What a cowed people so many of us have become, demoralised and incurious. We perk up gratefully at state spending aimed in our direction, but don’t stop to ask where the money is coming from.

We cheer rises in the minimum wage while simultaneously bemoaning the lack of jobs for young people. We applaud attacks on landlords, and wonder why there are so few properties to rent.

Our politicians, I’m afraid, have got the measure of us. They know how to keep a sullen, statist and submissive electorate in check. This week, we have had the Budget we asked for.

Consider, first, the big picture. Commentators had feared a pernickety Budget, one of tiny tweaks, micro-subsidies and fiddly adjustments. In the event, it was almost as if the Chancellor was parodying those predictions. He dispensed small sums sector by sector, charity by charity, almost constituency by constituency.

Nothing was too minor to merit a Budget line: £15 million for Dolly Parton’s literacy initiative, £10 million for craft brewers, £6 million for an events space in Glasgow.

It is not just that all this must be paid for. It is that every grant, every rebate, every exemption, further complicates an already complicated tax system.

A s the tax regime becomes more administratively expensive, the ratio of pain caused to revenue raised worsens.

Tolley’s Tax Guide, the semi-official key to understanding our tax code prepared for accountants and other advisers, has grown from 728 pages at the start of the century to 1,024 today. Successive Chancellors are to blame. Gordon Brown was a particular offender, though George Osborne also has much to answer for. No previous Budget, though, created so much needless complexity for so little meaningful change.

How many of us understand that the complexity of a tax system is as bad for growth as the overall level of taxation? The two things are correlated, in the sense that getting rid of all the fiddly little exemptions allows you to lower the rates, rather as collapsing all the holes in a Swiss cheese would lower its height.

But even if that were not true, the complexity of the system, the time that must be spent on accountants, the perverse incentives, all act as a major drag on growth.

The trouble is that the number of voters who will object in principle to a complex tax system is tiny compared to all the groups who will delight in a bung to this or that cause. The same is true of the overall level of tax. The most significant number from the recent budget never passed John Healey’s lips. Half a million people are being dragged into the higher-rate tax band because the Government has frozen the thresholds while inflation has pushed up headline salaries.

The very notion of a ‘higher-rate taxpayer’ bears no resemblance to what it used to mean as recently as the early 2000s.

You might think there would be protests about all this. When all the numbers have been run, we may very well find our taxes are higher than they have been since 1945. Then, we had mobilised all our resources to defeat Hitler. What is our excuse this time?

The Institute for Fiscal Studies think-tank says this will be the worst decade for household incomes since the Second World War. Are we capable of drawing a line from the individually popular spending increases to this dire fact?

As long ago as 1850, the great French economist Frederic Bastiat got to the heart of the issue: ‘There is only one difference between a bad economist and a good one. The bad economist confines himself to the visible effect: the good economist takes into account both the effect that can be seen and those effects that must be foreseen. This difference is tremendous, for it almost always happens that when the immediate consequence is favourable, the later consequences are disastrous.’

In other words, raise the minimum wage and you might get an approving hearing on BBC radio, from Left-wing think-tanks and ordinary people who worry about the lot of the lowest-paid. But consider the ‘later consequences’ – fewer workers hired, a lower overall tax take, more people on benefits.

As a nation, we have been failing Bastiat’s test for a long time. We went along placidly with Net Zero, and now rage about our electricity bills. We don’t want houses built anywhere near us, but we complain about the price of renting and buying property.

We want to make it harder to fire people, and then wonder why firms are reluctant to employ them.

Most consequentially, we demanded – partly thanks to the BBC – a strict lockdown, and have railed ever since at the tax rises and rampant inflation that were its ineluctable consequences, blaming our politicians for the slide in living standards rather than looking in the mirror.

Ah, the lockdown. That was when the balance tilted definitively against freedom. The sight of all those trillions of pounds being conjured into existence for furlough payments, Wagamama lunches and business grants convinced us that there was, after all, a magic money tree. The idea of having to pay it back, either through spending cuts, tax rises or inflation, leaves a lot of people genuinely outraged.

Those are the parameters within which our political parties now operate. The huge increases in spending that were authorised in March 2020 as a supposedly emergency measure are now treated as an immemorial part of the constitution, a birthright. We can hardly blame John Healey for leaning into the public mood, giving us the goodies we want while refusing, just as we refuse, to consider the second-order consequences.

The British State is now becoming a machine where taxes go up automatically through fiscal drag, but the demands of the healthcare and social security budgets are so vast and insatiable that there is never enough.

We are borrowing £115 billion a year, and spending almost every penny of it on fending off past creditors – that is, servicing interest on previous borrowing.

The Chancellor acknowledges that problem. He says, and he is right to say, that there is nothing progressive about spending more on debt interest than on education and defence put together. But, like his predecessors, he keeps spending today while talking vaguely about some belt-tightening further down the line.

In the meantime, in the kind of move that would disgrace a Latin-American caudillo, he is literally paying money into people’s bank accounts: £100 for every household in a council tax band of A to D, the swing voters.

We can sneer. We can call it populist. We can call it crowd-pleasing. But the reason it is popular, the reason it pleases crowds, is that, as a country, we keep failing the Bastiat test. We vote for freebies, and gaily assume that the bill will fall on someone else: landlords, banks, energy companies.

We seem unable to process the concept that all these taxes, in the end, fall on us. Your bank will no more pay the bank levy than your house pays the council tax, your car the excise duty or your TV the licence fee. You will pay as a depositor or a borrower. All taxes fall on human beings.

If we refuse to understand that, if we keep voting for more and more ‘free’ stuff, we can hardly blame our politicians for the cataclysm that will surely follow. We are getting precisely what we demand.

Lord Hannan of Kingsclere is an independent peer and director of the Institute of Economic Affairs.