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Embracing our liberal democracy

By Chris Lewis - posted Friday, 20 November 2009


I embrace Australia’s political system. While there are some who argue that there is a greater political alternative out there (so-called social democracy), or just simply prefer to bag our political system, we are indeed fortunate to live in one of the freer societies of the world.

In addition to voting at elections and the role played by public debate on specific issues between elections, I celebrate further political expression opportunities created by the Internet and sites like On Line Opinion for both writers and respondents.

Public opinion and debate does count. One has only to view Rudd’s many radio interviews in the immediate days after a Newspoll (December 3, 2009) suggested declining support for Labor because of its approach to Sri Lankan asylum seekers.

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But that is the strength of liberalism. We accept the need for extensive debate to force policy elites to take greater account of public opinion, although many may be annoyed by individual policy outcomes.

While democracy is not perfect, it is certainly more desirable than any other political system that curtails freedom of expression or assumes the importance of policy elites.

So I do get annoyed when I read articles that attack democracy. For instance, David Fisher’s On Line Opinion piece (November 5, 2009) noted that democratic US was a danger to world peace - it exported more than US$142 billion worth of weaponry to states around the world since 1992 (half of all arms exports in 2001) - while the development of the EU offered a solution.

Sure, the US has made many policy mistakes. I agree some of the European nations (including Britain) do appear a bit more sophisticated in regards to many policy issue debates and outcomes.

But what did we really expect from the US or any other nation that assumes an international leadership role? Just as many individuals are often flawed due to their shortcomings, self-interest and ongoing mistakes, is it realistic to expect the US to abandon all contradictions to fulfill the idealism of democracy in such a competitive world?

While the EU has demonstrated the possibility of greater co-operation between like-minded democracies after centuries of shared experience, albeit that important national differences still remain, humanity continues its struggle to overcome competition between various political entities struggling for resources and the influence of certain ideas. This is despite much progress that has resulted from economic and ideological developments since the time of the 16th century when 500 independent political units existed within European feudal society alone.

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In all likelihood, human progress faces much pain ahead as individual nations make different decisions depending on their perspective and situation. In the hierarchy of nations in terms of influence and wealth, some will rise, some will fall, some will hold their ground, and others will remain poor and chaotic as few resources encourages conflict rather than social cohesion.

So what do we have left for those of us still interested in appeasing both national and international aspirations? Indeed, we have our various national struggles to either support or reject policy change in an ever-changing and interdependent world always searching for ideas which can mediate national differences to encourage co-operation.

Take efforts to address rising greenhouse gas emissions. Contrary to Clive Hamilton ridiculing the capacity of Australia’s parliamentary democracy to address such an issue (Crikey, August 12, 2009), public debate will lead to a compromise that will promote positive measures yet not destroy the national interest given our high reliance upon energy-intensive industries.

Even if we fail such a crucial test, as all societies struggle to balance economic development and environmental sustainability, Australians should not feel ashamed. Even Rudd has no real idea as he demands that we all do something about climate change, yet passionately supports the export growth of our minerals to East Asia (and China) whose growing middle class will simply compound world greenhouse gas emission levels. Worth noting that global greenhouse gas emissions increased by 38 per cent between 1992 and 2007 with the US increasing by 20 per cent, Japan 11 per cent, India 103 per cent, and China 150 per cent.

And Rudd’s failure to deal with policy complexity is increasingly evident. While Rudd notes that a much larger population is good news for the country (expected to be 35 million by 2050), and argues that his government was preparing for the immense infrastructure challenges, Treasury head Ken Henry is right to express concern that Australia may not be able to sustain a predicted 60 per cent growth in population (“Rudd welcomes big Australia”, ABC News, October 23, 2009).

But we must make policy choices. Take asylum seekers. Though Australian public opinion wants a tough stance towards asylum seekers, they also expect their leaders to do it in the smartest and fairest way. While Labor did soften aspects of the Howard government’s treatment of asylum seekers, it has failed to differentiate itself successfully in regard to refugees arriving by boat. In fact, Labor has looked foolish with its ongoing bid to negotiate with Indonesia to stop asylum seekers coming to Australia. For many, the Nauru option was preferable as Indonesia has not signed the UN convention on refugees. As Jay Esslingen noted, one has only to ask any Australian Vietnamese who had to endure many years of “hospitality” in Indonesian and Malaysian camps before arriving in Australia to note conditions there were “not fit to keep animals in, much less humans” (Letters blog, The Australian, October 31, 2009).

As Australians, we should always look to our governments to do much better.

I, for one, expect governments to do much more regarding housing, given rising purchase and rental costs. As noted by the ABS, the proportion of households who owned their property outright has dropped from 42 per cent in 1994-95 to 33 per cent in 2007-08. The proportion of households renting rose from 26 to 30 per cent in the same period. And the average debt on the others paying off homes has doubled to $150,000 (Chris Zappone, brisbanetimes.com.au November 6, 2009).

And I do not accept the efforts of recent Australian governments and the ACCC to address food prices. As noted by recent OECD price data which eliminated variables such as drought, food prices in Australia have increased 41.3 per cent since the start of 2000 with Australia experiencing the fastest rate of food price growth in the OECD (“Supermarket duopoly blamed for soaring food prices”, Sydney Morning Herald, November 9, 2009). A survey by Channel 7’s evening news (November 10, 2009) also found that a similar basket of basic foods cost $74 in a Sydney supermarket, $58 in Paris, and $52 in London and Los Angeles.

Australian September 2009 Quarter data also indicated that electricity prices were up 11.4 per cent, water and sewerage more than 14 per cent, and council rates and charges 5.7 per cent: heaven help lower income people given recent trends. A six-month study by the ACT Council of Social Service found that low-income families devoted almost 70 per cent of their budgets to necessities like food, rent and transport (Damien Larkins, ABC News, February 4, 2009).

What about Australian employment and industry? Is it merely enough to focus on productivity to attract investment? Take the US. According to US Bureau of the Census data, productivity rose by 2.5 per cent a year from 2000 to 2007, yet household income fell by 0.6 per cent over the same period.

But there will be calls for further cuts to wages to increase productivity. Just recently it was argued that US manufacturing wages must decline further (by up to 20 per cent) to match equally productive foreigners doing the same work. If not, then the US may again experience 1930s levels of unemployment (Martin Hutchinson and Edward Hadas, “Americans are overpaid”, breakingviews.com, November 11, 2009).

And now that the expansion and reliance upon services has been complicated by an unsustainable reliance upon credit and debt, how long can Australian governments quash calls for greater industry assistance. As indicated in July 2009, Australia lost a further 70,000 manufacturing jobs in the previous year (AM, ABC Radio, July 24, 2009).

There will be two general policy trends in coming years based on present problems. One, policy makers will increase taxes to meet a greater number of policy needs. Two, policy makers will attempt to make extensive policy reform to ensure that government outlays and taxation levels do not rise in order to keep the nation competitive.

Which way the tax debate goes will depend on respective national debates, influenced most by the US as the largest economy; however, I do hope that Western societies move away from any acceptance of trends that saw the rich benefit most. While Australia’s income inequality remained similar from the mid-1980s to mid-2000s, it worsened in 19 of the 24 OECD countries measured  (OECD Factbook 2009).

What should now be evident is the enormous costs that will be needed to build infrastructure, pay social welfare (even if it is streamlined), fund militaries to quash terrorism, or even provide important assistance to help build stability in nations so they do not end up hating the West. For instance, the head of Britain’s climate change watchdog (Lord Turner) recently noted that households would need to spend £10,000-£15,000 on a full energy makeover if the government is to meet its target for cutting carbon emissions by 34 per cent from 1990 levels by 2020 (Larry Elliott, “Green home makeover will cost up to £15,000, says climate watchdog chief”, guardian.co.uk, November 10, 2009).

Perhaps that is why the UK government has announced a new 50 per cent income tax band to be levied from 2010 on an estimated 350,000 people with incomes above £150,000 a year alone, designed to net about £7 billion to help meet a £175 billion deficit in government finances (“Budget tax plan: 50p rate will create new brain drain, bosses warn”, The Guardian, April 23, 2009). Perhaps that is why higher taxation may become more evident in the US too given that 10 states already face financial peril with budget deficits ranging from 12 to 49 per cent with many already raising taxes, laying off state workers, and slashing services (Tami Luhby, “10 states face financial peril”, CNNMoney.com, November 11, 2009).

While Australia is in a much better fiscal position than the UK and the US, I am worried that current Australian political leadership is indeed failing us as a growing minority suffers.

Sure the policy issues will be difficult to solve with valid points made by different perspectives.

Take health. Ian Hickie (executive director of the Brain & Mind Research Institute) recently agued that government must take on domestic vested interests to help address the shortage of general and specialist doctors that has become evident recently at a time when Australian doctors tighten their monopoly over the supply of services (Ian Hickie, “Health system held to ransom by a doctors’ racket”, Sydney Morning Herald, October 14, 2009). However, as one respondent to Hickie’s article noted, Australian doctors also expect tough rules for their qualifications to be accepted overseas, and that he or she had supervised many foreign graduates who did not have the knowledge and training expected of Australian final year medical students (Doctor shopping).

We do need to observe the link between various policy issues to reflect complexity given that employment and industry cannot merely rely on high levels of consumption and immigration. Are we really going to rely on immigrants to increasingly meet our skill needs just so we can keep government outlays low? With health, it is worth remembering that Australia’s health bureaucrats and medical training institutions in the early 1990s decided to cut the number of doctors in training.

That is why Australians must offer their various arguments in a liberal democracy to ensure that policy elites think that much harder about policy complexity. Our right to freedom of speech is indeed what makes democracy the greatest political system, notwithstanding the competitive nature of nations which will continue to ensure that progress for all of humanity is slow and perhaps incapable of perfection.

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About the Author

Chris Lewis, who completed a First Class Honours degree and PhD (Commonwealth scholarship) at Monash University, has an interest in all economic, social and environmental issues, but believes that the struggle for the ‘right’ policy mix remains an elusive goal in such a complex and competitive world.

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