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Jewish World Review
Nov. 27, 2008
/ 29 Mar-Cheshvan 5769
The return of British socialism
PORTSTEWART, Northern Ireland British Prime Minister Gordon Brown, like legions of politicians before him, has broken a campaign promise not to raise taxes and will do so on the citizens of the United Kingdom in April 2011, that is, if the governing Labour Party is re-elected. Those earning between 40,000 and 100,000 pounds ($61,335 to $154,000USD) will pay an average of 156 pounds ($240USD) more in tax per year. According to The London Times, Brown also proposes to raise taxes on the already burdened "wealthy." Those earning "150,000 pounds ($230,000USD) will pay an extra 3,000 in tax. Someone earning 200,000 pounds ($307,000USD) will pay an extra 5,000."
Brown says the money will be used to pay for the heaviest borrowing in Britain's history. Within five years, Britain's debt will be equivalent to more than one-half the nation's entire gross domestic product. According to the Conservative Party, Britain is borrowing more money, in real terms, than the credit it received from the United States to fight World War II. The Value Added Tax will be reduced but by a paltry 2.5 percent in the highly problematic hope that the pocket change saved by consumers will drive them into shops for Christmas shopping.
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Under the Brown proposal, the Times reports, "people earning more than 100,000 pounds a year will have their personal allowances cut in half, and those earning more than 140,000 pounds ($215,000USD) will have them removed altogether."
Clearly this proposed tax increase (especially one during a recession) announces the return of the old tax-and-spend Labour Party that was rescued from itself by former Prime Minister Tony Blair. That rescue occurred only after Blair's predecessor, Margaret Thatcher, demonstrated the economic wisdom of cutting taxes and reducing government spending, something as foreign to the old (and now apparently the "new") British Labour Party as a croissant in a fish and chips shop. Under Thatcher (and Ronald Reagan who cut taxes in America), boom times returned to Britain.
More than just income taxes are going up, however. Brown wants to increase taxes on National Insurance (for the second time since Labour returned to power), gasoline, alcohol and tobacco and long-distance air travel. "End of prudence," headlined The Daily Telegraph. "What About Spending?" asked a Times of London editorial, which faults Brown's government for planning to create "thousands of often meaningless posts (jobs) feather-bedded with job security, easy hours and generous pension entitlements." These government jobs, notes the Times, often pay more to retirees than private pensions.
Brown calls his approach the "fairness agenda," which sounds very much like the language used by liberal Democrats in America. What is "fair" about penalizing the productive and robbing them of the incentive to work harder and take risks, while subsidizing those who seemingly do not wish to work harder, or take risks? Is it fair to send out government checks drawn on someone else's bank account? If you or I write a check on an account not our own, we would go to jail. But when government does it, that is supposed to be admirable.
No economy can sustain this level of borrowing while keeping spending high and increasing taxes. Building dependence on government is how politicians steal additional power for themselves. The more people become addicted to and come to depend upon government, the greater need they will have of politicians to keep the money flowing. This isn't just vote buying. It is a type of people buying reminiscent of the slave trade. Government is the new master and citizens of Britain and America are rapidly becoming their slaves.
Britain's most famous writer, William Shakespeare, is named in the King's Remembrancer Subsidy Roll as a tax defaulter in Bishopgate ward for failing to pay an assessed 5 shillings. Perhaps old Will was onto something. At what point will the British and American taxpayers say "enough!" and revolt, refusing to pay any new taxes until these governments stop wasteful and "entitlement" spending, which is robbing us of the principles that built our countries into once-great financial powerhouses?
At a news conference Tuesday, president-elect Obama pledged to end wasteful spending, including some farm subsidies. But discretionary spending amounts to only a small fraction of the government's proposed 2009 budget. The real need is to reform entitlement programs. Will he? He hasn't yet said.
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