Australian economic beliefs and our perceptions on the role of government

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?

Note the similarity between ALP and Coalition voters here – a bipartisan belief set.

With a clear majority of us believing that corporations received most of the benefit of the reform program, it’s worth looking at the support levels of individual reforms – they start to tell a story.

A majority believe that privatising Telstra was bad for Australia, a plurality believe that privatising Qantas and the Commonwealth Bank weren’t exactly crash hot ideas for the country either. GST, free trade agreements and floating the dollar – miscellaneous policy stuff – all received plurality support for being a good outcome, while compulsory superannuation and Medicare enjoy massive levels of community support.

What we start to see is that Australians like governments owning things and privatisation is still poisonous (as Anna Bligh and Andrew Fraser found out in Qld). This also becomes apparent when we start talking about banks:

A clear majority of Australians would support establishing a government owned bank!

Yet, we also see enormous levels of support for bank regulation of various forms – from interest rates to salary caps to fee regulation, while even supporting a super profits tax on our banking sector.

So taking a recap, we support the idea of small government – but only as a broad motherhood statement since we can’t find any area we would actually like government to become smaller in. We believe that government isn’t doing enough on public services like health, education and public transport infrastructure. We support industry assistance, we support government owning things and oppose privatisation. We believe that the economic reform program didn’t benefit ordinary Australians and that most of the benefits went to corporations. We also believe that, at least so far as banks are concerned, we don’t appear to have much trust in those corporations and are more than willing to regulate their activities and behaviour far, far more than we currently do.

What amused me recently was how many folks were surprised at the results of a recent Essential Report question on “Class Warfare”.

A plurality of respondents sided with the government on this – which surprised people – including a majority of support among those earning less than $600 per week and a plurality of those earning more than $1600 per week.

But we also need to keep in mind that this question was framed in terms of a partisan contest between Government and Opposition. When one side of politics has a big lead over the other, what we find happens (not occasionally, but as a general rule) is that the side with the big leads gets a boost to the results of the side of the argument they are supporting.

Far from this result being a surprise, the results were highly likely to have been boosted for the Opposition. If you removed partisan identification in the question and asked it again, you would very likely have had a large, clear majority of support for the underlying proposition in the question – that of hitting the extremely wealthy and large corporations with taxes to ensure that all Australians get their cut of the benefits.

A good example of the prominence of this type of belief can be seen in the results of a question that asked about a how return to surplus should be paid for.

If you have to have a surplus, increasing taxes for large corporations and reducing tax breaks for wealthy individuals gained clear majorities of support – majorities across political cohorts. It’s also interesting that the two ideas with the lowest levels of support were cutting welfare – to the unemployed and disabled gaining the least support, and middle class welfare getting the second lowest support rate.

Further on this theme of the way Australians perceive large corporations – particularly in the banking and finance sectors – we had this question about what is often described as a Tobin Tax

Again, a clear majority of support for higher levels of taxation on this sector.

Yet it isn’t only the big guys on the block where Australians support more government intervention and regulation – it’s a fairly broad canvas. To give an idea of the general zeitgeist involved here:

This poll result could also be called A Nightmare on Collins Street – home of the Institute of Public Affairs 😛 If it moves, we appear to be pretty happy to regulate it, often enthusiastically so.

One of the particular areas of regulation that gain a lot of attention in public debate is that of the labour market – particularly penalty rates of late.

Again we see robust bipartisan support levels for weekend penalty rates. Just as we believed the benefits of our previous economic reform program went mostly to corporations, we also believe that the benefits of labour market flexibility have mostly gone to employers, rather than employees – but with a twist:

A clear majority believe that employers are getting the most benefit, including majorities across the voting spectrum. The twist? Part time workers – the very group falling largely into the casual work category – have the lowest level of belief that casualisation mostly benefits employers.

On the question of whether employers should be required to provide more permanent jobs:

Here we still get a plurality of support, with Coalition voters the only major cohort opposed to such regulation.

So taking another recap – we support the idea of small government, but only as a broad motherhood statement since we can’t find any area we would actually like government to become smaller in. We believe that government isn’t doing enough on public services like health, education and public transport infrastructure. We support industry assistance, we support government owning things and oppose privatisation. We believe that the economic reform program didn’t benefit ordinary Australians and that most of the benefits went to corporations. We don’t appear to have much trust in those corporations and are more than willing to regulate their activities at a higher level than we currently do, including increasing their tax burden. We also believe that labour market flexibility has mostly benefited employers and that those employers should be required to provide more permanent jobs.

The story is starting to build – so what about foreign investment, particularly the types of foreign investment that will become increasingly important issues in Australia?

Australians have never been particularly fond of the idea of foreign investment and this year’s Lowy Poll asked a question that encapsulated this bugbear of ours with another – who owns our farm land.

The collision was quite something:

Not only were 81% of us opposed to our government allowing foreign companies to buy our farmland, 63% of us reacted strongly against it.

Increasingly, the source country for such investment in our agriculture is China – so what are our perceptions of Chinese investment?

A clear majority of Australians believe that our government is allowing too much investment from China. When explored further and those 56% were asked an additional set of questions, this is what we got:(click to expand)

You could write an entire thesis from those results. But it’s pretty consistent with the world view we have about our economy and the role of government generally. If we don’t particularly like or trust large domestic corporations such as the banks, big foreign controlled ones are on a hiding to nothing.

So keeping all that in mind – the broad picture of what we believe about the government and what role we believe the government should play in our economy – let’s turn now to our current views about the economy and our expectations of it over the next 12 months. These were taken in the few weeks before the latest national accounts figures were released.

Even though we are pessimistic, a plurality of us are satisfied with our current financial situation – almost a mirror image of the above result:

When asked about the state of the economy *compared* to other countries – we acknowledge that Australia is doing comparatively well

Yet when asked simply about the state of the Australian economy in an absolute sense– with no reference to other countries – we get a very different result:

Only around half as many people that believe we are doing well *comparatively*, believe we are doing well *absolutely*.

But if we change the question again, use international comparisons as context and add information about our unemployment rate, inflation rate and interest rates – the recognition level of the state of the Australian economy being “good” lifts substantially.

It’s almost as if there’s a substantial proportion of us that know the economy is good, but don’t really want to admit it unless we almost have to – which brings us to a funny little poll question worth mentioning on interest rates.

Only 35% of the country believe the correct answer – despite interest rates being the largest and most consistent economic talking point in the media cycle – and where not a single political cohort could reach a majority on that correct answer.

Finally, keeping in mind our general pessimism and our views on government assistance to industry – what are our views on government assistance towards each other? We already know that cutting unemployment benefits/disability support payments and middle class welfare were the two least supported options when it came to funding a return to surplus.

Firstly, we believe in means testing – at least as a motherhood statement roughly equivalent in vigour to our belief in small government:

Over two thirds of us believe in means testing government subsidies with clear majorities across all political cohorts. But moving beyond the general ideal – what do we believe about a particular subsidy, like, say, the private health insurance rebate?

Quite the collapse. Also worth noting is the result by income.

Similar to the way we support the idea of small government until it comes to finding some piece of government we actually believe should be smaller – we support the idea of means testing subsidies until the point comes where we are actually getting means tested on something.

Of course, this subsidy issue – being a partisan divide – has an appropriately large gap on the differences:

Not that hypocrisy has a partisan lean – keep in mind that if the political roles were reversed, so too would be the results.

What comes out from this broad snapshot is that what Australians believe about the role of government in our society and economy isn’t necessarily what our institutions believe or practice, and probably hasn’t been for a while. Our beliefs as a country are certainly far removed from many participants in the national debate that pretend to speak on behalf of our population and on behalf of our interests.

Whatever the faults, foibles or otherwise of these national beliefs – and this isn’t an exercise in either support of, or opposition to them – our national debates on the role of government in our society and economy are becoming increasingly isolated from what the majority of the country actually believes.

Our public debates assume that the benefits of privatisation have reached a conclusion – the public believes that privatisation was and is a catastrophe and that government should own a larger sector of the economy because we trust government more than large private sector corporations.

Our public debates assume that smaller government and less regulation is universally beneficial – the public supports substantially higher levels of regulation on just about any topic you care to name and struggles to find something they’d like the government to become smaller in.

Our public debates assume that economic reform has been such an obviously beneficial thing to ordinary Australians that it no longer needs explaining – the public believes that corporations took all benefits of that reform, leaving them with little more than a casualised workforce and reduced job security.

If we keep having our national debates like this – excluding larger and larger sections of our population and ignoring what they believe – they won’t be national debates, we’ll just be talking among ourselves generating ever increasing quantities of public opprobrium, contempt and general unhinging. If you haven’t noticed – this is where we are at right now.

Our national debates need more participants and institutions talking with and to the public, acknowledging what they believe, explaining the increasing complexity of the world and bringing the population along with them in the debate through persuasion. What we have now – a political system struggling to be heard calmly, institutions talking among themselves and a bunch of vested interests shouting and threatening everything that moves – let alone a media unsure of how to be a constructive participant anymore – it will only end in grief.

As a country we have an unparalleled opportunity right in front of us – not only in deciding the type of society we want to be, but having the capacity to generate the wealth we need to solve any and all of our problems. It would be a tragedy if we fucked this up because some of us refused to acknowledge how important it actually is to bring the public along with us.

(Visited 1,021 times, 2 visits today)