‘I’m sick and tired of the economy trickling down. It never worked.’
Not my words, or even the words of a Labor politician, but the words of US President Joe Biden this week, the leader of the world’s largest economy. And he couldn’t be more right.
The economic trickle-down, I assume, is a thing of the past.
However, weeks after being appointed Prime Minister, Liz Truss appears to be embracing this flawed ideology with plans including lifting the limit on banker bonuses.
It is based on the theory that you must disproportionately support the rich and business in the short term to raise everyone’s standard of living in the long run.
This is a debunked hypothesis, which has failed time and time again. The top 1% will do anything in their power to amass wealth and profits – we cannot improve the lives of people across the country by giving more money to the richest people in society.
At a time when people are experiencing a cost-of-living crisis, while large corporations are grossing out profits, he spectacularly misreads the state of affairs.
The Prime Minister has branded the move to lift the banker’s bonus limit a ‘difficult decision’ – so difficult, it seems, that he has done so within weeks of taking office.
Apart from the moral argument, we should also be clear that there is no relationship between high bonuses and increased performance. In 2014, the redeemed Royal Bank of Scotland handed out a £421 million bonus despite losing seven years in a row.
This decision shows the priority of the Tories. Truss said that ‘pushing economic growth can mean doing unpopular things’, which seems an acknowledgment that he doesn’t care what people think.
Prior to the famous crash of the early 2000s, banker bonuses soared, reaching £16 billion in 2007.
The current limit, introduced in 2014 after the crash, limits the annual payout to twice the banker’s salary, as everyone can see this destructive culture spiraling out of control.
Last year, British banks made £45.6billion in profits – they certainly weren’t on hold.
Labor must be stronger in opposing this change, because it is not anti-business to fight excessive corporate greed. The party must always stand for justice for all.
After all, it seems that salary restrictions are only for those on low incomes, not for bankers. The Governor of the Bank of England has said that workers should not ask for a large pay increase, while the Government has refused to give workers inflation-matched pay increases.
The truth is, the Tory Government will continue to help their wealthy friends, leaving working people short of support in times of despair.
Boris Johnson, the head of liars, may be more adept at hiding his true intentions from the Conservatives.
Liz Truss has admitted to herself that her tax cuts will benefit the rich disproportionately. He didn’t even try to hide it!
And, how could he? The Resolution Foundation says, on average, the richest 10 per cent of households will benefit from the Government’s cost of living measures of around £4,700 per year, while the poorest 10 will receive just £2,200.
We can’t forget that Truss was forced to make humiliating changes even before taking office, because of his plans to cut civil servants’ pay outside London. As Maya Angelou once said, ‘When people show you who they are, believe in them first’.
The real dividing line is clear. To tackle the energy crisis, Labor has consistently called for windfall taxes to tackle excess profits – but Truss prefers to borrow more money from taxpayers.
His change to stamp duty cuts will only help those who can afford a home – not get more people up the ladder.
The facts show that we have a high level of wealth inequality. The gap between the richest in society and the rest of the population has widened over a 10-year period, under successive Tory governments.
This may be why the Treasury refuses to publish UK economic forecasts in addition to Friday’s mini-budget.
The Conservative government has a history of avoiding scrutiny, especially during the pandemic when they refused to publish the full details of procurement contracts for Tory-linked businesses.
These ‘growth-boosting’ measures may result in a temporary increase on paper, but if wealth is hoarded by the wealthiest people in society, it will be hollow.
Under the Tories, it was the working people who created the wealth in this country but only those at the top benefited from it.
Much like the Government’s energy price cap policies, which only deceive and do not address the core problem, I fear these measures are designed to distract people ahead of the next general election.
It’s time to do things differently, focusing on people before profits.
It has to start with an extended windfall tax on excess profits from energy companies so we can support the most vulnerable with their crippling bills.
This must mean giving real pay raises to people who work, because if we properly reward people’s hard work, society will thrive, standards of living will increase, and crime rates will drop because the most vulnerable people in society will get the support they need.
And that must mean protecting those who are fighting hard for the right to strike.
I wrote in my previous column that the Tories were not siding with the workers, that we would see more of the same failure under Liz Truss, and that she had a chance to prove me wrong.
Well, with only a few weeks of being prime minister, I fear I’ve been proven right.
This government, like the previous ones, cannot be trusted – it’s time for real change with Labour.
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Source : metro.co.uk