2011: THE WRITING’S ON THE WALL

Georgie Porgie takes a well earned break from robbing the poor

One week into our first full year of austerity and you can see 2011 unravelling before your eyes…

No sooner had Osborne returned from his ‘we’re all in this together’ £11,000 family skiing jaunt in Klosters – the winter playground of the super-rich – and VAT hits 20%, its highest ever level. Osborne desperately made the case that it’s a progressive tax, based on the simple economics of expenditure: if you earn more money, you buy more expensive shit, so you pay more in tax. Brilliant.
Of course, everyone except Osborne looks at the tax burden in terms of household income not expenditure and in this respect the poorest are hit hardest by the rise in VAT…

No surprise then that VAT is widely regarded as one of the more regressive tools available to the Treasury Tool. Indeed Cameron admitted as much while on a factory visit this week: “If you look at the effect [of VAT] as compared with people’s income then, yes, it is regressive.” So, that’s cleared that one up.

And as prices rise on the high street (and petrol reaches record levels at the pump), so the average wage packet is now set to fall in real terms. With public sector workers facing pay freezes and many in the private sector chasing pay rises that can’t keep up with inflation, so the cost of living will become increasingly prohibitive for all. All, that is, except for the Bankers and the Company Directors . A study by the Incomes Data Services this week showed that for the year to October the total earnings of FTSE 100 directors rose by 55%. We’re all in this together.

Throw in the fact that the fallout from last year’s Emergency Budget and Spending Review is poised to take effect, in terms of job losses and cuts to front line services, and it’s not hard to see 2011 shaping up as a year of socio-economic upheaval and civil unrest. Indeed, there are demonstrations already planned: March 26th will see the TUC join forces with Students for a demonstration against the spending cuts. March for the Alternative: Jobs, Growth, Justice will see both groups marching to a rally in Hyde Park calling for a Robin Hood tax on the banks, the closing of tax loopholes and policies for jobs and green growth.

Happy New Year x