Saturday, June 27, 2009

John Passant on the Revolutionary Party

above: In the tradition of Lenin, John Passant believes in the necessity of a revolutionary party...

nb: immediately below this is another contribution of Lev's on the subject of "revolutionary reformism'. Below that is another essay by Wes Bishop. Wes considers the question of reform or revolution from a liberal perspective. Both contributions are well worth the read.

One of Lenin's great contributions to humanity was to reclaim Marx's insight that the working class could not simply lay hold of the ready-made apparatus of the state machinery and wield it for its own purposes. It had to smash the capitalist state.

This was not through some top down revolution, but by revolution from below.

History supports me. Workers in struggle could and often do create their own democratic organs of rule that replace the dictatorship of capital over labour. Iran in 1979 was one example.

These two ideas were reflected in a third historic task - to build a revolutionary organisation to help achieve the goal of the working class in power, ruling through their own democratic institutions. As Marx said in the Communist Manifesto:

We have seen above, that the first step in the revolution by the working class is to raise the proletariat to the position of ruling class to win the battle of democracy.

The proletariat will use its political supremacy to wrest, by degree, all capital from the bourgeoisie, to centralise all instruments of production in the hands of the State, i.e., of the proletariat organised as the ruling class; and to increase the total productive forces as rapidly as possible.

Lenin's ideas about a revolutionary party are relevant today. They have been the subject of incessant bourgeois derision, most of it historically incorrect. We have already published on this site a review by Mick Armstrong of Lars T Lih's book 'Lenin rediscovered: What is to be done in context. It's called Lenin, democracy and the way forward for the left.

In short this review encapsulates Lih's argument that 'What is to be done' is actually a reflection of the ideas of revolution from below (not conspiratorial approaches), that the workign class is capable of much more than trade unionism, and that the party it builds is the political expression of the 'vanguard' but that that vanguard can win the battle of ideas to become the political majority in the working class.

The battle is not linear but ongoing, and has ups and downs, in the main depending on the swings and roundabouts of the class struggle.

And of course the party is not separate from the class but part of it and learns from the class as it finds its voice over time, ie as the class becomes not only a class of itself but for itself.

Lenin's organisational approach actually reflects the Marxist idea of socialism from below, of, as Marx put it, the emancipation of the working class being the act of the working class, a movement of the vast majority in the interests of the vast majority.

The relationship of party and class is always complex but as Trotsky put it (or words to this effect), in a revolutionary situation the class is the steam that drives the pistons of the party.

The point is to build a party over the years of struggle that can succeed in that task.

That means years of slow recruitment and steady building based on ideas, with the inevitable upsurges in struggle momentarily destroying the facade of capitalist order and rule and providing further opportunities to influence and grow as history shows the value and worth in practice of revolutionary socialist ideas.

Apart from socialism from below socialism has another side - socialism from above (or perhaps now more accurately described as reform from above.)

As Hal Draper has written in his magnificent book The Two Souls of Socialism:

Throughout the history of socialist movements and ideas, the fundamental divide is between Socialism-from-Above and Socialism-from-Below.

What unites the many different forms of Socialism-from-Above is the conception that socialism (or a reasonable facsimile thereof) must be handed down to the grateful masses in one form or another, by a ruling elite which is not subject to their control in fact. The heart of Socialism-from-Below is its view that socialism can be realized only through the self-emancipation of activized masses in motion, reaching out for freedom with their own hands, mobilized "from below" in a struggle to take charge of their own destiny, as actors (not merely subjects) on the stage of history. "The emancipation of the working classes must be conquered by the working classes themselves": this is the first sentence in the Rules written for the First International by Marx, and this is the First Principle of his lifework.

It is the conception of Socialism-from-Above which accounts for the acceptance of Communist dictatorship as a form of "socialism." It is the conception of Socialism-from-Above which concentrates social-democratic attention on the parliamentary superstructure of society and on the manipulation of the "commanding heights" of the economy, and which makes them hostile to mass action from below. It is Socialism-from-Above which is the dominant tradition in the development of socialism.

Draper went on to say:

It was Marx who finally fettered the two ideas of Socialism and Democracy together because he developed a theory which made the synthesis possible for the first time. The heart of the theory is this proposition: that there is a social majority which has the interest and motivation to change the system, and that the aim of socialism can be the education and mobilization of this mass-majority. This is the exploited class, the working class, from which comes the eventual motive-force of revolution. Hence a socialism-from-below is possible, on the basis of a theory which sees the revolutionary potentialities in the broad masses, even if they seem backward at a given time and place. Capital, after all, is nothing but the demonstration of the economic basis of this proposition.

It is only some such theory of working-class socialism which makes possible the fusion of revolutionary socialism and revolutionary democracy. We are not arguing at this point our conviction that this faith is justified, but only insisting on the alternative: all socialists or would-be reformers who repudiate it must go over to some Socialism-from-Above, whether of the reformist, utopian, bureaucratic, Stalinist, Maoist or Castroite variety. And they do.

It is this conception of socialism from below that drives people like those of us associated with Socialist Alternative to build a revolutionary party, to win the battle to meld democracy and production for need.

There is no revolutionary party in Australia, let alone committed to socialism from below. Socialist Alternative is not a party but a small organisation.

At the moment it is in the battle of ideas that such an organisation can work and build for the future. The organisation will also involve itself in any actions which arise but in the main cannot initiate them or influence them given our small size.

All the time the goal remains socialism from below.

This means rejecting laborism as a false way forward for the working class.

Given the history of a hundred years of sellouts of Labor this is not that hard to do (except when discussing matters with the more dogmatic members of the various socialism from above groups.)

We need to be clear - the idea that capitalism can be reformed through Parliament into socialism is essentially a different political goal to the revolutionary one of liberation from below.

In the present epoch this socialism from above approach becomes reforms from above. This is at best the amelioration of the wage- capital relationship, not its overthrow. It presupposes and accepts the supremacy of the wage slave system, not its abolition.

At worst the Labor Party is a cover for pro-boss 'reforms' to better allow the exploitation of the working class.

The history of reformism in Australia supports this conclusion. The Labor Party, born of the defeats of strike action in the 1890s, substitutes a vote every three years for action to defend class interests.

In my view it is impossible to clean out the Aegean stables of capitalism by becoming its agent in its Parliament.

To take a living example, the Iranian revolution against the Ahmadinejad dictatorship appears to be pausing precisely because there is no revolutionary organisation with real influence in the Iranian working class able to put forward and lead the class conscious workers there in an appropriate direction with the aim of overthrowing the capitalist system and its Islamist overlay.

To end exploitation, to end oppression, the working class must first win the battle of democracy. It can only do that through its own organisation.

In the here and now reformism actually provides a cover for parliamentary cretinism to attack workers.

It disarms the working class and others who want to fight against Labor's attacks with a song that essentially promises workers pie in the sky when they vote.

As Labor's support for the Afghan war, the racist state of Israel, the Northern Territory intervention, cutting wages, the Australian Building and Construction Commission through its Workchoices Lite all show , reformism is, like religion, the opiate of the masses, the sigh of the oppressed.

Imagine if the thousands of members of Labor's left were to join with those campaigning on the streets and in the workplaces for real social change.

Instead of endless fights against the right and useless motions at Branch Conference, these thousands could join with us and others to mobilise tens or even hundreds of thousands in a real struggle against the reactionary ALP and create the conditions for strike action to defend working class interests and perhaps lead to the refounding of a militant section in the trade unions.

It will not happen because reformism's historic role is to destroy the possibility of any movement from below.

It fears the power of the working class as much as the reactionaries and will join with them in repressing workers when the struggle is really joined.

Me? I'll keep plugging away, attending demonstrations, selling Socialist Alternative, going to weekly Socialist Alternative meetings to help better educate myself about major issues, blogging on my site, arguing in my workplace for people to join the union and for the union to take action to defend jobs, wages and conditions and in these ways to help build Socialist Alternative into the revolutionary party Australia lacks at the moment.

Wednesday, June 24, 2009

Revolutionary Reformism

nb: immediately below this contribution of Lev's is another essay by Wes Bishop. Wes considers the question of reform or revolution from a liberal perspective. It's well worth the read.

Introduction to the problem

The debate of revolutionary or reformist approaches to social change have been argued through the ages and has become most pertinent since the bourgeoise revolutions and in particular with the development of democratic reforms during the latter half of the nineteenth and the first half of the twentieth century. The debate certainly gained prominence with the the unification of the revolutionary Social Democratic Workers' Party of Germany, led by Bebel and Liebknecht, and the reformist General German Workers' Association originally established by Lassalle. One of Marx's greatest works, Critique of the Gotha Programme (1875), in which he firmly established his 'third phase' (libertarian socialist) thinking, is a response to that unification. In the turn of the twentieth century the debate continued on one side of Eduard Bernstein's Evolutionary Socialism (1899) and Rosa Luxembourg's critique, the equally bluntly titled Reform or Revolution (1900).

To give a very simple summary, the revolutionary perspective argued that socialism can only be won through the forced overthrow of the ruling class, whereas the reformist perspective argues that socialism can develop over time with the gradual institutionalisation of more democratic rights. Related topics include political disposition of varying degrees of conservatism versus radicalism; debates over the psychological effects of State institutions, from insidiously corrupting to subtly influential; of political realism between principles and pragmatism; of class relations, conflict and the capacity of different classes to implement social change; in political organisation, between vanguard elites versus mass parties, and, on the highest level, the debate over the foundations of society itself whether natural, technological, institutional, relations, or ideas.

Of course, there is no suggestion that the following is anything but a brief sketch to the problem, a somewhat frustrated expression of personal experiences in both reformist and revolutionary politics, a discussion of the purpose of a revolutionary approach, and a conclusion that hopes to transcend some of the common problems through 'revolutionary reformism'. The notion of transcending, or overcoming, or even better still to use Hegel's phrase from the dialectical method Aufhebung is quite deliberate, in contrast to the erroneous assertion of a 'synthesis' through partial adaption of the thesis and antithesis. As much as Trotsky argued against "No common platform with the Social Democracy, or with the leaders of the German trade unions, no common publications, banners, placards!" from a revolutionary perspective he was also prepared to argue in favour of co-ordinated action "March separately, but strike together! Agree only how to strike, whom to strike, and when to strike!" ("For a Workers' United Front Against Fascism", 1931).

In decades of political involvement I am yet to see Trotsky's dictum seriously taken up by self-proclaimed revolutionary organisations in advanced capitalist states. Determined not to dirty their hands with actual governance, they are hopelessly split on relatively minimal differences and prone towards infiltrating social movements for the purpose of recruitment, rather than social change itself. The revolutionary assertions bring no comfort either; political programmes which are ill-considered and idealistic. By the same token, equal condemnation but of a different sort, can be levelled at reformist organisations. Highly institutionalised, they typically avoid involvement in extraparliamentary activism to engage in the byzantine labyrinth of State power for minimal and specific changes rather than seeking the systematic basis for the problems to begin with; as Henry David Thoreau remarked in Walden (1854): "There are a thousand hacking at the branches of evil to one who is striking at the root".

Revolution for What?

For all the discussion involved in the debate of revolution or reform, rarely is the meaning of revolution, the purpose of revolution, or the the causes of successful revolutions addressed. An exception to this is Hannah Arendt, whose classic study On Revolution (1963) is required reading. We understand, of course, the term revolution from its origins in astronomy but often the metaphor of a cyclical returning is avoided. This should not be the case, for the purpose of the cycle is a returning to fundamental values, the "organising principles of society" (to use Jurgen Habermas' term from Legitimation Crisis, 1973). Correctly identifying what these organising principles are should determine if change is essential and therefore determine, likewise, whether revolution is a necessity.

The usual Marxist-inspired evaluation of this question is that our society is a capitalist one, where the means of production are held in private hands and that this is the foundation of everything else that follows. Marx's famous distinction between the social relations of the economic base and the legal and political infrastructure (c.f., Contribution to A Critique of Political Economy, 1859) is the foundation of such an analysis. The argument is that regardless of varying degrees of liberalism in a society and modest victories by reformists, it is still fundamentally a capitalist one, which ultimately must be overthrown by revolution. Despite its merits and insights, there is fundamental problems with this analysis. The "economic base" is a conflation between the social relations of natural resources and those of human labour; an error in differentiating between the two results in a confusion of economic classes and, as a result, political economy.

This is no superior source to understanding political economy of course, than the classical school of economics who dedicated significant time to the question. The debate which ran from the French physiocrat Turgot, to Adam Smith and finally to Henry George was ultimately unambiguous; that individuals can belong to multiple economic classes that are workers, capitalist and landlord, their contribution to production is labour, capital and land, their receipt is wages, profit and rent. Moral justification was sought - and found - in the return to wages and profit, but not in the case of rent. Yet the conflation of land and capital into a single unit of analysis by both vulgar Marxists and the equally vulgar neoclassical economists blunted this insight in favour of revolution and war that dominated the first half of the twentieth century.

Ultimately, "social relations" are political rather economic. Economic systems rise from political systems rather than the other way around. In this sense, the liberal-bourgeois revolutions of the eighteenth century, specifically the French and American, provide insight to this question by looking at their results. Even considering the particular objective circumstances (the French republic surrounded by enemies, the American with but a modicum of local opposition), the relative success and failure of the two can be assessed in terms of their approach to liberty and the way they sought to establish a new society. In general, the more successful elements where those which ultimately provided the greatest respect to "negative freedom" and left firm foundations for the individual to engage in their own "pursuit of happiness" - such deliberate limitations on government and opportunity set as constitutio libertatis providing a novus ordo saeclorum (these being chapter headings from Arendt). Without this orientation, revolutions that impose a supposed 'general will' of society onto others by an elite inevitably end in disaster; "Thinkers prepare the revolution; bandits carry it out." (Mariano Azuela, The Flies, 1918). Unless the State, as Lenin pointed out in his 'almost anarchist' text State and Revolution (1917), begins to wither away from day one with its machinery smashed, the old diseases of control and authoritarianism will arise again (an unfortunate prediction with the Soviet Union).

Although those on the political left are often loathe to admit it, the most successful revolution of modernity has been that of the United States. When neo-conservative forces attempt to impose their will on the populous, they find that the constitution stands in their way. Sometimes they do have victories - such as the subversion of the Second Amendment, which was designed to minimise the influence of a standing army and imperialist wars. Often they must dig in their heels and make clearly ridiculous interpretations, such as the application of obscenity laws as a 'public health' issue over the First Amendment and, even more so, the Dredd Scott case where the courts determined - at least for a while, as it helped lead to the U.S. Civil War - that the Founding Fathers could not have possibly meant negroes were to be included in the opening of the Declaration of Independence ("We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty, and the Pursuit of Happiness."). Undoubtedly one day there very well might be a U.S. government that so ignores the constitutional rights of the people that violent action may be needed to remove such an administration from office; but even the possibility of such an event does not deny the strength of the lasting institution of a constitution founded on the principle of liberty.

Liberty and Commonwealth

The purpose of political action is freedom, whether that is in the negative sense, reducing the ability of the State to interfere in the free and consensual relations of autonomous citizens, or in the positive sense, whereby the government provides freely available enabling infrastructure, both social and physical, to its citizenry. As fiscal policy, provision of the latter does not necessarily require the reduction of the former, although it is certainly the case at the moment. The abolition of the landlord class, and the socialisation of resource rents at a freely-determined market value can certainly provide positive freedom without the current (effective) corvée labour of workers and investor to the coffers of the State. It also provides the most workable incentive structures to ensure environmental sustainability.

Likewise, the purpose of all political organisations is to create the conditions where they are no longer needed. Justified cynicism may be given to Pitt The Younger's remark that one day parliament would complete all the laws necessary and thus dissolve itself, but as a task for political radicals the spirit of this intent is requisite, as the strength of liberty depends on the involvement of the public. 'Vanguardism' by a cadre elite, is insufficient to guarantee that a revolutionary spirit is not hijacked by authoritarian opportunists, regardless of perceived advantages in a division of labour. It is not therefore "the Party" that should seek to achieve power on behalf of the masses, but rather such political parties should be engaging in a constant campaign that they masses become their own vanguard, led by their own "organic intellectuals", to use Gramsci's phrase. Ideally, the Party should cease to exist after a revolution; if it has fulfilled its revolutionary potential, the people will know how to manage their own affairs.

In conclusion, with a interesting management and economics intepretation, Mario Ferrero's recent essay Revolution or Reform? Socialism's Dilemma as Rational Choice Problem (in the journal Homo Oeconomicus, 2004) is worthy of reference. It argues that the revolutionary party is a producer cooperative that requiress a parallel commercial reform sector to provide worker incentives and consumer trust. Success in the reform sector, along with a sorely lacking proper use of public democratic institutions (Georg Lukács's The Question of Parliamentarianism, 1919 is critical reasoning in this regard) creates loyalty and attachment to those more radical proposals not yet implemented. In a liberal-democratic state (and not dictatorships which do require revolutions), with their supposed organising principle based on personal freedom and social democracy, there is far greater opportunity for extending these principles to their logical conclusion.

Reform, Revolution, and Reflection

Below is a left-liberal critique from Wes Bishop on the theme of "reform versus revolution". Later tonight Lev Lafayette will be posting a radical/socialist response to that same theme. John Passant has also indicated an interest in replying by the end of the week. Please visit regularly to follow the debate... All readers on the broad left are welcome to contribute to the debate...

Recently Tristan e-mailed me with the request of taking part in a debate about the legitimacy of socialism and whether or not as a stated goal it should be achieved through the avenues of reform or the raging straits of revolution. Upon approaching the answering of this interrogative I came to several conclusions quite quickly, a process that is indispensable for a commentator. The first conclusion I drew was that I am not a socialist. Therefore, to answer the question of how best to achieve socialism is akin to asking the King of Saudi Arabia the best pathway to western style democracy. This first conclusion left me at somewhat of a loss of words, because how can an American capitalist be trusted with the answering of such a question?

As is typical with myself I put the dilemma on the backburner of my mind and let it ferment for a few days before returning. I was not disappointed. Returning to the question I remembered one of the wise lessons my former professor, Dr. Ralph Carbone, had taught me year ago. For two years I had the benefit of learning from this master of rhetoric (i.e. person who LOVED to argue). In his classes he had a fascinating way of educating people about an issue. Walking into the classroom he would announce loudly, “This side of the room your pro-[this], this side your pro-[that]!” It wouldn’t matter what subject, evolution, abortion, immigration, the nature of beauty, all of that was reduced to what side of the room you were sitting in at the time of his announcement. Quickly, people would scramble to get to the side of the room they most strongly agreed with and then the debate would be ready to begin. On several occasions I purposefully sat on the other side of the room, than that of the one I agreed with, because as I found out I could learn much more about an issue (and subsequently myself) by arguing a point I did not agree with. Time and again I would spend entire class sessions, passionately defending intelligent design (that was a treat) or the right of the state to regulate what women can do with their bodies. What astounded me the most was not the fact that I could effectively defend a view point I disagreed with but that movements and philosophies that I found and still find completely incompetent could have valid objections. This realization hit me full force when Dr. Carbone and I began going back and forth over the issue of evolution vs. intelligent design. Typically Dr. Carbone would raise a point, I would counter it, and then he would come back with another counterpoint that shut my argument down. Yet, on this occasion after Dr. Carbone had countered, I came back with another whole new point and effectively refuted his argument. Silence fell over the room as everyone turned to look at me, and Dr. Carbone contemplated for a moment, finally resorting to a fancy two step to avoid the point. I sat stunned with what I had just accomplished; I an upstart sophomore from south eastern Ohio had just shut down a fully fledged Ph.D.

The point of my inclusion of this trip down memory lane in this essay is this, although I do not agree with socialism attempting to argue its case (and how to achieve it in a society) taught me much about the movement and led me to an inevitable conclusion in answering the question, REFORM or REVOLUTION?

Put simply, revolution is not the answer, and reform is the path that should always be attempted, tirelessly and diligently. Now as an engaged reader the question naturally follows as to why this is the case? Why reform? Why not revolution? Is it not hypocritical for an American to condemn revolution, when the country all Americans belong too was born in the throes of revolt?

Again to answer it simply, no it is not hypocritical, and reform is the better path for many different reasons. First off it is not hypocritical because what the American founding fathers engaged in was a risky gambit that could have easily backfired and caused severe repercussions for generations and generations. Yet, the founding fathers were lucky, and more importantly pushed by the British to the point that revolution was the most viable solution for their people. In such a case revolution, unfortunately, was warranted, but as any quick survey of history will reveal, revolutions seldom end as well as America’s, with massive social upheavals and economic disparity being the norm instead of the exception.

Socialist that seek to enact their policies should remember this, as it is overly apparent in the western democracies that civic pathways are open to change. Granted this change can sometimes be frustratingly slow, but reform allows for something that revolution very seldom does. And that factor is the beneficial practice of clear reflection.

As the above story illustrates reflection allows for people to contemplate their situation, and their goals, learning about themselves and what they believe. Reform will allow for the enactors of policies to re-evaluate the course they have chosen, modifying it when necessary, and abandoning it when it is no longer fruitful. The members of my class that rushed quickly to their desired side of the classroom behaved much like revolutionaries. So sure where they of their paths that they felt that no further reflection was needed, no more contemplation warranted. A side was chosen, and that side was now to be defended until the end. Such is the case of revolution, for both parties involved.

For the actual merits of socialism, I will conclude with these parting thoughts-

Inside the United States today there is growing pressure to view our economic system (and the economic systems of the world) in a black and white fashion. This new dogma (or not so new dogma) reduces the world into the inaccurate description of pure capitalism, and pure socialism. In many ways this movement is a precursor to the revolutionary mentality, which pits one faction against another. Automatically, the culture of today is slapping labels on people and telling them, “Look, that person is the enemy, we need to oppose them.”

I speak on behalf of all common sense in America when I put forth the following claim, economics should never be a battleground of ideology, or politics. It should always be an objective approach to what is best for the people of a nation. There will be differences in opinion. There always are, but pretending that the States are teetering on the edge of Socialistic revolution is the same as believing that the U.S. is going to become an Islamic theocracy. Thankfully, many in my country have heeded the lesson of reform and have followed it.

Unfortunately, there are the red herring trumpeters who say Obama will make us socialist, because of the recent response to the economic crisis. However, let one thing be clear, although there is a lot of resentment in the U.S. for “socialism” in the financial and auto industries it should be remembered that the free markets asked for this government assistance. Washington did not storm the lobbies of Detroit and Wall Street; the free market came to the halls of Capital Hill seeking government aid and intervention. Socialism has won an important victory through patient reform on this occurrence because it is vindicated in the conviction that markets are incapable of regulating themselves, and that governments have a fundamental right to protect their citizenry. This tip of the hat to socialism would render from my fellow capitalist a quick condemnation that includes some benign comparison to Stalin. To this I say the following, criticizing socialism because of Stalin is paramount to denouncing democracy because of Iraq.

I stand after all of this an even more radical moderate in my economic philosophy. Although a capitalist, I am quick to denounce the drastic ramblings of Ayn Rand and state that to the contrary of what Objectivist teach, mixed economies are a sign of a viable nation and responsible government.

I have reached these conclusions through reflection, which has been permitted because reform has ruled over revolution. If a young writer can benefit from this practice both now, and as a sophomore years ago, imagine what a world full of individuals could gain from the same feat.

-Wes Bishop

Sunday, June 21, 2009

Debt for Development Makes Sense say 21 Prominent Australian Economists


above: Prominent Australian economist, John Quiggin - one signatory to the statement below
Dear readers: we are reproducing this from the Australian Financial Review. It is critical in that it refutes - with authority - the hysteria and panic whipped up by the Conservatives over the Australian government's deficit expenditure. You are all welcome to discuss.
Nb: Later this week we will initiate an exchange regarding the old theme: 'Reform or Revolution'. We already have a couple of contributions ready to go - and we expect to have another couple by the end of the week.

Australian Financial Review, 3 June 2009

In Paul Krugman’s words, right now, “knowledge is our only defence against catastrophe”. A natural reaction would be to retreat into timidity. But that would repeat mistakes that exacerbated the Great Depression by giving in to our fears and phobias. IMF Chief Economist Olivier Blanchard has a similarly blunt message. “Above all, adopt clear policies and act decisively. Do too much rather than too little.”

Of course other things being equal it’s better for governments to be debt free. But as any homebuyer knows, debt can help us build assets now that we couldn’t otherwise afford, and repay the costs when the assets bear fruit. Australia entered this crisis relatively well placed to weather the storm. In addition to the recent mineral boom, for twenty five years Australian governments have consistently stressed fiscal responsibility and taken large political risks doing what they thought right for Australia, for instance with tax reform and fiscal austerity during the mid 1980s and again in the mid to late 1990s.

Many developed countries were already running cash deficits and had substantial public debt before the financial crisis. However all of them have accepted one lesson of the Great Depression – that during a downturn we should let the ‘automatic stabilisers’ work by loosening budgets temporarily as revenue falls and outlays on welfare relief increase.

Given Australia’s relatively stronger balance sheet, it’s been in a better position to engineer additional discretionary fiscal stimulus than most comparable countries. Cash handouts of nearly two percent of GDP are being paid to middle and lower income Australians. There is no more effective way to stimulate the economy quickly. The success of this measure can be seen in the relative strength of Australian retail sales compared with almost any of our peers. In addition the Government plans to spend many billions more on infrastructure.

All this has converted a sizable expected cash surplus next financial year into a deficit of nearly 5 percent of GDP. This compares with the average of our peers of nearly 9 percent. On current Treasury projections, which seem as plausible as any (though like all such forecasts, they are only ‘best guesses’), net debt will stay below 14 percent of GDP compared with an average of over five times this in comparable countries which nevertheless retain their creditworthiness in capital markets. Ultimately if other countries run weaker balance sheets than us, that’s no reason to relax our own standards. But the comparison does provide some context. It illustrates that even after the stimulus, we remain within a very healthy margin of safety in our Government’s reputation for economic prudence.

None of this is to suggest that Australia should rest on its laurels. There’s a fair chance (but no more than that) that our economy will recover strongly within two years. But just as we don’t know today how far or fast interest rates should be increased then, we don’t know today precisely how fast we should be returning towards budget surplus then. So these debates need to go on and there will come a time when we need to change direction, from supporting economic growth to restraining it, perhaps with great vigour. But that time is certainly not now.

Further, as Australia’s population and infrastructure needs grow, Australians must decide whether they prefer a balance sheet more suited to genteel decline or one that supports investment, dynamism and growth. In addition to building genuinely valuable assets in R&D and carbon abatement, our education, health and transport systems and housing stock, the stimulus will, in Treasury’s words keep up to 210,000 Australians in work who would otherwise be out of jobs. Major infrastructure projects should also pass independent and transparent benefit/cost assessment.

Deploying our strong balance sheet to use otherwise idle resources – or to put it more compellingly, deserted factories and unemployed workers – to build assets that improve our lives and our economy in the future, seems much more appealing; much more commonsensical than retreating into phobias.

Fred Argy, Former Head of EPAC.

Paul Binsted, Company Director and Economist

Tony Cole, Former Secretary to the Treasury

Max Corden, Emeritus Professor, Johns Hopkins University

Owen Covick, Associate Professor, Flinders University

Steve Dowrick, Professor of Economics, ANU

Saul Eslake, Chief Economist, ANZ Bank

John Foster, Professor of Economics, University of Queensland

Bernie Fraser, Former Governor of the Reserve Bank of Australia and Secretary to the Treasury

John Freebairn, Professor of Economics, University of Melbourne

Joshua Gans, Professor of Economics, Melbourne University

Paul J. Gollan, Associate Professor, Macquarie University

Roy Green, Professor, Dean, Faculty of Business, University of Technology, Sydney

Stephen Grenville, Former Deputy Governor, Reserve Bank of Australia

Nicholas Gruen, CEO, Lateral Economics

Tony Harris, Former Auditor General of NSW

Stephen Koukoulas, Global Strategist, TD Securities

Andrew Leigh, Professor of Economics, ANU

John Quiggin, Professor and ARC Federation Fellow, University of Qld

Mike Waller, Former Chief Economist, BHP Billiton

Glenn Withers, Adjunct Professor, Australian National University

Wednesday, June 17, 2009

Banks raise fees – Arguments for social banking

In Australia the Commonwealth Bank has raised its home loan interest rates 0.1 percent. At the time of writing, Westpac and the National Australia Bank have ‘followed suit’, raising rates on their fixed interest rate home loans.

As John Passant has noted in ‘En Passant’: it is hardly as if the banks were ‘strapped for cash’. Passant notes:

“In the first half of this financial year [the Commonwealth Bank] made $2.5 bn profit (an increase of 9 percent over the previous comparison period).”

Furthermore: earlier this year [a report from] Fujistu Consulting…found [that] Australian bank fees were 22 per cent higher than those in Britain and 11 per cent more than US banks.

Of course, though, it didn’t have to be this way.

It was the Keating Labor Government which moved to privatise the Commonwealth Bank. In this process, the acquisition of the State Bank of Victoria was used as a ‘Trojan Horse’ for Keating’s neo-liberal privatisation agenda.

The course of full privatisation took place between 1991 and 1996 – and the Australian banking sector has never been the same since.

More recently – in response to the ‘credit crunch’ – and out of dire necessity - Rudd Labor has garaunteed “$600-$700 billion deposits in Australian financial institutions. This was in order ”to shore up local confidence and protect the nation's international competitiveness.”

An unintended consequence, though, has been the marginalisation of independent lenders: to the expense of local competition. Australia’s four major private banks – the ‘four pillars’ – have consolidated their position thoroughly. There are conflicting arguments, here, about the significance of competition.

In a personal exchange with the author, prominent Australian economist Steve Keen has noted that:

"a non-profit-oriented [Commonwealth Bank] would not have been driven by competition to achieve market share into dropping its lending standards. The impact of competition was really to drop prudential standards in order to get the largest share possible of the mortgage market. What can arguably lead to efficiency in a product market leads to lemon lending in a financial one."

Steve Keen believes it to be a “moot point”: but the following can be argued:

If Labor was serious about competition in the banking sector, the wholesale privatisation of public banks would never have taken place. The place of a re-socialised CBA in offsetting potential collusion, and maximising product competition - could be critical.

On the other hand, as Keen has pointed out: competition for financial services can lead to a deterioration of lending standards.

Strong prudential supervision is required to resolve this problem. But also: if vulnerable Australians are therefore ‘shut out’ of the home loan market, government (both State and Federal) needs to take immediate and strong action to build up quality public housing stock. As well as providing directly for vulnerable Australians, by increasing supply downwards pressure could also be applied on housing rental rates.

A tightened rental market in Australia has arisen as a critical problem since the Howard conservative government irresponsibly fostered a housing bubble as an artificial means of buoying economic growth.

Continuing in his critique of competition in the financial services sector, Keen argues that

“competition has led to a compression in the loan/deposit rates, but [also, as a consequence] a growth in fees to gouge existing customers. If we hadn't had this competitive orgy, the loan/deposit gap might have remained larger than today, but consequently the need to gouge customers with fees to compensate wouldn't have been there.”

The logic of Keen’s arguments tends to suggest the desirability of sweeping bank nationalisation. But while this is still theoretically defensible – even preferable - the constitutional barriers to such reform in Australia are set.

Keen may be correct – that competition in itself can have undesirable consequences. But given the current impossibility of across-the-board bank nationalisation: the presence of a public bank could provide competition of a more benign form.

The best short-medium term course of action, therefore, is the re-establishment of a public sector bank – which because of its not-for-profit footing swiftly secures a strong foothold in the market. By doing so, even now Australian Labor could potentially make amends for its past errors: following the example of New Zealand Labor.

The benefits of re-establishing of major public sector bank are manyfold.

A resocialised Commonwealth Bank could move to a ‘not for profit’ footing. Low income earners could be provided with ‘no fee’ accounts. Billions in profits could be directed into abolishing fees; and not moving to repossess houses where families are left vulnerable because of the recession. And equal services could be provided for disadvantaged Australians – including provision of services in rural and regional Australia.

Alternatively, even were such a bank to maintain a ‘profit-footing’, at the least such dividends could be ploughed bank into crucial welfare and public services.

As the recession bites, progressive ideas are needed now more than ever. Hopefully these kind of arguments will gain exposure in the public sphere. Despite the prevailing neo-liberal ideology, there is a sense that the ‘tide could be turning’. The task of building a ‘democratic mixed economy’ is before us. Let us pursue this task with hope and determination.

Tristan Ewins, June 2009-06-17

The author would like to thank Steve Keen for his advice in research for this article.

Friday, June 12, 2009

Labor's Georgist History

Origins and Early Days of the ALP

The last decades the nineteenth century was a turning point for the Australian labour movement. The preceeding twenty-five years to the crash of 1890 and the subsequent "bitter fight" had been one of relative prosperity for Australian workers with an expansion in capital investment. Trades Councils were formed through most of the colonies in the 1880s with Intercolonial Trade Union Congresses held in Sydney, Melbourne, Adeliade, Hobart and Brisbane. There was a strong move towards a federation of union bodies, and historians note the influence among the working class of books such as Bellamy's "Looking Backward", Gronlund's "Co-operative Commonwealth" and Henry George's "Progress and Poverty".

It is from the latter that this essay is based; for most who have even a modicum of knowledge of Australian labour history, the distatesful racism that permeated working-class organisations at the time is well known. Consider the following motion put by one Mr. H. Barnett of the Bootmaker's Union of South Australia at the 4th Intercolonial Trade Union Congress in Adelaide in September 1886:

"That in the opinion of this Congress the time has arrived when immediate steps should be taken about the total abolition of Chinese and Coolie immigration because - first, the competition of Asiatic against European labour is entirely unfair; second it is well known that the presence of Chinese in large numbers in any community has a very bad moral tendency"

The fact that this motion was carried unanimously at that Congress should serve as indication as the strength of opinion towards "non-White" labour. It served as the first item in the "fighting" and "general" platform of the Australian Labor Party in 1902, and was repeated in the 1905 platform, through to the 1919 platform, the 1921 platform (where the "socialisation of industry, production, distribution and exchange" was adopted) and so on, well into the 1940s and beyond. As immigration minister, Arthur Calwell remarked in 1949: "We can have a white Australia, we can have a black Australia, but a mongrel Australia is impossible".

At the same time however, there is a less well-known history, one that is far more noble. Returning once again to the 4th Intercolonial Trade Union Congress of 1886 we find that there was another motion that was passed unanimously, this time moved by Mr. A.G. Vagg of the Progressive Society of Carpenters and Joiners, Brisbane:

"That it is the opinion of this Congress that a simple yet sovereign remedy which will raise wages, increase and give reminerative employment, abolish poverty, extirpate pauperism, lessen crime, elevate moral tastes and intelligence, purify government and carry civilisation to yet nobler height, is to abolish all taxation save that on land values".

The socialisation of land values was supported by a variety of different organisations in different degrees; the Land Nationalisation Society of the late nineteenth century and the Single Tax League being two obvious supporters. As a means to more progressive changes, the Knights of Labour also gave their support. When the Australian Labor Party was established these values first saw their expression in item four of the "fighting" and "general" 1902 platform with support for the nationalisation of monopolies. In the 1905 platform this was separated into support for nationalisation of monopolies as the second item and a progressive taxation on unimproved land values as the fifth item; notably this was the only element of the platform at the time which indicated support for any sort of taxation - interstate tariffs were to be determined by referendum.

In 1910 the Fisher Labor government introduced a Commonwealth Land Tax. In the words of the Australian Tax Office:

"In 1910 a land tax was introduced by the Commonwealth Government to provide for the defence of the nation and to prepare for a major increase in migration. The land tax was also introduced to encourage large landholders to subdivide their land and sell it to settlers. Many large landholders were wealthy Englishmen who would rarely visit or use their land. Introducing a land tax encouraged them to sell to settlers who would use the land productively."

In other words, the purpose of the land tax was precisely what Mr. A.G. Vagg had intended some twenty years prior; to end speculation, to break up the large holdings, to encourage productivity and therefore increase wages and so forth. The influence of this idea was widespread; even the opposition Liberal Party (as it was then called) lead by Alfred Deakin remarked, quite correctly:

"The whole of the people have the right to the ownership of land and the right to share in the value of land itself, though not to share in the fruits of land which properly belong to the individuals by whose labour they are produced."

Initially it was widely considered that this would be the only tax. Prior to that the Commonwealth gained finances through a customs and duties, which contradicted the political objective of free trade between the various states. For a few years it seemed that indeed this could indeed become the case, as the Fisher government successfully introducing a number of significant reforms such as the the first child maintenance scheme, the establishment of a Commonwealth bank and a Federal control of the money supply, and a citizen's militia.

However with the advent of World War I, the irrational loyalty to British imperialism over German imperialism led to excessive commitments. Now in opposition, Andrew Fisher infamously dedicated Australia to "the last man and the last schilling", a bill that would have to be paid in both money and blood - and eventually, with power as military adventurists in the Party caused a split over conscription.

To make up extra income, in 1915 Commonwealth introduced personal income tax and tax on company profits. The name of the Land Tax Office was changed to Taxation Office to reflect the wider sources of public revenue, which was followed with an "Entertainment Tax" in 1916 - which remained in force until 1953, and a War Tax on postage stamps, which remained in force even after the legislation was removed in 1920.

Forgotten Promises

Labor's opportunities to continue or expand this policy remained rare after the split during World War I; indeed there was no real opportunity at all. Conservative forced ruled throughout the second half of the 1910s, and throughout the 1920s. There was the brief Scullin government of 1929 suffered not only the effects of the Great Depression, but also the political fall-out which saw the Party split into three directions, with the entire New South Wales branch under the leadership of J.T. Lang being expelled, and the former Labor treasurer, Lyons, leading the conservative United Australia Party. Labor was in opposition for another ten years after that only again to regain power in the midst of the most terrible war the world has known. Again there was little opportunity to further something so supposedly prosiac as a land tax on site values.

Opportunity did exist after the war of course, and during that period the Labor government engaged in a series of substantial reforms; such as physical infrastructure investment such as the Snowy Mountain Scheme, social infrastructure investment such as the free medicine program, national unemployment and sickness benefit. Whilst the attempt to nationalise the banking monopoly - carried out after a Royal Commission determined that the private institutions did not engage in any serious competition - contributed significantly to the downfall of the Chifley govenment it is notable at no time did Labor even consider to remove its commitment to a Commonwealth taxation on unimproved land values.

As Labor lurched in crisis in the 1950s, the ever cunning Prime Minister Menzies took the opportunity to give the landlord class a free gift and remove land tax from a Federal to state jurisdictions where they could compete among themselves for the most appropriate rate - and thus also provide interstate landlords the ability to acquire multiple properties acorss different states each below the individual state threshold for taxable values. Arthur Calwell was provided the opportunity to respond to the Menzies' government decision in parliament and in his thirty minute speech he condemned the government, reasserted the right of the people to own the land and swore that Labor would return a Commonwealth Land Tax when elected.

"We of the Australian Labor Party have always believed that the land is the patrimony of the people and that nobody has a complete and absolute title to it. ...The land belongs to the people, and its use must be safeguarded and protected at all times... We have always believed in the land tax, and when happy days come again we shall restore the measure imposing the tax to the statute book of this country."

Devastatingly, it was the Labor Party itself which removed this commitment. In the 1961 Platform, whether by administrative incompetence or malice, the sixty-five year committment of the Australian Labor Party to a commonwealth land tax on site values was removed, without the deletion ever being taken to Conference for approval.

Some however were not so easily fooled. With the election of the Whitlam government in 1972 there was perhaps the first opportunity for decades for a Labor government to act without the pressures of an all-encompassing war, post-war reconstruction or economic depression. Clyde Cameron, Minister for Labor, raised in the very first pre-budget meaatings the need to introduce legislation to collect the economic rent of land instead of direct and indirect taxation on labour and capital. The following year he wrote to Frank Crean, then Treasurer, again for the introduction of Calwell's promise and a Labor platform item that had never been defeated on Conference floor. It was, of course, conviently forgotten with the the crisis of the Whitlam government in 1975.

With the election of the Hawke government in 1982 the opportunity once again arose to lift the tax burden from productive labour and capital and shift it on the use of resource holdings. Of course, Cameron had long since retired and there were no strong advocates in the parliamentary party who could advocate such a position. Economic problems causes by monopolistic acquisition of resources don't go away however and the Hawke government introduced a Capital Gains Tax which at least partially mitigated against the most obvious rent-seeking incentives. It was strongly opposed, of course, by the conservatives at the time, but not reversed when the Howard government came to power. Indeed the former Prime Miniser once wrote: "I do not deny that all taxes, with the exception of those on economic rent and inherited wealth, have some [adverse] employment and economic growth effects."

Of course, a capital gains tax is a far cry from a site rental. Land is a different factor of production to capital, despite the attempt of vulgar neo-classical economists and equally vulgar Marxists to conflate the two. Stocks and bonds, collectible artworks and antiques are not the same as natural resources. Not surprisingly, capital gains tax also comes with a deadweight loss insofar it restricts trades (a "lose-lose" situation), and increasingly comes with significantly administrative losses as well with a collection of some 52 Capital Gains Tax "events", a slate of exemptions and semi-exemptions, and variations in calculating the amount owed.

Practical Effects

There are real and practical effects to creating an incentives to acquire natural resources both in a fiscal sense and in a physical and social environmental sense. Neither of these can be said are particularly good for the Labor Party, let alone society as a whole. Regardless of tinkering and the piling of complexity (and transaction costs) a general principle can be stated; if you tax an item, you create a disincentive for it to be produced or acquired. Thus, if the relative taxation of natural resources is low compared to labour and capital, then there will be a tendency towards monopoly as (a) it is fixed in supply and (b) demand (or rather requirement) is relatively inelastic. This itself contributes significantly to a boom-bust cycle, as investment is encouraged in areas which do not result in the provision of goods and services, leading to a crash in real estate prices, which is gradually rebuilt.

On a fiscal level, if production is distributed between rent, interest and wages (P = R + W + I) then wages and interest must suffer in proportion as rent increases. This relative impoverishment creates a public demand for government intervention to assist those at risk, but when the private expropriation of resource rents has already been accepted politically, taxation on wages and interest are required, which further suppresses economic activity due to deadweight losses in trades and compliance costs. According to the Land Values Research Group, since 1972 the total loss to the economy as a whole since 1972 has been $1 trillion further "[u]nder existing taxation arrangements, labour and capital fight over the 40% of GDP remaining from earned incomes after 28% of GDP has been taken from them by taxation and after 27% of the 32% of GDP comprising publicly generated resource rents has been creamed off by private interests."

These destructive fiscal effects have a very real effect on Australian demographic culture. The quest for economic land, or location, drives up land prices and reducing housing affordability. Working people then retreat to the suburban fringe, places which are notorious for their lack of community and physical infrastructure. In splendid isolation an "us and them" fortress mentality becomes a norm which was most clearly displayed in the 2001 "Tampa" election. Labor's surprising loss is indisputably a result of swings against the party in the working-class suburban fringe, which was most prone to racist fearmongering.

There are two schools of thought about what Labor should do about this. One argues Labor must adapt to these circumstances and engage in populist condemnation of asylum seekers, downplay commitments to multiculturalism, the environment and so forth and, in general, encourage and seek "aspirational voters" - whose aspiration is private wealth and public poverty. The other body of opinion argues that Labor should seek to change those conditions as they are destructive to both the party and to the country. Trivial economic analysis over the past elections shows that Labor's vote has been increasing where there is existing social infrastructure and a relatively higher population density.

But will the Australian Labor Party do this? Will they create the right incentives to encourage cities to become more compact, with high quality buildings and a high density of physical infrastruture, all of which help develop a civic consciousness? Will Labor offer a massive shift of the public tax burden away from the working class and on to the landlord class? Will Labor ever re-instate its sixty year policy of a commonwealth land tax on unimproved site values, so that those who hold a resource must pay the community the privilege of that exclusion?

Sadly, I believe it may be some time before this occurs. As the famous American civil libertarian and rights lawyer Clarence Darrow wryly remarked:

"The single tax is so simple, so fundamental, and so easy to carry into effect that I have no doubt that it will be about the last land reform the world will ever get."

Thursday, June 11, 2009

Some thoughts on social transformation

Below are some excerpts from a debate I’ve had at John Passant’s ‘En Passant’ blog…  We’ve been considering holding an exchange on the old debate “Reform versus Revolution”  The material is not a well-planned essay – but hopefully the points we make will spur debate.

Sincerely, Tristan

Liberal consensus, the power of wealth, counter-hegemony and strategic compromise…

In the course of struggling for change liberal consensus gives us some room to move… Participatory and democratic media are also important. In the future, possibilities will arise through revolutionised communications technology   But even despite this - the power of concentrated wealth is appalling.


What bothers me, though, is that some people internalise the ‘wisdom’ that radical reform must lead to disaster - as a consequence of retaliation by wealth - and the servants of wealth in various national governments.  The problem is that people can accept this – without questioning the legitimacy of the broader social and economic system…  This should appal every liberal and democratic bone in our bodies!!!


Swedish style social democratic corporatist compromise is not my "perfect and final ideal".  Ultimately, I hope for a more expansive program of economic democracy than has been sustained even there…  But to build an alternative based on the Swedish welfare state would compromise a victory of epic proportions!!!  Still - the struggle for justice is a long and difficult task. It is a task through which we must confront ingrained elements of conservatism deep within the working class itself. And aside from that we face a cultural sphere deeply influenced by Ideology...

Outwardly there is liberty... But with the domination of the cultural sphere by wealth - as Chomsky says - there is a manufacturing [of] consent...

The point here is that we face what Gramsci would call a long "war of position" - a cultural war for the hearts and minds of the working class; of all oppressed groups; and of all those moved to stand for justice...

In this struggle, though, there are 'peaks' and 'troughs'... And even were a majority of workers and citizens to realise the case for change: even then progressive forces may not be in a position to implement a socialist program...   

By ‘socialist program’, it is important to note that I do not refer to the authoritarian command economies of the former USSR and Eastern Bloc…  Rather I work for a liberal democratic socialism: based of a democratic mixed economy; with strategic natural monopoly, and democratic yet competitive markets.   This would include Government Business Enterprises, mutual societies and co-operatives, collective capital formation (eg: pension or wage earner funds) and social infrastructure.

In the process of working for such a program, though, we would deal not only with the resistance of the local bourgeoisie - but of world capitalism... Isolation can swiftly degenerate into Stalinism - and is not preferable...


Also of note: It should not be underestimated - the dimensions of the task of building a constituency for socialism... Most are (understandably) deeply immersed in the present - in everyday life – and day to day issues: mortgages, groceries, working hours and wages - dominate peoples' consciousness...  Such everyday issues are critically important.  But to challenge the "Common sense" of capitalism requires a more long-term cultural struggle…

Anyway - this is a convoluted way of putting it - but the struggle we are talking about might be such as to span decades... In the meantime it is reasonable to suppose outbursts of struggle will be met with strategic compromise... The point is to be strong enough for such compromise to be agreed to on as favourable terms as possible.

Restoring the 'mixed economy' is a good place to start... And over the course of the years we ought also fight for democratisation – as suggested before, through co-operative enterprise, public infrastructure, Government Business Enterprise, collective capital formation and the like...   

Importantly: the so-called 'final objective' is not the 'be all and end all'.... Here and now we can fight for the needs of workers, oppressed minorities. We can demand the very liberties that go to the heart of the system's very legitimation...

Contesting the dominant ideology - which legitimises the rule of concentrated private wealth - is a long term project - a multi-faceted struggle of interlocking social movements... In this process - if there are outbursts of struggle - judgements will need to be made - re: support within the state apparatus; whether those within the apparatus of force and coercion intervene on one side of another, or allow the struggle to play its course...

And of course –again - there is the spectre of global retaliation if foreign interests are expropriated without what they deem to be acceptable reimbursement... And through all this, we cannot just 'project' our agendas onto the working class and social movements... It is reasonable to suppose social movements might support a radical compromise... but maybe not as absolute a transformation as some seek...

This all being the case there will need to be periodic compromise at intervals over the decades - through the course of progressive struggles... And in this we need to contend with power in its many varied forms... Like Billy Bragg says "You can borrow ideas but you can't borrow situations..."

Thursday, June 4, 2009

The New Red Scare

The red scare. Mere mention of the politically loaded phrase conjures up images of masses of people assembling with hyperbole pitchforks and parading “anti-American” individuals before a committee in the Senate or House of Representatives. Yet in fact, the term “Red Scare” historically can be ascribed to two different time periods in America’s history. The first lasting roughly from 1917 until 1920 and the second from the late 1940’s to the late 1950’s. The first red scare was a reaction to the overthrow of the Russian Czar and the Bolshevik Revolution that first brought Communism to power in Russia. It was a movement felt throughout the Western World and led to a further chilling of relations between the Western democracies and Russia, a relationship that before the revolution was shaky at best. The revolution effectively took Russia out of WWI, forcing the power to sign a peace treaty with Germany, and at its intellectual basis created a differing political movement that would run counter to the ideas of democratic capitalism in the west. 

The second red scare is somewhat more documented. With such figures as Senator Joseph McCarthy and the Hollywood blacklist, that created martyrs such as playwright Arthur Miller, it today serves as a warning of what hysteria can create in a country. 

The term red scare in effect refers to the fear that many in the western world had in regards to communism, the term red pertaining to the red flag of the Soviet Union. Even though the red scare for most purposes ended by the late 1950’s it continued well into the 1960’s and in some ways to present day politics. 

The conservative columnist Jonah Goldberg wrote a book in 2008 titled Liberal Fascism. The book mainly deals with criticizing then assumed nominee Hillary Clinton on her policies, but the main thesis of the book is that fascism is a word thrown about by the liberal movement in America and that in fact fascism comes from liberalism. The book was controversial, as it was meant to be, and in retrospect seems outdated for its continuous assault on Clinton. Yet the spirit of the thesis, that a word is thrown about without knowledge of its meaning, is one that I would now like to borrow from Mr. Goldberg to suit my own purpose here in this column.

Socialism, and communism are words that today are bantered about by the right wing of the GOP with as little regard as to what it applies to much like Goldberg’s alleged liberal fascist labelers. Tune into FOX or listen to any die hard of the Republican Party and you will quickly “learn” that Obama is a socialist. Nancy Pelosi is a Socialist. The Democratic Party is a communist party…etc. In all honesty this has nothing to do with policies but instead it is a word that inspires fear therefore it is used as a label for political purposes. 

Now the argument could be made that Obama is a socialist because he is using the government to help the financial and auto industries, and because he has approved a massive spending bill for the country. However if this is accurate then FDR was also a communist for it was he that used government intervention to help the country get out of economic turmoil, and the GOP has been trying nonstop for the past several years to make Iraq into a modern day socialist country with its continual use of government aid. 

Right wing advocates of the past administration also should have a difficult time explaining their stance on such controversial issues as warrantless wiretapping, torture, and suspension of habeas corpus for certain individuals. Because the interesting thing about this new red scare by the conservatives is that they claim Obama’s policies will limit citizens liberties. It is ironic that the GOP advocated so heavily for a suspension of those liberties but now criticizes the Obama Administration for its policies because it “may” lead to the very thing they wanted. In other words conservatives are saying that if Obama gets his way and is allowed to attempt to assist the country by building up infrastructure, investing in green technology, and putting money in the American economy then the American people someday will wake up under that dreaded red Soviet flag. This is opposed to the GOP which for the past few years stated that one should skip all of that above mentioned spending on the country and go straight to the dreaded flag.

Unlike Goldberg’s false premise that fascism came from liberalism, this columnist does not claim that conservatism came from communism. Yet certain factions in the right wing movement advocate very bizarre notions when it comes to their brand of liberty. The notion that Bush was correct in his expansion of power while Obama is incorrect for using the government to stabilize the economy. That the Democrats are communist while holding the conviction that if one does not belong to their political party they are un-American. Perhaps it is like my grandmother told me years ago, that if someone hates something long enough and hard enough they will eventually become what they hated. It is for this reason that the GOP has morphed into something that only a few decades ago they would have detested. Red scares, based on fear, leads to hate dear reader. Hate has no power other than that to destroy.

by Wes Bishop

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