Equality, politics and economics
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Sustaining us all in retirement | The Australia Institute

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Super tax concessions, most of which are being claimed by people able to afford early retirements if they choose, will soon cost more than the age pension.

The age pension currently costs $39 billion and superannuation tax concessions will cost the budget around $35 billion in 2013-14. These concessions are projected to rise to $50.7 billion in 2016-17, an increase of around 12 per cent per annum. By this time superannuation tax concessions will be the single largest area of government expenditure. The overwhelming majority of this assistance flows to high income earners. Low income earners receive virtually no benefit. The combined cost of these two policies will be $74 billion in 2014 alone. With an ageing population the dual pension/superannuation system will become increasingly expensive. The government’s own projections are that the cost of super tax concessions as a share of GDP will exceed that of the age pension by 2016-17.

This paper presents an alternative model that could produce a fairer, more adequate and more sustainable retirement system. It proposes that we abolish tax concessions for superannuation and create a universal (non-means-tested) age pension. 

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Copying UK's austerity cuts sets us on a road to ruin

Copying UK's austerity cuts sets us on a road to ruin | Equality, politics and economics | Scoop.it
The theory behind economic austerity is elegant - the only catch is: it doesn't work.
MacJanet's insight:

Andrew Leigh says "If you care about reducing the debt to GDP ratio - as I do - then you need to worry not only about paying down debt, but also about increasing GDP." and quotes prominent economists advocating stimulus rather than austerity - Blanchard, Krugman, Stiglitz... but UK PM Cameron persists with austerity, as do Coalition state governments in Australia, and Abbott proposes to do, whilst the Labor governments headed by Gillard and Rudd have also repeated the mantra of "balanced budgets". Why are they all so defiant of the recommendations for achieving GDP growth through stimulus and job creation? Could it be that actually a longer term increase in the rate of profit is better assured by persistent unemployment and working class insecurity, so that employers have even more of an upper hand against labour and espececially trade unions. The blather about public debt looks like a convenient cover for anti-labour economic policies, and if increased power for employers comes from higher rates of unemployment, then the lower rate of GDP growth and failure of some businesses, especially small businesses, is a price that capital is prepared to pay. 


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Paul Krugman on the political salience of inequality

Paul Krugman on the political salience of inequality | Equality, politics and economics | Scoop.it
…it is notable that in a time of deeply depressed labor markets, our biggest thing is long-run inequality. Or closer to home, I do of course track how my columns do on the most-emailed list; and there's no question that ...
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How much revenue would a 75% tax rate generate? > Check the facts

How much revenue would a 75% tax rate generate? > Check the facts | Equality, politics and economics | Scoop.it
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"The latest figures from the Australian Taxation Office (ATO) are for the financial year 2010-11. In that year the top one per cent of taxpayers (94,160 people) earned $59 billion in round numbers. If that income was taxed at an average 75 per cent the tax paid would be $44.4 billion which compares with the $23.5 billion actually paid and that would give an increase of $20.9 billion in tax revenue."

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