The Natural Party of Small Business

by on 24 February, 2010

Ben-Scott Small business is ‘naturally’ forgotten by the Labor Party, writes Benjamin Scott.

“The natural party of opposition” and “The natural party of government”. Both are such bold statements, and whilst I sincerely hope the Australian Labor Party represents the former and The Liberal-National parties the latter, I must admit to not yet finding extensive or credible evidence for either.  Academics and commentators have written widely on the concept with numerous attempts to achieve validation using all sorts of electoral statistics in the history of Australian Federation. However, the idea of a ‘natural party of government’ remains elusive. Less so, is the concept of “natural constituencies” which raise many questions about political representation.

The Labor Party looks to highly unionised workforces as their natural constituency. Although, this has actually become increasingly debatable due to the effects of recent employment and environmental proposals that affect both the job prospects and quality of life of this constituency. In a paradoxical twist which commentators have long debated, it is apparent that activist and union movements contribute largely to the concept of the Labor Party being ‘the natural party of opposition’. It is largely a party of radical activism built to oppose. Some Labor operatives will admit in quiet moments that the party’s ignorant unwillingness to shift on its rigid IR legislation means it may one day finally claim the mantle as ‘the natural party of opposition’. 

Conversely, the Liberal-National parties have looked to the small business sector as a natural constituency. There are those who will argue that it is a fundamental philosophical basis that makes an individual ‘conservative’ or ‘liberal’ and it is these individuals who collectively form this natural constituency. I remind readers that there is an important section of Australian voters who actually do not vote along a hard philosophical line. I would also remind readers of that profound speech from Sir Robert Menzies citing the “forgotten people”, which continues to perfectly encapsulate Australia’s small business sector today. A case in point is the fact that Liberal-National politicians will readily acknowledge aspects of its past IR policies as ‘going too far’. Unlike Labor’s ignorance, inflexibility and stupidity on the serious issue of IR reform, this highlights the Liberal-National parties’ natural capacity to appeal to small business. Make no mistake, I feel it important as ever to reinvigorate politics through ideology and philosophy as that is truly the road to credible policy and better government. Politicians should never disregard this vital foundation. However, when we discuss representation we have moved a step beyond the realm of ideology and philosophy to a more mechanistic democratic concept.

If we look at the purely statistical snapshot of small business in Australia, leaving out its considerable extenuating social benefits, we see a compelling constituency:

• Approximately 1.93 million active small businesses in Australia.

• Small businesses make up 96 per cent of all businesses.

• Small businesses employing 3.8 million people, accounting for around 46 per cent of total private sector employment.

• More than 17,000 small businesses are exporting and just last year shipped goods estimated to be around $1.2 billion.

A compelling picture, even if we accept the view that small business contributes approximately 35 per cent of Australia’s total GDP, without considering what that percentage would be if we reduced an overspending and bloated government sector from the equation.  Even if we accept all these statistics, what we continue to see from the ALP’s philosophical and policy base is a systematic attack on an Australian’s right to go into business. Is it any wonder that small business detests the Labor Party’s obsession with centralisation and increased taxation as much as an Australian Liberal or Conservative should.

My colleague Mitch Redford, recently elucidated in his considered article, “A man in a suit with a grin, an army of bureaucrats and a wad of your cash” that the concept of taxation has morphed dramatically since inception. Ironically, whilst watching a news report on the resurgence of the ‘Tea Party’ libertarians and conservatives in the Unites States, I was reminded of one of the more interesting quotes I’ve discovered regarding the issue: “no taxation without representation”. Irrespective of your view regarding the movement or the statement, the presence of gigantic and complicated taxation systems have combined with bloated bureaucracies to muffle political representation. The actual quality in the political representation side of this equation is also, in itself, highly debatable. As are the numerous other effects of large and stifling bureaucratic entities that are killing small business in Australia. I am certain there is a potential PhD thesis in this. Possibly even a Rudd-like “polly-waffle” quarterly essay that investigates the historic parallels with the Boston Tea Party, the Thirteen Colonies and their fight for Independence pontificating on why the Labor Party are inherently against independence and simply ‘evil’. I will resist the temptation to do so.

Take an obvious example in the ETS, a monolith of a tax system not ever before seen; with previous estimates showing the small business community staring down the barrel of a minimum $1000 slug per household. Erased from the real economy and lost to Government coffers forever. An all-out assault on small business in Australia. Loaded in the second barrel and ready to fire on the small business constituency of Australia is rigid IR legislation. This will see vulnerable employees and casual workers, such as students, shown the door. Not for the fault of the struggling cafe or fruit shop owner, but for a Labor Party that perceive such people as ‘evil capitalists’ and a fundamentally flawed IR system that will cripple small businesses across the country. This constituency does not take lightly to attacks. Indeed, this natural constituency of the Liberal-National parties is once again looking for flexibility in the debate. 

As similar cries to “no taxation without representation” become increasingly muffled and distant even more convoluted taxation schemes, such as the ETS, rear their ugly head with the associated bureaucratic bloating. Or as Senator Barnaby Joyce refers to, the “battalions of bureaucratic tin gods on the quest for Australia to cool the planet”. It would serve the Liberal-National parties well to listen intently to the distant calls of an infamous ‘silent majority’ that primarily consists of small business, as they did with the ETS. The liberal and conservative side of Australian politics must never forget there will always be natural constituencies for political parties. More importantly it must recognise, in every possible way, that it has the most formidable natural constituency for a political party and that is the small business sector. Who knows, this may be the beginning in establishing evidence for “the natural party of government”. But that might be going too far.

Benjamin Scott is the Inaugural Vice President of the Young LNP in Queensland, was an LNP campaign strategist in the last election and a former staffer to politicians at all levels of government. He now works as a Government Relations and Communications Manager in the private sector. 

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