Growing Inequality – and a sign of resistance

The latest Stats NZ Household Income report has revealed that inequality in New Zealand continues to grow. The New Zealand Herald was very careful to split out a number of stories to get the best possible spin, but in combination the picture is stark.

The first story was about household income. The median household income (the middle of the distribution, rather than the average) is up $25 on the previous year, a 4.3% rise and the largest in 7 years! Hoorah! Key’s rockstar economy at work! However, this is in contrast to the average income, which increased by 6.2 percent, indicating that the bulk of the growth was in the take home wealth of the already better off. Specifically, it said the greatest increase in wealth over the year was experienced by white men, aged 50 to 54, living in Auckland. Of course, this is to a large extent code for “already wealthy” – it’s no coincidence that this is exactly describes John Key. Lucky them. The article also skipped quickly over the fact that the median increase in the hourly wage was the smallest it has been in 14 years. Adjusted for inflation, it represented a measly 0.1% increase. National claims that the number of people in jobs has increased by 70,000, yet this has done nearly nothing to reduce the precarious position of tens of thousands of New Zealand households.

However, Worry Not says the Herald, for our CEOs are doing just fine! In fact “Between the 2004 and 2010 financial years the average chief executive salary package ballooned by almost 80 per cent.” Those who manage New Zealand’s largest companies took home an average of $1.4 million last year, an increase of 4%. This means that on average they take home approximately 25 times that of the average NZ salary – an already poor comparison since that average includes the outliers that these top CEOs represent. The highest paid, ANZ’s David Hisco, last year made more than four million dollars. More on that in a second.

Meanwhile, an ever increasing number of people living in new Zealand are being forced out of their homes and onto the streets. Increases in rent have seen the number of families spending more than 40% of their income on rent double over the last ten years, it nearly 1 in 4. Put another way, 23% of renters are spending more than 40c from every dollar they get in simply keeping a roof over their heads. 90,000 households spent more than half their income on rent, and some in South Auckland are spending even more 70%. The number of people on the “urgent” Priority A Housing Placement list has skyrocketed over the last 2 years, up nearly 700%. In Christchurch, the housing shortage is critical, and we’ve already seen the tragic consequences of the desperation that this has caused in the Ashburton WINZ shooting.

Clearly, the issue of inequality and poverty is approaching, if not already fallen over, a tipping point. Fortunately, all is not lost. Despite promises from the newly victorious National party to further gut the Employment Relations Act, making it more difficult for unions to organise and bargain effectively, there is reason to hope that unionists are stepping up. ANZ staff, for example, have been taking various creative forms of industrial action over the last week, culminating in an overwhelmingly successful vote for national strike action on Monday (06/10/14). ANZ, with their record setting CEO and $1.37 billion in profits last year, have not only offered the most insulting pay rises (2-3%) barely greater than inflation, but are also demanding significant casualisation which would mean workers didn’t know from one month to the next how many hours they would have or what hours they’d be expected to work. Staff rejected this “offer” and have been engaging in a range of forms of opposition, including subtle acts of solidarity. It appears nation wide strikes will be in the near future. ANZ stocks took a hit with the announcement – even the stock market knows that employers should beware the power of angry workers.

We have no expectation of any help from National. The attacks they have already promised are going to be brutal. Our unions, the widest expression of class unity we have at present, are the best weapon we have as a class – not only to defend people currently in work, but also to protect beneficiaries and those who have been pushed outside of even that. With poverty and disenfranchisement at record levels National wants to demolish these foci of class strength for a reason. For thousands of New Zealanders, the questions of poverty and inequality are not academic. We need to be making the arguments in our workplaces and in our union meetings that these are issues that we need to be making a fuss about, beside our own pay and conditions. National wants to keep us all as divided and precarious as possible. They want to create a future where the vast majority of us live and work to benefit the already wealthy. The way we not only reject this future, but fight for real equality beyond the confines of Labour vs National, is by building unity in our workplaces and in the streets. The fight isn’t over just because the polls are closed.