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As someone who is left-leaning, I'm quite prepared to accept that a business has to make a profit. My issue is about where those profits actually go. The emphasis seems to be towards rewarding the people who start/invest in the business, and I have no issue with this as long provided those profits are generated solely by those people; if you're relying on the labour of others in order for your business idea to be successful, then your workers are also "wealth creators" and have every right to benefit from a share of the profit that your business makes.
They’re benefitting by being in paid employment; their wages/salary are deducted from their employers gross profit. Whether that remuneration is fair of course is another question!
Personally, I believe that if you’re in employment the reward should be such that you aren’t “just about managing” which is the idea of the living wage. I am however a firm believer in meritocracy in this context. If you possess skills, qualifications and experience that are relatively scarce and/or in demand, you can and should expect a higher level of remuneration than somebody who does not (which is basically how the labour market works under capitalism).
I should add however, that whilst I don’t believe in equality of outcome I firmly believe in equality of opportunity, and we’re falling down terribly in this regard. Far too many people simply aren’t given the chance to reach their potential. If you take the horse to water and it refuses to drink then fine, it’s a silly horse, but you do actually need to take it there in the first place!
They’re benefitting by being in paid employment; their wages/salary are deducted from their employers gross profit. Whether that remuneration is fair of course is another question!
if you're relying on the labour of others in order for your business idea to be successful, then your workers are also "wealth creators" and have every right to benefit from a share of the profit that your business makes.
Why? Remember the profit is to a large extent a reward for taking the risk of investing in something that may fail and lose you all your money. But what risk are the employees taking? Even if the business makes a loss, they can still expect to be paid in full for the hours they put in. If they turn out to be unproductive and don't contribute to the business, then they are still paid in full for the hours they have put in (although the business might choose not to continue to employ them). They can also walk away at any time (subject to notice periods) while being paid in full for the hours they have put in.
The employees are (rightly) not expected to share in any losses the business makes. So why should they expect to share (beyond their normal salary) in any profits?
Sorry I wasn’t thinking there! You’re right; salaries aren’t but wages are.
Edited to say ignore the above, it’s early! Cost of goods sold generally includes wages for production workers etc. paid at an hourly rate, but not salaries. Therefore, salaries are deducted from gross profit (along with other fixed costs) to arrive at net profit. That’s certainly the case at my company although it’s possible that others work differently. I probably need to spend an hour with our CFO as I’m clearly rusty!
Sorry I wasn’t thinking there! You’re right; salaries aren’t but wages are.
Edited to say ignore the above, it’s early! Cost of goods sold generally includes wages for production workers etc. paid at an hourly rate, but not salaries. Therefore, salaries are deducted from gross profit (along with other fixed costs) to arrive at net profit. That’s certainly the case at my company although it’s possible that others work differently. I probably need to spend an hour with our CFO as I’m clearly rusty!
Correct for staff salaries. Dividends to shareholders aren't:
For a company, it's roughly: Net profit = all your income - salaries you pay - all your other expenses.
Once net profit is calculated, you pay a % of that to the Government as corporation tax.
Then out of what's left, you can choose to pay dividends to shareholders or use it to invest back in the business (or postpone the decision by just leaving the money in the bank account). Those are the only things you are legally allowed to do with the profits, after tax. (Note that if you pay dividends, the people who receive them will have to pay further income tax since their dividend income counts as income).
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For attacking a system that has generated massive incomes whilst the plebs suffer on the breadline and have no other opportunity to prevent this from happening? Why does that make it wrong for Labour to want to tax these companies that have mountainous profits and not tax the companies to support society as a whole? Or does that sound too much like helpful?
But those massive incomes/profits are usually only massive because of the size of the company. Proportionate to the amounts invested, the profits are likely to be much more reasonable: If a company has made £millions or £billions in profit, it's generally not because Mr. I'm-So-Lucky invested £100 and put in half an hours work and made £10 million. It's because lots of people between them invested and risked correspondingly huge amounts and put in huge amounts of work.
By analogy. Imagine a person who works and earns £40K a year. If you took 1000 such people, then between them they are earning £40 Million a year. If I then said something like, "Wow! £40 million?!?!? That's appalling! How can those people earn that much while others are on the breadline? We must tax it all to support society!', then I think you'd quickly point out the obvious flaw in my reasoning. But that's basically the same flawed logic Labour/the LibDems are usually using when they complain about large companies making large profits.
It's also often forgotten that large companies often allow more a career path than smaller enterprises. I know two people who started as front line chefs in big companies and now have significant management positions
If someone is being paid less than the value that their labour produces, and the money is going to the owner of the means of production, then their position being unable to afford (due to lack of capital) to purchase their own means of production is being exploited.
There are certainly issues, it's fairly common to see the US interfering with developing states that try and adopt socialist policies, and states that arise from violent revolution usually end up as militaristic dictatorships - regardless of if the revolution is capitalist or communist.
If you want examples of countries that have pulled themselves up with capitalism, Bangladesh and South Korea? The former went from 80% of the population in poverty to 13% today. Both appear to be fairly normal democracies.
Socialism is defined by the common ownership of the means of production. If most of your economy is privately owned companies, then it’s capitalism, even if you’re taxing the profits.
Common ownership can include things such as workers cooperatives, which we would consider a private enterprise. But an important point is that the fruits of production are distributed based on work done, rather than the basis of capital invested. Taxation and social programmes are one way of achieving this.
Why? Remember the profit is to a large extent a reward for taking the risk of investing in something that may fail and lose you all your money. But what risk are the employees taking? Even if the business makes a loss, they can still expect to be paid in full for the hours they put in. If they turn out to be unproductive and don't contribute to the business, then they are still paid in full for the hours they have put in (although the business might choose not to continue to employ them). They can also walk away at any time (subject to notice periods) while being paid in full for the hours they have put in.
The employees are (rightly) not expected to share in any losses the business makes. So why should they expect to share (beyond their normal salary) in any profits?
The big problem I have is certain businesses, particularly large corporations/banks, deciding they are too big to fail and demanding bailouts whenever things go wrong, even when they were making handsome profits before. The laws of capitalism state that businesses can go bust and if the demand is there for whatever product(s) they were selling, other opportunities will fill the gap. Now while I'm not an avid fan of capitalism, I prefer it being honoured properly than what has happened since 2008, where we unwillingly reward failure by socialising the losses; this is the worst of both worlds, and is a big driver of the rise in inequality and also populism in the world since.
The same of course happened with covid, where everything that was shut down was bailed out and Central Banks put their money printers on steroids, which has helped create the surge in inflation currently being felt (while Putin's antics have contributed, it's not the only factor and distracting from things like loose monetary policy is convenient for them), all while many of the restrictions were questionable regarding effectiveness and sustainability. It also happens with out utility companies, thinking Bulb especially.
In other words, if we go with capitalism we should let businesses boom AND bust, regardless of size. If society cannot handle the fallout that comes with a big bust, which seems to be what would have happened in 2008 without those bailouts, then it as a system is not fit for purpose, and we consider one of many possible alternatives (yes, economic systems are not a binary choice).
The statements "..Trans women are women.." and "..Trans men are men.." are simply statements of opinion and are not objectively proven scientific facts.
Scientifically, what does "woman" or "man" mean, given that they are concepts, as opposed to "male" or "female" which are defined using objective, testable characteristics?
Also, there's no such thing as a "scientific fact".
(Apologies if these points were raised in subsequent posts, I'm just getting caught up with the thread).
Just weighing in on this "why do I support/not support the Tory Party" discussion.
I've never voted for the Conservative Party and it's now exceedingly unlikely I ever will, given what's gone on in the past 7 years or so, and in particular the past 4. My main reason, I think, is that I strongly believe in State support of those in need, and that while individual responsibility is fine in many cases, there are many examples of people who get into bad circumstances through no fault of their own. Or, they succumb to such things as drugs and "bad people". Or they plain make bad decisions, which later they regret. Granted, you could argue that they shouldn't have tried the drugs in the first place, or been strong enough to resist the influence of the "bad people", or not made the bad decision, but it doesn't always work out like that. Things are more complicated than that. I have a strong view that people who mess up and then realise the error of their ways need to be supported. Or people who just encounter bad luck need to be supported. There's too much assumption in right-wing philosophy, IMO, that people on benefits for example are "scroungers" seeking to exploit the system. I first encountered this sort of attitude aged about 20 and I have been fervently against it ever since.
However, I do at least have respect for - while disagreeing strongly with - a small subset of right-wing views, mostly fiscal/economic ones rather than social ones. Namely, the theory that full privatisation brings better services than state-run services (I disagree with this, but I at least have some respect for this). And the related view that minimising public spending protects the economy (I am sceptical of this and dislike austerity intensely, but I at least respect it as a view, albeit one I fundamentally disagree with).
Thus, I have quite a bit of respect for such Tories and ex-Tories as, for example, Major, Ken Clarke and Heseltine. I have less respect for the likes of Cameron and Osborne but at least I don't see them as the devil incarnate.
Where the Tories start to annoy me though is with populist right-wing policies, such as flag-waving patriotism and anti-immigrationism. I have much less tolerance of that than the above, and if freedom is a stated aim, placing restrictions on immigration is actually completely at odds with one form of freedom. (I don't want to get into an argument about this yet again here - done that enough times already - though, I'm just identifying it as an issue I have with the right).
But more than that, with the current Tory party, is what I see as truly obnoxious behaviour and personal attacks made by senior Tory politicians. I'm thinking of the likes of Braverman, Anderson, Gullis and so on. I think it's completely unnecessary and really quite nasty for public figures to be personally attacking sections of the popluation they disagree with. I'm aware that back-benchers from both sides do this quite regularly but we're talking about senior figures here. If I am honest Lee Anderson in particular seems - to me - like a rather yobbish and thuggish figure, completely inappropriate for high office.
But there are a small number of current Tories - all back-benchers - I have some modicum of respect for due to them seeming to be reasonable people. Theresa May, for one, believe it or not. If the Tory party could "purge" the reactionary right-wing figures and become a moderate centre-right party (with people like May being typical figures) I'd have a lot less of a problem with it - though of course I would never vote for it. Right now it is adopting way too much of a reactionary and confrontational attitude. I'm also unconvinced (given the attack on the "woke" by senior figures) that it actually has that much respect, right now, for those of opposing views.
Basically the Tory party needs to drop the socially-conservative right-wing populism and antagonistic attitude to the liberal left, and focus on being a centre-right party, fiscally-conservative but socially-liberal. If it does that, I would still never vote for it (as I am not a fiscal conservative) but at least it would be taking it back to the Major or perhaps Cameron years when it wasn't apparently seeking to alienate much of the population.
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Apart from a few on the far left, Labour and the LibDems are also in favour of capitalism, but with more regulation that ought to make those downsides less likely. So citing capitalism as a reason to vote Tory suggests a preference for the Wild West variety they've recently preached and practised.
This. I would definitely class Labour and the Lib Dems in recent history as supporters of a form of capitalism, so claiming they're anticapitalist is false.
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I'd love to have a credible alternative as this gov't feels a bit "worn out" although Sunak is a big upgrade on his recent predecessors. Starmer is, of course, a far more grown up alternative than Corbyn ever was but whilst having flexible opinions is one of the advantages of opposition, his seems *particularly* flexible and it's hard to tell whether he's stringing-along the left to turn right on gaining power or vice-versa....
I think Starmer is deliberately keeping quiet and not rocking the boat on any issue in order to be as inoffensive as possible, and thus win. To me, appearing inoffensive and perhaps dull is likely to be a good plan for success right now given we've had to endure the opposite way too much in recent years.
Personally I hope he turns a little left on a number of issues on gaining power; I suspect he will be capable of bringing vastly improved relations with the EU for example but doesn't want to admit that right now for fear of alienating social conservatives who are considering switching from the Tories.
Correct for staff salaries. Dividends to shareholders aren't:
For a company, it's roughly: Net profit = all your income - salaries you pay - all your other expenses.
Once net profit is calculated, you pay a % of that to the Government as corporation tax.
Then out of what's left, you can choose to pay dividends to shareholders or use it to invest back in the business (or postpone the decision by just leaving the money in the bank account). Those are the only things you are legally allowed to do with the profits, after tax. (Note that if you pay dividends, the people who receive them will have to pay further income tax since their dividend income counts as income).
== Doublepost prevention - post automatically merged: ==
But those massive incomes/profits are usually only massive because of the size of the company. Proportionate to the amounts invested, the profits are likely to be much more reasonable: If a company has made £millions or £billions in profit, it's generally not because Mr. I'm-So-Lucky invested £100 and put in half an hours work and made £10 million. It's because lots of people between them invested and risked correspondingly huge amounts and put in huge amounts of work.
By analogy. Imagine a person who works and earns £40K a year. If you took 1000 such people, then between them they are earning £40 Million a year. If I then said something like, "Wow! £40 million?!?!? That's appalling! How can those people earn that much while others are on the breadline? We must tax it all to support society!', then I think you'd quickly point out the obvious flaw in my reasoning. But that's basically the same flawed logic Labour/the LibDems are usually using when they complain about large companies making large profits.
So it’s OK for companies like BP and Shell to rake in these profits because the general public don’t have any other choice but to buy from them in some way, and not expect to have to support the public when energy prices are through the roof?
Nah. They’re a big company. We’ll just pour more money into benefit fraud rather than tax fraud and get less for it.
So it’s OK for companies like BP and Shell to rake in these profits because the general public don’t have any other choice but to buy from them in some way, and not expect to have to support the public when energy prices are through the roof?
Nah. They’re a big company. We’ll just pour more money into benefit fraud rather than tax fraud and get less for it.
So it’s OK for companies like BP and Shell to rake in these profits because the general public don’t have any other choice but to buy from them in some way, and not expect to have to support the public when energy prices are through the roof?
Well in the particular case of oil companies, there's an issue of climate change and pollution, and that we should years ago have set up a tax regime to discourage fossil fuel extraction and encourage renewables, but setting that issue aside because it doesn't have anything to do with company profits per se....
Yes! It's perfectly OK for those companies to make those profits because they have made them in legitimate ways: By investing vast sums of money and risking losing that money, in order to provide us with the energy that we need, and providing a lot of jobs for people in the process. Why on Earth would anyone risk investing in a way that innovates and benefits us all if our reaction as soon as they are successful is to want to take all fruits of their endeavours away from them? If they earned those profits by acting properly, then they are entitled to those profits (subject to reasonable taxation), no matter how much you or I might enviously look at them and wish we could get some of that money. The only thing the Government needs to do is make sure that the market is working correctly, there is decent competition and the companies aren't developing into monopolies or abusing their power, etc. As long as the Government does that, it's unlikely in normal circumstances that profits will be unreasonable. And it may be counter-intuitive, but doing that is what ultimately gives us all the best overall standard of living.
The big problem I have is certain businesses, particularly large corporations/banks, deciding they are too big to fail and demanding bailouts whenever things go wrong, even when they were making handsome profits before. The laws of capitalism state that businesses can go bust and if the demand is there for whatever product(s) they were selling, other opportunities will fill the gap. Now while I'm not an avid fan of capitalism, I prefer it being honoured properly than what has happened since 2008, where we unwillingly reward failure by socialising the losses; this is the worst of both worlds, and is a big driver of the rise in inequality and also populism in the world since.
I can't recall the details of precisely how we bailed out the banks in 2008. However, I think the issue you point out is fixable. If a company is about to fail and is so large or important that it would cause the economy huge damage if it were to actually go bust, and it's therefore more in the country's interest to rescue it, then you probably want the Government to buy the firm up at market rates (which will be next to nothing if the firm really is about to fail, so the investors will still lose out), and then do whatever is necessary to make the firm viable again via an arms length publicly owned company (similar to the operators of last resort on the rail network).
I don't believe we bailed out the banks in 2008 out of any sense of wanting to help the investors or go against the market: It was more a case that, if we'd allowed those banks to go bust then the economic harm to the entire country would have been so great that it was perceived as being more in our interest to rescue them.
Yes! It's perfectly OK for those companies to make those profits because they have made them in legitimate ways: By investing vast sums of money and risking losing that money, in order to provide us with the energy that we need, and providing a lot of jobs for people in the process. Why on Earth would anyone risk investing in a way that innovates and benefits us all if our reaction as soon as they are successful is to want to take all fruits of their endeavours away from them? If they earned those profits by acting properly, then they are entitled to those profits (subject to reasonable taxation), no matter how much you or I might enviously look at them and wish we could get some of that money. The only thing the Government needs to do is make sure that the market is working correctly, there is decent competition and the companies aren't developing into monopolies or abusing their power, etc. As long as the Government does that, it's unlikely in normal circumstances that profits will be unreasonable. And it may be counter-intuitive, but doing that is what ultimately gives us all the best overall standard of living.
That's fair enough if a company has made an investment and taken a risk and it's paid off. Perhaps less so if they're making superprofits because the war in Ukraine sends prices way up through no action of their own. Yet when the public needs relief from those high prices, the government chooses to borrow from future generations instead.
No. It seems to me that the Left instigated the identity and associated culture wars when they started doing things like attacking our history, gratuitously looking for racism everywhere, attacking anyone who didn't agree with them on culture issues as some kind of something-o-phobe, etc.
They’re benefitting by being in paid employment; their wages/salary are deducted from their employers gross profit. Whether that remuneration is fair of course is another question!
Personally, I believe that if you’re in employment the reward should be such that you aren’t “just about managing” which is the idea of the living wage. I am however a firm believer in meritocracy in this context. If you possess skills, qualifications and experience that are relatively scarce and/or in demand, you can and should expect a higher level of remuneration than somebody who does not (which is basically how the labour market works under capitalism).
I should add however, that whilst I don’t believe in equality of outcome I firmly believe in equality of opportunity, and we’re falling down terribly in this regard. Far too many people simply aren’t given the chance to reach their potential. If you take the horse to water and it refuses to drink then fine, it’s a silly horse, but you do actually need to take it there in the first place!
The reality is that there'll never be equality of opportunity while the non-property owning classes (and I mean owning outright) have the risk of homelessness hanging over them and the propertied class doesn't.
Simply being born into wealth creates a vast inequality of opportunity
To me (explicitly from a centre-left viewpoint, but not myself part of any "minority") the distinction between the cultural attitudes of the left and the right is clear. The left is trying (sometimes imperfectly) to include social groups who have historically been discriminated against. But the right is trying to re-assert the dominance of groups that have been historically favoured, and indeed to aggravate the left and to shift the debate away from their major failings in governance and onto an issue where they can rile up their base vote. Very much out of the Trump playbook.
The reality is that there'll never be equality of opportunity while the non-property owning classes (and I mean owning outright) have the risk of homelessness hanging over them and the propertied class doesn't.
I agree, and there’s not much we can do about it other than allow those not born into wealth to create their own. That won’t lead to total equality of course, but as a conservative I think it’s the direction in which we should be heading, as opposed to stripping others of their wealth and “redistributing” it.
To me (explicitly from a centre-left viewpoint, but not myself part of any "minority") the distinction between the cultural attitudes of the left and the right is clear. The left is trying (sometimes imperfectly) to include social groups who have historically been discriminated against. But the right is trying to re-assert the dominance of groups that have been historically favoured, and indeed to aggravate the left and to shift the debate away from their major failings in governance and onto an issue where they can rile up their base vote. Very much out of the Trump playbook.
Speaking as a lifelong non-Tory voter, I think that's the thing. There are senior members of the government "woke-baiting" (my words), and using "racist rhetoric" (not my words, but those of Tory Sayeeda Warsi) right now, and for people in such a high-up, professional position that is unacceptable.
I'm not quite sure which one it is either! I tend to think both personally (as in ownership is an outcome but equally it improves your opportunities or those of your children if you have it). But I do think that @yorksrob makes a good point that for a lot of people their accommodation status is quite precarious which makes life that little bit harder. In the private rented sector you're typically only ever going to be around eight months from a potential eviction (fixed period for an Assured Shorthold is typically six months, Section 21 notice period is two months). Which makes it rather hard to feel that much security of tenure! Obviously some landlord might grant longer fixed term periods but on average the fixed term is only ever six months.
Personally one change I'd introduce would be to get rid of Section 21 "no fault" evictions (which the Government did promise, to be fair, to do but that was four years and three Prime Ministers ago and is still not even on the horizon) to at least start to restore some security of tenure for the ever increasing number of renters.
I agree, and there’s not much we can do about it other than allow those not born into wealth to create their own. That won’t lead to total equality of course, but as a conservative I think it’s the direction in which we should be heading, as opposed to stripping others of their wealth and “redistributing” it.
I suppose it depends on the nature of the "stripping" and redistributing. I'm not aware of anyone (serious, I'm sure there are nutjobs who would) in the Labour party or the wider left who are arguing in favour of breaking down doors and making off with paintings, jewellery and similar and then handing the cash over to poorer people. I do think there is some concern that in a world in which the average FTSE 100 CEO is paid 109 times more than the average UK worker we might have a problem with quite how the pie is distributed and perhaps there does need to be some work done on the whole redistribution angle. Though I'd be looking at taxation rather than breaking down doors!
Can you give examples of senior people on the left using "culture war" issues to bait the right, in the way some on the right seem to be doing to the left? I have no time whatever for Corbyn and his ilk, but I don't recall them behaving in that way.
To me (explicitly from a centre-left viewpoint, but not myself part of any "minority") the distinction between the cultural attitudes of the left and the right is clear. The left is trying (sometimes imperfectly) to include social groups who have historically been discriminated against. But the right is trying to re-assert the dominance of groups that have been historically favoured,
I wouldn't see it that way at all. Certainly the left thinks they are trying to include groups that have been discriminated against, but the way they are trying to do it is - to my mind - causing more harm than good and actually likely to increase rather than reduce discrimination. I don't oppose the kinds of cultural attitudes that have appeared on the left because I want to see some kind of dominance of certain groups: I don't want to see that. Rather, I oppose those attitudes precisely because I want to see an end to discrimination: I want to see everyone treated with equal respect irrespective of things like ethnicity, sexuality, beliefs, minority group status or otherwise, and I believe the 'left' approach to cultural issues is (unintentionally) doing the opposite.
and indeed to aggravate the left and to shift the debate away from their major failings in governance and onto an issue where they can rile up their base vote. Very much out of the Trump playbook.
I don't bring up culture war issues because I'm trying to shift the debate away from something else: I bring up those issues because they are of genuine and serious concern to me. I realise you probably didn't mean it in this way, but the sentence I've just quoted is to my mind an example of what people on the left constantly do: Try to ascribe bad motives to what people on the right say instead of accepting in good faith that we do and say things because we believe them. I'm happy to accept that you and people on the left genuinely disagree with me, while wanting a better society just as much as I do - and I don't understand why you're apparently not willing to give me (and people who believe as I do) the same consideration - as apparently illustrated by the above sentence.
The prime minister faces a declaration of interest inquiry over a childcare firm his wife has shares in.
www.bbc.co.uk
Prime Minister Rishi Sunak is being investigated by Parliament's standards watchdog over a possible failure to declare an interest.
Mr Sunak is being investigated over whether a declaration of interest was "open and frank", under rules set out by the commissioner for standards.
The BBC understands the probe relates to a childcare firm his wife has shares in.
The commissioner decides whether an MP has broken rules after an inquiry. This breaking news story is being updated and more details will be published shortly. Please refresh the page for the fullest version.
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