Cogent, credible, thoughtful, informative and well researched article.
Agree Malcolm!
So how do we create a generational fund and return true equity?
I mean, when I bought my very first home, I only had to find a little over 2 years worth of my take home pay.
Ditto the second and third.
Today's generations, may be looking at ten years worth of the average pay packet!
Rents in some cases, for something as modest as a cramped bed-sitter, may be more than the current single pension!
And landlords threaten to increase those rents if the nanny state nipple of negative gearing is removed.
We clearly need quite massive reform of the tax system, to first and foremost end now endemic and monumental tax avoidance.
The requisite reform would likely make the ATO, and most tax practitioners entirely redundant?
And this extremely powerful, pampered and often well to do group, will not go quietly into the night, but comeback with a misinformation barrage of biblical proportions, just so they can keep those well fed faces firmly fixed in the public taxpayers trough?
And given around 60% of us are economic illiterates, very few understand when the "clever" people are patently duping us or our highly convoluted mind-numbing system?
Well, we have constructed one of the most complex set of tax arrangements in history.
A forty thousand page tax act, with an alleged loophole per page?
As one visiting Republican Senator remarked on Q+A, "at some point complexity always becomes fraud."
We need an infrastructure roll-out!
We need tax reform that finally ends all avoidance and returns genuine fairness and equity!
And we need to return housing affordability, to more than a shrinking privileged few.
Genuine tax reform and a much larger roll-out of low cost public housing, would be a useful start in the right direction!
Rhrosty.

First people need to understand what Norway has done.

Norway's government used the money saved by not having to import oil, and the money charged for their natural resource, to buy replacement foreign assets, the income from which will support the Norwegian economy as and when the oil resource is exhausted.

A fund invested in domestic government bonds is a waste of effort in a country with a sovereign currency. If you doubt this read Professor Bill Mitchell's blog on the matter. Prior to privatisation we already, as a community, owned substantial assets valued at much more than the existing rather idiotic Future Fund.

Australia is paying for current consumption by exporting natural resource assets, such as coal and iron ore, and not charging enough for the rights to export those assets. We have already wasted the opportunities that Bass Strait oil would have allowed.

The Labor Party initially had the right attitude to raising funds from the mineral assets but the wrong attitude about what to do with the funds raised. Their fund raising effort was watered down after tax deductible advertising expenditure by miners to distort democratic action by Labor under Rudd and Swan. That is a tax advertising loophole that should be slammed shut.

The Coalitions attitude was, and still is, wrong on all counts and the Norway Fund shows why. Norway used natural assets to protect the country's future well being. No Australian Government has never attempted such a long view approach.

Australia will eventually pay dearly for our dependence on foreign capital inflow. NZ has already, prior to the era of Helen Clark, suffered the trauma of that experience.

Foyle, we have, according to some industry experts. Hydrocarbon reserves to our immediate north to rival or perhaps eclipse the entire Middle East?
Our Indigenous sweet light crude traditionally leaves the ground as a virtually ready to use sulphur free diesel, that needs only a little insitu chill filtering, to make ready to use in most diesel engines.
Moreover, most engines, diesel or petrol engines, will run quite happily on CNG, and produce around 40% less carbon emission as the first consequence.
And passing NG through a simple catalyst, converts it to liquid methanol, a substitute for petrol or Av-gas.
The fact that all refinery stages are virtually eliminated or unnecessary, means that the choice of ready to use Australian sourced fuel, further reduces total transport carbon emission by as much as 75%! Or, that portion of transport emission created exclusively in the refinery processes!
You'd think, if there were any genuine concern for the "reef", we'd be exploring and accessing the enormous natural wealth of much lower carbon alternatives, and the thousands of billions, we could likely access from it?
Early prospectors were led to their often huge oil discoveries, by something as basic as oil slicks! In creek water or after rain.
To date, we have literally hundreds of similar examples, or mystery oil slicks in our north eastern marine economic zone.
So what did our super intelligent and gifted pollies do?
Why lock it up for all time of course! Even as essential oil imports rose to 85% of our needs!
Arguably at the behest of some very powerful international multinationals, concerned only with protecting and enlarging the bottom line of an industry, already raking in over 4 trillions per!
Rhrosty.

Rhrosty,
I assume you are talking about free flowing oil off-shore under the GBR rather than the extensive "proven" unconventional oil produced from oil shale by pyrolysis, hydrogenation, or thermal dissolution. Shale has to be mined usually as the oil is locked up as the solid, kerogen.

All oil is a depleting fossil fuel that ultimately puts carbon dioxide into the environment.

I am a supporter of Thorium liquid salt reactors and the latest information I have is available at;
http://www.youtube.com/playlist?list=PLKfir74hxWhPsAXSrCy--ORaxxbXdWnXK

Thorium reserves are extensive and would last for thousands of generations. The proposed generating plants produce little waste and can be made designed to be fail safe. The current discussion is around how such plants could be mass produced, as on the Boeing production line, to make cheap power available everywhere in the world.

The points I made comparing the Norway situation to the Australian Future Fund are quite valid.

Good point Rhosty, of course the other take is that the Boomers are going to spend the inheritance and then blob on to the age pension. The post war generation don't like to be portrayed as selfish prats stuck in the 1960s and the majority of them aren't.

The simple fact is that most have not got enough super and they will live on and on.

Yes Foyle, free flowing sweet light crude and natural gas.
Why, we can be reasonably sure that the Townsville trough has 5 billion barrels, and maybe as much as fifteen.
Because we are reasonably sure of that trough, we could buy an off the shelf Platform, for around a billion.
A billion barrels of virtually ready to use diesel, would repay all outlays, with the remaining oil supporting outlays for say a further three platforms?
Which could then be sited on another very promising very much larger trough, just a little further out? And there are several other promising geological features worth looking at!
Traditionally, Australian sulphur free sweet light crude leaves the well head needing only a little insitu, chill filtering, to remove sand particles and soluble wax, that makes that black smoke and or, clogs the injectors on a cold and frosty morning.
The addition of around 4.7% methanol, also assists reducing the smoke, by producing a much cleaner total burn.
Many gas wells produce condensate, (LPG) and gas exiting, below zero.
The pipes may need a little warming to stop frozen condensate interrupting the flow.
This naturally occurring super cold flow, would serve to provide the chill, factor required in chill filtering any sweet light crude.
I'm also a fan of cheaper than coal Thorium, and things like rapid rail, which would negate much of the need for trucks, buses and planes.
Also agree with Cheryl, and her usual for her, pragmatism.
Rhrosty.