Joe Hockey shows how “Class Warfare against the Vulnerable” is done

 

 

Joe Hockey is promoting a 'Social Civil War' - pitting even low wage workers as well as the well off and the middle class against the welfare-dependent.   In response to this regressive campaign, Labor cannot accept the Liberals' 'terms of debate' but must propose its own policy agenda for just and socially fair Australia.

nb:an Apology to 'The Australia Institute'; In a typo I accidentally referred to that left-wing think tank when I should have referred to the right-wing 'Sydney Institute'. The typo has been corrected.

Tristan Ewins

Australian Treasurer Joe Hockey has been “on the attack” recently; targeting Australians who for whatever reason have been welfare-dependent, or have benefited from welfare during their lives.  Specifically, Hockey asserted that one in ten Australians were welfare-dependent in some way, with a total welfare bill of $146 billion a year in a $1.6 Trillion economy. 

Apparently, this is meant to produce a ‘shock and horror’ effect amongst an electorate which is considered to be ‘narrowly self-interested’, without any sense of social solidarity, or of the gains to be had through such reciprocal solidarity and also the various forms of collective consumption.

Interestingly, though, Minister for Social Services, Kevin Andrews himself has observed that cash payments in Australia comprise around 7 per cent of GDP, compared with approximately 19 per cent in France; and approximately 14 per cent in Sweden!  Though in Denmark, for instance, there is a much more substantial social wage, with social expenditure at approximately 31 per cent of GDP compared with approximately 19 per cent in Australia.  (also approximately 33 per cent in France,  and approximately 29 per cent in Sweden)

More particularly Hockey has alluded to those dependent of Youth Allowance,  Newstart, the Aged or (military) Service Pension, and the Disability Support Pension.   Apparently in an attempt to stir up division and resentment, Hockey argued that “the average Australian”, whether “a cleaner, a plumber or a teacher” works over a month every year to provide for the nation’s welfare bill. (Herald-Sun, June 12^th, 2014, p3)   This ‘political play’ to narrow financial self-interest ignores the benefits of reciprocal social solidarity via welfare.

Meanwhile in a speech to the right-wing Sydney Institute Hockey launched into a tirade against those he describes as “leaners” as opposed to “lifters”.   For Hockey it is claims that the wealthy must ‘pay their fair share’ that comprise ‘class warfare’; and not the Federal Government’s attacks on welfare, as well as their assaults on Medicare and rights and conditions for labour.  Rather than ‘social solidarity’ Hockey proclaims ‘individual responsibility’. (ie:  ‘sink or swim’)   

In an infuriating furphy, Hockey promoted his personal interpretation of “equal opportunity” as opposed to the ‘straw-man’ of “equality of outcomes”.    On this basis he also attempted to defend the Federal Government’s Higher Education ‘reforms’ – which will see a fee deregulation (some of the highest fees probably reaching well over $100,000), as well as a reduction in the repayment threshold for student loans, and also an increase in the rate of interest paid on those outstanding loans.  (‘The Age’, June 13^th, 2014, p 8)  This will affect women - whose working lives are often interrupted.  

In the same vein, there will be those with significant university debts who for various reasons (eg: disability) may not be able to continue their pursuit of a career in law, medicine etc.  These peoples' university debts could easily spiral way out of control. The element of ‘risk’ here means that many young students from disadvantaged backgrounds will not dare to take on a university debt.  Those that do also may be distracted from gaining their most from study because of the necessity for part-time work.  And ‘equality of opportunity’ in this context is a lie: because those students tend to be concentrated in lower socio-economic zones, with relatively under-resourced schools.   (they may also lack the support of parents who have enjoyed a tertiary education)

In response to Hockey one of the most important of his assertions to deal with is that ‘straw-man’ argument of ‘Equality of Outcome OR Equality of Opportunity’.    Instead of this false dichotomy it is much better to frame the issue as a matter of Fairness.  Pretty much no-one – even on the far Left – want full ‘equality of outcomes’.   Rather there is support for redistribution via the social wage, welfare state, social wage, and forms of social insurance for the sake of distributive justice. (as opposed to full equality)  ‘Equality opportunity’ is part of the picture; but so too are ‘fair outcomes’.

Here, ‘distributive justice’ assumes that the outcomes gained in the labour market through ‘supply and demand’ of skills – and ‘consumers’ capacity to pay’ are not necessarily just.   For cleaners, as well as hospitality, child care, and aged care workers – people whose work deserves respect –there is an argument for intervention and redistribution as the means of achieving fairness.   (not absolute equality)   Those measures of redistribution – through the social wage, tax-transfer system,  welfare state, labour market regulation - do not have to put the remuneration of a cleaner ‘on par’ with a surgeon, for instance.  But all workers who face disadvantage and injustice in the labour market deserve fair outcomes; and those means of intervention are effective means of providing those fairer outcomes.

Arguably Joe Hockey is is attempting to ‘divide and rule’ the nation.  An element of divison is inevitable – perhaps even desirable – in a democracy.  The point of democracy after all is ‘to set oppositions free’ and resolve them through democratic processes. 

But Hockey is inciting resentment against the vulnerable – no matter what he has said to the contrary.   This is qualitatively different than attempts to tax the wealthy – which Australia’s Conservatives try and dismiss with hypocritical howls of ‘class warfare’.

More specifically, Hockey’s approach comprises a ‘bold gambit’.  Low-income workers themselves are to be ‘played off against’ the welfare dependent. Rather than raising minimum wages and conditions, or improving the social wage – they are urged to express resentment against the vulnerable.  The ‘endgame’ is a US-style class system.  The very wealthy are to be ‘untouchable’ and largely untaxed lest we be bombarded with cries of ‘class warfare’.   Taxes are to be ‘simpler’ and ‘flatter’ – that is, more unfair. The middle class are to provide ‘the base of stability’ for Conservative political forces: their lifestyles supported by the exploitation of the working poor. And the working poor – indeed, the ‘underclass’ - are to be ‘disciplined’ by fear of homelessness and destitution – with the erosion of the ‘social safety net’. 

Crime will also likely escalate as a consequence of desperate inequality; but this insight is to be ignored for the sake of a warped, and ultimately immoral, notion of ‘meritocracy’.  How this ‘meritocracy’ is meant to work without real equality of opportunity (especially education); while there is ‘hyper-exploitation’ of the working poor; and amidst ‘windfall’ inheritances in the most privileged families - is not really considered by today’s Conservative Ideologues.  It is ‘an inconvenient truth’.

In Hockey’s ‘grand statement’ to the ‘Sydney Institute’ those designated as ‘leaners’ are to be reviled.  There are Aged Pensioners. (who have largely paid taxes their whole working lives)  And yet no mention of self-funded retirees – whose liquid assets alone can range well over a $1 million – but who receive enormous superannuation tax concessions.  The total bill of those concessions will soon cost the nation over  $40 billion a year. As Richard Denniss of the Australia Institute observes:   "the top 5 per cent of income earners get a third of the benefit, and the bottom 20 per cent get literally nothing."

Then there are the disabled. Underlying resentment against Disability Support Pensions is the notion, for instance, that ‘mental illness’ is not to be seen in the same way as ‘extreme physical disability’.  We’re talking about people with anxiety disorders, depression, schizophrenia, bipolar disorder...   Something Andrew Robb could probably advise the Parliamentary Liberal Party about: and yet from a cursory web-search he does not appear to have done so. 

Often the ability of these disability pensioners to work is intermittent at best.    And the underlying assumption that they are to be looked upon suspiciously – as ‘rorters’.   Hence ‘Disabilitywatch’ has noted moves by the Federal Government to ‘tighten up’ assessment for eligibility, including ‘work for the pension’ for those deemed able to work at least 8 hours a week.  (now to be reduced from 15 hours a week)   But arguably if a person is living in poverty due to disability, and may be capable (intermittently) of some work, then perhaps their payments could be complemented fairly in return for voluntary community work, without the threat of losing that pension altogether.  Instead we are getting another dose of labour conscription – this time for some of the most vulnerable of all.

In conclusion: a movement is building against Hockey’s ‘Robin Hood in Reverse’ Budget.  In Melbourne the day before this article was written the ‘Bust the Budget’ rally amassed around 20,000 attendees – perhaps more.  The ‘Your Rights at Work’ campaign against John Howard’s aggressively in egalitarian ‘Work Choices’ labour market legislation attracted the support of millions.  Today the same is possible if we stand collectively against Hockey’s cynical ploy to ‘divide and rule’ the country.

Yet Opposition Labor Party leader Bill Shorten is ‘treading lightly’ around Joe Hockey’s appeal to divide the nation – a ‘nation at war with itself’; a war of so-called ‘lifters’ against so-called ‘leaners’. So far he refuses to reject this characterisation of Australian society outright.

But Labor cannot accept a political discourse which is propagated on the Liberals’ terms.  Labor needs to respond to Hockey with its own powerful narrative:  of a society based on mutual and reciprocal social solidarity.  This means promoting social security and social justice through a range of measures including labour market regulation, welfare, a progressive tax mix, the social wage, and various forms of ‘collective consumption’.  Not a society of ‘absolute equality of outcomes’ – but a FAIR and JUST society!

In a practical sense that must mean a decisive break on the part of Labor with the mindset of ‘small government’.  Labor must ‘go on the policy offensive’: advocating both old and new policies.  That includes Gonski and the National Disability Insurance Scheme.  But it must also include National Aged Care Insurance and Comprehensive Medicare Dental, amongst range of other policies.   The way is open for a progressive counter-offensive mobilising millions.  Labor, the unions, the welfare sector, and all progressive social movements - must seize the initiative.

Leadership Speculation Again: Resolving the Crisis with Good Policy

 

above: With a possible Abbott government looming, Labor needs a clearer sense of where the real threat is coming from;  Tristan Ewins argues that Reconciliation is necessary now if there is to be any hope; And robust policy could be the key!

Tristan Ewins, June 23rd 2013

Regarding ongoing leadership speculation in the ALP: What we have witnessed has been a ‘mutual scorched earth policy’  in the party and the caucus.  We’ve had some figures (Rudd supporters apparently) leaking constantly to the media; and even accusing Gillard of ‘class war rhetoric’.  And on the other side we’ve had high profile Ministers besmirching Rudd’s character and saying they would NEVER work under him again.  In short it is “mutually assured political destruction’: “political scorched earth”…

The ridiculous and self-destructive ‘class warfare’ claims of some have been particularly damaging  – as this has acted to discredit the social democratic and labour cause – the ideology and the principle of socially just redistribution and the liberal and social rights of labour…

The bad blood is now SO bad that I despair the party might never heal…  What is necessary for hope of healing is to have such a powerful policy agenda that it serves as an irresistible catalyst to re-establish solidarity. 

This could involve reform of the mining tax. Regardless of his flaws: even if Rudd does not return to the leadership this could be a kind of ‘vindication’ for posterity.   That could create an environment where all parties could ‘move on’ on the basis on conciliation…   This could also involve clear and public recognition that he provided strong political leadership in response to the Global Financial Crisis, with the Education Revolution   and with the Apology.  For this both  Rudd and the broader party deserve recognition.   Unequivocal recognition of these achievements specifically could do a great deal in achieving healing.

But MOST IMPORTANTLY: Labor needs to revisit the issue of superannuation concessions to fund a strong social wage and social insurance agenda.  A progressive agenda of ‘Whitlamite proportions’ could also be a healing influence – with all parties seeing that with so much at stake their consciences would not allow the currently mutual sabotage and ‘scorched earth’ approaches  to continue.... 

What more could all this entail?  

Firstly it should involve superannuation concession reform – aimed at building in a progressive and sustainable manner a powerful ‘war-chest’ for an ambitious social wage and social insurance agenda.  And a reversion to 75% - or perhaps  50% - dividend imputation – could also provide crucial funds.

So precisely which other policies would this war-chest fund?  The following are a number of ideas which the author remains passionately committed to.

·         National Aged Care Insurance providing for the human rights of all aged Australians; and funding that progressively without driving poor and working class families to sell their only substantial assets for what is inadequate care in any case.

 

·         More robust funding for mental health initiatives, including public education programs to address stigma and encourage early intervention; and access to psychological counselling.

 

·         Extensive Cost of Living Assistance for low income individuals and families including pensioners when it comes to energy, communications, transport, medicine and water. Furthermore: Public energy and water ownership can mean cross-subsidy rather than passing the prices indiscriminately on to consumers.  And more federal funding for transport and energy infrastructure could prevent reversion to wasteful and expensive PPPs – or worse, fully private infrastructure.

 

·         A commitment to keep the NBN public over the long term with cross-subsidised services for poor and vulnerable groups.

 

·         Sustained support for Australian manufacturing and the liberal and social rights of labour- including encouragement for high wage, high skill manufacturing

 

·         Welfare reform: especially of Newstart and the Student Allowance.  And Revision of eligibility criteria for the Disability Pension – which have become too narrow and which serve to discriminate against genuinely disadvantaged and vulnerable people. 

 

·         Tax compensation through restructure of the tax mix for low income Australian workers so that they will not be worse off re: their disposable income ‘living week to week’ when superannuation contributions rise to 12% 

 

·         Direct public compensation/subsidy  for skilled but low income workers – eg: in child care; and further reform of the tax mix to aid other low income workers. 

 

·         Federal money for public housing to take pressure from the housing market; And provide education funding of the scope originally envisaged in Gonski. 

 

·         A rescission of bad and unpopular decisions on university funding and sole parents.

 

·         Further reform of the National Curriculum to promote a liberal education agenda for active and informed citizenship, including ideological and political literacy

 

·         Begin a genuine consultation process leading towards a Treaty with Indigenous peoples

 

·         stamp duty relief targeted for low income individuals and families – so they are free to move to cheaper accommodation without having to pay the tax. For some people that could make a real difference.

Indeed, there are probably a host of other possibilities – but depending on the scope of tax and superannuation reform we would be talking an annual war-chest  for new initiatives of $10-$25 billion in an economy worth about $1.6 Trillion.

Regarding the leadership: there are substantial numbers of Labor parliamentarians, functionaries and rank and file who probably think that they want to set a precedent.  Neither side wants ‘to give in to blackmail’ – but both sides are playing the ‘political scorched earth’ game.

It has to stop – and it has to stop now.

Calls for direct election of the Party Leader could well be a good move for the future – to provide a degree of authority surpassed only by the Conference itself.

Time is of the essence; and the threat of a right-wing neo-Conservative Abbott government far too dire.  “Mutually Assured Political Destruction”; “Political Scorched Earth” – it has to stop now.

And more than leadership – regardless of what happens on that front – the key is a policy agenda to unite the party; recognise past wrongs on all sides; and resolve never to repeat those errors again.

(postscript)  All that said it's important that yesterday 'The Age' in Melbourne was arguing for Julia Gillard to step down so there can be a change of focus to policy and ideas and away from the leadership. It shouldn't HAVE to be like this. We have been trying to put policies out there for MONTHS which have largely been ignored in the monopoly mass media. (including 'The Age' itself for a while) 

So what are our choices? Concerted destabilization during an election campaign and in the face of a prospective Abbott government cannot be rewarded. But there needs to be recognition of past wrongs – and open and emphatic recognition of the earlier place of Rudd in ALP history - re: the GFC, the education revolution and the apology...  This could help in restoring peace and good-will. But what if the media won't let the leadership issue go? And what if the destabilisation continues right up to the election in any case?

So what else could work as a 'political circuit breaker' without setting the bad precedent of rewarding systemic destabilisation? As suggested above a more robust policy agenda could provide an answer.  (you would think this would win over progressive Left parliamentarians including Cameron and Carr)  And some will be considering a ‘third option’ of an untested leader to break the impasse. Possibly the destabilisers might be satisfied with the 'precedent' this would set with regards the original 'coup' against Rudd in 2010.  But would this be seen as a ‘poison chalice’? And would it create the impression of more instability?  Whatever happens – all this needs to be finalised quickly. Labor needs to throw itself into the campaign unreservedly and cannot afford the constant distraction of the leadership as opposed to policy.

Sincere and constructive debate welcome!