Inequality in Australia

Australia, it is said, is the land of the ‘fair go’, a place where ‘tall poppies’ are cut down, where nineteenth century visitors from England reported that they were made to feel that Jack was as good as his master and probably better. Australians, particularly Australian males, when travelling in taxis, sit in the front seat next to the driver.

Henry_Lawson,_1915_-_by_William_Johnson_(3369767790)Henry Lawson, Australian poet and prophet of egalitarianism, 1915 (Wikimedia Commons/State Library of NSW/William Johnson)

Yet, when our latest prime minister, Malcolm Turnbull, came under attack from the Labor Opposition for his private arrangements for managing his considerable personal wealth, there were media attacks on Labor for resorting to ‘the politics of envy’.

Turnbull’s predecessor but four, John Howard, had latched onto ‘aspirational politics’ as a vote-winner, the outer suburbs of Australia’s large cities had been sprouting ‘McMansions’ for decades, the membership of trade unions – traditional bastions of mateship and fraternity – had been declining for even longer.

Were these straws in the wind indications of a decline in egalitarianism in Australia? Of all modern day domestic issues, apart from those affecting Indigenous Australians, inequality is the one that is most susceptible to historical comparisons. Since August 2014, Honest History has been tracking and collating resources on the recent practical history of egalitarianism in Australia – the history of the rise of inequality. Many of these items are linked below, with the most recent ones first. Also try our Search engine using the search terms ‘inequality’, ‘egalitarianism’ and ‘equality’.

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CEO salaries and Australian inequality (10 February 2017)

Carl Rhodes of UTS on what the disclosed salary package of Australia Post CEO, Ahmed Fahour, says about attitudes to equality in Australia today. From The Conversation.

In the land of the ‘fair go’ not everyone gets equal slices of the pie (27 January 2017)

Nicholas Barry in one of The Conversation‘s Australian identity pieces marking Australia Day. (Another was by Frank Bongiorno, but they all link from here.) Looks at recent political rhetoric and at what might qualify as a ‘fair go’.

So although politicians claim to place a great deal of importance on the idea of the fair go, there are still significant ways in which Australian society seems to depart from this idea. Given the reforms the Coalition tried to get through (for the most part unsuccessfully) in the 2014 budget, and the recent scandal over Centrelink, it seems likely that the “fair go” will continue to be under political pressure in the years to come, whatever the rhetoric.

Attracted 309 comments.

Oxfam report reiterates earlier data about the extent of inequality (16 January 2017)

Guardian Australia report summarises latest data from Oxfam (with link to the full report):

Australia’s two richest people, Gina Rinehart and Harry Triguboff, own more than the poorest 20% of the country’s population, research has found.

Worth an estimated combined $21.5bn ($US16.1bn), the nation’s richest woman and the Meriton property boss are among the wealthiest 1% of Australians, who together own more than the bottom 70%, the report from Oxfam found …

Globally, the richest eight people – including the founder of Microsoft, Bill Gates, and Facebook’s Mark Zuckerberg – own as much as the poorest half of the world’s population, or about 3.6bn people.

“Collectively, the world’s richest eight men have a net wealth of $US426bn [$A568bn],” [Oxfam Australia chief executive, Helen] Szoke said. “Such an extreme divide between the rich and the rest risks plunging future generations into political instability, undermining our democratic institutions and creating economic upheaval.”

More from Helen Szoke. Nick Beams on the World Socialist Web Site. Factcheck from Peter Whiteford on The Conversation. David Ruccio on the Real World Economics Review blog.

Intergenerational inequality is not the whole picture (21 December 2016)

Steven Roberts and Alan France in The Conversation examine aspects of inequality between and within generations.

There’s no doubt there are differences between the experiences and opportunities of young people compared to their parents. But when you enter the smashed avocado debate of baby boomers versus millennials, you overlook the inequality between members of the same generation. This also misses other ways inequality is perpetuated, such as through the intergenerational transfer of wealth.

It’s uncomfortable for many to admit but Australia is a hugely unequal society, both in terms of incomes and wealth. Australian households in the top 20% account for half of the income stream, that’s about 12 times more than the bottom 20%. At the far ends of the distribution, the average weekly after tax income of the top 5% is 13 times that of the bottom 5%.

But this isn’t just an artefact of wealth in different generations. There are multiple ways we can glean this, most notably in relation to poverty.

Victoria releases gender equality strategy (9 December 2016)

The Victorian Government has released Safe and Strong: A Victorian Gender Equality Strategy, to

address inequality, sexism and violence against women in all its forms. The Royal Commission into Family Violence found that gender inequality is one of the key drivers behind family violence … The Victorian Government recognises that gender inequality is even more of a problem when it intersects with other forms of inequality and disadvantage, such as Aboriginality, disability, ethnicity, sexual orientation, gender identity, rurality and socio-economic status.

Journalist and gender equality pioneer, Anne Summers, commented on the Victorian report.

Young people’s search for skills; regional differentiation within Australia (24 November 2016 updated)

Norman Hermant on the ABC discusses a new report about the importance of young people picking up transferable skills rather than expecting jobs for life. Peter Martin in Fairfax on differential economic indicators across the country and George Megalogenis in The Monthly a couple of days later on the same subject.

Paying workers more is an obvious way to reduce income inequality (22 November 2016)

The Chifley Research Centre’s Michael Cooney points out in Guardian Australia that one of the global Sustainable Development Goals is as follows: ‘By 2030, progressively achieve and sustain income growth of the bottom 40% of the population at a rate higher than the national average’. We have noted the Centre’s work previously.

Trump lessons for inequality in Australia (11 November 2016)

One of many articles on the significance of the Trump win, this one by journalist Mike Steketee in Inside Story looks at the implications for how Australian governments deal with growing inequality here. Also this by Lenore Taylor in Guardian Australia.

Public opinion on widening inequality in Australia (2 November 2016)

Katharine Murphy in Guardian Australia analyses and pollster Peter Lewis comments on a recent poll about Australian public attitudes to inequality. While 65 per cent of those polled agree ‘Australian society has become more unequal over the last few years’ there is resistance to radical counter-measures like an inheritance tax or taxing assets just like income. On the other hand, 63 per cent believe the minimum wage should be increased significantly.

Yet another report on poverty in Australia; gender equality and female leaders (30 October 2016)

The ABC reports that a new study from the Social Policy Research Centre claims that the proportion of Australians living in poverty has hardly changed since the turn of the 21st century, despite many years of economic growth. Melissa Wheeler and Victor Sojo (in The Conversation) argue there is a connection between gender inequality and the low number of women in leadership roles.

Fair go no longer in Australia; Thomas Piketty visit; global perspective on inequality (28 October 2016)

Yet another report on inequality in the land of the fair go (to go with the many others listed under this thumbnail). This one is from the Community Council for Australia and it describes Australia as less fair, less safe and more inclined to gaol people than is the case in comparable countries. The report is here and a mordant comment on it from First Dog on the Moon is here. The Honest History book, to be published in April 2o17 by NewSouth, includes a chapter by Carmen Lawrence entitled ‘”Fair go” nation? Egalitarian myth and reality in Australia’.

This week also, the eminent French economist, Thomas Piketty, visited Australia to give lectures and make media appearances. In The Conversation, political economist, Frank Stilwell, comments on Piketty’s work, particularly on the need to focus on wealth inequality. Stilwell refers to his own recent report for the Evatt Foundation on wealth inequality in Australia. (See also below 9 August.) Jane Goodall in Inside Story reviews a Piketty lecture.

Finally, Honest History distinguished supporter and former senior public servant, John Menadue, makes some points in Pearls and Irritations about the connections between globalisation, market fundamentalism and the fall of communism. ‘The fall of communism’, Menadue says, ‘has emboldened the exponents of capitalism. There is a continual assertion of the importance of business over and against society and the community. Attacks on trade unions as we see in Australia are part of the increasing insolence of the powerful.’

How ethnicity and inequality reinforce each other: Chinese-Australian women in our history; Indigenous Australians in the Soviet Bloc during the Cold War (13 October 2016)

Dallas Rogers talks to Alanna Kamp (15 minutes) on The Conversation about Kemp’s research on how Chinese-Australian women have tended to be written out of our history. Jon Piccini writes in the latest Labour History about how Indigenous Australians were welcomed in the Soviet Bloc and how they were treated with equality. Both articles in their own way show the complexity of the influences on inequality in White settler-dominated Australia and how outcomes can change in a different environment.

Inequality, class and CEO salaries (28 September 2016)

Ben Eltham in Overland looks at how the political class is out of touch with the mass of people.

What can be done to restore some semblance of connection between rulers and the ruled? The laundry list of possible solutions is long, but not particularly promising. Some have suggested mandatory median wages for politicians, which in Australia would cap parliamentarians’ salaries at something like $55,000 annually. While this would certainly get the attention of backbenchers, it’s difficult to see how it would address the underlying causes of income inequality, or the yawning gap between the upper crust of the business class and nearly everyone else.

Lynsey Hanley in the UK edition of the Guardian explains why class won’t go away. How far does what she writes apply to Australia?

On the [Brexit vote] day, huge swaths of the country voted by class and geography. This was hardly surprising, considering how tensions between the classes have been exploited mercilessly by politicians. Social and economic inequalities, particularly between the south-east and the rest of the country, and between major cities and outlying towns, have grown, and that growth been tolerated, for decades – to a point where it now threatens social and political stability.

Julie Walker in The Conversation looks at the massive remuneration of some Australian CEOs and the difference between CEO remuneration and workers’ wages.

The Commonwealth Bank has the highest CEO pay ratio in our sample, with CEO Ian Narev earning more than 100 times the salary of an average worker. Even the lowest paid CEO in our sample earned 15 times the average Australian annual salary … The CEO pay ratio is an important measure of income inequality over time and Australian regulators should consider making this information mandatory … Historically, executive pay has not always been at the current controversial levels but has steadily increased since the mid-1970s, an increase which has continued after the global financial crisis.

Educational angle on inequality (22 September 2016)

As education ministers meet about Gonski, Chris Bonnor and Bernie Shepherd in Inside Story look at the inequality that exists in schooling.

There’s no shortage of commentary about how much funding is needed to lift student achievement – along with assertions that current levels aren’t doing it. Our expenditure on schools is substantial, but it is not effectively linked to goals and is poorly directed, with little coordination between levels of government.

Dependency problem or poverty problem? (21 September 2016)

John Falzon of St Vincent de Paul responds in Guardian Australia to proposals by Minister Christian Porter to tackle ‘welfare dependency’. ‘Australia does not have a welfare problem’, says Falzon. ‘We have a poverty problem and an inequality problem, but you know that these problems are going to be ignored when the dominant discourse focuses our attention on the “welfare problem.”’ Greg Jericho comments. Peter Whiteford comments.

The federal Budget 2016 and inequality (10 September 2016)

Peter Whiteford and Daniel Nethery write in The Conversation about the Budget’s impact.

There are always alternative ways of reining in the deficit, of course. Assuming that this is the right time for tackling the budget problem, there is no reason why an alternative package, broadly distributionally neutral in its impact, couldn’t be designed … [to] identify how to balance competing concerns for fairness with measures to reduce the budget deficit.

The article includes a comparison of OECD countries’ expenditure on social benefits for low income households. It shows that ‘the Australian social security system is more targeted towards the poor than any other rich country’. This presumably goes some way to balancing other influences leading towards inequality in modern Australia.

Health and inequality: Boyer Lectures and articles on The Conversation (2 September 2016)

To mark the Boyer Lectures by visiting expert, Sir Michael Marmot, (president of the World Medical Association) on ‘Fair Australia: Social Justice and the Health Gap’, The Conversation has a couple of articles, from Sharon Friel from ANU on how class and wealth affect our health and Fran Baum from Flinders on policy responses, with links to related earlier material.

Many facets of inequality: Honest History miscellany (26 August 2016)

A collection from recent online sources citing various studies of inequality in Australia and overseas. They look at globalisation, the impact of inequality on the economy, and health, housing and digital access aspects of inequality.

Wages growth in Australia is at record lows; the wisdom of targeting inflation (18 August 2016 updated)

Greg Jericho (see below 4 August) follows up in Guardian Australia with historical data (mostly since 1998) on sluggish wage growth. He notes that the Commonwealth Bank CEO, on $12.3 million annually, is an exception. Jericho broadens the focus to why we need to shake up economic policy. Lots of history on inflation and GDP growth. More from Jericho on 6 September on disconnect between GDP growth and how ordinary people are doing.

Sheil and Stilwell on yet another study of wealth inequality (9 August 2016)

Distinguished authors in The Conversation on work from the Evatt Foundation on growing wealth inequality in Australia since the 1970s, on the policy implications, and on what this says about our egalitarian myths.

Strangely, low wage growth is accompanied by historically low cost of living (4 August 2016 updated)

Greg Jericho in Guardian Australia crunches numbers for recent years on cost of living, mortgage interest, and real wages and concludes that, ‘despite wages growing at record lows, for those households who have benefited from lower mortgage payments, cost of living pressures are now as low as they have ever been’. Jericho follows up on issues raised by and comments on his original piece. Jericho takes a historical look at unemployment. Christian Marx in Australian Independent Media Network in October on unemployment.

Yet another survey on wealth and income, this time from HILDA (22 July 2016 updated)

The Melbourne Institute survey on Housing, Income and Labour Dynamics in Australia (HILDA) has been going for 15 years and here is its latest report. Plus a bundle of articles riffing off it.

Inequality as an issue in the election campaign (11 July 2016)

Victoria Fielding in New Matilda about how the election campaign failed to grasp the importance the community attaches to growing inequality (11 July 2016). Related from Anne Coombs on the role of governments.

Sins of the parents and a chat on Late Night Live (18 June 2016)

Jessica Irvine in Fairfax continues with a series of articles (search on Google) on inequality – this time on ‘intergenerational earnings elasticity’ – and Philip Adams talks to Elizabeth Farrelly and Christos Tsiolkas on whether we are creating an unequal Australia.

Inequality and causes of death (6 June 2016)

People in lower socio-economic brackets much more likely to die of heart disease.

Andrew Leigh MP on how lack of competition contributes to inequality and what might be done about this (1 June 2016)

Leigh’s John Freebairn lecture, ‘Markets, monopolies and moguls’, delivered in Melbourne on 19 May.

Connections between neoliberal economics and inequality and the implications of this (30 May 2016)

Greg Jericho in Guardian Australia takes a historical view and makes some suggestions about likely futures.

Salvation Army survey covers family violence, homelessness and other drivers of inequality (25 May 2016)

This detailed report was based on a survey of 1600 Salvation Army clients.

The income divide in Australia: the return of class-based politics? (20 May 2016)

Denis Bright in the Australian Independent Media Network looks at some ‘no-go areas’ in Australian politics to do with inequality and the reliance on ‘trickle down economics’.

Boomers and millenials: not intergenerational but class warfare (6 April 2016)

Bridie Jabour in Guardian Australia looks at difficulties faced by Generation Y in getting access to housing and what this says about deeper issues of inequality.

Generation Y here and there and now and then compared; gender pay gap getting back to historic levels (10 March 2016)

Returning to the fray well into the first quarter, we link to a Guardian interactive that compares Generation Y now to the same cohort up to 30 years ago, to other cohorts, and to other countries plus a short piece from Max Chalmers in New Matilda which includes a fascinating graph, reproduced below, showing the gender pay gap returning to the high levels of the 1980s. There are links to an ACTU report for International Womens’ Day.

But why did a bloke write the story? Perhaps implies that male attitudes are part of the problem. Certainly shows that gender is and has always been a key driver of inequality.

Screen-Shot-2016-03-08-at-10.56.10(New Matilda/ACTU)

Elsewhere, Eva Cox reckons the feminist project needs a reboot. The article drew 177 comments.

Is welfare sustainable? (6 December 2015)

In Inside Story, Peter Whiteford of ANU takes a historical look at trends in welfare spending. Among his conclusions:

  • ‘[O]ur main concern should be to avoid any significant blow-out in unemployment’ and we should look closely at the problems some people face in moving from welfare to work.
  • ‘[T]he growth in the size of the population aged sixty-five and over will put upward pressure on spending over coming decades. Preparing for the continued ageing of the population, however, does not necessarily imply that the solution is to seek to further cut spending on working-age payments.’

Educational opportunity in Australia 2015 (23 November 2015)

A report from October (updated in November) by researchers at Mitchell Institute (at Victoria University).

An enduring view of Australia is of a fair and egalitarian place in which opportunities exist for all to get ahead and succeed in building secure futures. Education is viewed as one of the main vehicles through which this happens. But to what extent is this true of modern Australia? To what extent are the benefits of success available to all?

Some make it, some miss out but can be helped.

Inequality is becoming a bigger issue for Australians (4 November 2015)

Notes interesting response from latest Scanlon Foundation Social Cohesion Survey: those surveyed increasingly believe that income gaps are too large.

Who are the beneficiaries from our tax system? (21 October 2015)

Peter Whiteford asks the question, taking account of a new study by the Productivity Commission. ‘Overall, these estimates support previous findings that the Australian social security system remains well targeted by income. This is less true in relation to wealth …’. On the other hand, ‘a much wider range of people benefit from the welfare state and pay taxes to support it than is often acknowledged’.

Which states are more unequal and which facts stack up? (28 September 2015)

Articles in The Conversation look at which state is most unequal (if you’re in New South Wales, you’re standing in it) and check the inequality facts quoted by Opposition Leader Shorten (they were mostly spot on).

Yet another report, this time on the growing gap in living standards (17 September 2015)

Ben Phillips of NATSEM reports for Anglicare. Analysed by Greg Jericho in Guardian Australia. More.

More on the problem and at least something on the solutions (5 September 2017)

Thom Mitchell looks at the recent Foundation for Youth report on inequality as it affects Australian youth (see also 1 September update below). The Real World Economics Review Blog (recommended) flags an article which links the policy preferences of the wealthy with the health of democracy internationally. In general, the article suggests that the very wealthy have more conservative views on economic policy and that these flow disproportionately into influence on public policy. Then, Genevieve Knight reviews AB Atkinson’s recent book, Inequality: What Can be Done? Atkinson is also a collaborator of Leigh (below).

Andrew Leigh MP on inequality: highlights reel (1 September 2015)

Looks at six items from this author, examining Australian progress towards greater inequality along with some policy options to address it. The items highlighted (from 2007 to 2015) cover the distribution of top incomes in Australia, comparable countries, Leigh’s 2013 book Battlers and Billionaires, a review of Thomas Piketty’s book Capital in the Twenty-first Century, a 2015 update on both the book and the review (with policy options stressed) and another lecture from May 2015 with additional policy options.

The War Census of 1915 had some insights into inequality at that time (7 July, 4 August 2015)

The government’s initiative to get a handle on available manpower – an initiative that led ultimately to the conscription referenda – also threw up some interesting information about wealth and income, even though there were methodological flaws.

A roundup of reports, some analysis and a review of Piketty (24 June 2015)

World Socialist Web Site looks at reports by Boston Consulting Group, Russell Sage Foundation and Oxfam on global inequality and by Knight Frank on the United States. Ian McAuley on why inequality matters. Geoffrey Harcourt reviews Piketty. Australia’s ACOSS releases yet another report on inequality (both wealth and income) in Australia. Mardi Dungey on the implications for inequality of the arrival of the new economy.

Material from June 2015 and earlier (most recent first)

Cheryl McDermid on the World Socialist Web Site on recent Australian evidence, June 2015.

Joseph Stiglitz in 2014 wrote a book about which he talked in Australia on the ABC, at ANU and at the Sydney Town Hall. Most recently (May 2015), there has been a report from the OECD and an edited extract from the book Governomics by Lyons and McAuley.

A CEDA report on entrenched economic advantage, April 2015.

A Fairfax Media article on tax foregone by large companies (with material sourced from Tax Justice Network Australia)

A piece from the World Socialist Web Site on global inequality (showing that one percent of the world’s population now controls 48.2 percent of its wealth, up from 46 per cent in 2013).

An article from Alan Austin in the Australian Independent Media Network drawing upon a wide range of statistics to show that Australia was in 2014 the richest nation in the world, though there were some caveats.

Our highlights reel on the ACOSS Poverty Report for 2014 plus the report of a Senate inquiry, released late in 2014.

A policy brief from the Australia Institute, July 2014.

An article in The Conversation, March 2014, by Professor Peter Whiteford with some links to other articles of his.

The report of a roundtable, Parliament House, January 2014.

A link to an abstract of a 2012 article by Murray and Chesters which covers 122 years of history (you’ll have to track down the full text).

Some information about Stilwell and Nolan‘s 2007 book Who Gets What? which marked something of a revival in inequality research in Australia.

An article from Richard Denniss on the costs of ageing in Australia (Journal of Australian Political Economy, 59, June 2007).

Some pictures from the resources of Melbourne’s Herald-Sun, depicting inequality and poverty in that city in the 1960s and earlier.

 

 

 

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