The Road to Hell
In the second essay in this series, I look at how seemingly harmless decisions turned Australia's honourable national ambitions into a game show of unearned gains and unanswered needs.
On a panel show one night a small gathering of influential white people discussed an issue affecting Indigenous Australians. Every comment was well-intentioned. But they used the terms ‘we’ and ‘us’ for themselves and their audience and referred to Aboriginal people as ‘them’.
I didn’t feel much camaraderie with the commentators. Our skin colour was the same. But our wealth, influence, postcodes, and world views were very different. I began to suspect I wasn’t one of ‘us’ either. Although we shared many privileges, it was like looking through a window on a different world. And around me I sensed an expanding congregation of ‘them’.
I noticed this discomfort in other shows on other topics. Whether it was abuse in aged care, the insufficiency of unemployment support, or the safety deficit for women, people being harmed were scrutinised in absentia by unqualified observers with little if any exposure to the problem. And their sympathies were almost always counterbalanced by concerns about ‘the economy’.
Why was every topic, every vice and virtue, measured against ‘the economy’? Did nothing matter in and of itself anymore? And what is ‘the economy’ if it somehow exists apart from human need?
It made more sense when I performed some mental substitutions. If, for example, I replaced ‘the economy’ with ‘investor returns’, the commentary became instantly more lucid.
It might be hard to grasp how a privatised public utility could magically deliver ‘lower prices’; or why an automated foreign mine would produce a ‘jobs bonanza’. But whenever the logic of a proposal eluded me, mentally replacing the advertised benefits with ‘investor returns’ made everything clearer.
Were the commentators trying to deceive? Possibly not. Predicted boons for non-investors seem to derive less from reliable evidence than from a quasi-religious certainty about the beneficence of capitalism.
Each commentator lived in a leafy suburb with a well-paid job and an investment portfolio. Their ‘economy’ was doing great. And they were confident it would do the same for everyone if we just made it bigger. This seemed to depend on other people working harder, even as they sacrificed wages and conditions, which was often mistakenly called ‘productivity’. Then growth would surely trickle down to ‘them’, although precisely how was far from obvious.
The unconscious biases of the commentariat were disturbing enough. But it was casual encounters with ordinary people I found most alarming.
After the 2020 bushfires I visited a client in Sydney. Employees were discussing the causes of the fires and what to do about them. “It’s time to round them up,” one said to me. Who were they talking about? “Greenies.”
Why would environmentalists set fire to the very thing they’d spent their lives protecting? “Because they hate us.” One bloke added: “Look at the media’s lefty bias. Instead of going after the criminals they’re giving poor old ScoMo a hard time.” This was the climate change denying Prime Minister who’d declined to properly equip the fire service and gone on holiday during the fires.
I might’ve argued. Perhaps I could’ve quoted the fire authorities themselves. But nobody arrives at these views because they’ve considered the evidence and listened to experts. When affluent, educated people start talking about rounding other people up, evidence and experts are becoming superfluous.
I observed with sadness how this suspicion was extended even to the victims. One day on a bush trail two dogs bounded up to me and as we made friends their caretaker’s expression changed from concern to relief.
“I was afraid you might be a homeless person,” she said. “There’s a few in here.”
“Perhaps they like dogs too,” I offered.
Affronted, she collected her dogs and left. I’d given myself away as one of ‘them’.
‘Us’ and ‘Them’
The 2000 Sydney Olympic Games were widely declared the “best ever”. Cathy Freeman lit the cauldron and then spread joy winning the 400m. Roy and H.G.’s scallywag commentary became world famous. Yothu Yindi performed Treaty at the closing ceremony. Midnight Oil wore ‘sorry’ T-shirts. And a large contingent of volunteers filled the city with a spirit of warm welcome. Among the colourful, contentious rabble who called Australia home at the cusp of the millennium it was hard to find anyone who wasn’t proud to be ‘one of us’.
Two decades later, that country existed mostly in myth and marketing. Our subsequent record on climate, poverty, refugees, women and Indigenous Australians conveys to the world a meaner, more myopic and reactionary character. And to protest too loudly invites scathing public rebuke. You’re liable to be labelled ‘un-Australian’. Your house may be fire-bombed[1]. You may be hounded out of the country[2]. The population of ‘Us’ has shrunk. And it’s shrinking still.
What happened?
Millions of Australians have drifted to the margins of society, from secure employment to the gig economy[3], from picturesque towns and suburbs to stressed areas[4], from subsistence to poverty, bad nutrition, and homelessness[5].
Millions of aging Australians scavenge for underpaid work and rue the shrinking social safety net[6] while millions of young people start life under a cloud, doubting they will have a rewarding career, buy a home or raise children[7].
Yet scores of my contemporaries are celebrating returns from shares and property using skills and effort hardly more sophisticated than shopping[8]; some also with careers in gambling, alcohol, junk food or some other enterprise which harms vulnerable people; and others who, as public relations advisors, tax consultants or in a similar profession, maintain their place among the lucky few by promoting and defending their interests.
It isn’t just that some people are thriving while others are missing out. It’s that some people are thriving because others are missing out. I’ve rarely met anyone who intends it to be so, but that’s the sinister genius of ‘the economy’. It abstracts our decisions into a realm of pure self-interest while the consequences register elsewhere. It protects ‘us’ from needing to do anything for ‘them’. Jailed activists, exploited workers, and endangered species are nothing to do with ‘us’. We’re just working, shopping, and making sensible investments; how can that harm anyone? But it can, including our own children.
The factors which prevent young people from buying a home without the ‘bank of Mum and Dad’ are the same factors which made some Mums and Dads rich enough to be a ‘bank’.
This change didn’t happen by accident. But to benefit you had to be in the right place at the right time.
The Last ‘Lucky’ Generation
For most of us, the only way we’ll see inside an exclusive club is if we’re signed in by a member. For some Australians, this is akin to what happened.
If you were a voter in 1996, newly elected Prime Minister John Howard wanted you to feel “relaxed and comfortable”. For wealthy retirees, business owners, tradespeople, and anyone in a wealthy or marginal seat, his sympathies were especially acute. Those demographics already leant towards the PM’s LNP Coalition. With the right kind of inducements, party strategists hoped to make the attachment bankable and lasting.
Like the North Sea oil which Norway used to build the world’s largest sovereign wealth fund, China’s rapid expansion offered a once-in-a-lifetime dividend to resource-rich Australia. But unlike Norway, Howard chose to privatise it. The home ownership scheme he had prepared for Menzies had helped steer the country away from socialism. Now in the top job, Howard tweaked our tax, superannuation, and immigration systems to favour real estate investment once again.
Whether it was part of the plan, or an unintended consequence, this started an era of accelerated house price growth, rewarding believers in ‘the Australian dream’ with substantial capital gains. And the consequences for all of us were significant.
Where We Ended Up
In the little coastal hamlet where I lived until shortly after the 2022 federal election, housing is no longer available. But curiously many houses are unoccupied. Clean and tidy, with manicured gardens, they maintain a strict façade of suburban respectability to frequently empty streets.
Some vacant houses are part of a multi-residence portfolio, whose owners register an occasional presence with a lawnmower. Others are reserved for holiday tourists when rents are astronomical. And they are interspersed with other houses where lasting occupation is signalled by driveways clogged with large, luxury SUVs, caravans, and fishing boats with dad joke names.
These are the people for whom the benefits of our century of transformation persisted. LNP incumbency is secure here. Wealth accumulation so dependable makes hardship almost unimaginable.
But not far away, thousands of people live in tents, caravans, cars, and vans. In adjacent bushland others are sleeping rough. And this patchwork of profligacy and poverty stretches across the country.
At the 2021 census over a million homes were empty[9]. But look inside a million others and you’ll find one or two people aging with multiple spare rooms. Some shelter offspring approaching middle age but unable to find an affordable alternative.
Officially there are well over a hundred thousand homeless[10], but if we include the people whose lodgings are makeshift, without basic amenities, safety or security, the number is probably closer to half a million[11]. Some hide their condition from the statistician. Some have disappeared from the body politic altogether.
Education, occupation and position aren’t the markers of success they used to be; what counts now is what you own. The commonest ignominy in contemporary Australia is to be unpropertied.
In Pentecostal Christendom, heartland of many in the previous federal government, including the former PM, material wealth is a sign not merely of luck, graft, or financial acumen but of god’s favour; the less you have, the less you matter.
How did we end up here?
Wasted Opportunity
Howard’s political strategy was astute. A rising house price can make the owner feel rich and grateful. But established residential real estate isn’t like a factory. It doesn’t produce anything and offers limited forms of employment. Turning the basic human need of shelter into a plaything for investors induced a feeding frenzy which left millions of the less affluent trapped like fodder fish.
For decades since, Australian investors have allowed productive industry to atrophy[12] while we buy what we already have from one another at escalating prices, pushing rents and mortgages beyond affordability even for full-time workers[13]. And the financial services sector, smelling the blood in the water, has encouraged it, fattening its shareholders, most of whom are also the property owners, through interest, fees, and insurance[14].
This transfer of wealth, from the poor to the rich and the young to the old, has erased much of what we once took pride in. Home ownership has declined[15], household debt[16], homelessness, and housing as a proportion of living cost[17] have risen, while our standing among rich countries on social metrics has fallen[18]. We have shuffled properties like Titanic deckchairs.
Is that what Howard intended?
Empire and the Middle Class
Status and appearances matter to humans, but they seem to matter most to people in the middle, those neither too rich nor too poor to care. And because they drive discretionary spending, both public and private, middle-class attitudes can shape the character of a whole nation.
Previous generations of Australians wore egalitarianism like a badge of national pride. While in practice some had more than others, and prejudice of all kinds was rife, it was a habit to cheer for the underdog, and general prosperity carried a felt obligation to give the less fortunate a leg-up. That changed with Howard. In this he resembles his British precursor Margaret Thatcher, whose early life had imbued her with a moral imperative for self-reliance[19].
If you were a public servant or trade unionist, neither Thatcher nor Howard wanted you to feel relaxed and comfortable at all. They wanted you to find something else to do; to remove your ‘red tape’ and employment demands from the businesses they granted pride of place. If you were unemployed, incapacitated, or otherwise disadvantaged, they wanted you to get on your feet and stop burdening those who were successful.
Thatcher brooked no limit to self-advancement, insisting there was “tons of room at the top”, and it isn’t hard to see why. A woman of ‘low birth’ could rise all the way to the office of Prime Minister. The idea any major cause of inequality might be structural never appealed to her.
But the British Empire Thatcher and Howard were born into was a hierarchy built around class, race, and gender. Exceptional people could advance, but loyalty to the establishment was instrumental, in the same way some slaves had acquired Roman citizenship. Like them, Thatcher was an advertisement for imperial patronage. And, like Howard, the biggest menace she perceived to the fount of this conditional benevolence was organised labour. She saw it as something like brigandage, and she set about destroying it. Howard followed suit.
In Thatcher’s Britain and Howard’s Australia, the middle class came to identify more with the indulgent rich than their disadvantaged neighbours. Wealth and poverty became just deserts in a morality play about ‘lifters and leaners’. Support for the welfare state dwindled.
But not every country is like this.
Different Histories
In the 1930s, the Western economic system collapsed. There was no necessity for it; no general shortage of food, water, energy, or shelter; and no want of equipment, expertise, or raw materials. Although its causes were complicated and are still debated, what ultimately disappeared was confidence. This malady was contracted by those with money to invest, who formed the upper and middle classes, but the poor suffered most of the effects.
The rapacious intoxication of runaway stock markets frightened prudent investors who exited, triggering a crash. A wave of job losses, foreclosures and rent defaults swept the world. Rather than supplement evaporating private capital to keep the wheels of commerce turning, governments imposed austerity on the poor and secured the assets of the rich.
Forced evictions became common in Australia[20]. Banks and landlords shuttered properties and turned women and children onto the street. Shanty towns sprang up on vacant land. People who were suddenly homeless and starving began to cause alarm.
In Norway, among other countries, the ruling elite recruited militia from the middle class to assist government forces with violent suppression of the dispossessed. But then something unexpected happened. The bonds between the Norwegian middle class and their neighbours – the farmers and workers who fed and clothed them – proved stronger than loyalty to their coldblooded patrons[21].
The result was systemic reform. Norway is characterised today by significant public investment and oversight in agriculture, industry, finance, and infrastructure. Progressive taxation supports generous public services. Accountability for public officials and corporations is rigorous.
It took another forty years for a similar experiment with social democracy to emerge in Australia. Post-war public investment had helped build the Snowy Hydro scheme and the Opera House. But adding comprehensive health care, higher education, legal aid, the arts, and environmental protection required a minor revolution. And it was the baby boomers – now maligned for their complacency, but back then young, energetic, and curious – who helped instal a government of transformation.
The old Australia and its imperial minders wanted none of it. No doubt many voters had been startled by the pace of change, but evidence points to Rupert Murdoch[22], Buckingham Palace[23]and the CIA[24] as factors in the Whitlam government’s premature demise. Whitlam’s great ‘crime’ was to push for true independence. And the efficacy with which the public mood was manipulated to serve foreign interests set the scene for the politics we have today.
Norway and Australia are both rich countries, and they share some challenges, housing affordability being one. But Norway is small and mountainous, dissected by fjords, lakes, glaciers, and permafrost. Land for housing is scarce, yet their homeless population is one of the world’s smallest. Australia is a continent, with extraordinary natural wealth for its modest population and much more habitable land, but a war zone’s quota of homeless people.
Both countries have been major exporters of fossil fuels. But Australia has somehow contrived to convert this into a trillion-dollar debt which can be used as a sword of Damocles when anyone suggests public spending. Norway, on the other hand, has more than a trillion dollars in actual foreign currency reserves, but little demand for it, since it lacks the social problems we refuse to address.
What can account for such a difference?
Neoliberalism
Although their gratitude prolonged his tenure, ordinary wealth builders were only the supporting cast in Howard’s story. His blatantly interventionist housing policy strengthened electoral support for a contrary program of deregulation, privatisation, and labour market liberalisation which were articles of market fundamentalist faith.
Any salutary effect on local enterprise was limited. The principles of initiative, self-reliance and voluntary support Thatcher and Howard[25] learned at local scale did not become macroeconomic norms by mere excision of government function. The suburban businesspeople who had shaped their thinking may have been very like the butcher, baker, and brewer in Adam Smith’s ‘invisible hand’ allegory; people who know each other by name, whose children play together. But the same cannot be said of the billionaires, investment funds and multinational corporations who subsequently commandeered our economies.
And while he made housing a playground for speculators and allowed market concentration to reduce media diversity and private sector competition, Howard’s other economic ‘reforms’ eroded the wages and social services which provided ordinary Australians with security[26].
The intense aversion to bureaucratic rule expressed by ‘Austrian School’ economists Schumpeter, von Mises and Hayek simply rang true for these offspring of suburban small business people. But if you’re looking for the unbidden civic mindedness they extolled, try Norway.
Winners and Losers
‘Us’ and ‘them’ are the ‘winners’ and ‘losers’ in the zero-sum game of neoliberalism. We surrendered the cause of an inclusive Australian greatness to vie with one another for a bigger share of what our more united forebears left us.
And who were those people? The ones who secured the vote, the eight-hour day, the weekend, paid leave, safe working conditions, liveable housing and public health and education? They were primarily the men and women – Indigenous, native-born and immigrant – who built the labour movement which Thatcher and Howard so despised and sought to disable; and it was on that foundation that the causes of Indigenous recognition, feminism, rainbow pride and multiculturalism shaped a more magnanimous polity.
Australia’s national ambitions have evolved in starts and stops, but under Howard, we allowed ourselves to become mired in the past. Australia was once again a settler society, where the state’s role was to secure the country, clear it of troublesome ‘natives’ and open it up for exploitation, using compliant labour and big money from overseas. A local managerial, merchant and investor class were amply rewarded, but those rewards were transient. The neglected responsibilities of full nationhood remained.
A cohort of formerly privileged white Australians were among the ‘losers’. Their numbers will grow as more deferred costs of bad governance fall due. Naturally they’ll want to blame someone and rather than the authors and beneficiaries of those policies, who are otherwise very like them, and whose success they would prefer to emulate, the temptation will be to pick on people who are different. Shrewd hucksters in politics and media will encourage them. But none of this will improve anything.
I once heard Nyikina Warrwa Custodian Dr Anne Poelina reflect with a mostly white gathering that by indiscriminately accepting the poisoned ‘rations’ of global capital we’ve been reverse assimilating, turning more of us into ‘blackfellas’; marginalised in our own country by a new kind of colonialism.
Could Howard see his part in it? I doubt it. Once our ambitions have run their course we select the evidence which vindicates us. But that may be getting harder. The times suited him back then, as he predicted. Posterity likes him less.
The white role models he refurbished – Captain Cook, the Anzacs, Donald Bradman – were overshadowed by a baser spectre from our colonial past – the lust for land and money. He didn’t reckon with the forces he unleashed; he didn’t foresee how many would be left behind; and he didn’t recognise what we collectively owe to other ways of being Australian. He, and consequently we, were afflicted with a vision which was short-sighted. And his questionable means did as much harm as the questionable ends which supposedly justified them.
As for his intentions, judged by his own interpretation of the national interest, I suppose they were good. But his career proves that isn’t enough.
The Legacy
A ‘lost decade’ ago, Tony Abbott appeared on national TV in front of a placard reading “Ditch the witch”. It referred to the Australian woman who had emulated Thatcher’s achievement as the country’s first female Prime Minister. And it told us, despite Abbott’s own appeals to the contrary[27], that the ghouls exhumed by political expedience had replaced policy and principle in the LNP’s electoral calculus.
We were no longer a reasonably cohesive polity with different but complementary visions of how a modern state should develop. There would be no ‘national interest’, except as a slogan for point-scoring. There would be a fight for dominance, no holds barred, and the winners would take all.
After his victory at the election which followed, Abbott inaugurated his Prime Ministership with the declaration that Australia was “open for business”, as if the ‘winners’ were to conduct some sort of national clearance sale. And, in fact, this is what happened, with much of what remained of our once enviable national estate. We seemed to have given up on being a ‘clever country’, or even a nice one.
Sadly, worse was to come. In the next essay I will consider the predicament we are left with.
[1] Foote, C. (2022) ‘Terrorist attack’: home of Bondi Beach media identity Jordan Shanks firebombed, MichaelWest.com, Nov 23
[2]Msimang, S (2022) Will the hateful army who bullied Yassmin Abdel-Magied come after Australia’s diverse new parliamentarians?, The Guardian, Jun 5
[3]Alexander, L (2019) Understanding Insecure Work in Australia, The McKell Institute, Jan 30
[4]Australian Bureau of Statistics (2022) Population movement in Australia, ABS, Nov 8
[5] Davidson, P; Bradbury, B; and Wong, M (2022) Poverty in Australia 2022: A snapshot, Australian Council of Social Service (ACOSS) and UNSW Sydney
[6]Macmillan, J (2021) Older jobseekers falling through the cracks in 'silent crisis', abc.net.au, Feb 11
[7]Brotherhood of St Laurence (2020) Youth unemployment monitor, Brotherhood of St Laurence
[8] Davidson, P. & Bradbury, B., (2022) The wealth inequality pandemic: COVID and wealth inequality ACOSS/UNSW Sydney Poverty and Inequality Partnership, Build Back Fairer Series Report No. 4, Sydney
[9]Australian Bureau of Statistics (2022) Housing: Census Information on housing type and housing costs, ABS, Jun 28
[10]Australian Bureau of Statistics (2018) Census of Population and Housing: Estimating Homelessness, ABS, Mar 14
[11] Pawson, H; Clarke, A; Parsell, C; and Hartley, C (2022) UNSW Australian Homelessness Monitor 2022, City Futures Research Centre, UNSW School of Social Science and University of Queensland Centre for Social Impact
[12] Source: based on Productivity Commission data, PC Productivity Insights: Recent Developments
[13] Maclennan, D., Long, J., Pawson, H., Randolph, B., Aminpour, F. and Leishman, C. (2021) Housing: Taming the elephant in the economy; Sydney: UNSW City Futures Research Centre https://cityfutures.be.unsw.edu.au/
[14]Khadem, N (2022) 'Big four' banks made huge profits as Australians took out bigger mortgages for pricier housing, abc.net.au, May 10
[15] Australian Institute of Health and Welfare (2022) Home ownership and housing tenure , AIHW, Australian Government, accessed 22 January 2023.
[16]Australian Bureau of Statistics (2019-20) Household Income and Wealth Australia, ABS
[17]Nally A (2023) Inflation is measured using a basket of goods. So how much have prices gone up?, abc.net.au, Jan 21
[18]OECD (2021) Country Statistical Profile Australia, data.oecd.org
[19] Moore, C (2015) Margaret Thatcher: The Authorized Biography: Volume One: Not for Turning, UK, Penguin Books Ltd (GB)
[20]Dinmore, H (2022) Shanty towns and eviction riots: the radical history of Australia’s property market, The Conversation, Jul 8
[21]Lakey, G (2023) How Swedes and Norwegians Broke the Power of the '1 Percent', Common Dreams, Jan 20
[22]Dorling, P (2014) Murdoch editors told to 'kill Whitlam' in 1975, Sydney Morning Herald, Jun 28
[23]Hocking, J (2020) John Kerr's letters to the Queen's private secretary: 'A raw display of devastation', The Guardian, Oct 26
[24]Pilger, J (2014) The British-American coup that ended Australian independence, The Guardian, Oct 23
[25]van Onselen P, and Errington W (2008) John Winston Howard: the definitive biography, Australia, Melbourne University Press
[26]Hull, C (2021) John Howard's legacy lives on, and we are worse for it, The Canberra Times, July 2
[27]Abbott, T (2009) Battlelines, Australia, Melbourne University Press