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Maxim Institute - Real Issues No. 323

Real Issues No. 323 - Just Tax, Welfare, Volunteering Maxim Institute - real issues - No. 323

16 October 2008 www.maxim.org.nz

Is it Just Tax?

The shaping of our society Dumping the dole? Connecting for a cause

IN THE NEWS Foster care shortage in South Australia House of Lords reject 42 days NZ Votes Political Debates An invitation to 'Breakthrough New Zealand'

Is It Just Tax? The Shaping Of Our Society

Tax and the economy are issues on many people's minds at the moment; raising questions that all governments and societies must debate. Questions of fairness, compassion for those in need and the limits to freedom, are all foundational to the tax debate. They help us define our society and influence what we think of policies like progressive taxation, Working for Families and KiwiSaver tax credits. These foundational issues are addressed in a new discussion paper from Maxim Institute: Is it Just Tax? The shaping of our society.

The paper questions assumptions behind the tax system and its policies, beginning with the popular debate about 'fairness' or justice. 'Fairness' is often pursued by policies designed to alter people's outcomes, like redistribution to achieve greater income equality. However, the paper argues that justice actually depends on treating people equally, and that it must go hand-in-hand with a moral obligation to those in genuine need and hardship. This casts doubt on policies like progressive taxation, which treats people unequally, and Working for Families and KiwiSaver tax credits, which benefit many who are not in need.

Tax policy also raises certain issues of freedom. For example, the increasing reliance on tax incentives poses subtle, but real implications for freedom, as the incentives attempt to shape people's actions. More obviously, paying taxes is compulsory and therefore inevitably limits freedom. Of course, freedom must be limited in some way, and the paper argues that the need to protect society's common good from harm defines the limits of freedom. This then should also dictate the boundaries of taxation. Again, this leaves current policies open to question -- the 'poverty traps' (disincentives to earn more) and 'marriage penalties' (tax structures that disadvantage couples) of Working for Families are an example of tax policy creating threats to the common good, and so are high levels of taxation which leave people dependent on government provision.

Tax reform is a hot topic these days, but one where many fundamental assumptions go unquestioned. Big picture questions about the shape of our nation, the way we care for those in need and what it means to be a citizen and pay our dues are often drowned out in a welter of calculators and dollar signs, and unchallenged rhetoric. Connecting the debate about change to the bigger picture is the best way to guard against short-term and superficial reform, and gives us a system that taxes fairly, embodies genuine compassion and respects freedom.

Read Is it Just Tax? The shaping of our society or purchase a hardcopy http://www.maxim.org.nz/index.cfm/Publications


Maori Party co-leader Tariana Turia launched the Maori Party's economic policy in Flaxmere this week, and re-ignited the debate on welfare by calling for the dole to be reformed. Asked by TV3 News whether she wanted the dole to be scrapped, Mrs Turia said, 'Yes. Absolutely. I'm opposed to the dole. I have to be very frank with you -- I don't think it is healthy for the spirit of our people, to be getting money for doing nothing.' She called for 'the government to make work' to help foster a 'work ethic' among Maori.

Mrs Turia's remarks show a bracing awareness of the realities of the welfare system. The support of the destitute should be the aspiration of every decent human being and a hallmark of our society. But the dole should be for those with no other option, who are genuinely unable to work. A positive culture that is good for people is one which encourages and values hard work and the creativity and productivity which goes along with it. There is also a sense in which by working hard we honour the way others work and in so doing take our responsibility as citizens seriously. Getting people into work is a win for all concerned.

The challenge then is 'how?' Using government funded work schemes is hardly the answer for permanent change. If we are to see genuine progress in this area we need to be thinking more creatively, we need to build a system that helps people to be accountable, and we need to do a better job mentoring people off the dole into genuinely useful jobs that will give those involved a strong sense of satisfaction and accomplishment. Although benefit numbers have been declining due to a good economic climate Mrs Turia is right -- we cannot afford to leave so many people without a chance at a future. Welfare reform should be high on society's agenda, and it is positive and progressive to hear someone stepping up to the issue which continues to weigh down so many people.


Many people are intuitively aware of the value of volunteering and are stirred by the issues that they see or hear about, but do not know what they could contribute or how to go about doing that. Simultaneously, many organisations need support but are not sure where to find willing people. The problem of information is one of the big challenges for civil society as different pockets of the community remain isolated from one another and unaware of the needs or potential resources that may exist either nearby or far away. The internet has the capacity to help remedy this divide. A new website has been launched that aims to connect people and organisations with similar passions, helping the non-profit sector raise its profile and informing citizens about how and where they can volunteer.

The website www.gomad.co.nz, has been created by Good Magazine and Intrepid Travel in order to conduct the Intrepid Volunteers Challenge, aiming to bolster volunteering in New Zealand. The site functions as a social networking site, in which individuals can fill in a description of themselves, creating an online profile about who they are and what they are passionate about. At the same time, organisations can fill in information about what they do and what needs they have, giving people and organisations the opportunity to connect with each other. The organisations and the interests of individuals are diverse. One person says that they can volunteer in health or nutrition work in Wellington, while another is interested in corporate volunteering internationally. Each person who signs up has a profile space, an inbox, information about events, and the capacity to interact with other individuals or organisations that spark their interest.

For the volunteers who participate in the 'Intrepid Volunteers Challenge' there is an additional incentive. After a year, awards will be presented to those who have been most active in the challenge, with one person winning a volunteering trip overseas.

Intrepid Volunteers appeals to our prolific desire for adventure and the wish to impact the world. The introductory page of the site is splashed with the phrase 'want to change the world, click here.' The site is one small attempt to use available resources to contribute positively to the good of society. While the attempt is small and its effect yet to be proven, it has the great capacity to network and inform, a capacity crucial as needs and the resources to meet those needs can often be geographically disconnected.

Find out more about the 'Intrepid Volunteers Challenge' http://www.gomad.co.nz/



According to news reports, South Australian authorities stumped up $16 million dollars last year for 'emergency accommodation' for children in care -- including 'motels, caravan parks, B&B's and serviced apartments.' The temporary arrangements for 63 children came due to the shortage of foster carers in the Australian State. While emergencies are by definition unusual circumstances, the news report highlights the vital, and often overlooked role played by foster parents and families in giving children the stability and peace they desperately need. The role of foster parents is one of generosity and compassion, giving to children-at-risk open homes and open hearts -- in New Zealand, as well as Australia.


The House of Lords have voted against a measure that the British Government was attempting to pass that would have allowed suspected terrorists to be detained for up to 42 days before being charged with an offence. The Counter-Terrorism Bill, which passed through the House of Commons before being passed on to the House of Lords, was deemed an abuse of the principle of habeas corpus -- the principle protecting an individual from arbitrary detention by the state. The public fear of terrorism should not account for over-reaching infringements of basic civil liberties, a fact which was recognised by the peers in the House of Lords.

Read the Counter-Terrorism Bill 2007-08 http://services.parliament.uk/bills/2007-08/counterterrorism.html


With only five NZ Votes Political Debates left, check out the website and find out when one is coming up in your local area.



On 3 November 2008 Maxim Institute will be hosting 'Breakthrough New Zealand,' a lecture by Dr Samantha Callan, a family policy expert from the UK. The lecture will examine possible lessons to be learned for New Zealand from the extensive UK report Breakthrough Britain, which looks at reducing the costs of social breakdown.

The lecture will be held at The Gus Fisher Gallery, The Kenneth Myers Centre, 74 Shortland Street, Auckland starting at 6.00 pm. Drinks and canapes will be served. Entry is free.

If you would like to attend the event please RSVP to Maxim Institute's Events Co-ordinator, Kerry Alemann by Monday, 27 October 2008.

Find out more about the event http://www.maxim.org.nz/index.cfm/Events


'[A] re-balanced tax system will require us to take greater responsibility for our own well-being and for the well-being of those around us. This devolution and assumption of personal responsibility and concern for others, to the point of personal sacrifice, will require cultural change. It will, however, allow justice, freedom and compassion to flourish better than at present ....'

Alex Penk, Is it Just Tax? The shaping of our society


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