Hockey blasts attitude of 'entitlement'

Shadow treasurer condemns systems of 'universal entitlement'' in Western democracies.

By InvestSMART · 19 Apr 2012

By InvestSMART ·
19 Apr 2012

Comments

Shadow treasurer condemns systems of 'universal entitlement'' in Western democracies.

SHADOW treasurer Joe Hockey has condemned systems of ''universal entitlement'' in Western democracies, contrasting this attitude with the concept of ''filial piety'' thriving across Asia where people get what they work for and families look after their own.

Speaking in London, Mr Hockey said that by Western standards the highly constrained public safety net in Hong Kong and other Asian places might seem brutal ''but it works and it is financially sustainable''.

''Contrast this with what we find in Europe, the United Kingdom and the United States. All of them have enormous entitlement systems spanning education, health, income support, retirement benefits, unemployment benefits.''

Government revenues fell far short of meeting the cost and the difference had to be made up by borrowing.

While he was less critical of Australia, saying that over the years there had been some key decisions to reduce spending, Mr Hockey said it still had ''a lot of spending by government which many voters see as their entitlement''.

He said a lower level of entitlement meant countries were free to allow business and individuals to be successful. ''It reduces taxation, meaning individuals spend less of their time working for the state, and more of their time working for themselves and their family.''

Both sides of the Western political spectrum were to blame for the entitlement mentality. Socialist governments had created a huge array of entitlements, and conservative governments had promised to fix the problem but just trimmed round the edges.

''Perhaps the real problem is the exuberant excesses of politicians who do not seem to understand or care about the fact that, like a household, a nation needs to balance its budget over time,'' he said.

But now ''the age of unlimited and unfunded entitlement to government services and income support is over'', he said. ''We are now in an era where leaders are much more wary about credit risk.''

Go to Google News, then click "Follow" button to add us.

Share this article and show your support

Frequently Asked Questions about this Article…

Who is Joe Hockey and what did he say about entitlement systems in Western democracies?

Joe Hockey, the shadow treasurer, criticised what he called systems of 'universal entitlement' in Western democracies. Speaking in London, he argued these large entitlement systems—covering education, health, income support, retirement and unemployment benefits—have grown costly and contributed to governments borrowing to make up shortfalls.

How did Hockey contrast Western entitlement systems with social norms in Asia?

Hockey contrasted Western entitlement systems with what he described as 'filial piety' in parts of Asia, saying families look after their own and that highly constrained public safety nets in places like Hong Kong may seem harsh by Western standards but, in his view, 'work' and are financially sustainable.

What did the article say about government revenues, spending and borrowing?

The article reports Hockey's point that government revenues in many Western countries have fallen short of meeting the cost of entitlement programs, and that the shortfall has often been made up by borrowing rather than fully funded spending.

What was said about Australia’s spending and entitlement culture?

Hockey was less critical of Australia, noting that some key decisions over the years have reduced spending. However, he said Australia still has 'a lot of spending by government which many voters see as their entitlement.'

How does Hockey say lower entitlement levels affect taxation and business?

According to Hockey’s comments in the article, a lower level of entitlement allows countries to reduce taxation, which he says means individuals spend less time working for the state and more time working for themselves and their families—creating space for business and individuals to be more successful.

Who did Hockey blame for the entitlement mentality?

Hockey blamed both sides of the Western political spectrum: he said socialist governments created a wide array of entitlements, while conservative governments often promised fixes but only 'trimmed round the edges' rather than addressing the root problem.

What did Hockey mean by saying 'the age of unlimited and unfunded entitlement is over' and mentioning credit risk?

Hockey argued nations, like households, need to balance budgets over time. He said we’re entering an era where leaders are more wary about credit risk, implying that unlimited and unfunded promises for government services and income support are no longer politically or financially sustainable.

What are the potential implications of Hockey’s views for everyday investors?

The article suggests, via Hockey’s perspective, that policy moves toward smaller entitlement programs and greater caution about borrowing could lead to lower taxation and a business environment with more room for private success. These are the outcomes Hockey associates with reduced entitlement, though the article reports his views rather than projecting specific market outcomes.