David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Hansard source

My name is David and I am an OPM addict. Actually, that is not true; I am not addicted. I might be one of the very few people in this house who is not, because addiction to OPM is a national crisis and I am surrounded by addicts. I am not talking about the drug opium but something far more terrible. I am talking about an addiction to other people's money.

The great economist Milton Friedman taught us that there are four ways to spend money: spending your own money on yourself; spending your own money on somebody else; spending other people's money on yourself; and spending other people's money on somebody else. When you spend your own money on yourself there is a strong incentive to spend it wisely. Nobody spends money more carefully than its owner. That is why it is more efficient, as well as right, for people to be allowed to keep their own money. When you spend your own money on someone else, you will still be motivated to economise but somewhat less likely to satisfy the needs of the other person. Anyone who was given or who received an unwanted gift would understand that concept.

Even with the best of intentions, spending your money on someone else does not always work out for the best. When you spend other people's money on yourself, you have no strong incentive to keep down the cost, but at least you have a strong desire to fulfil your own needs. But there is an even more wasteful type of spending—that is, spending other people's money on other people. In this scenario you care little about both value for money and meeting the needs of the people on whom you spend the money. Spending other people's money on other people is what we do here. It is the worst kind of expenditure and it explains why so much public money is wasted. An inevitable characteristic of OPM is that so many grand government plans are destined for failure. Before we can do something about our addiction to OPM, we must first acknowledge our problem. What we need is an OPM Addicts Anonymous.

Many government programs are not created because people demand them or because the market was unable to provide the services but because politicians have bought favour with OPM. Politicians are addicted to OPM because they use it to expand their influence, reward political cronies and keep their constituencies dependent on them. Since becoming a senator I have attracted many new friends. My calendar is full of appointments with people who want to meet me. I have a strong suspicion that at least some of my new friends are less attracted by my fabulous looks and winning personality than by the decisions I make about other people's money. But I ask you: what right do we have to be so cavalier?

If I were to ask everyone in this chamber to turn out their wallets and purses and give me a third of the money in their possession, I imagine there would be some disquiet. If I were to tell you that the reason for taking your money is that I know better than you what you should do with it, I would expect there would be some resentment. What is more, if I explained to you that if you refuse to give me the money, you could go to jail, I expect there might even be some anger.

Imagine that I decided the large pile of cash you were forced to give me was not nearly enough, so I went out and borrowed more, with the cost of the interest to come out of your pile and the debt left hanging over you and your children. Then imagine that I started spending it foolishly on things you do not want. It would be natural to feel outraged. In fact, you should be outraged. It is something most of us would recognise as common theft. Not only that, it would constitute authoritarian, incompetent, irrational, vain, patronising and delusional behaviour on my part. But that is exactly what the Australian government does to the Australian public, no matter who sits on which side of the chamber. Many people would call it stealing, but in this place we just call it another day at the office.

One of the biggest problems with OPM is that we either overlook or do not truly appreciate its true cost. Oscar Wilde once described a cynic as being someone 'who knows the cost of everything and the value of nothing'. But there is a far more dangerous type of person in a place like this and that is the dreamer—someone who values everything but understands nothing about the cost. We have seen heartfelt and teary-eyed declarations for paid parental leave, services for veterans, a schoolkids bonus, a national disability scheme, Gonski school funding and medical research. All these things sound great in principle but the reality of OPM is that money spent on these things is likely to be spent recklessly, in ways that people would not spend on themselves.

The legal language that we use in parliament tends to hide the cost of things. Perhaps it would focus our minds if we were obliged to give prominent mention to the cost of OPM in each piece of legislation as it comes before us, much like supermarkets and petrol stations are required to display the prices of their products before decisions about spending are made.

Prime Minister Abbott would be much more honest if he explained that his Paid Parental Leave is really about spending OPM taken from people who do not have children on people who do have children. And Bill Shorten would have been much more honest, when speaking recently about the submarines contract in Adelaide, had he pointed out that the projected cost of OPM, of making the submarines in Australia, would be about $2,200 for every man, woman and child. For that price, battlers in western Sydney or Melbourne could give themselves a holiday, pay off a chunk of their mortgage or buy themselves a better car, using their own money.

Politicians pretending to be compassionate, when all they are doing is handing out other people's money, are just thieves masquerading as angels. Far too much of our political debate is restricted to the question of how to spend OPM or, if you like, who is the better dealer in OPM. This is the wrong question to ask because, as Milton Friedman taught us, it is the very nature of the spending that is the problem. A much better question to ask is this: why don't we just let people spend more of their own money?