Fairer system

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It was good to see a balanced account from Allan Massie of the issues around welfare payments (Perspective, 22 January), instead of the polarised views which claim on one side that all claimants are feckless Eastern European immigrants, and on the other that all are noble and worthy individuals struggling to survive in a hostile capitalist culture.

As with many of these issues, the truth probably lies somewhere in the middle. To be sure, there are feckless poor people, but there are probably just as many feckless rich people, as evidenced by the Saatchi/Lawson story, the Kardashians’ exploits and the like.

As Allan suggests, the issue of funding welfare benefits is not as simple as it appears. I worked for the Supplementary Benefits Commission in the late 1970s, and I suspect we had more or less the same mix of “feckless” and “worthy” benefit claimants, but the cost of maintaining a reasonable lifestyle then was much lower – housing costs, for example, have not been reduced by housing benefit being paid to landlords.

Equally, then as now, there were probably only jobs for 70 per cent of the working population, and the position is worse now in the so-called “knowledge economy” where there are few decent semi-skilled vacancies.

My next job in those days was working for the Inland Revenue, where I seem to remember there was a 90 per cent tax band for unearned investment income.

An independent Scotland would not solve the gap between very rich and poor at a stroke, but it could at least attempt a fairer system through effective taxation.

The Scotland’s Future document is vague on this point, offering only to “simplify” the tax system. More appropriate taxation of the very rich would surely add to funds to support those at the bottom to obtain suitable and sustainable employment.

(Dr) Mary Brown

Dalvenie Road

Banchory

The moral critique of the Westminster government’s “attack on society’s most vulnerable” is also sound economics. Cutting public expenditure and wages was shown to be a monumental folly in the 1930s’ depression.

Wasn’t it a “heretical” economist, J A Hobson, who pointed out “consumption limits production and not production consumption”? Subsequently, Keynes paid tribute to Hobson, who was banned by the education authorities from teaching this view.

Doesn’t it follow that a fall in consumption means less work and therefore fewer jobs?

One way of addressing the problem of reduced consumption is to tackle the issue of inequality. A number of studies reported recently show vast inequalities of wealth and income both in the UK and globally.

Arguably, a substantial redistribution of income from rich to poor would boost overall spending and “aggregate demand for goods and services”.

Ellis Thorpe

Old Chapel Walk

Inverurie

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