Thursday, November 3, 2011
Mike Butler: Rich pricks vs bludgers
Economist Gareth Morgan coined the term “nation of bludgers” in a 2005 commentary on the Working For Families policy. According to the Concise Oxford Dictionary, a “bludger” is a loafer who avoids work.
In New Zealand, a “rich prick” could be one of the 1 percent who are people with net assets of around $900,000. The top 1 percent own 16.4 percent of the nation’s wealth, according to a Statistics NZ report titled Wealth Disparities in New Zealand. (1)
In New Zealand, the so-called “rich pricks” pay most of the tax. Households with income of over $150,000, whether these include one person earning say $150,000 or two people earning $75,000 each, and comprise 10 percent of all households, fund 71 percent of net taxation.
A large chunk of everybody else receives more from the government than they pay in tax. Households with an income of $50,000 or below pay no net tax at all, and receive around $4.40 in benefits for every $1 of tax they pay. So they pay $1.7-billion in tax and receive $7.7-billion in welfare (excluding superannuation). Therefore, 44 percent of households are net tax recipients. (2)
The so-called “rich pricks” did not necessarily start out rich. They were the people who worked a second job on evenings and weekends, saved for a house, paid it off, invested, took a few risks, and continued to work long hours, while their idle friends would drink, eat well, and sleep.
The fortunes of the two groups diverge as time goes by so that after 20 years the drinking, eating idle would be coping with alcohol and obesity related health issues. They would be facing the rising cost of living with their static income either from a job or a benefit.
Wealth disparity is part of the human condition, and transcends ethnic, cultural, and religious divides.
The sheer quantity of bludgers in New Zealand means that most political parties, including the National Party, pander to the deeply ingrained “free money from the government” way of thinking.
Only the ACT and Conservative parties recognise that government generosity has to be paid for – largely by the 10 percent who pay most of the tax.
1.Wealth Disparities in NewZealand, http://www.stats.govt.nz/browse_for_stats/people_and_communities/Families/wealth-and-disparities-in-new-zealand.aspx
2. Net Taxpayers, http://www.kiwiblog.co.nz/2011/07/net_taxpayers.html
at 11:49 AM