WHY ARE WE COPYING OBVIOUSLY FAILED ECONOMIC MEASURES?

As we know, the people of Japan and their economy have been languishing ever since their massive real estate bubble burst in 1989. That’s now twenty-five years.

The Japanese Reserve Bank has been calling the wrong tune for far too long, and a succession of prime ministers since that time have obviously been under its spell, the latest Shinzo Abe having done a complete turnabout presumably at the Bank’s behest.

Even before Australia’s subsequent (but equally massive) land price bubble has burst, our economy appears to be in deep do-dos, the Abbott-Hockey government proving itself to be every bit as clueless at effective policymaking as the Rudd-Swan-Gillard-Swan-Rudd-Bowen governments.

It’s looking remarkably likely that we’re going to prove as inept as Japan. We’re already witnessing a weirdly mainstream belief emerge that Australia needs to extend its GST, as did Prime Minister Abe in Japan (and John Key in New Zealand). Have we learnt nothing at all from the Japanese experience?

Europe remains at the very least in a fiscal torpor, whilst the Americans have the luxury of printing the world’s reserve currency like there’s no tomorrow to effect their self-styled “recovery” that appears to be nothing of the sort.

What hasn’t been tried that ought to be tried?

  1. Slashing, really slashing, indirect taxes, NOT extending them! While we’re at it, slash direct taxes, too, because how can reducing people’s purchasing power bring about economic recovery?
  2. Bail out people, not the banks (as in the US and Europe) because there’s too much private debt and taxes dampening demand.
  3. Look to economic rents, not taxes, for the necessary revenue.

“Australia’s Future Tax System” (The Henry Tax Review) recommended points 1 and 3 above, but as this did not square with the nonsense that Japan, Europe and the US have undertaken, Australian policymakers have been crass enough to totally ignore it.

How absolutely perverse of us that we prefer to follow proven failed measures taken by Japan, Europe and the US instead of Australia’s own thoroughgoing inquiry into reforming an anti-productive tax regime!

Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

END THE LAND BUST CYCLE

(Had to get ‘bust’ in there.)

Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

FORGET THE 1%, IT’S THE 0.1%

http://www.economist.com/news/finance-and-economics/21631129-it-001-who-are-really-getting-ahead-america-forget-1

…. as we’ve said here numerous times (if you’d like to do a search of “0.1%”).

Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

MICHAEL HUDSON DISPUTES GOVERNMENT DEBT BAD, PRIVATE DEBT GOOD


Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

TOLLS, TOLLS, TOLLS, TOLLS

Herald Sun on East West Link

THE Napthine Government sensationally considered increasing tolls on CityLink and East Link, and introducing tolls on the Eastern Freeway and Tullamarine Freeway, in order to make the $6.8 billion East West Link financially ­viable.

But don’t forget you’ve now got engineers suggesting the new Victorian Andrews government should toll the 50 rail overpasses Labor will be constructing in lieu of the East West Link.

So, both sides are locked into this tolling mentality.

What forward thinking our predecessors had in capturing some of the uplift in land values that capital works provided to land owners! Although our forebears understood and accepted the principle, politicians of all persuasions now run scared of capturing part of the windfall gains property owners receive from infrastructure. It’s apparently too difficult to re-educate people in order to resurrect this excellent idea.

It seems escalating property values are sacrosanct. User-pays tolls–not beneficiary pays–must apply, everywhere.

And, with these and other anti-productive taxes, we wonder why world economies are imploding.  Really?

Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

EXPLANATION OF RENT

HAT-TIP TO EARTHSHARING.ORG

Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

IMF AND HOUSING UNAFFORDABILITY

Oz REhttp://www.imf.org/external/research/housing/

Why don’t you finish off, instead of simply showing the problem graphically, you IMF guys?  Wouldn’t greater public land value capture lead to lower land prices and greater economic stability?  Wasn’t it gross property speculation got us here?

In other words, capture economic rents instead of taxes to get things working again – as advocated by the Henry Tax Review – instead of letting the world continue to stultify and suffer like this.

It’s simple, so get to it, IMF!  Don’t be drones!

Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

PROPERTY TAX V. LAND TAX


Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

THE 1% FIGHT TO RETAIN THEIR GOVERNMENT-GRANTED PRIVILEGES

And, having the money, they can find plenty of stooges to press their unsupportable case.

http://www.macrobusiness.com.au/2014/12/judith-sloans-soaring-negative-gearing-delusion/

Posted in The GFC can be ended by capturing economic rents for revenue | Comments Off

PROSPER AUSTRALIA ADVISES NEW VICTORIAN GOVERNMENT …

…. HOW TO FUND THE PROPOSED UNDERGROUND RAIL LINK

Posted in The GFC can be ended by capturing economic rents for revenue | 2 Comments

Copyright © 2009 WordPress › Redesigned by Mitch O'Brian › Based on Shape.