Monday, November 9, 2009

Challenging market hegemony

Kenneth Davidson is one of the few remaining economic journalists in the mainstream Australian media who challenges the pro- market stance that dominates most commentary on political, economic and social issues. Davidson is unashamedly opposed to the contemporary religion of neoliberalism and free market economics.

Davidson has an excellent piece in today's Age on the Future Fund.
"The real question should be whether the nation can use the $60 billion fund in more productive ways than for speculation on financial markets. The fund's money has come largely from the sale of government assets, including all the buildings owned by the Commonwealth (apart from the War Memorial and Parliament House), plus $40 billion from the sale of Telstra. Arguably Australians are worse off as a result of these asset sales"

.......The setting up of the fund outside the normal budget based on annual appropriations and not subject to cabinet and parliamentary approval, is wasteful, an affront to democratic process and potentially corrupt.

Davidson highlights that the fund has set up five subsidiaries in the Cayman Islands tax haven. The fund does not pay Australian tax but shares the benefits from tax avoidance by companies in which it invests that have set up head offices in the tax haven. As Davidson points out the Finance Minister is not concerned that the fund is aiding tax avoidance.

Davidson argues that the Future Fund should be closed and be used for investment in renewable energy and especially alternatives to coal so that Australia is to escape ''peak oil'' and global warming relatively unscathed.

Davidson also co edits one of Australia' s best small journals Dissent which publishes excellent pieces on social, political and economic issues. You can visit the website of Dissent (here), subscribe to Dissent or find it at most good newsagents

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