Quote:
Originally Posted by ssiguy
People often point to Aus/NZ of examples where an extremely high minimum wage is viable but it is not a fair comparison. The fact that they both have the 2 highest minimum wages in the world and the fact that they are the 2 most physically isolated countries in the world is not coincidence.
Aus/NZ can set economic polices that are vastly different because no tourist goes to either country without meg-bucks in their pockets because getting there is very expensive and far and hence no one goes there for a long weekend or one week vacation. Conversely Aussies and Kiwis don`t travel outside the country for short vacations either so more of their tourist dollars stay home.. They don`t have the issue of `if we are too expensive, people will go elsewhere for their vacations` like you do in the rest of the world. They also don`t have the problem of people crossing the border to buy cheaper goods.
It has also led to an outrageously high cost of living and put pressure on many key industries. Australia, like BC, has been living off of natural resources and housing for the last 25 years much to the detriment of other key sectors. Australia has managed to high-labour cost itself out of many industries and the key one is automotive. This year, the very last car manufacturing/assembly plant closed in Australia marking the first time in 110 years that Australia no longer builds any cars or trucks.............that is not a path Canada wants to follow.
As proof of their minimum wages not solving their equity and poverty problems, AUS/NZ both have GINI Indexes higher than Canada and most of Western Europe.
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Some of this is not true, speaking as an expat who lived in Aus for 5 years and recently returned home. Cost of living is simply not outrageous - though many in Aus are somewhat proud of their perceived high cost of living (if things are expensive here, that means we must be rich if we can afford them). Housing in Sydney is expensive, with detached house prices a bit below Vancouver's, apartment prices higher, and rent prices higher than Toronto's. Melbourne's home prices are a bit above Toronto's, while rent is less than Toronto's rent.
Meat/dairy/staple foods are cheaper in Aus, and eating out is cheaper, with tax included in prices and no tipping expected.
So is car insurance. Purchasing a car is slightly more expensive, unless you're purchasing a luxury car of over $60k, then a luxury tax is added that makes cars much more expensive. Income and sales taxes are lower, and there are no deductions on paycheques apart from a single federal tax. Gas prices are slightly higher than Toronto's, and lower than Montreal's.
Auto insurance is much cheaper, as are auto registration fees, as are mobile phone bills. Taking long distance trips on Sydney or Melbourne's extensive electrified train systems is way, way cheaper than comparable rides on GO/RTM. Domestic airfares are much, much cheaper. Welfare payments, administered federally, are much higher than those offered by any province in Canada. Finally, a Big Mac is cheaper in Australia than in Canada. The list goes on. Life is not more expensive in Australia, and those who think it is might also be the sort of people who still hold the 1980s/1990s view that Japan is pricey, even though inflation has been almost nonexistent since 1997 (net result: Japan is cheaper than Canada for just about everything).
The Fed and South Australian governments ultimately did not continue to prop up the automotive industry, although to be fair, that industry constituted a much smaller portion of Australia's GDP than it does for Canada.
Conjecture at this point, but I saw far fewer homeless people in Sydney and Melbourne than I do in Toronto, Montreal or Vancouver. I also liked having a friend who was a full-time worker at McDonald's and who didn't think an annual trip to Europe to visit family was unusual. She had 4 weeks of paid vacation, just like everyone else, and a liveable wage. Airfares are cheap these days, so why the heck not?