Jason Falinski (Mackellar, Liberal Party) Share this | Hansard source

Thank you, member for Fraser. I say this quite sincerely: I am someone who loves finance. From a very early age, I was someone who got compound interest. I was someone who understood the important role that finance can play in a modern society. It has done more to set people free and improve the lives of the downtrodden and the vulnerable than any other invention in the history of humanity. When William Pitt was asked how did he win the Napoleonic Wars, most members of the House of Commons expected him to answer: 'Why? It was Horatio Nelson that won it for us.' He said, 'No, no, it was the government bond market, because without that I could not have been able to fund the war.'

In the state of Alabama in the United States, some technical laws that they introduced in the mid-1980s didn't allow credit bureaus to exist or do their work the way the modern credit bureaus do. The result of that was that it impoverished the very people who it was meant to protect. People on low incomes, people who didn't have assets and people from marginal communities found it impossible to get even small loans so that they could get out of the circumstances into which they found themselves or into which they were born. When they reformed their credit bureau laws and allowed credit bureaus to do the role and the work that they should do—that is, using computers and models to allow financial institutions to make assessments on what sort of financing people could do—they found a growth in capital, they found a growth in loans and they found that the rate of poverty declined absolutely and completely.

There are three types of market failure. The first type is unpriced externalities, where somehow you are getting something for free that is actually costing someone else a lot of money. It's best described as the free-rider effect. The second is asymmetric information, where people are basically buying a good from a seller who knows a lot more about what they're being sold than the buyer. And the third, of course, is regulatory failure.

I have listened to the Labor Party during this debate, and I have to say I've been appalled. Instead of using this as an opportunity to point out how we can use one of the greatest inventions in the history of humanity to further help those who are impoverished to be able to stand on their own two feet, how we can take people in marginal and vulnerable communities and give them the opportunity that all of us, or many of us, in this chamber got simply by right of birth and provide that to them, they have come in here to criticise those on this side, who hold their donors to account. If there is a bigger clown in this chamber than the member for Bruce, I don't know how that is possible.

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