By R D Wood
Although we can hope for a more democratic economy through redistribution, we must also acknowledge our own personal role in being responsible citizens. As others have called for, we need taxes on multinational corporations; taxes on currency exchange markets; and taxes on those who inherit a golden goose sized nest egg. It is also about taxing what is negative, which might be carbon pollution or cigarettes or sugary drinks, and levelling these taxes against corporations with gross profits regardless of whether or not they pass that cost on to the consumer. In that way, the government, which means the people, can derive an income and encourage the betterment of society for all of us. This is what the focus of economic policy could be. It must lead towards non-violence in a broad definition and a good life as one of positive behavioural affirmation.
That we need to work smarter in order to live fulfilling lives means we need leadership that says it is OK to take a day off; it is OK not to lust after the latest consumer goods; it is OK to have a hobby. It is OK to realise that we are here for the long run. That this needs to go hand in hand with a service economy means we can combat climate change through economic means other than a simple tax on carbon. In other words, the greatest action we can take for saving the planet is providing economic conditions that support human labour, which is an inexhaustible resource. This is opposed to the commodity fetishism based on rare materials. Why should a massage be taxed at the same rate as a packet of chips when the former does not need plastic to exist? Like any other economic activity, they both are options for how we spend our time, but one costs less of the physical earth than the other. We need to think quite seriously about natural capital accounting and what is good for each of us as members of a connected community.
In that way, we need to raise a tax on ‘unsustainable goods’, which is to say goods that are not sustainable, which might mean local or Australian products depending on jurisdiction. Why should Chinese paper made from old growth forests be cheaper than recycled product owned by Australian businesses? In other words, our taxation system needs to be somewhat protectionist precisely because we need to protect our natural assets, which are in our national interests. For many, protectionism is a dirty word but in the messy application of theories one realises that trade is always reliant on lobbied interests. Free trade is only for beautiful idiots. To deny this because of some ahistorical abstract idea is as naïve as it is dangerous.
This is where craft and local economies need our support, from milk to art and beyond. Taxes could be raised in three levels. From the lowest to the highest they are:
- local goods
- imported goods
This is because taxes deter behaviour and we need to realise that our behaviours have to change so we are better off and can chart our own course as a society working together. It is a good thing to have a service economy precisely because it minimises the overconsumption of goods, which is to say, it enables a more sustainable practice for spending one’s time meaningfully.
With a reformed and enlarged taxation system we need to save for the rainy days and shift the way in which people spend their time. Politicians need to inspire people when the sea gets rough and direct the boat at the same time. That means taxing bad behaviour by all of us, and, when it comes to new industries, providing leadership and redistribution to those most in need.
We need, then, to redirect economic activity into good commerce. This is not an out-dated twentieth century argument advocating irresponsible tax and spending in a simple welfare state. It is about how to re-route the activity of one’s life. This can be done through economic re-engagement. It is also to simply observe that people are willing to pay taxes when they are given a project they believe in. We must believe in Australia again as part of a climate-changing world. We must say that Belgium, Denmark, Finland, Luxembourg, the Netherlands have got it right when it comes to taxation, which is at the upper end of the global scale. One might also be tempted to suggest that high taxation encourages social cohesion and not only because one must have the idea of belonging. It does this because it also gives the water-cooler people something to complain about. Sometimes a force to negate is not always a bad thing. The task for Australia though is making our economic basis more sustainable so we can all manage what is a rapidly changing ecosystem.