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The Forum > Article Comments > Is Australia a ‘high taxing’ nation? What is the responsible answer? > Comments

Is Australia a ‘high taxing’ nation? What is the responsible answer? : Comments

By Tristan Ewins, published 5/5/2006

The oft-made accusation that Australia is a high taxing nation deserves serious scrutiny.

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The comparison with either Eastern Europe or Western Europe countries is generally poor, since it leaves out some rather important cultural differences

1) People in Europe tend to speak the language of the country they come from. For the majority of the populations there, this is a huge factor in leaving. Thus the governments can essentially place whatever burden of tax they want on the population, and there is nothing much people can do about it. This is unlike Australia, where people speak English. If you must insist on excessively taxing the most mobile people (i.e., entrepenerial and motivated single, cash rich, asset poor people -- i.e., young doctors, teachers, engineers...) at such high rates, then it is much more simple to simply pick up and move to another country if you speak English, than, say, Finnish.

2) Movement of people in Europe tends to be to a mix of other high tax European countries, and to a lesser extent, lower tax countries like the US. Excluding the UK (where wages are higher for professionals, hence causing the same effects as lower tax anyway), movement of people of from Australia is almost always to lower tax countries (US, Asia). Thus, the origin of competition for people sick of high tax rates is different, and the competition is much greater for someone from AUstralia comapared to someone from, say, Germany.

Thus, before you suggest making tax rates even higher, you need to consider the loss of people this is likely to cause, and the overall effect on the economy (and the effect on the more specific things like medical services, the science and technology industry, and so forth). If you don't believe its a problem, then you might like to check the ABS statistics that show an accelerated number of people leaving Australia, and indeed who those people leaving are (well educated and motivated young professionals -- although those statistics are presented elsewhere). Alternatively, you could just look across the Tasman and see what effect higher wages in Australia have had on New Zealand.
Posted by rc, Friday, 5 May 2006 9:12:20 AM
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I prefer a solution that grows the pie rather than trying to redistribute the existing one. Socialism is not the answer.
Posted by jeremy29, Friday, 5 May 2006 10:03:47 AM
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You've never heard the saying money makes money? It's alright for the pie to grow, but if it grows in the wrong places it makes NO difference to the social welfare that Mr Ewins was talking about in his article.

Free market capitalism doesn't work when it's relied on to provide for the needs of the underprivileged, nor does it build infrastructure (as, just like the underprivileged, infrastructure doesn't produce recognisable profits). We'll just have to wait for the next lefty government (if there is one remaining, which I doubt) to provide us with our "needs" and enable us to catch up on the last decade or so of right wing economic ignorance and ready us to survive the next spate of right wing economic leanness.
Posted by hadz, Friday, 5 May 2006 10:37:51 AM
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Dividend imputation has been a tax bonanza for the Federal Government. Company tax receipts have been growing at a much faster rate than for personal tax. Shareholders prefer companies that pay tax because they pick up the credits and pressure companies to pay fully franked dividends. The superannuation funds are the biggest beneficiaries of franked dividends because their tax rate is lower than the company rate and the funds are credited for the difference.

Scrapping imputation would encourage companies to move offshore as James Hardie has done already. Tax receipts would decline as companies reorganised their operations to pay less tax.

The author also talks about Capital Gains Tax concessions but this is misleading. What concession is he talking about?

Prior to 1985 there was no CGT. In 1985, the Hawke Government introduced CGT but indexed the cost base to inflation. The Howard Government later scrapped indexation but halved the tax rate to compensate for inflation. The Hawke system was good for long term investors and tough on short term and the Howard system the reverse.

To tax capital gains without some sort of compensation for inflation would be disastrous. Most long term investments for capital gains would become uneconomic, particularly housing.
Posted by Rob88, Friday, 5 May 2006 11:54:28 AM
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Firstly - re: the 'brain drain' - Australia already has a net increase in population from migration including skilled migration - the so-called 'brain drain' simply isn't an issue. Also - many people in Western Europe already speak English. But they don't migrate. They enjoy superior social services and superior working conditions. Home is home. Why would they want to move?

Secondly - re: dividend imputation - superannuation is already tax free - dividend imputation, in this case, represents a 'negative tax' - of course superannuation could also be made exempt from make proposed changes beneath a certain wealth threshold. The vast majority of shares are owned by the top 10% of wealth holders. (actually - even the top 1% hold a majority) Thus this would be a very progressive change.

Finally - re: capital gains tax concessions. Capital gains tax is now only applied to 50% of assets - this needs to be changed. Also there are four small business capital gains tax concessions that need to be reviewed - including a 15 year exemption.

also - see here: http://www.abc.net.au/am/content/2004/s1156695.htm

Capital Gains Tax concessions cost over $3 billion in lost revenue - enough to pay for the private health insurance rebate - and enough to make significant inroads into hospital waiting lists.

Tristan
Posted by Tristan Ewins, Friday, 5 May 2006 12:36:50 PM
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Tristan, you could have fooled me about there being no brain drain (and probably anybody who works in any science related area, for that matter). Simply adding up who comes and who leaves doesn't tell you very much at all. If I get one plumber and lose one biotechnologist, there is no meaningful comparison to be made. Both would useful to Australia.

I think you need to read some of Greame Hugo's work, who is the top demographer in Australia for this sort of thing, who argues that _at present_ things might be relatively balanced, although it is very hard to track things like the best of the best leaving, and relatively inexperienced people coming, which appears to be what happens in Australia's case at least in the areas where meaningful data has been collected.

In any case, even if things were equal now (and even if you really believe that people leaving and coming are two sides of the same coin -- which many people would argue are not) it seems reasonable to suggest that as mobility rises and as populations age in the future, many countries will offer greater and greater incentives to try an plug holes in their workforce (the recent US visa for Australians being a good example). Increases in taxes -- which inevitably fall disproprotionaly on younger hard working people, isn't going to help this.

Also, your comment on Western Europe is off the mark. The vast majority of Western Europeans don't speak (let alone write -- a prerequisite for many jobs) English fluently at all (go to France for a holiday if you don't believe me), and even for those that do, speaking your native language is undoubtedly a big cultural factor in why many stay, and one reason they are less mobile than AUstralians. Despite this, they still have the same problem as Australia (albeit to a lesser extent), where many of the smartest people still move to the US (figures from the NIH show that European scientists number in the millions in the US -- this is a huge loss to them).
Posted by rc, Friday, 5 May 2006 2:12:35 PM
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Clearly the ‘Brain Drain’ applies to Tristan. Your brain is clearly drained if you can write such nonsense. ‘Superannuation is tax free and imputation a negative tax’. What strange drug have you been taking?

This is how it works with imputation. The shareholder gets a credit for the tax paid by the company on their shares. If your marginal tax rate is 30% and the company paid a fully franked dividend, then no more tax is payable by the shareholder. Super funds pay tax at 15%, so they get a credit for the extra tax paid by the company.

Under the old system favoured by Tristan, dividends were taxed twice, firstly in company tax and secondly in individual income tax. Typically, the government took 75% of the dividend in tax. Consequently dividends and company tax receipts were small and tax avoidance was big time. Imputation was an important reform introduced by the Hawke government.

Capital Gains: CGT concessions cost the government nothing, instead it encourages investment. The tax regime proposed by Tristan would make nearly all investment in real estate uneconomic. The effect of inflation is very real over the long term and coupled with a high tax rate would cause a mass exodus from real estate investments. Probably most people would just invest in their own home until Tristan decides to tax that as well.
Posted by Rob88, Friday, 5 May 2006 2:19:34 PM
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Tristan makes some good points. I am suspicious of calls to lower the top income tax rate even though I would benefit. If it is to be contemplated it should be paid for by reducing 'middle class welfare', and increasing other wealth taxes like CGT and reigning in negative gearing. I'm a residential property investor myself and have benefited from both CGT and NG, but I fail to see what benefit these tax regimes have had for the economy or society generally. And, similar to another poster, I would like to see the pie grow. But at present that would seem to mean just digging up or chopping down more of Australia to be shipped of to China & Japan to return in the form of global warming. Smart ways to grow the pie - now there's a good topic for online opinion.
Posted by PK, Friday, 5 May 2006 2:23:35 PM
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re: capital gains tax and inflation - the problem you suggest could be tackled by reintroducing indexation as an alternative to the 50% tax free status.

re: superannuation - if imputation is at 30% and super tax at 15% - then effectively you have a negative tax.

see: "Investments within super that fund pensions are officially in a tax-free zone for both income tax and capital gains tax. If there is no tax against which to offset imputation credits, the credits become refundable. In other words that means their full value is added to superannuation pension investment earnings as a tax refund. " http://www.easeaccounting.com/news/default.asp?idNo=809

Tristan
Posted by Tristan Ewins, Friday, 5 May 2006 2:34:20 PM
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This article must be meant to be a joke.
Posted by baldpaul, Friday, 5 May 2006 5:05:44 PM
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we are an uncomptetitive country that offers little incentive to stay here once any company goes international.

Personal Tax is high, super has the guts taxed out of it, we have capital gains tax, GST and the like taking from us all the time.

You wonder why places like Malaysia are booming and we are waining.
Posted by Realist, Saturday, 6 May 2006 9:55:26 AM
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In other countries, it is termed as Third world Corruption, but in Australia, First world Corruption is called Social Responsibility. How Orwellian and Marxist can you get than that?
Philosophical Assumptions and depravity, verses Real ethics and behavior. Sorry, Australia does not rate any more, Looting by statute is epidemic and worshiping Misery has overtaken the Metaphysics of reality.
The Future is not good; there is no value or ethics any more, The Looter/Moocher partnerships have made sure of that.
And we let it happen.
There will never be enough Loot to satisfy them, they are greedy in their own depravity. Such is the scourge of fraudulent politics, and Socialisms destruct concepts.
The ship is sinking quite fast, and only the strong will survive this batch of Looting. Not the Rich, but the ethical and knowledgeable will survive ONLY.
Posted by All-, Saturday, 6 May 2006 12:22:08 PM
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I admit that I made an error in my comments re: superannuation. Unfortunately, this is what happens when you make comments 'on the run' without taking the time to engage in proper research. There is, however, no need to be personally insulting in order to make the point.

The article, however, (as opposed to my rushed comment) IS well researched, Its arguments stand. In order to match Finland - the most competitive economy in the world - we would need to raise expenditure by $160 billion. Australia is a very low tax current by international standards. If we are to improve infrastructure, education, health - there is no option but to increase expenditure. A few years ago progressive economist John Quiggin estimated that $5 billion would be needed to address the hospitals waiting lists crisis alone. The we have the spectre of the Snowy Mountian Hydro power station being sold off to pay for limited upgrades of education infrastructure in Victoria because the government is 'strapped for cash'. The PBS is increasingly losing coverage and - when you include aged care - and the ageing population - we will soon need to reconsider our status as a 'low tax' nation.

R&D credits and industry assistance, improved aged care, a national fast train network, roads, hospitals, preventative health care, Medicare subsidy of other health services including dental care, public broadcasting, schools, universities and TAFES, university courses, welfare, indigenous services, representation and self determination, alternative energy sources, Commonwealth scientific research, improved and cheaper public transport, public housing, defence, tax credits for low income earners, child care provision and sudsidies - all these and more need to be paid for somehow.

It's time to wake up to the fact that we can't have our cake and eat it too. High quality public services and infrastructure need to be paid for - and tax cuts lead into spending cuts further down the line.

It's also time we reconsiderd the case for redistribution in the Australian tax system given increasing social stratification and successive tax cuts aimed at the 'top end of town'.

Tristan
Posted by Tristan Ewins, Saturday, 6 May 2006 12:59:47 PM
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No Tristin, That sounds like a full on Communist state with all the Philosophical constructs and dialectics combined to a Utopian existence. A fourth Dimension Hypothesis if you like.

Reading through what we have to fund through taxes, we have nothing of the sought as you explained.
Supposedly in record employment, but a welfare bill of 81 billion dollars?

• 8 million employed, but ……. 30 to 40 % of those employment figures are { Local – State-Federal governments and bureaucrats} So how many working productive Australians are left to fund everything else, with the other 14 Million populous who seem to dwindle in to the twilight of non productive but drawing on the resources as well as the Labyrinth.

The Equations ends up the same, We are Taxed to near three quarters of our productive efforts across the board, and everything is falling apart around us, from Local , State , Federal levels.

A whole lot of Looting going on. And not much value for my Tax dollar.
You may be surprised, but our defense is subsidized by the great Satan, yes America. Such is the parasitic drain of the Looters in Australia. That is the only thing saving us from sure Invasion, we are under Occupation as it is, just not finalized.
I begg you to reconsider the economics, and ask Mr Quiggins how much loot he was paid from Government coffers last year? There, you could fund a new Hospital. Great value hay.
Posted by All-, Saturday, 6 May 2006 1:50:55 PM
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Let's also tax the air. Hell, make that progressive too. People with bigger lungs should not only pay more tax, they should also pay a larger portion of tax. How dare they have bigger lungs.

In fact, forget about tax all together. Our earnings might as well belong to the government. Everyone knows the government is better at spending our money than we are - that's why Tristan wants the government to take even more of it.

And that's exactly why he should learn some basic economics.
Posted by G T, Saturday, 6 May 2006 2:50:19 PM
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"MOVIN' OUT"
Tristan works at the grocery store
Savin' his pennies for some day
Mama Leone left a note on the door,
She said,"Sonny,move out of the country."
Workin' too hard can give you a TAX ATTACK ..ACK.. ACK ..ACK
You oughta know by now
Who needs a tax on our little shacks
Is that all we get for our money?
It seems such a waste of time
If that's what's it's all about
If Tristan's tax is movin' in,then I'm movin' out.

Now Tristan put on some Billy Joel and sing my Lyrics.
Posted by Arjay, Saturday, 6 May 2006 4:48:37 PM
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Tristan,

When you think about tax (and wages for that matter), you really need to think in terms of competitor countries, and not all countries. International comparisons between Australia, and, say, France or Estonia (or a host of other countries) are basically meaningless, since the extent that Australia is in competition in various industries (and for people, for that matter) with them is not especially large. If France changed its tax rate to 10% tommorow, I doubt it would make much difference to Australia. In addition, as I pointed out before, there are also vast cultural difference affecting the movement of people differently in those countries.

Alternatively, if you look at Australia's main trading partners -- the US, New Zealand, Japan, China, etc. and countries likely to be in competition in the same industries that Australia is either good at now, or wants to be good at some time in the future (e.g., biotechnology, international education) then you will get a much fairer picture. Was the lower tax rate in Singapore responsible for the growth of their biotechnology industry to some extent at the expense of Australias ? and is, say, their idea of expanding their universities into the international market likely to come at Australia's expense (both via direct competition, and via the employment of some of the cream of Australia's scientific workforce) ?

If you think the answer to the above two examples is yes (the first surely is, the second we will find out), and if you think tax rates play some role in that (which they surely do), then that is the comparison you need to make.
Posted by rc, Saturday, 6 May 2006 5:06:36 PM
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Before the Internet, op-ed columns about the sclerotic European economies went unchallenged, but now the truth is out there for those who want to look for it. The Nordic countries are just as good as the Anglosphere countries in creating wealth and jobs. The US Bureau of Labor Statistics runs a comparison of unemployment in 9 countries. Any differences between Australia and Sweden are marginal. We are slightly ahead now, and they were in 2003. The Nordic countries are also producing their wealth in the context of stable populations. They are not participating in a vast pyramid scam, selling their country off in smaller and smaller pieces to more and more people, to the point where they have permanent water restrictions in most of their major cities.

By other measures they are well ahead. rc would like us to copy the US, but despite its wealth, the US is well behind the Nordic countries when it comes to literacy, life expectancy, infant mortality, percentage of the population living in poverty, etc. Mishel, Bernstein and Schmidt in 'State of Working America' (2001) compared the mobility of workers in America with 7 European countries, including three Nordic ones, and found that the US has the lowest share of workers moving up from the bottom fifth of any of them. Apparently it is Europe that is the land of opportunity and not the US. In Finland the top tenth of the population has 5 times as much income as the bottom fifth, but it is 12.7 times in Australia (CIA World Factbook).

Language is not an insuperable barrier, as we see from our own migrants. If rc could greatly increase his income by learning fluent Estonian he would do it in a matter of months. Perhaps all the talented people don't leave because they like living in a decent society where mentally ill people don't have to live on the streets and poor people can get their teeth fixed. If our politicians worked as hard on getting us into the EU as on justifying poverty and inequality, we could probably join them.
Posted by Divergence, Saturday, 6 May 2006 5:55:12 PM
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Divergence : I don't think we need to become like the US. In fact, I was quite happy to see that the author infact proposed some taxes that were aimed at asset rich/cash poor people. I think you could in fact raise a huge amount of money simply by adding people's home residence into an assests test before giving them government benefits. However, this is politically unpopular since it would mean retirees would need to take out negative mortgages on their homes, so we are stuck with a situation now where people with huge assets are being subsidized by people poorer than themselves, and this problem is only going to get worse as the population ages. Thus young people carry the burden of tax and this tax helps keep asset prices inflated. No wonder people get cheesed off with it.

In addition, I'm just trying to give a realistic future scenario for what will happen to young professionals in Australia. If you really don't think the global movement of people from one place to another is a problem (or going to be) for Australia (it already is in some industries -- look what happened to Australias biotech industry, look how many Australian teachers work overseas, etc.), then, as I pointed out, look at New Zealand, or note that 5% of Australians live overseas, and those 5% are of course the top of the top in terms of education and work skills (excluding a few backpackers). Personally, I don't know why Australians are so willing to leave compared to people Europe, but the fact is they do and that the number leaving is increasing. The most likely factors are language (cultural), and better working conditions, whether they be higher wages (the UK), lower taxes (Asia, the US), or better conditions (the US -- particularily for scientists). In case you have another reason, I'd love to hear it.
Posted by rc, Saturday, 6 May 2006 6:28:40 PM
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Hang on, whoah lol. The CGT was lowered, but inflationary effects were not accounted for under the new system. If you faithfully put your hard earned savings into the stock exchange, to provide capital
for Australian companies, taxing that money only once, makes perfect sense. Even now, inflation is not accounted for. Yet if you put your money into your McMansion and walk away with half a million,
its all tax free. Sounds just and fair to you? Think again.

Yup, students should help pay for their own education. The lawyer who charges 400$ an hour for his time, should not expect the small working man, to pay for it.

Kerry said it right "The Govt don't spend it so wisely, that we should give them any extra". Perhaps they should learn to stop peeing it up against walls, before they want an even higher share of GDP to pee with.
Posted by Yabby, Saturday, 6 May 2006 9:59:48 PM
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I'm with Yabby,the more we give Govt the more the bloated bureaucracies grow.Our present Govt likes churning so they can tax us more with bracket creep and bribe their way back into Govt by giving us back our own money.

In the 1950's we had an average income tax of 11% of total wages,they were able to build The Snowy Mountains Scheme and all manner of infratructure.Now we have $ billions reaped in taxes that go towards paying 1.5 million Australians of working age to be totally idle.That is one of the major reasons why there is no money for infrastructure.We have become "The Can't Do Generation."

The Future Fund of $18 billion is solely for unfunded Super Liabilities of the Federal Govt.By 2020 the Govt will need to find $140 billion to cover public servants Super and this does not include the State Govts which have far more public servants.

If we tax more,there will be less productivity,business and investment will move overseas,and we will have a lot more than the present 1 million Aust professionals working overseas.Remember the UK before Margaret Thatcher took over.It was a basket case.

We can be far more clever in both our approaches to tax and making everyone ,including Govt pull their weight.

This article smacks to me of some uni students realising how hard the real world is and yearn for a cushy Govt job that will molly coddle them for life,just like their parents have done so for the last 20 yrs.
Posted by Arjay, Saturday, 6 May 2006 10:40:04 PM
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In terms of direct taxation, Austalia is a relatively high taxing state. However, that really does not matter. What matters is how much of the purchasing power of the individual dollar is absorbed by pernicious indirect, as well as direct tax.

On the combined direct/indirect basis of assessment, Australia is one of the lowest taxed of the Developed countries.

The interesting part of the analysis is not to ask the tax question by itself. The real question is what is the “Life satisfaction levels. of those who are highly taxed, versus those who are lowly taxed.

A brief review of the data available from nationmaster.com reveals a negative correlation of -.32 between levels of overall taxation and levels of life satisfaction, in other words, the higher the tax regime, the lower the life satisfaction index.

Anyone who thinks there is any merit in taxing people should think again. Using taxation to engineer the ideal society depends on ones definition of what an ideal society is.

Based on my personal values, which emphasise self reliance and reward for effort (distinct from the dead hand of socialist levellers and bureaucratic intrusion into every aspect of our lives), the less government pretend they know what they are doing and the less they tax us for not doing it well, the better.
Posted by Col Rouge, Sunday, 7 May 2006 9:49:28 AM
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Maybe I am missing something in this debate.

One of the problems I see in relation to the tax reform agenda is that we don't have an audit of where the money from taxes is actually spent.

For example: people such as Richard Pratt are given money from the fed govt, BIG BICKIES, with no mutual obligations or audits. Holden and more recently Ford motor companies have also recieved grants.

Now these and many other incidences of welfare for the rich, might have a reasonable explanation, but I would like to see the actual figures.

The medicare levy is a percentage, so people earning 24000 pay less than those on 80000. Where is the money going? Why should a person who is already paying heaps of medicare levy be expected to pay private insurance. How much have Drs income risen/fallen- I would like to know hard numbers. Where is the money going?

The way I see it, the figures on money that goes to the government to deliver services etc for the community are not available or clear. It all seems to be secret.

I want to see the figures listing govt spending on propaganda, opps I mean public information campaigns, and support for the wealthy, infrastructure etc.

The impending budget does not give any hard facts and figures, just smudgy make believe numbers.

Put simply, before we go any further into tax reform, lets have the figures. I for one want to be fully informed.
Posted by Aka, Sunday, 7 May 2006 11:47:34 AM
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re:Sweden-and-the-social-democrats:Why-would-people-consistently vote-in-a-government-that-'doesn't make them happy'? Also see-the-results-of-a-happiness-survey-for-high-taxing-Sweden-and-the-Netherlands: http://www.fsmitha.com/world/sweden.html

"The happiness survey, described at Nationmaster.com, has the people of Sweden third in the world, behind Iceland and the Netherlands."

re: figures - according to 2001 figure: "Australia [spent] a mere 33.3% of GDP in government expenditure, compared to 43.4% in Canada, 48.1% in France, 48.7% in Finland, 54.9% in Denmark, and 56.9% in Sweden."

This means less money for health, infastructure, aged care and education. Aged care, in particular, is facing a looming crisis - and already nursing homes are grossly understaffed. What is more - what social services we don't pay for progressively through taxation we end up paying for on a 'flat' basis through user pays charges. Take Citylink for instance. With user pays charges and or Public Private Partnerships, user pays charges consist the effective same as an 'up front, regressive tax' anyway. Also - take the growing proportion of university places provided for now by upfront fees.
Then take public transport - it is estimated in Victoria that it would take $300 million to make public transport free - and thus greatly increase patronage and reduce road congestion. But given the importance of health expenditure and education infrastructure the government just doesn't have this kind of money to spare.

BTW - low tax regimes have led to one of the worst health systems in the developed world in America - and we are slowly but surely heading down the same path.

re: corporate welfare - overall we have space to move on corporate taxation - overall corporate tax should rise - and even with a four per cent increase we would still have lower taxes than the Americans. While some might think this would have a negative effect on investment, there is also the attraction of better quality infrastructure. The BCA wants better infrastructure - it just doesn't want to have to pay for it. Strategic tax credits for some industries and enterprises, however - including R&D concessions - are to the benefit of the Australian economy and can be defended on this basis.
Posted by Tristan Ewins, Sunday, 7 May 2006 12:20:16 PM
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Ahh Tristin, but of course you make some classic mistakes, I will just put it down to your youth :)

Happiness is relative. If you are in Tasmania, just emerging from a cage underground, you will be the happiest person on the planet!
The same if you just emerged from a concentration camp. To get a real comparison, you need to compare quality of life surveys, where Australia does really well, in fact right at the top of the world.

You young ones perhaps don't realise how easy you have it, as I said, life is relative.

Fact is that all the countries that you mention are falling over themselves to find ways to reduce taxation, because the high taxation idea was a dismal failure.

Next point, you are comparing apples with oranges. In many countries
healthcare and old age pensions are included as part of Govt taxation. In Australia, the huge 9% of income super pool is not seen as taxation when you calculate your figures. Yet its a compulsory payment for everyone. Add that, plus state and shire taxes, our share is not so different to other countries.

Given rising petrol costs, no doubt Victorians will frequent more public transport. There is no need for it to be free. It just needs to pay its way. Why should people who don't have access to public transport, subsidise those who do?

Life is simple Tristan. Get off your arse and make it happen, don't worry about Govt doing it for you. The world is full of opportunities if you open your eyes and learn to think outside the square.
Posted by Yabby, Sunday, 7 May 2006 4:25:20 PM
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Yabby, you are certainly crabby today.

What of Tristans youth?

I think you are in danger of becoming a GOF. Geriatric ...

Being young is not a sin, and why shouldn't he have his say. After all he is likely to have to live with any changes for a lot longer than you.

Ps. Aka means grandmother :)
Posted by Aka, Monday, 8 May 2006 12:08:43 AM
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Thanks Tristan, you have restored some of my faith in Australian public decency. If we want to build a compassionate society, taxation to support social infrastructure is needed. The market cannot provide compassion; it is more likely to destroy it. If we want a healthy Australia, decreasing both poverty and income inequality through the tax system is the way to go. Poverty and ill health go together. Inequality adds to the impact of poverty. If we want to reduce the shame so many of us feel at the way we treat Aboriginal people, more tax revenue to support Aboriginal people to support themselves is the way to go (and before anyone argues that we spend a fortune on Aboriginal people please check your facts).

Tristan from all of us - and there are many - who want Australia to be a caring civilised society - thanks mate!

And to those who have used "communist" and "socialist" in their comments could I appeal to you to have a look in the dictionary before using these words again.
Posted by guy, Monday, 8 May 2006 11:35:50 AM
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I can understand the conservative perspective in favour of tax cuts and their argument that low tax creates incentive for achievements. Certainly in a perfect world where everyone is equal and has the same opportunities in life, the conservative position would be quite reasonable. However, we are not all in the same position.

As tristan has pointed out, unfortunately tax is the downside of good infrastructure and developing oneself as a useful contributing citizen is not something that anyone has ever done completely on their own. Social services and social and pysical infrastructure are vital components of any person's development and taxes are needed to pay for the services which help people develop into worthy citizens and to bring their own families up in ways which encourage their children to have self-respect and confidence in their ability to contribute to society and their own welfare.

A belief in social services is not 'socialist' in the sense that people use this term in Australia. It is essentially liberal in that it recognises that people need to work on a level playing field, that inequalities of opportunity need to be addressed and that extreme financial stratification only causes division rather than national unity.
[See rest of post below]
Posted by honeybee, Monday, 8 May 2006 11:44:06 AM
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[Post continued from above]
A sensible tax system would:
- encourage innovation by developing an infrastructure (including a worthy education system) which sponsors a 'knowledge economy,' invests in research and development and provides opportunities for innovative inventors, entrepreneurs, etc, to develop their ideas while staying in Australia. We can't sell primary resources for ever, someday the mines will run out.
- It would see the prevention of extreme poverty as essential to our vision of Australia as the land of the 'fair go'. And invest seriously in people so they feel the confidence to make something of themselves (current punitive 'mutual obligation' welfare strategies only leach people of all self-confidence and make them feel less than human - just visit a centrelink office if you don't believe me - it might be educational). Australian government spending needs to encourage economic development but this should be the type of development that creates real jobs not nasty low-paid casual jobs.

- It would help families spread the cost of raising families across the life cycle by providing excellent childcare, education and other support services to young families and taxing people in other stages of their lives when money is more readily available (i.e. money is not simply redistributed from 'rich to poor' but across people's own life cycle).

Ideas such as those Tristan brought up in his very interesting article would be the topic of serious debate and not simply dismissed as socialist nonsense. While he may not be right in all details, he is right that comparative studies of other taxation systems may be of use to Australia. Certainly I have more faith in social scientific research than overly simplistic ideological arguments about taxation.

Let's look at where money actually is spent and have an open debate about the merits of this spending and the goals that Australians really think are worth spending taxpayers dollars on. This means finding good ways of spending money not just taxing people more. We need government spending where is really matters, in ways that makes life worth living in Australia.
Posted by honeybee, Monday, 8 May 2006 11:44:43 AM
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Tax and Tax,the rich and the not so rich,the worker,the battler,we may argue about this,read about it,nothing will ever change,we are supposed to live in a democratic country,where all is fair,an even distribution of the fruits of our labour,but this is not to be,as under a "Coalition of the RICH "?,it prime purpose is to keep the better part,of our wealth in the hands of,the 5%,that decides how the rest of Australians live,and John Howard AND Peter Costello is making a DAMMED GOOD JOB,TO ENSURE IT STAYS THAT WAY.
Posted by KAROOSON, Monday, 8 May 2006 12:30:33 PM
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Actually,-I-am-not-a-university-student.-The-photo-is-seven-years old,-so-perhaps-that-has-something to do with why some of you are making that assumption. Perhaps it's time I updated the photo. And even if I was a university student - that's no reason to be denigrating.

Also - I consider myself to be a liberal democratic socialist - but that really is the same thing as being a social democrat in my book. The split in social-democracy that goes back to the First World War was improtant at the time, but is now dated, especially given the decline of communism. The matter of principled internationalism is still relevant - but that is something best fought for within broadly based parties rather than advocated from the margins. I am not a communist - I think communism is an unattainable ideal. Basically, I see all progressive responses to the 'social problem' as linking in with the 'socialist tradition'. I am not at all hostial to liberalism - and welcome contributions to the debate that suggest my proposals are compatible with the progressive liberal tradition.

I believe in a mixture of public ownership, co-operative enterprises, and private ownership of business including wage earner funds - essentially a 'mixed economy'. As a utopia, I'd like to see wage earner funds and co-operatives proliferating the private sector - but 'utopias' are hard to achieve - politics is a long, hard grind and I think it would be a miracle if we ever achieved in Australia the kind of situation that has existed in the Nordic countries for decades. The proposals in my article would barely begin to achieve this. Nevertheless, in the long run, this is what I'll fight for.

Also - I agree with some of the writers here and thank them for their contribution. The kind of proposals I'm making here are the same kind of proposals that might be made by social liberals in the United States. Liberalism does not mean 'neo-liberalism'. Some liberals see that state intervention can sometimes empower the individual rather than disempower him/her. And there's nothing to stop a liberal from realising the advantages of socially-provided infrastructure.

Anyway,-I-hope-good-spirited-debate-continues-and-that,-from-here-on,-the-personal-insults-end.
Posted by Tristan Ewins, Monday, 8 May 2006 12:46:01 PM
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Tristan, much of the debate around just societies/income redistribution etc seems to be based on what I consider to be a simplistic view of the work/income/quality of life equation which results in an inequitable system.

I would like to see the debate widened to address other parts of the equation.

I'll toss in some bullet points for items which I think need to be considered in the debate
- Employment income is generally a trade off against personal time and to some extent quality of life. My choice to work full time brings with it a personal cost in terms of time to persue recreational/personal interests which those who make different choices share to a lesser or greater degree depending on their own choices.
- A taxation system based primarily on "taxable income" does not take any account of the tradeoff between personal time and employment income in the way it impacts on individuals. It impacts entirely in the financial realm and ignores the time benefit enjoyed by those who choose a lesser involvement in paid employment.
- Employment lessens opportunities to save in other area's - shopping around for bargan's, growing more of your own produce, doing more of your own repairs/maintenance etc.
- Gross income is not a consistent indicator of the effort put in to earn that income. Should someone working 50 hour weeks at a low base rate pay the same tax as someone earning the same taxable income from investments based on inherited capital?
- Gross income is not a viable indicator of the actual need that a person has for that income. Someone recovering from a divorce and who is effectively starting over will have different needs than someone who is well established (or plenty of other scenarios).

Personally I don't think that any taxation system can effectively deal with most of these issues. What may help the debate is an end to the claim by some that a taxation based primarily on income is just or equitable and get back to the reality that it is primarily expedient.

R0bert
Posted by R0bert, Monday, 8 May 2006 4:27:20 PM
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Robert - what you say about the inadequacies of the tax system is true. There is a trade off between personal time and hours worked for many people. Also, though, there are many people who have no choice as to whether or not they work part time, full time or on a casual basis. The PAYE income tax system cannot discriminate - but, as you suggest, there's little that can be done about this. Having a progressively-scaled income tax system is still one of the best ways of ensuring distributional justice - but yes - it is flawed. Ideally, though, I might add, no-one ought be forced to work overtime - and I would like to see a 35 hour week introduced here as exists in France.
Posted by Tristan Ewins, Monday, 8 May 2006 4:39:18 PM
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KAROOSON, the "fruits of our labour" belong to whichever individuals laboured to obtain them, not to society as a whole. Neither you nor anybody else is entitled to the wealth created by another, just as nobody but you is entitled to your wealth.

Redistribution of wealth is completely unethical as it requires great coercion to pry peacefully aquired property out of the hands of another, and if it must be done then it may only be justified when done to protect every individual's natural right to freedom and property, and certainly not to impose some idealistic subjective fantasy on everyone.
Posted by G T, Monday, 8 May 2006 4:55:28 PM
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You have a small point Honeybee, I should have been more specific with Socialism: There are many strands, and are all based on the same premise of philosophical hypothesis. Basically to steal by fraud some one else’s effort.

The point you advocate and some others is a partnership of Looters of witch doctor Ideologue to confuse the aggressive Attila’s. Government and so called private enterprise, which is unusual, because at a point of time, in a certain place, such a thing was invented in Italy, and was adopted as policy by Germanys Socialist's, perhaps this may contradict what pantheistic Hypothesis you may well be indoctrinated with. It is called FASCISM.

You learn many things on OLO; I would hope some learn from historical mistakes.

Tristan, you argument has too many floors with holes.
In the first instance , there must be industry to produce wealth before it can be looted, Loot does not grow on trees, nor do big pots of gold appear from a forth dimension in our wallets or bags. It is earn and is recognition and a reward for effort. That conflicts heavily with your Ideology.
See here: http://majorityrights.com/index.php/forums/viewthread/22/

Your vision exists in the Middle East oil rich countries, but understand the nature of their societies , and how fractured and lacking they are
Posted by All-, Monday, 8 May 2006 5:09:54 PM
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Tristan, I don't see that there is "distributional justice" in the income based taxation system. I suspect that a belief that there is contributes to the divide in the debate and an unwillingness to work towards better solutions. Those who consider the current system to be providing some kind of justice are unlikely to work towards solutions which lessen the burden on those currently carrying it.

I'd like to see a change in the language of the debate so that it was recognised that what society is doing is taking away from people the results of their labors to help deal with the needs of society. Not justice, rather a pragmatic means to an end.

I've floated the idea previously that taxation could be based on a certain number of hours per person and paid either in hours of "genuine" community service or money (based on average hourly income) depending on which was most available. Clearly the idea would need some thrashing out but could form the basis of a fairer system.

All capable adults would then have an identical obligation to society in regard to the one truly finite resource we have - time. Plenty of justice in that.

R0bert
Posted by R0bert, Monday, 8 May 2006 6:20:36 PM
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Aka thanks for your kind words lol. Perhaps you missed the smiley after the youth comment, but I shall forgive you this time :) There is no doubt however that the idealism of youth, eventually turns to the more skeptical analysis of us older farts :)

The Economist of June 12th 2003, carries an analysis of Nordic countries, the problems they face etc and its not all roses I assure you. I can't give you a link, as its subscriber only, but some might have a copy or be subscribers.

The welfare states in those areas were formed along time ago now.
The global economy, more global people, global money etc, is all taking its toll. The mega rich simply park their money somewhere else, or Govts have to do to special deals with them to stay, so much for equality of taxation for the very rich.

Every third bottle of beer drunk in Sweden for instance, is bought outside of Sweden, so less tax for Sweden. The cash economy is very large, there is a larger incentive for it to become larger. In education and health clinics, private enterprise is increasing
once again. The Finns joke that" The Swedish welfare state is like a Volve without tyres; it is a great car, but it doesen't work"

All these things that Tristan is discussing have been tried before, there is no point in reinventing the wheel. The 35 hour week has been a disaster for France for instance. Perhaps he could subscribe to the Economist for a while, where these things are critically analysed in quite some detail
Posted by Yabby, Monday, 8 May 2006 7:59:56 PM
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Tristan, it is reassuring you too are confident to quote the data of nationmaster.com.

However, we differ in this respect

The correlation I quoted, as to the negative impacts on life satisfaction of progressively higher rates of taxation was based on “ALL” the available data at the time.

Hence
Nation ................ Life
State Taxation% Satisfaction
Australia 23.10 7.30
Belgium 55.60 7.30
Canada 30.20 7.60
Denmark 44.20 8.00
Finland 45.90 7.50
France 48.30 6.60
Germany 50.70 7.10
Hungary 52.60 5.50
Iceland 25.70 7.80
Ireland 25.80 7.80
Italy 46.20 6.90
Japan 24.20 6.20
Luxembourg 33.90 7.60
Netherlands 42.30 7.60
New Zealand 19.60 7.40
Norway 37.00 7.40
Poland 42.90 5.90
Portugal 32.50 6.70
Slovakia 42.00 5.60
Spain 37.90 6.60
Sweden 48.60 7.50
Switzerland 29.50 8.00
Turkey 43.20 5.60
UK 29.70 7.20
USA 30.00 7.40

Correlation of Taxation Rate to Life Satisfaction Index -0.31868

(excuse the presentation, OLO posting system dislikes tabbed data)

Regarding your remark "The happiness survey, described at Nationmaster.com, has the people of Sweden third in the world, behind Iceland and the Netherlands."

So what! The tax data identifies Iceland as having a life satisfaction index of 7.8 (higher than both Sweden and the Netherlands) with a tax regime of 25.7% (lower than Sweden or the Netherlands), which, generally supports the observation that a higher taxing regime produces a lower life satisfaction index, which is what I stated in the first place.

I would suggest Tristan, if you want to use data, use all the data and don’t try to "cherry-pick" the bits which conform with your pet political fantasies.
Posted by Col Rouge, Tuesday, 9 May 2006 11:32:22 AM
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Now “This means less money for health, infastructure, aged care and education.”

And “BTW - low tax regimes have led to one of the worst health systems in the developed world in America - and we are slowly but surely heading down the same path.”

All “deployments” for resources are faced with competitive demands from other deployments. The money for the services you suggest is merely deflected from private deployment choices to public deployment choices.

One reason I find the issue important is I was brought up in UK in the middle of the supposed “socialist nirvana” of the 1950/60s. The problem with public deployment is simple, the client has no direct say or influence. The public hospital patient cannot choose to go elsewhere. He or she cannot influence the quality performance of the service provider because of the layers of burgeoning bureaucracy between him and that provider.
Alternatively, the private patient can take up his bed and walk to another provider and get the service he or she expects. Same goes for schools and aged care. “Infrastructure” is an omnibus word which describes nothing. If you are referring to say public roads, they are financed by fuel taxes. If you are referring to government owned commercial enterprises, they should be generating sufficient funds to finance themselves, like the rest of commerce.

So the real question is “does the individual know better for themselves than the government”?

I for one, believe we do. Invariably, government considerations of “value” are diluted to issues of public popularity, political ideology and and other “third party” assessments and judgements to what is “good and (supposedly) virtuous”.

The individual, paying for a service can use their personal preferences to decide, for themselves what they want, what they are prepared to pay for and when they believe they have paid enough.

Simply put, because it is a “public / government service” does not guarantee it will be a good service (hospitals, schools or public transport), from personal experience, quite the opposite applies.

Robert, succinct as always. Great post.
Posted by Col Rouge, Tuesday, 9 May 2006 11:45:43 AM
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Tristan,

A couple of points, one specific and one general.

1. You say that flat taxes are regressive. This is wrong; a leftie myth. Flat taxes are still progressive, just not as progressive as the tiered taxes we have currently.

2. If the government overly socialises the economy it becomes deadened. This is why communism didn't work: because it took away incentive from people to do things. Once this happens on a national level, you may as well kiss away the idea of comparative advantage with other national economies. That's the big driver for improvement in people's lifestyles/health/etc. So overly taxing the country is shooting onesself in the foot, particularly when other countries are becoming more competitive.

I agree with the idea of a Tobin (transactions) Tax though, but only if applied internationally. At least then the super-rich may pay more tax than they have in the past. If a version of a transactions tax is applied domestically, there'd be a lightning relocation of assets and investments overseas and Australia would lose out that way.
Posted by RobP, Tuesday, 9 May 2006 3:17:18 PM
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Many-people-can't-afford-private-hospitals.-What-'choice'-do-they have-when-the-public-system-is-underfunded?-Most-elderly-people- have-little-'choice'-by-the-time-they-end-up-in-nursing-homes.-The decisions-are-often-made-by-family members - not-all-of-whom-care about-the-welfare-of-the-relatives-concerned.Those-on-massive-waiting-lists-for-public-dental-care-also-have-little-'choice'. Dental-care-is expensive-those unable to afford care often simply go without.

You may want to criticise Sweden - but Finland and Denmark also enjoy very large welfare states - and they are the first and third most competitive economies in the world. Finland certainly hasn't lost 'comparative advantage' as a consequence of public provision of infrastructure and services.

Sweden, Finland, Denmark - are far more egalitarian societies than Australia. We kid ourselves that we are egalitarian in this country, but the reality is that that vast majority of wealth is in the hands of a minority while significant numbers continue to struggle in poverty without sufficient welfare support, or support in moving from welfare to work. And while you may think Australia's low tax status make us superior to Sweden with its comprehensive welfare state: in Australia the elderly often have to sell their house to receive a position in a nursing home where care is often substandard anyway. In Sweden aged care is free and of the highest quality.

Col Rouge criticises public health and education - but does not draw the natural conclusion that this might stem from underfunding rather than some intrinsic flaw with public provision of services. School infrastructure in Victoria has been underfunded for years, and only now are some upgrades being made at the expense of the privatisation of the Victorian govt's stake in Snowy Mountains hydro scheme.

Finally, if you lived in Victoria, you'd be aware by now that roads are being financed by 'Public Private Partnerships' that result in massive and regressive user-pays charges, and ultimately cost significantly more than the simple public provision of the same infrastructure.

If we don't pay for essential services publicly-we-end-up-paying-for them-privately. This kind of 'user pays' scenario IS definately regressive - with the same price being paid by rich and poor alike. Ultimately, residual public systems of care are marginalised as the middle class opts for the private choice in health and education and those unable to afford this are provided with substandard services
Posted by Tristan Ewins, Tuesday, 9 May 2006 5:05:47 PM
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Col, thanks for your comments.

I'd really like some engagement from "the Left" (not the best term but it seems the easiest to understand in this debate) on alternative ways of thinking about concepts like social justice, obligation to society etc that appear to underpin much of their thinking regarding funding for public services/ welfare/infrastructure etc.

For the reasons I outlined earlier I find the use of terms like "justice" in relation to a primarily income based obligation system quite offensive. I don't feel that any justice is done when individual choice, circumstance, need etc are ignored in the equation.

I have put forward an alternate framework that I feel could form the basis for a discussion on the topic. Not a framework which addresses all the issues but one that at least provides a form of equity. There may be others frameworks out there which would do the job better, if so they should be looked at.

I'm tired of those who are unwilling to look at better ways of getting funding for societies needs and who think that the solution lies in slugging middle income earners even harder to pay for those underfunded services and infrastructure projects they care so deeply about. Real people are getting hurt by a callous disregard for the middle income earners and their needs and aspirations.

R0bert
Posted by R0bert, Tuesday, 9 May 2006 6:08:10 PM
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Lots of points here, I will address a few of them.

The World Comptetitivness Report is a great way to compare
things like corruption, political stability, innovation etc.
At the end of the day however, its not where large companies
invest their money. China is well down on the list, yet
many companies from the Nordic zone are falling over themselves
to manufacture their products there.

A large part of Finland's economy is based on one company,
Nokia. At one point its shares made up two thirds of the
Helsinki Index. Does that sound healthy to you? With Sweden
Ericson plays a large role. There is no doubt, the Nordics
are innovative people. When its so cold, they can't go to
the beach like we can :)

If we look at wealth in Australia, there are very few seriously
rich people. They choose to pay tax here. If we increase rates,
they can move their wealth anywhere, just like rich Swedes do.

If we look at who owns most Australian companies, the results are not the megarich, as many assume, but in fact all of us. The
superannuation pool in Australia is now worth 1 Trillion $, which is
as much as the value of the ASX. The 9% levy is in fact a huge tranfer of wealth to everyone. The young benefit, they will be paid this all their lives, something that we never had.

Other large shareholders are the grey nomads. People who worked 40 years, saving their pennies, who are now enjoying retirement, often at no expense to the taxpayer. Of course they will have more assets then a teenager fresh out of school! They have 40 years of hard work and saving behind them after all.

Can anyone give me a good reason, that if grandma's Manly house is now suddenly worth 1.5 million $, why grandma should not use the value of that house to pay for part of her old age care? Clearly
grandma is seriously rich!
Posted by Yabby, Tuesday, 9 May 2006 10:56:44 PM
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My grandmother's house was the only asset she had - and it wasn't worth very much as it had been worn down over the years she had survived on a pension. She had very little in the way of cash savings, and survived on a war widow's pension. God only knows how she would have survived on a normal pension. She had to sell her house to get into a nursing home - and then she only ate when my mother went to the nursing home to help. Most elderly people don't have children who care as much as my mother cared. I bet you'd complain about an inheritance tax for millionaires - but if a poor old woman has to sell the only asset she has in order to receive sub-standard care in a nursing home, that's fine. Costello's just gone and blown the surplus on tax cuts - mainly for the rich. What are we going to do with an ageing population when the asset boom ends, and when already most nursing homes are understaffed and provide insufficient care? Six billion dollars in tax cuts in the first year going to over $30 billion over 4 years. That's enough to put an end to waiting lists in public hospitals. But no, it had to go in tax cuts instead. And not a cent of it went to the poor - no tax credits for low income earners and those trying to move from welfare to work. And then there's the Labor Party saying 'me too, me too!'.

It is true that there's a lot of money in superannuation funds - but that's a subsitute for the pension - effectively it's a privatised pension. And, as such, it discriminates against the poor. The vast majority of shares, on the other hand, are still owned by a tiny minority
Posted by Tristan Ewins, Tuesday, 9 May 2006 11:19:10 PM
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Tristan, I’m sorry to hear about the bad treatment that your grandma received. Hopefully you reported the nursing home, so that they either lost their license or improved their conditions.

The average house is Sydney is now worth .5 million$. Why should the elderly not use those assets to provide better conditions for themselves in their last years?

I do actually agree with inheritance tax, as I agree with tax
of family homes. Tax needs to be broadly based, but at low levels to make it fair.

Most of the present tax cuts actually went into moving the 15%and 30% levels upwards, so 80% of Australians benefit..

Tell me if I am wrong, but it seems that you think we should provide Rolls Royce health care for everyone, including those who believe that providing for themselves is optional, even if they could.

I think that’s highly unfair. Those miners down those gold mines for instance, they work hard, under difficult conditions. They do it not for fun, but to help themselves and their families. I think its unjust to want to take more of their paycheck, to provide Rolls Royce services for those who refuse to get out of bed in the morning and provide for themselves.

Young Australians are very fortunate. This country is full of opportunities, if they go out and seek them. I don’t know about Victoria, but certainly in other parts of Australia. So to me its all about attitude. Some think that the country owes them everything for doing very little, others go out and make things happen in their lives and for their families. If Costello has given some money back to those who go out and makes things happen, money which was theirs in the first place, then I am not going to knock him for it, especially not if its people like hard working miners.
Posted by Yabby, Wednesday, 10 May 2006 11:01:35 AM
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I agree with Robert's point about the undervaluing of individual effort. There are plenty of middle-income people - both aspirational and those only just surviving - who are getting slugged via income tax. As income tax raises over $100 billion per year, it's easily the dominant revenue-raising engine for the government.

To solve the problem that Robert talks about, the GST rate could be doubled so that it raises about $80 billion, thus making it comparable in size with income tax. In conjunction with this, the government could calibrate its dole/pension payments so that equity is maintained for the poor. It could also raise the tax-free threshold to help the working poor. Then with the money left over it should significantly reduce the income tax scales.

The overall effect would be to smooth out a lot of iniquities between major groups of taxpayers. This is because, as just about everyone is a consumer (and pays the GST) while only a bit over half the population pays income tax, an increase in the overall proportion of tax raised by the GST will share the tax burden more fairly.

If the idea works as it should, the super-rich, who have anecdotally reduced their average tax to 25% or less via tax minimisation, will pay more, the middle-income earners will pay less, and low-income earners will stay where they are. It doesn't solve all the problems out there, but it would be heading in the right direction.
Posted by RobP, Wednesday, 10 May 2006 11:26:47 AM
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re: increasing the GST - what about low income earners? There's a whole class of underemployed and working poor out there. How do you compensate them for increasing the GST - and if you substitute the GST for income tax - how do you cut income tax equitably? At the moment Costello's tax cuts are aimed squarely at the core Liberal constituency - the rich. A $10 tax cut if you're on $40,000/year - meanwhile: "people on $250,000 will receive $253.85 a week more, or $13,200 a year." http://www.theage.com.au/news/budget2006/10-cut-for-most-workers/2006/05/09/1146940548320.html
Posted by Tristan Ewins, Wednesday, 10 May 2006 8:26:39 PM
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Tristan,

I’m with you on this – we should all get that $13,200 tax cut. It doesn’t make any sense for those on $500k to only pay 205k in tax, does it? I reckon $400k should just about make it fair.
Posted by Seeker, Wednesday, 10 May 2006 11:08:50 PM
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Tristan, if all costs were progressive, there would be no reason to endeavour to earn more wealth, would there? Hell, why even work if everything will still cost the same amount?

Also, please justify the ethics of your ideology. You seem to think that wealth is collectively owned and that it is unfair that some have more than others. Do you not believe that wealth created by an individual belongs exclusively to that individual? Do you believe a person is entitled to the redistributed wealth of others just for being born?
Posted by G T, Thursday, 11 May 2006 2:38:24 AM
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Tristan “Col Rouge criticises public health and education - but does not draw the natural conclusion that this might stem from underfunding rather than some intrinsic flaw with public provision of services.”

I said “because it is a “public / government service” does not guarantee it will be a good service” and it does not.

If I employ a plumber, a lawyer, a roofer or a vet, I decide which plumber, lawyer, roofer or vet. I decide which level of service / price I will pay.

Why is acquiring the services of a plumber, lawyer, roofer or Vet any different to the services of a school teacher or doctor?

Why should I be forced, through taxation, to pay for the mediocre service which is the result of incompetent bureaucratic bungling and absence of accountability.

The health and school services, unlike Tristan would claim have not been “underfunded” but have progressively squandered their resources by incompetence because, as we all know, you cannot sack an incompetent civil servant but you can sack a private school, a private doctor just as you can choose a different plumber, lawyer, roofer or Vet.
And if we get into institutionalised aged care on a broad public scale, we will see the same mediocre bureaucrats being eased out of the education and health departments to run it.

So pretending that tax funded government services are “Free” is the most expensive mistake anyone can ever make. Tristan, you can trawl up all the faux compassion and mealy mouthed excuses but REALITY is If you want it something done well, to your own satisfaction, you will make sure you choose for yourself and pay direct, rather than leave it to unelected bureaucrats to make the quality choices for you.

Seeker, your sarcasm is showing LOL

GT your point about the disincentive aspects of progressively high taxation is absolutely correct. The able and capable should not be taxed for exercising the skills (from which the entire community ultimately benefit through direct individual service use).
Posted by Col Rouge, Thursday, 11 May 2006 10:50:49 AM
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Tristan,

As I mentioned, you could compensate the losers from raising the GST rate by using some of the proceeds (say half) to maintain equity for them. The traditional mechanisms of raising the dole and pension along with raising the tax-free threshold would probably do the trick. If there are still holes that poor people fall through, the government could set up a GST Discount Card, say, to target help to them. It could just add this function onto the services smartcard it's developing.

You're missing my point that raising the GST automatically ensures the rich pay a greater proportion of tax, all other things staying equal. It actually counters to some degree the effect of Costello's just-announced income-tax breaks for the rich. Have a think about it.
Posted by RobP, Thursday, 11 May 2006 11:50:40 AM
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Rob - A-higher-GST-can-be-justified-if-welfare-and-PAYE-income- taxation-are-restructured-to-redistribute-wealth.The problem, however, as we've seen with the recent budget, is that the income tax system is then warped in the interests of the wealthy while the lower thresholds remain un-indexed. Personally, if I were to introduce a 30% GST - which I wouldn't do btw - I would compensate people on AWE and below with tax credits. I'd also account for the ability of the wealthy to invest a greater portion of their income, and to avoid tax, by raising a number of other taxes, including capital gains tax and removing dividend imputation.

You'd need to change the whole formula for welfare also to keep the aged pension and other pensions: a) above the poverty line, b) at a certain proportion of AWE, c) continuously accounting for the impact of inflation, d) accoutnting for the impact of the GST.

It's do-able - but I can't shake the feeling that proper restructuring of the rest of the tax system for purposes of social justice would not follow.

re: justifying wealth redistribution and social expenditure. We receive wages based on market rates for wages. 'Letting the market decide' on its own, however, is not inherently just - as the market does not account for how hard or how well a person works.-There-is-also-the-matter-of-wealth-resulting-from-speculation-or- inheritance.-Also-basic-services-such-as-education,health-and-aged care-should-be-available-to-all-on-the-basis-of-need as a basic human right,and-for-the-sake-of-equality-of-opportunity. The tax system takes into account the injustices of market determination of wages, and recognises the need for capital to make a contribution to the maintenence of the infrastructure that it uses. Finally, there is a need for services such as aged care, education and health - and this need should be accounted for on the basis of ability to pay.

re:-the-public sector-'squandering'-money - I've-already-explained-in-the-article-the-grotesque-cost-associated-with-private-financing of-infrastructure-via-PPPs.-Also - by-and-large,-care-in-a-private-hosptial-is-more-expensive-than-care-in-a-public-hospital.-And-apart-from-inferior-student:teacher-ratios-and poorer quality infrastructure - all the consequence of underfunding - I see no reason to conclude that public education is 'essentially' inferior to private education. The Conservatives have an ideological predisposition against the public sector that ignores the facts - and tries to blame crises of underfunding on some 'inherent' flaw with public provision of services.
Posted by Tristan Ewins, Thursday, 11 May 2006 3:50:20 PM
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Tristan, as I have previously pointed out the current tax systems does not fit with "and this need should be accounted for on the basis of ability to pay.". Gross income is not a reliable indicator of the the ability to pay. You appear to be stuck in a mindset that ignores the injustices of this type of tax system. If pressed you admit to problems and then go on to ignore those problems.

As I've said before our tax system is not about justice, it is a means to an end. The continual assertion that there is any justice in it appears to blind you to the very real harm that it does to many middle income earners.

Likewise you seem to completely ignore the responsibilities of those who deliberately choose lower income in exchange for other lifestyle advantages. How do you intend to have them pay there share of those necessary public costs or are those responsibilities only for those who would like to have the use of money they have earned?

Please move on from the retoric and start engaging in debate that deals with the real world, not the compartments you seem to want to put people in based on income. Your approach hardens attitudes which can only hert the genuinely needy.

R0bert
Posted by R0bert, Thursday, 11 May 2006 4:02:30 PM
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I think tht people are kidding themselves, if they think that by raising the GST to say 20%, they would obtain all this money from the rich, to give to the rest.

Last I saw about 2% of taxpayers earn 150k+ before tax. About 140
thousand people in Aus are worth 1.3million Aus$ plus a house. Thats 0.7% of the population. How much do you think you will give to each of the 80% you want to redistribute to, how much do you plan to screw out of those 0.7% ?

The best option for Australia is to make the cake larger and to empower those people who think that the world owes them a living,
with the knowledge that their best hope lies with themselves, if they grab opportunities they either don't know about or haven't thought about or have so far been to lazy to bother about.

Throwing money at things via Govt expenditure, is not answer to everything either. There is huge waste now in Govt services. Far too much paperwork in the health system, not enough money spent on the coalface. State Govts can change that tomorrow if they wish.

Roughly half the Australian population own shares directly Tristan,
you are kidding yourself if you think its only the rich
Posted by Yabby, Thursday, 11 May 2006 8:05:31 PM
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"Last-I-saw-about-2%-of-taxpayers-earn-150k+ before-tax. About-140
thousand-people-in-Aus-are-worth-1.3million-Aus$-plus-a-house.-Thats 0.7%-of-the-population."

Obviously you need a broader base than that - and tax reform would have to move beyond income tax. Also those on above full time AWE (roughly $55,000/year) would have to pay a larger proportion of tax - not just those on $150,000/year and over. This is what, at the moment, the ALP isn't willing to face. Beazley is too busy trying appear to promise everything to everyone - without saying where the money for education and training - let alone health and aged care - is coming from. In particular the ALP needs to consider means testing Family Tax Benefits for families with higher than average combined incomes.

"Throwing-money-at-things-via-Govt-expenditure,-is-not-answer-to-everything-either.-There-is-huge-waste-now-in-Govt-services.-Far- too-much-paperwork-in-the-health system, not enough money spent on the coalface. State Govts can change that tomorrow if they wish."

If you're willing to provide a more detailed proposition I might consider what you've said more seriously - but it's interesting that neither Coalition governments nor State Labor governments have been able to solve the waiting lists crisis despite it being the number one priority in Victoria. Cutting hospital waiting lists will cost over $5 billion. That money's not going to come simply from 'cutting red tape'. 'Throwing money at the problem' is the only way to solve the problem. You can't train more doctors and nurses, provide vital infrastructure or provide more beds without money.

"Roughly half the Australian population own shares directly Tristan,
you are kidding yourself if you think its only the rich"

And the top 10% own about 90% of them while the top 1% own about 50% of them. Dividend imputation grossly favours the rich.

Robert - I would consider tax breaks for those on low hourly rates who work overtime to make ends meet if it could be proven to be workable. But ideally we should have a more highly regulated labour market, with good penalty rates and a high minimum wage. Combined with a comprehensive welfare state this would eliminate the need for those on low incomes to work overtime - and provide more scope for quality time with family.
Posted by Tristan Ewins, Thursday, 11 May 2006 9:11:53 PM
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Tristan, “I-see-no-reason-to-conclude-that-public-education-is-'essentially'-inferior-to-private-education.”

I said it is unaccountable. However, extrapolating from any situation which lacks “accountability” the notion of inferiority is a certainty and since where the service supplier is not accountable to the service user there is no accountability.

Having experienced the public health service of UK, Australia and USA, the service delivery supplied by the UK was significantly inferior to the user pays private services available in Australia or USA. The UK care level were non-existent the “budget” spent on assuring a cushy environment for “jackboot union” ward orderlies.

As for the rest of your “ideas” -
re “The-tax-system-takes-into-account-the-injustices-of-market-determination-of-wages,-and-recognises-the-need-for-capital-to-make-a-contribution-to-the-maintenance-of-the-infrastructure-that-it-uses.”

Yeah whatever, I work in three distinct roles and earn more than just six figures. Most people who don’t earn as much as me don’t work as hard or as effectively as me. They have never taken the risks or gone out on to the edge as I have done and therefore do not deserve the rewards I achieve.

If you think your ideas are so “good”, test them and present them to the voting electorate.

Alternatively – ask those who experienced all the “egalitarian delights” of the old soviet socialist states why they kept climbing over or digging under the iron curtain.

Ask the South Americans why they keep finding new ways of getting into USA if the “capitalist” model is so bad or why there are no "boat people" arriving on the beaches of Cuba or North Korea.

Suggestions of raising GST? To 20% - why? The government has more money than it knows what to do with, hence the successive budget surpluses brought to us by this responsible Federal government (versus the profligate and financially incompetent pigs who went before), We no longer have any public debt (versus Keating’s “banana republic” management).

Get up and see how many gullibles will follow your political manifesto into the abyss of socialist ineffectiveness. I can guarantee you, your political career will be “still born”.

I have seen it all before and it does not work, ultimately self-responsibility and accountability is the only thing which does
Posted by Col Rouge, Thursday, 11 May 2006 9:18:00 PM
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Col, allow me to link two of your passions on OLO and suggest that if Tristan’s mother had properly exercised her pro-choice decision, we would not be having this anti-market debate with him right now.

Not that you seem insecure, but the sarcasm is all towards Tristan.
Posted by Seeker, Thursday, 11 May 2006 9:58:46 PM
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Well said Col.I don't care how many multi-millionaires Australia produces,I will find a way of selling them something.

Tristan is peddling the politics of envy and Labor in the past have been the masters of appealing to our weaker side only to let it's faithful down time and time again with by wasting tax payers money on hair brained socialists utopia.

Since the Howard Govt have got our country into fairly good shape again,the socialists are again smacking their chops in anticipation of spending billions on their schemes.

I think there are better ways to help the working poor like raising the tax free thresh hold to $35,000 and reducing the tax on investments they hold.

Get the 1.5 million on full time social security back into the work force,make the public service more accountable and efficient.You will then find that we'll have to import more foreign workers from OS to do the menial jobs we find repulsive.

Once a country loses the work ethic and laze around drinking vodka it takes years to change that culture.The capitalist system is far from perfect so let's hear some suggestions on how to improve the system that works best.
Posted by Arjay, Friday, 12 May 2006 12:21:11 AM
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Arjay,

Janet Albrechtsen agrees with you on the perils of NSW government in “Our pathetic addiction to big government” (The Australian, 10/5/06)- http://www.theaustralian.news.com.au/story/0,20867,19080299-32522,00.html

It's the kind of government Tristan promotes.
Posted by Seeker, Friday, 12 May 2006 9:11:52 AM
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>'Letting the market decide' on its own, however, is not inherently just - as the market does not
>account for how hard or how well a person works.

That statement implies the existence of an objective measure of "how hard or how well a person works", when in fact there is no such thing. How hard or how well a person works is determined by the subjective value that each individual has of that work. One of the fundamental problems with the socialist mentality is the notion that value is objective.

Even if there were an objective measure of "how hard or how well a person works", there would be nothing unjust about someone receiving less than that if they consent to it.

There is also the problem of coercion, which you failed to address. Not letting "the market" decide who trades what implies the violation of the right to make one's own decisions.

>Also-basic services-such-as-education,health-and-aged care-should-be-available-to-all-on-the
>basis-of-need¨as¨a¨basic¨human right,and-for-the-sake-of-equality-of-opportunity.

But this also raises the question: does an individual not have the right to NOT provide these services? The right to these services implies the neccessity of forcing someone else to provide them.

>The¨Conservatives¨have¨an¨ideological¨predisposition¨against¨the¨public¨sector¨that¨ignores¨the
>facts¨-¨and¨tries¨to¨blame¨crises¨of¨underfunding¨on¨some¨'inherent'¨flaw¨with¨public¨provision
>of¨services.

The first inherent problem with the public sector is that there is no direct competition for consumers. Everything is supplied and obtained through the state, and consumers cannot choose not to participate. The public sector has no incentive or even signal to improve its efficiency. Because of this monopolistic character, a potential competitor cannot easily compete against a government monopoly that people are forced to participate in, as they would be asking consumers to pay twice.

Secondly, there are no price signals for either consumers OR potential competitors. When people are forced to pay for something, without the option of paying more or less, the service will be considered as a "given", and demand will skyrocket. At the same time, a potential competitor won't sense this price signal as potential profit to be made, because there can be very little competing with the government monopoly that people are forced to pay for already.
Posted by G T, Friday, 12 May 2006 3:54:19 PM
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I think you'd find that most of the working-poor-don't have any investments. Besides, have you got any idea how much it would cost to raise the tax-free threshold to $35,000? Where would the money come from to maintain Medicare, the PBS, education, defence? There would be no money, either, to continue subsidising-private-education either. Your-proposal-would-blow-a-hole-in-the-budget-so-big-that all-services-including-health,-aged-care-and-education-would simply-collapse.-This-is-without-asking-where-the-money-would-come from-for-Howard's-'military-adventures-abroad'.

Col Rogue, meanwhile, doesn't seem to understand the difference between a social democratic welfare state and Stalinism. Ikea, Volvo and Ericsson do very well indeed in socialist societies, as do the wage earner funds that comprise about 10% of the Swedish stock exchange. My democratic socialism is not a negation of capitalism - rather it is a democratisation of it. I don't want to replace all markets: merely to democratise them through wage earner funds, co-operatives and mutual societies. Meanwhile, the United States has a higher level of Company Tax than Australia. I suppose by this reckoning the US is 'socialist'. Also re: public debt - some public debt is necessary to pay for infrastructure - which in of itself adds to competitiveness and is worth the cost of debt-servicing. Meanwhile we have a massive current account deficit and - as opposed to public debt - Howard says it 'doesn't matter' so long as we can service it. Whether or not we can service us questionable - as total external debt is at about 60% of GDP.

"But this also raises the question: does an individual not have the right to NOT provide these services? The right to these services implies the neccessity of forcing someone else to provide them."

Fine - in your world we can go down the US road where medical costs are by far the largest cause of bankruptcy and where people die for lack of money to pay for spiralling medical costs. A decent society does not let people sleep in the streets - nor does it let people die on hospital waiting lists or miss out on life-saving medical care simply because they cannot afford it. Conservatives, however, wouldn't know anything about compassion or decency.

As-for-'Seeker'-wishing-I-was-dead-the-capacity-of-individuals-for hatred,cruelty-and-evil-no-longer-surprises-me-I've-seen-too-much-of-it.
Posted by Tristan Ewins, Friday, 12 May 2006 5:14:04 PM
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Tristan, "Conservatives, however, wouldn't know anything about compassion or decency." - Now you are being a bit more honest in your bigotry and stereotyping.

You might find that if you could get past your blinkers that a lot of conservatives do care a lot about compassion and decency, we just seek different ways to implement them. Many of us place a large priority on "the state" not being the one to cause harm to individuals, a concept that you don't appear to place any value in.

You are happy to sit by while wage earners are taxed relentlessly and spend time dreaming up ways to hit them a bit harder. When asked about the responsibilities of those who choose not to work or choose to minimise their work and ways that they can contribute the silence is deafening.

It's not that conservatives know nothing of compassion and decency, rather that many understand enough that they cannot stomach your narrow version of those concepts.

For the record I know some "left leaning" people who care deeply about those concepts. Compassion and decency are not "left" or "right" issues they are a mark of the character of the person.

Get over your hatred of those who put in effort and start working for justice and a genuine chance for the genuinely needy and you might start to make a meaningfull difference. In the mean time you remain one of those who draw attention away from the genuinely needy by lumping people into your neat little pigeon holes.

R0bert
Posted by R0bert, Friday, 12 May 2006 5:44:36 PM
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Tristan, if you did your homework, you’d find out that Ikea, Tetra Pak and other large Swedish companies have moved their headquarters elsewhere, where they pay less tax. Nokia, Ericson and others are moving many of their manufacturing bases to either cheaper new EU countries or to China. Swedes have moved 65 billion US$ out of Sweden, where they escape tax.

In fact the Nordic model is in deep doo doo, as it relies on lots of taxpayers, yet demographics make it unsustainable. Governments carry mountains of debt, no funds to pay those pensions, the only option will be for the oldies to keep working.
Private pensions are now being suggested as another option.

Compare that with Australia, where we have virtually no unemployment, no federal Govt debt, a trillion $ put aside for
pensions and growing by the day and you’ll understand why we are so much better off then them and will continue to be so in future years.

One thing about Keating, he understood economics and he understood that the politics of envy does not solve problems, it just creates new ones.

All the things you suggest have been tried before and failed, being young you are perhaps just not aware of the many failures.
If you try to screw people with high taxes and regulate everything, people aren’t stupid, they respond. The very rich and very smart
make their money elsewhere. Even now we have 1 million Aussie expats around the world. In HK, Singapore and elsewhere, they pay little tax. Have you noticed how they don’t rush to Sweden?

If people have no economic incentive to get out of bed, innovate, start and build companies, they won’t do it. Next you’ll be screaming for job creation schemes like Labor used to, that was a dismal failure too.

The federal Govt spends 91 billion $ a year on welfare. If more people paddled their own canoe and that dropped by 10%, you would have another 9 billion $ to spend on healthcare and your problems would be solved
Posted by Yabby, Friday, 12 May 2006 8:15:01 PM
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Tristan,

If you stopped over-hyphenating for a moment, you would realise that pro-choice and anti-market are inconsistent and conflicting ideals. You would also realise that if we collect $120 billion in income taxes and spend $100 billion on welfare, something’s wrong already. As Yabby implies, this doesn’t leave much for financing health or education.

You also have a lot to say about imperfect markets, but at the same time seem oblivious to the fact that these are most likely made less perfect with each government intervention.

You also fail to address many of the questions raised. Here’s some new and overlapping ones for you – should I pay higher marginal rates of tax simply because I live in Sydney? Should I pay more tax because I’m at a certain age, gender, or just happen to have a good year? Should I simply pay more because I can?

If you said yes to any of those, then where is the balancing compulsion for all individuals to contribute to society in the way they themselves, CAN? How is the redistribution of such capacity legislated? Can we for example make women have children for those that can’t? Can we make them have one for the country, or even one for the father that he can keep post-divorce?

Convince me this is a revolution worth fighting for, and I’ll gladly put on my Che t-shirt and beret.
Posted by Seeker, Friday, 12 May 2006 10:22:47 PM
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re: welfare - you could begin by reining in the Family Tax Benefit and means testing it thoroughly if you're worried about welfare going to those who don't need it. One of the largest item of public expenditure is aged care - and that's only going to increase in the future. How are you going to pay for that if you keep reducing tax?

Also - your attacks on welfare are the hallmarks of typical Tory 'downward envy' 'punishing the poor'. We already have work for the dole and provisions for mutual obligation in this country and very strict means and assets based tests for those on the age pension and other pensions. Specify where the money would come from and I'd listen to you. But already Howard's shown his attitude by ripping $50/fortnight from Disability pensions. This is simply punishing the most vulnerable in our society - and it is disgusting.

Also - I'm yet to be coinvinced that the so-called 'brain drain' is solely about income tax rates. There are other consideration such as the lure of cheaper housing, higher wages, returning to an ethnic homeland - or simply the desire to travel and be near international cultural and fianancial centres. Regardless, we import more skilled labour than we lose - and many expats eventually return home.
I tend to think that those with the mobility to travel would do so regardless of income tax rates - simply because they could - as a lifestyle choice.
Posted by Tristan Ewins, Saturday, 13 May 2006 1:18:24 PM
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Well Janet Albrechtsen was spot on.We have more than 3 times the number of public servants per head of population compared to New Zealand.Using the economies of scale advantage we should have fewer PS per head than NZ.

Just recently I had a request from one of our Govt Depts to quote for putting a spring on a gate in one of our Parks.With all the nonsense of meeting a Govt rep,transport time etc,a ten minute job will cost the tax payer more than $420.00 to do.Why don't they use their own workers who can use a cordless drill? Multiply this waste by a millions of inefficient activities and you will realise why NSW is in serious infrastructure debt.No matter how they try to spin the reality,NSW is broke.
Posted by Arjay, Saturday, 13 May 2006 4:19:01 PM
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Tristan, I certainly hope that Govt is tough when dishing out welfare. After all, people are getting something from society that somebody else has bothered to get out of bed and go and earn.
I am constantly amazed how when I’m looking for some casual labour for concrete mixing or whatever, people on disability pensions will put their hand up, as long as payment is cash.
So I certainly wonder as to how disabled some of them really are.

Its not about punishing any poor. Its about ensuring that things are not so easy, that those who think that the world owes them a living, are not prepared to help themselves and simply screw the system.

You might not be aware of it, but baby boomers are busily making sure that their super nest egg will be large enough to provide for their own retirement. Costello has just increased that incentive, so the number of share owning gray nomads, benefiting from their own income streams, including dividend imputation that you think is so evil, will actually benefit you, as they won’t be sucking on the govt teat.

Income tax is not the only reason for a brain drain, but it’s a large factor. Why go and work your butt off at the prime of your life, when the Govt takes a huge share of it? People act out of self interest, that’s just human nature.

Change will come to Australia not from one single budget measure, but from a whole host of small changes. Empower people to help themselves, give them an incentive to help themselves, make it worth their while to save, don’t smother them with so many regulations that they prevent them from helping themselves.

There will always be a small % who claim that the world owes them a living. Sadly people often need pain to learn and the biggest thing they can learn is to become masters of their own destiny and not just sit on their butts and wait for the rest of the world to do things for them.
Posted by Yabby, Saturday, 13 May 2006 5:30:54 PM
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Yabby, very well put.

R0bert
Posted by R0bert, Sunday, 14 May 2006 8:10:01 AM
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Arjay, Of Course Tristan is peddling envy, when dealt with a lack of skills, envy and tearing other people down is what small minds pursue since before “Cromwell’s levellers” to the present day, envy of “those that can and do” by “those who could but don’t” is the stuff at the core of socialism.

G T – the market Just – of course not but “feather bedding” the indolent and incompetent is unjust too.

Tristan “Col-Rogue,-meanwhile,-doesn't-seem-to-understand-the-difference-between-a-social-democratic-welfare-state-and-Stalinism.”

You have no idea to what I understand.

So check your facts. The British labour party manifesto of the 1970’s was rated as more left wing than the Italian communist party. Your dramatisation of my statement merely confirms your lack of depth in appreciating the historic closeness of communism and the European Socialist movement.

I suggest you look up the word “Entryism” and find out what it means in terms of “hard line Stalinism” and “social democratic welfare” then we can have the real discussion about what you “really” are trying to achieve.

You have now missed repeated opportunities to challenge the life satisfaction versus taxation analysis which I presented.
Attacking me with side issues to deflect from your lack of analytical substance?

As for “Compassion” and “Decency”. Such qualities are things which can only ever be observed in individuals and never in “the State”. Pretending you can make everything equal for everyone is not compassionate nor Decent, especially when the resultant “everything” is significantly diminished by the dead hand of state interference and government control.

Robert “Get over your hatred …”
Excellent post Robert

Yabby – to support your post may I add a quote

“We want a society where people are free to make choices, to make mistakes, to be generous and compassionate. This is what we mean by a moral society; not a society where the state is responsible for everything, and no one is responsible for the state.”

Margaret Thatcher - one of the Greatest Political leaders of 20th Century

Well said Yabby
Posted by Col Rouge, Sunday, 14 May 2006 10:58:22 AM
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If-Sweden-is-such-a-'basket-case'-how-come they have a current account surplus of"58.8 billion kronor' ....://www.thelocal.se/article.php?ID=1504&date=20050527
....compared with Australia's foreign debt of about $500b? http://www.theage.com.au/news/kenneth-davidson/the-debt-that-dare-not-speak-its-name/2006/05/09/1146940546241.html

And yes - the British Labour Party did once have a proud democratic socialist tradition which is long gone now. The Italian Communist Party, by the way, had gone down the Eurocommunist road and had effectively embraced the path of reform. Nevertheless, I see nothing wrong with strategic socialisation, and wanting a democratic mixed economy does not make one 'hard line Stalinist'.

In my 'ideal scenario' what was and what was not socialised would depend partly on what was necessary to maintain domestic competition. Hence the private banks would remain un-nationalised - although they would have a public sector competitor - I would re-nationalise the Commonwealth Bank, but mining would be nationalised as an industry that was overwhelmingly export-oriented, and whose dividends could be put to useful social purposes. Similarly, manufacturing would remain un-nationalised, but could become the target of 'co-operative schemes', find additional finance from superannuation funds, and be the beneficiary of targeted assistance where there was the possibility of remaining competitive. Small business would remain private, but once again could become more competitive by embracing co-operativism. Infrastructure such as roads, rail, public transport,postal services,ports, airports, communcations infrastructure - would be publicly owned. Mutualism would be encouraged in insurance, and a public competitor would be re-established. Private hospitals would continue to operate - but public health would be upgraded to the extent necessary to overcome any gap in the quality of service. Private schools would continue to receive state aid, but once again public schooling would be lifted in quality to make it a more appealing alternative. Private media would continue to operate, but the ABC would receive a $200 million increase in funding - while a media diversification fund would attempt to create a more diverse media base.

Finally, investment would be democratised with the creation of a Swedish-style wage earners' fund.

Mind you - this is an ideal scenario - I see no prospect of implementing it - nor would I take this scenario to an election.
Posted by Tristan Ewins, Sunday, 14 May 2006 12:53:45 PM
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>Fine - in your world we can go down the US road where medical costs are by far the largest cause
>of bankruptcy and where people die for lack of money to pay for spiralling medical costs.

The US healthcare system is so costly because it is so regulated.

>A decent society does not let people sleep in the streets - nor does it let people die on hospital
>waiting lists or miss out on life-saving medical care simply because they cannot afford it.

A decent society does not force anyone to submit to charity either. Either we are a decent society or we aren't, no amount of government intervention can alter that.

>...or simply the desire to travel and be near international cultural and fianancial centres.

I find this particularly amusing. What do you think makes a "financial centre"? Surely not minimal regulation and low taxes (sarcasm)!?

Also, do you know what a current account balance actually is, and its significance?
Posted by G T, Sunday, 14 May 2006 2:05:33 PM
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Tristan a suggestion. Before you think about politics, perhaps you should improve your skills in economics. Perhaps Grandma can buy you a year's subscribtion to the Economist for Christmas, so that you obtain a better understanding of economics and save yourself lots of
embarrasment.

The current account has little to do with Govt debt. Australia has a trillion $ GDP and no federal Govt debt. Sweden exports quite a bit, but their Govt owes around 50% of GDP. In our terms that would be
500 billion$ of Govt dept, compared to our nothing.

The debt that we have is largely owed by banks. If Australians had saved more in the past, it would not exist. As there were no tax incentives to save, Australians didn't, so now a good % of our large miners and their profits go overseas, rather then to Australians. Keating understood all this, thats why he made the changes that he did, Costello has continued with them.

As part of a cosy little world, Sweden can trade within the EU, free from real world competition on a number of its products. Australia does not have that option. Mind you, even the EU is now realising that their cosy little world is threatened by the larger world out there, where all that Govt regulation is making many EU countries uncompetitive in the real world, thus the high unemployment rates in
countries such as France, Germany and others.

Your "ideal scenario" was all tried and landed up a big failure.
If you would nationalise anything, foreign capital would soon withdraw investments and you would soon be a banana republic.

Forget trying to reinvent a wheel that falls off Tristan, educate yourself about history, modern economics and what actually works.

The US health system is a failure due to regulation and litigation.
A flawed legal system means that lawyers grow rich in the US, at the expense of the public.
Posted by Yabby, Sunday, 14 May 2006 4:20:43 PM
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I didn't say that the current account did refer to government debt. I know the current account refers to the balance of payments re: imports and exports. I know that Australia has a deficit of about $15 billion and a foreign debt of approx $500 billion - which Howard would just like to pretend 'doesn't exist'. Howard has scrapped the R&D concessions for innovative business introduced by Labor while having pretty much nothing in terms of an active industry policy and the deficit has just got worse and worse. Government debt is a bogey wheeled out by conservatives - the twin deficits theory is a fallacy - and as Australia's CAD shows - government surpluses don't lead into a favourable BOP either. Deficit expenditure by governments can feed into economic growth by providing the infrastructure for growth and stimulating the economy - thus improving the capacity to service that debt. Sweden, meanwhile, has comparable unemployment figures to Australia (expected to fall to 4.5% by the end of 2006) - blowing away the fallacy that a large public sector and high taxation will lead into unemployment by 'crowding out' private sector activity.
Posted by Tristan Ewins, Sunday, 14 May 2006 5:15:50 PM
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Col, thanks but it's not one I'm particularly proud of.

I try to avoid letting this stuff get under my skin. Tristans blatent lack of concern for the victims of his "tax em till they bleed and then some more" approach and total unwillingness to the engage in discussion regarding the responsibilities of those who are not in genuine need but choose low incomes hit a raw spot. CSA are busy trying to increase the assessment yet again which makes for a fairly personalised version of Tristan's approach where I am specifically made to pay more because someone else chooses to work less.

The sad bit is Tristan probably does not understand what is wrong with the type of stereotyping his comments reflect.

R0bert
Posted by R0bert, Sunday, 14 May 2006 7:25:27 PM
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Tristan, to assume that Govt debt does not matter, is kidding yourself. 5% interest on say 500 billion (as per Sweden) would mean 25 billion $ off the bottom line, before a dollar of expenditure is paid.

Australia in fact has more growth then it can handle. Resource projects are being delayed, due to lack of skilled labour. Exports
are being held up , due to a lack of workers, even unskilled people. Fact is that if a job is not within a few minutes of somebody’s house, many Aussies aren’t interested, so we have to import guest workers. Fact is many non working Aussies simply get it too good, courtesy of those who are working.

Sweden has dealt with its unemployment problems, by adopting more market focused policies. Marginal tax rates were reduced,
unemployment payments were reduced, corporate tax rates are lower then in Australia. Incentives to save were introduced, tax on capital is far lower then tax on labour. Foreigners with skills scarce in Sweden, are given a 25% tax exemption for 10 years, to try to attract them.

Your suggestions, like nationalising industries and companies and what is happening in Sweden, are in fact totally different, so stop kidding yourself.

Yes Australia has a problem. Because profits on homes are tax free, Aussies have invested hugely in their homes, leading to a housing bubble, which is unsustainable. Homes in Aus are now more expensive then in many other countries, despite our abundant land. Had tax structures been different many years ago, Australians would own a larger % of BHP, Woodside etc,
so profits from these companies would not be sent overseas, as they are now. Instead we created the housing bubble, which is one reason for the enormous borrowing by our banks from overseas and that does not help our current account one bit.
Posted by Yabby, Sunday, 14 May 2006 11:22:25 PM
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Tristan “In my 'ideal scenario' what was and what was not socialised would depend partly on what was necessary to maintain domestic competition.”
“Mind you - this is an ideal scenario - I see no prospect of implementing it - nor would I take this scenario to an election.”

I love it, Tristan first promotes his ideal but then accepts that it is the stuff of fairytales (as socialism goes its all the stuff of Grimm – by name and nature)

I would stand full square and 100% behind what I promote and have practiced it, as much as I can do, over the past 30 years or so. You, by your own words admit you do not have the strength or courage to follow your ideals and thus define the hypocrisy and mediocrity which is enshrined in socialism.

If you do not have the courage to stand behind your ideals, Tristan you are a fool for suggesting themin the first place. Maybe that is the difference between us, you “talk the talk” but lack the courage to walk it,

As I suggested before, if you believe it, go out and sell it to the voting public, it has all been tried and failed before. There is nothing new of innovative in your ideas or ideals, it is just the same old rhetoric of failure which socialists have been peddling for the past 150 years.

Again you continue to ignore the negative impact of taxation on life satisfaction and the last time I looked, we were here to experience a satisfying life, not to be drones to generate taxes for a bunch of economic halfwits to squander on grandiose non-performing indulgences of socialist ideology like nationalised transport systems, mandatory “welfare” with union officials running hospitals, schools and aged care centres according to the lines of “keep the indolent in clover.”

Robert the CSA, I have experienced similar. Fortunately now it is past and I focus on funding my retirement super (15% tax), I will be damned if I will reduce my life style to exist on government pension standards.
Posted by Col Rouge, Monday, 15 May 2006 2:37:37 PM
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Yes, it's true that what I'm proposing is not a complete copy of 'The Swedish model'. Sweden actually has lower levels of company tax than the United States. So do we. In regards to company tax, though, I believe we have 'room to move'.

I believe in a mixed economy with socialised enterprises playing a significant role. And while it is true that I would not go to an election promoting my 'ideal scenario', I'm sure the same might be said of the Conservatives who took 10 years to implement their preferred labour laws and who have been unable to completely dismantle Medicare despite an ideological opposition to the socialisation of medical costs.

If I could determine Labor policy now, I would, however, go to an election promoting the resocialisation of Telstra and Medibank, and I would stop wasteful Public Private Partnerships in favour of public funding for roads, rail etc. I would also resocialise public transport in Victoria - where privatisation is a proven failure. If in control of policy at a state level, I would also resocialise water. I think these policies could be sold without falling at the point of a Coalition scare campaign regarding public debt.

I consider myself a Fabian, and thus are committed to the politics of gradual change. You can't get everything you want at once. That's life. But for Labor, it is unacceptable that we are continually going 'one step forwards, two steps back'.

re: public pensions - public pensions shouldn't be so low that those dependent upon them need live in poverty. I believe in easing means tests, raising pensions, and providing free aged care and generous social services to the aged. I would prefer to see higher taxes and higher public pensions than the privatisation of pensions we have with the superannuation system. But given the fact that that system is entrenched, the least we can do is direct funds into programs of national investment.

re:the-status-of-part-time-work-I'm-not-sure-what-you-want.Already I've-said-I'd-consider-tax-breaks-for-those-on-lower-wages-who-work overtime-to-'get-ahead'.It-seems,though,that-what-you-would-like would-be-for-part-time-workers to be taxed at a higher rate. Apart from this I'm not sure what else you could want.
Posted by Tristan Ewins, Monday, 15 May 2006 4:38:27 PM
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Tristan, the hypenated writing is hard to read, I'm not sure what that is about.

I put up an alternate framework/approach for viewing our responsibilites early in the discussion which is based on the idea that our obligation to society is based on a proportion of our time. That is the one resource that we all have in the same measure, 24 hours a day 7 days a week, 52 weeks a year. We have different totals but close enough to the same number of hours in each day.

Those on very low incomes would meet their obligations with time (community service), others with money. For wage earners our responsibility is based on a combination of average hourly income for hours worked and a fixed number of hours of social obligation.

Assuming that the obligation for each capable adult for the maintenance of society was worked out to be 8 hours per week each person would contribute either 8 hours of pay or eight hours of labour to society depending on their means. I don't know yet how we should address investment income in terms of working out the rate that it is earned at but I'm sure that there is an equitable answer to that with the right brains applied to the task.

That system still means that Col pays more money than those who earn less per hour than he does (sorry Col) but it also means that society does not demand that he give a larger proportion of his life to the maintenance of society than any other capable adult is required to do.

I'm looking at ways of finding a more just approach to social obligation rather than just ignoring a whole swath of injustices in the current system. What I've floated may not be it but I don't believe that we will ever achieve a just taxation system unless we fundamentally change the way we think about the issue.

R0bert
Posted by R0bert, Monday, 15 May 2006 6:07:28 PM
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Tristan I think that you have a flawed opinion of what most people think. I have yet to meet anyone in Australia, who has suggested that we should copy the US in many things.

Australia is free to come up with its own novel solutions to problems. There are degrees of which way the pendulum swings.
Virtually everyone that I know, does not argue against a basic
healthcare system, or a basic pension system. Most people are compassionate enough to be prepared to help those less fortunate then themselves, but they also have a sense of justice and don't like to get screwed either.

You can dream up all sorts of ways that you think Govts should spend money, but at the end of the day, those who do the paying are not slaves of Govt and in an ever increasing global economy, they will respond if they think that what you are doing is screwing them.
So your tax base will collapse and you'll be chasing your tail from there on, as history shows.

We need a four on the floor basic social welfare system, where people won't starve and have access to health care. If they want lots beyond that, let them work for it, as others do.

There are good reasons why Victoria had to sell off so many Govt assets. The previous Govt had so mismanaged the economy that there was little choice. Kennet had little choice but to try and rescue what was basically a disaster. Reality does not go away, when we close our eyes and wish it would.

So dream on about what you would or would not do, lots do that, but be aware that whatever you dream about, perhaps you havent even dreamed about the consequences. People can be pretty creative and the more you would legislate, the more they would dream up ideas to get around your laws, if they thought they were unfair. Best to try and create win win situations where everyone benefits, everything else has been and will be shown to be a dismal failure.
Posted by Yabby, Monday, 15 May 2006 7:57:11 PM
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Re: Tobin Tax

To put simply, it doesn't work.

A transaction tax may reduce liquidity investment but it will not change the volitility of a currency which is based on much more significant factors (such as economic and political stability) than short-term currency speculators.

See the following:

Harald Hau (2006), The Role of Transaction Costs for Financial Volatility: Evidence from the Paris Bourse, forthcoming in the Journal of European Economic Association (forthcoming June 2006).
Posted by Lev, Tuesday, 16 May 2006 7:07:30 PM
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"Assuming that the obligation for each capable adult for the maintenance of society was worked out to be 8 hours per week each person would contribute either 8 hours of pay or eight hours of labour to society depending on their means. I don't know yet how we should address investment income in terms of working out the rate that it is earned at but I'm sure that there is an equitable answer to that with the right brains applied to the task."

I'm not sure, again, how this would work. Would those on welfare be made to work for welfare 8 hours a week? What if those on low incomes ended up paying more tax? What about people who are only capable of working part-time?

"Virtually everyone that I know, does not argue against a basic
healthcare system, or a basic pension system."

What's a basic healthcare system when Medicare no longer provides full bulk-billing coverage, where dental care is excluded, and where waiting lists see hundreds die and suffer year after year? And what's a 'basic pension system' when we have pensioners dying with their houses burning over their heads - because they were using candles to avoid unaffordable electricity bills?

"Victoria had to sell off so many Govt assets. The previous Govt had so mismanaged the economy"

The income lost from selling of the SECV, SIO and other assets could have serviced that debt - and the overall result would have been better than retiring debt through privatisation and the resulting loss of State assets. The Conservatives, however, have an ideological commitment to privatisation regardless of circumstances - which explains why Telstra will be privatised regardless of whether or not it manages a decent sale price.

Also, Lev - you're right that political factors could still cause the collapse of a currency - but a Tobin Tax would nevertheless curb malicious currency speculation - and this is still a good reason for its introduction.
Posted by Tristan Ewins, Tuesday, 16 May 2006 7:46:16 PM
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Tristan, your claims of "hundreds dying and suffering" sound a touch melodramatic to me. I am sure that Channel 7 and 9 would love to know about that, if it were in fact true. Your State Govt is earning a small fortune from increased GST on fuel, they are free to spend it on healthcare or whatever their priorities are.

If pensioners can't pay electricity bills, its just as likely that they blew the money on the pokies. Some people will never learn to spend less then they earn, no matter what their income. Others learn to budget etc, we are not all the same.

You claim that the Vics could have serviced that debt. I have yet to see evidence of that. Call Kennett what you will, he is not stupid.

Telstra was a giant, lazy, beurocratic monstrosity, before some competition was created. I remind you that they used to charge
9$ an hour for internet access. Compare that to today and you will see what getting lazy govt institutions off their butts can do for consumers.
Posted by Yabby, Tuesday, 16 May 2006 8:52:43 PM
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Tristan, how do you respond to my explaination of the inherent problems with public services? I'll post it again:

The first inherent problem with the public sector is that there is no direct competition for consumers. Everything is supplied and obtained through the state, and consumers cannot choose not to participate. The public sector has no incentive or even signal to improve its efficiency. Because of this monopolistic character, a potential competitor cannot easily compete against a government monopoly that people are forced to participate in, as they would be asking consumers to pay twice.

Secondly, there are no price signals for either consumers OR potential competitors. When people are forced to pay for something, without the option of paying more or less, the service will be considered as a "given", and demand will skyrocket. At the same time, a potential competitor won't sense this price signal as potential profit to be made, because there can be very little competing with the government monopoly that people are forced to pay for already.
Posted by G T, Tuesday, 16 May 2006 11:57:53 PM
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Tristan,

"Would those on welfare be made to work for welfare 8 hours a week?"

Welfare/work for the dole is a different issue, I don't get what the objection is to that concept but that is not what this is about.

They would work their 8 hours (or whatever the figure was) to meet their share of the responsibility of keeping society going - healthcare, education, aged care, police, defence etc. Col and I would also be responsible for contributing our 8 hours. Forced obligation to contribute to society stops there.

Clearly the idea needs some thrashing out - appropriate exemptions for those disabled enough to be unable to contribute, some thought around full time parents with young children etc. This is an idea for a different way of thinking about our obligation to society not a fully thrashed out proposal. Our current system is massively unjust and punishes, I'm looking for an approach that removes at least part of the injustice in that system, the bit where a choice to work extra hours equates to extra tax obligation (often at a higher rate) and a choice to work less hours reduces obligation for the upkeep of society (paying for that healthcare, education etc).

If 8 hours of pay for a low income earner working full time increased their tax burden beyond what they currently pay then we scale back government spending to till we get a viable level of obligation which can be applied to all capable adults.

R0bert
Posted by R0bert, Wednesday, 17 May 2006 8:27:10 AM
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"I think tht people are kidding themselves, if they think that by raising the GST to say 20%, they would obtain all this money from the rich, to give to the rest.

Last I saw about 2% of taxpayers earn 150k+ before tax. About 140
thousand people in Aus are worth 1.3million Aus$ plus a house. Thats 0.7% of the population. How much do you think you will give to each of the 80% you want to redistribute to, how much do you plan to screw out of those 0.7%?" (Yabby, 11 May)

The bit about 0.7% is a total furphy. As the GST is levied on ALL consumers, it is geared to getting a greater volume of tax out of everyone, but particularly those that spend more in the economy, like companies and rich individuals. The idea that only 0.7% of the population should be included in an analysis of the GST is the sort of sensationalism the Daily Telegraph puts in its headlines.

What raising the GST would really do, all other things staying equal, is that it would redistribute the tax burden so that the well off and very rich pay more than they have. And there's a lot more of them out there than the 140,000 that Yabby talks about. Also, don't forget that large entities like companies pay a lot of GST.

Of course low and middle income earners would pay more as well. But the government could calibrate accompanying income tax cuts so that these groups pay a lower overall percentage of tax (compared with what that were paying before an increased GST). The net effect would be to push the tax burden higher up the wealth scale where it really ought to be.

Yabby, get back in the creek!
Posted by RobP, Wednesday, 17 May 2006 12:54:23 PM
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"If pensioners can't pay electricity bills, its just as likely that they blew the money on the pokies. Some people will never learn to spend less then they earn, no matter what their income. Others learn to budget etc, we are not all the same."

You are so out of touch. Have you ever tried to survive on a pension? Do you know how much is left to survive on after rent if you haven't paid your house off - or even if you have? Your attitude smacks of detachment and callousness.

see: "Government benefits for unemployed people,for-single-parents, for aged pensioners who don't have superannuation back-up, are border-line, enough to live week-to-week, fortnight-to-fortnight, as long as there is no crisis, as long as you don't need your teeth fixed. They have to go to a dentist because there is no Medicare for dental care. As long as you don't have to live through winter with no decent heater, and the only heater you have being a $20 bar heater from Woolworths that just chews through electricity and leaves you with a $700-$800 electricity bill." http://www.nowwethepeople.org/fair%20go/Dodds_speech.html

and re: the public sector - there is accountability through the electoral process, accountability to ministers etc - and in the case of government business enterprises through competition with private sector counterparts. Re: public hospitals - it's up to citizens to mobilise to demand lower waiting lists and better quality care - the dysfunction is in the political parties who refuse to listen the these complaints and assume the only thing the public wants from governments is another tax cut. In some cases the public sector is inherently superior re: provision of services. Take the closure of rural branches with the privatisation of the Commonwealth Bank. For quality of service, the profit motive ought not be all-consuming.
IN some instances, also, such as airports and postal services, the competition argument is a furphy - and there was never any rationale for privatisation. Market signals have an important role to play, also, but sometimes, as was the case with the government school I went-to-in-years-11-and-12,-there-is-a-culture-of-care-and excellence-that-is-fostered-regardless-of-the-profit-motive-and- market-mechanisms.
Posted by Tristan Ewins, Wednesday, 17 May 2006 2:01:57 PM
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Rob, I think you missed the point of the argument. If you want to leave the poor and middle classes no worse off, somebody has to pay. The stats of 0.7% come from here, if you work it out:

http://www.abc.net.au/am/content/2005/s1389983.htm

Yes companies pay a lot of gst, but they can also reclaim it as a
Legitimate business expense or pass the cost on to the end consumer. The GST is an end consumer tax in the end.

So there are far less rich people to screw then you thought.
Next the really rich spend a lot of their consumer $ overseas on holiday trips, again you miss out.

Tristan I’m not out of touch at all. I have quite a few friends who
are pensioners and I know the solutions they have reached to
make life comfortable for themselves, even if not luxurious.

Many sell their city homes for the high land values and move to regional areas, which gives them quite some cash and a better quality of life. They do a bit of babysitting for cash, or other odd jobs that they usually enjoy. They run a few chucks, cut a bit of
firewood for heat, grow some fruits and veggies in the garden.

In WA pokies are banned, so they can’t blow their money there.
Tell me if I’m wrong, but every time I’ve been East, what I’ve seen
is plenty of pensioners regularly playing the pokies, so where does that money come from?

If you want to raise more funds, spread your taxbase at a low level, so people don’t have the incentive to avoid it. Bring in a
10% death duty and a 10% tax on profits from selling your own home. Those rich you don’t like, all live in expensive houses and when they sell their place, they can make millions tax free.

If somebody sells a house and pockets a half a million $ profit, why should that be taxfree, yet you want to tax people even higher on their wages and on their daily spending.
Posted by Yabby, Wednesday, 17 May 2006 4:48:04 PM
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>and re: the public sector - there is accountability through the electoral process, accountability to
>ministers etc - and in the case of government business enterprises through competition with private
>sector counterparts. Re: public hospitals - it's up to citizens to mobilise to demand lower waiting
>lists and better quality care - the dysfunction is in the political parties who refuse to listen the these
>complaints and assume the only thing the public wants from governments is another tax cut.

Ah, of course it's not the system, but the people running it. Classic socialist apology. If people can't run it properly, then it's not meant for people, is it?

There IS a problem with the system and that is, as I said, that when a service is a "given" and consumers are forced to pay a fixed amount without the option of paying more or less, demand will skyrocket. If you don't have to pay more to get more, then there is nothing to stop one from demanding more; there is no increased price signal to curb demand. At the same time when you're being forced to pay for something, you're going to want the most out of it. Even if taxes are increased to provide more better services, demand will not be curbed because the service is still a "given", and people will want the most out of it. Because public services are collectively paid for, an individual has no incentive to ease their demand, because they know that that alone will make no difference to their personal fiscal burden. It's called the tragedy of the commons.

Your ideas have been tried many times before. They are unethical and they have proven not to work. How you continue to defend and propagate them is beyond me.
Posted by G T, Thursday, 18 May 2006 5:01:39 PM
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My ideas have never been tested in this country - which has never had anything more than a threadbare welfare state.

It seems you'll only be happy when it takes a $100,000 loan to get a degree, where those who cannot afford quality aged care are treated like animals and 'inconveniences' by the selfish and heartless, and where life and death become a matter for the chequebook as the public health system is degraded further and further.

You're probably one of the more fortunate - and you are probably resentful of having to support those less fortunate than yourself. Why, after all, should the poor have equal access to quality education when you can afford a (heavily subsidised) private education? And who cares if some are on hospital waiting lists for two years so long as you can afford your own (again heavily subsidised) private health insurance? Your politics are the politics of driving a wedge between those on average full time earnings and the poor - with the intent of marginalising the poor, encouraging 'downward envy' and depriving them of any voice.

Meanwhile, the Conservatives seek to criminalise legitimate union activity, including the right to take industrial action, negotiate for leave for trade union training, and for access for trade union organisers. Charitable organisations, also as part of this broader process of reaction, are threatened with losing their tax-free status for being 'political' and speaking upon on matters of poverty and injustice.

While splintering the working class and making collective organisation more and more difficult, the working poor can then be isolated and forced onto poverty wages under individual contracts. And while this exploitation reaches new heights, you expect more and more in the way of tax cuts for the wealthy and for capital.

For some this is not a theoretical debate. For the millions who cannot afford dental care or private health insurance it translates into pain and suffering that you care little for because you are one of the fortunate. It's the politics of selfishness - and it's disgusting.
Posted by Tristan Ewins, Thursday, 18 May 2006 6:09:24 PM
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Tristan, you seem largely ignorant of the fact as to how good the welfare sector has it in Australia. PAYE tapayers contribute around 115 billion to the budget, welfare recipients take 91 billion or 80% of that! You should go down on all 5s to thank those many workers for making things so easy in Aus, compared to elsewhere on the planet, where they would simply let you starve.

I know plenty of welfare recipients who own their own homes, have a car, tv, video, phone, dvd, you name it they have managed to budget for it. Do you have any idea what real poverty is ? lol.

Life is simple, get off your arse and paddle your own canoe. Don't expect everyone else to do it for you, unless of course you are very selfish and very lazy.
Posted by Yabby, Friday, 19 May 2006 10:47:55 PM
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Tristan “My ideas have never been tested in this country - which has never had anything more than a threadbare welfare state.”

That admission on the heels of

Tristan ““Mind you - this is an ideal scenario - I see no prospect of implementing it - nor would I take this scenario to an election.””

Yes, well Tristan, if you want to test anything, I suggest you consider this, me and millions of other Australians have not given our permission for you to experiment with our national economy whilst treating us with the reverence a scientist holds for a lab rat. You being someone, who admits you do not have sufficient faith in your ideas or ideals as to wish to test them at an election, presumably, your omnipotent insight is sufficient for you to simply appoint yourself Reich Chancellor and the rest of us can suffer in submission.

I would suggest rhetoric like “threadbare welfare state” is sour grapes and not as “threadbare” as your commitment to ideals or authority to speak for anyone who is more distant from you than your own nose.

You have published an article which you have admitted you cannot would not stand behind the issues you espouse. That is, in a single word a “degenerate” perspective.

Most of us believe in what we write, I certainly do but you, in comparison, display your “faith” like your politics as having the “substance” of fairy floss.

Yabby, spot on.

Ultimately “co-dependence” (which Tristan is espousing) is a recognised disorder.

We all paddle our own canoe and in so doing society reaches further than if we are held back in the same boat by those who cannot handle a paddle.

Whilst there are some who are worthy of our compassion and support, there are alot more who prefer to have a free ride at the expense of the rest of us.
Posted by Col Rouge, Sunday, 21 May 2006 7:16:39 PM
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"You being someone, who admits you do not have sufficient faith in your ideas or ideals as to wish to test them at an election, presumably, your omnipotent insight is sufficient for you to simply appoint yourself Reich Chancellor and the rest of us can suffer in submission."

I have much faith in my ideas - but I am aware that the existing social forces are not sufficient to mount a successful front on challenge to the neo-liberal paradigm. Neo-liberalism dominates Treasury and the media. There is hysteria about public debt and the prospect of public borrowing. This limits the prospects for resocialisation. Apart from this, we face the fact that the ALP itself is a party dominated by the neo-liberal Right. It will take a long battle to reclaim the ALP, as well as to mobilise sufficient social forces outside the ALP, before social democracy holds any hope of revival.

Part of that process, however, is people having the guts to put their ideas 'out there' in the first place. Admittedly it's a bit like throwing bottles into the ocean - but there are other signs of resistance. Online publications like New Matilda and others offer forums for dissent, while On Line Opinion is welcomed for its pluralism. There are also a swathe of progressive journals that provide a forum for dissent.

But until social democracy again breaks into the mainstream, these alone are not sufficient. The task at hand is that of mobilising within the ALP and the labour movement, while also drawing community and welfare groups into the struggle. (what Antonio Gramsci would have called building a 'counter-hegemonic historic bloc) I think, here, that the Now We the People movement has a lot of potential - and ought be a lot more active and highly profiled than it is.

As for your suggestion that I am a Nazi - well, I find your attitude repulsive. I am a democratic socialist and an internationalist. I believe in international socialism, not fascism. If we had a sufficiently internationalist social-democratic movements, the diffuculties-posed-by-so-called-'globalisation'-and-the-increasing dominance-of-the-finance-capital-sector,-could-be-tackled-through international-capital-and-solidarity.
Posted by Tristan Ewins, Sunday, 21 May 2006 9:58:57 PM
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"Whilst there are some who are worthy of our compassion and support, there are alot more who prefer to have a free ride at the expense of the rest of us."

And who are these people? With 'work for the dole' and 'mutual obligation' there is little prospect of so-called 'dole bludging' - which really was never more than a reactionary myth in the first place. Australia is one of the most highly stratified countries in the world. But wealth should not be the determinant of access to life-saving health care. Nor should equal opportunity through education be denied through the imposition of exorbitant fees, or the neglect of public schooling. As I said earlier in this thread, the market does not magically create socially just outcomes. It is based on demand and supply - and has little to do with justice - and nothing to do with compassion. I doubt you'd know what compassion is.
Posted by Tristan Ewins, Sunday, 21 May 2006 10:02:51 PM
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Tristan,

Not surprisingly, you don't address the point but resort to personal attacks and meaningless generalisations. In fact you didn't even make a single rebuttal to the points made.

Free market advocates don't desire a selfish society. An absence of forceful charity does not mean an absence of charity. I'm not trying to convince you that some people should suffer - quite the opposite; in fact I'm trying to explain to you why everyone would be better off in a free market, and why socialism doesn't work.

Despite playing the only card you supposedly have - compassion - you still haven't explained how it is more ethical to force one person to give up their earned wealth to others than to not. Is one person's problem everyone's problem? Is a person entitled to the favours of society just for being born?

When you take wealth from "the rich" to redistribute it, you're taking them for granted, and when you take something for granted and continue to abuse it, it becomes no more.

Know that there wouldn't BE a "rich" to take from for long if you had your way.

That free market advocates enjoy seeing people suffer is a complete and utter lie that you should be ashamed to propagate.

This isn't a matter of whether or not we want to acheive a just society where everyone is well off, it is a matter of how. I'm just explaining to you why socialism cannot possibly acheive that.

Your¨bleating¨about¨"compassion" is¨an¨irrelevant¨glittering¨generality¨-¨a¨utopic fantasy¨contradictory¨to¨even the¨best¨outcome¨of¨socialism.¨Indeed,¨such a¨fantasy¨may¨be¨more¨humane than¨a¨free¨market,¨but whether¨it¨is actually¨anything¨more than¨that¨(a¨fantasy)¨is¨another story¨all¨together, one¨which¨you¨have¨failed¨to¨convince us¨of,¨and¨one which¨there¨is¨no¨reason¨to¨believe judging¨from¨the¨nature¨of humans and our experiences in¨history¨itself.¨You're proposing¨to change¨human nature.¨Don't¨worry though,¨you're not¨alone; nine¨out of¨ten¨dictators agree¨with¨you.

If¨you¨wish¨to further¨your¨cause,¨it¨would¨be¨in your¨interest¨to¨address¨the¨points made¨about¨the¨flaws¨in¨your¨ideas¨and explain¨how¨your system¨would¨actually acheive¨its¨intended¨goals.¨You¨made¨no attempt¨to¨address the issue¨of the¨tragedy¨of¨the commons¨that I raised.¨You¨can whine¨all¨you¨like¨about the¨"injustices",¨but¨until¨you¨explain how¨and¨why your¨ideas¨would¨actually¨work¨you¨have¨zero¨crediblitiy.

Then¨again,¨perhaps¨you're¨just¨in¨denial.
Posted by G T, Monday, 22 May 2006 1:35:18 AM
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Tristan” There is hysteria about public debt and the prospect of public borrowing.”

That is because governments squandering resources on pointless or negative returning indulgences has been proved to diminish the wealth of the nation.

“As for your suggestion that I am a Nazi”

I did not suggest you were anything of the sort, I merely used a term which personified your attitude and desire for power without consideration for the will of the electorate.

Government is “by the people, for the people”.

It is not “of the people, for a minority of socialist intelligentsia” to experiment with.

To be honest, I cannot fathom how anyone can pretend to pen an article and then admit they have no faith in pursuing their ideals as outlined in same article, it sounds like the over-indulged whining of a spoiled brat and someone who has never known real hardship (eg chardonnay swilling socialist) who should be kept well away from the offices of real power and authority.

Well said GT
- "compassion", by definition is a "human attribute" which can only be dispensed by individuals on a one to one basis.

It is not possible for the "state" or any "state" to dispense it.

"Compassion" is one of the great lies of socialism and is held hostage by the power-hungry usurpers to simultaneously invoke emotion whilst masking cynicism.
Posted by Col Rouge, Tuesday, 23 May 2006 1:24:23 PM
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Col ,you are wasting your time.Tristan will only learn the reality through life's experiences[provided he gets a real job in private enterprise] and only then will he understand.

I was a bleeding heart lefty when I left school and experience soon taught me otherwise.Basically people must learn to help themselves and we should only be giving a hand up when necessary,rather than hand outs at the whim of socialists do gooders.
Posted by Arjay, Tuesday, 23 May 2006 6:44:19 PM
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“As for your suggestion that I am a Nazi”

"I did not suggest you were anything of the sort"

"...you to simply appoint yourself Reich Chancellor"

* speaks for itself really

"whining of a spoiled brat and someone who has never known real hardship (eg chardonnay swilling socialist) who should be kept well away from the offices of real power and authority."

You have no idea what my personal circumstances are - in this instance you would be better advised keeping your mouth shut.

Anyway - I doubt anyone's reading this thread now but us - and I am sick of being insulted.

I wonder what those concerned think about the recently introduced 'Sedition' laws. I'd bet on that issue I'm more 'liberal' than the lot of you combined.
Posted by Tristan Ewins, Thursday, 25 May 2006 4:08:11 PM
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Arjay “I was a bleeding heart lefty..”

Me too – typical human development,
a socialist by 18 or you don’t have a heart,
a conservative by 25 or you don’t have a brain……

Tristan “You have no idea what my personal circumstances are - in this instance you would be better advised keeping your mouth shut.”

I am still filling in time for you to respond to my following comments

“You have now missed repeated opportunities to challenge the life satisfaction versus taxation analysis which I presented.
Attacking me with side issues to deflect from your lack of analytical substance?”

and

“Again you continue to ignore the negative impact of taxation on life satisfaction and the last time I looked, we were here to experience a satisfying life, not to be drones to generate taxes…..”

So run away, I said previously, “You being someone, who admits you do not have sufficient faith in your ideas or ideals as to wish to test them at an election,“

Your last post confirms the lack of character you possess if you think that floating ideas and playing the “faux-compassion card” is all you need to qualify for political leadership.

As for keeping my “mouth shut”.
Who on earth are you to suggest I should be censored?

What right have you to expect to float airey-fairy nonsense in an article which anyone of us is entitled to shoot down in flames?

As for being sick of being insulted, I hear a thousand sub-human socialists calling John Howard all the things under the sun. I guess some folk like to “give it out” but lack the moral fortitude to “take it”.

So finally, may you go with these repeated words resounding in your ears

“Yes, well Tristan, if you want to test anything, I suggest you consider this, me and millions of other Australians have not given our permission for you to experiment with our national economy whilst treating us with the reverence a scientist holds for a lab rat."
Posted by Col Rouge, Friday, 26 May 2006 2:40:35 PM
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It’s a mystery, but I agree with Tristan as well as G T, Arjay, Col Rouge and Mr. Yabby.

G T wondered “how it is more ethical to force one person to give up their earned wealth to others than to not?”
I totally agree. Why should 80% of taxpayers be subsidising property and share investors in their tax write-offs (on interest payments)? If one borrows money, why would one ask someone else to pick up the tab? Is that responsible? Also, what is the 30% rebate for private health cover other than welfare for the rich? Why have we allowed the destruction of the public health system?

Arjay said “Basically people must learn to help themselves and we should only be giving a hand up when necessary, rather than hand outs at the whim of socialists do gooders.”
Couldn’t agree more Arjay, the sooner we get rid of negative gearing the better (cost to taxpayer last year estimated at $12B in claims for rental properties).

Col Rouge rightly declares “governments squandering resources on pointless or negative returning indulgences has been proved to diminish the wealth of the nation.”
Here, Here Col! Just how much longer does the average taxpayer have to subsidise the wealthiest members of society through negative gearing, family trusts and other rorts determined and sanctioned by the Board of Taxation?

Mr. Yabby, like myself, knows “plenty of welfare recipients who own their own homes”.
In fact, the average welfare recipient of the negative gearing scheme now owns 3 rental properties. Year in, year out 80% of taxpayers donate their hard earned taxes to the property investors through the tax system – enough is enough. Let’s scrap negative gearing and the Board of Taxation.

Tristan, with the help of the high calibre thinkers like G T, Arjay, Col and Mr. Yabby some light will be shed on the politics of division presently sweeping the world.

Mr. Agreeable
Posted by Mr. Agreeable, Thursday, 1 June 2006 5:21:31 PM
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Thanks, Mr Agreeable, for your post. I couldn't agree more. :-) Unfortunately I don't think there's many people reading this now, and while the Conservatives has slashed Disability and single parent pensions, I doubt they'll be doing anything about 'welfare for the rich' any time soon.

Tristan
Posted by Tristan Ewins, Thursday, 1 June 2006 5:37:14 PM
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My final submission; Mr. Agreeable, if you submit to the E T Gospel, Physics will devour you. If you submit to Darwinian evolution, then by your own admission, you are extinct.
So unless there is something else you need to say in defence of the indefensible, then by the laws of Physics / Mathematics, the decrement of demonic Ideology shall on its own, implode. So on that note Good By, And good luck.
Posted by All-, Thursday, 1 June 2006 5:45:06 PM
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Very clever post Mr Agreeable.

Tristan just because people aren't posting doesn't mean they aren't reading. For myself I was interested in the points you raised. Please keep up the excellent work. Have to admit I have been time short lately and have wished to post to this thread. Will endeavour to do so on similar in future.

Cheers
Posted by Scout, Friday, 2 June 2006 11:21:45 AM
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Mr Agreeable,
I would like to point out, the income and capital gains made through negative gearing strategies are both tax assessable.
Clearly, if you understood “Negative Gearing” you would also understand that, by definition, it actually costs the investor money to pursue a negative gearing investment strategy.

I would further point out, every other (legal) form of commerical investment is treated like property investment, viz, gains are taxable, net of the costs incurred in their production. Making property investment some form of exception to this basic rule would destabalize the rental property with the consequence that investors would either flee the market (fewer rental properties) or demand higher rentals - either way, the rental property consumer and not the investor will be the one who "Pays". As was seem in the 1980's when the grim reaper (Keating) tried it.

Family trusts have limited life and very restricted tax exceptions. Again, I take it you know “the words” but not the consequences of such strategies and can safely assume reasoned debate on the matter would fly well over your head.

I am still waiting for Tristan to respond to the notion that our life purpose is to generate taxes for indolent governments to squander on his “warm fuzzy ideals” where some nice state of semi-coma is induced from those cozy feelings derived from knowing the state will look after our every need.

My view is, always has been and always will be

We were born to become the best we could be, to develop and grow as individuals through our own diligence and effort.

Obviously, “self reliance” is a concept beyond the grasp of some who post here
Posted by Col Rouge, Friday, 2 June 2006 2:34:38 PM
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Col, nicely put.

R0bert
Posted by R0bert, Friday, 2 June 2006 3:54:32 PM
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Negative gearing artificially inflates rental prices.

Corporate fraud robs the economy of far more $ than welfare fruad.

Majority on welfare DO return to work.

It is not illegal to own or be paying a mortgage while on welfare - I lost my job last year and had to claim dole - should I have sold my home and moved into car? Struggling to own home is a part of 'self reliance'.

Exorbitant disparity between executive level staff and workers - not good for economy as lower paid can't purchase home, buy consumer goods etc. If company can afford multi million $ CEO's then can afford decent living wage and safe working conditions for low level workers - otherwise shouldn't be in business.

Majority of people are both self reliant and cooperative or we'd still be living in caves - natural part of being social animal.

I guess Col Rouge has never ever had an accident or made a mistake - doesn't need anyone at all. Cold world if we were all the same as him.
Posted by Scout, Saturday, 3 June 2006 8:25:08 AM
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Hey Robert, thanks for the support

Scout “Negative gearing artificially inflates rental prices.”

Maybe you could explain to us all HOW rental property costs are inflated by negative geared investors entering the investment housing market.

The only thing which can “inflate” rental property costs are more people wanting to rent, not more people wanting to invest in rental property.

Your dissertation on corporate fraud is irrelevant to the discussion, so to the incidence or otherwise of welfare fraud. All fraud is illegal by definition and is to be seriously discouraged by all and every means.

Income disparity – that has a lot more to do with the “working-smart” versus “working-dumb” disparity of attitude and approach to work than simply executives being paid more than “workers”.

I currently earn $100,000 pa from a part time job (plan “C”) (not network marketing) and why – because my employer thinks I am worth it.
For the rest of my “work week”, I spend some time developing a service business (plan “B”)
And am also trading through a multi-streamed software company (Plan “A”).

I will drop plan “C” and possibly sell my investment in “B” when “A” kicks in.

I guess my 6 day a week combined job commitments might earn more than most but I “do” and “risk” more than most.
It is all about making “Choices” for ourselves and not relying on government largesse funded from the immoral proceeds of the excessive taxes Tristan would see us levied.

Re “Col Rouge and accidents” - when I had a heart attack and later when I had bypass surgery, my income was covered by an income protection insurance policy, which I have paid into for about 20 years. We can all seek to insure ourselves against the risks and vagaries of life.

Mistakes, I have made many and have paid the price, the worst was marrying an American. It cost me around $200,000. However, I have never ever suggested anyone else should bear the cost or contribute to my subsistence for that or any other “mistake” which I have made.
Posted by Col Rouge, Saturday, 3 June 2006 2:04:46 PM
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Col, my pleasure. I appreciate the perspective that you bring to these debates. My views in the balance between society and the individual may not always be as far on the side of the individual as I perceive yours to be (please excuse me if I've phrased that poorly).

There is a balance in there somewhere. I think that most of us work best when we work together helping one another as we go. I've done plenty of bushwalking over the years and the best walks are with a group with a mix of strengths and weaknesses where we help each other through the bits we struggle with but everybody does the best they can with what they have got.

I would not like to see Scout have to sell her home to get thru a short period of unemployment. At the same time I do not willingly give up the rewards of my efforts to help those who choose not to put in effort themselves. I doubt that the tax system and government are effective means to deal with issues like social justice and compassion but right now they seem to be the best we have got.

I hope that was not to much of a ramble, I've struggled to find the words I wanted to use to express where I'm at on this issue.

Cheers
R0bert
Posted by R0bert, Saturday, 3 June 2006 6:16:37 PM
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----"Negative gearing artificially inflates rental prices."

An absence of interest deductability does not decrease rents, it increases them, since investors will need to make up for the extra tax they are paying. House prices soar thanks to speculation fuelled by loose monetary expansion. Negative gearing is a consequence of this, not a cause - after all, negative gearing is, by definition, a negative return on an investment. What could possibly be so enticing about that? Interest is a legitimate expense, and its deductibility is not the culprit - our banking system is.

Abolishing negative gearing to curb speculation is like tying the hose up rather than just turning the tap off.

----"It is not illegal to own or be paying a mortgage while on welfare - I lost my job last year and had to¨claim dole - should¨I¨have sold¨my home and¨moved into¨car? Struggling¨to own home is¨a part of¨'self reliance'."

And helping yourself to taxpayer dollars for assistance is not.

----"Exorbitant¨disparity between¨executive level¨staff¨and workers¨- not¨good¨for¨economy as¨lower paid¨can't¨purchase home,¨buy¨consumer goods¨etc.¨If company¨can¨afford multi¨million¨$¨CEO's then¨can¨afford¨decent living¨wage¨and safe¨working¨conditions for low¨level workers¨-¨otherwise¨shouldn't¨be¨in¨business."

Perhaps you don't know how the concept of trade works. It is the voluntary exchange of things between parties and it is how pay is determined. There is no "miracle step" that occurs where "the poor" somehow gets scammed, unless of course someone is conned or coerced, which nobody here is advocating. Income disparity is not an "injustice" and it is entirely compatible with voluntary, honest trade. The only "injustices" in our market today are the persistent coercive interventions of the government.

It is also a myth that people will become "so poor that they won't even be able to consume to fuel the economy". In a free market prices always adapt according to demand. To suggest that sellers will constantly charge more than anyone is willing to pay, knowingly depriving themselves of a sale, is absurd.

----"Majority of¨people are¨both self reliant¨and cooperative or¨we'd still be living in caves - natural part of being social animal."

Which is exactly why (besides all the ethical reasons) we don't need to force cooperation or altruism.
Posted by G T, Saturday, 3 June 2006 6:45:23 PM
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Yes, self reliance does seem to be beyond the grasp of some people who post here.

Some people believe that they are entirely self-reliant. They seem to think that where they are today is entirely the result of their own “effort”.

For this to be true, such a person would have to have given birth to him/herself, raised him/herself, educated him/herself, produced all of his/her own food, clothing, shelter, tools etc.

Such a person, being so self reliant, wouldn’t need to drive on roads built by others, use technology built by others, read books written by others etc.

A person who considers him/herself completely self reliant must be deluded.

Such a person, who then feels the need to tell others (who he/she doesn’t need in his/her self reliant world) of his/her self-reliance, and insist that they engage in the same deluded belief, makes a mockery of him/herself.
Posted by tao, Saturday, 3 June 2006 11:17:36 PM
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With the exception of Col Rouge the rest of us are simply human and are a mixture of altruism and selfishness. Except for psychopaths who only help themselves. Not that I am suggesting Col is a self centred psychopath; that is the extreme end of obsession with self.

With the exception of Col Rouge, many of us need support from the government at some point in our lives. Be it Family payments, sickness, unemployment benefits or pensions.

With the exception of Col Rouge, we need infrastructure such as roads, rail, hospitals, schools, utilities and so on Either from direct government control or regulation that provides these services.


Like Col Rouge, it is very easy to blame those who hold the least power in our society – such as low level workers and those on welfare.

However, Minister Vaile said himself:

"It's very easy to make outrageous claims about security and fraud crackdown, but [we have] only 1 to 2 per cent welfare fraud - lower than credit card fraud. It's beyond [the Government's] return on investment to avoid it," Vaile says.”

From: http://www.smh.com.au/news/technology/public-security-v-privacy/2006/05/17/1147545390480.html

Or one can look for evidence of tax fraud compared to welfare fraud, why is there less effort put into eliminating tax fraud?:

From: http://www.alp.org.au/media/0506/mshspa310.php

“376 cases from the ATO totalling $42,552,008 in reported cost of fraud; and
• 26,188 cases from Centrelink totalling $41,910,587 in reported cost of fraud.

We have $282m funnelled into catching welfare cheats, but only $81m on catching tax cheats, even though the tax avoidance measures provide a much greater return.

According to the 2006/07 Budget Papers:

• Each new dollar spent by the Australian Tax Office on tax avoidance will return $7.53 in increased revenue.
o ($81.6m budgeted for gross savings of $615m on ‘High Wealth Individuals Taskforce’ – see pg 32 of Budget Paper No.2 06-07)

• Each new dollar spent by the Department of Human services on welfare fraud will return $1.94 in increased revenue.
o ($282.3m budgeted for gross savings of $548.3m on ‘Fraud and Compliance Measures’ – see pg 283 of Budget Paper No.2 06-07)”
Posted by Scout, Sunday, 4 June 2006 9:26:02 AM
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Negative Gearing. Cause and effect. –ve Gearing is nothing more than a scam on the tax system. It enables people to purchase homes purely for profit and results in price increases, this forces up rents and also squeezes out the home buyer who cannot afford to compete with property investors.

I had the opportunity to offset my mortgage in this manner. I declined - my ethics alarm sounded. It may be legal but it is wrong. It is simply a means to offset losses in one area against income from another to reduce tax. For this reason some countries limit amount that can be claimed as a loss or disallow property depreciation.

Andrew Murray put the case against –ve Gearing far more eloquently than I:

http://www.onlineopinion.com.au/view.asp?article=767

Low Incomes: logic simply states that the more money a consumer has available to spend on commodities the more profitable the market. I certainly restrict my purchases according to income and need. I am hardly unique in this. Also low incomes further restrict people from purchasing their own homes – hardly a positive for the economy.

The economy continues to serve the high end of town – any complaint against this is seen as some kind of communist plot – absurd as it is anachronistic. Or simply jealously on the part of the complainant. It is not jealously to want a roof over one's head, food on the table, clothes on one's back, schooling for one's children - is it in fact a desire for a reasonable standard of living.
Posted by Scout, Sunday, 4 June 2006 9:31:54 AM
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Robert thank you – my view, unlike Tristan, I do not seek to impose my “balance” upon you. You are free to find and follow your own “balance” for yourself.

GT eloquently put.

Tao “self-reliance” is part of the process of developing into a complete person and individual.
An antithesis is co-dependence. Co-dependence is a recognised mental disease. I suggest you would do better to acquire some level of self-reliance than spending your time knocking it in other people.

Scout three paragraphs starting with “With the exception of Col Rouge”

Now, what does that say about your strategy, attitudes and values?

Isolate me from everyone else, engender the “pack” mentality against one person?

I would like to see where I have ever suggested we “blame those who hold the least power in our society”.

Whilst you’re at it, you can also point out where I have ever suggested people would be better off without altruistic values.

I would point out the whole idea of altruism and compassion are values which are uniquely human. They do not exist in lower animals and they certainly cannot be adopted by government.

I would further remind you that “government” is their to serve the people, it is not, as Tristan would have it, there to enslave them to a regime of “punitive taxation to deprive them of the benefit of their individual success”.

As for your dissertation on negative gearing. Complete and utter prejudice and bunkum.
Wedge politics at its worst.

Rouse the dogs of jealously and envy in the “have not’s” (without the wit or commitment to buy property) against those who have forgone immediate indulgence and gratification to save for their own future through negative geared investment.

Again it has nothing to do with fraud, be it domestic or corporate.

That is just another “wedge” of dissent and division which any cheap skate politician can pick up and chant to justify their lack of real policy (as we see every day from the federal opposition).
Posted by Col Rouge, Sunday, 4 June 2006 1:35:00 PM
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Scout, I think you need to look at this topic in terms of degrees.
Nobody questions that people can get into trouble and that society
should assist them to get their lives back on track. You have clearly done your bit over the years. Once we hit 50, yup its harder to find another job.

The bone that I have to pick is with young ones who think that the world owes them a living. They demand all sorts of things, yet upon
investigation, its often clear that they have never done anything
to help themselves and have no intention of doing so.

You might have heard that the economy in WA is booming. Huge salaries are being offered in the mining industry, in the North
West of WA. Yet when a whole lot of Perth unemployed were questioned if they would take a job there, all bar one said no.
They were not prepared to leave their friends and family to earn
1500$ plus a week, even fly in fly out.

I'm sorry but I think that these kids are getting life far too easy.
If they are not even remotely prepared to get off their little arses to help themselves, why should hard working taxpayers get out of bed every morning to provide for them?
Posted by Yabby, Sunday, 4 June 2006 4:02:01 PM
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Nice try Col

In your earlier posts your concept of “self-reliance” was that of relying completely on our own resources, as opposed to those people who know that “the state will look after our every need” - by which, obviously, you meant material needs. By this we can also infer that you consider that you, being a “self-reliant” person, do not rely on the state, or anyone, to look after your every need.

Obviously, there is no-one who is completely self-reliant when it comes to meeting their material needs – unless of course you are some Kalahari Bushman, and even they hunt in groups, and rely on information and skills passed down to them over generations.

So then you try to change (your own) meaning of self-reliance to “part of the process of developing into a complete person and individual”; which you imply is a psychological process that is removed from all external social and material influences.

And what does co-dependence have to do with anything? Co-dependency is an emotional dependency on caring or supporting other people. You seem to imply that those who, naturally and inevitably depend on others, and significantly, recognize that dependence (or inter-dependence), are mentally diseased.

All of this mental gymnastics appears to be designed to paper over the truth which is that you – the self-reliant one- actually rely on the work of others to meet your every material need.

When you actually recognize and acknowledge this fact, you may find that you are indeed well on the way to “developing into a complete person and individual”
Posted by tao, Sunday, 4 June 2006 5:45:39 PM
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And lets shine some light on a few other holes in your theory of “self-reliance”.

Those people who have “forgone immediate indulgence and gratification to save for their own future through negative geared investment” in fact “rely” completely on the existence of other people who are not in a position to own their own home, and are using money earned by their tenants - from their work - to pay off the mortgage. You call that “saving” for their future – more like stealing for their future (legally of course). Not only that, when the rent paid doesn’t cover all of the outgoings, they put their hand out to the tax payers of this country for a tax deduction.

Their ability to do so is “reliant” upon the laws of this land which are administered and enforced by the state. But you detest people who rely on the state for their every need, don’t you Col?

Indeed, the profitability of every other “investment” is “reliant” upon the work done by others, and the laws of the state.

So in reality – you know – the real world, not your little bubble world, the only thing you do with your little plans and schemes is work out how already wealthy people (including yourself) can further extract money from the people who do the real productive work i.e. you are a parasite. And you rely on the state to make it “legal”.
Posted by tao, Monday, 5 June 2006 12:22:06 AM
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Col when you bragged about your income, your self reliance and your attitude that because you are financially successful, if others aren't they must be losers. You like to emphasize your total independence from others. For these reasons it was entirely apt for me to emphasize your isolation from the general populace such as myself, by the method I used.

I note that you still have nothing to say about tax fraud and appear unable to justify negative gearing in ethical terms.

Yabby, mate, you had a go at people receiving welfare living in their own homes - in other words you started it. Also it is a shame you hold such a dim view of the younger generation. Perhaps they just value friends and family over isolation and $ working in a mine. Strange how every generation views the up and coming one as ungrateful.

Money is not what it is all about.
Posted by Scout, Monday, 5 June 2006 11:33:30 AM
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Scout, I don't take a dim view of the younger generation at all.
There are plenty out there thriving, doing their thing in life.
I take a dim view of the Tristans of this world, who complain about how bad things are and how taxpayers should provide bigger handouts.

Most of those doing the loudest complaining, could quite easily
get off their little arses and do something for themselves, rather then expect life on a plate.

Depends what you call having a go btw. Yup I highlighted the fact that many on welfare own their own homes and cope quite well with
their budgets. Lucky them, go to Europe to see how many own their
own homes, lots of workers can't even afford that there. So things
in Aus are relatively actually pretty darn good for welfare recipients.

Money is not what its all about, but money matters to pay the bills
for services and goods that we expect others to provide for us.
I'll work to pay my own bills and don't expect others to do it for
me. But I'm also aware that Govts spend about 40% of GDP, so most of us who do work, work about 5 months of the year for the common good, we do our share
Posted by Yabby, Monday, 5 June 2006 1:17:25 PM
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Tao “the self-reliant one- actually rely on the work of others to meet your every material need.”

Hardly but attempting explaining it to you would be akin to “casting pearls before swine”.

As for “When you actually recognize and acknowledge this fact, you may find that you are indeed well on the way to “developing into a complete person and individual”

I will develop more as a “complete and individual person” than those cripples who covet the constriction of co-dependent relationships with their fellow humans, as promoted by the politics of socialism (I experienced growing up with that crap in UK in the 1950’s and saw the collapse of the British economy in the late 1960’s as the outcome).

Now “using money earned by their tenants - from their work - to pay off the mortgage.”
Nothing comes free in this world, get used to it. I suggest you stop looking for the state or your landlord to support you in the manner you have come to expect. Parasitism is not becoming – (although you would claim it of me, the real parasite is you).

“But you detest people who rely on the state for their every need, don’t you Col?”

I detest no one, I am not responsible for them. However, do not assume I lack compassion or altruism You just do not know, the likely cry of the co-dependent is to value themselves on what they “claim” to do for others. The self-reliant do what they see as needs doing, without expectation of social acclaim or return.

Tao, in the real world, the self-reliant can trade with other self-reliant people to mutual benefit.
Your piffling rubbish would enslave us all to the dictates of some central committee (doubtless controlled by you and your parasitic ilk, who do not care one iota about the people just power and to “rule”. You just talk the talk of division and envy.

Scout, you have judged who are “losers”, not me.

“Money” is never what it is all about, It surprises me you can get off your "envy-platform" to even realise that.
Posted by Col Rouge, Monday, 5 June 2006 4:55:44 PM
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Col

Yes, attempting to successfully and coherently explain your (patently unoriginal) theory which is completely underpinned by an unsound and unsupported premise would be a bit difficult, even with your “reliance” on your multiple qualifications taught to you by others, and the theories left to you by your ideological forebears a few hundred years ago.

The result is diversionary tactics, upside down logic, introduction of further completely unsupported statements and judgements, and just plain obfuscatory vituperation.

An entirely unconvincing effort, displaying the intellectual rigour of a year nine boy.
Posted by tao, Monday, 5 June 2006 7:54:52 PM
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Scout, once again, there is nothing enticing about negative gearing. IT IS A LOSS MAKING VENTURE. People do not buy properties to negatively gear, they buy them because they believe they will increase in value, and this speculation adds even more demand, further increasing the prices of property. So wouldn't the obvious question be: "where are they getting the money from to fuel this demand?" Clearly, it is obscenely loose monetary policy causing speculation, NOT negative gearing.

----"Low¨Incomes:¨logic¨simply¨states that¨the¨more¨money¨a¨consumer has¨available¨to¨spend¨on¨commodities the¨more¨profitable¨the¨market. I¨certainly¨restrict¨my¨purchases according¨to¨income¨and¨need. I¨am¨hardly¨unique¨in¨this. Also¨low¨incomes¨further¨restrict people¨from¨purchasing¨their own¨homes¨–¨hardly¨a¨positive for¨the¨economy."

Naturally, more wealth equals more wealth, but redistribution of wealth does not create more wealth. It is idiotic to say there is an advantage in redistributing wealth from person A to person B so person B can buy more of person A's goods. Where is the new wealth? How does this benefit the economy as a whole? It just creates distortions and retards wealth creation in general by removing incentive. The state cannot create new wealth - if it did then it wouldn't have to leech off private individuals through taxation.

* * * *

tao, what is your point exactly? Of course people can't be completely self-reliant. They can be self-responsible though. I believe there has been a confusion between these two concepts which you have exploited to subtly try and justify collective responsibility. If this is not the case, then again, what is your point - how does this relate to taxation or provision of public services? The need to rely on others in no way necessitates forceful redistribution of wealth.

----"Not¨only¨that,¨when¨the rent¨paid¨doesn’t¨cover¨all¨of¨the outgoings,¨they¨put¨their¨hand out¨to¨the¨tax¨payers of¨this¨country¨for¨a¨tax¨deduction."

Tax not paid is not a subsidy received.

Why should anyone pay tax on net income they aren't earning?

----"Their¨ability¨to¨do¨so¨is¨“reliant”¨upon the¨laws¨of¨this¨land¨which¨are administered¨and¨enforced¨by¨the¨state. But¨you¨detest¨people¨who¨rely on¨the¨state¨for¨their¨every¨need,¨don’t¨you¨Col?"

This point is fallacious, as it is the INACTION of the state that results in negative gearing, as negative gearing is a deduction. In fact without a state, nobody would be paying ANY tax. Saying you need a state to obtain deductions is like saying you need to have a door to walk in to a building.
Posted by G T, Tuesday, 6 June 2006 2:52:08 AM
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Col you claim I am on an "envy-platform" apart from being a cheap shot I have not given any indication of envying anyone for the specious reason of wealth.

Therefore, do not judge me by your superficial values - you are the braggart after all - if you did not believe that money is so important you would not have made the claims you did.

The people I do envy are those with the moral fortitude to work in places like E Timor, Afganistan and other sad places in the world. I do my bit with volunteer work here at home but am aware of my limitations. However, by posting on forums like OLO to discuss more equitable distribution of wealth is another way of participating in our society and may be even making a difference to someone.

Yabby - I posted figures for Welfare fraud - they amount to about 10% of those claiming welfare, if that. Our economy is under more threat from corporate greed and corruption than some pathetic dole bludgers. Also the subsidies provided by government to corporations far exceeds the welfare budget (be interesting to see how much the nuclear industry will be subsidised for example).

I have paid pay taxes all my life and am grateful that the welfare safety net has been there when I needed it. Tristan does not sound at all greedy he is simply looking for more equitable ways for people to get on their own feet and become self-reliant.

GT - the redistribution of wealth (my past claim for welfare) has assisted me until I could find work again. I am now able to contribute by way of spending and taxes to the economy. I think maybe Economics 101 would help you to understand.
Posted by Scout, Tuesday, 6 June 2006 10:26:19 AM
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Tao

Let’s put it this way,

I will happily continue in my “wayward” way, voting according to my conscience and against the evils of socialist control.

I will pursue and promote the values and ethics which I have found successful and thus adopted, regardless of your take on them.

I will exercise my democratic right to accumulate wealth, pay taxes and exercise patronage, altruism and compassion in the directions and causes which suit my desires and pull at my heart, without some trumped up, tin-pot bureaucrat telling me who, what and how I should deploy my discretionary income.

I will be happy, when I eventually shuffle off this mortal husk knowing, I lived my life honourably, honestly and I brought children into the world to teach in the tried and tested values of self-reliance and responsibility, with which they will enrich the general population by not being a drain on it.

You on the other hand, reduced to patronising sneers, can play socialist mind games with yourself and cry into your half-a-lager on a Saturday night (as far as the pension stretches) when you realise, too late, that your theories are just so much dust and your co-dependent existence might as well have never happened.

Scout
If you do not envy, why do you desire to control the actions of strangers by imposing punitive tax laws upon them?
Then again, maybe “envy” is wrong, "co-dependency" is about control and manipulation, maybe that is where you are really coming from.

GT Good points – The “state” is the most inefficient model for service delivery of any sort, be it education, health or Industrial and commercial indulgences like Banking and Airlines.
Governments suffer a lack of incentive and prudence when compared to that exercised by people who are spending their own hard earned money and resources
Posted by Col Rouge, Tuesday, 6 June 2006 12:41:16 PM
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"Also the subsidies provided by government to corporations far exceeds the welfare budget"

Scout, the welfare budget is 90 billion$, so somehow I think you
have your facts wrong there. Meantime personally I think that
corportations should paddle their own canoes too, just like the
rest of us.

Govts would have no idea what % of welfare fraud exists, as
many on disability pensions, with so called bad backs, seem to be able to do all sorts of other work, cash jobs etc, yet still claim
pensions. Clearly they are not part of the fraud statistics.

We agree to disagree about Tristan's attitude, which IMHO he made quite clear, along with his political agenda.
Posted by Yabby, Tuesday, 6 June 2006 2:17:11 PM
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GT

My point initially, was that no-one is able to sustain their life without relying upon the efforts of others, which you have reasonably acknowledged. Previous posters had used the term self-reliance so I was quite justified in exposing the assumptions underlying its use. It was not me who was confused by the concept, but others. You may call what I have done exploiting, I call it clarifying. That clarification has now led you to reconsider the term and present a (perhaps) more fitting description of what you (and others) are attempting to convey. However, once the term is exposed as furphy, most who use it are generally reduced to immature irrationalities and personal justifications, as is evidenced by Col.

Although you all seem to be aware of the repercussions of my point (particularly if people seriously consider the implications), I have not advocated or justified anything. I have simply negated, or shown to be false, a fundamental premise upon which a certain belief system rests. Why do I need to have any other point?

My comments regarding negative-gearing were primarily to illustrate the fact that the despite similar assumptions that people who engage in negative gearing are being nobly “self-reliant”, they are in fact reliant on others.

However, people who use negative-gearing do not only rely on taxation laws (or lack thereof as you suggest), they rely on all other laws which exist to enable and protect the appropriation of land and accumulation of wealth. Those laws are administered by the state apparatus which, if ultimately the laws are not obeyed (by say, the great unwashed), will resort to outright violence to enforce them (police, military etc.). If the laws and apparatus of the state (together with the brain-numbing ideology) did not exist I dare say the propertyless would have no hesitation in re-distributing that property and wealth in a far more equitable manner. It is the wealthy who rely on the state for far more than the average person. No taxes and no state would mean no police - the wealthy would be very vulnerable indeed.

Cont...
Posted by tao, Wednesday, 7 June 2006 8:36:44 AM
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You wrote: “Redistribution-of-wealth-is-completely-unethical-as-it-requires-great-coercion-to-pry-peacefully-aquired-property-out-of-the-hands-of-another,-and-if-it-must-be-done-then-it-may-only-be-justified-when-done-to-protect-every-individual's-natural-right-to-freedom-and-property,-and-certainly-not-to-impose-some-idealistic-subjective-fantasy-on-everyone.” Quite right GT.

We should consider what you mean by peacefully acquired property. In this country in particular, and in most other countries, the transition to private property was anything but peaceful and did in fact require great coercion – violent coercion. Not only that, it denied the “natural right to freedom and property” for the original inhabitants of this land. Not only that, it denied many of them their right to life. That redistribution of wealth was completely unethical, and justified by an idealistic subjective fantasy imposed on others.

You said: “the-"fruits-of-our-labour"-belong-to-whichever-individuals-laboured-to-obtain-them,-not-to-society-as-a-whole.-Neither-you-nor-anybody-else-is-entitled-to-the-wealth-created-by-another,-just-as-nobody-but-you-is-entitled-to-your-wealth.” Almost right GT

Firstly, who is deciding that “fruits-of-our-labour” do not belong to “society-as-a-whole? Is that just your opinion, or is it a fact? If the majority decide that the fruits of their labour do belong to society as a whole, what is the fact?

If “neither-you-nor-anybody-else-is-entitled-to-the-wealth-created-by-another” and “the-"fruits-of-our-labour"-belong-to-whichever-individuals-laboured-to-obtain-them”, why is it that 5% of people own 95% of the wealth? 5% of people surely can’t have done enough labour to produce 95% of the wealth. Of course, you said “obtain” not “produce”. There is probably a distinction. Anyway, I’ll be interested to read your explanation.

Now, not that I’m really interested in defending welfare state taxation regimes, it should be pointed out that what you call the coerced redistribution of wealth (taxes) has in reality only given working people back some of the wealth they have produced which has been, and still is, coercively taken from them. This was done, not for some bleeding heart lefty reason, but precisely because states (and the wealthy people they protected) all over the world were in danger of being overthrown by the very people who created the wealth (if you don’t believe me read some history). It was a very pragmatic decision, made to protect the “rights” of the wealthy to “freedom and property”. A decision which is now being reversed.

The state exists to police inequality
Posted by tao, Wednesday, 7 June 2006 8:37:42 AM
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Tao “The state exists to police inequality”

Define “inequality”

Is “equality” when people are given “Opportunity” “Equally”?

Is “inequality” when some choose to live in remote areas, away from services and others decide to move to live near services?

When people are made aware of what services are available and where they are located should they be responsible for getting to them themselves?

If we supply services to those who are distant, what “equality” of delivery is there for those who inconvenience themselves to live nearer?

What about those who squander the “opportunity for equality” and the improvements it would bring by following short term gaols and immediate gratification of wants versus the prudent and thrifty attitudes of those who curtail immediate gratification of wants to consider their resources in harder times?

Should we discourage football and swimming stars because of their “unequal” ability in their chosen fields of endeavour?

As dear Margaret Wrote

“Let our children grow tall, and some taller than others if they have it in them to do so.”

So “The state exists to police inequality”

The Hell it does,

If growing “tall” “disadvantages” the vertically challenged, how should government “police” that inequality, cut the feet off the tall?

The “state” exists to serve the wishes of the population.

It has not and should not be the arbiter of “equality” because such “power” should never, ever, be vested in any institution, when it would only be used to curtail the liberty of the members of the population it is appointed to serve.
Posted by Col Rouge, Wednesday, 7 June 2006 10:31:18 AM
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OK Yabby lets have a look at this Welfare Budget of $80 B – not your stated $90 B.

There are 2.7 million Australians on some form of government support - up from a million a decade ago when the Howard Government took office.

The paradox of welfare under this Government is that it has boosted spending on electorally popular "middle-class welfare". Massive subsidies on private health and child care, baby bonuses and cash handouts for self-funded retirees have been paid to millionaires and paupers alike.

Andrew McCallum, President of the Australian Council of Social Service says: “I think that the Treasurer's actually provided a very good welfare budget, but most of the welfare goes to those earning over $100,000 a year.

I mean, they've done very well out of this. They've lost their super tax surcharge, and in a couple of years they'll be paying virtually no tax at all. The top five per cent income earners really have done very well, while those on welfare are really going to be punished.”
http://www.abc.net.au/cgi-bin/common/printfriendly.pl?http://www.abc.net.au/pm/content/2005/s1364604.htm

This means that one of the biggest beneficiaries of the latest budget has been people like Col Rouge – if his boasts are to be believed.

A complete perversity that sees taxpayers subsidise braces for middle-class children while poor people can't afford to see a dentist!

Now Col I have never suggested “punishing” tax rates. I have simply pointed out the rort that is negative gearing. GST is really where excessive taxes hit hard. Having been on low income and paying the same GST as those on high incomes is hardly equitable.

While you would probably rather see people starve, a welfare safety net is simply a necessary part of living in a democratic humane society. I have had personal experience of welfare. It is very depressing and demoralising having to claim for welfare, however I would’ve lost my home without it.

Australia is a wealthy country by any measure. How it treats all its citizens is a measure of its humanity.
Posted by Scout, Wednesday, 7 June 2006 12:13:47 PM
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Scout “the rort that is negative gearing”

If someone were to invest in shares instead of houses,

The income (dividend) would be assessable for tax, just like property rental income is assessable for tax.

If they were to borrow funds (commonly called leverage as well as Gearing) to buy those shares, the interest they pay would be a valid cost to offset against the assessable income, just as the interest payable on real estate is offset against the rental income derived from real estate. Basic Australian Tax Law.

If the shareholder disposed of the shares at a profit or a loss, the gain or loss would be assessable for capital gains tax, just like real estate.

“Negative gearing” is not a rort, regardless of your personal view which seems to come down to “people should not be allowed to prudently conserve their resources by holding investments”.

You might be happy with government savings bonds being the only form of deferred consumption but for a lot of us, such notions display the worst of nanny-state interference in things which government should not be squandering their time, effort and our tax dollars on.

“Having been on low income and paying the same GST as those on high incomes is hardly equitable.”

You pay GST on those things which you choose to buy and not on those things you do not buy. People who choose to spend more on goods and services will pay more. If you do not like spending so much on GST, I suggest you take control of your spending.
Try saving something for your old age, like I do.

I suggest , invest where you can get a good but reasonably safe return. Real estate is an excellent option (lower volatility than Shares).
However, if you have money in Superannuation funds, you are already a property and share speculator, what do you think of that?

I am “balancing” my strategies. Something else which whilst reasonably secure (lacking in risk), offers far better returns (a “niche” opportunity but sorry, I am not sharing where or how).
Posted by Col Rouge, Wednesday, 7 June 2006 1:59:52 PM
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Scout, I kept the FR supplement about the 06 budget. The forecast
is 91.7 billion for welfare. Another 40 billion for health,
18 billion for defence, then 17 billion for education. Voila,
just on those, the majority of the federal budget is spent. 75%.

Yup, they are giving more assistance to workers who earn less,
I don't have a problem with that. A wise Govt helps people to
help themselves. Most on welfare could help themselves a bit more.

If I was unemployed, I can think of 100 ways to make a living.
A mop and bucket and "Yabby's Cleaning Service" would open tomorrow.
People want their gardens done, lawns mowed, pets taken for walks,
handyman repairs done, houses cleaned, etc. etc. the service industry is endless. Babysitters are in big demand, now thats not really hard work, anyone can do it.

So IMHO, alot of the welfare story is simply about attitude, its not for lack of opportunities out there.

Considering the % of expenditure spent on welfare in this country,
yup its generous. Now you can argue that those with kids should get less etc, my point is that if you look at the big picture, Australians on welfare are doing ok. If I had toothache, I'd soon find a job to pay for a dentist. If you don't like the conditions that employers offer, so start your own business. You are an intelligent lady, with lots of verbal skills, as you have shown on here.
Posted by Yabby, Wednesday, 7 June 2006 3:29:56 PM
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Sorry Col,

Perhaps I should have clarified it for you – by inequality I meant “social or economic disparity” (Collins English Dictionary). Must have been one of those pearls you were talking about!

I’m not quite sure what point you are trying to make with your example of services in remote areas (or in fact any of them). I suppose all those people who live in country areas do have the choice to move to the city. We could all then just grow veggies in our balcony gardens and shoot pigeons as they fly overhead.

In fact why not just invite the world’s entire population to live here so they can access everything we have. No clean drinking water in Africa? Come to Melbourne, we have the best in the world. No health services in Iraq because we bombed all the hospitals, get over here and get your medicine yourself. You people “chose” to have your infrastructure destroyed. Get your arses into gear you slackers!

There is something amiss with your logic about the “opportunity for equality”. I think what you are trying to say is that we all have the opportunity to rise to a level of “equality” of material wealth (and personal development), and that those who don’t have squandered that opportunity. Following from that logic, if we all took the opportunity that supposedly exists, then one of the consequences would be that there would be no investment properties, we would all own our own home and wouldn’t need to rent. Not only that we would all be able to live in a mansion on the North Shore, or in Toorak. Another consequence would be that, say we all ran our own business, there would be no employees. If we all became our own boss, there would be no-one to collect rubbish, clean toilets, work in a mine, work in a factory etc. because if you had a choice you wouldn’t do those things for a living. Who would build our mansions? I would actually really like you to explain how you conceive that this would work.

Cont...
Posted by tao, Thursday, 8 June 2006 8:44:03 AM
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Of course we shouldn’t discourage sportspeople to do their best, but we don’t need to pay them millions while others starve - particularly as they are not actually producing anything which is useful to humankind (entertaining maybe).

Being considered tall, requires the existence of short people. Without them, a “tall” person is just whatever height he/she is.

I believe it was Isaac Newton who said “If I have seen further it is by standing on the shoulders of giants”.

I didn’t suggest that the state should be the arbiter of equality, I said it exists to police inequality (i.e. social or economic disparity). If you don’t agree, tell me what you think would happen to the economic disparity if there was no state, no laws, no police to protect private property, no capitalist ideology pumped out to us justifying a situation where a minority of people have access to all the benefits of human endeavour while the majority starve by calling it “legal” and therefore “honest”? No “rule of law” to fall back on.
Posted by tao, Thursday, 8 June 2006 8:45:00 AM
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Col

1. You are comparing apples with oranges by trying to claim negative gearing is just like buying shares. Negative gearing is a manipulation of the system. Deliberately setting up a loss to make a claim on tax. It is a loophole that should be closed.

2. GST. I do not make 'choices' with regard to electricity, water, gas etc. These are essential services and incur GST. Originally GST was supposed to be a 'luxury' tax - it is not it affects everyone irrespective of income.

Yabby - The $80B is from current budget. If you want to indulge in petty point scoring stick to Meg1.

While I agree some people can do more than they do to earn money - not everyone can just pick up a mop and go cleaning. I know I don't have the physical capacity anymore due to a chronic illness. As I pointed out in previous posts the majority of people on welfare ARE trying to get off it. Again I will point out that it is a small minority who are indeed bludgers - they will always exist. Why should the majority be penalised for the few? Why is tax fraud virtually ignored? Why are penalties lower for white collar crimes than other crimes?

It is very easy to pick on people who are powerless and vulnerable to exploitation. This attitude of 'I'm OK, so anyone who isn't must 've brought it on themselves' is only one step away from sociopathy. You have stated yourself that we are social creatures, why when it comes to welfare do you approve of corporate and middle class welfare and wish to deny it to low income people?

If you are going to claim that the welfare budget is too high, then I suggest you look at the entire picture rather than focussing low income people.
Posted by Scout, Thursday, 8 June 2006 12:15:30 PM
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Scout, this morning I went to a meeting of a group, trying to
establish a biodiesel plant. Before they can do
anything, they will need a host of permits and licenses and pay
heaps for them. It was mentioned that a grant was available.
If I had my way, we would all be better off without all the Govt
red tape and costs, as well as without the grants.

Let me explain my position. If I had my way, everyone would
be treated the same. Tristan’s position was that workers should
pay more tax, I strongly disagree. Govt does not spend money
wisely enough, for us to give them any extra. 40+% of GDP is
more then enough. If those that do work don’t have an incentive,
they simply won’t bother and your golden goose is gone,
something which people like Tristan and Tao don’t understand.

Yes, more money is spent on detecting welfare fraud then other
fraud, because welfare expenditure is also so much greater
then other expenditure. If you related fraud detection to Govt
expenditure, the picture would look quite different. But I agree
that all fraud should be exposed.

I don’t believe your story of the few in welfare fraud. The experience
that I have in my community, is that a great many on welfare see
any kind of work as optional. In WA, where the economy
is simply booming and employers are screaming for labour, a whole
stack of people have decided as a lifestyle choice, not to bother with
getting out of bed in the morning. They get away with it under one
excuse or the other, yet when cash is offered, they are willing to work
immediately lol.


Most middle class welfare goes to people with kids, prepared to help themselves.
Why should I object to that? I do object to people who screw the system
because its so easily screwable and don’t do their share. Certainly in
my community, its extremely common. I refuse to accept that taxes on
the average worker should be higher, to make life even easier for those
people.
Posted by Yabby, Thursday, 8 June 2006 10:57:53 PM
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Yabby,

“If those that do work don’t have an incentive,
they simply won’t bother and your golden goose is gone,
something which people like Tristan and Tao don’t understand.”

There is a very good reason for this. Tao is Tristan’s alter ego … necessarily emerging after Tristan successfully paints himself into a corner. I recognise those hyphens anywhere.
Posted by Seeker, Friday, 9 June 2006 9:35:44 PM
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Scout, I am wearing my accountant hat. The exact same rules of accrual accounting for income, expenditure, assets and liabilities, apply to trading in the supply of rental property (be it negative or positive gearing) as apply to trading in shares, as applies to selling ice cream from a van, groceries from a supermarket or electrical TV’s in an electrical store.

Each media of trade has a income, expense, asset retained values (be it ice cream stock, unsold electrical equipment, ripe bananas and tin of beans, share certificates or real estate) and possibly borrowed liabilities (bank overdraft, trade credit or a house mortgage).

Your idea of apples versus oranges is infantile rubbish.

Seeker you are right on the assent of tao following Tristans cowardly decline.

Now Tao /Tristan

You said “Of course we shouldn’t discourage sportspeople to do their best, but we don’t need to pay them millions while others starve - particularly as they are not actually producing anything which is useful to humankind (entertaining maybe).”

Neither you nor I nor any government or bureaucrat in government is sufficiently and competently qualified to judge how much a sportsperson, pop star, corporate executive or any other person should be allowed to earn.

The difference is, I and others who hold similar views to mine have the humility and personal insight to accept we do not know.

You, conversely, like most narcissi, embody such pretentious arrogance that you proclaim that some people who earn alot more than you “produce nothing of worth”.

From what I have read of your "ideology", there is nothing of worth that you have or are ever likely to contribute either. The difference between you and a football star is, whilst thousands of people are paying to see sports stars, whilst no one is likely to pay you.

Thank God you at least recognise that you could not promote your views to a voting public. You will save yourself the public humiliation and ridicule. It is a shame Latham did not show similar foresight in his pursuit of similar egoistic political grandeur before he imploded.
Posted by Col Rouge, Friday, 9 June 2006 10:18:30 PM
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Actually Yabby and Seeker,

I don't agree with Tristan much at all.

Tristan believes capitalism can, and should, be tinkered with to make it "fairer" in order to save it from itself. I don't.

Fundamental difference.
Posted by tao, Friday, 9 June 2006 10:19:02 PM
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Now Col,

On the one hand you say that narcissi proclaim that people produce “nothing of worth”.

And then you proclaim that I have “nothing of worth” to contribute.

Who is the narcissist?

Furthermore I don’t believe I have used the words “produce nothing of worth”. Your own counterargument cannot be very convincing if you have to invent an argument to attack.

Again it is interesting that you choose not to address any of the more serious issues I have raised.

For example, what will happen if we all take the “opportunity for equality” you seem to believe exists?

One wonders why, if you have such a great life as you constantly trumpet to us, you bother spending so much of your precious “valuable” time engaging in such inane, vacuous and malicious point scoring.
Posted by tao, Friday, 9 June 2006 11:00:32 PM
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In all seriousness, read this link for an explanation for a Theosophical perspective, on how some believe it to be; "Dependance on the State"; and the to control the masses and their minds. Lets not forget; "The what driver" of their Egos.
http://majorityrights.com/index.php/forums/viewthread/124/

Nothing like a good Exorcism. Ha.
Posted by All-, Saturday, 10 June 2006 7:27:34 AM
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Col I think you need a new hat - just dismissing a POV as 'infantile rubbish' reveals your inability towards lateral thinking. If you wish to engage in childish behaviour there are always the anti-choicers. Just because I see things on a broader perspective doesn't mean I am at all childish - quite the opposite.

I am stating a fact; to set up negative gearing is a manipulation of a situation - one could also rent out properties for a profit, however in order to claim off taxes it is necessary to arrange circumstances at a loss. It is a deliberate construct. By comparision, purchasing shares is a straight forward transaction.

Further GST injustices - home repairs: electricians, plumbers etc all charge GST. This has also resulted in increasing black market activity.

Col I am willing to discuss issues with you at an adult level, however you need to realise that not everyone sees the world in the same way as you and this does not mean it is incorrect. I thought you wre capable of discussion I guess I was wrong.
Posted by Scout, Saturday, 10 June 2006 8:11:40 AM
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Yabby

I have had over 20 years work experience in the welfare sector, both in unemployment and low income housing.

I can say I have met some very scummy low-lifes. My work often put me at risk. However, fortunately for our society, bludgers really are in the minority. I have no doubt you know some bludgers. They're not going to disappear anytime. Why should honest people be penalised for this minority?

Our bi-annual performance assessments were based upon stats - level of rentals arrears, level of vacancies and so on - straight hard facts. As a result I can state from proffessional experience that the fraudsters are a very small minority. I had to work with these people.

Out of the $80B+ welfare budget the total amount of fraud is less than 10% as I detailed in previous post stating level of tax fraud and welfare fraud.

The welfare budget is traditionally a soft target and government cuts would mean that the most marginalised in our society would receive even less support – not just financially but in all the support services that help bring the community together and keep it functioning

Further cuts would mean emergency services would stagnate, preventative programs such as early intervention strategies will be scrapped. It will be survival of the fittest.

But this shortsighted approach will have rapid economic consequences with an increase in the number of welfare dependent individuals and a loss of capacity in the workforce. In other words, if I hadn't been able to access health services and receive benefits, instead of recovering I would've become even more ill and ultimately homeless.

Life might seem fine if you’re one of the entrepreneurial elite – but pretty grim if you’re not - I have been there.

We must put an emphasis on prevention and early intervention to get maximum value out of our health and welfare dollar.

For all people, Yabby, not just the upper percentile. Seems to me you are happy to accept white collar crime at the expense of low income people.

BTW low income is NO indicator of CLASS.
Posted by Scout, Saturday, 10 June 2006 8:38:15 AM
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Try about 91 Billion dollars to date Scout,(and Growing 6 Billion dollars a year)Good dhimmi if you can get it; And out of a population of 20 odd million, if that figure is not damming of Immigration and the political hypothesis of philosophical assumptions, then it would indeed be a far better assumption of an Epistemological premise to educate and train people in the art of self determination instead of self destruction.
But hang on here a minute, who would like to see destruction?
It is one thing to invoke humanities as a defense; it is another to orchestrate the whole existence based upon total dependency on others. In a finite language worthy of biblical Theosophy. “The End of Days” or total collapse of societies." It has been done before", yourself; having part Jewish heritage should know and realize that.
We are progressing in leaps and bounds down that path of self destruction and annihilation. Are we not?
Posted by All-, Saturday, 10 June 2006 9:36:12 AM
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Why am I not surprised that Scout thinks “less than” $8 billion welfare fraud, is not worth pursuing? I seem to remember she held similar positions on paternity fraud and other matters of “moral hazard”.

Yes, why don’t we all look that up – try googling “moral hazard definition”.
Posted by Seeker, Saturday, 10 June 2006 10:08:09 AM
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Thank you Seeker and All for taking an interest in my posts.

I guess I haven’t made myself very clear. I shall reiterate
The statistics are:

“376 cases from the ATO totalling $42,552,008 in reported cost of fraud; and
• 26,188 cases from Centrelink totalling $41,910,587 in reported cost of fraud

Now please don’t forget that a considerable percentage of the health & welfare budget (which has increased under Howard) consists of middle class welfare AKA Vote Buying.

Middle class welfare includes tasty little morsels such as:

• 30% rebate on Medicare
• First Home buyers allowance – resulted in much fraud (putting homes in differing names) and jacking up properties values, thus squeezing out people it was meant to benefit.
• Baby bonuses
• Family Benefits Part B, which is paid when one parent with small children (usually the mother) has a low income, regardless of how much the other partner earns.

In fact any lump of cash that is ‘doled’ out and not means tested.

This is all a part of the welfare budget that so upsets out many posters.

If I am interpreting these posters correctly then they want to eradicate low income welfare in favour of middle class welfare. What an absurd and twisted piece of socialism is that.

Looks like class warfare from where I’m sitting.

Now I am NOT advocating that we should not route out welfare fraud, indeed we should.

What I question is why is there not the same outcry on white collar crime?
.
.
.

Off topic: Seeker I agree with you that absconding biological fathers SHOULD be tracked down and made responsible for their children. Even though it is a small percentage, non-biological fathers should not have to pay for children that are not their own unless they wish to.
Posted by Scout, Sunday, 11 June 2006 8:50:12 AM
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Tao wrote “.... particularly as they are not actually producing anything which is useful to humankind (entertaining maybe).’

Which equates to suggesting some people produce “nothing of worth”

Re ” what will happen if we all take the “opportunity for equality” you seem to believe exists?”

No one is stopping you or anyone else from taking advantage of every opportunity which falls at your feet, (except your own fears).

I am not “point scoring”, merely playing but I guess, for the blunt and obtuse, the “point” (any point) is never very clear or close.

Scout “I am stating a fact, to set up negative gearing is a manipulation of a situation - one could also rent out properties for a profit”

If you can direct me to a positive geared investment property, tell me, I would rather buy a “money-earner” than a “money-pit”.

Rental Market Reality Scout -

When the purchase cost carries, generally, a 7.5% cost of borrowing and only a 5% rental return, the difference, when added to maintenance costs etc. determines that until the equity value of the investment increases over time, any and every “investment property” purchase will be “negative geared”.

Property rentals are arranged under market conditions, if you can find properties which rent out at 10%+ of there market value, then I suggest you buy them up quick before the rest of the market discovers the opportunity.

If you had ever bothered to analyse what happens to a negative geared investment over time, you would realise “negative geared” properties turn into “positive geared” investments, (after between 3 to 10 years), simply because of the increase in rental revenue (moving with an increasing market value) relative to a comparatively fixed debt cost.

As for GST – the “black economy” has been around since income tax was invented. There have always been those who would seek to evade tax and risk the consequences, regardless of the method of tax. As for “home repairs: electricians, plumbers” and before GST there was Sales Tax, levied generally, at a far higher rate on the products and materials used
Posted by Col Rouge, Sunday, 11 June 2006 9:23:50 AM
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It would be far better to eradicate all welfare; at the moment it is not being used for that purpose.
I can agree with the premise that those that are better off should pay their own Medical etc, but on the other hand, it is those that have been burdened with the Taxation drain, and in all honesty, Federal, State and now local Governments are fast becoming organized crime rackets, which throw crumbs out to make it look like they care and have done something.
White Collar crime should be dealt with harsher penalties; so far even to force surrender of assets and Ill begotten wealth through fraud and theft, Include Politicians and Public servants of all descriptions in there also.
I can not see any class distinction what so ever in anyone’s posts that think and veirmantly disagree to Tristins socialist construct.
The supposed middle class in numbers is far less than the greater numbers that claim to be disadvantaged, making it easier for the lazy and the thoughtless to drain the resources in it self is criminal negligence. And that is compounding in numbers.
When it comes to allocating money to the real needy and those who are more specific in it’s distribution, find there is nothing left to be given; It has already been looted by the Lazy selfishness and the depravity of the a new age parasites. That is why the compounding effect will out grow normality. You see that in Skilled Employment, Crime figures, etc. There is a lot of Linguistic manipulation and basically a lot of liars ruling the roust.
It would not matter how much money Governments had, the end result will always be the same, nothing but misery.
Posted by All-, Sunday, 11 June 2006 12:30:16 PM
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Col

Most negatively geared investors are like a person in a leaky boat. Each of the leaks represents an outgoing for holding costs such as council rates, water rates, repairs and body corporate contributions. They are busily supporting their investments with their other income in a bid to keep their financier from calling in their loan. Their investments do not support themselves. What happens if they lose their job or are sick or injured for a long time?

Positively geared properties provide cash flow which is more predictable and stable than negative gearing or relying on the slow returns on capital gain.

At least you can see there is a difference in this type of investment and shares. While I find you cold and arrogant I have always thought you reasonably intelligent – perhaps you’ll just say anything to try and score points in a debate.

On blackmarket and sales tax (rolling eyes) yes I know. GST was supposed to solve blackmarket – as if.

I note that by your silence on the subject you must tacitly approve of white collar fraud and middle class welfare. If this is true why do you begrudge assistance to the unemployed or ill? - Majority of us don't stay unemployed or ill and can contribute to economy again, as I have done.
Posted by Scout, Monday, 12 June 2006 10:49:25 AM
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Dearest Col,

You wrote: “Re ” what will happen if we all take the “opportunity for equality” you seem to believe exists?”

No one is stopping you or anyone else from taking advantage of every opportunity which falls at your feet, (except your own fears).”

Once again, instead of answering the question you use diversionary tactics, make baseless assertions about me or others, and above all, completely fail to support your own argument. If you can’t make a sound case for your own argument, why should anyone bother to accept it?

As you refuse to make a satisfactory case, we will have to assume that you have conceded that your argument is unsupportable. Just as your claim to self-reliance is baseless, your example of services to remote areas is ridiculous and your “tall” person analogy proves nothing. And you accuse me of having nothing of worth to contribute.

You wrote: “Tao wrote “.... particularly as they are not actually producing anything which is useful to humankind (entertaining maybe).’

Which equates to suggesting some people produce “nothing of worth””

Sorry Col, but useful means “able to be used advantageously, beneficially, or for several purposes; helpful or serviceable”. Sportspeople don’t produce anything useful to humankind, although as I said, it is entertaining.

“Worth” has a number of meanings, including value, merit, high quality or excellence. I did not suggest that sportspeople (or anyone) doing their best was not of any value or merit, or that what they were doing was not of high quality or excellence.

I think you’d better take some lessons in the use of the English language.

Cont...
Posted by tao, Monday, 12 June 2006 5:30:01 PM
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...Cont

You wrote “Neither you nor I nor any government or bureaucrat in government is sufficiently and competently qualified to judge how much a sportsperson, pop star, corporate executive or any other person should be allowed to earn.

The difference is, I and others who hold similar views to mine have the humility and personal insight to accept we do not know.

You, conversely, like most narcissi, embody such pretentious arrogance that you proclaim that some people who earn alot more than you “produce nothing of worth”. “

No, the difference between us Col, is that you “embody such pretentious arrogance” that you use your unsupported ideological drivel to justify a situation where the majority of people in this world do not have enough food, clothing, shelter, medical care or clean water, while a minority have access to all of the benefits of human endeavour. This is defending the indefensible, and denies the reality whereby sportspeople can do what they do professionally, and others can earn high incomes, only because there are a multitude of people supporting their material existence.

You and your ilk carry on about “responsibility” and “self-reliance” and “individual effort” but abrogate all responsibility for your actions and actions of those you apologise for, handing it over to “market forces” as though the market is some God which is out of our control and has the power to give life and death. Then you assert that those who end up (or start) on the wrong side of those market forces are entirely responsible for their situation.

Your ideology is no better than organized religion justifying the divine right of monarchs, aristocracy and clergy and casting the rest as sinners. And when confronted with the unsound nature of the assumptions by which you live your life, which are no better supported than the word of God, you resort to puerile nonsense.
Posted by tao, Monday, 12 June 2006 5:31:18 PM
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Negative geared investors are free to invest where they want. Obviously a lot of people “get it” and see the term benefits otherwise they would invest elsewhere.

Your assertion of “Gearing is nothing more than a scam on the tax system.” Has now turned to suggesting that those who freely choose negative gearing investment strategies are some sort of victim with “Their investments do not support themselves.”

What do you care that someone can see beyond their next meal far enough to “get it”.

As for “What happens if they lose their job or are sick or injured for a long time?”

Plenty of people “over gear” to invest beyond their means, it is called dumb greed.
If someone cannot afford to carry a negative geared investments, then do not go into them, same goes for part paid share subscriptions, if you cannot the obligation, don’t buy in. Exactly the same applies with even greater consequences to being one of the “names” at Lloyds insurance.

Realists realised GST was not going to eliminate the black economy. The ATO have far better commercial intelligence on which jobs roles scamming and by how much, partly due to the amount of detail collected on BAS statements.

Tao, what you find “Satisfactory” in terms of presenting cases is a matter of complete irrelevance. You are simply being argumentative and have failed to answer my earlier requests, when you called yourself Tristan, to explain why you believe we are here to pay tax rather than have a satisfying life. How about exercising some honesty.

Your quest to enslave everyone under your will of “everyone forced to exist under Tristans Rule” will not get past the starting line.

Nice hissing fits on me viz the divine right of Kings. It is something similar to authoritarian monarchy or religious dictates which you would seek to impose. Dictatorship of the proletariat, damn the Kulaks, starve them to death, like Stalin.

FACT - Everything which I promote diametrically opposes the notions of Divine Right of Kings and stands squarely against all forms of religious or authoritarian social orders.
Posted by Col Rouge, Monday, 12 June 2006 8:01:40 PM
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Col’s modus operandi is not to study other’s posts – he is at risk of learning something if he did. His method is to scan for what he believes is any weakness or a statement he believes he can contradict.

For example, he stated that people who invest in negative gearing and become ill lose out due to their own ‘dumb greed’. Is this an admission that negative gearing is indeed greedy? In which case, Col must be assumed to be greedy as he advocates this form of investment.

Apparently, in Col’s world, people are supposed to predict illness or accident. Or is it simply another example of Col’s ‘blame the victim’ mentality?

Whatever, Col's claim to be self reliant is a flawed philosophy. There is no such thing as complete self reliance. At one time Col was a helpless baby; in his future, as for all of us, he will become feeble and old. Where will his self reliance be then? In the meantime I assume he doesn’t need roads, electricity, food, water or even friendship.

He may well claim that due to his (self confessed) greedy manipulations he has enough money to ensure an independent old age. Just how independent can one be in a nursing home waiting on a nurse to wipe his backside? Meanwhile his family squabble over his ‘fortune’.

On another thread Col stated he did not trust government as his interests were in competition with 20 million other Australians. This was very revealing. Col has no faith in democracy AND he sees himself apart from the rest of us. While I don’t believe that Col is a true psychopath, he does display the characteristics of a narcissist. As a result, this bias permeates all of his posts - self absorbed, self obsession.

I note, also, that Col has yet to veto middle class welfare and white collar crime. Perhaps, even Col recognises the hypocrisy if he did so
Posted by Scout, Tuesday, 13 June 2006 11:17:45 AM
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Scout
----"1.¨YOU¨ARE¨COMPARING¨APPLES¨WITH¨ORANGES¨BY¨TRYING¨TO¨CLAIM
NEGATIVE¨GEARING¨IS¨JUST¨LIKE¨BUYING¨SHARES.¨NEGATIVE¨GEARING¨IS¨A
MANIPULATION¨OF¨THE¨SYSTEM.¨DELIBERATELY¨SETTING¨UP¨A¨LOSS¨TO¨MAKE
A¨CLAIM¨ON¨TAX.¨IT¨IS¨A¨LOOPHOLE¨THAT¨SHOULD¨BE¨CLOSED."

By¨negatively¨gearing,¨you¨are¨paying¨less¨tax¨because¨you¨are¨EARNING¨LESS.¨It¨is¨not¨a
loophole.¨Why¨should¨you¨pay¨tax¨on¨income¨you¨aren't¨earning?

tao
----"NO¨TAXES¨AND¨NO¨STATE¨WOULD¨MEAN¨NO¨POLICE¨¨¨THE¨WEALTHY¨WOULD
BE¨VERY¨VULNERABLE¨INDEED."

I¨don't¨know¨how¨you¨arrived¨at¨that¨conclusion.¨Somalia¨has¨no¨government¨and¨is¨an
uncivilised¨country,¨and¨even¨it¨recognises¨private¨property¨and¨has¨security.¨What¨makes¨you
believe¨a¨civilised¨people¨would¨not¨have¨ANY¨form¨of¨security¨or¨private¨property?¨There¨is
also¨no¨world¨government¨-¨each¨nation¨is¨sovereign.¨According¨to¨you,¨all¨the¨poor
countries¨should¨be¨invading¨wealth¨centres¨-¨not¨just¨the¨US,¨but¨smaller¨nations¨like
Singapore,¨UAE,¨Norway,¨Luxembourg¨etc.

The¨only¨difference¨is¨that¨sovereignty¨is¨being¨brought¨down¨to¨a¨smaller¨unit¨-¨the¨individual.

I¨could¨also¨say¨that¨if¨anything¨WOULD¨infringe¨the¨right¨to¨private¨property,¨it¨would¨be
democracy,¨but¨even¨democracy¨respects¨private¨property¨to¨some¨extent,¨and¨that¨says¨a¨lot.¨As
far¨as¨unequal¨accumulation¨of¨wealth¨is¨concerned,¨a¨system¨where¨everyone¨has¨equal¨power
and¨could¨redistribute¨everyone's¨wealth¨with¨the¨tick¨of¨a¨vote¨should¨theoretically¨be¨quite
problematic.

Regardless,¨wealth¨redistribution¨is¨wealth¨redistribution,¨and¨it¨is¨unethical.

----"WE¨SHOULD¨CONSIDER¨WHAT¨YOU¨MEAN¨BY¨PEACEFULLY¨ACQUIRED
PROPERTY.¨IN¨THIS¨COUNTRY¨IN¨PARTICULAR,¨AND¨IN¨MOST¨OTHER¨COUNTRIES,
THE¨TRANSITION¨TO¨PRIVATE¨PROPERTY¨WAS¨ANYTHING¨BUT¨PEACEFUL¨AND
DID¨IN¨FACT¨REQUIRE¨GREAT¨COERCION¨–¨VIOLENT¨COERCION.¨NOT¨ONLY¨THAT,
IT¨DENIED¨THE¨“NATURAL¨RIGHT¨TO¨FREEDOM¨AND¨PROPERTY”¨FOR¨THE
ORIGINAL¨INHABITANTS¨OF¨THIS¨LAND.¨NOT¨ONLY¨THAT,¨IT¨DENIED¨MANY¨OF
THEM¨THEIR¨RIGHT¨TO¨LIFE.¨THAT¨REDISTRIBUTION¨OF¨WEALTH¨WAS
COMPLETELY¨UNETHICAL,¨AND¨JUSTIFIED¨BY¨AN¨IDEALISTIC¨SUBJECTIVE
FANTASY¨IMPOSED¨ON¨OTHERS."

I¨don't¨disagree¨with¨you¨about¨that,¨but¨what¨happened¨200¨years¨ago¨is¨irrelevant.¨How¨far
back¨do¨you¨want¨to¨go?¨What¨about¨countries¨that¨were¨annexed¨by¨the¨Roman¨empire?
Neither¨the¨aboriginals¨whose¨property¨rights¨were¨violated¨nor¨those¨who¨violated¨their¨rights
are¨alive¨today.¨It¨is¨ridiculous¨to¨try¨and¨designate¨responsibility¨to¨people¨alive¨today¨for
something¨that¨happened¨centuries¨ago.¨Besides,¨it¨isn't¨unethical¨to¨trade¨something¨that¨was
previously¨unethically¨acquired.

----"FIRSTLY,¨WHO¨IS¨DECIDING¨THAT¨“FRUITS¨OF¨OUR¨LABOUR”¨DO¨NOT¨BELONG
TO¨“SOCIETY¨AS¨A¨WHOLE?¨IS¨THAT¨JUST¨YOUR¨OPINION,¨OR¨IS¨IT¨A¨FACT?¨IF
THE¨MAJORITY¨DECIDE¨THAT¨THE¨FRUITS¨OF¨THEIR¨LABOUR¨DO¨BELONG¨TO
SOCIETY¨AS¨A¨WHOLE,¨WHAT¨IS¨THE¨FACT?"

A¨person¨owns¨their¨body¨(because¨they¨are¨their¨body)¨and¨therefore¨their¨own¨actions/labour.
The¨"fruits¨of¨one's¨labour"¨is¨the¨sum¨of¨their¨labour,¨and¨therefore¨IS¨their¨labour.¨For¨anyone
else¨to¨claim¨ownership¨of¨this¨labour¨without¨the¨permission¨of¨the¨labourer¨is¨enslavement,
and¨violates¨the¨nature¨of¨the¨relationship¨between¨the¨individual¨and¨their¨body.

----"IF¨“NEITHER¨YOU¨NOR¨ANYBODY¨ELSE¨IS¨ENTITLED¨TO¨THE¨WEALTH
CREATED¨BY¨ANOTHER”¨AND¨“THE¨"FRUITS¨OF¨OUR¨LABOUR"¨BELONG¨TO
WHICHEVER¨INDIVIDUALS¨LABOURED¨TO¨OBTAIN¨THEM”,¨WHY¨IS¨IT¨THAT¨5%
OF¨PEOPLE¨OWN¨95%¨OF¨THE¨WEALTH?¨5%¨OF¨PEOPLE¨SURELY¨CAN’T¨HAVE
DONE¨ENOUGH¨LABOUR¨TO¨PRODUCE¨95%¨OF¨THE¨WEALTH.¨OF¨COURSE,¨YOU
SAID¨“OBTAIN”¨NOT¨“PRODUCE”.¨THERE¨IS¨PROBABLY¨A¨DISTINCTION.¨ANYWAY,
I’LL¨BE¨INTERESTED¨TO¨READ¨YOUR¨EXPLANATION."

Don't¨assume¨the¨phrase¨"the¨"fruits¨of¨our¨labour"¨belong¨to¨whichever¨individuals¨laboured¨to
obtain¨them"¨solely¨defines¨what¨ethical¨wealth¨accumulation¨is.¨After¨all,¨people¨can¨receive
gifts¨or¨win¨large¨amounts¨of¨wealth.¨It¨also¨does¨not¨specify¨any¨AMOUNT¨of¨labour,¨which
you¨seem¨to¨have¨assumed¨it¨does.¨The¨reason¨only¨a¨small¨portion¨of¨the¨population¨who¨have
earned¨so¨much¨more¨wealth¨than¨everyone¨else¨has¨been¨able¨to¨do¨so¨is¨the¨same¨reason¨that
there¨are¨so¨few¨people¨who¨can¨bench¨press¨over¨1000lbs,¨or¨sprint¨100m¨in¨under¨10¨seconds:
people¨are¨different,¨and¨some¨are¨better¨than¨others¨at¨certain¨things.¨In¨this¨case,¨the¨game
happens¨to¨be¨meeting¨people's¨demands.¨A¨person¨does¨not¨earn¨commonly¨recognised¨wealth
by¨creating¨something¨that¨nobody¨wants,¨regardless¨of¨how¨hard¨they¨work.¨In¨fact¨a¨person
could¨spend¨almost¨no¨effort¨at¨all¨and¨earn¨an¨enourmous¨amount¨of¨wealth,¨just¨by¨supplying
a¨product¨that¨people¨want.

Free¨market¨capitalism¨also¨allows¨people¨to¨use¨their¨wealth¨to¨create¨more¨wealth¨-¨just¨like
machinery¨helps¨us¨build¨structures¨that¨are¨larger¨and¨take¨less¨time¨to¨build¨than¨they¨do¨with
our¨bare¨hands.

Redistribution¨of¨wealth¨is¨based¨solely¨on¨envy.¨People¨may¨believe¨that¨services¨such¨as
education,¨healthcare,¨and¨electricity¨are¨"rights",¨but¨these¨things¨never¨existed¨200¨years¨ago,
and¨humans¨have¨been¨around¨for¨how¨many¨years?¨How¨can¨they¨possibly¨be¨natural¨rights,
especially¨when¨someone¨else¨is¨required¨to¨provide¨them?

You¨also¨claim¨"we"¨shouldn't¨be¨paying¨sportspeople¨exorbitant¨amounts,¨but¨exactly¨who¨is
this¨so¨detrimental¨to?¨Is¨a¨person¨starving¨BECAUSE¨a¨sportsperson¨was¨paid¨a¨large¨amount?
Who¨was¨coerced¨when¨a¨sportsperson¨was¨paid¨a¨large¨amount?¨When¨someone¨comes¨up¨to
you¨and¨points¨a¨gun¨in¨your¨face¨and¨says¨"Tiger¨Woods¨collection¨agency.¨Give¨me¨your
money¨or¨else!",¨then¨you¨can¨complain.

You¨need¨to¨keep¨in¨mind¨that¨when¨a¨sportsperson¨or¨someone¨else¨is¨paid¨a¨large¨amount¨of
wealth¨for¨business¨purposes,¨it¨is¨an¨exchange,¨not¨a¨transfer.¨Wealth¨is¨not¨"lost"¨to¨the¨person.
When¨such¨a¨person¨is¨paid¨a¨large¨amount¨of¨money¨for¨business¨purposes,¨they¨will¨give
something¨in¨return.¨In¨such¨a¨case,¨the¨person¨CREATED¨some¨wealth,¨then¨exchanged¨it¨for
a¨form¨of¨currency.
Posted by G T, Tuesday, 13 June 2006 2:19:18 PM
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Good post Scout!

Ah Col,

Again, no attempt to explain your mythical “opportunity for equality”.

Of course I wouldn’t expect you find what I think relevant, nor the millions of people all over the world who are forced to live the reality of poverty, disease and war because of the ideology you adhere to. No need to follow any accepted principals of evidence or support for a conclusion. As long as you can rationalize your delusions in your own mind, that is all that matters.

As your little mate Johnny’s best friend W. says – some people live in the reality based community, while others – such as you, him and little Johnny, live in the faith based community.

And again, forced to come up with some more puerile nonsense about me being one and the same as Tristan. As I have said before, I fundamentally disagree with Tristan.

It should also be noted that making criticisms of what you perceive to be my “quest” in no way supports your own argument. Another diversionary tactic.

You said: “FACT---Everything-which-I-promote-diametrically-opposes-the-notions-of-Divine-Right-of-Kings-and-stands-squarely-against-all-forms-of-religious-or-authoritarian-social-orders.”

Considering your refusal (or inability) to base your own ideology on any sound evidence or premise, that ideology cannot be considered anything but a religious belief in the mythical God “market” with “rule of law” being the equivalent of the 10 Commandments, and the state being the equivalent of the Church.

Your own little mate Johnny even tells us that our laws are based on the good book. W. thinks God tells him how to run the U.S.

Captialism, which was once a progressive force, must now return to reactionary mythology to support itself as is evidenced by the rise of the religious right – the most backward section of society. The next thing to come will be facsim – if it has not already begun to assert itself in the U.S.

You can accuse me of being anything under the sun if you like Col, but none of it changes the sad, sad fact that your whole life is based on a lie. Enjoy!
Posted by tao, Tuesday, 13 June 2006 8:40:51 PM
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tristan, "You can accuse me of being anything under the sun if you like Col, but none of it changes the sad, sad fact that your whole life is based on a lie. Enjoy! "

The shame of all this is, you just do not get it, Tristan.

Pontificating around like some high priest of socialism is as old hat and rancid as Beazley's beer gut.

Thinking that anyone would take you "seriously" is pure delusion.

You do not have the courage to stand behind your views, if you did, you would go to the public in an election with them instead of playing "dress-up emperor" in your own private little world.

As for "sad". I am the one who is laughing all the way to the bank on what you suggest is a "lie" .

I am the one who is suggesting anyone else can do as I do and make themselves financially independent so they do not have to kowtow to some tosser of a non-thinker.

Conversely, what do you offer? High taxes and servitude to the State. HArdly original, no new ideas, no inspiration, just the dead hand of bureaucratic levellers.

If I ever met you I will happily drop a five dollar bill in the gutter, just to watch to see how fast you roll over to pick it up.

I suggest you "Enjoy" - if you have not run away again already.
Posted by Col Rouge, Tuesday, 13 June 2006 9:27:03 PM
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Col,

You are becoming hysterical. I’m sure the veins must be popping out of the side of your head.

You’re still carrying on about this Tristan/Tao crap. You have obviously lost all self-respect.

And finally the truth – all you are interested in is the money – that is how you measure your worth, and that of others. All the pretense of personal development out the window. In the end, all the venomous contempt for others that you so readily display only serves to demonstrate to us all how much you actually hate yourself.

G T – that was the biggest load of internally contradicted rubbish – even bigger than Col’s. You can’t even understand what I have written – or probably even what you yourself have written.
Posted by tao, Tuesday, 13 June 2006 9:53:30 PM
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Tao/Tristan “You are becoming hysterical. I’m sure the veins must be popping out of the side of your head.’

Oh pleased that from your dull environs, you at least see the emotion. Passion is a great motivator, you could do with some instead of the blandness and sterility demanded from bureaucratic levelling - but throbbing veins – hardly.

“Self-Respect” it is your own lack of it which blinds you from seeing it in others. Mine is very healthy and reinforced by the numbers of friends in my address book and the love I receive from my partner and daughters (as well as those aforementioned friends).

“all you are interested in is the money” Wrong, plenty of things interest me, freedom of choice and expression most of all. Without freedom of choice we are mere drones of the state, which is where you would place us, all subjugated by your “collective”.

Then of course the arts interest me, Mozart, Canaletto, Cellini being among my favourites. Florence, being the City I would most like to return to (I just love the Uffizi – and would be surprised if you have even heard of it).

Oh, money does interest me, not for its own sake but for the security and comforts it buys.

Finally “hate myself”?

Only the smallest of small minded tosser’s would suggest such a thing.

What you read and glean of me from these few words on this website are but a microcosm of who I am, what I do and what interests me, the entirety of which would be, clearly, beyond you.

GT keep up the pace, little tristan (and his non-de-plume, tao) is in retreat, it is only his foolish arrogance which is keeping him here.

Scout – whatever! When you get around to understanding basic economic, accounting and taxation principles, you might understand what I was talking about. Until then, your home-spun theories on Negative Gearing are strictly for the small minded wannabes who live in envy of those who have the courage to get off their butts and put their money where their mouths are.
Posted by Col Rouge, Wednesday, 14 June 2006 1:54:57 PM
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G T

You wrote: I¨don't¨disagree¨with¨you¨about¨that,¨but¨what¨happened¨200¨years¨ago¨is¨irrelevant.¨How¨far
back¨do¨you¨want¨to¨go?¨What¨about¨countries¨that¨were¨annexed¨by¨the¨Roman¨empire?
Neither¨the¨aboriginals¨whose¨property¨rights¨were¨violated¨nor¨those¨who¨violated¨their¨rights
are¨alive¨today.¨It¨is¨ridiculous¨to¨try¨and¨designate¨responsibility¨to¨people¨alive¨today¨for
something¨that¨happened¨centuries¨ago.¨Besides,¨it¨isn't¨unethical¨to¨trade¨something¨that¨was
previously¨unethically¨acquired

What convenient date would you like history to start at? As is typical of your ilk, you like to deny or ignore parts of history that don’t suit your own argument as though some aliens just came down to earth and plonked the human race, and everything it has built here yesterday. Human beings, and human progress, don’t exist in a vacuum. Everything we have and are today is a result of what happened yesterday, 100 years ago, or 30,000 years ago.

What happened 200 years ago is relevant, because if it hadn’t happened, you probably wouldn’t be here.

Haven’t you ever heard of the crime of receiving stolen goods?

You’re the one that said forced redistribution of wealth is unethical, and now you want to say the forced redistribution of wealth that happened 200 years ago is irrelevant. You can’t have it both ways. We can “unethically” and forcefully redistribute the wealth that exists now which would raise a hue and cry amongst your lot, but in 200 years we can say it is irrelevant – so I say we should start tomorrow.

The fact is that people who own the land which was originally unethically and forcefully appropriated, deny others who are equally entitled to the use of that land (by virtue of being human) off the land, and only allow them back on to “produce wealth” for the landowner for payment of wages - because otherwise they would starve. Not long ago it was called serfdom or slavery.

The state exists to police this. If there were no taxes, there would be no “public” police force, and wealthy people would have to pay a private police force – if they didn’t, why would would-be police, protect the interests of a minority?

Cont...
Posted by tao, Wednesday, 14 June 2006 10:43:02 PM
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With regard to the rest of your post which is equally as ridiculous as what I have exposed above, I suggest you go back and read what I have written.

People can’t win lotteries without someone creating the wealth to win. Sportspeople can’t do what they do professionally, without the support of a multitude of people. “Wealth” can only be made by humans transforming raw materials into something useful.

You people always use sporting analogies to make your point. There is a huge difference between sport and economics, because if you lose at sport (or fail to lift 1000lbs or sprint the 100m) you don’t starve. The same can’t be said for those who lose at economics.

I’m not even going to bother dealing with the rest of your ridiculous contradictions – it is absolute trash.

My, my, my Col,

Something we have in common. Florence is my favourite city.

I'll be on holidays for the next few weeks so I won't have the pleasure of witnessing your witty reparte, or the holes you dig for yourself. What a shame.
Posted by tao, Wednesday, 14 June 2006 10:48:17 PM
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GT Don’t worry about Tristan/tao, under his regime of delusional power, “property is theft”, except for what he and other unelected members of the central committee own. Typical hypocrisy of the despotic socialist.

I make money by saving other people money, where do you get the idea that I should distribute my “wealth” on some scale determined by Tristan/tao because you see it as “socially desirable” whilst I see it as “pandering to the indolent”?
Finally, the “need” I would have to dig a hole would only be to come down to your level.

As it is I prefer to assume you can hear the wisdom of my words from that pit which you would seek to drag the rest of us into.

As for your holiday, enjoy. Is it really a “holiday” or maybe you are “between jobs”?

Oh and re your absence, I am indifferent to your presence or absence, the only difference is, when you are not here, "air" fills the vacuum.
Posted by Col Rouge, Thursday, 15 June 2006 1:34:20 PM
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The real quest of emontional prodding is:
IN 1947, Austrian economist Ludwig von Mises published a short book entitled Planned Chaos. He analyzed and put into perspective the intellectual and ideological forces that had been at work in the Western world since the First World War and which had led to the Second World War.

He pointed out that it was “important to realize that Fascism and Nazism were socialist dictatorships” and that both had been “committed to the Soviet principle of dictatorship and violent oppression of dissenters.” He reminded his readers that before the First World War, Benito Mussolini had been one of the leading socialists in Italy. His major heresy from Marxian orthodoxy had been his strong endorsement of Italian entry into World War I on the Allied side as a means to “liberate” Italian-speaking areas under Austrian control in the Alps.

When the war ended, Mussolini organized the Fascist movement, unifying Italian nationalists, economic collectivists, and various groups from all walks of life that had come to reject traditional Marxian socialism. Mussolini took his economic agenda from the philosophy of syndicalism, the idea that trades, crafts, professions, and industries would be grouped into mandatory cartels and unions through which the nation's economic system would be planned and directed under government supervision and control. Mises pointed out that fascism “began with a split in the ranks of Marxian socialism.... Its economic program was borrowed from German non-Marxian socialism” and that “its conduct of government affairs was a replica of Lenin's dictatorship.” Mises also argued that the philosophy of Nazism was “the purest and most consistent manifestation of the anticapitalistic and socialistic spirit of our age.” Indeed.Now who do we know that has posted here; who fits that category and never under estimate the power of the great Aussi B S detector. We Know.
Posted by All-, Friday, 7 July 2006 8:20:48 PM
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Fascist dictatorship, characterised by the forced union of classes under the dictatorship of an authoritarian, nationalistic Party, in alliance with the national bourgeoisie, has nothing to do with 'The Dictatorship of the Proletariat' imagined by Marx. Marx's idea comprised the notion of a dictatorship of one class over another: of the majority over the minority. Under Lenin, this became the dictatorship of a Party as the representative of this majority (and hence the whole idea was skewed. As imagined by Marx, however, the idea of majority rule was not incompatible with democracy as majority rule. Today, as Santiago Carillo understood in his book, 'Eurocommunism and the State', the very word 'dicatorship' has an unbearable connotation, and without knowledge of Marx's intentions, it is hard to disentangle the term from the experience of Stalinism.

Perhaps, if anything, the experience of class dictatorships in periods of revolutionary transition shows the importance of retaining liberal democratic institutions for purposes of stability. In Russia, for instance, the counter-revolution that overthrew Communism depended on a dictatorship of a corrupt 'White Stalinist' bureacracy creating a new bourgeois class 'out of thin air' by selling off state assets drastically under value. When the Russian parliament rebelled, it was faced with the brute force of the state.

In times where there is a vaccuum in the face of the collapse of old traditions and institutions, there is always the risk of extreme violence in the struggle for power. The consequences of such a violent struggle give good cause to support liberal democratic traditions as the framework for majority rule tempered by the securing of liberal rights of free speech, assembly etc for all. As a democratic socialist, I am not in favour of any kind of dictatorship that undermines basic liberal human rights. I do, however, maintain that it is important to distinguish between the Marxist concept of 'The Dictatorship of the Proletariat' (ie: one class wielding power of another in a period of revolution), as opposed to the experience of fascist dictatorship: which is of an entirely different order.
Posted by Tristan Ewins, Friday, 7 July 2006 9:11:49 PM
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*previous post continued*

It is also important to remember that amongst the ranks of socialists and Marxists were those such as Carillo, Kautsky and Bernstein - who always demonstrated a healthy respect for democratic instutitons, rights and processes. These thinkers openly contested the Leninist interpretation of class dictatorship which, as Rosa Luxemburg recognised, became morphed into the dictatorship of the ruling party, and threatened to become the bureaucratic dictatorship of the executive.

What is happening here, in this thread, is an attempt to create a false association between democratic socialism and fascism: and it is an attempt that bears little relation to reality. Socialism has always been a pluralistic traditions - and it is true that there are authoritarians who claim the mantle of socialist traditions. But it is also true that there are neo-liberals who supported Pinochet - and that Pinochet's government implemented neo-liberal policies. At the same time, there are those on the neo-liberal Right who are political as well as economic liberals, and who would reject such a dictatorship. I am not going to generalise about ALL on the economic Right supporting Pinochet style governments, and I would appreciate it if my opponents were more intellectually honest also: recognising that there has always been a strong democratic current in the broader Marxist and socialist movements.

Tristan
Posted by Tristan Ewins, Friday, 7 July 2006 9:12:50 PM
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In all seriousness, you need to take a long hard look at what you say and try applying some objectivity. No matter how hard you wish for it, you and I just can not eat rocks as a dietary intake for sustenance; no matter how much a bent mind wishes for it.
Study closer: Professor Ebeling is the Ludwig von Mises Professor of Economics at Hillsdale College, Hillsdale, Michigan, and serves as vice president of academic affairs for The Future of Freedom Foundation.
I hope you find great disappointment in your mentors, but hope some realistic home truths dispel the Ideological Hypothesizing of the nothingness.
Socialist democrats or not, Ego is the driving mechanism that leads to destruction. Regardless of good intentions.
Posted by All-, Tuesday, 11 July 2006 5:10:30 PM
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I haven't got a clue what you're talking about.
Posted by Tristan Ewins, Tuesday, 11 July 2006 5:24:17 PM
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