The Rich, The Poor, Tax and Land Wealth

People on the Left often come up with the statistic that poorer people pay more tax the richest in society. This is true to an extent, but it masks the fact that the poorest in society also receive money back from the state via benefits and tax credits. I made this point in a video:

However, since making this video, I came across a chap called Fred Harrison who has written an excellent blog and made a couple of videos on how the richest in society derive huge wealth from their land wealth. And this wealth has nothing much to do with their own efforts and everything to do with public investment.

“PEOPLE whom they brand as “benefit scroungers” are routinely ridiculed by sections of the media. Television companies even make documentaries about people who should not qualify for tax-funded benefits. But the luckiest scroungers of state largesse – I am one of them – are never held to account for the money they pocket from the public purse. That is because the scam is lawful.

The scam is a legacy of a bygone age of irresponsible governance. We do not talk about it because the debate about the housing crisis is distorted by notions such as “hard-working middle class home-owners”. But if we continue to advocate the need to “get on the housing ladder”, there is no chance of solving the problem of unaffordable housing.

At the heart of the crisis is the way government raises and spends our money. Let’s examine the covert way in which tax policy interfaces with the housing market, and one of the techniques for distracting us from the biggest financial scandal facing the nation.

The Taxpayers’ Alliance (TPA), a libertarian champion of taxpayers, wants government to reduce its tax-take. To argue its case, it points out that the average household in the top 20% of income earners will pay more into the public purse than any other group of people. And we are expected to believe that this is “progressive taxation”. It’s fair that the rich should pay the most into the public purse – right? An individual within the top 20% bracket will pay, on average, £1,686,970 in tax over his working lifetime.1 The calculation is based on Office for National Statistics data for 2016.

But the TPA does not reveal that high-tax payers are the nation’s biggest winners from the State’s handout of benefits. By following the money trail, we discover that the public services they enjoy are funded out of the pockets of low-income families. I will illustrate this tax-scam with an example taken from London.

According to the estate agency Rightmove, terraced properties in London’s Kensington had an average sold price of £4,507,685 in the 12 months to August 2016. Semi-detached properties averaged £7,633,846. What does that mean for the owner of a (say) £5m residential property, who would be in the top 20% income bracket? With house prices rising at conservatively estimated rates of increase between 2017 and 2021 (with a weakening of prices in 2019), I estimate that the value of that £5m dwelling will increase by about £1,700,000. In other words, the average high-income taxpayer will be reimbursed for his whole lifetime tax liabilities in five years flat!

Who reimbursed him with those windfall capital gains? Father Christmas? An alchemist holed up in a cave in the Swiss Alps who splays out the riches that come cascading down from the heavens and into the pockets of the owners of residential property?

No. Capital gain measures the value of the location occupied by the house, the value which government fails to collect to defray the cost of the services it delivers. It is the subsidy to property owners for which there is no means test.

The family occupying that £5m house in Kensington will enjoy access to public services which are funded, in part, by low-income taxpayers who live in rented accommodation.

This State-sponsored device for making the rich richer (and the poor, poorer) means that, for most of their lives, rich folk enjoy public services without paying for them. I first spelt out the economics of this scam in 2006. Governments turn a blind eye to the injustice while wringing their hands in despair at not being able to deliver affordable housing to people on the lowest incomes.”

High Testosterone Fuels Violent Black Crime?

Testosterone Fueled? 17-year-old Blaise Lewinson brutally hacked another 17 year old to death in 2016
Testosterone Fueled? 17-year-old Blaise Lewinson brutally hacked another 17 year old to death in 2016

Warrior Gene Recap
Before discussing testosterone, let’s recap a recent video I did on the so-called Warrior Gene. People with this gene are more likely to exhibit violent and aggressive behaviour but this is most strongly seen in situations where they are provoked. Studies have also shown that anti-social behaviour amongst adult men with this gene is more likely if they were mistreated or punished violently in childhood. Surveys have shown that African Americans are more likely to physically punish their children, and black people tend to live in inner city areas where provocation and threat is much more likely than in other areas. So, it’s not a surprise that African American with this gene were more likely to have been involved in violent crime involving guns and knives, because they are probably more likely to have been beaten as children, and to live in inner city areas.

Testosterone and Black Crime
A very similar picture can be seen with regard to testosterone. Testosterone is the primary male sex hormone which is necessary for a huge amount of basic physiological and psychological functions. But it also seems to correlate with violent and aggressive behaviour. So could it be that black men have higher levels of testosterone, and could this be a factor in the apparent higher levels of violent crime in black communities in the US and UK?

From the evidence that I’ve seen, black men don’t necessarily have a greater innate ability to generate testosterone compared to men of other groups. Over the years, a few studies have recorded higher testosterone levels in black men than men of other races.  But I think there are some behavioural and environmental factors which mean black men tend to have higher levels of testosterone. A number of studies have found that testosterone levels in men rise in anticipation of competition and contests. This has led several scholars to argue for something called The Challenge Hypothesis. Basically, the idea is that men who reside in socio-cultural contexts where there are regular threats to their well-being and social standing tend to produce higher testosterone levels in order to prime them for conflict. This idea is supported by a study which found that when comparing young white and black men with no education above high school level, the testosterone levels among black men was significantly higher than the white men. But among older men or better-educated men, race made little difference in hormone levels.

Testosterone + Ghetto Living + Warrior Gene
What we’re seeing is a vicious cycle. The overly violent environment stimulates elevated testosterone levels among young boys and men in these inner city areas, which in turn leads to more aggression and violence. Add to this mix the Warrior Gene and it’s even more grim. Black men are are more likely to carry the Warrior Gene which means they have less control over the neurotransmitters which trigger aggressive behaviour. Indeed, I’ve seen one study which found that high levels of testosterone only correlated with aggressive behavior in the men if they also carried the Warrior Gene.

Get Out of the Ghetto 
What would my policy recommendations be in response to all of this? Well, on an individual and family level, black people should do everything they can to keep their families intact so as to provide as strong a insulator against the negative impact of the inner city as possible. This includes refraining from having children until we are absolutely sure we can provide them with the support and love they need. Also on a micro level, I think black people should seriously consider pulling out all the stops to leave these inner city areas. More widely, black people need to wage a culture war against all of the negative crap that is spewing out in the music, on social media and elsewhere. The WorldStar effect needs to be counteracted and a new black identity needs to be built, one which is founded on family values, hard work, discipline, aspiration, etc.  And on the macro level, everyone needs to promote the kinds of local and national government policies that deal with the structural causes of inner city degradation.

A longer and fully referenced video will be made available to my Patreon supporters so head over there and join the club! https://www.patreon.com/aTalkingDude