Bill Mitchell — The rich are getting richer in Australia while the rest of us mark time

Only a short blog post today – in terms of actual researched content. Plenty of announcements and news though, a cartoon, and some great music. I have been meaning to write about the household income and wealth data that the ABS released in July, which showed that real income and wealth growth over a significant period for low income families has been close to zero, while the top 20 per cent have enjoyed rather massive gains. These trends are unsustainable. A nation cannot continually be distributing income to the top earners who spend less overall while starving the lower income cohorts of income growth. A nation cannot also continually create wealth accumulation opportunities for the richest while the rest go backwards. These trends generate spending crises, asset bubbles and social instability. That is what is emerging in Australia at present.

While Bill's analysis in this post is Aussie-centric, the rationale is applicable to the whole neoliberal world. It's basically what neoliberalism is about. The contemporary difference is that now the domestic populations of the neoliberal nations are being colonized as well. Even some of the top tier that are receiving most of the benefits are getting squeamish, realizing that an unsustainable process cannot go on forever and that eventually the bill will come due.

Bill Mitchell – billy blog
The rich are getting richer in Australia while the rest of us mark time
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Gennaro Zezza — Internal Devaluation in Greece

Summing up, internal devaluation has so far had negligible effects on Greek exports, while the fall in the purchasing power of wages has added to the fall in domestic demand generated by fiscal austerity, and thereby contributed to the unprecedented crisis in Greece.

Our July projections have so far been on track, and we predict that even if prices keep falling, as advocated by the troika plan, the response of the current account will be too slow to compensate for fiscal austerity. Strategies to increase employment and income are urgently needed.

Multiplier Effect
Internal Devaluation in Greece
Gennaro Zezza | Associate Professor in Economics at the Department of Economics of the University of Cassino, Italy, and a Research Scholar at the Levy Institute of Economics