Letters on the US Presidential Election and 'Small Government' in Australia

above: Left-wing US Presidential Candidate Bernie Sanders

 

The following are another series of letters to The Age and to the Herald Sun ; addressing topics as diverse as the US Presidential election; to Richard Denniss on economic reform;  a response to Peter Costello on ‘small government’;  on the threat of ‘elder abuse’ by government;  and the case against austerity!  Unfortunately the clear majority were not published.

Dr Tristan Ewins

Richard Denniss on Economic Reform

Richard Denniss (‘The Age’, 15/2) makes a compelling argument regarding the real nature of the social choices we need to make, and the social priorities we need to set.  Are lower corporate and personal income tax rates, as well as other concessions and subsidies for the well-off really a greater priority than quality, accessible state education ; a fair welfare system which is sustainable for those depending on it; social insurance for the disabled and the aged ; and comprehensive public health which is truly responsive to human need?  Peter Martin (15/2) makes the point that the top 10% consider themselves ‘battlers’, whereas in fact they are amidst the truly wealthy and the upper middle class. We cannot afford social services, welfare, social insurance and public infrastructure without a genuinely progressive tax mix.  And we must not be scared to put the arguments for redistribution and higher social spending – without which the minimum human and social needs of a great many Australians would not be met.  This election the progressive parties should be aiming to increase social expenditure by at least 2.5% of GDP (or $40 billion in a $1.6 Trillion economy) rather than parrot conservative mantras on ‘cutting expenditure’.

Responding to Peter Costello on 'Small Government'

Peter Costello (Herald-Sun 16/2) argues  “spending, not tax, is our biggest problem”.   Yet Australia’s public spending is low by OECD comparisons. The problem is that ‘small government’ imposes a ‘false economy’.  Some social needs are non-negotiable.  Health, Education, Aged Care, pensions for the vulnerable and for those who have earned it through a lifetime of work.  Crucially: In these fields ‘collective consumption’ via tax actually gives us a better deal as taxpayers than we would receive as private consumers.  To illustrate – in their book “Governomics  - Can We Afford Small Government?’ Miriam Lyons and Ian McAuley argue that whereas ‘high taxing’ and ‘high spending’ Nordic countries “contain health costs to 9 per cent of GDP”, in the US the figure is 18% despite only 40% coverage.   Australia’s Medicare is somewhere in the middle: It is an effective universal coverage scheme – but neglect and under-funding leave us ahead of the US but behind the Nordics.  So even with progressive tax and higher social expenditure these policies can actually get costs down as a proportion of GDP, and in the process free up a greater portion of the economy for ‘negotiable’ needs (eg: entertainment, holidays) which improve our quality of life. 

Continuing the Argument against 'small government'

Conservatives are arguing Turnbull must “slash government spending”.  But where would that come from?  The unemployed live in such poverty it interferes with their ability to seek work. The Disabled already experience poverty through no fault of their own.  Student poverty forces mainly young people to seek out work that actually prevents them from getting the most out of their study.   The Aged are forced to sell their houses to access sub-standard Aged Care even when they are from a working-class background.  Waiting lists are spiralling out of control in public health ; and we have the threat of a permanently two-tiered Education system which disadvantages those unable to afford private schooling.  Mental health is neglected and many mentally-ill can expect to die 25 years younger on average.   There is insufficient public money for infrastructure and privatisation passes on added costs that hurt the broader economy.  Public housing could increase demand and make housing affordable for more families.  So in fact more public money is needed – not less.  AND the deficit must be brought under control as well.  Only PROGRESSIVE tax reform (not the GST) can tackle all these crises fairly.  Cutting savagely is not the answer.

Meanwhile on Elder Abuse by the Federal Government!:

Christine Long (‘the Age’ 24/2/16) provides an exposition on elder abuse, usually at the hands of relatives.  Yet the worst elder abuse and negligence comes as a consequence of the actions (and otherwise negligence) of the Federal Government.   Nursing homes lack staff to resident ratios, and what is more there is no provision for a registered nurse on the premises 24/7.  Indeed nursing homes are often akin to ‘warehouses for old people’. There is little or no mental stimulation or diversity in environment.  Lack of staff means residents do not always eat, and some are left in their own excrement for protracted periods for the same reason.  What is more, onerous user-pays mechanisms are forced upon working class families who may have struggled their entire lives to afford a home.  User pays aged care is akin to regressive tax – but much worse even than the GST.  For quality of life in old age other reforms are also necessary.  A significant increase in the Aged Pension.  Free public transport.  Taxi vouchers, and social gatherings to cater for all interests.  Programs to combat loneliness and the likelihood of suicide.  A National Aged Care Insurance Scheme would be a great place to start.

Responding on the US Presidential Campaign: Bernie Sanders' Prospects

 

Rita Panahi  (Herald-Sun, 15/2) decries US Presidential Candidate Bernie Sanders as “An ageing socialist who wants to raise existing taxes and introduce a bunch of new ones.”   The unspoken assumptions, here, are that small government is un-contestable, and redistribution unthinkable.  The Herald-Sun (15/2) was also concerned that what are probably the top 10 per cent of families live ‘pay-check to pay-check’ on $200,000 a year and more to maintain their lifestyles.  But according to the ABS  the average pre-tax individual wage in November 2013 was $57,980. And many truly battled on close-to-minimum wage: cleaners, skilled child-care workers, aged care workers, retail, hospitality and tourism workers.  In 2015 the minimum full-time wage was barely $650/week.  So redistribution is fair for many reasons.   Arguably everyone should have minimum rights to social inclusion, shelter, nutrition, education, and health care.  Best provided through the social wage, social insurance and various social services which demand progressive tax as ‘the price we pay for civilization’.  But pay is also based on ‘demand and supply’ in the labour market, and some workers’ industrial strength. Those mechanisms do not guarantee fairness.  You don’t get fairness and human decency without redistribution including services, welfare, public infrastructure and progressive tax.

Meanwhile:

Julie Szego (‘The Age’ 25/2) infers that women supporting Bernie Sanders in the US Presidential Election is not the ‘feminist choice’.  Underlying this is the assumption that identity is privileged over broader outcomes and over ideology . But if Sanders succeeded in winning free universal health care women would stand to gain as women – exactly because women are otherwise disadvantaged financially due to the exploitation of feminised professions, and due to women’s interrupted working lives.  Secondly, if Sanders raised the minimum wage this also would help the most exploited women in those same feminised professions.  Whereas Hilary Clinton can be seen as supporting a ‘liberal feminist agenda’ Sanders agenda ought appeal to ‘socialist feminists’  concerned also with class, and with the inequalities even between women themselves.   In this context it would not be ‘a betrayal of feminism’ to support Sanders.  Modern progressive politics needs to be based on reciprocal solidarity between human beings against oppression, exploitation, subordination and domination.  Here gender does not ‘trump’ other issues any more than those issues (eg: class) ‘trump’ gender. The agenda is for us all ‘to see the struggle through to the end’ with nothing less than ‘full human liberation’ as the aim.

 

From Privatisation to the GST - Letters of Relevance to Labor

Above:  South Australian Labor Premier Jay Weatherill has Upset an Awful Lot of People in the ALP with his Position on the GST!

Dr Tristan Ewins


Comrades and others; The following are a series of letters I've written over the past couple of weeks - in the hope of being published in The Age, The Herald-Sun, The Saturday Paper...  I'm hoping by republishing them here I can spur further debate.  Topics covered include 'How Federal Labor Must Respond to Jay Weatherrill on the GST', 'Privatisation Now and Then', 'the Holocaust and Cold War Atrocities - Never Forget',  'Why Isn't Shorten Cutting Through?', 'Infrastructure and Population'.  Most of the letters were never published debate here could help make up for that I think! :-)

Privatisation Doesn't Make Sense - Never did make Sense!

The Herald-Sun (27/1) makes a point of the fact the Liberal NSW Liberal Government will have $20 billion to spend following privatisation of electricity.  But it ignores the associated cost of this privatisation.  To pay for private dividends and corporate salaries increased structural costs will be passed on to consumers in full.  Energy will be more expensive – and that includes businesses as well as voters.  Dividends from the energy sector will also be lost to NSW voters – probably forever.  To get a picture of this: The Commonwealth Bank privatisation brought in about $7.8 billion (the total for the sale of the entire business!!!   )after being privatised by the Keating Labor Government.  But in 2015 the Commonwealth Bank registered a PROFIT (for only one year) of over $9 billion!  Meanwhile the Federal Government is having to pay Telstra several billions to access the very pits and wires that were privatised under John Howard.  How has any of this ever been in the public interest?

Remember the Holocaust - and ALL other Atrocities - So they are never repeated

Dvir Abramovich (Herald-Sun 27/1)  makes some crucial points about teaching young people of the dangers of hatred and prejudice, as epitomised most horrifically by the Holocaust, and the associated industrial scale murder and persecution of Jews, Poles, Russians, Roma, the disabled, and political dissidents. (mainly Leftists)  Such a public education program could be incorporated into a broader critical/active civics and citizenship curriculum reform agenda.  That is: reform the curriculum to empower all students to understand their rights and interests; to commit politically on the basis of their interests and acquired values; and to participate deeply in a truly and meaningfully pluralist democracy.  He also mentions Cambodia, Bosnia, Rwanda and others.  But one aspect that he neglected (unintentionally I believe) was the record of atrocities on the ‘anti-Communist’ side during the Cold War.  Over half a million leftists and trade unionists were murdered in Indonesia in 1965-66. And genocidal attacks during Guatemala’s civil war claimed between 200,000 and 300,000. As well as political mass murders in El Salvador, Nicaragua and elsewhere. Truly we must remember ALL of history’s shameful passages that we do not repeat them.  And that includes those committed ostensibly by ‘our side’. 

Why Isn't Shorten 'Cutting Through'?  And how can he change this?

Mark Kenny (28/1) argues Bill Shorten has failed to cut through since the elevation of Malcolm Turnbull as PM.  Yet the Liberal Party stands on the verge of another bout of bitter austerity: of the proportions which brought former Treasurer, Joe Hockey , undone.  For too long Labor has pinned its fortunes mainly to ‘socially liberal’ issues like Equal Marriage: neglecting robust social and distributive justice policies.  Hence the ‘socially liberal’ but ‘economically neo-liberal’ Turnbull has capitalised on the prevalent discourse.  Labor needs to change the prevalent discourse – and quick.  Labor’s strong endorsement of Gonski –  $3 billion on average a year - may show that Labor strategists are starting to learn their lesson. Other options could include more robust reform of superannuation concessions for the well off.  Superannuation concessions may cost taxpayers $50 billion/year by 2019, and Labor should be able to shave $20 billion of that from the well-off. Other areas of tax reform could include no further Company Tax cuts; gradually rescind Dividend Imputation; index the bottom two income tax brackets for fairness.  That could pay for a National Aged Care Social Insurance Scheme, reform of pensions and more, while improving Labor’s economic credentials, reining in the deficit.

The Infrastructure Crisis and Population: A Response to a Herald-Sun Reader

 

Nola Martin (Herald-Sun, 1/2) blames the transport infrastructure crisis – crowded trains – on overpopulation. Increased population has good and bad consequences.  On one side we will run into difficulty if schools, hospitals, roads, public transport – fail to keep up with population.  On the other hand higher population creates ‘economies of scale’ in the public service, defence and other areas. (ie: we can get away with paying proportionately less there)  But the real problem is that public investment in infrastructure and services – like roads – is not ‘keeping up’ on account of ‘corporate welfare’ and subsidies for the well-off.  Company Tax cuts mean corporations aren’t paying for the infrastructure they benefit from.  And superannuation concessions for the well-off might cost taxpayers $50 billion by 2019 according to Richard Denniss of the Australia Institute.  When there’s not enough public money for infrastructure like roads this also leads to privatisation.  The problem here is since the private sector cannot borrow as cheaply as the public sector, and must pay dividends to shareholders,  the increased ‘cost structures’ are passed on – hurting the entire economy.  But as the Federal Election approaches Malcolm Turnbull is considering more tax cuts. (eg: Company Tax)  When will we learn our lesson?

SA Premier Jay Weatherill and the Debate on the GST; And the 'Revenue Problem' for Health and Education

Regarding his discussion of raising the GST; On the positive side at least South Australian Labor Premier Jay Weatherill IS saying there’s a revenue problem we have and not a spending problem. It’s good to actually confront that issue - and to prioritise health and education. The problem is that he's undermining Shorten on the GST – which could be crucial in the coming election. The best reply Shorten can come up with is promising to address BOTH the revenue problem and the Health crisis - including Aged Care. There are a host of possible measures. Hit superannuation concessions. Gradually rescind dividend imputation. Reform capital gains tax concessions. Rescind negative gearing. Restructure and increase the Medicare Levy. DON'T cut Company Tax.  Shorten has options! Outlining those options NOW - AS OPPOSED TO THE GST can answer Jay Weatherill's concerns re: 'the revenue problem'.   And we can then enjoy serious reform of Education and Health including Aged Care - where tens of billions new funding combined are necessary to make a serious difference. In response to the answering of those concerns Weatherill will probably then 'fall into line' on opposing the GST.