Monday 23 Jul 2018 | 16:15 | SYDNEY
Monday 23 Jul 2018 | 16:15 | SYDNEY

Reader riposte: The no-risk society


Sam Roggeveen


10 September 2008 10:28

Hans van Leeuwen responds to Mark Thirwell's post on the growing role of goverment in the management of the global economy. My thoughts below:

Mark Thirlwell is right, I think, to argue that the role of government in the economy is being recast. In addition to the sources of this trend that he cites (the growth and influence of state-led economies such as China, and the current financial crisis), I'd argue that there's a longer-term trend arising from the Western political culture of risk aversion, somewhat along the lines described by Ulrich Beck.

Every time there is even a remote possibility that voters in Western countries might feel discomfort or pain (or injure themselves), there is now an expectation (often driven by the media) that governments should 'do something' to mitigate this. It began in the late 1980s or eary 1990s as public authorities attempted to ward off personal-injury litigation (ie. governments accepted the responsibility that plaintiff lawyers demanded they take). It has since crept into the social sphere, and the credit crisis shows that it now has a new beachhead in the economic realm.

This trend shows a touching (but probably misplaced) faith in the power of public policy to ward off or remedy ills without creating new ones; but also perhaps a disturbing inability to accept responsibility for the consequences of our collective economic actions (moral hazard). Or maybe there's an even simpler explanation: we are so accustomed to the luxury of economic good times that stalling house prices and rising energy costs now represent unacceptable levels of discomfort.

I think Hans is on to something, and he doesn't even mention the recent calls for our government to 'do something' about rising petrol prices. If Hans is right, then although Hugh White might have made a valid point when he argued that the last government spent too much money and effort on consular support to Australians overseas, we should not look for a reversal of this trend. The political tides are against it.