It seems that everyone in Australia is talking about Duncan Storrar. A number of articles relating to him appear on my news feed. Without a doubt, his question has hit a sensitive national nerve.
Regardless of ones political or economic views, the fight that has erupted points out to me that we are universally unhappy with the current system.
I’m inclined to tip my hat to people, such as Wilkinson and Pickette, with their research behind the book ‘The Spirit Level’. In short, with moderate inequality, the nation’s economy flows more freely between all contributors than where we have super rich (who, by definition, remove significant amounts of the nation’s GDP into personal accounts) and entrenched poor.
I think of money like the blood of a nation. Clots are bad. Flow is good.
That said, one of the recommended articles in my new feed stood out;
OPINION: Is a family on $120,000 doing that much better than Duncan? Written by Johanna Morley
I had to read it. I can’t say that I was very moved.
Not only did the article rely on a range of fallacies and an inappropriate use of statistical data, but it also point out a lot of what is wrong with modern day Australia.
The sense of entitlement that various groups wax lyrically about is not restricted to a single cohort of the community. It’s wide spread.
To start with the simple errors – MS Morley’s article conflates rich with a household of two incomes of $60k. That’s by no means rich and not even part of the wage brackets likely to see much change in tax brakes.
To go further, while it sounds impressive to rely on ABS data, this data has limited use and is certainly erroneously applied to the article. For instance, two statistics used in one paragraph were the average grocery and transport costs for a couple with children. This is a blanket number for all couples with children (one has to assume because no link is given) regardless of household income. The greater the inequality within the sample, the less applicable this average would be to a single situation.
Ms Morley is likely to misapplied this data.
Certainly, Mr Storrar couldn’t spend the amounts provided in that article and so if these fictional families are, then yes, they are doing better than him.
But here’s my real grievance with the article; the phrase is ‘to live within ones means’ and not ‘to live to ones means’. Here’s my personal case study.
I definitely believe that I live a good life with my wife and two children.
My wife is a full time mother. With her background in early childhood development and our views on embedding our personal values on them prior to schooling age, it was a choice that we reached fairly early.
This of course means that I am the only earner.
She of course gets the FTB, but it amounts to pocket money because of my earnings. That said, our shared gross household income is significantly less than Ms Morley’s example families net income.
Moreover, I have a car loan and pay child support on my teenage son from a previous relationship. All of this is taken out of my payslip prior to addressing our own living expenses.
Even though I wouldn’t complain about my income, we probably have a little less than two thirds of one of her example families.
I would agree with Ms Morley’s example of Melbourne rent, but apart from that, my life is very different from her examples.
We have quality family holidays. We eat well. My children have everything they could ask for. Yet, we don’t live to our limits.
We budget hard and give ourselves a wide margin for the unexpected. We shop around and make the most of the variety of options out there.
We hunt op-shops. We budget annual memberships to places that our children love to visit often, meaning that weekend activities are exciting yet cheap.
And most importantly, we sacrifice what we don’t actually need (to be honest, it isn’t really a sacrifice).
To take mobile phones for example; you can buy a good phone for under $250 and pay for a sim only plan for $25-$30 per month, with unlimited calls and texts as well as sufficient data. This can amount to around half the cost of a phone-plan package that you buy from any retailer.
I also grow a wide range of fruit and vegetables to supplement our groceries (in a small space). We don’t watch (or pay for) TV and couldn’t care less about what is ‘the to-have item’ of the month.
Lastly, we aim to save at least 10% of our pay each week. This is the safety net that goes towards the unexpected and our holidays.
Through a careful eye on our income and critically evaluating our needs and wants, it’s possible to live well on a moderate income.
So to respond to Ms Morley’s question; is a family on $120,000 doing that much better than Duncan?
If they’re not, they’re doing it wrong.
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