An income-related loans proposal for drought relief for farm businesses

In 2004 the Commonwealth government is undertaking a review of its drought policy. This follows expenditure in excess of $1 billion on drought relief during 2002 and 2003 and comes only a decade after similarly large expenditure on support for farmers during the drought of the 1990s. Drought support for farm businesses has been provided within the framework of the National Drought Policy (NDP) agreed by Commonwealth and state governments in 1992 and at present is in the form of interest rate subsidies. This article suggests an alternative form of drought relief for farm businesses based on the Higher Education Contribution Scheme, which is more equitable between farmers, less regressive in its impact on tax payers and less open to politicisation.     

Book reviews

Journal of Chinese Political Science -     

Common law environmentalism

The necessity to control environmental externalities is almost invariably given as justification for command-and-control regulation and other forms of state intervention in related markets. When even mentioned, common law remedies that protected environmental rights for centuries are quickly dismissed as either being unworkable or ineffective. A review of the common law experience indicates that the rule of law can be effective in protecting environmental rights. Indeed, it is quite possible that common law was too effective, which led to special interest demand for statute law. The rule of politics may be more attractive to rent seekers than the rule of law and markets.     

Fiscal rules in the Canadian provinces: Abject failure or qualified success?

Most Canadian provinces have introduced legislation to require politicians of all ideological stripes to meet annual balanced budget (BB) targets. Critics of this type of legislation argue that it is unnecessary, confining, and subject to manipulation. We examine provincial balanced budget legislation before and after the Great Recession and argue that the response of provinces needs to be evaluated taking into account the multiple objectives of fiscal policy and the behavioural changes that the rules introduce, including creative non‐compliance. Rules should be evaluated on their ability to contribute to good fiscal governance rather than on their stringency.