Income for Me/Wealth for We: A Path to Economic Justice
So the government now has a Brexit plan having had an awayday at Chequers, and Jeremy Corbyn has made a speech that gives some direction to Labours view.
I don’t think so
No one seems to know where we are going on Brexit. I say stop it now and fix the fundamental problems of extreme inequality, financial hardship and falling living standards. If they had been addressed earlier we would not be in this Brexit mess, sauntering towards a cliff edge.
The political rhetoric around extreme inequality has typically little to say about concrete proposals as to how inequality reduction can be achieved and how to help us all progress to prosperity. But some of the toughest challenges confronting human civilization lend themselves to practical solutions hidden in plain sight. These solutions don’t require us to strike tough compromises or to unravel complex priorities. These policy ideas simply require us to think clearly and act decisively.
I propose an Agenda for Progressive Prosperity, which aims to minimise extreme inequality and create greater opportunity for all by bringing significant financial relief to the poor and squeezed middle. It is based on an inequality-busting strategy of “Income for Me/ Wealth for We”. We keep the income we earn from our work and we share the wealth we all create more equitably. The tax system would be reformed to shift the base from income to wealth and to encourage greater social responsibility.
This could be achieved would be by abolishing income and payroll taxes for the majority of the population. About 80% of income tax payers earn under £32,000 yet the income tax they pay contributes just 8% of government revenue (Source: ONS). Abolishing income tax for lower earners could give up to 15% pay rise for 25 million people and could inject £55 billion into the economy, increasing demand, encouraging growth and boosting jobs.
There is a very strong business case for the wealthy to invest more in the nation rather than their personal agenda. A well educated, healthy people with an efficient and modern infrastructure is a very strong basis for a wealthy nation with opportunity for all, not just the few. The National Institute for Economic and Social Research has assessed that a tax of 1.2 percent on net assets over £700,000 per year would generate £43bn annually for the Exchequer. That percentage could be higher and could be increased for the super wealthy, making it feasible to generate £100billion a year, or rather for the wealthy to invest that figure in their nation for the common good not private gain.
By generating government revenue from wealth instead of income, we could take a major step toward minimising economic inequality. The problem, of course, is that our political leaders are not bold enough to say that those with substantial accumulated wealth should contribute more and how it could be achieved.
So an effective assault on poverty will only deliver when our government has a clear strategy and is truly committed to a practical plan of action, not just a sound bite. It seems the established parties are unwilling to present new radical ideas, which actually get to the root of the problem and would benefit the vast majority of the electorate, The political extremes we are offered have failed to deliver. If it had been addressed, we would probably not be diverted by the Brexit debacle. It is time for radical action, not politically weak platitudes.