A1 | CHAPTER ISBN: 978-0-9808356-2-5 Published by Centre for Policy Development. PO Box K3, Haymarket NSW 1240 Some rights reserved. First published in 2013. Cover design and illustrations by Fiona Katauskas Design and layout by Jemima Moore. Set in ITC Cheltenham and Interstate. As the publisher of this book, the Centre for Policy Development wants our authors’ work to be circulated as widely as possible. This work is therefore licensed under a Creative Commons Attribution 3.0 Unported Licence. Extracts, summaries or the whole publication may be reproduced provided the author, the title and CPD are attributed, with a link to our website at http://cpd.org.au. For more details on the Creative Commons Attribution 3.0 Australia licence that applies to this publication, see http://creativecommons.org/licenses/by/3.0/au/. A2 | CHAPTER edited by Miriam Lyons with Adrian March and Ashley Hogan A2 | CHAPTER A3 | CHAPTER ACKNOWLEDGEMENTS he editors would like to express our immense gratitude to everyone who helped us produce TPushing Our Luck — there are so many who contributed in so many different ways. We would like to thank everyone who read drafts, provided statistics, talked through difficult arguments and provided both literary and moral support. We cannot thank Jem Moore, the CPD’s General Manager and Abi Smith, our Communication Manager, enough. Jem’s design talents and Abi’s keen eye for copy were amazing behind the scenes. This book could not have been produced without their help. We would to like to thank Fiona Katauskas for providing excellent cartoons which really capture the essence of the book. Our intern team at the CPD, Julia Hosking, Anika Jardine, Nicola Moore, Ben Clark and Owen Nanlohy were invaluable in lending a hand wherever required and with their unlimited enthusiasm for the project. Many thanks to all those who took time to review chapters of the book: Matt Cowgill, Greg Smith, Anand Kulkarni, Dean Ashenden, Mark Burford, Paul Gilding, Ben Pearson, Lisa Fowkes, Laura Eadie, Amy King, Melissa Sweet, John Menadue, David Karoly, Malte Meinshausen, Ian Dunlop, Daniel Wiseman, Adrian March, Claire Denby, Sarah Maddison, Andrew Jacubowitz, Georgie McClean and Dan MacKinlay. All conclusions and any errors that remain are the authors’ and editors’ own. Thanks above all to the contributing authors for your insight, effort and patience! Many, many thanks to those who have financially supported the Pushing Our Luck project so far, through our crowdfunding appeal or offline. Names of the generous people and organisations who contributed to this project can be found at: http://cpd.org.au/2013/09/thank-you/ A4 | CHAPTER CONTENTS INTRODUCTION ............................................................................... 2 by Miriam Lyons ONE Chipping In: Paying for a Good Society ...................................... 17 by Adrian March, Miriam Lyons, Adam Stebbing and Shaun Wilson TWO Getting past Gonski: every child deserves a good school ................. 42 by Chris Bonnor and Jane Caro THREE Getting better: Prescriptions for an ailing health system ............... 58 by Jennifer Doggett FOUR Putting society first: welfare for wellbeing ................................. 71 by Eva Cox FIVE After the boom: where will growth come from? ............................ 85 by Roy Green SIX Taking the high road: a future that works for workers .................... 99 by Lisa Heap SEVEN Life after luck: building a more resilient economy ........................ 116 by Ian McAuley EIGHT Climate change: reconnecting politics with reality ....................... 138 by John Wiseman NINE Welcome Home: Preventing the next culture war ......................... 156 by Lindy Edwards TEN The Vision Thing: We need a national plan .................................. 170 by Geoff Gallop A4 | CHAPTER 1 | INTRODUCTION he 2013 election season felt disturbingly familiar Tto anyone who was paying attention back in 2010. One Prime Minister replaced with another on the back of bad polling? Check. New Prime Minister then waters down a controversial tax and creates a big hole in the budget? Check. Last-minute plan to stash asylum seekers somewhere out of sight and off the front pages? Done. Opposition leader promises to axe the tax, stop the boats, and balance the budget, then makes those same promises, over and over again? Yep. This may seem like a strange time to be publishing a book of progressive ideas. Our public debate is not a civilised contest over policy options but a bare-knuckle boxing match between populist politicians, and the outcome of the 2013 election suggests that the tide is turning against attempts to put long-term social goals ahead of short-term individual ones. But the contributors to Pushing Our Luck argue that, despite appearances, we have not yet reached the peak of Australian progress. Building a society that is more fair, sustainable, prosperous and cohesive than the one we live in today is not just a nice idea, but an achievable one. The title of this book is both an invitation and a warning. An invitation to take the courageous steps necessary to make a good country into a great one, and a warning of the consequences of coasting on the back of past achievements. The fear that Australia’s good luck will run out if we push it too far can be so paralys- ing that we fail to make the most of it. The following chapters show that, in many cases, we’re running down our inheritance, neglecting public assets that took decades of cooperation and hard work to build. We’re drifting towards two-tier systems in health, education, welfare, and workplace relations. Australians have never been asked if we want to prioritise the wellbeing of the wealthy, healthy and highly skilled and leave everyone else on the margins, but that is where we are headed. The authors of Pushing Our Luck show that a different approach would have many practical advantages and could attract strong public support. They also spell out what’s required to make our good fortune last well into the future. Australia is one of the most prosperous countries in the world. We rank near the top of the United Nations’ Human Development Index, based on our levels of health, education and income.1 The Economist Intelligence Unit rates Australian newborns as the second-luckiest babies in the world.2 It’s time to decide what to make of our status as the rich kid on the block. Do we want to be the world’s Gina Rinehart – eyes only for the next quarry, squabbling with the kids over the inheritance, lecturing those less fortunate on why they deserve their fate? If our nation were on its deathbed, with the extended family gathered around, what would we be proud of, what would we regret? Would we be passing on a rich legacy, like Norway, or would we have frittered it all away, like Nauru? Would we wish we’d spent more time and effort on the things that really matter? 2 | INTRODUCTION We’ll all be rooned, said Hanrahan Meet Sergio Munoz. He has been job-hunting for over nine months: ‘If you go to an interview, there are another 1,000 people who want the same position as you… You have to be a God to find work in Spain.’ Munoz, who is 25 years old and has a degree in chemical engineering, is one of 6 million3 unemployed people in Spain, where one in two young people and one in four4 of the total population can’t find work. Italy is in a somewhat better position with unemployment around 40 per cent for young people and 12 per cent overall.5 In Greece the economy is now 20 per cent smaller than it was in 2007,6 and a 200 per cent increase in HIV infections and the first malaria outbreak for decades have been blamed on budget cutbacks.7 Unemployment has settled in at just under 8 per cent in the United Kingdom8 and has edged down to 7.4 per cent in the United States.9 As noted in Chapter 1, the economic impact of unravelling financial markets was greatly worsened by the austerity policies imposed by governments and institu- tions that had forgotten the lessons of the Great Depression. Only recently have the International Monetary Fund and the German government remembered their Keynes. For all his flaws, Australia is very fortunate that Kevin Rudd was in power with the Global Financial Crisis hit, and took Treasury Secretary Ken Henry’s sensible advice to implement a well-designed stimulus package. It used to be said that when America sneezes Australia catches a cold. As the global financial crisis took hold, America and much of Europe came down with swine flu and Australia got a mild case of the sniffles.10 Our economy has had 22 years of consecutive growth, and unemployment, inflation and interest rates are all relatively low. Three in four Australian adults are on the global rich list; counted amongst the world’s top ten per cent of wealth owners. Australia has the third-lowest public debt in the developed world, and economic growth has outstripped that of most other developed countries for over two decades. The average net disposable household income in Australia is the fifth highest in the world,11 and we have the have the highest minimum wages in the world. But we seem to be suffering from a sort of reverse anorexia. The fatter Australia’s economy gets, the more Australians talk as if we’re starving to death. As Ian McAuley notes in Chapter 7, there is a big gulf between the views of Australians who answer surveys on consumer and business confidence and the views of economists in the International Monetary Fund, the OECD and ratings agencies. People coming home from their travels in Europe or the United States now arrive with a sense of shock at just how far Australia’s position has diverged from the rest of the Western world, and how little gratitude we have for our good fortune.