Bel is thinking

It’s Sunday, so it can only mean one thing: politicians are attacking City bonuses. They certainly seems to make a habit of it on Sundays (see here and here).

This time, it is our old friend, Peter Hain. He has returned to his favourite theme. Now he wants City workers to pay two thirds of their bonuses to deprived communities.

Exactly what is it about private enterprise that Peter Hain does not get? Is it the bit about what companies pay their staff being no business of the Government? Or does he not get that these bonuses have already been subject to high taxes, which in turn were supposed, under Labour, to have already been ‘redistributed’ to these deprived communities he so champions? Or perhaps he does not understand that people are generally paid what the market feels that they are worth?

What is it that Mr Hain cannot understand? I would have thought that these were truths apparent to a secondary school economics student, even in these dumbed-down times. I know the Left traditionally has a history of woeful ignorance in matters of the market, but at this stage of his political career, there is frankly no excuse for Peter Hain.

Peter Hain, and by extension, this Government, must learn that not everything is to be determined by political decisions, or legislative action. Some matters transcend even the so-called ‘good intentions’ of a Labour government.

By making this suggestion, Mr Hain is admitting that his Government has failed in its avowed pledge to tackle poverty. In 2005-06 (see pdf), this Government collected £405 billion in tax. It paid out a net sum of £17.3 billion in tax credits in that same year. Going by previous years, the taxman estimates an overpayment of tax credits of almost £1.8 billion.

So having collected, and ‘redistributed’, the above sums, there are still deprived communities in the UK, to which Mr Hain wants City workers to contribute? Unbelievable.

Under this Government, we have seen taxation rise to the highest levels for a long time, with nothing to show for it. If Peter Hain wants to act concerned about the plight of deprived communities, perhaps he could start by questioning his own Government about their failures in this regard. He could ask them precisely how it came to be that despite record tax levels, and despite their claims to care about the underprivileged, we are in the situation that we are.

Then after doing that, he could take a few weeks off work and enrol in a community college in Neath for a crash course in economics.