Some will have noted that the trolls were very active over the weekend, suggesting I had made a mistake in the video I put out on ’Welfare for the wealthy’. In it I said:

The interest rate went up from 0.1 per cent to 5.25 per cent. It's unusual for anybody to have earned 5.25 per cent on their deposits, of course, over that period. But real interest rates have risen from well under 1 percent in 2021 to over 4 percent still if you search around. In other words, the wealthy have benefited enormously from the welfare that has been provided to them by the Bank of England's benevolence, which is biased in their favour.

I thought that what I meant was unambiguously clear. My reference to ‘real’ interest rates referred to those actually on offer to real people in contrast to Bank of England base rates. It never occurred to me that anyone would interpret what I said in the context of the economic theory of ‘real’ interest rates, which compares those paid with the inflation rate.

I am, of course, familiar with that concept, much beloved by right-wing microeconomic fetishists who think the concept isat the forefront of the mind of all savers, none of whom should ever hold cash in their opinion because real rates, according to this theory, have been negative almost continuously since 2009 according to World Bank data.

Despite these people’s belief, in the real world , bank deposits remain as popular a mechanism for saving as ever and might have increased in value in real terms, just to prove that the claims of those rather desperate proponents of microeconomic theory are totally disconnected from the way real people actually behave.

I am only concerned in the videos I make, as well as in the posts here  (unless I make it very clear otherwise) with the economics of the real world. So, I use words with their normal usage as indicated by the context in which I use them. And if there are multiple meanings possible, then the right interpretation is invariably the one that common usage requires.

So why were the trolls so active? I think there could be two reasons. One is that the video series is proving very popular, especially on YouTube. That one has been viewed more than 9,000 times now, with a very high promotion watching it all the way through, which is rare on any video platform. Without any real narrative to address the issues I am raising of course they are being pedants.

The other is about framing.  They want debate on economics to be framed using the failed language and theories of the pseudo-science into which they have invested time and effort, even though it is very clearly incapable of explaining what is really going on in the world.

They are offended by my refusal to comply with their demand that I must frame things as they do, within the context of the rules that the lay down. I will not do that.

I will, instead, talk about what is very obviously happening in the real world where, for example,  real (nominal, paid, call them what you like, all terms refer to the sum actually paid) interest rates are very clearly distorting consumer behaviour patterns and spending power in favour of the wealthy, whatever their relationship with inflation. If they don’t like me noticing that because it offends their beliefs, tough luck. I do not share those beliefs. Nor do I think that much of their analysis stands up to scrutiny.

My delete button is going to see a lot of use if this trolling continues, because I am not going to bore people here with the nonsense these people talk.

As the Guardian notes this morning:

Unilever is to scale back its environmental and social aims, provoking critics to say its board should “hang their heads in shame”.

They added:

On Friday, the London-based firm’s current chief executive appeared to signal a strategic U-turn for the company, which is valued at £94bn on the London Stock Exchange. In an interview with Bloomberg, Hein Schumacher confirmed plans to water down the company’s ethical pledges on a range of issues including plastic usage and pay.

There really can be no surprise here. Labour is expected to win the first term of what many will think likely to be at least a two term government this year. They have abandoned their green commitments and budgets. Why wouldn’t business do the same?

Rachel Reeves should take note. Her decisions and smooching around the City have consequences. It is by no means clear that they are good.

Rishi Sunak has launched am attack on what he calls ‘the sick note culture’. I am, quite frankly, appalled.

Sunak is one of the richest men in the country. He has admitted that his family uses a private GP, let alone private healthcare for more complicated issues.

He is protected by privilege and wealth from the stresses that impact millions of people in the UK.

The possibility that a person might suffer stress as a consequence of their inability to work out where their child’s next meal might come from, or how they might keep a roof over their head, or how they might provide childcare when they go to their third job, which they have to take to meet the extraordinary increases in the cost of living imposed upon them by the Bank of England, or that they might be racked with guilt about their simple inability to provide for those about whom they care, is, I am quite certain, beyond his comprehension.

More than that, I doubt that he has even thought about the need to imagine it. In that case, of course he cannot see why those things that he calls the ‘ordinary stresses and strains’ of life might become, in themselves, totally incapacitating. It takes callousness on a considerable scale for anyone in his position to describe them as such, but that is what he has done.

Worse than that, fourteen years of Tory rule have created the healthcare crisis that we have.

Let’s leave aside the underfunding of the NHS, where funds provided have been insufficient to ensure that demand, not least for mental health services, can be met.

Let’s also leave aside the deliberate attack on the credibility and work ethic of NHS staff since 2021, in which he has played such a major role. Instead, let me just draw attention to other critical factors.

First, there is Covid. Sunak is a key player in the collective denial of the impact of this disease by his government and its predecessors since Boris Johnson decided to claim that its impact had effectively ceased from 2021 onwards.

That claim is complete nonsense. Not only do lots of people still get Covid, but it is as debilitating as ever, in many cases significantly threatening health well-being.

Covid is also a major secondary health risk. Increases in related illnesses, and in particular cardiac-related disease, are significant. The government is trying to pretend that none of this is happening.

Nor are they taking necessary action. For example,they are still doing nothing to provide a guarantee of clean air which is a precondition of good health. It could do that. Moreover, it has been shown that if it did so in school classrooms, where the spread of this disease is so easy, not only would we get major healthcare benefits, but the rate of learning amongst children would increase dramatically, improving education performance across the board. But his government does nothing, because it does not care.

Secondly, the age to which people are expected to work is now increasing. I might be in the fortunate position of being in good health and able to work to the capacity that I have delivered for many years at nominal retirement age, but I am well aware that this really is not normal. Vast numbers of people from their 50s onwards struggle with all sorts of well-being issues related to health that reduce their capacity to work, and too many employers know this and refuse to provide opportunity for those of older age.

Third, Sunak’s government has done nothing whatsoever to address the crises of diabetes, where the type two variant of this disease is entirely treatable. However, that is only possible if major changes in diet are made. This does, in particular, require dramatic reduction in the intake of sugar among the population as a whole, and a significant reduction in the consumption of ultra-processed foods. There is, nothing that could increase health in this country more than doing that, reducing both obesity related illnesses and type two diabetes hospital admissions as a result. Despite this, and despite the fact that this has been known for a very long time, his government has absolutely refused to address this problem. Instead, his health secretary is actually married to the boss of British Sugar. You could hardly make that up.

Then there is the assault on employment rights that this government encouraged. Its goal of a so-called ‘flexible workforce’ has been achieved at the cost of an enormous increase in insecurity for the majority of people in the country, who have suffered a reduction in their economic security as a consequence, giving rise to an increase in their stress. This now seems to have transferred into a widespread inability to work, so disabling is it.

There are, I am sure, other factors in play. But, these are sufficient to make it clear that if there is a responsibility for sickness in the UK then that belongs to Rishi Sunak and his predecessors and his colleagues in office since 2010. There is, quite literally, no one else to blame.

I have just posted this video on YouTube:

The link is here in case it is needed.

The transcript is:

Why is there no national insurance on investment income in the UK?

I can't explain that. If you work for a living, and most people watching this video will probably either have worked for a living before they're retired or will be working for a living now, you pay national insurance on your earnings.

Quite a lot of national insurance, in fact. Jeremy Hunt has reduced the rate to 8 per cent for most people at present, but it's still a significant additional to your tax.

However, if you live off rent, or if you live off dividends from companies, or interest on savings, or distributions from trusts that might be made to you by your benevolent great aunt Agatha, or on capital gains that you make on the profit from sale of assets - if you live off any of those things - you won't pay national insurance, because It doesn't apply to investment earnings.

So, as a result, people who have to live off earnings from employment pay a much higher overall rate of tax than do people who live off investment income.

Now, that makes no sense at all. In fact, for decades, we tried to make sure that the reverse was true. Then employment had a more favourable tax rate than income from investment did.

But we've reversed that and in the UK now we have this amazing situation where we have a bias in the tax system towards income from wealth.

We could solve that. It would be incredibly simple. If we charge what is called an investment income surcharge on income from investments, rents, dividends, etc., and we charge it at 15%, which would provide an approximation to both the employer's and the employee's rate of national insurance, which is overall paid on earned income, then we would create a level playing field between earned and unearned income.

And those with unearned income would have to pay a lot more tax.

If it was charged on income from unearned sources in excess of £5,000 a year, excluding pensioners who would be let off this charge, then we could raise £18 billion a year to redistribute inside the UK tax system to relieve poverty or to provide the investment we need in public services.

So why don't we do it? I don't know because it would be fundamentally fair if we did.

And please accept an apology: the last slide should say £18bn and not £10bn. We are still learning how to quality check these videos.

There is more on this in the Taxing Wealth Report 2024, section 6.2.