Some of the Australian Survey of Social Attitudes 2009 results are now in the Australian Social Science Data Archive, so we can start looking at some trend data.
I’m sorry to report that support for cutting taxes compared to more spending on social services may have hit an all-time low in the history of Australian opinion polling. Though the precise question varies over time, we have similarly worded questions going back to the late 1960s. In 1967 and 1969, 26% of respondents wanted tax cuts. In 2009, it was just below that on 25% (though the lack of an explicit ‘depends’ option in the 1960s means that there were ‘soft’ supporters of both taxing and spending in their totals). The three most recent surveys are in the figure below.
Question 2005 and 2009, Australian Survey of Social Attitudes: If the government had a choice between reducing personal income taxes or increasing social spending on services like health and education which do you think it should do?
Question 2007: Australian Election Study: If the government had a choice between reducing taxes or spending more on social services, which do you think it should do?
So either my theory has taken a hit or we didn’t have much of a downturn.
My theory wasn’t so much about macroeconomic variables as household finances. I argued that when households are doing well they want to spend more on goods and services, including those services like health and education that are for many Australians provided by government. Conversely, when money is tight they want to promote the household budget and support tax cuts.
We had a high-income downturn – unemployment only rose slightly, and for people in work previously promised tax cuts, lower interest rates, and generous government handouts, left many more people better off than worse off. So with tax cuts already being delivered and little strain on most taxpaying households I think that the historical precondition for pro-tax opinion did not eventuate, and is therefore not evident in the 2009 AuSSA.