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April 2013

Dear God I despise this argument

The idea of earning £10,000 of income tax, as anyone who\’s working will do from next April, sounds utopian in its generosity. For HMRC it\’s the public relations opportunity of a lifetime. Imagine the adverts: your first £10,000 – tax-free! And you don\’t even have to worry about how we\’re going to pay for your denuded public services.

Yet isn\’t the idea of 3 million people working hard and not being required to pay tax a recipe for their disenfranchisement? The Liberal Democrat segment of the coalition is most likely to see a high tax-free allowance, which goes up to £9,440 on 6 April, as a step towards the goal of a \”citizen\’s income\” – a no-strings basic payment from state to individual over and above any earned (and therefore taxable) income.

A fundamental component of citizenship, however, is paying towards the ongoing work of building and maintaining resources for everyone to use.

All inside the State and nothing outside the State.

Let\’s take this argument to its logical conclusion. The existence of any form of personal tax free allowance disenfranchises people. Not that they lose their vote or anything, they just lose that warm glow of contributing to Islingtonian diversity adviser salaries.

Complete cock of course.

Tax is a necessary but painful corollary of having government. And yes, we do need to have that. In a just and righteous world the rich would pay all the taxes to provide the government. This would of course mean that we could only have enough government that the rich could afford to pay for: that\’s where our Laffer Curve comes in. You do get to a tax rate where higher rates bring in less cash. Thus there is a limit to the size of government you can have if the rich are paying for it all.

And as the running dog capitalist pig dog that I am I\’m just fine with the idea that we should tax those on above median incomes at that Laffer Curve peak rate. Which is around that 45% or so of income that the rate is at currently. And then exempt all income below median income (mid £20ks somewhere) from both income tax and NI. Works for me. That there will be fewer Islingtonian diversity advisers is a feature not a bug of the plan. Let\’s have the government that the rich can afford to pay for.

But I\’m afraid that I really do hate this appalling argument that the poor must pay income tax because……well, because all must worship the State I think it is, isn\’t it?

Which leads me to a data request. I cannot immediately see that this is out there via Google. So if anyone is bored, or bedridden or something, would they like to dig around to produce it? Britmouse maybe?

What we want is a plot of median wages against the income tax and NI allowance. The income tax allowance was 50% (or whatever) of median wages in 2008, say, and it was 100% of median wages in 1950 (or whatever, say). And the same for each year post war (that would be enough I think).

For the basic fact of what has happened is that successive Chancellors have used fiscal drag to pull ever more poor people into the tax net. This current rise to £10k, the hoped for rise to £12.5k, this is just remedying the thievery of generations of politicians.

Anyone care to make up that chart?

Polly\’s guide to change in the NHS

Until now care was bought mainly from NHS hospitals, community trusts or independent GPs (not companies running GP services). But the purpose of CCGs is to bring in maximum competition. NHS services will find themselves bidding against the likes of Virgin Care or the American giant United Healthcare, which are likely to cherry-pick easy and profitable services – diagnostics, routine pre-planned surgery and simple treatments – leaving behind A&E, the frail, the old and anything that is unpredictably expensive.

That sounds sensible. Let market competition work where market competition can and not where it cannot.

If they succeed, more hospitals will go bankrupt.

So we are therefore admitting that NHS hospitals are less efficient than the private providers they will be competing against then? After all, you don\’t go bust if you are more efficient, do you?

That\’s scaremongering, the government protests, and yet the government\’s own figures show what\’s already happening: NHS Financial Information 2013 reports that private patient income earned by UK NHS trusts rose by 5.3%, and London specialist hospitals\’ private business rose by 15%. On a different ideological path, Scottish NHS private practice fell by 18%, and Welsh by 8%.

Market segmentation through product differentiation. Standard business practice. You make sure that you\’re offering more than just one level of service. Thus you can shake more money out of those willing to pay while keeping the custom of those not willing to pay extra. VW does it by building the VW Touareg, the Audi whatever and the Porsche Cayene on the same basic platform. Starbucks, famously, did by offering for the barista to stir your sugar into your iced tea for an extra 50 cents. You get more cash out of those willing to pay more cash by offering them something perceived as being different.

So, NHS England is managing to squeeze extra cash out of the rich for exactly the same health care (even if a better bed or nicer food) that the poor are getting. This is good isn\’t it? More cash for the NHS? As opposed to that different ideological path where all must be equal therefore there is less total cash to pay for health care?

What works has been integration and co-operation across silos, as in cancer or coronary care. What works is washing hands, bringing cleaners back in house, collecting evidence, sharing best practice, not wasteful turf-war competition.

Health is not a market.

And Polly still doesn\’t get the most basic point about markets. They are a coordination, cooperation, mechanism.

We all actually agree that it would be lovely if you could take 1.4 million people and £100 billion and more a year and just \”make it work\”. But you need a system to do that. Stalinist top down control simply does not work in an organisation of that size. It works just fine in a family of course (although note that it\’s very rarely the paterfamilias who exercises the power. Mater always has much more) but as we scale things up such direct control just does not work. Even voluntary, communal, cooperation (as Elinor Ostrom found out) begins to fail once you go above a few thousand people.

Setting targets leads to those absurdities like ambulances waiting outside emergency rooms so that the 4 hour target is met.

At larger scales you simply have to bring markets in. Their incentives, their prices, become the great calculating engine which informs us about who should be doing what to whom where and when. We humans just have not found anything else that operates at such scale.

It\’s not all about enriching the private sector. Not all about allowing the capitalists to run off with the peoples\’ money. It is simply that we do not know any other method of running such a large \”thing\” with any semblance of efficiency.

Which is, of course, why France, Germany, Sweden, Norway, Denmark and all the rest run their health services on pretty much the model that the Bastard Tories are bringing to the NHS.

And on those disability claims

Finally, among those who should have known better who uncritically repeated the claim, Tim Worstall deserves special mention https://www.timworstall.com/2013/04/01/interesting-number-eh/?utm_source=twit… simply because he accused another blogger, and indeed all \’lefties\’, of being \’lying scumbags\’ https://www.timworstall.com/2013/04/01/yes-of-course-lefties-are-lying-scumba… while failing to locate, let alone understand, the original data.]

Sadly, no.

Steve Walker\’s claim was that Shapps must be wrong because the official figures only go up to 2009. This is not true. Therefore Steve Walker was wrong in his specific claim.

Whatever else has happened to benefits and the number claiming them does not change this simple point. Walker depended on a misreading of the statistics as the central core of his logical argument. He was wrong in doing so.

Just to repeat this. Walker looked at the landing page for the statistics and saw this:

Geographic coverage: Great Britain

Time coverage: 2002 to 2009

Type of data: Administrative data
Then he concluded that since the numbers only went to 2009 then Shapps must be, could only be, wrong.

However, downloading the actual statistics, rather than relying upon the landing page, gives you numbers up to May/August 2012 (depends upon which series you look at). Thus, and I repeat this again, Walker is wrong in the \”fact\” that he uses as the centre of his logical argument.

But of course Mr. Monbiot

Last week I ran a small online poll, asking people to nominate inspiring, transfiguring ideas. The two mentioned most often were land value taxation and a basic income. As it happens, both are championed by the Green party. On this and other measures, its policies are by a long way more progressive than Labour\’s.

Given that I have been arguing for both….indeed, you could get most of the ASI and a goodly chunk of UKIP to sign up to both…..that makes us all more progressive than Labour, doesn\’t it?

You might think this a strange place for a neoliberal capitalist pig dog like myself to end up but there is one thing you\’ve got to understand about \”the left\” in the UK. Its incredible, quite astonishing, conservatism.

Half of them are still pining for the revolution of the proletariat when most of the country is already bourgeois by any reasonable measure, the other half pines for union corporatism when, outside the public sector, we\’ve not really got any unions left. Respectively, they\’re looking back a century and a half and half a century.

British politics really doesn\’t make any sense at all until you understand that the Labour Party is almost certainly the most conservative institution in the country.

BTW: Milton Friedman supported LVT and actually worked on ways to bring about a cbi (his version was the negative income tax which morphed into tax credits. But the aim was indeed a cbi which was affordable) so that makes Friedman more progressive than the Labour Party too, doesn\’t it?

Polly should like this on the minimum wage

Minimum wage could be frozen or cut if it starts to cost jobs or damage economy, Government suggests
The minimum wage for millions of people could have to be capped or frozen in future if it risks damaging jobs or the economy, the Government has said.

What they\’re really saying is that the Low Pay Commission must check the impact on unemployment of any rises in the minimum wage. And take them into account when setting it. Which could lead to freezes….even, theoretically, falls…in the rate they set.

Now Polly won\’t of course, come out and say she supports this. However, I do recall one of her Guardian columns saying that the minimum wage should continue to rise: until we see problems with it. At which point we can freeze it or lower it. If anyone\’s bored enough they can check back through her archive to try and find it.

Thus Polly should support a distinct instruction to look for possible employment damage done by the minimum wage so that this can be done if necessary.

As to the main feast here, yes, of course some damage is done by the minimum wage. For the current adult minimum wage it\’s not much. But for the current youth minimum wages it\’s quite a lot.

The general rule of thumb is that a min wage over 45% or so of the average wage causes significant damage. One under 40% doesn\’t (for the blindingly obvious reason that very few people ever get paid below 40% of average wages). Current adult minimum wage is in the 40-45% gap. Current youth minimum wages are in the 60-70% ranges of youth average wages.

This is one (but by no means the only) reason for significantly higher youth unemployment than adult.

I\’m unconvinced that anyone will ever try to cut the youth minimum wage, however beneficial it would be. But they might freeze it.

Further on Steve Walker\’s claims

The government’s latest statistics on some aspects of disability claimants does, of course, go up to the recent past. But the government’s statistics on the drop in claimants when Incapacity Benefit (IB) was replaced by Employment Support Allowance (ESA) only goes to 2008.

Sigh.

IB statistics go to Aug 2012.

They show a drop of 900,000 from 2010 t0 2012.

That was (and is) my ‘entire case’. If Mr Worstall is able to show that to be untrue, he should do so

Yes of course lefties are lying scumbags: why do you ask?

Or if they\’re not lying scumbags then they\’re either innumerate or entirely incapable of actually looking up numbers.

So, via Ritchie, we get this:

Today the Telegraph reported a government claim that 900,000 people had given up disability allowance claims because of the threat of medical examinations. The clear implications was that this was the result of their ATOS medical system and their drive towards a Universal Credit system.

The Tories said all these people claimed benefits because Labour encouraged them to do so.

A thorough left wing researcher called Steve Walker has also shown today that this is a straightforward lie. Not a bit of a lie but a complete and utter total fabrication of a lie. The sort only Gobbels would have thought he could have got away with it is so big.

Steve Walker looked at an MSN version the story and traced the data source. The data relates to be period 2002 to 2009, before the Conservatives came into office.

Oh. Gosh!

So, let\’s look at Steve Walker\’s post.

The government’s ‘latest figures’ currently go up to 2009 – the year before the coalition government took office.

Ooooh, my. So I click through to the page he links to and find:

Geographic coverage: Great Britain

Time coverage: 2002 to 2009

Type of data: Administrative data

And I think, hmm, that\’s a bit strange. The Government will have data on disability payment claimants a little more recent than that. They must do, they write the cheques after all.

So I actually went and downloaded the data set itself.

benefit claimants – disability living allowance
ONS Crown Copyright Reserved [from Nomis on 1 April 2013]

sex Total
item name all entitled cases
age Total
duration Total
condition any disabling condition

Date Great Britain England Wales Scotland England and Wales Great Britain and abroad Abroad (outside GB) Overseas (outside GB) or unknown
August 2002 2,471,650 1,995,090 203,170 273,380 2,198,270 2,473,960 – 2,310
August 2003 2,590,960 2,091,820 212,520 286,610 2,304,340 2,593,270 – 2,320
August 2004 2,690,470 2,173,470 219,690 297,310 2,393,160 2,692,910 – 2,440
August 2005 2,768,160 2,237,510 224,590 306,050 2,462,110 2,770,790 – 2,630
August 2006 2,833,670 2,292,910 228,110 312,650 2,521,020 2,836,320 – 2,660
August 2007 2,930,600 2,376,320 232,950 321,330 2,609,270 2,933,180 – 2,580
August 2008 3,020,700 2,453,320 237,460 329,930 2,690,770 3,023,770 – 3,070
August 2009 3,119,290 2,537,590 241,780 339,920 2,779,370 3,122,750 – 3,450
August 2010 3,200,540 2,609,180 244,740 346,620 2,853,910 3,204,280 – 3,740
August 2011 3,246,880 2,652,740 245,560 348,590 2,898,300 3,251,180 – 4,300
August 2012 3,296,380 2,698,340 246,300 351,740 2,944,630 3,301,050 – 4,680

So, err, the information goes up to Aug 2012 then.

 

I will agree that I cannot see any mass fleeing of disability allowance in those figures. But it does rather explode Walker\’s insistence that the figures only go up to 2009, doesn\’t it?

So there we go, Walker gets to shout and scream that:

\”The Tories and their press allies are past masters at stripping away the context so they can use the resulting distortions to attack their victims with impunity or even the approval of an ignorant public.

It’s shameful. Damnable. Criminal.

And entirely typical of the odious bunch of worms and snakes who are pretending to run the country while lining the pockets of their friends and backers.\”

And Ritchie can say:

So what do we learn?

First the Telgraph lies.

Second the Tories lie, blatantly.

Third, whatever problem there was Labour had solved it. Whatever has happend since is victimisation and bullying.

Last, IDS will do anything to abuse people, ably backed by Cameron, Osborne, Clegg, Alexander and the mass of their MPs.

To describe what is happening now as a propaganda driven programme of victimisation by organised hatred sounds melodramatic, but it\’s also the truth.

I am ashamed that these people have power in this country.

And all because a civil servant (you know, one of those necessary to make the Courageous State a reality) has updated the figures as he was supposed to but forgotten to tell everyone so on the landing page.

Ho hum.

There is a larger point here too. Don\’t forget, these people on the left are the ones who insist that it is possible to understand the economy sufficiently in real time to be able to plan it. We know enough, have good enough statistics, to be able to work out how to manage things through the political system.

And yet they are incapable of checking to see whether a statistical series goes to 2009 or 2012. Doesn\’t give us all a lot of hope about their numerical or planning ability, does it?

BTW, given that Walker\’s \”finding\” is indeed that the numbers only go to 2009, that\’s his entire case, numbers that we now know go all the way to Aug 2012, a wondrous prize for the first person to spot a walkback by any of these oh so outraged innumerate lefties.

To such lefties: please note that I\’m not defending, here, ATOS, calling all those on benefit layabouts. The response \”But all Tories are bastards anyway\” will probably have me agreeing with you. This is not the point here.

Walker\’s entire case is that the figures only go up to 2009. This is not true. Therefore Walker\’s case is false.

 

 

 

Interesting number, eh?

And almost 900,000 have dropped their claim to the taxpayer-funded benefits rather than undergo a new medical test as part of the Coalition welfare reforms.

We all knew that the various incapacity/invalidity benefits were being used as a way to disguise unemployment. It\’s been something of a deliberate policy since Maggie\’s day.

But the numbers do seem to be quite large, don\’t they?

And there\’s good economic reason to get them back onto Jobseekers\’ too. No, not just because it\’s a lower amount of money. Because as and when the economy starts to boom again (yes, it will, at some point) how much growth we can have before we get inflation will be, in part, determined by how long it takes to exhaust that reserve army of the unemployed. And people who are on disability, not Jobseekers\’, are not part of that reserve army.

Do note this isn\’t the analysis of some hateful neoliberal capitalist pig dog. This is M\’Lord Layard, Labour peer extraordinaire.

Having a million odd people completely removed from the labour force on disability limits growth in hte future. Having them in the labour force, even if only theoretically, will increase the growth we can have when it does return. It\’ll make out children richer that is.

Well, we knew the lights were going to go out, didn\’t we?

Government to appoint \’Lights Tsar\’ to get Britain switching off
Ministers are stepping up efforts to cut Britain’s energy usage ahead of a looming power crunch, with the creation of a taskforce charged with switching off the country’s lights.

Ghastly little jobsworths marching around the country shouting \”Put that light out\”.

The last time it was because of Mr. Goering and his fascist Luftwaffe. Today it\’s because of Caroline Lucas and the econazis.

Plus ca change, c\’est la meme chose, eh?

This could, of course, be a story only for today.

The Guardian Glass story is theirs I think?