Markets and Regulation
Brexit is on the horizon. However two years of tedious debate has been exclusively focussed on the mechanics of leaving and whether it’s even worthwhile. None of us can remember a time since the campaign when anybody, seriously, talked about thing great things we can do with the powers we’ll get back.
We’ve taken the opportunity presented by the second anniversary of the referendum to outline what is possible now that we’re leaving and what ‘taking back control’ could mean.
1. Gradually phasing out VAT
Did you ever wonder what the government did to deserve the extra 20% they slap on the value of everything you buy? Or why they want to increase the price of the things you sell beyond the point where they are sellable?
Well the answer is that the EU made them.
As a regressive form of taxation it hits the poorest hardest because it’s based on spending rather than income. The amount a millionaire spends on a day-to-day item is the same as someone on minimum wage. The poorest 10% of households pay more than 20% of their gross incomes on duties and VAT – twice the average.
We can’t afford to scrap it straight away – more’s the pity – though we should immediately lower it to a point in the Laffer curve where both consumption and income rises, with a view to eradicating it completely as debt falls and the state becomes smaller.
2. Scrapping Air Passenger Duty on internal flights
HS2 stands to cut the average journey time from London to Glasgow by a whopping 30 minutes, to Liverpool by 32 minutes and Newcastle by 33 minutes. What economic benefit these cities are meant to derive from this is unclear.
Air Passenger Duty has been creeping up for years. Like VAT, it is strongly regressive. While scrapping the tax for internal flights won’t make flights quicker they will certainly make them cheaper and, eventually, more frequent. As compared to the HS2 method of making the UK smaller, it’s cost neutral for taxpayers.
3. Getting out of the European Arrest Warrant
You can’t remain judicially independent and stay in the European Arrest Warrant mechanism. The EAW sends Britons abroad to face political show trials in places where human rights are described as a ’theoretical luxury’. To take back control, we simply must leave.
4. Duty Free
We would ditch sin taxes in a minute however it’s very unlikely that any government of any hue will agree with us. For now. Despite the obvious opportunities to get around punitive levels of taxation presented by the return of duty free shopping, there is some economic value. The ferry industry suffered when duty free was scrapped. The UK Chamber of Shipping is already salivating at the prospect.
5. Weights and measures? Your choice mate
We can’t get too excited about pounds and ounces but if you want to use them, go for it.
Let’s get one thing straight up front: Conservatives for Liberty is pro-immigration.
We’re not pro any and all immigration with no management at all, and certainly not pro EU free movement of people, but do we generally think that immigration is a positive thing.
Some industries in the UK simply cannot survive without immigration: mostly specialist skilled areas we don’t produce many workers in like electrical engineering, skilled professions in high demand like doctors, and undesirable labour intensive work like fruit picking. Immigration helps us to supply the manpower needed in these industries, and also helps balance out the costs of our ageing population.
With employment levels consistently high, we are approaching a time where economic growth will be seriously held back by not having enough people to work.
It’s not just an economic argument. The team at Conservatives for Liberty recognises the cultural good that so often comes with immigration. The most obvious cultural value that’s brought to us through immigration is in food. But we also see it in music and the arts, and all kinds of other areas.
Brexit offers us an opportunity that we have not had for a very long time: the opportunity to design a new immigration system that can be applied equally to everyone, regardless of their nationality. This is one of the reasons Conservatives for Liberty was such an ardent supporter of Brexit in the referendum campaign.
So what does our ideal immigration system look like?
Do we want a free for all? No.
The first thing we want is proper border controls, not just as a counting function, but so that we know who is coming and going. We need to know that people are who they say they are, that they meet the criteria set out below, and that they are safe to have in this country.
Our principle for controlling immigration is simple: if you can support yourself, you can come here. In order to assess whether people can support themselves, we have three criteria and every economic migrant must meet at least one:
- Have a job to come to, not just an offer or a hope, but signed employment contracts.
- Be a skilled worker in a field the UK is seriously lacking (this list would look similar to the Tier 2 Shortage Occupation List).
- Be able to financially support themselves through other means, e.g. with private wealth.
In all cases immigrants would not have access to state benefits or the NHS, and would be required to buy private health insurance.
Under our system we would not have caps or targets for immigration – we think that they are a nonsense. Caps are a nonsense because government is incapable of accurately predicting how many migrants are actually needed. The best known example of this failure has been the recent rejection of migrant doctors, to which the government has responded by removing caps on doctors and nurses. But there are hundreds – perhaps thousands – of cases where UK businesses are badly affected by difficulties in getting the right staff, exacerbated by immigration caps; they’re just not as interesting to the media as the NHS.
There are three further planks to our ideal immigration policy.
First, people with criminal records are not allowed in, and people who commit crimes whilst in the UK are deported. We think that migrating to another country is a privilege, not a right, and that privilege should be lost with bad behaviour.
Second, families can come here too, but the definition of a family connection will be limited to spouses and children under the age of 18. For their family to join them, the person (or the married couple’s income taken together) meeting one of the three immigration criteria must be able to support them.
Third, in order to get the full benefits of being in the UK, including unemployment benefits, state pension, and access to the NHS, migrants must go through the process to become citizens. We envisage this continuing much as it is, with residency requirements, language tests, and the Life in the UK test.
You’ll notice that I haven’t talked about asylum and refugees in this article – and that’s deliberate because it’s an entirely different thing. It is broadly covered by international law, with humanitarian responsibilities. That’s not to say we wholeheartedly support current arrangements for refugees and asylum seekers – it’s a topic for another day.
But what about public opinion?
Time and again we’re told that the average man on the street is anti-immigration. That the reason the UK voted to the leave the EU is because we’re a nation of xenophobes. But I don’t think either of those things are true.
Yes, people are fed up with seeing immigrants who claim benefits (even though this is a minority of immigrants), they’re fed up of seeing immigrants commit crimes and then getting to stay here, and they’re fed up of the sense that the government hasn’t gripped this issue despite decades of outcry.
The solution to these gripes is not an unworkable, unachievable, economically damaging cap on immigration. It isn’t continuing free movement from the EU – with all that entails including entitlement to state benefits – whilst clamping down on immigration from non-EU countries in a way that looks, frankly, pretty racist.
If we keep track of who is here, deport anyone criminal, and make it impossible for immigrants to abuse benefits, I suspect people will be a whole lot less bothered about immigration – and they might even start to see the positives as we do.
My local Co-Op recently underwent one of those ghastly upgrades which turn slightly glorified corner shops into mini convenience meccas, where one can buy just about anything, so long as you’re prepared to pay a little bit more than you would at a place you have to drive to.
A whole new aisle was crammed in to accommodate the jars of olives, tortilla kits and bags of fancy popcorn that for some hitherto unexplained reason occupy more prominent positions than milk, bread, eggs and other things people actually want to buy.
The whole thing was launched with aplomb. A sponsored Facebook post appeared in my timeline announcing ‘Beersbridge’s new Co-Op’. Nobody calls it that. That tragic, since corrected, misfire, which probably originated inside Co-Op’s vast Manchester headquarters set the theme, for in the process of the revamp two of the most obnoxious and patronising self-service check outs imaginable were installed.
Now this has its advantages – for me – in that nobody else ever seems to want to use them. They only take card payments and are unable to dispense either tobacco or scratchcards. While the queue to check out at the only staffed checkout is often five people long, I can usually jump the queue and head straight for Little Miss Condescending, thereby drastically reduce the time I spend standing in the far-too-narrow aisle up against the one kilo bars of Dairy Milk, waiting for people to get “a Lucky Dip for tonight”.
It was during an encounter with this highly mechanised unpleasantness that I first got wind of the apparent seriousness of energy drinks.
I was on the way to the gym and had stopped for some supplies. Chewing gum, beep beep, more chewing gum, beep beep, Monster, flashing red lights and ‘Challenge 25 – the assistant need to confirm your age’ (syntax errors are an increasingly common theme of my local Co-Op) flashing on the screen.
I panicked, and not only because – like everyone else who has ever shopped in there, including police officers – I was parked on the double yellow lines outside and needed to be on my way. Instead of picking up a relatively harmless drink that would increase my focus in the gym, had I mistakenly attempted to purchase industrial effluent, some solvent, or perhaps a rather large machete?
After waiting around for two or three minutes for the one guy on the till to notice that his eventual replacement had ceased to earn its keep my age was finally verified and I was able to chug my (modest) 150mg of caffeine without any further encumbrance.
There is currently no age at which you cannot legally buy an energy drink, but that hasn’t stopped retailers enforcing their own bans and asking for ID. Most energy drink producers will state that the product isn’t meant for children despite the fact that caffeine overdoses are generally harmless. Unless you think fidgeting, anxiety and insomnia are life changing experiences, that is.
Some deaths are occasionally linked to caffeine though. However, these deaths don’t occur because of caffeine overdoses, as a lethal dose of caffeine is virtually impossible to achieve for the average person whose caffeine consumption is liquid based. Most people will die with 10g of caffeine in them. That’s 66 cans of Monster or 133 Tall Vanilla Lattes from Starbucks. And you better have the capacity to drink all of that, all at once, before it passes out of your body.
Rather, rare caffeine-related deaths are the result of bodies that haven’t yet grown accustomed to caffeine yet and underlying, or undiagnosed, heart conditions. Indeed, the coroner in one recent case was at pains to point out that the death of a teenager who drank a latte, a Mountain Dew and an energy drink was not related to caffeine overdose. Indeed, looking at a list of deaths where caffeine is known to be a factor, deaths tend to be either freak accidents or intentional.
The fact that deaths where caffeine has been a factor seem to occur mostly among the young leaves an increasing number of people ‘thinking of the children’.
The NASUWT welcomed Waitrose’s under-16s energy drink ban with a wish that it would “also encourage the Government to produce national guidelines on recommended consumption levels of caffeine for children”. They went on to say that “These drinks are readily available legal highs.”
They have previously called for a blanket ban on caffeinated products to under-16s, and so too has a Welsh Labour AM.
It seems that these people just can’t help themselves. While I’m sure some of them are motivated by what they consider to be an epidemic of deaths attributable to excess caffeine there is, as usual, a degree of snobbery about it all. This is perhaps best demonstrated by the involvement of nanny-in-chief Jamie Oliver, whose views government seem to lend credence to for no discernible reason. Jamie will serve you with virtually any caffeinated (and sugar-laden) product in one of his restaurants. Yet he hypothesises that energy drinks affect the concentration levels of kids in class, which impacts upon the grades of other children, thereby crossing his tolerance threshold.
The public health lobby have never been known for logic or consistency but Conservative MP Maria Caulfield’s argument for a ban is even more bizarre than Oliver’s. The suicide of a 25-year-old man who also drank heavily and whose parents say energy drinks made him anxious has been advanced as a reason to ban energy drinks for under-16s. The response from Jackie Doyle-Price was even stranger. The Minister said: “we do know that all stimulants whether its alcohol or caffeine do actually have consequences which can affect peoples’ mental health”.
The public health industry’s stated aim is of preventing under-16s getting their hands on a substance that is generally harmless and available in greater quantities in their local Costa. But what Doyle-Price’s response suggests is that there is a willingness in government to equate caffeine with things the public already acknowledge as harmful, like alcohol. That alone should serve to act as a red flag to anyone who enjoys a simple cup of coffee.
In a few short days the injustice and absurdity of London’s Uber ban has been decried and derided by thousands of us who see it for exactly what it is – socialist protection of a unionised vested interest. There is no more to be said, the cronyism on show is unabashed. The only thing to do now is contemplate the massive open goal that Sadiq Khan has presented us with.
Since the election I’ve read any number of articles lamenting the inability of the Conservative Party to sell free markets to the electorate; and here is a guilt edged opportunity to do just that.
Uber’s success was clear evidence that real capitalism works for the benefit of us all and not some imaginary caricature of a ‘businessman’ in red braces. Uber’s absence will make millions of Londoners’ lives more difficult and that fact alone is proof positive to anyone that competition and free markets are better than the alternative. We should be singing it from the rooftops.
Arguing against socialism should be easy. A death toll of over 90 million should put any debate to bed but in the minds of the young it is difficult to make a connection between the nice bearded chap in the brown suit and state-sponsored rape, torture and murder (even when he fails to openly condemn it). But having your cab fare doubled overnight sends a strong message about what socialism really is and most importantly what a regressive force it is.
In the face of such an unpopular decision the question is, can we turn the Uber ban into the ‘Gateway Drug’ to Libertarianism?
Anger on this issue is only a stone’s throw away from suspicion of the nanny state, skepticism towards the welfare state and resentment of excessive taxation. The Uber ban could expose millions of free market virgins to the wondrous ‘All-You-Can-Eat Buffet’ of ways in which more freedom and less government improves everyone’s lives.
This could be the start of a real dialogue with the British people about the indisputable benefits of market economics. A debate the Conservatives will always win, a debate in which the opposition has nothing more than empty slogans and wasted saliva.
For too long ‘Capitalism’ has been a dirty word, it is time the British people confronted the truth that it is the bedrock upon which all that is great about this country is built. And even Conservatives of a more burgundy hue must not be ashamed to say this.
Renewing Uber’s licence must be the first pledge of any Conservative candidate for London Mayor and the party should make this clear immediately.
Sadiq Khan looks increasingly like a future leader of the Party and he will do so on a ‘moderate’ ticket. In this event it is our job to remind the country that after this he is nothing of the sort and his lukewarm brand of Leftism is just as insidious as anything being sold by Corbyn or his comrades in Caracas.
Another day and another regulator has stepped in to stop the clock.
That may seem an extreme statement to make about TfL’s decision not to renew Uber’s private hire operator’s licence from next Saturday but that is what the net effect will be.
Uber operates in over 700 cities across the world but London has sensationally just announced that it will render 40,000 drivers without work and 3.5 million users without any meaningful choice. While Uber will still be able to operate until the appeal process is exhausted the writing appears to be on the wall – back to your overpriced cattle pens and sweary sweat boxes, Londoners
The reasons advanced for the decision are essentially based around incident reporting, how Uber obtains documents and software that prevents the regulator accessing the Uber app.
It’s hard to believe that TfL have reached this decision all by themselves – you don’t have to look very far on Twitter to find evidence of intensive lobbying by Uber’s rivals in the capital. Indeed, when Uber prepared to launch in Belfast, the local taxi duopoly were barely out of the department responsible for regulating transport. The madness has even reached Australia where cab drivers successfully managed to lobby for subsidies to make up for their reduction in earnings.
Screeching from traditional industries aside, after years of trying to ensure that London’s roads were reserved for (the quite brilliant) Routemasters, freight vehicles and cabs, policy makers have become rapidly frustrated by the number of actual cars on the road.
A largely automated booking service and an entirely paperless system of receipting, billing and travelling has created a cheaper, better product than the Essex-based cab driver whose ability to be flagged down, excellent patter, daily commute, union fees and basically pointless ‘knowledge’ you pay a premium for. Uber grew rapidly from 2014 onwards and so short tube and cab journeys decreased.
While TfL’s brief press release didn’t go into detail, what is telling is that TfL do not like how Uber meets its regulatory obligations. It’s a process issue. At no stage do they seem to be claiming that Uber does not conform at all.
In that case, it’s reasonable to speculate about the relevance of a regulatory regime that at best is outdated and at worst has been built around the norms, of an industry that, without consistent regulatory intervention, would be dead.