The Wisteria Diary – So we’re all socialists now?

 

Remember all those articles that have been churned out over the last couple of years about the current Federal Government’s lack of an agenda? They were fair enough in their time. The Coalition’s well established enthusiasm for shutting down parliament was at least in part to minimize the days embarrassingly devoid of any legislation to debate. Those days are well behind us now.

 

Events have thrust upon Scott Morrison an agenda he couldn’t have imagined until a few weeks ago. Having spent more than a decade finding fault with the Rudd/Swan stimulus of GFC days, the Coalition now finds itself proposing public expenditures of a dimension that make Kev and Wayne look like pikers. One of the few certainties we can predict is a buyers’ market for Back In Black mugs. They’re headed to a discount store near you.

 

Of course, the Liberals’ rhetorical disdain of stimulus policies always owed more to historic fortune than scrupulous ideology. Since World War Two, luck has largely found them out of government during the big economic disruptions.

 

Economics is a funny game. Prior evidence suggests that given the choice between $5 and an economist’s forecast, you’d probably better take the fiver. At least you’d be sure you could afford a cup of coffee. But economic history also makes a near certain favourite of the fact that, confronted with a crisis, most governments will quickly get a case of dat ol’ time Keynesian religion. Ours certainly has. Big time. That would suggest that the forecasts they were privy to were not something you should be showing the kids before bed time.

 

But I don’t get why some are calling this socialism. If you’re writing op eds suggesting Scomo has nicked Che’s beret and headed for the Sierra Maestra, I’d politely suggest you haven’t been listening to what he’s saying. The word “hibernation” has only been give the odd thousand or so runs over the last few days. For once, I reckon they mean what they’re saying. They have no intention of reallocating the resources of production in the long run. Vast sums are about to be expended in the hope that we can pick up more or less where we left off, once we’re on top of the virus.

 

Is it going to work? Don’t ask me. I’d doubt the government really knows. This is not a straight forward economic crash, should such a thing ever really exist. We haven’t had a public health crisis of these dimensions since long before we created the modern, globalized financial system. So much could play out in so many directions. I invite you to submit your own best guess.

 

What the government intends is effectively a pop-up version of a welfare state. To their credit, a mob that has never shown much policy initiative over a number of years has been able to make some very big calls very quickly. As any victim of our recent bushfires will attest, the difference between promise and delivery can be vast, but with so much happening at such pace we’ll only truly be able to assess that as it evolves. We will hope the problems there might inform the present.

 

It’s hard to see how our politics won’t be more energized for the near future. Though that isn’t saying much. Our government finds itself the custodian of arrangements it will want to disassemble at some stage in the future. That won’t be straightforward. Any politician knows it is easier to give than to take away. And a Labor opposition that has conspicuously struggled to process its defeat at the last Federal election now contemplates the fact it is effectively outflanked on the left, in economic terms, by its conservative opponents.

 

While most of us hunker down and try to wait all of this out, it might just pay us to spend a little time contemplating what version of “normal” we actually want to return to. One statistic that’s had a workout in the last few days is that Australia’s 117 billionaires have an approximate wealth between them of $378 billion. It also occurs to me that just in my lifetime, we’ve endured the following financial crises: the 1970’s Oil Shock, the 1987 stock market crash and the millennial Dot Com crash. Then came the daddy of them all, the Global Financial Crisis, the consequences of which we still hadn’t fully processed before this current catastrophe. Before we can even have a discussion about the fairness of “normal”, are there not accumulating reasonable grounds to question whether “normal” is even sustainable?

 

 

 

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About John Butler

John Butler has fled the World's Most Liveable Car Park and now breathes the rarefied air of the Ballarat Plateau. For his sins, he has passed his 40th year as a Carlton member.

Comments

  1. Mark 'Swish' Schwerdt says

    JB, the right will never again be able to claim that particular social welfare measures are “unaffordable and will only send the country bankrupt”. I hope this leaves those IPA pricks irrelevant too.

  2. John Butler says

    Swish, logic would suggest you’re right. But we’ve seen influence overwhelm logic far too often in recent years to be certain.

  3. Interesting JB. Of course its also interesting that it was the golden boys of Labor’s recent history who initially opened our economy to the world; to globalisation: Hawke and Keating. Some good and a lot of bad has come of that. Was that just luck?

    I think the globalisation over the last few decades, the policy that has stripped our country of manufacturing and agricultural industries, the policy that has flooded our economy with cheap crap whilst locals lose their jobs, the policy that sees us importing oranges from California whilst local orchardists plough their fruit trees into the dirt, the policy that successive governments of all persuasions have had an unhealthy if not zealous attachment to, will end. At least as we’ve come to know it. Which is a good thing.

    I hope we re-set after all this. I hope ideology is not at the forefront of the resetting. I hope rusted on “us and them” nonsense disappears. We will have a once in a generation(s) opportunity. But I expect we’ll blow it.

  4. John Butler says

    A lot of truth in that, Dips.

    I reckon much of Labor’s struggles in the last 20 years have come because they haven’t really ever reconciled the complicated legacy Keating, especially, left.

    Will we leave ideology behind? There’s nothing like an emergency to sideline ideological concerns with blunt reality, but a lot of business models have been constructed to serve particular ideologies. They might be sidelined, but they haven’t disappeared.

  5. Excellent summation, JB.
    I would like to think that Swish will be proven correct, but I fear that the IPA and the neo-liberals are all merely hibernating at present.

  6. John Butler says

    Smokie, one thing that will keep us entertained through the coming weeks will be the verbal and intellectual gymnastics required of many in the effort to preserve face.

    Is Nadia Comaneci anywhere handy?

  7. Excellent read JB.
    Capitalism is deeply broken and the wheels have come off democracy.
    Perhaps it’s the pandemic we had to have.

  8. Food for thought JB.
    This pandemic is a serious test of politics and society. When it eventually passes and we view the toll, what then of dealing with climate change? Will there be anything left in the financial and emotional bank to do anything about it?

  9. John Butler says

    JD, just how much gaffer tape is there still to go around?

    BJ, that’s the really big question, once we get past all the current really big questions. As has become par for the course in times of crisis, some corporations and politicians have already made their move – Keystone pipeline in Alberta, just to name one.

    Thanks for reading.

  10. If only it was socialism JB, not just the state bailing out the fact that despite the rhetoric the superiority of the free market is BS.

    I recall working in a well known specialist public hospital back in the late 80’s into the mid 90’s.Every year the hospital had a surplus budget, in case of any future emergency.Then the paradigm changed, as we heard ad nauseum about the bloated public service, the superiority of the private sector, blah, blah, blah.Subsequently in the health field we’ve endured numerous funding cuts,and the corporatisation where we’re meant to run as a business.Work to a skimpy budget; no more surpluses for that rainy day.

    Where it goes from here is an unknown. Hopefully we get a world more premised on co-operation than competition. Do we fall deeper into the brutality of social Darwinism,or move in a direction where the primacy of public need surpasses of public greed?

    As an essential service worker i find everything is moving so quickly, but not necessarily coherently. We’re working hard, yet do we have the resources? I’m aware of other parts of the world where communities mobilise themselves to support their existing services. People power to beat the pandemic ? Let’s give it a burl.

    Glen!

  11. When I have no bloody idea I look to what history tells us. WW1 and the Spanish Flu was quickly followed by the Roaring 20’s. But that history was mainly written in the US which was particularly late to the Great War dance and only peripherally affected.
    Then the Great Depression stemming from Wall St getting too far ahead of itself. The penal reparations from WW1 gave rise to Hitler (elected at first by the suffering resentful German people). We learned those lessons after WW2 with the Marshall Plan giving us powerful industrial democracies emerging from the German and Japanese ashes.
    American industrial production was rapidly translated from munitions to Buicks; combined with the rapid technological gains war always produces (long distance flight; radar; antibiotics) to power US economic growth in the 50’s and 60’s. Australia did alright on “the sheep’s back” as a primary producer.
    The UK stayed bleak for nearly 20 years until the Beatles and the mini (skirt and car) propelled some dynamism back into the economy.
    Which are we going to be in the aftermath of CV19? We’re a trading nation. We can be self sufficient and poor; or open and prosperous – but not both. As ever our future is tied to being a raw materials (minerals and food) supplier to wealthy industrial countries. And selling high value services (education and holidays) to their wealthy citizens.
    While there are valid concerns about how much the world has become dependent on stretched “just in time” supply chains – a return to protectionism and an isolationist world outlook will cripple our capacity to pay for our expansive welfare state and service the debt we’re running up. 40 cent $A?

  12. Swish, i totally concur about the IPA. They’re the most powerful political entity in Australia, yet this shadowy, powerful cabal are almost unknown to the public. The glaring inadequacy of neo-liberalism is there for all to see.

    PB, you break the standard perception of a Westralian. You present as some one who is well read, thus nuanced in your comments. I concur with aspects of your posting.For all its obvious globalisation as we know it has its obvious limitations: too many for my brief spiel. However the future can’t be reduced to a limited dichotomy of neo-liberal capitalism, or the old protectionist model of capitalism. Surely in the 21st century we can move beyond that paradigm. In this time of global crisis a co-operative approach is the way forward for humanity, hopefully meaning some radical change(s)..

    Do yourself a favour. Have a bo-peep of the writings of someone like Aaron Bastani, as a way of changing the dominant paradigm. It might help move humanity forward in a way benefitting/befitting us all.

    Glen!

  13. Punx Pete says

    ‘What the government intends is effectively a pop-up version of a welfare state.’ Love that line.

    Great read John. I suspect globalization won’t be affected too much by these events. At least in Australia. We’ll remain a quarry and the countries that provide our goods will continue to exploit their workers. I think we’ll just be all the more skittish about how exposed that leaves us. Disturbing as that is, what really concerns me is the effects this catastrophe will have on transitioning to renewables. I see the coalition (and other big polluters like the US) using the cost of the Covid as another excuse to put it off. Greta and her generation are gonna have their work cut out pleading with Governments who cry poor about ‘Now not being the time for costly renewables infrastructure.’ Sh*t, she’ll have to ramp up her ‘How dare you’s?’ to whole new level of disgust! But at least she’ll have my ear.

    And while I’m here, the US just clicked over 300,000 known cases. And yet they still have some states where it’s pretty much business as usual? Wow. But that’s what you get when you have an idiot as a president. Trump? If there’s one thing we’ve learnt from this Trump experience, it’s that democracy has a fatal flaw. And that is, if ignorance reaches a critical mass, an idiot can be elected. But maybe we already learnt that with Abbott?

  14. Punx Pete, Trump is a statesmen compared to Bolsanaro in Brazil.

    Who knows where/when/how we come out of this? It’s hard to see it remaining business as usual, with us either heading into a more pernicious form of Social Darwinism, or more positively a more co operative world.

    Let’s not pretend the government bail outs of corporate failures has anything to do with socialism. It’s state capitalism picking up the pieces of the inadequacy of the much vaunted private sector. There’s a well established pattern here.

    Glen!

  15. John Butler says

    Thanks for the comments, Glen, Pete and Pete.

    As I said in the piece, I want to try not to pretend I know more than I do re all of this. But I am happy to relate what I think.

    Re the IPA: I don’t think most people regard them as a serious source of objective research or information. They are spokespeople representing the interests of the business models of their anonymous donors. They have many equivalents in America, and elsewhere. They only really matter to the extent they influence policy making, and there is evidence that they have done so. I think they will have a trickier time prosecuting some of their favourite arguments in the current circumstance. But we’ll see.

    Re the USA: one thing that has worried me about our politics in recent years has been the increasing indulgence of the sort of ideological fantasy nonsense that has overtaken much American political discourse. The real world consequence of that in the face of an actual crisis is now playing out throughout the USA. It won’t be pretty.

    Up to now, I’d regarded our local indulgence of that nonsense, which was never really a good fit, as a sign of paucity of imagination from what has been, to be honest, a pretty undistinguished Australian political generation up to now. It is with considerable relief that we can say that, faced with an immediate crisis here, all that ideological pretense has been pushed aside to deal with reality. Whatever its faults, and they haven’t magically disappeared, at least our politics can still grapple with reality when it is forced to.

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