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The 0.01 percent: The Rising Influence of Vested Interests in Australia
March 1, 2012 4:11 PM   Subscribe

Writing in The Monthly, Australian Treasurer Wayne Swan makes a cogent case for ongoing economic reform to deliver equity, contrasting Australian with US outcomes, and slamming three modern robber barons, Clive Palmer, Andrew Forrest and Gina Rinehart for their increasing political influence.
posted by wilful (57 comments total) 9 users marked this as a favorite

 
This is definitely an issue that needs to be brought out in public; I could write it off as simply the "Americanization" of Australian politics, that we are copying a system where people actually seem to give a fuck what Donald Trump has to say. I think it's worse than that - the sheer speed with which Australian distrust of the tall poppies has seemingly evaporated.
Liberal frontbencher Christopher Pyne has dismissed the essay as "class warfare and the politics of envy".
Okay, so we are adopting the current US style then...any suggestion that any wealthy person might not be deserving of cannonisation and it's CLASS WARFARE. Man, Christopher Pyne is such a pathetic weasel.
"The infamous billionaires protest against the mining tax would have been laughed out of town in the Australia I grew up in, and yet it received a wide and favourable reception two years ago," - Wayne Swan
Well said, Swanny.
posted by Jimbob at 4:25 PM on March 1, 2012 [4 favorites]


any suggestion that any wealthy person might not be deserving of cannonisation and it's CLASS WARFARE.

How about a suggestion that Christopher Pyne is worth of "cannonisation"?
posted by A Thousand Baited Hooks at 4:41 PM on March 1, 2012 [4 favorites]


How about a suggestion that Christopher Pyne is worth of "cannonisation"?

You get the powder, I'll get the match.
posted by wilful at 4:43 PM on March 1, 2012 [6 favorites]


How about a suggestion that Christopher Pyne is worth of "cannonisation"?

If that means I can shoot Christopher Pyne out of a cannon, I'm in favour of it.
posted by His thoughts were red thoughts at 4:44 PM on March 1, 2012


Damn it! Beaten to the punch, yet again.

I'm open to shooting him out of two cannons. Let me just go find my axe.
posted by His thoughts were red thoughts at 4:45 PM on March 1, 2012 [1 favorite]


No, I'm fine without a cannon, really.
posted by wilful at 4:46 PM on March 1, 2012


They keep saying "class warfare" like they aren't in the trenches every day.
posted by phrontist at 5:11 PM on March 1, 2012


How about a suggestion that Christopher Pyne is worth of "cannonisation"?

You get the powder, I'll get the match.

If that means I can shoot Christopher Pyne out of a cannon, I'm in favour of it.


No, Cannonisation is the opposite of Nikonisation. It's a philosophy thing.
posted by vidur at 5:18 PM on March 1, 2012 [1 favorite]


Twiggy, Clive and Gina in one post?
Flagged for skin crawlie.
posted by mattoxic at 5:24 PM on March 1, 2012 [2 favorites]


"But Australia’s fair go is today under threat from a new source. To be blunt, the rising power of vested interests is undermining our equality and threatening our democracy."
*knifehand strikes forearm from elbow to wrist three times chanting "same as it ever was"*
posted by unliteral at 5:25 PM on March 1, 2012 [1 favorite]


[Here beginith my attempt to stimulate relevant debate]

While this is a reasonable essay, and I support the sentiment, I don't really feel like Labor's actions bear it out.

For one, Labor's proposed heath insurance rebate means test kicks in at $83K/year for singles. That's hardly super rich, especially if you are living in Sydney or Melbourne where costs of living are pretty high.

It seems to me that that's basically a tax on the middle class, and a tax on the people who did what the Government wanted and got private health insurance to ease the burden on Medicare.

But the rhetoric trotted out by Labour was "cleaners shouldn't have to subsidise millionares having heath insurance":

“The legislation is a win for low and middle income earners, who for too long have been forced to subsidise the private health insurance of higher income earners through their taxes.”

In effect, lumping a large chunk of the middle class in with millionares, and characterising them as victimising 'the workers', is class warfare, badly waged.

But then, the money from this will apparently be put towards expanding Medicare to dental services, which is a very good thing.
posted by His thoughts were red thoughts at 5:25 PM on March 1, 2012 [1 favorite]


Good to see that the Liberals attack poodle, Chris Pyne, is defending those poor maligned billionaires who pay him and his Party to defend them.

Pyne has mistaken class warfare with the utter defeat of the middle and lower classes by the upper class and the exceedinly rich. Palmer owns a political party and now he plans on creating a new football code. Reinhardt own a TV station and has kids who are suing her because she doesn't want to pay for a private chef for them. Between just the two of them, they can put out any media line they want and sway the masses into thinking anything they want them to believe.

Instead of deriding Swan's essay in The Monthly as class warfare, what Pyne really should have said is "I'm surprised Swan could get anything like this published in The Monthy at all."
posted by Effigy2000 at 5:31 PM on March 1, 2012


83k all to yourself? You can afford not to be rebated, and it isn't a tax, it's a non rebate. Also, Wayne is becoming all communicatiof late. His assassination of Rudd was masterful.
posted by mattoxic at 5:31 PM on March 1, 2012 [3 favorites]


I suspect that, simply by putting Australia in the title, I lost a lot of potential readers

I've just bought and started to read Peter Hartcher's The Sweet Spot, where he argues taht by and large Australia hasn't been lucky, we've made our own luck, and have hit the goldilocks zone between excessive brutish capitalism (the rest of the anglosphere) and the unsustainable, motivation sapping debt fuelled Europeans.

Haven't made it far in yet, but overall I'm in broad agreement with him. While the Gini coefficient for Aus did get larger last decade, we've done more than any other developed country to improve the absolute wealth of our poorest.

See also this quite excellent post by Possum Comitatus.
posted by wilful at 5:33 PM on March 1, 2012 [1 favorite]


It seems to me that that's basically a tax on the middle class, and a tax on the people who did what the Government wanted and got private health insurance to ease the burden on Medicare.

Well, the private health insurance rebate was bad, bad policy to begin with (courtesy of Howard, of course). As with any such rebate, it succeeded in achieving little apart from increasing premiums, and therefore funneling government revenue into private health insurance companies. It has cost billions. I agree Labors actions don't bear Swan's comments out - if he was legitimate, he would scrap the whole thing entirely and put that money into public health, of course.
posted by Jimbob at 5:34 PM on March 1, 2012 [1 favorite]


Pyne has mistaken class warfare with the utter defeat of the middle and lower classes by the upper class and the exceedinly rich. ... Between just the two of them, they can put out any media line they want and sway the masses into thinking anything they want them to believe.

Effigy, I think my point and Swan's point is that this is one likely future, it hasn't arrived yet, and we can definitely fight to stop it.

Did you hear, MTR (Melbourne's first shock jock radio station) went broke? The Blot Report barely gets 100 000 viewers.
posted by wilful at 5:35 PM on March 1, 2012 [1 favorite]


Also, although I can't find income distributions for 2011 (the census hasn't produced that data yet), based on the 2006 census an annual income of ~$83k would put you well into the 90th percentile of the population, and I imagine it still would. Which leads one to ask - how wide, exactly, is that middle class?
posted by Jimbob at 5:41 PM on March 1, 2012 [4 favorites]


83k all to yourself? You can afford not to be rebated

Oh, I agree. But don't class the people earning that as millionaires, and don't set them in opposition to the fables 'workers'. You can justify the polcy without resorting to blunt force bullshit rhetoric.

I agree Labors actions don't bear Swan's comments out - if he was legitimate, he would scrap the whole thing entirely and put that money into public health, of course.

Perhaps that's what he would like to do, but his Government is holding on by a thread anyway. No easier way to make self interested swing voters vote against you then by costing them cash money.

As with any such rebate, it succeeded in achieving little apart from increasing premiums, and therefore funneling government revenue into private health insurance companies.

jimbob, I would love a cite on this - it's something I feel like I should understand better.
posted by His thoughts were red thoughts at 5:42 PM on March 1, 2012


fables = fabled. Ugh.
posted by His thoughts were red thoughts at 5:43 PM on March 1, 2012


Egalitarian? Hard to know what that means when you owe 600000 for a plaster box in the middle of some where you don't want to live. I think the vested interests are bank s and realtors who have transformed us into a nation of obsessives.
posted by mattoxic at 5:48 PM on March 1, 2012


His thoughts were red thoughts, this article might be a good place to start.
posted by Jimbob at 5:49 PM on March 1, 2012 [1 favorite]


googling (actually DuckDuckGoing, but that's a bit of a mouthful) "income deciles Australia" I came across this: Household Income and Income Distribution, Australia, 2009-10. LOTS of stats to get into there, here's the whole pdf. $85K a year is ~$1600 a week. That, by eye, looks to cover about 92% of Australian households.
posted by wilful at 5:50 PM on March 1, 2012 [3 favorites]


a plaster box in the middle of some where you don't want to live

What, like Brighton? ;)
posted by wilful at 5:51 PM on March 1, 2012


Oh, I agree. But don't class the people earning that as millionaires, and don't set them in opposition to the fables 'workers'. You can justify the polcy without resorting to blunt force bullshit rhetoric.

It is worth noting the 83k is not a sudden cut-off: there are step-changes to the reduction of the rebate and increase of the levy: this looks to be a good breakdown.

googling (actually DuckDuckGoing, but that's a bit of a mouthful) "income deciles Australia" I came across this

Wilful are you sure you're not looking at disposable income? Table 1.2 shows gross income, which gives us a 2009-10 mean gross household income of $68,796 for the third highest quintile, and $105,664 for the fourth highest quintile.
posted by kithrater at 5:55 PM on March 1, 2012


kithrater, yeah probably, it's easy to get lost in the data.

Australia BTW applies means testing to far more welfare than most OECD countries - it's one of the secrets of our success. Our welfare system is far better targeted (and therefore more affordable) than most. We were (rightly) outraged at the baby bonus, the first home owners scheme, all those other awful Little Johnny schemes, going to the well off as well.

I receive FTB parts A and B. Why (I mean, apart from the children obviously)? Because the desiccated little coconut wanted my vote, that's why.
posted by wilful at 6:00 PM on March 1, 2012 [1 favorite]


A buddy of mine wrote this blog about australian incomes last year.
posted by lrobertjones at 6:01 PM on March 1, 2012 [4 favorites]


jimbob, I would love a cite on this - it's something I feel like I should understand better.

Unfortunately, the ABS does not regularly gather this data - it has a "snapshot" summary of 2001, 2004-05, and 2007-08, which shows almost no change in the percentage of persons with private health insurance over that time (48.6 per cent in 2001, 48.9 per cent in 2004-05, 47 per cent in 2007-08) at Table 18 here. Table 19 at the same location also gives survey responses to why people do or do not have private heath insurance for those three periods: the "cannot afford it/too expensive" wobbles around the 60 per cent mark.

Even more unfortunately, no data from before 1999, when the private health insurance rebate was introduced.
posted by kithrater at 6:04 PM on March 1, 2012


Re health insurance, I don't have time to dig it up right now, but I am sure that Ross Gittins wrote cogently (he doesn't write any other way (unlike me)) about the issue a few years ago.

Try this though: http://www.rossgittins.com/search?q=health+insurance
posted by wilful at 6:09 PM on March 1, 2012


Hooray! Learning!
posted by His thoughts were red thoughts at 6:11 PM on March 1, 2012


What, like Brighton?

We call it Brighters
posted by mattoxic at 6:16 PM on March 1, 2012


To be blunt, the rising power of vested interests is undermining our equality and threatening our democracy. We see this most obviously in the ferocious and highly misleading campaigns waged in recent years against resource taxation reforms and the pricing of carbon pollution.

A democracy is more threatened by a government that can be rolled by a spending a few million dollars on an advertising campaign. Did the miners buy seats, hire mercenaries, or somehow seize control of the legislative powers of the country? No: they ran an ad campaign, and the government backed down. Same for the poker machine reforms.

In the last couple of years, Australia has seen the emergence of our own distributional coalitions willing to use their considerable wealth to oppose good public policy and economic reforms designed to benefit the majority... the latest example of this is the foray by Australia’s richest person, Gina Rinehart, into Fairfax Media

Someone call Rome - Saint Kerry Packer is now back on the agenda. Having the essay's only piece of evidence of this being a -recent- development in Australia as "a rich person just bought into media" is laughable. What has changed is that this government, having no outright majority in the House, apepars and acts weaker than any other recent government. This lets vested interests push the government around a lot easier.

Apart from an exercise in empty rhetoric, if the essay is a signal of a more aggressive government, the next 18 months could be interesting.
posted by kithrater at 6:42 PM on March 1, 2012 [2 favorites]


Matt Cowgill also has an interesting piece about "our" 1% here.

There was an _excellent_ piece in the global mail about poverty paranoia. Money quote: "'Far too many of us,' he wrote, 'managed to confuse Cost of Lifestyle with Cost of Living.'"

"The infamous billionaires protest against the mining tax would have been laughed out of town in the Australia I grew up in, and yet it received a wide and favourable reception from the press & Labor Right despite a largely indifferent public two years ago so we responded by booting the PM we hated, starting the whole process over again, even though it has been confirmed to have largely been completed, and ending up with a tax that will cost us more in subsidies than we get from revenue.,"

Just felt I had to correct the record somewhat there.
posted by smoke at 7:10 PM on March 1, 2012 [5 favorites]


I'm glad to see someone in a position of power come out and say that some of the richest people in Australia are exerting too much influence on policy and media. I've been learning more and more about Gina Rinehart recently and it's disturbing stuff. For example, in the 70s she and her father were actively barracking for the use of a nuclear bomb to create a harbour in Western Australia (see this recent article from the Good Weekend Magazine).
posted by Alice Russel-Wallace at 7:50 PM on March 1, 2012 [1 favorite]


Maybe I'm light headed from giving a 2hr lecture, but that was really wonderful to read. I don't even like Swan all that much, but it's nice to see someone arguing clearly and explicitly for an economic model that doesn't mirror the US all that closely.

Or maybe I'm light headed because for once -- and I never thought I'd ever say this, and hope never to say it again -- Christopher Pyne is right about something. If we're going to have any kind of confrontational discussions about tax policy, or education policy, or anything where we want to think about who gets what it a society, then the result inevitably is a kind of class warfare. What he seems to object to is the idea that someone other than the incredibly wealthy are allowed to fight it. Given that the wealthy are already fighting for their class interests, why would you expect the rest of the population to shut up and ignore their own?

Oh, right, because it's Pyne we're talking about.
posted by mixing at 8:17 PM on March 1, 2012 [2 favorites]


It's interesting that Swan seems to be actively fund raising for the CIS, IPA and the Liberal and National parties.
posted by sien at 8:45 PM on March 1, 2012


to deliver equity

Did you mean "equality" there? Swan doesn't mention equity once in that article.

Aside from that, I'm sure that Palmer, Forrest & Rinehart have plenty of equity. It's more the equality of equity distribution that should be the issue here.
posted by UbuRoivas at 9:08 PM on March 1, 2012


And news @ 11 - Carr is taking the Foreign Minister's job. i wonder if O'Farrel will appoint him or "do a Bjelkie"
posted by mattoxic at 9:29 PM on March 1, 2012


And news @ 11 - Carr is taking the Foreign Minister's job.

That's a great opportunity for him. There must be heaps of international public/private consortia for the Federal government to pour subsidies into, when they build things that nobody wants or needs.

i wonder if O'Farrel will appoint him or "do a Bjelkie"

This is a colourful new euphemism I haven't heard before.
posted by UbuRoivas at 9:45 PM on March 1, 2012


Ubu — try this.
posted by Wolof at 10:00 PM on March 1, 2012


Wow, that sure makes my eyes glaze over now that it's beer o'clock. I'll have to try reading it again later.
posted by UbuRoivas at 10:18 PM on March 1, 2012


Yah, me too Ubu... but in good news.... BOB!!!!!
posted by taff at 12:14 AM on March 2, 2012


But Australia’s fair go is today under threat from a new source. To be blunt, the rising power of vested interests is undermining our equality and threatening our democracy. We see this most obviously in the ferocious and highly misleading campaigns waged in recent years against resource taxation reforms and the pricing of carbon pollution. The infamous billionaires’ protest against the mining tax would have been laughed out of town in the Australia I grew up in, and yet it received a wide and favourable reception two years ago. A handful of vested interests that have pocketed a disproportionate share of the nation’s economic success now feel they have a right to shape Australia’s future to satisfy their own self-interest.

It is totally bizarre what has happened in Australian politics since the Garnaut Climate Change Review and Henry Tax Review.

The conservative media was actually supportive towards the Henry Review; examples here and here. They reserved their criticisms for the government because they thought the Rudd Government wouldn't adopt enough of the suggestions.

In response the Rudd Government felt comfortable adopting a lot of the recommendations as policies; and then WHAM! the media turned on them. The miners had begun their massive media spend in response to the RSPT and they must have bought everyone because you could not find a single piece of positive press on the Rudd Government for the next two months.

SMH reported that the miners only spent 22 million dollars but I don't think includes the cost of having Tony Abbot on retainer. Even if it had cost them half a billion they still would have made out like bandits, but what a boost to the ego it would have been to them, knocking off a PM and re-writing the laws of Australia to their advantage with only 22 million dollars.
posted by vicx at 5:06 AM on March 2, 2012 [1 favorite]


googling (actually DuckDuckGoing, but that's a bit of a mouthful) "income deciles Australia" I came across this: Household Income and Income Distribution, Australia, 2009-10. LOTS of stats to get into there, here's the whole pdf. $85K a year is ~$1600 a week. That, by eye, looks to cover about 92% of Australian households.

Thats measured by households. Means testing will start at $83K for singles. This is a sensible measured approach, which will account for a whole manner of things such as combined household income, dependents and so on, of course.

Have a look at smoke's link to Matt Cowgill's blog entry up above.
posted by quosimosaur at 6:15 AM on March 2, 2012


I had a look at the link supplied by his thoughts were red thoughts and means testing for any household with a second earner or dependents kicks in at over $166K a year. Hardly unreasonable.
posted by quosimosaur at 6:25 AM on March 2, 2012 [1 favorite]


If there is a hell there will surely be a special place in it for Twiggy and Gina.

Reading this makes me ever more thankful that my passport says "Australia" on the front. Social democracy still exists in the world.

If only the US electorate could understand the difference in socialism and equal opportunity.
posted by Talez at 10:33 AM on March 2, 2012


And news @ 11 - Carr is taking the Foreign Minister's job.

That's a great opportunity for him. There must be heaps of international public/private consortia for the Federal government to pour subsidies into, when they build things that nobody wants or needs.


Coming soon - A Macquarie Bank backed toll road/tunnel from Sydney to some random spot in the middle of the Pacific.

Also, all roads in Sydney now somehow funnel you onto that toll road. You're Welcome!
posted by Hello, I'm David McGahan at 6:12 PM on March 2, 2012


Context
posted by Hello, I'm David McGahan at 6:16 PM on March 2, 2012


A Macquarie Bank backed toll road/tunnel from Sydney to some random spot in the middle of the Pacific.

Yeah it is a curious time. We are in the public works era where it is imagined that every problem can be solved with a tunnel; and this era really does suit some people. I'd put forward Campbell Newman as a man who loves to build things and has a lot of friends who are happy to help. No doubt Campbell has observed the work of Carr and others.
posted by vicx at 10:27 PM on March 2, 2012


The really terrifying thing is that NSW Labor managed to win two elections, even though pretty much everyone in the state hated them, and they were objectively pretty fucking useless. I mean, Morris Iemma? What?

Queensland is its own particular mess though.

/puts on Akubra hat, wades through flood water
posted by Hello, I'm David McGahan at 10:47 PM on March 2, 2012


The NSW Branch of the National Trust yesterday labelled Clive Palmer as a "living national treasure" (I shit you not), using this rare public platform (terribly shy our Clive) to bag Swannie, calling him an 'intellectual pygmy' (sticks and stones...). Twiggy Forrest proved just how meek and uninfluential he is by launching a full scale media blitz with full page ads in major newspapers. Swannie will continue the debate in the National Press Club today.
posted by wilful at 2:27 PM on March 4, 2012


The NSW Branch of the National Trust yesterday labelled Clive Palmer as a "living national treasure"

Along with Kylie Minogue & Olivia Newton-John, amongst others.

There were 7 vacancies to fill, as 7 of the original 1997 list of 100 national Living Treasures no longer qualified for the list, having failed to continue to satisfy the "living" criterion.

There's no indication how many people voted on the 7 vacancies, but the NSW branch of the National Trust breathlessly reported that "More than 10,000 Australians voted" for the original list, making Living Treasure status about as prestigious as an ACT Senate seat.
posted by UbuRoivas at 2:48 PM on March 4, 2012 [1 favorite]


Andrew Leigh's twitter stream (@ALeighMP):
Off to see @SwannyDPM on #FairGo @AustPressClub. For context, here are the Atkinson-Leigh top 1% estimates since 1921 http://t.co/IjIMUxaJ
Interesting data there, gradual decline 1950 - 1985. Every rich person made out like a bandit 86 - 88, then returned to trend quickly.
posted by wilful at 4:28 PM on March 4, 2012 [1 favorite]


Here's Swanny's speech. get's most interesting about 2/3rds down.
Today, we are witnessing the Americanisation of the Right in this country – obsessed with defending the advantages of the most-advantaged in our society. That has become their primary cause and all else is the search for a political strategy to sell that to the public at large.

Mr Abbott's opposition to spreading the benefits of the mining boom or preparing our economy for a clean energy future is about more than his reflex for negativity. He is of course singing for his supper – we can see that in the donations from the likes of Clive Palmer that have flooded into the Coalition's coffers in recent years.

In choosing to kneel down at the feet of the vested interests, rather than stand up for the interests of Australian workers, Mr Abbott has encouraged them at every turn. That's what explains the Coalition's plans to give a tax cut to the immensely wealthy while opposing tax breaks for small business and more retirement savings for Australians workers.

...

When you stand up to the vested interests, you're invariably accused of being anti-business or engaging in the politics of envy – these are the convenient phrases used by the champions of privilege.

My essay has been wrongly described as an attack on the rich when it is an attack on an imbalance in influence and opportunity. In a way the criticism of the essay from some quarters proves my point.
posted by wilful at 8:41 PM on March 4, 2012


"get's" ??? Sorry.
posted by wilful at 8:41 PM on March 4, 2012


Today, we are witnessing the Americanisation of the Right in this country

Unfortunately for Labor and its primary vote, this is a bipartisan trend as you would well know Swannie. After all, it was your govt that caved in on carbon tax the first time, mining tax, pokies, the Murray Darling plan - and is still happy to keep flushing money down the shitter to our moribund car industry - all examples of special interests buying a stake in our govt.

There's plenty of other examples, too. I loath Abbott and his quasi-fascist ways, but to act like the Labor party has had no hand in the corporatisation of Australian governance is ridiculous. Which party had all the state premierships that presided over an explosion of "public-private" partnerships (Public pays for it, private takes the money when over-optimistic contract conditions aren't met) again? Which govts gleefully embraced property developers whilst its members made thousands of bucks off the links? Which party let Gunns basically dictate forestry policy in Tasmania for decades? Which party's privatised the QLD rail network, NSW and VIC power, and flogged off a host of other public assets so the budget would look good - for one year, anyway?

Please, Wayne, don't me laugh/spew. Your newfound conscience is cute and all, but look, I scratched it, and underneath is the same foetid corruption that powers the Liberal party. Notions of doing the right thing in Labor are essentially like lightning in a storm - an unexpected by-product; rare but highly visible, serving mainly to illuminate the torrents of rain.
posted by smoke at 9:04 PM on March 4, 2012 [1 favorite]


gee smoke, tell us how you really feel.
posted by wilful at 9:41 PM on March 4, 2012


Which govts gleefully embraced property developers

In the case of Woollongong Council, quite literally.
posted by UbuRoivas at 7:10 PM on March 5, 2012 [2 favorites]


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