Is Australia becoming ungovernable?

As we approach the end of a tumultuous year in federal and state politics and face no let-up in 2011, and consequent upon the arrival of the ‘hung parliament’ in Canberra, the question that demands an answer is how can this country be governed given the attitudes that now exist among voters, politicians, the media, power brokers and those who seek to influence political outcomes?

Any observer of contemporary politics, no matter how dedicated to the need for nation building and reform, would be forced to ask whether entering politics as a parliamentarian is the way to achieve this, whether the political process is still capable of bringing about the needed changes, whether the conflicting forces in the electorate and in our political parties make meaningful change possible at all. Although this may sound nihilistic, if the dilemma continues for politicians where they have to choose between legislating the changes needed or surviving politically, reform and nation building will slow or come to a stop.

This situation has not arisen because we now have a minority federal Government – indeed this is the outcome of a steadily growing disillusionment with the political process, which in turn has its genesis in the conflicts that exist in the electorate that push politicians this way and that, where it is impossible to satisfy all the demands, all the pressure groups, all the voters, no matter which way political parties turn. Have governments an impossible task?

This piece attempts to tease out the factors that seem to be responsible for this state of affairs. It draws substantially on George Megalogenis’s Quarterly Essay: Trivial Pursuit: Leadership and the end of the Reform Era, which was summarized on The Australian website on 20 September in an article titled Greening of the Nation, and amplified in the Wheeler Centre discussion of the Essay moderated by Lindsay Tanner that can be viewed on a video at the end of Greg Jericho’s 25 September piece on Grog’s Gamut: On the QT and now the end is near. This thirty-minute video is well worth the time needed to view it. Megalogenis is a reliable and respected journalist who uses poll statistics to make sound political points. What he has to say deserves careful reflection.

Here are some of the factors that, in my view, contribute to the growing difficulties facing governments that are attempting a reform agenda. They may not be unique or even of recent origin, but their omnipresence ought to be of concern to us, as indeed they seem to be to Megalogenis who has used his Essay to address some of them.

Lies, deception, slogans and mantras
What the electorate thinks about a government and any piece of legislation it attempts is now of crucial importance. If the majority disapproves of a proposed reform it puts pressure on the government to abandon it or water it down. Because the electorate can make proper judgements only when it is in possession of the relevant facts, all of them, the promulgation of accurate and complete information is essential.

Yet lies, deception, slogans and mantras, perpetrated every day, obstruct the process of informing the voters. A piece on this appeared recently on The Political Sword. How can a government govern properly if the feedback it receives from the community, usually in the form of polls and focus groups, is distorted by dangerous untruths?

We have seen this starkly illustrated in recent times. After the toppling of Malcolm Turnbull by Tony Abbott, the Federal Opposition not only abandoned its promised support for the Rudd Government’s ETS, it decided to trenchantly oppose it. Not satisfied with arguing its case with facts and logical reasoning, it began a campaign of distortions of the truth with its GBNT slogan and Barnaby Joyce’s fairy-tale: ‘every time you go to the fridge, every time you do the ironing you’ll be paying Rudd’s great big new tax’. Despite the generous reimbursement built into the ETS to compensate householders for the inevitable rise in electricity costs with the ETS, this was never mentioned by the Opposition, only the cost rises were highlighted – the GBNT . As the Government seemed incapable of countering this, the myth was quickly established, and adverse focus group and internal polling feedback so terrified Labor powerbrokers that, fearful of a severe electoral backlash, they insisted the ETS be postponed until the end of 2012, a move that many believe started the slide in Kevin Rudd’s popularity from the stratospheric heights he had enjoyed for so long, his later removal as an electoral liability, and the eventual near loss of Government by Labor.

The power of lies, deception, slogans and mantras was searingly illustrated by this episode. Truth was irrelevant – perception was all that mattered. How can a government bring about a reform of the magnitude of the ETS when the truth was overwhelmed by mendacity? How can a government govern in the fact of such deceit?

Focus groups and polls
There is now an abundance of organizations that provide political organizations with feedback from focus groups and polls. Some provide data for the public; others provide it privately. Political parties seem to rely more and more on this feedback to fashion their policies and their strategies. The Rudd Government, and particularly its apparatchiks, seemed wedded to their outpourings and used them to modify policy or even change direction. We saw this with the ETS and with the asylum seeker issue. Focus groups and internal polling in the Western suburbs of Sydney revealed what a hot-button issue asylum seekers was in those areas where there is already a superfluity of Muslims and where infrastructure had failed to keep up with the burgeoning population, leading to congested travel and inadequate services. It was this feedback that persuaded Julia Gillard that she had to take a different line on the boat people issue, to look tougher and to reduce as a political issue the arrival of more and more boats.

George Megalogenis comments that numbers resonate with politicians and their advisers, and that if polling is done on an issue and the people approve, the Government is reassured, but if second time around the result is less favourable, the media is soon saying: ‘the Government is in trouble’ on the issue.

Given that focus groups and polls have so much influence on political thought and action, two questions need an answer. First, how valid and reliable are they? How carefully and scientifically are the questions framed? How thoroughly are the outputs analysed and the statistics interpreted? We know that pollsters can fashion questions that evoke the answer they want. There have been some glaring examples of this in public polls. Invalid or unreliable polls are not only useless; they are dangerously misleading. I use those words with their scientific meaning: validity means that the poll actually measures what it purports to measure, and reliability means that it measures those aspects consistently, so that the poll, if repeated with the same group at a short interval, would produce the same result.

The second, and more important question though is the extent to which political parties ought to rely on them in creating or modifying policy. Everyone would agree that listening to what the public thinks and wants is essential in politics, but how slavishly should politicians follow what the people say, especially when what they say varies from place to place and from time to time? How much should politicians be blown about in the breeze, or to use an expression applied to Tony Abbott, be weathervanes? Is there not a time for politicians and parties to say – we have done all the research that is necessary to determine our policy and we intend to stick by our decision?

In developing public policy, a sound review backed by valid research that establishes the need for the policy and the ways it could be implemented, accompanied by consultation with all the stakeholders, ought to provide the background for framing the legislation. After testing it among key stakeholders for flaws, it should be ready for debate in the House. If that thorough process is followed, any government ought to be able to stick to its guns and press on with the legislation whatever the focus groups and polls dredge up. This process was followed with the Rudd Government’s ETS, starting with the Garnaut review and progressing through Green and White papers to the actual legislation, only to be changed after rejection by the Opposition and when polling suggested a fall in public enthusiasm for it after the GBNT slogan began to bite and after business opponents began insisting on concessions, until it was finally postponed. It is now conventional wisdom that that change of tack, that abandonment of what was seen as a core belief and a matter of principle, was very damaging to the Government.

The point that flows from this is that on such important matters of principle governments ought not to retreat in the face of public opposition. The public may complain, as they did about the introduction of the GST and rail about it in the polls, but once in place it soon became accepted as the norm, and John Howard was seen as ‘standing for something’. Governments need to have and to show the courage of their convictions despite public opinion; eventually they will be admired for it. To do the opposite evokes scorn.

Australia will be come ungovernable if governments bend this way and that every time public opinion is whipped up in opposition.

The selfish electorate gene
There seems little doubt that self-interest governs the opinions expressed by most of the electorate. Even accepting that there are still some altruistic enough to be more concerned with the public good than their own self-interest, the vast majority take the ‘what’s in it for me’ approach; or exhibit the NIMBY attitude; or take the view that ‘I’m all for it so long as it won’t cost me’, as was the case with the ETS; or ask ‘who’s offering the most for me, my family, my community, my town, my state?’ The latter may be not unreasonable unless it runs contrary to the national interest. The MRRT is an example. If one can judge from voting patterns, it was only the min ing states that were vehemently opposed, and their opposition almost cost Labor government. Other states could see the advantage to the whole community if fairer taxes were levied from the mining sector – more revenue for infrastructure, as well as lower company tax and better superannuation. The mining states were persuaded that the threat of mine closures and consequent job losses, a story shouted in TV and newspaper ads, was more compelling to them than the national good.

The self-interest of individuals or groups can never be a satisfactory basis for political decision-making. Good governance demands that all the pros and cons of any policy be weighed and that decisions are made for the greater good, rather than in favour of the most powerful, the most well heeled, the most loquacious, the most heart-tugging advocates.

How can governments govern for all when pressured by overwhelming self-interest? How can governments establish priorities for funding when everyone wants everything for themselves and the devil take the rest?

Lobbyists and pressure groups
These exhibit the selfish electorate gene more flagrantly than do individuals. They represent a defined constituency and advocate on its behalf. They are not concerned with any other constituency or for that matter with the national good. They do not ask, ‘if I get all I want for my constituency, who will suffer, what other programs or initiatives will receive inadequate funding?’ For lobbyists representing commercial interests, it is understandable that they are unconcerned with the needs of others; they come from a ‘dog eat dog’ world. But with other groups within the same sector one might expect some concern about how their demands might impact on others. For example when the mental health lobby makes its compelling case for more funds, particularly for the young, no matter how laudable, does it reflect on how full funding of its request might affect funding for disability care, or for emergency care, or for hospital beds? If so, we hear none of it.

There is a more sinister aspect to pressure groups – the way they threaten politicians with electoral damage if their demands are not met. Two recent examples will suffice. The sector of the union movement pressing for equal pay for women, a laudable objective, threatened Julia Gillard with an electoral backlash from unions if she did not support equal pay. Despite her indicating that this was her goal but the current budgetary situation did not permit a rapid move to equal pay, the threat continued. The Christian lobby threatened Gillard with electoral pain from Christian groups if she personally supported same sex marriage; angry as they were that such a debate was on the agenda at all. Moreover, when a government is suspected of being weak, lobby groups feel they can use stand-over tactics to get their way.

The media
As if it is not enough for the Government to have to counter the disingenuousness of the Opposition and the falsehoods they spread with abandon, a large section of the media are complicit in spreading the deception, particularly News Limited outlets and especially The Australian, whose editor has declared that paper to be a conservative one, and has authorized or allowed countless condemnatory articles aimed at the Rudd/Gillard Governments.

If the media was evenhanded and challenged the veracity of the statements the Opposition makes in the same way it challenges the Government’s, what filtered to the public would at least be balanced and fair, and thereby give the electorate the chance to make up its mind on facts rather than fiction. But that is not the way the media operates. Even our ABC fails the test of balance. If you don’t accept this, read the transcripts of Lyndal Curtis’ interviews last week on AM with Tony Abbott and Julia Gillard: Abbott attacks 'do nothing' Government and Gillard trumpets broadband deal. Even the headlines paint the picture. Make up your own mind.

Megalogenis highlights the influence that talkback radio has had, not just on the listeners, but on the rest of the media, which he said felt it ‘had to shout like Alan Jones’. The influence of talkback is immense, and the politicians know it. Tony Abbott knows he can get a good run from the likes of Alan Jones with lots of Dorothy Dixers. He knows too that he can get surrogate support from Jones as he did over the charges laid by a female prosecutor against some Australian servicemen in Afghanistan. Jones used extravagant language to condemn her; Abbott felt he needed to say nothing because Jones was doing his condemnatory work for him.

How can the Government govern this country if disinformation is spread day after day by talkback radio as well as by much of the rest of the media? How can any government get the support it needs to govern effectively if the media is tearing it down incessantly as, for example The Australian did over the HIP, the BER, the Stimulus Program, and is now doing over the NBN? Has the media made Australia almost ungovernable? Megalogenis agrees that the media is making it harder for the Government to do its work. He insists it is not the journalists’ fault – they are swept along by the plethora of media and the 24-hour cycle that needs incessant feeding, and which he says ‘can create a lot of distraction, a lot of noise, and hound a politician out of a position previously taken, making it difficult for the Government to govern with authority’.

So can contemporary governments govern this country? It seems to be becoming harder and harder given the irresistible forces that bear down upon politicians and political parties. The distortions of the truth that are perpetuated by politicians and echoed by the media, the pressure groups that try to muscle the Government to move their way and threaten them if they don’t, the over reliance of political parties on focus groups and polls and their readiness to bend to their influence, the conflict that seems to exist between being courageous enough to take on and carry out tough reform, and saving political skin, and the selfish electorate gene that puts self-interest above the common good, have all contributed to a loss of potency of politicians to effect reform. Like George Megalogenis I fear we may be facing the end of the reform era unless the forces that have made this country less and less governable can be overcome and reversed. That is a big ask.

What do you think?

What does Julia Gillard stand for?

Here we go again. It doesn’t seem all that long ago that the same question was being asked about Kevin Rudd. It seems this type of question occurs cyclically when the punditry becomes bored with the pace of political activity. But what does the question mean?

There are several journalists who enjoy asking this question, sometimes via a variant: ‘What is Julia Gillard’s (or Kevin Rudd’s, or Labor’s) ‘narrative’? Paul Kelly, who carries the not-to-complimentary nickname ‘Polonius’, is one who has sufficient gravitas to ask this question. Lesser lights from the News Limited stable such as Dennis Shanahan and Matthew Franklin try it on, but to slighter effect, and minions like Glenn Milne seem ridiculous doing so. Those who try though should at least have some idea of what the answer might be, and not just parrot what sounds like a tired political slogan. Lightweight journalists refer to it as ‘the vision thing’, for want of something more descriptive. Some insist on ‘an agenda’ or ‘a plan’. Crikey’s Bernard Keane asserts that Labor is ‘bereft of direction’ and facing ‘an identity crisis’. No supporting evidence is advanced – we are expected to take what he says for granted.

There’s been previous comment on The Political Sword on this subject: In Search of the Political Holy Grail on September 14, 2008, and in The Enigma of Leadership on August 15, 2010 in which an attempt was made to spell out what Labor appeared to stand for. 

I don’t recall anyone persistently demanding an answer to: ‘What is Tony Abbott’s narrative?’ or ‘What is his plan?’ or ‘What does Tony Abbott stand for?’ or ‘What does the Coalition stand for? But of course those in Opposition are excused such impertinent questions – after all they are not the Government. So let’s begin by searching for what the Coalition does stand for, what its narrative is.

All through the election campaign were heard from Tony Abbott little else than his three-word slogans: ‘end the waste’, ‘pay back debt’, ‘stop new taxes’ and ‘stop the boats’. Is this what he and the Coalition stand for; is this its ‘narrative’? The slogans were simple to understand, and no doubt appealed to many voters, by how well did they give them an idea of the alternative government’s vision? How many said ‘I’m voting Coalition because of its stunning vision, its powerful narrative that it will end the waste, pay back debt, stop new taxes and stop the boats’? Perhaps more than we like to think! In fairness to the Coalition, it has affirmed its advocacy of free markets, small government, personal enterprise, small business, self-sufficiency and reward for endeavour, although we heard little of this in its campaigning. So is this its vision, its narrative, what it stands for? I suppose it must be, even though it doesn’t make much of a feature of it. Commentators seem not to have latched onto it, or care much about it, despite the fact that the Coalition might have become the government at the time of the recent election.

What I’m getting at here is that despite recurrent pleas to politicians from the commentariat for a narrative, the ‘vision thing’, what they ‘stand for’, the response never seems to satisfy them, or even impinge on their consciousness. So what do they want?

Are they looking for Ben Chifley’s 1949 ‘Light on the Hill’ address to the Labour Conference? Read it here.  The relevant paragraphs read: “I try to think of the Labour movement, not as putting an extra sixpence into somebody’s pocket, or making somebody Prime Minister or Premier, but as a movement bringing something better to the people, better standards of living, greater happiness to the mass of the people. We have a great objective – the light on the hill – which we aim to reach by working for the betterment of mankind not only here but anywhere we may give a helping hand. If it were not for that, the Labour movement would not be worth fighting for. If the movement can make someone more comfortable, give to some father or mother a greater feeling of security for their children, a feeling that if a depression comes there will be work, that the government is striving its hardest to do its best, then the Labour movement will be completely justified.” Did that satisfy the journalists of that era? Would it have done so today?

So what has Julia Gillard given us in the way of vision? What is her narrative, what are her values, what is her ‘light on the hill’?

In her acceptance speech on first becoming PM back in June she said: “I grew up in a home of hardworking parents. They taught me the value of hard work. They taught me the value of respect. They taught me the value of doing your bit for the community.  And it is these values that will guide me as Australia’s Prime Minister.  I believe in a Government that rewards those who work the hardest, not those who complain the loudest. I believe in a Government that rewards those who, day in and day out, work in our factories and on our farms, in our mines and in our mills, in our classrooms and in our hospitals, that rewards that hard work, decency and effort. The people who play by the rules, set their alarms early, get their kids off to school, stand by their neighbours and love their country. And I also believe that ‘leadership’ is about the authority that grows from mutual respect shared by colleagues, from team work and from hard work, team work and spirit.”

Later in that speech she said: “And today I can assure every Australian that their Budget will be back in surplus in 2013.  So, having seen the global financial crisis and how our nation has responded, it has reinforced in me my belief that when this nation pulls together, we can do great things.  It is my intention to lead a Government that uses that spirit and that will to do even more to harness the talents of all of our people.  To do even more to make sure that every child gets a fair go in life and a great education.

“It is my intention to lead a Government that does more to harness the wind and the sun and the new emerging technologies.  I will do this because I believe in climate change. I believe human beings contribute to climate change. And it is as disappointing to me as it is to millions of Australians that we do not have a price on carbon.  And in the future we will need one. But first we will need to establish a community consensus for action. If elected as Prime Minister I will re-prosecute the case for a carbon price at home and abroad. I will do that as global economic conditions improve and as our economy continues to strengthen. 

“There is another question on which I will seek consensus and that is the proposed Resources Super Profits Tax. Australians are entitled to a fairer share of our inheritance, the mineral wealth that lies in our grounds. They are entitled to that fairer share. But to reach a consensus, we need do more than consult. We need to negotiate. And we must end this uncertainty, which is not good for this nation.”
  There was much more.

Does any of that resemble a narrative, a vision, what she stands for, her values? If not, what more do the pundits want?

Take a look at Gillard’s speech at her campaign launch?  Any sign of vision there, any semblance of narrative, any notion of what she stands for?

What did she say at her National Press Club address on July 15?  Among many other things she said: “Today, guided by my values, I want to share with you how I intend to move Australia forward to a stronger economy, with sustainable growth that delivers for hard-working Australians. I believe that prudent and disciplined economic management is the foundation of good government. The good-quality, essential services that Australians expect can only be sustained by a Government when our public finances are sound. That’s why I believe in strong budget surpluses. The Government I lead will return the budget to surplus in just three years’ time. As the Treasurer announced yesterday, we are now on track for a surplus of more than 3 billion dollars in 2013…

“I also believe that to maximise jobs today and tomorrow, governments must be a force for confidence and certainty in the economy. That is why I moved immediately to end the uncertainty in the mining industry and mining communities across Australia, and that’s why I can say with confidence that a re-elected Gillard Government will cut company tax, give small business an extra helping hand, invest in infrastructure and increase national savings and retirement incomes for hardworking Australians through our support for increased superannuation – more balanced economic development that is good for jobs right around the country and good for national savings…

“We must do the hard work of building an economy with higher productivity growth and higher workforce participation – the long-term drivers of future prosperity…

“I will make education central to my economic agenda because of the role it plays in developing the skills that lead to rewarding and satisfying work – and that can build a high-productivity, high-participation economy…

“The sectors which may need renewal and reform are often those that were relatively untouched by the Hawke-Keating reforms – sectors like health and education that meet essential public needs, delivered largely within the domestic economy. Hospitals, aged care facilities, childcare centres, schools, and employment services – all services with a diverse range of providers from the public, private and non-government sectors, and services where competition and value is often held back by jurisdictional red tape and the lack of seamless national markets.”

Can you detect any sign there of a vision, a narrative, an agenda, a plan?

Even as recently in Question Time this past week, in response to a question to her from Tony Abbott: "Does she agree with former Labor minister Graham Richardson that the Government has no agenda and no plan?” she answered: “I say in answer to the question from the Leader of the Opposition: would it not strike Australians as strange that, in a world where there are so many challenges – how do we keep our economy strong and how do we ready our economy for the future? How do we tackle climate change? How do we make sure that every child in this country gets a great quality education and how do we make sure we have the healthcare services that Australians deserve not only today but in 10, 20 and 30 years time as our society ages? How do we make sure that we have world-class infrastructure right around the country? How do we make sure that we have balanced growth in an economy where our resources sector is obviously going so strong but things like the high dollar are impacting on other industries and other parts of the country? How do we reconcile and improve the prospects and life expectancy of Indigenous Australians; how do we close the gap? How do we as a world deal with the challenges of food security, development and freer trade? In the face of all these challenges, that the Leader of the Opposition would come into this place and use the precious minutes of question time to yet again play politics – we do not expect anything more from a man whose entire philosophy can be reduced to a few three-word slogans.”

So how much more ‘vision’, ‘narrative’, ‘what she stands for’, ‘plans’, ‘agenda’ and ‘direction’ do journalists, commentators, pundits and sundry ‘experts’ want? In just a few months she has given more insight into her vision for this country, more sense of the direction in which she intends to lead us, than Tony Abbott and the Coalition have ever given us.

Yet on this week’s Insiders we saw another puerile ‘debate’ on this under the title: Gillard criticised for Government's direction, where Brian Toohey in his archetypical convoluted way insisted Gillard lacked direction, Andrew Bolt said she had no agenda and was ‘flailing around in the wind’, while Phil Coorey indicated that she was doing alright, and Barrie Cassidy queried the validity of the criticisms that she had no agenda, pointing out that what two of the panelists were saying, especially Toohey, was that they disapproved of some parts of her agenda, somewhat different from disapproving of her not having one. So here we had four ‘learned’ commentators arguing with each other about whether or not she has an agenda; some said yes, others, no. Take a look at the video and see how they themselves ‘flailed around’ trying to debate this issue. If this is the best we can get from ‘experts’ supposedly in the know, heaven help us. 

So let’s stop this claptrap about ‘the vision thing’. If the critics don’t know by now what Julia Gillard and Labor stand for by now, they haven’t been listening, or they haven’t understood, or they don’t want to understand. And that applies to you Richo and to you Paul Howes, as much as to Labor’s many opponents.

What do you think?

Deficit Hawks and Spending Doves

The preceding cartoon got me to thinking about the 'Deficit Hawks' in our own country, such as the conservative economist, Warwick McKibbin, and, of course, the squawking 'Debt & Deficit' Hawks in the Opposition, (dis)ably led by Tony Abbott, Joe Hockey and Andrew Robb.

For a nanosecond, when confronted, they will admit that the Australian economy is performing 'well' at the moment. Outstandingly well, if you ask me, but then as soon as is humanly possible they use the opportunity presented to them by the journalist to rail at the ‘massive debt’ that the ALP has ‘racked up’, and how Labor are committed to ‘out of control spending’, or ‘unable to rein in their spending’, or ‘cut back on the stimulus program’, as if negating the tail end of the response to the GFC would make more than a hill of beans of difference, but which would, in all probability, have a negative effect on the economy, GDP and, in all likelihood, the Budget Deficit, as larger welfare payments would have to be made to the newly unemployed.

Also, as the above cartoon demonstrates (and, for your information, the cartoonist is a former banker, so, as a result of bitter experience he would know what he was on about), when Conservative Deficit Hawks squawk about ‘slashing spending’, when pressed it's always the other guy’s programs that they want to cut into, not theirs.

Deficit Hawks fuel 'Deficit Hysteria'.

Probably there is no hotter topic for us politics tragics than deficit control vs. budget spending against the potential of recession, during and after the GFC.

The two camps – Deficit Hawks and Spending Doves – are clearly separate. Arguments are exchanged at the speed of light across the Internet, and in the media, and we have little time to digest the facts.

On the one side have been those governments and treasuries, the 'Spending Doves', who urged aggressive fiscal expansion policies, with government deficit spending and debt growth, facing up to the uncertainty of the forecasts of the likely outcome of the GFC, including the risk, at the present time, of a 'Double Dip Recession' for some countries.

On the other side are those who think the moment of exit from Keynesian and pro-cyclical strategies arrived yesterday, after their mates in the Banks had their butts pulled out of the fire by the taxpayer, now justified 'due to high levels of government debt’, a fiscal deficit, and public debt ratios that will 'depress future growth in the economy'. These are the 'Deficit Hawks' fuelling 'Deficit Hysteria'.

Now, if you really want to read the proof to justify not believing the debt hysteria hype, you could consult learned exposés, such as, Deficit Hysteria Redux? Why We Should Stop Worrying About US Government Deficits (and if they believe that you shouldn't worry about the US government deficit, why the heck are people worrying about ours?), and Does Excessive Sovereign Debt Really Hurt Growth?, both by Yeva Nersisyan and Professor L. Randall Wray (And note how that hot button term 'Sovereign Debt' gets dealt with as no big deal anyway).

What they basically argue is that deficits do NOT burden future generations with debt, nor do they crowd out private spending or borrowing. Conclusion: 'Sovereign governments are “default proof”, even if their non-government sectors are still crisis prone.' Thus, what people in the political parties of capital are essentially worrying about is the collapse of private enterprise, not 'beggar thy government'. Fair enough. However, they should be transparent about the fact that they are attempting to preserve their base, as opposed to the specious fear mongering about government 'Debt & Deficit'.

Now, if, like me, you have no way to avoid Joe Hockey's 'blatherings' about the economy, so ubiquitous are they, you will notice a couple of well-worn 'debt hysteria' slogans above that have slipped from his lips repeatedly of late, when criticising the Labor federal Government's Stimulus spending program. That is, that future generations of Australians will be burdened with the debt being created by this ALP government, and, that the government borrowings, “$100 million per day!!!” to fund the debt, are 'crowding out' private borrowing and private spending. When, as we can see, the empirical economic evidence by erudite economists suggests the exact opposite.

If you really want to get to tin tacks on why Hockey, et al. are wrong, Yeva Nersisyan explains it this way:
'They (debt hysterics), don't seem to understand the operational realities behind government spending and taxing. A sovereign government doesn't finance its spending in the way private sector entities, and this includes families, do. It spends by issuing IOUs/Bonds (document acknowledging debt). Hence, the arguments regarding crowding out effects, as well as this argument that governments will, of necessity, need to raise taxes in the future sometime to finance the deficit (Ricardian Equivalence), are all wrong.'

And, in fact, the real risk to the economy, as the Rudd government ably addressed during and after the GFC, is all around deflation/inflation prospects, and employment/unemployment.

As Yeva Nersisyan explains it:
“Yes, sovereign government spending is not constrained by tax and bond revenue, but by inflation. The issue is the distribution of real labour resources that are relatively fixed in the short run; this leaves less for the private sector to consume if the government starts competing with the private sector. If the government starts competing with the private sector for the use of these resources, then this may lead to inflation. It's a real resource constraint, not a financial constraint. Hence the issue is not solvency, but sustainability. In the current crisis the private sector obviously is/was not able to employ all the available labour resources. At times such as this inflation is not a concern; most developed economies are under the threat of a deflation. Ideally, in this situation the government needs to step in and hire all those left unemployed, or provide the capital to hire those left unemployed by the private sector. Once the private sector gets back on its feet the government can release those workers back into the private sector, by withdrawing the stimulus, to avoid inflation. A job guarantee/government stimulus spending program is an automatic mechanism designed to achieve precisely this.

So there you have it. It sounds exactly like the program the Rudd/Gillard government instituted during and since the GFC, which it is winding back carefully now.

If I was a conspiracy theorist I'd say that those members of the Opposition that actually understand economics, like Robb and Hockey (yeah, I know, you've got to wonder sometimes), would know all this to be true, but instead are deliberately engaged in a malevolent campaign of disinformation, destabilisation, and disruption to the smooth and effective functioning of ALP economic policy, such as we have been seeing effectively playing out since the GFC.

I mean, it's one thing to prattle on endlessly about 'Debt & Deficit', but the Coalition would surely know that you really shift votes permanently into your column when the punters start losing their jobs, as Paul Keating found out to his detriment after 'The Recession We Had to Have', and President Obama in the US also discovered in the recent 2010 Midterm elections. If large upticks in unemployment do happen then the criticism about economic incompetence sticks like Super Glue, because nothing hurts more than not being able to buy the latest mobile phone, or car, if you've lost your job for no good reason other than the economy tanking as a result of the government not being able to save jobs, which factors into your perception of their actions in the face of the recession. John Howard surfed to glory on this realisation, and I'm sure Joe Hockey would love to too.

Ain't gonna happen though, as Gillard & Co. are smarter than that.

Finally, as the cartoon alluded to, another fact that is conveniently overlooked by the 'debt hysterics' is that when they call for 'Spending Cuts', as the Coalition has, it is code for cuts to Welfare. I can't lay out the argument for that assertion any better than in the following article from The London Review of Books, conveniently published this week by Professor Ross McKibbin, of St John's College Oxford:  

It may be about the British economy and politicians, but it has direct relevance to Australia and our Conservative politicians' rhetoric about the Australian economy.

The two most important points he makes are that the budget cuts that Conservative politicians call for never make any serious attempt to drag the wealthy into the 'circle of suffering'. I mean, did the Coalition advocate for the abandonment of Tony Abbott's profligate Paid Parental Leave Scheme that favoured the wealthiest mothers in our society? No. Or, any Means Testing of Private Health and Education subsidies? No. Or an end to overly generous 'Agrarian Socialist' Rural subsidies that favoured their partners in the Coalition, the National Party, and their cohorts? No. Or, an end to Capital Gains Tax or Superannuation tax concessions that favour wealthy property investors and wealthy 'Self-Funded Retirees'? No. Just more of the same old attack the 'dole bludgers' and 'Disability Pensioners' rot and Tonynonsense.

This goes to the heart of Professor McKibbin's second, and most important point about Tory attacks on Labo(u)r governments’ 'Debt & Deficit'. That is, that crises like the GFC allow Conservatives to transform a crisis of the banking system into an attack on the Welfare State. As he says, “this, they hope, will enable them to restructure government and 'shrink' the state and its welfare systems once and for all, something they have been trying to do for the last 30 years.”

However, with this knowledge, and, as I have said, having taken the time to read the whole article, we can be forearmed with the knowledge required to counterattack the spurious assertions of the ideologically-driven Conservatives, who are truly 'Deficit Hawks' cloaked in 'concerned' clothing. Concerned for their own interests, that is.

What do you think?

How lies, deception, slogans and mantras kill the truth

The concept of ‘truth’ has exercised the minds of philosophers for centuries. Several theories of truth have been propounded, but the one that likely corresponds most closely with common understanding is what is termed ‘correspondence theory’. It says: “true beliefs and true statements correspond to the actual state of affairs.” It posits a relationship between thoughts or statements on the one hand, and things or objects on the other. It is a traditional model that goes back to some of the classical Greek philosophers such as Socrates, Plato and Aristotle. Lest we uselessly expend our thoughts and energy here on philosophical argument about the meaning of truth, for the purpose of this piece, let us accept this proposition. Anyone interested in exploring other theories of truth might enjoy reading Wikipedia’s exposition on ‘Truth’, which as a matter if interest features a classic 1737 painting by François Lemoyne Time Saving Truth from Falsehood and Envy.

In politics there is perpetual argument about what is ‘true’ that in itself is desirable, but there is a pernicious overlay – creating the ‘truth’ that a politician or party want the people to believe. This is achieved by perpetrating lies, through deliberate deception, and via slogans and mantras.

Just a few days ago there was an example of lies propagated about President Obama’s visit to India revealed in a YouTube video Rachel Maddow Explores Right Wing Lying Echo Chamber, which you can view by clicking the link.

Presenters from CNN, Fox News and the Glenn Beck Program insisted that Obama’s visit to India was costing the US taxpayer $200 million per day (another said $2 billion - maybe that was for the whole visit); that one tenth of the US Navy (34 warships) would be deployed to protect him and 40 airplanes; that 3000 people would accompany him; and that over 500 rooms had been booked at the five star Taj Mahal Palace Hotel for his entourage. When the source of these assertions was challenged, the reply was that: "it is coming out in the press" and is "on the Internet"! That of course confirmed their veracity; into what better sources could one tap? Enjoy Rachel Maddow’s ridicule of these preposterous assertions, made in all seriousness by presenters who enjoyed making hay out of them to Obama’s detriment.

Now that was in the United States of America. Surely that could not happen in Australia! Let’s see. We don’t have to go far to find that it is so. Joe Hockey alone provides us with enough examples, instances faithfully echoed by Tony Abbott and Andrew Robb.

“Labor will never bring in a surplus budget” recited over and again with great authority, is by definition a fabrication – a lie told when someone submits a statement as truth, without knowing for certain whether or not it actually is true. Hockey has no way of knowing whether or not this statement will be true, but speaks as if it already is. Said often enough, more and more people will believe it is true, and begin to repeat it themselves. What will Hockey say when the Government does bring in a surplus budget? As he is equally capable of criticizing the Government when interest rates go up as when they stay the same, it should not be difficult for him to conjure up some trenchant criticism.

“Labor cannot manage money”. How many times have we heard that slogan? No supporting evidence is deemed to be necessary, nor is contradictory evidence considered applicable. What did Labor do through the GFC? Manage money. And they did it brilliantly, placing Australia at the very top of the list of developed countries that best survived the crisis. Of course Hockey argues that almost every other factor in Australia’s success was the prime factor – a well regulated, well capitalized banking system, reforms initiated by previous governments, especially the Howard Government, and no debt at a federal level. He gives scant credit to the bank guarantee, and in particular the stimulus packages, despite all but ultra-conservative economists acknowledging the latter’s nation-saving effect, and how it kept people in work and avoided small business failures. So Joe Hockey is wrong – Labor CAN manage money; it has demonstrated this convincingly in its first term. Hockey is lying, yet many mouth this untruth as if it is true.

“Labor is addicted to spending and debt” is a mantra that falls from Hockey’s lips repeatedly; only Andrew Robb seems to say it more often. What does it mean? Addiction is a disease, defined as devoting or surrendering oneself to something habitually or obsessively. Addiction causes loss of balance and rationality. Is Hockey seriously asserting that the entire Labor movement is pathologically addicted to spending? When pressed, he reluctantly admits that stimulus spending was necessary but insists that too much was spent, thus warranting his diagnosis of addiction. While some might argue that this is a statement of opinion, not a lie, it is stated so authoritatively that it easily passes for the truth.

Hockey is an expert at deception too. He paints as grotesque the projected Government debt and the borrowing to service it, estimated by the Coalition as $100 million a day. Now that sounds an awful lot to the average householder, but when it’s pointed out that it is equivalent to someone on $100,000 a year taking out a loan for $6,000 and paying the modest interest on that sum, it no longer looks like a huge commitment. Instead of using relative figures to put the Government’s borrowing into perspective, Hockey chooses to quote absolute figures with an intent to deceive the public into thinking Labor has incurred a horrendous debt, a debt that is a tiny fraction of similar debts incurred by comparable countries. Never does he balance the eminently modest debt against the saving of hundreds of thousands of jobs and the avoidance of countless small business failures. It’s all negative, all deception.

"Government spending will lift interest rates" is what Hockey asserted a couple of nights ago on Lateline.  He said: “Australia is a massive importer of capital and as such, when you've got the economy running at full capacity, if you've got the Government borrowing $100 million a day as a AAA-rated entity in competition with small businesses out there, with home borrowers out there, it is going to put upward pressure on interest rates. There's no doubt about that.”

When Ali Moore asked: “But how much? A small impact, medium impact, big impact?” Hockey obfuscated with “Well, it - it varies. It depends on the accessibility of the money”, knowing full well that virtually every economist when asked about the impact of the Government’s borrowing on the interest rates set by the RBA and the banks, insists that it is ‘miniscule’. Yet Hockey deceptively leaves the impression that it is the Government’s borrowing that is pushing up interest rates for mortgage holders and small business borrowers.

And if you think Hockey isn’t able to deny the undeniable, listen to this exchange on the same episode of Lateline:

ALI MOORE: Just a final question. Tony Abbott says the banks never moved the mortgage rates independently of the RBA under the Howard government.

They did - twice.

Is it a great hindrance to you when you're trying to make an argument about the banks when your leader gets the facts wrong?

JOE HOCKEY: No because in fact, the truth is they did move but they reduced interest rates by more or, uh - certainly didn't increase interest rates by the same level ...

ALI MOORE: Indeed. Once they reduced them by less than the RBA. The second time, they hiked when the RBA held.

JOE HOCKEY: But on other occasions they actually reduced their interest rates by either more than the RBA or they certainly didn't pass on the RBA rate increase.

ALI MOORE: So he wasn't wrong?


So is black really white Joe? Yes.

To return to the beginning: lies, deception, slogans and mantras DO kill the truth. Yet we see them used every day by our politicians. Is there any remedy?

The only one I can see is that we must continue to uncover the lies and deception. We must do a Rachel Maddow exposé every time they occur. We are small in number and limited in influence, but eventually the tiny Lilliputians tied Gulliver down and rendered him impotent until he gave them assurances of good behaviour in the future. We can do the same.

What do you think?