27/05/2022 11:58
The Guardian
Latest updates: chancellor urges wealthy recipients of rebate to donate money to charity as he details £15bn support packageBoris Johnson says UK ‘not necessarily’ heading for recessionPartygate anger but now move on: view from the other Downing StreetSunak U-turns on ‘energy profits levy’ in £15bn cost of living packageBoris Johnson has recorded a pooled clip for broadcasters which has just been shown on Sky News. In it he described the measures announced by Rishi Sunak yesterday as a “big bazooka”, but he conceded that it would not “fix everything for everybody”. He said:I’m not going to pretend that this is going to fix everything for everybody immediately. There are still going to be pressures. But it’s a very, very substantial commitment by the government to getting us through what will be, I’m afraid, still a bumpy time with the increase in energy prices around the world. The party has no future as a “moderate” proponent of the social democracy and socialism also promoted by the other parties. The Tories will never be able to win a contest with the Left on who can spend the most. The billions Mr Sunak showered on households today were predictably dismissed as insufficient by his opponents. It seems likely that pressure will build on the Chancellor to come back with even more support later in the year. Worse, every time the Government surrenders to the Left in this way, it does so at the expense of Tory voters. Chasing popularity is a foolish endeavour, if the result is to legitimise the arguments of your political rivals while damaging your own core supporters.The suspicion must be that the only real purpose to the Chancellor’s announcements was to distract attention from the partygate saga. If so, it was bought at a high price. Taxpayers and investors in energy firms will bear the immediate cost. But in the longer term, it may well be the Conservative Party that turns out to be the biggest loser.It is the sort of colossal redistributive programme more associated with socialism than conservatism, and there are very real fears it will push inflation even higher.The Daily Mail would not normally support such massive giveaways and we have serious concerns about this one.After years banging on about the moral case for low taxation – the quaint idea that societies are fairer and stronger when people are allowed to keep more of the money they earn – the Tories have now given up. Handouts are preferred to general tax cuts, allowing the state to choose winners and losers. Ed Miliband’s old idea about good and bad companies (the “predators”) is now back. Taxation is spoken of in moral terms: a tool to serve justice to stubborn companies making “excess” profits ...The big problem is growth, not inflation. The price spike is hideous, but it will be temporary. When it dissipates, a bigger issue will remain: an economy that is barely moving, and the UK could tip into recession at any time.In neglecting to come up with any relief for businesses, the Chancellor once again found himself in the bizarre position of being out-Toried by … the Labour party.It was left to Ms Reeves, of all people, to point out that a better solution might have been to “spike the NI hike” and cut VAT for businesses. Conservatives were similarly at pains to point out that adding to the highest tax burden since the Second World War instead of tackling the green levies that push energy bills up in the first place was hardly Lawsonian (the Chancellor has a portrait of his tax-cutting predecessor above his desk).The highest burden in 70 years is suffocating the economy.That IS un-Conservative. Continue reading...
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