The monster duopoly economy revealed

You want to know why the Australian economy is stuck? Go no further than this chart from Deutsche:

Basically, if you want avoid being gouged, use a truck or go to a shopping centre. Otherwise, cough up.

That is the substitution of liberal democracy with oligarchy that you’re looking at.

Comments

  1. GunnamattaMEMBER

    This is what we were talking about the other day in the podcast – indeed we could do a podcast purely on Australia’s great oligopoly or duopoly gouge

    If Malcolm Turnbull starts calling ‘market failure’ in gas then the next minute he would be listening to a chorus of calls about ‘market failure’ in just about every industry in the land…

    I would go further than the Deutsche chart to include the provision of medical services – and particularly things like imaging, pathology, services like psychology etc…

    Note

    Australia’s earnings revealed: Who is rich and who isn’t?

    http://www.news.com.au/finance/work/at-work/australias-earnings-revealed-who-is-rich-and-who-isnt/news-story/738c1372b3a4e20f36168e097171e77c

    Note this chart

    While I do NOT have a problem with medical specialists earning more, they are in fact getting the bulk of their income from the budget (either directly – through Medicare, indirectly – through a taxing reducing private health system which is underpinned by the public system) and are the largest users of tax avoidance such as Negative Gearing and Trusts.

      • adelaide_economistMEMBER

        Exactly. While a very skilled task, the various specialist colleges are very effective at keeping their numbers under control and their members incomes up.

        They also personally tend to believe they are exemplars of free enterprise when their early education is heavily subsidised, their early training is heavily subsidised and they spend a lifetime being paid effectively due to government regulations and government funding.

    • Just not smart going after doctors tbh

      They “earn” their money more than any other high-income earners, and they have a lot of social and political capital

      Concentrate on attacking wealth not income

      • I disagree. If the income is because of gouging the public purse then it should be gone after.

      • mild colonialMEMBER

        And furthermore competitive, right leaning types should be motivated to maintain their own health to avoid paying too much. . No I am not joking. and left leaning types should be motivated to maintain their health to avoid giving this elite more money.

      • Cracking down on doctors is way down the list of priorities. Yeah, there are a few rorts, but nowhere near as bad the FIRE industries. The insane amount of training required means that many would quit or never bother in the first place if the income in later life didn’t justify it.

        Just to become a a GP, the typical path is a 3 year undergrad degree (in anything), then a 4 year post-grad degree in medicine, then a 2 year internship (foreign students typically aren’t guaranteed an internship as there is a shortage of training positions in Australian hospitals, only Aus and NZ students are sure of getting an internship). In the internship you’re paid about $70-80k and have to do night shifts and work in rural areas and often do unpaid overtime. Then you can apply to be admitted to the GP college (no guarantee you will get in – it’s merit based). If you don’t get in, you stay working as a resident doctor in a hospital for $100kish, with night shifts and long hours. The GP training program is 3-4 more years of study/exams, while you are working full time, and being part of the GP program means more rural training for that 4 years. The NSW GP “regions” are divided into Norther/Southern/Western. So say you get the ‘Northern’ region, you could be asked to work anywhere from North Sydney to Lightning Ridge… I guess at least you know you’ll be north of the harbour bridge. And GP is usually the stream doctors choose if they want “quality of life”.

      • GunnamattaMEMBER

        @Gral

        On the one hand I completely agree with you – it isnt an easy path.

        But on the other hand it is a path which feeds an entitlement mentality [The old ‘I’ve done the hard yards and now I am going to make it worth my while’]

        From there I would also observe that I know 3 foreign doctors working in Australia as GPs without having sat the exam (very expensive exam it is) – and one of these is actually a New Zealand citizen (though originally from elsewhere). That isnt to say they are doing anything wrong – but I would observe that from the experiences of them all as related to me I understand they are encouraged to churn people through the waiting room (sure in the knowledge that Medicare pays), the moment they arent sure of something they are encouraged to send people off for tests (sure in the knowledge that Medicare pays). The people I know (also originally foreign nationals) working privately in the medical system both tell me straight out that a large chunk of their income comes from visiting aged care facilities (again paid for by the taxpayer), and the foreign national surgeon I know (who does both private and public work) tells me that he sees the Australian system as extortionate – with the Australian taxpayers stumping up most of the ransom.

        You also touch on another key aspect of my issue with the medical profession when you note

        then a 2 year internship (foreign students typically aren’t guaranteed an internship as there is a shortage of training positions in Australian hospitals, only Aus and NZ students are sure of getting an internship). In the internship you’re paid about $70-80k and have to do night shifts and work in rural areas and often do unpaid overtime.

        The medical profession (the AMA essentially) limits the number of internships so as to limit the number of practitioners in the marketplace – when the number of practitioners is too low they can either run the immigration tap, or train up the requisite shortfall locally……with the safety gauge on how well they are playing that balancing act the publics ability to pay and preparedness to go to the doctor.

        The other manifestation of how they play that balancing act is the scores required to get into medicine related courses in the tertiary sector. Sure you need to be highly intelligent to become a medical practitioner/specialist – but do you need to be in the 1%? And from there there is the not small issue of who gains the ‘margin’ between the 1% (pretty much reflecting the 99% scores required to get into medical courses anywhere in Oz) and whatever it is you need to actually do the job – currently it is the doctors and specialists.

        Partly my questioning of this reflects personal experience. I have this morning received a quote from an orthodontics practitioner in Geelong for my son for a treatment costing circa 5k. Knowing that he will be overseas for 3-4 from June I contacted someone there about how much the treatment will cost there (in a facility which would rate highly anywhere) and was told about 1500. As someone also going through a protracted treatment (who some time ago was a player in the outsourcing of large numbers of public servants on the basis they were expensive and sometimes had behaviours which werent really focused on outcomes but on themselves) I would also note that (as a privately insured patient) some of these have behaviours which are all about suiting the practitioner (or the staff of the practitioners) and not about addressing the patient, and that the sector in general has a billing process which seems designed to mystify – the classic symptom of an industry looking to gouge – and is averse to questioning.

        Given the position of medical practitioners in both the earnings and tax avoiding rankings and the exponential growth of the medical care requirement (with an aging population etc – again a classic position for a little bit of gouging; the rapidly growing market with a surfeit of demand and an inadequate number of providers) I reckon they are well worth a look.

      • @footsore

        It seems you don’t understand that all Australian dollars start their life from the public purse, except for bank-issued debt.

      • @Gunnamatta you are misinformed

        The AMA does not set or advise on intern positions

        Intern positions are funded by the state governments.

        Additionally, does your experience with orthodontics not suggest that your thinking is completely backwards?
        After all, orthodontics and dentistry in general is not covered by medicare and therefore they are not getting their money from the “budget”?

        Which is itself misdirected, as anybody who earns Australian dollars is ultimately getting their money from the “budget”

      • Gunna
        Just had an op. The anaesthetist had to be paid cash (literally) up front. Policy practice. The a. says they have to charge more otherwise. I’m sure they inform the ATO as soon as the money hits their palm.
        Nice……..

      • Gunna, you’re right about the rorts, especially the churning of patients. Everyone feels that at the medical centre when the GP is rushing you out before you’ve had all your questions answered, so the doctor can get to the next patient in the waiting list.

        I wouldn’t say that’s necessarily the fault of the doctor – sometimes it is, sometimes it isn’t. There are a lot of time waster patients, and doctors often have to rush to make a GP practice worthwhile, or charge a gap, or both. Running on the medicare scheduled payment and doing 30 minute appointments and you wouldn’t bother running a practice.

        As for the specialist colleges bottlenecking the number of specialists. Maybe. But once you qualify in a specialty its hard to get a job, so it’s not like getting more specialists qualified would help. It’s not just a matter of rocking up to your nearest hospital and applying. If there is a shortage – it is a much more complicated problem than the number of specialists. Doctors need facilities and whole teams of people around them and those would need to be built up. Yes there are issues, but I hope the medical industry doesn’t become overly politicised like it is in the US, where both sides know it is failing patients and costing an arm and a leg (no pun intended) but they refuse to fix it.

        I think the bigger problems in Australia are in society – the cost that people have to spend on housing and education, means they don’t actually want (or can’t) pay more for their health. Its the wrong way round and society has gone crazy. So I think MB has the right priorities, focusing on housing, population, and tax.

      • GunnamattaMEMBER

        @Gral

        Cheers for the reply. I am with you, and think the immediate concerns are housing tax and immigration for sure.

    • The Penske FileMEMBER

      agree once you throw in CBA owning Bank West and even underwriting Aussie’s white label. Plus NAB backing 3 aggregator’s WL’s. I always thought that it was closer to 90%.

  2. Unfortunately, we don’t have enough people to support more than two players. There have been plenty of failed companies, one of the three players usually fail.

    • Exactly. A small population but highly concentrated in capital cities just the right distance away from one another means this will always be the case until…Run for your lives macrobusiness, population growth!

  3. innocent bystanderMEMBER

    Economies of scale… gov’t has less people to talk to to be told what It should be doing.

  4. CounterfiatMEMBER

    Solution to fix most of the negative behaviour – Remove the GST and put a Corporate tax on revenue to give the same affect. This will stop the corporate black economy (offshore havens etc). Allow sole traders to trade without this corporate ‘GST’ revenue tax – seperate entity legal benefits for sole trader provided by insurance. Sole traders then flourish.

    • Interesting idea. How will the corporate tax be applied so that it is actually collected? As it is, Australia seems to have enough to taxes, we just seem to have too many exemptions, loopholes and diets accompanying them.

  5. Losers complaining here, again – pathetic.

    Go get a job, mates…. sorry, forgot, losers first have to get a proper education. But, wait, they’re too stupid to get into Uni. Oh, now I see ………… there’s no way out for them – poor buggers they will remain.

    So, what do they do ………somehow, they now feel somewhat heard by other losers who vent their frustration at the status quo that has prevented them acquiring anything. Depressive circumstances beyond which they just cannot rise … Losers they stay.

    Change the system they say … it’s let them down badly …………and ………. they cannot create their own system.

    🙂

    • GunnamattaMEMBER

      Or, if you are underemployed and have a bit of time spare, break into someones investment property and leave them a steamer…..

      The struggle for justice can take some weird forms