OK, even I can dismantle this point-by-point:
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1. Free-marketeers resent the bank bailouts. This might seem obvious: we are, after all, opposed to state subsidies and nationalisations. Yet it often surprises commentators, who mistake our support for open competition and free trade for a belief in plutocracy. There is a world of difference between being pro-market and being pro-business. Sometimes, the two positions happen to coincide; often they don’t.
Fair enough. Where we disagree is when you take this logic and turn it into:
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2. What has happened since 2008 is not capitalism. In a capitalist system, bad banks would have been allowed to fail, their profitable operations bought by more efficient competitors. Shareholders, bondholders and some depositors would have lost money, but taxpayers would not have contributed a penny (see here).
If the banks had been allowed to fail in this manner, the scale of chaos (cash machine networks shutting down etc) would have been enormous. The point was that MORE regulation was required to make sure they never got to a size which could hurt the economy in this manner if one of them goes under.
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3. If you want the rich to pay more, create a flatter and simpler tax system. This is partly a question of closing loopholes (mansions put in company names to avoid stamp duty, capital gains tax exemption for non-doms etc). Mainly, though, it is a question of bringing the tax rate down to a level where evasion becomes pointless. As Art Laffer keeps telling anyone who’ll listen, it works every time. Between 1980 and 2007, the US cut taxes at all income levels. Result? The top one per cent went from paying 19.5 per cent of all taxes to 40 per cent. In Britain, since the top rate of income tax was lowered to 40 per cent in 1988, the share of income tax collected from the wealthiest percentile has risen from 14 to 27 per cent.
Yeah, rich people refuse to make more money because they'll have to pay tax on it. If we'd only flatten the tax system, rich people would love to pay more tax! How the hell does this even pass as logic?
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4. Those of us who believe in small government are not motivated by the desire to make the rich richer. We’re really not. We are, in most cases, nowhere near having to pay top rate tax ourselves; our most eloquent champions over the years have been modestly-paid academics. We believe that economic freedom will enrich the country as a whole. Yes, the wealthy might become wealthier still, but we don't see that as an argument against raising living standards for the majority.
The collective raising of income levels, tipped disproportionately to the already-rich is exactly what happened under Tony Blair. This was because the 'economic growth' was fed massively by increases in asset prices rather than incomes. The reason the poor did mildly better was because the state stepped up public spending. Taking away that latter element would not 'enrich the country as a whole', it would entrench poverty, ironically making wages at the lower end even cheaper.
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5. We are not against equality. We generally recognise the benefits in Scandinavian-style homogeneity: crime tends to be lower, people are less stressed etc. Our objection is not that egalitarianism is undesirable in itself, but that the policies required to enforce in involve a disproportionate loss of liberty and prosperity.
Thus us absolute guff. He offers no evidence that egalitarian societies are less prosperous, and even blindly ignores his own example of the Scandinavian countries, some of the most socially-advanced and prosperous in the entire world.
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6. Nor, by the way, does state intervention seem to be an effective way to promote equality. On the most elemental indicators – height, calorie intake, infant mortality, literacy, longevity – Britain has been becoming a steadily more equal society since the calamity of 1066. It’s true that, around half a century ago, this approximation halted and, on some measures, went into reverse. There are competing theories as to why, but one thing is undeniable: the recent widening of the wealth gap has taken place at a time when the state controls a far greater share of national wealth than ever before.
A strange, yet crafty trick here. You state some facts, and then leap over to something else completely, implying that one thing supports the other. I've discussed the wealth-gap above.
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7. Let’s tackle the idea that being on the Left means being on the side of ordinary people, while being on the Right means defending privileged elites. It’s hard to think of a single tax, or a single regulation, that doesn’t end up privileging some vested interest at the expense of the general population. The reason governments keep growing is because of what economists call ‘dispersed costs and concentrated gains’: people are generally more aware the benefits they receive than of the taxes they pay.
Again, a giant logical leap there from Mr Hannan. Taxes privilege the vested interests? Then why do the majority of the population get a lot more out of the system than they ever pay in? It's called using the state to ensure a basic standard of living for all, also known as the beginnings of meritocracy, that thing you pretend to love so much.
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8. Capitalism, with all its imperfections, is the fairest scheme yet tried. In a system based on property rights and free contract, people succeed by providing an honest service to others. Bill Gates became rich by enriching hundreds of millions of us: I am typing these words using one of his programmes. He gained from the exchange (adding fractionally to his net worth), and so did I (adding to my convenience). In a state-run system, by contrast, third parties get to hand out the goodies.
More left=communist noise. Pretty much everybody likes meritocracy. Most people, however, realise that you need to have a framework in place to keep things fair, and to ensure that children aren't obliged to pay for the mistakes of their parents.
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9. Talking of fairness, let’s remember that the word doesn’t belong to any faction. How about parity between public and private sector pay? How about being fair to our children, whom we have freighted with a debt unprecedented in peacetime? How about being fair to the boy who leaves school at 16 and starts paying taxes to subsidise the one who goes to university? How about being fair to the unemployed, whom firms cannot afford to hire because of the social protection enjoyed by existing employees?
It's rich to talk about people being fucked over by the current system (which everybody agrees has gone awry) when what you're suggesting amounts to, essentially, a bonfire of the poor.
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10. Let’s not forget ethics, either. There is virtue in deciding to do the right thing, but there is no virtue in being compelled. Choosing to give your money to charity is meritorious; paying tax is morally neutral (see here). Evidence suggests that, as taxes rise, and the state squeezes out civic society, people give less to good causes.
Oh do fuck off
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