Ryan Bridge: Beware the insatiable beast that is the State

It's like a hungry child screaming for more food, even though you've just fed them dinner and pudding.  Across the Tasman, Jim Chalmers, the Aussie Treasurer is facing high debt and deficit. They've managed to achieve the highest level of spending to GDP of any Government in 40 years, outside the pandemic. Sound familiar?  To deal with this, the IMF has just told them they should cut their cloth.  They've also suggested the Federal Government may need to bail out some states who are also weighed down by the Double Ds of post-Covid governance - debt and deficit.  Let's not forget this is the lucky country. The one that's been firing on cylinders we don't even have. The Flying Aussie Roos, it turns out, haven't quite been putting away for a rainy day despite making hay while the sun shines.  So, what do they do? There's a report out from The Australian this morning that they're considering taxing more.  Remember they already have a capital gains tax, the thing we don't have but Labour's promising to introduce.  But they have a discount on it for assets held for at least a year - once you flick it off you get half off the tax.  Their Treasurer has apparently been keen on getting rid of this discount before, and not ruling it out now.  It brings them an extra $10 billion in revenue.  So when parties here say they'll solve our problems with new taxes, is that the end of the story? Or does the insatiable beast come back for more?  This is a problem unique to government. In private business, as you well know, you only put prices up so high in order to cover costs.  People have choice about what they buy and they might put you out of business. So you cut costs. You innovate. You change and adapt to remain competitive.  Government's can raise taxes indefinitely.  The problem with some of them is that, given the chance, they would.See omnystudio.com/listener for privacy information.