A 45% income tax on earnings above £150,000 is a tax on productivity during a DEFLATIONARY cycle: UK scraps tax cut for the PRODUCTIVE, Britains Welfare State will continue until Austerity is FORCED – September 3, 2022,
One of the root causes of BIG GOVERNMENT begins and ends with INCOME taxes, which are a tax on LABOR; if you don’t believe social engineering DOES NOT work, look no further than the INCOME TAX. Humans have been CONDITIONED to imagine that TAXING 9-5 labour is a good thing. I read three different articles on the newly-appointed British Prime Minister Liz Truss reducing the current 45% additional rate with a single higher rate of 40% and only the Bloomberg article I point to below, written about a week ago, put the story in it’s proper context.
The two American news organizations I point to in this post made sure the article was framed in a way that made the audience imagine that these “fat cats.” in Londons White Collar class would be making tons of money with 5% savings. I remind you that 20+ million people living in the U.K are 100% reliant on WELFARE of some kind. For the record, the U.K has about 68+ million people.
The entire country of Canada has 38 million people, just to give the context of how many people living in the U.K who are UNPRODUCTIVE members of society. Now, if you were to read any of the two articles I point to below, they frame their articles in the context of the stock market sold off when it learned that the “rich” were getting a tax cut, which is far from the truth.
The market sold off when the Bank of England(BoE) decided NOT to fight inflation. Why did the BoE abandon its inflation fight? Well, the evidence appears to revolve around the same reason Barack Obama, and the Federal Reserve BAILED out Wall Street in 2007-2008 (Emergency Economic Stabilization Act of 2008), which was the PENSION crisis.
SOCIAL SECURITY was doomed from the start; I argue the main reason the world has to be a fiat monetary system is that Social Security is a SCAM. The main reason why politicians worry about the Stock Market is that governments in most developed nations abandoned defined benefit pension plans a long time ago.
What is a defined benefit pension plan?
A defined benefit pension plan is a traditional pension. It is one that provides a specific and predictable benefit (or amount of income) at retirement.
With a defined benefit retirement plan, the employer takes on the investment risk and responsibility for ensuring that there is enough money in the investments to fund the pension payouts.
While defined benefit pension plans were once fairly common nowadays, they are usually only found within the public sector.
Employees prefer defined benefit plans, and it’s no wonder with the many advantages they provide with minimal risk to the worker.(source: Defined benefit vs. defined contribution: What is the best pension? | fidelity.ca
Although Social Security and Pensions are two separate types of WELFARE, both are derived from the idea of social security, which pays people REGARDLESS of how productive they were during their working days. The defined benefit pension plan got the BOOT from the private sector because it was unsustainable, especially when labor unions began making the lives of their bosses a living hell.
Auto manufacturing basically abandoned the U.K, because of their labor laws, which made manufacturing in the U.K unproductive obviously jeopardized defined benefit retirement plans. Because if the current labor wants more money and benefits, whether or not the company they’re working for is profitable enough to pay these benefits, the company would obviously have to find a way to get rid of FUTURE payment obligations or at the very least make sure the workforce takes on some of the financial risks, which is something WAGE earners are not used to doing.
The defined contribution pension plan was created to make the wage earner an INVESTOR, instead of whining, complaining consumers of pensions. Now, this actually passed the responsibility of “social security” back over to the GOVERNMENT, which is where it belongs because, as I point out Social Security/Welfare State is a SCAM!
Without fiat money, none of the welfare systems we take for granted today would exist; the Bank of England is basically going to counterfeit money to prevent pensions from going bankrupt, which is the actual reason, the markets threw a hissy fit. Tax cuts for the so-called wealthy or rich should have been called tax cuts for the PRODUCTIVE, but one of the reasons I assume British Finance Minister Kwasi Kwarteng is aborting the INCOME TAX price cut is becasue a lot of wealthy people don’t work for income taxes anyway.
Analysis: Under water- how the Bank of England threw markets a lifeline | reuters.com
Wild gyrations in financial markets in response to a government “mini-budget” on Sept. 23 meant that swathes of Britain’s pension system were at risk, raising widespread concerns about the country’s financial stability.
British Finance Minister Kwasi Kwarteng’s statement had included dramatic plans to slash taxes and pay for it with borrowing which sent government bond yields soaring.
If you’re WEALTHY, you’re likely living off of the cash flowing coming from your assets, meaning you may actually be in a lot of DEBT, making it hard for the government to tax you in the first place. So if people who don’t understand the complexities of the tax code want to make a stink about lowering income taxes, I guess banding the idea is good POLITICALLY.
There’s a problem with the INABILITY to lower taxes, however, and that problem stems from the inability to cut regulations. If British Prime Minister Liz Truss is unable to SLASH regulations on the economy, which may also include SLASHING some jobs, consumer price inflation will continue to wreck HAVOC on the U.K economy. Now allow me to point out that the U.K is not alone on this; the U.K isn’t the only country with ridiculous regulations on PRODUCTIVITY, this is a problem in all the developed nations.
What makes the U.K different is that they’re the first ones to BLINK in the face of a rising interest rate environment. When I read about British Prime Minister Liz Truss I’m not seeing much of anything about Austerity Measures; she doesn’t appear to want to make TOUGH decisions, like abandoning these insane Climate Change objectives.
In order to fight consumer price inflation, leaders in the developed world or going to have to call Man Made Climate Change a HOAX; the climate change scam will have to be EXPOSED, and everything that comes along with exposing this climate change FRAUD will have to be DEBATED publically. Now, this won’t be easy because the PUBLIC sectors in most developed nations are high off the hog, and imagine that their DEFINED WAGESand Pensions are GUARANTEED into perpetuity.
But as we all know, if the private sector is UNPROFITABLE, the public sector is DOOMED to fail. Unless, ofcourse, we return to a state in which WAR is how countries enrich themselves. People tend to forget that Capitalism is the only system that PREVENTS war. All the wealth you take for granted is not the result of the PUBLIC SECTOR; our standard of living is the result of CAPITALISM.
Now, under a free market capitalist system, the UNPRODUCTIVE are NOT rewarded with welfare for doing NOTHING. Obviously, this doesn’t sit well with people who want the government or some other entity to pay them a defined income for LIFE, and this results in governments performing these balancing acts because after all DEMOCRACY is indeed a form of MOB RULE.
So if the MOB wants welfare, whether or not the State can deliver, the State has to always pretend that it can or WILL deliver on some form of welfare for life for voters. Where I’m going with this is that I believe AUSTERITY measures are ina=evitable at this point, and if you’re a SMART politician who sees the writing on the wall, you’d tell your voters that these climate change initiatives as presently constructed are UNSUSTAINABLE if you want Pensions, Social Security or a welfare State.
The numbers appear to show that the people KNOW man-made climate change is a SCAM, and all that’s needed to end this scam is for a politician to combat this man-made climate change fraud HEAD-ON. Now, dealing with all of these silly climate change regulations won’t stop consumer price inflation IMMEDIATELY, but it will change the trajectory of the MARKETS, which will no longer price in the carbon pricing schemes into their formulas.
I must point out that most of these climate change initiatives have resulted in many malinvestments. All of these malinvestments need to be FLUSHED out of the system, which WILL create an economic downturn. HOWEVER, a market economy flourishes when the COST OF DOING BUSINESS comes down. These man-made climate change alarmists are RAISING the cost of doing business, and when politicians do this, the private sector changes behavior because in order to be profitable and pay these pensions, the Private sector has to SHRINK its operating costs while passing the higher costs to its consumers.
A reminder that if the consumers don’t like the higher costs, the consumers will buy fewer goods and services, which then results in FEWER sales taxes being collected, which results in government expenses NOT being paid, which leads to the government having to BORROW more money to pay PUBLIC SECTOR debts and expenses.
This is why I see AUSTERITY MEASURES as an inevitability unless, of course, we’re headed for global COLLAPSE and permanent DEPRESSION, which also could happen, because Left-wingers and believers in Big Government are not only DUMB, they’re also STUBBORN. I love to talk about Argentina because no matter how many times Argentina DESTROYS its currency, VOTERS in Argentina REFUSE to shrink the size of their government.
In most countries, they consider Conservaitvsm a RACIST idea; in many Latin American countries, in regards to their political democracy, it’s usually the Far Left politician vs. the center-left politician. This is why most Latin American countries have so many problems with corruption and POVERTY. In English-speaking nations, Conservatives still have a voice, but most Conservative politicians are scared to use it.
The TRUTH hurts, and the truth is that people can REJECT your truth and expect the Left Wing lie that BIG GOVERNMENT solves all problems. In closing, until I see Liz Truss actually addressing CONSUMER PRICE INFLATION, all signs are pointing DOWN for the U.K economy. This could be RAPID because the U.K no longer has the worlds reserve currency, meaning that producers might put a PREMIUM on selling to the U.K REGARDLESS of how the Pound is trading on the Forex markets.
Interesting times ahead