What the government fails to recognise is that it is effectively telling high-earners that they must pay more tax. This is because the government must bow to the so-called popular demand that more of the wealth producers' income be sent to the Treasury rather than spent on their own (lavish) lifestyles. Rather than adopt a Churchillian "never give in", the government has announced that, under pressure, it will limit bonuses, raise taxes and fees, and make life uncomfortable for high earners — the very people it is counting on to come through the door now that "Britain is open for business," rather than hop on a plane to Switzerland.

It is important, of course, not to panic and distort policy in response to threats from high earners to pull up stakes. For many, fresh mountain air is no substitute for the cultural attractions of London, and a more benign tax environment no cure for raging boredom. 

But it is equally important not to ignore the many signs that the combination of quasi-official hostility to high earners — not unusual among the classes that benefit from inherited wealth — and a draconian tax regime just might trigger more of an exodus, or discourage newcomers, to an extent that conflicts with policies aimed at producing a speedy and robust economic recovery. And there are many such signs:

• the Adam Smith Institute says its studies show that 500 top managers of some 80 hedge funds have left the country
• the Swiss Funds Association reports that 20 to 25 hedge funds have left the UK for Switzerland in the past year
• a Lloyds TSB poll of almost 1,000 people with savings or investments in excess of £250,000 found that 36 per centsay they want to emigrate, and 14 per cent are likely to leave within two years

Sooner rather than later the government will have to decide whether it wants high earners to enter its open door, keeping in mind that the richest 1 per cent of Britons account for about 25 per cent of all taxes paid into the Treasury. It seems that it does, given the Prime Minister's desire to allow the immigration of relatively well-heeled entrepreneurs. But then again, it seems that it doesn't, because it threatens to tax away what many in the coalition seem to regard as ill-gotten gains.