http://taxpayersalliance.org/index.php/site/index/ Fairer taxes not lower taxes en clifford@edition.co.uk Copyright 2010 2010-07-23T09:13:07+00:00 http://taxpayersalliance.org/news/goat-embarrasses-government/ http://taxpayersalliance.org/news/goat-embarrasses-government/#When:09:13:07Z Last week, we reported on how the government’s crowdsourced Spending Challenge website had descended into farce. Days later, the Treasury pulled the plug on the project, deleting the genuinely funny suggestions along with the hateful racism. All that is left is a bog-standard web form. The government has decided it prefers Web 1.0 to Web 2.0 after all. But what of Spending Challenge’s spin-off Facebook group? It was announced earlier this month to a great deal of hype. David Cameron said: “We are giving people an opportunity with Facebook and I am sure that they will take it.” He even discussed the idea in a video conference with Facebook founder Mark Zuckerberg. But alas, as of this morning, the government’s Facebook revolution had gathered a mere 82 followers. We know what you’re thinking: a goat could do better than that! In fact a goat did do better than that – and we are grateful to our friends at Liberal Conspiracy and Political Scrapbook (from whom the above headline is shamelessly stolen) for helping us test the hypothesis. So if the government gets on your goat (sorry), sign up now. 2010-07-23T09:13:07+00:00 http://taxpayersalliance.org/news/hedge-fund-manager-and-other-non-jobs/ http://taxpayersalliance.org/news/hedge-fund-manager-and-other-non-jobs/#When:10:33:27Z The Guardian recently published a good article on the reality behind public sector “non-jobs”. But one of the comments below it – by “broink” – is well worth requoting for its perfect riposte to TPA non-job nonsense: “Consider a hedge fund manager. Sounds very useful. What do they do? To someone who had no idea, you might guess that they looked after the money to fund the maintenance of the vital ecosystems in Britain’s hedgerows. But actually the nature of their non-job is that they bet vast amounts of other people’s money on numbers going up or down, ruining lives willy-nilly and making millions of pounds for themselves which they can then squirrel away off-shore so they don’t have to pay any tax. If that isn’t a non-job, I’m at a loss to think what is. Ah, but of course they aren’t employed by local government.” Any other suggestions for private sector non-jobs? 2010-07-22T10:33:27+00:00 http://taxpayersalliance.org/news/new-schools-network-goves-next-fiasco/ http://taxpayersalliance.org/news/new-schools-network-goves-next-fiasco/#When:18:21:58Z What a curious beast is the New Schools Network, the "independent charity" that championed the plans for "free schools" now being rushed through Parliament by Education Secretary Michael Gove. Click on the group's online form to "Sign up for more information" and a message appears: "We may pass relevant details to the Department for Education so they can provide assistance. If this is a problem please email us on info@newschoolsnetwork.org." How many other "independent charities" pass your details to government unless you email to object? Then again, how many other charities get £500,000 from the government to implement the very policy they've been lobbying for? At a time when the Treasury promises to scrutinise – if not eliminate – every penny of spending, it seems incredible that this grant received so little attention, not least because NSN director Rachel Wolf, who set up the organisation just nine months ago, is a former advisor to Michael Gove. No wonder NSN cheerleaders were ecstatic when Gove got the education portfolio. A few journalists, though, have raised questions. Tom Clark highlighted the network's lack of transparency in an excellent report rather buried within Education Guardian, which prompted an angry response from supporter Toby Young. And Jonathan Freedland, exploring the Coalition's weak points, wrote: "There's more gold in them there hills. I wait to hear Gove face questions on the hefty £500,000 dollop of public money he just ladled on to the plate of the New Schools Network, a six-person thinktank run by one former special adviser to Gove and "helped out" by another. The NSN is meant to give advice to parents looking to set up their own "free school" – Gove's ideological pet project – but it's hard to see how their guidance could be wholly impartial." We'd like some answers to those questions too, and have made the following Freedom of Information requests. The Department for Education has until 5 August 2010 to reply. DfE relationship with New Schools Network 1) Please send me a copy of the business case with costings presented to the DfE by the New Schools Network (referred to in your letter here: http://bit.ly/9ziO9o) 2) Please declare whether tenders were sought from other organisations for providing these services. 3) Please confirm whether you assessed the NSN's funders to ensure that there was no possibility of a conflict of interest with the DfE's work (eg to establish that none of the funders had a commercial interest in promoting free schools). If so, please supply a list of NSN's funders. • The Anti-Academies Alliance newsletter has more about free schools and the New Schools Network. 2010-07-21T18:21:58+00:00 http://taxpayersalliance.org/news/the-elephant-in-the-macroeconomy/ http://taxpayersalliance.org/news/the-elephant-in-the-macroeconomy/#When:10:28:36Z Guest post by Richard Murphy At a recent Smith Institute debate on the budget, I was surprised to find myself agreeing with Mike Devereux of the Oxford Centre for Business Taxation. In essence he said that the debate between the parties was largely inconsequential on deficit reduction. All parties say it has to be done; all say it has to be done reasonably soon, and all think a combination tax increases and spending cuts are essential. The difference between Labour’s preferred 65% cuts / 35% tax and the Tories 80% / 20% is 1% of GDP in reality according to Mike. And as he put it, candidly, either way more than enough was being done to meet the requirements of the markets – if the promises are delivered. And yet Mike, in making that comment, ignored the elephant in the room: that this uniformity suggests there is remarkable agreement on the role government has to play in the current phase of this financial crisis. The implicit agreement is that it should exit the economy, stage right. And this is where I fundamentally disagree. People may (or may not) intuitively think that government has been overspending and must rein back now – as Tory MP Kwasi Kwarteng claimed during the debate – but this sentiment was more than adequately and accurately described long ago by Lord Keynes, who called it the paradox of thrift. In essence, the instinctive reaction of households in the face of crisis, uncertainty and increasing debt is to scale back expenditure and to increase savings. That reaction is entirely rational, but it does, despite that rationality, create the crisis we now see – to which none of the speakers referred. That crisis is that individuals are doing just what Keynes suggested they would do. They are saving more (even if that saving is evidenced by paying down their mortgage faster than strictly required whilst interest rates are low, because that qualifies as saving in these terms). This graph from the Office for Budget Responsibility shows it: The UK household savings ratio has risen since the financial crisis developed, and is expected to stay high. That means people are not spending. That means there is a shortage of spending in the High Street. And that means companies will not invest. As Martin Wolf has pointed out, the UK private sector savings surplus is running at something like $200bn or £135bn a year as a result now (give or take is good enough here). This means, because these funds have remarkably little use elsewhere since all countries are all in the same boat right now, that these funds are being used to finance our own deficit, almost in its entirety, which is why 90% of our debt is owned in the UK at this time. In other words – the real macroeconomic issue of the moment, the one the whole panel ignored and which the whole debate is ignoring – is the astonishing fact that we are quite able to fund our current scale of government spending and are doing so without difficulty, but the mechanism we are using to fund it is not called tax right now. However, if we don’t want to call the current funding of the deficit tax – instead thinking of it as saving – then the real debate is not about whether we need cuts, since it is apparent that the deficit is being funded and will continue to be funded for some time to come, but is instead how we actually use those funds we are choosing to lend to the government. The Coalition plan is to spend that money on unemployment benefits since it is readily apparent that they want to put 1.5 million or more out of work and that the consequence will be a spiraling paradox of thrift with the result that we will move to depression from recession. The alternative is that we make a very different choice. We could choose to spend that money on investment in our economy. We could do the Green New Deal – the only industrial strategy for the UK written in many a long year but the exact missing part of the equation that is required now. The Tories presented a budget that assumes we want a small state. I guarantee that this sentiment in the country will change very rapidly and very soon when people realise what this really means. As one astute observer put it today, very few people in the UK realise just how dependent they and others are on state services and how much their absence will affect the quality of their lives – even if they still have a job. I do not believe people want a small state. But equally I do not think we will get the state we want by hoping for it or by playing with some minor change to corporation tax rates or allowances. We will only get it by breaking the current epidemic of thrift that is ensuring we can pay for the deficit, but which is also going to be squandered on current expenditure which will provide no chance of paying a return on the debt. An industrial policy will create jobs. It will stimulate the economy. It will send cash back into the private sector. It will encourage spending. It will recreate the tax base. It will reflate government revenues. It will close the deficit. It will create new jobs. If it’s a Green New Deal it will ensure we have enhanced energy security, so supporting the value of the pound as well as earning long term returns. And there will be jobs. This is what macroeconomic policy is. Arguing about tax rates is little more than glorified micro. Or to put it another way, the debate reminded me rather uncomfortably of the rather odd people who came to see me when I was a practicing accountant. They wanted advice on business structures and tax planning for their profits from the business they were about to start which was going to make mega-bucks. But when you asked them what it was going to do they didn’t know – they were going to get the structure right first, they said. That genuinely happened occasionally. And that is what economic debate is like in this country right now – focused on getting the structure right for business – but no one has the faintest idea what the business might be. Those potential clients who asked me those questions were destined to never make money. And the UK is destined to never get out of recession unless we know how we are going to earn the tax base which can restore government revenues. George Osborne, Vince Cable and Alastair Darling have not addressed that key question. And they're also ignoring the glut of savings we currently have – which need a productive home. So, as Gordon Brown's former special advisor Chris Wales said during the debate, we need a discussion on how big the state should be (much bigger than the Tories think is the answer) and how we should pay for it (more tax is the answer) but first we have to get people working. The lack of an industrial policy is the elephant in the room right now. And I’m happy to offer the Green New Deal in the absence of alternatives. • Richard Murphy is an adviser to the Tax Justice Network and the TUC on taxation and economic issues. This article is cross-posted from his blog, Tax Research UK. 2010-07-16T10:28:36+00:00 http://taxpayersalliance.org/news/i-hate-buses-the-symbol-of-a-socialist-sociey/ http://taxpayersalliance.org/news/i-hate-buses-the-symbol-of-a-socialist-sociey/#When:04:26:21Z We recently reported on the TaxPayers’ Alliance’s latest statistically-challenged assault on speed cameras. The report was co-published by the Drivers’ Alliance, the TPA’s astroturf partners with whom it shares staff and office space. So the next time you see the Drivers’ Alliance given a serious airing in the media, be sure to reflect on the entirely reasonable and balanced views of its founder, Peter Roberts, expressed in his latest blog post: I hate buses I hate buses, I really do hate them. I hate them because they are so uncomfortable, I hate them because they rattle, stink and are sweat dripping hot torture chambers in the hot weather. I hate them because the driver cannot turn the heating off even when the outside temperature is 28deg and inside is 38deg plus. I hate them because they are so slow and trundle all over the place before letting you off. I really hate them because they are loved by the environmental zealots who think it is OK to cook passengers in tin with the heating on in the middle of summer and I hate them because they are an environmental catastrophe. Buses are the biggest gas guzzlers on the roads. They burn diesel at the rate of a gallon every 3 to 4 miles and chuck out 1.8kg of C02 for every km travelled. A decent family car emits about 155g which is more than 10 times less. Oh, but the public transport advocates will tell you a bus carries more passengers so they are good for both you and the environment, but the average number of people on a bus is just 9 and the car carries an average of 1.6. This means a bus passenger emits 200g of CO2 per km whilst a car occupant 97g. I hate buses because the industry behind them is spinning the argument in favour of public transport over the car and using lies, damn lies and statistics to stake their claims. I hate public transport because the companies fund anti-car pressure groups to try and make cars the environmental pariah whilst claiming the bus/train is the solution to all our problems. I hate the bus because their backers conspire to remove parking spaces, increase parking charges, introduce speed cameras and reduce speed limits. I hate buses because they hold up lines of traffic whilst stopping every few hundred yards at a stop and I hate them because I have to suffer their stink when behind them or when they pass by. And finally I hate buses because they are the symbol of a socialist society where people rely on the state to provide transport. I believe we should encourage aspiration and ambition and to make our own way in life. Owning a car offers freedoms and opportunities bus passengers can only dream of and the car is the most efficient form of transport there is. So much anger can’t be good for you. But is it really buses he hates, or just the people who use them? 2010-07-16T04:26:21+00:00 http://taxpayersalliance.org/news/any-thoughts-at-all-will-do/ http://taxpayersalliance.org/news/any-thoughts-at-all-will-do/#When:21:08:16Z David Mitchell and Robert Webb outline the thinking that inspired the government's Spending Challenge website. Hat-tip: Alix Mortimer. 2010-07-15T21:08:16+00:00 http://taxpayersalliance.org/news/spending-challenge-race-hate-meets-comedy-gold/ http://taxpayersalliance.org/news/spending-challenge-race-hate-meets-comedy-gold/#When:14:34:56Z The government's Spending Challenge website, launched on Friday, invites us to send our ideas for cuts. "A team has been put together right at the heart of government," claims the blurb on the homepage, "and their job is to make sure that your ideas and comments are taken seriously." Which is deeply worrying, because for the most part the contributors to Spending Challenge give the impression that they have moved there directly from the Daily Express comments board. Many entries have little bearing on government doing "more for less" and instead reflect personal hobby-horses, like the ubiquitous "Bring Back Capital Punishment". Others are exercised by "benefit scroungers", such as the contributor who wants to sterilise young girls who "just breed at will". One of the most popular tags is "immigration". Entries here tend to fall into one of two categories: racist ranting written entirely in lower case RACIST RANTING WRITTEN ENTIRELY IN CAPITALS The former includes a post, "there is only one way to save money", which states: "now i am not a racist person but this country has had problems since the early 60's we need to decrease the number of immergrants in the uk i walk dow the street only to see hundreds of illegal immergrants that cant even speak english and i mean polish and muslims mainly and most of themare working in our local shops and local call centres." The latter includes "STOP IMMIGRATION START REPATRIATION", which even links to a Facebook group. All of which has led one contributor to ask: "Is the moderator asleep?" The answer seems to be yes, as many hateful comments remain online despite being having been highlighted on Twitter and in blogs since the weekend. Some users have helpfully added the tag "Racist" to offending posts to assist the sleepy moderator. Where is the TaxPayers' Alliance when you need it? Why is the govenment spending our taxes on a repository of racial, sexist and homophobic hate? The BNP already has a website. Happily, there are some more enjoyable moments to be found amongst the dross, including the following austerity-inspired measures: Windfall tax on people called Steve Sell the unemployed after six months on benefits Force cats to spend one hour per day on electrical treadmills MP housing allowances to be replaced by tents Divert all welfare funding to Nuclear Weapons There is also a highly-rated recipe for "Beef and vegetable casserole", described by one visitor as "the most sensible thing I have read on this site". And is it just possible that Ed Balls has joined in too, with a suggestion to "Send one Miliband brother to Africa to supplement international aid"? "In this age of austerity we can't really afford two of them," writes "jeesus"/Balls, who adds thoughtfully: "Flights have a huge carbon footprint so he should be sent there with a boat." Perhaps the most ingenious suggestion is entitled "Create Spending Challenge Website": "Create a website where the entire population of the UK can make absurd suggestions on how the Government can save money. Allow easy access and registration so that users can create multiple accounts to vote on their own suggestions. As hundreds of thousands of citizens will be sat on their computer, they will not be a drain on resources outside their own homes such as roads, police, oxygen etc. Saving money." So why is Spending Challenge turning into the Tories' biggest crowdsourced car crash since Cash Gordon? First, the premise is wrong. The deficit has spiralled due to bank bailouts and recession – particularly falling tax revenues. Government cuts – driven by ideology rather than necessity – may well increase the deficit by dampening growth. If Spending Challenge focused on improving services, it might have something to commend it. But the title gives it away: it's about cuts. Second, this simple crowdsourced approach, while perfect for the Photoshopped fun of MyDavidCameron, is entirely ill-suited to developing policy. Guy Aitchison explained why, in relation to the government's more benign Your Freedom website: "I have some experience of trying to run an online political consultation having done so with the Power2010 campaign. As with 'Your Freedom' we asked people to submit ideas to be discussed and debated online in comment threads before being voted on. This process brings with it the well-known problem that the most organised and active interest groups will push their agenda to the fore (this is true of democracy in general, of course, but on the web it's amplified). It is also extremely limiting. People visiting a website have no obligation or real incentive to educate themselves on the issues or explore alternative points of view. It’s easy just to turn up, copy and paste your favourite rant, and then move on. "Of course, there will be moderators who can identify this but I can’t help but feel that an opportunity has been missed to build in more deliberative processes that would have allowed people to explore and probe the issues face-to-face, as happened with Power2010’s deliberative poll ran by James Fishkin which brought a representative sample of over 100 people together over a weekend to discuss political reform. "It was striking how seriously people treat the issues when given the chance (especially compared to most web discussion) and I can’t help but think an opportunity has been missed for a much richer public discussion of what the values are that people want protected. This could have informed and fed into the online deliberation and would have also been more inclusive allowing the large percentage of the population who aren't internet users to join in." Others, too, seek more meaningful forms of public engagement – Paul Evans's Local Democracy blog is well worth reading. But for now we must make do with cut-and-paste ranting, which means this might be the only Spending Challenge suggestion that actually works: "Charge £10 a go for suggesting 'make benefit claimants work for their money' on this site." (A shorter version of this post appears at Liberal Conspiracy.) 2010-07-13T14:34:56+00:00 http://taxpayersalliance.org/news/one-hand-on-the-wallet-one-foot-on-the-accelerator/ http://taxpayersalliance.org/news/one-hand-on-the-wallet-one-foot-on-the-accelerator/#When:09:45:42Z Hmm, who would you trust on the issue of speed cameras? The TaxPayers’ Alliance and its astroturf partner, the Drivers’ Allliance? Or RoadPeace, the charity that supports crash victims, campaigns for safer roads and is transparent about its finances? RoadPeace has blasted the TPA’s latest anti-speed camera report. The organisation says the TPA’s analysis is “inappropriate”, “biased” and “botched”, and concludes: “In this broadside against speed cameras the TPA show their true colours: if their concern were really taxes, they would see the revenue raised from camera fines as a welcome shift of the tax burden from the innocent to those who break the law and endanger the lives of others; despite their reams of statistical tests that supposedly back up this press release, they lack either respect for or knowledge of data analysis and are unconcerned with evidence. “Beneath a banner of public interest and dressed in the trappings of science, TPA pursue an agenda of self interest and obfuscation. The price will probably be paid by others but there will be blood on their hands.” Read the full response to find out how the TPA filtered its figures. And if that fails to convince, check out the excellent FullFact website, which challenges the lazy assumption that speed cameras are simply “cash cows”. 2010-07-10T09:45:42+00:00 http://taxpayersalliance.org/news/alan-budd-on-the-tories-real-motives/ http://taxpayersalliance.org/news/alan-budd-on-the-tories-real-motives/#When:09:24:51Z Sir Alan Budd's sudden resignation from Osborne's Bureau for Rebuttal is the perfect moment to remind ourselves of his astonishing – but essentially correct – analysis of Tory economic policy in the 1980s (from Adam Curtis's 1992 documentary Pandora's Box). Sir Alan told Adam Curtis: "The nightmare I sometimes have, about this whole experience, runs as follows. I was involved in making a number of proposals which were partly at least adopted by the government and put in play by the government. Now, my worry is … that there may have been people making the actual policy decisions … who never believed for a moment that this was the correct way to bring down inflation. "They did, however, see that it would be a very, very good way to raise unemployment, and raising unemployment was an extremely desirable way of reducing the strength of the working classes -- if you like, that what was engineered there in Marxist terms was a crisis of capitalism which re-created a reserve army of labour and has allowed the capitalists to make high profits ever since. "Now again, I would not say I believe that story, but when I really worry about all this, I worry whether that indeed was really what was going on." Update: Thanks to everyone who tweeted this, but the real credit goes to James Doran for uploading the clip and Daniel Trilling for spotting the quote. 2010-07-07T09:24:51+00:00 http://taxpayersalliance.org/news/tpa-spin-turns-dutch-innovation-into-british-waste/ http://taxpayersalliance.org/news/tpa-spin-turns-dutch-innovation-into-british-waste/#When:10:55:37Z Guest post by Dave Semple (Cross-posted from Though Cowards Flinch) Q. When is state spending considered ‘wasteful’ by the TPA? A. When it was instituted by a British Labour government. This is the impression one can’t fail to get when reading the following two statements by the Taxpayer’s Alliance on the subject of government-developed iPhone applications, which improve civic engagement. April 30th, 2010, posted on Taxpayer’s Alliance website. In the Dutch city of Eindhoven, citizens can now report broken street lights, potholes, graffiti etc. using an app on their iphones. Users can take a picture and locate the problem on GPS and maps and send it directly to the local authority so they can easily locate and solve the problem. Obviously not everyone has an iphone, but it’s a great innovation that involves citizens in looking after their community. July 6th, 2010, statement given to media by Mark Wallace, TPA campaign director, after news leaks via FOI requests that the previous government spent £40,000 on something similar. “It seems many Government bodies have given in to the temptation to spend money on fashionable gimmicks at a time when they are meant to be cutting back on self-indulgent wastes of money…It is ridiculous not only that they are commissioning these apps but that some of them are supposedly secret on grounds of national security. “Someone who is faced with losing their home because of high tax bills, or whose life is being ruined by crime isn’t going to get any reassurance from knowing there’s an app for that.” The recent furore is over the government developing iPhone apps to provide DVLA services, to provide Jobcentre services and so on. Personally I think it’s a great idea – I don’t have an iPhone, but I do have a smartphone, and applications have a way of transferring across, once developed. What I found particularly amusing about the blatantly churnalistic BBC report (some of which was cribbed direct from the wire service report by the looks of it) was this: “By the end of May there were over 53,000 downloads of the Jobcentre Plus app, although critics have asked why someone who can afford both an iPhone and the expensive running costs would need a Jobcentre Plus app.” Because even those who have been prudent with their savings and worked hard to amass them can be made unemployed, and even bottom of the chain workers can fit this particular bill? Nice to know what the BBC generally thinks of the unemployed though; if they have anything remotely fancy, there’s something funny going on. 2010-07-06T10:55:37+00:00