George Osborne is often portrayed as an arch Thatcherite, he cried at her funeral. But there is one area where he is completely at odds with the Iron Lady. She believed in rewarding success, Osborne believes in punishing it.
Socialist dogma contains a lot of phraseology such as “social justice” and “redistribution” which basically involve the government stealing money from people who have earned it and then giving it to people who haven’t earned it. Yet in every society that there has ever been or will ever be the reward of wealth has been uneven. This is because we are not all the same. Some people have intelligence, enterprise, love of hard work and risk taking, dedication, education and vision. Others don’t. Our society should reward those who contribute most, which it does due to the elegance and success of the free market and capitalism. But then the government steal what has been earned.
Our problem in Britain is that we have had many decades of indoctrination of socialism in our education system and the BBC. Leftism has become the accepted norm. And because of this our society as a whole thinks that it is OK to punish success, just for the sake of punishing success. People seem incapable of thinking this through. If you punish something you will get less of it. And if you reward something you will get more of it. So our whole tax system is engineered to make Britain and everyone who lives here less successful. The left occupy the moral as well as the intellectual low ground. They punish success and reduce government income at the same time.
Our best and brightest have a simple solution to being punished by their government. They leave. They go and contribute to the economies of other countries where they are better appreciated. There are about 5 million Britons living abroad and 300,000 more leave each year, of which a very high percentage are economic migrants escaping punishing British tax rates. Go to Singapore, Monaco, Dubai, Malta, Switzerland, Hong Kong, the Caribbean and many other places around the world and you will find large numbers of highly skilled expatriate Brits. They have bailed out of our greedy tax system and instead pay into far fairer systems. In fact any skilled person who can would be a fool not to go, wealth accumulates a lot more quickly when the state isn’t stealing from you. (See Hong Kong income tax rates by clicking this highlighted text.)
There isn’t even any need for high taxes. The rate is set at a level that will keep the socialists happy with how much other people’s success is being punished. But this rate is actually far higher than the rate at which the government would generate the most income for itself. That’s right, it has been proven repeatedly that higher rates generate less money for the state, mainly because people don’t like being punished, so change their actions to avoid it. This phenomenon is called the Laffer Curve. At 0% tax the government would have zero revenue, at 100% tax it would also have zero revenue. Between these points is a curve of varying revenue levels at different tax rates, this is undeniable, yet governments very rarely use this knowledge to set their tax rates, they prefer ideology instead.
Margaret Thatcher reduced the top rate of tax from 98% to 40%, where it remained for more than 30 years, then on 6 April 2010 Labour increased it to 50% (an act which, due to the Laffer curve, could only reduce government income). They were kicked out of office on the 6 May 2010. So Labour had a 40 % top rate for 13 years and a 50% rate for just one month. This was a political trap, Labour only put the rate up so they could criticise Osborne when he brought it back down! Which they duly did when he reduced it to 45%, despite the fact that this drop increased government income substantially. They would howl again if he reduced the top rate to 40%, despite this being what they had it at for 13 years. And it is not just tax rates, Darling removed personal allowances from high rate tax payers and Osborne has left this immoral punishment in place.
It really is time to stop all this punishment of success, we need all the success that we can get, so we should be encouraging it. We need to get rid of higher rate tax all together and just have the standard rate. The rich would still pay a lot more tax. Estonia (inside the EU) has a flat income tax rate of 20% and their economy is booming on it, why can’t we do this? And the people of Britain need to change their attitudes, success should be rewarded, not punished.
Further reading to expand on the above (click highlighted text to open article).
There are a lot of very nasty people in Great Britain.
Labour want to bring the French disease here.
What is social justice?
Why Osborne must reduce benefits.
How Estonia does it better.
What is socialism. The facts.
Wealth trickle down is fantastic.
Inequality. The facts.
George Osborne is soaking the rich.