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Day to Day Politics: Your corruption is worse than mine, and other taxing issues

Thursday March 31 2016

1 At the crux of the Senate stalemate over the ABCC legislation are two principles. Firstly the Government says the crossbench Senators, because some rorted the voting system, are unworthy participants. A DD will fix the problem it says. In itself that is debatable. Secondly the Government wants its ABCC anti-Union corruption bill passed.

The Senators suggest a compromise that would include all corruption. Not unreasonable you might say. After all corruption is knowingly rife in politics and business.

It is not unreasonable to suggest that corruption in the banking sector and its effect on ordinary people is far worse than that of unions in the building industry. And that corruption in politics is destroying our democracy.

Too unreasonably single out union corruption suggests you rate it worse than other corruption and leaves the Government open, particularly the Prime Minister, to further charges of hypocrisy. Union bashing in other words.

A recent survey by Essential Media found that most respondents opposed the reintroduction of the ABCC, and demonstrated that the Federal Government must be more active in countering misconceptions about the role and function of the construction watchdog.

It remains an open question as to whether the PM really wants a more democratic electoral system or if the ABCC is a more important matter than others that would seem more worthy of its attention.

If per chance the cross benches passed the bill, Turnbull would have some explaining to do as to what the real motive was.

The Essential survey on the following question:

What do you think is the main reason why the Prime Minister Malcolm Turnbull would call an early double dissolution election?

Showed that 14% thought it was because Parliament won’t restore the ABCC. 15% said it was because he wants to get rid of the independents in the Senate and 30% said it was because his Government is losing support and he will have a better chance of winning if the election is held early.

2 The Crickey Poll Bludger in the absence of any Polling over Easter reveals Newspolls quarterly breakdown. It shows the Turnbull Government sinking in Vic, and SA with Victoria leading the way. Another poll reveals that the government will have a hard time selling its budget. An internal poll also shows that Bronwyn Bishop wouldn’t hold her seat of MacKellar and the Nationals will almost certainly contest the seat of Murray. Sharman Stone’s former seat.

This week’s Essential Poll still has the parties 50/50.

3 Those interested in American politics should read this.

‘Justice Scalia’s seat is vacant. Ginsberg is 82 years old, Kennedy is 79, Breyer is 77, and Thomas is 67. Nowadays, the data shows that the average age of a Supreme Court retirement or death occurs after 75.

These are 5 vacancies that will likely come up over the next 4-8 years. The next President will have the power to potentially create a 7-2 Supreme Court skewed in their ideology.

Think about that… 7-2. If the next President appoints 5 young justices, it will guarantee control of the Supreme Court for an entire generation. And 7-2 decisions will hold up much more over time than 5-4 decisions which are seemed to be lacking in mandate’ – Colin Powell.

4 It seems Tony Abbott will run his own campaign in the forthcoming election.

He has expressed his readiness to participate in the 2016 federal election campaign to support colleagues who hold marginal seats. Senator Nick Xenophon said he would be delighted to have Abbott campaigning in South Australia. I suppose Christopher Pyne will also welcome him.

Nifty Nick knows when he is on a winner.

5 I know I’m always on about the NBN but when Australia slips to 60th position in world speed ratings it’s about time we all took notice. What a cock up this supposedly ‘innovatively’ minded Government has made of this medium.

It is just ridiculous that we are building a copper-based service that will be redundant in ten to 15 years. We should all question why we are heading down such an inferior pathway at such a huge cost.

6 How refreshing it was on Tuesday to watch Paul McClintock, a businessman and former staffer to John Howard deliver a speech ‘Deficit to balance: budget repair options’ for CEDA, the Committee for Economic Development of Australia minus the politics at The National Press Club.

‘No economic problem in Australia is graver than the persistence of large budget deficits,’ he said.

The research was conducted by a 12 member commission that included current Reserve Bank board member Dr John Edwards and three former secretaries of the federal department of Prime Minister and Cabinet, Dr Michael Keating, Dr Ian Watt and Terry Moran.

What struck me was the way in which McClintock demonstrated that when you dispassionately divorce yourself from the politics, and objectively address an economic problem, just how much clearer the answers are.

Contrary to the Abbott/Turnbull governments’ notion that budget repair can only be achieved with spending cuts, the report calls for revenue enhancement. It reckons that $15 billion in revenue ‘enhancement’ measures and $2 billion in spending cuts would bring the budget to surplus in 2018-19.

Now you wouldn’t call these committee members raging socialists but their preferences for revenue raising were suspiciously Laborish.

Singled out were superannuation tax and capital gains tax. Introducing a flat 15 per cent discount on super contributions ($6.9 billion), reducing the cap for concessionary contributions to super to $10,000 ($8.5 billion), halving the capital gains discount ($3.6 billion) and abolishing negative gearing on all assets purchased after December last year ($2.6 billion).

Other options proposed included increasing petrol taxes, cutting the fuel tax credit scheme, cutting industry tax concessions, clamping down on work related tax deductions and extending the ‘temporary’ the budget repair levy.

Without action, the commission found personal incomes would bear the rising burden of taxation.

It all sounds reasonable when you take the politics out of it.

Recommend you read this article by John Kelly on the subject.

An observation.

It seems to me that the wisest people I know are the ones that apply reason, and logic and leave room for doubt. The most unwise are the fools and fanatics who dont’.

7 My first reaction to the Prime Minister’s proposal to give the states the right to raise their own income tax is that the electorate will never buy it. Imagine the States with that sort of power. He is just handballing a problem he can’t handle.

Turnbull indicated that over time if a particular state had a problem it might say.

‘OK, we have got an issue with one part of our services. Can we fix it ourselves or do we need more money? If we need more money, then they go, the state would go to their parliament, raise the money, go to the people and persuade them of the merits of it.’

A hard sell this one. I wonder how long it will stay on the table. We might even see a perpetually shifting population seeking the least taxing state.

And didn’t Scott say:

‘This is not a government that has any interest in lifting the tax burden on Australians’.

Wouldn’t it be easier to just get companies to pay some tax and stop all the subsidies?

My thought for the day.

‘For the life of me I fail to understand how anyone could vote for a party who thinks the existing education and health systems are adequately funded and addresses the needs of the disadvantaged’

PS: I read last week that the actual plebiscite question that was supposed to be revealed prior to the election had been shelved. Yesterday I read that the plebiscite itself is to be shelved indefinitely. Can’t be true surely.

 

16 comments

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  1. Carol Taylor

    John, it never ceases to amaze me how much Morrison gives the impression of a startled rabbit in the headline should anyone dare mention the R for revenue word. But why continue with this Hockey-esque state of denial? The answer being quite clear, and this is because this government does not want to have to deal with the answer: yes Australia has a massive revenue problem, and no, charging pensioners $5.00 to visit the doctor isn’t going to fix it. The only place left to find money is with the people who have the vast majority of it. It seems that the Libs run screaming at the mere thought of this.

  2. Jaquix

    The oh so sensible CEDA report will of course be studiously ignored by Turnbull. His ‘big idea” on spliting income tax with the states to manage their own hospital spending, (and education too as he told Fran Kelly this morning) is totally ridiculous – and we see through it! Implementing CEDA recommendations would fix all, but the Libersls arent interested in fixing, just maintaining privilege.

  3. Terry2

    7. Since Federation the Commonwealth have fought tooth and nail in the High Court to ensure that the Commonwealth controls taxation and holds the national purse strings to divvy funding to the states as they see fit.

    The suggestion seems to be that individual states can now increase or lower an income tax surcharge for their own benefit. In the example given by the PM it may be that the Commonwealth will reduce income tax by 2% and allow the states to increase their surcharge by, say, 5%. So the net increase in income tax is three percent BUt it is not an increase from the Commonwealth government, it’s a state increase.

    So, Turnbull can genuinely say “my government have not increased income taxes” however, the pea & and thimble at all times remain the property of the Commonwealth.

    Mr Turnbull will also be making available a line in snake oil medicine to the states at COAG 🙂

  4. Matthew Oborne

    yes Carol, and this new measure of giving the states power to tax income wont help when rich people write off their taxes via negative gearing, the burden again will fall on those who cant afford it. Why should we pay for thousands of empty bachelor pads kept vacant and furnished in case some rich married white guy gets lucky.

  5. Terry2

    Also Matthew once the states have variable income tax rates as they inevitably will, those in business with the money to pay tax accountants will ensure that their earnings are all attributed to the state with the lowest tax.

    So, if Tasmania, for instance becomes the state with the lowest tax they can expect a surge in ‘residency’ ; a bit like Southern Ireland.

    A shambles in the making in my opinion.

  6. Deidre Zanker

    One hand doesn’t know what the other is doing. Confusion rules and lack of policy follows. Incompetence on a massive scale. Change of govt desperately needed for our society to survive.

  7. wam

    love xenophon pick a cause get the wowsers to elect you and get your pension and a bunch of houses. Despite SA being second behind the NT, in the pokies disaster stakes,he uses the cause to shift to the senate where he volunteers for every extra cash on offer and ignored the pokies when he had the balance in howard’s premiership slunk behind wilkie against gillard and bought some more houses.
    Loved the ‘pyne’ bit, the only positive of a xenophon is a candidate against the pynenut would have an excellent chance of winning.
    An americanisation of us that takes us back to the 30s.
    I can imagine tweed head and collangatta, albury wodonga workers who work one side and live the other???

  8. John

    Turnball is such an idiot. The Liberals may even stay in power if they took on Labor new intentions for Negative Gearing and Capital Gains Tax.Voters would feel a sigh relief that these idiots govern for all citizens.

  9. wam

    oops forgot to mention: when nickyboy gets in and qualifies for his pension, adds a few extra houses, he will retire to the next phase of his admirable life.
    Perhaps we saw a glimpse by his method of self advertisement?

  10. Matters Not

    Mitchell says:

    It generates its income from membership subscriptions (mainly to business), events (lunches, speakers etc) and donations etc. It has a long history of pushing a mainstream economics line and proposing policies that benefit business

    That’s pretty accurate although the ‘ideological’ line it runs does move around a little, depending in large part on who the leader is at any one time. In Queensland, when Labor was elected (after 32 years in the wilderness) the head was Ken Wiltshire and invitations to Labor Ministers came thick and fast. That was my first contact with them.

    Terry Moran who is a signatory to the current CEDA document spent most of his working life serving Labor Governments in Queensland, Victoria and then Rudd/Gillard in Canberra. I think he was a labor staffer many years ago. Certainly had strong Labor connections in his earlier years.

    As a political lobby group it doesn’t have much clout. Certainly it doesn’t come close to that of the IPA. ‘Bland’ is probably the best descriptor.

  11. David

    I find Xenophon’s Nice Guy with the permanent smile, only criticise nicely, Mr Inbetween, I like everyone…. sick and creepy

  12. jimhaz

    I garnered a strong distrust of Michael Keating when he was chairman of NSW IPART during which they allowed extraordinarily excessive electricity price rises each year. Sure the main fault was gold plating as approved by the Australian Energy Regulator (run by State Energy Minister’s), but Keating must have been aware a price gouging scam was in play. So much for the word Independent in the IPART title.

    “A roll call of recent NSW energy ministers reads like an ICAC subpoena list. In 2006 and 2007, as the states were writing the rules for the new regulator to enforce, NSW had two energy ministers: first the corrupt Joe Tripodi, then the corrupt Ian Macdonald. Macdonald disgraced himself in 2009 when, as the NSW networks were preparing to spend billions on new poles and wires, he accepted a night with a prostitute in return for setting up dinners between state energy executives and the infamous property developers Ron Medich and Lucky Gattellari. (Gattellari was later jailed for his part in the murder of Sydney standover man Michael McGurk.) In 2011, when the Coalition swept Labor from power, the new premier Barry O’Farrell awarded the energy portfolio to Chris Hartcher, who stayed in the job until ICAC came knocking in December last year”

  13. Jack Straw

    David: I agree with you with regards to Nick Xenophon. And, I’m going to go one step further and be racist. In my life experience it appears to me that Australian born Greek boys are spoilt rotten by their Mummy. Make of that; what you will?

  14. paul walter

    The US Supreme court is central to all else that has ocurred in the USA since the “Hanging Chad” election sixteen years, when that court exposed itself as politicised beyond redemption. The Supreme Court there has the final say on various laws and is loaded with conservative appointees from the Reagan and Bush eras. Monsanto, Gas Fracking, corruptions of electoral law, so many things have been countenanced.

    When I think of their Supreme court the best analogy I can come up with is the ABC Board.

  15. JeffJL

    Point 6. Even when being forced to answer politically loaded questions Mr McClintock was able to stay above politics. As you say very refreshing to hear a talk at the Press Club about policies without politics.

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