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A plethora of populist micro measures

“A plethora of populist micro measures” – a phrase used by FT journalist Philip Stephens in an article headed “Populism without purpose” – concisely sums up the Chancellor’s Pre-Budget statement. There is no coherent strategy for bringing down the government’s colossal deficit. But the British government has no coherent strategy for anything at all. This is just another example of how the British government – whether it Dum or Dee in charge – is unable to establish anything like a coherent and strategic approach to policy on just about any issue one might care to mention. All it does is to respond to events and the tabloid-fuelled hysteria that grows up around them.

Labour neglect and cowardice

This approach to legislation by hasty response to hysteria seems to have arisen from about the time that Thatcherism had spent its force. The poll tax was probably the turning point, when it was hurriedly replaced by a botch-up, and the resulting problems, compounded by Labour neglect and cowardice over the issue, are still leaving local government starved of independent  funds, and whilst the same neglect helped to fuel the house-price boom of the mid-2000s. At a trivial level we had the furore over Pit Bull Terriers, followed by botched, rushed and useless legislation. The disastrous involvements in Afghanistan and Iraq were essentially in the same vein.

As for the “windfall tax”, there is one thing one about which one can be certain: those in the firing line will find a way of avoiding most of it.

In all the furore, almost nobody is asking how the bankers got their hands on all that money in the first place? What was its origin? It was not actually created out of thin air. And very little of it came about through the creation of actual wealth, which is why things have come to the present pass. The process by which money is apparently created out of nothing is much more damaging than anyone appreciates. It needs to be prevented, but that is not going to be achieved by hurried responses to people’s feelings of anger and betrayal, however justified they may be.

What do the huge revenue flows that go to the banks actually represent?  It is, as we consistently argue, an edifice constructed out of speculative land pricing, but almost nobody is looking at underlying causes or even showing any curiosity on the matter.

Link to FT article “Populism without purpose”