Tuesday, 28 July 2015

ETS V GST

I wrote not long ago about how a scare campaign on the ETS would not have the same effect this time round.
The public have experienced one and found it a big yawn. contrary to what a lot of very serious people believe it was not a major issue in the last election.

Moreover if it is linked to the ETS in Europe it is going to start at a low level so the initial price could well be less than half the $27 it was when a fixed price.

Now Tony Abbott could well be going to the next election promising to double increase the GST by 50% with the extra money going to the States for Health.

Here is the rub. Which measure will raise electricity prices more?  Yes you guessed it in a highly ironically move Tony Abbott would do more to cut emissions by raising electricity prices however you lose a lot of the benefits of what the ETS would do.

Monday, 27 July 2015

Adam Goodes

Apparently a lot of politically correct people do not like spectators booing Adam Goodes at Aussie Rules games. Indeed they claim it is racist.

Racist ah.

The Swans have other aboriginals playing in the team. Do they get booed?   NO!
Other Aussie rules teams have aboriginals in their teams. Do they get booed? No

It is only Adam Goodes.

It could well be they boo him simply because he is a tosser. It has been so ever since people have have going to sporting games.

It is pertinent to say here this only started when he deliberately made provocative gestures to part of a crowd. The only reason he wasn't fined , like any other sportsman, was because he was allegedly displaying his heritage.

Postscript
I should have added previously a person who pays their money at the turnstiles is entitled to cheer or boo as much as they wish.

Thursday, 23 July 2015

Around the Traps 24/7/15

It is time for Around the Traps again.
Hopefully I will update on the weekend sometime.  Greece still topical and tamino is on fire in climate


Aussie,Aussie,Aussie,Oy,Oy,Oy
Northern America
Europe
Asia
Wonk
General
Climate
Andrew Gelman ( Mainly stats)
Genial Dave Giles ( Econometrics)
  • nuttin as yet. Not happy Dave
  • Marc Bellamare on outliers Thanks Mark
Dianne Coyle ( quirky + Book Reviews)
Vox wonk

Wednesday, 22 July 2015

Glenn Stevens casts doubt on trend growth

Glenn Stevens who is the Governor of the Reserve Bank of Australia made a speech yesterday.

In it he talked about whether the trend rate of growth has declined lately. It may have declined for the 3.25% most people (and the budget assumed) thought.

This does have implications for fiscal policy. It does mean that when the economy gets back to its trend level the budget will not gain the revenue you would normally expect and thus the budget would not automatically balance..

This means there must be either cuts to expenditure and/or a rise in taxes to enable the budget to balance ONCE the economy is back at trend growth.

To do that now when the economy is weak is to repeat the mistake Wayne Swan did when he cut 0.7 percentage points from GDP. Easily the most austere budget since budget figures were collected.

Thus any Government ( or Opposition needs both a short-term fiscal policy together with a medium term policy.
In the immediate term we need to get back to trend growth. In the  medium term we need fiscal consolidation.

Tuesday, 21 July 2015

What did the price on Carbon do in Australia

Hugh Saddler examines putting a price on carbon affected carbon emissions in Australia.
He finds that emissions fell when we had a price on carbon and started to rise when the price was removed.
 Who'd thunked it!
What is particularly interesting is the different reactions between the wholesale and retail markets.
What should not be forgotten is the rise in prices to pay for a gold paved poles and wires.

Very interesting article.

Monday, 20 July 2015

Changing taxes

Perhaps the silliest argument about whether to increase the GST is that it is a regressive tax. Does this mean you only increase or have progressive taxes?  The best indirect tax is a GST. A country must have an indirect tax. Overall the GST should be broadened with compensation for low income earners or those on welfare.

It isn't whether an individual tax is progressive or regressive but whether the TAX SYSTEM is progressive.

I doubt many people would argue the more money you make the more taxes you should pay. As it is overall the Australian taxation is progressive however equity is only one concept you take into account. Efficiency is another one.
The Henry taxation review was pretty good and one only need adopt most of its reconsiderations.

In essence you get rid of most state taxes and have broad based taxes in their stead.

Go do it!

The Ashes Second Test

Wow, The second test was a mirror image of the first test except Australia were far more dominant.

The Australian batsmen were rarely troubled and easily scored runs. The bowlers were disciplined and swung the ball better than their pommy counterparts. They also got more out of this dead pitch.
They fielded well.After winning the toss Clarke captained well. The two changes worked quite well.

The Poms were awful. Lords was a dead batting pitch yet they managed only 103 in the second innings. They need an attacking partner for Cook opening, A first drop with a decent technique and a replacement for Bell. Pieterson is the obvious replacement for Bell. Bairstow for Ballance.
Against the Windies, The Kiwis and now us the poms are usually 4-3- or 40 or 50. given this has occurred too often something must be done.
Only Broad was impressive bowling. Anderson had the worst test I have ever seen him play.
I doubt if the bowlers will bowl as badly again.

I think we are favourites to win the Ashes however Anderson can still win a test on his day. if he bowls badly the Poms are shot ducks.

We shall see