Bankers are claiming on both sides of the Atlantic that post-financial crisis regulations are far too complex and costly. Are they right? Or are the new regulations needed to stop a repeat of the 2008 crash? I consider those questions in the Daily Mail.
Strong stuff as ever in the Daily Mail today from Max Hastings, extrapolating from George Galloway’s upset victory in the Bradford West by-election to argue that the win reflects not just local Muslim sentiment and dislike for Ed Milliband’s Labour Party but a collapse in trust between voters and the political class.
The YouGov poll from months ago that he cites is indeed alarming. Just 24 per cent of respondents believed MPs are capable of “debating issues of public concern in a sensible and considered way.” And only 15 per cent saw Parliament as “representing the interests and wishes of people like me.” Barely one-tenth of voters (12 per cent) thought politicians capable of understanding their own daily lives.
More Budget woes for Britain’s Coalition government. Tory MP David Ruffley on the BBC today warned that “pensioners are going to be bellyaching about this for a while. The grey vote is powerful and [Osborne] could have thought better of it and found the money elsewhere.”
According to the Daily Mail, the Chancellor, George Osborne, blames the Liberal Democrats for the row over the “granny tax” on the grounds that if they hadn’t leaked all the popular measures before the Budget, then no one would have paid much attention to the phasing out of the age-related tax allowance. Keep telling yourself that George.
Hardly surprising but the backlash on the “granny tax” George Osborne announced in yesterday’s UK Budget dominates the British newspapers today with both the Daily Telegraph and Daily Mail choosing that angle to lead their coverage.
Presumably Osborne decided to phase out the age-related benefit that dates back to 1925 in order to gain some revenue to pay for the giveaways – to pay for the raising of the salary ceiling for receiving child benefit and for increasing the personal income tax allowance.
Osborne claims the move is merely a tax simplification but he appears to have decided to favor the young –or at least the younger – over the older here, a curious move when it comes to electoral strategy as pensioners cleave more to the Conservatives than to Labour. Of course, Osborne is meant to be the Tories’ electoral strategist, so maybe he knows something here that others don’t. Maybe he’s banking on pensioners dying off!
Aside from the “granny tax”, the Budget is disappointing on two broad fronts. It doesn’t do enough to encourage enterprise and provide incentives for aspiration, and it doesn’t cut public spending, which as a proportion of Britain’s GDP has continued to rise under the Coalition government, along with Britain’s net indebtedness, a development that accounts for Fitch’s recent warning that Britain risks losing its Triple A rating in the next couple of years.
Despite the Chancellor’s claim that this was a Budget for enterprise, it wasn’t. Yes, Osborne has reduced the top rate of tax from 50 percent to 45 percent. That is not a brave or radical move, though. The higher rate wasn’t bringing in much revenue and there were signs that it was deterring the rich and entrepreneurial from settling in the UK. But is 45 percent low enough? The rich will still be paying over 50 percent when local taxes and social security contributions are taken into account.
The reduction in corporation tax is also a good thing and will help business. One hopes it will attract more companies from overseas to set up shop in the UK and encourage others thinking of leaving to remain.
But the Budget was devoid of any creative thinking in terms of using tax breaks and favorable government treatment for setting up business in enterprise zones, for example, a point well made by Alex Brummer in the Daily Mail today, who asked why the government is not offering “VAT and National Insurance breaks in enterprise zones.”
“There is virtually nothing in the Budget, either, to beef up a recovery that’s being driven by increased exports (a result of the 20 per cent devaluation of the pound against foreign currencies) or to place real muscle behind the kind of technological and research-based enterprises that are giving such a lift to the economies of America, China and India,” Brummer writes.
Overall, Osborne seems to have no faith in the proven tactic of cutting spending to allow tax cuts in order to stimulate the economy. And that is really dismaying.
My Daily Mail piece ahead of the Jackson Hole summit questioning whether Helicopter Ben will dump more money on the U.S. economy. Also explores how the U.S. economy is in a worse state now than it was last year when the Fed chairman announced QE2.
The Daily Mail being itself. Lede: “A gay man tried to poison his lesbian neighbours by putting slug pellets into their curry after he was accused of kidnapping their three-legged cat.”
Almost as good as as the great New York Post headline: “Headless Body in Topless Bar.”
The struggle in Iran to ensure all votes are counted just once each is surely put into perspective by the great revolution that is being unleashed on the leafy streets of ancient country towns in England. They are marching against plastic trash bins even in Henley-upon-Thames. The governments quakes. Hardly surprisingly, the great bin revolution as covered by the UK Daily Mail prompted 241 comments from readers. The Iran report received 13 comments.