One of the biggest jokes politics plays on itself is “secrecy” – secret internal polling that apparently makes public polling wrong, secret campaign tactics that relegate Sun Tzu to the status of mere amateur, through to other various secret and supposedly profound insights into the electorate that are beyond the comprehension of normal mortals. Cryptic [...]READ MORE
What do Australians believe about the economy? What do we believe the role is for government in our society and its economy today? Do our beliefs match our actions – or better still, are our beliefs and expectations of government even consistent from one topic to the next, let alone consistent between our broad ideals and what we actually believe when we focus on any given specific issue?
But more importantly, just how representative are those voices in our national debate that so often claim to speak on our behalf – that so often claim to represent the views we supposedly believe in as a population?
What follows is a walk through the national mindset as we have collectively revealed it to be over the last 6 months in polling. Some of you will be rejoice over what turns up, others will be horrified – all of you will probably have a chuckle at some of the paradoxes involved – yet whatever your perspective, it certainly helps explain some of the underlying dynamics of our national disgruntlement. The 30 odd poll results here mention the pollster and the date the polls were taken at the bottom and all have sample sizes about 1000 for a margin of error around the 3% mark.
First up – what do we see as the role of government? (click to expand)
Adding some texture to this and focusing on some specific policy areas (click to expand):
As a country, we believe not only in an active government, but we also believe that our governments are doing too little in providing the public services we demand. Health, public transport infrastructure, education – even holding banks and financial institutions to account (keep this in your thought orbit, as it will feed into some important themes later) – all show the public desire for more government action.
Yet this is where the first paradox occurs. What do we believe about the size of government?
Think about that for a minute. The largest response, a plurality of the population, believes that government is too large, yet clear majorities want government to do more on health, education, public transport and bank regulation – while a plurality wants the government to do more on crime protection and pollution regulation.
But let’s not stop there – if government is too large, do we believe that things like industry assistance for car manufacturing is part of the largesse problem?
Clearly not. Worth noting here is that this question didn’t ask about current levels of assistance, but *additional* assistance. Support is not only strong, but bipartisan – with only Greens voters not reaching an outright majority for more government expenditure on car manufacturing.
But is this view of ours isolated to just assistance for car manufacturing, perhaps as some peculiar cultural security blanket we’ve developed for Australian made motor vehicles?
Or course not! We support giving assistance to other manufacturing sectors at a higher rate than we do for the motor vehicle industry. What is also interesting to note is that while 55% of Coalition voters believed government is too large, 66% of them believe in what can only be described as high levels of industry support – and do so at a rate higher than ALP voters.
The “size of government” paradox in Australia is quite something – while we believe government is too large as some broad, abstract motherhood statement, we also want it to be that size or even larger whenever we focus on a specific issue. As we shall see later on, it just doesn’t stop at industry assistance or the usual list of public services, but covers a vast policy playing field.
So what then do we currently think of the economic reform program of the past 30 years – a program that reduced industry protection and the role of government in large areas of the economy? More to the point, *who* do we believe that reform program benefited?READ MORE
“Australian Exceptionalism”…. let that phrase roll off your tongue.
Now stop laughing for a moment if you can!
There’s something about that phrase that just doesn’t sit right with us. We’re not only unaccustomed to thinking about ourselves that way, but for many it’s a concept that is one part distasteful to three parts utterly ridiculous – try mentioning it in polite company sometime. Bring a helmet.
We’ll often laugh at the cognitive dissonance displayed by our American cousins when they start banging on about American Exceptionalism – waxing lyrical about the assumed ascendancy of their national exploits while they’re forced to take out a second mortgage to pay for a run of the mill medical procedure. That talk of exceptionalism has become little more than an exceptional disregard for the truth of their own comparative circumstances.
But in truth, we both share that common ignorance – we share a common state of denial about the hard realities of our own accomplishments compared to those of the rest of the world. While the Americans so often manifest it as a belief that they and they alone are the global benchmark for all human achievement, we simply refuse to acknowledge our own affluence and privilege – denialists of own hard won triumphs, often hysterically so.
Never before has there been a nation so completely oblivious to not just their own successes, but the sheer enormity of them, than Australia today.
In some respects, we have a long standing cultural disposition towards playing down any national accomplishment not achieved on a sporting field – one of the more bizarre national psychopathologies in the global pantheon of odd cultural behaviours – but to such an extreme have we taken this, we are no longer capable of seeing an honest reflection of ourselves in the mirror.
We see instead a distorted, self absorbed cliché of ourselves bordering on parody – struggling victims of tough social and economic circumstances that are not just entirely fictional, but comically separated from the reality of the world around us.
So preoccupied have we become with our own imagined hardships, so oblivious are we to the reality of our privileged circumstances, that when households earning over $150,000 a year complain about having government welfare payments scaled back, many of us treat it as a legitimate grievance.
Somewhere along the highway to prosperity – and an eight lane highway it has been – far too many of us somehow managed to confuse Cost Of Lifestyle with Cost Of Living. We managed to confuse government assistance as a means to enable the less well off to achieve a better standard of living and greater opportunity, with government assistance being a god given right to fund the self indulgences of an aspirational lifestyle choice beyond our income means. Too many of us have demanded our dreams be handed to us on a plate, and if our income couldn’t provide for them, we demanded that government should give us handouts to make up the difference.
So let us take a hard look at our economic reality.
Over the medium term, our broader economic performance has been nothing short of astonishing. Before the resources boom was even a twinkle in the eye of Chinese poverty alleviation, our performance was world beating – that is worth keeping in your thought orbit. Big Dirt has a bad habit of propagandising about their own contributions and the Australian public has a bad habit of believing them when it comes to our own national development of late.
Imagine if, in 1985, all OECD economies had exactly 100 units of GDP each. If we then tracked the growth of that GDP (using OECD data) over time with the actual growth rates achieved during that period (creating a basic index) – this is how economies changed (click to expand the charts)
Only Turkey, Israel, Ireland and Korea have experienced more growth – with Turkey and Korea pursuing the change from developing to developed status, Israel partially so as well and Ireland recovering from the economic lethargy of civil war, we are the highest growing country that can be remotely called a developed country with no unusual circumstances. Putting this into context, let’s trace that growth over the last 25 odd years with some of the countries we are often compared to.
It’s kind of mind blowing – we grew faster, significantly faster, than all of the countries we are usually compared to, including over the period before the resources boom. But you ain’t seen nothing yet.
“What about the distribution of that growth”, I hear you ask. “The poor missed out” you might also be tempted to add.
Using data from the freshly minted OECD report on international comparisons of income distribution and inequality, where the average income growth per year was measured among countries between the mid 1980’s and the late 2000’s, what we find is that Australia left just about everyone else for dead. Not just at the average, or total household income level, but also with the size of the income growth among the poorest 10% of our households *and* the richest 10% of our households.
First up, total population income growth in blue, bottom decile income growth (the poorest 10% of households) in red and the top decile income growth (the wealthiest 10%) in green for all OECD countries.
It’s interesting to note that the only countries where the poorest 10% of households experienced faster income growth than Australia was 4 of the five PIIGS countries – the current basket cases of Europe. Something might be said there about false growth and swings and roundabouts.
Looking at how our growth here compared to the usual suspects:
And for direct comparison:
It is true that the income of the wealthiest 10% of households in Australia grew faster than the income of the poorest 10% of households – the income of Australia’s wealthiest 10% of households grew faster than any other cohort in the OECD. But it’s also true that our poorest 10% of households experienced faster income growth than any country other than Spain and Ireland (who are now quickly reversing that growth with their economic woes) , and faster income growth than the top 10% of wealthiest households in *every other country*.
The income of our poor grew faster than the income of everyone else’s rich. Just chew on that reality for a bit. Let it roll around in your head.
While you’re chewing on that, let’s take a quick squiz at minimum wages. Again, using OECD data, if we turn hourly minimum wages into US dollar equivalents using purchasing power parity adjustments (so we can compare like with like), we can see how the real hourly minimum wage has operated in Australia compared to the nations we’re usually put in the same bucket with.
We have the highest minimum wages in the OECD. Worth noting too that despite the incessant whinging from the usual business lobbies in Australia, it hasn’t done our economic activity any harm. Now if we compare the ratio of these minimum wages to the average wage for each country, giving us a simple glance at the distribution of wages for each country (which the OECD also fortuitously provides, saving us time), what we find is that Australia, again, sits on top.
Our minimum wage is a lot closer to our average wage than comparable nations.
So our economy has grown faster than nearly all others, our household income has grown faster than nearly all others (including our poor having income growth higher than everyone else’s rich) and we have the highest minimum wages in the world. But wait, there’s more!READ MORE