Geoff Carmody,

I agree with all your points at the end of your article about the policies that should be on the table. I agree none should be excluded.

However, why didn't you include in your list, carbon pricing, renewable energy policies and the other carbon restraint policies? I understand these polices, in total, are costing about $20 billion per year, but are highly unlikely to deliver benefits (in terms of climate change or climate damages avoided) in either the short term or long term (ref. my submission to the Senate Committee on repeal of the Carbon Tax legislation, Submission No.2 here: http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Environment_and_Communications/Clean_Energy_Legislation/Submissions ).

Geoff, I suspect that much of the fall in recent times can be attributed to a decade and a half of falling productivity growth. Governments of both major parties do not seem to be serious about this rather vital indicator or perhaps even know what to do. Unfortunately, living off the proceeds of mining inflows for so long while our major competitors catch up is a recipe that can only deliver the situation you speak of. Growth in GDP will not correct this malaise. Productivity must improve as well.

Peter Lang, I understand why carbon pricing is included. We must look beyond the prism of simple carbon abatement. It is true that an Aussie only tax will have little effect. However, once the marginal cost of carbon derived power approaches that of renewables, investment in these emerging technologies will naturally ramp up. In these cases it is usually the one that is first to the market that turns out to be the winner. More investment by private industry should be encouraged.

‘Real’ GDP!!

What an extraordinary concept!

So there’s real GDP and there’s ?ordinary or perhaps unreal GDP ??

How on earth does ‘real’ GDP differ from whatever other form of GDP there might be?

Is it somehow a better measure of growth and/or prosperity?

Or is still just as fundamentally flawed?

I think it is pretty clear that it is still just as flawed as ?unreal GDP!

Crikey, when are we going to get it through our thick heads that we need a measure of wellbeing that is a whole lot more realistic and meaningful than GDP?

GDP includes all sorts of things which really should NOT come out on the positive side of the ledger, such as economic activity generated by smoking-related illness, or by floods and earthquakes, or by continuous population growth, all of which does NOTHING to improve the lot of the average citizen.

And even with all the stuff added to GDP which just simply should NOT be part of it, it is still faltering. So if we were to consider only the genuinely good part of it, it would indeed be very badly faltering.

< Growth-supporting reform should start now. >

Hells bells, what a totally WRONG solution!!

This is what we’ve always done! It has been tried to the nth degree and shown to be an abject FAILURE!

What we need is to carefully define the good growth and the bad growth and concentrate on improving the good stuff and minimising the bad stuff.

One thing that has always come out on the positive side of the ledger is population growth. Our very rapid pop growth generates enormous economic activity. But hey, it is almost entirely just a case of economic activity which duplicates all the needs for the growing population without doing much at all for the pre-existing population.

Population growth increases the demand for everything. This is seen in the eyes of the Geoff Carmody’s of the world as good thing. But it is JUST THE OPPOSITE!!

continued

What we desperately need is to slow the increase in the demand for everything right down, so that the supply side can catch up and start to generate some real improvements, instead of just battling to supply the same level of everything to ever-more people.

We need to be able to improve the quality of supply (of resources, goods, services and infrastructure), rather than spending all our efforts on increasing the quantity!

THIS is of FUNDAMENTAL importance.

So, a couple of the key points in the reform of failing national well-being and prosperity are:

1. Develop a meaningful indicator and get right away from the critically flawed GPD indicator and

2. Significantly and steadily REDUCE population growth so that we can balance supply and demand, instead of be forever chasing the tail of rapidly increasing demand.

We do need to grow, but in a sustainable way.
What we need are leaders with both courage of conviction and virtually unlimited future vision.
Future vision would allow us to use our own massive super funds to develop Australia, with nation building projects, that are created to earn a exponentially growing profit!
Making such investment by our super funds tax free, is a no brainer.
We not only get no tax when this money is invested offshore, but miss out on the huge nation building, income earning projects as well.
What we need is an inland shipping canal, that not only massively reduces the time and energy component, of shipping our goods to Asia, but provide a new source of usable totally reliable water.
We should build a fleet of nuclear powered roll on roll off submersible Ferries, built for the same purpose.
Being submersible will allow them to take full advantage of ocean currents, sail in all weather, and provide a comfortable armchair ride, where sea sickness is little more than a distant memory!
Bulk transfer, is still the most profitable enterprise, and removing most if not all nonessential handling, will only ever improve both outcomes.
And a dual lane canal, will allow lock gates to continually move the water around, carrying the freight carriers, in and out!
And ensure, continual flushing, meaning this water could be harvested to support agriculture and industry, in our formerly dead heart.
Meaning, we can grow, and support maybe as much as 100,000,000 people sustainablably, and economies of scale, that make many new industries and investment, eminently possible and practical.
Like rapid rail, which would link the Ferries, with their ultimate customers!
If Curtain or Chiefly were alive today, and proposed a Snowy mountain scheme, there'd be almost universal howls of derision, and people, (experts, who know all the reasons something can't be done,) screaming from the roof tops, DREAMERS, we can't afford it, it can't be done!
I rest my case.
Rhrosty.

Geoff, there is only one real reform we need to undertake, and now, and thats real tax reform.

We MUST find a way to raise additional taxes, without asking hard working Australians to dig deeper into their already strained pockets.

Which ever way you look at it, we are headed for a train wreck, the likes few of us alive today have ever seen, with mining coming off the boil, iro ore looking like its headed for a basket case scenario, as the best prices have been during the infrastructure building process, and now that production is about to start, the mining tax will most likely take any cream.

The other problem we face is the reality that we no longer have to funds to buy jobs, so tens of thousands will go, placing more strain on taxes, both from reduced collection and increased support payments.

It is my view that We must have a serious look at the pros and cons of a financial transaction tax. If not, why not?