April 15, 2022 - 7:00am
Many of the Labour Party’s current woes stem, as a number of commentators have noted, from a conflict of worldviews between the party’s woke urban bourgeois faction and a more culturally conservative working-class base. Perhaps less obvious, though, is that the Conservative Party suffers from an equally virulent internal conflict of interest.
But it’s not between the so-called ‘Red Wall’ voters and Tory faithful. The conflict is generational. Conservative voters skew older and more wealthy, and thus (at least in the short term) representing the priorities of older people and home-owners is in Tory electoral interests.
This is increasingly, painfully salient in Tory policy. This week, it was announced that interest rates on student loans are due to rise sharply. Under the changes higher earners could see the interest jump from 4.5% to 12%, meaning an extra £500 a month in charges for someone with the typical loan total of £50,000.
This assault on Tory youth prosperity is, sadly, nothing new. The ongoing crisis in housing affordability is now, visibly, exerting downward pressure on family formation: according to one 2020 study, 13% of couples under 45 have delayed children due to housing stress.
But given the choice between appeasing (frequently older, better-off, Tory-voting) NIMBYs and easing planning rules in the interests of the young, the Tories have proved unable to look beyond the electoral short term. A by-election defeat last year in the Tory heartlands, fought on planning reform, saw a U-turn on changes to planning rules. Cue NIMBY jubilation, no doubt further warmed (for homeowners) by the fact that since the 2020 study on childless Generation Rent, average house prices went up by 8.5% in 2020, and a further 9.6% in 2021.
The Tories continued to strip-mine the next generation’s flatlining wages on behalf of Conservative-voting boomers in December, with additional taxes to pay for social care — an ever-growing spending commitment that is, in practice, heavily skewed toward tending to the elderly. In case this wasn’t enough, it was followed up with a March pledge to reinstate the pensions triple lock.
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SubscribeA good analysis, but it’s worth considering that nearly every initiative to increase the funding available to people to buy houses merely results in an increase in those house prices.
As unpalatable as it is to the left, I’m afraid that reducing the demand side of this equation is the real long-term answer.
Is this the unspoken lesson from le Pen ?
The long-term answer is to stop tinkering with demand and increase supply. That is: build more homes. Not all of them need to come from building on new land, changing the rules to allow a lot more building upward in cities is a good idea. But either way the government needs to confront the vicious nimbyism of existing homeowners, and they have shown no appetite to do that.
The overarching long term answer is to ensure that the gap between demand and supply stops widening – and that can/should be tackled from both sides.
What do you mean by “reducing the demand side of this equation”? Convincing young people that they don’t need housing?
I’d imagine he means reducing immigration.
Ending ALL immigration.
Notice no one talks about housing shortages in Japan.
https://www.wsj.com/articles/what-housing-crisis-in-japan-home-prices-stay-flat-11554210002
Ok, but a large proportion of those people who want to stop development also, at the least, do not feel strongly about immigration and often even benefit from cheap labour.
‘Right to buy’ and similar schemes do indeed involve more money chasing the same number of properties. The same does not apply to radically increasing the housing supply, but that runs right into the ‘nimby’ lobby, who are very powerful (and well represented here!). And of course rising house prices are nothing but a boon for existing home owners. No group of locals should have an effective veto on what happens on someone else’s land. I refuse to sign all petitions based for example on preserving views of Blackheath from Lewisham (I kid you not!).
I am afraid I agree with Mary Harrington. The Tories and their supporters will have to find some better and more direct answers than ‘reduce immigration’ as you are implying, or the long term trend will be for young people to give up on them altogether.
I remember the golden days of low and stable house prices under Tony Blair. The £40k flat I lived in in London in 1997 when New Labour won the election was only worth £600k in 2010 when they left power.
Always thinking about the young those Labourites, not like the wicked Tories.
Drastically cutting immigration will do much of it – like Le Pen wants to.
Demand drives up the price of accommodation, the excess supply in the labour market drives down wages and disincentivises the provision of training/apprenticeship schemes.
But all of the major parties want to shovel as many people into the country as possible.
Agreed. But who, Sharon, is there to vote for? The only “minor” party of the Right that ever gets a mention is Reform, but Tice’s immigration policy is much the same as that of the Tories (which delivered a record 930,000 last year despite continuing travel restrictions).
Quite rightly, as yesterdays article illustrated, Le Pen’s pledge for University accommodation, apprenticeships, and no tax for under 30’s in work or for entrepreneurs . What’s not to like?
This country needs to give young people a stake in society & their community, through firstly a home and then creating dynamism within training and work.
Ironic that people refer to Le Pen as far-right when many of her policies would have been considered left of center only a couple of decades ago. How the world has changed.
I doubt that it’s ironic that Le Pen is described as far-right.
It’s an indication that much of the mainstream media and the enlightened classes that run it have an entrenched leftist view of the world. Pretty much anything they don’t like or don’t understand is ‘far-right’.
To them far-right just means ‘nasty’.
Hear hear!
I think exempting under 30s (or under 25s) from income tax is a terrible idea, and I can find quite a lot to dislike about it. Raising the tax threshold makes sense, since most people don’t earn much in their 20s. But I can’t see why someone who’d be in the upper tax bracket in their 20s (David Cameron’s first job after Oxford, IIRC, paid £90k) should pay no tax at all–and how much would their salary have to rise after the relevant birthday to keep their take home pay the same?
Also, the young not paying income tax could lead to greater intergenerational tension. The point about income tax is that everybody contributes to the government, and therefore everybody has a the right to a say. It’s pretty easy to imagine older people (like 31 year olds) saying, “I’m paying my share for police and schools and defence, but these kids aren’t. Why should they enjoy the same representation that I do?”
Lastly, I can’t really believe in governments supporting people doing what comes naturally. (You know who tried this, of course.) I can see that the result of market liberalisation has been to greatly inflate housing prices which discourages people from marrying and having children (I’m surprised that only 13% of couples have delayed having children; it looks like far more than that) and, yes, government policy should lean against that. But people should get married because they love one another and have children because they want them, not for tax breaks.
Staggering how little people understand about taxation: In the late 1990s, when interest rates were high, I assisted in a survey sponsored by a large UK asset manager and London Business School on the actual bottom line effect, to HM Treasury and the economy of the lowering of income tax. Only when our models got down toba rate of 18% did the revenue to the Treasury drop. why? Because revenues come in LSD, not percentages, and the increase in spending, saving and investment boosted the economy, to make non income tax revenues increase from new sources..
Mary, you misunderstand the student loans.
The repayments don’t go up, the loan takes just longer to repay.
It is meaningless to most people who will never repay it anyway. It will hit those with reasonable salaries, but not quite rich.
Jemima does 4 years of Woke Studies at university then gets a job in HR for £25k p.a. and never repays her loan.
The university she attended keeps getting its funding to keep the Woke Studies graduates rolling off the production line.
The poor old working stiffs pay for them both with higher taxes while complaining about the sudden appearance of all these Woke lunatics.
Indeed, but Jemima won’t be touched by any of that.
Exactly. It will hit graduates who look for promotion and better paid work, i.e. the more competent and aspirational. The very people who the Tories need to vote for them.
True.
Yet another reason to question liberal assumptions about the “far right”.
It is worse than Mary thinks. I am old and will not support the Tory Party. It is screwing me as much as it is screwing my young relatives.
I agree, but the choice is terrible. We desperately need a new party that represents the people and not just the champagne socialists and toffs in the South East. Alas many of them are now moving out and bringing their views to the rest of the country.
There is a good article in The Spectator by Sam Ashworth-Hayes, that explains why I would tear up my ballot paper, (and retain my self-respect), before voting Conservative.
How does tearing up one’s ballot paper retain a person’s self-respect? It sounds to me like self-righteousness without any merit beyond personal aggrandisement..
That is another option – saw off the SE of England and watch it collide with the EU. And leave the rest of us to get on with real life. Apart from Bristol and bits of Cheshire, obvs
Like the rest of us, you end up voting for the least worst.
Hear hear. I’m 69 and love the triple lock, but I’ll vote for anyone / anything that really does something for those under 30, or even 40, for whom a home and family is just a fantasy.
Too true, as a parent of twenty somethings, I’ve been moaning about the lack for investment in this age group but actually you’re right; our government has been mining the younger generations for many years. Boris Johnson didn’t pay tuition fees. I worry that the resent will deepen amongst the young and when they hold the power, there will be little compassion for the old, who they will identify as having stolen their futures.
Obviously, the drive since WW2 to get people to live longer has its disbenefits. Apart from tying up houses, older people have a huge need of the NHS – in order to live a little longer.
This idea of the old taking things away from the young is new and dangerous. It will (or has) produce an anger in the young, who will of course never be old themselves. What ahould we do?
The only answer is to disenfranchise everyone over 70 years of age. When you are 70 you can no longer influence decisions about the future.
Or receive anything other than palliative care
Or occupy a house on your own with more than 2 bedrooms
Or breathe the air?
More rubbish from the anti-trannie corner. We have an ageing population not a younger population, so we needn’t concern ourselves overly with a shrinking constituency that tends to vote less, and Marine is going to lose badly again against micro-Napolean.
Why should the younger generation need ‘help’? Are they not capable of helping themselves as did older generations? Not owning property did not prevent my grandparents’ and parents’ generations from starting a family. Owning property is not the be all and end all in life and can be a double-edged sword. Particularly if being mobile in order to get on in life is a requirement. It would be better to encourage more rental properties onto the market in order to generate more competition, thereby bringing down prices. Inflation is, over time, the main reason that fixed assets such as houses continue to increase beyond affordability. If inflation was kept to zero, then house prices would not go up anything like they do. There is far less obsession with owning property on the continent as many people do better investing in other markets, to the benefit of the economy overall. Of course, the politics of the situation is another matter altogether!
You parents and grandparents probably had a council house, or if they didn’t then the rent would have been a much smaller proportion of their wage than the young face today. They were able to live reasonably comfortably on a single average wage, whereas most families now require two full time working parents just to keep a roof over their heads. My grandparents were able to raise 8 kids and buy a family home on a single bricklayers wage, try doing that these days. Many youngsters require a deposit bigger than my grandparents entire mortgage simply to get a foot in the door, which they’re supposed to save while paying massive rents.
If you want the poor to return to be subservient to wealthy landlords then we’d need much stronger rental protections for tenants, and much heftier capital gains taxes on property owners as the pension is currently based on people owning their own home and not paying rent/mortgage in retirement. If you want to elderly to continue paying rent until death then you’ll have to substantially increase the pension.