Why I should be Chancellor of the Exchequer
The government are a bunch of idiots, Alistair Darling is a fool, and the Prime Minister is a class-A doofus.* To paraphrase Frankie Boyle as Gordon Brown, "If you thought Tony Blair was a c***, watch this".
The reason I hate them all this week is the Pre-Budget Report. Everyone knew that very difficult decisions would have to be made in an attempt to lessen the impact of the global economic slump on Britain. Everyone knew that the numbers involved would be staggering. But no-one wanted what we got.
The government want us to spend our way out of the recession. It's the most effective way of overcoming a downturn in an economy that trades on confidence. The paradox of thrift, the vicious circle of recession, the economic gloom... all these can be overcome by encouraging people to spend their money.
But rather than leading Britons on with the carrot, the government have merely waved it under our noses. The stick will follow shortly. Instead of taking one brave step (giving everyone an income tax cut, which would have given everyone an incentive to spend because they would have more money in their wallets), a series of small, insignificant cuts and rate changes will gradually trickle through.
A 2.5% reduction in VAT will annoy a lot of people, and not make much difference (financially) to the rest. Shops, businesses and accountants will feel the most aggrieved: if they want to pass on the tax cut – and for only 2.5%, the incentive isn't tremendous – they will have to change every shelf-edge price ticket, every till and every day book. The rest of us probably wont notice the change: it only amounts to a 1.4% reduction in the price of everyday goods.
Taxes will even be increased (in real terms) on already expensive essentials/luxuries like petrol and alcohol. National Insurance contributions will be increased. Some people will have 45p out of every £1 they earn taken away from them in the highest tax bands. 45% of everything they earn. Yes, they're getting paid a lot... but it's little wonder people move their money out of Britain PLC when their faced with tax regimes like that.
*I have toned down the language quite a lot here.
