• "I am no economist. I am, however, a low-middle-income earner wondering where in heck I will live when I am older and unable to work." (Photodisc/Getty)Source: Photodisc/Getty
Who would have thought that the economic issue of housing affordability would be turned into a blame game, fueling hatred between generations and races?
By
Helen Razer

30 Nov 2016 - 2:35 PM  UPDATED 30 Nov 2016 - 4:50 PM

Unless you are able to excrete dollars from your eyes, those tears of yours are probably induced by the state of the local housing market.

That stuff is sufficient to make you cry. Of course, there are several economists who tell us there is nothing to worry about, and that if we yell at young people, Baby Boomer people, lazy people, greedy people and/or Asian people, we should have it all sorted. Meantime, if really we want to buy a home, we should just be agile enough to sell a body part.

I have considered this—perhaps I could get a deposit from the sale of my tear ducts? But, my underworld inquiries found that the organ-to-house price ratio in Australia was one of the worst in the world.

So, too, is that more conventional index, the income-to-house-price ration. There can be no meaningful comparison made between housing affordability in the seventies, or even the nineties, and today. Back in the Whitlam era, houses cost roughly four times average annual individual income. Today, estimates have the rate at more than 20 times.

There can be no meaningful comparison made between housing affordability in the seventies, or even the nineties, and today. 

I am no economist. I am, however, a low-middle-income earner wondering where in heck I will live when I am older and unable to work. Even so, it seems to me that the reasons that I cannot afford a home are pretty big. Like, way bigger than, “Chinese people are buying all the good places” and “You eat too many expensive sandwiches and you left your wallet in an Uber”.

Economics, economists often tell us, is a complex business. But, this doesn’t stop some then from offering simplicity to the pages of the national press. Stephen Koukalas, an actual economist, wrote earlier this year that the Millennial taste for “soy lattes” was the problem. So was easily debunked demographer Bernard Salt who made the case against smashed avocado. How do we know these guys, who continue to double down on their absurd claims, are wronger than an avocado latte? They don’t consider either the cost of the typical wage or the cost of the typical house.

Again. I ain’t no Helen Maynard Keynes. But I’m going to go out on a rental limb here and say that there is a relation between the cost of things that people buy and the amount of money people have.

Using morality to explain economics is a horrible habit. This is the kind of logic that can lead very directly to racism and its good pals, sexism and homophobia. It has also played a pretty key role in religious hatred, too. “The Jews control all the money” is an untrue thing to say, but it becomes crushing fact if you say it enough. “Aboriginal people have no interest in money, they’re above it” might sound nice, but it is a ridiculous thing to say when many Indigenous Australians obviously know the value of the currency.

Comment: Think of the children - why the housing market has to change
Home ownership is becoming a far away dream for many who are not lucky enough to still be living with their parents at the age of 30 and saving every penny. Something has to give.

Women prefer to work in the home. Greeks are lazy. Gay men have truckloads of money, which just comes to them upon acquisition of their first “I’m a Homosexual” t-shirt, apparently. Such assumptions are untrue, unhealthy and structured in the same way as arguments, often advanced by guys who are supposed to be able to read a bar graph, against Millennials.

Now, Millennials are blaming Baby Boomers. Other journalists blame Generation X. All the while, everyone who is a non-Asian Baby Boomer, Millennial or Gen Xer starts blaming “the Chinese” on the basis of no information, and a government inquiry is started to revive that old Australian racism, because, heavens forbid, someone actually strain their noggin and look at economics as a system of organisation that evolves over time. No! Absurd house prices are due to people being “bad”.

It’s not as though there is not enough tribal hatred in our ridiculous age to add this stuff to the mix. It is not only out of compassion for those who have to face this stupidity—you’re a bad young person, a greedy boomer, a selfish Chinese millionaire etc— but my own desire to one day live in a house whose walls I can nail a picture of my grandmother to that has caused me to do the merest bit of straining.

Again. I ain’t no Helen Maynard Keynes. But I’m going to go out on a rental limb here and say that there is a relation between the cost of things that people buy and the amount of money people have. 

The reasons for the housing crisis—and it is a crisis that is already producing homelessness—are complex. They include negative gearing, the capital gains tax concession, sluggish land release, reprehensible lending patterns by the Masters of the Universe in Wall St, income inequality, the rise of the investor class, privatisation of public housing and…you’re not paying any attention, right. And who can blame you? It’s boring.

But, it’s also essential for some of us to be bored. It’s essential for our economic future, and for our cultural future, as well. If we allow ourselves to be deluded that this kind of person is responsible for our financial circumstances, we never see the big economic picture. If we refuse to see this big economic picture, we allow intolerance of the worst kind to thrive.

And few have a home and everyone hates everyone else. It’s enough to you cry, or smash a teardrop shaped avocado.

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