How many times has a lovely group meal been soured by disagreements or awkwardness about sharing the cost? The responsibility of sorting it out has sometimes fallen to me, ostensibly because I am good at maths. Of course, it’s not really about maths at all. It’s about finding the right compromise in dividing up the cost which is easy but also fair.
Easy is dividing the bill equally – depending slightly on the number of your party. Although dividing a bill by 11 or 13 may not be the most straight forward, actually settling on a basic amount each which will cover the cost of the bill with something of a tip is easy enough. It might even be fair as well, if you all ate similarly priced meals and drank tap water. Unfortunately this usually isn’t the case. Some people choose more expensive meals than others. Some people will choose more drinks or have a starter or dessert.
The other easy option is to ask people to contribute what they think will cover the cost of their meal. Unfortunately this only works if people are more or less accurate and honest or over-estimate the cost. Sometimes this works brilliantly. There may be difficulties in sorting out change for people but more awkward problems arise when the collected pot does not cover the bill amount. Some people usually end up paying more than they wanted so that the bill gets paid.
Is it fairest to carefully police making sure everyone pays for what they ate? Or is it fairest for the people who can afford more to throw extra money into the pot so anyone struggling doesn’t have to worry? Of course, people may take advantage and it may be best to agree what you will do beforehand. A number of times my efforts to economise by ordering relatively low priced meals have been thwarted by people insisting that we split the bill equally because it’s easiest. If I’d known we were going to split the bill equally I would have ordered a more expensive main meal, a glass more wine and a dessert. Shucks.
I don’t eat out as often as I’d like but I do enjoy treating someone else once in a while. I remember people who treated me when I was a poor student and I like to pay if forward. I know there are lots of different restrictions on people’s budgets, but some people manage to be miserly even when they earn a packet. If you have money to spare, why not be generous with it? Support your local economy and help spread a little happiness. Actually I think generosity goes a lot further than money, but that’s not my main topic here.
I wanted to move on to mention much larger bills, for things like health care and schools, social services and police. It’s probably fair that we all contribute to these things, but some people and businesses can afford to give a lot more than I can. President Obama just made a speech arguing against tax breaks for the wealthy:
“They want to give people like me a $200,000 tax cut that’s paid for by asking 33 seniors to each pay $6,000 more in health costs? That’s not right, and it’s not going to happen as long as I’m president.”
I’ve said recently that I am not an economist, and I know that taxing the rich isn’t an uncomplicated solution to financial difficulties. People argue that wealthy individuals and businesses will just relocate overseas or find more convoluted ways of avoiding paying tax. I know some poorer people also avoid paying their taxes, but the impact is rather smaller. I think I’m with Obama on this one – it’s about what is right.
Ed Miliband’s ongoing policy review did include the option to say that you thought taxes on the wealthy should be raised, and I selected it. I’m not talking a massive raise, but something like taxing earnings over £100k at 50% and earnings over £1m at 60% would surely make a huge difference. Surely these sorts of policies would have popular support since most of us are not millionaires. I am still amazed that the UK electorate voted for a party represented by quite so many millionaires, although to be fair, some of those cabinet millionaires are apparently Liberal Democrats. Who used to support policies on increasing tax to pay for things like health care. Did I say disagreements and awkwardness? What was that bill amount again? I’m sure I didn’t order all that.