Posted by: graemebird | May 25, 2008

Increasing Retirment Incomes/ Treasury Nihilism And Lack Of Creativity/The Ongoing Importance Of The Mass-Sacking Of Taxeaters.

There’s a rumour going round that a lot of retirees are having to get by on about $270 per week as their base pension. This is an appalling disgrace, which diminishes us all, when you consider that hundreds of harmful, useless, or near-useless government agencies are still in existence and could be dissolved.

But there is a couple of catches here. Suppose if we dissolved very many government agencies and managed to pump retiree incomes up to minimum 400 per week (which would be almost civilized.) Well clearly that would be better than leaving these hateful government agencies in place and these poor old diggers in such squalor, financial stress and social isolation.

But consider what it might do to our willingness to fund our own retirement? And consider what it would do to the governments unfunded liabilities, being as the baby-boom generation is coming up to retirement. So that an act of basic decency (ie dissolving dozens of government agencies and the boosting of retiree incomes) could become an economy-crusher down the track.

So what is Treasury and Wayne Swan suppossed to do?

THEY CAN FIND A BIT OF CREATIVITY IS WHAT THEY CAN DO!!!!!!

There are many ways to handle this problem. This is the rest of the old peoples lives we are talking about. The taxeaters will pick themselves off the ground and get real jobs and within 5 years they will be F.I.N.E fine!!! But in 5 years a lot of these old diggers will be dead. And there will be no chance to keep faith with them then.

The idea is to handle things, as much as possible, by reducing the scope of governmental depredation.

Here are a few ideas for Treasury.

1. They could get rid of the 15% surcharge on salary sacrifice for superannuation contributions. Meaning that a lot more of the older baby-boomers will start providing for their own retirement in a more substantial way.

2. Starting from right away, they can raise the retirment age one day every two. Every two days that passes the age at which you qualify for old-age benefits would increase by one day.

3. They can increase the tax-free- threshold for people of retirement age to 100,000 AUD per year to try and keep a lot more retirement age people working.

4. They can open up an avalaunche of part-time jobs for older blokes. Because most older people are fine to work. Just not at the same level of productivity as a younger bloke and not 40 hours a week.

So to get businesses actually hunting down old people with job offers, they could allow business to DOUBLE-EXPENSE for tax purposes wages given to people of retirement age. Supposing you pay some old bloke to do two eight hour shifts at 12 dollars per hour every week. So every week instead of claiming his labour costs at 192 dollars, you get to reduce your taxable income by 384 dollars. Since the company tax rate is 30% you would have then gotten 16 hours of work out of the old bugger for only $76.80c. An effective cost to the business of only $4.80 per hour. So its cheap labour for the business and a reduction in business tax liabilities. Paid for by dissolving government agencies.

5. They could allow people to register their older relatives as dependents thereby lifting their own tax free threshold up sky-high. Of course this would be done in such a way as not to allow double-dipping.

6. They can get rid of taxes on interest earnings, increasing savings rates more generally, and the incomes of pensioners who have savings stashed away.

When all measures one-through-six are implemented, and the mass-sackings are in train, it would be fully responsible to boost minimum weekly retirement incomes up to $400 dollars. This would be fully responsible from a long-term budgetary point of view.

And though you might boost absolute minimum base pay up to 400 dollars… these measures are actually designed, so as to get a lot of retirees incomes up above 1000 dollars NET!!! per week…….

……AS ANY JUST TREASURY WOULD HAVE IT!!!

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Responses

  1. 1. They could get rid of the 15% surcharge on salary sacrifice for superannuation contributions. Meaning that a lot more of the older baby-boomers will start providing for their own retirement in a more substantial way.

    If they have no savings and they are on a pension, they will not buy in. Their taxes were meant to be a buy in of sorts for the pension, buying publicly owned utilities and the like in the day.

    SITE DEITY SEZ. WHAT ON EARTH ARE YOU TALKING ABOUT HERE MARK? I’M CHARTING A LONG-TERM COURSE FOR FUNANCIAL RESPONSIBILITY. PROMOTING THE NEXT GENERATION OF PEOPLE NOT TO BE RELIANT ON THE PENSION. WHAT YOU SAY HERE IS SIMPLY IRRELEVANT.

    2. Starting from right away, they can raise the retirment age one day every two. Every two days that passes the age at which you qualify for old-age benefits would increase by one day.

    So what if I am 49 and I’ve amassed a heap of super – you want me to work longer even though I’ve invested wisely?

    IF YOU’VE AMASSED A LOT OF SUPER YOU CAN DO WHAT YOU WANT. THE COMMENT IS NONSENSICAL.

    3. They can increase the tax-free- threshold for people of retirement age to 100,000 AUD per year to try and keep a lot more retirement age people working.

    Nothing wrong with that. I’d prefer to abolish income tax altogether.

    RIGHT. BUT THATS HARDLY A CRITICISM OF WHERE I’M COMING FROM.

    4. They can open up an avalaunche of part-time jobs for older blokes. Because most older people are fine to work. Just not at the same level of productivity as a younger bloke and not 40 hours a week.

    So to get businesses actually hunting down old people with job offers, they could allow business to DOUBLE-EXPENSE for tax purposes wages given to people of retirement age. Supposing you pay some old bloke to do two eight hour shifts at 12 dollars per hour every week. So every week instead of claiming his labour costs at 192 dollars, you get to reduce your taxable income by 384 dollars. Since the company tax rate is 30% you would have then gotten 16 hours of work out of the old bugger for only $76.80c. An effective cost to the business of only $4.80 per hour. So its cheap labour for the business and a reduction in business tax liabilities. Paid for by dissolving government agencies.

    Wouldn’t you rather cut payroll, excise taxes and so on once there is less Government to have around?

    WHATS THIS “RATHER” BUSINESS? I DIDN’T SAY I WOULDN’T WANT TO CUT PAYROLL AND EXCISE. YOU KNOW DAMN WELL THAT I WOULD. THAT FLIES PRETTY CLOSE TO THE IMPLIED-LIE. FROM HERE ON IN MAKE SURE YOU COPY ANY OF YOUR POSTS BECAUSE ANYTHING LIKE THAT WOULD FORCE ME TO WIPE THE WHOLE THING EVEN IF THERE IS SOME WORTHY COMMENTS WITHIN.

    5. They could allow people to register their older relatives as dependents thereby lifting their own tax free threshold up sky-high. Of course this would be done in such a way as not to allow double-dipping.

    This is probably more realistic than the current situation.

    RIGHT.

    6. They can get rid of taxes on interest earnings, increasing savings rates more generally, and the incomes of pensioners who have savings stashed away.

    You’ve made one good suggestion – savage income tax. But you’re ignorant to the fact many pensioners that your heart bleeds for don’t have savings because they were taxed so heavily not to raise an army of taxeaters but to pay for publicly owned assets.

    THEY WERE TAXED HEAVILY BY THIEVES. THATS THE LONG AND SHORT OF IT. ITS NOT TRUE THAT THEY WERE TAXED HEAVILY SPECIFICLY TO CONSTRUCT INFRASTRUCTURE.

    Your treatment of elders and dependents is actually far sighted but to keep on gypping successful self managed super owners is just mean like taking lollies from a kid.

    RIGHT THATS A STRAIGHT LIE. YOU ARE CLAIMING THAT I WANT TO GYP SELF-RETIREES. WHEREAS THE WHOLE POST IS ABOUT INCREASING THEIR NUMBER, PROPORTION, AND NET WEALTH.

    MAKE SURE YOU SAVE YOUR POSTS. BECAUSE THATS THE LAST LIE I’M LETTING THROUGH. AS A MATTER OF FACT I WILL HAVE TO COME BACK AND WIPE THIS POST AFTER AWHILE. THIS IS TOO OUTRAGEOUS AND BLATANT A LIE. SO REDO THE WHOLE THING WITHOUT THE LIES IN IT.

    Why do you want to do that for? If you force them to keep working you don’t think they’ll be resentful and just go on welfare for long enough and draw down their entitlements anyway after the 39 week rule???

    A CONTINUATION OF LYING.

    Auctioning off public assets to buy out pensioners is a fair deal.

    NOTHING COULD BE MORE STUPID THAN THIS. THATS JUST SELLING THE FARM FOR CURRENT CONSUMPTION. TOTALLY OUT OF THE QUESTION. SALES SHOULD BE IN THE SMALLEST CASH-FLOWS POSSIBLE AND ANY REVENUE OUGHT TO GO STRAIGHT TO DEBT RETIREMENT.

    Pension schemes are Ponzi schemes.

    YES INDEED. AND ITS HARD TO WEAN OUT OF THEM FAIRLY ONCE YOU GET THEM STARTED. BUT ARE YOU MAKING THE IMPLIED LIE THAT THIS WASN’T MY POSITION?

    We’re just giving them their capital back at a premium.

    THATS A SILLY WAY OF LOOKING AT IT. YOU ARE JUST TRYING TO JUSTIFY SELLING ASSETS IN MASSIVE BUNDLED AUCTIONS FOR THE PURPOSE OF CURRENT CONSUMPTION. OUT OF THE QUESTION.

    This is a fair price to pay to ensure a younger and smaller demographic base don’t get the billy O taxed out of them to fund the pensions.

    NO YOU ARE JUST MAKING EXCUSES FOR TAXEATER PLUNDERING.

    An auction is as fair as any disposal of assets will get.

    NO ITS NOT. NOT THE WAY WE’VE BEEN DOING IT LEASTWISE.

    A sell off is better than “mass sackings”.

    NO IT ISN’T. MASS-SACKING IS GETTING RID OF CURRENT CONSUMPTION.

    There is less frictional unemployment.

    WHATS WRONG WITH FRICTIONAL UNEMPLOYMENT? IT LEADS TO EMPLOYMENT AFTER ALL OR IT WOULDN’T BE FRICTIONAL. DUMB ILLOGICAL ARGUMENT. FRICTIONAL UNEMPLOYMENT IS GOOD IN THIS CASE SINCE IT LEADS TO EMPLOYMENT IN TAXPAYING, RATHER THAN TAXEATER JOBS.

    The level of Government spending on the various departments etc falls by the same amount.

    THATS RIDICULOUS. YOU ARE HAVING TO RESORT TO CRAZY-TALK TO MAKE YOUR PLUNDER AND SPEND SCHEME STICK.

    Objectionable Government departments like the Office for the Status of women should be shelved regardless.

    RIGHT. AND PRETTY MUCH 99% OF THE REST OF THE DEPARTMENTS AS WELL.

    The taxes can be cut by the same level and more since we don’t have to pay for pensions.

    OF COURSE WE HAVE TO PAY THE PENSIONS. IT WILL TAKE DECADES TO WEAN OFF THEM. AT LEAST 30-50 YEARS. YOU ARE TALKING CRAZY-TALK IN ORDER TO JUSTIFY A CRAZED SHORT-TERMIST PLUNDERING SCHEME.

    If we sacked everyone in the Government held parts of Australia post, it would shut down and the franchisees would be hurt, as would all mail users.

    WHY ON EARTH DID YOU TAKE THE AUSTRALIA POST FOR YOUR EXAMPLE. JUST SHOWS HOW FAR YOU HAVE TO GO TO KEEP THIS SILLY ARGUMENT IN THE AIR. WITH THE POST YOU JUST DEREGULATE AND TURN OFF THE MONEY. TOO EASY.

    Australia Post is self financed, so what would be the point of sackings, it is a Government owned, profit making business enterprise?

    AGAIN. WHY DID YOU FIND YOURSELF HAVING TO CHOOSE ONE OF THE ONLY SELF-FINANCED GOVERNMENT DEPARTMENTS TO KEEP YOUR ARGUMENT IN THE AIR? ITS BECAUSE YOUR ARGUMENT IS SILLY. ALLOW COMPETITION. TOO EASY.

    You may not like my point of view but your generalisation of how to reduce the public sector ignores idiosyncracies like the public-private partnership that is Australia Post.

    PUBLIC-PRIVATE PARTNERSHIPS ARE NO GOOD.

    Finally: of course Aussie Post shouldn’t be guaranteed a price monopoly on mail. Probably a good example of inefficiency vs banks – who get 25% ROE practically every year.

    BANKS ARE TOTALLY INEFFICIENT. YOU ARE TALKING CRAZY-TALK HERE AS WELL. THEY ARE THE MOST INEFFICIENT COMPANIES IN THE COUNTRY. THE BIG FOUR ARE IN ANY CASE. TAKE AWAY THEIR MONEY-CREATION ABILITY AND THEY’D ALL GO BROKE. GIVE THE RIGHT TO CREATE THE NEW MONEY IN THIS COUNTRY AND I’D DIE THE RICHEST MAN IN AUSTRALIA IF I LIVED ANOTHER 30 YEARS. SO YOU HAVE THINGS ASS-BACKWARDS THERE.

    http://www.dbcde.gov.au/post/frequently_asked_questions#faq_2_reserved_service_cso_1


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