I've been reading lots of economics news articles lately. I think Dan Denning writes well, and I like his analyses and commentary. I was really glad to read this question at the end of his most recent article:
Meanwhile, the government continues its public relations war against the mining industry. You have to wonder what the government hopes to win by trashing the industry in front of international investors like this. The obvious answer is: money!
To be fair, whether production or profits should be taxed is an interesting question. And whether a tax or royalty should be levelled as the state or Federal level is also an interesting questions. By "interesting" we mean debateable if you accept at face value the government's right to tax private enterprise. We're not saying we like it.
But this line of attack that, "the community has not received a fair return for its non-renewable resources during boom times" is a bit rich, isn't it? This again presumes that it is the community which owns Australia's mineral resources. Does it?
If you accept that argument, then it follows that the community owns every kind of national resource, not just land and property but labour and intellectual capital too. If the government is entitled to tax the mining industry for what it believes to be unfair profits, why not the banks? Why not any kind of activity which policy makers determine is not providing its "fair share?"
for The Daily Reckoning Australia