Thursday, April 07, 2005

An Englishman in Wonderland

Across the sea in the land of liberty and PATRIOT acts, An Englishman in Philly has sent us a missive on Michael Howard's taxation plans. The key hope he expresses is that it can be shown that we can have better public services on less spending, and he intelligently argues that Tories need to ensure their reform agenda gets equal limelight with the tax cuts, or else they can be too easily painted as hacking services.

His problm is that they will, or at least provide poorer services than they otherwise could. Here's the key mistake:

"They [Tories] have to confront and defeat the leftist assertion that more money alone = better public services = higher tax being intrinsically more desirable."

Notice the word "alone". Because, Ed has here built a strawman for the 'leftist assertion', by assuming that many people would say the services were institutionally perfect and merely require more money. Reform is good! We will differ on the sort of reform, for sure, but can't we at least agree that a reformed service is still better with more cash than less. For example, the NHS's practices can surely be improved a great deal-- and let us have a great debate on how to do that --but at the end of the day, an increase to the funding of a perfectly reformed NHS provides more doctors and nurses.

Now, I don't think I'll be criticised for suggesting that the NHS isn't yet at a point where it is over-staffed. By all means, bring in Andrew Lansley and reform the NHS, if you can convince us all that he has a better plan than John Reid. But surely you can accept that there will be some occasions when reform of practices doesn't address underlying need for more staff and better pay for those staff, which will require taxes to remain about where they are, while you make your savings and efficiencies elsewhere.

Here are my two 'leftist' (I would say 'non-rightist') assertions:
More money = better public services = tax cutting intrinsically undesireable
Good reform = better public services = identifying good reform desireable

Finding the balance of taxation so that our free market economy functions handily is the essential brake on the first, but I really don't think the current levels of taxation are economically oppressive. Certainly, the idea that once you improve a service's practices, you can slash its budget, rather than reinvest that budget in more nurses, more police officers, more teachers, seems ridiculous to me.

In waving the flag of reform as a key to tax-cutting, Ed is sugaring the bill of Tory service cuts very intelligently. However, I simply cannot see his base assumption that you can reform as an alternative to spending, rather than as a way of making every pound more efficient. I consider myself a liberal, in the British sense, so I am all in favour of retrenchment of the state in functions it should not be doing. But when the state, rightly, takes up the burden of health care, surely it should do it well- and that requires both efficiency (via reform to find best value) and proper funding for staff. Every pound you save through reform should be plowed into those extra public servants, not my tax bill, when we're doing fine as it is.

A 'leftist' ideological commitment to unlimited increases in taxation and public expenditure is naive doctrinal blinkeredness. Yet I see little different in a 'rightist' ideological commitment to reduce expenditure. Surely the first job is to define what the state should do; work out what it will cost to do it well, and the best practice for delivering it; and then temper it with efficacy of taxation (e.g: that 90% tax rate will actually be economically stupid). To begin from the point of 'find £x billion cuts' is ridiculous, when the money saved from reforms needs to be shifted to more frontline public servants. To abuse Macaulay: reform so that we may improve, not so we may reduce.