The Lucky Country, 50 Years On

In the AFR bumper edition, I have a column on the upcoming 50th anniversary of the publication of Donald Horne's classic, The Lucky Country.
Hard to Find Equality in the Lucky Country, Australian Financial Review, 20-26 December 2013

If you could take a one-way trip in a time machine back to 1964, would you choose to do so? Before you answer, recall that your income (accounting for purchasing power) would be less than half what it is today, and your life expectancy at least a decade shorter.

If you’re female, you would face greater sexual harassment and more pay discrimination. If you’re non-Anglo, you would be more vulnerable to violence. If you’re a gay man, sexual activity would be illegal. If you’re Indigenous, there would be pools and pubs displaying signs that said ‘No Blacks’.

And yet there are two important metrics on which things have worsened over the past half-century.

The first is social capital, or civic connectedness. In Disconnected, I tracked a plethora of indicators of the strength of our community ties, and estimated that on many measures, Australia in the 1950s and 1960s was at our most connected.

Compared with the 1960s, fewer Australians now report that they are an active member of any community organisation. A similar picture emerges from tracking membership trends of particular organisations, such as Athletics Australia, the Scouts, Guides, Rotary or RSL. Political party membership has declined, and fewer Australians play an organised sport.

In 1964, nearly half the population attended church on a monthly basis (or more frequently). Today, less than one-fifth of adults are regular churchgoers. We are less likely to know our neighbours, and have fewer friends we can trust with a confidence.

The second change is that we have become more unequal. In Battlers and Billionaires, I crunched the numbers on the gap between rich and poor in Australia, and found that the gap had significantly widened since the 1960s and 1970s.

Over the past generation, the top 1 percent share of income has doubled, and the top 0.1 percent share has tripled. We only have comparable earnings data back to the mid-1970s, but that shows earnings growth of 15 percent (after inflation) for the bottom tenth compared with 59 percent for the top tenth.

Writing of the 1960s, economist William Rubinstein noted: ‘most of the wealthy now eschewed conspicuous consumption and ostentatious display of riches and privilege as politically unwise and economically costly’. Social commentator Craig McGregor observed the wealthy ‘feel under some pressure to be accepted by ordinary working Australians rather than the other way round’.

As an economist, I feel slightly guilty about having written two books that praise the 1960s. This is, after all, an era in which our economy was less efficient, our society was more intolerant, and our foreign policy was more insular.

But the data also persuades me that Australia of fifty years ago was more socially connected and more equal than we are now. The challenge today is not to travel back to 1964, but to find innovative ways of ensuring we build fraternity and equality in today’s lucky country.

Andrew Leigh is the Shadow Assistant Treasurer. His books include Disconnected (2010) and Battlers and Billionaires: The Story of Inequality in Australia (2013).

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