Apparently, the nation’s chief executives and other top people are groaning under the weight of the tax they pay. Is it any wonder they’re doing such an ordinary job of running the country’s big businesses? When you see what’s left of their pay after tax, it’s a wonder they bother turning up.I know this will shock you – just as it does every time the business media remind their readers of it. According to the latest available...
Friday, February 23, 2024
Wednesday, February 21, 2024
Why fixing negative gearing would be a positive for our kids
Life wasn’t meant to be easy for our politicians – which is as it should be. Poor old Anthony Albanese. No sooner has he got away with breaking his promise on the stage 3 tax cuts than he’s besieged by people demanding more tax reform.Trouble is, they all want different things, and every one of them could cost him votes as fat cats who stand to lose some tax break join forces with the opposition to run a great scare campaign,...
Monday, February 19, 2024
Lest we forget the unknown public servant, working to inform us
Have you ever wondered how much taxpayers’ money is wasted by our politicians and public servants? Do you hope that every dollar governments spend is fully accounted for?And would you like it to be made public not just how much was spent on public servants’ wages, rent, grants, paperclips and other administrative expenses, but how much was being spent on each of the individual programs within education, health, police, courts,...
Friday, February 16, 2024
We can't escape a carbon tax, which is good news, not bad
When economists are at their best, they speak truth to power. And that’s just what two of our best economists, Professor Ross Garnaut and Rod Sims, did this week. In their own polite way, they spoke out against the blatant self-interest of our (largely foreign-owned) fossil fuel industry.They sought to counter the decade of damage done by the former federal Liberal government which, for short-sighted political gain, engaged in...
Wednesday, February 14, 2024
Want better productivity? Start by ensuring our kids can read
The trouble with our economy is that there are so many things needing to be fixed, it’s hard to know where to start. And so many of them are urgent we don’t have time to fix things one at a time. But since the economy consists simply of all the workers and all the consumers – that is, all the people – one of my guiding principles is that governments should manage the economy for the many, not the few.This may seem obvious but,...
Monday, February 12, 2024
Let's stop using interest rates to throttle people with mortgages
What this country needs at a time like this is economists who can be objective, who’re willing to think outside the box, and who are disinterested – who think like they don’t have a dog in this fight.On Friday, Reserve Bank governor Michele Bullock, with her lieutenants, made her first appearance as governor before the House of Reps economics committee.See if you can find the logical flaw in this statement she made: “The [Reserve’s]...
Friday, February 9, 2024
You can (partly) blame cost-of-living crisis on greedy businesses
The nation’s economists and economist-run authorities such as the Reserve Bank have not covered themselves in glory in the present inflationary episode. They’ve shown a lack of intellectual rigor, an unwillingness to re-examine their long-held views, and a lack of compassion for the many ordinary families who, in the Reserve’s zeal to fix inflation the blunt way, have been squeezed till their pips squeak.There’s nothing new about...
Fifty years ago, I found my dream job – and I’m not done yet
If a genie ever sprang from a bottle and offered me one wish, it would be to have a job as a columnist on the biggest and best newspaper in the country, The Sydney Morning Herald. If he offered me a second wish, it would be to have my columns also published in the country’s other great newspaper, The Age.For the first seven years after I left school, I worked to achieve my dream of becoming a chartered accountant. Not any old...
Tuesday, February 6, 2024
Are the supermarket twins too keen to raise their prices?
The cost-of-living crisis has left many convinced the two big supermarket chains – known to some as Colesworth – have been “price gouging” – raising their prices without justification. “Gouging” is a rude, pejorative phrase that would never cross an economist’s lips (nor mine), but economic theory does say that, when an industry is dominated by just a few huge companies, this will give them the power to manipulate prices to their...
Monday, February 5, 2024
Bosses are finding more innovative ways to handcuff their workers
When I joined the John Fairfax superannuation scheme 50 years ago on Wednesday, I little knew my new boss was trying to handcuff me. Fortunately, they were “golden handcuffs”. But these days, bosses use other, more blatant ways to tie their workers to them and stop wages growing so fast.The Fairfax scheme I joined decades ago must have been fairly common among big companies in the years after World War II, when shortages of skilled...
Sunday, February 4, 2024
The next thing on Albanese's to-do list: fix competition
In a capitalist economy, every capitalist professes to believe in stiff competition. In truth, it’s their biggest hate. Why? Because it limits their ability to put up prices and makes them work harder for their money.Just this week, big business has been saying that, if only we could get proper tax reform – by which they mean lower taxes on companies and the highly paid – we’d get more productivity and more innovation.In truth,...
The two big parties have wedged themselves into a corner on tax
Politicians want us to think things like the stage 3 tax cuts are matters of high principle: keeping solemn promises or redirecting tax relief to those who’ve been doing it toughest. But the sad truth is, it’s just as much about the two big parties using tax promises and tax scares to damage the other side and win elections.The great lament coming from the big end of town is that the latest squabbles just go to show how, between...
Why all politicians want to use bracket creep to mislead you
Another round of tax cuts; another round of politicians saying tricky things about bracket creep. Whether they’re giving some of it back or letting it rip, our pollies on both sides hope bracket creep remains, as it has long been, their dirty little secret.The latest is the claim that Anthony Albanese’s changes to the legislated stage 3 tax cuts will, over the next 10 years, cause income tax collections to be $28 billion higher...
Albanese uses tax cuts to ease cost of living pressure - a little
Having trouble deciding the rights and wrongs of Anthony Albanese’s claim to be changing the stage 3 tax cuts in a way that helps ease cost of living pressure without adding to inflation? The air’s been thick with economists making confusing statements on the topic.For instance, economists at one bank say any tax cut will add to inflation pressure, but canning the cut would allow the Reserve Bank to lower interest rates...
Good policy, values and politics all agree: change the tax cuts
I have no inside info on whether Anthony Albanese will stick to his oft-repeated promise to deliver the stage 3 tax cuts intact on July 1, or change them in some way because the cost-of-living crisis means all bets are off. I don’t even know that the measures he’ll discuss at the meeting of Labor’s caucus on Wednesday will be the last word on what we’ll see in the May budget, or on our payslips after July 1. I’m paid...
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