A world apart

Welcome to our new two tier world, where the rich and princely salaried classes stand to gain even more while the small business operators are getting hit with higher costs.

The next few months will see a boom that will keep consumer confidence at record highs for the first half of the financial year, and produce small business cashflow projections for the full year that do not take into account the impact of a potential series of interest rate rises designed to curb their enthusiasm for expansion in the domestic market.

The rich and princely salaried class are still trying to find new tax dodges based on their record high levels of business and consumer optimism, while the vast mass of the population believes that the boom will come to an abrupt end as soon as we run out of marginal seats to have a dose of aspirational nationalism.

As SmartCompany’s Mike Preston pointed out yesterday, there are stark differences in the spending powers and prospects of the well-healed and educated cohorts and slow growth in the number of new vacancies for those who have never made it into the over-optimistic world of the VCs.

The reality is that we are moving to a Disraeli-style economy with the sponsors of the workplace reform ads wanting to keep downward pressure on median wages and upwards pressure on executive and stockjockey take-home pay.

The Federal Government continues to show that AWAs for the million or so who have them are lucrative and appreciated by those on above-average incomes – used to inflate the supposed gains yet to be seen by unskilled workers who have been forced to sign up along the lines of that chocolate retailer.

It is reluctant to release any information on the realities of AWAs for small business and household sector firms that do not share the cream from the mining and property booms.

Our Treasury and RBA officials have a “see-backroscope” approach that looks at the results of the last few months to impose penalties on small business in the next few months. Interest rates are used to curb the aspirations of small investors while the Federal Government squirrels billions of dollars of company tax into yet another series of recycling bins.

The federal Opposition me-tooism leads it to make concessions to the highest income sectors and neglect the impact of the highest levels of Government withdrawal of funds from the economy for the self-employed and smaller enterprises that are not seen as its core constituency, let alone on the long-term unemployed and those being forced into the casual workforce by welfare-to-work coercion.

Collective punishiment of those who are struggling to take on more staff, look for innovative and entrepreneural solutions and reach out for culturally aligned export markets should be seen as an unacceptable broad-brush approach that destroys long-term viability and sustainable prosperity. It is time the Federal Government followed the lead of other countries and took a more active approach to assisting small business operators.

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