14th September 2005


The first question to ask of anybody with whom you wish to discuss government, is "What is Government for?"

In more detail, the question to answer is: "Is government's purpose to maintain and regulate resources and essential services and manage foreign relations, or is it there to equalize income by providing transfer payments to those who are needy."

At the moment, our Federal government seems to be there to provide transfer payments on the basis of need (which they do not think of as buying votes, but as "compassion",) although admittedly the incumbent L-N coalition is less guilty of compassion than is the opposition Labour.  That is not to say that our government does not maintain armed forces or regulate mining and the electromagnetic bands.  But more than 50% (probably nearly 75% if Parliamentary perks were removed) of the national Tax dollar goes either directly or indirectly to welfare for those adjudged "needy".  This includes transfer payments (most benefits - sick, aged, most of child support, unemployment), most of health expenditure (public hospitals), most of education (public schools, TEAS) and most of the other departments (drought relief etc).  Our government can never collect enough money to provide perfect equality of income, although a recent estimate has been that about 65% OF AUSTRALIANS OBTAIN A DIRECT GOVERNMENT TRANSFER PAYMENT.

On the other hand, if our government paid only for military, foreign affairs, regulation of bandwidth, regulation of minerals and environment and maintaining a census of citizens, then income and corporate taxes would probably be unnecessary.  More than sufficient funds could be obtained from sale or rent of national resources.

Why unnecessary?  Well costs and the Public service will be much reduced, and many publicly owned income resources are under taxed or do not pay sufficient rates.  As an example: Rates on residential land are far too low.  Some of that prized Sydney Harbor waterfront is rated at less than $5,000 pa. Commercial TV & radio stations are paying next to nothing for the bandwidth that they use.  On the other hand, the GST is totally iniquitous, and the petrol tax and registration tax (based on a percentage of fuel cost & vehicle weight) should be flat taxes used to provide a free, high quality road system, not the ripoff percentage of fuel price and piddling small weight tax that does not nearly recover for the damage done by the huge, road destroying mammoths.  (The government should throw in free public transport for people while they are at it.  It would certainly reduce ticket compliance costs, and sufficient profit could be had from rail transport.).  As for petrol taxes escalating as the price of petrol increases, that is pure robbery.

If we consider the public utilities.  Water collection should be encouraged on a per household basis, and advances in photoelectric technology and energy storage will, within about a decade, render both power generation and power reticulation uneconomic & (to a large degree) redundant.  Photoelectric cells and wind turbines will provide energy to a storage device (such as, for instance, a flywheel or battery) which will provide energy during dark & calm periods.  On the other hand, efficient communications might well rely upon the copper network for the foreseeable (20 years) future.

In fact, I suspect that if these things were done, (abandon transfer payments, and concentrate on defense, transport, civil management) then increasing the defense budget by 20%), there would be a surplus of up to $10,000 per head..  Of course we could give this surplus to our politicians for them to decide what to use it for.   But my suggestion would be to pay it back (equally) to all people.  In fact, because our politicians would now have fewer responsibilities, I would suggest that we reduce their rorts (remuneration, super, free transport, allowances etc etc.) and give that money back to the people too.


Turnbull MP (Woollahra) has again been in the news.   He suggested that the government provide a free email address for every Australian.  Congratulations, Mr Turnbull, an excellent idea.

While you are at it, why not provide a free savings bank account (for all business between government and the individual, such as payment & refunds of taxes, collection of pensions, payment of stamp duties, and other government fees and charges.

The accounts could be exclusively accessible from the internet, and based, in the first instance, on hospital birth/death records combined with immigration/emigration records.  (I would suggest fingerprints, voiceprint and DNA identification as well.) 

I suspect that the (competitive) contract for providing such services would probably be less than the total bank fees that the various Australian governments pay financial institutions for the services that they require.  I would also suspect that the value of (interest earned by) the money on deposit would also more than pay for the service provided.

Such a savings account would guarantee the security of the savings of ordinary Australian punters, since the federal government would be the only borrower from the savings bank.   Interest could be paid at the same rate that the Federal government is prepared to pay for it's own public sector borrowing,   Chequing accounts, credit cards and other risk management accounts business which would pay higher interest on borrowing and lending of funds would remain the exclusive preserve of corporate financial institutions.

Of course we would have to educate everybody on the use of the internet, and several hours internet access should be readily available to everybody each week at publicly operated POPs.  For those who could not, under any circumstances, operate the internet, the default would be automatic transfers from the government account to existing accounts, and alternative (public library, social security etc) assistance for access to email.

Once each person has free, government secured, government provided email and savings bank accounts, we could all vote by email.  In fact, maybe we could instruct our elected representatives, without the possibility of fraudulent polling, on just how we think s/he should vote on any legislation that comes before parliament.  Something along the lines of the online opinion polls operated by the communications (TV, radio, newspaper) websites.

Eventually, we might not even need representatives to govern us.  Whoopee.


After the first (T1) tranche, selling Telstra was always a conflict of interest.  On the one hand, the government has got to kid the buyers that it is not going to regulate the copper, (which is, of course, half of Telstra's value) so their investment is as good as money in the bank.   On the other hand, unless it does deregulate the copper, then Australian consumers are never going to get a competitively priced copper network.  And in my opinion, copper is going to retain it's value, no matter what technological advances are made.  This is because, like real estate, there is only so much bandwidth, and although we might use what we have more efficiently, God is not making any more bandwidth.   The alternative is copper.

This is the issue that Trujillo has brought to our attention.  If the copper is deregulated (and I have no doubt but that, the minute Howard has ridden himself of Telstra, it will be regulated that Telstra must give free access to it's copper at a maintenance price), then Telstra is only worth something between $2.20 and $3.50.  Those who bought T1 & T2 will not be happy.  Those who bought T3 on ambiguous promises will probably not be happy.

On the other hand, perhaps TLK (The Little King) might decide that he should do what I suggested and give the copper (local loop) to local government.  This will be popular, although it will cost the federal government somewhere between $5 - $30 billion (depending on what they expected to get, and on how much municipal councils can be persuaded to cough up).  It will also solve nasty little problems with the selling price of T3 with respect to the price of T2.

15th September 2005  Parliament enacted a sale of Telstra bill last night.  I suspect that in a few weeks, Telstra will be worth a punt.  Then wait for TLK to do his magic, and up it's price.  At all costs, however, sell before T3 is foisted onto the public.  There is one caveat - If TLK promises on his mother's grave - no, on his preselector's head that he will never force Telstra to share it's copper at cost, then it might be worth holding on until the next election.

- GAZA -

In the past few days, the Israelis have handed government of Gaza to the Palestinians.

Palestinians have burned the Synagogues that were left.  So much for the supposed Moslem "respect for other religions" theme.

Not that we Christians always show a Christian attitude.  Our past shadow prime minister, currently Foreign Affairs minister, scion of an Australian political dynasty has been living up to the label put on him by journalist Liz Hayes. (I think it was her).  In an interview she called him "the cream".  When questioned by her (dubious) interviewer, she explained "rich & thick".

Foreign minister upside Downer congratulated the Indonesian Government on sentencing to death some of those who plotted the Jakarta Embassy bombing.  Quite apart from the unsavouriness of approving of the taking of life, I believe that he was premature, and it was improper of him to approve the death sentence on behalf of Australians.  In Australia we have not executed anyone for decades.

The PLO and Hamas are both claiming the credit, Hamas because they have harrowed the Israelis into leaving, the PLO because of their negotiating skills.  Perhaps it is a bit of each.  It was probably uneconomic for the Israelis to hold Gaza while Hamas was keeping the army there on a war footing, on the other hand, it is unlikely that the Israelis would have handed control to those who had sworn to eradicate Israel.