Millionaires are more common in Australian politics than most voters would think. There is a good reason for our obliviousness — our politicians like to play down their wealth.
In America wealth is celebrated or even worshipped but the tall poppy syndrome is alive and well here, which poses a conundrum for billionaire Clive Palmer, Australia’s fifth richest man, with wealth estimated to be $5.05 billion according to BRW magazine.
Palmer is not known for mincing his words and recently accused the Greens of having been infiltrated by the CIA. When he announced his bid for Coalition pre-selection, including a withering assessment of current treasurer Wayne Swan, he also announced his intention to build a modern replica of the Titanic.
Even in the United States politicians can rub voters up the wrong way with their wealth. Presidential candidate Mitt Romney, for example, hasn’t endeared himself to America’s working poor with comments about enjoying sacking people and gloating about his collections of cars and houses.
Being successful in business is a good credential for pre-selection to the Coalition, which likes to represent itself as the party of business and likes to point to the Labor Party as the representatives of unions and socialist ideals.
When it comes to public perception Australians are discriminating, according to lobbyist Jody Fassina.
“People will ultimately ask the question: ‘Does Clive want to enter politics to serve the public interest or to serve his own interests’,” Fassina said. “That is the threshold question he needs to overcome.”
Palmer can take heart from LeadingCompany‘s list of current and former politicians with bulging bank balances but he might benefit from a look at how they have handled public perceptions of their fortunes.
Kevin Rudd
Therese Rein, wife of the former PM, may be the person responsible for the family’s wealth but her business acumen makes Rudd one of the two wealthiest people in today’s federal parliament along with Malcolm Turnbull.
Rein sold her business interests in Australia when Rudd won office and set up in the United Kingdom where her company, Ingeus, provides employment services and is reported to have recently won contacts worth an estimated $1 billion over five years. As the country’s leader Rudd was careful to portray Rein’s success as stemming from humble beginnings, repeating stories about her getting a small bank loan ($10,000) to start her company.
Malcolm Turnbull
Once leader of the Coalition, Turnbull has been on and off the Rich List, with his fortune estimated at around $168 million. The merchant banker-turned-businessman was an investor in OzEmail, one of the earliest internet service providers, which secured him the bulk of his fortune. His business background gives him credibility with voters but it has also been a headache.
He was embroiled in a Royal Commission into the collapse of insurance company HIH and had civil action brought against him by HIH liquidator McGrathNicol.
Ted Baillieu
Premier of Victoria Ted Baillieu comes from a pedigreed family of fortune. The Baillieu family is worth $405 million and is a member of Victoria’s circle of super-wealthy family dynasties that includes the $2.01 billion Myer family and the Besen family, worth $2.08 billion, according to BRW.
Baillieu’s business connections have come too close a few times, most notably when the Liberal government of Jeff Kennett closed and sold off 350 schools and handed much of the realty business to the family real estate firm Baillieu Knight Frank.
Malcolm Fraser
The one-time leader of the Coalition and prime minister between 1975-1983, Fraser was born in the posh Melbourne suburb of Toorak to a family with a history of political involvement and pastoral wealth in Victoria’s western district. His father John had properties in the Riverina region in New South Wales.
Fraser’s wealthy past came back to haunt him when he said in a speech that “life wasn’t meant to be easy” at a time when unemployment was at record highs. The full quote, originally from playwright George Bernard Shaw, is: “Life is not meant to be easy, my child; but take courage: it can be delightful.”
John Moore
A Queenslander who was raised on a cattle station, Moore’s political career culminated in his role as a cabinet member in the new Coalition government of John Howard in 1996 where he was industry, science and tourism minister. Before entering politics he had a successful career as a stockbroker and professional company director.
He started a stockbroking firm which became the largest single trader business in Queensland and had barely taken his ministerial seat when his business and political careers collided because he had retained shareholdings in technology and share trading companies that could have posed a conflict of interest. He was nearly forced to resign for breaching Howard’s code of conduct but managed to hang on. He was left out of a cabinet reshuffle in November 2000 and resigned in 2001.
*This article was originally published at LeadingCompany
There is also a low poppy syndrome in Australia. The idea that minimum wage earners should reduce their wages or conditions to benefit the big end of town. Or that middle and lower income earners bear the greater tax burden.
It is more complex than just throwing up the Tall poppy syndrome with respect to political candidates without deeper analysis. It is no mystery why voters might take pause at great wealth of a politician whose decisions may be impacted by a strong conflict of interest in formulating policy.
And while many politicians may wrestle with this dilemma, it is a strong character that would put personal interest aside for the benefit of the greater good.
Unfortunately there are not too many of those in politics.
What was the point of Therese Rein selling her Australian interest in Ingeus given free trade arrangements mean much of the outsouring of employment functions to the private sector is contracted to foreign companies. It would be interesting to know what the break up is between foreign owned and Australian owned in this sector. FOI anyone?
@ Bluepoppy
Your first comment is great.
Doesn’t Peter Garrett count as being rich?
“Tall poppy” is another one of those worthless throw-out lines that meant nothing to begin with and has become even more redundant with over-use.
“billionaire Clive Palmer, Australia’s fifth richest man’
Maybe, but most likely not.
[(theconversation.edu.au/mining-magnate-property-tycoon-politician-just-who-is-clive-palmer-6646)
So Palmer has one income-earning asset (Queensland Nickel, a nickel and cobalt refinery near Townsville that he picked up for a song from BHP Billiton in 2009) and a whole bunch of tenements offering nothing but promises of future wealth. Mineralogy and its subsidiaries reported net losses of $58.5 million in 2008-09, $29 million in 2009-10 and $11.4 million in 2010-11. It received a tax benefit of $874,599 in 2010-11, against revenues of $5.6 million, and paid $136,799 in tax the year before. It is difficult to criticise a company that pays no tax when it earns no real income and most of its costs are incurred by trying (to) prove-up a large resource in a remote area.
These accounts highlight the difficulty of valuing Palmer’s mineral deposits and therefore his personal wealth. Business Review Weekly listed Palmer’s wealth at $5.05 billion, but America’s Forbes magazine rates it at a more modest $US795 million.]
My comment on that article:
In his Hong Kong failed IPO (Jason West) forgot to mention that this was his fourth attempt! The day before the listing he dropped the price 30% but those savvy Chinese investors were not buying at any price. It was pretty close to a scam; and would have been impressive if he had pulled it off. On the other hand it shows him up for being both greedy (see below) and very patronizing of his Chinese targets. Here’s why: (extracts from a Bloomberg report.)
[Resourcehouse wants to develop an iron ore mine in Western Australia that will cost at least $2.7 billion and an $US8.6 billion coal mine in Queensland state. Mineralogy and Waratah Coal, both owned by Mr Palmer, remain the owners of the mines and Resourcehouse only has an agreement to extract specific quantities.
Mr Palmer, who ran full-page color ads in Hong Kong’s English- and Chinese-language papers for the share sale, stressed his connections when marketing the IPO of the company that he stood to draw $1.1 billion in payments in the three years before it turned a profit.
“It’s absolutely a turnoff for investors because how can you be sure how those fees are going to be spent? It is unusual,” said Michael McCormick, fund manager at Belvedere Share Managers.]