Thursday, March 22, 2007

Many a mickel

OK, budget. Brown is very very clever. Riddle me this - he is inflicting pay cuts by holding wages down to less than inflation, but he gives a net tax cut to salaries/wages in thwe £17K-£43K bracket (according to you master Akehurst. This simultaeously will cut upward pressure on wages whilst also delivering a net benefit to the real size of the public purse. The cut makes brilliant politics because it is a headline cut in the nominal rate of tax, and so many people will benefit, slightly, that all talk of the overall increase in taxation will be swamped.

To my mind, Brown is and remains a highly ingenious Keynsian, with the political nouse to not say so. What we have in action is an incomes policy - IMNSHO.

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