Was the housing boom in Sydney and Melbourne driven by foreign buyers?

Ross Guest and Nicholas Rohde (Griffith University) explain in The Conversation that foreign investment was only a minor factor in the decade long boom in Sydney and Melbourne and housing affordability.

How the ‘fair go’ became the last bulwark for Australia’s freedoms

Gillian Triggs (University of Sydney, Human Rights Commission) writes in The Conversation that successive governments and political leaders since 2001 have played on community fears of terrorism and the unauthorised entry of refugees to concentrate power in the hands of the executive – to the detriment of Australian liberty. Most Australians are unlikely to be able to describe the doctrine of the separation of powers, but they’re quick to assert their liberties under the rubric of a ‘fair go’.

Interest rates could stay low for decades

Rodney Maddock (Monash University) writes in The Conversation that saving has tended to increase and investment to fall; more money is available but fewer people want to borrow, thus driving down rates. The trends will not likely change abruptly so we can expect low rates for a long time.

Unwritten rules shape ministerial accountability

Ryan Goss (Australian National University) writes in The Conversation that Australia’s constitutional system is built on the assumption that all ministers will be responsible to the parliament and, through the parliament, responsible to the Australian people. But there’s no precise legal statement of how that assumption works, what it covers, and what happens if the ministers are not sufficiently responsible. It’s incumbent on all of us, as citizens in a democratic society, to ensure that our representatives hold our government to account.

We all have a role in protecting democracy’s unwritten rules

Danielle Celermajer (University of Sydney) explains in The Conversation that our democracy is only safeguarded by informal conventions and the robustness of our political culture. When the actions and words of our leaders model an ethos where political differences are more important than democratic conventions, we’re all enfeebled.

Mutated conventions: how secrecy in the name of security harms democracy

Jude McCulloch (Monash University) writes in The Conversation that secrecy is a weapon of information control that valorises official stories and outlaws those who expose governments and police and security agencies to scrutiny.

Confusion reigns in options for Australia’s misuse of market power laws

Stephen King explains reforms to the misuse of market power laws in The Conversation and deficiencies in the Government's options paper.

Yes minister: how political appointments tip the scales of fearless advice

Chris Aulich (University of Canberra) writes in The Conversation that the public service has gradually become more politicised in recent years. But this is a bigger problem for agencies broadly described as integrity agencies and for bodies where public perception of neutrality are important to their operations.

Innovation statement’s significant insolvency changes are well overdue

Jason Harris (University of Technology Sydney) and Michael Murray (Queensland University of Technology) explain the proposed insolvency law changes in yesterday's innovation statement.

Innovation package just gets us back to square one

Mark Dodgson (University of Queensland) writes in The Conversation that faith in innovation policy in Australia over the last 30 years has continually been dashed—wrecked on the reefs of institutional inertia, political myopia, management gaming and bureaucratic incompetence. The prime minister has placed a great deal of political capital in promoting the innovation agenda, but success in this area will require his continued and forceful leadership if we are not to repeat the mistakes of the past, and lose the momentum he has created.

Australia’s innovation problem explained in 10 charts

Charis Palmer, Darcy Shilton, Emil Jeyaratnam and Wes Mountain (staff at The Conversation) explain why Australian has a long way to catch up to its regional and global counterparts, and identify the biggest innovation challenges.

Following suit: why political conventions matter

Richard Mulgan (Australian National University) explains in The Conversation that political conventions may be challenged and redefined by every new government, but it is their role in promoting political accountability that ensures the health of our democracy.

Government policy, not consumer behaviour, is driving rising Medicare costs

Stephen Duckett (Grattan Institute) writes in The Conversation that Medicare expenditure was presented in the 2014 Budget as part of the government’s mantra of a “debt and deficit disaster”, and massaged to create maximum shock and awe. The minister’s numbers did not adjust either for population growth or inflation. Furthermore, of the $325 real increase in MBS spending per head since 1993-94, all but $74 has been the result of explicit government decisions.

Why levying GST on banking has been in the ‘too hard’ basket

Kevin Davis (Australian Centre for Financial Studies) explains in The Conversation the complexities in levying GST on money lending. The relevant tax base is the sum of profit and wages paid (i.e. the value added) of banks, which is a very large sum and largely not subject to GST. In addition, the banks currently pay large amounts of GST (on their purchased inputs), much of which they cannot claim as input tax credits. Consequently, the cost of financial services is lower for consumers (around $3.5b) and higher for businesses (around $1b) than if GST applied similarly to other services. Also, the GST revenues for the States are also much lower, as money lending is a large segment of the economy.

Virtues and pitfalls of China’s state-driven growth

China’s model for growth has been enormously successful, but it comes with some unresolved risks. Yukon Huang looks at how China has recorded double-digit growth for more than three decades, and why it’s now slowing down.

Is welfare spending really unsustainable?

Peter Whiteford (Australian National University) has provided an excellent analysis of social welfare payments for Inside Story. He concludes that political and media concerns about relentless growth in welfare are difficult to substantiate – particularly when the total number of welfare recipients is close to its lowest level in the past twenty years.

Harper response is good economics and smart politics

Stephen King (Monash University) writes in The Conversation that the Turnbull Government's response to the Harper competition policy review is mature and thoughtful. It reflects the recent changes in Canberra. It should be welcomed by both the opposition and the states. And, while the Hilmer reforms underpinned the last 20 years of Australia’s economic growth, this response to Harper should underpin the next 20 years.

How to lose the war on terror: panic and feed Islamic State’s narrative

Terrorism is designed to turbo-charge our emotional buttons. It is not only about violence but the threat of future violence. Daniel Baldino (University of Notre Dame) writes in The Conversation that we are only compounding problems by hyping threats, searching for extraneous scapegoats and indulging in fear-based decision-making.

Lazy tax reform - increasing GST to cut income tax - would likely be a zero sum game

Flavio Menezes (University of Queensland) writes in The Conversation that tax reform will certainly be challenging, but we should go beyond lazy reform – increasing the GST as part of a tax mix switch strategy that is likely to have limited impact on growth – and instead be innovative and bold.

As drought looms, the Murray-Darling is in much healthier shape – just don’t get complacent

James Horne (Australian National University) writes in The Conversation that Melbourne Cup Day is a significant day in the history of water policy in Australia. The first Tuesday in November 2006 saw the then Prime Minister John Howard intervene decisively in the growing drought crisis in the southern Murray-Darling Basin (MDB).

A focus on private investment means universities can’t fulfil their public role

Margaret Thornton (Australian National University) writes in The Conversation that the decline in government investment in higher education and the ever-increasing reliance on fees and other sources of income has made universities more like private for-profit corporations.

As institutions of higher learning that receive government funding, universities are obligated to fulfil a public role.

The slide of academic standards in Australia

Gigi Foster (University of NSW) writes in The Conversation that in truly world-class universities, the bureaucracy plays second fiddle to the academics who produce the service that the university sells. By contrast, in many universities in Australia, arguably the tail is wagging the dog. This reinforces a focus on bureaucracy and revenue, rather than academic standards. No intervention will provide an overnight fix, but there are some remedies to contemplate.

A national affordable housing strategy: necessary and attainable

Carolyn Whitzman (University of Melbourne) writes in The Conversation that a national housing strategy could make cities more liveable, stimulate the property and construction sector, and reduce healthcare costs.

The root of Sydney and Melbourne’s housing crisis: we’re building the wrong thing

Bob Birrell (Monash University) and David McClosky (The Australian Population Research Institute), writing in The Conversation, analyse housing demand and supply. Their research confirms that Australia is building the wrong types of housing to satisfy household formation. This mismatch is likely to make housing affordability in Sydney and Melbourne even worse than it is now, while the construction of too many smaller inner city units present price dangers for investors in that market segment, particularly in Melbourne.

Australia’s plantation boom has gone bust, so let’s make them carbon farms

Jason Alexandra (Policy Partners and Charles Darwin University) argues that the boom and bust cycle for Australian plantations', with its focus on using fast money for fast-growing eucalypts, mostly for pulpwood, has obscured other important opportunities.

What ‘fair’ superannuation would look like

Rodney Maddock (Monash University) writes in The Conversation that many of the perceived problems with concessional superannuation taxation arrangements would be resolved by removing the ability and requirement to make contributions from before-tax income. Governments compel us to do lots of things without any incentive payments, and combining compulsion and concessions in the treatment of superannuation unnecessarily complicates the system and leads to unfairness.

The case for removing dividend imputation is not substantiated by evidence

Kevin Davis (Australian Centre for Financial Studies) comments in The Conversation on the lack of evidence to substantiate the case for removing dividend imputation in Australia.

Where to now on university reform?

Andrew Gunn (Australia and New Zealand School of Government) surveys the current state of higher education policy in The Conversation and points to four key things the new minister should do.

Australia's treatment of refugees is a profound injustice

Julian Burnside (Adjunct Professor, Australian Catholic University ) surveys Australia's policies toward refugees in The Conversation. This article is based on his delivery of the 2015 Hamer oration. It should be a very sobering read. If you don't really understand Australia's refugee policy, you should read this article. If you think you do understand, you will naturally want to read this article. Australia is now judged overseas by its behaviour as cruel and selfish.

Australia’s VET system needs fundamental change

Damian Oliver and Serena Yu (University of Technology Sydney) write in The Conversation that maintaining community confidence in the value of VET qualifications is essential for a functioning labour market, but the system is in need of fundamental reform.

Unfinished financial services reforms face the new Treasurer

Writing in The Conversation, Amy Auster (Australian Centre for Financial Studies) says that when Australia’s new treasurer, Scott Morrison, walks into the office today, a stack of unfinished business awaits.

Key policy challenges facing new Ministers in the Turnbull Cabinet

Writing in The Conversation, a panel of leading academics outlines the key policy challenges facing new Ministers in the Turnbull Cabinet.

Realising the Benefits of Smart Meters

A new report from the Victorian Auditor-General's Office finds that Victoria's electricity consumers will have paid an estimated $2.2 billion for metering services, including the rollout and connection of smart meters. In contrast, while a few benefits have accrued to consumers, benefits realisation is behind schedule and most benefits are yet to be realised.

Transferring water policy to the agriculture minister could trigger a logjam of bureaucracy

Part of the compact Malcolm Turnbull entered into to become Prime Minister included the concession to the National Party for portfolio responsibility for water policy in the Murray-Darling Basin to be transferred to the Agriculture Minister. James Horne (ANU) writing in The Conversation provides an update on progress in implementing the water reforms and the possible bureaucratic implications.

Two years in, even supporters despair of the Abbott government

Dennis Altman (La Trobe University), writing in The Conversation, assesses the first two years of the Abbott Government. So far, Abbott has failed to position himself as anything more than an opposition leader who has been given power and is unsure what to do with it. While the Government's weaknesses could turn out to be fatal, they are also clearly apparent and could therefore be addressed if there was a capability within the Government to do something about them. After all, even the Hawke and Howard Governments looked somewhat feeble in their first terms.

What is Australia's strategy for the Syrian military intervention?

Denis Dragovic (University of Melbourne) writes in The Conversation that military power alone cannot address the political and ideological motivations driving IS’s successes. Nearly five years of war has effectively redrawn Syria's borders, pushing people to move to what have become self-governed regions. We can look to the experience of the multi-ethnic Bosnia and Herzegovina to see how a previously integrated and heterogeneous society became segregated through conflict, and yet managed to establish a tenuous but peaceful co-existence by establishing autonomous regions. Australia must additionally commit non-military resources, diplomats, stabilisation and reconstruction specialists as well as financing. It must have a realistic view of the end goal and start planning to stabilise and rebuild any territory taken from IS.

Data indicates the recession is effectively here; it’s what policy makers do next that counts

Fabrizio Carmignani (Griffith University) writes in The Conversation that, while not being technically in a recession, Australia today shows most of the symptoms of recession. And without strong growth in state government spending, Australia would have probably experienced its first quarter of negative growth in 2015Q2.

A political myth that Australia takes more refugees than any other country

Mary Anne Kenny (Murdoch University) writes in The Conversation that it is incorrect to claim that Australia takes more refugees than any other country. In order to substantiate a "world best" boast, one has to torture the data to exclude the 99% of refugees who are not resettled by the UNHCR and also calculate on a per capita basis.

Distinct absence of strategy in Middle East actions

Michelle Grattan writes in The Conversation about the nexus between refugee, foreign and defence policy. She highlights the lack of accountability for Australia's offshore detention centres and an absence of strategy in Australia's intervention in the Middle East.

Keating, reform and the difficult notion of ‘political capital’

Writing in The Conversation, Natalie Mast (University of WA) and Nicholas Barry (La Trobe University) provide a nice explanation of political capital (the electorate’s level of “trust” in a politician or political party), how this trust can be used to instigate significant legislative reform, and a brief history of its use since Paul Keating's Government.

Should the federal government take over vocational training?

Peter Noonan (Victoria University) argues in The Conversation that there is little to be gained in just transferring VET funding to the Commonwealth under current policy settings. New policies are required so that VET and higher education work more effectively together, and to make sure that VET most effectively contributes to the Commonwealth’s economic and labour market objectives.

The NBN: why it’s slow, expensive and obsolete

Rod Tucker (University of Melbourne) explains why the Government's fibre-to-the-node NBN will be so slow that it is obsolete by the time it’s in place, it will cost about the same as Labor’s fibre-to-the-premises NBN, and it won’t arrive on our doorsteps much sooner.

What’s really at stake if the China FTA falls through

This is an insightful analysis from Peter Dixon and Maureen Rimmer (University of Victoria) from The Conversation, explaining that using the Government's own analysis the free trade agreement with China is expected to produce very modest economic benefits for Australia, and will likely only be noticeable in a few agricultural and downstream industries. Readers might also be interested in Peter Martin's analysis in The Sydney Morning Herald on how the apparent chasm between the Government and Opposition over labour provision might be resolved with a minor legislative amendment.

Things to remember when you hear politicians take credit for ‘job creation’

Ben Phillips (University of Canberra) provides a nice little summary in The Conversation of the labour force statistics and why it is disingenuous for the Government to claim credit for "jobs creation" in any given month or, conversely, for the Opposition to blame the Government for increases in unemployment in any given month.

Australia’s banks are safe, so deposit levy is looking like a revenue grab

Andrew Schmulow (University of Melbourne) and Pat McConnell (Macquarie University) write in The Conversation that deposit accounts are already appropriately protected by regulation and the capital adequacy of Australia's banks, so the Government's Financial Stability Fund has little meaningful role in banking stability and can therefore only be viewed as a tax on banks (which is likely to be passed on to depositors).

Simplistic notions of tax reform are flawed

Graham White (University of Sydney) writes in The Conversation that the Treasurer's call for tax cuts to fuel growth is a flawed argument. While income tax reform may well be a noble policy objective, the Treasurer's simplistic notion of tax cuts, and how to fund them, reveals more about his conservative dogma than does it boost his reform credentials.

Is Australia really over-reliant on income taxes?

Writing in The Conversation, Ian McAuley (University of Canberra) challenges the Treasurer's opinion that Australia is over-reliant on income tax. While the author's analysis and key points are generally sound, and the Treasurer's analysis is shown to be too simplistic, readers should also be aware that Australia does have a unique private superannuation based retirement-incomes policy whereas most other countries fund a public system through income taxes (but the Treasurer doesn't use this point to reinforce his argument) - this is just one example of why international comparisons of taxation are fraught.

Turnbull’s plan to speed up the delivery of Australia’s broadband network

Writing in The Conversation, Michael de Percy (Senior Lecturer in Political Science at University of Canberra) takes stock of Australia's progress in rolling out a modern broadband network, and locates Australia's performance in the context of the experiences of other OECD countries. He concludes that government control of the market has been stifling the industry. In particular, the contrast is stark with the mobile broadband market (where governments haven't meddled) - Australia is a world leader in mobile broadband and yet its broadband network is lagging well behind the leaders.

Spot the difference: Labor vs the Coalition on asylum seekers

Writing in The Conversation, Emily Darling and Sara Davies (Queensland University of Technology) explain the few areas of difference between the Coalition and Opposition policies on asylum seekers.

Refugee fact sheets from the UNSW Kaldor Centre for International Refugee Law

The University of NSW Kaldor Centre for Internaltional Refugee Law has published some excellent fact sheets on its website, including Debunking Myths and Turning Back Boats. A summary of the fact sheets is provided here.

Reforming federalism in Australia

Cheryl Saunders (Laureate Professor, Melbourne Law School at University of Melbourne) writes in The Conversation that the Australian Constitution sets up the framework for federal democracy surprisingly well, at the level of principle. But when governments pool their authority, horizontally or vertically, as in federations they sometimes need to do, the additional challenge of federal democracy is to find ways of ensuring that co-operation achieves its goals without eroding democratic principle and practice.

GST reform

John Freebairn (Professor of Economics, University of Melbourne), writing in The Conversation, considers what an equitable GST reform package should look like.

Lessons from Australia's experiment with carbon pricing

Hugh Saddler (Australian National University), writing in The Conversation, analyses detailed National Electricity Market (NEM) operational data from the Australian Energy Market Operator and finds that emissions and emissions intensity, which were increasing until shortly before June 2012, fell continuously for most of the two years to June 2014 (during which carbon pricing was in place).

How the Greek crisis unfolded

The economics team at NAB has put together a great slide pack explaining the evolution of the Greek debt crisis (link). My view is that the ultimate role of Governments is to improve the well-being of the people. However, the action of Euro-zone Governments in the Greek crisis has been the complete antithesis of this, highlighting the political immaturity of the Euro-zone experiment. And despite all of the pain inflicted on Greece, their position is worse and very unlikely to recover. Looking forward, Greece's only options would seem to be withdraw from the Euro-zone or wait for a miracle.

A Greek tragedy—The failure of European political economy under crisis

Four excellent articles in The Conversation on the absurd outcome emerging in the European debt crisis. The articles neatly tie together most of the different aspects of eurozone policy and the Greek debt crisis.

• How the hard-line approach taken by the IMF and Germany, against the pluck shown by Greece not to be bullied into oblivion (and, in so doing, courting economic collapse?), is explained by game theory is the subject of an article by Partha Gangopadhyay (University of Western Sydney).

• Barry Eichengreen (University of California, Berkeley) reviews his original prediction that an exit from the eurozone would never occur, and why that turned out to be incorrect—albeit, in an extreme situation characterised by political incompetence and perhaps even a disregard for economic sensibility. 

• André Broome (University of Warwick) explains why the IMF has become the enforcer of controversial structural reforms to a country experiencing severe economic distress, the social consequences of which have been disastrous over the last seven years.

• Wesley Widmaier (Griffith University) explains that the early European ideal was not about free trade or convertible currencies—it was about enhancing the collective welfare as a means to political union. However, the economic dog nevertheless came to wag the collective welfare tail, leading to a shift toward more free market, hard money views.The result would see European economic institutions evolve to such an extent that they place financial rectitude and monetary stability ahead of growth.

There is probably one thread missing in these explanations, and that is the role of fiscal policy—but the role of fiscal policy in the eurozone is a vexed issue in any case. I've added a few editorial notes on this issue, but the topic could do with a much more extensive explanation.

Boats secrecy leads to bad policy without democratic accountability

Alex Reilly (Director of the Public Law and Policy Research Unit, University of Adelaide) writes in The Conversation that there is confusion about the role of government, and the role of information in holding the government to account. The agencies of the bureaucracy are a central part of government. They carry out the will of the executive and as such need to be open to the same scrutiny as ministers themselves.

Why pensioners are cruising their way around budget changes

David Ingles and Miranda Stewart (both from the Crawford School of Public Policy at ANU) write in The Conversation that anecdotal evidence of pensioners significantly changing their lifestyle behaviour is a rational response to the recent Budget changes to the income and assets tests for the part pension. In contrast to the Budget changes, the Henry Tax Review and the Shepherd National Committee of Audit both recommended that the separate age pension asset test should be replaced by a comprehensive means test.

FactCheck: Is BHP Billiton Australia’s largest taxpayer, averaging $8-10b in tax a year?

Finally—an independent analysis, setting the record straight on corporate taxes paid. Roman Lanis and Ross McClure (both of UTS and reviewed by Rick Krever from Monash University) write in The Conversation that the claims of BHP Billiton in respect of its taxes paid in Australia are somewhat true—it is Australia's largest taxpayer; it pays an average of around $6 billion annually in corporate tax, but it has exceeded $8 billion in 2012 and 2013 (and it pays$8-10 billion only if royalties and rent taxes are counted as taxation); its effective tax rate was 45% in 2009 but is more usually in the range of 25-35% (the statutory rate is 30%).

How will a 40% cut in Australian aid affect Indonesia?

Don K. Marut (Lecturer in International Relations at Bina Nusantara University) writes in The Conversation that a huge cut in Australian development assistance to Indonesia will not be a big issue for most ministries, since aid accounts for a small proportion of the budget and the funds are mostly only for expanding the reach of the government projects.

• Indonesia limits aid to be no more than 3% of the national annual budget. This is to ensure that Indonesia’s development does not depend on foreign aid and, most importantly, that the country’s development policies are not dictated by foreign donors. 
• Indeed, Australian aid cuts will affect two main actors: the companies (mainly from Australia) that implement the projects in Indonesia; and the consultants who have long been acting as “aid rent seekers” in Indonesia. Both actors in fact significantly reduce the flow of aid funds to the beneficiaries.

Australian clemency appeals to Indonesia hampered by hypocrisy

Amy Maguire (Lecturer in International Law at University of Newcastle) writes in The Conversation that Australia’s contrasting approaches to capital punishment and the treatment of asylum seekers raise questions about Australia's commitment to human rights and the international body of law that exists to protect these.

Inequality arises from submitting to rent-seeking, more so than unequal exposure to economic progress

Writing in The Conversation, Gigi Foster (Associate Professor, UNSW Australian Business School) and Paul Frijters (Economics Professor, University of Queensland) argue that political science may be better than economics at explaining rising income inequality.

Treasury tax paper ignores virtually every new idea in tax policy since the 1970s

John Quiggin writes (The Guardian, 31 March 2015) that the worthwhile ideas in Re:think on tax are right out of the 1975 Asprey report on taxation reform.

High youth unemployment can’t be blamed on wages

Raja Junankar (Honorary Professor at the University of NSW) has written an excellent analysis of youth unemployment. He demonstrates that there is no evidence to support the view that youth unemployment is caused by high wages or by high unemployment benefits―in fact, inadequate aggregate demand is the principal cause. 

Consequently, the policy of the Abbott government to restrict unemployment benefits to young people (under 30 years of age) for the first six months of unemployment would have serious consequences for the young; however, it doesn’t address the root cause and therefore is unlikely to achieve its objective of reducing youth unemployment. This article was originally published in The Conversation on 16 April 2015.

Explaining the GST distribution method

John Freebairn (Professor of Economics at the University of Melbourne) has written a useful short note on how the GST allocation process works and the context for WA’s small share. This article was originally published in The Conversation on 17 April 2015.

The redrawn map of the Middle East is fraying at the borders

Yaroslav Trofimov (The Wall Street Journal, April 16, 2015) has written a fascinating summary of the way in which the borders of the Middle East were redrawn with the collapse of the Ottoman Empire at the end of the First World War, with implications for the modern day political conflict in the region.

Commonwealth inconsistencies in respecting State sovereignty

Alan Fenna (Professor of Politics at Curtin University) notes that the latest bout of federal interference from Commonwealth Ministers in the GST distribution debate is tantamount to bullying WA to accept the federal government’s push for privatisation of state assets―and runs counter to the Commonwealth Government’s stated policy position on respecting the sovereignty of the States. This article was originally published in The Conversation on 14 April 2015.

A more balanced critique of taxation concessions

Robert Carling (Centre of Independent Studies and formerly a Deputy Secretary in NSW Treasury) has written a very balanced critique of the purpose of taxation concessions, Right or rort? Dissecting Australia’s tax concessions, noting that many of these are actually significant structural features of the tax system which improve the effect of taxes on the efficient allocation of resources in the economy.

Extending dividend benefits to foreign investors may address competition concerns

This article by John Taylor (Professor, School of Taxation and Business Law at UNSW) is one of the more insightful considerations given to the issue of Australia's company tax. It was originally published in The Conversation.

Broader base, not a higher rate the answer for GST reform

This article by Dale Boccabella and Kathrin Bain (both from the School of Taxation and Business Law at UNSW) is on the options for GST reform (originally published in The Conversation).

The take-away message is that the first priority for reform should be to widen the GST and that this (rather than a rate increase) would be consistent with the broad thrust of tax reform over the last few decades.

The Commonwealth can change the GST without the States

This is a concise and clear article by Dale Boccabella and Kathrin Bain (both from the School of Taxation and Business Law at UNSW) on the legal effects of the GST lock-in mechanism (originally published in The Conversation). It explains why the "requirement" for the Commonwealth to gain the agreement of all the States prior to amending the GST legislation is not legally binding. Rather it is a "soft law" which only guides the behaviour of the Executive.

Higher education changes: the case in favour

A few weeks ago I republished an excellent article on the Government's poorly conceived and executed higher education "reforms" from Stephen Parker. His was a cogent and spirited attack on "ideology in search of a problem". The justifications of the reforms by the government amount to little more than confused rhetoric, attempting to "spin" away the mean-spirited dogma.

John Quiggin has also provided a spirited and cogent attack on the "reforms".

In contrast, Ian Young (Vice Chancellor at ANU) attempted to fill the intellectual void with a flawed attempt in support of the reforms in front of the National Press Club a month or so ago.

Now Glyn Davis (Vice Chancellor at Melbourne University) has made an attempt to justify the elite universities' support for the reforms - it seems it is all simply a desperate attempt to shore up funding in the face of the continuing erosion of Commonwealth funding. Well, at least he's honest! Nevertheless, he makes some useful points.

Expanding the GST would hit the ‘middle’ and women the hardest

Patricia Apps is a professor of Public Economics at the University of Sydney, and one of Australia's best tax policy analysts. This article on the redistributive effects of the GST (originally published in The Conversation) highlights the negative consequences for tax incidence and economic participation from broadening the GST.

While I don't disagree with her analysis, I have a relatively minor quibble about her policy conclusion—broadening the GST base (and not increasing the rate) to improve the efficiency of the tax is worth doing for its own sake. However, we need to acknowledge Professor Apps' analysis and accompany GST broadening with reforms to the income tax and transfers system which, not only address the redistributive problems of broadening the GST, but also improve the progressivity in the tax and transfer system and remove the distortionary effects of that system on workforce participation.

What Professor Apps' article does highlight, is how poor is the quality of taxation analysis and debate in this country. To the extent that she shines a light on simplistic (even sloganistic) notions of tax reform, her article is commended for your reading pleasure.