- Joined
- 14 February 2005
- Posts
- 15,298
- Reactions
- 17,527
The problem with all this investment stuff is really about constant changing of the rules.
An entire generation had it drummed into them very thoroughly and that was by a Labor government at the time and subsequent Liberal governments did the same.
"To plan for your retirement think of superannuation"
Complete with saturation TV advertising that ran for years using those exact words, seminars in workplaces both government and private enterprise and so on.
Plus whilst it was never said that the Age Pension would be outright abolished it was very strongly implied even in some of the official government promotion of superannuation, that you sure wouldn't want to be relying on the pension and that you really had to be investing.
Now most ordinary people have limited knowledge on any given subject and that goes for anything. How many people here can confidently assess the structure of a house, and the electrical wiring and plumbing, and do the conveyancing themselves, also have a pilot's licence and are good at playing drums? Not many - most people understand the basics of most things but they lack any detailed knowledge and it's the same with investing.
Prior to all this the share market was primarily seen as something that interested rich people and if you'd asked the average Australian about shares, well they'd have known that you could buy shares in BHP and that's about it, that's about the only listed company most could have named with confidence off the top of their head indeed it's still among the first listed companies that most would think of today.
Beyond that, well most of those with some money to invest had put it in term deposits, which used to pay pretty decent rates of interest. Or they'd done things like investing in bonds issued by the state-owned utilities on the basis that they couldn't possibly go broke, most of them had credit ratings better than government itself, plus it was the "right" thing to be doing by investing your money to build infrastructure the country needed wasn't it?
All this idea of owning shares in companies that most had never heard of was a new thing for most. But backed with extensive government advertising, workplace seminars and assurances from the likes of banks, who were still held in reasonably high regard at the time, that this really was the right thing to be doing the masses went forth and did so.
A few years later and we had the Treasurer proudly proclaiming that more than 50% of Australians now owned shares. This was all a good thing, right?
Now in considering all this it has to be remembered, and this was a point that frequently needed explaining to ordinary people, that superannuation is not itself an investment. It is for practical purposes a tax reduction on investing subject to various rules but it is not an investment of itself.
For those with investments outside of superannuation, well they've already foregone that tax reduction in order to also avoid the rules, primarily the rules about the preservation age which obviously fails those who want or especially need to retire earlier.
Considering that backdrop it's not hard to see why many will be outright furious about any changes in the rules which disadvantage them at this stage. If you go to great lengths to persuade people to do something, and then once they've done it change the rules to disadvantage them, well the term "scam" comes to mind and that tends to make people rather angry.
Which brings to mind another one of Labor's policies. Electric vehicles.
It's a great idea and you won't find too many people keener than me on the idea of electric transport. Or electric anything for that matter.
Those who are old enough will be a tad wary however and they've seen this one before.
Heat your house with oil they said. OK, sounds good all nice and easy and pretty soon every new house was built with oil heating and lots of people installed an oil-fired heater into their existing fireplace with a 100 Gallon tank outside. Then they jacked the price of oil up, literally tripled it in one fell swoop, and lots of people were left shivering with heaters they couldn't afford to run.
LPG was another one. Lots of encouragement to convert cars to run on LPG and lots of investment in putting the pumps in at service stations and so on. Then they put a tax on it, put the price up and the industry's pretty much dead now. Those who converted, or worse still bought an LPG-only vehicle, are left with the problem.
More recently natural gas for household use has gone the same way. Relentlessly promoted by government, in Victoria to the point that it's rather difficult to legally build a new house without installing gas, then once most people are using it the price has been seriously jacked up.
Off-peak electricity in some states much the same. Heavily promoted, was cheap, then once people are using it the price went through the roof.
Spotting a pattern here? Get people to change from one fuel to another and then make the new one seriously expensive. Been done a few times now so whilst I'm a supporter of EV's in principle I most certainly do understand why many are wary.
Go forward 5 years and "EV drivers aren't paying any tax!" the politicians will scream. Just like those investors not paying any tax or before them those with LPG cars who also also weren't paying tax because they did exactly what government encouraged them to do. This all sounds rather familiar.....
Which brings me to the real overall point - the masses have had enough of being duped by governments who don't appear to be acting in the best interests of the mainstream. That's where the real anger lies so far as I can tell. Too many "changing the rules" things like the examples I've given. Too much sitting back whilst factories close and put people out of work, wages fall behind living costs and so on and all we hear is lightweight stuff about looking into things or telling people to shop around for the best deal.
The idea of governments actually working for the majority seems anathema to the current generation of politicians. Look at events overseas and the same frustration is becoming apparent - Americans who voted for Trump because they were sick of seeing the middle class falling behind and he was at least different to the status quo. Britons who wanted out of the EU which seems more worried about practically anything other than improving the lives or ordinary people. And so on, it's a trend not unique to Australia.
An entire generation had it drummed into them very thoroughly and that was by a Labor government at the time and subsequent Liberal governments did the same.
"To plan for your retirement think of superannuation"
Complete with saturation TV advertising that ran for years using those exact words, seminars in workplaces both government and private enterprise and so on.
Plus whilst it was never said that the Age Pension would be outright abolished it was very strongly implied even in some of the official government promotion of superannuation, that you sure wouldn't want to be relying on the pension and that you really had to be investing.
Now most ordinary people have limited knowledge on any given subject and that goes for anything. How many people here can confidently assess the structure of a house, and the electrical wiring and plumbing, and do the conveyancing themselves, also have a pilot's licence and are good at playing drums? Not many - most people understand the basics of most things but they lack any detailed knowledge and it's the same with investing.
Prior to all this the share market was primarily seen as something that interested rich people and if you'd asked the average Australian about shares, well they'd have known that you could buy shares in BHP and that's about it, that's about the only listed company most could have named with confidence off the top of their head indeed it's still among the first listed companies that most would think of today.
Beyond that, well most of those with some money to invest had put it in term deposits, which used to pay pretty decent rates of interest. Or they'd done things like investing in bonds issued by the state-owned utilities on the basis that they couldn't possibly go broke, most of them had credit ratings better than government itself, plus it was the "right" thing to be doing by investing your money to build infrastructure the country needed wasn't it?
All this idea of owning shares in companies that most had never heard of was a new thing for most. But backed with extensive government advertising, workplace seminars and assurances from the likes of banks, who were still held in reasonably high regard at the time, that this really was the right thing to be doing the masses went forth and did so.
A few years later and we had the Treasurer proudly proclaiming that more than 50% of Australians now owned shares. This was all a good thing, right?
Now in considering all this it has to be remembered, and this was a point that frequently needed explaining to ordinary people, that superannuation is not itself an investment. It is for practical purposes a tax reduction on investing subject to various rules but it is not an investment of itself.
For those with investments outside of superannuation, well they've already foregone that tax reduction in order to also avoid the rules, primarily the rules about the preservation age which obviously fails those who want or especially need to retire earlier.
Considering that backdrop it's not hard to see why many will be outright furious about any changes in the rules which disadvantage them at this stage. If you go to great lengths to persuade people to do something, and then once they've done it change the rules to disadvantage them, well the term "scam" comes to mind and that tends to make people rather angry.
Which brings to mind another one of Labor's policies. Electric vehicles.
It's a great idea and you won't find too many people keener than me on the idea of electric transport. Or electric anything for that matter.
Those who are old enough will be a tad wary however and they've seen this one before.
Heat your house with oil they said. OK, sounds good all nice and easy and pretty soon every new house was built with oil heating and lots of people installed an oil-fired heater into their existing fireplace with a 100 Gallon tank outside. Then they jacked the price of oil up, literally tripled it in one fell swoop, and lots of people were left shivering with heaters they couldn't afford to run.
LPG was another one. Lots of encouragement to convert cars to run on LPG and lots of investment in putting the pumps in at service stations and so on. Then they put a tax on it, put the price up and the industry's pretty much dead now. Those who converted, or worse still bought an LPG-only vehicle, are left with the problem.
More recently natural gas for household use has gone the same way. Relentlessly promoted by government, in Victoria to the point that it's rather difficult to legally build a new house without installing gas, then once most people are using it the price has been seriously jacked up.
Off-peak electricity in some states much the same. Heavily promoted, was cheap, then once people are using it the price went through the roof.
Spotting a pattern here? Get people to change from one fuel to another and then make the new one seriously expensive. Been done a few times now so whilst I'm a supporter of EV's in principle I most certainly do understand why many are wary.
Go forward 5 years and "EV drivers aren't paying any tax!" the politicians will scream. Just like those investors not paying any tax or before them those with LPG cars who also also weren't paying tax because they did exactly what government encouraged them to do. This all sounds rather familiar.....
Which brings me to the real overall point - the masses have had enough of being duped by governments who don't appear to be acting in the best interests of the mainstream. That's where the real anger lies so far as I can tell. Too many "changing the rules" things like the examples I've given. Too much sitting back whilst factories close and put people out of work, wages fall behind living costs and so on and all we hear is lightweight stuff about looking into things or telling people to shop around for the best deal.
The idea of governments actually working for the majority seems anathema to the current generation of politicians. Look at events overseas and the same frustration is becoming apparent - Americans who voted for Trump because they were sick of seeing the middle class falling behind and he was at least different to the status quo. Britons who wanted out of the EU which seems more worried about practically anything other than improving the lives or ordinary people. And so on, it's a trend not unique to Australia.
.
