Answers for Adam: Should the budget prompt us to be more generous?
After the government passed down an belt-tightening budget Adam Ferrier asks if this act should make people more generous in sharing their wealth?
Here’s a question relevant to you the day after budget night.
The government has largely followed convention and is in the process of creating a smaller government, and freeing up corporate Australia to create more money that will then be distributed to the masses. That’s kind of the reasoning – I think.
Interesting and very pertinent, Adam. Whilst the global Internet companies siphon money out of Australia via tax shelter holding companies and pay a ridiculously small amount of tax here, the rest of us have to stump up more. I’m not against taxation per se, but it makes me sick to see the ATO outwitted by the protagonists in the Myer float. Philanthropy has long been a tradition in the US, when the robber barons such as Rockefeller wanted to clean up their image for posterity, but here in Australia the tradition is not so strong.
That great Australian, Dame Elisabeth Murdoch, made a point of being very public about her philanthropy in order to encourage others. Some make an effort, such as Twiggy Forrest re: indigenous training and employment, to address these things using their corporate clout, but then again I can’t speak for his tax minimisation strategies.
The oft-made argument is that if you tax the top end of town too highly, they’ll pull up stumps and settle elsewhere. For the most part, let them go. Entrepreneurs are needed here, but financial wizards and c-suite players are not so necessary and are easily replaced.
The small v big government argument is at the core of any political dialectic, but what both sides seem to lack right now is communicating what they are actually going to do with this debt or surplus. Reducing debt seems to be an end in itself, yet as Satyadit Das pointed out on Monday’s Q&A, our debt to GDP ratio is actually very low. This seems to be a smokescreen for the libs to push through their commission of audit agenda.
Rich people with money? I remember reading about a millionaire (when it meant something) who bragged he made it a mission to never pay for lunch. How noble.
For my part, I donate my time to an NGO once a fortnight, and also provide marketing services pro bono where I can. Sometimes its not just about the money.
Governments (of both major parties) cut budgets so they can avoid having to tax business. If you need to know why simply google “political donations Australia” and you should not having too much trouble joining dots.
Now given that business has made these donations specifically because its cheaper than paying tax, do you really think they are then going to “match” the taxes they just went to great lengths to avoid out of the goodness of their own heart.
Even if you do believe in fairys, do you really think that the private citizen/private company actually has the faintest idea of what government spending priorities should be? Or is it far more likely they will donate to their favourite hobby horse while the far more crucial services suffer?
Something to ponder when your next waiting for 6 hours in an emergency department for someone to see your kid about their broken arm. Buy hey…I hear charity X just got celebrity Y to be their spokesperson? Woopedy do.
My answer in the end would be yes. But its a shame. Cuz Joe citizen is a bit of an idiot when it comes to taking of his middle class glasses and figuring out which social needs are really being unment and which just appeal to him.
We’re such relative creatures that there probably shouldn’t be much surprise at all the evidence that the level of inequality in a society leads to an overall drop in societal happiness. And clearly most economies are becoming less equal.
But perhaps less counter-intuitive is that giving or spending money on others actually makes us happier than spending on ourselves (try http://danariely.com/tag/gift-giving). So do something selfish today – spend your money on someone else!
When a government can’t be bothered being honest before an election about their plans and methods of implementation, they are clearly giving us all the finger.
They have set the tone for the country, and it ain’t one where the well off run around looking for poor but worthy people to help.
It’s more likely to make us a nation of greedy Gollums, holding tightly to what we have, while screaming “mine!” at anyone who comes near.
Adam you’ve got to be kidding. You should stick to consumer psychology and leave the economics and finance to the numerate
the single largest govt expenditure is welfare payments
only half of our 12 million tax-paying households actually pay net tax
only half of our 12 million tax-paying households are paying for the social infrastructure that we all take for granted
the budget only exists to tax the middle class and affluent, and give that money to others
this is the great wealth redistribution that occurs in Australia – it’s all one way, as any undegraduate eco student can tell you
this budget does not “take” the money of pensioners, jobseekers etc. It makes it harder for them to get something for nothing out of the taxypayer
@Neville. The fully efficient economic model presupposes the human unit as an entirely rational being. It does not take into account the massive distortions created by greed and corruption.
It is only recently that people such as Kahneman, Tversky, Piff, Ariely, Ferrier et al. have elucidated that phenomenon known as ‘behavioural economics’ and its subset, ‘consumer psychology’, which take irrational elements including greed and corruption – at both ends of the socio-economic scale – into account.
What is the actual point of your comment? Is it that 100% of households should be paying net tax? Is that too extreme an interpretation of your comments? Do you have a figure for the ideal proportion? Does merit enter the equation?
Can your precious numeracy pinpoint the exact threshold of decency in a country like ours?
This may sound quaint or OTT do-gooder but when on occasions my bank balance has been perilously low, I increased my donations to meaningful (to me) charities and increased my volunteerism. Logic would suggest going in the other direction.
But it was an amazing pick-me-up which restored my sense of purpose other than generating income. I also had good support networks which never left me with a sense of nowhere to go. Giving to others – whether it’s time, money or energy – is a foundation of resilience when life can take an unexpected rotten turn.