I have published this video this evening. In it, I argue that far-right politicians hate government, or so they say. For decades they tried to deny it revenue by operating from offshore. Now, they're trying to deny funding to onshore tax authorities. In both cases, the aim is the same: they want to undermine the state by denying it the funding it needs.
The audio version of this video is here:
The transcript is:
The far right are coming for tax. I make the claim very deliberately, because I'm quite sure it's true.
Let's be clear who I mean the far right are in this case. The far right are those political parties who are built in the mould of Donald Trump's Republican Party. They do, of course, have fans in the UK. There are UK political parties who appear to adopt almost every policy that the Republicans do. And therefore, whatever I'm saying here will probably apply in the UK at some time, even if it doesn't already.
And when I say the far right are coming for tax, what I'm referring to is the fact that it seems that the Republican Party in the USA is doing its very best to defund what is called the IRS, which is the Internal Revenue Service in the USA, which over here we call HM Revenue and Customs. It's their tax authority, at a federal level, which collects money to fund the US central government.
Now, what are they doing? In essence, they're doing two things.
One is, they're reducing the powers of the IRS, wherever they can.
And two, perhaps more importantly, they're trying to deny it money. Plain straightforwardly, what they're trying to do is reduce the capacity of the IRS to collect the money that is owing to it.
And in particular, again, in two ways.
Firstly, they're trying to prevent it computerising most of its records. Absolutely incredibly, vast quantities of the records of the IRS in the USA are still manual on the basis that there's nothing else to put them on because the computer systems that have been funded for the IRS to use are simply not up to the job.
Secondly, the Republicans are trying to deny the right of the IRS to undertake the audits of the wealthy in the USA. who, in particular, are the most likely to defraud it of significant amounts of money.
I'm not saying they are necessarily the biggest number of fraudsters. What we know is that in the USA, nearly half of all self-employed people do not declare all their income. Ample surveys suggest that. But, of course, the wealthy have more money, and therefore the losses when they evade taxes are bigger. And the USA has a peculiar tax system which works on the basis of audit.
Audit means that you are called in to have your tax affairs torn to shreds by the IRS to determine whether or not you made a complete disclosure. And these processes are random, in many cases, and extremely tough so that everybody else lives in fear that they will be subject to audit and therefore will comply.
But the number of audits is going down. And the financing for audits is reducing, and the reason why seems to be glaringly obvious. The Republicans are trying to ensure that the Federal Government does not have the resources it needs to deliver the services that the people of the USA want.
I think we can be fairly sure that at some point the same thing will begin to happen here as well.
The point is, is that if they can't kill the beast, as they call it, by draining the swamp, as they describe it, what they will do instead is deny the beast the resources it needs to deliver the service that people require from it, and what that service needs is money. They aren't going to give the IRS the funds to collect the tax that will keep the US government functioning.
This is deliberate policy. It's not an accident. It can't be. It's done by design and the intention is to denude the US government of cash. Wait for it, it may well happen here, and when it does, we will see a crisis enveloping the government. And we will see increasing inequality, and both of these are the deliberate desires of those who are promoting this policy.
This is one of the most cynical attacks on the basis of democratic government that I can think of. It started with the offshore world, which always existed for this purpose. Now it's gone onshore, and it's very much taking place in Washington DC.
Expect it here soon. This is a very disturbing trend within the political agenda.
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Richard, thank you for publishing this timely warning.
I have to agree that what happens in the US frequently appears on our shores at some later time. It seems to me to be bound to create utter chaos. My immediate reaction to this (still trying to believe that the yanks can be so foolish) is that they will effectively destroy their currency through inflation.
No doubt the right wingers will want to pump oil too…. (see below)
I say this because what I am learning (still have a long way to go) is that it is tax that citizens are obliged to pay that effectively gives the currency its value. Also by taxing away government spending, it acts to reduce the money available and this controls inflation. With the rich paying less tax (I assume those less well off will still be caught and have to pay), they will seek to invest it in assets. Asset prices will rise as a result. Gradually they will accrete an ever increasing portion of the assets available into fewer and fewer hands. They will then expect to get their rentier income from the rest of population.
The joker in the pack is, perhaps, climate change.
It is conspicuous by the way it is destroying assets…..
Over generational timescales, With no insurance available, who will want the vulnerable assets?
Who will know how to identify reliably what is vulnerable?
It might well destroy dollars as skilfully as the IRS.
HMRC is already under funded. I can remember a time when, if you had any tax issues, you could go round to your local tax office for advice.
Like all extremists, these ‘hyper-liberals’ always want more even though it looks to me that they already have everything!
How does one deal with this?
Well, you have to lose your squeamishness about curbing liberty and realise that there are constraints (there’s Carl Schmitt right there folks).
The emergence of order in human beings – societal, political – had an element of balance in it between authority and liberty.
Extreme money does not recognise this balance. Maybe because that is how the wealth was accrued in the first place ,where the rules of the market are not the same as society’s.
And we have ill advisedly allowed extreme wealth to proliferate. Extreme wealth thinks that it is the exception, and that it is sovereign.
And that is sold as a valid goal to all of us.
Well, it ain’t so.
It cannot be that one can exercise one’s liberty at the expense of others. That is not liberalism in any shape or form, because it ignores the needs of others. And signifies a failure of a political system to boot.
But this is how we have come to live.
It is wrong.
That is why tax is important – not just for controlling inflation/monetary effects. But also to stop spillovers into the political system (and other systems) and to curb greed and anti-democratic power.
We have become blind to these faults in part because we have been encouraged to forget about the power of the state and the hard lessons we have learnt about private monopolies. Instead, we put our faith in the dreams and aspirations of monopolists who do not play by the same rules as everyone else and pretend to us that we can be like them.
Thus the PR exercise that is Neo-liberalism goes on.
Thank you PSR for this heartfelt exposition of our dire straits.
@Pilgrim Slight Return
I totally agree with you. Sadly, the world has been here before and the dangers we now face were recognised in an analagous way millenia ago.
If anyone is interested, it is discussed in a book by Professor Michael Hudson “The Destiny of Civilisation” and in “The Collapse of Antiquity” in far more detail. He is based at UMKC in the US.
There are youtube videos of him discussing his ideas and also articles can be found on the web. (Personally, I got far more from the first book).
His prognosis for the present can be summed up as ‘Barbarism or Socialism’. He sees the world as in the process of splitting; the West to the former, and the rest of the world working its way to the latter.
Sobering!
“It’s their tax authority, at a federal level, which collects money to fund the US central government.”
Who are you, and what have you done with Richard Murphy? Taxation is to control inflation, not to fund government spending!
A central government cannot find itself without tax
Sure, it creates the money first
But without tax it could not do that.
So, let’s not get totally hung up on this. Please see the big picture.
(I think it was a joke)
: – )
I am ploughing my way, very slowly, through the Heritage Foundation 2025 Project document, which you can download.
It’s scary.
It sets out clearly what the far right Republicans want to achieve. Effectively dismantling the US federal system of federal law for example removing workers rights and environmental protections.
But like Mein Kampf it is being totally ignored by the main steam media.
I have not read it all
You are right
But maybe, just maybe, they won’t get the chance to deliver it
Further thoughts on camera angle changes if I may.
I agree with Keith Smith from yesterday that they are more distracting than anything else. However, as I did say yesterday, it might serve to emphasise a point and keep the viewer engaged instead of nodding off.
In today’s production you could, for exmple, change camera angle at “Now, what are they doing?” But it would need to be at the exact moment before the word “Now”, and you would need to turn to camera with a slight pause. That might be beyond, with repsect, your capabilities because it would require choreographing and directing.
As Marshall McLuhan said the medium is the massage (although that was a typo and it should have been “message”. He decided to keep that because it seemed more apt).
Bournemouth University has an excellent cimemotography, film and TV department. Maybe you could ask them for some tips?
The probolem is these are not scripted so I would need to not only be scripting as I go bit also be wroking out camera angles as I do that.
That may be too hard.
We will see.
Totally accepted. The videos are perfectly adequate as they are. But drop the change of camera angle.
Yes drop the angle switch with you seemingly looking at someone who has just stumbled into the room.
This IS an important point because to a first-time viewer, it makes it look as if you don’t know where you are or what you are saying and that is the last thing we all want.
Your old videos worked, don’t fix them.
OK