Mangled Thoughts

Tony Blair and Gordon Brown assumed if a carbon tax were not imposed on consumption, no great damage would ensue. They were gravely wrong; their victims had no choice but to endure the devestation because it was coerced - it was Govt. fiat.

They, also holding the mercantilist fallacy, assumed if the carbon tax were levied on energy producers, there would be little if any damage to exports. Foreign consumers would absorb the impact of the tax. That, consumer spending would still drive production, the Keynsian fallacy.

Who advised them? More lawyers, like themselves, for whom economic matters can be reduced to regulatory paper work? A British version of the CIS - and this wouldn’t surprise given the state of the Tory Party with its own Westminster version of Ted Baillieu and the ‘dancing blobbies’.

The energy companies’ capital being extinguished, marked by large cuts in supply of energy, the manufacturers have been forced to take large capital losses and with them sack large numbers of employees. This is one of the cases mentioned in an earlier item.

To this, the following suggestion reinforces how bad the CIS position is:

Terje (say tay-a) wrote:

John [Humprhreys]

Maybe if you offered to use the carbon tax revenue to reduce capital gains tax then the logic of tax reform might sink in. However I won’t be holding my breath.
Posted on 12-Mar-08 at 8:02 pm

To which I replied:

there’s a tinsy winsy obstacle…

There can be no reduction in capital gains tax when capital is being smashed due to the carbon tax.

Secondly, why should reduction of one capital tax be pinned to willingness to accept another, in this case one that is destructive on a massive scale?

The sheer number of capital taxes already in force in Australia is bad enough. To offer to cut one in exchange for a massive capital tax to wipe out coal based energy firms, and thence smash many other firms as a consequence, is truly Orwellian.