Do classical liberals and social democrats agree on anything?

As with classical liberals and libertarians, general knowledge of the worldview associated with a political label – in the case of social democrats, that state power should be used to alter the outcomes of voluntary exchange to favour groups deemed as lacking power or material resources – was confirmed in the Australian political identity survey as being highly predictive of the views of people identifying as ‘social democrats’.

Indeed, more so than for classical liberals the social democratic results (more detail and analysis here) contain few surprises. The pattern observed in the classical liberal responses of on some issues significant minorities holding views apparently at odds with their philosophy is largely absent among social democrats. The main diversity of view among social democrats is not on which side of the debate they line up, but on how strongly they back the social democratic perspective.

For example, only a tiny minority of social democrats opposed unfair dismissal laws, with the ‘dissidents’ being people who wanted to exempt small business. Only a tiny minority opposed minimum wage laws, with the division being between those prepared to concede that the laws may cost some jobs and those who – despite apparently thinking prices are important, judging by their response to price control questions – believe that the laws of supply and demand do not apply to low-wage workers. Only a tiny minority would let schools choose their own curriculum, with the dissidents being those who favour state-based curriculum.

One of the few results that surprised me was that only a third of social democrats wanted to increase the tax burden beyond its current levels as a proportion of GDP. Given that there was a generally enthusiastic response to spending questions – 59% agreeing that income should be redistributed more than it is, 76% in favour of taxpayer-funded maternity leave, only 16% agreement that benefits for families capable of self-reliance causes tax rates to be too high – it is not clear where the savings are going to come from to meet these seemingly contradictory goals. The only hint in the survey was clear majority support for phasing out support for the car industry.

On a small number of issues, there were what looked like real and significant differences of opinion among social democrats. Almost equal proportions favoured a carbon trading scheme and a carbon tax. Large numbers support both the status quo in prudential regulation of the finance industry and strengthening that regulation. Very similar numbers are for and against maintaining exceptions in discrimination law for organisations based on protected characteristics, such as gay bars and religious bodies.

Despite the clear major differences between social democrats and classical liberals, there were a few issues in which each had majorities on the same side of a political debate. Both recognise benefits from reduced tariffs such as lower prices for consumers and more efficient investment. Though social democrats are much more enthusiastic than classical liberals about using fiscal policy to manage the economic cycle, majorities in both groups majority support it. Both groups also support the ACCC preventing mergers that would substantially lessen competition in a market. And of course classical liberals, like social democrats, oppose the Rudd car plan.

On some personal liberty issues social democrats hold liberal views. Like classical liberals (though less strongly) they oppose censorship of sexually explicit materials and do not believe that marijuana use should be illegal. Like classical liberals, they are overwhelmingly in favour of improved legal recognition of gay relationships. The two groups have very similar views on abortion.

Overall, as intuition would suggest, classical liberals and social democrats are opponents on most issues. It is a tribute to the political skill of leading figures in the Hawke and Keating governments that substantial economic liberalisation occurred via a party whose supporters (67% of social democrat respondents back Labor) are generally reluctant to let the results of voluntary exchange stand.

40 Responses to “Do classical liberals and social democrats agree on anything?

  • 1
    Fitzroyalty
    April 14th, 2009 14:45

    Your research on this is interesting, but I wonder if these fixed political ideologies reflect the ways in which at least some citizens make political decisions.

    Some people have the capacity to make pragmatic rational choices on individual issues, and their choices do not add up to represent an existing political ideology.

    For example, I’m in favour of legalising all drug use but I’m also in favour of the death penaly for repeat rapists and murderers.

    Many people would not classify themselves according to tradtional political labels because the labels no longer represent anything relevant to them.

  • 2
    Tim Lambert
    April 14th, 2009 15:43

    Only a tiny minority opposed minimum wage laws, with the division being between those prepared to concede that the laws may cost some jobs and those who … believe that the laws of supply and demand do not apply to low-wage workers

    How does this compare with the fraction of classical liberals who believe that the laws of physics do not apply to human emissions of greenhouse gases?

  • 3
    Andrew Norton
    April 14th, 2009 16:25

    Tim – I am going to terminate all further greenhouse comments now (and delete any that appear), to prevent the thread being hijacked by yet another pointless exchange on this issue. Anyone interested in the answer to this question can click on the results link in the post.

  • 4
    Rajat Sood
    April 14th, 2009 16:27

    Interesting that a small majority of social democrats supports stronger prudential regulation (presumably as distinct from consumer regulation) of the finance industry. How should it be strengthened, I wonder?

  • 5
    Andrew Norton
    April 14th, 2009 16:31

    Rajat – I doubt many respondents to the survey of any ideological persuasion could accurately describe current prudential arrangements (I couldn’t). I suspect most of these answers are intuitive.

    “Many people would not classify themselves according to tradtional political labels because the labels no longer represent anything relevant to them.”

    Fitzroyalty – More a case of never did. The limited public opinion research on this subject suggests that very few people have opinions that cohere into ideologies as intellectuals would understand them, if they cohere at all. But some people find the values/assumptions underlying the major ideologies sufficiently attractive/persuasive to identify with them, and the survey was primarily directed at them.

  • 6
    Jack Strocchi
    April 14th, 2009 16:32

    #2 Tim Lambert April 14th, 2009 15:43

    How does this compare with the fraction of classical liberals who believe that the laws of physics do not apply to human emissions of greenhouse gases?

    In fairness Margaret Thatcher, that old classical liberal Right wing warhorse, was in the vanguard of combating climate change. The Australian reports on her prescience:

    IN 1990, way before climate change became an issue fought from behind fixed lines, a government leader made a plea for action.

    She argued there was a clear case for precautionary international action, action that would be sensible in any event if it improved energy efficiency, developed alternative and sustainable sources of energy and replanted forests.

    Margaret Thatcher’s interest in global warming dates back to earlier in her prime ministership. Unlike most politicians, she had some professional acquaintance with the area, graduating in chemistry from Oxford University and working for a period as a research scientist.

    In 1988, she said in a speech to the Royal Society, Britain’s national science academy, that three changes in atmospheric chemistry — greenhouse gases, the ozone hole and acid rain — warranted government action.

    She did more than talk about climate change: she set up the Hadley Centre for Climate Prediction and Research, now with a worldwide reputation for its work. She committed to bringing carbon dioxide emissions back to 1990 levels by 2005. She provided funding for reafforestation in Britain and overseas.

    Also, by shutting down the UK’s coal mines she substantially reduced that nations carbon footprint.

    She had her flaws and made her mistakes. But she was a great leader. I miss her terribly.

  • 7
    Andrew Norton
    April 14th, 2009 16:39

    Jack – This conflicts with my ruling at comment 3, but since you were probably writing before you saw it I will let this one go (it is also not on the pointless debate about whether or not climate change is happening/is due to humans.)

  • 8
    Rajat Sood
    April 14th, 2009 16:44

    But Andrew, surely there is an onus on those supporting tougher prudential regulation to have at least an idea of some inadequacy in the current arrangements. Just like there is an onus on classical liberals to have a reason for our support of the removal of centralised wage fixing (which we do – job creation and freedom of contract).

  • 9
    Tim Lambert
    April 14th, 2009 16:44

    Andrew, the results link only has the results for the climate change response question, not the climate change question.

    Can I suggest that you put the answer in a new post and ask that discussion go there? My experience is that is a better way to prevent thread derailment than telling people that they can’t discuss a particular topic.

  • 10
    Jack Strocchi
    April 14th, 2009 16:44

    Ooops Sorry I missed that.

    I am not interested in getting into a Greenhouse Gas debate. My minds pretty much made up question.

    Just trying to give Baroness Thatcher’s reputation a more rounded look. We can all agree that she was a remarkable lady.

  • 11
    Caroline
    April 14th, 2009 16:46

    A few people I discussed this with agreed that our unauditable defence spending could do with a pruning.
    and better directed spending all round would mean that raising of revenue doesn’t need to change but the spending of it does.

  • 12
    Andrew Norton
    April 14th, 2009 17:51

    Tim – I will fix that omission later, in the meantime the classical liberal and libertarian views are here. The basic stats are human causes: classical liberals 45%, social democrats 88%.

    How about people just going to the ‘environment’ category and re-reading one of the previous debates on climate change debates, rather than having another one now. I don’t think there are any views we have not heard dozens of times before.

  • 13
    Jc
    April 14th, 2009 17:59

    Tim Lambert:

    You’re a really popular guy with people from all political persuasions attending your truly excellent blog that’s based on impartiality and a desire for truth and honesty is science.

    Here’s my humble suggestion. Instead of asking Andrew to run chores for you on your favorite topic. Why don’t run your own poll, ask other blog sites of all persuasions to advertise and see what you come up with?

    Who knows Tim, you could even do better than the discredited Lancet survey you defended for years and years which found 7.8 trillion Iraqi dead. I’m sure you could come up with an equally credible result 🙂

  • 14
    Louise Staley
    April 14th, 2009 19:18

    Andrew, a really fabulously interesting series of posts.

    I wonder if you could comment on a couple of things.

    1. there is a smallish but not trivial percentage of people who describe themselves as libertarian or classical liberal but then display either non social liberal or non economic liberal leanings. I wonder if there is a group clearly mis-describing themselves in that they are off base on many questions or whether these are different individuals who just have idiosyncrasies on a particular issue. I suppose I am asking if there is a clear group of conservatives who appear unable/unwilling to describe themselves yet come through from a analysis of entire answers rather than aggregating across questions?

    2. could you provide a male/female breakdown (perhaps also by social democrat/greens v liberals/libertarians) on 4 questions that may show some interesting differences, namely abortion, maternity leave, censorship and anti-discrimination?

    thanks

  • 15
    Andrew Norton
    April 14th, 2009 19:37

    Louise – On the first question, when I started analysing the data I looked at whether I should eliminate some respondents who did not know what they were talking about. However, none of the replies I looked at where completely off-the-planet, and in the absence of clear criteria for exclusion I left them in on the assumption that they would not greatly skew the results.

    I’ll add the second question to my list of things to do – the trouble with breaking it down by ideology is low numbers, but I will see if the partial aggregation you suggest works.

  • 16
    derrida derider
    April 14th, 2009 21:14

    In their nature, multiple choice questionnaires cannot properly explore nuance, and most politically interested people hold nuanced views. The interesting thing for me in this questionnaire was the way that the framer’s own assumptions shaped the permitted choices and interpretation of those choices.

    The clearest illustration for me, though not the only one, was the question on minimum wage laws. The assumption that those who say they don’t cost jobs do not believe in the law of supply and demand is an ideological assumption. This labour economist holds, based on empiric studies, that there is indeed a part of the aggregate labour demand schedule that is very flat because of the existence of bilateral monopoly in job matches. Which means that, in some circumstances (which space doesn’t let me elucidate), minimum wages will indeed not cost jobs and so allow efficient redistribution. But in many other circumstances labour demand curve slope downwards.

    The assumption that respondents can answer a simple “yes” or “no” to this question therefore reflects the assumptions of the questioner more than the positions of respondents.

  • 17
    TerjeP (say tay-a)
    April 14th, 2009 21:39

    I think if we tried we could come up with several worthy reforms that classical liberals and social democrats could agree on. Here is one that I think should qualify:-

    http://blog.libertarian.org.au/2008/01/30/citizens-power-of-veto/

  • 18
    Russell
    April 14th, 2009 21:47

    “It is a tribute to the political skill of leading figures in the Hawke and Keating governments that substantial economic liberalisation occurred via a party whose supporters (67% of social democrat respondents back Labor) are generally reluctant to let the results of voluntary exchange stand”
    .
    Well, where else were their supporters going to go? Some, like me, went to the Greens, but preferenced Labor as the better alternative than the Liberals, others were just waiting for One Nation or some other outfit to vote for. Probably a lot of people just became a lot more cynical about politics.

  • 19
    Andrew Norton
    April 14th, 2009 21:49

    DD – I’ve seen articles making that argument re minimum wages, and the question specified that they ‘may cause some unemployment’, a statement that ought to be hard to dispute as it acknowledges the possibility of exceptions to a general rule. Yet 50% of social democrats seem reluctant to accept this possibility.It wasn’t a yes/no question, but had what I would say are the three broad positions in the debate. There was only one yes/no question in the whole survey, on compulsory voting.

  • 20
    Andrew Norton
    April 14th, 2009 21:51

    TerjeP – Not this classical liberal, but for reasons too long to explain here. I doubt social democrats would agree either, since it would challenge their power.

  • 21
    TerjeP (say tay-a)
    April 14th, 2009 21:57

    At first glance the charts do seem to suggest that the social democrats tend to be old and the classical liberals tend to be young. So perhaps there is hope for the future. 😉

  • 22
    TerjeP (say tay-a)
    April 14th, 2009 22:04

    Andrew – perhaps your reasons are too long to explain here. However you should feel free to leave a comment at the article in question that is as long as you feel is necessary. 🙂

    Here is an alternative attempt at a concensus reform. All proposed legislation should be on public display for some minimum period of time (eg 8 weeks) before parliament votes on the legislation. This would be to avoid knee jerk reforms that are ill considered and devoid of prior public debate.

  • 23
    Pete
    April 15th, 2009 21:02

    Andrew Norton @19 wrote: “I’ve seen articles making that argument re minimum wages, and the question specified that they ‘may cause some unemployment’ […] Yet 50% of social democrats seem reluctant to accept this possibility.”

    I think you’re misinterpreting the results a bit there. It’s not so much that we disagree with the laws of supply and demand, but, we consider the risk of a race to the bottom in wages to be a much greater risk to the fabric of society than any transitory unemployment caused by minimum wage laws.

    I forget who said it, but, it’s true: any company that can’t afford to pay its workers a wage which puts food on the table, housing for shelter and clothes on their backs, simply doesn’t deserve to have employees.

  • 24
    Andrew Norton
    April 15th, 2009 22:02

    “It’s not so much that we disagree with the laws of supply and demand, but, we consider the risk of a race to the bottom in wages to be a much greater risk to the fabric of society than any transitory unemployment caused by minimum wage laws.”

    I don’t think I am misinterpreting the results. What you have said here is I believe a perfectly respectable argument – that there are conflicting goals here, and that you believe that some unemployment is an acceptable price to pay to achieve the other goals. That’s why I included an option which I see as the defensible social democratic position, which about a third of classical liberals also supported.

    Yet more social democrats ignored this option in favour of another option which recognised only the benefits of minimum wage laws and not the costs.

    I suspect this does reflect an important intellectual distinction between the classical liberals and social democrats. Classical liberalism is a philosophy of trades and trade-offs, and its supporters are comfortable with the idea that there are costs and benefits. Social democrats seem to be to be far less comfortable with accepting this fact of life.

  • 25
    TerjeP (say tay-a)
    April 15th, 2009 22:25

    I forget who said it, but, it’s true: any company that can’t afford to pay its workers a wage which puts food on the table, housing for shelter and clothes on their backs, simply doesn’t deserve to have employees.

    Which is why some remote communities have double digit unemployment which entails people earning nothing at all in the way of wages that might otherwise at least put some crumbs on a makeshift table. In social policy terms it would make much more sense to abolish the minimum wage in such communities and offer handouts as an income top up. It is ludicrious to have a one size fits all minimum wage across the entire nation when there is such variation from region to region in terms of the cost of living and the rate of unemployment. If we must have a minimum wage then it ought to be adjusted for regional circumstances. This could be achieved by setting it at the local government level or by applying a regional variation formula based on regional economic criteria.

  • 26
    Graham
    April 15th, 2009 22:57

    Minimum wage.

    Stop the debate.

    And with a straight face and hand on heart, answer this biggie.

    Would there have been an economy-threatening ‘sub-prime crisis’ in the US, if that enlightened country had a decent living wage criteria, rather than the ‘work 2-3 jobs to get by’ minimum wage, set by legislators in the thrall of business donors?

  • 27
    Shem Bennett
    April 16th, 2009 00:48

    “or by applying a regional variation formula based on regional economic criteria.”

    Kind of like how socio-economic status is determined by postcode in education? 😛

    “At first glance the charts do seem to suggest that the social democrats tend to be old and the classical liberals tend to be young. So perhaps there is hope for the future.”

    Or people just become more socially democratic over time… I think the results may have been skewed at least partially by Andrew’s strong involvement with MULC, etc. Though I also think that there is a strong dislike over government amongst the young.

  • 28
    Jeremy
    April 16th, 2009 09:10

    Graham,

    Maybe not would have been, but there certainly could have been, and indeed there was.

    Why?

    Because not all the people who borrowed too much were struggling to get by. I suspect that many sub-prime borrowers had enough to live on and create decent lives for themselves and their families.

    The problem wasn’t their low wages. It was their borrowing too much relative to their capacity to pay.

  • 29
    Pete
    April 16th, 2009 12:06

    TerjeP (say tay-a) @25 wrote: “[Minimum wage policy] is why some remote communities have double digit unemployment which entails people earning nothing at all in the way of wages that might otherwise at least put some crumbs on a makeshift table.”

    No, they have double-digit unemployment because they’re way out in whoop-whoop; away from all the infrastructure, resources and commercial centres that would normally provide incoming money and employment opportunities and training to the community.

    Allowing the one shopkeeper in the township to have the locals bid the three assistant positions wages down to $3/hr isn’t going to increase employment. The owner only needs three to service its customers, he’s not going to add more, whatever the price of labour.

    Unless you’re talking about selectively abolishing the minimum wage laws for remote Aboriginal communities (which would incidentally breach our international obligations re a number of UN treaties), businesses will always congregate where the infrastructure and capital is over costs: witness the absurd costs they’re prepared to carry just for an address in the CBD.

  • 30
    TerjeP (say tay-a)
    April 16th, 2009 12:51

    Pete – We create jobs in China because the labour is cheap. If the labour was cheap in NT then we would create jobs there. Sure capital is good but it is all about trade offs. If labour is cheap enough you will move the capital to take advantage of cheap labour. And if people are poor they can only buy labour if it is cheap. In remote communities people would employ their neighbours for various activities if not for minimum wage laws. However we suffocate local commerce with such price rules. If the price is low enough then markets clear.

  • 31
    Andrew Norton
    April 16th, 2009 12:56

    While I am more on TerjeP’s side in the overall debate, unfortunately the potential labour value of a large percentage of remote community residents is near zero, due to illiteracy, innumeracy, and the absence of work habits. Their welfare entitlements vastly exceed their potential earnings, and so minimum wage laws are unlikely to be a factor explaining low employment. They did have disastrous effects in the 1960s though, causing the loss of jobs for Aboriginal stockmen.

  • 32
    TerjeP (say tay-a)
    April 16th, 2009 12:58

    p.s. You don’t need to target the law at Aboriginies. You could just say that for any given region the minimum wage is reduced by a percentage based on local factors. Those factors would include the unemployment trend for that region and the cost of living. We currently consider these factors at a national level when setting the national minimum wage, all that is suggested is that we do this on a more flexible regional basis.

  • 33
    TerjeP (say tay-a)
    April 16th, 2009 13:00

    p.p.s. We have regional communities with higher than average unemployment which don’t have generic literacy problems.

  • 34
    TerjeP (say tay-a)
    April 16th, 2009 13:03

    the potential labour value of a large percentage of remote community residents is near zero

    Then the minimum wage for those communities should also be near zero. Unless unemployment is intended. Those with skills will obviously command better wages than those without skills. Thus creating positive incentives for skill acquisition. We know capitalism creates wealth yet we deny it to poor people.

  • 35
    Pete
    April 16th, 2009 16:01

    TerjeP (say tay-a), businesses simply won’t relocate out bush no matter how cheap the labour is. The infrastructure’s not there and the transport costs to get product out to customers is too expensive. The locals don’t have enough money to be a decent local market and there’s no way anybody would choose to become a manager and travel out to live there because, again, the infrastructure like schools and hospitals aren’t accessible and the local food markets rort their customers like there’s no tomorrow due to transport expenses and lack of competition.

    I think the people in these places have an unpalatable choice to make. They can either: (a) continue to rot in these cesspits, (b) move to where the infrastructure is, get an education and make the most of what mainstream Australia can provide, or, (c) try to recapture their traditional nomadic hunter-gatherer lifestyle.

    Farming townships are marginal enough (and likely wouldn’t exist at all these days without heavy pork-barrels from the Nats), remote poverty ghettos in the middle of nowhere are even less viable.

  • 36
    TerjeP (say tay-a)
    April 16th, 2009 21:45

    Pete – you’re limiting the argument to a rather narrow example of a regional community with an unemployment problem. You’re also assuming that commerce is always something that gets imported from richer regions by richer people as opposed to being a spontaneous and natural process that can arise locally. At $1.50 per hour Joe might be willing and able to hire Fred to paint the fence. And at $1.30 per hour Fred might hire Bill to mend the roof. And at $1.40 per hour Bill might hire Mary to mind the kids. The aim of the minimum wage is to elliminate low paid jobs which is precisely what it does. If we want to unelliminate such jobs and re-empower communities then we need to remove the price regulation.

    Ironically and saddly people look at the community contribution of volunteers, who are essentially working for $0 per hour, and see this as okay and good and nobel whilst loathing the notion of somebody doing something positive and productive for $1 per hour.

  • 37
    stuart
    April 17th, 2009 09:45

    Andrew, re. not believing in laws of supply and demand.

    You’re taking a purely supply side view of things. I’d argue that the primary cause of unemployment is insufficient aggregate demand. Therefore minimum wages arent the problem, but lack of spending is. Also, destroying the purchasing power of consumers (in many cases workers reliant on the minimum wage) is not going to increase aggregate demand. If anything removing the minimum wage is going to lead consumers to increase savings as their future income is less certain, leading to decreased demand and increased unemployment.

    You stating that people dont believe in the law of supply and demand is simplistic and only reflects your ideological leanings.

  • 38
    Andrew Norton
    April 17th, 2009 10:12

    Stuart – I don’t think the minimum wage is the only or even a major cause of unemployment in Australia. But I think the implied view that employers are insensitive to the price of labour is delusional, and that minimum wage setting authorities need to be acutely conscious of the risks and dangers of their rulings. Generally, getting the wages system to do social welfare tasks, eg the US wage connection with health insurance, is misguided, not the right ‘technology’ for the task.

  • 39
    wilful
    April 21st, 2009 12:07

    it is not clear where the savings are going to come from to meet these seemingly contradictory goals.

    Well maybe if you’d asked that question, rather than putting your own spin on it, you would have been enlightened?

  • 40
    caf
    April 24th, 2009 10:13

    It seems that many of the cases where significant minorities support policies that appear to run contrary to the general principles of their political faith, the supported policy is the status quo. It seems that “if it ain’t broke, don’t fix it” in many cases overrides political ideology.