British lawmakers on Tuesday rose up against Prime Minister Boris Johnson, moving to prevent him from taking the country out of the European Union without a formal agreement. The epic showdown has Britain on the verge of a snap general election.
After losing his first-ever vote as prime minister, Mr. Johnson stood up in Parliament and said he intended to present a formal request for an election to lawmakers, who would have to approve it.
A little over a month ago, Mr. Johnson, a brash, blustery politician often compared to President Trump, swept into office with a vow to finally wrest Britain from the European Union by whatever means necessary, even if it meant a disorderly, no-deal departure.
Now, Parliament has pulled the rug out from under him, and Mr. Johnson is at risk of falling into the same Brexit quagmire that dragged down his predecessor as prime minister, Theresa May.The lawmakers forced his hand by voting by 328 to 301 to take control of Parliament away from the government and vote on legislation as soon as Wednesday that would block the prime minister from making good on his threat of a no-deal Brexit.
That prompted an angry response from the prime minister.
“I don’t want an election, the public don’t want an election, but if the House votes for this bill tomorrow, the public will have to choose who goes to Brussels on Oct. 17 to sort this out and take this country forward,” Mr. Johnson said, referring to the next European Union summit.
Tuesday was a critical moment in Britain’s tortured, three-year effort to extract itself from the European Union. The saga has divided Britons, torn apart the ruling Conservative Party and prompted complaints that Mr. Johnson has trampled the conventions of the country’s unwritten constitution.
A majority of lawmakers are determined to block a withdrawal from the European Union without a deal, which they believe would be disastrous for the country’s economy. Tuesday’s vote suggested they have the numbers to succeed.
Mr. Johnson’s aides had made clear that, in the event of a defeat on Tuesday, he would seek a general election on Oct. 14 — just a little over two weeks before the Brexit deadline of Oct. 31.
The accelerating pace of events suggests that Britain’s Brexit nightmare may finally be approaching an endgame after years of paralysis.
Tuesday’s vote also marked the moment when Mr. Johnson’s hardball tactics, for once, were met with equal resistance.
On a day of high drama, Mr. Johnson lost his working majority in Parliament even before the vote took place, when one Conservative rebel, Phillip Lee, quit the party to join the Liberal Democrats, who have managed to stage a resurgence by positioning themselves as an unambiguously anti-Brexit party.
The practical effect of Mr. Lee’s defection for Mr. Johnson was limited, however, because the government would fall only if it were defeated in a confidence motion.
But in moment weighty with symbolism, Mr. Lee walked across the floor of the House of Commons and sat beside Jo Swinson, the leader of the Liberal Democrats, as the prime minister was speaking about the recent Group of 7 summit. Mr. Lee accused Mr. Johnson of pursuing a damaging withdrawal from the European Union in unprincipled ways, and of “putting lives and livelihoods at risk.”
Mr. Lee’s break with the Tories was most likely just the first of many.
On Tuesday, Downing Street said it would press ahead with plans to discipline those rebels who voted against the government by expelling them from the Conservative Party in Parliament. They include two former chancellors of the Exchequer, Philip Hammond and Kenneth Clarke, and Nicholas Soames, the grandson of Winston Churchill.
That could threaten Mr. Johnson’s ability to manage day-to-day business in Parliament, underscoring the need for a new election.
The extent of the Tory civil war was on full display as several of Mr. Johnson’s Conservative critics, including the former chancellor of the Exchequer, Philip Hammond, lobbed hostile questions at him, making it plain that they had not been brought back into line by threats of expulsion from the party.
Opponents of a no-deal Brexit argue that Mr. Johnson’s promise to leave the bloc without a deal, if necessary, would be catastrophic for the British economy. Many experts say it could lead to shortages of food, fuel and medicine, and wreak havoc on parts of the manufacturing sector that rely on the seamless flow of goods across the English Channel. Leaked government reports paint a bleak picture of what it might look like.
Mr. Johnson says he needs to keep the no-deal option on the table to give him leverage in talks in Brussels, because an abrupt exitwould also damage continental economies, if not as much as Britain’s. The prime minister appealed to his own lawmakers not to support what he called “Jeremy Corbyn’s surrender bill,” a reference to the leader of the opposition Labour Party.
“It means running up the white flag,” he said.
Mr. Johnson also claimed to have made progress in talks with European Union leaders, although his own Brexit secretary, Stephen Barclay, on Monday gave a much less rosy assessment of the state of negotiations.
Britain’s main demand is for the European Union to ditch the so-called Irish backstop, a guarantee that the bloc insists it needs to ensure that goods flow smoothly across the Irish border whatever happens in trade negotiations with Britain. Mr. Johnson said he planned to visit Dublin next week for talks with his Irish counterpart, Leo Varadkar.
Conservative rebels believe Mr. Johnson is more interested in uniting Brexit supporters behind him ahead of a general election than in securing an agreement in Brussels.
One former chancellor of the Exchequer, Kenneth Clarke, accused Mr. Johnson of setting impossible conditions for the negotiations, attaching as much blame as possible to the European Union for the failure to get a deal and then seeking to hold a “flag-waving election” before the disadvantages of leaving without an agreement become apparent.
The bitter dispute has taken Britain into new political territory.
Last week, Mr. Johnson provoked outrage by curtailing Parliament’s sessions in September and October, compacting the amount of time lawmakers would have to deal with the most crucial decision the country has faced in decades.
Mr. Johnson’s allies argue that it is the rebels who are subverting the principles of Britain’s unwritten constitution by seizing control of the proceedings of Parliament that are normally the preserve of the government.
The European Commission said on Tuesday that while the frequency of meetings between its Brexit team and the British negotiator, David Frost, had increased, little headway had been made toward avoiding a hard border between Ireland and Northern Ireland.
Asked whether the British government was using reports of its talks with the commission for political purposes at home, the commission’s spokeswoman, Mina Andreeva, said that the body was “an honest broker, as always.” She said she could not “report any concrete proposals having being made that we have seen.”
Mr. Hammond, a senior member of the cabinet two months ago, told the BBC on Tuesday that Mr. Johnson’s claim of progress on the negotiations was “disingenuous.”
To add to the turmoil and confusion, the opposition Labour Party suggested it might thwart Mr. Johnson’s attempt to push for a general election, should it come to that. Under a 2011 law, the prime minister needs a two-thirds majority to secure a snap election, although it is possible that the government might try to legislate to set that provision aside, a move that would mean it needs only a simply majority.
There is so little trust in British politics that Mr. Johnson’s opponents fear that he might request an election for Oct. 14 but then switch the date until after Oct. 31 as part of a move to lock in a no-deal withdrawal.
Labour has said that its priority is to stop Britain leaving the European Union without a deal, because of concerns about what such a departure would mean for the economy.
But Labour’s stance underscores that the backdrop to everything in British politics is a sense that a general election is looming, with key players maneuvering for the most advantageous moment.
Their response is disingenuous. They focus most of their fire on what they label as our revenue estimate: that the proposed wealth tax would raise $25 billion annually, rather than the $187 billion they estimate. In reality, we are explicit that $25 billion is a rough back-of-the-envelope number and state that “We would be surprised if the $25-billion-a-year figure we suggest was not a significant underestimate of the revenue potential of a 2 percent wealth tax.” The purpose of our piece was not to provide an alternative revenue estimate for the wealth tax but to call into question the naively high estimate provided by Saez and Zucman.
.. As we explain at some length in our piece, naive estimation of the kind offered by Saez and Zucman tends to be way optimistic relative to scorekeeping by government experts. This point is well illustrated by the difference between academic and government estimates of taxing carried interest as ordinary income or of the value-added tax. Nothing in Saez and Zucman’s response suggests they are immune from this problem.
They attempt a broad allowance for tax avoidance, assuming the rich would successfully shelter at most 15 percent of their wealth from taxation. They base this guess on four academic studies that consider the international experience of wealth taxation, which find that a 1 percent wealth tax reduces reported wealth by 0.5 and 35 percent, which they simply average to 15 percent. But this strikes us as too low.
First, Saez and Zucman’s interpretation of the international experience differs from ours. They rely on estimates suggesting that a 1 percent wealth tax in Denmark and Sweden results in evasion of less than 1 percent (which makes their 15 percent estimate look huge). But in both countries, wealth taxation proved so easy to avoid and so difficult to administer that these taxes were repealed. In fact, of the 12 nations in the Organization for Economic Cooperation and Development that had wealth taxes in 1990, only three still have them today.
Second, the estate tax is informative on the potential magnitude of wealth tax evasion. Let’s consider Saez and Zucman’s estimated tax base for people with wealth greater than $50 million: about $9.3 trillion in 2019. If we were to apply the current 40 percent estate tax to this figure — assuming 2 percent of those families will experience a death this year (a conservative estimate) — we would expect that tax to generate about $75 billion this year. And if we apply the effective estate tax to that figure (accounting for charitable contributions and spousal bequests), it would raise $25 billion this year. In reality, the estate tax will raise about $10 billion from estates of more than $50 million this year. In other words, it seems plausible that tax avoidance is closer to 60 percent.
It is worth noting that estimating the tax base for those worth more than $50 million in itself is a difficult task — let alone estimating the revenue that taxing these households can raise. Different approaches to measuring top wealth can paint very different pictures. And the numbers reported in the Forbes 400, which Saez and Zucman rely on repeatedly in their rejoinder, are thought of by many as dubious.
This isn’t to say that our method should be viewed as definitive, but it does suggest the Saez and Zucman estimation is likely too high. As an illustration of the crudity of their analysis: They neglect to contend with behavioral responses that would inevitably follow a 2 percent tax on a small group of wealth holders. For example, there would be a significant incentive to accelerate charitable giving, which would decrease the wealth tax base. It seems important to account for the fact that the wealthy (and their tax planners) will inevitably be motivated to limit tax liability.
Saez and Zucman are at pains to suggest that their proposal is for a ramped-up Internal Revenue Service that is much more serious about collections than the current estate tax. We share their view that more could be done to collect estate tax revenue (and tax revenue more generally).
And we certainly do not start from “the premise that the rich cannot be taxed,” as Saez and Zucman allege. Instead, we share their objective that it is imperative to raise more tax revenue from those at the very top, and we propose a variety of progressive reforms to this end.
However, government budget scorekeepers properly score proposals in the form in which they would likely be enacted, not on the basis of the aspirations of their academic authors. So, we stand by our position — which will possibly be tested someday — that official scorekeepers would be very unlikely to validate the Saez-Zucman estimate of Warren’s proposed wealth tax, and that the gap would likely be substantial.
Trump won’t pay his debts. Ana Kasparian, Maz Jobrani, and Ramesh Srinivasan, hosts of The Young Turks, break it down.
At Politicon, Tucker Carlson cited:
2007 Robert Putnam:
Ethnic diversity is increasing in most advanced countries, driven mostly by sharp increases in immigration. In the long run immigration and diversity are likely to have important cultural, economic, fiscal, and developmental benefits. In the short run, however, immigration and ethnic diversity tend to reduce social solidarity and social capital. New evidence from the US suggests that in ethnically diverse neighbourhoods residents of all races tend to ‘hunker down’. Trust (even of one’s own race) is lower, altruism and community cooperation rarer, friends fewer. In the long run, however, successful immigrant societies have overcome such fragmentation by creating new, cross‐cutting forms of social solidarity and more encompassing identities. Illustrations of becoming comfortable with diversity are drawn from the US military, religious institutions, and earlier waves of American immigration.