Article 31

Knowledge/Belief Differentiation with Respect To The Covid-19/Brexit Combination.

This article was prompted by that of Allister Heath, in The Daily Telegraph of 12/11/20, entitled ‘We have one chance to stop Britain’s slide into another socialist nightmare’, and subtitled ‘Even a vaccine won’t halt the Left-wards drift of a society permanently scarred by Covid-19  lockdown’.  It opens by stating that ‘this ought to be a time for hope, for optimism, for celebration even, and yet it is hard to shake off (fear of) impending doom’; that ‘the end of the Covid emergency is finally in sight’; but that ‘this doesn’t mean that all will soon be for the best in this best of all possible worlds’. It goes on to state that ‘yes, the vaccines may allow Britain to return to a society with most of the trappings of normality, hopefully by the spring’; but that ‘is where the Panglossian  vision ends’; and that ‘we will emerge from lockdown a permanently scarred country’. However, I note that Allister Heath does not define “normality”. Nonetheless,  he goes on to state that ‘the old Britain is gone, replaced by a jaded, poorer, more indebted, more risk-averse, and above all, more collectivist economy’; that ‘the story of the past nine months all over the Western World is one of state failure on a colossal scale, ended only by the extraordinary capitalist miracle that is Big Pharma’; that ‘the script could almost have been written by Ludwig von Mises or Ayn Rand’; but that ‘this risks making no difference to the Left-wards, socialist shift, triggered by the virus and our response to it’, which ‘swept up by a tornado of unintended consequences has now set us on course for permanently higher taxes, more red tape, greater paternalism and less freedom’; and that ‘this will apply across the developed world, with the national debts of France, Spain and Italy all soaring by roughly the same amount as ours’; but that ‘Britain, as the least social-democratic, the most culturally entrepreneurial, the most risk-taking of all the large European nations, has the most to lose from the trend to higher taxes and less individual responsibility’; that ‘the British economy may well return to the size it was before the virus struck, by late 2021-early 2022’; but that ‘this would still leave it 2 to 3 percent smaller than it would have been in the absence of Covid-19 and the accompanying lockdowns’; and that ‘the missing-growth will never be caught up, punching a permanent hole in the public finances’. My only quibble with the above analysis is that vaccines are the only products of science in whole sorry tale; that they are not the products of capitalism per se. I note, however that this analysis does not specify how its cited fates can be avoided. 

Nonetheless, it states that ‘the answer, as far as the Resolution Foundation (a purveyor of the centre-Left technocratic consensus in economic policy) is concerned, is eye-watering tax hikes’, which ‘would (post-Brexit) reduce us to ‘a self-governing version of Italy – a country that has stagnated for two decades’; that ‘the dream of a dynamic post-Brexit buccaneering Britain would be dead and buried’; that ‘there is no path for the UK to thrive, no combination of other ingenious Tory policies which can save us. if our tax and spending end up at Continental levels’; that ‘we can forget about levelling up’; that ‘we would be dragged down to the level of the worst-performing European nations, unless we begin to react very differently’. However, I note that Allister Heath does not define this “difference”.  Nonetheless, he opines that ‘there is no sign of this difference’, while I state there is no sign of a definition of what the difference would be.  Indeed, he contents himself with opining what appears to be currently wrong when he states that ‘the report from the Office for Tax Simplification on capital gains tax (CGT) is predictably grim’; that ‘it was commissioned by the Treasury and calls for a large increase in the tax’s scope to include the owners of small businesses and private investors’; that ‘a raid on the petite bourgeoisie and capital in general can only reduce Britain’s performance further’; that ‘the current system is broken and unfair in many ways’; that ‘there are ways of fixing it that don’t lead to double or triple taxation of some income; and that don’t chase billions of pounds out of the UK. However, he doesn’t say what these ways are, though he implies that they ought to be the opposite of what he expects them to be.    

However having thus pushed himself into a corner, he cites ‘the 2020 Tax Commission (which he chaired) as having published a “comprehensive” report eight years ago, which recommended the total abolition of capital gains tax, and its replacement with several other levies, such as a flat tax of 30 percent  on all income from capital (dividends and rents) and from labour (pay and bonuses), and which would  have the consequence of forcing public spending back down to 35 percent of GDP’ which he now recommends ‘as the sort of reform we should be looking at after Covid-19’. Again, I note that the Commission did not question the purposes to which tax revenues are put, while in contrast, I recommend that they should be put to knowledge-only objectives and not to belief-only objectives as they have been thus far; and that they should be put to the knowledge-only means by which, and only by which, such knowledge-only objectives can be achieved in reality. However, Allister Heath does foresee that ‘post-Covid tax hikes would finally destroy the Thatcherite-Blairite-Cameroon consensus’; that ‘the scale and duration of the furlough means millions are now addicted to free money’; and that ‘a JL Partners poll finds that 48 percent of the public don’t want restrictions to be lifted even when a vaccine is rolled-out’.  Again, in contrast to him, and to all other media commentators, I foresee that aversion to taxation might well be moderated, were taxation revenues to be applied to knowledge-only policies for their knowledge-only objectives to be delivered in reality.

Meanwhile, however, he concludes that ‘the culture has changed’; that ‘Britain now loves and expects a bail-out’; that ‘welfarism has now gone mainstream as has the idea that Government doesn’t have a budget constraint’; that ‘the Bank of England can simply print money’; that ‘lockdown has made self-employment and small business creation less attractive’, while ‘working for the state has become more attractive’; that ‘at some point the Government must remake the case for individual self-reliance’; that, ‘in the meantime, it is struggling to fend off ever-louder calls for extension of the welfare state’; that ‘first it was free school meals, next it will be unemployment and every other kind of benefit’; and that ‘other reforms are already under threat including the drive to increase standards in school’. However, he recommends that ‘while the situation is grim, both Right and Left should avoid descending into a defeatist declinism of a sort last seen in the Seventies’; that ‘Remainers believe Britain to be doomed because of Brexit’; that ‘many Brexiteers believe we are doomed because of Covid-19’; and that ‘because of this social-economic drift, and the Government’s environmentalist obsession, others fear we will be prevented from leaveraging our strengths to make the most of our coming independence’; but that ‘this requires the Government, next year, to come up with an entirely new economic strategy that goes further than simply spending borrowed money on Northern infrastructure’; that ‘we must seek to undo the damage from Covid-19’; that ‘we need a plan to reboot all of Britain, to re-ignite our animal spirits, to attract foreign investment, to create millions of new firms, to increase our trend-rate of GDP-growth, and above all to cut the state down to size’; that ‘the Government may not wish to call this austerity’; but that ‘it is Britain’s last chance to fight post-Covid-19 socialism’. However, I would attribute the aforementioned damage to our belief-only response to every issue, and not only to Covid-19 per se.

Again, I observe that while Allister Heath identifies the need for such a plan, he omits to specify its objectives and the means by which these objectives are to be realised. In contrast, I contend that the objectives of the plan must be based on cause-effect knowledge of need and that such need can only be satisfied by the recognition or acquisition of cause-effect knowledge of how to respond. Nonetheless, I am grateful to him for his analysis of what is wrong with our political system, but, as to its correction, I can only take his analysis as an un-intended re-enforcement of my invitation to my readers to support my campaign for knowledge to replace belief in all currently active policy areas, and in all future policy areas, without which, there can be no hope of satisfying any policy-objectives in reality.          16/11/20.