Jan 062013
 
Australian business and the nanny state

It’s becoming popular to describe Australia as a ‘Nanny State’ as governments respond to moral panics and the need to do something about anything from bicycle helmets to unpasteurized cheese.

Unquestionably Australia has changed in the last quarter century as governments of all persuasions have found it easier to legislate rather than lead. This has had effects on business and society in general.

A good example of how the regulations have built up over the last twenty years in Australia is a sign at my local beach.

the Australian nanny state is shown in signs at balmoral beachThat’s a fine welcome and it compliments the $7 an hour parking fees the local council levies. In itself, those parking fees are a good example of the price pressures driving Australia’s high cost quandary.

Drinking on Sydney ferries is banned in Australia's nanny state

Possibly the saddest regulation is the alcohol ban on ferries. Twenty years ago it was normal to see a group of friends unwinding on the way home from work with a cold beer or wine. Today you can’t do that because some bureaucrat decided drunks were a problem and rather than enforce existing laws it was easier to ban drinking entirely.

The press and moral panic

Much of this nannyism is being driven by the media who drum up hysterical reports demanding ministers do something. In turn the government’s panicky PR obsessed apparatchiks respond with pointless and unnecessary laws and rules. Often duplicating those that already exist.

A good example of cynical media hysteria was the story of Malea, a Sydney mum minding her own business while legally cycling with her child in a trailer.

While out riding a discredited journalist filmed Malea and passed the footage onto a current affairs TV show which portrayed her as a reckless mum and demanded such behaviour be banned.

Fortunately in that case the politicians ignored the confected outrage, but that’s the exception rather than the rule.

Doing something

The media though doesn’t have to force Australian politicians into adopting the nanny reflex. Often governments will create their own outrage in order for attention deprived politicians to get press coverage.

A good example of this was the incompetent Carr government which decided its contribution to the War On Terror after the 9/11 attacks would be to turn the Sydney Harbour Bridge into something similar to what welcomes Guantanamo Bay detainees.

The Australian nanny state is shown by the Sydney Harbour BridgeIt’s worthwhile comparing the same view on San Francisco’s Golden Gate Bridge and ask which is the greater terrorist target?

San Francisco's Golden Gate BridgeWhen Sydney genuinely was a larrikin city, climbing the Harbour Bridge in the dead of night was a rite of passage. Today, if you can get around the security guards, barbed wire, CCTV and motion detectors you risk a $3,300 fine and being branded a terrorist.

If you try to climb the bridge and get caught, the fine is only half that of stepping on the hallowed turf of the Sydney Cricket Ground.

At the cricket, if you’re foolish enough to bounce a beach ball, start a Mexican Wave or sing out of tune and you’ll be out before you can say “Shane Warne is a safe driving ambassador.”

The Age newspaper gave a good example of Australian sports administrators’ Stalinist mindset in this fawning article which gloats over the efforts MCG staff go to in harassing their customers.

On level three of the Members’ wing is a secure room with the best seats in the house, although the occupants only manage an occasional glance at the game on hand. It is the MCG command post, where ground security, police and Securecorp officers constantly watch a bank of computer monitors and camera screens.

Dohnt says the camera operators will check the froth on a punter’s cup of Coke to see if it has been topped up with smuggled grog.

Forcing cricket fans to buy overpriced drinks or visitors to spend over $200 to climb the Harbour Bridge brings us to the core motivation behind many of Australia’s nanny state regulations – protectionism.

Hidden protectionism

Many Australian Nanny state rules are to protect businessThis sign, which is attached to the back of the one at the beginning of this story, bans vendors who sell from boats. It’s questionable whether the council actually has the power or resources to enforce this ban but if it helps the local shopkeepers then so be it.

One of the hubristic traits of Australian exceptionalism is that the nation is a ‘free trade’ economy hard put upon by sneaky Japanese, American and European protectionism. The reality is Australia is just as good as Japan or the EU in introducing sneaky regulations to protect the well-connected locals.

A very good example of this is bananas where the Australian domestically produced product is substantially dearer than imported bananas sold in the US, UK or Europe.

In early 2011, Cyclone Yasi devastated Australia’s banana crop and prices soared. Not one imported banana was allowed in to ease the shortage. Remember that the next time you hear a politician or journalist boasting about Australia’s free trade credentials.

business is hurt by nanny state rules

Banana prices are another example of the costs passed onto Australian households and industry through nanny state regulations. Compliance costs are real and add to the cost of production and employment. They are another reason why Australia has become a high cost economy.

More importantly, those regulations tend to favour incumbents making it harder for entrepreneurs and new entrants into markets making the economy even less flexible.

The burden of regulation is also unfairly dropped upon the smaller business who don’t have the resources to comply with or challenge unfair rules. The Howard government was very good at this with slapping small business with the responsibilities of raising the GST and complying with draconian laws like Workchoices.

At this stage it’s worth noting that the Australian nanny state isn’t a Labor party creation, it’s come from both sides of politics and often because poorly drafted laws require mountains of regulations to overcome the legislative flaws.

Workchoices was probably the best example of badly thought out laws where the Howard government panicked into slapping a whole level of punitive rules for businesses who failed to keep log books of staff hours worked – the legislation was so bad that had it not been repealed by Rudd, the sight of bundy clocks would have become common in Australian offices.

Nanny and risk

One of the unfortunate effects of the nanny state is that it saps the entrepreneurial spirit – why take risks when nanny is there to support you?

There is an unintended effect of this though – because we think nanny will always protect us we lose the ability to evaluate risk.

Where this is most obvious is in financial matters. Too often people are fooled into investing in dodgy schemes because they think that regulators will protect them. They find out this isn’t the case when the money is long gone.

That failure to understand risk though becomes pervasive through the community as the nanny state mentality becomes established. We could argue that inability to identify risk was the core reason for the global financial crisis.

The future nanny state

While the nanny state has been rampant around the world for the last fifty years, its days are numbered as cash strapped governments find they can no longer bear the cost of maintaining armies of bureaucrats to enforce silly rules.

As society deleverages from the excesses of the credit boom, governments are going to find revenues falling short and while it won’t be the first casualty of the new austerity, the nanny state will almost certainly be a victim.

  21 Responses to “How Australia’s nanny state hurts business and society”

  1. Paul, 

    You’ve surpassed yourself with this one. Absolutely nailed the issue.

    The saddest thing is that the many examples you’ve given of both nannyism and its oftentimes inadequacy to actually achieve the outcome for which it was intended, are not isolated.

    I blogged about Australian barbecues a while back, which summed up the now bourgeois nature of a once-frontier nation.   http://thenewaustralian.org/?p=140

  2. Actually you’ll be surprised TNA how many people kit out their McMansions with those mega outdoor barbecues. They are pretty common in the burbs. In my experience it’s the same demographic who own performance utes with personalised number plates and f*** off we’re full bumper stickers.

    We’ll have to don hi-viz vests, bicycle helmets and mouthguards and duck down the Four Pines to discuss this further.

  3. February; I’m dry this month!

  4. Hey! Your forgot to defend our right to carry hidden firearms everywhere. Damn the nanny state. And I’ve always believed that people should be allowed to distill arak themselves, what’s a little methanol between friends. And don’t me started on the banning of indoor smoking at restaurants. I miss the way my clothes held the smell of smoke, it was a lovely reminder of my fun evening.
    Or perhaps you are just selectively sampling some policies you in particular don’t like. If only we could invent a way of mediating such disputes. Imagine a world where these policies were implemented by elected governments.

    • Nice work conflating a bunch of different issues Tim.

      I’ve cut the list short, there are thousands of unnecessary rules and laws enacted with little thought and no consultation. Many of which, like the ferry drinking ban and the South Australian hens night prohibition, are adequately covered by existing laws.

      These add to costs and do nothing to make our society safer or more polite.

      It’s fine to talk about elected governments but as we both know this urge to pass regulations is bipartisan and, once enacted, few of these rules are repealed.

      As a society have lumbered ourselves with a mess of regulations which we don’t understand. The real pernicious part of that is that the regulators themselves often don’t understand the rules either as we see with Centrelink and the ATO constantly being caught out.

      I’m not making a Libertarian argument that we need no rules, but that we need sensible thought out regulations which have been publicly debated before they are enacted.

      Right now we have too many pointless and unnecessary rules and it’s constricting our society.

  5. Who’s Tim?

  6. Paul,
    Nailed it in one.
    All 3 levels of government have this ability to control, manipulate & guide us in whatever fashion that suits them ( guide is said tongue in cheek )
    They have every cunning little trick up their sleeves to further rip us off in the interest of them selves, but on the pretext of doing it for the wider communities betterment.
    Hidden agendas are alive and well. especially in the biggest sand pit.
    To think that many voters hold politicians in high regard, some even think of them at the same level of a movie star. How misguided can one get.
    What the hell for, they get out of bed and go for a ………… ( toilet visit) every morning just like you and me.
    They are no better than us, they are just pigs with their snouts in the trough.
    An over simplistic view, but the very few good politicians are brought into line so yhe party can sink to the lowest level.
    Mind you I think my old man was right. The worst Liberal Government is better than the best Labor Government. But that’s another topic.
    Paul for PM

    Russell

  7. Hey Tim,

    Have you ever worked in a government department (or a company fully-dependent on government revenue)?

    Waste, inefficiency, incompetence, bureaucracy and sloth are early punished in the same ruthless way that the private sector would, with its reliance on pleasing the market.

    If there’s a way of achieving an outcome that is simple, cost-effective and elegant, don’t look to a civil servant to find it.

    Witness; the Sydney Harbour Bridge anti-terrorism measures. About 18 months ago, a really devious father complaining about parental rights managed to evade the security cameras, new prison camp railings and security guards and closed the bridge for the morning by climbing it.

    How? He got up an hour before the security guards started work. Sneaky, eh?

    Thank goodness Al Qaeda won’t think of that clever trick. 

  8. Typo; not “early” but “never” punished.

    Thanks iPhone.

  9. Further to my reply to Tim, here’s a terrific Smart Company expose on how the ATO misuses the law and government resources to cover its own incompetence.

    http://www.smartcompany.com.au/tax/053593-revealed-ato-aggressively-muzzling-and-settling-complainants-to-protect-its-own-staff.html

    The really frightening part of this is that ATO staff find the Tax acts and associated regulations unfathomable. When they make a mistake however it’s the taxpayer who takes the hit while the bureaucrats are protected.

    Even sadder are the victims of Centrelink, some of the most vulnerable people in society who are bullied by incompetent and unaccountable bureaucrats and have no real means of fighting back.

    The misery both organisations cause is just one aspect of the nanny state going wrong.

  10. Spot on Paul. And changing the sbject slightly,Travelled through Germany, Spain & Italy last year and was pleasantly suprised how the locals were still enjoying life despite the economic crisis. No bike helmets, alcohol being sold every 50 metres at half the price it is here, you can actually buy alcohol on trains (they force it down your throat), no nanny state rules when going to national parks. Unfortunately Australia is now being run by the crazy politicans & bereaucrats in Canberra who have nothing meaningful to do except keep protecting their own jobs and therefore making it difficult for the people who are really creating the wealth!

    • Thanks Vince, the alcohol on trains rule is a good point – in New South Wales, you’re only allowed to consume alcohol you’ve bought on the train – which is only available on long distance Countrylink service – and in Victoria there’s no drinking at all. Yet passengers still get abused and assaulted by drunks.

      In Europe having a bottle of wine or a few beers with your picnic is almost encouraged and the likelihood of encountering a vicious or obnoxious drunk is far lower.

      Where I think the problem lies is we try to legislate good manners and commonsense into people who lack both which ends up making criminals of most of us.

    • This country is SHIT!

  11. Thanks for the reply Paul. What made me comment on the alcohol on trains is that I’m on a country train at the moment. I would love a beer (even a light beer!), but just because a extremely small minority might overdo it, everyone is banned! Crazy.

  12. Paul, this is the first article I’ve read on the increasing fascist interventions by our govt that has given me some relief and hope! Having returned from Europe I have realised just how much our govt has lost the plot with its endless intrusions on our personal choices and the increasingly crippling costs associated with enforcing all these stupid laws that punish the majority and not the minority of people who stuff up. The last bit of news: wanting to enforce this interlocking system in cars of people who actually don’t drink and drive for a cost of $150 per month in Victoria. WTF?? I am almost getting to the point I don’t want to live here anymore, which I never thought would happen. But, as you say, maybe the Nanny State will just become too unaffordable and collapse. Bring back Common Sense! Please! Before its too late!

    • It’s interesting how this wowser state has developed and it’s differences from earlier generations. I’m often baffled when I look at a hundred years ago with the temperance movement banning alcohol and gaming resulting in the 6 o’clock swill and a thriving SP bookie industry.

      Today’s wowsers are very different. I’m always amused at how one dopey politician or journo will call for a ban on purple bicycling helmets but an hour later will be defending sports betting companies’ right to have blanket advertising promoting exotic bets that almost guarantee match fixing.

      We live in interesting times.

  13. Australians might like to think of themselves as robust individualists who are free to make the most of their own decisions, but the truth is populist governments, through the legal system are winding back our individual liberties.

    But from the perspective of the private sector, the ambitions of the nation’s government are one of the prime factors behind the growing cost of doing business in Australia.

    Cheers

  14. Australia is a nanny state which is going down the path of communism.

    Gun control did it work no . Only on the law abiding the criminals have anything that they want. But more cars kill every year and tabbaco kills at least 100, 000 a year but its ok they get tax from it.

    You cant 4wd or use dirt bike in state forest because you will get hurt. But its ok if u use a registered dirt bike.

    I believe we need licensing from background checks . But I dont believe in the genuine reason its rubbish.

    We dont need gun control we need criminal control. Stop penalizing the law abiding and putting us on the same level of an untrusted criminal

  15. Nanny State rules are nothing but a reason to tax and control. When one thinks of what a person in power wants, its two things…money and power. Nanny state rules give them both, they get to make rules and use them to either tax or penalize and usually you will find them financially gaining through other means pertaining to the laws they make. Leading is not important to Nanny staters, mainly because they do not know how to lead, only legislate. Its a power drug they take every day while in office, and usually they will go for as many terms as they possibly can even trying to change the rules of politics in order to retain their positions in office beyond the normal terms just to feed their addiction.

    I do not smoke, but I find the rules about cigarette packing an absolute joke! Only a power hungry nanny state politician would think of that. I can only imagine the high those involved felt in passing that rule. Then once they got that one passed it was time to get some money and start raising taxes on cigarettes. How hypocritical, pass a law that supposedly helps the public health (which it most certainly does not) but then turn around and profit even more from those who smoke. Where does the money go? cancer research? no, hospitals? very little, lung disease center? ask them how much they get…mostly from private donations, and tobacco companies. Instead they line their pockets with raises and additional benefits, posh vacations and bigger annual bonuses. What’s next a bloody picture of a diseased liver on a bottle of beer? All bottles will be brown and no logo, just pictures of diseased livers and vomiting alcoholics living under a bridge, then they will raise the alcohol tax and it will cost $10 for a beer. Or how about pictures of obese kids on ice cream packages and candy, why not charge a fat tax on anything above 10 calories per serving? Where does it end? What ever happened to, making our own decisions about whats good for us and what’s not? What if I want to be a fat unhealthy smoker? Isn’t that my right of choice in this god given right of life? Is it good to eat bacon with every meal of the day? Should the Nanny staters limit how much butter you can buy in a week? When will the the toilets in our public bathrooms start measuring our blood sugar in our urine and cholesterol levels from our feces immediately flagging the computers and limiting what we can buy when we go to store that day?

    How about we have a “legislation tax”? For those who are so willing to just legislate instead of leading have to pay a very large tax or post a bond on ever law they impose, so when its proven it does not work the time wasted on removing the law is not paid by the taxpayer but by the the legislator. Maybe its time for them to think before the act or pay the price of their mistake.

    • Good points, but don’t mistake me for being anti-regulation or a full on libertarian. I accept there is a role for rules and for governments and we have to pay taxes for enforcing those rules. My point is there are too many poorly thought out rules that duplicate existing regulations or do little to fix underlying, or perceived, problems.

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