Monday, August 29, 2016

The taxed vs the "taxed nots"

The New Start Party looked with disgust at ScoMo and his "taxed" vs "taxed nots" dichotomy.

ScoMo is clearly very worried about too many "taxed nots".  But he does nothing about it.  What causes people to pay no tax?  Let me enlighten you ScoMo, it is a lack of income.  These people do not enjoy their lack of income.  They don't aim to have low incomes.  If they do have low incomes, its because they lack opportunity, and because people are being screwed by big businesses.  ScoMo, I don't see you trying to fix this.

Actually, lets make it clear what ScoMo is prepared to do.  He's prepared to give money to the "taxed nots" provided he can do it without collecting a dollar in tax from the rich.  Never mind that the rich in Australia are very well off indeed.  Never mind that the poor get a pretty poor deal.  ScoMo and his mates want to sell off all government assetts and cut the services the government provides to the bone.  God only created poverty to punish bad people.  ScoMo and his God botherers have no business interfering in the natural order of things.  The only reason they want to give to the poor at all is because otherwise they will be a nuisance and turn to begging and crime.  And that they do grudgingly.

The New Start party will look at the level of inequality in Australia, and if it is too big, we will hang our heads in shame.  We will tax the rich and give to the poor.  The poor will not be poor.  And the rich, they will feel good because they will know that they are helping make a great society.

And we will never ever have work for the dole schemes.  How can we, when the "dole" is paid to all without any strings attached?  What we will do is to provide work experience for anyone who wants it.

There is this quaint idea that everyone can have a job.  How can this be when we put enormous effort into automating processes so that we don't have to pay to employ people?  Sure people move into new areas.  Look back 40 years and hardly anyone was employed making long macchiatos and chai lattes.  Look back 40 years and there was no such thing as a personal trainer.  But its not enough.  The creation of new occupations is not keeping up.  And one great way to expand these type of jobs is to give more money to the low end of the spectrum.  They'll enjoy the coffee and get fit, keeping lots of people working.

But no, ScoMo doesn't want that.  He's perfectly happy for there to be downward pressure on the wages of low income earners, and reduced welfare payments.  He's perfectly happy to remove upward pressure on wages by allowing temporary workers to come here from overseas.  He's perfectly happy for the CEO of the Commonwealth Bank to get over $10 million last year.

And just now Tony Jones defends the current wage inequality by pretty well saying that its a tide that you can't swim against.  Fuck me.  The defeatist face of the fucking neoliberal agenda.

Wednesday, August 24, 2016

The New Start Party

So with the rise of Trump, Sanders, Brexit, and in Australia our own resident loonies and progressives, its time for a new political party.  The New Start Party.  Its a pun on the Australian unemployment benefit which is called Newstart.  And the desire to make a new start.

Anyway, a party needs policies.  It also needs members, but we'll leave that for later.

There are a few basic underpinnings of the philosophy of our government.  Perhaps the most fundamental is to focus our efforts on helping the disadvantaged and the powerless.  The much discredited "trickle down" economics will be replace by one that recognises that the best way to help everyone is to help those at the very bottom of the pile.

Inequality.  That is a big one.  Now most inequality is because some people have managed to screw up free markets somehow.  Its going to take some time to unravel all of the market distortions.  So in the meantime, the way you reduce inequality is to increase the income of the poor, and decrease the income of the rich.

Increasing the income of the poor is easy.  You just pay everyone $20,000 per year (or some suitable rate), no strings attached.  Gina Rhinehart included.  So Newstart allowance goes.  No more jumping through fucking hoops to survive.  No more pretending to look for work.  I mean, you can look for work - nothing stopping you, but you'll only do it if you actually want to.  I had a terrible experience when on the dole in 1985.  I was temporarily living in Sydney, and the local Commonwealth Employment Service actually tried to find me work.  I was on holiday!  What were they thinking?  For 25 or more years now I haven't been on the dole.  But I'm getting old now.  If I lose my current job chances are I'll be back on the dole, going through a fucking meaningless charade to survive.  No one should have to put up with that shit.

Decreasing the income of the rich is also easy.  You just have a strongly progressive tax rate.  The first $50,000 are taxed at 30 cents in the dollar (no tax free threshold).  The next $50,000 at 40 cents.  The next at 50 cents, then 60, 70, 80 and 90.  So the 90 cents rate kicks in when you earn over $300,000.  I use "earn" advisedly there.  I know some very talented, hard working people, and they don't get paid $300,000.  I also know that the boss of the Commonwealth Bank made some $10 million last year.  And if he's got anything to do with the abominable behaviour of the Commonwealth Bank, then he deserves nothing.

Actually, its not quite as simple as I made out.  That amount of money that everyone gets, and the amount you earn when the top tax rate kick in are linked.  So if the guaranteed income is $20,000, then the top tax rate kicks in at 15 times that, or $300,000.  If you want the top tax rate to only kick in at $600,000, then the guaranteed income would have to go up to $40,000.

You may think that these high marginal tax rates will discourage workers, and will lead to high income earners leaving Australia.  Well, on the discouragement front, I call bullshit.  People work hard for many reasons, and money is not the most important.  People work just because they like to.  They do a good job because it makes them feel good.  They enjoy the status of being a doctor just as much as they enjoy the money.  I am not a hard worker.  It just isn't in my nature.  But it is in the nature of some of my friends.  And you could pay them a lot less, and they'd still work hard.  But there are people who work just for the money, and who might leave Australia if they are taxed too much.  And you'd have to say that is one of the best bits of policy ever - a policy that makes money hungry dickheads want to live somewhere else - fantastic.

There is another side benefit to this policy - tax receipts will be up.  So my government will have money to spend on hospitals, education, and all that stuff that most governments are realising they can't afford.  We'll afford it.  Yes, we will be a big taxing, big spending nation.  Because the alternative doesn't fucking work.  The alternative is an experiment that has been running for 30 years now, and in case you hadn't noticed, its making people vote for Trump, Brexit, and left and right wing crazies everywhere.  It ain't working.

Anyway, that is the first policy in a nutshell.  All just basic common sense really.  Nothing that any sane person could object to.

The second policy is a bit more contentious.  We in Australia keep our economy chugging along through immigration.  And a good thing it is too.  The new arrivals invigorate our culture.  But, what is the best level of immigration?  Rich people run businesses, and businesses want new customers so that they can expand.  But new migrants put pressure on housing, roads, schools, hospitals etc.  So the understandable greed of the business owners needs to be offset by a realistic rate at which new infrastructure can be built.

But there is another sort of migration - the importing of workers - supposedly to do jobs that Australians won't/can't do.  Again, this is bullshit.  When the Commonwealth Bank wanted a CEO, did they decide that a salary of $200,000 would do?  No, of course not, they realised that to get the sort of weapons-grade arsehole they needed, they would have to pay considerably more.  Could it be that exactly the same principle could be applied to getting good fruit pickers?  Might it be that kitchen hands would actually be in plentiful supply in Australia if they were paid more?  Would people with a passable command of English be driving taxis if the rate of pay was good?

A common argument for these imported, temporary workers is that they are paid the same as local workers, so what is the harm?  Well, the benefit to the employer of a foreign worker on a temporary visa is that they are powerless.  Sack them and no family or union will fight for them.  They know full well that if they annoy you, you stop employing them, and its back to the Philippines for them.   And guess what, if they get sick, yes, that is annoying.  Nothing business likes more than a powerless, compliant workforce.

But what if you really need their skills?  Good, allow them to migrate here permanently.  No more second class non-citizens living here.  Its un-Australian.  Our government would immediately abolish all temporary work visas.  But everyone in Australia on on of these visas would be invited to apply for citizenship.

Realistically, there are industries that won't work in Australia.  Our labour costs are too high.  We already know that we can't support an unsubsidised car industry.  No doubt there are other industries that won't survive under our Government.  Its not ideal, but the alternative is to put our resources into areas where they won't be used effectively - like the car industry.  But as a high taxing, high spending government, we would be able to make decisions to support industries that might not survive on their own.  We would do this when the benefits of doing so outweigh the costs.  Such decisions would be strategic, not driven by whim or base political opportunism.

Tuesday, August 16, 2016

Earliest hayfever?

Sunday, August 14th at the footy (Freo got thrashed by Adelaide), and I've got itchy eyes and a stuffed up nose.  Its about a week earlier than my normal earliest signs of hayfever.

Bloody global warming.

Sunday, July 24, 2016

House prices

Just imagine for a second that it was known that house prices would not increase for 10 years.  In Australia, that is almost unthinkable.

Now a lot of houses in Oz are bought as "investment properties".  They are rented out, and at some stage in the future they are sold, usually for a healthy profit.  Typically the rental income is small.  That is, if the investor borrowed the money to buy the house, then the rental income would be less than the interest payments on the loan.  Or, conversely, if the investor had the money to buy the house, but instead invested it in a term deposit, they'd make more money from the term deposit than the rent they would from renting the house.

No, the actual money is made when you sell the house for a lot more than what you bought it for.  But what if that capital gain vanished?

With no expected capital gain, you'd actually want to make money on the rent.  But then you'd need to charge around 50% higher rent.  But then people wouldn't rent your property.  So your investment doesn't make sense.  For it to have made sense, you'd need to have bought it for two thirds the price you paid.  And the same goes for all the other investors.  They are all sitting there, thinking that they need to sell because they are losing money.  So rents will fall, and investors will stop buying houses.  And that should make house prices fall.

And at this point, some renters should start to buy.  Because they were close to buying before, and with the fall in house prices, they can now afford to buy.  So investors are replaced by owner occupiers.

Anyway, this won't happen.  Australia takes a lot of migrants every year.  A lot.  And they all need houses.  And that means that any fall in prices is purely short term.  In the long term, house prices will keep rising, and investors will keep the prices higher than they really should be.

Friday, May 27, 2016

Carbon fibre furniture

We love our carbon fibre bikes - so light, yet so strong.  As someone who thinks that moving house once is one time too many, and that carrying heavy furniture is a right pain, I'm thinking that we need carbon fibre furniture.

A carbon fibre sofa where all the weight is in the cushions.  It might even need hooks onto which you attach weights to give it some gravitas.  A carbon fibre dining table that you can carry around on your shoulder.  Ditto for your carbon fibre desk and your carbon fibre cupboards (except that all wardrobes are built in these days).

Sunday, May 8, 2016

What should Labor do?

Australia votes for a new government in a few weeks.  The election has been called, and campaigning has started.  I'm a supporter of the Australian Labor Party (ALP).  So what should the ALP do?

In my mind it is quite simple.  When you look at the recent past and the probable future, there is a consistent theme of change:

  1. Big business and rich individuals refuse to pay tax.
  2. Continual technological improvements reduce the number of jobs available.
  3. Increasingly Australian workers are competing directly with overseas workers.  And this is driving down wages.

The Liberal Party (Australia's conservative party) responds to these changes as follows.  They recognise that their tax income is falling, and therefore reduce their expenditure.  They recognise that there aren't the jobs needed, so the penalise the unemployed, and invent fictitious paths to employment.  They actively support the use of overseas labour.

The Libs also pander to the fears that Australians have about the future by encouraging them to "get ahead".  Its a fear thing.  The perception is that in the future if you retire without enough money, you will suffer very real hardship, because the government can't collect the taxes needed to give you a decent retirement.  So the Libs will be generous in helping you avoid that fate - through tax tricks like negative gearing, and (until they fixed it a week ago) through incredibly generous superannuation for the well off.  Basically, its the Titanic.  Everyone is scrambling for lifeboats, of which there are too few (lack of taxes...).  There is some effort involved in climbing up to get on a lifeboat, and the Libs model is that some people should kneel down and form steps to help others get on board.

So my suggestion for the ALP.  Firstly paint the Libs model in all its defeatist and elitist glory.  And then, speak directly to those people who fear missing out on a lifeboat.  Tell them that you will tax the rich and the corporations, and that there will be lifeboats for all.  Tell them that they won't be used as stepping stones to help others clamber on to lifeboats.  Tell them that since we live in an ever more productive society, then need never fear being "left behind", and that  we live in a time of plenty, not scarcity.

Sunday, April 10, 2016

UWA restructure

So right now the University of Western Australia is undergoing a restructure.  We are going to lose around 200 "professional" staff.  "Professional" means you aren't an academic - you are an administrator or you do accounts, or you are a PA to an important person, or a lawyer, or you work in HR, or like me you are a unit coordinator, etc etc.  This is about 10% of the total.

The new model for the university is that there will be 4 faculties and a central admin.  Each of these will have a "service delivery centre" (SDC) which will house most of the admin functions.  This is a considerable reduction in the number of faculties, and this new model is supposed to allow the 10% cut in staff.

The current phase of the restructure involves deciding which professional positions are to be based in the SDCs, and which will be based in the individual schools that make up the university.

And I'm wondering about the restructure.  I'm wondering exactly what values will be driving this process.  What is in the hearts of the people driving the process?  Obviously everyone working at the university will have different priorities.  What do I value?

We teach students.  I love the students.  They are great young people at a very difficult time of their lives.  They've done well at school, but now they are making their own way, in an environment where they may not do well.  They are starting to chart their own path in the world.  They may not be able to achieve what they set out to do.  Dreams may be shattered.  I reckon we owe them something.

We have to offer them a good degree.  High quality, with high standards.  A degree that has some status in the world.

We should not enrol students who have no chance of success.  Universities have plenty of data on high school and degree performance.  The very least they should do is give students an idea of their chances of success in their proposed course(s) of study.  Its not impossible for a student with a weak background to succeed, but at least we should tell them up front that they have a long hard road ahead of them.

We have to fail students who don't master the material.  We do no favours to first years if we let them progress to second year despite a failure to master the first year material.  "Failure" is not really failure, it is just a sign that your efforts are best taken in a different direction.  By not giving that signal early, we are delaying the inevitable and wasting the students time.

Clearly the university makes money from students.  So the university has a motivation to pass students who should fail.  But ultimately the professional pride in each of the schools at the university will stop them handing out degrees to undeserving students.  It really is best if students stop wasting their time as soon as possible.

A very important part of failing students who haven't mastered the material is not allowing cheating.  There is currently a push towards online testing.  Why?  Because it is cheaper to do testing online, but I have yet to hear of a method of having online assessment for 1000 students that isn't susceptible to cheating.  I look after a unit where there is an online assessment component.  Its worth 10%.  If it wasn't worth marks, the students wouldn't do it.  That is why its worth marks.  The reason its only worth 10% is because you can cheat at it.  So you can't pass the unit just by cheating on this component.

In some situations markers are paid casual rates, but are told that a certain number of essays are expected to be marked per hour.  So if we give you 40 essays, we will pay you for 2 hours.  If such a marker detects cheating, they will be required to do extra work, work that may not result in extra pay.  Such markers will, suprise, suprise, detect very little cheating.  Whatever structure UWA decides on, they do need to make sure that perverse incentives to tolerate cheating are not part of the system.

We have to be organised and efficient.  Its one thing to have students failing because they aren't good enough, but quite another for it to happen because their course of study is disorganised and haphazard.  Every unit should have a clear structure spelt out at the start of semester so that students know what is expected of them.   The students fill in a "SURF" survey on each unit, and generally the scores are good.  Where they aren't, the university tries pretty hard to fix it.  This will be a key part of the restructure.  If SURF scores fall, the university needs to see if any of that has been caused by the restructure, and fix it immediately.

Lastly, all the core units that make up the backbone of a degree should form a cohesive structure.

So mainly I care that we do the right thing by our students.  And I hope that the students are uppermost in the minds of the people doing the restructure.  And not just because of the dollars attached to them.