Editor's note

It’s one of the most hotly debated questions in Australian politics today, one that might still have a bearing on the next election: will a proposed 5% cut to company taxes for businesses with a turnover of more than $50 million really lead to higher wages?

In February, ABC chief economics correspondent Emma Alberici tried to answer this question and the Turnbull Government didn’t appreciate the effort. It kicked up an almighty fuss, backed by might of the Financial Review, which slammed Alberici over alleged factual errors. In response to the hoha the ABC took down Alberici’s analysis, rewrote it, and reposted it as a delightfully breezy social column: “The Prime Minister has invited a who’s who of Australian business to accompany him this week on his trip to meet President Donald Trump.”

Undeterred, last month the activist group GetUp! had a go at providing an answer, producing a graph for social media which suggested that real wages actually fell in the US following a corporate tax cut. The graph neatly reinforced the Opposition line that tax cuts for the big end of town are bad for workers. But as everyone knows, correlation doesn’t always equal causation. Today The Conversation FactChecks that GetUp! claim using our unique approach of getting an academic to review the evidence then submit their findings to blind review by a second academic.

To put it kindly, the graph supplied by GetUp! doesn’t prove that the tax cut in the US caused a decline in real wages. If you want to know why, read Fabrizio Carmignani’s terrific FactCheck. (Warning: graphic material, of the X and Y axis variety.)

Misha Ketchell

Editor

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GetUp! national director Paul Oosting. GetUp!

FactCheck: GetUp! on the impact of US corporate tax cuts on wages

Fabrizio Carmignani, Griffith University

A social media post shared by GetUp! Australia suggested US real wages had dropped significantly following the enactment of Trump's corporate tax cuts in January. We asked the experts to check it out.

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