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GAP GROWS
“It appears,” the ABC’s Eleanor Hall once reported, “the gap between Australia’s rich and poor is growing.”
It also appears that this process is assisted by public broadcasters converting your taxes into beachfront investment properties.
I personally know several well-off people who claim to be “progressive” and lament the disparities between rich and poor. They are always complaining that poor people cannot afford to buy a home in this area. This did not prevent them, however, from maximizing the sale price of their homes when they decided to move. If they are so concerned about “disparities”, why didn’t they give some poor family a break and sell their home for below market price? Silly question.
Posted by Mystery Meat on 2005 10 30 at 11:16 AM • permalinkA couple of times, Tim, you’ve nearly given me keyboard accidents with coffee coming up my nose with laughter. This time reading of La Hall, it was spew.
Posted by Susan Norton on 2005 10 30 at 11:33 AM • permalinkSo having an investment property means rules one out of bemoaning the obscene wealth accumulated by such tax avoiding uber capitalists as your boss Kerry Packer?
Tim, you’ve been on the ABC payroll yourself, so its surprising to see you begrudge a fellow trough snouter some beachfront arbitrage action. I thought aspirational property investors such as Eleanor would be just the sort of demographic you’d like to see dominant at the national broadcaster…
Posted by Miranda Divide on 2005 10 30 at 12:39 PM • permalinkSay I make $50,000 per year, and my neighbor makes $100,000. If I get a $10,000 raise, and he gets a $20,000 raise, the gap between us has grown. But I’m still making $10,000 more than I was before. That my neighbor makes even more is irrelevant.
To be fair, if ALL your neighbours get a $20,000 raise, and you only get $10,000, you could be priced out of some markets because you’re the only one who can’t afford a price hike. But
a) AFAIK that only applies to luxury goods, not the basic necessities of life or commodities such as TVs, and
b) the great majority of the people who whine about growing income inequality act as though 99.9% of the population are poor and on top there’s this infinitesimal number of “rich” people, so this objection doesn’t apply to their line of thinking.
Dave S. - agree completely. In addition to failing to quantify the actual well-being of any one, this irritating little meme also fails to recognize that most individuals move along the scale over time. That is - the people earning least and most today are not likely to be the same people earning least tomorrow. The article even supports this by spelling out that young people with no kids are probably worse off than older people with kids. While it is possible that in 20 years, those same lower-end people will have no kids, it is not possible they’ll be classified as “young people” and statistically would be most likely to have moved beyond the lower end to greater affluence.
Miranda Divide—Call us when Philco Adams sells his art collection to house the poor. Until then, it’s just a pose.
Posted by richard mcenroe on 2005 10 30 at 02:04 PM • permalinkAnd Miranda, how can you complain about the housing bubble here and diss Tim for calling Eleanor on it here?
Is this a lefty “I’ll say anything to win an argument”?
Posted by richard mcenroe on 2005 10 30 at 02:13 PM • permalinkSo having an investment property means rules one out of bemoaning the obscene wealth accumulated by such tax avoiding uber capitalists as your boss Kerry Packer?
The point you and your ilk fail to grasp, Miranda, is that just being a middle-class Westerner makes you obscenely rich by world standards. So it rings a bit hollow when you bemoan the “greedy rich”, when you (and me, and everyone else here) ARE the “greedy rich.”
For someone in the 95th percentile to rightously condemn those in the 98th percentile is fatuous.
For 99th percentile celebrity socialists like Chomsky and Moore to condemn the 96th through 99th is hypocrisy so oversized it should be criminal.
You can critcize your fellow fatcats all you want, but it will ring a bit hollow if you’re doing it on a computer in a comfy home.
“The rich get richer and the poor get poorer” BECAUSE the rich keep on doing the things that make them rich, and the poor keep on doing the things that make them poor!
Posted by nofixedabode on 2005 10 30 at 04:13 PM • permalinkAnd Warney has 500+ test wickets and I have none.
Waaaaaaaaaaaa!Inequality, I say. Government needs to intervene right away…
Posted by Flying Giraffe on 2005 10 30 at 05:02 PM • permalinkI think you’ll find that Hall is wrong anyway. While a general statement about “rich” and “poor” is hard to quantify, the last figures I saw suggested that the gap between highest an lowest income earners has not changed much or has in fact narrowed slightly while Howard has been in power. Of course it can depend a lot on how you slice the data.
I think that it was Voltaire that said something like, “the law, in its majesty, forbids both the rich and the poor from stealing bread, sleeping beneath bridges and (somthing else which escapes my memory)”.
Anyway, the “growing gap between the rich and the poor” is a statistical artefact of a Bell curve distribution of income. That is, assuming a variation in income (which Socialism evidently is striving mightily to forbid), and distibution in a ‘normal’ fashion (i.e. more or less equally around a mean), then IF the highest income earners increase their income THE GAP GROWS EVEN IF THE POOR INCREASE THEIR INCOME BY THE SAME AMOUNT.
Thus, in the assumption above, if the bottom quintile increased their income (as individuals—i.e. moved up the ladder past some others) by the same amount that individuals in the highest quintile increased their income, the result would be a new curve shifted to the right (i.e. EVERYBODY would on average be wealthier) with a higher mean, BUT IN WHICH the GAP between the highest and the lowest would be greater than previously.
This is great for Socialists, because, if you allow variation (no matter what it’s based on), then even generally increasing wealth automatically increases the gap between the highest and the lowest. Thus, you always have losers at the bottom, even if they’re very, very wealthy losers.
Try it by hand and see. Take 10X everyone’s income in absolute terms. That is, everyone is 10 times as wealthy as before. The poorest person in the land may make 0 dollars still, but those making 10,000 now make 100,000 (in absolute terms, so they can afford anything an earner making 100K now, I’m not allowing any inflation—absolute dollars) and are ‘wealthy’. Those making 1M dollars are now making 10M. The curve shifts very sharply to the right (the average income goes up by 10) and the gap grows at the same time.
The same thing happens, by the way, if you just increase everyone’s income by an absolute 100,000 per year. The average goes up and the gap grows. It’s a statistical anomaly.
Socialists would prefer everyone to be poor with no difference in income/wealth, or so they say, to everyone being wealthy but having differing incomes for any reason at all.
If we can just keep them off our backs, everyone in a mostly freemarket, capitalist democracy will be very wealthy in just a few more years. Much like the poorest in the US, Oz, GB, Japan are today wealthier in many real terms than was Queen Victoria (the wealthiest person in the world in 1900) who couldn’t buy an iPod or Nikes or anti-bacterials or tv or a computer.
Posted by JorgXMcKie on 2005 10 30 at 06:04 PM • permalinkMuch like the poorest in the US, Oz, GB, Japan are today wealthier in many real terms than was Queen Victoria (the wealthiest person in the world in 1900) who couldn’t buy an iPod or Nikes or anti-bacterials or tv or a computer.
Jorg, being a leftist means never having to say you’re happy.
It means saying, “Everything sucks! Why doesn’t somebody do something about it with lots of somebody else’s money!”
Say I make $50,000 per year, and my neighbor makes $100,000. If I get a $10,000 raise, and he gets a $20,000 raise, the gap between us has grown. But I’m still making $10,000 more than I was before. That my neighbor makes even more is irrelevant.
Actually you both get a 20 per cent raise.
If wages were frozen, other than for an inflation adjustment, the gap between rich and poor would continue to grow in nominal terms. In real terms there is no change.
#16, Francis H, you’re right: according to NATSEM (leftie economists) the gap between rich and poor has stayed the same over the last ten years. I recall the spokesperson sounding completely surprised - but kudos to them for actually reporting it.
The growth in real incomes for the poorest Australians over the last ten years has been pretty high (over 20% from memory) - especially when you compare it to the ‘results’ achieved under the last Labor government.
Posted by Art Vandelay on 2005 10 30 at 08:27 PM • permalinkI think that it was Voltaire…
Anatole France: “The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread.”
You mean to say you really expected anything else but bare-faced duplicity and hypocrisy from a vaccuum-head yammer artist slurping six figures of other people’s money a year to tell them what insular, uncaring bastards they are?
The 27 dingbats who actually listen to the daft cow thrive on that sort of aural disciple action- it’s like the lefty/hippy version of English ex-pulbic schoolboys playing the Panzer commander and the milkmaid.Socialists should reflect that there is good reason for Envy, the fundamental basis of socialism as Rob Reed said in #6, to be one of the seven mortal sins.
Posted by Michael Lonie on 2005 10 30 at 10:00 PM • permalinkEven though this post made me gag, THANK YOU for posting this one Tim!
I just wonder how much more of this there is to be revealed???
No wonder Kerry O’Brien and Tony Jones guard their privacy so fiercely. I don’t suppose we’ll see either of them on the ABC’s Australian Story program discussing their lavish life-style. Rich people don’t bother me in the slightest. I’d like to be rich. Obscenely rich Marxists on the other hand, thoroughly DISGUST me!!
Anti-capitalism, anti-consumerism, anti-commercialism…God only knows what they want with all that filthy lucre!ps…Man!! What a view!!!
I find it very strange that an economist woudl talk about income distribution without referring to the Gini coefficient(economic measurement of income distribution). But to save them the hassle of looking foolish, i will supply the data:
1994 : 0.32
1995 : 0.31
1996 : 0.309
1997: 0.322
This information was taken from here.
(ABS)
The last time it was calculated by our good friends at the ABS, was in 2001. it came in at 0.311, which means that in fact income distribution has been more evenly spread (the lower the Gini coefficient, the more even the income distribution).lastest abs
i am sure, however, that MediaWatch will be all over this obvious error (tongue poking through cheek). Or perhaps when reporting this, she meant that she was becoming richer than the poor people of the Australia?Posted by JSthecorrect on 2005 10 30 at 10:58 PM • permalinkThey shouldn’t be doing it themselves- they’re too stupid. They’re just as likely to walk off the ship while blotto and stick their tongues in the socket to see if there’s power for the plasma; what they need is an enlighten state to organise their recreation and artisitic needs for them, and guide them in the right path towards lumpen utopia- preferably guided by luminaries like Ellie, Dave, Phil and Margo.
I have yet to see a convincing argument as to why it matters that the rich get richer than the poor. Do the rich compete for the same items as the poor? Do the poor care that there are so many rich people now that the price of Gucci has gone up or that you can no longer just walk into the spa without an appointment?
I don’t think so. As to affordability of property: rich people tend to congregate with other rich people. The prices they push up are their own and their peers. At the bottom tier prices have, in real terms, gone down over many years. This is not because people are poorer but because of improvements in production. Statistics are obscured by increases in the size and utility of houses.
My point is, who cares?
Highly unlikely- that would require a socialist to have a sense of humour.
The left’s idea of a belly-laff is some idiot in a deformed papier-mache’ head raving about the evils of Halliburton and how Dick Cheney personally puts e-coli bacillus in third-world infant formula, or a shaven-headed lesbian performing poetry with neither rhyme or meter on the plight of endangered lichens being raped by phallocentric chainsaws in some blighted stand of ossified lightning rods; anyone who can sit in a lotus position for three hours or so of that while not hopped up on goofballs or launching a tirade of mockery has serious personality deficiencies.
No wonder they come up with ideas like gulags, year zero and Wartburgs.Ah, Miranda, still barking away, eh? tsk, tsk, I guess you haven’t learned much during your absence, have you?
Eleanor’s whinge about the “growing gap” (see discussion above for appropriate counterpoints) looks like an application of the proclamation from Animal Farm:
All animals are created equal, but some are created more equal than others.
Posted by The_Real_JeffS on 2005 10 31 at 04:38 AM • permalinkMuch like the poorest in the US, Oz, GB, Japan are today wealthier in many real terms than was Queen Victoria (the wealthiest person in the world in 1900) who couldn’t buy an iPod or Nikes or anti-bacterials or tv or a computer.
Toward the end of her life, Queen Victoria would’ve given her kingdom just for access to today’s dental care!
Posted by nofixedabode on 2005 10 31 at 05:28 AM • permalinkPersonally,though not rich but content,I think I would prefer the straight out capitalist Packer than a bunch of hypocrite social worker nimby pinks.
Did ya hear about the Japanese “artist” who was paid five thousand quid by a council in U.K. to drink bucket loads of beer and fall off a beam several times.Local taxpayers not impressed.Heres an analogy:
To compare the left against the right in terms of economic ideology consider the whole of the world’s wealth as a giant pie.Your average leftist sees that some people get more of this ‘wealth pie’ than others, and they consider this to be unfair, and as a result they advocate using government power to forcibly ‘redistribute’ the pie so that everyone recieves a more equitable portion. They tell themselves that they are “standing up for the poor” and so on in order to justify to themselves why they are doing this.
The right, as we all know here, oppose government inteference in people lives in such a manner. The right looks at the same pie and thinks, lets just bake a bigger pie. That way everyone gets more and noone has to lose out. Wealth creation and trade are not zero sum games.
As we are all aware, forcible redistibution in the name of ‘equality’ removes the incentive for the individual to work harder and contibute more, as they will recieve no greater reward, and this is the reason why socialist countries stagnate and often go backwards.
All fairly obvious to everyone here I am sure.
Here is the interesting bit,
As the size of the pie increases, there is only so much one person can eat, as it were, so there comes a point where it doesnt matter how much of the pie your getting, whether it be 10%, or 0.1%, both people will be just as well fed, its just that the guy getting 10% has more left over.Now consider this,
Around 12-18 months ago I read the worlds richest list, Bill Gates was first, with an estimated value at the time of $44.6 Billion.
The guy that came in 6th, dont remember his name, had an estimated value of $21.9 Billion.
The significance of this is that 44.6 is more than double 21.9, meaning that there is a bigger gap between the richest guy in the world and the 6th richest, than there is between the 6th richest and say, some beggar on the streets of India.Yet the difference between Bill Gates and #6 in terms of their standard of living is bugger all, if anything he may even have a higher standard of living depending on how extravagent a character he is.
Just as regardless of how much pie you get, your still just as well fed, it doesn’t matter how much you are worth in financial terms, it is your standard of living that matters most.
#37 Perhaps if she’d watched comedies like Fawlty Towers, Queen Vic might have been amused….
—NoraPosted by The Thin Man Returns on 2005 10 31 at 06:09 AM • permalinkIt’s all based on the fact that wealth is a limited commodity- utter bollocks. It is one of the few things (besides life) which can be created by a bit of well placed effort and investment.
The only bastards who bang on about iniquity and poor-rich gaps are sods who are too bloody lazy to actually do anything about becoming wealthy themselves.
This is the height of hypocrisy anyway, as in western societies they are comparitively wealthy (compared to most of humanity) with no effort on their part.
In such societies, they would be regarded with the veneration they crave, through being ancestors.I have always believed that it is unjust that only people who buy tickets are eligible to win lotteries.
People who win lotteries become rich. If I can’t afford (or just decline) to buy lottery tickets, I am being deprived of an opportunity to become rich through no fault of my own and I am deprived of my inalienable right to narrow the rich-poor divide.
“the gap between Australia’s rich and poor is growing.”
Gah! This moldy chestnut is the MOST MEANINGLESS STATEMENT EVER.Actually, it means something. It means that the general level of incomes is rising. That gap ONLY grows when GDP is increasing. So people who complain about this ... well we know who does that, and why. Leftist asscakes.
Posted by Stoop Davy Dave on 2005 10 31 at 12:47 PM • permalinkAn old one but a goodun -
‘Liberals are always willing to give the poor the shirt off someone elses back’
Posted by IcallMasICM on 2005 11 01 at 01:33 PM • permalinkTake another look at the pictures from new orleans and say one more time that it’s meaningless…
That would be the New Orleans in which most people got out? The one in which local government utterly failed at doing its duty?
Or the New Orleans the press reported from, in which people were killing and eating each other like a mad cross between “Escape from New York” and “Night of the Living Dead”?
Posted by Rob Crawford on 2005 11 01 at 02:19 PM • permalink45 keithh
Take another look at the pictures from new orleans and say one more time that it’s meaningless…
Rising INCOME LEVELS, dipstick, not rising FLOOD WATERS.Posted by Stoop Davy Dave on 2005 11 01 at 02:36 PM • permalinkA wonderful demonstration of Stockholm Syndrome blogsheep. Keep aspiring troops, maybe some crumbs will trickle down to you all one day, and all that bowing and scraping to the ruling class will have been worth it - you will have become sodding middle class at last.
Posted by Miranda Divide on 2005 11 01 at 04:29 PM • permalinkHey Moronda, you left out the part where you show us the mistake in our understanding of how incomes become more unequal as general income levels rise. In fact, you left out the part where you demonstrate the slightest glimmer of comprehension of how this stuff works.
Posted by Stoop Davy Dave on 2005 11 01 at 04:42 PM • permalinkNah, Stoop Davy Dave! That’s not Miranda’s style. He/she flies in, and squawks a bit on whatever topic. After seeing his/her argument torn apart logically, we are thus labeled sheeple for not blindly accepting those gems of wisdom so graciously bestowed, and then not following his/her lead into freedom and enlightenment.
Just of Miranda as saying “Blogmire! Blogsheep! Blogmire! Sheeple! AAAWWWWKKKKK!!!”
There’s a reason why he/she is known as Tim Blair’s Blog Parrot™. Mostly because his/her arguments are repetitious, and puts out a lot of crap.
Posted by The_Real_JeffS on 2005 11 02 at 03:40 AM • permalinkHmp. You know, if I was a lazy ignorant bluffer and moron, that’s exactly how I would behave. OH! I guess I see your point.
Posted by Stoop Davy Dave on 2005 11 02 at 01:19 PM • permalinkDave, let me explain this to you like a two-year old because evidently that is the only level at which you can process information…
Yes, I understand that growth and inequality go hand in hand… The point is that the tradeoff is not worth it ALL the time…. That’s why we have welfare, subsidized education and health, and a minimum wage - getting rid of those would improve growth, but it is not always worth it…
Different countries choose to sacrifice economic equality (for the sake of growth) to different levels, america to a much greater extent than other developed countries… That is why i pointed out new orleans, where many of those at the bottom end of the scale were left behind (eg. because they had no car to leave in)... I don’t know what you think, but for me the level of inequality in america is too great, as new orleans showed….
Whether you agree with that example or not, you can’t make out that any discussion of economic inequality isn’t worth having because it sacrifices growth, because we make those sacrifices all the time, and I assume in some of those cases you would be in favour… Are you proposing that we eliminate all the mechanisms in Australia that reduce inequality for the sake of growth? And if not, then stop pretending that it is black and white, that any talk of inequality is stupid because if we focus on that we might not grow enough…
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Gah! This moldy chestnut is the MOST MEANINGLESS STATEMENT EVER.
Say I make $50,000 per year, and my neighbor makes $100,000. If I get a $10,000 raise, and he gets a $20,000 raise, the gap between us has grown. But I’m still making $10,000 more than I was before. That my neighbor makes even more is irrelevant.
Anybody who uses this “growing gap between rich and poor” line needs to be fish-slapped.