The NEXT coming Oz election thread!

Good evening. I've been following this thread for a long time but have not commented for awhile..
I am a bit of an economist so I know enough to be dangerous. It seems to me that Australia is a good precursor for the rest of us in the "developed" world. If that is true, the US economy is going to be in trouble due to excess imports and personal debt.
In addition to economic issues, the topic of "immigration" is going to be huge; not only in OZ, but in the US. Nimh has brought this up in his comments on European politics. -rjb-

This is pretty funny. At a time when labour (not the party) is at a premium JH is trying to knobble it's bargaining power. His only ways of doing this are legislative and/or opening up the borders. I think he's cruising for a bruising either way.

Companies will negotiate around legislation if they are desparate enough for workers. I can't believe their hypocrisy about flexible labour markets, they have middle level bureaucrats negotiating AWAs (talk about counterproductive) and then they want to use a legislative hammer to knock the labour square peg through the employment round hole.


The immigration card would be suicide for the libs to play. Recent elections have shown us just how xenophobic the electorate is, wouldn't there be a massive backlash if suddenly 'boat people' were given our jobs instead of going straight to Baxter? I wonder what spin they're going to put on that, especially as the economy's slowing and the dollar's rising (ie our exports aren't as attractive, therefore demand for labour will drop in manufacturing, precisely where we have a shortage apparently).

Beazle's line about putting the money into education and training makes sense, for a change. Of course conservative governments always cut education spending, only a dumber electorate will re-elect them.

hinge

This (nobbling labour) has been on the cards for ages, hasn't it? One of Reith's favourite obsessions, too. Maybe it's simply a case of screwing the unions because they're able to, come July & a Liberal majority in both houses? Too good an opportunity to miss? But it looks some employers aren't exactly thrilled at the prospect any more than the unions are. Trouble! Should be "interesting" to watch all this unfold!

BTW I'm so sick of hearing about these record employment levels we supposedly have! If you work as little as one hour per week you are classified as "employed" these days. All this talk of prosperity, good times, etc, etc ... I would love to know what the real level of unemployment is! This is a giant hoax.

Yep! Locally produced goods can't possibly compete with those produced far more cheaply in China, Taiwan, etc. There is already a sizeable pool of unemployed unskilled workers in Oz as a result. In the meantime those who can, buy up big ... imported goods, on credit. This must surely be happening in the US, UK, etc, already.

... & how's this as a solution to the shortage of trades people in Oz?:


Drop out and get a trade: PM
Elizabeth Colman and Ebru Yaman
March 07, 2005/the AUSTRALIAN

JOHN Howard has urged young people to consider quitting school in Year 10 to pursue careers in traditional trades as the nation faces a growing shortage of skilled workers.

Sixteen years after the Hawke government promised Australia would become the "Clever Country", the Prime Minister said the nation had developed a "deep-seated" cultural stigma against technical vocations.

Mr Howard said yesterday that school leavers who learnt a trade often ended up much better off than if they had continued on with a university education.

"We went through a generation where parents discouraged their children from trades, and they said to them 'the only way you'll get ahead in life is to stay at school until Year 12 then go to university'," Mr Howard told the Seven Network.

"High Year 12 retention rates became the goal, instead of us as a nation recognising there are some people who should not go to university. What (these people) should do is at Year 10 decide they're going to be a tradesman.

"They'll be just as well off and, in my experience and observation, greatly better off than many others."

Mr Howard's comments come as a new government report, Skills at Work, to be released today and obtained by The Australian, reveals that most of the growth in apprenticeships is in areas where there are no skills shortages.

The Howard Government plans to address skills shortages by boosting skilled migration by 20,000 places, while business and industry has called for more investment in vocational education.

Immigration Minister Amanda Vanstone said yesterday that skilled migration was "obviously a shorter-term solution . . . because training does take time".

"My view is immigration should be there to help. If you need specialists for a limited period of time, we have to have the visa capacity for you to get that," she said.

One of the nation's largest employers, Woolworths chief Roger Corbett, added his voice to the chorus of concern about the emerging skills crisis. He expressed concern that it was getting harder to fill jobs in some sectors with Australia nearing full employment.

But the Opposition and unions accused the Government and business of squandering good economic times, and failing to invest in technical training.

Writing in The Australian today, Opposition Leader Kim Beazley says Australia has a ready workforce that is being "under-utilised".

"There are 570,000 under-employed people working a few hours per week, but wanting more. More than half, 58 per cent of these people, want a full-time job but they can't get one - often because they don't have access to the training that could lift their skills," Mr Beazley writes.

Yesterday, he attacked Mr Howard's plan to establish 24 new technical colleges and called for an "emergency contribution" to training.

"The TAFEs are crying out for money," he said. "Two hundred and seventy thousand people applied for entry into TAFEs and couldn't get it because of chronic commonwealth underfunding of TAFEs."

Australian Workers Union secretary Bill Shorten said unions had been warning business and the federal Government "for years" that their failure to invest in training would lead to skills shortages.

"There needs to be concerted work done by the Government, and by the private sector, to create incentives for private employers to do more training," Mr Shorten said.

Chief executive of the peak university lobby group, the Australian Vice-Chancellors Committee, John Mullarvey, said it was clear the federal Government was shifting its focus to vocational training.

"In the last (Howard) government there was a focus on funding for universities. That focus is now on vocational education and training but that doesn't mean there won't be opportunities for universities."

Mr Mullarvey said it was in the nation's broader interests to have as many education and training opportunities on offer as possible.

"We have never argued that everyone should go to university," he said. "Each year there's unmet demand of about 20,000 to 25,000 - people who are qualified to but don't get into uni. If these people aren't lost to the system but are redirected elsewhere then that is a good thing."

Australian Bureau of Statistics data has previously shown bachelor degree holders earn more than TAFE graduates in skilled vocations, and have higher employment rates.

University graduates also spend less time looking for work than their technical college counterparts.

Australian Education Union federal president Pat Byrne said Mr Howard had "old-fashioned" views on TAFE and university.

"It's a real 1960s view of what schools used to do - the bright kids went on to university and the not-so-bright ones went on to technical careers," she said.

The Skills at Work report on the Government's New Apprenticeships scheme shows 93,830 clerical, sales and service apprenticeships were commenced after the scheme was introduced in 1996 - compared with 52,840 in trades.

The figures also show a slight drop in trade apprenticeships overall since 2000.

Business yesterday had reservations about any policy change that would limit future options for high school children.

"I think there is something in what John Howard says but we shouldn't give up on giving kids a diversity of options," Australian Industry Group chief executive Heather Ridout said.

"I think the Government has relied on the economy turning over on well-oiled wheels and we haven't really been taking a strategic approach to training."

Don't trade down Year 12
Ebru Yaman, Higher Education editor
March 07, 2005/the AUSTRALIAN

IT'S VET, stupid. Vocational education and training is receiving an extreme makeover after years of being run down in funding and in image. Glossy are the brochures that promote life as an apprentice and many are the enticements to small business to take on trainees.

And you don't need a university degree to see why the federal Government has embarked on this urgent spit-and-polish: the Reserve Bank is warning Australia's skills shortage is a threat to the economy.

But when John Howard mounts an argument for not finishing high school it's time to take stock. Promoting trades as honest, lucrative work is one thing, but doing it at the expense of a Year 12 education is a backward step.

A plumber, an electrician and a fitter all need to be able to write and count. In fact, under the Howard Government's complex tax system, small business people need to be more literate and numerate than ever. But do we really want a workforce so narrowly trained?

We know education is the key to overcoming social disadvantage. It's why we sold the university option so hard in the first place. To a generation of Australians wanting more for their children, university was the key to prosperity. Looking back, perhaps we were short-sighted in that over-sell. But a retrenched 40-something worker, no matter what the industry, has little hope of reinventing themselves without a high school certificate.

When I heard about JH's 'drop out in year 10' sound bite from my SO I couldn't believe it.

I can just imagine him giving that advice to his own kids. And then to have the employers say they'd favour a year 12 grad over a year 10. How many more clues does he need that he is completely out of touch with reality?

Get back to the 50s where you belong - very reminiscent of Prince Charles comment about knowing your place.

I wonder how many private school kids end up in trades? Bugger all and it's not because kids in private schools are brighter - it's because their schools are better resourced. For an egalitarian society we have deep class divides.

But it's OK for the OTHER people's kids to drop out at year 10, hinge. Something unthinkable for our prime minister's family, of course! But then, that's how things were in the 1950's, as you say. Them & us.

<sigh>

Consumer confidence rocked by rate rise
March 9, 2005 - 5:09PM/SMH

Confidence amongst Australian consumers has deteriorated drastically in March, from near record highs, following the Reserve Bank's decision to lift interest rates for the first time in more than a year.

The Westpac/Melbourne Institute of consumer sentiment dropped by its biggest percentage movement in the history of the survey, down 16.6 per cent to 102.4 in March.

The survey was conducted just after the central bank raised the official cash rate by 25 basis points to 5.5 per cent.

"The Reserve Bank is likely to treat this result very seriously when deciding its next move on interest rates," Westpac global head of economics Bill Evans said.

"It is an extraordinarily strong reaction by consumers to the rate hike."

The average fall in confidence in May 2002 or November 2003 - both times when a rate hike occurred after a long period of steady rates - was just 1.1 per cent.

However, Mr Evans said other factors, including a weak economic growth reading for the December quarter, compounded consumers sensitivity to the rate hike.

The fourth quarter GDP data was released just two hours after the cash rate was lifted.

Mr Evans noted that consumer sentiment fell by 14.2 per cent in March 2001, after news that GDP contracted in the December quarter of 2000, prompting media talk of recession.

"Last week, growth was reported as an anaemic 0.1 per cent in the December quarter of 2004, following only 0.2 per cent in the September quarter," he said.

"Heavily indebted consumers have sharply revised their confidence, which prior to (the February survey) was near record levels.

"Today's confidence reading is 10.5 per cent below a year ago and only slightly above the long-term average."

The last time confidence dropped so dramatically was in April 1990 where it fell 15 per cent, just ahead of the unfolding recession.

UBS chief economist Scott Haslem said a fall in confidence was probably expected by the RBA, but the extent of the decline would give the central bank something to contemplate as it approached next month's board meeting.

He said, while another rate this year was increasingly a close call, strong credit growth and capacity constraints kept one more rate hike on the cards.

"Slower demand... remains a panacea for too rapid credit growth, capacity issues and the rising current account deficit," Mr Haslem said.

"We continue to look for a further rate hike from the RBA in Q2, most likely next month."

AAP

Jobless figures are out today too. I'm doing my bit boost them.

..... but all you have to do is work an hour next week & hey presto: you're "employed", hinge!

PM bucks world with tax hikes
David Uren, Economics correspondent
March 10, 2005/the AUSTRALIAN

JOHN Howard and Peter Costello have markedly increased the tax burden on Australians over the past eight years, in striking contrast to the sustained period of tax relief enjoyed by taxpayers in most nations around the world.

The Organisation of Economic Co-operation and Development, one of the world's leading economic policy organisations, has found Australia stands almost alone in raising taxes over the past eight years - a period in which most other developed countries have been cutting. Iceland is the only other nation to buck the trend.

Putting further pressure on the Howard Government to pursue more taxation reform, the OECD annual review of the way countries tax wages shows that the poorest people in Australia have suffered the biggest average tax increases.

The average fall in the tax burden in developed countries over the past eight years has been about 2 per cent.

In Australia, the average share of income swallowed by tax has increased by between 1.4 per cent - for a single person with no children earning about $90,000, two thirds higher than the average wage of $53,000 - to 9 per cent - for a single parent with two children earning about $35,000, one third lower than the average wage.

The OECD report shows that the increase in tax has been worst for those who have a mixture of welfare payments and earned income.

The single parent with two children earning $35,000 has seen the tax take go up from 11.8 per cent to 20.7 per cent of their income in eight years.

In the US, such a person would have received a net tax credit of 2.6 per cent in 1996 and a tax credit of 11 per cent last year. In England, a single parent would have paid 11.5 per cent of their income in tax eight years ago, but would today receive a credit of 17.3 per cent.

The Government has struggled to fend off claims from Labor that it is a high-taxing government, and is facing pressure from within its own ranks to lower marginal tax rates.

The increase in the tax burden comes despite the cuts in marginal tax rates in 2000, when the GST was introduced, and several increases in tax thresholds.

However, bracket creep has been pushing people into higher tax brackets.

A spokesman for the Treasurer last night defended the Government's approach: "As the report acknowledges itself, the results for Australia do not allow for change in delivery of assistance from the tax system to payments like the family benefit. The OECD report also does not include the most recent tax cuts and increases in family payments."

Reserve Bank governor Ian Macfarlane recently recommended that the Government reconsider the income tax credit system used in the US and England to ease the problem of high effective marginal tax rates.

The OECD report underlines the problem of high effective marginal tax rates, showing that Australia is second only to Britain in the tax rates it levies on families.

The marginal tax rate reaches 61.5 per cent for each partner for a married couple with two children where one partner earns the average wage and the other earns two-thirds of the average wage.

For a couple with two children where one partner earns the average wage and the other stays at home, every additional dollar of income earned gets taxed at 51.5 per cent.

The OECD said the increase in the average tax burden in Australia is partly explained by the shift of some payments from the tax system to the Department of Family and Community Services.

The OECD says that for most developed countries, the tax burden has been reduced, whether you look at just income tax, income tax and benefits, or the total cost of hiring someone.

I am currently living in Australia and have applied for Permanent Residency.
It drives me crazy that I have heaps of skills but am unable to work!
So I fill my time doing heaps of volunteer work instead.
Wouldn't Australia benefit from my working and contributing tax $$?

Hmmmm - I am sad that we all appear to have bought the rubric that tax = bad.

I have no problem whatsoever paying "high" tax (and I do - I am in that category of poor dumb bastids who hasn't thought of ways/had enough money to get rich enough to not pay tax) if in return I help to support good health care, education, and other important services.

But yes, it is a little bit of fun to see Howard hoist in his own petard.

However, folks, it is early in the term. All will be forgotten by election time - unless we really are in for a nasty recession etc, and there is the usual casting out of the scapegoat...

Although a good tradesperson earns waaaaaaaaaay more than I do - for all my 9 goddamn years at uni and 12 years at a wanky private school!!!!!