I’m from the Government, trust me!
This old piece of cynicism holds much truth. The good intentions of government can create as many calamities as they do genuine solutions. Some policies have a short-term impact, others a long lead-time before their consequences become apparent.
Take Bill Clinton’s well-meant decision to relax regulatory controls over the US financial industry. Few bother to connect the dots with that particular policy and the collapse of Lehman Brothers leading into the GFC but the connections are real nonetheless and should be etched in history with a bold straight line.
Likewise Richard Nixon’s decision to free the US from the restrictions of the gold standard. It was a heyday for the Keynesians. US debt has since burgeoned as the Fed electronic printing presses started rolling thereby turning the US Government into the greatest debtor in world history and fuelling the current bubble in US stock prices, yet more calamities just waiting to play out with ultimate consequences for which we will all pay a price. The dots are there to be connected for anyone willing to look.
We in Australia are not immune to similar well-intentioned government policies.
One of my favourites is the Commonwealth super scheme. The Whitlam Government pump primed this with prescribed benefits in its rush to make Canberra the social laboratory of Australia. While I’m a fan of many Whitlam initiatives and greatly admire Mr Whitlam himself (he launched one of my books), this was not one of his better policies. His and subsequent governments just forgot to fund the scheme until Peter Costello ultimately bit the bullet by selling off great chunks of Telstra to create the Future Fund (which should really be called the Past Fund) to pay for it. Somewhere around $40 billion in public assets were thereby ransacked for the personal benefit of a select group of individuals who now live among the most lavish of publicly guaranteed lifestyles of anyone in Australia all thanks to the single greatest act of public wealth destruction and transfer to private hands in Australia’s history.
What does this have to do with my theme of disaster management? Quite a lot.
Whether or not you agree with the ownership or sale of Telstra by any government, the destruction of such great public wealth places consequent constraints on the ability of government to use those assets for the benefit of genuinely deserving people. In this regard, I point you to the National Disability Insurance Scheme as a model of government policy worthy of serious and wider consideration.
To give birth to or suffer from a traumatic disability is no less an economic calamity for the community as it is a personal tragedy for any individual or family. It is, in short, a disaster. The costs are enormous for everyone due as much to lost economic opportunity as to the trauma of caring for individuals unable to fully function by their own means. We should all be sympathetic to the plight of those individuals and families directly affected. The NDIS will be a great blessing to them.
The sale of Telstra, had its assets been directly transferred to the NDIS, would have given the NDIS an immediate and assured financial base from which to operate. We as a community would all have benefited. It would, as the scheme’s name suggests, have addressed an area of considerable risk through a proactive insurance model for which we would have all made a down payment in advance through the sale of Telstra instead of relying on the reactive vagaries of public handouts through some form of government entitlement later on.
While the Telstra horse has pretty much bolted, perhaps the proposed Medibank sale could be seen as an opportunity not to be missed in funding the NDIS. At least the money would go from one form of health insurance to another, and the beneficiaries would be people facing serious trauma instead of a select group of retired public servants supposedly entitled to live the life of Riley through the charity of the wider community who actually paid to build Telstra in the first place.
This is the fourth article in a series entitled The Disaster Blogs.
PHOTO CREDIT: NDIS Rally, Brisbane, 30 April, Image: Spinal Injuries Association.