Don’t give up on politics. It’s where the fight for the fair go must be won



File 20181102 83629 1kvqfit.jpg?ixlib=rb 1.1
Governments have made a difference to inequality in the past, as Roosevelt’s New Deal did in the 1930s, and could do so again if citizens acted to ensure their voices are heard.
Wikimedia

Marc Stears, University of Sydney

This article is the third in the Reclaiming the Fair Go series, a collaboration between The Conversation, the Sydney Democracy Network and the Sydney Peace Foundation to mark the awarding of the 2018 Sydney Peace Prize to Nobel laureate and economics professor Joseph Stiglitz. These articles reflect on the crisis caused by economic inequality and on how we can break the cycle of power and greed to enable all peoples and the planet to flourish. The Sydney Peace Prize will be presented on November 15 (tickets here).


Deepening economic inequality is a scourge across most of the world’s democracies. For decades now, the gap between the wealthiest and the poorest has been widening. This has very real and very dangerous consequences for people’s mental and physical health and for the cohesion of our communities. So why isn’t anything serious being done about it?

Reversing this trend, or at least ameliorating it, would not be difficult. Economists around the world have spent the last few years laying out some fairly straightforward policy solutions. These range from reform of the rules governing how pay is set in the big corporations to sustained investment in the foundational social services that everyone but the very richest relies upon, including public education, health and housing.

Despite this clarity, very few of these initiatives are being pursued in any of the developed democracies. Instead, political action remains focused on tax cuts that favour the wealthy or big business, on immigration restrictions that can hinder economic growth, and on public subsidies for a handful of old industries, even where there are environmental reasons to be transitioning away from them.




Read more:
The fair go is a fading dream, but don’t write it off


Why the inaction on inequality?

The question that matters more than almost any other when it comes to inequality right now, then, is not whether it is a problem or how to resolve it, but what is it that’s holding us back from doing what we need to do?

The answer to this question cannot lie in an absence of practice, knowledge or understanding. Most countries successfully initiated inequality-tackling reforms in previous generations. And they often did so in far more pressing political and economic circumstances, such as the Great Depression of the 1930s or the immediate aftermath of the second world war.

Joseph Stiglitz.
Bengt Oberger/Wikimedia, CC BY-SA

Even where there is not previous experience to draw upon, politicians and their advisers can draw upon a host of more recent studies of the causes, consequences and potential responses to the rise of inequality. This includes the work of this year’s Sydney Peace Prize recipient, Joseph Stiglitz. There is no shortage of expertise for a new generation of egalitarian reformers to draw upon.

Nor does the answer lie in entrenched public unwillingness to tackle the problem. It is true that in the 1980s and 1990s, electorates the world over were often skittish about interventionist economic policy proposals. They favoured tax reductions over public service investment and were anxious about government’s efforts to “pick winners” in the economy.

But such anxiety has greatly lessened right now. Indeed, polling consistently suggests that even in countries without a sustained tradition of government action against inequality, a large public appetite now exists for measures to tackle it. Such measures, stretching from sharp increases in minimum wages to the nationalisation of major public utilities, enjoy majority support in many democracies.

We have also witnessed electorates across the world take bold and risky decisions in their voting behaviour. This includes support for extremist political movements motivated partly by a desire fundamentally to shift away from the status quo.

The problem lies with our politics

If the problem does not lie in knowledge or public support, it must lie somewhere that does not currently get enough attention: in our processes of policymaking – in short, our politics.

Political life in the developed democracies has been radically transformed in the last few decades. Usually this is told in a storybook version, with an endless rise of openness and inclusivity.

In the early decades of the 20th century, this narrative goes, women and the poorest won the vote. In the middle of the century, trade unions and civil society organisations exerted increasing influence on national political decision-making. And as the century aged, other groups including LGBTQI action groups, minority and indigenous populations began to find some long-denied political influence.

But there is another, far darker story to tell. The last few decades have witnessed the rise of another way of doing politics. The anthropologist Janine Wedel brilliantly describes that way in Unaccountable: How Elite Power Brokers Corrupt our Finances, Freedom, and Security (2014).

It is the world of the professional lobbyist, of the revolving door between global corporations and the highest levels of government, of uneasy relationships between public decision-making and private profit, and of the capture of elite thinking by norms and expectations that owe too much to the practices of the financial services sector.

Meet the New Influence Elites, a 2016 IPR Public Lecture by Professor Janine Wedel.

All of this has happened at the same time, of course, as a sharp decline in the organisations that used to do much to hold these tendencies back. Union membership has fallen rapidly in the advanced democracies, for instance. And formal mechanisms that guaranteed that governments had to explain their policy decisions to multiple stakeholders have been eroded across the world.




Read more:
To tackle inequality, we must start in the labour market


As a result, the salience of issues such as “what the public thinks” and “what the public needs” when it comes to the economy have been significantly eroded as well.

What all of this means is that economic decision-making increasingly responds to a narrower and narrower section of society. In such circumstances, it is no wonder that almost no concerted action has been taken to halt the rise of inequality.

Fight for the fair go is political first

What it also means, though, is that the action we need to restore the fair go cannot begin with the economy. It must instead begin with policymaking and politics.

We need to make sure the voices of those affected by inequality are genuinely heard and heeded. This commitment should run through everything we do: from supporting our local trade union to opening up scholarly resources to those people in need, from demanding action to rein in corporate lobbying and special access to generating exciting and innovative ideas for using new technologies to accentuate the voice of those without access to formal power.

These ideas are where our energy needs to be. If we want to see greater equality, we need to spend time working out precisely how our political life can become truly responsive. And then we must campaign to make those changes real.


You can read other articles in the series here.




Read more:
Why are unions so unhappy? An economic explanation of the Change the Rules campaign


The Conversation


Marc Stears, Professor and Director, Sydney Policy Lab, University of Sydney

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Advertisements

Poll wrap: Coalition, Morrison slip further in Newspoll; US Democrats gain in late counting



File 20181112 35554 1dgvw65.jpg?ixlib=rb 1.1
The polls are not moving in the right direction for Prime Minister Scott Morrison.
AAP/Ben Rushton

Adrian Beaumont, University of Melbourne

This week’s Newspoll, conducted November 8-11 from a sample of 1,800, gave Labor a large 55-45 lead, a one-point gain for Labor since last fortnight. Primary votes were 40% Labor (up one), 35% Coalition (down one), 9% Greens (steady) and 6% One Nation (steady).

This is the second consecutive Newspoll drop for the Coalition, after they recovered somewhat from the post-spill fallout to trail 53-47 four weeks ago. In Malcolm Turnbull’s final four Newspolls as PM, the Coalition trailed by just 51-49; the situation is far worse for them now.

Labor’s primary vote in this poll has returned to 40%, a level only exceeded in the first two polls after Turnbull was ousted. Before those two polls, Labor’s support in Newspoll had only been at 40% or more once since Julia Gillard’s early days as PM.




Read more:
Grattan on Friday: Turnbull tells Liberals to answer that unanswerable question


39% were satisfied with Scott Morrison’s performance (down two), and 47% were dissatisfied (up three), for a net approval of -8, down five points. Bill Shorten’s net approval dropped two points to -15. Morrison led Shorten by 42-36 as better PM (43-35 last fortnight).

By 48-40, voters were opposed to Australia becoming a republic, a dramatic shift from a 50-41 margin in favour of a republic in April. This is the first time since the republic referendum in 1999 that those opposed have outnumbered those in favour. The popularity of Princes Harry and William (see Essential below) probably explains this shift.

This Newspoll was the fifth to gauge Morrison’s ratings. Turnbull’s net approval peaked at +38 in his fifth Newspoll, in November 2015, before starting a long decline. Morrison’s net approval peaked at +7 in his third Newspoll, and he has lost a net 15 points since that peak.

I have said before that the Coalition under Morrison would probably have problems with the educated people who were drawn to Turnbull. To compensate, Morrison needs to outperform Turnbull among those without high levels of educational attainment.

For these people, personal economic fortunes are probably a key concern. As long as wages growth remains low, Labor and the unions will be able to win support from this group. In my opinion, the Coalition’s only realistic chance of re-election is for wages to improve strongly by the time the next election is due in May 2019. The ABS will release data for wages in the September quarter on Wednesday.

Essential: 54-46 to Labor

In last week’s Essential poll, conducted November 1-4 from a sample of 1,028, Labor led by 54-46, a one-point gain for Labor since three weeks ago. Primary votes were 39% Labor (up two), 36% Coalition (down two), 10% Greens (steady) and 6% One Nation (down one). Rounding probably assisted the Coalition in this poll. While it is not as bad as Newspoll for the Coalition, the movement in Essential agrees with Newspoll.

Morrison’s net approval was +4, down 11 points since October. Shorten’s net approval was -6, up six points. Morrison led Shorten by 41-29 as better PM (42-27 in October).

By 44-32, voters supported Australia becoming a republic with its own head of state (48-30 in May). Over 60% had favourable opinions of Queen Elizabeth and Princes Harry and William, but opinion was split 33-30 favourable on Prince Charles.

By 39-35, voters approved of government support for new coal-fired power stations. Just 8% said they had a high interest in horse racing, while 44% said they had no interest.

Queensland Galaxy: 50-50 tie federally, 53-47 to state Labor

A Queensland Galaxy poll, conducted November 7-8 from a sample of 839, had a federal 50-50 tie in Queensland, unchanged from August when Turnbull was still PM. Primary votes were 38% Coalition (up one), 34% Labor (steady), 9% Greens (steady) and 9% One Nation (down one).

This poll would be a 4% swing to Labor from the 2016 election in Queensland, so it is not good news for the Coalition (the national swing in Newspoll would be just over 5%). One of the reasons given for replacing Turnbull was that he was on the nose in Queensland. Under Morrison, the Coalition is matching its position in Queensland compared to Turnbull, but it is performing far worse in the rest of Australia.

The same poll gave state Labor a 53-47 lead, a two-point gain for Labor since August. Primary votes were 36% Labor (up one), 34% LNP (down three), 11% Greens (steady) and 10% One Nation (steady).

46% (up five) approved of Premier Annastacia Palaszczuk, and 37% (down one) disapproved, for a net approval of +9, up six points. Opposition Leader Deb Frecklington had a +6 net approval, up one point. Palaszczuk led as better Premier by 43-26 (44-23 in August).

Late counting strongly favours Democrats in US midterms

Late counting for the November 6 US midterm elections has heavily favoured the Democrats, and they have reversed some election-night Republican leads in House and Senate seats.




Read more:
Democrats take House at US midterm elections, but Republicans keep Senate; Labor well ahead in Victoria


The House is likely to finish at a 234-201 Democrat majority, which would be a net gain of 40 for the Democrats since the 2016 election. That would be Democrats’ highest number of gains in a House election since 1974 – despite the strong US economy and Republican gerrymandering.

The Senate is likely to finish at a 53-47 Republican majority, a two-seat net gain for the Republicans since the 2012 election, the last time these seats were contested; Democrats had a great year in 2012. Democrats lost North Dakota, Indiana, Missouri and likely Florida, but gained Nevada and likely Arizona. A Democrat win in Arizona would be their first Arizona senator elected since 1988.

I wrote in August that Trump’s ratings were well below where they should be given the strong US economy. If he had not been so blatantly right-wing on many issues, Trump’s ratings would probably have been far better at the midterms, and the Republicans would have held the suburban seats that they lost.




Read more:
Polls update: Trump’s ratings held up by US economy; Australian polls steady


Democrats currently lead in the House popular vote by 6.5 points, and it is likely to end at about an eight-point Democrat margin. Rasmussen polls, which always give Trump far better ratings than other pollsters, had Republicans winning the House popular vote by one point.The Conversation

Adrian Beaumont, Honorary Associate, School of Mathematics and Statistics, University of Melbourne

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Two past coup leaders face off in Fiji election as Australia sharpens its focus on Pacific



File 20181108 74775 5p3kvo.jpg?ixlib=rb 1.1
Fiji’s Prime Minister Josaia Voreqe “Frank” Bainimarama speaking at a trade forum in Brisbane in July last year.

Dominic O’Sullivan, Charles Sturt University

Fiji faces a general election on Wednesday, just as Australia’s main political parties devote more attention to the western Pacific, driven by worries about China’s growing influence in the region.

For most Australians, the nation is a handy holiday destination – closer than Bali or Thailand. Last month, its palm-fringed beaches were in the global spotlight when the Duke and Duchess of Sussex took a trip to the former British colony.

Anyone with a longer memory will perhaps associate Fiji with coups – two in 1987 and one in 2006. There was also a putsch – a civilian overthrow of the government – in 2000.

This week’s general election is only the second since Josaia Voreqe Bainimarama, who often goes by the name Frank, appointed himself prime minister after the 2006 coup. He was eventually elected in 2014 and is expected to be re-elected this week.




Read more:
Fiji coup leader gets the democratic approval he wanted


For Australia, the strategic importance of the western Pacific is coming into sharp focus.

Prime Minister Scott Morrison has announced $3 billion in infrastructural spending in the region. He has committed the Australian Defence Force to military training in Pacific nations.

Australia has an abiding interest in a south-west Pacific that is secure strategically, stable economically and sovereign politically.

In a speech to the Lowy Institute last month, Bill Shorten committed a future Labor government to an independent foreign policy with a strong Pacific focus. It would support Fiji, Papua New Guinea and Tonga to develop their military capabilities.




Read more:
Labor is making big promises for a Pacific development bank, but questions remain


On Fiji, he said:

We want to mend the relationship with the RFMF [Republic of Fiji Military Forces], to ensure that the ADF [Australian Defence Force] is best-placed to develop the Fiji military’s professional capabilities and to ensure Fiji’s security needs.

For Fijian voters, the military is never far from politics.

Bainimarama insists the election will be free and fair . However, the electoral system is unnecessarily complicated. Critics argue this is a deliberate strategy to disenfranchise voters.

However, as he disliked the Constitution put to him by an independent review in 2009, Bainimarama decreed his own in 2013. Section 131 (2) of that Constitution gives ultimate political authority to the military:

It shall be the overall responsibility of the Republic of Fiji Military Forces to ensure at all times the security, defence and well-being of Fiji and all Fijians.




Read more:
Fiji’s media still struggling to regain ‘free and fair’ space


The military has tended to be the arbiter in national affairs since the first coup in 1987.

As Bainimarama put it before the 2006 coup:

[Prime Minister Laisenia] Qarase is trying to weaken the army by trying to remove me … if he succeeds there will be no one to monitor them, and imagine how corrupt it is going to be.

The coups and the putsch were ostensibly statements of indigenous nationalism – indigenous Fijians asserting their rights over the generally wealthier and better educated descendants of Indian indentured labourers brought to Fiji by British colonial authorities between 1879 and 1916.

However, Fijian politics is vastly more complicated than an indigenous non-indigenous binary. The contentious point, according to Professor Brij V. Lal of the Australian National University’s College of Asia and the Pacific, “is not really about having a Fijian head of government,” but rather which Fijian leader would be acceptable to a particular group of Fijians at any given time”.

The prime minister’s main rival clears legal hurdle

Bainimarama’s main opponent is an indigenous former prime minister and coup leader, Sitiveni Rabuka. Bainimarama is also an indigenous Fijian.

Rabuka faced electoral fraud charges that could have seen him declared him ineligible to stand at the election. Rabuka’s acquittal in the Magistrate’s Court was appealed by the Fiji Independent Commission Against Corruption, and dismissed by the High Court only on Monday afternoon. At his campaign launch in 2018, Rabuka ominously remarked:

I am here to do what I can for as long as I ever can for the good of the country.

However, indigenous nationalism and how the right to self-determination might be played out is important. It is interwoven with class, religion and an urban/rural divide to add to the fragility and complexity of Fiji’s conditional democracy.

Just as it did in 2014, Bainimarama’s Fiji First is campaigning on a range of issues including the building of a multiracial society. Practical measures to improve access to education and healthcare are also important to Fiji First.

Land ownership and rental returns are key political issues

Rabuka’s Social Democratic Liberal Party (SODELPA) argues for the restoration of distinctive indigenous voice in public life. It seeks the restoration of the Great Council of Chiefs and of chiefly influence over the distribution of rental incomes.

SODELPA will also begin extensive public consultation on the drafting of a new Constitution.

Ultimately, indigenous prosperity depends on the strength of the national economy. This, in turn, depends on political stability. Contemporary Fiji enjoys neither. While there are signs of improving economic growth, the Fijian people face two obstacles in ensuring that the outcome of Wednesday’s election reflects their collective will.

Firstly, registering to vote then casting a valid and informed vote is difficult. Secondly, as Fiji’s history since 1987 shows, and as the 2013 Constitution confirms, the election’s outcome is ultimately subject to military approval. It may not, then, be in Australia’s best interests to support a stronger Fijian military.

Democratic stability serves Australia’s interests. In Fiji, democracy can be strong only when the military is weak.The Conversation

Dominic O’Sullivan, Associate Professor of Political Science, Charles Sturt University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Government falls further behind – Labor leads 55-45% in Newspoll


Michelle Grattan, University of Canberra

The Coalition has taken another knock in Newspoll, now trailing Labor 45-55% on a two-party basis.

Scott Morrison’s personal ratings have also worsened, in a poll that comes in the wake of his intensive week of campaigning in the key state of Queensland.

This is the second consecutive Newspoll in which the two-party vote has gone backwards: the previous poll had a 46-54% result.

The Newspolls have been consistently worse for the Coalition since the
leadership change – before that Labor had been cut back to a narrow 51-49% lead.

Morrison’s net satisfaction rating is now minus 8, compared with minus 3 in the last poll a fortnight ago. Bill Shorten had a slight worsening on this measure – he is on minus 15 compared with minus 13 in the previous poll.

The gap on “better prime minister” has narrowed in Shorten’s favor – Morrison leads 42-36% compared with 43-35% previously.

Labor’s primary vote is up a point to 40%; the Coalition has dropped a point to 35%. The Greens remain on 9%; One Nation is steady on 6%.

Newspoll also found that only 40% of people now favour Australia becoming a republic, compared with 48% against. Shorten has promised
an early vote on the issue if he wins government.

Support for a republic was 50% in April this year, with 41% against.
The dramatic change suggests the big impact of the highly popular tour
of the young royals, the Duke and Duchess of Sussex.

Although Coalition MPs have argued that Morrison has a better “cut through” than Malcolm Turnbull, Morrison’s sliding ratings suggests his “ordinary bloke” style isn’t going across as well as some expected.

The poll was taken Thursday to Sunday, so the publicity around Turnbull’s performance on Q&A on Thursday would have fed into it. He
declared that former colleagues had not so far answered the question
of why they had dumped him and owed an explanation to the Australian
public.




Read more:
Grattan on Friday: Turnbull tells Liberals to answer that unanswerable question


This week Morrison begins the “summit season” with the East Asia
summit in Singapore followed by APEC in Papua New Guinea.

POSTSCRIPT:

Morrison, asked about the poll, told Sky: “It’s a big mountain, and
I’m still climbing it”. He said the poll showed there was “a big risk”
of a Labor government.The Conversation

Michelle Grattan, Professorial Fellow, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Grattan on Friday: Turnbull tells Liberals to answer that unanswerable question



File 20181108 74763 1d8mxo.jpg?ixlib=rb 1.1
Malcolm Turnbull used his appearance on Q&A to hold his political executioners to account.
AAP

Michelle Grattan, University of Canberra

Malcolm Turnbull has delivered a hefty blow to the struggling Morrison
government by refocusing attention on the one question it has
desperately tried to smother.

That is: why was he sacked?

When he appeared on Thursday’s Q&A special, Turnbull was on a dual
mission. His neat blue jacket told the story. There would be no
reversion to the pre-prime ministerial free-wheeler dressed in
leather.

He was there to hold his executioners to account, to ensure they have
no escape, from him or from the public. And he was primed to defend
his record, to write the history of his three years in office as a
story of accomplishment and success. He wants to be defined by what he
did, rather than by how badly things ended.

Essentially he presented himself simultaneously as the victim and the victor.

The opening question was predictable but central: “Why aren’t you
still prime minister?”

Turnbull’s reply was rehearsed and targeted personally as well as generally.

This was “the question I can’t answer,” he said. “The only people that
can answer that are the people that engineered the coup – people like
Peter Dutton and Tony Abbott and Greg Hunt and Mathias Cormann – the
people who voted for the spill.

“So, there are 45 of them…. They have to answer that question.”

He rammed home the message. People had to be “adults and be
accountable”. Members of parliament “have to stand up and be prepared
to say why they do things”.

So those who chose “to blow up the government, to bring my prime
ministership to an end … they need to really explain why they did it.
And none of them have.”




Read more:
Grattan on Friday: Now Malcolm Turnbull is the sniper at the window


So much for Scott Morrison arguing the public have gone beyond the
“Muppet show”, or defence industry minister Steve Ciobo claiming
Australians didn’t care about what had happened.

Labor has kept pressing on the “why” question, even when commentators
doubted the tactic, and now Turnbull has given the opposition a load
of fresh ammunition.

This makes it harder for ministers to shrug off Labor’s harking back
to the coup. To do so drags them into criticism of Turnbull, which is
counterproductive.

Once again Bill Shorten is the beneficiary of his opponents’ self-destruction.

Turnbull saw a “fair prospect” of the issue resonating in next year’s
election campaign because “Australians are entitled to know the
answer”.

In wishing Morrison “all the best in the election”, Turnbull
emphasised that he personally was out of parliament and he’d had
little to say since he’d left – he’d wanted to give his successor
“clear air”.

But there’s an ambivalence in Turnbull’s behaviour towards Morrison.
When his own leadership was doomed he helped Morrison beat Dutton. But
his intervention is now hurting his successor.

Of course Turnbull’s assertion he’s “out of politics” is disingenuous,
or at least premature. What could be more political than Thursday
night’s performance?

Apart from injecting new vigor into the issue of his sacking, his
critique of the Liberal party’s move to the right was powerful and
damaging, encapsulated in his observation about Liberal-minded voters
installing like-minded crossbenchers.

He pointed to Mayo, Indi and Wentworth, seats previously solid
Liberal. “They are now occupied by three Independents who are all
women, who are all small-l liberals, and all of whom, in one way or
another, have been involved in the Liberal Party in the past,” he
said.

By electing these independents the voters were saying “we are
concerned that the Liberal Party is not speaking for small-l liberal
values”, he said.

This brings to mind the speculation about a possible high-profile
independent emerging in Warringah who could give Tony Abbott a run for
his money.

There was much else in the Turnbull hour that was challenging for the
government, including his belief the Liberals would have held
Wentworth but for the campaign’s “messy” final week, and his criticism
of the “blokey” culture of parliament.

Turnbull talked up an extensive legacy for himself, highlighting the
achievement of same-sex marriage (though some would give the praise to
certain pesky backbenchers). Typically, he wouldn’t cede ground over
standing back from the battle in his old seat.

As always with Turnbull, Thursday’s appearance will polarise Liberals,
making it uncertain whether it will help or harm his reputation.
Enemies will see it as being all about Malcolm. His comments will
start another round of divisive debate in the ranks.

But his arguments were potent reminders of the stupidity of what
happened in August and the present poor state and situation of the
Liberal party.

Morrison this week had to deal with an early manifestation of the hung
parliament he now must manage.

Crossbencher Bob Katter saw the opportunity to make some gains for his
north Queensland electorate of Kennedy during Morrison’s tour of the
state, so the maverick MP suggested he might consider supporting the
referral of Liberal MP Chris Crewther to the High Court over a
possible section 44 problem.

By Thursday Morrison had met Katter, and extracted a pledge of
“ongoing support of the government”. Katter had extracted dollops of
money for water projects.

Their respective performances this week emphasised the
chalk-and-cheese contrast between the former and current prime
ministers, a difference being accentuated by Morrison as he seeks to
portray himself as a man of the people.




Read more:
View from The Hill: Katter waves Section 44 stick in a ‘notice North Queensland’ moment


Turnbull was critical of the hard right wing media; Morrison in the
past few days has done an interview with Alan Jones and a Sky people’s
forum in Townsville hosted by Paul Murray.

Turnbull might have had a penchant for trams and trains with selfies
but not the faux bus tour with cheesy videos.

But as Turnbull said of the man who’s inherited the fallout of the
August “madness”: “He has dealt himself a very tough hand of cards,
and now he has to play them … he has to get on with it.”

With Morrison it is not so much a matter of getting on with it –
he’s hyperactive – but of precisely what it is that he’s getting on
with.The Conversation

Michelle Grattan, Professorial Fellow, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Australia’s dangerous fantasy: diverting population growth to the regions


John Daley, Grattan Institute and Jonathan Nolan, Grattan Institute

This week we’re exploring the state of nine different policy areas across Australia’s states, as detailed in Grattan Institute’s State Orange Book 2018. Read the other articles in the series here.


A dangerous fantasy is taking hold in Australia: that government policy can divert population growth from our bulging capital cities to our needy regions. It’s a fantasy because a century of Australian history shows it won’t work. And it’s dangerous because it gives governments an excuse to avoid the hard decisions on planning and transport needed to make housing more affordable and cities more liveable.

Since Federation, state and federal governments have tried to lure people, trade and business away from the capital cities. These efforts have mostly been expensive policy failures.

Despite substantial government spending on regional development aimed at promoting decentralisation, Grattan Institute’s State Orange Book 2018 shows the trend to city-centred growth has accelerated in the past decade. Less than a third of us now live outside the capital cities.


Grattan Institute State Orange Book 2018

With the exception of Western Australian and Queensland mining regions, capital city economies over ten years have grown faster than regional economies. That’s mainly because their populations have grown faster.

Incomes per capita, on the other hand, have generally grown at about the same pace. Employment participation for women is similar too, although 25-to-64-year-old men in regions are 7% less likely to work than men in cities.


Grattan Institute State Orange Book 2018

Why do most people choose to live in cities?

These are global trends. Large cities around the world are typically growing much faster than less densely populated areas. Even in Japan, where the national population is declining, Tokyo continues to grow.

The economic advantages of cities over regions appear to be increasing as people spend more of their incomes on services rather than goods. Services businesses often prefer to be close to other services businesses, typically in large cities.

Regional growth programs in Australia have a poor record of trying to push economic water uphill against these trends.

Take for example the New South Wales home buyers’ grant of $7,000 for people who move from cities to regions. Some 10,000 people were expected to take up the offer in the first year. In fact, only 4,800 grants were made over three years. Many of those probably went to people who would have moved anyway – perhaps to retire to “the bush”.

The key problem is that people will only move to regions if there are extra jobs. And policies to encourage more jobs in regional areas also have a poor track record. The money on offer from government is rarely enough to outweigh the economic advantages for a business of locating in a city instead.

Most of the time we don’t even know whether regional development programs work because they are so badly administered. Auditors-general in NSW, Victoria, Queensland and WA have all found substantial regional development money being spent with no business case, or poor documentation, or without reference to application guidelines, and with no evaluation of whether the programs achieved the promised outcomes.


Grattan Institute State Orange Book 2018

The overwhelming impression is that governments don’t really want programs evaluated because they know all too well what the answers will be.

What if regional population policies did work?

In the unlikely event that government policy actually succeeded in encouraging many more people and employers to move to regional areas, it would probably slow growth in incomes. Cities are more productive, and this is reflected in higher wages.

Cities are important for innovation and economic growth. Cities offer more opportunities to share ideas, which both attracts skilled people and increases their skills once they arrive. Despite the rise of the internet and reduced telecommunication costs, innovation seems to rely on regular face-to-face contact between people in different firms, which therefore tend to aggregate in large cities.

So pushing extra people to regional areas runs the risk of reducing Australia’s productivity growth and per capita incomes.

So what about regional ‘dormitory’ suburbs?

Another strategy, much discussed in Victoria as it heads into a state election campaign, is to encourage the growth of regional towns as dormitory suburbs for people working in cities. Obviously this only works for regional towns that are relatively close to capital cities, with good transport links. Hence the big-spending promises to upgrade regional rail services.

But it is unclear why regional dormitories should be considered better than building suburbs on the city fringe. These fringe suburbs often provide access to more jobs in the other suburbs nearby.

In any case, the transport infrastructure needed to ferry people from homes in regional areas to jobs in the city is not cheap. Far better to relax planning laws to allow higher-density living where people want to live and can be close to a wide range of jobs – that is, in the established middle and inner suburbs of the capital cities.

The danger of distorted spending priorities

The fantasy that governments can divert population growth from cities to regions is also dangerous because it distorts spending priorities in regions. Government services probably improve regional lives more than government spending that is supposed to promote business growth. Government spending on regional arts and sports facilities probably has a much bigger impact per dollar than an extra kilometre of dual-lane highway.

Government spending per person on education and health is in fact already higher in regions than in cities, even if service levels are often lower because they cost more to deliver. But if governments are going to spend more on regional services, the money may need to be spent differently.


Grattan Institute State Orange Book 2018

Grattan Institute analysis shows that poorer health and educational outcomes in some regional areas are primarily the result of socio-economic status and other risk factors – not remoteness. In health, for example, the substantial gap in mortality between regions and cities appears to result not from more distant hospitals but from people in regions tending to exercise less and have poorer diets.

Economic theory and policy experience, in Australia and other advanced economies, expose the “repopulate the regions” push as wishing thinking. As this series of articles based on Grattan Institute’s State Orange Book 2018 will show, there are better ways for governments to promote a growing Australia.The Conversation

John Daley, Chief Executive Officer, Grattan Institute and Jonathan Nolan, Associate, Grattan Institute

This article is republished from The Conversation under a Creative Commons license. Read the original article.

State governments are vital for Australian democracy: here’s why



File 20181028 7056 15kvq0w.png?ixlib=rb 1.1
State government remains an important part of the Australian political landscape.
Wes Mountain/The Conversation, CC BY-ND

Frank Bongiorno, Australian National University

As Victorians head to the polls in less than four weeks, there is a wider question worth considering than whether or not the Andrews government is likely to be given another term. Do state governments actually matter?

Imre Salusinszky, a former adviser to then- New South Wales premier Mike Baird, recently tweeted: “State government in 2018 is about running four or five businesses. The whole Westminster thing is preposterous. An efficient model would be a six-person executive guided by a People’s Convention meeting biennially for a month. Doesn’t need party politics and chocolate soldiers”.

That seems unlikely, but the idea that state governments have become too municipal to be taken seriously is familiar. For decades, federal politicians with a high opinion of themselves have treated the state government as beneath their notice or contempt.




Read more:
Three areas to reform federal-state financial relations


The exposure of the rorting and corruption of a number of state politicians – notoriously Eddie Obeid and Ian Macdonald during the most recent period of Labor government in New South Wales – has also fuelled a more general contempt for state politics. But the states at least have well-developed integrity systems that have landed a few crooks in prison. It would be mischievous as well as libellous to explore whether some of their federal counterparts have been cleaner or luckier.

The habit of treating state government as a poor relation might not be recent. Most of the big names in colonial politics headed straight into the Commonwealth parliament in 1901. Later, it is doubtful whether a federal politician would have ridiculed a Jack Lang or Ted Theodore – New South Wales and Queensland Labor premiers respectively – as dealers in triviality. But they, too, eventually headed for national politics.

With their eyes on the growing power and prestige of federal government as it acquired ever stronger control of national finances, historians have underestimated the continuing significance of the states in major policy areas. Land has always been a big one, as it is today in relation to housing affordability and urban development.

In earlier periods, closer settlement, soldier settlement and land taxation were all state matters. There is also mining. When he was Western Australian minister for industrial development in the 1960s, Charles Court was practically running an arm of Australia’s international policy in his negotiations with the Japanese over new iron-ore projects.

Large fields of activity remained predominantly state matters after federation – education, health and hospitals, public transport and roads, local government, and law and order. The capacity of the Commonwealth to act in a range of fields was either untested, or tested and found wanting.

In the area of social security, it was far from clear before the second world war that the Commonwealth would become predominant. The Commonwealth also left some fields to the states even where its authority to act was unquestioned – such as in marriage and divorce law before 1959-61.

For much of the twentieth century, most major public utilities, such as railways, were controlled by the states. Many became massive government bureaucracies and monopolies. On a smaller scale, Queensland had state-owned butcher shops and pubs.

In social, industrial and conservation policy, the New South Wales Labor governments of the 1940s, 1950s and 1960s showed that caution was not inconsistent with policy innovation. Rather more adventurously, Don Dunstan’s South Australian Labor governments of the late 1960s and especially the 1970s, provided a blueprint for the social progressivism associated with the Whitlam revolution. Dick Hamer’s progressive Liberal government in Victoria complemented the Whitlam agenda.

South Australian premier Don Dunstan lead a socially progressive government associated with the Whitlam revolution.
The Centre of Democracy, South Australia

The 1980s revealed some of the limits for state governments in economic policy. The Victorian Cain Labor Government’s economic interventionism won the active dislike of Bob Hawke and Paul Keating. It ran up against the barrier of national economic policy and, eventually, political turmoil and financial scandal. Other governments were dogged either by corruption, as in the case of Western Australia and Queensland, or financial mismanagement, as in South Australia.

These results pushed the following generation of Labor leaders and governments towards notable caution and probity. By the mid-2000s, the credit ratings agencies were taking on the role of de facto third chamber of the state legislatures.

Still, the Bracks Labor government in Victoria sought to use its personnel and resources to influence the national policy debate. It contributed a National Innovation Agenda, which the Rudd Government took up as a starting point for its own efforts in that field.

The nature of the compact John Howard formulated to get his Goods and Services Tax up, which saw revenue going to the states according to an agreed formula, also provides premiers with a captive national audience whenever the issue of tax policy reform arises.




Read more:
From ‘Toby Tosspot’ to ‘Mr Harbourside Mansion’, personal insults are an Australian tradition


Where does this leave state government today? In the first place, it shares with federal government control over areas that are among the most controversial and difficult for government. Energy policy is near the top of the list. And no one would regard Victoria’s new euthanasia law as anything other than a matter of high seriousness.

State government’s capacity for innovation and experimentation in fields that matter, and are not dependent on federal control of the purse-strings, remains alive. The Council of Australia Governments, or COAG, offers a forum in which such influence can be exercised. State governments in Victoria and South Australia have been pursuing the idea of a Treaty with Indigenous people, at a time when the issues of constitutional recognition, an Indigenous voice to parliament, and a Treaty or Makarrata have stalled at the national level. At the territory level, it was the ACT government that passed Australia’s first bill of rights law in 2004.

State governments provide Australians with choice and a government that, for most people, will be less physically and spiritually distant from their daily lives than Canberra. There are also the benefits of variety. For some years during the time John Howard was dominating the federal scene, every state and territory government was controlled by Labor.

Today, there is a more even division between the parties. It remains true, however, that in a time of disillusionment and distrust of politicians, state government provides electoral choice, checks on federal government power, and a large array of the services that Australians think of as peculiarly the province of government.The Conversation

Frank Bongiorno, Professor of History, ANU College of Arts and Social Sciences, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Australia and China push the ‘reset’ button on an important relationship


Tony Walker, La Trobe University

Australia can thank an erratic Donald Trump for the opportunity to “reset” its relationship with China after a chill engendered by what was interpreted as criticism from the then prime minister, Malcolm Turnbull, and foreign minister, Julie Bishop.

Turnbull had caused offence with his criticism of Chinese interference in Australian politics via Beijing’s front organisations. And in March 2017, Bishop had questioned China’s political model in a speech in Singapore.

A reset was already in the works before Turnbull was felled in August in a palace coup. The two countries had been reassessing shared interests in light of the wrecking ball US President Trump has taken to an international rules-based system.




Read more:
Morrison and Shorten reveal their positions on key foreign policy questions


Former treasurer and new Prime Minister Scott Morrison’s elevation of Marise Payne to replace Bishop provided a pretext for an important diplomatic engagement in Beijing in the lead-up to what is being called the “summit season”.

This interaction may well have happened anyway, but a changing of the guard in Canberra helped get over any “face issues” that might have lingered after fairly trenchant criticism of Australia in Chinese official mouthpiece publications.

Payne’s arrival in the Chinese capital ahead of an East Asia Summit in Singapore, an Asia Pacific Economic Cooperation (APEC) forum in Port Moresby, and a G20 summit in Buenos Aires this month is not a coincidence.

Her presence in Beijing for the fifth Australia-China Foreign and Strategic Dialogue is the first visit by an Australian foreign minister in nearly three years.

After putting Australia in the freezer, Beijing has enabled a thaw ahead of these important events at which America’s behaviour will be under scrutiny, if not censure.

Beijing’s emollient words at a meeting between Foreign Minister Wang Yi and Payne could have hardly contrasted more sharply with criticism expressed over the past several years as debate about foreign interference disrupted the relationship.

This is what Wang had to say about a reset:

We are ready to step up our strategic dialogue and deepen strategic cooperation … in particular, rebuild and cement our political mutual trust.

These are Chinese diplomatic buzzwords, with an emphasis on “mutual trust”.

Payne described her two hours of talks – which ran overtime – as a “full and candid discussion”. Australia and China had agreed on a “respectful relationship”.

Pointedly, Wang had referred to a “new government” in Canberra, as if to say that a change of management had enabled a thaw.




Read more:
The risks of a new Cold War between the US and China are real: here’s why


China’s conduct of its foreign policy, in which it alternately rewards and penalises those who fall out of favour, in some ways resembles a Beijing opera.

Melodrama is intrinsic to this Chinese art form.

China’s invitation to Payne for a long-delayed strategic dialogue is a calculated diplomatic move. It’s one that also suits Australia, anxious to gets its diplomatic relationship with China back on track.

It is in neither country’s interests – certainly not Australia’s – for an estrangement to persist at a time when uncertainty prevails due to an unpredictable American presidency.

Concerns in Beijing and Canberra about preserving open markets when American protectionism is threatening a liberalising trading environment have prompted this reset and determined its timing.

Beyond that, Canberra appears to have resolved that Australia’s interests are not well served by allowing an Australian security establishment possessed of a certain anti-China mindset to tilt policy in directions that do not serve the national interest.

It is one thing to exhibit scepticism about China’s behaviour and motivations. It is quite another to allow a “reds under the bed” mentality to drive policy.

No-one with more than passing knowledge believes China is a benign power. But nor is it the enemy. Its rise is a fact of life, whether Australian policymakers in thrall to a security establishment like it or not.

Interestingly, China sought to allay Australia’s concerns about its push into the southwest Pacific by offering “trilateral cooperation” in assisting Pacific island states build their infrastructure.

How this would work practically is not clear. But Wang appeared to be suggesting that Australia’s newly announced infrastructure fund for the Pacific could participate in joint projects with China’s Belt and Road Initiative.

Australia and China are not competitors, not rivals but cooperation partners, and we have agreed to combine and capitalise on our respective strengths to carry out trilateral cooperation involving Pacific Island states.

Significantly, Australia’s announcement on the eve of the Wang-Payne meeting that Canberra was blocking the takeover of the APA Group by Hong Kong’s CK Group on competition grounds was not an impediment to improving ties.

Pragmatism prevailed. “We hope a single case won’t affect Australia’s attitude to investment,” Wang said.

Payne’s visit took place against the background of overtures to China begun by Turnbull and Bishop in their efforts to restore certainty to the relationship.

A speech by Morrison to the Asia Society last week, in which he spoke of the importance of the Australia-China relationship, provided further impetus for a reset, propelled to a certain extent by Washington.The Conversation

Tony Walker, Adjunct Professor, School of Communications, La Trobe University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

How to restore trust in governments and institutions



File 20181108 74763 tnwgy2.jpg?ixlib=rb 1.1
It takes collective action to deal with global issues.
from http://www.shutterstock.com, CC BY-ND

Grant Duncan, Massey University

Addressing the UN General Assembly in September, UN Secretary-General Antonio Guterres warned that the world is “suffering from a bad case of trust deficit disorder”.

Trust is at a breaking point. Trust in national institutions. Trust among states. Trust in the rules-based global order. Within countries, people are losing faith in political establishments, polarization is on the rise and populism is on the march.

Yet, it takes global collective action, and hence trust, to prevent proliferation of nuclear weapons, address climate change and uphold human rights. It takes trust across political parties and across generations to create a durable consensus to reduce economic inequality and poverty.




Read more:
If politicians want more trust from voters, they need to start behaving with civility and respect


Decline in trust

Surveys of people’s trust in politicians and governments generally show a long-term decline, especially in the United States which has surveys dating back to 1958. As President Trump thrives on distrust, this trend is unlikely to reverse anytime soon.

Decline of trust is not uniform in all democracies, but, if you ask people whether they trust politicians, the answer is likely to be negative, even in countries like Norway. Furthermore, voter turnouts are in decline – another symptom of distrust. But, if we lack political trust, then we lack the foundation on which to negotiate collectively any sustainable solutions to the world’s most urgent problems.

In western political thought, trust is traditionally seen in two closely related dimensions. In John Locke’s version, trust is a gift from the people to those who rule, conditional upon powers being used for the people’s security and safety. In John Stuart Mill’s version, the elected representative is regarded as a trustee who acts on voters’ behalf rather than a delegate acting only at our behest.

Room for scepticism

In general, people who vote are more likely to express higher levels of trust in politicians and in government. But some may vote in order to defeat a candidate or party regarded as untrustworthy (on an “anyone but” basis) while others may not bother voting because they are highly, if not naively, trusting.

In any political system, it is not prudent to trust completely, however. We have constitutional checks and balances precisely because we trust no one at all with absolute and unaccountable powers. In a democracy, whether one votes or not, we have little choice but to entrust a relatively small number of representatives with powers to pass laws and to govern, but we are not called on to abandon scepticism or to have blind faith.

The big issue, though, is how to develop greater trustworthiness in the individuals whom we do elect, and how to build greater popular trust in decision-making systems, even when we disagree openly and strongly over particular concerns.

Trust in politics

Trust is not a thing that one can literally build, break and then rebuild. Political leaders cannot simply approve a policy and a budget to rebuild trust in the way that we rebuild worn-out infrastructure.

If we demand trust from people, they are likely to react with scepticism. Sledge Hammer’s famous “Trust me, I know what I’m doing” was funny for good reason.

Political and economic systems that are “rigged” (when they produce unfair outcomes or are downright corrupt) are unlikely to be trusted, moreover. Many people in affluent countries are finding that hard work for long hours is not providing a standard of living sufficient to achieve reasonable life goals.

Electoral systems often deliver disproportionate results. Politicians attack one another for short-term gain rather than work for the good of the country. Reducing economic inequality and reforming electoral systems or campaign finance laws may help to address the problem of political trust.




Read more:
New Zealand politics: how political donations could be reformed to reduce potential influence


What to do

But there is a deeper “bootstraps” problem, as it takes political trust to gain the consensus to take the actions needed for such significant reforms. It takes trust to build trust. It would be morally unacceptable, however, to give up on the project of restoring political trust on the grounds that it’s too hard.

We need first to understand clearly the kinds of actions entailed in trustworthy conduct – for example, abstaining from taking advantage of the vulnerable, paying heed to people’s complaints, promising no more than one can deliver. If we adopt these characteristics in our own behaviour, then we are in a much better position to expect them of others.

Beyond individual conduct, we need to examine carefully our economic and political systems. The world will never be perceived by all as completely fair. But the difficult task of restoring political trust is inextricably entwined with the tasks of critically reflecting on our own behaviour as leaders in our communities and then working for significant reforms to social and economic policies and electoral systems.The Conversation

Grant Duncan, Associate Professor for the School of People, Environment and Planning, Massey University

This article is republished from The Conversation under a Creative Commons license. Read the original article.