In a recent interview with Leigh Sales of ABC1, the Prime Minister Malcolm Turnbull, claimed that he didn't need any evidence for his claims that a third of "investors" will leave the property market if Labor's proposals on negative gearing are introduced and that Labor's negative gearing reforms would "take a sledgehammer" to property prices.
The Prime Minister claimed that evidence or modelling was't needed. Plain common sense was sufficient:
"Well Leigh, your viewers tonight understand the laws of supply and demand," Mr Turnbull said.
Well, I have the conceit that I might actually know a little about property economics. So I raised the question on Twitter:
— Lev Lafayette (@lev_lafayette) April 28, 2016
Some people discussed the Tweet on Facebook and GooglePlus, but alas, the Prime Minister did not have the courage of his convictions to reply. Or maybe he was too busy - like he was too busy to check the research on negative gearing.
This entry is not to discuss that research (that can be for another time), but rather it is a brief comment on the failure of good public research to sway those who have power and vested interests influencing them. Malcolm Turbull, from all accounts a somewhat intelligent man, must surely be aware that Australia's policy of negative gearing has demonstrably failed to improve housing supply and is being used as a one of the worst tax rorts by the wealthy in existence. He knows this.
But it seems in his hope to retain power in the next Federal election he can run a divisive campaign that manipulates people who are not as well versed in economics, but are subject to emotive fear-mongering of the alleged collapse of the value of their home. He is also subject to the vested interests of the support base that makes up much of the Liberal Party of Australia.
Largest 10 average net rental loss by electorate
|Electorate||Net Rental Loss||Party||Representative|
|North Sydney||-$15,895||Liberal||Trent Zimmerman|
It is by the use of such tactical political maneuvering that poor public policy is implemented - and we can see who benefits.
Commenting on this Blog entry will be automatically closed on June 30, 2016.