Government policy is to force the poor to be poorer

The Resolution Foundation tells us that the poor are budget constrained. That’s not all that much of a revelation but they’ve built a whole report around it. They gussie it up a bit of course but that is the central message.

In these troubled times poor folks haven’t been saving much. Well, yes, that’s what generally happens. In fact, that’s why the general assumption about any demand stimulation that might be done should be pro-poor. The poor spend all their money, the richer tend to save a portion. So, if we desire to have more demand in the economy it should go to the poor so that it is spent, not saved.

To complain about this point that is so well known seems a little odd to us. However, there is one little point in there which we think worth emphasising:

Second, the cost of certain items (most obviously food) has risen for many: promotions have been reduced and cheaper items are harder to obtain.

Food promotions - BOGOFs, three for twos, this product cheap this week only, these are pro-poor. This should be obvious given that observation that the poor are budget constrained. At which point we have government policy on the matter:

The popular “buy one get one free” and “three for two” deals will be banned in supermarkets in a drive to help the nation lose weight, although smaller stores will be exempt.

The government is demanding that the poor be poorer. We can’t help but think that this isn’t a reasonable aim of government policy. Actually, we’d mutter that it’s somewhere along the spectrum from misguided through to an aggression upon the poor.

But then as Bernard Levin spent those decades pointing out there’s little so dangerous as the Single Issue Fanatic. The groupthink about obesity is leading to this absurdity, that government is actively insisting upon taking the crusts out of the mouths of poor babes and children.