Wasted Opportunity on Superannuation Concessions needs to be ‘Put Right’ at ALP National Conference in July!

Above: Where to for Labor in July?

Wasted Opportunity on Superannuation Concessions needs to be 'Put Right' at ALP National Conference in July!    Australia Institute data shows a stronger line on reform is needed.

Tristan Ewins

Recently Bill Shorten announced projected reform of superannuation concessions affecting around 180,000 Australians.  ‘The Age’ in particular observed that the two key reforms concerned

“would see retirees lose tax-free status on annual superannuation earnings above $75,000, and more people paying 30 per cent tax on contributions.”

Certainly Bill Shorten’s announcement is “a step in the right direction”, bringing in $14 billion over ten years. 

But it is a very  modest intake when considered in perspective.

The problem is that Shorten appears to be ruling out further action on top of this on superannuation concessions AHEAD of the ALP's 2015 July National Conference. 

And more alarmingly:  arguably $15 billion out of a total of $50 billion will soon be going to 'the top 10 per cent' income demographic. 

Former Australian Tax Office public servant, John Passant has explained that this means  “the top ten percent of income earners get 30% of the tax concessions on super.”  (discussion with John Passant, 22/4/15)

To get that in perspective, the Australia Institute observed in 2014 that: “The [entire] age pension currently costs [only] $39 billion”.

Is this really the best possible use of taxpayers’ money? Does it fulfil the ‘distributive justice’ test?  And given the scale of the gain to only the top 10 per cent income demographic is it even politically wise when we consider what else might be done with the money?

A more decisive policy here could fund a suite of progressive reforms: National Aged Care Insurance; NDIS and Gonski; build the National Broadband Network Fiber-To-The-Premises; Medicare Dental; address life expectancy crisis for indigenous and mentally ill; expand mental health services; crisis accommodation for cases of domestic violence; welfare reform; build transport infrastructure publicly; invest in public housing to put downwards pressure on property prices and rental costs...   Many of these policies have been suggested in the ‘For an Equal and Democratic Australia’ document which points the way to the kind of policy a reforming Labor government could potentially introduce.

Labor needs to think of policies in terms of tens of billions – not just ‘token policies’ which attempt to win over voters on APPEARANCES only. Further reform of Superannuation Concessions is ESSENTIAL. As is reform of the broader tax mix – ideally to bring in new revenue in the vicinity of $40-$50 billion. (about 2.5%-3% of GDP) (modest in the context of an economy valued at $1.6 Trillion)

Right now,  with the mining boom over – Labor is 'on track' to capitalize politically from the Abbott government’s austerity .  And yet Labor is also ‘on track’ to again introduce austerity of its own in government should it maintain its inflexible commitment in its National Platform to ‘small government’. (though probably less severe, and less cynically targeted - you would hope!)

Specifically the problem is Labor’s commitment to holding down tax as a proportion of GDP.

 Labor must  ‘think bigger’ (and better!) than this!!!

These issues MUST be addressed at Labor’s National Conference in July.

From conversations and research I have become aware that there are some within the Labor Party who are resigned to (or even in favour of) the National Conference being reduced to a merely token affair.  Shadow Treasurer Chris Bowen, for instance, is in favour of a more robust and inclusive discussion of policy at Conference; but on condition that Conference  (and the Platform itself) have no binding influence on policy. (Bowen,  pp 122-124)  In a conversation with one colleague  specifically (and probably there are more),  this colleague was resigned to the notion that Gonski and NDIS are ‘dead’  in their original form – presumably because they think the money cannot be sourced for reforms on a large scale. (the assumption seems that ‘small government’ cannot successfully be refuted; that we should not even try)   Even mild redistributive policies are apparently viewed by some as an ‘ideological anachronism’ – belonging to an apparently ‘defunct’ tradition of social democracy.  

Just how widespread these views are I cannot tell.  But there is a now-long history of Labor governments (dominated by the Party’s Right)  cutting and regressively restructuring tax, capitulating to the ideology of small government, and pursuing cynical policies such as assaults on the welfare rights of sole parents.  Top income tax rates, for instance, have been reduced or eliminated.  The tax system has become ‘flatter’.   Again, Chris Bowen has come out in favour of a ‘simpler’ tax system which includes lower Company Tax;  which probably translates as a less progressive tax system. (Bowen, pp 60-67)  Though there have been some efforts in the opposite direction from Labor governments as well; for instance raising the tax free threshold.

 More generally an outlook of pragmatism appears to make policy a matter of tactical expedience.

To summarize, this kind of pragmatism is highly questionable.  Bill Shorten was elected to reform the Party; and part of what people wanted was fidelity to Conference decisions. Shorten also has to offer his supporters on the Left something - after they were pivotal in his success.  If Labor fails to deliver on progressive tax, new social programs – and end up implementing only more austerity – just not as severe  as the Libs - that would show  a lack of conviction and principle.  For instance Gonski and NDIS were immensely popular policies!   Dropping or otherwise avoiding strong policies as a matter of tactical expedience  could  simply mean Labor continues hemorrhaging support to the Greens.  That would not be 'realism'.  It would be both ideological and practical self-destruction.

We are yet to see an outcome, here, however.  I hope these views I have encountered are not as widespread within Labor as I fear.  But it is a debate Labor has to have with itself between now on the National Conference in July this year.

I look at the Rudd/Gillard years as involving wasted opportunity. I look at the Hawke/Keating years also as involving wasted opportunity also.  For example, the  "Australia Reconstructed"  document suggested something 'Nordic' - but we got very little of the kind.  We need a Labor Party which pursues an agenda of steady, gradual reform - but appreciable reform nonetheless.   Real (steady) Progress is needed  - not 'one step forward, two steps back'.  So If Labor increases progressive tax and associated social expenditure and investment by 5% of GDP over three terms (roughly a decade) - that's a legitimate medium term agenda.

Another thing that really struck me in one discussion with a Labor colleague was his notion of the rise of a  'wants not needs generation'.  In contrast I would hold that the masses are still concerned with issues of non-negotiable need.  That is,  cost of living;  housing affordability; costs and quality of education; threat of illness or need of aged care for family members.  I think my Labor colleague overstates peoples disengagement from 'non-negotiable-needs'. A lot of people really are still 'doing it tough'.  And they are inclined to vote on that basis!  This needs to find reflection in the ALP’s National Platform.

None of this is likely to change unless progressives in the ALP begin organizing and agitating now – ahead of July’s National Conference.  Superannuation Concessions are ‘the elephant in the room’ – and a lack of decisive reform here will severely limit Labor’s options following the next Federal Election.  Labor doesn’t have to ‘lock itself in’.  But it is better for Labor to ‘keep its options open’ rather than lock into minimalist policies which offer very little real progress.   A POLICY of ‘tactical expediency’ is self-destructive;  but tactical decisions do need to be made during election campaigns.  And for Labor to ‘keep its options open’ there needs to be  a Platform which does not irretrievably commit Labor to small government; a platform which does not ‘lock Labor in’ to merely token reform of superannuation concessions.

Bowen, Chris, ‘Hearts and Minds’, Melbourne University Press, Melbourne 2013

http://www.tai.org.au/content/alp-dip-their-toe-30-billion-pool-super-tax-concessions

http://www.tai.org.au/content/sustaining-us-all-retirement

http://www.tai.org.au/research

  

In the Wake of the Greek elections: Is there a way out of the Recessionary Spiral?

above: The Symbol of the Rising SYRIZA Left-Coaltion in Greece

In this article Tristan Ewins discusses the aftermath of today's Greek Election.  Debate very welcome here - and at our Facebook page.  See:  http://www.facebook.com/groups/58243419565/

Tristan Ewins; June 18th 2012

There is some interesting analysis of the Egyptian and Greek elections over at radical-left blog 'En Passant'. Here at “Left Focus” I would like to take a moment to consider the consequences of the election in Greece – and alternative ‘ways forward’ – out of the depressive spiral which is engulfing much of Europe.
(See: http://enpassant.com.au/2012/06/18/greece-and-egypt-a-tale-of-two-elections/ )

In Greece, specifically, the Conservative “New Democracy” Party is set to form government – but with only approximately 30 per cent of the total vote. As a consequence of the specifics of the Greek electoral system the largest single party receives a 50-seat boost. This makes it very likely that New Democracy will attempt to ally itself with the pro-austerity PASOK. (Pan-Hellenic Socialist Party)

Nonetheless PASOK has historically supported a more moderate approach to austerity: the consequence of which must mean that any new coalition government between New Democracy and PASOK will see bailout conditions re-negotiated to “slow the cuts [and] introduce more generous unemployment benefit[s].” (See: http://blogs.telegraph.co.uk/news/danielhannan/100165822/another-non-result-in-greece-how-much-longer-can-this-go-on/ )

But in any case - it would be ‘the same poison’ of recessionary austerity - even if a milder variety.

At ‘En Passant’ John Passant further reports that while “left-wing radical group SYRIZA came second with just under 27%”, PASOK received “a little over 12%.” Meanwhile, “the Democratic left, a moderate split from SYRIZA on just over 6% and the KKE, the Greek Communist Party [managed] about 4.5%.”

The fascist, so-called ‘Golden Dawn’ party was thankfully contained on just under 7% of the vote: but it is nonetheless a significant precedent and could bode ill for the future.

The division of the Left in Greece has therefore been crucial for the Conservative victory. Had SYRIZA maintained internal unity it clearly would have emerged as the largest party in the Greek parliament rather than ‘New Democracy’. While the Left broadly defined was a hair’s breadth from securing a majority of votes, the additional 50 seats that would have been delivered to SYRIZA in the event of maintained internal cohesion would have been enough to deliver a clear Left victory. The Greek Left needs to think upon this should continued instability create another opportunity for a Left majority in the near future.

According to one website, SYRIZA leader Alexis Tsipras “called Samaras to congratulate him but later rejected any notion of dealing with New Democracy or PASOK.” Tsipras stated:

“We shall be present in any developments from the position of the main opposition,” he said, stressing that that “everyone must know that the measures of austerity and the selling off of state property will not be able to move forward because they lack popular legitimacy.” http://greece.greekreporter.com/2012/06/17/final-exit-polls-show-new-democracy-leads-syriza-in-tight-race/

The refusal of SYRIZA to deal with PASOK leaves PASOK in a potentially fatal union with New Democracy. Without very substantial re-negotiation continued austerity in Greece will see ongoing unemployment, poverty and even homelessness. The privatisation agenda, meanwhile, is blatantly Ideological. By maintaining its distance from the austerity policies of a PASOK/New Democracy government, SYRIZA is likely to rise as the main beneficiary at the next Greek election; more decisively displacing a relatively marginal PASOK. This is exactly why PASOK is refusing to agree at this point to a coalition without the inclusion of a very reticent SYRIZA.

One online news source has reported that:

“The results should bring a sigh of relief to Greece’s lenders, the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) who provided Greece with an initial bailout two years ago of $152 billion and approved a second in February for $173 billion more, but said it depended on Greece continuing with more reforms, including privatization and another $15 billion in cuts.”
http://greece.greekreporter.com/2012/06/17/final-exit-polls-show-new-democracy-leads-syriza-in-tight-race/

Rejecting the assumptions of this reporting, however, what is the answer for Greece?

As John Passant notes at En Passant:

“Unemployment Is running at over 22% and for the young it is approaching 50%. Growth fell last year by up to 7% and is predicted to fall again this year by around the same or slightly less.”

Firstly – as these figures demonstrate, a recessionary spiral is NOT the answer. Greece – as well as other affected countries such as Spain and Italy – need a plan for socially and economically sustainable debt repayment over the long term. Though this author does not claim to be an authority, it seems rational that if privately-financed bonds cannot provide Greece and other countries with fair repayment rates and schedules, then Europe as a whole needs to step in collectively at a public sector-financial level. As recognised above the IMF, European Union and European Central Bank are already providing a bailout. But this bailout has been offered under the wrong (ie: recessionary) terms.

Greece is currently caught between the toll of an eroding credit rating – with spiralling debt-repayment levels enforcing a macabre ‘discipline’ – and the real economic and human cost of austerity and enforced recession.

As an alternative, Greece’s effective credit rating needs to be fully restored in return for ‘locking into’ a European ‘economic contract’ aimed at restructuring the Greek economy, and repaying debts in the most efficient and sustainable manner possible – under conditions of full employment.

Only Europe-wide planning and co-ordination, now, can provide for such a process of restructure – mobilising the capital and the skills necessary to forge new and sustainable export markets – maximising that potential for debt-repayment under conditions of full employment. This applies as much for Spain and Italy as it does Greece.

The alternative is recessionary austerity: again with the consequence of homelessness, deskilling, poverty – in short, social and economic disintegration.

The SYRIZA anti-austerity platform can be found here and makes interesting reading:

(See:  http://www.solidarity-us.org/site/node/3620 )

From 1929 until the dawn of the Second World War the world suffered a Depression the consequences of which radicalised a generation, and with the experience of war-time economies entrenched a Keynesian orthodoxy, providing the basis of the Post-war boom. With SYRIZA refusing to join a unity government the battle in Greece is far from over. Do we really have to learn all the old lessons over again – with the associated toll in human misery?

Debate very welcome!

How to improve social wages with tax reform: Labor’s mission

above: Labor activists need to mobilise for this year's National Conference to ensure the ALP Platform is altered to allow a modest increase in overall taxation to provide real improvement to social services for the Aged, for the Disabled, and Cost-of-Living Assistance for ordinary families.

Readers are also welcome to join our Facebook Group at this URL: http://www.facebook.com/#!/groups/58243419565/

Tristan Ewins

15/10/11

Former NSW Labor Premier Kristina Keneally has argued recently that Labor needs to ‘get back to basics’. This doesn’t have to mean dropping a price on carbon or forgetting the rights of minorities. But to actually deliver on cost-of-living pressures before the 2013 federal election, as well as desperately-needed programs for the vulnerable, would require a significant ongoing public investment. The next two years offer the Labor Party the opportunity of delivering real reform, thus reviving Labor’s electoral and organisational fortunes.

The recent tax summit had all manner of people arguing that the wealthy ought pay more tax. Through tax reform, restructuring and the closing of loopholes (including unfair superannuation concessions for the rich) Labor should aim to expand annual social expenditure by at least 1.5 per cent of GDP over the next two years - a little short of $20 billion in today’s terms (in the context of an economy valued at approximately $1.2 t rillion). But this would require a change in the ALP Platform at the Party’s next National Conference, due in December 2011.

Already Labor Senator Penny Wong has warned that with rising pension, health care and aged care demands the Australian government could be “tens of billions of dollars short by 2050”. Meanwhile the National Disability Insurance Scheme (NDIS), if implemented in the near future, in today’s terms would come at an annual $6.5 billion price tag. And yet legitimate demands for cost-of-living relief, for fairer pensions, higher quality aged care and improved disability support and services loom immediately ‘in the here and now’.

Speaking recently to Paul Versteege from the Combined Pensioners and Superannuants Association (CPSA) I was told that “nursing homes are like warehouses for old people.” Now I was already under this impression but I felt it to be a very powerful and accurate metaphor. Usually there is little to do for residents in nursing homes. Even in ‘common rooms’ residents are simply sat down to stare at walls hour after hour, day after day. There is no variety in life, no change of scenery. Usually these facilties are stark, there are no gardens in which to find peace and comfort.

Many of our aged citizens spend years in these facilities, years of acute suffering admist death and awaiting death. Often there is a lack of qualified staff, especially nurses. This means residents can acquire bed sores if not turned at the necessary intervals, and sometimes residents can be left in soiled beds. Food is often of poor quality, and low staff-resident ratios mean that aged care workers do not always check to ensure residents have actually eaten their meals. Malnutrition and weight-loss can compound each other in a ‘downward spiral’. In the past lack of dental care has led to infections and even death. In the future access to information technology will be crucial.

The indignity and suffering of the aged deserves much more attention than it is receiving. An ageing population will demand an increse in funding. But we also need to improve services now, not just ‘tread water’. Crucially, many of us that live to old age will one day need aged care. And so will our families and loved ones.

It is essential that we move away from user pays models in aged care. Despite claims to the contrary the Gillard Labor governemnt is still effectively demanding that aged Australians sell their homes in return for sub-standard care. The mechanism operates like a massive regressive tax. We need to ensure that all aged Australians receive the same very high quality of care on the basis of need and regardless of wealth. And such high-quality universal aged care must be funded progressively, not through what the Combined Pensioners and Superannuant’s Association calls a “pre-death death tax”.

Meanwhile there is some hope on the disability support and services front with Julia Gillard’s annoucement earlier this year of the government’s intent to implement the NDIS. Crikey reports that the scheme will offer “financial cover for services including for respite care, vehicle modification, accommodation support, therapies and prosthetics,” It is “expected to cost the government an extra $6.5 billion a year.”

And yet while the Productivity Commission suggested a 2014 implementation it is not certain that the government will meet this time-frame, with some suggesting a delay of seven to eight years. This simply is not good enough. Properly a NDIS should also involve construction of dedicated care facilities for the disabled who require intensive care so they are not left in aged care facilities in which they are isolated and do not ‘feel at home’.

But importantly the needs of the aged are just as desperate as those of the disabled and their carers. If there is $6.5 billion in additional funds that will be devoted to a NDIS then surely a similar amount must be devoted to improving the quality of Aged Care, supporting carers and removing user-pays mechanisms for poor and working class families. The government could begin with an annual $5 billion injection with more ‘in the works’ for the future.

Then, of course, there is the question: Where is the money coming from?

There could be progressive levies for the proposed NDIS and for aged care – or maybe some kind of single shared levy. And perhaps some of the funding gap could also be met with progressive reform and restructure of income tax. Venture capitalist Mark Carnegie thinks the wealthy (including himself) need to pay their ‘fair share’. Specifically he has suggested at the recent tax forum that 15 per cent extra in tax ought be levied from the wealthy top 15 per cent. Yet Assistant Treasurer Bill Shorten has dampened expectations claiming such measures would be unlikely to be implemented.

Shorten has been an eager proponent of the NDIS, but he needs to start thinking of progressive ways to actually fund and implement the program. And hopefully he will apply the same standards of decency and compassion by popularising a similar program for aged care as well. John Passant has suggested other measures: an inheritance tax, minimum company tax, end capital gains tax concessions, tax trusts as companies, implement land tax for properties valued over $1 million, apply stronger economic rent taxes on mining, banking, and supermarket oligopolies.

Some of these proposals could form part of a more long-term agenda of reform, with Labor aiming to expand the social wage proportionately by 1.5 per cent of GDP per term of government, levelling out after several terms.

Nonetheless, funds levied over the next two years could then be deployed to provide stop-gap services and support in anticipation of a broader NDIS by 2014, with a similar scheme for aged care. Such ‘stop-gap’ measures could be crucial in that the government would be seen to be ‘delivering the goods’. This is always more valuable than promises only ‘for the distant future’.

By locking such investments in and implementing the necessary funding mechanisms pressure would also be applied upon Opposition leader Tony Abbott to maintain bipartisan support. Abbott would appear callous were he to sabotage or obstruct such programs, and in contravention of self-professed Catholic/Christian convictions of compassion towards the vulnerable.

After reform of Aged Care and Disability Support and Services, much of the remaining funds (from an $18 billion pool) could then be dedicated to a major cost of living package aimed at mainstream working Australia as well as the most vulnerable. Tax reform measures as alluded to earlier could be deployed to provide robust subsidies for energy and water in the case of low-middle income households, and for new public housing (increasing supply, and hence enhancing affordability). Broader tax restructure could also benefit these households, and comprise part of the package.

Over the long term, meanwhile, Labor could move to gradually resocialise energy and water, perhaps on a national basis, while moving away from user-pays mechanisms for roads and other essential infrastructure. Lower public sector borrowing costs could be passed on to consumers, while small consumers (individuals, families) would no longer be discriminated against because of lack of market power. Finally, productivity agreements with unions - including retraining and active industry policies - could deliver the best value for the public over the long term while providing justice and security for workers. Such initiatives would thus negate the core arguments for privatisation. Tighter regulation of energy/water over the trasnsitional period necessary for resocialisation could also be an essential part of a cost-of-living package.

Some of this money could also go towards funding the realisation of the Australian Service Union’s (ASU) community sector wage claim, which would make a massive difference mainly for women but also for men, working in that field. This could also lead to an influx of skilled labour and a big increase of morale in aged care.

Finally, the dire need to improve poverty-level Newstart benefits (even in the midst of harsh active labour market policies) demands action. And stricter conditions for the Disability Support Pension need to be reconsidered in light of the reduced job prospects and capacity of those genuinely disabled nonetheless judged able to work in someform.

Some funds could flow to the public coffers by cutting Dividend Imputation from 100 per cent to 75 per cent. Dividend Imputation involves ‘credits’ applied so that dividends are not taxed ‘a second time’ after Company Tax. But the measure – not applied widely outside of Australia – overwhelmingly favours the wealthy and in any case Company Tax rates have been steadily eroded in recent decades.

Partial withdrawal of Dividend Imputation could be crucial in reaching the $18 billion target. John Quiggin has argued for half dividend imputation in the past (which would yield over $10 billion). But getting ‘a foot in the door’ for tax reform (with 75 per cent imputation) could be a precursor for further reform in the future.

Targeting Dividend Imputation like this is a good strategy because, as opposed to raising Company Tax, the costs are less likely to be passed on to workers and consumers through reduced wages and increased prices. As a strategy it would target the ‘rentier’ capitalist class and thus would be a fair and egalitarian measure.

Assuming the implementation of such a reform agenda, even were Labor to lose in 2013, there would be a valuable and lasting legacy of which Gillard, Swan, Shorten, Wong and the federal Cabinet could be proud. Indeed, such programs would comprise a veritable ‘rallying cry’ for Labor’s eroding membership and core support base.

But by actually deliving such a big $18 billion/year package and making a real difference for mainstream working Australia as well as the most vulnerable Labor can still hold hope of victory in 2013.

Ammending Labor’s National Platform this coming December 2011 to enable an expansion of social expenditure by 1.5 per cent of GDP would provide hope for Labor and for Labor’s constituency.

Tristan Ewins is a freelance writer, qualified teacher and social commentator based in Melbourne, Australia. He is also a long-time member of the Socialist Left of the Australian Labor Party (ALP).

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.