Most readers will be familiar with Mark Textor, one of the co-founders of polling agency Crosby|Textor and a strategic advisor to Tony Abbott, the Liberal Party, and various businesses.
In his weekly column in the AFR this morning, Textor addresses a question that has been top of mind for the business community in recent months: why have Australian consumers become so stubbornly withdrawn?
Irrespective of your political perspective, Textor brings what’s widely accepted as an unrivalled insight into the Australian pysche to his analysis of current events. His view on this has currency for both sides of politics and for businesses seeking to understand what’s motivating people at the moment.
Just a quick recap. The stimulatory effects of the current record-low interest rates are failing to materialise in many quarters. RBA governor Glenn Stevens went so far as to say last week that he had “allowed the horse to come to the water of cheap funding. I cannot make it drink.” In other words, Dear Australian businesses and consumers: spend, dammit.
Australia is facing uncertainties on many levels. Large portions of the federal budget are in limbo, subject to negotiations with an unpredictable Senate. The transition in the economy away from mining to other sectors has been agonisingly slow. Exporters in other sectors haven’t seen the benefit of the lower dollar they’ve been promised. There has been talk of a decline in living standards, and the unemployment is suddenly at 6.4%.
Layer global events on top of that – the shooting down of MH17, the rise of ISIS and the attendant rush of Aussie youngsters to the Middle East to join the bloodthirsty mob of extremists – and there are risks near and far.
This has, Textor argues, driven Australians into a “nesting” phase, characterised by reduced tolerance for ill-discipline and excess, and increased focus on maintenance of the things people can control.
Disorganisation and ideological indulgence at the political level is now given zero tolerance…
The protective parts of the nesting instinct can mean even more profound changes, especially regarding taxation.
In the carefree economic days… people were tolerant of the excesses of some businesses.
But … big business profits and tax breaks – tolerated in the good times – become in their eyes, their own money lost… If businesses want to play their part in our society, from the public’s new perspective, they must avoid tax advantage at the expense of middle Australia.
(It’s worth noting that in recent days finance minister Mathias Cormann has specifically warned the government could resort to tax increases to balance the budget if savings measures aren’t passed.)
There’s a final warning about sideshows and distractions in the current environment.
The growing list of “threats” to their nested world – underlying racism, antisocial behaviours in the community, a lack of discipline in the education system, the growing power and influence of the “noisy”, particularly ideological warriors who seem disconnected from the real-world household – means the nested will seek to protect and mitigate against these threats in other ways if government cannot.
But beware, the nesting are very protective. The electorate’s hormonal response is now to protect the vulnerable. The nesting senses are heightened and they spot threat and dishonesty more readily. “Mum’s radar” is now more far reaching than ever. Beware.
Textor’s view isn’t just an opinion offered for consideration; he draws on the insights from his company’s surveys of public sentiment. While there’s a clear warning about behaviour in the political sphere, it also highlights that there’s a premium on predictability and reliability for consumers, who look outside the door and currently see an uncertain world.
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