Wayne Swan's 2009 Budget

[Jumpin' Jimmy]

Sure, it would be great, but it will never happen, so not particularly relevant

It's relevant but not politically expedient

 

[TheBloods]

It's relevant but not politically expedient

Legislation against smoking is hardly relevant for a budget.

 

[Jumpin' Jimmy]

A rather stupid and ill-thought comment. Even if you are a Labor 'supporter' (BTW I hate using the word 'supporter' in politics... their not football teams FFS).

The alco-pops tax is a pure tax grab disguised by the Labor party as a health initiative. Reports have shown it hasn't had the impact on youth binge-drinking. Reports also show older women drink more then the alco-pops targetted 18-24 yo bracket. Reports have suggested youth are simply switching alcohol products and mixing their own drinks resulting in an increase in drinking issues.

MT proposed increase to cigarette tax applies to all brands across the board. MT has straight away described it as a revenue raising tax initiative with the benefit of decreasing pressure on the health system... unlike the alco-pops which was branded by the Labor party as a "Health Initiative" and denied reports it was a tax grab.

CHALK vs CHEESE

If it makes you feel better.... both sides are guilty of blatant hypocrisy on these issues. Taxing smokers has always been a pure tax grab, as was the alcopops tax attempt. Anyway how can you differentiate on brands of cigarettes..... "Marlboro Man" Malcolm, John "Winston", "Winfield" Wayne or "Camel" Kev?

For the record:
- I definitely think Labor are pushing for an early election before next year's budget. Get in for another term before they really cause some pain to the Australian public.
- I think Liberal will run with MT at the next election. He wont win but I think he will definitely expose Rudd/Swan's poor management flaws leading into it.
- Once the dust has settled after the election Liberal will make Costello their leader to lead them to the following election

Still keepin' the dream alive!

 

[Jumpin' Jimmy]

Legislation against smoking is hardly relevant for a budget

Banning it or taxing it to death..... we're still talking Politics

 

[TheBloods]

Banning it or taxing it to death..... we're still talking Politics

Is this meant to be a serious comment...?!?

 

[Jumpin' Jimmy]

Is this meant to be a serious comment...?!?

Lighten up a bit!

 

[TheBloods]

Lighten up a bit!

Lightening up and don't tend to go together!

 

[Jumpin' Jimmy]

Lightening up and don't tend to go together!

Politics and does though!

 

[TheBloods]

Touche!

 

[nut]

Rubbish - it uses the oil income (and high taxes) to support its current level of spending. It's just that the oil income is so high that there is a surplus. There is no evidence to suggest that they have high incomes because they run a surplus and invest in a sovereign wealth fund.
So now you're comparing a tiny country with a tiny population with a huge country and larger population. Govt income in Norway is ~$100Kpc while Australia's is ~$20Kpc.

Let's add some more analysis. Norway's GDP per capita is US$53K. Australia's is US$36K.
Oil and mining and similar finite natural resources contribute about 30% to Norway's GDP and about 10% to Australia's. Let's adjust out the impact of those, but we'll be generous and only reduce by a 10% difference instead of more. So to make it easy we'll reduce Norway's GDP 10%.
Then adjust for average tax rates in each country - for Australia it is ~28% and for Norway it is ~37%.
Then adjust for the international cost of living, where the index of Norway to Australia is 1.58.

After all that the equivalent adjust GDP per capita for Norway is $19K and for Australia is $26K.
So it's not clear that the people in Norway are better off because of the Government's economic policies.

On top of that the Norwegian Govt has a debt/GDP ratio of about 50%, whereas Australia's is under 20%.
In addition, the Norwegian Govt surplus hasn't helped them so much as their GDP is forecast to fall by 1.7% in 2009, more than Australia's.

So what are all the other examples you have?

Ummm.. Future Fund... What are all these infrastructure schemes that would have saved us now?

You still have not addressed the issue of why govts should run surpluses. Why does it work better for a govt to tax highly and invest the proceeds in bonds and equities?

This article gives you the answer to why you should run a surplus and have a sovereign wealth policy... Or do you want the baby boomers to spend every last cent??

http://www.nytimes.com/2009/05/14/business/global/14frugal.html?_r=1

OSLO — When capitalism seemed on the verge of collapse last fall, Kristin Halvorsen, Norway’s Socialist finance minister and a longtime free market skeptic, did more than crow.





As investors the world over sold in a panic, she bucked the tide, authorizing Norway’s $300 billion sovereign wealth fund to ramp up its stock buying program by $60 billion — or about 23 percent of Norway ’s economic output.

“The timing was not that bad,” Ms. Halvorsen said, smiling with satisfaction over the broad worldwide market rally that began in early March.

The global financial crisis has brought low the economies of just about every country on earth. But not Norway.

With a quirky contrariness as deeply etched in the national character as the fjords carved into its rugged landscape, Norway has thrived by going its own way. When others splurged, it saved. When others sought to limit the role of government, Norway strengthened its cradle-to-grave welfare state.

And in the midst of the worst global downturn since the Depression, Norway’s economy grew last year by just under 3 percent. The government enjoys a budget surplus of 11 percent and its ledger is entirely free of debt.

By comparison, the United States is expected to chalk up a fiscal deficit this year equal to 12.9 percent of its gross domestic product and push its total debt to $11 trillion, or 65 percent of the size of its economy.

Norway is a relatively small country with a largely homogeneous population of 4.6 million and the advantages of being a major oil exporter. It counted $68 billion in oil revenue last year as prices soared to record levels. Even though prices have sharply declined, the government is not particularly worried. That is because Norway avoided the usual trap that plagues many energy-rich countries.

Instead of spending its riches lavishly, it passed legislation ensuring that oil revenue went straight into its sovereign wealth fund, state money that is used to make investments around the world. Now its sovereign wealth fund is close to being the largest in the world, despite losing 23 percent last year because of investments that declined.

Norway’s relative frugality stands in stark contrast to Britain, which spent most of its North Sea oil revenue — and more — during the boom years. Government spending rose to 47 percent of G.D.P., from 42 percent in 2003. By comparison, public spending in Norway fell to 40 percent from 48 percent of G.D.P.

“The U.S. and the U.K. have no sense of guilt,” said Anders Aslund, an expert on Scandinavia at the Peterson Institute for International Economics in Washington. “But in Norway, there is instead a sense of virtue. If you are given a lot, you have a responsibility.”

Eirik Wekre, an economist who writes thrillers in his spare time, describes Norwegians’ feelings about debt this way: “We cannot spend this money now; it would be stealing from future generations.”

Mr. Wekre, who paid for his house and car with cash, attributes this broad consensus to as the country’s iconoclasm. “The strongest man is he who stands alone in the world,” he said, quoting Norwegian playwright Henrik Ibsen.

Still, even Ibsen might concede that it is easier to stand alone when your nation has benefited from oil reserves that make it the third-largest exporter in the world. The money flowing from that black gold since the early 1970s has prompted even the flintiest of Norwegians to relax and enjoy their good fortune. The country’s G.D.P. per person is $52,000, behind only Luxembourg among industrial democracies.

As in much of the rest of the world home prices have soared here, tripling this decade. But there has been no real estate crash in Norway because there were few mortgage lending excesses. After a 15 percent correction, prices are again on the rise.

Unlike Dublin or Riyadh, Saudi Arabia, where work has stopped on half-built skyscrapers and stilled cranes dot the skylines, Oslo retains a feeling of modesty reminiscent of a fishing village rather than a Western capital, with the recently opened $800 million Opera House one of the few signs of opulence.

Norwegian banks, said Arne J. Isachsen, an economist at the Norwegian School of Management, remain largely healthy and prudent in their lending. Banks represent just 2 percent of the economy and tight public oversight over their lending practices have kept Norwegian banks from taking on the risk that brought down their Icelandic counterparts. But they certainly have not closed their doors to borrowers. Mr. Isachsen, like many in Norway, has a second home and an open credit line from his bank, which he recently used to buy a new boat.

Some here worry that while a cabin in the woods and a boat may not approach the excesses seen in New York or London, oil wealth and the state largesse have corrupted Norway’s once-sturdy work ethic.

“This is an oil-for-leisure program,” said Knut Anton Mork, an economist at Handelsbanken in Oslo. A recent study, he pointed out, found that Norwegians work the fewest hours of the citizens of any industrial democracy.

“We have become complacent,” Mr. Mork added. “More and more vacation houses are being built. We have more holidays than most countries and extremely generous benefits and sick leave policies. Some day the dream will end.”

But that day is far off. For now, the air is clear, work is plentiful and the government’s helping hand is omnipresent — even for those on the margins.

Just around the corner from Norway’s central bank, for instance, Paul Bruum takes a needle full of amphetamines and jabs it into his muscular arm. His scabs and sores betray many years as a heroin addict. He says that the $1,500 he gets from the government each month is enough to keep him well-fed and supplied with drugs.

Mr. Bruum, 32, says he has never had a job, and he admits he is no position to find one. “I don’t blame anyone,” he said. “The Norwegian government has provided for me the best they can.”

To Ms. Halvorsen, the finance minister, even the underside of the Norwegian dream looks pretty good compared to the economic nightmares elsewhere.

“As a socialist, I have always said that the market can’t regulate itself,” she said. “But even I was surprised how strong the failure was.”

Notice Norways revenue from Oil is lower than ours from Iron Ore. Surely anyone would agree that the above policy of creating a surplus and starting a sovereign wealth policy is smart.

 

[TheBloods]

You didn't address my points - Norway's income levels are no better than ours and their economic outlook is no better than ours. So how is their sov wealth fund making their situation better than ours?

BTW - that article is not correct. Norway doesn't have no debt. It has gross debt at high levels, as I noted. Its sov wealth fund nets part of it off, so no real difference to our debt position.

 

[nut]

You didn't address my points - Norway's income levels are no better than ours and their economic outlook is no better than ours. So how is their sov wealth fund making their situation better than ours?

http://www.slate.com/id/2108873/

BTW - that article is not correct. Norway doesn't have no debt. It has gross debt at high levels, as I noted. Its sov wealth fund nets part of it off, so no real difference to our debt position.

Norway Has close to $300Au Billion in it's sovereign wealth fund, I'd say that is close to being debt free.


Norway's Unemployment level is amongst the lowest in the world, it has a better education system, better health system, better pension system....etc..etc... The difference between the rich and poor is a lot less than here.

If our government controlled the direct revenue from the Iron ore industry and other natural resource industries which we have so much more of than Norway, then we could to have zero debt and Billions in the bank for a rainy day.

The difference is Norway is planning for the future, whilst we are living for today, hoping that the capitalism system will look after us.

Yes their income levels are close to ours because they have higher tax, but you are dismissing what they GET for this tax... they get BETTER education, BETTER health, BETTER pensions...and in lots of areas like transport etc they get better services.

We have the natural resources and our population is only 5 times more.. so the argument that we are too large is just stupid.

 

[TheBloods]

Norway Has close to $300Au Billion in it's sovereign wealth fund, I'd say that is close to being debt free.

Zero net debt, the same as Australia was.

Norway's Unemployment level is amongst the lowest in the world, it has a better education system, better health system, better pension system....etc..etc... The difference between the rich and poor is a lot less than here.

It achieves through high tax rates and social welfare transfers, not because it runs a sov wealth fund.

If our government controlled the direct revenue from the Iron ore industry and other natural resource industries which we have so much more of than Norway, then we could to have zero debt and Billions in the bank for a rainy day.

We had zero net debt when Rudd took over.

The difference is Norway is planning for the future, whilst we are living for today, hoping that the capitalism system will look after us.

Yes their income levels are close to ours because they have higher tax, but you are dismissing what they GET for this tax... they get BETTER education, BETTER health, BETTER pensions...and in lots of areas like transport etc they get better services.

That's an argument for more effective govt spending.

We have the natural resources and our population is only 5 times more.. so the argument that we are too large is just stupid.

Their govt income is higher per capita and their disposable income is no better than ours (prob lower).

You're just making general statements without addressing any specifics.

 

[nut]

Their govt income is higher per capita and their disposable income is no better than ours (prob lower).

You're just making general statements without addressing any specifics.

There are the MOST travelled population in the world. They ahve a higher disposable income because they get MORE from the tax they give, and thus dont have to spend earning on Private health, private schools, save for retirement etc.. The tax they give is like a forced savings. They also have a strong currency that is worth more when travelling...

 

[TheBloods]

There are the MOST travelled population in the world. They ahve a higher disposable income because they get MORE from the tax they give, and thus dont have to spend earning on Private health, private schools, save for retirement etc.. The tax they give is like a forced savings. They also have a strong currency that is worth more when travelling...

Again, you're not addressing the specific issues.

 

[nut]

Again, you're not addressing the specific issues.

??? So it's all about take home pay is it??? what about quality of life and standards of living for the entire population??

Please be more specific. I thought the articles were pretty specific, were they not?

The previous government was very smart and reduced our debt levels to zero. They achieved this largely due to increasing tax's with GST and the money received from the mining boom.

Where they went wrong was becoming too reliant on these NEW forms of revenue and going one step further by actually giving the tax back with it's middle class welfare, whilst still increasing spending. Especially on Military (Iraq war) etc....

What they should have done was to use the revenue from the mining boom in a similar to the way Norway has with it's natural resource. Investing the money in Bonds etc.. and creating long term wealth like Norway is achieving with it's Sovereign fund.

The thing is it's a cultural thing. Australians what thing s NOW. Norway set this fund up over 30 years ago.... we cant wait that long... we need to spend the cash now...

 

[TheBloods]

The specific issues you're not addressing are the ones I raised above. You said that the government should be running a surplus because we'd be in a better position than we are now, and you cited Norway as the (single) example. However, you've not stated how we'd be in a better position specifically and it is not evident at all that Norway is in a better position, and if it was that it's because of the sovereign wealth fund.

 

[nut]

The specific issues you're not addressing are the ones I raised above. You said that the government should be running a surplus because we'd be in a better position than we are now, and you cited Norway as the (single) example. However, you've not stated how we'd be in a better position specifically and it is not evident at all that Norway is in a better position, and if it was that it's because of the sovereign wealth fund.

Norway that "single" example Is enough proof that I am right because every other country is going back wards...


We would be in a better position because we would be able to invest now for much greater returns like Norway is doing.... doing the opposite to what everyone else is doing usually works. Saving our money for the next downturn is what we should do...

The Iron WILL run out, china can stop buying at anytime... WHAT THEN? what happens to our nation when the mining companies pack up and piss off. Were will our revenue come from?? We are living above our means, as the budget deficit has shown once the revenue from Iron dropped.

We may as well pretend that we dont get that revenue, yes we would have to tighten our belts, pay higher taxes, but we would be saving for the future..

It would be political suicide in a country like ours that has had every handed to it on a plate... we live in a society that is more interested in our selves than others, so to ask our population to save for future generations would be the hardest thing any political party could do.

 

[TheBloods]

Norway is going "backwards" the same as the rest - I've already said their GDP forecast is a decline of 1.9%.

You still haven't explained how the govt taxing people more and using the proceeds to buys equity and debt is better than people buying equity and debt with their own money?

You still haven't addressed why we'd be better off now.

 

[nut]

Norway is going "backwards" the same as the rest - I've already said their GDP forecast is a decline of 1.9%.

You still haven't explained how the govt taxing people more and using the proceeds to buys equity and debt is better than people buying equity and debt with their own money?

You still haven't addressed why we'd be better off now.

Because the Government in Norway is more responisible than the people of Australia. They have saved more. Why do you think we have super??? because we cant be trusted to save for our retirements.

And...

BECAUSE THEY HAVE HIGHER STANDARD OF LIVING.

They have MORE welfare benefits, They dont need a Private Health care system that is designed to make huge profits, they have a LOW unemployment level, the have HIGH standards of education FOR EVERYONE not just the ones who can afford it.

When someone is sick they are looked after with income protection ect..etc..

Why do you see these things as a burden on "your" taxes. Why dont people see these things as a investment into the security of it's population.

High education, High Health for all.. and a system to protect you if life gives you kick in the guts.

Ye there will be a small minority that will abuse the system, but the population of Norway has grown to respect and are proud it's Welfare programs.


So lets pay higher taxes for a higher standard of living...

 

[TheBloods]

Saying it with caps lock doesn't make it right. As demonstrated, they appear to have lower levels of real disposable income.

More importantly though, there is nothing to suggest this sovereign wealth fund has created this higher standard of living and you still haven't justified why the government is better placed to invest than the people are.

Your comment about super and government savings is non sequitur.

If we start paying higher taxes we won't necessarily get a higher standard of living. More likely we'll get a great level of government wasteage. Italy has much higher tax rates but it's not doing their economy or social welfare programmes that much good.

 

[nut]

Saying it with caps lock doesn't make it right. As demonstrated, they appear to have lower levels of real disposable income.

More importantly though, there is nothing to suggest this sovereign wealth fund has created this higher standard of living and you still haven't justified why the government is better placed to invest than the people are.

Your comment about super and government savings is non sequitur.

If we start paying higher taxes we won't necessarily get a higher standard of living. More likely we'll get a great level of government wasteage. Italy has much higher tax rates but it's not doing their economy or social welfare programmes that much good.

Norwegians Travell more than ANY other


FFS.... I think you are thinking of your self... and wether YOU will get a higher standard of living. Norway has NO poverty. Norway has Free Education and has Free Health. FOR ALL.


Well Italy and corruption goes hand in hand. Government wastage is something that we all should make them accountable for.
The 1 Billion dollar Nauru detention centre is one.

 

[TheBloods]

You are talking rot now and reveting to hysterical comments without even posing relevant or sensible arguments.

Norway does have poverty, it's just much lower than everywhere else. But people in poverty here are a very small proportion of the population and simply thinking raising tax rates will alleviate is rather simplistic to say the least. Same with education and health care. They could be covered within existing government revenues if better managed or with just a small increase. Most people in Australia get free health care - Medicare.

You still think that raising taxes will produce a magical wonderland.

That is still not the relevant issue here.

You still have not addressed the issues. How does the government running a surplus and creating a sovereign wealth fund improve their position now? How is their position now better than ours when they are also facing declining GDP?

 

[nut]

How does the government running a surplus and creating a sovereign wealth fund improve their position now? How is their position now better than ours when they are also facing declining GDP?

Because they can pay for it's stimulus package with cash and not have to borrow, they can also invest with it's fund in a weak market and get higher returns when the rest of the world is screaming for finance. They can also use it to invest into future industries and prepare for when the Oil runs out, just like we could with our Iron ore and countless other natural resourses.

As investors the world over sold in a panic, she bucked the tide, authorizing Norway’s $300 billion sovereign wealth fund to ramp up its stock buying program by $60 billion — or about 23 percent of Norway ’s economic output.

“The strongest man is he who stands alone in the world,”

Surely you can see that due to Norways Sovereign fund that every man women and child in Norway is better off now and in the future.

Why dont you want the same?

 

[TheBloods]

Because they can pay for it's stimulus package with cash and not have to borrow, they can also invest with it's fund in a weak market and get higher returns when the rest of the world is screaming for finance. They can also use it to invest into future industries and prepare for when the Oil runs out, just like we could with our Iron ore and countless other natural resourses.

Firstly, paying for a stimulus package with debt or paying for it with cash which you have taken from taxpayers is the same thing. Governments are not in the business to invest in equities or debt - it's not what they do - that's what the private sector does. When have governments been the right organisation to pick winners in industries?

Surely you can see that due to Norways Sovereign fund that every man women and child in Norway is better off now and in the future.

Why dont you want the same?

It's NOT because of the sovereign fund. You have not presented a single argument why a government investment fund has made Norway better off. Why is it better for this money to be invested by the government rather than by the people?


BTW - the word is --its-- not --it's-- when using possessive pronouns.