Billl English announced today a further $1.8 billion slashed from so called “low quality” spending over the next four years
It seems that to this mean spirited Government “low quality” includes services that needy Kiwis rely on such as:
- Home help for sick and frail senior citizens, including in Southland
- Intensive rehabilitation for seriously ill patients in the Manawatu
- Frontline bio-security officer jobs that keep our agriculture safe
- Police cars that get our cops to the scene of the crime
- Adult and community education centres for many thousands of Kiwis
Why? Increasingly clearly, it is to fund unfair and unproductive tax cuts for National’s already wealthy mates.
This is Robin Hood in reverse – taking from the poor and needy to give to the rich.
National slashes it: the rich stash it .
Spud Muldoon provided my housing initially…..
And yes, I figured you would be against changes to the alcohol law as for you, it is part of your 5 plus a day!
Rebecca I am wondering if you have some strange sort of device which ensures you go about the place FEELING rather than THINKING.
I am at a lose on all the FEELING business people do with no THINKING going on.
At election 2008 we as a country had NO net crown debt. The Labour-Progressive government had paid off much of Robert Muldoon’s “Think Big” debt, had purchased some of our assets back, had record low unemployment, increased the minimum wage 75%, removed the youth rate, had capacity built in education and health, had massively improved the roading net work, significantly improved our international relationships, created modern apprenticeships, paid parental leave, 4 weeks annual leave, Kiwi Bank, Fast Forward Fund, 20 hours free Early Childhood Education and all the rest of it.
Just prior to election 2008 we had a high level of happiness.
Then National hood winked the country saying EVERYTHING was wrong and broken. The country was marketed to.
Our levels of happiness are plummeting.
On gaining the benches the NACT set off on a mission to ensure everything was wrong and broken and that our collective wealth be transfered to them and their wealthy mates.
Using the economic recession as the convienient excuse they pushed through the policies of the robber barons.
Sheriff of Nottingham government with associated hench men, THE MEDIA!
@Rebecca – Good for Muldoon (did I just say that?) – But I thought Labour introduced state houses in the first place.
Agreed,
Nothing like a good drink ! 
@ David, I liked what I read of your interview transcript. And lets not be afraid of going into debt (as a country) IF that capital is put to productive use. Its like not being afraid to get into debt to get the capital you need to buy the plant and machinery required to create a productive enterprise.
NZ needs a strong rich economy if its going to be able to afford the services and facilities that we think our communities and our citizens should have, and the development of advanced industries and advanced services able to sell to the world is the way to do it.
(As well as adding maximum value to our current strengths in primary and commodity exports of course).
@ Spud – of course binge drinking is bad news in this country…for those who doubt ask any ED clinician…the lower socioeconomic demographic and the young are often the ones who get it in the neck as a result. Some rational firm action needs to be taken to improve the situation. (Not sure what precisely though). Increased education on alcohol/how to drink followed by limiting access in a multitude of gradual ways seem sensible enough as a start.
As to your earlier point, making more money available which will in some instances go straight to the publican is not the best situation either. In that scenario, the money won’t have much beneficial impact on family violence I dare say.
The fundamental problem isn’t so much taxation or lack of it, but I think rather it’s the Kath-and-Kim-ism that passes for being “ambitious for NZ”. Climbing the ladder of opportunity – and then pulling it away – is one of the most obvious symptoms.
@ Deep Red: well said. Not only individuals, but companies and countries like to play this game with each another.
Once at the top “now we know better” – kick the ladder of opportunity away from the wall – then (yelling down to the masses vie megaphone) “sorry folks, if only you’d been more like us, now do as we say not as we did”.
Spud: it was a state run children’s home…
Vivienne you’re being rude and patronizing, but then when you are all out of facts, I suppose getting personal is all you have left.
If Labour got it so right then why did they lose in what can almost be deemed to be a landslide? Why are is their chance at getting back into government still at best, only a pipe dream?
Voters are not necessarily academic Vivienne and they don’t necessarily believe that thinking precludes feeling or vice versa.
Further, debt is not necessarily a bad thing and given we still have a relatively low debt by world standards and when paying debt off came at the expense of the voters disposable income well then, there are many who would argue that it was not a good thing.
In terms of “Just prior to election 2008 we had a high level of happiness.”
Who was happy? The people lining up at the food banks? The families struggling to cope with rising cost of living while still paying high taxes?
Why did all these happy people vote out the party that apparently made them happy?
I find it particularly interesting how David Cunliff identified the trade, savings & brain deficit as being the main 3 things that are holding this country back – what a shame Labour did not do more to recognise and validate these issues in their 9 year tenure.
@Loota – I meant money for food, but you’re right some will use it for drinking, but I figure that anyone who would use the extra money for drinking will be sacrificing food for drink anyway.
@Rebecca – just to be clear – are you saying that you grew up in a state run childrens’ home?
I can think of a couple of reasons why they lost, those 2 things even annoyed me, but I think they did a good job.
Loota that may be the case for those who are extremely successful, but the majority of those in the top rate are still slogging their guts out even when they hit the higher wages – because they are not actually rich!
Of the 8% that pay 76% of this country’s taxes (including WFF), how many actually earn over $100k or $150k?
Spud until I went into permanent foster care yes.
I should add the foster care also included time in a church run children’s home. The State paid nothing towards this…
I’m sorry to hear that Rebecca.
Rebecca- you are making valid points and Labour would do well to listen. I’m not sure if you have been a Labour voter-I wouldn’t be surprised if you were- your anger sounds to me like disillusionment. I have been a dedicated Labour voter and I currently feel angry and disillusioned. Amongst other things I was pretty shocked to discover we were in that group of PAYE taxpayers paying what appeared to be all the tax in this country. I naively supposed before that that everyone was paying their share.
We are not wealthy. We drive ancient cars and have never had an overseas holiday. It is hard not to feel resentful- stuck in the middle – paying for everything it seems and at the same time getting no gratitude or recognition from Labour.
In truth Labour can’t get back into power without the votes of people like us. Labour has to reconnect with the voters who would be better off financially voting National, but who believe in a functional society and would prefer to vote left. After all- we pay the tax that the left likes to spend.
Thanks Spud all good – what doesn’t break you makes you stronger.
It’s not all bad though as it taught me that the lack empathy AND validation are society’s primary social ills.
Any one who has any iota of a moral compass would always believe that if you find yourself in a position – whether through inheritance, luck, family connections or just plain ole hard work, that you have a decent amount of disposable income where you are able to pay for car repairs without having to worry whether you can put food on the table, that you should give something back.
It is the EXTENT to which people on this blog site seem to expect that those on higher incomes should pay for other people’s misfortune or bad choices (as no Vivienne, no everyone on lower incomes including those on benefits have made good choices and been beyond disrepute) – even if the tax rate drops to 30c, they are still having to forfeit a third of their income to tax.
Of course I would like to see this done in conjunction with the closing of the loopholes that meant people the Labour government allowed to have a free reign for 9 years are finally forced to pay what they should.
Hi Rebecca:
Of the 8% that pay 76% of this country’s taxes (including WFF), how many actually earn over $100k or $150k?
Does any one know what proportion of income that 8% earn? Is it over or under 76%?
Jane well spotted. Yes I am disillusioned and angry that no one seems to be able to see the forest for the trees!
I was definitely a Labour voter but found by their second term they were no longer a party that seemed to have a strong vision, that they were stuck in the rhetoric of the 1990s and did not seem to recognise the current social and economic climates – something which I believe was at the expense of many “ordinary hard working New Zealanders”, especially families.
Yes I thought everyone was paying their fair share too – that’s the problem with politics, they rely on us being too busy to find answers for our many questions.
It’s only thanks to being able to work from home and have children in Kindy that I have finally been able to suss the political climate out for myself. And when I did, I voted against Labour.
David- you are making sense. Good to hear you acknowledging the damage the housing bubble has caused to our country. Sadly Labour was in power during the whole of the housing bubble.
I asked this question to Trevor and Clare on a previous thread but got no reply.
When is Labour going to start thinking about the welfare of current and future New Zealanders, and stop the sale of productive land and residential housing to foreign nationals? There is no point in stopping New Zealanders speculating in housing if you continue to let foreigners buy up large. And if there is no mood for change within Labour- can you explain how this policy benefits the ordinary New Zealanders Labour claims to represent?
Loota I can’t find the exact stats – I find IRD info to be a bit of a rabbits warren.
Note though that the TWG stated how bout half of a sample of 100 of the wealthiest people in New Zealand pay the top marginal tax rate on their income, according to The Tax Working Group.
If so, that means 4% of tax payers are propping up the country!
I did find this graph but just not quite sure how to decipher it – GST brain on today as have a return to file within 2 weeks!
http://www.ird.govt.nz/aboutir/external-stats/income-distribution-income-bands/
Hi Rebecca,
those graphs show that the massive amount of people with taxable income sit at <$60,000 taxable income per year.
I would interpret your stats slightly differently: that just 4% of people have benefited the most from NZ and are therefore paying the most tax.
You can see in those charts that a vast chunk of people sit on <$25,000 taxable income per year.
From the TWG statement: you mean to say that half the wealthiest people in this country manage to avoid paying the top tax rate? To the other half who are on the top tax rate: maybe they should get new accountants? J.K. lol
The answer to the question – why do Governments tax the rich more? Is fairly simple in my own mind: they can pay more.
Re: Jane – Labour has to do more than stop the sale of the country’s productive assets, we need to create new productive assets – advanced industry and service sectors please.
Just rounding out your argument a bit more
Also your mention of creating intergenerational benefits for NZ’ers is crucial.
Loota yes they can afford to pay more, but how MUCH more is where perhaps you and I differ.
Yes I am thinking the same: maybe we should be paying an accountant $500 p/m to wrangle our books so we can claim WFF and pay less tax.
Of course I would have to sell my soul to the devil first….!
In terms of the graph I think it reflects how since WFF was introduced, there has been an increase in the move to either reduce their income for tax purposes to convert into non taxable income under WFF.
I also not that with the TWG they highlighted the fact that “while New Zealand’s top statutory marginal tax rates are not high by international standards, they may nonetheless raise integrity concerns, discourage entrepreneurship and participation in New Zealand’s labour market, and may be an implicit factor in trans?Tasman migration4. The OECD estimates that a 5% fall in people’s marginal tax rate increases GDP by 1% over the medium?term5. These effects must be balanced against any growth costs of reducing government spending by an equivalent amount.”
I also think this chart perhaps shows the anomaly with our tax system a little better..
http://www.interest.co.nz/ratesblog/index.php/2010/01/06/summer-chart-series-how-the-rich-stopped-declaring-their-incomes/
What about the Littlewood Treaty, we as an individual or a nation have the rights to know why.who,when a renegotiated treaty with any entity is in place.
Recent events regarding MP’S behaviour & what exactly they can do without going to prison is very alarming considering none of them stand up & say “our policy was wrong”,we still keep paying them after they leave that vocation?.
Consider communusim as there is not much different.
Hi Rebecca
The TWG followed a clearly neo-liberal free market philosophy.
Cutting taxes doesn’t grow the pie for everyone, it does however increase the slice of the pie for those already on higher incomes.
As for encouraging trans-tasman migration people don;t go to a poorer country which has lower tax rates.
They go to a richer country which can afford to cut tax rates: yet still afford top class services and infrastructure.
NZ has it a bit assbackwards: lets cut taxes *before* we can afford to do so and somehow that will generate the advanced industry and advanced service sectors that we need.
In fact, I propose that higher levels of Govt intervention are required to create the advanced industries and advanced service sectors that we require, e.g. activities to direct capital towards productive uses, not less. That will require Govt spending more money in the short term to generate returns in the 10-25 year time frame.
And spending more money often implies more taxes, not less…GASP
…I should add that the creation of advanced productive high-value added sectors in the NZ economy is going to make us all richer over time, including the next generation, and allow tax cuts which do not result in compromising the level of services and infrastructure that we feel that our citizens and communities deserve.
Businesses aren’t afraid of spending more and going into debt today – if there is a good return on investment in the foreseeable future.
(Depends on how short sighted and quarterly driven the business is of course…)
Loota yes, Labour should have cut the taxes during their many years of surpluses instead of waiting until 2008 in a feeble attempt to stop the outgoing tide…
Now we are at a crossroads where they are desperately needed, but the financial viability of doing so is more contentious.
However, considering that those in the higher incomes tend to generate more growth and spend more then it make sense to not tax them until they join the queue at the foodbanks.
John Roughan’s article in the Herald a while back was quite interesting. He noted that too that most of the tax in this country is paid by those on above average salaries who are taxed under the PAYE system – including our teachers.
He also pointed out that 40% of New Zealanders effectively pay no tax thanks to WFF.
Everything I have found this morning points to how 8% of us are paying 76% of the taxes.
They all quote various sources (mainly research articles), but I am not sure where to find the exact figures on IRD….have found plenty of information on the cost of smoking in this country though!
“Labour should have cut the taxes during their many years of surpluses instead of waiting until 2008 in a feeble attempt to stop the outgoing tide…” – Yeah that would’ve thrown us deep into the world wide recession, oh joy
Yes because using the hard earned wages of the so-called rich to pay off our debt instead of giving them the ability to spend, save and manage their own money clearly kept us out of the recession!
We were better off than we would’ve been
48.7% of us thought otherwise….
“48.7% of us thought otherwise….”
If you get told something enough times it sounds convincing. That is what has been happening in this country in recent years. Certain elements push the idea of a low-tax, booming economy which will enable all New Zealanders to benefit. This is a crock, and demonstratably false. It would be cynical to say that it is purely greed that has led to these elements of society pushing these ideas, but I am feeling mighty cynical these days. To be fair maybe some people honestly believe neo-liberal theory, then they are just plain foolish rather than greedy.
Telling hard-working New Zealanders that the only reason their standard of life isn’t as good as they would like is because of a high-tax, large government, society first approach is just plain exploitation. This group is using the middle/working class as a proxy to make changes that will only benefit a small minority. Just because this message worked for them doesn’t mean its right or inherently true.
Perhaps Andrew however, taxation exists to finance public goods/services and in NZ’s case, welfare (safety net only). The government should only be collecting what it needs to finance those activities. Anything more is theft.
Lower tax rate translates into a higher disposable income which means more money to spend on the mortgage, kids, house repairs & savings for our retirement.
“anything more is theft”
So if you disagree with someone’s definition of a public good, then they are a thief for ’stealing’ your money? By throwing out a slogan like ’safety net only’ you are simply creating a smokescreen and a paradigm in which people struggling in the short or long term are bludgers if they don’t fit into a certain framework, they are ’stealing’ from New Zealanders. What is a safety net? Does this include help seeking a job? Creating opportunities for those not blessed with perfect physical or mental health? Where does the idea of society and community sit in all of this? Is the betterment of society and an increased standard of life for all New Zealanders not a public good? Maybe the problem is not simply a choice between high-tax/low tax, more intervention/less intervention, but a fundamental need for a shift in thinking. For one thing paying tax does not equal a net loss to you or me, or anyone on this blog.
Responding to Rebecca at 10:50am It is very unfortunate but you did not understand what I said.
Moving on; facts is what we have thay are the truth. I wrote about facts they are emprirical evidence rather then feelings.
It is so often said that when one does not understand, the best form of defence is attack and that is what you did to my comment.
It is indeed sad they you are so full of the “cult of positivism” that you cannot discern reality from your feelings.
Another historicl fact is that The Labour-Alliance/Progressive government inherited a nightmare of a broken economy from National in 1999. Over the Clark-Anderton years many many things improved, but the people were hoodwinked into believing they would get more with National.This being done through a Crosby Textor marketing campaign. Thus the job of improving NZ through policies of The Labour-Progressive government remains incomplete.
Look at the mess now, the beginnings of the export of New Zealand’s money and sovereignty
In 2011 when the people finally realise that The Emperor has actually got no clothes on, that is the teflon shield has been broken around Smile and Wave the people will vote in the progressive Labour Party. You and many others will become cognisant of the actual economic nightmare NACT created and the processes needed to recover from that!
Prevention goes along way!
I’m an accountant I need numbers to see what the proposed rates will do and assuming you spend $15,000 a year to live (and pay GST on that $15,000) and the top tax rate gets reduced to 33% then the following are the effective tax rates now being proposed:
Income 12.5% GST 15% GST 17.5% GST
$14,000 26% 29% 31%
$48,000 22% 23% 24%
$70,000 26% 26% 27%
$100,0000 28% 28% 29%
This doesn’t take into account welfare but as you can see the effective tax rate for someone earning $14,000 is higher than someone earning $100,000. And I don’t think that is fair.
PS: Rebecca lower taxes means you have to spend more money on private health care, education, private security, retirement, lawyers, toll roads and a reduction in other public services. AND you don’t get efficiencies of scale because you only buy a little bit at a time where the government buys these services in bulk.
When posting my comment spaces were removed from the percentages
Well the Labour-Progressive Government was distracted with a lot of things not to do with creating a high value added advanced industrial and advanced services based economy able to sell to the world. Basically it wasn’t important enough to focus on for any length of time and that’s what is needed in this field: continuous, unflinching focus over years and years and years. That’s tough when most MPs and most public servants struggle to think longer term than one parliamentary term.
@ Rebecca: I think that Government can and needs to do a darn sight more to help NZ get rich than provide the very short list of basic public services you describe.
And it is going to cost a tonne of tax money to do it, full stop.
Investing in and encouraging the development of high tech and advanced services industries is very expensive and time consuming. It will cost a large amount of tax dollars in incentives, tax breaks and direct subsidies.
Get used to it because if it is done right and this economy becomes an advanced wealthy economy you will have your lower taxes and you will have your better services, and so will your children.
Your low taxes won’t have to come with the compromise of corners being cut on the basics needed by you and your community.
In the trade its what they call “having your cake and eating it too”.
Thanks Gary for putting that partial transcript up. You know when you have drawn blood when the Minister of Finance issues a ridiculous rant of a made up press release to counter it! Any observer could see that I duly noted value-for-money, but drove home the point that we need to go deeper with the diagnosis of our economic ills. Only with logic and evidence can we take the steps we need to take to turn this economy around – and believe me we don’t have long before it is too late. I stand by every word on RNZ.
I want to thank all involved for an excellent debate – no doubt we are just scratching the surface of what NZ really needs to get ahead. I want us to get beyond sound bites and slogans and partisanship to actually have a community-wide dialogue about what our shared vision is for the longer term.
Of course John key is teflon slick – so would you be with the best polling and presentation advice money can buy. But that is no substitute for doing the right thing for the country, rather than for your own polling.
National is a map without a compass. A ship without a rudder. A tactician without a strategist. Short term poll success, long term disaster for NZ.
Do you want to wake up almost entirely foreign owned, a wage slave for someone else? Want your bright kids to live offshore? Want to see our unique national identity follow our economic sovereignty down the triple-deficit plughole? Fine. Take your upper income tax cut and keep right on the track your are on.
Want to change course? Think about it.
@ David, nice work, wrt to the possible future scenario of NZ that is the punchiest and most to the point summation of the situation that I have heard yet. This is the kind of messaging that needs to get out there.
My mate Walshy Out West said that you know what you are on about.
This country is slowly sliding sideways into the nightmare situation you have described, ignoring it by borrowing and borrowing, and a lot of smart people can see the writing on the wall plain as day. Hence they have left NZ already, their kids have, their GPs have or they are just working on gaming the system and the good life while they still can – even if their activities today do nothing to add to the country’s economic wealth just their own. (The two are not necessarily one and the same thing of course).
NZ needs to be able to earn hard foreign currency through advanced goods and services, lots of it, and to be able to keep that capital on our shores to help our people, our communities and our economy.
The Nats win their points by encouraging people to think short term and expediently. Labour has a much harder job.
But it is worth stealing that approach from them and then packing in the detail of the complete package with Labour driven values and Labour driven detail.
Oh I see what you mean…and I quote:
“Labour is in cloud cuckoo land by ignoring our significant debt problem – a problem of Labour’s own making. We actually face another six years of Budget deficits, which this Government is working hard to turn around.
“Furthermore, New Zealand’s habit of spending more than it earns has accelerated in the past five years.
“Our total external debt – including households, businesses and the Government – has ballooned from $90 billion to about $170 billion since 2000. This is forecast to approach $250 billion by 2014.
“This is clearly New Zealand’s single biggest vulnerability.
“No amount of cosmetic surgery can hide the fact that Labour’s reckless economic policies are stuck in the past. There is no evidence of fresh thinking – in fact, precisely the opposite is true when their answer is to saddle future generations of New Zealanders with more debt.”
http://www.beehive.govt.nz/release/labour+confirms+multi-billion+dollar+debt+binge
Excellent impassioned rant David
I totally agree- we have very little time left. If you are serious about saving what is left of this country then Labour needs to get its act together, present some vision and policy that is more than the familiar old knee jerk, neoliberal, sell anything for a quick buck stuff. And then win the next election.
About tax- Labour did the wrong thing by not attending to bracket creep in the top tax band. You ended up catching too many teachers, nurses, civil servants etc- people who tend to vote for the left but are not wealthy at all. It has alienated some of your support base and made it easy for National to do away with that top rate almost all together. Middle NZ won’t get anything much from the tax cuts- the richest will of course benefit the most- but some are so angry out there that they will take the pennies and thumb their noses at Labour.This could have been avoided.
@ Jane: yep avoidable self inflicted injuries are the most painful.
Hi Loota
you asked Of the 8% that pay 76% of this country’s taxes (including WFF), how many actually earn over $100k or $150k?
Does any one know what proportion of income that 8% earn? Is it over or under 76%?
Appox 9% kiwis pay top rate tax. Many of these will be teachers and nurses at the top of the pay scale (with a management point or with overtime). None of the teachers or nurses I know are rich! I don’t mind paying tax, but I do mind when it seems that I work a far greater proportion of the year for free!
Oh dear – we seem to be having the same debate around this tax issue – David, what I want to know is:
- What amount of money/earnings do you consider make a family ‘rich’?
I have said before (and here I go banging on about it again – so sorry) that those of us that in the professional brackets (education, nurses etc) that are taxed at the top rate or see us slip into the top rate, are not rich – and have very little extra cash left over.
It was one of the reasons that droves of middle new zealand (right or wrong) went off to the nats – I am with Fred – I also will only vote on the left – but like Rebecca/emma etc point out – its not ok to ignore what middle nz is worried about – because I do believe that most kiwis are quite happy to support other kiwis and live in a fairer, better society – but sometimes it does feel like you keep getting punished over and over. IT makes it hard to be happy about it. The loopholes need to be fixed – and I would love to know what amount makes you rich. Will anyone in Lab be able to clarify this once and for all?
Hi Emma,
Isn’t this where a progressive tax system is fairer? If you are on $80,000 yes you’re hardly wealthy, but also your tax for the year goes up just $500 compared to if you were just on the basic 33% rate for the whole amount.
OK I say “just” and of course, having $500 more in the pocket would always be handy but its not money which is going to make any memorable lifestyle difference.
So having worked it out on Windows calculator, that extra 5c tax on the last $10K income you earn over $70K is equivalent to an increased tax rate of only 0.6% over an entire salary of $80,000 p.a.
0.6% = meh, is this what all this heartburn is over?
Its not really going to make you work much more in a year “for free is it”? On a 2080 hour work year, it comes to about an extra 13 hours and 10 minutes more “worked for free” each year, for someone on $80K p.a.
(Of course if you are on $120K a year, a larger proportion of your income will be hit at the top rate, but then…that’s an income enough to do OK on and not really a common senior teachers/nurses salary).
I do wish we could move on to leading the country (where? is the question) instead of arguing over a cent or fractions of a cent in the dollar.
BTW…I hit the top tax rate too, so it gets me like so so many people in NZ
What I find sad about this blog is the comparison contest between one and other as to richness.
It seems, under Labour, if you earn more than someone else you are scum? How does that work?
Surely, Labour is about raising everyonees standard of living and delivering equality? If that is not what Labour stands for what does Labour stand for? David?
So robin hood in reverse is wrong, but robin hood the other way is OK? Why? Hypocrisy?
Dave: Robin Hood in reverse is wrong for a very simple reason. It makes you the Sheriff of Helensville/dang I meant Sheriff of Nottingham.
I notice a few slaveminded defenders of unfettered crony capitalism stating that the rich pay most of the taxes due to those on lower incomes getting taxes back via working for families. Like most things said to tilt the table, it is very gross generalist, working on the ground out here with many two income families, in many cases much of the wifes income goes on child support, even after child support subsidies, it all goes round in the wash.
Go to treasury website -tax facts- you will observe much of the stable tax base comes from 55% paid by those earning 30,000 – 90,000, 26% by those earning 100,000+ , sure most historical tax tables around the world will show an increasing disparity of of tax paid by the increasing wealthy, but emperical evidence also shows that it doesn’t match the historical disparity of incomes when hidden income of the wealthy is taken into account.
Much like historical evidence shows that under the current private designed and controlled monetary system, growth has never over the longterm exceeded the cost of credit borrowed to create it, because it is by mathematical formula physically impossible.
Godber,
I have no problem with someone earning twice as much as the next person, as long as they have produced twice as much, worked twice as hard etc, I have a problem with those who are able to create credit out of freshair, loan more of it out at interest than their is the collective ability of repayment, then use the interest proceeds and boom bust cycles to monopolise the necessities of life of those who don’t have such wonderful tools.
It is the charging of interest on the credit money base that makes the system inflationary by design, then drives everyone into the hands of the casino owner as they takes risks in investing their money to keep up with the inheirent inflation so the money they earned yesterday is not worthless tommorrow.
I am a top rate taxpayer. All my income sources make me around $200K a year. I’ve never felt more under attack than now. By National. David’s last post was on the money. I want this ship turned around.