Sunday 8 January 2012

Bidding War

It seems like both the main political parties have found some common ground. Both Ed Miliband and David Cameron are trying to get across that they are tough on executive pay. Some people on the Left are complaining that the two main parties are getting too similar and there is little difference in policy.

The public share these concerns; when discussing politics either on the doorstep or in the pub, the perception is that all politicians are the same. It is true that politicians are becoming a 'political class' with many MPs on both sides of the house taking a route similar to this;
 PPE Degree   Intern   Researcher  Campaigner  →  Parliamentary Candidate. 
The old system of working class heroes like Kier Hardie and Nye Bevan vs public school toffs like The Viscount St Aldwyn and Harold MacMillan no longer applies. While there are still plenty of men from privileged backgrounds on both sides of the house, the class divide between the parties is less pronounced. 

I am uncomfortable with the parties competing to be the toughest on the poor. Labour must emphasise the fact that benefit fraud fell by at least 24% under the last Labour government.There is a distinction that must be made between welcoming new measures to reduce fraudulent claims but we must condemn attacks on the sick, disabled and people who have been made unemployed as a consequence of the government's failure to mitigate against the effect of the global economic downturn which was caused by the banking crisis. The government continues to allow companies to evade tax, preferring to implement policies that force the most vulnerable into poverty rather than compelling large corporations to pay tax owed to the treasury.

There is a similar message coming from both Labour and the Tories on executive pay. This is a Good Thing. I hope they get into a bidding war:

Ed: "We will cut executive pay"
Dave: "We will cut it more"
Ed: "No, we will cut it even more AND tax it properly AND use the revenue for job creation"
Dave: "No, we love cuts so much that we are going to make all executives work for the minimum wage.
Ed: "OK"

It's not going to happen. The government could however implement the recommendations of the high pay commission which include having a more diverse group of people on remuneration committees, and a simple transparent system of awarding executive pay. That would be a start.


1 comment:

Brett Manning said...

We don't even need a high pay commission. Give shareholders a proper say, set up two tier boards with worker representation and have increasing marginal tax rates at the top end and you could achieve very similar results.

Tax evasion costs between 10x and 500x times more than benefit fraud (depending on how you calculate either).

The crazy thing about Labours' three terms is that inequality grew much faster than at any time previously. And we did a great job in making the poor richer (I know more to be done but it's more about education than extra cash). So how did inequality rise? We ignored the top end.

It's about time progressive really meant progressive.