Abbott’s war on the rest of us – And why there’s no need

Australias debt crisis

In the UK at the moment, there’s skyrocketing food poverty. And in the US, more than one in five American kids live in a ‘food insecure’ household. In both cases, inadequate low-income wages, high unemployment, and inadequate welfare are all significant contributors. And this is exactly where Australia is heading…

14.4% of Australians already live in poverty, well above the OECD average of 11.3%. And it’s on the rise. Yet our government is waging an outright war on social services, long-term infrastructure and low income earners, which will only make things worse. Here’s just a taste of what they’ve done (with a few at the end that they’ll probably do):

What he’s already done

  1. Increased the unemployment rate (yes, I know there are a lot of factors contributing to the increase, but there’s only one person to blame for the 50,00090,000 jobs that will go when we lose our automotive industry)
  2. Suspend the Wage Connect program, despite it being proven to deliver good outcomes for unemployed people (ACOSS policy director Jacqueline Phillips said, ”nearly half the participants in Wage Connect were in paid employment at the end of the six-month program”, compared to the third who were still employed after a Work for the Dole payment).
  3. Cut funding from Operation Newstart, an early intervention program for vulnerable youths
  4. Axed funding to the Alcohol and Other Drugs Council of Australia
  5. Abolished the National Housing Supply Council, which provided data and expert advice on housing demand, supply and affordability
  6. Abolished the Advisory Panel on Positive Ageing, established to help address the challenges the country faces as the number of older Australians grows
  7. Scrapped the Social Inclusion Board, which had been established to guide policy on the reduction of poverty in Australia
  8. Scrapped the Home Energy Saver Scheme which helped struggling low income households cut their electricity bills
  9. Cut funding to Indigenous domestic violence support services
  10. Completely defunded the National indigenous legal service
  11. Abolished the position of co-ordinator-general for remote indigenous services
  12. Abolished the National Office for Live Music along with the live music ambassadors
  13. Increased private health premiums
  14. Cut funding to public hospitals by half a billion dollars
  15. Taken away promised pay increases to childcare workers
  16. Taken away promised pay increases to aged care workers
  17. Repealed pokie reform legislation that combatted problem gambling
  18. Reduced tax breaks for small business
  19. Completely defunded Youth Studies Australia, a journal that provided research-based information and analysis on issues affecting Australians from early adolescence to young adulthood
  20. Axed Medicare Locals, the bodies were set up under the Rudd government to run community-designed health care programs
  21. Made cuts to the Disability Support Pension
  22. Cut funding to ACT family drug and alcohol rehabilitation program at Karralika
  23. Plenty more stuff that I haven’t had time to track!

What he’ll probably do soon

  1. Cut penalty rates
  2. Raise the pension age (they want to, they just have to get it through Parliament)
  3. Extend working hours for public servants
  4. Cut wages of public servants
  5. Abolish the Income Support Bonus that helps one million low paid families across the country
  6. Convert Start-Up Scholarships into loans, increasing the debt of 80,000 higher education students by $1.2 billion
  7. Cut Medicare rebates
  8. Introduce a fee to visit hospital emergency rooms
  9. Increase costs on medicines when the TPP comes in
  10. Axe employment brokering network Partnership Brokers

Yet in all of this talk about ‘austerity politics’, I’m yet to hear a single politician suggest pay-cuts for politicians or a reduction in their pensions. Funny, that…

And no need for any of it

The crazy thing about all of the above, is that there’s simply no need for it. Our politicians are talking about austerity, and Joe Hockey says we all have to help with the heavy lifting, but we have one of the healthiest economies in the world.

We’re one of only 13 AAA-rated economies, worldwide…

ScreenHunter_129 May. 15 00.01

 

We have the third-lowest debt in the OECD

ScreenHunter_120 Apr. 30 16.02

 

It’s been consistently low and isn’t spiralling out of control…

ScreenHunter_120 Apr. 30 15.47

(Unfortunately, I haven’t been able to find a more recent graph. Australia’s debt has increased since 2010 from about 11% to 11.7%. But during the same period, the OECD average has increased to around 70%!)

 

And it’s ALWAYS been way below the OECD average

ScreenHunter_115 Apr. 22 16.36

 

At least in the modern ear…

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Perhaps more importantly, our ability to service that debt is good

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Our inflation rate is low and stable

ScreenHunter_118 Apr. 30 09.52

 

Our unemployment rate is low and stable

ScreenHunter_118 Apr. 30 10.11

 

Our GDP per capita ranks 4th among OECD countries and is steadily growing

ScreenHunter_119 Apr. 30 10.23

 

And our Gross National Income (GNI) per capita is also well above the OECD average. (GNI measures the total income from production and services, by Australians, here at home or abroad, and discounts income from foreign-owned companies operating in Australia (e.g. 83% of our mining industry).)

ScreenHunter_119 Apr. 30 10.31

 

In fact, Independent Australia ranks our economy as the best in the world

IAREMGlobalRankingGraph

 

We spend less on welfare than all but 4 countries

ScreenHunter_115 Apr. 22 16.43

 

And less on unemployment benefits than any developed country…

Unemployment-benefits

 

We’ve done so for years. Below is our public spending since 1990, compared to other OECD countries…

social-expenditure-oecd

 

And Treasury says our total welfare spending (as a percentage of GDP) will be the same in 35 years as it is now.

Projected welfare spending the same in 35 years

 

Only 7 OECD countries spend less than us on pensioners (2010 total social expenditure, not just cash benefits)…

ScreenHunter_119 Apr. 30 15.29

 

And we have more pensioners living in poverty than any country except Korea

ScreenHunter_119 Apr. 30 15.15

 

Although we spend slightly more per capita on healthcare than OECD average, we spend less as a share of GDP (p.157):

ScreenHunter_118 Apr. 28 10.34

 

And importantly, despite the manufactured claims of ‘exploding healthcare costs’, we’re not increasing our spending at all per capita (p.155):

ScreenHunter_118 Apr. 28 10.45

 

Australia’s chief economists agree

CommSec chief economist Craig James:

Any Reserve Bank minutes show it becomes very clear the Australian economy is in good shape.”

AMP Capital economist Shane Oliver:

I don’t believe the debt is at a level that it poses a risk to Australia. It’s a million miles away from Greece, Italy, Spain, if we think we’ve got problems we’re kidding ourselves.”

HSBC chief economist Paul Bloxham:

I don’t think you could make the case that there is a budget crisis… because I don’t think we need to urgently get the budget back to surplus. It needs to be done in the medium term [with structural changes].”

Bank of America Merrill Lynch chief economist Saul Eslake:

The economy is still fairly soft. Growth is below trend. I don’t question for a moment the seriousness of the long-term problem. But I don’t see any particular urgency about 2014-15 or 2015-16.”

Barclays Australia chief economist Kieran Davies:

Most countries would be envious of Australia’s public finances as they currently stand.”

Deloitte Access Economics economist and partner, Chris Richardson:

We don’t need a surplus tomorrow. We don’t even necessarily need it in five years time. I’m more than happy with us getting back to sustainable fiscal finances over the long term. The politics would tend to suggest moving earlier rather than later but on the economics there’s no rush.”

BT Financial chief economist Chris Caton said the suggestion that Australia has too much government debt is:

Simply absurd.”

Honorary professor at the Australian School of Business, UNSW, Raja Junankar:

There isn’t a crisis. If you compare Australia to other OECD countries, we’re doing fantastically well… The government has come out screaming about debt. Everyone has debt, all major corporations, all major households have debt, as long as unemployment remains relatively low we’re OK, we’re not in for a crisis… And yet if you listen to some politicians they believe that Australia is in debt crisis — but actually, Australia is in a far better situation than pretty much every other country. Until the population start listening to some of the facts, rather than myths about the economy, the negative stories will dominate rather than reality.”

In a 2013 research paper, Raja Junankar also said:

if we listen to the politicians it appears that the Australian economy is suffering from a major crisis of ballooning government debt and an impending crash… in fact, Australia has a “miracle economy”.”

According to the Sydney Morning Herald, Bloxham, Eslake, Davies and Richardson believe long-term structural changes are necessary, not a risky short-term fix:

Ideas floated by the economists included abolishing negative gearing, taxing trusts like companies, broadening or raising the GST, reducing the capital gains tax discount and tightening tax breaks for high income earners’ superannuation. There was no budget urgency that would justify temporary ‘debt tax’ rises, they said.”

Early in April 2014, Reserve Bank governor, Glenn Stevens said much the same thing:

Put simply, there are things we want to do as a society, and have voted for, that are not fully funded by taxes over the medium term, as is starting to become clear in the lead up to the May budget. Our situation is not dire by the standards of other countries but neither are the issues trivial. A conversation needs to be had about this.”

Oh, and there’s also this statement from 63 of Australia’s leading economists, including former treasury secretary Bernie Fraser, former trade minister Craig Emerson, and various academics from the University of Sydney, University of Adelaide and University of Melbourne. Here’s part of it:

The austere measures contained in the proposed Commonwealth budget have been justified by fears that Australia’s public debt is expanding rapidly and dangerously, and must be arrested through a dramatic change in fiscal policy. These fears are misplaced. Australia does not face any present or imminent debt crisis… The most effective route to restored fiscal balance is to help more Australians find work, earn incomes, and pay taxes. But major and unnecessary reductions in government program spending and public sector employment would have the opposite effect… Major spending reductions by the Commonwealth government are economically unnecessary and socially damaging. The first priority of Australian fiscal policy should be to strengthen investment, employment, and growth. Government can and should pursue this priority without jeopardizing its long-run fiscal strength and stability.”

 

Even the people who wrote the Commission of Audit agree

Commission of Audit Chairman, Tony Shepherd:

We don’t have an immediate budget emergency.”

Commission of Audit member & former Howard government minister, Amanda Vanstone:

We’re doing OK at the moment.”

 

And the OECD has warned against a harsh budget

The OECD, responsible for promoting policies that will improve economic and social well-being, warns against cutting public spending:

heavy front loading of fiscal consolidation should be avoided

 

But isn’t ANY debt bad?

NO! In fact, many economists argue that a government should ALWAYS run at a deficit. Running a country’s budget isn’t like running a household budget. Most household expenditure is a cost, whereas most government expenditure is an investment. Here’s how Richard Holden, Professor of Economics at Australian School of Business puts it:

As Nobel Laureate and New York Times columnist Paul Krugman has pointed out repeatedly: government finances are fundamentally not like personal finances, for multiple reasons. One of them is the huge payback that social investments can deliver.

Government debt levels should typically not be zero. The Commonwealth government can borrow long term at around 5%. The social returns on wise social and infrastructure investments are often more than 15%. Not borrowing at 5% and lending at 15% is to miss huge opportunities. Governments can invest in projects that we never can as individuals: health care, schools, major infrastructure, national defence — and that’s what makes the large returns possible. It is just very different than thinking about maxing out your Visa card to go skiing.”

Specific to the current Australian situation, here’s what CPA Australia chief Alex Malley says:

Cutting spending in and of itself to meet an ambitious surplus target, conditional on implementing all the [Commission of Audit] report’s recommendations in their entirety, will not provide a roadmap for long-term success and could even exacerbate the problem.”

 

So why the war?

This is the question we should all be asking. Can you answer it?

 

Comments

  1. Suzy Gordon-Patridanon says

    Extremely well put and surely very hard for anyone to ignore (unless you’re a member of the Abbott clique).
    If all of those affected on your lists were advised of the 18th May march by March in March, it would produce a much more significant turnout on the day.
    Might just forward it myself unless thats already being done?
    Best regards,
    Suzy Gordon

  2. Brian says

    sadly i knew this would all happen, i told anyone who would listen he was not one to be trusted.
    yet another time i wished i was wrong..

      • says

        Hi Glenn, I get so stressed when I think I cannot change anything. What can we do?? Its funny I have spoken to many people & none of them, (including me) voted for this bloke? Also Hockey gets on his soap box huffing & puffing on about tightening our belts, so shouldn’t the belt be tightened around the top 1st?? When I retired 10 yrs ago my super, long service leave & 3yrs untaken sick leave was my pension. I paid 47cents in the $1.00 tax so I am reliant on the OAP.

        Help! Thank you Sunny Knight

    • GT says

      Are you guys serious? Abbott has his flaws but you would prefer the chaos of Gillard and Rudd? They were an absolute joke with zero idea, just completely out of their depth.

      What, do you think the Libs can fix all of Labor’s mistakes straight away? It took six years to stuff things up, that can’t be repaired overnight. Abbott is trying to improve the economy by getting rid of the carbon and mining taxes, but Labor/Greens are blocking it in the Senate.

      You have to remember Australia’s starting point, when Labor came into power we had ZERO debt. Of course we are better than other countries, we are the Lucky Country, blessed with vast quantities of natural resources. Yet for some reason Labor/Greens hate mining, the backbone of our economy and the source of thousands of Australian jobs. They get all jealous of the wealth, but aren’t prepared to get off their own backsides to run a business.

      Sure, it hurts to see cuts, but continuing on Labor’s trajectory was completely unsustainable. Try running your household budget the same way.

      However, I would like to see cuts to the ABC (just taxpayer funded ALP/Greens propaganda), the PPL and politicians super if they are cutting elsewhere!

      • Garry Mercer says

        I don’t support any party. However you should do your own research instead of believing what people tell you. The statement australia had zero debt on the election of the labour people is UNTRUE. Australia has always had roughly the same debt, and you’d be surprised how small it is, when you remove the private debt from the figures. In fact during most of labours reign interest on this small debt averaged minus 0.1%. So due to the rest of the world melting down, we were actually making a profit on our debt. What you are referring to is the balance of the budget. But remember this – Government is there to provide services from our taxes – It is NOT a business to make profit !!!! ANY TIME A GOVERNMENT MAKES A SURPLUS ALL IT MEANS IS THAT IT HAS REMOVED MORE MONEY FROM YOUR POCKET THAN IT SHOULD HAVE. The carbon tax has had ZERO effect on our economy, as you will see when its repealed. And direct action plans have been abandoned by all other countries including the US because they are too much burden on the tax payer. The mining tax is irrevelant, its a super profits tax, it hasnt cost mining companies a cent, and it never will, as the super profit threshold is at a level that will never be obtained, thanks to labours incompetence. If you throw enough mud some of it sticks. As can be seen by the furore over peter slipper – a man removed so another could get his seat., an act which carries a 12 year jail term in itself. A furore that boiled down to $1500 of free taxi rides to his staff, compared to the $11000 we paid for abbott to attend bicycle races. Or the $63 million dollars a day we are spending having our navy floating around looking for asylum seekers. But where is labour to point bout these facts and others? They cant even communicate with each other let alone with the public. The ABC should have increased funding so it can resume making quality programmes to sell overseas, instead of howards reduction causing it to purchased failed programming from england, that the british wouldnt watch.
        I agree with superannuation and the PPL, And i would like to see lobbyists outlawed, and end to focus group, endlessly repeated white and blue papers that are never acted upon, endlessly repeated reveiw comittees. royal commissions that expose more corruption among the people to instigated the commission than its intended targets, Axe the consultants and think tanks. The figures show we have the strongest economy in the world, there is nothing wrong with it, its booming. However, as the figures show, people don’t feel that way, and even the middle class are verging on poverty. Increase social support, it costs less in the long run. Stop blaming the carbon tax for your increased electricity. The entire NSW electricity network is being replaced with new equipment , unnecessarily. why? So that you can pay for it to be state of the art so the NSW government can sell it for half what its worth. The same thing happened to Telstra when the government sold a company worth $50 billion for $20 billion

      • says

        Thanks again for your comment, GT. If you have any verifiable evidence to support your claims, I’m sure we’d all be glad to see them.

        This post isn’t about Liberal fixing Labor’s mistakes. It’s about the government’s cuts to important investment, under the guise of a manufactured debt crisis.

        Labor clearly created the deficit, but it’s one thing to acknowledge that, and another entirely to assume that that deficit is a bad thing. Do you have any verifiable evidence to support your view that it is?

        Re the carbon tax, do you have any verifiable evidence that it has caused any economic problems?

        As for zero debt, it doesn’t really do us much good if you cut all investment in infrastructure and sell off all our assets to attain it. And btw, a household budget is a very different beast from a national budget. There are schools of economic thought that advocate for always running at a deficit.

        It’s disingenuous to suggest that Labor’s deficit was harmful. They were in government during the GFC, and they invested in our economy and our future. That’s what caused the deficit.

        Yes, we have vast quantities of natural resources, but what happens when we run out of coal in 43-90 years? How will we power our country? Abbott is actively undercutting science, research and education.

        As for mining being the backbone of our economy, that’s not true either. Yes, it’s a big part of our GDP, but by no means the majority ( http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1301.0~2012~Main%20Features~Value%20of%20goods%20and%20services%20produced%20by%20Australian%20Industry~240).

        Note that according to Wikipedia, the mining industry’s contribution to our GDP has increased to 10% since that graph was published, but I couldn’t find a graph to show it.

        However, it’s important to remember that 83% of our mining industry is foreign owned. So even though its earnings still contribute to our GDP, they don’t contribute to our wealth (Gross National Income). In terms of our wealth, by my calculations, mining contributes about 1.7% to our national wealth.

        Outside of the direct contribution, the mining-related economy contributes another 9% to our GDP. I’m not sure how much of that economy is foreign owned.

        Re the ABC, the data doesn’t support your assertion that it’s ‘left’ propaganda. http://www.theguardian.com/media/datablog/2014/feb/06/australian-broadcasting-corporation-australia

        Super cuts (not just politicians’ super), I agree with. Tax concessions on super total nearly our entire pension budget, and they’re growing. What’s more, they favour the rich far more than the poor. http://www.macrobusiness.com.au/2014/04/joe-outlines-budget-pain-for-all-except-the-entitled-rich/

        • Pete says

          Whilst a lot of the data suggests there’s nothing wrong, the concerning data surrounds debt. Debt is no trending upwards. The IMF have stated it’s concerns about long term significant increases in the costs of social programs

          Long run spending projections are discussed in the latest 2010 Intergenerational Report (published every 5 years by the Treasury). “Around 40 percent of government spending is directed to health, age-related pensions and aged care, disability, and education (here referred to as “social spending”). Spending on these areas is projected to increase significantly over the Report’s 40-year horizon. Rising health costs account for around two-thirds of the overall increase. Some policy and legal changes—in education and the second round of private health insurance in particular—have been made since the Report was published which affect the composition of spending pressures, although the outlook remains broadly the same.”

          You mention poverty. This a direct function on the cost of living. This is something that both Liberal and Labour have failed to keep a reign on. Rent being the major contributor and those pensioners that don’t own a home will be hurting. Reports today say that 96% of properties in the rental market are beyond the reach of the lowest paid.

          Keating, in his 4 part series on the ABC, mentioned that Rudd’s decision to throw cash at the GFC was a poor decision. Australia’s economy, due to the resource sector, was still quite hot. What did Rudd do? Got a drum of petrol and poured it on the fire.

          Economies go in cycle, just like the seasons. When you interfere with that cycle, the reset button is never pressed. Recall back in the early 90’s and “The Recession we had to have”. I thought Keating was a loon at the time. 17% interest rates. But when you think about it. It reset the economy and then the economy went on a 15 year winning streak!

          You raise some good points, but your data doesn’t indicate the why? A number of your graphs are up until 2011. This was when the tailing of GFC policies. The past 3 years where the debt has begun to rise significantly and when high revenue social policies, such as The NDIS have been budgeted for.

          Welfare as % of GDP is an awkward graph. The higher the spending generally means the higher unemployment. Many European countries are in excess of 10%. Spain is 26% and youth unemployment in Spain is over 57%. So I would hate our % of GDP on welfare to accelerate

          Lastly, comparing dent to OECD is also an awkward comparison as a number of EEC states have been bailed out. In some countries, bailed out more than once. Some of those, multiple times. In the words of Sir Alex Fergusson. I don’t care what the opposition are doing or hunk of us. I just focus on my team and do the best for my team. Worked for him for quite a long time.

          Another stat that you have missed, which is very important to social programs is the birth and death rate. The expected icing age is two years more in 2012 than in 2002, yet our retirement age hasn’t moved in quite a while. This puts upwards pressure on pensions

          Although, older population may be offset by the increasing population rate via births and deaths. Something like a nett 40k increase in 2012 than over 2002

          One criticism of the Howard era was the lack of infrastructure investment with the large surpluses they were generating. A high Speed Rail link Brisbane, Sydney, Canberra & Melbourne would have future proofed that transport corridor

          • says

            Hi Pete. Thanks heaps for your comment. No dramas re the spelling mistakes. I’m sure I’ve made a few throughout meeself!

            That said, my first point relates to a point with a typo. You said “Debt is no trending upwards”. I assume you meant “now” and not “not”? If so, yes, I’ve mentioned this under my debt graphs. It’s now up at around 11.7%, I believe. So that puts the line slightly above the 10% horiz, rather than slightly below. Not really a dramatic shift, and we’ve certainly been a lot higher (e.g. 1993 – 1999). And certainly nothing that would constitute a crisis.

            There’s absolutely no question, if we have an aging population, we’ll have to continue to spend proportionally more on them. That’s just a reality we have to face. And it seems to be a reality that a few people here (and the gov) don’t want to face. There are only so many cuts you can make to welfare before you start making things worse for the economy, not better. Given the relative poverty of our pensioners already, I’d suggest we’ve already reached that point.

            And even if you don’t agree with that, there’s no denying that science, research, education and health are critical to our future. Slashing them now simply undercuts our future. Just another example of the short-sighted politics that seems to be all we get out of our current system of governance (but more out of Liberal than Labor).

            Re the graphs, yes, I know a few are a couple of years old, and one is from 2009, but I’ve used the most recent available. I know this makes it more difficult to be precise, but it still paints a pretty clear picture. I’ve updated the debt graphs so they now show up to 2010, too. Not as pretty, but at least they show a year more. :-)

      • Greg Battye says

        GT, I guess you simply didn’t read any of the data. That’s always the problem with people who vote for governments such as Abbott’s: they don’t take any notice of actual information, only of streams of assertions. Your comments are welcome, though, because they provide a stark reason for the existence of sites such as this one, which actually investigate the right’s rhetoric in a plain, unadorned and objective fashion.

        More strength to your arm, Glenn — keep it coming. GB.

    • Mike says

      This means all you gotta do is volunteer for your local non-conservative party.

      Job done and problem solved. Encourage your friends to do the same, it’s a democracy after all.

  3. Carl says

    These neocon fascist have had an agenda all along, to “restructure” as many of the advanced economies around the world in order to bring about greater corporate and financial control of the socioeconomic situation on the planet. Just have a look at how the “problems” in the EU were handled and will be handled in the near to medium term. Look at the train wreck in the US and the way their economy has been run for decades. The Bank for International Settlement, the World Bank, IMF and various other private financial institutions, as well as many of the megacorporations have been planning on manipulating the social, economic and political structures of the nations of this planet, for many years. The simple fact that they’re looking towards creating a new reserve currency and want to devalue many of the strong currencies around the world is just a few of the pointers. The TPP is another pointer, but compared to what they want to attain eventually, it’s tantamount to a Sunday picnic in the park. 1984 would seem like a democratic utopia compared to where these people want to take us. They tried this in the US as far back as 1933. They failed then because the one person they needed to back them with the support of the military exposed their little putsch. They learnt from that. Now, instead of trying it in one country alone, this little charade has gone worldwide in a big way.

    Now, we have the same sociopaths trying the same thing in our own country. You have a government that is so far right of the centre that you’d need the Hubble to even see them and an opposition that has no backbone at all and who hasn’t been anything but a right of centre party for at least 30 years or maybe more. More to the point, you have a government that is basically made up of sociopathic personalities of various degrees, most of them considerably sociopathic, who are led by a gormless and pathetic excuse for an individual whose level of sociopathy is only topped by his uniquely twisted form of god complex. Though the both of these pathologies go hand in hand. The only one who might top him is for all intents and purposes clinically insane, or would be if he were to be examined by any competent clinical psychologist. But, luckily enough his leader had enough sense not to give him any position of importance within his government. Though, he still tolerates his presence in the government and probably supports him privately (for all we know). One of his own party icons even described him as the most dangerous PM we have had, or have had for a very long time. You wouldn’t call that a ringing endorsement, despite that person’s own duplicity and less than stellar integrity. Mind you, what politician actually has anything of a reputation that’s better.

    In the final analysis, we have allowed ourselves to be conned to the point where we have voted for a government that has no intention whatsoever of doing anything of conscience and/or benefit for this nation. Only for themselves and their corporate masters and they don’t give a tinker’s cuss what we think or believe.

    • Andrew says

      Right on Carl! These cretins are going through the facist handbook and ticking off every item they can conceivably get away with. We let them do it because we’ve had it too good for too long and forget that a democracy is a privillage NOT a given right and to keep it takes maintenance! Instead we dismiss politics as boring and turn to the sport, not realising that this is exactly what these A_holes want because disengaged appatheic voters are easy to manipulate. It doesn’t help that we have a mainstream media dominated by right wing capitalists with little competition who are nothing more than a PR arm for the Liberal Party.
      You mentioned that the ALP have been right of centre for years and I totally agree. People label the ABC as left wing biased but that only because everyone’s forgotten what the centre looks like! Anything left of Andrew Bolt is considered left wing so what hope have we got? The only true leftist party with any moral values or principles are the Greens but our beloved media led by Lord Rupert himself have successfully programed people to instantly dismiss them as fringe dwelling jokes and give them bugger all air time. This type of brainwashing stops people from thinking for themselves and ensures that power stays firmly in the hands of the wealthy corporate few as opposed to the people.

      • rick says

        You’re so right, Andrew. Couldn’t agree more with everything you’ve said here. Sadly, so many people – many of whom had no clue what they were actually voting for – took notice of the right wing media led by Rupert Murdoch (Tony Abbott’s main supporter) and the shrieking Alan Jones types.

      • sam says

        Don’t forget the socialist alliance. radical to some but mostly common sense patriotic ideas. For the people of this country , not it’s overseas financier/profiteers!

      • GT says

        The Greens are just loony commies, we saw how destructive it was having them influence the last government. If they ever got into power in their own right, everyone would have a bike, but no one would have a job. Thank God Abbott has already ended Labor/Greens open border approach and stopped the boats, saving Australia billions of dollars.

        • says

          Thanks for your comment, GT. I suggest you actually take the time to read their policies. What you’re saying is completely false.

          • Nic says

            you cant argue with an idiot glenn, they will just bring you down to their level and beat you with experience.

            also i love this study you have done it is fantastic although it make me sick to my stomach with fear of what further damage will be done in the remainder of abbots term.

      • Jon says

        Ditto in NZ except we’ve had to put up with five years of it. The media much the same right of right and the polls suggest no alternative to the Nats. There is a growing concern with the TPPA, except our National government can’t expose their lower checks fast enough to the US.

        Asset sales, tax cuts for the wealthy and to compensate increasing GST, that punishes the less well off.

        This neo liberal nonsense has to stop !

    • Dazza says

      I’ll have to agree that the ALP did move right-of-centre with Keating at the financial helm, and have remained there since, but nowhere near as far right as the extremists we have in power now.

      However, the ALP have generally remained left-of-centre on social policy.
      Perhaps this is not what we truly want of a ‘workers party’, but it is still far, far better than what is offered by the current ratbags.

      While it feels like Shorten is in hiding at times, to me it feels like he is trying to build a groundswell of support for party reform. Unfortunately, while that reform is needed, in the mean time Abbott and co is running roughshod over our future and no one is holding them to account. It is time for the ALP to come out of this introspective period and fight this injustice. Surely party reform can be undertaken simultaneously.

      • Andrew says

        Yes you’re right, we hardly hear boo from Shorten. Surely he can multi-task because we need someone to hold Abbott and Co to account. It’s nice to see Clive Palmer giving the Libs a headache at least although I know he’s far from genuine and most of the stuff he says is only what he knows people want to hear, not what he actually believes.

      • Ruth says

        The trouble with Shorten is that he followed Abbott as Leader of the Opposition. Abbott spent most of his time in opposition making loud and negative pronouncements about the Government – all of which were pounced on and trumpeted loudly by Murdoch’s MSM, who built on the negativity and the ALP’s internal instability with their endless opinion polls.

        It wouldn’t matter who the current LotO is, they’re going to be judge on their ‘silence’ simply because they are not in the news every other day condemning every word the Government says and constantly reminding the public of every broken promise. Any attempt to be positive and not copy Abbott’s relentlessly combative style is portrayed by the MSM as being weak or uncaring – a viewpoint quickly believed and echoed by the wider community.

        • Ralph says

          Pretty sure if you could search every political office in the country, you’d find a handful of spines… but those you do find, wouldn’t stand up in a strong breeze. Party politics are riding roughshod over morals, values, beliefs and common sense. The Australian Media panders to these political animals like the whore she is, thanks to Murdock and his ilk.
          Perhaps at the next election, if we all voted informal, we would send a clearer message to every politician in this country. The Governance of Australia never, ever takes a backseat to Party Politics. Every member has the RIGHT to vote with their conscience, without fear of Party reprisal.
          Many times I’ve fought for wage rises, and they usually come with enterprise bargained agreements. Targets and quotas have to be met for pay rises to proceed. If these pollies had the same deal they wouldn’t have had a payrise in 20 years.
          We often elect good people, however the current political arena is designed to corrupt, belittle and cower. When i was a lad, you’d get a good flogging for lying, Abbotts lucky his old man ain’t around after the flagship of lies he told to get elected.

    • John O Pinion says

      Every politition is a sociopath, regardless of party. It’s in the job description

      • Jason Rossiter says

        Being a (highly functioning) sociopath isn’t necessarily a bad thing. We can be quite helpful if it helps us. Now a tyrannical political sociopath is a bad thing when they aren’t held accountable for their actions by a board or council of varying mindset and goals. Sorry to jump on your comment but I wouldn’t want everyone to think sociopathy is a bad thing and especially to be grouped in together with politicians with such an agenda.
        Sincerely Me

    • says

      Sell out Tony Abbott is a fascist puppet of Murdoch, Lowy and the International Zionist banksters who own our Central Bank, the RBA – It’s all about debt, austerity, enslavement and making Australia ripe to join their one world govt NWO
      Before this happens. maybe before this years end, we will be sucked into WW3 by US puppetboy Abbott against Russia, China, the other BRICS Nations, N Korea, Cuba, Venezuela … on the side of evil and we can expect only one outcome, an eventual toxic nuclear wasteland of a planet

      • brett cunningham says

        Right On Brian, It;s so good to see that there are people AWAKE to the New World Order & Agenda 21 It’s being done to all western nations look at Spain, Greece, Portugal, Ireland, & many European countrys. Their main objective is to Deindustrialize the western nations send all the jobs to China & other third world nations, Carbon taxes are crippling us & forcing companies to go over seas because of the HIGH electricity & Gas costs!!! These stinking PUPPET pollies that the dumbed down voters vote in & out every 3 years are Bought & Paid for by the same Multi National Corparations & Elite Banksters made up of just 12-13 Familys the Builderberg Group, they are insane Psychopaths who want to control every resourse & human activity on the planet, that’s after they have wiped out at least 90% of us with prob a Bio weapon release our poisoned food, water, & vaccines, arn’t killing us off quick enough these Scumbags will go to their Deep Underground Millitary Bases they have been building since the late 40s & emerge from their hell pits & merge with Machines & thoese that are left will be controlled Surfs to help run the new world ORDER!!!! Time is running out for Free humanity the time to act is now or suffer your fate!!!! God help us ALL.

  4. says

    The brief answer is ideology. These pin-heads really do believe in ‘the invisible guiding hand of the market’ and the trickle down effect. They believe that the government’s only obligation is that Rand-ite bullshit about the ‘provider’s of wealth’ and that the responsibility government has is to protect its citizens from fraud or force -everything else is up for grabs and the devil takes the hindmost – back to the 19th century and the Robber Barons
    Some of my own thoughts on the subject;

    http://mugwumpost.wordpress.com/wood-duck-watch-1the-joy-of-surplus-let-us-now-bask-in-the-warmth-of-our-own-bullshit/

    • Andrew says

      Spot on! If more people had even a basic understanding of political ideology and the primary role it plays in the formulation of policy and the decision making of governments and political parties then perhaps they wouldn’t have the wool pulled over their eyes so easily and so often. People always babble on about TRUST when it comes to politicians but they don’t seem to realise that if you understand ideology and the fundamental differences between the parties then you don’t have to rely on trust at all, you KNOW exactly what each of the players are going to do despite what they may say!

      • Billy the Kidder says

        I agree, people should understand ideology.

        It would mean the end of the Greens and perpetual ALP opposition. Of course, if the ALP actually represented the workers the outcome might be different. I used to believe the ALP represented the little person but they haven’t for at least 40 years now.

        The Fascist Left are unelectable and the ALP sits a little too close to their totalitarian brothers to be different.

    • Dazza says

      Sadly true.
      The ‘market’ is good at sorting weak from strong, but has no social conscience or humanity.
      The ‘trickle-down effect’ has had more than 30 years now to prove itself, and yet NOTHING has trickled down, or even dripped. It has all stayed up at the top, which is where it was supposed to stay. How can we believe otherwise?

  5. Allen Agnew says

    I didn’t vote for the Liberal’s. Most blind Freddy’s should have been able to souse them out before the 2013 election. I am very frustrated that many of us Australians can’t see the down to earth reality of some parliamentarian’s promises and souse out which ones are genuine and which ones are not. For everyone who voted for Abbott and those of us who didn’t,we’ll all just have to suffer the consequences which are only just beginning to come forth.

  6. European says

    As a European citizen it’s really hard to believe some of the numbers showed above, like those, for example, which state Eastern European countries have a lower rate of poverty than Western ones.
    That is simply not true.

    The above charts and numbers have to be examined in the context of the single economy / country. Stating that Australia spends much less on welfare than many European countries might be true but it’s also true that benefits for Australian citizens, together with ” free services ” , are way fewer.

    European retirement system ( at least the one applied in many western countries ) is completely different to the Australian one and people have much higher pensions

    So, while I am a fan of comparison charts, I am also aware that they have to be carefully contextualized. Australia can certainly be one of the strongest economies in the world but this statement is very much faked by the figurative dominant role of the mining industry which, in real life, employs no more than 1.6 – 2% of Australian workers.

    Australian economy is also very unbalanced towards the ” service sector ” while heavily lacking in the manufacture one.

    As wikipedia states :

    ” The Australian economy is dominated by its service sector, comprising 68% of GDP. The mining sector represents 10% of GDP; the “mining-related economy” represents 9% of GDP – the total mining sector is 19% of GDP.[28] Economic growth is largely dependent on the mining sector and agricultural sector with the products to be exported mainly to the East Asian market ”

    ” Much of the economic growth in Australia is attributed to areas of the country where mining- and resource-based industries and services are mostly located. Western Australia and the Northern Territory are the only states that have economic growth.[2][57][58] During 2012 and 2013 Australian Capital Territory, Queensland, Tasmania, South Australia, New South Wales and Victoria have had recessions.[2][59][60][61][62][63][64] The Australian economy is characterised as a “two-speed economy”.[65][66][67][68][69][70][71] From June 2012 to March 2013 Victoria has had a recession. In 2012 the Victorian state government cut 10% of all jobs in the public service. ”

    Another thing worth considering is GDP : one thing is the GDP of a country while a completely different thing is the GDP pro capite. You might be surprised to see how different they are. Australian real economy is much weaker than what it seems ( unfortunately )and Australians should fear the day when China will turn greener and stop importing Aussie coal.

    There would be much to say about Chinese economy as well and about the way they fooled the world. But that’s another story.

    In spite of what I stated above, I think Australia has very much potential to become even better than what it is already and I completely agree with those who say that the actual government is going down the wrong path; the same one that lead US and Europe where they are now.
    Keep in mind that all the financial crisis are well planned and manufactured and the very next victim is going to be Australia, unless people decide to stand still for their rights and freedom.

    Best of luck.

    • says

      Hi European. Thanks so much for taking the time to make such a thought-out comment.

      Re the poverty rates of Eastern vs Western European pensioners, the graph is based on how many pensioners are earning less than 50% of median equivalised income. I don’t know if that’s a good measure of poverty, but that’s how the OECD has measured it here. (Here’s the full report btw: http://www.oecd-ilibrary.org/docserver/download/8113221e.pdf?expires=1398591485&id=id&accname=guest&checksum=ED653ACEC62811A3AD167C2C120B0D1E

      Obviously if pensioners in one country have access to more non-pension welfare than those in another, then that’s going to confound the results a little. So I had a look around at some figures that might shed some light on this for us (specific to Australia)…

      Firstly, I found that Australia’s health spending as a share of GDP is lower than the OECD average, but slightly better than average per capita: http://www.oecd.org/els/health-systems/Briefing-Note-AUSTRALIA-2013.pdf

      Secondly, I found that our government final consumption expenditure (investment in goods and services for current use to directly satisfy individual or collective needs of the members of the community) is about average: http://www.oecd-ilibrary.org/sites/na_glance-2013-en/03/02/g11-1.p1.html?contentType=&itemId=%2Fcontent%2Fchapter%2Fna_glance-2013-13-en&mimeType=text%2Fhtml&containerItemId=%2Fcontent%2Fserial%2F22200444&accessItemIds=%2Fcontent%2Fbook%2Fna_glance-2013-en

      Thirdly, I found that our general gov spending is slightly lower than the OECD average: http://www.oecd-ilibrary.org/sites/gov_glance-2011-en/03/04/giii-4-02.html?itemId=/content/chapter/gov_glance-2011-10-en

      So overall, that would suggest things aren’t *quite* as dire for Australian pensioners as the poverty graph suggests. But given that these other figures are all about average, I think it’d be a safe bet that our pensioner poverty is still on the bad side of average.

      Re mining, I’m not really sure what you’re saying there? I *think* you’re saying our economy might not always look so good because of our heavy reliance on mining? If so, I’d agree. But that’s by no means an inevitable outcome. It’s only inevitable if we choose to make it so. (I wrote a bit about that here: http://www.glennmurray.com.au/why-is-abbott-is-undercutting-the-renewables-industry/)

      Re GDP per capita, we actually rank 10th, 11th or 12th in the world (depending on which rankings you look at: http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita). BUT out of OECD countries, according to these same lists, we rank 6, 7 & 6, respectively. (I stripped out the non-OECD countries.) In other words, we rank VERY well, on GDP per capita… :-)

      • patrick says

        Glenn can you also take into account inflation figures for housing prices, rent , electricity , gas , fees for services like registration, council rates, insurance, FOOD etc … my point being its fine to have graphs showing income and spending and %’s of GDP but unless you give it context by comparing it to the cost of living then it’s useless information. The average wage in one country may have vastly different spending power than that of another country. In real terms

        Australia is trouble on many fronts
        1) Unfunded liabilities …add 150 billion ( at least)
        2) Due to weak exports ( leave for mining) the domestic economy relies on domestic demand , now with prices rising for life’s essentials disposable incomes are dropping , domestic demand drops, tax revenue shrinks, jobs go , companies ship out …. fruits of neoliberal slavery bloom.
        3)Mining and inflationary bubbles distort the true GDP, the previous author was right in stating that Australia has a clear 2 speed economy with limited benefit to the rest of the population .( Norway taxed mining and now has a 1 trillion future fund )

        I could rant all night about this but I’ll leave it there .I hope you find that half useful .We’ve got to stop with this ” c’mon guys it’s not all that bad ” routine because it is bad , and until we switch our policy fundamentals and take back our infrastrusture and dispel the ridiculous idea of privatization we will be in decline. Name one instance of privatization that has benefitted the general public where we either get a better service or better price?

        • says

          Hi Patrick. Thanks for your comment, and sorry for my delay. Been very busy and heaps of comments here.

          I think my answer to the first part of your comment (about spending power) is that the measure of poverty is relative. The OECD explains it best:

          “Perceptions of a decent standard of living vary across
          countries and over time. Thus no commonly agreed
          measure of poverty exists across OECD countries. As
          with income inequality, the starting point for poverty
          measurement is equivalised household disposable
          income provided by national consultants…
          People are classified as poor when their
          equivalised household income is less than half of the
          median prevailing in each country. The use of a relative
          income-threshold means that richer countries have
          the higher poverty thresholds. Higher poverty thresholds
          in richer countries capture the notion that
          avoiding poverty means an ability to access to the
          goods and services that are regarded as customary or
          the norm in any given county. The poverty rate is a
          headcount of how many people fall below the poverty
          line.”

          In other words, I think it’s a fair assumption that someone below the 50% line in one country will have about as much trouble affording necessary goods and services as someone below the line in any other country.

          Re unfunded liabilities (i.e. future debt), I agree, this is troubling. But it’s not what we’re discussing here. Importantly, I think these liabilities are troubling, not because of their absolute value, but because our government is actively undercutting our future ability to service that future debt. Cuts to science, research and education investment for short-term balance sheet (political) gain are what will really turn our unfunded liabilities into a problem.

          I agree, wholeheartedly, re the weakening overseas demand for our mining exports. One more reason cutting investments that would lead to a complex economy (and not just cows and dirt) is a big problem. (More on economic complexity here: http://apo.org.au/commentary/want-industry-policy-our-living-standards-are-set-fall)

          Re your comment about distorting the true GDP, I have 3 responses.

          1) Most importantly, you’re right that we have some distortion as a result of the mining industry. It’s 83% foreign-owned, but it’s still counted as part of the GDP, even though the lion’s share of the profit goes directly offshore. A better measure would be Gross National Income (GNI). According to the World Bank, our GNI per capita is above OECD average: http://data.worldbank.org/indicator/NY.GNP.PCAP.CD/countries/AU–XS?display=graph. In other words, we’re still doing alright, even considering the foreign ownership.

          2) I disagree about the boom itself being a distortion. It’s a reality. Obviously it’s a short-term reality, but it is what it is. We just need to plan ahead by investing in future, more complex industries (which obviously we’re not doing).

          3) I also don’t agree that the mining boom has offered limited benefit to the rest of the population. Mining has created quite a few direct and indirect jobs, and, for the most part, those jobs have paid well (or at least not less than they should). The benefits of this flow on to everyone, to some extent. BUT there is a very important qualification to this statement: Queen Gina’s recent calls for lower wages for Australians, and her use of underpaid foreign temp workers are very scary. If these things became the norm, the remainder of the mining lifespan could deliver almost nothing to Australia as a whole.

          And naturally I agree we should be taxing mining companies far more than other companies, not giving them tax breaks! And I agree we need to control as much of our infrastructure as possible. But I still think it’s fair to say that we do not have a debt crisis on our hands, and that, economically speaking, we’re in good shape.

          The real danger isn’t debt, it’s the opposite. Undermining our future by refusing to invest in alternatives to the mining industry (and in alternatives to coal power).

          • Optamizm says

            I really don’t understand why we let foreigners own most of our mining… Shouldn’t the people own it? Not the companies, but the resources… Shouldn’t the people of Australia recieve payments for the minerals they mine? Why are they getting tax breaks? I honestly don’t know much about it, but it seems like someone’s ripping us off…

    • Unemployed & it's Abbott's fault says

      I wouldn’t take Wikipedia as a viable source any yahoo can make those things up. we aren’t allowed to use them as resources in higher education, so why should you use them now? Brain washing is what The liberal party do and with Murdoch on their side and The mining industry filling their coffers until budget time.

      • Oz says

        If you were to go to the actual sources you’d find that what was said was legitimate. Wikipedia is much more reliable than a lot of people in ‘higher’ education believe.

        It’s not like they can just go and say whatever it is a compendium of information that is monitored by others and to claim something does often require a source if there is a point of contention.

  7. Graham says

    Why does the Net Debt Graph only show figures at 2009 ?
    Wouldn’t the several hundred billion increase since then spent by Julia and Kevin change that Statistic considerably ?

    • says

      Thanks for your comment, Graham. Sorry, I couldn’t find a more recent graph. I did some digging and you’re right, it has increased since 2009, but so too has the OECD average – and a lot more. Ours has increased from about 9% to 11.7% (as at Aug last 2013 – http://www.theage.com.au/comment/debt-crisis-truth-is-there-isnt-one-20130816-2s289.html). The OECD average has increased from 52% to around 70% in the same period (http://www.oecd.org/eco/50543310.pdf – sorry, this was the best reference I could find. My wife is waiting for me to watch a show!). According to Wikipedia’s summary of IMF figures, we’re ranked 11 out of 34 OECD countries (http://en.wikipedia.org/wiki/List_of_countries_by_public_debt – I sorted the list by debt then manually stripped out the non-OEDC countries).

      So, to summarise, our net debt has increased over the last few years, but far slower than the OECD average, so we’re even further below the OECD average than we were in 2009. And only 10 OECD countries are doing better than us, net debt-wise.

  8. Cara says

    Bottom line is politicians would rather starve a child than part with a cent from their own pocket. It’s ridiculous that persons who have no experience in poverty decide what’s best for those who spend hours in line for community food banks.

    Politicians should be subject to the same rules the rest of working Australia is. If we get fired we don’t get a pension! When voted out they should have to rock up to Centrelink (income and assets tested of course). Their pay raises should be based on performance, available funding and certainly not decided on by them!

  9. Ray Walters says

    Although I agree 100% with everything that has been said here, I don’t see any way to overcome the problem unless we can somehow force them to resign. So how can we do that? We need a double dissolution and we need it now! The only way we are going to get that I think; is for the senate to hold it’s nerve and block the upcoming budget. We all need to write/email, phone, do whatever is needed to contact our own representative in the senate and insist that on our behalf and for the sake of our country, that they need to stand up to Abbott/Hocky & co. and block the budget and keep blocking it until we get what we want.Sitting around on Facebook and various bloggs and whinging to each other will achieve nothing!

    • says

      I doubt we’ll get a DD. Nonetheless, letters to MPs and Senators is definitely a good idea. I’ve been doing a fair bit of that. I still think blogging about it is important, though. Raising awareness… A lot of people are fooled by the ‘debt crisis’ propaganda, because they think economics is too hard for them to understand.

    • says

      Hi Ray, yes I too agree with all that has been said, but, I live in a small rural area (approx 3,000) & prior to the last elections, I, & voters that I spoke to heard diddly squat from anyone representing any party. Generally the mail box overflows with paper promises from the different parties, so apart from the crap that they tried to brainwash us with in the media we obviously had a ” lack ?” of interest from our local members

  10. Rob Colligan says

    The Liberal National Party have become the party that promotes the politics of fear. First introduced with great success by John Howard with the Tampa Crisis and the Children Overboard debacles…

    • Moi says

      So what was with all the scare language associated with the Building Education Revolution? “Our kids are being left behind”? “We need a revolution so our kids aren’t left behind blah blah”? We needed new 1 million dollar canteens and school halls and teaching assistants are now being fired because they spent too much on the buildings? The buildings were overpriced and the program was mismanaged allowing union builders to rort. All we got was a new curriculum based on the NSW curriculum and a hefty bill for them pretending to make a new one.

      The Greens, “Oh don’t vote for the liberals, they are allowing dredging of the barrier reef”…except they forgot to mention their representative and Julia Gillard featuring in a pro reef dredging video 3yrs beforehand saying it would be good for jobs. Hypocrites. I think you’ll find “politics of fear can be found on all sides”.

  11. Kathryn says

    Look at his face, his demeanor and his personal history. He’s cruel and mad, and loves to punish people he considers weaker than himself. Suddenly, the number of people he can hurt and punish has dramatically enlarged. Look out Australians, look out world. Maybe he loves the idea of Armageddon and Christian rapture? Maybe he belongs to the same international power-crazy club as Obama?

  12. Arabella says

    Glen

    Thank you, great article, timely and necessary as the facts seem to be getting in the way of a good government.

    The scare tactics cloak poor short shighted thinking, and amplify juvenile reactions to serious national issues. We have a current opportunity to continue to mature the development of the country at a time where we could grow, prosper and evolve steadily and instead we have leadership that is attempting to retard growth and regress our economic, social and human development.

  13. Reinhard says

    Almost all those statistics are wrong. I checked. Also consider that in a world of failing economies – average means failing.

    • Sceptic says

      The media purports to be balanced. Send this to all the papers and networks, they love graphics, and this way they can have more than a 15sec soundbite or 5 word print heading. Ditch the bit about music though, it’s totally fiscally irrelevant.

      • says

        Hi Sceptic. Thanks for your suggestion. I’ll give it some thought. Re the music industry, I disagree. Musicians, as a group, tend to struggle. Cutting investment in the industry will increase poverty among musicians and undermine the industry. It may be only a relatively small impact on our economy, but it’s still relevant.

    • Seems Legit says

      Sooo…..if “average means *failing*” ….and Australia is ranking at below average in most aspects, would that mean were * SERIOUSLY FAILING* as a country on a world platform and that the Australian Government is *SERIOUSLY FAILING* its people?

    • Code says

      Hi Gina, I wondered how long it would take for you to stick your bib in. Please go back to giving Abbott orders, the rest of us have no interest in what you have to say.

  14. says

    It all goes back to the sixties when wage increases changed from monetary to percentages. Those with higher wages just soared year by year over those with lower wages in the percentage system.

  15. Joe says

    When the rest of the world is looking up economically, we are going down!

    We will probably go in to recession for the first time in over 25 years thanks to this bunch of cretins!

    You simply can’t cut $300b out of an economy and expect it to grow!

    This obsession with a budget surplus is a nonsense for a young country like ours! Apart from one year, early last century, Australia first balanced budget was in the Hawke Keating government.

    With any luck they won’t have enough time to wreck the economy totally.

    • Ruth says

      True. Even the Lib’s much loved and revered *Sir* Robert Menzies couldn’t land a surplus in 18 years as PM. This failure didn’t dismay Menzies in the slightest – he always claimed his greatest achievement in office was holding the Coalition together, an achievement the Liberals have had to rely on since the 1940s.

  16. Boris says

    Getting sick of all you hippies acting like Abbott is out to get you. Get off your arse and do something and stop waiting for a Kevin Rudd style hand out. Abbott is doing a great job.

    • says

      Hi Boris. Thanks for your comment. I think you may have misunderstood the article though. On a few counts:

      1) Pensioners have spent their whole lives getting off their arses and doing something. Now they’re being singled out when they already suffer more poverty than in any other country except Korea.

      2) People who can’t work or can’t find jobs need to be supported. Not just with cash benefits, but in other areas of life too. Without this support, poverty increases, which leads to increased crime and social unrest, increased health costs, and a perpetuation of the poverty cycle. Obviously none of this is good for our society as a whole, or our economy.

      3) Drug addiction affects our entire society, not just addicts. It increases crime rates, the load on our public health system, the load on our justice system, and the long term load on our welfare system.

      4) When a government cuts spending, what usually happens is unemployment increases, and the government then has to spend more on welfare. (And when the spending that was cut is in welfare, we end up in a vicious cycle.) Private industry usually slows too, which slows our economic development.

      5) Cuts to our public hospitals affect everyone who needs to go to hospital, thereby reducing the quality of healthcare, nationwide.

      6) Cuts to education, science and research undermine our ability to compete with other nations and to develop a more complex economy. (A complex economy is essential to any country that can’t rely on fossil fuels and manufacturing. We’re running out of fossil fuels, and our labor costs are too high to compete in many/most manufacturing industries.)

      If you disagree and have verifiable evidence to support your position, I’d be happy to discuss.

      • abbienoiraude says

        Wow you are great, Glenn, at answering this kind of retort. Thank you for the measured and reasonable argument. Wish there were more of you and less of the other fella.

        • Mely says

          Admiring your answer, patience and commitment to educate…and still managing to squeeze watching a show with your wife. Hats off people!

      • says

        Thanks Glenn for answering Borís. I know we all have a right to our own opinion. I also want to know how Palmer got so many votes?? Also for Boris’ information I am off my a@@e. I worked 3 jobs, 2 to keep a roof over my head & my children & 1 job paid the tax on the other 2. I am 70yrs of age & I worked for 40yrs, until retiring 10years ago. I work in a voluntary capacity 3 days a week, so I really don’t have the pleasure to sit too long on my arse. Sunny

        • says

          Thanks Abbie, Mely and Sunny. I appreciate your support. The way I see it, most people who disagree (especially in the way Boris did) are doing so out of ignorance and fear. They’re victims of propaganda and misinformation. If I respond in a way that’s confrontational, I’d simply be perpetuating the manufactured left-right divide that stops us from talking about the real issues like adults.

          Sunny, I’m not 100% sure how PUP got so many votes. I think his opposition to the Libs earned him a few, and he no doubt got some protest votes too. And of course he’d be getting some votes from the people who believe passionately in trickle-down economics. But I’m sure there’s a lot more to it, and I’m no expert. :-\

      • May says

        Beautiful reply, Glenn. The Borises of Australia find it too difficult (or too frightening) to look any more closely at the situation than that all our problems are due to the ‘laziness’ of poor people & the ‘wasteful’ spending of any government that isn’t viciously cutting or ceasing funding to everything that makes for a decent society.

  17. em says

    the real question is what we the people can do about it? really… Most people lookk and then get on with their day because they feel there is no way of influencing these decisions. I didnt vote for abbott or for the labour party, as far as I am concerned they are two sides of the same coin. Unless we know the REAL motivations for liberal decision making we cant really do much right? If you know the answer I am all ears.

    • says

      Hi Em. Thanks for your comment. You’ve hit the nail on the head. What to do? It’s certainly tricky. I agree there’s very little difference between Liberal and Labor, but there *is* a difference. Labor tends to invest more in public infrastructure and welfare. They have a longer term approach to economics. They’re also less focused on pandering to the rich and the corporations. Slightly.

      That said, I don’t believe either party is the answer. In fact, I don’t think ANY party is the answer, so long as our system remains fundamentally flawed. I believe we need a direct democracy component in our system, much like the Swiss have. I’m working with some people on this front that have a serious chance of seeing this happen. Stay tuned for more news… 😉

      In the meantime, staying informed is critical, as is lobbying government wherever possible. That’s why movements like March in March are so important.

      • em says

        yes thank you! the swiss model i would definately like to hear alot more about.
        The problems in any government are systemic to most governments worldwide. SYSTEMIC. Meaning as they stand they cannot be fixed. Although i agree with you about the labour party and theri general aproach to economics and how they choose to stimulate economic growth. Once upon a time the libral approach of fiscal policies made more sense but when they do this to our social fabric and then SPEND BIG on new defense bombers , I am thinking about the why which we are not told about, the underlying agendas . Im not trying to sound all”conspiracy theory” on you though, but neither labour or liberal economic policies in general work as a whole but i would rather support a labour government given no alternative as it is more socially viable.

        • says

          We need some checks and balances from the people. The Senate clearly isn’t doing a good job, plus the Senate can operate only within the framework of existing policy (and they’re too removed from the realities of the average person).

          The direct democracy component of the Swiss system, on the other hand, allows the people to not only contest new laws via referendum, but also to suggest new policy via referendum. This means the framework of debate is greatly expanded.

      • Mely says

        Good to hear about people being clear that no party is the answer and another model, like the Swiss, is under discussion. Keeping and ear out for this one!

  18. Richard says

    History is fine and good… but what about some forward projections on expenditure and income for the next 20yrs?

    Ballooning health care costs, increased % of population over 65 etc etc.

    • says

      Hi Richard. Thanks for your comment. There’s no denying we have an aging population, but there’s no justification for conflating that with a manufactured ‘debt crisis’. It’s just something we have to deal with. And the first thing we should be doing is *increasing* investment in health, education, science and research. We’re going to need all of these capabilities if we want to more efficiently support and sustain our aging population, and to increase the complexity of our economy so it’s well placed to transition from its current emphasis on exporting ‘cows and dirt’.

      But we absolutely *don’t* have ‘ballooning health care costs’. Our 2009-11 annual average growth rate in per capita health expenditure was 0%. From 2000-09, it was 3%. We were below OECD average in both periods. http://www.oecd.org/els/health-systems/Health-at-a-Glance-2013.pdf (p.155).

    • Jon says

      One great way to make healthcare costs blow out is to reduce funding and access to primary and preventative care and mental health services. This causes the poor and pensioners to put of health care until they need an emergency visit, and causes increased load on the acute care system to pick up the pieces, as clearly evident in the US.

      Another great way is to privatise health care, and health insurance, now you have a profit margin in the mix, plus the incentive to prescribe unnecessary tests and squeeze more from govt subsidies.

      Yet another great way is to allow big pharma more unfettered access to our markets, and tighten IP and patent laws around generic drugs and government bulk purchasing. This pushes up cost of drugs by a huge amount, once again as evident in the US.

      Following the US system is a recipe for the highest govt spending on healthcare not the lowest, and thats exactly the path the libs are following.

  19. Steve says

    Lot’s of interesting numbers, thoughts etc.

    There is an idea being thrown around the web in a few forms, it goes like this…

    Pay everyone over 18 at least $30k, who is unemployed, retired etc.

    This way there will be people able to afford to live in an ok fashion, those who spend more than they used to will be adding to the economy, more gst revenue etc will mean more tax income to fund some of this. it will relieve a lot of stress and hopelessness, saving money on medicare etc.

    Have others seen or thought about this and can it be viable? e.g. paid for by some of the war plane $$…

  20. WT Gator says

    Pushing this out to my dozens of Twitter followers. Exceptionally well written piece, Glenn. :)

  21. Scott Farquharson says

    Glen,

    You are a muppet.

    Combining economic illiteracy and nativity with statistics without context and in some cases out of date and irrelevant to the argument at hand.

    Wonderful stuff.

    Here’s a thought, the past is in no way a predictor of the future, it’s not where the economy has been, but it’s where it’s going.

    Go have a look at the forward estimates and amongst other things, the challenges of an ageing population and the forward growth projections. You can’t spend your way to prosperity.

    Yes we are in pretty good shape but the very policies you seem to be arguing for are the very things to take us on that downward spiral. Yes we’re better than the euro basket case economies but who’d want to be them?

    I particularly loved the one about tony abbot being responsible for a rise in unemployment. Laughable.

      • says

        Glenn you have the best response to insults, if we had your kind in politics we wouldn’t have the house falling apart the way it’s been known to sometimes. ‘Thanks for your comment’ does make me laugh 😀

      • Scott says

        “Tony Abbott was responsible for rising unemployment”

        From the august 13 economic statement by chris bowen

        “The labour market is expected to remain resilient with slower wage growth, an important mechanism for supporting employment growth in the rest of the economy as the relatively employment-intensive resources construction phase passes its peak. Nevertheless, the unemployment rate is now expected to reach 61⁄4 per cent by mid-2014, owing to lower forecast real GDP growth and the current rate of unemployment being a little higher than expected. The unemployment rate is expected to stabilise at that level in 2014-15 but remain one of the lowest in the developed world, with many countries still feeling the effects of the global financial crisis”

        Muppet

      • Scott says

        And who was the goose saying the “rich” don’t pay their fair share of tax…?

        The truth is that the overwhelming bulk of people in Australia pay no net tax at all. In fact, only the top fifth of households ranked by their income – in 2011 those with incomes above $200,000 a year – pay anything into the system. For everyone else, the value of social security in cash and kind exceed taxes paid.

        And

        THE TOP 10 PER CENT PAY MORE
        Separate data from the Australian Taxation Office would appear to confirm the shifting distribution. Based on income tax returns from the 2010-11 financial year, the top 1 per cent of individual income earners – who in 2010-11 tax year were those with taxable incomes above $281,800 a year – paid $23.55 billion or 17.7 per cent of the total tax haul, up from 17.0 per cent in 2009-10.
        The top 10 per cent of taxpayers – with taxable incomes above $105,500 – paid 46 per cent, up from 45.3 per cent a year earlier. The bottom third paid less than 5 per cent in both periods.
        The highly, and increasingly progressive, nature of Australia’s tax burden appears clear, but why is this?

        • says

          I’m not sure who said that, but if they were paying their fair share, we wouldn’t have corporations dodging tax all over the place, nor would we have Abbott proposing a tax amnesty for them, nor would the rich be earning better tax concessions on their super contributions than everyone else. Nor would we be the world leader in tax concessions which, according to the IMF, “benefit most those in the highest marginal tax bracket and convey no benefit to those out of the tax system”.

          Re your claim that those under $200k per year contribute nothing to the system, do you have any verifiable evidence of that? (I’m not necessarily questioning its accuracy, I’m interested to see the facts.)

          • says

            What I mean is corporations dodge tax so they don’t have to pay their fair share. And rich individuals do the same so they don’t have to pay their fair share (and Abbott is going to offer them an amnesty). And the rich get higher concession rates on super contributions than everyone else, so they don’t pay their fair share.

            Thanks for the link. I checked it, and unfortunately, it’s not verifiable evidence, it’s just someone making the same claim you did, without offering any evidence:

            “Put simply, based on the best survey and statistical
            evidence, only the top fifth of households paid any
            tax. The bottom 6.9 million, while often incurring
            income tax liabilities and certainly regularly paying
            GST, received more in cash welfare and services
            than they paid in.

            The concentration of the tax burden on higher
            income earners would be starker still if the many
            tens of thousands of senior local, state and federal
            public servants – whose salaries often exceed
            $200,000 a year – were considered a cost.

            One could argue the taxes paid by workers whose
            jobs depend on taxing other workers are akin to a
            part cash refund to everyone else paying in, rather
            than an organic contribution to the funding of
            government.”

            I was hoping you might have some verifiable evidence to back this claim, that you weren’t just basing it on someone else’s unsubstantiated opinion. :-\

    • Jon says

      You absolutely can spend your way to prosperity, its called investment. Ever hear of a business loan? Capital investment? If the libs were running a business it would be a disaster in no time flat. They’d cut half their workforce without regard to expertise, cease all spending on marketing and future product development or upgrades. Bottom line would look good for two years and then the whole thing would collapse in an unrecoverable heap.

      • Scott Farquharson says

        Yes, private investment is the way to prosperity, not spending on stimulus or social programs.

        • Jon says

          So we should let old people live in poverty, and spend more on joint strike fighters?

          How about some more spending on coal subsidies?

          Seriously if you think social programmes are the problem you need to take your blinkers off.

        • Scott says

          Another muppet.

          Health and welfare spending accounted for $260b of Australia’s $350b budget. This the largest and fastest growing sector of expenditure.

          How much is spent?
          • In 2010–11, Australian Government and state and territory government welfare spending was estimated at $119.4 billion—$90.0 billion (75%) was in cash payments (including unemployment benefits) and $29.4 billion (25%) was for welfare services.
          • Between 2001–02 and 2010–11, government welfare spending increased on average by 3.1% per annum after adjusting for inflation.
          • Over the decade to 2010–11, the percentage of gross domestic product spent annually on welfare ranged from 8.4% to 9.6%. The exception was the 10.4% recorded in 2008–09, which coincided with the Australian Government’s Economic Security Strategy in response to the global financial crisis.
          • Non-government community service organisations play an important part in
          the delivery of welfare services. However, non-government expenditure is not included in the estimates presented in this chapter, primarily due to the difficulties in obtaining comprehensive data. Government funding to non-government organisations is included.
          • The Australian Government Treasury estimates that $36.6 billion in revenue was forgone through welfare tax deductions and concessions in 2010–11. This amount is not included in the estimates of total welfare expenditure. The majority of the foregone revenue ($28.2 billion, or 77%) was for superannuation concessions.

          And

          Expenditure on health in Australia was estimated to be $140.2 billion in 2011-12, up from $82.9 billion in 2001-02. This expenditure was 9.5% of GDP in 2011-12, up from 9.3% in 2010-11 and up from 8.4% in 2001-02. The estimated recurrent expenditure on health was $5,881 per person. Governments funded 69.7% of total health expenditure, a slight increase from 69.1% in 2010-11. The largest components of health spending were public hospital services ($42.0 billion, or 31.8% of recurrent expenditure), followed by medical services ($23.9 billion, or 18.1%) and medications ($18.8 billion, or 14.2%).

          • says

            Thanks for taking the time to share this info, Scott. But I think you’re missing the point. No-one’s contesting that we spend quite a bit on welfare. What we’re saying is:

            1) Relative to the OECD, we spend very little on pensions and cash benefits, and our other public spending is about average per capita.

            2) Some people need support. Bitching and moaning about the cost of that support doesn’t change that fact. Who do you think will support them if not the government? Private industry certainly won’t.

      • Scott says

        Where do you think investment comes from? And don’t say government, I’m laughing enough already.

        It comes from the private sector. Business and savings.

        Btw, who’s taking out your “business loan”? And again, pls don’t say government. I’ll spit out my coffee.

        Ideologue, hardly, just not as economically naive and ill informed as the tosh I’ve seen here.

        • says

          Again, Scott, you’re missing the point. Of course taxes come from private industry and individuals. But the whole idea of taxes is to pay for stuff for society that the individuals alone can’t pay for.

          • Scott says

            Really, that’s the role of government?

            First I’ve heard.

            I’d check the constitution, but I digress.

            Most of this looks like a class war, big old fashioned income redistribution to me.

            “Compared to the OECD” – so what?

            Glen, you have put together a series of historical, unrelated, some out of date, graphs and statements, purporting to be research, to support an argument that goes something like this – we’re not too bad compared to the OECD, so it’s not as bad as we think so we can afford to spend more.

            So what. Do we really want to be like most of the euro basket countries?

            The problem with all of it is that it is history, the past, finished and has no relevance to where we are going other than providing a starting point.

            The facts are that we have a significant structural deficits and an ageing population which the dual effect of both reducing the tax base and increasing expenditure.

            It’s not ok.

            Furthering these memes does nothing but give ammunition to the nuffy low information voters that you will undoubtedly attract and feed this ridiculous “all conservatives are evil” garbage.

            Adults have to make decisions in the real world and hard choices will have to made.

            No one on either side of politics wants to see the poor get poorer but the extent of support must be very carefully targeted to what the country can afford.

            I cannot understand this anti capitalist garbage, western democracy and capitalism has done more to pull people out of poverty that all the hand outs, foreign aid and NGOs put together. Look at Korea, China, Japan, the emerging economies of Asia.

            Grow up.

          • Scott says

            Btw, the data supporting Adam’s article is freely available, maybe you could go and look yourself. That would be research.

          • says

            Scott, it seems ironic to me that you’re here calling everyone names, abusing people and ignoring inconvenient data, while at the same time advising me to grow up and suggesting that anyone who doesn’t accept your unfounded opinion is not an adult.

            In any case, it’s a shame you’re too set in your opinion to consider evidence. But that’s your prerogative, I suppose.

            I do agree with this statement of yours, however:

            “The facts are that we have a significant structural deficits and an ageing population which the dual effect of both reducing the tax base and increasing expenditure.”

            But it’s clearly not a crisis. It’s just an ongoing situation that needs to be sensibly managed. Not by targeting our most vulnerable and undercutting our future prosperity by cutting funding to vital infrastructure.

            And I’ve not said I’m anti-democracy or capitalism. Nor am I. But I am opposed to a completely unregulated open market. We’ve seen the damage that causes.

            And thanks for letting me know that the data supporting Adam’s article is out there. I’ll take that to mean you haven’t researched it yourself, but you’re here offering his opinion to as evidence, merely because it supports your opinion?

        • Jon says

          If you think government cant invest, I’m not sure what you think is going on in China.

          Government might get its money from taxing private economic activity, but it can still invest the money that it has. Whats more it can invest in projects that produce long term economic benefits for everyone that no individual person or company could. Things like say building the internet.

          The old libertarian line that govt cant create jobs or invest in prosperity is just complete bullshit. Thats not to say they always or even often do it right of course.

          What conservatives are claiming at the moment in this country is that “the problem” is welfare spending, but just because it (collectively mind you, its not all dole payments) is one of the biggest ticket budget items.

          However what they are really saying is we want to take money away from the poor and pensioners because they show up as a cost. But the other side to the budget coin is revenue, and we seem to be able to afford to supplement superannuation and property investment for the rich (who dont need it) with policies like negative gearing and super tax offsets. Those two things alone are worth something like $30 billion in lost revenue, why arent they on the table?

  22. Liz says

    Of that 14.4% below the poverty line includes pensioners; and by pensioners am referring to those who solely rely on the pension to live – it seems that when people talk about those in low income brackets they are referring to the wage earners – well pensioners are also classed in that bracket and they are well and truly below that poverty line.

  23. Grant says

    So what you are saying is, here are some graphs, lets continue running a 40 billion dollar deficit into the foreseeable future.

    I dont agree.

    • says

      Well, no, I’m not actually saying that. I’m saying we don’t have a debt crisis, and claims to the contrary are purely manufactured in order to cut funding to vital services in order for the government to look good to a voting public that views economics as a big version of household budgeting.

      In economics, a deficit isn’t necessarily a bad thing. In fact, some economists believe running at a deficit is the way things *should* be done. And most economists agree that cutting spending results in increased unemployment and a slowed economy.

      • em says

        and when you run at a deficit , is it correct that you become more attractive to off shore investors? just asking as I’m not sure

      • Scott says

        More ‘fairy’ economics! Tell me this, where do the accumulated deficits go? Currently we have a significant structural deficit, that is we spend more that we tax, that is set to accelerate with an ageing population and growing health and welfare spending. These accumulated deficits are paid for with borrowed money that interest must be paid on.

        That’s sustainable…..???

        As Paul Keating once said, fairies at the bottom of the garden.

        • says

          Hi Scott. Thanks for taking the time to comment. The fact that you think my perspective is a fairytale tells me that, like Boris above, you’ve misunderstood the article on a few counts:

          I’m not suggesting we run permanently at a deficit. What I’m saying is that cutting vital investment is not the way to reduce the structural deficit. It is, however, a great way to fudge the books, to make it look like you’re improving the economy, when you’re actually undercutting our quality of life and our future.

          • Scott says

            Please explain this “vital investment”?

            The way to prosperity is private investment in value adding production and improved productivity. Full stop.

            This is the only way to higher wages, standards of living and the ability to fund necessary safety nets and social program’s.

            That means a governments main activity is to provide a low tax, low red tape, competitive environment for business to flourish.

            And don’t get me started on the definition of poverty. Half the median wage is it? Convenient that we’ll never see an end to this so called poverty. This isn’t poverty. I seem to recall that this definition of poverty meant a standard of living similar to median wage in the mid eighties? Poverty should be accessed in absolute terms.

          • says

            Vital investment means health, education, science & research, and welfare.

            Without a good health system, you end up with unhealthy people. Obviously not good for society or our economy. And if you privatise it, you simply increase the cost of accessing that healthcare, so only the rich can afford it, which leads to the same point.

            Without a good education system, you end up with a population that can’t compete internationally, and, as a result, an economy that can’t compete with more complex economies globally. So when we run out of natural resources to flog off, we’re left with only simple industries, which rely only on simple labour cost equations. In other words, it’s a race to the bottom as we compete to be the most affordable labour force.

            Ditto for science and research, with the added bonus that we also don’t contribute to the development of any viable alternatives to coal powered energy production.

            And of course welfare is a vital investment. Without a good welfare system, how do those people who can’t support themselves survive?

            Private industry isn’t interested in national prosperity. It’s interested only in short-term profits. If you honestly believe otherwise, then please provide some verifiable evidence to back your claim.

            Re the definition of poverty, if you have a more robust one, please feel free to share.

  24. Ian says

    “Just my ramblings”

    Thank you Glenn, your ramblings are more credible that Hockey’s ravings.
    We need more well-considered, thought-provoking comment like this as an antidote to Hockey the fear-jockey’s bullshit.
    It’s a pity the mainstream media will give more column-space to his poisonous diatribe than to well researched and truthful comment. They are too corrupt and biased.

  25. Ian says

    BTW, my dictionary defines HOKEY as >excessively sentimental or contrived<
    Have we been mis-spelling the treasurers name, or is it just coincidental?

  26. Mark says

    The fact that we have to endure Abbott is due directly to the lack of actual difference perceived by voters with the two political parties (or should I say three, given that the conservatives cannot exist without the coalition?). We don’t have one vote per voter, one allowed recipient. We have no control as voters as to the actual recipient of our vote. Correct these anomalies and we just may correct some of the imbalance that has overtaken our purported democracy. It doesn’t help that both sides of politics are imbued with wealthy, self serving lawyers!

  27. Peter says

    That’s a simple and graphic (excuse the word play) summary Glenn which I will share for sure. Abbott talks in parables and uses tried and true propaganda techniques. Thankfully people like you will shine a light on this.
    I’m hoping also that, love or hate him, Clive Palmer will continue to debunk Abbott and co in his simple style. At least it will promote debate and help to reach the ignorant and indifferent in our society.

  28. Shirin says

    Thanks for your well researched article. It is frustrating to watch all that is happening, the stats you found are briiliant, it would be great to see your report on ABC or SBS, cause we know we’ll never see it on Murdoch’s crappy media

  29. says

    I’ve never understood why people voted for someone who labelled that carbon tax as a ‘Great Big Tax on Everything” when the main cause of the increases in electricity prices was the gold plated electricity network – http://www.businessspectator.com.au/article/2013/7/2/energy-markets/declining-demand-rising-prices-%E2%80%93-there-something-wrong

    The real problem was lack of foresight and effective regulation, something Abbott’s policies are likely to make much, much worse.

  30. Mike says

    Hi,

    Thanks for the article, it was interesting and informative. The poverty rate changes from 1995 – 2010 struck me. Given ours have increased in this period regardless of which party has been in power. The data is misleading though, it does not contain statistics after 2010. Given 1m people have requested help from food-banks in the UK this year, I find it hard to believe that their poverty rates (and this goes for all of Europe) are at the levels stated.

    Comparing us to other OECD states can also be hit and miss, given so many of them are in a worse state than we are economically. However there is not really much else we have to go on.

    We have a revenue structural issue in Australia which started with Howard/Costello cutting taxes, then Rudd/Gillard following suite and then spending more without fixing our revenue issue. I don’t see this as a Liberal vs ALP issue myself. Both sides own a piece of the pie when it comes to this issue we face in this country. However blaming Abbott for some things is very partisan and a little bit silly….closing the “national office for live music” isn’t related to our debt/deficit issue, but it does generate a bit of outrage. And Health premiums always go up no matter which party is in power.

    Overall however, informative and thoughtful.

    Cheers
    Mike

    • says

      Hi Mike. Thanks for your thought-out comment. I’ll answer a point at a time, so I don’t overlook anything (my brain needs structure! 😉 )

      1) Re the poverty data, I don’t have anything more recent. That’s from the OECD’s 2014 ‘Society at a Glance’ report. Things may well have changed since then, but I don’t have any more up-to-date data. If you have some, I’d love to see it. :-)

      2) Re the relevance of the data, the OECD explains it best:

      “Perceptions of a decent standard of living vary across
      countries and over time. Thus no commonly agreed
      measure of poverty exists across OECD countries. As
      with income inequality, the starting point for poverty
      measurement is equivalised household disposable
      income provided by national consultants…
      People are classified as poor when their
      equivalised household income is less than half of the
      median prevailing in each country. The use of a relative
      income-threshold means that richer countries have
      the higher poverty thresholds. Higher poverty thresholds
      in richer countries capture the notion that
      avoiding poverty means an ability to access to the
      goods and services that are regarded as customary or
      the norm in any given county. The poverty rate is a
      headcount of how many people fall below the poverty
      line.”

      In other words, I think it’s a fair assumption that someone below the 50% line in one country will have about as much trouble affording necessary goods and services as someone below the line in any other country.

      3) Re structural deficit, yes, we have one, but it’s by no means at crisis level. And cutting vital investment is not the way to reduce it. It’s just a good way to fudge the books, to make it look like you’re improving the economy, when you’re actually undercutting our quality of life and our future.

      4) I’m not blaming Liberal for all the issues we face. I’m merely saying I think the approach they’re taking now is wrong.

      5) Re the music industry, I disagree. This post isn’t only about the debt, it’s about the impact of the cuts. Musicians, as a group, tend to struggle. Cutting investment in the industry will increase poverty among musicians and undermine the industry. That said, it’s certainly not irrelevant economically, either. It may only be a relatively small impact on our economy, but it’s still relevant.

      6) I haven’t tracked increases in private health insurance premiums. Do you have any data on that?

      Thanks again for your comment. I appreciate you taking the time (and taking the time to read my ramblings to begin with!)

  31. Ian Gammage says

    You need to add that they have increased to contribution for PBS medicines too. Now $6.00 and I pay $8.90 for one of mine as the Govt will not meet the manufacturer’s price increase plus another costs me $80 per script.

    • josephine says

      Medication prices for pensioners have been going up yearly for at least the last 10 years. Nothing to do with current government. It was $5.90 last yr and is now $6.00. The brand price premium is a premium the patient pays if they want the originator brand and not another brand of a particular medication. The government pretty much decided (a looooong time ago) that if a patient wants a particular brand when there are far cheaper generic brands (of the same thing ) available, the patient can pay for it. With regards to your $80 medication- depending on what you are usinh it for there may be an alternative that might be covered under the pbs.

      Just fyi…:)

      • says

        Hi Ian & Josephine. Thanks for your comments. Josephine, I know you’re replying specifically to Ian, but I wanted to make it clear that my original assertion that Abbott will be responsible for a price hike in medications is based on his backing of the TPP. That’s an entirely different kettle of fish from anything that’s currently contributing to price increases. Under the TPP (with its ISDS clause), our gov will experience pressure to not legislate to keep medication pricing down (i.e. they’ll be pressured to allow patents that increase prices). If they don’t, they’ll face legal action from the pharma companies that own the patents – for impeding expected profits… :-(

      • Cara says

        There are more medications NOT on the PBS than are. My own medication costs $90 a month. Not on PBS and no similar cheaper medication. You’d be surprised what isn’t on PBS. For example – Epi-pens have only fairly recently made the list but still cost almost $40

  32. Kimberley Brandt says

    Hi.

    Great piece…very well delivered – thanks! I’ve shared & urged others to consider our economic position when forming opinion on the upcoming budget.

    One question. Could you please advise the source for the top graph on poverty rates?

    Cheers & thanks again for the good work.

  33. Matthew says

    Bullshit
    There IS a debt crisis but not in the government sector (for us). Add BANK and CONSUMER debt to the mix and you will find that debt has become a much larger problem than people realise.
    The reason for the increase in debt is the housing boom and cheap money – interest rates are down.
    Why is this a concern? Because govt’s like to add ‘stimulus’ which means that the debt will be transferred from private to govt debt (case in point, Japan, who have been ‘stimulating’ since the 1990’s and now have a HUGE govt debt).
    The current government will try and stimulate their way to a recovery, which will mean the AU economy will follow Japan’s into stagnation.

  34. Bill Johnson says

    Don’t you know we need the USA system here in Australia?
    – A handful of uber-wealthy who can buy election results.
    – A vanishing middle-class
    – A growing underclass to serve the uber-wealthy, the working poor
    – Lemon socialism (socialism in the USA? Yes!) … anything that makes a profit has to be privately owned, and anything that runs at a loss, well, must be government run (by definition)
    – and most important, lots of guns (particularly for children and the mentally ill)
    “Trickle-down” economics has been shown not to work, time and time again. Yet the world’s right-wing keep the faith and keep trying it.
    Difficult years to come I suspect

  35. says

    I know the single best thing we could do for the Australian economy is to nationalize the RBA and coin our own money, instead of having our privately owned RBA lend money to the Government with interest, So there is never enough money in supply to furnish the debt – Ellen Brown and Ben Still have done the research on this.
    Then we have to nationalize State Banks for every state in Australia, based on the North Dakota State Bank model, which has proven to be a success story, being the only state in the US where the economy and employment stats didn’t suffer during the GFC – http://londonprogressivejournal.com/article/view/1723/from-austerity-to-prosperity-why-i-am-running-for-california-treasurer
    Most debt could be written off because it was gained illegally. The derivative debt could be absorbed by the banksters and the practice outlawed along with naked short selling etc
    We also have to look at what Iceland did during their economic crisis, they jailed all the corrupt bankers and politicians who got them into the mess and wrote off most of the debt which was illegally gained by corrupt practises anyway, forgave home loans and got their banking system in order. They also refused the IMF ownership of their seafood industry, that they requested and now Iceland is becoming prosperous again – http://beforeitsnews.com/power-elite/2014/04/iceland-dismantles-the-corrupt-then-arrests-ten-rothschild-bankers-2445476.html
    Another positive step would be to nationalize all the mines we could and abolish any tax breaks or financial assistance to Gina and her fat cat ilk and introduce a real mining tax like Rudd and swan wanted, only to be watered down to nearly nothing by Gillard. As well Murdoch and all the other $billionaires and corporations that are getting massive tax payer funded relief need to be reigned in and forced to pay a fair wack or piss off and let the govt work on nationalizing their business models if we have to
    For employment Australia has to scrap all the free trade deals and reintroduce tariffs to protect Australian jobs and industries – http://www.oziz4oziz.com/aussie-job-security.html
    We also need to scrap outsourcing and offshoring to protect Aussie jobs
    The rich need to pay their fair share of tax and tax haven loopholes need to be closed with harsh penalties imposed on offenders to deter the trade.
    With all this extra money, industries and jobs in Australia you could cut the tax rate on low and middle income earners and raise welfare payments to cause a boom in spending and add even more jobs. Then we could gradually start to buy back all the privatized assets that we have been robbed of and abolish all toll roads and parking metres
    If Australia did all this Presto we would be the most prosperous nation in the world. The only problem is that the US and coalition of the willing ruled by the International banksters would declare war on us to bring us back to the fold of endless debt, austerity and enslavement to the elites and corporations who run this world

  36. BoomerMMW says

    Hi Glenn, a brilliant perceptively balanced article filled with researchable information, you seem to have an excellent answer to the people who have challenged here. I wonder if you have thought of forming your own party and entering politics, you could be one of those rare things. A Voice of Reason.

  37. Joanna says

    A very interesting read indeed. However, whilst I wouldn’t say your graphs and comparisons are incorrect, I am aware how statistics can be presented and manipulated to support an argument. I’m not saying you have done so here, I just view any such with a critical and dubious eye.

    This goes to the point I want to make about politics and people in general.

    There’s a large problem with the Australian voting population in that they are mostly ‘one-eyed’ about one side of politics or the other. They vote Labs or Libs because “I always have”. They then proceed to turn a blind eye to broken campaign promises with silent acceptance but scream blue murder when their opposition does the exact same thing. In my very humble opinion there’s a great lack of objectivity by people when it comes to assessing political parties, their respective performance and policies. This type of ‘support’ is fine for your favourite football team etc. but really should not be the case with politics, there’s too much resting on the outcome.

    A sweeping generalisation? Possibly, but I don’t think I’m far off the mark. It’s also a difficult thing to overcome when human nature comes into the equation.

    Personally I’m fed up with so much of our politician’s time being wasted on finger pointing, blame allocation and digging up dirt to try and undermine reputations. The media, of course, feed on this like carrion on a corpse and the general public lap it up like the latest episode of their favourite soap opera. For any politician and/or political party to piously shout about the opposition having lied or broken a campaign promise is pure hypocrisy. They all do it. They shouldn’t, but they do and history bears this out.

    My wish is that our politicians would stop with the melodramatic attention seeking and just get down to the job at hand. Another aspect of our politics that I feel should be removed is choices, policies and legislation based on the religious convictions of the politician of the day, but that’s probably a topic of discussion for another time. I think I have digressed already.

    You mentioned a direct democracy component such as the Swiss have, I look forward to hearing more about that.

    • says

      Hi Joanna. Thanks so much for your comment. I agree with everything you’ve said. I’d encourage people to view my entire post critically. Not because it contradicts their favourite team’s rhetoric, but because there’s a chance I may have some stuff wrong, and I may have misinterpreted some stuff. But mostly because in doing so, they’ll learn a lot more than they ever will from the mainstream media and politicians!

  38. Ian Thiele says

    Much of the action Mr Abbott is taking is stake up our resources for the future. The economy Abbott inherited was all social hand out and that is unsustainable in the long term. Yes there must be social justice but never at the expense of our nations economic future. Labour has much to answer for. Every Labour government has increased our national debt. We may be still lower than other nations but it was still and increase. We must stop looking at the now needs and see the future needs of our nation.

  39. Gerry says

    Reality is that nothing has changed, labour gives money and liberal / nationals try and take it all back…the same thing has been happening in Australian politics ever since I can remember.

  40. says

    Wow! Thanks for your comments, everyone. And for reading. Sorry I haven’t been able to reply to everyone individually. I need to get some work done, or I’m going to miss deadlines and go broke! 😉

    That said, I’ve tried to reply to everyone who’s disagreed, and hopefully I’ve answered your questions.

    Out of interest, can a few of you tell me where you heard about this post? I know March Australia shared it, but my traffic exploded about 3 hours before that (well, 3 hours before Facebook says they shared it). Most of the traffic is coming from Facebook. Last night I had 388 people reading the post at one time. And for the past 36 hours, there’s been an average of about 200 people on the page at all times. Amazing!

  41. Damian says

    We pay $1,015.17 for a ride in an ambulance to an emergency department here in Victoria. I think this is the worst rip-off in healthcare that I have seen. How can the Ambulance service charge this when someone needs critical care yet the same patient can visit a GP every week for free? What about giving people a set amounts of free GP visits per year based on profile date – age, wage, health condition and location for example.

  42. Judy says

    I wonder if Tony Abott is just working from John Howard’s play book. I seem to remember John Howard’s first budget beeing very harsh as well. He slashed through many welfare and social services including legal aid and the peak bodies such as ACOSS etc. He also introduced gag orders to ensure anyone receiving government funding can not be publicly critical of government. In other words he systematically attacked all the institutions that provide advocacy for the disadvantaged. After demoralising everybody and creating fear in the hearts of the underprivileged he then bought us all of by giving handouts just before his next election.
    Tony is probably doing the same thing. Give us all a good raping now, then, later, we will get a hand full of lollies to make us feel better before the next abuse.
    Sadly, I believe that the reverence people lavish on the rich and powerful, just indicates that most of the world is suffering from Stockholm syndrome. Many of us have now come to identify with and revere our abusers. This is why the population as a whole seem to be so apathetic and accepting of the direction the world is headed.

  43. Jamie says

    Did you know poverty rate is derived from those with incomes below 50% of the median equivalised income, which is the requirement of a larger household to have a higher level of income to achieve the same standard of living as a smaller household.

    Therefore, in relative terms, the poverty rate in each individual country is only relative to that individual country – and not to the overall standard of living. So if you live in the Czech Republic (lowest poverty rate), you won’t have a better standard of living, you will have a relatively equal standard of living to others within that country.

    These charts show income disparity, not the relative value of benefits achieved and as such standard of living through welfare etc. As such – any chart comparing us to an OECD average or other country is redundant as it is not relative to the point of the article.

    Further, any chart comparing expenditure to the percentage of GDP is redundant as it does not identify the purchasing power of that spend at a per capita basis. i.e. Portugal (higher GDP spend on healthcare than Australia) has an equivalent USD $2000 per capita spend on healthcare whereas Australia has an equivalent USD $5900 per capita spend on healthcare.

    In short, the article is full of shit, any graph comparing Australia to other countries and OECD averages is full of shit, and any article comparing spend to percentages of GDP is full of shit, there is no relativity in any of it.

    • says

      Hi Jamie. Thanks for your comment. Yes, I’m aware of the OECD’s definition of poverty and the difficulty in measuring it. And yes, I know it’s measured in relative terms. But by definition, it’s a fair assumption that someone below the 50% line in one country will have about as much trouble affording necessary goods and services as someone below the line in any other country. So the poverty charts are no irrelevant.

      And yes, I’m also aware that our health spending per capita is slightly higher than the OECD average. And I said that in the post. But the GDP graph is a good illustration of what we can afford.

      In any case, those two graphs aside, do you have any reason to suggest the article is full of shit?

      • Jamie says

        That assumption requires a standardised distribution of income in all countries, and also does not take in to consideration non-income benefits i.e. welfare. As such, they are still irrelevant.

        I will make the point that your chart suggests people are best off in the Czech Republic, and also better off in Slovak Republic, Slovenia and Estonia, then they are in Australia.

        Those charts aside, the same case can and should be made for every other comparison of Australian expenditure relative to other OECD countries, and any comparison of expenditure as a percentage to GDP which is not relative to GDP per capita. Not just in your article, but anywhere. I can go in to detail on things like healthcare but would rather not, because the point is very clearly relativity of data.

        Further, squaring blame of things like a changing unemployment rate purely on Abbott, not on economic and industry cycles and underlying factors, as well as focusing squarely on how much has been cut and not on the relative value per dollar spent and any alternatives, all contribute towards my position on why this article is pure fear mongering.

        So I put the question to you, respecting your view as your view and not intending to insult you, how much do you really understand about each topic you have raised as a criticism of Abbott?

        • says

          No, it doesn’t require a standardised distribution of income in all countries. It’s merely a relative measure that suggests people in the bottom half of the household income continuum will have more trouble accessing all the goods and services they need than those in the top half, no matter which country they’re in. And according to the OECD, this constitutes poverty.

          Incidentally, regardless of whether you like the term poverty, the fact remains that Australia has more pensioners below the 50% line than any other country.

          Re non-income benefits, it’s a valid point, but doesn’t change the big picture a helluva lot. I answered this concern in the comments above. No point copying and pasting here. http://www.glennmurray.com.au/abbotts-war-on-the-rest-of-us-and-why-theres-no-need/#comment-3189

          To suggest GDP comparisons are irrelevant is ridiculous. These comparisons show what we can afford. If I showed only per capita graphs, you’d complain that I was ignoring affordability.

          You’re right about the unemployment rate. There are other factors at play. Mind you, the loss of our auto industry can be placed squarely on Abbott’s shoulders.

          As for the dollars spent on alternatives to the programs cut, to my knowledge their aren’t any. The only one that even comes close (but nowhere near close enough) is the cut to Operation Newstart. The gov says they’ll divert this money to communities “to allow them to deliver effective local solutions to crime and antisocial behaviour by installing measures such as CCTV and better lighting.” In other words, they’re going to replace a program aimed at resolving problem behaviour with a bandaid that merely transplants it to a different location.

          If you think the gov will replace the cuts they’ve made, perhaps you can tell us how?

          So, in answer to your question about my understanding, I believe it’s more than sufficient to raise criticism of Abbott.

          • Jamie says

            Glenn, if 80% of income earners make 10k, and 20% of income earners make 12k, the 50% poverty threshold is 10.4k and 80% of earners are below the poverty line.

            If however 20% of income earners make 10k and 80% of income earners make 12k, the poverty threshold is 11.6k and only 20% of income earners are below the poverty line.

            In the latter example, if for an equivalent standard of living to Australia you require an income of 20k, that is not relative to the fact that only 20% of income earners in the said measure are below the poverty line.

            Not only is that a very clear representation of income distribution and its impact on perceived ‘poverty’, poverty as measured by the OECD is relative only to income in each individual country, and has zero bearing on relative standard of living and accessibility of goods and services.

            I am not very interested in arguing about the affordability or position on different social policies as that is a debate that would go for ever, i am purely interested in highlighting the fact that the graphs used in this article have absolutely no relevance to the points you are making.

            Though on one comment you made, if the loss of the Auto Industry results in cars being 30% of current cost then the relative individual capacity to spend increases and people can afford to purchase alternative goods and services.

            This increase in purchase capacity results in greater demand for alternative industry, creating jobs, The money individuals and governments have to spend does not disappear and can be invested elsewhere i.e. pension funds or healthcare. \

            It is moot however to highlight individual circumstances within sectors when not considering the wider impact and longer-term implications.

          • says

            Jamie, I understand the point your making, but I disagree. Firstly, you’re raising hypotheticals as an argument against actual data. Yes, there may be practical problems with the data, but there may also not be.

            If you believe there ARE problems with the data (i.e. that the comparisons made ARE in fact confounded by the problems you’re suggesting, and not just POSSIBLY confounded), then please provide some verifiable evidence.

            Ditto for your hypothetical (and simplistic) auto argument. IF cars become 30% cheaper? Big if. What we KNOW is there’ll be a lot of jobs lost.

    • Jenny says

      Jamie, please read the article and comments again. Your comments have already been addressed. So in fact, your comments are the “s@#t”!

  44. says

    Hi Glenn I saw your link on the QandA twitter feed
    I notice my last comment posted a few hrs ago about my ideas for an economic recovery, still hasn’t been moderated yet;. Would love to get some feedback from you about it.
    Sensational blog Glenn, have found it very very informative. Cheers .

    • says

      Thanks for the feedback, Brian. I’ve run out of time today to spend on my personal blog. Gotta get some work done. Hopefully I’ll have some time tonight to review your comment. Looks interesting.

  45. markus says

    First I would think it fair to suggest that the man would never have imagined that he would be PM right now. His appointment has only been brought about by the self implosion of the labor party.

    Secondly, comparing Australia to the US and UK, is absurd. Both countries have had double maybe even triple dip recessions. Australia by every gram of oxide in it’s mines, has not seen the devastation. The social demographics in both the US and Uk are vastly different in terms of needs, education and lifestyle than Australia, and food poverty is not just a result of bad policy making, but an endemic lack of a rounded education that extends beyond the classroom into the home. ( With the entire internet at your disposal, i have no idea why you chose Aljazera as a source)

    Thirdly, Australians are MASSIVELY overpaid. It may seem offensive to any blue through and through ozzie, but can you really have a fair job market when an electrician can earn more than a doctor? Needles to say, the reason Australian manufacturing is so weak, is that its nigh on impossible to find countries that can afford to pay for Australian goods.

    Here are the list of cuts by Abbot you posted with some suggestions as to why they might have been done- and if i agreed with you

    Increased the unemployment rate, Extremely circumstantial that this is directly Abbot
    Suspended the Wage Connect program, despite it being proven to deliver good outcomes for unemployed people, Again if there was enough evidence for it being a good outcome, it would just have been rebranded
    Cut funding from Operation Newstart, an early intervention program for vulnerable youths, Federal programme- unless you want to go stateless, that needs to be state run

    Axed funding to the Alcohol and Other Drugs Council of Australia – see above

    Converted Start-Up Scholarships into loans, increasing the debt of 80,000 higher education students by $1.2 billion Have a look at the student debt rates in other countries, and the problems they have in affording it.

    Abolished the National Housing Supply Council, which provided data and expert advice on housing demand, supply and affordability Needs to be state run, blah blah

    Abolished the Advisory Panel on Positive Ageing, established to help address the challenges the country faces as the number of older Australians grows See above

    Scrapped the Social Inclusion Board, which had been established to guide policy on the reduction of poverty in Australia, you have just shown how little poverty there is relatively.

    Scrapped the Home Energy Saver Scheme which helped struggling low income households cut their electricity bills Nationalised energy projects are a good idea- so this is pretty bad
    Cut funding to Indigenous domestic violence support services havent heard about this-
    Completely defunded the National indigenous legal service pretty terrible
    Abolished the position of co-ordinator-general for remote indigenous services pretty bad
    Abolished the National Office for Live Music along with the live music ambassadors ( are you serious)

    Increased private health premiums, Its funny that the next one combats this one.
    Cut funding to public hospitals by half a billion dollars- This is such a hot argument i don’t think its anywhere near finished.

    Taken away promised pay increases to childcare workers
    Taken away promised pay increases to aged care workers
    These are both bad

    Repealed pokie reform legislation that combatted problem gambling
    to be honest some people want to spend their retirement at a pokie machine and do so safely and in the process, staying in the cool/ shade and in a social setting. It has become their entire social identity, you are simply causing a massive headache by limiting playing times etc.

    Reduced tax breaks for small business this is crap, its merely tax re-organisation.

    • says

      Thanks for your comment, Markus. I appreciate the time you put into it. I disagree with you on a few points though:

      1) Comparisons with the UK and US are not absurd. Obviously policy can lead to food poverty. Note, however, that I didn’t say it was the primary cause, as you’ve implied. I said it was a significant contributor.

      2) Where is the verifiable evidence that Australians are massively overpaid? Certainly the gap between and poor doesn’t support this opinion. Nor does the poverty rate or the homeless rate. Merely saying an electrician can more than a doctor proves nothing. Yes, our manufacturing is weak because of our relative wages, but you can’t just reduce wages without reducing living costs.

      3) Unemployment rate. I agree it’s circumstantial at the moment, but it certainly won’t be when we lose our auto industry, and that’s on Abbott.

      4) Re Wage Connect Program. It’s not sufficient to say it wouldn’t have been cut if it was effective. Where’s your verifiable evidence.

      5) Operation Newstart and Alcohol and Other Drugs Council of Australia. I appreciate your opinion that they need to be state run, but that is merely opinion.

      6) Student debts. The trouble students have repaying loans is my very point.

      7) National Office for Live Music. Not sure why you think this isn’t a serious cut? Music contributes to our economy just as other industries do, and musicians are real people who experience poverty just like everyone else (although I’d hazard a guess, at a higher rate).

      8) Pokies. No matter how you want to rationalise it (safely, cool, social setting), gambling is a massive social and financial problem in Australia.

      9) Reduced tax breaks for small biz. If crap, please provide verifiable evidence.

  46. Peter says

    Anyone can write a one liner above some selectively chosen graphs to try give them credence.

    I mean, come on. Comparing us to the OECD and saying with this “lower”, “higher” commentary is just rubbish. “We have very low dept”. What the hell does that even mean? We should rush out and borrow more money? Do we create a government ponzi scheme to make ourselves feel richer on debt? How much dept would we have if mining and China had not pumped up our economy. How do we pay off more debt if we accumulate it? Another Telstra or Commonwealth Bank sale?

    “We spend less on welfare than all but 4 countries…” What other factors contribute to this? Maybe we have a lower unemployment rate. Maybe minimum wage is higher so less distribution of wealth is required. Maybe our population is younger. Maybe people work longer…. You could go on forever.

    I could go one forever….

    How about some well thought through and balanced assessment along with proper context for one liners and pointless graphs.

    • says

      Thanks for your comment Peter. I’m sorry you don’t see the relevance. If you have any verifiable evidence to refute my claims, please feel free to cite it.

      • Geoff says

        I see the graphs, many of which could be interpreted from a few angles.
        I see the list of Labor induced committees and talk fests to `fix’ problems with money – unfortunately not much of which ever gets to the problem.
        I see Shorten and the crowd still not accepting their fate in opposition Hey you were voted out – get on with it and develop some policies that work! yet they still hold on to the carbon tax dinosaur and continue to navel gaze as if anybody is interested.
        I see a lot of folk spruiking about ideology and fascist policy and Marxist thinking and on and on –
        Gentle folk talking is past -How many of you are in a political party – boy if the `pin heads’ as mentioned can do it ; Where are you. It is easy to sit and criticise but it seems all the `thinkers’ are on the sidelines jeering.
        Abbot might not be the one but he is there doing his thing for better or worse.
        Evil only continues because good men stay quiet (or something like that!)

        Please spare me all the coffee table jibe: Democracy is about people standing up and doing something – Labor could only pay lots of people to sit down and talk – action , not splurging money will get the wheels of our economy moving.
        Jobs created by business getting on with it, not more quangoes navel gazing at everything you can think about and get your mate on at $150k per year.
        Productivity is meant to produce and production comes from healthy businesses who employ people. Somewhere in the last 6 years businesses were seen as somebody to bleed dry and exploit to the benefit of the worker; durrr!
        Workers only exist if there are businesses – this is something the ex union ex lawyers ex everything except someone that actually had actually run a business or understood something to do with the basics of running an economy who make up the Labor party failed to understand.

        I love the intellectual exchange but please spare me the weeping and whinging unless you are prepared to stand.

        :)

        • says

          Thanks for your comment Geoff. Much appreciated.

          Which graphs in particular do you find unclear or ambiguous? And why?

          Do you have any verifiable evidence that the programs Abbott is cutting were, as you claim, ineffective?

          Re spruiking: Are you not doing the same, simply by commenting here, and backing Liberal policy over Labor?

          Re accepting being voted out: I didn’t vote for Labor, so obviously that comment doesn’t apply to me. But if it did, I’d say simply that democracy doesn’t end at the polling booth. We need to be vocal about the issues we disagree with. Given your insistence that “Evil only continues because good men stay quiet”, I would think you’d applaud that?

          I’m not a member of a political party, myself, and I don’t plan to become one. I believe our current system is flawed and that’s why we’re stuck with the choice between two parties that don’t even pretend to represent us.

          As for doing something, how do you know we’re not? Surely you can’t think that writing about social and political problems by way of raising awareness precludes other political activity? And surely, even if it did, you would still support the raising of awareness as an end in itself?

          Note that I didn’t post this article to discuss Labor’s economic management. And if you can’t discuss Liberal’s economic management and social policies without falling back on the same old party line, “It’s Labor’s fault”, then I’d suggest you take a closer look at the issues.

          Did you bring up jobs for the boys? Probably not a good time to do that, given the recent spate of corruption revelations in the Liberal ranks, or the recent spate of cushy jobs for ex-Libs (Sophie Mirabella, Tim Wilson, Alexander Downer, etc.).

          Re businesses being bled dry and exploited to the benefit of workers: Do you have any verifiable evidence of this?

          Workers do not only exist if there are businesses. Workers exist if there is work. Businesses, on the other hand, exist only if there are workers.

  47. says

    Thanks for this most informative post, Glenn. I found it through Facebook and will be sharing it too.

    It really is shocking to see this list and realize just how far away from being a caring, compassionate society we have become. My hope is that this time will be a wake-up call to many people who have room in their hearts and enough clarity in their minds to change their voting patterns ASAP.

    There is always a choice and I choose freedom, dignity, peace and abundance for all.

  48. Michael Hawes says

    It has got nothing to do with economic facts. It is all about restructuring the economy and society to place more wealth and power into the hands of the 1% and away from the middle classes. Abbott is just trying to catch up to the USA and its policies of the last 30 years. Amazingly enough, even Blind Freddie could see what a disaster that is, but the facts of that have got nothing to do with it either. It’s about ideology. It’s about those who have wealth and power not being required to pay their fair share to support the society that provided their wealth, but being able to keep it all for themselves.

  49. Jamie says

    Glenn,

    Considering I can no longer respond in the same string, I will respond in a new comment.

    The OECD has a better life index which can give you a like-for-like example, on a scale of 1-10 with 10 being better off, of Income (households and wealth), Jobs (Earnings, Job Security and Unemployment) and Health between Australia and three countries which have a lower OECD ‘poverty’ rating than Australia (Czech Republic, Slovenia, Slovak Republic) respectively: A: 4.6/7.7/9.3 CR: 1.6/5.9/5.6 S: 2.2/6.2/6.5 SR: 1.3/4.0/5.1
    http://www.oecdbetterlifeindex.org/

    In terms of Healthcare expenditure as a percentage of GDP, Bloomberg in 2013 did a study on the most efficient healthcare countries in the world with Australia (8.9% healthcare spend to GDP) ranking 7th, comparative to Portugal (10.2%) and the United States (17.7%), both who spend more on healthcare as a % of GDP, ranking 27th and 46th respectively. Bloomberg went as far as noting that “Among advanced economies, the U.S. spends the most on health care on a relative cost basis with the worst outcome”.

    In more relative terms, while this does not identify the purchasing power of each dollar, the USD equivelant per capita spend on healthcare in Australia is $5900 whereas Portugal is $2000.

    http://www.bloomberg.com/visual-data/best-and-worst/most-efficient-health-care-countries

    In terms of jobs lost from the shutdown of car industry, it would be more appropriate to speculate on the net job loss, that is those who cannot find other means of employment. That would be quite low unless these people were incapable of re-entering the workforce either in similar manufacturing based roles (yes, there is still a huge manufacturing industry in Australia) or being re-skilled to enter different jobs,

  50. shane says

    So Why the War….?? – They are operating under the auspices of the U.N charter of Agenda 21 and the Trans Pacific Partnership….. and have no interest in the rest of us. They are precipitating a collapse with the view to precipitating a version of hell on Earth according to their masters wishes. The sad thing is they think they’ve got an exclusive seat on the ship leaving earth little realising they are collateral just like the rest of us. Yet still they persist.
    Pretty soon things are going to change from a consciousness perspective….. they will not be able to control or even predict what is going to happen when the greater populace gets a whiff of what they’ve been missing out on…… more exposure is needed in the moronosphere out there though…..
    Peace.

  51. Michael says

    The only reason they got in was the other side were just that bad. Had they been better there is no way in hell Abbott would have got a chance to do anything.

    Basically who do you vote for, we used to have more parties and more choice, now we just have two and both can easily be controlled by a few rich people, we live in an oligarchy not democracy!

  52. Nathaniel says

    Good article and a question that hasn’t been asked.
    Are are all these things happening?
    Is it because we don’t want to end up like Greece or Spain? Countries much like us that were thrown into riots in the streets and a near revolution?

    Is everything calculated to bring about law and order?
    For example, in Victoria it is illegal to protest. In Queensland there is a war on bikers.

    Without TRYING to sound like a doomsdayer, I believe that they want everything to crash so they can bring in martial law, one currency, track everyone, and make everyone economic slaves.

    Thoughts, please take into account the Normalcy bias.

  53. Alan Austin says

    Great compilation.
    Especially like the fourth chart: the IAREM rankings.
    Thanks for this, Glenn.
    Cheers, AA

  54. Michael says

    Ok, I hate Tony Abbott as much as the next guy, but this entire page is just clutching at straws, blaming Tony Abbott for things that arent his fault.

    Like, yeah hes a dick but he’s been Prime Minister for what, 12 months? How is he responsible for the poverty rate rise of a MASSIVE (sarcasm) 3% since 1995 when he’s been in control for less than 5% of that time?

    And saying “our debt isnt as bad as other countries” is a pretty stupid thing to say. We’re in debt, and I applaud him for trying to fix it. It’s not about “who’s in the least amount of debt”, its about who has a surplus of money they can use to maintain a country.

    FFS. I get you guys hate him but get some perspective.

    • Alan Austin says

      Michael,
      Did you notice that the fourth graph – the IAREM ranking – was published in March 2014?
      It shows Australia has the best-performing economy the world has ever seen.
      Do you agree that there is no ‘budget emergency’ or ‘debt crisis’ in Australia and that the proposed increased taxes on the poor and lower middle are simply to shift wealth and income to the rich?
      Cheers?
      AA

    • says

      Hi Michael. Thanks for your comment. I think you may have misread me, though. I didn’t blame Abbott for the poverty, I cited the poverty rate, and said he’s going to make it worse.

      No, saying “our debt isn’t as bad as other countries” isn’t a stupid thing to say. It provides context against which we can assess the validity of the claim that we’re in a debt crisis.

      Again, I’m not saying I want us to run at a deficit (nor am I saying I don’t – there are schools of economic thought that advocate running at a deficit all the time). What I’m saying is we’re not in a debt crisis, so there’s no need for all the ‘sky is falling’ panic tactics. If we want to rein in spending, fine, let’s do it sensibly. Undercutting our future and targeting our most vulnerable is not sensible. It makes no sense economically, and certainly flies in the face of common sense.

  55. The Economist says

    Glenn I recommend that you get a degree in economics. This may help you get your head around complex issues. I also suggest you prefix your blog with “I hate Tony Abbott.” Just so that we know were you’re bias is as this will prevent people taking your blog seriously.

    • Joanna says

      @The Economist – This is a blog. Blogs by their very nature are the opinions, ideas and notions of the owner of the site.

      From what I can see, the purpose of most blogs is to present the blogger’s opinion and (in this case) to promote an open, rational discussion and debate salient points. If there’s bias then so be it, but that does not diminish the relevance of a shared opinion.

      Further to validity of said opinions, I don’t believe anyone is required to have a degree in their topic of choice in order to share their thoughts and expose them to criticism and an exchange of views. To uphold that particular criteria smacks of elitism and censorship.

      If you don’t like what you read in a blog I’d suggest engaging in the discussion in a less condescending manner, or alternatively close the browser window and move on.

      Disclaimer: My remarks are about blogs in general and not intended as retaliation on Glenn’s behalf. (He’s more than capable of fighting his own battles).

    • says

      Hi The Economist. Thanks for your comment. If there’s a particular complex issue you’d like, please feel free to let me know. Happy to oblige.

      And yes, you’re right, I’m no fan of Abbott. Luckily we don’t have to be a fan of a politician to criticise their policies. If we did, they’d never be criticised at all! :-)

  56. Steve Arico says

    Hi Glenn,

    Fantastic work. You should really make this into a Youtube video to get it out to even more people.

  57. David says

    I’m no fan of Abbott.

    He’s been prime minister for less than 12 months. Labor are still in the Senate. Not much has actually changed since Labor was in government, since no law can be passed without the Senate.

    Your “Poverty Graph” is for 2010.

    When you click on your “Increased the Unemployment Rate” it tells you that; “The number of employed persons in Australia increased to 11553.15 Thousand in March of 2014 from 11535.01 Thousand in February of 2014.”, apparently the highest ever.

    “Suspended the Wage Connect Program” – “Mr Hartsuyker said in the interim, the Coalition would be reviewing the subsidy and looking at ways to improve and ensure the program’s “long-term sustainability”.”
    and each of the other links you supply lead to a very bias statement of facts.

    Graphs on debt is from 2009, and it was going up. What was the 2013 debt graph?

    The list goes on. It’s unfortunate that your facts are tailored to justify your anger to the current government without noting that Labor, while providing many crowd pleasers, spent all the surplus and the Future Fund, and borrowed from other countries and organisations outside Australia to which we are paying interest for. Also, why do we want debt for anyway?

    It is most disappointing that at not one point in our history, did we stop and realise that the cost of production here is not competitive enough for the World stage, and our thirst for consumables at the cheapest price is why other countries are taking away our jobs.

    We are fast running out of GDP.

    I realise you’re trying to say how destructive Abbott is, but he has yet to do something significant. The austerity measures, while no one likes, needs to be done.

    Why would anyone want to live in a country that needs to resolve issues of unemployment, health, infrastructure, and other public services, while paying external parties interest for borrowing money? Do you like owing money to the bank every month for your home? Do you like credit card debt? I would think you would.

    • Joanna says

      “It is most disappointing that at not one point in our history, did we stop and realise that the cost of production here is not competitive enough for the World stage, and our thirst for consumables at the cheapest price is why other countries are taking away our jobs.”

      I don’t think that no one saw this coming. The unions and their unrelenting demands for workers in the manufacturing industries be paid more and more with more and more perks were the start of the rot. But, they were powerful and got their way to a large degree and now the damage is done. This country cannot compete with manufacturing from overseas any more and it’s gone too far to be reigned in.

      The problem is far more to do with the high costs of manufacturing here in comparison with (for example) China, than actual demand and a reluctance to buy anything that isn’t ‘cheap’.

      What concerns me right now more than the loss of manufacturing is the lack of actual alternatives and direction for what will replace this in terms of jobs and industries for the future of this country.

    • says

      Thanks for your comment David. I’ve used most recent graphs I could find. If you’ve tracked down anything more recent, I’m more than happy to look at it.

      Re the debt graph, I’ve already answered that question here: http://www.glennmurray.com.au/abbotts-war-on-the-rest-of-us-and-why-theres-no-need/#comment-3190

      The poverty graph is from the OECD’s 2014 ‘Society at a Glance’ report. I assumed it was the latest they had available. Indeed, despite searching, I haven’t found anything more recent.

      Re the unemployment figures, you’ve obviously misread the intro to that page. It says:

      “The number of employed persons in Australia increased to 11553.15 Thousand in March of 2014 from 11535.01 Thousand in February of 2014. Employed Persons in Australia is reported by the Australian Bureau of Statistics. Employed Persons in Australia averaged 8536.17 Thousand from 1978 until 2014, reaching an all time high of 11663.42 Thousand in June of 2013 and a record low of 5997.60 Thousand in September of 1978.” http://www.tradingeconomics.com/australia/employed-persons

      You’ll also note the big drop at the end of 2013… right around the time of the election.

      In fairness, as I’ve said elsewhere in these comments, there are obviously a lot of factors contributing to short-term fluctuations in unemployment, so I don’t blame Tony for this particular drop. I do, however, blame him for the big drop we’ll see when the auto industry leaves… ;-(

      Suspended Wage Connect Program… Not sure what your point is here?

      Other cuts… Please let me know in what way my links lead to biased articles.

      I didn’t mention Rudd’s borrowing because I don’t know much about it. Do you?

      I didn’t say we want debt, I said we don’t have a debt crisis.

      Re the cost of our production in Australia, surely you can’t think it’s the unions’ fault?! The cost of living in Australia is far higher than it is in the developing countries we lose production to. Do you want our labour force to live in abject poverty just so we can compete with them?

      Please provide verifiable evidence of your claim that we’re fast running out of GDP.

      Please also provide some verifiable evidence of your claim that austerity measures are necessary. You haven’t offered any evidence of anything in your comment. You’ve merely expressed an opinion and pointed out that couple of my graphs are out of date.

      • Joanna says

        To be fair to David,

        “Re the cost of our production in Australia, surely you can’t think it’s the unions’ fault?! The cost of living in Australia is far higher than it is in the developing countries we lose production to. Do you want our labour force to live in abject poverty just so we can compete with them?”

        The comment about the unions was mine, not his.

        To answer your questions, I don’t think there’s any doubt that the unions played a large part in levels of remuneration, particularly in manufacturing. I have been a worker and member of a union, I have been a business owner and employer and I have also dealt with union representatives within a conciliation process so I have experience with them on a few fronts.

        They are not renowned for their ability to negotiate reasonably nor consider the possible ramifications of their actions. Whereas they were successful in securing wage increases, the result of this was often staff cuts. So some of their members received more money in their pocket at the end of the working week whilst others lost their jobs. This was just one more immediate result, the longer term prospect that pushing wages up might just end the business altogether and put a lot of their members on the unemployment line also did not factor in to their thinking.

        Obviously the unions cannot be blamed for the whole range of issues that have undermined our manufacturing industry however, they have had some impact by their actions.

        But as in politics, there’s nothing to be gained by wasting time chewing over the history of it, bemoaning the loss and allocating blame. It’s happened and you cannot turn back time.

        And no, I would not expect anyone to live in abject poverty just so our manufacturing industry could continue. My whole point has been that manufacturing is all but lost to us. Expecting the government to financially prop up an ailing industry is unreasonable and pointless. We need to look to the future and identify what industries are available to us that will keep our economy strong and start building towards that.

        • says

          Hi Joanna. Sorry, losing track! ;-P

          Thanks for the clarification. I agree that unions have played a part in increasing wages. That’s a big part of their role, after all. But I bet if we looked at the figures, union-represented worker wages haven’t increased at rates far out of line with other workers. The earlier claim that unions are responsible for Australia’s high wages (compared to developing nations) is simply ludicrous.

          I also disagree that it’s a waste of time chewing over the history of it. And it’s certainly not a waste of time to correct patent factual inaccuracies like the above, which perpetuate negative, unhelpful stereotypes about unions.

          I do, however, agree that we need to look to the future. Which is, in fact, one of the big reasons for this post. Abbott is actively undermining our future. Science, education, research, health, welfare. We need all of these components of our society functioning well, not scrambling for funds and undercut at every turn.

          • Ian Kearns says

            If you take Unions away, workers rights will disapear overnight. They provide a voice for the working people when arbitration fails. Big business have lawyers aplenty, the lowly worker would have no chance against a large corporation without support from a union.
            Those against unions are mostly middle management who believe all the BS they are fed from management. Without Unions the worker would become a slave.

  58. concerned expat can't afford to come home says

    Thanks for posting. Regardless of the many comments both positive and negative, I think you have demonstrated Australia’s position in the world in a way that most will or can comprehend. I have shared your article with great pleasure.
    Living overseas in a developing country, watching from the sidelines, I feel the reality of repatriating creeping further away. I desperately want to come home but I can’t afford to live in my own country. Sad eh?

  59. Sarah says

    Start-up Scholarships haven’t actually become loans.. Yet. The article it links to is 5 months old and the bill was never actually passed. But I wouldn’t put it past them to just forget about it! A lot of the information here is out of date and as much as I too dislike Abbott, the argument has to be justified with recent stats to really be valid.

    • says

      Hi Sarah. Thanks for the correction. I wasn’t aware of that one. I saw that the bill had passed, but didn’t notice that the scholarships element of it had been removed on the way through. Fixed now.

      You mentioned that a lot of the information in the post is out of date. Which information do you mean? As far as I know, it’s all as up-to-date as I can find. But if I’m wrong, I definitely want to know.

  60. Chris says

    its so easy to blame abbott or rudd or gillard or howard and on and on ….politicians world wide know the general masses have become lazy , in time we accept what they lay down as reality … we live in our little worlds , concerned only for our immediate circle , we are selfish in our long term planning and could not give a shit unless it really affects us personally …even then it must be a big enough shock to disrupt our own personal survival ….i bet the the people of Syria , Ukraine , Venezuela wished they had stood up long long before it turned into war … will we react at the last minute ? when its too late ? time to get off the keyboards and walk the walk ,,,, easy to blame not so easy to make a stand … i did ,i left in 2008 disgusted with the path the lucky country was taking , if anything the pace has increased on the path to a elite zombie nation ….to quote the Boss ….if theres a light brother i dont know , i will meet u further on up the road ….

    • says

      Thanks for your comment, Chris. I agree that many Australians are apathetic and complacent. I hope we, as a country, respond to these threats in time. I also agree we need to fight it. But it sounds to me like you’re saying talking about the issue, raising awareness about it, should be abandoned in favour of some other sort of action. Many of us (me included) are doing a lot more than simply writing about these problems. But even if some of us were only writing, I believe that would be absolutely fine. Awareness is critical. Without it, there’d be no action of any sort.

  61. Ian Kearns says

    I compared some of these figures with which government was in power and it is clear that Liberal governments do bring our overseas debt down and labour governments do spend more, but so what? When Labour governments are in power people are in work, if people are in work they spend money which means businesses prosper and the economy prospers. In the current economy the Liberal party will squirrel money away and pay off our debts but the economy will suffer and unemployment will rise. Surely that is a scenario no one wants. Jobs are already dissapearing, I think Labour for all their shortcomings and infighting did a reasonable job during a worldwide recession. Those that voted Liberal may very well rue there vote in 3 years time.

    • says

      Definitely true. I think everyone’s (once again) gotten carried away with the left vs right, Liberal vs Labor argument. The point of this post is that there’s no debt crisis. Sure, Labor created a deficit, and historically, Liberal reduces the deficit. But it’s simplistic and futile to assign value judgements to those actions without looking at the context and the long term effects.

  62. Gio says

    While graphs make some very pretty pictures, I do have to question how this data is presented.

    As an example, let’s look at the graph of Net debt to GDP.

    The author states:

    “(Unfortunately, I haven’t been able to find a more recent graph. Australia’s debt has increased since 2009 from about 9% to 11.7%. But during the same period, the OECD average has increased from 52% to around 70%! According to Wikipedia’s summary of IMF figures, we’re ranked 11 out of 34 OECD countries.)”

    Wow we must be doing great!! Australia’s debt has increased only 2.7% whereas the OECD average is 52% to 70%. But hang on… a 2.7% increase on 9% is about a 30% relative rise.. the OECD average is 34%

    I wouldn’t call a 30% rise in debt “not spiraling out of control” …

    • says

      Hi Gio. Thanks for your comment. That’s a good point. Unfortunately, I’ve just updated the graph to 2010 figures, and I don’t know the OECD average from 2010. Given the higher relative increase over 2 years, I suspect our relative increase over the second year alone would also be higher.

      Of course, a greater-than-OECD-average relative increase over a 1 or 2 year period isn’t really a crisis either… 😉 As you can see from the debt trend graph, this would have happened numerous times in the last 30 years.

      • Gio says

        Thanks for the reply Glenn,

        My comment was a little rushed, as this article was drawn to my attention between serving customers lol..

        It really is a thought provoking piece, but I’ve always been wary of the presentation of statistical data, hence the direction of my comment (not just regarding this, I was a scientist in an earlier career, and took some data as gospel once that wasn’t.. and I’m no longer in science hahaha)

  63. Tina says

    I see the amount of money spent on Gambling, the Fat people and their shopping, the loss of services in the Community, desperate people stealing someone’s Groceries, so many new cars on the road, long w’ends camping, new Bridges being built, Tunnels being built, new Housing Estates. etc- where’s the problem ? we are doing OK in this country.

  64. Isaac Laker says

    Brilliant article, I agree completely except with the very start- Point #1. It’s rather facile to state that “there’s only one person to blame for the 50,000-90,000 jobs that will go when we lose our automotive industry” rather, the entire manufacturing sector is, and has been for a decade at least, unable to compete internationally as it is comparatively uncompetitive. It is far more accurate to state that there is only one party to blame for those who will be unemployed will be rendered structurally unemployed as the government will be too stingy to spend any money to reeducate these people to be reallocated to sectors in which we are comparatively competitive, which, ironically, would actually contribute to the economy rather than weighing on it through demand for unemployment benefits. Brilliant article any way, I have no clue how any university could ever have given Abbott a degree in Econ.

  65. DanofMelb says

    Hi Glenn – thankyou for compiling this data – A recent report by Anglicare into poverty found:

    “ANGLICARE Sydney’s Rental Affordability Snapshot analysed 12,164 properties that were available in Greater Sydney on the weekend of 5-6 April 2014. Of the 12,164 properties advertised, only 33 were affordable and appropriate for households on income support payments without placing them into rental stress.”

    http://www.anglicare.org.au/news-research-events/latest-news/2014-rental-affordability-snapshot

    So whilst the meta economics are far better than we are being told – housing is not getting the attention it needs.
    If only 33 out of 12,164 properties are affordable for pensioners then I am genuinely stunned – I knew it was bad but not this bad.
    Keep up the analysis and rapport.

  66. J Howard says

    This is from the ANU : The Australian National University , so hopefully the left wing twats on this site will read the facts …… The base in which the Liberals left the country in were wrecked by the Rudd/Gillard loonies…… Basically Labor wrecked the country & now the Libs have to fix it & all the left wing commie greens are crying about it …..Are you serious …. I always get riled by Labor when they are in power as history will tell you the Libs always come in to FIX Labors debts …..

    Rudd took office in 2007 with net government saving of almost $45 billion and left office in June 2010 with an estimated net debt of almost $42 billion—forecast to increase to almost $94 billion by 2012, with annual interest repayments of more than $6 billion.

    One of the most controversial programs was the disastrous $2.4 billion home insulation, or ‘pink batts’, program, which paid a rebate of $1200 a home for the cost of home insulation. Overseen by the then Minister for the Environment, Heritage and the Arts, Peter Garrett, the program aimed to create jobs and to insulate more than two million homes. Serious breaches of safety, however, due to rushed jobs by poorly trained installers, led to four deaths, a number of injuries, 120 house fires and more than 200 000 homes with faulty or poorly fitted insulation (The Australian 2010a). The Rudd government was criticised for not acting sooner given the many warning letters from businesses within the insulation industry and from state governments regarding the lack of monitoring of workers’ qualifications and safety standards. The program began in July 2009 and was axed in February 2010. It was then followed by a long safety inspection program for homes fitted with foil insulation—at an estimated cost of about $1 billion (The Australian 2010a).

    The Building the Education Revolution (BER) ‘school halls’ program was another major component of the Labor government’s stimulus policies, implemented by the then Minister for Education, Julia Gillard. It aimed to provide rapid construction of multi-purpose halls and libraries to stimulate the building industry while at the same time providing improved facilities for schools. The largest component of this policy was $12.4 billion of capital works in primary schools, which became $14.1 billion due to cost increases of $1.7 billion (ANAO 2010). The scheme became the subject of significant criticism with claims of rorts and hugely inflated building prices. It was argued by some schools that the scheme lacked flexibility and that they were receiving buildings they did not need. The involvement of state and territory government administration added much to costs, managing contractors were charging more than three times the usual fee, the time frame for construction completion was too short, and some local builders were greatly inflating prices (The Australian 2010b). For example, in March 2010, lobbying by a school principal led the NSW state government to finally reverse a decision to spend $1 million on a shade-cloth structure (originally quoted as costing $400 000), which was valued at market prices at only $250 000 (The Australian 2010b). In Parramatta, a school hall was built in a private school for $170 000, and in a BER-funded public school a similar hall was built for $350 000. In 2009 and 2010 in Queensland, more than 20 per cent of the BER was being absorbed in administration costs (The Australian 2010b). The widespread extent of the apparent price gouging led to audits commencing in 2010, conducted by state governments and the Australian National Audit Office (ANAO). As the BER program was scheduled to run until 2012, serious concerns began to arise that the waste was going to be even greater than in the insulation program. Following much public outcry, in May 2010, Julia Gillard set up the government’s own task force to investigate formal claims of waste and rorting in the BER. There were, however, also accusations of waste even within the task force, with more than $1 million spent on consultants within the first two months, and a total budget allocation for the task force of $14 million (ABC 2010b). An additional problem emerged with the sudden and large demand for building materials and labour for the BER flowing through to higher prices in non-school construction, and increasing costs in other industries.

    Many schools, however, reported that the building programs were useful, and formal complaints were made by about only 3 per cent of schools (Australian Government 2010a). The building industry also received a boost in profits and employment. The key question is whether or not the BER represented value for money, and whether the stimulus effects justified the waste and government debt. This is, of course, the same question facing the entire Nation Building program. Economists and analysts generally acknowledge that some stimulus was required to help shield Australia from the effects of the GFC, and that the speed of the Rudd government’s policy response was instrumental in its early impact on the economy. The debate centres on whether the size of the economic stimulus was appropriate or too big, the way in which the funds were used, the size of the ensuing government debt, and on whether the stimulus measures should have been wound back faster once economic growth returned to healthy levels.

    • says

      Thanks for your comment, J. Personally I think the whole left vs right thing is counterproductive. I prefer to just discuss the issues and the facts. When you label yourself one or the other, cognitive dissonance will incline you to accepting suggestions, facts and policies only from that side, and rejecting suggestions, facts and policies from the other.

      Also, I think you’ve misunderstood virtually everyone who’s commented here. I’m certainly not advocating communism. A more tightly regulated capitalist democracy is fine by me. I get the impression that most others who’ve commented here would say the same.

      But that’s an aside.

      To your point: There’s no doubt Rudd and Labor screwed a few things up. Personally, I think they screwed a lot of things up, and in most things they’re little better than Liberal.

      There’s also no question about the facts. We know what Rudd inherited, and we know what he left us with, dollar-wise. I’m certainly not going to contest that element of the ANU piece you cited (do you have a link for that BTW?). However, you’ve presented that piece as “the facts”, implying that everything it’s asserting is fact. The figures may be facts, but the interpretation of those figures is not.

      Economics is a complex discipline. The author of your piece obviously believes his/her interpretation of the facts is correct. But not all economists do.

      Take Joseph Stiglitz, for example. He’s a Nobel Prize laureate, a Professor at New York’s Columbia University, and a former World Bank chief economist and economic adviser to the US government. He believes exactly the opposite to what the ANU author asserted. http://www.abc.net.au/news/2010-08-06/stimulus-served-australia-well-despite-waste/935002

      In any event, we’re once again deviating from the point of this post. The point is we don’t have a debt crisis on our hands, we merely have an economic reality to deal with. We have an aging population, we have people who can’t work or can’t find work, we all need the health system, we’re running out of coal, our labour costs are too high for most simple Australian manufacturing to be competitive.

      We can’t just leave ignore those people who need support. That’s makes bad economic sense (not to mention unethical). We can’t just ignore the fact that we’re running out of coal, and not invest in alternatives for powering our nation. And we can’t just insist on third-world wages in Australia, because Australia has first-world living costs.

      Those are the economic and social realities. Any sensible social and economic policy must work around those realities, not blindly attempt to plow through them as if they don’t exist.

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