Andrew Bartlett has been covering the possible tax reforms that Australia could benefit from . Craig Emerson also weighed in on the issue . But Emerson's website sucks and I can't find more information on what he is proposing. So I cannot be bothered discussing his policy ....

There is no polite way to say this. But compare Andrew Bartlett's website to Craig Emerson's . Andrew's is readable and accessible. Craig's is a rats arse. I wanted to get more info on what Emerson was proposing in terms of bracket creep. But on his website I can find nothing of use. Worse, his media releases are in PDFs.

Emerson got on the ABC feed, so congratulations, but I can't go into any more detail in his tax reform proposals because the information is not there. I don't live in Queensland, but my experiences here would influence my vote.

Bracket creep is an issue in the Federal taxation system, 30c on the dollar is taken after the 21K mark. In my opinion, any tax reform should occur at the lower tax brackets. Greater Sydney and Melbourne comprise about eight million people. Tack on Brisbane's two million and suddenly half the country lives in three cities. None of these cities are cheap to live in, and wages aren't appreciating at the same rate they were during the tech boom. Time to stop the bracket creep.

I also made a novel suggestion in trying to derive from first principles social organisation and an equitable means to pay for sustaining government (the dispossesive) ;

The goal of any social organisation is to foment prosperity. This can be taken as the starting point for an equitable system of taxation. Those that have prospered from economic liberty have a moral responsibility to not only maintain the present system of maximum liberty, but also to ensure those that have not prospered by it, are given every opportunity to achieve in this environment. It can be derived from this principle, that taxation should not begin until after the point of prosperity.

I took the point of prosperity as being;

I find using those that have half of the taxable income is a more equitable system of taxation. This would have the added advantage of removing the highly regressive nature of the current Australian taxation brackets. Those that have prospered carry an equal burden in ensuring not only maximum liberty remains, but also that those who have not prospered in such a system, get every opportunity to do so. This equal burden should be carried through to the taxation system. I recommend that;

A personal tax rate of 30% for those who earn income that is in the top half of all income. This would be adjusted every year. Currently this point is ~ $60,000

So basically no income tax until an individual earns over $60,000. The tax rate would be 30c in every dollar earnt over 60K.

More on Tax

• Unprogressive Australian Tax Brackets
• Emerson's Tax Reform
• Constantly Increasing Tax as Percent of GDP
• Government Expenditures and Taxation Levels
• Governments don't let other Governments tax for them
• The crippling cost to the Government.

The Matthew Principle is; the rich get richer, while the poor get poorer . The sugarscape model of trading sugar and spice leads actors in the game to distribute the wealth unequally. As a pure model it shows how weaker entities in a trading system can be disadvantaged. Yet economic systems through history have not ended up with extreme inequality and then remained in stasis once achieving that point. Obviously society, culture and even violence contribute to cycles of equality. Peter Turchin argues that equality is necessary for cohesive group action. He also argues that social instability in agrarian society acts as a dampening effect against increasing inequality.

Turchin argues inequality has ramification not only between economic strata, but within those strata; and ultimately these lead to a reduction in the ability for the group to act in the larger interest - or asabiya.

... the corrosive effect that glaring inequality has on the willingness of people to cooperate, which in turn underlies the capacity of societies for collective action. The effect of growing inequality is not limited to the escalation of "class warfare" between the poor and rich. Increasing inequality within classes also leads to intense conflict of commoner versus commoner and aristocrat versus aristocrat.

Turchin limits his analysis to agrarian societies. But a recent example of an outbreak of violence that was related to inequality was in Rwanda. While the western media chose to portray the killings as genocide, many of the killings were by Hutu of Hutu. The regions were non-genocidal killings occurred were largely agrarian and had traditions of passing down land to the sons in the family. Due to high population pressures and limited land for dispersal the land that could be given to the sons was not sustainable in size. Older members of farming communities owned up to four times the size of farm than younger members. Much of the violence and killing was against members of the same economic strata who had more land than others.

We may scoff at an inequality ratio of four. But those on the lower end of the scale did not have enough money or land to feed themselves or their families. Because we have chosen the organisational methods of democracy and capitalism, even our poor have the capability for calorific surplus. While Rwanda fell into violence that redistributed power as well as property, Australia is far more socially stable.

Turchin also argues that extreme inequality breeds revolutionary ideologues through the moralistic perception of social injustice and illegitimacy. He uses the example of the thirty years of warfare between the de Guise and Hugenot factions in France during the 14th century.

It is as applicable today with the Middle East. That region has nearly fifty percent of its population under 25. There is soaring unemployment - as high as 60% in Iraq , and there is massive inequality. Not only in the region between the monarchies and autocrats which control the oil wealth, but also with the West who enjoys a higher standard of living than the Middle East.

While the West assumes it is the recipient of the Middle East's rage, Iraq is showing that it is becoming internally focused. Whereas in the Medieval times when land became scarce and nobles too many - violence between nobles and landed gentry usually culled their number sufficiently that land distribution was sustainable once again - oil in the Middle East is not so easily redistributable. It will probably either have to run out, or be routed around with new energy technologies.

Where violence or pestilence in agrarian societies was a form of redistributing wealth by increasing the supply of land and the demand for labor; modern society does not have the same dynamics. The violence coming out of the Middle East will not change the fact that there remain a lot of unemployed youth, wishing for the western lifestyle and repressed by wealthy elites propped up by oil wealth and the West's insatiable demand for their centrally controlled energy crop.

William Bernstein argues that income equality is more important for political and social stability. Bernstein writes:

The paradox of economic growth is that the same mechanisms that create great wealth - secure property rights and rule of law guaranteed by an independent judiciary - also give rise to great inequalities in its distribution.

Private property provides a powerful incentive to produce wealth for oneself while simultaneously denying that same wealth to others. Wealth does trickle down to the rest of the population, but often not fast enough to avoid political strife and worse.

Modern political systems can be defined by how much economic inequality they are willing to absorb. The Nordic countries aim for equality first and foremost, while the US tolerates greater inequality than the Euro and Anglic nations such as Australia.

This has to be balanced with capitalism's ability to create a large homogeneous consumer group known as the middle class. Yet it is pretty obvious, in my opinion, that great inequality will lead to political violence both from the top and the bottom of the economic pile.

As a note: Peter Turchin's thesis is heavily reliant on income equality for effective group social action. Though he sees violence as a self-correcting or dampening mechanism when inequality gets too high.