low tax, pro business, pro growth vision and a direction of travel. But nothing so far from him in that direction rather the reverse.

      He has not even commented on HSBC’s 40% personal overdraft rates or nearly double that at Lloyds and the clear lack of real competition here. This is seems is even driven by the FCA regulator whose boss he has just appointed to head up the BoE.

      • miami.mode
        Posted January 11, 2020 at 5:23 pm | Permalink

        My latest credit card bill shows a minimum of £15 and if paid by the due date the interest will be £17.21.

        This is designed to keep the poorest in penury and should not be allowed. The minimum payment should always be sufficient so that the debt reduces.

      • hefner
        Posted January 13, 2020 at 4:06 pm | Permalink

        I checked your statement and I am very doubtful how you arrange your finances! I can get a £50k loan over 3 years at 6.7% from First Direct (HSBC). While I have been with them since the bank opened this internet subsidiary, I do not think I am a particularly special customer. So what little story do you keep on telling us? Are you unable to see the difference between an overdraft and a loan? Are you in the business of buying properties using overdrafts? If that’s so that’s the best joke I have heard for some years, but given what seems to be your grasp of most things scientific, I should not be surprised.

  10. Javelin
    Posted January 11, 2020 at 8:49 am | Permalink

    A very important but off topic.

    The Iranian military have proven themselves utterly incompetent at using missiles so there is a moral duty to stop them acquiring nuclear weapons by any means. The Iranians have no grounds to complain.

    • glen cullen
      Posted January 11, 2020 at 3:37 pm | Permalink

      They are only utterly incompetent at using missiles if the missile battery command didn’t map the flight routes of international commercial aircraft i.e safe flight zone, if the senior missile operator couldn’t interrogate the aircraft by radar or by transmitted single or by radio, if the missile team didn’t understand the rules of engagement i.e hostile or friendly, and only if the trigger-man wasn’t given permission to fire or set the system to fully auto. And if the system was set on fully auto there are still restrictions on targeting so that you don’t hit your own aircraft

      They knew what they where doing, they’ve sent a clear message; we have a capable air defence missile system so USA keep out

      • APL
        Posted January 12, 2020 at 2:32 pm | Permalink

        glen cullen: “They knew what they where doing, they’ve sent a clear message; we have a capable air defence missile system so USA keep out”

        That sounds insane. Iran shot down the wrong plane, not even a military aircraft, and in your book, that’s a capable air defence system.

        A civilian aircraft by the way, carries no countermeasures, is not particularly agile, and thus a pretty easy target.

        Being able to shoot one down is no measure of a countries air defence capabilities.

        • glen cullen
          Posted January 12, 2020 at 9:31 pm | Permalink

          There’s a difference between tactical and strategic capability, buying and been able to use the latest air defence missile system on any discriminate target is in itself sending a strong message….ie don’t enter or mess with our airspace

          • APL
            Posted January 13, 2020 at 7:28 am | Permalink

            “ie don’t enter or mess with our airspace”

            I disagree. The message it sends is that, Iran doesn’t have a technically proficient professional military. Rather, either technically illiterate or filled with religious fervour, but certainly not very disciplined.

  11. Posted January 11, 2020 at 8:50 am | Permalink

    I agree totally. However promote all that ownership so it is available to tax it like dividends, refuse to acknowledge dementia as an illness so people who gave been prudent have to pay whilst the imprudent/less fortunate in the next bed get it free, similarly with care homes.

    12/15 billion in Overseas Aid? Billions wasted in the public sector over the years. ‘Lied’ to re Inheritance Tax. No incentive, no democracy.

    Let’s see if the Chancellors first budget reverses this trend. Then I will start to believe you.

  12. Fred H
    Posted January 11, 2020 at 8:51 am | Permalink

    ‘Working poor’ should not exist in a modern democracy like UK. Reasons why it does? Well starting with poor skills the pay rate is minimum wage (or less if devious employers get away with it). Another problem is should the worker live in a place and circumstances that would not allow poverty, taxing by means of income tax(absurd) and high VAT forces it. Yet another is the cost of a home (normally rented of course) and may well be cost of transport to the employment.
    So Sir John, I look forward to a Conservative government, and a PM and Chancellor who will take steps to reduce the social disgrace of the UK having working poor.

  13. Kevin
    Posted January 11, 2020 at 8:51 am | Permalink

    “small business ownership”

    Unfortunately, in spite of the People’s Vote, and because of the Conservative Party’s actions, we still have to consider the EU dimension to changes in Government policy. It is worth always reminding ourselves: Clause 77 of the Political Declaration states that the parties – in the areas of state aid, competition, social and employment standards, environment, climate change, and relevant tax matters – should uphold the common standards applicable in the EU and UK at the end of the transition period (during which, because of the Conservatives’ Withdrawal Agreement, the EU will have legislative power over us). This clause additionally states that the parties should rely on exclusively EU standards.

    • Stred
      Posted January 12, 2020 at 1:11 am | Permalink

      Keep it coming Kevin.

    • Martin in Cardiff
      Posted January 12, 2020 at 10:12 am | Permalink

      Yes, it’s exactly as Nick Clegg, no other, explained to Farage in the first TV debate that it would inevitably be in the event of a Leave win.

  14. Alan Jutson
    Posted January 11, 2020 at 8:59 am | Permalink

    I suppose the whole question revolves around the definition of wealth and poverty.

    One thing is certain, the Government has no funds of its own, it only has what it takes from its citizens, or that which it borrows in their name.

    The record of Government spending and getting value for it is abysmal.

    When People spend their own money, most of them tend to get better value for it.

    Surely the job of government apart from keeping us all safe, is to encourage everyone to do the best they can, by promoting equal opportunity.

    Satisfaction in life is not always money related.

  15. Peter
    Posted January 11, 2020 at 9:17 am | Permalink

    “Taking tax down is one of the best ways the state can help with this.”

    Yet removing punitive Inheritance Tax does not appear to be on the Conservative Agenda.

    • Peter Parsons
      Posted January 12, 2020 at 12:03 am | Permalink

      96% of all estates have an inheritance tax bill of £0 today.

      That doesn’t look very punitive for the 96%.

      • Fred H
        Posted January 12, 2020 at 8:18 am | Permalink

        PP – -you ignore those taking steps to avoid Inheritance tax.

  16. Mark B
    Posted January 11, 2020 at 9:19 am | Permalink

    Good morning.

    There is the socialist way, which is to tax . . .

    And this Conservative (sic) government has never raised or created new taxes ?

    The terms poverty and inequality are relative terms. I may be poorer than the Queen and the equality just as great but, I may be considered far richer than some and the inequality between us just as great.

    I believe the reason these relative terms are used is because they can never be successfully resolved. And that is ideal for the politicians and the State as it can use both terms to meddle in our lives.

    A better measure would be opportunity. Why can’t children have the opportunity to attend university or better education if their academic ability allows them ? If a child shows signs of being a polymath why should he or she be held back due to their background and circumstances ? Here I have no problem with the State providing funding for their education. They will, overtime, replay the State.

  17. Frankh
    Posted January 11, 2020 at 9:28 am | Permalink

    When I read this I can only see Crocodile tears

  18. Dave Andrews
    Posted January 11, 2020 at 9:35 am | Permalink

    If socialism achieves its aim, presumably they will run out of sources of money to fund their borrowing.

  19. Everhopeful
    Posted January 11, 2020 at 9:42 am | Permalink

    Unless we are talking about gambling away the family fortune then it is usually the case that governments cause poverty. ( Enclosure,war,tax,encouraging debt, stealing pensions, destroying the family unit, imposing “fairness” and “equality”,changing rules, closing down jobs, overcrowding a country, manipulating the currency, making people pay for govt. mistakes etc etc.).
    And even then the legalising of gambling ( by govts) implicates them. Governments also normalise gambling by benign-seeming lotteries.
    And then to “rectify” their policies govts take from others (via increased taxes) to help those they have impoverished or deracinated thus making everyone poorer.
    Surely the greater villain??

  20. Bob
    Posted January 11, 2020 at 9:47 am | Permalink

    The nanny state is infantilising the population.
    Excessive and overly complex taxation and regulation is stifling economic activity.

    When it comes to government, sometimes less is more, so desist with the constant drive to interfere in peoples lives and let them decide for themselves whether they want to strive hard to succeed or just coast through life. The bloated state needs pruning back.

  21. Cortona
    Posted January 11, 2020 at 9:55 am | Permalink

    Looking at ageing demographics and spiralling debt levels in the West I’m becoming convinced the only way to boost growth is tax cuts. As we know government spending on HS2 is inefficient and has a limited multiplier. Individual spending would have a much more positive impact as we know how to manage our own money better, a principal at the heart of free markets.
    Unfortunately the centre has been dragged so far to the Left and our media is so shrill on ‘inequality’ that I can’t see how any government can deliver meaningful tax cuts without an uncomfortable outcry leaving us mired in low growth for decades.
    That said I feel this election is a unique opportunity to ignore the Guardianista & BBC narrative so roundly rejected by voters and do the right things now early in the five year cycle.

  22. BCL
    Posted January 11, 2020 at 10:04 am | Permalink

    I think the gap between rich and poor is completely irrelevant. Messrs Branson and Dyson and considerably more wealthy than I but I don’t mind. In fact, I’m pleased there are such people who can spend vast sums on innovation, and who chose to do good and worthy things with their wealth. What is important to me is whether I can meet my commitments comfortably. I’m pleased to say I can. Robbing the rich to give to the poor is just theft. That said, giving everyone the chance to, learn, earn and make good for themselves and their families is vital. A rising tide lifts all boats.

  23. Posted January 11, 2020 at 10:05 am | Permalink

    The problem is how do you fix the issues, unless you get rid of the flawed intellectual foundations of current policy debates, you can’t have an appropriate discussion of policy or of the “practical constraints” that actually exist.

    The point is that the intellectual foundation of such restraints/constraints is most often either a misunderstanding of the operations OR the restraints actually do exist but only under different monetary regimes especially as if the UK is on the Euro.

    What are held out as a financial constraint is usually not that at all. Typically, in macroeconomic policy the constraints are political and voluntarily imposed. The sophists then dress these political constraints up as financial constraints using gold standard type macroeconomic models which appear throughout the literature to avoid addressing the real issue.

    The left will prefer Keynsian pump priming and create roads to nowhere.

    The right will continue to grow economies in the back of private debt. The debt that really matters. Private sector debts and deficits are a million times more unstable than government debts and deficits.

    These policy constraints on false understanding are counterproductive that’s pretty much the entire problem. If the mainstream theory on tax cuts and government spending were true we would be living in an eutopia. We have tried these theories a hundred times so that should tell you they are deeply flawed.

  24. Posted January 11, 2020 at 10:19 am | Permalink

    Yes, it’s not Capitalism unless the vast majority own capital. They must all have something to defend, to lose – then we don’t get monkeys elected (literally in one mayoral election in the north east)

  25. Newmania
    Posted January 11, 2020 at 10:20 am | Permalink

    I used to catch a bus along the Caledonian Road. On my left lay the mouth-watering squares of Georgian Barnsbury from whose ornate squares children waft upwards to private schools becoming challenging film directors, journalists and what not.
    To the right was a mix up to the railway lines with areas of high density council housing . Sometimes children from each side would pass eachother and as I watched some scene of this sort I thought .. “How strange they have no idea that their lives will never cross again ..”.
    Opportunity has declined for decades the young without capital have less chance
    By the time you are paying tax your life is 99% decided !
    The coalition tried to address the problem of pre-equality ( as “red Ed”..put it ) with pupil Premium, New Labour dragged our schools out of the dark ages. This administration cares about nothing but its parochial hatred of Europe for which the young will pay more than anyone.
    The idea that by removing taxes either inequality will be improved or wealth created is , somewhat lacking in nuance, to put it kindly, in any case, there is no money .

    • Edward2
      Posted January 11, 2020 at 4:14 pm | Permalink

      Socialism won’t cure equality.
      Other than making everyone equally poor.

    • Peter
      Posted January 11, 2020 at 4:21 pm | Permalink

      “Sometimes children from each side would pass eachother and as I watched some scene of this sort I thought .. “How strange they have no idea that their lives will never cross again ..”.

      Not necessarily.

      Areas get gentrified.

      So those from the poorer side might get bought out by the richer ones. Look at Hackney, Brixton, Clapham etc – even Bethnal Green. Change occurs where you might not expect it.

    • Posted January 11, 2020 at 7:38 pm | Permalink

      there is no money .

      Never before in political history has this myth caused so much damage to the fine people of this country Newmania.

      May I suggest you study money creation. Both government spending and bank loans.

      We can NEVER run out of money. The government is not revenue-constrained and can spend whatever it likes but that doesn’t mean it should spend whatever it likes.

      The point is obvious – there are definite economic limits on the ability of governments to spend and they are defined by the skills and real resources that are available at any point for sale and are not being utilised (or purchased).

      Beyond that you get inflation.

      It was a joke that went badly wrong and then highlighted the political nature of the decisions taken and the way the options were presented. It was a false constraint to meet political goals dressed up as a financial constraint by the liberal right.

      Millions are still living with the consequences of that joke and false understanding.

      • Edward2
        Posted January 12, 2020 at 12:49 am | Permalink

        What level of inflation is OK for you Derek?
        It is 2% now with current modest levels of magic money creation.

        • Posted January 12, 2020 at 10:29 am | Permalink

          Very interesting question Edward.

          Full employment should be the goal and government has all the tools available to keep inflation in check.

          Fiscal policy, monetary policy must work hand in glove.

          We have one of the best private sectors in the world that can work together with government to reach full employment and keep inflation in check.

          Japan has an unemployment rate of 2.2% that is very close to full employment. Spent quadrilions of YEN and ran very large budget deficits. Used effective monetary policy and has an inflation rate of 0.5%.

          All of that with a strict immigration policy.

          Unfortunately, most of the models we use at the moment are deeply flawed. Pretending we are in the Euro.

          • Edward2
            Posted January 12, 2020 at 12:38 pm | Permalink

            Then you have to define what you mean by full employment
            Some think we are very close to that level now.
            In just 10 years anyones savings reduce in value by 20%
            I see you didn’t really answer my question.
            What level of inflation would you target?

        • Posted January 12, 2020 at 10:46 am | Permalink

          Tax cuts are the same Edward.

          Cut taxes giving people more money to spend can cause inflation.

          We need models to let us know. You never know if people will save money given to them either by tax cuts or increased government spending.

          Another reason why I favour government spending on a transition job – job guarentee.

          • Edward2
            Posted January 12, 2020 at 12:40 pm | Permalink

            Then extra government spending and your transition job idea will also cause inflation.

      • NickC
        Posted January 12, 2020 at 12:56 pm | Permalink

        Derek H, Of course there is money. The only reason you can temporarily get away with peddling your MMT tosh is because the Chinese are injecting massive deflation into the global economy.

  26. Anonymous
    Posted January 11, 2020 at 10:20 am | Permalink

    If it is true that we have an ageing population then there will come a time when the old die off in a relatively short period and there is a glut of empty property. No need to build over the countryside.

    I suspect the truth is different and that we have a *growing* population full stop. Fed by *uncontrolled* immigration.

    In that case the old are not to blame and inequality is never going to be addressed if we keep on importing poor people.

    Remember. Leftists need permanent crisis in order for them to be relevant. The last thing they want to see is a Tory government create a settled, healthy and wealthy population. They don’t want a satisfied one either, which is why they create new victim groups all the time.

    • Martyn G
      Posted January 11, 2020 at 4:24 pm | Permalink

      Your last para is interesting. I think that in so many things these days – including the operations of the global warming army – it could all stem from Lenin who, in October 1917, observed that “terror is the instrument of social hygiene”. We all know what happened after that and it might it not still very apt in todays’ world?

  27. Dollop of wealth
    Posted January 11, 2020 at 11:32 am | Permalink

    Premium Bond tiny prizes were cut in number and by half in amount.
    Not a good idea in…….spreading……wealth and paying it back into the circular system starting in the corner shop and High Street. Though it spread a smile on Osborne’s face. Did he have a lot?

  28. Singo
    Posted January 11, 2020 at 11:41 am | Permalink

    The French Lotto, in my opinion and I may stand corrected, spreads wealth widely in many more small prizes, better odds of winning something, but less mega massive top prizes usually.
    No doubt they waste it on buying a bottle or two when collecting their prize money thus downing the French wine industry up and down the country.
    There is method in alcoholism

  29. nhsgp
    Posted January 11, 2020 at 11:59 am | Permalink

    Where are all the assets from the contributions to the pension systems you run?
    Ah yes. 14 trillion pounds of debt, and zero assets. You’ve redistributed the wealth, and now you complain about the result.
    Based on ONS numbers, that’s £550,000 per tax payer, rising at 17.5% a year.
    It’s that pension ponzi that causes the wealth inequality, and you are running it

  30. nhsgp
    Posted January 11, 2020 at 12:01 pm | Permalink

    What government needs to do is to make sure it eases the way for the young to accumulate, save and invest.
    =====
    Then instead of National Insurance, force people to invest the 20% of income they pay.
    Ah yes, you can’t allow people to do that, because of those debts.
    How is the average person going to pay their fair share? They need to find £90,000 next year to stop those debts increasing.
    All based on ONS numbers, and all hidden off the balance sheet. Why would pensions be hidden off the books?

  31. DOMINIC
    Posted January 11, 2020 at 12:07 pm | Permalink

    The importance of private property rights, the profit motive and the innate human motivation to protect and promote our own interests are fundamental to our way of life. Marxists and their authoritarian plan reject all of this. Why? Because their path involves assert control over individuals.

    The Anti-Marxist path involves individuals asserting control over themselves and Marxists despise that. Their hate of the private and of freedom is such that they will construct any fallacy to justify their sinister aims.

    If playing individuals off against each other according to age, race, wealth, gender, religion and sexuality to create a political dynamic to achieve their aims then that’s what they’ll do

    It is unfortunate and blatantly self-evident to all that the Tory party is palpably incapable of explaining this process to the electorate. Indeed they have gone so far as to embrace it.

    Marxism affords western governments are useful tool of social control which may explain why it’s never been criminalised

    • Martin in Cardiff
      Posted January 11, 2020 at 5:25 pm | Permalink

      Who is proposing Marxism?

      Even Hayek was forced to clarify, that by “socialism” he meant “command economy”, so his criticisms apply to nothing proposed in the UK.

  32. Javelin
    Posted January 11, 2020 at 12:08 pm | Permalink

    The Labour economic policy relies on the assumption that you can tax wealth and invest that wealth at the same time.

    In otherwords the Labour Party must insure government spending creates wealth nationally and not internationally.

    The Conservative economic policy relies of on taxing just enough to support those in need.

    In otherwords the Conservatives must insure wealth is directed to wealth creators – which means not into the hands of international investors.

    So the three policies necessary for wealth creation are

    – Ensure Government spending benefits the needs of the country
    – Do not spend money to benefit other countries
    – Do not let globalists siphon wealth out the country.

    • Martin in Cardiff
      Posted January 11, 2020 at 2:08 pm | Permalink

      In case you haven’t noticed, we have a Tory government with a majority of eighty.

      We have had Tory rule for ten years already too.

      So why do you persist in speculating what a hypothetical Labour government might do, five years from the next election?

      Is it because you’d rather not discuss the mess that you Leave voters have heaped upon this country, and what the Government for whom you voted might have no choice but to do, exactly as the Remain campaigns indicated?

      • NickC
        Posted January 12, 2020 at 12:59 pm | Permalink

        What, you mean like the half a million extra unemployed, and the recession, because we dared to vote Leave? Those Remain prophecies?

  33. Christine
    Posted January 11, 2020 at 12:14 pm | Permalink

    You cannot call yourselves a Conservative Party while you continue to erode the basic drive that we all have to work hard and then benefit from the fruits of our labour. For the first time ever the younger generation will be worse off than their parents. If you are young and do not have the benefit of financial help from your parents to become a home owner and raise your family within a good secure environment, you are basically stuffed. Add to that the ridiculously high CG and inheritance taxation rates and parents are unable even pass on their money when they die.
    The CP has done absolutely nothing to ring fence housing for UK born citizens. Other countries do care and protect the housing stock from overseas investors. Out of control immigration also plays a part in availability of housing for UK born citizens. Try sorting out that mess. You have a sufficient large majority to grasp nettles. This is one that you simply must not shirk.

  34. NickC
    Posted January 11, 2020 at 1:14 pm | Permalink

    My first house cost twice my annual salary; my second cost 3.5x. One of my son’s first house is expected to be 10x his salary. That can’t be right. Excessive open door immigration has (at least) two effects: it pushes down wages (excess supply); and it pushes up house prices (excess demand).

    It is a plain fact of supply and demand that if half of the foreign born migrants went home (c5 million), wages would rise and house prices fall. Your government may have been made to feel uncomfortable about this by the anti-British pc whiners, but it is true nonetheless.

    • Martin in Cardiff
      Posted January 11, 2020 at 2:14 pm | Permalink

      If half of the Leave voters went to a better place then home prices would fall even more.

      At least our fellow Europeans working here are generally young, fit, tax-paying, ready educated, not in need of health care, and according to Oxford Economics, produce a net benefit of over seventy thousand pounds each during their stay unlike said voters – though John says that capital costs must also be considered.

      • Edward2
        Posted January 11, 2020 at 4:18 pm | Permalink

        Well then Martin, all we need to do for UK people to get really rich is to increase immigration to several million a year.
        At the £70,000 net benefit per person you claim we will all be millionaires.
        Strange how GDP per capita statistics doesn’t show your figures work.

      • Robert mcdonald
        Posted January 11, 2020 at 7:03 pm | Permalink

        There are a number of criminals over here from Europe, who we can’t stop entering … and leaving with our money.

      • Fred H
        Posted January 11, 2020 at 8:14 pm | Permalink

        They must have looked further than the Uber drivers, the couriers, the plumbers, decorators and restaurant workers I come across. All noble worthwhile jobs – but how does the £70k net benefit compare to other jobs done by Brits?

        • Martin in Cardiff
          Posted January 12, 2020 at 7:41 am | Permalink

          Read the report by Oxford Economics.

          John criticises it, but he has his angle too.

          • Edward2
            Posted January 12, 2020 at 11:08 am | Permalink

            I have.
            I found it’s conclusion were based on some very odd figures.
            For example the costs to the country of the children of new arrivals were ignored.

          • Lifelogic
            Posted January 12, 2020 at 12:42 pm | Permalink

            Me too, all sort of highly questionable figures, calculations and assumptions.

          • Martin in Cardiff
            Posted January 12, 2020 at 2:33 pm | Permalink

            They were not “ignored”.

            The report compared the net benefit of European Union settlers here – and others – with like UK-raised people. So it was interested in differences.

            It reasonably assumed, that as the birth rates among them were similar to those in the UK, and the costs per child would also be similar, that this aspect would not contribute greatly to the difference for our fellow Europeans.

            In fact, those here tend to have somewhat fewer children.

          • Fred H
            Posted January 12, 2020 at 8:15 pm | Permalink

            define OE settlers from EU? Excludes the 2/3 year immigrants who go back? You mention rates of offspring – so they took advantage of our free maternity benefits and hospitals then! What was the survey size? Where/How selected? Period of time this was carried out? Any fool can throw your fine sounding conclusions around.

          • Edward2
            Posted January 12, 2020 at 8:50 pm | Permalink

            Then tell us why GDP per capita isn’t rising after 7 million people adding £70,000 per person have arrived?.

      • Fred H
        Posted January 12, 2020 at 12:32 pm | Permalink

        I thought you, mh, Andy etc were alarmists that they were leaving the UK in droves? NHS, care homes, agriculture were on their knees?
        Armageddon imminent?

    • Lifelogic
      Posted January 11, 2020 at 3:07 pm | Permalink

      These multiples are not the full story. Firstly you can now get ten year fixed mortgage rates at under 2%. So even borrowing £500K might only cost you just £10,000 in interest (the equivalent of rent). When I borrowed £80K to buy a flat (about 33 years back) I had to pay about 10% interest on it so £8,000 PA which was far more then in real terms that £10,000 now.

      Secondly houses now tend to have more insulation, double glazing, more bathrooms, gyms, high pressure hot water systems, full central heating, alarm systems, audio visual systems, car charge points, conservatories and the likes. They are not just bricks, timber, tiles and a few single glazed windows.

      Thirdly it is supply and demand. Plenty of houses around for under £50K but in areas where there are more houses than people who want them. In high demand areas you restrict supply by price or you have to ration them in some other way. Houses overlooking the Thames in Chelsea are rather scarce after all.

    • margaret howard
      Posted January 11, 2020 at 6:11 pm | Permalink

      Nick

      But who would do all the dirty jobs the locals refuse to get out of bed for? Here in East Anglia no harvest would be possible without hard working foreign labour. Nobody fancies bending over a field of sprouts on a cold November morning. Or doing the unpleasant duties involved in looking after the old or dementia patients.

      House prices rose since the seventies because people were encouraged to regard houses as investment potential rather than places to live. And when interest rates fell to virtually nothing after the financial crash they started investing in property to supplement their income.

      • Edward2
        Posted January 12, 2020 at 12:53 am | Permalink

        Interesting you think house prices rose just because people were told they would rise.

        PS
        We already have several million new arrivals in the UK
        Just how many people are needed to pick sprouts?

      • Fred H
        Posted January 12, 2020 at 12:27 pm | Permalink

        mh – – not many want to buy loads of sprouts apart from the build-up to Christmas!

      • Lifelogic
        Posted January 12, 2020 at 12:44 pm | Permalink

        They would have to pay people a bit more to get people to do the job or to mechanise the process more where possible.

  35. Time Lord
    Posted January 11, 2020 at 1:41 pm | Permalink

    btw. Please don’t allow Mr Hurd to sense that I mentioned he was fond of the Pet Shop Boys song. He would puzzle. There is no way I could or can know. That can be thought of, by you lot.

  36. Alec
    Posted January 11, 2020 at 2:49 pm | Permalink

    When was the last time we had a decent tax reduction? When can we expect one? Not soon I suspect.
    Instead we’ve seen a massive wave of economic migrants, continuous policies to raise the price of property, stagnation of wages and gross illegality in the financial sectors. All of which work entirely against wider property ownership. If lower taxes and wider property ownership are the aims of conservative governments then they have failed completely.

    • Lifelogic
      Posted January 12, 2020 at 12:45 pm | Permalink

      Or indeed any net tax reduction at all?

  37. Ian @Barkham
    Posted January 11, 2020 at 4:29 pm | Permalink

    We can all do our bit to contribute and provide for others. The Problem is after a Generation, regardless of what they call themselves, of left leaning interventionist governments, the people feel embattled and ignored. It is Government that has demobilized good will and induced gimee into the culture

  38. Anonymous
    Posted January 11, 2020 at 10:52 pm | Permalink

    “There are two ways of reducing equality.” ???

  39. APL
    Posted January 12, 2020 at 12:57 am | Permalink

    JR: “There is then the Conservative way, which is to find ways to help people into better paid jobs and to assist them become owners and savers. Taking tax down is one of the best ways the state can help with this.”

    Pity we haven’t had a Conservative administration for … decades.

    We have had a ConLab administration that believes in devaluing the savings and currency in which everything in the Sterling zone is denominated in, by 3% a year.

    Making everyone in the Sterling zone 3% poorer each and every year.

    Then as if that wasn’t enough, the ConLab government has forced interest rates down, so that the government can expand borrowing and their chums in the banking system can continue to pay themselves obscene bonuses.

    And the politicians make sure they are insulated from the privations of their own policies by raising their own salaries, and padding out their own pensions. Not to mention stuffing the second chamber of the legislature with their chums that the people have dismissed at least one time already.

    • Lifelogic
      Posted January 12, 2020 at 12:47 pm | Permalink

      Much truth in that.

  40. Lindsay McDougall
    Posted January 13, 2020 at 1:20 am | Permalink

    If the government wants the young to accumulate, save and invest, it should raise base rate to half a percent above anticipated inflation. We need to move to a mortgage market where 95% mortgages are routinely obtainable and rely on higher mortgage interest rates to drive down house prices. Such a policy would help the middle classes at the expense of the ultra-rich. Speaking of the ultra-rich, it would be better to have a low flat rate of stamp duty but to add a couple of Council Tax bands at the top end of the scale so that they make a proper contribution to local government revenue.

    Just because all other countries are loosening monetary policy is no reason for us to do so. Sanity is something that you can enjoy by yourself. What measures are proposed to deal with the inflation that would inevitably be generated by a loose monetary policy?

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

  • John’s Books

  • Email Alerts

    You can sign up to receive John's blog posts by e-mail by entering your e-mail address in the box below.

    Enter your email address:

    Delivered by FeedBurner

    The e-mail service is powered by Google's FeedBurner service. Your information is not shared.

  • Map of Visitors

    Locations of visitors to this page