In an era of stagnant wages, intergenerational divides and increasingly concentrated wealth and opportunities, the current policy consensus is neither fair nor is it working for a growing segment of the world's population.
A recent Pew Global Poll found 52 per cent are not satisfied with the way their democracy is working. For many, the status quo means a future that is not better, with a majority believing that quality of life for young people will be lower than that of their parents.
Australia is no exception. That same poll found that 41 per cent of Australians are not satisfied with how democracy is working here and that less than half of the country has a lot of trust or somewhat trusts that the national government will do what is right for the country. Over two thirds of Australians believe children today will be financially worse off than their parents.
The dissatisfaction and concern about falling living standards for future generations is leading to longstanding policy assumptions being rethought, and nothing symbolises this more than tertiary education. Across the world over recent decades there was a shift towards user-pays in tertiary education. That is now being reversed.
The platforms that British and New Zealand Labour took to elections this year show this understanding emerging, with both having policies to make education free once more. Even Hillary Clinton took a tuition-free college plan to the last US presidential election. It is time for Australia to follow suit.
In Australia, the argument for income contingent loans for higher education was that it financed the expansion of higher education, and that public funding is otherwise mainly subsidisation of those who are better off, who would go to university anyway and become better off still. The mantra was that a tertiary education would lead to substantially better life financially.
However, with degree inflation in combination with stagnant wages and rising house prices, students are racking up debt without it necessarily leading to a life that is materially better than that of their parents. Many fear that this will result in the first generation that will be worse off than their parents since the Second World War.
"Higher education is no longer the ticket to a much better life because of the precariatisation of formerly middle-class 'white collar' professions."
Though under the present regime payment only occurs when a certain salary threshold is met, the psychological impact of that debt cannot be underestimated, particularly in light of soaring house prices. It fundamentally damages the compact that private payment for tertiary education