Australian Tax Office engaging in psychological welfare

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We are approaching the end of the financial year again; and once again, the tax office is working in concert with the media to extort wealth from you. The psychological manipulation is 'in play' once again. Governments are increasingly using fear or 'shock and awe' techniques to extort wealth from you. Consider these media headlines:

1. "Eight ways to beat the taxman" in the Sydney Morning Herald, as if you are under some obligation or compulsion to have a relationship with them, or comply with their demands.

2. The pursuit of high profile 'tax evaders' by the tax office to impress upon you the unlimited resources (i.e. your money) that the government can use to pursue you. Refer to my posts on Wesley Snipes and Paul Hogan.

3. Often there are argues of the nature 'The tax office is targeting deductions, or 'fringe benefits', etc. Every year there is a different psychological threat made upon you.

The tax offices pursuits of course rely on your acceptance or ambivalence about whether you actually are obliged to pay tax. This of course relies upon your ability to argue in a court of law that you ought not to, and that you have a right to legal aid. Most of course don't have the skills to argue these points....so they live in fear of the tax office. The reality is that there are ways of protecting yourself from government that few people appreciate.

In conclusion, the tax office likes to smear or discredit people as 'tax evaders', but as far as I'm concerned, these people are righteously acting in their self-interest, and that is an entirely reasonable thing to do given that:

1. The state does not deserve an effectively 'unconditional' or arbitrary sanction to tax

2. The state is not acting as it was intended, i.e. as an agency for the extortion of wealth for the sake of its own self-serving ends. i.e. Acting on the basis of perceptions rather than facts, or demonstrating that it acts without regard for rights, or gives no regard to your interests are all evidence of its failure to comply with its constitutional requirement of 'good governance'. So our government is in breach of the 'spirit of the law'.

3. The ability of the tax office to use its 'unlimited' taxpayer funds to persecute you...keeping you in court for a lifetime under the threat of pernicious 'arbitrary' statutory law.

4. The government is entirely inefficient and unfair in its collection and expenditure of public funds. It is not a moral custodian, and it can be reasonably argued that it is not acting within the spirit of the constitution. Anyone with a solid grasp of the philosophy of law will realise this.

So I say to you....if you pay your fair share of tax; take every measure you can to reduce your burden. I personally would celebrate any effort which repudiate the govts right to impose arbitrary imposts upon you, fair or unfair. There is no question of fairness when it comes to extortion. You are not morally obliged to suffer because others are subject to extortion. You are not a slave to other taxpayers; just as you ought not be a slave to the tax office.

Japan Foreclosed Guide Mining Fundamentals eBook Resource Rent Tax Australia

Author Andrew Sheldon| Applied Critical Thinking | www.SheldonThinks.com

Andrew Forrest...the investor's friend

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An article in the Sydney Morning Herald provides a clue to how democracy works. If you are poor and don't matter, you attempt to contact your representative and hope they can help you. Unless they are helping themselves to your wealth, they can be accommodating. The system is flawed because its arbitrary. Its arbitrary because the government has to justify expropriating wealth. Common law does not allow stealing, but statutory law does. That's right....logic will support the adoption of taxation. You need political extortion or coercion to achieve that. The parliament and 'representative democracy' were merely concepts conjured to legitimatise expropriation or stealing. There is no justification for it. If you find any pretence of one, let me know, and I will repudiate it. Really folks! There is no argument. Attempt to offer one, and I will repudiate it.

People don't normally take such issues to the High Court. Maybe Andrew Forrest of Fortescue Metals will be the first. I hope he can seize upon the right arguments. This is where I fear his legal counsel will be the problem. They will not have any idea as well how to fight this battle. One of his biggest problems is a conflict of interest within the judiciary. The problem is they are appointed/selected by government, and they are paid by government, on the same basis as a bureaucrat. They are safe people by nature; generally not open to challenging a tradition of expropriation. The problem is it comes down to the spectre of a flawed philosophy of law which is based on arbitrary interpretation rather than any coherency test of conceptual validity. I would love to see Forrest test the system. I am glad there are still a few billlionaires left in the world who can afford to enter the justice system without much to lose.

That's right...we have been a culture of perpetrators and victims since well before the Magna Carta (12th century). The creation of parliaments was just a process for 'modernising expropriation'.

We must understand that Andrew Forrest is the embodiment of a asset owner. The guys at BHP and Rio Tinto are 'asset managers', i.e. CEOs with no equity in the business. They have no significant interest in the outcome. So what does it matter what they think about this tax? Nothing. Andrew Forrest is your friend because he, like you, is an asset owner. The great news is that he has more to lose than you, so he stands ready to take this 'Resource Rent Tax' issue to the High Court if necessary. But its not enough to test matters in the High Court because our legal system is flawed. It would be helpful if Australians differentiated 'asset owners' from 'asset managers'. Andrew Forrest is a fellow investor like you or I. The CEOs of Rio Tinto and BHP are really politicians or 'middlemen' only interested in taking their cut. If they can convince the board that they have no control over this issue, then they have their options incentive adjusted, and they might even come out ahead. Meanwhile, it is shareholders who suffer.

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Author

Andrew Sheldon

Resource Rent Tax Australia

Applied Critical Thinking | www.SheldonThinks.com

Is the media biased on the Resource Rent Tax issue?

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Perhaps Kevin Rudd has complained to the media companies that he is not getting enough fair play for his new tax. Maybe a bad tax was never supposed to have been heralded as the start of a new age. Phillip Wen from the Sydney Morning Herald has come out in defense of Kevin Rudd. so let us examine his arguments. Is the media biased in favour of miners? Rudd? Well, I would suggest to you that its hard to be on Rudd's side when you introduce such a sudden, arbitrary, discriminatory tax as the Resource Rent Tax. It is also poorly conceived. But let's challenge the arguments made in this article.

1. Xstrata has exaggerated the impact the tax will have on its operations, with talk of job losses and cancelled projects.

The reality is that a mining company makes money by assessing the feasibility of the project. When a government moves the goal posts in the middle of a game (i.e. After a miner has spent the money, or after a shareholder has bought stock upon certain assumptions), ought they expect the government to protect their rights rather than breach them? Is there a positive side to fascism? Only a deluded moral relativist would argue yes.

2. Xstrata was unbalanced in its disclosure of employee numbers when it closed the Windimurra mine in WA. i.e. It did not disclose the numbers for Windimurra, but not it is disclosing the numbers for its new mine.

I would argue that the mining company is obliged to act in the interests of its shareholders, and to do so in accordance with the law. It was a sad fate for the Windimurra workers. It was a strategic move by Xstrata to buy the Windimurra mine and then close it to support its other mine in Africa (I think?). This is business. If anyone is opposed to that, then an argument needs to be made to change the law. Hopefully it will be a logical argument, unlike the argument made by Rudd....which is based on gross opportunism and extortion. Clearly it is in the interests of Xstrata to re-examine the economics of a project when a government changes the rules. Even if they are bluffing, they are reasonable to use all arguments to discredit the government. It is my opinion that the mining industry is using concrete, pragmatic argument rather than ethical ones because they think that will have greater traction with the voters. I disagree, and I think the strategy can backfire because its money in their pocket. They ought to remember that after Rudd gives them a "super-kiss" he is probably going to give them a "Ruddy tax kick in the balls". That's right...Rudd has ruled out another arbitrary tax on other specific industries....but what's to stop another government, or him taxing all super funds...after everyone has placed all their savings in super...this is what happens with arbitrary rules....you don't know where you stand.

I would however argue that Xstrata did not treat Windimurra shareholders badly as "minority interests", but its a cloudy area of law. I challenged this issue at the time. Having acquired Windimurra, the company placed the project on hold. In fairness, it would have pursued the project if there was a great deal of money in it. Strategists could have seen this unfold. It was a good decision for Xstrata shareholders.

3. The Minerals Council of Australia is spending a reported $100 million on an advertising blitz against the tax.

What else can a minority interest group do other than to engage in a media campaign. Rudd is offering a 'welfare-like' carrot to voters in the form of a "super-kiss". It will take a well-funded campaign to overcome the appeal of this unethical tax upon miners and shareholders. Sadly, the nature of our political system provides a poor basis for reconciling political arguments.

4. The notion that the mining industry has used these tactics before to undermine the government's proposed emissions trading scheme, saying it would severely damage the coal mining industry, leading to big projects shutting down.

Quite rightly. The tax would have destroyed the industry. It would have placed the fate in the hands of unproven technology and subjected them to very high capital cost burdens to make the technology green. The biggest problem the mining industry has is the unproven nature of the 'anthropogenic global warming'. The most recent evidence supports the idea that variations in sunspot activity is the cause. There is good correlation between these solar flares and climate change. Satellites launched in 2006 will offer greater certainty in the next few years. The problem is that the 'liberal' media needs to defend its dire media statements about global warming. Their treatment of this issue highlights their lack of objectivity and their lack of scientific and critical thinking skills.

5. Research conducted by the Australian Conservation Foundation and the Australian Climate Justice Program last year found six companies - including Xstrata, Rio Tinto and Woodside Petroleum - made public statements on emissions trading that were not reflected in formal announcements to the stock exchange.

"The regulator did not pursue the findings, saying the companies made their statements at senate hearings, and were therefore political statements made with parliamentary privilege and not made in the course of trade and commerce".

Not only that, but from my experience submitting documents to the parliament, you are not supposed to publicly disclose the info. Why was this argument made? To make it look like the reporter had a story?

6. Xstrata's biggest shareholder is the Swiss commodities supplier Glencore, one of the world's largest privately held companies, infamous for its colourful past. Its founder Marc Rich, was cited in a 2004 CIA report for paying illegal kickbacks to obtain oil from Saddam Hussein's Iraq regime, in breach of United Nations sanctions.

In the interests of fair disclosure...just look at the track record of US foreign policy over the last century and ask yourself whether that is a fair critique. The reality is that companies have a far better track record than governments, which is weird because governments make the rules. Which can be difficult to interpret because, as we know, they are so arbitrary.

It ought also be mentioned that BHP and the Australian Wool Commission were caught up in the same type of scandal....but why would you smear all mining companies for a breach of US foreign policy. Is that the best this 'liberal' journalist can do?

7. The Construction Forestry Mining Energy Union is for the tax so suggests Xstrata is exaggerating claims.

Yep. I'd go to the mining industry for a balanced perspective on mining company ethics. The union movement were of course the extortion experts of the last century, so they love miners. Anyone remember the wharfies dispute in Wollongong.

8. Final point....the journalist concedes "But the concerns in the mining industry are real. It is not in debate that successful miners will take a hit to their profits".

Ask yourself what that does to investors. And the lost profits will be higher as prices rise. All those future 'opportunity losses' will be wiped off the value of mining projects and mining companies today. Is that share to shareholders in mining companies? Shareholders do not invest to lose.

9. Xstrata would favour overseas projects if the tax was implemented. ''Someone like Xstrata.

There is no question that this will happen. There will of course be some appeal to Australia because the infrastructure is already there and its close to Asia. Though there is iron ore in Asia, e.g. Indonesia, PNG, Bangladesh. Some of these countries were believed to offer greater sovereign risk than Australia, however Kevin Rudd has changed that with his arbitrary tax. In fact, it will be interesting to see if Rudd leads a resurgence of fascism around the world. Other governments could follow suit as he has given arbitrary 'fascist' taxation his 'Western government' approval. I don't even think that Obama could get away with that.

10. "Tony Maher says that as with the lobbying against the emissions trading scheme, miners have to be kept accountable for the claims they make. ''It was corporate bullying then; it's corporate bullying now.'' "

Tony is a union man...so its interesting that a journalist would quote him on a point of ethics about bullying or extortion. Geez, hopeless unbalanced media.

Congratulations Philip Wen, you have just won yourself a citation from the Australian Broadcasting Commission....my complaint is currently being processed. Rest assured, based on previous experience, they come from your side of the political fence. Interesting arguments...pity your smear of Xstrata has nothing to do with 'ethical issues' involved. You seem to share the pragmatic concerns of miners....I wish someone would get to the ethics involved...maybe some of the regulators people studied some ethics. My guess is no.

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Author

Andrew Sheldon

Resource Rent Tax Australia

Applied Critical Thinking | www.SheldonThinks.com

Rudd selective with the facts

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Kevin Rudd is keen for good press releases. His latest opportunity came with the signing of a number of iron ore mining agreements. Rudd used the opportunity to highlight the fact that the mining tax had not impacted the mining industry.

"Australia and China signed more than $8,8-billion of commercial and mining deals on Monday as a senior Chinese leader urged closer trade ties, in a sign that Australia's mining tax has not deterred investment". [Mining Weekly]

The problem with this interpretation is that China needs iron ore, and in the short term it has to come from Australia, and there is no question that a great deal of it will come from Australia regardless of any imposts Rudd imposes. The problem is that Rudd is encouraging iron ore investments in Indonesia, PNG, maybe even New Zealand (despite its remoteness from China) instead of Australia.

Another problem is that the $8.8 billion in investment, is all oil/gas and iron ore projects, where Australia has a strategic advantage because of tight supplies or location advantage. Basically, this is the problem with this tax. It says that if you identify an opportunity, and the government has the capacity to extort some concession from you, it will do that. It will 'arbitrarily' tax you UNLIKE the rest of Australian industry. Meanwhile Google is paying just 0.1% income tax in Australia because the Australian government has no power to extort Google, because unlike mining, Google has the flexibility to move its operations offshore.

I would also suggest to you that small business in Australia are being denied Google Checkout services in Australia because the Australian government wants to tax Australians through Google Checkout more than it wants to encourage Australian small business. More 'authoritarian' extortion. Fair tax you think? It was always about the money

No tax is fair by definition. Any charge which is involuntarily or does not relate to the value of services rendered is 'arbitrary' taxation, and that is slavery.

Retain some sympathy for miners and investors who have seen wealth destroyed in sectors outside iron ore as well, i.e. coal seam methane, gold, copper, lead, zinc, etc. These commodities entail little in the way of strategic advantage. Investors in mining services are in limbo because they do not know the implications of the tax.

Slowly we slip into 'arbitrary' fascism and unthinking, unprincipled people say nothing. Where will it end. It always ends with killing. First it will be political activists disappearing. Don't expect any international interest, as the same game is occurring in all countries around the world. This is becoming normal. It will end in civil war. The government will make a broader imposition in terms of its implications, and you will think 'enough is enough'. By then you will think where did it start. At what point did I allow my principles to slip away.

Frankly, I would prefer to have some empathy for the rights and interests of people, because I don't want to benefit from parasitism like Kevin Rudd. I will probably benefit from Rudd's actions since I have shares in a PNG iron ore company (MGK.ASX), however its not the point. One has to make a distinction between one's financial interests and one's principles, which ought to relate to human nature, not arbitrary ideas bounced around in Rudd's head, or even parliament, which is about as rational as Rudd. Morality is not a numbers game. The concept of a Senate was never a workable solution if there was no measure to ensure reason was the standard of value.

There is a moral issue here. Kevin STRUDD is a parasite with the most deprave values. Don't wait until the next election to tell him so. Australia cannot wait. Every day this tax is under consideration is another day of lost wealth for Australians, as the stock market slowly grasps the impact of the tax.

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Author

Andrew Sheldon

Resource Rent Tax Australia

Applied Critical Thinking | www.SheldonThinks.com

Hogan's moral rights swept aside

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The successful prosecution of the Australian film icon Paul Hogan and partner 'Strop' Cornell highlights the dismal state of justice in the world. From the facts presented in the media it appears that Hogan was prosecuted on the basis of tax evasion. Hogan maintains that he did not know the basis of his tax affairs because he did not personally deal with them. i.e. He had a plethora of accountants, etc.

As far as I am concerned I do not expect honest responses from 'tax evaders' on such matters. When the arbitrary force of government intends to impose unreasonable burdens upon you, I think you have no other way to respond than with lies. Fear is the proper response when reason is not the standard of value. If the mob come to your door to kill your daughter, you do not respond 'Third door on the right'. You tell then anything to get rid of them.

So what is the standard of value? Well it is of course its a pretense....based on the premise of the 'common good'. The common good has however been defined by the parliament, and we all know what credible advocates of morality they are. Politicians do not lie to protect values they have 'earned' (unlike Hogan), but in order to evade responsibility and accountability. I am quite certain no politician has earned the right to extort wealth from Australians. The political system is a game we always lose because it comprises two 'non-combatants'. i.e. Liberal-NP and Labor. Not long after federation the two parliament coalesced into two parties. Contrary to the policy rhetoric, where they espouse a belief in competition, these two parties are intent on destroying all prospects for competition where it suits them. i.e. Even poor prospects like Pauline Hanson. You might ask why politicians, who are supposed to be 'moral agents', can justify such actions. The reason is simply they are not what they are supposed to be. Why would you accept the system? Even if you concede we need government? Why would you not stand in defense of those wronged by 'the system'? Why would you legitimatise that system. I don't. I don't vote, and I will continue to challenge the legitimacy of this system. The government publishes the number of registered votes who do not vote despite it 'being compulsory to voluntarily select between two non-combatants'. That's right, you are forced to make a choice. i.e. You are forced to give legitimacy to a system which is illegitimate. Why? To preserve the status quo, to preserve the entrenched interests of the two political parties. It does not publish the number of people who are not registered. Don't legitimatise the system. A better vote is non-participation. Better still would be to actually empathise with true victims of injustice (in accordance to some objective standard), as opposed to pretenses.

I think the problem with Paul Hogan's case is that he argued that he did not know what was happening, when in fact he should have repudiated the moral foundation of the political system. In fairness to him, the judiciary is as much a creature of pretense as any other government institution. It was perhaps a big ask for an actor & producer to identify the true nature of our political system, and he has so much more to lose financially, but you would think legal counsel ought to be able to provide such advice. Perhaps moral conviction would be stronger if more in the public displayed some. It starts with a question for the tax office:

"By what moral right do you purport to expropriate the earned wealth of others".

I have yet to hear any rational defense to this question. The 'betterment of society', the 'common good' or the 'good of society' are of course the standard answers. For logicians however, this response is not very compelling. What constitutes the common good?

When we adopt the 'common good' as a standard of value, we become a nation of perpetrators and victims. We hate those who have money, and we lust after with a sense of entitlement for that which we did not earn. In the process we ignore the reasons why some fail and some succeed, and console ourselves that a bad system has preserved 'stability' at the sake of a few, but in the process we have denied ourselves something much greater - the opportunity to achieve greatness. We have also disparaged those who have succeeded in deference to our own self-indulgence. Ask yourself if individualism or fascism is advanced by such a system.

The tax office of course comprises a group of parasites who will never amount to anything - not even their parents estimates. They are the unthinking 'plodders' who depend upon the wealth and productivity of others. They are not just middlemen - but middlemen who create nothing, add nothing. We cannot even attribute an efficiency to them because the loopholes in their systems have made the tax system more complex than it need be...except it needs to be. An arbitrary tax demands an arbitrary justification, which compels people to find loopholes, which demands counter-loopholes. So you need 5 specialised accountants rather than your own common sense. This is the 'efficiency' that the tax office has extorted upon the population. It happens because they have this 'arbitrary power'.

That is not the extent of the implausibility of the 'common good' concept. In these pages I develop additional arguments for why the current political system is a variant of fascism.

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Author

Andrew Sheldon

Resource Rent Tax Australia

Applied Critical Thinking | www.SheldonThinks.com

Rudd to make concessions

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There is a suggestion that Kevin Rudd is about to make concessions to miners over the Resource Rent Tax. The reality is that Rudd's leadership is in jeopardy, regardless of whether he gives in on the Resource Rent Tax (RRT) or not. There is probably enormous appeal in appointing Julliard Gillard, the Deputy PM. I forget her exact name...but she has the punitive look of a school teacher.

She will be appealing for women. I suspect the Labor Party will want to spring her on the Australian electorate at just the right time. i.e. Not so soon that she can cause embarrassment, but not too late that people will be suspicious of her capacities. The question is - has she been tested?

Ultimately representative democracy is a farce, and you will get another bad representative of your political interests.

Anyway, what concessions might we expect from Rudd? I want to make the following points:

1. Rudd should not use taxpayers money to compensate miners for any scheme it adopts. There is no justification for denying rights for one group, and then compensating them with money extorted from taxpayers in general.

2. Rudd should acknowledge the wealth realised or created by miners, whether through acquisition, exploration or retention of mining rights. No mining company ought to be worse off because of any changes it makes.

At this point I want to challenge the idea that governments should be able to assign, own or grant mineral rights to miners on behalf of the people. I see no problem with this conception if the role of the state is to facilitate development of infrastructure, or other facilities which preserve and fund the administration of mineral resources. The idea that government should use mineral resource taxes or 'rent' for welfare is abhorrent. The problem with it is that it actually is a form of extortion. The practice does not become ok even if government gives notice because:

1. Governments ought not to be supporting people with welfare, as they are actually modelling unhealthy life strategies of dependency, reliance on others and parasitism.

2. Governments will quickly use the rationalism that miners have a choice to corner the market, in the same way that MPs created the illusion that we have a choice by amalgamating into two parties. Don't you think we would have more choice if parties did not exist.

There is nothing wrong with the notion of public ownership of resources...so long as any money raised is distributed on a 'user pays' principle. I acknowledge that a lot of the wealth realised by people like Hancock Prospecting was probably only realised by them because of nepotism, incompetence of others, and that they hardly had to do any exploration to realise such huge wealth. But that wealth generation was realised under a system they did not design. Having realised it, the government should not be able to reclaim it....under the rationalisation that they are going to help Australians. Rationalisation. Its the same extortion that Hitler would have used. i.e. extort from a group for the benefit of the collective.

I suggest that any public funds might legitimately be used for funding defense, but the approach to the issue ought to be well-conceived. There ought to be no impact on existing wealth owners. i.e. Perhaps any tax would be recouped only after the share price of a company recovers to its previous levels at which the tax was applied. The problem with that I guess is that you place a limit over the share price, so it actually never gets there, until some shareholders take a long term view. That takes time. Not an easy issue to resolve. Why not just drop the whole idea. I'd be more inclined to reform the whole concept behind the existing tax.

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Author

Andrew Sheldon

Resource Rent Tax Australia

Applied Critical Thinking | www.SheldonThinks.com

Open Letter to the Governor General

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Attn: Her Excellency Ms Quentin Bryce AC

Governor-General of the Commonwealth of Australia

Government House

Dunrossil Drive

YARRALUMLA ACT 2600
Email: governor-general@gg.gov.au

Dear Her Excellency,

I would like to register an official complaint against the way the Australian government is conducting itself with respect to the Resource Rent Tax. It is clear to me that the Resource Rent tax is an act of extortion by the Australian government against the mining industry. Great wealth has been lost because the government has conjured up and released plans of this new "excessive" 40% tax. More concerning still is that it has discarded the bulk of the findings by the Henry Committee, and that it is intending to use this tax to finance an 'entitlement' to a broader group of Australians prior to an election. It is clearly the government's intent to use the tax as a populist policy in order to win the election.

I suspect that the Labor government has in fact no intent to adopt the tax, knowing that it will be blocked by the Liberals. It will however use the tax to win the election. Rudd knows that he is not going to win the next election unless he appeals to the 'short range' interests of Australians. This strategy has already cost many Australians a great deal of financial loss, it has jeopardised the sovereign risk rating of Australia, and it will probably result in a decline in our sovereign credit rating, even though nothing has in fact been done. This will undermine investment in Australia and probably result in an increase in interest repayments.

This policy initiative came from nowhere. The parliament is acting with contempt for the good governance of Australia. In India such practice has resulted in judicial activism, with a positive impact on the standards of conduct by the Indian judiciary. I sincerely hope you will act before we descend further towards fascism, which I consider to be the arbitrary and coercive use of force or expropriation. Little surprise that there is already talk of succession in WA. I regard this as a serious breach of parliamentary conduct. I have discussed the matter with other people, and they also consider this matter to exceed the excesses of the Whitlam government.

This is not the first issue. There has been a general decline in parliamentary conduct, including the First Home Owners Grant under the Liberal Party. This is comparable to price controls in its implications. The Rudd government came to power and 'doubled up' the First Home Buyers entitlement under that scheme despite the already high household debt levels and inflationary outlook. That would have sparked calls of fascism years ago. These acts involved arbitrary policy to prop up certain sections of the Australian community at the expense of others. Was not the Senate intended to protect minorities from such behaviour? Is not the High Court intended to protect the people from such breaches, or the Governor-General?

I think your intervention is warranted because a delayed High Court action will cast dispersions upon financial markets for the interim period. It will be another year before the High Court will be called upon to deal with this issue. The High Court ought to hold reason as the standard of value, i.e. It interprets evidence according to logical standards, and one would hope those principles are grounded in the facts of reality, as opposed to the arbitrary rule that seems to be underpinning the government's actions, as it underpinned the democratically-elected Nazis. I am not suggesting we are about to see fatalities in the streets, but there is a serious decline in ethical standards, and this is a precursor to 'emergency' actions which escalate moral interests and desperation. It strikes me that we are currently in a period such as the late 1930s, in the wake of the depression....as our own financial crisis unfolds.

The paradox is that I have already lost a great deal of money because mining companies are not properly regulated. Regulation (i.e. justice as opposed to the unnecessary, arbitrary government intervention like price controls, welfare, home grants) is at a low point. I complained as a mining analyst against the conduct of corporate executives and I was told that they don't have the resources. The basic functions of government are not being adequately carried out. I don't even bother to vote because the process is flawed. i.e. Forced to vote among a duopoly of alligned political interests. Who does that serve?

I would like to establish how I might make a formal complaint against the government with respect to these issue. It is clear in my mind what is required with respect to parliamentary reform. I am an intellectual, so I utilise my mind. It serves me best to live outside my cherished homeland because of fear of political reprisals. Paranoia? Surely this email will place me in even greater harm. Some things are just too important.

Regards,

Andrew Sheldon

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Author

Andrew Sheldon

Resource Rent Tax

Applied Critical Thinking | www.SheldonThinks.com

Non-conceptual mining industry a problem

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The problem in the mining industry becomes ever-more apparent with the following quote by Gina Rinehart, of Hancock Prospecting. Forrest is right to imply that they are communists (or fascists), but listen to her struggle with concepts...

"It's very difficult talking to Treasury officials who don’t really have non-theoretical concepts [of how the mining industry works]."

Concepts are theoretical. I don't think its a case of the Treasury not understanding mining. I think government has been moving in this direction for years...the mining industry is so concrete-bound that it is only waking up to the problem because the Resource Rent Tax is being considered. This is not the first imposition...it was not long ago that the government was looking to impose a 'green tax' based on the greenhouse scandal. That issue will probably slowly disappear with the recession....as science shows the global warming was always a natural phenomenon.

We need to get the mining industry thinking more conceptually...and long range. It starts with business, as they are really the defenders of freedom in the Western world.

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Author

Andrew Sheldon

Resource Rent Tax

Applied Critical Thinking | www.SheldonThinks.com

Peak mining body ready compromising

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Another reason why Australia and other countries move towards fascism is because of their short-range thinking and lack of principle. They simply don't see the long term implication of their ideas. Its truly remarkable.

When a man comes to your door and demands $100,000. You do not give it to him readily, unless your life is at risk. If he suggests another proposition... "ok I'll let you give me just $50,000"....do you consider that a good compromise.

The answer is 'NO'. That is not a good compromise for several reasons:

1. You would have conceded an important principle...the right of government to make any arbitrary imposition upon you...for any dubious reason.

2. The government originally intended to make an outrageous claim with the expectation that you would compromise.

3. You will have established a precedent for the government to attack other industries by the same policy initiative. i.e. The old strategy of 'divide and rule'.

4. You will have given the government the legs up, as far as coming back in future for a larger slice of the cake.

Mr Hooke said the minerals industry was not against paying more taxes as it became more profitable, but the design of the government's proposed new tax was flawed.

Contrary to commonsense, the Minerals Council of Australia is ready to give the government what it always wanted...an increase in tax on mining. The Resource Rent Tax will do two things:

1. It will make government effective 'free carried' owners of capital

2. It will expose the government to financial risk, i.e. the govt will have benefits and obligations

3. It will have extended the hand of government into industry

This is the most courageous act of fascism since President Chirez of Venezuela nationalised the oil industry and Mugabe of Zimbabwe nationalised the farms of white landowners.

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Author
Andrew Sheldon
Resource Rent Tax
Applied Critical Thinking | www.SheldonThinks.com

Miners cancelling projects by the dozen

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The Rudd government's plan to expropriate wealth from mining sector investors is the most opportunistic grab for cash we have probably seen in the last 100 years. Oh, there was an attempt by a Labor state government to seize the private property in the name of the public good in Parramatta a few years ago. That issue when to the High Court. Clearly this issue is heading in the same direction.

Rudd is clearly dividing the country on an important issue. It is a surprising issue. One would have hoped that we would have developed a respect for people's property centuries ago, but because of the intellectual ambivalence or inefficacy of a great many Australians, the prospect of individuals or governments stealing wealth from others is just controversial. We might have some sympathy for a person without moral guidance, if they resorted to stealing, then we might appreciate their 'grab for cash' in order to feed themselves.

The problem is that such arguments are not about 'needs' trumping rights (or wants), but about the litany of non-thoughts, non-decisions which manifested in that person needing to steal. Why did he become a thief when he could have become a productive person. No positive influences. So what type of role model is the Rudd government when it seeks to expropriate the wealth of Australians, and why is it opportunistically stealing this cash after just having passed through one of the most glorious market conditions the country has ever seen? Its not even short for cash. This is all about power over money. Rudd is not content to marry a multi-millionaire, he has to extort a thousand more besides. Legally of course. Its a fine line under fascism. All you have to do is offer the 'appearance' of a concession to enough voters, and they will sell their souls for some short range benefit. The strategy is old - divide and rule. This month the target is miners. In a few years, the Rudd would have diminished the ego of Australians by another quart, and the extent of their repression would have sunk another decibel. The number of productive members in society would have shrunk another 0.5%, and tax receipts will need a kick up to help all those extra cases of mental illness and anxiety that have been added to the cues because Rudd and a litany of other political middlemen have offered 'carrots' to those who did not deserve them, and effectively bludgeoned the productive people in this country.

We owe the productive class in any country a great deal. We do not honour them by expropriating their wealth. The reason they evade taxes, the reason why your claims exceed your generosity, is because you did not earn the right to enslave them. You never will. It is an indefensible principle. Your justification that the 'common good' trumps the individual is an illusion long since dispelled. You are not convinced because no one has appealed to your better interest at the level which you need. There are two arguments:

1. Self worth: There are those who argue that personal self worth is intrinsic or unconditional, and those who argue that its conditional or earned. This debate is mostly conceded to the collectivists or socialists. There is a great deal of rationalism here and equivocation. Right to life should not amount to claims on others rights.

2. Cognition: So long as people think cognitive efficacy is based on intuition, the collective will, there will be no chance of achieving any sense of mental efficacy, and thus no prospect of anyone retaining self-esteem.

Kevin Rudd is undermining the intellectual capital of this country. The foreign capital which will find over markets is just the start. Australia's brightest minds will head offshore. They already have. There are already a million-odd Australians living abroad. They have left the 'lucky country'. I dare say, most of them did it for the money....a very concrete reason. Rudd has given them a more compelling reason....a desire to find a country where thinkers and achievers are valued, and not bludgeoned, both financially and intellectually.

If you want an example, of what life under Rudd will be like, look no further than NZ. NZ very much lives under Australia's shadow because it cannot attract skilled people. It therefore has problem with business starts. It therefore has to substitute departing skilled NZ'ers with semi-skilled imports from Asia with collectivist values. The problem with collectivism is that its indulgent and non-intellectual. They are the basis for simple jobs like waiting on tables. They are not the values which underpin business. To be fair to these migrants, they are the best in their country. The implication is that there is a brain drain from Asia, and then we have 0.5 million NZ'ers in Australia. This is a brain drain as well. They are not just chasing money, the underlying values are different.

NZ is not a country you would associate with aspirational values. The aspirational ones leave. This of course concentrates the parasitical souls who think it is acceptable to renounce responsibility and live off the efforts of other people. As parents, we know that life is about teaching kids the consequences of their actions. Its also why we don't spoil them. If we spoil them, these cease to value, they cease to achieve. Only humanity, the 'conceptual animal' possesses the stupidity to do that. Animals cannot afford it, no species can afford to renounce its only self-worth...its too fundamental. That is what Kevin Rudd is doing, by giving people an ultimatum between:

1. Perpetrator - if you support or suspend your judgement about this Resource Rent Tax

2. Victim - loss of wealth, loss of efficacy, disempowerment, brain drain if you allow the Resource Rent Tax to be adopted.

This is not a single issue...it is a principle that has to be grasped. The line should have been drawn not at some arbitrary point, but a principle - respect for property rights. This breach was made possible by the judiciary which sanctioned the enactment of arbitrary rule. This was a departure from Common Law, which is based on principles. When 'the people' allowed that, when the judiciary allowed that, government became capable of anything. Now we have a plethora of publicly-funded spineless academics advocating far worse. Yes, miners are forced to support a whole industry which because of their concrete-based thinking, will end up destroying them, or punishing them offshore.

The problem is that governments around the world are reducing the standards of value all around the world. There is no where to find. Eventually the internet transactions will be taxed. Google on 0.1% tax rate in Australia...it will have no where to hide. Google I think pays a 10% tax in Ireland. Not in future. There will be a litany of new regulations to stop it. And you will support this new tax or law because its in your 'narrow', 'concrete' interests. You will give no thought to the more abstract principles involved. By that point the number of intellectuals will be a fraction of a percent.

Basically there is not going to be anywhere to hide. You can confront the parasites in your government, or you can confront the parasites in Asia, where you might be compelled to live because money goes further. The problem is - they know you have money. The paradox is that they want to get out of their country. There is literary no where to hide from arbitrary government. On forums, I warn Americans coming to Australia or NZ of their false hope...they have this expectation that they can escape the parasites in their government...there is no where to hide. These people have to be confronted.

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Author

Andrew Sheldon

Resource Rent Tax

Applied Critical Thinking | www.SheldonThinks.com

Miners adopting wrong argument over resource rent tax

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The strategy to date of the miners is going to result in the government adopting this resource rent tax. The reason is the moral ambivalence of 'big business'. I am not suggesting for a moment that business is immoral, I am saying they are uncertain about their moral value, and thus not able to communicate a consistent ethical argument which would give their case the legitimacy which I know they have. The problem is that they, like the broader community, are a product of Christian philosophical values. Christianity and capitalism have existed alongside each other for a long time. Christianity has a legacy of retaining the 'moral high ground' whilst business was always about practicality. It is not surprising therefore that:

1. Government will appeal to the common good, the need to raise money in this financial crisis

2. Big business in contrast is going to argue that it needs to make a 'reasonable rate of return' if it is to sustain long term investment.

This is not a compelling argument. Big business will lose with this approach. Why? Because people, like business people, think short term. They are thinking they are in a financial crisis, they would prefer the tax burden to apply elsewhere. We don't have the ability to pay, 'big business' does. Business loses by this measure. By definition, business tends to make profits, and have a surplus. The public and government can spend without consequences because there is always someone to pick up the pieces. You might say that the government picks up after the big business fails, e.g. The HIH Insurance debacle. But that is only because of the community-wide implications of financial failure.

The proper argument

The decision to adopt a Resource Rent Tax is political folly, however it is just one piece of a succession of follies. They have their origin in the structure of government, and the values underpinning those structures. Unless big business repudiate that legacy of values and political structures, we are looking at the march of Rudd's fascism down Bond Street...or is it Bridge Street....Collins Street.

History is replete with examples of government ineptness, both as moral agents and executives. They spend tax receipts with no regard for consequences. They are not 'earners' of capital, they are expropriators. I would prefer money leave Australia than end up in the hands of government because I know that foreigner earned it. If we treat investors right, they will came back. Rudd's strategy will drive them away.

History is also full of examples of government applying a tax to one minority, and upon the principle of 'divide and rule', spreading their taxing powers to others. They do this by appealing to some majority. Eventually we end up all paying more tax because government by its nature is not efficient. They did not earn the right to occupy government. Understand that our politicians are not the best that our political system can produce, they are the worst. They are the best liars, the best manipulators of spin, and you deserve them because you allow them their ethical disposition to fester. Stamp out the cancer destroying politics in Australia! Require more of your politicians. Limit their arbitrary powers. Require laws to be based on principles. Require political parties to have coherent value systems.

Business needs to make this debate about ethics. It is business who is on the back foot on this issue because of their ambivalence. Business of course has a bad reputation because of the practices of a few, e.g. HIH CEO, Alan Bond, etc. The reality however is that it is government which allows these bad examples to fester. i.e. The lack of effective, under-resourced regulation in Australia, the arbitrary laws which facilitate loopholing of tax codes and statutory regimes. Accounting principles and Common Law do not allow this, the arbitrary 'creep' of statutory and tax legislation does! Stop it before it destroys the country; reducing it to a lower level of depravity than it has already fallen to.

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Andrew Sheldon www.sheldonthinks.com

Rudd's right to collect 'resource rent'

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We might question the moral legitimacy of Kevin Rudd's policy initiative to apply a 'resource rent' to mineral resources. Resource rent taxes are not a new concept. They are most often applied to the oil & gas industry. Royalties are something similar of course, however they are relatively small amounts. Another important difference is that royalties of 3-5% are charged upon revenue. The latest proposal by the government is to grab 40% of the 'excess profits' of business. What is more amazing, is the level at which these taxes are to apply.

Resource rent tax and royalties are a popular means of taxation for two reasons:

1. It's easy to trace the movement of materials, and production records also make it easy to hold parties to account for the tax.

2. It is very hard for businesses or resource developers to avoid the tax in as much as resources are usually fixed in-situ. You can't move a resource if you don't like a nation's political or tax regime. This is why Rudd's actions amount to extortion. Business has no choice. Of course if they did, they would be less inclined to develop resources here.

These are the practical aspects of the tax which provide some justification for taxing resources, however it is fair to say if practicality were the sole basis for taxation, then mining companies would have to pass on a great costs, and we might have a great deal of difficulty affording products made from these resources.

Resources are simply things which possess an economic value; whether water, minerals, land, trees, etc.

What about the ethics of the tax?

There are a number of ethical considerations which justify the governments expropriation of wealth from people generally, and mining companies in particular in this case:

1. Right to tax based on the democratic tradition which grants the majority the right to impose its will upon the minority (as conveyed) through the representative parliamentary system.

2. Government ownership of land based on the proclamation of Australia as a British protectorate, later ceded to the people of Australia, with the Australian government as its custodian.

3. Government statutory provisions for the ownership of resources and certain public lands. Usually these resources are defined on the basis of depth below ground level, distance from perennial drainages, from shoreline or as simply the edge of the continental shelf. These proclamations of course need to be supported by alternative or competing government claims. In most cases these claims have long since been settled. The Timor Sea Gap being a recent exception.

The fairness of the resource rent tax

There is some justification for a resource rent tax if you accept the public ownership of resources. This raises the question though as to whether government should control any rents collected, and how might it otherwise be dispersed. Might it be negotiated between vested interests on the basis of principle or decided by the government. Clearly there are conflict of interest issues. I personally would prefer a court approved corporate system, and that might favour the proceeds being used to facilitate the provision of justice, which is currently underfunded.

The other issue is the level of tax. It would seem unreasonable for the government to be able to 'extort' a higher level of tax from one group (i.e. miners) because this group is 'easy pickings'. The fact that miners have no capacity to avoid the tax should not be justification for imposing it.

Another consideration is the extent to which the mining company has actually added value to the resource, or paid for the resource. i.e. Iron ore resources in Australia or coal seam gas are in-situ; i.e. Relatively easy to find, and essentially known to exist without much doubt. It is merely a question of exploration to delineate a bankable resource. In such cases, the miner is not really adding value beyond that which was not already known. In contrast, a gold explorer does find resources which were 'blind', and they require a great deal more effort to delineate. The same is true for conventional oil & gas.

The appropriate way for the government to handle this issue might be to establish the royalties before areas are released for exploration. It could be a basis upon which competitive tendering is undertaken, or perhaps the government prefers a fixed royalty and a floating tender price.

The use of resource rent funds

Another question is what the resource rent tax receipts should be spent upon? I would suggest they seem best suited for general expenditure since an allocation to infrastructure development would lead to a worse outcome.

Current situation

In the context of the current situation, the Rudd government is proposing to impose a tax which is not a priori. The damage has already been done because investors have marked down the value of these projects and the companies which own them. The government in so doing has done irrevocable injury to the interests of shareholders. That should in itself be grounds for the Governor-General to dismiss the Prime Minister from office.

Clearly, there are two issues:

1. The inappropriateness of levying a fee for which the people or business can have not prior notice.

2. The inappropriateness of the government levying any tax

3. The desire of people for business to be taxes - because it might lessen the future burden on them. This is the 'divide and rule' principle of government. The government is more strategic here because they have the miners and banks attacking each other when they should be working together to dislodge the Australian 'fascist' government.

It is no accident that we have a fascist government. Rudd did not blow in with the last storm. He is but one of a succession of fascists, and he fits remarkably well with the contemporary values of Australia, in fact any Western society. It is societies values which have to be challenged. Business will not win this debate unless they engage in a pronounced media campaign to capture the minds of the Australian people.

The fairness of government's powers

The problem with this approach to governance is that it is by its nature unfair. It is destined to place an unfair burden upon the minority in as much as the majority has the power. The resource rent tax, which imposes an unfair burden upon resource companies (and its shareholders) is an example of such abuse. The existence of the Senate was intended to protect the people from precisely this form of abuse. The Senate often fails in this regard because the Senate comprises party members affiliated with the parties in the Lower House. The consolidation of representation was not entirely expected when it occurred after Federation. Irrespective of the 'spirit of the law', it can be construed from the structure of our democracy that there was the expectancy that reason would be the standard of value in our parliamentary system. Why do I think so? There are several reasons:

1. The parliament is required to act in accordance with the Constitution. The standard of value in this regard is reason, as adjudicated by the High Court. The way in which the government proposes such bills, debates bills, but acts without regard for the interests of minorities (as the 'spirit of the Constitution' requires) is testimony to the fact that parliament has become an instrument for the imposition of arbitrary, fascist rule. It might have a democratic 'err of legitimacy', but in fact such laws are in defiance of the law.

2. The Constitution established a certain number of seats in each house of parliament. It established seats, as opposed to groups of committees, because individuals representing the interests of members were intended to act based on their judgement, and not to subjugate it to political parties, which since the 1910s politicians have given greater allegiance.

3. The very existence of the Senate implies a spirit of principled policy making. So does the requirement for the High Court to interpret or oversee the actions of the parliament. These twin considerations imply that the parliament was always intended to act with due regard for principle, and that arbitrary policy which conveys a strategy of 'divide and rule' by government is really an act of extortion rather than good and proper government.

4. Lastly there is a requirement for the Australian parliament to act in accordance with the Constitutional requirement of 'good government'. The High Court has left this concept open, and it is also a very powerful basis for restricting the arbitrary powers of government. If the concept was not intended to protect 'principles of law', what was it intended to protect? The arbitrary power of the mob? (be it legitimatised by democratic vote).

The limiting of the parliaments powers to make laws is an important measure. It is however more important that any moral agency acts in accordance with principle to ensure equal policy for all Australians. The reason why statutory law is displacing Common Law is because it is entirely incompatible with it. The reason why government is able to expropriate from others because it targets minorities, and slowly universalises the arbitrary measure. i.e. Taxation was first imposed on the minority of rich people. Had the poor known they would be paying tax (and probably more) they might have thought otherwise of their seeming advantage.

I invite any and all Australians interested in supporting a High Court challenge to limit the arbitrary powers of parliament to visit our website Judicial Analytics, and register your interest.

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Andrew Sheldon www.sheldonthinks.com

Bankers and miners behaving like children

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One of the saddest aspects of this debate over Resource Rent Tax (RRT) has been the strategic idiocy of 'Big Business'. Rather than working together and arguing that the government has no right to do this, they are behaving like children in a 'tit-for-tat'. Read the following article and you will see what I mean. The mining industry is arguing with the banking industry about who pays more tax. Duh!

They should be working together to attack the government. This is why people pay taxation because they concede the moral imperative to the government. They concede that the government has the right to unilaterally and arbitrarily expropriate wealth or income from whoever they wish. As long as they do this they will pay a huge price - they will lose the war.

As much as I might think banking CEOs are unprincipled pricks who behave unethically, this is a time to see where that policy is going to hurt you as a shareholder in mining projects, or even any taxpayer who is ultimately going to end up in a socialist 'paradise' under Red Ruddy.

This is just like in the 1800s when the poor were on the sides of government when they accepted 'taxation of the rich'. Now we all pay excessive amounts of taxation.

The implication is that the banking industry ought to be on the side of the miners....if only because they would like to see miners able to develop projects so they can earn more interest income.

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Andrew Sheldon www.sheldonthinks.com

Placing your trust in govt and mining CEOs

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You might have expected a defense of our freedoms from a Liberal Party. Rhetorically they are the people one would tend to look to for such a defense. But the best they can do comes from Andrew Robb, Liberal Party President (if I'm not mistaken):

"This is a monstrous action and my expectation is that this won't come to the parliament until next term. My expectation is that it would be either dumped or fundamentally changed".

You have to understand that 'explicit' ideology is so old-fashion. They prefer instead the pragmatic, behind closed doors approach which does not alienate voters who are morally ambivalent about principles. The problem is that parliamentarians are going to love the idea of government controlling the extra cash. The idea that its negotiable is a problem. The fact that Liberals are ideologically non-committal is a problem. This is despite the fact that Liberals have all the rhetoric about freedom on their website, but note how it does not translate into action. They just describe it with adjectives like 'abhorrent'. It never leads to any 'verbs' or education. That is what this website is about. We place the ideology back in liberalism.

This is why representative democracy ultimately leads to fascism. Its all about numbers and not about principles. Principles are so 1960s. Well ok, 1920s since the principles of the 1960s were arbitrarily constructed.

The justification for this intervention by the government is of course to take what is readily available, and what can otherwise not be withdrawn. You cannot move mines. Really its extortion. Consider that the tax will mean that the mining industry will be paying 55% in the dollar, whilst based on reports, Google is paying almost zero tax in Australia, by transferring profits using clever accounting to Ireland.

We have long complained about the unfairness of the taxation system and the arbitrariness of it, and the fact that one arbitrary measure leads to another as business finds loopholes. You can patch up arbitrary law which have no context. The arbitrary is arbitrary because it does not relate to the facts of reality. That's why there are always holes in it.

The government has suggested that the 40% tax would be levied upon the excessive or 'super' profits of miners from 2012 onwards. The proceeds will be used to finance corporate tax cuts, boost retirement pension savings and build infrastructure.

The problem with this is that there is no need for government intervention on these matters. These companies can fund their own infrastructure, and should be required to do so. Why do we want governments, with no business acumen, to be building railways and ports. In their hands it will be simply corruption of people and the system. Retirement savings are the concern of retires...why should miners fund these. By their very existence mining companies are already funding savings in Australia by pushing up incomes, property prices, etc. Mind you, the government is artificially doing that all by itself. This policy is itself an effort to force savings in the country. If land was freely subdivided, the value of your house would probably halve.

Clearly the mining industry should not be used to finance tax cuts, as they already pay the most tax, and are only targeted because the government is too lazy to make tax cuts. It does not have management skills, so it passes the costs onto taxpayers....usually the weak and vulnerable. In this case the mining industry because they cannot shift their mining projects offshore.

My problem is the approach of the mining industry. The government likes to deal with BHP Billiton and Rio Tinto and Fortescue Metals. Why? Well, because these companies represent:

1. Big business - manager 'CEO' class running global conglomerates

2. Hugely wealthy individuals like Andrew Forrest

Why would voters have any sympathy for this class of people. There are so few 'Twiggy's', so why care? The reason is that this is why government is un-principled and gets away with this type of behaviour, because it targets minorities, who it thinks you will have no consideration for. I have no idea whether Andrew Forrest has any principles, I just think that his life means something to him, so if we are going to have empathy for animals in this day and age, why don't we have any for people, no matter how rich. Because I suspect, and maybe I'm wrong that business is more than money to Mr Forrest, just as your career is more to you than just money. In fact given that Andrew Forrest has more money, I'm willing to guess it means relatively less to him than you. This might make you think, all the more reason to take it from him. But lets ask what impact that might have on his estimate of the parasites who expropriate his money. Ask yourself that, and you will understand why business ethics sux in this country, and everywhere else. Its because you have no respect for their interests, so why should they have any respect for yours. By engaging in this 'dog fight' we all risk moving towards anarchy or fascism. Look at the street riots in Greece because of government debt debacle.

Another problem is having a 'manager' class of CEOs, i.e. The CEOs of Rio Tinto and BHP Billiton, controlling your money as investors. They ultimately have no interest in this outcome. You might think they do because they have share option incentive schemes. The problem is that they have little control over government policy. My guess is that their options incentive will be adjusted to reflect the higher taxes these corporations will make. The implication is that shareholders have no voice....just Twiggy. That lone individual. My guess is that he's been too busy making money over the years to develop any grounded & coherent abstract principles. We live in hope, because I have no confidence in the other 2 CEOs heading this industry 'representation'.

I wanted to be a CEO like Andrew Forrest when I was 13yo. I studied geology, mining, finance, accounting. But I also studied philosophy, and learnt how pathetic people think and could not see myself surviving living on their terms. So I just became an investor, and when I knew what I was talking about ....I started writing. In those days, the Australian Financial Review used to have detailed news about how these corporate entrepreneurs did their deals. The newspapers are simply press releases and mindless editorial these days. No investigative journalism. Industry-prepared pieces with advertising.

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Andrew Sheldon www.sheldonthinks.com

Tax office abuse of arbitrary law

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The tax office in many countries has been able to adopt arbitrary law because of the power granted to it by their legislative systems. The approval for unethical laws is often initiated in times of crisis such as war, famine, natural disaster and civil unrest. When these problems dissipate the government does not renounce its powers. On the contrary, they find a justification for the civilian application of these laws which serves them rather than the country. One should be very cynical about the powers given to politicians. There are cases where governments have even overridden the law to impose laws that were not enacted in accordance with ‘due process’. A good example is the Internal Revenue Code in the USA, adopted in 1919. It breaches the U.S. Constitution, but a number of state court judges have refused to recognise the constitution, asserting that it is not relevant. Crazy but true. Why would a judge say such a thing? Because he is paid and punished by the people who would be threatened if such legislation were repealed. It becomes apparent that the only way this abuse of power will be ended is:
1. If politicians feel that they would be open to the same threats of intimidation as they inflict on people (not that I am sponsoring anything).
2. If people peacefully demonstrate in large numbers for an end to abuse at the hand of government.
It would take at least 50,000 people to demonstrate to get some action on this front. They can’t place 50,000 people in gaol without someone questioning the policy. There are plenty of people who can make ethical arguments against taxation, the issue just needs supports with the courage to assemble. I believe we still have the freedom to assemble. Mind you, you need police approval.
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Andrew Sheldon www.sheldonthinks.com

Shifting the goal posts

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One of the most insidious aspects of the tax acts is the capacity of the government to make arbitrary laws, and often these laws are difficult to interpret because they are arbitrary. This is of course a contradiction inherent in the constitutions of Western governments. But here we are 100+ years later still accepting that laws should be arbitrary. Of course voters would draw a line at political killings (even though they occur in the Philippines). Imprisonment is ok, as we saw with Pauline Hanson in Australia, Anwar in Malaysia, Mandela in South Africa. World governments turn a blind eye, not to mention the people of his own country. Well I guess some did engage in clashes with the South African police.
It ought to be apparent that governments are not defenders of freedom or justice as they are supposed to be. Quite apart from the injustice of the judiciary which has not evolved in hundreds of years, governments just get worse. Less is spent on justice, and the bulk of that goes on enforcing arbitrary laws that are as much breaches of justice as they are legitimate cases of justice. Far more money is spent on corporate and personal welfare than is spent on justice, and thats a very inefficient justice system.
Owner of the Nine Network of Australia (Channel 9) once said 'if anybody in this country doesn't minimise their tax, they want their head read, because as a government I can tell you, you're not spending it so well that we should be donating more". He made these statements before a government Senate inquiry. Aside from the inefficiencies, there is the lack of direction, change in direction, and the burdens placed on tax payers.

For example, you consider your tax burden too high, so you set up a company to reduce it. The government then cuts the tax rate making personal tax relatively more attractive, so the requirement for a company is no longer appealing. In the state of NSW, the government levied a land tax that undermined the property market. This was of course unfair for the people who had just bought land. So what is wrong with this political expediency? Well aside from lacking any consultation with NSW voters, it highlights a total lack of strategy and a lack of consideration for voters. Now, do you think the opposition is any better? Did it spell out the basis or principles uponn it would sign up to a war in Iraq? Nope. Strategic reasons? Well yes, nothing to do with justice, it was political expediency (strategy).

I was surprised to find out that the Australian government is helping the Philippines government execute its Local Government Code of 1991. Yes, its taking some time. The reforms are intennded to ensure that local governments act in accordance with long range 20-year plans which are further broken down into 6-year plans to match the term of each local government. It sounds very sensible and farsighted. The question is - Why don't we do the same at Federal government level in Australia?
The bigger paradox is that the Australian government is fighting for democracy in Iraq and Afghanistan when its we in the West who are the prisoners, and Western governments are just as much the terrorists. I'm not defending the Arab terrorists because they are mindless brutes. If there attacks were against the Fed Reserve I'd have some sympathy, but they don't have an argument. No credibility there. But Western government's are worse because they should know better having been raised in a semi-free country.
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Andrew Sheldon www.sheldonthinks.com