Couldn't Agree More

Rory Sutherland: A mansion tax that monkeys would understand

2 Comments14 September 2013Rory Sutherland 

I am surprised no more attention has been given to Martin Vander Weyer’s suggestion in The Spectator two weeks ago that a mansion tax should be levied on those buyers who pay no other UK tax. Why has it taken so long for anyone to raise this idea? Where tax paid against income should be set against tax paid on property?

Let’s consider this question in psychological terms. Assume that you are eager to buy a particular house but someone else decides he wants to live there too. He is twice as rich as you are and so comfortably outbids you. Whatever the other person’s moral worth, you know two things. He has become rich under roughly the same system as you. And he has, in the process, paid more tax than you.

Now consider another scenario. This time you are outbid by a mysterious Russian who somehow bribed an official in some remote oblast to sell him a smelting works for 200,000 packets of Kent cigarettes and a Cadillac Escalade. He has paid no tax in the UK ever, nor does he intend to do so. He likes owning a house in London because our legal system gives him a safe refuge for his money and from the attentions of his former business associates. Here a mental klaxon should go off. Is it fair that people paying 40 or 45 per cent UK tax must compete for housing against people who pay none? To anyone other than an economist, the answer to this question is probably no.

Martin’s solution makes obvious sense. You should be made exempt from any mansion tax in the UK provided you are currently paying — or have paid in the past — a level of UK tax commensurate with the value of your house.

To consider policies of this kind it would help if policymakers paid more attention to a few other areas of social study besides economics. Primatologists now study ‘inequity aversion’ in capuchin monkeys and chimpanzees. What these studies seem to show is that most social primates are not egalitarian — but nonetheless have a strong sense of fair play. We should study this idea of inequity more. And devote more thought to work by social scientists such as the late Elinor Ostrom and her observations about the necessary conditions for effective social co-operation.

Much of the deadlock in political debate could be broken if government had not awarded to economists an effective monopoly among social scientists in the formulation of policy, thereby causing all political debate to be framed by a narrow set of morally blind assumptions. The reason this happened on the right is at least understandable — right-wing politicos were probably so grateful to find some academics whose work defended free-market actions that they bought into the doctrine wholesale. What’s far more surprising is that this economic autism has infected politicians on the left: immigration, for instance, is often debated by right and left as though the only relevant consideration is its effect on GDP.

The brutal truth is that economics is more influential than it deserves to be, given its hopeless record of prediction. One writer recently suggested that we should mentally replace the word ‘economist’ in all news reports with ‘shaman’, ‘astrologer’ or ‘dowser’. Thankfully there’s now software which allows you to do this automatically. The Google Chrome extension ‘In My Words’ makes your browser replace hated words with any new phrase of your choice. The original idea was to supplant phrases such as LOL with something less irritating. But its uses are limitless. It certainly transforms estate agents’ websites: ‘vibrant’, ‘up-and-coming’ and ‘scope for improvement’ become ‘noisy’, ‘dangerous’ and ‘at risk of collapse’.

Rory Sutherland is vice-chairman of Ogilvy Group UK.

Idle, previously

Worth the Licence Fee

The Wipers Times - did you see it last night? Beeb 2. Absolutely outstanding. Wonderfully acted (who had heard of Ben Chaplin, apart from his mother and his agent, until last night?), brilliantly scripted, laugh out loud funny and genuinely moving without a grain of sentimentality.

Three cheers for Ian Hislop and Nick Newman. Hislop has done some outstanding documentaries in his time but isn't particularly funny, either in the Eye or on HIGNFY. This short film is a gem, though. Black humour at its best, great characterisation, utterly authentic (I will allow the director the artistic license that there appeared to be only 2 officers and 20 other ranks within Captain Roberts' company) and hugely worthwhile. Extraordinary that it was a true story that spawned it. Thank heavens the two main protagonists - dilettante young officers, but heroic - survived the war, Ypres/Somme/Ypres. What were the chances of that?

Even if you don't watch television, look this up on BBC iPlayer and watch it. You'll thank me. Utterly memorable. Chaplin should be mentioned in dispatches for best actor at the BAFTAs next time. Julian Rhind-Tutt (crazy name, crazy guy, always good) was a fine foil to Chaplin, a razor-sharp dry wit. Weirdly, they both made me proud to have been a soldier.

Nearest Thing to a Book Review

Two firsts to announce at the start: I’ve never willingly read girlie fiction before, nor have I ever reviewed a book (unless A Level critical essays count). Girlie fiction, if it can be crudely simplified, is fiction written by girls (or an effeminate bloke, I suppose) for girls (or other effeminate blokes, I suppose). Let’s agree for the sake of brevity that it’s girlie stuff written by girls for girls. Or women for women.

And I’d better make a full disclosure – Elizabeth Forbes is a very good friend of mine. She is by no means just a girl, though she pulls off that particular skill quite effortlessly and splendidly. No, by heavens – she is a wife, a mother, a chicken-fancier and also a hard drinking, dice-throwing salmon fisherman, as happy wading up to her ochsters in a treacherous spate river as she is behind the wheel of a fast car or in charge of a pack of rat-killing terriers. I might  be over-egging things here, but Lizzie will forgive me. It's what we writers call 'characterisation'.

Nearest Thing to Crazy is an imaginative, but realistic tale. Cruelty and treachery and deceit are dramatic fiction staples, after all - Shakespeare, Dickens, Pasternak and Spillane would all have spent a lot more time down the pub whilst suffering from writer's block without them.

I must be careful not to blunder into a spoiler, but suffice to say that the deceit and treachery in this book are highly credible and well woven into a decent plot. Forbes makes us care about the central character and her developing nightmare. We care quite a lot, in fact, and we wish to find out how her torture ends; you'll gallop through the last two chapters.

We are in rural middle England, both socially and geographically. Make that upper-middle England. Borsetshire, roughly, as Birmingham is evidently within commuting distance. This rural idyll is very much Elizabeth Forbes' country and she knows whereof she writes. Her characters are believable, even ordinary. I could imagine Forbes herself as our central character and narrator in the opening act, though no salmon fishing, dice games or rat killing take place.

All rural communities get frightfully excited by new arrivals, and this one is no different. The attitude of the social circle to the arrival of Ellie is keenly observed. Most are rather feckless and gushing with their welcome, some reserved. We see this all the time in Idle-shire. First impressions, and our central character's observation of others' first impressions, are crucial to the first quarter of the book. If you are not impatient to keep reading by this stage, I fear you may not be the target audience here. An unconvincing take by the salmon, as we fishermen might put it.

Idle and the Idle girls, however, had swallowed the fly good and proper by this point. The pace of the book is excellent, the study of self-doubt compelling and the denouement.... well, get there and find out. All I will say is that someone got off pretty lightly.

Forbes' dialogue is easy and unforced. Every now and again something I detected as a Gilly Cooperism puts its head around the door, but disappears just as quickly. Perhaps I am oversensitive to girlie dialogue; perhaps we chaps are deaf to the language our memsahibs use when conversing among themselves, but Forbes' does have the ring of authenticity about it. There is a little sex and very limited shopping, but this book is emphatically not THAT sort of novel. It's a psychological thriller, a page-turner, a riveting example of how quickly one's sense of security and balance can be overturned.

It probably won't win the Booker, because it comes from a small publishing house and anyway your surname has to be Mantel to win the booker as a female writer (and the shortlist has just been announced). But I urge you to buy it and read it and encourage your friends to do likewise, even the ones whose boundaries are marked by Jeremy Clarkson and Catherine Cookson. 

Nearest Thing to Crazy? Pretty close, let's say.

On Second Thoughts

If Idle were the hon member for Goodwood and the Downs, as he clearly ought to be, he has no idea how he might have voted last night. Boy Assad is poisonous, just as Old Assad was, but there is something rather comforting about the fact that they are Shia Alawites who run a secular Ba’ath Arab autocracy in an overwhelmingly Sunni state, rather than religious nutters who would have us Europeans all dead or enslaved and a Caliphate in place. ‘Rather comforting’ may be the wrong expression, but you see what I mean.

Obama wanted the retaliation to the chemical atrocity to be ‘a shot across the bows’ of the Assad regime. What? Does he know what a shot across the bows means? It means a warning from which no one gets hurt. Where was he planning to lob his missile - into the ornamental lake in the presidential compound, injuring nothing except the prized collection of carp? I don’t think Obama knows what he is talking about, or what he wants to do. Maybe the story that Cameron has been lobbying Obama for months to get angry with Assad is true. Maybe Sam Cam’s visit to the refugee camp really did set this all rolling.

Cameron doesn’t know what the outcome of the Syrian civil war will be, nor has he expressed a preference, just that there should be no NBC weapons (it’ll take ‘em longer to kill each other with conventional stuff, but what the hell). Intervention will almost certainly not result 100% in the outcome desired by Downing Street and the White House, so the Law of Unintended Consequences will be unleashed (idle, in his 52 year span on earth, has discovered this law to be a bugger). Where is the British interest in all this? It is hard to fathom, though Cameron said he was clear in his own mind. He had reached his ‘judgement’ and he expected to have it supported by Parliament.

If we wondered what esteem Cameron is held in by his own party, let alone his coalition partners and Labour MPs, we now know.  Above all, last night’s vote established that the Prime Minister has neither the trust nor the confidence of the country to go wargaming on our behalf.

Mostly, this is Blair’s fault. His dishonesty and conceit will be remembered for as long as history books are written. Only ten years after his Big Lie, even strong prime ministers with working majorities (ie not Cameron) would have had difficulty winning a Commons vote on an issue as vague as Syria.

Cameron tried to square Miliband and thought he’d succeeded, but Miliband welshed on him, mostly for cynical reasons, but also because Miliband is another leader neither liked or respected by his MPs. Miliband is a strange creature – all earnestness and apparent honesty and bleeding-heart empathy, but with a fatal flaw in his character, which seems always to make him re-think after he has shaken hands, and to be dishonourable.

Well, the Ed Miller Band is one big step closer to Downing Street after Cameron’s folly of the past week, so we had better get used to the idea that this buck-toothed, goggle-eyed, camel-nosed Old Labour socialist is a probable, rather than possible winner of the next general election. Time to check that your passport isn’t about to expire.

Moving Day

Finally the house we wanted came on the market. It's a bit close to the town as you can see and is a flood risk, but one can't have everything. I'd love to have you all over for the weekend housewarming, but we're pushed for beds.

Idle is up to his ochsters in dust, boxes, spirit bottles less than a quarter full, ties he had forgotten about (some collectors' items from Hong Kong with appalling photographs on the inside of the wide bottom bit, as it were), and wardrobes full of clothes that he last managed to squeeze into a decade ago. Will any be thrown away? No. When the grim reaper starts clearing his throat I can see myself losing a few stone like my poor old Pater is suffering right now, and I want to avoid the mournful late-dotage look of a decrepit old gentleman in a collar four sizes too big for his shrunken neck. Same goes for kilt jackets, tennis shorts, lurid summer holiday trousers and cricket sweaters. I have unearthed a splendid collection of trouser braces that are a legacy of the 1980s City look. No, none of it will be binned; Lady Idle raises the eyebrow and curls the lip almost invisibly, but just enough to spell imminent danger and withdrawal of privileges. It is a risk that has to be run, however.

Three days after touchdown in the new gaff, we are off to the highlands to help them with their wildlife problem in the rivers and moors. Planned months ago, nothing one could do. Hurrah!

Enjoy the summer.

Courtside to Quality

I can't tell you how thrilling it was to be on Centre Court yesterday. The papers won't tell you this, for Andy Murray won a match at 9.30pm last night to reach the final, but before that, best player in the world narrowly defeated a huge, languid, talented, gutsy Argie called Del Potro, who charmed the crowd not just as underdog but as a great character with an ironic sense of humour. Idle has been lucky enough to get to Wimbledon most of the past twenty five years, and this was comfortably the highest-quality match he has seen. The sportsmanship was wonderful as well.

The serving was brutal and consistent - just seven double faults in 57 games, the return of serve astonishing, and the groundstrokes - well, I've never seen the ball hit so hard, so consistently, long rallies so breathtaking. Every now and again Del Boy, as some of the crowd insisted on calling him, unleashed what my host and I started calling his 'bazooka' - a forehand of extraordinary power, always crosscourt, barely clearing the net. Djokovic only once got his racket to it, which was an edge, taken at deep third man by a spectator in Row Z. The synchronised gasp and applause of 15,000 people when he did this, three or four times a set, was memorable.

This was TOP sport. Djokovic deserved his narrow victory. Del Potro deserved his own standing ovation. He will be a very popular man at Wimbledon for as long as he keeps coming here.

Filthy Lucre and the Greasy Pole

A gathering of honest MPs at Westminster

Like the old tale of the man who asked an Irishman for directions and was told ‘well, yer wouldn’t wanta be startin from here’, I suspect the answer to the question ‘should MPs be paid more’ is, ‘yes, but not THESE MPs’.

In other words, we want a much higher calibre of MP and we’d be prepared to pay enough to attract him or her. But much of the current lot deserve to be banged up for fraud rather than paid more.

There is a solution – fewer MPs, equal sized constituencies and open primaries. Make every single one of them go through a gruelling local selection by open primary. Allow no party placement or union sponsorship.

As in many other areas, Dan Hannan is clear and succinct:

http://blogs.telegraph.co.uk/news/danielhannan/100005603/open-primaries-will-eventually-become-the-norm/

http://blogs.telegraph.co.uk/news/danielhannan/5680487/You_want_a_British_Obama_Try_open_primaries/