Who is to blame for interest rate increases?

Evidence this morning adding to what we already have that the economy is neither the electoral asset nor the electoral liability it once was, and that interest rates are not a major political issue.

A Galaxy Poll reported in the News Ltd tabloids asked

If interest rates rise again in the near future, which of the following do you believe is mainly to blame?

The political answer, John Howard, received blame from only 12% of respondents – 17% of Labor voters and 3% of Coalition voters. The other responses were ‘international factors’ (37%), the Australian economy (30%), and the Reserve Bank (14%).

Propaganda failure

The WorkChoices campaign – for and against – must be the most expensive in Australian political history. But how effective was it?

Last month I argued that perhaps the government’s ‘fairness’ test change and subsequent advertising helped ease concerns among Liberal voters. But the polling data I have been analysing over the last week for a Policy article I’ve been writing on WorkChoices tells us something, I think, about the limits of political propaganda.

All along, the polling on for or against questions about WorkChoices has been stable. Three Morgan Polls between July 2005 and April 2006 found the proportion of voters against the reforms varied by just 0.8%, after taking out those not expressing a view. Just under three-quarters of Morgan respondents with an opinion were against WorkChoices. In five ACNielsen polls, of those offering a for or against opinion, the proportion against varied from 69% to 74%, a very similar result to Morgan.

This suggest that the outline of WorkChoices triggered reactions based on stable aspects of public opinion, and nothing anyone said or did after that changed the basic yes/no position of the electorate.

On more specific aspects of WorkChoices, we do see opinion changing. Continue reading “Propaganda failure”

Are interest rates a vote changer?

Labor and the commentariat are very excited about interest rates – what with a broken promise to keep them low and the possibility of rates going up during a campaign. But as with household finances generally, do the voters have a sense of perspective that the political class lacks?

Back in August, Andrew Leigh wrote an op-ed suggesting that interest rates did not affect the 2004 election in the way conventional wisdom presumes. Today’s Newspoll suggests that the 2007 election may be similar.

In a question asking whether the respondent would be less likely to vote for the Coalition if interest rates went up, only 9% said it would. That was largely driven by people who had already said they were going to vote Labor. Only 2% of those indicating support for the Liberals said that they would be less likely to vote Liberal if rates went up. But 4% of Coalition supporters said that they would be more likely to vote for the Coalition, as did 2% of Labor voters.
Continue reading “Are interest rates a vote changer?”

A tale of two Oppositions

A Galaxy Poll in November last year found that only 33% of NSW voters thought that, based on its recent performance, the ALP deserved to win the forthcoming NSW election, but that nevertheless on a two-party preferred basis 52% of them planned to vote for it (which turned out to be the final result as well).

A Galaxy Poll reported in last Saturday’s Herald Sun asked the same question about the Howard government. It found 44% of those surveyed believed that the Coalition deserved, on performance, to win the election. Despite a significantly higher performance rating than that of the Iemma government, Galaxy found the Coalition behind on the two-party preferred, with 47% support.

What explains why Iemma can win despite poor performance and Howard is likely to lose despite much better performance?
Continue reading “A tale of two Oppositions”

Do people feel worse off?

I only lasted about half an hour with last night’s debate, but early on Kevin Rudd repeated his claim that people are feeling worse off due to rising costs, and the worm climbed to the top of the screen as he did so.

Is this a case of the objective statistics not capturing the subjective experience of the Australian electorate? There is nothing unusual about public perceptions being inconsistent with the facts. But this seems to be a case in which public perceptions are not matching what the same public tells pollsters when asked questions about their finances and standard of living.

For example, the Roy Morgan consumer confidence survey asks its respondents:

Would you say you and your family are better-off financially or worse off than you were at this time last year?

In the most recent survey, 40% said that they were better off and 21% said that they were worse off. The numbers have bounced around a little over the year (it’s a monthly survey), with an average of 36% saying they are better off and 25% worse off. The comparable numbers last year were 33% and 28.5%. This suggests that, compared to last year, more people perceive an improvement over the preceding 12 months and fewer perceive a decrease.

And nor do they seem to think that price increases are going to keep whacking them, with an average of 42% saying that they expect to be financially better off in twelve months time, and 12% expecting to be worse off.

Over a longer time period, a Galaxy poll reported in Saturday’s Herald Sun asked:
Continue reading “Do people feel worse off?”

Good times for ‘working families’

During the week, the relentlessly on-message Kevin Rudd repeated his lines about ‘working families’:

The other big challenge is offering help to working families under financial pressure. Mr Howard just said he understood that, well that’s the same Mr Howard who said that working families had never been better off.

And the ACNielsen poll at the end of the week suggests that the public believes him, with 59% agreeing with the proposition that ‘John Howard has lost touch with working families’.

It’s not often that I agree with Clive Hamilton, or he with John Howard, but the Australia Institute has published some interesting ABS and HILDA-based research on just how well ‘working families’ are doing (as usual with Hamilton’s work, it gets a good report in Fairfax papers).

On average, the real disposable income of couples with kids went up 40% in real terms between 1994-95 and 2005-06, considerably more than the 28% increase recorded across the whole population. There were above-average increases across all the income quintiles for couples with kids, with the lowest gain of 35% in the second-highest quintile. General prosperity and very generous family benefits from the ‘out of touch’ Howard mean that, financially at least, families never have had it so good.

The working families doing-it-tough message is, I think, the key mistake of the Labor campaign. Not that it will harm the ALP’s immediate electoral prospects – to the contrary, it will probably add seats to their likely victory – but it is creating expectations that cannot be met, not even with the me-too tax cuts. Though ‘working families’ will almost certainly on average be even more affluent in three years than they are now, Rudd is fanning such an inflated sense of entitlement that ‘working families’ will be disappointed with their gains.

What does the public want done with the surplus?

Though there are signs that tax cuts are coming back into public favour, two polls published this morning suggest that this is more due to the politics of massive surpluses, which allow tax cuts and more spending, than to a shift back to preferring tax cuts over more public services.

The more interesting poll, for my purposes, was a Galaxy poll published in the News Ltd tabloids. It asked:

On balance, which one of the following would you prefer the Government to do with $34 billion?

And the answers were:

Give tax cuts 12%
Spend it on schools and hospitals 71%
Give more money to states 3%
Invest in some major infrastructure projects 13%
Uncommitted 1%

Continue reading “What does the public want done with the surplus?”

Have the WorkChoices ads made a difference?

For weeks now we’ve been hearing complaints about the level of government advertising, much of it on the changes to WorkChoices. It isn’t having any obvious effect on the two-party preferred. But today’s Newspoll issues survey (pdf) suggests that it is perhaps having some impact.

On the question of which party would better handle industrial relations, the Coalition on 34% is now 7 percentage points above its low point of February this year. As The Australian pointed out, that’s taken them back to where they were before WorkChoices.

So why isn’t it showing in the two-party preferred? Partly, perhaps, because industrial relations is ranked the least important of the nine issues Newspoll has asked about in recent surveys. But the main answer, I think, is that the extra 7% are mostly Liberal voters now less worried about WorkChoices than they were before. Labor has kept the 7-8% WorkChoices advantage it acquired from WorkChoices, with the recent Liberal gains coming from the ‘uncommitted’, ‘none’ and other party columns.

With the Coalition primary vote looking so sorry, the ad campaign may have had a useful political impact for the government (the same can’t be said for the environment ads; the government’s numbers have been flat all year). But it is not a vote changing impact, just firming up Liberal-leaning voters who might be tempted to stray.

Can only a Coalition government deliver Constitutional Reconciliation?

At a press conference on Friday, the Prime Minister implied that only a Coalition government could secure a change to the Constitution recognising Indigenous Australians:

The indigenous people of this country are different from anybody else because they were here first and they have a very special place and I think we have an opportunity to honour that place in a respectful, symbolic fashion by putting something in the Constitution. But you won’t do that unless you are able to unite conservative Australia with the rest of the country and conservative Australia will not vote for something that is built on shame and repudiation.

The SMH reported it more strongly: ‘”I don’t believe Labor could unite conservative and progressive Australia on this issue,” he said.’

Certainly, the record of Constitutional referendums that don’t have bipartisan support is a dismal one. And it is Coalition supporters that are least sympathetic to traditional Aboriginal politics. A Newspoll in 2000 on an apology found that while 60% of Labor voters favoured an apology, only 22% of Coalition voters were in support. The 2004 Australian Election Survey found that 60% of Liberal identifiers thought that land rights had gone too far, compared to 30% of Labor identifiers.

The relationship between voters’ partisan loyalties and their views on issues is, however, not straightforward. Continue reading “Can only a Coalition government deliver Constitutional Reconciliation?”

Will the Coalition offer tax cuts during the campaign?

According to media reports, the Coalition has announced nearly $10 billion in new spending since the May Budget. But will it announce tax cuts during the campaign?

The political case for doing so is strong. The ACNielsen poll on Monday added to the accumulating evidence that tax cuts are heading back into favour. 51% of voters thought that tax cuts should be offered in the campaign, while 41% thought that they should not.

While that is only a small majority in favour, the proportion of potential Liberal voters interested in a tax cut is likely to be much higher. The 2004 Australian Election Survey found that Liberal voters were significantly more likely than Labor voters to prefer tax cuts to more services, and to rate tax as an ‘extremely important’ issue.

It is also an issue on which – consistent with the history of party stereotypes being resistant to contrary empirical evidence – the Liberals remain credible. In both the Newspoll and AES time series Labor is almost always well behind as the party better able to handle (Newspoll) or closest to the respondent’s view (AES) on tax. (Labor last drew even in the Newspoll series in January 1998.)

True, it is unlikely to save the Coalition from a big defeat. But it might help stave off electoral catastrophe. And if Labor keeps matching Coalition promises, it will at least deliver the Liberal constituency something, win or lose on election day.