2011 comes with a UK tax hike

Despite all the nonsensical blusterings of the British Labour Party and others on the left who think that government halting the rise of the state is somehow some neo-liberal revolution, the truth is that the Conservative-Liberal Democrat government is not driven by an ambition to shrink the state.

Proof of this has been seen twice in four days.  On 1 January, the UK's fuel excise duty (fuel tax), one of the highest in the world, went up by another £0.0075 a litre.  Not much, and yes it was a decision from the Brown Government, but the money is entirely to help reduce the budget deficit.  You seen, unlike NZ, the UK's fuel excise duty is entirely revenue for the Crown, none of it is dedicated to roads or transport spending at all (and it corresponds to about five times the total government expenditure on roads).  Fuel tax in the UK is now nearly 59p per litre (NZ$1.18).  That plus VAT makes tax more than half the price of petrol.

Speaking of VAT, that rises to 20% from 4 January, up from 17.5%.  Now VAT in the UK does not include food not served in restaurants, childrens' clothes, books and other items, but this tax increase has provoked considerable buying of bigger items such as cars, electronics and clothes in the post Xmas sales.

All in all, it is more money for the UK government, less for consumers, retailers, wholesalers, producers.  Labour's Ed Miliband is opposing the increase, but like an ostrich in the sand he never says what spending he would cut, what taxes he would increase, and given Labour is so overwhelmingly to blame for a decade of reckless overspending, he has no credibility except for the whinging unionised public sector workforce and those who don't want to be weaned from the state tit. 

The Opposition's only response is to say that the UK government should not cut its overspending so fast, delaying the inevitable, and increasing overall public debt levels - but if you're a socialist who wants to remain willfully blind about government borrowing why shouldn't you just be on the side of "the people" in promoting the same ignorance?

Of course there is no need to increase either tax, it will suppress demand and suppress the private sector.  There is still plenty of scope to cut public spending, such as eliminating child benefits and winter fuel allowances for those not in poverty, getting rid of subsidies for "green energy", not pursuing an unprofitable high speed railway pet project and not increasing foreign state aid.   The British state has grown like an obese nanny never sated on desserts.   Tax increases delay economic recovery and help cement the fact the UK economy is now 50% consumed by the state.

Thatcherite government? hardly.

Top 10 wishes for world affairs - 2011

As below, here are some of my biggest wishes, for international affairs and countries other than the UK and NZ.   As before, from lowest to highest priority (and the list could easily have been twice as long).

10.  A new WTO trade round is rescued from oblivion: The Obama Administration has been absolutely disgraceful on trade, and so the dark economically illiterate forces of ill-guided economic nationalism have raised their ugly heads.  It would be enormously beneficial if the US, EU, Japan and the key developing countries got their heads out of their arses and talked multilateral liberalisation of trade in agriculture and services.  If this is done it could lift global GDP by 1-2%, could dramatically improve the lot of people in food producing countries, service providing countries and consumers worldwide.   It's an indictment on the Obama Administration and the EU that neither have the competence nor courage to lead this.

9. Robert Mugabe is dragged from a car, beaten up and left to die with his wife and lackeys in central Harare, and Zimbabwe gets a truly open accountable government:  This repulsive murderous crook continues to be lauded around Africa (explaining the standards of morality on much of that continent) and by the UN.  A bullet would do, but it would be a delightful message to his Stalinist gangsters and fellow dictators elsewhere as to what can happen to thieving violent bullies.   Let's hope 2011 finishes without Robert Mugabe.

8. Kim Jong Il dies and his son succeeds him, averts a military coup and starts reform seeking guidance and friendship from South Korea:  North Korea is in a sad state due to 60 years of misrule and totalitarianism.  There are plenty there who want reform who know it is needed and fearful of what will come.  There are various paths for it to go down, the best one is to follow its neighbour to the south, of strong rule establishing open civil society, ever opening markets and progressively confronting the lies its people have been bathed in for decades.   Only through reform and economic growth can the strong role of the military be sidestepped.  Only with firm deterrence, but with a friendly hand to assist change with someone who seeks it can this happen peacefully.  Japan wont be trusted, China can't be trusted and South Korea has done an impressive job that Pyongyang need not look elsewhere.

7. The Communist Party of China separates party and state, putting the Party under the rule of law for the first time, and loosens freedom of speech some more:  The biggest hindrances to the growth of China being seen benignly is the iron fist it uses to maintain domestic control, and its unwillingness to have modern independent judiciary and separation of politics from governance.  It is too much to expect China to become a fully liberal state, but a key step forward would be separating party and state, so that the party and its officials can be prosecuted for breaking the law.  Accompanying this should be legal guarantees of free speech to discuss government policy and the behaviour of all politicians and officials.   Only when Chinese people and institutions can hold government accountable, and the Chinese government and CPC stop acting like a moody teenager whenever criticised, will China have become a modern country.

6. The West-bashing climate change agenda comes to a complete halt,  as people in Western countries choose politicians that are unwilling to sacrifice their economies and freedoms to let China, Russia, Gulf States and India emit all the CO2 they wish, and they stop believing the armageddon rhetoric of the anti-capitalist green movement:  It's about time that average people in richer countries stopped tolerating taxes and regulations on their behaviour for the sake of letting the likes of Kuwait and other countries with fast growing economies to do as they wish.  The middle and low income of rich countries should not be penalised to allow the rich in poorer countries to do as they wish, particularly because there is no evidence to support the kind of pillaging interventionism demanded by the developing countries (who want more money to pay for the luxuries of their political elite).  Energy efficiency and cleaner energy are all very well, if people are prepared to pay for them, and governments get out of the way of developing them, but no more should be done.

5.  The Obama Administration has its spending plans frozen, as the new US Congress slashes spending and starts focusing Americans on achieving a balanced budget in less than 4 years:  Unless the US stops growing government and stops debasing its currency through continued borrowing, it will continue to slide relative to other economies.  The US can recover, but it will need a wholly different approach to the spend and borrow policies of recent history.  Here is hoping Americans can maintain the courage.

4. Portugal, Spain, Italy, France and Belgium face sovereign debt defaults, effectively destroying the Euro: All of countries have sustained decades of socialist style big government economic policies, running almost perpetual deficits and borrowing, and all have sought to use the Euro as a hard currency to sustain their economic irrationalism.  The tension in the EU is either it governs national fiscal policies or the Euro is unsustainable.  Let the Euro collapse, and the short term pain will result in a longer term re-evaluation of the EU, fiscal and monetary policy and demonstrate that the Western European quasi-socialist approach has been irrational, unsustainable and immoral.

3. An end to Islamist insurgency and terror: As much as so many haters of Western values and individual freedom cheer them on, I wish very simply, that Al-Qaeda, the Taliban and all other Islamist insurgents fail to carry out any further attacks, whether they be in Iraq, Afghanistan or elsewhere.  The reason should be obvious, it may be idealistic, but this scourge continues to cost in lives, injuries and cash an incalculable amount every day.  Appeasement of Islamism is no virtue.

2. Fiat money is subject to serious review by governments across the world:  Fiat money has proven to be what it has always been, a way for governments to manufacture nothing from nothing, generating either inflation of consumer goods or commodities and property.  Time to reconsider the entire basis for monetary policy and to examine the role fiat currencies had in the financial crisis.  It is the single biggest elephant in the global economic "room".

1. The Iranian people overthrow the country's brutal theocracy:  Having already destroyed any semblance of democracy effectively by military coup, Mahmoud Ahmadinejad is now pursuing nuclear weapons with the forked tongue of a cruel mindless liar.  The people of Tehran know better and rattled this evil regime briefly a year or so ago.   It would be right for them and especially right for the Middle East and the world if this murderous brutal regime was overthrown.

Top 10 wishes for New Zealand politics - 2011

Following from the UK list, here are my top ten wishes for NZ politics in 2011. I'm not being starry eyed and overly optimistic, because I'm getting to the age when I want things to change. the blame and little of the credit.

My top ten from lowest to highest priority:

10. Winston Peters and NZ First remain irrelevant and a historical anomaly:  Hopefully this is simply a matter of the personality cult members dying off over time.  There shall be no third coming for Winston Peters, as much as National has left a constituency to one side again, the cheap talkback caller Muldoonist racism and anti-capitalist hysteria of Winston should be consigned to history.

9. Peter Dunne loses Ohariu:  Long struggling to be relevant, Peter Dunne has been the great political prostitute in recent years having tried to woo ethnic minority immigrants, Christian conservatives, Labour, then National.   His legacy is the creation of a useless bureaucracy called the Families Commission.  He pushed his pork-barrel project, the Transmission Gully motorway, regardless of the cost and economics, and has never been consistently anything other than opportunistic.   He exaggerates his influence for the people of Ohariu.  It is about time they figured it out.

8. The electoral referendum is a negative for MMP:  Having used disenchantment about economic austerity to harness enough people to vote for MMP in 1993, the left regarded this as one of its greatest victories.  It would simply piss them off a great deal if MMP was voted out in the 2011 referendum.  I am non-chalant about what replaces it, I simply want to expose the myth that such enormous constitutional changes should be made on the basis of a simple majority of votes cast.

7. Labour attacks the Maori Party for what it is, and argues the election based on reform of delivery of state services:  Not exactly realistic, but it would be fun if Labour started arguing against the Maori seats and took on the Maori Party directly.  It would also be fun if it had policies promoting private competitive delivery of health and education, as nearly happened in the late 1980s.  This would attract new voters who would see National as status-quo oriented, and Labour as no longer stuck with its old fashioned view of state monopoly provision of services.  Labour, after all, has almost always been the party of change in New Zealand politics.

Sadly, Phil Goff, who is more than capable of making those arguments, is hamstrung by a vile neo-Marxist, trade union, structuralist identity politics, control obsessed party filled with people who were only too keen to stick their sycophantic tongues up Helen Clark's "state is sovereign" view of government.  As a result, I'll be content if Labour drops to less than 30% of the vote, happy if less than 25%.

6. The media puts the Greens under intense critical scrutiny, and fail to get 5% of the party vote:  The Greens get an easy ride compared to most other minor parties, with their anti-capitalist and anti-science hysteria rarely facing real scrutiny.   Press releases about 1999 being the last Christmas for safe potatoes, the hysteria about cellphone towers, nuclear energy, climate change, the anti-trade agenda, the constant desire to regulate, tax and hector people, and the barely concealed racism behind policies on foreign investment and Maori all deserve to be exposed for what they are - the policies of a radical socialist nationalist party that is sceptical about science, quasi-religious about its beliefs and more pro-violent than it would ever care to admit.

5. ACT makes its last gasp worth it by rolling Hide as leader and campaigning on principle:  I personally had a lot of hope for Rodney Hide, but he has failed miserably to demonstrate that he could help pull the Nat led government towards less government in the areas ACT had some major influence over.  His acceptance not only of Labour's local government policy for Auckland, but unwillingness to push for statutory limits on the powers of the Auckland Council shows a distinct lack of courage or commitment to what so many ACT voters were hoping for.   ACT could have been National's conscience.  It now looks like facing electoral oblivion for failure to deliver anything beyond the votes in Parliament to keep National in power.   To have any solid following it will need to change, fast and fundamentally - that means Rodney Hide's political career is over.

4. Assuming National gets re-elected, it grows a pair:  It sells at least one of the power generating SOEs, opens up the rest of ACC to competition, implements a voucher system for compulsory education, abolishes a long list of government agencies, eliminates the budget deficit and cuts the welfare state.   Unfortunately, National's last pair was once Governor of the Reserve Bank.  Expect Muldoonist plodding on, with little innovation, less courage and more government.  Helengrad became Keynesia.

3. Maori vote in record numbers in general seats, not Maori seats:  To do that they would have to reject the racist nationalism that education and media have inculcated in young Maori for the past thirty years, and wish to be treated as individuals with the same rights as other New Zealand citizens.  It would be nice if Maori gave up their patronising racist seats, but I wont be holding my breath.  However, they may turn their back on the equally patronising racist Maori Party.

2. Libertarianz make a good go at the election, getting its best result in 16 years thanks to a competent leader, a simple message about less government, ACT voters being disenchanted and the Nats facing a fairly safe victory.  It would be delightful if the Libertarianz brand was sold on simply being the party that will consistently support less government, without being distracted by detailed policies or past difficulties.  Even better if ACT and National supporters of less government united around the only political brand in the country that demonstrably supports less government spending and lower taxes.  After all, a vote for National is not a vote for less government, a vote for ACT is a vote to continue the current government.

1. The NZ media gets journalists who can ask politicians as to whether governments should do less, spend less and tax less:  Most journalists are reporters, and many simply ask politicians whether they are supporting the right policy or whether more or something different "should be done".  Virtually none ask "why should people be forced to pay for this", or "why should people be forced to do this or not do that".  The real fundamental political debate is whether the state should do more, or do less, but most journalists are more interested in shallow frippery and parroting the constant claims of lobbyists who almost always want government to solve their problems.  When I read how a journalists has asked lobbyists why don't they spend their own money on whatever it is, then it will be a great improvement.  Meanwhile, nothing holds back politics in New Zealand more than the lack of journalists willing to ask intelligent questions from both ends of the political spectrum - more and less government.

It's one thing to be generous...

but another to use coercion to foist a guilt trip on people to be so.

That is one idea floated by the Con-Dem coalition government in the UK.

The idea? Require all cash withdrawals from ATMs and all EFT-POS transactions to offer people an option of "donating" some money to charity.   Of course that would be managed collectively so that "charity" isn't specified.   Some companies already do this as part of their business, but the government is talking about making it mandatory.

What nerve.

The effect is to imply  "you're buying something, you can't do that and not also give money for something else".  It imposes a duty on people to spend a second or two to say no to giving their own money to some charity they haven't had time to even judge the merits of, as if it doesn't matter, it's a charity, charities are good.  This is nonsense of course.   People may object to charities run by specific religions, or they may object to causes that are seen to be more political than philanthropic, or quite simply people want their own money to be used for their own purposes.

Objectivists regard benevolence as being human, natural and a part of life.  People do give of their time, money and possessions to others because they find value in doing so.  At the most basic level it happens most frequently with family and friends, but many give of themselves to strangers and causes, and do so because it gives them joy to support whatever cause it is that they like.  It is not a sacrifice to give time or money for the value of providing support for something you agree with, and to help those you wish to help.

However, the Conservative Party (and dare I say quite a few small "c" conservatives) believe charity is not just about that, but an obligation.  It is as if your very existence and the fact you have or earn money means you are morally obliged to give some to others.  That you owe other people something and that you are somehow immoral if you don't give.   This guilt for your existence and guilt for success is at the bottom of this approach, and even setting aside the burden of tax in the UK (which is over 50% for me if VAT is included), nobody should feel guilty for not giving their money away.  It is, after all, their money.

So to hell with enforced charitable giving.   One point usefully noted by the BBC on TV was that people in the UK are more generous charitable givers than the French and Germans (both known to have more generous welfare states), but less than the US (which has lower taxes and less welfare).  The lesson to the Conservatives or anyone wanting people to be more benevolent, is that when the state takes more, people are less inclined to give.  Even more important, the last thing taxpayers want is to be hectored by those who live off their money, to be charitable.

Although it wouldn't go wrong for politicians to tell anyone who wants the government to spend more on pet ideas that they should spend their own money on it first and then engage in some fundraising, instead of wanting the state to force others to pay.

Farewell Dennis Dutton

I didn't always agree with Dennis Dutton (such as his strong belief in compulsorily funded state radio), but beyond that he was a strong advocate for reason and science.

He passed away today (28 December) of cancer (thank you Homepaddock for the news).  He debunked many paranormal fraudsters, had an open mind about climate change and supported science and evidence over mysticism and the new age snake oil merchants.  He will be sadly missed.

His websites here, here and here.  No doubt more will be written about him elsewhere in a few more days.