No it won\’t

Nick Clegg\’s plans to cut taxes for low-paid “alarm clock Britain” would cost £4.3 billion

This is more than just a linguistic error, it\’s a category error.

Reducing the amount of money taken out of peoples\’ pockets does not have a \”cost\”. For the cost is itself the taking money out of peoples\’ pockets. The cost of politicians, of the State, is that money taken.

If this cost is reduced then we cannot say that this is a cost: this is a reduction in costs, not an increase. The correct phrasing is thus:

Nick Clegg\’s plans to cut taxes for low-paid “alarm clock Britain” would reduce costs by £4.3 billion

7 thoughts on “No it won\’t”

  1. oh come on, it’s quite unremarkable to talk about how much tax cuts “cost” … i.e. we could give a tax break to industy X, that would cost us Y in forgone revenue.

  2. Costs are always costs to someone or something. So, in the original statement, insert ‘the Exchequer’ before ‘£4.3bn’; and in your revision, insert ‘to those taxpayers’ before ‘£4.3bn’.

  3. Costs are normally associated with a cash outlay (although it can at times be deferred) and not with a reduction of the revenues.

    Alas, Tim is right, there is no cost in a reduction in taxes, neither to the Exchequer nor to anyone else, the Exchequer however has a reduction of its revenues.

  4. Luis Enrique is right that in discussing tax cuts it is unremarkable to talk about ‘costs’, but that merely showcases how the language has been debased. It’s like how Hayek proposed that to prefix anything with the word ‘social’ was to invert its meaning. One of the biggest wrenches in the Gramscian toolbox is to make a word normative.

  5. Emil – I see what you mean in budgetary terms, but, in common parlance, a revenue reduction is a cost.

    To a landlord, his voids are both a cost and a revenue reduction. Sure, in a formal budget, voids would be listed as (say) a 10% revenue reduction rather than as an overhead. But, practically speaking, voids are generally the single largest cost that a landlord faces.

    So we are talking about conventions here, and whether Tim is right or not depends on whether in the context the author was using the term ‘cost’ technically or as in everyday speech.

  6. paul ilc,

    I can sort of agree with you on conventions but the “cost” appears to have been calculated by a think tank of economists. I do feel that economists should be able to distinguish between reduced revenues and costs. Actually I bet that they do but it’s the Telegraph editors that are ignorant

    Furthermore, I’m afraid that your example doesn’t add anything to the example. A foregone revenue is a foregone revenue. If there is no transaction there can be no cost. You can keep on listing as many examples as you want, it’s not going to change the facts.

  7. paul ilc
    Any landlord who thought that would be fooling themselves.The costs are what you have irrespective of having a tenancy + the costs arising from the tenancy. Adding the two together & subtracting the rent can leave you with both a positive number & a wish that you’d never gotten into the letting business in the first place.

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