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Archive for the ‘United Kingdom’ Category

I’ve written many times about America’s looming fiscal collapse, and I’ve also pontificated about America’s costly and failed welfare state.

I even have speculated about when America reaches a tipping point, with too many people riding in the wagon of government dependency (as illustrated by these famous cartoons, which even have a Danish equivalent).

If you read all my posts on these issues, I like to think you’d be very well informed on these topics. But if you want to save time, my colleague Tom Palmer put all these issues together in a recent speech in Australia.

Best of all, he includes lots of great material on the moral and historical aspects of this discussion.

The good news is that there are signs of progress, at least outside the United States. Denmark, for instance, has cut back on its welfare state.

And now, even the United Kingdom has engaged in some serious welfare reform.

Here are some excerpts from a column in the UK-based Telegraph.

 Why should there have been this improvement in the labour market? …The most convincing explanation is surely the Government’s welfare reforms. They have made it more difficult and less attractive to live off benefits, thereby increasing the supply of workers. In economists’ jargon, the natural rate of unemployment has fallen.

Another Telegraph column digs into the details.

…more jobs are being created in Britain than in the rest of Europe put together. …There has clearly been a game-changer… What confounded the eggheads was that the number of workers is growing four times faster than the number of working-age people: in other words, Britons have become far more likely than pretty much anyone else to look for –and find – work. Why?

The answer is simple economics and incentives.

Fewer people now claim the three main out-of-work benefits than at any time during the Labour years. This, of course, is perfectly explained by IDS’s reforms, which make it a lot harder to live on welfare. Those who have been on incapacity benefit for years have been summoned to assessment centres to see what work they’re fit to do. Far more of the unemployed are being penalised for missing job interviews. A benefits cap has been imposed; housing benefit is being reformed; and the so-called “spare room subsidy” has been abolished, making life more expensive for those on benefits with unused rooms. …this is not about punishing “shirkers”, but helping good people trapped in a bad system. Fixing that system means making life harder for people who have it pretty tough already, at least for a short while. But under the Labour regime, such people were being led down the path to dependency and poverty. A new road had to be built, leading to work. And only now is it becoming clear quite how many people are taking it.

Here’s a chart showing how actual job creation is beating the forecasts.

These are remarkable numbers, particularly when you compare them to the job forecast put forth by the Obama White House, which grossly over-stated the number of jobs that would exist under the so-called stimulus.

The key takeaway is that incentives matter. When you give people unemployment insurance, you reduce incentives to find work. When you give people Obamacare, you reduce incentives to earn income. When you give people welfare and food stamps, you reduce incentives for self-reliance.

And when you add together the panoply of redistribution programs operated by government, it’s easy to see why far too many people are being trapped in government dependency.

If you like charts, here’s a very sobering image of how the welfare state destroys incentives for upward mobility. And if you like anecdotes, here’s a dismal story about government making leisure more attractive than productivity.

P.S. At least one honest leftist acknowledges that there’s a problem.

P.P.S. On a lighter note, here’s a satirical Declaration of Dependency from the left.

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When the new Tory-led government came to power in the United Kingdom, I was rather unimpressed.

David Cameron positioned himself as a British version of George W. Bush, full of “compassionate conservative” ideas to expand the burden of government.

But even worse than Bush, because Cameron also jacked up taxes when he first took office, including big increases in the capital gains tax and the value-added tax.

But I must admit that policy in recent years has moved in the right direction, at least with regard to corporate taxation.

Writing for the U.K.-based Telegraph, Jeremy Warner remarks that business activity has significantly strengthened.

A survey by EY, published on Monday, showed that the UK is continuing to pull away from the rest of Europe in terms of Foreign Direct Investment (FDI). The UK secured nearly 800 projects last year, the highest ever, accounting for around a fifth of all European FDI, far in advance of any other country. …Such investment is in turn helping to fuel Britain’s economic recovery… Go back 10 years and it was all the other way; companies were scrambling to leave the country and domicile somewhere else. It is perhaps the Coalition’s biggest unsung achievement that it has managed to reverse this flow.

So why has the United Kingdom experienced this economic rebound?

Lower corporate tax rates are key, Warner explains.

…it has done so largely through the tax system, where it has been as good as its promise to make the UK the most competitive in the G20. By next year, Britain will have the equal lowest headline rate of corporation tax – along with Russia and Saudi Arabia – in this eclectic group of economies, as well as at 20pc the lowest by some distance of the G7 major advanced economies. Other G7 countries range from 25pc to a crushing 38pc and 39pc in France and the US. …Britain has also halted the double taxation of repatriated foreign profits and the taxation of controlled foreign subsidiaries.

So the 20 percent corporate tax rate has yielded good results.

Now let’s connect the dots.

More economic activity means more income for taxpayers.

And more income means a bigger tax base.

Which means…can you guess?…yup, it means revenue feedback.

In other words, we have another piece of evidence that the Laffer Curve is very real.

…Reducing corporation tax has reversed the outflow of corporate head office functions, and doing so has substantially added to overall employment, output, income tax, national insurance and VAT receipts. Dynamic modelling by the UK Treasury has shown that lower tax rates are helping to drive a higher overall tax take. The “Laffer curve” lives. …Let business profit from its own enterprise. It’s amazing how effective this principle can be in generating growth, and yes, taxes, too.

If you want more evidence about the Laffer Curve, here’s one of the videos I narrated.

Warner points out, by the way, that the United Kingdom should not rest on its laurels.

If modest reductions in the corporate tax rate are good, then deeper cuts should be even better.

If comparatively minor changes like these to the competitiveness of the tax system can have such dramatic effects, just think what more serious, root and branch tax reform might achieve. In Singapore, the headline rate is 17pc, in Hong Kong 16.5pc and in Ireland just 12.5pc. There’s a way to go.

Though if The U.K. keeps moving in the right direction, that may arouse hostility and attacks from countries with uncompetitive tax systems.

Indeed, the statists at the European Commission have just launched an investigation of three countries for supposedly under-taxing companies.

Here are some blurbs from a report in the Wall Street Journal.

European Union regulators are preparing to open a formal investigation into corporate-tax regimes in Ireland, Luxembourg and the Netherlands… The probe by the European Commission, the EU’s executive arm, follows criticism in Europe of low tax rates paid by global corporations… The probe is likely to consider whether generous corporate-tax regimes in Ireland, Luxembourg and the Netherlands amount to illegal state aid. …The EU’s tax commissioner, Algirdas Semeta, has warned that the region “can no longer afford freeloaders who reap huge profits in the EU without contributing to the public purse.”

This is remarkable.

In the twisted minds of the euro-crats in Brussels, it is “state aid” if you let companies keep some of the money they earn.

This is horrible economics, but it’s even worse from a moral perspective.

A subsidy (or “state aid”) occurs when the government taxes money from Person A and gives it to Person B. But it’s a perversion of the English language to say that a subsidy takes place if Person A gets a tax cut.

By the way, this perverse mentality is not limited to Europe.

The “tax expenditure” concept in the United States is based on the twisted notion that a tax cut that results in more money in your pocket is economically (and morally) equivalent to a spending handout that puts more money in your pocket.

P.S. The United Kingdom also provides us with powerful evidence that the Laffer Curve plays a big role when there are changes in the personal income tax.

P.P.S. Notwithstanding a bit of good news on corporate tax, I’m not optimistic about the U.K.’s long-run outlook. Simply stated, the nation’s political elite is too statist.

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The title of this post sounds like the beginning of a strange joke, but it’s actually because we’re covering three issues today.

Our first topic is corporate taxation. More specifically, we’re looking at a nation that seems to be learning that it’s foolish the have a punitive corporate tax system.

By way of background, the United States used to have the second-highest corporate tax rate in the developed world.

But then the Japanese came to their senses and reduced their tax rate on companies, leaving America with the dubious honor of having the world’s highest rate.

So did the United States respond with a tax cut in order to improve competitiveness? Nope, our rate is still high and the United States arguably now has the world’s worst tax system for businesses.

But the Japanese learned if a step in the right direction is good, then another step in the right direction must be even better.

The Wall Street Journal reports that Japan will be lowering its corporate tax rate again.

Japan’s ruling party on Tuesday cleared the way for a corporate tax cut to take effect next year… Reducing the corporate tax rate, currently about 35%, is a long-standing demand of large corporations. They say they bear an unfair share of the burden and have an incentive to move plants overseas to where taxes are lower. …Business leaders want the rate to fall below 30% within the next few years and eventually to 25%… The Japan Business Federation, known as Keidanren, says tax cuts could partly pay for themselves by spurring investment. Japan’s current corporate tax rate is higher than most European and Asian countries, although it is lower than the U.S. level of roughly 40%.

If only American politicians could be equally sensible.

The Japanese (at least some of them) even understand that a lower corporate rate will generate revenue feedback because of the Laffer Curve.

I’ve tried to make the same point to American policymakers, but that’s like teaching budget calculus to kids from the fiscal policy short bus.

Let’s switch gears to our second topic and look at what one veteran wrote about handouts from Uncle Sam.

Here are excerpts from his column in the Washington Post.

Though I spent more than five years on active duty during the 1970s as an Army infantry officer and an additional 23 years in the Reserves, I never fired a weapon other than in training, and I spent no time in a combat zone. …nearly half of the 4.5 million active-duty service members and reservists over the past decade were never deployed overseas. Among those who were, many never experienced combat. …support jobs aren’t particularly hazardous. Police officers, firefighters and construction workers face more danger than Army public affairs specialists, Air Force mechanics, Marine Corps legal assistants, Navy finance clerks or headquarters staff officers.

So what’s the point? Well, this former soldier thinks that benefits are too generous.

And yet, the benefits flow lavishly. …Even though I spent 80 percent of my time in uniform as a reservist, I received an annual pension in 2013 of $24,990, to which I contributed no money while serving. …My family and I have access to U.S. military bases worldwide, where we can use the fitness facilities at no charge and take advantage of the tax-free prices at the commissaries and post exchanges. The most generous benefit of all is Tricare. This year I paid just $550 for family medical insurance. In the civilian sector, the average family contribution for health care in 2013 was $4,565… Simply put, I’m getting more than I gave. Tricare for military retirees and their families is so underpriced that it’s more of a gift than a benefit. …budget deficits are tilting America toward financial malaise. Our elected representatives will have to summon the courage to confront the costs of benefits and entitlements and make hard choices. Some “no” votes when it comes to our service members and, in particular, military retirees will be necessary.

The entire column is informative and thoughtful. My only quibble is that it would be more accurate to say “an expanding burden of government is tilting America toward financial malaise.”

But I shouldn’t nitpick, even though I think it’s important to focus on the underlying problem of spending rather than the symptom of red ink.

Simply stated, it’s refreshing to read someone who writes that his group should get fewer taxpayer-financed goodies. And I like the idea of reserving generous benefits for those who put their lives at risk, or actually got injured.

Last but not least, I periodically share stories that highlight challenging public policy issues, even for principled libertarians.

You can check out some of my prior examples of “you be the judge” by clicking here.

Today, we have another installment.

The New York Times has reported that a mom and dad in the United Kingdom were arrested because their kid was too fat.

The parents of an 11-year-old boy were arrested in Britain on suspicion of neglect and child cruelty after authorities grew alarmed about the child’s weight. The boy, who like his parents was not identified, weighed 210 pounds. …In a statement, the police said that “obesity and neglect of children” were sensitive issues, but that its child abuse investigation unit worked with health care and social service agencies to ensure a “proportionate and necessary” response. The police said in the statement that “intervention at this level is very rare and will only occur where other attempts to protect the child have been unsuccessful.”

So was this a proper example of state intervention?

My instinct is to say no. After all, even bad parents presumably care about their kids. And they’ll almost certainly do a better job of taking care of them than a government bureaucracy.

But there are limits. Even strict libertarians, for instance, will accept government intervention if parents are sadistically beating a child.

And if bad parents were giving multiple shots of whiskey to 7-year olds every single night, that also would justify intervention in the minds of almost everybody.

On the other hand, would any of us want the state to intervene simply because parents don’t do a good job overseeing homework? Or because they let their kids play outside without supervision (a real issue in the United States, I’m embarrassed to admit)?

The answer hopefully is no.

But how do we decide when we have parents who are over-feeding a kid?

My take, for what it’s worth, is that the size of kids is not a legitimate function of government. My heart might want there to be intervention, but my head tells me that bureaucrats can’t be trusted to exercise this power prudently.

P.S. I guess “bye bye burger boy” in the United Kingdom didn’t work very well.

P.P.S. But the U.K. government does fund foreign sex travel, and that has to burn some calories.

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It’s not often that I agree with the Washington Post, but a government-run monopoly is not the best way to get mail delivered.

Moreover, it’s not often that I agree with the timid (and sometimes reprehensible) Tory-led government in the United Kingdom, but they just put the Royal Mail into the private sector. And that’s something deserving of loud applause.

Here’s a slice of the big news from the Financial Times.

The goal of privatising Royal Mail had defeated governments for 40 years. …Even prime minister Margaret Thatcher balked at the political risk of selling off a public service that carried the Queen’s head on its stamps. This time, the legislation went through parliament.

My Cato colleague, Chris Edwards, is suitably impressed.

Here’s some of what he wrote for Cato-at-Liberty.

Britain privatized its Royal Mail in 2013, proceeding with an initial public offering of shares that raised about $2.7 billion. …privatization in Britain has been hugely successful. Prime Minister Cameron should be applauded for having the guts to build on the privatization reform legacy of Thatcher, Major, and Blair. Meanwhile on this side of the pond, Republican Darrell Issa is having trouble getting his own nominally conservative party to accept even small changes to the broken government postal system.

Not surprisingly, some folks in Washington think we should move in the wrong direction by retaining the monopoly and allowing the Postal Service to enter new lines of business.

In this interview with Neil Cavuto, I explain why the Postal Service should be unleashed – but only after getting weaned from the taxpayer teat.

You’ll notice that I took the opportunity to explain that many poor people can’t afford banking services in part because government “anti-money laundering” rules impose very high costs on banks.

And since I’ve already mentioned that I have strange bedfellows at the Washington Post and UK government on the issue of postal privatization, I may as well note that the World Bank agrees with me about the poor being disadvantaged by these ill-advised financial regulations.

Let’s close with a good cartoon by Jerry Holbert.

Postal Service Cartoon

It’s not as good as his classics about Obamacare, sequestration, big government, and Patty Murray’s budget, but obviously very appropriate for today’s topic.

P.S. In there was a contest for government stupidity, the Japanese might be front runners.

No, I’m not talking about their bizarre policy of regulating coffee enemas.

Instead, I’m baffled by the notion of government-funded dating. I’m not joking. Check out these excerpts from the British press.

The Japanese government is funding matchmaking events in a desperate attempt to boost a birth rate that has halved over the past six decades. …The support of marriage – and the active encouragement of young people to settle down – is regarded by government policy-makers as a key strategy for boosting the nation’s birth rate. …Matchmaking events organised by local authorities, where young singles are introduced to one another in romantic settings, are becoming increasingly common in areas such as rural Kochi, a prefecture around 500 miles west of Tokyo.

By the way, Japan does have a severe demographic problem.

And when you mix falling birthrates and increasing longevity with a tax-and-transfer welfare state, the results are catastrophic.

But the right way to deal with that problem is with genuine entitlement reform, not another bound-to-fail government-run version of Match.com.

P.P.S. If you like making fun of foreign governments, here are some more examples.

Taxpayer-financed friends for mass murderers in Norway.

Spending 800,000 euro to collect 25,000 euro of tax in Germany.

Giving welfare handouts to foreigners in the United Kingdom.

Remember, nothing is too stupid for government.

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Back in 2010, I shared a video that predicted a catastrophic end to the welfare state.

I said it was an example of “Libertarian Porn” because:

…it is designed for the dark enjoyment of people who think the government is destroying the nation. If you don’t like bloated government and statist intervention and you think that the policies being imposed by Washington are going to lead to hyperinflation and societal collapse, then you will get a certain level of grim satisfaction by watching the video.

While I also stated in that post that I thought the video was far too dour and pessimistic, I don’t automatically reject the hypothesis that the welfare state will lead to societal chaos.

UK RiotsIndeed, I’ve specifically warned that America might experience European-type disarray because of big government and I even wrote about which nations that might be good escape options if the welfare state causes our country to unravel.

Moreover, I’ve speculated about the possible loss of democracy in Europe and specifically said that people should have the right to be well armed just in case society goes you-know-where in a handbasket.

So I’m definitely not a Pollyanna.

I’ve given this background because here’s another video for those of you who revel in the glass being nine-tenths empty. It’s about the United Kingdom, but these numbers from the BIS, OECD, and IMF show that the long-term spending problem is equally severe in the United States.

Be warned, though, that it’s depressing as well as long. And I gather it’s also designed to sell a magazine, so you can ignore that (particularly if you’re not British).

Now that I’ve shared the video, I’ll add a couple of my own observations.

First and foremost, no country is past the point of no return, at least based on the numbers. It doesn’t matter whether we’re talking about the United Kingdom, the United States, Greece, or France. Politicians always have the option of reforming entitlements and restraining the burden of government spending. So long as they follow Mitchell’s Golden Rule over an extended period of time, they can dig out of the mess.

That’s why I’m a big fan of Switzerland’s spending cap, That policy, technically known as the debt brake, imposes a rolling cap on budgetary growth and has been very effective. Colorado also has a spending cap that has been somewhat effective in restraining the cost of the public sector.

My second observation, however, is that some nations may be past the psychological point of return. This is not easy to measure, but it basically means that there’s good reason to be pessimistic when the majority of citizens in a country think it’s morally acceptable to have their snouts in the public trough and to live off the labor of others. When you have too many people riding in the wagon (or riding in the party ship), then it’s difficult to envision how good policy is implemented.

Indeed, the video includes some discussion of how a growing number of people in the United Kingdom now live off the state. And if you add together the votes of people like NatailijaTraceyAnjem, Gina, and Danny, perhaps the United Kingdom has reached a grim tipping point. Especially since welfare spending has dramatically increased in recent years!

A third and final point about the video. I think it focuses too much on deficits and debt. Red ink is a serious issue, to be sure, but it’s very important to understand that too much borrowing is merely a symptom of too much spending.

P.S. On a totally separate matter, everyone should read the USA Today column by Glenn Reynolds. He explains how government is perverting our criminal justice system.

Here are some of the most important passages, but you should read the whole thing.

Here’s how things all-too-often work today: Law enforcement decides that a person is suspicious (or, possibly, just a political enemy). Upon investigation into every aspect of his/her life, they find possible violations of the law, often involving obscure, technical statutes that no one really knows. They then file a “kitchen-sink” indictment involving dozens, or even hundreds of charges, which the grand jury rubber stamps. The accused then must choose between a plea bargain, or the risk of a trial in which a jury might convict on one or two felony counts simply on a “where there’s smoke there must be fire” theory even if the evidence seems less than compelling.

This is why, Glenn explains, there are very few trials. Almost everything gets settled as part of plea bargains.

But that’s not a good thing, particularly when there are no checks and balances to restrain bad behavior by the state.

…although there’s lots of due process at trial — right to cross-examine, right to counsel, rules of evidence, and, of course, the jury itself, which the Framers of our Constitution thought the most important protection in criminal cases — there’s basically no due process at the stage when prosecutors decide to bring charges. Prosecutors who are out to “get” people have a free hand; prosecutors who want to give favored groups or individuals a pass have a free hand, too.When juries decide not to convict because doing so would be unjust, it’s called “jury nullification,” and although everyone admits that it’s a power juries have, many disapprove of it. But when prosecutors decide not to bring charges, it’s called “prosecutorial discretion,” and it’s subject to far less criticism, if it’s even noticed.

Here’s the bottom line.

…with today’s broad and vague criminal statutes at both the state and federal level, everyone is guilty of some sort of crime, a point that Harvey Silverglate underscores with the title of his recent book, Three Felonies A Day: How The Feds Target The Innocent, that being the number of felonies that the average American, usually unknowingly, commits. …The combination of vague and pervasive criminal laws — the federal government literally doesn’t know how many federal criminal laws there are — and prosecutorial discretion, plus easy overcharging and coercive plea-bargaining, means that where criminal law is concerned we don’t really have a judicial system as most people imagine it. Instead, we have a criminal justice bureaucracy that assesses guilt and imposes penalties with only modest supervision from the judiciary, and with very little actual accountability.

Glenn offers some possible answers.

…prosecutors should have “skin in the game” — if someone’s charged with 100 crimes but convicted of only one, the state should have to pay 99% of his legal fees. This would discourage overcharging. (So would judicial oversight, but we’ve seen little enough of that.) Second, plea-bargain offers should be disclosed at trial, so that judges and juries can understand just how serious the state really thinks the offense is. …And finally, I think that prosecutors should be stripped of their absolute immunity to suit — an immunity created by judicial activism, not by statute — and should be subject to civil damages for misconduct such as withholding evidence. If our criminal justice system is to be a true justice system, then due process must attach at all stages. Right now, prosecutors run riot. That needs to change.

Amen to all that. And you can read more on this topic by clicking here.

The Obama years have taught us that dishonest people can twist and abuse the law for ideological purposes.

Obamacare rule of law cartoonWhether we’re talking about the corruption of the IRS, the deliberate disregard of the law for Obamacare, or the NSA spying scandal, the White House has shown that it’s naive to assume that folks in government have ethical standards.

And that’s also true for the law enforcement bureaucracy, as Glenn explained. Simply stated, people in government abuse power. And jury nullification, while a helpful check on misbehavior, only works when there is a trial.

Indeed, I’m now much more skeptical about the death penalty for many of the reasons Glenn discusses in his column. To be blunt, I don’t trust that politically ambitious prosecutors will behave honorably.

That’s why, regardless of the issue, you rarely will go wrong if you’re advocating fewer laws and less government power.

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Why do statists support higher tax rates?

The most obvious answer is greed. In other words, leftists want more tax money since they personally benefit when there’s a larger burden of government spending. And the greed can take many forms.

They may want bigger government because they’re welfare recipients getting handouts.

They may want bigger government because they are overpaid bureaucrats administering ever-growing programs.

They may want bigger government because they’re lobbyists manipulating the system and it’s good to have more loot circulating.

They may want bigger government because they’re one of the many interest groups feeding at the federal trough.

Or they may want bigger government because they are politicians seeking to buy votes.

But greed isn’t the only answer.

Some statists want higher tax rates for reasons of spite and envy.

Consider this poll from the United Kingdom. It shows that an overwhelming majority of Labour voters want higher tax rates even if the government doesn’t collect any money.

Class Warfare UK Tax Poll

These numbers are remarkable.  It’s not just that the Labour Party is filled with people who want to punish success, I’m also dismayed to see that 16 percent of Tory voters and 35 percent of UKIP voters also want class-warfare tax hikes solely as an instrument of envy (though, given the mentality of some of their leaders, I’m pleasantly surprised that “only” 29 percent of Lib Dems are motivated by spite).

What about Americans? Do they have the same mentality?

We don’t have identical polling data, so it’s hard to say. But it would be very interesting to show leftists the IRS data from the 1980s, which unambiguously demonstrates that rich people paid more tax after Reagan dramatically lowered the top rate, and then see how they would answer the same question.

If they’re motivated by greed, they would favor Reagan’s tax cuts. But if they’re motivated by envy, like leftists in the United Kingdom, they’ll be against Reagan’s lower tax rates.

Unfortunately, there’s at least one prominent statist in America who has the same views as England’s Labour Party voters. Pay close attention at the 4:20 mark of this video.

Yes, you heard correctly. President Obama wants higher tax rates and class-warfare tax policy even if the government doesn’t collect any additional money.

Which means, of course, that he’s willing to undermine American competitiveness and reduce economic output solely to penalize entrepreneurs, investors, small business owners, and other “rich” taxpayers.

Remarkable.

P.S. By the way, the poll of UK voters wasn’t merely a theoretical question. UK Laffer Curve Class WarfareThe previous Labour Party government raised the top tax rate from 40 percent to 50 percent near the end of last decade and there’s very strong evidence that this tax hike failed to raise any revenue. In all likelihood, the then-Prime Minister, Gordon Brown, imposed the class-warfare policy in hopes of gaining votes in the upcoming election.

P.P.S. Notwithstanding their many flaws, at least the folks who work for left-leaning international bureaucracies acknowledge the Laffer Curve and generally argue against pushing tax rates above the revenue-maximizing level.

Since it takes a lot to be to the left of the United Nations, that gives you an idea of where Obama (and UK Labour Party voters) are on the ideological spectrum. Which is why I made the tongue-in-cheek suggestion that Birthers accuse Obama of being born in Denmark rather than Kenya.

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When I posted a video about “libertarian porn” back in 2010, readers presumably were either relieved or disappointed that there was no nudity.

Heck, even my libertarian sex jokes don’t involve sex, so I doubt I’ll be in much demand at comedy clubs.

I may get the same reaction today, because we’re going to have a discussion – but only G-rated – about what our British friends are referring to as “poverty porn.”

More specifically, that’s the term that’s being used for television reality shows in the United Kingdom that expose welfare fraud. Here are some excerpts from a story in U.S. News & World Report.

A shoplifter, a recovering drug addict and a young couple barely able to feed their kids are among the stars of “Benefits Street” — a smash hit reality show featuring welfare recipients that has stirred up a storm of controversy in Britain. The program zooms in on a rough Birmingham street where 9 out of 10 people are said to live off state payouts, chronicling over five episodes the lives of jobless neighbors as they struggle with their daily problems. …Britain’s welfare state has long been a subject of pride among many Britons, but these days attitudes toward benefits have hardened — and polls suggest that support for pouring taxpayer money into welfare, especially for the young, is at a record low. British tabloids are replete with hysteria stories about unemployed people buying flat-screen TVs and designer goods using welfare funds. And “Benefits Street” is the hottest in a growing genre of reality shows about the poor that has been dubbed “poverty porn” because of its sensationalist nature. Even the sober BBC has jumped on the bandwagon with a documentary called “Britain on the Fiddle,” which set out to catch benefits fraudsters in the act on camera. …The “poverty porn” trend comes as Prime Minister David Cameron’s government tries to overhaul the benefits system.

By the way, if you want examples of the “hysteria stories” in the “tabloids,” check out NatailijaTraceyAnjem, and Gina and Danny.

You’ll understand why I wrote that, “if there was a welfare Olympics, the U.K. would have a lot more medals.”

Anyhow, the good news is that politicians in the United Kingdom are finally taking some measures to rein in the welfare state. I don’t know if it’s because television programs are exposing waste and fraud, but it’s clearly good news since welfare spending has exploded over the past 10-plus years in the UK.

Here’s part of a report in the Telegraph.

In a speech that seeks to build on “extraordinary” jobless figures, the Work and Pensions Secretary will promise to end the “twilight world” of entire communities that are reliant on benefits. …Mr Duncan Smith will warn that there are still benefits-dependent areas that “for the most part remain out of sight”. Sources suggested that this is a reference to communities such as the one seen on Benefits Street, a Channel 4 documentary, and said that he was on “a crusade to rescue Benefits Street Britain”. “I have long believed there is no kindness in a benefits system that traps people, leaving them in a twilight world where life is dependent on what is given to you, rather than what you are able to create,” Mr Duncan Smith will say. …A Conservative government wants to ensure that welfare is “a journey that people are on, rather than a destination where they stay”, he will add.

I’ll withhold judgement on whether the squishy Cameron government actually is doing something good in this area, but I’m glad that there’s at least pressure for positive change.

Which is why we need some “poverty porn” in America.

Maybe that would be a wake-up call for our politicians on how the welfare state creates a poverty trap and erodes social capital (something that a few honest liberals have acknowledged).

P.S. In an example of sloppy/biased journalism, the U.S. News article states that “The show has struck a strong chord in a nation…still reeling from its most brutal austerity measures in a generation, with basic public services trimmed drastically.” Why is that passage biased and/or sloppy? Well, because as I had to explain to Paul Krugman, there hasn’t been any genuine austerity in the United Kingdom.

P.P.S. The story in the Telegraph also contains this passage.

The number of people in work rose by 280,000 in the past three months to a record 30.15 million, the biggest quarterly increase in employment on record. Minutes released by the Bank of England’s Monetary Policy Committee said that the “tightening in the eligibility requirements for some state benefits might have led to an intensification of job search”. Mr Duncan Smith claimed that the comments were a tacit endorsement of his welfare reform programme. He said the Bank of England, led by Mark Carney, now believed that the welfare reforms had contributed to the dramatic fall in unemployment.

In other words, this Michael Ramirez cartoon is correct. The numbers from the UK are evidence – in addition to all this evidence – that people are more likely to find jobs when they can’t rely on taxpayer handouts.

P.P.P.S. If “poverty porn” changes the political environment, it could mean the end of the Moocher Hall of Fame.

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The English are an interesting tribe. There is much to like about their country, including the fact that voters repeatedly elected Margaret Thatcher, one of the world’s best leaders in my lifetime.

On the other hand, the United Kingdom has veered sharply to the left in recent decades, and Thatcher must have been very disappointed that her Conservative Party now is but a hollow shell, controlled by statists who actually think people should voluntarily pay extra tax to support wasteful and corrupt government.

And the politicians openly pursue Orwellian tax-collection tactics!

No wonder the country now faces a very grim future.

But the thing that most irks me about the British political class is the fanatical embrace of anti-gun policies. Consider some of these examples.

Given these example of anti-gun zealotry, you won’t be surprised to learn that some English pundits think America is primitive and backwards for retaining an individual right to bear arms.

You may be thinking, “so what, they have their bad laws and we have our good laws.” But it seems at least some Brits want to disarm not just their own citizens, but Americans as well.

Writing for the UK-based Guardian, Henry Porter asserts that it is time for the United Nations to somehow undermine private gun ownership in the United States.

…what if we no longer thought of this as just a problem for America and, instead, viewed it as an international humanitarian crisis – a quasi civil war, if you like, that calls for outside intervention? … If this perennial slaughter doesn’t qualify for intercession by the UN and all relevant NGOs, it is hard to know what does.

Mr. Porter doesn’t specify how the United Nations and other non-governmental organizations are supposed to accomplish this task.

Does he want Obama to ram through the U.N. treaty that leftists hope would trump the Second Amendment?

If so, all I can say is good luck trying to enforce gun bans. The American people would engage in widespread disobedience if our own politicians tried to take away our constitutional freedoms.

I’d like to see UN bureaucrats try to disarm these great Americans

And if a bunch of U.N. bureaucrats tried to do the same thing…well, that’s such a ridiculous notion that I’m reminded of my fantasy about what might have happened if the United Nations had tried to stop Texas from executing a child murderer who originally was from Mexico.

But the call for UN intervention is not the most absurd part of the article.

What could be sillier, you ask? How about the fact that Mr. Porter implies that gun owners are akin to slave owners. It’s not an explicit accusation, but you can see in this excerpt that he wants readers to draw that conclusion.

Half the country is sane and rational while the other half simply doesn’t grasp the inconsistencies and historic lunacy of its position, which springs from the second amendment right to keep and bear arms, and is derived from English common law and our 1689 Bill of Rights. We dispensed with these rights long ago, but American gun owners cleave to them with the tenacity that previous generations fought to continue slavery.

So if you “cleave” to your guns, you’re on the same level as the people who defended slavery. I guess this is the U.K. version of Obama accusing some Americans of “clinging to guns.”

Ironically, Mr. Porter self identifies as a “journalist specialising in liberty and civil rights.” But he doesn’t specify what side he’s on, so I guess we can assume – based on this column – that he specializes in undermining liberty and curtailing civil rights.

P.S. The Guardian is known as a left-wing newspaper, but I’ve always had a special place for them in my heart ever since one of their writers accused me of being “a high priest of light tax, small state libertarianism.” He meant it as an insult, of course, but I think of it as the nicest thing ever written about me. Even better than this.

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Back in 2010, I guest-hosted Larry Kudlow’s CNBC program for a couple of days. During one of the segments on my last show, I crossed swords with the other host, Simon Hobbs, as we argued whether patients needlessly died because of the government-run healthcare system in the United Kingdom.

Grim Reaper with KidSince neither one of us had data at our fingertips, it was basically a he-said/he-said exchange.

A few days after that tussle, however, I posted some evidence supporting my side of the discussion.

And over the past few years, I’ve posted additional material showing thousands of extra fatalities resulting from the U.K.’s government-run healthcare system. Including the fact that hundreds and hundreds of patients are allowed to starve to death!

Today, I’m going to administer the coup de grâce. I don’t think anybody will be able to pretend that bureaucrats and politicians do a good job after watching this powerful news report from the United Kingdom

There is a lot of powerful data in that report, but the number that jumps out at me is that death rates are 45 percent higher in the United Kingdom than they are in the United States.

That’s not statistical noise. That’s a huge gulf and it shows a massive failure on the part of government on the other side of the Atlantic.

By the way, none of this is to suggest that the American system is perfect. We have huge problems caused by direct government intervention (programs such as Medicare and Medicaid) and indirect government intervention (with the tax-code’s healthcare exclusion being at the top of my list).

So while England’s big-government approach puts people on waiting lines and causes needless deaths, America’s big-government approach causes third-party payer which cripples the free market and leads to high prices and inefficiency.

But if I have to choose between the United States and the United Kingdom, it’s not even close. The American system is not as screwed up as the British system, though I realize that’s damning with faint praise.

Let’s close by reminding ourselves that Paul Krugman infamously wrote that, “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.” The news report you just watched suggests that he’s putting ideology above evidence. And if you want more data (some of it very distressing and tragic), you can click here.

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As an advocate of small government, I’m often distressed that I sometimes have to rely on Republicans in Washington to fight statism.

Why am I distressed? Because some of the worst people in Washington are GOPers. They may give lip service to fiscal responsibility when campaigning, but then conveniently forget that rhetoric when it’s time to make decisions.

Which helps to explain why spending grew faster under Bush than Obama.

But as bad as Republicans are, there’s no way they could be as bad as the faux Conservative Party in the United Kingdom.

Consider the fundamental debate about whether big government is good and whether we have a moral obligation to maximize the amount of money we turn over to politicians.

Normal people think government is too big and they don’t want to reward a corrupt political class with extra revenue.

And they have strong legal standing for that position. Here’s what Judge Learned Hand famously opined in 1947.

Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.

Judge Hand obviously is correct. It is nonsense to argue that taxpayers have an obligation to pay more than is legally required.

But not everybody is guided by common sense. And if there was a prize for an absence of common sense (as well as a prize for absence of integrity or principles), the David Cameron government in the United Kingdom would be a strong contestant for that award.

Here’s the latest example of the intellectual bankruptcy of that supposedly conservative government. An official was just forced to resign because – prior to joining the government – he advised people to legally minimize their tax liabilities.

I’m not joking. Here’s an excerpt from a Reuters report.

A tax adviser to the British government has been forced to resign after he was recorded giving tips at a conference on how to pay less tax and “keep money out of the Chancellor’s grubby mitts”, a Treasury minister said. The BBC Panorama investigative program filmed David Heaton – before he joined the government as an adviser on how to clamp down on aggressive tax avoidance – telling delegates at a conference how they could exploit tax loopholes. “Mr Heaton’s statements are directly at odds with the government’s approach to tackling tax avoidance,” Treasury minister David Gauke said in a statement. “Therefore, it is right that Mr Heaton resigned from his position.”

David Gauke, by the way, is infamous for having stated that legal tax avoidance strategies “damage our ability to fund public services and provide support to those who need it.” Hmmm….that phrase seems vaguely familiar. I gather the Tory Party thinks government should be guided by “From each according to his ability, to each according to his need.”

Just in case you think I’m pulling a quote out of context, click here or here for additional evidence of the pervasive statism of the current regime in London.

And take a look at this government poster I photographed in the London subway system. Orwell would be proud.

No wonder I”m so glum about the long-run outlook for the United Kingdom.

And the late great Margaret Thatcher must be spinning in her grave.

P.S. I wrote that this was the “latest example” of the Cameron government’s intellectual bankruptcy. For previous examples, see here, here, here, here, and here.

P.P.S. I started this post with the quote from Judge Learned Hand. Leftists, by contrast, like to share the quote from Justice Oliver Wendell Holmes about “taxes are the price we pay for a civilized society.” What they conveniently forget to include is that he made that statement in 1927, when federal taxes amounted to only $4 billion and the federal government consumed only about 5 percent of economic output. Yes, I’ll gladly pay for that amount of civilization.

P.P.P.S. What’s more hypocritical, the supposed conservatives in the U.K. badgering people to pay extra tax or American leftists utilizing tax havens to lower their own taxes?

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One of history’s worst butchers, Josef Stalin, is rumored to have said that, “The death of one man is a tragedy, the death of millions is a statistic.”

Sadly, there’s probably some truth in that statement.

I’ve shared a bunch of horror stories about the U.K.’s government-run healthcare system (see here, here, here, here, here, herehereherehereherehereherehere, here and here) and I challenge you to read them without feeling some mix of anger, sadness, despair, and disgust.

Now read these passages from a story earlier this year in the UK-based Daily Mail.

As many as 1,165 people starved to death in NHS hospitals over the past four years… According to figures released by the Office for National Statistics following a Freedom of Information request, for every patient who dies from malnutrition, four more have dehydration mentioned on their death certificate. …In 2011, 43 patients starved to death and 291 died in a state of severe malnutrition, while the number of patients discharged from hospital suffering from malnutrition doubled to 5,558. …NHS hospitals have also stood accused of fiddling figures to mask the numbers of patients dying needlessly.

Without names, faces, and specific details, it’s easy to read the words, shrug your shoulders, and remain emotionally detached.

“I’m Josef Stalin and I approve government-run healthcare”

But there’s probably a gripping and tragic story for every one of those 1,165 people who died, as well as the 5,558 people who suffered from malnutrition.

You’re probably wondering whether the doctors and nurses in the United Kingdom are especially incompetent and/or inhumane. That may be true, but these nauseating statistics also are the result of a deliberate government policy to hasten death. If you think I’m kidding, read this story about children being put on the “Liverpool Care Pathway.” But only if you have a strong stomach.

Makes you wonder what Paul Krugman was thinking when he asserted that, “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.”

By the way, I’m not implying that the American health care system is the ideal approach. Our system is grossly inefficient and wasteful thanks to government-caused third-party payer.

But with Obamacare being implemented, including the IPAB “death panels,” maybe we’ll have the worst of both worlds. The inefficiency and expense of American-style third-party payer and the clinical cruelty of British-style single-payer.

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In a recent interview with the BBC, I basically accused UK Prime Minister David Cameron of being a feckless and clueless demagogue who is engaged in a desperate effort to resuscitate his political future.

Two peas in a pod

I shouldn’t have been so kind. Cameron manages to combine bad policy and bad morality in a way that is embarrassing even for a politician.

Writing for the Daily Telegraph, Janet Daley eviscerates Cameron’s puerile approach to fiscal policy, beginning with some mockery of his class-warfare approach to tax enforcement.

David Cameron said something last week that was the precise opposite of the truth…the Prime Minister said was: “If you want a low-tax economy, you have to collect the taxes that are owed.” When what he should have said, of course, was: “If you want to collect the taxes that are owed, you have to have a low-tax economy.” Mr Cameron’s statement was one of the more subtle threats contained in the declaration by the G8 – which was pretty much all they could agree on – that they are now the rightful owners of all the wealth produced by anyone except for certain exemptions that they will, subject to minimal notice, decide upon. His remark, presumably designed to provide moral justification for the unprecedented levels of shared surveillance and breaches of data protection that governments are preparing to launch, actually stood on its head the truth about effective tax collection. Which is that the lower rates of taxation are, the less likely it is that payment of them will be avoided or evaded.

She also makes some very astute points about other issues, including the Laffer Curve.

The introduction of the 50p rate of income tax caused two-thirds of those earning a million pounds per year simply to disappear from the reach of HM Revenue & Customs. Whereas under the previous highest tax level of 40p, 16,000 people were prepared to declare earnings of one million pounds, that number shrank to only 6,000 after Gordon Brown, bless him, raised it to 50p. Result: the Treasury lost £7 billion in revenue.

Ms. Daley also comments on tax compliance and the risks of letting governments destroy financial privacy as part of their efforts to undermine tax competition.

If people regard levels of tax as fair (in the true sense of the word, not the Left-wing sense, which actually means “vindictive”), they will not go to expensive and dangerous lengths to escape from paying. The more punitive and discouraging of wealth-creation taxes are, the more they are avoided by stealth or geographical relocation – or by the even more economically disastrous measure of people being disinclined to increase their own productivity. Ah yes, but isn’t this the problem that those heads of government are determined to address? Rather than lowering taxes to levels that those who are taxed find acceptable, they will simply close off all the avenues of escape. There is to be no more possibility, by international agreement (which is to say, the coercion of smaller, less rich countries), of geographical movement for tax advantage.

She closes by opining on why this is really a debate about the burden of government spending and whether taxpayers exist to feed the spending appetites of politicians.

If you eliminate tax competition – if you create a uniform, universally policed tax standard – it is the poorer countries that suffer because they are deprived of the capacity to attract foreign capital. …What is at the heart of all this is the growth of governments: the treasuries of the world are becoming needier and greedier. …Underlying almost all political debate on this matter now is the unspoken assumption that privately owned wealth is inherently evil, and that its only moral justification is to provide revenue that governments can redistribute. …let me remind you of what you may actually believe, shocking as it may sound in the context of prevailing public discourse. Are you ready? It is not the primary function of business to provide funds for politicians to spend.

Amen. The statists and collectivists that dominate the political elite treat us like a herd of cattle to be milked and slaughtered.

We need tax havens in order to impose at least a tiny bit of restraint on the greed of the political class. These low-tax jurisdictions aren’t a sufficient condition to save us from statism, but they sure as heck are a necessary condition.

P.S. Who moved farther in the wrong direction, U.S. Republicans who went from Reagan to Bush or U.K. Tories who went from Thatcher to Cameron?

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I’ve shared this bit of political incorrect terrorism humor from England, as well as this somewhat un-PC bit of tax humor.

But perhaps motivated by the scandal of giving welfare to terrorists, this new video is the most amusing thing I’ve seen from across the ocean.

I almost didn’t post this because it singles out immigrants from the developing world, but since I’ve shared horror stories from home-grown moochers in the U.K., as well as examples of scroungers from Europe who are robbing British taxpayers, I think I’ve covered all the bases.

But in the spirit of inclusiveness, here are other satirical videos worth sharing.

My all-time favorite video satire is from Iowahawk, featuring the Pelosimobile.

And I’ve always thought this left-wing attack against libertarianism is very funny.

And this Tim Hawkins video on the government Candyman is great, as is another version of the song.

Speaking of Tim Hawkins, his home-schooling video is superb.

This spoof of the Chevy Volt also is extremely well done.

Last but not least, here are two brutal Obama teleprompter videos.

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I was very pleased to report the other day that the people of France overwhelmingly favor spending cuts, even when they were asked a biased question that presupposed that Keynesian-style spending increases would “stimulate” the economy.

Now I have some polling data about British voters, though I confess I’m not sure whether to be pleased or worried.

You’ll see below two slides that were presented earlier today at the Bucharest stop on the Free Market Road Show. They’re not from my presentation, but rather from the speech by Matthew Sinclair of the UK-based Taxpayers Alliance.

As you can see from this first slide, the good news is that only 12 percent of British people think government taxes and spends too little.

Sinclair 1

On the other hand, it’s a bit worrisome that nearly 1-in-5 Brits believe in UFOs.

What a bunch of idiots.

Then again, nearly 1-in-3 Americans believe that higher taxes would be used for deficit reduction instead of more spending, and that’s an even more preposterous conclusion.

So I shouldn’t make fun of our English cousins.

Here’s some more good-news/bad-news polling data.

The good news is that only 12 percent of Brits think that the government can pay promised benefits (and I bet that number would fall even lower if they saw this shocking data on the U.K.’s long-run fiscal outlook).

Sinclair 2

The bad news is that 13 percent of Brits think the moon landings were faked.

But since 17 percent of Americans actually admit to having positive feelings about the federal government, I’m reluctant to throw stones since my country is a glass house.

Let me close on a positive note. I’ve expressed considerable pessimism about the future of the United Kingdom, and I think the current leadership of the supposed Conservative Party is terrible.

But maybe there’s reason to hope. It wasn’t that long ago that I shared a very encouraging story from England about civil disobedience against a revenue-hungry government.

And now we know from Matthew’s data that the British people have appropriately jaundiced views of their government.

So perhaps if they ever find another Margaret Thatcher, there’s a 5-percent chance that they can pull themselves back from the fiscal abyss.

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I periodically compare the actions of brainless politicians and bureaucrats in both the United States and the United Kingdom.

One of the most bizarre examples I cited was from England. It showed how a local government decided to install the most pointless sign in the history of the world.

Our British friends are famous for their sense of humor (as illustrated by this glossary of financial terms and this guide to terror alerts in selected nations), so perhaps the sign was meant to be a joke.

Nonetheless, taxpayers picked up the tab.

And now we have another example of incomprehensible government stupidity. Taxpayers in one community just paid to have road markings painted in an alleyway.

I’m not kidding. Check out the photo and this excerpt from a BBC report.

Lines have been painted on both sides of the passageway, off Newhall Street in Swindon, leaving a gap of just 13in (33cm). Nathalie Fisher, a local resident, said it was a “bit of a mystery” as “you couldn’t even fit a motorbike down it.” …The council said local residents had asked the authority to “deal with illegal parking in alleyways”.

Gee, I hope the guy in the picture is being careful. He may get a traffic ticket since his left foot is almost on the double yellow line.

To be sure, I’m not sure this story means that U.K. government official are worse than U.S. government officials. Just look at some of these examples of PC-run-amok and you’ll have plenty of evidence of foolishness on this side of the Atlantic.

The moral of the story is that bureaucrats and politicians want to run our lives, but they’re some of the world’s least competent people.

P.S. While it’s amusing to highlight examples of government stupidity, let’s not forget there are real-life victims of bad government policy in the United Kingdom, particularly if you look at the healthcare system and welfare system.

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The woman who saved the United Kingdom has died.

A Great Woman

I got to meet Margaret Thatcher a couple of times and felt lucky each time that I was in the presence of someone who put her nation’s interests first and was not guided by political expediency.

Such a rare trait for someone in public life.

The best tribute I can offer is to share some of her remarks that capture both her strong principles and her effective communication skills.

Here’s a clip from her famous speech stating that there’s “no such thing as public money.”

Can you imagine today’s spineless Tory politicians making such statements. Hardly, they’re too busy criticizing taxpayers for not voluntarily paying extra tax!

And here’s her powerful performance in the House of Commons exposing the left for being willing to impoverish the poor if it meant those with higher incomes suffered even more.

I’ve said the same thing in some of my interviews, but she obviously said it much more effectively.

P.S. If you weren’t sufficiently inspired by Thatcher’s words, here’s Reagan’s tribute to Coolidge and also a memorable passage from his inaugural address.

P.P.S. Let’s not forget that Thatcher was an indispensable ally with Reagan in the fight against the barbarity of communism.

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I’ve posted some horrifying examples about what happens when you put politicians and bureaucrats in charge of health care.

The story that makes every guy wince comes from Sweden, where a man wound up having his penis amputated because of government incompetence.

And I’ve shared numerous examples of substandard care from the United Kingdom, in part because I can’t resist mocking Paul Krugman.

Speaking of the U.K., here’s a story that may lure some young men into supporting government-run healthcare.

Did taxpayers get good value for their money?

…22-year-old Josie Cunningham recently was approved for breast enhancement surgery that cost more than $7,000, and paid for entirely by taxpayers, reports Opposing Views. Why? Because she told her General Practitioner that being flat-chested was causing her emotional distress. “My GP referred me for the operation because I wasn’t just flat-chested — I didn’t have any boobs whatsoever,” Cunningham said. “I could never go on holiday as I lived in terror of ever being seen in a bikini and could never set foot outside without a padded bra.” Her doctor’s prescription to counter the “emotional distress” was to enhance her breast size from a 32A to 36DD.

I’ve never heard of the website that contains this story, and I’ve never heard of Opposing Views, where it supposedly originated, so I confess to being a bit skeptical of this story.

Then again, who would have guessed that the government in the United Kingdom would provide taxpayer-financed sex trips to Amsterdam? Or that the bureaucrats at the European Commission would be able to get penile implants at public expense?

Closer to home, let’s not forget that Obamacare allows taxpayer-subsidized viagra for sex offenders! And Medicare pays for penis pumps, which creates frightening visual images.

So even if this specific story isn’t true, I have no doubt that the British government has squandered money in similar ways.

P.S. Speaking of breast augmentation, one of the few well-functioning parts of the American healthcare system is cosmetic surgery. Why? Because consumers largely pay out of pocket and, as a result, costs are restrained.

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When we think of Julia, the mythical moocher created by the Obama campaign, our first instinct is probably to grab our wallets and purses. After all, she symbolizes the entitlement mindset, as illustrated by this Ramirez cartoon.

But let’s think of this from Julia’s perspective and speculate about what it will mean for her life. Shouldn’t we worry whether a life on the dole will destroy her spirit?

Or perhaps that question is too abstract, so let’s make it more personal. Would we ever want any of our children and grandchildren to become wards of the state, living empty and hollow lives of dependency and never achieving anything?

The answer is no, of course, because we want our loved ones to have good and happy lives.

So why, then, would anybody want to impose that fate on a stranger? And this isn’t an abstract question. That’s what the welfare state does, every day, over and over again, subsidizing poverty and sloth.

And not just in the United States. I shared a truly sad video a couple of years ago showing how the British welfare state created multi-generational poverty and misery.

Now we have another video, this one from the folks at The Commentator, showing a news report from London that should anger all taxpayers. But it also should upset all people who care about rescuing people from government-induced emptiness.

I’m almost at a loss for words. At the risk of making sweeping judgments based on a short news clip, it appears that this poor woman’s life has been destroyed by government dependency.

And if you’re wondering how someone could ever allow themselves to be caught in the quicksand of the welfare state, don’t forget the story of Natalija, as well the expose about Danny and Gina. They are all healthy young people who made rational economic decisions to mooch since they could enjoy more comfortable lives.

The same thing happens in America. This story from Pennsylvania also shows that it can be far more lucrative to rely on handouts than to climb the economic ladder.

Just in case you think that’s an isolated example, look at this remarkable chart revealing how life on the dole can be much more remunerative than a life of striving and work (you can see similar charts for the U.K. by clicking here).

Let’s return to the woman in the video. I confess that I’m a bit conflicted. Should I feel sorry for Ms. MacDonald or should I look down on her?

The government has wrecked her life with handouts, yet there are probably people just like her who made the choice to avoid dependency and climb out of poverty. If you believe in free will, then she deserves some scorn.

That being said, I’m much more willing to heap abuse on Natalija, Gina, and Danny. They’re young and they should know better. Then again, in 30 years, how will they be different from the woman in the video?

These questions don’t have any good answers, so let’s close with a few examples of how the welfare state subsidizes some truly odd behavior.

And remember, you’re paying for all this!

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The spirit of 1776 is still alive in America. We see it in the Tea Party, which has forced real changes in Washington.

We also see it in little ways, such as the heroic actions of Jay Beeber, who single-handedly killed dangerous red light cameras in Los Angeles.

But I don’t want to be jingoistic. We also find pockets of rebellion against greedy and thuggish government elsewhere in the world.

So even though I’ve made fun of the English for statism and political correctness, I want to share some encouraging excerpts from a story in the UK-based Telegraph.

Meet the NoTo Mob, a group dedicated to fighting what they see as unfair parking tickets and charges. During the week they’re normal blokes (and the odd woman). …But on Saturdays they come together for a common cause. They follow council CCTV cars, or “spy cars”, then stand nearby holding signs to warn drivers about the presence of a CCTV vehicle and potential fine if they break the rules.Motorists pull over, wave or give the thumbs up in gratitude. Complete strangers have been known to hug them in support.

Notomob

Freedom Fighters!

Having been victimized by revenue cameras (which inevitably are set up where speed limits are absurdly low), I would gladly hug one of these blokes if they operated in the United States.

These ordinary men and women fully recognize that these cameras are designed to generate more revenue for government, not to promote safety.

The group targets “honey pots” – high-ticket areas with confusing road markings or unclear signs where the CCTV cars are most likely to operate. …The NoTo Mob…feels motorists are being used as cash cows. “I was near a bus lane and asked drivers who pulled over, ‘Did you see that sign?’ They replied, ‘What sign?’ They didn’t realise. They’d have got a fine if they’d driven down it. “It’s exploiting the average motorist, it’s disproportionate and it’s plain wrong. It’s highway robbery.”

Since I’m praising our English cousins, I suppose it’s also appropriate to give credit to the English government for not outlawing the NoToMob.

In the United States, I’m embarrassed to admit, you can get in trouble for warning other motorists about speed traps.

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I just finished up a trip to London.

In previous posts, I’ve expressed pessimism about the future of the United Kingdom, largely because all political parties have a statist mentality.

I criticized Gordon Brown, the former Labor Party Prime Minister, for being a compulsive redistributionist, big spender, and taxaholic.

But nothing’s really changed under Tory leadership. David Cameron is a vacuous statist, undermining the Conservative Party in the same way that George W. Bush eroded the brand name capital of the Republican Party.

This sign was on a train I rode today. It is sponsored by the UK version of the IRS,  and it pretty much symbolizes how the United Kingdom has turned into a predatory state.

UK Tax Orwell

The United Kingdom is in terrible fiscal shape. Government spending has reached record levels, and now consumes a larger share of economic output than the public sectors in failed welfare states such as Spain.

And what are taxpayers getting for their money, other than Orwellian signs?

Not much. They get an increasingly dysfunctional society filled with scroungers such as Natalija, Gina and Danny.

They also get a healthcare system that seemingly prides itself on maltreatment, and a tax system that is more designed to be punitive rather than to generate revenue.

Though the UK government does provide taxpayer-financed sex tours to Amsterdam, so at least a few people are getting screwed as a result of government rather than by the government.

But let’s close by contemplating the mindset of a government that would post such a sign. We already know that Prime Minister Cameron and some of his senior deputies think it’s wrong to engage in legal tax avoidance.

And this is a government that is brainwashing kids into becoming servile snitches, and is even considering a system that would have employers send paychecks to the state and then the government would decide how much to send to taxpayers.

Such a shame since so much of what is good in the Western World came from England.

P.S. This is also a country where they send innocent people to jail for shooting burglars.

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I posted a horrifying story last week about a Lithuanian immigrant who was mooching off British taxpayers.

She basically had a very comfortable life thanks to beleaguered taxpayers, and I compared her to a Greek woman who thought the state owed her everything.

But there’s no ethnic requirement to be a bum. I’ve also shared stories about American moochers and Austrian moochers.

I’ve even shared stories about terrorists getting welfare handouts in Australia and France!

UK BumsSo I hope my British friends won’t be upset that I’m now going to highlight a couple of English deadbeats.

Here are some odious details from the UK-based Sun.

Danny Creamer, 21, and Gina Allan, 18, spend each day watching their 47in flatscreen TV and smoking 40 cigarettes between them in their comfy two-bedroom flat. It is all funded by the taxpayer, yet the couple say they deserve sympathy because they are “trapped”.

Does this mean they are imprisoned? Is someone holding them at gunpoint?

Hardly. It simply means that these two scroungers get such lavish handouts that their living standards would fall if they actually lived decent and honorable lives and went to work.

The couple, who have a four-month-old daughter Tullulah-Rose, say they can’t go out to work as they could not survive on less than their £1,473-a-month benefits. The pair left school with no qualifications, and say there is no point looking for jobs because they will never be able to earn as much as they get in handouts. Gina admits: “We could easily get a job but why would we want to work — we would be worse off.” Danny’s father, 46, even offered him a job with his bowling alley servicing company — but could not pay him enough.

So how much are these moochers stealing from taxpayers? Quite a lot, particularly if you keep in mind that £1 is equal to $1.57.

The couple, who live in Hants, receive £340 a week, made up of £150 housing benefit, £60 child tax credit, £20 child benefit and £110 in Job Seeker’s Allowance. They pay just £25 towards their spacious £625-a-month home. Their lounge is dominated by the huge TV and a leather sofa. …They spend the same on tobacco as they do on their daughter’s milk and nappies.

Gee, isn’t that nice. Taxpayers are even financing their cigarettes.

I blame Danny and Gina for being a couple of bums, but I also blame British politicians for creating a lavish welfare state that enables this awful behavior.

It’s not that people are trapped in poverty, but they definitely are lured into dependency.

By the way, the same problem exists in the United States. Indeed, this chart shows that the plethora of freebies from taxpayers means a household can be better off with $29,000 of income rather than $69,000 of income.

No wonder the poverty rate stopped falling once the so-called War on Poverty began.

For more information, here’s a short debate I had about the topic, and here’s a video explaining how the welfare state is bad for both poor people and taxpayers.

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The welfare state creates some amazingly pathetic and disgusting individuals.

But I’ve never found a match for Olga, a Greek woman who thinks it is government’s job to take care of her from cradle to grave.

At least not until now. I’m excited to announce that Olga has a soulmate named Natalija. She’s from Lithuania, but she now lives in England, and she doubtlessly will inspire Olga on how to live off the state.

UK Welfare Horror StoryHere’s some of what The Sun reported about this very successful moocher.

Natalija Belova, 33, told The Sun how she spurns full-time work — yet can afford foreign holidays and buys designer clothes. The Lithuanian said: “British benefits give me and my daughter a good life.” She has milked soft-touch Britain for £50,000 in benefits and yesterday said: “I simply take what is given to me.”

And what is given to her? Quite a lot.

The graduate, who became a single mum after she arrived here, rakes in more than £1,000 a month in handouts — £14,508 a year — to fund her love of designer clothes, jaunts to the Spanish sun and nightclubbing. She bragged: “I have a lovely, fully-furnished flat and money to live properly on. …Her handouts total £279 a week — with housing benefit contributing £183, child tax credit adding £56, child benefit £20 and her council tax being paid to the tune of £20.

UK Welfare HandoutsYou might expect Natalija to be grateful, but you’d be wrong.

But she does have one criticism. Natalija moaned: “I think they should help pay for private nannies, rather than just free nursery.” …Natalija vowed: “I am not going to work like a dog on minimum wage.” She added: “I don’t care what anyone thinks. I’m not doing anything wrong. “I know people won’t like to read this, but what would they do? “Would they not take the money that was being handed to them to stay with their child all day?”

I’ve written about the benefits of tax competition between nations. Well, this story shows the perverse impact of welfare competition between countries.

Speaking at her two-bedroom pad that came fully furnished in Watford, Herts, courtesy of the taxpayer, grateful Natalija said: “In Lithuania the benefits system does not pay enough. “I have a friend over there who is a single mother. “She only gets £20 a month in child benefit, plus some discounted help with gas and electricity — and some housing help. “It’s not enough to keep a normal level of life, like here. “If I was on benefits there, I couldn’t afford nice clothes or the holidays abroad.” She went on: “I am sure people will say I should return to Lithuania. But that won’t be happening. Being in Britain offers me far better benefits.”

We also have a remarkable example of labor supply economics. This is the real-world example of these charts showing how the British welfare state destroys incentives.

She is careful to work fewer than 16 hours a week so that the benefits keep rolling in. But her wages boost her income to more than £400 a week. On top of that she gets free childcare, fruit and milk vouchers — and even a clothes allowance for “job interviews”. Natalija said: “It is a strange system in this country. Basically, the fewer hours I work, the more I can earn on benefits. But that’s the way it is and it is not my fault.” …She insisted she would be prepared to get a full-time job — but only if the salary tops £25,000. …”Some people may think I am picky. But I am a realist. I need a full-time job that pays at least £25,000 — that is just enough to cover all my living costs that benefits currently pay for. “Otherwise working full time is not worth my while. “If I worked full time, I’d have to pay for childcare costs as well as rent and all my bills. “The benefits system in this country means that I do not have to do this.”

By the way, here’s a chart showing the same destructive policies in the United States.

Let’s look at one last excerpt about Natalija. British taxpayers can take comfort in the fact that this human tick is living a nice life.

In September she escaped the dreary British summer by jetting off with her daughter for a sun-kissed week in Spain. Last month she enjoyed a second holiday — back in her Lithuanian homeland. Natalija, who has three credit cards and loves to go on sprees at designer clothes stores, crowed: “After our holiday to Malaga, we went to Lithuania over Christmas and spent £1,000.” She continued: “I love to buy clothes on my credit cards and often have a blow-out at stores like Roberto Cavalli and the Armani Exchange. …”I also enjoy going to nightclubs and parties with my friends. It’s important to go out and get dressed up. It’s good for my self-esteem.”

Her self esteem has been boosted? Oh, joy!

And I can just imagine how much self esteem her daughter will have after growing up with a moocher for a mother.

John Hinderaker of Powerline was first on this horrific story and his analysis is very much worth reading as well. But since imitation is the sincerest form of flattery, I figured I would share the story and add some of my thoughts.

By the way, if you want more than just horrifying anecdotes, click here for a video that looks at the dismal impact of the American welfare state and click here to see how Obama has exacerbated the negative effects of such policies in America.

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Just like in the United States, politicians in the United Kingdom use the deceptive practice of “baseline budgeting” as part of fiscal policy.

This means the politicians can increase spending, but simultaneously claim they are cutting spending because the budget could have expanded at an even faster pace.

Sort of like saying your diet is successful because you’re only gaining two pounds a week rather than five pounds.

Deliberately gullible?

Anyhow, some people get deluded by this chicanery. Paul Krugman, for instance, complained in 2011 that “the government of Prime Minister David Cameron chose instead to move to immediate, unforced austerity, in the belief that private spending would more than make up for the government’s pullback.”

This was nonsense. There have not been any genuine budget cuts in the United Kingdom. Heck, just compare what’s happening today in the United Kingdom and what happened in Canada in the 1990s to see the difference between gimmickry and real fiscal restraint.

Now we have some new numbers that confirm that the UK economy is suffering because of a heavy burden of government spending.

Here’s some of what Allister Heath, the Editor of City A.M., wrote for the UK-based Telegraph.

The public finances are deteriorating again, making a mockery of the Coalition’s core purpose. Osborne’s fatal problem is that he is proving unable to deliver any meaningful reduction in the size of the state. The extent of his failure will come as a shock to many. Remarkably, public spending actually went up last year as a share of our national income… public spending hit 49pc of UK GDP last year, a shocking increase on the 48.6pc of GDP spent by the state in 2011. Even with a stagnant economy, this implies that Osborne has lost control of public spending.

Gee, doesn’t sound like much budget cutting to me.

Heck, the burden of government spending is worse than it is in Germany (45 percent of GDP). Or even Spain (44 percent) or Portugal (47.4 percent).

Perhaps the most shocking number is the one showing that the UK has radically veered in the wrong direction this century.

Public spending as a share of GDP hit a trough of just 36.6pc in 2000.

Allister hits the nail on the head.

…after all the rows about “slashing spending to the bone”, and following almost three years of coalition government, the state is still spending around half of national income. …it beggars belief that a government that remains so large, so bloated cannot provide much better quality services, and that we have a public debate in this country that exaggerates beyond all recognition the extent of the state’s downsizing.

But there has been some “austerity,” but only for taxpayers.

…real austerity is only biting on the tax side: total UK government revenues increased from 40.3pc of GDP in 2011 to 42.4pc in 2012, the OECD estimates. It’s getting increasingly hard for the Chancellor to extract revenues, with taxes on income and wealth falling to £194.3bn over 2012 as a whole, 2.7pc lower than in 2011, when they stood at £199.7bn, according to separate figures from the Centre for Economics and Business Research.

That last sentence, by the way, shows the Laffer Curve in action.  The supposedly Conservative government of Cameron and Osborne has raised the tax burden, yet revenues aren’t materializing.

Allister also echoes the argument of Veronique de Rugy about choosing the right kind of austerity and reining in the public sector.

Not all kinds of austerity were created equal: cutting current expenditure, such as benefits, is good for growth; but hiking taxes is bad for it… There is also lots of evidence that elevated levels of public spending and large government debts are bad for GDP; no wonder, therefore, that growth is failing to materialise.

So what’s the bottom line? Well, as Allister stated, the real problem is that government is too big and spending too much.

And until Cameron and Osborne are willing to tackle that problem, don’t expect much positive from the United Kingdom.

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I’ve shared several horror stories of government incompetence and bureaucratic nonsense as part of my series comparing stupid policies in the United States and United Kingdom.

This has been a neck-and-neck battle, with the United Kingdom recently throwing down the gauntlet with a decision to take kids away from their foster family because the mom and dad didn’t believe in unlimited immigration.

The United States responded by paying to have a bunch of bureaucrats attend a conference so they could learn how to respond to a zombie attack.

I’m not sure which of those decisions wins the prize for government stupidity, but today’s story suggests that it’s time to start chanting “U-S-A, U-S-A.”

After all, surely the United Kingdom can’t surpass the moronic decision by Maryland school bureaucrats to suspend a little boy for pretending his hand was a gun and “shooting” another child.

Here’s all you need to know, as reported by the Washington Examiner, about this laughable – yet nauseating – example of nanny-state political correctness.

Child Hand-Gun

I guess he should play with dolls instead

A Montgomery County elementary school student was suspended for a pretend gunshot… The 6-year-old, who attends Roscoe R. Nix Elementary School in Silver Spring, made a gun with his hands, pointed it at another student and said “pow,” according to Robin Ficker, the boy’s attorney. He was given a one-day suspension, with a conference on the matter planned for Jan. 2, the day students return to school from winter break.

This is not an isolated incident. There are other examples of embarrassing stupidity in America.

Seems like the United States wins this contest for government stupidity.

But, wait, maybe I was blinded by patriotism. Perhaps I wanted America to win and that caused me to overlook equally inane decisions in the United Kingdom.

Indeed, that was the case. Showing that stupidity can reign supreme on both sides of the Atlantic, it turns out that two boys in England were reprimanded for make gun shapes were their hands.

But that’s not all. There have been other idiotic episodes of anti-gun lunacy in the United Kingdom.

And let’s not forget the woman who got in trouble with the police for trying to scare away some thugs by brandishing a knife in her own home.

So I guess that means we still have a tie. In the contest for government stupidity, the United States and the United Kingdom are both winners.

And the citizens of both nations are losers, but let’s not allow that pesky little fact take away from this exciting contest.

P.S. You probably won’t be surprised to learn that Montgomery County is a suburb of Washington, DC. And, as you can see from this map, it is filled with overpaid bureaucrats and lobbyists. Since these are the people imposing so much bad policy on the rest of the nation, at least they’re being consistent and subjecting themselves to foolishness as well.

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I wrote yesterday about a silly proposal in the United Kingdom to ban long kitchen knives.

Some people objected because the story was from last decade, but that misses the point. Proponents of the Second Amendment are vigilant against encroachments in part because we’re worried about the slippery slope.

I predicted in yesterday’s piece that at some point the Brits would resort to banning long knives. I hope I’m wrong, but my prediction is based on what the U.K. government has done with gun control.

Ever since 1920, the government has made it more and more difficult for law-abiding people to possess weapons. And in a perverse example of Mitchell’s Law, the failure of one policy is then used to justify the next policy.

That’s how proposals that sound radical and foolish sometimes get implemented many years later.

We don’t know if this will lead to a knife ban at some point, but we can look at evidence showing that gun control in the U.K. was a precursor for a gun ban. And we also know such policies don’t reduce crime.

Professor Joyce Lee Malcolm of George Mason University has a column in the Wall Street Journal, looking at the impact of anti-gun policies in the United Kingdom.

…the Firearms Act of 1998…instituted a nearly complete ban on handguns. Owners of pistols were required to turn them in. The penalty for illegal possession of a pistol is up to 10 years in prison. The results have not been what proponents of the act wanted. Within a decade of the handgun ban and the confiscation of handguns from registered owners, crime with handguns had doubled according to British government crime reports. Gun crime, not a serious problem in the past, now is. Armed street gangs have some British police carrying guns for the first time.

By the way, it’s not just gun crime that has gone up. The U.K. has become a much more dangerous and violent society – almost surely in part because the thugs don’t have to worry about armed resistance.

Heck, if you are one of the few legal gun owners in the nation and you shoot a burglar, you get arrested instead of a pat on the back.

The U.K.’s draconian restrictions on individual liberty lead to some Orwellian consequences. Professor Malcolm offers up two examples.

Meanwhile, law-abiding citizens who have come into the possession of a firearm, even accidentally, have been harshly treated. In 2009 a former soldier, Paul Clarke, found a bag in his garden containing a shotgun. He brought it to the police station and was immediately handcuffed and charged with possession of the gun. At his trial the judge noted: “In law there is no dispute that Mr. Clarke has no defence to this charge. The intention of anybody possessing a firearm is irrelevant.” Mr. Clarke was sentenced to five years in prison. A public outcry eventually won his release. In November of this year, Danny Nightingale, member of a British special forces unit in Iraq and Afghanistan, was sentenced to 18 months in military prison for possession of a pistol and ammunition. Sgt. Nightingale was given the Glock pistol as a gift by Iraqi forces he had been training. It was packed up with his possessions and returned to him by colleagues in Iraq after he left the country to organize a funeral for two close friends killed in action. Mr. Nightingale pleaded guilty to avoid a five-year sentence and was in prison until an appeal and public outcry freed him on Nov. 29.

Amazing…and nauseating. I already had written about the unjust treatment of Mr. Clarke, but Mr. Nightingale’s legal nightmare is just as absurd.

Gun Control Cartoon Drug WarGun control laws are utterly perverse. They don’t work, just like prohibition didn’t work in the 1920s, and just like today’s Drug War is an unmitigated failure.

Gun bans turn law-abiding people into criminals, while simultaneously making life easier for the low-life scum of society.

And as the welfare state begins to fall apart and civil unrest becomes more common, the deadly impact of these bad policies will become even more apparent.

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Back in my less sophisticated days (shocking as it may seem, I wasn’t always the mature, statesmanlike figure I am today), I sometimes resorted to silly arguments when debating gun control, such as, “does this mean you want to ban knives since they also can be used to kill people?”

Smarter opponents would scoff and accuse me of knocking down straw men, assuming a non-existent slippery slope, or engaging in reductio ad absurdum.

I wasn’t even sure what the last one meant, but I secretly felt chagrined because I also thought the argument was nonsense. But it’s not like we had the Internet back in those days so I could quickly peruse the writings of John Lott or David Kopel.

Well, I no longer need to feel shame. It turns out that my straw man came to life and he’s sliding down a slope into a big pool of whatever that reductio thing is.

I kid you not. There’s a supposedly civilized nation that is seriously talking about banning long kitchen knives.

I’ll give you a couple of hints to help you figure out what country is considering this bizarre policy.

Yes, I’m talking about our friends in the United Kingdom.

They make some decent movies and they have cute accents, but they seem totally clueless about how to fight crime and the notion of individual rights appears to be a totally alien concept.

So the nation that once ruled half the world actually has contemplated whether to ban certain kitchen knives. Here are some details from a 2005 BBC report.

A&E doctors are calling for a ban on long pointed kitchen knives to reduce deaths from stabbing. …The research is published in the British Medical Journal. The researchers said there was no reason for long pointed knives to be publicly available at all. …The researchers say legislation to ban the sale of long pointed knives would be a key step in the fight against violent crime. …Home Office spokesperson said there were already extensive restrictions in place to control the sale and possession of knives. “The law already prohibits the possession of offensive weapons in a public place, and the possession of knives in public without good reason or lawful authority, with the exception of a folding pocket knife with a blade not exceeding three inches. … A spokesperson for the Association of Chief Police Officers said: “ACPO supports any move to reduce the number of knife related incidents, however, it is important to consider the practicalities of enforcing such changes.”

Given my low opinion of and low expectations for Britain’s political class, I’m impressed that pocket knives are still legal. It’s probably just a matter of time before than changes. After that, the next step will be fingernail clippers.

And I’m glad that the ACPO person warned that there might be problems enforcing such a silly law.

But I fully expect to see that foolish proposal get enacted at some point. After all, this is the country where a women who was being threatened by thugs got in trouble with the police for brandishing a knife in her own home.

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Back in 2011, I linked to a simple chart that illustrated how handouts and subsidies create very high implicit marginal tax rates for low-income people and explained how “generosity” from the government leads to a tar-paper effect that limits upward mobility.

Earlier this year, I shared an amazing chart that specifically measured how the welfare state imposes these high implicit tax rates. Unbelievably, some people would be better off earning $29,000 rather than $69,000.

Simply stated, the multitude of redistribution programs are worth a lot of money, but you begin to lose those goodies if you begin to live a productive and independent life.

And since we know that rich people respond to high tax rates by declaring less income to the government, we shouldn’t be surprised that poor people also respond to incentives.

We also shouldn’t be surprised to learn that other nations have these same perverse policies. Here are some excerpts from a powerful piece for the UK-based Spectator.

…today’s Sunday Times magazine has a long piece asking whether there is a “fundamental difference in our attitudes to work”. It’s still one of the most important questions in Britain today: what’s the use of economic growth if it doesn’t shorten British dole queues? And should we blame these industrious immigrants; aren’t the Brits just lazy? …The quality of the British debate is so poor that we almost never look at this from the point of view of the low-wage worker. Every budget, the IFS will dutifully work out if it has been “fair” – ie, gives the most to the poorest. The LibDems will judge a budget by this metric. That’s a nice, easy, simple graph. But what about destroying the work incentive? Each budget and each change to tax should be judged on how many people are then ensnared in the welfare trap. I adapted the below (nasty, complex) graphs from an internal government presentation, which still make the case powerfully. The bottom axis is money earned from employer and the side axis is income retained. The graphs are complex but worth studying, if only to get a feel for the horrific system confronting millions of the lowest-paid in Britain today.

Here are the two charts. the author is correct. They are quite complex. But they show that there’s no much incentive to work harder, whether you’re a young person or a single parent.

After showing these amazing charts, the author makes some very powerful additional observations.

…if I was in a position of a British single mother I have not the slightest doubt that I would choose welfare. Why break your back on the minimum wage for longer than you have to, if it doesn’t pay? Some people do have the resolve to do it. I know I wouldn’t. …So let’s not talk about “lazy” Brits. The problem is a cruel and purblind welfare system which still, to this day, strengthens the welfare trap with budgets passed without the slightest regard for its effect on the work incentives on the poorest. …Meanwhile, the cash-strapped British government is still creating still the most expensive poverty in the world.

The final sentence in the excerpt really sums it up, noting that the government is “creating the most expensive poverty in the world.” Sort of like a turbo-charged version of Mitchell’s Law. The politicians create a few redistribution programs. Poverty begins to get worse. So then they add a few more handouts to address the problems caused by the first set of programs. Lather, rinse, repeat.

In other words, this poster applies in all nations.

P.S. If you want some real-world examples of the horrible impact of the British welfare state, you can see how the welfare state destroys lives, creates perverse incentives, and turns people into despicable moochers.

P.P.S. We have the same problems in America, and even leftists are beginning to admit this is bad for poor people. Heck, just look at this chart showing that the poverty rate was falling until the War on Poverty began.

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I don’t like bloated government. It undermines economic performance by diverting resources from the productive sector of the economy and often leads to destructive tax policy.

But when trying to build support for good fiscal policy, it often helps to cite specific examples of wasteful and foolish government. That’s one of the reasons I’ve been comparing examples of government stupidity and political correctness in the United States and the United Kingdom.

After all, how many people would want to pay more taxes after reviewing these bizarre episodes of government in action?

From the United Kingdom

From the United States

I’ve even shared some instances of moronic behavior from the private sector, and I have another story that may belong in that category.

In this instance, we’re talking about the critical need to protect people from pudding. I’m not joking. Here are some of the details of a very odd report in the Daily Mail.

If you’re lucky enough to look about 18, there’s a good chance you’ll be asked to provide ID at the supermarket to buy alcohol, knives or glue. Now an addition has been made to that list of potentially hazardous items – chocolate pudding. Robert Nemeti was amazed when he was asked for ID while buying a microwaveable pudding at Tesco. Mr Nemeti, 24, was going through the self-service checkout when an on-screen warning announced that his purchase had to be ‘approved’. …‘The woman who was monitoring the self-service checkouts came over and asked me for identification showing I was 18. I asked her why and was stunned when she told me: “It gets hot when you cook it – and you may burn yourself”. Surely the same can be said of many of the products they sell in any supermarket? Health and safety has gone crazy if you now have to prove you can be trusted with a chocolate pudding.’ He added: ‘I explained that I didn’t have any ID. Thankfully she agreed that I looked over 18 and she scanned her staff pass to approve the sale.’ Mr Nemeti managed to cook and eat the dessert that evening without injury.

Gee, I’m glad that Mr. Nemeti managed to eat the pudding without causing a fire or suffering burns.

There’s not much I can add to this story. Is this an example of crazy government over-protectiveness, sort of nanny state run amok? Perhaps somewhat similar to Nurse Bloomberg’s attempt to ban large sodas? I don’t know. There aren’t enough details.

Or maybe it’s the fault of the private sector, with some corporate bureaucrat justifying his job by coming up with idiotic rules? Though, to be fair, that’s less destructive than American corporate bureaucrats who have special skills when it comes to getting bailout money.

No warning label?!? Such reckless corporate irresponsibility!

Could it be because the English are learning about America’s lawsuit culture and businesses are having to defend themselves from preposterous legal claims by imposing equally preposterous rules? That would be the indirect fault of government.

But whatever the cause, it’s a sorry sign for civilization. I’ve previously explained that I’m very pessimistic about the United Kingdom’s fiscal outlook. Based on this story, I also should worry about the nation’s mental outlook.

But I’m not throwing stones blindly. I’m fully aware that the United States is a glass house, whether the metric is reckless fiscal policy or a dearth of common sense.

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Obama’s main goal in the fiscal cliff negotiations is to impose a class-warfare tax hike.

He presumably thinks this will give the government more money to spend, but recent evidence from the United Kingdom suggests that he won’t get nearly as much money as he thinks.Laffer Curve

Why? Because there’s this thing called the Laffer Curve. It shows that it is naive to believe that there is a linear relationship between tax rates and tax revenue. To accurately predict what will happen to revenues when there is a change in tax policy, you also have to estimate what will happen to taxable income.

And when you’re trying to stick it to the “rich,” you need to understand that they have tremendous control over the timing, level, and composition of their income. So unlike the rest of us, they can respond very easily when the government goes after them.

The Wall Street Journal opines on what recently happened across the Atlantic.

A funny thing often happens on the way to soaking the rich: They don’t stick around for the bath. Take Britain, where Her Majesty’s Revenue and Customs service reports that the number of taxpayers declaring £1 million a year in income fell by more than 60% in fiscal 2010-2011 from the year before. That was the year that millionaires became liable for the 50% income-tax rate that Gordon Brown’s government introduced in its final days in 2010, up from the previous 40% rate. Lo, the total number of millionaire tax filers plunged to 6,000 in 2010-2011, from 16,000 in 2009-2010. The new tax was meant to raise about £2.5 billion more revenue. So much for that. In 2009-2010 British millionaires contributed about £13.4 billion to the public coffers, or just under 9% of the total tax liability of all taxpayers that year. At the 50% rate, the shrunken pool yielded £6.5 billion, or about 4.4%.

In case you think this is just a special case, the United States conducted a similar experiment in the 1980s, except we lowered tax rates instead of raising them. And as you can see in this “lesson” post I wrote for the President, we got the same results as the United Kingdom, except in reverse. More rich people, more taxable income, and more tax revenue.

Here’s a chart showing what happened in the U.K. It shows tax revenue for the 2009-2010 fiscal year, followed by a projection for 2010-2011, and then the real-world numbers.

UK Laffer Curve

Now time for some important caveats. There are lots of things that determine taxable income for the rich, so we have no way of precisely knowing the extent to which the higher tax rate caused taxable income – and therefore tax revenue – to fall. The economy’s weak performance may have played a role, though the recession in the U.K. occurred in 2008 and 2009, so you would expect taxable income to climb for the 2010-2011 fiscal year.

It’s also possible that some of the revenue loss was the result of income shifting rather than a genuine decline in the amount of economic activity.

But we do know that the same pattern keeps appearing in nation after nation, whether we’re looking at Italy, France, or Spain. Or states such as IllinoisOregonFlorida, Maryland, and New York.

You mess with the Laffer Curve and it will get its revenge.

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I’m not easily grossed out or nauseated. Heck, I’m on email lists for a half-dozen softball teams and you can only imagine the strange/filthy/nasty things that guys send to each other.

But I read a story about the death panels in the United Kingdom that left me discombobulated. I can’t even begin to describe how I feel.

Here’s the intro of a disturbing report in the Daily Mail.

Sick children are being discharged from NHS hospitals to die at home or in hospices on controversial ‘death pathways’. Until now, end of life regime the Liverpool Care Pathway was thought to have involved only elderly and terminally-ill adults. But the Mail can reveal the practice of withdrawing food and fluid by tube is being used on young patients as well as severely disabled newborn babies.

And here are some of the horrifying details. Read at your own risk.

One doctor has admitted starving and dehydrating ten babies to death in the neonatal unit of one hospital alone. Writing in a leading medical journal, the physician revealed the process can take an average of ten days during which a  baby becomes ‘smaller and shrunken’. The LCP – on which 130,000 elderly and terminally-ill adult patients die each year – is now the subject of an independent inquiry ordered by ministers. …Earlier this month, an un-named doctor wrote of the agony of watching the protracted deaths of babies. …‘I know, as they cannot, the unique horror of witnessing a child become smaller and shrunken, as the only route out of a life that has become excruciating to the patient or to the parents who love their baby.’ Grim Reaper with Kid…Bernadette Lloyd, a hospice paediatric nurse, has written to the Cabinet Office and the Department of Health to criticise the use of death pathways for children. She said: ‘The parents feel coerced, at a very traumatic time, into agreeing that this is correct for their child whom they are told by doctors has only has a few days to live. It is very difficult to predict death. I have seen a “reasonable” number of children recover after being taken off the pathway. …‘I have also seen children die in terrible thirst because fluids are withdrawn from them until they die. ‘I witnessed a 14 year-old boy with cancer die with his tongue stuck to the roof of his mouth when doctors refused to give him liquids by tube. His death was agonising for him, and for us nurses to watch. This is euthanasia by the backdoor.’

My first reaction is to hope that this story is wildly wrong, filled with exaggerations and lies.

My second reaction (and this is why I got so agitated) is to imagine what it must be like for the parents. They get talked into letting their kids die, which must be agonizing, and then (assuming they stick around) they have to watch them slowly starve to death or die of thirst. Wouldn’t it be better to just give your kid a fatal injection? Setting aside the moral issue of deciding to let a kid die because he’s disabled or something like that, doesn’t simple decency mean that death should be painless rather than agonizing?

My final reaction is to wonder what Paul Krugman would say about this scandalous neglect and mistreatment. During the Obamacare debate, he told us we could ignore stories about what was happening across the ocean, writing that “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.” So I guess starving children don’t qualify as a scare story.

P.S. If you want more horror stories about government-run healthcare in the United Kingdom click here, here, here, here, herehereherehereherehereherehere, here and here.

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