Talk About Lack of Vision

Posted on October 16th, 2007 in Driving Emotion,Opinion by Julian Edgar

OK, here in Australia it’s the first couple of days into the Federal election campaign and I am already appalled.

Yesterday the Liberal/National coalition Government made, as its first election promise, a pledge that personal tax cuts would be instituted across the board. In fact, no less than AUD$34 billion of tax cuts.

Commentators immediately suggested that in their forthcoming tax policy, the Labour party opposition will probably be forced to match this promise.

Am I the only voter who thinks that this is a AUD$34 billion waste of money? Sure it’s nice for the electorate to have a few more dollars in their pockets but in this time of near record unemployment and low inflation, now is not when we should be reducing the tax take. Instead we should be doing something real and useful with the funds that the country as a whole has available.

Think what that thirty-four billion dollars could do.

It could vastly improve our road network. And ‘vastly’ is a massive understatement.

It could invest hugely in areas in which Australia used to be a leader, areas that our climate lends itself to, technologies that will be in increasing worldwide demand. Solar energy is one obvious candidate: in solar water heating and photo-voltaic cell technologies, Australia was once a leader.

It could invest itself in revolutionising the local car industry to produce cars that would be in world-wide demand.

It could universally introduce zero consumer cost broad-band, in so doing allowing far more to tele-commute to work.

That thirty four billion dollars could be used to address what are surely the most pressing problems facing Australia: potable water supply and energy production. Instead we have state governments struggling on an ad-hoc basis to provide infrastructure that is geared solely to a short-term election cycle. Where are the federal government visionary schemes to transform our system of water harvesting, water recycling and water conservation? Where’s the federal government lead in moving away from coal burning power stations that provide nearly all of Australia’s base-load electricity generating capabilities?

Instead, the election promise is about how many extra dollars you’ll have to buy a huge flat-screen TV…

Note: comments that don’t address the ideas covered here (eg comments that simply say one party is better than the other, or that all politicians are idiots, etc) will be deleted.

5 Responses to 'Talk About Lack of Vision'

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  1. Richard said,

    on October 16th, 2007 at 11:07 am

    It’s simple. People don’t trust politicians to deliver on a long term promise. Federal governments don’t trust State governments to spend the money they give them.

    Given all the problems with PPP and infrastructure in NSW I tend to agree. Leave it to governments to do (with our money) and it takes twice as long and four times the cost.

    At a federal level it would make more sense to give tax credits etc to companies willing to undertake large scale infrastructure/research projects. Let them take the risks and the profits. I think that is more likely to achieve success.

    Otherwise you are asking ministers/governments to make decisions on what is the right way forward. People would then complain about pork barrelling etc.

    The other point you fail to mention is that the surplus can handle tax reduction AND infrastructure spend. I seem to remember a $2.4B injection into rebuilding the Pacific Hwy.

  2. Leon said,

    on October 16th, 2007 at 12:36 pm

    Australia does still lead the world in many fields of solar technoogy, however that lead is a research based lead not a market lead. Australian researchers at ANU are are responsible for Big dish solar thermal technology as well as Sliver solar cells and Combined Hot Water and Power (CHAPS) Systems. These are world leading technologies. Dye-sensitized solar technology is also has a world leader in R&D in Australia. However the market for all of these technologies is currently overseas and thats where the sales are/will be being made (even if most of these are deing commercialised in Australia).

    Australia is addicted to Coal power and the shift away from it is going to be very very tough for any leader. There are a lot of votes and money in mining and energy industries which are already reliant on coal.

  3. doctorpat said,

    on October 16th, 2007 at 1:10 pm

    Maybe not all politicians are idiots, but a lot (maybe a majority) of the population thinks that they are.

    And half the population voted against the government (any government) anyway.

    So do we believe that a government can spent 34 billion dollars and do any good with it? It will spend the money to please the voters. The same voters who would spend it on big TVs and swimming pools.

    So, we’ll end up with the public, government provided equivalent of TVs and swimming pools.

    Say fireworks displays and mass sporting events.

    Our governments have shown very little ability to develop high technology industries and long term infrastructure planning, and few voters would believe them if they announced that they were going to start.

  4. Michael Breid said,

    on October 16th, 2007 at 3:23 pm

    Infrastructure indeed! I was ranting 35 years ago that we should invest in 4 lane roads right around Australia. How much does it cost transportation to slow traffic down to 50kph on our main highway to go through every little town on the map? How many accidents are caused by impatient drivers trying to overtake slower vehicles where it’s not possible?
    And then we could get going on water management. I think we might be able to feed the world if we could irrigate the outback with some of the water from the tropics. After all, Southern California irrigates with water from Canada.
    so I’m with you! Raise the taxes when times are good and invest in our future!

  5. Marty said,

    on October 16th, 2007 at 7:19 pm

    there are at least two voters who think its a waste of money, its easy to get clouded by your own personal circumstances but i think it is very important to take into account how these decisions will affect the future. While $35 a week in my pocket now might be close to 10% of my income, i don’t plan to keep it that way, i will continue to innovate and think ahead to improve my situation so why can’t the government do the same?

  6. doctorpat said,

    on October 17th, 2007 at 9:52 am

    Note that I don’t think Julian’s plan is a bad one. I just think that any political party who promised to implement it:
    1. Would find it extremely difficult to do politically, as various interest groups would all try to grab a slice of pie and push their own agendas, with the population switching back and forth to whichever idea is in the media at the time. Hence any long term planning is doomed to be diverted.
    2. Even if the government WAS devoted to pushing through with the long term plan, nobody would believe that item 1 above wouldn’t happen.

  7. Gordon Drennan said,

    on October 17th, 2007 at 1:56 pm

    ANU’s Australian Survey of Social Attitudes has tracked exactly this issue of whether we collectively want less tax or more government spending. Their surveys show that from the early 70s up until the mid-90s more and more people wanted less tax. But that turned around dramatically, with each successive poll showing more and more people wanting more spending rather than less tax. At last count half of us want more spending, a quarter think its about right, and a quarter want less tax. So John Howard is out of step with public opinion, and if Kevin “me too” Rudd copies Howard’s $35B tax cuts he’ll be out of step with public opinion too. But clearly what the public want is not what the people who tell the mainstream media what to say want.

  8. Bev Guy said,

    on October 18th, 2007 at 1:06 am

    The 34 billion is a token offering to appease the masses, a common enough tactic during election campaigns! Australia has a complex, costly and inefficient tax system that desperately needs overhauling. Speak to any accountant, they will tell you that they have enough trouble interpreting the ever increasing volume of taxation legislation; the average tax payer has no chance!
    A few years ago, talking about taxation issues with an expat Australian living in Singapore, he mentioned that he’d just completed his tax return and that it took two minutes. He had simply logged onto the Taxation website, entered his salary in the box provided and as there was a flat 17% rate of tax, was immediately notified of his tax obligation. He was then given the option of paying monthly or in a lump sum. After ticking monthly and entering his bank account details, he was finished…until next year! How top heavy is our system and how much does it cost to implement?
    I’d forgo the tax cuts if they were used to overhaul the taxation system and ensure it is simple, transparent and fair! It doesn’t matter which party gets in, it is unlikely to happen.

  9. Julian Edgar said,

    on November 20th, 2007 at 6:48 pm

  10. Julian Edgar said,

    on November 29th, 2007 at 6:28 am

  11. Bev Guy said,

    on November 29th, 2007 at 9:06 pm

    Steve Biddulph’s article is excellent! I voted labour for the first time in my life!

  12. Marty said,

    on November 29th, 2007 at 10:07 pm

    i too found that article and forwarded it to many. i don’t align myself with any particular party after reading about politics in australia in general i think that Steve’s article is a great insight, it will be interesting to read it again in a few years time to see how accurate he is! or maybe i’ll land that lucrative job and be driving an aston and won’t care !