There's a word for what our democracy has become: oligarchy.
It's not often I disagree with Chris over at Stumbling and Mumbling. You can chortle all you like at Charles Moore declaring David Cameron to have been caught in the wealth trap, but it's a useful phrase, he writes. And of course to a degree he's right, you can be trapped by any number of circumstances of your birth, although it's a hell of a lot easier to dispose of the wealth you inherit than it is to escape being born into poverty.
While Moore may be pleading for understanding of Cameron's position, his not as bright colleagues elsewhere in the media and within the Tories are instead asking for sympathy. Both the Mail and the Telegraph today ran leaders denouncing the iniquities of inheritance tax, the tax which as Moore himself points out was paid by only 17,917 people who died in 2012-13, out of the 500,000+ whom passed on. Their real beef was that Cameron had received further criticism for having been given a £200,000 gift from his mother, another of those perfectly legal tax planning moves, described as an "equalisation" by Downing Street. Joylon Maugham might have declared this to be tax avoidance, but practically no one else in the industry dedicated to just such planning does. Funny that.
Here, finally, is what a week of coverage of the Panana Papers has been leading up to. Most of the Tory press was happy to see Dave taking a beating at first as they believe it will damage him vis-a-vis the EU referendum campaign, where Dave effectively is the remain campaign. Once it gets into the realm of all politicians having to publish their tax returns, which in turn leads to demands that those sneering from the sidelines also get their self assessments out for the lads, it's clear this cannot be allowed to continue. When the questions move on to lump sums gifted in the expectation of income tax not needing to be paid, then the squealing really starts to begin. Then we hear the cries about the politics of envy, about the enemies of wealth creation, that this is really about how "they hate anyone who has got a hint of wealth in them", and that if we're not careful, we'll have a parliament full of "low achievers".
Poor little rich people. All they want is to look after their families. What could be more natural than that? Why should both they and their children be punished when bequeathing vast sums, property and all the rest when they go to meet their maker? Isn't this income being taxed twice over? Isn't opposing this in fact opposing aspiration? Don't we all want to make good by our kids? Why in short, does the left and Labour hate our freedoms?
Once the right was just as indignant about unearned wealth as the left. Alan Clark might have judged another Tory sneering at Michael Heseltine as the type who had to buy his own furniture as cutting but snobby, yet there was also concern about what the passing on of vast sums and houses encouraged. Not more hard work, but indolence, idleness. Now David Cameron declares that there is nothing more natural than wanting to pass on your home to your children. This only applies obviously to those who own their home, while everyone renting or even more shockingly, in what remains of social housing, should expect at any minute to be turfed out. Earning more than you once did? You're going to have to pay to stay. Have a spare bedroom? We'll deduct that from your benefits if you don't downsize, even if there isn't anywhere to downsize to. Want to live near to where your family and friends are? Tough luck if that'll breach the benefits cap; you'll have to move somewhere cheaper. Unable to so much as put down a deposit thanks to the paradox of astronomical rents? I feel your pain, says the prime minister renting out the Kensington home bought with the help of dad and a previous inheritance from an aunt for over 90 grand a year.
Over £90,000 a year just in rent. Alan Duncan ought to be careful about who he describes as "low achievers", as Dave by many yardsticks would fall into the category. About only one proper job, and that as PR for Carlton. Remember that by the standards of Dave's set, he and Osborne are relative paups, George made to describe himself as a "despicable cunt" for having gone to St Paul's rather than Eton. To most people this a world beyond imagination, where some will be lucky to earn in a decade what Dave pulled in from rent in a year. This is the world that the Mail, Torygraph and Dave want to defend at all costs, where "aspiration", something the middle classes do, is pulled out to defend the ultra rich forever living in the style to which they have become accustomed. The inheritance tax threshold might be rising to a million, to the point where practically no one will pay it, yet still at the smallest hint that gifts might come under suspicion the cry goes up.
Without using the word, what Adyita Chakraborty so accurately described in his Graun piece this morning is oligarchy. Sure, we hear fine words every so often about social mobility, and of course a few of the best and brightest rise to the top while some squander their inheritance, falling down the pecking order, but otherwise when it comes to wealth the Tory party could not be more dedicated to conservatism in its truest sense. Almost every move on the tax and welfare fronts since the Tories came to power in 2010 has been to screw the poorest, throw the odd bone or two to the middle to give the impression they're on their side, and ensure the top stay at the top.
In this if nothing else the right-wing media is completely on side. They too claim to be standing up for the middle while working, literally, for the top. It was instructive whom the prime minister chose to mention in his statement today in a dig at the media. It wasn't the weirdo Barclay twins hidden away at their flat pack castle on Brecqhou he dropped, or Jonathan Harmsworth, aka Viscount Rothermere, the non-dom head honco at the Mail. No, it was the BBC, the Graun and Islington council who were brought up for investing in offshore funds.
The impression this is meant to send is clear. Everyone's at it. Nothing to see here. Except we're not all at it. Most of us do though dream of having enough spare cash lying around to be able to squirrel it away hidden from HMRC, so for plenty that will be enough. The belief is those still not sated can be dismissed as simply jealous, envious, as so twisted in their politics that they would rather do right by the state than by their family. Perhaps it will hold for a while.
Yet a crunch is coming. A point is going to be reached when it becomes clear just how loaded the system currently is. It might take another crash, but it's going to come, such are the frustrations that are without question building and every so often find expression in outbreaks of anger like the one seen over the past week. And when it does, no amount of pleading, appeals to authority or media attempts to push back against it are going to quell the demands for fundamental economic recalibration. A smarter political class would see what's on the horizon, and act now. This for the most part is not a smart political class.
While Moore may be pleading for understanding of Cameron's position, his not as bright colleagues elsewhere in the media and within the Tories are instead asking for sympathy. Both the Mail and the Telegraph today ran leaders denouncing the iniquities of inheritance tax, the tax which as Moore himself points out was paid by only 17,917 people who died in 2012-13, out of the 500,000+ whom passed on. Their real beef was that Cameron had received further criticism for having been given a £200,000 gift from his mother, another of those perfectly legal tax planning moves, described as an "equalisation" by Downing Street. Joylon Maugham might have declared this to be tax avoidance, but practically no one else in the industry dedicated to just such planning does. Funny that.
Here, finally, is what a week of coverage of the Panana Papers has been leading up to. Most of the Tory press was happy to see Dave taking a beating at first as they believe it will damage him vis-a-vis the EU referendum campaign, where Dave effectively is the remain campaign. Once it gets into the realm of all politicians having to publish their tax returns, which in turn leads to demands that those sneering from the sidelines also get their self assessments out for the lads, it's clear this cannot be allowed to continue. When the questions move on to lump sums gifted in the expectation of income tax not needing to be paid, then the squealing really starts to begin. Then we hear the cries about the politics of envy, about the enemies of wealth creation, that this is really about how "they hate anyone who has got a hint of wealth in them", and that if we're not careful, we'll have a parliament full of "low achievers".
Poor little rich people. All they want is to look after their families. What could be more natural than that? Why should both they and their children be punished when bequeathing vast sums, property and all the rest when they go to meet their maker? Isn't this income being taxed twice over? Isn't opposing this in fact opposing aspiration? Don't we all want to make good by our kids? Why in short, does the left and Labour hate our freedoms?
Once the right was just as indignant about unearned wealth as the left. Alan Clark might have judged another Tory sneering at Michael Heseltine as the type who had to buy his own furniture as cutting but snobby, yet there was also concern about what the passing on of vast sums and houses encouraged. Not more hard work, but indolence, idleness. Now David Cameron declares that there is nothing more natural than wanting to pass on your home to your children. This only applies obviously to those who own their home, while everyone renting or even more shockingly, in what remains of social housing, should expect at any minute to be turfed out. Earning more than you once did? You're going to have to pay to stay. Have a spare bedroom? We'll deduct that from your benefits if you don't downsize, even if there isn't anywhere to downsize to. Want to live near to where your family and friends are? Tough luck if that'll breach the benefits cap; you'll have to move somewhere cheaper. Unable to so much as put down a deposit thanks to the paradox of astronomical rents? I feel your pain, says the prime minister renting out the Kensington home bought with the help of dad and a previous inheritance from an aunt for over 90 grand a year.
Over £90,000 a year just in rent. Alan Duncan ought to be careful about who he describes as "low achievers", as Dave by many yardsticks would fall into the category. About only one proper job, and that as PR for Carlton. Remember that by the standards of Dave's set, he and Osborne are relative paups, George made to describe himself as a "despicable cunt" for having gone to St Paul's rather than Eton. To most people this a world beyond imagination, where some will be lucky to earn in a decade what Dave pulled in from rent in a year. This is the world that the Mail, Torygraph and Dave want to defend at all costs, where "aspiration", something the middle classes do, is pulled out to defend the ultra rich forever living in the style to which they have become accustomed. The inheritance tax threshold might be rising to a million, to the point where practically no one will pay it, yet still at the smallest hint that gifts might come under suspicion the cry goes up.
Without using the word, what Adyita Chakraborty so accurately described in his Graun piece this morning is oligarchy. Sure, we hear fine words every so often about social mobility, and of course a few of the best and brightest rise to the top while some squander their inheritance, falling down the pecking order, but otherwise when it comes to wealth the Tory party could not be more dedicated to conservatism in its truest sense. Almost every move on the tax and welfare fronts since the Tories came to power in 2010 has been to screw the poorest, throw the odd bone or two to the middle to give the impression they're on their side, and ensure the top stay at the top.
In this if nothing else the right-wing media is completely on side. They too claim to be standing up for the middle while working, literally, for the top. It was instructive whom the prime minister chose to mention in his statement today in a dig at the media. It wasn't the weirdo Barclay twins hidden away at their flat pack castle on Brecqhou he dropped, or Jonathan Harmsworth, aka Viscount Rothermere, the non-dom head honco at the Mail. No, it was the BBC, the Graun and Islington council who were brought up for investing in offshore funds.
The impression this is meant to send is clear. Everyone's at it. Nothing to see here. Except we're not all at it. Most of us do though dream of having enough spare cash lying around to be able to squirrel it away hidden from HMRC, so for plenty that will be enough. The belief is those still not sated can be dismissed as simply jealous, envious, as so twisted in their politics that they would rather do right by the state than by their family. Perhaps it will hold for a while.
Yet a crunch is coming. A point is going to be reached when it becomes clear just how loaded the system currently is. It might take another crash, but it's going to come, such are the frustrations that are without question building and every so often find expression in outbreaks of anger like the one seen over the past week. And when it does, no amount of pleading, appeals to authority or media attempts to push back against it are going to quell the demands for fundamental economic recalibration. A smarter political class would see what's on the horizon, and act now. This for the most part is not a smart political class.
Labels: David Cameron, economics, inheritance tax, Panama Papers, politics, tax, tax avoidance, Tories
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