ASX Share trading game 2 for 2021 open!

Hi all! I am entered into the Australian Stock Exchange Share Trading Game 2 for 2021. Entries are open until 8 October 2021, but the game has already started so for best chances to win join now. You will be given a hypothetical portfolio of $50,000 to trade with, and choose between over 200 stocks and ETFs listed on the Australian Stock Exchange. There are even cash prizes and it is a great way to learn about how to invest in stocks, how to research different companies, and how things like brokerage costs affect your total returns.

There are two separate competitions depending on you age: one for high school students (I believe you need your teacher to enrol you in the game) and one for people aged 18 and over.

Join me today and lets follow each others’ progress!

Where to join: https://www2.asx.com.au/investors/investment-tools-and-resources/play-the-sharemarket-game

To join my league and compete with or against me in the game please follow these instructions:

You are invited to join my ASX Sharemarket Game league

To join:

1) Go to the new ASX portal – https://www2.asx.com.au

2) Select Login

3) If you are new to the Game and not previously signed up to MyASX, select “Join Now.”

4) If you are a previous MyASX user, login with your MyASX username and password and you will be prompted to update your password.

5) Once you have logged into the portal, select the ASX Sharemarket Game and register for the Game.

6) To join the league

Under the “Game play” menu, select “Leagues” and then “Join leagues”.

Enter in the details below:

League ID: 34343

Password: ChaiTime1

You will be joining the league: EconomicsWithCoffee

6) And that’s it… success

You have now successfully joined the league.

The Big Short

The Big Short by Michael Lewis

I read Michael Lewis’ The Big Short a few weeks ago. This book is fantastic. I recommend! If you are time poor, the film with Ryan Gosling is also excellent. I watched the film twice and find myself re-reading the book in 2021. The Big Short discusses the financial reasons and foundations behind the housing crisis that precipitated the Global Financial Crisis (GFC) in 2008. In Australia we call it the Great Recession, but internationally it is known as the GFC and took more than a decade for the world to start to recover from, and then we suffered the 2020 pandemic recession.

The Big Short focuses on the perspectives of the few people that saw a problem in the way mortgages were being traded behind the scenes of the worlds major banks, and a pricing error on risk that lead to the biggest failure in the banking system since the Great Depression.

There are interviews with many people from both sides, but understandably more from the sides that were betting against the banks mortgage backed securities and the derivative products made with them. A derivative is something that is made from an underlying asset, and the underlying asset in this case was home-loans of people who would later come to be known as NINJA’s — no income, no job, no assets, as well as the home loans of people who had no paperwork to prove their income — “no-doc loans” and “low-doc loans” that mostly turned out to be NINJA’s too.

There is so much depth and detail that it takes a second reading really to take everything in. The access and interviews in the book are rare and interesting. It’s very well written and possible for someone with a non finance background to follow. All the financial jargon is explained well for a non specialist audience. I feel it is important reading now, with the US Fed buying mortgage backed securities and house prices in another boom.

A Letter to Australia’s Prime Minister

This is a cruel policy to withhold covid relief support from income support recipients published today in The Guardian Australia.  Your policy is putting hundreds of thousands of people’s health and well-being into the garbage. 

Your policy basically says: “We don’t care if you become homeless.  We don’t care if you starve to death.  We don’t care if you die in the gutter.”

You need to immediately include all income recipients including Parent Payment, JobSeeker, Youth Allowance, Austudy and Abstudy. The people who applied for these payments to supplement casual income in weeks their working hours dropped are not greedy, they are sensible. Many of these people live pay cheque to pay cheque and if they did not take responsibility by applying for government income support they would put them selves at risk of homelessness and this would cost society a whole lot more than their social security benefits.

If you don’t extend the help to these people, the consequences for social stability are going to be dire.  We will see an increase in morbidity and mortality.  How can you justify this when there are as few as 75 affordable private rentals for someone on the sole parent pension in the entire country and a 10+ year waiting list for social housing in cities like Sydney. 

Your government needs to immediately implement a building program using the $3 bn you have under NHFIC and actually implement this funding to build the 500,000 affordable homes Australia needs.  Until people can actually live on the absolute pittance this government calls welfare, you must include any casual workers who also receive income support in your scheme.

This policy is obviously based off of misguided ideology.  Stop pretending this is justified.  Milton Friedman and John Maynard Keynes were both on your side of politics, and both would have warned you about the terrible consequences of this policy.  All you are doing is pushing voters to vote Green. Pushing voters to vote Labor. You have proven that you don’t care about Australian people, and people are not stupid.  The can see what the government thinks of them.  People on “the Dole” are no longer a minority.  So many people will experience what the Dole is really like now, experience the hunger, and the Australian people I suspect will demand better social security in this country, just like Keynes suggested after the Great Depression and the War.  If you ignore this, you and your friend’s way of life will be destroyed.  The whole point of having an adequate social security system is to

1. Keep the workforce healthy and in homes even when they are out of work. 

2. Give people options to find good quality well paid work. 

3. Prevent social unrest that lead to increased crime and higher chance of revolutions. 

You and any politician should best remember any society is only three meals from revolution.  This is your “Let them eat cake” moment. This is just bad policy. 

JobSeeker needs to be permanently raised. We need to build 500,000 affordable homes.

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What Australia needs going forward is a decent and fair welfare safety net. Not a punitive one.  We need to take care of each other and not allow people to live in relative poverty in Australia.  The JobSeeker rate should be permanently raised to its current coronavirus #covid19 level.  We don’t know that all those jobs that were lost will be recreated.  We don’t know the economy will reset.  What I do know is that people cannot live above the poverty line in Australia on ~$300 a week if they have to pay rent. That is just a reality.  If we return JobSeeker to the previous Newstart rate, we will I think, risk much higher homelessness, inequality, and relative poverty of young people, and increasingly families and children in Australia.

If you are living in poverty — how are you to find your way out of it without a helping hand?  I hope that if coronavirus has taught us anything is that these social safety nets were created after the war for a reason.  We should work as a society and care about each others welfare.  Every person is important.  Every job is critical. Government and super funds should be investing now in the 350,000 to 500,000 affordable housing needed in cities across Australia.  People need a safe place to live and they need work.

We are currently building only 3000 affordable dwellings a year (1).  A flaccid and weak attempt to deliver what the nation and it’s people need.  A failing on our people. Impotence in the investment into affordable housing over the last 25 years across the the nation has a created a shortfall of 433,000 homes (1).  Just mull on the number for a while, 433,000. That is almost half a million homes that should have been built already.  Homes we needed yesterday.  Homes that would help millions from falling into poverty.  Homes that would raise hundreds of thousands, maybe over a million, in this country out of poverty (2).  Just before the pandemic hit, there were 3, 000, 000 — that’s 3 million people — in Australia living in poverty, that is  1 in 8 adults and 1 in 6 children.  Living.  In.  Poverty (2). With another 1 million unemployed now, that number could rise substantially, maybe by a quarter or even double if something isn’t done soon.

The nation needs stimulus — right now — at this moment. What better thing could we as a nation do than secure the future safety of shelter to our young and at risk populations?  I can’t think of a better way to stimulate the economy.  Much better return in the long run than tax cuts to big companies that we, at this time, can’t afford.

The picture I chose for this article is a wonderfully beautiful Art Deco — Depression era building in Sydney. An example of one of the many fine structures built back then.  We can build to stimulate our economy.  We have done it before.  We just need to prioritise what we need.

(1) Julie Lawson, Hal Pawson, Laurence Troy and Ryan van den Nouwelant https://theconversation.com/australia-needs-to-triple-its-social-housing-by-2036-this-is-the-best-way-to-do-it-105960 date accessed 10 May 2020

(2) Acoss. Poverty in Australia. Is there poverty in Australia? URL: http://povertyandinequality.acoss.org.au/poverty/ date accessed 10 May 2020

What is Competitive Advantage?

So if we are not using Tariffs to artificially boost our competitiveness, how are we meant to make money with international trade?

Competitive advantage is the principle that a country will produce something it better at producing than anyone else. It could be a pricing advantage. Maybe the country has low wages and can make goods cheaply. It could be a technological advantage. The country could have advanced technologies that other countries do not know how to use as well.

In the Perfect Capital Market, a place with no taxes, government and free trade (think  Capitalist), countries produce what they have a competitive advantage in. The country will sell some of those goods as exports to other countries. The other countries will trade goods that they have a competitive advantage in.

For example, imagine a world of only two countries. They are called the United States and Australia. The United States is really good at making computers. The United States makes the best, most advanced computers in the world. Far better than what Australia can make. The United States has a competitive advantage in computers. Australia has a competitive advantage in solar panels. Australia’s solar panels are the most efficient in the world.

Australia produces solar panels at a cost of $10 and exports them to the United States. The solar Panels are sold to the United States for $20. The United States uses those solar panels to make it’s computers at a cost of $10. The United States exports it’s computers to Australia who buys them for $20. Australia in turn designs even better solar panels. Both countries are trading where they have a competitive advantage. Both countries benefit. In this case they benefit equally. Each country makes $10 profit.

What if there was a third good? Wheat. Both the United States and Australia are good at producing wheat. Australia is really efficient at producing wheat. The United States wants to trade it’s wheat with Australia instead of computers. Australia has cheap wheat because it is so efficient at producing wheat. Wheat costs $5 to produce in Australia and is sold for $10 in Australian shops. Australia will only pay the United States $10 for it’s wheat.

Wheat in the United States costs $6 to produce. The United States will only make $4 profit in Australia but Australia will make $5 profit. Australia has a competitive advantage for wheat. But it is small. The United States can try to sell it’s wheat to Australia, but it will never make as much money selling wheat as Australia. Eventually Australia will be ahead as all those dollars start to add up.

What would the United States be better off producing to make the most possible profit? Computers. Because that’s where the United States has a competitive advantage.

So what is a Tariff anyway?

There is a lot of talk about the US and China and other countries raising Tariffs against each other. So what is a Tariff anyway?

A tariff is a kind of tax placed on imports, sometimes from all countries and sometimes just from one country.  Usually trade arrangements are made between two countries so the tariffs will be at a country level.

In the past most countries had a lot of tariffs, sometimes really high ones.  These taxes encouraged people to buy goods made in their home country rather than imports with expensive taxes on them.  In Australia this system propped up the Textiles, Clothing and Footware industry until reforms were made and the tariffs reduced to almost zero, and in some cases zero.

Tariffs fall under an economic strategy called trade-barriers or protectionism. Protectionism aims to protect the home countries industries, even if they are not competitive and would not survive without the taxes on their competitors.

While tariffs are perhaps good for companies that are in protected industries, and they can continue to employ people, protectionism is bad for consumers and often forces them to pay more for the things they want to buy. In the 1980’s the cost of a T-shirt was much more expensive than the cost of a T-Shirt today.  Wages of factory workers in Australia were and still are much higher than wages in China and other manufacturing competitors, and so consumers in Australia were forced to pay more for their T-Shirts.

If you only have $100 to spend and a T-Shirt is $50 it only leaves you with $50 to spend on other things.  If there are no Tariffs and the T-Shirt is now $40 you have $60 left to spend on other things you want.  Basically you can’t buy as much under protectionism.  In Australia the price of a T-Shirt got much cheaper than $40, because eventually the foreign goods were so much cheaper and more competitive than the local goods. This soon put most of the Textiles, Clothing and Footware industry out of business.  That isn’t necessarily a bad thing,  it’s bad for a while for the people who loose their jobs, the factory owners and their investors. But remember, those factory workers were also having to buy a $50 T-shirt under protectionism, and now they don’t have to spend as much either.  The businesses were not competitive and were being propped up by an artificial advantage.  Generally the standard of living of people increases as protectionism is removed.

However like all things, it’s not black and white and not all people benefit equally from removal of trade barriers. Governments role in this type of situation where there is a massive restructure of the workforce due to change of government policy is to help affected workers find new jobs.  A task government doesn’t always get right.  It is also the responsibility of Industry to be open to employ people from declining industries and to the workers themselves to retrain or gain new skills.

These kinds of changes are worse when they are implemented too quickly, without time for people to adjust and find new work.  Another thing that can exacerbate the situation is when protectionism is removed when there is no other work around.  This can turn structural unemployment, as it is called, into long term unemployment.  This makes life very difficult for workers in affected industries. They may never find employment again. Due to unemployment they do not benefit as much from the rising living standards as people who remain in work gain from removing tariffs.

Portfolio diversification: Starcraft analogy

My 11 year old is a big fan of Starcraft II, a strategy computer game. If you know the game, you will be aware there are two resources in the game, Vespene Gas and Minerals.  Units in the game can collect these resources and use them as commodities to build new items, or as currency to finance acquisitions, for example fighting or healing units in one of the three armies, Zerg (Alien insects), Protoss (A highly advanced alien race) or Terrans (Humans).  The resources Vespene Gas and Minerals are valuable and necessary for any successful Starcraft II army.  Especially if you want to have success in the game or annihilate your enemy’s bases.  Successful armies require Vespene Gas and Minerals so there is always a market for these resources.

If I was an investor in the Starcraft universe, I would have two possible resources to invest in, Vespene Gas or Minerals.  If I bought only Vespene Gas, my investment portfolio would contain one thing: Vespene Gas.  Say I invested only in a Zerg Vespene Gas field I would have only the risk attached to owning a Zerg Vespene Gas field.

If one day the Protoss came along and blew it up, and blew up all my harvesting units, I would loose all of my investment.  I would have nothing and be all of a sudden very poor.  If I  had instead put only half my assets into the Zerg Vespene Gas field and the other half into a Terran Minerals deposit I would have reduced my risk.  My portfolio would be half Minerals and half Vespene Gas. I would still have my investment in the Minerals even if the gas field was destroyed. I would only loose half of my investment.

By investing in both resources I am spreading my risk and hopefully by doing so reducing my total investment risk. This is why it is so important to build a diverse portfolio and why people say “not to put all your eggs in one basket”.  That is why it is unwise to only invest in Vespene Gas.

 

*Note: This is a very simple example of portfolio diversification for demonstration purposes only. It should not be taken as investment advice. At the time of writing I do not and have not previously held stocks in Blizzard Activision (or Vespene Gas for that matter!)

To Create Gender Equality in STEM Workplaces Must Change.

Source: ScienceMag.org. Data from the Third European Report on Science and Technology, 2003,http://www.dife.de/~mristow/2003EU_3rd_report.pdf

What can the disciplines of science, engineering and technology do to increase their female workforce and stop the well documented drop-off of women from the workforce over time?  In the fields of science and technology (STEM) the phenomenon of the so called Gender Scissors or “Jaws- of-Death” or “Scissors-of-Death” is widespread.  The Jaws-of-Death phenomenon is a measurement of male and female participation rates in the disciplines of science and engineering throughout their careers, measured by age.  Due to encouragement of young female students to study STEM subjects in high-school and increased enrollment of female students in STEM courses at university, the gender gap has closed significantly over recent years and almost closed completely in some sciences at this early career stage.  However looking into the future lives of female and male scientists and engineers, female participation rates drop off significantly in comparison to male participation rates.  The Jaws-of-Death graph blatantly shows the loss of women from the field of science and engineering as they age.  In scientific academia there is a marked difference between female and male participation rates, in the EU, only 33% of researchers are female and only 21% of top level academic roles were filled by women in 2015 (1).  In science and engineering the number of women in in top level positions is even scarcer at 13% in 2013 (1).

There are a number of reasons this may occur, but the most startlingly obvious reason is that these professions are not easy for women to stay and to excel.  There are a number of factors in these professions that affect women’s participation rates.  Much the way business is done in these professions means that the odds are stacked against women right from the start and opposing factors only increase against women as they age and try to progress in their careers.

This should not be seen as the fault of women but as a fault in the system. By loosing such large numbers of women from STEM or keeping women subjugated to lower positions due to the ingrained workings of a poor system, the system in place is in effect causing a “brain-drain”, a loss of potential, and a loss of economic benefit that would have been gained if those women were able to stay in STEM related work or to advance their careers.

So what are the major obstacles in the system that women have to overcome?  There are much documented and studied obstacles such as unconscious bias and the gender pay gap, but there are also more physical boundaries such as the availability of maternity leave and flexibility for employees in the workforce.  Business holds a lot of the cards when it comes to negotiating workers hours, and the fields of science and engineering have very low unionisation rates. Low unionisation means women will often be left to negotiate their contracts one on one with an employer, and they will be expected to offer similar hours of labour as male employees if they want to receive coveted roles or permanent positions.  Because of a desire by many women for flexibility, they are often forced by lack of choice and lack cooperation by employers into precarious part time contract and casual work.

The professions of scientist and engineer were male dominated occupations for centuries.  The fields have consequently developed into occupations where it is standard for employers to expect very long hours of work and high output.  Hours of work far past your standard 40 hour week. Many scientists and engineers work weekends as well as week days, and might work away from home for months on end.  As a consequence of this high benchmark for permanent positions, people who want flexibility have much lower bargaining power and much less chance of finding secure work.

There are a number of problems for women trying to work inside this construct. For starters, flexibility is very important for many women, and not just women who have or want to have children.  Many women require adequate recreation time to perform well, and don’t want to work more than 40 hours a week.  Women who are planning a family or have children want to be able to balance their family and work life without risking their career.  It is well known that many women feel they are forced out of STEM professions after having children.  In general, only women with a lot of additional support from their partners, family or already in well paid positions find it possible to stay in STEM after having children, and even then they often talk of it being a struggle.  When you talk to mothers who have been successful in science and technology, they have usually had very supportive husbands, partners or parents who were able to help a lot with children or have been able to afford nannies.  Women who don’t have support, which far out number those with sufficient support are the ones who drop out, and they are dropping out in huge numbers.

If the structure of work could be changed it would benefit not only women, but men who also suffer from being away from home and family for long periods.  For example, the field of academic science is highly competitive.  Scientific teams work long hours and are in metaphorical vicious and eternal competition with their scientific rivals to produce quality novel research and to produce it first.  Academic scientists compete with each other for accolades, for grants, for jobs and for recognition by their peers.  This has built an environment of extreme individual competitiveness where scientists often feel they cannot risk taking time off for fear of falling behind.  God knows, some team in the US or China might make the discovery first!  God forbid they might publish first!  Young academic scientists want to be the lead author, to gain the recognition they feel they deserve, to be Joe Blogs, et al. and not be one of the seemingly unrecognised and forgotten “et al.”, just a footnote at the end of a paper, a name no-one will ever remember.

Other reasons for leaving work in STEM are also commonly sighted, such as nepotism and “jobs for the boys” at higher management levels.  These problems could be addressed by stricter hiring criteria based on merit rather than favouritism, friendship networks or poor interview based character assessments.

I suggest that if the field of academic science could be completely restructured and more value put on people as a whole rather than on an individuals output, not only would women be able to stay in STEM, but the increased workforce and increased diversity would surely improve science.  This would mean a greater emphasis on a teams output rather than on individuals trying to outshine each other.  Increased availability of job share and flexibility so that two or three scientists could perform the work that one scientist working a 60 or 70 hour week currently performs.  A greater emphasis on sharing knowledge and working together as a group rather than on gaining individual recognition.

To achieve this a number of elements in science need to change, from the way scientists are hired to the flexibility afforded to scientists in the workforce, and the way that academic journals publish scientific papers and grants are distributed.  There needs to be is a greater focus on quality teams rather than bright stars. If everyone is chasing their Nobel Prize or equivalent, a situation of survival of the fittest arises and many bodies will be pushed aside.

How fitting that academic science has become a prime example of Darwinism.  But it doesn’t have to be this way. We can change. I read a sign recently that said in my loose translation from Dutch “Expecting change, without doing anything yourself is like waiting for a boat at a train station”.  We can make STEM work more accessible to women (and men) but change needs to occur and people and organisations have to be willing to make change.

We can’t expect women to stay in work in a deeply flawed system. And we can’t expect the system to change on it’s own.  We have to see the problems and be willing step up and fix the system so that it better serves us and helps us to build the kind of society that we want live in.  A society where women can be successful scientists and engineers and don’t have to overcome massive hurdles.  A society where the decision whether or not to have children will not massively impact or end your future career.  Having children or simply being male has never stopped men from being scientists or engineers and parental status or gender shouldn’t stop women either — and if it does, we have to change that.

1. SHE Figures 2015, URL: http://www.genderportal.eu/sites/default/files/resource_pool/she_figures_2015-final.pdf date accessed 25/6/2018.

Housing affordability in metropolitan Australia

Why are houses today too expensive to buy for the average person and especially young people in our major cities? Are elements such as negative gearing and overseas investors that are often blamed for the rising prices in the media and by politicians the cause of the inflated prices? Or is there something else that has caused the inflation? The short answer is yes. Yes there is. And quite simply it’s supply.

Demand and supply are two elements of the market that are directly linked. If demand is high and supply is low, prices will be higher. If supply is high and demand is low, prices will be lower. The problem in cities like Sydney is that there is a short supply of housing in areas where people actually want to live. Homes that are of a good size (2-3 bedrooms a good size if you are planning a family), in nice neighborhoods, close to schools, medical centres and hospitals, close to public amenities like parks and swimming pools, close to public transport and within a short commute from places of work, which for a city like Sydney is the CBD.

Over past decades new homes have been predominantly built on the outer fringes of the city, which has stretched our cities of Sydney and Melbourne to massive sprawling suburbia. As you head out into this sprawling suburbia land sizes of individual blocks of land get larger, houses get on average larger and are more spread out. The suburbs get larger, amenities are more spread out, hospitals are further away, work is much much further away, everyone requires a car just to do things like go to the shops or take the kids to school, because everything needed for life is so spread out.

This in turn means that the next set of new houses built is pushed even further again from the city centre. The toll of this on people buying their first home, is that they are forced to have a much lower standard of living than those closer to the CBD because they have to spend a lot more time commuting to the city to work in the morning and home again each evening.

People living on the city outskirts will spend several hours a day either in their car or on the train or bus in long commutes.  People living on the fringes often rely on cars to drive everywhere and therefore spend a lot more on petrol for their cars, as well as the other costs involved in car ownership, compared with people in the inner city who often don’t need a car and thus save money on not running a car. Former Liberal Party Australian Treasurer Joe Hockey infamously said in a radio interview in 2014 “The poorest people either don’t have cars or actually don’t drive very far in many cases” (1). In fact it’s the opposite, most “poor people” do drive cars and the costs of running a car helps to keep them poor. “Poor people” who live on the city outskirts tend to drive much further than those who live in the centre, who tend to be wealthier (2).

Houses are generally larger and temperatures in the west of the city are hotter than by the coast because they don’t receive the cool sea breezes, so electricity costs are higher as homes require air conditioning to remain pleasant to live in.

Long commutes are a waste of peoples time, and seriously cuts into peoples recreation time. Time that could be spent with family or friends. High electricity bills and costs of running a car that is used everyday cuts into peoples ability to save money or spend on items to make their life more pleasant.

The short supply of housing in the inner city has pushed house prices up so high they have become unobtainable for people that did not already own a home in Sydney. In the suburb I live in, Marrickville in Sydney’s Inner West about 6 km from the CBD, the median price for a 2 bedroom house is now $1.23 Million (3). The median price means the price in the middle, it’s a bit like the average but a better indication of the middle price people are paying for homes.

In comparison the median price for a 2 bedroom house in Campbelltown, a suburb on the outskirts of Sydney’s western suburbs, is $476 thousand (4). People who live in Campbelltown and work in the city centre will commute for at least 2 hours a day.

So why is a 2 bedroom house where I live so much higher than that of a 2 bedroom house in Campbelltown? The simple answer is demand. There is high demand for houses in suburbs like Marrickville because they are convenient place to live, we have schools, public transport (trains, buses and close connection to light rail), medical care (like GPs, specialists rooms, dentists, radiography services), grocery shops and a shopping centre all within walking distance from homes. There are top hospitals and universities like RPA and The University of Sydney and University of Technology Sydney only 4-5 km away. For people with disabilities there is more access and choice when it comes to disability services. Suburbs closer to the city tend to have more people around and so there is often a greater sense of being in a community than out in the outer suburbs where you can often feel isolated in your street or home. There are cultural and community events in the inner city like weekend markets and theatre, all of which make life more enjoyable in the inner city. Another reason for higher demand in the inner compared to the outer suburbs is that crime rates tend to be lower in the suburbs closer to the city, obviously with a few exceptions.

In my opinion, more focus needs to be on increasing the supply of homes in the CBD and inner suburbs of cities (within 10 km of the CBD), because this is where people want to live based on price data. Yes, people who are already lucky enough to live in the inner suburbs will argue “But there aren’t enough schools! There aren’t enough hospitals! Over-development! I don’t want high rise apartments over looking my house!” . Government has tried to to increase supply and there has been massive backlash in these communities about any new development. This viewpoint to me seems very selfish and short sighted.

My question to those people resisting development and resenting newcomers is, why do you think that you deserve to live in a convenient area, but other people do not? Is it fair that just because you were there first, future generations are forced to live at a poorer standard of living and have to live in an area which is not good for a productive economy because of the high costs on it’s residents, because you were here first? I don’t think that is either fair or good for the economy or society. It ultimately increases inequality in society.

Census data helps governments to determine the number of hospitals and schools built in an area. If more people move to an area, government will see in the Census that the area requires more infrastructure. If zoning laws are changed to allow more housing to be built in the inner suburbs, government can also plan to deliver more hospitals, schools and public transport, for example the new Sydney Metro line going up along the Bankstown line (one of the two main train lines through the Inner West of Sydney) coincides with the opening up of zoning for high rise residential apartments along the Bankstown line corridor.

In the past, and even in the present the most creative and productive areas of cities are not the outer fringes but the more highly developed inner city. If we want to make productive cities we need to make them more livable, which includes increasing the sustainability of our cities by reducing the number of petrol cars on the road, and increasing the happiness of residents by decreasing commuting times and the cost of living.

Reference

1. URL: http://jbh.ministers.treasury.gov.au/transcript/075-2014/ date accessed 12 June 2018.

2. URL: http://www.abc.net.au/news/2014-08-15/joe-hockey-poor-people-cars-claim-misleading/5671168 date accessed 12 June 2018.

3. URL: https://www.domain.com.au/suburb-profile/marrickville-nsw-2204 date accessed 12 June 2018.

4. URL: https://www.domain.com.au/suburb-profile/campbelltown-nsw-2560 date accessed 12 June 2018.