Paul Keating is a former Australian Prime Minister. His actions while Prime Minister opened Australia to the greatest wealth redistribution in our history - a 30 year rogering by the forces of greed - globalist bankers and multinational corporations. Globalism has been a disaster for everyday Australians. In an attempt to cloud the issue and get to his grave with his legacy obscured Paul Keating is back on the speaking circuit defending his betrayal of the working and middle classes.
On this week's 7.30 Report Keating made this comment:
Australia has had a 50% increase in real incomes in the last 20 years, median America has had zero.
Did you spot the sleight of hand in this statement? Keating compared average income in Australia with median income in America. Average is total income divided by total people. It is heavily influenced by a small number of very high wages in the top bracket that just keep on going up. Median income is the mid point - the income at which as many people earn more as less. Let's take an example - your typical company that has moved their production to China, and only employ 3 people locally:
- A stockhand on $40,000
- A supervisor on $60,000
- An executive on $200,000
In this example the average income is $100,000 and the median income is $60,000. The median income is a fairer measure because it is more reflective of what ordinary people are earning.
OK now fast forward 12 months. Our Company has had a bumper year, profits are up. Now of course they do not pass that on to the workers because we are still not "internationally competitive". They keep all this extra profit in foreign bank accounts (3 trillion and growing) and award themselves massive pay rises. So in our example this is what happens:
- The stockhand stays on $40,000
- The supervisor stays on $60,000
- The executive gets a pay rise, share price bonus, discounted shares, and a profit bonus and now earns $400,000
The median income is unchanged at $60,000. The average income however has risen to ~ $166,000. This allows complicit financial press, politicians and of course the architect of this - Paul Keating to go on national television and proclaim that wages are increasing when in fact they are not increasing for average Australians.
The globalism dividend is accruing to the management and investment class at the expense of the working and middle classes. Trump worked that out. Pauline Hanson worked that out. Brexit worked that out. It is time you did as well.
So now let us look more closely at this data for those that, like me love themselves a nice dataset.
Labour market incomes are not increasing at 50% for most Australians
To make matters worse, the Government is most of the increase at lower income levels. In this section below (click the bar to see the data) you can see that the government contributions (green), comprised of pension increases over inflation, and income support have contributed half the income increase in the bottom 2 deciles, and made a significant difference right through the middle class.
Labour Market Wage Increases
Each decile is a ten percent group of wage earners (pre tax income), so the lowest wages are in decile 1 and the executive class wages in decile 10. Keating is correct in saying the average increase in income has been 50%, however the median income has only risen 25%. That differenced is quite significant when you look at the bigger picture in the sections below.
This data is old, I did find some from 2014 and surprise things are getting worse. While Keating is trying to suggest we are doing better than America so move on nothing to see, actually we did the worse of anyone.
The real worry here is that the private sector, in outsourcing jobs and retaining the profits for themselves, have transferred the burden of income support from the employer to the government. In effect the taxpayers are directly contributing to corporate profits by "paying" the workers via government income support. No wonder we have a deficit problem.
Corporate Profits are increasing
Corporate profits have done well from exploited Chinese labour. Sadly almost none of those profits have been passed on to average workers.
Not to mention cash rates at 2% so Corporations can finance themselves for next to nothing while our retirees have to live on an annual divident cheque from their retirement savings that is less than a Macquarie bwanker spends on a night of blow and pros.
Australian Corporate Profits
We are working harder for the small wage increases
Here is the thing. It is all very well to say that incomes have increased by 25%, but we are working harder for that increase. Remember the 35 hour week? Only bureacrats get that these days.
Higher productivity, which should create higher wages.
Internationally the same thing:
The inflation rate does not show just how much more expensive things have become
The basket of goods that the ABS uses for inflation does include housing & education, but only as part of a much broader range of goods and services. Many of these such as food, petrol and interest rates are static, so the massive increases in housing, education and child care are not being accurately reflected in the CPI. This means the "real" wage increase of 25% is completely offset by massive increases in these big ticket items. Lets look at what these indicators of living standards are really doing.
In Keating's globalist period the price of a home in real terms (after inflation) has increased between 150 and 300% depending on the method of calculation. Housing is moving out of the reach of Australia's working and middle classes. So who is buying at these prices?
- Credit Suisse estimates that residential investment from Chinese-based investors and new immigrants from China will more than double over the next six years to $60 billion. The company’s report said Chinese buyers were “important drivers of house prices”, having claimed 23 per cent of new housing stock in Sydney and 20 per cent in Melbourne in 2013-14. Reference
- Then add to that investment properties from people in the top 2 or 3 deciles of income, estimated by RPData at 27% of the market
So one half of Australian property sales are unavailable to working and middle class Australians. That is what is keeping valuations high - wage inequality and foreign ownership.
Visionary Australian Prime Minister Gough Whitlam made University degrees free for all Australians. So that is the benchmark. Successive governments, starting with Paul "class traitor" Keating have reversed that. With degrees costing between $45,000 and $150,000 it is fair to say we have gone backward in education, not only tertiary but technical (TAFE/VE) as well.
From the ABC: While the cost of raising a child has risen 50% in just the last 10 years, average wages have only risen 25% and median wages about 12%. That is squeezing family budgets like never before. The CPI bundle does not accurately reflect the increases in parenting costs. Parents are much worse off than it would appear.
Unemployment is hidden by the official statistics
Not only are we not earning that 50% more Keating talked about, fewer of us have jobs. At the start of the Globalist era unemployment was 2%. It is now over 13%, with much of that hidden by politicians like Paul Keating who understand that if the public were to know the real rate then globalism would be questioned. Having hundreds of thousands of unemployed people - good and decent Australians washing about the economy, willing to take any price to work and put food on the table is essential for the success of globalism. Labour has been robbed of it's power, smashed by outsourcing jobs overseas. A Labour Prime Minister did that, never forget that!
From my article on the real unemployment rate:
"The Australia Bureau of Statistics revealed that its measure of “extended labour force under-utilisation” — this includes “discouraged” jobseekers, the “underemployed” and those who want to start work within a month, but cannot begin immediately — was 13.1 percent in August 2012 (the latest for which I can find), in contrast to the “official,” and far more widely reported, unemployment rate of five percent at the time."
We are paying more in tax, but companies are not
The overall taxation burden in Australia has increased from a low of 24% in 1976 to a high of 28.2% in 2016, and with that projected to rise to 29.1% by 2019. This is necessary to meet the cost of income subsidies taxpayers are making to cover low wages being paid by Corporations, despite their record profits. As you can see from this graph, all of the increase in taxation in the last 15 years has come from citizens, who have seen their tax burden rise by 12% in this period.
Taxation burden falls on citizens not companies
Clearly private citizens are doing the heavy lifting when it comes to taxation.
Summary of the globalist FAIL
For average Australians:
- Income up 25%
- Increased taxation (including the GST) takes 12% of that straight back;
- Raising kids up 50%
- Education up 100%
- Real Estate up 300%
- Unemployment up from 2% to 13%
The benefits of globalism have accrued to the investment and management classes at the expense of the working and middle classes. Australia's lowest incomes have held their ground because the Government has picked that tab up. This has been paid for by increased taxation on the very middle class that has had the least income rise. If you feel like you are being squeezed - you are! This is just not sustainable.
It is time to dump Globalism.