Wayne Swan on the Privilege of the 0.01%
Treasurer Wayne Swan has posed a challenging question to Australian society with his piece in The Monthly, asking ‘are we willing to allow the elite to control our economic policy, democratic processes and now our freedom of the press?’ A battle is underway to avert the kind of inequality that the USA endures.
In his commentary he fails to discuss the privilege of the 0.01% to plunder the common-wealth. That is where their real advantage lies and why the tax system should act to re-balance these natural advantages inherent in the private ownership of such valuable resources.
After all – has the local baker been able to increase his prices 900% over the last decade like the Iron Ore magnates have? The scarcity rents that have allowed the Rinehart’s of the world to benefit from these higher prices result from absolutely no additional effort on behalf of the owners. This is unearned income and should be taxed away as part of every Australian’s birth right. This money should be used to fund a serious reduction in the corporate tax rate.
The 0.01 Per Cent: The Rising Influence of Vested Interests in Australia
by Wayne Swan
The rising influence of vested interests is threatening Australia’s egalitarian social contract.
Australia’s fair go is today under threat from a new source. To be blunt, the rising power of vested interests is undermining our equality and threatening our democracy. We see this most obviously in the ferocious and highly misleading campaigns waged in recent years against resource taxation reforms and the pricing of carbon pollution. The infamous billionaires’ protest against the mining tax would have been laughed out of town in the Australia I grew up in, and yet it received a wide and favourable reception two years ago. A handful of vested interests that have pocketed a disproportionate share of the nation’s economic success now feel they have a right to shape Australia’s future to satisfy their own self-interest.
So I write this essay to make a simple point: if we don’t grow together economically, our community will grow apart.
The catchcry of Wall Street’s Zuccotti Park and the Occupy movement, ‘We are the 99%’, has shone a spotlight on the top 1%. Between 1979 and 2007 in the US, the top 1% saw their after-tax incomes rise 275%, while the middle two thirds saw their after-tax incomes increase by less than 40%.
Investment income is a strong driver of this concentrated privilege, with Forbes finding the top 0.1% net over half of all capital gains in the US.
Read the full article in The Monthly