Saturday 28 September 2013

The Politics of the Marriage Tax Breaks

The Conservatives are a desperate party led by a desperate man. The stars are not lining up for an election victory in 2015, despite a summer of awful headlines for the Labour leader; and Dave finds himself with little room for manoeuvre now Ed has pledged action on the issues that matter outside the Westminster circus. To grab the headlines and the attentions of the voters, this weekend's Conservative Party conference needed something bold and something that would save people a packet of cash.

Hence the marriage tax break. Of course, not every married couple in the land will qualify. And the policy is highly problematic. But £200/year isn't to be sniffed at. So, why the rush to "incentivise" marriage?

1. Beneath the restaurant-smashing Flashman act, Dave is a big old softy. He thinks the hallowed institution is the bee's knees. As it is for many Tories, marriage is the bedrock on which a stable society thrives. Providence has given us the means for realising a secure environment for the raising of children and establishing a strong bond of certainty between two loving people. If more people get married, regardless of the sexuality of the partners, the happier and more fulfilled our society will become. And having one partner take time out from work to raise the kids might do a little bit to massage the jobless figures too.

2. Dave has struggled to find a way of driving a wedge between disenchanted Tory voters and UKIP that won't see the softer support fall away should he adopt a tough rightwing stance on the issues 'kippers care about. Pushing a policy that might be seen as strengthening marriage is one of the precious few ways he could woo fed up Tories giving UKIP the eye without upsetting the other.

3. Admiral Ackbar says "it's a trap!" Dave has divined correctly that Labour, the LibDems and a whole host of other opponents would be opposed to the marriage tax break. And how easy it will be to paint them all as enemies of marriage and "traditional values". As the tropes for 2015's campaign of vilification are being polished up before their ultimate reveal, the reds and the yellows will be singled out for being "anti-family". Now, Dave and Crosby might think they've been clever clever and boxed them into a toxic position. But it's like lobbing a mustard gas shell that not only falls short of the enemy trench, but is blown back toward your position by the wind. They are effectively saying to millions of couples who co-habit, have kids out of marriage, or are single parents that their situation is not good enough and that they should pay more tax than people who've made a lifestyle choice the Tories approve of.

They think they're getting out of a hole. But in fact, they're digging it much deeper.


Robert said...

This social conservative stuff backfired in the Nineties so it's not likely to work for the Tories now. I seem to recal guys like JOhn Redwood being very frustrated that the campaign against single mothers didn't work back then either.

Boffy said...

£200 is not likely to cut much ice when you've had thousands of pounds in Tax Credits taken from you, when you've lost thousands in the VAT hike (why does no one take the Liberals up about VAT when they crow about the increase in the Income Tax threshold) and so on.

Desperate is the term I had in my mind for a blog too, along with the term desolate. Cameron's announcement that they are binging forward the "Help To Buy Votes" scam, is an indication both of desperation and desolation.

Every economist on the plant describes HTB as bonkers. A few months ago, in the financial media the talk was about rising house prices bringing increased confidence and economic activity, now the talk is about the existence of a property bubble, and the dangers it presents.

On CNBC the other day, it was pointed out that in the North West prices in general are still falling. The existing HTB had the effect of creating another distortion. New houses were being sold because of the subsidy, and their prices were rising slightly, but because the subsidy made existing houses relatively less attractive to buy, it pushed their prices down further.

Moreover, it appeared that the new homes, when they came up for re-sale could not reach their previous sale price.

London prices are now at an historic high of more than 10 times earnings. On CNBC last week they were taking the piss about the fact that Osborne has passed responsibility for monitoring house prices to the BoE, but they are not to look at whether they are in a bubble until next September!

In other words the Tories know they are creating a bubble that will burst, but they want to just buy votes, and hope it bursts after the election. That shows they are desolate of any ideas.

Bringing forward the new HTB scam is good, because the sooner its put in place, the sooner the bubble will have been fully inflated, and the sooner it will burst, blowing the Liberal-Tories away with it, probably for a very long time.

Gary Elsby said...

I think on considered reflection that you are mistaken with this Phil.
The amount is negligible but so has the thought of marriage being worth something.
marriage will be now worth something and only if you thought it needed to mean something financially.
many people don't need to get married and many people do.
So what is the point of marriage?

I think Dave is beginning to ask the question, even if it's in purely financially irrelevant terms.
There was hell up when the tax allowance was removed.

Labour's response will be that marriage is not worth even a small financial gain?
Dodgy ground.

asquith said...

I can confirm that wedding bells won't be ringing for me. I have a girlfriend, but she lives in Birmingham and it's never even come up that we might live together, let alone marry. I would actually like to see her a bit for often but it's still bachelor status for me. None of this fatherhood shite either.

We are still better off than we were in the days when marriage was something that you did, because it was something everyone did, apart from people who didn't fit into the "tight-knit community" and were shunned.

I can vaguely see the point about wanting more people being brought into loving, monogamous unions and children faring better in solid families. And I think part of the reason Cameron was so forceful for equal marriage was because he thinks LGBT people shouldn't be excluded from the wedded bliss he has with Samantha.

By all accounts, their union is happier than my parents, who stuck it out until, 27 years down the line and with me and my brother grown up, it became undeniable that there was in fact no point in their marriage.

I think this is one of things that has (relatively) little to do with calculation and more to do with thinking it's a good idea. And

Phil said...

Boffy, do you think the Help To Buy bubble will burst before the election? Given the continued decline in real wages I can't see it having much mileage.

Phil said...

I disagree Gary for the reasons stated in this post.

I'll probably write more tomorrow night after Dave's speech. NB Labour are being careful not to say they're opposed to marriage, but rather it's not a lifestyle choice that should be privileged above others.

Btw, can we expect to see you out and about in Baddeley, Milton and Norton this next month or so?