Wherein we observe that people on right and left of political spectrum don't have a clue about logic or maths:
Allister Heath in CityAM: There is no way that the welfare state, as presently structured, can continue: the middle class will no longer be able to rely on free public services for ever; European-style co-payments are inevitable. Osborne will come of age tonight; he mustn't blow it.
*sigh*
Public services are not 'free' and certainly not to the 'middle classes'. They pay their taxes into a big pot and then the state pays for more-or-less universal public services which are free at point of use.
There is an insane idea doing the rounds that we can reduce the deficit, and hence reduce future tax bills, by reducing 'middle class benefits'. How's that going to work? Let's say we tell parents that in future the 'free' state education place for their children will be means tested - for example, for every £5,000 income the parents have (over and above the subsistence level), the parents have to pay an additional ten per cent towards their child's education, and that this enables us to cut income tax by ten per cent. So a household earning £50,000 saves (say) £4,400 tax a year; but they have to pay sixty per cent of the cost of their child's state school place, call it, er, £4,400 a year.
How does that make them any better off? Is that not exactly the same thing as funding education out of general taxation, except with extra layers of form filling, means testing and opportunities for fraud and error?
*/sigh*
(It is of course an entirely separate debate as to whether the state should be involved in the provision of education in the first place; and if we were to shut it down, whether we'd replace it with education vouchers or tax cuts.)
From the BBC: Brendan Barber, general secretary of the Trades Union Congress (TUC) union, said the cuts [in public spending] would cause more longer term problems and would not reduce the deficit. He said: "What happens is when more people become unemployed, they're paying less tax into the exchequer and they're a drag on the public purse rather than contributing to the public purse. These kinds of cuts will make the deficit worse."
*sigh*
IF we can identify unproductive public sector workers THEN they ought to be sacked. IF (their current net salary + pension accruals) > (the redundancy pay + unemployment benefit they will receive) THEN this reduces the deficit. In fact, even if this calculation showed a nominal loss, it might still be worth doing because they can then get a job in the productive sector and become proper, net taxpayers
In any event Public sector employees do not really pay income tax, as it is the government who gives them the gross salary; the government who takes away some of that gross salary in tax; and the government who promises them future pensions (the value of the pension accruals is roughly equal to the tax that is nominally deducted); and Timmy Taxpayer picks up the net cost.
*/sigh*
Sounds Like, For Once, It Went Right!
3 hours ago
5 comments:
That's exactly what struck me. Public sector pay is from taxation and public sector income tax is just circulation of money which ultimately derives from taxes on busineses and those employed in the wealth creating private sector. The trades union boss pontificating about this is just showing his ignorance. He also better be careful as many of us will not notice if his members go on strike.
Last para - replace 'government' with 'taxpayer in private business', or just 'taxpayer' if you prefer.
Ch, if public sector trade unions say it, fair do's, that's their job; and it's our job to make fun of them. But the right wingers make very similar mistakes.
L, good point, I have amended.
If they wanted to save money on education, they could lower the leaving age.
B, indeed, that's all in the MW manifesto. Provided of course that there's easy access to very low-cost adult or evening education for those that regret it a few years later.
Post a Comment