CentreForum is hosting an important event today – a wide-ranging statement of the tax policies the Liberal Democrats will present to the public at the next election.  The BBC has already taken the story, leading with the aspect that they are planning to Double the threshold of the Mansion Tax.

While this may raise a billion or two, of far greater significance is the pledge to raise the starting rate threshold for income tax to £10,000.

The plans are being described as “the most radical tax reform in a generation”.  Les Bonner of Grimsby has blogged about it.

Oh, on another topic: am I the only person to point out the irony in this advert of Tiger Woods‘?  I kinda doubt it:

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7 thoughts on “Nick Clegg and Vince Cable due to speak on tax policy at CentreForum event

  1. Hope the launch went well, Giles – pity that in early coverage this morning the redistributive stuff seemed to be overshadowed by the change to level a mansion tax would set in.

    Some time ago, I mentioned Prof Richard Wilkinson – as the other Richard Wilkinson – and his work on the health impacts of inequality.

    I know you are often irritated by Liberator articles but the co-operative have managed to persuade Wilkinson to write something for them this month at
    http://www.liberator.org.uk/article.asp?id=178504115 which is relevant to the need for redistribution.

    I’d also be very interested to know your reaction to some of the charts plotting the effects of inequality in a power point presentation taken from Wilkinson (and Pickett’s) The Spirit Level. The charts/ppt can be downloaded here:
    http://www.equalitytrust.org.uk/resources/slides

    In his work, Wilkinson has suggested that in ‘richer’ countries one of the strongest factors influencing health levels is the stress that comes from ‘social evaluative threats’ – threats to self-esteem or social status.

    This stress is not confined to the poorest because status anxiety affects all, especially (as I tried to argue on Friday) in a meritorious rather than a hierarchical society where social position and status is no longer conferred by birth or attached to ‘post’, but which in the absence of these is communicated by consumption.

    Wilkinson suggests that after a country has tackled the great epidemics (that still ravage developing countries), health is then more affected by the stress from the shame and embarrassment at not having certain goods and services. In more equal developed economies, this stress is less prevalent and so there is a lower incidence of stress related diseases and their consequences for trust levels, social harmony, crime and violence, educational attainment and sustainability. (See charts).

  2. Bill

    My instinctive reaction is:

    Yes, I agree that social feelings of inferiority/relative versus absolute measures of wealth have a large effect upon well being.

    But I am also deeply worried, being a Liberal, about the idea of the government getting involved too far in such matters. I’ve felt jealous of a lot of people over the years, and unhappy as a result. Should the government intervene to make every adolescent equally popular/good at sport/zit-free/etc* in order to alleviate this massive source of unhappiness?

    They fixate on money because, like the economist looking under a streetlamp for his keys, that’s where he can see.

    You seem rather more comfortable with the idea of the govt doing something about things like status anxiety.

    *of course, I was none of these.

  3. Just comfortable, Giles, with the idea of Government doing something about inequality by redistributative measures when it is done for similar reasons to providing state education or the NHS – ie it’s a good, it contributes to the common as well as the individual good, it reduces expenditure elsewhere (on health, policing etc) reduces waste, increases capacity, reduces unnecessary consumption, improves sustainability (and might also assist in raising exports). So I support the £10,000 measure (wish it had been set at least at the level of the minumum wage).
    I am not a Gladstonian, more a Hobhousian or a Hobsonian Liberal.
    B

  4. I suggest you have a look at this relic of a strategy unit paper http://www.cabinetoffice.gov.uk/media/cabinetoffice/strategy/assets/paper.pdf. Layard’s book ‘Lessons from a New Science’ is worth a read as is Sennett’s ‘Hidden Injuries of Class’ for a more sociological examination. Academics and policy have been taking about inequality, health and happiness for quite a while now. It’s only over the last two years it’s managed to get into the public/media sphere mainly due to economists and politicians taking up the argument as it’s quite sexy and it’s easy to design policy to make people happy, for a while at least…Giving a starving man a load of bread! It’s much harder to improve overall life satisfaction and increase social mobility. Besides happiness is a bad measure of societal success (delivering the good life) as it’s too diurnal, i.e., unstable. You could wake up miserable on a Monday morning and be ecstatically happy on a Friday afternoon. As Richard and others note -Marmot, Kawachi et al it’s much better for policy to aim for sustained psychological and physical health improvements amongst a population via poverty reduction.

    I’d also say stress is a bad measure and is yet to be properly understood how a psychological process has a bio physiological effect, i.e., increased rates of heart disease. I’d certainly say societies riddled with massive income inequalities do have a negative affect on all of us. The wealthy enclave themselves off in gated communities due to high crime rates, whilst the poor fight amongst themselves and get poorer! There is evidence, however, the more equal societies do also suffer from higher rates of suicide and alcoholism. You ever been to Finland!?

    Anyway Adam Smith talked about all of this in the wealth of nations:
    “By necessaries I understand, not only the commodities which are indispensably
    necessary for the support of life, but whatever the custom of the country renders it
    indecent for creditable people, even of the lowest order, to be without. A linen shirt,
    for example, is, strictly speaking, not a necessary of life. …But in the present times,
    through the greater part of Europe, a creditable day-labourer would be ashamed to
    appear in public without a linen shirt … Custom, in the same manner, has rendered
    leather shoes a necessary of life in England. The poorest creditable person of either
    sex would be ashamed to appear in public without them. … Under necessaries,
    therefore, I comprehend, not only those things which nature, but those things which
    the established rules of decency have rendered necessary to the lowest rank of
    people.”

  5. Thanks, sort of, for the 60 pages of extra reading. Very sort of. swamped wilkes. did you read my post about nervous breakdowns?

    I agree with Smith about relative poverty.

    I hear that Greenland has a suicide rate of 100. Jeez.

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