OECD countries are making progress at reducing their heavy levels of Government expenditure. The following OECD countries acheived significant cuts to government expenditure/GDP between 1993 and 2002. Country 1993 2002 Difference Finland 59.1 41.8 -17.3 Ireland 40.8 26.0 -14.8 Sweeden 67.5 52.7 -14.8 Hungary 56.2 42.0 -13.3 Canada 49.0 37.0 -12.0 Norway 51.0 39.7 -11.3 Netherlands 49.9 39.8 -10.1 Italy 56.4 46.6 -9.8 Spain 47.1 38.0 -9.1 UK 45.5 39.0 -6.5 Australia 36.2 30.5 -5.7 USA 34.1 28.8 -5.3 Government expenditure/GDP, 2002 is a forecast. I think these figures are significant and show the effect of globalisation, a force which will intensify as global financial markets integrate barriers to international investment and trade fall and labour mobility increases. Falling costs of financial privacy and the development of internet finance will erode the ability of governments to tax foreign sourced income and more countries will adopt a source based taxation system. The more common use of source based taxation will increase the extent to which resources will move in response to changes in tax rates, and thus intensify tax competition on capital. Tax competition on labour, the deregulation of the labour market, liberalisation and privatisation of tertiary education and its funding, can only result from increased labour mobility, which I dare to claim is actually occuring, especially within Europe. Labour mobility within Europe between countries of significant per capita GDP and skill disparity will create a labour market with much greater after tax wage disparity between skilled and unskilled labour. This will result in a flood of private resources into tertiary education and sharp reduction in the extent to which governments can redistribute between skilled and unskilled labour. The result is that the connection between personal marginal productivity and living standard will be restored in Europe and welfare dependency and redistribution will be much reduced. Its hard to overestimate the political effects of a continent of largely skilled people who skill has come from their own thrift, investment and contribution to their own betterment. David Hillary --- You are currently subscribed to e-gold-list as: archive@jab.org To unsubscribe send a blank email to [EMAIL PROTECTED]
