The Prime Minister Kevin Rudd is planning to destroy billions of “seed corn” called the super funds savings of Australians.
Tuesday, January 29, 2008
“Super ideal to provide funds for infrastructure
In a time of scarce resources and market volatility public private partnerships are the best way to fund major projects” The Australian, by Adele Fergusen.”
Reading the ‘mainstream’ media’s economic commentariat is depressing. They bury serious matters under layers of mud. If it were not for Brookesnews, in Australia there would be no trustworthy journal of economic analysis and explanation. However, the subject is what Rudd and Swann are proposing to do. Adele and “The Australian” are oblivious to not only economic theory but also to what the substance of the new Prime Minister’s and Treasurer’s plan is. It doesn’t require economics to work out the criminal force of the “plan”.
1. What Rudd and his Treasurer, Swann, are planning is raiding the (superannuation) savings of Australians to throw at what is nothing less than more government consumption, and that would be destruction of capital on a massive scale. Capital, inclusive of super funds, is hard taxes as it is. The ATO also acted during the past few years to extract more taxes out of super savings plans, by closing what it calls ‘loopholes’ in ‘tax law’.
2. If they can get away with it, it will be theft of the private property of millions of Australians on a massive scale. It is criminal what the Federal Cabinet is preparing to do. It does entail commission of major crimes against Australians. It is a ‘plan’, involving the recruitment of “businessmen”, to deliberately defraud Australians of their savings.
3. That to tie ‘enterprise’ in to execute the ‘plan’ is also fascist corporativism.
4. It will see many Australians impoverished in their old age, contrary to the reason for saving and increasing their “seed corn” through superannuation policies and similar funds.
Adele reported:
But as Mitch King, chief executive of infrastructure funds management outfit Lighthouse Infrastructure says, the Government’s plan is a welcome one.
“It is logical, necessary, politically courageous — if it is to be implemented balancing the various interest groups (state versus state, federal versus states, local government, private sector) and recognises the capital efficiency and role of the private sector,” he says.
But he says the main problem is the excessive timing. A year to create a list suggests this is not a real plan, according to King…
King suggests the following to make the idea a reality:
* Create the list quickly…
King believes it will require some gutsy calls, but the federal Government clearly has the mandate and can leave a legacy for future generations if it acts quickly. King is spot on.
King is not spot on. Moreover, “Lighthouse Infrastructure” super customers should be very worried. My advice to them is remove your savings and place them with firms that will not have a bar of the fraud Kevin Rudd proposed. Put your savings with firms that will fight tooth and nail any device Rudd, Swann, bureaucrats and their ‘advisers’ dream up to steal and destroy their hard earned and already hard taxed savings. King deserves to be chucked out of his well paid job and the firm to collapse. The collapse that swiftly follows customers removing their savings to firms that can be trusted to do their very best by customers and their savings.
A Mr. Zwi states:
says there are numerous implications that need to be carefully considered by the super funds and the governments
It sounds reassuring, but a man who can say the following, as Zwi does, has a handicap in fighting Rudd and his criminal scheme called economic ignorance:
But he warns that if essential infrastructure is in private hands, there is an incentive to maximise profits by raising the cost of usage more aggressively than would otherwise be the case if it was in government hands, because the funds are interested in returns, not worrying about sacrificing votes at the ballot box.
“There are many implications that have to be carefully thought through, because you could end up with a situation where the relevant government has to buy the asset back because it was run down,” he says.
There is a bright note in the article. Mr. David Bryant objects to the ‘plan’ for a good reason:
David Bryant, group executive of investments at Australian Unity, which has more than $6 billion in funds under management, says superannuation funds are required under law to invest for the sole purpose of providing adequate returns for retirement funds.
That is the only bright note.
Infrastructure Partnerships Australia national manager of public affairs Brendan Lyon says, with an infrastructure shortfall, the Government is prudent to seek to match retirement savings with urgent infrastructure projects in Australia.
“The lack of opportunities for superannuation investment has led to a situation where 30 per cent of retirement savings are being invested offshore at a time when Australia’s infrastructure shortfalls are becoming urgent,” he says.
Tony Shepherd, the chairman of Transfield Services, one of the biggest infrastructure companies in Australia, applauded the use of superannuation funds to bankroll infrastructure in Australia.
No, if Rudd wishes to engage in a spending spree, he has to do it through the revenue stream called taxation. The Hawke –Keating Government imposed the tax ‘petrol parity pricing’. They also imposed the ‘roads levy tax’ on petrol – to build roads. Never mind that road building is one of the major reasons (excuses) politicians and bureaucrats, each “tier of Govt.” have used to hit Australians with ever increasing taxes, Keating added another one on top. Instead of roads, those tax revenues have been thrown down the voracious throats of more grand socialist schemes. Now they want more!
The PAYE tax was introduced in the ealry 1940’s to pay for WWII. It was not imposed as an eternal tax. At the end of WWII, politicians and bureaucrats were loathe to get their hands off private property. They said, ‘we will retain the tax to pay every Australian a pension’. Today, those who might be considered fully entitled to that, ie. those who lived through the war era, have to meet capricious tests to receive a single cent. We are speaking of old-aged pensioners.
The politicians cannot fulfil the obligation to that generation, but they can make multi-billion promises to buy votes from the likes of Greenies, and ‘wannabe” university ‘stoodents’. The politicians and bureaucrats have abused the PAYE to impose a miasma of socialist schemes. They are at it again. (It is time to kill PAYE, a large number of taxes, and the myth “Government’ has some automatic, divine right to tax all and sundry into ‘poverty street’).
Local Councils, States’ Governments, and the Federal Government refuse to meet what was one of their original duties, in return for taxation, build things such as roads. Rudd’s solution to their malfeasance is: seize the savings of Australians and throw it down the black hole of more government consumption.
If Rudd wishes to throw money on consumables he has only four choices:
1. He cuts other areas of government consumption, and redirects the funds into what he might propose to indulge.
2. He raises taxes.
3. If the ‘budget surplus is real’, spend that on his grand schemes.
4. A combination of the above three options.
However, the reason why he is preparing a criminal conspiracy to steal and wipe out the the private property of many Australians is transparent.
The object of the scheme is clear; it is to avoid a voter backlash because of what the Cabinet is about to launch, a massive increase in government squander, and a hike in taxes to cover it. It is an attempt to conceal socialist planning and squander. By falsely calling it investment, and a legitimate direction of capital, Rudd and Swann are merely engaged in a preparatory propaganda campaign to blind voters to those facts.
The concealment plan is called ‘let’s siphon Australians’ savings accounts into our coffers and call it ‘investment’ . Savings are highly taxed as it is, including those held in super funds, but now along comes Rudd who will do a Swannee and loot the lot. They, as Adele related, have already taken steps to establish their crime syndicate.
What has been the response of Opposition Leader Nelson, and Shadow Treasurer Turnbull? Silence, not a peep, not a hint of attacking Rudd and Swann over the poposal. There is not a twitter from the self-styled “free market think tanks’ and the ‘right wing’ of the Liberal Party ( nor from the ‘wets’). They have had three days to attack Swann and Rudd.
All we have heard from Banana Republic Presidente aspirant, Turnbull is; ‘the time will come soon for the Republicanistos revolution’. Yes, right, and in the meantime a few Liberals will have lined Turnbull up against a wall and shot him. As for Nelson, during the Australia Day long weekend, he did a good imitation of ‘Red’ Ted Baillieu, a lot of squeaking about nothing much.
One might infer Colin and Mal see nothing wrong in a major criminal conspiracy, run with the co-operation of “insider traders” and “butt protectors” euphemistically called businessmen. Nothing wrong at all, with a massive transfer of wealth into the pockets of parasites. Indeed, one suspects they heartily approve of this plan to commit theft and fraud on a massive scale.
Mind, Turnbull, as the last Liberal Cabinet Minister for the Greenie Cult of Death, proposed his own plans for extracting the savings of modest Australians, and wiping them out. So, one infers he has no objection to the Rudd-Swann plan. Turnbull and Nelson have shown themselves besotted with the vainglorious pretensions of politicians, bureaucrats, and pseudo-businessmen (who see another get rich quick scheme in the offing, like the ethanol and windmill scams).
Even if what was proposed is not in fact criminal, the claim that raiding super funds to pay for government dictated consumption will somehow ensure future economic growth and prosperity is a kenyesian fallacy. Only capital (savings) and entrepreneurs yield economic growth. Rudd’s plan = the immiseration of Australians by acts of criminal conspiracy, fraud, and squander.
Below are a few corrective items from Brookesnews.
So-called ethics, wages and economic stupidity
. Businesses do not receive subsidies, people do; businesses do not pay taxes or wages, people do. It is the investments made by people in business enterprises that creates the resources that builds our taxpayer-funded infrastructure and, incidentally, finds employment for the likes of him.
It is these investments, taxed and curbed as they are by governments and unions, that fuels economic growth. For Longstaff’s absurd claim to be correct, all businesses would have to be tax consumers. That is to say they would have to receive more in taxes than they collectively pay.
His other silly claim that jobs and wealth are common goods to be enjoyed by everyone is just juvenile socialist dogma. This conjures up an absurd picture of a vast community pool of jobs and wealth to which everyone has an equal share, but the greedy ones manage to get more than their fair share.
He also obviously has no real idea of what a job is. Labour rents…
Bottlenecks and monetary policies: more economic fallacies that damage economies
Emerging bottlenecks tell us that monetary policy has distorted the pattern of production to the point where firms now find that either they do not have sufficient complementary factors to meet the demand for its product, in which case they must continue to bid against each other for the necessary factors, which also include circulating capital. This is always the case where investment has been driven by artificially low interest rates and the boom is allowed to continue until brought to an end by real factors. The point may even be reached where …
Keynesian nostrums still plague the US economy
Immigration, economic growth and jobs
Central banks panic as credit crunch looms
The root of the problem is not just a misunderstanding of how money actually functions but also an ignorance of even elementary capital theory. Once again, capital is heterogeneous and forms an incredibly complex structure with a time dimension. When the central bank pushes interest rates down below their market rate this encourages companies to expand their activities by borrowing at the low rates. This in turn distorts the capital structure….
Once this happens a recession becomes unavoidable, and Austrian capital theory explains why. Firms — particularly in manufacturing — find that a point is reached where capital goods, including circulating capital, become increasingly scarce along with certain types of labour. This leads to firms…
However, by using credit expansion the impression can be given that an economy has grown faster than it has saved. By this process businesses can direct resources away from consumption to investment, giving the impression that investment now exceeds savings. This is called inflation.
It should be noted that the apparent discrepancy between investment and savings is really a monetary illusion, the product of a monetary disturbance. In real terms investment still, as it must always do, equals savings, even if they are forced savings.
Davidson has made the absurd class-war accusation that Treasury ‘ideology’ held back savings by restraining growth because it put the “interests of rentiers (people who save) ahead of real entrepreneurs” who make real investments that create jobs. What he means by this Keynesian ideological claptrap is that the Treasury should be forced to lower interest rates to stimulate investment. But this is the very policy that gave us the 1980s boom followed by “the depression we had to have”. In other words, what Davidson called for was more inflation followed by another recession. (This is precisely what the Howard Government gave us. The irony here is
In Summary:
Capital is savings. Rudd plans to wipe out massive amounts of capital in criminal conspiracy with parasites pretending to be be entrepeneurs.
Contrary to Rudd’s claim, and others who say so, it won’t solve bottle-necks. They emerged because of inflation, the RBA’s destructive habit of credit expansion.
It is consumption, and not investment of capital.
It is theft of private property on a massive scale.
It involves the grand lie that central planning and socialist schemes are superior to private property, free markets and volitional undertakings, capital accumulation, and the work real entrepenuers do.
It rest on fallacious notions palmed of as true economic theory, particularly keynesianism.
A destructive and criminal plan, it will immiserate many Australians by “eating their seed-corn”; they will have nothing to harvest in their old age.
It only tells us what the real aims of the Rudd lead Cabinet are. Australians should be more than disturbed by what is revealed.