The economics of spite

Emma Trimble is a writer, broadcaster, and presenter

After yet another private school closed in recent weeks, the Reverend Marcus Walker commented simply: ‘A consequence of spite.’

Since Labour introduced 20 per cent VAT on fees, around 100 private schools have closed, making life nigh on impossible, not for those sending their children to Eton or Harrow, but for the parents of pupils at smaller schools like the recently closed historic 132-year-old St Joseph’s in Reading, or Durham High School that had educated girls for 142 years.

Such families make sacrifices to take the responsibility for their child’s education out of the hands of the state, while their taxes continue to fund the education of other children. These aspirational parents are punished by the state for doing the country a favour.

A parent of a pupil at St Joseph’s told the BBC that “People had to scrimp and save and run 20-year-old cars to pay for this education, but it wasn’t out of reach. It was an affordable, diverse school which catered for all in society.” Now, they will be forced into state-funded education.

This is just one aspect of the burgeoning economics of spite.

Small companies – the backbone of Britain – have been hard hit. National Insurance hikes have made it difficult for them to keep their heads above water and retain current staff, never mind employ anyone new. At the same time, according to Alan Milburn’s review, over one million young people do not have a job, and half of those are not even looking for one.

Yet not content with quashing the spirits of those who aspire to make money, the Government has also set its avaricious sights on those who save. Anyone who is financially responsible, aspires to build a business, or improve their lot, is likely to think Britain is not the place to do it. I know this from anecdotal experience, but the numbers back it up at the highest level. Britain is haemorrhaging millionaires. One in six people who had previously been on the Sunday Times Rich List were absent from it in 2026.

This spiteful class war hurts us all. As Conservative councillor Elliot Keck (formerly of the Taxpayers’ Alliance), explained on GBNews, Burnham’s prospective increase in capital gains tax “taxes investment, it taxes entrepreneurialism, it taxes the purchase and sale of shares, it taxes people that set up companies and sell them. The exact sort of investment, the exact sort of economic activity that drives the economy, that creates jobs, that creates products that we want to use, that creates a huge amount of tax […] it is the exact sort of activity we should be incentivising as much as possible.”

Recall the ire when Elon Musk became the world’s first trillionaire. Yet this was a clearcut case of wealth begetting wealth. Of SpaceX’s current and former staff, 4,400 became millionaires overnight because they had been given shares as part of their pay. One of them was Juan Hernandez, a welder originally from Mexico, who had started as a contractor on a $28 an hour.

It is the same zero-sum fallacy that drives Gary Stevenson’s calls for a wealth tax that will only drive the wealthy – and those with the most potential – out of the country. As the IEA’s very own Christopher Snowdon has argued in The Critic, Stevenson is ‘spoon-feeding’ an economically ill-informed public with ‘falsehoods and false hope.’

Benjamin Disraeli had argued that in Victorian England there were two nations: the rich and the poor. But as Lord Kempsell observed at the recent Disraeli Conference, organised by Fighting for a Free Future, the two nations are now more accurately described as those who work and those who do not. Those who generate the wealth of the nation, and those who live off others.

Lord Kempsell shocked the audience by informing them that, while someone working full-time on the National Living Wage earns £22,000, someone on Universal Credit with average housing benefit and PIP could receive around £25,000 a year. This number only climbs: a person with five children claiming these benefits receives £55,000 a year, according to the Centre for Social Justice.

He told me: “The tax and welfare system is becoming a redistribution mechanism from the modestly paid hardworking adults to the economically inactive adults. This is never how the welfare system was conceived. This is one of the key dividing lines in Britain today, as Disraeli would have put it, it’s like there are two nations.”

There is a fundamental unfairness to this Robin Hood strategy of redistribution – and indeed, ‘Burnhamonomics’ – that is contributing to a growing resentment.

You might ask why, under these circumstances, anyone would wish to bear the persecution of making anything of their lives, when it seems the most profitable thing to do is nothing. The economics of spite is a surefire way to destroy a nation’s spirit.

Leave a comment

What we’re reading

1. Burnham begins. For the Telegraph, Allister Heath has made his typically Earth-shattering pronouncement about Andy Burnham’s first speech as leader, suggesting it amounted to little more than a confused mix of historical revisionism and economic misunderstanding. Britain’s problems stem not from Thatcherism, but decades of low productivity hampered by our next Prime Minister’s romantic enthusiasm for state intervention and love for Neil Kinnock.

2. A wealth of evidence. Meanwhile, Matthew Lynn has written for The Spectator as to why it would be such a mistake for Burnham to introduce an annual wealth tax. While taxing the mega-rich may poll well, wealth taxes have historically failed to raise the expected revenue due to the ability of individuals to relocate. Countries like France, Germany, and Sweden have also abandoned their wealth taxes are discovering they drive away investment and entrepreneurial talent.

3. Saturday I’m in work. At ConservativeHome, John Cooper, the MP for Dumfries and Galloway, has argued that Britain should revive the tradition of Saturday and summer jobs for teenagers. Not only do they bring in a little pocket money, but they teach responsibility, discipline, teamwork, and self-reliance. Alan Milburn’s review concluded that the disappearance of Saturday jobs had contributed to the spike in young people not in employment, education or training.

4. Google-perplexed. Our chums at Epicenter have made the case that the European Commission is applying the Digital Markets Act inconsistently in its treatment of Google’s search results. It suggests a double standard is being created that puts at risk both competition and legal certainty. It accuses the Commission of shifting the goalposts, effectively rewarding some business models while penalising others without following a consistent legal principle.

5. Flight risk. Ed West has argued in his Wrong Side of History Substack that Britain’s approach to crime prevention falls far short of the ‘black box thinking’ that has made aviation particularly safe, with each disaster properly investigated. By contrast, while crime has declined since the 1990s, advances in technology should have produced greater reductions, but policing efforts are hampered by the repeated release of dangerous offenders with long criminal records.