This is an emotive topic, and many of the posts it has attracted have therefore been highly emotional. There are two standard jibes: (1) 'I bet Saunders hasn't ever lived on an income this low'; and (2) 'CIS is just a mouthpiece for the capitalist class.' Neither is true. More to the point neither adds anything to our understanding of the issue.
I can understand that some people believe that income inequality should be reduced. I think they are wrong, but I am happy to debate this proposition with them. But what is going on in the 'Australia Fair' report, and many other reports like it, is this egalitarian agenda is being disguised as an anti-poverty agenda. This is what my article is attacking. If you want to argue for more radical income redistribution, then have the guts to stand up and say it - don't try to smuggle your policies through on the pretence that 11% (or even 19%!) of the population is 'poor' when this claim is patently absurd.
To those who say I have never lived on an income below the half-median income poverty line, I certainly have, and I would imagine many others have too. This was a key point of the article - that the 'poverty' estimates are grossly inflated precisely because they include people like me! In my case, I was a graduate student with two young children living in a rented house on a very low income - but I always knew the situation would improve, which is why it never felt like 'poverty' and did not represent a 'social problem' for people like the Vinnies to get upset about.

It seems that what is lacking from Saunders' side of the argument is exactly how his ideas will help those that are in a tough spot. Or, is it a case that the CIS believes that being in a tough spot is character building and acts as a spur to better oneself?

We're in a Mexican stand-off situation where both sides are firing bullets at each other from their respective ideological bunkers. What's needed is some action that shows understanding of the other side along with a determination to bridge the gaps in society. This requires compromise on both sides.

Peter, look out further than your north shore office.

The longer one is poor, the poorer they get because they are unable to acquire stuff other than food. eg new clothing, decent furniture etc. As you said, Peter, your low-income condition was a temporarry one [being a grad student] and voluntarily chosen. It is not known about what resources you had acquired, before that time, that could carry you through.

We are at a fork in the road. We can return to a welfare system and labor market reguluation similar to Europe, or go on apeing America and see the consequences.

Only thing, the consequences will enrich the bottom lines of your benefactors and rip hope and opportunity out from the bottom, as little as there is anyway.

Yabby,

You have done here exactly what you always do.

You simply restate, over and over again the same assertions, without any regard to earlier arguments in response to those assertions. This serves no useful purpose other than to bloat the size of the discussion and waste the time of others who wish to seriously discuss the issue at hand (see, also, our argument on another forum discussion in response to "Why the Ruddslide?" at http://forum.onlineopinion.com.au/thread.asp?article=6685#100190).

As an example, in another forum in response to my article "Living standards and our material prosperity" at http://forum.onlineopinion.com.au/thread.asp?article=6326#92771, in which you participated, the following point was made:

"... average house prices have gone up, from 3.3 times the median wage in 1970 to 7.4 times in 2005. This must be a major stress on any budget."

It is hardly conceivable that this telling statistic could have escaped your notice and you could hardly have failed to grasp that this, rather than "changed expectations", is the principle cause of OZZYRENTER's acute distress.

This is why it is necessary these days for two, and sometimes three(*), incomes often over mortgage repayment periods extended to 30, 40 years and sometimes even longer are necessary. (Also, this makes complete nonsense of whatever statistics Saunders uses on page 5 of "The Welfare Habit" on which to base his claim that incomes have more than doubled since the 1960's.)

While their may be other factors, the principle cause is property speculators. They are the ones who have ceaselessly lobbied since the 1950's, at least, when Menzies began the process of privatisation of housing to have the Australian economy changed to serve themselves at everyone else's expense.

OZZYRENTER and millions more like him are now paying with their sweat for this policy.

The example of the Housing Trust of South Australia, which provided good quality housing to all layers of South Australian society and never cost taxpayers a cent, is absolute confirmation that the distress faced by OZZYRENTER was wholly avoidable.

---

* I know someone who works two full-time jobs and whose wife also works.

"While their may be other factors, the principle cause is property speculators"

Well so you claim Daggett, totally ignoring the rules of supply
and demand. Speculators generally only live in one house.
They rent out the others. If there were far more houses for rent
then is required by the market, then rents would crash through
the floor. People would be foolish to buy a house, it would make
far more sense to rent.

Fact is that due to migration, we have a major shortage of houses.
State Govts, with their high density planning agenda, have not
released enough land, as the chardonay set are obsessed with the
evils of urban sprawl. Consumers have decided otherwise, they
want houses and McMansions. Cheap interest rates mean that people
can borrow far more to achieve their dreams, so they do.

To build a 3 by 1 bedroom house without too much fancy fandangles
is in fact still dirt cheap. Land it the problem and all the
mod cons are the problem. If Govts insist on charging 300K$
for a small block of dirt, no wonder housing has become unaffordable.
Don't blame the Federal Govt.

Yabby, and you're somewhat ignoring the fact that speculators who buy multiple properties and rent them out need to collect enough rent to cover their mortgages.

I agree that migration is part of the issue, though more as an underlying fundamental than a direct cause (it's the reason speculators get into property, as this guarantees prices will rise).
But that the current taxation structure encourages investors with spare cash to invest, often speculatively (i.e. not adding to supply), into housing, which drives up the prices above what most younger families wanting to get into the housing market can afford.
Most people do not want to live on the suburban fringe, and many young families would be quite happy with a modest 3-BR house with a fairly basic set of appliances and perhaps a few small luxuries - but not even this is affordable in the current market. Our previous house, a small, aging 2-BR weatherboard on a main road, 15km from the city, is now for sale at $550,000, which just beggars belief.

On this basis, it doesn't surprise me in the least that many young families on good incomes feel "poor".