All posts by Editor

Frydenberg signals intention to rely on old fallacies instead of a proper plan for the economy

By Ugly and Joe Montero

Yesterday, Treasurer Josh Frydenberg set the scene for a massive cut in government spending. The cornerstone of his presentation was the deficit blowout of $184 billion. The essence is that the money must come from somewhere. Continue reading Frydenberg signals intention to rely on old fallacies instead of a proper plan for the economy

The government’s new generosity toward those out of work is a hoax

By Joe Montero

Praise over the Morrison government’s generosity with JobSeeker and JobKeeker is misplaced and premature.

Enough has been said to reveal the pattern of what can be expected. Here are some quick observations spelling out the barely hidden truth. A more detailed response will come in due course.

This is what we were told onthe eve of the 21 July economic statement, when more is to be revealed.

Although both payment are to continue as they are, at least till September, the hurt is in the detail.

The current JobSeeker payments of $1,100 per fortnight will only continue for some. Those on unemployment before the lockdown, will go back to trying to live on $40 a day. This has been politely called ‘tailoring’. In reality, it’s a cut in JobSeeker through the backdoor.

Same story for JobKeeper. This is to be targeted more carefully. Read: Fewer businesses will be covered. Although the prime minister has said those that don’t really need it won’t get it, and those struggling to cope will, what this means hasn’t been defined.

We have seen that some of the biggest businesses have the resources and incentive to manipulate the system. They can reduce the size of operations and profit from the subsidy. It’s all about the ratio between the loss of revenue from the scaling down and the saving in labour costs, within the context of a sluggish market.

Small players don’t operate on a scale large enough to benefit from this advantage. This is a big reason why the biggest companies have been taking the lion’s share of JobKeeper. The scam has not been ruled out and is likely to continue unchecked.

The bottom line, is that fewer of the workers missing out on wages are going to get the JobKeeper payment.

Small and medium sized businesses will continue to be given access to cheap loans, through the arrangement already made with the banks. The maximum has been raised from $250,000 to $1 Million. The biggest change, however, is that instead of being provided to keep current operations going, they loans will be tailored towards new investments.

How this is going to help small and medium businesses to keep on going in the difficult situation they find themselves, hasn’t been explained. Those struggling day to day to survive are not going to undertake new ventures. It doesn’t add up, unless the money is really going somewhere else.

The most likely purpose, is to encourage greater automation and provide fewer jobs. This is called increasing the capital intensity of operations. and it is taking place at a time when there is already not enough work for all.

Genuinely struggling business is going to saddle up with new debt. If they don’t have the revenue coming for when payments on the loan are due, the prospect is closing their doors for good.

The idea that business will suddenly spring back to where it was before and expand is wrong. In the best of conditions, recovery will take time.

The assistance promised to small and medium businesses is largely a mirage. And the generosity towards recipients of Jobseeker and JobKeeper is the phasing out of payments, made to look like a gift.

New economic modelling by the Australia Institute shows that a return to $40 a day will put at least 4.5 million Australians into serious poverty.

The direction being taken by the government only makes sense, when the real underlying policy is to deliberately create a bigger pool of unemployed, as a source of cheap labour forced to work for less, to be used to pull down wage rates of those who do have work.

This is not what Australia needs.

Ben Oquist, executive director of the Australia Institute said: ‘

“This will not only have serious negative social effects for decades to come but makes terrible economic policy by effectively withdrawing much-needed stimulus.”

This is why there are calls to at the minimum keep the JobSeeker and JobKeeper at the present level permanently.

It is an indispensable part of coping with the pandemic, as well as rejigging and rebuilding an economy that puts people first, after it is over.

Morrison government refuses to promise not to keep on pressuring robodebt victims and stop chasing those targeted

By Ugly

Scott Morrison’s government can no longer hide behind the Robodebt system. It blew up in its face. Now there is no choice but to scrap it under its current form. It is technically illegal and cannot continue.

A weak apology to those who were hurt is far from good enough. It’s even worse, when there is a refusal to rule out that such thing ever happening again. There even a refusal to guarantee that money wrongfully extracted will be paid back, or to stop hounding those the system has targeted.

Such meanness says a lot about how Scott and his mates see those who are not in their special club.

A leaked document obtain by The Guardian reveals that the illegal ‘income averaging’ method has been used widely. Staff at Centrelink were instructed to use the method in 2015,when the Robodebt system was put into operation. Although this was before Scott Morrison became the Prime Minister, he has continued it.

Since 2015, the number of claimed debts exploded, from around 20,000 a year to 20,000 a month.

Those without work and those without a decently paying job are seen as a resource to create an army of cheap labour, to pull down the wages of those who do have a proper job.

To do this effectively, a section of the population must be marginalised, have hope stripped away from them, and be made desperate enough to work for crumbs. Businesses can then demand more of their workers, with the promise that there are plenty of others prepared to do your job for less.

Rising unemployment and insecure work serve this purpose.

It’s a method that has been used through history and becomes more pronounced during times of economic difficulty. But this does not fit a society and economy that claims to be fair.

While some employers might benefit in the short-run, history has shown that when this persists and becomes the norm, the economy is undermined.

By aiding this Scott Morrison and those around him are betraying those they claim to serve and don’t really give a hoot about the future of Australia. They are there to serve the big end of town and line their own pockets.

The sooner everyone decides to consign this lot to history the better. Imagine if they were similarly chased to recover ill gotten gains.

Big movement for economic and social justice is taking off

By Joe Montero

The new fast-growing national movement to hit Australia, Living Incomes For Everyone, was launched on Tuesday 21 July.Thousands watch online during the event or after. It is on Facebook and has been included below.

Thousands join Living Incomes For Everyone online launch
Video from Living Incomes for Everyone

Continue reading Big movement for economic and social justice is taking off

Live Rebel Diaz concert on Saturday 11 July

Video by Rebel Diaz

 

New York based hispanic hip hop Rebel Diaz are about people organising and fighting injustice, working together and creating a new world. Their lyrics are moving draw the audience into what they are saying.

The event has been organised by the Latin American solidarity Campaign (LASNET) to raise funds to support indigenous political prisoners in Chile now on a hunger strike, political prisoners from the national uprising agianst the government, and to support community kitchens providing food for the poor and hungry.

The charge is $12.

Register on this Facebook link Continue reading Live Rebel Diaz concert on Saturday 11 July

The high rise lockdown in Victoria and the lesson this provides

By Jim Hayes

No doubt about it. Victoria’s state government has done more to combat Covid-19 than any other around Australia. This is not to say that it has all been perfect. Nevertheless, what it has done has not been able to prevent Melbourne being the epicentre of what could be the start of a second wave outbreak. Continue reading The high rise lockdown in Victoria and the lesson this provides

We need to consign the term ‘dole’ and its nasty derivatives to pre-Covid history

Cassandra Goldie, the Chief Executive Officer of the Australian Council of Social Service (ACOSS) wrote the following opinion piece (The Guardian 2 July 2020), about the need to champion a new way of looking at unemployment and the way in which those out of work are regarded. In the post Covid-19 reality, the past must be left behind to deal appropriately with the economic reality the nation faces.

Continue reading We need to consign the term ‘dole’ and its nasty derivatives to pre-Covid history