Jun 11, 2015

Belt-tightening 101

I guess it's not news that Joe Hockey is out of touch. 

The man who insisted that "poor people don't drive" is now coaching first home buyers through the property bubble with the advice to get a well-paying job. Good idea Joe! I mean, why do so many people stick with their low or average wage jobs when they should just get a well-paid one? It just shows, people are not rational.

But more to the point.

As fascinating, in a train-wreck way, as these gaffes are, Joe Hockey's are usually explicable by remembering that instead of talking like a savvy politician, he usually talks like an economist, which can seem insensitive to a regular person. ("If housing were unaffordable in Sydney, no-one would be buying it," he said.)

What I find more interesting is how governments never - inexplicably in my view - offer to tighten their own belts while they claim the need to cut back on public spending.

It's quite amazing how many of our parliamentary leaders - one is tempted to say "all of them" - claim every monetary allowance their jobs entitle them to, even while: 
(a) they are rich 
(b) their claims are not really in the spirit in which the allowances were intended, and 
(c) the same politicians are operating a nation-wide belt-tightening manifesto and do not hesitate to chastise less well-off people for claiming less ambiguous entitlements.

Let's let point (a) slide, as I know, everything's relative. The richer you are, the more expenses you have, so sure, none of these guys feels rich I am sure.  And they work hard for us, right?

On to point (b). Sorry to harp on Joe Hockey, but I will anyway. Thanks to Nick Xenophon, we learn that Joe Hockey, like many other MPs, claims a $270 per day travel allowance while he's staying in Canberra, and uses that money (as he is allowed to), to pay off the mortgage on his Canberra home. 

Obviously, travel allowances for MPs to go to Canberra make sense. And maybe even this usage of them does too - when you get into the detail, it's hard to draw a line in the sand on these things.

But - point (c) - politicians don't find it hard to draw a line in the sand when it comes to entitlements paid to other people. Things like maternity payments, single-parent allowances, Newstart allowances, pensions, schoolkid bonuses, and all the rest that are paid to the leaners and double-dippers and bludgers of this nation, who neglected to secure themselves a well-paid job and a chauffeur and travel allowance.

In a liberal democracy where votes are bought with tax cuts and spending programs, the tax system and the government transfer system always get messy. Periodically a review is done over the whole system and changes are proposed, and by and large they never happen.  That's one of the drawbacks of the system and it will probably never be fixed.  Likewise, whether a particular payment is "middle class welfare" or "tax justice" for bracket creep, to what degree payments are undermined by rorting and to what level benefits should be paid, are all never-ending debates. 

But people are fairly reasonable. They won't buy a "budget emergency", but they will agree on the general necessity to limit spending and maintain a working budget. Disregarding the diehard left and right, most people agree that governments should not tax unreasonably, should support the needy and provide basic services, and should maintain a strong economy. 

So here is what I don't understand. If governments want to get people to accept spending cuts and a "belt-tightening" regime, why don't they ever reduce their own entitlements?  I mean just a little??  In my living memory, only Mark Latham ever did anything along these lines, when he cut MP super entitlements to match the public rate. (Maybe only the more... ah... out-there politicians attempt this stuff).

I would think that if Joe Hockey and Tony Abbott got up and said, "Look, we're cutting all these things, but also, we're cutting these travel allowances / placing a moratorium on any MP study tour that can't be managed with a couple of Skype calls / freezing MP salaries for three years", that they would win a lot more hearts and minds.

So why don't they do it? Just a little? Cutting just a few things would at least show MPs are tightening their belts too. They wouldn't even need need to cut that much - just offering SOMETHING would arguably only reduce their total compensation by a little, and yet would pay off hugely in the form of much-needed public support.

Seriously, I don't understand why this is never done. Can anyone enlighten me?

"Politics" according to a 9gag user


  1. I wish I could enlighten you. The age of entitlement is dead - unless you are at the upper end of the scale, in which case your silver spoon is safe.
    I am reeling tonight at the idea that we should have less wind turbines because they are (arguably) unattractive and noisy. If I was offered the choice of a wind farm or a coal mine in the street I wouldnt have to think for very long...

    1. It's weird, their antipathy to the wind farms.

  2. I have been meaning to post about something Alpha ZXT like this on one of my blogs and this has given me an idea Thanks. Nobody in life gets exactly what they thought they were going to get. http://www.strongmenmuscle.com/alpha-zxt/

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  4. Human nature? Yes, human nature, especially for people that just think they are better than everyone else which is many politicians.

    And Holy Cow, Melissa joy is really getting around today!

    1. Good point. It certainly takes a healthy ego to be a politician.

  5. I don't consider politicians are particularly well paid but I very much dislike these 'expense' rorts, which is what they are. This especially refers to the travel allowance and overseas study tours, with most of the information easily found on the net. I do recognise though that face to face meetings are beneficial but some of the 'studies' are just an absurd waste of money.

  6. Belt tightening:
    step one: buy a belt....

    Have you seen the cost of belts lately?

    1. Yes - it helps to start off with money if you want to save money... :)



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