The purpose of this thread is two fold....
1. even tho I voted labor, I am a firm believer in small govt and I am hoping that Rudd can deliver. (the howard govt's spending was described by access economics yesterday as 'whitlamesq' , and certainly Costello was not impressed by Howards philanthropy)
2. with the recent labour shortages and bottlenecks, now is the right time to have a lean and mean govt.
To start off with, i'm pro the tax cuts, and in fact would like to see that go further... but what I would like to see is the tax cuts being funded from savings, rather than simply handing back once in a life time company tax, which is not only unsustainable but fuels inflation.
In the 7:30 report last night, the chap interviewed said at least 10b a year in saving need to be identified...Access Economics is warning the new Federal Government that the tax cuts it promised will boost interest rates. The Coalition promised $34 billion in tax cuts and the Labor Party matched $31 billion of that pledge.
But Access Economics says delivering on those commitments will push up interest rates unless there are extra spending cuts. It says adding another tax cut to an economy already at full stretch does not boost the size of the economy and create more jobs. Instead it brings a bigger import bill and higher prices.
Mr Richardson says the Government should look at means-testing some welfare spending and finding savings in national security.
"It is politically difficult," he said. "Partly it's difficult because people understand the need for tough decision when things are tough, but they don't understand the need for tough decisions when things are prosperous as we are now.
"We saw the big spending by the Coalition in recent years pushing up interest rates. "The Government's inherited the same policy mix. It needs to break that stance."
Treasurer Wayne Swan says wasteful spending in recent years means this Government has inherited a substantial inflation challenge. He says it has strengthened his resolve to identify savings above the $10 billion Labor's already found.
So.... What do you see is the role of Govt.... which should lead into the next question... where should govt spending be cut from?
As I put briefly in another thread.... in my opinion, Govt's need to focus on a few key things
3. Security (national, local and personal)
4. Social Safety Net
5. Infrastructure (Water, Electricity, Communications (roads, rail, broadband), etc)
6. Various laws, rules and regulations (basic IR rules, criminal law, torts law, competition/consumer laws, environmental laws, etc).
That is it... The rest should be left to individuals.... Middle class welfare HAS TO GO. All govt services provided to individuals (as per Social Safety Net) should be on a voucher based system, not cash. If special assistance for those with children has to be provided, that should be on a voucher based system too.
Is there anything else that they should be doing??
And, what would the govt budget then look like, and how many more people would be available in the workforce then? Could it also then be possible to simplify the tax system, to have a simple two tier system, or even a flat tax like company tax?
PS: and yes, I know I am dreaming cause this ain’t ever going to happen…