So he was proud to announce a new scheme to help struggling young people. He will do this by allowing them to save £20,000 each year before they have to pay any tax on their savings. Clearly he thinks that is the sort of thing that it is fairly normal for a young person to be able to do. It would be extraordinary in the extreme if any young person without the assistance of a wealthy family could manage to save that amount from their wages.
For a start the majority of young people don't actually get paid £20,000 a year. If they do then they are probably part of the slightly less than 50% of the young population who possess a degree. If they studied for their degree without parental financial help then they are likely to be £27,000 in debt for their course fees plus whatever they have had to pay for their accommodation. A debt of over £40,000 would be quite normal. George did nothing to help them lower this debt. Instead he gave a tax break in the belief that they would be happily saving money and worrying about whether they might be putting away more or less than £20,000 each year!
Then he revealed an equal lack of understanding about how a young person acquires a home these days. Apparently he still believes they are all queuing up to buy and all they need is a little bit of assistance to put their deposit together and buy one of those affordable homes his developers will be building. So if a young person can save £4,000 a year the chancellor will give them another £1,000. Leave aside for a minute the unfairness that those who don't earn enough to save this get nothing whilst their richer friends do. Leave aside also the fact that if this works to help young people to be able to afford to buy then it will raise demand without shifting supply and so simply put up the cost of homes at taxpayers' expense. Consider instead the reality that 'affordable' family homes come in around £200,000 a year near me. In London it is £450,000. Ordinary young people who don't have help from their family simply cannot earn enough to service a debt like this on top of any student loan payments. The problem isn't just the deposit.
The vast majority of young people aren't sitting around asking themselves how many months it will be until they can buy their first home thanks to the Chancellor. They are renting on short term tenancies and worrying about whether their landlord will evict them after six months and how much they will have to pay to the letting agency to be allowed to get somewhere new. Many private landlords are, of course, thoroughly responsible. Not all of them are, with the consequence that insecurity about your home is a fact of life for many young people.
The idea of a home owner democracy where ordinary people get their own home out of their own efforts is a highly attractive one. Unfortunately the very people who profess to believe most strongly in it have made it a thing of the past. The rate of home ownership amongst the young has dropped by half. Renting is now the norm and it is not renting from a well intentioned council or a charitable housing association. The possibility of either of those two options has also become remote. Yet more council homes are being sold off and the Conservatives are trying hard to bully Housing Associations into agreeing to do the same after discovering that the government couldn't simply seize their properties by force as they had first intended.
It was therefore revealing that there was not a word in the budget about increasing the supply of rental properties or increasing the security of tenants who have to bring up their families living in them. There was a promise of tax cuts for the low paid.
This was also revealing. Osborne clearly believes that the biggest problem poor people have when their income goes up is that they lose some of that money in tax. It isn't. The biggest problem they face is that they lose so much money in benefits that they can often encounter losses equivalent to over 80% of their income. If he can think back far enough to the last budget then he might remember that he completely underestimated the scale of this problem with tax credits. Instead of learning the lesson he has repeated the mistake. If his aim was to help low paid tax payers he should have properly investigated the best way to mix tax and benefits instead of going for a simplistic measure that does little for the poor but gives every other tax payer a boost.
It is interesting to compare Osborne's serious lack of knowledge of the way the lives of ordinary people actually work with the degree of understanding he shows of the lives of those rather better off. He has looked after them quite effectively. You can earn more money before you pay the 40% rate of tax. You can avoid paying capital gains tax on more of your profits from the stock market. And you can collect dividends on your shares without the company you own paying quite so much in corporation tax. That will do very nicely I am sure.
Provided that you move in the same circles as George.