AQ: Australian Quarterly 88.3

Vol 88 Issue 3 JUL–SEP 2017

2017 Special Edition Inequality in Australia i n c l u d i n g : E v a C o x AO

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Prof Frank Stilwell

Redefining Inequality:

‘Not the Economy, Stupid’

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D a v i d H e t he r i n g t o n

Divided Cities, Divided Country

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Jane Sloane & more

Drowning in the Rising Tide: Policy and Inequality

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CONTENTS

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It's the Inequity of Social Trust, not 'the Economy, Stupid'

Prof Frank Stilwell

Prof Peter Whiteford

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Redefining Inequality:

Divided Cities, Divided Countries

IMAGE CREDITS: Please see article placements

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Trends in Income Inequality in Australia

Eva Cox AO

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Drowning in the Rising Tide:

Social Enterprise in Australia:

Policy and Inequality in Australia

The Need for a Social Innovation Ecosystem

David Hetherington

Dr Chris Mason

Dreaming Big Empowerment by Design Jane Sloane

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References

COVER IMAGE: Fotolia © nuvolanevicata

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AQ

a word

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Australian Quarterly

nequality is arguably the catch-cry of our times, but when you pick it apart what does it actually look like in the Australian context? Is it economic, is it political; is it tax breaks for big business, or the everyday homelessness of our capital cities; is it the rot crumbling the sanctified pillar of the ‘Fair Go’, or has it become a convenient catch-all so broad as to be meaningless?

This special edition of AQ exists to try and answer some of these questions, to add some incremental stability to a concept that is fluid and ill-understood.

Leading the charge is the irrepressible Eva Cox, bringing sharply into perspective something that is often forgotten in the cry for change: inequality is a symptom, not the sickness. And so sick is the patient, she believes, that a paradigm shift can be the only, inevitable cure.

Following on, David Hetherington traces the legislative history of income and wealth imbalance in Australia, exploring the inextricable bond between inequality and the vast gains in living standards all Australians have enjoyed post-war. It begs the question: How and when did a hand-up for all become just a trickle-up for some?

And – in what is probably a record – we have Frank Stilwell returning to our pages to tackle an issue he first dealt with 44 years ago in AQ! One of the most visible indicators of wealth is where we live; yet the socio-economic prejudices implicit in these spatial inequalities can have profound effects on people’s lives. Any interventions for a more equal society need to consider how we construct and service the physical spaces of our lives.

We also delve into the social innovation movement in Australia to find out whether Australia’s doing enough to support the new breed of socially responsible business. And, in an empowering piece from Jane Sloane, we meet a group of women that are surmounting the inequalities faced by indigenous women, to create beautiful art and sustainable business.

I hope you find this edition as compelling and important as I have in putting it together.

And you can have your say on the future of Australia at our Facebook and Twitter.

Grant Mills Editor-at-large Notes for Contributors AQ welcomes submissions of articles and manuscripts on contemporary economic, political, social and philosophical issues, especially where scientific insights have a bearing and where the issues impact on Australian and global public life. All contributions are unpaid. Manuscripts should be original and have not been submitted or published elsewhere, although in negotiation with the Editor, revised prior publications or presentations may be included.

Submissions may be subject to peer review. Word length is between 1000 and 3000 words. Longer and shorter lengths may be considered. Articles should be written and argued clearly so they can be easily read by an informed, but non-specialist, readership. A short biographical note of up to 50 words should accompany the work. The Editor welcomes accompanying images. Authors of published articles are required to assign copyright to the Australian Institute of Policy and Science, including signing of a License to Publish which includes acceptance of online archiving and access through JSTOR (from 2010) or other online publication as negotiated by the Australian Institute of Policy and Science. In return, authors have a non exclusive license to publish the paper elsewhere at a future date. The inclusion of references and endnotes is the option of the author. Our preference is for these to be available from the author on request. Otherwise, references, endnotes and abbreviations should be used sparingly and kept to a minimum. Articles appearing in AQ are indexed ABC POL SCI: A Bibliography of Contents: Political Science and Government. The International Political Science Abstracts publishes abstracts of political science articles appearing in AQ. Copyright is owned by the Australian Institute of Policy and Science. Persons wishing to reproduce an article, or part thereof, must obtain the Institute’s permission. Contributions should be emailed to: The Editor at info@aips.net.au

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Editor: Grant Mills Assistant Editor: Camille Thomson Design and production: Art Graphic Design, Canberra Printing: Newstyle Printing, Adelaide Subscriptions: www.aips.net.au/aq-magazine/ subscribe enquiries to: Camille Thomson, General Manager, AIPS, PO Box M145, Missenden Road NSW 2050 Australia Phone: +61 (02) 9036 9995 Fax: +61 (02) 9036 9960 Email: info@aips.net.au Website: www.aips.net.au/ aq-magazine/ Facebook: www.facebook.com/ AQAustralianQuarterly ISSN 1443-3605 AQ (Australian Quarterly) is published by the Australian Institute of Policy and Science.

This project is supported by the Commonwealth Government through a grant-in-aid administered by the Department of Finance and Deregulation.

ACN 000 025 507 The AIPS is an independent body which promotes discussion and understanding of political, social and scientific issues in Australia. It is not connected with any political party or sectional group. Opinions expressed in AQ are those of the authors.

Directors of the Australian Institute of Policy and Science: Leon R Beswick (co-Chair) Andrew Goodsall Maria Kavallaris (co-Chair) Jennelle Kyd Suresh Mahalingam Ross McKinnon Peter M McMahon Peter D Rathjen

Redefining Inequality:

image: © dalelanham-wiki

It's the Inequity of Social Trust, not 'the Economy, Stupid'

Inequality – my thesaurus offers eight synonyms of the word.

Four simply describe it, while four signal negative feelings and perceptions; discrimination, unfairness, inequity, disproportion.

None express inequality as a material or monetary difference, yet these popular definitions are core to the current use of the concept – as offering an explanation for all the problems of the dominant neoliberal paradigm. This use of it, as limited to material inequities, needs to be challenged to really understand the politics of the term in current political debates.

ARTICLE BY: Eva Cox AO

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hen viewed as systemic rather than materialistic, the question then becomes how to interpret the effects of inequality as symptoms of unfair systems – systems that generate antisocial distrust and undermine social cohesion.

The issue is that inequalities may offer multiple symptoms of social destruction, but the contribution these make to feelings of distrust and other emotional reactions, become causal. Ergo, material redistribution, in itself, will not necessarily undo harm, because it is unlikely to

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Article Heading Redefining Inequality

act on behalf of 'ordinary people', preferring to This shift will be a clear rejection support elites in pursuits of of the effects of the current global economic growth. The disildominant globalised market of lusioned coalesce into populist movements, material growth, and the seeking both progressive and regressive. of more localised, protective These may also be undermining forms of governance. the perceived trustworthiness of the necessary complex long-term democratic processes needed to ensure restore trustworthiness, but may be part of representative governance and more civil solutions.

Deconstructing inequality is not easy. societies.

Its materialist version offers a popular and Recognisers of the possible damage of convenient shorthand description for increasing economic inequalities include most current political ills.1 Yet, extending the IMF and World Bank and Davos its meaning is essential, if we are to meetings, which all discuss the issues of seriously analyse the many current political political and social instabilities. However, problems facing most western-style most of those above have touted and democracies. defended globalised market forces, so We need to question why there is are still reluctant to explore, let alone a surprising consensus across a wide recognise, the failures of their globalised variety of institutions, the media, and market modes, and so are resistant to other – even radical – groupings, that the need to do more than some minor material inequality is, in itself, somehow economic redistribution to fix it. primarily responsible for political divides Therefore it behoves us to alert those and distrust in many western democratic still attached to the current flawed and countries. It is blamed for voters’ growing fading paradigm to recognise the volume rejection of centrist parties for failing to of evidence that is suggesting we need to

image: © AdBusters

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explore fundamental changes. If increasing material inequality is mainly a symptom of a wider malaise creating serious social problems, they need to do more than just push for less unequal distributions of material resources. They need to recognise the changes internationally and locally, politically and socially, to show that we are on the cusp of another paradigm shift.

This shift will be a clear rejection of the effects of the current dominant globalised market of material growth, and the seeking of more localised, protective forms of governance.

Some are nostalgic for what are seen as better past times, others may look for better progressive possibilities. Yet they share the desire for futures that address their needs for greater social and political equity, which can make societies more able to address the well being of its people.

Materialism and growing wealth, by themselves, have failed to address these social aspects of life, as the current dominant viewpoints failed to recognise what is core to stable, functional societies.

Therefore they have failed to recognise that the basis of most social and emotional concerns may be triggered by feelings of social exclusion based on perceptions of unfair inequalities.

Humans are essentially social and connected, so the legitimacy of democratic governance structures will depend largely on the quality of relationships that people have with each other and those in the power structures. Current

Drowning in the Rising Tide: Policy and Inequality in Australia

Inequality is a defining idea of our time. Its personalities and memes are buzzwords of the early 21st century: the oligarchs, Piketty, the 1%, the 99%, unicorns, plutocrats, the precariat. Unusually for an economic idea, inequality has captured the public imagination.

ARTICLE BY: David Hetherington

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et despite this newfound celebrity, the contours of inequality are poorly understood. Over the past forty years, inequality has both risen and fallen depending on where you look.

Perhaps surprising, global income inequality - unless otherwise noted, “inequality” in this essay refers to income inequality - has fallen since 1980, continuing a decline that extends back over centuries. The biggest driver of this

fall has been the exit of hundreds of millions of people from extreme poverty in Asia, and in particular, China. In 1988, more than half of China’s population lived on less than US$500 annually. Today more than half live on over US$2,000 a year. So at the global level, inequality continues its long-term decline.

But the public in Australia, and other developed countries, perceive that inequality is on the rise. And they are right: within rich countries, inequality has increased markedly. This is particularly the

image: © M van Ree-Flickr

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Divided cities, divided country

Divided Cities, Country The inequalities between people according to where they live are well known in Australia. Very wealthy households congregate in areas like Sydney's Mosman and Vaucluse, Melbourne's Toorak, North Adelaide and Perth's Peppermint Grove and Dalkeith.

Poorer households inhabit whatever places they can afford with their lower incomes, commonly towards the urban outskirts where land and houses are cheaper but transport more difficult and local services more meagre.

ARTICLE BY: Professor Frank Stilwell

Then and now: Social Inequality It was 44 years ago that Frank Stilwell first wrote for AQ on the topic of Spatial Inequality. To see how much (or how little) has changed, AQ is making Frank’s 1973 article available to read! Head to www.aips.net.au/aq-magazine/current-edition/ to download.

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longside those well-established urban inequalities are the equally long-standing divisions between ‘the city’ and ‘the bush’ (the latter, of course, having its own huge contrasts between country towns, rural areas, remote and very remote regions).

In practice the socioeconomic pattern is a complex mosaic rather than a clear spatial dualism. Yet it is equally the case that economic and social inequalities are structural and deeply etched into the Australian socio-economic landscape.

Divided cities, divided country

As the radical urban geographer David Harvey has argued, the rich command space while the poor are trapped in it.

opportunities may be poor. Seen from a conservative perspective, markets for land, labour and capital facilitate the most efficient geographical outcome, allowing people to locate where they choose and where they can afford, given the prevailing distribution of income and wealth.

A more critical political economic viewpoint draws our attention to the systemic factors that reproduce and amplify the spatial inequalities. This brings people’s different class positions, occupations and incomes into the spotlight. More than that, it draws attention to the vicious cycles that commonly intensify inequalities once they take a spatial form.

In the academic literature these are what are known as ‘processes of circular

and cumulative causation’.1 They cause spatial inequalities, both within the major metropolitan areas and between city and country, to compound the inequalities that originate from people’s different socioeconomic positions. They also inhibit remedial redistributive policies, because the wealthiest people, with the strongest vested interest in maintaining the status quo, also have the strongest influence over political processes. As the radical urban geographer David Harvey has argued, the rich command space while the poor are trapped in it.2

IMAGE: IMAGE: © Insert Diliff-Wiki

Does it matter? Some say not, arguing that geographical or spatial inequalities are simply the result of personal choices.

From this perspective, the spatial inequalities we observe are simply the outcome of where people are born and where they choose to live, taking account of job opportunities, housing costs and transport facilities. Within the capital cities in particular, housing prices act as a very severe sorting mechanism, as median prices in Sydney and Melbourne climb over a million dollars.

It may be conceded that geographical inertia is a big factor too: people commonly stay in the locality of their origin, to be near to family and friends, even though the local economic

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Social Enterprise in Australia: The Need for a Social Innovation Ecosystem

How do we respond to growing inequalities during times of an increasingly fragile global outlook? Such questions have become more important in our lives, and the need to respond to them has intensified, as economic, social and political frictions are felt closer to home.

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or example, reductions in government funding for essential services, many of which deal directly with social and economic inequalities, often require organisations to do more with less. Certainly, not too long ago, the Australian federal government used (and quickly dropped) innovation to frame how the country’s ‘ideas boom’ would help guide all Australians to a more prosperous economic future. The importance of innovation to help tackle long-term social

inequalities was less clear.

Indeed, any innovation ecosystem that lacks proper, coordinated investment makes the task of delivering long-term equality even harder. For organisations on the front-line of service delivery – those working with individuals and communities affected by complex challenges – reductions in funding and marketisation of their services, apply severe pressure on their ability to serve communities.

Understandably, given these constraints, some existing providers and community

ARTICLE BY: Dr Chris Mason

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Trends in Income Inequality in Australia For many years, Australians have liked to think of themselves as egalitarian, and for much of our history we believed our income and wealth was spread around evenly. And for many years, the world also shared that view.1 As early as the 1880s, visitors remarked on Australia’s relatively equal distribution of wealth, the lack of visible poverty, the country’s generally comfortable incomes and its relatively few millionaires.

ARTICLE BY: Professor Peter Whiteford

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s late as 1967, prime minister Harold Holt could say that he knew of no other free country where “what is produced by the community is more fairly and evenly distributed among the community” than it was in Australia.

From the 1980s onwards, however, this view of Australia came under increasing

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