Tuesday, March 17, 2009

The GFC hits the GDP of the OECD!

Once you locate Australia on a map of the world, you might be struck at how removed it is from the rest of the world. It seems to be drifting between Asia and Antarctica, framed by the shattered necklace of the Indonesian archipelago and PNG to the north, with New Zealand offering a bit of assistance to the east. Being so isolated from the major countries of the northern hemisphere has had a profound effect on the history of this strange place, floating somewhere in the southern Pacific Ocean.
But, as we keep being told by the economists and politicians, no country is an island anymore, even a large island continent like Australia. The Global Financial Crisis has spawned its own acronym, as sure a sign as any that this phenomenon will be around for a while yet. The suddenness of the collapse of credit has crippled huge companies and governments in a few months. I'm sure that many doctoral theses are being written about this right now by MBAs at the Harvard Business School.
For those of us down near the bottom of the economic food chain, this collapse is nothing but bad news. I have a lot of practical experience in different professions, but not much in the way of formal qualifications. Most middle management or management positions require a piece of paper. I don't have that. Finding a job which offers some challenges and a reasonable rate of pay was hard enough before this GFC hit, but now it's worse. Employers are nervous about hiring new staff; many skilled professionals who used to work in finance, IT and engineering are looking around for something to do; youngsters out of school are now competing with their parents for available work.
I heard a rather poignant story on the radio this morning from the USA, where tens of thousands of new unemployed are appearing every month. Proud people, who have worked hard to get where they are, often having to overcome real prejudice, now find themselves, for the first time in their lives, standing in line at the dole queues. The interviewer spoke with a lady who sounded like a middle-aged black person. She had worked at the same company for 16 years. In the space of one cathartic day her world had been turned upside down. She was the sole wage earner in her family, which included 3 young kids. She cried as she told her story - her pride disappearing as she stood in line with all the others.
Perhaps I can empathize with her more, now that I have gone through the same process. It was about one year ago that I found myself at the local CES (Commonwealth Employment Service), also standing in line. I was 51 years of age. This was the first time I had ever applied for unemployment benefits, and it was yet another blow to my fragile ego. I stood there looking at my fellow attendees: guys with tattoos running up their legs; migrants with little English; young kids who were just out of school; and my self-centred thoughts were, "what the hell am I doing here with these people? I'm better than them, surely. I have run a business. I have worked overseas. I have employed people, paid my taxes, and been a good provider for my family. These people look like uneducated bums."
Ah yes, we humans have an amazing gift at being able to rationalize just about anything which happens to us, and our egos can turn these events to our favour.
When I had filled out the forms, I was directed to a CES person who explained the procedures to me. He was direct, knowledgable and spoke quietly. I appreciated his manner and demeanour. His would not be an easy job.
I was given a job diary, into which I was required to enter details of jobs which I had applied for. This diary would be reviewed, and if I wasn't applying for sufficient jobs, and showing proof of my serious attempts to get those jobs, then I would be in default of my obligations. It took a while, but the money I got was a great help during a difficult period.
My rational friends said things like, "you shouldn't have a problem with claiming some money back from the government. After all, you've been paying taxes for years." True, but it still felt awful. I had failed in my self-appointed role as financial provider for my family.

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