Posts Tagged ‘Australian Labor Party’

A frightening abyss

October 21, 2014

Political funerals are naturally light on candour and heavy on encomium, a polite sponge applied to the deceased’s public record.

Such prettification, in an Australian Labor setting, typically does without much elevated language  the latter being beyond whichever dim leading lights of today, and fossilized contemporaries of yesteryear, have been selected from among the assembled personages.

Bureaucratic droning is the standard official tribute.

Honest political testament, and quivering oratory, is best sought elsewhere.

In October 1975, Clyde Cameron, a senior member of the Whitlam Cabinet and back-room powerbroker for the ALP Left, delivered a remarkably frank, unvarnished speech in the House of Representatives.

With explicitness born of desperation, he described the role of the Australian Labor Party and trade unions in preserving the existing institutional order from those who would menace it.

Cameron beseeched the conservative Opposition (and the propertied classes) to see reason, explaining that removal of the Labor government threatened ‘total collapse of the parliamentary system of government’ and victory for the unruly, repugnant ‘mob’:

The people are many; the moguls are few. Yet it is the representation of those privileged few who have brought us to this very brink of mob rule. A frightening abyss is certainly before us now…

Without parliamentary democracy what is there? Why should the masses tolerate this mockery of democracy? What will prevent the masses from becoming a mob and what will then stand between the classes of privilege and the mob once the institution of parliament is destroyed? Who will then man the powerhouses, the oil refineries and the transport systems? Who then will man the ships, mine the coal and man the wharves? The Opposition cannot do that with guns and bayonets. It cannot do that with its wealthy racketeer friends. Revolution does not ever happen until some spark ignites the dynamite. The steps which the Opposition has now taken could be the spark that will bring down all the institutions in this country.


Parliament does not derive its strength, its authority, its respect and power from the shell of masonry that carries the name of Parliament House. Nor does it derive its power and respect from the people who sit in its chambers; it derives its power, respect and authority from the fact that people identify Parliament with a whole wide range of ancient traditions, conventions and principles without which it can no longer act as the barrier between our present way of life and the mob which would seek to change it. And yet, it is they, the privileged sections of the community and the Press barons, who have most to lose from the destruction of the present system. They, the Press barons, the mining magnates, the foreign-owned multinational corporations, the ruling classes generally, the barons of business and the privileged classes are now urging the Opposition to embark upon the course of action which will destroy the only bastion which stands between them and the mob.


Once working people see that their chosen governments are not to be allowed to govern, what is it that will stop them from responding to those memorable lines of Percy Shelley who, in conditions very much like those which will apply when the collapse of the parliamentary system occurs, made this clarion call to the men of England:

Rise like Lions after slumber

In unvanquishable number

Shake your chains to earth like dew

Which in sleep had fallen on you-

Ye are many they are few.

This Parliament stands between the rule of the mob, the law of the streets and society as we know it and have enjoyed it throughout our country.

Thereafter, dumped from power despite its importuning, the Australian Labor Party would play its perennial role, as sturdy protector of ‘the institution of parliament’ and ‘society as we know it.’

Very late in life, Cameron joined Socialist Alliance.

His trembling evocation of the mob, given rare expression in Canberra (an urban environment designed to exclude the popular citizenry), was common in nineteenth-century literature. The riot scenes of Dickens and Zola record the physical terror inspired by dense populations of workers and artisans unleashed from authority.

Today, however, the imagery of stormed palaces has become somewhat tattered and remote — and the toppled statue is now a kitsch trademark of US-engineered regime change. Nonetheless, fear and contempt for the ‘masses’ endures, finding an outlet in supercilious journalistic sneering about moral panics and ‘populism.’

Yet isn’t such demophobia pointless, after three decades of relative domestic social peace, if not outright quiescence, in the advanced economies?


Why has the governing elite of this country recently invested so heavily in the machinery of repression (administrative detention, ‘control orders’, military call-out powers, engorgement of police and intelligence agencies)? Why erect such bastions and barriers between ‘our present way of life and the mob which would seek to change it’, when the latter are so disorganized, discredited and demoralized, and in any case no longer possess in any great numbers a coherent vision of an alternative society?

Some clue to this development is found here, where I describe Steven Pinker’s fondness for state violence, the latter approved as a queller of rowdy passions from below:

Mounting a consistent and effective defence of property rights nowadays compels the honest ideologue to adopt such a position [pragmatic authoritarianism].

For if ‘gentle commerce’ transforms ‘zero-sum warfare into positive-sum mutual profit’, this same growth of productivity and cooperative non-rivalry (i.e. the necessity for team production by co-workers in factories and offices) also raises the costs of excluding non-owners from access to resources and enforcing private claims to wealth.

In today’s Garrison USA, it takes more than one-quarter of the labour force (up from 6% in 1890 and 7% in 1929) to maintain order and to enforce the existing allocation of ownership claims over economic resources. A colossal number of citizen-soldiers now work as supervisors with the authority to discipline, sanction and fire, or as prison guards, private security personnel, employees of the military, lawyers, etc.

This is what mainstream economics calls the ‘technology of conflict’, in which resources are devoted to enforcing, adjudicating, seizing or redistributing private claims to social wealth.

At the heart of US society beats a massive disciplinary apparatus, public and private.


Leaning in

April 8, 2013

In Australia, the ascent of a female prime minister has brokered an open, passionate embrace of the parliamentary order by several ex-radicals and self-described socialists. Few hints of restraint or scruple are apparent.

The governing party, in turn, has mobilized these feminist courtiers and thrust them to media prominence. With its traditional sources of electoral appeal now exhausted, the ALP plainly seeks, in imitation of the US Democrats, to convert women into a reliable vote-bank, and make its own leader into a celebrity object of adoration.

Thus, in the glare of Klieg lights purposefully re-positioned, feminist intellectuals now operate as canvassers, vote gatherers and general-purpose ideologues, churning out a partisan stream of commentary, advocacy and encomium on behalf of their Labor patron.

The Monthly - March 2013

Let me give two examples of this phenomenon before trying to explain it.

In 1978 Anne Summers wrote a brief piece in Hecate about Adela Pankhurst Walsh.

The first Women and Labour Conference had just been held at Sydney’s Macquarie University, organized by labour historians including the ex-Stalinist Ann Curthoys.

Summers, like Curthoys a founding member of the Refractory Girl collective, observed a renewed interest within these circles for the ‘unwritten history’ of ‘Adela Pankhurst Walsh’s own intellectual odyssey from her espousal of militant feminism to her decision to reject it and devote most of her energies to the socialist movement.’

Miss Adela Pankhurst - Trades Hall

war and revolution

In those days Hecate sought what it called ‘contributions employing a marxist or radical methodology to focus on the position of women in relation to capitalism and patriarchy.’

The journal’s founding editor, the Queensland academic Carole Ferrier, helped to establish an Australian section of the so-called International Socialist tendency (to which she apparently remains devoted).

Hecate‘s deputy editor, historian Carmel Shute, was a member of the Communist Party until its 1991 dissolution. Having worked as a union official, she later ran her own PR firm before most recently moving to the National Tertiary Education Union.

Ferrier’s editorial in Hecate‘s third issue (January 1976) noted:

‘Women’s Liberation’ has become big business… Not surprisingly, up-and-coming academics, both female and male, have not been slow to leap upon the profitable women’s studies bandwaggon. Utilizing the increased funding and research facilities available in this field, they are spawning a diverse array of data and theoretical material about the position of women.

Regrettably, one must entertain serious doubts about the worth of many of the new intellectual endeavours that are engaged in under the aegis of feminism. For some academics they provide a fashionable and not too difficult means of ascending the academic ladder.

By 1983, as if to prove the point, Bob Hawke had taken Anne Summers on as an adviser on the Status of Women. By 1987 she assumed the New York-based editorship of Ms. magazine, after Australian media firm John Fairfax Publications acquired the struggling title.

Summers immediately aligned the magazine, now run as a for-profit concern, with the US Democratic Party.

Yet what Summers’s website proudly describes as  ‘the second only women-led management buyout in US corporate history’ quickly ended in commercial failure, and Summers returned to accept induction into the Order of Australia and work for Paul Keating’s 1993 election campaign.

Speaking later in an interview from ‘her Upper West Side condominium’, Summers explained that Ms. had needed an update for the 1980s and 1990s.

Under her control, the magazine sought to be ‘a player on Madison Avenue as well as Capitol Hill’:

I think a lot of women, as they started to get good jobs, started having kids, saw themselves developing in all kinds of ways the magazine wasn’t keeping up with. I thought there was a constituency out there I could claim.

More recently Summers has returned to media prominence as an opponent of the ‘political persecution of Australia’s first female prime minister’. She complains that ‘sexist and discriminatory treatment’ (including use of the epithet ‘liar’ to describe Julia Gillard) seeks to ‘undermine her authority as prime minister’ and ‘assault her legitimacy’.

It would be wrong to understand this as merely the natural idiom of la gauche respectueuse, of pleas from the journalistic insider to respect the ‘dignity’ of ‘the holder of our highest office’.

The impulse behind Summers’s appeal is more tawdry.

For neither Gillard’s personal qualities nor her government’s political record suffice to invite loyalty, let alone giddy engouement, from anyone who self-conceives as a feminist.

Even invested with the authority and mystique of office, she is devoid of the magnetism, conviction or aplomb that might otherwise have allowed her to personify female triumph over gender prejudice or any other uplifting popular identification. Nor has her government been willing to dispense the socio-cultural confetti of lifestyle and mores, the sops of symbol and ‘values’ (marriage, faith, etc.), necessary to propel culture warriors into the ALP camp.

Electoral support for the female prime minister (whom Summers renders as ‘CEO of Australia Pty Ltd’) must therefore be motivated by eliciting sympathy for her mistreatment at the hands of sexist enemies.

The appeal is purely negative. As with Hillary Clinton in 2008, Gillard’s sole contribution is her putative ‘toughness’ in the face of unfair attacks.

Now to the second example.

In 1987 Carole Ferrier, Carmel Shute and Zelda D’Aprano (former CPA member) joined a colloquium in the Communist Party’s Australian Left Review, along with the feminist historian Marilyn Lake.

Described as a ‘well-known activist’, Lake was to expound on ‘the current state of socialist feminism’.

In her piece, she referred derisively to ‘femocracy’ as the ‘the public face of feminism in the 1980s.’ Women were divided by social class, she said, and one ‘cannot help but wonder, in the Australian context, to what extent some Affirmative Action strategies are facilitating the “inevitability” of this hierarchy.’

‘Socialist feminists’, declared Lake, ‘must learn how to bargain with the men in the socialist movement, for socialist feminism must continue to grow.’

In 2013, Lake no longer publicly evinces interest in ‘building a socialist movement with men’ or without them.

Instead she has used a recent column in Fairfax newspapers to write, like Summers, about the widespread hatred for Labor prime minister Gillard.

Lake’s defence drifts into  putting it politely  cloying boosterism:

The future belongs to Gillard, Tanya Plibersek, Penny Wong, Bill Shorten, Greg Combet, Mark Dreyfus and others with talent and forward vision. It also belongs to politicians who care about more than themselves and their careers, who care about climate change and the environment, as Combet does, who care about disability insurance, as Shorten does, who care about the state of our hospitals, as Plibersek does, and who care passionately about access to education as our Prime Minister does.


Enough is enough. It has been exasperating for many of us, as citizens without power, to watch helplessly as this campaign of denigration dragged on and on. Journalists seemingly too lazy or unimaginative to investigate policy innovation, larger contexts, new ideas or broader social and economic change seem to rely wholly on polls for their subject matter and many seem personally obsessed with destroying Gillard. She has been subject to sexist attacks and unwittingly called up the misogyny that lies deep in Australian culture, brought to the surface by the terrifying sight of women in power.

Little wonder that men still dominate those other august institutions, the military, the churches, the press and our universities.

When some people speak of Prime Minister Gillard they do so with the particular contempt and dislike they usually reserve for women. People often spoke about Margaret Thatcher in the same way…

As the Prime Minister displays extraordinary grace under pressure, as she continues to govern the nation in the face of incessant attacks, as she shows admirable commitment and clear-sightedness, male commentators now move to deplore her toughness – an admirable quality in a man – suggesting surely that it is unbecoming in a woman. But Gillard doesn’t only have strength, she has compassion and good humour. And she knows that most women and fair-minded men support her in her program of change and her vision of a fairer society.

The career trajectories of Summers and Lake, and their recent media interventions, ought to raise a number of questions.

In the first place, why are such not-very-clever ideas springing to the mind of eminent academics and intellectuals, and why are they being given an airing in centralized media platforms right now?

Ultimately, it is because traditional labourism and social democracy have outlived their usefulness and are defunct.

Intellectuals whose career fortunes are bound up with those of the Labor Party have made large sunk investments that they cannot easily redeploy. New patronage networks are hard to find. Mindful of the need to safeguard their professional assets, these ageing intellectuals must invent new reasons for the moribund entity (the ALP) to survive.

The historical basis for social democracy  conditions in which wages and salaries could rise apace with labour productivity, preserving a constant share of value added for employee compensation  has long since evaporated.

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Mohun - Oz real wages and labour productivitySince no later than the mid-1980s, the activities of labour parties and union officials have therefore been openly inimical to the interests of employees, their dependents and the vast majority of the population. Cast to the winds have been the fortunes of every segment of society besides a tiny financial oligarchy and an upper-salaried layer.

The former mass membership of trade unions and the ALP has been hollowed out and the organizations reduced to corrupt shells.

trade union membership

The bourgeois state accordingly needs other ideological supports and mystifications to perpetuate its rule. Political institutions that now rest on an unprecedentedly narrow distribution of wealth and social power must, to sustain their own existence, secure the fealty of other, less traditional social layers.

Among these latter-day helpmates of the ruling elite are the ideologues and activists of feminism.

In Australia, the embarrassingly toadying efforts of Summers and Lake attest to this, as does the success of Julia Gillard’s contrived ‘misogyny’ speech in inspiring a dutiful and fawning response hailing a so-called ‘new wave of feminism’.

For these writers and academics, the task of applying a ‘progressive’ gloss to the political establishment presents, as Hecate wrote in 1976, an opportunity for new sources of earnings and career advancement.

In return for the anticipated rewards of clientelism, they provide a reliable constituency or voting bloc. Their elite patron finds this support useful not just for partisan electoral purposes, but more fundamentally as a guarantor of social stability at a time when Australian authorities are preparing for a decade-long decline in popular living standards.

Eisensein - Oz femocrats

This brings us to a second question. What does degeneration of these intellectual seers (Summers) and avowed radicals (Lake) into shameless vote-gatherers and canvassers for the ALP say about the political movement of feminism as the latter grew out of Women’s Liberation, antiwar protests and the New Left?

Conventional opinion  where it does not simply welcome such individual journeys towards political moderation as examples of inevitable maturation and coming to one’s senses  ‘explains’  them as mere apostasy.

What, after all, is more familiar than the betrayal of youthful convictions?

But this media and scholarly commonplace exaggerates how much danger was ever posed by the intellectuals of the New Left and activists of the ‘new social movements’. Despite their bloodcurdling slogans, the latter were always politically harmless and were known to be so by their most canny patrons among the ruling elite.

As clear-eyed servants of the political establishment would have discerned, the booty of middle-class ‘inclusion’  a few academic posts, access to the professional salariat and positions in the middle ranks of the public service  would be enough to satisfy the most intransigent of sex-based demands. These spoils of office, accruing to a few women, would be presented as gratifying symbols of esteem for them all.

To serve this purpose, institutionalized rent-sharing did not need to be the explicit goal of the entire group (i.e. it did not need to accommodate the wishes of all or even most feminists, as of course it did not). Such a program was simply the logical outcome of group-specific politics, and the point beyond which it could not progress: the maximum that could be achieved.

Today, if one sorts Australian full-time non-managerial employees by mean weekly earnings, the lowest-paid occupations are still typically filled by women: textile, clothing and footwear trades, hairdressers, childcare workers, checkout operators, cleaners and laundry workers, receptionists, food-preparation and hospitality workers.

Curthoys, probably the most astute and intelligent of her milieu, noted in 1984 that ‘many feminists are anti-male in a crude sense, are simply seeking their own advancement vis-à-vis middle-class men, have abandoned socialist ideals and organizations, and are out of touch with or unsympathetic to the very real problems of working-class people, both female and male’ (emphasis in original).

Of course by 1988, having herself re-examined the ‘shibboleths of the left’ in an academic discussion group, Curthoys declared that she was now persuaded by Alec Nove’s vision of market socialism. She hoped to ‘reconcile public ownership with competition and the operations of the market.’ (In 1987 the Kremlin bureaucracy, in whose orbit Curthoys’s early political formation took place, had enacted a Law on State Enterprises that conferred managers of state firms with decision-making autonomy. This reform would quickly lead to full privatization and capitalist restoration in the Soviet Union.)

This concession to political fashion was instructive about more than just Curthoys’s own political background, ideological unmooring and personal demoralization (‘the perspective of the traditional left’, she announced, ‘has lost persuasiveness in recent years’).

In scrambling to stay just inside the left-most boundary of respectable public opinion as the latter rushed swiftly rightward, Curthoys was being true to form. In doing so she divulged the social character of the broader enterprise that she and other feminist intellectuals had long been engaged in.

Today the behaviour of Lake and Summers discloses the truth about their feminism even more unsparingly: it is a kind of abject truckling for favours, in which fortunes (media profile, recognition from one’s peers as someone intellectually fashionable, advisory gigs, perhaps even a pensionable job in the state bureaucracy) depend on maintaining the favour of the wealthy and powerful, or joining their ranks.

Speaking on behalf of his ‘own class… the educated bourgeoisie’, and as a pioneer of ‘novel measures for safeguarding capitalism’, J.M. Keynes observed in his General Theory:

[Dangerous] human proclivities can be canalised into comparatively harmless channels by the existence of opportunities for money-making and private wealth…

Liberal ‘policymaking’  as it’s pursued and carried out by lobbyists and technocrats in think tanks, government agencies and pressure groups  is chiefly a matter of tinkering with markets through subsidies, taxes and legislation to shift economic surpluses between groups, transferring rents from one set of interests to another.

All political ‘movements’ that look to the bourgeois state for salvation thus ultimately become vehicles for rent-seeking.

From time to time, ruling authorities accommodate the redistributive demands of a particular constituency (e.g. an industry, class fraction, social layer or ‘interest group’). The latter will then be done the honour of being indulged by ‘progressive’ public opinion.

Spokespeople and ideologues responsible for articulating group aims will suddenly find themselves the subject of media fascination and patronized by the powerful. They will be invited to write newspaper columns, give convivial TV interviews, make submissions to parliamentary inquiries and have tea at the prime minister’s residence.

Whether in the name of social stability and preserving a fragile status quo, or of reformist meliorism, journalists and academics will begin to rail against the exorbitant privileges won by other powerful but narrow groups (mining companies, large landowners, financial institutions, sugar growers, pharmaceuticals corporations, professional doctor’s guilds).

These ‘special interests’, it will now be admitted, have long sought to influence state policy (e.g. tariffs, patent law, monetary policy) to garner for themselves a larger share of the pool of property income. Why not the little guys: small proprietors, manufacturers of solar panels, etc.?

Piously a broader share of the spoils will be demanded, with other industriesclasses and social layers getting their ‘fair share’ of the pie.

Even the apparently ‘radical’ or subversive varieties of such movements, the most sensationally ‘militant’ and incendiary activities of comparatively subaltern groups, conform to Marx’s 1850 verdict:

The democratic petty bourgeois, far from wanting to transform the whole society [by which he meant overturning property relations of employment and private ownership] … only aspire to a change in social conditions which will make the existing society as tolerable and comfortable for themselves as possible.

Masquerading as democrats, egalitarians, reformers, patriots and even socialists, such groups pursue privileges and wheedle for favours: the laurels of officialdom and government-service jobs, dedicated seats in parliamentary chambers, advisory posts and commissions, entry to the liberal professions and senior management positions, admission to higher education which serves as a passport to those jobs, favourable credit terms, academic chairs, property rights, procurement contracts, monopoly rights and commercial licences, etc.

Modern feminism (as distinct from the struggle for women’s rights and equality) is unblushingly a variety of this. Its gurus and cynosures aim to carve out for themselves a lucrative niche in existing society, rather than to transform the latter’s basic economic institutions, such as household labour.

Like ethnic identity, sex is an excellent device for political mobilizations, since its defining characteristics are easily identifiable while group entry and exit are restricted.

But increasingly the figureheads and hacks of feminism also play something more than a mercenary role. While pursuing their own careerist goals, they have become crucial bulwarks for existing society and its political institutions.

A sticky end

December 6, 2012

Historians of Australian Stalinism and social democracy can be grateful for the Julia Gillard/AWU ‘slush fund’ matter. As part of the continued media and parliamentary attention, more details about the Socialist Forum have become publicly accessible.

The far right-wing former 2UE presenter Michael Smith has used his blog to post (here and here) the group’s collected papers, which are stored in the University of Melbourne archives.

In a previous post I discussed the origins of the Socialist Forum, born during the mid-1980s amid the organizational deliquescence of Australian Stalinism.

bernie taft

The immediate occasion for the latter was the support of Stalinist union officials, especially in the Metal Workers Union (AMWU) and Building Workers Industrial Union (BWIU), for the ALP-ACTU Prices and Incomes Accord, which was struck in February 1983.

Like the CPA, the pro-Moscow Socialist Party of Australia also split in 1984. Those supporting the ALP’s ‘income policy’, including the BWIU’s Tom McDonald, Pat Clancy, Bill Brown and Stan Sharkey, left to form the Association for Communist Unity.

This latter epithet was meant to signal the SPA union officials’ rapprochement with friendly elements in the CPA and ALP left.

In 1982 Bernie Taft (Victorian secretary of the CPA and a member of the National Executive Committee) had called for a debate on the ‘prospects for socialism’ and the party’s future.

Following the direction set out in the CPA’s ‘pluralist’ 1979 program, Towards Socialism in Australia, the Aarons leadership group aimed for ‘renewal’ of their apparatus by attaching to extra-parliamentary protest movements like feminism, environmentalism and nuclear disarmament. Senior figures like Joyce Stevens cultivated ties with these activist circles by denying that social class held any political priority or theoretical primacy.

Taft, on the other hand, preferred to consolidate his influence by drawing closer to the parliamentary ALP and senior officials in the AMWU and maritime unions. His Victorian acolytes questioned whether there was space for the CPA as a distinct organization: rejecting ‘ultra-leftism’, ‘abstention’ and ‘obstruction’, they raised the prospect of Party dissolution with the aim of ‘regrouping’ in a new formation with Labor members.

In a 1983 article in the CPA’s Australian Left Review, ‘Marxism is Open Ended’, Taft approvingly quoted Engels’s 1895 words on ‘legal methods’ and ‘street fighting’, using it to dismiss both ‘insurrection’ and the idea that any single ‘rigid interpretation’ of Marxism existed.

Taft soon repeated the claim in a lengthy ALR update on Eurocommunism and the ‘democratic road to socialism’, following his 1983 tour of France and Italy. Meanwhile the AMWU state secretary John Halfpenny, a prominent figure in the Victorian CPA, had entered the ALP in pursuit of a parliamentary career.

Bernie Taft_Max Ogden

The Australian Left Review during these years makes astonishing reading.

Celebrity intellectuals Stuart Hall and Beatrix Campbell of the British CP’s Marxism Today appear in every issue (in written contributions, interviews, and brief notes providing personal facts about them). In 1983, with Derridean post-structuralism at the apex of its fashionability, the feminist historian Jill Matthews contributed an article arguing that ‘marxism is patriarchal at its core’. Matthews noted the ‘phallocentrism of marxism’s philosophical assumptions about Knowledge, Truth, Reason and Power’, and called for ‘a politics that takes women as central’. She concluded by instructing women to ‘fight against’ Marxism.

In April 1984 Taft departed the CPA with the rest of the Victorian State Committee, including his son Mark, Linda Rubinstein, Dave Davies and Roger Wilson (assistant state secretary of the Seaman’s Union and member of the CPA’s national executive). They pledged to form a ‘new, broad, socialist organization… New ways, new patterns of thinking and new methods of organisation are needed to meet the very real opportunities for socialist growth.’

The centrality of ‘democracy’ was repeatedly proclaimed  this term being used to signal the new Socialist Forum’s unswerving allegiance to the parliamentary ALP and to ‘negotiated agreements between the industrial and political wings of the labour movement.’

Mark Taft:

We’re talking not of an oppositional Left, but of a Left that intervenes in political and social decision-making. A Left that wants real change, not just minor tinkering with the social system. A Left that recognises the constraints of public opinion and puts up realistic and realisable proposals for social change…

People in the Left are openly discussing issues where they would not have done so before. Significant sections of the Left now believe in the strategic need for negotiated agreements between the Labor movement and Labor governments. Sections of the Left are now saying that mechanisms other than mere protectionism are necessary for industry revitalisation and the creation of a viable manufacturing base.

We need to have a mass conception of social change, rather than minority vanguardist conceptions. We need to recognise that change will come over time through reform based on majority popular support, not through revolutions, massive disruption and dislocation based on minorities.

Prominent members of the Socialist Forum included Gillard (former president of the Australian Union of Students), Jenny Macklin, Bernie and Mark Taft (the latter is now a Victorian County Court judge), Bill Mountford (then an AMWU research officer and CPA admin officer, appointed director of the Australian Manufacturing Council by John Button in 1988, later a partner at Arthur Andersen, CEO of the Victorian WorkCover Authority, and now a commissioner at the Victorian Competition and Efficiency Commisson), Bruce Hartnett (now chairman of the Victorian State Services Authority and a trustee of several superannuation funds), his wife Louise EinfeldLinda Rubinstein (a member of the CPA national executive, later a senior ACTU industrial officer, now manager of pro-bono work at Holding Redlich, and also a director of several industry superannuation funds), Wally Curran, Sue Mountford, Max Ogden (a long-time AMWU official and CPA member, eventually director of Melbourne University’s Foundation for Sustainable Economic Development), Philip Hind (then a director of the Australian Association for Armed Neutrality), Jim Frazer (Victorian secretary of the Australian Railways Union and a former CPA member), and Vern Hughes (later a co-founder of Stephen Mayne’s People Power and a ‘research scholar’ at the Centre for Independent Studies).

Other members included the CPA’s Peter Ormonde, Lesley Ebbels, Rivkah Mathews, John Sendy, Cathy Oddie and the Kiers family (Deborah Kiers was then a researcher at the Labor Resource Centre before joining, in 1989, an Australian Political Exchange Council delegation to the United States, winning a Harkness Fellowship and taking an MPA at Harvard, and is now at JMW Consultants, specializing in ‘alliance management’).

There was also Stefano de Pieri (ministerial advisor to the Cain government and later a celebrity chef), Candy Broad (née Strahan, then administrator of the Labor Resource Centre, later chief of staff for Joan Kirner, a key figure in the founding of EMILY’s List Australia, and a state minister in the Bracks and Brumby Victorian governments), Sara Charlesworth, Max Lorkin (AMWU official), Arthur Apted (now executive chairman of the Sustainable Agriculture Fund, a private investment fund that buys up rural property and manages farms), Bob Hogg (Hawke advisor, former Victorian ALP secretary and partner of Maxine McKew) and his then-wife Caroline (state MP), Andrew Dettmer (now Queensland AMWU secretary and state ALP president), Tony Lang (a partner at Slater & Gordon, now a Melbourne barrister and board member of the Victorian Council of Social Services), Shane Tregillis (later a capital-market regulator for the central bank of Singapore, then commissioner of the Australian Securities and Investments Commission, now chief of the Financial Ombudsman Service), Evan Thornley (then president of the Melbourne University student union, later a McKinsey consultant, founding director of the activist group GetUp and thinktank Per Capita, chairman of the online advertising firm Looksmart, Victorian Labor MP and now CEO of the electric-car firm Better Place), Michael O’Connor (Gillard’s successor as president of the Australian Union of Students and now national CFMEU secretary), John Alford (Monash University student unionist, then a research officer at the Railways Union, author of Gramscian articles on ideology in the ALR, now professor of public management at Melbourne Business School), Ben Kiernan, Charlie D’Aprano (former CPA member and ex-husband of Women’s Liberation activist Zelda D’Aprano), Kim Windsor (then a researcher for the Labor Resource Centre, now operating a management and ‘strategic change’ consultancy), Douglas Kirsner (once a New Left ‘Freudo-Marxist’ philosopher, these days an executive board member of the B’nai B’rith Anti-Defamation Commission), Grant Hehir (then a staffer to Labor-left MP Stewart West, now secretary of the Victorian Department of Treasury and Finance), Mark Burford (author of a 1983 article in the Journal of Political Economy called ‘Prices and Incomes Policy and Socialist Politics’, which argued that ‘socialists in the labour movement’ must support the Accord ‘as a policy that indeed has socialist components’, using it to pursue ‘socialist aims in the Australian setting’; later a senior administrator in the Victorian Department of Premier and Cabinet under Jeff Kennett and Steve Bracks, and an advisor to Julia Gillard; now a management consultant at Nous Group, and a board member of the ‘progressive’ think-tank Centre for Policy Development) and Bruce Wilson.

Julia Gillard and Mark Taft

Writing today about the Socialist Forum, the mainstream media and right-wing blogs make much of the group’s apparent wish to close the US signals-intelligence facility at Pine Gap and withdraw from the ANZUS Treaty.

In reality, Socialist Forum was part of the post-1975 repopulation of the ALP ‘left’ and union leadership with reliably US-aligned and Zionist figures (Bob Hawke being the most notable).

As with ex-‘revolutionaries’ like Joschka Fischer, former members of the Socialist Forum and Nuclear Disarmament Party would go on to make the most supplicant agents of imperialism. Those of them who achieved a Cabinet or senior civil-service position were eager to atone for youthful follies and clear up any lingering doubts about their trustworthiness.

Since the mid-1970s Washington, with the help of local intelligence services and far-right elements, had restructured the domestic leadership, external security alignment and economic policy of several other states, to bring them in line with its own objectives. (Among other things, this involved sponsoring or conniving at personnel changes within the ruling elites of close strategic allies. Examples include the replacement of the SPD’s Willy Brandt by Helmut Schmidt, and the destruction of Harold Wilson and the Bevanite wing of the British Labor Party, followed by the ascendancy of the Atlanticist Gaitskellite wing, and ultimately New Labor.)

Throughout the postwar period, Jay Lovestone and Irving Brown’s International Confederation of Free Trade Unions (and its Australian affiliate the ACTU) had been used as a ladder for cultivating suitably anti-communist leaders for social democracy and the ‘labour movement’. Likely sorts, having been identified, were brought on funded educational visits to the US to learn about ‘shared values’. This and other ‘leadership training’ was supplemented by personal contacts and scholarships, binding new generations of foreign state elites to Washington.

Since her time at the Australian Union of Students Gillard’s staunch Zionism was renowned it seems from reports to have been among her few abiding ideological commitments, invulnerable to her ‘ruthless’ pragmatism.

US diplomatic cables, written in 2008 and 2009 and released later by WikiLeaks, described her as a ‘pro-American’ who ‘has gone out of her way to build a relationship with Israel’, whose actions ‘indicate an understanding of [the US-Australian alliance’s] importance’.

Gillard had also ‘gone out of her way to assist the Embassy… Although warm and engaging in her dealings with American diplomats, it’s unclear whether this change in attitude reflects a mellowing of her views or an understanding of what she needs to do to become leader of the ALP. It is likely a combination of the two.’

Gillard, they noted, ‘recognizes that to become Prime Minister, she must… show her support for the Alliance with the United States.’ Now ‘a strong supporter of the Australia-US Alliance and Israel’, she was ‘campaigning for the leadership’ and ‘on track to become Australia’s next prime minister.’


This is the human nullity, the embodiment of a cynical and time-serving social layer, created by decades of Stalinism and labourism/social democracy.

During the 1980s the social role of such ‘labour movement’ bureaucrats changed, along with the structure of wage bargaining and other labour-market institutions.

Since the late 1970s, the worldwide bargaining power of employees had been reduced by a relative glut of labour and scarcity of capital.

The latter condition arose thanks to:

  1. The removal of capital controls;
  2. Vast new reserves of labour created by Chinese re-entry to the world market and urbanization across South Asia, Latin America and Africa, with higher agricultural yields driving farming populations away from the countryside;
  3. Reduced accumulation of productive capital goods (buildings, machinery, tools and other durable fixed assets) thanks to the absorption of a greater share of the surplus product by finance and other unproductive sectors;
  4. Technical changes that increased the ability of managers to monitor and supervise workers, strengthening employer control of the labour process and enforcement of the employment contract;
  5. The switch of private capital into profitable new lines of service provision (enabled by the privatization of formerly public functions and state assets) with low levels of capital per worker. This reduced the ‘holdup problem’ in which vast amounts of physical capital tied up in asset-specific investments had previously given employees leverage over management; and finally
  6. Following Gorbachev’s reforms, the Soviet bureaucracy’s turn to capitalism.

All this  above all the existence of vast pools of surplus labour  eliminated the old need for property owners to elicit the desired behaviour from workers by conferring sizeable rents (i.e. paying employees wage premiums well above their reservation wage, and providing security of employment tenure, well-defined promotional ladders and work amenities).

A relatively plentiful and immobile input (labour) thus lost all bargaining ground to a less abundant and globally footloose factor of production (capital).

With the long-standing basis for social democracy eroded, its paid stratum of full-time union officials, labour lawyers, party politicians and activists had to find alternative means to ‘fight for the workers’, perpetuate their tenure and preserve the social position it allowed them.

Since these privileges depended (as I’ll describe at the end of this post) on the survival and growth of a bureaucratic apparatus (the union, political party or centralized wage-setting negotiation venue), many of them tried, during these waning days, to clamber aboard elsewhere, switching to more vital organizations with more likely prospects.

John Halfpenny - Copyright - Swinburne College of Technology

Thus the careerists in the Socialist Forum, like those in Pat Clancy’s Association for Communist Unity, supported the ALP-ACTU Accord: the Hawke-Kelty project for ‘wage restraint’, revisions to ‘established work practices’, labour-market restructuring, and the de-registration of recalcitrant unions like the Builders Labourers Federation. (The CPA rump expressed only slightly more measured enthusiasm for the Accord.)

In itself, union-imposed ‘wage restraint’ was not unprecedented.

During the four decades after World War Two, in Australia, Israel, Austria, Switzerland, Finland, Sweden, Denmark and Norway, highly centralized systems of wage setting or collective bargaining (e.g. arbitrated national wages cases litigated by ‘peak’ union confederations such as the ACTU) had been associated with moderated wage demands, only slight increases to employee compensation and low frequency of strikes.

From 1973 Norwegian union officials had helped implement an ‘incomes policy’, providing ‘social consensus’ for reducing employee wages and salaries in that country.

In Australia, from 1975 onwards the Conciliation and Arbitration Commission, in response to joint claims from the Whitlam Government and Bob Hawke’s ACTU, had indexed wages to quarterly price movements. (In national wage cases, the full bench of the commission set minimum adjustments to wages and salaries for all employees covered by federal awards.)

Partial indexation had limited a breakout in employee compensation during the second half of the 1970s. Indeed, after increasing sharply in 1974, real wages had fallen in three of the five years after 1975.

But by the early 1980s this system began to break apart. Firms and unions engaged in decentralized bargaining, sometimes supported by strikes and militant action, that led to over-award pay rises being negotiated.

Protesting this lack of ‘collective responsibility’, the Arbitration Commission threatened to withhold national-wage increases from employees who engaged in industrial activity. Sir John Moore, president of the Commission: ‘Those who refused to comply with the rules should not expect to receive the benefits which flow from the rules.’

In July 1981 the Commission declared that centralized wage indexation was frozen, and it would not hear another national wages case until February 1982.

This only prompted more decentralized bargaining, including notably in the transport and metals industries. (The 1981 agreement negotiated by the AMWU, and ratified by the Commission, included a commitment by the union to eschew further claims during the life of the agreement.)

With the onset of recession, labour costs needed to be reduced. The concept of ‘trading off’ an increased ‘social wage’ for ‘wage restraint’ entered the lexicon of the Australian political left.

By 1982 Laurie Carmichael, AMWU official, CPA leader and member of the ACTU national executive, was arguing in the pages of the CPA’s weekly Tribune that union leaders should become involved in forming ‘economic policy’ and ‘labour-market planning’. This would be a kind of ‘political unionism’, superior to a strictly economistic focus on wage and salary negotiations.

The CPA began calling for a ‘comprehensive working-class incomes policy’. Carmichael suggested a tripartite council of employer organizations, government and the ACTU executive. (This proposal, borrowed from Swedish Social Democracy and Bennite Labour, would be realized in Hawke’s April 1983 National Economic Summit).

The CPA line thus became indistinguishable from that of the ALP under Bill Hayden, Bob Hawke and Ralph Willis.

Since its 1981 national conference Labor had included a prices and incomes policy as a central plank. The 1983 Accord negotiated between Hawke and Bill Kelty pledged ‘the maintenance of real wages over time’. This meant that employees must forego wage increases now with the promise that living standards would be made good later, perhaps by other means, after ‘economic growth’ and ‘industrial health’ had been secured.

Laurie Carmichael

As it turned out, via the Accord the labour bureaucracy acted as agent for an unprecedented transfer of wealth and social authority to the propertied classes, and for tighter managerial control over production. For these ongoing favours and for the concession of old negotiating turf (the centralized wage-setting apparatus was disbanded in the late 1980s), union officials would be rewarded with a new set of privileges and private benefits.

Above all, they took up board positions as trust directors for superannuation funds. This gave them control rights over enormous asset pools, allowing them to collude with fund managers, receive consultancy fees and other sources of earnings, establish personal contacts and prepare for parliamentary or business careers.

The ‘labour movement’ bureaucracy has long provided an institutional setting (a union apparatus, political party or negotiating venue) for an opportunist layer of union officials, labour lawyers and politicians to enjoy salaried positions, a degree of social authority and other private benefits and privileges.

Bureaucratic personnel are not able to privately appropriate (i.e. acquire legal title to) party or union assets, such as building premises, motor vehicles and equipment. Nor are they entitled to keep the net income generated by those assets. But, by virtue of holding office, they do acquire usufruct rights to various goods and services, and hold decision-making authority over assets and subordinates within the administrative hierarchy.

These perks of tenure (control rights over property and command over people) can be spun off into various privileges and income streams, e.g. lecture tours, fees for various paid gigs, sexual conquests. Personal contacts can be used to establish future career prospects in the civil service or private sector, etc.

Bureaucratic office and its private rewards can sometimes (as with the Aarons and the Tafts) became a type of private property that, though it can’t legally be alienated, may practically be bequeathed to offspring.

Such rents give union officials, party leaders and parliamentarians in the ‘labour movement’ an incentive to perpetuate their tenure. It also provides them with incentives to consolidate and enlarge the apparatus itself.

This they can do by maximizing the number of recruits, dues-paying members and devoted followers: increasing population coverage (e.g. union density) or maximizing for example, the proportion of a workforce, electorate or labour pool (firm, industry, trade or national labour market) governed by union-bargained contracts that set wages.

Union officials and labour activists, who can expect favours (consulting, advisory or lobbying roles, etc.) to accrue from a labour or social-democratic government, also have reason to encourage electoral or political support for reformist parties.

Once upon a time, labour bureaucrats preserved their apparatuses and their privileged positions by talking about socialism (e.g. the AMWU’s Carmichael or the BWIU’s Clancy) or proclaiming their undying fight for the welfare of employees. Sometimes they did it by actually capturing, via negotiations, a rise in real wages in proportion to labour productivity, thus maintaining a stable or increasing share of value-added for employee compensation.

Of course, for these labour bureaucrats, preserving their own careers and durable flow of rewards always depended on the enduring existence of the social relationship of employment, based on the unequal distribution of property rights (i.e. on socialism never actually arriving), and on employees never acting independently of their ‘representatives’.

Keeping a lid on it: maintaining political stability under austerity conditions in Australia

October 7, 2012

As described in the previous post, Australian’s business press has recently featured several prominent communiqués from the economist and Labor government advisor Ross Garnaut, declaring that the coming decade must bring a decline in popular living standards.

Lower wages and salaries and ‘public fiscal restraint’, insists Garnaut, will be maintained over a ‘long period’.

Local ruling layers  for whom the economist’s media bulletins serve as a spine stiffener  should therefore ‘brace’ for ‘difficult times.’

Luckily for its purposes, Australia’s governing elite has had five years, since mid-2007, to prepare for ‘fiscal consolidation’.

Meanwhile it has had the luxury of observing, elsewhere, the public response to the austerity programs that have lowered popular living standards across the north-Atlantic countries.

Australian state leaders have had plenty of time, therefore, to plan and enact measures to increase the resilience of existing institutions.

They have known for some time, and Garnaut merely reminds them, that in coming years the entire social order will be placed under strain. Political stability will be threatened amid growing inequality and mass despondency induced by the denial of life chances.

In May 2010, the historian Simon Schama warned in the Financial Times that ‘in Europe and America there is a distinct possibility of a long hot summer of social umbrage. Historians will tell you there is often a time-lag between the onset of economic disaster and the accumulation of social fury.’ A ‘dangerously alienated public’ was being forced to ‘take stock of the brutal interruption of their rising expectations’. A ‘raw sense of victimisation’ hung in the air like sulphur: ‘we face a tinderbox moment’, Schama told the readers of the FT.

Citing 1789 as an example of where events could lead, he advised ‘our own plutocrats’ to ‘channel mass unhappiness’ into safe directions, before ‘fearful disorientation’ turned into the ‘organised mobilisation of outrage’.

I’ll come eventually to some of the safe channels, useful diversions and political blind-alleys into which the Australian state leadership and propertied classes will seek to shepherd people over the coming years, in order to ‘contain calamity’.

But, firstly, strategic planning has also proceeded along other fronts.

Over the past three decades, Australia’s domestic state has been reconfigured into a tool that can more readily impose unpopular measures (as unelected ‘technocratic’ administrations have recently done, on behalf of creditors, in Italy and Greece).

While many other federal and state government organs have atrophied, Treasury and Finance departments, along with the central bank and associated agencies (APRA, ASIC and the Productivity Commission), have been enlarged and empowered. Initiation and veto powers over government policy rests entirely with these finance-linked bodies, plus with the departments overseen by the prime minister and attorney general.

More generally the executive branch of the state (especially senior Cabinet and the administrative apex of the public bureaucracy) has been strengthened. Old restrictions on its power, held by the other (legislative and judicial) governmental arms, have been removed.

In particular, the counter-terrorism measures of the past decade have allowed a hypertrophic growth in the personnel, resources and repressive powers available to the security, intelligence and police agencies. (Or, as the government’s 2011 review of the Australian intelligence community put it, an ‘important adjustment’ has been made to the ‘balance we have struck as a nation between individual rights and the security of our community.’)

Legal instruments like ‘control orders’ and ‘preventive detention’ have been created, while other entities have been given the power to compel evidence from witnesses.

On several matters of great importance, a few cabinet ministers and high-level civil servants, located mostly in the four or five federal departments and agencies listed above, have acquired freedom from substantive or procedural restrictions on their exercise of authority.

A very small number of individuals has been granted personal control, free of former limits or serious oversight, over matters like the domestic call-out of the armed forces, the detention of individuals and the proscription of entire organizations.

Last year Australian Federal Police Commissioner Tony Negus confided to ABC radio that AFP officers were liaising with London police, to examine the latter’s response to urban riots that had taken place there.

The AFP was preparing for the possibility of local outbreaks:

There are a range of different communities who are feeling um, somewhat left out  and this is a very broad question for government in many ways, and the social issues attached to this, education issues and welfare and a range of other things…

I wouldn’t want to profile particular groups but there are young people in this country who are feeling disassociated with what’s happening in a broader sense. And I think that we saw some of that with the Cronulla riots many years ago where people have come together, and we’ve seen just recently in London with the riots over there.

I think we’ve all got to be very careful and examine very carefully as a society what that means for Australia, and what we can do to prevent such actions happening here. ..

I’ve spoken to the Prime Minister personally about this. It’s something she has a great interest in and we’ll be doing our best to contribute to that whole of Government response to make sure that we’re appropriately ready here in Australia to prevent these things

The hysterically intolerant reaction from ruling circles to an innocuous recent political demonstration in Sydney gives a clue as to how any serious expression of dissent or unrest, should it arise in future, will be met. (Ardent support for repression is guaranteed from liberal quarters. ABC television presenter Leigh Sales preposterously introduced a recent report on the Sydney demonstration: ‘Everybody’s still talking about the violent and unpredictable Muslim uprising that took place in Sydney on the weekend. Police are starting to piece together who was responsible and they’ve found some alarming links to Islamic extremism’).

In September 2011, ASIO Director-General David Irvine told the Safeguarding Australia conference how ‘change in some of the most important drivers of our security posture is going to require us to recalibrate and reprioritize’:

We can all see change and fluidity in world events that matter to our security swirling around us… changes in the fortunes of war in Afghanistan and ongoing unrest in Iraq… groundswells of change in the ‘Arab Spring’… widespread unrest in Syria, Yemen and some Gulf states… the ousting of regimes in Tunisia Libya, Egypt, bringing with it all the uncertainty of the ‘new’… Economic shocks closer to home … unprecedented riots and lawlessness in the UK.

So state power has become increasingly concentrated at its executive pinnacle. This new political setup also corresponds, independently of intention or design, to the existing narrow allocation of wealth and social power, which it exists to protect, and which nowadays accrues to a tiny financial aristocracy.

But too great a compression of political and social power may limit the stability of status-quo institutions.

If Australia is about to have, as Ross Garnaut warns, a decade like the 1930s (replete, so he says, with spending cuts like the Premiers’ Plan!), then preservation of the existing order will demand assistance from sources outside the propertied classes and the state leadership.

Creating what members of the policy elite call ‘consensus on the need for reform’ requires the active participation, connivance and unwitting support of various other social fractions.

Treasury Secretary Martin Parkinson has suggested that the policy elite must draw lessons from the 1980s, when ‘a general agreement had formed among academics, policymakers and commentators’ on ‘the need for reform.’ The ‘government of the day then identified, prioritised and built community support for particular initiatives’.

Similarly Garnaut, for his part, mentioned in his recent interview with the Financial Review how under the Hawke-Keating Labor governments a ‘long period’ of ‘public fiscal restraint and incomes [i.e. wage and salary] restraint’ was made ‘politically possible’. This political feasibility derived, he said, from the willing participation of various ‘sectional interests’ in a common project.

Who were these ‘sectional interests’ that provided ‘community support’, and what did the latter consist of?

During the 1980s Garnaut was a senior economic advisor to Hawke. What he and Parkinson now laud about this period, and present as an exemplary model for the present day, involved (as I’ve written several times recently) the fulsome participation of the trade-union leadership, including key Stalinists, in a deliberate elite project (the Prices and Incomes Accord) to reduce the wages, job security and working conditions of Australian employees.

Three decades later, union officials still play the same parasitic foreman or overseer role. They suppress the political activity of employees and help to control the production process on behalf of owners.

Yet their part has waned somewhat following changes during the intervening years: the recomposition of Australian industry and the workforce (especially the reduction in heavy industry and manufacturing, and the rise of casual and intermittent work), the changed place of ‘corporatist’ institutions in negotiations over wages and conditions, the enhanced level of direct monitoring and supervision of workers allowed by new technology, the steep reduction in trade-union membership, and the acquisition by top union officials of social privileges that make plain the incentives governing their backroom efforts ‘on behalf’ of employees.

This removal of the social-democratic safety valve has increased the importance, for the pursuit of elite aims, of various other political diversions, theoretical casuistries and intellectual blind channels. These are presented to the working population by avowedly critical, ‘progressive’, left-wing, ‘radical’ and even ‘socialist’ groups and perspectives.

Some of the latter will, over the coming years, amid an ‘accumulation of social fury’, help to harmlessly usher any popular ‘sense of grievance’ into Schama’s ‘safe channels’, preserving the existing distribution of property rights.

First of all is the familiar, time-honoured presentation of Labor (and its partners among the Australian Greens) as the ‘lesser evil’ to an Abbott-led Coalition. Once in power, it is said, the latter will inflict truly swingeing cuts, courtesy of a ‘budget razor gang’ (for whom state conservative governments have provided a ‘dress rehearsal’). To prevent this, the only prudent course of action available to a ‘progressive’ person is electoral support (holding one’s nose, if one must) for Labor or the Greens.

This cynical position is regularly coupled with the suggestion that austerity measures are imposed only because the ruling elite (or a portion of it) is in the grip of a misguided ideology. Rather than knowing their own interests and ruthlessly pursuing them, state managers and the propertied classes are said, on this argument, not to know what’s good for them. They are indulging, in fact, a bizarre ideological whim or fashion (‘neoliberalism’, etc.) from which they may conceivably be freed.

This conception is, in turn, related to an ‘activist’ brand of politics. An extra-parliamentary protest milieu has existed since the 1970s (when e.g. The Wilderness Society, Australian Conservation Foundation and Nuclear Disarmament Party were born). During this time it has served a useful purpose for the ruling elite, absorbing discontent and trafficking in various political illusions.

In these circles, the ALP and trade-union leaders are considered susceptible to being ‘pushed leftward’ by protest, suasion, cajoling, appeals to their reason or better nature, importuning, threats, urging, petitioning, etc. The ascent of a new ALP government or leader, the occurrence of an election, or the holding of a party or union conference, is inevitably presented by these groups as an ‘opportunity’ for activists to apply ‘pressure’ from below for better and more progressive policies.

Thus, even while the senior state officials of Australia (and the US, France, Italy, UK, Spain, Ireland, Greece, Portugal, etc.) insist in unison that existing living standards cannot be maintained, these activist groups imply that salvation may yet be won under the prevailing order. This licenses ‘left-wing’ political strategies based on that goal. Their upshot is to prevent any kind of ultimate break with the parliamentary system or independence from the political agents of capitalism.

These views thrive amongst well-meaning but politically confused and uneducated people, such as those students who make up the recruiting pool for various campus ‘radical activist’ groups.

But the persistence of these political illusions isn’t explained by the ignorance and gullibility of young people. There are social layers whose entire existence depends on such illusions enduring, and on the resulting perpetuation of existing institutions.

The role of full-time union officials, for example, has already been described. But we must look more widely.

Among these circles also dwell the practitioners of identity politics.

The most blatantly ambitious branch of this species is devoted to the particularist pursuit of careerist benefits for individuals on the basis of gender or ethnic identity. (The spoils may include a larger share of public-service jobs, parliamentary seats, procurement contracts, cheap loans, entry to university courses leading to professional accreditation as lawyers, doctors, etc.)

This lucrative arm of the business calls forth, and cross-subsidizes, its own pressure-group penumbra of lobbyists, journalists, ‘radical’ activists, etc.

The latter encourage or participate in protest politics, as described above. In this they insist on the political exclusivity of the oppressed group in question, which is held to possess its own specific goals  derived from the supposedly unique and shared interests of members  pursuit of which requires independence of ‘movement’ or organization. The fundamental interests of group members (e.g. women, young people, Dalits, ‘yellow people’ or Indigenous people) are held to conflict, in one way or another, with the interests of non-members of the category (e.g. men, old people, non-Indigenous people, etc.). The common interest of all group members, so it is said, is best served by supporting the advancement of suitable group representatives. Once in a position of authority or wealth, the latter will bestow favours that benefit the entire group.

In present Australian conditions, identity politics assumes an especially crucial role.

Of the meagre public goodwill that exists for Julia Gillard’s Labor minority government, a large share is accounted for by appeals to professional feminism. A recent opinion column published in Fairfax newspapers, written by a national coordinator of EMILY’s List, shows the depths of toadying, deceit and self-abasement to which members of this milieu must descend.

This type of article will be familiar to US readers of The Nation. The likes of Katrina vanden Heuvel and Katha Pollitt can always be relied upon to concoct a pressing need for women to support the current Democrat candidate.

Political leaders, in Australia and globally, are announcing themselves ever more brazenly as the servants of banks, creditors and the asset-owning classes. This service will now come, they declare, at the cost of the living standards of employees, their dependants and the broad population.

In pursuit of this project, the propertied classes form as ever a natural constituency. The massed machinery of state repression stands by, ready for use if a ‘dangerously alienated public’ threatens to turn the world upside down. For the moment, various symptoms of political ignorance and disorientation lead restless elements among the propertyless class into traps, diversions and crippling delusions. Meanwhile, in these circumstances, from outside elite layers, practical support for the prevailing order must increasingly depend on the adherence of political constituencies mobilized via flimsy ‘identity-based’ campaigns.

Preparing for austerity in Australia

October 5, 2012

Last Tuesday’s Australian Financial Review carried an interview with economist Ross Garnaut.

In it, Garnaut gave just the latest of many public warnings from a senior Australian bureaucrat or policy advisor to expect ‘faltering incomes and living standards in Australia.’ There would be, he said, ‘restraint in government spending and wages growth for the rest of the decade’.

Two weeks ago, at a Canberra conference organized jointly by the Treasury Department, Reserve Bank and IMF, Garnaut discussed the consequences of slowing private investment, limited employment growth and lower government revenue.

He told his audience to ‘brace’ for a ‘difficult time adapting to a decline in living standards that’s going to be a necessary part of the adjustment’.

These remarks, like the others that have preceded them in recent months, have been reported exclusively by the business press. Though the media interventions are made publicly, outside the walls of any closed institution, they are not addressed widely to a mass audience.

Instead, publication of Garnaut’s comments, and of many others from figures like him, is narrowly aimed at:

  1. The governing elite, which is enjoined to exercise the ‘strong leadership’ required to impose such unpopular deflationary measures, while maintaining social stability; and
  2. Those forming the ‘General Staff’ of public opinion (‘responsible’ journalists, ‘sound’ academics, policy intellectuals, business-linked thinktanks and other influential groups), whose task is to prepare the population to ‘adopt the necessary attitudes for real reform and shared sacrifice’.

Tuesday’s Financial Review quoted Garnaut:

“We have to go through a long period of expenditure restraint” that could last “half a dozen years or more”, he said, referring to future government spending.

“The only comparable period would be from 1984 through to the rest of the ’80s.”

Convincing all Australians and sectoral interests of the need to build “a mood for shared sacrifice” was difficult without strong political leadership.

He compared the current challenges to those faced by Australia during the Great Depression, which resulted in the 1931 “Premier’s Plan” that included large cuts in government spending.

“There have been a number of periods of Australian history where we’ve entered circumstances like we are entering now and haven’t dealt with them. Which means we’ve had long periods of bumping along the bottom: you can include the whole of the 1920s and 1970s.”

“We bumped along the bottom, right through the ’70s and early ’80s until 1983 and we came out of it through a long period of restraint; public fiscal restraint and incomes restraint, again around a context of shared sacrifice.

“It was only politically possible because of that sacrifice.”

Throughout 2012, Treasury Secretary Martin Parkinson has repeatedly warned of ‘deep cuts’ to come in public spending.

He has appealed for ‘a sensible discussion on what we expect governments to provide… much of the debate over government provision assumes we can have it all’. He has noted, in this context, the increased ‘community demand for the government provision of what economists call “superior goods”, including aged care, health, disability, education and social welfare.’

Parkinson warned that ‘building pressures across a range of related fronts – health, aged care, disability’, would threaten ‘sustained growth in living standards, and it will also exert substantial pressure on fiscal sustainability.’

The Treasury secretary has therefore urged the beginning of a ‘national conversation’. As well as ‘significant savings’ on the expenditure side, ‘thoughtful decisions’ must be made about the sources of government revenue.

Specifically the tax base will have to shift away from capital income towards other sources like consumption spending.

The Henry tax review had advised that such an adjustment would be needed to ‘underpin growth’:

With continuing globalisation, tax settings will be of increasing importance for decisions about where capital will be invested, especially for small open economies like Australia. Many countries are reducing tax rates on business and capital income relative to labour income and consumption.

Hitherto, according to this Treasury version of reality, profligacy and indulgence have reigned. Now, though, accounts must be settled.

The only remedy for past exorbitance is for one or more unlucky generations to reduce their consumption in order to pay the bill.

Both the substance and rhetorical mode here may be compared to that of George W. Bush in his presidential State of the Union addresses.

In 2006:

We must… confront the larger challenge of mandatory spending, or entitlements… It is a national challenge. The retirement of the baby boom generation will put unprecedented strains on the federal government. By 2030, spending for Social Security, Medicare and Medicaid alone will be almost 60 percent of the entire federal budget. And that will present future Congresses with impossible choices: staggering tax increases, immense deficits or deep cuts in every category of spending.

And 2005:

Social Security was a great moral success of the 20th century, and we must honor its great purposes in this new century. The system, however, on its current path, is headed toward bankruptcy. And so we must join together to strengthen and save Social Security… By the year 2042, the entire system would be exhausted and bankrupt. If steps are not taken to avert that outcome, the only solutions would be drastically higher taxes, massive new borrowing, or sudden and severe cuts in Social Security benefits or other government programs… I know that none of these reforms would be easy. But we have to move ahead with courage and honesty, because our children’s retirement security is more important than partisan politics.

(Of course Australia had, under Hawke and Keating, already taken the path of privatizing retirement provision – a prospect that Bush’s favourite Marty Feldstein called the ‘$10 trillion opportunity.’)

Parkinson’s statements may also be compared to Mitt Romney’s recent remarks, addressed to a private audience but secretly recorded and publicized. Romney pointed dismissively to that large proportion of the US population ‘who believe that they are victims, who believe that government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you name it. That that’s an entitlement. And the government should give it to them.’

Similarly Garnaut, interviewed on ABC television this week, noted that ‘elements in the community [who] are recipients of tax cuts, of government expenditure, have come to expect a continuation of what could be delivered in the short term in the salad days.’

But the salad days, he said, were now over.

Garnaut, Parkinson, Romney (and Barack Obama) thus declare in concert, and in the name of ‘expenditure restraint’, that ordinary people are not entitled to ‘have it all’.

Public provision to citizens of non-market welfare services and social programs must be reduced and, where possible, eliminated entirely. So-called unfunded liabilities in the form of retirement provision and disability insurance must be repudiated. All this, alas, will lead predictably to a durable fall in living standards for most of the population.

Though elected officials are reluctant to express it so candidly, the entire parliamentary spectrum (in Australia, the United States and elsewhere), regardless of political party, has shown its willingness to impose these policies.

The agenda is shared across the world’s developed economies, and is pursued in nonpartisan fashion by the entire state leadership (high-level civil servants and elected politicians) of each country.

This fact owes little to ideological orientation. It follows ultimately from the obligation of state leaders to act on behalf of the propertied classes, whether or not they consciously identify with the latter’s needs.

A ‘conversation’ on these matters, having hitherto been restricted to a semi-exclusive elite audience, is about to be unleashed publicly on an unsuspecting Australian population.

As it has elsewhere, a phoney media campaign will ensue. ‘Serious’ commentators will insist that elected politicians put aside their narrow party interests and personal ambitions, and work together for the good of the nation. (The US ‘debt ceiling’ charade provides the template here.)

The general population, ill-equipped to resist, will be urged to ‘adopt the necessary attitudes for real reform and shared sacrifice.’

And, as I’ll show in the next post, many apparently ‘critical’ individuals and groups, even ‘radical’ ones, will play a useful part in all this. Even as senior state officials declare in unison that existing living standards cannot be maintained, these ‘activist’ circles will imply that salvation may yet be won under the prevailing order. Basing their political strategies on that premise, they will forestall any kind of widespread break with capitalism, the parliamentary state or the status quo.

For the moment, though, what’s the purpose of this broad elite program?

The first aim is to weaken the ‘fallback position’ of employed workers. Reducing (for example) the level of unemployment payments, relative to wages, will raise the relative worth of getting and keeping a job. This will thereby lower the ‘reservation wage’ or minimum salary level that employers find it necessary to offer workers. (Restricting eligibility for disability payments will have the same effect, by expanding the pool of available labour.) And, by increasing the riskiness to employees of shirking or rebellion (raising the ‘threat point’ of job termination), it will motivate more diligent, obedient and intensive work. Productivity and profit income will therefore be higher than otherwise.

Secondly, and more urgently, the aim is to shrink the liabilities entered in the government balance sheet (which had swelled massively from 2007) while preserving the financial assets of the rentier class (banks, financial corporations, mutual and pension funds and wealthy individuals). This means offloading debt (government’s obligations to its creditors) on to the broader population.

The only way for government to start saving, and to become a surplus sector in a country running an external deficit with the rest of the world (like Australia, Britain, southern Europe or the US), is for the thrifty to save less and start borrowing. If the government wishes to save more than it spends, then as a matter of accounting the domestic private-sector financial balance must become negative. Since investment spending by business is currently limited and borrowing has become difficult, this means the household sector must become more heavily indebted. As employees are terminated and lose their income streams, they will cease to make superannuation contributions and will be forced to run down their savings.

An inherited burden: ex-Stalinists, ‘progressive’ historians and Australian nationalism

June 25, 2012

The Australian historian Ann Curthoys has often spoken of her time in the Eureka Youth League, Sydney University Labor Club, Vietnam Action Campaign, Student Action for Aborigines and Women’s Liberation.

This impeccably Stalinist upbringing acquainted her with fellow CPA scions like Brian Aarons and Patricia Healy, left-wing activists like Bob Gould and the Percy brothers, as well as future establishment figures like Jim Spigelman and Charles Perkins.

Curthoys later described these years as ‘a middle-class baby-boom generation experience, not uncommon, but not typical either.’ She drifted into the New Left around the time the CPA, under the leadership of Laurie Aarons, turned Eurocommunist.

Meanwhile her parents were among those hardcore Moscow loyalists who split to form the Socialist Party of Australia.

In 1990 Barbara Curthoys was granted access to the Comintern archive in Moscow; she later published an article describing how the parents of historian Lyndall Ryan were expelled as right deviationists from the CPA in 1929.

Strangely enough, during the early 1970s Ann Curthoys shared a Sydney residence with Lyndall Ryan while each undertook postgraduate studies at Macquarie University.

They helped to co-found the Women’s Liberation periodicals MeJane and Refractory Girl. Joyce Stevens, a prominent member of the CPA until its 1991 dissolution, also sat on the editorial collective of MeJane.

By 1988, having re-examined the ‘shibboleths of the left’ in an academic discussion group, Curthoys declared herself persuaded by Alec Nove’s vision of market socialism. The future, she now believed, lay with ‘competition and markets.’

Curthoys is one of many Stalinist and ex-socialist academics who played a part, now largely forgotten, in the Hawke and Keating ALP governments’ institutional and ideological renovation of Australian society.

She wasn’t a fulsome and direct participant, as were others like Stuart Macintyre. But, as I’ll explain, her scholarly contributions to the field of labour history  most importantly her work with Andrew Markus on working-class racism and anti-immigrant movements during the nineteenth century  did provide useful ideological tools for that elite policy program.

The latter was presented to the population as ‘a root-and-branch re-examination of many long-standing features of our national life’, ‘dismantling some of our most cherished orthodoxies… deeply embedded in the very psyche of the nation.’ The state leadership openly sought to conscript historians to its project, which it described as a ‘process of deepening our sense of national identity, national responsibility and national maturity. We have altered the focus on our past. With that new focus on the past, has come a reassessment of the past’ (Hawke).

This modification to official nationalism had mundane objectives.

First there was the ‘competitiveness agenda’, which, on the pretext of repairing the current-account balance, took an axe to real wages, working conditions and the social position of employees (while a ‘war on inflation’ subordinated asset-poor borrowers to wealthy creditors).

Then there was the ‘process of national reinvigoration and reinvention’ (Keating) demanded by Canberra’s regional policy. The latter, pursued through ‘multilateral’ forums, in fact aimed to prevent the economic and political integration of East and Southeast Asia independently of Washington’s hub-and-spokes framework of military and diplomatic alliances. The growth of external investment by Japanese firms, alongside the re-entry of China to the world market and the industrial development of various SE Asian countries, raised the possibility that a regional bloc could be formed which could conceivably produce a military-political competitor to Washington  thus threatening the position of Canberra and of Australian-owned firms in the region. Hawke linked so-called ‘regional engagement’ to ‘changes which have occurred in our attitudes to our history, our culture, and our relations with the rest of the world, especially with the peoples of our own region… [which] may be said to have begun with the fall of Singapore in 1942.’

Finally there was the attempt to channel the frustration and disappointment of Aboriginal and Torres Strait Islander people into a political response based on ethnic identity, by granting administrative powers, limited property rights and other privileges to an Indigenous elite. This project involved bringing Indigenous people into ‘the Australian legend’ (Keating).

The old labour radical nationalism (associated with one-time CPA members and historians Russel Ward, Robin Gollan, Ian Turner and Eric Fry) was inadequate to this new age.

In the hands of Curthoys and others, this old labour history, and the nationalism it supported, received a postmodern makeover.

The superseded account, Curthoys explained, ‘has suffered many theoretical blows, has met with other desires, multicultural, postcolonial, feminist. It has been seen as inappropriate to postwar, culturally diverse, urban Australia, expressing the aspirations of a British Australia that no longer exists.’ The retrofitted model would be attentive, in the words of Curthoys and John Docker, to ‘heterogeneity, difference, contradictoriness, and indeterminacy’.

Journals like Labour History therefore applied new methodological and interpretive strictures to contributions. Property relations should be denied any categorical primacy or priority in historical explanation. Social class would instead hold the same conceptual status as various ascriptive traits (e.g. race, gender, ethnicity, generational cohort and religion). Class, like these personal attributes, would be seen primarily as a badge of identity or a label of group membership.

This involved various lamentable concessions to intellectual fashion, as can be seen from the following embarrassing passage. It is by Curthoys, from a 1991 article in the journal Hecate, in which she described the treatment by historians of sex, ethnicity and class:

Many have noticed the similarity of chaos theory to poststructuralist theory in the humanities, in the questioning of older theories of order… [The] similarity between chaos theory in the sciences and recent theory in the humanities is intriguing… Having read my way through [a book by the journalist James Gleick] and learnt something about fractals and strange attractors and bifurcations and iteration and nonlinear equations and the like, I started to think about possible specific connections between feminism and chaos theory… Feminist theory has long had its own “three body problem.” Our three bodies are the concepts of sex (or gender), ethnicity (or race), and class.

In the midst of Australia’s so-called History Wars, Curthoys spoke of the need to ‘develop the kind of pluralist inclusive account of the past that might form the basis for a coherent national community.’

This might have been said by Hawke or Keating, or by Manning Clark, Brian Fitzpatrick, Stuart Macintyre or Don Watson. Indeed, her stated objective was shared by all those ‘left’ historians who, during the 1980s and 1990s, combined their avowedly progressive politics with a taste for sitting on committees and advisory panels appointed by ALP governments, tasked with investigating civics education or a ‘re-founded’ national identity.

For Curthoys, the purpose of the historian’s craft was still to support nationalism, now re-cast in the language of identity politics:

At the forefront, then, of the construction of national identity in the Australian context  as, perhaps, everywhere else  is the question of history. As a cultural practice, history is tied to questions of belonging, kinship, betrayal, inheritance, attachment, fear, and danger. Representations of history are, we know, constructions of social identity…

The insight that all social groups, whether defined by gender, ethnicity, nationality, or politics, construct an account of the past that works to authorise their identity as a group is as relevant and lively in Australia as elsewhere.

It seems likely that such views were prepared by Curthoys’s political upbringing. As part of her youthful education, she would have been exposed to Austro-Marxist theories on the ‘national question’ (the nation as Schicksalgemeinschaft), as well as those proffered by her own party, and subsequently to those varieties of Third-Worldism prevalent in her later radical milieu.

It’s not generally appreciated by people unfamiliar with the Marxist tradition how many of the issues and topics that preoccupied late-twentieth century thinkers (e.g. national identity, unity and diversity within a mass movement, etc.) were originally debated, usually with far greater depth and seriousness, during the first quarter of the twentieth century, by adherents, interlocutors and opponents of classical Marxism. The idea of the nation as a ‘narrative’ that ‘works to authorise their identity as a group’  favoured by post-structuralists, post-colonial theorists and ethno-symbolists, as well as by people like Benedict Anderson and the New Left Review crowd  emerged from this background and contained unmistakeable echoes of it.

The path from Stalinist nationalism to postmodernist nationalism is short, a fact which must be recalled when considering the intellectual origins and political implications of Curthoys’s ‘pluralist inclusive account of the past that might form the basis for a coherent national community.’

What then was Curthoys’s contribution to this new liberal-progressive Australian nationalism?

Much of her early scholarly research concerned labour history, and examined the place within it of racism, sexism and colonialism. In her doctoral thesis, Curthoys had discussed the 1861 anti-Chinese riots on the New South Wales goldfields at Lambing Flat.

Thirty years later she returned to the historical episode, linking it to contemporary issues under the Howard government:

Our treatment of these Chinese men shames many of us… As a nation, our fears and our hatreds, and our interest in the exotic and the Other, live with us still. In imagining those who observed, met, liked, hated, loved and traded with those Chinese gold seekers we see, ultimately, ourselves as we were and in some respects continue to be.

Here was the ideological raw material of nationalism: a supra-individual personality (‘the nation’), a grammatical person that possessed beliefs and attitudes (‘our fears and our hatreds’), stable traits giving rise to repeated behaviours, a ‘national character’ to which events more than a century apart could be attributed.

This was not an idiosyncratic treatment. The nation as collective actor was similarly invoked at this time by Sir William Deane and by Paul Keating.

More specifically, throughout her scholarly career Curthoys returned, again and again, to an idea: the notion that, for two centuries, the male, non-Indigenous Australian working class had benefited from racism, colonialism and sexism, at the expense of women, Aboriginal and Torres Strait Islander people, and immigrants.

Through her work, readers and students of Australian history were taught a curious lesson: they were encouraged, correctly, to consider instances of racism (both in episodes of anti-immigrant chauvinism, and in the exterminist logic of settler colonialism) as obviously wicked and repugnant (at least from a contemporary standpoint). Yet with this negative evaluation was packaged the factual claim that racism had had beneficial consequences for the majority, or at least a large minority, of Australians.

In a 1978 article in Labour History (later published in a very influential book on the history of Australian working-class racism, which she co-edited with Andrew Markus) Curthoys wrote that the ‘super-exploitation’ of Aborigines, Melanesians and women in late nineteenth-century pastoral, sugar, clothing and food-processing industries ‘may have enhanced the wage rates of the greater part of the workforce, the male European workers’:

The relative roles of capital and labour in the emergence of a movement against Chinese immigration are [therefore] somewhat clearer. Organised labour’s position as the defender of jobs and wages meant that it was the logical leader of opposition to the Chinese as economic competitors with European workers. In so far as the anti-Chinese movement went beyond the specific cheap labour issue into the realm of social, political, moral, race-purity, and general economic complaints against the Chinese themselves, labour’s leadership was augmented by small employer, self employed, and general middle class concern. For their part, the larger representatives of capital were at this stage anti-Chinese in the sense of supporting their super-exploitation, but not in the sense of wishing to exclude them from the colony.

Markus added that ‘for the labour movement the campaign against non-European immigration was part of a broader battle to maintain established standards by restricting access to the labour market.’

On this account, popular racism and exclusivism were not tragic errors that divided Australian workers from their class allies, thus playing into the hands of the propertied elite. Instead (according to Curthoys and Markus) they had followed rationally from the material interests of Australian employees.

Curthoys and Markus’s interpretation of events rested upon the assumption that Labor parliamentarians and union officials reliably represented the views and well-being of their constituents, rather than having encouraged parochialism and nurtured atavism out of their own self-interest. As one historian has recently pointed out, ‘no evidence is provided to justify this assertion.’

In its absence, readers were left with Curthoys’s claim that employees were the ‘logical leader of opposition to the Chinese’ since racism ‘enhanced the wage rates of the greater part of the workforce.’

But she likewise offered no empirical or theoretical support for this claim, merely pointing readers to the work on segmented labour markets by Berkeley economist Michael Reich. (In reality, she was relying upon the influential theory of discrimination offered by the Chicago economist Gary Becker, for whom employees find it in their interests to support racist prejudice, while profit-maximizing firms cannot do so, since otherwise they will be driven out of business by low-cost competitors. Reich, on the other hand, had just published a paper called ‘Who Benefits from Racism?’ which reached the opposite conclusion: ‘Capitalists gain and white workers lose.’ He had written as much several years earlier: ‘the economic consequences of racism are not only lower incomes for blacks but also higher incomes for the capitalist class and lower incomes for white workers… where racism is greater, income inequality among whites is also greater… [Racism] is in the economic interests of capitalists and other rich whites and against the economic interests of poor whites and white workers’.)

Many decades later, Curthoys’s ideas about who benefits from imperialism and racism continue to inform her historical work and her recently expressed political attitudes.

They account for her repeated claim (which I mentioned in a post some time ago)  that all ‘non-Indigenous Australians’ are ‘the beneficiaries of the colonisation process’ which devastated Aboriginal and Torres Strait Islander societies.

[All] migrants and their descendants, including those of non-Anglo-Celtic background, [have come] to be recognised as colonisers, as part of and benefiting from colonisation with its history of indigenous dispossession.

These ideas are favoured and expressed most relentlessly by members of a particular milieu: those, like Curthoys, with a tribal affiliation to the ALP, the children of union officials and public servants, Stalinists and social democrats.

Their eagerness to implicate others as the beneficiaries of imperialism perhaps stems from a guilty awareness (recalled dimly from childhood catechisms) that the privileges have accrued, in fact, to people like themselves.

In the political education of her youth, Curthoys would have encountered the idea of the ‘labour aristocracy’, a Marxist term applied to the privileged layer of union bureaucrats and labour party officials. In Lenin’s canonical account, the income, social influence and living standards of this stratum were supported by ‘morsels of the loot’ extracted from the direct producers, particularly the super-exploited toilers in colonies and other low-wage countries. Material self-interest then gave rise to this group’s reformist and conservative political outlook, which (thanks to their degree of social influence) contributed to maintaining the prevailing order. Above all this meant their encouragement of racism, xenophobia and allegiance to the flag. The social-democratic leaders of the Second International stood as object lesson and exemplar of this type. The nationalism of the Stalinist parties provided a sad historical echo.

This ideology (i.e. the one expressed in the above image, that all Australians without Aboriginal or Torres Strait Islander ancestry are ‘beneficiaries of the colonisation process’) has been promoted by the state elite (most emblematically in Keating’s Redfern speech and in Sorry Day, and in literature and film).

It has become a core proposition of one contending strand in Australian historical thinking: the ‘progressive’ left-liberal version.

The latter is one of the acceptable interpretive options, presented to tyro students and readers on big historical questions, and from which set of alternatives they are invited to choose (the options are exhaustive) based on ideological inclination. It’s the version favoured in bien-pensant organs of opinion, spanning from the ABC and ALP-aligned thinktanks to the ‘radical’ left, and adhered to by all avowedly ‘progressive’ people.

Historian Marilyn Lake, with whom Curthoys recently edited a book on ‘transnational history‘, expressed something like the above notion when describing the formation of Australian ‘national identity’:

Aboriginal people were active in identifying all settlers – whether hut-keepers, clergymen, convicts or military officers – as one people, as ‘white men’, whom they held jointly responsible for taking their land… [The indiscriminate nature of] Aboriginal retaliation and revenge… is explained by the Aboriginal perception that a group of people defined by their ‘whiteness’ had taken their country.

Curthoys’s claim that ‘all migrants and their descendants’ have ‘benefited from colonisation’ serves an obvious social function. It implies that Australian history has been, and contemporary society remains, a zero-sum conflict between various ethnic groups. The fortunes of every member of one group (Indigenous Australians) have varied inversely with the welfare of every member of all other ethnic groups (non-Indigenous Australians): the two parties have contended over relative shares of some fixed pie, with the fruits shared out according to ethnic distinctions rather than any other relevant social category.

The political implication of this argument is dire and reactionary: if A benefits by inflicting some loss on B, then B can only gain or recover the loss at A’s expense, in which case A isn’t a credible ally for any project by B to advance its material interests, for in doing so A would be harming itself. B can only satisfy its wants by breaking with A. In other words, there is no basis for common cause between Aboriginal or Torres Strait Islander people and any other Australian people.

The spread of such beliefs upholds the political exclusivity of groups defined along ethnic (or linguistic, religious etc.) lines, and partitions members of populations who otherwise might act in political concert. Such nationalist thinking channels the frustrations of oppressed groups into political solutions based on ethnic distinctions, a pursuit which benefits only a rent-seeking elite of ‘minority representatives.‘ It justified the CPA’s advice to the Gurindji cattle workers and members of other Aboriginal groups to seek ‘land rights’, a political decision which served the designs of the Australian state elite.

Curthoys has declared she developed this idea (i.e. that all migrants had benefited from colonialism) from reading feminist writers, as well as from the ‘wages of whiteness’ theory of the US historian David Roediger.

I suspect that during the 1970s she would also have encountered the idea of ‘unequal exchange’ from Arghiri Emmanuel and the Latin American dependency theorists. The latter were popular in the Third-Worldist circles of the New Left, and they purported to describe the relations between imperialist countries and underdeveloped economies.

Emmanuel enlarged the category of ‘labour aristocracy’ to include all waged and salaried employees in the advanced economies, all of whom were now considered to share in the spoils of imperialism (via differences in wages relative to labour productivity). Emmanuel suggested that the ‘chief beneficiaries’ of imperialism ‘since the middle of the nineteenth century’ had been ‘labourers and ordinary skilled workers’.

In an exchange with Charles Bettelheim published in Monthly Review, he mocked the ‘delusions of internationalism’ and socialist hopes for worker solidarity: ‘a majority of mankind is suffering from hunger whereas in certain countries the workers are struggling to acquire washing machines.’

[The] antagonism between rich and poor nations is likely to prevail over that between classes…

It is not the conservatism of the leaders that has held back the revolutionary élan of the masses, as has been believed in the Marxist-Leninist camp; it is the slow but steady growth in awareness by the masses that they belong to privileged exploiting nations that has obliged the leaders of their parties to revise their ideologies so as not to lose their clientele…

Today everything suggests that there is more socialism and internationalism in the brains of the intellectuals of the Labour Party, and perhaps more still in those of some bourgeois liberals, than in the feelings and reactions of the British working class.

Emmanuel thus claimed that the ‘imperialism of trade’ gave rise to a ‘de facto united front of the workers and capitalists of the well-to-do countries, directed against the poor nations’.

This wouldn’t have been too alien to someone, like Curthoys, who received a Stalinist education in the early 1960s. At this time the Soviet leadership claimed that ‘national bourgeoisies’ of newly independent countries (represented by Nasser, Nehru, Nkrumah, etc.) were allies of the propertyless classes in the struggle against imperialism.

Support for such thinking (i.e. the Curthoys-Markus theory of Australian racism, and the Curthoys-Lake theory of colonization) is broad. It attracts adherents despite the unwillingness of people like Curthoys to lend empirical backing or persuasive advocacy to what, as a result, becomes a mere ideological edict. Even allowing for the functional purpose it serves for the ruling elite, part of its success derives from a genuine appeal it holds for a fraction of middle-class opinion. Why?

I’ve said elsewhere that guilt is a positional good. Like private consumption choices and leisure activities, expressed political attitudes sometimes involve the signalling of good taste and discernment. What today passes for ‘progressive’ political activity increasingly involves a person’s public declaration of alignment with a cause, or loud expression of opposition to an entity or person (e.g. Andrew Bolt or Pauline Hanson). This has little to do with political principle. Instead it’s about the signalling of correct thoughts, possession of good taste, and status as a Serious Person. Being ‘right-thinking’ requires a costly investment (i.e. of time and effort to learn the group-appropriate ideas and perform the necessary ablutions). It thus works as a kind of screening device that reveals one’s underlying ‘type’, since only certain kinds of people can afford the investment.

Following the death of social democracy, evident in the decline of trade unions and the ALP as mass-membership organizations, the electoral politics of parties like the ALP and Australian Greens (which both now pursue a kind of social liberalism) are increasingly based around appealing to a narcissistic, educated social stratum (skilled professionals, often self-employed or earning partnership income, with control over productive assets and their own labour process).

The members of this layer habitually see the broader population (mere employees) as racist, less sophisticated, vulnerable to demagogy, etc. In contrast to those whose work involves contracting to provide specific labour services (e.g. lawyers, consultants, tradespeople) employees hired by firms surrender decision-making authority and independent direction over their own work process. Within firms, low-level workers are accustomed to submitting diligently to the orders of managers and supervisors, and responding to external rewards and sanctions rather than (as higher-level functionaries must) internalizing the values of the organization and acting out of personal initiative.

These workplace experiences do have an ongoing effect on individual personality development and attitudes.

Long ago, Adam Smith gave expression to this middle class self-regard, describing the mental atrophy induced by ‘the employment of the far greater part of those who live by labour, that is, of the great body of the people’:

[The] understandings of the greater part of men are necessarily formed by their ordinary employments. The man whose whole life is spent in performing a few simple operations, of which the effects are perhaps always the same, or very nearly the same, has no occasion to exert his understanding or to exercise his invention in finding out expedients for removing difficulties which never occur. He naturally loses, therefore, the habit of such exertion, and generally becomes as stupid and ignorant as it is possible for a human creature to become. The torpor of his mind renders him not only incapable of relishing or bearing a part in any rational conversation, but of conceiving any generous, noble, or tender sentiment, and consequently of forming any just judgment concerning many even of the ordinary duties of private life. Of the great and extensive interests of his country he is altogether incapable of judging…

Many supporters of left-liberal parties accordingly flaunt what they see as their heightened sensitivity (especially their taking on of collective guilt), compared to the boorish masses. It is an article of faith for these people that inter-ethnic hostility arises mostly from competition within the low-skilled, low-wage labour market. (The work of economist David Card suggests otherwise.)

The racist bogan is a fantasized character against which the chattering classes define their own social existence and understand their own political role.

‘Progressive’ left-liberal opinion-makers and figures of cultural authority – in schools, in the mainstream media, etc. – thus insistently tell the population, just as their openly chauvinist and right-wing counterparts do, that internationalism is a ‘delusion’: that anti-immigrant parochialism and race hatred are explained by their rational pursuit of their own interests.

Both versions of ‘legitimate’ opinion promote, delight in and license the spread of racial discord.

‘We are us’: Australian economic nationalism under Hawke and Keating

June 14, 2012

During his time as treasurer and prime minister, Paul Keating, seeking a soothing dietary supplement with which to serve his less palatable economic fare, insisted on the need to forge ‘a new sense of national unity… a common national sentiment… to create a new unity of purpose’.

‘Institutions and symbols’  chiefly the constitution and the national flag  should be adjusted. Doing so would ‘encourage closer identification with the nation’ and create ’a more spirited sense of national goals and purpose.’

In describing the ‘powerful unifying element’ needed to ‘re-cast Australian identity’ and ‘evoke pride in our Australian heritage’, Keating counterposed ‘traditional Labor ideals’  ’egalitarianism’, ‘social justice’, ‘the fair go’  with the ‘forelock-tugging’ of the conservative parties, ‘British to the bootstraps.’

Having flown by troop transporter, accompanied by a military historian, to the Papua New Guinea Highlands, the prime minister, overcome by the solemnity of this ‘sacred ground,’ stooped reverentially to kiss the soil of Canberra’s former colony.

‘[In] accordance with his mission to secure Australia’s interests in the region,’ reflected Keating’s speechwriter, the prime minister was moved to genuflection:

Somewhere on the flight from Moresby to Kokoda, as he talked to David Horner, Keating decided that he should make a gesture which would do justice to these events  an act of some kind which would indelibly mark Kokoda in Australia’s collective memory, as perhaps Gettysburg was marked in the American mind by Lincoln.

Around the prone head of government, a local children’s choir waved flags and chirruped the national anthem of both countries. ‘And no one had a dry eye.’

Keating Kokoda 1992

Such was the electoral formula for the era, adding comforting gestures of civic consensus to more strident policy imperatives.

For Keating and Hawke’s ’new unity of purpose’  in the form of a refounded national ideology  was required to legitimize, distract from and sustain the social and economic changes of the 1980s and 1990s.

The latter involved a crushing re-assertion of the prerogatives of ownership (and the outlook of lenders) over the opposing claims of employees, borrowers and other subordinate classes.

It brought stagnant and declining real wages between 1983 and 1996; sharp redistribution of income in favour of property owners; creation of a vast reserve army of permanent unemployed, elimination of ‘restrictive work practices’, allowing longer hours at higher work intensity, alongside the emergence of sporadic or intermittent short-term employment; lowering of the company tax rate (from 46% in 1983 to 33% in 1996) and flattening of the personal tax scale; privatization of state assets including Qantas, Telecom and public utilities; removal of various banking restrictions; assignment of new decision-making powers over large pools of assets to union bureaucrats and Indigenous ‘representatives’; restrictions on eligibility to previously universal welfare entitlements through means testing; opening of capital markets; designation of price stability as the supreme goal of monetary policy; and rapid destruction of local steel production, car-making, heavy engineering and clothing, textiles and footwear manufacturing, etc.

To accomplish all this, Hawke and Keating  and others manning the levers of mass psychology and attitude manipulation  insistently invoked the first-person plural pronouns  the national ‘we’ and ‘us’  and affirmed the existence of a collective ‘national identity’.

In 1988, Hawke spoke before the National Press Club in Canberra:

As a nation  and as a Government  we have had to make hard choices. And there are hard choices and hard decisions to come. Because of world events, we have had to look very critically at the way ahead – what we are doing as a nation, where we are going as a nation…

The role of the union movement  the willingness of workers to create jobs through sustained wage restraint, an unprecedented attack on outmoded work and management practices, including under the auspices of the current two-tier wages system, and reduced  industrial disputation, has been indispensable…

But the task is far from complete  indeed given our rapidly changing world, and especially the massive changes in prospect among the giants of our region such as China and Japan, that task will never be complete. The reality is that our prosperity will not be handed us on a platter. We will have to match and better the productivity, the product quality, the creativity and the entrepreneurial flair of the world’s best across all sections of the economy, even those not directly engaged in trade.

Thus went the hypnotic mantra, aiming to secure popular adherence to policies (the ALP’s ‘competitiveness agenda’) that imposed hardship on most of the Australian population for the sake of benefits enjoyed by a few.

The false image of a unified domestic entity (‘the nation’), engaged in a shared project in pursuit of ‘our’ common objectives, was presented to obscure the class-specific goals and unequal sectional impacts of those policies.

‘I see policy’, said Keating, ‘as a process of national reinvigoration and reinvention. I see it as a process of national character building.’

He went on helpfully to explain that ‘conflict in the workplace is not a quintessentially Australian way of operating.’

This ideology of economic nationalism (the political base of which was found among trade union officials like Laurie Carmichael) had long been the means by which class objectives, laid out by the policy elite, were repackaged as ‘the national interest’, and through which the state’s pursuit of those objectives secured popular allegiance.

The task of formulating it traditionally fell to ‘radical’ or social-democratic intellectuals and its designated electoral lure was the ALP.

From the mid-1960s, an influx of US, British and Japanese capital, fleeing a global downturn in profitability, had rushed into the local mining industry.

In the early 1970s, state managers sought to create room for struggling Australian-owned firms to switch their capital into this profitable sector. Jack McEwen’s ‘buy back the farm’ slogan was used when the McMahon government imposed restrictions on foreign investment and the Whitlam government required 50% local equity in mining projects.

During this period, left-nationalist economists like Ted Wheelwright and Brian Fitzpatrick, along with various Stalinist groups, especially the CPA (M-L), presented Australia as a ‘dependency’ or ‘client state’ of transnational corporations, a branch office whose ‘comprador’ elite (Kosmas Tsokhas) was controlled from New York, London and Tokyo.

Parochialism of this sort  which described an ‘Australia ripped off’ (Carmichael) by foreign-owned firms  assisted domestically-owned firms like BHP, the ‘Big Australian’, to move into mining.

In 1981 a CSR executive declared to a business paper: ‘We quite cold-bloodedly used the rising Australian economic nationalism and the beginning of the resentment against multinationals.’

The economic nationalism of the 1980s was rather different, though any novelty might have been difficult to perceive at the time.

In 1975 Wheelwright had sat alongside ACTU President Bob Hawke on the Jackson Committee of Inquiry into the Australian manufacturing industry. Several of the guiding principles and policy recommendations developed there would subsequently form part of the ALP-ACTU Prices and Incomes Accord under Hawke’s party leadership. And the weakness of the Australian manufacturing sector, a key complaint during the 1970s from the Stalinist AMWU official Carmichael and the ‘dependency’ economists, would eventually be a key pretext for the ‘reforms’ of the 1980s.

But in other respects the form of nationalism encouraged under Hawke and Keating was something quite new.

Industrial capitalism had always depended on the national state to provide its own conditions of existence: creation of a national workforce through mass education, unification of the domestic market through provision of public goods like transport networks (roads and railways), and through abolition of internal tariffs, enforcement of private-property rights via centralized bureaucratic rule over a contiguous territory and maintenance of a standing army, etc. These also provided the material foundation for nationalist ideology, by which members of a population came to see themselves as members of a single nation with a shared fate, and to believe that their common interests were tied to the economic (and inevitably military) needs of the domestic state.

The particular state-supporting Australian nationalism that emerged full-blown during the 1980s corresponded to the state’s new role, as decreed by elite policymakers: to facilitate the adjustment of private firms to global competition by reducing wage costs and raising the amount of labour effort extracted per given hour of paid work (‘productivity’).

In the 1980s, the national watchword was ‘international competitiveness’: global and regional integration called for ‘Australia’ to accommodate itself to the discipline of the world market.

‘National consensus’, courtesy of ‘a very enlightened central leadership in the union movement’, formed around ‘a principle of keeping wage movements competitive with our trading partners.’

This new imperative emerged slowly following the collapse of the Bretton Woods system in the 1970s, when Australian firms were increasingly able to borrow funds in offshore capital markets.

From the 1980s onwards, compulsory subscription to funded pension schemes (‘defined contribution’ superannuation) channelled local funds into financial markets. The increased liquidity allowed sustained inflation of domestic stock prices. Following the removal of foreign-exchange controls on cross-border capital movements, there then ensued large inflows of portfolio investment, mostly from Britain and the US, in pursuit of the speculative gains promised by these rising asset prices.

These private financial inflows, rather than direct investment and rather than the few instances in which Australian-based firms purchased productive assets abroad or undertook transnational operations, were the means by which Australian capital was ‘globalized’, and through which it became necessary for domestic firms (and a fortiori their employees) to obey ‘international benchmarks’.

The latter requirement, in turn, necessitated a shift in the relative size and role of various departments, branches and agencies of the Australia state.

There was hypertrophy of those governmental arms (Treasury, Finance, the Reserve Bank, etc.) responsible for inflation targeting and wage repression; and a withering of welfare or service agencies, in order to reduce non-wage sources of income and thereby reduce the bargaining power of employees.

As the state acquired a new shape, so did the national ideology by which popular allegiance to the state was secured.

Hawke gave a ‘major statement about what we must do together to meet the economic challenges facing this country’:

Today I want to speak to my fellow Australians, not in the jargon of economists, but in terms we can all understand…

Government has the responsibility to lead the community by getting the right policy framework – we will do that. But it is only with the understanding, the commitment of all Australians – as individuals and through their representative organizations – that our nation will meet the challenges ahead. What are those challenges? The first is for us to realize that this tough, increasingly competitive world of five-and-a-half billion people does not owe, and will not give, seventeen million Australians an easy prosperity. The days of our being able to hitch a ride in a world clamouring, and prepared to pay high prices, for our rural and mineral products, are behind us. From this fact flows everything else.

The challenge for the foreseeable future is to produce more than we spend. The rest of the world will not allow us to continue indefinitely to live beyond our means by borrowing from them. Our rural and mineral products will remain important into the future. But the challenge is to add to them. That is, we must export more manufactured goods and services and substitute more quality Australian production for imports.

Thus ‘adaptation to the changing world economy’ demanded ‘change in our national habits and attitudes and way of thinking about things and our way of doing things.’

This raised what were ‘fundamentally questions of national confidence: could Australia survive, compete and prosper in this rapidly changing world?’

Australia had reached a fork in the road: down one track lay great challenges, coupled with the prospect of renewed vigour in our economy; down the other, an apparently easier ride, but one that would have seen a permanent fall in living standards, not only relative to our traditional standards of comparison in Europe, but relative to our rapidly growing neighbours in Asia.

An ‘Australia with a modern, diversified, competitive and export-oriented economy, an Australia vigorously engaged with the world economy and enmeshed in particular with the dynamism of Asia and the Pacific’ needed ‘the industrial wing of our great [labour] movement’ to bear ‘the pain and the difficulty, to further the fundamental objectives, both of the party and of the nation.’

This required ‘a root-and-branch re-examination of many long-standing features of our national life and of the assumptions underpinning them’. It involved ‘dismantling some of our most cherished orthodoxies… deeply embedded in the very psyche of the nation.’

In particular ‘we confront the prospect of perhaps the greatest changes in our wages system we have seen. The sharply increased emphasis on workplace bargaining against demonstrated productivity benchmarks will fundamentally alter industrial relations in Australia.’ Pleasingly, ‘in reforming awards to make them relevant to contemporary industrial conditions the union movement has been in the vanguard.’

There was also the matter of ‘anachronisms in many areas of public ownership.’

This state-sponsored project of renovating national ideology required that scholarly and published history, too, must adjust (I’ll explore this more in the post to follow this one).

Hawke, who was to that point the most uncompromisingly pro-Zionist and Washington-aligned leader in ALP history, suggested that ‘changes which have occurred in our attitudes to our history, our culture, and our relations with the rest of the world, especially with the peoples of our own region… may be said to have begun with the fall of Singapore in 1942.’

Canberra’s strategic turn from London to Washington had initiated a ‘process of deepening our sense of national identity, national responsibility and national maturity. We have altered the focus on our past. With that new focus on the past, has come a reassessment of the past.’

Hawke made this remark about Singapore in the same year that popular historian David Day published his book The Great Betrayal: Britain, Australia and the Onset of the Pacific War 1939-1942. This commercially successful work, promoted by Keating and inventing a spurious ‘Battle for Australia’, portrayed Menzies as the credulous sycophant to a perfidious Whitehall.

Day’s was the latest in a genre of anti-British pro-Curtin Irish-Catholic republican histories, officially favoured by the ALP ever since Manning Clark described the struggle waged between the ‘old dead tree and the young tree green’.

Established via a concerted elite project, this vision of ‘the nation’ as a collective personality (with its own common destiny, moral qualities, etc.) would form part of the repertoire and lexicon of ‘progressive’ politics in Australia during subsequent decades.

The nationalist ‘we’, apparently delineated on the basis of ethnic ancestry, was the subject of Keating’s celebrated Redfern speech (‘…it was we who did the dispossessing. We took the traditional lands and smashed the traditional way of life. We brought the disasters’). This speech was written by the biographer of Brian Fitzpatrick, the left-nationalist historian.

William Deane, the former High Court justice and Governor General appointed by Keating, declared that the criminal horrors of Australian colonialism were ‘properly to be seen as acts of the nation itself’.

The nation was thus presented as a kind of supra-individual agent, capable of undertaking actions and of possessing beliefs and attitudes.

Predictably, with the onset of a deep and protracted recession in 1990, the elite project to assert Australian national identity assumed a more sinister form.

The government and its media conduits had spent years instructing members of the population that their interests were tied to those of Australia, a collective entity (‘us’) engaged in a competitive struggle with other nations: a game with winners and losers. The frustration and disappointment accumulated throughout those years of reduced life chances – of income, working conditions, job security and basic services sacrificed in the name of the ‘national interest’ – was readily displaced into racist chauvinism and scapegoating.

Were not ‘our’ jobs being taken by ‘them’? Were not outsiders receiving welfare payments to which only insiders were properly entitled? (In the 5 years before the recession, net inward migration had risen sharply, though it had plummeted from 1989 to historically low levels.)

Refugees and various ethnic groups became a useful diversion from the unfolding social misery.

(Keating’s Working Nation policy package, released in 1994 after the number of unemployed people had reached over 1 million, contained various ‘mutual obligation’ and workfare measures that prepared the ground for the Howard government’s work-for-the-dole scheme and privatization of the Commonwealth employment agency. Drafted with the participation of Carmichael, now chair of the Employment and Skills Formation Council, Working Nation‘s Job Compact pushed long-term unemployed people into training programs and subsidized private employment for which they received below-award ‘Training Wages’.)

In 1992, Keating’s Immigration minister Gerry Hand (Hawke’s former minister for Aboriginal Affairs) introduced mandatory incarceration of ‘boat people’.

A former AMWU officer, Labor senator Jim McKiernan, spoke of the country being ‘inundated’: ‘boats filled with people’ would soon ‘land on our shores by the score.’ Said Hand, as he introduced the legislation to Parliament: ‘The Government is conscious of the extraordinary nature of the measures which will be implemented by the amendment aimed at boat people. I believe it is crucial that all persons who come to Australia without prior authorisation not be released into the community.’

The federal government publicized workplace raids and subsequent deportation of ‘illegal immigrants’. Public-opinion survey responses showed a dramatic rise in negative attitudes towards immigration during the early 1990s.

The following years produced the sudden rise to media attention and electoral prominence of a vicious and openly racist brand of nationalism, advanced by Pauline Hanson. She spoke at the launch of her One Nation Party:

We, all of us here tonight, and millions of people across Australia can celebrate, at last there is the chance for change…

The chance to stand against those who have betrayed our country, and would destroy our identity by forcing upon us the cultures of others.

The chance to turn this country around, revitalise our industry, restore our ANZAC spirit and our national pride, and provide employment for all Australians who have given a fair break would seize the opportunity for a better way of life, for themselves, and for their families.

The chance to make sure the Australia we have known, loved and fought to preserve will be inherited intact, by our children, and the generations that follow them.

Ladies and Gentlemen, chances are fleeting, they must be held tightly, and so tonight more than celebration, is a time for resolve, for if we fail, all our fears will be realised, and we will lose our country forever, and be strangers in our own land.

As it stands, the future is one where the majority of Australians will become second class citizens in their own country, under a government who panders to minority interests and denies the majority their right of decision…

We can win, we can make the difference, we can be the best place, but we must learn the lessons of the mistakes made by so many other countries.

We must stop our government repeating these mistakes, before we become like all the other places everyone wants to leave.

We cannot continue pursuing the failures of multiculturalism.

We cannot just give away what we all know to be so valuable.

If you want to live here permanently, you must want to be an Australian.

We must stand together to make these changes, or eventually be dragged down by the conspiracy of divisiveness that has been encouraged by our governments, and let loose upon the people of Australia without their permission.

Australians can no longer afford the luxury of apathy.

We must stand up.

We must all pull together.

We must win this battle, or lose the war.

After the political establishment had made use of Hanson, who provided cover under which ‘moderate’ politics shifted drastically to the right, she was removed from the scene through a legal stitch-up orchestrated by senior government figures.

Her invocation of ethnicity as the basis for ‘national identity’ was described as something sui generis, contrary to all that had gone before it (or, at least, and as she thought, wholly opposed to the nationalism of the recent ALP governments).

But the insipid rhetoric of the above speech plainly borrowed both tone and substance from more exalted, and very proximate, sources.

Hawke, Keating, and the respectable figures of Australia’s ‘progressive’ political elite had spent the previous decade and more drumming into heads the idea of a collective entity called ‘Australia’, and the categorical distinctiveness of ‘Australians’, who were said to be engaged together in a competition with the rest of the world. In this battle (loss of which threatened a ‘permanent fall in living standards’) Australians were said to share a common ‘unity of purpose’.

Whether membership in this national group was defined by ethnic origin or cultural ‘values’ or degree of workplace pliancy (in truth Keating used each of these criteria at various times) was therefore relatively unimportant.

For the deliberate purpose of ‘encouraging a closer identification with the nation’ was to nurture parochialism: to bind the vast majority of the population ideologically to the goals of a ruling elite with which they shared no common cause, and to divide them from the billions throughout the rest of the world, with whom their interests, should they have come to know them, were aligned.

Australian Stalinist academics face the 1980s

June 6, 2012

I recently described how prominent contributors to the CPGB’s Eurocommunist monthly Marxism Today  the cultural theorist Stuart Hall, historian Eric Hobsbawm, and journalists Geoff Mulgan, Charles Leadbeater, Martin Jacques and Beatrix Campbell — helped transform the British Labour Party under Neil Kinnock and laid the foundations for Tony Blair’s New Labour.

Those intellectuals were preoccupied, as Jacques put it recently, with ‘Post-fordism, globalisation, the state, the changing nature of the culture, post-modernism’.

Several of them founded a Third Way think tank and later worked as policy advisors for Downing Street.

The CPA’s Australian Left Review followed a similar trajectory until its end in 1993.

During the 1980s CPA leaders Brian and Eric Aarons sought to preserve their flagging apparatus by appealing to a ‘diversity of radical movements.’

Most ALR contributions thus included admiring references to Gramsci and the ‘post-Marxists’ Laclau and Mouffe.

Images of Madonna dotted the pages in a feeble attempt to mimic the style of Marxism Today. The self-conscious cuteness and sham populism of an article like ‘The Eighteenth Brumaire of Kylie Minogue’ was representative.

The ALR‘s last editor, David Burchell, later became a Third Way cheerleader for Mark Latham.

Sadly, for those interested, little from the ALR has been digitized and made accessible online.

The final issues were mostly given over to questions of ‘cultural policy’. Debate participants included a nest of ‘culture industry’ experts (Graham Turner, Stuart Cunningham, Colin Mercer, Tony Bennett, John Hartley) from Queensland universities.

During the 1980s these academics, several of whom were then CPA members, had (following Stuart Hall) written of a need for the ‘left’ to re-evaluate ‘popular culture’ (i.e. adopt a less critical attitude toward products of the media and entertainment industries).

These figures were now, by the early 1990s, jockeying for Creative Nation funding and consulting work from the Keating government. Accordingly they had discovered that ‘cultural practices’ were ‘intrinsically governmental’ and required the formation of ‘cultural policy’.

Closely related to this group, and in solid agreement with them, were Queensland Foucauldians such as Jeffrey Minson, Gary Wickham, Ian Hunter and Denise Meredyth. They were preoccupied with cultural ‘governance’, and wrote in support of the Dawkins reforms to higher education.

With them stood the British ex-Althusserian, Barry Hindess (who incidentally was last seen here).

Most of the remaining contributions came from cultural studies academics such as Jennifer Craik, Toby Miller, Gay Hawkins and Meaghan Morris (who, inspired by the ALR’s ‘showbiz profile’ of Paul Keating, notoriously described the strange ‘ecstasy’ inspired in her by the appearance of the then-Treasurer).

Of the few recognizably political articles, the tone and substance of the following is representative:

Whether an airline is government-owned or privately owned is never going to be as important to people as whether the planes have a tendency to drop out of the sky. Careful regulation is obviously necessary here. Similarly with water supply – a privatisation campaign of much controversy [sic] in Britain. Who cares whether water authorities are publicly or privately owned? People care much more about the quality of the water provided. Again, careful regulation is obviously necessary… The truth is that debate about good services in most complex societies will very rarely reveal a compelling case either for or against privatisation.

Though most of these intellectuals had once described themselves as Marxists, there now was no residual trace of a political allegiance or theoretical commitment, save the occasional invocation of Gramsci (‘counter-hegemonic’ cultural policy, etc).

The historical significance of these figures, and that of the CPA’s late publications, may therefore seem slight, besides the obvious contribution made by each towards the intellectual and cultural degeneration of Australian society.

But some Stalinist and social-democratic academics did play an influential political role in the institutional and ideological renovation of Australian society undertaken by the Hawke-Keating ALP governments of the 1980s and 1990s. These changes included cuts to real wages, creation of permanent pools of mass unemployment, sharp redistribution of income in favour of property owners, privatization of state assets, assignment of new decision-making powers over large pools of assets to union bureaucrats, and rapid destruction of local steel production, car-making, heavy engineering and clothing, textiles and footwear manufacturing, etc.

Several of these consequences ensued directly from the Prices and Incomes Accord between the ALP and ACTU. So I’m going to briefly describe how some intellectuals contributed towards the forming of that agreement, in its various stages.

The Accord couldn’t have taken place without Stalinist union officials, as Bill Kelty has declared. Today, Julia Gillard’s former membership in the Socialist Forum of Bernie Taft and John Halfpenny is one of the few reminders that such circles ever existed. These people and organizations were effaced in part by the results of their own deeds. Yet exist they did, and in determinedly pursuing their project they found practical assistance from avowedly socialist and left-wing intellectuals.

The most important role fell to left-nationalist (Ted Wheelwright and Greg Crough) and social-democratic (Frank Stilwell) members of the University of Sydney economics department.

From the mid-1970s these economists, based around the Journal of Political Economy and Wheelwright’s Transnational Corporations Research Project, became closely aligned with the Stalinist leadership of the Amalgamated Metal Workers Union (and to a lesser extent with the Building Workers Industrial Union, Seamans Union, Waterside Workers Federation, etc).

AMWU deputy leader and CPA president Laurie Carmichael, together with union research officers Ted Wilshire (a former graduate student of Wheelwright’s at Sydney, and later an Executive Director of the Trade Development Council), Bill Mountford (later CEO of WorkCover Victoria and currently a commissioner at the Victorian Competition and Efficiency Commission) and Max Ogden, had written a series of pamphlets bemoaning the state of local manufacturing. Dwindling investment and employment growth in the sector was blamed on multinational mining and energy corporations and on what Wheelwright and Crough called the Australian ‘client state’.

To reverse Australia’s gradual deindustrialization and incipient ‘dependency’, the AMWU released pamphlets (Australia Ripped Off, Australia Uprooted and Australia on the Rack) and policy reports that proposed an alternative economic strategy, inspired by the British Labour Party and Swedish social democracy. It would include ‘industry development’ programs, a ‘Department of Economic Planning’, wage restraint and consultation between trade unions, firms and governments on ways to improve productivity.

In 1982 the JAPE devoted a full double issue to these questions, including contributions by left ALP parliamentarians John Langmore and Andrew Theophanous. Stilwell later wrote a long positive article about the AMWU’s policy document.

The Australian Left Review hosted pieces by Ogden, Mountford and others. These writers spoke favourably of a wage-freezing Prices and Incomes agreement, pursuit of which had become ALP policy under Bill Hayden. Bruce Hartnett (now chairman of the Victorian State Services Authority and a director of VicSuper) advanced this ‘counter-strategy’ as the means by which Labor and unions could pursue ‘socialism.’ Using Leninist language, Carmichael dismissed ‘economistic’ struggles for higher wages, in favour of ‘political unionism.’

Yet it soon became clear that left-wing ‘strategic unionism’ was merely a formula for pursuing objectives  especially real-wage cuts for employees  held by right-wingers on the ACTU Executive (Kelty, Simon Crean), by the ALP and the policymaking elite generally, and by owners and managers of firms.

Carmichael and the BWIU’s Pat Clancy, Tom McDonald and Stan Sharkey (long-time members of the pro-Moscow Socialist Party of Australia) became prominent and fierce supporters of the Accord between the ACTU and ALP.

In 1986 Carmichael and Wilshire were sent as part of a joint delegation from the ACTU and the Trade Development Council, on a ‘fact-finding mission’ to West Germany, Sweden, Norway, Britain and Austria. The resulting report, Australia Reconstructed, suggested that Australian manufacturing should adopt features of the ‘Swedish model’, with union-led adjustments to wages, ‘work practices’ and training, as a means to ‘secure price and productivity movements in the internationally traded goods and services sector’.

Also on this trip was former CPA theorist Winton Higgins, now an expert on Swedish employment relations.

During the 1970s, Higgins had been one of many historians and political theorists, including Stuart Macintyre, Alastair Davidson, Tim Rowse, Douglas Kirsner, Kelvin Rowley and Bob Connell, to advance a Eurocommunist outlook, based variously on Althusser and Gramsci, in new journals like InterventionArenaThesis Eleven and Australian Left Review.

Arena had long expressed a fascination with technology and education as ways to bring forth socialism. The outlet therefore took a close interest in Australia Reconstructed, and during the late 1980s it hosted a debate on the report between editor Geoff Sharp (a critic) and McKenzie Wark.

The latter, who would later write for ALR, chose to hail  while ‘deconstructing’  Australia Reconstructed:

The most immediate danger for Australia is that our productive culture is not innovative. The pace of innovation in many sectors of our economy is slow, non-existent, or totally dependent on imported expertise and hardware. We have a declining manufacturing sector, not because manufacturing ceases to be a player in the hi-tech game, but simply because our manufacturing sector has suffered too long from bad policy decisions, bad management, and labour movement strategies rooted in a long-vanished past.


[Wage] militancy is not a progressive policy in its own right. Wage growth has be linked to growth in output.

By 1997 Wark was writing Derridean deconstructions of native title for The Australian, saluting Barry Jones as ‘Australia’s first postmodern politician’, describing Peter Garrett as an ‘organic intellectual’, and expressing Third Way enthusiasm for Mark Latham and Lindsay Tanner (‘The agenda for Labor beyond 2000 is clear: it has to spread the cultural and economic benefits of cyberspace’).

Soon after he emerged as an internationally prominent videogames theorist.

I’ve described the bare bones of this history in preparation for the post to follow this one. I anticipated that the argument of that next post would, in the absence of the facts presented here, seem unconvincing and provoke unvoiced objections from people unfamiliar with this material. Yet raising any of this stuff in the following post would have taken me too far afield from its main topic: the role of ‘progressive’ history, and the political and intellectual origins of progressive historians, in Keating’s ‘big picture’ of Australian nationalism.

Update: What I promised to deliver in the following post eventually came here.

Voices in the air

June 22, 2011

In his General Theory, Keynes famously wrote that ‘the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood’:

Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back… [The] ideas which civil servants and politicians and even agitators apply to current events are not likely to be the newest.

Knowing the intellectual provenance of a public policy or political slogan can give you some idea of its substance. This is the case for the the Australian government’s proposed carbon tax.

Thirty years ago it was possible to describe the environmental-policy debate between economists (within government agencies and without), as an asymmetric contest between:

  1. Those who would rely on price signals to abate pollution, either through imposition of a Pigovian tax, or through the delineation and assignment of property rights, and Coasean bargaining.

    This position harked back to the market-as-superior-information-processor arguments of Mises and Hayek;

  2. An ecological economics concerned with physical quantities, and based on the matrix notation of Sraffa, Von Neumann and Leontief.

    This group considered production to be a circular process using its own outputs (and natural resources) as physical inputs and creating pollution/waste as a joint product.

    It suggested reducing or setting targets for pollutant emissions through absolute physical limits expressed in non-price units, gesturing towards the in-kind calculation of Otto Neurath and Frederick Soddy, and socialist planning.

The argument of the first group against the second was that prices were the best indices of scarcity or social cost.

Benevolent policymakers who wanted producers in a market economy to substitute a ‘clean’ technology or production process for an environmentally-damaging, resource-depleting or pollution-intensive one should do this by allowing prices to incorporate information on the environmental effects of the respective activities (e.g. by levying a Pigovian tax).

Firms would then adjust the quantity used of a physical good or process in response to these changes in relative prices. With a tax levied on pollution, profit-maximizing firms could be expected to choose production methods that were more favourable to the environment.

The technical argument of the second group against the first rested, among other things, on the possibility that introducing ‘green taxes’ could have ‘perverse’ effects involving reverse substitution or reswitching.

This could lead to increased employment of pollution-intensive production techniques even as the ‘price’ of pollution rose, implying the non-existence of what was commonly termed an inverse (i.e. monotonically downward-sloping) ‘pollution demand function’. (Empirical examples of ‘environmental reswitching’ were given by economists such as Peter Albin and J. Barkley Rosser Jr.)

This fact about choice of technique meant that, at a given level of pollution, the elasticity of pollution with respect to a pollution tax would be indeterminate. On the other hand, and notwithstanding the claims of Morris Adelman and others, there were definite limits to the substitution between inputs, and to changes in the technical conditions of production, that could be induced by changes in relative prices (such as those resulting from a pollution tax).

Firms could deploy resources between sectors in response to price signals, but there was no equivalent substance for nature to re-allocate between branches of the ecosphere.

More generally, the projection of the physical conditions of production (a two-dimensional input-output matrix, whose coefficients specified how much of the output of each industry was technically required as an input for each other industry) on to a one-dimensional price vector represented a loss of information content. The former contained all the information necessary to compute the latter, but the reverse operation was impossible.

Price accordingly was not the ultimate bearer of information on which decisions should be based. Planning in physical units might be a better way to deal with the environmental consequences of economic activity.

Since then, the second group has largely been consigned from mainstream environmental economics to the theoretical boondocks of industrial ecology and life-cycle assessment.

The first group has secured complete scholarly ascendancy – essentially by banishing its opponent from the field. This is why the Australian Prime Minister has repeatedly seen fit to describe an ‘economic consensus’ on the need for a ‘market-based mechanism to price carbon’ and limit pollutant emissions. (So too have the Treasurer and the Minister for Climate Change).

The total victory of group (1) in the arena of ‘environmental economics’ (specifically the problem of pollution-emission abatement) has coincided with the intrusion during recent decades of the capitalist market, its characteristic modes of valuation, and private-property rights into new social domains, including higher education, health, retirement provision, entire countries, charity and now the atmosphere.

The latter item is perhaps the most tricky, presenting a high chance of instinctive resistance from the populace. People may have been taught to believe that ownership of land is natural and universal, and that essential services can be delivered more efficiently by private firms, but they have not yet absorbed the same lessons about the air above them.

One step towards accomplishing the latter task was for environmental economics to became a subset of mainstream welfare economics, concerned with intergenerational equity, externalities, public goods, bargaining games and informational asymmetries, etc. Scholars could then apply to natural resources the lessons of the Coase theorem on the need for well-defined property rights.

More than for most academic disciplines, the survival and successful transmission of a particular economic idea depends quite clearly on its utility for this or that social group.

If, as Keynes said, ruling elites and state managers are conscious or unwitting hosts of economic ideas, which dwell in books, brains and hard drives, over time the differential survival and use of these ideas will derive from how well each can be used to advance the interests of contending classes. The ‘scribbled’ ideas of some long-dead economists are evergreen; others fall by the theoretical wayside. Some are banished, sharing the fate of their unlucky constituencies; others are elevated alongside the fortunes of their backers.

This is less true for those economists who advance narrow policy prescriptions than for those propose who broad shifts in conceptual outlook. The names of Smith, Ricardo, Henry George and Keynes himself have each been closely aligned with sectional interests (e.g. urban manufacturers versus agricultural landowners, industrial and commercial firms versus bondholders). The movement of their stocks in the journalistic and political world, if not within the academy, have corresponded closely to social-political trajectories (though recently Wayne Swan namechecked Keynes, rather pathetically, for PR purposes).

Alongside the achievement of a scholarly pseudo-consensus on ‘price signals’ and ‘property rights’ as the best way to limit pollution, contemporary Australian politics has developed an ever-more attenuated ideological spectrum, in which each party with parliamentary representatives shares a common set of background assumptions regarding the role of the market.

(The Greens, who sometimes add anti-market rhetoric to their social liberalism, nonetheless officially consider themselves ‘beyond left and right’ on economic matters, and support key neoliberal nostrums. Their record as part of several state coalition governments illustrates this commitment; Tasmanian leader Nick McKim recently promised to implement ‘tough decisions’ on ‘savings and productivity improvements’ in health and education, following the savage budget of Premier-Treasurer Lara Giddings. In agreeing to the closure of 20 schools, firing of nearly 2000 public-sector workers, and a $100 million cut in public health expenditure, McKim nodded towards the previous efforts of Christine Milne and Bob Brown during the 1989-92 Labor-Greens government: ‘Once again the Greens have been prepared to help to haul the budget back on track after the spending sprees of majority governments.’)

With all members of the political class agreeing on the economic fundamentals, there is little need for any public figure to discuss them seriously, any more than there is reason for fish to debate the merits of water.

When we add to this fact how boring and forbidding contemporary economics appears to the non-specialist, we can see why public debate (i.e. that conducted outside the business media and Productivity Commission reports) surrounding the Australian government’s proposed carbon tax has been, to a truly remarkable extent, shorn of economic substance.

Both advocates and opponents have contended largely on the ground of natural science, seeking to capture its authority for their respective positions, which are supposed to follow automatically from ‘the science’.

Representatives of the government have, of course, been explicit in identifying the application of a ‘carbon price’ as a microeconomic reform in the tradition of the Hawke-Keating regulatory changes of the 1980s and 1990s: compulsory subscription to pension schemes, union-imposed wage restraint and enterprise bargaining, capital-market liberalization, tariff reduction and removal, etc.

The Hawke-era economic advisor, Ross Garnaut, has had a key public role (though I suspect his area of professional expertise is confused by many casual observers).

But these are not the sort of unwitting intellectual influences by long-dead economists, with ‘the gradual encroachment of ideas…after a certain interval’, which Keynes wrote of.

When Greens Senator Christine Milne speaks of the need for ‘price signals’ to deal with the problems of climate change, she is not repeating the distilled wisdom of Ross Garnaut or Nicholas Stern. She is, consciously or not (!), repeating the right-wing arguments from the 1920s of Mises and Hayek against the claims for in-kind calculation favoured by the socialist Neurath, the Nobelist Soddy, Karl William Kapp, Popper-Lynkeus and Ballod-Atlanticus.

Green can be gold

June 15, 2011

Behind GetUp! stand creepy figures like Evan Thornley, who among other things is a co-founder and board member of Per Capita, a ‘progressive’ think tank modelled jointly on Peter Mandelson’s Policy Network and Will Marshall’s Progressive Policy Institute.

As with its British and North American cousins, the Australian body (Per Capita) secretes an unappealing centrist brew, combining economic liberalism with the authoritarian paternalism put forward by people like Cass Sunstein (designing ‘choice architectures’, etc.).

Thornley is CEO of Better Place Australia, a company that produces battery-charging stations for electric cars.

Better Place is a key source of funding for the Climate Institute, which together with GetUp! has been the chief organizer of the public campaign ‘Say Yes to a Price on Pollution’.

In this latter enterprise, Better Place stands alongside firms including energy retailer AGL, Jemena (a privatized wing of the WA State Energy Commission), Pacific Hydro, General Electric (the world’s largest producer of gas turbines), and OgilvyEarth, a PR company specializing in greenwashing; or as its website puts it, ‘sustainability communications’ that demonstrate ‘green can be gold’:

We help brands harness the power of sustainability. Sustainability is not an abstract concept, it’s about identifying smarter ways to do more with less. OgilvyEarth partners with brands to use sustainability to drive brand value, achieve long-term growth and increase profits.

We help global brands become category leaders and change agents. We work with visionary companies that want to make sustainability a growth driver for both their business and the communities they serve. We believe that sustainability is the new path to prosperity, and in the power of communications to change everything.

To date, we’ve helped the world’s biggest organizations, including Coca-Cola, Unilever, DuPont, the Environmental Defense Fund, Kraft, IBM, the WWF and the United Nations.

Together with groups such as the Australian Youth Climate Coalition, GetUp! and the Climate Institute organised Price on Pollution rallies held in March, to build public support for the federal government’s proposed ‘carbon tax’ (promotional leaflets and videos for the events sneakily described them as supporting ‘climate action’, a purpose which organisers then described in decidedly narrower terms after the fact).

A second wave of public demonstrations took place ten days ago across major Australian cities.

It attests, among other things, to the political desperation that many people feel, and the seriousness with which they take the problem of global warming, that many thousands of people turned up to each set of events. Few are convinced by glib promises from the political right that human societies will readily adapt to climate change.

In a paper published last year in Proceedings of the National Academy of Sciences (‘An adaptability limit to climate change due to heat stress’), the authors suggested that, under increased local temperatures projected in the more pessimistic scenarios of some global-warming models, humans would find themselves unable to thermoregulate. Were wet-bulb temperatures to stay above 35 °C for extended periods, the thermal gradient allowing bodies to dissipate heat via sweating or vasodilation would be lacking, with lethal results. Under such conditions, imaginable in some currently habitable regions, continued human settlement would be impossible.

Research like this, when it reaches public ears, rightly terrifies many. So, for example, does the risk of regional inundation for various ranges of sea-level rise.

But the presence of thousands of unaligned people at the Price on Pollution rally (which was not clearly publicized as such) and Say Yes demonstration also reveals political confusion, and the effect of intense propaganda efforts. The result is that most people can’t distinguish friends from enemies.

This is by design: a feature rather than a bug. It is how popular criticism of inaction by the political class, and business-as-usual for conventional electricity generators and other commercial and industrial users of coal, gas and oil, is absorbed and diverted into partisan backing for Labor and the Greens, and lobbying for that competing sector of capitalist firms which produces wind turbines and photovoltaics.

Ordinary people are bombarded, by those such as GetUp’s Simon Sheikh, with sales talk about the renewable-energy sector as a ‘new engine of prosperity’, and exhorted to help ‘kick start investment in clean energy’ and ‘unlock clean energy’. They are informed that ‘a price on pollution’ will swiftly bring on the ‘opportunities’, ‘thriving economy, ‘green jobs’ and ‘abundance’ of a ‘clean-energy economy’.

And they are placated, told to put away the pitchforks: according to the co-founder and Chair of the Australian Youth Climate Coalition (who also works in advertising/PR), ‘[the] good news is that all the technological solutions we need to solve climate change exist today. They are already being implemented globally; from China to California, Germany to Brazil.’

The only problems are ‘old, out-of-touch men’ and ‘fear of change.’

The political character of these people is demonstrated by the national director of AYCC’s ghastly description of ‘a full-blown generational war…between young and old, past and future’:

Firstly, this debate is pitting the voices of the past against the views and perspectives of younger generations. Secondly, it’s a fight between staying locked into ancient 19th century energy technology versus unlocking the clean, renewable energy resources that will power Australia into tomorrow…

When you know that you will be directly affected by decisions made by those in  power, you think about things in a new light. It’s an entirely different  world-view to those who are only a decade or two away from leaving this world  behind…

Of course, it’s obvious why our generation supports putting a price on pollution. We need this legislation to pass to give business a reason to clean up their act and switch to more efficient ways of doing things. Unless this happens, we can wave goodbye to our futures as they drift away in carbon-filled smoke plumes emitted by polluting industry.

The other reason that young Australians  and any Australians who support the idea of progress  support a carbon price is that we want to see Australia move forward into the 21st century with a modern clean energy economy.

When I was at school, most people owned landlines! Now, few young people can fill out the “home phone” section on a form. Instead, we’ve seen the evolution from computers to mobile phones to smart phones and beyond within just a few years.

We know the same kind of progress can happen in our energy systems if only the vested interests of the past would let go. Once a carbon price and some solid renewable energy investment levels the playing field, we’ll unlock new technologies, industries and jobs that have been waiting for years to come on-stream.

This inane, polyannish pose has not been adopted to win over a newspaper readership. It is repeated on the AYCC’s webpage (as is the divisive attempt to promote an age-based identity politics, a flimsy vehicle indeed on which to carry the weighty ambitions of the body’s leaders).

Nor does it spring merely from some naive youthful optimism. Identical sentiments are expressed by representatives of the Australian Conservation Foundation, Climate Institute, etc.

The Climate Institute, which expects a ‘thriving economy’ as Australia ‘cuts pollution and modernises industry’, nonetheless cites with approval a meta-report commissioned by the CFMEU, showing the Australian coal industry also continuing to ‘thrive’ under the Labor Government’s proposed emissions-abatement policies.

And it is not merely for reasons of political salesmanship that climate change is presented as an exciting opportunity to be seized.

Indeed, the ‘level playing field’ incessantly called for by advocates of ‘renewables’ would begin via a stream of transfer payments from the state bureaucracy to the non-fossil energy sector.

This is to be expected. Like many costly public goods (railways, road tunnels etc.) and utilities, energy infrastructure is an uninviting prospect for private investors. A conventional coal-fired power station requires large fixed-capital outlays; the stock is long-lived and depreciates slowly over many decades. Stacks, cooling towers, turbine rotors, boiler tubes, coal conveyors etc. can remain functional for 40-50 years, during which period capital is immobile, even while technological innovations may occur elsewhere. The depreciation allowance then sets a limit on the rate at which costs can be recovered, capital withdrawn and transferred to new facilities or to more profitable lines of production.

Firms in this sector derive more benefits from limiting installed capacity, so that it falls short of demand, prices are bid up and profits are higher. (This is why each Australian state except Tasmania is expected to fall short of its reserve reliability margin, a safety benchmark of available excess capacity over and above peak electricity demand, within the next few years. South Australia and Victoria have already had inadequate supplies during recent summers).

For this reason, such capital-intensive projects have historically been undertaken by the public authority. More recently, government subsidies have been required to induce private involvement: these may take the form of guaranteed cash flows, as with PFI/PPPs, or tax breaks, or sale of costly assets at very favourable terms (e.g. NSW electricity).

This is also and especially the case with ‘renewable energy’, expansion of which would require huge levels of investment at comparatively high capital costs (according to all estimates from the US, UK, Australia and the International Energy Agency).

A concentrating-solar thermal installation, like those being constructed (including on US Army land) in the Mojave Desert, requires a steam turbine and power block, fields of heliostats or parabolic mirrors, as well as high-voltage transmission lines to send power to low-insolation regions. In Australia, connection to the grid is estimated to cost up to $15 per megawatt hour in remote areas.

In general, the lower energy density of renewables (energy per unit of volume or mass) compared to oil, coal and gas, plus problems with intermittency, transport and storage, mean that productivity will be lower, and cost per mW hour higher.

If ‘renewable’ operating capacity is ever to be installed, uncompetitive high-cost producers must be made confident of somehow recouping the investment of vast sums of capital. Thus the Australian government’s Mandated Renewable Energy Target provides guaranteed wholesale demand for wind, geothermal and hydro-electric electricity generators at premium long-term prices (generating units are issued with tradable certificates, the price of which is set at the marginal production cost of the least-efficient producer, allowing more efficient producers to earn differential rent).

The ‘price is set in such a way that the marginal plant coming into the market earns enough from electricity market and certificate transactions to recover the long run marginal cost of generation.’ This is to encourage a desired $11 billion investment in new renewable capacity by 2020. Feed-in tariffs, meanwhile, offer a state-level subsidy.

These public funds grant part of the ‘opportunity’ to be ‘seized’.

Of course, few people will be concerned that a maker of wind turbines is primarily concerned with his own enrichment, if his work leads to emissions abatement or the mitigation of climate change. After all, as the saying goes, it’s not from the benevolence of the butcher that we expect our nightly dinner.

Sadly, in this case, the invisible hand is not nearly so dextrous. For there are solid physical and economic reasons to suppose that growth of ’emissions-free’ electricity-generating capacity will not cause a net reduction in greenhouse-gas emissions at all.

Given the Ivanpah project that US firm BrightSource Energy, together with Bechtel, is currently developing in the desert of California’s Inland Empire, and the still-more-impressive efforts of various German firms around the Mediterranean coast, it does seem that ‘renewable’ plants will be installed up to a utility scale, that some of these plants could be commercially successful, and that ‘clean energy’ may become a ’new engine’ of profitability for some.

But, if so, this will occur even as carbon dioxide emissions increase, (thaw-assisted) drilling for gas and oil goes ahead in the Yamal Peninsula, the South Kara Sea and Alaska’s North Slope, research is explored on how to liberate methane clathrates from beneath permafrost, and fossil fuels continue to provide most of the primary energy supply for the countless conversions, reconfigurations of matter and entropy reductions that make up the productive processes of a capitalist world economy. (Thus Chevron has contracted BrightSource to build a field of solar thermal collectors to generate steam injection for enhanced oil recovery.)

Too see why, we need only look at the structural materials  steel, aluminium, plastics, cement, fibreglass  that are used in producing ’renewable’ energy.

This allows us roughly to calculate what is called embodied energy, a life-cycle assessment of the direct and indirect energy needed to produce some output, summed over each step from raw-material extraction to transport, assembly, installation and final decommissioning. Ferrochrome, the main feedstock for stainless steel, is usually held to require over 50mJ/kg; aluminium costs around 200mJ/kg.

Though domestically most Australian coal (~80%) is used for electricity generation, once exports are taken into account the majority of bituminous coal mined is used as an input in steel production. Steelmaking requires the smelting of iron in giant blast furnaces, into which coke (derived from black coal) is introduced as a reducing agent. The ThyssenKrupp steel mill at Schwelgern in Duisberg goes through 2.5 million tonnes of coke each year. Its 140 huge coke ovens, each with a 93 cubic-metre capacity, are fed with 79 tonnes of coal at a time, a cycle repeated 135 times per day.

It is almost impossible to imagine a capitalist economy without a steel industry. Not only is steel a key constituent of everything from kitchen cutlery to the reinforced concrete of buildings, but almost every production process uses machines or tools containing the material.

In concentrating-solar thermal stations, two-thirds of the material making up a heliostat is steel, as with the pylons, thermal storage tanks and pipes. And, just as in coal-fired plants, the steam-generating boilers and turbogenerators that produce electricity are usually composed of a high-chromium steel alloy. Finally, the transmission towers that support lines connecting to the power grid are built mostly of steel.

Thus one of the chief investors in the Andasol 3 plant in Spain is MAN Ferrostaal. The DESERTEC Foundation that wants to dot concentrating-solar plants across North Africa and the Middle East, then lace high-voltage direct-current transmission lines to Europe, is made up of the cream of German industrial, power-supply and engineering firms, including some of the world’s biggest companies: E.ON, RWE, MAN and Siemens as well as Deutsche Bank, Swiss-Swedish firm ABB (the world’s biggest builder of transmission and distribution grids, including substations, cables, transformers, circuit breakers, etc.) and several of their Italian counterparts.

Wind turbines, parabolic-trough collectors and electricity transmission lines themselves, on the other hand, are composed mostly of aluminium (the cables are reinforced with steel), the light, highly malleable and ductile material that is used widely in construction, transportation (jet airliners have aluminium-alloy airframes, and carry freight in aluminium ULD containers and pallets), packaging, household items, and as a heat sink in electronic goods.

As we have seen, smelting of aluminium from bauxite ore requires huge amounts of energy (more than three times as much as steel production) and water. The Alcoa plants in Victoria accordingly have their own lignite-fired power station, along with government-subsidised electricity, and other remarkable concessions, provided for in a deal signed by the ALP state premier John Cain in 1984.

To be ‘clean’, the construction of ‘renewable’ electricity-generating infrastructure would thus imply an impossible kind of bootstrapping: requiring a huge expansion in aluminium production, with the latter powered by the non-fossil energy for which it is itself the key material input. This, more or less, is the problem of energy cannibalism.

Many of the remaining industrial components of the ‘clean-energy sector’ are derived from crude oil.

Some are made from plastics (besides their more well-known use in clothes and women’s stockings, polymers of propylene and ethylene make piping and electrical-wire insulation) or use hydrocarbon feedstocks for solvents (xylene and benzene), epoxy resins and adhesives (polyurethane), insulation and lubricants.

Meanwhile, given the nature of the energy conversions involved, solar thermal plants, wind farms and geothermal are usually located far from high-load urban areas (farther, the residents of Silesia and northern Bohemia may regret, than lignite-fuelled power stations sometimes are).

The low transport costs that underlie their supply logistics are made possible by internal-combustion engines using petroleum-derived liquid fuels.

The two key prime movers of the post-1950 world economy are diesel engines and gas turbines.

All cargo ships  container ships, tankers and dry-bulk carriers  merchant fleets, and military vessels, except the largest submarines, are propelled by diesel engines. So too are the cranes that deposit and offload cargo and the trucks and trains that transship it.

The world economy of distinct production units interacting via commodity trade  tracing freight routes between terminals, entrepôts and ports in Shanghai, Singapore, Hong Kong, Rotterdam, Hamburg, and Long Beach  is unthinkable without these enormous engines. The largest specimens from Wärtsilä and MAN can weigh up to 2300 tonnes.

Meanwhile the widebody commercial jet aircraft that carry passengers and cargo between continents depend on massive turbofan engines that burn fuel derived from kerosene. The largest of these turbofans, installed on Boeing 777s, is produced by General Electric, the Climate Institute’s supporter.

The single-minded and convenient focus of activists, lobbyists, administrators and legislators on electricity generation has thus obscured some of the deeper problems posed by climate change.

The problem of fossil-fuel-based economy is not limited to coal’s use for heating and electricity, nor even that of oil for private passenger transport. The economic ‘miracle of compound growth’ has always been based on the provision of apparently free natural inputs, whose only costs are due to the labour and other commodities used in extracting them.

Indeed, under a conventional input-output analysis the economy’s productive process seems to make matter appear from nowhere, as it does not include entries for energy reserves or unused natural resources (i.e. ‘oil remaining in the ground’), depleted resources or waste produced as either inputs or outputs of the petroleum/energy industry. But, despite appearances, such a production process is conservative.

Historically, productivity growth has depended on finding fuels with successively higher ratios of energy delivered to energy costs (EROI).

A capitalist economy built on increasing labour productivity (output per unit of labour) depends on constantly raising energy intensity (energy per unit of labour) or energy productivity (output per unit of energy).

This is why, in the potted history of IG Farben that Thomas Pynchon includes in Gravity’s Rainbow, he describes industrial capitalism using the imagery of Kekulé’s famous dream about benzene’s molecular structure, in which it resembled a snake eating its own tail:

Kekulé dreams the Great Serpent holding its own tail in its mouth, the dreaming Serpent which surrounds the World. But the meanness, the cynicism with which this dream is to be used. The serpent that announces, “The World is a closed thing, cyclical, resonant, eternally-returning,” is to be delivered into a system whose only aim is to violate the Cycle. Taking and not giving back, demanding that “productivity” and “earnings” keep on increasing with time, the System removing from the rest of the World these vast quantities of energy to keep its own tiny desperate fraction showing a profit: and not only most of humanity – most of the World, animal, vegetable and mineral, is laid waste in the process. The System may or may not understand that it’s only buying time. And that time is an artificial resource to begin with, of no value to anyone or anything but the System, which sooner or later must crash to its death, when its addiction to energy has become more than the rest of the World can supply, dragging with it innocent souls all along the chain of life. Living inside the system is like riding across the country in a bus driven by a maniac bent on suicide…

Of course, socialists do not get off as easy as many like to think. Any society that wants to provide its members with a decent material standard of living must consider (for it is constrained by) the technical conditions of production: the material relations between product types indicating how much of an industry’s product is needed as input for each other industry.

At any given time, the existing technical coefficients constrain the available material transformations that economic actors may perform, e.g. the particular way in which a specific good may be made. This appears to those actors as a dependence on certain material inputs.

This dependence will not disappear with capitalism.

But it is this in-kind (i.e. non-monetary) technology matrix (of which the price list for all goods is just a one-dimensional projection, with much information lost) that must form the basis of dealing with the problems of climate change and carbon dioxide emissions.

The prevailing wisdom says that a ‘price on pollution’ will allow cost-minimizing firms to incorporate ecological information into their decisions: as individual firms maximize profit by minimizing costs, and as pollution becomes a cost expressible in monetary units, the (properly regulated) market will coordinate an environmentally rational outcome.

Similarly, in 1920 the Austrian liberal Ludwig von Mises wrote that, given the choice ‘whether we shall use a waterfall to produce electricity or extend coalmining and better utilize the energy contained in coal’, calculation must occur in terms of a single common unit.

‘Technology and the considerations derived from it would be of little use’, he wrote, ‘if it were impossible to introduce into their schemes the money prices of goods and services. The projects and designs of engineers would be purely academic if they could not compare input and output on a common basis:

The practical man, eager to improve human conditions by removing uneasiness as far as possible, must know whether, under given conditions, what he is planning is the best method, or even a method, to make people less uneasy…Such comparisons can only be made by the use of money prices.

On this view, there can be no rational decision between alternatives (say between building a new coal-fired power plant or investing in a hydroelectric turbine), without the presence of a single scalar unit by which the two alternatives can somehow be made commensurable.

To this Mises’s great opponent, Otto Neurath, replied that such a comparison took place across multiple dimensions. And for such problems ‘no longer sums of money, but things themselves [should be] taken as the basis for our decisions’:

The question might arise, should one protect coal mines or put greater strain on men? The answer depends for example on whether one thinks that hydraulic power may be sufficiently developed or that solar heat might come to be better used, etc. If one believes the latter, one may ‘spend’ more coal more freely and will hardly waste human effort where coal can be used. If however one is afraid that when one generation uses too much coal thousands will freeze to death in the future, one might use more human power and save coal. Such and many other non-technical matters determine the choice of a technically calculable plan.

We can see no possibility of reducing the production plan to some kind of unit and then to compare the various plans in terms of such units…

How can one numerically compare, beyond the amounts, things like the protection of man power with the protection of coal deposits? In spite of the most careful assessment of all qualities, with due regard to numerically estimated coal deposits yet unexploited, one can still not mark each plan by a number obtained through additions and subtractions, etc., and then take the plan which gives the biggest number.

Economic plans can be compared only in the way one compares pears and books; one can prefer one plan to another only on the basis of a total estimate.

This shouldn’t be read too hastily, as it might be, as a rejection of quantification, numerical calculation or formal decision procedures. It is rather a demand that the decisionmaker attend to the particulars themselves in natural units, rather than reduce all the multifarious dimensions to a single one (i.e. monetary magnitudes. A similar charge would later be levelled against neoclassical economists during the Cambridge capital controversy, which concerned the adequacy of aggregate measures of the productivity of heterogeneous capital goods).

The latter method (i.e. money-price calculation) is a poor surrogate for in-kind calculation, for it involves a loss of information, only taking into account things bought and sold as commodities, and neglecting the technical dependencies existing between various inputs and outputs.

Assessing a hierarchy of needs, and determining how future costs and benefits are to be discounted relative to those of the present, are political decisions that cannot be left to the profit motive:

Savings in coal, trees, etc., beyond amounting to savings in the displeasure of work, mean the preservation of future pleasure, a positive quantity. For instance, that coal is used nowadays for silly things is to be blamed for people freezing in the future. Still, one can only give vague estimates. Saving certain raw materials can become pointless if one discovers something new. The future figures in the balance sheets of the capitalist order only in so far as the demand is anticipated. The freezing people of the future only show up if there is already now a demand for future coal. Just as before, capitalism would cut down the forests even if the consequence were karstification in a hundred years. In the tropics, and elsewhere, capitalism engages in over-exploitation without any disturbance. In short, for it savings would be a loss of profits.

So it appeared in 1925, and indeed we have got erosion and sinkholes, and much else besides.

To suppose today that the profit motive is the best instrument to wield against the physical effects of climate change is a hallucination induced by the profit system itself. And the hallucination is encouraged, even among the doubtful, by media touts, political placemen and the moneyed interests that both represent.

It should be resisted.