Friday 24 February 2017

Unintended consequences

I was writing recently about how taxes not only raise revenue but also shape the behaviour of the citizenry. For everyone reading this, there are choices to be made every day: either upgrade the Porsche or take a second Winter holiday; buy an apple or an orange for teacher; install a new kitchen [the cupboard doors are sooo yesterday] or fund a school-room for girls in Uganda. This is all very abstemious and Protestant but a consequence of desiring more stuff than we can afford.

I got my first proper job in 1983, returning from Boston where I'd worked really hard for buttons to get my doctorate, I secured the penultimate job in population genetics in England before that sub-discipline sunk beneath the tsunami of molecular biology. It wasn't a great job as regards salary - I think it was a tad over £8,000/year - but it was a three year contract which allowed me to get experience teaching and carrying out independent research,  It was the Thatcher years and all sorts of incentives were being showered on the middle classes or those who aspired to join that club. A, with hindsight shameful, policy to sell off the state-owned housing stock was coupled with a scheme called MIRAS Mortgage Interest Relief At Source. This plan allowed ordinary people to buy a home and offset a good part of their mortgage repayments against whatever income-tax they were paying. If you were renting - no dice.

After three years finding my feet and getting my theatre-performance lectures nailed, the University offered me another 3 year contract and we spent that Summer looking at houses in Heaton. This area was made up of Edwardian red-brick terraces, 1930s semi-detatched with gardens and a quite absurd number of non-conformist chapels and no pubs. The absence of pubs was due to a stipulation of the original land-owner of the fields that were built over. It was rather less salubrious than Jesmond where we had been renting for the previous three years; but Heaton had aspirations and was upwardly mobile. We bought the second cheapest house we viewed (the cheapest had a hole in the roof and pigeons in the loft) and acquired a mix of neighbours. Our affluent pals in London urged us to buy the most we could afford but we didn't want the debt and were risk-averse. 37 Cheltenham Terrace cost us £21,000.

At about the same time, the Conservative government decided that academics were not being paid enough and all workers in the University / Polytechnic sector were given a 25% pay hike over two years 15% + 10%.  We'd been doing alright up to then and living within budget, so this was windfall money. I promptly went out and bought a Technics stereo system from Japan. In doing so I helped contribute to the death of the electronics industry in the UK to follow steel, coal, cotton, pottery, ship-building into post-industrial oblivion. Very slow hand clap.

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