This might not be everybody’s cup of tea, but there was some fascinating reading on economics and politics in last week’s media, and since I have nothing else for you, here it is in my blog:
Bernard Keane on Access Economics’ poor record on forecasts:
Then there was Access’s early 2009 warning that it would be “impossible to avoid a recession“. The Rudd government promptly did exactly that.
Michael Pascoe on why Abbott’s opposition to the Resources Rents (Mining) Tax is flawed:
The immediate test of whether a party is fit to govern is the minerals resources rent tax (MRRT). In economic terms, it’s a no-brainer, which is why the opposition’s stance is such a worry. Either there are no brains, or the leadership is so pathetically shallow that they are prepared to damage the country to get the keys to the Lodge.
Laurie Oakes agrees, and also discusses the Opposition’s stance on other issues:
Pointing to Australia’s Budget deficit, the Opposition Leader thundered: “Why is the Government planning to provide money it does not have to prop up the eurozone, which is the world’s biggest economy?”
ABBOTT knew – or should have known – that Australia’s contribution to the IMF would be in the form of a loan, with no impact on the Budget bottom line. In fact, it will earn interest.
8 replies on “And now for some economics and politics”
Before anyone thinks that the mining companies are willing to pay the tax, doesn’t anyone see anything wrong with that? They must have something to gain
This tax was created in a back room deal with the biggest mining companies and the government. Mining is a hugely capital intensive industry and this tax is looking at taxing 30% of profits over $50 million. Since the bigger companies already have much of their operations set up and paid for, it makes it harder for more competitors to enter the market and thus the biggest miners ultimately are the beneficiaries
And something that may be unrelated. Im only 17, currently doing my vce and just an idea. Do not take any note if this government saying were doing it for your children, its what they expect. It is absolute stupidity, we(or your children) aren’t idiots and we know the dire consequences of this governments actions. In a year level of around 150 about 20 support the labor party. Good luck
“This tax was created in a back room deal with the biggest mining companies and the government”
It was? If that were the case, why did the mining industry launch a multi-million dollar advertising campaign against it?
@Melbkid thanks for letting us know your 17 so your comments are in context. I think ppl are beginning to see through the smoke & mirrors of the opposition and interest groups like Clubs NSW and the Mining lobby, I think this government is trying to do what’s best for the country as it and the greens/independents see things.
The mining tax is a no-brainer, but the powerful lobby groups managed to swing public opinion (prols easily swayed by advertising) so we end up with half the solution from the Henry tax review because the government is trying to manage it’s popularity as well as deploy good policy.
I was reading a blog about moving to Australia which has a post “Five things that (still) surprise us about Australia” where ppl who have migrated here can’t believe that there are “Adverts against government policies “, I guess they are not common elsewhere?
http://www.mumsgone2aus.com/2011/07/05/five-things-that-still-surprise-us-about-australia/
I don’t think the coalition will cruise through the next election as we’ve been led to believe, sooner or later they will need to provide alternative policies, of course that won’t happen until the last days of the election.
i mentioned being 17 at the end, knowing that if i stated it earlier it would weaken my arguments would be dismissed by some whom may think were all a bunch of useless trouble making drinkers who wouldn’t know anything about the world around us
And Daniel. The back room deal was the rush by the government to make these mining companies quiet.
Originally the tax was suppose to be 40% of profits (under rudd) and stated by Henry Tax Review, then the mining companies launched advertising campaigns against it. So gillard rushed to silence them and put forward the 30% of profits proposal which saw miners withdraw advertising campaigns
melbkid is correct. i’m still waiting for my invite to chat with miss gillard and mr cameron about how much tax i’d like to pay.
@Melbkid Its true there were negotiations after Rudd was booted from the top job. However, the negotiations hardly made it harder for smaller companies, quite the opposite, as the point at which the tax “kicks in” was raised considerably during the negotiations.
“ABBOTT knew – or should have known – that Australia’s contribution to the IMF would be in the form of a loan, with no impact on the Budget bottom line. In fact, it will earn interest.”
Well, loaning money is providing it, isn’t it? And the issue is whether the money in the loan could be put to better use elsewhere — compensating for the Mining Tax, for instance, or the ludicrous Carbon Tax. Surely protecting the financial interests of Australians will pay off much more in the long run than getting our money back from Europe with interest — if we ever do: bear in mind that Greece has defaulted on half its debt already.
Good to see that the media is turning more of a questioning eye over the vitriol pumping out of Abbot the naysayer. I expect more substance to opposition policy than “I don’t like it because the Government likes it”.
@Jon Jermey: Yes, but loaning money is investing, not just spending, as long as you aren’t too speculative with the risks of default (eg. subprime mortgage crisis behind the GFC) – shouldn’t the Government be investing our money as well as spending? Loaning the money to the IMF should be a good spend. Not only do we look like a good global citizen lending a helping hand to bigger economies in their hour of need, but we should make a tidy little return on that investment. If the whole of Europe collapses and defaults like Greece may, the consequences will be worse for Australia than just the being the holder of bad debt. Let’s hope they don’t.