7 November 2022

Steady as she goes won't cut it, Albo. Get on with it!

| Ian Bushnell
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Jim Chalmers

Jim Chalmers preparing his first budget. Photo: Supplied.

There are signs that the Albanese Government is too cautious and timid to tackle the big issues facing Australians as they head towards Christmas with shrinking pay packets and soaring bills.

In case you haven’t heard, we’re facing tough times.

Treasurer Jim Chalmers won’t stop saying how frank he needs to be with Australians about the economic and budget challenges ahead.

The Reserve Bank, which told us there wouldn’t be any interest rate rises until 2024, has just unleashed its seventh straight rise of the year and warned Australians of a couple of tough years ahead.

Is that so?

It expects inflation to stick around longer than expected, requiring it to continue choking the economy so it will return to the goldilocks range of 2 to 3 per cent in, say, 2025.

We can only hope it is as wrong as it was on its previous forecasts.

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The only impact the war on inflation seems to be having is on house prices, but when the other big components of inflation – food, fuel and energy – are beyond the hapless consumer’s control, one wonders whether jacking up rates will make any difference at all, other than to tank the economy.

The weather, big oil and the Russians are no respecters of interest rates or governments, and people still have to eat and get to work.

The Ukraine war has made a mess of energy bills. Still, the sector was already a basket case thanks to the short-sightedness of previous governments when it came to managing the country’s gas exports, effectively making us beggars in our own land.

Not to mention a lost decade when they should have been managing the transition to a new energy system.

Rest assured, though, the adults are now in charge, and they’re working on it.

Just be patient.

But the budget has come and gone, with little to show for it.

Except for a dire warning about ever-rising energy bills as coal and gas exporters rake it in.

Australians with mortgages brace monthly for another whack, while those without face rent rises in an insecure market. Those waiting for a home to be built fret the dream will turn into a nightmare with every rate rise.

Just be patient.

Mr Chalmers floats all kinds of possibilities and worries about interfering in markets but won’t be frank enough with us to say if you want services and a balanced budget, we have to pay, or at least some of us, more tax.

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Australians have been patient. They elected a Labor government to give the country a new direction, but we’re still waiting.

A change of tone or style is not enough.

Australians expect the government, no longer new, to show leadership and take action.

There is strong support for it to impose a windfall tax on gas and coal producers and for a gas reservation policy like Western Australia has so Australians, particularly industry, don’t have to pay the same price as in Europe for our own gas.

The electricity market, such as it is, is kaput, so the government should step in to ensure prices remain affordable and the lights stay on while accelerating the move to renewables.

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Reports are that the government is again looking at tax concessions. They should stop just looking and dust off the 2019 election policies on franking credits and negative gearing and capital gains tax, which would save the government billions and help stabilise the housing market.

Because no matter what the scare campaigns were, they were right then and even more so now.

They should also scrap the stage 3 tax cuts, which are unaffordable, make the system even more inequitable and are morally wrong when someone on JobSeeker or a pension is given a pittance to live on.

It’s time a government stopped pandering to sectional interest groups, scrapped handouts to people who don’t need them and built a tax system fit for a modern social democratic nation instead of peddling fairy tales about the trickle-down benefits of a low-tax economy.

Prime Minister Albanese and Mr Chalmers need to drop the soothing words, stop blaming their predecessors and ignore the headlines. They need to sound the trumpets and do something because the country is in a crisis and patience has run out. And they don’t have much time to fix things before another election is breathing down their neck.

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HiddenDragon9:00 pm 07 Nov 22

Sorry, Ian, but the scowling young working class warrior in the denim jacket in the now famous (and heavily re-interpreted) photo with then PM Bob Hawke left the room a long time ago and has been replaced by a gentrified, inner-urban, S.N.A.G. with a property portfolio worth millions.

He’s not going to shake up the system which has done so well by him – likewise the collection of careerists and corporatists who surround him in the cabinet and the outer ministry.

As things stand, the best that might be hoped for is a less bold, less cohesive, and less skillfully sold version of the social contract offered by Hawke, Keating and Kelty and largely embodied in the Accord process. One way or another, it won’t be enough to meet present and emerging circumstances and this government will fail – not so much in the way that Whitlam was seen to do, but perhaps more like the earnest technocrats of the Carter administration in the US.

I notice you completely ignored the main driver of inflation, large corporations boosting the profit margins, by increasing prices.
As for the Stage 3 Tax Cuts, they’re two years away. All the media hype is just that hype.
Labor inherited a way larger pile of excrement from the LNP, than anyone could’ve imagined. It goes way beyond $1 Trillion in debt. Almost six months in, and they’re still finding hidden spending, outside the budget.

Labor have done more in under six months, than scomo did in over three years.

Capital Retro11:30 am 08 Nov 22

Remember how the media and Labor criticized Morrison for his initial decision not to attend that COP thing in Scotland? He went anyhow.

Haven’t seen Albo at the current COP in Egypt and the media are saying what?

devils_advocate12:42 pm 07 Nov 22

For those in the know, Treasury’s income tax modelling always assumes “no behavioural change”. In reality having to hand over 50 cents out of each additional dollar prompts people to:
1) change tax jurisdictions (eg go work in Singapore)
2)engage in tax minimisation (eg negative gearing)
3) withdraw their services from the economy either partly or wholly (eg semi retire or work part time)
4) spend longer at home when kids arrive on the scene

And many other rational responses. Leisure time has a value and those who have worked hard to advance themselves have the means to buy it through reducing their labour output

I’m wondering if Stan Dukic has the ability to think past the puerile!

The Albanase government has a great opportunity for positive change, to reform the tax system so that it is fair and equitable to all Australians. The Labor government replaced a corrupt Liberal government. Labor has been elected to get the country back on track by fixing the over $1 billion debt left by the previous government. My mortgage payments have increased significantly but I hate to think how other people are coping with larger mortgages and those renting. Not to mention those many families and single mothers living below the poverty line trying to survive on a pension. The government needs a total rethink on tax cuts to the wealthy and those who least need it. The stage 3 tax cuts are simply unaffordable! Tax big business and the mining companies who are mostly foreign owned. Don’t get me started on franking credits! Franking credits is open to rorting and crippling the country, costing more than health and education combined. These costs are growing! Just get on with the job of creating a fairer tax system Labor!

Jack D – would that fairer tax system of yours encompass taxing big unions, with millions in the bank put away for election war chests, or are you referring to Mum and Dad small businesses

Oh election war chests from the Union to Labor!! Don’t get too smug and hypocritical about funding from the union to the Labor party Futureproof! Your one-eyed analysis reminds me of an investigation in Victoria a few years ago which found that clubs linked to the Liberal party used special fund-raising techniques to avoid disclosure of millions of dollars in contributions to the party! Let’s not forget the humiliation suffered by ClubsACT in the 2016 election. ClubsACT received significant funding from their union affiliated clubs and squandered many thousands of dollars of members’ contributions into Liberal party coffers . These failed attempts to unseat Labor and the Greens put the club into dire financial strife. All this so that the Liberals would be elected and overturn Labor’s gambling and poker machine reforms. A 2017 Assembly inquiry found ClubsACT spent $56,190.20 of members’ contributions on election campaign expenditure. Shadow Minister for Gaming and Racing Mark Parton is a strong supporter of clubs and gambling in the ACT. Mr Parton is also a strong supporter of ClubsACT. Always the humorist, Mr Parton claims that Canberrans are more addicted to chocolate than gambling!

Jack, can I ask a favour?

When you place a comment as long as this one above on here, can you please use paragraphs? I feel like I’m reading a draft manifesto from Ted Kaczynski.

Anyway, do you have any proof that Mr Parton is incorrect? As a chocolate addict myself, I find the lack of rehabilitative facilities for my addiction a poor reflection of the wider community (not even a CA – Chocoholics Anonymous).

So until you walk a mile in my shoes you will never know the pain or the humiliation chocoholics, like me, face everyday 😢

Well I’m damned if I do and damned if I don’t! I had a university professor tell me once to cut down on my paragraphs in essays and now I’m told I don’t put in enough! I’m not sure about being compared to Ted Kaczynski! A maths professor, prodigy and some claim a genius! He even inspired multiple artistic works. I certainly have never been known for my genius in maths!!

“I had a university professor” Well good on you. Oh also, it was Labor and the Greens egging on Morrison to keep jobkeeper longer than it should have. Have you forgotten that? Next time you talk about debt, just look up Hansard for Albo et al demading jobkeeper remain

devils_advocate9:30 am 07 Nov 22

Australia’s income tax rates are among the most punitive in the world.

If marginal tax rates had been indexed the top rate would not kick in until around $260,000.

Not only should the stage 3 cuts remain, they should reinstate indexation and backdate the marginal rates to when it was removed.

Maybe then strategies like “negative gearing” would have less appeal for those that work hard and earn a decent income

“They should also scrap the stage 3 tax cuts, which are unaffordable, make the system even more inequitable and are morally wrong when someone on JobSeeker or a pension is given a pittance to live on.”

It’s funny to see taking less off someone else described as being “unaffordable”.

The reality is, Australia relies far too heavily on income taxes for revenue and through bracket creep, the government has received ever higher amounts of tax through stealth.

Whilst you can argue about some of the flatness of the system, the stage 3 tax cuts, still see people with higher incomes paying far more tax than those on lower incomes.

There are far more relevant structural issues around the tax system that the government should be focused on than the “unaffordability” of giving workers some of their own money back.

And perhaps they could also look at stopping spending like drunken sailors for once? The growth in expenditure is enormous and needs to be reined in for the sustainability of the budget over the long term

“the stage 3 tax cuts, still see people with higher incomes paying far more tax than those on lower incomes. ”
Ask Mike Cannon-Brookes about that

You know that Mike Cannon Brooke’s isn’t his company right?

Although yes, you’ve identified one of the structural areas that I mention above. Company tax avoidance, which is rife globally.

We’re agreeing too much lately Chewy!!!!! When I do consulting jobs in Canberra I have to pay GST, Payroll tax and then the usual income tax on top of each other. Companies and people earning from investments get off easy in Australian tax terms when compared to anyone who provides an income earning related service.

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