There's only one Robert Chote.  He's rightly respected by all commentators for his sensible, well-articulated views on economics.  However, sometimes the IFS wants to say something on a topic and Robert's not around.  Then this happens:

The Institute for Fiscal Studies (IFS) said plans to taper the rate from profits on shares, second homes and other assets according to how long they have been held - a key concession to head off a revolt by Tory MPs - is "misguided".

"Taper relief is a dreadful idea," IFS senior research economist Stuart Adam told the Financial Times. "It is highly undesirable in terms of its economic effects.

"Persuading people to hold on to assets they would otherwise sell, to get a lower tax rate, is a misguided thing to do."

We already dealt with this - because government(s) can't be trusted not to let inflation run rampant, we need taper relief and/or indexation to protect the innocent.  Indexation, although complicated to calculate and administer, is fairer for addressing inflation.  But taper relief also has a role: it differentiates between those who have bought assets solely to make a quick turn and those who have bought assets to improve and develop over a much longer period, and who then will be looking to make a sensibly-timed exit.  To view these people as "holding assets they would otherwise sell" betrays a peculiarly distorted, economist's view of the world.

If we want to raise the CGT rate (and I think we do, no matter what the Wicked Witch of the Lords, Baroness Noakes, might say), we need to protect entrepreneurs who have held or intend to hold assets for a long time and we need to protect people from inflation.  Entrepreneurs generally can't put their companies into pensions, so they need some other way of protecting their retirement.  That basically means taper relief because it's fair, regardless of whether economists view it as pure.

By the way, Stuart Adam studied PPE at Oxford - run away, run away!

Filed under: Economics, Taxation with tags baroness noakes, capital gains tax, ifs, indexation, inflation, oxford university, ppe, robert chote, stuart adam, taper relief
33332 Comments »http%3A%2F%2Fwww.fcablog.org.uk%2F2010%2F06%2Fwhy-the-ifs-is-wrong-on-cgt-taper-relief%2FWhy+the+IFS+is+wrong+on+CGT+taper+relief2010-06-10+09%3A18%3A55Christie+Malryhttp%3A%2F%2Fwww.fcablog.org.uk%2F%3Fp%3D3333

OK, it's probably unfair to pick on a whole class of people who studied a particular subject at a particular university. But Labour does seem to have rather a lot of people who studied PPE at Oxford.

Here's a snapshot from a year or so ago:

(okay, I'm too lazy to check whether these people all really were the Cabinet on a particular date, but this article says 7 too)

The problem isn't the course. It isn't even the university. But it's the fact that so many of these people aspired to nothing other than climbing up the greasy pole of the Labour party in order to become MPs. Most of them have never had proper jobs, but have got into politics via their local Labour party or as a special advisor to an MP.

This isn't good for politics, and it certainly isn't good for us. And Labour tends to attract more of this type of person than other parties.

Filed under: Politics with tags oxford university, ppe, reasons not to vote labour
22891 Comment »http%3A%2F%2Fwww.fcablog.org.uk%2F2010%2F04%2Freasons-not-to-vote-labour-62-ppe-at-oxford%2FReasons+not+to+vote+Labour+%2362+-+PPE+at+Oxford2010-04-27+14%3A17%3A17Christie+Malryhttp%3A%2F%2Fwww.fcablog.org.uk%2F%3Fp%3D2289

Bellagerens is unhappy with Ed Balls. Balls has deemed that Latin is useless in schools. In response, the delightful Boris Johnson responded:

[T]here are times when a minister says something so maddening, so death-defyingly stupid, that I am glad not to be in the same room in case I should reach out, grab his tie, and end what is left of my political career with one almighty head-butt.

Something I think we'd all pay good money to see. But Balls's comments are deeply ignorant. Not so long ago, before universities had developed fully-fledged undergraduate computer science courses, classics was the preferred subject for computer software companies when selecting graduates. They found that classics graduates were better than graduates of other disciplines at thinking clearly through a problem. Must have been all those Latin sentences, I guess.

The same skills are valuable in accountancy too. Accountancy also requires precision of thought. Unpicking the debits and credits (lest we forget, words both derived from Latin) that are needed to account for a particular transaction use many of the same sorts of skills that you would use in deconstructing a Latin sentence. And just like UK accountancy’s concept of ‘true and fair’, you might be able to find several answers in Latin translation, but some of them may be better than others. Elegance has a part to play in both disciplines.

Besides, Latin is a brilliant sourcebook for determining how English grammar works and for remembering how to spell fiddly English words. It’s much more difficult for someone who has studied Latin to misspell, say, “independent”, because the Latin pendere screams out at them. Subjunctives in English? Not a problem, you probably learnt them in Latin. Nobody ever taught me them in English. They didn’t need to.

Even for a quiet, reserved boy like me, Latin’s educational payload was irresistible. By translating these texts into English, you revealed mighty battles, terrible monsters such as Scylla and Charybdis (go on then, which would you choose?) and the deception of the Trojan horse. We learned about monumentally sensible Roman ideas, such as building roads in a straight line or building heating under the floor, and some ghoulish practices such as the punishment of decimation for cowardly soldiers. Take away the Latin and the rationale for teaching these to children goes away. Why teach children rancid subjects like citizenship when you can teach them about how the Roman Senate worked? Or about what democracy meant in Roman times?

has a bee in his bonnet over the issue. Even now, it would appear that those who studied Oxford’s terrifying four-year Literae Humaniores, known affectionately as Greats, look down snippily on the lesser mortals who could only manage PPE. In the lesser camp is Balls, who one might imagine was heavy on the politics and economics and light on the philosophy, wouldn’t even have studied the most valuable element of the course.

Filed under: Other blogs with tags bellagerens, boris johnson, ed balls, latin, literae humaniores, mythology, oxford university, ppe
11862 Comments »http%3A%2F%2Fwww.fcablog.org.uk%2F2010%2F03%2Fin-praise-of-latin%2FIn+praise+of+Latin2010-03-17+20%3A41%3A15Christie+Malryhttp%3A%2F%2Fwww.fcablog.org.uk%2F%3Fp%3D1186