On Labor and class warfare

Martin Gordon writes: Re. “Labor’s tax reform sets the scene for a real class war”  (Wednesday)

When Bernard wrote this I had been reading a friend’s reflections (assertions) of an earlier, apparently golden, age of evidence based policy. I am sure the comrades won’t be troubled unnecessarily with the chronological inconvenient truths of previous Labor Party opposition to financial deregulation, higher fuel pricing to encourage conservation of this wasting resource and a host of other regressive or expensive policy positions held by them at various times. But I was reminded of good old fashioned divide and rule politics which is what the ALP is visiting again. Often it works, and has a historical pedigree as in the biblical reference the Peter (the payers/victims) are less numerous than the Paul’s (the alleged beneficaries of the apparent largesse).

Given there is $50B of tax concessions in superannuation annually, a tweak there would be much more useful and could actually make a serious difference to low income superannuation balances and the budget, (something the existing highly regressive system largely of Labor’s creation does not do at all, but which really delivers for high income earners). Similarly policy that favours or disfavours certain investments (eg residential housing) is economically unsound, even well respected economists such as Chris Richardson favour the CGT wind back but not the specific investment bar.

I am surprised that the Labor Party is moving on the dividend policy (and income tax and Medicare rates rises) that will stir up a lot of opposition (Rudd and Gillard did comparatively little tax change and were chastened by that they did). The dividend imputation one will arouse a lot of retiree and future retiree resistance. The supposed education and health spending and tax cuts will be harder to deliver (or meeting expectations). A large target strategy (as John Hewson found) comes with risks. Unlike 2016, I am sure Turnbull will run an aggressively negative campaign on ALP positions (that is not a mistake you make twice).

On Rex Tillerson

Meredith Williams writes: Re. “Tillerson is gone, and torture is in? A cheat sheet to Trump’s new appointments”  (Wednesday)

A week is a long time in politics, and much longer in the Trump Twitter-sphere, where hot-heads rule, staff change at high frequency and dissenters get the flick with alacrity. So well done Tillerson for surviving 14 months as US Secretary of State. I may not agree with your politics but I recognise sincerity and integrity in your stance.

Peter Fray

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