The Rotten Systems, and is there an Alterative?

The so called Civilizations since mankind came out of the cave, or maybe came down from the trees have hardly changed over thousands of years, because we are now as brutal to each other as they were in the stone ages; the only difference is, that thousands of years ago, men fought each other with sticks and stones, and now destructive weapons are used to the point that the planet on which we live could be completely destroyed in matters of minutes, if the potent weapons, designed by very clever people, put into the hands of not so clever, so called leaders, be they Kings, Dictators or just Politicians, and none of the latter display any scruples or courage to speak up against what should be spoken up against.

But in the so called Democracy, are the Politicians only to be blamed?

If a Politician speaks honestly, if that is possible, will he/she be re-elected at the next election; most likely not, and that is the weakness of a Democracy, the citizens in a Democracy cannot accept the truth, which may go against the voters interests.

How could Democracy be improved so that it becomes a better system of Government than all the other systems that preceded it?

Considering the previous systems, Be they Oligarchies, Royalties, Plutocracies  or Communism.

The first three are only for the benefit of the few, based on either birth or other means, while the last would be the best, yet it completely collapsed after less than a hundred years, but why did Communism collapse so quickly?

The Capitalist always harp on the idea of being the human nature, and greed will always come out on top, when it comes to benefit humanity.

For Communism to work, the human mind has to broaden enormously, because if people think that Communism is a system made in heaven, they are very wrong, because it is obvious that if nobody is prepared to put the effort he/she is capable of, and everybody has no desire to limit their consumption, the system cannot function.

But in any system, the main problem is, that there are always people trying to usurp the leading positions, and there is nothing wrong with that as long as they are capable of being the leaders and are not just in the leading positions for their own benefit or boost their big ego.

As most of the aspiring leaders have the ability to fool the common people, by first crawling to them, and when they are in positions of power they will quickly turn around and often misuse the power vested in them.

The people in power also have the great ability of surrounding themselves with underlings who will lick the boots of their leaders, and empower the leader to overcome any attempt to challenge their leadership

Many male leaders are often also controlled by their wives or female partners and are rather weak in reality, but very cunning to outwit their opponents, but in the long run, the society with weak or unfair leaders always suffers.

In a Marriage, where a partner with less ability gains control through having a thicker skin, in the end both partners will not achieve their full potential, and this will also apply in every other Organization up to the leadership in Governments.

That does not mean that the more skillful partner in a marriage should debase his/her partner, but for the benefit of both and the community at large, fools should not be leaders, but use their skills and talents for the benefit of a family, a group or Government, and the so called Indians are just as valuable to society as are the Chiefs.

Never, never should the leaders in society be left in total position of power, but should  always be challenged  to explain and justify their actions.

Unfortunately many individuals which are prepared to challenge the leaders or the system are conveniently accused of “Rocking the Boat” or called “Whistleblowers” and many times they pay a high price for their actions.

Also the leaders of any society should not be put on a pedestal and idolized like super heroes, and when the people in power talk about serving the Community, they should really show their true colours and admit that they are not in those positions for their own ego and like to have the nose in the trough.

How many families become career politicians; now if to be a politician is such a hard and demanding task, a parent would hardly encourage their offspring to follow in their

footsteps.

One way how Democratic performance could be greatly improved would be is , instead of having the Senate and Legislative Councils, abolish them and set up Committees of interested citizens to perform the task of keeping a watch over the Governments, and they should not be paid, except being remunerated for any expenses in performing their tasks.

There could also be some risk that this committees set up to keep the “bastards honest” do not become in to the same mould of the Australian Democrats, which although now completely obliterated, are a huge burden on the taxpayers, as there are many quite young ex MP’s enjoying the benefits of a generous parliamentary pension, with all the attached perks.

In the capitalist system, much emphasis is placed on the value of capital for the benefit of society, but is capital really so important for the function of society?

It is also emphasized that money has to work hard for the benefit of the owner of the money; but money does not work, only people work.

Soren, I consider that the tax-free super for the over sixties will in the long run be unsustainable.


The Great Super Fraud.

How many people are aware that there are people on super income of more than hundred thousand dollar and not paying a cent of tax?

Australia has a three tier social service system, which the Australian politicians claim to be one of the best in the developed world, consisting of a basic means-tested age pension, compulsory super of 9% paid by the employer, but the workers forfeited wage claims for it, and other private savings.
1)      The means test prevents anybody dependent on a Centrelink pension to raise his/her income from rising to a decent living standard of income. It is considered that a couple needs an annual income of $50,000.00 for a decent standard of living, yet when the total income for a couple reaches $6448.00 per annum, the means test cuts in and for every extra dollar of income, the couple loses $0.40 of Centrelink pension, and this will increase to $0.50 in September, to where it used to be before the Better Super was introduced.
2)      If most of the private income is in one name of the couple, once the combined income reaches some $40,000.00 per annum, one partner will pay tax of $0.315 including Medicare levy, leaving the couple with the majestic sum of $0.185 for every extra dollar income.
3)      As some 78% of the population who are of pension-age receive some Centrelink pension, they are all affected by the meanest “Means Test” in the developed world and this will continue for the next generation, because according to all Government statistics the majority of the population will not accumulate enough assets through the compulsory super to be independent of the Centrelink pension and will therefore be affected by the Means Test.
4)      Who are the real beneficiaries of the compulsory super? The 20% of the population with sufficient income, not to be dependent on any Centrelink Pension, because they benefit much more from tax concessions than they would gain from any Centrelink Pension. The tax concessions for super almost equal the total cost of the age pension. Approximately $25 billion.
Who owns the majority of Super assets?
Billions of dollars of fees are flowing to financial advisers as they bask in Australia's growing preoccupation with retirement income from superannuation and other managed funds.
No wonder Pauline Vamos agrees with the ACTU’s call for 15% contribution to super, as reported in Australian Financial Review on the 9’th of June 2009 under the heading “Industry warns of threat to super incomes”.
Do the Super funds work for the benefit of the super contributors?
They have a conflict of interest as they are companies responsible to their shareholders.

As the majority of the ACTU’s members will never accumulate enough assets to be independent of the Centrelink pension, it makes one wonder whose interests are they representing; mostly the leaders, many of who finish up as Members of Parliament on a fat Parliamentary Super.
Data on super assets as reported in Financial Review on page 17 on 9’th May 2006 as applicable to 2002.

Mean value of superannuation

Poorest 10% own 0.4 =289 million proportion of total value % =0.000001

2nd  10%              2= 2181 million                                                % =0.4


Richest 10%  358.7=343,990million                                              %=57.8

Now Prince Costello has delivered his budget and you can guess which section of the community received the most benefits.

When the Howard government introduced the tax-free super for super paid from a taxed fund,that virtually gave millionaires tax-free income of at times more than $100,000.00 a year. How can that be justified?

As Australia has a safety net in the form of the age pension for every person of pension age and residential qualification, why should the Government provide the top 10% of the richest people with such extraordinary tax concessions?

If the means test for the age pension was abolished, every person could try and save for a better income in retirement and not having Centrelink look over their financial interests, treating the Centrelink pension recipients like second class citizens.

Question for the Government.

Question,1): Could you please inform me which government of any developed country means-tests the basic pension?

Question,2): Which government exempts millionaires from paying tax if their income is derived from a taxed super fund and they are over 60 years of age?

Freediver, the effctive tax rate is exactly what I mean, if the government would pay evrybody above 65 the full age pension, abolish all the tax concessions for super, it would be cheper for the government and fairer on everyone.
Australia provides every person, who qualify residentally and are over the age of sixty the safety net of an age pension, if their assetts or income drop below a certain level, so why should the government provide the people of large assetts all the tax concessions, while they penalise every pensioner with punitive loss of Centrelink pension if their assetts exceed $6640.00 per annum.
Australia is the only OECD country which uses the means test too keep the majority of the age pensioners poor.
The australian age pensioners are the second poorest among the OECD countries, only second to Ireland.

Freediver, could you please tell me, what does the word "Fair" in the National Anthem stands for.
Or don't you believe in fairness.

hawil wrote on May 27^th, 2010 at 4:58pm:


I don't believe fairness comes into taxes. If you want a fair system, try communism. I certainly don't think our national anthem is about government handouts.

I asked some very specific questions in my last post. Try answering them.

[highlight]Home > The Hon Chris Bowen MP
INTERVIEW WITH DERRYN HINCH
3AW
WEDNESDAY, 14 OCTOBER 2009
SUBJECTS: Superannuation system, Superannuation Guarantee, Henry Review, Cooper Review, Age Pension
DERRYN HINCH:
On the line the Federal Minister for Human Services, Financial Services, Superannuation and Corporate Law, Mr Chris Bowen. Good afternoon.
CHRIS BOWEN:
Good afternoon Derryn, nice to talk to you.
HINCH:
I think you are caught in a bit of a cleft stick here and I'll tell you why. On the one hand you want people to save more, to become self-funded retirees, so they need a pension and they won't be a burden on the tax system, but on the other hand, by making that more attractive, look at all of those billions of dollars in lost revenue from superannuation concessions. Would that be right?
BOWEN:
There's nothing you say there that isn't correct Derryn. There are substantial tax concessions for superannuation; about $25 billion a year the Government gives up in terms of tax concessions for super, built as you say, the pay-off for the nation is that people have a much more comfortable retirement income and not on the age pension so that frees up taxpayer funds for other things.
What I said Derryn is that we are all getting older, the Australian population is ageing, we are living longer, and we need to have a discussion about how we are going to put money aside for the future - both as individuals and as a nation. There are a whole lot of mechanisms that we can employ to increase people's retirement income through super and I think they all should be on the table.
HINCH:
Okay, now this idea of a super guarantee increase - this idea of Paul Keating's but he didn't get there - has been stalled for many years on nine. Is it true that you want to get it to twelve?
BOWEN:
No, what I said is that we need to be boosting retirement incomes and that is one of the options. The other option, as you indicated is tax. One of the things I pointed out is that low and middle income earners often left out of this debate. They actually get very few tax concessions for super when you look at how they are treated, because we tax super at 15 per cent, but for 1.2 million Australians that is there tax rate, so it is not concessional. If you are up on the highest tax rate 15 per cent is a very low tax rate in comparison, but if you are already pay 15 per cent anyway then that's not a tax concession at all. So I've said that we shouldn't forget them in this debate either.
HINCH:
But don't you want those on higher wages to push more and more into super so they are guaranteed that they will never ever draw on a pension? They pay higher taxes because of their incomes, and by letting them have those concession of 15 per cent and pushing $100,000 - or it's been reduced to $50,000 now - each year into super, you are guaranteeing that they will never get a dollar from the government.
BOWEN:
Well that is certainly the case in relation middle income earners, you are quite right. When you look at higher income earners they would be very unlikely to go onto the pension, because they would be saving through one mechanism or another. Saving is good for the nation because it means there is that pool of funds available and that has been very useful over the last two years, with for example, more than $1 trillion of money that we have in superannuation and that has been very useful for companies in terms of investment over the last few years. That's true. But the main focus of superannuation must be to ensure that lower and middle income earners have as comfortable retirement income as possible and if it can be avoided, don't go onto the age pension. It's not in there interests or the interests of the economy, more generally, to have more people than necessary on the pension. The pension is there, it is very important, it is a very important policy mechanism to support people, but people are better off if they don't need to go onto the pension in the first place.
HINCH:
Now Ken Henry, he says that the 9 per cent compulsory contribution would afford a comfortable retirement income. Do you think that is not enough?
BOWEN:
Look, what I say to that is, people have different views about whether 9 per cent is adequate. Let's have a discussion about whether we can do a bit better than adequate, for people's retirement. I want people to be as comfortable as possible in retirement. That might mean a bit more than the bare minimum; a bit more than the just adequate. But look these debates will go on and off and it is appropriate that we have a national discussion about what's the best way to boost people's retirement income.
HINCH:
Alright, the final question. One of the things that effects people - apart from the fact that we all got clobbered by the global financial crisis and ignored the fact that we all had great returns for four or five years before that - I think one of the things that gets in peoples crawl is that the management funds fees are sometimes absolutely reprehensible.
BOWEN:
Yes, two points there Derryn very quickly. The first point is, that's right, over the long run returns on super have been much higher than inflation so we are much better off, even though we have had recently these very concerning, negative returns, but your other point is dead right, even a small reduction in fees over the 40 years in the workforce can have a really big impact on their retirement income.

Soren and Freediver you have kept rather quiet on my recent posts.

Hi,

I am just new

Instead of me spending the next two days reading the backlog, someone want to give me a summary of where this concept is at ?

FYI: Dick Smith is totally into sustainability.