By Joe Montero

A report from the Productivity Commission just out, has revealed that the number of Australians living below the Henderson poverty line has not gone down over the past 27 years

The report also suggests that there has been constant economic growth through this time. That the number in poverty has not gone down is not Earth breaking news. Anyone bothering to look about them can see it.

But the assertion of continuous economic growth is a different matter. A fiction has been created and propagated by politicians and officials, anxious to talk up the situation.  The economy has not grown. Manufacturing has been devastated and Australia turned into a service economy, with a bit of mining.

Economic growth should be defined by the goods we produce, and the services associated with this. Grow these and the accumulated wealth in the country increases. The trouble is that much of what is counted as growth is the movement of money. This has certainly accelerated. It is not real growth though. Especially so, when it is moving upward into the fewer hands of the richest, and over the longer-term, it is depreciating in value. Even if taken at face value, the claim of economic growth is exaggerated by the high level of immigration into Australia, where the new arrivals bring their wealth into the country and become participants in the economy.

To top it off, a large proportion of this money in circulation is credit. This means the now is being covered at the cost of the future.

So, let us begin by admitting that the Australian economy is not really growing. Then we can draw the connection between the upward flow of money and wealth and the problem of poverty.

The biggest causes of poverty are the lack of jobs for those who want them and the casualisation of work. This is the increased exploitation of the workforce to pay for the growing wealth at the top, at a time when the real total stock of what the country produces is not growing, or barely moving. Profit is generated by paying less for wages. This is backed by raiding the public purse. Cuts to government services have been another means to help the money flow upwards.

Those at the top of the pile who are gaining, are doing so at the expense of others.

Under these circumstances, poverty is not going to lessen. It is going to increase At least the Productivity Commission report admits that is has not declined.  The Commission’s chairman Peter Harris says this finding is serious and should demand the attention of political leaders. Right on both counts.

But there is a failure to admit that the upward redistribution of income upward is the reason, and unless this is taken on board and there is action to turn the flow in the other direction, all the talk in the world is meaningless.

To do this, deeply embedded assumptions must be cast aside. A corporate investor led model is not the answer. Experience has shown that a free hand to the corporations creates parasitic capitalism and this is a big part of the problem. Action to counter this and putting people first, is the way to make a difference.