Businesswoman Ready for Work with Husband In Kitchen.

The big political theme of my life has been the rise of free market values and the decline of collectivism.  When I was first old enough to be aware of what was going on politically, in the seventies, the state played a big role in things.  It would intervene and manage things quite extensively.  The results of that intervention varied.  Some were quite good – like universal education and health provision.  Others were perverse or just embarrassing.  Keeping British Leyland going was a bad idea in retrospect.  The people who spearheaded the radical moves to dismantle the state’s role and encourage us all to become entrepreneurs were the Tories.  This was a bit of a departure for the one time representatives of the upper classes, but it was a very successful one.  Even when it didn’t win them elections, which it usually did, the radicalism generally won the argument.  Nowadays even avowedly left wing politicians don’t want to go back to the old failed statist ways of the past.

Of course this is politics, so none of this has been referred back to any data from the real world.  So the fact that the many reforms and transformations haven’t led to any particular economic benefits, and indeed have made things if anything worse, is not part of the dialogue.  So I was surprised to see David Cameron going back to a policy tool that has been out of favour since the days of Edward Heath and Harold Wilson.  He is proposing a new tax arrangement that will enable spouses to give each other a bit of their personal allowances.   It doesn’t take long to work out what this means in practice.  It is basically a subsidy for unequal marriages.  It is framed as being very liberal because it applies equally to same sex marriages and will also apply to partnerships where the woman works and the husband stays at home to look after the kids.  But in practice the vast number of beneficiaries will be households where the man earns a lot more than the woman.   So basically it is using the tax system to encourage a particular way of life.  This is social engineering.

Far be it from me to advise Mr Cameron.  He is an astute and successful politician and I suspect that this latest wheeze will be a very handy vote winner for him.  It might not meet with universal approval but it will certainly go down well with traditional Tory voters, who could really use some motivating if the Tories are going to get back with a majority next time.  But surely he could have come up with something a bit more radical?   Why use a subsidy.   Shouldn’t he be looking for a radical free market solution?

What I suggest is doing away with divorce altogether, and replacing the current system with transfer fees.  This would work something along the lines of the very successful transfer fee market in footballers.  So rather than having to go to court and get your marriage annulled you simply put yourself back on the market.  I know the City is already busy, but I am sure they can find somewhere to run a marriage market.  It would offer a few challenges of course.   It would have to cope with negative values for example.  If you are an indigent drunk with a beer belly, the harsh truth is that you are probably going to have to pony up to get anyone to take you.  Likewise middle aged women with children.   High earning lookers on the other hand can expect to recoup the value of their attractiveness.  This might all sound a bit harsh, but you can’t buck the market.  If you aren’t desirable you really have nobody but yourself to blame after all.  But if everyone can be realistic about their price, we ought to be able to achieve a market clearing solution which as any neoliberal will tell you is the optimum.

In fact, is this so radical?  Traditionally marriages have been a lot to do with economics.  Dowries used to be the subject of extensive negotiations.  What the family of the bride were prepared to lay down by way of a settlement was a matter of much importance.  Perhaps my suggestion is in fact a very conservative one.

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