Quote of the Week

“The simple truth is that, when you go for years abusing your market power, the electorate eventually wakes up and hits back, threatening to toss out any government that isn’t prepared to set things to rights.” [Economics Editor Ross Gittens writing in The Sydney Morning Herald, 25 February 2019]

Tweet of the Week

In #SenateEstimates right now they're discussing Robodebt & a spate of suicides, this public servant is saying that because suicide victims are no longer here, by definition, then any causality cannot be proven between the Robodebt and the suicide.

I shit you not.#auspol pic.twitter.com/M2Fqb9JS55

— Bee (@BelindaJones68) February 21, 2019

What will it take to shame religious institutions into joining the national redress scheme for people who suffered institutional child sexual abuse?

Readers living in the Clarence Valley will notice that the Anglican Diocese of Grafton named as perpetrating abuse* by the Royal Commission into Institutional Responses to Child Sexual Abuse has not yet joined the national compensation scheme which would allow victims who suffered at the hands of the diocese to seek full redress.

Readers further afield will notice that a large number of Protestant and Catholic institutions are dragging their feet with regard to this redress scheme.

Institutions That Are Not Yet Participating in the Redress Scheme For People Who Have Experienced Instituti... by clarencegirl on Scribd

https://www.scribd.com/document/400681740/Institutions-That-Are-Not-Yet-Participating-in-the-Redress-Scheme-For-People-Who-Have-Experienced-Institutional-Child-Sexual-Abuse

* This is the same Anglican Diocese of Grafton which Clarence Valley Council openly supports by inviting it to offer up a prayer of its choice at the beginning of council monthly meetings.

A reminder of just how far the mining industry will go to deny the lack of a social licence and undermine community opposition

ABC News, 19 February 2019:

Lawyers for mining firm Adani proposed waging "war" on opponents of its controversial Queensland mine by using the legal system to pressure government, silence critics and financially cripple activists, according to documents obtained by the ABC.

The draft copy of Adani's new law firm's aggressive strategy to bring the Carmichael mine to life is labelled "Taking the Gloves Off" and outlines a commercial proposal by AJ & Co to win a multi-million-dollar legal contract with the Indian mining giant.

In the document, the Brisbane firm promised to be Adani's "trained attack dog".

The strategy recommended bankrupting individuals who unsuccessfully challenge Adani in court, using lawsuits to pressure the Queensland Government and social media "bias" as a tool to discredit decisionmakers.

In a section called "Play the Man", it recommended "where activists and commentators spread untruths, use the legal system to silence them".

It also urged Adani to hire private investigators to target activists and work "with police and a criminal lawyer to ensure appropriate police action is taken against protesters".

"Like a well-trained police dog, our litigations know when to sit and shake, and when it is time to bite," the law firm promised.

"To achieve its commercial goal, Adani needs to accept it is involved in a war."

While Scott Morrison is trying to convince the electorate he now believes in climate change one of the denialists in his government is trying to erase it from school textbooks

There is Australian Prime Minister and Liberal MP for Cook since 2007 Scott Morrison fronting the media trying to convince sceptical voters that he and his government are now fully behind the need to tackle climate change.

However also talking to media is Liberal MP for Hughes since 2010 Craig Kelly doing his level best to undermine the current round political propaganda by calling for a rewrite of both climate science and history.

His climate change denying argument is far from unique.

Sometime around 1904 in far-off England a probably homesick second-generation Australian called Isobel Marion Dorothea Mackellar penned a six stanza poem called The Core Of My Heart aka My Country. This poem has been subverted by climate change deniers into a ‘proof’ that climate change is not real and is not happening right now.

Here Mr. Kelly citing all he can remember from the second stanza………

The Guardian, 26 February 2019:

The publisher of a NSW year-10 history book has rejected complaints from the federal Liberal backbencher Craig Kelly that it misrepresents facts about climate change.

Kelly took issue with the characterisation of climate change in the textbook Pearson History New South Wales.

Kelly has written to the NSW education minister, Rob Stokes, saying the book’s description of Tony Abbott as a climate change denier was “an offensive slur equating it with Holocaust deniers”, the Daily Telegraph reported.

The book says: “Climate change is noticeable in Australia, with more extreme frequent weather events such as the 2002-06 drought or the 2010-11 Queensland floods.”

“That is simply an inaccurate statement that is in a school history book,” Kelly told parliament’s federation chamber last week.

“What chance do we have of forming the best policies in this nation to deal with fire, floods and drought if we have children being misled by incorrect information in our history books?”

He quoted Dorothea Mackellar’s poem My Country to argue contemporary natural disasters are nothing out of the ordinary: “I love a sunburnt country, a land of sweeping plains, of ragged mountain ranges, of droughts and flooding rains,” the poem says.

“We need to understand that we live in that same country that Dorothea Mackellar wrote about over a hundred years ago,” Kelly said.

“That is why we need to prepare and help people recover from their resources instead of wasting money pretending that we can change the weather.”

The Australian Bureau of Meterology says “one of the greatest impacts of climate variability and climate change occurs through changes in the frequency and severity of extreme events.”

It describes the 2011 Brisbane floods as the second-highest flood level of the last 100 years, after January 1974.

The bureau and CSIRO’s latest State of the Climate report said Australia was experiencing more extreme heat, longer fire seasons, rising oceans and more marine heatwaves, consistent with a changing climate.......

Future of the Murray-Darling Basin: “It’s not a political football, it’s life we’re talking about!”

https://youtu.be/R9_H9JbbIjY

On the subject of income, welfare support and spending

Will negative wage growth, the acute poverty of jobless people combined with the avarice of employers and punitive federal government policy intesect to create a perect storm which will see household spending fall this year?   

Current state of play......

ABC News, 23 February 2019:

Rather, Dr Lowe saw stagnant household incomes is a much bigger threat to consumer spending, and thus to the 60 per cent of the economy based on it.

"Aggregate household income used to grow at 6 per cent, it's growing sub-3," he told the MPs on the committee.

"That's a big difference, and you accumulate that over three or four years and income is 8, 10 or 12 per cent lower than it otherwise would have been.

"Many people borrowed assuming their incomes would grow at the old rate and they haven't.

"They're having more difficulty, they've got less free cash and so they can't spend, so this is why I've put so much emphasis on the need for a pick-up in wage growth."

Dr Lowe told the committee he has been using speeches to try and lift wage expectations, while the RBA has been keeping interest rates low and stable for an extended period of time to relieve the pressure on households.

The RBA governor said, while the strategy seems to be working — with unemployment down at 5 per cent and wage growth starting to pick up from recent lows — he could use a bit more help from the Fair Work Commission and employers.

Fair Work last year awarded a 3.5 per cent pay rise for those on the minimum wage and linked awards, and Dr Lowe said that was a "sensible and right policy" and a similar increase this year "makes a lot of sense".

"If workers get their normal long-run share of that [productivity increase] then their real wages should rise by 1 per cent a year," he said.

Financial Review,  7 February 2019:

Consumer anxiety has reached its highest level in three years, with households spending less on discretionary items as they worry about their finances and the future.

The National Australia Bank consumer anxiety index rose to 62 points in the December quarter, and close to 40 per cent of those surveyed said they had experienced financial hardship during the quarter – the highest level in two years.

Households said they had pulled back their spending on things like travel, eating out and entertainment due to heightened anxiety about their financial conditions.

The primary causes of anxiety through the December quarter were how to finance one's retirement and how to provide for one's family's future....

"What's happening here is you haven't got much wages growth, you're paying off utilities, you're paying off debt, and you're doing things that you have to do."

Mr Oster said after doing all those things, there wasn't much money left for households.

Anxiety about job security reached its highest level since 2016, and 50 per cent of homes in hardship found their financial position impacted by high utility bills.

The Guardian, 17 September 2018:

A proposal to increase Newstart allowance by $75 a week would lead to a boost in consumer spending, creating more than 10,000 jobs and lifting wages, a new report shows.

The report by Deloitte Access Economics, released on Monday morning, said the policy to increase the incomes of more than 700,000 people by $10.71 a day would cost the federal budget $3.3bn a year.

But a “prosperity dividend” would see the government collect an extra $1bn in taxes as a result of a stronger economy, and the proposal was also projected to create 12,000 extra jobs in 2020-21 and increase wages by 0.2%.

It comes amid debate about the rate of Newstart, which at $272.90 for a single person has not risen in real terms in more than two decades. It will increase by $2.20 this week as a result of indexation.

The Australian Council of Social Service (Acoss), business groups, unions and a former prime minister, John Howard, have all argued for an increase, but the government has so far dismissed those calls….

The bulk of the economic benefits from increasing the payment would go to the bottom 5% of Australian income earners, who would receive “six times the dollars going to the highest income quintile”. The “poorest of the poor” would receive 28 times the relative boost to their disposable incomes, than the top income quintile.

Regional areas “most in need of help” would be key winners from increased spending….

The current rate is the equivalent to living on $38.99 a day. The report said a single person who also receives the maximum rent assistance and the energy supplement would be living on about $49.24 a day.

Previous research has shown that those on Newstart live on as little as $17 a day after their housing expenses and bills.

ABC NEWS, 9 September 2018:

It may not have garnered the same attention as the surprisingly strong second-quarter GDP growth, but an equally striking fact in last week's national accounts was household savings had just hit a post-GFC low.

It is not a new phenomenon. The household saving ratio — or the ratio of households' net saving to disposable income — has been shrinking since 2014.

What makes the latest figure uncomfortable is that there is now little fat left to trim, and on current trends households will be spending more they earn.

The ability of the Australian economy to keep growing in the face of a number of challenges in recent years owes a fair bit to the savings so prudently built up after the sobering experience of the GFC.

As JP Morgan's Tom Kennedy points out, the persistent decline in savings since 2014 has been an important part of Australia's real GDP growth performance, helping offset some of the spending drag associated with record low wages growth and an unemployment rate that has yet to fire up wages.

While the correlation between savings and spending is far from perfect, Mr Kennedy has drilled down into the figures, and is worried.