Lawson: Tories argue that black is white.

The Tories and their supportive press are hailing Nigel Lawson, who was Chancellor of the Exchequer under Margaret Thatcher, as an heroic figure whose economic policies rescued Britain from being an overtaxed, overregulated, bloated state into a roaring economic success. It is true that Lawson was a conviction politician who overturned the Keynesian policies which had become conventional in the post war period into what became known as the Washington Consensus of small states, low taxation, privatisation and deregulation. This he believed would lead to dynamic prosperity. Unfortunately, as we are now experiencing, his convictions were wrong. On taxation he was much applauded for cutting the basic rate of income tax to 25% (sic). He set the trend and it is now 20%. He managed to pay for this by increasing the levels of VAT: fine, but regressive in that it impinges on the poor rather than the wealthy and contributes to the present-day unacceptable and dysfunctional levels of poverty and inequality. Yes, there is plenty of room for taxation reform, but by switching from taxing desirable and productive activities (eg employment) to taxing undesirables (eg pollution, excess profits, rising house prices, land hoarding, short-term financial transactions). Another source of finance for his tax-cutting gamble was the sale of public assets - privatisation (gas, electricity, water, the railways, social housing etc.). These provided a “one off” boost to the treasury but have left us with utilities owned not by our government but foreign ones, hedge funds, and buy- to- let landlords. all capable of reaping excess profits for their own rather than our pockets. The deregulation and inadequate supervision of that which remained led to the 2008/9 banking crash and the current pollution of our rivers with sewage, to name but two. Our smaller state means that we have an impoverished education system, the highest level of child poverty for generations, a health service on its knees, a totally inadequate care service, prisons overcrowded, courts with a two-year backlog, endemic homelessness and a transport system not fit for purpose. As for the dynamism that was supposed to be unleashed - well , the 1% at the top have done very nicely, but largely through the ries inpropety prices short-term financial manipulation rather than innovative investment. For the rest of us, we have the lowest growth-rate in the G7 and, in terms of income per head, Poland will overtake us by the end of the decade.