In her conference speech, Chancellor Rachel Reeves gave many clues about what will happen in her first term. budget On October 30th. In addition to being the first female chancellor, her speech was also unique in that it relied on optimistic rhetoric. Things will get better. We turn a page; we have a long-term industrial strategy, etc. There can be little harm in getting a positive note. But will it have an impact in the short term, let alone the long term? Past experience shows that this will not happen.

His main emphasis was on the goal of promoting economic growth. Again, past experience shows that 1% annual growth is possible. So we shouldn’t expect to see much improvement anytime soon. Our past growth has brought us to where we are now. Will future growth be different per se? He explained that the main way to stimulate growth is a strong house-building programme. This may be a good thing in itself, but it will not contribute significantly to growth. Growth depends on investment in human and physical capital, which leads to new products and the more efficient production of existing products. No source of growth comes from investment houses.

Taxation was mentioned lightly in his speech. There have been some encouraging statements that there are plans to close some of the loopholes created by the use of trusts to avoid tax. More importantly, I urge the Chancellor to seriously consider a wealth tax on multimillionaires and above, not lucky homeowners. And to avoid encouraging major judicial moves, a small rate of less than 1% per year should be set. The draft legislation for the appointment of tax lawyers must be prepared very carefully. Only the Green Party is talking about a wealth tax. We can admire their courage and deplore the timidity of the rest, especially Labour.

Gross inequality is a major threat democracy. The ultra-wealthy can use their money both to influence public opinion and to influence public policy more effectively. Market economies have a built-in and persistent tendency towards inequality. Thanks to skill, effort and good luck, some individuals and firms perform above average. These winners in the competitive process can further increase their advantage in subsequent competitions. Not everyone will make it, but a significant number will. And so the process continues, with more and more wealth concentrated in the hands of the winners.

The early stages of the competitive process could address the problem of extreme inequality through income taxes, capital gains tax and taxation of inheritance. But we’re not in the early stages yet, nor are we far from it. The only tool currently available is a wealth tax. Some extremely rich people came together and because of their justified concerns about democratic civilization, they themselves defend the idea of ​​a wealth tax.

Of course, traditional tools of budget control need to be used. But these will only smooth the edges of our problems. It’s time to think seriously about a wealth tax targeting multimillionaires and billionaires. This is not the politics of jealousy. This is at the core of our need for an economy that is fair and meets the needs of our society.