Comments on Tony Makin "Beware politics of envy when considering ways to equalise incomes", 19/06/2012, http://www.theaustralian.com.au/national-affairs/opinion/beware-politics-of-envy-when-considering-ways-to-equalise-incomes/story-e6frgd0x-1226399149922
Assume Makin's argument that income redistribution to younger people is inter-generational unfair, maybe there should be income loans that can be repaid in the future when their income exceeds a set level, similar to the HECS in nature, to younger people in need.
Showing posts with label wellfare. Show all posts
Showing posts with label wellfare. Show all posts
2012-06-19
2011-10-24
China needs a new national culture
Comments on Yao Yang “From production-oriented to welfare-oriented government in China”, 24/10/2011, http://www.eastasiaforum.org/2011/10/23/from-production-oriented-to-welfare-oriented-government-in-china/
Clearly there are some who would feel as victims of increasing inequality, a slower growth may generate its own problems.
This issue will be especially important when the Chinese society has increasingly lost historical and cultural heritages and in need of seeking a new national culture.
While it may be ideal to have a good social welfare system, China cannot afford moving away from high economic growth any time soon.
There will be a stage for China to move from the current state of low, unequal and incomplete of welfare to a state of comparable social welfare to most other countries, but it relies heavily on its high economic growth to address many of its urgent tasks.
There will be a stage for China to move from the current state of low, unequal and incomplete of welfare to a state of comparable social welfare to most other countries, but it relies heavily on its high economic growth to address many of its urgent tasks.
Clearly there are some who would feel as victims of increasing inequality, a slower growth may generate its own problems.
If a tax reform in Australia would require government revenue available to compensate the losers, China's high economic growth has a similar role to address many social problems. Without adequate growth prematurely before its income becomes largely comparable to middle to high income countries, the Chinese government would face the issue of the legitimacy of its one party rule.
This issue will be especially important when the Chinese society has increasingly lost historical and cultural heritages and in need of seeking a new national culture.
The Chinese government needs to lead in this endeavour, otherwise people would move ahead of it.
2011-05-24
Incentives alone not enough to solve the problems
Comments on Cassandra Wilkinson “Mollycoddling jobless is not compassionate”, 24/05/2011, http://www.theaustralian.com.au/national-affairs/commentary/mollycoddling-jobless-is-not-compassionate/story-e6frgd0x-1226061416518
While incentives are important themselves, they are not enough.
The government, society, the employers and the unemployed need to tackle this holistically.
The Australia's employment system can be very strange in some respects. For example, many employers require employment experience even for the most basic labour work.
Maybe that reflects some inherent deficiencies in the work relations system that may prevent flexibility because of some explicit or implicit/hidden costs in hiring and firing.
It has been reported over and over again that people work to work but just could not be accepted by any employers. Some are in perfect working age.
So, simply taking about incentives will not solve the problem. The government must look at the issues from those who are unemployed or on welfares and then design policies/strategies, and also put in place the real assistance available to those who need it or in need of it. Work in partnership with them.
PS: If people who want to find a job very actively can't get one, it is no wonder many on welfare can't get employment, or get off from the welfare system.
2011-05-17
Taxes, welfare and the middle-class
Comments on Gerard Henderson “Middle-class welfare tag insults the noble art of raising children”, 17/05/2011, http://www.smh.com.au/opinion/politics/middleclass-welfare-tag-insults-the-noble-art-of-raising-children-20110516-1eps8.html
There are excellent and pointed points in the article.
The quote of tax relief is worth noting.
Although unconventional, people should also realise that people who are middle class but on a bit higher income also pay more taxes, not just in terms of per person or per dollar, but proportionately more per dollar of income. That is the nature of progressive tax, as compared to a flat tax rate regime.
On per person basis, higher income people pay much more taxes than they could receive back from government services.
That is an important feature of the modern tax system to note.
There are excellent and pointed points in the article.
The quote of tax relief is worth noting.
Although unconventional, people should also realise that people who are middle class but on a bit higher income also pay more taxes, not just in terms of per person or per dollar, but proportionately more per dollar of income. That is the nature of progressive tax, as compared to a flat tax rate regime.
On per person basis, higher income people pay much more taxes than they could receive back from government services.
That is an important feature of the modern tax system to note.
2011-05-04
A better aid for battling families
Comments on Matthew Franklin “Battling parents to get extra cash”, 4/05/2011, http://www.theaustralian.com.au/national-affairs/battling-parents-to-get-extra-cash/story-fn59niix-1226049430654
The tax and benefit/welfare systems are a mess and any new measures will undoubtedly make them more complex, unyielding and worse.
Why doesn't the government create a study loan category available for high school and college students, similar to the HECS style loan to university students but is mainly for helping with living expenses?
You can even have conditions on the loans, such as a means test.
Of course, it is optional and no people would be forced to use it.
To make it even better, the loan debt for students who are from low socio-economic status family background and have achieved very good results (with pre-defined criteria) could be wholly or partly be deemed as scholarships and the obligation of pay back the loans be waived. That will provide more incentives for better learning and contribute to better future skills.
To be more accountable to Australian taxpayers, any person with such an Australian government loan should have the obligation to pay even if they migrate to other countries, as long as their income is above the threshold.
The tax and benefit/welfare systems are a mess and any new measures will undoubtedly make them more complex, unyielding and worse.
Why doesn't the government create a study loan category available for high school and college students, similar to the HECS style loan to university students but is mainly for helping with living expenses?
You can even have conditions on the loans, such as a means test.
Of course, it is optional and no people would be forced to use it.
To make it even better, the loan debt for students who are from low socio-economic status family background and have achieved very good results (with pre-defined criteria) could be wholly or partly be deemed as scholarships and the obligation of pay back the loans be waived. That will provide more incentives for better learning and contribute to better future skills.
To be more accountable to Australian taxpayers, any person with such an Australian government loan should have the obligation to pay even if they migrate to other countries, as long as their income is above the threshold.
2010-03-17
Macklin's welfare change lacks enough flexibility
Comments on Paul Kelly “Macklin's welfare fight is only the beginning”, 17/03/2010, http://www.theaustralian.com.au/news/opinion/macklins-welfare-fight-is-only-the-beginning/story-e6frg6zo-1225841562048
While Paul Kelly seems a strong supporter for this policy change, he nevertheless has taken the easy road of siding with any change by the government when facing a difficult issue.
Yes, there is a need for change, but it does not mean any change will be better or equally good.
Unfortunately in this regard, Paul does not analyse the issue critically enough.
A more sensible approach is giving the government the mandate to use that on any welfare it sees fit, but without any predetermined and possibly a compulsory percentage without taking account the real situations or with little regard to the real need in different situations in the complex world.
The main shortcoming of government income management in the name of changing behaviour is that it can be very disempowering for those under management. For some it may produce the opposite effect to the legislation’s intention, that is, rather than change their behaviour to the better it may actually worsen theirs.
So there is a clear need to restrict its use to absolute minimum and target well.
While Paul Kelly seems a strong supporter for this policy change, he nevertheless has taken the easy road of siding with any change by the government when facing a difficult issue.
Yes, there is a need for change, but it does not mean any change will be better or equally good.
Unfortunately in this regard, Paul does not analyse the issue critically enough.
A more sensible approach is giving the government the mandate to use that on any welfare it sees fit, but without any predetermined and possibly a compulsory percentage without taking account the real situations or with little regard to the real need in different situations in the complex world.
The main shortcoming of government income management in the name of changing behaviour is that it can be very disempowering for those under management. For some it may produce the opposite effect to the legislation’s intention, that is, rather than change their behaviour to the better it may actually worsen theirs.
So there is a clear need to restrict its use to absolute minimum and target well.
2009-09-27
Krugman's free lunch in cap and trade?
Comments on Paul Krugman “Pigou, Glenn Beck, and the false case against cap-and-trade”, 25/09/2009, http://krugman.blogs.nytimes.com/2009/09/25/pigou-glenn-beck-and-the-false-case-against-cap-and-trade/
While Krugman is arguing that others have either got the economics wrong or were deliberately misleading the readers, I also find that his use of economics may have some problems. For example, he says:
"And the burden on households from cap and trade depends on what’s done with the rents. In the original Obama plan, the rents would be used to pay for middle-class tax cuts; in Waxman-Markey, many of the permits are initially granted to utilities — but since these utilities’ profits are regulated, many of the rents would end up being passed on to consumers through lower prices."
Krugman's argument of lower prices to be passed on to consumers is unlikely to be true. The price is unlikely to be any lower than it is now due the permits granted to utilities. To the most it may not be higher, if and only if utilities got all the permits they need as business as usual. If they get less permits than they need their costs will increase and as a result their price will rise.
It is only natural that when some costs (as shown as the negative externality Krugman talks about) that are not accounted for will be accounted for under the cap and trade, there will be a fall in the welfare of the nation and the world. Otherwise there would be free lunch available.
While Krugman somehow created an illusion that the price of utilities will be lower, whether it was attempting to mislead or something else is unclear.
While Krugman is arguing that others have either got the economics wrong or were deliberately misleading the readers, I also find that his use of economics may have some problems. For example, he says:
"And the burden on households from cap and trade depends on what’s done with the rents. In the original Obama plan, the rents would be used to pay for middle-class tax cuts; in Waxman-Markey, many of the permits are initially granted to utilities — but since these utilities’ profits are regulated, many of the rents would end up being passed on to consumers through lower prices."
Krugman's argument of lower prices to be passed on to consumers is unlikely to be true. The price is unlikely to be any lower than it is now due the permits granted to utilities. To the most it may not be higher, if and only if utilities got all the permits they need as business as usual. If they get less permits than they need their costs will increase and as a result their price will rise.
It is only natural that when some costs (as shown as the negative externality Krugman talks about) that are not accounted for will be accounted for under the cap and trade, there will be a fall in the welfare of the nation and the world. Otherwise there would be free lunch available.
While Krugman somehow created an illusion that the price of utilities will be lower, whether it was attempting to mislead or something else is unclear.
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