I sugggest you examine the MYEFO before commenting anymore.

If one accepts the absurd 1% of GDP rule then Rudd has plenty of money to play with.

Howard still has a few bill to spend as well.

How can they announce those sort of tax cuts when they have already promised 2 billion to heatlh, an open cheque to ed and sorts of other crap? They’re making the Liberals foray into spending look like a kids picnic.

I think they have problems.

Howard stupidly bought himself a hospital in Tassie for $40 mill and the other numbnut raises him $2 billion. It’s hysterical.

and encouraged over investment in housing, through the tax system

Well, except that Howard never touched those rules, and that actually he has discouraged negative gearing by lowering most people’s tax rates.

I think Labor could and should announce $50b in tax cuts, along the same staggered lines, but with an expensive EITC to make them even more progressive. Just model in a bit of higher growth stimulated by the extra cuts, another $10b recouped through improved integrity measures, we’d be there in a jiffy.

And I agree entirely with raising the GST to 12.5% and cutting all state taxes except perhaps stamp duty. Pretty efficient tax, stamp duty.

BBB

He’s squandered the prosperity coming from the mining boom, drastically underfunded higher education and public health, wasted billions on the Private Health Insurance Premium Rebates, failed to spend money on infrastructure at anything more than a fraction of what’s needed and encouraged over investment in housing, through the tax system, which in turn has led to the price of it becoming stratospheric for new home buyers. And the Liberal Party has the gall to claim its the better economic manager?

Since when does squandering today’s prosperity without any more than token concern for the future constitute good economic management?(BTW I’m looking forward to the new Labor Government investigating the scandalous investment practices behind the Liberals’ so-call “Future Fund”.)

There comes a time when the job of the electorate is to “Throw the rascals out”. The real time for the current mob (and the current NSW Labor Government) was at the last election. Unfortunately, the Opposition Leader in both cases was more intent on self destruction.

He’s squandered the prosperity coming from the mining boom, drastically underfunded higher education and public health, wasted billions on the Private Health Insurance Premium Rebates, failed to spend money on infrastructure at anything more than a fraction of what’s needed and encouraged over investment in housing, through the tax system, which in turn has led to the price of it becoming stratospheric for new home buyers. And the Liberal Party has the gall to claim its the better economic manager?

Since when does squandering today’s prosperity without any more than token concern for the future constitute good economic management?(BTW I’m looking forward to the new Labor Government investigating the scandalous investment practices behind the Liberal’s so-call “Future Fund”.)

There comes a time when the job of the electorate is to “Throw the rascals out”. The real time for the current mob (and the current NSW Labor Government) was at the last election. Unfortunately, the Opposition Leader in both cases was more intent on sef destruction.

BBB

BBB

This is possible, but IMO pretty unlikely. The clawback will reduce the incentive to move from part time work to full time work, but it leaves unaffected the payoff for moving from non-work to full time work, while the higher effective tax threshold increases the incentive to move from non-work to part time work. So the likely net effect is a few extra people moving from non-work to part time work and a few extra people moving from full time work to part time work. Thererore the total number of people wanting some form of work will increase slightly.

To confirm this you’d need to run it through a good behavioural model of people’s decision to work. Fortunately we have one – Melbourne Uni’s MITTS. Treasury uses MITTS so I presume they’ve already run the numbers through it – no doubt this is where Costello’s bit about “mums working part time” is coming from.

I’m guessing that’s just what his policy will announce, Patrick. It’s what I’d do if I was him, anyway.

The main practical difference in the Australian context between an EITC and the expanded Low Income Tax Offset that the govt favours is that retirees won’t get the EITC***. But since “self funded” (ie tax assisted) retirees are pretty well all rusted-on Howard backers (as they bloody well ought to be given how much workers’ money he has lavished on them), there’s little political penalty for Labor in this and it frees up funds to spend on a bigger EITC.

Rudd will be able to show a bigger amount than “$25 a week extra” for the average worker while spending the same $34B in total. And it nicely skirts the “me tooism” charge.

*** Note the phase in arrangement of the US EITC (ie with a negative tax rate segment) makes no sense in Oz without other changes to the welfare, family payment and income tax systems, but that’s a long story which he wouldn’t go into in an election campaign. That would come as a surprise – partly pleasant but mostly unpleasant – in Swan’s first budget.

$34B is too big a number. … It simply isnt that much for the majority.

er, whatever, then.

Thats $34 billion thats not going to hospitals / medicare ..etc

…

The theory is a little bit like the way torture works, etc

– wait, I’m confused, are we supposed to want to be tortured?

Rudd should introduce an negative income tax or earned income tax credit – even I would vote for him then!

The services argument is a good one but hard to run without being hit with the comeback – ‘what is wrong with giving people the choice about how to spend their own money?’ Very hard to deal with the complexity of funding for service delivery in that environment.