Audit Commission declares war on young

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By Leith van Onselen

The Commission of Audit (COA) report, released yesterday, contained a raft of recommendations, the centerpiece of which were sweeping changes to Australia’s retirement system, including:

  • lowering the indexation rate of the Aged Pension to 28% of Average Weekly Earnings (from 28% of Male Weekly Earnings currently);
  • tightening means testing around the Age Pension, including capturing the value of one’s principal place of residence above $500,000 for a single and $750,000 for a couple;
  • gradually increasing the Aged Pension access age to 70 by 2053;
  • increasing the superannuation preservation age to 5 years below the Aged Pension access age, so that by 2027 it would reach 62; and
  • restricting access to the Commonwealth Seniors Health Card by adding deemed income from tax-free superannuation to the definition of Adjusted Taxable Income used for determining eligibility.

Taken at face value, the COA has produced a sensible set of recommendations, which are similar to those espoused on this blog for the past year or so.

However, there is a nasty sting in the tale in the COA’s recommendations that should anger Australia’s younger generations, which is summarised in the below statement:

The Commission considers that people born before 1965 should not be subjected to this change or any other further changes to the eligibility age to ensure they have adequate time to plan for their retirement.

That’s right, the COA panel – dominated by baby boomers – has conveniently chosen to spare its own generation from wearing any Budget cuts. Meanwhile, the younger generations – “generations rent” – will be required to bear the full burden of adjustment while their relatively well-off parents continue to enjoy their full entitlements while living in their expensive homes.

Retirement policy isn’t the only area where the COA places its cross-hairs over the young. It has also recommended that the Government curb Newstart – already a measly $13,273 per year (versus around $20k for the single Aged Pension) – by forcing young singles without dependents aged 22 to 30 who have already been on benefits for 12 months to move to higher employment areas or lose their payments, as well as increasing the rate at which Newstart payments are decreased for extra income to 75%.

It has also recommended slashing the minimum wage from 56% of average weekly earnings to 44%, as well as slashing family tax benefits, which could effectively lower families’ disposable income by 10%, according to COA modelling.

And of course, the generation that received free university education has recommended decreasing Commonwealth Grant Scheme funding for higher education from 59% to 45% and increasing the proportion of costs paid by students from 41% to 55%, along with increasing the interest rate on HELP loans.

While many of the COA’s recommendations can be justified in isolation on the basis of restoring the Budget back to long-run health, they are a bitter pill to swallow when the wealthiest generation – the baby boomers – have effectively been quarantined from bearing any Budget pain.

Genuine and equitable budgetary reform is about sharing the burden of adjustment. By excluding its own generation from cuts, the COA has failed, and in the process declared war on on the younger generations.

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246 Responses to “ “Audit Commission declares war on young”

  1. Mav says:

    Anyone who says that the cut-off year of 1965 is a coincidence, ought to be waterboarded.

    BTW, coincidentally /sarc, no mention of this intergenerational fraud in the mainstream media..

  2. migtronix says:

    I note Vanestone was part of that, explains her inane drivel re govt debt on counterpoint the other week. F me!

    • drsmithy says:

      You mustn’t listen to Counterpoint very often if you think inane drivel is anything unusual from Mandy.

    • footsore says:

      Mrs. Vanstone seems to be pushing for a permanent place in the public sphere. I don’t watch much television but I tend to see her in the funnies places, like on the Gruen Transfer. Fairfax also seem to have her opinion pieces up quite regularly.

      She never adds any value to the discussions she’s involved in. If she could comment critically and offer insight to the procedures she’d add something but it is usually just barrow pushing. Very disappointing, even if one expects it.

  3. LordDudley says:

    Yup, it’s explicit inter-generational war and class war.

    The young people of Australia need to wake up. My advice to any young person in Australia with the necessary means is quite simple. Leave. If it becomes worth your while to return, do so, but in the meantime you owe these creeps no favours.

    The Australian political apparatus has turned the economy into a big fat zero-sum game tilted against the young. The only way to win is to refuse to play.

    • migtronix says:

      Nice war games ref, and yes to all you say.

    • Many western economies will be facing the same demographic problems, an ageing population which will push higher costs onto the working/young. Where is it you suggest the young move?

      I think some people get too bogged down by the negatives. Australia is a great place to live on the whole, it would have to be a heck of a lot worse than today for me to consider moving to a different country.

      • willy_nilly says:

        Well with our peaking emigration of our 25 to 35 year old professionals now, many must disagree with you.

      • LordDudley says:

        From immi.gov.au:

        “In 2012-13, 43,423 Australia-born people departed permanently.”

        From the ABS, there were 309,582 babies born in Australia in 2012.
        Eek! That’s 14 emigrants per 100 contemporary births. Not so hot. And you can guarantee that those departures are the most skilled segment of the population.

        Let’s assume that the average emigrant is 30 years old; there were 234,034 babies born in Australia in 1984. 43,423/234,034 is 18.5%. This back of the envelop calculation tells us that about 1 in 5 Australian-born are choosing to leave and stating that it’s permanent when they do.

        This figure doesn’t count people like me and my family who haven’t left ‘permanently’, although we will be gone for an indeterminate period.

        Skilled Australians are departing at a disturbingly high rate.

        Bullion Baron: imagine the situation where you are a skilled engineer and your sector basically shuts down, leaving you unemployed in your home-town. You have to move or change careers. You can move to Sydney, Melbourne, or for about the same amount of money and hassle, move anywhere in the world. That was the situation I faced, and I suspect is frequently the situation that results in emigration.

      • balkanghost says:

        I’m guessing many could be working holiday visa makers (<30, away for 12+ months) and those with dual nationality/residency/passports?

        Nonetheless, boomerang or turnstile migration is fact of life nowadays from for study, work and travel…… but (national/istic) politicians are a bit wary of these people who get other ideas and may not be patriotic enough to fall for their nationalist and/or xenophobic propaganda…..

      • @LordDudley, I see what you are seeing re skilled workers with nowhere to go. This context was much more helpful than your initial post suggesting that ANY young person with the means should leave.

        Personally I am of the work to live, not live to work mindset, so the more important things to me in life are good living standards, a civil, comfortable & clean environment, close proximity to friends & family, etc. I’m reasonably well traveled and there’s not much that comes close to Australia in comparison (from my point of view).

    • SaCo says:

      Yes. Leave and be replaced by those from nations that still offer free education to their young. Or the children of the elite from other nations. Leave, you uneducated inexperienced youth. Be someone else’s burden. While it may make economic sense socially it sucks. What kind of society are you going to end up with?

    • Nunatak says:

      Lord Dudley,

      What a load of pathetic, defeatist rubbish.

      Since when has running away from a problem or challenge ever fixed anything.?

      How about stay and fight – get involved – get into the system and change it from within, instead of sitting on the outside bawling your eyes out.

      As BB points out, these challenges are not exclusive to Australia.

      Remember….if the grass looks greener on the other side of the fence, it’s probably Astroturf.

      • LordDudley says:

        Nanatuk…

        Who said anything about Bawling. I’m finding the whole situation in Australia quite amusing at the moment; Australians have gotten the government they voted for, and now they’re going to wear it. I’m quite enjoying watching the Abbott government go full retard.

        Australia really does have nothing but mining, working for the government or it’s associated parasite companies, and FIRE now. Bullion Baron asks where people should move… it depends on the industry you work in. For some industries, living in Australia is fine. Just be warned that nations with extractive industries are generally corrupt corrupt and lack economic diversity.

        If you’re in tech, Australia has become a joke. About half of software engineers I know have left the country, and none of those I know who have moved to the US have any interest in returning.

        At the moment, I put moving back to Australia slightly below doing my own dental work and slightly above developing a smack habit in my list of priorities. And it’s not just me; it’s a family of 5 (the wife has no interest in the place either the way its going).

        As for ‘staying and fighting’, screw that. You can’t change the system from within without devoting your life to it; it’s rotten. Ignoring overseas opportunities so that I can ‘fight’ and not be ‘defeatist’ would be pig-headed and stupid. Australians on the whole seem to want their economy to be based on digging up dirt and selling houses to each other; who am I to change that? You can’t out-vote the boomers and the oldies… there are simply too many of them.

        As for your grass is greener idea, that’s just a logical fallacy used to ignore obvious enormous problems that Australia has which most of its population generally refuse to recognise. It’s precisely the same logic as ‘Australia: love it or leave it’.

        The most effective thing young people with ability and ambition can do to change Australia’s course is leave. If enough of them vote with their feet, people both in Australia and all over the world will notice and start asking why. If Australia does change, those young people will have valuable international experience and contacts, thus enriching the place if they do move back.

      • Rusty Penny says:

        Since when has running away from a problem or challenge ever fixed anything.?

        Every time something new and improved was established in its place.

        Australia was an improvement on England by the 1870′s

      • Mr Lazy says:

        @ LordDudley “The most effective thing young people with ability and ambition can do to change Australia’s course is leave. If enough of them vote with their feet, people both in Australia and all over the world will notice and start asking why. If Australia does change, those young people will have valuable international experience and contacts, thus enriching the place if they do move back.”

        I disagree with your conclusion. Kiwi’s have been doing this for years and no-one in NZ cares one bit.

      • LordDudley says:

        Mr Lazy: excellent point. I have considered that Australia may come to be the Saudi Arabia of the Pacific in economic terms, with only resource extraction and a few associated sectors, with the population generally happy with that state of affairs (or at least not willing or able to change it).

        I hope it doesn’t happen. If it becomes clear that it has happened, then I’ll just drop my final strings of emotional attachment to the country and pay about as much attention to it as I do to Saudi Arabia or Venezuela, which is none.

        New Zealand does have the other problem of a very small population too, leading to less opportunities.

      • China-Bob says:

        I’m in much the same boat as Lord Dudley, I tried returning to Australia, but that didn’t work out quite as I planned. I naively hoped that the GFC would create a situation similar to the aftermath 1980 and 1991 recessions where real structural changes were instigated. Unfortunately (in many ways) Australia was rescued by China and the rest is history.

        In many ways I agree with this Audit Commission report, it at least acknowledges many of the structural problems with the present system and attempts to adjust some of the long term levers to effect change, its probably too little too late, but that’s nothing new. I suspect Australia will decide to also try its hand at growth through Austerity, that seems to be all the rage in Europe and the US.

        I wish I could see an Australia where enlightened politicians invested in some aspect of High tech Australian industry and magically created a real world leadership position in that field but lets face it that not gong to happen, even it it were t happen the real economic value would without doubt be captured by the FIRE sector.

        I certainly wish all Aussies well, I might even return, but to be honest, I’d probably have to be so broke that welfare seemed like a good option.

      • LordDudley says:

        +1,000,000 China Bob.

        One thing some people on this board may not appreciate (specifically the ones who think leaving is pathetic or something ‘leftists’ or never-do-well malcontents do) is that when you have a skill-set that takes a decade or more to acquire, and your industry is deliberately left to die by the government in response to a once-in-50-years mining boom, then your income necessarily declines. You may have trouble supporting your family; your living standards will certainly decline. Especially when Australia’s house prices are insane (because of policy) and everything is very expensive compared to almost everywhere else on Earth.

        So you take a big fat risk and leave. After a few years, you’re earning twice what you could at home (I’m honestly not exaggerating one whit here). Why, oh why, would you return under such circumstances? Not only would I earn much less in Australia, there is little opportunity for career advancement. I can’t start my own company because tech startups generally issue options, which are taxed at issue in Australia, which is why Australia has almost no startups.

        And it’s not just my industry that this has happened to… it’s quite a few industries in Australia.

        In spite of all this, Australia has better income equality than the US, better health care, more space (not that you’d notice by the house prices), and more equal education access. The Audit Commission recommendations will reverse a few of those, without making land prices cheaper or doing much to make the economy more dynamic (e.g. incentivise startups).

        If the worst of these recommendations go through, it will be akin to adopting the worst parts of the US system, but without adopting the better parts (some parts of the US system can’t be emulated because 300 million people makes a big difference).

    • Rod77 says:

      Correct Lord Dudley. These dipshits want to turn Australia into a U.S style Plutocracy. They want to bring the U.S student debt crisis to Australia so they can then convince the Feds to securities the bad debts.
      Then business will wonder why the economy sucks when young people are paying a third of their income out in student debt repayments and are barely able to consumer any non essential goods and services.

      • LordDudley says:

        Precisely.

        They’re trying to emulate the US, but without the economic dynamism. For all its faults, the US still has productive enterprise that isn’t mining, it has major differences between states allowing for competitive federalism, and it has gobs of CHEAP CHEAP LAND.

        Once Australia’s higher education system is as expensive as the USA (should be pretty soon the way things are going), the only things that will be better about Australia will be its healthcare system and gun-control laws.

        What a sorry state of affairs. But who am I to say it’s wrong… based on how Australians have been voting, this appears in aggregate to be precisely what they want.

      • Sauce_head says:

        Not to mention CHEAP CHEAP labour…

      • LordDudley says:

        Indeed… the CHEAP CHEAP labour is one of the bad parts of the US system…

        … it’s also one of the parts that the Audit Commission is attempting to emulate.

        I also don’t think for a second that it drives the US economy. The US economy is driven by large amounts of capital, concentrations of expertise/capability, and a willingness to risk capital. It is not driven by low wages.

        If anything, I suspect that the low wages contribute to insufficient aggregate demand, and thus unemployment and tax shortfalls.

    • Mr Lazy says:

      Another strategy is to be a subsistence citizen / minimalist

      Sure it’s not exactly the high life earning just enough to pay the bills. But there is a quality of life to be had in enjoying the simple things.

      Right this very moment apart from my marriage and my girl, I get a great deal of enjoyment growing my own vegetables.

    • Bill Bob says:

      So why are we sitting by idle allowing this to happen? If something isn’t done we will wake up, be 50 and it’s too late. We need to form a Macrobusiness party!

      • Rusty Penny says:

        Because the ability to reverse it has gone beyond reasoning, consensus, harshly worded emails.

        Only violence can alter the direction of things now, and it takes a very large shift in ones mental frame to get there.

        We’re also idle because inside we are hoping reason can reverse things as preferred choice, so we don’t have to make such a drastic change.

        It won’t happen though, too many people still assert this isn’t a ‘boomer thing’, and attempt to rationalise it away anyway they can.

      • migtronix says:

        @Rus yes reading the articles of protest that brought on the long parliament is eeery

      • Rusty Penny says:

        @Mig I know.

        I can imagine most here are thinking I am frothing at the mouth, having swollen temples and bashing down on the keyboard in misplaced fury.

        I am not, I am quite clam.

        I’m not seeking violence at an avenue of an outlet of energy, I am asserting that from what we know of human nature and history, the precursors of a vulgar, profligate class have set in and cannot, will not reach consensus for change due to entitlement.

        it’s just an attitude that cannot be dislodged without force.

        Stop deluding yourselves, there is no ‘nice’ way to resolve this.

        Not out of lack of effort, or pleasantries, or finding the right equilibrium point… it’s just a structure.

        We’re social animals, and we’ve built a social hierarchy now that won’t budge voluntarily.

        It’s like applying unwanted oil based paint on your car, you need to strip it all away and start again.

      • migtronix says:

        @Rus I go one further, you cannot bring forth a new paradigm w/o the contest at arms – the court where God is the magistrate.

        America can claim it’s own, Australia was a creation of the British Parliament and is therefore subservient…

        I don’t think you’re frothing at mouth, never have. You are far more measured and nuanced than I can manage.

        Kudos.

        #denysupply #libspill #auspol

    • Hugh Akston says:

      You’re a good-thinker Comrade Orwell. You’re such a loyal party member for remembering the subject of the two minute hate. Far be it from me to question the loyalty of an outer party member such as yourself but it would be remiss of me not to advise that you rephrase that last sentence as it might be misconstrued by some as a call to not pay their dues to Big Brother and we can’t have that now can we.

      Comrade O’Brien

      • LordDudley says:

        Comrade O’Brien,
        As we both know, before the end I will return to the fold. “O cruel, needless misunderstanding! O stubborn, self-willed exile from the loving breast!”. In the end it will be all right, everything will be all right, the struggle will be finished. I will win the victory over myself. I will love Tony Abbott.

        By the way, thanks for the re-education. I shall definitely write up an excellent review of Room 101 on Trip Advisor.

  4. Ronin8317 says:

    We need a political party that will represent the interest of non-baby boomers. Note that the disability pension crackdown will not apply to the Baby Boomers, they are really quarantined from all cuts. If the COA recommendations are implemented, Australia will have 2 class of citizens : the ‘Baby Boomers’ who gets all the entitlement of a welfare state still living in their multi-million dollar mansion, while the younger generation pays for the baby boomer’s welfare state and gets nothing in return.

    • AB says:

      Agreed, it’s a joke. And you can be sure that they will be insulated from any tax changes if the government can be bothered doing a tax review.

      I stopped taking this business seriously when they decided to do an expenditure review without a tax review at the same time.

      Most ideological government ever.

    • migtronix says:

      http://marchinmarch.com.au/sydney/

      MAY 18 looking at you General Disarray

    • Bluebird says:

      They know you won’t do anything. Too easy to stay at home playing games, drinking and bitching on forums. Everyone thinks those Occupy idiots are idiots.

      Let’s face it a lot of gen x & y have had years of retirement being kidults, travelling, bumming around playing computer games and so on.

      Just look at a lot of these faux marxists, “oh yay my house price went up”, “oh no I’m going to lose family tax benefits”. Hilarious.

      We’re just as divided amongst ourselves as we might be between boomers and the rest of us.

      • migtronix says:

        Tell that to Erdogan.

        Occupy might be idiots but you’re cretinous, most people can handle a little idiocy, cretins though? #libspill

      • Bluebird says:

        The open borders madness and the communism(for everyone but me) mind set? Sure.

        $300bn spent under Labor with next to nothing to show for it? Infantile.

        They don’t even have policies other than “Abbott sucks”. Yet they’re always saying how Abbott got in with next to no policies.

        They’re nothing but bogans in sandals and with pot smoking habits who think that because they read smh over news ltd it automatically makes them a genius.

      • migtronix says:

        @bluebird well at least no one will accuse you of being a genius – your safe. Like Abbott did anything in opposition but bash the leader. The sitting PM no less, showing how much contempt he has for Australia.

        @ff duh there was one yesterday for mayday. Rest assured Melbourne will come out in the rain

      • Bluebird says:

        It’s “you’re”.

        Good I’m not a genius. I’ll take that as a compliment. Smart people are often good at the hard stuff but fail miserably at the basics.

        A PM that has contempt for Australia? Could you blame anyone for having contempt for a bunch of idiots who think they’re fantastic for selling the joint down the river via a property ponzi?

      • migtronix says:

        @Bluebird A PM that has contempt for Australia? Could you blame anyone for having contempt for a bunch of idiots who think they’re fantastic for selling the joint down the river via a property ponzi?

        Sooooo …. Howards team?

        On the “you’re not your” smartphones and rain don’t mix #itswetinmelb

    • Hugh Akston says:

      “We need a political party” – beep wrong answer, thanks for playing.

  5. b_b says:

    Let’s be clear. No recommendation yesterday made any sense in the face if a slowing economy.

    The budget does not need to “return to health” while inflation is so benign.

    The narrative of “fixing” the budget only encourages the dumb policy – and surprise surprise, the dumb policy will not apply to those who design it.

    The COA was the biggest waste of resources in quite a few years – the deficit is driven by the private sector. If we want a surplus, drop rates to zero and get this private credit boom really humming.

    Madness.

    • flyingfox says:

      The economics aside, what about the notion of fair and equitable. Let’s assume for a second that the government starts handing out dollars that it creates, but only to those over 65 while cutting education etc.

      • b_b says:

        ff,

        Yes – you make a good point.

        But, is this really surprise? Workers wages and conditions have been attacked for a quarter of a century. Any excuse to shift wealth will do.

        And we love to keep giving them (Boomers / capital owners) the excuse. Let’s “heal” the budget.

        It is only when we get the economics right, we can get the equity & fairness right too.

    • The Claw says:

      If we want a surplus, drop rates to zero and get this private credit boom really humming.

      Pauline? Is that you?

  6. Researchtime says:

    This point worries me tightening “Means testing around the Age Pension, including capturing the value of one’s principal place of residence above $500,000 for a single and $750,000 for a couple”.

    Questions that jump at me include:

    (i) How could a retire live in Sydney or Melbourne?
    (ii) The idea that the value of the house relates to some kind of income? What about farmers – who may be asset rich but very income poor?
    (iii) If strictly enforced, how would the elderly get to modern hospitals as natural degeneration commences. Would that mean that health infrastructure would have to keep following them as they seek cheaper places to live – costing the tax payer more?

    • Have you not heard of a reverse mortgage? Even better, why not set up a government scheme so that the financial parasites are kept out.

      • b_b says:

        yes – more private debt so we can balance the federal budget measured in fiat.

        Brilliant.

      • Researchtime says:

        Yeah, I agree that is a nonsensical idea, as much of the self-interested vitriol under these tags. A select few narcissists – who would change their mind in an instant if they were in a pensioners shoes. I hope to God its a generational thing, I am gen X and I doubt many of my compatriots would fill these blanks. Maybe I am wrong – or maybe Christianity is finally leaving this land. I hope not…

      • StephenM says:

        Government is much better than providing a reverse mortgage than industry – the costs associated with guaranteeing future liquidity push ongoing product costs to exorbitant levels.

        Much easier to design it along HECS lines, where the government extends small periodic payments against the value of the house (a secured annuity in some senses) with a low interest rates capitalising over time. When the occupant(s) experience a mortality/morbidity/mobility event, the house can be sold and the proceeds netted off against the debt to government.

        No one is forced to leave. The only one disadvantaged (relative to the status quo) are the estate. and costs are kept to a minimum as the government is best positioned to manage/facilitate term liquidity risk.

      • Researchtime says:

        Good in theory, especially if debt interest rate is kept at rate of inflation, similar to HEC’s. However, can’t see that happening, given the current government wants to hive off HEC’s to investment banks and funds (at a substantial carrying loss !!!) because of its current weight/bearing upon the budget. Any similar housing scheme would be at least an order of magnitude larger than HEC’s…

      • willy_nilly says:

        Leith
        There is already a govt run scheme called the Pension Loan Scheme which could easily be expanded.

    • SaCo says:

      What’s wrong with that? You can then have excellent health services away from congested city centers. All the jobs that go with it and infrastructure. A farm is not a large garden it is a productive enterprise. The requirements of a homestead are also different to a city pad.

    • Jason says:

      The idea that the value of the house relates to some kind of income? What about farmers – who may be asset rich but very income poor?

      Owning a home means no longer having to pay rent, allowing them to use the pension on more discretionary items.

      The short and thick of it is that there is a huge gap between pensioners who own their own home and those that don’t.

      Then you’ve got efficiency of land usage, pensioners sitting on nice big 700m2 blocks in an empty 4 bedroom house while the young family is in an apartment or unit complex.

      • Researchtime says:

        But you inherit (tax free) – and you do as you will…

        People don’t realise – there will be no winners. In the advent of death taxes, you don’t inherit (and the rich still remain rich), and you will still be screwed when you get older. I have always though the sign of great thinker is the ability to think not just one derivative, but if possible three to four derivatives ahead. All I am seeing is the here and now – is a lot of narcissistic whinging, forgetting that they are living in one of the best country’s in the world.

        Would I live in a country where a person is not allowed to own a home, effectively gets no pension, pays what ever merger amount they get on numerous doctor visits. And when something serious does inevitably arrive, you hope to God its terminal and not chronic because you don’t want to suffer the pain!!!

        Is this Australia – is this my country? Some of you call for a revolution, you may get one – but not the one you expect…

      • SaCo says:

        “Would I live in a country where a person is not allowed to own a home” So it’s fine for you but for for a large number of Gen-X and Y this is already the reality. They live in a country where they may never own their own ‘home’ and will need to provide for their own retirement. By ‘home’ I refer to a normal building and not the shacks that’ve gone up on the outskirts of the cities over the last years.

      • Researchtime says:

        I rent – thats life. If you live in London (many don’t even own a car), or even Germany, the vast majority rent. You make what you can on the market – or other productive investments Its called capitalism.

        Personally, I think its a daft idea to be a slave to a bank and tie up capital for thirty years, where it could be put to good use. Who wants to be a worker ant their entire lives???

        It is that level of thought that will get this country into trouble in the long-run. Houses and holes my friend – houses and holes Are we all “Block-Heads”????

      • SaCo says:

        You are exercising a choice. What’s London got to do with anything? In Germany people choose to rent. They can also be assured that rents are not going to increase too fast year on year. Here you don’t have that assurance and couldn’t buy if you wanted.

    • Mr Lazy says:

      They’ll have to move just like unemployed are going to be forced to

  7. Pfh007 says:

    The grey and greying vote is important but is it enough to win elections?

    Don’t make the mistake of assuming its interests are monolithic. Labels like ‘boomers’ risks doing that.

    There is a world of difference between someone hitting 65 with little super and owning their own house and someone still with a mortgage one or more IPs.

    Talking about ‘boomers’ simply herds potential allies in with those who need some of their ‘lurks’ trimmed.

    There are lot of mid and upper middle class people who are trying to kid themselves that they are pensioners and deserving of income and other assistance.

    They want to hide in the flock of those more deserving of assistance.

    • LordDudley says:

      Indeed. This is why if we want to ‘fix’ the budget, the pain needs to be shared. Quarantining a specific generation as the Libs are doing will only stoke the flames of inter-generational war. The worst losers will probably be the elderly who are deserving of assistance.

      One may think based on my writings here that I’m in favour of class or inter-generational fights. I’m not at all. However, the way Abbott and his goons are going, they’re making such fights all but inevitable.

      • AB says:

        “One may think based on my writings here that I’m in favour of class or inter-generational fights. I’m not at all. However, the way Abbott and his goons are going, they’re making such fights all but inevitable.”

        My thoughts exactly. It’s becoming very clear who will be asked to sacrifice “for the good of the country” and who will be exempted.

      • Pfh007 says:

        Abbott may simply be wishing to convert the Howard Battlers into Abbott Oldies.

        Howard managed to bag a lot of voters who many on the ALP side simply concluded they are ‘not us’ – not smart enough, not poor enough, not moral enough etc. Plenty in the ALP deride the Bogan who in previous decades would be solid ALP. Abandon the middle – or even just sound like you do – and then watch the game from sidelines for 11 years.

        As a result Howard received a lot of underserved support from people who his policies did not support.

        Same could happen again – poor older voters assuming that Abbott is their man even though his policies do them no favours.

  8. moderate mouse says:

    Great piece UE.

    The only path to some kind of redemption for Joe would be to gut negative gearing (both future and present) and clamp down on super tax lurks. However, very unlikely that existing NG properties will feel any heat, and even less likely that super tax lurks will be pinned given the Audit’s rationale for quarantining pre-’65s.

    There really is something very wrong if the generation that has bagged the bulk of the loot from the boom times, especially through property inflation, (which already punishes younger generations) get off scot-free in Australia’s structural adjustment. All Joe’s talk of ‘everyone needs to share the heavy lifting’ will be pure bullsh*t, and the Libs really are just the party of the haves.

    I’m in my mid-30′s and I don’t expect a handout when I’m old. But I sure don’t want to be paying for handouts now to those who are FAR better off than I am. Viva the revolution…..

    • flyingfox says:

      I’m in my mid-30′s and I don’t expect a handout when I’m old. But I sure don’t want to be paying for handouts now to those who are FAR better off than I am. Viva the revolution…..

      Indeed …

    • rob barratt says:

      MM
      The phrase “negative gearing” does not occur in the commission report. This is because it was aimed at expenditure rather than revenue. Notwithstanding that, I strongly suggest you do not hold your breath waiting for any threat to that most sacred of cows..

    • Pfh007 says:

      Thanks for the link but Pascoe’s argument is pretty weak.

      All his criticisms of “competitive federalism” are illustrated by using failures of so called “cooperative federalism” (more commonly known as Canberra runs the joint). Joh was always more show than substance in his ‘QLD’ model.

      Unless he is proposing ripping up the Federal Constitution – which is never going to happen – it is better that the level of government that spend is the level of govt that taxes.

      The federal govt should taxes for the services it is responsible for under the constitution – which is not that much.

      That politics is a sham at both state and federal levels is a separate but not completely unrelated issue.

      Federal politicians blame states for failures of delivery and State politicians blame the federal government for insufficient resources.

      Commonwealth welfare for poor states is a possibility but then the standard welfare issues arise – is it a good idea to subsidise people to continue to live in a location that has poor or declining economic opportunities.

      • flyingfox says:

        Yeah I know. But there were some good points re land taxes etc in that drivel as well.

  9. 3d1k says:

    I disagree that this is ‘war on the young’. COA has sensibly restricted change to those best equipped to reposition themselves over time to any revisions that will impact financial security in retirement.

    • Leviathan says:

      No one cares.

    • migtronix says:

      Repositioned over time == young now.

      Nice tautology there, maybe your best work is done @7am when your walking 3d’s 3d

      #denysupply #libspill

      • 3d1k says:

        That’s not war – that’s adequate forewarning.

      • migtronix says:

        Well considering they’ll be picking your pocket today not so much

        #denysupply #libspill prosecuting the #armchairrevolution since 4/14

    • rob barratt says:

      I agree 3d1k
      Look at some of the key issues for the soon-to-be pensioners: Family benefit costs are a drop in the ocean compared to the tidal wave of potential health costs. To give you some idea of just the current situation, I lived in a caravan park in Brisbane for a while. I witnessed a huge number of Boomer country people arriving at the park in small caravans for one purpose only – to be treated at one of the large Brisbane hospitals. One guy arrived from Tasmania suffering from terminal cancer, Tasmania didn’t have the facilities or infrastructure to treat him. He was having to drink 2 pints of some appalling concoction which included a component which was designed to stop him throwing the whole lot up. He died a few days later. Let me tell you, a lot of Boomers are planning to move to anywhere just as long as it’s not too far from a major hospital. They know what it was like for the guy from Tasmania.
      The future is far more grim for gen X & Y. Why? Because the current generation of young and middle aged Australians are obese and too f@@@@@g lazy to do anything about it. This despite the fact they know obesity is associated with a truck load of very nasty and painful conditions. No, it’ll never happen to them.
      No, you won’t have excellent health services. They will be overwhelmed. You’ll need ten times the pension you want to deny us.

      • migtronix says:

        Errr wrong it’s the boomers who are morbidly unhealthy, if you look at millis/ys most gym/run whatever

      • rob barratt says:

        Mig
        Gen X & Y are much bigger than they were 20 years ago. Child obesity was virtually unheard of then. Have you waited behind a lot of young mothers at the supermarket checkout and seen the sort of stuff in their trolley? At a certain age, given a modicum of intelligence, you inevitably become an observer of the human condition. A nice test for some of our bloggers here is to substitute the word Jew for the word Boomer and see how it reads.. Ouch! If you want something to blame for most of Australia’s forthcoming financial situation, blame globalization and the failure of politics and by extension the voters to contain the bankers. You can’t pin that on the Boomer who was a postie, a cleaning lady or a shop assistant. Labeling boomers is like labeling Jews. Think about it.

      • migtronix says:

        I’ve thought about and it’s ludicrous! Jews were a minority and they were being blamed for things Jews were doing other countries. Not so here, making the absurd and offensive link is a stratagem – just like climate denier…

        Face the facts maybe those young mothers are buying crap because it’s all they can afford after handing over half their income to ip owning boomers who still get tax concessions from it FFS

      • Bluebird says:

        Agreed Rob.

        Gen x & y are good at complaining but have refused to tackle the elephant in the room, mass immigration and house prices. Too busy playing computer games, wasting money on cars, boats and big tvs, or going on some ridiculous, chasing the dragon, absurdly quixotic leftist trip.

        Who would care so much about losing family tax benefits and so on if their mortgage was half?

        Plus there’s no shortage of them on the so called boomer bandwagon themselves. Millions and even multi millions in debt, multiple ips, often interest only loans, all with just a rudimentary job to back it up if it goes tits up. There’s no shortage of thoroughly amoral, opportunistic parasites among gen x & y.

        But hey, give me $500 for me half hour cashy job, but I’m not rich, it’s only those nerds on $100k who are rich.

      • rob barratt says:

        So Mig
        Just so I understand, Jews were being blamed for what Jews were doing in other countries? What were the “other” Jews doing in 1935? You’re obviously happy that the posties and shop keepers can be labelled along with the rest of those Boomer bastards. IP owners the lot of them. Ironic really for someone who’s offended…

      • migtronix says:

        @Rob read history — in Germany they were being blamed for the bolshies in Russia – still fresh in people minds at the time. Hell Hitler took over by blaming the Riechstag fire on the communists/anarchists… But thats all by the by suffice to say it is a incredibly clear example of scapegoating minorities…

        As for Posties! I GUARANTEE you a boomer postie was able to buy a house and do most other things, a milli postie is renting on govt support. So yeah, that happened.

        EDIT: I’m glad to see Goodwins Law (the longer the internet thread the greater the probability someone will be called a nazi/hitler) still holds true

      • rob barratt says:

        Mig
        Having had a mother in law who was in the Hitler Youth, spent a week with a diplomat (Lord Hankey) who had dinner with Hitler before the war, and a father who was in the RAF during the war, I don’t need any history lessons thank you.
        But, more to the point, your words “I GUARANTEE you a boomer postie was able to buy a house and do most other things, a milli postie is renting on govt support.” does not imply any blame on the part of that postie. Therefore, labeling him in a perjoritive way is entirely unwarranted.

      • migtronix says:

        And still think to me boomer = jew. Wow.

        The postie had vote too last time I looked, voted for the destruction of the postal service too… Asleep at the bike…

      • migtronix says:

        @Bluebird $500 cash for a half hour job? What kind of escorts are cavorting with?

      • Opinion8red says:

        “If you want something to blame for most of Australia’s forthcoming financial situation, blame globalization and the failure of politics and by extension the voters to contain the bankers.”

        *applause*

  10. Andrew1234 says:

    There seems to be a real lack of forward understanding in these recommendations

    It is all good and fine trying to insulate yourselves from the storm but have they seriously thought this through?

    Imagine if they just scrapped Family Tax Benefits. Many millions of families receive $200+ a week there and would imagine for many (I am 37 and know many who are finding things tough) that would take a good proportion of their disposable incomes…

    Goodbye retail? Motor industry (oh yeah already gone) entertainment, dining out…

    And that is just one of the recommendations

    Unless it is spread evenly one major hit to the biggest spending group and its all over

    Cutting off their own nose to spite their face

    • Rod77 says:

      This report has created such fear that I think we can see a consumer retrenchment even if they don’t implement any of the recommendations. The punters now know that this is what Tony & co wants and they will stop spending now to prepare.
      Except of course on negative geared investment properties that will go gangbusters

    • infotech says:

      I say scrap all middle class welfare and reduce taxes significantly.

  11. Nunatak says:

    Wrong place.

  12. Leviathan says:

    This government is going to spark a genuine revolution – amongst their own ranks.

    It’s already starting.

    Anyone who votes Liberal seriously needs to consider their position on Abbott – as states and back benchers openly revolt.

    Liberals who genuinely care about their party should take this on board – they are staring down the barrel of their entire party being eradicated.

  13. retnuhb says:

    I hate all of these generational labels, “baby boomers”, Gen Y and so on. In all of this concocted “generation war” stuff going on, it seems to have been forgotten that many 50+ people (such as myself) are not acting purely in self-interest. I am completely in favour of policies which will make things easier for my children (in my case ages 17-22) to buy a house, and not have an excessive tax burden, even if that burden is shifted back to me. Most parents I know act in their children’s interest first, and put themselves secondary to that. Most grandparents I know do the same. I would vote for a political party which espoused those principles.

    • “I hate all of these generational labels”

      So do I. However, by excluding anyone born prior to 1965 from Budget cuts, an entire generation (the baby boomers) have been excluded from bearing any of the burden. It is the COA that has declared generational war.

      • 3d1k says:

        From alterations to pension entitlements – and fair enough I would say.

        On the other hand if changes are made to NG or super, some pre65 vintages may then disproportionately bear the burden…

      • AB says:

        “On the other hand if changes are made to NG or super, some pre65 vintages may then disproportionately bear the burden…”

        What a load of garbage (even assuming Joe has the ticker to make any changes).

        The pre-65ers are the most likely to have bought at much lower prices and be positively geared and will no doubt be spared any changes to super contributions and access.

        Such changes will be only for “…those best equipped to reposition themselves…” as you said above.

      • 3d1k says:

        AB I suspect there are many pre65s with investment properties, particularly in SMSFs – I’m sure more than a few attract tax concessions.

  14. Janet says:

    Perhaps the idea of the COA IS to start the War…well, a War anyway. Most people, regardless of age, won’t budge unless they are personally affected. So, affect them then..and let’s get this discussion going, not in theory, but in practice….

    • 3d1k says:

      Yes – at least the Commission has brought these issues to the attention of the broader public – and provided a clear reminder of the fiscal dangers inherent in having Labor in power for more than a term.

      • bad says:

        I agree with 3d1k, this is Labor’s fault for botching the mining tax. They should have retained the Resource Super Profits Tax rather than watering it down. If we had properly extracted more money from the resource rentiers the budget would be in a better position. Damn you Labor and thanks for pointing that out 3d.

      • 3d1k says:

        That is a comment I would never never make.

      • migtronix says:

        @3d a double negative you say

      • bad says:

        Glad for the clarification that you agree then 3d

      • migtronix says:

        Hang on don’t you barrack #Fiberal?

  15. b_b says:

    Meanwhile, Keen slowly continues his path to embracing / accepting MMT

    http://www.businessspectator.com.au/article/2014/5/2/economy/should-governments-run-budget-surpluses

    Given his understanding of endogenous money, it is incredible it has taken him this long.

    • migtronix says:

      You would say that Peter ;)

      Cheers for the link

    • Pfh007 says:

      “….embracing / accepting MMT”

      I suppose it depends on what that means.

      Do you have an explanation why those who embrace/accept MMT, who generally see govt as having an important role in relation to resource allocation – eg job guarantees, do not go the next step and support an end to endogenous money creation by private banks.

      I have seen a few articles on the web over the last week or so from the MMT end of the spectrum where the writers seem to be opposed to ending endogenous money creation by private banks but it is not clear why they would not support moves in that direction.

      I have assumed that it is because so much of the MMT theoretical architecture is tied up with the current private banks / central bank model that they find it hard to let go of it – but perhaps there is another explanation.

      • b_b says:

        Thanks for the question pfh,

        I’m not sure I can answer on behalf of all MMTers but I can answer that from my perspective.

        MMTers rejects the idea of a gold standard and embrace the idea of fiat currency. They believe, this gives policy makers maximum flexibility to counteract the business cycle, and meet the needs of citizens (eductation health etc).

        For Fiat currency to work, it has to be universally accepted across the private sector and banking system. To be universally accepted, there should be no competing currencies which is what happened in South America in the 1980′s (US dollars). That is, the currency should be issued by a monopolist.

        That monopolist can be a CB or other agency – but it should only come from one entity.

        Now this is where the MMTers borrow some ideas from the Austrian school.

        Monopolists can either control price or quantity for their product Not both (note, under a gold standard you control neither). So in a pure fiat issuing currency, you either target interest rates or loan volume.

        Clearly most western countries target interest rates and allow private credit to run. The PBC on the other hand largely controls volume by altering bank reserves.

        The issue of controlling volume of loans is that not all credit worthy projects will get funding & credit is rationed. The downside of controlling price is too much private debt creates financial instability. But excessive private debt need not occur if the Government runs appropriate sized deficits (which adds to private sector savings).

        So on balance, as an MMTer, I think
        - Fiat currency gives society the most flexibility to manage the business cycle (and avoid another depression)
        - It requires a monopolist to either control the price or volume of money
        - Controlling price allows volume to vary (endogenous money creation) so that all credit worthy private projects get funding which is good for investment and productivity
        - Appropriate government deficits which offset leakages in the system (CAD, superannuation) will ensure private debt does not get out of hand.

      • flyingfox says:

        @b_b

        For Fiat currency to work, it has to be universally accepted across the private sector and banking system. To be universally accepted, there should be no competing currencies which is what happened in South America in the 1980′s (US dollars).

        And that is where the things start to fall apart, especially for smaller countries like Oz. You will always have competing currencies and “barbaric” artefacts.

        Yes the CB controls the volume etc of the local currency but in a floating rate environment, does not always control the buying power relative to the other currencies.

      • migtronix says:

        @b_b the issue in Sth America was not use of the US dollar — or anything else for that matter — it was political instability paid for with… you guessed it US dollars. How do you think there was so much USD to be used in the first place? Narco recycling…

      • b_b says:

        Ff,

        There is no competing currency to the aud in Australia. Try borrow USD and buy a local house in usd and see how you go. Try do it in an even smaller country like nz, and see how you go.

        In terms of buying power, I (and most other mmters) would agree. There is no guarantee fiat currency retains its value. But the prediction of the collapse of fiat tends to be over exaggerated by the hard currency types.

      • Opinion8red says:

        b_b,

        So true about the “hard money” types. Their willful naïveté / stupidity never ceases to amaze me.

        Their basic premise is that “hard currency” (typically, gold) is somehow a natural inhibitor of manipulation of money supply. They fail to see that even with a gold (or other commodity) standard, if someone — or a cabal — is able to gain control over the

        1. Stocks;
        2. Supplies; and/or
        3. Reporting of reserves;

        of the underlying commodity, then manipulation of money supply is not only possible, it is actually easier to achieve. Why? Because the very existence of the supposed “standard” acts as a smokescreen, a curtain the money supply manipulators can hide behind …

        https://www.youtube.com/watch?v=YWyCCJ6B2WE

        *shakes head*

      • flyingfox says:

        @b_b

        There is no competing currency to the aud in Australia. Try borrow USD and buy a local house in usd and see how you go. Try do it in an even smaller country like nz, and see how you go.

        I can borrow in USD and buy a house in Oz (not in USD) if I have collateral. To “borrow” another anecdote, our friends from the mainland are supposedly arriving with suitcases of cash (Oz or USD) and purchasing property here due to the supposed safety of Oz but I am beginning to suspect that these are officials from up top who new about the “reforms” i.e competitive devaluation.

        Again this is a distinction between wealth and currency and I am well aware.

        But let me put it to you in a different manner, the buying (or selling) power afforded to me does not depend on the currency I hold as long I

        1) I have enough of said currency.
        2) It can be exchnaged for the good or service directly or indirectly.

        I can choose to work in Oz, earn in AUD but save in Gold. Every starts doing that and we have the issue that India had not too long ago.

      • Pfh007 says:

        b_b

        thanks for the reply.

        gold standard? I wasn’t questioning fiat currency rather the control delegated to the private banks over the money supply via their loan creation activities.

        That is corrected by the requirement of 100% reserve lending. The responsibility for the money supply would then fall on the government which it could manage directly via fiscal policy and the decisions to tax or spend.

        National accounting is a large part of the problem – the government should control the money supply but characterising its choices in that regard as either deficits or surpluses seems a large part of the problem.

        Stopping the endogenous money creation practices of the private banks would seem an important objective if moving to a better understanding of fiat currency is desirable.

    • Buzz says:

      Yeah I don’t get that either. I’m quite sure he has always been fairly close to the MMT/MMR positions especially on government debt. As far as my understanding goes, he is quite focused on the private sector in his models. I remember reading on his blog somewhere that there is not much difference to his ideas and MMT and that they pretty much converge, one point he did mention where he differs is that he believes both public and private debt can rise at the same time.

      • b_b says:

        Private debt and public debt rise at the same time when country runs a sizeable CAD such that government deficits do not cover the entire external deficit. Sectoral balances 101.

        The main point being, a fiat issuing government (pubic debt) can never run out of its own fiat. The private sector can run out (go broke). It is a critical distinction.

      • Buzz says:

        I’d be amazed if that wasn’t his position

      • Opinion8red says:

        Yes, in theory, a fiat-issuing government can never run out of its own fiat. However, where I have a major quibble with MMT, is that it appears to ignore the economic and political realities of usury.

        For a couple hundred years now, the private transnational usurer class has clearly shown that it will not permit a sovereign government to issue its own usury-free fiat. Any that have dared to try, have ended up either (a) assassinated, or (b) invaded.

        OTOH, if you implement an MMT system and include/permit usury, it is 100% certain that the same problems of corruption and manipulation of “money” supply and access to “finance”, wealth inequality, poverty, oppression etc will all recur, if only in slightly different forms, and over slightly differing time frames.

      • Buzz says:

        Yeah although it can never run out I guess when trust/acceptance is lost due to loss of control of inflation could make a fiat issuing country effectively go broke?

        Would that more easily happen for a CAD country?

      • Buzz says:

        Yeah I feel you are quite right on that, except that it will take a long time to play out to its end hence why everyone would ignore it.

        I do find it interesting that it was once banned but somehow slipped back into society, to the point today where one sounds like a nutter for even mentioning its validity?

        I remember hearing about a book written recently about interpreting how Jesus would view the economic world or something similar? Maybe its this one that Gittins is referring to?
        http://www.smh.com.au/business/what-jesus-said-about-capitalism-20120408-1wjmm.html

        Not pushing religion here, just highlighting what one could view as modern Christian hypocrisy. I remember the one time he ever gets real angry in the bible was over the money changers :p

      • Opinion8red says:

        Thanks for that link Buzz. Actually a rather good piece from Gittins there. I’m now intrigued to track down the book he referred to in that piece … as you may guess, I have quite an interest in the true origins of all these matters ;-)

        FWIW, and not in any way wishing to be seen as preaching — I frankly despise all forms of “organised” or institutional religion — but I maintain that if a soul in true and good conscience were to obtain a Red Letter bible — one where the words attributed to the “Christ” of Christ-ianity are printed in red — and then, were to read and take to heart only the red lettered bits, and ignore the rest, we would see a very differently thinking and acting Christian to those we see today.

      • b_b says:

        Opinion – mmt does not ignor usury. It fully understands the accounting process of interest payable and receivable. I have tried to explain this to you but you refuse yo accept the basic accounting identities.

        Btw – we already have an mmt system. That is what mmt is – a description if the modern monetary system. The failure is policy.

      • Opinion8red says:

        Yes, true b_b, that is where we fundamentally disagree. I maintain that MMT misunderstands the usury function.

      • b_b says:

        @ Opinion8

        ” I maintain that MMT misunderstands the usury function.”

        Ok. Lets try again and see what I am missing.

        The Loan creates the deposit. Accounting entries are;

        Dr Loan $100 (bank asset / household liability)
        Cr Deposit $100 (Bank Liability / household asset)

        After 1 year, and assuming interest rates are 5%

        Dr Loan account $5 (total loan now $105)
        Cr deposit account $5 (total deposit $105).

        I know this is simplistic, and banks & staff take there share, but lets keep it simple at this stage. So where exactly do we disagree in this example?

      • migtronix says:

        @b_b but you refuse yo accept the basic accounting identities

        Or we refuse to accept that bringing forward payments is in any way sustainable! Sheesh!

      • b_b says:

        Ok Mig – what is wrong with my example above? Where do we disagree?

      • migtronix says:

        @b_b nothing wrong it with per-se except that you’re bringing forward earnings, imputed and all that.

        I get that extinguish all the outstanding loans would require all the outstanding money not any more, but you appear to ignore the deliberate extortion of making a claim on a non-service i.e. making credit out of thin air!

      • b_b says:

        “I get that extinguish all the outstanding loans would require all the outstanding money not any more,”

        Good. That sounds like progress, or we just did not understand each other before.

        ” but you appear to ignore the deliberate extortion of making a claim on a non-service i.e. making credit out of thin air!”

        I see two problems with this statement

        1. While is seems like Banks make money out of this air, the reality is that Banks are regulated and require a certain level of risk capital. So the loan process does in fact have a constraint – equity capital.

        2. Banks just don’t lend people money for the sake of it. There is a credit process and Banks regularly spend millions on IT, back office, and compliance to ensure the stability of the operations. In short, there is a real cost in running a bank. So I find it hard to accept they offer a non-service.

        Now I am the last person to defend banks – I think they should not be “pure” private enterprises and they should be more regulated. But they do offer a service.

      • migtronix says:

        @b_b we didn’t understand each before and still don’t, all the things you mentioned, amortised, have a margial expense pushing 0, certainly not compound f#@&ing me in the #@£&.

        The usury (enabled by double entry accounting which “balances” the books by bringing forward earnings) is a drain on the monetary base, and therefore people’s ability to find the money necessary to extinguish the loan.

    • Buzz says:

      What do think of this statement of Keen’s?

      Note Bernanke’s assump­tion (high­lighted above) in his argu­ment that print­ing money would always ulti­mately cause infla­tion: “under a fiat money sys­tem”. The point made by endoge­nous money the­o­rists is that we don’t live in a fiat-money sys­tem, but in a credit-money sys­tem which has had a rel­a­tively small and sub­servient fiat money sys­tem tacked onto it. – See more at: http://www.debtdeflation.com/blogs/2009/01/31/therovingcavaliersofcredit/#sthash.eHWDR3Zf.dpuf

      Can’t find his original one on his site but here is one linked elsewhere -
      http://mikenormaneconomics.blogspot.com.au/2012/09/steve-keen-keen-2012-umkc-reconciling.html

      • Buzz says:

        https://www.youtube.com/watch?v=AZlt6jSrgP0

        I think he is saying we don’t run a proper fiat system, we run a credit system. Is he ignoring the CAD? Can the private sector create credit independent of what the government does? I guess in the long run no but short/medium term I think they can?

      • Opinion8red says:

        Buzz, the critical distinction that everyone (including Keen) fails to make, is between a money system where a usury repayment obligation is attached to the original “credit”, and one where there are none.

      • b_b says:

        Printing money in excess of the increase in real goods and services will cause inflation. There are two points to note from this

        1. Printing money does not come from QE. Money is printed via the Treasury (in concert with the RBA) via deficit spending.

        2. When output is below trend, there is scope to deficit spend (print money) to increase output back to trend in a non inflationary manner.

        Banks create money via the loan process, but no NET money (because the loan = deposit). Net money is created by deficit spending by the government.

        Ongoing low inflation here and overseas, plus persistently high unemployment is proof we are not printing (spending) enough.

  16. sadness says:

    ….Oz was good for the beaches and the climate….but no worries, Tony, Joe and the yesterday men are working on that too

  17. Opinion8red says:

    This is a deeply saddening comment thread. So many who can not (or will not) see the forest, for the trees of their own self-interest. So much passion, misdirected.

    What is the real problem here, folks? Seriously.

    The underlying root problem is very simple. Usurers — aided and abetted by dependent politicians — have enriched and empowered themselves by radically distorting both “asset” prices, and the structure of the economy as a whole, via the distribution of debt, over decades. Both household and government budgets are now overstretched (costs > income) in consequence — which reality only forces both public and private sectors ever deeper into the clutches of the usurers.

    Short of money? Can’t make your income > costs? Off to the eagerly waiting money-lenders with their electronic bookkeeping entries at “easy finance terms” you must go.

    The present form of our Laberal government is now performing a minor variation of the Punch ‘n Judy puppet show for the ignorant masses. A grand performance which, for all its many pretences and sophistries, is in fact a mere sideshow distraction, designed to do little more than rationalise and place the stamp of “independent” “expert” “authority” on a suite of policy adjustments that will in sum amount to the achievement of only one thing.

    More. Of. The. Same.

    More debt obligations. Somewhere.

    More usury income. Everywhere.

    What has caused the situation resulting in consequences whose public policy responses now serve to further divide us, is the unchecked spread of the all-pervading economic and social cancer called Usury.

    Continuing to bicker over who does or does not receive more or less pokes up the @r$e from the various possible policy responses to the basic problem of there being NOT ENOUGH MONEY TO PAY THE USURERS is entirely self-defeating.

    By arguing over responses, rather than addressing the ultimate root cause, you all continue to play right into the usurers’ hands.

    • Bluebird says:

      Yeah when those Occupy idiots start talking about crashing their own inner west house price and maybe implementing a bit of debt forgiveness they might be worth listening to. Also fixing up the perverted monetary system, etc.

      Also getting rid of a lot of government nimby powers to build like hell to accommodate their beloved brown people. 100 story unit towers all over the joint. Kebab shops and Thai shops all over the place so we can congratulate ourselves over the fatty foods, I mean the culture.

      • Arben says:

        @bluebird — got anything beside bile & racism?

      • migtronix says:

        @Arben Yeah man! Beloved brown people? The #$%&?

        I think I broke his brain…

      • LordDudley says:

        Bluebird said: “build like hell to accommodate their beloved brown people.”

        BING BING BING BING! And there we have it folks. What we are dealing with here is nothing but a piece of shit racist.

        Can we hellban this turd?

      • Bluebird says:

        And there we have the reason for the Lib’s existence. Leftist scum poised like cobras wanting to use their little abusive terms to shut someone down and vilify them.

        What I said was not racist. I was encouraging the development of units to accommodate people.

        Unbelievable. Bring on a civil war. You people are toxic shit.

      • Rusty Penny says:

        Well that escalated quickly.

      • LordDudley says:

        “And there we have the reason for the Lib’s existence. Leftist scum poised like cobras wanting to use their little abusive terms to shut someone down and vilify them. ”

        Drop dead you filthy racist scuzzbucket. You think anyone to the political left of Sir Joh Bjelke Peterson is a leftist.

        Like I said, we’re dealing with an out and out racist here. Can we hellban this backwards fool?

        Just in case you don’t understand, you brain-dead poltroon, ranting about those you don’t like and their ‘beloved brown people’ outs you as the racist piece of filth that you are. Go get ‘I hate niggers’ tattooed on your forehead or something. Then when people shun you, you can loudly complain that you are the one being ‘shut down and vilified’.

      • Bluebird says:

        LordDudley I despise people like yourself. I assume you’re another white marxist straight from uni. I don’t hate non whites. What I hate is “leftists” wanting mass immigration without a clear cut way to accommodate them in affordable housing for the immigrants and the people already here.

        So wanting to accommodate immigrants in affordable unit towers makes *me* the racist? Unlike those posuer “leftist” fucktards that populate the Inner West yet are nimby as hell? Typical religious and cultist like thinking from the scum like you who populate what is our current left power base.

        I want people like you removed from the left and annihilated and replaced with people who can think free from histrionic and outdated causes from the 70s that aren’t really needed anymore, like “racism” and “feminism”. I hope Abbott’s university reforms aids that cause.

      • migtronix says:

        want people like you removed from the left and annihilated and replaced with people who can think free from histrionic and outdated causes from the 70s that aren’t really needed anymore, like “racism” and “feminism”

        LOL I’d love to hear you say that to a “brown” person!

        Can you think free from histrionics? Or are you too busy searching for #crumbs?

        Keep voting #fiberal and keep telling yourself its not because you’re a boomer!

      • migtronix says:

        non whites

        LOL another nail in the coffin!!! LOL!!!

        Dude you lose.

      • LordDudley says:

        “LordDudley I despise people like yourself. I assume you’re another white marxist straight from uni. I don’t hate non whites. What I hate is “leftists” wanting mass immigration without a clear cut way to accommodate them in affordable housing for the immigrants and the people already here.”

        You really are a bit thick, aren’t you. I’m a 38 year old engineer with a wife and 3 kids working for one of the world’s largest corporations in California. I personally don’t depise you; I just find you to be rather pathetic, and think you should be hellbanned until you can stop being a racist ratbag.

        “So wanting to accommodate immigrants in affordable unit towers makes *me* the racist? Unlike those posuer “leftist” fucktards that populate the Inner West yet are nimby as hell? Typical religious and cultist like thinking from the scum like you who populate what is our current left power base.”

        Good God, what are you blathering about. You were the one ranting about other people’s “beloved brown people”. If that’s not racist dog whistling, nothing is.

        “I want people like you removed from the left and annihilated and replaced with people who can think free from histrionic and outdated causes from the 70s that aren’t really needed anymore, like “racism” and “feminism”. I hope Abbott’s university reforms aids that cause.”

        Of course you want people who dislike ‘racism’ annihilated. Because you’re a racist lunatic. Your definition of ‘the left’ includes almost everybody. You should come here to California and we can hang out in Oakland and tell black people that racism is an outdated concept; do you happen to have a flack jacket and perhaps a couple of rottweilers, because we’ll need them.

      • Bluebird says:

        I said I didn’t hate non whites and that still makes me a racist?

        This is a whole new level of deranged. You three would make good members of the Stasi.

      • migtronix says:

        Ummm there’s no such thing as “non” white? Retard! Do some physics…

        @Lord Dudley I’m a 38 year old engineer

        Man there’s a lot of us here! … also, sooooo… Facebook?

        EDIT: As for the stasi aren’t you the one who wants to extreminate opinions? Hmmmmm Boomer much? [i.e. do as I say no as I do]

      • Bluebird says:

        What’s hellbanned? Is that more hipster jargon? More jargon to show how “progressive” you are?

        So now you’re going to hide behind blacks in the US?

        I was talking about Australia. Where there is little to no racism.

        What am I talking about? Nimbyism in concert with mass immigration. One of the main reasons for unaffordable housing.

        Congratulations, you’ve got a wife and 3 kids and you’re spewing over house prices in Australia whilst living in the US. You’re working for one of the world’s biggest corporations, well aren’t you fantastic, is it shelf stacking for Walmart?

      • Mav says:

        blueboy.. if you want to have a juvenile rant, you should go back to the property troll nest (with Peter Fraser for company)

      • migtronix says:

        So now you’re going to hide behind blacks in the US?

        I was talking about Australia. Where there is little to no racism.

        Ha ha ha aaaah ha ha ha ha

        beloved brown people

        Now look here Blueballs if you’re pent up you’ll be better served spending $500 cash for one of those 1/2 hour jobs you familiarise yourself with…

      • LordDudley says:

        Bluebird said:


        … mindless drivel removed …

        What am I talking about? Nimbyism in concert with mass immigration. One of the main reasons for unaffordable housing.

        … mindless drivel removed…

        Yet another demonstration that a stopped clock is correct twice a day. I actually completely agree with you that NIMBYism combined with an immigration level set too high are some of the main reasons for unaffordable housing in Australia. There’s a lot of NIMBYism in the Bay Area, and it’s rather silly and annoying, especially for low income earners who have trouble meeting the rent.

        See… we do have something in common :).

        Mig: I don’t work for Facebook. I have several friends who do. This is guaranteed to make Bluebird pigeon-hole me as a leftist hipster, which is fine by me. Being despised by a certain class of person is a badge of honour.

        Although by saying who I don’t work for, I’m inviting you to list every company in the Bay Area in order to nail down my employer by a process of elimination :).

      • migtronix says:

        @Lord: actually is was a joke because you said “one of the biggest” not the biggest (i.e. google).

        I was offered a place @twitter 18 months ago before the IP, probably should have taken it and left Australia (again) but I’m committed to my (relatively) little med space s/w I do here atm :)

      • Bluebird says:

        @lorddudley, so instead of just agreeing with me you had to go on a histrionic rant about racism, over the pretty weak term “brown people”. This is why you lot lose.

        The left and the Occupy movement, the Greens, just you fucktards in general, need to have this as number 1 policy(destroying nimbyism), but instead all you do is bitch about refugees, all but non existent racism, and having to work another 3 years.

        The solution is extremely simple. Either reduce immigration or build like hell. Yet you spend all your time masturbating over petty shit in order to display how “intelligent” you are so you don’t have to actually do anything about it. You’re cowards.

        F#ck the 3 or 4 of you all very much.

      • migtronix says:

        Sweet surely by now I have a free reign?

        You boomertards, sycophantic to a man, are the fuck that God didn’t give.

        Servile to your c*nty #crumbs distributors you fucking arseholes ruined everything from music to housing affordability.

        And you talk about nimby? Fucking tossbag you’re comments about immigration (whether I agree or no) are pure fucking nimby! Dumb fuck

      • balkanghost says:

        @BlueBirdOfficial Sustainable/Stable Population Australia policy?

      • Bluebird says:

        “Sweet surely by now I have a free reign? You boomertards, sycophantic to a man, are the fuck that God didn’t give. ”

        Oh surely you can see now that boomers are God’s generation? You got owned. Pwned. Get over it. Now’s where you’re supposed to come up with a vision and policy and the vehicle to actually do it.

        I’m not a boomer, I’m gen x.

        “Servile to your c*nty #crumbs distributors you fucking arseholes ruined everything from music to housing affordability.”

        I’m just going to suck it up and work hard instead of partaking with clueless leftist fools.

        Oh get real. Gen y ruined music by listening to rap crap and pop music, and by just generally sucking at drums, bass and guitar. That’s one thing where there is no argument, boomers were by far the best at music. Was watching a Neil Young clip the other day, the song “old man”, man that guy was only B grade for his time, but would be the star of the whole world today. You suck at music.

        ” And you talk about nimby? Fucking tossbag you’re comments about immigration (whether I agree or no) are pure fucking nimby! ”

        Well not really because we’re bringing them in at 1k or something a day, and I’d like to house them and me affordably. Where as your Occupy douche bags you love so much refuse to say a thing about it. Even though it’s the number 1 cost in life. It’s hilarious you couldn’t make it up.

      • migtronix says:

        We suck at Drum&Bass? Whaaaaaaa? #ur2funny

        I could tell you aren’t boomer by your alacrity with memeology ;)

    • interested party says:

      “So many who can not (or will not) see the forest, for the trees of their own self-interest.”
      This is so true. Due to the nature of fiat, there is a wide belief that there is a scarcity of money that ‘forces’ people to compete with each other……so ‘self-interest’ grows unchecked and un-noticed like a weed behind the back shed. There is no ‘scarcity’ of fiat.

      Op8
      As you have so correctly pointed out, while people squabble over technicalities of discussion like seagulls over a dropped chip at the beach, the usury industry rolls forward….knowing full well that there is no risk to their business model while the population desperately cling to their own ‘vested interests’. Yes folks…you are being called out on this…and I am guilty of the same.
      A MAJOR understanding fell into place for myself yesterday with your post ( linked in your comment above) and I thank you for that.

      • Opinion8red says:

        “…there is a wide belief that there is a scarcity of money”

        Actually, I would quibble with you on that point. The problem is quite the opposite of what you describe.

        There IS a scarcity of money. And it is that artifice-ial scarcity that forces everyone into competition with each other, in order to obtain it.

        The reason for that artificial scarcity, is that when “credit” is created, in the form of a new loan, only the principal is created. The usury obligation which must be repaid too, is not created at the same time.

        In order to repay the usury obligation too, the borrower must obtain additional “money” (itself owing usury) from someone else. Seen on a total system basis, the only way that all the uncreated usury obligations can be repaid — the only way that the usury industry can get its “income” — is if ever more loans (of principal) are continually being issued into the system.

        The consequence is that the total of debt obligations owed, always exceeds the total stock of “money” with which to repay them.

        To put it another way, if a decree were made that all debts must be settled in full, today, there is insufficient “money” in the system to pay out all the loan obligations.

        edit: re the link, happy to help ;-)

      • interested party says:

        Op8,
        yes and no.

        For the man on the street there is a scarcity….this is in the design.
        For those in control of the supply there is no scarcity….they have conjured trillions since 08/09.
        The arguable point is the path and destination of the fiat and cui bono. As you are well aware, to keep the population in control we are pitted against one another in competition for so called scarce resources….as per the thread topic and comments shared.
        In a pure sense, yes, there is never enough fiat to cover BOTH principle and usury costs at any point in time.

      • Opinion8red says:

        ip,

        Ahhhhh, forgive me. I misunderstood your intent in your use of the phrase “wide belief”.

        Damned interwebs; nuance easily lost.

  18. Ozquoll says:

    The title could equally well have been ‘CoA declares war on the poor’. The attacks on the minimum wage and Newstart are disgraceful.

    There is clearly an intent to develop a US-style underclass in this country.

    • b_b says:

      Yep – and it al happened on May day.

      How appropriate.

      • migtronix says:

        That was a kick the pants, real numerologists these neoconservativea #libspill

    • Mining Bogan says:

      The Senate lot seems to have dragged out that the 11 GP visits a year may not be quite correct and is probably just made up. War!

      Those clowns on their $1500 a day should just pay it back and start again.

  19. Rusty Penny says:

    n times past when I said the profligacy and selfishness of the boomers would be preserved at the expense of everything else, I would told not to generalise.

    I was told NABBALT (Not all baby boomers are like that)

    See?

    I also followed up that they’re too selfish, too entitled to be able to reason. “What have you done? Where are your marches? You haven’t fought enough! Running doesn’t solve anything!”

    Blah blah blah…. negative assertions on the character of those that follow.

    Listen, this is a generation that have all been welfare recipients their whole lives.

    Whether it has been transfer payments, or unsound tax deductions, they have never, ever paid their own way. Other generations have always underwritten their standard of living.

    Dismiss me once again?

    Democracy has a lifespan, that once the punter can vote themselves gratuity at the expense of sustainability, they will. It a fatal flaw, but we have reached it.. due to the boomers.

    Dismiss me once again?

    It needs to be rejuvenated, and that involves a radical change. Evolutionary… or revolutionary. The boomers inability to reason points to the latter.

    Violent physical harm needs to come their way, there is no other way to incur change. Any student of history can assert this. Violence can incur change for good, dead boomers will be a change for good.

    I understand the instinct to cringe, we’re all conditioned to suppress those impulses, that a communal peace delivers the best for everyone. This won’t work however when once group keeps returning to the well. They are all conditioned welfare junkies, they don’t know any better than to keep taking from someone else.

    or of course… dismiss me once again.

    The CoA list is just the tip of the iceberg, the beginning of the wedge that will only increase. To think that modifying aged income support in 2035 fixes the problems of today….??? It beggars belief.

    I understand that a change of frame control is necessary, and it will take one to a dark place. The alternative is being a working poor, wage slave for you and your kids.

    Do nothing…. you deserve this.

    • rob barratt says:

      What size jack boot do you take with that Rusty?

      • Rusty Penny says:

        Sans-culottes wore sabots (clogs).

        Let’s go with that…. or are they oppressors too?

      • rob barratt says:

        I thought Doc Martins might be more comfortable? They’re certainly better in a street brawl.

      • Rusty Penny says:

        20 people walking a solitary person to a guillotine, or placing their head on a block above a machete, isn’t a brawl.

        You don’t need to reminisce so much about the latter, parts of Indonesia had them in 1998 during the financial crisis, and they’re nicer people than we are.

      • migtronix says:

        @rob barratt: sure why not, docs, fred perry polo, vivien westwood jackets — its all coming back, like misery…

    • Ronin8317 says:

      The history or violent revolution is not good. The people who are willing to commit violence to gain power just wants to be the new guys at the top, while the unfair system remains in tact.

      If all the readers of Macrobusiness joins together and form a political party, there would be enough clot to change policies. Finding a person that can represent the movement who is both willing and electable is another matter.

      • Rusty Penny says:

        American Revolution?

        French Revolution?

        Serf uprisings of the Germanic states 1848?

        These aren’t tyrants replacing tyrants, these are the masses cutting away the cancer.

      • Arben says:

        +1 Ronin
        A political party is what is needed. The question is how can it be done (if you don’t have Clive Palmer’s resources)

      • interested party says:

        “If all the readers of Macrobusiness joins together and form a political party, there would be enough clot to change policies”

        You plan will take generations to fulfill. You will need to wait for enough of the buggers ( read this as anyone with a vested interest) who have their snouts in the trough to die out to bring real change, where as Rusty’s plan kind of brings that change forward a bit.
        Revolutions are most often followed by a void…that gets filled by ‘strong men’ of sorts who resort to violence to maintain control. Read Orlov to get an idea on this process. The revolution is mainstream folk fed up with the status quo and they are not given to forward planning. Once the emotional purge has run it’s course….no plan…..then the real fun begins.
        My money is on no revolution, no housing crash, just more of the same. Business as usual, folks.

      • Rusty Penny says:

        You plan will take generations to fulfill. You will need to wait for enough of the buggers ( read this as anyone with a vested interest) who have their snouts in the trough to die out to bring real change,

        ben Chifely noted that the ALP (in his time) was the party of eternal reform, and that due to voicing reform would tend to find itself in opposition more times than in power.

        For change to be implemented in the future, a party would have to start now and be content for 30 years of ridicule, marginalisation and being in opposition.

        Competing against them will be current youth who don’t want 30 years of struggle, and join the gravy train instead, so in 30 years time they supplant the buggers who drop off. The power structure remains the same.

        People who impose tyranny over you, need to be afraid of imposing tyranny over you.

        That is the reason behind the US’s second amendment, it wasn’t borne out of a convenient substitute for a bottle opener.

        Boomers are oppressing the youth here, and much of the OECD world, and they need to be afraid of doing so.

      • interested party says:

        RP,
        “Boomers are oppressing the youth here, and much of the OECD world, and they need to be afraid of doing so.”

        I do agree with you sentiments in total….I just believe that this process will take time to evolve. This ‘boomer’ generation is in control of every department of our society and economy. They guide policy in defence, police, government, and welfare. For your change to occur we need to control policy, and that will take generations ( unless we start swinging/dropping blades). Having said that, I am not of the belief that a political party is the answer. Far from it. Remove the concept of ‘party’ and then you have my ear.

        edit…
        “Competing against them will be current youth who don’t want 30 years of struggle, and join the gravy train instead,” …..so you can discount this mob in your revolution numbers then?

  20. HealthyInvestor says:

    Did anyone really expect anything else from this budget other than the richest to protect their wealth lololololol

    This is what politics is baby! It’s the worlds largest business and they will look after their majority voters and donators fist and foremost. That’s their shareholders.

    People often think government is seperate from business but it’s not. If you want to be a socialist or communist you can move to another country. See how that works out for you.

    • Rusty Penny says:

      Australia’s most prosperous era was when it was markedly socialist.

      Truman and Eisenhower had the US rather socialist by US standards as well during the same era.

    • migtronix says:

      But fascism is OK? How’s it working out?

      BTW how do I get the NSA to follow my Twitter account? Oh!… Wait…

  21. willy_nilly says:

    All boomers are not alike. vast inequity between the cohort.

    http://www.thechronicle.com.au/news/nations-baby-boomers-still-working-fund-retirement/1728584/

    Some workers have done very well from the super system, but it is increasingly emerging as a case of the haves and have-nots. Simon Kelly, an associate professor at the National Centre for Social and Economic Modelling, a research centre at the University of Canberra, said the average super account balance for males aged 60 to 64 was just $135,000. For females it is less than half that, $62,000. These are well short of the sums needed to fund a comfortable retirement.
    But the ”average” is skewed by a minority with very large super accounts.
    Advertisement
    Mr Kelly said the median balance for men – the middle figure when you list all the account balances from top to bottom – is $33,000 and for women it is zero. That’s right: at least half the women in this age group have absolutely no super.

    Read more: http://www.smh.com.au/business/baby-boomers-face-going-into-retirement-saddled-with-debt-20100323-qu5n.html#ixzz30WSSECtc

    • migtronix says:

      Tell us something we don’t know! Like what’s the inequality between the boomer cohort and, oh i don’t know, millis… but not now of course that’s silly, compared to when boomers were that age. Fuel costs, education costs, rent costs… Mmmmm

    • Rusty Penny says:

      The problem is the boomers are playing an ugly, greedy game.

      It’s a game that is punishing those younger than them, and they continue to ignore the cries of those youth that the burden is now too much.

      However, it doesn’t mean they will win the game.

      bankers will win, sure.

      But the carrot is ‘play this game of punishing youth, and there’s a chance you will win BIG’.

      Boomers are happy to do that, narcissism frames their gratuitous pursuits above shelter and children of GEN X/Y.

      They’re too stupid to understand how debt potentially makes them losers, hence their levels of debt,and what they’re facing.

      Boomers are vile not so much out of outcomes, but intent. They are happy to cripple their kids out of greed.

  22. David Barnes says:

    I was born in 1946. Do I qualify as a bludger? Reverse mortgage. Are you kidding? With compound interest doubling your debt every 10 years. By the way, some of us older parasites would also like to leave our kids something as well. Yes house prices are too high for young folk on average wages but some of the policies suggested here if implemented would help fix this in the longer term. Our parents went through the Depression and WW 2 and I can’t ever remember hearing them whining about how hard done by they were. As for running away overseas, that’s pathetic.Ends rant.

    • Rusty Penny says:

      here we go….. I died in 3 world wars and climbed up the hill both ways in the snow to walk to school….

      I was born in 1946. Do I qualify as a bludger? Reverse mortgage. Are you kidding? With compound interest doubling your debt every 10 years.

      That’s not how interest works.

      At 5%, 250 bp above the cash rate, its 63% every 10 years chicken little.

      By the way, some of us older parasites would also like to leave our kids something as well.

      That’s not a god given right, you’re looking at this as an entitlement.

      It is not costless, and is borne out of a cost now embedded.

      Yes house prices are too high for young folk on average wages but some of the policies suggested here if implemented would help fix this in the longer term. Our parents went through the Depression and WW 2 and I can’t ever remember hearing them whining about how hard done by they were.

      Your parents generation were noble, not vile.

      Complains aren’t made when sacrifices are made across the broad community.

      Large scale efforts were made in the war effort, the depression had wide scale suffering.

      Today is your lot making out like bandits and the rest of us suffering.

      We’re complaining because we’re carrying too much of the burden compared to your generation, not because there is a burden to carry.

      As for running away overseas, that’s pathetic

      Why is it?

      Gen X/Y are the most valuable resource to this community right now, we’re the ones working that provides everything.

      Others may give us a better exchange for our efforts.

      What is pathetic is your lot thinking you’re entitled to our efforts.

      • Nunatak says:

        Gen X/Y are the most valuable resource to this community right now, we’re the ones working that provides everything.

        I think it might be about time for you to try the bucket of water test, Rusty.

        And while you’re pondering the result, you could also reflect on the fact that there are tens of millions of educated, hard-working individuals throughout the world who will be lining up to take your place, take advantage of the many opportunities that still abound in this country, and prosper in the society you so deeply despise.

      • 3d1k says:

        Well said Nunatak.

      • Rusty Penny says:

        That’s the same as opposing CSG protestors yeah?

        “The table water is still drinkable, cleaner than the water than many other people around the world drink, they would line up to drink your water.. so stop complaining about CSG”.

        Shaming tactics are nothing new.. inferring I’m neither working hard, nor taking advantage of opportunities yeah?

      • Nunatak says:

        Rationalise it any way you like.

        The facts remain.

      • Rusty Penny says:

        ‘The facts remain’

        You didn’t introduce any ‘facts’.

    • 3d1k says:

      Sadly David, this thread has attracted the usual crazed element of malcontent moaners who are in no way representative of the majority of their generational cohort – you know – those other ones that are getting on with life: jobs, housing and happiness.

      • Rusty Penny says:

        Are you asserting our discontent is due to us not owning homes, not having jobs and not being happy in our personal lives?

      • LordDudley says:

        Earlier in the thread I pointed out that about 20% of Australian born are permanently emigrating, and they’re the most skilled part of the population.

        Once mining capex turns down, unemployment increases, and Abbott and his cretins jack the cost of higher education even more, we may well see the number jump to 1 in 4. I’m guessing you’re OK with that as your boss Gina can just tell Tone to import some workers from the third world for $2 per day.

        Happily, there’s a silver lining. Based on the polls, looks like Australians can no longer stand your crony-capitalist masters and are likely to demand something better very soon.

    • LordDudley says:

      “As for running away overseas, that’s pathetic.”

      Oooh, a nationalist. More typical bogan ‘Australia; love it or leave it’ rubbish.

      My wife and I used to pay about $60k per year in income tax alone. Never mind GST. You know how much Australian tax we pay now? None. GST? None. Spending in the Australian economy? None.

      Last year, 43,423 Australians did likewise. That’s about 1.3 billion in income tax alone leaving the country. PER YEAR. Never mind the effects on the skill-base.

      You can call us pathetic all you want. We don’t care. That’s one thing about leaving a country; you no longer have to put up with the redneck nationalists of that nation (except online).

      Hopefully Australians will vote for politicians that implement policies that actually benefit the nation, then the flood of emigrants will slow, and many will come back.

      • Rusty Penny says:

        As I’ve been saying for 2 years.

        You cannot reason with them.

        You have a better chance teaching a chimpanzee to solve a Rubik’s cube.

      • Bluebird says:

        Ironically you two bit piece of shit infant the rednecks have the answer. Smaller government that gets out of the way of building more houses and units.

        Thank god you’re not in Australia and fucktards like you only populate our inner trendy areas. Please stay the fuck away.

        Oh 42k people leave per year and we get 300k or so immigrants to replace you and then some. Sounds good if it means there’s less of you and I bet that’s got boomers quivering in their boots.

        Funnily enough I’ve never come across an immigrant who is some sick deranged PC nutjob. It’s always whiteys.

      • Rusty Penny says:

        You off your meds?

      • migtronix says:

        @bluebird Funnily enough I’ve never come across an immigrant who is some sick deranged PC nutjob. It’s always whiteys.

        O’Rly? And you get all that as you flick them a few #crumbs for doing the cleaning?

      • flyingfox says:

        @bluebird

        Funnily enough I’ve never come across an immigrant who is some sick deranged PC nutjob. It’s always whiteys.

        We should meet … Will cure all your misconceptions about immigrants.

    • Mav says:

      but some of the policies suggested here if implemented would help fix this in the longer term.

      Ha! Mention those policies to any of your baby boomer peers and they will scream bloody murder, vowing never to vote for the party that will implement those policies.

      And you wonder why boomer bludgers are clubbed together as the greedy generation (with some exceptions).

  23. David Barnes says:

    @ rob Barrett. That’s it mate. Serve it up to these spoilt pricks. I’m sick of this lumping all people over a certain age into an homogenous category and then labelling and blaming them for societies perceived ills. It’s wooly thinking at its worst and not what you would expect on a sit like this.

    • Rusty Penny says:

      Your generation is taking money from our generation.. and we’re spoilt pricks….

      ohhh the ironing.

    • 3d1k says:

      @DavidBarnes +100

    • LordDudley says:

      Sorry Mr Barnes,
      By quarantining a specific age cohort from suffering any effects of structural adjustment whatsoever, it is the Audit Commission that ‘lumped people over a certain age’ into a category; a privileged category.

      The bile on this forum is simply a predictable reaction to that. And you’re going to see more of it.

      • Rusty Penny says:

        it is the Audit Commission that ‘lumped people over a certain age’ into a category; a privileged category.

        What is more galling is that they have been the most privileged their entire lives.

      • migtronix says:

        @Rus What is more galling is that they have been the most privileged their entire lives.

        Yup!

        But think of the posties…

    • Nunatak says:

      …..and not what you would expect on a site like this.

      Spot on, David.

      “Economics analysis” indeed.

      Come to Macrobusiness and vent your spleen….we’ll provide you with the catalyst….to hell with analysis.

      • Rusty Penny says:

        The gift that keeps giving….

        You’re now accusing MB of biased analysis for the purpose of invoking discontent?

        In a sane world, this is called narcissistic injury

        “You can’t say that about us.. we’re.. we’re.. we’re the baby boomers!!” with a quivering lower lip.

        if something is stated you don’t like, there must be something wrong with the analysis.

        Nothing wrong with perfection ehh?

      • interested party says:

        It’s called ‘passion’ and out of that does come good change.
        RP is correct in much of what he is saying and to disagree is to have your head in the sand. It is wrong to throw all boomers into the one category…however..as the thread topic is about the ‘audit commission’…..it is this that has thrown boomers as a generation into the fray.
        Apart from the vitriol sprayed about, the thread has been educational from my perspective. There are some very interesting times ahead when the passion displayed here spreads to the city streets.

      • 3d1k says:

        IP – yeah right – I too vaguely remember Occupy.

      • Rusty Penny says:

        It is wrong to throw all boomers into the one category

        When I was younger and single, I said to a feminist that I was a guy who admired good shoes, and I would like to buy a girlfriend a pair of shoes.

        She replied “Not every woman has two feet”.

        By the same logic, I was ‘wrong’ to lump all women into the one category.

      • interested party says:

        “yeah right – I too vaguely remember Occupy.”

        3d,
        only noting the clear divide surfacing. Not playing the man…or the message.
        Generational change is happening…..just an observation. Blind if you miss it!

      • interested party says:

        RP,
        My old man never played the market, nor bought RE as an investment. He provided a home, an education, and has only just stopped working at age 75. He worked for himself for most of his working time.

        Not all boomers have their noses in the trough. As a generation..yes.. but individually?

      • Nunatak says:

        You’re now accusing MB of biased analysis…..

        Hell, no….I’m not accusing them of biased analysis.

        Just no analysis.

      • migtronix says:

        @3d: funny, vaguely is apparently very clear in your mind. Curious that?

      • Rusty Penny says:

        Not all boomers have their noses in the trough. As a generation..yes.. but individually?

        Well you can’t make policy at an individual level, only a class (generational) level.

      • interested party says:

        So maybe since you are not making policy here, you can tone down the conversation a little.

      • Rusty Penny says:

        Afraid not, the time for consensus out of mutual respect is over.

      • 3d1k says:

        @IP I’m not a boomer, neither are my siblings, many work colleagues or friends – I see no evidence of the malevolence directed toward boomers in particular and society in general that I see daily in the MB threads.

        MB has attracted a small but noisy extremist element. They can be entertaining but can’t be taken seriously.

      • Rusty Penny says:

        Yeah, but who are you?

        Some of us are more than consumers, we are (were) dedicated citizens with ambitions to ensure continued prosperity for Australia.

        You’re a malignant lifeform whose vocation involves the degradation of long term Australian prosperity for 30 pieces of silver, quote the antithesis of a citizen.

        You don’t have the vein of a dedicated citizen running through your body, and all your posing is about the preservation of the status quo.

        Why would concerned citizens pay attention to you?

      • migtronix says:

        @3d difficult to take you seriously sounds like you prefer to hang with #fiberalfail party stalwarts.

        They’re pro boomer? Shocker!

      • Nunatak says:

        …I see no evidence of the malevolence directed toward boomers in particular and society in general that I see daily in the MB threads.

        Likewise, 3D.

        “Suppose they held a war, and nobody came.”

      • Arben says:

        @ rusty
        While your anger is justified, revolution just ain’t gonna happen in oz.

        Besides which, you might recognise that many institutions in Australia still work reasonably well – e.g. the judiciary (for the time being).

        What we are dealing with is vested interests controlling a senescent political and media establishment. The Lib-Lab Flim-Flam

        Generalised attacks on an entire generation is not an adequate response to the problem – in an earlier post you acknowledged that the existing power structure will remain intact over time, as younger opportunists move into the positions of power gradually relinquished by retiring boomers.

        Perhaps leaving is a good option for some. I believe Sweden once had to ban emigration when the country’s population fell to about 1 million.

        For those that stay, political organisation is required. That’s the challenge, if you want change. One of the achievements of those in power has been to atomise and neuter opposition. Witness 3d1k’s attempts at marginalisation on this thread.
        But it may not take a long time for an organised group to get influence, because the problems are real, and will become more acute.

      • migtronix says:

        @Nuna

        “Suppose they held a war, and nobody came.”

        Suppose they came for their pensions and nobody paid? 0.o

        EDIT: You’re wrong Arben — marginalisation is what we want, all you need is 5% really pissed off, knowledgeable about what they want

        The sole reason Charles I assembled Parliament in 1640 was to ask it to pass finance bills, since the controverted taxation of ship money was unpopular, and since the Bishops’ Wars had bankrupted him. Instead, the Parliament quickly proceeded to impeach William Laud, the Archbishop of Canterbury, of high treason, on 18 December.[4] John Finch was impeached the following day, and he consequently fled to The Hague with Charles’s permission on 21 December

        Sound familiar? Lots of things “worked” then too…

      • Rusty Penny says:

        While your anger is justified, revolution just ain’t gonna happen in oz.

        I am consigned to that.

        As I said to mig above, I’m actually not sitting at my keyboard frothing and biling whilst my fingers thunder down on the keyboard.

        The nest I started has made mention violence is the only thing that will change it.

        It won’t, violence won’t take of, and the same will remain. I finished that nest with ‘you deserve it’

        The boomers don’t even admit they are taking too much of the pie, let alone prepared to sit down and come to a consensus of how to rectify it.

        There will be no ‘cross table agreement’, no ‘action-item list’.

        it will justbe ‘take, take, take’ by the boomers aslong as their voting powers allow them too.

        They don’t recognise this as wrong, nor unfair, nor dishonourable.

        They are the most selfish generation in history, that can’t be argued.

        They are the most narcissistic generation in history, that can be argued.

        The western world used to work 6 days a week prior to WWII, post WWII saw 40, then 37.5 hour working weeks, only to be reversed once boomers owned shares. By that you can argue that they are the laziest generation in history.

        A class of people full of vice, who views themselves as virtuous.

        As I have stated, you can’t reason with this.

        Now I know for the most part, this will be dismissed, and it will be viewed as ill-conceived on my behalf…

        but when the next tax take from the young to the boomers occurs, and it will.. there is always more to take….

        when the next exclusion from burden will be applied to the boomers, and no one else.. and it will.. it’s always someone elses responsibility in the eyes of a welfare dependent…

        perhaps a seed will sprout, and emphasise resistance an iteration earlier than it otherwise may have… I don’t know.

        Me personally, as I disclosed I looked at emigration to Malaysia last October, wasn’t 100% convinced.. however I could probably afford to retire there in about 4-6 years on a middle class standard of living. if Anwar manages to get voted in, let’s see.

        I’ll be early 40′s with child(ren) below 10, not too bad.

        I’ll leave you lot to deal with the next boomer grab.

        You’ll deserve it.

      • interested party says:

        3d,
        “I see no evidence of the malevolence directed toward boomers in particular and society in general that I see daily in the MB threads.”
        Granted that this is not mainstream..and I wonder if mainstream actually cares.

        RP,

        I respect you for your stand…as I respect OP8 with regards to usury. There are many angles here at play and to attack one message only is to miss the big picture. Think about what has enabled the boomers to gain such a significant advantage over younger generations and you can see that this divide between the haves and have-nots was always going to surface. Every generation up to this one has enjoyed a better standard of living compared to the prior one….enabled by loose money and cheap energy. This is over. So the last generation to enjoy that lifestyle will try to cling to what has been, while this generation will struggle to come to terms with reality. It is no surprise that some of the busiest threads here are about youth and inequality. It was always destined to happen and we are living through it. It’s not for me to say if it is right or wrong….it just is what it is.

      • Rusty Penny says:

        Think about what has enabled the boomers to gain such a significant advantage over younger generations and you can see that this divide between the haves and have-nots was always going to surface.

        The issue isn’t that it has arisen.

        I well and truly understand the self-interest at play.

        But they’ve been sprung now.

        They’ve been caught with their hand in the cookie jar, yes cookies are yummy, own your mistakes, your gain will be grandfathered sure, but FFS, you are caught, at least have some honour.

        That’s is what irks.

        Every generation up to this one has enjoyed a better standard of living compared to the prior one….enabled by loose money and cheap energy. This is over.

        I don’t think that reversal is as detrimental as you. The replacements are close to maturity and at a price point not too costly. A burden will occur, and guess what, very few complain abuot the burden if shared equally… but I think we know who won’t shoulder any burden if that adjustment is any time soon.

        So the last generation to enjoy that lifestyle will try to cling to what has been, while this generation will struggle to come to terms with reality. It is no surprise that some of the busiest threads here are about youth and inequality. It was always destined to happen and we are living through it. It’s not for me to say if it is right or wrong….it just is what it is.

        Well in the same way… the right to life….is not a natural law.

        it’s a social construct.

        We agree, buy consensus, to not drag the old person out on the street, cut their head off and loot all their material wealth.

        To enforce that, is a force dedicated to policing against such behaviour, and enforcing penalties against violations.

        All social constructs, which involve behavioural adherence… consensus. It is a bond reliant on reciprocal transactions and quite easy to break when one, or more, parties feel they aren’t getting sufficient return on their transaction.

        Consensus is no longer in effect.

        btw, when it comes to 3″ d1k’s assertions, I have found whilst not explicit, it is very easy to rile young people up into discontent regarding things. I would assert it is very much simmering below the surface.

      • interested party says:

        RP,
        I get the consensus bit. I see the problem as more than just a generation passing the bill to the next and tearing up the social contract. It goes much deeper than that.

      • flyingfox says:

        @Nunatak

        “Economics analysis” indeed.

        Come to Macrobusiness and vent your spleen….we’ll provide you with the catalyst….to hell with analysis.

        If you don’t like it …

        Piss the F*** off

    • Arben says:

      @mig
      I don’t know the history, but from what you’ve write, it sounds like political organisation to me? The 5% you mention have to work together.

      @rusty
      The boomers took what they could, and now they want to hang on to it. And they will succeed if they are allowed to, of course. As you say, the anger is simmering – but how to channel it behind specific, reasoned aims?
      Else, as you suggest, it may be better to leave. Selamat jalan.

    • Kalamos says:

      @David Barnes “I’m sick of this lumping all people over a certain age into an homogenous category”. This is the exact problem we have here. Now the baby boomers are old they all want to be lumped into the category of “Aged Pensions” and bludge off the Australian taxpayer.

      Yes, Generation X and Generation Y should support de-lumping them by bringing change to the pension so that:

      * Those who are asset rich need to pay for their services – if not now, when their house is sold eventually (similar to the HEC system).

      * Those who have significant incomes already should have their concessional access to PBS revoked and they should not receive any pension top-up.

      * Those who manipulate the pensions test by putting all their money into their home to get the pension are engaged in what is the very equivalent to tax avoidance (to use the baby boomer’s language, a ‘bottom of the harbour’ scheme) and should be held to account.

      * Those who intentionally burn up lump sum super by frivolous spending (e.g. first class airfares, etc.) so they can get the pension when the money runs out should be prosecuted for defrauding the Commonwealth.

      There is a simple way to fix this. Get generation X and generation Y behind a new political party to serve our needs, take control of the senate and put a freeze on welfare to asset rich baby boomers. With the pension costing $40 billion a year, PBS (mostly drained by Aged Pensioners $18 billion) and healthcare costs, HECs-style reclaims from asset rich pensioners can fund significant tax cuts over time.

  24. aj. says:

    Interesting read, and interesting comments. It’s hard I know because they keep shoving their rentier noses in our faces, but I think young people need to just forget about the boomers, they are old and have closed their minds long ago. They live in world of obsessive relative wealth and consumption, and they want the next generation to do this too. And of course this does not include all boomers, but as a block it holds true.

    Some people are fine with renting their life, but if you’re not just find a way around it. Don’t live in Sydney, Melb, Brisbane or Perth, and enjoy one of the cleanest most beautiful countries on earth. If you want to live in a big metro and not pay rent to banks (or their proxies the landlords) you will need a very big wage or familial wealth – just face facts.

    The boomers have always tried to set the trends, if you think that living inner city and sipping lattes is the goods you will find the show crowded. This is where the work lament usually comes in, but actually most areas outside the metros are screaming out for skilled people.

    The boomers may not be at fault for the f..d financialisation of everything, but they were conned by the usury industry on their watch. The last thing the young should do is let them drive our choices on the back of their consumption fashion.

    • aj. says:

      Also, it is open to every Australian to structure themselves as a boomer. Just reduce debt (own your assets) and reduce income, and do a bit of investment tax sheltering with stocks paying franked dividends, very easy to do if you are not in a major metro. You do have to let go of the dream to own one of those giant inner city houses, but that is actually not that hard when you factor in the free time trade- off and the fact that you can move very quickly to a net saving position from a net debt position.

      Reduce pointless consumption and buy fresh food and you can almost run tax free, yet access a raft of middle class welfare, whilst having the time to enjoy the absurdly beautiful country we live in and actually get to enjoy life with your kids (if you have em) rather than locking them away in the child care machine while you devote your life to feeding the usury industry.

      I really do think the biggest issue for generations rent is they have let their lifestyle and consumption trends be guided by boomer trends.

      • migtronix says:

        I know you don’t necessarily mean it that way those are pretty damn bleak assessments, you’re effectively saying doing what the last 4 generations have done before you – bought a house in the suburb you grew up in, sure started at the edge and moved to the core as your wage grows — is no longer available to you or you children unless you yourself become a parasite, and hey, have fun living among parasites.

        Thats fucked right there aj.

      • aj. says:

        Well i don’t get that sense Mig. The rules of the game have changed, generation rent can spend their lives in a debt riddled blur trying to follow the path you suggest or they can change the rules.

        The big cities have been captured by the usury industry. The little landlords are just debt riddled pawns for the banks. Wishing it wasn’t so won’t change it.

        There is only one generation that have done what you suggest, they have sold it as the only option, and they have closed the door behind them. Get busy living or get busy dying.

      • interested party says:

        Best comments of the thread.

        Generation parasite vs generation opt-out.

        Thanks AJ.