Our concern should be about Australian families that can't afford the basics because they are paying all of their otherwise deposable income to financial institutions as interest. Our major concern ATM should be that debt bomb.
What I don't get is the infatuation some posters have for the micro detail of everything that happens in the US. I'm interested in the US economy and US politics for contextual reasons but I don't actually live there. The MSM are guilty of feeding us with US feeds to the extent that some punters may subconsciously believe we are a US province but …….. lets move on.
Context relevant to Australia High wealth economies like Australia risk following the US down the pathway to the haves and the have nots. Australia has had a more egalitarian culture than the US but the concept of equality and self sufficiency has drifted away in many corners.
Solutions? Australia is a small trading economy and we need to be competitive at what we do. Thus the price of what we produce can't vary too much from our competitors. We are what economists call a price taker and as a consequence our wages and other costs can only be charged at what global markets will afford.
The only policy solution I can think of is to structure our living costs to be less. Purchasing power parity (PPP) is far more relevant wealth indicator (in real terms) than whether someone earns $20 per hour or $120 per hour.
Other thoughts?
cheers
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