Josh writes that a British government plan of “cutting taxes for the rich while simultaneously raising the prices on the cheapest lunch options” is “maybe good economics, but . . . probably not great politics.”
I don’t know enough about economics or about British politics to evaluate either of these claims on their own, but I’m unhappy with their juxtaposition, which fits in all to well with a familiar narrative of economics being about necessary unpopular tough choices. I’m not saying that Josh believes this particular action is a good idea, but the phrasing, “maybe good economics . . . probably not great politics” fits into that narrative.
As a political scientist, what bothers me is twofold. First, I don’t agree with the idea that whether something is “good economics” is left to be judged by the professionals, whereas whether something is “good politics” can apparently be assessed by a few headlines. Second, political considerations probably did come into play in these government plans! Those people who want their tax rates lowered by five percentage points, they have political power.
{ 4 comments… read them below or add one }
Andy: Apologies – I should have just said that I was not going to get into the merits of the economics arguments. And I don’t doubt that many political considerations went into who gets a tax cut in the current British budget! At the same time, I feel pretty comfortable with the claim that they did not anticipate the political implications of Pasty-gate, which is what I was getting at in the post.
But good call on not buying into the claim that just because something is tough to swallow politically, it must be good economically. I share your aversion to that statement, so want to be clear that I did not mean to inadvertently endorse it.
Josh:
Yeah, it’s funny, I am always pretty eager to emphasize my lack of macroeconomics credentials. I think that’s fair, given that I know next to nothing about macroeconomics, but it also has the effect of reinforcing the idea that economics is for experts whereas anyone can express an opinion about politics.
If politics are defined as who gets what, where, when – then leaving economics to the economists is very dangerous for the political system!
And, for the record: Cornish pasties are a moral good. They should remain untaxed.
I don’t think the government was expecting their initiative to have mushroomed* into quite the media event it has, but it’s been amplified by the panic buying of petrol after a few careless words from a government minister. A couple of economists have semi-seriously speculated that the extra revenue from all the oil sales in the last week could tip the balance when it comes to determining whether Britain has gone back into recession. Now THAT would be good economics.
*An essential ingredient in a good steak pasty, IMHO.