Letters from a Labor Activist ; November/December 2016

above:  Humanity does not Live by Bread Alone ; What about Democracy and Political Literacy in our Educational Curricula?

Progressive Letters to 'The Age' and 'The Herald-Sun' ; (November/December 2016) ; Everything from ‘Public Debt Shibboleths’ to Privatisation, Defending Democracy,  The Right Protest, Education for Politically Literate and Active Citizenship, and more ; Please feel welcome to read and comment on the articles, share via Facebook and so on.

Dr Tristan Ewins

Is there a public debt crisis?  Or is the Crisis one of Private Debt?

(Debt letter One)  (Unpublished)  Regularly we are warned of the ‘immense threat’ of government debt.  But its best, here, to use the measure of ‘net debt’ which also includes revenue from government assets.  (instead of ‘gross debt’ - which does not)  For example, with the privatisation of assets like the Commonwealth Bank gross debt fell, but net debt worsened significantly.  Australian Government  net debt was recently measured around 18 per cent of GDP : approximately $285 billion in an economy around AUS $1.6 billion.  But HOUSEHOLD debt – ie: the debt owed by Australian individuals and families – is over 100% of GDP -  over $2 TRILLION.  Private debt is clearly the bigger threat. The Liberals try and offset private debt with public austerity – in health, education, welfare, infrastructure. But these areas are often more crucial to our well-being than private consumption.  So arguably we need a BIGGER social investment in these areas as opposed to cuts. We need a more balanced approach ; containing debt long term – without gutting public services and infrastructure, or destroying  jobs and growth.  And now is a good time to invest in potential income bearing (and other) government assets – on account of low interest rates.  A big investment in public housing could also make housing more affordable –  making significant inroads into private household debt.  We also need an industry policy to achieve full employment –and full time jobs for those who want them.  That could offset an ageing population without resort to measures like raising the age of retirement.

References:

http://www.natsem.canberra.edu.au/natsem-budget/natsem-pre-budget-2016-state-of-play/how-much-public-debt-do-australians-have/

https://theconversation.com/election-factcheck-has-100-billion-been-added-to-australias-national-debt-under-the-current-government-60701

(Debt letter Two) (Published) Bruce Hambour (Herald-Sun Letters, November 2016)  writes that debt is getting so out of control that welfare must be cut to rein it in. But why start by cutting the payments for some of our most vulnerable and disadvantaged Australians when there are other options?  Why not drop massive corporate tax cuts, and other tax cuts for the well off?    Why not cut back Superannuation Tax Concessions – mainly beneficial to the well-off – whom taxpayers are effectively subsidising by tens of billions every year?   Also public sector debt is actually negligible compared with private debt.  (approx. 30% of GDP compared with 200% of GDP)  The housing bubble hasn’t helped ; and what’s needed are big investments in public and social housing (to increase supply), and in infrastructure and services (to ensure quality of life).  Also Conservatives attempt to play the working poor of against the vulnerable welfare-dependent.  (divide and conquer) That’s better fixed by raising the minimum wage, and improving the social wage for the working poor.

Herald-Sun Op-Ed Describes Labor Left Opposition to Privatisation as “Extremist”.

(Published)  James Campbell (Herald-Sun, 24/11) depicts Labor Left opposition to privatization as ‘extremist’.  But what grounds are there for this opinion?   Most Australians did (and still do) oppose privatization of important government assets.  And the longest-serving Australian Liberal Prime Minister, Robert Menzies, presided over a relatively larger public sector (and more steeply progressive income taxes) than Labor governments of the 80s and 90s.  The ‘extreme’ tag is a flippant way of dismissing an argument without having to engage or justify your position.  ‘Natural public monopolies’ (eg: in water, communications, energy) would reduce costs for the broader economy.  And Medibank Private’s recent privatization saw private health insurance costs rise as the newly-privatizated corporation arguably began abusing its market power.   The Commonwealth Bank can also make profits close to $10 billion now.  That means our net government debt position is much worse now because of its privatization.  Since its privatization there have also been problems with fees, and the quality of services for regions and financially disadvantaged customers.

Herald-Sun letter calls for ‘Technocracy’ in place of Democracy

(Unpublished)   Simon Hammond (Herald-Sun, 26/11) claims democracy is to blame for weak and indecisive government .  Instead he suggests a kind of ‘government of experts’. (a technocracy) But the problem is not democracy ; it is particular practices such as poll and focus-group driven politics ; and ‘gotcha’ politics’ which neglect the substance of policy choices.   Another problem is the major parties all aiming for ‘the centre ground’ ; not standing up for their beliefs. (‘Convergence politics’)   That means weaker pluralism. That is, less choice.  In fact we need a stronger democracy.  A free multi-party system is meant to ensure scrutiny of public policy and social issues ; but often media neglect the substance ; and politicians respond by playing to shallow agendas.  We need to transform our society ; which could be achieved partly through educational curricula for active and politically literate citizenship ; which is ideologically inclusive and  encourages students to think about – and stand up for - their rights and interests. 

Responding to Andrew Bolt on the causes of the Trump Victory

(Unpublished)  Andrew Bolt calls the Trump election victory “a revolt against the Left’s arrogance” (Herald-Sun, 10/11). But reality is more complex than this.  A neo-liberal consensus  - a particular INTERPRETATION of ‘globalisation’ - has prevailed around much of the world, facilitated by BOTH the parties of the Right and of the ostensible Centre-Left. Working class people who had lost their identity, as well as their economic and social security with the destruction of their jobs – gravitated towards a promise to restore America’s industrial base.   Trump’s old school protectionism might not be the answer, but Nordic-style, targeted industry policy might serve better.   Policies which promote high value-added manufacturing alongside Research and Development, and promotion of information and communications technology industrial development.   The US Left needs to actively court the working class – including white males – with policies that offer the respect and security which could be key to building a broad electoral bloc, and rolling back Trump’s support base.

Why Scott Morrisson and the Liberals are Wrong on Company Tax Cuts

(to both the Herald-Sun and The Age ; Unpublished)  Today (28/11)  it was distressing to see Treasurer Scott Morrison in Question Time defending massive cuts to Company Tax.   He referred to Trump’s objective of a 15% corporate rate, and suggested Australia needs to be ‘competitive’.  But the United States had enjoyed a maximum corporate rate of 35% for many years under both Republican and Democrat Administrations.  Elsewhere, the reality is that high quality social services, education, infrastructure are ‘pull factors’ for investment as well.   And this needs to be paid for somehow.  The Conservative approach is ‘corporate welfare’.  That is: the corporate rate is cut - but workers, pensioners, families ‘pay the price’ one way another.  Through unfair ‘replacement taxes’ like the GST , or through a neglect of services and infrastructure which is arguably bad for investment anyway. We need international agreement to stop ‘the race to the bottom’ in corporate taxation.  Without this the economy will suffer anyway – as ‘corporate welfare’ takes income away from the very workers  whose consumption supports the domestic economy. 

Feminist Revolution must take account of class ; must be based on Mutual Respect and Empathy

(Unpublished)  Trish Thompson (‘The Age’, letters;  30/11) reminds us of “the privileges of being a white heterosexual male”.  But she makes no mention of social class .  That determines our quality of life ; where our kids go to school ; often the quality of our diet and health care; whether we can pay the bills and put a roof over our heads ; what else we can enjoy outside of work.  Other factors include whether or not our work is fulfilling ; and what economic (and hence political) power we have.  Why is class usually forgotten today ; or otherwise relegated to a subordinate position?  Age, body image and disability are also relatively neglected. We are in the midst of what might be called a feminist revolution.  What’s at stake is whether or not that revolution is broadened in pursuit of genuine mutual solidarity and liberation.  Or whether there is a kind of ‘turning of the tables’.  Many men are reacting against discourse they see as inferring ‘masculinity’ and male sexuality are ‘essentially bad’.   Without mutual respect and empathy there will be a reaction and the feminist revolution might fail.

Working Class Men don’t have ‘a lot to gain’ from Deindustrialisation and the Consequence is Unemployment and Poverty

(Unpublished)  Jacqueline Maley  (‘The Age’, 3/12/16)  writes as if men have more to gain than lose through deindustrialisation. The reality, though, is that older skilled manufacturing workers will not find replacement work making use of their skill sets.  And service industry jobs are unlikely to make up for the 50,000 jobs lost in the car industry and supporting industries .  The notion that when men take up service industry jobs that these will rise in stature is questionable.   The balance of trade is another associated concern.  It is a function of capitalism more so than patriarchy that ‘unprofitable’ service jobs are devalued. For example, a better deal for both aged care workers AND residents might ‘eat into corporate profits’ – directly (eg: through higher corporate tax) or indirectly (with a reduction in private consumption power with higher income or consumption  taxes). That said we do need to ‘valorise’ caring (often ‘feminised’) professions.   We need a re-regulation of the most-highly-exploited end of the labour market.  To reform the tax mix and extend the social wage.  Resistance to the extension and improvement of social services is most likely to come from capitalists and their advocates in the so-called ‘political class’ rather than from working class men.

We Must be unambiguous on the Right to Protest ; and stand against even more regressive User-Pays in Tertiary Education

(Part-Published)  David Penberthy  (Herald-Sun 4/12/16) condemns the protestors who disrupted parliament the other day as ‘ratbags’. He goes on to support user-pays in Higher Education, arguing ‘Why should blue collar workers pay for someone’s Law degree?”   In response ; democracies must defend liberal and democratic rights, including speech, association and assembly.  But arguably a mature democracy – which feels secure in itself - accepts there will be occasions where differences of principle become so steep that accommodation must be made for civil disobedience as well.  Such flexibility helps define us as a genuinely *liberal* democracy.   Furthermore: Penberthy’s defence of user pays in Higher Education ignores the fact that were a greater portion of education costs shouldered through income and corporate taxes – then roughly people and interests would pay in proportion to the financial benefit gained.  And if we wanted to reform the Higher Education Contribution Scheme (HECS)  to make it fairer, then we might raise repayment thresholds.  There are many former students on less than the average wage who are forced to repay loans that bear no relation to their actual incomes.  Repayment thresholds have fallen relative to the average wage: and that is unfair.

 

Why Political Literacy, and encouraging Active Citizenship must Have Their Place in Educational Curricula ‘in a strong democracy’

(Unpublished)  There is a developing view (Herald-Sun Editorial, ‘Teach don’t Preach’ , 7/12/16) that ‘politics should be kept out of the classroom’; and that means not only that teachers ‘should not be advocating causes’ – but also that there should be a ‘back to basics’ movement emphasising science and maths.  The problem with this is that education needs to be for life – and while maths and science have their place,  education for politically literate and active citizenship can strengthen our democracy and empower our citizenry to work for their beliefs, rights and interests. To achieve bipartisanship – there needs to be a reformed National Curriculum – which exposes students to the ideas of BOTH the Democratic Left and the Democratic Right, while also imparting an understanding of other ideologies.  As the saying goes ‘man does not live by bread alone’.   An active and informed democracy should have bipartisan support across the Democratic Right and the Democratic Left.

(Unpublished)   Greg Byrne (Herald-Sun, 10/12/16) refers to  education about “gender, ethnicity and class” as “nonsense” that has nothing to do with finding jobs.   But the Humanities and Social Sciences involve research and writing skills ; the construction of detailed arguments , and evaluating complex information.  Also humanity ‘does not live by bread alone’.  (ie:  the labour market and work)  A stronger democracy (based on understanding and participation) rests on citizens’ political literacy (understanding political ideologies, values, movements, processes) and on their powers of expression.   The Humanities and Social Sciences drive us to ask fundamental questions about the human condition ; about ethics ; and thinking critically about democracy, economy and society.   In a strong democracy we must be empowered to make informed choices as citizens – regardless of whether we perceive ourselves as being of  “the Right” or “The Left”.  That means imagining alternatives to current social and economic arrangements in pursuit of ‘The Good Society’. Here,  assessing the balance of wealth, power  and opportunity in society is a legitimate question.

Recent Observations from the Media ; And observations on the ALP’s Policy Trajectory

above: Bill Shorten needs to focus more on Policy Substance and Depth; 
Very Little is possible without a serious commitment of resources

What follows is some commentary on recent material in ‘The Age’, ‘The Herald-Sun’ and the “Border Mail’, as well as a critique of Labor’s current lack of policy on strong tax and superannuation concessions reform….

Dr Tristan Ewins

Cash Splash?  How a ‘throwaway line’ offends both our values and our intelligence

 

i)                    ‘The Age’ should have been more careful with its rhetoric in relation to  the Gonski education reforms. (‘The Age’, 29/12/15)  In particular the term ‘cash splash’ is highly questionable.  Of recent years the term has been deployed heavily, with the obvious inference that the public spending associated is ‘frivolous’ or ‘wasteful’.  Indeed the term has consolidated the neo-liberal Ideological assumption that public spending generally tends to be wasteful.  But Gonski is anything but wasteful. The Gonski initiative and its associated funding are crucial in stopping the drift to a highly stratified education system; where the state sector becomes ‘residual’ and ‘second class’.  That is: only for those who cannot afford better.  By contrast Gonski has as its assumption that this drift must be halted, and that all students should have the opportunity to realise their full potential. There are economic reasons for this (training tomorrow’s workforce) – but the social and cultural ramifications are just as important.  Journalists for ‘The Age’ should be more careful in the future.  Gonski is anything but a ‘cash splash’, and ‘The Age’ should from now on be more careful in realising the ramifications of this kind of rhetoric.   (letter to ‘The Age’; edited version published)

 

A Surprising Position on Tax Reform in the Herald-Sun of all Places!

 

ii)                  It is good to see the Herald-Sun considering options for fair tax reform as opposed to austerity.  Capital Gains Tax discounts and Negative Gearing provisions are already set to cost around $20 billion year as Kara Vickery’s article (14/1/16, p 15) indicates.  But there are other options for government in containing the $40 billion/year deficit.  Dividend Imputation (rarely applied outside of Australia) could also be wound back for another $20 billion a year.  And a more rigorous winding back of unfair Superannuation Concessions for the wealthy and upper middle class could bring in well over $20 billion a year. Finally there are other options to actually expand investment in infrastructure, education  and health, fair welfare, and more.  Company Tax could be held steady. (already at 30% is lower than the Amercian rate) The Medicare Levy could also be increased and restructured – and channelled into Aged Care and Mental Health. And for the sake of fairness bracket creep for low and average income Australians could be contained by indexing the bottom thresholds.  Austerity is not the answer to the deficit – and would only hurt the economy , and at the same time some of our most vulnerable Australians.  (letter to ‘The Herald-Sun’ ; not published)

 

 

iii)                Interesting Position from NSW Labor Leader Luke Foley on the GST

The ‘Border Mail’ recently observed that:  “Opposition Leader Luke Foley [said] he would consider supporting an increase in the GST from 10 to 15 per cent as long as the funds were used solely for health and education and to compensate low-income earners.  NSW Conservative Premier Mike Baird seems to agree.  But the ‘Border-Mail’ also observed that:

“federal treasurer Scott Morrison insists any potential GST increase must also be used to fund income and company tax cuts”

In response I would argue the following:

A package including but not limited to the GST and other measures can be made 'progressive' depending on the compensation. If the compensation is strong enough the poor could even end up better off. (ie: if an increase in the GST pays for big improvements in welfare, targeted tax concessions etc) The problem, though, is that taxpayers tend to focus on INCOME TAX.   And if we cut the income tax of people on low incomes, for instance (in order to compensate), later down the track that will come under pressure as a consequence of high income (and potentially even some middle income) resentment.  Any increase to welfare could also come under pressure in such a way.  The focus will be on the simple rates of welfare (without considering the place of compensation in the total package), as well as the cost to the Budget and so on.  AND before you know it that compensation is whittled away! That is: both tax credits, income tax restructure, increases in welfare.... So in the end – over many years - we have a reversion to the full impact of the increased GST re: its distributive effects. Those on low incomes especially will be hit hard. Which is why we need to communicate this fact to Foley and others who think raising the GST could be a good idea.

This is not to suggest, however, that we should not try and raise welfare and lift people out of poverty.  But a big restructure of income tax as compensation for an increased GST would definitely face a significant threat of being wound back over time.  Possibly through another restructure later down the track.  And possibly because of bracket creep. (if there is not indexation of the lower thresholds)

There are alternatives, however: Tackle negative gearing; reduce dividend imputation, wind back capital gains tax concessions; maintain company tax; raise and restructure the Medicare Levy; introduce a financial transactions tax; withdraw superannuation concessions for the wealthy and the upper middle class; impose a super profits tax on the banks; introduce new progressive property taxes, modest inheritance taxes for large inheritances...

Indeed the measures listed above could potentially bring in $60 billion or more.

I can see how if the specific model of change pondered by Foley was implemented it could have good outcomes short term. But I'm just saying the progressive distributive changes would be whittled away over time. And eventually the effect would be regressive.

 

iv)                But isn’t Bill Shorten promoting strong reform on superannuation concessions?

 

Well, No.  The superannuation concessions reforms currently proposed by Bill Shorten currently are VERY modest.  The suggested reforms could even be dismissed as being ‘cosmetic’ in ‘the big picture’.  Shorten proposes cutbacks in concessions only for the wealthiest of all: "$14 billion OVER TEN YEARS" (that is: $1.4 billion a year by today's reckoning)  By contrast Richard Denniss of the Australia Institute believes the cost of Superannuation Concessions will soon balloon to OVER $50 BILLION EVERY YEAR.  (ie: by 2019)   And the deficit is currently in the vicinity of $40 billion a year.  To get a sense of proportion the economy is valued at approximately $1.6 Trillion.  So Bill Shorten's proposed superannuation concessions reform amounts to about 0.01% of GDP – and probably proportionately less when you factor in economic growth.  That is: it is so modest as to be considered trivial.

All this means that a Labor government will be under enormous pressure to introduce austerity. At this rate there could be cuts in pensions, an increase the retirement age, and so on.  Or they will ‘sit on the deficit’ and attract massive flak from the Conservatives.

At the ALP Socialist Left Forum Facebook Group one contributor inferred I should just get behind Labor’s costed policies, and that criticism was simply succor to the Liberals.

But the ALP Left is more than a 'cheer squad' for opportunistic policies that are about appearance and not substance.  I am saying that once we step back from the heat of the rhetorical policy battle - there is not enough SUBSTANTIAL difference between us and the Libs on policy yet. (though there are notable differences on Penalty Rates for example)

NOW if you want to talk about ALP Policy - I understand the PLATFORM does NOT lock us in to 'small government'. But understand that as things stand - without a change of direction - we won't have the fiscal ‘room to move’ to fully introduce Gonski and NDIS - let alone other absolutely critical reforms like:

·         National Aged Care Social Insurance on a similar scale to NDIS

·         reform of welfare to lift the most vulnerable out of poverty

·         full integration of dental, optical, physio, psychology, hearing aids, speech therapy, urgent cosmetic surgery -  into Medicare

·         increase proportionate and absolute funding for mental health

·         Begin a fully-funded program to ‘close the gap’ on mental health related  life expectancy - just as critical a priority as ‘closing the gap’ re: indigenous lifespan

·         A big investment in public and social housing

·         Maintain a retirement age of 65

·         Restructure HECS to approximate something like a genuinely progressive tax

·         Big public investments into infrastructure: transport, energy, water, communications, hospitals, schools, ports and more

·         Bolster Legal Aid

·         Kickstart a process leading to a negotiated Treaty with indigenous Australia

·         Big public investment into renewable energy research and infrastructure

Without root and branch reform of tax and superannuation concessions pursuing even a modest selection of said policies (above) would mean either extensive austerity elsewhere, or a ‘sit on our hands’ attitude to government. (neither of which are acceptable)  ‘One step forward, two steps back’ is not enough , and the prize of government is not sufficient if there is so little progress on the policy front.

I want a REFORMING LABOR GOVERNMENT. I want 'the forward march of labour' to get moving again.  A trajectory of progress.  Is that too much to ask?

Responding to Kim Carr on the ALP's ‘Socialisation Objective’

 

Above: ALP Socialist Left Senator Kim Carr is right to take NSW Labor leader, Luke Foley to task for rejecting the ALP's 'socialisation objective'; But he is wrong in his apparent rejection on an 'extensive' public sector.

The socialisation objective is about more than nationalisation ; but extensive and strategic social ownership needs to factor into our plans and principles.

Tristan Ewins

In ‘The Age’ on August 9th 2015, Socialist Left Labor Senator Kim Carr provided a statement in defence of the ALP’s standing Socialist Objective.   That includes the ‘socialisation objective’ specifically which (originally in 1921) committed Labor to the following:

‘‘The Australian Labor Party is a democratic socialist party and has the objective of the democratic socialisation of industry, production, distribution and exchange, to the extent necessary to eliminate exploitation and other antisocial features in these fields.’’

He also relates how in 1981

“23 explanatory subparagraphs were added to it. These set out goals such as full employment, the abolition of poverty, a more equal distribution of wealth and the elimination of exploitation in the home.”

Carr places himself at odds with NSW Labor Leader Luke Foley – for whom the socialisation objective was ‘confusing’.   Foley was beginning from the assumption that socialisation means nationalisation – and that those defending it were simply engaging in obfuscation.  For Foley Labor ought ‘say what it means and mean what it says’.   If we are about ending exploitation, then in the Marxist sense this infers the abolition of wage labour.  This is important – as is the question of socialisation interpreted as nationalisation.  And we will come back to this later- to consider why the positions of both Foley and Carr are problematic.

For Kim Carr it is the more-recent explanatory paragraphs which communicate the true essence of the Party’s Socialist Objective.  Further elaboration or reformulation are thus considered not necessary.

Some commentators have argued to the effect that these ‘explanatory paragraphs’ rendered the Objective meaningless anyway.  But before proceeding it is useful to consider specifics.  Hence the following selection from that section of the ALP Platform in question:

"c) Redistribution of political and economic power so that all members of society have the opportunity to participate in the shaping and control of the institutions and relationships which determine their lives.

"d) Maintenance of and support for a competitive non-monopolistic private sector, including small business and farming, controlled and owned by Australians, operating within clear social guidelines and objectives.

"l) Equal access and rights to employment, education, information, technology, housing, health and welfare services, cultural and leisure activities and the law.

"j) The abolition of poverty, and the achievement of greater equality in the distribution of income, wealth and opportunity.

"n) Recognition and protection of fundamental political and civil rights, including freedom of expression, the press, assembly, association, conscience and religion; the right to privacy; the protection of the individual from oppression by the state; and democratic reform of the Australian legal system.

"p) Elimination of discrimination and exploitation on the grounds of class, race, sex, sexuality, religion, political affiliation, national origin, citizenship, age, disability, regional location, economic or household status.

"t) Recognition of the need to work towards achieving ecologically sustainable development.

"u) Maintenance of world peace; an independent Australian position in world affairs; the recognition of the right of all nations to self determination and independence; regional and international agreement for arms control and disarmament; the provision of economic and social aid to developing nations; a commitment to resolve international conflicts through the UN; and a recognition of the inalienable right of all people to liberty, equality, democracy and social justice."

Hence the Objective is really quite extensive and substantial, and it does not restrict itself solely to socialisation interpreted as nationalisation. Indeed it could be considered both politically liberal and democratic socialist as well in the sense of advocating universal social rights of citizenship.  The promise of moving towards equality of political and economic power suggests a radically redistributive project, but at the same time there is the important (and realistic) concession in support for a non-monopolistic, competitive private sector. 

This Objective – reformulated in 1981 to be inclusive of both the Party’s Left and Right could be interpreted after the way of Nordic social democracy, with the probable implication of supporting a comprehensive welfare state and social wage; a progressive taxation system; as well as appropriate industrial rights. But there is room for improvement.  Some of these could be spelled out more clearly and overtly. And the significance of socialisation interpreted either as occurring through the public sector – or through a more diverse ‘democratic sector’ including State Aid for co-operative and mutualist enterprise – is not elaborated upon sufficiently.

Kim Carr gives the impression that he believes Foley’s proposed Objective is “tepid” and weak – and could just as easily find a place in the Platform of the Liberal Party.  After all, who today disagrees with the principle of ‘equal opportunity’ – at least openly or ‘in theory’?  Carr gestures towards the true inequality of opportunities that persist under capitalism ; for instance the meaninglessness of any ‘freedom’ of individuals to negotiate terms in the labour market – where the only real strength of workers under these circumstances – their collective solidarity – is progressively undermined and even criminalised.  He argues that this:

“is like saying that a millionaire and a homeless person have the same freedom of choice to sleep under bridges”

And for socialists ‘equal opportunity’ must mean more than ‘meritocracy in the labour market’. As the Objective insists, it must include: “Equal access and rights to employment, education, information, technology, housing, health and welfare services, cultural and leisure activities and the law.”   Socialism implies progress towards the principle of ‘From each according to ability, to each according to need’.

Sure, the Liberals make a mockery of ‘equal opportunity’ in practice – supporting privilege in Education, and proposing deregulation where quality of education would depend upon user pays mechanisms which excluded the poor and much of the working class.  Chris Bowen has also gone a bit further, arguing for equality of outcomes in Health.  Bowen’s proposal of a ‘toothless’ National Conference; his apparent opposition to a robust mixed economy; his support for a simpler (ie: in reality less progressive) tax system –  are all disappointing. But support for real equality of opportunity in education, and crucially equality of outcomes in health - comprise a beach-head for something more progressive – and so this common ground should be capitalised upon.

Hence we desperately need to commit to a National Aged Care Insurance Scheme,  Medicare Dental, and ‘closing the gap’ on life expectancy of the mentally ill – ahead of the next Federal election.

Notably: because the Conservatives are progressively abandoning meaningful commitments to political liberty and civil rights, as well as genuine and comprehensive meritocracy through a more accessible and equitable regime of Education – that should not be taken as a signal to simply opportunistically occupy the vacated political space. Aspects of Greens policy have been depicted as ‘extreme’; whereas in reality they are closer to the legacy of Whitlam, say, than we are ourselves often in the ALP today.  We cannot accept these terms of debate ; and we cannot simply move to the Right and allow to Greens alone to occupy that political terrain. The Politics of ‘Convergence on the Centre’ are really self-defeating where it occurs on the terms of our Conservative rivals, and on the terms of an Ideological monopoly mass media.

If we are truly a democratic socialist party we must not only exist for winning elections as an end in itself.  We must be about contesting the very substance of ‘the mainstream’, progressively reshaping the discourse to shift the relative centre to the Left in keeping with our values.  Antonio Gramsci would refer to the formation of a  ‘counter-hegemonic historic bloc’ – an alliance of forces through which society’s ‘common sense’ is reconstructed as the substance of democratic socialism. Again after Gramsci this could be interpreted as a ‘war of position’ – taken in our own specific circumstances as a process of laying political siege to, and contesting the institutions of civil society and the state. Culminating in the democratisation of the State itself – so that the way is unambiguously open for ‘a democratic path’ to socialism.

Kim Carr concludes his commentary by elaborating on what socialisation means to him.  To establish this we will reproduce some of his closing comments on socialisation:

“It is not about the straw man of extensive public ownership and a centrally planned economy. But it is about public entrepreneurialism, and public investment in the forms of human endeavour that are necessary to build and sustain a democratic, just and technologically advanced society.

Socialisation is about defending a just minimum wage and fair working conditions. It is about the creation and defence of Medicare, the enhancement of a great public education system, and the construction of national infrastructure such as the Snowy Mountains Scheme and the National Broadband Network.”

While Carr’s support for public education, nation-building infrastructure and ‘public entrepreneurialism’ are encouraging, he himself appears to be conceding substantially to the neo-liberal Ideology.  That is: In the sense of implying support for ‘small government’ through rejection of an “extensive” public sector.   While Foley wants to get rid of the socialisation objective because he rejects any radical connotations, Carr seems to be implying that we sidestep or reject content associated with public ownership – content which could potentially and progressively challenge the current distribution of power and wealth under capitalism. (and hence not acceptable to capitalists)  Though perhaps Carr is open to tax reform, as well as social wage, social insurance and welfare extension – all of which are central components of a democratic socialist agenda of ‘socialisation’.  Here we could do with specifics – and policy ambition.

Few today support a Soviet model of centralised state planning.  But we should not close our eyes to the possibilities of strategically extending the public sector, and engaging in strategic instances of planning.  Neo-liberal Ideology rules out public and democratic sector expansion as well as socialisation interpreted as regulation where ‘the absolutism and prerogatives of capital’ are progressively curtailed.  (see the work of the Swedish social democratic thinker, Nils Karleby) But the old socialist Ideology aspired towards progressive nationalisation – potentially over decades.  In the 1970s socialists like Stuart Holland hoped that the ‘commanding heights’ of the economy would ultimately revert into public hands.  Today, though, we could well embrace the project of a ‘democratic mixed economy’.  

The ‘way forward’ to something along the lines of ‘socialising the commanding heights’ appears to be blocked on account of the dominant Ideology, and also because of the power of Capital to obstruct reform through destabilisation, capital strike, disinformation etc.  Indeed, this can be a corrupting influence upon democracies.  Here, while the sheer political and economic clout of the biggest transnationals is a genuine threat to democracy, working people and citizens nonetheless stand to benefit from job-creating-investment, and as consumers from various innovations in areas ranging from automotive industries to information technology.  While the scale of the transnationals is in some ways threatening – and we need to frankly recognise this - the economies of scale and competition involved can have benefits in these fields. Though there are also other problems (eg: built-in-obsolescence) which might be remediable through some form of regulation.  And global solidarity of labour is necessary to prevent the transnationals from simply exploiting the poorest and least organised workers.

And yet much of the old socialism remains instructive. Capitalism can be inefficient, unstable and wasteful. It can create conditions of exploitation and human alienation.  The expropriation of a portion of the proceeds from labour by capitalists remains morally problematic even though few on today’s Labor Left will openly discuss this. For genuinely small investors (eg: other workers) dividends may comprise a fair return in the context of making a sacrifice through deferring consumption. But in the bigger picture a portion of the value created by workers is expropriated by capitalists. Workers generally do not enjoy the full proceeds of their labours. These arguments are commonly ignored simply because the consequences are potentially radical for a Left ‘on the back foot’ in a steady (decades-long) process of liquidating its own traditions in order to ‘Converge at the Centre’. Here it was really Hawke and Keating who ‘led the way’ providing the ‘inspiration’ for Blair.   We need to retain a frank critique of capitalism even if the movement towards something better has currently stalled.

But the extension of the ‘democratic sector’ - including the important ‘subset’ of the public sector -remains important despite being at odds with the prevailing Ideology.  By ‘the democratic sector’ we refer not only to the traditional public sector, but also to a multiplicity of co-operative and mutualist forms, as well as democratic collective capital formation and other like-projects, as well as self-employment and co-determination.  These democratic economic forms and strategies can mitigate or indeed end instances of alienation and exploitation.  They can result in a more equitable distribution of wealth and the power that corresponds to this; and also give working people creative control over their labours.  

Efficiencies and reduction of cost-structures through natural public monopolies can also be capitalised upon – flowing on to the private sector and making better wages and conditions, and more progressive corporate taxation sustainable.  For instance: did we really ever need two sets of mobile telephony infrastructure?  And what price are we still paying for that duplication?  Indeed, ‘competition’ in areas such as energy, transport and communications infrastructure, water – are still deeply ‘anti-intuitive’, wasteful and unnecessary.  Hence it is possible to add to the current capitalism’s survivability while laying foundation stones for something better ‘long term’. 

An extended public sector specifically can lead to many other desirable outcomes.  Socialisation of profits via public enterprises in areas like mining, general insurance, private health insurance and banking could (in the Australian context) deliver tens of billions into welfare, infrastructure and social wage programs.  And a ‘not-for-profit’ footing could enable better pay and conditions for child care and other professionals who currently face extreme exploitation. Without getting into a long debate over the labour theory of value – public sector workers could be compensated fairly – but profits would be redistributed through the social wage, investment in infrastructure and services, and in welfare.  There would be no expropriation of surplus value, here, in the traditional capitalist sense. Though the redistribution of profits could appear to some to be diluting the return to labour. (that would not be a problem for some forms of co-operative enterprise for instance)  Government Business Enterprises and public infrastructure could also be administered in such a way as to cross-subsidise in favour of the disadvantaged ; but also to enhance competition where oligopolistic collusion would otherwise be a threat.

So indeed there are many arguments in favour of an extended public sector as part of a broader project of a ‘democratic mixed economy’.   Contra-Luke Foley - Let’s defend the Socialist Objective.  But let’s not dilute it to the point where it becomes merely token or symbolic.  Indeed let’s try and improve the Objective to make clear our aspirations for a democratic mixed economy; an expanded welfare state; a reformed tax mix and an expanded social wage.  Yet as against Kim Carr’s aversion to an ‘extensive’ public sector, strategic expansion of the public sector remains important and valid, as does the spread of other democratic forms – such as co-operative enterprise – with assistance via State Aid.  Indeed, these together could comprise a ‘multi-pronged strategy’: a long-awaited Left counter-offensive against the dominant neo-liberalism.

Both neo-liberalism and the old ‘Communism’ have demonstrably failed.  We need to reject the prevailing intellectual fetish for ‘undistorted’ markets, privatisation and small government and return to the question of a democratic mixed economy with an open mind.

Nb: Several other essays on the theme of a ‘democratic mixed economy’ can be found here:

http://democraticmixedeconomy.blogspot.com.au/2013/10/what-is-democratic-mixed-economy.html