As part of his well-deserved early career award from the Academy of the Social Sciences, Andrew Leigh was asked to write a paper for their journal Dialogue. As he explains on his blog, he chose to write on something a ‘bit provocative’, the possible negative effects of ethnic and linguistic diversity. One of these possible negative (sic) effects is reduced support for the welfare state.
For this hypothesis, he draws on the work of Alberto Alesina and Ed Glaeser, who argue that one of the major reasons for the much smaller welfare state in the US compared to Europe is that the US is more racially diverse. Or to put it more bluntly, the wealthy white majority isn’t too keen on giving money to the poor black minority. Extrapolating from this, Andrew notes that Australia’s welfare state is small compared to Europe’s, and that our linguistic diversity is higher than either the US or Europe, and therefore ‘our high level of linguistic diversity helps explain Australia’s relatively small social welfare sector’.
I doubt it. Indeed, you only need to keep reading Andrew’s paper to find at least one reason for doubt. Using answers to a question in the Australian Election Survey about whether people agree or disagree with the proposition that ‘income and wealth should be redistributed’ he finds that only in Queensland is there are a statistical relationship between disagreeing with the proposition and levels of local ethnic diversity. This he puts down to the relative success of ‘racially-driven politics’ in that state, with One Nation its most public manifestation. But what about all the other states? They, after all, contain the vast majority of seats in the Australian Parliament.
My CIS colleague Peter Saunders has argued that this analysis of the comparative welfare states misses important cultural differences between the ‘Anglo’ countries and Europe. The Anglosphere countries have much older and more powerful traditions of individualism than Europe. Alan Macfarlane wrote a well-known book on this, The Origins of English Individualism, tracing it back many hundreds of years. In particular, the Anglo countries have a much greater belief in self-reliance.
Andrew L cites some survey research consistent with this – Americans and Australians are much less likely than Europeans to think the poor are trapped in poverty (ie it is not just impersonal social forces, you can personally do something to improve your lot) and much more likely than the Europeans to think that the poor are lazy. I don’t know a lot about European opinion, but there are numerous Australian surveys pointing to a moralised view of welfare among those capable of working.
In the 2005 Australian Survey of Social Attitudes, for example, only 5% of people disagreed with the proposition that ‘too many people these days rely on government handouts’. Only just over a fifth disagreed that ‘most of the unemployed just don’t want to work’. In a 2004 Saulwick Poll a mere 13% disagreed with the unemployed having to work for their welfare benefits.
Yet this isn’t exactly opposition to income redistribution as such. That Saulwick Poll found that most people were against cutting the unemployment benefit, and in the 2005 AuSSA two-thirds agreed that ‘cutting welfare benefits would damage too many people’s lives’. Polling has always shown strong support for the aged pension, and nearly half agree that ‘all families deserve payments from the government to help with the costs of raising children’. The Australian public wants to support people in need, but does not think it is fair or right that some people don’t pull their weight.
This scepticism about handouts to the ‘unworthy’ long predates any significant ethnic diversity. As John Roskam describes it in a chapter in Liberalism and the Australian Federation, pensions in the early 20th century were strictly means tested and restricted to the ‘deserving’ poor. In NSW, those who had been to prison or deserted their spouse were not eligible. When Labor expanded the welfare state after World War II, Liberal MPs expressed concerns that it would undermine self-reliance.
If we were looking at simple correlations, we would argue the opposite of Andrew’s thesis: in the post-war period Australia has become much more diverse and has spent much more on welfare. But I think this is largely coincidence – migration has put some added burdens on the welfare system, but there has been no discernible change in the public’s basic view of welfare (Richard Grant’s PhD thesis has the history).
The main differences between the Australian and European welfare states are that our system is much more heavily based on need (though there are partial excpeptions, such as the family benefits I have been complaining about) and means testing. In many European countries, when you go on benefits you receive a fairly large proportion of your previous income, but not here – that would encourage malingering and bludging, and discourage self-reliance. And that would be unfair to the people paying your bills.
To the extent that there is any relationship between ethnic diversity and welfare attitudes, it could be the reverse of Andrew’s argument. It’s not that attitudes to race drive attitudes to welfare, but attitudes to welfare drive attitudes to race. As Pauline Hanson puts it in her folksy way:
I am fed up to the back teeth with the inequalities that are being promoted by the government and paid for by the taxpayer under the assumption that Aboriginals are the most disadvantaged people in Australia. I do not believe that the colour of one’s skin determines whether you are disadvantaged. … We do not want a society in Australia in which one group enjoy one set of privileges and another group enjoy another set of privileges. Hasluck’s vision was of a single society in which racial emphases were rejected and social issues addressed. I totally agree with him, and so would the majority of Australians.
… I have done research on benefits available only to Aboriginals and challenge anyone to tell me how Aboriginals are disadvantaged when they can obtain three and five per cent housing loans denied to non-Aboriginals.
The majority of Aboriginals do not want handouts because they realise that welfare is killing them. This quote says it all: “If you give a man a fish you feed him for a day. If you teach him how to fish you feed him for a lifetime.”
She’s not upset about Aborigines because they are a different race. She is upset because they are getting benefits they don’t deserve (in her view) and which aren’t doing them any good, because they are not creating self-reliance.
My research on racial attitudes suggests that a smallish minority of Australians are ‘traditional’ racists, in that they believe some groups are inferior. But a much larger group has concern about ethnic groups ‘fitting in’, which probably means in part conforming to prevailing attitudes about work. This is probably partly why the Chinese, with their reputation for hard work, are fitting in pretty smoothly, while the Muslim Lebanese, with high rates of welfare dependence, are struggling to gain acceptance.
I don’t disagree with Andrew’s substantive policy conclusions. In general immigration is a good thing, but we should not (like some left-liberal academics do) try to conceal the problems that do exist. Where we differ is that I don’t think migration has had any significant historic influence on Australian welfare policy, and doubt that this will change in the future.