If the state could start over, what would it make free and what would it charge for? Two recent experiences made me revisit that question, alongside the observation that big tech companies are getting richer by extracting small payments from customers too busy to notice.
It was 57 degrees Celsius inside the Sydney Cricket Ground last month. Parts of New South Wales topped the state’s highest recorded temperature. As I went off to commentate at the ground, the streets were busy with ambulances ferrying people to hospital who had collapsed with heat exhaustion. I was concerned about my wife and two children (both under five years old) stuck in our rental apartment, which didn’t have air conditioning.
Ed Cowan, the former Australian batsman, suggested a remedy. “They should all spend the day at Woollahra public library.” I was sceptical, to say the least. A broiling day cooped up in a stuffy public library?
But Ed was right. When I joined my family at the library in the late afternoon, they were in high spirits. Yes, the public space was safely air-conditioned, but that was the least of it. The library is cool in every sense, a kind of interior garden designed to encourage a love of learning. The returns desk is a gap in a lush green bank of real plants. Toddlers arrive at their selection of books via a giant slide. The staircase has a shallow rake and soft steps that double up as seats: it’s inviting to climb, but forgiving if someone falls. Imagine Scandinavian public investment and social cohesion reworked for a sunny place: this is Woollahra public library.
If it sounds more like a chaotic playground than a library, think again. It’s not sombre, but the mood is still calm. Professional writers escape to the quiet corners. Undergraduates cram for their exams on the higher floor. I can’t remember visiting a more impressive new public building.
Yes, Woollahra is a wealthy suburb (although not everyone in the library was rich, by any means). And it’s obvious, given how the modern state is already overstretched, that there can’t be libraries costing more than £3m in every corner of every city. Nonetheless, as we walked back to our apartment, I reflected that when I had been anxious and needy, the state had sheltered my family. Not a hotel or private club, but local government.
That the experience was openly available made it even better. If I ever pick up a parking ticket in Woollahra, I’ll know it is going to a worthy cause. My sense of debt was not just financial – how much would I have paid for the service had it been a straightforward commercial offer? – but also more abstract. The state had provided a service – “free” but unforgettable – that I couldn’t have imagined, even if I’d been happy to pay for it.
It’s easy to celebrate lovely experiences that come without a charge. What of the converse: what would we stomach paying for separately and explicitly that currently comes bundled as a “free” public service?
I pay £7 each time I park at the local train station, “plus a 20p service charge” if, as I always do, I pay by mobile phone. (That is a dubious add on, incidentally, because I’m saving the car park money by using my phone rather than requiring a paper ticket from the machine.) Totted up over the year, £7.20 is not a negligible sum. It’s much more, for example, than road tax, which comes in one annual lump and I always slightly resent. With the parking fees, in contrast, the size of the unit influences my preparedness to shrug it off.
I’m far from the first person to turn that insight into a business idea. When Apple charges me 79p each month for iCloud storage, I do not rush to my laptop and start deleting old photographs in order to reduce my data requirements and hence avoid the charge next time. Perhaps I should, but I don’t. Over the course of a lifetime, the accumulation of those 79ps is good business for Apple. It prices the service below my sensitivity.
Something similar happens when I park at the station. It is necessary and not exorbitant, so I put up with it. However, while I pay £7.20 to park on a small piece of tarmac, I don’t make specific payments relating to the miles of tarmac I drive over to reach the station. I pay-as-I-park, but I don’t pay-as-I-drive. Why should a driver pay only for a stationary car and not a moving one?
We all bridle at new charges, but usually accept the new status quo when it becomes normal. I would accept explicit road taxes if government could find a way to extract the money easily, ideally in small units. It would be the inverse of the Woollahra experience: not free, but forgettable.
Such a scheme is not out of reach. Gergely Raccuja, a 27-year-old graduate of University College London, won last year’s Wolfson Economics Prize for showing the benefits of replacing existing road and fuel taxes with a single, distance-based charge. The weight of the car, how environmentally “clean” it was, and the miles it had covered would determine the charge, to be levied by insurance companies. Raccuja’s scheme projected both a change in driving habits and more money for the Treasury. If people are prepared to cough up for measured mobile phone data, they would eventually get used to metered payments for road usage.
Good businesses keep loyal customers by levying payments that seem unobjectionable, while providing services that appear to be good value. In the same way, government faces a dual challenge: improving the ratio of income (taxes) to resentment, while simultaneously providing more satisfactory services.
In recent decades, huge energy and intelligence has focused on the latter. Perhaps there is now more mileage in trying to improve taxes.
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This article appears in the 28 Feb 2018 issue of the New Statesman, The rise of the radical left