Saturday, April 23, 2011

Kiwiblog takes a predictable position

Kiwiblog is pouring cold water on 'Don's decision' . Hardly surprising. A Brash-led ACT would drag default votes away from National; people who want far more economic austerity and long-term vision but would have ticked National as better than anything else on offer. For mine I would like to see Rodney stay in ACT but move aside. He is brilliant in many ways but not as a leader. I mean that as no criticism and have said it before. I see it because I would say exactly the same about myself (not the brilliant bit). Simply that there are some personality types that just don't want to manage people. There is no shame in admitting that.

What I am less happy about is Banks climbing on the ACT band wagon. He tried in 2008 and I opposed the idea. No reason to change.

Friday, April 22, 2011


An enforced 'holiday'. I will end up doing housework all day. Because when I am not at my shop working (suddenly the work has come in - hallelujah) I will be forced to confront the other environment. And there is no other escape. No horses to speculate on, no trips to the mall which I loathe but mini-me adores. Thank goodness I remembered to buy a bottle of sav yesterday so at least when I have finished vacuuming, washing floors, windows, laundry, mowing lawns, weeding, cooking a roast (not a leg of break-the-bank lamb :-() sighing over my munted car after someone fell asleep behind the wheel of their van and left me with no choice but to go into the sea or take a hit, cleaning the oven (now I jest), I can reward myself. Best I get on.

Wednesday, April 20, 2011

The cost of taxation

This is explained well by Laffer and summarised by the NCPA:

* To start with, individuals and businesses must pay the government the $1 in revenue plus the costs of their own time spent filing and complying with the tax code; plus the tax collection costs of the IRS; plus the tax compliance outlays that individuals and businesses pay to help them file their taxes.
* In a new study, Laffer and his colleagues estimate that these costs alone are a staggering $431 billion annually.
* This is a cost markup of 30 cents on every dollar paid in taxes.

If it is 30 percent in the US I can think of no reason why it would be any less here.

He then goes on to show how a simplified flat rate would add to economic growth:

* Consider a family that made $40,000 in the year 2000.
* If their income grew by 3.2 percent per year, the average long-term gross domestic product growth rate, their income by 2010 would be $53,110.
* Now imagine that the growth in the family's income was not 3.2 percent but 3.72 percent (the impact from halving the costs of our current complex tax system).
* Under this higher growth scenario, the family's annual income would have been $55,568 in 2010.
* The slight increase in the economic growth rate raises this family's purchasing power by 4.6 percent.

Do you think that the politicians and activists moaning about the rising costs of living could be interested in this counter-balance? In fact, the CPI would not be rising to the same degree if a flat tax were introduced, so you can add to the increased purchasing power the family would have. And not that I want to hold up government spending, but a lower flatter tax rate could be achieved without reducing revenue.

Just a thought that follows on as I muse about NZ's tax system, Peter Dunne, as Revenue Minister, is a waste of space. But imagine Hide in that role. And then imagine if Honest John actually told us who he wants as Ministers before the election.

Tuesday, April 19, 2011

Teenagers on a sickness benefit

MacDoctor makes mention of Professor Innes Asher hand-wringing over the rising number (Table SR.1) of teenagers on a sickness or invalid benefit. I pointed out that the majority of grants for an SB during 2007 were for pregnancy. But I suspect that overall the rise is because of the growing diagnosis/ incidence(?) of psychological and psychiatric disorders amongst teenagers. This is the cause for general growth across these benefits.

From my OIA file:

As MacDoctor points out Innes says;

“There was a large increase in the number of young people receiving the sickness and invalid benefit between 2002 and 2007 (the largest increase was in the 18-19 age group). “Why was there such an increase in young people on invalid and sickness benefits? How much is due to mental and physical disease as a result of the increase in child poverty?”

She refers to the increase in child poverty in the 1990s and those children now becoming young adults.

Yet statistics show;

June 1990 9.7 percent of sickness beneficiaries were aged 15-19
June 2009 5.4 percent of sickness beneficiaries were aged 16-19

Children of the 1970s were also victims of growing child poverty?

Incidentally, in 1990 67 percent of sickness beneficiaries aged 15-19 were unmarried women. Hint.