14 August 2008

Where Have We Heard This All Before?

For those of you who can remember 1979:-
"Mrs Thatcher argued that Government must limit its activities. The state had attempted to do too much and had intervened in areas where it had no business. In place of state action, she extolled the Victorian values of self reliance coupled with private charity". (British Politics: Burch & Moran 1987, p157-158)
Thatcher then went on to triple poverty and inequality by putting huge numbers on the dole and shifting to indirect taxation that put the burden on the poorest while cutting services they needed most and yet still (after 18 years in office) leave the tax/GDP ratio virtually unchanged at 40% of GDP - little different from today.

So, when Cameron uses exactly the same language today, why would anyone expect him to be any different from Thatcher?


  1. I agree with Thtacher's statement, given the context of the times. But it went nowhere near as far as she did, and nowhere near as crushingly fast. Also, no effort on retraining.

    Cameron will be the same.

  2. I'm interested with this idea that Thatcher moved from direct taxation (income/corporation tax) to indirect taxation (VAT).

    VAT (along with Employer's NI) is truly the shittest tax - but it's EU imposed, which is why politicians don't like to talk about it. They'd rather fanny about with 2% cuts in not-so-bad taxes like corporation/income tax.

    Neil, do you include VAT as one of The Great Achievements of the EU?

  3. Thatcher and Major could have left VAT at 8% instead of increasing it to 17.5% as they did (a massive increase) and there was no need to put VAT on utility bills at all.

    The EU only stipulates minimum values of VAT - I think it is 5% on products that are not agreed as exempt as utility bills were and newspapers, children's clothes, books and food still are. The Tories were going to impose 17.5% VAT on utility bills - but Labour came in and reduced them down to the 5% minimum - admittedly Labour couldn't abolish it altogether once the Tories had put the VAT on it.

    Virtually every very country in the world has sales taxes - I don't see how VAT is any worse - not really something you can blame the EU for.

  4. "Virtually every country has sales tax"

    That's not true, in any event rates in non-EU countries tend to be a lot lower - say 5%. And I do blame the EU for this fair and square, there is the funny 5% rate, but the minimum standard rate is 15%.

    And even if your contention were true, sales taxes/VAT/turnover taxes are still the worst taxes of all (unless, as in the case of fuel duties, they are to cover specific external costs).

    And even if The Tories had put 17.5% on domestic fuel, aren't Carbon Taxes the new Holy Grail of socialists worldwide? Does it make any difference to a shivering pensioner whether you call it Carbon Tax or VAT?

    And don't get me started on Personal Carbon Allowances, that's just totalitarianism.

  5. Neil, you're right.

    We should have kept miners digging coal that no one wanted to buy.

    We should have kept British Leyland building cars that no one wanted to buy.

    We should have kept BT in the state-sector providing a third rate service.

    We should have gone down the pan.

  6. Snafu: Thatcher was not talking about privatisation on this occasion (though I notice you don't mention the privatised utility companies - water, gas and electric in your list, not quite so proud of their record are you?).

    Thatcher was talking about replacing state welfare with charity - but all she ended up achieving was masses MORE people dependent on benefit set at sub-decent levels. Thatcher did more to laden us with the crime and welfare problems we have today than anyone else!

  7. Mark, As far as I know, the mimimum standard rate of VAT is set to the minimum any country in the EU has - so if Thatcher had kept VAT levels at 8% the minimum would be 8%. You cannot blame the EU, blame Thatcher, Major and the Tories for increasing it in the first place!

  8. And don't get me started on Personal Carbon Allowances, that's just totalitarianism

    I am surprised that the government has not tried to tie these to ID Cards. ID Cards as a solution to global warming. No perhaps I can see why. Having to present an ID Card to travel on a train, buy petrol or buy a beef joint in the butchers would not go down well amongst 99% of the population!