Magic Money Trees
5th June 2017
Theresa’s now infamous quote to a working nurse that there’s “No Magic Money Tree” to pay NHS staff a decent wage falls into stark relief as we hear stories of heroism from our front-line services treating victims of terrible attacks in Manchester and London.
But how do you cut throughout the rhetoric and counter-rhetoric to find some clarity on a contested area?
A story by Tim Fernholz on Quartz highlights the work of Economists Annette Alstadsæter, Niels Johannesen, and Gabriel Zucman (1) which does just that:
“A spate of massive leaks showing the inner-workings of global tax evasion has given the public a window into how the super-wealthy—including celebrities, politicians, and criminals—leverage the globalization of finance to hide their wealth from the authorities. But the leaks, which encompass just one Panamanian law firm, Mossak Fonseca, and one Swiss bank, HSBC Switzerland, offer only a small peek at these illicit flows. Can we use this data to make a general observation about the prevalence of tax avoidance?”
Alstadsæter, Johannesen, and Zucman have taken the data from the two leaks and combined them with “unusually detailed income and wealth records in Norway, Sweden, and Denmark to estimate the size and scope of tax evasion. Adding these additional sources to the mix has allowed the researchers to make up for the consistent problems of random national audits.”
“The economists’ surprising finding: The top .01% of the wealthy in these countries (those with more than $40 million in net wealth) evades about 30% of their respective personal income and taxes, compared to the average evasion rate of 3%. These findings complicate two arguments commonly made by defenders of the status quo: One, that tax evasion is a relatively uncommon practice among the very wealthy highlighted by extreme cases, and two, that tax evasion among lower-income earners—working under the table or failing to declare tips, for example—is more pernicious than the use of offshore banks. This also has implications for attempts to measure inequality, which often rely on tax data that under-measure inequality because hidden funds are not taken into account. Zucman has argued in previous work that as much as 10% of the world’s wealth is held in tax havens and reinvested elsewhere.”
10% of the world’s wealth hidden.
But this is very specific to this campaign and to this group of Conservatives, whose senior figures are personally implicated and profit from this.
Our Home Secretary, Amber Rudd, as Paul Mason pointed out has her own offshore arrangements:
— Daniel France, (@daniboy104) June 3, 2017
Of course this hidden wealth is essentially theft, and it’s worth repeating that the entire narrative generated and maintained by the media is almost exclusively focused on a very different threat, that of the scroungers and the feckless poor.
This is all laid out very clearly.
We’ve known since 20111 that at least 50% of Tory funds come from City and we know to that the Conservative plans for the NHS centre around Jeremy Hunt’s Naylor Report which sees our health welfare as a “source of untapped value”.
So there’s a neat symmetry in which the nurse is patronised but her own hard work is exploited for more wealth to the already super-rich.
As health campaigner Deborah Harrington puts it: “We own this, it’s ours. It’s been handed down through the generations since 1948. We all contribute to this society that provides these things, and we’re being told now they’re unaffordable unless we cannibalise them, constantly reducing our property and ownership.”
But this isn’t enough.
As @doughadams outlines in ‘Workers vs. Shirkers – A Critical Review of Public Literature Concerning Unemployment, Austerity and Welfare’ (2):
“The government’s ‘austerity measures’ have led to a rise in the use of punitive and conditional measures against welfare claimants and have correlated with a change in public attitudes. The number of people supporting the statement ‘The government should spend more on welfare benefits for the poor, even if it means higher taxes,’ has halved since 1987 (IPSOS Mori cited in Tinsley, 2013 p. 46) and the sanctions on benefits claimants by the Department of Work and Pensions now outweigh the number of fines given by courts (Webster, 2015). A Foucauldian critique attempts ‘to make harder those acts which are now too easy’ (Foucault, 2003 p 172 in Fryer and Stambe, 2014a).”
This whole story about ‘Skivers vs. Strivers’ is key to the massive misdirection we’re being sold:
“Daguerre and Etherington (2014) highlight the ways in which the Conservative government in the 1980s led a change in public discourse, reframing the unemployed as either ‘lacking energy’ or ‘plainly dishonest’, with ‘renewed emphasis on welfare dependency and benefit fraud’ (p. 18). They strengthened the division between the ‘hard working majority’ and ‘work-shy’, and stigmatised benefit claimants, gaining support for punitive measures and welfare cuts (p. 17). More recently, the government presented benefits claimants as ‘… people who are either not trying, or who are gaming the system…’ and suggested a ‘battle to stop claimants slipping back into the benefits system by the back door’ (Chris Grayling, 2012).”
“Benefits cheats admit they get ‘TOO MUCH’ dole: New documentary lifts lid on scroungers.”
The Daily Star, 22nd October 2015
That we live in a wealthy country disfigured by poverty and inequality and where the media plays a vital role in exerting a propaganda to support that elite rule is becoming more abundantly clear every day. This week we can do something about it.