Tasmanian Alderman Leo Foley maintains an interesting calendar of land quotes.

But in studying historic events, land has become invisible. You see, that suits the 0.1% who run things.  It is also neo-classical economics’ response to the ideas of Henry George.

And doesn’t today’s economy reflect this deepening scandal?

As a member of the community activist group, GetUp! I went along with five others last night to meet with the ALP federal member for Bruce, Alan Griffin, at his electorate office. We represented the 2412 GetUp members in the electorate of Bruce.

All federal members are being canvassed on the issues GetUp’s 600,000 members voted last year to be their main concerns.

They were identified as:

–      real action on climate change

–      a fairer deal for asylum seekers

–      a more equitable tax system

–      independent media

The cumulative effect of this Australia-wide process will be interesting.

I had been selected to speak on tax reform, and, after introducing myself, my contribution was as follows:

1. A fairer tax system was voted GetUp’s biggest economics issue, but Productivity Commission inquiries and discussions on manufacturing and labour relations miss the point that tax systems that gave the wrong signals by fining workers and businesses and rewarding real estate speculation delivered us into this global financial collapse.

2. Our kids can’t afford a home, and virtually all sales are currently to investors – often overseas investors at our kids’ expense – but our politicians are reluctant to interfere with this hopeless situation.

3. In 2007, before the 2008 crash, I produced a study of real estate bubbles showing that since 1970 it has become fashionable to wind back property-based taxation, which used to help fund dams, bridges, highways and other infrastructure.

Today, we wonder how to fund infrastructure and we sell off our public assets for 30 years under PPP toll arrangements – and these are beginning to fail.  (What about ‘beneficiary pays’, instead of ‘user pays’?) For example, the new Brisbane-Gold Coast light rail has increased residential land values by up to $100,000, but this was not used to fund the project directly by capturing a small part of the uplift in values.  Compare this to the 1920s extension of the railway line from Darling to Glen Waverley, which was funded out of a ‘betterment’ rate applied to nearby properties.

4. The Henry Tax Review lists the 40% petroleum resource rent tax on profits we’ve had since 1987 as having no social cost, compared to royalties and crude oil taxes at a social cost of 70 cents in the dollar, and payroll taxes at 40 cents in the dollar. Therefore, Kevin Rudd’s original 40% resource super-profit tax on mining had excellent credentials. However, Tony Abbott gloats that he is removing the federal minerals resource rent tax, but leaving State mining royalties in place!

5. The Henry Tax Review also noted that 115 of Australia’s 125 taxes are most inefficient–they raise only 10% of revenue–and should be abolished.

6. Because of the mobility of labour and capital, Ken Henry saw the need for greater emphasis on mining and land taxes that cannot flee the country, and KPMG-Econotec modelling of the Henry Tax Review findings showed that, next to the petroleum resource rent tax, the most efficient taxes are municipal rates and land taxes. Under these, the super wealthy would pay their fair share.

SO, HOW CAN “GETUP” ASSIST YOU TO GET A FAIRER TAX SYSTEM, MR GRIFFIN?

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As each GetUp speaker provided a clear exposition of their respective topic, Alan Griffin proved to be a good and amiable listener, inserting his own comments into the discussions.

He noted the ALP is no longer in power and provided no assurances.

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As Victorian manufacturing goes further down the gurgler with the announced closure of Alcoa’s Point Henry aluminium smelter yesterday, Neil Mitchell sought responses from people on his radio program on 3AW today.

Nobody suggested that a crazy tax system that penalises productivity and rewards us for being parasites is at the root of our widening social and economic problems.

From The Henry Tax Review

“The re-emergence of the Asian region as a centre of world economic activity together with increasing globalisation, characterised by increasing mobility of capital and to a lesser extent labour, will have a further profound effect on how investment is taxed and will increase the need for tax and transfer policy settings that support productivity growth.”

“Around 90 per cent of Australian tax revenue is raised through only 10 out of some 125 different taxes that are currently levied on businesses and individuals.”

I listened in awe today as Prime Minister Tony Abbott recounted the deeds of Corporal Cameron Steward Baird that ended up getting him killed in Afghanistan.  Corporal Baird’s selfless actions clearly merited the award of the 100^th Victoria Cross, and one hopes his incredible bravery will provide some little consolation for his loss to his family and friends.

The award took me back to the bravery of the ANZACs at Gallipoli in WWI, which has come to be seen as the event that finally turned Australia into a nation.

How such a defeat in the face of the Turks defending their nation in what was basically a misguided imperial conflict made Australia a nation has always eluded me, but I note with satisfaction the reconciliation and respect between Turkey, Australia and New Zealand that has subsequently developed for each other over the action that took place  99 years ago at Gallipoli.

In my opinion, Australia can only be considered a nation when it is able to honour its first inhabitants who fought courageously to resist being dispossessed of their tribal lands.

The indigenous people of Australia still require a treaty arising from what amounted to frontier wars, and Australia needs to be able to treat their forebears not as terrorists, but to honour them as defenders of their country.

In this respect, Australia still needs to grow up and come of age.

Tony Abbott today showed ‘Closing the Gap’ is failing the aboriginal people of Australia.

Here’s why it’s failing: it doesn’t recognise the history of Europeans separating the indigenous people from their resources by sidelining them to the backblocks. The following preamble to the Australian Constitution would quickly repair this situation in the form of a practical economic treaty. Any treaty without this consideration is doomed to fail.

Necessary Preamble to the Australian Constitution

“As a treaty between the aboriginal people and subsequent settlers, we the citizens of Australia acknowledge the wrongs involved in the dispossession of the aboriginal peoples from their lands and natural resources, often by frontier wars. To rectify European-Australians’ commoditisation of aboriginal land and natural resources, we declare the income from land and natural resources to be the commonwealth, the natural source of the nation’s revenue, wherever exclusive possession has been granted to companies or individuals.

We declare all arbitrary tax imposts upon labour, thrift and industry must gradually be abolished in order to fulfil this revenue switch from labour and capital onto land and natural resources.

We finally understand ‘Closing the Gap’ is impossible unless we thus acknowledge the earth to be common property and the birthright of all people, and that bills purporting human rights must be invalid without this primary fiscal adjustment.”

Dear Janet Yellan,

As a bankster myself, I’d like to provide some friendly advice.  To keep screwing the American people–to keep them debt-laden and innocently in their place–here’s what you have to do.

1. Cosset the banks at ANY cost. That obviously involves the continuation of quantitative easing.
2. In turn, QE will maintain the share market at false highs. We can’t have it decline.  (That would denote failure in your job at the Fed.)
3. Don’t (i.e. do not) let any further steam go out of land prices across the nation, because that will put the sort of pressure on our banks that brought about the Great Recession in the first instance – and we can’t have a repeat of that.
4. If manufacturing and other non-FIRE sector businesses suffer as a consequence, so be it. You are simply continuing to do what the Fed does by reinforcing the tax system’s bias in favour of the more important FIRE sector (at the expense of productivity).
5. Finally, keep mentioning “the improving American economy”.  That will imbue a sense of confidence in our captive clients, including federal, state and local governments.
6. You will note Australian banks continue to make record profits by staying on-message.

Yours faithfully,

–      Bryan (Bankster) Kavanagh

Ruinous trust in land speculation as the route to wealth has led to expensive houses and inefficient taxes but, far worse, it ended up destabilising the entire global economy.

–          Martin Wolf, chief economics commentator, Financial Times, 8 July 2010

Tony Abbott has called a Royal Commission to investigate alleged union corruption.

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The methods by which a trade union can alone act, are necessarily destructive; its organization is necessarily tyrannical.  – Henry George

Although there’s far more to an economy than interest rate policy, the RBA doesn’t have  happy history with the cash rate.

Stupidity of taxing production

If men want more wealth, why don’t they get more wealth? If we, as a people, want more wealth (and certainly ninety-nine out of every hundred Americans do want more wealth), why are some suffering from the want of employment? Others are at work without making a living. Meanwhile, ninety-nine out of a hundred of the people have some legitimate desire that they would like to gratify. Well, in the first place, if we want more wealth – if we call that country prosperous which is increasing in wealth – is it not a piece of stupidity that we should tax men for producing wealth? Yet that is what we are doing today.

“Our Land and Land Policy”, Henry George, 1871