The pay gap between the rich and poor has shrunk for the first time in 20 years, according to a new report on the nation's social wellbeing.But we are supposed to think this is good.
Mr Gray said over the long-term social outcomes were improving. Several indicators also pointing to a reducing gap between Maori and Pacific Islanders and other groups ...So, when the gap is negligible, ie we are all poor and need hand-outs from the Government, those percentages that the Ministry for Social Development work off will look just great.
The annual report, released today, shows that at the end of 2007 a household edging into the top 20 per cent of income earners is 2.6 times better off than one sitting at the top edge of the bottom 20 per cent.In case no one has understood me, if you define a low income as a percentage of all incomes (60% of the median income) then you can effectively hide how poor everyone in NZ is getting. It would be better to have some sort of absolute marker (such as cost of food, fuel, housing, etc) and compare everyone to that instead.
That is a fall from 2.7 per cent last year and the first fall since 1988, when the ratio sat at 2.2 per cent.
The report, which is compiled from a range of previously released statistics, also says there are fewer people living on lower incomes than 10 years ago.
In 2007, 13 per cent of people were deemed to living on low incomes compared with 22 per cent in 1997. Low incomes were defined as below 60 per cent of median income.
And stop calling welfare benefits income! They are not income. Separate out the welfare from the people actually earning money. Calling welfare benefits "income" is an example of political correctness, where the purpose is to confuse, hide and compare oranges and apples in order to socially engineer long-term change.
Related Link: Rich-poor pay gap shrinking - report ~ NZ Herald
it's mission accomplished Lucyna. The socialists promised equality, they never said anything about equality in wealth. Why should they, when equality in poverty is that much easier.
ReplyDeleteNo where in the article can I see proof of your contention, i just see the usual and typical journalistic lack of understanding of numbers.
ReplyDeleteHowever, IF NZérs are getting poorer, surely you should celebrate this as it means more of us get to go the heaven.
Fugley, it's not explicitly in the article. But, if you have a gap that is reducing, then the assumption has to be that poverty is on the increase. It would be clearer if the statistics could be separated out into income sources, ie those on welfare and those who work for their money, because then it would be plain to see that nett money gained through working is reducing and how everything is more expensive now. However, those on the bottom are being lifted up by redistribution, not an increase in wealth.
ReplyDeleteLucyna,
ReplyDeleteI'm afraid Fugley has a point here. Just because the gap between the top 20% and bottom 20% of income earners has marginally closed, does not mean we are all poorer (nor even that some cohort of Kiwis are poorer).
All that means is that incomes of the bottom 20% of income earners have risen, and incomes of the top 20% of income earners have risen by slightly less than the amount by which the incomes of the poor (the bottom 20% of income earners) have risen by.
And the more the gap closes, the closer the bottom 20% and the top 20% of incomes get to the median income. But that does not mean the median income goes down, necessarily. If job training and education levels rise, and this flows into high-skilled (and hopefuly high income) jobs, the whole wage sector can rise across the board. Sort of what happened to California when Silicon Valley took off.
Amd the fact that those in poverty (income below 60% of median income) has dropped from 22% to 13% tells us that people's incomes are rising, not dropping.
Meaning there is less poverty after 9 years of Labour/Greens/NZ First/United, especially after socially just moves like scrapping youth rates and raising the adult minimum wage to $12 an hour.
You are right about an absolute marker being useful, but these are notoriously hard to define, as they rely on defining what is a minimal basket of life-sustaining goods.
Relative markers like we in NZ use are also a good way of measuring social harmony, as extreme income gaps creates social tension every time (makes the relatively poor feel like they're being exploited y'know ;) ).
Oh, and 'income' is the correct term, as not all money comes as wages or salaries. Would you suggest someone who earns $100,000 from dividends alone has no money? And it gets messy trying to seperate the sources of money - most people get the bulk of their income from wages or salary, but also get some from interest, dividends, and possibly even - shock, horror - from benefits! Like seasonal workers - shearers and fruit pickers.
Let's not try to seperate people into the deserving and undeserving poor, shall we? It's so unChristian :)
Squaredrive, just one question before I go to bed. Are you a Christian yourself? Or are you one of those people that isn't a Christian, but, for some strange reason feel you have a good idea of what being Christian actually is? I really want to know.
ReplyDeleteOn second thoughts, ignore my comment. I'll read your comment again tomorrow morning.
ReplyDeleteHope you've had time to read my comment, Lucyna :)
ReplyDeleteAnd for the record, regarding my (un)deserving poor remark, I don't think it matters whether I am Christian or not , does it? The most cursory glance at Christian teachings reveals the principle of love overrides attempts to divide people by their past into deserving and undeserving groups.
After all, Jesus himself was dead keen on hanging with the 'undeserving', to show how 'deserving' they are of our and his love.
"I call sinners, not the righteous." [Lk 5:32]
Hi SquareDrive. I have read it and taken a number of notes on a much expanded explanation - however, during the week I tend not to have the time to do these sorts of posts.
ReplyDeleteAlso, the problem with non-Christians (and many Christians) is that they have a warped idea of what Christianity is. Christianity does not support slackers that rely on others to keep them in money and food - that is a common misconception. And the verse that you've pulled out does not support this view, either.
If you look at 2 Thessalonians 3:10, you will see this far more clearly:
6 And we charge you, brethren, in the name of our Lord Jesus Christ, that you withdraw yourselves from every brother walking disorderly and not according to the tradition which they have received of us. 7 For yourselves know how you ought to imitate us. For we were not disorderly among you. 8 Neither did we eat any man's bread for nothing: but in labour and in toil we worked night and day, lest we should be chargeable to any of you. 9 Not as if we had not power: but that we might give ourselves a pattern unto you, to imitate us. 10 For also, when we were with you, this we declared to you: that, if any man will not work, neither let him eat. 11 For we have heard there are some among you who walk disorderly: working not at all, but curiously meddling.
One more comment before I get on with my day - you say working out a living wage is too hard. I disagree - all that needs to be done is a standard set, for instance 1 person ought to be able to support a 5 person family on that wage. If it's "too hard", then you've fallen into the same trap as thinking teaching handwriting to children is too hard.
Hi Lucyna,
ReplyDeleteThanks for the informative comment - I had forgotten about 2 Thessalonians 3:10 - its as good as 2 Thessalonians 3:15!
And that is the nub I think - the unemployment benefit requires its recipients to be 'actively seeking work'; it is provision for those who want but cannot find adequate work to sustain themselves. In biblical times this would be done by family (though often they were no better off), but a more scattered demographic nowadays requires a social welfare system.
All other benefits are for incapacity (except the curious widows benefit, which seems to be some kind of 'reward' for loss of spouse?) - sickness, invalids, etc. DPB of course is not for personal incapacity from working, but because it is far harder for solo parents to raise children and work a full-time job. That some solo parents work full-time is admirable, but not always possible.
Of course, we all know a few slackers on benefits, but I don't think that ruins the overall system. And the level of 'slackers' is mostly determined by how effective WINZ is in following up on cases.
I know one long-term unemployed fellow who WINZ have been happy to leave on the dole, as he is low IQ (but not extremely so - he has had jobs before, but lost his last job due to a bad traffic accident). Not really a slacker, but would need active supervision for some time till he got back into work habits.
Anyhow, back to your other point: Yes, I was loose with my language. It is easy to *define* an absolute level of income as a poverty threshold - but you then have to get most people to agree to it ;)
This is mostly why it isn't done; people keep arguing over what is or is not necessary for a minimal level of sustenance. Some would include buying veges, others would insist beneficiaries grow their own. Some would include broadband so their kids can research school homework, other would say its a luxury. Aaargh!
Curiously, the current relative definition of poverty (60% of median income of c. $45,000pa) gives a full-time wage of just
$27,000pa. Only just above the minimum wage of $24,960pa. And that would be one heck of a mission to keep a family of 5 on $27,000 in Auckland. Rent would normally take $12-15,000 in cheap areas.
Which is why we need Christians lobbying for more effective welfare, that helps people survive with dignity while getting them into work :)