Fixing politics: short-term gain vs long-term pain

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Leaving aside the relative merits of Labor and the Coalition,
arguably the greatest advantage of having a new mob in the Lodge is
that, just for a moment, it makes it easier to see how much of what
frustrates us about politics can be ascribed to individual politicians,
and how much is the fault of the system they work within.

When it comes to political dysfunction, most of us suffer from what
psychologists call “fundamental attribution error” — the tendency to
attribute behaviour to individual character traits rather than the
situations that people find themselves in. Understandably, the media is
particularly susceptible to this error. Stories about people are so
much more interesting than stories about systems.

So it’s a rare journalist who asks the question that Bernard Keane
posed last Monday: “Is our current political model, the accepted way of
governing in Australia, capable of dealing with the challenges of the
21st century?”

When a party which so clearly wants to overcome the “short-term outcomes dictated by the electoral cycle” can’t even resist sacrificing next year’s policy agenda on the alter of the 24-hour news cycle, the answer has to be ‘no’.

The petrol price stoush has certainly been the most obvious example
so far: buying into a debate over a tax cut that would save the average
motorist around $100 a year — compared for example to the $1000 a year
that he or she could save if fuel efficiency standards
were raised to 6.8L/100km. As the ABC’s political editor Chris Uhlmann
pointed out in John Lyons’ ‘Captain Chaos’ article: “The longer Labor
plays short-term politics on petrol, the harder the long game will become.”

But it wasn’t the first time that good policy was sacrificed to the
polling gods (think tax cuts and carers’ payments) and it probably
won’t be the last. As the Chinese proverb says “if we don’t change our
direction, we are likely to end up where we are headed”. And we’re
unlikely to change direction until we find a way of getting hyperbolic discounting out of politics.

Hyperbolic discounting is an economist’s typically obtuse way of
describing the human preference for jam today over jam tomorrow. A
certain bias towards the present is rational – in financial matters.
$100 tomorrow is not worth as much to us as $100 today. If we had $100
today we could invest it and have more than $100 tomorrow. And tomorrow
we may be dead. But behavioural economists find that we are much more
biased towards the short-term than a hypothetical “rational human”
would be.

To counteract a habit that we know is against our own long-term
interests, we sometimes find ways of coercing ourselves — of empowering
the “future I”. We put our alarm clock on the other side of the room
the night before to make it harder to give in to the urge to sleep in
the next morning. We let ourselves pay higher tax rates throughout the
year to accrue a lump-sum rebate that we’re less likely to spend.
Superannuation is a government-enabled means of doing the same thing.

But how can governments do likewise?

Savvy political leaders who want to resist the constant pressure to
think in soundbites need to do the equivalent of placing their alarm
clock on the other side of the room. FDR, when approached to support a
particular cause, reportedly said “I agree with you. I want to do it.
Now go out and make me do it.”

Only the most informed and engaged citizens, the most responsible
media, the most independent institutions, the most fearless and forward
thinking public service, can help politicians serve the interests of
future voters. We all have to do our bit too, obviously, but there are
some things that governments with foresight can do to create rods for
their own backs. And that’s the subject of a future article.

This article was first published in Crikey on June 30, 2008

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