The Labour party’s war on the better off is dreadful economics January 27, 2014 WHEN governments don’t like something, they tax it. Hence why we have “sin” taxes on alcohol, tobacco and various forms of pollution. Ed Balls’ announcement at the weekend that a Labour government would increase the top rate of tax to 50p – coming on top of his plan to hike corporation tax by 1p on [...]
Mark Carney has been the luckiest of unlucky Bank governors January 23, 2014 BORROWERS, relax; savers, tear your hair out. The Bank of England’s base rates will remain on hold; Mark Carney doesn’t “see an immediate need to change monetary policy.” Carney has been extraordinarily lucky in his misfortune. His flagship policy is in tatters and yet the economy’s strong growth, rising employment and lower inflation means that [...]
Free-marketeers were right on jobs – and the left got it wrong January 22, 2014 THIS is how the conversation kept going, until about six months ago. Pundit: Aren’t you worried that unemployment will rocket if we cut public spending? Free market economist: Not if the economy recovers, and in any case employment has been the one bright spot of this economy. Pundit: But how can employment and the economy [...]
It’s time to embrace deferred gratification and to start saving January 21, 2014 WOW. We knew that the pension crisis was bad – but in reality it’s even worse than that. The situation is catastrophic: the average pension pot is just £36,800, and many people have nothing at all. On current paltry annuity rates, that is just enough to generate a retirement income of a miserable £1,340 a [...]
We love bubbles – but UK has yet to recover from the last two January 20, 2014 ONE last push – that is all that is needed for the UK stock market to finally bury the ghost of the dot.com bubble and bust. Remarkably, the FTSE 100 has still not got back to the level it reached on the last trading day of the previous millennium, a time of euphoria and irrational [...]
Remember Osborne’s global race? We are in danger of losing it January 20, 2014 WITHOUT foreign investment, we would be toast. How many of you, dear readers, work for UK subsidiaries of foreign companies? Or for a business that relies significantly on overseas investors for its debt or equity financing? In the case of the latter at least, the list now includes almost every company listed on the London [...]
A few simple questions for Osborne, Labour and the coalition January 16, 2014 IT is a moral imperative for all politicians to seek to help those on low incomes. Poverty is a horrible, depressing, truly heart-breaking condition. But what is the best way to help the working poor? One approach focuses on policies that promote economic growth, job creation, productivity growth and social mobility, combined with much lower [...]
Labour’s latest bout of banker-bashing is economically senseless January 15, 2014 BRITISH politics is so depressingly predictable. The cost of living crisis is abating (the gap between pay hikes and inflation is shrinking), there was one poor opinion poll for the Labour party (now reversed) and the economy is continuing to recover – so hey, presto, the Labour party has decided to start banker-bashing once again. [...]
The French embassy’s strange attack on me misses the point January 14, 2014 IT was Adam Smith, the great economist, who put it best. “There is a great deal of ruin in a nation”, he once explained, seeking to reassure a panicky young interlocutor. Smith’s point was immensely powerful: it is very hard even for the most misguided, most economically illiterate of politicians to destroy a country’s economy. [...]
Britain’s public sector needs to become more like Switzerland’s January 13, 2014 BRITAIN faces a major problem. We need to shrink our bloated, inefficient state while simultaneously improving our healthcare, pensions, infrastructure and the rest. There is, fortunately, a solution but it will require a degree of political courage currently absent from the UK political scene. The chancellor’s solution – he hopes to cut public spending by [...]
