Tax Credits: The Toffs are making it tough

All buses gone

One morning when I was still living in Amsterdam, I walked up to the bus stop one morning to catch a bus to the train station one my way to work.

Until, that morning, we had 5 buses going from that bus stop in different directions going to the train station that no one had to wait more than 10 minutes for a bus to come by. However, no bus came, or the only other bus that did was not going to the station.

One cursory view of the bus timetables showed that all buses from that stop to the station had been cancelled. I was later to learn that the buses were cancelled because there was a new tram service going to the train station, only that the said tram service was another 6 months away from coming into service.

This was some sort of forward-planning made without considering the impact and consequence on our community for the 6 intervening months where we had to find alternative convoluted arrangements to get to the train station, we had to wake up earlier and leave home earlier to make our connections because of this.

The travesty of tax credits

This brings me to the issue of the day in UK politics, the review of Tax Credits as proposed by the Chancellor of Exchequer. That Tax Credits exist in and off themselves is a travesty and a failing of the democratic capitalist model we have in the UK.

Tax Credits are neither taxes nor credits but a socialist means of supplementing the incomes of workers who are paid such atrociously low salaries in the public and private sector that they can hardly subsist on their incomes. In a way, our capitalist framework does not pay fully for the employment and utility of labour and the slack is taken up by the public purse in the quest to lift the poorly paid above the poverty line.

There are probably macroeconomic policies that can be put in place to make capitalism pay up in full for the cost of labour and expertise, allowing for a middle-class kind of existence, but no government has had the guts to stand up to business and demand they do the morally and ethically right thing about wages. In most cases, these businesses that leach of us to exist for the primary profit motive will howl about changes that cost them more when they are not even meeting their basic costs.

The truth is, we’re worse off

What the new Conservative government plans to do is to reduce the level of income at which people will qualify for the full in-work benefits over which the payments reduce and to limit the benefits towards children to a maximum of two.

We are told that changes to the living wage, higher tax payment thresholds, more subsidised childcare access and other tax jiggery-pokery will compensate for the loss of Tax Credits. The fact is like the transport situation I described earlier, nothing could be further from the truth.

Independent analysts and institutions have already determined that all taken together, up to 3 million families will be worse off, losing an average of £1,000 a year whilst saving the government up to £4 billion in their ideological quest to plug the deficit brought on by the financial system gone riot and the government using public money to save private financial atrocities for which no significant member of the financial community has been held accountable for.

The toffs are making it tough

In all, it is the poor and the low-income earners that have taken the bigger brunt of the austerity measures put in place to compensate for the ‘crimes’ of the City and rich investors, the squeeze is still on the poor without respite.

This might well be the Conservative government’s Poll Tax moment, but I guess not much can be said for the concern or consideration of a well-heeled governing class who have trust funds to last generations that the cries of anguish of the masses will only be an irritation to be blocked out in the comfort of their gilded and soundproofed castles.

This is not the Great Britain many signed up for, but that is the way things are. My transport situation was resolved in 6 months, the lives of people dependent on Tax Credits will not get better in the long run and that is a shame.

Putin and Chavez - Great Leader or Dear Leader?

Overstaying your incumbency

If democracy is just the ability to walk out and vote and hopefully get your vote counted we had a demonstration of that concept yesterday.

I cannot however say that the use of democratic means to decide a direction of governance ends up in a democratic situation – we saw examples of that in Russia and Venezuela.

The week before, it was the elections in Australia where John Howard who had been in leadership over a decade had failed to realise that he had overstayed his welcome.

He lost the premiership and on confirmation would most likely lose his parliamentary seat. That is a damning indictment of a leader who had brought great progress and prosperity to his nation, but somehow, leaders have a tendency to be absorbed by arrogance and hubris that makes them think no one else could do the job better than they have been doing.

Leaders who have become bosses

This incumbency-complex that gravitates towards a pseudo-dictatorship is dangerous because the leader begins to project his ideas as right and hence the only solution whilst regaling us with the idea that leadership is really tough.

This kind of conviction plagued Tony Blair towards the end of his long premiership which left him almost the most unpopular prime minister for generations at the time of his leaving; it has plagued George W. Bush, but now he is moving into a multilateral phase possibly to secure a legacy for himself in the Israeli-Palestinian issue.

Abusing democratic process

The Russia and Venezuela, Vladimir Putin and Hugo Chavez have been schemed to use the democratic process to entrench their incumbency, Mr. Putin would most likely metamorphose into a Prime Minister with considerably more powers than the incumbent has and would serve under a President that would be made into a ceremonial head of state.

The Russian constitution precludes Mr. Putin from serving another term as President, but being absorbed with the idea that no one else can rule Russia in his stead with authority and purpose, he would assume another national leadership post to keep in control.

The was a time I sympathised with Hugo Chavez and the leader of a developing economy that was ploughing some of the nation’s resources and moneys into improving the plight of the poor who had been left uncatered for by successive governments.

America’s moral laxity

Unfortunately, his mildly socialist rhetoric has gained virulence and notoriety exacerbated by America’s complacency when he was overthrown some 6 years ago.

America always fails to learn and lead in the matters of fairness, justice and balance when the issues of democracy, civil rights and oil collide. It acts like a multi-dimensional chameleon in the pursuit of self-interest instead of upholding the mantle of liberal democracies built on vibrant capitalist economies – thereby, it has little moral authority and the only muscle is seems to be able to wield is the projection of military power anywhere on the globe.

Even bullies eventually have their come-uppance and America is sometimes left with allies who can only lend support in word but hardly in means.

Chavez – all mouth

Having arrogated to himself presidential rule-by-decree, Mr. Chavez was not satisfied with the extent of executive authority as his socialism bandwagon gathered steam towards a 21^st Century aberration.

The theory of socialism probably has idealist and Utopian goals, the practice however has yield much less of that ideal – it entrenches a ruling elite that brooks no opposition; it stifles open debate; oppresses the free media; enacts laws for the purpose of exercising omniscience in all areas of the community and society whilst producing too much government that fosters corruption, reduces efficiency, promotes nepotism (See, Time.com - Where everyone important is a Chavez) and sycophancy and eventually destroys the country.

The Time Magazine in Petro Laggard highlights the fact that Venezuela sits on one of the largest reserves of heavy crude which needs large injections of cash to realise and maintain – not much seems to be done to ensure that this “golden goose” of the oil industry remains healthy to satisfy Venezuela’s obligations to the increasing demands for fossil fuels.

Democracy sometimes delivers

However, the referendum that failed yesterday by a margin of just 2% is a welcome development for a motor-mouth that was running out of control.

The question again is why one man thinks out of every good person that can be mentioned in his country, he is the only one who can properly govern his country and bring the goods home.

France is working hard to rescind the 35-hour-week because it offers no particular economic competitive advantage in a global economy and Mr. Chavez proposed to bribe his people with a 36-hour-week, reduced from 44 – no nation of slothful laggards can survive with that slovenly demeanour – projects would take forever and considering the red-tape that socialist ministries can spurn, the country would most definitely grind to a halt.

In the times of almost $100/barrel oil, Mr. Chavez seems to be awash with much cash and little sense of the fact that Venezuela belongs to a global economy, his quest to control the Central Bank of Venezuela is no less the money-grab of a highwayman – it takes more that socialist dogma to run a bank.

Yes, the Venezuelans love their leader but not enough to allow him manipulate the democratic process to deliver a dictatorship thriving on the cult of personality, for that, I am very glad.

Democracy sometimes grates

Mr. Putin has deployed every Soviet tool to grab the election for the United Russia Party that he supports, they have all the means to change the constitution to whatever they might desire, however, I would suppose they would limit their greed to knowing that capability.

All people of a nation should be happy to vote if there was a level playing field in the democratic process – it would appear, hurdles were put in the way of opposition parties who were harassed by thugs and miscreants, they never had equal access to the media, workers were threatened with their livelihoods if they did not toe of the line and monitors did not have untrammelled access to ensure the elections were free and fair.

The party leader announced yesterday that the national leader is Mr. Putin and one can only wonder if this leader would be in the mould of the Dear Leader or the Great Leader none of which augurs well.

On two ends of the world, leaders drunk on the proceeds of oil and intoxicated with power have tried to assume eternal incumbency and omnipotence – one succeeded and the other failed.