Postcode : the splintering of a nation by Wayne Swan is a book that is interesting to look at because the author is now treasurer. The book is about inequality in Australia and in particular Swan’s allegation that it has become worse under the Howard government. The book was largely written when Swan was the shadow minister for family and community services. The book is worth reading in order to see what Swan was thinking aout and how he was thinking before he became shadow treasurer.
The book has 7 chapters, an epilogue and two appendixes
Introduction – what’s happening to the fair go
Postcodes of inequality:
A patchwork nation
The splintering middle and the debt pioneers
Whatever happened to welfare reform
The consequences of inequality
Mapping a future for all
Epilogue – postcodes and politics
Letter to the Prime Minister
10 Ways forward
Inequality and income redistribution are very interesting topics. The extent to which states should redistribute income for better economic outcomes and for moral reasons is a very deep topic about which there is considerable debate and disagreement. Swan doesn’t discuss this. Instead he simply states that there is far larger inequality in Australia and something must be done about it.
The book puts forward the line that under the Howard government inequality in Australia has become worse and the years of prosperity have been very unequally shared and that the Howard government has been the cause of this rise in inequality. The book does not compare Australia to other countries and hardly looks at another very important part of income inequality, that of how income change and mobility and inter-generational income mobility. The excellent “How Australia Compares by Rodney Tiffen and Ross Gittins provides an overview of how Australian rates of poverty compare to other countries and how their changes compare to other countries. What it shows is that income inequality was increased across the Western World over the past 20 years and that Australia has seen the same trends. Swan doesn’t mention this. He also doesn’t compare the change in inequality rates during the Hawke and Keating governments to the changes during the Howard government.
Swan looks at the different incomes amongst different postcodes. This method of looking at Socio-Economic-Status (SES) is known to be flawed as there are a number of postcodes in Australia where inner-city government housing is combined with very expensive housing. Swan notes this, but this didn’t stop him naming the book postcodes.
The book frequently slips into damnation of the Liberal Party and anything it does. Swan sees the 2004 election as having been lost not because the ALP had an inexperienced leader who politically outplayed but rather as one where the Liberals ran a terrible campaign based on fear and lies. Swan shows that perhaps his main belief is really a tribal one where ALP good Liberal bad. It’s not a good look.
The book drops references to a fair amount of research on rates of poverty. Swan has at least read on his subject. However, he can’t help himself when mentioning Peter Saunder of the CIS and slanders and misrepresents him a number of times. Saunders is interesting in that he is a Right Wing researcher who looks at poverty and inequality. Swan clearly thinks Saunders is the devil.
Swan repeatedly mentions the high marginal tax rates for people on low incomes. This is clearly true, Swan also mentions that he realises that the reason Australia has high marginal tax rates for people on low incomes is because we have a tightly focused welfare system that allows Australia to spend fairly low amounts on welfare but makes it go to the most needy. Swan doesn’t mention that much of the targeting was introduced by the Hawke / Keating government. It’s a tough problem that Swan suggests could be solved by not reducing payments, i.e. by removing the targeting. He doesn’t mention that this would drive up costs.
Swan repeatedly mentions ‘The Australian Way’ which is a nonsensical concept in the tradition of incentivisation, mateship, nation building and working families that are beloved of Australian politicians. Perhaps we will see a future ALP campaign based around ‘The Australian Way’.
Swan’s book is not terrible, but it isn’t great either. It’s hard to work out why it was written. It’s unlikely to convince anyone who was unsure about Swan or the ALP that they have great answers and it provides very little or no insight. It is useful to read because it gives a look into the mind of Australia’s treasurer before he was in the national spotlight. He clearly thought that inequality was a big problem in Australia and something had to be done about it. It’s also interesting to read because it shows that what Swan was spending time thinking about before he became treasurer bears little, if any, resemblance to what he has done while treasurer.