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politicalbetting.com » Blog Archive » Ed Balls makes the 50 percent tax-rate the GE2015 dividing

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  • DavidLDavidL Posts: 54,020
    AveryLP said:

    DavidL said:

    AveryLP said:

    DavidL said:

    AveryLP said:

    Neil said:

    AveryLP said:


    Until then the interim report's conclusions will have to stand.

    I.
    ...

    His final conclusion is almost written in Irish English:

    As a result, the upward revision to wages and salaries falls to around £8 billion by 2017-18.

    ...

    My point was that the figures upon which the government is claiming that real pay rose are distorted by the adjustments made to actual earnings as a result of the change in the tax rate. This means that the gross income on which they are basing their figures is distorted by these deferred bonuses and the average increase is therefore said to be higher than it was for the vast majority of the population. The government has then used this average figure to be set against the significant tax cuts enjoyed by the lower paid and, hey presto, we have a real terms increase.

    In fact we don't. We have a small number of higher earners who received a significant amount of deferred bonuses (as shown in your Chote quote) and the majority whose earnings were growing much more slowly than the overall average. It amazes me that Labour do not seem to have been numerate enough to point this out. It does not bode well for the likely next government.
    I have tried to find the statistics upon which the Government (Cameron in Davos?) is making the claim that Real Household Disposable Income is rising.

    I am beginning to suspect that they are not new stats but more a recent analysis of old stats: particularly the RHDI stats released by the ONS in their annual economic reviews.

    There will have been a distortion in disposable income between the first and second quarter of the 2013 calendar year caused by deferral of bonuses and income into the new fiscal year, but this distortion would be averaged out by looking at trends across a couple of years.

    Do you have a source for the 'Treasury Analysis' from which the press states the Tory claims are derived?

    No. The BBC has this: http://www.bbc.co.uk/news/business-25878173
    But this does not mention the distortion in earnings either.
  • JonathanJonathan Posts: 21,705
    Interesting reaction to the 50p announcement. Can't see why this is such a big deal. The jump from 45p to 50p for salaries over £150k, just doesn't seem like a huge leap. If it were 75p then maybe.The number of people it impacts is minuscule. The symbolic value will win and lose a few votes in equal measure.

    It is nether the end nor the beginning of the world.
  • Scott_PScott_P Posts: 51,453

    In order to demonstrate that people will recoil in horror, Scott P quotes the Institute of Directors three times :-).

    It merely demonstrates that the business community that Blair/Brown courted so assiduously (prawn cocktail anyone?) have not just been abandoned, but actively scorned by Miliband/Balls

    It's a 'brave' strategy, but if it keeps the morale of the troops up, why not?
  • MarkSeniorMarkSenior Posts: 4,699
    Charles said:

    Charles said:

    Socrates said:

    Why doesn't Balls go for the 75% top rate that has done such wonders for France?

    Because the 50% is likely to the left of the Laffer curve while the 75% is likely to the right?
    For the record, the 75% doesn't apply to individuals I believe, although I'm not entirely clued in on how they sorted it in the end.
    Companies that pay wages at that level (E1m?) have to pay an extra social charge.

    Even more impressive: I was chatting to a friend of mine a couple of weeks ago. He got a letter at the end of November from the French government (he lives in Paris).

    Essentially said:

    - You have been assessed as 1 of 3,000 people in France who being asked to make a voluntary contribution to the Treasury
    - You will be informed about the level of this contribution within the next 10 days.
    - If you do not make this contribution within 10 days following this letter, it will be deemed to be a criminal action on your part

    Ah , so your friend is one of those suspected of evading tax via untaxed accounts held abroad . Such tax evaders are being offered a partial amnesty and lower penalty rates if they voluntarily cough up what they owe .
    No - he lives and works in France and pays tax there. But is in the process of moving back to the UK. There is a UK based family trust, but that was in existence before he moved to France.
    I am not saying that your friend is evading tax only that the French IR seem to think he may be and are offering him a partial amnesty for making a voluntary payment .
  • Danny565Danny565 Posts: 8,091
    About time Labour made a commitment to bring back the 50p rate. No matter what the media delusionally think (and the "PBTories", god bless you all), most people's reactions would be that's not high enough. There is immense anger out there at the idea that an elite of business-men think it's OK to rip the rest of us off, and threaten to hold us to ransom or to leave the country when we say we want more money from them. Squeals of horror from the super-wealthy, who most people hold responsible for the mess and to be incredibly selfish for being unwilling to take their share of the burden these past few years, will just make such a pledge more popular.

    That said, I'm still worried about Balls's completely unnecessary "surplus" pledge. I wish Labour would realise how, in the real world, how little people care about or even really understand the deficit and public finances in general. The reason the general idea of "the country's on the brink of bankruptcy" had such currency for a while is because the news was filled with stories of European countries in dire straits; now that's over, people genuinely think the problem is solved, no matter what the official figures might say, and people genuinely don't believe there is any need for further cuts now that there's no problem anymore. So Balls' pledge unnecessarily pushes an issue, which Labour will always lose on, back to the top of the agenda, when otherwise the public was starting to disregard it. It is a typical Gordon Brown tactic, designed to bamboozle the Westminster pundits for a day without any regard for the huge problems it will create further down the road.
  • AveryLPAveryLP Posts: 7,815
    edited January 2014
    DavidL said:

    AveryLP said:

    DavidL said:

    AveryLP said:

    DavidL said:

    AveryLP said:

    Neil said:

    AveryLP said:


    Until then the interim report's conclusions will have to stand.

    I.
    ...

    His final conclusion is almost written in Irish English:

    As a result, the upward revision to wages and salaries falls to around £8 billion by 2017-18.

    ...

    My point was that the figures upon which the government is claiming that real pay rose are distorted by the adjustments made to actual earnings as a result of the change in the tax rate. This means that the gross income on which they are basing their figures is distorted by these deferred bonuses and the average increase is therefore said to be higher than it was for the vast majority of the population. The government has then used this average figure to be set against the significant tax cuts enjoyed by the lower paid and, hey presto, we have a real terms increase.

    In fact we don't. We have a small number of higher earners who received a significant amount of deferred bonuses (as shown in your Chote quote) and the majority whose earnings were growing much more slowly than the overall average. It amazes me that Labour do not seem to have been numerate enough to point this out. It does not bode well for the likely next government.
    I have tried to find the statistics upon which the Government (Cameron in Davos?) is making the claim that Real Household Disposable Income is rising.

    I am beginning to suspect that they are not new stats but more a recent analysis of old stats: particularly the RHDI stats released by the ONS in their annual economic reviews.

    There will have been a distortion in disposable income between the first and second quarter of the 2013 calendar year caused by deferral of bonuses and income into the new fiscal year, but this distortion would be averaged out by looking at trends across a couple of years.

    Do you have a source for the 'Treasury Analysis' from which the press states the Tory claims are derived?

    No. The BBC has this: http://www.bbc.co.uk/news/business-25878173
    But this does not mention the distortion in earnings either.
    Best press coverage yet on the spat.

    I have had the ASHE report open in my browser for a couple of days but it far from addresses the question in dispute up front and there is probably a derivative analysis around.

    Still Labour are fighting a losing battle on this as the trends are all pointing to a cross-over having already happened and the positive gap widening during this year.

    Provided of course the current rates of growth can be maintained.

  • CharlesCharles Posts: 35,758

    Charles said:

    Charles said:

    Socrates said:

    Why doesn't Balls go for the 75% top rate that has done such wonders for France?

    Because the 50% is likely to the left of the Laffer curve while the 75% is likely to the right?
    For the record, the 75% doesn't apply to individuals I believe, although I'm not entirely clued in on how they sorted it in the end.
    Companies that pay wages at that level (E1m?) have to pay an extra social charge.

    Even more impressive: I was chatting to a friend of mine a couple of weeks ago. He got a letter at the end of November from the French government (he lives in Paris).

    Essentially said:

    - You have been assessed as 1 of 3,000 people in France who being asked to make a voluntary contribution to the Treasury
    - You will be informed about the level of this contribution within the next 10 days.
    - If you do not make this contribution within 10 days following this letter, it will be deemed to be a criminal action on your part

    Ah , so your friend is one of those suspected of evading tax via untaxed accounts held abroad . Such tax evaders are being offered a partial amnesty and lower penalty rates if they voluntarily cough up what they owe .
    No - he lives and works in France and pays tax there. But is in the process of moving back to the UK. There is a UK based family trust, but that was in existence before he moved to France.
    I am not saying that your friend is evading tax only that the French IR seem to think he may be and are offering him a partial amnesty for making a voluntary payment .
    They sent them to all partners in French based private equity firms
  • MrJonesMrJones Posts: 3,523
    Emerging markets

    Globalization is/was a robbery and this is the inevitable result. The banksters and their bought politicians looted as much industrial capital as they could from Europe and America and shipped it abroad. That's all it was/is.

    This could only work *temporarily* because long-term you can't have 90% industrial capacity in one place and 90% demand in another place. There's no means to pay for it. It could only work while western *credit* lasted. So for 30-ish years the banksters had a sweet thing going where they paid eastern wages, sold at western prices and paid their tax in Monaco but that's it - now it's falling apart as it inevitably would.

    The banksters have completely screwed the world economy. Again.

    The analogy won't be exact obviously but assuming for the sake of argument that 2008 is this time's equivalent of 1929 but things are falling at half speed due to Bernanke's brakes we'd be around the equivalent of 1931-1932 now - at the Japanese in Manchuria, Italians in Ethiopia type of stage (not necessarily in Europe of course e.g. Arab Spring), coming up to this time's equivalent of the Spanish Civil War (also not necessarily in Europe.
  • Scott_PScott_P Posts: 51,453
    @JohnRentoul: Another Fine Photoshop RT @GeneralBoles @hopisen I am waiting to hear back from CCHQ re this piece - http://t.co/oJehed5ihH
  • AndyJSAndyJS Posts: 29,395
    edited January 2014
    IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K.
  • john_zimsjohn_zims Posts: 3,399
    edited January 2014
    @Jonathan

    'It is nether the end nor the beginning of the world.'

    Agree, we need to be told how much other taxes will be increased,last time round NI was significantly increased instead of income tax & council tax more than doubled under New Labour.
  • isamisam Posts: 41,118
    @MikeSmithson

    This is debated almost daily on here... worth a thread?

    Old thinking vs New thinking

    http://www.huffingtonpost.co.uk/2014/01/24/ukip_1_n_4657394.html
  • JosiasJessopJosiasJessop Posts: 43,469
    Hugh said:

    Scott_P said:

    @IainDey: Some of the words used by senior business people to describe @edballsmp plan to reinstate 50p tax on high earners cannot be printed.

    Excellent.
    Why is it excellent to upset the people who employ millions in this country, and contribute massively as well?

    It's an odd thing to feel 'excellent' about.
  • AveryLPAveryLP Posts: 7,815
    edited January 2014
    Danny565 said:


    ...

    I'm still worried about Balls's completely unnecessary "surplus" pledge. I wish Labour would realise how, in the real world, how little people care about or even really understand the deficit and public finances in general. The reason the general idea of "the country's on the brink of bankruptcy" had such currency for a while is because the news was filled with stories of European countries in dire straits; now that's over, people genuinely think the problem is solved, no matter what the official figures might say, and people genuinely don't believe there is any need for further cuts now that there's no problem anymore. So Balls' pledge unnecessarily pushes an issue, which Labour will always lose on, back to the top of the agenda, when otherwise the public was starting to disregard it. It is a typical Gordon Brown tactic, designed to bamboozle the Westminster pundits for a day without any regard for the huge problems it will create further down the road.


    Thanks to the mess made of the public finances by Labour during their thirteen years of fiscal folly, the cost of servicing UK public debt already incurred is currently forecast to be around £77 bn in 2017/18. This amount is over 10% of total managed government expenditure forecast for the same year and will account for a third of social expenditure. It exceeds defence and education expenditure combined.

    The interest rate charged on the debt is based on a government pursuing a sound fiscal strategy with firm plans to eliminate the structural deficit with a five year forward period and to generate surpluses which reduce debt thereafter.

    If the markets begin to suspect that a future UK government intends to abandon the current deficit and debt reduction plans the inevitable consequence will be a rise in the interest rates charged to the UK to borrow from the international markets. And that means the £77 bn a year debt interest costs rapidly increasing.

    Balls's surplus pledge is therefore absolutely critical to avoiding market panic and to preventing Labour economic management policy becoming dismissable on that ground alone.

    Now we might not believe Balls is serious about deficit and debt reduction (he was after all Brown's chief economic advisor), but to admit he is not serious in public would be political suicide both for him personally and his party..
  • PulpstarPulpstar Posts: 78,410
    edited January 2014
    Time to see if Big Buck's still has it !

    Good quality field at any rate to check.
  • AndyJSAndyJS Posts: 29,395
    edited January 2014
    Simply put, globalisation has succeeded in making us all richer in absolute terms, but we don't feel happy because it has also created a class of super-rich people who live in a different stratosphere, so we feel worse-off relatively speaking in comparison to them.
  • isamisam Posts: 41,118
    A Labour blogger tweets..

    Emma Burnell ‏@EmmaBurnell_ 7m

    When a young black woman tells us Farage is a breath of fresh air, heckling her shows why our refusal to listen is the problem. #Fab14
  • HurstLlamaHurstLlama Posts: 9,098
    "About time Labour made a commitment to bring back the 50p rate. No matter what the media delusionally think (and the "PBTories", god bless you all), most people's reactions would be that's not high enough"

    Absolutely, Danny, at one stage not that long ago we had a top tax rate of 19s 6d per £. That was, of course, when we had a government who really knew what they were doing. We should go back to those sorts of rates, maybe bang up the 40% to 50% (people on more than £32k p.a. can easily afford to shoulder a fairer share) and then put in some more progressive tax bands thereafter, say 60% on income over £50k, 70% on income over £80K and so on until we get to magic number of 97.5%. That will teach the rich a thing or two, of course we might need an exit tax and we should set that at 97.5%.

    Going back to the tax rates of the forties might also mean we need to re-introduce some other ideas that were prevalent then. Strict food & fuel rationing for a start and, of course, capital controls. We could also get back to a proper planned political economy where the resources needed to run a business (including people) are allocated by the state. It all worked so well I can't imagine why we moved away from it, must have been down to those wicked Tories looking after their rich chums.
  • PulpstarPulpstar Posts: 78,410
    edited January 2014
    :( Annie Power nailed on imo if she goes in the world hurdle
  • MrJonesMrJones Posts: 3,523
    China

    What's gonna happen in China (same as Japan in the 90s) and why it illustrates one of the flaws in the western banking model (and also how it doesn't matter who's running the flawed model whether corporate gangsters, kieretsu or a commie state.)

    1. Bank lending can be either:
    a) worthwhile investment
    b) worthless investment (asset bubbles and consumer lending)

    2. With fractional reserve bankstering the amount of lending is decided by:
    savings x capital ratio

    ergo the problem is there's no link between the capital ratio and the ratio of worthwhile to worthless investment

    Example
    A country has ten million savings and a capital ratio of 10 = 100 million to lend, so far so good, but what if there's only 40 million of worthwhile investment? The other 60 goes into worthless investment.

    The capital ratio needs to be a throttle but isn't and if the capital ratio is too high you'll get endless boom and bust cycles.

    The actual throttle value needs to relate to whatever you think determines the ratio of worthwhile to worthless investment. I think it's the rate of innovation so the capital ratio should go up and down based on: (low) default churn level + current rate of innovation.

    Say the default capital ratio was 4
    -someone invents the steam engine so the ratio goes up to 10 while it's being rolled out and then drops back to 4 again
    -someone invents the IC engine so the ratio goes up to 10 while it's being rolled out and then drops back to 4 again
    -someone invents the fusion power so the ratio goes up to 10 while it's being rolled out and then drops back to 4 again
    etc

    (I think the reason the default capital ratio in the western model is too high is because what is seen as the "normal" level comes out of a period of extremely high innovation in Europe.)

    #

    China and Japan

    Countries that are modernizing have an effectively unlimited amount of worthwhile investment. As they near the end of that process the worthwhile investment tapers off and they need to throttle back their capital ratio. If they don't do that a tidal wave of previously worthwhile lending will go into asset bubbles or consumer lending instead. This is what happened in Japan in the 90s imo and seems like it might be happening in China now.

    What's interesting about the Chinese example is even though their bankstering is state run because it's following the flawed western model it's doing the same things except because they're commies their version of a property asset bubble is building empty cities in the desert.

    TL;DR

    boobs
  • EasterrossEasterross Posts: 1,915
    Afternoon all, it would be interesting to see the response of the public if YouGov asked the following question: "If a future Labour government promised to increase the top income tax rate to 50p and this led to the owners of the business you work for closing it down and taking the work abroad, would you support the proposal?" We saw how quickly the "comrades" at Grangemouth did a U-turn when it turned out their union masters were talking through their heads and their employers proved they weren't making idle threats.

    Has Balls learned nothing from his hero Hollande's mess in France.
  • Sean_FSean_F Posts: 37,538

    "About time Labour made a commitment to bring back the 50p rate. No matter what the media delusionally think (and the "PBTories", god bless you all), most people's reactions would be that's not high enough"

    Absolutely, Danny, at one stage not that long ago we had a top tax rate of 19s 6d per £. That was, of course, when we had a government who really knew what they were doing. We should go back to those sorts of rates, maybe bang up the 40% to 50% (people on more than £32k p.a. can easily afford to shoulder a fairer share) and then put in some more progressive tax bands thereafter, say 60% on income over £50k, 70% on income over £80K and so on until we get to magic number of 97.5%. That will teach the rich a thing or two, of course we might need an exit tax and we should set that at 97.5%.

    Going back to the tax rates of the forties might also mean we need to re-introduce some other ideas that were prevalent then. Strict food & fuel rationing for a start and, of course, capital controls. We could also get back to a proper planned political economy where the resources needed to run a business (including people) are allocated by the state. It all worked so well I can't imagine why we moved away from it, must have been down to those wicked Tories looking after their rich chums.

    Oddly enough, Attlee's government was a low tax/low spend government by modern standards. Marginal tax rates were enormous, but a married man had to earn twice the average income before he paid income tax, and there was no VAT.
  • Casino_RoyaleCasino_Royale Posts: 60,701
    I'm annoyed, but not surprised, that Labour have announced this. Their "trap" worked perfectly in destroying the Tories poll lead in 2012. Why on earth wouldn't they reset it?

    Notwithstanding the fixed-term parliament act, a vote of no confidence could bring down an unstable Labour (minority) government within 18 months. Just enough time to pass a budget to re-set the trap before (potentially) the Tories take over again.
  • MrJonesMrJones Posts: 3,523
    AndyJS said:

    Simply put, globalisation has succeeded in making us all richer in absolute terms, but we don't feel happy because it has also created a class of super-rich people who live in a different stratosphere, so we feel worse-off relatively speaking in comparison to them.

    90% supply in one place and 90% demand in another place cannot work long-term. It could only last until the credit ran out.
  • rcs1000rcs1000 Posts: 57,624
    MrJones said:

    AndyJS said:

    Simply put, globalisation has succeeded in making us all richer in absolute terms, but we don't feel happy because it has also created a class of super-rich people who live in a different stratosphere, so we feel worse-off relatively speaking in comparison to them.

    90% supply in one place and 90% demand in another place cannot work long-term. It could only last until the credit ran out.
    What is credit, MrJones?
  • Someone mentioned that Labour's 10p tax rate would make people currently not paying tax start doing so again.

    Or perhaps 10p is what you pay after your tax free allowance, thus cutting bills even further? Yes, I'm sure that's right.....

    Anyway compare and contrast. Labour propose cutting tax for the low paid - unaffordable say the Tories. But we can afford to keep taxes lower for the fabulously paid say the Tories. I'm not sure the Tories can simultaneously resist tax cuts for the poor and tax increases for the rich and get away with a message that they understand normal people and their views on life. For all that some insist Oik is some great political tactician and Balls not, it does seem to be Ed(s?) setting the traps not the other way round.
  • OldKingColeOldKingCole Posts: 33,711
    edited January 2014
    Before VAT there was Purchase Tax, which could be as high as 100%, IIRC. That was of course on the wholesale value of the goods. It was only on goods, of course, not services.
  • This is a smart political move by Balls, if a shitty economic one. Labour are on course to win and have a real bash at true lefty spending once again.

    The economic downside can be almost eliminated if the 50p rate band only kicks in a high level (6 figure salaries). That would yield all of the electoral gain but not too much revenue loss.
  • GeoffMGeoffM Posts: 6,071
    The unspoken alternative to all of this extra taxation is of course for the govt not to spend like a drunken sailor.

    Tax cuts, spending cuts (real ones, not the current pretendy stuff) and money in your pocket. What's not to like (unless you want your tattoos removed by the NHS)
  • PulpstarPulpstar Posts: 78,410
    @isam Can't believe it - THE shock of the season is potentially on at the Etihad and I can't find it on any sports channel whatsoever
  • Afternoon all, it would be interesting to see the response of the public if YouGov asked the following question: "If a future Labour government promised to increase the top income tax rate to 50p and this led to the owners of the business you work for closing it down and taking the work abroad, would you support the proposal?" We saw how quickly the "comrades" at Grangemouth did a U-turn when it turned out their union masters were talking through their heads and their employers proved they weren't making idle threats.

    Compare and contrast the two sides of your question:
    1. Unions fighting to increase wages and protect working conditions for normal people. Awful union bully boys throwing their weight around making threats to disrupt a business. They should be ignored.
    2. Top executives whose salaries have exploded to a hundred times their average worker's salary threaten to close the entire business and sack everyone (apart from themselves) in protest at having to pay slightly more tax. Captains of business, sensible chaps whose actions should be applauded.

    And you wonder why people are sick of the status quo....

  • glwglw Posts: 9,955

    Someone mentioned that Labour's 10p tax rate would make people currently not paying tax start doing so again.

    Or perhaps 10p is what you pay after your tax free allowance, thus cutting bills even further? Yes, I'm sure that's right.....

    Anyway compare and contrast. Labour propose cutting tax for the low paid - unaffordable say the Tories. But we can afford to keep taxes lower for the fabulously paid say the Tories. I'm not sure the Tories can simultaneously resist tax cuts for the poor and tax increases for the rich and get away with a message that they understand normal people and their views on life. For all that some insist Oik is some great political tactician and Balls not, it does seem to be Ed(s?) setting the traps not the other way round.

    You are almost certainly wrong, as unless the 10p band was almost negligible it would cost far more than the rise from 45p to 50p to would raise (assuming it even raises anything). You'd be giving almost every tax payer in the country quite a large tax cut.

    My guess is that the 10p band will have some major caveats.
  • glw said:

    Someone mentioned that Labour's 10p tax rate would make people currently not paying tax start doing so again.

    Or perhaps 10p is what you pay after your tax free allowance, thus cutting bills even further? Yes, I'm sure that's right.....

    Anyway compare and contrast. Labour propose cutting tax for the low paid - unaffordable say the Tories. But we can afford to keep taxes lower for the fabulously paid say the Tories. I'm not sure the Tories can simultaneously resist tax cuts for the poor and tax increases for the rich and get away with a message that they understand normal people and their views on life. For all that some insist Oik is some great political tactician and Balls not, it does seem to be Ed(s?) setting the traps not the other way round.

    You are almost certainly wrong, as unless the 10p band was almost negligible it would cost far more than the rise from 45p to 50p to would raise (assuming it even raises anything). You'd be giving almost every tax payer in the country quite a large tax cut.

    My guess is that the 10p band will have some major caveats.
    You're confusing politics with economics. The Balls 10p/50p combo is excellent politics. That it will almost certainly reduce the tax take is neither here nor there for lefty voters. Never forget - there are plenty of votes in ruining a country.
  • weejonnieweejonnie Posts: 3,820
    "IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K. "

    I assume you earn 60K?
  • MikeSmithsonMikeSmithson Posts: 7,382
    Pulpstar said:

    @isam Can't believe it - THE shock of the season is potentially on at the Etihad and I can't find it on any sports channel whatsoever


    Down load the CrowdsScores app for the latest and fastest info. This is my son's creation and it's miles faster with the news


  • isamisam Posts: 41,118
    Pulpstar said:

    @isam Can't believe it - THE shock of the season is potentially on at the Etihad and I can't find it on any sports channel whatsoever

    Yeah! I got knocked back for Aguero HT at 12s...
  • MrJonesMrJones Posts: 3,523
    rcs1000 said:

    MrJones said:

    AndyJS said:

    Simply put, globalisation has succeeded in making us all richer in absolute terms, but we don't feel happy because it has also created a class of super-rich people who live in a different stratosphere, so we feel worse-off relatively speaking in comparison to them.

    90% supply in one place and 90% demand in another place cannot work long-term. It could only last until the credit ran out.
    What is credit, MrJones?
    In this context it's the confidence of the new producers in their customer's ability to repay based on those customer's historical ability to repay - but not taking into account their historical ability to repay was based on the industrial capital that is being looted and transferred. Once that sinks in and confidence in ability to repay declines then either the new producers switch to domestic demand very fast or the whole system collapses.

    50/50 i'd say.
  • rcs1000rcs1000 Posts: 57,624

    Afternoon all, it would be interesting to see the response of the public if YouGov asked the following question: "If a future Labour government promised to increase the top income tax rate to 50p and this led to the owners of the business you work for closing it down and taking the work abroad, would you support the proposal?" We saw how quickly the "comrades" at Grangemouth did a U-turn when it turned out their union masters were talking through their heads and their employers proved they weren't making idle threats.

    Compare and contrast the two sides of your question:
    1. Unions fighting to increase wages and protect working conditions for normal people. Awful union bully boys throwing their weight around making threats to disrupt a business. They should be ignored.
    2. Top executives whose salaries have exploded to a hundred times their average worker's salary threaten to close the entire business and sack everyone (apart from themselves) in protest at having to pay slightly more tax. Captains of business, sensible chaps whose actions should be applauded.

    And you wonder why people are sick of the status quo....

    Work has gone off-shore, because people, ordinary people, chose to buy cheaper products from abroad.

    When you bought your car, did you make sure it was made in the UK? Or were you happy to feather the nest of the international capitalist in order to save a few quid?

    What about when you bought your mobile phone?
  • PulpstarPulpstar Posts: 78,410

    Pulpstar said:

    @isam Can't believe it - THE shock of the season is potentially on at the Etihad and I can't find it on any sports channel whatsoever


    Down load the CrowdsScores app for the latest and fastest info. This is my son's creation and it's miles faster with the news


    Listening to it on iplayer. Just surprised that it isn't televised anywhere.
  • Casino_RoyaleCasino_Royale Posts: 60,701
    isam said:
    One does wonder if a political party could be created that Peter Hitchens could ever bring himself to support. Unless he set it up and ran it. Even then I'm not sure.
  • MrJonesMrJones Posts: 3,523
    Support for punitive taxes on the rich is proportional to how much people think the rich actually pay i.e. if they think they only actually pay half then to them 50% is only really 25%.

    So could be an interesting Ukip gamble here: something like 40% should be the maximum on general principle but at the same time more enforcement on making sure rich people like BBC wallahs can't fiddle it.

    Bit of a gamble in the current climate admittedly.
  • GeoffMGeoffM Posts: 6,071
    edited January 2014
    weejonnie said:

    "IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K. "

    I assume you earn 60K?

    That's the way it is. The "rich" are people who are better off than me.
    Whether or not they've worked harder than me, they must subsidise me because that's fair.
    I shouldn't pay more for lazy people with less than me.
    Why should I? That's not fair.

  • Casino_RoyaleCasino_Royale Posts: 60,701
    weejonnie said:

    "IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K. "

    I assume you earn 60K?

    I long for a time when the debate focuses on what core services the government needs to provide, and in what form, and then how much money would be necessary for that - leading to the government making its case for taxation to match it accordingly.

    The one at the moment seems to focus on how much money can be credibly and sustainably wrung out of taxpayers (at whatever level) It depresses me.
  • taffystaffys Posts: 9,753
    edited January 2014
    People won't care about what the rich get if they start to feel better off themselves. It's the tories' task to make them feel better.
  • PulpstarPulpstar Posts: 78,410
    Someone better check on Ave it.
  • MikeLMikeL Posts: 7,723
    tpfkar said:

    Smart politics but I thought they'd announced it ages ago. It does put the LDs in a spot as their party conference voted - just- to keep the 45p rate. I imagine this would be an easy concession in a Lib/Lab discussion.

    As Paul_mid_Beds says the more radical step would have been to go for the mansion / land value tax, instead of just reversing back to the status quo on an issue it's known the parties disagree on.

    Lab policy is to introduce a Mansion Tax as well as reverting to the 50p rate.
  • taffystaffys Posts: 9,753
    ConHome is quite clever on the 50p tax.

    How are labour going to fund it?
  • PulpstarPulpstar Posts: 78,410
    taffys said:

    ConHome is quite clever on the 50p tax.

    How are labour going to fund it?

    Tax neutral isn't it ?
  • PulpstarPulpstar Posts: 78,410
    @taffys I've heard it will both raise and lower revenue.. so I'm inclined to think it won't make much difference.
  • fitalassfitalass Posts: 4,320
    "A challenge for the Tories is that whilst there maybe an argument that lowering tax rates increases the overall tax take this is a hard one to get across. It is hard to see political slogans based on the “Laffer curve” resonating."

    One poster showing that the last Labour Government took away the 10p tax from the lowest earners before they increased the top rate of income for 57 days. And while comparing this Government removing the lowest earners out of taxation altogether while consistently taxing the top rate of earners more than Labour ever did over the whole term of this Parliament.
  • GeoffMGeoffM Posts: 6,071

    weejonnie said:

    "IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K. "

    I assume you earn 60K?

    I long for a time when the debate focuses on what core services the government needs to provide, and in what form, and then how much money would be necessary for that - leading to the government making its case for taxation to match it accordingly.

    The one at the moment seems to focus on how much money can be credibly and sustainably wrung out of taxpayers (at whatever level) It depresses me.
    Exactly. Very well put.

  • volcanopetevolcanopete Posts: 2,078
    Government defeat no 88.Any odds on them reaching the century before stumps are drawn?

    http://www.theguardian.com/law/2014/jan/23/nuisance-and-annoyance-injunctions-abandoned-lords-defeat
  • EasterrossEasterross Posts: 1,915
    Ed Balls @edbaIIs_mp
    It was a Labour government who stopped the boom and bust cycle. You can trust us to balance the books. #fab14

    Utterly unbelieveable!
  • GIN1138GIN1138 Posts: 22,380
    Conservative's should respond by giving an "aspiration" to lower the 45p rate back to 40p.

    They should then hammer the point that lower tax rate's actually bring in more money!

    People then have a choice between effective economic management with the Tories/coalition or spiraling off to the Left with The Ed's.

    At least folk will have a choice in 2015 between two very different visions - Will be a fun election.
  • MrJonesMrJones Posts: 3,523

    Ed Balls @edbaIIs_mp
    It was a Labour government who stopped the boom and bust cycle. You can trust us to balance the books. #fab14

    Utterly unbelieveable!

    That must be a spoof account?
  • GeoffM said:

    weejonnie said:

    "IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K. "

    I assume you earn 60K?

    I long for a time when the debate focuses on what core services the government needs to provide, and in what form, and then how much money would be necessary for that - leading to the government making its case for taxation to match it accordingly.

    The one at the moment seems to focus on how much money can be credibly and sustainably wrung out of taxpayers (at whatever level) It depresses me.
    Exactly. Very well put.

    Yep agree 100%
  • HurstLlamaHurstLlama Posts: 9,098

    weejonnie said:

    "IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K. "

    I assume you earn 60K?

    I long for a time when the debate focuses on what core services the government needs to provide, and in what form, and then how much money would be necessary for that - leading to the government making its case for taxation to match it accordingly.

    The one at the moment seems to focus on how much money can be credibly and sustainably wrung out of taxpayers (at whatever level) It depresses me.
    Mr. Royale,

    You will go to the bad fire if you believe that the sole purpose of tax is, or even should be, to raise the money HMG needs to provide essential services for the subjects of HMtQ.
  • PulpstarPulpstar Posts: 78,410
    MrJones said:

    Ed Balls @edbaIIs_mp
    It was a Labour government who stopped the boom and bust cycle. You can trust us to balance the books. #fab14

    Utterly unbelieveable!

    That must be a spoof account?
    Labour will balance the books and get the deficit down in a fairer way - here's my full #fab14 speech:

    seems to be the real tweet
  • MonikerDiCanioMonikerDiCanio Posts: 5,792
    edited January 2014
    MrJones said:

    Ed Balls @edbaIIs_mp
    It was a Labour government who stopped the boom and bust cycle. You can trust us to balance the books. #fab14

    Utterly unbelieveable!

    That must be a spoof account?
    Balls seems to have gone rogue. Has EdM endorsed any of these wild outbursts?

  • QuincelQuincel Posts: 4,042
    Sounds like a less artful version of @IDS_MP to me. The '_MP' in both cases makes it particularly suspect, and the fact that @EdBallsMP is a verified account.
  • QuincelQuincel Posts: 4,042
    The 'Labour will balance the books' is genuine, but not nearly as crazy.
  • Casino_RoyaleCasino_Royale Posts: 60,701

    GeoffM said:

    weejonnie said:

    "IMO 50% is okay as long as it hits those on more than about 75K a year, and not what I would regard as ordinary middle-class people, which is around 30-50K. "

    I assume you earn 60K?

    I long for a time when the debate focuses on what core services the government needs to provide, and in what form, and then how much money would be necessary for that - leading to the government making its case for taxation to match it accordingly.

    The one at the moment seems to focus on how much money can be credibly and sustainably wrung out of taxpayers (at whatever level) It depresses me.
    Exactly. Very well put.

    Yep agree 100%
    Thanks.

    @HurstLlama - I feel like I've been there for years already.
  • EasterrossEasterross Posts: 1,915
    MrJones said:

    Ed Balls @edbaIIs_mp
    It was a Labour government who stopped the boom and bust cycle. You can trust us to balance the books. #fab14

    Utterly unbelieveable!

    That must be a spoof account?
    No his official twitter account which I follow from time to time. One of several fantasy tweets he has put out today and no doubt will be lionised by the Observer and other leftie Sunday papers.
  • Morris_DancerMorris_Dancer Posts: 61,963
    Hmm. I saw that Ed Balls tweet. Spoof was the first word that came to mind.

    Probably more accurate and honest than the real account, though.
  • EasterrossEasterross Posts: 1,915
    Another mass shooting currently taking place in the NE USA. 3 dead so far according to Sky News
  • Morris_DancerMorris_Dancer Posts: 61,963
    Mr. Easterross, one wonders how long it will take before the first politician argues for guns in videogames to be banned.
  • CharlesCharles Posts: 35,758
    Pulpstar said:

    @taffys I've heard it will both raise and lower revenue.. so I'm inclined to think it won't make much difference.

    The IFS was pretty damning just now on Chris Leslie's claim that the OBR believed the increase from 45% to 50% would raise £3bn. (he called it "disingenuous" on Radio4).

    He also said that Labour had previously claimed that the rise from 40% to 50% would raise £2.6bn, so it doesn't seem credible that a rise from 45% to 50% would raise more than a rise twice as large.

    That's pretty strong stuff from an organisation that is pretty neutral politically.
  • Danny565Danny565 Posts: 8,091
    edited January 2014
    taffys said:

    ConHome is quite clever on the 50p tax.

    How are labour going to fund it?

    That is not going to fly with the public. Even if it is true that lower taxes bring in higher revenues (and the stats which "prove" that are dubious to say the least), it just seems too counterintuitive, and if it's counterintuitive, the public aren't going to believe it. And no amount of government bar charts will change their minds. Simple as that.

  • Morris_DancerMorris_Dancer Posts: 61,963
    Mr. 565, I agree that it almost certainly won't fly.
  • EasterrossEasterross Posts: 1,915

    Hmm. I saw that Ed Balls tweet. Spoof was the first word that came to mind.

    Probably more accurate and honest than the real account, though.

    Turns out to be a spoof account. Very like his real one- sorry folks :(
  • SocratesSocrates Posts: 10,322
    edited January 2014
    @GeoffM

    How does it work for (relatively) wealthy people like me, then, who agree that the fair thing is for those of us reaping high rewards from our economic system to subsidize public services for those on lower incomes?
  • Morris_DancerMorris_Dancer Posts: 61,963
    Mr. Easterross, don't worry about it.

    Anyway, it's unsurprising that people want fairer taxes, where fairer equals paying more if you earn more money than the individual in question.

    On this 10p rate: is this to be from £10k plus, or from a lower amount up to £10k?
  • taffystaffys Posts: 9,753
    Simple as that.

    Yeh, the public are stupid.

    Typical patronising Islington labour attitude.
  • MikeSmithsonMikeSmithson Posts: 7,382

    Another mass shooting currently taking place in the NE USA. 3 dead so far according to Sky News

    And Mr Farage wants it to be easier for us to have guns

  • EasterrossEasterross Posts: 1,915
    So which pollsters if any will we be arguing about this evening other than YouJokeGov
  • MikeLMikeL Posts: 7,723

    On this 10p rate: is this to be from £10k plus, or from a lower amount up to £10k?

    It will obviously be on income above £10k (or whatever the PA is at that point).

    I am not a Labour supporter but it is blindingly obvious that no Government is going to cut the PA.
  • Morris_DancerMorris_Dancer Posts: 61,963
    Mr. L, you say 'obvious', but unless it's a very small band (and even then) it'll cost an absolute fortune.
  • MikeLMikeL Posts: 7,723
    Quiz question:

    Q: How many people on here realise that the 10p tax rate still exists today?

    A: It does! But it only applies to savings income and then only if you don't have earned income which takes you above the threshold.

    For 2013/14:

    PA = £9,440

    Then 10p rate applies on next £2,790 of savings income only

    So disappears at £12,230

    http://www.hmrc.gov.uk/rates/it.htm#2a
  • PulpstarPulpstar Posts: 78,410
    edited January 2014
    Charles said:

    Pulpstar said:

    @taffys I've heard it will both raise and lower revenue.. so I'm inclined to think it won't make much difference.

    The IFS was pretty damning just now on Chris Leslie's claim that the OBR believed the increase from 45% to 50% would raise £3bn. (he called it "disingenuous" on Radio4).

    He also said that Labour had previously claimed that the rise from 40% to 50% would raise £2.6bn, so it doesn't seem credible that a rise from 45% to 50% would raise more than a rise twice as large.

    That's pretty strong stuff from an organisation that is pretty neutral politically.
    But I never said it would raise revenue, I just said it is doubtful whether it would drop it...

    Conhome is asking how Labour would fund it though - which implies it would decrease tax revenue. That is as debateable as saying it would increase it.

    This is purely political argument I think - it neither drops revenue as the Conservatives claim nor raises it as Labour claim. It is economically neutral, it might up tax revenue a smidgen at the expense of overall GDP - but I think the overall effect is gnat's farts at the edges.

    Where exactly is the maxima of the laffer curve anyway ?
    It is a point hotly debated - the estimates seem to vary anywhere between 30ish and 70ish %.
  • CharlesCharles Posts: 35,758
    MikeL said:

    Quiz question:

    Q: How many people on here realise that the 10p tax rate still exists today?

    A: It does! But it only applies to savings income and then only if you don't have earned income which takes you above the threshold.

    For 2013/14:

    PA = £9,440

    Then 10p rate applies on next £2,790 of savings income only

    So disappears at £12,230

    http://www.hmrc.gov.uk/rates/it.htm#2a

    So it only benefits pensioners and trustafarians?
  • MikeLMikeL Posts: 7,723

    Mr. L, you say 'obvious', but unless it's a very small band (and even then) it'll cost an absolute fortune.

    Agreed. But they'll do it somehow.

    For starters they will cut the 40% threshold so high earners don't benefit.

    Remember this Government has raised the PA massively more than inflation. Labour will revert to inflation rises in PA - which will be approx £200 per year.

    In contrast the PA rose £1,335 this year - ie £8,105 to £9,440.
  • Wulfrun_PhilWulfrun_Phil Posts: 4,780
    Portsmouth Council Lib Dems have put two fingers up to Clegg.

    Hancock cannot officially be a member of the Lib Dem Group on the Council since his membership of the party has been (belatedly) suspended (by Clegg). But regardless of that, the Lib Dem Group of councillors are quite content for him to carry on in his previous role on the Council Cabinet, a role which would normally only be taken by a leading member of the Lib Dem Group, as if nothing had happened.

    http://www.bbc.co.uk/news/uk-england-hampshire-25894167

    Will Clegg do anything in response? Such as, say, publically criticise their decision? Since the decision was taken yesterday, from the silence it seems that the answer is no.
  • MikeLMikeL Posts: 7,723
    edited January 2014
    Charles said:


    So it only benefits pensioners and trustafarians?

    Yes, mainly. Or anyone who has stopped working early but not yet getting pension but has savings income.

    NB. Pensioners don't benefit if their earned income is above approx £13k (they get higher PA ) - as earned income is counted first (and taxed at 20%).
  • MrJonesMrJones Posts: 3,523

    Portsmouth Council Lib Dems have put two fingers up to Clegg.

    Hancock cannot officially be a member of the Lib Dem Group on the Council since his membership of the party has been (belatedly) suspended (by Clegg). But regardless of that, the Lib Dem Group of councillors are quite content for him to carry on in his previous role on the Council Cabinet, a role which would normally only be taken by a leading member of the Lib Dem Group, as if nothing had happened.

    http://www.bbc.co.uk/news/uk-england-hampshire-25894167

    Will Clegg do anything in response? Such as, say, publically criticise their decision? Since the decision was taken yesterday, from the silence it seems that the answer is no.

    Crick and Channel 4 will be on the case soon, that'll sort em.
  • PulpstarPulpstar Posts: 78,410
    MikeL said:

    Mr. L, you say 'obvious', but unless it's a very small band (and even then) it'll cost an absolute fortune.

    Agreed. But they'll do it somehow.

    For starters they will cut the 40% threshold so high earners don't benefit.

    Remember this Government has raised the PA massively more than inflation. Labour will revert to inflation rises in PA - which will be approx £200 per year.

    In contrast the PA rose £1,335 this year - ie £8,105 to £9,440.
    You'd barely know it, the Lib Dems should have been crowing this from the rooftops as it was their idea but they have been really silent. The fact that they are stumbling so badly in the opinion polls despite the fact they have made your average basic rate working tax payer better off is telling. It looks like it will be a case of thanks - but here's the door at next GE.
  • CharlesCharles Posts: 35,758
    Pulpstar said:

    Charles said:

    Pulpstar said:

    @taffys I've heard it will both raise and lower revenue.. so I'm inclined to think it won't make much difference.

    The IFS was pretty damning just now on Chris Leslie's claim that the OBR believed the increase from 45% to 50% would raise £3bn. (he called it "disingenuous" on Radio4).

    He also said that Labour had previously claimed that the rise from 40% to 50% would raise £2.6bn, so it doesn't seem credible that a rise from 45% to 50% would raise more than a rise twice as large.

    That's pretty strong stuff from an organisation that is pretty neutral politically.
    But I never said it would raise revenue, I just said it is doubtful whether it would drop it...

    Conhome is asking how Labour would fund it though - which implies it would decrease tax revenue. That is as debateable as saying it would increase it.

    This is purely political argument I think - it neither drops revenue as the Conservatives claim nor raises it as Labour claim. It is economically neutral, it might up tax revenue a smidgen at the expense of overall GDP - but I think the overall effect is gnat's farts at the edges.

    Where exactly is the maxima of the laffer curve anyway ?
    It is a point hotly debated - the estimates seem to vary anywhere between 30ish and 70ish %.
    I believe HMRC/OBR said that the net cost was about £100m (this was what the IFS bod repeated) - irrelevant in the context and I guess the signalling benefit ("attractive for business") is worth something (although I don't know if that is factored into the HMRC analysis)

    There was an analysis of the Laffer Curve at some point. IIRC somewhere around 47/48% was the theoretical maximum.

    From my perspective - as a 45% rate payer based on my earned income - I get more irritated about the loss of the personal allowance than about the marginal rate of tax (it tells me that the government regards me as a second class citizen). Additionally, I have a general view that what the marginal rate (income tax + NICs) gets above half my income then the government is being very greedy. 40/45% +2% feels a reasonable contribution to make.
  • PulpstarPulpstar Posts: 78,410
    MikeL said:

    Mr. L, you say 'obvious', but unless it's a very small band (and even then) it'll cost an absolute fortune.

    Agreed. But they'll do it somehow.

    For starters they will cut the 40% threshold so high earners don't benefit.

    Remember this Government has raised the PA massively more than inflation. Labour will revert to inflation rises in PA - which will be approx £200 per year.

    In contrast the PA rose £1,335 this year - ie £8,105 to £9,440.
    Whats the PA going to be in April btw ?
  • MikeLMikeL Posts: 7,723
    Pulpstar said:


    Whats the PA going to be in April btw ?

    £10,000 precisely!

    I thought that had been quite well publicised!
  • PulpstarPulpstar Posts: 78,410
    MikeL said:

    Pulpstar said:


    Whats the PA going to be in April btw ?

    £10,000 precisely!

    I thought that had been quite well publicised!
    Goodo :)
  • QuincelQuincel Posts: 4,042

    Another mass shooting currently taking place in the NE USA. 3 dead so far according to Sky News

    And Mr Farage wants it to be easier for us to have guns

    In fairness to Mr Farage, as someone pointed out here a day or two ago (MaxPB?) the evidence about gun control and murder rates is actually far from clear. Nonetheless in terms of public opinion the British electorate are certainly of your view, so it was an interesting move I'll admit.
  • MikeLMikeL Posts: 7,723
    Pulpstar said:

    You'd barely know it, the Lib Dems should have been crowing this from the rooftops as it was their idea but they have been really silent. The fact that they are stumbling so badly in the opinion polls despite the fact they have made your average basic rate working tax payer better off is telling. It looks like it will be a case of thanks - but here's the door at next GE.

    Really? It's been repeated millions of times.

    I struggle to think of anything which has been stated more often by Con / LD politicians.

    Of course that doesn't mean the public knows - because most people don't listen to anything which politicians say.
  • Morris_DancerMorris_Dancer Posts: 61,963
    Mr. L, but isn't the 40% threshold already surprisingly low, as governments haven't wanted to increase it for political reasons?

    Sadly, I earn far too little to trouble it, but isn't the threshold around £45,000 or so? A quick google suggests it's only £34,000(ish). Lowering it much more will squeeze the 20% rate into oblivion.
  • PulpstarPulpstar Posts: 78,410

    Mr. L, but isn't the 40% threshold already surprisingly low, as governments haven't wanted to increase it for political reasons?

    Sadly, I earn far too little to trouble it, but isn't the threshold around £45,000 or so? A quick google suggests it's only £34,000(ish). Lowering it much more will squeeze the 20% rate into oblivion.

    You need to add the personal allowance on top. The HMCE site on this is UTTERLY atrocious in making that clear.
  • MikeLMikeL Posts: 7,723
    Well if Lab goes for rent controls there will be real problems for anyone looking for somewhere to rent.

    No sane person is going to allow the Government to confiscate their property.

    And that is what rent controls amount to - you are stuck with someone in your property who you can never ever get out and the Council telling you what you can charge them.

    Most people will not remember the 1970s and will have no idea what is coming.
  • volcanopetevolcanopete Posts: 2,078
    If the 50p rate brings in no revenue,why did this occur?
    http://www.ft.com/cms/s/0/9f4c00ea-0977-11e3-8b32-00144feabdc0.html#axzz2rR33x95B
  • Quincel said:

    Another mass shooting currently taking place in the NE USA. 3 dead so far according to Sky News

    And Mr Farage wants it to be easier for us to have guns

    In fairness to Mr Farage, as someone pointed out here a day or two ago (MaxPB?) the evidence about gun control and murder rates is actually far from clear. Nonetheless in terms of public opinion the British electorate are certainly of your view, so it was an interesting move I'll admit.
    I believe that was myself. MaxPB was oppose dto the idea of liberalising gun laws. I pointed out that whilst it was politically difficult all the evidence is that gun bans do nothing to reduce murder or suicide rates.
  • Another mass shooting currently taking place in the NE USA. 3 dead so far according to Sky News

    And Mr Farage wants it to be easier for us to have guns

    Yep. Sensible man. Looks at the evidence rather than knee jerk reactions.
  • Morris_DancerMorris_Dancer Posts: 61,963
    edited January 2014
    Ah ha! So my guess was nearly spot on. Cheers, Mr. Pulpstar.

    I'm even further from troubling the higher rate than I thought.

    Edited extra bit: off into a storm to walk the hound.
This discussion has been closed.