Everyone knows Australia is facing significant economic challenges with the need for a serious debate to secure predictable and steady economic growth in Australia.
Yet neither of the major political parties has the fortitude to discuss structural reform of our economy.
The monotonous “party dictated” response to the need to address taxation reform or burgeoning healthcare costs or the structure of the fiscal budget is to defer to a ‘soon-to-be commissioned’ inquiry.
But politicians who cannot enunciate a personal view on a range of critical social issues are doomed.
While each party drifts along seeking to win or maintain power by default (that is, a protest vote against the incumbent), there are significant population and voter trends that are changing the electoral landscape.
Indeed, it appears that the major political parties have failed to comprehend that this changing voter landscape will likely swamp both them and the traditional means of electing governments in Australia.
Hung parliaments may well become the norm, as the ‘grey vote’ is counterbalanced by the youth vote.
Figure 1. Australian population
Source: Trading Economics, World Bank
In eight years Australia’s population has grown by 2.7 million. There were about 1.9 million live births and around 0.9 million people died. About 1.7 million immigrants arrived and about 1.6 million young Australians joined the electoral roll.
Australian demographic changes have significant implications for voting trends including:
- There are 200k to 300k new voters each year. This amounts to almost 1 million additional new voters in each election cycle;
- The bulk of these are young people who are politically unaligned;
- Many of these people communicate, share ideas or thoughts and are entertained by mobile means – that is, social media. They do not watch TV or read newspapers like their parents do;
- There are about 100k people (older ones) who have been politically aligned but are dying each year. That is 300k people exiting each election cycle; and
- Based on the above, an ageing population or the so-called “grey vote” is being counter-balanced by a younger and more “volatile” (in their voting patterns) generation.
Similar trends overseas suggest that the splintering of traditional political parties is likely to occur.
Figure 2. Voter turnout of age-eligible population – Congress/Parliamentary elections
Both the conservatives and the political left will soon realise that they have to respond to the pressing needs of a younger generation.
Whether they are young students, young workers or young families, the financial pressures have become enormous on young people.
And if a younger generation is struggling under the heavy cost of living and they are increasingly forced to stay at home, then their parents (the “grey generation”) may also become politically nonaligned and agitated.
Future trends are generally easy to see but the political landscape has never been so difficult to forecast. This is an issue of uncertainty that will confront investment markets in coming years. No one can be assured that economic policy will not change on a political whim or a chase for the popular vote.