Instead of taxing older people to the hilt, Labour should use my blueprint to build a country in which the young can flourish: DANIEL HANNAN

Young people in this country have got a raw deal. They were locked up at the worst possible moment in their lives because of a virus that offered them no threat.After they emerged from lockdown, it became clear that they would spend their lives paying off the debts Britain incurred in those heedless months.Then, as if things were not bad enough, we threw away the priceless advantage of a flexible labour market, making it much harder for them to find work.These are real and serious grievances. But the way to address them is not to clobber older people; it is to lift the burdens from the young.The way to have intergenerational justice is not to tax older generations so that there is equality of suffering. Intergenerational justice will come when younger people can realistically find well-paid jobs and a shot at buying a decent place to live.The Institute for Public Policy Research (IPPR) wants to tax the elderly more. It says we should reform a tax-and-spend regime that is ‘heavily tilted towards taxing work and younger earners’.It is not wrong about that: the system is indeed so tilted. But the IPPR’s proposed solution – a property tax that would be set at a percentage of the value of your residence, and that would replace council tax – begs the question.Our taxes are already higher than at any point since the post-Second World War demobilisation. To find a higher overall proportional tax take in Britain, we must go back to 1947, when the only heating source most people had was coal, when indoor plumbing was a luxury, and when rationing allowed us one fresh egg a week. Taxing older people more, and setting up the full intrusive mechanisms necessary to assess the value of their homes, will not do younger people any good, writes Daniel HannanHow in the name of all that is holy have we come to take it for granted that, in a peacetime economy, the answer to our borrowing crisis is to raise taxes to where they were when we were in a life-and-death struggle against Nazism? Are we seriously pretending that we should not instead cut spending – at the very least back to where it was before the supposedly one-off emergency spending triggered by lockdown?The way to help voters of all ages is to stimulate the kind of growth levels we took for granted in the 1990s or early 2000s, before the surge in state spending.Economic growth will mean that younger people can get decent jobs and thereby afford to pay for the pensions of retired people. We will not get growth through higher taxation and spending.Redistributive taxation is doubly bad for productivity. If you must give half of what you earn to the taxman, you will work less hard. If a chunk of your money then comes to me in benefits, I will also work less hard.Raising taxes, while it may plug a one-off borrowing hole, slows economic growth and so, in the medium term, makes the problem worse.Let us hear no more about tax rises until we have reduced some of the more needless spending. Don’t give me any nonsense about ‘austerity’: we have seen state spending rise from a third of our economic output in the Blair years to nearly half now.We are spending more on benefits for working-age adults than we are raising from all income tax. We are spending millions on radio adverts telling people to claim more benefits.Instead of raising taxes, and thereby making their employment prospects even worse, we should remove the obstacles preventing young people from flourishing, and that drive many into emigration.These obstacles are very real. Unemployment among young people is now 16 per cent, with over a million 16 to 24-year-olds not working or studying. Job vacancies are fewer, especially for graduates. In July 2017, 55,000 graduate roles were advertised. Last July it was 15,000. This July only 8,000.Part of the problem is the rise in the employers’ share of national insurance. Reversing that increase would cause an immediate shortfall, but would pay for itself over time as more jobs were created.Other things could be done right away without costing the Treasury a penny. Freezing the minimum wage, for example, which is deterring many employers from giving young people their first break. Or pausing the measures in the Employment Act which make it too risky to hire new staff.We can picture the economy as a man swaying under a heavy load. That load is made up of taxes and regulations decreed by successive Chancellors in pursuit of one day’s good headlines or seeking the support of a bloc of voters.That load can be lightened in several ways: cutting regulations, especially employment regulations. Freezing benefits, so that people are incentivised to seek work and become net contributors rather than net recipients. Dropping the monopolistic NHS model that gives us such poor outcomes. No longer pretending that self-diagnosed mental health conditions are equivalent to physical disabilities. Ensuring that the pound maintains its value. Cutting taxes on savings and investment.I don’t expect our new prime minister to do all these things. To be fair, none of his predecessors did. He can surely do some of them, though. For the only alternative is to keep loading the burden higher and higher, piling on more and more taxes that, by the law of diminishing returns, yield less and less revenue, until the man carrying the burden collapses under its weight.Young people have every reason to feel they are not getting a fair shake of the stick. Even before the lockdown, they were suffering from our unique national reluctance to build houses or, indeed, any kind of infrastructure. The way they were treated after March 2020 put me in mind of Kipling’s line about the ‘angry and defrauded young’.But taxing older people more, and setting up the full intrusive mechanisms necessary to assess the value of their homes, will not do younger people any good.Indeed, the idea of sending inspectors to see how much your house is worth recalls Pitt the Elder’s great speech against the excise duty on cider in 1763:‘The poorest man may in his cottage bid defiance to all the forces of the Crown. It may be frail – its roof may shake – the wind may blow through it – the storm may enter – the rain may enter – but the King of England cannot enter! – all his force dares not cross the threshold of the ruined tenement!’No, if we want to help the younger generation, we should do so directly. Cut their taxes. Build more houses. Remove the regulations making it harder for them to find work. Stop the nonsense of pushing half our school leavers into university courses whose costs, in many cases, they will never be able to repay.Do these things and we will make this a country where ambitious young people work, build and flourish. Our deficit will fall, our economy will strengthen and, who knows, we might not have to cut the state pension.Daniel Hannan is Director of the Institute of Economic Affairs.