This article was originally published in the St Andrews Economist
In the early days of the French Revolution, a curious phenomenon occurred. Aristocrats who held provincial privileges, titles, and rights to land, legislated to destroy their own privilege. Later they would explicitly ban insignia adorning houses: coats of arms and weathercocks. Did they partake in this masochistic act because they were scared of the people? Seemingly not. Impossible as it is to step into their minds, the process seems to have been one of joyous self-flagellation. It was a new way to appear on the public stage, a new signifier of virtue, and the nobility all wanted a slice.
A month before the Scottish elections, the Panama Papers scandal occurred, leaking eleven and a half million documents pertaining to the activities of the richest people in the world. The information that was now available was not surprising to the campaigners who had been haranguing the government about tax justice for the last decade, but it immediately proved itself useful as a goad for unpopular politicians. David Cameron was the first to suffer, with suspicions that he had directly or indirectly benefited from tax avoidance schemes. Soon came the demand for him to publish his tax returns, which he partially published, resulting in a second scandal due to the appearance that he had dodged inheritance tax. Now journalists were baying for blood. The first taste of tax returns had been unimaginably glorious. Now they wanted Osborne’s tax returns, and those of anyone else who looked shifty – why not some high profile public service managers while we’re at it?
In Scotland, a few leaves stirred. Of what importance was capital to the hills and glens? Somewhere in the shadowy chamber of Holyrood, the ears of some of the less sleepy MSPs twitched. Kezia Dugdale, the leader of the Scottish Labour Party, was the first to make a move. She published her tax returns (and was therefore able to make a virtue out of the rather dubious accolade of being first). Her tax returns are, frankly, boring. She has a total income of £57,465, some of which she donates to charity. She pays around £10,000 in tax. Apart from this being (to my mind and hers) astonishingly low, there isn’t much to see here.
Not to be outdone, Ruth Davidson, leader of the Scottish Conservative Party published hers, closely followed by Willie Rennie, the leader of the Scottish Liberal Democrats. Nicola Sturgeon sealed the deal the same day. Now we had four tax returns. Ruth Davidson’s also showed charitable donations. Nicola Sturgeon had foregone pay (as did Salmond before her) to contribute to ‘public spending’. It was all very virtuous, very uninteresting, and rather desperate. Like the French aristocrats before them, the Scottish party leaders had exposed themselves, in a fit of public-facing virtue.
The difference was, no one cared.
Bemused, the Scottish public turned back to Cameron and his Downing Street cadre. They wanted to see what was happening where the money was. In London newspapers scandal rumbled – people were going to fall because of this. The claim that knowledge is power was beginning, in a roundabout way, to make sense. The virtue of the Scottish politicians was completely irrelevant – after all, these people not being millionaires they had little opportunity to not be virtuous. The worst thing that can be pinned on Nicola Sturgeon as an individual is the embarrassingly bourgeois fact that she owns a very expensive coffee machine.
Kezia Dugdale, realising the disinterest of whatever ephemeral group she had identified as her core voter base, commented on the scandal:
Not since the MPs expenses scandal has there been such palpable anger at the sense of unfairness at the heart of our society.
Politicians need to not only play by the rules, they need to be seen to be playing by the rules.
Of course, the comparison with the MPs expenses scandal is absurd. After the 2009 scandal, MPs were ordered to pay back 1.2 million pounds. In contrast, the National Audit Office estimates that the UK loses £2.7 billion a year from tax avoidance and £4.4 billion per year from tax evasion. That’s 7,100,000,000 a year – compared to 1,200,000 for the expenses scandal. Or in other words, tax evasion and avoidance costs the UK five-thousand-nine-hundred-and-sixteen times more per year than one year of unfairly claimed MPs expenses.
This is not to say that MPs who over-claim expenses aren’t doing anything wrong, but simply that this is a different order of expropriation. Rather than joyfully publishing their tax returns, it would have been entirely possible, if more uncomfortable, for Scottish politicians to talk about how to deal with companies that don’t pay taxes. This isn’t, as Kezia Dugdale implies, a matter of improving public scrutiny of politicians. It’s not about accountability, it’s about one of the biggest problems facing state finances in this century. It’s about a globalised world where capital is mobile enough to slip through the fingers of even the most evangelical state. In terms understandable to the Scottish Parliament, it could be about, for instance, pushing through the land reform that we’ve been promised by the Scottish Government for so long – the Panama Papers have demonstrated that 1000 square miles of Scotland’s land is owned offshore.
Scottish politicians will be pleased to stand up and shout ‘I’m clean!’ But there’s more to governance than that. In the few weeks before an election a scandal like this should be used by political parties and the people to drive forward debate, and discuss what is to be done. Instead, the Scots have had to suffer the guff of the party leaders’ dirty linen – their 57 grand salaries – which nobody wants waved in front of their face.
The French nobles who so enjoyed the beginning of the revolution received a nasty shock after a few years. Their displays of virtue were scrutinised by canny sans-culottes and shown to be baseless. Even in such a sleepy polity as this one, we might live in hope that years of inaction by our politicians might one day lead to their glorious downfall. For without terror against the owners of Capital, as Robespierre would surely have enjoined had he been with us today, virtue is powerless.