There are few feats of human biomechanics as impressive as watching an Australian politician flee from the suggestion that he or she might demote the family home from its privileged position in our tax, social security and economic policies.
Social Security Minister Scott Morrison — so hardnosed and ruthless toward asylum seekers — set a new landspeed record this morning in distancing himself from a news report that suggested the government might consider adding the family home to the aged pension means test.
The political reality that sends even the bravest minister into retreat with, to mangle Chariots of Fire, dread in their hearts and wings on their heels, reflects the extent to which property and “the family home” (not merely the home, but the family home) are embedded in the Australian psyche and our economic view of the world. Our entire taxation system privileges home ownership and investment in a way that generation after generation of economist has explained is deeply distorting of our economy. Similarly, our aged pension system rewards those who have stored wealth in their homes, often homes long since grown far beyond the needs of their residents. It’s a perfect symbol of the way the Australian economy overinvests in real estate at the expense of more productive investments in business activity and infrastructure.
As Morrison’s example demonstrates, it’s difficult for a politician to even start a debate on this distortion without the worry that they’ll go to the next election facing a scare campaign about pensioners forced to sell their homes or face accusations they want to tax the windfall gains Australians who own urban property make from the property market.
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Perhaps as a first step, the government could refer the issue to the Productivity Commission, which is now the go-to institution for what might be called “policy laundering” — getting a potentially controversial policy into public debate without being politically connected to it. But one way or another, challenging the dominance of the “family home” in voters’ minds should make its way onto the agenda.