Adam Smith Institute

The Compass folks are really rather upset that even Gordon Brown ( yes, even!) has realised that a windfall tax on the energy companies isn't a good idea as this this little article shows. But we'll leave them weeping their bitter tears at the failure of their populaist advancement of an entirely silly idea and concentrate just one one point then mention almost in passing:

The package of measures he had hoped to be able to announce this week to help people cope reportedly had to be postponed due to continuing wrangling with the energy sector, a sector which currently spends a paltry £50 million a year combating fuel poverty.

Where on earth does it come from, this idea that the energy companies themselves should be paying to combat fuel poverty? What stupidity are they propounding now?

We don't suggest that Tesco's should feed the poor at cheaper rates than the rest of us, don't demand that Aston Martin makes a low cost model affordable by everyman. We don't insist that brewers make cheap beer so that the low paid can also get a buzz on (rather the opposite actually). So where does this thought come from, that the energy companies are responsible for heating the poor?

We want the supplier of whatever it is to be as efficient as possible of course, to deliver food, energy, transport at the lowest price so that we may consume more of it. We also note that companies run for the profit of their owners perform these tasks more efficiently than those which are not.

Now it may indeed be true that the market distribution of incomes leaves some unable to consume what we think that they should be able to consume. That without any welfare state, without any redistribution at all, some would indeed be colder, hungrier than we think just. To which the answer is that we have to dig into our own pockets in order to provide them with the money they need in order to get what we think is just.

Of course it's entirely predictable that we would prefer another's pocket to be emptied to pay for what we think morally justified....but the only moral such tax is one which we are willing to pay ourselves. Perhaps offering more to the poor to aid in coping with higher energy prices is a good idea and perhaps it isn't, that's not the point. If the folks at Compass had started their campaign by offering to pay more tax themselves in order to heat and light the poor their campaign would carry a little more moral weight?

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