...a blog by Richard Flowers

Friday, October 08, 2010

Day 3568: It's No Good Looking Clever NOW


I said to Daddy this morning: basically, Mr Potato Ed has NO CHOICE. If he gives Mr Bully Balls the Shadow Chancer job, then he's as good as signing Hard Labour up to five years of Balls-o-nomics, the living in denial argument that there's no need to cut the deficit, and he can kiss goodbye to the next General Election today. Nor can he give the job to Ms Cooper because, unlike Mr Ed himself, SHE won't stab a family member in the front.

So he's just GOT to give the pair of them the OTHER two "Great Orifices of State", and I bet it's going to be the bully in the Home Office and the fragrant one in the Foreign Office.

And I'd have taken a side bet on Mr Johnson-and-Johnson being the one to come though the middle to be Shadow Chancer, what with him being the "safe pair of hands" (i.e. reliable old reptile with no eye on Mr Potato Ed's OWN job).

If I'd actually written that this morning I'd have looked REALLY CLEVER now, wouldn't I!

Ho hum.

Of course, in this means that the state of the economy will be argued out between a retired postman and the tuck shop monitor.

But in a way this is actually rather ENCOURAGING, as it shows that there is at least a CHANCE that a Mr Ed economic policy from Hard Labour may be something with which we can do business. Unlike a Bully Balls economic policy which would have been no more than another two-by-four with which to bash Master Gideon about the head.

So long as we are remaining PRAGMATIC about tackling the deficit, the speed, depth and detail of the cuts are all NEGOTIABLE to a certain extent, so long as, in return, the other side is willing to say what they would do instead, or why waiting is warranted.

(The PROBLEM arises when Hard Labour gets stuck in the groove of "we agree something must be done, but not THIS" about each and every proposal, just as former Safety-Elephant Mr Charlie Clarke did on BBC Questionable Time. That quickly ceases to be constructive opposition and becomes having OUR cake and eating it. And wanting YOUR OWN cake too.)

The twin policy announcements this week and subsequent debacle as well-off well-connected media types colluded with well-off well-connected members of the soon-to-be-Shadow Cabinet to kick up a huge fuss are a case in point.

The important thing to remember is that BOTH policy announcements (withdrawal of Child Benefit AND capping the amount of benefits you can receive) were target at the better off. Yes, BOTH of them. While it is OBVIOUS that taking benefit from Higher Rate taxpayers is aimed at the better off, what EVERYONE seems to have overlooked is that limiting benefits to median household income can only possibly have an effect on those who are by MATHEMATICAL NECESSITY in the top half of household income.

(I realise that that's BETTER OFF which is not the same as WELL OFF let alone RICH, but it IS still true that you have to be doing BETTER than 50% of the country to lose out. In fact, as it's median WORKING household income, it's actually at an income level higher than that of MORE than half the nation.)

Both cases also suffer the same problems: they are both CRUDE CUT-OFFS, which leads to ridiculous so-called "edge effects" where people lose substantially more than they gain when they tip over the edge point. In fact, this is the whole POVERTY TRAP that Mr Iain Drunken Swerve is trying to get us all OUT OF by reforming the rest of the benefits system. SO a bit of not-very-joined-up-thinking from Master Gideon there, making NEW poverty traps for old.

Another problem is that they are ARBITRARY limits, not taking into account any special circumstances (e.g. a person needing round the clock medical care, a veteran of Afghanistan perhaps, could be receiving many thousands in benefits to pay for their essential care, and I think we'd all think rightly so).

But just because there are problems, that doesn't mean that these ideas are NECESSARILY bad starting points; and this is where opposition should be about proposing MODIFICATIONS rather than outright REJECTION.

Remember, everyone saying "you can't cut THIS" is perilously close to saying "do it to someone LESS WELL OFF instead ".

Here's a proposal for Mr Johnson-and-Johnson for free: a penny on the Higher Rate (upping it from 40% to 41%) would hit largely the same people and apparently raises nearly as much as the Child Benefit cut. But without any of the unfortunate cut off problems.

So SERIOUSLY: propose that instead.


Andrew Hickey said...

Agree with much of this, as always, but one thing - I *think* essential care would come out of someone's Disability Living Allowance, which is unaffected by the new proposals (there'll be no upper limit on benefits for any household with at least one person claiming DLA).

Millennium Dome said...

Thank you, Mr Andrew; that is a RELIEF to hear!

There are times when the coalition don't help themselves by going for the POPULIST point and missing the NUANCE which is actually better thought out and often more liberal.

David Matthewman said...

"what EVERYONE seems to have overlooked is that limiting benefits to median household income can only possibly have an effect on those who are by MATHEMATICAL NECESSITY in the top half of household income."

While that's a mathematical necessity, it doesn't follow that said people are better off, on a per-member-of-the-household basis, than people whose household income is less but who have smaller households. Particularly with benefits, which tend to be awarded on an individual basis, when I see a household getting over £26,000 in benefits I tend to assume that that's because they're a large household that's entitled to those benefits.

I mean, yes, OK, if you want to make a rule that says 'we'll only pay child benefit for the first two children' (as some commentators seem to think this will do) then, while I'd argue against it, I'd at least feel it was fair. But capping at an arbitrary household limit seems very unfair indeed to me.