To think Rishi is right - the government cannot be everything to everyone?

[Cuppasoupmonster]

Don’t get me wrong, the Tory government hasn’t tried to be anything let alone everything.

But I think he was right when he said there’s too much reliance on the state to provide for each and every issue the public face.

We could free up a lot of funds by taxing big corporations properly, cracking down on non doms etc. But even then, I’m not convinced the socialist utopia of generous benefits, a five star NHS, cheap and available high quality public housing, instant mental health support etc that is often discussed on here could ever be financially viable.

AIBU?

The difference in a Scandinavian society is that everyone pays very high taxes and everyone gets good services: universal pensions normally linked to their earnings, everyone gets heavily subsidised childcare, etc.

We are being told that due to Government mismanagement those already paying close to 50% in tax should pay even more and receive nothing. Can't access healthcare, education is rubbish, childcare costs a fortune, UK state pensions are rubbish and now they want to ruin private pensions too apparently, housing costs a fortune. All that money is taken and nothing back.

If people want a Scandinavian system they need to accept that higher taxes fall on everyone in the income scale, not just those in higher rate tax who have been funding everyone for years. And that the benefits of this are universal: there were threads this week about means testing state pension?!? That kind of system only works on an everyone pays, everyone benefits basis.

Currently only a tiny percentage of UK taxpayers are net contributors. If you want better services then you can't just keep hammering that group for more, it can't always be "tax someone else". You need a broad tax base where everyone pays in a significant amount and in the UK they don't. This is the part of a social democratic system that people in the UK conveniently ignore. If you want it, YOU will have to pay 30-40% income not just expect everyone else to do it as many higher earners do now. We have one of the smallest tax bases now of any developed country.

You can't tax people who have no money.

The reason so much tax is paid by a smaller and smaller amount of people is because of low wages, since 2008, business and govt has used austerity to suppress salaries for the 90% whilst increasing it (vastly) for the reminder.

The wages they get, are then spent on very high housing, transportation and childcare costs.

Oh and BTW, rather than means testing the state pensions they are generally linked to earnings so that the pension is a % of salaries earned so that those who have contributed most get a decent payout so that everyone can maintain a living standard comparable to what they have paid for through their working lives during their retirement. Even Spain does it on this basis! And Hungary! Most European countries in fact. If you want a system where the poorest are looked after then a) everyone has to make a decent contribution, with a majority being net contributors; and b) you maintain buy-in to the system by making the benefits of the system available to everyone, universally.

So scrap the removal of the personal allowance and any means testing of child benefit and childcare provision, for a start.

Again, people cannot have it boths ways. Either you want a society basis for provision, or not. You cannot sustainably tax some people to the hilt and give them nothing back and expect that system to maintain public support. Scandinavian countries and indeed most other European countries understand this.

The wages they get, are then spent on very high housing, transportation and childcare costs.

That is true of people paying higher rate tax as well.

And the reason people in lower brackets have no money is because of Government mismanagement: see my earlier posts.

Demands that people in the middle on PAYE pay even more yet again are not realistic. They have propped up the economy and everyone else for over a decade now with real terms pay decreases every year and higher taxes every year.

Target the super rich: yes. But this won't be enough to fix it.

If you want a reset of the way society works then yes everyone will have to pay more tax. Much more. Not this "tax someone marginally better off than me" nonsense. That isn't how a collective system works i.e. Scandinavia.

The issue is housing costs & an ageing population. We have a shrinking tax paying base, it's not enough.

That’s essentially my issue. We could hike taxes to what Mn see as an acceptable level, and still not have enough cash for what we need because of factors beyond our control - ageing population, general decline of the west. I don’t know what the answer to the housing crisis is, I don’t want houses built on greenfield land only to need to build more in years to come and destroying the countryside.

You don’t need to be an engineer. Just watch Grand Designs to see the huge costs of large glass expanses. 200/300k for a 2/3 story height wall of glass. That’s fine if you can afford it, but public money shouldn’t be spent on what are effectively art works.

As for staff, yes to safe and decent work places, but there’s no place for luxury when it’s public money.

There’s a middle ground between Dickensian squalor and billionaire luxury.

The answer re building is to knock down huge swathes of semi derelict housing/industrial areas and repurpose the brownfield sites for housing.

Like all this "why should those with private pensions get state pension?" nonsense.

How long do you think a state pension that's not for the incredibly old or sick (as it was when introduced) will persist if the people who find it get nothing?

Many people say "I paid for 40 years" but don't add up what they paid. £10,000 of contribution buys you ~£500 per year of income. If you're paying a couple of hundred pounds a month of NI to fund NHS and pensions, you haven't paid anything like what is required to fund your state pension. Others are subsidising it for you, hugely.

And many don't mind that. But to then suggesting confiscating theirs, which is worth a fraction of what they have paid in because they are subsidising yours... how long do you think they would do that for before there is the political pressure to scrap it entirely?

Same issue if you start taxing higher rate taxpayers who pay for just about all services for everyone else on their pension contributions. At the moment it is fair: everyone pays in tax free and is taxed on withdrawal. You start to tax them when they pay in and pay out? Really?

This is how divisions in society are created. Either you can have a system where everyone pays in a fair amount per their salary and everyone gets universal benefits so everyone buys in.

Or you can have a system of everyone for themselves.

Purportedly we have the former but it has been pushed to its limit deliverately for over a decade now with a small proportion of people funding everyone else and getting less and less back.

I believe this is on purpose, so that public services and benefits lost support from those funding them and can be scrapped. I do not agree with this. And unfortunately those proposing to hammer the people currently paying for them is playing into the hands of those trying to engineer this.

To fix it, in our situation now, you need everyone working/ with unearned income through shareholdings etc paying higher tax and benefits/ services being staunchly defended/ reinstated as universal. If they are not then they will vanish entirely within a decade or two, having been repeatedly downgraded in the meantime.

People need to wake up to the game being played. Spite directed at those with even slightly more when they are not causing the problems.

If you want to move towards a social democratic system them means testing state benefits or child support and taxing only the group in the middle who have been paying the bulk of everything for years is the exact opposite of what you need to do.

But certain wealthier groups should pay more than they do, i.e. OAPs with hefty pensions, buy to let properties, share portfolios etc are paying less than workers with similar incomes as they don’t pay NIC etc

But it wasn't private citizens who spaffed all that lockdown money up the wall or more precisely into their friends pockets for - Test & trace, Nightingale hospitals , unsuitable PPE etc etc
It wasn't private citizens who allowed the energy wholesalers to make megaprofits at their expenses
It wasn't private citizens who printed money with gay abandon and put interest rates up 3%
It isn't private citizens who are responsible for the porous uk borders

Or are you just generalising , let’s be real, because your laundry list of “socialist utopia” (?!) things, are needs which you and others you know have already have privately met for yourself , and so you don’t like the idea of higher taxation so others get it for “free”?

Why do you assume the "problem" caused by high taxation is other people getting things, rather than taxpayers not getting things?

For example, if we abolished free GP services, there would be a group of people who are better off, because the reduction in their taxes is more than enough for them to pay private GP fees.

Similarly, there are relatively well-off people who cannot currently afford private education for their children, but who, if they weren't paying through their taxes for other people's children to be educated, could pay for something better than a state education for their own children.

There will be people on above-average incomes whose funding of other peoples state pensions means might have to work maybe ten years longer than they would if everyone was responsible for themselves.

To suggest no one suffers real personal disadvantages from state-mandated redistribution makes you come across as a bit of a propagandist.

Effectively, this is all just part of the Brexit/ unicorns spiral. Someone else should pay.

It doesn't work like that.

Hold your Government to account. Tell your MP that they need to fix their own fuckups and rejoin the single market. No sympathy for anyone struggling who hasn't emailed their MP about this.

And then if you want a different society: everyone has to pay and everyone has to benefit.

Yes that’s exactly what I said 🙄

We need to tax wealth far more heavily.

You know that’s bullshit right?

According to this report by HMRC the top 1% of earners contribute about 30% of tax received by the government and I can assure they use less government resources as they are more likely to send their kids to private school, use private medical etc.

www.gov.uk/government/statistics/income-tax-liabilities-statistics-tax-year-2019-to-2020-to-tax-year-2022-to-2023/summary-statistics

Infact there are many many people in the UK who are negative contributors to tax as they pay little tax and when you consider the resources used eg NHS, schools etc they are actually getting more than they pay in.

Part of the issue is many in the UK no longer have the drive and will to increase their income and are content staying at or close to minimum wage and chugging along. The UK is not innovating or growing at the level it should and we’re all focused on taxing the rich more so we can continue to remain mediocre.

The lack of engagement with my posts here is depressing. We can all moan about the issues but when the wider picture is described and the options set out, nobody wants to know.

What, of the options set out, do people want to choose?

What are they doing about it? Have they pressured their MPs?

(I am an economist).

I don't think this is true: see

ifs.org.uk/publications/characteristics-and-incomes-top-1

Yes, we have a shrinking tax base, although paying tax doesn’t end with claiming the state pension. Successive governments have had 50+ years to prepare for this and have failed dismally.

Housing is the real issue. There will be a big rise in the number of houses sold over the next 20 odd years. Increase in supply should damp down prices but it won’t be enough. We need a huge building programme of social housing with right to buy removed, unfortunately that’s going to be difficult when the country’s bankrupt.

During the financial crisis 2008, hank Paulson was throwing up or dry heaving as they called it, but it was kept secret at the time as it was said that if it was known that the Secretary of the treasury was throwing up, at that moment it would spook the economic markets.

@AliensAteMyHomework i agree with what you wrote.

@Blossomtoes right to buy should never have happened.

As the banks use a fiat currency system, they can pretty much print what is needed.

Absolutely agree. Right to buy was a cynical exercise in buying votes and it should have been stopped by the Blair government. It’s scandalous that it’s still happening.