Sep 27, 2012

Testing the ‘bleeding obvious’ on prophecies of doom

How did dire predictions about government tax changes in 2008 pan out? We decided to check.

Bernard Keane — Politics editor

Bernard Keane

Politics editor

As another pre-emptive mining industry campaign fires up to warn the government off considering removing tax concessions to fund corporate tax cuts, it’s worth doing a reality check on the track record of industry in opposing government decisions.

It was a tax that was “one of the greatest assaults on the living standards of Western Australians I have ever seen in the history of Federation”, one Liberal senator Liberal senator said; one that demonstrated “all of the morality of carpetbaggers and burglars”. Another Liberal senator declared it would “have disastrous consequences for our sovereign risk profile”. “Our reputation has gone down the drain because of this. Every single large project boardroom is saying: ‘What is happening in Australia’?”

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9 thoughts on “Testing the ‘bleeding obvious’ on prophecies of doom

  1. Steve777

    Of course any new tax, any tax increase and any winding back of a tax concession is always decried by those affected as the greatest disaster in the history of the known universe (and probably the rest as well), impacting widows, orphans, fluffy kittens and especially impacting you. Very few ask the question of who pays and who gains. In fact, no one asks why corporations would allow the change to wreak such havoc when they could alleviate its effects by taking a modest reduction in profits. Everyone wants the Government to do stuff for them but no one, least of all Corporations and the wealthy, want to pay for it.

  2. AR

    The scope for massive national savings, removal of the fuel excise exemption for miners would be $4B minimum, would pay for a lot of hospitals, teachers and medical care. And that’s just for starters.
    Middle class welfare is obscene enough but the massive, not-so-hidden to anyone bothering to look, subsidies to various industries would cut/add 20% to government revenues without the electorate being affected.
    I’ve noted lately that the government is starting to do the things a Labor administration shoiuld do, were it true to its original purpose of levelling the disparity between capital/privilege and the real people who work their guts out for their children.
    Go Gillard, more! more! more!!!!

  3. John Bennetts

    AR, there is a quite reasonable argument against taxing the inputs of the exporters, eg taxes on diesel used in mining equipment, but you wouldn’t want to hear that, would you? Your mind is fixated on taxing anything that makes a profit and supporting anything that does not.

    A decision not to tax diesel used for these purposes is not a subsidy.

    Nuance. Balance. Lost concepts for some.

  4. izatso?

    CORPORATE WELFARE ! I say loudly. HIDDEN CONCEPTS FOR SOME ! I say louder …… Descisions made by the entitled few, at the cost of the increasingly angered many

  5. floorer

    all I’m getting on Crikey now is the sound of tumbleweeds tumblin……

  6. Denise

    I am finding the new look crikey painful. Bring back the old easy to use cover page now.

  7. Mike Flanagan

    I do agree it has become a pain. Technically it is slower and harder to navigate. It takes my laptop at least three times as long to enter the site than any of more than thirty sites I might visit over a day.
    It frequently gives me a 500 note of server inadeqaucy to react to the traffic.
    I suspecdt the influence and the proliferation of Tablets together with Facebook and Twittershpere are working, in the IT industry, against the users of desktops and laptops.
    The removal of the Enviroment section as an editorial descision I think supports my contention that there has been quite a change in editorial emphasis over the last months.
    Considering the changes weather and climate patterns are going to have on our individual and collective lifestyles, one would have thought Crikey, of all the available media, would try to meets its obligation to inform its subscribers and given the subject its’ relevant priority.

  8. oldskool

    I agree the new- look Crikey is awful, slow, crashy and what happenned to yesterdays subscriber edition?

    Anyway, the funny thing about the luxury care tax argument is that the threshold changed from $57,009 to $57,123!

  9. Mark Duffett

    Despite his pious fulminations on report whacking, Keane proves here that he can cherry-pick and mislead with the best of them. His first graph purports to demonstrate a lack of impact of condensate excise exemption removal on petroleum exploration in WA: “…the decision preceded a huge spike in investment in petroleum exploration in WA”.

    Did it not occur to him to check the primary driver for petroleum exploration – oil prices – over the same period? Such as the graph at

    It clearly indicates the exploration expenditure peak in late 2008 to have been led by a spike in oil prices six months earlier. But what’s more instructive is what happens after that. Since the GFC-induced crash in late ’08, oil prices have risen steadily. Yet exploration expenditure has continued to fall. I’m not saying this is necessarily all down to the exemption removal, but it’s certainly consistent with a significant impact from it and entirely contrary to Keane’s thesis.

    I’m not sure what’s worse – that Keane failed to check something as obvious as the oil price driver, or that he did, but left it out because it didn’t suit his story.

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