BY PETER BOYLE
Rupert Murdoch's Australian newspaper has been running a series
of articles on the impact of economic deregulation in Australia. Entitled
“Advance Australia where”, it analyses the results of studies commissioned
from the National Centre for Economic Modelling (NATSEM) at Canberra University
and a Newspoll survey of attitudes to these changes. It sounds like a scientific
exercise but the series is actually a political argument against growing
public dissatisfaction with neo-liberal economic “reform”.
The June 17-18 Weekend Australian's editorial summed up the “problem”
as:
“Two decades of living and working in a more open economy have produced
a disturbing paradox: we are wealthier, as the textbooks said we should
be; in the main, however, we do not feel happier, or even more prosperous.
The economy is flowering, but in a climate of discontent.”
The NATSEM study showed that while nearly all Australians had obtained
some income rises in the 15 years to 1997, there had been a sharp rise
in income and wealth inequality. That probably didn't surprise the Australian's
editors. What shocked them was that the Newspoll survey indicated that
only 31% of Australians thought that life was getting better, and 70% would
prefer the gap between rich and poor to get smaller rather than have the
nation's overall wealth grow as quickly as possible.
Obviously there is a massive problem of false consciousness. Australians
should be feeling good, the editorial complained, but “We are instead
too inward-looking and envious, fearful of the future but materialistic”.
The editorial identifies the heart of the problem as a misplaced public
nostalgia for the idea of Australia as an egalitarian society. “These perceptions
may always have been myths but they were powerful and central to our sense
of identity. They were tied into our view of ourselves as the classless
society -- long a comforting myth but entirely unsustainable now.”
Federal workplace relations and small business minister Peter Reith
grumbled about the “politically correct” shyness of some Australians to
“speak out loudly for the values of entrepreneurship, risk-taking and profitability”.
The Australian's chief political editor, Paul Kelly, diagnosed a
society with a “split personality”. Anxiety amid prosperity must be a symptom
of mass psychological problems, he figured, as he pointed his finger at
a disgruntled “middle class”.
U-shape or J-shape?
Kelly claimed that the NATSEM income studies reveal a “new U-shaped society”
in which the rich and the poor made the biggest gains while the middle
income earners lagged behind. Of course, to see this U-shape you have to
believe that a 32% ($55 per week) increase in income for the poorest 10%
of households is comparable to an average 12% ($190 per week) increase
in incomes for the top 10%.
In dollar terms, what we have is more a J-shape. However, even the dollar
comparison is inadequate because the real rich, the big capitalists, are
only a minor proportion of the top 10% and for them “income” is a flexible
concept worked out by their accountants.
If you compare average incomes for the various categories, the J becomes
even clearer. The top 20% earn, on average, 13 times more than the poorest
20%, according to the Australian Bureau of Statistics.
But if you break the top income categories into smaller percentile lots
you get an even better picture of the growing income inequality. Australia's
20 highest paid corporate executives pay themselves $1-7 million a year
each in directors' fees (and that's just part of their income).
At the other end of the income scale, the misleading rosy picture suggested
by the 32% income increase for the poorest 10% (over 15 years) belies the
reality of the new working poor and the 230,000 extra jobless families
created in the last two decades. But from the perspective of the ruling
class, voiced by the Australian's editors, the welfare system is
looking after the poor so we don't have to worry about them.
Working harder
By themselves, income statistics cannot explain why most people don't feel
better off.
Most households maintain their incomes only by working a lot harder.
As the former Paul Keating Labor government once admitted, most working-class
families didn't experience a major fall in income in the 1980s mainly because
they became two-income households. These households are putting in much
more effort just to keep things together.
In addition, workers have obtained all wage rises since the mid-1980s
by trading off working conditions; the exploitation of wage earners has
intensified. The result is greater stress, tiredness and a poorer quality
of life that is not compensated for by a few dollars extra each week.
There is the added insecurity that a growing proportion of workers face
arising out of greater casualisation of labour, erosion of awards and the
rise of individual contracts. Workers feel all the more insecure because
there are more than 750,000 jobless people, even after 10 years of economic
growth. The official unemployment rate (6.7%) has yet to fall to the level
it was at the peak of the last economic expansion (5.8%).
Income and wealth
The
Australian's
editors down-played NATSEM director Professor
Ann Harding's statement: “The research shows the income gap is increasing
inequality, but also that wealth inequality is accelerating at an even
faster rate”. Few statistics on this were published in the series of articles
and only a careful reader would have found them buried away in an article
by Kelly attacking un-named “special interest groups” for exploiting concern
about rising inequality to advance their narrow self interests:
“The latest estimates from Access Economics [a big business research
group] in January document the growing wealth concentration in the 1990s.
They show that 50% of Australians own 94% of total wealth (the same figure
as 1993); the top 10% own 49% of wealth (a lift from 44% in 1993); and
the top 1% own 16% of total wealth (a strong rise of one-third from 12%
in 1993).”
As Harding explained, the growing wealth inequality guarantees further
increases in income inequality because under capitalism wealth translates
into the power to make other people make more money for you.
Harding found that in 1996-97, the top 10% received 49% of all income
from assets (interest, rent, dividends), an increase from 39% in 1982.
Reith talks about the importance of “wealth creation”, but most people
believe in wealth creation like they believe in the Tooth Fairy. Profits
don't come from thin air and they certainly don't come from the hard work
of the capitalists. You don't have to be a Marxist to figure out the direct
link between capitalist profits and exploitation, especially when you are
on the receiving end of this equation.
Ideological crisis
The problem for the capitalists and their loyal servants at the
Australian
is that people no longer buy the ideological hogwash the rulers used to
pave the way for the great wave of privatisation, austerity and attacks
on workers' rights of the last 15 years. This total class offensive on
the rights of the majority was prepared for by a concerted ideological
campaign to justify neo-liberal economic reform, but their arguments are
coming apart at the seams.
When a worker on $385 a week is called “greedy” for demanding a pay
increase of $24 while a corporate executive can get an increase of several
times the minimum wage because it's the “global market rate”, something
stinks. It's fine for them to be greedy but we are not allowed
to ask for a slightly bigger share of the product of our own labour.
Similarly, you don't need an economics degree to see that the International
Monetary Fund and the World Trade Organisation are really about squeezing
even more out of the Third World.
In part, the capitalist ideological crisis is built on the success of
the capitalist ideologists in the 1980s and '90s. Their program of neo-liberal
economic “reform”, implemented by governments around the world, has made
a world where the majority is forced to work harder and be more “flexible”
to enhance the profitability of the capitalists. We've got the brave new
world they wanted and, frankly, it sucks.
It was claimed by the advocates of “economic rationalism” that privatisation
and economic deregulation would make for a more efficient and prosperous
society where we would all be winners. Now the trains don't run on time
(if they run at all on your line) and we have to queue for years for serious
medical operations.
Simultaneously, they encouraged a narrow individualist outlook. John
Howard's hero, Margaret Thatcher, even asserted that there was no such
thing as society. Now the social destructiveness of this course is being
felt and people don't like it.
And it is not fundamentally about whether Joe or Jane Bloggs has forced
a few more dollars out of the boss. It's the social cost that has
provoked the first major wave of political backlash against neo-liberalism.
It's coming particularly from the smaller cities and towns in rural and
regional Australia which have experienced a dramatic collapse in social
structure as a direct result of neo-liberal “reform”.
Murdoch's scribes shouldn't imagine that the problem will stop there.
The statistics show that it's not just the bush that is suffering; the
poorest suburbs in the major cities have experience serious declines in
average household income and chronic unemployment, as well as the resulting
social ills of crime and drug and alcohol abuse.
These marginalised populations haven't directly impacted on politicians
as much as rural populations have, but they will. Recently, the NSW police
released an index of the incidence of crime by locality and there were
a few shocks for people in comfortable, leafy suburbs.
Murdoch's hacks unleashed
Murdoch's hacks know what to do when the peasants are unhappy. They seek
out the ringleaders and try to isolate them. On the issue of inequality,
they have decided to attack those concerned as, at best, misguided or “perverted”
do-gooders and, at worst, fraudulent special interest groups.
Journalist George Megalogenis began by bemoaning that “globalisation
had taught us to want more, but when we get it we're not satisfied because
we believe we're entitled to more again”. He warned: “Many of the winners
from the economic and social changes of the last two decades are convinced
that they, too, are losers. When the winners start whining, they risk drowning
out those who do need help.”
Megalogenis adds that it is mainly the over 35-year-olds who are worried,
“because they experienced the comfortable and relaxed times of working
behind the tariff wall”. It's a neat line, but the Newspoll results show
it's a lie: 67% of 18 to 34-year-olds also preferred the gap between rich
and poor to get smaller.
Allan Woods, the Australian's economics editor, railed against
the “envy perverts” who are calling for more equity. The Newspoll survey,
he said, uncovered “an obsessive and unhealthy concern with income distribution”.
Woods argued that it is “human nature” to want more, even when you are
getting plenty, and that, “When some groups are seen to be doing better
than others, resentment becomes a powerful force. This is exaggerated in
Australia and New Zealand by a form of socialism inherited from the UK
in which a virulent envy, disguised as concern with equity, is predominant.”
Kelly charged that “much of debate about inequality is a fraud. Inequality
in Australia today is a serious social issue but it is rarely discussed
as such -- more often than not it is a rhetorical weapon deployed by special
interests to argue for a special deal.”
But the 70% concern about rising inequality is not simply a symptom
of a society with an over-developed sense of egalitarianism. Nor is it
coming from suckers for the rhetoric of “special interest groups” seeking
to profit from higher tariff walls.
People can see the erosion of public education and public health. We
can see the blatant robbery that is being passed off as “tax reform”. People
do think that the capitalist politicians and the big business media hacks
are full of shit.
Kelly asks why there aren't yet serious campaigns for measures to eradicate
inequality through income redistribution. The answer is that while the
capitalists and their hacks are beginning to lose the majority at the ideological
level, this has yet to turn into a real fight back against the capitalist
offensive.
But that is coming and, when it does, quite possibly we won't be fighting
just for the redistribution of profits but for the expropriation of the
profiteers!
[Peter Boyle is a member of the national executive of the Democratic
Socialist Party.]
