Tony Jones ignorant of basic economics

“They grew the pie with the mining tax”.  Tony Jones

A short exchange between Tony Jones and Judith Sloan on QandA last night was about a fundamentally important economic concept, that of “sharing the pie”.

When an economy is growing and a nation becoming wealthier, the pie grows and there should be more for everyone. When the pie is static and the government takes more of the pie, there is less for everyone.

Jones was reacting to the government’s largesse of taking from the rich — the mining tax — and wantonly splurging it on families to compensate for its costlly carbon tax. For the benefit of the doubt, Jones may have been temporarily confused, but he suggested that this government largesse was an example of the pie getting bigger, rather than a good example of Norman Lindsay’s  “magic pudding”. “That’s not right Tony”,  cut in Sloan, and she explained that the government largesse was nothing to do with growing pies.

Tony Jones seemed to be displaying the classic socialist mind: Socialism is good until you run out of other people’s money.

UPDATE

Here is the transcript of the lesson on economics for Tony Jones on national television.  The transcript is from 31:10.

SLOAN:  There is a really important principle in economics and it is this. You have to create the wealth before you try to redistribute the wealth …

You really have to try and expand the pie … when you talk about egalitarianism, that comes at the expense of shrinking the pie. That’s what’s happened in Europe.

JONES: They just grew the pie with the mining tax.

SLOAN:  Well they didn’t. They redistributed the pie, actually.

JONES: They grew the pie with the mining tax, and then they redistributed the income from the mining tax to poorer working families in this budget.

SLOAN: That ‘s not right at all Tony. I mean tax is redistribution. there is no growing the pie. And in due course it may be quite inhibiting of investment and shrink the pie. If there was some magic pudding where you could increase the pie by increasing taxes, that would be a wonderful world, but doesn’t work like that.

APPLAUSE 

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