Labor Undermining Labour?

I’m a Labor voter and I’ll do as I’ve always done at the upcoming election by voting Labor again. Nonetheless… I think there are at least three Labor Party policy pillars that made sense once upon a time but now need overhauling due to their turning counterproductive to labour. 

Education

Labor sticking to the same policies, only bigger…

The standard left-wing position is to get more students through high school and university to spread the prosperity of the professional class through the wider population. In the 70s, when the high school completion rate was between 30 and 40%, this made a lot of sense. 

Unfortunately, the right general policy goal transmogrified into abandoning technical schools, lowering standards at high schools and sending students to study increasingly watered-down and useless tertiary degrees. Somewhere along the line, the policy has ended up making people who do working-class jobs delay their entry into paying jobs and skill acquisition; people who derive benefit from tertiary studies do degrees that are less rigorous than otherwise; and people who don’t derive benefit from tertiary studies end up in the worst of both worlds. In short, these three groups are poorer, dumber or both!

This state of affairs is made worse by fields of study that are actively hostile to intellectual development and course credentialism or education inflation that turns on-the-job training into Master’s-degree cash cows for universities. Research in Lacanian gobbledygook or grievance studies generally and Master’s degrees in how to be a librarian should be discouraged rather than subsidised by governments handing over blank cheques to universities.

Sadly, education is the policy area that Labor is least likely to change course on. The university sector is its client and an increasingly bloodthirsty monster. Some major changes in how general society views tertiary education would be required for Labor to ever contemplate cutting the conveyor belt directing students to universities and the ever-growing need for credentials. There’s also a very good case for encouraging some kids to drop out of high school early and get to working and apprenticeships earlier. 

Another potential reform option, of politicians actively choosing which courses do or do not get funding… no, that’s crazy — best that be left in the hands of unelected university bureaucrats and tenured academic staff with purer motives.

Income Taxes

There’s a whole infrastructure behind income taxes. On a technical level, it’s easy to increase incomes taxes at the upper end and think you’re progressive job is done. And that might have been true when income taxes were first introduced in 1915…

In 1915, there was comparatively little capital in Australia, no great accumulations of wealth over generations and plenty of cheap land. Taxing high incomes was in effect taxing wealth. But that’s all different now.

We should be aiming for our society to be more dynamic, with people’s net worth rising and falling. People shouldn’t be able to just sit on their wealth and working people starting from nothing shouldn’t be hampered from accumulating wealth. There needs to be a balance.

In contrast with 1915, simply taxing higher incomes increasingly serves to hamper the accumulation of wealth by people starting off with nothing, or less than nothing after obtaining an increasingly useless university degree. A 35% marginal tax rate to a 65-year-old sitting in their paid-off house is peanuts compared to a 25-year-old up-and-comer paying off their HECS debt and contributing 10% to super. 

Nevertheless, the default Labor position is to maintain those higher income tax rates, maybe increase them at the top end, and continue to tax labour at a higher rate than capital. More imagination is needed, much like when Labor first introduced a capital gains tax in 1985. And now, with the much better state resources and technology at our disposal, more can be done.

Here are a few suggestions to shift the overall tax take away from a simple annual cut of income:

  • Tax refunds are made over multiple years. So if your income is highly variable from year to year, as it often is for parents and those creating businesses, you get a refund based on taxes paid in previous years
  • Tax incomes earned from work and one’s own business at a lower rate than income earned from capital
  • Significantly drop the tax rates on the first x amount of income across a lifetime
  • Drop the 50% capital-gains tax offset and index to inflation like in the good old days
  • Introduce a Tobin tax
  • Apply Georgist land taxes on wealth held in property
  • Increase consumption taxes, reduce income taxes, including negative tax rates on the lower end — in essence, money for nothing to offset the increased taxes on consumption
  • Rather than a flat rate, increase consumption taxes on luxuries or unproductive or unhealthy goods (in other words, expand the scope of sin taxes)
  • Introduce direct wealth taxes for total assets valued above a certain threshold
  • Introduce an inheritance tax
  • Get rid of payroll taxes

Dual-Income Families and Cheaper Outsourced Childcare

We’re in some senses a freer nation than we once were. There is more choice available and the entrenched status of women in the workforce has been a wonderful policy success that the Labor party in particular can be proud of.

The labour movement also takes great justifiable pride in its successful fight for a 40-hour working week and unleashing much more leisure for family-friendly fun times. So why is the Labor Party aiming to double a family’s workload with an 80-hour working week? While I don’t think the aim should be to discourage dual-income families and outsourced childcare, I don’t think we are taking the complete cost of encouraging them into consideration. 

Kids are increasingly obese and socially anxious, adults are increasingly lonely or stressed and parents are overprotecting their children. Could much of that be resolved with one parent at home cooking home-made meals from the day’s grocery shopping, tending to extended family and friendships throughout the community and keeping an eye on neighbourhood streets and backyards to make sure the kids are alright?

We have used our increasing wealth as a society to make things worse for anyone with a young family. A couple on an average wage with a couple of kids these days is much less likely to be owning a home and feeling secure despite both parents working jobs that require tertiary-level degrees when compared to a single-income family from the 1950s. Granted, the availability of goods, services and conveniences these days has skyrocketed, but what’s the point of a larger, more functional kitchen in a home you don’t own when no one has the time to cook?

One potential way to balance the situation is to take the money that would otherwise be paid to subsidise childcare and pay it to all parents directly to do with what they wish. That way, there’s more real choice in the matter. Alternatively or additionally, households with children could be able to income split. Regardless, the default Labor position of encouraging families to work in excess of 40 hours a week should be downgraded and a policy of making life easier for families who only work 40 hours a week should take its place.

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Conrad
Conrad
9 days ago

“Unfortunately, the right general policy goal transmogrified into abandoning technical schools”
The obvious reason for this was because many were teaching even less than the other public schools and even tradies need basic literacy and numeracy. They were basically awful and not teaching kids anything. People seem to have this fantasy that these kids ended up only slightly less literature and numerate than kids from better schools, but somehow got a whole lot of other skills to compensate. They didn’t. Look at where job growth went, and look who got all of those jobs. In Victoria, that was one of the things Kennett got right.
“This state of affairs is made worse by fields of study… Research in Lacanian gobbledygook or grievance studies generally and Master’s degrees in how to be a librarian should be discouraged rather than subsidised by governments handing over blank cheques to universities.”
People complain about this but it’s basically crap. It’s a small percentage of what universities do but massively over blown due to politicians being able to get political mileage out of it. Most faculties are not Arts faculities, and this sort of stuff only represents a small proportion of what Arts faculties do.
“There’s also a very good case for encouraging some kids to drop out of high school early and get to working and apprenticeships earlier. ”
That may have been true once upon a time, but now as you note, things have been dumbed down a lot (especially in maths). What trades need less than business maths? Furthermore, if you consider a lot of tradies are running small businesses, and government processes are more complicated these days, all you are doing is cursing those that will never have the skills to do this — Let alone trades which are complicated enough to need year 12 skills (which I suspect is the majority).
“One potential way to balance the situation is to take the money that would otherwise be paid to subsidise childcare and pay it to all parents directly to do with what they wish. ”
A large reason people have to work endlessly in Australia is because the big cities have very expensive housing. Places like Sydney and Melbourne have almost no cheap housing. Giving people more money or moving it around in small circles won’t solve that problem. It will often just make real-estate agents richer. Allowing freer development, getting rid of negative gearing for housing etc. would probably help a lot more.

John r walker
John r walker
9 days ago
Reply to  Conrad

“It’s a small percentage of what universities do but massively over blown due to politicians being able to get political mileage out of it. Most faculties are not Arts faculities, and this sort of stuff only represents a small proportion of what Arts faculties do.”
Data ? Subjectively I’d disagree but stand to be corrected

Conrad
Conrad
9 days ago
Reply to  John r walker

https://www.universitiesaustralia.edu.au/wp-content/uploads/2020/11/200917-HE-Facts-and-Figures-2020.pdf
Figure 16 has degree type. The main place you will find that sort of stuff is in Education and “Society and Culture”, where it would only a be part. These two add up to 28% of enrollments. If this sort of stuff is 10% of these courses, it is 2.8% of stuff.

Conrad
Conrad
8 days ago

Apart from the German system splitting up schools as they do, their education system is not as good as you might imagine — and that comes from a country with a great history of engineering and science. I think comparing it to Australia is not great either, as the TAFE system here basically became a disaster in the last decade or so in some states. To me trying to fix the TAFE system up would be vastly easier than trying to bring back technical schools. So you are comparing something that seems to work well enough (Germany) with a disaster. In addition, even in the article you link they note:
“While university graduates in Germany also earn much higher salaries than workers who have attained less education, vocational education and training (VET) in Germany is a very common pathway to gain skills and embark on successful career”
Given this I am surprised the Germans are happy with it, because what you are saying to a 13 year is old that if they go to one of these schools then they are going to enjoy a life of mediocrity (or at they should be happy being average).
Even if you could split the schools and create half-decent technical schools, what happens to those kids that don’t end up as tradies? As I noted, job growth for tradies have been pretty flat for a long time, unlike other types (the abs has the figures for this). High school dropouts also have pretty poor outcomes in general (some of this is obviously to with characteristics of the kids who drop out and not the schools), so this is another reason to get kids to stay to year 12 (basically, it keeps their options open).
“On the quack courses, I think you’re underestimating their impact. Even the more established humanities fields, like Anthropology, English and History, have been transmogrified by some kooky ideas.”
I don’t. At most places, these are relatively courses with small enrollments, so to some extent, who cares (indeed your initial examples are masters and graduate courses, which tend to have tiny enrollments). They are probably also being taught well at most places too (I’m currently working at Adelaide where the English department has John Coetzee is, so I’ll assume English is going fine here!).
I’m not disputing there are such crappy courses (often living in Education departments and poorer sociology departments). But if you want to let universities do more or less do what they want (and I don’t see any other great option), then there will always some dross. But nothing is perfect and that doesn’t mean most of what is done is a waste of time. The solution is to provide good information for students, in which case hopefully it allows these sorts of things to self-correct as student do these courses less and less (and then universities close them down).

R. N. England
R. N. England
5 days ago

Universities promote expertise. Allowing non-experts to decide what is taught undermines their raison d’être.
Their present desperate situation now is due to the economic model that universities are sellers, and students and taxpayers are buyers.
Universities are foci of our enormously complex culture, with the burden of seeing that it survives and thrives. Economics is part of that culture, not the other way round. Universities are victims of that category mistake.

R. N. England
R. N. England
3 days ago

Putting it another way:-
The most cultured people are the ones that should be making the decisions that will allow our culture to survive and flourish. Part of being cultured is understanding science, especially the science of human behaviour. Putting decisions into the hands of people who have a less adequate knowledge of what’s going on allows the funds of tax-payers and health insurance contributors to fall into the hands of naturopaths, homeopaths and other crack-pots. Electoral democracy, the health payments system, and education system have the same problem. They currently put decisions into the hands of people who are too easily defrauded.

Conrad
Conrad
2 days ago

Antonio — Australia already has endless bureaucratic rules universities comply given to them by non-experts that are essentially pointless (see https://en.wikipedia.org/wiki/Tertiary_Education_Quality_and_Standards_Agency). Most academic will have had waste their time ticking boxes to comply with them.
In addition, many subjects, probably covering the majority of students (i.e., most subjects with professional bodies) are governed somewhat more sensibly by independent expert panels. That would include Engineering (and hence maths), Psychology, Medicine, most health sciences, etc. .
So the problem is not lack of government, it’s endless amounts of it which is a huge opportunity costs and stifles innovation.
Also, comparing humanities faculties in the US to Aus universities as a whole is like comparing toast with roof tiles. In Victoria, the place with historically the most stuff of the kind you are talking of is La Trobe (https://www.latrobe.edu.au/humanities). If that’s the worst it can get, it isn’t too bad.
So in Australia, you are really just talking about a political beat-up. The worst most students (and academics) will have to put up with is a workshop on cultural understanding and gender equity, which are generally run to indemnify the university against outrageous behavior from a small minority of staff. It is also done because some students really need it — one problem universities have is outright racist, ageist, and sexist comments on teaching surveys. That is, the type of comment you would get fired for/seriously disciplined for in any workplace (even just just for legal reasons).