Lib Dems don’t need a change of leader. What we need now is a radical change of policies and direction. This starts with a total repudiation of the War on the Poor, waged by Tories through austerity and so-called “welfare reform”. Waged, it must be said, by stealth.
But waged in a manner that should have been more obvious to Lib Dems in Parliament and in government. The cause of this myopia can be debated. What is clear is what occurred while we were looking the other way.
First they came for tenants on benefits living in central London. It destroyed the lives of people who rented homes in boroughs where covetous Conservatives thought they should live – not people on benefits.
Then they came for the old and unwell who enjoyed the luxury, according to miserly ministers, of two bedrooms. Next they came for the disabled and mentally ill on benefits, who could not cope with being bullied by contractors incentivised to get them off the dole.
The list is extensive; far too many examples of the poor, sick and deprived bearing the brunt of excesses emanating from Duncan Smith’s Department of Work and Pensions. While most Lib Dems were as appalled as all caring people, the public failed to recognise this for we failed to spell it out.
Those who approve of the War on the Poor obviously vote Conservative. But victims punish us, their coalition partners, as we were again in local and Euro elections. We take the blame for what the Tories did and we failed to prevent; punished as much for betrayal as being part of it.
Of being to too ready to compromise; of accepting that the concept of collective responsibility should apply in coalition as well as single-party government.
Cutting personal allowances helps, but the real incomes of most of us have fallen by some £1,600 a year since 2010. Our living standards have fallen while the super-rich have doubled their wealth. We should have insisted on a higher top tax rate. But again we did nothing. In the late 1960s, Roy Jenkins taxed the rich as a successful way out of recession.
Austerity only leads to more austerity without investment in people and employment, and the means to achieve this. Keynes showed us how to emerge with strength from recession.
Our urgent need is to return to our political heritage. Time to bring back traditional policies and values: those of Lloyd George and Beveridge who created a real Welfare State; Keynes and Jenkins for economic success; Gladstone and Grimond for treating many social ills.
Do we need a new right-leaning manifesto, when our programmes from 2005 and 2010 are still valid? Nick Clegg advocated these with skill and eloquence. He must do so again as we return to our true principles and beliefs, re-establish our credentials as a radical progressive party, and give up references to being one of the centre ground.
But is there time for this to work? I think so. Others may not. Much depends on when we choose to leave the coalition, and stop worrying, as do some sycophants in the party, of upsetting our Tory partners. European parties in coalition do it all the time. It is high time we did so too.
* Jonathan Hunt is President of Camberwell & Peckham local party and chair of the Southwark Co-ordinating Committee. He is an elected Life Member of the NUJ, and a former parliamentary candidate.
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78 Comments
I voted for you in 2010 and was devastated at that first budget. Your ministers cheered. On this site when I and others asked for help we were derided and called Labour Trolls. I saw no evidence that LibDems were appalled and have seen very little since on here. When told that I had voted for you I was more or less called a liar, there was total denial that people like me would not vote for you again. Now look at your council and Euro results. I and others voted for your party to stop the excesses of Tory and Labour but what did we get?! BedroomTax,attacks on the sick and disabled, secret courts,privatisation of Probation Service, cuts in Legal Aid, reorganisation of the NHS, the attack on Libya. Why do I bother because I will only be moderated!
I think a posting for a Labour party blog has accidentally been sent to LDV. Complete with labour’s attack line about people being £1600 a year worse off.
This starts with a total repudiation of the War on the Poor, waged by Tories through austerity and so-called “welfare reform”. Waged, it must be said, by stealth…..But waged in a manner that should have been more obvious to Lib Dems in Parliament and in government. The cause of this myopia can be debated. What is clear is what occurred while we were looking the other way….
I’m sorry, but everyone knew exactly what was being done and far from looking the other way our MPs voted for it….If this excuse is the ‘new direction’ that the electorate will be expected to swallow then???????
Well said, Jonathan!
A couple of reservations, however. I hope you are right that we have time to convince the electorate. My worry is there would be a severe trust problem. We would, I think, need to sacrifice several leaders of the Orange Book tendency to convince the electors we really were serious about a return to “traditional values”. Not that that’s a bad thing..
Nick may have been a “convincing advocate” of the 2010 manifesto, but he always (as people who read the signs knew) a more right of centre ambition. The 2005 manifesto was probably more authentic.
I do not think the increase in tax threshold has genuinely aided the poor at the expense of those well off (not really progressive), and it has hurt even further our ability to continue to provide good and universal public services, something we as Libs and Dems should want to do, and is likely to be a key part of 21st Century life in a well run society.
Jonathan, this would indeed be the banner under which we should be campaigning.
But you seem to think that Nick Clegg, David Laws and Danny Alexander have been dragged screaming and kicking away from this agenda by those awful Tories.
This is patently not the case. They spent 2005 – 2010 subverting those policies and when they could not get Conference support for their ‘new’ Liberalism they waited until Coalition negotiations to impose their views eg accelerated deficit reduction, increasing the pace of austerity. Not to mention university funding.
Outside the Coalition agreement they have consistently paced step for step with the Tories eg further top-down reorganisation of the NHS with the facilitation of privatisation – bombing Syria – bedroom tax the list goes on and on ..
To me there is an acid test for the 2015 manifesto: in tackling the deficit would you support a greater balance on tax increases over spending cuts than the Tories (and Labour)?
Your parliamentary party voted for this ‘War on the Poor’, it’s their war as much as it is the Tories. I cannot see how the electorate could possibly vote for people who one day vote for a policy they then campaign against.
If you want to change your policies you have to change every MP who voted for them previously.
I thought Jonathan Hunt has it right although perhaps a little optimistic. As one of the disaffected ex members who recently refused to pay further subscriptions in support of these currently wayward policies, my views no longer count.
When I was a member my views only seemed to be those of conference and the parliamentary group clearly told me to grow up and understand that principles and promises do not have any place in the real world. I await the party returning to my real world before rejoining the fight with new leaders of a party I recognise. I regret that my respect for Paddy has been seriously knocked by his unthinking harsh attacks on critics of the leadership.
Without a change of leader such a change of direction would be worse than useless. Firstly Clegg is toxic and it would only further serve to make him come across as someone who will say anything for a few voters while not doing it in government.
“While most Lib Dems were as appalled as all caring people, the public failed to recognise this for we failed to spell it out.” that is simply not true as most of the spineless parliamentary party either supported it or acquiesced to it. If you look on the national website it doesn’t say benefits cap awful nonsense forced on us by the Tories – it lists it as a Lib Dem achievement. Sarah Teather ended up quitting over issues like this.
Nick Clegg defends the bedroom tax on the absurd ground of “fairness” and Mr Clegg told the House of Commons the reduction in benefit would mean more people could successfully apply for social housing as more bedrooms would be available. ” As 95% of people haven’t moved it is idiotic to say it proving a success if getting people to move is its aim. But as critic point out – bedroom tax is not a policy to tackle under-occupation because most people can’t move.
The whole coalition seemed to be based on “the markets” needing stable Government – in David Laws account of the negotiations. The first cuts were to capital projects – aka investment, Decisions taken by Danny Alexander.
Why was tuition fees given to Cable – out smarted by the Tories. Why was constitutional reform given to Clegg, out smarted by the Tories, why wasn’t all constitutional reform put in a great reform bill – out smarted by the Tories, why have all the big decision making departments – Treasury, Education, Local Government, Home Office, Foreign Office, health all run by Conservatives – out smarted by the Tories – who gave the Lib Dems Scottish Office – what a loss to a party with 1 MP in Scotland.
And no, I don’t want to end the coalition, I support the coalition, I am will to forgive mistakes, but it is because I wish to see the Lib Dems in Government we must both learn from our mistakes and Clegg must go.
Very odd that Simon McGrath thinks that caring for the poor, rather than attacking them, is a Labour approach. See the picture above of William Beveridge. I rather think it is Liberal Democrats who are the real champions in the war on poverty. IDS’ ‘harsh love’ approach is illiberal.
@Simon McGrath
Which bits of the above article do you disagree with?
The sentiments and policies presented by Jonathan Hunt sound like the party we should be. But our representatives have voted for too many options which go against them, and – as he says – did not try to make clear that it was done under duress. People will think we’re nasty, naïve and/or stupid if we suddenly try to disown these decisions
“First they came for tenants on benefits living in central London. It destroyed the lives of people who rented homes in boroughs where covetous Conservatives thought they should live – not people on benefits.”
You have got to be kidding.
Nobody wants to see people being made homeless, and everyone deserves to have a roof over their heads. However, having people on housing benefit living in houses far nicer and more expensive than the majority of those in work could afford just does not seem (wait for it…) fair. Especially from my perspective in the North East.
“To me there is an acid test for the 2015 manifesto: in tackling the deficit would you support a greater balance on tax increases over spending cuts than the Tories (and Labour)?”
I would support a further shifting of the tax burden away from the working poor and middle earners; a further tightening of the rules to ensure wealthy individuals and corporations pay their share (with investment in HMRC’s staff base to ensure that could actually be done!); and a thorough audit of the scope and responsibilities of central government, to see just how much of what it does is actually necessary or value for money. I would also very much like to see a further shift away from taxation of earned income and towards taxation of wealth and land.
“We should have insisted on a higher top tax rate.”
Absolutely not. Especially not if it doesn’t actually bring in much extra money. I’m not a fan of taxation as a punitive measure – that’s why I’m not a Labour Party member.
It’s demoralising when someone trashes the party’s record and it gets published on the party’s website. Undisciplined extremists like Jonathan Hunt, who once called all tax advisers criminals and failed to apologise, need to be kicked out.
And no, I’m not talking about those on the centre-left, I’m talking about extremists undermining the party. People can criticise me all they like, but it won’t affect me because I know I’m on the right side of the argument when it comes to being against undisciplined extremists.
What a depressing read this was. A secretive War on the Poor? Waged so secretly there have been votes in the House of Commons, front page headlines and demonstrations, it seems. Apparently they are no longer our opponents; they are our enemies – a poisonous, insidious brand of politics if ever there was one. There is no “War on the Poor”; for one thing, it’s not a war (not by any serious definition I’m aware of). I may disagree with the Tories on a whole range of issues, but they’re not evil, and thinking they are is the kind of thinking that turns people off from our message. If we’re going to talk about welfare, can we do it as a conversation between different view points, not a falsely bifurcated playing field where one side are the irredeemable forces of Satan and the other side purest angels?
So much looking backwards, as well, to a “better” past. Why should we be happy with what Lloyd George or Beveridge said? The world they lived in has long gone; why do we have to shackle ourselves to long extinct forms of living? We need a welfare state that actually responds to the world we live in, not the world of 60 or more years ago. A world where people, money, goods and information are more mobile, where expectations and needs are different. So much for a “Liberal” vision that can’t even bring itself to see anything after 1970. The door is wide open to declinist nonsense here; how it was just better in the past, how there’s something pathologically wrong with this country, how only a vast, extreme political programme can save us from ourselves.
Simply bashing the rich and spraying more money at the poor may work for those who joined the Labour Party, but it doesn’t work for me. I want us to be more than a meek shadow of Labour, separated only by a vision of an electoral system and a fear of the Home Office. A real radical programme casts us out on the centre ground as a powerful, radical voice for change. This article is all about going forwards to yesterday. Not a very Liberal vision.
Stephen Howse
“We should have insisted on a higher top tax rate.”
“Absolutely not. Especially not if it doesn’t actually bring in much extra money. I’m not a fan of taxation as a punitive measure… ”
How about as part of living in a more equitable society? Why is it that the rich need more money ‘as an incentive’ to work, while the unemployed and poor need to have their benefits cut ‘as an incentive’ work? Such is the view of the Tory party and it seems some uber-loyalists to the current strategy.
It’s fascinating how those most gung-ho for the coalition recoil in horror when redistribution of wealth is mentioned.
We are a progressive party not Tories-lite.
By the way, Labour only put up the rate of taxation a few months before the GE in 2010. Labour didn’t do enough to bring about a more equal society, which is why the Lib Dems need to.
Didn’t David Lloyd George want a centrist alliance with the Conservatives at one point? I’m no expert on David Lloyd George, but I don’t think he was the radical lefty that people make him out to be, especially given his pragmatic approach to WW1.
http://www.liberalhistory.org.uk/uploads/23_thorne_lloyd_george_and_the_conservative_party.pdf
“How about as part of living in a more equitable society? Why is it that the rich need more money ‘as an incentive’ to work, while the unemployed and poor need to have their benefits cut ‘as an incentive’ work? Such is the view of the Tory party and it seems some uber-loyalists to the current strategy.
It’s fascinating how those most gung-ho for the coalition recoil in horror when redistribution of wealth is mentioned.
We are a progressive party not Tories-lite.”
We are neither Tory-lite nor Labour-lite, we are a distinctive political party. It doesn’t follow that if you oppose X you are for Y – we shouldn’t fall into the Tory/Labour trap of treating politics as binary.
Anyway, did you not see that I support greater taxation of wealth – particularly inherited wealth? What is that if not redistributive? Don’t confuse an unwillingness to use the tax system to punish the rich with an unwillingness to use it to correct historic social imbalances and inequities – don’t play the Labour game.
Stanley Baldwin on David Lloyd George:
“The Prime Minister was described this morning in The Times, in the words of a distinguished aristocrat, as a live wire. He was described to me, and to others, in more stately language, by the Lord Chancellor, as a dynamic force, and I accept those words. He is a dynamic force, and it is from that very fact that our troubles, in our opinion, arise. A dynamic force is a very terrible thing; it may crush you but it is not necessarily right. It is owing to that dynamic force, and that remarkable personality, that the Liberal Party, to which he formerly belonged, has been smashed to pieces; and it is my firm conviction that, in time, the same thing will happen to our party. I do not propose to elaborate, in an assembly like this, the dangers and the perils of that happening. We have already seen, during our association with him in the last four years, a section of our party hopelessly alienated. I think that if the present association is continued, and if this meeting agrees that it should be continued, you will see some more breaking up, and I believe the process must go on inevitably until the old Conservative Party is smashed to atoms and lost in ruins.”
Anne 3rd Jun ’14 – 9:13am
I voted for you in 2010 and was devastated at that first budget. Your ministers cheered. On this site when I and others asked for help we were derided and called Labour Trolls. I saw no evidence that LibDems were appalled and have seen very little since on here. When told that I had voted for you I was more or less called a liar, there was total denial that people like me would not vote for you again. Now look at your council and Euro results. I and others voted for your party to stop the excesses of Tory and Labour but what did we get?! BedroomTax,attacks on the sick and disabled, secret courts,privatisation of Probation Service, cuts in Legal Aid, reorganisation of the NHS, the attack on Libya. Why do I bother because I will only be moderated!
Spot on.
I agree with the sentiment of returning to traditional Liberal values.
We should remember however, that whilst Liberals are the party of welfare for those who cannot help themselves, it is also the party of free markets, free trade, individual freedom, minimum government intervention in people’s lives and small government.
When Beveridge proposed a free health service at the point of delivery, I don’t think he meant that the government should nationalise everything to do with medicine and care. For example, GPs are mostly private businesses so there is no ideological reason why private hospitals can not also provide NHS care.
I speak as someone who, as a boy in 1959, cycled to the next town to hear the Liberal economist Lord Beveridge speak at a Liberal election meeting. Today’s welfare state is based on the Beveridge report of 1942.
Sorry Simon McGrath: I could never join anything as illiberal, opportunistic and authoritarian as the Labour Party. The fact that they have discovered and used a rather alarming fact does preclude us from using it in election mode.
The main thought that keeps me working for the party is that in a year and a week from now we celebrate 800 years of Magna Carta w ith both Labour, the party of 90-day detention, stop ‘n’ search and ID cards, and the Tories, deport, all could-be terrorists, threatening further attacks on our liberty and human rights.
Otherwise, thanks to those who speak on behalf of he huge majority of party members who want a radical change in policies
Stephen Howse – It’s an awful long time since (I think) Michael Foot called for the “rich to be taxed till the pips squeak”. It’s hardly a “Labour game”.
Eddie Sammon – Yes, Jonathan Hunt is on one wing of the party. That doesn’t make him “an extremist” (undisciplined or otherwise).
In relation to Lloyd George, in his younger years he was most definitely a member of the radical wing of the Liberals. His actions relating to Tory coalition were at least in part because of the falling out with Asquith. That Coalition enabled Churchill – then a Liberal – to exercise his not very well concealed authoritarianism to put down strikes using troops. That, along with a widespread earlier opposition to women’s suffrage, were two of the leading reasons that saw the dormancy of the Liberals, and the quick growth of Labour. It took 80 years to recover. You’re not suggesting going down the same road again….. ARE you?
Do I take from this that we’ve found a few billion stuffed down the back of the Commons’ green benches?
Only I was of the distinct impression that we had a shrinking but still significant annual deficit? Is paying for public expenditure now optional? Have we found a way, missed in France, to squeeze the rich without them seeking solace from the squeezing? Have we eliminated all the public service waste to the point every pound is a pound well spent?
Lets have a look at some of the individual claims ( those which are factual rather than rehashed labour propaganda)
“Then they came for the old ” pensioners are excluded from the bedroom tax and we have put into place the triple lock on pensions
“Those who approve of the War on the Poor obviously vote Conservative. ” Actually the benefit reforms are pretty popular across all voters. http://yougov.co.uk/news/2013/01/07/welfare-reform-who-whom/
” the real incomes of most of us have fallen by some £1,600 a year since 2010″ Not true ( and ignores both the increase in employment and the tax cuts for the low paid) https://fullfact.org/factchecks/tax_bombshell_autumn_statement-29293
“In the late 1960s, Roy Jenkins taxed the rich as a successful way out of recession” Well in his 1968 budget there was as one off special tax charge on investment income which put the tax rate well over 100%. It had little do do with ‘ending the recession’ though. You don’t mention that Jenkins also had huge rise in indirect taxes and big cuts in public spending.
Great article. I think that what a lot of liberal minded people have tended to ignore about the Tories is that there is an element of class war and desperation to the way they do things. Their policies seem to have less to do with balancing the budget than they do with punishing various groups they suspect don’t vote tory. And of course this means shifting all the blame onto the Lib Dems. as a deflection.
My view is that instead of trying to hold ranks, we should challenge some policies the competence of some of the ministers responsible for trying to implement them..
This looks like the “Politician without Principles seeks Voters” approach.
First the LibDems try to be Tory, it doesn’t work, next they try to be Labour.
How about trying something that’s actually LibDem?
Tim, lol, no I am not suggesting going down the same road of the liberal decline! Or even an alliance with the Conservatives. I was just pointing out that Lloyd George could be quite pragmatic.
Excellent post by Simon McGrath by the way, who rebuts the attack lines from the hard left, surprisingly coming from our own side.
Nature is wonderful, it has all sorts of shapes.
It has lines from left to right.
It has triangles with left, right, and top ….
“Stephen Howse – It’s an awful long time since (I think) Michael Foot called for the “rich to be taxed till the pips squeak”. It’s hardly a “Labour game”.”
Calling for taxation on the rich for its own sake is most certainly a Labour gain. We should not be playing it. Ever.
Too many people on both sides of this debate fall into the same old trap of seeing politics as a binary thing.
Labour: More state spending good, less state spending bad.
Tories: Less state spending good, more state spending bad.
That’s the caricature of the debate, and the way in which the other two parties allow it to be polarised. We should not be engaging with the debate on those terms. In some areas I think the government could and should do more, in some areas I think it could and should do a less.
As ever we do well to remember that what the Coalition has delivered on welfare reform has been pretty much the Labour manifesto.
When (OP) “they came for the old and unwell who enjoyed the luxury, according to miserly ministers, of two bedrooms”, they did so several years ago wearing red rosettes.
With 570-odd MPs elected on those values and a tenth as many against, it was always likely to play this way.
I don’t know if Lloyd George could be described as ‘pragmatic’ as much as ‘indifferent to the ideology of potential partners when in pursuit of his own flexible goals.’
But maybe that’s how ‘pragmatic’ is defined these days?
correction second line: NOT preclude us
Stephen Howse
” We are neither Tory-lite nor Labour-lite, we are a distinctive political party. It doesn’t follow that if you oppose X you are for Y – we shouldn’t fall into the Tory/Labour trap of treating politics as binary.”
It’s not binary politics to want a fairer and more equitable society. Of course we are a distinctive party.
It is all the more concerning then when one sees how our strategy of ‘moderation’ has lead to blurring of our distinctive identity – Tory-lite. I don’t favour Labour’s policies either by the way. I simply want a more compassionate and fair society – funny how you seem to think that means Labour?
” Anyway, did you not see that I support greater taxation of wealth – particularly inherited wealth? What is that if not redistributive?” Good. We can agree on that.
” Don’t confuse an unwillingness to use the tax system to punish the rich with an unwillingness to use it to correct historic social imbalances and inequities – don’t play the Labour game.”
I don’t see taxation as a ‘punishment’ but as a way of living in a fairer and more equal society. The Tories love to describe taxation as punishment for their friends and supporters. Hence their back-benchers’ delight when the coalition cut the top rate from 50% to 45% – tossed as a bone to the rich at the same time as austerity measures kicked in for the poor.
Don’t play the Tory game.
David-1, I’m a bit confused, I’m just saying it isn’t really accurate to hold him up as an example of a good radical. Perhaps Tim13 has it right by saying he was radical in his younger days, but not so much as he got older.
Good points by Jen.
Jen I don’t think it is the point whether we could have been easily outgunned on “welfare reform” (it sticks in my craw to describe it thus). Many of our MPs didn’t fight it either, and neither was it seriously contested for the Coalition Agreement, as far as I could see. I don’t think we can really use the often specious argument that our ministers use, “that this would not be happening” under a Lib Dem government. And, our posters here should start to get a handle on all this – either we criticise Labour (as you have) for not trying to help “the poor”, or we criticise them for taking the opposite approach, eg Stephen Howse, Simon McGrath etc. Which is it, guys?
“I don’t see taxation as a ‘punishment’ but as a way of living in a fairer and more equal society. The Tories love to describe taxation as punishment for their friends and supporters. Hence their back-benchers’ delight when the coalition cut the top rate from 50% to 45% – tossed as a bone to the rich at the same time as austerity measures kicked in for the poor.
Don’t play the Tory game.”
I don’t believe that taking over half of a pound someone’s earned fair and square can be justified, to be honest. I don’t support a 50% top tax rate (51% with NI) for that reason. No individual should see the fruits of their labour being eaten up more by the government than they see for themselves.
I’d like to cut it even further, to 40%, and balance out some of the loss to the public purse with the increased wealth taxes I’ve already mentioned. Not because I believe the rich need to be “incentivised” – but because I feel it is the liberal thing to do.
“First they came for tenants on benefits living in central London. It destroyed the lives of people who rented homes in boroughs where covetous Conservatives thought they should live – not people on benefits.”
If you cannot see the injustice of people on benefits being able to live (long term) in locations that working people can only dream of, I wish you well on your trip to electoral oblivion. A benefit cap (which doesn’t even apply to lots of claimants) equivalent to a gross salary of £35,000 is hardly unreasonable. I’ve only been on benefits a few times in my life for very brief periods, but I think I feel sufficiently well-informed to say: no-one should be stigmatised for needing help from the state (taxpayers), after all that’s why we collect tax; people should be given the right support which arguably they are currently not (witness the ATOS episode and repeated stories of benefit delays / admin problems); but on the other hand we must all have confidence in the system allocating its resources fairly.
PS I’m confused, are the vast majority of Lib Dem MPs who voted for the benefit cap going to take credit for this (popular) reform or not?
PPS. Apologies – this is hurried and I have written “you” and “I” which someone very wise told me once not to do, being confrontational. Peace to all 🙂
I find it quite depressing that our Party seems so often to be divided down the old fashioned lines of left and right.
What do they mean any more?
The amount that the Government or State has of our money seems to be more or less fixed at about 45% if we are not to borrow – and we must not borrow. That’s what there is to spend so the only thing that has to be decided is…on what? How can a Government satisfy all the demands from that amount? The answer, it probably can’t. So, to use this horrid phrase, there are difficult decisions to be made.
NHS, education, police, military, local services, transport etc. That’s where it all starts.
We could be a party that satisfies the need for tough financial control and social care which looks after those who cannot care for themselves. The question is, how?
There are ways of making a difference that will be fair to most people but it will need guts, discipline and an electorate that’s willing to accept some big changes. Tax (wholesale change), housing (I do mean more), benefits (I don’t mean more) to start with.
We can be distinctively different ‘in the centre’.
@Stephen Howse
The VC at a local university earns the best part of 400k. Staff being made redundant, on the other hand, are granted minimum redundancy payments – that is, if they are lucky enough not to be on a zero hour contract in the first place.
Oh yeah, and the VC also gets a grace-and-favour mansion and car.
Call it earned fair and square if you like. It’s not the way I’d describe it.
Stephen Howes
My problem with your argument is reality v ideals The truth is that we are propping up wages through the tax system because people are not being payed enough to live for the fruits of their labour. And please define hard work. Coz io me it seems that most of the really high earners are just sitting near the money tap.
Explain why that means the top rate of tax should be set at a punitive (>50%) rate?
@Stephen Howse
Because it’s clearly monopoly money to the people flinging it around with cheerful abandon anyway, so what’s a few extra K in overheads (and that is all that a higher rate of tax would be, that that point) really going to matter?
Surely we should combine income tax and NI, thereby removing the NI cap? It does not seem fair to me that the marginal rate for £150,000 a year is 5% less than £35,000. That would at least be a start.
Stephen H One of the serious imbalances that needs correction (and I thought pretty well all Lib Dems agreed with this) was that the net pay difference between low earners and high earners is now so many times greater than it was, say, in the 70s, or even the 80s. This needs correction both for reasons of social equity, and it would seem (qv Piketty, Will Hutton etc) economic reasons. There seem to be two main ways (or a combination thereof) of closing this gap, 1) Progressive taxation, which you describe as punitive, or 2) More clout to those at the bottom of the pile eg through Trade Unions
John C – That would seem to be an eminently sensible move.
Glenn – We shouldn’t be taxing people at the bottom end just to filter the money back through the system in the form of tax credits. The personal allowance rise is the right approach and should go further with a corresponding cut in NI (or tax/NI merger and no tax at all on the minimum wage).
Tim – I’m not opposed to progressive taxation, I don’t believe in a flat income tax. I am opposed to increased taxation levels on income – I’d rather treat all income the same regardless of whether it came from work, capital gains, inheritance, etc. etc. and remove the ability of those who can afford clever accountants and lawyers to work around the rules everyone else is expected to abide by.
Ha’p’orth – that isn’t a good enough reason to increase income tax levels for EVERYONE earning above a certain amount. Why should we punish the majority for the excesses and misdeeds of the few? Are we not liberals..?
I thought we were “all in this together”. It looks like we’re not. Because if we were, the rich would be hit just as hard as the poor. But we all know that’s not happening, is it?
It’s simple: Cutting the benefits of a disabled person who cannot work, and then hitting them with the Bedroom Tax when there is no place for them to move to will hurt them infinitely more than the person making over £150k who pays a 50p rate of tax on anything over that £150k. How on God’s earth is £150k a year not enough to live on?! I would not even know where to begin to spend that sort of money if that was my salary. That person will probably have to buy a £40 bottle of wine rather than a £50 one. The disabled person, on the other hand, who is at the mercy of the current combined cruelty of the DWP & ATOS, then has to go to a food bank just to eat and could find themselves homeless if Bedroom Tax payments aren’t kept up.
I thought the preamble to this party stated that one of this party’s main purposes was to enable everyone to live without the oppression of poverty? Or has that been thrown out as well?
Also interesting to note is how so many people here are defending those who make over £150k a year, saying taxing them more is “punitive”, while at the same time defending punitive measures for the disabled and poorest among us. And then saying this genuine concern for the poor and powerless is…”extremism”…?! This is, essentially, standing up for the strong and attacking the weak and those who simply cannot defend themselves. I expect this from the Tories, not from you. Funny how those “tough decisions” always affect those least able to handle those decisions.
How far this party has fallen. It now looks like nothing more than a Tory-lite party for well-off people who don’t like the Tories’ traditional -“isms”. Makes me sick to think I used to vote for this party. This is no longer the party of Kennedy. I simply don’t recognise this party any longer. Thank god for the Greens, I say (and the fact they’re now polling better than you lot.)
This party deserves all the support is getting from the electorate. Which is about, oh, 6%.
Hi Stephen, I’m no lefty, but I think there is a centrist liberal case for tax rates greater than 50% on multi-billionaires. I also want taxes cut on the middle class and just the regular rich too, so I’m not just pandering to anyone with this idea.
Am fully in agreement with Jonathan’s piece (not for the first time). There are lots of small policy changes going under the radar all the time which really do erode the incomes of families in poverty and also their ability to plan and manage any level of sustainable or basis household income..
Take on small example, Govt’s proposal to increase wait for benefits = loss of £40/£50 to JSA/ESA claimants http://bit.ly/1oNoScD ; Govt aren’t even consulting on it so their own Social Security Advisory Committee which oppose the change are having to consult for them..
Another being some of the rollout mechanisms for Universal Credit, now there’s wide political support for the principle of Universal Credit (a good liberal reform) but Govt. are ignoring problems over housing costs being lost between DWP and housing associations, IT systems responsiveness to claimants’ changing circumstances, claimant budgeting issues in moving to monthly payments etc.
Don’t even get me on to bedroom tax (people are losing their homes now over this!), council tax relief, one year limits on contributory ESA, and cutting off welfare advice funding etc..
Unfortunately, Simon McGrath is displaying ignorance of welfare policy, just wish he’d read up on this stuff before posting denials
My comment was to Stephen Howse, not Campbell.
I’d like to also add that I only make a measly £25k a year and I’m pretty comfortable. It’s a far cry from the poverty of my youth. Further, if I was ever lucky enough to make, say, £150k a year, I would be more than happy to pay a much larger share of tax. I would see it as my DUTY to those less fortunate than I and a duty to the nation that allowed me to grow up healthy and educated.
Stephen Howse I agree. Taxing ALL income at the person’s marginal rate would be much fairer in my view. I know there’s an argument that investors will leave the county. A few may but I think that any Government who is fair overall will carry the day.
“It’s simple: Cutting the benefits of a disabled person who cannot work, and then hitting them with the Bedroom Tax when there is no place for them to move to will hurt them infinitely more than the person making over £150k who pays a 50p rate of tax on anything over that £150k.”
Why do you need to up taxes on the rich to reverse the ‘bedroom tax’ and other welfare cuts (which when it comes to disabled people I absolutely want to do)?
Also, I haven’t once mentioned wanting to hit those dependent on welfare with further cuts – and as I just said, I want to see funding restored (and indeed increased) for disabled people.
Don’t assume that because someone thinks X, they will automatically think Y.
I would cut taxpayer-funded welfare for those well off enough not to need it, and channel the money towards those that do. It’s not about cutting the total amount of money, it’s about using what there is more effectively.
I would cut taxpayer-funded welfare for those well off enough not to need it, and channel the money towards those that do. It’s not about cutting the total amount of money, it’s about using what there is more effectively.
Precisely!
Stephen Howse “Why do you need to up taxes on the rich to reverse the ‘bedroom tax’ and other welfare cuts (which when it comes to disabled people I absolutely want to do)?”
I’m not saying we *have* to up taxes on the rich. However, we were told before all these cuts that *everyone* would be having to tighten their belts, that we were “all in this together” and that “those with the broadest shoulders” should carry the most pain.
This hasn’t happened, has it? The opposite has happened. Those least able to carry the burden of cuts and austerity have been hit hardest. And your party, with a few noble exceptions, voted for it all in Parliament. I’ve noted that there have been plenty of backbench Tory rebellions in this government, yet hardly any from the Liberal Democrats. Say what you will about the Tories, but I at least give them credit for a) standing up for what they believe in (even if I extremely strongly disagree with it) and b) actually keeping their word on things. Been anti-Tory all my life, but at least their voters can trust them. They continue to do what they have always done: attack the weak and shower the strong with gifts. Unlike your lot. I have no idea what your party stands for now, if anything at all, apart from holding on to power at all costs. Even if there were huge backbench revolts from the Liberal Democrats on, say, the bedroom tax, it still would’ve passed. But then, at least, you would’ve been seen as being true to your word and standing up for what you claimed to believe in.
Stephen Howse
” I’d like to cut it even further, to 40%, and balance out some of the loss to the public purse with the increased wealth taxes I’ve already mentioned. Not because I believe the rich need to be “incentivised” – but because I feel it is the liberal thing to do.”
Mrs Thatcher would agree. Her government cut the top rate of tax to 40%. So what is Liberal Democrat about letting the rich off the hook with a low rate of taxation? Or is this the old trickle-down theory again? The rich make shed-loads of money to create lots of low pay jobs for the poor. What would you do about the rich who don’t keep their money in property but hide their hard-earned cash in tax havens?
@ David Evershed – “We should remember however, that whilst Liberals are the party of welfare for those who cannot help themselves, it is also the party of free markets, free trade, individual freedom, minimum government intervention in people’s lives and small government.”
I accept that the modern Liberal party was the party of individual freedom and welfare. However even in the nineteenth century the Liberal party supported government invention – set up municipal councils, factory acts, education, public health etc. The idea of reducing tariffs was not to reduce the role of government but because with increased trade the same amount could be raised. Removing these tariffs benefited the poor and this was very important to Liberals. Whig and Liberal government also abolished government paid positions that could be used for political patronage. It wasn’t an article of liberalism that there has to be free market solutions or there has to be a small government. Liberalism is about using legislation and the power of government to restrict power to enhance people’s liberty.
@ Stephen Howse – “I don’t believe that taking over half of a pound someone’s earned fair and square can be justified, to be honest.” I would have more sympathy with this position if the same people were also up in arms about the marginal rates of income for those on benefit earning more than £10,000 pa. Universal benefit is removed at the rate of 65% and if you add in income tax and national insurance you get to 97% a long way from 51%.
@ John Critchley – “It does not seem fair to me that the marginal rate for £150,000 a year is 5% less than £35,000. That would at least be a start.” Good point.
Ha’p’orth –” that isn’t a good enough reason to increase income tax levels for EVERYONE earning above a certain amount. Why should we punish the majority for the excesses and misdeeds of the few? Are we not liberals..?”
‘Are we not liberals?’ – ah, the 64,000 dollar question. I’m not entirely sure that the word ‘liberal’ means the same thing to everybody, although I am pretty sure that I don’t think the word means what you think it means, so by your definition, most likely I am not as liberal as you would like.
Paying tax is not a punishment, progressive taxation sounds pretty fair to me, and extreme income inequality has consequences that I regard as undesirable . And if I were making enough money to fall into a 50% rate of tax then I don’t think I would be complaining about it, frankly. What sort of person whines about the government taking away 50% of everything above the first £150,000?! That’s some special pleading right there. Someone who doesn’t want to pay it can leave out the hubris and pay himself/herself less, but he/she won’t, because fifty percent of a ridiculous amount of money is, let’s face it, still a pretty ridiculous amount of money. Sure, it’s an article of faith that all the rich will leave the country the moment a 50% top rate appears, a la Gerard Depardieu snottily stomping off to Russia, and if that happens I am perfectly happy to wave byebye to them at Heathrow.
Jonathan Hunt: “Lib Dems don’t need a change of leader. What we need now is a radical change of policies and direction.”
Libdems4change: “Dear Nick, You made a tough decision to lead the Liberal Democrats into coalition in 2010. It was the right decision for the country.”
We have invented a new form of denialism. When demanding change, we seem to be desperate to balance it with a claim to have got things partly right.
Let’s have honesty. We loused up, completely, big time.
Thanks, David Allen, for this paradox, presented neatly. It is so easy in macho top politics, to go for the easy scapegoat.
“We are getting a lot fewer votes than we were – so the leader must fall on his sword”. The Lib Dems4Change letter seems to indicate that the signatories thought (or publicly acknowledge, anyway) that the strategic reason declared for going into coalition, ie an economic parallel thinking with the Tories, that there was a serious national crisis, one that needed IMMEDIATE action to cut the deficit, and that goal was to be achieved principally through public spending cuts, rather than targeted tax rises. For me, the reason we are in the electoral peril we now are is that we too easily accepted that thesis, and the reason we did that was because we had a big majority of “orthodox” / “neoliberal” economic thinkers at the top of the party making that call. It is my view that had we called out Tories (and, to a large extent, Labour) on this, we would have stayed with our declared position.
Now, I do not think Nick Clegg is an innocent bystander in all this – he regularly called for change in that direction in the thinking of the party, and as many arguments on LDV have shown, encouraged those with more radical economic thoughts to seek elsewhere for their political home. If Clegg has an apology to make, it is for his actions in this respect. Many have done that. For that reason, of going against what was widely seen as the Lib Dems’ primary purpose, is he, and our party widely not trusted in the electorate.
The LibDems4Change letter does not call for a change of political / economic direction, just a change of leader. It endorses, as a controversial example, the big income tax threshold changes (“taking millions out of Income Tax”), whose main effect is to reduce the amount of tax collected – from the well off as well as the middle to low paid – and thereby reduce the amount which can be spent on public services. In order to prosper, electorally, and also to help the people of this country, IMO, we needed 1 To hold off on deficit reduction until things were a lot more stable economically, and 2 When that occurred, use progressive taxation, income tax, buttressed by fairly administered wealth taxation (possibly LVT) to take the main brunt. Nationally and internationally, we needed to ensure that the decisions are NOT taken by big finance, but by democratic governments and democratic supranational bodies. That fits with our party constitution, and that is what we should have been arguing for.
A big part of our rhetoric in 2010 and in years before, was that we were the NEW politics, in juxtaposition to the OLD, represented by Tories and Labour. We have not argued for the new politics in our formation and administration of the coalition, we have merely caved in to the post Thatcher consensus.
In addition, in doing so, we make any attempt to strengthen the many environmentally motivated changes we will be needing to our lifestyle in the short to medium term will be made hugely more difficult and controversial by pauperising many at the bottom and lower middle now, and not demonstrating to the ultra rich that they will be required to make major changes to their lifestyles. Goodness knows, these changes will be difficult enough anyway!
In summary, a change of leader, yes, but a recognition, as David Allen says, we loused up big time. Change of direction, please.
Helen T:
“Mrs Thatcher would agree. Her government cut the top rate of tax to 40%. So what is Liberal Democrat about letting the rich off the hook with a low rate of taxation? Or is this the old trickle-down theory again? The rich make shed-loads of money to create lots of low pay jobs for the poor. What would you do about the rich who don’t keep their money in property but hide their hard-earned cash in tax havens?”
Why is it ‘letting off the hook’?
We have a National Minimum Wage to ensure people are being paid at a liveable level. If they aren’t then government can look at that – we have the Low Pay Commission to make sure the NMW is set at the right level.
As for tax havens – we can do bugger all without international cooperation on this. That’s what we need to be pushing for. We are a tiny country of 65 million (ish) in a world of over 6 billion.
Ha’p’orth:
“I’m not entirely sure that the word ‘liberal’ means the same thing to everybody, although I am pretty sure that I don’t think the word means what you think it means, so by your definition, most likely I am not as liberal as you would like.”
Fair point. I don’t want to do one of the things so-called ‘right-wingers’ are often accused of and claim sole ownership of the word ‘liberalism’! As I myself have argued on here before, although we all start from the same point – the primacy and freedom of the individual – we interpret that to mean different things in policy terms. So I wouldn’t say “you are not as liberal as I would like” at all. I apologise for sloppy use of language!
Anyway. On that policy point:
“And if I were making enough money to fall into a 50% rate of tax then I don’t think I would be complaining about it, frankly. ”
Nor would I. But then I am currently earning below the national average wage. So I would say that. The point is that different people are motivated by different things – and for some people the primary driver is money. I’m not saying that’s inherently good or bad, but the reality is that we need to accommodate for that to a degree – without entering some ‘race to the bottom’ – because people can move, and the more money you have and the more important you are, the more options you have for movement. That of course needs to be balanced with ensuring the rich pay their ‘fair share’. It is a difficult,delicate balancing act. I wouldn’t want to be Chancellor!
This is where I think I differ from some within the party – I don’t see ‘profit’ and ‘being rich’ as inherently bad things and I don’t unfavourably judge people who are motivated by them. I’m not, but some people are – that’s their lookout. I want people to work harder and make more money, pay tax on that money (without some clever accounting trick getitng them out of it) and fund all the things we as a society need to function properly, from top-class healthcare to up-to-date infrastructure.
One final point – I saw someone attacking the ‘lack of radical thought’ (or something like that) amongst ‘right-wingers’. There’s nothing ‘radical’ about defending the status quo – by definition. Wanting to maintain state spending at the same level as it is is by definition not radical. Wanting to slash it to, say, 30% would be. Now I don’t want to do that – I’m not that ‘radical’. But I do want to have a full, comprehensive audit of the scope of the central state to see whether some things aren’t being done that should be, whether some things would be more effectively delivered at a more local level (and I am convinced many things would), and whether some things need to be done by any level of government at all.
I think Helen would be complaining about a 50% rate tax if she was in a career with a short-earnings span such as sports or modelling, or if she faced the risk of losing her job or getting injured regularly.
I think we should tax regular high earners less and super high earners a bit more.
@Stephen Howse
I don’t see profit or riches as inherently bad either. Actions can be bad and attitudes can be bad, but being well paid is neutral in itself. But I do think that the rich should also be prepared to pitch in when times are bad just as they profit when times are good (and when times are bad, thinking about it). We are very careful not to offend the well-paid, as though we think that they are a separate species who are not really part of the country at all. This would suggest that we wholeheartedly believe that the only reason why anybody who works in this country would live in this country is because their accountant advised them to do so or because they cannot afford to leave. Sad, and maybe it is true.
@Eddie Sammon
You know, when people say that sport is a short career they apparently forget that sportspeople have a whole range of future roles available to them as a result of their time at the metaphorical coalface. Ditto models. And everybody, no matter what their job, faces a real risk of losing their job. As for injury, well, it’s part of the job. Many low-paid jobs have high risks (farming, fishing, waste management, education, construction… and do you you know what people get paid for working in bomb disposal?!) I can’t find it in my heart to feel extra special pity for the poor footballers.
Jonathan,
We all need to sign up to this, without hesitation. This is LD policy as in our own manifesto.
@ Andrew Tennant
“Do I take from this that we’ve found a few billion stuffed down the back of the Commons’ green benches? Only I was of the distinct impression that we had a shrinking but still significant annual deficit? Is paying for public expenditure now optional? Have we found a way, missed in France, to squeeze the rich without them seeking solace from the squeezing? Have we eliminated all the public service waste to the point every pound is a pound well spent?”
Totally agree – and this is the fatal flaw with Jonathan’s article. The biggest lie that Labour and many on the left continue to peddle is that there’s some easy alternative to austerity called No Austerity. And as a result those who’ve supported austerity are clearly nasty right wingers who are either Tories or Lib Dems who’ve surrendered all of their principles.
The sad reality is that the only alternatives to austerity now are – 1) austerity later (making our children pay), 2) different austerity – maybe some of the ways austerity has been performed are unfair, but not until you can demonstrate a fairer alternative, 3) some other way of raising more money. As for the latter, the 50p tax rate – according to the independent OBR, would have raised a little but not much on best estimates (and of course estimates can be wrong – one way or other. The French have found that their 75p top rate actually cost money). The most likely scenario is that there really is no Eldorado – some lost city of gold to find lots of tax revenue. If there were, of course we ought to raid it. But in the absence of Eldorado, austerity in some form or other is the least bad option. The real culprits of course are the ones who got us into this mess in the first place – Labour.
Daft, I understand, I just think the regular rich are taxed too much, but not the super rich. I’m averse to risk, so I’m not suggesting doing anything crazy.
As an example, the 45p rate can be cut if you simultaneously add a new 50p rate for those earning over £1 million a year. Ignoring national insurance for now.
And finally, as I said earlier, I don’t think rates higher than 50p for billionaires should be off the table, I’m not recommending it yet, I’m just saying the % isn’t the only thing we should consider. I’m just trying to be rational.
@Eddie Sammon
The points you make are very reasonable – it makes sense to look at many possible options. Still, the rich segment of the population are part of the population too – not just resources to be drawn on, but reasoning, thinking people, members of society. Society can reasonably hold some expectations of them, just as they have expectations of society. It just seems odd to dismiss them as rare and skittish migratory birds who are permanently in readiness to flee for the hills 🙂
I agree Daft, but in the 21st century finance professionals can make billions “flee to the hills” quite easily. I think overall this is a good thing, but perhaps the big funds and banks should also be tackled. As liberals we need to tackle concentrations of power wherever they occur, including in government, which is why I am not on the left. Plus it is just not where my heart beats.
From the post: “What we need now is a radical change of policies and direction.”
To a limited extent I am in sympathy with Clegg and others who wanted to give our policies a firm grounding in sound economic thinking as I had long believed that the Lib Dems needed to get to grips with that. So when the Orange Book came out I was delighted – that is until I actually read it and found only reheated Thatcherism slightly softened round the edges. For that betrayed a fundamental misunderstanding of the challenge we face, namely that capitalism has many varieties and that the neoliberal (aka Thatcherite) version has been a disaster for all but a tiny minority – the 1%. That is, of course, a feature, not a bug. Old Labour may have alienated many (including myself) with their talk of class war but it is the Conservatives who have waged it most viciously and most effectively. As Warren Buffet, one of the world’s richest men, said, “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”
So the project I long ago saw as necessary – to discover an alternative economic formulation that would guide those who seek to deliver a just and sustainable society – remains unexplored territory. Without it all we lack a compass to navigate by and all policy issues remain thoroughly begged because, by default, we have to work from the flawed assumptions baked into the neoliberal view of the world. That problem is clearly visible in this discussion thread with some leaning right and some leaning left but little consensus.
Perhaps in the electoral disaster of last week there is some hope in that at long last hoary old assumptions are being dusted off. Against that the Clegg camp is clearly in complete denial about the scale of the disaster and their part in it revealing, among other things, that the Lib Dem’s vaunted internal democracy is actually more of a paper tiger. Also, I really doubt that the Party’s institutions are up to the task even if they had better leadership.
“The amount that the Government or State has of our money seems to be more or less fixed at about 45% if we are not to borrow – and we must not borrow”
Or 37%, if you follow the coaltion deficit reduction plan to its logical conclusion in ~2018… 🙂
Jonathan Hunt
Jonathan , well done on getting this’s article published in LDV.
It was a smart move to start with the sentence —
“…Lib Dems don’t need a change of leader.”. That guaranteed that you would get under the wire, catching the
dV editors off guard. A bit like the old trick of putting in a card to speak in a Conference debate for the other side and then explaining why your side should win the debate. Hats off to you for this tactic.
Of course you almost gave the game away when you said about the Tories War on the Poor —
“But waged in a manner that should have been more obvious to Lib Dems in Parliament and in government. The cause of this myopia can be debated. ”
A more deadly attack on Clegg’s ineptitude is hard to imagine. We would need a new leader for that reason alone even if we were managing more than 3% support from the voters in places like Newark.
But you really do remove all doubt about the need for a new leader when you write —
“….Nick Clegg advocated these with skill and eloquence. He must do so again as we return to our true principles and beliefs, re-establish our credentials as a radical progressive party, and give up references to being one of the centre ground.”
The idea that in the run up to the general election Clegg of all people is going to “re-establish our credentials as a radical progressive party” is a bit like saying Fred The Shred is going to re-establish City Bankers’ credentials for honest dealing.
“Our urgent need is to return to our political heritage. Time to bring back traditional policies and values: those of Lloyd George and Beveridge who created a real Welfare State; Keynes and Jenkins for economic success; Gladstone and Grimond for treating many social ills.”
When I read that I wonder if your party will survive. All of the names in your list with the exception of Grimond and Jenkins are as relevant to modern Britain as Canning or Walpole or Pitt the Elder.
Beveridge provided the intellectual blueprint for a welfare state which is broken and has failed. I think if he saw what had been produced he would have been horrified. Lloyd George has no relevance today at all. He was effective in the pre 1914 government as Chancellor and in the battle with the Lords but a disappointment as PM. especially in his dealings with Robertson and Haigh, and of course was personally corrupt. Gladstone? A great Chancellor but vastly overrated PM who would be utterly repelled and appalled by modern Britain. Keynes? Not a politician at all. Grimond? He never even held high office as far as I am aware, so what actually is his legacy for our country? Jenkins? Well he was a Labour politician in his pomp, and his legacy is now lamentable. Both in Europe and multiculturalism , although his works of history are eminently readable.
None of them, except Jenkins who was never really a political Liberal, speak to 21st Century Britain at all. Who in your party now does? Clegg, Cable, Alexander, Farron, Huhne?
You seem a party of the past, and this roll call of your exemplars merely highlights it.