UKIP’s latest offering to the voters
This week UKIP spelt out their new tax policy. The overall aim of this would be to make our tax policy ‘flatter, simpler and lower’. As part of this they would raise the personal allowance before taxation kicks in to take all of those on minimum wage out of tax, raise the wage you start paying 40% tax to £45,000 and to abolish the 45% rate of tax altogether.
This presents our other political parties with a problem. Firstly because it appeals to people. Everyone would like to keep more of their hard-earned money, whether they earn minimum wage or hundreds of thousands of pounds. It’s very politically hard to oppose a tax cut. Labour can say that it’s a further tax cut for millionaires, but cannot ignore taking the very poorest out of tax altogether, which most would agree is a noble aim. The Conservatives are unable to oppose it because their grassroots are vastly in favour of such policies and opposition would only enhance the loss of constituency members to UKIP.
The second part of this problem is that it still has to be opposed by both. UKIP have claimed that this will cost £6bn and that they can easily cover this by cutting the £11bn development budget. Whether or not you agree with cutting the development budget this £6bn figure is surely an underestimate. The latest released information I could find is that the forecast tax and national insurance contributions for 2013-14 would be £573.5bn. Is it credible to say that these changes will only cost 1.05% of that? If so then why has nobody thought of it before? As I said it’s a very popular idea and the Conservatives would love to do it, so why not?
It’s surely therefore reasonably fair for us to assume that it would cost more than £6 billion. This is why it has to be opposed. There just isn’t enough money around for us to start cutting taxes. There is an argument to be had about how to reduce the deficit and what to do afterwards – whether to carry on cutting and pay down the debt or accept that level of debt and just not add any more to it. However, we are now forecast to be spending more than £70bn a year on debt repayment alone, by the 2020 election. This is easily more than we currently on education, twice as much as we do on defence and roughly what we spend on pensions. These are massive amounts of money just to keep our head above water as a country. No Government should, or ultimately will, accept one of their largest spending commitments being paying interest on debt.
All parties have to get real and for the most part they have. There is an acceptance that budget changes have to be made, with Labour now saying that they would seek to just make the changes in a fairer way.
The problem here is how our modern democracy works and it explains the rise of UKIP. The issue is that the public don’t want realism from politicians, they want to be told what they already think. They want to be agreed with.
In May 2013 UKIP broke from their European mould and announced themselves on the stage of local politics, this was followed by their triumph in the European elections last May which saw UKIP solidify their place in British politics. They’ve done this by patting the electorate on the head, and saying exactly what they want to hear.
This is the sort of politics that we like in the short-term but isn’t in our long-term benefit. We might well look back, in time, and regret it but we will vote for it at the election because it just sounds so good.
What has always happened with politics is that as soon as a difficult but necessary decision needs to get made, such as the local authority needs to shut its pool or library because nobody’s using it, another party will turn up and campaign against the closure. This side that campaigns against it will win votes because it’s what the local people want at that moment in time.
This is then followed logically by one of three things; other things get cut (and the system repeats itself, meaning nothing gets cut), you raise taxes or you borrow money. This isn’t good for us in the long run, but it gives us what we want in the short run. Political parties can only ever look at the short run because the next election is only ever a few years away. Whoever tells us what we want to hear gets our votes, but it can lead to an even worse long-term outcome.
This wasn’t too damaging during the ‘good years’ of most of the 1990’s and up until 2008. Now however we are in an unprecedentedly bad fiscal situation. Previous generations have been happy for many years to please themselves with short-term fixes to problems. You can borrow more money here, raise taxes there, but people shouldn’t worry because everyone will keep earning more money. It will always be better tomorrow.
But, we are now in a place where this doesn’t seem so likely.
It is unavoidable that the younger generations, and ones not yet born, are going to be paying back the national debt throughout their entire lives, while simultaneously faced with the prospect of lower wages and lesser public services. All of this to pay for the profligacy of those who have come before them, while no one who has left school, college or university after 2007 will have experienced the benefit of what they’re paying for.
This is politically unpalatable. Cuts and austerity are electorally unpopular. People don’t vote to be left worse off. They will vote for anyone who tells them it ain’t so, that you can have tax cuts for everyone and it’ll be fine because we’ll just cut the development budget. But we’re in a situation where none of the usual parties are able to take advantage. The Conservatives are in power and untrusted so they don’t want to make unrealistic promises. Labour are concerned that if they promise too much it will be all the more embarrassing when they have to continue the ‘Tory cuts’ if they win in 2015. They know that the only tax that is popular is a banker’s tax, but there’s a finite amount of money you can get from even bankers. Meanwhile the Lib Dems have learnt their lessons of overpromising on the assumption they’ll never be in power, and know that charges of hypocrisy will stick if they try and U-turn too much.
However this hasn’t lessened people’s desire to be satisfied in the short term. The country is currently flailing around looking for an alternative because they’re not hearing any good news from the 3 best known parties.
Enter UKIP. They are expert at telling people what they want to hear. As soon as we leave the EU, which strangles our entrepreneurs with red tape and ‘swamps us’ with those pesky immigrants who clog up our NHS – when they actually keep it running – and claim all those benefits – when they’re much less likely to claim than the British. In the last few years they’ve expanded their attack to include the overseas aid budget because many people don’t like the sound of giving away our money to possibly corrupt foreign governments when we’re suffering at home, despite the department taking up around 1% of Government spending. The real reason it’s used is because it is the last uncontroversial cut that can be used to justify giving people what they want, without upsetting domestic voters who rely on education, health or welfare spending.
Many British people hear UKIPs ideas and think ‘thank God’. It’s not as bad as everyone else has been saying. We can have a tax cut and it won’t actually impact anything in my life or anyone I know. There must always be a simple solution so let’s vote UKIP, ‘get our country back’ and we’ll see that nothing has irrevocably changed. We can also cut taxes while increasing spending on defence and the NHS, doesn’t that sound nice?
But it has changed. UKIP provide no realistic alternative solution, mainly because there is no alternative solution, they’re only chasing votes now, and they’ll think of realistic plans later only if they ever have to.
The public is getting upset that none of the parties they usually vote for are telling them exactly what they want to hear, and many see this as a failing of politics. So they’re taking their vote elsewhere because they still want their short term satisfaction and a delay of pain and UKIP are the only party offering such attractive politics at this moment in time.
UKIP often refer to politics having failed. There has indeed been a failure of politics but it is in the attraction for parties to rely on patronising voters and telling them what they want to hear rather than what needs to be done. We’ve all become too used to this, and with the problems we are facing we need to change quickly.