Greens’ Perpetual money machine

Caption: Richard Di Natale announces the Greens’ economic policies

When I was a boy, I once hit upon what seemed to me then to be a brilliant idea that would provide boundless energy.

The basic concept, as I explicated via some very imaginative drawings, was to connect a motor to a generator. Once an initial kickstart had set the motor running, the impetus from the motor would turn a generator, whose output would be fed back to the motor, keeping it spinning in perpetuity.

Brilliant!

My dreams of a free-energy future were quickly shattered by my eldest brother, though, as he patiently explained that the basic laws of physics were agin me: friction, resistance, heat loss, would all mean that the energy returned by the generator would always be less than input by the motor. What I was proposing, he said, was a perpetual-motion machine, a perennial pipe-dream of crackpots and snake-oil salesmen.

So, I gave up that idea and went back to designing spaceships instead.

The Australian Greens haven’t gone so far as proposing perpetual-motion machines as renewable energy (yet), but leader Richard Di Natale this week announced a policy that’s a near-run in foolishness. Quote:

Greens leader Richard Di ­Natale’s policy to abolish all existing welfare and introduce a “universal basic income” — a non-means-tested payment to all citizens — would require federal public spending to rise by $254 billion a year, or by almost 55 per cent.

The policy Senator Di Natale yesterday touted as a “bold move toward equality” drew scorn from policy experts. End of Quote:

Not that any of that matters to Greens voters infatuated with socialist dreams. After all – free moneyQuote:

Social researcher Ben Phillips — who modelled for The Australian the cost of paying all residents aged 15 and over $23,000 a year (the Age Pension) and children $5500 a year (the maximum rate of Family Tax Benefit A) — said the plan was “utopian”. On his analysis, all marginal income tax rates, including the current zero-rate on incomes up to $18,200, would need to rise by 33 percentage points to pay for the proposal, bringing the top rate on incomes above $180,000 to 78 per cent. End of Quote:

I once asked a proponent of Universal Basic Income (UBI) just where the money would come from. “Oh, that’s easy,” he said. “Everyone pays tax on their UBI, which goes back into the system.” An economic perpetual-motion machine, in other words. Quote:

“One of the claims of UBI ­advocates is that they remove the high effective marginal tax rate,” Mr Phillips said. “To some extent that’s true but the majority of taxpayers move to even higher effective rates.”

Peter Whiteford, social security expert at the ANU, said…”paying the pension to everyone would be relatively more expensive than in any other country…You would probably need a constant income tax rate without a threshold of between 50 and 60 per cent.” End of Quote.

Who cares what those party-pooping bean-counters have to say? As Jack Nicholson’s Joker said, Who do you trust? Hubba, hubba, hubba! Money, money, money! Who do you trust? Me? I’m giving away free money!

But Di Natale wasn’t finished with the rainbows and unicorns: his other major policy proposal was good, old socialist revisionism. Quote:

Economists criticised the Greens’ other proposal announced in the same speech: to create a government-owned people’s bank that would offer discount home loans and basic deposit services.

Peter Jonson, a former Reserve Bank chief economist, said the idea was “absolute rubbish”. End of quote.

With the short and selective memory so typical of socialists, Di Natale also seems to have forgotten the critical role that government-owned banks doling out cheap home loans played in the Global Financial Crisis.

My fellow Tasmanian, economist Saul Eslake, was blunt in his assessment: Quote:

“[it’s] a pretty dopey idea, even if you ignore the Orwellian overtones in the name”. End of Quote.

Dopey? Orwellian? Sounds very, very Green indeed.

 


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Who is Lushington D. Brady?

Well, a pseudonym. Obviously.

But the name Lushington Dalrymple Brady has been chosen carefully. Not only for the sum of its overall mien of seedy gentility, reminiscent perhaps of a slightly disreputable gentlemen of letters, but also for its parts, each of which borrows from the name of a Vandemonian of more-or-less fame (or notoriety) who represents some admirable quality which will hopefully animate the persona of Lushington D. Brady.

To read my previous articles click on my name in blue.

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