Writer
Michael Keating
Michael Keating is a former Secretary of the Departments of Prime Minister and Cabinet, Finance and Employment, and Industrial Relations. He is presently a visiting fellow at the Australian National University.
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MICHAEL KEATING. How Useful and Reliable are the Budget Projections?
The Treasurer wants us to believe that the Government has a credible plan to restore the Budget to a surplus and cut taxes at the same time. This conclusion is based on the projections for revenue, expenditures and the budget balance incorporated in this year’s budget. However, both Ross Gittins and I have separately criticised Continue reading »
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MICHAEL LAMBERT. Review of Fair Share by Stephen Bell and Michael Keating , Part 1
The topic of economic inequality has become an area of strong research and academic interest , and Fair Share: Competing Claims and Australia’s Economic Future, by Stephen Bell and Michael Keating, published by Melbourne University Press, adds to an illustrious group of authors who have tackled this complex subject from a range of perspectives. (These Continue reading »
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MICHAEL KEATING. 2018 Budget comment; Part 3: The Turnbull Government’s Priorities as revealed in the Budget
In this final Part 3 of my comments on the 2018 Budget I discuss what this Budget reveals about the Government’s values and priorities, and its performance compared to those targets. Continue reading »
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MICHAEL KEATING. Budget commentary, Part 2: Sustainable tax cuts for low-income households
Part 1 of this series of Budget comments criticised the credibility of the Government’s projected return to a budget surplus and argued that the proposed tax cuts were therefore not in fact sustainable. In this second part I will argue that nevertheless some tax relief targeted at low-income households should be supported, and other alternative Continue reading »
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MICHAEL KEATING. 2018 Budget Comment (Part 1)
This year’s comment on the Government 2018 Budget is in three parts. Today, I comment on the proposed tax cuts, which are the signature feature of this year’s Budget. I conclude that there are real doubts about whether those tax cuts are sustainable in the longer-run. The second part of this series discusses why tax Continue reading »
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MICHAEL KEATING AND JON STANFORD. Australia’s strategic risks and future defence policy; Part 2: Future defence strategy, capability and submarines
In this second article we discuss the need to develop a defence strategy that involves shifting from a force structure designed for coalition warfare to one optimised for the independent defence of Australia. We focus on the requirement for new submarines, given that these are the assets best suited for the prosecution of asymmetric warfare Continue reading »
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MICHAEL KEATING and JON STANFORD. Australia’s strategic risks and future defence policy (Part 1 of 2)
Part 1: Australia’s strategic environment and the US alliance Two years ago the government selected the French company Naval Group to design Australia’s future submarine (FSM). We were highly critical of the decision at the time for a number of reasons, including the excessive cost. In particular, we are concerned by the lengthy delivery schedule Continue reading »
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MICHAEL KEATING. Why Australia Needs A Stronger Revenue Base
Earlier this week the Australia Institute released an open letter signed by 48 eminent Australians calling for an increase in taxation. As we might have expected, the Treasurer, Scott Morrison, without any reflection, dismissed this call for higher taxes as “a numpty of an idea”, adding that “The idea that you increase taxes to grow Continue reading »
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MICHAEL KEATING- Wages, Profits and Economic Growth.
This article summarises the analysis in a new book, Fair Share: Competing Claims and Australia’s Economic Future, which examines the interrelationship between the stagnant economic growth experienced by most developed countries over the last decade and the increasing inequality in the distribution of income. Continue reading »
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Trickle down economics and the Emma Alberici article.
The ABC says that their decision to withdraw Emma Alberici’s article was because it represented an opinion for which there is allegedly no evidence. In fact there is plenty of evidence that increasing corporate profits will not lead to any increase in investment or employment and wages if aggregate demand continues to remain weak. Furthermore Continue reading »
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MICHAEL KEATING. The Trump Tax Cuts and Economic Growth
The forecast positive impact of the Trump tax package mainly results from a temporary incentive to bring forward business investment. This is irrelevant to the cuts in company tax rates proposed by the Turnbull Government, and cannot be used as vindication for their policies. Furthermore, the Trump tax package fails to address the fundamental flaws Continue reading »
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MICHAEL KEATING. Tax Reform and the Need to Raise More Revenue- A REPOST from August 2017
This article considers the future Budget outlook and argues that the key issue for tax reform is how best to raise the additional revenue that will be needed. The article builds on Ian McAuley’s recent post arguing that well-designed taxes can actually improve economic resource allocation, and this article further argues that if the additional Continue reading »
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MICHAEL KEATING. Trickle-Down Economics and a Company Tax Cut
Despite the evidence of the last few decades that ‘trickle-down’ economics doesn’t work, big business and its apologists in the media are calling for a company tax cut to stimulate investment. The reality, however, is that increased investment is principally in response to increasing aggregate demand. The required increase in aggregate demand in turn requires Continue reading »
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MICHAEL KEATING. National water reform- A REPOST from September 28,2017
According to the Productivity Commission’s draft report on National Water Reform, Australia is now viewed internationally as a world leader in water management. Nevertheless, these reforms continue to be challenged by special interests. In particular, the history of poor investment in irrigation continues, encouraged by the comfortable expectation that governments will not enforce the requirement Continue reading »
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MICHAEL KEATING. Inequality, wages and economic growth- A REPOST from July 31,2017
Changes in inequality and in the relationship between wages and productivity help explain the poor economic performance of many advanced economies in this century. Interestingly the Governor of the Reserve Bank indicated that Australia might be facing the same risks of inadequate wage growth, although he felt that ‘Australia’s monetary policy framework is better placed Continue reading »
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MICHAEL KEATING. The 2017-18 Mid-Year Economic and Fiscal Outlook
This Mid-Year review of the economic and fiscal outlook contains no new surprises. However, the balance of risks is that the outcomes will be worse than predicted. Clearly on the Government’s own projections, the nation cannot afford income tax cuts in the foreseeable future. Instead what this review reminds us, is just how threadbare this Continue reading »
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MICHAEL KEATING. The Productivity Commission on more effective government. Part 2 of 2.
The Productivity Commission’s findings regarding the effectiveness of Australia’s public services reflect the findings of many previous reviews. Fundamentally a change of culture is needed in favour of well-calculated risk taking and, I would add, greater independence based on the pursuit of evidence through comprehensive program and policy evaluation. Continue reading »
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MICHAEL KEATING. The Productivity Commission on more effective government. Part 1 of 2.
This article, the first of two which discuss the Productivity Commission’s recommendations for more effective government, focuses on how to improve Commonwealth-State relations, and fiscal disciplines and accountability. The conclusion is that the Commission’s recommendations are for the most part disappointing. They fail to take account of the practical difficulties in better matching taxable capacity Continue reading »
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MICHAEL KEATING. Tax Cuts: What can we expect? Part 2 of 2
In Part 1 of this series, posted yesterday, the conclusion was that restoration of a sustained Budget surplus would require a combination of expenditure cuts and tax increases. This second Part 2 finds that the projected swing from Budget deficit to surplus requires a swing of 3 per cent of national income. It then explores Continue reading »
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MICHAEL KEATING. Tax cuts – what can we expect? Part 1 of 2.
The evidence suggests that Malcolm Turnbull just doesn’t have the fiscal room to responsibly offer income tax cuts, which means it was very irresponsible to raise expectations in this way. Part 1 in this series of two articles examines the relationship between taxes and economic growth, and the demands upon the revenue to repair Continue reading »
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MICHAEL KEATING. Should VET be contestable?
The introduction of contestability into training markets is often cited as a prime example of the failures of privatisation. However, the totality of the evidence is rarely examined in support of this allegation. This article aims to fill this gap. It finds that a contestable training market can fail if not properly regulated, but now Continue reading »
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MICHAEL KEATING. Trump’s Economic Policies: Part 2 of 2
In Part 1 of this series of two articles, yesterday I examined the impact of President Trump’s economic program on the American economy. Today’s article discusses the impact of the Trump economic program on the rest of the world, and Australia in particular. The key danger is that Trump will further encourage a rise in Continue reading »
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MICHAEL KEATING. Trump’s Economic Policies: Part 1 of 2
President Trumps economic policies have so far received much less attention than his foreign and national security policies. The examination here and in a following article concludes that the economic policies are based on fundamental contradictions and are therefore bound to fail. This failure will be felt by Americans and by the rest of the Continue reading »
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MICHAEL KEATING. Can Parliament control Government Expenditure?-The Use of the Advance to the Minister of Finance
The High Court has upheld the Government’s decision to use the Advance to the Minister of Finance to pay for its survey of attitudes regarding same-sex marriage, and notwithstanding that funding for this survey was unlikely to gain parliamentary approval. Furthermore, the Court found that while the Finance Minister’s decision must be “formed reasonably”, he Continue reading »
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MICHAEL KEATING. Contestability and Defence Advice
Major defence decisions have long been made with a minimum amount of consultation. That is certainly true of the recent decision to give the French Naval Group a monopoly over the design and build of Australia’s next submarine. The way this decision was made seems to reflect a long-standing view that civilians are not competent Continue reading »
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MICHAEL KEATING. Is it legitimate to pay for a postal plebiscite using the Advance to the Minister of Finance?
This article questions the legitimacy of by-passing the need for Parliament’s approval by using the Advance to the Minister of Finance to pay for the Government’s postal plebiscite regarding attitudes to marriage equality for same-sex couples. Continue reading »
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MICHAEL KEATING. Electricity Prices.
Electricity prices are a hot topic at present. Amidst the welter of claim and counter-claim as to what is the cause of higher electricity prices, there has been remarkably little use of the available evidence. Continue reading »
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MICHAEL KEATING. Why Blame Neo-Liberal Economics: A Response
My previous article on Why Blame Neo-Liberal Economics, which argued that neo-liberal economics was not a main cause of increasing inequality, drew an unusually large and mostly critical response. While it is not feasible to respond to all the detailed points that my many critics have raised, in this response I propose to focus on Continue reading »
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MICHAEL KEATING. Why Blame Neo-Liberal Economics?
The claim is frequently made that neo-liberal economic policies are responsible for an increase in inequality. However, no supporting analysis is ever offered to sustain such claims; the obvious reason being because they reflect the author’s imagination and prejudices. Continue reading »
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MICHAEL KEATING. An appreciation of Ian Marsh.
Ian Marsh who passed away last week, was a highly original thinker with the genuine curiosity of a true intellectual. Ian liked to describe himself as one of the last ‘Deakinite Liberals’. This apt description reflected: Ian’s contributions to industrial policy, and especially how the state can help foster innovation, and Ian’s preference for a Continue reading »