Your policy ideas for the next government?

With the next Australian election only a few weeks away, now is a good time to say which economic micro and macro policies you think a next government can/should implement.

Around and in between past elections I gave you my list of things to do and things not to do (see here and here). I will give you my updated list for this election but first want to hear what your suggestions are in the comment thread.

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18 Responses to Your policy ideas for the next government?

  1. Fyodor says:

    First link is bang-on: “This is somewhat embarassing, isn’t it?”

    Yes, quite. A bit less government doing would go down a treat after six years of the Dodgy Bros’ SNAFU.

  2. conrad says:

    As a quick one for universities, they could get rid of all the stupid research measurement schemes (ERA etc.) and simply keep the Discovery grants, since the latter is better at giving money to the individuals that deserve it than different schemes which measure research productivity and then give money to the same universities who tend to get the Discovery grants anyway (except via a VCs cut, which simply allows for more corruption and silly grandiose promote-me-to-my-next-uni ideas from them). They could also get rid of most of the monitoring bodies that simply create paper trails (including all where an external body does a better jobs).

  3. conrad says:

    Some more random suggestions are:
    (1) bring back the pension for single parents. Having kids in dire poverty simply gives you more long-term problems.
    (2) increase the dole. Making people go bankrupt also does no good for anyone in the long term.
    (3) Get rid of health insurance rebates. If you earn > 50K, you can pay the extra yourself.
    (4) Stop giving money to rich private schools (c.f., poor ones).
    (5) Add congestion charging in big cities (probably a State one)
    (6) Think about fast trains for short but populous corridoors (e.g., Sydney-Wollongong-Newcastle, Melbourne-Geelong-Ballarat).
    (7) Forget grandiose ideas about trains like Adelaide-Darwin, Melbourne-Sydney etc. until the useful ones are there
    (8) Stop wasting billions on refugee resettlements etc. . If you want be so nasty too them to keep them away, surely there are cheaper options
    (9) Reintroduce minimum TERs for universities. There’s no point in getting 18 year olds with TERs of 50 in the system (even forcing them to work a few years before coming if they have TERs of 50 would be okay). They just add pressure for bottom-feeding universities to lower standards even further.
    (10) Stop wasting money on the car industry. If you want to waste 500 million, there are better industries to do it on
    (11) Make personal housing part of the asset calculation for pensioners. If you have a million dollar house, I don’t see why the average tax-payer should be giving you public benefits when you can simply get a negative mortgage on your house.
    (12) Allow insurance companies to discriminate based on weight (we already do based on gender and smoking)

  4. Michael says:

    Get rid of all private health insurance subsidies. It doesn’t do any of the things it purports to do it’s basically a big scam and it’s incredibly wasteful. Ditto private schools. Add a pollution tax to petrol and diesel to claw back some of the externalities of vehicle transport. Add the GST to all food. Allow only minimum expenses on vehicles to be claimed as costs against earnings, if you want an expensive vanity company car you can pay the difference. Increase spending on primary and secondary school education.

  5. john r walker says:

    Make the study of history compulsory in secondary schools, ditto for the study of syntax/problem solving and ditto for cooking (and growing vegies).

    And ban the teaching of “cultural policy”, full stop.

  6. conrad says:

    Here’s a few more random ones:
    (1) Decriminalize drugs one by one based on their toxicity profiles
    (1.1) Keep a good record of this to see the effect it really has
    (2) Government to stop marrying people and only offer civil unions.
    (3) Most Australian animals should be legal as pets (most eat grass, are quiet, and don’t damage the environment when they escape).
    (4) Get rid of the AIS. Reinvest some of the money in community sports organisations that actually get people excersing, verus just watching tv.

  7. Anthony says:

    +1 for the decriminalisation of recreational drugs.

    1. Reduce income taxes by having land, payroll and consumption taxes. Taxes should be low, simple and broad. Result: More efficient tax system.

    2. Remove most current welfare payments (except for payments like carers and disability support). Let any permanent resident with a tax file number receive up to $500/week for six months, no questions asked. The welfare payments are registered as a HECS style debt that is paid back to the government through the PAYG system. Interest is charged daily at CPI + 1%. After six months, if recipients require more assistance they return to the current system.

    Results: 1. Less public servants to administer Centrelink payments.
    2. The unemployed and needy can easily acquire enough money to live rather than the current meagre Newstart Allowance.
    3. The Federal Government can provide more welfare at no net cost to itself.
    4. Reduces the misallocation of resources by not giving out unnecessary welfare. E.g. some recipients of baby bonus.

    Problem: $500/week may raise effective marginal tax rates for low skilled people trying to return to work? Though workers could obtain a wage and still receive the benefit.

    • conrad says:

      If you are only going to go to a HECS style system for 6 months, then you are really saying the most you will get back is about 26*500 = $12,500. If you are then going to have two different systems, then you need two different sets of forms, two different collections methods etc. . Given all the administrative charges and the fact many people wouldn’t ever pay it all back, it would be interesting to know how much you would actually be ahead with such a system. It would also be open to abuse near the end of people’s working lives, since if people hadn’t collected their $12500, they may as well.

      Also, the big and growing amounts are actually on pensions and helth, not unemployment. Figure 42 here might be handy.

  8. murph the surf. says:

    Consign the Nationals to the dunce’s corner – Australia needs a free trade agreement with China.
    It appears the Chinese want less hassle investing money here.Fair enough.

  9. crocodile says:

    Get rid of the 30% private health insurance rebate and the 50% childcare one too. They have only served to raise the price of these services. Usually by the amount of the subsidy.

    Downsize the federal government. Why do we have a federal health and education bureaucracy and state ones as well.

    Give me a tax cut but nobody else.

  10. Michael says:

    Interesting that no one has mentioned government spending on new infrastructure with the exception of fast trains. Deregulation and tax reform seems about the extent of it.

    Is this because we don’t need any infrastructure or government intervention? The private sector can’t make decisive economy wide interventions and is prone to rent-seeking as opposed to innovation whenever possible.

    We are still dealing with the aftermath of the GFC and has anything serious been proposed to tackle the vastly inefficient finance industry where super-profits are earned and has the capability to cause massive destabilisation to the world economy?

    The problem is the current generation of politicians and bureaucracy lacks the competence and the backbone to tackle anything serious. The stimulus spending on school halls will probably be this generations defining government achievement not because it is so great but because it will deliver tangible benefits to education and there is very little else of substance on the record as far as lasting infrastructure improvements.

    The lack of affordable housing is another one that surely should be on the table – is restricting negative gearing (a worthy policy that no one is proposing) the best that can be hoped for?

    • conrad says:

      I think one big problem is that most infrastructure is a State problem, not a Federal one, and so the infrastructure problem is really a problem in how they can get more money to the states. I doubt the rest of Australia wants to pay for an airport in Sydney because the governments there have been to woeful for the last 45 years to do it. And then the problem is whether you would really want to give more money to anyone in places like NSW or VIC who would have a hard time building a toilet block.

  11. murph the surf. says:

    re NSW : Ask the miscreants to pay!
    Is it beyond the law to remove ill-gotten gain from white collar crime?

    How effective is any level of government here guarding itself against corruption?
    More trade,definitely more challenges.

  12. Patrick says:

    I don’t really know, so I would take a very lazy approach.

    The analysis I have seen from PwC and the Grattan Institute (see figure 19) in whom I have some degree of confidence (disclaimer: I know some of the contributors personally and professionally) suggested that the greatest combination of cost/benefit projection and confidence in the proposed solutions lay in female and older workforce participation and tax mix reform.

    Also it is seems quite clear that workplace relations has swung far too far in the unions’ favour, it needs to be moved very sharply back towards the interests of the employed and unemployed (neither of whom are substantially represented by unions) as well their employers/potential employers.

    So I would do all of the above.

    Other than that deregulation, immigration, road congestion, transport infrastructure and schools appear the next best priorities. I’d start moving on those too but slightly less urgently.

    There are a lot of other good ideas here which I would take up too but again less energetically and urgently than the above, particularly:
    – Nick’s budget office;
    – decriminalisation of all drug use;
    – revamping the mining tax to fund Infrastructure Australia’s top ten priorities and considering external debt to make up the immediate shortfall;
    – establish a regulatory cartels branch of the ACCC with a statutory remit to identify statutorily-mandated cartels such as lawyers, doctors, pharmacists, unions and there must be dozens more, and recommend ways to minimise the rent-seeking.

  13. Steve X says:

    Simplify the tax system to get to the point where people on a salary get, say, $500 standard deduction and can avoid putting in a tax return at all as in the UK.

    Remove the ETS, bring in a $10/C02T tax and scrap all subsidies for wind and solar. Increase research dollar in low emission technology instead.

    More cake for everyone!

  14. Henry says:

    Sorry for commenting on a slightly old link.

    Immigration policy (not asylum seekers)

    1) deregulate the seasonal worker program to bare basics for employers, as well extend to other industries as horticulture doesn’t seem to be working well
    2) offer working holiday maker visas to a range of developing countries
    3) introduce a permanent pacific access quota for Australia akin to New Zealand
    4) abolish state migration plans and replace them with employer visas
    5) abolish regional concessions for all visas
    6) open up permanent migration options for low skilled New Zealand citizens who have been in Australia for extended periods of time
    7) introduce a specific internal company transfer visa for Australia
    8) produce an actual population policy or at least use IGR4 to have a discussion about how infrastructure, the environment and migration can co-exist over the long term.

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