January 13th 2001

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Articles from this issue:



Part A: Globalism - the theory and the reality

Corporate capitalism: the product of government intervention

Part B: A history of economic rationalism in Australia

Part C: How Globalism undermines the family

Part D: The cultural revolution and the new economy

Part E: A policy agenda for Australia's future prosperity

Some remarks on the new economic disorder

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Some remarks on the new economic disorder

by Max Teichmann

News Weekly, January 13, 2001
Those who recall their Marx might be pardoned for thinking that at least some of his dicta were soundly based. Now that the opponents of what otherwise would have been unfettered, free-ranging capitalism have been removed, neutered or suborned, the laws of pure undiluted capitalism are now in full swing. Labor is a cost of production, just as water, power, raw materials have always been. Lowering the cost of one or more of these items lowers the cost of the completed article. The savings can be passed on in the form of a lower price to the consumer, or else retained as extra profit.

The price of labor can be reduced by lowering wages, or by extracting more productivity per worker hour - by whatever means, (ideally the least expensive means); or replacing people with machines. All of this is occurring.

Some sections of the labor force will be able to protect themselves better than others - unionist as against non-unionist; full time as against casual or part-time; groups at the nerve centres of the economic system, the sudden withdrawal of whose labor could produce chaos and considerable economic loss, eg. power workers, wharfies, and police. Having this clout, and being prepared to use it makes them the bad boys, the wreckers of the system ... so far as the rich and their media mouthpieces are concerned.

Human nature being what it is, this clout sometimes really has made the possessors the second order bad boys - holding their fellow workers and inoffensive businessmen and farmers to ransom, along with governments. But meantime, the system rolls on and the real bad boys take advantage of the harm inflicted upon their smaller business rivals; plus the bad press received by unionism per se, and the average small union, by such strikes.

Unfortunately, there are fewer and fewer small unions, as there are unionists of any kind. Following upon the iron laws of centralisation, and the concentration of power in fewer and fewer hands, our unions are now big corporations, rarely consulting their members, but feeding on their dues and disposing of their super funds for purposes only remotely related to the class struggle. Many are intertwined with their class enemies. This political clout has enabled them to dominate, where they don't control, many Labor Parties, including our own. The sad story of Queensland was in a sense inevitable; the same process is going on in Victoria, only mainly via the public service unions.

But in the face of the crushing power of the multinationals, the porous nature of national boundaries and the weakness of national governments towards the international players, serious proposals are periodically mooted for a global union movement, so as to check the power of global Finance and Industry. Especially as the supposed umpires in this world of work and profit, viz the World Bank, the IMF and the relevant UN agencies, speak only the language of globalisation and free trade, and that with a strong American accent.

There are many reasons why workers or citizens shouldn't place too many hopes on a new global union colossus. Just one reason will have to suffice here.

The apparently inevitable processes of centralisation, bureaucratisation, unaccountability and secrecy, which are the curse of all large organisations, including Non-Government Organisation (NGO)s; the tyranny of distance and the large numbers of client national unions, which the central bureaucracy could play off against one another, suggest pitfalls for a world trade union body. And the apparent elitist networking of CEOs, representing bodies who are supposed to be acting for opposing clienteles, a back stairs networking which has turned so many international transactions into charades, eg. the EU, the UN itself ... are further grounds for scepticism. However, almost anything which can slow the march of globalism, and defeat the implementation of economic rationalist scenarios is worth considering.

The house of cards

Phillip Adams, quoting someone or other, said that sooner or later, there might be only two real jobs for every ten people of working age, these, presumably, wanting work. Books like Rivkin's A World Without Work, simply back up the Adam's thesis - which if true, foretells catastrophe. Any system which delivers up that kind of result, along with all its social spin-offs, is living on borrowed time. But meanwhile, it goes on removing real jobs, while pointing to rising GDP, trade volumes, etc. It can do no other.

In Australia, as mining, agriculture and manufacturing began shedding jobs, new service industries were supposed to take up the slack, and provide for new migrants. They couldn't - only laying swathes through small business and creating a world mainly fit for great supermarkets and agribusiness. Then, despite all the philosophical shadow boxing about slashing public spending, reducing state intervention, downsizing the state, very similar strategies to check the rise of unemployment and to stimulate the economy have emerged, no matter what the Party.

Scrambling the real unemployment figures, by changing definitions and criteria; putting many unemployed on disability pensions, keeping the young at school and university till they die of old age, pumping up the "caring" industries till they look like Alan Bond's blimp - the money going, in the main, to the carers and minders, not the cared; littering a defenceless town with museums and art galleries, like Lorenzo De Medici (or was it Quasimodo?) or centres and monuments, like Mussolini - all this waste and folly keeps business running and people in work - for a time.

There is no way governments are going to cut back on the unnecessary numbers of bureaucrats and free loaders who attach themselves to refugees, aid, charities, education, the arts, migration, legal and illegal, multiculturalism, public broadcasting and so forth - for that would reduce spending, and employment.

Social stress

The deep insecurity now built into people's lives has fed the gambling industries, the drugs industry, the alcohol explosion, crime and social stress. This in turn has legitimised the legions of social workers, the counsellors, the fifty-seven varieties of psychotherapists - all making the new, sick section of the economy go round.

But this pump priming comes from tax and borrowing. The rising volume of taxation, more and more of it indirect, is turning the population into tax evaders, or resentful payers. Having been drilled to define themselves as consumers, often conspicuous consumers, the population as a whole is deeply in debt, quite apart from the haemorrhaging effects of gambling, alcohol, etc. Everything has to go right externally, for more and more Australians to continue to survive in society, and the economy.

Any sudden shock, or prolonged economic downturn, is going to spell disaster for a population living more and more on fantasy, and unfamiliar with the Reality Principle. So, the world of laissez faire global capitalism is resembling the Lord of the Flies, and things are only manageable when we don't, in reality, follow the global or rationalist rules. Luckily, people and governments, whenever they can, only do so half-heartedly.

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