My question was more along the lines of whether welfare can continue the way it is or will the cookie jar simply run dry.

I have no problem with having welfare as a safety net, it's just that it has expanded in such a way that one can now do the sums whereby they can choose to either 'work', or 'not work', this is provided they have enough children that they can't possibly afford.

What most people don't realise, or choose to overlook, is that the high income earner also has children of their own that they provide for and, in many cases, my own included, carry large sums of debt and put thier but on the line every day, esspecially if one is self employed.

I fear the system just can't continue this way. Then what?

rehctub:"Then what?"

The second phase of this economic disaster - the middle-class collapse when the Govt can no longer provide the subsidy that has enabled such conspicuous consumption and such conspicuous failure to repay mortgages on the part of the consumers. If the relatively small number who will lose their jobs in the first phase is added to by an enormous number who can no longer support their mortgages because they no longer receive the handouts they have relied on then the housing market will be in genuinely serious trouble, not just a downswing. The financial institutions that hold the mortgages will also suffer and so it goes on.

Every day I'm happier not to have a mortgage or to be relying on someone else's business to support me. It'd be nice to have a bit more capital, but you can't have it all.

"I can't help but wonder how the welfare bill compares to the cost of retired politicians, that's running into billions now, but the facts are a state secret, FOI can't touch it,"

not quite true, remember Capt Smirk and "his" Future Fund

The problem was that the Politically Correct "Wright Family" stuff from both sides of govt [getting a re-run again here] WAS allowed to stop people QUESTIONING the ethics of FF.

But take my ex wife as an example, put in $500 to ComSuper back in 1968 to 1975 or so, retired in 1976 [bad back you know] and got a million, just up to her "retirement age" [60 for wimmen]

and if she pegs it, 5/8 goes to her new hubby, who is a billionaire but no means test here as this is UNFUNDED SUPER

at same time Howard tried to starve male pensioners out to 67, but we zapped him

It's interesting how often ideology can trump reality when government handouts are under discussion.

>>Without welfare we could all join our comrades in china and india working for 50 cents an hour.<<

mikk, if you simply change that "without", to "with", the sentence would be far more accurate.

"Our comrades" overseas arrive at 50 cents an hour from the opposite direction, i.e. from a starting point closer to zero. To them, it is a living, a first step out of abject poverty.

If we continue to imagine that welfare is some form of protection from economic realities, then we will rapidly put ourselves out of business.

The underlying problem is that a government does not actually have any money of its own. We provide it, in various different ways. Through our paypacket, which is derived from the business that employs us. Directly from those companies in the form of a tax on the profits they earn after paying wages. And from our consumption (GST), which we pay for from what's left of our paypacket, that we earn from our employment.

If our businesses cannot compete because others are able to pay lower wages, then either i) revenue dries up and there are no taxes to collect, or ii) we have to lower those wages. And if the taxes dry up, and we continue to pay welfare, there will be nothing left to pay those fat cats who are employed by the government, and have those infinite pension rights that real businesses cannot afford.

Maximillion plays from the same songbook.

>>Welfare is there to provide a minimum standard of living for all. It was introduced because Governments realised that the capitalist system is intrinsically unfair...<<

The "capitalist system", Maximillion, has been the engine from which governments acquired the money that they were then - subsequently, after the event, post facto, later on down the track - able to redistribute to the needy in our society.

Without capitalism, welfare at the levels we have become accustomed to, would simply not be possible.

Those "minimum standards" would head south in a heartbeat.

Pericles, you are demonstrating the "Government as a business" model, and within those terms I suppose you're more or less right.
I, however, reject that whole view, it flies in the face of the very reason why our ancestors fought and died to create and protect "Democracy". Under that model, we are rapidly re-establishing the Feudal System, complete with "right to rule", inherited power, money as the determinant of social worth, all the things that democracy was supposed to eliminate. Do you consider it "democratic" that a Packer or a Murdoch can "earn" millions, and pay less than 5cents on the dollar taxation, while we mere serfs must pay 20-30%? Many of the legal profession pay NOTHING! Doctors can get away paying on average 7cents per, and so on and so on, and don't even think about business, transfer pricing alone rips billions away annually, let alone foreign ownership or tax-havens.
Can you explain or justify that?

It says it all when Pericles says

"If our businesses cannot compete because others are able to pay lower wages, then either i) revenue dries up and there are no taxes to collect, or ii) we have to lower those wages."

It would never even cross the capitalists greedy little minds to reduce profits now would it? Its always wages that have to go down.