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The Forum > Article Comments > Rudd's war on the middle class > Comments

Rudd's war on the middle class : Comments

By Mirko Bagaric, published 27/1/2009

Low and middle income earners didnít break the economy and itís not up to them to fix it.

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The article is, on the whole, very good and timely.

I think all countries rich and poor have to act to reduce greenhouse gases. The world cannot afford to have hundreds of millions more people achieve first world living class standards.

In western countries, notwithstanding Mirgo's very pertinent point that those who did not cause the crisis should not be made to pay to fix it, it will still be necessary for most of us to find ways to live more materially modest lives. Removing the gross inefficiencies of the chaotic unplanned extreme 'free market' system will help.

As an example, when Malcolm Fraser abolished the Department of Urban and Regional Development (DURD), thereby sacrificing Whitlam's vision of effective urban development on the altar of 'free market' ideology, he made it practically inevitable that large amounts of money would have to be squandered on roads and freeways and that most families would need more than one car to simply cope.

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Mirgo is spot on about the idiocy of unemployed people having to pay taxes.

Tax scales should have been automatically indexed in line with the (true) increases in the cost of living. The fact that Whitlam thought that they should not was a serious mistake on his part (and one issue on which I did happen to agree with Malcolm Fraser).

If that had occurred then we would have avoided millions of gallons the ink wasted by newspapers over past decades over the supposed largess of politicians 'cutting' taxes, when most of the time they were simply handing back to the lowest paid only some of the tax increases caused by bracket creep
Posted by daggett, Tuesday, 27 January 2009 9:52:23 AM
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I agree completely with the sentiment expressed in the article. In particular,

"Moreover, imposing the same wage disciplines on rich and poor alike is a contemptible case of economic discrimination. Rich and poor come from vastly different starting points regarding their capacity to attain any degree of human flourishing."

is a point that is not made anywhere near enough in our political discourse.

The problem is that the politicians are a product of the system that put them into power. Giving a fairer deal to the ordinary populace would upset their applecarts. That's why the pollies are mostly all talk (to convince you to give them your vote) but no action (in order to largely maintain the status quo).

"It is mindless that any Australia living below the poverty line should be required to pay any tax, especially given that they are then subsidised by the welfare system. This is bureaucratic nonsense and socially and economically unjustified. Approximately 10 per cent of Australians are now living below the poverty line (currently at around $700 a week for a family of four). Hereís a question for the PM: what is one good reason for not increasing the tax free threshold to the poverty line?"

This makes lots of sense to me. Increasing the tax free threshold would definitely make things fairer and simpler for all in the tax system.
Posted by RobP, Tuesday, 27 January 2009 10:53:06 AM
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For the life of me, I can't work out how this guy got his qualifications! This simplicity of thinking displayed here is astonishing:

"Rich and poor come from vastly different starting points regarding their capacity to attain any degree of human flourishing"

Yes, of course! Because all rich people started rich, and all 'poor' people are doomed to stay 'poor', and never shall a rich person become poor and nor a poor person rich! No poor person could ever earn big dollars - that's unpossible! This must be why the author got his degrees - his stunning insight into the way our society works.

This statement was never true and shall never be. In our society, those who work hard and play their cards right can become 'rich'. This is one of the great things about our society, which seems to be completely missed by people like Bagaric who seem incapable of recognising that the 'poor' don't have to stay 'poor'.

"It is mindless that any Australia living below the poverty line should be required to pay any tax, especially given that they are then subsidised by the welfare system. This is bureaucratic nonsense and socially and economically unjustified."

This is about the only part of the article which makes any sense, but not for the reason that Bargaric is suggesting: In considering the broader tax system that occupies this country, we have an enormously inefficient system in which vast swathes of people pay taxes and then get the whole lot (or more) back. And the greatest beneficiaries of this are the middle class (an F for Bargaric on this point), most of whom have a net zero or negative tax burden.

Yes, lets fix the tax system (including increasing the tax free threshold), but not for the reasons that lunatics like Bargaric suggest.
Posted by BN, Tuesday, 27 January 2009 11:10:24 AM
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The financial burden imposed on the middle class in Australia is significant.

To coin a phrase .... "never in the fields of human endeavour, has so much tax been paid by so few, for the benifit of so many".....
Posted by DLJ, Tuesday, 27 January 2009 2:33:28 PM
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Rudd lost me many moons ago when he made the comment about the current situation by saying,' we are all in this together'
Well its like this, we are not all in iy together, politicians of all persuasions have their super safe as do all public servants. this thanks to the forsight of Costello and company who set up the future fund to ensure future super payments.
the average guy in the street is doing the best he can, hehas no control over the financial mogols who have created this mess.
So I suggest Rudd begins to do what he was elected for, to govern the country and not go travelling the world saying 'look at me, look at me, we have a plan'Well if you do where is it, because from my perspective you are the only one who knows it.
Posted by mad max, Tuesday, 27 January 2009 2:40:47 PM
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Some good points here - I thank the author... But as well we need to specify alternatives... (ie: specific reforms of the tax system - even beyond Labor's mandate - to compensate for collapsing Company Tax revenue)...The whole tax system needs to be restructured...

And there's also the matter of welfare...There are signs of progress,here, for Disability and Aged Pensioners... But it is reprehesible to allow the unemployed - and others such as students - to languish in poverty - for not fault of their own...

Further - I would like to see Rudd commit that he will not let any family be thrown 'onto the street'. This means fast-tracking community and public housing....

Meanwhile - as I argued in my last article on Telstra - fast-tracking fibre optic broadband infrastruture could see a new 'engine room' for jobs - and productivty over the longer term...
Posted by Tristan Ewins, Tuesday, 27 January 2009 4:17:05 PM
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