Labor Government

***Warning – Long Post***

“In your Economics 101 textbook you will see that deficit has its economic place (e.g. to stimulate and economy) – contrary to the Costello line that it is the root of all evil. It’s just that right now, we don’t need the stimulus and people swallow the “Defecit = Bad; Surplus = Good” line that the Coalition use because it suits them politically.”

>You forget about the ageing baby boomers – that is why it is so important to have surpluses. So when we go to borrow on the international market we get to borrow more and at a lower rate of interest because according to credit agencies (Standard & Poors) there is less risk, rather than being like America – large deficits now, larger deficits in the future, and less capacity to tax or borrow. Wouldn’t it be better to have surpluses now??? Or do you believe that super is going to save us! L0L!!!

“I just wanted to reply to the above & remind everyone that until the coalition came into power under Howard, NO previous Coalition party in power had EVER had a budget surplus! Some previous Labour parties in power had. And we are all quick to forget the major reason for the budget surplus – Telstra???? Read up on your political history fellas!”

>Telstra provided a large surplus, but the budget had an underlying surplus anyway (this ignores one off ‘special’ effects, such as the sale of large Gov assets). Also during the last Coalition Gov was in power at that time the economy was booming and there was no need for surpluses (as the word baby boomer hadn’t probably even needed to be invented then!)

But I digress, on to Labour/Lib governments thoughts:

Labour governments tend to have big social agendas that require large expenditure, which in turn means increase in taxes. An because the unions want to be seen doing something for their members this means this tax burden tends to be shifted on to entrepreneurs, business owners and investors (the people who create the jobs in the first place… but anyway along with the real debate – what will this mean to us!).

I think I could confidentially say that a Labour Gov wouldn’t change current structures fundamentally. Saying that things like taxation would probably change, perhaps trusts wouldn’t get the 50% CGT discount, certain trust loopholes would be changed/closed (when Latham promises no CGT changes, he means for the everyday worker not us investors – it’s called politicians speak), perhaps larger payroll taxes.

He won’t have a lot of room to move however as many dollar commitments the Howard Gov have made is through contracts and these can’t be torn up (thanks to the courts!).

As for his $5 billion in government waste that would be used to fund some of its spending commitments, I think that is very much up in the air, and I know it won’t be used to reduce public service numbers, etc

He states that taxes won’t rise more than GDP, but that is assuming that there is still high growth rates… what if there isn’t????

All politicians lie, it’s kind of like a get out of jail card…. Saying that I would prefer a Howard Gov because I know nothing much is going to change for the entrepreneurs, business owners and investors. In fact I feel there is a higher chance our interests will be protected. With the Labour I don’t see any words to suggest Latham will protect us. Better to go with the Devil you know.

Anything Labour puts up we will get around, but it will increase costs and hassels along the way (and in the end they will just put up hidden taxes which cna be either passed on to the rent or worker, somehow).

As for Negative gearing being outlawed – I don’t think it will happen for quite a while, mainly because the state Gov’s are now relying on stamp duty more and more. Either the Federal Gov will have to increase there contriutions to the States or raise GST (which will mean increases to the States), I don’t beleive either will happen.
When negative gearing does disappear – I will be prepared to jump on some fantastic deals!!!

Rgds.
Lucifer_au

This is exactly why I have a one way ticket in my top drawer.

Fortunately because of mixed parentage (some say mongrel breeding [biggrin]) I have many choices and I hate seeing this once great country going where it’s going.

Cheers

http://www.tradingforaliving.info

Yes foston,

I remember the days of Whitlam- free University education! No HECS and no fees. Oh yes- free healthcare… and public school funding.

kay henry

[snooze][snooze][snooze][snooze][snooze][snooze]

Thanks, Wayne, but as much as getting some of your no-doubt-profound insights appeals to me I think I have a better chance of finding +CF property in Chatswood that I have of finding intellectual stimulation. Perhaps this link may be of use:
http://www.lib.latrobe.edu.au/AHR/archive/Issue-April-2001/curthoys.html

Oh well, at least you guys can debate and still be humorous and not disgraceful. How come you are both sleeping? I am like this: [lmao]

kay henry

How do you think we get schools, hospitals and roads unless we have taxes, folks?

I think it’s ok that we pay our share.

kay henry

SIS – I can’t believe you’ve come out like that.

I’ve been much more careful so that no-one will know which side of the fence I sit on…[winking]

Hi Rubbachook,

maybe i did come out, a little to forward, but from many of the investors, and business owners, its a little to easy to know, who they will be voting for… (…well majority of them) [goatee]

Cheers,
sis

ps… but i will edit that link [strum]

People 4get that by saving just $3 a day & investing it sensibly
over a working life, you’ll end up with around $1 million

ok Chooks, I’ll go there… Let me put it this way… Here’s a riddle for you…

I’m of the political pursuasion that’s more likely to be doe-eyed, than I am to go to my daughter’s wedding, read books to children, or get drunk and steal a bottle of wine and flip out in the senate and half pull a woman’s arm off.

How’s that grab you?

kay henry

Kay,

I suspect the half-pulled-off arm would not grab me too well at all… [blink]

My guess is that you don’t have shares in Gunns?