Watch David Hetherington exec director PerCapita on The Drum ABC 24 22/06/11 http://www.abc.net.au/iview/#/view/788652 (expires 2/7/11 days)
Watch Tim Soutphommasane of PerCapita on The Drum ABC 24 23/06/11 http://www.abc.net.au/iview/#/view/788655 (expires 3/7/11 days)
Saturday, June 25, 2011
Thursday, June 23, 2011
Tim Soutphommasane appears on ABC24's THE DRUM
Per Capita’s Tim Soutphommasane will be appearing on THE DRUM, ABC24, tonight at 6.05pm Thursday 23 June 2011.
ENERGY MATTERS VIDEO NEWS
Energy Matters V-News reports on David Hetherington's recent AFR op-ed "Solar yield beats BHP any time."
Tuesday, June 21, 2011
David Hetherington on Life Matters today
David Hetherington, Per Capita’s Executive Director, will be appearing on
Radio National, Life Matters, at 9.05am this morning Tuesday 21 June 2011.
Radio National, Life Matters, at 9.05am this morning Tuesday 21 June 2011.
Thursday, June 16, 2011
Solar yield beats BHP any time
Per Capita’s David Hetherington writes in today’s AFR. "Forget the blue-chip shares, opt instead for the sun’s rays. It’s a far better deal." p59 http://bit.ly/khD4ng (subscription required).
Unedited version:
Is Ross Garnaut right to suggest that big business in Australia is anti-reform? Are we foregoing innovation opportunities because business has “returned to old type” of the pre-reform era?
Let’s test the proposition on one proposed innovation which holds iconic status in the battle between skeptics and Greens: solar power. Writing in the Herald Sun this week, Andrew Bolt decries the appeal to solar, observing pithily that solar power stops when the sun don’t shine.
Yet what if innovation can detach solar from its reliance on green credentials? If you look at solar power from entirely another perspective it makes enormous financial sense for a growing part of our population, independent of its sustainability.
For emerging ‘solar plus storage’ technologies for homes and small businesses offer a new investment class that is more profitable than BHP Billiton shares and safer than bank shares. Tosh? Let’s see.
The first great law of technological change is that the existing players, no matter how big, how successful, universally fail to make the change to new disruptive technologies. Flown on a Cunard airliner lately? Booted up your RCA Victor computer? Used a Bell mobile phone?
At the moment we see newspapers and recording industries being undermined by the Internet. In the past railways and steamships yielded to aeroplanes and cars. It will happen in the electricity industry too, no matter how many times they are warned they will still be shocked to discover their bread and butter business is disappearing, just like the traditional telcos were shocked when punters abandoned land lines.
When you buy electricity for your home it costs around 23 to 27 cents per kilowatt hour plus supply charges. But the wholesale price of power at the power station is only around 3.3 cents. So the distribution increases the cost 800% or more. So the problem is not one of supply but distribution. And most of the money needed for the power industry in the next 10 year is not for generation, it is for wires.
Even Mr Bolt would agree that large bits of Australia are very sunny. In many locations, the cost of carbon-neutral solar power from the sun, falling on the roof of an Australian home is cheaper than electricity coming down the wire. This is because the price of solar panels and storage batteries are falling rapidly in part due to technology, but also increased supply and lastly, the exchange rate. It just depends on how you look at the cost.
Consider what Australian investors need over the next 20 years. The post-war baby boom and the superannuation industry mean that an enormous number of Australians are already, or will become, self funded retirees in the next 10 years. What they need are safe, high yielding, stable, inflation-proof investments.
If you buy property you have to face the prospect that Australia's property market is unlikely to continue to grow at its recent rate. On present indications, it might even fall. So too it is unlikely BHP will always enjoy such halcyon commodity prices and terms of trade. The Chinese aren't franticly building mines in darkest Africa for no reason. One thing we can say for certain is that power prices are going to rise. The other great certainty is tax.
So our self-funded retiree has to invest their lump sum and first pay tax on the dividends, then pay their power bills. If your power bills are $1,000 a year and you pay them with after-tax money earned from BHP dividends today you need $47,000 of BHP shares just to pay your power bill. And if the price of iron ore in China falls (not something you have a lot of control over) you will need even more shares to pay the bills. Investment property returns are not much better.
So it seems to Per Capita a sensible option is to take some of this lump sum and invest instead in solar panels, whack them on your roof (a place over which you do have some control) and put a battery in your garage.
Two kilowatts of solar panels on your roof in the most parts of Australia will make $1,000 of power a year. These 2KW panels cost a lot less than $47,000 of BHP shares - and when the price of iron ore falls in China, you don't care. When the price of conventional power rises due to inflation (and it is predicted to skyrocket), you still don't care.
For the sake of argument let’s say you can install 2kw panels with batteries for $15,000.
So an investment of $15,000 will save you $1,000 of power bills per year. This is a 6.7% return, but you don't pay tax on savings so would need to earn 9.5% on shares or rental property to match this rate (if you are paying 30% tax)
To match this your BHP shares would also have to yield 9.5% (instead of 3.0%), with dividends increasing at the same rate as electricity prices. That’s not going to happen.
These calculations assume no bounties, no feed-tariffs, nothing. If these extras are available, they simply make the economics better.
And happily, all this saves the planet since solar power is essentially free of carbon emissions.
It begins to look like you can have your can have your cake and eat it too.
This kind of direct action has three huge benefits: it reduces household Co2 emissions to nearly zero at zero cost; it takes load off the grid, so saves the nation money; and it future-proofs one small aspect of retirement. It just needs an innovative approach to market design and secured financing that seems beyond some of today’s business leaders.
Unedited version:
Is Ross Garnaut right to suggest that big business in Australia is anti-reform? Are we foregoing innovation opportunities because business has “returned to old type” of the pre-reform era?
Let’s test the proposition on one proposed innovation which holds iconic status in the battle between skeptics and Greens: solar power. Writing in the Herald Sun this week, Andrew Bolt decries the appeal to solar, observing pithily that solar power stops when the sun don’t shine.
Yet what if innovation can detach solar from its reliance on green credentials? If you look at solar power from entirely another perspective it makes enormous financial sense for a growing part of our population, independent of its sustainability.
For emerging ‘solar plus storage’ technologies for homes and small businesses offer a new investment class that is more profitable than BHP Billiton shares and safer than bank shares. Tosh? Let’s see.
The first great law of technological change is that the existing players, no matter how big, how successful, universally fail to make the change to new disruptive technologies. Flown on a Cunard airliner lately? Booted up your RCA Victor computer? Used a Bell mobile phone?
At the moment we see newspapers and recording industries being undermined by the Internet. In the past railways and steamships yielded to aeroplanes and cars. It will happen in the electricity industry too, no matter how many times they are warned they will still be shocked to discover their bread and butter business is disappearing, just like the traditional telcos were shocked when punters abandoned land lines.
When you buy electricity for your home it costs around 23 to 27 cents per kilowatt hour plus supply charges. But the wholesale price of power at the power station is only around 3.3 cents. So the distribution increases the cost 800% or more. So the problem is not one of supply but distribution. And most of the money needed for the power industry in the next 10 year is not for generation, it is for wires.
Even Mr Bolt would agree that large bits of Australia are very sunny. In many locations, the cost of carbon-neutral solar power from the sun, falling on the roof of an Australian home is cheaper than electricity coming down the wire. This is because the price of solar panels and storage batteries are falling rapidly in part due to technology, but also increased supply and lastly, the exchange rate. It just depends on how you look at the cost.
Consider what Australian investors need over the next 20 years. The post-war baby boom and the superannuation industry mean that an enormous number of Australians are already, or will become, self funded retirees in the next 10 years. What they need are safe, high yielding, stable, inflation-proof investments.
If you buy property you have to face the prospect that Australia's property market is unlikely to continue to grow at its recent rate. On present indications, it might even fall. So too it is unlikely BHP will always enjoy such halcyon commodity prices and terms of trade. The Chinese aren't franticly building mines in darkest Africa for no reason. One thing we can say for certain is that power prices are going to rise. The other great certainty is tax.
So our self-funded retiree has to invest their lump sum and first pay tax on the dividends, then pay their power bills. If your power bills are $1,000 a year and you pay them with after-tax money earned from BHP dividends today you need $47,000 of BHP shares just to pay your power bill. And if the price of iron ore in China falls (not something you have a lot of control over) you will need even more shares to pay the bills. Investment property returns are not much better.
So it seems to Per Capita a sensible option is to take some of this lump sum and invest instead in solar panels, whack them on your roof (a place over which you do have some control) and put a battery in your garage.
Two kilowatts of solar panels on your roof in the most parts of Australia will make $1,000 of power a year. These 2KW panels cost a lot less than $47,000 of BHP shares - and when the price of iron ore falls in China, you don't care. When the price of conventional power rises due to inflation (and it is predicted to skyrocket), you still don't care.
For the sake of argument let’s say you can install 2kw panels with batteries for $15,000.
So an investment of $15,000 will save you $1,000 of power bills per year. This is a 6.7% return, but you don't pay tax on savings so would need to earn 9.5% on shares or rental property to match this rate (if you are paying 30% tax)
To match this your BHP shares would also have to yield 9.5% (instead of 3.0%), with dividends increasing at the same rate as electricity prices. That’s not going to happen.
These calculations assume no bounties, no feed-tariffs, nothing. If these extras are available, they simply make the economics better.
And happily, all this saves the planet since solar power is essentially free of carbon emissions.
It begins to look like you can have your can have your cake and eat it too.
This kind of direct action has three huge benefits: it reduces household Co2 emissions to nearly zero at zero cost; it takes load off the grid, so saves the nation money; and it future-proofs one small aspect of retirement. It just needs an innovative approach to market design and secured financing that seems beyond some of today’s business leaders.
Friday, June 10, 2011
The paradox of prosperity
David Hetherington
Despite the booming economy, most Australians aren’t feeling so positive about Labor's recent spate of progressive political reforms
At the recent Progressive Governance conference in Oslo, Norwegian Prime Minister Jens Stoltenberg’s concluding remarks brought a wry smile to the faces of the Australian delegates. Pressed on challenges of a green economy, Stoltenberg said: “It’s quite simple, really - you adopt the ‘polluter pays’ principle and put a price on carbon.”
If only it were so easy in Australia. Putting a price on carbon remains an existential challenge for Julia Gillard’s Labor Government. While the government remains resolute in its commitment to carbon pricing, it is under siege from big business and the conservative media, and is foundering in the opinion polls.
Read full story here
Despite the booming economy, most Australians aren’t feeling so positive about Labor's recent spate of progressive political reforms
At the recent Progressive Governance conference in Oslo, Norwegian Prime Minister Jens Stoltenberg’s concluding remarks brought a wry smile to the faces of the Australian delegates. Pressed on challenges of a green economy, Stoltenberg said: “It’s quite simple, really - you adopt the ‘polluter pays’ principle and put a price on carbon.”
If only it were so easy in Australia. Putting a price on carbon remains an existential challenge for Julia Gillard’s Labor Government. While the government remains resolute in its commitment to carbon pricing, it is under siege from big business and the conservative media, and is foundering in the opinion polls.
Read full story here
Monday, June 6, 2011
David Hetherington to appear on ABC24 The Drum 06/06/11 6:05pm
David Hetherington, Per Capita’s Executive Director, will be appearing on ABC24, The Drum, at 6pm tonight, Monday 6 June 2011.
Wednesday, June 1, 2011
Karl Bitar's leap to Crown Casino
by David Hetherington
It’s hard to know whether to laugh or cry at the news that former Labor boss Karl Bitar is joining Crown Casino. The scriptwriters at the Simpsons couldn’t have cast a more delicious storyline, but at the same time it simply cements the public’s rock-bottom perception of politics and its practitioners.
... In some sections of corporate Australia, it’s assumed that anything which threatens a company’s quarterly earnings is by extension a cancer on our body politic. Over the last year alone, a host of policy proposals have attracted organised corporate resistance: the resource rent tax, banking competition, pokies reform, MySuper, cigarette advertising and, not least, a carbon price. An American CEO is famously misquoted as saying in the 1950s that “what‘s good for General Motors is good for the country”. In the last few months, we might have rephrased this to say: “If it’s bad for BlueScope or Rio or British American Tobacco, it’s bad for Australia.”
To read full article link here.
It’s hard to know whether to laugh or cry at the news that former Labor boss Karl Bitar is joining Crown Casino. The scriptwriters at the Simpsons couldn’t have cast a more delicious storyline, but at the same time it simply cements the public’s rock-bottom perception of politics and its practitioners.
... In some sections of corporate Australia, it’s assumed that anything which threatens a company’s quarterly earnings is by extension a cancer on our body politic. Over the last year alone, a host of policy proposals have attracted organised corporate resistance: the resource rent tax, banking competition, pokies reform, MySuper, cigarette advertising and, not least, a carbon price. An American CEO is famously misquoted as saying in the 1950s that “what‘s good for General Motors is good for the country”. In the last few months, we might have rephrased this to say: “If it’s bad for BlueScope or Rio or British American Tobacco, it’s bad for Australia.”
To read full article link here.
Wayne Swan, The Story Behind the Budget Part Three - Spreading Opportunity, Melbourne, 17/05/03
Wayne Swan addresses PerCapita Luncheon: The Story Behind the Budget Part Three - Spreading Opportunity.
Wayne Swan praises PerCapita as one of the "most important think tanks we have in this country".
Video 1
Link to YouTube 1/2: http://www.youtube.com/watch?v=C87WYEy5Q6k&feature=player_profilepage
Video 2
Link to YouTube 2/2: http://www.youtube.com/watch?v=5jNpeipqa5U&feature=player_profilepage
Link to transcript: http://bit.ly/jmqLX1
Wayne Swan praises PerCapita as one of the "most important think tanks we have in this country".
Video 1
Link to YouTube 1/2: http://www.youtube.com/watch?v=C87WYEy5Q6k&feature=player_profilepage
Video 2
Link to YouTube 2/2: http://www.youtube.com/watch?v=5jNpeipqa5U&feature=player_profilepage
Link to transcript: http://bit.ly/jmqLX1
Penny Wong speaks at PerCapita public forum, Melbourne 03/05/11
Penny Wong speaks at PerCapita public forum in Melbourne on 03/05/11,
The 2011 Budget and the return to surplus - Link to transcript: http://bit.ly/jkfIJG
Introduction by PerCapita Executive Director, David Hetherington.
Video 1
Link to YouTube - 1/2: http://www.youtube.com/watch?v=Z7b0PY-kD7M
Video 2
Link to YouTube - part 2/2: http://www.youtube.com/watch?v=iZZWS4N1vzk
The 2011 Budget and the return to surplus - Link to transcript: http://bit.ly/jkfIJG
Introduction by PerCapita Executive Director, David Hetherington.
Video 1
Link to YouTube - 1/2: http://www.youtube.com/watch?v=Z7b0PY-kD7M
Video 2
Link to YouTube - part 2/2: http://www.youtube.com/watch?v=iZZWS4N1vzk
Friday, May 27, 2011
Cost of living crisis? Life in Australia is better than ever
Check out PerCapita's Rupert Denton excellent piece on The Drum: Cost of living crisis? Life in Australia is better than ever. Link here for the full article
Wednesday, May 18, 2011
Swan among sympathisers
Today the Australian Financial Review writes on p46: After the hammering he’s been getting around the country spruiking the budget, Wayne Swan was happy to be among friends in Melbourne yesterday. Wayne Swan was the star attraction at a lunch put on by PerCapita. Link: http://bit.ly/jbGy4C (subscription required)
Tuesday, May 17, 2011
The Story Behind the Budget Part Three: Spreading Opportunity
Transcript of the address to Per Capita by the Treasurer, the Hon Wayne Swan MP, in Melbourne today http://bit.ly/jmqLX1
Middle class welfare: not happy Julia
Chris Berg writes on The Drum “Perhaps families earning $150,000 a year are “rich”. Perhaps they’re not. But it’s intuitively obvious they shouldn’t receive welfare”. He goes on to say “In the Weekend Australian (Open the public purse to meet need, not greed - http://bit.ly/lDBNBe), Tim Soutphommasane (of the progressive think tank Per Capita) said “Any fair and efficient system of welfare … should be guided by a principle of need.” To read the full article, link here: http://bit.ly/k1DRo9
Open the public purse to meet need, not greed
Tim Soutphommasane writes in the Weekend Australian “Should a household with an income of $150,000 consider itself to be rich? THE treasurers and finance ministers of the world know better than anyone the iron laws of fiscal politics: there is nothing easier than promising an extra share of the public booty and nothing more difficult than raising taxes. ... Any fair and efficient system of welfare, ..., should be guided by a principle of need. The government simply cannot support everyone. ... Those aspiring to a life of plasma screen televisions, posh European cars and private schooling for their children shouldn't be crying poor. They certainly shouldn't be looking for largesse from the public treasury. If they are doing it tough, they should have more realistic expectations about what it means to live well.
To read the full post, link here: http://bit.ly/lDBNBe
To read the full post, link here: http://bit.ly/lDBNBe
Wednesday, May 11, 2011
PerCapita hosts Treasurer's post-budget address and luncheon, 17 May 2011
The Hon. Wayne Swan MP, Federal Treasurer, will deliver a Post-Budget Address to the Melbourne business community, highlighting the challenges and opportunities in the 2011-2012 Federal Budget, and how it will impact corporate Australia.
Please join us for lunch to hear the Treasurer deliver the first public post-Budget Address in Melbourne.
Date: Tuesday 17 May 2011, 12.30pm.
Venue: Swanston Room, Melbourne Town Hall, Corner Swanston and Collins Streets, Melbourne
Tickets: $2,700 + GST for a table of ten ($270 + GST individual tickets)
$1,350 + GST for non-profit organisations
For further information or to book tickets, please visit our website or contact Allison Orr on 0423 602 771 or a.orr@percapita.org.au
Please join us for lunch to hear the Treasurer deliver the first public post-Budget Address in Melbourne.
Date: Tuesday 17 May 2011, 12.30pm.
Venue: Swanston Room, Melbourne Town Hall, Corner Swanston and Collins Streets, Melbourne
Tickets: $2,700 + GST for a table of ten ($270 + GST individual tickets)
$1,350 + GST for non-profit organisations
For further information or to book tickets, please visit our website or contact Allison Orr on 0423 602 771 or a.orr@percapita.org.au
Tuesday, May 10, 2011
Monday, May 9, 2011
Wednesday, May 4, 2011
Marcus Priest writes about PerCapita Forum in today's Australian Financial Review
In today's Australian Financial Review (p5) Marcus Priest notes that speaking at a forum organised by the left-wing think-tank Per Capita "Finance Minister Penny Wong has warned that spending cuts in the budget were needed to avoid a higher tax burden on future generations."
To read the transcript link here: http://bit.ly/jkfIJG
To read the transcript link here: http://bit.ly/jkfIJG
PER CAPITA PUBLIC FORUM MELBOURNE TOWN HALL MELBOURNE THE 2011 BUDGET AND THE RETURN TO SURPLUS
The following information was released by the office of the Minister for Finance and Administration of Australia:
It is a pleasure to be speaking here today for Per Capita, an organisation that makes an invaluable, although occasionally lonely, progressive contribution to public policy and discourse.
In the descriptor of the Per Capita story, the rationale for its establishment includes the presentation of the “economic and moral cases for progressive policy reform in Australia”; a focus on the long term and the avoidance of both old and false debates.
Today I want to speak to you about the values underpinning the Budget and the economic circumstances in which it has been put together.
In this context I want to focus on the progressive case for returning the Budget to surplus, why it is in our collective long term interests; and why some of the avowedly left arguments for not doing so are part of a debate which is both old and false.
Budgets are not just an exercise in accounting; budgets reflect the values and beliefs of governments.
They are not an end in and of themselves.
They are the means by which governments deliver on their priorities.
For a Labor Government, a Budget is not just about numbers, it’s about people.
The coming Budget is framed by the need to deliver strong and progressive outcomes for this generation, and the next.
It will deliver on Labor’s tradition of fairness and our recognition that equality demands opportunity.
It will reflect our belief that a strong economy is the foundation of prosperity and fairness. That prosperity must be created to be shared.
It will enhance opportunities for those in work and remove barriers to those who are not.
It will ensure that the right supports are in place for the transition from education to employment.
The Budget will also confirm the Government’s fiscal strategy, and the pathway for returning the Budget to surplus in 2012-13.
This strategy is driven by an understanding of the consequences of failing to take responsibility on fiscal matters, both for the next few years, but also beyond.
It’s driven by an understanding of the challenges that come with the mining boom and the importance of spreading its benefits as far and wide as possible.
And it’s driven by an understanding that we must look not only to our own interests but also to the next generation’s.
We know that unsustainable spending is neither responsible nor progressive – and we know that it imposes very real consequences on our children.
The Challenge
The current economic environment presents a unique set of challenges.
It can be easy to forget the economic destruction Australia avoided due to the Government’s swift response to the global financial crisis (GFC).
The current situation in most OECD nations shows what happens when countries feel the full brunt of a financial crisis.
A recession was averted by the actions of this Labor Government.
But the effects of the GFC can still be seen in the Commonwealth Budget – although stimulus spending has wound down, revenues are lagging as companies carry forward losses and consumer sentiment is still hesitant.
The GFC was a shock to the Australian economy, and to Australians.
Consumers have responded to that shock by being cautious - paying off credit cards rather than shopping, paying down their mortgages rather than going on holidays.
In addition, the impact of the Queensland and Victorian floods and Cyclone Yasi are having a significant impact on the economy in the short term, and therefore Government revenues.
Yet these short term factors will not knock Australia off its growth trajectory.
The coming record investments in the mining and resource sectors, the best terms of trade in living memory and low unemployment will see surging growth in some sectors of the economy.
As this boom gathers pace, it will exacerbate capacity constraints and further the pressures on the patchwork economy.
Without the right policy response, this wave of investment risks increasing price pressures across the economy.
Different approach?
In facing these challenges some have called on the Government to put aside its commitment to return the Budget to surplus and allow one, two, three years or more years of deficits.
We see this call particularly from some on the left, who characterise the Government’s budget strategy as an unnecessary discipline.
But consider the consequences of this course of action.
What would be the impact of not returning to surplus in 2012-13?
In the year we will return to surplus:
the mineral sector will be booming as today’s round of investments come online, exacerbating capacity constraints and pressures on the patchwork economy;
growth will be strong and above trend; and with
an unemployment rate with four in front of it.
To not have the Budget in surplus in 2012-13 would see the Government competing with the private sector for the same resources.
Restraining spending and building surpluses means we’re not compounding inflation and cost of living pressures in the years ahead.
To do otherwise would disproportionately hit those least able to adapt, those in low paying jobs, and those on fixed incomes including students and the elderly.
It would erode incomes, putting pressure on the cost of living and additional stress on household budgets.
It would aggravate the challenges of the patchwork economy, as the cost of inputs rise, putting job creation in some sectors at risk.
As the boom surges the pressures on manufacturing, services and non-mining sectors will increase, as it draws in resources and workers.
Delaying the return to surplus can also impact the longer term sustainability of the Budget – forcing us to make harder decisions in the future.
Because we need to remember that a decision today can close off a more worthy decision tomorrow.
The Government’s response
So the Government will do what is responsible.
The Government will make the difficult decisions needed to get us back in the black.
As the Treasurer has said – If we are going to be Keynesians in the downturn, we have to be Keynesians on the way up again.
Central to framing a progressive response to these challenges is the belief that responsible fiscal policy is also responsible social policy.
With this background the Government’s budget position is clear:
returning the Budget to surplus in 2012-13;
boosting skills and participation;
addressing the pressures of a patchwork economy; and
spreading the opportunities of the mining boom.
These will be the hallmarks of this Government’s fourth Budget.
Just as there are imperatives in the near term to return to surplus, so too there is a longer term rationale.
The coming Budget will also reinforce the Government’s commitment to a fair and equitable society.
We know that a strong Budget is needed for a sustainable social safety net, and that failure to make tough calls today will require tougher calls for the next generation.
A Labor Budget – looking to the long term.
A sustainable safety net
In my time in politics I have been driven by the notion of intergenerational fairness – asking this generation to think about the next, and to act accordingly.
In Government, this idea has a particular resonance.
We expect Governments to represent the nation as a whole.
We expect them to act in the best interests of the nation.
But we also need Government to look after the next generation.
To ensure that the nation they leave for their children is better than the one they inherited from their parents.
This includes managing the budget, but it also is relevant to the broader delivery of Government services – particularly those for the most disadvantaged in society.
At the core of the Labor project is the belief that the role of Government includes helping those in need.
Those that are vulnerable.
And those that cannot provide for themselves.
Labor Governments have been central to creating our social safety net, driven by the belief that a progressive society is a just and fair society.
The idea that a strong community helps those in need and provides opportunity for those that can look after themselves.
If we focus only on meeting today’s demands we will, in the end, crowd out those in need from this generation and the next.
Creating opportunity is at the centre of Government.
But as a Labor Government we need to provide opportunities to those most in need of opportunity.
For today, and tomorrow.
From some on the Left we see the push to meet these demands – free tertiary education and increasing funding for public transport are just two examples.
On their own, these policies can be persuasive, on their own they have merit – however in aggregate they are unsustainable.
The Government providing funding for services to someone who can afford them, squeezes out funding for those who cannot.
Government’s budgets are finite, and always will be.
And in the end it is the most vulnerable that often lose out.
We know that without sustainable finances, progressive outcomes are not possible.
Labor values of fairness, equity and opportunity will not be realised.
We only have to look to the UK or the US to see the impact on social safety nets when budget positions deteriorate.
In the United Kingdom we are seeing this played out right now. You have a government faced with an economic crisis slashing spending on education and public services.
For example the UK Government has made deep and lasting cuts into the higher education sector, matched by increased university fees to a level that puts tertiary education beyond reach for thousands of Britons.
The circumstances in Greece and Ireland paint an even darker picture.
This is what can occur without sustainable and responsible budget practices.
Interestingly, when it comes to fiscal matters, arguments from some on the left can diverge from other significant policy positions.
For instance, you would struggle to find anyone associating with progressive politics who would not support action on climate change today so that tomorrow’s generation don’t have to carry an even heavier burden.
And yet this same rationale does not always apply to budgeting.
Locking in spending today is locking in a tax burden tomorrow.
With an ageing population and known structural pressures in the Commonwealth Budget, the burden on the next generation will already be heavy – and yet many on the left seem keen to add to it.
This is not the view of our Government.
For our Government, fiscal responsibility is ultimately social responsibility.
And our record is clear.
The Government has been repairing the long term structural position of budget, making family and age pensions and healthcare expenditure more sustainable.
By 2050 these saves are expected to have generated a cumulative save of $300 billion in real terms.
This is $300 billion that can be allocated to helping those most in need, investing in education or improving access to healthcare.
The Government’s position is clear – making budget cuts today will provide the foundations of a sustainable safety net and strong progressive programs.
This will require prioritisation. This will invariably require tough choices.
But it is the right approach.
The Gillard Government is acting today, to ensure higher living standards and better services for the next generation.
Jobs
Key to the framing of the 2011-12 Budget is the importance of employment.
This is not surprising.
The Labor Party was founded on the value of employment, on the principle of a fair day’s wage for a fair day’s work.
And our record stands proud following the GFC.
Where the Opposition would have faltered, the Government acted.
The stimulus program rolled out by the Government saved 200,000 jobs and stabilised the economy.
Compare these facts with other countries and you quickly see how effective the Government response was: approximately 30 million jobs were shed around the world, with around 7 million jobs lost in the US alone.
Each of these unemployed Americans has a family, each has aspirations, and each has to find another means to make ends meet.
This human side of the financial crisis was largely avoided in Australia.
And yet the imperative to work – the value of a good job – should never be taken lightly.
Against the back drop of the Mining Boom Mark II, the imperative is even greater.
And it is this imperative that will sit at the core of the Budget.
Indeed this is at the core of what it means to be a member of the Labor party – providing lifelong opportunity through improved education, training and employment.
We recognise the dignity that comes with having a job, and earning a decent wage.
This starts with job security.
We know people are doing it tough - but we also know how much tougher it would be for those without a job.
A good job provides more than your fortnightly pay cheque – it gives purpose and provides security for the future.
And in a growing economy, the Government needs do its part to realise the abilities of more Australians and invest so that they have the training and skills they need to participate.
In the current economy – in these historic economic circumstances - inclusion through participation must be our central focus.
With already low unemployment levels and high growth, the need for more workers is the catalyst needed to break persistent cycles of social and economic exclusion.
Drawing these two strands together – an economy in need of workers, and the many Australians that need work – is true to our Labor principles.
As the Treasurer outlined on Sunday, the Government will harness the boom to extend opportunity through the creation of 500,000 jobs in the next couple of years.
The Budget will provide other ways to extend greater opportunity in our society and to imbue more responsibility into the system.
This involves getting the incentives for work right.
It also requires investing in the skills and training necessary to unlock opportunity.
We want our workforce to be skilled and in jobs.
And this will be reflected in the coming Budget.
By putting in place the right incentives for work we will encourage more Australians than ever into the workforce, to enjoy the security and dignity of employment and break patterns of exclusion.
True to our Labor values we will be using the coming Budget to invest in skills and training to ensure that the economy’s thirst for labour is met, and workers are provided with the opportunity to enjoy the boom.
The return to surplus is also important in getting the settings right for the long term prosperity of Australia.
By stepping back and letting the private sector expand, the Government is making way for the creation of jobs, and putting in place the settings to see as many Australians benefit as possible.
Our participation reforms and investment in skills will not only nurture the boom, they will ensure the opportunities the boom creates are felt across our country and for years to come.
Concluding comments
In many ways the themes of the coming Budget echo my first speech to the Parliament.
In that speech I drew attention to the disadvantage in particular areas of Adelaide – the lack of post-school qualifications and high rates of youth unemployment.
I spoke of the need for an adequate safety net.
But I also expressed the view this could only be a baseline policy, that in Government we have to provide opportunities for people.
These ideas - of addressing inequities and ensuring a strong and lasting safety net and of providing opportunity through training and skills - have been close to my thinking as I’ve worked through this budget process with the Treasurer.
Together with the Prime Minister we will be delivering a Budget that is imbued with the values of the Labor tradition.
We all bring our own values to these debates, and to the Cabinet room.
For me, the belief that we should look beyond ourselves and beyond today has been central.
This drove me when I was Climate Change Minister.
Perhaps it was my father’s exhortation as I was growing up that “the next generation must be better than this one”.
After all, it is a universal human aspiration.
Yet not often enough does this common aspiration, so familiar to us in our personal lives, define our national politics.
Indeed, it is often a struggle even for well-intentioned politicians to keep that focus.
Because the politics of today focuses so much on today.
But a progressive vision demands we look ahead.
Because we know no prosperity can be secured and no social reform sustained unless we do.
It is a pleasure to be speaking here today for Per Capita, an organisation that makes an invaluable, although occasionally lonely, progressive contribution to public policy and discourse.
In the descriptor of the Per Capita story, the rationale for its establishment includes the presentation of the “economic and moral cases for progressive policy reform in Australia”; a focus on the long term and the avoidance of both old and false debates.
Today I want to speak to you about the values underpinning the Budget and the economic circumstances in which it has been put together.
In this context I want to focus on the progressive case for returning the Budget to surplus, why it is in our collective long term interests; and why some of the avowedly left arguments for not doing so are part of a debate which is both old and false.
Budgets are not just an exercise in accounting; budgets reflect the values and beliefs of governments.
They are not an end in and of themselves.
They are the means by which governments deliver on their priorities.
For a Labor Government, a Budget is not just about numbers, it’s about people.
The coming Budget is framed by the need to deliver strong and progressive outcomes for this generation, and the next.
It will deliver on Labor’s tradition of fairness and our recognition that equality demands opportunity.
It will reflect our belief that a strong economy is the foundation of prosperity and fairness. That prosperity must be created to be shared.
It will enhance opportunities for those in work and remove barriers to those who are not.
It will ensure that the right supports are in place for the transition from education to employment.
The Budget will also confirm the Government’s fiscal strategy, and the pathway for returning the Budget to surplus in 2012-13.
This strategy is driven by an understanding of the consequences of failing to take responsibility on fiscal matters, both for the next few years, but also beyond.
It’s driven by an understanding of the challenges that come with the mining boom and the importance of spreading its benefits as far and wide as possible.
And it’s driven by an understanding that we must look not only to our own interests but also to the next generation’s.
We know that unsustainable spending is neither responsible nor progressive – and we know that it imposes very real consequences on our children.
The Challenge
The current economic environment presents a unique set of challenges.
It can be easy to forget the economic destruction Australia avoided due to the Government’s swift response to the global financial crisis (GFC).
The current situation in most OECD nations shows what happens when countries feel the full brunt of a financial crisis.
A recession was averted by the actions of this Labor Government.
But the effects of the GFC can still be seen in the Commonwealth Budget – although stimulus spending has wound down, revenues are lagging as companies carry forward losses and consumer sentiment is still hesitant.
The GFC was a shock to the Australian economy, and to Australians.
Consumers have responded to that shock by being cautious - paying off credit cards rather than shopping, paying down their mortgages rather than going on holidays.
In addition, the impact of the Queensland and Victorian floods and Cyclone Yasi are having a significant impact on the economy in the short term, and therefore Government revenues.
Yet these short term factors will not knock Australia off its growth trajectory.
The coming record investments in the mining and resource sectors, the best terms of trade in living memory and low unemployment will see surging growth in some sectors of the economy.
As this boom gathers pace, it will exacerbate capacity constraints and further the pressures on the patchwork economy.
Without the right policy response, this wave of investment risks increasing price pressures across the economy.
Different approach?
In facing these challenges some have called on the Government to put aside its commitment to return the Budget to surplus and allow one, two, three years or more years of deficits.
We see this call particularly from some on the left, who characterise the Government’s budget strategy as an unnecessary discipline.
But consider the consequences of this course of action.
What would be the impact of not returning to surplus in 2012-13?
In the year we will return to surplus:
the mineral sector will be booming as today’s round of investments come online, exacerbating capacity constraints and pressures on the patchwork economy;
growth will be strong and above trend; and with
an unemployment rate with four in front of it.
To not have the Budget in surplus in 2012-13 would see the Government competing with the private sector for the same resources.
Restraining spending and building surpluses means we’re not compounding inflation and cost of living pressures in the years ahead.
To do otherwise would disproportionately hit those least able to adapt, those in low paying jobs, and those on fixed incomes including students and the elderly.
It would erode incomes, putting pressure on the cost of living and additional stress on household budgets.
It would aggravate the challenges of the patchwork economy, as the cost of inputs rise, putting job creation in some sectors at risk.
As the boom surges the pressures on manufacturing, services and non-mining sectors will increase, as it draws in resources and workers.
Delaying the return to surplus can also impact the longer term sustainability of the Budget – forcing us to make harder decisions in the future.
Because we need to remember that a decision today can close off a more worthy decision tomorrow.
The Government’s response
So the Government will do what is responsible.
The Government will make the difficult decisions needed to get us back in the black.
As the Treasurer has said – If we are going to be Keynesians in the downturn, we have to be Keynesians on the way up again.
Central to framing a progressive response to these challenges is the belief that responsible fiscal policy is also responsible social policy.
With this background the Government’s budget position is clear:
returning the Budget to surplus in 2012-13;
boosting skills and participation;
addressing the pressures of a patchwork economy; and
spreading the opportunities of the mining boom.
These will be the hallmarks of this Government’s fourth Budget.
Just as there are imperatives in the near term to return to surplus, so too there is a longer term rationale.
The coming Budget will also reinforce the Government’s commitment to a fair and equitable society.
We know that a strong Budget is needed for a sustainable social safety net, and that failure to make tough calls today will require tougher calls for the next generation.
A Labor Budget – looking to the long term.
A sustainable safety net
In my time in politics I have been driven by the notion of intergenerational fairness – asking this generation to think about the next, and to act accordingly.
In Government, this idea has a particular resonance.
We expect Governments to represent the nation as a whole.
We expect them to act in the best interests of the nation.
But we also need Government to look after the next generation.
To ensure that the nation they leave for their children is better than the one they inherited from their parents.
This includes managing the budget, but it also is relevant to the broader delivery of Government services – particularly those for the most disadvantaged in society.
At the core of the Labor project is the belief that the role of Government includes helping those in need.
Those that are vulnerable.
And those that cannot provide for themselves.
Labor Governments have been central to creating our social safety net, driven by the belief that a progressive society is a just and fair society.
The idea that a strong community helps those in need and provides opportunity for those that can look after themselves.
If we focus only on meeting today’s demands we will, in the end, crowd out those in need from this generation and the next.
Creating opportunity is at the centre of Government.
But as a Labor Government we need to provide opportunities to those most in need of opportunity.
For today, and tomorrow.
From some on the Left we see the push to meet these demands – free tertiary education and increasing funding for public transport are just two examples.
On their own, these policies can be persuasive, on their own they have merit – however in aggregate they are unsustainable.
The Government providing funding for services to someone who can afford them, squeezes out funding for those who cannot.
Government’s budgets are finite, and always will be.
And in the end it is the most vulnerable that often lose out.
We know that without sustainable finances, progressive outcomes are not possible.
Labor values of fairness, equity and opportunity will not be realised.
We only have to look to the UK or the US to see the impact on social safety nets when budget positions deteriorate.
In the United Kingdom we are seeing this played out right now. You have a government faced with an economic crisis slashing spending on education and public services.
For example the UK Government has made deep and lasting cuts into the higher education sector, matched by increased university fees to a level that puts tertiary education beyond reach for thousands of Britons.
The circumstances in Greece and Ireland paint an even darker picture.
This is what can occur without sustainable and responsible budget practices.
Interestingly, when it comes to fiscal matters, arguments from some on the left can diverge from other significant policy positions.
For instance, you would struggle to find anyone associating with progressive politics who would not support action on climate change today so that tomorrow’s generation don’t have to carry an even heavier burden.
And yet this same rationale does not always apply to budgeting.
Locking in spending today is locking in a tax burden tomorrow.
With an ageing population and known structural pressures in the Commonwealth Budget, the burden on the next generation will already be heavy – and yet many on the left seem keen to add to it.
This is not the view of our Government.
For our Government, fiscal responsibility is ultimately social responsibility.
And our record is clear.
The Government has been repairing the long term structural position of budget, making family and age pensions and healthcare expenditure more sustainable.
By 2050 these saves are expected to have generated a cumulative save of $300 billion in real terms.
This is $300 billion that can be allocated to helping those most in need, investing in education or improving access to healthcare.
The Government’s position is clear – making budget cuts today will provide the foundations of a sustainable safety net and strong progressive programs.
This will require prioritisation. This will invariably require tough choices.
But it is the right approach.
The Gillard Government is acting today, to ensure higher living standards and better services for the next generation.
Jobs
Key to the framing of the 2011-12 Budget is the importance of employment.
This is not surprising.
The Labor Party was founded on the value of employment, on the principle of a fair day’s wage for a fair day’s work.
And our record stands proud following the GFC.
Where the Opposition would have faltered, the Government acted.
The stimulus program rolled out by the Government saved 200,000 jobs and stabilised the economy.
Compare these facts with other countries and you quickly see how effective the Government response was: approximately 30 million jobs were shed around the world, with around 7 million jobs lost in the US alone.
Each of these unemployed Americans has a family, each has aspirations, and each has to find another means to make ends meet.
This human side of the financial crisis was largely avoided in Australia.
And yet the imperative to work – the value of a good job – should never be taken lightly.
Against the back drop of the Mining Boom Mark II, the imperative is even greater.
And it is this imperative that will sit at the core of the Budget.
Indeed this is at the core of what it means to be a member of the Labor party – providing lifelong opportunity through improved education, training and employment.
We recognise the dignity that comes with having a job, and earning a decent wage.
This starts with job security.
We know people are doing it tough - but we also know how much tougher it would be for those without a job.
A good job provides more than your fortnightly pay cheque – it gives purpose and provides security for the future.
And in a growing economy, the Government needs do its part to realise the abilities of more Australians and invest so that they have the training and skills they need to participate.
In the current economy – in these historic economic circumstances - inclusion through participation must be our central focus.
With already low unemployment levels and high growth, the need for more workers is the catalyst needed to break persistent cycles of social and economic exclusion.
Drawing these two strands together – an economy in need of workers, and the many Australians that need work – is true to our Labor principles.
As the Treasurer outlined on Sunday, the Government will harness the boom to extend opportunity through the creation of 500,000 jobs in the next couple of years.
The Budget will provide other ways to extend greater opportunity in our society and to imbue more responsibility into the system.
This involves getting the incentives for work right.
It also requires investing in the skills and training necessary to unlock opportunity.
We want our workforce to be skilled and in jobs.
And this will be reflected in the coming Budget.
By putting in place the right incentives for work we will encourage more Australians than ever into the workforce, to enjoy the security and dignity of employment and break patterns of exclusion.
True to our Labor values we will be using the coming Budget to invest in skills and training to ensure that the economy’s thirst for labour is met, and workers are provided with the opportunity to enjoy the boom.
The return to surplus is also important in getting the settings right for the long term prosperity of Australia.
By stepping back and letting the private sector expand, the Government is making way for the creation of jobs, and putting in place the settings to see as many Australians benefit as possible.
Our participation reforms and investment in skills will not only nurture the boom, they will ensure the opportunities the boom creates are felt across our country and for years to come.
Concluding comments
In many ways the themes of the coming Budget echo my first speech to the Parliament.
In that speech I drew attention to the disadvantage in particular areas of Adelaide – the lack of post-school qualifications and high rates of youth unemployment.
I spoke of the need for an adequate safety net.
But I also expressed the view this could only be a baseline policy, that in Government we have to provide opportunities for people.
These ideas - of addressing inequities and ensuring a strong and lasting safety net and of providing opportunity through training and skills - have been close to my thinking as I’ve worked through this budget process with the Treasurer.
Together with the Prime Minister we will be delivering a Budget that is imbued with the values of the Labor tradition.
We all bring our own values to these debates, and to the Cabinet room.
For me, the belief that we should look beyond ourselves and beyond today has been central.
This drove me when I was Climate Change Minister.
Perhaps it was my father’s exhortation as I was growing up that “the next generation must be better than this one”.
After all, it is a universal human aspiration.
Yet not often enough does this common aspiration, so familiar to us in our personal lives, define our national politics.
Indeed, it is often a struggle even for well-intentioned politicians to keep that focus.
Because the politics of today focuses so much on today.
But a progressive vision demands we look ahead.
Because we know no prosperity can be secured and no social reform sustained unless we do.
Saturday, April 30, 2011
Progressive Australia
PerCapita's Tim Soutphommasane discusses "Social inclusion" today 1pm Progressive Australia check the live stream http://bit.ly/maJkuv
Progressive Australia
PerCapita's David Hetherington participates in Progressive Australia event. He is a panel member discussing "Fairness, work and the economy" from 1pm to 2:15 today.
Progressive Australia will be held on 30 April and 1 May 2011 at the state of the art complex Sydney University Law School Building. For more details go to: http://bit.ly/lmj2nm
Progressive Australia will be held on 30 April and 1 May 2011 at the state of the art complex Sydney University Law School Building. For more details go to: http://bit.ly/lmj2nm
Public forum with Senator Penny Wong, George Megalogenis and John Freebairn, Melbourne, 3 May 2011
INVITATION
Please join us for a public forum, with guest speaker Senator the Hon. Penny Wong, Minister for Finance and Deregulation, and panel members journalist and political commentator George Megalogenis from The Australian, Professor John Freebairn from the Department of Economics at the University of Melbourne, and Per Capita's Executive Director, David Hetherington.
The Minister will be discussing the importance of the return to surplus, to ensure the Government can continue to provide a safety net for the most disadvantaged in our society. This will be followed by a lively discussion with our panel members.
When: Tuesday 3 May, 1.30pm
Where: Melbourne Town Hall, Condell Room
Cost: No charge
RSVP: Allison Orr, 0423 602 771, a.orr@percapita.org.au
Afternoon tea will be served.
Please join us for a public forum, with guest speaker Senator the Hon. Penny Wong, Minister for Finance and Deregulation, and panel members journalist and political commentator George Megalogenis from The Australian, Professor John Freebairn from the Department of Economics at the University of Melbourne, and Per Capita's Executive Director, David Hetherington.
The Minister will be discussing the importance of the return to surplus, to ensure the Government can continue to provide a safety net for the most disadvantaged in our society. This will be followed by a lively discussion with our panel members.
When: Tuesday 3 May, 1.30pm
Where: Melbourne Town Hall, Condell Room
Cost: No charge
RSVP: Allison Orr, 0423 602 771, a.orr@percapita.org.au
Afternoon tea will be served.
Friday, April 29, 2011
The False Trade-Off of Prosperity and Fairness
Published by Progressive Australia in Economics, Fairness
by David Hetherington
At the heart of a debate around the future of work and the economy is a presumed trade-off: prosperity versus fairness. Economists like to dress this up as efficiency versus equity, and this is where the problem starts. Equity is as a troublesome caveat which serves to detract from the efficient (and elegant) solution in a zero-sum game. The first issue with this is that it implies a necessary trade-off between the two. The second is that it dehumanizes the central problem, which is why I prefer prosperity and fairness.
The evidence suggests that the trade-off between prosperity and fairness is far from clear-cut. Countries with higher incomes per person tend to be more equal. This doesn’t mean high incomes causes greater equality or vice versa, only that high incomes do not necessitate inequality. The great exception to this trend is, of course, the United States which has high incomes and high inequality. Yet even there, an interesting picture emerges. As inequality has grown in the US since 1970, average weekly earnings have fallen in real terms. Again, it’s not clear that prosperity and fairness are a necessary trade-off.
What is clear is that presenting prosperity and fairness as a trade-off makes people behave as though it is. The public debate takes the trade-off as a given and the public responds in kind. Ross Gittins writes of how participants in economic experiments behave less selfishly and more in the common interest when the experiment is titled Social Exchange Study rather than Business Transaction Study, or Community Game rather than Wall Street Game.
Over the last decade, the Australian public debate has embraced the false trade-off between prosperity and fairness, and the public mood has moved significantly in favour of prosperity over fairness. The reasons are varied, but the key point is that as a community, we are less willing to embrace solutions which deliver long-term prosperity and fairness if they involve any short-term sacrifice or cost. Deferred gratification ain’t our thing.
Companies fight tooth and nail against any proposal that remotely threatens their quarterly earnings, even where it’s clearly in the public interest – we now expect this. The orchestrated campaign against pokies reform is a case in point. What’s more curious is that they resist these proposals even where they may provide profitable opportunities down the track. The resistance of corporate Australia to a carbon price shows a lack of imagination about the opportunities presented by the transition to a low-carbon economy.
Individuals have also become less willing to sacrifice short-term prosperity in the pursuit of long-term outcomes which combine fairness and prosperity. Responses to Per Capita’s annual tax survey show that Australians want higher spending on public services and infrastructure, but believe their taxes are too high. They believe higher income earners are taxed too little, even when they are themselves high income earners who describe themselves as overtaxed.
This community sentiment has got politicians scared. The Rudd Government retreated from the CPRS in the face of focus group pressure, and Labor has been surprisingly reluctant to trumpet the success of its Keynesian response to the global financial crisis, presumably for fear of being painted as antiquated Lefties addicted to debt. While Julia Gillard’s (re-)embrace of a carbon price is welcome, progressive political leaders should do more to decouple the false link between prosperity and fairness by advancing solutions which instead reinforce a virtuous circle between the two.
The virtuous circle involves a recognition that markets provide powerful forces that can be harnessed to promote prosperity and fairness, but remain a means rather than an end. Market design has already been used successfully in areas as diverse as employment services and water management, and a well-designed carbon market is a logical next step.
The virtuous circle requires a further recognition that, contrary to the claims of classical economics, much human behaviour is predictably irrational. Policy should be developed with this insight in mind, rather than the assumption that individuals are perfectly rational, utility-maximising calculating machines. Initiatives which put pre-commitment limits on gambling losses, or provide opt-out default superannuation accounts explicitly recognize the limits of human rationality. And they demand small short-term costs, often by producers, in the pursuit of long-term social and economic gain.
The list of policy ideas that builds on these insights is long. We can capture the dividends of the mining boom by channeling super-profits tax into a sovereign wealth fund. We can increase housing supply by restricting negative gearing to new-build dwellings only. We can finance infrastructure by tapping the nation’s superannuation pool. We can stimulate R&D, not only through extra public spending, but also by promoting competition so that our large oligopolists are forced to compete on innovation as well as price.
Each of these initiatives will attract resistance from privileged incumbents threatened by change. Yet each advances fairness as well as long-term prosperity. As we’ve seen in the carbon tax debate, the battle will be fierce. Progressive leaders face no more important fight.
—
David Hetherington is the Executive Director of the progressive think tank Per Capita.
by David Hetherington
At the heart of a debate around the future of work and the economy is a presumed trade-off: prosperity versus fairness. Economists like to dress this up as efficiency versus equity, and this is where the problem starts. Equity is as a troublesome caveat which serves to detract from the efficient (and elegant) solution in a zero-sum game. The first issue with this is that it implies a necessary trade-off between the two. The second is that it dehumanizes the central problem, which is why I prefer prosperity and fairness.
The evidence suggests that the trade-off between prosperity and fairness is far from clear-cut. Countries with higher incomes per person tend to be more equal. This doesn’t mean high incomes causes greater equality or vice versa, only that high incomes do not necessitate inequality. The great exception to this trend is, of course, the United States which has high incomes and high inequality. Yet even there, an interesting picture emerges. As inequality has grown in the US since 1970, average weekly earnings have fallen in real terms. Again, it’s not clear that prosperity and fairness are a necessary trade-off.
What is clear is that presenting prosperity and fairness as a trade-off makes people behave as though it is. The public debate takes the trade-off as a given and the public responds in kind. Ross Gittins writes of how participants in economic experiments behave less selfishly and more in the common interest when the experiment is titled Social Exchange Study rather than Business Transaction Study, or Community Game rather than Wall Street Game.
Over the last decade, the Australian public debate has embraced the false trade-off between prosperity and fairness, and the public mood has moved significantly in favour of prosperity over fairness. The reasons are varied, but the key point is that as a community, we are less willing to embrace solutions which deliver long-term prosperity and fairness if they involve any short-term sacrifice or cost. Deferred gratification ain’t our thing.
Companies fight tooth and nail against any proposal that remotely threatens their quarterly earnings, even where it’s clearly in the public interest – we now expect this. The orchestrated campaign against pokies reform is a case in point. What’s more curious is that they resist these proposals even where they may provide profitable opportunities down the track. The resistance of corporate Australia to a carbon price shows a lack of imagination about the opportunities presented by the transition to a low-carbon economy.
Individuals have also become less willing to sacrifice short-term prosperity in the pursuit of long-term outcomes which combine fairness and prosperity. Responses to Per Capita’s annual tax survey show that Australians want higher spending on public services and infrastructure, but believe their taxes are too high. They believe higher income earners are taxed too little, even when they are themselves high income earners who describe themselves as overtaxed.
This community sentiment has got politicians scared. The Rudd Government retreated from the CPRS in the face of focus group pressure, and Labor has been surprisingly reluctant to trumpet the success of its Keynesian response to the global financial crisis, presumably for fear of being painted as antiquated Lefties addicted to debt. While Julia Gillard’s (re-)embrace of a carbon price is welcome, progressive political leaders should do more to decouple the false link between prosperity and fairness by advancing solutions which instead reinforce a virtuous circle between the two.
The virtuous circle involves a recognition that markets provide powerful forces that can be harnessed to promote prosperity and fairness, but remain a means rather than an end. Market design has already been used successfully in areas as diverse as employment services and water management, and a well-designed carbon market is a logical next step.
The virtuous circle requires a further recognition that, contrary to the claims of classical economics, much human behaviour is predictably irrational. Policy should be developed with this insight in mind, rather than the assumption that individuals are perfectly rational, utility-maximising calculating machines. Initiatives which put pre-commitment limits on gambling losses, or provide opt-out default superannuation accounts explicitly recognize the limits of human rationality. And they demand small short-term costs, often by producers, in the pursuit of long-term social and economic gain.
The list of policy ideas that builds on these insights is long. We can capture the dividends of the mining boom by channeling super-profits tax into a sovereign wealth fund. We can increase housing supply by restricting negative gearing to new-build dwellings only. We can finance infrastructure by tapping the nation’s superannuation pool. We can stimulate R&D, not only through extra public spending, but also by promoting competition so that our large oligopolists are forced to compete on innovation as well as price.
Each of these initiatives will attract resistance from privileged incumbents threatened by change. Yet each advances fairness as well as long-term prosperity. As we’ve seen in the carbon tax debate, the battle will be fierce. Progressive leaders face no more important fight.
—
David Hetherington is the Executive Director of the progressive think tank Per Capita.
Wednesday, April 27, 2011
Gillard boldly reignites Australia's climate debate
by David Hetherington, 18 April 2011
By announcing a tax on CO2 emmissions, Julia Gillard's Australian Labor Party has taken on the fight of its political life
Finally, the battlelines are drawn, and the contours of the political debate in Australia in 2011 are clear. It’s not an overstatement to say that Julia Gillard’s Labor government has embarked on the fight of its political life. The outcome will determine whether Gillard ends up a one-term Prime Minister or a reformist leader in the spirit of Labor heroes Bob Hawke and Paul Keating.
The battle centres on carbon pricing. Against the wishes of business leaders, the labour movement and a majority of the electorate, the Gillard government has announced that it will place a tax on CO2 emissions from July 2012. This has lit the fuse on the most heated policy debate since the introduction of a consumption tax 12 years ago.
To understand the emotions this proposal has aroused, it’s helpful to reprise Australia’s schizophrenic relationship with emission reduction policy. Australia has vast, high quality reserves of coal which have underpinned the country’s economic development by providing cheap electricity. It is one of the world’s largest coal exporters. The flipside, of course, is that Australia is the world’s largest emitter of CO2 per head.
Given this, emission reduction policies were always going to be contested. Although a healthy minority of the public supported action on climate change, the conservative Prime Minister, John Howard, refused to sign the Kyoto Protocol and for a decade chose not to attempt emissions reduction.
Then the public mood began to shift around Howard. Australia endured its worst drought in a century, which many associated with climate change, and Al Gore’s Inconvenient Truth helped join the dots. The Labor Opposition was promising to act on emissions, and voter support was swinging behind them. In response, Howard committed to introduce an emissions trading scheme (ETS). This meant that both sides of politics went to the 2007 election on a promise to introduce an ETS.
To read the full opinion on Policy Network link here: http://bit.ly/fYaOJp
By announcing a tax on CO2 emmissions, Julia Gillard's Australian Labor Party has taken on the fight of its political life
Finally, the battlelines are drawn, and the contours of the political debate in Australia in 2011 are clear. It’s not an overstatement to say that Julia Gillard’s Labor government has embarked on the fight of its political life. The outcome will determine whether Gillard ends up a one-term Prime Minister or a reformist leader in the spirit of Labor heroes Bob Hawke and Paul Keating.
The battle centres on carbon pricing. Against the wishes of business leaders, the labour movement and a majority of the electorate, the Gillard government has announced that it will place a tax on CO2 emissions from July 2012. This has lit the fuse on the most heated policy debate since the introduction of a consumption tax 12 years ago.
To understand the emotions this proposal has aroused, it’s helpful to reprise Australia’s schizophrenic relationship with emission reduction policy. Australia has vast, high quality reserves of coal which have underpinned the country’s economic development by providing cheap electricity. It is one of the world’s largest coal exporters. The flipside, of course, is that Australia is the world’s largest emitter of CO2 per head.
Given this, emission reduction policies were always going to be contested. Although a healthy minority of the public supported action on climate change, the conservative Prime Minister, John Howard, refused to sign the Kyoto Protocol and for a decade chose not to attempt emissions reduction.
Then the public mood began to shift around Howard. Australia endured its worst drought in a century, which many associated with climate change, and Al Gore’s Inconvenient Truth helped join the dots. The Labor Opposition was promising to act on emissions, and voter support was swinging behind them. In response, Howard committed to introduce an emissions trading scheme (ETS). This meant that both sides of politics went to the 2007 election on a promise to introduce an ETS.
To read the full opinion on Policy Network link here: http://bit.ly/fYaOJp
Sane minds know there's money to be made from green steel.
The Australian Financial Review Opinion Pages (p55 - 27/04/11)
by David Hetherington
(unedited)
The pitiful cries now emanating from the steel sector bring strongly to mind Jean Baptiste Colbert's famous observation that, “The art of taxation consists in so plucking the goose as to get the most feathers with the least hissing.” The hissing is now powerful enough to operate a battery of pneumatic jackhammers.
What AWU National Secretary Paul Howes, Opposition Leader Tony Abbott and BlueScope Chairman Graham Kraehe are all practicing is a form of NIMBYism - but NIMBYism on steroids. We might call these pumped-up NIMBYs “Bananas: Build Absolutely Nothing Anywhere Near Anyone.” Hitherto thought to be the preserve of the radical greens, our three musketeers have adapted it to carbon pollution schemes. If a single soul is financially worse off, we cannot have it. And the result will be economically catastrophic, because these Bananas will prevent the building of cleaner steel plants in Australia in the future.
In the meantime, in the real world, perhaps we could look at what saner folk are doing (not just saying).
The Europeans, for instance, have a consortium called ULCOS - 48 companies from 15 countries working to halve emissions from the steel sector. In our neck of the woods, a small New Zealand start-up called Lanzatech has formed a joint venture with China’s Baosteel, the second largest steel maker in the world, to build a pilot plant to capture carbon rich gases from the steel making process. After cooling and cleaning the gases, those gasses are fed to bugs that produce ethanol. Depending on the processes, the carbon-rich gases from 1 ton of steel can make up to 100 litres of ethanol, which is currently selling for more than $1 per litre.
Paul Howes, a numbers man par excellence, should immediately see that the money you can make from this ethanol far exceeds the cost of any carbon tax. 1 ton of steel emits about 1.5 tons of CO2 in manufacture, so at $20 a ton carbon tax you are $70 in front if you make ethanol from the carbon-rich gases. Call me old fashioned, but this sounds like profit to me. And that $70 doesn’t include the generous exemptions that are presently the subject of the hissing fits.
Posco, Korea's national steel maker, and the world third largest, has also signed with Lanzatech for another type of zero carbon steel making. In Posco’s case, the coking coal used in its steel making will be used to "reduce" the iron ore (essentially rust plus sand) to more or less pure iron. You can also do this with hydrogen and get very low emissions of CO2 from the process.
When coking coal gets expensive (the spot price is currently more than $300 a ton, to the joy of Queenslanders) hydrogen reduction becomes viable. The Koreans were going to use hydrogen from nuclear reactors, but post-Fukushima that may be more problematic.
Of course our three musketeers will dismiss this as pie in the sky fantasy. But there is another plentiful source of hydrogen, natural gas. Conveniently God put lots of natural gas just near where he put lots of iron ore - Western Australia.
And this is why BHP built, then closed, a hot briquetted iron (HBI) plant near Port Headland. It’s a long complex story, because there are technical challenges, but in the end BHP decided that it was easier to dig up more iron ore for $20 a ton and sell it to China for $130 a ton than make it into iron briquettes that now sell for $400 a ton.
This is a perfectly rational decision that will help BHP and its executives attain their profits and bonuses. But since the total resources of iron ore will only last 20 years if we ship it off at 1 billion tons per year we have to ask ourselves just what is in the best long-term interest of Australians (including Australian workers, Mr Howes).
Clearly the long-term international demand for iron ore is gigantic. Study after study has showed there is no end to the demand from China, India, Vietnam, Indonesia as they use steel to rehouse billions in the hundreds of giant cities springing out of the ground across Asia.
Clearly the future international requirements will be for low CO2 emission steel. This is what is known in the trade as a prediction.
Clearly Australia could supply low CO2 steel and capture the difference between the $130 it gets now for iron ore and the $800 a ton that is currently the world price of steel. And we can use our resources more slowly and extract more value from it. And employ many more workers.
Clive Palmer, for one, can certainly count. His company Austeel (part of his Mineralology group) has proposed to build an integrated iron-ore-to-slab-steel plant using natural gas in WA. This could, if configured correctly, make very green steel, for many years.
---
David Hetherington is executive director of the progressive think tank Per Capita.
by David Hetherington
(unedited)
The pitiful cries now emanating from the steel sector bring strongly to mind Jean Baptiste Colbert's famous observation that, “The art of taxation consists in so plucking the goose as to get the most feathers with the least hissing.” The hissing is now powerful enough to operate a battery of pneumatic jackhammers.
What AWU National Secretary Paul Howes, Opposition Leader Tony Abbott and BlueScope Chairman Graham Kraehe are all practicing is a form of NIMBYism - but NIMBYism on steroids. We might call these pumped-up NIMBYs “Bananas: Build Absolutely Nothing Anywhere Near Anyone.” Hitherto thought to be the preserve of the radical greens, our three musketeers have adapted it to carbon pollution schemes. If a single soul is financially worse off, we cannot have it. And the result will be economically catastrophic, because these Bananas will prevent the building of cleaner steel plants in Australia in the future.
In the meantime, in the real world, perhaps we could look at what saner folk are doing (not just saying).
The Europeans, for instance, have a consortium called ULCOS - 48 companies from 15 countries working to halve emissions from the steel sector. In our neck of the woods, a small New Zealand start-up called Lanzatech has formed a joint venture with China’s Baosteel, the second largest steel maker in the world, to build a pilot plant to capture carbon rich gases from the steel making process. After cooling and cleaning the gases, those gasses are fed to bugs that produce ethanol. Depending on the processes, the carbon-rich gases from 1 ton of steel can make up to 100 litres of ethanol, which is currently selling for more than $1 per litre.
Paul Howes, a numbers man par excellence, should immediately see that the money you can make from this ethanol far exceeds the cost of any carbon tax. 1 ton of steel emits about 1.5 tons of CO2 in manufacture, so at $20 a ton carbon tax you are $70 in front if you make ethanol from the carbon-rich gases. Call me old fashioned, but this sounds like profit to me. And that $70 doesn’t include the generous exemptions that are presently the subject of the hissing fits.
Posco, Korea's national steel maker, and the world third largest, has also signed with Lanzatech for another type of zero carbon steel making. In Posco’s case, the coking coal used in its steel making will be used to "reduce" the iron ore (essentially rust plus sand) to more or less pure iron. You can also do this with hydrogen and get very low emissions of CO2 from the process.
When coking coal gets expensive (the spot price is currently more than $300 a ton, to the joy of Queenslanders) hydrogen reduction becomes viable. The Koreans were going to use hydrogen from nuclear reactors, but post-Fukushima that may be more problematic.
Of course our three musketeers will dismiss this as pie in the sky fantasy. But there is another plentiful source of hydrogen, natural gas. Conveniently God put lots of natural gas just near where he put lots of iron ore - Western Australia.
And this is why BHP built, then closed, a hot briquetted iron (HBI) plant near Port Headland. It’s a long complex story, because there are technical challenges, but in the end BHP decided that it was easier to dig up more iron ore for $20 a ton and sell it to China for $130 a ton than make it into iron briquettes that now sell for $400 a ton.
This is a perfectly rational decision that will help BHP and its executives attain their profits and bonuses. But since the total resources of iron ore will only last 20 years if we ship it off at 1 billion tons per year we have to ask ourselves just what is in the best long-term interest of Australians (including Australian workers, Mr Howes).
Clearly the long-term international demand for iron ore is gigantic. Study after study has showed there is no end to the demand from China, India, Vietnam, Indonesia as they use steel to rehouse billions in the hundreds of giant cities springing out of the ground across Asia.
Clearly the future international requirements will be for low CO2 emission steel. This is what is known in the trade as a prediction.
Clearly Australia could supply low CO2 steel and capture the difference between the $130 it gets now for iron ore and the $800 a ton that is currently the world price of steel. And we can use our resources more slowly and extract more value from it. And employ many more workers.
Clive Palmer, for one, can certainly count. His company Austeel (part of his Mineralology group) has proposed to build an integrated iron-ore-to-slab-steel plant using natural gas in WA. This could, if configured correctly, make very green steel, for many years.
---
David Hetherington is executive director of the progressive think tank Per Capita.
Thursday, April 21, 2011
The Drum Opinion (ABC Online)
Our false cost of living crisis
Adam Clancy
Australians are facing a cost of living crisis: prices are soaring and family budgets are being pushed to breaking point. Leaders of both major parties have been repeating this schtick ad nauseum in recent weeks and they could not be more wrong. According to the Australian Bureau of Statistics, households are now saving more than 10 per cent of their income. It must be pretty hard to save that kind of money were the cost of living truly punching the kind of hole in our wallets that the Prime Minister and Opposition Leader would have us believe. Additionally, credit cards and mortgages are being paid off faster than at any time in recent memory, while the surging Aussie dollar continues to keep imports and petrol prices lower than would otherwise be the case. Given the cacophony surrounding the cost of living debate, it is understandable that many Australians feel they are not as well off as the numbers suggest they are. Lost amid Julia Gillard's “dignity of work” speech at The Sydney Institute last week was the way the Prime Minister positioned the ALP as the party of fiscal responsibility. Foreshadowing the spin that will accompany the government's upcoming spending cuts, Ms Gillard said her decision to reduce expenditure in key areas such as medical research is “the best way of helping Australians manage cost of living pressures.” It was similarly instructive when Tony Abbott defended his controversial attendance at an anti-carbon tax rally last month by arguing that “middle Australia” was “understandably angry... about how this carbon tax will hit their cost of living.” Cost of living may not be the new black, but it certainly appears to have replaced rising interest rates as the bogeyman of Australian politics. It may seem counter-intuitive, but the cost of many goods is actually decreasing. Research by CommSec economists has revealed the average wage for Victorians now buys you more milk, bread, margarine, cheese, steak, chicken and petrol than it did a year ago. Additionally, nationwide, clothing is down six per cent, major household appliances are down four per cent, and audio/visual equipment has dropped 18 per cent in the past year. Nor does this accurately take into account the tremendous quality improvements in areas such as mobile phones, computers and TVs which are now hundreds of times faster – and considerably cheaper – than their predecessors.
To read the full article, link here
Adam Clancy is a researcher at Per Capita, a progressive think tank, working on cost of living and quality of life issues.
Our false cost of living crisis
Adam Clancy
Australians are facing a cost of living crisis: prices are soaring and family budgets are being pushed to breaking point. Leaders of both major parties have been repeating this schtick ad nauseum in recent weeks and they could not be more wrong. According to the Australian Bureau of Statistics, households are now saving more than 10 per cent of their income. It must be pretty hard to save that kind of money were the cost of living truly punching the kind of hole in our wallets that the Prime Minister and Opposition Leader would have us believe. Additionally, credit cards and mortgages are being paid off faster than at any time in recent memory, while the surging Aussie dollar continues to keep imports and petrol prices lower than would otherwise be the case. Given the cacophony surrounding the cost of living debate, it is understandable that many Australians feel they are not as well off as the numbers suggest they are. Lost amid Julia Gillard's “dignity of work” speech at The Sydney Institute last week was the way the Prime Minister positioned the ALP as the party of fiscal responsibility. Foreshadowing the spin that will accompany the government's upcoming spending cuts, Ms Gillard said her decision to reduce expenditure in key areas such as medical research is “the best way of helping Australians manage cost of living pressures.” It was similarly instructive when Tony Abbott defended his controversial attendance at an anti-carbon tax rally last month by arguing that “middle Australia” was “understandably angry... about how this carbon tax will hit their cost of living.” Cost of living may not be the new black, but it certainly appears to have replaced rising interest rates as the bogeyman of Australian politics. It may seem counter-intuitive, but the cost of many goods is actually decreasing. Research by CommSec economists has revealed the average wage for Victorians now buys you more milk, bread, margarine, cheese, steak, chicken and petrol than it did a year ago. Additionally, nationwide, clothing is down six per cent, major household appliances are down four per cent, and audio/visual equipment has dropped 18 per cent in the past year. Nor does this accurately take into account the tremendous quality improvements in areas such as mobile phones, computers and TVs which are now hundreds of times faster – and considerably cheaper – than their predecessors.
To read the full article, link here
Adam Clancy is a researcher at Per Capita, a progressive think tank, working on cost of living and quality of life issues.
Wednesday, April 13, 2011
Guardian Focus Podcast: The AV referendum
Presented by Michael White and produced by Phil Maynard
On 5 May, voters in Britain will be asked to choose whether they wish to retain the first past the post voting system or switch to the alternative vote method.
The referendum was agreed as part of the coalition agreement that brought the Conservatives and Liberal Democrats into government, and the parties are on opposing sides over the issue.
So how would the alternative vote system change politics? Who supports it, and why? The Guardian's political columnist Michael White tours Westminster to hear from MPs, campaigners, pollsters and experts.
... And finally, we hear from journalist Tim Soutphommasane in Melbourne. Australia is one of the few countries to use the AV system. Soutphommasane says that while results can be slow to come in on election night itself, AV does not lessen the drama.
To read the article listen to the podcast, click here.
On 5 May, voters in Britain will be asked to choose whether they wish to retain the first past the post voting system or switch to the alternative vote method.
The referendum was agreed as part of the coalition agreement that brought the Conservatives and Liberal Democrats into government, and the parties are on opposing sides over the issue.
So how would the alternative vote system change politics? Who supports it, and why? The Guardian's political columnist Michael White tours Westminster to hear from MPs, campaigners, pollsters and experts.
... And finally, we hear from journalist Tim Soutphommasane in Melbourne. Australia is one of the few countries to use the AV system. Soutphommasane says that while results can be slow to come in on election night itself, AV does not lessen the drama.
To read the article listen to the podcast, click here.
Monday, April 4, 2011
David Hetherington to appear on Radio National, Tuesday 5/4/11 9am
Listen to David Hetherington, Executive Director of PerCapita, on Life Matters, tomorrow 5th April at 9am on Radio National.
David Hetherington to appear on ABC24 The Drum 04/04/11
Watch David Hetherington, Executive Director of PerCapita, appear tonight at 6pm on The Drum on ABC24.
Thursday, March 17, 2011
Government can win carbon tax debate
By David Hetherington, Executive Director of Per Capita writes in The Australian, March 17, 2011
THE moral outrage over Julia Gillard's carbon tax is running white hot. The conservative commentators are up in arms. The masses are outraged, Newspoll tells us. How dare she? A sitting Prime Minister proposing significant new economic policy?
The gall of it.
Yet far from decrying Gillard's audacity, we should welcome the debate it brings. Not just the specifics of the carbon tax argument but the debate itself.
For the arrival of a keenly contested substantive argument over policy goes some way to answering an emerging and important question of our time: "Is our politics broken?"
To read the whole article, click here: http://bit.ly/gmGkQ9
THE moral outrage over Julia Gillard's carbon tax is running white hot. The conservative commentators are up in arms. The masses are outraged, Newspoll tells us. How dare she? A sitting Prime Minister proposing significant new economic policy?
The gall of it.
Yet far from decrying Gillard's audacity, we should welcome the debate it brings. Not just the specifics of the carbon tax argument but the debate itself.
For the arrival of a keenly contested substantive argument over policy goes some way to answering an emerging and important question of our time: "Is our politics broken?"
To read the whole article, click here: http://bit.ly/gmGkQ9
Saturday, February 26, 2011
Great expectations lead to an age of anxiety
Op-Ed in The Weekend Austrian 26/02/11 by Tim Soutphommasane
RATCHETING concerns about the cost of living confirm one thing: we are living in an age of abundant anxiety. For all that we may be enjoying economic prosperity, this might not translate into a better quality of life. Our politicians haven't yet demonstrated they know how to deal with this undercurrent of angst. Available evidence suggests there is little basis for feeling worried. Last November, the UN's Human Development Index ranked Australia as the second most developed country in the world behind Norway.
Read the whole post here.
The full paper can be found at http://bit.ly/eqE4Ad . Video: http://bit.ly/hRT04x
RATCHETING concerns about the cost of living confirm one thing: we are living in an age of abundant anxiety. For all that we may be enjoying economic prosperity, this might not translate into a better quality of life. Our politicians haven't yet demonstrated they know how to deal with this undercurrent of angst. Available evidence suggests there is little basis for feeling worried. Last November, the UN's Human Development Index ranked Australia as the second most developed country in the world behind Norway.
Read the whole post here.
The full paper can be found at http://bit.ly/eqE4Ad . Video: http://bit.ly/hRT04x
Australians need to get a grip on quality of life anxiety
Despite widespread complaints about the cost of living and population growth, the Australian quality of life remains strong and any crisis is purely imagined. That is the conclusion of More than just lifestyle: quality of life anxiety and wellbeing, a report published by the think tank Per Capita.
According to Dr Tim Soutphommasane, a senior project leader at Per Capita and author of the report, public concern about quality of life does not accord with official pictures of Australian liveability. Studies such as the United Nations Development Programme’s Human Development Index 2010 ranked Australia the second most developed country in the world.
“By every measurable standard, Australians enjoy one of the world’s highest quality of life. That many Australians imagine otherwise reflects misplaced middle-class angst and insecurity about a sunkissed, suburban Australian lifestyle,” Dr Soutphommasane said.
More than just lifestyle, the first publication in Per Capita’s Quality of Life research program, offers a confronting critique of Australians’ understanding of quality of life. It contends that quality of life must be more than just a lifestyle concern.
The report argues that a cultural understanding of quality of life leads Australians to miss the connections between quality of life, wellbeing and freedom. Living well and the good life cannot be reduced to enjoying the material comforts of suburban lifestyle.
“It is important to understand quality of life in terms of an ethical conception of wellbeing. Politicians today still haven’t found the right register in which to speak to Australians about their desire not only for prosperity but sustainability, community and fulfilment,” Dr Soutphommasane said.
The full paper can be found at http://bit.ly/eqE4Ad . Video: http://bit.ly/hRT04x
According to Dr Tim Soutphommasane, a senior project leader at Per Capita and author of the report, public concern about quality of life does not accord with official pictures of Australian liveability. Studies such as the United Nations Development Programme’s Human Development Index 2010 ranked Australia the second most developed country in the world.
“By every measurable standard, Australians enjoy one of the world’s highest quality of life. That many Australians imagine otherwise reflects misplaced middle-class angst and insecurity about a sunkissed, suburban Australian lifestyle,” Dr Soutphommasane said.
More than just lifestyle, the first publication in Per Capita’s Quality of Life research program, offers a confronting critique of Australians’ understanding of quality of life. It contends that quality of life must be more than just a lifestyle concern.
The report argues that a cultural understanding of quality of life leads Australians to miss the connections between quality of life, wellbeing and freedom. Living well and the good life cannot be reduced to enjoying the material comforts of suburban lifestyle.
“It is important to understand quality of life in terms of an ethical conception of wellbeing. Politicians today still haven’t found the right register in which to speak to Australians about their desire not only for prosperity but sustainability, community and fulfilment,” Dr Soutphommasane said.
The full paper can be found at http://bit.ly/eqE4Ad . Video: http://bit.ly/hRT04x
Thursday, February 24, 2011
Home-grown values a multicultural triumph
by Tim Soutphommasane
The trouble is the word multiculturalism can mean different things to different people. Perhaps ironically, supporters of multiculturalism have been as much to blame as its critics for any ambiguity. Rather than defending multicultural policy in muscular liberal terms, they chose flaccid cosmopolitanism; diversity became celebrated for its own sake and not as part of the contract of citizenship. This is one of the contradictions of Australian multiculturalism. For all its liberal, nation-building genius, it is misunderstood, including by many who see themselves as its champions.
Read the whole story here
The trouble is the word multiculturalism can mean different things to different people. Perhaps ironically, supporters of multiculturalism have been as much to blame as its critics for any ambiguity. Rather than defending multicultural policy in muscular liberal terms, they chose flaccid cosmopolitanism; diversity became celebrated for its own sake and not as part of the contract of citizenship. This is one of the contradictions of Australian multiculturalism. For all its liberal, nation-building genius, it is misunderstood, including by many who see themselves as its champions.
Read the whole story here
Monday, February 14, 2011
Public intellectuals a real community benefit
"Public intellectuals a real community benefit" writes Tim Soutphommasane on 12/02/11 in The Australian. "Every now and then, we are reminded that intellectual power is capable of serving public purposes and can rightly assume partisan forms.
Think of the impact Milton Friedman had on Ronald Reagan, or the impact Friedrich von Hayek had on Margaret Thatcher.
Intellectuals implicated in the affairs of state? It will always be thus. We gain little from precious lamentations about scholars losing their political virginity.
Politics, after all, is nothing if not a contest of ideas. It would be enriched if more men and women of ideas proved capable of entering the public conversation."
Read the whole article here
Think of the impact Milton Friedman had on Ronald Reagan, or the impact Friedrich von Hayek had on Margaret Thatcher.
Intellectuals implicated in the affairs of state? It will always be thus. We gain little from precious lamentations about scholars losing their political virginity.
Politics, after all, is nothing if not a contest of ideas. It would be enriched if more men and women of ideas proved capable of entering the public conversation."
Read the whole article here
Vote for a sweeter weekly household budget
Tim Soutphommasane wrote over the weekend in The Australian "IT has become an iron law of Australian politics that leaders must pledge to ease the cost of living. ...But why must governments be responsible for ensuring that people can live with a mortgage and a pattern of consumption that they can't actually afford? Read the whole article here
Monday, February 7, 2011
Per Capita on ABC24's The Drum
Tim Soutphommasane, Senior Project Leader at Per Capita will appear tonight, Monday 7th February 2011, on The Drum, ABC News24, at 6pm.
Monday, January 31, 2011
Tiger mums not great for human children
Have parents become too afraid of tough love? Tim Soutphommasane, The Australian
Tim Soutphommasane asks in The Australian "Have parents become too afraid of tough love?"
"THREE years ago, journalist Lenore Skenazy wrote a column in The New York Sun about letting her nine-year-old son ride the New York subway on his own. ...Overnight it made her "America's worst mom". ..."Skenazy may now have to move over. America has a new "worst mom", Amy Chua. A law professor at Yale University, Chua has written Battle Hymn of the Tiger Mother, a memoir that celebrates the strict regimen of "Chinese" parenting."
To read the full article click here.
Tim Soutphommasane asks in The Australian "Have parents become too afraid of tough love?"
"THREE years ago, journalist Lenore Skenazy wrote a column in The New York Sun about letting her nine-year-old son ride the New York subway on his own. ...Overnight it made her "America's worst mom". ..."Skenazy may now have to move over. America has a new "worst mom", Amy Chua. A law professor at Yale University, Chua has written Battle Hymn of the Tiger Mother, a memoir that celebrates the strict regimen of "Chinese" parenting."
To read the full article click here.
Per Capita on Life Matters
Per Capita's David Hetherington will appear tomorrow, Monday 1st February on Life Matters, ABC Radio National, at 9am.
Per Capita on ABC24's The Drum
Per Capita's David Hetherington will appear tonight, Monday 31st January 2011 on The Drum, ABC News24, at 6pm.
Friday, January 28, 2011
Per Capita on ABC24's The Drum
Watch Per Capita's Tim Soutphommasane appear on ABC24's The Drum (iView 26/01/11) http://bit.ly/fBufdR
Watch Per Capita's David Hetherington appear on ABC24's The Drum (iView 19/01/11) http://bit.ly/fBufdR
Watch Per Capita's David Hetherington appear on ABC24's The Drum (iView 19/01/11) http://bit.ly/fBufdR
Wednesday, January 26, 2011
Wednesday, January 19, 2011
Alan Stokes calls for the revival of a volunteer corps
In today's AFR Alan Stokes calls for the revival of a national volunteer corps and cites Tim Suthphommasane idea of a new patriotism through national service, civic or military duty.
David Hetherington to appear on ABC24 The Drum tonight at 6pm
David Hetherington, Executive Director, Per Capita, will appear on The Drum ABC News24 at 6pm tonight, 19th January 2011. #auspol #ausvotes
Saturday, January 15, 2011
SOCIAL-DEMOCRAT parties lack self-belief
Per Capita Fellow Dennis Glover writes in the Australian “SOCIAL-DEMOCRAT parties have many problems at present, but perhaps the most serious is the lack of self-belief that results from their tendency to underestimate the potential appeal of the progressive agenda.” Read the full article here
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