The Money Mustache Community
Learning, Sharing, and Teaching => Taxes => Topic started by: deborah on July 02, 2015, 04:39:25 AM
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Although I heard of this a while ago, I have only just sen it. The conversation reported it in December http://grattan.edu.au/news/young-australians-set-to-pay-for-government-policy-mistakes/, and included some interesting graphs that show that for the entire time the boomers, gen x's and millenials have been working, the workers have paid more than they have gained from the government, while the people over 65 (since the data ends in 2010 there is not a single boomer in this group) have always gained a disproportionate amount.
This has been sustainable because from the 1850's in Australia, each generation has had double the standard of living of the previous generation (the report (http://grattan.edu.au/report/the-wealth-of-generations/) says that for the last 70 years wages have increased, but in an MBA course we were told the 1850's information - and let's face it, in the 1850's my relatives were living in tents). However, this productivity increase is no longer happening according to the report. Also, it ceased in the USA and the UK some years ago (I guess the mining boom caused it to last longer here).
I guess that, in effect, we have all been part of a giant ponsi scheme paying for those over 65, and it is only now (now that all of us have actually paid - but I guess not quite enough) beginning to unravel.