After the PC had shut down any talk of doing something about negative gearing and the half-rate capital gains tax, and excused away the federal tax system’s $18 billion annual subsidy to owner-occupiers, its brave call for the abolition of stamp duty was the only significant proposal left.
Monday, December 22, 2003
John Quiggin - Political correctness at the PC
Posted by Housing Affordability at 1:28 am
Sunday, December 21, 2003
'There's an elephant in the living room that nobody in the official family feels comfortable talking about.'
The Productivity Commission's draft report on housing affordability is the most disillusioning document the econocrats have produced in a long time.
It leaves me concluding they've become little more than handmaidens to an overbearing minister - despite their supposed statutory independence.
It was clear at the outset that Mr Costello commissioned the inquiry without any genuine belief there was a policy failure at the heart of the housing boom to which he needed a solution. So the PC has produced a report consistent with the Boss's lack of fair dinkumness.
Mr Costello's main motive was merely to defuse the cyclically predictable burst of pseudo-concern about the plight of first-home buyers by shunting the topic off to an inquiry.
But his secondary motive was to shift the blame for the worsening in housing affordability to the premiers by carrying on about the growth in the states' collections from the stamp duty on conveyances.
And the truth that only a fool would announce a crackdown on negative gearing at a time when the bubble was about to burst can be portrayed either as an excuse for inaction or as a counter to the vested interests' claim that a crackdown is impossible: the key is getting your timing right.
This report is intellectually dishonest and cowardly. It's idle for the economic rationalists to keep carrying on about the politicians' "reform fatigue" when, in the face of someone as terrifying as Peter Costello, the bureaucratic leaders of the movement have lost their bottle.
Econocrats ignore the elephant in the living room - www.smh.com.au
Posted by Housing Affordability at 1:53 am