Jason,

You mention the phrase "rent-seekers" quite a lot in your article and especially how such activity reduces productivity. However any criticism of the most obvious form of rent-seeking, where the phrase comes, is absent.

Assuming you know something about economics, would you care to enlighten those less well versed what would happen if there was a massive increase in land tax which was dovetailed with an equally massive reduction on taxes on the provision of goods and services?

Yes the-answer is to fix the states [PERMANTLY]
The states are-that extra burden killing us all
we are over-governed [and under represented]

The states are little more than a cash cow for big buisness and collusion ,it would do us well to recall the half a billion that beaty gave a certain magnesium firm a few years ago , by grant [gift], plus how howard kicked in another half a billion , [that just insured investors [and share-holder] returns

All-the oppressions the states have laid upon us ,drug laws for the poor , child protection[read supply] for the child molestors, the divisivness and competition to favour big-buisness with special protections [like mount-isa lead-levels ,and cheap electricity for smelters, like giving free forrests to gunns, like privatising our waters , electricity , and many-other deviant practices serving the party supporters from big-buisness ,like the chair-sniffers they all really are.

The states can go as-far as they like [by controling policing like in victoria ,for egsample [or abolishing the upper house in qld ,or by selling the railways in nsw ,the deal-making must be obvious to blind freddy ,just look at how after retirment , beaty now openly serves big-buisness [while our water/electricty prices have doubled]

We have federal govt and local councils, what use [service] is state level providing [environmental protection that protects poluters , education that dosnt educate, and roads in a shambles , that is tendered into huge govt contracted out sources ,the hospital dental farce alone high lights that it isnt working.

But i hear the whine commonwealth powers come from the states [wrong] they come via referendums[the power of the people to form govt]

[besides we dont have constitutional-law [we are under maritime juristiction, ask a lawyer] ,

The states are that useless straw to far [recall your gst is paying for them[who paid for it pre gst?[the ritch who used to pay death duties ?but now just get tax cuts

[r.i.p states ,you have transgressed that one step too far [read act 70 of 2002-Qld] if you doudt what i say]

Kennett's legacy to Victorians has been no Victorian on the public payroll has a secure job, their employment can disappear a the stroke of a pen.
The local council is staffed by compulsory part timers and town planners lurch from 3 month contract to 3 month contract leading to no continuity of planning decisions and less than fearless and forthright planning decisions.
Local council services for the less well off in the community are provided by part time staff so that programs for the elderly are haphazard.
Teachers can spend up to 10 years on contract applying for their job and 50 others in the area every 6 months.
Patients in private hospitals as well as public hospitals are in the tender care of nurses who were hired at the start of the shift who don't know their way around today's workplace.
Because we still have employer based superannuation schemes older workers are not able to find meaningful permanent work.

In short Kennett's reforms were a disaster for working women and state public servants in Victoria throwing them out of secure employment and forcing those who were retrenched to continue in casual work or face a poverty stricken old age.

I think the rent seekers are those leeches in the financial services sector.

Billie ,why should State Public servants be a priviledged elite?It is the tax payer in private enterprise who sustains them.

That said,you do make a good point about a private sector that wants to drive wages lower to feed the share market.The profits from the minerals boom is not being shared equitably.

It is the Globalised economy that is driving this and with energy now at a premium ,things will only get a lot tougher.

As someone who lived through the Kennett Government, I saw nothing but damage in education, even though it was carried out under the great god Reform:
Running a campaign of denigration against the teaching profession,
Using retrospective legislation to get out of legally enforceable contracts with the teaching profession,
Dumping almost 9,000 needed teachers,
Worsening the primary PTR from 15.8:1 in 1992 to 17.2:1 in 1999,
Worsening the secondary PTR from 10.8:1 in 1992 to 12.6:1 in 1999,
Increasing class sizes,
Increasing teaching loads,
Abolishing the time allowance pool,
Reducing elective choice,
Officially introducing outcomes-based education – not bad in itself in my view but very bad in the few of some,
Bringing jargon – ‘beginning’, ‘consolidating’, ‘established’ – for reports,
Abolishing history and geography in favour of the mess of SOSE,
Reducing the number of marks required to get an A in VCE English tasks between 1994 and 1996,
Putting large numbers of teachers on short-term contracts,
Putting principals on contracts to facilitate their supporting the Liberal attack on their colleagues in the classroom,
Removing teacher input from principal selection,
Changing principal section panels so that it was no longer required that the majority of members be local or that the majority have educational qualifications,
Increasing the power of principals to bully and victimise their staffs,
Introducing limited tenure promotion positions and bonuses for sycophants as command and control devices,
Introducing performance plans, annual reviews and all the mad jargon of the business world,
Bogging schools down in charters, triennial reviews, data-fests and the like,
Discriminating against teachers and other department employees on School Councils,
Destroying the advantages of economies of scale inherent in a system by making schools spend thousands of person-hours creating their own versions of key selection criteria, etc.,
Producing a ministerial order purporting to ban teachers from speaking out about education.
The only real reform was making VCE marking criteria more specific – not much to show for seven years of effort!

The Labor Government has been slowly rebuilding the education system after the liberals ‘reformed’ it out of existence.

The author says:
‘The states have been enjoying record revenues, which they could have used to build infrastructure, educate people, release land, build utilities, help improve the health of its citizens. Instead they have found it easier to cynically manipulate policy for the benefit of donors, while buying off interest groups, rent seekers and the favoured few Labor mates who have attached themselves to the party machine.’

Unsurprisingly, he gives no details. So I will supply a few of the ways in which the Victorian Labor Government has been using its time in office to improve education:
Improving the primary PTR from 17.2:1 in 1999 to 15.9:1 in 2006,
Improving the secondary PTR from 12.6:1 in 1999 to 11.9:1in 2006,
Improving the primary PTR from 18.1 in 1981 to 15.8 in 1992,
Improving the secondary PTR from 10.9 in 1981 to 10.8:1 in 1992,
Setting up the Victorian Institute of Teaching,
Restoring teacher representation to principal selection panels,
Providing VCAL as an alternative to VCE,
Dumping SOSE and restoring history and geography as traditional disciplines within the humanities,
Lifting the ban on teachers speaking out on education,
Instituting a high-standard reporting system across the state that provides parents with specific information on much their children have progressed each year,
Employing an additional 5,193 teachers between 1999 and 2006,
Staffing primary schools to allow a maximum class size of 21 pupils in prep to grade 2,
Investing $1.4 billion in capital spending on schools,
Committing to rebuild every school in the state, with a down-payment of $1.9 billion in the next four years,
Lifting the top teacher pay by $10,000.

Despite the last, which some may see as rewarding ‘Labor mates’, teacher salaries remain tens of thousands of dollars behind their levels of 33 years ago and the staffing of secondary schools is still worse than it was under Dick Hamer. This suggests that Labor does not reward its so-called ‘mates’ or ‘rent-seekers’ in the teacher unions, and I suspect that if anyone did a long-term study of public sector wages, the same would be apparent in other areas.

Arjay the federal government provides the Army, collects taxes and issues passports.

The state government educates your children, builds roads, runs commuter trains, provides water, built our electricity grid, built our gas grid, provides a police force and law courts to keep you safe.

State public servants traditionally trade off pay for security. Public servants have to be qualified for the jobs they perform unlike people in private industry who get the job because the boss likes them. Traditionally private industry pays better than state public service, so if the employee of a private enterprise is earning less than a state public servant then they should get another job.

Don't blame public servants for your poor pay!

No Billie.The real stats for NSW are thus as of 2yrs ago.NSW Govt collects $40 billion in revenue Of this $21 billion goes to employing public servants.Of this $21 billion $7 billion goes to bureaucrats.We often have one bureaucrat to 2 front line workers on $100,000.00 pa with supper,holiday pay,long service,flexidays,and often on inservice not producing.

We have hundreds on PS in NSW who are redundant ,can't be sacked that the Govt are waiting to retire or resign.We have plenty of nurses but they sit behind desks!NSW PS has 3 times the no claims of workers comp than private enterprise.Most of them are out on stress.How can you be stressed when you cannot be sacked?So the Govt response is to decrease the benefits for all and insurance premiums also do likewise.In terms of payouts they are decreased and people in real hardship suffer.80% of Union power is in the PS.Again ,why do you need unions in a system of socialised privelidge?They are no differnt from the multi-nationals whom they detest.

This is why NSW is stuffed.Prior the last election Michael Coster said that we had 30,000 too many bureaucrats.This is over $3billion pa.Over the span of this Govt this is $36 billion that could have been spent on infrastructure.Instead ,we pay a fortune for tolled roads,no health care and no real public service.The exact amount that Morris said that the Federal Govt was holding back in term of taxes.Instead of addressing the problems ,Morris did a s deal with the Unions.Hence the financial debacle we have today.

The reality is that the NSW has squandered the money.NSW is stuffed and now with the world econmy going pear shaped thus we are doublely stuffed.Time to face facts Billie.

Arjay: "Billie ,why should State Public servants be a priviledged elite?"

Because it's better for the state. The assurance of employment provide much greater value to the public servants than it costs the state, meaning the state will save in the long term. Employees will be more engaged in their work if they know they'll still be around when things go wrong.

"It is the tax payer in private enterprise who sustains them."

And it's the public service sector that creates the social and economic stability that enable the private enterprise to exist. It's a mutually beneficial relationship.

"How can you be stressed when you cannot be sacked?"

Perhaps they actually care about getting their job done. The most valuable and productive employees are the ones that fully engage their role and not see it as just a job to get money. Moving towards short term contracts and casual work will destroy any attachment employees have to their positions, resulting in lower morale and lower performance.

Insipid Desipis.You have to be joking .You call this present PS of NSW better for the State?This is the lowest ebb of pubic administration I've seen in my lifetime!It may be good for incompetent Public Servants,but it has sent our state broke.

If you have a piddling argument, back it up with some facts an then use real stats to at least discredit the reality that I've painted.

Your argument is as pathetic and impotent as the Carr/Iemma Govts have presided over the lasr 12yrs.Iemma has a 28% approval rating which probably equates with the number of incompetents beneath him!

Arjay you insult Despsis and your statistics are vague.

Why do you think that reducing the public service payroll will increase delivery of services? The bloated bureaucrats will doubtless slash departments of service providers then reward themselves with big fat bonuses for reducing the wage bill. Services will be provided by contractors who are hired through labour hire companies. The owners of the labour hire companies will make massive profits.

All you need to do is look at the bureaucrat Michael Coutts Trotter, a convicted drug abuser who heads the education department. He is a person whose criminal conviction renders him unfit to stand in front of class anywhere in the country who has the nerve to slash the bloated payroll of NSW teachers.

Would you say that university graduates with 7 years exemplary work history earning under $75000 are overpaid? ie teachers. Do you think nurses are overpaid? What about the overpaid railway staff? ferry crews? road making crews?

Of course half of the state government's revenue goes in salary, state governments provide services. And because the bureaucrats in Macquarie or is it Phillip St don't want to negotiate with every individual state employees are represented by unions.

Every post you write reinforces my view of you as a single 30 year old ethnic male accountant earning a poor salary.

Um, if MY memory serves me correctly, it was NOT a Fed OR State Labour Govt that abolished the apprenticeship training scheme, (thus creating the ground work for our labour shortages today) that stood Australia so well ever since it's inception.
I wonder too, exactly how many apprentices Mr Jason Falinski, employs in his manufacturing company of CareWell a provider of furniture and equipment to the health sector.
Not too, the recipients of his products, the Health sector, a sector that relies heavily on Federal and State Govts subsidisations.
Of course none of his article could be construed as self serving, or of having vested interests now could it ?
WOW, talk about the pot calling the kettle black ?
I also notice, the inflation mentioned in his article was evidant in Australia well BEFORE a Labour party was elected into Govt.
I also notice, the previous Govt held state Govts to ransome on many occasion, withholding rightful funds trying to coherce them into introducing federal policies, which at the end of the day, would NOT benefit the states, only the bearucrats in Canberra and their lobbiests.
My, my, what short memories some people have.