The first two days of the Treasurer\u2019s economic reform roundtable went well, at least if you ask Jimbo. Lots of back-slapping consensus, even though much of the agreement was completely inane, such as supporting better regulation. Does anyone support worse regulation?<\/p>\n
To be sure, the Prime Minister couldn\u2019t avoid the temptation on the first day of having a dig at the Governor of the Reserve Bank, Michele Bullock \u2013 also referred to as Sandra.<\/p>\n
You must understand that Anthony Albanese regards concepts such as the non-accelerating inflation rate of unemployment \u2013 the NAIRU \u2013 as essentially a conservative plot devised by neo-classical economists.<\/p>\n
He was taught this disdain in his undergraduate studies in political economy at Sydney University all those years ago. It\u2019s just a pity he hasn\u2019t forgotten the drivel he was taught.<\/p>\n
Mind you, non-economists have no trouble understanding the concept of the NAIRU. Running the economy too close to full capacity unleashes inflationary pressures. D\u2019oh, as Homer would say.<\/p>\n
However, Albo made a pointed reference to the fact that inflation in Australia had fallen, albeit slowly, without a significant increase in the rate of unemployment. \u2018That\u2019s not my government\u2019s way,\u2019 he thundered, thus undermining the independence of the Reserve Bank while taking credit for something the government didn\u2019t actually achieve.<\/p>\n
Unemployment remained low, albeit rising somewhat, principally because the taxpayer has been funding four-fifths of the new jobs. Were it not for this, we would have experienced increases in the rate of joblessness like Canada and New Zealand.<\/p>\n
That our budgetary position is quickly deteriorating and our national debt is rising rapidly are also ignored by our Dear Leader. To his mind, concern for these issues is another example of a conservative plot devised by neo-classical economists. When Albo was at the varsity, he was taught that the government could simply print more money, if needed. Because that has worked so well in places like Argentina (in the past) and Venezuela.<\/p>\n
It was not until the third day of Jimbo\u2019s shindig that the hand-holding chumminess fell apart somewhat. And let\u2019s be clear here \u2013 day three was always the point of the in camera get-together.<\/p>\n
The aim was to soften everyone up for higher taxes, particularly on older people and anyone with wealth. Productivity was simply a smokescreen. Jimbo and Albo don\u2019t give a fig about productivity, particularly if doing something about it would hurt their comrades and supporters.<\/p>\n
The loony ideas came thick and fast.\u00a0 Aruna Sathanapally, who currently heads up the Grattan Institute, had a basketful of ideas of raising more taxes. Let\u2019s not forget here this is the Institute\u2019s signature dish, \u2018Policy au Grattan\u2019 \u2013 raise more tax revenue and don\u2019t worry about who it hurts or any economic damage.<\/p>\n
All the faves were trotted out: negative gearing, capital gains discount, tax on trusts, superannuation taxes, inheritance tax, land tax, yada yada yada. \u2018Hit the rich, hit oldies\u2019 was the theme of the day.<\/p>\n
Of course, Jimbo listened carefully. For him, it was like watching a game of footy where his team was winning by a big margin. There would have been a few in the room who muttered some objections \u2013 probably not the weak leaders of the business groups who were there just for show \u2013 but this disapproval was easily batted away by the majority.<\/p>\n
Of course, it was a complete stitch-up; making the case for higher taxes was the real purpose of the three-day event. Gosh, you couldn\u2019t expect the government to rein in spending. Following predetermined fiscal rules is so yesterday. For Labor, government spending is like sperm: every drop is sacred.\u00a0 Just ask the Monty Python crew.<\/p>\n
Having said this, the quote of the day went to Sally McManus, secretary of the ACTU. I had always wondered whether she is as thick as a plank, notwithstanding her political guile. Confirmation followed on the final day. She declared that lowering the burden of tax doesn\u2019t raise living standards.\u00a0 Que? So, when people have more money at their disposal, it doesn\u2019t make them feel better off.<\/p>\n
Jimbo achieved exactly what he wanted from this magnet for the media: a set of criteria to raise taxes while ignoring virtually all the key factors that drive productivity growth. The one exception is the decision to pause the National Construction Code (NCC), which had been a Coalition policy taken to the last election. At that time, former minister Ed Husic, described the policy as \u2018stupid\u2019, but he doesn\u2019t count anymore having been demoted from the ministry. He now just shouts at the moon, criticises Israel and no one takes any notice.<\/p>\n
But the latest version of the NCC had gotten completely out of hand, with the green prophets taking control. Every new home would be required to have EV charging capability and double-glazing would be mandatory throughout the country \u2013 because of climate change.<\/p>\n
The builders\u2019 associations did the sums and estimated that the cost of building a new stand-alone house would rise by between $30,000 and $50,000, which included the compliance costs of dealing with the more than 2000-page building code.<\/p>\n
(Having awarded my gold medal for the most ridiculous comment of the jamboree to Sal, Cassandra Goldie of the Australian Council of Social Services \u2013 she seems to have been in that job since I was teenager \u2013 deserves a special mention. She argued against the pause to the NCC because, in her view, the green tape will lower energy bills. But hang on, doesn\u2019t she represent the most disadvantaged members of the community who will never be able to buy an environmentally sensitive dwelling; nay, any dwelling?)<\/p>\n
Let me get back to the pre-cooked tax guidelines that Jimbo released minutes after the bash wound up. They are:<\/p>\n
\u2013 Achieving a fair go for working people including in terms of intergenerational equity;<\/p>\n
\u2013 Finding an affordable, responsible way to encourage business investment;<\/p>\n
\u2013 Making the tax system simpler, more sustainable to fund services, particularly with an ageing population.<\/p>\n
The translation of these dot points is as follows: we don\u2019t want to tax income and consumption any more than we currently do, so a Labor government is going after savings\/wealth and targeting older people and the wealthy. Expect to hear a lot more about \u2018intergenerational equity\u2019 as the guiding principle for stealing the assets of people who were encouraged to accumulate them according to the rules of the day. We will be told that it\u2019s only fair. There won\u2019t be any grandfathering of the changes to the tax rules, unlike when treasurer, Paul Keating, introduced the capital gains tax.<\/p>\n
Grandfathering might be a fine principle to minimise sovereign risk but, hey, you don\u2019t raise any serious revenue for years if you do that. That\u2019s not what Jimbo has in mind. He wants more tax revenue, and he wants it now. That\u2019s what the real message of the roundtable was.<\/p>\n","protected":false},"excerpt":{"rendered":"The first two days of the Treasurer\u2019s economic reform roundtable went well, at least if you ask Jimbo.…\n","protected":false},"author":2,"featured_media":103336,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-103335","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/103335","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=103335"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/103335\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/103336"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=103335"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=103335"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=103335"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}