Friday, June 04, 2010

Cargo-cult economics endangers the Golden Goose

By Greg Lindsay

Being situated in the South Pacific, close to the market of Asia, has proved a god-send for Australia. A culture of hard work, good institutions, and probably some luck have helped us dodge the worst of the Global Financial Crisis better than most. However another less admirable cultural feature of the South Pacific seems to have infected thinking at the national level in Australia.

The Rudd government’s Resources Super Profits Tax (RSPT) confirms what Ronald Reagan said about politicians and their view of the economy: ‘If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.’

There is no doubt that Australia’s mining industry is moving fast. So fast, in fact, that the ‘golden goose’, as the resources sector has been dubbed, has helped pull the rest of the economy through the challenges of the GFC. Other countries would kill for a sector like this. The world’s leading mining companies are generating profits, jobs and tax revenue for all Australians.

The temptation for politicians to squeeze even more money out of the mining industry is easy to understand. They are acting precisely as Ronald Reagan predicted. But they are ignoring another bon mot about taxes, this one coined by former French finance minister, Jean-Baptiste Colbert: ‘The art of taxation consists in so plucking the goose as to obtain the largest amount of feathers with the least possible amount of hissing.’

There has been a lot of hissing following the announcement of the RSPT. That miners do not look forward to paying higher taxes is only be to be expected. Nobody does. But what is far more damaging to the long-term national interest is what this episode says about the cargo-cultist direction of economic policy in this country.

The Prime Minister has argued that mineral, oil, and gas reserves ‘belong to all Australians’. But why stop there? If you apply the same rules, sunshine and our beaches belong to all Australians, but the government hasn’t (yet?) proposed an extra sun and surf tax for agriculture and tourism.

The government claims the RSPT is a special case since it will mainly apply to foreign-owned companies. This is a very dubious and short-sighted rationale given the millions of Australians who have mining shares in their superannuation portfolios. What is even worse is the economically destructive message sent to the international business community: ‘Beware Australia and its unpredictable and punitive taxes!’

Improvements to the taxation regime for resources sector is an important policy goal. But the RSPT is bad policy for all sorts of reasons including the political predisposition it reveals for higher taxes and economic nationalism. But perhaps the most irritating feature is the disrespect on display for entrepreneurship, risk-taking and property rights. In short, we are being led right back to the kind of dirigiste policy settlement overcome by the reforms of the Hawke, Keating and Howard governments.

Regardless of the political justifications trotted out by politicians and their technocratic advisers, temporary budget fixes like the RSPT is not the path to national prosperity. My fear is that we are starting to resemble the villager of the South Pacific isles of cargo cult infamy, who stared into the sky in expectation of untold riches. Waiting around for the golden goose to land is no substitute for hard work, risk, and investment.

PS. I despair. The Treasurer now says the tax is essential for the future prosperity of Australia. Where do I start . . . . ?

The above is a press release from the Centre for Independent Studies, dated June 3. Enquiries to Snail mail: PO Box 92, St Leonards, NSW, Australia 1590.

Paid parental leave policy is missing actual leave

Interesting comment from a Greenie politician excerpted below. Greens tend to be further Left than the Labor Party. For once, I think the Rudd government has struck the right balance on this. If the government makes employing women disruptive to business, some businesses are going to stop hiring women

The Government needs to come clean on what its Paid Parental Leave Scheme really means for working families, starting with its name. It’s a great irony that an initiative called Paid Parental Leave does not actually give anyone an actual right to time off work after birth. In fact, if an employee has been working for less than 12 months, they have no guarantee they can return to their job if they take leave.

All the Government’s scheme does is entitle employees to a payment (18 weeks at the minimum wage) even if their employer won’t give them their job back.

A payment, but no leave? That sounds suspiciously like the baby bonus, by a different name. Like so much of the Rudd Government’s ‘reform’ agenda, to quote Keating on Costello, this scheme is “all tip and no iceberg.”

Let’s not forget Paid Parental Leave has been on the agenda for women’s groups and unionists for more than thirty years. Recognition of Paid Parental Leave as a workplace entitlement has been at the heart of this movement. Yet, it’s missing from the Government’s plan.

Given the unpaid parental leave provisions (52 weeks) are protected by the Fair Work Act, why is it that the Paid Parental Leave provisions do not have this status? The Government is basically saying to working Mums and Dads, “she’ll be right, the boss’ll look after you.” Bizarrely, ACTU President Sharon Burrow has bought this line and is encouraging the Senate to pass the legislation without amendment....

It’s clear the Government is approaching this as a social welfare payment, rather than a workplace entitlement. Evidence from the Senate Inquiry, given by Government bureaucrats, clearly stated it was a payment scheme with no commitment to leave entitlement.

Labor’s Bill for a mere 18 weeks sets Australia apart from other countries with Paid Parental Leave. While Sweden’s scheme offers 47 weeks, New Zealand offers 28 weeks, Finland offers 32 weeks and even Spain offers 27 weeks, the best our Government can offer, after decades of public debate, is four months.

The Government has a unique opportunity to provide a scheme that is aligned with the World Health Organisation’s standard (minimum 6 months), that is universal and integrated into Australia’s industrial relations regime. This is why working parents need six months plus super. Unfortunately, the Government’s plan doesn’t come even close.

Despite the deficiencies in the Bill, the Senate is being asked to simply roll over and give the Government’s plan the tick of approval, without any attempt to improve it. To simply surrender this opportunity to get the right scheme in place, would be to squander the legacy of all those who have been fighting for this issue, for so long.

The Senate owes it to those dedicated women and men to produce the best legislation possible. Most importantly, Australian parents and babies need a better scheme.


Climatologist is a true believer

The idiot below doesn't seem to realize that his findings make a mockery of Warmism. Saying that "greenhouse" gases are rising at a great rate while at the same time there is actually no warming going on is not the best way of supporting your theory. Note that he doesn't mention any facts about temperatures

It is windy, cold and isolated. Cape Grim is at the most north-west point in Tasmania. It is also home to some of the cleanest air on the planet and for that reason, it is the most important air measuring station in the southern hemisphere.

The Cape Grim research station, perched on the cliffs overlooking the Southern Ocean, is recording the most precise account of the earth's changing atmosphere.

But it is not all good news - over the last 12 months scientists have identified two potent greenhouse gases that are accelerating rapidly. Paul Fraser from the CSIRO has been coming to the station since it opened in 1976 and he says that over the last 30 years, carbon dioxide levels have increased by 15 per cent. "Almost entirely that increase in carbon dioxide in the atmosphere is due to fossil fuels and that's entirely man-made," he said.

In fact, 40 different types of greenhouse gases are measured at Cape Grim. But it is two new gases recently identified that are accelerating rapidly. One, nitrogen trifluoride, is used in the manufacture of plasma televisions. The other is sulphuryl fluoride, a fumigant used on crops.

Mr Fraser says in the long-term, the two gases will have climate-warming potential. "I think they're rising at between 5 and 10 per cent per year so they're jumping up quite rapidly from virtually zero concentrations not long ago," he said.


'Life ruined' by Customs porn confiscation

What's the point of this stupid policy? You can download anything and everything off the net anyway

A Melbourne man says his life has been ruined after Customs officers took his hard drive from him because it contained pornography. Customs has recently started asking incoming travellers if they are carrying pornography in a bid to block illegal pornographic material entering the country.

Ross Mansfield had his hard drive confiscated a fortnight ago when he was coming home from a holiday in the Philippines.

"They said I had some suspicious material on there. "I said 'I forgot to remove any porn because my friends in the Philippines, they download it, they're mutual friends'."

Mr Mansfield says despite the suspicious film was nothing more than standard porn. "They (Customs) are violating my rights," he told AAP. Despite defending the contents of the hard drive, Mr Mansfield admitted to not having seen the film and said "I don't know what it is".

Other movies included Adult Pretty Woman, Real Female Orgasm, Asian Babe Moans, My Friend's Hot Mum and Sexy Blond. "They're all over 18. "It's nothing underage." The hard drive also contains about 5000 holiday photos and 30,000 songs.

Mr Mansfield threatened to sue Customs if any of the material was deleted. "I've got my livelihood on there. "I'm more worried about the fact that they try and wipe out what's on my hard drive. "If they touch my stuff I would find a lawyer ... I would be after suing them."


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