Economic Inequality [S1-07]

Show Notes

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Music: “Insurrection”
Written by Pierre Chrétien
Performed by the Soul Jazz Orchestra
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Transcript

Callum Sinclair

Welcome to Why Can’t They Just, looking at politics, policy and getting stuff done. My name is Callum Sinclair. I’m a Labor Member and joining me is Janaline Oh.

Janaline Oh

Hi I’m Janaline Oh. I’m also a member of the Labor Party and before I start, I’d like to acknowledge that Callum and I are both recording this on the lands of First Nations people in Australia and I’d like to pay our respects to their elders, past and present and also extend those respects to First Nations peoples listening to this podcast.

Callum Sinclair
We’re recording on the 5th of October 2025. And for a while, there’s been a lot of discussion of inequality, the housing crisis and the problems of rising inequality in Australia, so I’ll just start off. Is inequality rising in Australia and how do we know that? Or is it just that there are more stories that are reaching people about inequality that already existed?

Janaline Oh
Yeah, I actually don’t know. I don’t have any kind of objective research to say that inequality is rising in Australia. I haven’t seen an estimate of the Gini coefficient for Australia for quite some time. So the Gini coefficient is a measure of inequality. Zero is perfectly equal, which means every single person in a particular group has exactly the same resources, and one is perfectly unequal where one person has all the resources and everybody else has nothing.

Australia’s Gini coefficient through the 1980s and 1990s was around 0.35 to 0.37, so moderately unequal but not outrageous. I don’t know what the number is now. I think the top 5% has been earning an increasing share. So income and wealth are slightly different, but the top 1% of Australia’s wealthiest people have more wealth than the bottom half, but again, I would probably need to be fact checked on that. But I think again that is a number that has been rising. So I guess those two measures would indicate that inequality is rising in Australia.

And I think people are feeling like inequality is rising because you hear about sort of massive CEO payouts. You know multi-million dollar bonuses for people at companies that haven’t even particularly been doing well, while a lot of people are really struggling. I guess that’s a very long winded way of saying I don’t actually know.

Callum Sinclair
But there’s definitely a sense that inequality is rising and, if inequality is rising, how do we know that this is the cause of a lot of people’s distress in terms of housing and the housing crisis? So is the crisis in housing one of there not being enough homes, or are we in an affordability crisis? Is it just that a few people own many more homes, they get to dictate the price a bit more, and so the price has gone up while their homes remain vacant.

Janaline Oh
Yeah, that’s an interesting question. I think it’s probably a bit of both. I think there is a supply shortage just because we haven’t been building houses at the rate that our population growth would suggest we need to, and also because the number of people per household in Australia has fallen in the last few years.

There are all sorts of factoids out there, which would suggest that we don’t have a supply problem; we have a kind of allocation or affordability problem, such as in the census. I think something like a million homes were listed as not being occupied. I think that is actually a bit misleading because that is a snapshot of one night. And there would have been people who weren’t at home because they were visiting someone or because they were on holidays. There would have been holiday homes that weren’t being occupied at that moment. There would have been homes that weren’t occupied because they were being renovated or because they were between tenants or they’d just recently been sold.

So I think it is misleading to take that one census figure and extrapolate from that. Oh, but there’s a million vacant homes, so therefore there shouldn’t be a supply problem.

That said, I think there is also an affordability and an allocation problem. I think it is also true that houses are becoming more unaffordable, partly because it’s quite costly to sell your home and buy another home. And the reason for that is because most, I think all, state governments still charge a thing called stamp duty, which is a pretty significant tax on the transaction of buying and selling a house. The ACT is phasing this out and they’re replacing it with a broad based land tax, which economists generally think is more efficient because it makes it less costly to move houses and more costly to own more expensive properties, which seems fairer.

But you know, in a lot of places, people are staying in, you know, four or five bedroom homes long after their families have moved out. And many of them would like to move into a smaller place, but there’s stamp duty. There’s the issue that in a lot of established suburbs where these people are living, there aren’t a lot of downsize options.

In a lot of established suburbs, there aren’t smaller townhouses or apartments that, for example, an older couple whose family have left, can move into, and perhaps still have a spare bedroom for the grandchildren. This is one thing that I think a number of governments around Australia are trying to address and there have been changes to planning laws in NSW, Victoria, I think South Australia and the ACT to make it easier to build slightly higher density properties in established areas and that might help to address that problem a little bit so that people can actually move from, you know, their giant family home and make way for another family to move in, and then downsize, but still stay in their neighbourhood where their friends are, where their shops are, where their hairdresser is, all of those things so I think that’s part of the issue.

This is quite a complex economic area. I don’t think you can just say, oh, there’s a few people who just own all the assets and they’re stopping other people from getting them.

In Australia, more than half of people who own investment properties only own one. About another 20-25% own two. And then the remaining 25% own squillions like you know own multiple, like really a lot. Some of those are companies, some of those are like developers who just own lots of properties that they rent.

Some of them are individuals who just have very, very large property portfolios and I guess that is an area that is an area that would seem to lend itself to a bit of tax reform to reduce the incentives for owning multiple properties, and free up those properties for owner occupiers.

But, having said that, there’s no evidence that people are hoarding properties. There’s no evidence that I’ve seen that these people who own multiple properties are just sitting on them, having them vacant, because that is also quite costly, because even if you are claiming tax benefits, properties are pretty costly; rates are costly, land taxes are costly. It doesn’t really make sense not to earn rent if you can earn rent.

So I’m not convinced that tax changes would free up a lot of supply or even make properties more affordable. It’s not clear to me that those things are connected.

I think it’s not a bad thing to have tax reform. But the main reason I think it’s a good thing to have tax reform: there’s two reasons. One is that it is very costly to the budget. Those tax refunds cost a lot. If we weren’t so generous with the tax refunds, we would have more money available for things like You know, disability and Medicare and …

Callum Sinclair

Defence.

Janaline Oh

… services that people like

Callum Sinclair

Sure.

Janaline Oh

And defence, which is a service that most people don’t particularly like but have to put up with.

The other reason is that they really make property investment much more attractive than other forms of investment. And if we made property investment less attractive, then hopefully people would put less of their investment money in real estate and more of their investment money in actual productive enterprises, so actual companies that make goods and services, and that would increase productivity in the economy. So those are two reasons that I would support tax reform.

Callum Sinclair
So you think tax reform wouldn’t necessarily release a lot of open supply, but would change where investment is heading instead of putting it in a house. You think that more investors would put that into new businesses.

Janaline Oh

Hopefully they would, because the relative benefits of investing in a house, like to rent out, against investing in a business, would change. So at the moment it’s very, very advantageous to invest in real estate and rent it out because you get these massive tax concessions. And you don’t get those tax concessions from investing in a business. If you change that calculation, hopefully at least some of those investors would sell those properties and invest their money in shares or in companies or productive businesses. And hopefully that would then free up those properties to be sold to people who actually want to live in them.

Callum Sinclair

Is land tax just used to pay for the services of a council? Are they also used to pay for the costs of running services? Are they also used to pay for things like healthcare or other services in a State or are they just for bin collection?

Janaline Oh

Right. So there’s two different types of land tax. One is council rates, which are collected by local councils for things like bin collection. I mean, I don’t want to be unfair to local councils. They actually manage a lot of stuff. They manage parking. They manage planning. They manage, I don’t know, shopping centres; they manage a lot of stuff. It’s not just bin collection. And having said that, bin collection is really important and anywhere where there has been a bin strike for more than two weeks will tell you that bin collection is actually a really important service.

Anyway, I digress. Increasingly States are introducing State-based land taxes, at least on investment properties and those taxes go into State revenue. So they are used to fund schools and hospitals and you know infrastructure and the stuff that State governments provide.

I’m pretty sure all States still have stamp duty. There’s been a big push driven from academic economists to shift from stamp duties, which create barriers to people moving, and that’s very inefficient because it means that resources are tied up by people who don’t want them and therefore not available to people who need them, to land taxes, which are much more efficient, so land tax is just a tax on the value of your property.

Callum Sinclair
Sure, whereas stamp duty is a charge on the transaction cost of selling a property. Is there also an equivalent for shareholding?

Janaline Oh
So for stocks and shares, there are taxes on transactions.

Callum Sinclair
But not on just ownership.

Janaline Oh

No, you don’t get taxed for just owning shares. But you do get taxed for dividends and you do get taxed if you sell those shares and you’ve made a capital gain on them.

Callum Sinclair
But the dividend tax is just calculated as part of your income.

Janaline Oh

Which you know I think makes sense. I mean one of the most controversial taxes in the property space is the capital gains tax concession for real estate. Under the rules, if I own a bunch of shares and I sell them and I make a significant capital gain, then that gain gets added to my income, and then I’ll get taxed on it as part of my income.

If instead of a bunch of shares, I owned a property and I bought it for $500,000 and more than one year later, I sell it for a million dollars, that $500,000 doesn’t just get added to my income. It gets halved and then added to my income. So what that means is that if I bought $500,000 worth of shares and then sold them a few years later for a million dollars, I would pay tax on that $500,000 as if it was just additional income. If it was a property, I would only pay tax on $250,000 of that $500,000. So basically half of it would be tax free, and that is actually one of the key things that makes property investment so much more attractive than other types of investment. And I think that is enough to be distortionary.

Callum Sinclair
Sure. There are other ideas like changes to the tax system to try and address inequality. One of those would be an increase to the GST and then taking that money and reimbursing it to people who are disadvantaged in some way. That seems to be a tax mostly on middle income earners because the most transactions are done by those people because there’s lots of them and they have enough money to spend. It seems to be an increase in tax on the middle class to subsidise the very disenfranchised. That’s one tax that’s being discussed out there. Another one is a wealth tax, which is a tax on assets held by a person over a certain threshold.

Janaline Oh
They don’t have to exist as mutually exclusive is the first thing I’d say.

Callum Sinclair
Sure.

Janaline Oh
I think there are arguments for both. My favourite argument for increasing the GST and then redistributing it back through either income tax cuts, or welfare transfers, or both, is that the GST is the one tax that rich people cannot avoid. So however clever your accountant is, you can’t avoid the GST. If you buy a thing, you’re paying GST. So in that respect, it’s very efficient.

Various bits of research have shown that consumption taxes are very efficient in the sense that they don’t significantly change behaviour. One of the issues with designing a tax system is that if you have high taxes on a thing and not on another thing, you can actually distort people’s behaviour. This was the issue with the tax concessions on property, that the way in which they’re structured means that people invest more in property and less in other stuff because of the taxes. So they’re very, very inefficient.

I don’t think a consumption tax - if it’s a broad based consumption tax - I don’t think it’s going to stop people from using goods and services, particularly if poorer people get compensated.

So, there are two ways in which an increased consumption tax can be designed to compensate poorer people. One is a direct transfer, so you collect more GST, but you increase your welfare payments by as much, or probably slightly more to compensate for that, and you probably also introduce a low and middle income tax offset, again to compensate lower and middle income earners for those rising prices.

It’s true that upper middle income earners will probably pay the bulk of that, but so will the very wealthy. And if in addition to that, you have a significant increase in the tax on luxury goods, that will also tend to tax the wealthier people in society.

So no tax is going to be perfect, but I think that is a way of making a rise in the consumption tax fairer.

The other benefit of that is, if you can generate more tax income, then you can have better government services and the people who benefit the most from good government services are obviously poorer people. So if you have a really good Medicare system and you can get yourself to a point where people don’t have to pay massive out of pocket expenses for tests and specialists and things that they do currently have to pay out of pocket for, then it’s poorer people who are going to benefit from that, because they will be able to get access to services that they can’t easily get now.

So I think that is one argument for having an increase that is broad based. And also because you can collect a lot of tax, because consumption taxes affect everybody. So you have a very, very large number of people paying a small amount more.

The issue with wealth taxes is that in order to collect enough money to make it worthwhile, either you have to set the threshold relatively low, in which case you’re still pinging your upper middle income earners, or you have to make the tax really quite high and quite punitive.

And if you do that, then sadly, those wealthy people have options, and it is not that hard for them to move their assets overseas or to organise their affairs so that they don’t pay that much tax. I mean France cancelled its wealth tax not that long ago, partly because it just wasn’t collecting enough.

Callum Sinclair

Sure, but doesn’t that mean that it drives down asset prices in your country? Isn’t that a good thing?

Janaline Oh

Well, it depends on what you’re taxing, but it doesn’t necessarily mean that. It could mean that instead of holding the asset in their name as a resident of your country, they distribute it to a number of people so they come under the wealth tax threshold, or they organise to put it through some complicated company structure.

So I guess my point with wealth taxes is that if you set them high enough to collect a reasonable amount of money, there is a significant risk that it’s going to be worth it for those people to pay a lot of money to clever accountants to avoid it.

If you had a modest wealth tax on very significant asset holdings, that is a reasonable thing to do, but it’s a matter of setting that level and setting the thresholds at a point where you maximise the amount of tax that you’re actually going to collect. As I said, I don’t think these are either or propositions. I think you can actually have both. And I think one of the most efficient forms of tax, which is actually one of the best ways of tackling inequality through the taxation system, is to have an inheritance tax.

You know, the Economist newspaper recently ran an issue about inherited wealth and what they found was that the best determinant of whether you are wealthy at the moment is whether your parents were wealthy. And that is actually quite different to even two generations ago.

This is really problematic. Because it means that basically we’re moving away from a system of equality of opportunity to a system of inherited opportunity.

Callum Sinclair
Strikes at the heart of meritocracy.

Janaline Oh

It does absolutely strike at the heart of meritocracy. It’s anti meritocratic because it basically says if you were born into a rich family, you’re going to be rich. If you weren’t, your chances of becoming rich are much less now than they were two generations ago.

I think if we assume that intelligence and ability and talent and innovative capacity through the economy is not concentrated in the wealthiest, it’s also very unproductive because it means that a lot of people are not reaching their potential, and a lot of very mediocre people are potentially in control of a lot of assets and decision making.

So I’m a huge fan of inheritance tax. Australia had inheritance taxes at a State level until the 1980s, when Queensland decided to abolish theirs. And what happened then was there was a massive migration of older people to Queensland, where they didn’t have to pay inheritance tax and the other States responded by doing, effectively, a race to the bottom.

Callum Sinclair

Yeah.

Janaline Oh

I think there is a really good case for a federal inheritance tax. Having said that, you know, we saw the ads on death taxes against Labor in 2019 when Labor wasn’t even proposing anything of the sort.

So the problem with inheritance taxes is that they are weirdly unpopular. And I say weirdly, because mostly, in most countries, inheritance taxes don’t kick in until you are already very, very wealthy.

Callum Sinclair

Sure.

Janaline Oh

You know, I think in Britain it’s something like, you know, £40 million.

Callum Sinclair

But in Britain, I thought that the inheritance tax system was basically dead. Now no longer does anyone inherit everything - anything. That mostly there are just trust funds and trusts that people become controllers of. And that’s not apparently inheritance.

Janaline Oh

This is where I come to my point about how the wealthy can organise themselves to avoid taxes they don’t want to pay. But I think, yeah, I think you’re probably right. But I guess my point is that, even though those taxes are set at a really high level, people, like normal people who will never in their wildest dreams ever pay those taxes, still don’t like them. And I don’t quite understand why.

And it’s not just an aspiration thing, right? It’s not just because you sort of think, oh, maybe I will, I don’t know, win the lottery, get some amazing job, find some terrific invention, I don’t know, become Taylor Swift.

It’s also in places like Britain where the inheritance tax was effectively paid by the landed aristocracy, so a class of people that you just couldn’t enter, they were still really unpopular. I don’t understand that. But I think the Government that can crack that political problem, you know, has a very good opportunity to deal with both revenue and inequality.

Callum Sinclair

Why not just tax assets? Why not say this is an asset, someone has to cough up a percentage of its value, and if it can’t be accounted for, then it can be sold off and owned by someone else.

Janaline Oh

I don’t have a problem with asset taxes. I think there are various ways in which you can tax assets. Making trust fund beneficiaries public is a good idea. Changing the tax arrangements for trust funds is a really good idea. I do not understand why people can set up trust funds and basically not get taxed on them. I think that would be a very good way of dealing with hidden assets. I think taxing real estate is a really good idea. I think broad based land taxes based on the value of a property are a very good idea, because basically you pay tax when your property is worth more.

People will argue that, you know, if you’re like a pensioner who’s living in a family home whose value has, you know, gone up just because the property market has, not because you’re rich, you won’t be able to pay that tax.

I think there are ways of dealing with that. And in any case, I think it’s going to take a lot for any government to start putting land taxes on family homes. Most taxation schemes for land tax exclude your principal place of residence. If you do that, you don’t have that issue. But if you do that and you also get rid of stamp duty, you make it easier for someone to sell their principal place of residence and move into another one. And the beauty of limiting things to a principal place of residence is that you can only have one. So there is a real limit to how much you can game a system like that.

I think taxes, land taxes and property taxes on real estate are generally a pretty good idea. I think when you’re talking about shares, because they are so liquid, I think it makes sense to tax transactions and to tax income rather than necessarily the asset itself, just because of the nature of the asset.

I think taxing assets is actually a smart thing to do. The way in which wealth taxes are talked about and structured, it’s not specifically taxing an asset, it’s taxing your entire portfolio of assets. So it’s saying if you have assets worth, I don’t know, $100 million a year, then you have to pay $2 million a year in tax on that entire portfolio. And I think that is where you start getting people gaming the system. If the way in which you tax stuff is to say, well on the $10 million holiday home, that is not your principal place of residence, you have to pay 2% a year, then that’s harder to game.

Callum Sinclair

There are two other games that I’ve heard of, which is, one, a company makes a profit in Australia and then claims that - they claim that they’ve never made a profit in Australia at all. A great example is Uber. Uber, apparently, while becoming the biggest taxi service, apparently, it’s never made a dime in Australia, and that sort of licensing fees for the use of software and logos is so expensive. But apparently the people who own Uber in Australia are perfectly happy to pay that to whatever company somewhere else.

Is that a solvable issue? Can we just target countries which are allowing that kind of thing to go on and say, well, you can’t buy any goods from that country because like for example Ireland or Switzerland, we’re not getting many actual goods and services from those places. So why allow notional goods like these logos to come from there?

Janaline Oh

I do have a problem with just kind of saying you can’t buy goods from a country. I don’t think it helps the country that says that. I mean, this is sort of what Donald Trump is doing with his tariffs. He’s saying I don’t like your country, so I’m going to put a massive tariff on it. And of course, who pays that tariff? It’s the American consumer.

Callum Sinclair

That’s not a profit sharing issue, though.

Janaline Oh

No, no, no. But I guess what I’m saying is that blanket trade bans are a very blunt instrument that don’t actually necessarily work to the advantage of the country that imposes them.

What the Government and successive governments, I mean both Labor and Coalition governments, have tried to do about this issue over many years, is work through, for example, the OECD, which is a group of, I think it’s 28 or 30 countries that traditionally were high income countries. It now includes a number of middle income countries.

They have been working through that forum on what they call base erosion and profit shifting. So what they’re trying to deal with is exactly that issue of companies that claim to be making no profit because they’re doing this dodgy accounting around their intellectual property and their logos and stuff like that, that is hard to pin down. And they’re making sure that all the profits are being made in countries that have very, very low tax. There was a proposal for a 15% minimum tax that would be distributed amongst all the countries in which a company has, you know, income generating activities.

The Government has also unilaterally looked at better ways of taxing multinational companies. That was actually the only tax reform that they took to the 2022 election. Because basically, you know multinational companies don’t vote in Australia, which I think was a bit of a political cop out myself. But like, I get it. I would hope that with the thumping majority that they have, they would be willing to be a little bit braver about more general tax reform options, but definitely multinational companies are absolutely 100% in their sights and they have already taken some measures to try to address those problems.

It’s not easy. It really isn’t. It does require a degree of international cooperation, which is also not easy, but there are some things that you can do locally. You can tax their local assets more. You can tax their local cash flow more in order to capture that profit generation issue.

Callum Sinclair

So like an increased GST for companies which are multinational?

Janaline Oh

Well, I mean an increase in GST would obviously capture Uber, because as well as rich people not being able to avoid consumption taxes, also multinational companies cannot avoid them.

Callum Sinclair

Another game I’ve heard of is owning an asset, never selling it, but then borrowing against that asset to avoid paying any tax, because you haven’t done a taxable event which is selling the property. You’ve just borrowed against it, and the bank then could possibly get that property.

Is this a problem in the Australian context? I guess an asset tax would capture that because it doesn’t care whether you’ve got a debt or not, it‘s just the asset requires a tax to be paid on its value.

Janaline Oh

Yeah, yeah, absolutely. An asset tax would capture that.

I don’t know the extent to which it’s a problem. I mean, I think in some ways you’re talking about using something as collateral, usually a piece of real estate. That’s not necessarily a bad thing, because if you’re then borrowing against that and that’s funding a productive activity that produces goods and services or creates innovation, or makes great music or something then that’s probably not a bad thing. I guess then it comes to how the taxation system ensures that you’re not gaming the borrowing, you’re not gaming the debt.

To be honest, I think in Australia the only way you can really do that is if the asset is a piece of real estate and you’ve negatively geared it and so you’re getting a tax concession on your interest payments against that, and you’re also potentially going to get a massive capital gains discount if you happen to sell it. So I think if we had tax reform for real estate, which is what we started with, and some sort of broad based asset tax, that would probably deal with that.

Callum Sinclair
So I’ll try and frame it in terms of the title of our at least a question on the title of our podcast here. So why can’t the Labor Party just change the tax system to reduce inequality and to give them money to provide services like social and affordable housing.

Janaline Oh
Well, I reckon they can.

Callum Sinclair
You think they can?

Janaline Oh

So I think the question should be why don’t they? And I think the answer to that is politics, because at the end of the day, people generally don’t like paying tax and generally speaking, if you threaten to raise people’s taxes, they get cranky and they won’t vote for you.

Now I think there are ways in which you can manage the politics in a positive way. There are ways of making adjustments to the tax system that potentially start with very well off people. So for example, the proposal to reduce the tax concession on superannuation balances of over $3,000,000, which is a very, very small number of people. They would still have concessional superannuation, they just wouldn’t have as much concession as they do at the moment. I think that is a tax change that should be possible to implement and, I hope they do it and I don’t quite understand why they haven’t yet.

Callum Sinclair
Sure.

Janaline Oh
I think actually what the Government needs to do in order to implement these things is to have a proper conversation with the Australian people and explain to them what taxes fund.

You know, one of the things the ACT government does on your rates notice is they have a whole page of what your rates are funding and it’s like, I don’t know, 50% goes to health and 30% goes to education. I can’t remember the numbers, but there’s this kind of wheel of where your money is going and how much is going to each thing.

And the reason they do that is because somebody did some research that showed that people are much more willing to pay their rates if they can see where they’re going, and they can see that they’re going to things that they actually like. I think the federal government needs to have more of that conversation with people.

And the other thing that I think they need to have a conversation about is what happens when you don’t collect enough tax. So either people get fewer services, or you run up massive debts, you run the risk of inflation, and then you have a crisis and you can’t deal with that crisis.

I’ve lived in countries where governments do not collect enough tax and what it means is that poor people get no services at all and the middle classes and the wealthy have to pay for their own services. So they all have private health care and they all send their kids to private schools and OK, you can say, well, I’m earning a decent income. Instead of paying tax, I’m paying for these things.

Where it gets really expensive though, is when you actually start paying for private security. My sister lived in South Africa for 3 1/2 years and their company had to pay for private security. They lived in a kind of locked gate compound. They got carjacked once in their driveway.

That is all very, very costly. You know, just the money cost is very high, let alone the stress of not knowing when you’re going to get carjacked.

In Papua New Guinea, there were private companies that were paying for their own roads. So when you start having to pay for your own road, that is astronomically costly.

So I think when people say oh, I’m paying too much tax, I think the Government needs to open a conversation with people about firstly, what their taxes are paying for, and secondly, if you’re not paying this amount of tax, then potentially you’re going to have to pay for these services yourself and procuring services like this privately is much, much, much more expensive than paying tax to a government that can do it for you.

And poorer people, people who don’t have good jobs and good incomes just get no services at all, and that is actually a terrible thing. And it fuels unhappiness in society. It fuels insecurity. It fuels crime. It creates all sorts of social problems that also affect rich people.

I think if the alternative is to pay more of your income in tax, but to have these good services, to have social stability and security, I think that is a trade off that a lot of people will be willing to cop.

Callum Sinclair

Sure.

Has the Australian government been taxing appropriately for the past 20-30 years? I think a lot of people argue that Australian state and federal governments have sold a lot of assets, have put themselves in a lot of debt and that is an indication that they haven’t been taxing appropriately.

Janaline Oh

I think the problem with those asset sales is that the governments that privatise those assets did not also increase competition in those sectors. So what they did was basically shifted from a not very efficient public monopoly into a not very efficient private monopoly. And then any rents that accrued, instead of going to the public, went to private companies.

And I think that is problematic. I think the lessons of NSW, which sold poles and wires and sold a lot of the electricity sector, and Queensland, which did not, has shown that it was actually quite smart to hang on to them. That they are natural monopolies and that it is very hard to introduce competition into those sectors and that, in fact, it would have been smarter, probably, if the NSW government hadn’t sold them.

Having said that, it was the sale of the poles and wires that actually funded the Sydney Metro. So the people of Sydney have arguably got an asset that they like a lot in exchange for, you know, a lot of issues in the electricity transmission sector, so it’s probably not a very straightforward argument.

I mean, I’m a member of the Labor Party. Generally speaking, I’m not ideologically opposed to government-owned assets where you’re talking about infrastructure and essential services and monopolies. But you know, I think it is a complex argument. And I would also say that even aside from asset sales, I don’t think we’ve been collecting enough tax in this country for quite a long time.

The narrative in a lot of the media has been, oh, Australia doesn’t have a revenue problem, it has an expenditure problem. The Government needs to spend less.

Now I think that governments can always find ways of ensuring that taxes are spent efficiently. Having said that, I don’t think blanket efficiency dividends are sensible or work because actually what it means is that, in the first couple of years, it probably does force departments to find efficiencies, and then after that they just start producing less and delivering less services. And I don’t think that’s a good thing.

So while I’m a fan of constant vigilance to make sure governments are spending efficiently, I also think we do have a revenue problem because people like the services that they get. People value Medicare. They value the National Disability Insurance Scheme. They value public education. They value public infrastructure, and if we are going to keep delivering those services, we have to fund them.

And I think in a country like Australia, we should be able to fund public services that are delivered more equitably. And coming back to the original questions about inequality, I think having excellent public services is actually one of the best ways of reducing at least the effects of inequality. Even if numerical inequality persists, because as long as people have those basic services and are able to live decent, comfortable lives, then you know, maybe it doesn’t matter that a few people are stupidly rich.

Callum Sinclair

Wrapping up, the music is called Insurrection, written by Pierre Chrétien, performed by the Soul Jazz Orchestra, courtesy of Do Right Music Inc.

My name is Callum Sinclair.

Janaline Oh

My name is Janaline Oh and this is Why Can’t They Just.