# Should wealth distribution be equal?



## Tyler Durden (17 November 2011)

> ONE OF the main issues raised by the Occupy demonstrators is the unfair distribution of wealth. Their slogan focuses on the extreme difference between the richest and the poorest. ''We are the 99 per cent,'' say the banners and T-shirts, pointing out that 1 per cent of the world's population has somehow clawed its way to disproportionate money and power. Time to do something about this unnatural distribution, no?
> 
> The economist Edward Wolff, of New York University, has pointed out that, as of 2007, the top 1 per cent of households in America owned 34.6 per cent of all privately held wealth, and the next 19 per cent had 50.5 per cent of the wealth. This means 20 per cent of the people owned 85 per cent of the wealth, leaving 15 per cent for the bottom 80 per cent of the people. No one who is interested in an equitable society can fail to be irked by this unfairness.
> 
> ...




http://www.smh.com.au/world/science...w-all-boils-down-to-maths-20111116-1njee.html

I was reading this and thought, why do we always fight for fairness? Why do we think it is so unfair that wealth is unequally distributed?

I mean, most rich people have obviously got the money system figured out, and they are being rewarded for it, whereas other people either haven't got it figured out, or are too lazy to work for money - so why should they have the same amount of money as someone who is smarter/harder working?

Isn't our capitalistic world just an altered version of survival of the fittest?


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## waimate01 (17 November 2011)

Tyler Durden said:


> http://www.smh.com.au/world/science...w-all-boils-down-to-maths-20111116-1njee.html
> 
> 
> Isn't our capitalistic world just an altered version of survival of the fittest?




Absolutely it is.

But evolution performs experiments with all sorts of different initiatives, and I fear the notion of a large neocortex will go down in history as a failed experiment.

In strict evolutionary terms, the most successfully adapted specimens will survive and reproduce more. In our modern western society, those who are 'wealthy' through hard work, intelligence and diligence tend to reproduce less. Those who are dis-interested, unmotivated and largely unemployable tend to reproduce more. Gross generalisations, I know, but gross generalisations are always true (jk). 

Our neocortexes have created a system where the useless are rewarded and supported by the useful in their reproductive efforts. For evolution to work, the useless would need to be starving to death living under an overpass, and all of their progeny with them except for the ones prepared to pull their fingers out and do something.

Such a thing is, of course, inhumane. And so we feed and clothe them, and give them the mechanisms to complain about how unfair it is. 

*The net effect is that intelligence is 'self-limiting' in an evolutionary sense; because intelligence leads to compassion, and compassion thwarts evolution.*

Not saying we should let the unemployed starve, just making observations on the Darwinian effect of where we find ourselves as a species. The fossil record shows evolution has been down plenty of cul de sacs before. No reason to think we're not another one. The Occupy people are unwitting advocates for evolution to try something else.


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## pixel (17 November 2011)

Robert A. Heinlein:







> Throughout history, poverty is the normal condition of man. Advances  which permit this norm to be exceeded ”” here and there, now and then ””  are the work of an extremely small minority, frequently despised, often  condemned, and almost always opposed by all right-thinking people.  Whenever this tiny minority is kept from creating, or (as sometimes  happens) is driven out of a society, the people then slip back into  abject poverty.
> This is known as "bad luck."



more at http://en.wikiquote.org/wiki/Robert_A._Heinlein


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## McLovin (17 November 2011)

They're not asking for wealth to be equally distributed, they're asking for wealth to be less unequally distributed.


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## DocK (17 November 2011)

McLovin said:


> They're not asking for wealth to be equally distributed, they're asking for wealth to be less unequally distributed.




Excellent point.  It'll be a sad, sad world when every child leaving school aspires to be a hip-hop artist/actor/model/investment banker/reality tv star and nobody is interested in being a nurse/cop/teacher/farmer because society is telling them these professions are unworthy by $ for $ comparison.   I strongly believe in a system which rewards those willing to put in the time, effort, ability or unique talents, but something seems to have gone astray over the past several years - it seems to me that when I was a child there wasn't such a huge gulf between the salaries of CEOs and the like, and the rest of the workforce.   Just seems society has its priorities not quite right when those we rely upon to keep us safe, healthy, educated etc are being sent a message that they're not really "valued" by the community.  I don't claim to have the answer, and I'm not about to Occupy anything or anywhere - I'm too busy working, unlike most of the protestors   But I get what I think some of them are protesting about.


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## demiser (17 November 2011)

waimate01 said:


> Absolutely it is.
> *The net effect is that intelligence is 'self-limiting' in an evolutionary sense; because intelligence leads to compassion, and compassion thwarts evolution.*




I've had many heated discussions over this topic, especially in the last month or so, however you sum it up rather more elegantly.

As far as the original topic is concerned, No, and considering the kind of site i'm responding on, my answer is probably not that surprising.  It really comes back to the individual, and their drive and desires.  Some people are driven by power and money, others strive for happiness and reward, and a few people are lucky enough to find both.

Although I do believe in minimum wages, and social benefits such as health and education, I don't believe that I should also be forking out for some bludgers plasma TV and new pair of $300 sun glasses.

The other side of the topic about 'less unequal distribution', is a little harder.  Yes everyone should be able to make a comfortable living, however if the menial jobs had a high salary, why would anyone put in the effort, or take the risks associated with the more difficult positions ?

I know personally that I am somewhat jealous of some of the higher salaries people get, but on the flip side, there is no way I would want their jobs / hours / or responsibility.  Along the same line, I am envious of what some people reap from the stock market however I am currently not skilled enough, or brave enough to risk enough of my capital to see those sorts of returns. 

I generally believe that the current system (in australia anyway is pretty good, yes some people are given a hand up by either family money, or good contacts, but for the most part, if you are willing to put in the effort, you will be rewarded.


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## Wysiwyg (17 November 2011)

For a start, everyone can't be wealthy because there would be no less wealthy to compare. Most of our observations are comparative. Good and bad, big and small etc.

Duality is a way of thinking.


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## rcm617 (17 November 2011)

Its really all a matter of balance, with the more gifted among us getting a greater reward than those with lesser ability.
However I believe in the last few years that balance has swung far too much in favour of the high earners. This is compounded by the fact that most of the higher earners, especially in western society, are in control of banks etc, which in reality do not actually produce anything, so their income has to come out of the income of other people. They have been taking huge risks with other peoples money to earn huge bonuses, which continue to be paid despite the massive mistakes made by these people.
No wonder low and average income earners who see no future for themselves or their families in this frightening new world, are getting resentful and want a new world order.


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## drsmith (17 November 2011)

Wealth distribution should be fair (whatever fair is), but our tax system is too complex for that.


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## Garpal Gumnut (17 November 2011)

My mate Ted has a series of talks on this subject.

Equality makes for better societies.

[video]http://www.ted.com/talks/richard_wilkinson.html[/video]

gg


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## Smurf1976 (17 November 2011)

Equal no, there should quite rightly be an incentive to work, innovate, take risks etc.

But any CEO who is paid $10 million a year and who doesn't expect a flood of wage claims from workers is an outright fool. And you'll never convince me that's a fair income anyway - it only attracts people with short term objectives (in it for the money) who couldn't give a damn about the long term prospects of the company they are supposedly managing.


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## Tyler Durden (17 November 2011)

McLovin said:


> They're not asking for wealth to be equally distributed, they're asking for wealth to be less unequally distributed.




True, but the underlying rationale remains - the rich are earning too much. Question then is, do they deserve it?


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## So_Cynical (17 November 2011)

McLovin said:


> They're not asking for wealth to be equally distributed, they're asking for wealth to be less unequally distributed.




What a wonderful way to put it.


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## drsmith (17 November 2011)

Smurf1976 said:


> Equal no, there should quite rightly be an incentive to work, innovate, take risks etc.
> 
> But any CEO who is paid $10 million a year and who doesn't expect a flood of wage claims from workers is an outright fool. And you'll never convince me that's a fair income anyway - it only attracts people with short term objectives (in it for the money) who couldn't give a damn about the long term prospects of the company they are supposedly managing.



Only a Jedi Master is worth $10m a year. 

Another obscenity is option schemes where executives get upside but no downside for no capital outlay. Their interests would be much better alligned with the long term future of the company if they were limited to the choice of risking their own capital for a financial position in the company's future.


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## So_Cynical (17 November 2011)

Tyler Durden said:


> True, but the underlying rationale remains - the rich are earning too much. Question then is, do they deserve it?




The CEO of Orica was on the news tonight, he makes 7 mill a year...think he deserves it?, just how does one deserve 7 million a year for running a big company?

I cant see how anyone doing anything deserves to make 7 million a year.


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## Julia (17 November 2011)

demiser said:


> I've had many heated discussions over this topic, especially in the last month or so, however you sum it up rather more elegantly.



Yes, indeed.  Great post from Waimate, typical of his/her other posts.



> As far as the original topic is concerned, No, and considering the kind of site i'm responding on, my answer is probably not that surprising.  It really comes back to the individual, and their drive and desires.  Some people are driven by power and money, others strive for happiness and reward, and a few people are lucky enough to find both.



Agreed.  But the driving force is incentive, regardless of its origin.  Whatever one desires in life, some of us will work and equip ourselves to achieve this, whilst others will sit around and whine about why others do better than they do.




> Although I do believe in minimum wages, and social benefits such as health and education, I don't believe that I should also be forking out for some bludgers plasma TV and new pair of $300 sun glasses.



+1.



> The other side of the topic about 'less unequal distribution', is a little harder.  Yes everyone should be able to make a comfortable living, however if the menial jobs had a high salary, why would anyone put in the effort, or take the risks associated with the more difficult positions ?



It comes back to the need for incentive.



> I know personally that I am somewhat jealous of some of the higher salaries people get, but on the flip side, there is no way I would want their jobs / hours / or responsibility.



Agreed, but the very huge responsibility is why I'm not at all jealous of those earning much more than I do.  



rcm617 said:


> Its really all a matter of balance, with the more gifted among us getting a greater reward than those with lesser ability.
> However I believe in the last few years that balance has swung far too much in favour of the high earners. This is compounded by the fact that most of the higher earners, especially in western society, are in control of banks etc, which in reality do not actually produce anything, so their income has to come out of the income of other people. They have been taking huge risks with other peoples money to earn huge bonuses, which continue to be paid despite the massive mistakes made by these people.



I wouldn't be quite so cavalier about people who run the big banks here.  They are a large part of what allowed Australia to bypass the GFC, more than any government intervention.  

People always talk about the high salaries of the bank CEOs.  The suggestion is that CEO's of other companies earn much less.  It seems to me pretty silly to have that discussion in dollar terms.  To express salary packages in terms of a percentage of market cap would make more sense and sound much less horrifying.

Let's remember that CEOs these days are functioning in a global market.  If you're participating in this forum because you believe the market works, why wouldn't you accept that the employment market sets the range of executive salaries?



> No wonder low and average income earners who see no future for themselves or their families in this frightening new world, are getting resentful and want a new world order.



They have a choice of seeing the world this way, or of choosing instead to be inspired by the success of others, and working hard to emulate them.

One thing is for sure:  those who sit around whining in envy about how disadvantaged they are will always be so disadvantaged.  
Instead, take the initiative and learn how to make your life better.

NB  Such a philosophy absolutely excludes people with any sort of disability. We should be helping these people way more than we are now.




Tyler Durden said:


> True, but the underlying rationale remains - the rich are earning too much. Question then is, do they deserve it?



I don't think you can decide whether anyone "deserves" what they earn.  It's always relative to the situation, the industry they're in and a host of other factors.

Congratulations, tyler, on coming up with a thought provoking thread.


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## drsmith (17 November 2011)

So_Cynical said:


> I cant see how anyone doing anything deserves to make 7 million a year.



Agreed.

The way the rocks are moved falls well short of the Jedi method.


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## Glen48 (17 November 2011)

OR YOU CAN DO IT THIS WAY:
http://www.brasschecktv.com/page/5228.html


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## Starcraftmazter (18 November 2011)

Well wealth will never be equal in a capitalist society, but I think the issue is that in the last 20 years or so of globalisations, things have gotten much worse for the common folk - especially in USA, who saw zero real wage growth in that time period.

Meanwhile the richest people get ever larger bonuses, even as their companies are losing massive amounts of money. Lots of corporations are not even paying any tax.

This is becoming too much akin to the communist critisisms of capitalism, where the vast working class does all the work and pays all the taxes, while the rich do nothing but profit from them.


I will again put forward that there must be a minimum and maximum (not too high, few hundred thousand) maximum salary (including bonuses), and they must only ever rise proportionally to each other.


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## DocK (18 November 2011)

Garpal Gumnut said:


> My mate Ted has a series of talks on this subject.
> 
> Equality makes for better societies.
> 
> ...




Thanks for that link GG - it was very informative and thought-provoking.  

Must admit I almost didn't bother looking  at it as not all of your posts are of the most, cough "serious" cough nature , but I'm very glad I did.  Couldn't help being annoyed that he'd obviously put on his shirt straight from the box though


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## moXJO (18 November 2011)

Starcraftmazter said:


> I will again put forward that there must be a minimum and maximum (not too high, few hundred thousand) maximum salary (including bonuses), and they must only ever rise proportionally to each other.



What happens if you start a business and it makes millions, are you no longer entitled to the money?


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## skc (18 November 2011)

The two most important things to me are...

- Facilitate equality in opportunity - if you work hard and work smart, you have the opportunity to make it... like Will Smith in Pursuit of Happiness. I like to believe this is still true in USA and Australia, where innovative entrepreneurs are rightfully rewarded. The government can assist here by providing a quality education system and enact equal opportunity legislations. 

- Fix linkages between rewards, incentives and responsibilities - this is much talked about but also much harder to fix. You can't pay someone to go to the casino, let them share the upside but not the downside, and not expect them to gamble like crazy. This applies to wall street banks, but also big company CEOs. That's why most mergers and acquisitions don't work, because CEOs will always err on the side of optimism... it's a pretty big bonus if it all works out, but it's the shareholders' fund that's at risk. And if they end up destroying thousands of jobs, too bad. 

Fix these 2 things and I don't really mind how much someone gets paid or how much wealth they have. Equality of pay isn't right or meaninful, and capping maximum pay will be counterproductive.


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## McLovin (18 November 2011)

Julia said:


> I wouldn't be quite so cavalier about people who run the big banks here.  They are a large part of what allowed Australia to bypass the GFC, more than any government intervention.




I don't think so. The banks were well and truly caught with thier pants down when the GFC hit. If it wasn't for the government guarantee they would have had a serious liquidity problem. The banks had relatively clean balance sheets (something I attribute more to APRA than the banks themselves) but under the extreme duress that markets were in it didn't matter, US Treasuries look a far safer option when you think the end of the world is nigh.



> In the months following this intensification of the crisis, there was virtually no demand globally for unguaranteed financial institution debt, particularly for terms greater than one year, and what little unguaranteed debt was issued globally was at exceptionally high spreads. During this period of greatest dislocation, the guarantee enabled Australian banks to issue larger volumes and at much longer terms than would have been possible in unguaranteed form. The large issuance volumes were possible because the guarantee made regular buyers of financial institutions’ debt more comfortable with the risk (as the debt was afforded the Australian Government’s AAA rating) and also broadened the investor base, by attracting investors whose mandate covered sovereign-guaranteed debt. Given the historically high spreads at the time, the guarantee substantially reduced the cost to financial institutions of issuing term debt.
> 
> ...
> 
> Initially, the Government guarantee enabled banks to issue bonds for larger amounts and for longer terms than unguaranteed securities. Much of the increase in bond maturities over 2009, however, reflects the ability of the major banks to issue unguaranteed debt at longer maturities as market conditions have improved, including beyond the five-year limit of the Guarantee Scheme. While the distribution of bond maturities at issuance has moved toward longer terms, it is not yet back to the patterns prevailing prior to the financial crisis. For example, around 50 per cent of bond issuance since 2009 was at terms of four years or more, up from 35 per cent in the initial stage of the financial crisis, though below the 65 per cent share previously. The average term of issues domestically remains below the pre-crisis average, though the average maturity of bonds issued offshore over the past few months is around the pre-crisis average. Overall, the average maturity of the stock of bank bonds outstanding is around 3 ¼ years, up from 2 ½ years in late 2008.




http://www.rba.gov.au/publications/bulletin/2010/mar/5.html


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## craft (18 November 2011)

A free market will define what success and failure is and reward accordingly.  As a society we should not necessarily be happy when its definition of success doesn’t pay attention to effort, fairness, responsibility or equality.   Society should define what boundaries free markets operate within and where we intervene for humanity’s sake.

I believe that that a more equal wealth distribution creates a better society – A free capitalist market will not deliver that.

But we can. Generally speaking the 99% who are ‘occupying’ at the moment are residents on the 99th floor, complaining about those living on the 100th floor whilst ignoring all those in other countries living on the 98 floors below.

If you are really concerned with wealth equality start yourself by distributing some of your wealth to those on the 98 floors below. If the 99% do that than the 1% will get the message that we are serious about equality.


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## McLovin (18 November 2011)

Tyler Durden said:


> True, but the underlying rationale remains - the rich are earning too much. Question then is, do they deserve it?




Whether they deserve it is an answer with too many variables. But the wealthier you are the more you benefit from the protection of the state (police, property rights, regulation, defense), so you should have to pay your way.

I see a lot of similarity between the Tea Party and Occupy movements; they are both essentially sick of the middle class shouldering the burden while the rich carry-on like nothing has happened.

Inequality in the US is now the same as China and fast catching up to Mexico. How does that benefit the US? High inequality leads to many undesireable consequences.


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## Starcraftmazter (19 November 2011)

moXJO said:


> What happens if you start a business and it makes millions, are you no longer entitled to the money?




You are entitled to get the highest possible salary under such a scheme.


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## Wysiwyg (19 November 2011)

Could the thread opener tell us where wealth is distributed? Government? Don't know?


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## pixel (19 November 2011)

Starcraftmazter said:


> You are entitled to get the highest possible salary under such a scheme.



 And what happens to the Millions that my idea has made over and above that salary? Who - other than the inventor/ risk taker/ focused entrepreneur - has a claim that they "deserved" a share of it? 
And if I as the owner want to branch out and expand into another endeavour: Whose permission do I need to obtain before I'm allowed to put all those $Millions at risk again? Remember, I started the original business off my own bat, accepting responsibility and risk, and made it all work and profitable. Stepping up with another idea and Plan, again taking risk and responsibility: What "salary" would then be possible under the "scheme"? Wouldn't it be natural to argue "Higher risk, higher reward, higher salary." ?
In that case, the first instance of "highest possible salary" would no longer hold true.

No, IMHO restricting the amount of money a person may earn is not going to work. What can be better applied, however, is the yardstick used to determine a person's influence on a company's bottom line. 

Just as there are _Australian Standards_ for all kinds of "codes" - be they buildings, appliances, whatever - there could be standard KPMs for directors and chief officers of companies; set the base salary at x-times AWE and pay a performance bonus on achievement of certain objective KPMs taken annually from the bottom line. But the total distributed "bonus" should never exceed a reasonable (small) percentage of actual profit - unlike in many current cases, where a caretaker gets rewarded an obscene amount that doubles the company's actual Loss.

And Directors' Fees should definitely be looked into - especially if the same person "directs" several companies at the same time. I believe there have been limits set as to how many boards a person can be a member of; but it appears the purpose of that limit has been circumvented by grossly increasing the cap that a Board can be paid. It never ceases to amaze me, how a director attending a handful of meetings in a year can claim what amounts to $10,000 or more an hour. But that's probably food for a different topic.


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## moXJO (19 November 2011)

Starcraftmazter said:


> You are entitled to get the highest possible salary under such a scheme.




Why stay in the country, why take risks, why inovate? What is the point of working hard.


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## moXJO (19 November 2011)

Just give share holders greater powers to dictate how much ceo's get and leave it at that. You dont need to go ballbreakingly red.


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## pixel (19 November 2011)

moXJO said:


> Why stay in the country, why take risks, why inovate? What is the point of working hard.



my point exactly



moXJO said:


> Just give share holders greater powers to dictate how much ceo's get and leave it at that. You dont need to go ballbreakingly red.



 Problem is, there is an "Old Boys' Club" mentality among the substantial shareholders that ensures increasing packages. It's running along the lines of "You scratch my back here, I'll scratch yours over there." Even the representatives of fund managers will be inclined to award ceos and directors higher remuneration, expecting to benefit when they move up into the next tier.
It's a tough one - and I don't pretend to have an answer.


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## Starcraftmazter (19 November 2011)

pixel said:


> And what happens to the Millions that my idea has made over and above that salary?




Cheaper product, higher salaries for employees, company bank account, etc.



pixel said:


> Who - other than the inventor/ risk taker/ focused entrepreneur - has a claim that they "deserved" a share of it?




Honestly, let's say the maximum salary is $500,000 - I think that's more than enough incentive. People do not invent things because they are greedy.



pixel said:


> And if I as the owner want to branch out and expand into another endeavour: Whose permission do I need to obtain before I'm allowed to put all those $Millions at risk again?




Nobody's.



moXJO said:


> Why stay in the country, why take risks, why inovate? What is the point of working hard.




Maximum salary possible not enough for you? Come on get real. The whole point of this is that the CEOs which get massive bonuses do not work hard, in fact as I've posted previously, research shows that CEOs who have the biggest bonuses actually perform worse.

Quite frankly, I would not want such stupid greedy people screwing over my economy.

Why innovate? For the benefit of mankind. Other motivations for innovations are rather irrelevant as they typically do not contribute positively to society.


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## pixel (19 November 2011)

Starcraftmazter said:


> Honestly, let's say the maximum salary is $500,000 - I think that's more than enough incentive. People do not invent things because they are greedy.



Are you serious? After tax and insurance, that doesn't even leave enough for a house!



> The whole point of this is that the CEOs which get massive bonuses do not work hard, in fact as I've posted previously, research shows that CEOs who have the biggest bonuses actually perform worse.



That's probably a fair comment, in spite of an inadmissible generalisation. Most of us would agree that higher hurdles must be built into contracts for managers and directors of public companies. 



> Why innovate? For the benefit of mankind. Other motivations for innovations are rather irrelevant as they typically do not contribute positively to society.



 That, IMHO, is based on the same fallacy that brought Communism undone: It assumes that all people are driven to do "the right thing" and to "advance society". Fact is, only a teensy minority is as altruistic as that; the Catholic Church commonly refers to them as Saints. Real people ask "what's in it for me?" and the amount of effort they put in will directly correlate to the achievable reward. For some, public recognition, in the form of fame and glory, may play a part - but most likely only, once they're already materially well-off. The majority of non-leaders however, will only do the absolute minimum to secure their food, shelter, and general wellbeing. Sometimes, they include members of their close family. If it comes to the crunch, most humans will even ask "the government" or the anonymous "community" for assistance when it comes to securing the same for their next of kin: aged care for parents; health care and education for their kids; parenting allowance for their spouses.

Look at te workers that "go North" for a while: They work in the Mines or construction for a few years at as high a wage as possible; then they return back home, buy a house, maybe start a family, and go fishing.


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## Eager (19 November 2011)

As far as wealth (or status, whatever that is) is concerned, it is my opinion that every person on the planet occupies a rung on a ladder - bloody big ladder, I know.

There simply has to be someone at the top, and someone at the bottom. If, magically, those on the bottom 10% were able to climb up (or horror, if that portion of the ladder was sawn off), there would still be a bottom to the ladder. The occupants of those rungs would still complain about unequal distribution even though they were once 'wealthier' than the people who were once below them. Maybe especially so!

Australians, generally, are near the very top of the ladder. The modern day beatniks that have occupied various cities of late in this country, have not realised that.


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## pixel (19 November 2011)

Eager said:


> Australians, generally, are near the very top of the ladder. The modern day beatniks that have occupied various cities of late in this country, have not realised that.



 Precisely: even the Australian beatniks themselves are, by global standards, near the top. And they're put that high up by the efforts (taxes, no matter how willy-nilly) of the ones they despise because they're higher up still - and allegedly "undeservedly" so.


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## moXJO (20 November 2011)

Starcraftmazter said:


> Maximum salary possible not enough for you? Come on get real. The whole point of this is that the CEOs which get massive bonuses do not work hard, in fact as I've posted previously, research shows that CEOs who have the biggest bonuses actually perform worse.
> 
> Quite frankly, I would not want such stupid greedy people screwing over my economy.
> 
> Why innovate? For the benefit of mankind. Other motivations for innovations are rather irrelevant as they typically do not contribute positively to society.




You live in a fantasy land.
:shake:


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## Beej (20 November 2011)

So_Cynical said:


> The CEO of Orica was on the news tonight, he makes 7 mill a year...think he deserves it?, just how does one deserve 7 million a year for running a big company?
> 
> I cant see how anyone doing anything deserves to make 7 million a year.




Do movie stars deserve to "earn" their 10s of millions of $$$ a year? Does Mel Gibson "deserve" to be mega-rich? Bruce Willis? Nicole Kidman? How about sports stars like Tiger Woods? Formula 1 racing drivers? And so on?

PS: I am not saying what the CEO or Orica may or may not deserve or be worth - but I do think that is a matter for the share-holders of that company to determine, is is really no-one else's business otherwise?


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## Mrmagoo (20 November 2011)

Ideally it should be equalised wealth for equal effort however the two main problems I see are : Discrimination and inheritance.

Discrimination is rampant against all sorts of people for all sorts of reasons. One of the main ones are class and age discrimination against lower class people. Creating a sort of trap which represents more of a class system than a merit based system.

Secondly inheritance makes it possible to inherit vast amounts of wealth creating a situation where some are more equal than others. 

So there should be some wealth re-distribution and wages should rise in proportion to each other.

Thirdly it is impossible to accurately value effort and the resultant market price is some combination of discrimination and scarcity than it is a measure of value.

For example, penicilin was donated for free to the world, does that make its value zero ?


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## Julia (20 November 2011)

Mrmagoo said:


> Ideally it should be equalised wealth for equal effort



How are you going to measure 'effort'?
How can you ignore capacity and skill, experience and intellect?  Level of responsibility?

A bricklayer may put in equal 'effort' to the CEO of a major bank (though as above i can't see how you could evaluate this).
Surely you're not proposing they should be paid equally?


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## So_Cynical (20 November 2011)

> I cant see how anyone doing anything deserves to make 7 million a year




-------------------



Beej said:


> Do movie stars deserve to "earn" their 10s of millions of $$$ a year? Does Mel Gibson "deserve" to be mega-rich? Bruce Willis? Nicole Kidman? How about sports stars like Tiger Woods? Formula 1 racing drivers? And so on?




Like i said, I cant see how anyone doing anything deserves to make 7 million a year, anyone, at any time, doing anything....now tell me that Steve jobs, tiger woods and Mel Gibson wouldn't have done what they did because they were salary capped at say 5 million per year.



Beej said:


> PS: I am not saying what the CEO or Orica may or may not deserve or be worth - but I do think that is a matter for the share-holders of that company to determine, it is really no-one else's business otherwise?




Unfortunately the retail share holders don't decide, the institutions decide and there decisions are heavy influenced by the fact that every board has at least 1 banker, 1 accountant and 1 former CEO....its a total (jobs for the boys) rort.


----------



## Starcraftmazter (21 November 2011)

pixel said:


> Are you serious? After tax and insurance, that doesn't even leave enough for a house!




I don't think one year's salary is meant to buy a house....furthermore, it would go further if the country you lived in did not have an epic housing bubble.



pixel said:


> That, IMHO, is based on the same fallacy that brought Communism undone: It assumes that all people are driven to do "the right thing" and to "advance society". Fact is, only a teensy minority is as altruistic as that; the Catholic Church commonly refers to them as Saints. Real people ask "what's in it for me?" and the amount of effort they put in will directly correlate to the achievable reward. For some, public recognition, in the form of fame and glory, may play a part - but most likely only, once they're already materially well-off. The majority of non-leaders however, will only do the absolute minimum to secure their food, shelter, and general wellbeing. Sometimes, they include members of their close family. If it comes to the crunch, most humans will even ask "the government" or the anonymous "community" for assistance when it comes to securing the same for their next of kin: aged care for parents; health care and education for their kids; parenting allowance for their spouses.




Not all - but the point is, those who are not are irrelevant, as they never do anything to benefit society anyway, so they have no net benefit to society.


----------



## prawn_86 (21 November 2011)

OK i havent read this whole thread as i have been away the last few days. I understand what they are protesting about, and to some point understand they want the re-distribution of wealth. But one thing i haven't heard/figured out is:

*How do they plan to acheive their goals? And what exactly are their goals?*

If anyone can answer this it would be appreciated


----------



## wayneL (21 November 2011)

prawn_86 said:


> OK i havent read this whole thread as i have been away the last few days. I understand what they are protesting about, and to some point understand they want the re-distribution of wealth. But one thing i haven't heard/figured out is:
> 
> *How do they plan to acheive their goals? And what exactly are their goals?*
> 
> If anyone can answer this it would be appreciated




Don't hold your breath.

As you may know we have an election in NZ on the 26th.

On another NZ forum where I cause much trouble, there are several professed socialist "occupy" sympathizers who are apt to whinge bitterly about the current "right wing" (ROTFLMAO) government. 

I have offered them the floor on how they would make things better, sans some sort of Kampuchean style "year zero" solution.

After several days and much prodding, I am still waiting.


----------



## waimate01 (21 November 2011)

Starcraftmazter said:


> I don't think one year's salary is meant to buy a house....




It is in Detroit!

http://www.trulia.com/home_prices/Michigan/Detroit-heat_map/


----------



## Julia (21 November 2011)

prawn_86 said:


> OK i havent read this whole thread as i have been away the last few days. I understand what they are protesting about, and to some point understand they want the re-distribution of wealth. But one thing i haven't heard/figured out is:
> 
> *How do they plan to acheive their goals? And what exactly are their goals?*
> 
> If anyone can answer this it would be appreciated



+1.



waimate01 said:


> It is in Detroit!



There was an interesting article in "The Weekend Australian" about the hazards of being a landlord in Detroit.  Investors imagining with the low entry prices they can become wealthy landlords can find themselves in a nightmare.
http://theaustralian.newspaperdirect.com/epaper/viewer.aspx


----------



## Mrmagoo (21 November 2011)

Julia said:


> How are you going to measure 'effort'?
> How can you ignore capacity and skill, experience and intellect?  Level of responsibility?
> 
> A bricklayer may put in equal 'effort' to the CEO of a major bank (though as above i can't see how you could evaluate this).
> Surely you're not proposing they should be paid equally?




I believe any man who works should be paid enough to for provide himself and for his family and have enough free money allow for leisure and educational opportunities for himself and for his family. 

I believe healthcare and education are undeniable rights of OUR civilisation on which the framework of our great culture is built and these should absolutely be provided by government.


----------



## Mrmagoo (21 November 2011)

Julia said:


> +1.
> 
> 
> There was an interesting article in "The Weekend Australian" about the hazards of being a landlord in Detroit.  Investors imagining with the low entry prices they can become wealthy landlords can find themselves in a nightmare.
> http://theaustralian.newspaperdirect.com/epaper/viewer.aspx




Well you've got to consider that the living conditions of your standard american would not be acceptable in Australia. 

So we've got bb's gen x and gen y. Now freeze wages and take away any access to free healthcare until generation z turns 25 and you've basically got the USA.


----------



## Julia (21 November 2011)

Mrmagoo said:


> I believe any man who works should be paid enough to for provide himself and for his family and have enough free money allow for leisure and educational opportunities for himself and for his family.
> 
> I believe healthcare and education are undeniable rights of OUR civilisation on which the framework of our great culture is built and these should absolutely be provided by government.



This post in no way answers my question about how you are going to measure "effort".
Where is allowance for skill and capacity?


----------



## moXJO (21 November 2011)

Lol at wages cap. Money is now a dirty word. Surprising attitudes to wealth on a share forum. Joke may be a better word for it. I have noticed the wave of envy from whingers on a few wealth creation forums. Good luck with it cause Im sick of reading the bs. The majority is leftist dribble that just doesnt work in the real world.


----------



## Starcraftmazter (22 November 2011)

You don't seem to understand that there are significant problems facing capitalism. A short-termism mentality like never before, CEOs given insane bonuses on a scale never before done in history to deliver purely short term results (which are frequently not even delivered), at the cost of long-term growth.

This problem is now being imported into government, which increasingly behaves in the same way.

Anyone who just ignores this problem with "herp derp lol" is a fool.


----------



## wayneL (22 November 2011)

Starcraftmazter said:


> You don't seem to understand that there are significant problems facing capitalism. A short-termism mentality like never before, CEOs given insane bonuses on a scale never before done in history to deliver purely short term results (which are frequently not even delivered), at the cost of long-term growth.
> 
> This problem is now being imported into government, which increasingly behaves in the same way.
> 
> Anyone who just ignores this problem with "herp derp lol" is a fool.




Nonsense!

The problem with capitalism is the collectivist/pseudo-Keynesian interference therein; which encourages those (and other) financial pathologies mentioned.

Capitalism left to it's own devices... left to do its job, would have sorted those problems when you were still in primary school.


----------



## Starcraftmazter (22 November 2011)

And why do they interfere? To make money from the flawed system. And how do you stop them?


----------



## wayneL (22 November 2011)

Starcraftmazter said:


> And why do they interfere? To make money from the flawed system. And how do you stop them?




If you accept the sense and reality of the business cycle, the capitalist system is not flawed... as an economic system.


----------



## So_Cynical (22 November 2011)

moXJO said:


> Lol at wages cap. Money is now a dirty word. Surprising attitudes to wealth on a share forum. Joke may be a better word for it. I have noticed the wave of envy from whingers on a few wealth creation forums. Good luck with it cause Im sick of reading the bs. The majority is leftist dribble that just doesnt work in the real world.




People wanting equality and a fairer world are whingers  i wonder what qualifications are required to be considered a DH? 

The chart below is from what some would call a leftist site so i expect some right wing whining.

http://www.faireconomy.org/news/ceo_pay_charts
~


----------



## moXJO (22 November 2011)

So_Cynical said:


> : i wonder what qualifications are required to be considered a DH?
> 
> 
> ~




You clearly have that covered, perhaps over qualified


----------



## trainspotter (22 November 2011)

moXJO said:


> You clearly have that covered, perhaps over qualified




I am getting this framed *screen capture*


----------



## Julia (22 November 2011)

So_Cynical said:


> People wanting equality and a fairer world are whingers
> ~



 Translation:  I want an equal share of the affluence in the world without having to exhibit any particular talent or capacity to earn that share.
Whilst I wait for this great benevolence to land in my lap, I will relentlessly continue to whine about the unfairness of the world.


----------



## moXJO (22 November 2011)

Starcraftmazter said:


> CEOs given insane bonuses on a scale never before done in history to deliver purely short term results (which are frequently not even delivered), at the cost of long-term growth.





And how long do you think that will last. Waynes point on business cycles is spot on and while the world has tried to defy gravity by artificial means, eventually we have to pay the piper. 
I'm not interested in what the next guy makes or having a whinge about it. Good luck to them.


----------



## Tyler Durden (23 November 2011)

So_Cynical said:


> People wanting equality and a fairer world are whingers




I wonder if these same people would whinge if they were on the wealthy end of the spectrum.


----------



## Starcraftmazter (23 November 2011)

moXJO said:


> And how long do you think that will last. Waynes point on business cycles is spot on and while the world has tried to defy gravity by artificial means, eventually we have to pay the piper.
> I'm not interested in what the next guy makes or having a whinge about it. Good luck to them.




The fact that it's happening is proof that the system is flawed in itself. It doesn't seem to be going away either. Again, ****ty culture getting imported from the worst country in the world, USA to us.

A good system should work good always. Like Germany. Why does Germany not have a housing bubble? Why do they have the most efficient economy? The most productive industry? The least unemployment in Europe? Their government simply knows how to make good regulation to create good and fair markets, and both sides of our government are brain-dead, corrupt tossers who don't care about anything but their own wealth, and the wealth of those who put money in their campaigns. Pathetic.



There was a very good point on Lateline business last night, companies should outsource management to countries like Germany or India where the job would be done far better at a fraction of the cost.

I for one agree with this, CEOs in Australia are complete morons who can't do anything, let alone expand their businesses into Asia. I think we need to outsource most of our companies' management to Germany, who will do a far better job without ridiculous bonuses.


----------



## wayneL (23 November 2011)

Worst country in the world USA! 

Please tell me you were merely using hyperbole to make some sort of point (which at this point remains obscure).

What is your point BTW?


----------



## moXJO (23 November 2011)

Starcraftmazter said:


> A good system should work good always. Like Germany. Why does Germany not have a housing bubble? Why do they have the most efficient economy? The most productive industry? The least unemployment in Europe? Their government simply knows how to make good regulation to create good and fair markets, and both sides of our government are brain-dead, corrupt tossers who don't care about anything but their own wealth, and the wealth of those who put money in their campaigns. Pathetic.
> 
> .




On the subject of Germany, out of East and West Germany which do your beliefs more align then tell me which one was better to live in and which one people were willing to die to get out of. 

A bit off topic but I believe it ties in with the socialist stance many want Here’s a comparison of east and west  Germany/economies and the effects that still last to this day.

http://econc10.bu.edu/economic_systems/Country_comparisons/East_West_Germany.htm

Also worth mentioning



> For the time being productivity levels and standards of living remain below that of Germany for the east. Since the West German economy is continually growing East Germany will have to align itself with a moving goal. This convergence is predicted to take another 30-40 years and is truly indicative of the differences in performance of the two countries since 1945. Central planning as it was implemented in East Germany did indeed satisfy policy goals and achieve a period of high extensive growth but in comparison with the west it failed to increase innovation and productivity to allow longer-term intensive growth. Without better ways to measure consumer desires, by having a more dynamic planning system in place, standards of living will remain higher in stable market economies.


----------



## Mrmagoo (23 November 2011)

Julia said:


> This post in no way answers my question about how you are going to measure "effort".
> Where is allowance for skill and capacity?




Those are made up words that don't exist.

Every worker is skilled, it is just a matter of how much they get paid.

I'm not going to gratify insanity and say that value = what you are paid.


----------



## So_Cynical (23 November 2011)

So_Cynical said:


> People wanting equality and a fairer world are whingers  i wonder what qualifications are required to be considered a DH?
> 
> The chart below is from what some would call a leftist site so i expect some *right wing whining*.






moXJO said:


> You clearly have that covered, perhaps over qualified




I just knew i could count on you for an expert opinion.



Julia said:


> Translation:  I want an equal share of the affluence in the world without having to exhibit any particular talent or capacity to earn that share.
> Whilst I wait for this great benevolence to land in my lap, I will relentlessly continue to whine about the unfairness of the world.




If the above is a true representation of your translation ability's...id stick to retirement if i was you.



Tyler Durden said:


> I wonder if these same people would whinge if they were on the wealthy end of the spectrum.




See this is the thing that gets me...if i had money what that hell could i realistically find to whinge about that's money related. :dunno: i was very happy this year to get a $2600 tax bill, and im rather hopeful that i can grow that tax bill every year....and if it comes to it i would be happy to have my tax bill capped along with my income.


----------



## young-gun (23 November 2011)

its inequality in us as beings that has led to such inequality throughout. it will not change.


----------



## Julia (23 November 2011)

Julia said:


> This post in no way answers my question about how you are going to measure "effort".
> Where is allowance for skill and capacity?





Mrmagoo said:


> Those are made up words that don't exist.



What???  You are actually suggesting that the words "effort", "skill" and "capacity" are made up words?  Without a clear definition?
Oh dear.



> Every worker is skilled, it is just a matter of how much they get paid.



What absolute rubbish. "Every worker is skilled"??? Give me a break!



So_Cynical said:


> If the above is a true representation of your translation ability's...id stick to retirement if i was you.



Well now, SC, I'd be more than happy to engage in a test of translation with you.
Would find it fun in fact.
For a start, I'd explain that it would be rare to find a possessive case of "ability", i.e. something belonging to ability.  The plural of "ability" is simply "abilities".  If you dropped a few of the inappropriate apostrophes your own interpretations of the posts of others would make more sense.

"if I was you"  :  try "if I were you".  
But hey, don't worry:  you're in the company of thousands.
(I rarely comment on grammar, spelling etc., but SC, if you decide to challenge me on 'translation', then I will do so.)

Seriously, your frequent reference to "them and us" is an illustration of the sort of silly class distinction that so pervades our society.   Go and read some of Tyson's posts.  He's a great example of someone who has determined to make his own place in the world via hard work and sheer doggedness.

He has undoubtedly taken calculated risks that others are unprepared to take, and given up short term gratification for the longer term benefits.  There are many more like him who - instead of whining about how disadvantaged they are - set out to change that. 



> See this is the thing that gets me...if i had money what that hell could i realistically find to whinge about that's money related. :dunno: i was very happy this year to get a $2600 tax bill, and im rather hopeful that i can grow that tax bill every year....and if it comes to it i would be happy to have my tax bill capped along with my income.



Congratulations on the tax bill.  I understand exactly what you're saying here.  Good for you.


----------



## Mrmagoo (23 November 2011)

Julia said:


> What???  You are actually suggesting that the words "effort", "skill" and "capacity" are made up words?  Without a clear definition?
> Oh dear.
> 
> 
> What absolute rubbish. "Every worker is skilled"??? Give me a break!




Effort is subjective and meaningless.
Skill is subjective.
Capacity can't be measured in this context.

Could I do my father's job ? No.

Could my father do my job. No.

Would others consider me more "skilled" because I have a degree, a job title and work in an office with a white collar ? Only the truly ignorant.

I know full well the physical endurance required would be something I'd need to develop. 

What we have is the slowly decaying remains of a class system with old voters and deluded youth clinging desperately to the last shreds through inventing psuedo scientific buzz words to try to justify their cause. This came to be known as the field of economics to which you refer.

One day the poor mans daughter will scold the rich mans daughter as she becomes the servant and the servant the master. Those days are here now and are more and more confirmed as a wave of educated generations sweeps across the corporate world.


----------



## IFocus (23 November 2011)

I like the US system where real wages haven't increased since 1990 unlike the top end of town.

How is that working out?

A working class poor pooled labour force what more could a nation ask for seems to be going gang busters at the moment in the US.

Should wealth distribution be equal?

Wealth distribution should be fair and to the advantage of the nations population to live healthy and meaning full lives.


----------



## Starcraftmazter (23 November 2011)

wayneL said:


> Worst country in the world USA!
> 
> Please tell me you were merely using hyperbole to make some sort of point (which at this point remains obscure).
> 
> What is your point BTW?




USA has every imaginable, conceivable, possible problem. It is by all counts a 3rd world country ran by corruption and more corruption. There has literally never been a worse country in the history of mankind, I would rather live in North Korea than there - at least NK doesn't have genetically modified food.

I'm not saying that USA didn't have a lot of good times in it's history, but the way it is now, it is literally the embodiment of everything wrong with the world and a perfect lesson on how not to run a country.


My point broadly speaking is that the government should take some action to move Australia closer to countries like Germany, where employees and unions have a much greater say in the remuneration (including bonuses) of executives.

If it were up to me, I would say executives are only allowed as much bonus as they give to each and every one of their employees (proportionally). It just doesn't seem fair otherwise.




moXJO said:


> On the subject of Germany, out of East and West Germany which do your beliefs more align then tell me which one was better to live in and which one people were willing to die to get out of.




There is only one Germany now. Sorry you missed the memo. I don't see what the divide between Germany in the last century post WW2 has anything to do with the subject matter being discussed.


----------



## wayneL (24 November 2011)

Starcraftmazter said:


> I would rather live in North Korea than there..




Lordy!!

Not sayin' the USA doesn't have problems, I don't like the direction it is heading either, this just told me everything I need to know about you.

Methinks you need a reality check my cognitively dissonant and ideologically conflicted friend.


----------



## basilio (24 November 2011)

The topic in question is really how wide a variation of income is "healthy" or "reasonable" in a society. Saw a good story in The Guardian which digs a bit deeper into the huge extremes of income in England.

The rest of the article explores how these huge disparities damage the remainder of the workforce.




> *Our anger over runaway top pay is more about merit than money*
> 
> In the UK 2,800 bankers earn over £1m. The claim that rare skills command a premium does not apply to them
> 
> ...




http://www.guardian.co.uk/commentisfree/2011/nov/22/objection-runaway-executive-pay-merit


----------



## Starcraftmazter (24 November 2011)

wayneL said:


> Lordy!!
> 
> Not sayin' the USA doesn't have problems, I don't like the direction it is heading either, this just told me everything I need to know about you.
> 
> Methinks you need a reality check my cognitively dissonant and ideologically conflicted friend.




Nothing to do with ideology, only political problems are ideology-related. Social, environmental, educational, health, etc problems have nothing to do with ideology.

USA is a country where a black man will go to jail for years for stealing a loaf of bread that they then return, whereas someone who steals billions of dollars from their clients or taxpayers faces zero repercussions.

USA is a *failed* state.


----------



## moXJO (24 November 2011)

So_Cynical said:


> I just knew i could count on you for an expert opinion.




Yes I’m an expert at pointing out the obvious





So_Cynical said:


> See this is the thing that gets me...if i had money what that hell could i realistically find to whinge about that's money related. :dunno: i was very happy this year to get a $2600 tax bill, and im rather hopeful that i can grow that tax bill every year....and if it comes to it i would be happy to have my tax bill capped along with my income.




Oh really? From a guy that plans to move to a cheaper country to exploit cheap labor and rates while dodging Aussie tax yet trading Aussie shares (was that the plan?)
And you can cap your tax bill and wages while giving back to society, it’s called giving to charity.





Starcraftmazter said:


> There is only one Germany now. Sorry you missed the memo. I don't see what the divide between Germany in the last century post WW2 has anything to do with the subject matter being discussed.




It’s a good example of a free market vs. (the shining beacon of a) socialist state. You seem hell bent on a North K system of brainwashed delusion.

As for wealth distribution



> The modernisation and integration of the eastern German economy is a long-term process scheduled to last until the year 2019, with annual transfers from west to east amounting to roughly $80 billion




Just to get the little old socialist paradise up to standard. So the effects of socialism lasts longer term.

A lot of aspects to Socialism is backwards (and yes it does have good aspects too), causes long term problems and given enough restrictions people are willing to risk death to get out of the country. 
 And while the US has a lot of problems I am yet to see Americans risking their lives floating on a piece of foam to get to Cuba.  I have friends that moved to the US who are very happy over there and would not move back here. 


Everyone points to other countries and mentions how we should be following them when things are not that bad here that drastic change is needed. More government meddling is the last thing we need.
Like I said I'm happy with more shareholder control then any form of government control.


----------



## wayneL (24 November 2011)

Starcraftmazter said:


> Nothing to do with ideology, only political problems are ideology-related. Social, environmental, educational, health, etc problems have nothing to do with ideology.
> 
> USA is a country where a black man will go to jail for years for stealing a loaf of bread that they then return, whereas someone who steals billions of dollars from their clients or taxpayers faces zero repercussions.
> 
> USA is a *failed* state.




Not that different to Australia then, or lots of other countries...

...and North Korea is of course an outstanding success story, the envy of the west.

The comedic value of your latest posts is outstanding. :


----------



## Timmy (24 November 2011)

Starcraftmazter said:


> I would rather live in North Korea than there




Big call. I'm assuming you haven't lived under a communist dictatorship?



Starcraftmazter said:


> - at least NK doesn't have genetically modified food.



Well, thats one way of putting it.

*Refugees flee famine ravaging North Korea.*
http://www.smh.com.au/world/refugees-flee-famine-ravaging-north-korea-20110717-1hk2a.html


> The United Nations World Food Program says North Korea faces its worst food shortage in a decade, with 6 million people at risk and the regime is unwilling to spend its dwindling hard currency reserves on buying food for its population of 24 million..


----------



## sptrawler (24 November 2011)

Timmy said:


> Big call. I'm assuming you haven't lived under a communist dictatorship




We are ptetty close with Julia, she doesn't listen to anyone and blindly proceeds with her own agenda.Well allmost, lucky we have Bob to keep her in check.LOL

As for wealth being distributed equaly, it is to a degree, that is where means testing and tax brackets come in. This has to be balanced with the objective of ensuring the welfare state doesn't encourage everyone to give up working.
As Churchill put it. Socialism is a philosophy of failure, the creed of ignorance and the gospel of envy, its inherent virtue is the equal sharing of misery.
That is because socialism drives everything down to the lowest common denominator.


----------



## Starcraftmazter (25 November 2011)

moXJO said:


> It’s a good example of a free market vs. (the shining beacon of a) socialist state.




Not really. Australia is more socialist that East Germany was.



moXJO said:


> You seem hell bent on a North K system of brainwashed delusion.




Yes, let's just make arbitrary and unfounded. statements.



wayneL said:


> Not that different to Australia then, or lots of other countries...




Australia sure is bad, but USA is far far worse. At least here many substances allowed for human consumption in USA are banned.



wayneL said:


> ...and North Korea is of course an outstanding success story, the envy of the west.




The point is, even as bad as NK is, it is not as bad as USA. You seem to fail grasping this point.



Timmy said:


> Big call. I'm assuming you haven't lived under a communist dictatorship?




I fail to see anything communist about NK.



Timmy said:


> Well, thats one way of putting it.




Better to have a shortage of food than poison food.


----------



## wayneL (25 November 2011)

LOL comedy gold Stars!


----------



## prawn_86 (25 November 2011)

Back on topic;

I do think that CEO salaries have risen disproportionately to other salaries, especially since unemployemnt levels etc have also increased. Sure corporate profits have increased, but that only benefits the owners of these companies, and they have not increased as much as CEO salaries (go figure).

But, in the Western lifestyle we are still too comfortable to actually revolt and rise up against the current governments


----------



## Gringotts Bank (11 October 2013)

http://www.smh.com.au/federal-polit...ns-share-of-income-growth-20131009-2v8q2.html

Have a read.  The Scandanavian countries  seem to have almost a communist approach to wealth distribution.  France and Switzerland sort of moving that way a little bit.

The really interesting thing is that these very same countries are some of the most progressive in the World in terms of national health (and health care), happiness, technology uptake, employment and political stability. 
Compare to the US where things are in great decline on most of these measures.  Maybe Obamacare will get passed, who knows?

Also, what is it about Scandanavian capital cities and hot women?  Been watching Dexpedition over the past few months and the number of stunners was very high compared to other Euro cities.


----------



## sydboy007 (12 October 2013)

Would it not be better to look at the issue more along the lines of ensuring everyone has equal opportunities in life.

Australia is far better in this respect than the USA, but a lot of European countries seem to do this better than us.  Australia long ago moved from being particularly egalitarian , even if we still love to cut down the tall (non sporting) poppies.

I will say at least in Australia if you grow up in a low income household you have far far better prospects than the USA.  I know my escape from the poverty cycle would have been very difficult to achieve in the USA, what with massive student loans to get through college, and the far lower basic wage in the service industry when you're trying to earn some $$$ while at uni.

But when you look at how our political society is fracturing, I'm not sure how much longer it will occur.  People already tailor a lot of their media consumption so as to listen / read only from sources they agree with.  Comforting but not particularly informative if you only ever have your biases reinforced.

Why is white collar crime so poorly punished when compared to say a physical robbery?  Why do we have such poor whistle blower laws in the country where corruption could be exposed but for now seems to be swept under the carpet?  It feels like a plutocracy where the law of the land is mainly to protect the rich and ensure punishment of the poor.

Income / asset distribution will always been unequal, purely because some people have the drive and the passion to accumulate a lot of this, others will be happy with less because they put their efforts into other pursuits.  What I want is for all of us to have the opportunities to go in which ever direction we determine is best for ourselves.  What I don't what is to have to pay more tax than I currently do so that it can be redistributed at the whim of the current Government for whatever hair brained purpose they want - think Abbotts terrorism 75K payout for injury  

Surely we could better fund public schools to keep them from falling further behind the private sector.  Surely we can make sure anyone with the acumen and drive can get through university or TAFE and not have the upfront fees be a barrier to talent.

just my


----------



## Tisme (1 November 2017)

Disgraceful how the UK doesn't look after its migrants:

http://worldstory.co/family-of-10-o...nd-for-government-on-what-theyre-entitled-to/


----------



## SirRumpole (1 November 2017)

Tisme said:


> Disgraceful how the UK doesn't look after its migrants:
> 
> http://worldstory.co/family-of-10-o...nd-for-government-on-what-theyre-entitled-to/




Maybe they could use Buck Palace when HM is at Sandringham.


----------



## basilio (6 November 2017)

Maybe the question should be:

*"How do we  ensure the uber rich pay their fair share of taxes to help a fairer society ?"*

Check out the Pardise papers expose ( Just like the Panama Papers really..)

* Paradise Papers leak reveals secrets of the world elite's hidden wealth *
Files from offshore law firm show financial dealings of the Queen, big multinationals and members of Donald Trump’s cabinet


2:07
What are the Paradise Papers? – video

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Juliette Garside
Sunday 5 November 2017 20.36 GMT   First published on Sunday 5 November 2017 18.00 GMT

The world’s biggest businesses, heads of state and global figures in politics, entertainment and sport who have sheltered their wealth in secretive tax havens are being revealed this week in a major new investigation into Britain’s offshore empires.

The details come from a leak of 13.4m files that expose the global environments in which tax abuses can thrive – and the complex and seemingly artificial ways the wealthiest corporations can legally protect their wealth.

The material, which has come from two offshore service providers and the company registries of 19 tax havens, was obtained by the German newspaper Süddeutsche Zeitung and shared by the International Consortium of Investigative Journalists with partners including the Guardian, the BBC and the New York Times.

https://www.theguardian.com/news/20...reveals-secrets-of-world-elites-hidden-wealth


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## basilio (6 November 2017)

For those who, on principle,  can't read news printed in The Guardian feel free to check out the Paradise Papers at  News Ltd.

*Paradise Papers leak exposes the tax secrets of the world’s super rich*
SOME huge names have been exposed in a leak of 13 million files, which has revealed the rich and famous's favourite tax tricks.

Liz Burke, AFP and AAP
news.com.auNovember 6, 20179:32am

Video
Image
*Queen implicated in 'Paradise Papers'*









THE biggest leak in history, the Paradise Papers, is more than a giant dump of documents with a 007-worthy name.

Containing more than 13 million files from offshore tax haven providers, the leak exposes rampant tax avoidance by major companies, politicians, royalty, and rock stars who have been investing in notorious tax havens including the Cayman Islands and Bermuda.

Perhaps most alarmingly, it exposes financial ties between the highest levels of the Trump administration and associates of Russian President Vladimir Putin.

The papers were obtained by the German newspaper _Sueddeutsche Zeitung _and were shared with the International Consortium of Investigative Journalists (ICIJ), which includes ABC’s _Four Corners_.

The names of more than 120 politicians in nearly 50 countries appear in the 1.4 terabyte data leak, along with figures from the worlds of sports and business.

The documents show that US Commerce Secretary Wilbur Ross, the Trump administration’s point man on trade and manufacturing policy, has a stake in a company that does business with a gas producer partly owned by the son-in-law of Russian President Vladimir Putin.

According to the ICIJ, Ross is an investor in Navigator Holdings, a shipping giant that counts Russian gas and petrochemical producer SIBUR among its major customers.

Putin’s son-in-law Kirill Shamalov once owned more than 20 per cent of the company, but now holds a much smaller stake.

http://www.news.com.au/finance/econ...h/news-story/e1571f5ffd36f74e78c0d770fcf133da


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## SirRumpole (6 November 2017)

basilio said:


> For those who, on principle,  can't read news printed in The Guardian feel free to check out the Paradise Papers at  News Ltd.
> 
> *Paradise Papers leak exposes the tax secrets of the world’s super rich*




Might get some people to watch Four Corners too.


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## qldfrog (6 November 2017)

basilio said:


> The documents show that US Commerce Secretary Wilbur Ross, the Trump administration’s point man on trade and manufacturing policy, has a stake in a company that does business with a gas producer partly owned by the son-in-law of Russian President Vladimir Putin.



so that is enough to build a conspiracy Basilio?, seriously, anything can do: a pizza parlor sex ring a la Hilary next?
But very good thing that these papers get released; the electorate has to understand the level of corruption and the way the taxes and the laws actually differ when you belong to the 0.01 %;
Any Clinton or Obama link BTW?
While the right by tradition is wealthier, and so more often exposed, one would be fool top belive the left is pure as has been shown again and again with the Socialist elite in Europe;
Trump and One Nation like parties will benefit, and with good reason.
I would just ask you to do a simple thing if you are above 40:
how rich would you be now if your tax rate had been in the high teen at the most? the difference is stunning, and this is the way it works for the elite.no wonder wealth get more and more concentrated


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## basilio (6 November 2017)

I don't think I was trying to build a "conspiracy" re  Wilber Ross. This was just one part of many thousands of documents of these papers.

I suggest the concern with US Commerce Secretary Wilber Ross is the direct financial benefit he gains from policy he makes in dealing with Russian gas producers. I believe that could be  considered financial emoulment.  That is probably the red flag the Trump administration.

There is a more detailed analysis of Commerce Secretary Wilber Ross's financial dealings with Russian companies in another story.

https://www.theguardian.com/news/20...s-business-links-putin-family-paradise-papers

http://www.investopedia.com/terms/e/emolument.asp

How wide will this net be cast ?  I'd be certain that Republician politicians would be scouring the documents for dirt on Democrat politicians.  Lets see how lucky they are..!


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## qldfrog (6 November 2017)

basilio said:


> I don't think I was trying to build a "conspiracy" re  Wilber Ross. This was just one part of many thousands of documents of these papers.
> -> OK
> How wide will this net be cast ?  I'd be certain that Republician politicians would be scouring the documents for dirt on Democrat politicians.  Lets see how lucky they are..!



statically far less as the Left usually sucks money directly from government as they are bad at business.
think RE corruption, gifts, golden handshake and priviledge for the family


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## SirRumpole (6 November 2017)

qldfrog said:


> statically far less as the Left usually sucks money directly from government as they are bad at business.
> think RE corruption, gifts, golden handshake and priviledge for the family




Surely you jest ? 

I'd rather be a company director sucking money off shareholders, government and the general public rather than a union official trying to make a dishonest living from workers.


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## qldfrog (7 November 2017)

SirRumpole said:


> Surely you jest ?
> 
> I'd rather be a company director sucking money off shareholders, government and the general public rather than a union official trying to make a dishonest living from workers.



not that it prevents them to do it!!!!thompson...wasn't it; the nurse union, and you can line them..but I am also thinking workplace relation lawyer, or cushy ONG for our Julia G.
Or mining lease rort in NSW 
anyway SirRumpole your mind is set


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## SirRumpole (7 November 2017)

qldfrog said:


> anyway SirRumpole your mind is set




How so ? Thompson was a dope and so is Kathy Jackson and I'm sure there are more like them in the union movement, but there would be a lot more in the business area who regard an unlimited credit card as a perk of the job, and prostitutes et al as simply winding down after the hard decisions like say sacking 4,000 people.


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## qldfrog (8 November 2017)

SirRumpole said:


> How so ? Thompson was a dope and so is Kathy Jackson and I'm sure there are more like them in the union movement, but there would be a lot more in the business area who regard an unlimited credit card as a perk of the job, and prostitutes et al as simply winding down after the hard decisions like say sacking 4,000 people.



sure but in a real capitalist free system, I would not have to put 9.5% of my income in a super fund who insvest in these;
most of private businesses in australia are not publicly listed companies, and if their owners want to spend their money on whoring, let it be;
What you point at is that we are in a mixed system where unions are mandatory for many AND capitalism is twisted into a cronies paradise at all levels due to government regulations and rulings with no individual freedom left as to how to spend your money:
taxes, super, rates, water and power bills unrelated to actual usage, mandatory insurances (so far all government mandated) so in the pure 1984 idea, brainless minions are managed by a nanny state, told to consume/reproduce while the 0.01%(if that...) are cashing on and living the dream; 
Not that far from USSR in the 70s actually;
But minions need to vent their frustration if they are low on Voltaren so let's have a left/right debate!

Only in a 1984 world can a question like "should wealth distribution be equal?" be raised.
Seriously? and I should be a math genius and a marathon winner? too many participation awards in primary schools leads to that thinking;
Should opportunities for wealth be equal? Yes we can aim for that.But if you are born with an IQ of 50, these opportunities are not going to equal, and if they are made equal with the "positive discrimination", this is another nightmare future;
I have a life to lead so enough for today; I actually wouldn't mind meeting you for a chat one day SirRumpole, would be interesting.Have all a great day


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## SirRumpole (8 November 2017)

qldfrog said:


> Should opportunities for wealth be equal? Yes we can aim for that.But if you are born with an IQ of 50, these opportunities are not going to equal, and if they are made equal with the "positive discrimination", this is another nightmare future;




Sure I agree with that, wealth distribution is never going to be "equal", but what I'm saying is that wealth concentration is bad for the economy because the economy depends on as many consumers as possible having the discretionary spending ability to buy the goods and services that business produces. 

In other words 10 people earning $50,000k is better than one person earning $500k because once that one person has their needs and wants satisfied they won't spend much of any extra they get in the local economy. They might buy a new Mercedes or go on an overseas trip, but that's not much help to our economy whereas the 10 people will spend in local businesses and keep the economy going.


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## Value Collector (8 November 2017)

SirRumpole said:


> Sure I agree with that, wealth distribution is never going to be "equal", but what I'm saying is that wealth concentration is bad for the economy because the economy depends on as many consumers as possible having the discretionary spending ability to buy the goods and services that business produces.
> 
> In other words 10 people earning $50,000k is better than one person earning $500k because once that one person has their needs and wants satisfied they won't spend much of any extra they get in the local economy. They might buy a new Mercedes or go on an overseas trip, but that's not much help to our economy whereas the 10 people will spend in local businesses and keep the economy going.




You are mixing up Capital and Income there.

When some one is talking about "Wealth concentration", they are talking about the ownership interest is the economy being concentrated among a smaller group of people, they are the owners/investors.

The production/income of that capital/ownership interest gets divided between three groups 

1, employees and suppliers 
2, the government (taxes) 
3, Owners (dividends)

How that pie is cut up will always be debated, Unions fight to get the employees a larger piece, the government always wants their cut, and owners want a decent return on our capital.

Over time employees are very slowly being phased out and reduced, and production is becoming more capital intensive, its important for "employees" to seek to become "owners", other wise they are going to have to rely on group 2, the government.


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## SirRumpole (8 November 2017)

Value Collector said:


> Over time employees are very slowly being phased out and reduced, and production is becoming more capital intensive, its important for "employees" to seek to become "owners", other wise they are going to have to rely on group 2, the government.




So how are "phased out" employees going to afford to become "owners" on the dole ?


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## Value Collector (8 November 2017)

qldfrog said:


> sure but in a real capitalist free system, I would not have to put 9.5% of my income in a super fund who insvest in these;





Unfortunately most employees would not willingly allocate part of their earnings to become owners, So we have to force them to through super.

Super is a way of forcing the average Joe to invest.


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## Value Collector (8 November 2017)

SirRumpole said:


> So how are "phased out" employees going to afford to become "owners" on the dole ?




Add value to the economy in a way that robots can't yet, there will never be a total phasing out of humans.

But I think eventually the "dole" will transform into a different thing, like a minimum payment everyone gets, and you can start by just investing a few dollars a week.

It took me a year to save for my first parcel of shares.


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## SirRumpole (8 November 2017)

Value Collector said:


> But I think eventually the "dole" will transform into a different thing, like a minimum payment everyone gets, and you can start by just investing a few dollars a week.




Yes, I can see a minimum payment coming, but what is the income source for that ?


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## Value Collector (8 November 2017)

SirRumpole said:


> Yes, I can see a minimum payment coming, but what is the income source for that ?




Taxes and maybe lower prices


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## SirRumpole (8 November 2017)

Value Collector said:


> Taxes and maybe lower prices




Well the phased out employees won't have the money to pay taxes so it has to be from business right ?


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## Value Collector (8 November 2017)

SirRumpole said:


> Well the phased out employees won't have the money to pay taxes so it has to be from business right ?




Yeah, it wold be a combination of all the usual taxes e.g Company tax, personal tax, Mineral and Resources tax, capital gains tax, various excises and duties etc etc its quite a long list.

But as Automation takes over, Productivity will rise, So the economy will be producing more and more goods and services, even as the labour content reduces.

So the total pie will be growing, its just how we cut it up that will change.

Less of the Pie will be going to unskilled or low skilled labour, So there will be more pie available for taxes, while also allowing the investors to earn a decent return on their invested capital.

Some of the extra productivity will be passed on to society in the form of lower prices, its not all about giving people more dollars, reducing prices of the goods and services they consume increases living standards also.

But yeah it will be a slow process, and peoples best bet is to start investing today. It is not about owners vs workers, Everybody should be trying to be both, and with compulsory super they are forced to but they should do more also.


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## tech/a (8 November 2017)

Should wealth distribution be equal?

Of course not.
If it were Id be an ordinary duck!


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## qldfrog (8 November 2017)

SirRumpole said:


> Yes, I can see a minimum payment coming, but what is the income source for that ?



taxing anyone still in the middle class until average mediocrity is reached...aka my own birth country , ultra richs are obviously immune, and worthwhile individuals (gifted or hard worker) leave while parasites come to join the feast.universal income, my nightmare and an utopia in a borderless world


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## SirRumpole (8 November 2017)

qldfrog said:


> taxing anyone still in the middle class until average mediocrity is reached...aka my own birth country , ultra richs are obviously immune, and worthwhile individuals (gifted or hard worker) leave while parasites come to join the feast.universal income, my nightmare and an utopia in a borderless world




I doubt if taxing individuals and then giving the money back to them in the form of a minimum payment would be effective. If productivity increases due to technology it will be businesses who have the money so they are the most likely target.


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## moXJO (8 November 2017)

SirRumpole said:


> Yes, I can see a minimum payment coming, but what is the income source for that ?






SirRumpole said:


> Well the phased out employees won't have the money to pay taxes so it has to be from business right ?




These are good questions.
I heard they were looking at taxing the robots on their production, so business couldn't offshore profits.
With soon to come robots, cryptocurrency and other revenue headaches. I sure hope someone is planning it out.


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## PZ99 (8 November 2017)

I reckon we sell Christmas Island to Uncle Sam for 2 trillion (before the Chinese steal it) store that money in a future fund and use some of its earnings to fund a minimum payment.

Too easy


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## Value Collector (9 November 2017)

SirRumpole said:


> I doubt if taxing individuals and then giving the money back to them in the form of a minimum payment would be effective. If productivity increases due to technology it will be businesses who have the money so they are the most likely target.




Businesses are owned by investors, and investors are people, So personal taxes will still exist, 67% of the profits made by companies on the asx get paid out to share holders in dividends, and flow through to their personal income taxes.

It's not about Business vs Individuals. Business profits eventually pass through to individuals, and are taxed at that level.


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## Value Collector (9 November 2017)

moXJO said:


> .
> I heard they were looking at taxing the robots on their production,





Why would you have to do that? You can just tax the total profits at the company and investor level.

Machines having been used for years to increase productivity and reduce labour, when farms gradually switched from harvesting by hand to harvesting with combine harvesters we didn't have to start taxing combine harvesters, other types of automation are no different.


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## SirRumpole (9 November 2017)

Value Collector said:


> It's not about Business vs Individuals. Business profits eventually pass through to individuals, and are taxed at that level.




If the profits pass to overseas investors then they don't get invested back into our economy and should be taxed at a higher rate to encourage re-investment in this country.


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## Value Collector (9 November 2017)

SirRumpole said:


> If the profits pass to overseas investors then they don't get invested back into our economy and should be taxed at a higher rate to encourage re-investment in this country.




"Encourage *Reinvestment" * that might discourage the initial investment


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## qldfrog (9 November 2017)

SirRumpole said:


> I doubt if taxing individuals and then giving the money back to them in the form of a minimum payment would be effective. If productivity increases due to technology it will be businesses who have the money so they are the most likely target.



why should it be effective?
does the government cares? a government just wants to be reelected so blame the richs, massage the lobbies to ensure your future should you loose the next election or decide to leave
if you tax businesses-> they move away, only people (who are unwilling /unable to migrate) and land assets can be taxed so that is the way it will go.it would be very interesting for you guys to have an in depth study of France, its policies/government and slogan, and tax regime: land/assets/death duties/etc and resulting business failure/success in the last 30y. we are following that "model" very closely for the last 25 y, with a 30y or so delay.I do not expect any different result


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## moXJO (9 November 2017)

Value Collector said:


> Why would you have to do that? You can just tax the total profits at the company and investor level.
> 
> Machines having been used for years to increase productivity and reduce labour, when farms gradually switched from harvesting by hand to harvesting with combine harvesters we didn't have to start taxing combine harvesters, other types of automation are no different.



Like how apple and google pay tax here? 
You can structure to pay less tax here.


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## SirRumpole (9 November 2017)

qldfrog said:


> why should it be effective?
> does the government cares? a government just wants to be reelected so blame the richs, massage the lobbies to ensure your future should you loose the next election or decide to leave
> if you tax businesses-> they move away, only people (who are unwilling /unable to migrate) and land assets can be taxed so that is the way it will go.it would be very interesting for you guys to have an in depth study of France, its policies/government and slogan, and tax regime: land/assets/death duties/etc and resulting business failure/success in the last 30y. we are following that "model" very closely for the last 25 y, with a 30y or so delay.I do not expect any different result




France is a part of the Disneyland called the EU, massive subsidies and public debt and they are heading for a fall pretty soon. 

We don't have the luxury of having trading partners supporting a lavish lifestyle, but we have a market that business people want to sell to and to do that they need consumers with money to spend. That's what a lot of businesses don't want to admit, it's not all about them, they can produce whatever they want but if they can't sell it because the consumers have no money they are stuffed.


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## Value Collector (10 November 2017)

moXJO said:


> Like how apple and google pay tax here?
> You can structure to pay less tax here.



By all mean plug loop holes, and charge tax.

I am just against any form of "punitive" taxes, just setup a system where tax is paid at fair rates, and companies can avoid double taxation.



> That's what a lot of businesses don't want to admit, it's not all about them, they can produce whatever they want but if they can't sell it because the consumers have no money they are stuffed




Simply put, business is just about exchanging the things you produce for stuff you want to consume.

It's about the producers of goods and services trading with other producers of goods and services, money is just the unit of account we use. You don't actually need the unproductive members of society, to the point that we are forced to feed them via taxation, we need to sell to them just to earn our tax dollars back, but we could survive if not thrive without them.


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## SirRumpole (10 November 2017)

Value Collector said:


> You don't actually need the unproductive members of society, to the point that we are forced to feed them via taxation, we need to sell to them just to earn our tax dollars back, but we could survive if not thrive without them.




I disagree. Children and pensioners are "un productive" but they still spend money whether on their own on on their behalf and buy goods and services and therefore give income to business. In any case you are not going to get rid of them so you just have to accept that they are part of the economy and whole business are geared around providing for their needs.


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## Value Collector (10 November 2017)

SirRumpole said:


> I disagree. Children and pensioners are "un productive" but they still spend money whether on their own on on their behalf and buy goods and services and therefore give income to business.




They spend money which we give them, if we weren't force to give them money we wouldn't need to share our production with them.

if the unproductive didn't exist, the people who produce all the goods and services would as a group have more goods and services to trade with each other.

Think of it like this.

I have to give 30% of my production in tax, some of this is used to produce services which I benefit from, however some of it is used to maintain the unproductive groups, who then use my money to compete with me for the products and services in the market I wish to buy, so they not only take from me directly, but also force prices up of the things I wish to buy.


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## SirRumpole (10 November 2017)

Value Collector said:


> if the unproductive didn't exist, the people who produce all the goods and services would as a group have more goods and services to trade with each other.




But they do exist, and unless you are suggesting shipping them elsewhere then I'd say you just have to put up with it.


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## Value Collector (10 November 2017)

SirRumpole said:


> But they do exist, and unless you are suggesting shipping them elsewhere then I'd say you just have to put up with it.




Yes, and as I have said I feel we have a moral obligation to share our production with those that have gotten the short straw, I am not saying we shouldn't share, I am simply saying there is not economic need, you seemed to be suggesting we rely on them, but its the opposite, they rely on us, in the absence of the moral obligation and the government forcing it, we would be fine, they would starve.


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## SirRumpole (10 November 2017)

Value Collector said:


> Yes, and as I have said I feel we have a moral obligation to share our production with those that have gotten the short straw, I am not saying we shouldn't share, I am simply saying there is not economic need, you seemed to be suggesting we rely on them, but its the opposite, they rely on us, in the absence of the moral obligation and the government forcing it, we would be fine, they would starve.




Well exactly who are you talking about when you say "unproductive" ? The unemployed ? Pensioners ? Children ? What groups are you targetting ?

And in fact, if your main occupation is sitting around buying and selling bits of paper then I'd suggest that that is pretty unproductive as well.


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## Value Collector (10 November 2017)

SirRumpole said:


> Well exactly who are you talking about when you say "unproductive" ? The unemployed ? Pensioners ? Children ? What groups are you targetting ?




Any group that is not engaged in using their Capital or Labour in producing a product or service. e.g. any group that relies on a hand out, and consumes without putting anything back into to the economy to produce.



> And in fact, if your main occupation is sitting around buying and selling bits of paper then I'd suggest that that is pretty unproductive as well.




Investors, own the capital assets of the economy, their capital is essential to the economy.

but if you are talking about day traders, well I kind of agree with you, however I guessing they are helping to facilitate the market, so are some what useful.

---------------------------------------

Take a look at this short video, look at the scale of the infrastructure built with the funds of private investors, Fortescue produces Billions of dollars in value that it pays to staff, taxes and investors.

Without the investors buying all the trucks, dozers, plant, ships and building the railways and ports, the staff wouldn't be able to produce anything, So investors capital is key to productivity.


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## SirRumpole (10 November 2017)

Value Collector said:


> Without the investors buying all the trucks, dozers, plant, ships and building the railways and ports, the staff wouldn't be able to produce anything, So investors capital is key to productivity.




Sure, but investors don't need to be individuals directly, they can be pension funds like superannuation companies or the Future Fund.

I'm getting a return on MY money invested through my super fund even though I'm retired and could be said to be non productive now, but it's still my money that is invested in the super fund, and I consume as well so I'm buying stuff that business produces and helping them stay in business. I'm simply getting a return on my capital like any other investor.


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## Value Collector (10 November 2017)

SirRumpole said:


> I'm getting a return on MY money invested through my super fund even though I'm retired and could be said to be non productive now, but it's still my money that is invested in the super fund, I'm simply getting a return on my capital like any other investor.




Yeah, if you are living off your super investments, you are an investor, I wouldn't class you as unproductive.

Some people are 50/50 because they get a partial pension and other subsidies, while living of some of their own capital earnings.

Some people are 100% unproductive.

A fully self funded retiree living of savings and investment earnings, is not unproductive.




> and I consume as well so I'm buying stuff that business produces and helping them stay in business.




The businesses you own (indirectly through your super), are producing products and services and selling them into the market, contributing to the economy.

The company then has cash in its hand, which it then pays to

1, staff and suppliers (productive group)
2, Taxes (productive and unproductive groups)
3, investors (productive group)

Those three groups then use that cash to go and bid for products and services in the market.

The unproductive groups aren't adding to the economy by spending, they are taking goods and services without contributing to their production, Sure a business owner might be happy when a pensioner spends money at his store, but as a group the business owners and staff would be better off if they didn't have to pay out the additional tax dollars to the pensioner to start with.


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## SirRumpole (10 November 2017)

> but as a group the business owners and staff would be better off if they didn't have to pay out the additional tax dollars to the pensioner to start with.




I doubt whether a pensioner, assuming they have been working most of their adult lives and paying taxes, would ever receive a return on those taxes via benefits that they received when they were working.

So pensions could theoretically be viewed as a return on capital (their money paid to the government via taxes).

So I guess if you agree (as you did previously) that a minimum payment may be necessary in the future then the pension is part of that.


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## Value Collector (10 November 2017)

SirRumpole said:


> I doubt whether a pensioner, assuming they have been working most of their adult lives and paying taxes, would ever receive a return on those taxes via benefits that they received when they were working.




All the taxes that they paid over their lives have been spent as they paid them, Once you deducted all the government spending they benefited from e.g. their schooling, Health care, police, roads, family benefits etc etc, any small remaining amount of excess value they have contributed would be eaten very fast when you factor in 20 years of pension and health care.

The kids joining the work force today inherit government debt, there is no savings account left by the government of their grand parents generation from which their grandparents are drawing on.




> So I guess if you agree (as you did previously) that a minimum payment may be necessary in the future then the pension is part of that.




Yeah, my argument was simply that from an economic stand point we don't "need" any of the unproductive people, and they should be grateful for the support they get, not thinking that they are doing us a favour by spending the money that was picked from our pocket to begin with.

So to wrap up, Morally I am happy to give a portion of my production to the unproductive, especially those that genuinely got short straws, But there is no economic need.


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## SirRumpole (10 November 2017)

Some very interesting comments from an investment banker Matt Sherwood of Perpetual:-



> *Personal tax cuts may be more effective*
> The head of strategy at investment house Perpetual, Matt Sherwood, also thinks the Business Council is barking up the wrong tree on company tax.
> 
> Mr Sherwood says the BCA approach betrays a lack of understanding of what drives investment.
> ...




[my bolds and italics]

http://www.abc.net.au/news/2017-11-...pport-big-business-case-for-a-tax-cut/9133630


It's what I've been saying all along, consumers run the economy, not investors.


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## Value Collector (10 November 2017)

> Mr Sherwood says a cut to company tax, in the current economic environment, will only result in higher dividends to shareholders, with nothing for workers in the shape of jobs or higher wages, and no increase in investment.




Increased dividends would mean two things happen.

1, More disposable income for people and charities who rely on dividends, which would stimulate many small businesses located all around Australia.

2, People not living off their dividends would seek to invest them, which would either directly or indirectly cause more funds to be available to the areas that do need fresh investment capital.


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## notting (10 November 2017)

Following the Republican aspirations in Australia?  Maybe not such a good idea -



What happens with tax at present anyway -


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## SirRumpole (10 November 2017)

Onya Bernie !


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## moXJO (10 November 2017)

Value Collector said:


> By all mean plug loop holes, and charge tax.
> 
> I am just against any form of "punitive" taxes, just setup a system where tax is paid at fair rates, and companies can avoid double taxation.
> 
> ...



I'm pro business,  but not pro revenue rape. Loopholes will definitely need tightening.
I agree with the rest of it.


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## Value Collector (11 November 2017)

moXJO said:


> I'm pro business,  but not pro revenue rape. Loopholes will definitely need tightening.
> I agree with the rest of it.




We need global tax reform, But I have no Idea how that can happen.

Global Businesses need to structure their affairs in ways to protect them selves from double and triple taxation, this causes them to employ tax experts that get paid to set up the most tax efficient structure possible, normally resulting cutting out or paying only token payments in some regions.

If there was a global tax system that allowed the total tax paid to be limited to about 30%, less companies would be seeking out tax havens, but if countries choose to have laws that result in multiple countries charging tax on the same profits, companies need to protect themselves.


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## SirRumpole (11 November 2017)

Value Collector said:


> Any group that is not engaged in using their Capital or Labour in producing a product or service. e.g. any group that relies on a hand out, and consumes without putting anything back into to the economy to produce.
> 
> Investors, own the capital assets of the economy, their capital is essential to the economy.




It should be said though that unless you buy newly issued shares you are not a productive investor because you are not contributing any capital to the company, buying already issued shares is just like buying a second car, it contributes nothing to production.


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## SirRumpole (11 November 2017)

SirRumpole said:


> just like buying a second car, it contributes nothing to production.




Make that a second *hand* car.


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## notting (11 November 2017)

SirRumpole said:


> Make that a second *hand* car.



Yeah but not quite.
Because who ever you bought the shares from may spend that money on something that contributes to productivity.
It seems now we are being challenged to create sustainable and economic models rather than this mad 'growth only pyramid system' which is destroying the very environment that allows life at all!
I have never seen a weather map showing three cyclones all lined up in a row and heading for Florida like what happened this year.  It will probably happen again next year too.
There are tough times ahead!  I tell you this.


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## brty (11 November 2017)

SirRumpole said:


> It should be said though that unless you buy newly issued shares you are not a productive investor because you are not contributing any capital to the company, buying already issued shares is just like buying a second car, it contributes nothing to production.




Sir Rumpole, I have often thought that, but a small explorer actually needs the traders to drive up the price before it can go to the market for funds for development. I tend to agree that most trading is non productive, just numbers on paper (or in computers), often just a transfer of wealth from those that don't know what they are doing to those that do.
Sandfire and like good stories are the types of shares that need traders, or the dilution to build the mine would have been massive.
Despite the non-productive nature of most trading, it is still a necessary step to raise prices of some companies.


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## SirRumpole (11 November 2017)

brty said:


> but a small explorer actually needs the traders to drive up the price before it can go to the market for funds for development.




And a lot of the time prices rises are based on hope and speculation that comes to nothing and investors lose their money.


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## bellenuit (11 November 2017)

You all seem to be missing the significance of the secondary market for shares. Without it there would be no (or a negligible) primary market and hence new or expanding companies would be limited in their sources of funds. Few people would be willing to subscribe to an IPO or subsequent share offerings by a company if they have no means of liquidating that investment other than through private sales. It is like buying shares in a private placement of an unlisted company. You are locked in to that investment until the company either lists or there is some other buyer willing to buy your holding. It is knowing there is a ready secondary market available for your shares that makes primary share purchases attractive.


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## SirRumpole (11 November 2017)

bellenuit said:


> You all seem to be missing the significance of the secondary market for shares. Without it there would be no (or a negligible) primary market and hence new or expanding companies would be limited in their sources of funds. Few people would be willing to subscribe to an IPO or subsequent share offerings by a company if they have no means of liquidating that investment other than through private sales. It is like buying shares in a private placement of an unlisted company. You are locked in to that investment until the company either lists or there is some other buyer willing to buy your holding. It is knowing there is a ready secondary market available for your shares that makes primary share purchases attractive.




All very true. The current  discussion revolved around one posters definition of "un productive", which I really think is irrelevant as the economy is made of of a variety of consumers, investors, companies, governments and their regulations and other businesses that all contribute to the whole. I guess if people want to start discriminating between those inputs that they consider productive and others that they think are drags then there will be arguments about that. Just as we can't eliminate drag on aircraft we can't do it for the economy either so there isn't really any point making that distinction as I pointed out earlier.


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## brty (11 November 2017)

One aspect I brought up around 10 years ago on this forum was the difference I see between investing and trading. Investing is giving the company money, or starting a business etc, while trading is the secondary market, even though most call buying stocks on the market investing.
I think the terminology often confuses people.
Both are obviously needed, despite people often losing in the speculative end of the market (and the so called blue chips for that matter), simply because they are trading when they think they are investing, and basically don't know the difference, nor know how to do either.


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## luutzu (11 November 2017)

basilio said:


> For those who, on principle,  can't read news printed in The Guardian feel free to check out the Paradise Papers at  News Ltd.
> 
> *Paradise Papers leak exposes the tax secrets of the world’s super rich*
> SOME huge names have been exposed in a leak of 13 million files, which has revealed the rich and famous's favourite tax tricks.
> ...




As the late, and great, George Carlin said: It's a big club, and you ain't in it.

The world can't afford this kind of corporate welfare and tax breaks to the uber rich. These are the kind of crap that led to civil wars and revolutions. That's not being alarmist or whatever... it was 100 years ago that the Tsarists Russia got overthrown and most of European Royalties either go overseas seeking refuge or go on welfare.


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## luutzu (11 November 2017)

brty said:


> One aspect I brought up around 10 years ago on this forum was the difference I see between investing and trading. Investing is giving the company money, or starting a business etc, while trading is the secondary market, even though most call buying stocks on the market investing.
> I think the terminology often confuses people.
> Both are obviously needed, despite people often losing in the speculative end of the market (and the so called blue chips for that matter), simply because they are trading when they think they are investing, and basically don't know the difference, nor know how to do either.




It's the secondary-market aspect of the stock market that makes it an awesome opportunity for investors who approach the market as an investor.

That's not to say that traders and speculators don't make money etc., it's that a little puny shrimp with a few grand can "own" a share in the country's/world's largest corporations. Ownership that they can either go along and grow with the business and/or liquidate when the market become too speculative. Or when better opportunities are found.

I mean, you can't really dream of a better way to make money than the stock market. Beside starting your own business, nurture and grow it yourself...


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## notting (11 November 2017)

http://money.cnn.com/2017/10/31/news/economy/tax-reform-house-bill/index.html


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## luutzu (12 November 2017)

notting said:


> Yeah but not quite.
> Because who ever you bought the shares from may spend that money on something that contributes to productivity.
> It seems now we are being challenged to create sustainable and economic models rather than this mad 'growth only pyramid system' which is destroying the very environment that allows life at all!
> I have never seen a weather map showing three cyclones all lined up in a row and heading for Florida like what happened this year.  It will probably happen again next year too.
> There are tough times ahead!  I tell you this.




Yea, the main measure of corporate/entrepreneurial success seems to be "growth". Growth for its own sake leads to a whole lot of shiet. And fudging the numbers or misleading investors by overpaying for assets for "synergies" and strategic vision seems problematic only because it affect the investors own wealth.

There should be more appropriate measures/incentives than "growth" in profit and sales. 

Let's take a "normal", profitable, business doing the same thing, at the same volume etc. it's been doing. If its sales hasn't grown, it's not doing well for some reason. If its profit margin hasn't increased, management is not performing or being efficient.

If the business is doing the same amount of business, making the same amount of profit... that's not a bad thing. Sure it's better if its sales could grow and its margin gets better through innovation and efficiency etc., But that's not always possible... but since incentives are measured on those terms, there are many ways profit and sales can increase... and it's not always better for the stakeholders, the workers, the customers... and eventually not good for the shareholders/investors themselves.

Cut corners to reduce costs (and quality); push for laws or just push workers to overworked and otherwise being exploited; push for wars to open up markets or get access to resources... The costs of war or destruction of the environment.. .that's somebody else's problem as long as the business can get its material cheaply.


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## luutzu (12 November 2017)

Value Collector said:


> We need global tax reform, But I have no Idea how that can happen.
> 
> Global Businesses need to structure their affairs in ways to protect them selves from double and triple taxation, this causes them to employ tax experts that get paid to set up the most tax efficient structure possible, normally resulting cutting out or paying only token payments in some regions.
> 
> If there was a global tax system that allowed the total tax paid to be limited to about 30%, less companies would be seeking out tax havens, but if countries choose to have laws that result in multiple countries charging tax on the same profits, companies need to protect themselves.




Companies need to protect themselves against themselves.

The current crop of corporate titans need to wised up and create some serious think tank and lobby for regulations so that they have stronger regulators to save them from their own greed.

According to Chomsky, that's what the smarter titans did back in the heydays of corporate 'merka.

Nowadays, judging by the tax loopholes and corporate welfare that's been pushed onto politicians to either sign off or go home, corporate leaders are not thinking long-term enough. They're buying into the bs "free market" and greed is good themes their smarter bosses pushed into academia the past few decades.

I think Canadian John Raulston Saul saw this current corporate race to the bottom coming a couple decades ago. That corporations are pitting one gov't against another, getting them to do better deals, giving more tax breaks and incentives... then pushing for more and more. I mean, it is natural to do that kind of stuff in business... hence, the need to put in place strong regulation to stop them from self-harm.

Probably need a major war and a serious case of civil unrest and/or natural disaster to refocus their thinking.


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## luutzu (12 November 2017)

Value Collector said:


> All the taxes that they paid over their lives have been spent as they paid them, Once you deducted all the government spending they benefited from e.g. their schooling, Health care, police, roads, family benefits etc etc, any small remaining amount of excess value they have contributed would be eaten very fast when you factor in 20 years of pension and health care.
> 
> The kids joining the work force today inherit government debt, there is no savings account left by the government of their grand parents generation from which their grandparents are drawing on.
> 
> ...




It's not just moral, it's also economic.

If there are no demand for goods and services [i.e. no money for people to pay for their demand], capitalists will just spend their cash buying back stocks, giving it to themselves and buy stupid stuff. Well, maybe they spend a few cents on the dollar to gamble on some new idea, but that's only if they're Steve Jobs... or maybe Elon Musk - but that's only because he get to risk mostly other people's money so that's no biggie.

Then there's the social, security, health and public safety issue.

Unproductive able-bodied people, particularly youth... they don't just spend all days watching netflix or on forums. Well, they might until the pays run out and those too are cut... 

So the gov't will either have to lock those potential trouble-makers up for some silly non-violent offence; or face riots and rebellion.

Then there's the poor being sick but permitted to go on public transports or walk about the more gentile part of the city.


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## SirRumpole (14 November 2017)

Interesting article.

What struck me was the massive increase in employment servicing unproductive sectors of the community.


https://www.theguardian.com/busines...ore-jobs-than-destroyed-140-years-data-census


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## Value Collector (14 November 2017)

SirRumpole said:


> What struck me was the massive increase in employment servicing unproductive sectors of the community.




Which unproductive sectors you are talking about?


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## SirRumpole (14 November 2017)

Value Collector said:


> Which unproductive sectors you are talking about?




Statistics suggest the number of these workers soared from 29,743 to 300,201 between 1992 and 2014.

In the same period there was also a


580% increase in teaching and educational support assistants

183% increase in* welfare*, housing, youth and community workers

168% increase in *care workers and home carers*
If people were productive they wouldn't need welfare or care.


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## Tisme (14 November 2017)

Value Collector said:


> Which unproductive sectors you are talking about?




The ones that don't produce anything, which is about what 80% of the employment sector, the rest working for Mr Pareto?


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## Value Collector (14 November 2017)

SirRumpole said:


> Statistics suggest the number of these workers soared from 29,743 to 300,201 between 1992 and 2014.
> 
> In the same period there was also a
> 
> ...




Teaching and education isn't unproductive, in fact its one of our big export industries.

Welfare, care workers and home carers etc if they are paid for by a tax on the productive economy are a drain on the system, and the economy would be fine without them. (economically speaking, though as I said we do have a moral duty to supply those services, and as the economy becomes more productive, more services can be offered)

We shouldn't look at welfare as being a good thing because it creates employment, that  "employment" is a drag on the economy not a boost.


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## Value Collector (14 November 2017)

Tisme said:


> The ones that don't produce anything, which is about what 80% of the employment sector,




Such as?


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## SirRumpole (14 November 2017)

Value Collector said:


> We shouldn't look at welfare as being a good thing because it creates employment, that "employment" is a drag on the economy not a boost.




I agree, welfare ends up being paid for by the taxpayer, and labour costs are gradually being shifted from the private sector to the public system and the tax burden will also have to shift in reverse, away from individuals and back to the private sector.


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## Value Collector (14 November 2017)

SirRumpole said:


> tax burden will also have to shift in reverse, away from individuals and back to the private sector.




I am not sure what you mean by that.

Are you saying Individuals shouldn't be taxed? Individuals tax returns is where the bulk of the Dividends and Capital gains are going to become taxable.

In a perfect system, the bulk of people would be Investors, with pretty much every one having ownership interests in the productive economy and receiving dividends and capital gains profits, and paying tax.

The would be employment in service industries, education and entrainment some which don't exist yet, that allow people to earn money from which they can build a portfolio if they weren't lucky enough to inherit one.


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## SirRumpole (14 November 2017)

Value Collector said:


> I am not sure what you mean by that.
> 
> Are you saying Individuals shouldn't be taxed? Individuals tax returns is where the bulk of the Dividends and Capital gains are going to become taxable.




Labour costs are being transferred from the private sector due to increasing technology and being transferred to the areas usually supplied by government. aged care, disability care community work etc resulting in increased cost to government whereas the private sector will show increased profits from technology and they will therefore have to pay a greater share of the tax burden.


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## Value Collector (14 November 2017)

SirRumpole said:


> Labour costs are being transferred from the private sector due to increasing technology and being transferred to the areas usually supplied by government. aged care, disability care community work etc resulting in increased cost to government whereas the private sector will show increased profits from technology and they will therefore have to pay a greater share of the tax burden.




Yeah, but individuals will still need to be taxed. Of course the tax burden falls on the private sector, it always has, but that in no way means taxes shouldn't be paid at the individual level, individuals are the private sector.

Also, Automation will take labour costs out Aged care etc also.

I saw these guys in action at the royal north shore a few months ago, its just the start.


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## SirRumpole (14 November 2017)

Value Collector said:


> Yeah, but individuals will still need to be taxed. Of course the tax burden falls on the private sector, it always has, but that in no way means taxes shouldn't be paid at the individual level, individuals are the private sector.




I never said individuals should not be taxed.


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## Value Collector (14 November 2017)

SirRumpole said:


> I never said individuals should not be taxed.




When you said this 


> tax burden will also have to shift in reverse, away from individuals and back to the private sector.




I thought you were saying that individuals shouldn't be taxed.


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## SirRumpole (14 November 2017)

Value Collector said:


> When you said this
> 
> 
> I thought you were saying that individuals shouldn't be taxed.




Individuals paying less tax and companies paying more is not the same as individuals not paying any tax.


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## Tisme (14 November 2017)

Value Collector said:


> Which unproductive sectors you are talking about?



http://www.abs.gov.au/ausstats/abs@...view=productsbytopic&Action=Expand&Num=3.10.2


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## Value Collector (14 November 2017)

SirRumpole said:


> Individuals paying less tax and companies paying more is not the same as individuals not paying any tax.




That would just happen naturally under the current tax system, no need for changes, as companies profits rise due to lower staff costs, they pay more tax. (what generally happens is part of the savings flow through to profit, but a lot of it ends up transferring through to lower prices for consumers and better wages, conditions and benefits for remaining staff)

But, as I pointed out the whole purpose of companies is to make money for their shareholders, who are individuals and will be taxed on any dividends or capital gains that they receive.


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## Value Collector (14 November 2017)

Tisme said:


> http://www.abs.gov.au/ausstats/abs@...view=productsbytopic&Action=Expand&Num=3.10.2



I have no idea what you want me to get from that link.


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## SirRumpole (14 November 2017)

Value Collector said:


> But, as I pointed out the whole purpose of companies is to make money for their shareholders, who are individuals and will be taxed on any dividends or capital gains that they receive.




Dividend imputation ?


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## Value Collector (14 November 2017)

SirRumpole said:


> Dividend imputation ?



What about it? it's just to prevent double taxation.

It just means that the profits when they hit the Individuals tax return won't be double taxed, and will instead be taxed at the individuals tax bracket, which may be much higher than the 30% company tax rate.

eg. company profits that pass through to individuals end up being taxed at the individuals personal tax bracket, So if the individuals personal tax bracket is lower than 30% then get a refund if its higher they have to pay more.


For example,

Say a company earns $1 Million, it will pay $300,000 Tax. (30%)

That company can then pay that remaining $700,000 as a dividend.

The dividend has a tax credit of 30% on it, However if the individual that gets that dividend is a high income person with personal Tax rates of up to 45%, they will have to contribute an extra 15%, to bring the total tax rate up to their tax bracket, eg 30% already paid at company level + 15% paid by them means the total tax paid on those company profits is 45%.

so the individual level is where the final "real" tax rate is determined.


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## Tisme (29 April 2018)

https://datawrapper.dwcdn.net/nwwL2/6/


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## Gringotts Bank (29 April 2018)

Tisme said:


> View attachment 87130
> https://datawrapper.dwcdn.net/nwwL2/6/



That's fake.

Modelling is where the big differential occurs and it's not even mentioned there.


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## Tisme (29 April 2018)

https://www.businessinsider.com.au/...ghlights-a-disgraceful-gender-pay-gap-2016-12


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## SirRumpole (29 April 2018)

Isn't there an old saying that something (or someone) is only worth what someone else is prepared to pay ?


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## Gringotts Bank (29 April 2018)

SirRumpole said:


> Isn't there an old saying that something (or someone) is only worth what someone else is prepared to pay ?



The trick is to *control supply.*  Notice how specialist doctors rank in the top 20?  That's no accident.


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## SirRumpole (29 April 2018)

Gringotts Bank said:


> The trick is to *control supply.*  Notice how specialist doctors rank in the top 20?  That's no accident.




Very true. They don't like training their competition.


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## Tisme (30 April 2018)

SirRumpole said:


> Isn't there an old saying that something (or someone) is only worth what someone else is prepared to pay ?




Like the most militant union in Australia (AMA), the college of surgeons maintains a tight grip on it's prestige.... thank goodness it doesn't have a royal charter.


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