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The Forum > Article Comments > An agenda for Labor > Comments

An agenda for Labor : Comments

By Tristan Ewins, published 22/2/2007

Labor needs to build for the future rather than embracing a policy that relegates the movement to 'one step forward, two steps back'.

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May I suggest a radical answer to your question: 'Health and education are always strong areas for Labor but if Labor combines fiscal conservatism with an agenda of personal and corporate tax cuts, what room is there for Labor to live up to this reputation? Ideally, Labor ought to aim to provide additional grants to the states ...'

Rudd's Federal Labor team in the first term could solve the funding conundrum by vigorously expanding 'new federalism' to transfer local government, education, health, police and water under Australian Government laws using their constitutional powers. In the second term, transfer the rest of the states functions over and the annual savings will be massive. The $50 Billion annual savings estimated by economist Mark Drummond, will enable better funded, better quality services, new public infrastructure investment while also delivering tax cuts.
Posted by Quick response, Thursday, 22 February 2007 12:16:34 PM
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A very good survey. What sort of agenda should the ALP have so far as international relations is concerned? For instance the rise of China, the US "alliance", ballistic missile defence and so on. Personally, I would like to see some embrace of alternative security concepts such as common or co-operative security.
Posted by Markob, Thursday, 22 February 2007 2:41:33 PM
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Of course we have got people who are having difficulty with homes and lack of income under the current government. The problem is that with a return to the country being run by the unions and a Labor government with the agenda Tristan favours, we will see many more businesses unprofitable, leading to increased unemployment and a general run down of the economy.

Tristan favours the abolition or halving of dividend imputation, for example, which will put a significant dent in my income that relies on such credits to pay my tax.

In very short time I can see the $96b of government debt returning.

As for the IR reforms, we had such a system in WA. It was great.

Of course the taxpayer pays for infrastucture to set up the opportunity for business to establish and invest. That's where the employment comes from. One of the current problems with land development, for example, is that state governments force developers to pick up the infrastucture costs which are passed on to land purchasers, adding to the overall cost of housing.

But I encourage Tristan (or is it Tristen?) to keep up his writing. That will allow the public to get a feeling of what the country might look like under a Labor Government.
Posted by Sniggid, Thursday, 22 February 2007 4:18:09 PM
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Sniggid: I understand that one must be careful when adjusting Company Tax. Too low and you don't have the revenue to sustain infrastructure to maintain quality of life and economic competitiveness. Too high and you risk driving firms offshore. But compared with the US, our rates are low. The benefit of an infrastructure levy is that you can use some of the revenue to suppport high wage industry (which is good for all of us), while using the rest to provide infrastructure.

In the field of infrastructure I refer you to a previous article of mine: http://www.onlineopinion.com.au/view.asp?article=5252

"in the areas of electricity, gas, rail, road and water, there is underinvestment to the tune of almost $25 billion. This is without even considering the backlog of investment in schools, universities, hospitals, public housing and aged care facilities."

Even with an increase in revenue, it is impossible to provide the infrastructure we all need without incurring some government debt. The key is that investment in infrastructure adds to economic growth and the increase in revenue means that the debt can be serviced. If you eliminate debt by refusing to invest in infrastructure it may look good on the surface, but the result is reduced quality of life and competitiveness.

While eliminating/halving dividend imputation may impact on the income of someone such as yourself, 90% of shares are held by only 20% of Australians - 99% are held by the top 1%. http://www.wsws.org/articles/2002/nov2002/gap-n21.shtml

The increase in the social wage, therefore, would prove beneficial to the vast majority of Australians.

Sage: I appreciate your sentiments - I feel the same way about many of the policies embraced by Hawke and Keating - but unless a credible alternative party with a broad enough social base arises to challenge Labor it is still important for progressives to work within the ALP to have leverage on policy. Also: even if a new party of the Left did arise, progressive would still need to work within the ALP to encourage partnership between the two parties.

Tristan
Posted by Tristan Ewins, Thursday, 22 February 2007 5:25:50 PM
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Tristan, your ideas on changing the revenue base is a just bad policy. You attack the company tax and imputation reforms introduced by the Hawke Labor government even though company tax has become the largest growing segment of federal revenues.

The forward estimates of company tax show an increase of 12.6 % or $6.4 billion whereas income tax only increased by $810 million. The forward estimates put company tax at 25 % of total revenue as opposed to 23 % for the previous year.

There is enormous pressure on companies to pay their tax so shareholders can receive their imputations. Removing imputations will result in huge drops in dividends, more tax avoidance and many companies adopting the high debt model used by toll roads and the Qantas buyout. If the company tax collapses, so too does the federal budget, and Tristan’s wish list is off to the shredder.
See page 5-8 on the link.

http://www.budget.gov.au/2006-07/bp1/download/bp1_bst5.pdf
Posted by Rob88, Friday, 23 February 2007 9:01:13 AM
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It seems entirely appropriate for business to be prevailed upon to improve infrastructure. If a business needs a factory it pays for the land and equipment, pays council rates, etc. should businesses be exempt from all of this because they create jobs? The workers create wealth with their labour - should they be exempt from taxation? Furthermore, more employment means more taxpayers and more tax. If the taxpayers are paying more, why should they be the ones paying for infrastructure upgrades?

Labor needs to scrap or at least heavily modify the Work **oices legislation. David Uren revealed, in the Weekend 'strayan of Feb 17-18, that the government has directed the Office of Workplace Services not to perform statistical analysis on the AWAs lodged with it, making it impossible to demonstrate how it has adversely affected conditions, though he points out that all AWAs lodged had removed at least on award condition before analysis stopped last year. Clearly this situation needs reversing.

We thus have Business – 1; Workers – 0 and an unfulfilled need for improved infrastructure. We also have the potential for business being hit twice, which will make them very unhappy. Perhaps to the point of campaigning against Labor.

Now, if we weren’t paying for two wars in the middle east, there may be more money around for infrastructure. Refugee paranoia doesn’t come cheap either. Closing down the offshore prisons and dealing with the innocent inmates humanely might free up some money for infrastructure, too.

Don’t know about Medicare expansion, tho. Medicare Gold bombed spectacularly last election and people with healthcare cards can get very cheap (not dodgy-cheap) dental treatment anyway.

Tristan, you make a lot of good points – too many to cover in one 350 word reply. I will say tho, that workers need their right to strike restored. Such rights are fundamental to democracy and their erosion, coupled with the Work **oices legislation is downright sinister.
Posted by Mat, Friday, 23 February 2007 6:49:59 PM
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