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Egalitarianism under threat

By Andrew Leigh - posted Thursday, 24 April 2014


The effect of this is that a high-wage family will get $75,000 when they have a child, while a low-wage family will get $16,000. As the Coalition's policy document last year stated, 'paid parental leave is an economic driver and should be a workforce entitlement'.

So to the most prosperous: welcome to your new age of entitlement.

Meanwhile, the Coalition's industrial focus is on making life hard for unions. Making collective bargaining tougher will likely widen the earnings gaps in Australia. One right-wing think-tank advocates abolishing the minimum wage altogether.

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A blind faith in trickle-down economics will make it harder for the Coalition to achieve other goals. While the Abbott Government may claim to have a Closing the Gap Indigenous policy, it'll be harder to achieve if they have a Widen the Gap economic policy.

But a deeper conversation about inequality is vital for my party too.

The gap between the powerful and the powerless has grown. So more than ever, Labor must be the voice of the vulnerable. If we do not speak out for those on the margins of our society, who will?

When Labor is given the chance to govern again, we should assess policy proposals based on how they will affect the gap. With Australian inequality higher than it has been for three-quarters of a century, we must not ignore the distributional consequences of policy.

The past generation has seen great success for the Australian economy. Our nation is more productive and entrepreneurial; more open to ideas, products and people from overseas. Yet at the same time, we have become more unequal.

Too much inequality strains the social fabric, threatening to cleave us one from another. Australia is a stronger nation when we act together than when we pull apart.

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This article was first published in The Australian on April 21, 2014.



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About the Author

Andrew Leigh is the member for Fraser (ACT). Prior to his election in 2010, he was a professor in the Research School of Economics at the Australian National University, and has previously worked as associate to Justice Michael Kirby of the High Court of Australia, a lawyer for Clifford Chance (London), and a researcher for the Progressive Policy Institute (Washington DC). He holds a PhD from Harvard University and has published three books and over 50 journal articles. His books include Disconnected (2010), Battlers and Billionaires (2013) and The Economics of Just About Everything (2014).

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