Leon Delaney:
The federal Member for Fenner who happens to be the Assistant Minister for Productivity, Competition, Charities and Treasury, gave a significant speech on this topic, touching on other matters as well. Dr Andrew Leigh, good afternoon.
Andrew Leigh:
Good afternoon Leon, great to be with you.
Delaney:
Thanks for joining us today. I first heard about what happened in Wangaratta, unfortunately by scrolling through Facebook before I went to bed and there were posts about that. And then I followed up, of course, looking at more traditional sources of news to confirm that it was actually true. There’s a bit of irony in that, isn’t it? I’m sitting at home getting my news on Facebook?
Leigh:
That’s absolutely the norm these days, isn’t it Leon? Because the majority of Australians now get our news from social media, as is true with people around the world. It’s outplaced traditional sources of news such as newspapers, radio and TV and it is changing the news we receive.
What comes to us on social media tends to be the stories that fire us up. Stories that are angrier and more divisive, less often stories that are considered and thoughtful. Yes, we get those breaking news stories but in terms of the other snippets, often it’s snippets that make us mad rather than make us think.
Delaney:
The other thing that causes me to raise my eyebrows that I saw figures recently. I don’t know how accurate they are, but they claimed that when it comes to trust, politicians and the media are at the low end of the spectrum of public trust and that more people say that they trust podcasts than traditional media. Now, podcasts of course, might be wonderful; they might be very accurate or they might not be because they can be created by anybody with virtually no regulation. So why do people trust podcasts and other forms of online media that are not as well regulated and as well governed as the traditional media?
Leigh:
Well Leon, your profession and mine have never been rated terribly high by the Australian public. You look to occupations like the police, nurses and teaching if you want to find occupations that have very high trust ratings. I think that suggests that there’s work to do for both of our professions. But I think it’s also a reminder of the importance of, as the Prime Minister said, bringing the temperature down. We need to make sure we’re treating one another with kindness. And we also need to ensure that where we can, social media is still serving you up posts by your friends rather than strangers who are trying to make you mad in order to make a quick buck.
Delaney:
Yeah. Now this was the topic of your speech last night, and asking the questions of ‘How did outrage become a business?’ for example. That’s really at the heart of what this is all about. Social media, when it first started, it really was social. Not so much anymore?
Leigh:
That’s right. First, it was the post of your friends organised chronologically. Then it was the post of your friends organised algorithmically and then it was whatever the algorithm wanted to serve you up across the internet. TikTok started that trend in 2017. Facebook followed with reels and then the default feed was switched also for other platforms. And what we find then is that anger tends to dominate.
Ed Coper has a book called ‘Angertainment’, in which he argues that online anger is like measles, that we’ve got a natural preference for extreme negative moral emotions online. If you post about a policy saying that it is utterly outrageous and gut wrenching, it’ll get more shares than if you say it’s the wrong policy but might have come from a good place. Social media is a bit like the guy in the corner of the bar shouting ‘Fight, fight, fight’ every time people are trying to have a sensible discussion.
Delaney:
You’ve also pointed out that anger itself is not necessarily wrong, it depends on what you’re angry at and why you’re angry?
Leigh:
Yeah, one of my favourite philosophers, Martha Nussbaum, makes this connection. She talks about righteous anger – anger which is about redressing a wrong, whether that’s environmental or social justice – versus retributive anger in which you’re trying to hurt somebody else. And she said that kind of payback anger is bad for our souls and that’s the kind of anger that tends to proliferate online. Anger that suggests that if only we can tear the other person down, we can build ourselves up. That suggests that any gain for women has to come at the expense of men. That suggests any benefits for the environment has to come at the expense of business. It’s the kind of anger that drives zero‑sum thinking which is so harmful to good politics.
Delaney:
So we’ve reached the point where in public discourse, it appears that, as you said last night, opponents become enemies and traitors. Not just wrong, but illegitimate. And we’ve seen that in public discussion now for quite some time where the other side, whoever the other side might be, is denigrated, demonised and dehumanised. How has that happened?
Leigh:
Yeah, that’s partly the way in which the algorithms work and we see this in experiments which operate online. If you give people more partisan, hostile posts, they’re more likely to share them and they’re more likely to begin thinking that the other side are wrong and evil. As we step out of that face‑to‑face interaction we’ve got fewer opportunities to get together and rub shoulders with people who think differently about politics than ourselves.
That means that if you’re not going along to a sporting game or to a church service, then you might miss the opportunities to hang out with someone who has a different view than you, which encourages you to see the world in a more subtle way. We get too caught up in our own little echo chambers online, and that’s not only driving anger in politics but also anger between men and women as well, which is rising fast.
Delaney:
Now, you’ve pointed out that there is quite a lot of evidence mounting about the impact of not only online discourse but how that has overflowed into the real world, or ‘IRL’ as people call it now ‘in real life’. And it’s impacting not just political debate but also there’s been a really significant change of direction in terms of misogyny. It was something where men were becoming more progressive, generation after generation and all of a sudden in this current generation, the evidence is that’s turned around?
Leigh:
Yeah. If you ask Gen Z males whether feminism should be resisted with violence, 23 per cent of them say yes which is a bigger share than Boomer men. We’ve seen more engagement with manfluencer and misogynistic content and that has meant that the gender attitudes of 20‑something men are now quite similar to the gender attitudes of 70‑something men. It is again Leon, this is zero‑sum thinking that the gains for women have to come at the expense of men and you see that with incels, with pick‑up artists, with the red pill community and the blaming of women for challenges faced by men.
At the same time, you’ve got the rise in violent pornography, which is spilling over into everyday life. Three out of 5 young women now say that they’ve been choked during sex and we’ve got a lot of young men watching pornography which is containing violent aggression. Almost all of it directed towards women. So we’re seeing the effects not only spilling out into political anger in the real world, but also anger between sexes.
Delaney:
Yeah. Now you’ve pointed not only to the mounting evidence and the research that has been done of the impacts of these things. You’ve also asked the question ‘What happens when we step away?’ And the evidence there is that social media exposure is diminishing our well‑being and stepping away from it can improve our well‑being. And that’s led into another activist you have quoted that we are at a ‘Tech’s Tobacco moment’, where the companies have denied responsibility and cited such ideas as personal freedom of choice, which is exactly what the tobacco industry used to do. And you’ve led into the government’s proposed Digital Duty of Care legislation. Can legislation actually change the course of human behaviour in this case?
Leigh:
Well in this case, what we want to do through the ‘My Feed, My Way’ approach is to say that people ought to have a choice of seeing a feed which is dominated by their friends’ content, or a feed which is dominated by strangers chosen by the algorithm. If you want the algorithmically‑chosen feed, it’s your perfect right to have it. But we shouldn’t be in a situation as we are now in which that is the only feed that it serves up to you. And if you choose a friends‑based feed, the platforms default back to the algorithmic feed next time you open the app.
That’s driving more anger, more disengagement from a community because the platforms know that that algorithmically curated feed is a more addictive one, which gets them more ad revenue. But we have good evidence from randomised trials: when people log off for a bit more, they come back happier and more positive. They spend more time socialising with family and friends. They’re more the kinds of people that I think most of us would like to be if we weren’t stuck on these doom‑scrolling addictive devices.
Delaney:
Yeah. It’s a very strange time to be alive, isn’t it? I want to shift gears and ask a totally different question on a totally different topic for a moment.
Leigh:
Sure.
Delaney:
Recently, of course, the government was telling us all that we’d be better off after the surcharges on credit cards and debit cards were abolished on 1 October. Now, there’s been some debate about whether or not we are actually better off, but how about this? I’ve been given a letter that has been sent by Westpac to its customers that says ‘New rules introduced by the Reserve Bank of Australia on 1 October changed the way credit cards work for businesses and customers. As a result, we want to let you know about some upcoming changes to your credit card’.
Now the changes are listed here. ‘When you pay for something using your credit card, retailers can no longer add a payment surcharge’. Well, that’s fine. ‘So we’re making some updates to your card following these changes’. And here are the changes; The interest rate for purchases has gone up by 3 percentage points from 20.99 to 23.99 effective 30 November. The cash advance rate has gone up by 2 and a quarter percentage points from 21.99 to 24.24 and the credit card fee, the annual fee, has gone up from $30 a year to $45 a year. Banks are just charging us more. I don’t think the idea has worked?
Leigh:
Well the point of this reform, Leon, was to ensure that there was one price. That if you saw a price on the shelf or online, then that was actually the price that you paid. People were getting sick of having an additional charge at the checkout. So the Reserve Bank, working with the government, did 2 things. First of all, banned those card surcharges and secondly capped the interchange fees to save some $910 million dollars for small business.
That then ensures that businesses pay less in order to use the credit cards and gives us a level playing field. And it was always the case that about 84 per cent of businesses were not charging these surcharges. I think for those businesses who haven’t been charging surcharges, they’re welcoming the fact that they’re now operating on a more level playing field.
Delaney:
Okay, but the bank is apparently charging its customers higher interest and higher fees and they’re blaming it on the federal government’s changes?
Leigh:
It’s entirely up to banks as to how they set their charges. What we’re doing is ensuring that people have a clear price at the checkout and that they’re able to comparison shop. A competitive market works when there is one price, when there’s not sneaky charges added on. We’ve reformed drip pricing in order to ensure that when you’re buying, say, concert tickets, you can’t be slugged with an additional processing fee at the end. And the ban on credit card surcharges works much the same way. We want to make sure that when you get to the checkout, that you know the price that you pay. So this is fundamentally about price transparency and bringing down some of those interchange fees that have gotten too high.
Delaney:
Okay. Why are banks allowed to charge annual fees and monthly fees and all sorts of other fees when they’re already charging exorbitant rates of interest on those card facilities?
Leigh:
Because we live in a capitalist society and the government doesn’t set prices. There is an alternative, right? I mean, there are economies around the world in which governments fix prices for a whole range of things –
Delaney:
Okay, but isn’t this cartel behaviour when all the banks charge you excessive interest rates, which is almost 20 per cent above the actual cash rate?
Leigh:
Look Leon, you’re asking a big philosophical question which is ‘Should we move to a system in which governments set prices?’ There are a range of countries that have tried that. It has not generally worked out well for consumers. So the capitalist system in which firms are able to set prices and consumers compete is the system that has brought us great prosperity over the course of human history.
Delaney:
Yeah. Well I know recently we’ve spoken about supermarket price gouging. Isn’t this just big banks’ price gouging – charging 24 per cent interest on your credit card?
Leigh:
Well, I would encourage people to shop around and also to pay your bills on time. I mean, that interest rate is one which is paid by a relatively small share of people. I was looking at a recent bill which told me that if I paid the minimum amount each month, it would take me 93 years to pay off the bill. So you would be wise to pay your credit card bill. That’s advice that any financial adviser will give you. And if you’re going to carry a balance, shop around and find a credit‑card provider which is offering you the best deal.
Delaney:
Andrew, thanks very much for your time today.
Leigh:
Thanks very much Leon.
Delaney:
Thank you. Dr Andrew Leigh, the Assistant Minister for Productivity, Competition, Charities and Treasury, and of course our local member for the federal seat of Fenner.