Opinionomics | 13 April 2012

Must-read comment and analysis. Featuring oil, Osborne and old people.

1. How Detroit’s adapting to higher gas prices, in one chart (Washington Post | Wonkblog)

Brad Plumer shows that, unlike in 2008, American car manufacturers are finally adapting to high oil prices.

2. The Downside to Longer Life (Slate | Moneybox)

If we all live longer, pensions will become more expensive! Isn't that a tragedy? Well, no.

3. The Swiss boson (Financial Times | alphaville)

"The Swiss boson is a hypothetical condition which is supposed to account for why the Swiss franc has ‘mass’ when all other neighbouring currencies don’t."

4. Any other Chancellor would be seeing the door by now (Tax Research UK)

Richard Murphy asks why Osborne has handled the charity clampdown, the pasty tax and, well, everything so badly.

5. On tax avoidance, allow me to leap to the defence of the super-rich (Guardian)

Nick Hytner, the director of the National Theatre, argues in favour of those "dodging" tax by giving to charity.

A South Korean activist in a Kim Jong-Un mask holds up a fake rocket. Stocks rose across east Asia on the news that North Korea's launch had failed. Credit: Getty

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty Images
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David Cameron’s starter homes: poor policy, but good politics

David Cameron's electoral coalition of buy-to-let retirees and dual-earner couples remains intact: for now.

The only working age demographic to do better under the Coalition was dual-earner couples – without children. They were the main beneficiaries of the threshold raise – which may “take the poorest out of tax” in theory but in practice hands a sizeable tax cut to peope earning above average. They will reap the fruits of the government’s Help to Buy ISAs. And, not having children, they were insulated from cuts to child tax credits, reductions in public services, and the rising cost of childcare. (Childcare costs now mean a couple on average income, working full-time, find that the extra earnings from both remaining in work are wiped out by the costs of care)

And they were a vital part of the Conservatives’ electoral coalition. Voters who lived in new housing estates on the edges of seats like Amber Valley and throughout the Midlands overwhelmingly backed the Conservatives.

That’s the political backdrop to David Cameron’s announcement later today to change planning to unlock new housing units – what the government dubs “Starter Homes”. The government will redefine “affordable housing”  to up to £250,000 outside of London and £450,000 and under within it, while reducing the ability of councils to insist on certain types of buildings. He’ll describe it as part of the drive to make the next ten years “the turnaround decade”: years in which people will feel more in control of their lives, more affluent, and more successful.

The end result: a proliferation of one and two bedroom flats and homes, available to the highly-paid: and to that vital component of Cameron’s coalition: the dual-earner, childless couple, particularly in the Midlands, where the housing market is not yet in a state of crisis. (And it's not bad for that other pillar of the Conservative majority: well-heeled pensioners using buy-to-let as a pension plan.)

The policy may well be junk-rated but the politics has a triple A rating: along with affluent retirees, if the Conservatives can keep those dual-earner couples in the Tory column, they will remain in office for the forseeable future.

Just one problem, really: what happens if they decide they want room for kids? Cameron’s “turnaround decade” might end up in entirely the wrong sort of turnaround for Conservative prospects.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.