The Budget: the consequence

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By Catherine Cashmore, a market analyst, journalist, and policy thinker, with extensive industry experience in all aspects relating to property. Follow Catherine on Twitter or via her Blog.

Last week, Joe Hockey stood up in front of Parliament and on behalf of the Abbot administration, announced:

”The age of entitlement is over. It has to be replaced, not with the age of austerity, but with an age of opportunity!”

The former multi millionaire banking and finance lawyer, husband to an investment banker, and owner of several premium land holdings, including a 200-hectare cattle farm in Malanda and mansions in Sydney, whose own ‘entitlements’ and that of his colleagues, remain largely untouched, spelled-out changes to address:

  • The single mother set to lose more than $3000 per year;
  • The newly unemployed university graduate and retrenched worker, who must live with no income for 6 months (poverty) before claiming Newstart (forgone benefits of more than $7000) – yet still have to service their rent or mortgage;
  • The low wage family with kids, who will lose $6000 a year once all changes are factored in;
  • The Hospitals and Schools – vital pillars of our society – who lose their projected funding (on the rationale that they are state responsibilities, forcing an increase to GST – a regressive tax);
  • The bottom one-fifth of earners who will lose around 5% of their disposable income, compared to the top one-fifth, who will lose only 0.3% (modelling undertaken by NATSEM who point out the burden of this budget, overwhelmingly falls upon people in the most precarious position);

..by telling Australian public, that they are not “to be alarmed,” because – it’s all “in the national interest”.

“The National Interest” what an outrageous statement:

The National Interest is a deliberate distraction from a budget, that surgically sets about reducing living standards of the poor, low to middle-income earners and small businesses – the most productive sectors of our economy – while studiously protecting the assessed $484 billion total increase over 12 months in unearned capital gains (more correctly termed “economic rent”) stored in land holdings (ABS).

Or laying a finger on the licenced resource monopolies, the mineral wealth of which increased by $56 billion in 2012-13 alone.

Does this sound fair to you?

The country we want..

“It’s about the sort of country that we want to be, in the years and decades ahead. It’s about the value we impart.”

…continued Hockey – who has requested that all complaints be directed to ‘the former government’– adopting the age-old habit of passing the buck.

Yet, warnings were given well in advance of this “budget emergency,” and the sensible and equitable reforms needed, laid our in the Henry tax review – which they ignored – all of them.

The ‘sort of country we want to live in the years and decades ahead’ – is an apt question to ask – albeit, it should be directed at our children.

After all, they are the ones set to inherit this land and it’s their future the Government is shaping. More importantly, it’s not a matter the Abbott government is entitled to single handily dictate on either their or our behalf.

No doubt, job security and housing affordability would come top of the list of desired outcomes – both are interdependent and serve the most basic needs of all.

Without land, or the ability to use it, rent it, or buy it, we’re unable to do, or produce anything. We are by definition “poor.”

Our accumulation of ‘stuff’ is due to the bounty land bestows. It is no coincidence that in both religious and ancient mythology, the first task humanity was to tend the land.

Our relationship with land is truly unique.

The quality of its location, the pride in its ownership, tenancy, and care of its product, lays the foundation for a thriving community of healthy individuals.

Destroy the land, or prevent ready and affordable access to it, and you destroy a population.

The consequence is as black and white as that – “Pay the rent or leave.”

And it is no surprise, that this budget ignores the role of land in its economic modelling – Liberal and Labor alike have been ignoring it for decades.

It’s not included in the Consumer Price Index for example – the tool the RBA use to measure inflation and reflect the cost of living, despite land prices and the size of the loans needed to service them, having an uncanny consistency of exceeding wage growth through the course of each cycle – at least for that of the average household and income earner.

And it’s easy to lay the blame of inequality or the reduction of it, on income distribution alone, either that, or confuse it with other items of ‘wealth’ – as is the case in Thomas Piketty’s book “Capital in the 21st Century” (a subject I explored in part last week.)

Some items are easy to hide in tax havens – but you can’t do that with land.

More importantly, while the politicians behind this budget and the other “twenty percenters,” will only feel a modest change to their disposable income with the newly imposed ‘wage levy,’ they will claw far more back in the increased value of their land holdings – particularly as we enter the next economic cycle.

The Cause of Wealth inequality – the extreme of which is “poverty”:

Australia’s lopsided economy is the cause of our wealth inequality –built on a $5.1 trillion housing market -over $4.1 trillion of which is land.

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(Source)

It is overwhelmingly ignored, yet shapes every area of housing policy – due in part to the vested interests of wealthy land owners who lobby our politicians to maintain the current trajectory. as well as those politicians don’t want to see their “investments” affected either.

This corruption of economics is not unique to Australia. It began soon after Henry George took the world by storm in 1879, when he successfully communicated the root and leading indicator of the massive boom/bust cycles (although he was not the first to do so,) – the inflated price of land.

His farsighted solution, whilst understanding the importance of private ownership, clearly demonstrated the depth and severity of recessions and depressions could be avoided, if the natural revenue from economic rent was proportionally used to provide the government services we require, rather than pocketed for private interest.

This removes excessive and unwanted speculation from the market, assists homebuyers, utilises land effectively, improves productivity with lower land prices, and can assist in increasing wages – which would help the workers – not the land hoarders.

He influenced the likes of:

David Lloyd George in England,
Leo Tolstoy,
Billy Hughes in Australia,
Rolland O’Regan in New Zealand,
Chaim Weizmann in Israel,
Francisco Madero in Mexico, and many others including,
Winston Churchill,
Milton Friedman and
Albert Einstein (to name but a very few.)

Quite simply, he took the political world by storm.

The people it didn’t impress however, were the large landowners, financiers, and political lobbyists, who set about a on a well-constructed and amply funded mission, to change the course of economic education – thereby erasing the classical models which recognised the role of land and highlighted Henry George’s ideas.

“The Corruption of Economics”:

Mason Gaffney and Fred Harrison chart the full story in their book, “The Corruption of Economics.”

They show how the three elements of production—land (and resources ) labour, and capital ( the ‘industrial’ kind) were gradually reduced to two – Labour and Capital – land being lumped in with the latter.

Capital ceased being man made, the result of hard work and genuine innovation.

Instead, it included the stuff of nature – the very elements we need to live – allowing the increasing gains from any natural appreciation of land value (the expected result of every collective improvement we make to society) to be pocketed privately rather than shared by serving as the key source of government revenue.

It obliged home-owners to pay directly for the facilities they use – the amenities that give their land its value – while focusing government resources on other taxes which are easy for the wealthy to avoid – like income tax.

That sounds fair doesn’t it?

‘All taxation is at the expense of Rent’:

As the classical economists David Ricardo and Adam Smith proved, ‘all taxation is at the expense of Rent.’

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(Source)

In other words, any tax withholdings or exemptions given to land holders, result in an increase of “economic rent” available to be capitalised (at the current interest rate) into the price.

This raises the cost of land – yet does little to address the needs of our children, who must take on an every greater proportion of private debt to ‘join in.’

Consequences:

This leads directly to Australia’s current budget, which wants to collect taxes to offset the items we require from wages and productivity – the burden of which falls overwhelmingly on the poor – simultaneously advantaging those at the top of the tree, who see the value of their landholdings increase, way in excess of any taxation or wage benefits.

Is this fair?

Well this is what the current and previous governments have been enforcing for years.

Promoted widely by our ‘balanced’ property commentators – who preach how to get rich on capital gains (as if it’s hard) – without acknowledging the consequence and burden to the economy as a whole – including the impact on the next generation of priced-out buyers.

Think about that when you’re browsing the well-stocked property investment aisle in your local bookshop.

Think about it.

Who benefits??

The progress of genuine innovation:

Thankfully with the birth of genuine innovation – the internet – we finally have the beginnings of a global revolt against mainstream economic teachings which cannot identify boom/bust cycles and crashes, because they are blind to the role of ‘land.’

Not to mention their completely false understanding of money creation and debt and its role in banking – highlighted consistently by Steve Keen who is about to head the first “progressive” department of economic teaching at Kingston University in London. Our loss.

Importantly, economic students are starting to recognise their degrees are hardly worth the paper they’re written on – as the protests for heterodoxy show.

Change:

Changing the system is not easy when we have built a society dependent on housing wealth to fund retirement.

It requires a slow transition – such as that set out in the Henry Tax review – to gradually phase out tax subsidies such as negative gearing – offset by the supply reforms Leith van Onselen, Hugh Pavletich, Senator Bob Day and many others have been advocating for years.

But if you want a “fair go” country, one that avoids volatile boom-bust cycles, and instead of promoting wealth inequality, provides economic prosperity and true opportunity. Promotes genuine innovation, competition, research, education, and affordable housing – in otherwords, the best we can provide for our children, then change we must.

And it starts with ‘us.’

59 Responses to “ “The Budget: the consequence”

  1. Rusty Penny says:

    “And it starts with ‘us.”

    I understand the sentiment, but it won’t happen unless we all arrive at the bottom. It is meltfund’s real genius.

    For getting to the bottom, luckily for us the guy who occupies the lodge is the right man for the job.

    • migtronix says:

      I fear our comrade MeltFund will not take kindly to this.

      • Catherine Cashmore says:

        Understand that – but the only ears that listen at the bottom are the ones that have been hit hardest – not the ones bailed out.. or in control.

      • As land price changes become more parabolic, so does the certainty of a violent correction at the hands of Mr Market. The spivs, the ‘Gearers and the leeches will be neutered, at least for a time.

        Catherine’s proposal – to tax land and natural resources, not labour and capital – would transform our desiccated economy and restore incentive for all.

        Land is the largest single asset class. It moves in giant cycles of 70 years or more, to climax in moments such as today.

        If FHBs are excluded on price, where is the new money and fresh loans that allow equity extraction by those leaving? The Chinese? Give me a break. The only solution for those not in the position of having deep-sunk investments or willing to sell at a moment’s notice is to stand aside.

        Don’t Buy Now!

  2. briefly says:

    We better start taxing wealth again.

    • Catherine Cashmore says:

      Land tax – or collecting rent from the locational revenue that comes from any community improvement – recycling it back to fund local facilities homeowners use – is not a wealth tax … Wealth should come from productive efforts – investment in business etc – not the unearned gifts of nature/land etc which we all need for survival – it’s important to see the difference.. because driving up the price of land destroys capitalism/competition – it does nothing to support it.

      • briefly says:

        I love your work!!!

      • Skoptimist says:

        +1000

      • bobalot says:

        Hear! Hear!

        It’s criminal that the most vicious cuts in the budget to the poor, the young, the disabled and the elderly total $18 over four years.

        The Paid Parental Leave scheme costs $22 Billion over 4 years.

        That simple fact destroys the claim that this budget is really about cutting the deficit.

        This is a budget for the financial, resource and property rent seekers in this country.

      • Billybob McBob says:

        Well said CC, and great article. Keep fighting the fight!

      • Opinion8red says:

        “Land tax … is not a wealth tax … it’s important to see the difference.. because driving up the price of land destroys capitalism/competition – it does nothing to support it.”

        Exactly. As highlighted, the meaning of the word “capitalism” has been distorted over time. This leads to confusion.

        It would be more accurate — and helpful — to choose a new word to denote “natural capital”, and, to replace the now-muddied word “capitalism”, with the word “usuryism”.

        Usuryism is the unnatural, contra naturam growth of money (electronic bookkeeping “capital”), from money.

        As NAB states it in “How do banks make money?”, their product is money.”

        Driving up the price of land is a direct effect of usuryism.

        “In other words, any tax withholdings or exemptions given to land holders, result in an increase of “economic rent” available to be capitalised (at the current interest rate) into the price.”

        The money quote, for anyone concerned over inflated RE prices, and all related evils. Memorise it.

        It’s called Usuryism.

    • Gunnamatta says:

      Whether we tax wealth or land the situation we are in, where we beat up on single mothers and the sick to fund…..

      novated car leases
      superannuation concessions
      negative gearing
      capital gains tax dispensations

      which are all accessed by the older or wealthier, and then encourage SMSF’s to leverage up into real estate. Thats after we hand out pensions to wealthy elderly without looking at their residences, whether they have had (and blown) a lump sum super payout, or even if they have been on the public teat in the form of negative gearing or CGT etc over the course of their lives.

      Is nothing short of generational ransoming.

      Then on top of that we have to have the budget deliver a surplus over the cycle in order to be able to backstop bank lending. This is equal to about a two rating notch reduction in their borrowing costs –

      And we do not charge the banks for it.

      So we are beating up on the poor and the sick for the purposes of the wealthy, particularly the elderly wealthy, and the banks.

      Neither the ALP or the Liberals have ever seriously addressed this issue. They are not the answer, and people wanting an address to Australia’s intergenerational economic issues will need to find a new one. I have actually thought of standing for a senate seat myself on just a platform of overturning those issues. I reckon there would be enough votes to get a seat.

      • Billybob McBob says:

        Do it Gunna. Better yet, get one likeminded soul in each state and get the balance of power. There’s enough disaffected with the situation that you’d pick up one in most states

      • Arben says:

        You should run for the senate. There needs to be an articulate focal point for political pressure. The Lib Lab Green parties are never going to confront the fundamental economic issues.

      • athalone says:

        Yes, the only way your generation is going to change things is through becoming political… I don’t think Australians have the stomach for revolution.

        But then you have to pick the right type of representative…not someone who’ll find it a tad too hard once they get to Canberra, and end up with their own head in the trough… That won’t be a cinch.

      • briefly says:

        Gunna, if you wanna run, you gotta.

      • Skreese says:

        Go for it Gunna you bloody ripper! You would get my vote. If communicated well you could get votes right across the age spectrum. Baby boomers have children also.

      • McPaddy says:

        Please do it, Gunna.

      • footsore says:

        @ briefly

        I find your comments to be the clearest, and least repetitive of the persistent commentators on this site. You should do summaries for Gunna. The MSM would definitely reprint what you provided.

        And if Gunna can’t be bothered facing the Morning infotainment crowd, or go on Q & A, Spleenbat should step in for him. I’d love to see Spleenbat opposite Christopher Pyne or Kevin Rudd. Anyway, enough flattery.

        And as always, thank you Catherine, another excellent piece.

      • tmarsh says:

        Do it.

        Aus Independent Party. (Or whichever name you deem appropriate.)

        I will man the booths in Page.

        Do it.

        I have a bit of marketing experience, is there any way to contact you privately? You can contact me via the URL attached to my username.

      • sheltie says:

        You are the man for the job Gunna, do it. I have long admired your comments and the way you articulate them. And also the great interviews you have done on radio with Leith van Onselen, Steve Keen, Catherine Cashmore, etc. You are the man Australia needs to convey the message to the general public about the social inequality in this country, and the vested interest lobby groups influence on the major political parties.
        And yet another great article by Catherine Cashmore.

      • md says:

        Gunna, you’ve got my vote.

        Anyone else out there who hasn’t yet shown their support for Gunna, please do so now. He is the voice we badly need in the political arena.

  3. migtronix says:

    Wow!!! Hat’s off Ms Cashmore you went all out!

  4. migtronix says:

    Putting the screws to the one’s who can’t do much about it and not many notice is tried and true fodder for Torys but its became a blatant appeal to neo-liberal ideology – trying the sort of “Shock” thing Sachs did in Peru and Poland et al – where with Howard they cracked the wall of private health care and then these days say no one can have it for free, its pretty bloody obvious where this is leading — as drsmithy rightly points out. But then there’s the way its being done!! Force the kids to work at any rate going – No Penalty Rate For You – and pick their pockets to keep the life-styles-of-the-daft-and-indolent going while calling them “leaners” if they’d like to be able to afford a house or get some interest payment on their savings. God it just make me so eff…..

    • fitzroy says:

      What is happening now is about as far as you can get from the “forgotten people” speech of Menzies in1942. It wasn’t always like this in non labor land and really is a national tragedy. The small “l” liberals have been marginalised in their own party by tea party people who represent vested interests, not national interests. They are in fact the real opposition to executive power between elections.

      • flawse says:

        “Tea party people”
        I don’t think that’s the problem with the Libs. ( Fair to say I don’t see a lot wrong with much of Tea party ideas either but that’s another topic) I’m thinkingn the Libs are dominated by two basic groups. The first is the really big end of town who don’t see the rules that ordinary people function under apply to them. At the other end of the scale their demographic is possibly dominated by the Real Estate industry such as Agents and associated businesses and perhaps the next level of the finance industry..

        You aren’t going to get much sense along the lines Cashmore outlines from either group.

      • casewithscience says:

        @Flawse:

        ” The first is the really big end of town who don’t see the rules that ordinary people function under apply to them.”

        No, that is wrong. That group do see themselves as bound by the rules that ordinary people function under….. and they are really pissed off about it.

  5. Mason Gaffney’s chapters in The Corruption of Economics are available online. The printed version also includes contributions by Fred Harrison and Kris Feder.

  6. aj. says:

    This is another excellent piece Catherine. Once peoples eyes are open to the staggeringly huge tax benefits to the rent seeking classes and the financial system that supports the headlong rush to squeeze into this class, the truly pathetic budgets offered up by the Labgrals (the Labor, Green and Liberal divisions of the party system oligopoly) become almost embarrassing.

    Tinkering with wealth distribution and income at marginal percentages while ignoring the staggering entitlements through CGT, neg gearing and super that entrench rent seeking capital over labour is offensive.

    In the end Tony will collapse into the same mess that Gillard did. These are hacks that only know the old system, spent a life playing politics in it, were winners by attrition in a sick game with sick institutions.

    What people need to ask is ‘why does the party system not offer up any meaningful answers here?’. As someone put it nicely, the Labgrals (combined) have a lower membership than Collingwood football club, there is simply no social drivers here, there is only a ruling cabal and vested interests in each of these parties, and they easily fall victim to the failings of cronyism and nepotism and the lobbying of wealthy interests.

    • flawse says:

      “These are hacks that only know the old system, spent a life playing politics in it”

      Aha! The nub of the problem!

    • Heisenberg says:

      Agree excellent piece. For years I thought I was mad and the only one until I discovered this site.

  7. PJ Clearpool says:

    There are too many things that are not quite right. This budget screams the desperate need for a Federal ICAC.

    • Nudge says:

      Curiously, Laberals have knocked that on the head.

      Can’t get too close to the truth now can we?

  8. The Patrician says:

    Last night Ponzi Joe was Q&Aed for an hour and not one Q or A on new housing or land supply initiatives.
    In the week since the budget not one Q on housing supply..
    In the 9 months since Joe gave an undertaking on his last Q&A appearance to “do something about it”, our resident population has grown by 270,000 and there has not been one initiative on delivering new housing/land supply.
    Last Tuesday night Joe had the opportunity to boost new housing supply, and boost revenue and boost construction employment by restricting NG to new builds only.
    He chose not to.
    Why Joe?

    • Powermonger says:

      Why indeed. Opportunity wasted.

      Why are not Labor and The Greens pushing for this either? Their silence on this issue but banging on about other inequalities is a true indication of their sincerity.

      Easy to push the barrow for the poor on $7 medicare fee or higher education costs, but the true devil is ignored. Big Australia and land hoarding are the alpha causes of inequality and costs of living, denegrating the lives of current and future generations.

  9. Cloud Strife says:

    Marry me Catherine!

  10. Stephen Morris says:

    The democratic Swiss cantons – which are governed on behalf of their citizens rather than by corrupt politicians on behalf of their patrons – use wealth taxes (on all wealth, not just land) to keep down income taxes.

    Thus there is little disincentive to those engaging in productive work, but accumulated wealth (which often comes not from work but from the exploitation of market power) is taxed.

    Wealth subject to the tax includes (see http://www.pwc.com/us/en/hr-international-assignment-services/assets/switzerland-folio.pdf) not just real estate but:

    - immovable assets (real estate);

    - movable assets (securities and other investments);

    - cash, gold, precious metals;

    - cash value of life assurance policies;

    - shares in undistributed inheritances;

    - business capital, shares in a partnership; and

    - motor vehicles, boats, etc.

    Pension funds are not considered as assets, and all liabilities can be deducted in order to determine net wealth. In some cantons there is an allowance depending on the status of the taxpayer (married, single, number of dependants) while in others an allowance is made in the tax rate.

    Taxpayers must declare worldwide assets belonging to all immediate family members. Foreign real estate and qualifying business interest are exempt but made be taken into account in determining the tax rate. Liabilities are allocated according to the location of gross assets.

    Typical assessments for 2010 on CHF1,000,000 owned by a married couple were (from the same source):

    Zurich 0.2% (CHF2,000)

    Basel City 0.58% (CHF5,800)

    Geneva 0.62% (CHF 6,200)

    Of course, all this is predicated on genuinely democratic government. With democratic government citizens may structure their society as they wish. In the absence of democratic government no such reforms can be achieved, or if they are achieved they will soon be reversed by corrupt politicians beholden to their sponsors.

    Australia’s system of purely elective government is systemically flawed beyond the possibility of repair. Any permanent change must begin by addressing the pernicious incentives of elective government.

    Everything begins and ends with Democracy. With Democracy everything is possible. Without Democracy all other battles will ultimately prove futile.

    • Arben says:

      Other than politically, how can direct democracy be instituted? “Politics by other means” – aka violence?
      Arguing the system is “flawed beyond the possibility of repair” doesn’t appear to leave many constructive options. Why not for example institute micro-referenda on certain issues, which can be used to develop a functioning kernel of a system, and get the populace familiar with it?

      There seems to be quite a lot of sentiment against the possibility of political reform, but the alternatives seem to be carping apathy or violence. (And we know which option aussies will embrace).

    • Stephen Morris,

      You have missed a key message in Catherine’s piece. She doesn’t want to tax wealth, but land and economic rents. Wealth can hide and if it does capital is lost to its hosts. Land cannot hide. Government license cannot hide. Landownership to capture economic rents is lazy, sloppy capitalism. We need to direct the accumulation energies toward increasing industrial capacity. The giant projected population increases demand it.

      • Stephen Morris says:

        I’m aware that immovable land is easier to tax than movable assets, but that doesn’t seem to be an insurmountable problem provided that the tax rates are not too high.

        Also, the very wealthy have relatively little of their wealth in land. Bill Gates, for example, is reputed to have a house worth $150 million. Perhaps he has – at a guess – $500 million of land assets in total. But even that would be only 1% of his wealth.

        The further one moves down the wealth ladder, the greater the proportion of wealth that is held in the form of land.

        For young people borrowing to buy a house, their land assets may actually exceed their net assets!!

        In that sense, a tax limited to land would actually be regressive.

      • tmarsh says:

        +1 SM’s comment below.

        You cannot just tax land.

        We would lose our home and hobby farm.

        We are FAR from wealthy, nor are we landbankers.

        How do you account for small holdings and those with low income.

      • @ SM, tmarsh,

        Land assets of FHBs may well exceed their net worth in today’s current inflated market. If we look at history where dwellings are typically 3x wages, this is simply not a problem.

        The point of a land tax is not to enrich government, it is to enable the removal of other taxes and their deadweight losses. KPMG Econtech estimated these losses at $56 billion a year simply up in smoke. Ken Henry found 125 taxes he wants to scrap. First on the block would be Stamp Duty, a very harsh impost on FHBs.

        With these removed, tmarsh’s capacity to pay land tax on his hobby farm would be vastly improved. Land tax is equitable as it clearly reflects capacity to pay. Those able to buy and hold the most desirable sites clearly demonstrate this quality. If tmarsh has a low-value hobby farm, he need not fear.

      • Catherine Cashmore says:

        It is a payment by the owner on the locational revenue of the unimproved value alone – what you build on that lot is exempt.

        It is a direct payment for benefits received (local amenities) – to be used by the community that gives land its value.

        In it’s truest form – It would replace, not add to, existing taxes – from studies done by AHURI and in locations where LVT has or is currently being implemented, you would end up paying less tax with an LVT model, then you do currently.

        It should be noted that there are many ways to transition and implement an LVT/location revenue model – it is a slow change (as seen in Henry tax review) & one that would require understanding and working with local communities – it is not designed to force people into poverty.

        It is designed to encourage effective use and utilisation of land and make sure YOUR community gains the most benefit from its value. Not the Government.

        I will write about democracy next week.

      • Stephen Morris says:

        Catherine, I’m not denying the benefit of land tax.

        I’m simply pointing out that it doesn’t begin to address the much, much larger capitalised economic rents that accrue to the very wealthy.

        The market capitalisation of Microsoft, for example, reflects economic rent. The company did not invent the software which made its fortune. It did not invent the underlying concepts of DOS. It did not invent the concept of Windows. It did not invent word processing and spreadsheet applications. It made its fortune by identifying the opportunity to secure market power over an operating system that would acquire natural near-monopoly status because of the value of having compatibility between computers. And having secured market power, it milked it for all it was worth, charging customers orders of magnitude more than the cost of production.

        Land tax catches the relatively small fry and lets the bigger fish get through almost untouched.

        Let’s hope the piece on “democracy” is actually on democracy on not on the system of elective government.

        And let’s hope it doesn’t paternalistically assume a Monopoly on Wisdom or a “Charter from Heaven”!

  11. Slambo says:

    One of the best things I’ve read on MB Catherine. You are an insightful commentator who cuts through the econobabble and weasel words of vested interests to highlight the human impact. Thankyou for your effort, and keep up the good work.

    Gunna, if you do decide to run for senate on your stated platform, you are a brave man, but you will receive every vote from my household.

  12. General Disarray says:

    This was excellent. Thank you.

  13. Bryan Kavanagh says:

    Good stuff, Catherine, tax the land, not people. The immediate problem, though, is that most people have not thought it through like you. There’s an enormous educative void out there. With the $80 billion state health and education shortfall, the punters believe there remains only one option now – to extend the GST. They don’t realise that an all-in state land tax is a far better alternative if we are to kick-start the economy and get the drones, the 1%, to pay their fair share. Extending the GST is more of the same regressivity as the budget has delivered whilst the rent-seekers continue to get the free ride.

  14. Charles Ponzi says:

    All we can do is spread the word and not take it lying down.

  15. Counterfiat says:

    Here’s something someone posted elsewhere:

    Vote for bankers – vote Liberal.
    Ofcourse they knew banker Turnbull was unelectable.
    Tony TROYHorse, all empty internally, filled the void with ravenous bankers.

    Rule corporations, corporations rule the inflation waves.
    Never, never never never, will you reach pension age.
    Drown the plebs, our profits will be saved.
    And forever, ever ever ever, fiat gearers (bankers clients) will sing our praise.

  16. Ageless says:

    Beautifully written and thought out. Congratulations Catherine. I particularly like “Without land, or the ability to use it, rent it, or buy it, we’re unable to do, or produce anything. We are by definition “poor.”

    This is a point so often missed especially by the left of politics. The landowners already know!

  17. gregcheryl says:

    This government seems to have a death wish.
    All seems so pointless without having a majority in the senate.

  18. 2big2fail says:

    Thanks Katherine for a well thought out article. I guess, the main question that comes to mind is how can we take this conversation to the mainstream media? Housing affordability is completely missing from mainstream media discussion of the budget. We need to get this discussion mainstream so that people can start exchanging ideas and perhaps then the next “Google” of politics is born..