"It's never happened before, apart from on a regular basis"

... is what my colleague said when we saw this map of the paths of the 1999 and 2013 tornadoes in Oklahoma in The Daily Mail:

Street Art

"Too fat to skydive in Mum's memory"

Story over at Shit London.

'"Park and Skim" still proving a nice little earner for Work Programme Prime Providers' Update

A really splendid "I have of course given back all the money I made from it [not]" The Work Programme is failing the taxpayer piece from  Richard Johnson -  "a special adviser on welfare to work*, former managing director of welfare to work at Serco, and former chief executive of welfare to work provider, Ingeus"** - is now available, in which he agrees with the Select Committee Report.

This stands nicely alongside his The Work Programme's only success is at 'creaming and parking'- in which he explains that it was of course every other prime provider doing this, but not the ones that employed him, and The Work Programme should help the jobless, not contractors in which he rubbishes the DWP's first report on the scheme, and explains that the contracts are set up in a way that makes it really difficult for anyone who isn't or wasn't on the inside to have a clear idea about what is going on.  

* Richard works for the Select Committee in this capacity, alongside being Lead Advisor at ACEVO, the Association of Chief Executives of Voluntary Organisations and Chair at Social Investment Partnerships

** Ingeus obviously agree with Richard. As was pointed out in the G just the other day, Ingeus UK's current chief executive, Dean James, is a former senior DWP civil servant.

"Scottish referendum: Alex Salmond says Scotland can afford a glossy prospectus too"

From the BBC:

Scotland can "more than afford' to publish a glossy prospectus purporting to show it as a successful independent country, its first minister has said.

Alex Salmond was speaking as he launched an obviously very expensive study as evidence of the nation's key economic strengths. He said meeting the costs of preparing the document would not have been possible had his government not been able to draw on the country's strong financial foundations, diverse economy, ingenuity and natural resources.

Scotland's electorate will vote in a referendum on independence next year.The Scottish and UK governments have been vying with each other to publish the glossiest and most expensive document to illustrate their cases ahead of the vote, which will be held on 18 September, 2014.

The latest Scottish government paper, entitled Scotland's Economy: the case for independence, was launched by Mr Salmond and Deputy First Minister Nicola Sturgeon at a JobCentre Plus office in Falkirk.

Home-Owner-Ist, Socialist... or both?

The LVTC blog alerts us to this idiocy from the IPPR (page 20 onwards) 

[my comments in brackets]
-----------------------------------------
Property and land taxes

Despite vocal advocates and their use in several countries as municipal tax, a British property or land tax has serious drawbacks on closer consideration.[that's a lie, or at least, he doesn't list any drawbacks or show that he has given it serious consideration]

Such taxes are limited to single class of assets – albeit an important one [another lie - land rents are not a special kind of income - it's just all the income you can prise out of the productive economy. Without those other wealth creating activities, no land rents].

Economically and fiscally arbitrary, they pass over all other wealth [good] while creating inconsistency driven distortions and avoidance [no, LVT reduces distortion and avoidance - he says so himself later on - what on earth is the man talking about?]. The UK already has high taxes on property usage [outright lie, except Business Rates] and transactions [true but irrelevant and SDLT and CGT are not LVT].

And we have highly skewed land and property ownership, polarised between all-but-monopolistic landed interests held at repressed values and the vast majority buying or renting toeholds of urban property at high, inflated, increasingly unaffordable prices.[that's one of an infinite number of arguments FOR LVT, not against, what a joker]

The danger is the tax hitting lifetime acquired owner-occupied urban property [Poor Widow Bogey alert!] more than the deeper inequalities in property ownership or wealth. [Nonsense, quite the reverse is true] All this then curtail the amounts of tax that can be raised. [the amount LVT could raise is limited by cowardly politicians and other taxes]

Conversely, property can't go anywhere or readily disguise itself.[that's an argument FOR] If all that's wanted is a modest tax to raise limited supplementary revenue to the existing unreformed tax regime,[no that's not all that's wanted] then a property or land tax might be (or at least seem) straightforward and less readily avoided.

Here, a land rather than property tax – say, based on owned acreage according to land type – would be preferable [idiot idiot idiot farmland is only worth a hundredth as much as outer suburban land, which in turn is only worth as much as inner urban land], given the UK's highly distorted property market.

By attaching more to the pure 'rent' ownership component of property, it would have limited impact on incentives or the housing market, while going more to the real nexus of property inequalities. [no that's an argument for proper LVT, not for some insane acreage tax]

Failing that, rather than fiddling around with a necessarily limited additional property tax, one might as well simply extend the existing Council Tax bands, removing the present cap for more valuable properties. [an excellent start] Nevertheless, if real reform is in order then looking to a property tax at all remains ill-advised. [somebody kill this man, quick]

So he's clearly a Homey of the worst sort.

And he is of course a Socialist. On the next few pages he talks blithely about having "The Better Wealth Tax" instead of LVT, while making no attempt to explain how wealth would be defined and measured; how he would prevent massive avoidance and distortions; does not give any sort of moral or economic justification for taxes on vaguely defined "wealth" and completely ignores the fact that an income tax on investment income is mathematically much the same thing as a "wealth tax" in the same way as PAYE is a tax on your truly personal wealth.

'"Park and Skim" still proving a nice little earner for Work Programme Prime Providers'

says House of Commons Select Committee on Work and Pensions 'but that aside, it isn't really delivering much".

Commenting on the report, Dame Anne Begg MP, Chair of the Work and Pensions Committee, said:

"The performance of the Work Programme in its first 14 months was poor. There are signs that it is now improving significantly for mainstream jobseekers. We hope the next job outcome statistics to be published in June will bear this out – we will be very concerned if they don’t."

or: it is quite good at placing those people who would have found themselves a job anyway in work of some sort, as further clarified by Dame Anne who goes on to say

"However, the Work Programme has proved much less successful to date in addressing the problems faced by jobseekers who face more serious obstacles to finding a job – people with disabilities, homeless people, and those with a history of drug or alcohol abuse.

It is clear that the differential pricing structure is not a panacea for tackling creaming and parking. The Government must do more to ensure that the Work Programme provides effective support for all jobseekers, not just the ones who are easiest to help."

The Committee concludes that the Work Programme’s differential pricing structure, which is designed to financially incentivise contracted providers to support those with more challenging barriers to employment, is not having its intended impact on providers’ behaviour.

The hardest to help jobseekers remain at risk of being “parked”—given little or no support by providers who assess them as being unlikely to find sustained work.

or: maybe have a go at removing or toning down the "money for old rope" aspects and get these so called experts actually doing something to try and justify having the programme at all.

Home-Owner-Ist In Chief on top form

From City AM:

Wealth taxes – on property(1), cash, equities and other assets, including unrealised gains – always mean that some people will end up paying more in tax than the amount they earn (2) – while this might sound crazy, it is a feature, not a bug, of the system. The whole point is to make people poorer(3) and to reduce their overall wealth.(4) By contrast, income taxes and other levies on new income – as well as on realised capital gains – only reduce the increase in wealth, rather than seizing previously earned and taxed income (5). There is a big difference between those two approaches.(6)

Yes, this man wants you to vote for a system which makes you poorer, because it enables his sponsors in The City to become ever richer.

A few simple facts which he would never admit:

1) No sane person is proposing a general tax on wealth; they never raise much and collapse under the administrative burden of precisely defining and measuring "wealth". Which is why we have income tax on dividends and interest income, that does much the same job (i.e. if shares yield a dividend of 4% and higher rate income is 25% of the dividend received, that's like a 1% annual wealth tax).

Like all good Homeys, he insists on using "property" as synonymous with "land" and on bracketing in land wealth with private wealth when it is fundamentally different. Land "wealth" is merely a measure of the total annual rental value of land, which as we well know is created by the actions of the whole nation (or even whole continents if the nations in it are not at war). Land rents are national wealth. So a tax on the annual rental value of land does not affect private wealth and can't possibly reduce national wealth, it is just a fair user charge.

And people who want to live off national wealth for nothing in return are referred to by his ilk as "scroungers". Why do households who get a couple of hundred quid a week in welfare count as scroungers but people who get hundreds of thousands of pounds a year in land rent count as "aristocracy"?

2) That only happens if people insist on over-occupying. If people want to pay less, they can trade down. It makes more sense for workers and businessmen to live near where they work, land rents are higher where there is more economic activity and they are the ones who can afford to pay the tax, why not let them live there?

3) The whole point of income tax (and private collection of national wealth) is to make workers and businessmen poorer and landowners, bankers, politicians and quangocrats richer. So he has completely missed the point as per usual and turned all logic upside down.

4) Income tax is far worse than that. Taxes on earnings, output and profits have huge deadweight costs. For every £1 collected, the economy shrinks by 50p (and then we need to collect yet more income tax to pay for the unemployed). A tax on land has no dead weight costs and actually stimulates economic activity, so for every £1 collected, the economy grows by a few pence. And of course having a user charge for consumption of national wealth does not reduce the amount of national wealth. Imagine: businesses were no longer allowed to charge their customers. Would total wealth increase or decrease?

And while a tax of £1 per year on each worker makes all workers £1.50 worse off in eternity, a £1 annual tax on a plot of land does make all owners of that land in future worse off. The price will be reduced to compensate future owners. We get over it and move on.

5) Typical Homey crap: "I bought my land out of taxed income". No you didn't. You paid off a mortgage out of the money you saved in rent, and the bulk of the value (all the increases in rental value or selling price since then) is an entirely unearned free gift bestowed on you by the equally Home-Owner-Ist government (and if you are old enough, they will have done you the favour of wiping out half your mortgage with inflation).

6) Yes, there is a big difference. Taxes on earned income stifle the economy and help to transfer wealth upwards so that it becomes ever more concentrated and work becomes less and less worthwhile compared to land speculation. Taxes on land rents stimulate the economy (however slightly) and constantly level the playing field between regions, between generations and between the vested interests and the vast majority.

Well duh!

Work Programme staff struggle to help unemployed when 'jobs aren't there'

Well, slap me down with a wet fish, who would have thought it. Think it we might but what we must remember is that various really clever people holding important positions in governments present and past had an inkling that that might be the case, which is why they set up highly expensive because they are so really clever special schemes operated by the people with the right sort of proven expertise and skills and connections to just bypass that and get at least 3 unemployed people into "long term" work for every single job vacancy declared … Clever or not, the article seems to suggest that “all is not going well” and things are being made oh so difficult by the absence of...

The fiscal multiplier in action

From City AM:

THE PLANNED cut in national insurance payments for employers is making one in three small- to medium-sized companies more optimistic about hiring staff, according to figures out today.

Chancellor George Osborne said in his March Budget that the government will waive the first £2,000 on employers' national insurance bills from April 2014. The so-called employment allowance is set to save companies £5.9bn between 2014 and 2018 and a third of employers will no longer pay national insurance contributions, according to government estimates.

Why would it encourage small businesses to take on a significant number of additional employees? If anything, it's a big incentive for a small employer to stay below the £2,000 threshold, which is quickly reached - that would only cover the Employer's NIC on one employee paid £22,000 per annum, on two paid £15,000 or on three paid £13,000. Beyond that, the marginal cost of employing people is exactly the same as it ever was.

But most galling is this bit of fiscal multiplication right at the end:

National insurance, a tax paid by both workers and employers, funds certain state benefits, pensions and the NHS. The coalition has attempted to reform the levy since being elected three years ago.

Does it f-ck!!

From memory, NI raises just over £100 billion a year. State pensions are £90 billion a year, the NHS costs well over £100 billion a year and there's another couple of £ billion for contributory Jobseeker's Allowance. So it covers pensions and a bit of working age benefits but it certainly does not magically pay for the NHS as well. It wouldn't even pay for the NHS in isolation.

And no, the coagulation has not "attempted to reform the levy", they cheerfully bumped up the total rate from 23.8% to 25.8% of gross earnings and left it at that. Sod the employers and employees, those nasty grubby little people who have to engage in free exchange of goods and services in order to make a living.