We are not, around here, enamoured of Polly Toynbee’s political perspicacity. And yet she manages to ask an interesting question. Even, the interesting question:
Why should we not tax and spend the same as similar north European countries?
Quite so, why not?
Not that we agree with the idea, we’re not in favour of more state, more governance. But it is the interesting and important question. Why shouldn’t we? Either why shouldn’t we agree with the idea, or why shouldn’t the polity do exactly that?
The answer being in what exactly it is that those other countries do.
Polly is really referring to the Scandinavians here, her perennial cry of why can’t we be more like Sweden? Which we could be of course, sure we could. But to do so we’d have to understand what it is that Sweden does.
Which is be more free market, more capitalist than we are. Then they slice a larger chunk off the top of the economy to redistribute. This being what the Nordic Way actually is.
Sweden has no inheritance tax, you pay a fee to go and see a GP. The school system is a pure voucher one. Denmark’s fire and ambulance services have been privately provided since the 1920s. All of the Nordics come high in those measures of economic freedom listed by Heritage and Fraser.
We could indeed do the same if we so wished. Capitalism and markets red in tooth and claw soothed by the balm of redistributionary taxation.
No, we don’t think it a good idea but it is one of the two sociopolitical models that works. The other being capitalism and markets red in tooth and claw without so much redistributionary soothing balm.
The ones where we don’t use markets and we don’t use capitalism don’t work in producing the desired end goal, which is that the people gain more of what the people desire, that measure of their becoming richer over time.
That is, to answer Polly’s question, we can only tax and spend like our North European cousins if we do as they do. We’d have to carve government out of the economy in order to provide the room to be able to tax it at those levels. Once there’s a British left that understands this point then it might even be possible to have that social democracy Polly so desperately desires. Except, of course, that she doesn’t really because she doesn’t understand what it is that makes that Nordic model work. She’d be entirely horrified if we enacted the market and capitalism part which is exactly why she can’t have the tax and spend she claims to desire.