Rising reliance on personal income tax signals need for bolder reforms


Phil Lewis, University of Canberra

The Parliamentary Budget Office (PBO) has just released a report on trends in Commonwealth taxation receipts. While supporting the expectations of a budget in balance by 2019-20, it exposes worrying trends in the balance of the burden of taxes in Australia. In particular, its analysis of trends in the composition of tax revenue identifies an increasing reliance on personal income tax.

The PBO shows that tax revenue from labour (mostly income tax) was 8.6% of GDP in 1971-72. By 2015/16, this had risen to 12.6% of GDP. Over the same period, tax collections from capital (mostly company tax) as a percentage of GDP was virtually unchanged, from 3.3% to 3.2% – although this increased noticeably during the “economic boom”, which ended when the Global Financial Crisis (GFC) hit in 2007.

Taxes on consumption (such a GST and excise duties) were 5.3% of GDP in 1971-72 and 5.7% of GDP in 2015-16. While the introduction of the GST in July 2001 raised consumption taxes temporarily, revenue from both GST and particularly excise taxes has been in decline as a percent of GDP since.

Figure 2 from the report shows these trends over the decades.

Trends in revenue from categories of Commonwealth taxes.
Source: ATO data and PBO analysis

The main emphasis of the PBO report is on the period since 2001-02. The chart below shows the increased reliance on income tax and declining importance of taxes on consumption and capital.

What is driving these shifts?

The main reason for the rise in income tax revenue is “bracket creep” as incomes increase and taxpayers move into higher marginal tax brackets. This is due to successive governments not fully indexing tax brackets to increases in CPI or average earnings.

Meanwhile, consumers have been changing their tastes and responding to prices by altering their consumption patterns. The so-called “sin taxes”, or rates of excise duties on alcohol and tobacco, have increased significantly over time.

This has been particularly true for tobacco where the volume of consumption has fallen as fewer people smoke and those who do smoke less. However, the percentage fall in consumption has been less than the percentage rise in tax, so tobacco tax revenue has risen.

For alcohol, consumers have been switching from more highly taxed beer to wine, which is more lightly taxed. For instance, a full-strength beer from your bottle shop carries a tax of $37.10 per litre of alcohol. A moderately priced bottle of wine bears a tax less than half that ($17.60 per litre).

What might be considered a distortion in the taxing of alcohol means that changes in tastes towards drinking wine reduce tax revenue. The system of taxing alcohol is distorting in that encourages changing consumption habits away from beer drinking to wine.

Fuel excise is levied on a number of fuels but revenue comes mainly from petrol sales. The indexing of fuel excise rates was abolished in 2001 before being reintroduced in 2014. This reduction in the real excise rates was accompanied by significant reduction in the volume of fuel per household, from 11.4 L/km in 2001 to 10.6 L/km in 2016, as vehicles became more fuel-efficient.

The combination of reduced real excise rates and reduced consumption have reduced fuel excise revenue as a percentage of GDP.

The GST, one of the principal aims of which was to provide a broadly based growth tax, is declining in relative importance. This is mainly due to the exemptions from the GST base. For instance, spending on education and health, which are exempt from GST, is growing faster than spending on other goods and services. There is also some loss in revenue due to online purchases from overseas, which the government is trying to address.

As the share of consumers’ spending continues to switch from GST-liable to GST-exempt items the share of GST revenue will continue to fall.

Company taxes have diminished in importance in Australia and elsewhere because of the way multinational companies can arrange their tax liabilities across national borders to minimise tax. However, there is also worldwide recognition of the need to reduce company tax rates because of the detrimental effects these have on investment and growth.

The need to cut ‘deadweight loss’

When discussing taxes economist often refer to “deadweight loss”, which is the loss to the economy over and above the amount recouped in tax revenue. When revenue is taken from individuals or companies this results in less of a service or good being produced.

It is argued that governments should put more reliance on taxes that cause less distortion – less deadweight loss. That is, they should have as little effect on individuals’ and firms’ behaviour as possible.

A broad-based GST is efficient because all goods and services bear the same tax rate and therefore will not change relative consumption. It is exemptions that bring about inefficiency by encouraging consumption of untaxed items and discouraging consumption of taxed items. Taxing wine more lightly than beer encourages wine consumption at the expense of beer.

The Australian Treasury has named company tax and income tax as having the “biggest deadweight loss” of all the Commonwealth taxes. International research backs this up. The deadweight loss falls on consumers and shareholders but mostly on workers and wages through lower investment.

The Treasury estimates the deadweight loss of company tax could be more than half the revenue raised from taxation. For income taxes, the deadweight loss is estimated to be 21 cents for every dollar of revenue. This comes about from reduced incentives to work, save or invest.

The ConversationThe PBO report suggests that with continuing trends in taxation revenue the budget’s reliance on personal income tax will increase if current levels of Commonwealth taxation are maintained as a percentage of GDP. While proposals to reduce company tax rates will reduce inefficiency of taxes somewhat, a heavy and increasing reliance on personal income tax points to the need for substantial tax reform. But that’s something neither major party seems prepared to do.

Phil Lewis, Professor of Economics, University of Canberra

This article was originally published on The Conversation. Read the original article.

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Who gets what? Who pays for it? How incomes, taxes and benefits work out for Australians



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Public health spending is an important factor in reducing inequality between households in Australia.
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Peter Whiteford, Crawford School of Public Policy, Australian National University

The Australian Bureau of Statistics has just released its latest analysis of the effects of government benefits and taxes on household income. Overall, it shows government spending and taxes reduce income inequality by more than 40% in Australia. Disparities between the richest and poorest states are also greatly reduced.

The ABS analysis provides the most up-to-date (to 2015-16) and comprehensive figures on the impacts of government spending and taxes on income distribution. As well as direct taxes and social security benefits, it estimates the impact of “social transfers in kind” – goods and services that the government provides free or subsidises. These include government spending on education, health, housing, welfare services, and electricity concessions and rebates.

The figures also include a wide range of indirect taxes. Among these are GST, stamp duties and excises on alcohol, tobacco, fuel and gambling.

The 2015-16 results are the seventh in a series published every five to six years since 1984. The methodology is based on similar studies by the UK Office of National Statistics since the 1960s. The latest UK analysis coincidentally also came out on Wednesday.

How do the calculations work?

The ABS analyses income distribution in a number of stages.

First, it calculates the distribution of “private income”. This includes wages and salaries, self-employment, superannuation, interest, dividends and income from rental properties, among other items. It also includes net imputed rent from owner-occupied dwellings and subsidised private rentals.

Next the ABS adds social security benefits, such as the Age Pension, unemployment and family payments, to give “gross income”.

Then it deducts direct taxes – primarily income tax – to give “disposable income”.

The next stage is to add the estimated value households derive from government services. This is mainly the value of public health care and education spending.

The final stage is to deduct the estimated value of indirect taxes.

So what are the impacts on income inequality?

It is possible to calculate measures of economic inequality at different stages in this process. By implication, the difference between inequality measures is the result of the different government policies taken into account.

Figure 1 shows the Gini coefficient, which ranges between zero – where all households have exactly the same income – and 100% – where one household has all of the income. The Gini coefficient for private income in 2015-16 was 44.2. The addition of social security benefits, which mainly increase the incomes of low-income groups, reduces the coefficient by 8.1 percentage points.

Deducting income taxes – which are progressive – further reduces inequality by 4.5 points. Government non-cash benefits reduce the Gini coefficient by nearly as much as the social security system. However, indirect taxes slightly increase income inequality.

The Gini coefficient for final income is 24.9. So, compared to a coefficient of 44.2 for private income, government spending and taxes reduce overall income inequality by more than 40%.

Figure 1: Effects of government spending and taxes on income inequality, measured by Gini coefficient Australia 2015-16.
Data source: ABS Government Benefits, Taxes and Household Income, Australia, 2015-16, Author provided

While most of the reduction in inequality is due to government spending, taxes are obviously important to pay for this spending.

The social security system reduces income inequality (and poverty) because Australia targets benefits to the poor more than in any other high-income country.

Figure 2 shows the distribution of social security benefits and government services across income groups, from the poorest 20% to the richest 20% of households. The poorest 20% receive about seven times as much in benefits as the richest 20%. The average for OECD countries is close to one, with rich and poor receiving about the same amount.

Figure 2: Distribution of social spending ($ per week) by equivalised disposable household income quintiles, Australia 2015-16.
Data source: ABS Government Benefits, Taxes and Household Income, Australia, 2015-16, Author provided

Government spending on social services is also progressively distributed. This spending is considerably greater than social security spending and includes both Commonwealth and state spending on education and health.

The poorest 20% receive about 70% more in non-cash benefits than do the richest. This is not due to income-testing. Instead, it’s largely a result of the greater value of public health spending on hospitals and Medicare for older people, who tend to be in the bottom half of the income distribution.

Taxes, of course, work to reduce income inequality, as high-income groups pay a higher share than low-income groups. Figure 3 shows that the poorest 20% pay about 5% of their disposable income in direct taxes, while the richest 20% pay about 30% of their disposable income.

In contrast, indirect taxes – particularly those on tobacco and gambling – are regressive. Low-income groups pay more than high-income groups as a share of their disposable income. However, the undesirable effects of smoking and gambling on the wellbeing of low-income households need to be borne in mind.

When direct and indirect taxes are added together the overall tax system is less progressive, but the richest 20% still pay nearly twice as much of their disposable income as do the poorest 20%.

Figure 3: Distribution of direct and indirect taxes (% of disposable income) by equivalised disposable household income quintiles, Australia 2015-16.
Data source: ABS Government Benefits, Taxes and Household Income, Australia, 2015-16, Author provided

Redistribution also happens between age groups and states

In addition to reducing inequalities between income groups, government spending and taxes redistribute across age groups. Government spending is much higher for households of Age Pension age than for younger households. This is because of both the Age Pension and older households’ use of the healthcare system.

For example, households where the reference person is 75 or older receive on average just over $1,000 a week in government spending but pay about $180 a week in direct and indirect taxes. Households with a person aged 45 to 54 pay the highest taxes on average – about $800 per week – and on average receive about $620 a week in social spending.

There is also redistribution across states and territories. For example, average private income is about 65% higher in Western Australia than in Tasmania. However, on average, Western Australian households receive about two-thirds of the social security benefits that Tasmanian households get. This reduces the disparity in gross income to about 45%.

Western Australian households pay about twice as much in income taxes as Tasmanians, reducing the disparity to 35%. Households in the West receive only about 3% more in spending on social services than in Tasmania, which reduces the disparity in average incomes to 28%. West Australian households also pay about 20% more in indirect taxes than Tasmanian households (although as a percentage of disposable income, this is a higher share in Tasmania).

These figures suggest that while the financing of fairly equal social services across most parts of Australia reduces inequality between states, the income tax and social security systems also significantly reduce disparities. This is because income tax and social security are national systems and because Tasmania is the poorest state largely due to the higher share of age pensioners in its population.

The ConversationOverall, this publication provides an invaluable picture of how government spending and taxes affect household economic well-being. Its results are relevant not only to the political debate about tax cuts, but also to long-term policy development to prepare Australia for an ageing population.

Peter Whiteford, Professor, Crawford School of Public Policy, Australian National University

This article was originally published on The Conversation. Read the original article.

Greens urge Buffett rule to get more tax from high income earners


Michelle Grattan, University of Canberra

The Greens tax policy, released on Wednesday, would hit high income earners and target corporate tax avoidance.

The Greens plan would bring in “a Buffett rule” to ensure higher income earners paid their fair share of tax by limiting deductions made by those earning more than A$300,000.

“This will force high income earners to pay a minimum rate of tax and stop those on high incomes from deducting their taxable income to zero,” the policy says. The move would raise $9.5 billion over the forward estimates.

A Buffett rule – that would put a floor under the tax the very wealthy had to pay – has support within the left of Labor but is not ALP policy. It has been opposed by opposition leader Bill Shorten and shadow treasurer Chris Bowen but may be raised by the left at the July ALP national conference.

In the Greens policy, another $14.3 billion would come from targeting property investors, with the capital gains tax discount phased out over five years, and negative gearing scrapped for future purchases and phased out for multiple properties.

Trusts would be taxed as large corporations, at a 30% rate, raising $3.8 billion over the forward estimates.

The policy says: “Despite what the Liberals say, Australia is a low taxing nation. It is the 8th lowest-taxed among the 35 OECD nations. Australia’s combined tax-to-GDP ratio is 28.2% for all levels of government in 2015. The OECD average is 34%.

“If Australia collected the same amount of tax as the average OECD nation then we would need to collect an additional $94 billion per year”.

Greens leader Richard Di Natale said that Australia had a “tax avoidance system” rather than a “tax system”.

“Big corporations and the super-rich have rigged the rules for themselves, and the old parties are too frightened to do anything about it.

“Big corporate donations, vested interests and the revolving door between parliament and big business has made it so that the wealthier corporations and individuals get richer and richer, while inequality just gets worse”.

The Greens oppose the corporate tax cuts and advocate changes to the petroleum resource rent tax, ending fossil fuel subsidies, mainly paid to multinational mining companies, and the introduction of a mining super profits tax at a rate of 40%.

The ConversationThey put forward measures to target corporate tax avoidance, saying it is estimated corporations avoid about $8 billion of tax a year.

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Income inequality ticks down as the rich see their incomes fall: ABS



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A decline in incomes for the top 20% has caused inequality to fall slightly.
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Peter Whiteford, Australian National University

Income inequality has dropped slightly in Australia, largely driven by a fall in incomes for the richest 20% of the population, according to the latest Australian Bureau of Statistics (ABS) Survey of Household Income and Wealth.

The richest 20% of the population have seen their real disposable incomes (adjusted for the number of people living in the household) fall by nearly 5%, or close to A$100 per week. Most other households have seen no real increase in their incomes over the two years since the previous survey was released.

Our recent public debate over whether inequality is rising or falling ran into the problem that the two most important sources of data were showing different trends. The ABS survey continues to show a higher level of income inequality than the HILDA survey, but the latest trends now look more similar.

Possibly the best characterisation of the latest ABS figures is that they show inequality remains higher than at any period before 2007-08, but in the short term it is unclear what to expect.


Read more: Here’s why it’s so hard to say whether inequality is going up or down


As you can see in the following chart, there has been a slight fall in income inequality between 2013-14 and 2015-16, with the Gini coefficient for “Equivalised Disposable Household Income” falling from 0.333 to 0.323. The Gini coefficient is a measure between zero (where all households have the same income) and one (where only one household claims all the income).

Equivalised Disposable Household Income is the total income of the household from all sources including social security payments, minus direct taxes, and then adjusted for the number of people living in the household. For example, a household of a couple with two children under the age of 15 is assumed to need 2.1 times the income of a household of a single adult to achieve the same standard of living.

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So what explains these most recent trends? At this stage, it’s difficult to be definitive. It should also be borne in mind that it has only been two years since the last survey, the overall change is not large, and so we should be cautious in unpacking the trends.

But it is worth noting that this small reduction in income inequality has come at the same time as a small fall in both median and mean disposable incomes for Australian households.

The average taxes paid by households have also risen slightly in real terms (adjusted for inflation) since 2013-14, while the average social security benefits have stayed the same in real terms. This masks a significant drop in the real level of family payments (such as the family tax benefit) received by households, and increases in age pensions and “other payments” (overseas pensions and benefits, partner allowance, sickness allowance, special benefit, war widow pension (DVA), widow allowance, and wife pensions etc.).

However, where there does appear to be large changes are in the sources of income for households. If we compare incomes between the 2013-14 and 2015-16 surveys, we find that the only group that has enjoyed real increases in incomes are those whose main source of income is social security benefits. But these have risen by only A$6 per week, or about 1.3%, and they remain by far the lowest income households in Australia, with their average incomes remaining less than half of all other household groups.

Households who mainly rely on wages and salaries have seen their average real disposable incomes fall by about A$17 per week, or about 1.4%.

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The biggest declines are among those who mainly rely on self-employment income from unincorporated businesses – usually a small business which has not incorporated as a registered company – and people whose main source of income is “other”.

“Other” includes many things, such as income received as a result of ownership of financial assets (interest, dividends), and of non-financial assets (rent, royalties), as well as from sources such as incorporated business income (i.e. companies), superannuation, child support, workers’ compensation and scholarships.

This group is fairly small – about 8% of households, but they are both the group with the highest and most unequal incomes and by far the highest level of net worth (assets minus liabilities). Their average incomes have fallen by around A$93 a week in real terms, or around 8%, but their median real incomes rose by around A$11 per week, suggesting that the loss in income was concentrated among higher income households in this group.

This group in 2013-14 had by far the highest level of income inequality with a Gini coefficient of 0.474. This has fallen to 0.423 in 2015-16. But because a lot of this income comes from the stockmarket, we can expect it to be more volatile.

The group who appear to have lost by far the most, however, are households whose main source of income is unincorporated business income. This is an even smaller group – around 4.6% of all households in 2015-16. Their real average incomes have fallen by more than A$160 per week, or around 16%. They also have a high level of inequality within their group, with a Gini coefficient of 0.353 in 2015-16, down from 0.389 two years previously.

But the overall change in income inequality is not large, and it does not significantly change Australia’s international ranking.

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Writing in the Australian yesterday, Nick Cater of the Menzies Research Centre asserted that Australia is “one of the most equal and socially mobile nations on earth”. But even with the slight reduction in inequality, we are slightly above the OECD average, and there are around 20 OECD countries who are likely to have lower levels of income inequality than Australia.

Overall, the data shows a relatively small change in incomes for employee households and for households whose main source of income is social security payments. Together, these account for 87% of all households in Australia.

The reduction in overall income inequality in this period is therefore explained by the falls in income for the self-employed and for the “other” group – the group with the highest incomes and wealth.

The ConversationUnderstanding what exactly has been happening for these groups and why will require further time and analysis. The volatility of the income sources for these groups is another reason to be cautious about projecting future trends.

Peter Whiteford, Professor, Crawford School of Public Policy, Australian National University

This article was originally published on The Conversation. Read the original article.

What income inequality looks like across Australia


Nicholas Biddle, Australian National University and Francis Markham, Australian National University

With affordable houses increasingly out of reach, wage growth slow and household debt high, Australians are certainly feeling poor. But how do they compare to their neighbours? New Census data confirms there’s a lot of variability in income.

The Census breaks the country up into 349 geographic regions (named in quote marks below), some of which cover more than one major town and some of which group related suburbs within cities. We examined 331 of these regions, excluding those containing fewer than 1,000 households.

The data show there are high levels of income inequality within these regions. A simple way to measure this is to look at the ratio of income between those who are well off (the top 20% within a region) and of those who are relatively disadvantaged (the bottom 20%) in the Census data. In Australia the weekly household income for the top 20% (A$1,579 per week) is 3.5 times the income of the bottom 20% (A$457).


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The “Melbourne City” region has the most unequal incomes in Australia, where the top 20% have an income that is 8.3 times as high as those in the bottom 20%. “Adelaide City” (ratio of 5.5) and the “Sydney Inner City” (4.8) also have quite high levels of inequality.

Two of the poorest regions in the Northern Territory also have very high inequality. These are the vast region that encircles Darwin, called “Daly, Tiwi, West Arnhem” (ratio of 5.2) and the “East Arnhem” region (5.3).

However, there are regions with varying income levels, that also had relatively low inequality ratios. The region of “Molonglo”, in South Canberra (ratio of 2.2), “West Pilbara” in Western Australia (2.4) and “Kempsey, Nambucca” on New South Wales’ north coast (2.5) all have low levels of inequality.

For our analysis, we used equivalised household income. Equivalisation is a technique in which members of a household receive different weightings, based on the amount of additional resources they need.

The Australian Bureau of Statistics assumes that the first adult in a household has a weighting of 1, each additional adult a weighting of 0.5, and each child a weighting of 0.3. Total household income is then divided by the sum of the weightings for a representative income.

Incomes across Australia

For the whole of Australia, the equivalised median household income (the income in the middle of the distribution) is A$878 per week. The region with the lowest median income was “Daly, Tiwi, West Arnhem” in the Northern Territory, at A$510 per week.


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However, several regional areas like “Maryborough, Pyrenees” (northwest of Ballarat in Victoria), “Kempsey, Nambucca” (NSW), “Maryborough” (between Bundaberg and the Sunshine Coast in Queensland), “Inverell, Tenterfield” (in NSW’s Northern Tablelands) and “South East Coast” in Tasmania all had median incomes of A$575 per week or less.

At the other end of the distribution, households in leafy suburbs of North Sydney – “Mosman” (NSW) had a median income of A$1,767 per week. Areas like “South Canberra” (ACT), “Manly” (in Sydney’s east) and the mining-dominated “West Pilbara” (WA) all had median incomes of A$1,674 or more per week.

We also looked at the extremes of the distribution. We define high income as those households with an income of A$1,500 or more per week. This equates to about 22% of the population. We defined low-income households as having an income of less than A$400 per week (about 14% of households).

Around 40% of households in the “Daly, Tiwi, West Arnhem” region were classified as being in poverty compared to around 6% in “North Sydney, Mosman” region. Conversely, around 60% of households in this region were classified as having high income, compared with only 6% of households in “Kempsey, Nambucca”.

How segregated are we within regions and cities?

While government policy is often delivered at the regional level, people live their lives at the local or neighbourhood level. However, the relatively disadvantaged and the upper-middle class are often segregated within these regions.

Richard Reeves of the Brookings Institute argues the segregation of the upper-middle class in Australia means this group “hoards” the benefits in the region they live in. Among the location advantages he lists are: access to the best schools, opportunities to network with the wealthy and powerful and the ability to disproportionately accrue capital gains on housing assets. To avoid this kind of “opportunity hoarding”, the rich and poor would need to be evenly spread within a region.

A simple way to look at this is through a “dissimilarity index”. In essence, this measures the evenness with which two groups are spread across a larger area. It ranges from zero to one, with higher values indicating a more uneven distribution and zero indicating complete mixing.

Looking at the distribution of the high income. Across Australia, the dissimilarity index has a value of 0.27. This means that around 27% of high-income households would have to move neighbourhoods to make the distribution completely even.

This varies quite substantially by region. “Far North” (encompassing Cape York in QLD) has a dissimilarity index of 0.42. “Auburn” (in western suburbs of Sydney, NSW) and “Playford” (on Adelaide’s northern fringe) also have quite large values.

Our richest regions tend to have the most even distribution of the wealthy, with “North Sydney, Mosman”, “Molonglo” and “Manly” having values of 0.06 or less.

“East Arnhem” has a very high level of concentration of low income individuals by neighbourhood, with a dissimilarity index of 0.70. The next two highest regions (“Katherine” and “Alice Springs”) are also in the Northern Territory, with index values of 0.53 and 0.55 respectively.

We can also compare the measures we used, to find out how they relate to each other. The following figure shows that the richest regions tend to be those with the highest level of income inequality.

However, as inequality goes up, there tends to be a greater concentration of low income households by neighbourhood (there’s also less of a concentration of high income households).

Have and have nots

It’s true that the level of income mobility is higher in Australia than it is in the US. However, Australia also has prominent examples of economic policies that disproportionately benefit the upper-middle class, such as the capital gains tax discount and superannuation tax incentives.

Australia also has a geographically concentrated income distribution, with the rich living in neighbourhoods with other rich people. The poor are also more likely to live in close proximity to people who share their disadvantage.

If Richard Reeves is right, and the spatial segregation of high and low income households reinforces inequality across the generations, then policies that encourage the mixing of different social classes in the same neighbourhood and region should be a way forward.


The ConversationThis article was put together with research assistance from Hubert Wu, Australian National University and Harvard University.

Nicholas Biddle, Associate Professor, ANU College of Arts and Social Sciences, Australian National University and Francis Markham, Research Fellow, College of Arts and Social Sciences, Australian National University

This article was originally published on The Conversation. Read the original article.

Income inequality exists in Australia, but the true picture may not be as bad as you thought



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Wealth inequality remains a problem in Australia, but it is lower now than in the years leading up to the GFC.
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Roger Wilkins, University of Melbourne

We hear a lot about inequality in Australia but the true picture is much more complicated than the headlines usually suggest.

The data indicate that wealth inequality has grown but is lower now than before the global financial crisis (GFC). And while the personal incomes of the very rich have gone up, overall household income inequality has barely shifted since the start of this century.

Economic inequality refers to the extent to which material well-being differs across people – how rich are the rich, how poor are the poor. But there are different ways to be rich, and different ways to be poor.

Income inequality is about the gap between people with high incomes and low incomes. Wealth inequality, on the other hand, looks at the gap between people with high net worth (for example, a lot of houses, stocks or other assets) and people with low net worth (few or no assets). People could have very similar incomes but be at opposite ends of the scale when it comes to their wealth, for example.

In practice, attention typically focuses on income inequality, although it is also important to consider wealth inequality.

Since 2000-01, there have been three key data sources for examining income inequality in Australia: the Australian Bureau of Statistics’ (ABS) Household Income and Wealth surveys, the Household, Income and Labour Dynamics in Australia (HILDA) Survey that the Melbourne Institute has been running since 2001, and the Australian Taxation Office’s tax records data.

The first two can also be used to examine wealth inequality.

For various reasons, the three data sets do not tell exactly the same story about income inequality trends since the beginning of this century. Nonetheless, there are some key conclusions we can draw.

1. The top 1% got richer, faster – but overall household income inequality has barely changed

The first conclusion is that the personal incomes of the very rich have grown somewhat more strongly than the personal incomes of the rest of the population.

For example, data compiled by the World Wealth and Income Database (WID World) show that the share of income going to the top 1% rose from 7.5% in 2000-01 to 9% in 2013-14.


WID World

Despite this increase in inequality of personal incomes at the top, measures of overall inequality of household incomes (as opposed to personal incomes) show relatively little net change this century.

One way to track this is to look at the Gini co-efficient, a commonly used measure of inequality that ranges from zero to one. Zero means total equality, with everyone on the same income. A Gini coefficient of one means complete inequality, the equivalent of one person having all the income.

HILDA survey data show that Australia’s Gini coefficient was 0.303 in 2000-01 and 0.296 in 2014-15. In other words, it has barely shifted.

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The ABS income survey shows a small increase from 0.311 in 2000-01 to 0.333 in 2013-14, but this increase can be attributed to changes made by the ABS between 2003-04 and 2007-08 to the definition and measurement of income:

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Being a longitudinal study, the HILDA Survey also allows us to consider inequality in incomes measured over longer intervals than one year. Incomes can fluctuate from year to year, and so we may get an exaggerated picture of income inequality if we examine only annual income. Some people who appear poor in one year may in fact have high incomes in other years and so, overall, are not really poor.

The HILDA Survey indeed shows that inequality of income measured over five years is lower than inequality of annual income. However, of some concern is that measures of inequality of five-year income have been trending upwards since the early 2000s — although the increase is very slight.

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2. Wage inequality has increased

While that’s been happening, however, the labour market has become more unequal.

Wage inequality is typically thought of in terms of inequality in earnings per hour worked, while labour market inequality more broadly could be thought of as inequality in total (annual) earnings across all persons in the labour force.

Wage inequality has steadily risen and, moreover, the share of employment that is part-time has risen. Research published last year showed that the higher your pay relative to others, the more likely you are to get a better pay rise.

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On the surface, it is remarkable that the large rise in labour market inequality has not — at least, not yet — translated to large increases in income inequality.

The reasons for this are complex, but an important contributor has been the relative concentration of employment growth in low-income households.

Another potential reason why increased wage inequality has not translated to increases in income inequality is our system of progressive income taxes and transfers. However, this seems largely to not be the case in the 2000s in Australia, since the tax and transfer system actually became less redistributive (was doing less to reduce income inequality) over this period.

So while the tax and transfer system has probably moderated the effects of increased wage inequality on income inequality, it has not completely neutralised it.

3. Wealth inequality grew – but is lower now than in the years leading up to the GFC

In terms of wealth, both the ABS income surveys and the HILDA Survey indicate that wealth inequality grew strongly in the years leading up to the global financial crisis (GFC).

The HILDA Survey, which has collected detailed wealth data every four years since 2002, shows that the wealth required to be in the top 1% of the wealth distribution increased by 140% in real terms between 2002 and 2006. This was a period in which both house prices and the share market were rising strongly.

However, wealth inequality appears to have moderated slightly since the GFC, with the wealth required to be in the top 1% actually 9% lower in 2014 than in 2006. This appears to primarily derive from weaker share market performance. The ASX200, for example, was approximately 20% below its October 2007 peak in late 2014 (and even now is still over 10% below the peak).

Perception and reality

In light of the minimal changes in overall income inequality this century, and the evidence that wealth inequality is lower now than in the years leading up to the GFC, it is perhaps surprising that public perceptions appear to be that inequality is growing strongly.

Income inequality has grown in the US more sharply than it has in Australia.
World Wealth and Income Database WID World

Perhaps also important is that household income growth in Australia has slowed since 2008-09, and indeed has essentially stalled since 2011-12. In part, this reflects slowing wage growth, but also important has been relatively weak growth in employment, and in particular full-time employment.

For example, the forthcoming HILDA Survey Statistical Report will show that, at December 2015 prices, the median “equivalised” household income – that is, household income adjusted for household size – was A$46,031 in 2011-12 and was still only A$46,007 in 2014-15.

The ConversationThis stagnation in average living standards is arguably likely to lead to greater focus on the fairness of the income distribution.

Roger Wilkins, Professorial Research Fellow and Deputy Director (Research), HILDA Survey, Melbourne Institute of Applied Economic and Social Research, University of Melbourne

This article was originally published on The Conversation. Read the original article.

Muslim Extremists Murder Christian Family in Pakistan


Lawyer, wife, five children shot to death after he tried to defend Christian.

ISLAMABAD, Pakistan, September 30 (CDN) — Islamic extremists killed a Christian lawyer, his wife and their five children in northwestern Pakistan this week for mounting a legal challenge against a Muslim who was charging a Christian exorbitant interest, local sources said.

Police found the bodies of attorney and evangelist Edwin Paul and his family on Tuesday morning (Sept. 28) at their home in Haripur, a small town near Abbotabad in Khyber Pakhtunkhwa Province (previously known as the North-West Frontier Province, or NWFP), according to Haripur Station House Officer (SHO) Maqbool Khan.

The victim and his wife Ruby Paul, along with their five children ages 6 to 17, had been shot to death.

“On Sept. 28 at around 8 a.m., we received a call from Sher Khan colony that people heard gunshots, and there was a group of people who ran from a house and drove away,” Khan said. “We went and found seven bodies in a house.”

Paul’s Muslim neighbor, Mushtaq Khan, told Compass that the previous day a group of armed men had threatened the lawyer.

“On Monday a group of armed men stopped Paul and took him by the collar and said, ‘Leave the town in 24 hours – we know how to throw out Christians, we will not allow even a single Christian to live here. We will hang them all in the streets, so that no Christian would ever dare to enter the Hazara land.”

The Hazara are settlers from northern Pakistan who are an ethnic mixture of Punjabi Jats and Pashtuns (also called Pathans). Drawing attention for demanding a separate province for themselves when the NWFP became Khyber Pakhtunkhwa, the Hazara community financially supports area Islamic extremist groups and is known for charging up to 400 percent interest to Christians. Paul had moved with his family to the area in February.

He had taken up the case of Robin Mehboob, a Christian taxi driver in Haripur who had received a loan of 150,000 rupees (US$1,725) from Noor Khan, an influential Muslim whose lending network extends to some parts of Punjab Province, to buy a taxi. Originally Noor Khan agreed that Mehboob would pay back 224,000 rupees (US$2,580) after one year, Mehboob said.

“I gave my property papers as a guarantee,” Mehboob told Compass, “but then the amount of the interest was raised to 500 percent because I am a Christian – he was demanding back 1.12 million rupees [US$12,893]. They have forcefully taken over my property and have confiscated my taxi as well. I am a poor man, the taxi is the only source of income.”

Paul took Mehboob and the documents of the original loan agreement to the Haripur police station, Mehboob said.

“We talked to the SHO, who said, ‘You can file a complaint, but I can assure you that no one will testify against Noor Khan, as he is supported by extremist groups,’” Mehboob said. “We filed the complaint, and one of the police officers informed [Noor] Khan that we went to the police station.”

On their way back from the police station, three cars filled with Noor Khan’s associates stopped near his house, Mehboob said.

“They came out and said, ‘How dare you Christians go to the police, don’t you know we own the law here?’ They assaulted us, beating us with fists and clubs, and warned that if we try to seek any assistance, they will kill us.”

Mehboob left Haripur that night and went to his brother in Sialkot.

Paul wrote to the Khyber Pakhtunkhwa government, Christian organizations and churches for help, explaining how Noor Khan and the extremist groups were driving Christians out of the area by taking over their property or threatening to kill them unless they sold their homes.

The Muslim extremist groups most active in the area are the banned Jamat ul Dawa, the Sunni Tahreek, and some groups linked with the Pakistani Taliban. The extremist groups were making fake documents to occupy properties owned by Christians, and Hazara investors were supporting the campaign, area Christians said.

The Muslim extremists have also threatened many Christians with death if they do not convert, they said.

Pastor Rehmat Naeem of St. Paul Church in Haripur told Compass that he had also received threats.

“Some extremists sent us threats through phone calls and letters, asking us to leave Haripur,” Pastor Naeem said. “Many Christians were forced to sell their property at very low rates and leave the area. Edwin Paul tried to help the Christians – he even talked to the higher authorities, but no one was ready to testify against the extremists.”

Pastor Naeem added that two months ago area extremists kidnapped eight missionaries; six have been released, and the two others are presumed dead.

A First Information Report has been filed in the murder of Paul and his family, and the District Coordination Officer and District Police Officer (DPO) have strongly condemned the crime and instructed the SHO to find those responsible, authorities said.

Chief Secretary of Hazara Division Ali Ahmed has released a statement ordering a police operation “under the Terrorist Act against the extremists and the Hazaras for forcefully driving away the Christians and killing seven innocent people. We will not allow anyone to threaten the religious minorities. It is the duty of the state to protect the life and property of its people. The DPO has been instructed to arrest the culprits in 72 hours and submit a report or he will be suspended.”

Report from Compass Direct News

Vietnam stepping up religious rights abuses, experts say


Government-perpetrated violence against a Catholic village in Vietnam has highlighted a series of human rights abuses in the communist nation, and three U.S. congressmen are calling on the United Nations to intervene, reports Baptist Press.

"A few months ago during a religious funeral procession, Vietnamese authorities and riot police disrupted that sad and solemn occasion, shooting tear gas and rubber bullets into the crowd, beating mourners with batons and electric rods," Rep. Chris Smith, R.-N.J., said at a hearing of the Tom Lantos Human Rights Commission in August.

"More than 100 were injured, dozens were arrested and several remain in custody and have reportedly been severely beaten and tortured. At least two innocent people have been murdered by the Vietnamese police," Smith said.

The Con Dau tragedy, Smith said, "is unfortunately not an isolated incident." Property disputes between the government and the Catholic church continue to lead to harassment, property destruction and violence, Smith said, referring to a report by the U.S. Commission on International Religious Freedom.

"In recent years, the Vietnamese government has stepped up its persecution of Catholic believers, bulldozing churches, dismantling crucifixes and wreaking havoc on peaceful prayer vigils," Smith said.

Persecution is not limited to Catholics, though, as Smith had a list of nearly 300 Montagnard political and religious prisoners. In January, the Vietnamese government sentenced two Montagnard Christians to 9 and 12 years imprisonment for organizing a house church, and others have been arrested in connection with house churches, Smith said.

"The arrests were accompanied by beatings and torture by electroshock devices," the congressman said. "We must not forget the sufferings of Khmer Krom Buddhists, Cao Dai, Hoa Hao, the Unified Buddhist Church of Vietnam and others. The said reality is that the Vietnamese government persecutes any religious group that does not submit to government control."

The violence in the 80-year-old Catholic village of Con Dau in central Vietnam reportedly stemmed from a government directive for residents to abandon the village to make way for the construction of a resort.

International Christian Concern, a Washington-based watchdog group, reported that when Con Dau residents refused to leave, water irrigation was shut off to their rice fields, stopping the main source of income and food.

In May, police attacked the funeral procession, beating more than 60 people, including a pregnant woman who was struck in the stomach until she had a miscarriage, ICC said.

One of the funeral procession leaders later was confronted by police in his home, where they beat him for about four hours and then released him. He died the next day, ICC said. Eight people remain in police custody and are awaiting trial.

"The people of Con Dau are living in desperate fear and confusion," Thang Nguyen, executive director of an organization representing Con Dau victims, told ICC. "Hundreds of residents have been fined, and many have escaped to Thailand."

Smith, along with Rep. Joseph Cao, R.-La., and Frank Wolf, R.-Va., introduced a House resolution in July calling for the United Nations to appoint a special investigator to probe "ongoing and serious human rights violations in Vietnam." In August, the Lantos Commission met in emergency session to address the "brutal murders and systematic treatment of Catholics in Con Dau."

"The Vietnamese government justifies this violence, torture and murder because the villagers of Con Dau had previously been ordered, some through coercion, to leave their village, property, church, century-old cemetery, their religious heritage, and to forgo equitable compensation in order to make way for a new ‘green’ resort," Smith said at the hearing. "Nothing, however, not even governmental orders, grant license for government-sanctioned murder and other human rights abuses."

The U.S. Department of State declined to testify before the Lantos Commission, and the U.S. ambassador to Vietnam characterized the Con Dau incident as a land dispute and refused to get involved.

Logan Maurer, a spokesman for International Christian Concern, told Baptist Press he has publicized about 10 different incidents of persecution in Vietnam during the past few months.

"In some cases, especially in Southeast Asia, religious persecution becomes a gray area. We also work extensively in Burma, where often there are mixed motives for why a particular village is attacked," Maurer said. "Is it because they’re Christian? Well, partially. Is it because they’re an ethnic minority? Partially.

"So I think the same thing happens in Vietnam where you have a whole village that’s Catholic. One hundred percent of it was Catholic," he said of Con Dau.

Maurer explained that local government officials in Vietnam generally align Christianity with the western world and democracy, which is still seen as an enemy in Vietnam on a local level.

"As far as the official government Vietnamese position, that’s different, but local government officials do not take kindly to Christians and never have. We have documented many cases of government officials saying Christianity is the enemy. So here it’s mixed motives as best we can figure out," Maurer said.

"They wanted to build a resort there, and they could have picked a different village but they chose the one on purpose that was Catholic because it represents multiple minorities — minority religion, minority also in terms of people that can’t fight back. If they go seek government help, the government is not going to help them."

A Christian volunteer who has visited Vietnam five times in the past decade told Baptist Press the Con Dau incident illustrates the way the Vietnamese government responds to any kind of dissent.

"In our country, and in modern democracies, there are methods for resolving disputes with the government, taking them to court, trying to work through the mediation process," the volunteer, who did not want to be identified, said. "In Vietnam there is no such thing. It is the government’s will or there will be violence."

Vietnam’s constitution includes a provision for religious liberty, but the volunteer said that only goes as far as the communal will of the people, which is monopolized by the Communist Party.

"So when the Communist Party says you can’t build a church there or you can’t worship this way, those who say, ‘Well, I have religious freedom,’ are essentially trumped by the constitution that says it’s the will of the people, not individual liberty that’s important," the volunteer said.

The government in Vietnam has made efforts during the past 15 years to open up the country to economic development, and with that has come an influx of some western values and a lot of Christians doing work there, the volunteer said.

"I would first caution Christians to still be careful when they’re there working," he said, adding that government officials closely watch Christians who visit from other countries, and books about Jesus cause trouble.

Secondly, the volunteer warned that all news emerging from Vietnam must be tested for accuracy on both sides because both those who are persecuting and those who are sounding the alarm on persecution have their own political goals.

"That being said, I don’t doubt that this happened," the volunteer said regarding Con Dau.

International Christian Concern urges Americans to contact the Vietnamese Embassy in Washington at 202-861-0737, and the Christian volunteer said people can contact the U.S. Commission on International Religious Freedom to encourage changes in Vietnam.

"They can also directly e-mail the ambassador and the consular general in Ho Chi Minh City and encourage them to push for more reform," he said. "And they can contact companies that are having products made in Vietnam and encourage the business leaders to speak out for change in those countries. You go to JC Penney today in the men’s department and pick up almost anything, it’s made in Vietnam. That’s the kind of pressure they could put on them."

Report from the Christian Telegraph

Egyptian Couple Shot by Muslim Extremists Undaunted in Ministry


Left for dead, Christians offer to drop charges if allowed to construct church building.

CAIRO, Egypt, June 9 (CDN) — Rasha Samir was sure her husband, Ephraim Shehata, was dead.

He was covered with blood, had two bullets inside him and was lying facedown in the dust of a dirt road. Samir was lying on top of him doing her best to shelter him from the onslaught of approaching gunmen.

With arms outstretched, the men surrounded Samir and Shehata and pumped off round after round at the couple. Seconds before, Samir could hear her husband mumbling Bible verses. But one bullet had pierced his neck, and now he wasn’t moving. In a blind terror, Samir tried desperately to stop her panicked breathing and convincingly lie still, hoping the gunmen would go away.

Finally, the gunfire stopped and one of the men spoke. “Let’s go. They’re dead.”

 

‘Break the Hearts’

On the afternoon of Feb. 27, lay pastor Shehata and his wife Samir were ambushed on a desolate street by a group of Islamic gunmen outside the village of Teleda in Upper Egypt.

The attack was meant to “break the hearts of the Christians” in the area, Samir said.

The attackers shot Shehata twice, once in the stomach through the back, and once in the neck. They shot Samir in the arm. Both survived the attack, but Shehata is still in the midst of a difficult recovery. The shooters have since been arrested and are in jail awaiting trial. A trial cannot begin until Shehata has recovered enough to attend court proceedings.

Despite this trauma, being left with debilitating injuries, more than 85,000 Egyptian pounds (US$14,855) in medical bills and possible long-term unemployment, Shehata is willing to drop all criminal charges against his attackers – and avoid what could be a very embarrassing trial for the nation – if the government will stop blocking Shehata from constructing a church building.

Before Shehata was shot, one of the attackers pushed him off his motorcycle and told him he was going to teach him a lesson about “running around” or being an active Christian.

Because of his ministry, the 34-year-old Shehata, a Coptic Orthodox Christian, was arguably the most visible Christian in his community. When he wasn’t working as a lab technician or attending legal classes at a local college, he was going door-to-door among Christians to encourage them in any way he could. He also ran a community center and medical clinic out of a converted two-bedroom apartment. His main goal, he said, was to “help Christians be strong in their faith.”

The center, open now for five years, provided much-needed basic medical services for surrounding residents for free, irrespective of their religion. The center also provided sewing training and a worksite for Christian women so they could gain extra income. Before the center was open in its present location, he ran similar services out of a relative’s apartment.

“We teach them something that can help them with the future, and when they get married they can have some way to work and it will help them get money for their families,” Shehata said.

Additionally, the center was used to teach hygiene and sanitation basics to area residents, a vital service to a community that uses well water that is often polluted or full of diseases. Along with these services, Shehata and his wife ran several development projects, repairing the roofs of shelters for poor people, installing plumbing, toilets and electrical systems. The center also distributed free food to the elderly and the infirm.

The center has been run by donations and nominal fees used to pay the rent for the apartment. Shehata has continued to run the programs as aggressively as he can, but he said that even before the shooting that the center was barely scraping by.

“We have no money to build or improve anything,” he said. “We have a safe, but no money to put in it.”

 

Tense Atmosphere

In the weeks before the shooting, Teleda and the surrounding villages were gripped with fear.

Christians in the community had been receiving death threats by phone after a Muslim man died during an attack on a Christian couple. On Feb. 2, a group of men in nearby Samalout tried to abduct a Coptic woman from a three-wheeled motorcycle her husband was driving. The husband, Zarif Elia, punched one of the attackers in the nose. The Muslim, Basem Abul-Eid, dropped dead on the spot.

Elia was arrested and charged with murder. An autopsy later revealed that the man died of a heart attack, but local Muslims were incensed.

Already in the spotlight for his ministry activities, Shehata heightened his profile when he warned government officials that Christians were going to be attacked, as they had been in Farshout and Nag Hammadi the previous month. He also gave an interview to a human rights activist that was posted on numerous Coptic websites. Because of this, government troops were deployed to the town, and extremists were unable to take revenge on local Christians – but only after almost the
entire Christian community was placed under house arrest.

“They chose me,” Shehata said, “Because they thought I was the one serving everybody, and I was the one who wrote the government telling them that Muslims were going to set fire to the Christian houses because of the death.”

Because of his busy schedule, Shehata and Samir, 27, were only able to spend Fridays and part of every Saturday together in a village in Samalut, where Shehata lives. Every Saturday after seeing Samir, Shehata would drive her back through Teleda to the village where she lives, close to her family. Samalut is a town approximately 105 kilometers (65 miles) south of Cairo.

On the afternoon of Feb. 27, Shehata and his wife were on a motorcycle on a desolate stretch of hard-packed dirt road. Other than a few scattered farming structures, there was nothing near the road but the Nile River on one side, and open fields dotted with palm trees on the other.

Shehata approached a torn-up section of the road and slowed down. A man walked up to the vehicle carrying a big wooden stick and forced him to stop. Shehata asked the man what was wrong, but he only pushed Shehata off the motorcycle and told him, “I’m going to stop you from running around,” Samir recounted.

Shehata asked the man to let Samir go. “Whatever you are going to do, do it to me,” he told the man.

The man didn’t listen and began hitting Shehata on the leg with the stick. As Shehata stumbled, Samir screamed for the man to leave them alone. The man lifted the stick again, clubbed Shehata once more on the leg and knocked him to the ground. As Shehata struggled to get up, the man took out a pistol, leveled it at Shehata’s back and squeezed the trigger.

Samir started praying and screaming Jesus’ name. The man turned toward her, raised the pistol once more, squeezed off another round, and shot Samir in the arm. Samir looked around and saw a few men running toward her, but her heart sank when she realized they had come not to help them but to join the assault.

Samir jumped on top of Shehata, rolled on to her back and started begging her attackers for their lives, but the men, now four in all, kept firing. Bullets were flying everywhere.

“I was scared. I thought I was going to die and that the angels were going to come and get our spirits,” Samir said. “I started praying, ‘Please God, forgive me, I’m a sinner and I am going to die.’”

Samir decided to play dead. She leaned back toward her husband, closed her eyes, went limp and tried to stop breathing. She said she felt that Shehata was dying underneath her.

“I could hear him saying some of the Scriptures, the one about the righteous thief [saying] ‘Remember me when you enter Paradise,’” she said. “Then a bullet went through his neck, and he stopped saying anything.”

Samir has no way of knowing how much time passed, but eventually the firing stopped. After she heard one of the shooters say, “Let’s go, they’re dead,” moments later she opened her eyes and the men were gone. When she lifted her head, she heard her husband moan.

 

Unlikely Survival

When Shehata arrived at the hospital, his doctors didn’t think he would survive. He had lost a tremendous amount of blood, a bullet had split his kidney in two, and the other bullet was lodged in his neck, leaving him partially paralyzed.

His heartbeat was so faint it couldn’t be detected. He was also riddled with a seemingly limitless supply of bullet fragments throughout his body.

Samir, though seriously injured, had fared much better than Shehata. The bullet went into her arm but otherwise left her uninjured. When she was shot, Samir was wearing a maternity coat. She wasn’t pregnant, but the couple had bought the coat in hopes she soon would be. Samir said she thinks the gunman who shot her thought he had hit her body, instead of just her arm.

The church leadership in Samalut was quickly informed about the shooting and summoned the best doctors they could, who quickly traveled to help Shehata and Samir. By chance, the hospital had a large supply of blood matching Shehata’s blood type because of an elective surgical procedure that was cancelled. The bullets were removed, and his kidney was repaired. The doctors however, were forced to leave many of the bullet fragments in Shehata’s body.

As difficult as it was to piece Shehata’s broken body back together, it paled in comparison with the recovery he had to suffer through. He endured multiple surgeries and was near death several times during his 70 days of hospitalization.

Early on, Shehata was struck with a massive infection. Also, because part of his internal tissue was cut off from its blood supply, it literally started to rot inside him. He began to swell and was in agony.

“I was screaming, and they brought the doctors,” Shehata said. The doctors decided to operate immediately.

When a surgeon removed one of the clamps holding Shehata’s abdomen together, the intense pressure popped off most of the other clamps. Surgeons removed some stomach tissue, part of his colon and more than a liter of infectious liquid.

Shehata could not eat normally and lost 35 kilograms (approximately 77 lbs.). He also couldn’t evacuate his bowels for at least 11 days, his wife said.

Despite the doctors’ best efforts, infections continued to rage through Shehata’s body, accompanied by alarming spikes in body temperature.

Eventually, doctors sent him to a hospital in Cairo, where he spent a week under treatment. A doctor there prescribed a different regimen of antibiotics that successfully fought the infection and returned Shehata’s body temperature to normal.

Shehata is recovering at home now, but he still has a host of medical problems. He has to take a massive amount of painkillers and is essentially bedridden. He cannot walk without assistance, is unable to move the fingers on his left hand and cannot eat solid food. In approximately two months he will undergo yet another surgery that, if all goes well, will allow him to use the bathroom normally.

“Even now I can’t walk properly, and I can’t lift my leg more than 10 or 20 centimeters. I need someone to help me just to pull up my underwear,” Shehata said. “I can move my arm, but I can’t move my fingers.”

Samir does not complain about her condition or that of Shehata. Instead, she sees the fact that she and her husband are even alive as a testament to God’s faithfulness. She said she thinks God allowed them to be struck with the bullets that injured them but pushed away the bullets that would have killed them.

“There were lots of bullets being shot, but they didn’t hit us, only three or four,” she said. “Where are the others?”

Even in the brutal process of recovery, Samir found cause for thanks. In the beginning, Shehata couldn’t move his left arm, but now he can. “Thank God and thank Jesus, it was His blessing to us,” Samir said. “We were kind of dead, now we are alive."

Still, Samir admits that sometimes her faith waivers. She is facing the possibility that Shehata might not work for some time, if ever. The couple owes the 85,000 Egyptian pounds (US$14,855) in medical bills, and continuing their ministry at the center and in the surrounding villages will be difficult at best.

“I am scared now, more so than during the shooting,” she said. “Ephraim said do not be afraid, it is supposed to make us stronger.”

So Samir prays for strength for her husband to heal and for patience. In the meantime, she said she looks forward to the day when the struggles from the shooting are over and she can look back and see how God used it to shape them.

“There is a great work the Lord is doing in our lives, we may not know what the reason is now, but maybe some day we will,” Samir said.

 

Government Opposition

For the past 10 years, Shehata has tried to erect a church building, or at a minimum a house, that he could use as a dedicated community center. But local Muslims and Egypt’s State Security Investigations (SSI) agency have blocked him every step of the way. He had, until the shooting happened, all but given up on constructing the church building.

On numerous occasions, Shehata has been stopped from holding group prayer meetings after people complained to the SSI. In one incident, a man paid by a land owner to watch a piece of property near the community center complained to the SSI that Shehata was holding prayer meetings at the facility. The SSI made Shehata sign papers stating he wouldn’t hold prayer meetings at the center.

At one time, Shehata had hoped to build a house to use as a community center on property that had been given to him for that purpose. Residents spread a rumor that he was actually erecting a church building, and police massed at the property to prevent him from doing any construction.

There is no church in the town where Shehata lives or in the surrounding villages. Shehata admits he would like to put up a church building on the donated property but says it is impossible, so he doesn’t even try.

In Egypt constructing or even repairing a church building can only be done after a complex government approval process. In effect, it makes it impossible to build a place for Christian worship. By comparison, the construction of mosques is encouraged through a system of subsidies.

“It is not allowed to build a church in Egypt,” Shehata said. “We can’t build a house. We can’t build a community center. And we can’t build a church.”

Because of this, Shehata and his wife organize transportation from surrounding villages to St. Mark’s Cathedral in Samalut for Friday services and sacraments. Because of the lack of transportation options, the congregants are forced to ride in a dozen open-top cattle cars.

“We take them not in proper cars or micro-buses, but trucks – the same trucks we use to move animals,” he said.

The trip is dangerous. A year ago a man fell out of one of the trucks onto the road and died. Shehata said bluntly that Christians are dying in Egypt because the government won’t allow them to construct church buildings.

“I feel upset about the man who died on the way going to church,” he said.

 

Church-for-Charges Swap

The shooters who attacked Shehata and Samir are in jail awaiting trial. The couple has identified each of the men, but even if they hadn’t, finding them for arrest was not a difficult task. The village the attackers came from erupted in celebration when they heard the pastor and his wife were dead.

Shehata now sees the shooting as a horrible incident that can be turned to the good of the believers he serves. He said he finds it particularly frustrating that numerous mosques have sprouted up in his community and surrounding areas during the 10 years he has been prevented from putting up a church building, or even a house. There are two mosques alone on the street of the man who died while being trucked to church services, he said.

Shehata has decided to forgo justice in pursuit of an opportunity to finally construct a church building. He has approached the SSI through church leaders, saying that if he is allowed to construct a church building, then he will take no part in the criminal prosecution of the shooters.

“I have told the security forces through the priests that I will drop the case if they can let us build the church on the piece of land,” he said.

The proposal isn’t without possibilities. His trial has the potential of being internationally embarrassing. It raises questions about fairness in Egyptian society during an upcoming presidential election that will be watched by the world.

Regardless of what happens, Shehata said all he wants is peace and for the rights of Christians to be respected. He said that in Egypt, Christians have less value than the “birds of the air” mentioned in the Bible. According to Luke 12:6, five sparrows sold for two pennies in ancient times.

“We are not to be killed like birds, slaughtered,” he said. “We are human.”

Report from Compass Direct News

Pakistani lawyer faces court for murder of Christian girl


No other year in the last decade has seen more persecution against Pakistani Christians than 2009. As many as 130 Christians were killed through attacks, arrests and detentions throughout the year, according to International Christian Concern. And so far, this year has not been much better, reports MNN.

Late in January, yet another Christian, Shazia Bashir Masih, lost her life at the hands of a Muslim.

"On January 22, a Muslim lawyer by the name of Mohammed Naeem tortured and killed a 12-year-old Christian girl in Lahore, Pakistan," said Jonathan Racho of ICC. The girl was rushed to the hospital after sustaining injuries "but did not recover and passed away," said lawyers of the Centre for Legal Aid, Assistance and Settlement (CLAAS).

Masih worked for Naeem as a servant for eight months to help her parents financially. Sources say the 1000 rupees (12 USD) she made a month was her family’s only income.

Naeem, a famous lawyer in the area, reportedly bribed local authorities to prevent his arrest. However, when the police failed to move against Naeem, Masih’s family staged protests outside of government offices.

Their protests attracted the attention of local media, and Pakistan’s president soon heard of the case. At this point, Naeem was arrested along with five other individuals related to the crime.

According to Aid to the Church in Need, Naeem appeared in court on Jan. 26, the day following Masih’s funeral. CLAAS, who is representing the Masih family, presented their case on Jan. 29. The hearing will resume on Feb. 3.

In addition to Naeem being a well-known lawyer in the area, he is also the former president of the Lahore Bar Association, which is the organization that issues licenses to the lawyers of the area. Because of this sway and other bribes Naeem has offered to the Masih family, they have had difficulty finding representation, according to ICC.

However, ICC also reported on a news conference of CLAAS and church leaders, "CLAAS is still determined to go the distance necessary to secure justice for Shazia and her family."

Whatever the outcome of the trial, Racho remained hopeful about the strength of Christians in Pakistan.

"Persecution cannot stop the Gospel from being preached and from Christians being faithful to Christ. On the one hand, there is an increase in persecution; on the other hand, Christians remain faithful to the faith, and they even continue to spread the Gospel and bring Muslims to Christ," said Racho.

Report from the Christian Telegraph