A Short History of Cake Taxation

April 21, 2011

There’s nothing like raw numbers to frighten you.

That’s how Australia’s deficit of 2.8% of its GDP looks compared to America’s massive deficit of 9.8% of its GDP. It’s no surprise Standard & Poors said this week there’s a 1 in 3 chance the US will lose its AAA rating. So … will Wayne Swan and Ken Henry apologise to Barnaby Joyce yet? (Here’s what the IPA’s Ted Lapkin said that means for Australia’s defence in The Drum today.)

In 2008 in the midst of the GFC the UK government unilaterally decided to spend £2.3 billion to bail out people in Britain who had deposits with the Iceland Bank – IceSave (what a name for a bank). Then the UK government sent Iceland the bill. Last week the Icelanders had a referendum on whether to pay – and guess what? They said NO! Again.

Michael Lewis, the author of books like Liar’s Poker, Moneyball, and The Big Short, had this on Iceland’s banks in Vanity Fair back in 2009. It’s worth a read.

It feels like deja vu all over again. In 1993 John Hewson couldn’t explain the effect of the GST on a birthday cake. In 2011 no-one can explain the effect of a carbon price on a birthday cake. The IPA’s Tim Wilson had a go this week in The Australian. And Tim knows what he’s talking about – he’s a trained ‘carbon accountant‘ (yes – there is such a thing). Here’s the recipe he used.

If you’re a Boris Johnson fan, read this 5000 word profile from last Saturday’s The Guardian. Boris and David Cameron have apparently hated each other since Eton.

In a win for the middle class, John Brack’s painting, Collins St, 5pm, was last week voted the National Gallery of Victoria’s most popular artwork. Tim Wilson picked this two years ago in his review of a Brack exhibition in the IPA Review.

Andrew Bolt is launching Gary John’s book Aboriginal Self-Determination from Connor Court Publishing in Melbourne on 2 May, and Mal Brough is launching it in Brisbane on 27 April. Details here. The book has a foreword by Bess Price who’s been in the news in the last week. (If you have no idea what I’m talking about, you obviously only read The Age or The Sydney Morning Herald).

Here’s some of what the IPA said this week:

PS – Bookings are now open for the most intellectually stimulating event of 2011. The Genius of Western Civilisation symposium in Melbourne on 24 June with Andrew Roberts, Peter Craven, John Hirst, Michael Duffy, Giles Auty, John Carroll, Sally Warhaft, Claudio Veliz, Ron Manners, Rabbi Shimon Cowen, Ian Harper, Michael Lawriswky, Greg Melleuish, Paul Forgasz, Richard Allsop, Cassandra Wilkinson, Julie Novak, Chris Berg, Jake Niall, David Daintree, and Rod Kemp (and me). Book here.

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