Income inequality? Some people get more money than others because they are smarter or work harder.

Cooperation among political parties? The next thing you know, you have one big party. Think China.

The more politicians are sidelined, the better.

It has been proven beyond any doubt that too much of a good thing is no good !
Capitalism would work great with a benevolent Dictator at the helm.
As things stand, exploitation reigns supreme & many who work hard get fleeced down to nothing & the parasites in society work like Hell to prevent decency from the Domino effect.
And, so the undemocratic tax system will continue.

When Adam Smith wrote "Wealth of Nations" he proposes that wealth is created in three ways: Capital, Labour or Rent.

At the time collective bargaining of labour was illegal and even though he had a distrust of guilds, master tradesman were restricted by law in how many people they could employ.

Certainly his ideas about trade lead to the rise in influence of the British Empire and as a result the United States.

What he did not envisage was a government making the decision to use both the public Capital (of natural resources) and Rent (from mining interests) to set up Sovereign Wealth Funds as Norway has done.

In Australia the mining lobby groups have been spreading the idea that increasing royalties will make Australia less competitive and the mines will be forced to shut.

Scare mongering at its finest.

Smith had a deep distrust of lobby groups or factions.

According to Smith, this would make Norway less competitive and as a result force buyers to look elsewhere for resources.

This has clearly not happened.

There are no longer any "new" lands left to colonise.

One of may favourite quotes from Smith is:

"The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion."

Capitalism? Yes, but not the extremely exploitive, servant master capitalism/slave wages servitude, preferred by callous and indifferent US Republicans, welded to idiotic ideological imperatives.

But rather cooperative capitalism, that as, vastly more productive co-ops, remained the only private enterprise, free market business model that survived the Great Depression largely intact. Even as giant multimillion enterprises went to the wall.

It's not logics rites that wanted to dismantle co-ops but giant corporations that simply could not compete! And so, they had their spit lickle, brown nosing, political lackeys do it for them.

We are now almost the single democracy that does not subsidise food production. Sure, co-ops needed a bit of a kick up the backside to get them to modernise and streamline their operations. And there should have been healthy and generous schemes to make that happen as best practice whole industries could follow!

Conservatives don't want co-ops because they harm their political masters, i.e., the big end of town.

Labor because they don't need union involvement and generally pay better wages and provide superior conditions.

We need something like a nuclear power party that isn't owned by the big end of town or the union bosses. To encourage the emergence of co-ops serving/supplying myriad niche markets the world over!

We need to get away from two-tiered capitalism that creates a shrinking cohort of haves and an expanding cohort of have nots! And return Australia to the egalitarian society that once was the envy of the world.

We know how to do it, we have the formula, that once made this nation a nation that enjoyed unprecedented post war prosperity and economic growth!
Alan B.

Capitalism can only work to its design when controlled by Flat Tax !

"We need to get away from two-tiered capitalism that creates a shrinking cohort of haves and an expanding cohort of have nots!"

Agree, if a society is to have some degree of egalitarianism, then unrestrained Capitalism is not the answer. A mixed economic system which embraces the best aspects of Capitalism, with its innovation of entrepreneurial skills creating wealth in society, tempered with the social justice benefits of Socialism, is the "ideal" in my view.

Some people get more money than others because they are smarter or work harder.
ttbn,
Some is the keyword here however, the people creating personal wealth by manipulation, exploitation and, above all greed, vastly outnumber those who become wealthy by merit or for want of a better description, decent means.
The Australian Billionaire Kerry Packer once stated that "one would have to be mad not to pay as little Tax as possible" or something to that effect. I agree. What I disagree with are the deliberate loopholes created for those with money to make more money and, for that we must blame the general public & the politicians they vote in.
Change to a Flat Tax, introduce a National Service & this Nation will bloom as it never has before ! Capitalism & the economy must be a symbiosis because left to its own, capitalism is Parasitism !

People with money either inherit it or have others earn it for them or run this or that scam/profit gouge.

As for working harder that may include shortening the two-hour luncheon to just an hour. Or having a staff meeting where the staff are told their jobs are on the line if the profit curve doesn't continue on the skyward trend.

There was a time when working harder improved your lot quite well and that was in the post war years when our government followed Keysean economic theory and when co-ops flourished.

And the three-bedroom home with the two-car garage quite common. Petrol for 3 cents a gallon/around four litres. Big comfortable cars that all but floated over our rough country roads.

Today we not only have to work harder and longer just to make ends meet but our wives are forced to also burn the midnight oil as well just to get by.

And if you're over 45, it's the economic scrap heap/early retirement. And madness as these latter years are your most productive. And the years where your experience makes you one of the company's best mentors. Capitalism was the answer but it not the version in vogue today.

But that which enabled our grandfathers to buy a three-bedroom house, a serviceable car and able to afford an annual holiday on a single wage.

And where you earned your own pocket money mowing lawns, doing a paper round, baby sitting or helping out with household chores.

We've come a long way, but most of it has been downhill since the late seventies as the conservatives undid all that we built up in the immediate post war era as we all paid our fair share of the common tax burden. Now is individualism and rat eat rat competition, tax avoidance and the death of cooperative effort that benefitted all of us.

Those were the days my friend, we thought they'd never end, yes, those where the days. La, la, la, la, La, la, la, yes, those were the days.
Alan B.

since the late seventies as the conservatives undid all that we built up in the immediate post war era
Alan B,
Are you absolutely sure about this ? From my observations Union demands undid most of it !
It all started with doing away with national Service & replacing it with the Peter Principle !

Indy,

The quicker we get a 'Seniors National Service' up and running, the better, get those lazy snouts out of the taxpayer trough, that's what I say, its time for shoulders to the wheel, for older folk like you. Surly you are up for a few hours each week of light duty working on your local road gang! A little work with pick and shovel never hurt no one! Are you up for it?

Are you up for it?
Paul1405,
I could be but doing it for the likes of you ain't worth me holding onto a shovel while you're holding onto one of your union mates whizzing one through your knuckles for him !

a shrinking cohort of haves and an expanding cohort of have nots!"
Paul1405,
I'd say that it'd be more apt to describe the situation as "an expanding cohort of getting too much for too little & a shrinking cohort of getting enough due to forced supporting the former" !
Think Peter Principle bureaudroids, think yourself !

Capitalism ain't what it used to be; that's the real problem.

In fact, with the Left and Big Business snuggling up to each other, we no long have Capitalism, we have Fascism.

Capitalism (that means true capitalism, referring to Ttbn's last remark, not the state-protectionism of corporations that we now have) could well be the answer for the economy - but why should ordinary people have to suffer that much for economy's sake?

Yes Yuyutsu, for some time the tax burden has shifted from the haves to the have nots. As John Howard's GST and fuel excise.

Relief from capital gains tax, the abolition of death duties and negative gearing on steroids.

What we need is genuine tax reform as root and branch reform. Our current tax system, one of the most complex in the world is broken and need to be jettisoned in its entirety.

Capital gains tax relief and depreciation allowances needs to end at a five-year period. Negative gearing needs to be exclusive to new housing and limited to five/ten years, to be ushered in over a three-year period.

A hard one when one knows how many politicians from both sides of the isle who have negatively geared rental properties.

But needs to be done so to force the cost of older properties down as they depreciate/come back on the market.

Finally, the only income tax we need is a flat tax of 15%. And collected via the banking sector as a transition tax? An increase in actual dollars recovered by the ATO of 1.5-2%

And policed by former tax accountants who follow the spending patterns of various income earners. And if successful in exposing tax cheats, a healthy bonus for them and property confiscation for the tax avoiding tax cheats.

An unavoidable flat tax of 15%, with a generous tax-free threshold, allows former tax compliance costs of around 7% averaged, to be returned to the bottom line. In effect means the individual tax costs in total, with tax compliance costs removed, comes in a around 8%.

Moreover, a flat tax as described would increase the actual dollars following to the ATO and end forever, bracket creep.

With the end result, avoiding our new tax more costly than simply paying it!

The GST could be increased to 12.5% then as the economy recovers via tax relief, 15%.

And that recovery guaranteed by the transition to nuclear energy as walk away safe MSR thorium/MSR nuclear waste burning MSR! And consequently, our transition to/becoming an energy exporting superpower.
Alan B.

Yuyutsu

Why do ordinary people have to suffer? Well, the main reason is because the people who could do anything about the situation, the politicians, won't do anything that doesn't suit them, and the "ordinary" people, the real bosses in a democracy, let them get away with it.

The people have allowed themselves to be enslaved to politicians; and these politicians are mainly lunatics enslaved, in turn, to corporates and international tyrants infesting the UN.

As well, our own government is more interested in having a ‘good relationship’ with a Communist dictatorship than it is with us.

Any county happy to deal with the biggest threat in the world is effed.

Indy,

Capitalism will work for YOU. When "Seniors National Services Pty Ltd", of which you will own a 0.0001% share, comes in you will be sub contracted, working in the GIG economy, earning 2 bucks an hour, delivering road repair services. Now I hear you say, "but I don't own a pick and Shovel", no problem we will sell you a small pick and shovel at a rather inflated price, which you can pay off with interest over time, sounds good so far ah." Then in time, say 50 years time, with hard work and thrifty savings you will be able to buy an even bigger pick and shovel and earn maybe $3 an hour. In no time, say in another 100 years you'll own the whole box and dice, employing your own 'Pick and Shovel' brigade, a win win for all. Great idea is Capitalism! Agree?

Dear Alan,

I can think of better ways to make tax fairer, but what has this to do with the topic of capitalism?

Yes, right now we don't even have capitalism, right now we have a socialist government support and protect big corporations, leaving little chance for small, unincorporated and informal enterprises which stand no chance in complying with government's red tape.

In order to allow a capitalistic level playing field, government must not even recognise companies and corporations, but treat every individual equally.

But even if we had true capitalism, I would not support it because it forces people to compete just for their survival, or become employees who must submit to the whims of their bosses even when they are disagreeable or even immoral. That's a stressful, joyless dog-eat-dog kind of existence, which I cannot condone.

Capitalism is a good system when the Govt works with it rather than rely on the crumbs from it !

The mentality of too many is that they see Capitalism as a means to get rich quick no matter what. A true capitalist aims to make money by providing goods or services that benefit others with the same mindset. As I have stated countless times, we can only progress in a symbiosis because, as is clearly evident now, parasitism is lurking constantly waiting for an opportunity to exploit Capitalism. This is what makes so many believe Capitalism is not the answer. Capitalism is constantly abused & exploited because it can easily be exploited because of Tax loopholes. A Flat tax system will cut such exploitation dramatically with huge benefits to society !