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Mr. Stross looks at the most likely effects this would have. Basically, Britain would see its foreign trade dry up and wouldn’t really gain any real independence, and considering that the UK is such a financialized economy at this point, getting cut out of free trade pacts don’t sound all that good. It does seem pretty clear that the UK’s deeply hated leaders are hoping to use Europe as a way of keeping attention off of the inability of their one-dimensional austerity strategy to prove results. The only question is whether or not it has enough juice to accomplish this, and I’m skeptical. It’s shrewd in its way, but it’s buttressing an essentially reactive economic strategy at this point, and that’s the biggest fundamental. It could wind up being Cameron’s “self-deportation” moment I suppose.
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Over in the UK, Labour is now up big over the ruling Tories. Part of that is almost certainly a stalled, ailing economy, but what’s sort of interesting because a big part of their drop is due to implementing a cap on charitable deductions, which is essentially what Obama wanted to do here to cut the deficit. It’s good policy, but really terrible politics. I have no idea if implementing such a cap would limit charitable deductions by wealthy people, I suspect it wouldn’t, but intuitively it seems as though it would, and it’s a short hop from this and austerity to getting the “heartless” tag. Or maybe it’s already done. Of course, none of this wouldn’t have been necessary had the Tories not made a huge cut in the highest tax bracket a few weeks back. I’m beginning to think that all those stories about how thoughtful and moderate the Tories are might be overblown, don’t you?
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Here’s what action on privatization will get you:
David Cameron has squandered the Conservatives’ new year lead as voters turn against his health reforms, according to a Guardian/ICM poll. The Tories are down by four percentage points in a single month, slipping from 40% to 36% since January. Labour is one point ahead, on 37%, with Ed Miliband’s party up from 35% last month. The Liberal Democrats slip back two to stand at 14%, and the combined total of the smaller parties has climbed by four points, to 13%. As the prime minister hosted a special NHS summit, which excluded the professional bodies most opposed to his health and social care bill, the public is siding with those royal medical colleges who want the legislation ditched. An outright majority of respondents, 52%, say that the bill – which would overhaul NHS management, increase competition and give family doctors more financial responsibility – should be dropped. That is against 33% who believe it is better to stick with the plans at this stage.
Which is to say, push more costs onto providers and introduce some kind of a Medicare Advantage-like program to complement, shall we say, the NHS (MA “competed” with Medicare at 150% the cost or so). But once again, the lesson is reaffirmed that steps toward privatization just aren’t going to be stomached by the voters of this or really any other electorate. As usual, the worst news here is for the Liberal Democrats. But this would be a golden opportunity to tear their misbegotten alliance asunder, if they wanted to. Whatever the logic behind it at first, it’s pretty clear that the new Tories are essentially the same as the old Tories, only with dumber leadership. Even Thatcher never messed with the NHS. Clegg must have decided to go all-in with this alliance, hoping things will get better before it’s too late, but as we Democrats have learned here in the US, passively waiting for the economy to get better isn’t where you want to be in politics.
This is very odd:
Prime Minister David Cameron put his name to a letter also signed by the leaders of Australia, Canada, Indonesia, Mexico and South Korea. [snip] The letter, not signed by the US or any eurozone state, urges swift action to resolve the debt crisis in the single currency area and for measures from Washington to put public finances on a sustainable path.
I get the Europe part, but why the concern about long-term American finances alongside the Eurozone? Ours is not an urgent problem at all, it’s medium-to-long term at best. It’s actually very annoying to hear the leader of a country that is heading for a double-dip recession much faster than we are lecturing us about economic policy, as though he has any sort of standing to tell us how to run things. The politics in this country are screwed up for sure, but not that screwed up. As they say in your country, sir, bugger off.
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I’ve been thinking about this argument by Kevin Drum about the estate tax all day:

I’m not sure what to think of this. It’s possible, of course, that the public has simply been brainwashed by over a decade of focused estate tax propaganda from representatives of the rich. It’s also possible that most people have no idea that the estate tax only hits the extremely wealthy in the first place. But I don’t think that’s the whole story. Like it or not, I think that most people simply have an instinctive feeling that you should be able to bequeath your money to whoever you want. If most bequests went to, say, political parties or yacht harbor upkeep groups, things might be different. But as long as most bequests go to family members, you’re dealing with a very deep, very primitive protective instinct that most people sympathize with no matter how rich you are. After all, I feel that, and I don’t even have kids.

I’ve always supported the estate tax*, because it makes sense from the perspective of finance and as a matter of social justice. I’ve always thought the Republicans’ edge on this was due to inept Democratic framing: dropping the estate tax for means we have to hike taxes elsewhere to pick up the slack, solely to help the wealthy. Taxing the dead means less of a burden on the living. Democrats almost never put it that way, though, because many of them don’t really support the estate tax themselves. But Kevin’s post has stuck with me because I think there’s a real element of truth there. Even in Socialist Old England, eliminating the estate tax has good public support. It is likely the reason David Cameron is the Prime Minister today, instead of having to wait until sometime in 2012. Some might excuse sentiment on this issue as the public thinking they’ll get rich some day to leave behind a huge inheritance to their children, which has some logic, but I think I agree more with Drum’s analysis.

The fundamental assumption of America is that there’s a chance–not a certainty, but a chance–that hard work will be able to be channeled into success. The estate tax is paradoxically both an affirmation and a refutation of that thesis, and an indication of how complicated our cultural identity still is. Polls generally show good support for hiking taxes on the rich (a quick search of my Reader finds this one, among others) to close the deficit, but not on this particular point. Perhaps it’s the altruistic overtone of the act of inheritance that makes the difference here. Something is being given to someone, rather than that person having to work to earn the money. It’s ironic that the public is much more comfortable taxing the money people earn than the money they get handed to them, especially since our culture idolizes work. But it seems to be the case. In fact, this interpretation could lead to the counterintuitive finding that the dearth of support for the estate tax isn’t the result of empathy for the rich but rather the opposite, since it’s easy enough for everyone to visualize getting a big inheritance check from a relative. That doesn’t require putting yourself into someone else’s shoes. Much harder to imagine earning over $250k a year I suspect. But, to be honest, that is supposition.

So that’s the way in which the estate tax opposition refutes “the culture of work.” On the other hand, inheritance can be seen as just a reward for a lifetime of hard work. Being able to pass on that wealth can be construed perhaps as an incentive to work hard as well. Thus, the argument that the tax is a double-tax of earned money, which is not always true if the money was inherited originally. That is a distinction that hasn’t been made and would be hard to form policy around, and it doesn’t seem too germane to the average person. Still, this constitutes the “straightforward” explanation for why untrammeled inheritance would be popular.

I don’t know what all this means, except that America is a young country that is still puzzling out these fundamental questions about work and money. I wouldn’t say that my opinion on the matter has fundamentally changed, but there are a lot of lefty bloggers and pundits who take a reductionist view of the estate tax debate. So do a lot of similar folks on the right. The public might side with them at this point, but the more I think about it, the more it seems like public opinion about the estate tax is a clash of distinct and contradictory values whose underpinnings have yet to be fully understood by either side.


*Of course, I haven’t always supported it. I’m pretty sure I didn’t care at all when I was an infant. That’s an irritating turn of phrase, no? And yet an ubiquitous one.

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