JOBKEEPER WASTED BILLIONS - AND THE ‘POLITICS OF ENVY’ DEFENCE DOESN’T STACK UP

The New Daily, 3 September 2021

A billion is hard to wrap your head around.

Some billionaires say that they’re part of the ‘three comma club’. In the comedy series The Hollowmen, the political insiders decide they’ll need to spend billions of dollars before the public whistles in awe.

So if you haven’t been watching the scandalous waste from the JobKeeper scheme, don’t blame yourself for forgetting to groan on cue.

Some quick background. In the year from March 2020, JobKeeper paid out $89 billion to firms based on their salary bill.

For companies that would’ve otherwise fired their staff, that’s money well spent.

For those that would’ve kept trucking along regardless, it was free cash for the bottom line.

AUSTRALIANS DESERVE TO KNOW WHERE JOBKEEPER WENT – IT SHOULDN’T BE A STATE SECRET

The Guardian, 2 September 2021

As economies locked down in early 2020, many countries around the world established wage subsidy schemes. Economists know that employment relationships are easier to break than make. So wage subsidy schemes incentivise firms to maintain employment through a temporary slump.

The British scheme was called the job retention scheme. In New Zealand, it was the Covid wage subsidy. Canada set up the Canada emergency wage subsidy. The United States created the paycheck protection program.

Some of these schemes were established by progressive governments; others by conservative governments. But whether it was Johnson or Ardern, Trudeau or Trump, other countries’ wage subsidy schemes had one thing in common: full transparency. Taxpayers could log on to a website and find out the names of every firm that got wage subsidies.

Transparency isn’t a left- or right-wing value; it’s simply good government. It reflects the fact that taxpayers are the people who pay the government’s bills, and taxpayers should know how the money is spent. As former US supreme court Justice Louis Brandeis put it, sunlight is the best disinfectant.

Australia too created a wage subsidy scheme (though not before Scott Morrison called it a “dangerous” idea). Yet JobKeeper didn’t include any transparency. The government provided no information about which firms received JobKeeper. None, zilch, nada.

VACCINE INCENTIVES WORK, AND MR MORRISON KNOWS IT

The Canberra Times, 9 August 2021

Just 16 per cent of Australians are vaccinated against COVID-19 - the second-lowest rate in the OECD group of advanced countries. According to the Grattan Institute's modelling, Australia needs to vaccinate 80 per cent of the population (or 90 percent of adults, if children are unvaccinated) before life can return to normal. The Morrison government's modelling sets a slightly lower target, with Phase C of its plan (which lifts all restrictions on outbound travel) taking effect when 80 per cent of adults are vaccinated.

NO NEED TO PLAY AGATHA CHRISTIE GAMES WITH THE NATION'S CHARITIES

The Canberra Times, 30 June 2021

If you listen to the Morrison government talk about activist charities, you'd think they were engaged in an epidemic of lawlessness.

Yet over the past three-and-a-half years, the charities commission deregistered just two charities for breaking the law in pursuit of activist goals. With 59,000 charities in operation, that means the annual chance of a charity being deregistered for illegal activism (10 in 1 million) are about the same odds that the typical Australian will commit a murder (9 in 1 million).

IT'S HIGH TIME TO MAKE THE BIG MULTINATIONALS PAY THEIR FAIR SHARE OF TAXES

Daily Telegraph, 16 June 2021

Ever wondered why your Netflix statement bills to a company in the Netherlands, why people who place Facebook ads are charged by a company in Ireland, and why the tiny island of the Bahamas is the sixth-largest foreign owner of Australian farmland?

In the era when most multinationals produced manufactured goods, taxation was straightforward: the profits were taxed in the country where the goods were produced, and where the firm was headquartered. But these days, firms have become adept at shifting profits into low-tax jurisdictions. Two fifths of multinational profits now pass through tax havens and so-called “investment hubs”. Over half the corporate profits recorded in Ireland are shifted from other countries. In recent years, frustration with the slow pace of debates over multinational tax reform has led more than 40 nations to enact or announce new digital sales taxes on technology firms such as Facebook and Google.

INSTEAD OF A RACE TO THE BOTTOM, LET'S HAVE A RACE TO GLOBAL TAX FAIRNESS

The Canberra Times, May 25 2021

A few years ago, Scott Morrison was vociferously arguing that Australia was in a race on company taxes. Both Britain and the United States were cutting their company tax rates, and Morrison alleged that if Australia didn’t follow suit, ‘the Labor Party will leave Australian businesses stranded on a tax island — uncompetitive with the United States, with the United Kingdom, with Singapore’.

How things can change. The British Conservatives have now legislated to increase the company tax rate from 19 percent to 25 percent, taking effect from 2023. To pay for his infrastructure plan, President Biden is committed to increasing the US company tax rate from 21 percent to 28 percent. A global race to the bottom in company taxes has been replaced with a recognition that firms should pay their fair share of tax. Those elements in the Liberal Party still pushing for Australia to cut company taxes are looking as old-fashioned as the climate change deniers.

Reply to Laura Tingle, ‘The High Road: What Australia Can Learn from New Zealand’

Quarterly Essay, April 2021

Visiting Te Papa, New Zealand’s national museum in Wellington, our family stopped in front of a dramatic exhibition on the Treaty of Waitangi. “Where can we see Australia’s treaty?” one of my young sons innocently asked.

Where indeed. As Laura Tingle points out, the lack of a treaty with the original inhabitants of this land is one of the areas in which Australia lags behind our antipodean neighbour. Across the ditch, Māori have dedicated seats in parliament, the All Blacks perform the haka at the start of rugby matches, and a government minister recently delivered an entire speech in the Māori language. Meanwhile, the Morrison government might have excised “young” from “Advance Australia Fair,” but as Tingle points out, it has effectively downgraded the Welcome to Country and failed to deliver an Indigenous Voice to Parliament.

BILLIONAIREKEEPER: THE GROSS MISMANAGEMENT OF JOBKEEPER IN THE PANDEMIC

The Canberra Times, March 29 2021

A pair, a twin, a double. The number two has been dubbed by mathematicians ‘the oddest prime’. It’s a quirky number, and it’s the only number you need to understand some really odd things that have been happening in the economy lately.

Let’s start with billionaires. According to Bloomberg’s Billionaire Index, Australia’s billionaires have had a remarkable twelve months. Since COVID hit, the typical Aussie billionaire has seen his or her wealth almost double. That’s right - double. If you’re an Australian billionaire who started the pandemic with $1 billion, you’re now most of the way to $2 billion. 

Some have been coy about this, others less so. A year ago, Gerry Harvey told 60 Minutes ‘Why are we so scared about getting this virus? There’s nothing to be scared of.’ Harvey Norman’s air purifier sales had doubled, he said, while freezer sales were up fourfold. ‘We've got enough sales people, enough customers and we're doing really good business’. By the end of the year, 1.8 million had died from COVID, and Harvey Norman had enjoyed its most profitable year ever.

FRYDENBERG DEFENDS TAXPAYER-FUNDED EXECUTIVE BONUSES

In Question Time today, I asked the Morrison Government “how much of the taxpayer money used to fund JobKeeper has been spent on executive bonuses?”

Rather than condemn the misuse of JobKeeper to fund million-dollar bonuses for millionaire CEOs, Treasurer Josh Frydenberg defended the practice, saying “decisions by businesses about remuneration are matters for them”.

This bizarre defence of BonusKeeper is at odds with the many who have criticised the practice of firms paying executive bonuses after receiving JobKeeper, including:

• The Australian Taxation Office
• The Business Council of Australia
• The Council of Small Business of Australia
• Former Liberal Premier Jeff Kennett

JOBKEEPER WASTE COULD COST 250,000 JOBS

A new report from Ownership Matters today analyses ASX300 firms that received JobKeeper subsidies in the second half of 2020. It finds that one-fifth of the JobKeeper they received went to entities that reported an increase in their underlying earnings metrics from pre-pandemic levels.

This is a shocking waste. JobKeeper was suppose to support firms that were suffering. JobKeeper was never meant to go to firms whose profits were rising.

The Treasurer has refused to release data on overall JobKeeper payments. If the pattern identified by Ownership Matters holds up for firms outside the ASX300, then it suggests that in the second half of 2020, almost $10 billion of JobKeeper went to firms whose profits rose.