All posts by Senor3

Corporate tax cuts

The business lobby could never be accused of lacking persistence.

I note further calls from the Business Council for corporate tax cuts based on a recent visit to the US by the Council’s CEO and meetings held there with, among others, business leaders and fellow lobbyists who reportedly advised that there was no major domestic US opposition to such action as an integral element in President Trump’s taxation reform proposals. Quelle surprise!

This feeds into the argument that in light of this prospective US action similar moves must be made in Australia so as not to suffer a lack of competitiveness in attracting capital investment. Consistent with previous similar calls for action in this country there is little or no attempt to justify this assertion by assessment of the differing circumstances in both countries in their respective tax system or capital formation and attraction experience. This ‘we must avoid the resulting reduction in competitiveness’ proposition is simply put and has increasingly assumed the status among its adherents of incontrovertibility.

Well, here’s an idea…

Let’s adopt the Council’s (and by extension the Federal Government’s) argument and reduce corporate tax rates to a level that would be inarguably competitive, say 10% for all companies.

At the same time, however, let’s repeal all allowable deductions to be set against corporate taxable income except for those that are directly attributable to the generation of that taxable income; payments of salary and wages to employees engaged in producing a company’s income would be a good example of a continuing allowable deduction.

On the other hand, donations to political parties, as an example, would no longer be an allowable deduction. Happily this would kill two birds with the one stone – remove a deduction that almost never is essential to producing a company’s income and at the same time achieve the desirable elimination of corporate donations to political parties, which many would claim to be a source of potential perverse harm in our democracy.

It cannot be beyond the wit of our Government leaders and senior bureaucrats to develop a code of allowable deductions under this changed system and administer it fairly. Adoption of this idea would also remove one of the major objections to the ongoing call by the business sector for reductions in the rate of taxation applied to their operation – the fact that already very many Australian corporates in any case do not pay taxes at anywhere near the currently applicable rate!

America and the English language

Recently, I was wandering through an article in the prestigious US magazine The New Yorker that dealt in essence with a controversy swirling around the US cable sports network ESPN as to where it sits in the ongoing cultural/racial war that seems to have been substantially generated by the election and subsequent actions of President Donald Trump.

In that article reference was made to a comment by a James Andrew Miller, who the article said “co-wrote the definitive oral history of ESPN”. Initially I did not give this much thought, however on reflection the obvious question arose in my mind – how does one write an “oral history”?

I think I am clear as to what is meant – presumably a written history based on oral information. Nevertheless, I was surprised that this clumsiness escaped the attention of the editors at The New Yorker, a publication renowned for being a stickler when it comes to the rights and wrongs of English expression.

This led me to thinking about other English usages in the US that appear to be widely accepted but which sometimes trouble the ear of other English speakers. Probably my favourite is the term “momentarily”. I recall during an internal airline flight in the US an announcement by the pilot that we would be landing in Chicago “momentarily”.   I turned to the (US) occupant of the next seat and commented that I hoped that we would be in Chicago a little longer that that. This observation was met with obvious puzzlement on my travelling companion’s part.

Maybe the contradiction in terms overlooked by The New Yorker has its roots in sports writing and commentary (a field rich in the mangling of language which has been plowed enthusiastically by many a reviewer). As but a minor example I am a regular viewer of TV coverage of the US golf tour and am frequently informed by the commentator of the composition of “pairings” of competitors only to find that in fact the group comprises three rather than two members.

Then again, in the sporting arena maybe this is not unique to the US. Track events in athletics meetings in Europe more than occasionally are said to be at the semi-final stage, which turn out to involve not two qualifying races for the final but three.

In defence of us all, however, possibly it is wise to bear in mind the view of English attributed to the US journalist and columnist, Doug Larson –
“If the English language made any sense, lackadaisical would have something to do with a shortage of flowers”.

Marriage equality

Incredibly here in Australia we continue to be subjected to an ongoing debate as to whether certain persons of the same sex, most of whom presumably already cohabit relatively formally, should be allowed to marry.  Sometimes Australian society and its institutions exhibit characteristics beyond rational explanation.

Of course, and in defence of the wider community, we all know that the fact that there is a continuing question about this seemingly simple proposition is a product of a government that holds positions that fly in the face of the views of that community (currently it seems that something around three-quarters of the population are in favour of marriage equality), and results from the impotence of an increasingly weak leader struggling to paper over a government that is wracked by multiple schisms.

Among a range of reasons advanced by those opposed is a claimed concern for the children of same sex relationships, expressed as “I believe that it is best for children to be raised by a biological mother and a biological father”. Note the term “I believe”.

I have yet to hear any proponent of marriage equality argue that this belief should be denied to those that hold to this position. If that is their belief they should be entitled to follow their conviction in how they manage their lives and relationships. That should not, however, extend to foisting their beliefs on others in circumstances where the adoption of a different view does not have any negative impact on their ability to adhere to their life choices.

I might have missed something here but I do not recall any suggestion that same sex marriage should be compulsory for all.

Honest self-analysis would suggest that I am not totally comfortable with the concept of same sex relationships, no doubt a product of cultural and religious influences over seven decades. Why should that be a relevant factor, however, in the commitment choices others make about how to pursue their own happiness and fulfilment.

In fact, why is it a question for our so-called political leaders at all?

Online course – Yale University – Moral Foundations of Politics

While completion of this course of study does not bring any formal qualification, the range of the material covered and the erudition of the course leader, Prof Ian Shapiro, results in a very worthwhile broadening of one’s understanding of many of the influences that have moulded today’s western political systems.

As importantly, for this participant it proved to be a very useful means of keeping the “gray matter” turning over, as one measure of keeping mental deterioration at bay!

To see course completion certificate click on link below.

Yale-Moral Foundations of Politics-Course completion certificate

On growing old

Earlier this year I became 70.  Equal to the life term specified in the Bible this is no longer considered to be what we should expect as all manner of medical, lifestyle and diet improvements have resulted in a substantial extension in the average time the majority of those of us fortunate to live in the First World can hope to inhabit the Earth. The fact that this happy outcome cannot be assumed by many of our fellow inhabitants dealing with the less favourable living conditions in the many countries in the Third World grouping has minimum impact on our determination to extend our own lives to the maximum.

In the words of the old joke “the only individuals desperate to turn 80 are the 79-year olds” (insert your own preferred numbers).

Am I desperate to turn 71, and thereafter a further additional year? Having done so for a number of more years when will I be satisfied that I have lived to an optimum age?

I was recently reminded of an observation by a character in American novelist Marilynne Robinson’s Pulitzer Prize winning novel ‘Gilead’, one Reverend Ames – “It is worth living long enough to outlast whatever sense of grievance you may acquire.”  As Peggy Lee might have sung in response “is that all there is?” (here).

I have acquired several grievances over my 70 years.  Some I believe will never be outlived.  They have had too great an impact on what I had hoped to achieve and on the lives of those that are of the utmost importance to me.  I have also been incredibly lucky, particularly in having the love of my family.  So in contemplating how many additional years I might wish for I would ask that the following be the determinants –

  • That my wife outlive me.  This is entirely selfish, reflecting the fact that I could not bear the pain of witnessing her death.
  • That my two children also outlive me for a similar reason, but also because they are outstanding human beings that have much to offer and should be allowed to do so.
  • That I live to witness my grandchildren (currently aged 1-10) blossom.
  • That I do not live into dementia.
  • Finally, that I live to see Australia accept the burden of maturity and enthusiastically choose to become a republic.

 

Only in Canberra

There is currently in the nation’s capital a controversial debate swirling around a plan by the incumbent government – a Labor/Greens coalition – to design and construct a light rail public transport system that would run through the middle of the city but would service only the northern half, from the suburb of Gungahlin to the Civic centre. This 12-14 km link is costed at something approaching 1 billion dollars.

Adding to the controversy the current Liberal Opposition has made clear for some time that it is opposed to the light rail plan and should it win government at the next election, scheduled for late 2016, it would seek to cancel the project and any contracts that have been entered into as part of the project’s implementation.

This has excited comment from a number of quarters, including criticism by a Federal Liberal Minister in which he has accused his ACT colleagues of “economic lunacy”. There is more than a little politics in this, given that the Federal Government and the Prime Minister have been vociferous in their criticism of the action of the recently-elected Victorian Labor Government in cancelling a major road project approved and contracted by its Liberal predecessors, an action that Labour in opposition made very clear it would take and which the Victorian electorate had very definite knowledge of prior to the State election.

So the position is more than a little muddy with normally natural allies taking opposing positions. There has also been widespread comment from the community itself, with support and opposition being strenuously expressed both publicly and privately.

In an effort to bolster the project support case the local union movement, in favour of the project both because it is a Labor proposal and because it hopes that the plan’s implementation will result in an increase in jobs, conducted a telephone poll.  A report on the results of this poll can be seen here.  Unfortunately, for the project’s supporters  the greater number of respondents to the poll were against the light rail plan.

Enter academia, of which Canberra is blessed with a preponderance. A contribution to the debate and specifically to the unfortunately negative poll results was penned by two academic supporters of the proposal.  This can be seen here.  Their essential point was that the poll results were only negative because of the impact of negative responses expressed by intending Liberal voters and if they were excluded then magically the poll results would have been positive.

One would have to say that this is a proposition that is staggering in its naivete.  It is almost charmingly guileless in its disregard of the obvious flaws in such an analysis, including the possibility (probability?) that respondents indicating that they were likely to vote Liberal were intending to do so precisely because they opposed to the light rail plan.  The cause was the light rail plan and the result was an intention to vote Liberal, not the other way around.

Additionally, did it not occur to these ivory-tower dwellers that any similar exercise that excluded intending Labor voters would result in overwhelming rejection of the proposal?

This has now raised the intriguing possibility for all our politicians – if they suffer an adverse poll just exclude all negative respondents and all will be well.

I am astonished that anyone would seek to reinterpret poll results in this way, especially individuals whose education and position should lead them to know better.  I am utterly astounded that they would then seek to have this exercise actually published, potentially opening them up to ridicule.

Only in Canberra!

 

Electoral Reform 2

Previously (May 06) in the context of the recent British Election and the first past the post (FPTP) election process employed in the UK I made some comments in relation to possible electoral system reform in Australia.  In the event my remarks concerning the potential for FPTP to result in some success for other than the two major political parties – Labour and the Conservatives – were not reflected in the election outcome, which saw the Conservatives win a majority of seats and thus the power to govern in their own right.

In my defence I was not the only observer surprised by the result, with all the major UK polling organizations embarrassed by the gap between their predictions and the ultimate reality.

The concept of smaller parties profiting by the vagaries of FPTP was not entirely rejected by the UK results, however, if we consider the success of the Scottish National Party (SNP).  Garnering only 4.7% of the national vote, SNP won 95% of the seats it contested (56 of 59), all in Scotland.  Before it is said “yes, but that is just Scotland nationalism” it should be understood that this result was based on a minority of the votes cast in those 59 electorates, albeit by a very small margin.

Further, with a swing to it of just 3.0% the SNP increased its representation from six to 56 seats.  It did so by concentrating its focus and resources in specifically targeted electorates, an obvious strategy given that its rationale is to pursue policies of direct and specific interest to the voters in those electorates.  This strategy was in no way encumbered by the FPTP voting system; indeed 23 of the SNP’s seats (over 40%) were secured by less than a majority of the votes cast, with several recording successful votes in the mid thirty percent.

The opposite of the SNP strategy was that adopted by the Liberal Democrats (erstwhile coalition partners of the Conservatives) and the UK Independence Party (UKIP) both of which contested all 650 seats, thus spreading both focus and resources over the entire electorate.  Both attracted a significant volume of votes but were singularly unsuccessful in securing seats.  The lesson for these parties is clear – for as long as FPTP is the basis of the UK system they must keenly target seats and not diffuse their resources (and message) over numerous seats which they cannot hope to win.

Which brings us to the major associated outcome of the UK election – widespread criticism of the obvious inequities of the FPTP system.  Looking at the major political parties the bias in favour of the majors is clearly demonstrated by the fact that the Conservatives require only an average vote of 34,244 to secure a seat; Labour requires 40,277; the Liberal Democrats require 301,986; and the UKIP and the Greens, with one seat each, require votes in the millions.  To complete the picture, SNP requires only 25,972 votes to secure a seat.

Coupled with the fact that in the UK 2015 FPTP election the Conservatives gained 24 seats on an increase in its vote of less than one per cent, while Labour increased its vote by 1.5% but lost 26 seats, this should suggest that, whatever might be the future of electoral reform in Australia, FPTP will not be  part of any change.

Electoral Reform

Currently, there is a good deal of debate in this country surrounding the appropriateness/adequacy/fairness (pick your preferred descriptor) of the various electoral systems that operate in both the Federal and State jurisdictions.  Much of this has been prompted by the claimed obstruction of the incumbent Federal Government’s policy mandate by “feral” Senators who have been elected not as a result of the public’s democratic preference but rather as an outcome of “behind closed doors” preference swaps orchestrated by professional electoral system gamers.

Some observers, frequently not without a party political axe to grind, contend that this unintended representational outcome would, at least to some extent, be overcome by the introduction of a first-pass-the-post (FPTP) voting system under which the candidate having the most votes after the first count of ballot papers would be declared the winner.

To a considerable extent this position was prompted by the experience of the recent Queenland State election where after the first count the then LNP Government led on FPTP terms in 51 of the 89 seats but after the distribution of preferences lost sufficient of those first preference leads to other candidates to lose the ability to form government, which enabled the ALP to do so, albeit with the support of an Independent.

Many LNP supporters considerd this unfair and suggested that an FPTP system would have better reflected the will of the voters.

With respect, this is nonsense.  Consider for a moment the situation where in a particular electorate there are five candidates contesting a tight contest.  One of the candidates receives 22% of the vote with the other four sharing the remaining 78% in roughly equal proportion but with no one candidate receiving more than 20%.  It should be obvious that there is nothing fair about the declared successful candidate being elected with 22% of the vote when fully 78% of the elctorate was against that outcome!

There is a another possible outcome under FPTP that suggests its suporters should be careful about what they wish for.  In making this point I am indebted to Prof Patrick Dunleavy, of the Institute for Governance and Policy Analysis at the University of Canberra and Professor of Political Science at the London School of Economica and Political Science  (see UK election spells the end for the biggest ‘law’ in political science) and also to The Conversation (see  https://theconversation.com/au) where his article was published.

In his article Prof Dunleavy suggests that in a number of western democracies FPTP voting systems are increasingly producing multi-party outcomes; that in very few electorates in tomorrow’s UK election will the successful candidate secure more than 50% of the votes cast; and that this progressive move way from the electoral dominance of the two major parties in favour of smaller parties (in the UK the Scottish National Party, the UK Independence Party and the Greens) may well persuade the incoming Government to consider elctoral reform that could incorporate some form of proportional representation.

Proponents of FPTP in Australia, beware!

I will review the UK election outcomes and consider whether Prof Dunleavy’s predictions prove to be correct and what that might mean for those promoting electoral reform in Australia.

 

Sad, tragic but no time for woolly thinking

The sudden and accidental death of Phillip Hughes after being hit by a cricket ball is desperately sad, a tragedy for the young man and his family.  These are not the sorts of outcomes that are expected from a game of cricket, no matter what level of competition.

As many have said Mr Hughes’ death certainly puts into perspective the importance or otherwise of success in sporting endeavour. The famous comment by Liverpool Football Club Manager, Bill Shankly that –

Some people believe football is a matter of life and death, I am very disappointed with that attitude. I can assure you it is much, much more important than that”

rings very hollow when placed against the events at the SCG on Tuesday of this week.

This is no time, however, for the sort of woolly thinking that has led to the relatively widespread contention that this tragedy should result in the cancellation of the First Test against the Indian cricket team scheduled to commence next week.  While the shock and almost despair of the first-class cricketing fraternity is understandable, what is to be served by such a decision?

More importantly, this train of thought suggests an absence of consideration of what would be the view of Mr Hughes himself, were he in a position to comment.  Surely, as one of Australia’s finest with a strong regard for the game (witness his determination to return to Test cricket, having previously been dropped from the team no fewer than three times) he would see the central importance of moving forward.

Additionally, if the cancellation of the First Test is in some way intended to be a mark of respect for Mr Hughes does this not at least infer that it will be alright to recommence Test cricket a little later, after his death has been somewhat forgotten. When might that be?  How quickly might we forget?

I would argue that the next week’s Test should be held as a celebration of the life of Phillip Hughes to ensure that he is remembered not just next week but during every future First Test of the summer.

There is of course the question of whether or not those likely to be selected to play in the First Test Australian team feel that they are able to do so.  This will depend on individual circumstances and the degree to which each individual has been affected by the tragedy.  This should be managed by Cricket Australia making clear to each individual selected that the decision to play or not is a matter for each person and whatever each decides will not be a factor in future selection prospects.