Poor John Denham. He has just been crucified by Dr David Starkey. The rudest man in Britain is showing why he earned the title. He has just given him an economics lesson. Denham is being treated with contempt by the crowd.
The state is far too large for the taxpayer to maintain. The civil service has expanded rapidly along with the entire public sector over the last 10 years. Some areas are entirely dependent on the state for their income. That is why Labour still manage to garner at least 25% in the opinion polls. Their client state is working for them. If you steal from Peter to give to Paul, Paul will always vote for you.
In order to reduce government spending, how about a reduction in the size of government. There are far too many departments. We could merge several departments and make them leaner and more efficient as a consequence.
In 2007, Gordon Brown created a Department of Justice. I have no idea why. Perhaps he needed a role for Jack Straw. It gets its own budget, building and staff. Get rid of the department and place its responsibilities back to the Home Office. That is a good way to save money. Secondly, we should abolish the Department of Business, Enterprise and Regulatory Reform. It serves no purpose. The Chancellor is responsible for the conditions that stimulate a productive business environment. Again, a ministerial salary is eliminated, office rentals, staff pay etc. We should eliminate the Department for Culture, Media and Sport. It is a pointless office. David Mellor used to call himself the ''Minister for Fun.'' We should get rid of the DWP and replace it with a Department for Social Security, which has responsibility for the Health Service, thus abolishing the Department for Health. Again, more salaries eliminated and administrative costs. The newly created Department of Energy and Climate Change was pointless, and it should be put back into the Agriculture Department. Abolish the Scottish and Welsh offices. The devolved administrations render them useless. A Northern Ireland Secretary is still useful. We can get rid of the International Development Office, and merge its responsibilites into the Foreign Office, which should also happen to the Europe Office. So much burueacracy can be cut by simply applying these policy prescriptions. We don't need a Department for Communities and Local Government, because we have local government which is responsible for its own area.
We can also cut the size of parliament itself. We do not need 646 MP's. Cut it down to 300, get rid of the Scottish, Welsh and Irish constituencies, because they have their own devolved parliaments. That will eliminate £45 million from the expenses bill, and the wages saved can be used for better things. The Lords of the Realm do not get paid, but we should not pay them for turning up.
In order to send a message to the public sector, MP's should take a 10% pay cut.
Therefore it must be bad. I consider my views normal, sane, logical and well reasoned if the Guardian thinks the opposite to me. The Guardian represents all that is wrong with journalism. The Guardian as a whole represents the poison that infects the Left, and the stinking hypocrisy in everything they espouse.
Let's talk Polly Toynbee as the main example. A multi millionaire with an extensive property portfolio, at a first glance, we would expect her to be a centrist or on the centre right. She is firmly on the Left. I haven't got a problem with that. People have the right to choose where their political proclivities lay. But in choosing to espouse a left wing creed, she should live by it. Over the years, Mrs Toynbee has advocated higher taxes on the rich. She has argued for redistributive social democracy. Yet she hasn't taken any steps whatsoever to redistribute her own, mainly inherited wealth. She has called for everybody to publicly declare their incomes, yet hasn't declared her own, though apparently she earns around £140,000 per annum. She rants on about the non existent problem of child poverty in this country, yet she hasn't turned her extensive number of properties into care homes for children. I routinely give money to charities for victims of natural disasters, because it is a cause I believe in. I don't lecture other people for not giving money to it. She has criticised private education and selective education, despite grammar schools being the greatest method of lifting poor children out of a life of penury and giving them a chance at success. She is the product of a private education, and even when she was sent to a comprehensive it happened to be the most elitist of them all, Holland Park School, dubbed the Eton of the state sector. She then proceeded to Oxford, not because of her brain, which is remarkably average, but because of her extensive family connections.
She represents the whole left wing culture of demonising success and pouring water over the burning fire of ambition. She constantly bemoans that the gap between the richest and poorest is at its widest ever. SO FUCKING WHAT!!! I am what she would call one of the proletariat. I live next to a council estate, and have seen it all when it comes to seeing people fuck up their lives. Toynbee wants to keep us here! I don't want to stay here. I want to earn lots of money, pay my taxes and live a comfortable life, the one Mrs Toynbee so enjoys. But I can't if Polly gets her way and raises tax on everyone with two cars. She constantly prognosticates about economics and why we should all adopt reckless and downright idiotic Keynesian spending programmes. She dosen't explain why they will work, or how. She dosen't even have a rudimentary knowledge of economics. If she did, she'd realise that there is one massive fallacy in Keynesian thinking, that borrowing from A to give to B dosen't actually increase aggregate demand in the economy because there is no new money, it has merely been redistributed.
Then people like George Monbiot write articles pontificating about climate change on printed paper, paper that is obtained by cutting down trees. And in keeping with their left wing hypocrisy, they only consider the side of the argument they agree with. In terms of my own political journey, when I was a communist, I never considered the arguments of the other side, I just called opponents ''sycophants of the rich.'' Now I am a free market libertarian, I always consider what the Left has to say, because I know I can refute it. That is the best way. I never instigate a slanging match. My insults are always a response to someone insulting me first.
The Guardian launched a campaign to stamp out tax avoidance. The Guardian Media Group has taken advantage of a loophole that enables them to avoid hundreds of millions in taxation. Polly never mentions that. The GMG was founded by a tax avoider. Polly never mentions that.
Now, regarding the Guardian's position on the budget, they have taken the predictable route. ''Taxation is the only easy way to restore a very small measure of sanity to the unjust rewards of the rich'' These are the words of La Toynbee. Unjust rewards have been made by the bankers. But these rewards have been provided by her beloved STATE. STATE SPONSORED FAILURE TOYNBEE. These taxation measures have taken us onto the wrong side of the Laffer Curve, and thus the Treasury will lose revenue. But Toynbee, who believes only the state can alleviate poverty, dosen't know anything about basic economics. It has been proven beyond doubt that punitive tax regimes drive away entrepeneurs. Without them, we wouldn't have the tax to pay for the grand utopian schemes Toynbee is so fond off.
Here is a copy of an email I sent to La Toynbee. I have yet to receive a reply.
I have just read another one of your unintentionally hilarious columns. I don't know how you do it, but you should try stand up comedy. In one of your columns, you mentioned you were a Keynesian. Weren't you a Keynesian during Brown's 10 years at the Treasury, when he ran up a huge budget deficit? I'm going to guess you haven't read the General Theory of Employment, Interest and Money. And I'm guessing you only know what most people believe Keynesian economics represents. Keynes advocated budget surpluses during periods of economic growth. Brown didn't. He achieved a surplus in 2001, but only by following Conservative spending plans. He extended the economic cycle by two further years in order to claim a surplus. But ever since then, he has run up a massive budget deficit, the fourth largest in the developed world. Keynes himself would be apopleptic at the size of the deficit. So why have you turned into a Keynesian all of a sudden? Is it because it is in fashion? I know you have no journalistic standards, and your hypocrisy knows no bounds, but even this is just socialist sycophancy at its worst.
Secondly, you know prognosticate the Keynesian economics will help us out of this mess. It won't. If you knew anything about economics instead of merely pretending to know, you'd realise Keynesianism has never worked. FDR's New Deal was a failure. Unemployment never fell below 14%. FDR merely continued the policies of Herbert Hoover. In his four years, he increased taxes. He increased the top rate of tax from 25% to 63%. Keynes was an advocate of high taxes during boom years. Hoover was a protectionist. He passed the Smoot-Hawley Tarriff act. He increased government spending by 47% in four years. FDR continued these policies, and the Depression continued until the war, when the world was forced to trade because of the war.
You claim our national debt is low. What about PFI liabilities, Railtrack, the public sector pensions liabilities and the bank bailouts. All of that money has to be paid back, and debt is money owed to somebody else. But as a millionaire with a villa in Tuscany, you won't care about us working classes struggling to make ends meet because we are crippled by high taxes.
Now, to address another Keynesian fallacy. Keynes was critical of monetary policy and its effectiveness at dealing with recession. Now, as an advocate of the Austrian School of Economics, I tend not to agree with Milton Friedman, but when he mentioned that monetary policy could have stopped the Depression, he was right, because the Federal Reserve decided to contract the money supply right at the moment banks needed liquidity. Keynes believed fiscal policy was the best way to deal with a recession. I certainly believe in permament tax cuts and controlled public spending. But when the government cuts taxes during a recession, people tend to put it away in anticipation of future tax rises. Also, there is a fallacy in Keynesian thinking. To put money into the economy, the government has to take it from somewhere else. It takes from A, to give to B. This just equals AB. No new money has been injected into the economy. I advise you to research some basic economics before you pretend to be an economist La Toynbee.
As well as the failure of the New Deal, perhaps you should take a look at the history of Keynesian economics when applied. They led to the stagflation in the 1970's, when inflation hit 26%. It led to the abandonment of the Gold Standard, which has caused so much damage in the long run because there is no effective monetary restraint because fiat currency is just announced as money because the governments says it is. Milton Friedman devised his monetarism theory, which was moderately successful where applied, although I am a fan of the Austrian School. You may laugh at that claim, because unemployment hit 3,000,000. Mr Friedman warned that the application of his policies would result in a stopover period, where high unemployment was sustained, but it would be reduced in the long run because economic imbalances would be balanced. And now the world targets inflation, a direct result of Mr Friedman's thinking.
You have also attacked the economic thinking of Mr Cameron and George Osborne. You should consider that David Cameron actually has a degree in economics, whereas Brown dosen't, so already he knows more than Brown about economics. Gordon Brown knows as much about economics as you. It's why he ran up a huge budget deficit at the top of the economic cycle, when almost all other comparable economies were running small surpluses or were in equilibrium. Derek Scott, Tony Blair's gifted economic advisor from 1997, said that Labour's economic inheritance was the best of the 20th century. Inflation had been killed, national debt was low because PFI wasn't utilised often. Interest rates were at 6.5%. Unemployment was falling rapidly, and the economy was growing steadily, all because of the decisions taken by Norman Lamont and Kenneth Clarke. That's right. I hope you respond to this email, and if you do, you make say that if I support Norman Lamont, I know nothing of economics myself. Norman Lamont was opposed to the ERM. It was the Europhiles like Howe, Heseltine and Clarke who favoured it. Lamont made the best of a bad situation, and his last budget set the course for the halving of the budget deficit and reduction of national debt. He started from a low level of national debt, 26% of GDP.
You have called Cameron's economic medicine populist poison and that it won't work. Cameron has NOT called for spending cuts. He has called for the slowing of growth. I hope he does take a scalpel to the public sector. You claim to be a champion of it, yet you almost exclusively use the private sector, e.g. schools, hospitals. It is another example of your disgusting hypocrisy, but Guardian writers don't have any morals, then again, neither do most Telegraph or Times writers anymore. The only columnist worth listening to is Simon Heffer. Most papers have signed up to the idea of fiscal stimulus. Cameron has opposed it, and rightly so. Unlike you Mrs Toynbee, we the working classes, or you do you prefer to call us the proletariat?, live in the real world. We understand that more government spending equals more taxes. Like Labour, you propagate the lie that spending cuts means cutting nurses, cops and teachers. You know it isn't true, but you are so in with the Labour establishment you prefer power at the expense of morals. We spend over £100 billion a year of quango's that serve no purpose. If we cut them, that is £100 billion in tax cuts. Because we've cut spending, people won't anticipate future tax rises, and we can spend it, thus stimulating the economy, and providing a fiscal stimulus without borrowing. Cameron has advocated a similar cause of action. His loan guarantee scheme is also favourable. Monetary activism is needed to solve a monetary crisis.
Your most hilarious claim, that social democracy is the answer, is just plain piffle. Britain has been a social democracy ever since 1997, when Blair and Brown opted for the Maastrict social chapter. We have had a massive welfare state, dedicated to alleviating the non existent problem of poverty. You like to claim poverty was rife under Thatcher and Major, and child poverty was too. There is no such thing as poverty in this country. Yes, there are the rich and poor. But if you lived in the real world, and not the fairy, rarified world of the Guardianista's, you'd realise that real poverty exists in poor African countries that are run by power mad Marxists. Most of the European countries follow the social democracy model. America is forecast to have a weaker recession than Europe and Britain. Social Democracy is a cancer to business. In 1997, Britain was the 10th most competitive economy in the world. 10 years after social democracy, we are 10th lowest. High taxes hurt businesses. The lower their corporation tax, the more people they can employ. You are very wealthy. I don't begrudge that. But you haven't earned your wealth, it was inherited. When you criticise tax dodging, why don't you criticise the Guardian Media Group. They are a bunch of tax dodging bastards. You have no idea what it is like to work to help pay the bills. You have no idea how soul destroying it is to see your income taxed for inefficient public services and armies of advisors. Until you experience that, you have no right to spout that we need high taxes for good public services. We could easily cut £100,000,000,000 from expenditure without cutting nurses, policemen and teachers. We could abolish RDA's, the quangocracy, and because people don't send letters anymore, we could privatise the Post Office. I prefer letters to the boring world of impersonal emails, but people like you don't deserve the time it takes for me to craft a beautiful hand written letter. Also, I'd imagine you'd prefer to email.
You have also criticised Cameron for following a similar path to Geoffrey Howe's infamous 1981 budget. I happen to believe Geoffrey Howe was the most successful Chancellor in 20th century politics. As always with Conservative governments, they exist to clean up the mess left by Labour governments. Geoffrey Howe took some very hard and in some cases, downright nasty decisions to reduce a massive budget deficit. It kicked inflation out of the system, and allowed rapid economic growth. It was only when Lawson eased fiscal policy far too rapidly that inflation came back, but it never reached the 26% under Labour.
There are several reasons why Howe's budget was necessary. It was deflationary, and it gave investors the confidence that Britain was committed to control its budget deficit. The economy started to improve days after the budget. Cameron has not advocated anything like Geoffrey Howe's budget. I don't know if George Osborne has the guts to do so. We are not facing deflation, despite what you claim, we are facing inflation. CPI has risen. Inflation has risen in Europe and America. RPI has only fallen because of house prices. It is the only time CPI inflation has been any use. Brown only changed it so he could avoid counting the inflationary pressures from his housing boom.
To finish it off, I ask for a reply. I'd love to see how you'd spin this. I'd love to see you accuse me of being a Tory. I am a party member indeed. But I am not a Cameroon. I am a supporter of John Redwood and John Whittingdale. Both have experience beyond Westminster. Redwood worked as a financier, and Whittingdale was an economist. You didn't even complete university, so bear that in mind when you spout such ridiculous tripe about the Opposition. George Osborne has been vindicated by events. Mervyn King has voiced support for his stance. So has Germany. You may reply that Germany has put in place a larger fiscal stimulus than Brown, but remember, they had a substantial budget surplus, because they were believers in sound money and fiscal prudence. Brown has caused a small gilt strike in this country, and the pound has fallen 30% against a basket of currencies, even the currency of Thailand has strengthened against the pound. I urge you to read Keynes' book, and then read Milton Friedman's books. Then read the Denationalisation of Money by Friedrich Hayek, and the Theory of Money and Credit by Ludwig von Mises. I am of course assuming you can read, and judging by the ideologically confused nature of your columns, I doubt that. I am not a qualified economist, but I am only 18. I could run the country better than Brown.
Go and learn some basic economic theory. Hell, you can pay me and I will teach you La Toynbee, but you will need to redistribute your own wealth to us working class proles. Also, you should nationalise your extensive housing portfolio, and allow the so called people who live in poverty in this country to use your housing. Will you La Toynbee? Will you advertise in the Guardian that you are opening up your houses for the poor? I didn't think so. Practice what you preach fool.
That was terrible. A new 50% rate. A borrowing level that is more than all previous governments combined. It wasn't a budget to restore some sanity to the economy. It was a purely political budget, designed to appeal to the small group of hardcore lefties who believe we should squeeze the rich until their pips squeak.
The 50% new top rate will only drive away those who create the jobs in this country. Jobs will be lost because if a businessman or woman employs ten people, and pays them £20,000 a year, the new tax rate will eliminate at least one of the jobs.
The borrowing levels are truly horrific, and although Captain Darling announced a steady reduction of the deficit and national debt over the coming years, he didn't explain how. The tax rises are nowhere near enough to fill the black hole created by Brown. The spending restraint is pathetic. We need to cut spending. You can cut spending without cutting frontline services easily. ID Cards can go, as can unelected regional government, the quangocracy, the spin doctors etc. We can privatise the nationalised banks, we can privatise the Post Office for some revenue. You can also go for efficiency savings throughout the Health Service, the Police and the Schools. Of course, I would cut money from them too, because we have spent far above inflation, and with the supposed deflation, money will go further now.
What if there is a gilt strike? There is no credible plan to control the deficit or the debt. Investors will get spooked if the government cannot afford to repay its debt. If there is a gilt strike, we won't be able to fund this stupid utopian schemes. The IMF will be called in, and huge spending cuts and tax rises will be forced. The government already takes in immoral amounts of tax. The FTSE has fallen already. If we cannot control this debt, our recovery will be extremely more painful. The pound is falling against the dollar. Perhaps Jim Rogers was right.
David Cameron's response was brilliant. He completely tore Brown a new one. The claims to prudence are dead. 16 years of economic growth with record tax receipts and a benign world economic environment, and yet Brown runs up the biggest budget deficit in the developed world, and it was already the fourth highest before the crisis began. All claims to stability are dead with the fastest rising unemployment in the developed world. CPI inflation is still way over target. I bet Brown wasn't banking on that when he changed the inflation target from RPI to CPI, thus preventing the Bank of England to raise interest rates in 2004 when it needed to in order to pour water over the developing credit boom, which then was a candle, but is now a forest fire. He still preaches that unlike the 90's we have low interest rates. The artificially low interest rates across the world have helped to bring about this crisis. Brown will probably think deflation is a good thing and he will say, ''Under the Tories it reached 10%, under Labour it is -4%.''
I can't believe Darling believes London will remain a centre of global finance when he has announced a very punitive and unfair tax regime. What he should have done is to have cut spending and use the money saved to raise the personal allowance to £12,000, thus talking 7,000,000 out of tax altogether. That would have provided an excellent stimulus to the economy, all without extra borrowing. He could have announced that he would cut corporation tax for small, medium and large business, and he should have abolished National Insurance by cutting spending. If we had risen spending in line with inflation, we'd have been spending around £450 billion a year. We could cut £100 billion and use it to fund a massive program of tax cuts. It will prevent the so called deflationary pressures we are facing. It would provide a massive stimulus to aggregate demand, and the supply side would receive a massive boost. The increased tax receipts from growth could be used to fund the services we seem to love.
The fact that Captain Darling believes we will have 3.5% growth in 2001 shows the dreamland he and Brown live in. Brown's forecasts were legendary for their obfuscation and just plain damn inaccuracy. The growth forecasts were just full of piffle. This was a budget designed to target Labour's core vote, and they want to punish someone for being rich and successful.
This is the blog of a free market fundamentalist, a neoliberal, a cruel capitalist, or any other pejorative you can think of to describe someone who believes in a small state, a free market economy and paleolibertarianism. This blog will comment on domestic politics, economics (monetary and fiscal policy), foreign affairs and music.
I am a right wing libertarian. I would describe my politics as Thatcherism in the fast lane. In terms of social policy, I am culturally conservative, which forms the ''paleo'' prefix in my libertarianism. I am a monarchist. Economically, I am an advocate of the Austrian School. I believe in sound money. I advocate a prudent fiscal policy which entails controlled public spending, low taxation and an economic environment that facilitates business, large and small. I am an advocate of a partial gold standard and the abolition of the central banks. I am pretty much the junior version of Ron Paul.