Archive for May, 2011

How gay is America?

It’s not unusual for pollsters to find that their respondents over-estimate the prevalence of people or things in the news. But I was amazed at this Gallup poll that asked its respondents to estimate the proportion of Americans who are gay.

The mean estimate was around 25%, about seven times the likely real figure, and 150% higher than the commonly cited 10% figure from the long-ago discredited Kinsey report. Only 4% of Americans gave numbers in the correct less than 5% category, and even deeming any answer less than 10% as broadly right we still get to only 13% of Americans giving a correct answer. Even most gay people would have social networks that are more than 75% straight, so these numbers are bizarre.

The 10% figure is still sometimes cited by gay activists to bolster their political case, but other questions in the Gallup survey suggest that perceptions of levels of homosexuality make little difference to political views.

(click to expand)

Legislaton for a semi-demand driven higher ed funding system

Legislaton for the demand-driven higher education funding system was finally introduced into Parliament yesterday, more than two years after it was first announced.

The government’s nervousness about how much it might cost is very evident. It reserves the right to cap how much funding any university can receive, though the cap cannot be less than the previous year. So it will be demand-driven only up to the point that demand is too expensive. It effectively means that there is not actually a student entitlement to a Commonwealth-supported place, as originally envisaged, though in practice few are likely to miss out in the near future.

Nor will universities have complete freedom to respond to demand. There is a capacity to set both minimum and maximum numbers by course, though only medicine is certain to face a cap on numbers. The reason seems plausible enough, a shortage of clinical training places, but previous attempts to regulate medical student numbers are the most commonly-cited reason for moving to voucher system: the government’s 1990s assessment of how many students were needed was hopelessly wrong, and we would have been better off if universities had responded to demand.

So though the system will be called demand-driven, that is true only in a relative sense. Specifying the number of students by university and funding cluster (groups of disciplines with the same Commonwealth funding rates) will end, but the allocation of student places will only be partly and conditionally handed over to the market.

Cracking down on dissent

Today’s media carries two stories about the increasing arrogance and authoritarianism of elements of the political class in dealing with people with contrary views.

In what looks to be linked to a quietly announced parliamentary review of campaign finance, Bob Brown has said that he will move to ban donations from tobacco companies. It’s a continuation of the ‘picking losers’ approach adopted in NSW. My nearly done campaign finance paper says of NSW:

It sets a dangerous precedent: governments legislating to reduce the political options of industries that it dislikes or sees as troublesome or unpopular. ‘Junk’ food manufacturers, retailers, and carbon-intensive industries are the obvious next candidates for such treatment. Rather than picking winners, government picks losers by using its power to politically disable organisations opposed to it and its allies.

Suggesting a very slow news day, The Age leads with a story that Crown casino has appointed former ALP secretary Karl Bitar as a lobbyist.

Populist senator Nick Xenophon was reported as saying Read the rest of this entry »

Where family payments aren’t welfare

John Howard disliked the idea that family payments were ‘welfare’. That’s why they were called ‘family tax benefits’, to emphasise that FTB was giving families back their earned money, rather than giving them a handout. At least for the generation that Howard came from, self-reliance was an important middle class idea.

I’ve never bought this argument. You don’t have to pay tax to get FTB, and indeed it is most generous to those who have no or very low market incomes. It is largely managed by Centrelink, the key institution of the Australian welfare state.

Yet an Essential survey released yesterday suggests that most people take Howard’s view. Welfare should only go to those on low incomes, but family payments aren’t welfare, just help with raising kids (what do they think single mother benefits are?). At least they support cutting benefits at $150,000.

(Apologies for the low-quality image)

Political parties are protecting themselves from the voters

My contribution to the CIS weekly email looks briefly at another aspect of the Queensland campaign finance reforms:

An expensive new public funding scheme will further benefit Labor. Under the system for previous elections, parties were paid according to the number of votes they received. For Queensland Labor, which apart from a brief post-floods boost, has been hovering around a 30% primary vote since mid-2010, pay-per-vote could be very costly. The new system will pay on a sliding scale according to how much parties spend. Regardless of their support, political parties can receive up to $5.3 million in public funding on a $1.8 million campaign investment of their own.

A party that contests all seats can spend $7.1 million. Provided they get at least 4% of the vote, for the first 10% of spending they get 100% reimbursement. For the next 80%, they get 75% reimbursement. And for the last 10% of the cap, they get 50% reimbursement.

Obviously this is much better for the ALP than getting paid per vote. But as the LNP pointed out in parliamentary debate, it is even better for Greens. I have not checked their sums, but in the parliamentary debate LNP members were claiming this could translate into $38 per Green vote, up from $1.64 under the previous pay-per-vote system.

Campaign finance reform is designed to insulate political parties from the political effects of their beliefs and actions – contrary to the previous system that made them accountable for their beliefs and actions.

HELPless taxpayers ripped off

About a year ago, I called the ATO. Unlike most people who call the ATO, I was hoping I could pay them some money – albeit not because I wanted to give the ATO revenue, but in order to make a political point about the absurdities of the HELP loan scheme.

This is the interaction between the bonus for repaying ‘early’ (to be cut from 10% to 5% as a result of the Budget) and the arrangements for FEE-HELP applying to students who enrol through Open Universities Australia (as I had) and postgraduates. Undergraduates taking out FEE-HELP loans have to pay a 25% debt surcharge/loan fee, but OUA and postgraduate students do not.

The incentive that creates, of course, is to take out a FEE-HELP loan whether you need it or not and then repay ‘early’ and get the bonus. For people like me, rather than this being a bonus for repaying early, it is a discount for paying late. Read the rest of this entry »

Strangling political activity with red tape

Just before I was about to finally get my campaign finance paper released, the Queensland ALP rammed through its campaign finance amendments to their electoral act – forcing many revisions. (The Parliamentary Library’s summary is the easiest way in, if you want the detail.)

But far worse than my inconvenience, of course, is that after the changes in NSW this is the second successful assault on political freedom in the last 12 months. The Queensland and NSW laws are generally quite similar in capping expenditure and donations, but with two main exceptions.

The first is that Queensland has largely avoided the particularly appalling NSW complete bans on donors. There is no singling out of disfavoured industries for bans, and while foreign-sourced donations to political parties are banned (as they already were), they have not followed NSW’s lead in banning all non-citizens from donating.

However Queensland is worse than NSW in its regulation of third parties. This is because they have combined NSW-style caps on donors and spending with the federal regime of disclosure. The result is extraordinarily complex – even by the red tape standards of campaign finance law. Read the rest of this entry »

Doing deals on refugees

Both Nielsen and Essential have polled on the governments recent plans for dealing with boat arrival refugees. The results seem quite sensitive to whether or not Australia is perceived as getting a good deal.

In one Essential question worded in a way that implied a straight swap of refugees between Australia and Malaysia the public was evenly divided, 40-40. But if told that that sending refugees offshore would cost more, the numbers change to 60-23 against.

Nielsen told respondents about the 1 for 5 deal, and came up with 58-35 against. (And at last a Fairfax paper is putting the full poll details online.)

The 1 for 5 deal does seem very favourable for Malaysia. If the government hasn’t guessed right about the changed incentives, they will look ridiculous.

Robust political economy (or why classical liberal institutions are best)

I was impressed by Mark Pennington when I heard him speak at a Mont Pelerin Society conference a couple of years ago, and am more impressed now after having read his new book Robust Political Economy: Classical Liberalism and the Future of Public Policy.

Pennington says in his introduction that his aim is synthesis more than originality in classical liberal theory, but the book is very ambitious in applying a ‘unified theoretical framework’ of classical liberal ideas about limits on knowledge and moral motivations to a range of partially or fully rival theories in or associated with neo-classical economics, left-liberalism, social justice, social capital and deliberative democracy.

My forthcoming review of the book is below the fold, or if you prefer here is his IEA presentation on the book and here is the Cato presentation. Read the rest of this entry »

Picking losers

Thanks to James Paterson’s piece last week in the Australian part of The Spectator, I am no longer the lone classical liberal publicly against campaign finance reform.* He notes of the terrible NSW reforms of 2010:

particular industries were singled out for bans, including tobacco, alcohol and gaming. This is in addition to bans on property developers. The list appears to have been drawn up to target businesses the Greens hate the most, so no one should be surprised if logging companies, miners and anyone selling fatty fast foods are added to the list in the future.

Instead of government picking winners, this is a case of government picking losers. The law is even worse than James says, since not all alcohol and gaming interests are banned from donations to political and third parties for NSW elections. It is just the for-profit alcohol and gaming sector, leaving Clubs NSW – long-term big donors – to carry on as before without pesky contrary influence from their commercial competitors. All campaign finance reform redistributes influence within the political class, but rarely is the playing favourites as blatant as this.

The O’Farrell goverment plans to ban all organisational donations – no companies, no unions, no NGOs. Essentially, this is a strike at the capacity of others to finance opposition to the government of the day. Any supporter of liberal democracy should be horrified.

* I temporarily forgot Chris Berg’s criticisms of campaign finance laws. Three people against the rest of the political class.