The Labour Party under Andy Burnham

[Tetchytyke]

What do BlackRock do with the money? Sit on it like it's a piece of art?

Mostly, yes.

Whether we like it or not there will always be wealthy people in society, remember some of those have worked very hard to get to where they are and it hasn't just fallen in their laps.

I wondered how long it would be before we got "you're just jealous" and "oh you just want communism lol". Can we have a proper discussion without using ridiculous strawmen please?

I have absolutely no issue with people being wealthier than me, just as I have absolutely no issue with me being wealthier than other people.

But the simple fact is that we are taxing valuable economic activity to absolute hell whilst we do not extend that same taxation style to capital and other assets. If we want to dig ourselves out of this mess then a tax on capital and other assets, especially land, is really the only way we're going to do it.

History shows us that you can't just keep screwing over the middle classes because it is the middle classes who drive revolution: the peasants are always revolting, but when the middle classes join the peasants then you're in trouble.

The biggest companies are now richer than many countries, and are consequently virtually untouchable. Many major areas of the worldwide economy are now controlled by one or a handful of mega-corporations.

90% of the world's grain supply is controlled by just four companies- Archer Daniels Midland, Bunge, Cargill, and Louis Dreyfus, known collectively as the ABCD- and most people haven't heard of any of them.

This has always been the real issue with unbridled capitalism. Competition means that you have a winner and a loser, and the winner just hoovers up all the losers until they control everything.

What we're also seeing is the increased financial leveraging of essential commodities. It isn't enough now for the ABCD to buy some grain and sell it for a profit. Commodities traders now trade complex financial instruments- instruments that I certainly don't understand- and they make their money by manipulating the supply and price of commodities rather than simply buying some grain from a farmer and selling it to a flour mill for a bit of a profit. Meanwhile, people starve.

 

[Richard Scott]

The main issue is when capitalism evolves into corporatism, which is what we now have. The biggest companies are now richer than many countries, and are consequently virtually untouchable. Many major areas of the worldwide economy are now controlled by one or a handful of mega-corporations.

Even Adam Smith recognised the need for competition and regulation. Too little of both is why we are where we are now.

Problem with regulation is you'll never impose it on Chinese (or some other companies based in other countries) and they're expanding at quite a rate.
How do we deal with that situation? I don't know the answer but if we regulate our own industries just for them to be swallowed up by a Chinese company then where do we go?
Seems government not interested in preventing buy outs, if indeed that's possible to do?

 

[Tetchytyke]

It isn't, just making the point that even if you take it to the extreme there's no sustainable solution.

There's no one ideological right answer, you need a bit of everything.

Command economies haven't really worked, but then unbridled capitalist economies haven't really worked either.

 

[Richard Scott]

I wondered how long it would be before we got "you're just jealous" and "oh you just want communism lol". Can we have a proper discussion without using ridiculous strawmen please?

I have absolutely no issue with people being wealthier than me, just as I have absolutely no issue with me being wealthier than other people.

Just pointing out that no matter what we try someone always comes out on top.
I don't see the problem as they spend money on items that keep others employed.
It is a proper discussion not ridiculous strawman argument. Used the idea of communism as that doesn't stop some people gaining wealth either so no matter what we do there is no one size fits all way of doing things.

 

[Yorkshire09876]

90% of the world's grain supply is controlled by just four companies- Archer Daniels Midland, Bunge, Cargill, and Louis Dreyfus, known collectively as the ABCD- and most people haven't heard of any of them.

This has always been the real issue with unbridled capitalism. Competition means that you have a winner and a loser, and the winner just hoovers up all the losers until they control everything.

Yep, hence the need for regulation, which includes stopping any individual companies from getting so big that they become a monopoly or part of a quasi-cartel.

Similar applies in the IT field, which is now essential for pretty much every form of economic activity or communication. Cloud hosting is controlled by Amazon, Microsoft and to a lesser extent Google. Desktop operating systems / office software is mostly Microsoft. Computer and phone hardware is a small group of companies. It's nearly impossible for new entrants to succeed in any of these areas now as the competitors are too large and powerful and can squash any challengers.

 

[brad465]

There's no one ideological right answer, you need a bit of everything.

Command economies haven't really worked, but then unbridled capitalist economies haven't really worked either.

The Cold War was essentially two extremes that were both destined to fail. Communism falling first wrongly vindicated unbridled capitalism. The latter arguably failed in 2008, and has since been propped up like a zombie ever since, because certain interests can't bear to let it go.

 

[Yorkshire09876]

Just pointing out that no matter what we try someone always comes out on top.

Yes, but at no time in history has there been a situation where some people are as obscenely wealthy as now, with far more stashed away than they can ever spend.

Varying wealth levels are fine, but not the sort of disparity which exists now.

== Doublepost prevention - post automatically merged: 30 Oct 2025 ==

Problem with regulation is you'll never impose it on Chinese (or some other companies based in other countries) and they're expanding at quite a rate.
How do we deal with that situation? I don't know the answer but if we regulate our own industries just for them to be swallowed up by a Chinese company then where do we go?
Seems government not interested in preventing buy outs, if indeed that's possible to do?

Appropriate import tariffs, and restrictions on foreign ownership of UK companies, would be a good start.

It is possible for the government to do anything as they make the laws and no government can bind a future one. More a case that they don't want to!

 

[Tetchytyke]

Just pointing out that no matter what we try someone always comes out on top.
I don't see the problem as they spend money on items that keep others employed.

Someone will always have more, someone will always have less. Such is life.

The problem is that our current taxation model punishes those engaged in activity which increases our economic output. You make a widget and it's taxed, you sell a widget and it's taxed, you employ someone to help you make and sell a widget and it's taxed. But we need people making widgets and selling widgets and buying widgets to have a functioning economy.

Meanwhile our current taxation model rewards those who are not engaged in activity which increases our economic output. Landlordism is an inherently parasitic activity- other people do the work and you just take a rent off them- yet landlordism is not taxed accordingly. Landlordism is also inherently based on inherited wealth rather than any sort of capitalistic talent- the Duke of Westminster is one of the UK's richest men simply because his great-great-great-great-great-grandfather was a bit of a ******* back in the time of William the Conqueror. His income solely comes from the fact he owns half of the land in London. He doesn't contribute anything to our economy, he just takes money off the people who do contribute to our economy.

I don't know how we'd create a taxation structure that would target this sort of deep-seated capital, but we can't go on how we are.

 

[Bantamzen]

Someone will always have more, someone will always have less. Such is life.

The problem is that our current taxation model punishes those engaged in activity which increases our economic output. You make a widget and it's taxed, you sell a widget and it's taxed, you employ someone to help you make and sell a widget and it's taxed. But we need people making widgets and selling widgets and buying widgets to have a functioning economy.

Indeed that's the real problem, we don't make widgets any more. We instead have lots of people telling us what the widgets should look like, other people speculating what the widgets should cost, people advertising the widgets, and of course people actually selling the widgets. Just not a lot of people making them.

If we actually found a niche in the widget market, something we could build on, we'd be onto something. We could even cut out out some of the middle widget-people and go from production straight through to sales, creating widget building jobs, creating more tax income. And if we really put our back into it, encourage future generations to be widget builders and designers instead of accruing tons of student debt for a qualification worth less than the paper it's printed on, we might even be able to become major exporters of the widgets we design and build, bringing in even more money.

Meanwhile our current taxation model rewards those who are not engaged in activity which increases our economic output. Landlordism is an inherently parasitic activity- other people do the work and you just take a rent off them- yet landlordism is not taxed accordingly. Landlordism is also inherently based on inherited wealth rather than any sort of capitalistic talent- the Duke of Westminster is one of the UK's richest men simply because his great-great-great-great-great-grandfather was a bit of a ******* back in the time of William the Conqueror. His income solely comes from the fact he owns half of the land in London. He doesn't contribute anything to our economy, he just takes money off the people who do contribute to our economy.

I don't know how we'd create a taxation structure that would target this sort of deep-seated capital, but we can't go on how we are.

I'm not so sure taxing landlords will help, when landlords will just pass that cost straight down the line. And indeed this is the problem with more and more tax, someone ends up paying it, and it's usually either the public or the people working for those incurring extra tax. It's an exercise in deck chair shuffling. Future solutions are going to need for us to invest in the future, not simply pass around existing deficits.

 

[brad465]

Indeed that's the real problem, we don't make widgets any more. We instead have lots of people telling us what the widgets should look like, other people speculating what the widgets should cost, people advertising the widgets, and of course people actually selling the widgets. Just not a lot of people making them.

If we actually found a niche in the widget market, something we could build on, we'd be onto something. We could even cut out out some of the middle widget-people and go from production straight through to sales, creating widget building jobs, creating more tax income. And if we really put our back into it, encourage future generations to be widget builders and designers instead of accruing tons of student debt for a qualification worth less than the paper it's printed on, we might even be able to become major exporters of the widgets we design and build, bringing in even more money.

The best description I can recall of the UK economy was something like "the UK economy is a housing market with a financial services' sector existing to support said housing market."

If we are going to have our own industries that we specialise in, ideally we also need rules that ban them from being foreign-owned and/or bought out by foreign entities, especially private equity. This may come with its own problems though.

 

[Yorkshire09876]

I'm not so sure taxing landlords will help, when landlords will just pass that cost straight down the line.

It would only work if applied in conjunction with rent controls on private letting.

And you can just imagine what the Daily Mail would make of any proposal along those lines!

 

[Bletchleyite]

It would only work if applied in conjunction with rent controls on private letting.

And you can just imagine what the Daily Mail would make of any proposal along those lines!

In effect the new rent tribunals are a form of rent control, albeit a crude one. So that's already here!

 

[Yorkshire09876]

In effect the new rent tribunals are a form of rent control, albeit a crude one. So that's already here!

Can't say I have any expectation that those will be effective - looks more like a 'be seen to be doing something' step.

 

[JonathanH]

If we are going to have our own industries that we specialise in, ideally we also need rules that ban them from being foreign-owned and/or bought out by foreign entities, especially private equity. This may come with its own problems though.

Ultimately they have to be foreign owned eventually as otherwise we don't have money to pay for the imported goods we all like to buy without more debt. We can only sell our means of production in exchange.

 

[RT4038]

Can't say I have any expectation that those will be effective - looks more like a 'be seen to be doing something' step.

Probably as effective as the previous effort (in the 50s/60s), which shrunk the private rental sector to nothing.

Ultimately they have to be foreign owned eventually as otherwise we don't have money to pay for the imported goods we all like to buy without more debt. We can only sell our means of production in exchange.

Well exactly. Living beyond our means.....

 

[Yorkshire09876]

Probably as effective as the previous effort (in the 50s/60s), which shrunk the private rental sector to nothing.

Not going to happen now. House prices relative to wages bear no resemblance to the 50s/60s and there are a lot more people who cannot afford to buy so will be renting (in some cases in shared houses and/or paid partly or wholly with benefits).

And a tribunal will only be able to compare rents with others for similar properties in the same area, so in areas with sky-high rents (especially London) high rents will be regarded as reasonable.

 

[Bletchleyite]

Probably as effective as the previous effort (in the 50s/60s), which shrunk the private rental sector to nothing.

A big reduction in the private rental sector would be a good thing; that would mean more houses on the market to purchase and perhaps a price reduction because homes would no longer be an investment but simply something you bought to live in, as they should be.

 

[JonathanH]

A big reduction in the private rental sector would be a good thing; that would mean more houses on the market to purchase and perhaps a price reduction because homes would no longer be an investment but simply something you bought to live in, as they should be.

If we could apply a significant correction to the housing market, there would be a lot of ordinary people in negative equity, which is somewhat awkward. Also, a continued reduction in home prices calls into question whether anyone should buy a home, as deflation would mean it would be cheaper in the future.

While there have been calls to reduce the private rental sector, it isn't clear what it achieves if the supply of rental properties reduces. Government confiscation of all property other than primary dwelling place is an option to create a state run housing service, but I'm not convinced that is tenable.

Should house prices be frozen at current prices, or those from twenty years ago?

 

[Bletchleyite]

If we could apply a significant correction to the housing market, there would be a lot of ordinary people in negative equity, which is somewhat awkward.

It's happened before and the world didn't end. Negative equity is only a problem if you need to sell, if you're wanting to continue living in the home it's fine. If you buy a house to live in it and don't intend to sell it its value is of no consequence whatsoever other than that Daily Mail readers love bleating about it.

 

[JonathanH]

It's happened before and the world didn't end.

True, but clearly it caused anguish, and it affects the young disproportionately more than the old.

 

[Bletchleyite]

True, but clearly it caused anguish, and it affects the young disproportionately more than the old.

A considerable reduction in house prices would be of benefit to a far wider range of the young than it would harm.

 

[JonathanH]

A considerable reduction in house prices would be of benefit to a far wider range of the young than it would harm.

Clearly it would benefit those who haven't bought a home, and penalise those who have just taken out a mortgage to buy one.

 

[SargeNpton]

So, Rachel Reeves...

48 hours of the government saying "Nothing to see hear" followed by her falling on her sword; or will she survive?

 

[brad465]

So, Rachel Reeves...

48 hours of the government saying "Nothing to see hear" followed by her falling on her sword; or will she survive?

It hasn't been 48 hours, that story came out yesterday evening. I think it could go either way; Rayner obviously didn't survive, however Jess Phillips was the centre of a sudden exodus of grooming gang enquiry participants and demands to step down, yet she's still there and that story has all but gone.

If she does go the budget will almost certainly be postponed, as the successor will not have time to prepare for it next month. On the one hand this is good for the government as an unpopular budget could easily be changed under the guise of a new chancellor, but the uncertainty would upset the markets.

 

[Tetchytyke]

I'm not so sure taxing landlords will help, when landlords will just pass that cost straight down the line.

Maybe they will, maybe they won't, it depends on what the market will bear.

I'm thinking of far more than just residential private lettings though. The office I work in is rented from a large private company. They don't actually do anything for the money- my employer is responsible for all maintenance in the office- but they take significant money from my employer. It possibly suits my employer to not own the building, but its still a fiscal drag on my employer.

We see it with shops, the rents being charged by commercial landlords often being cited as the biggest overhead shops face. Charging business rates on empty properties can sometimes help with this but the rules are full of holes, hence the never-ending succession of American sweet shops and knock-off Harry Potter shops on every high street in the country.

As I say, I don't really know how we'd start to tax this hoarded capital effectively, but something has to give.

== Doublepost prevention - post automatically merged: 30 Oct 2025 ==

48 hours of the government saying "Nothing to see hear" followed by her falling on her sword; or will she survive?

I think she'll survive, it's a nothing of a story. She forgot to get the right permit for a specific part of London. Meh.

I don't like her one little bit, but if this is all they have to go on with her then nothing much will happen.

Given the extensive property portfolios of many Conservative MPs, and given their opposition to these sorts of council rules, they probably can't fling too much mud.

 

[Yorkshire09876]

A considerable reduction in house prices would be of benefit to a far wider range of the young than it would harm.

The housing market is a bubble, and governments have made every attempt to stop it deflating. Sooner or later it's going to burst, and the longer it's propped up before it does, the worse the outcome is likely to be.

 

[Falcon1200]

Off topic but actually you don't pay Scottish tax rates on your taxable savings income

Thanks, I feel a little better!

I think she'll survive, it's a nothing of a story. She forgot to get the right permit for a specific part of London. Meh.

Which demonstrates her general level of (in)competence.

Given the extensive property portfolios of many Conservative MPs, and given their opposition to these sorts of council rules, they probably can't fling too much mud.

Imagine the mud Labour would throw at an evil greedy Tory landlord in a similar position.....

 

[brad465]

The letting agency has all but taken responsibility, so unless the emails being published of the exchange have some contradictory revelations, she's probably safe for now:

Rachel Reeves: Letting agent apologises to chancellor for not applying for rental licence

The agent says "we deeply regret the issue caused to our clients"; Reeves says in a new letter to the prime minister: "I accept it was our responsibility to secure the licence".

www.bbc.co.uk

Reeves 'would have been under the impression that a licence had been applied for' - estate agent
​

We've just heard for the first time from the letting agency which oversaw the renting out of Rachel Reeves' former family home.

They were previously declining to comment but Gareth Martin, owner of Harvey Wheeler, has now released a statement - here it is in full:

"We alert all our clients to the need for a licence. In an effort to be helpful our previous property manager offered to apply for a licence on these clients' behalf, as shown in the correspondence.

"That property manager suddenly resigned on the Friday before the tenancy began on the following Monday.

"Unfortunately, the lack of application was not picked up by us as we do not normally apply for licences on behalf of our clients; the onus is on them to apply.

"We have apologised to the owners for this oversight.

"At the time the tenancy began, all the relevant certificates were in place and if the licence had been applied for, we have no doubt it would have been granted.

"Our clients would have been under the impression that a licence had been applied for. Although it is not our responsibility to apply, we did offer to help with this.

"We deeply regret the issue caused to our clients as they would have been under the impression that a licence had been applied for."

 

[Snow1964]

Rachel Reeves might be under impression licence was applied for, but clearly didn't check.

If you or I tried that excuse with TV licence or provisional driving licence etc. then went ahead anyway, wouldn't really be able to claim did nothing wrong.

 

[KevinBrum12]

Reeves will ride this one out. It is in the interests of Starmer to let her deliver what will be an unpopular budget and Starmer will do the same trick Major pulled, replacing a reviled, tax raising VATman Chancellor in Norman Lamont with an individual with better political antennae and a sense of humour like Ken Clarke.