We have an electoral system that encourages short-termist government; I suppose that is one of the penalties that goes along with the blessings of being a democracy. Having to submit to the whims of the voters every four or five years does, however, militate against long-term strategic thinking, so when a party leader exhibits some of the latter, it is sufficiently rare that one tends to sit up and take notice.
Denis Healey, ever one to turn a memorable phrase, threatened in the 1970s to “squeeze the rich until the pips squeak”. Fantastic old Labour rhetoric, matched by a 98% top rate of income tax. Nick Clegg is so much more polite about it; indeed he does a pretty good job of making the rich feel good about the prospect of paying more tax when he says:
“.. is there a time limited contribution you can ask in some way or another from people of considerable wealth so they feel they are making a contribution to the national effort?”
If you think that sounds faintly Churchillian, then how about:
“What we are embarked on is in some senses a longer economic war rather than a short economic battle”.
Mr Clegg is of course so right; the ills of the UK economy cannot be cured overnight; it will be the work of a generation. He expands on his theme as follows:
“If you are going to ask people for more sacrifices over a longer period of time, a longer period of belt tightening as a country, then we just have to make sure that people see it is being done as fairly and as progressively as possible. While I am proud of some of the things we have done as a government I actually think we need to really hard-wire fairness into what we do in the next phases of fiscal restraint. If we don’t do that I don’t think the process will be either socially or politically sustainable or acceptable.”
And that is the moral background against which aggressive and artificial tax avoidance has become unacceptable. There is a sense that we are all in this mess together, and that it will take all of our efforts to get out. It is no time for selfishness or for ignoring the public good; in that sense the wartime analogy is particularly apt. It is this aspect that the apologists for aggressive tax avoidance miss when they defend the right of the taxpayer to minimise his or her tax liability within the letter of the law; we simply can’t afford the luxury of allowing everyone to do that.
Often dismissed unfairly in the media as a political lightweight, Nick Clegg may in fact have taken the bravest and most difficult political decision of the century (and beyond) by putting his own and his party’s political future on the line in the interests of the country by entering into a coalition with fairly odd bedfellows, at a time when there was little political credit to be gained by being in government and an awful lot to lose. As I said at the time, the appropriate response to the election result and the economic crisis would have been a government of national unity, which would have spared Mr Clegg and his party the martyrdom which possibly awaits them at the next election. In my view the situation is desperate enough to call for this, but maybe the coalition was as close to that as we were realistically going to get. But how much better it would be to have Labour’s financial brains on the inside helping to find the long-term solution rather than sniping from the outside.
I see him alongside such politicians as William Hague and John Smith, who were in the wrong place at the wrong time for their own political ambitions, and had much more to offer than circumstances allowed them to. Any politician who takes a long-term strategic view on tax issues deserves an audience on novelty value alone, but Mr Clegg’s thoughts are much more valuable than that, as they help to clarify the critical nature of the next few years, and the importance of a collective approach to resolving the current economic crisis. Let us hope the British public is listening.