Ideas@TheCentre – The Centre for Independent Studies


Ideas@TheCentre brings you ammunition for conversations around the table.  3 short articles from CIS researchers emailed every Friday on the issues of the week.

Employee risk and youth wages

20 July 2012

Are lower youth wages a form of ‘age discrimination’ in the workplace? Yes, according to three panellists at the NSW Young Labor conference on Sunday.

The ALP is considering abolishing youth wages so that workers between 18 and 21 years would receive the same minimum wage as adults. The argument that most resonated with the predominantly young audience was equal pay for equal work – the premise being that a young employee doing the same work as an adult should be paid the same wage as the adult. The fact that youth are paid less is age discrimination.

This argument does make sense at an intuitive level. Why should people doing the same work be paid different wages?

First, although young workers do the same work as adults, their productivity and competency levels differ. Adult employees are on average more productive and ought to command a higher wage. If young workers really were as productive as adults, then their wage would have risen to the adult wage. The fact that this hasn’t happened is telling.

The second reason – risk – is far more important but most often overlooked. Although there are exceptions, young workers are on average less experienced, less mature, and less responsible than their adult counterparts. They are also less accustomed to the demands and responsibilities of working life. I was a young worker until not too long ago and know this from my own experience.

Young workers represent a higher risk to employers. If employers had to pay young and adult workers the same wage without receiving adequate compensation for taking the higher risk, they would have no incentive to hire a young worker.

Young workers should be careful what they wish for. Abolishing youth wages effectively denies young workers the most effective weapon they have – lower wages – to compete against adults. Denying themselves this weapon means denying themselves a job.

Alexander Philipatos is a Policy Analyst at The Centre for Independent Studies.

When to move town

20 July 2012

I recently spent nine days driving 4,500 kms across remote NSW – from Wagga Wagga to Ivanhoe, Broken Hill, Wilcannia, Bourke, Brewarrina, Walgett, Lightning Ridge, Collarenebri, Moree, Boggabilla, Toomelah, and Dubbo. Aside from giving me an appreciation for how vast Australia is, the field trip also highlighted the changing fortunes of country towns.

The beautiful, old sandstone post office at Wilcannia conjured up more prosperous times when the town was known as the ‘Queen City of the West.’ Today, boarded-up shops with barred windows line the main street; only a service station, pub and a few shops remain open. Even the larger town of Broken Hill is showing signs of decline, with ‘for lease’ signs in front of many shops on the main street and old pubs and motels closed down.

Locals told me of the changes wrought by multinationals buying up land to grow cotton, irrigation depleting the rivers, the clearing of trees removing shelter needed to raise sheep, and the run-off from fertilizers and pesticides killing the weeds needed for oxygenating rivers.

The sides of the road across the Moree plains looked as though it had snowed recently because of the large amounts of cotton that had fallen from the bales on their way to cotton gins. Cotton farms now employ only a few people as just about every process has been mechanised.

Those towns that have found ways to adapt are doing slightly better. Although the opal industry has dwindled, enterprising locals in Lightning Ridge have found other ways to make a buck. One miner has transformed his 100-year-old mine into a gallery by carving more than 500 beautiful sculptures into its walls and enticing tourists with his creations.

Others, such as the Toomelah community on the site of an old mission 14 kms from Boggabilla, are clearly going backwards. Over the years, I have visited many different Aboriginal communities but I have never seen as many houses so obviously vandalised as those in Toomelah. Two out of three of the 50 or so houses had holes kicked into the walls, windows smashed, parts of the roofs missing, and graffiti painted over them. The sense of rage and despair in the air was palpable.

An article in the Sydney Morning Herald in May suggested the government was considering closing down Toomelah and relocating residents elsewhere. Tracker denied this was ever the case, and that the story was based only on the words of a frustrated government employee fed up with trying to improve a community resistant to change.

Whatever the truth may be, propping up towns artificially clearly is not working. Toomelah is no better off despite millions of government funding over the last two decades. The question that needs to be asked is, should government and townspeople let natural attrition and decline continue or should they do something about it? Residents of Toomelah, like many country folk before them, have to ask themselves why they want to stay and what is there for them in the future?

Sara Hudson is a Research Fellow at The Centre for Independent Studies.

Thought crime

Peter Saunders

20 July 2012

Last week, Westminster Magistrates’ Court in London staged a five-day trial (cost to the taxpayer: unknown, but doubtless staggering) at which Chelsea and England soccer star John Terry successfully defended himself against the charge that he had racially abused an opposing player, Anton Ferdinand, during a Premier League game last season.

Ferdinand told the court that during the game, Terry had called him a ‘c—,’ so he called back him a ‘c—’ back and accused Terry of ‘shagging his team mate’s missus.’ Terry responded with the words: ‘F—— black c—,’ although Ferdinand did not hear him say it. The incident was later posted on YouTube, and the Crown Prosecution Service (CPS) started a criminal investigation, resulting in Terry’s arrest and trial.

It was not the foul language that landed Terry in trouble. The word that put him in the dock was the only part of his utterance fit to print without asterisks (and the only bit that was descriptively accurate). It was the adjective, black.

Ever since 1965, incitement of racial hatred has been a criminal offence in Britain. This was incorporated into the 1986 Public Order Act, under which Terry was charged. This Act has subsequently been extended to prohibit incitement of hatred of religious and sexual minorities as well, so if Terry had referred to Ferdinand as, say, a ‘f—— Muslim c—’ or a ‘f—— gay c—,’ he could have found himself in the same sort of trouble (calling someone a ‘f—— bald c—’ or a f—— old c—’ is, however, not currently illegal, so bald old Brits like me have no statutory protection).

This case has given middle Britain a ghastly insight into the depraved culture of England’s sporting elite. Foul-mouthed men like Terry earn around £150,000 per week and are revered as role models by youngsters up and down the country. They are gross, yet they are treated as heroes.

What is more disturbing, though, is that Terry was brought to trial simply for the language he used. The case shows how Britain’s race relations laws attempt to control, not just what we do, but the way we think. Words betraying negative emotions about racial (or religious or sexual) minorities are illegal, regardless of whether they have any influence on behaviour.

It obviously makes sense to prohibit language intended to stir up violence, but that was never the case here. Terry and Ferdinand exchanged gross and abusive insults, nothing more. Yet Terry was arrested – not for anything he had done, but because he added that Ferdinand was black. That was enough to get him charged with what Orwell would recognise as ‘thought crime.’ It showed (in the eyes of the prosecution) that Terry was a ‘racist.’

In the end, Terry got off because the prosecution failed to prove that he had intended to abuse Ferdinand when he mouthed the words he used. But this case is only the tip of a monstrous iceberg, and others have not been so lucky.

Since 2000, UK schools have been required by law to report ‘racist incidents’ to the authorities: 30,000 incidents were reported in 2008–09, more than half of them from primary schools. Even though 95% involved only verbal abuse or name-calling, the CPS launched almost 3,000 prosecutions against children aged between 10 and 17 for ‘hate crimes.’

Sometimes I wonder what has happened to the country that gave birth to John Stuart Mill.

Peter Saunders is a Senior Fellow at The Centre for Independent Studies.