tip off

Not transitioning, drowning

Crikey readers talk wages growth, Fairfax deadlines and the coal companies getting government money.

Yesterday’s news

Kim Lockwood writes: Re. “Hearing crickets on the sports pages” (Friday). It’s not just the SMH with an early deadline. The Age — because it’s printed in Ballarat? — seems to go to bed about 6pm. The South African cricket stories are carefully worded (p)reviews.

In Friday’s Age we learned that the hard hitting of Mitchell Johnson had kept the visitors on track — after a night in which Johnson’s bowling had devastated them! They’re a day behind.

On the edge of economic free fall

Les Heimann writes: Re. “Wages non-growth and austerity potential traps for the economy“ (Thursday). Yes folks, once again “wages are too high” is the clarion call of the business moguls as they rattle the cages of their parliamentary underlings; the Australian Tea Party look-alike. One of these, Joe Hockey, currently federal Treasurer, at the Press Club last week extolled his and his fellow conservatives’ “plan” to transition the economy.

Have you heard it before? Get rid of the carbon tax, mining tax, everyone has to help themselves, abolish the age of entitlement, bring back the Australian Building and Construction Commissioner, and when asked just what was his plan to increase employment, well, as he said that he had told us his plan, get rid of the carbon tax …

We have this strange description of the Australian economy that, in reality, is teetering on the very edge of disaster, as being “in transition”. We know where we are, we feel we know what’s in store, and that’s going to be exacerbated by Joe Hockey and his crew, but where are we transitioning to?

If the “plan” by those in charge is to assist in depressing our economy, and with no new industries and no real job creation, then we are not “in transition”, we are about to be in economic free fall.

Increased unemployment means reduced demand, and coupled with a reduction in welfare payments that means the exact opposite of what Labor did to successfully counter the GFC. On top of all this is “reduce labour costs — it’s all the workers’ fault”.

No, it is not. This stupid capitalist assertion that prices follow wages needs to be attacked. There are libraries full of evidence that always in an equal economy wages go up if prices go up.

Wages can and will decrease if prices go down. Prices can go down if profit margins go down. Wages will, of course, go down with rising unemployment. Wait a minute — that’s what this is all about. A conspiracy to bring down wages!

Subsidies for coal

Peter Burnett writes: Re. “Let the market decide” (Wednesday). In comments, Tamas Calderwood says: “The only thing governments can do is stand back and let the market decide — to grow an industry, shrink an industry, innovate and from time-to-time, sideswipe an incumbent.” From that, I presume he is opposed to the government’s massive subsidy of the mining industry (diesel fuel rebates, research and development subsidies, “clean coal” funding, etc). C’mon, let’s see you stick the boot into Gina, Clive and all the coal parasites sucking the government teat.

5
  • 1
    Tamas Calderwood
    Posted Monday, 17 February 2014 at 1:05 pm | Permalink

    Peter Burnett asks if I support “the government’s massive subsidy of the mining industry”.  First, the government doesn’t “massively subsidise the mining industry” – quite the reverse, with corporate tax and mining royalties hugely in the governments favour.  Nonetheless, I’m against all corporate subsidies.  They are unfair, distort markets and are prone to capture by ‘mates’ with the right connections.

  • 2
    JohnB
    Posted Monday, 17 February 2014 at 2:30 pm | Permalink

    TC is playing with only half of the data - again.

    I’ll leave it to others to explain, nicely, I hope, what subsidies and tax relief the mining industry receives and what health burdens it loads onto society.

    Not everything appears on the nation’s published balance sheets.

  • 3
    klewso
    Posted Monday, 17 February 2014 at 2:47 pm | Permalink

    Stand back, the free-market’s going to take another GFC dump.”

  • 4
    Bill Hilliger
    Posted Monday, 17 February 2014 at 3:49 pm | Permalink

    Les Heimann …yes, wages will probably decline under the present govt. So too will discretionary spend on the likes of foxtel, newspapers, magazines, poker machines, pubs, holidays, etc. The spare money industry will run to the govt. for support like a certain airline we used to like. The govt. will then be able to demonstrate how successful they were in bringing the economy of discretionary spend to its knees, I believe its only a matter of time till the Americanisation of low income will be here in the form of food stamps supplementing low wages so low income people will be able to live at all.

  • 5
    Draco Houston
    Posted Wednesday, 19 February 2014 at 12:12 am | Permalink

    Peter Burnett asks if I support “the government’s massive subsidy of the mining industry”. First, the government doesn’t “massively subsidise the mining industry” – quite the reverse,”

    hahahahahahahahahahahaaaaaaaaaaa

    you’re probably the dumbest subscriber to crikey. your letters are only printed to give us something to laugh at

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