Opinion Pieces

The Australian Dream, is it still alive?

November 20, 2020

The Australian dream of owning your own home seems unattainable these days, certainly in places like Sydney and Melbourne. In the 1990s first homeowners had spent a year saving for stamp duty alone. Today, they must save for two and a half years, with the time taken often seeing them lose the change of realising that Australian dream.

 

Here are some of the things that I am trying to address in our community: increasing homelessness, inter-generational wealth inequality, opportunity inequality and cycles of poverty.  Not to mention that part of the Australian dream has been to own your own home. 

 

I know there are many people who I will never be able to change the mind of when it comes to social housing. Indeed, 15 years ago I would have made most of the arguments of those opposed to social housing. However, since then because I cared about the less privileged in our nation I studied and researched policy approaches to reversing the above trends.  The numbers are incontrovertible, broad social housing (as opposed to support housing which tends to get thrown in) has made things worse. 

 

Now you may wish to call me paranoid, and say I do not refer to facts, allow me to say however in response that while Australia's income inequality is at a 75 year low according to the Treasury, the RBA and the Productivity Commission, wealth inequality has grown. This is connected to levels of home ownership which have been falling for every generation since the 1970s. There is a direct correlation, and many argue causation.

 

I care about each and every Australian being given a fair go through equality of opportunity and a freedom to choose how they want to live their life. As a member of the House of Representatives, my humanity should not stop at the borders of Mackellar. Afterall, it is my job to further the Australian dream for all Australians, not just those in my electorate.  

 

According to St Vincent’s there are a number of reports indicating short falls in various forms of social housing totalling 500,000.  The Victorian Government is building 9,300 for $5.3 billion.  This hardly touches the side.   At that cost, building 500,000 public houses would total $285 billion.  Imagine how much transport infrastructure and land release could be procured for that amount?  It would materially shift housing affordability in Australia for this generation and the next, and provide at least a decade long stimulus. 

Jason Falinski MP

 

Therefore if this is a stimulus package, it is a pretty sub-optimal one. Most state governments would be better off releasing land and reforming planning laws to allow all Australians to have access to their own home.  If the $5,3 billion had been spent on transport infrastructure and land releases the amount of housing that could have been built would have been substantially higher, the stimulus would have been higher, and the number of people who would have had the security of their own home would have been much higher. 

 

We live on the least populated continent in the world where if you earn average weekly earnings you are among the highest 2 percent income earners in the world, yet people cannot afford to buy their own home.  Generational home ownership has been falling for the last 50 years.  We have some of the highest land prices in the world outside Hong Kong and Singapore.   This is unfair, and the result of poor planning laws, credit restrictions and government charges and approval processing. 

 

In the mid 1990s the Japanese government commenced one of the world's largest public housing construction programs to get their economy moving again after the 1989 crash.  It did not result in economic growth, and it did not materially reduce homelessness.  Five years later, as reported in the Economist, the Tokyo local government undertook broad ranging planning law reform, from 2002 to 2012 homelessness in Tokyo reduced by 80 per cent.  I believe the lessons are clear. 

 

All of us can learn much from history, including me.  Given my family's history in escaping communism after World War II I have a particular view of socialism and am probably overly sensitive to policies that result in citizens of any nation having their freedom restrained through denial of private property and their reliance on state services increased.  Therefore, my clear preference, including for all the reasons above, is that governments work to increase people's access to their own homes and not rely on the government for shelter.

 

I do hope all Australians share the same public policy goals of reducing poverty, breaking cycles of inter-generational welfare, reducing homelessness, and ensuring that everyone has access to the Australian dream.  I know that many who believe social / public / community / support / crisis housing is the only way to address these problems find the above facts unpersuasive, and that is fair enough as often there are a lot of different things going on at once and trying to proscribe a given outcome to one action can be misleading. 

 

That is correlation is not the same as causation.  However, I would hope that the facts do give all of us pause for thought that it may be time to consider alternative approaches because what we have been doing for the last 70 years has not shifted the dial and in many cases has made things worse.  

Jason Falinski MP is the Federal Member for Mackellar.

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