I enjoy reading Ross Gittins' articles on economics. He is doing a great job of highlighting the many failures of the neoliberal dogma in Australia.
ROSS GITTINS: What's kept us from full employment is a bad idea that won't die:
Wages have risen in response to the higher cost of living, but have failed to rise by anything like the rise in prices. Why? Because, seemingly unnoticed by the econocrats, workers’ bargaining power against employers has declined hugely since the 1970s.
This is so key. When I was in university, the Phillips Curve was being boosted as the saviour solution. I’ve changed, and economic thinking needs to change as well.
Unions have been neutered. Individualised long-term contracts have nobbled any opportunity for people to achieve meaningful wage growth; unless you’re a CEO in which case your performance bonuses alone will see your income skyrocket year-on-year.
Our major economic problems are that trickle-down economics didn’t trickle—rather it locked in wage growth benefits to the elite—and that the value of capital has been overvalued at the expense of labour. Which benefits the elite, who are the continued proponents of neoliberalism. Wow, who would have thought?