I just have to take on some of Jeremy Corbyn’s fantasy economics. I mean he has this money tree wishlist in his manifesto – Amber Rudd
Does Jeremy Corbyn actually have a ‘magic money tree’? Amber Rudd seemed so convinced he does, she mentioned it multiple times in the opening 30 minutes of the recent leaders debate. Perhaps a crack team of Conservatives spied on Jeremy at his north London allotment and saw the wondrous plant with their own eyes? It is probably hidden in the back corner of his garden, dwarfed by monumental vegetable shrines to Hamas and the IRA.
It seems pretty strange, though, that a man who has dedicated his entire political career to social justice and increasing funding for public services would not spread the benefits of his magical horticulture, if he could. Theresa May and her team seem to have developed a habit of backtracking on disingenuous statements. Therefore, the only way to know the truth is to study Labour’s four main spending commitments and see once and for all whether they are possible without a mystical plant.
Raising Corporation Tax
Imagine a Britain filled with economic chaos and major corporations fleeing for pastures new. People don’t have jobs and there are hundreds of thousands of empty shopfronts where Starbucks used to be. All this because Labour followed through with a pledge to raise Corporation Tax from 19% to 26%, with the aim of generating £19.4bn per year by 2020. Look closer, and the corporation tax dystopia theory falls apart. The tax change described above is not a world away from the economic climate in many countries around the world. Even with Corbyn’s hike Britain will still remain the country with lowest corporation tax in the G7. Also, the 26% figure will still be lower than under the reign of extremely uncommitted socialist Margaret Thatcher. Corporations who think of fleeing will find similar or higher rates in major developed economies. Corbyn is just asking business to pay their fair share and bringing us up to speed with the rest of the world in the process.
My verdict: No tree necessary.
The Labour party ‘will commit to over £30 billion in extra funding over the next Parliament.’ This will be through increasing income tax for the highest 5 per cent of earners and by increasing tax on private medical insurance. This will be achieved through lowering the 45p tax rate to salaries of £80,000 and reinstating the 50p tax rate on salaries above £123,000, standing in stark contrast to the Tory’s refusal to increase taxes on higher earners whatsoever. This rise in top 5% taxes is projected to raise £6.4bn per year, leading to a windfall of £32bn across the entire parliament.
My verdict: No tree necessary.
In a political masterstroke, Labour declared that they were scrapping University tuition fees the day before the final voter registration date. This has prompted over 90,000 young people to register to vote in the hope of a life unsaddled by astronomical debts. The £7.5bn cost of this measure will be covered by the increase in corporation tax. While it seems like a radical decision to go from the eye watering £9,000 per year to nothing, zero or minimal tuition fees are actually not uncommon. Austria, Germany, Denmark, Finland and Sweden all provide free university education to EU citizens, with countries such as The Netherlands and France only charging a fraction of the UK. Additionally, in this age of perennial recessions, household debt is often the nail in the coffin of consumer spending so any measures taken to reduce it will create a healthier economy for all in the long run.
My verdict: No tree necessary and less debt.
The Conservative government is currently in the process of making the first real-terms cuts to school spending per pupil since the mid 1990s. These have been so damaging that 500 heads have written an open letter to Theresa May begging for a change of heart, with the National Association of Head Teachers’ leader Russell Hobby stating the cuts ‘put the stability of the whole education system at risk’. Labour have proposed to reverse this with a more than 10% real-terms increase in the school’s budget in England. This will be paid for through the rise in corporation tax as well as the scrapping of the Conservatives’ ridiculous investment in selective free schools; or in other words, Theresa May’s attempt to reduce inequality through reinstating something which entrenches it. Plus, under Labour kids will get free school meals, not 7p worth of cornflakes for breakfast.
My verdict: No tree necessary and less starving children.
There we have it. Those who truly believed in the enchanted nature of Corbyn’s green fingers will be disappointed. It turns out the ‘magic money tree’ is a hoax, a metaphor for ‘no choice’ austerity, representing the socialist ‘utopia’ where people wait under a year for an operation, children get fed at school and the rich pay their fair share of taxes. However, all is not lost. What we have learnt is that Labour’s manifesto is not at the behest of poor farming conditions, it will not be eaten by bugs or shrivel up due to lack of sunlight. Instead, it is a costed well-thought out way of tackling the big problems in our society. The point is Corbyn is not a fraud sitting on an endless pot of gold but is leading a party who are finally offering a genuine alternative to the ailments of our society. Ironically, a fairy-tale victory for Labour will be down to proper values and smart policy, not a fantastical plant.