Australian voters – caught between the Devil and the Deep Blue Sea

The Wednesday news and music blog post. The Prime Minister has now announced the federal election will be held on May 21, 2022. I think I will concentrate on the football that Saturday rather than the election given how depressing the political situation is. They should allow only a week for campaigning because 3 days in to the current 6-week campaign it is already deeply depressing and reinforces that Australian voters, particularly those of the progressive variety are caught – Between the Devil and the Deep Blue Sea – when it comes to federal elections. Both major parties are happy to over 550,000 Australians (and their dependants) deliberately forced by government policy to live in abject poverty. Many thought that the Australian Labor Party (the leader of which couldn’t even tell the media this week what the unemployment rate actually is) would probably honour their previous promises to review the unemployment benefit system and increase the payment as a result. Given that voices from the welfare lobby, the OECD, the business lobby (and yours truly) have consistently been calling on the federal government to end the enforced poverty. Overnight, the Labor Party demonstrated their credentials for re-election. No matter what else they say in the next several weeks, the fact that they have abandoned any intent to raise the unemployment benefit nor engage in any job creation disqualifies them from office. I hope they lose. But then I hope the other rotten conservative lot lose to. An impossible set of hopes. The Devil and the Deep Blue Sea. Speaking of the devil we can then listen to ‘Old Devil Moon’ after all of that and calm down.

Perhaps, as this ad from the Australien government tells us, the choice is really between:

But then if you vote otherwise, you risk rewarding the – Neo-liberals on bikes … (July 11, 2012).

Devil and the Deep Blue Sea! I told you.

Anyway, yesterday (April 12, 2022), the Shadow Assistant Treasurer, the Harvard-educated or should I say mis-educated Andrew Leigh who thinks Modern Monetary Theory (MMT) is a joke, told an election forum sponsored by the Australian Council of Social Services, that the Labor Party would not seek to raise the unemployment benefit if it won office on May 21 nor would it honour its prior commitment to have an enquiry into the benefit system.

More Labor MPs have come out today confirming this view and citing ‘budget’ pressures to reduce debt.

The actual Shadow Treasurer has been raving on about ‘budget repair’ and the excessive federal debt for ages.

Such is the leadership of the so-called party of workers.

Their previous pledge at the last federal election to hold an enquiry if they won (they lost – again!) was just a gutless move to avoid having to commit to an increase in the benefit levels.

Now, they have even withdrawn that level of commitment.

Meanwhile, they continue to support the current conservative government’s policies to pass on tax cuts which will overwhelmingly benefit the high income earners.

Why does this matter?

Well, one would think that any prospective government would not support a deliberate policy that ensures a large group of citizens in the nation are forced to live in abject poverty.

That is adults and their children.

But how can a political group that aspires to represent the working class yet will not commit to eliminating mass unemployment nor will commit to ensuring those that are unemployed as a result of poorly designed fiscal policy can live above the poverty line?

Unelectable is the word.

Remember when the Labor Party was last in government and the then Families Minister defended the Government’s refusal to increase the unemployment benefit by claiming that she could live on the then $A35 per day unemployment payment.

And when that outrageous comment brought public censure, her office edited out that part of the interview from the official transcript (Source).

You can find rather detailed analysis of the Australian poverty line from the Melbourne Institute.

Their work on this issue dates back to the early 1970s when the Institute was known as the Institute of Applied Economic and Social Research (University of Melbourne) under the direction of the great economist Ronald Henderson who pioneered the development of poverty line estimate and conducted the famous Poverty Inquiry which released the first estimate for the December quarter 1973.

The following graph shows the evolution of the Single Unemployment Benefit and the Single Unemployed Poverty Line since 1973 until March-quarter 2022.

The facts are:

1. The single unemployment benefit stands at $45.91 per day which is well below any reasonable estimate of the poverty line in Australia (for singles at $A79.29 per day).

2. The single unemployment benefit is now $A233.69 per week below the poverty line.

3. For married couples, the unemployment benefit is currently at $83.61 per day, while the corresponding poverty line is set at $112.32 day.

4. Whether one is single or in a couple, once accommodation is paid for, there is not very much left of the unemployment benefit income. There is a massive shortage of social housing (greater than 450,000) because of the refusal of governments to invest as they chased fiscal surpluses.

Note the divergence between the unemployment benefit and the poverty line began in the early 1980s, when the neoliberal mantra about fiscal surpluses really took hold in Australia.

The deviation started around 1981-82 when the Australian economy experienced a major recession (at that time, the worst since the Great Depression).

The then conservative government was under massive political pressure as the fiscal deficit rose via the automatic stabilisers and instead of meeting the challenge of recession by actively attempting to stimulate aggregate demand, they tried to claim that fiscal austerity was the way forward.

Undermining the generosity of the unemployment benefits was one manifestation of this mania. They lost office in 1983 and the newly installed Labor government set about providing some relief for unemployment benefit recipients. It still remained a fact that the single unemployment benefit was close to (just below) the poverty line.

The next major recession, worse than the 1982 downturn, occurred in 1991-92 under that same Labor government and their response to the cyclical downturn was poor. By then they were completely obsessed with achieving fiscal surpluses and failed to stimulate the economy quickly and sufficiently enough to prevent a major deterioration in the labour market.

But their response to the recession from the perspective of the unemployment benefit recipient was appalling. You can see from the graph and a major divergence between the single adult unemployment benefit and the estimated poverty line began during this recession and there’s been no resolution to that since.

Both sides of politics share the narrative that increasing the benefit payment would ‘cost billions’ and jeopardise fiscal surplus targets.

So if you are a voter in Australia, think about this on May 21, 2022.

Whatever else the Labor Party should promise – they should have prioritised lifting this group of citizens out of poverty.

According to the Global Wealth Report, Australia consistently is at or near the top of the global wealth rankings.

Yet at least 550,000 individuals and their dependants are forced by government policy to live in abject poverty.

There is something amiss.

Previous relevant blog posts

I have consistently written out the state of poverty that the government deliberately forces onto the unemployed – see these blog posts among others:

1. Why are we so mean to the unemployed? (September 23, 2009).

2. The plight of the unemployed – under growth and decay (November 16, 2010).

3. Our pathological meanness to the unemployed is just bad economics (February 15, 2012).

4. Fat cat bankster wants to make the unemployed even more desperate (August 23, 2012).

5. The indecent inconsistency of the neo-liberals (April 30, 2013).

6. Framing matters – the unemployed and the farmers (August 7, 2018).

7. ‘Progressive’ groups in Australia captured by neoliberal ideology (September 18, 2018).

8. The Australian Labor Party is still stuck in its neoliberal denial stage (December 18, 2018).

9. The adult unemployment benefit in Australia should be immediately increased by $A200 per week (August 1, 2019).

Music – Barney Kessel

This is what I have been listening to while working this morning.

Here is the classic Burton Lane song – Old Devil Moon – which was composed for a 1947 musical – Finian’s Rainbow.

Many people have covered this song both with lyrics and instrumentally.

In general, I am not attracted to movie songs (with major exceptions) but this treatment by the ace American guitar player – Barney Kessel

It was on his 1973 album – Just Friends – which is a live recording from a concert in Sweden on September 27, 1973.

Barney Kessel is accompanied by two premier Swedish jazz players on this album:

1. Pelle Hultén – drums.

2. Sture Nordin – double bass (died October 11, 2000).

There is some great chord playing, particularly his use of inversions and triads that make this album worth listening to.

That is enough for today!

(c) Copyright 2022 William Mitchell. All Rights Reserved.