Prosper Australia

The power of monopoly rights was recently exposed with the growth in parking revenue at Melbourne Airport. Australian Pacific Airports Corporation is the owner of Melbourne Airport, a group controlled by a number of Australian infrastructure funds. It was reported in this Herald Sun article that Australian Pacific Airports Corporation derives 18.3% revenue from parking, versus only 8.3% by the Macquarie Infrastructure owned Sydney Airport.

Passengers at Australia’s 5 airports have grown by 41% since 2002, but parking revenue has grown by 77%. Short stays cost $10 versus $4 in Adelaide.

Monopoly rents are extorted by the lack of alternatives patrons of the airport face. A Prosper Australia member was both embarrassed and outraged when a plane was late for arrival, sending the parking fee from $10 to $20. Such an exorbitant price gouge emptied his pockets and left him a little embarrassed with the ‘just met’ father-in-law unimpressed at the unexpected scrounging for coin.
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by Anne Schmid

JUNE 2006

This submission is made with particular reference to the proposed introduction of the waste collection charge.

I ask the question – Are user charges better than rates? What is the next charge going to be? Traditionally councils have relied on rates for their revenue and a push to obtain local revenue from sources other than local land values leaves councils vulnerable to vested interests, pressure groups and anti social forces.

I believe that unless we have local revenues collected from site values all words about community building and equity is merely rhetoric.

Councilors, ratepayers and council advisors must recognize that council services generally, whether a transport system, water reticulation, sewerage, or rubbish collection, enhance land values. Ethically it is on the land values so created that the annual rates should be calculated as in site value rating. CV rating corrupts this to a large extent as properties are rated on improvements as well as site value. User charges disconnects completely any recognition of the relationship between services and land value.
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With Oil soon to hit $120 a barrel, public interest is building on the role speculators play in pushing prices higher. India’s Solution for Oil Prices: Ban Speculation by Banning Trading quotes:

“Buying stakes in overseas oil properties is proving much cheaper for India than purchasing crude on the open market. In some areas where India has purchased stakes in oil fields, it is pulling light crude oil — the kind that sets the benchmark oil price — out of the ground for less than $40 a barrel, Mr. Srinivasan said.”

We aren’t supporters of regulation. Using economic analysis we can see that any price above the $40 India can pull light crude out of the ground is economic rent. Thus in many situations, speculators are accounting for two thirds of the price of oil. We propose that the government can eradicate speculation by adopting a more effective revenue raising system. If a resource rental was charged per barrel of oil then resource hoarding would no longer be financial. The resource rental acts as a holding charge, set at approximately 5% of the value of the resource. This rate would soak up the economic rent and deter the buying and selling of oil.
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Watch this clever animation of modern life and the insights gained when the big picture is considered. Animation is such an effective learning medium in our cluttered worlds. Life from all levels is analysed - except of course the big one - the monopolisation of land rents and how that drives sprawl, singularity and reduces our freedom to really do what we want to do.

Well boo hoo…..at least we can hum along to everyday life…. wait till we get some animations up like this. Any superstar musicians want to collaborate?

PS - Remind Me: the Affordable Housing & Community Land Trusts event is on this coming Monday.

Todays Age article on Land Tax Cuts Wont Bring Savings alerts all those interested in defending the communities right to a share of the free lunch land prices reflect. The next few weeks will see the property lobby step up their claims to pay less and less of the one tax their army of accountants can’t dodge.

Some points we agree with. The article states that the State Land Tax cuts over the last 3 years from 5% to 2.5% for the top marginal rate have been offset by rising land prices. Suprise, suprise! Lower holding charges on land encourage more speculation, especially at the top of the market, where capital gains have been higher in both percentage and nominal amounts in many suburbs.

What we do agree with is the warning on bracket creep. The Brumby government should index Land Tax rates to CPI or ultimately to land prices as calculated by the Victorian Valuer General.
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by Karl Fitzgerald

as published in Arena Magazine, Feb-March, 2008, Edition 93

In a period where the twin crises of global warming and the wealth gap are attacking society from both sides, policy makers are continually limited in their effectiveness by a two dimensional approach to economics.

Land prices have increased at 4 times the rate of GDP and dwarfed wages growth by 1000 to 1 since WW2 (The Poverty Inquiry to end all Inquiries, Tony O’Brien, Figure 1, p5) . Such damning statistics beckon the ALP to take a hard look at the economic fundamentals undermining union wage demands. For Julia Gillard’s ‘War on Poverty’ to be successful, policymakers must look outside the square.

2008 marks the half way point in our promise to halve world poverty with the Millennium Development Goal’s 2015 deadline. With the wealth gap accelerating in both Developed and Developing countries, a serious flaw is evident in modern economics.
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Following last years highly successful economics for activists series of workshops, Karl Fitzgerald is presently preparing the 2008 material. Designed for those activists interested in understanding economics, the short-comings prevalent in economic theory and how basic economic principles can assist them in their particular interest area, this free short course is essential in this age of economic malaise.

The course will run in July/ August for 4 weeks.

More details to be released soon. Email here to register your place for this free series of workshops.

Check this new Ausse film - a must see for those concerned about globalisation, terrorism and the wealth gap. Unfortunately it doesn’t have the kind of hard nosed economic reform we would like, but still well worth the viewing for the lessons on the Middle East. This review gives a hint of the sensory feast audiences can expect.

“Global Haywire is a cunning film about the evolution of man and the politico-economic power structures concocted to divide and conquer. Yes! Finally a cutting edge film on globalisation that sums up the exasperations of the social justice movement.

Infamous Australian cartoonist Bruce Petty is the writer-director and uses his artistic license to sum up moments in time with a masterful stroke of his brush. Bruce Petty does this in spades with his trademark scribbly cartoons, billowing a breath of fresh air into the documentary format. Complementing his art is absurdist dialogue, a contemporary soundtrack and interviews with all-star intellectuals.

Petty’s doodling cartoons inspire the senses as they zoom across the screen, keeping viewers on their toes and challenging the audience to lift their intensity. It is rewarding to be challenged by a documentary that hits you with simultaneous issues, forcing our thought patterns to speed up in accordance with the tidal wave of torments rising on the horizon.”

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With the recent passing of our number 1 ticket holder, Clyde Cameron, we were pleased to hear the ABC’s Phillip Adams replay the 1999 Late Night Live interview he held with the Honorable Clyde Cameron. It is a fascinating discussion with Clyde covering the foundation to his Georgist beliefs, involvement in the Henry George League of S.A and his disappointment at the ALP’s drift from its original intention to capture the community generated economic rent in lieu of all other taxes. Insights on ALP history and the Whitlam era abound in this fireside chat.

Download and listen to this essential piece of Australian Georgist history.

by Dr Gavin Putland

Given that the economy is managed so that a certain percentage of people must be losers, the majority stands to gain by ensuring that the losers are selected not from its own ranks, but from the ranks of some already disadvantaged minority. That’s why, forty years after Dr. King’s mountaintop” speech, African Americans still haven’t reached the Promised Land. The solution is to minimize the need for losers. Here’s how.

Forty years ago, as Martin Luther King Jr. spoke of the Promised Land and prophesied “I may not get there with you,” a quiet revolution in economic theory was beginning, which would ensure that Dr. King’s hearers, except perhaps the occasional Caleb or Joshua, wouldn’t get there either. The architects of the revolution didn’t plan it that way, but that’s the way it turned out.

The revolution concerned the relationship between unemployment and inflation. A paper by Milton Friedman, published in the month before Dr. King spoke, and another by Edmund Phelps, published a few months later, gave reason to believe that in the long term, if unemployment falls below a certain rate, inflation speeds up, whereas if unemployment rises above that rate, inflation slows down. That magic unemployment number became known as the Non-Accelerating-Inflation Rate of Unemployment, usually abbreviated by the acronym NAIRU.
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