Ideas@TheCentre – The Centre for Independent Studies


Ideas@TheCentre brings you ammunition for conversations around the table.  3 short articles from CIS researchers emailed every Friday on the issues of the week.

Muddled welfare debate

Jeremy Sammut

28 October 2016 | Ideas@TheCentre

welfare unemployment dole (002)According to Human Services Minister Alan Tudge, more than 400,000 unemployed people receiving Newstart Allowance are not subject to any work-related mutual obligations to be actively looking for a job. And, besides, only 4% of those who breach their obligations receive a penalty.

Tudge argued this showed that the problem of long-term unemployment was due to the “poverty of low expectations” engrained in the welfare system.

The other — less PC explanation — is that the welfare system is actually too generous.

The unemployed can live relatively well on the dole in combination with the multitude of supplementary benefits available; it is not worth getting a job which in all likelihood will only marginally increase their income relative to the effort involved.

A welfare system that lets loafers stay on the dole is deeply immoral: it’s especially unfair to those who do the right thing and work in low-paid occupations.

Yet the debate about the welfare system is often muddled because we fail to make moral judgements about who is and isn’t deserving.

The former head of the Abbott Government’s Commission of Audit, businessman Tony Shepherd, recently argued the problem is bigger than “surfing dole bludgers”; the “inconvenient truth” is that Australia is a “nation of mendicants” because “half the population gets some form of Commonwealth handout.”

Yet it is absurd to draw moral equivalence between loafers and working families receiving family tax benefits.

In the first place, horizontal equity is as real as vertical equity, and there are good social reasons for families with dependent children to have higher household incomes than the childless (such as myself).

In the second place, labelling family payments as welfare dependence akin to dole-bludging is NOT the way to sell the message of budget repair.

Telling people who are struggling to pay off mortgages, afford child care, and juggle work and family in our congested major cities that they are not entitled to a portion of their taxes back to help raise their kids will win few converts to the cause of smaller government in middle Australia.

In defence of millennials

Trisha Jha

28 October 2016 | Ideas@TheCentre

millennials avocadoI’m under no illusions about the CIS demographic, so I know this is a provocative topic for this newsletter. After all, aren’t millennials busy complaining about house prices in one breath and bemoaning developers in the next — in between mouthfuls of smashed avocado on toast?

Well, no. Some of us are busy dragging government into the twenty-first century. CIS was joined this week by the NSW Finance Minister Dominic Perrottet, who is perhaps unusual among cabinet ministers in that he openly refers to himself as a millennial, rather than frantically editing his Wikipedia page lest anyone find out he was, in fact, born in 1983.

Mr Perrottet has a relatively high opinion of his fellow millennials, pointing out in his CIS speech on Tuesday that they are the strongest supporters of projects such as asset recycling, where an old and unproductive asset owned by the government can be sold and the proceeds dedicated to building new infrastructure.

This is not really surprising. After all, younger generations are more liberally minded — one poll suggested those over 55 are the most likely to oppose investment by Chinese companies. I’ve got a hunch this follows for other key measures of economic openness, such as free trade, and immigration and population.

Furthermore, young people are the early adopters when it comes to new technologies and services — like Uber and Airbnb — that disrupt the carefully-engineered sweetheart deals between government and industry. They are also at the forefront of establishing start-up companies providing fresh competition to stale industries that haven’t changed shape for the past 50 years, such as real estate.

There are whingers and cribbers in every generation. But we have very good reasons to think that new technology, with its ability to carry information farther and wider, can reinvigorate the market and serve as a challenge to the role of the state in people’s lives. If that happens, millennials can say: “you’re welcome.”

Expanding our tribe

Simon Cowan

28 October 2016 | Ideas@TheCentre

tribe lego people superheroesNot long after the release of an explosive recording of Donald Trump making crude comments about women, a polling website published a blog post detailing how the US electoral map would look if only women or men voted (Clinton wins 458 female electoral votes to 80 while Trump wins 350 male electoral votes to 188).

A similar picture has been circulating social media, suggesting that if the vote was restricted to people of colour, or white people with college degrees, the Democrats would be overwhelming winners, while if the election were up to non-college educated white folks the Republicans would walk in.

Of course the US system is polarised in a way that the Australian system isn’t: compulsory voting combined with a senate much more accessible for non-major parties makes a difference. The US has whole states that are traditionally safe Republican or Democrat the way Australia has individual seats that are safe Labor or safe Liberal.

However it’s likely that the same underlying factors driving the divergence in US voting patterns between genders, races and locations also exist in Australia.

One troubling factor is that, far from expanding our exposure to contrary and difficult opinions, the explosion of news and information available online may have had the opposite effect. Where once, due to geography and circumstance, we may have had to interact with those in different circumstances who hold different views, online we can curate a group of like-minded people.

Another manifestation of this is the desire to create safe spaces (both online and especially at university) where dissenting voices are not refuted but silenced.

This is not exclusively a problem of the left either; witness the speed at which defenders of Donald Trump countered the release of the tape mentioned above with attacks directed at the Clinton campaign.

For those of us who want to shrink government, this is a real challenge and there is no easy answer.

At least the first step is in our control: read widely. Read Chris Kenny and Paul Kelly in the Australian but read Bernard Keane in Crikey and Sean Kelly in the Monthly too. Take in the thoughts of Peter Costello and Kristina Keneally. Try to understand viewpoints that challenge your beliefs and articulate your opposition to them, don’t just mock them.

After all, our group isn’t big enough to cover the electoral map on our own.