Now you’re shifting your argument a bit, from denying policy was redistributive to denying egalitarian intent. I am far more interested in the former. Things happen by accident all the time
What about the tax rate chart above? (And that’s direct, not the shadow redistribution we started with.)
Also, raising the minimum wage relative to median incomes is active redistribution, not an accidental consequence of income growth. Low wage growth was known and the min wage benchmarked
I’d be very interested to see a reconciliation of that chart with the Gini trends, income ratios, tax rates and IFS work. Hard to see how it’s consistent.
Hmm, I don't know. See this chart by @tomcalver.bsky.social
To be fair, housing is doing a lot of the work here (though given housing benefit, I think this is reasonable). Before housing costs tilts growth towards the lower-middle
Is your point that this IFS chart starts too high in the distribution and misses a lot of action?
However these are consensus public finance results. They are what are taught to students. It’s fair to present them as “economics” (or no argument can be presented as such)
Regardless of that point, I’m not sure why a high earning graduate has a greater obligation to subsidise the low-earning graduate than a high earning non-graduate.
And if the subsidy was through general taxation not an interest rate / repayment threshold it would be more transparent
Off the top of my head:
Student loans, minimum wage, warm homes discount, child care cliff-edge means test, child benefit means test, pension lifetime allowance cap, buy to let mortgage interest rules
The Tories were redistributors across lots of policies
Very recently being 2012?
The Osborne years are only half the period I referred to, and in any case policies have lagged effects. The direction of travel towards was clear, as the IFS has also found
No, economists are more likely to be neutral on that, as in Saez/Stantcheva: “society” provides the weights, economists calculate the resulting optimal policy
I didn’t say primary aim. But I refer you to this:
bsky.app/profile/curr...
Let prices work and instead redistribute according to income is the essence of both Atkinson-Stiglitz and Mirrlees
It's a classic case of 2010s brain according to which every policy should be a redistribution lever. The opposite of what economics recommends
The problem with Britain's student loans is they were designed on the principle that middle-high income graduates--except those whose parents paid--should cross-subsidise low-earning graduates, rather than the general taxpayer doing so.
Why anyone would think that is beyond me
Brazil offers a cautionary tale: high interest rates are very painful even when debts are low by today's rich world standards. It is important to understand why Brazil's rates are so high
Brazil's budget situation is dire. It borrows 8% of GDP, mainly to pay for debt interest. The IMF forecasts debts will stabilise in the late-2020s because interest rates will fall by a lot. That is not what markets expect
"Remove both motherhood and any decisions women might make while anticipating it, and the wage gap seems to vanish."
"[Women with MRKH] earn much the same as other women and men in early adulthood. Then...their wage trajectory is almost identical to that of their male peers."
You can't count hidden wealth easily, no. But another thing it doesn't include is the present value of accrued state and public pension entitlements, which represent a lot of wealth further down the scale.
Pensioners on average have lower incomes before housing costs. A sale of a house wouldn’t show up in income anyway. (Or wealth since it’s just a swap of one type of wealth for another.)
Excluding them strips out one compositional effect from an ageing population
Looking good by historical standards
The population is ageing, and pensioners have always had lower incomes (though many have paid off mortgages). Including them picks up a compositional and somewhat misleading trend
Britain's income inequality is at its lowest since 1986
(Includes tax, transfers and transfers in kind; excludes retirees)
Reeves has tried to pin £26bn of tax rises on a forecast that is only £6bn worse, to fund new welfare spending that was not in Labour's manifesto, having promised not to raise taxes on working people.
Regardless of the merits of the policies, this is dishonest
"The budget was further proof of a strangely overlooked fact in British politics: Ms Reeves is a chancellor in the most economically left-wing government of the past five decades."
www.economist.com/britain/2025...
"The [OBR] gave a sunnier-than-expected outlook for the public finances, raising its deficit forecast for 2029-30 by only £6bn...she produced a vintage Labour tax-and-spend package: £26bn in tax increases in 2029-30 and £11bn in extra spending."
www.economist.com/britain/2025...
The bodge-it budget
"With the deficit still gaping at 4.5% of GDP, Ms Reeves succumbed to her own worst instincts and those of her backbenchers by increasing borrowing, relative to her previous plans, for four years"
My leader and our cover story
www.economist.com/leaders/2025...
The UK has the most progressive tax system in the developed world, argues @jburnmurdoch.ft.com
As @duncanrobinson.bsky.social wrote for @economist.com, the Tories created "an unbelievably progressive tax system".
on.ft.com/3JPv6dP
economist.com/britain/2025...
If only they could achieve primary balance
