Self-interest didn’t swing the election results, but the scare campaign did

by Danielle Wood

Published by The Guardian, Thursday 23 May

As Labor’s shock defeat crystallised on Saturday night, it didn’t take long for commentators to draw parallels with the unlosable 1993 election. Once again an opposition party within striking distance took a bold tax agenda to an election and was rebuffed by voters.

But the emerging consensus that Labor’s tax plans – particularly the changes to franking credit refunds and negative gearing – are solely responsible for its defeat is far too simplistic.

The voting figures do not support the idea that angry self-refunded retirees and aspiring property investors had the baseball bats ready for Labor. In fact, many of the areas where people get big tax benefits from negative gearing and franking credits swung away from the Coalition.

There were undoubtedly people across the country angry enough about these policies to switch their votes. But the proportion of people over 60 in different electorates had no correlation with the Liberal swing. Other analysis indicates the share of people claiming rental losses and franking credits by electorate was correlated with a swing towards Labor. The overall results suggest the well-heeled were voting on grounds other than their immediate financial self-interest.

Conversely, the seats that swung most strongly to the Coalition on a two-party-preferred basis – including Dawson, Capricornia, Hunter, Herbert and Forde – span regions with significant economic challenges. Average incomes vary but unemployment levels are above the national average. A much lower share of people in these electorates have tertiary education and so workers are more likely to feel exposed to the threat of unemployment. It seems unlikely that the loss of tax breaks for well-off retirees was high on the protest list for these voters.

These results are consistent with the national trends. Seats with lower-than-average incomes and education were more likely to swing to the Coalition. Tony Abbott nailed it on election night when he said: “It’s clear that in what might be described as working seats, we are doing so much better [than Labor].”

The result is almost paradoxical. Labor wanted to scale back tax concessions for the “top end of town” and more to support the less-well-off through investments in social services. But the top end of town embraced them (or at least rejected their opponents) and the people who stood to benefit most instead embraced the Coalition, One Nation and the United Australia party.

So if self-interest didn’t swing the vote, what did?

Labor’s plan was bold, and bold is easy to portray as scary. Clive Palmer spent a fair chunk of his reported $60m doing just that. Real estate agents with plenty to lose from the proposals used heavy-handed tactics to frighten renters into thinking that they would be the ultimate losers from the negative gearing changes. And among the Coalition’s most effective lines was that “Labor can’t manage money so they’ll come after yours.”

Scare campaigns are not new in politics. But a scattergun message from Labor and an increasingly cynical electorate helped this one hit the target.

First to the messaging. The campaign was variously about intergenerational fairness, a referendum on cost of living and wages and better schools and hospitals. The spending announcements came thick and fast during the campaign – from eliminating out-of-pockets for cancer treatment, a pensioner dental scheme, boosting childcare subsidies, increasing wages for childcare workers and $10bn for the Melbourne suburban rail loop. Some of these were well thought out, others seemed more than a little underdone. And even as someone who follows the policy debate it was hard to keep up.

A big, bold reform program requires voters to take some things on faith. Few outside those directly affected have the time or inclination to delve into the complex details of tax treatment of investment properties or to understand franking credit refunds. In this election, voters were asked to take Labor on trust that its policy plans would not take jobs and the economy down with them.

But trust in politics is in short supply these days. The Australian Election Study, a survey taken after each federal election since 1969, showed voter trust was at its lowest after the 2016 election. My guess is that the 2019 survey will show we have now hit a new low. And voters with lower average levels of income and education have less trust than those in more affluent areas. Narratives need to be clear and powerful to cut through the cynicism.

Labor will undoubtedly spend time soul-searching about what it all means. I hope they don’t take the message that major policy change should be consigned to the too-hard basket. The silver lining is that voters can be convinced to put the national interest before immediate self-interest. The challenge for political leaders is to build the trust and understanding with the electorate to back in their vision.