Wednesday, May 21, 2008

Ross Gittins and the Age of Enlightenment

Ross Gittins is a man I like to read, quite a bit. He's very stable and forthright, which probably annoys the bleeding hearts and upper-crust toffs no end, especially when he bangs on about a subject like the incoming means-testing for the one-off baby bonus and on-going Family Tax Benefit (can I get any more "-" in that sentence - sure!).

Read here.

A sublime intellingence and an accurate interpretation of what it all means gives a strong article that tells it like it is. Personal opinion hasnt over-run the meaning, and I bet a few readers are sitting back thinking "he might be onto something, but that doesnt mean I have to like it". As it should make people think.

The key parts of this article I found are these:

"Figures updated from the official Household, Income and Labour Dynamics in Australia survey show that, for 2008-09, the median income of "households" will be about $80,000 a year before tax. And households earning $150,000 or more - starting at almost twice the median - are in the top 15 per cent of households."

OK, owning up time. Our household income will be less than the median this year, and probably for a few years to come. So means testing doesnt affect me. Thats not to say we need the bonus. We eat, we play, we live, we rent, we're not about to all die of starvation and poverty. So if our income was double, what is $5000 in the scheme of things? Answer: nothing. To jump up and down about unfairness if you're earning that much is plain greed and/or bollocks.

"Third, most people manage to keep themselves dissatisfied with their income by always comparing themselves with people who have more and never with people who have less (who, remember, they rarely see up close)."

"Fourth, a lot of people on high incomes keep themselves in a perpetual state of feeling they're having trouble making ends meet by increasing their spending commitments in line with every increase in their income."

I'm betting these are two things everyone does. Comparison to those better off is inevitable. Comparison to those who have less is rare, but more enlightening as to your current status I'd wager.

The fourth point is an excellent one. And in this time of interest free department store deals on everything under the sun, its only getting worse. So you stack up debt that you can "handle", then one bill increases (usually the most important one, the home loan), and suddenly its very sparse at the disposable income end. The non-essential bills get ignored, you sell the second or third car, you get a personal loan to cover store debts, and it all spirals.

The new residential morning mantra: "Grant me the willpower to resist interest free things I dont really need to survive..."

Insert tagline here...

No comments: