Direct democracy. What a wonderful phrase. Just roll it around on your tongue for a little while and savour the warm, juicy flavours of the brew. Direct democracy. Mmmm, if Nescafé could capture that aroma, they’d make a mint.
So, what is this heady mixture? Here’s what Wikipedia says:
Direct democracy (or pure democracy) is a form of government in which people vote on policy initiatives directly, as opposed to a representative democracy in which people vote for representatives who then vote on policy initiatives. Depending on the particular system in use, it might entail passing executive decisions, making laws, directly electing or dismissing officials and conducting trials. Two leading forms of direct democracy are participatory democracy and deliberative democracy.
Without going into the technicalities of how and why, let’s think about Britain, which has a system of representative democracy, and how it would benefit us as a nation.
Representative democracy is a fudge: it happened because we couldn’t implement direct democracy and because the men – and they were men – at the top wanted to retain some measure of control. Perhaps they thought they knew better than the average punter, so their wisdom was needed to keep things going.
Since then, they have been screwing everything up royally. Okay, there’s the argument that the present economic system has within it the seeds of its own destruction, and there’s probably some truth to that, but managing capitalism is not the most difficult of tasks. It boils down to three things:
1) Make sure people buy stuff
2) To do that, you have to make sure people have money
3) Make sure people make stuff that other people want to buy
It couldn’t be easier really. So, what to the masters of the universe do? They make sure only a tiny number of people have money, they stop making stuff and get people doing financial transactions and selling insurance, and they make the stuff that people want to buy too expensive to buy by taxing it to death and giving that to the people who already have money. Expletive alert: FFS… Are these people brain dead?
So, I think we need to show them how it’s done. Direct democracy. We, the people of the United Kingdom of Great Britain and Northern Ireland do solemnly resolve to sort out the mess made by the bankers, politicians, aristocrats and billionaires, because we just can’t trust you anymore.
Let’s have a pilot scheme and take control of an aspect of government, because those we entrust with our money are just doing it wrong. Let us take control of the purse strings and vote on how the government is going to tax us.
I don’t want to tell them how to spend the money (yet), or how much they need to generate to run the country (yet), we can carry on electing them on the basis that they carry out a programme contained in their manifestos, obviously adjusting it to meet circumstances and allowing for “interpretation” – see me after school Brown and Blair, we need to talk about a referendum we didn’t have. However, I’d quite like the opportunity to recall those naughty ministers who make whopping big promises that turn out to be whopping big fibs. Yes, you young Clegg, I’m looking at you. But that’s another argument and another blog post, as well as being another promise Cameron and Clegg never lived up to.
Suffice to say, I’m proposing that Parliament puts to the people a series of tax proposals and we vote on them. Every year.
The criteria would be, the Government would lay out its programme, the Treasury, or an independent body would assess the cost of the programme and then we would be offered various ways of funding it.
I did think of hard coding it, so that we would have something like four or five proposals that were fixed in nature, something like:
- A fixed, flat rate of tax for everyone, and a VAT rate that would top it up
- Two tax bands, one for low earners, one for high earners and a VAT rate to top it up
- Three tax bands of a,b and c plus a VAT rate that tops up the requirement
- Three tax bands of d,e and f plus a VAT rate that tops up the requirement
- Three tax bands of g,h and i plus a VAT rate that tops up the requirement
The last three proposals would place different emphasis on each of the bands – in other words, someone is going to pay, so it may as well be the other fellah.
Then I thought, maybe a good alternative way would be to have a matrix of choices to increase or decrease bands and VAT by a set amount. This would be doable electronically, so if you decrease one band by a per cent or two, you have to increase one or more of the others. The various rates could be determined by each of the parties with more than x number of MPs, with each proposal having to pass the Treasury##Q##s estimate of the yield needed.
Obviously, if there is a shortfall, the government would have to run a deficit, but make it up next time around, if there##Q##s a surplus, that would have to be factored into the following year##Q##s calc.
Then I thought, this is all getting too complicated for trial run, we need to simplify it and so I had to lean on our representatives again – a bit of fudge, I know, but hear me out.
It did occur to me that for the Chancellor to do this would be an abrogation of his constitutional duty. Not only that, but there would be difficulties in interpretation. With all those options do you assess the answer on first past the post, or some weighted system?
I think we can dismiss first past the post, because we could end up with a tax system favoured by a well organised 17% of the voters. A little bit like our government: which is really a dictatorship of the minority – those floating voters who have decided every government since the year dot.
The other thing is, of course, taxation is not just income tax and VAT. The Treasury##Q##s collections are ranked as follows:
- 1) Income tax
- 2) NI
- 3) VAT
- 4) Corporation Tax
- 5) Excise Duties
So, it is a bit more complex than just income tax and VAT. Perhaps though, we can just have a pilot on the two taxes that we notice the most – the first affecting our pay packet, the other affecting our spendies.
Then there’s the question of the government’s constitutional duty. The constitutional argument is one that weighs heavily with me, but I think we are now, finally, in a position where direct democracy is a real possibility, both in terms of the populations’ educational standing and from a technical standpoint. Having said that, I think it needs to be guided, because we currently lack the sophistication to be fully direct, but we’re getting there.
As for deciding how to select the most popular option, I##Q##m pretty sure we could have a transferable vote system, in which the voter orders their preferences. That unfortunately would presuppose fixed positions though, which isn##Q##t as desirable as the guided flexibility I proposed above. I AM leaning towards fixed positions though. Perhaps the largest party could put forward three alternatives, the opposition two positions and the next largest party could suggest one. So we would have six positions validated by the treasury, or an independent body, on which we vote, with the most popular position after all the preferences were transferred being adopted by the treasury for year.
When I first mooted this, it was suggested that this would cause too many annual variations in the tax scheme and it would be expensive to implement. Well voting need not be expensive – we could utilise local libraries and conduct the vote over a period of say two weeks, allowing people plenty of time to discuss the proposals and go to the library, login to a website, present their unique ID (which is surely not beyond the wit of the government to implement) and make their mark online – perhaps with assistance from observers.
As for annual changes costing too much, I think that’s a fallacy, plain and simple. Every year of my life, income tax has changed, either by the rate varying, or the allowances changing. So, no increased costs there, just keep calm and carry on.
VAT hasn’t varied as much as Income Tax, and certainly not annually – here’s a brief history of VAT.
- VAT started at 10% in 1973 by Anthony Barber.
- In 1974, Healey dropped the basic rate to 8% and introduced a luxury VAT at 12.5%
- Later in 1974, Healey increased the luxury VAT to 25%
- In April 1976 Healey dropped the luxury element down to 12.5%
- In June 1979 Howe increased the basic rate to 15% and abolished the luxury rate.
- Norman Lamont increased the basic rate to 17.5% in 1991
- In 1992 Lamont extended the scope to include domestic fuel and power at 8%
- In 1995 Lamont tried to increase the rate on fuel and power to 17.5% but lost the vote in Parliament
- In 1997 Brown reduced the rate of VAT on domestic fuel and power to 5%
- In 1997 Brown reduce the rate on installation of energy saving materials to 8%
- In 1998 Brown reduced the VAT on sanitary protection products to 8%
- In April 2001 Brown reduced the rate on children##Q##s car seats to 8%
- In May 2001 Brown reduced the rate on conversion and renovation of certain residential properties to 8%
- In July 2006 Brown reduced the rate on contraceptives to 8%
- In July 2007 Brown reduced the rate on smoking cessation products to 8%
- In Nov 2008 Darling reduced the standard rate of VAT to 15% until Jan 2010
- In January 2011 Osborne increased the standard rate to 20%
Tories increase VAT – nah mate
Now, I am tempted to state the obvious and point out that one party has consistently reduced VAT and one party has consistently increased it. Oh… I just did. Oh well, in for a penny, in for a pound. The fact is the only party to ever reduce VAT is Labour and the Tories have increased it every time they have been in government, yet the Tories are regarded as the party of low tax. This is as good an example of propaganda working successfully as you will ever see. It’s worse if you look at the Tories promises before each election – “Nooooo. Increase VAT? Perish the thought.” The public buys it every time.
Anyway, here’s my idea – each of the three main parties, whoever they might be, puts together a tax proposal, which is audited by the Treasury, or an independent body, simply to verify that the proposal would generate sufficient income to meet the Government’s spending plans. IF, the treasury gets it wrong, then the government can run a deficit budget and make an adjustment the following year. No biggie, the so called deficit cutters are running deficit budgets every year and building up our debt mountain year on year. If there’s a surplus, then happy days – we all get a bank holiday and day on a barge sailing down the Thames, or the Taff or around the lakes, whatever.
Once the tax proposals are finalised, we vote on them – they need to be simple, easy to read proposals that can’t be subject to obfuscation. Now here’s the critical bit. The press are banned from commenting on the Tax Proposals FULL STOP. Not a bloody word from you Kelvin McKenzie. That way, people can make up their own minds, not have them made up for them. The Sun says… FA.
We vote on the six proposals and mark each of them according to our preference. Once the first preferences are counted, then the bottom one drops out and the second preferences are counted. These would be weighted according to the arcane principles only some little old lady at the Electoral Reform Society knows how to calculate, and then redistributed. This would go on until we have a winner. The winner would be the tax proposal that is liked the most by most people.
Hopefully this would solve the problem of the very rich getting away with blue murder, because the Labour Party and perhaps the Lib-Dems would put forward at least one proposal that has a higher rate for the wealthy and lots less for the rest of us. We would vote for it in droves.
At least we would decide how we’re going to pay the government, or as my nan used to say: “You pays your money, you takes your choice.” Just the other way around.