Call me a realist, but the problem I see with Tristan's ideas is that they're too idealistic. Not that idealism is bad mind you, but that it's far too easy to say, but much, much harder to do. Yeah, it would be good if all the suggestions were to happen as easily as they sound, but they won't. Experience tells me that for most people, anything that comes easily isn't worth having. Conversely, only those things society works hard for are what they'll value. And then, history has shown that society only does things when everything's on the verge of going pear-shaped (just look at how governments are madly scrambling at the moment, after decades of inertia, to implement water policies in response to the drought). That's why I think Tristan's ideas, as they are portrayed, just won't work at the current time.

While progressive taxation is a seductive idea for the Left, it doesn't work because it concentrates taxation on too narrow a part of society and the economy. It's better to gradually widen the base of taxation so that as many people as possible pay a fair share. (At least this plays to the psychology of society, where the people collectively believe they deserve the freedom to both make a go of things if they want and be taxed the same as their neighbour.)

Once done, the government can determine its welfare offsets so that those least able to look after themselves are helped out. As the world becomes more competitive, Australia is going to need all the nous, innovation and knowhow it can get to make the country overall a wealthier one. This isn't going to happen by wrapping the country in cotton wool as a result of ramping up the progressive taxation system. (As a matter of fact, even a flat tax regime is a progressive tax - just not as progressive as the one Tristan has in mind.) They don't say that 'politics is the art of the possible' and 'everything is political' for nothing. Putting those two truisms together, Tristan's ideas can't possibly work.

As to whether or not my ideas can work - they have worked in Sweden and the other Scandinavian countries, and they have worked in countries such as Denmark and Holland. It's true that the entire program might be too difficult to implement over one term: but I think that the Left ought be uncompromising - with the aim of framing and relativising the terms of debate. If only a couple of my proposals were adopted - even in ammended form (half-dividend imputation, carbon tax) - the surge in revenue would be enough to address waiting lists and pay for investment in education infrastructure.

The entire program might take several terms: but providing for quality and free aged care for all is a pressing problem that will only grow greater as the population continues to age. Some in the ALP are talking about investing Future Fund proceeds into infrastructure. This is a good idea - there is an enormous backlog in infrastructure provision - but some time or another we have to confront the fact that taxes will have to rise to pay for increasing health and aged care costs.

As for broadening the tax base - there is no doubt that those on middle incomes would need to meet a substantial proportion of the tax burden if we were to move in the direction of providing a European style of social wage. Howard won with a GST - and looks to be a good chance even promoting nuclear energy, and continuing Australian involvement in Iraq. NZ Labour, what is more, has won successive elections on a program of raising the top income tax rate, and re-establishing a public bank. This shows that it is possible to win elections on a platform of progressive tax reform.

The change might have to be incremental - even over a number of terms - but Labor isn't even proposing incremental reform - we're talking about effectively going backwards. One thing Labor cannot afford to do is make an opportunistic move for tax cuts: fueling inflation and narrowing the revenue base.

Of course we want the government to increase spending. In addition, most of us would also like the government to abolish all taxation.

Any deficiency in government financing could be covered from the sale of politicians assets.

“I think the World Bank and IMF need to be reformed so as to give third world countries control of their own destiny”

That is exactly like suggesting a bank is best managed by a bankrupt.

The reason the IMF and World Banks were conceived was to enable developing countries to themselves, develop responsible economic practices through having conditions and benchmarks attached to their borrowings, rather than continue with non-sustainable (often) socialist grandiosement programmes (aka pork barrel projects).

Dividend Imputation was introduced by Keating, in one of those rare moments of reason, although the practice is not universal.

DI removes the “double dipping” by the tax authorities, when comparing share dividend income versus interest income.
Simply put, an interest cost is a legitimate deductible tax cost for funds of the borrower and such incomes are assessable by the lender.

Dividend payments are paid from an after tax income stream (franked) by the company and without dividend imputation, that income would be taxed again upon receipt by the share holder.

Upon receipt of dividend the investor receives benefit of the tax already paid at the corporate rate, extended as a value, he can then offset this tax, already paid, against his own assessable income.

Infrastructure and services should be on a user pays basis, better I choose the quality standards for the infrastructure and services which are supplied rather than have some disinterested bureaucrat making such decisions for me.

It is like government businesses, they have, traditionally, only operated as monopolies, which destroys consumer choice and makes the consumer the victim of a commercial tyranny.

They require injections of under-scrutinised consumer tax funding, rather than being financed at arms length by investors taking risks with their own money (basic commercial accountability).

They presume to know what individuals need and want, which is the corrupting and contemptible presumption behind socialist political arrogance.

Sound government and politicians recognize that they are there to serve and not to master their electorates and certainly not to run commercial monopolies with unaccountable tax revenues.

re: the IMF, World Bank and the Third World - what does forcing third world nations to privatise their water and electricity supplies have to do with 'responsible economic practices'. And what value democracy in this scenario? What if most people what public ownership of gas, water, electricity, education - and structural adjustment packages - determined directly by the United States as the most significant contributor to the World Bank/IMF - DEMAND small government, privatisation etc? As was the case under Pinochet, the requirements of democracy take a back seat to the demands of the neo-liberal ideology.

As for dividend imputation - 90% of shares are owned by only 20% of the population - and 1% of the population hold 50% of all shares. What should we be giving tax breaks to these people while Howard 'cracks down' on single mothers and the disabled. It's not about the fairness or otherwise of 'double taxation'- it's about the INTERESTS of the wealthy - something both major parties play to with little concern for the fact that lower income Australians are paying proportionately more tax as a consequence. The trick is to make those on lower incomes believe that their interests are the same as those of the wealthy - unfortunately many succumb to the hegemonic ideology. In any case, company tax is so low that the amount of tax before dividends are paid is scandalously low in any case.

re: government monopolies - monopolies in infrastructure ought be accountable through the ballot box and the public sphere. In some cases, private infrastructure holders - take public transport in Victoria - attract massive public subsidies. (in Victoria over $500 million for Connex and Yarra Trams) Where are the 'private sector efficiencies' here? In the case of the Scoresby freeway - the project cost about 2.5 million - but will return $7 billion to investors before reverting to public ownership. Again - how do consumers benefit from 'user pays' here? Even the Liberals in Victoria were opposed to tolls on the Scoresby freeway - but Col is blinded by his ideology.

Tristan says: "Some in the ALP are talking about investing Future Fund proceeds into infrastructure. This is a good idea - there is an enormous backlog in infrastructure provision - but some time or another we have to confront the fact that taxes will have to rise to pay for increasing health and aged care costs."

This fundamentally assumes a Keynesian economic model where the state pays for everything out of taxes and taxes alone. But the great advantage of globalisation (there are plenty of disadvantages too) is that there are now lots of avenues to getting things done (such as building infrastructure and perhaps one day running education programs, etc) compared with the old days where the government controlled a captive, static society. What about industry super funds financing the building of infrastructure instead?

As to the comment that taxes will have to rise to pay for increasing costs, this is not necessarily so. Consider the following scenario: if an ambitious company were to see an opportunity to steal a march on its competitors by expeditiously building some infrastructure (say broadband, fibre optic cables, tollways, ports, etc), it might decide to do this itself rather than wait for the government to plod through its bureaucratic processes. This in turn takes the financial responsibility off the Commonwealth to fund the project, leaving it with a windfall to spend somewhere else. By business jumping in in this way, they effectively take some of the role - and the funding responsibility - away from government. Isn't this another way to skin the cat? The problem with the progressive tax regime propounded by Tristan is that it euthanases the goose (the positive economic effects of globalisation) before it can ever lay a golden egg (generate wealth creating businesses).

The Keynesian paradigm is an old one. The future will be a blending of state control and market forces, where the state steers the effects of the market. This means letting the market do what it does well, but according to rules set by government for the benefit of people in society.