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The Forum > Article Comments > Cost of living crisis revisited > Comments

Cost of living crisis revisited : Comments

By Tristan Ewins, published 27/8/2008

Services, infrastructure, wages and welfare: the many-faceted nature of Australia’s cost-of-living crisis.

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Your suggestions are becoming increasingly bizarre, Passy.

>>to mandate the openning up of vacant rooms in hotels and motels (plus free meals)<<

The cost of this would be astronomical.

Think of the complexity of the process.

How would you determine whether a room is available or not. What time of day would you ascertain this? To whom would you allocate the room i.e. against what criteria? How would you arrange transport? How would you pay for it? Who would cover the insurance?

Given that this would necessarily be a day-by-day exercise, how many people do you think it will need to administer and run the programme? To whom would they report, and how would their success be measured?

Wouldn't it be simpler and cheaper just to provide more accommodation as per Kev's proposal?

>>An alternative to trading in LSL might be to have a universal and portable scheme.<<

You may see LSL as being designed "to help workers get a break from the grind of work and bring them back refreshed after a few months off". The employer views it as a reward for ten years of commitment to the company.

Why would I want to reward years of loyalty to someone else?

As an employer, I start accruing LSL on my balance sheet after five years, and encourage that leave to be taken after ten.

If someone fronts up for a job carrying with them nine years of accrued LSL, will I be allowed to take that into consideration?

After all, if he's on $50k, I would immediately have to take on board a balance sheet liability of $13.5k, and only a year later, let him go on over two months of paid leave.

Seems a touch unfair, especially as his previous employer would be able to write back the same amount into his P&L.

And don't even think of suggesting that the liability must travel between jobs. While it sounds superficially do-able, what happens when there isn't an immediate next employer? The opportunities to rort would be legion.

Totally impractical.

You've never worked in business, have you Passy?
Posted by Pericles, Monday, 1 September 2008 11:05:45 AM
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“may find themselves in a situation very soon where they're sitting on negative equity”.

Not the first time tnhat has happened…. Look back to the last time the socialist swill were the fede3ral government and you will see the early 1990s were when prices fell and negative equity happened.

The wage share of GDP – not much to comment on when the important figure is not the wage share of GDP but the discretionary component of that income value… left in peoples pockets and the Liberals were working to leave more there, the swill are hell bent on increasing taxation as they have done already (luxury car tax, alcohol mix drinks tax) and intend for the near future… carbon tax… despite the massive surpluses being generated following a decade of liberal fiscal responsibility (but for how much longer?).

“But tax and welfare reform, and reform of industrial relations - can spread the burden more fairly.”

No point in pretending the government taking a bigger share of the national economy, through taxation will increase the size of the economy. Aggressive taxation regardless for the noblest of aims or the most venal, like making sure no one can aspire to higher than that proclaimed by the socialist levelers, only stifles the spirit and reward of those with the ability to invent and create.

The very source of the innovation and new jobs which will employ people is murdered in the crib… but do not worry, we will all share, equally in the misery of socialist squalor.

Back to the drawing board Tristan, I know it is hard, using crayon, but do your best and present again... but if you offer more of the same we can respond with more of the same....
Posted by Col Rouge, Monday, 1 September 2008 1:44:43 PM
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Pericles, no reason why a system like the construction industry LSL system cant work. Pay into a central bank, then take-out as compensation while you take your leave. Problem would be entitlement increasing over the time period. But I agree with you - LSL was always a REWARD for long service. It cant be taken until 10 years, and is lost even at 9 years unless the employee is made redundant. Annual leave is designed to refresh workers, and smart employers encourage use of annual leave for this purpose (not to mention the increasing payout liability if leave is not taken regularly).

There is not a shortage of housing in Australia and there is not a price crisis either. Its a matter of perspective. Yes, Sydney prices are pure theft, but that's because all and sundry want to move/live there. Have a look at house prices at say Quandialla (central west NSW), or Barmedman just down the road. Prices range from $8,000 - $90,000 (yes the first one really is 4 figures, not a typo) for a family home. Of course there are few jobs, but there are also plenty of people who dont need a job. Larger centres are not far away, there are local supermarkets, pubs and sporting facilities (albeit country style), visiting doctors. And the cost of buying (see dont even have to rent) is more than affordable. There may not be a huge resale market if you want to move on, but at $8k for the whole price, just abandon it - who cares. What I am basically saying is that if we find incentive for people to repopulate areas that have been largely abandoned, then housing for all will become more affordable - and we will suffer less from the contraction in real means that is yet to come.
Posted by Country Gal, Monday, 1 September 2008 1:55:05 PM
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Pericles, I have another "bizarre" suggeston. Make public transport free.

And do that as apart of an integrated strategy that taxed the profit bludgers to pay for increased social spending on health, education, transport and housing.

Even more bizarrely, let's democratise society so that production decisions are determined by the majority.

And all this SME bleating about mandated and transportable LSL. Gee, the sky is going to fall in. "I will have to bear someone else's costs if the person I employ has almost ten years service." But swings and roundabouts - you'll also pass on those costs when workers leave your employ before ten years is up.

Pericles asks if I have ever run a business. No Pericles, I just ran the ATO's input into international tax reform very successfully for 4 years.My turn for a question. Have you ever worked in the community sector Pericles?
Posted by Passy, Monday, 1 September 2008 8:46:47 PM
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I certainly don't consider free public transport to be in any way a bizarre suggestion, Passy.

I'd back it.

I assume of course that the existence of free public transport would not preclude the existence of commercial services to supplement it? That's fine, then. And no-one will suddenly decide that those commercial services are barred from direct competition with the public routes? Good. After all, the fact that the public services are free should be disincentive enough to compete with, right?

So, how many routes would you run, Passy? And how much taxpayers' money would you invest in them? I don't mean the exact number, of course. But given that there is no practical upper limit to the volume of service you could provide if you wanted to, what measurement would you use to determine that point at which you say enough, no more?

Where would you draw the line on the lesser-frequented routes, that cost you ten times more per-passenger-mile than the popular ones, but are used by pensioners to get to bingo?

Saying "free public transport" is pretty simple. Providing it to a satisfactory level - given how many definitions of "satisfactory" there can be - is not.

But it's do-able, with sufficient political will, and intelligent planning.

Regrettably, the same does not apply to these other ideas of yours. At least, not in their present form

>>an integrated strategy that taxed the profit bludgers to pay for increased social spending on health, education, transport and housing<<

Define "profit bludger". Then tell us all - because we live in a democracy - what level of increase we are talking about. Then tell us where the money will be spent.

Voilà! You are now an aspiring politician.

I'll ignore the bit about centralizing the means of production, you were probably only teasing.

>>My turn for a question. Have you ever worked in the community sector Pericles?<<

No, only in the commercial world.

But in return, do tell - do you consider running "the ATO's input into international tax reform" to be "working in the community sector"?

Fascinating.
Posted by Pericles, Tuesday, 2 September 2008 3:03:06 PM
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Pericles

Thanks. You are deliberately misunderstanding me. My work in international tax was as an adjunct to big business.
My work in the community sector is separate. Tenancy advice is not international tax.

Some transport figures. Here in Canberra we subsidise the bus system to about $70m per year. Fares bring in $20m, so free bus routes as they currently exist would cost $20m. There would need to be planning for increased use (especially in peak hours), extra buses and drivers and non-hub to non-hub transport. Establish the principle and work from there. If needs be, increase rates on the richer suburbs (including mine) to help fund it.

Profit bludgers are those people who live off the labour of others (ie those who own the means of production, the factories, mines and offices and so on and make the decisions about what to do with the surplus (i.e. profit) workers create.)

I was serious about competition leading to monopoyy. It is the logic of the capitalist system
Posted by Passy, Tuesday, 2 September 2008 3:35:19 PM
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