A year on TPS: 2014


As we come to the end of another year, please forgive a little self-indulgence as the TPS Team discusses what TPS has achieved in the past 12 months.

It was a year in which we saw Abbott and his cronies trying to destroy the country and make us a paradise for the neo-liberals, the neo-cons and the economists that support them — and, of course, big business. We saw the worst budget in living memory and have, so far, only been saved from its full ramifications by the senate. We saw Clive Palmer appear with Al Gore to talk about the importance of climate change but, at the same time, cave in to support the repeal of the carbon price. We have seen Abbott, more through luck than design, deflect the budget issue and ‘bask’ in the glory of the world stage, taking on the Russian bear and alienating our closest Asian neighbour. He has ‘stopped the boats’ but also stopped government transparency in the process. He is undertaking more privatisation of government services and encouraging the states to do the same. Without openly saying so, he is pursuing a neo-liberal and economic rationalist agenda backed to the hilt by the IPA (and, as others have noted, he is, to a significant extent, following its ‘hit list’).

Talk Turkey has made the point numerous times about the need to keep up the fight against this government and what it is doing.

We believe TPS has been doing that but not always directly. We are not a news site, and with only a few people volunteering their time behind the scenes we could never be, so we do not react to every government announcement, no matter how bad. TPS sometimes takes a longer view, looking at socio-political issues and the political and economic philosophies that underpin this government, as Ad Astra also did at times.

We published 43 pieces during 2014 over 46 weeks: those 43 pieces actually encompassed 48 postings as we had four multi-part pieces and we also posted mid-week on a couple of occasions. We had six ‘guest’ writers during the year, now counting Ad Astra as a guest since he retired from full-time blogging, but 2353 and Ken provided the bulk of our pieces — 35 between them. We haven’t bothered counting the words but, given that most pieces are between 1500 and 2500 words in length, it would be getting towards 100,000 words. Plus all the words our friends have posted in their comments.

We didn’t ignore Abbott in our quest for wider truths and have launched attacks, both directly and with satire. We first asked whether Abbott remembered the twentieth century in his rush to take us back to some halcyon previous age; we wondered whether he was ever meant to be PM as he originally won his position as opposition leader by only one vote; we suggested he was a ‘con artist’ and questioned his Humpty Dumpty words; and James Wight exposed the extent of destruction wrought on our society in just one year. We presented ‘Tiny-er-er O’penmouth’ who morphed into ‘Tiny Napoleon O’penmouth’.

The LNP and the government more broadly were also in the spotlight in David Horton’s piece on LNP electioneering, Ad Astra’s piece on what underlay the budget, the government’s seeming blindness to major issues raised at the World Economic Forum at the start of the year, its links with the IPA, and the way it snuck through changes in its approach to climate policy during the 2013 Christmas/New Year break.

Political ethics were questioned by 2353 in several posts: he questioned the morality of using refugees for political advantage; the ethics of those who legislate hardship for many in the community but accept expensive gifts and high paid jobs requiring little work; their use of slogans and sound bites rather than taking the time actually to address issues; and asked why we allow politicians to regulate donations to their own parties when we have witnessed that self-regulation doesn’t work for industry. Twice 2353 specifically questioned the link between religious and political values asking how politicians could claim to be religious when implementing policies that clearly breach their religious morality. As Ad Astra commented, it is a brave man who addresses the religious link to politics.

As we have moved from being a ‘society’ to being an ‘economy’, we couldn’t ignore the underlying economic approach of the government and the rising inequality it gives rise to. Piketty’s work on inequality was discussed and was preceded by a piece showing how rising inequality matched the rise of the economic rationalist approach. Finally, Ken suggested that inequality wasn’t an economic question at all but the result of witchcraft (presented as some dark humour to end the year.)

It was also suggested that economic rationalism, after 40 years, may be on the wane: pieces like 2353’s on modern monetary theory and Kay Rollison’s on ‘middle out’ economics reinforced that there are new economic approaches emerging that may, indeed, lead to the demise of economic rationalism.

Kay’s piece was also presented as an alternative approach for Labor. It was one of five pieces that addressed new approaches for Labor, including the speech Ken would like to hear and Ad Astra’s letter that actually was sent to Bill Shorten.

Associated with economics, were pieces on governments’ approach to infrastructure and privatisation.

Ken presented a piece on our understanding of ‘freedom’ which, at first, may have appeared something from left-field, but it was a prelude to his discussion of the lack of freedom in the free market and the loss of social responsibility as the neo-liberal concept of freedom, embracing individual self-interest, took over political thinking.

We also briefly discussed Aboriginal affairs, the role of unions and the role of experts.

We prophesised the future with David Horton’s piece correctly suggesting that conservative governments resort to war in their quest for popularity; Ken’s piece on Abbott’s efforts to take us back in time foreseeing that coal would become more, not less, important in Abbott’s world; and 2353, in ‘The thought thief’, providing a fair reflection of what did eventuate from Pyne’s review of the national curriculum.

The one area we have been lacking this year is putting the media to the sword, other than for Jan’s two-part piece. Perhaps that is because some segments of the media now seem to be doing a better job: Abbott’s broken promises and the down-side of the budget were more widely reported (but still not so much in News Ltd papers). It has been our commenters who have continued to point out the flaws in the media’s approach, including the ABC’s attempts at so-called ‘balance’.

And throughout the year, Casablanca has continued to provide us with numerous links relevant to each post, as well as other news of the day.

We trust we have continued Ad Astra’s tradition by putting the sword to Abbott as prime minister, the government and its policies more generally, its political ethics, its political and economic philosophy, and the approach of the economic rationalists and neo-liberals that support it.

Take the time during the break to revisit some of the pieces that were posted during the year and see what you think now that the year is coming to an end and you can see how the different posts tie together. If you have topics you would like us to address in 2015 please let us know, either in a comment or in a message to the Team (the Contact tab above).

This thread will stay open until 4 January, when another piece will be posted with an extended thread, so please post any new comments and insights you may have. And, as we asked last year, please also feel free to post any video, music video or photo that takes your fancy and that you may wish to share, with a short story as to why you selected it.

Wishing all our lurkers and commenters a happy festive season and looking forward to you being back with us in 2015.

The TPS Team



Time to resurrect witchcraft


Back in 1971 I wrote my honours thesis for social anthropology at Sydney University. Its theme was a link between witchcraft/sorcery beliefs and egalitarianism in native and peasant communities around the world. Given discussion earlier this year about inequality, I believe it has a relevance.

Its principle argument went something like this:

The basic concept of egalitarianism is that everyone is equal and has an equal share of abilities and resources. Of course, in reality, this is never quite true. And in those native and peasant communities, witchcraft was a common approach to explain the differences.

It worked in a number of ways. Those who rose above the norm and those who fell below it were prone to witchcraft, either being attacked by it or accused of it. (Please note that when I say witchcraft, I include sorcery — there was a difference in the anthropological literature of the time that wasn’t relevant to my thesis nor to this discussion. Also, I use the term ‘witch’ to include both males and females.)

Those who rose above the norm could include those who were ‘conspicuously fortunate’, those who had outstanding innate talent (such as a Bradman or a Mozart), and even the ‘big men’ of the village.

For those with talent, it helped explain why they were so good but it also helped keep them within the bounds of the community. While it may only be thought that their talent was a result of witchcraft, if they did not use that talent in acceptable ways, or if they boasted of their talent, it could become a public accusation, leading to public sanction.

Similarly ‘big men’ were recognised as being important for the community, particularly in its dealings with other communities, but they had to maintain the welfare and best interests of their own community or they would also be publicly accused of being witches.

Being ‘conspicuously fortunate’ is clearly an egalitarian crime. The threat of being accused of being a witch helped ensure that those people spread their wealth in socially acceptable ways — catering for large ceremonies, for example.

Those at the bottom (below the social norm) were rarely attacked by witchcraft but prone to being identified as witches, the ones paid to provide the potions or spells. This often related to an illness occurring after an argument between two people (and the argument most often related to one person having more than the other). Both sides of the issue would then have to be addressed, the argument (and which party paid the witch), and the role of the witch.

Some of this demonisation of those at the bottom, those falling below the social norms, can be seen in the European and North American witch trials. Elderly widows struggling to survive on their own and young women perceived as promiscuous were among those more commonly accused.

I saw this operating like three concentric circles reflecting the values of the community. The majority of people fell within the central circle. Then those who were different, the probable witches, operated within the second circle. As long as they remained within that second circle they could be tolerated in a somewhat ambivalent way, but if they moved beyond that second circle they had moved too far beyond the bounds of egalitarianism and would face sanction, exile, or even execution.

I read a simple example of this in a story by Camara Laye about an African childhood. A boy was with his uncle, the village headman, and as they worked their way along a field they were moving ahead of the other men. Then the uncle slowed down and the boy pointed out that the others were catching up. His uncle told him it was not good to get too far ahead. In my terms, he was reaching a boundary where greater success (his speed working the field) would be seen as extreme and probably the result of witchcraft.

Witchcraft in this way acts as a sanction to acceptable behaviour. One tries to stay within the egalitarian norms, even if those norms are somewhat extended within the second circle, so as to avoid witchcraft.

So there you have it in a nutshell. What does this mean for our society?

We no longer believe in witchcraft but perhaps we should.

The majority of us sit comfortably in the middle (within the central circle), follow social norms, at least within acceptable bounds, and are free from accusations of witchcraft. We understand disease much better and no longer need witchcraft or other supernatural sources to explain it. Although it is interesting that arguments or disagreements and the associated stress can lead to illness — perhaps we still need witchcraft to explain that and should focus more on the argument as the root cause of the illness so that the argument is dealt with before a cure is found.

We are much better off in terms of our material possessions but still find blatant displays of wealth unacceptable. When someone builds a house twice as big as those around it, or suddenly appears in a Porsche when everyone else has a Holden or a Toyota, we no longer accuse them of witchcraft but we may think they are crooks, or dealing drugs, or something similar.

We elevate and praise our successful artists and sports people but only so long as they don’t abuse their position or become ‘big heads’. When that happens they become dangerous to our social stability and an element of witchcraft comes back into play. They are seen not to have played by the rules and need to be brought down or cast out.

We accept that we need leaders and powerful people to protect us but are equivocal about their power. We have a democracy which is supposed to control that power but sometimes we wonder whether it does. Of course, we are outraged when we find the powerful misusing their power to increase their own wealth but, after a brief time, nothing really changes and we await the next occurrence.

Our society has its share of people who drop below the norm and they are often perceived as a threat. I think sometimes it is because it is a reminder that there but for a bit of luck goes any one of us. We are not always comfortable knowing they are there but generally we wish to help them back within the inner circle. Many, however, in their day-to-day activities, will avoid them if they can.

The poor and outcast may no longer be witches but they are demonised by the rich, the LNP government and the economic rationalists: they are too lazy to be helped. We are told they use the services and taxes of the core circle and reduce the services available for the rest of us within that circle. They are told by the rich and powerful that they can never get back into that inner circle except by their own efforts, that they are undeserving of help, but that approach is not fully in accord with the egalitarian values of the central circle, so the rich and powerful are treading dangerous ground.

And we have ‘the one per cent’ sitting at the top with all their wealth. How did they get there? Where I grew up, the common view was that almost all who were fabulously rich must have done something wrong, not necessarily illegal but certainly breaching the norms — a few deals that sailed close to the edge of legality, or a few mates abandoned or ‘knifed’ along the way, a bit of insider knowledge, tax avoidance (or should I say tax minimisation so as not to be sued) and so on. Of course, only the rich have this special knowledge and the resources to implement it.

As a society we seem to struggle to find good explanations for these situations, and perhaps find some of them puzzling, even troubling, but witchcraft explains them all.

The conspicuous displays of wealth are obviously the result of witchcraft. An ordinary person in the inner circle cannot get their Porsche any other way. They don’t need to be crooks, just witches. When they know that such conspicuous displays can lead to accusations of witchcraft, they will be less likely to step so far out of line.

The same goes for our successful artists and sports people. They will behave in more acceptable ways if they know that they are always on the verge of a witchcraft accusation because of their ‘unnatural’ talent.

Our leaders may need their witchcraft to counter the witchcraft of other leaders but if they know that we know they are witches then they may be more careful how they use that power. They will know they need to support the central circle or face public accusation and the sanctions that follow.

If those who drop below the norm are thought more likely to be witches, perhaps we will work harder to bring them back into the central circle and so tame their witchcraft. And we will work to keep them in the inner circle because if they drop back again, anything could happen — we might all be turned into sheep (if the rich and powerful have not already turned us into sheep).

Alternately, we may draw on their magic to bring the rich and the powerful into line. While they are there, they are also a threat to those at the top — a reminder that the second circle belongs not just to the rich and powerful but the poor and outcast, that they are in reality in the same situation, operating outside the core values of the society. The poor and outcast have their own spells to attack the rich and powerful and it is a potential battleground for witchcraft.

Finally, how did the super-rich gain all that wealth? Bugger economics! — it was witchcraft pure and simple. They have the secret knowledge that they share only within their cabal.

It follows that they demonise and accuse those at the bottom, the others occupying those outer circles, of witchcraft because they are so conscious of it and fear being accused themselves. The rich and powerful (and the LNP) persecute these other witches to divert attention from their own witchcraft.

I say it is time to bring back witchcraft. It will support our egalitarianism and help us explain so much. We would not need economic arguments to explain inequality, just witchcraft.

We can bring back the witch trials and place ‘the one percent’ before the Witchfinder General. Then let them try to explain that they did not achieve their wealth by witchcraft. We can ask the banks and global corporations to show that, in making their super profits, they have not beguiled us with witchcraft. We can demand that the current prime minister justify his accusations of witchcraft against a certain red-haired former prime minister and, if he can’t, it follows that he, himself, was using witchcraft.

There may be many executions to follow. I think, however, that I could be tempted to become a tricoteuse at the bonfires.

What do you think?



The perils of Self Regulation


A month or so ago, The Political Sword posed the question ‘What have the unions ever done for us?’ The piece closed with a question:

. . .if there was nothing for the political right and employers to fear from the unions, why are the same groups still trying to neuter the unions’ ability to campaign and protect the perceived interests of their members in 2014 while ‘unions of employers’ are encouraged?

There are multiple answers to this question, some of which probably have some evidence behind them. One is that the union movement generally supports the Australian Labor Party — although some unions don’t, such as Together, which is primarily the Queensland public servants’ union. Naturally the support of the ALP would lead to a financial contribution: the conventional wisdom is that if the funding from unions for the ALP is diminished, the political organisation is less capable of fighting an election.

This line of reasoning has some validity but begs the question: where do the Liberal and National Parties get their funding from? Legislation in most jurisdictions within Australia put a cap on the amount of money that can be given directly to any political party without the need for disclosure. The values vary and for the purposes of this discussion aren’t important.

So you have legislation passed by politicians that regulates the donations they are allowed to accept during the course of their political careers. In effect, we are allowing politicians to self-regulate the value of cash and in-kind support garnered from the community and while some of the donations are probably altruistic, we don’t know that. Self-regulation usually doesn’t end up well. To eliminate the claims of ‘[the other side] would do that’, ‘jobs for the boys’; ‘political favours’ and so on, lets look at some non-political examples of failed self-regulation that have affected us all.

The Global Financial Crisis occurred during the late 2000s. The US Securities and Exchange Commission (SEC) imposed a $550million fine and a requirement to amend its business practices on Goldman Sachs in 2010 to settle —

SEC charges that Goldman misled investors in a subprime mortgage product just as the U.S. housing market was starting to collapse.

For more information please go to the link above. The short version of the press release, however, is that Goldman Sachs (and others) packaged up sub-prime (having less than ideal security backing) domestic mortgages that did have insurance in the case of default, claimed the resultant securities were completely backed by adequate security and sold the ‘investments’ to others. There was a loss of confidence in the stock market towards the end of 2007 causing the employment rates and demand for houses in parts of the USA to fall. That also reduced the value of houses and the underlying mortgage security, while those that lost their jobs couldn’t afford to reduce the value owing on the now depressed security value of the mortgage. So the home owners began to default on their mortgages and the mortgage security holder then attempted to claim the shortfall on the mortgage insurer. The mortgages were insured but the insurers couldn’t fund the demand on their policies and were close to bankruptcy until the US Government intervened.

The problem here was self-regulation. In the 1990’s, the Reagan Presidency had reduced the supervision of financial institutions in the USA. Staff of these institutions were ‘incentivised’ with large commissions if they made more money for the financial institution — leading them to take risks. The Reserve Bank of Australia’s response to the 2014 Financial System Enquiry discusses the GFC and claims:

The global financial crisis revealed a number of shortcomings in policies and practices at financial institutions and at regulatory and supervisory agencies, particularly in north Atlantic countries. These shortcomings included: … insufficient financial institution holdings of high quality capital and inadequate management of liquidity risk; inadequacies in basic microprudential supervision, corporate governance and risk management practices; an under-appreciation of the scale and complexity of operations at large trading banks and other financial institutions — particularly those with activities in multiple jurisdictions — and the difficulty in resolving them when they failed; inadequate oversight of over-the-counter (OTC) derivatives markets; and insufficient visibility of the extent of interconnectedness among financial institutions, including between the regulated and shadow banking sectors, and across borders.

The report then discusses the domestic and international efforts to determine the issues as well as rectify them. Amongst the responses were increased prudential requirements, better regulation and better assessment of financial risk — in short, partial re-regulation of the financial markets.

Australia did suffer some fallout from the failure of self-regulation in the financial industry during the Global Financial Crisis, as the Halifax Bank of Scotland (HBOS) owned Bankwest at the time. The University of New South Wales discusses the failure of prudential requirements and the subsequent fallout across the banking sector, the practices of Bankwest under HBOS, and the subsequent problems the Commonwealth Bank inherited when it purchased Bankwest subsequent to the GFC. Yet business finance brokers such as Mooney, Kiddle and Partners, are still questioning the need for regulation in financial markets, arguing the case that the small and medium business lending sector is being affected by unnecessary regulation.

Early this year, someone in the office of Assistant Health Minister Fiona Nash, ordered a website that promoted healthy eating, through giving packaged food a ‘star rating’ between 1 and 5, to be pulled down soon after it ‘went live’. The subsequent investigation discovered that the minister and her chief of staff were implicated in the action. Additionally, the chief of staff was married to the sole director of a firm representing a number of packaged (or ‘junk’) food manufacturers and he had worked for a multi-national packaged food manufacturer prior to his move to the public service. The Australian Consumers Association compared the ‘stars’ that would be awarded to cheese sticks, peanut butter and cracker biscuits and found that the products of one of the multi-national packaged food companies (that had been attempting to discredit the system) did not compare well. The New South Wales Cancer Council has described a number of the methods that are used to circumvent the existing self-regulation of food advertising. The Conversation carried a report in August 2013 entitled ‘Forget children, self-regulating ads only help the food industry’. In the report, Sandra Jones, a Professor and Director of the Centre for Health Initiatives at University of Wollongong writes:

Following advocacy by parent groups and NGOs (non-governmental organisations) regarding the extensive use of premiums to sell fast food to Australian children, the mandatory Children’s Television Standards were revised in 2009 to clarify that an advertisement:

must not make reference to the premium in a way that is more than merely incidental to the reference to the advertised product or service.

A review of food and beverage advertisements in five Australian cities over a two-month period in 2010 identified 619 breaches of the standards, including 120 breaches of this specific clause, and 332 breaches of the industry’s voluntary regulations.

Even ACMA (the body that attempts to regulate commercial media) has concerns about how the packaged food industry self-regulates advertising on television. Regular watchers of ABCTV’s MediaWatch would be aware of its frequent concern of the lack of real regulatory power that ACMA can wield.

No doubt parents find the pestering from their children wanting the latest ‘incentive’ to purchase a particular packaged food product annoying. They do always have the right to say no. The industry demonstrates time and time again, however, that this sort of marketing does work, despite the claims of responsible self-regulation which is supposed to prevent it. Unfortunately the disregard for self-regulation and continual marketing of what is really food that is not healthy creates a number of problems later in life. On 13 October 2014, ABCTV’s ‘Four Corners’ reported on the results of a community health program managed by the council for the City of Ararat in regional Victoria, called ‘Ararat Active City’. The program came about primarily due to the Channel 10 ‘reality’ show ‘The Biggest Loser’ making the claim that the town was the most obese town in Australia — and making a living by selling advertising surrounded by people suffering while attempting to lose weight. A lot of the stories of the participants from both the The Biggest Loser and Four Corners discussed their poor eating habits — from childhood.

Earlier this year Barry O’Farrell resigned as Premier of New South Wales when it was revealed at an ICAC enquiry that he accepted a gift of a bottle of Penfolds Grange from someone with connections to a firm that was attempting to win a Government contract. While the punishment may be excessive for the ‘crime’, why would the ‘thank you’ note have been available three years later unless there was some expectation that the gift would result in favourable treatment? Not that Barry O’Farrell was the only politician caught up in the ICAC enquiry: Eddie Obeid in New South Wales and a few Queensland politicians were also ‘mentioned in dispatches’ — although O’Farrell seems to have lost the most. Politicians make the rules around donations to political causes then appear to fragrantly breach them.

Rob Oakeshott, former NSW and Federal Member of Parliament, writing in The Saturday Paper is promoting a Royal Commission investigating political donations. He claims:

The real threat is within government itself. It is the increasing corruption of our public decision-making by influence gained through record levels of private donations. The only colour Australia needs to fear is the colour of money in its democracy. Chequebook decision-making is the silent killer of necessary reform.

Oakeshott suggests that the commission would need a period of years to properly investigate the structures used by political parties to funnel donations and writes:

We need a royal commission because the only other option is to trust “the system” to self-regulate. By leaving this long-overdue clean-up of the “corruption by donation” of Australian policy to the worst offenders — political party leadership and their respective head offices — we’ll simply fall for the same pea and thimble tricks that have added to the complexity of the current electoral laws. We’ll end up with a convoluted, short-term bag-of-trickery reform.

The claim is made that the two major political parties spend around $100 million per election and, as Oakeshott has been both in the ‘two party’ system and outside it as an independent, he probably has some evidence to support his claim. Any way you look at it, the donors of significant parts of the $100 million would probably expect some ‘return on the capital expenditure’ as demonstrated by the sudden reappearance of a thank you note some three years after it was written.

Despite the claims, it seems that self-regulation only benefits those who are supposed to be regulating themselves. Rob Oakeshott has an on-line petition to sign — available here should you choose to do so — that requests the Governor-General commence a Royal Commission into political donations and how to introduce some rigour into the system to ensure that politicians serve all those who elect them, rather than unknown vested interests.

If self-regulation is a demonstrated failure in the financial markets and advertising of unhealthy food to our children, why do we believe that politicians have greater altruistic values?

What do you think?



Not quite behind the throne


The IPA (Institute of Public Affairs) has had many words written about it, including that it may be the power behind the throne in the Abbott government. The problem is that ‘behind the throne’ usually means a shadowy or lesser known presence but the IPA is making itself anything but that, which may well lead to its undoing.

While the IPA certainly seems to be influencing the current government, one debating point is whether that is a genuine direct and active influence or merely a confluence of ideologies? Either way, it allows the government to support the IPA’s position on many issues and the IPA to claim it is influencing the public agenda.

Abbott in 2013, prior to the election, spoke at the IPA’s 70th anniversary (video here and transcript here) and in relation to its ‘wish list’ of 75 policies for an incoming LNP government openly endorsed ten of them and said: ‘that is a big “yes” to many of the 75 specific policies you urged upon me’.

Others have shown that Abbott, while definitely accepting some of the proposals, has been a little more pragmatic in adopting others or has been slow to take them too far. As with his decision not to proceed with the repeal of section 18c of the Racial Discrimination Act, Abbott may agree in principle with the IPA’s position but he is still a politician and will sometimes bow to political pressure, including public reaction, or to an inevitable political reality, such as not having control of the senate.

It is no coincidence that the IPA and Liberal Party policy are similar because Liberal members of parliament are involved in its activities and its current chairman is Rod Kemp, a former Liberal minister in the Howard government (who had already been a director of the IPA before becoming a Liberal member of parliament). Liberal power broker Michael Kroger is also on the board and one other member is also a former Liberal candidate — the other members of the board are business people. It claims to be a research organisation but there are no academics on its board, although it does have an academic Research Committee. Its approach to research, however, is anything but ‘academic’. Its Executive Director, John Roskam, says:

I’m sceptical about peer review in as much as you’re reviewed by your mates. Good analysis will stand up to scrutiny whether it’s peer reviewed or not.

The rejection of ‘peer review’ is interesting because, although designed to bring rigour to research, peer review has elements of a free market approach. It is competitive in the sense that other academics exercise their self-interest in finding flaws, if they can, in another’s work, thereby promoting their own work and their ability to ‘sell’ their own skills and knowledge. (It is sometimes when these elements dominate that the science can suffer.) If that does not follow market principles, then I’m not sure what does, but the IPA rejects it. We can only question why.

The IPA also refuses to divulge the funding for its research whereas mainstream research may be considered ‘suspect’ if funded by organisations that have a vested interest in the outcome of the research. Roskam again:

… he denies the IPA tailors its findings to the demands of the paying client. On the contrary, he says, clients come to the IPA because their concerns are consistent with IPA principles.

The IPA was founded in 1943, by big business, in response to what was seen as the threat of government interventionist social policies (also perceived as ‘socialist’ policies, remembering that Labor was in government at the time). Sir George Coles, founder of the Coles group, was its first chairman and it has been pointed out that all of its members in the early years lived in Toorak, an elite address in Melbourne.

It is also no coincidence that the Liberal Party was founded the following year: the IPA was involved and is reputed to have influenced (even provided) Menzies’ original policies. Early on it was a more conservative organisation but since the 1980s has become neo-liberal.

Although claiming to be a research organisation, its main aim appears more about getting its views before the public: in 2012‒13 financial year it claimed 878 mentions in print and online; 164 articles by its ‘researchers’ in the national media; 540 radio appearances and mentions; and 210 television appearances and mentions. I am not sure exactly what it means by ‘mentions’ — does it include critical mentions? — but it certainly appears a way of inflating the figures. Thus it claims media success in pushing its agenda. It may not be a bad thing that the IPA is now so openly pursuing its approach because, at least, it opens its arguments to wider scrutiny, rather than simply being a shadowy and secretive presence behind the throne.

Like the old union ambit claims (I’m sure it will enjoy that comparison), the IPA may not get all it wants but creates the debate and climate for the type of reform it wants. As its director for development and communications explained:

If we’re not out there arguing for the Australian Human Rights Commission to be abolished … no one is going to advance the idea of radically reforming it.

Even its approach that the ABC should be abolished as a government funded media service contributes to the ABC inviting its spokespeople to appear in the name of ‘balance’. (Although, interestingly, the IPA also wants the repeal of laws that mandate ‘balance’ in the media.) So, by pursuing a more radical agenda, it actually achieves lesser changes towards its ultimate aim.

The IPA agenda is not simply a set of policy prescriptions but a plan to reshape Australia in the neo-liberal image. Even the title of the article where its 75 policy ideas were presented clearly sets out that intent: ‘Be like Gough: 75 radical ideas to transform Australia’ [emphasis added]. The article correctly suggests that political culture moves left or right when left or right governments are elected, but claims that left governments are more successful in moving to the left than right governments are in moving the political culture and society back to the right. The article suggests that Abbott, to be successful with a free market reform agenda, must act like Whitlam and do it quickly: ‘If he hasn’t changed Australia in his first year as prime minister, he probably never will’. (As Abbott has now been in government for over a year, perhaps we can take limited comfort from that assessment.)

The IPA claims all this in the name of ‘freedom’ and perhaps garners some wider support for its positions because of that. (It had 3,383 members at 30 June 2013 and plans to have five thousand by the end of 2015.) We all support ‘freedom’ but, as with any offer too good to be true, one needs to read the fine print and find out what is actually meant.

I think more pertinent than Abbott’s speech at the IPA anniversary was a speech by Rupert Murdoch at that same event. Here are a few interesting excerpts revealing the big business and IPA defence of the free market and how they would like to shape the debate:

… we must argue the morality of free markets and the immorality of markets that are not free. The cold, commercial word ‘market’ disguises its human character — a market is a collection of our aspirations, exertions, choices and desires.

We have not persuaded people that the market does better because it is more moral — or that socialism fails because it is largely immoral in its denial of fundamental freedoms. To the contrary, too many people think that the market succeeds because it is based on a vice — greed. And that socialism is better because it is based on a virtue — sharing.

The market succeeds because it gives people incentives to put their own wants and needs aside to address the wants and needs of others. To succeed, you have to produce something that other people are willing to pay for.

[The market is] about fairness and opportunity. He [Arthur Brooks, leader of an American free market think tank] defines fairness as the universal opportunity to enjoy earned success. That means enjoying the fruits of our success.

What’s fair or compassionate, for example, about using taxpayer dollars to bail out Wall Street bankers?

What’s fair about taking money from people who have earned it and giving it to people who didn’t?

People begin to resent the rich only when they conclude that the system is rigged. To put it another way, if we wish to persuade people that income inequality is not the right way to measure the fairness of our society, we have to work to make sure that social mobility is real — especially for people at the bottommost levels of society. By that measure, we have much left to do.

Unsurprisingly, Murdoch’s approach to ‘fairness’ was picked up by the treasurer, Joe Hockey, in a speech he made to the Sydney Institute in June of this year:

In other words the average working Australian, be they a cleaner, a plumber or a teacher, is working over one month full time each year just to pay for the welfare of another Australian. Is this fair?

Whilst income tax is by far our largest form of revenue, just ten percent of the population pays nearly two thirds of all income tax. In fact, just two percent of taxpayers pay more than a quarter of all income tax. Maybe these taxpayers would argue that the tax system is already unfair.

The majority of Australians do not understand (rightfully, in my opinion) why some level of redistribution of income is ‘unfair’: the arguments that do exist are more about the extent of redistribution. Also, Murdoch’s claim that ‘income inequality’ is not the right way to measure fairness does not stand up to scrutiny. Murdoch suggests that social mobility is the answer but Piketty showed that the increasing wealth of those at the top is creating a clear lack of mobility, not just for those at the bottom (whom Murdoch mentioned), but those in the middle and upper middle income levels, who now have only miniscule opportunity to rise to the levels of wealth of those at the top (like Murdoch). Murdoch also ignores (as Piketty does not) that his children will inherit all that wealth and will not have ‘earned’ it — ‘earning’ success and wealth is meant to be central to the free market approach. If they believe that earned wealth is a key to the ‘fairness’ of the free market, why don’t they support inheritance taxes?

When Murdoch uses the words ‘greed’ in relation to the markets and ‘sharing’ in relation to socialism, although critical of that view, he actually raises a basic difference. The market is based on the philosophy of the self-interested individual and what is ‘greed’ but an expression of self-interest? Sharing is based on social responsibility and the common good. If, as Murdoch says, people do have this view, it is not some vague unwarranted feeling but a genuine value judgement based on the underlying principles. (Also noting that when Murdoch and the IPA use the word ‘socialism’, they do not mean Soviet-style socialism but almost any progressive view that suggests governments have a role to play in ensuring fairness.)

While Murdoch claims that the market represents human aspirations, my piece on the free market showed the extent to which the economic theory of the market is not based on reality at all: it is a framework supporting the property-owning classes, particularly the property-owning elites. If I lose my property I have no place in the market, no opportunity to improve my situation. I think the ultimate loss of property is someone with a severe disability who has lost their capacity to sell even their labour. What would happen to such people in a pure free market? They would be like the beggars of the past, living on the streets and probably starving.

That takes us to the different views of freedom of the left and the right as discussed in ‘Whose freedom?’. Because the right and the free-market advocates do not accept lack of means or lack of capacity as a limitation on freedom, they do not see why government needs to intervene. It is only the left or progressive view of freedom, that it should include improving the capacity of individuals to exercise their freedom, that deals with situations like the severely disabled person’s freedom in a market society.

The example of the disabled person also shows that there is still a distinction between the ‘market’ and ‘society’, a distinction that is blurred or ignored in the IPA and Murdoch view of the world. Australian society generally takes the view that the disabled person, or the unemployed person forced out of the market (often through no fault of their own), should be given some support. That is done in the social realm, not by the market (although in many ways it supports the market), but because that social approach draws funding (through taxes) from market activities, groups like the IPA, and its business supporters, believe such funding should be severely limited — or non-existent in their perfect world! You can see where the Abbott government draws its inspiration from in its approach to welfare but, as it discovered post-budget, it is not a view widely held by Australians.

Murdoch also mentioned that there was a difference between being ‘pro-market’ and ‘pro-business’, a difference the IPA does not yet seem to have grasped. It has in its 75 ideas the development of northern Australia which, it states, the government should support by creating a special economic zone that provides government incentives and concessions. If the IPA actually believes in the free market then the north would be developed without government assistance because it would be in the self-interest of the free market players to do so. If it requires government assistance, then that is actually, in Murdoch’s words, a ‘pro-business’ stand requiring government interference in the market. Some have unkindly suggested that this approach is simply supporting Gina Rinehart’s vision of the north that includes lower taxes for her mining operations. As a fictional political character used to say many years ago: ‘You may well think that but I could not possibly comment’.

There are reports, however, that some major corporations did withdraw funding support for the IPA over its earlier stance on Aboriginal affairs and more recently over its support of climate change deniers. If those reports are true (and apparently they cannot each be confirmed), it would suggest that some big businesses have more sense, and more understanding of issues beyond the market, but which influence the market, than the current IPA.

The IPA philosophy runs counter to the Australian concept of ‘a fair go’, as Hockey discovered to his discomfort when he echoed Murdoch’s words. As suggested by my other pieces, the IPA misrepresents ‘freedom’ by supporting a very limited concept of the word. It also misrepresents its supposed free market philosophy by supporting specific business proposals that require government intervention (in contravention of the free market philosophy). It thinks that ‘the market’ is society. Its research is questionable, as is its political judgement, as evidenced by its approach to climate change.

The IPA may be behind Abbott’s throne but it is making its presence known, even boasting of its role, which may not be in its or Abbott’s best interests. It has arguments built on sand that are not in accord with the values of the majority of Australians. The more it comes out from behind the throne, as it is doing, the more Australians will understand what it, and the Abbott government, truly stand for.

What do you think?