Early morning surprises can be lovely, but not when they involve Rachel Reeves. Probably the last thing anybody wants to see as they wipe the sand from their eyes is the Chancellor looming over them. The sudden, unexpected appearance of Reeves at cock crow this morning – ‘My office, first thing, sharp!’ – felt like a dawn raid, the age-old military tactic for attacking when the human body is at its weakest. Well, it didn’t work.
The recent wranglings over the exact definition of ‘working people’ wouldn’t fool a four-year-old
We learnt today that despite Reeves having ‘fixed the foundations’ last year (don’t laugh!), ‘the world’ keeps throwing ‘challenges’ her way. The bloody world, eh? Those terrible, unexpected challenges. This is odd, because while I’m not an economics expert, I could’ve told her on the day of her first Budget last October what the world, the ratbag, had up its sleeve.
As the Budget nears, like Jaws’s fin cutting through the water, Labour is scrabbling desperately; how do they increase tax while claiming they haven’t broken their manifesto pledge? ‘Labour will not increase taxes on working people, which is why we will not increase National Insurance, the basic, higher, or additional rates of Income Tax, or VAT,’ we were told, of course. However Labour spins it, the breaking of really big manifesto pledges like this one still counts for something, as Nick Clegg could tell you.
The recent wranglings over the exact definition of ‘working people’ wouldn’t fool a four-year-old. We’ve had several definitions, including Starmer’s oddly vague and antiquated ‘people who can’t write a cheque to get them out of difficulty’, and Downing Street saying working people ‘know who they are’. What does this film-flam boil down to? Principles, apparently – and, in particular, the time-worn Labour principle that those who have taken the time and made the effort to be prudent and solvent must be clobbered to help out those who haven’t. This is fairness, apparently. We must ‘all do our bit’, we’re told, if the state is to continue to provide the fantastic, value-for-money public services we enjoy.
The definition of a working person has now been tipped upside down. We have heard from Whitehall sources that the Treasury has solved Labour’s paradox, by the simple device of defining ‘working people’ as those in the bottom two-thirds of earnings, or those on a salary below £45,000.
Based on this metric, a poet or an author – even a humble, horny-handed columnist – would likely count as a working person, but not a plumber or an electrician. Or indeed a Member of Parliament.
When pressed this morning on raising income tax, Reeves replied in her trademark ‘computer says no’ Apprentice-ese: ‘I will set out the specific policy choices on the 26 November, and that’s the right thing to do, and we’re going through that process.’
Reeves is reportedly weighing up imposing a 20 per cent charge on people trying to flee the country, taking the Hotel California approach to economic emigration: ‘You can check out any time you like, but you can never leave’.
Labour are now the party of high earners, so you’d expect them to behave like it. But they’re quite happy to impoverish their new voters. Why? Because they have an infantile inability to understand very basic economic facts: facts so basic that I can understand them, and I failed Maths O level three times. Why can’t they face them? Because it means admitting their world view is wrong. Not just wrong, but utterly, catastrophically bum about face.
The truth is that Labour is waging a proxy class war. But as I said last week, this is very much not the class war it seems to be. The actual divide is between the thin stratum of the progressive middle class and absolutely everybody else. Reeves and Keir Starmer think they must be right, because, in their view, they cannot possibly be wrong. It’s a bit like in the days before GPS, when the map reader on the family holiday would never admit they’d been dishing out the wrong directions: ‘Keep going, yes, this is definitely the road to Ilfracombe’ – and you found yourself in Lytham St Anne’s.
We’re told that one of the biggest problems is the electorate, who won’t suffer cuts. This seems odd, when you consider the Tories’ electoral success in 2015, after five years of ‘austerity’. It is surely not the electorate, but politicians whose understanding of economics is askew.
Labour aren’t the only ones with this problem. The Lib Dems and the Greens’ share this failure to understand that freely spending other peoples’ money will inevitably end in trouble. Yet still they bury their heads in the sand and cling on to their really quite weird mix of Christianity, 19th century socialism, and eschatological medieval superstition via environmentalism. That mix is then overlaid by our old chums: spite, resentment and contempt.
What makes such people understand hard economic facts? In my experience, only utter ruin. Nigel Farage’s prediction of a 2027 economic apocalypse feels much more likely than Reeves’s airy visions of jam tomorrow and treasure in heaven. The irony here is that Farage in office could, thanks to Labour, be faced with a market-forced programme of genuine austerity, which will make Reeves’s present problems seem positively quaint.
While we wait for that, we can look forward to the next Labour definition of ‘working people’: nobody. Which will be appropriate, because that’s exactly who is going to vote for them.
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