National poverty - The new normal?

[moXJO]

Much the same with the Liberals at least at a state level (and not just in one state but most).

Get rid of however many public servants and replace them with contractors, often the exact same people, at several times the cost and with the cost of administering the contracts on top. Seen that one play out many times.

Neither party gives a damn about spending taxpayer's funds efficiently. All that differs is who the beneficiaries are.

Labor state is disastrous for me. Labor fed means I'm jumping on board whatever schemes they are pumping out. First in best dressed and they usually cut the scheme due to blowouts.
For me, fed libs are tightwads. I'm sure they are splashing cash, just not as easy to get into for my line of work.
Lib nsw has been pretty good so far.

 

[MrBurns]

The scene was way better back in 1975, 5 times wages would buy you a house now 5 times wages buys you bugger all.

Across Australia's capital cities in 1976, median house prices looked like this*:
Sydney – $36,800.
Canberra – $35,100.
Melbourne – $32,900.
Adelaide – $29,800.
Hobart – $31,575.
Perth – $33,000.
Brisbane – $26,275.

The average full time earnings in 1975 was $7,600 per year,

Now - Average Australian Yearly Earnings: $70,000 approx

 

[luutzu]

The scene was way better back in 1975, 5 times wages would buy you a house now 5 times wages buys you bugger all.

Across Australia's capital cities in 1976, median house prices looked like this*:
Sydney – $36,800.
Canberra – $35,100.
Melbourne – $32,900.
Adelaide – $29,800.
Hobart – $31,575.
Perth – $33,000.
Brisbane – $26,275.

The average full time earnings in 1975 was $7,600 per year,

Now - Average Australian Yearly Earnings: $70,000 approx

Average houses in Sydney about $800k to $1.2m now? That's just nuts.

Even at 4/5% interest, a 1 million mortgage will just eat up all that average pay like you don't earn anything.

 

[Value Collector]

Which means that governments are going to have to start taxing capital more because they simply won't get the revenue from employees that they did in the past.

Bill Gates suggested taxing machines and software which are the real money earners these days, and that sounds like a good idea.

Investors are already paying taxes on the income their capital earns.

 

[Value Collector]

Average houses in Sydney about $800k to $1.2m now? That's just nuts.

Even at 4/5% interest, a 1 million mortgage will just eat up all that average pay like you don't earn anything.

It's a story of density.

in 1975 it might have been possible for the average Sydney sider to buy a quarter acre block with a house on it.

As density increases and population doubles, it is not going to be possible due to lack of land within the target area.

So density needs to increase, which means the price land will increase faster than the average wage because.

1, developers out bid home owners and knock the house down to rebuild apartments.

2, Home owners bidding for the remaining houses and land bid up the prices.

 

[luutzu]

If in the year 2000 you earn $100 and I earn $200,

Then over 10 years our wages double, so you earn $200 and I $400, I guess you can argue that the rich is getting richer, and there is in equality because your wage increased $100 and mine increased $200, but the fact is we both are better off.

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But yes, unskilled workers are going to find it harder to make ends meet, because the value of unskilled labour is dropping, while the value of skilled labour is rising, and also the value of capital is rising, because more and more capital is replacing unskilled labour.

But the gap didn't change at all in that example of yours. 2/1 = 4/2 = 2

I think most people, poor people, are not at all envious of the rich or care about the wealth gap. Just as long as they see themselves working hard and able to put roof over their family, food on the table, weekends at the park or some family outing... and maybe a holiday once in a while.

I don't think that's asking for too much. And what's more, it's better for both society and the economy if that is possible.

But policies has been steered towards favouring those with money, leaving those with little to go without. That's when it'll slowly decay and could lead to social unrest.

 

[luutzu]

It's a story of density.

in 1975 it might have been possible for the average Sydney sider to buy a quarter acre block with a house on it.

As density increases and population doubles, it is not going to be possible due to lack of land within the target area.

So density needs to increase, which means the price land will increase faster than the average wage because.

1, developers out bid home owners and knock the house down to rebuild apartments.

2, Home owners bidding for the remaining houses and land bid up the prices.

That's only true in some parts of Australia, and only in some parts of those parts of Australia... like houses near train stations, hospitals, local CBDs etc.

Move away, say, even 500m away, from those pockets of density requirement and there's not much demand for flats or high rises.

Australia is in a massive property bubble, fueled by massive personal debt and irresponsible monetary/public policies. It has never ended well when these mix happen... not in the US, not Ireland, not Spain.

 

[MrBurns]

That's only true in some parts of Australia, and only in some parts of those parts of Australia... like houses near train stations, hospitals, local CBDs etc.

Move away, say, even 500m away, from those pockets of density requirement and there's not much demand for flats or high rises.

Australia is in a massive property bubble, fueled by massive personal debt and irresponsible monetary/public policies. It has never ended well when these mix happen... not in the US, not Ireland, not Spain.

Thats right, incompetent Government immigration policy into the bargain, Melbourne is way overpopulated and is becoming third world. Dirty money from China has pushed property prices further out of reach of locals, many of the properties are vacant, just to get the money out of China.
Local hairdresser is regularly asked if he wants to take on apprentices he declines and they say there's no need to pay them just do the paperwork and we'll pay you...this is to prove residency to help with immigration, AND a woman who runs a B&B just told me that she gets lots of booking from Chinese but they never proceed and pay a deposit this also is to satisfy and show some evidence of residency.
Australia is a joke the people raping our country can't believe their luck.

 

[SirRumpole]

Investors are already paying taxes on the income their capital earns.

The average Joe is getting taxed on both their incomes and spending, so your point is ?

If companies replace workers who pay tax with machines who don't pay tax it seems obvious that the government has to recoup that money somehow and taxing machines is one way to do it.

 

[Value Collector]

But the gap didn't change at all in that example of yours. 2/1 = 4/2 = 2

I think most people, poor people, are not at all envious of the rich or care about the wealth gap. Just as long as they see themselves working hard and able to put roof over their family, food on the table, weekends at the park or some family outing... and maybe a holiday once in a while.

I don't think that's asking for too much. And what's more, it's better for both society and the economy if that is possible.

But policies has been steered towards favouring those with money, leaving those with little to go without. That's when it'll slowly decay and could lead to social unrest.

My point is that what you call poor (in Australia) is pretty well off, and consumes a lot more goods and services than the poor did in the past.

 

[Value Collector]

Move away, say, even 500m away, from those pockets of density requirement and there's not much demand for flats or high rises.
.

after the houses are bulldozed, you have a greater number of people bidding up those remaining houses.

 

[MrBurns]

My point is that what you call poor (in Australia) is pretty wealth off, and consumes a lot more goods and services than the poor did in the past.

Yes and in the past we didn't have a lot of things but that doesn't change the fact that the poor are poorer in relative terms now than ever and it also now involves our youth that have no hope of ever purchasing a home in their own city without an inheritance.

 

[Value Collector]

The average Joe is getting taxed on both their incomes and spending, so your point is ?

If companies replace workers who pay tax with machines who don't pay tax it seems obvious that the government has to recoup that money somehow and taxing machines is one way to do it.

It's "average Joes" that own the capital. e.g. every day investors like me, self funded retirees, etc.

Any increase in company profit generated by higher utilisation of machines, will increase that companies taxable income, and then the owners will pay tax on their dividends and capital gains when the profits are past along to them.

Not to mention that more productive machines normally translate to higher wages for the remaining employees.

e.g An operator of this

earns more than the operator of this.

 

[Value Collector]

Yes and in the past we didn't have a lot of things but that doesn't change the fact that the poor are poorer in relative terms now than ever .

How can that be??

The only way to measure that is to compare the amount of products and services consumed now vs then, and the average person consumes a lot more stuff now.

Things that even the poor take for granted now the rich couldn't have had in their wildest dreams years ago.

 

[SirRumpole]

e.g An operator of this

earns more than the operator of this.

Sure, but there are less operators of the machines to pay tax so the government loses revenue which has to be recouped somehow, and I don't think it's all being recovered in extra company tax being paid.

 

[Value Collector]

Sure, but there are less operators of the machines to pay tax so the government loses revenue which has to be recouped somehow, and I don't think it's all being recovered in extra company tax being paid.

yeah but tax is paid on the total productivity of the business, how that is divided up between labour and capital in irrelevant.

if a $1 is paid to a worker, he will pay tax

if an extra $1 is retained as profit at the company it will pay tax, the investor will also pay tax when that $1 makes it to his pocket.

either way tax is being paid.

 

[McLovin]

The scene was way better back in 1975, 5 times wages would buy you a house now 5 times wages buys you bugger all.

The problem with a crude measure like that is ignores heaps of variables to the point that it is almost meaningless. Two income households, higher wages meaning less spending as a % on necessities like food and clothing, to give two examples.

The ABS Household Expenditure Survey will break it down for you, but I think it doesn't go all the way back to 1975.

Did people pay 5x AWOTE because housing was so affordable, or was it 5x AWOTE because that's all they could afford?

 

[SirRumpole]

either way tax is being paid.

What matters is the total tax recovered.

The difference between labour and machinery is that machines only produce, labour both produces and consumes and labour pays tax on both.

If people are put out of work their consumption must fall , business gets less income and the government gets less tax.

 

[MrBurns]

How can that be??

The only way to measure that is to compare the amount of products and services consumed now vs then, and the average person consumes a lot more stuff now.

Things that even the poor take for granted now the rich couldn't have had in their wildest dreams years ago.

I could buy a house in the 70's kids today have no hope so I really don't think they're better off.

 

[MrBurns]

The problem with a crude measure like that is ignores heaps of variables to the point that it is almost meaningless. Two income households, higher wages meaning less spending as a % on necessities like food and clothing, to give two examples.

The ABS Household Expenditure Survey will break it down for you, but I think it doesn't go all the way back to 1975.

Did people pay 5x AWOTE because housing was so affordable, or was it 5x AWOTE because that's all they could afford?

I look at it from a real world view, there are suburbs now that are off limits to many Australians as they have been taken over, two income households ? what if they want children, childcare isn't the preferred way to raise kids and is nigh on unaffordable anyway. You can use all the arguments based on figures you like but the fact is I was better off than my children are today in so many ways, Australia has changed and not for the good.