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Showing posts with label trickle-down economics. Show all posts
Showing posts with label trickle-down economics. Show all posts

Tuesday, September 27, 2016

US Presidential Debate illustrates the Policy Divide between Trump and Clinton

 



Dr Tristan Ewins

This week’s US Presidential Debate was interesting in a number of ways.  The economic debate in particular was of concern to this observer.  In summary, it was framed with the opposition of Trump’s traditional neo-liberal emphasis on ‘trickle down’ Reaganomics, deregulation, and sweeping corporate tax cuts.  By contrast Hillary Clinton’s rhetoric was suggestive of mild social democracy or social liberalism – which has ‘learned certain lessons’ from the GFC.   Important talking points for Clinton included winding back regressive prohibitive user pays in higher education , improving the minimum wage , and promoting US interests via international trade deals. This was mildly encouraging – and perhaps a sign that a small but symbolic portion of the Sanders policy agenda had been ‘taken on-board’ in order to mobilise the disillusioned ‘progressive masses’ that had been so inspired by Sanders’ break from the ‘Democratic establishment’: which for many was actually seen to be part of  the problem.

Unfortunately what was left unsaid, here, was that the interests of US-based transnational corporations have seen US policy makers (influenced by the dominant corporate lobby) pursue trade agreements which disadvantage even traditional US allies such as Australia.  As with the Trans Pacific Partnership, the right of social democratic governments to maintain natural public monopolies in the interests of the people they represent practically stands to be ‘criminalised’ in the name of ‘free and open markets’. Here there is neither a market nook nor cranny that is spared exposure to the transnational corporations.  And the relationship between the corporate lobby and the US political class is almost a ‘symbiotic’ one.  Of course the eagerness of Australian policy makers to expose our economy to TPP must also be questioned.  Perhaps this is seen as ‘the price we must pay’ for coming under the US security umbrella.

Clinton also argued the case that ‘trickle down economics’ and radically small government had failed Americans as per the 2007-2008 Global Financial Crisis – and that Trump’s desire to ‘go into economic policy reverse’ was an unacceptable risk for the country, and indeed the world.  As per usual, Clinton also emphasised the struggles of the US  middle class when compared with ‘robber baron capitalists’ (where it was implied Trump himself fell into that category) Although Clinton did not use the expression specifically.

But the refusal of mainstream Democrats to speak to – and speak of – the working class-in their ‘mainstream’ electoral discourse provides Trump with an opening.  Here his arguments against deindustrialisation may resonate with desperate workers who are willing to try anything to secure their futures.  Though his ‘solution’ of stemming the flow of manufacturing and other jobs by deeply slashing the taxes of corporations would necessitate a decay of infrastructure, welfare and social services – where the connections between these just don’t seem to be grasped by much of Trump’s support base.  

Trump takes advantage of desperation and the sense of abandonment by many US workers with a shameless opportunism that may yet win him the ‘top job’ in the White House.  He argues as if government should be run like his own personal business.  Though it is interesting to observe that the very impetus for infrastructure projects to come in very significantly over-budget (a phenomenon he pursued relentlessly) is linked with privatisation. Parasitic corporations trying to maximise their returns ; where the sense of ‘the public good’ is lost all but entirely.  Private prisons which abandon rehabilitation and support unnecessarily-severe sentencing in favour of ‘growing their businesses’ are perhaps the most appalling example.

Clinton also argued a strong case in favour of a big investment in renewable energy: and whereas Trump is a ‘climate sceptic’, Clinton’s strong position, here, was perhaps indicative of her imperative of winning over Greens voters whose votes might be ‘wasted’ on the Greens Presidential candidate, Jill Stein.  For progressives this comprises a testing dilemma: protest against the Democratic National Committee’s appalling attempts to undermine the campaign of Bernie Sanders ; or to ‘swallow the bitter pill’ ; and admit that if Clinton is in any way ‘the lesser evil’ , then she is the ‘lesser evil’ by a very significant margin.  A big vote for Stein would make a Trump victory certain.  Though it would build a case for electoral reform – making a genuinely ‘multi-party democracy’ really-viable.

But as Clinton argued: can we trust Trump with the US nuclear codes?    Can we trust him as ‘commander in Chief’ of the world’s pre-eminent super-power?.  (though progressively under challenge from a rising China ; and from an emboldened bloc or  ‘strategic partnership’ centred on Russia and Iran)   And can we really trust him to enforce nuclear non—proliferation?

In conclusion, though, Trump actually made some telling points on foreign policy – despite the fact more broadly that he is ‘not to be trusted’.  For example the disaster of the Iraq War ; and of the regional destabilisation and escalated conflict that ensued. In Australia the lesson for us is that we must never allow such a war to ensue – with our participation and support – without even allowing a parliamentary debate.  And maybe a parliamentary vote. That is one area where the Greens actually make good policy sense.

In the debate Trump seemed ‘energised’. He spoke with apparent enthusiasm – compared with which Clinton’s demeanour was ‘steady and deliberate’ but also ‘buoyant’.  However: there was no ‘knockout blow’. The campaign is only just beginning – and has more than two months yet to run.  

Clinton’s choice of Tim Kaine as Vice-Presidential running mate was also suggestive that Clinton was intending to appeal to the ‘policy Centre’ more so than the ‘unambiguous Left’.   Again: with two months to go, though, there is still the potential prospect of more progressive policy announcements.  The Sanders campaign mobilised millions: especially amongst the young. Clinton would be well advised to go further in remobilising those people. 

And as for the Sanders campaign: socialism is increasingly ‘coming in from the cold’ in US politics.  As Sanders argued – his ‘defeat’ was not the end of the story.  Unlike with the earlier Obama campaign, the intention is that the movement itself will persist ; and continue to build and campaign openly.  While 2016 is not the year for Sanders, perhaps 2020 – or maybe 2024 – will see the resurgence of the US social democratic and democratic socialist Left.   Sanders will perhaps be seen as ‘too venerable’ by then ; but surely for him it was very much about the movement ; the policy agenda ; and a ‘political sea change’ in the US with the resurgence of a distinct and mainstream Left.  And the Democratic National Committee must surely realise that it needs to change its ways – lest the broader Party divide openly against itself.  With the consequence of a clear run for the Republicans – unless they too experience a similar debilitating split.  (not impossible given what we have seen this year)

Here’s hoping for a Clinton victory: and that we may be pleasantly surprised with more favourable policy announcements from a Clinton campaign which realises the imperative of mobilising the movement mobilised itself before-hand by Bernie Sanders.

Saturday, July 9, 2016

Turnbull by the Narrowest Margin - And Why a Return to Abbott and Conservatism is not the Answer for the Liberals



Much has been made of the so-called Labor 'Medi-scare' Campaign.  But reflection suggests Turnbull has only himself to blame for pandering to the 'big 'C' Conservative' wing of his Party - with the profound disillusionment from liberal-minded voters who were originally so encouraged by the departure of Abbott.  For the same reason 'a return to Abbott' is not the answer for the Liberals. In the end the Liberals did not 'tack to the Centre' after all.  And if the Liberal Party swings Right chasing after the votes of the Hansonites that will only provoke further disillusionment from the 'liberal relative Centre' voter demographic.

  

Dr Tristan Ewins
 
With the cliff-hanger/apparent-Liberal victory in the 2016 Australian Federal Election there have been calls from Conservative quarters for the removal of Malcolm Turnbull.  The argument goes something along the lines that because Turnbull abandoned the Liberal base he was punished accordingly.  And that a more decisive Liberal victory would have been possible under Tony Abbott.

Certainly the cross-benches will likely be volatile.  The Government could expect to be put into difficult positions on gambling regulation (Xenophon), law reform and legal euthanasia (Hinch), protectionism (Katter), and totally-unworkable policy objectives based on xenophobia. (Hanson)   Cathy McGowan will probably tend towards to the liberal Centre.  Lambie can be unpredictable – but also in some ways progressive on the economy. (take her support for a financial transactions tax)  She also opposes Same Sex Marriage. 

The Greens will quite possibly enter into negotiations with the Nick Xenophon Team to link their agendas in the context of balance of power in the Senate. The hope is that they will oppose austerity and regressive re-casting of the tax mix – leaving fair tax reform as the only remaining option for budget repair.  (though some are saying the Conservatives may respond with a new election)  But the Greens have failed to pick up new Lower House seats from Labor.   In the Lower House Wilkie can be depended upon to be critical, consistent and progressive – as past experience shows.
 
Already there are arguments to the effect that a hung parliament threatens Australia’s AAA Credit Rating.  The arguments can be summed up in that the various sectional interests will get in the way of ‘hard headed action on budget cuts’.  Though again: few are considering the genuinely-existing alternative of budget repair without austerity – on the basis of progressive tax reform.   Budget cuts also threaten the infrastructure and services the economy craves: resulting in something of a ‘false-economy’.  If possible Labor needs to link-up with Xenophon and the Greens in the Senate to progress the agenda of budget repair without austerity. 

Those Liberals who aren’t braying for Turnbull’s blood are indignant about the so-called ‘Medi-scare’ from Labor.   Yet the reality is that the fear out there in the electorate goes back to the 2014 Hockey Budget ; with its various Medicare co-payments, and other ‘cuts to the bone’.  Labor’s efforts here were nowhere near as objectionable, say, compared with the Howard-Era Liberal government’s ‘children overboard’ panic,  or more recent talk of a ‘war on business’; and so on.  In fact Labor’s interpretation of Medicare privatisation is entirely reasonable if realised as opposition to the winding back of socialised medicine in this country. That the Federal Police are being deployed apparently as a Liberal political asset is perhaps a threat to our democracy.

Turnbull’s alleged ‘Centrism’ is not the cause of the ‘political-near-death’ of the Federal Liberal Government. Turnbull had extensively compromised in order to keep the big ‘C’ Conservatives within the so-called ‘big house’ that is the Liberal Party.  He compromised on same sex marriage ; and on climate change and refugees.  He made billions in inhumane and profoundly regressive cuts in areas like Aged Care.  As opposed to the line being drummed up by Andrew Bolt and other arch-Conservatives : if anything it was sheer disappointment from the ‘small ‘l’ liberal’ demographic in the broader electorate that resulted in the hung parliament. 

Talk now of a ‘new Conservative movement’ – and hints from Bernadi of a ‘new Conservative Party’ illustrate a bitterness within the Liberal Party that goes back to the palace-coup against Abbott.  Regardless of this –any new Conservative movement will need to navigate the contradictions between Liberalism and Conservatism.  For self-espoused Christians heartless LNP policies on defunding an Aged Care sector already characterised by regressive user-pays mechanisms - need to be rejected utterly. Hence ‘Compassionate Conservatives’ have cause to oppose ‘Austrian School-style small government’ and its human consequences.  While small ‘l’ liberals have cause to fear regressive Conservative encroachments on civil and even industrial liberties.   Perhaps the Liberals could even learn from the example of the post-war (1950s) German Christian Democrats and their aim of 'a social market economy'.

By tearing themselves apart the various LNP Liberals and Conservatives may well prove themselves unready for government.  But would a Liberal Party freed from its right-wing once again embody the spirit, say, of Don Chipp; of the later Fraser ; or even the critical disposition embodied by internal critics such as former Liberal leader John Hewson?  Would it become a ‘small ‘l’ liberal party?  Could the Liberal ‘Wet’ faction re-emerge somehow from oblivion?  Or would the LNP  still adhere to ‘large ‘L’ economic Liberalism – leaving dominant narratives of austerity, privatisation and laissez faire untouched?   Turnbull’s capitulation to the ‘big ‘C’ Conservative’ right-wing of his Party during the campaign suggests the latter scenario is more likely.  As they do tend to embrace 'big 'L' economic Liberalism as opposed to 'small 'l' liberalism'.
 
There was talk under Turnbull of the Liberals ‘shifting to the Centre’.  But remember that the Centre is always relative ; and what matters most is the substance which prevails beneath the relative labels.  Moves amongst parts of Australia’s ‘liberal establishment’ (eg: in Fairfax) suggests all-too-ready a willingness to ‘settle’ with the Liberalism of Turnbull ; even when much of it proved to be compromised and hollow.

The real problem with the Turnbull campaign was its shallowness.  That is, the shallowness of mantras of ‘jobs and growth’, and the incredibility of the notion $50 billion in Company Tax cuts  (and even more over time) would ‘trickle-down’ to benefit everyone.  And this at the same time as the government proclaimed a ‘Budget Emergency’.  This was not small ‘l’ liberalism. It was the spirit of Reagan and Thatcher.

It wasn’t political and social liberalism that ‘did Turnbull in’ with a ‘near-political-death experience’.   It was laissez faire : with the LNP apparently having learned nothing from the overwhelming public rejection of the attempted hard-line Hockey Austerity Budget of 2014.


(Postscript: A friend in the Labor Party cautioned me that an open split in the Liberal Party could have bad ramifications long term. He argued that at least the LNP is not radically nationalist and openly accepting of racist Ideology. And who knows what might fill any vacuum? Though I still think LNP members need to reflect seriously upon two policy fronts : The incompatibility of heartless neo-liberalism and attacks upon the vulnerable with the 'compassionate conservatism' some Christians would like to profess ; and the infringements upon civil liberties arising from 'Big 'C' Conservatism' in this country. We need the Liberal Party (and hence the whole relative political milieu in Australia) transformed as a consequence of pressures on both these fronts.)
Our next post will consider the dilemmas facing Labor following the election outcome.
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