Thursday, February 01, 2018

Some positive poverty news

There is NZ research from the SOFIE (now discontinued) data that mirrors the findings below recently published by the University of Queensland. It's out of step with the leftist discourse so little is heard about it:

Poverty is not a life sentence in Australia
January 24, 2018, University of Queensland

"Researchers say almost half of Australian families tracked in a 30-year study have experienced poverty at least once.

University of Queensland researcher Emeritus Professor Jake Najman said the study found little evidence of a persistent 'underclass,' suggesting that for many families poverty was a transient stage in life.

"It was common for families to move in and out of hardship, due to a change of circumstances such as loss of employment or marital breakdown."

"However, there was evidence of substantial economic mobility – the ability of a family or individual to improve (or experience a decline) in their economic status – both within a single generation and across generations."

Emeritus Professor Najman said it was not surprising those most likely to suffer poverty were single mothers, the unemployed and aged pensioners.

"The study suggested that poverty in Australia could be split into two groups – a relatively small group who experience chronic, long-term poverty and a much larger group who experience shorter periods of hardship."

"Interestingly, adversity experienced early in the child's life course does not independently predict poverty when the child reaches adulthood. "

He said that meant those who experienced high levels of poverty and/or adversity in early childhood rarely went on to experience persistent poverty and adversity such as unemployment as adults, and other factors were more likely to lead to adult poverty.

The study of more than 2000 Brisbane families measured family income when the child was born, and at five, 14, 21 and 30 years.

Emeritus Professor Najman said future research would investigate the health and behavioural consequences of the different forms of poverty."

Wednesday, January 31, 2018

First child poverty reduction target

"Reduce the proportion of children in low income households (before housing costs) from roughly 15 per cent of all children to 5 percent. This reduces the number by more than half from 160,000 to 60,000."

The threshold used to measure the proportion below is the median (the middle whereupon half fall below and half fall above).

The next  measure, which establishes "low income",  is arbitrary. It might be 50% of the median or - most commonly used internationally -  60% of the median.

The easiest way to reduce the proportion of children from "15 to 5 percent" is to lower the median.

With Labour's new workplace policies, that's not an unrealistic prospect.

This might also be naturally achieved with an ageing population who have increasingly not owned their own homes and will rely solely on Super.

If more childless families  are poorer then the child poverty problem will reduce.

This target is bunkum.

Having children makes you poor

Clearly children are a cost on a household economy but my statement goes beyond that.

What most people don't appreciate is how the government measures household income and the effect  the presence of children has on the result.

It's called equivalisation.

It's the application of a formula to adjust income for the number of household members.

Here is the relevant table from last year's report:

"The first row of figures identifies the family or household type: (1,2) is a one adult, two child household, and so on. The second row gives the values of the equivalence ratios used. The body of the table indicates, for example, that a (2,2) household needs around $28,000 to have the same purchasing power as a (1,1) household with an income of around $18,000. Each has an equivalised income of $13,000 (or, to put it another way, each household has an income of $13,000 per equivalent adult). "

The way child poverty is measured is derived from the median equivalised household income.

So from the example a 2 adult, 2 children household has their income more than halved before it is entered into the calculation.

So we have this crazy conundrum.

The mere fact of having children drives households into 'poverty'. Or the way poverty is measured creates a greater problem than might otherwise present.

Monday, January 29, 2018

Heather Du Plessis - oxygen for the suffocating

Heather du Plessis-Allan is now the morning talk host at Wellington NewstalkZB.

I've never understood why the station doesn't just can the Wellington programme and let Leighton Smith blast us. But demand for localism  prevailed. This combined with a moderate host stopped me listening.

Now Heather, I am going to disagree with plenty of times but at least she takes a position with conviction. After years of not participating I was compelled to ring and express a view this week.

At only 33 she has clearly avoided the offence and victimhood virus most prevalent and contagious  in young adulthood.

If you are in Wellington - or the NewstalkZB listening area -  I can commend her to you.

Sunday, January 28, 2018

Winston picking winners

Readers know I love my horse racing. The industry has been screaming for more government support because that's why it's so much healthier in Australia (and hurting our industry in the process).

Today Racing Minister Winston Peters apparently promised an all weather track at the cost of $10 million (double it for starters) and either promised or called for tax breaks because the industry (breeding in particular) brings in so much money.

If tax breaks can make one industry stronger, then they can make any industry stronger.

Government picking winners is a recipe for corruption and injustice. We cannot expect New Zealanders who have not a skerrick of interest in the racing industry to disproportionately pay taxes to advance it.

Tax breaks are not subsidies if they are applied universally. Reduce tax period.

You are a guardian of public money Winston. Not a private investor.

On the upside, I am looking forward to our Prime anti-poverty crusader getting it in the neck today over her government's support for "rich pricks".