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The Poor Suffer Most from Deficits, UK Leader Says

Then Conservative Party Leader Iain Duncan Smith speaks in the House of Commons, London, on Oct. 29, 2003. (PA/PA Wire)

WASHINGTON — Former UK Secretary of State for Work and Pensions Iain Duncan Smith said the poorest people “suffer” the most when the government runs a deficit and resorts to raising taxes.

“I’ve been proud to be part of a process and a government in the last five or six years that set out with a very clear agenda for reforming welfare and many of those programs ran through. And many of them…actually have shown demonstrable change because they’re changing people’s lives and then improving their lives,” Duncan Smith said during a discussion on “economic reform and a new conservative agenda” held at the American Enterprise Institute.

“My concern was progressively over the last 12 months we had narrowed our focus more and more on financial savings coming from a small area called working age. And my comment was, if you just look for the money from that area, then what happens progressively is they bear a greater and greater share of the burden in a period when you’re looking to get yourself out of a deficit,” he added.

Duncan Smith, who resigned from his post last month, said there “needs to be a wider sense across the economy of how you bear the burden” of efforts to “rightly eradicate” the budget deficit.

“At the end of the day, the people that suffer if there is a deficit and ultimately higher taxes are actually those who are poorest, but you need to bear broader shoulders for that rather than just narrow it down to a group of people called working-age welfare groups,” he said.

“Conservatives believe in reforming lives so that they go on to improve their own lives and improve the lives of others around them. That is a critical message – you must keep going and exemplify the whole time. It’s not just a case of looking just to make savings from a specific group,” he added.

UN Ambassador John Bolton, who introduced Duncan Smith at the event, said some in the U.S. have called Duncan Smith a “hero” of welfare reform.

“Over the past six years, he’s engaged in really path-breaking work on welfare reform and has led the reformers in this country to call him a hero of welfare reform, which is well deserved.

Last month he stunned the political world on both sides of the Atlantic by doing something increasingly rare in politics,” Bolton said.

“He resigned as a matter of principle involving the government’s policies in the area for which he was responsible. The consequences of the resignation continue to reverberate in the United Kingdom, both on domestic issues and on the upcoming referendum on whether Britain will remain in the European Union,” he added.

Duncan Smith praised House Speaker Paul Ryan (R-Wis.) during his remarks at the event.

“In Britain, in June, we will hold a referendum on whether to end the power of the European Union’s supranational bureaucrats, judges and central bankers that they now have over us,” he said. “Personally, I want to have Britain completely free of the political philosophy that thought that the Eurozone was a good idea and which inflicted such terrible unemployment and austerity across Southern Europe. In America, I see much to admire in Speaker Ryan’s ambitions to devolve power to the states, especially in poverty-fighting policies.”

He also referred to Ryan when calling for a focus on “dismantling” crony capitalism.

“One of the most important components of new conservatism must be the dismantling of crony capitalism, something I know Speaker Paul Ryan is focused on. This speaks powerfully to people’s sense of fairness. This is a really important word for conservatives, I really genuinely believe. And losing that cause is real damage to us,” he said.

PJM asked AEI’s press office if Duncan Smith met with any members of Congress during his time in Washington. AEI contacted Duncan Smith’s representatives but did not receive a response.