We both come from very different worlds. One of us is a millionaire investor, the other a social worker and union member. We have totally different experiences of the economy, but we share the fundamental belief that it is broken – and the government, in its autumn statement, did nothing to fix it.
The cost of living crisis affects us all, but it does not affect us in the same way. One of us struggles to afford the spiraling price of the weekly store, while the other can shop as before, unaffected by rising food prices. One of us is afraid to turn on the heating to keep his house warm, while the other can heat his house and travel in the winter sun without a second thought.
That’s not how an economy succeeds. The argument of the last Prime Minister – that the only path to economic success is to allow inequality to grow even further in our country – is simply wrong. Wealth does not come from above and does not trickle down, it comes from all of us. There is no path to prosperity by increasing inequality.
The new chancellor may have accepted this argument in theory, saying in his autumn statement that he “demands more of those who have more”, but that is not the reality. A slight lowering of the maximum tax rate threshold and some adjustments to the dividend and capital gains tax thresholds will, as one of us can attest, be barely noticed by those with real wealth. . By comparison, squeezing low- and middle-income tax rates generates far more revenue and will cause far more economic hardship.
Instead of squeezing low wages, the Chancellor should have matched his actions with his rhetoric and taxed the wealth at the top. If the last Prime Minister’s attempt to deliver huge tax cuts to the wealthy is part of what brought down the economy, then the opposite seems like a good starting point to address it – as even those in among us who have the highest incomes should recognize that.
Let’s start by taxing the very wealthy – people whose wealth exceeds £10m. A wealth tax of just 1% or 2% on their stocks of wealth of over £10million would give our country the investment it desperately needs to weather the harsh winter ahead. According to Arun Advani, Assistant Professor of Economics at the University of Warwick’s CAGE Research Centre, a 1.1% tax on wealth over £10m would bring in £10bn at the 0.04% levy. richest in the population.
We also need to ensure that people’s income is taxed at the same rate no matter how it is earned. The reality of our current tax system is that money made from work, such as caring for the vulnerable, is taxed at a higher rate than money made from investments or the growing value of assets. Injustice is maddening and also holds back our economy.
It matters because of the other big part of the Chancellor’s plan: cutting public services. The bitter experience of recent years shows us that when public services such as welfare are cut, it puts pressure on other areas and we all suffer. We need to invest in our public services and those who work in them, rather than inflicting further cuts that continue a journey of decline. It is not unaffordable. Wealth exists in this country, but the government’s unwillingness to tax it properly is what robs our services of the funding we need. One of us sees the result of this underfunding every day, as staff in the care sector work longer and longer hours for less and less pay and feel more overwhelmed than ever. We simply cannot ask these staff to continue to give their all to keep the welfare sector afloat, when what is desperately needed is the additional resource that only the government can provide.
A collection of groups have come together to form the Stop the Squeeze campaign, to call for this vital change of direction. It is a rejection of the failure of the economics of inequality that has held us back and an endorsement of the simple idea that, as the saying goes, we are all better off when we are all better off. This program is supported by economists, charities and trade unions, but more importantly, it is backed by the public, with large majorities across the political spectrum in favor of higher taxes on wealth. We both never met, but we both felt the inequality in this country couldn’t continue, so we got involved with Stop the Squeeze (one through a union, l each other as part of the anti-inequality group Patriotic Millionaires), and decided to write this piece together.
The media also have a role to play here. The overall “tax burden” narrative is designed to deflect the real questions that need to be asked about exactly who is being asked to pay, and whether it makes sense. The focus on tax cuts during the Tory leadership race over the summer, which even included framing questions from the BBC to candidates in terms of when, not if, taxes should be cut, is a good example of this lack of nuance in the public debate on taxation. . We can all see where this kind of groupthink has gotten us. If anything should have made people realize the need to question the propaganda that low taxes on the wealthy are good for everyone, then the past few months should surely have been the wake-up call we needed.
We may not have to vote for the new prime minister, but that doesn’t mean he doesn’t have to listen to us. An economy that works for one of us but not the other is an economy that will never work. A country where people who do essential work in our communities struggle to put food on the table is not a country that works.
Winsome Hill is a caregiver and member of the Community union; Julia Davies is a millionaire investor, lawyer and member of Patriotic Millionaires
Comments on this article are pre-moderated to ensure that the discussion stays on the topics raised by the author. Please note that there may be a short delay in posting comments on the site.
#millionaire #caregiver #cruel #divide #rich #poor #disgusts #Julia #Davies #Winsome #Hill