Australian right a dumping ground for failed US ideas
It’s been obvious for quite a few years that the Australian rightwing commentariat takes most of its ideas from the US Republican party. A more recent development is that they seem to be importing ideas that have already failed in their home country. I mentioned Voter ID recently. My Twitter feed has also been full of factoids along the lines “48 per cent of Australians pay no net tax”, being pushed by Miranda Devine and others. Obviously these are derived from the “47 per cent” line made famous by Mitt Romney in 2012 . We all know how that went for Romney, and of course we also know what’s wrong with the factoid. I’ll talk a bit more about the specifics over the fold, but it’s worth asking what’s going on here.
The most obvious point is that the Australian right hasn’t had any new ideas in 30 years or more. Everything in the recent Commission of Audit report (a more coherent version of the ideology reflected in a distorted fashion in Hockey’s Budget) could have been (and often was) taken from the 1996 version, and everything in the 1996 report could have been found in documents like Wolfgang Kasper’s Australia at the Crossroads published in 1980, and similar documents. Everything useful in this set of ideas was implemented decades ago: what remain are the items that are either permanently untouchable in political terms (eg road pricing) or unworkable for one reason or another (eg handing income tax back to the states).
So, it’s scarcely surprising that they need to import from abroad. But the US Republicans aren’t in any better state. Their big causes a decade ago were the culture war (primarily equal marriage which was seen as wedging the Democrats), climate denialism and the Global War on Terror, which was transmuted into the invasion of Iraq. Most of our current rightwing commentariat (Bolt, Blair, Devine etc) cut their teeth on this stuff, and have never really outgrown it.
The Repubs are now in a state of complete intellectual collapse, unable to produce a coherent position on anything, from immigration to health care to budget policy. They survive only on the basis of tribal hatred of Obama. Since that doesn’t sell well in Oz, the local right is forced to live on discredited failures like Voter ID and “
47 48 per cent of the population are takers”.
It’s the combination of tired economic rationalism and imported tribalism that makes the Abbott-Hockey such a mess, and the efforts of its remaining defenders so laughable.
Turning to the specifics of the 48 per cent factoid, the problems are essentially the same as with Romney’s original 47 per cent.
First, the factoid considers only income tax, disregarding GST, payroll tax, excise tax and so on. So, it implicitly overstates the contribution of high-income groups who, by definition, pay more income tax.
Second, since revenue is equal to expenditure  in the long term, Australians receive from government, on average, the same as they contribute, whether the benefits take the form of cash transfers or publicly provided services. Assuming that total tax payments are proportional to income, and that everyone gets about the same benefit (both of these are pretty good approximations), people receiving more than the arithmetic mean income will mostly be net contributors, and those below will mostly be net recipients. And, since the distribution of income is skewed to the right, the mean is greater than the median, which means that, when everything is taken into account, most people will be net beneficiaries from the tax-expenditure system. The minority of net contributors (that is, high income earners) are of course precisely the people who benefit most from the social order as a whole.
Finally, it’s worth observing that this line totally contradicts both past Liberal policy (which has encouraged taxation concessions for families) and rhetoric about “middle-class welfare”, which implies precisely that things like Family Tax Benefit should be confined to those in the lower quantiles of the income distribution.
fn1. It was actually developed a bit earlier, in response to the Occupy movement’s focus on the 1 per cent, by the appalling Erick Erickson of Redstate)
fn2. Please, no quibbles on this point. I promise a long post on concepts of budget balance when I get a round tuit.