Aren’t they the sort of migrants we want? High earners, paying lots of tax?
Let me elucidate. A key premise underlying neoliberal thought is, as I stated above, that there is a limited pie and we all must, roughly equally, fight for our share of it.
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Nope, that is your thinking. The question is how to increase the pie in the UK. The problem with low skilled migration, where the migrants pay less tax than 11.5K is this. They may will increase the size of the pie, but its divided amongst more people. End result, particularly at the low skilled end, is that they end up with less than before. At the top end, they get their work done cheaper, at the expense of the poor.
Now change that. Only get in highly paid. Pie increases, and because the high paid want their baristas etc, the unemployed get jobs. Less tax going on benefits, and the low paid workers are better off.
On asset inflation, I tend to agree. However, the cause of that is taxation. Lets say you are going to risk 100K on a business. Lets say you invest in 100 such businesses. What percentage are going to work? How much do you need from the others after tax to get a return. Do the maths. It’s shocking.
On the scarcity of pie. I don’t buy it. That’s the socialist that says you need to divide up the pie in a different way. Not me. I’m for growing it .
What you need to look at is government debt. In particular the pensions debt. It’s off the books. Bernie Maddoff did the same, for the same reason. All modern economics bar behavioural theory is intellectual masturbation because its based on the assumption it doesn’t exist. That applies to all the parties.
Here’s a hint. The pension debts, state pension and civil service pensions are over 6,500 bn on top of the 1,200 bn borrowing. Growth of the debt is 850 bn a year. Total tax, 600 bn a year. See the ONS for the numbers.
You don’t need MMT or anything else to work out what’s going to happen, and the result is the poor get shafted.
Please give me some figures around your comments - e.g. what % of migrants don’t pay at least that in tax. Where do you get that ave govt spend?
And don’t use terms like “in fact the opposite”. That’s just trite.
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Which is already 12 times your original demagogic claim, and that’s not even including the £500-£1000 in VAT the government will collect from the barista, and other taxes on top of that (excise duty, fuel duty, etc etc.).
And all this is quibbling over your original scare-story of an economy-draining Starbucks barista. What about the over-all effect of migrants – real ones, poor and rich together, baristas included?
Turns out that immigrants in the UK pay more in tax than they consume in public services. (Original report.)
Your taxes would be higher and your government would have less to spend on your NHS if it weren’t for immigrants making a significant, positive contribution to the economy. Next time you go to the doctor, maybe you should thank an immigrant?
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Well median wage is 26K. I don’t take the racist view that migrants are better or worse than other people in the UK.
http://www.listentotaxman.com/ does the tax calc for you. 5,502.24 for 26K. To get to break even on income tax and NI you need to be earning 44,000.
So let me turn it round. Does the average migrant earn 44K per migrant? No, they don’t.
Average government spend is easy. http://www.ukpublicspending.co.uk/ for the spend.
Population of the UK is 63.23 million.
I leave the division of one by the other up to you.,
Well its not. There are other sites if you google that put the wages lower. However min wage is a reasonable estimate.
Which is already 12 times your original demagogic claim, and that’s not even including the £500-£1000 in VAT the government will collect from the barista, and other taxes on top of that (excise duty, fuel duty, etc etc.).
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But the spend per person on average is 11.5K.
So even totalling up the other taxes and assuming that they go no other money such as housing benefit, it doesn’t add up.
Don’t forget, that the pension debts are growing at 734 bn a year according to the ONS. That’s ignored.
When you say “average government spending per person is 11.5K/year,” you’re right, in that the government spends 11.5K times more than the current population. But the way you’re saying it implies that each new resident will cost the government an additional 11.5K/year. From your link, I’ll agree that pension, health care, education, and welfare costs will apply to each new resident, though I don’t think that most of the things in the “remainder” section, which is 34% of spending, have a 1:1 correlation to population increase. Though things like defense spending will probably increase over time, I would argue that they would increase independent of population increase.
If you add pension, health care, education, and welfare spending, you get 474.9K, which is pretty damn different from 718.8K, the total spending. If you base the numbers off of this sum instead, then the average government spending per person in terms of population increase is 7.5K/year instead of 11.5K/year. That’s a pretty big difference.
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On average, yes. However, that 11.5K ignores the increase in pensions. The pensions debt. The 11.5K only includes the current cost of pensions. The state is effectively borrowing that money, and its going on the debt. Not that you can easily tell because the state ignores that bit.
As for your conclusion, it doesn’t make sense. To summarise it, if we ignore lots of spending, we can come up with a smaller figure. Why not ignore all spending and come up with an even smaller and equally false number?
Now, these are averages. If we get in migrants who don’t bring in spouses and children, then you could make an argument saying for them, the 11.5K should be lower. [Ignoring pensions again]
However, what you aren’t addressing is the simple point. Why should the poor lose out because money is being spent on optional (the key point) migrants, who consume more in resources than they contribute in tax?
I’ve read it. Doesn’t make sense when the average spend is 11.5K. What’s going on is that they are ignoring parts of the spend.
However, that is back to the average argument.
Let me turn it round. What about the migrants in your argument who don’t pay in more tax than they consume? Why should other people subsidise them.
As for the Doctor argument. Lets say we pull in a Doctor from the third world. What do you say to that patient in the third world who is dying because the doctor they paid to be trained has hopped it to the NHS? For the UK in this case, its a great thing. We get them on the cheap. They cost money, but we haven’t had to train them. Moral? I think not.
Jingoism and nationalism are not racism, but they like to hang out together.
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OK. Give me a reference for a page in the OECD paper that gives the earners or the tax pay by migrants so we can see if the report is correct. Namely they pay more than 11.5K a year on average.
Let me also illustrate the argument as to why you are wrong with a couple of well known migrants, and you can tell me why you want both here.
- Abu Hamzah
- Abramovich
Make the case for why we have to have both here in the economic sense, It’s what you are arguing for. I’m arguing for the exclusion of 1 and the inclusion of 2, Somewhere in between there is a line, and there’s a valid argument as to where it is.
How do you know what the average earnings of migrants is?
You must work in politics.
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According to an image from the link that you posted, pensions are included in the total spending number that you’re using:
Just to make sure we’re on the same page: 719,000M/63.23M = 11.4K, your number.
I wasn’t randomly ignoring lots of spending; I was discounting certain spending which doesn’t have a direct relationship to population increase.
Well, this is all contingent on your assertion that migrants consume more than they contribute in tax, which I don’t believe, and it seems like most of the other folks here don’t believe either.
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By stating that you contradict yourself and admit that your concern is with the size of the pie. There is no problem with the size of a pie that can be enlarged at any time. The problem comes from the fact that the pie is only enlarged to feed the maw of capital and finance, never to feed the people.
We do not agree. Inflation isn’t caused by taxation, its caused by an overwhelming amount of money sloshing around the financial system looking for yield. When you pump money into any market prices rise. That’s the cause of asset inflation.
You are still misunderstanding. This is not socialism v. capitalism. Its basic economics. The government controls the money supply (the “pie” we keep speaking of). Western governments, in the current era, are refusing to enlarge that supply except to the feed the already over-stuffed financial sector under the flawed and clearly failed assumption that a sick, criminal financial system knows best how to supply that money to the economy for growth. If that premise were true, the western nations would be strengthening economically instead of continuing to weaken. The money, “growth” as you put it, is not making its way into the pockets of the people who create demand in the first place – you and me, the “masses” – thus there is no growth (businesses will not hire/increase production if they don’t have customers – we live in the real world, the demand side world, not the supply side fantasy world where “animal spirits” and trickle down economics supposedly provide widespread prosperity).
On top of this, 97% of the money in circulation is debt-based (has interested being paid on it to banks). Instead, the money should be created by the government, debt-free. The current state of affairs places a massive tax on the access to money, known as economic rent, and is helping to drag down our economies.
No, its not. Actually, especially in the US (and UK, EU), public debt is not at historically high levels. If it really were so, as opposed to the hype you are consuming, why would the private sector be gobbling up sovereign bonds with such gusto? In other words, if our nations were near bankruptcy, “savvy” investors would know to stay away. Because the reality is that in a fiat currency system, the government can always pay its debts. The rest is kabuki designed to stoke fear and keep the financial cartels operating in a business-as-usual environment.
On top of that, government doesn’t need to “finance” its money printing by selling debt securities. These holdovers from the gold standard era are maintained fictions such that the .1% can control governments: being their primary creditors gives them dictatorial powers over their debtor (the govt/taxpayer).
No. Neoclassical and neo-Keynesian economics don’t model for debt. They don’t model for a banking system either. MMT does. MMT, unlike mainstream (neoclassical) econ, has keen insights into the way finance and debt works in modern economies.
Nice trick to use billions to make the numbers look bigger than they are. $6.5 trillion is less than half of US yearly GDP. The Fed managed to come up with $13 trillion on the spot to save the criminal banking system. They’ve come up with another $12 trillion since 2009 for “quantitative easing”. Your cadre loves to throw up scary numbers but without context they are meaningless (not to mention that many of them are projections decades into the future, which are notoriously inaccurate, and many other “scary” numbers are basically made up).
The US government could provide fiscal stimulus of $10 trillion tomorrow, and if it was done in conjunction with thorough reform and reduction of the financial sector, a rejuvenation of the US manufacturing economy and shifting the tax burden off labor and back onto rent-seeking (land, corporate profits), and a higher minimum wage (say $18/hour), within 2-3 years the US economy would be the healthiest in the world.
The poor are only getting shafted because of who is controlling economic policy in the US. It wasn’t always thus: the mid 20th century saw real leadership in the public interest where men and women of conscience came to understand that the people of the US are truly where a healthy economy resides. This has been forgotten, and covered over with layers of bullshit in the form of neoliberal dogma and lies.
Your fears are understandable. Your solutions are not.
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I’m trying to understand the argument you are making.
What you are saying is that migrants don’t pay for goods that aren’t population related, but natives (for want of a word), pay everything.
So why should natives pay and migrants get for free?
Well, this is all contingent on your assertion that migrants consume more than they contribute in tax, which I don’t believe, and it seems like most of the other folks here don’t believe either.
Not my argument. If you don’t understand it you haven’t read what I’ve written, you’ve misread.
Some migrants consume more than they contribute in tax. Some migrants do not.
The UK can make a choice over which migrants it chooses to have here and which it doesn’t. I’m saying we should accept those economic migrants who are beneficial and reject those who aren’t.
e.g Lets take an extreme case.
- Abu Hamzah
- Abramovich.
If we take your argument, you are all for Abu Hamzah being in the UK, on benefit and running up huge legal aid bills. It follows from you argument that if one migrant is good that means all arguments must be great.
So are you in favour of radical preachers on benefits in the UK, consuming resources?
It…kind of doesn’t. After inspecting it for a minute or so, I think it’s saying that most migrants into the UK and Scotland are young? And…I’m not sure what I’m meant to conclude from that. Immigrants have a lot of productive working years ahead of them? Immigrants will help with elder care? Immigrants will take over youth culture?
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Correct. Now look at the affect of taxation on yields. If you tax one area heavily, such as enterprise and apply a light taxation or none at all to assets, what happens? Money moves to assets, causing the price to rise, equalling out the yields over time. Taxation has a direct effect on asset price inflation. Likewise if you tax consumption, you reduce consumption. If you tax work, you reduce the incentive to work or the incentive to move tax jurisdiction. You can’t claim tax doesn’t have an effect.
The post is about the UK. 6,500 bn GBP is the size of the pension debts in the UK. You have a US centric view. To put that in context and scale it for the US, you need to multiply by 5 for the population difference, and then convert to USD. That’s a pension debt alone of 52,315 bn USD scaled for population.
By stating that you contradict yourself and admit that your concern is with the size of the pie. There is no problem with the size of a pie that can be enlarged at any time. The problem comes from the fact that the pie is only enlarged to feed the maw of capital and finance, never to feed the people.
I presume you mean printing. Doesnt’ work. Printing means inflation. People want purchasing power.
Taxes have, at best, a secondary affect on where money is invested. Enterprise investments don’t occur because taxes are low, they occur because there are customers willing and able to purchase the outputs of the enterprise.
If pension funds have been abused in the UK the way they have been in the US its no wonder they’re indebted.
First off lets clarify that we are talking about price inflation. Printing DOESN’T mean price inflation. Not in a vacuum. The only way money printing leads to inflation is if the economy is at full employment and full productive capacity. We are in no danger of these conditions at all. I don’t know the UK numbers, but in the US the REAL unemployment rate is somewhere north of 20%. Productive capacity is nowhere near where it could be. Without these factors, there is no pressure on supply (we can create more), and there is no upward pressure on wages (labor is a buyer’s market with so much unemployment). Thus no price inflation. This is a phantom fear stoked by the Fed and the mainstream of the economics profession because if wages and prices rise, the assets the rich own become devalued.
That’s why fiscal policy, combined with the reforms I mentioned in my prior post, is the ONLY solution that will work to avoid decades of poverty and stagnation. Unfortunately our political class is in thrall to the neoliberal establishment and so stagnation will be the result.
To reiterate, the pie is as big as we want to make it. This is true because we have enough supply of the things we need to live for everyone and are only constrained by the artificial scarcity imposed by the money hoarders. That is why hundreds of millions go hungry while food rots on supermarket shelves. That’s why millions are homeless while homes lie empty and rotting. The waste is massive and is the result of the total abdication of the government in ensuring balanced prosperity via fiscal, labor, industrial, anti-trust and tax policy, and the accompanying massive inequality and immiseration of the masses.
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You’re bewildering. I’m not even sure if you’re driving trollies or not.
What?
And now you’re putting words in my mouth:
When in fact I said:
I was only saying that the increase in population would not mean the increase in spending that you suggested, since your “spending per capita” figure was based off of several categories of spending, some of which will not increase directly because of a population increase. I said nothing about who should be paying for the government spending, so your assertion that I would have the natives pay all and the immigrants pay nothing is completely unfounded. Of course natives and immigrants in equal situations should be paying equal tax.
Of course I agree with you here:
But here:[quote=“nickle, post:101, topic:14415”]
If we take your argument, you are all for Abu Hamzah being in the UK, on benefit and running up huge legal aid bills. It follows from you argument that if one migrant is good that means all arguments must be great.
So are you in favour of radical preachers on benefits in the UK, consuming resources?
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You are way off base; if you look through my posts, you will see that I never said anything about whom the UK should allow in, and I’m not going to start now. I only said that your numbers were misleading, and I still believe them to be.
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