Labor’s HECS-for-watertanks plan has drawn some bouquets and brickbats in today’s press (it seems that if you talk about money and water, you can’t help but get media coverage). But I couldn’t help noticing that two of my fellow Ozeconbloggers are critiquing it from diametrically opposite positions. Harry Clarke takes the view that the subsidies should be means-tested (presumably meaning that he thinks the $250,000 cap is too high). Joshua Gans thinks that the $250,000 cap is a bad idea, since rich households impose a bigger negative externality on the environment.
FWIW, I recently estimated that the cutoffs for the 95th and 99th percentiles of the pre-tax household income were $196,000 and $311,000 respectively. So even if you think Joshua is right, we’re only blocking 3-4% of the population from getting the grant.
Update: In comments, Joshua and Harry take the opposite positions to those that I represented above.