[LINK] Re: OFF TOPIC Re: the rich and corporate parasites

Chirgwin, Richard Richard.Chirgwin@informa.com.au
Wed, 26 Feb 2003 13:06:49 +1000


Hmmm. Australia is very good at discovering economic miracles just as the
wind starts to fade. Ireland is suffering IT closedowns just like everyone
else ... HP/Compaq, I think, as well as Tellabs, Gateway, Damovo, and I
suppose others I didn't notice at the time.

Even when it was working, there was a lot more to Ireland's achievements
than "look, they cut tax and it worked!" Note, for eg, that a greater
willingness to locate in Ireland co-incided with more stable politics and
the waning of sectarian violence (which could still spike everything if it
blew up again).

The tax argument makes people feel nice and warm; but using low tax to
foster external dependency is no better an idea than using high tariffs to
foster internal dependency. 

As for criticisms of Australia's farm-and-quarry mentality; fair enough, but
then again had we believed what "The New Economy" taught, we could just as
easily have followed the US down the dotcom drain; with much less capacity
to absorb the loss.

Science is grossly undervalued; but there's no causal relationship between
universal healthcare and CSIRO funding. Turn it around: when healthcare was
better funded, CSIRO was better funded. The evils of socialism again, I
suppose?

The truth is that extremes are to be avoided. Extremes of social benefit are
unsustainably costly. Extremes of lassaize faire (sp?) are unsustainable in
other ways. The trick is finding a middle ground that works in the very long
term.

Richard Chirgwin

> -----Original Message-----
> From: Deus Ex Machina [mailto:vicc@cia.com.au]
> Sent: Wednesday, 26 February 2003 11:23
> To: link@anu.edu.au
> Subject: [LINK] Re: OFF TOPIC Re: the rich and corporate parasites
> 
> 
> Chris Maltby [chris@sw.oz.au] wrote:
> > On Wed, Feb 26, 2003 at 08:00:38AM +1100, Deus Ex Machina wrote:
> > > (as if its not a tautology) the irish case clearly shows 
> that business
> > > is the driving force behind the economy.  Ireland halved 
> its tax rates
> > > more or less and more or less doubled its tax income.
> > 
> > The Irish case is a classic example of not including externalities.
> > The extra revenue came from companies relocating their incorporation
> > to Ireland to take advantage of the lower tax rates. Some of that
> > turned into increased economic activity, but some of it was just
> > tax avoidance in another jurisdiction...
> > 
> > In another version of the story it's called "the tragedy of 
> the commons".
> 
> "blaming" the irish economic miracle on foreign investment is 
> only part of the picture
> see
> 
> http://www.csls.ca/ipm3/fortin-un-e.pdf
> 
> it cant be understressed that unemployment went from 16% to 
> under 5%, I dont see
> how that is a tragedy, further by investing in higher 
> education ireland has/is creating
> an infinite resource of intelectual capital. contrast with 
> australia with HECS and
> its mentality of being a farm and a quarry. our government is 
> too busy proping
> up a ill functioning health care system and subsidising 
> private health insurance to worry
> about creating free education.
> 
> Vic
> 
> 
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