The Gregory Thesis

One more pair of 100-word blurbs, these from Bob Gregory.

Big idea:

Should the Lowest Income Groups pay the Highest Marginal Employment Taxes?
Low income groups pay the highest effective marginal income tax rates – 50-70 per cent – upon accepting employment. For those with children, high marginal effective tax rates can extend to incomes of $60,000. Policy issues are complex. Need major tax inquiry into whether this is the best marginal effective income tax system. The best data for policy development and analysis in health, education, welfare and work are collected administratively and kept within government departments where they are not adequately analysed. Major inquiry needed to develop ways to link these unit record data and make them available for policy analysis (with privacy protection).

Mind Change:

Social problems – lack of employment growth among the unskilled, the increase in disability pensioners, lack of economic opportunities for children from poor families, long term receipt of unemployment benefits for the disadvantaged and growing indigenous disadvantage – have become much larger post 1975. I had believed and hoped that economic growth would considerably alleviate these problems. After ten years of strong growth it is clear that economic growth is not enough because it has been biased towards skilled labour and away from the unskilled. The need to more vigorously explore micro policies directed towards the unskilled and disadvantaged is much greater than I had thought.  

Also, ANU is hosting a pre-summit panel discussion next week, featuring a few of the invitees. Details below – all welcome.

THE 2020 SUMMIT: Panel Discussion
Professor Hilary Charlesworth
Dr Jane Golley
Professor Bob Gregory
Professor Ann McGrath
Professor Warwick McKibbin
Wednesday 16 April, 3:30pm
Seminar Room A, Coombs Building, Bldg 9, Fellows Road

Apologies for the excess of summitry-related postings lately, but it seems in the spirit of the event to open up the debates as much as possible.

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5 Responses to The Gregory Thesis

  1. derrida derider says:

    I’ve always thought Bob is too pessimistic about the problems for the unskilled. Unskilled people have always been screwed by the system but less so now than in 1975. It temporarily got a bit worse in the 80s and 90s with a cohort of older men affected by industry restructuring, but most of them are on the age pension now. And the feminists are right – he too lightly dismisses the gains for women.

    Of course if the economy is growing the jobs it creates will tend to be the higher productivity (ie skilled) ones. If the jobs had all been unskilled ones we’d be whingeing about stagnant or declining real wages. As it is, neither the earnings nor income distribution have widened perceptibly in the last 15 years or so.

    On the data issue, I say more power to his arm. But what researchers miss (including you, Andrew) is that they need to convince the public first. The history of abuse of these things by the powers-that-be in the name of “fighting crime”, “cracking down on dole cheats”, “anti-terrorism”, etc means that people are rightly very chary about giving anyone open slather on collating databases.

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  3. Andrew Leigh says:

    DD, I find it difficult to imagine what a public campaign for better access to microdata would look like (TV ads bemoaning the ABS’s tendency to collapse hours worked into 2-hour bands? Street marches chanting “whaddaya we want? linked admin records? whendaywewannit? now.”). I expect that the Scandinavian attitude to data supports your theory, but surely elite attitudes rather than public support account for the fact that the US has a more open attitude to data than Australia?

  4. Thinking in old ways says:

    When Bob Gregory is forced to spend some of his precious word limit inserting the words “(with privacy protection)” I think the extent to which ‘privacy’ is just one more form of political correctness with which we must comply becomes obvious.

    What is strange is that it is a problem of an unholy alliance of the privacy lobby and the tendency of governments to conceal rather than reveal – and the absence of other voices.

    It is an issue of both the elites and the public and needs to be tackled at both ends.

    Universities can play a big role – after all they are one of the hot beds of the privacy lobby (just look at how many academics are key players in groups such as the Australian Privacy Foundation) – so start convincing your colleagues. Similarly just how much noise do we hear from academics about issues such as freedom of information, did we hear the cries of the academics when the (not very good) ABS proposals for linked census data were jumped on by the privacy lobby. Just how many academics are actively pushing to get the data out of the bureaucracy – and complaining to Ministers when they cannot.

    Put it another way – until the politicians and bureaucrats are as scared of you and others accusing them of censorship and restricting public understanding of policies and programs as they are of the privacy lobby then the public opinion war is not won.

  5. derrida derider says:

    Look, you don’t need to convince me that the attitude of Australian governments and their servants to this absolutely sucks – I’ve got into a lot of trouble over a long career by loudly saying so. But their instincts are always going to be towards secrecy. They seem to think that if you haven’t got the data to analyse a program you can’t criticise it, which is of course not true. It just makes the criticism less informed, and hence much more random, because the total quantum of criticism is set by the vagaries of politics, not social science.

    This instinct towards secrecy, though, is only made effective by ridiculous “privacy” laws which in turn arise from understandable public fears. And it’s those fears that need to be addressed.

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