An Englishman's home is his tax liability
Valuable insight from the Daily Sceptic...
We need to get inside the Labour mindset to anticipate the level of dogmatic mischief that is being hatched
The War on the Family Home
July 21, 2024
"... A great novelist can, in a short passage, say more than a thousand scholars or non-fiction writers can in a lifetime.
Hence, Dostoyevsky had modern technocracy’s number before it had really ever even been put into effect. In the section of the Brothers Karamazov now usually called the ‘Grand Inquisitor’, he laid it all out. In this story-within-a-story, Jesus is imagined to have returned to 16th Century Spain and is put on trial by the Inquisition. The accusation: that in rejecting the offer from Satan, when tempted in the desert, to be made ruler of the world, Jesus condemned mankind to freedom and thereby to suffering. It would have been better if he had accepted Satan’s offer and taken the opportunity to simply make everybody good, safe and content. The head of the Inquisition, the Grand Inquisitor, then paints a picture of what the appropriate relationship between the people and the church should be:
[A]ll, all will they bring to us, and we shall resolve it all, and they will attend our decision with joy, because it will deliver them from the great anxiety and fearsome torments of free and individual decision.
There are, then, Dostoyevsky is telling us, people in the world who think that the real problem with Jesus was that he wanted people to be free. Just think of the good I could do, these people say to themselves, if only I were in charge of every decision that anybody could ever conceivably make. I would make everything perfect. The implication is that freedom is necessarily undesirable; people should be made to do what is good for them, and free choice can only either get in the way of that objective or align with it – in which latter case it is moot.
One of the major exemplars of this school of thought was John Maynard Keynes. In his 1926 essay, ‘The End of Laissez-Faire’, Keynes – with a blitheness that is truly chilling – makes his contempt for freedom very clear. “Nor is it true,” he tells us in his very opening paragraph, “that self-interest generally is enlightened; more often individuals acting separately to promote their own ends are too ignorant or too weak to attain even these.” And since this is the case, the last thing that anybody should want is individuals disposing of their own wealth as they see fit. That would leave too much to ‘chance’. Much better for intermediary bodies – in effect, quangos – to decide how much wealth people should be allowed to accumulate and where it should be invested (even to the extent of deciding how much of it should be invested abroad). “I believe,” Keynes wrote (stop for a moment and try to put yourself in the mind of somebody who had it in himself to write these lines):
[T]hat some co-ordinated act of intelligent judgement is required as to the scale on which it is desirable that the community as a whole should save.
This is the Grand Inquisitorial mentality, as it is applied to economics, in a nutshell: the last thing that anybody needs is people deciding for themselves how much money they should save. That is a matter of “intelligent judgement”, and this is a thing which ordinary people simply do not possess. No – the “desirable” level of saving is something upon which clever people should decide, and then impose on society. And much of the paraphernalia of modern macro-economic management follows from there, of course: the discovery of the “desirable” level of aggregate savings (and hence of spending), and the subsequent manipulation of the population into adopting it.
Keynes wrote at a time when the Labour Party was in its infancy, but it is his mentality – a Grand Inquisitorial mentality – that has come to permeate the way the party thinks about wealth and property. Hence, we come to a recent interview with John McTernan, a New Labour high-up and muchacho of Tony Blair, in which (likewise, with a blitheness that is truly chilling) we find the issue of housing coming under the lens of discussion. Again, stop for a moment and try to put yourself in the mind of somebody who has it in himself to say something like this:
A lot of wealth in the U.K. is in the form of housing wealth. It seems right that you should actually extract some revenue from that…. The reality is that the largest amount of wealth outside pensions held in the country, they’re actually held in the form of housing… Now, you can think what you like about housing, and housing is definitely a social need, but housing is a capital asset that’s been accumulating, particularly accumulating in the period of quantitative easing. It was a windfall to most homeowners, the fact that the houses that they lived in have gone up in value, some of them even faster than their income went up. And I was able to figure that two trillion pounds in value increased to them, accumulated to housing in Britain during the pandemic when we were literally doing nothing but staying at home. Now, that is a windfall, and windfalls should get a windfall tax.
There are times when one feels as though public discourse has become too uncivil and that it would be nice if everybody remembered that, generally speaking, even one’s political opponents are approaching the matter of public policy in good faith. But there are other times when one is driven to agree with Pierre-Joseph Proudhon that the real issue we face is that we are governed “by creatures who have neither the right nor the wisdom nor the virtue to do so”. This is one of those occasions: anybody who could utter the words reprinted above with a straight face should not be allowed within a country mile of the levers of power. And it is frankly mildly terrifying that such a person should be in a position to advise the U.K. Government about anything – let alone something as important as tax.
Let’s leave to one side the sheer gall of suggesting that the debasement of the currency in the form of quantitative easing and the subsequent inflation of asset prices – all of which caused by the arrogance of Keynesian central bankers pursuing ‘unconventional’ monetary policy – constitutes a windfall for homeowners, as though it was some sort of freak weather event rather than a foolish way of propping up a zombie economy in the aftermath of the 2008 financial crisis. Quantitative easing was, and is, a policy choice – it was not a surprisingly bounteous bumper crop of cherries from the orchard which Scrooge-like orchard owners have been unfairly squirrelling away for themselves in the basement. And suggesting that its consequences should therefore be a windfall tax for homeowners takes a special level of mendacity: in McTernan-world, it seems, government broadly constituted (and one should by all means include the Bank of England under that umbrella) has licence not only to collectively make public policy errors, but then to traduce the public for receiving whatever ‘windfalls’ they do as a result, and to tax them for it to boot. That is a world that should only exist in fantasy.
And let’s leave to one side the suggestion that lockdown – a policy choice that truly merits the use of the word ‘catastrophic’ – was also simply an inevitable consequence of the pandemic (“when we were literally doing nothing but staying at home” – speak for yourself, mate; some of us had kids to look after, and some of us had jobs to do). To repeat: lockdown was not a weather event. It was imposed. That it was going to have serious economic consequences was evident to anybody with an ounce of sense at the time. The decision was taken to impose it anyway; the idea that it “seems right” to extract revenue from homeowners, who had no say in the matter, as a consequence takes, again, an exceptional level of gall.
And let’s also leave to one side the fact that one of the main drivers of the growth in house prices has been a chronic failure of supply to meet demand, and that this is more or less entirely the fault of repeated governments’ failure to grasp the nettle of planning reform, combined with high levels of immigration – both of which, again, are not weather events, but policies which have been deliberately chosen and pursued, and therefore not to be described as ‘windfalls’ in their effects on house prices, but as the necessary and obvious consequences of decisions made in government.
The reason for leaving all of these observations to one side, as important as they might be, however, is that they would distract us from the more important matter of what McTernan’s comments reveal about the mindset of those who now imagine themselves to be in charge of the U.K. economy.
Some time ago, I wrote a piece about an elderly couple who had been erroneously told that a house they owned would be compulsorily purchased by the local council to house asylum seekers. In it, following Leo Strauss, I made the observation that it was crucial for a tyrant to eliminate property rights and ultimately private property entirely. This is because a population of property owners is a population that has a route to independent prosperity, and independent prosperity is definitionally not what a tyrant wants. A tyrant wants the population to be reliant on him, so that he can retain their loyalty. Hence, as Strauss himself puts it (these words need to be printed and distributed on posters and t-shirts):
[The wise tyrant] would consider his [entire] fatherland his private property which he would naturally administer according to his own discretion.
The consequence is that tyranny is contingent upon an idea of property as something not which the population owns, but which is bestowed upon them in the manner of a gift, and on sufferance. If they are good boys and girls they get to ‘own’ a house, but they always have to remember that just as the tyrant giveth, the tyrant taketh away; and ideally in the end there will be no home ownership at all – everybody will be ‘housed’ (it is noticeable that McTernan generally, though not always, prefers to refer to ‘housing’ than ‘homes’) by the State, and be grateful for it.
In this sense, as elsewhere, then, it is sensible and apt to describe the trajectory that we are on as one that is in its essence tyrannical, even if to call the likes of John McTernan ‘tyrants’ would strike most people as hyperbolic. We are, in comparative terms, relatively early on in that trajectory, but it charts the direction in which we are heading: the gradual dissolution of the concept of private prosperity, and its gradual replacement by Keynes’s ‘intelligent judgement’, carefully and minutely micro-managing economic decision making at every level, and every given moment. And this is being done in the name of an inchoate and incompletely expressed ideal, within which no individual should ever be put in a position to exercise choice at all, since that would interfere – to take us back to Dostoyevsky – with the achievement of “joy [at being] deliver[ed] from the great anxiety and fearsome torments of free and individual decision”. Since delivering the population from the “great anxiety and fearsome torments of free and individual decision” is the essence of the promise that the tyrant makes, the explanation for the contempt for private property on display in McTernan’s comments becomes very plain.
It should nonetheless appall us. There is one, generally attestable, route to prosperity for the poor: the gradual accumulation of savings and capital in the form of property. I know this because my family has lived it; from both sides I am of Irish immigrant stock, supplanted into Liverpool and Glasgow respectively; my grandfathers were both skilled labourers and my parents were born into poverty. But the family collectively dragged itself up into something approaching a middle class lifestyle through home ownership, and I hope that my children will be dragged up further yet by the inheritances that they will one day receive from all of the hard work, effort and sacrifice that three generations have made on their behalf. To hear the likes of John McTernan suggesting that it “seems right that [the government] should actually extract some revenue from that” is – I am anxious not to use inflammatory language – shameful. That his mentality is so widespread across the political class is more shameful yet. But it speaks to the real source of our malaise: to own property is to be in a position, if one is lucky, to grasp at “free and individual decision”. And free and individual decisions are simply not what those who govern us want us to make – because a population capable of making free and individual decisions does not need government very much at all.
None of this is, in the end, very complicated, despite being rather shocking. Keynes did not want people to be free; nor did he wish for them to become prosperous. What he wanted was for them to obey the strictures of those who were “work[ing] out a social organisation which shall be as efficient as possible”; society was an interesting technical problem in need of solving, not a body of people with value in their own right.
That was his mindset; it is also that of John McTernan; it is in the end what animates the Labour Party in particular. Those of us who live in the U.K. will have to get used to this mode of thinking, which, although it has been implicit for many years, is going to become increasingly explicit, and increasingly brazen, as Labour rediscovers its muscle memory and begins once more to flex. “It seems right that you should actually extract some revenue from that” is going to be the order of the day, across the piece. On second thoughts, maybe that’s what should be being printed on t-shirts.
Dr. David McGrogan is an Associate Professor of Law at Northumbria Law School. You can subscribe to his Substack – News From Uncibal – here