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a low wage Australia? « Previous | |Next »
December 3, 2005

I didn't watch the Senate debating the IR legislation yesterday but I can imagine there would have been angry scenes given the time limit. So the two key planks of the Howard Government's 4th term neo-liberal agenda that entrenches the culture of entrepreneurship and individual initiative are in place.

The Parliamentary debate is over.

Judi Moylan, who declared support for the Government's goal of reducing welfare dependency, asked a good question:

"Why are we including in this policy disincentives to work and cuts in income support which can only drive some of the more vulnerable in our community deeper into poverty?"

Why indeed.

The Prime Minister also asks a good question when he rhetorically asks:' Why would any Australian PM create a low wage Australia?'
Why indeed.

But put the welfare-to-work and the IR legislation together in the context of a global economy, a shortage of workers and user pays education, and that low wage future is what the scenario looks like for the low skilled. The justification for the IR legislation? Any job is better than no job. Prosperity is fairness.

It may well be the case that a strong economy is the only guarantee of job security and future higher real wages. So what happens in a downturn with a flexible labour market when businesses are cutting costs? It is the families who will act as the safety net for the most vulnerable Australians.

Meanwhile, taxation looms as a policy issue for 1996::

Alan Moir

Why not tax cuts for rich and poor? Why not a fairer tax system? The current one savagely penalize those making the transition from welfare to work and stifles their entrepreneurship and individual initiative.

| Posted by Gary Sauer-Thompson at 10:30 AM | | Comments (2)


Perfect timing from the libs, and perfect timing from the electorate to give them the opportunity to do this at the top of a prolonged boom in the Australian Economy.
However, the boom will not last forever, no booms do, and when the economy stalls this time it could be very nasty. It seems that a prime driver of the boom has been the willingness of Australian households to increase their debt loadings...particularly through asset price inflation. There are plenty of signs out there that this is unsustainable...the ongoing problems with the CAD at a time when resource prices and $ are very strong, and the recent OECD analysis of house prices in Oz for example. This process has seen a large amount of the risk inherent in our version of the deregulated economy taken up by householders as it has been shed from government and banks. I use householders deliberately as they are, in my view the most exposed. The latest shift in who will bear the risk is the IR legislation and the process has been the same, moving risk from those who can most afford to bear it, to those that cannot. Personally I do not consider those living in poverty to be at the most many of them have lacked the means to truly overexpose themselves. I think the real bite will be on the middle income belt during the next economic downturn. The key to who suffers most will not be how much they are paid, but rather what level of discretionary income they have.

good analysis of the middle class situation.

The Age has an article on the poor get poorer For the working class

....employment growth will mostly be in the jobs the working poor now have: child and aged-care, cleaning, retail and call-centre work, hospitality---jobs associated with the life-style changes of the dual-income affluent classes in the West.

I guess the life is one of worsening work conditions, a struggle to pay the bills, medical care costs and credit card payments; with little chance of saving money of getting better jobs with some educational qualifications.