The governments plan to deregulate universities is a crime and its plan to require co-payments for medical services is absurd in the view of visiting Nobel prize winner Joseph Stiglitz. Asked by Fairfax Media to nominate the two biggest mistakes the Australian government could make that would take it down the American path of widening inequality and economic stagnation Professor Stiglitz nominated the budget changes to university fees and Medicare. Each would make Australia more like the US. Countries that imitate the American model are kidding themselves, he said. It seems that some people here would like to emulate the American model. I dont fully understand the logic. In the lead-up to the May budget Education Minister Christopher Pyne said Australia had much to learn about universities from overseas, adding: Not least, we have much to learn about this from our friends in the United States. Asked what Australia had done right that the US had not, Stiglitz replied: Unions. You have been able to maintain stronger trade unions than the US. The absence of any protection for workers, any bargaining power, has had adverse effects in the US. You have a minimum wage of around $15 an hour. We have a minimum wage of $8 an hour. That pulls down our entire wage structure. Professor Stiglitz said Australia had an education system that is really a model for the rest of the world. In Canberra as a guest of the Australian National University, he said deregulating fees would move the entire system in the wrong direction. Trying to pretend that universities are like private markets is absurd, he said. The worst-functioning part of the United States educational market at the tertiary level is the private for-profit education system. It is a disaster. It excels in one area, exploiting poor children. If youre rich your parents can pay the fees, but if you are poor you are going to worry about how much debt youre undertaking. It is a way of closing off opportunity and thats why the United States doesnt have educational opportunity. While we in the US are trying to re-regulate universities you are talking about deregulating them. It really is a crime. On healthcare Professor Stiglitz said Australia also had one of the best systems in the world. Why would anybody make reforms to try to make your system like the American system? he said. People dont make a decisions about medical tests and procedures based on price. Maybe for cosmetic surgery they do, but for poor people, price signals price them out. The typical inflation-adjusted income of a US household is lower than it was 25 years ago. The typical inflation-adjusted income of a male full-time worker was its lowest in 40 years. You have to say that the American market model has failed. Its a very strong statement for someone who believes in a market economy. Read more: smh.au/federal-politics/political-news/tony-abbotts-changes-to-universities-and-health-a-crime-absurd-says-nobel-prize-winning-economist-joseph-stiglitz-20140702-3b8ue.html#ixzz36LoC0aRJ
Posted on: Thu, 03 Jul 2014 01:25:32 +0000
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