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- WHY AUSTRALIA'S DOLLAR WILL KEEP FALLING -
In the USA the difference between the political parties is quite stark on the subject of taxation.
Republican Bush plans to give the excessive tax collected back to the people. Democrat Gore plans to spend it.
In Australia and Europe there is never any question that the government might return tax surplus money. Politicians in Australia continually scheme on ways to get even more money out of Australian taxpayers, with which to "Tammany Hall" the 51% of the people that they need to be elected.
Last week Prime Minister Johnny Howard learned that he might have a budget surplus (about 2% of tax receipts) from his "new tax system". He told the daily press that he planned to spend some of that surplus on road maintainence. (which the opposition labelled "pork barrelling" to the bush. The opposition wants a reduction in the petrol tax.)
In Australia's two party system, Mr Howard is supposed to be the "conservative" option. Yet it is opposition leader Beazley who promotes returning the tax surplus to the people! I don't know about "down under", for politics how about "upside downer"?
Back to the real world. Interestingly, on the call that Bush might win, the US dollar rose against the Euro & the $AU. When Gore appealed, the $US fell. The US$ has been strengthening, presumably wall street sentiment is that "Dubya" is to be Prez. If the US dollar begins a retreat it might be a sign that sentiment is that Gore will win.
Funny thing. Why should
reducing taxes stimulate the economy?