Economics guru warns Labour is 'taxing Britain to death' as Andy Burnham talks up 'public control' as a growth strategy

Labour has been warned it is 'taxing Britain to death' as Andy Burnham insists 'public control' can restore the country's fortunes.Eminent economist Arthur Laffer said another raid on 'wealth' in the looming Budget could be a 'disaster'. Mr Laffer - who has advised three US presidents and identified the famous 'Laffer curve' showing high tax rates can actually reduce revenues - urged the Government to cut benefits.Ministers should instead give people more 'incentive to work' by lowering tax rates, he insisted. The intervention came as the PM scrambles to cool market alarm about the state of the UK's finances and his array of spending pledges. Andy Burnham is scrambling to cool market alarm about the state of the UK's finances and his array of spending pledges Arthur Laffer - who has advised three US presidents and identified the famous 'Laffer curve' showing high tax rates can actually reduce revenues - urged the Government to cut benefitsIn an article for the Sunday Times after investors pushed up interest rates on Government debt, Mr Burnham said he was focused on 'stability'. 'That means a government that sticks to its fiscal rules, keeps the public finances under control, and gives those businesses the confidence to invest for the future,' he said. However, Mr Burnham also restated his determination to nationalise key parts of the economy - which could cost billions of pounds. 'Over the past few decades, we've given up control of our energy, our water, our transport and more,' Mr Burnham said. 'The promise was that privatisation would make things work better, but instead we've ended up paying more, often for a worse service.'Mr Burnham argued that 'greater public control' would help 'bring down the cost of living for people over the long-term'.'We're used to being told that more public control and successful business are opposites,' he said. 'But that's simply not true. You can't build a dynamic economy on crumbling infrastructure. 'Businesses need affordable energy, reliable transport and decent infrastructure just as much as families do. 'Getting those basics right doesn't hold them back, it gives them something solid to build on - and it makes our towns and cities better places to invest in too.'Mr Burnham and Chancellor John Healey - who will deliver a crucial speech in the Midlands tomorrow - have refused to rule out more tax increases at the Budget.That is despite Labour already having pushed the burden towards an all-time high since taking power in 2024. Global anxiety over the effects of the Middle East crisis and concerns about the possibility of an AI 'correction' have wiped out much of Mr Healey's 'headroom' against the fiscal rules. There is also huge pressure for more spending in areas such as defence and to meet Mr Burnham's other promises.But in an interview with the Sunday Telegraph, Mr Laffer cautioned that more tax hikes would be counterproductive. 'If you tax people who work and you pay people who don't work, don't be surprised if you find a lot of people not working,' he said.'Why don't you just lower their tax rates and let them find the incentive to work?'The 86-year-old added: 'The thing is to create jobs, not to pay people not to work.' Mr Burnham and Chancellor John Healey (pictured) - who will deliver a crucial speech in the Midlands tomorrow - have refused to rule out more tax increases at the BudgetMr Laffer insisted that, historically, efforts to change the distribution of income only succeeded 'in making income much more scarce and poverty much more plentiful'. 'You are going through a tailspin of this in Britain,' he added. 'I would love to see Britain become prosperous. That's my dream. '[But] your record is not illustrating a good set of policies. It's really indicating exactly what you see when [an] economy gets in the death spiral.'He added: 'I have never heard of an economy being taxed into prosperity. What's happening is, Britain is taxing itself into death. 'Your problem is not too little revenue. Your problem is too little growth, too little prosperity.'