SPEECH: The Role of Government in the Anxious Century

04 October 2019

Dean's Lecture Series at Melbourne Graduate School of Education. Australians are more anxious than ever. Work is increasingly insecure and hard to find, our planet is burning, everything costs more while our wages are stuck and it feels like we are only ever one moment away from world war three. What is the role of government in securing people’s lives with decent employment and a sustainable future?

Before anything else, I’d like to acknowledge the traditional owners of the land on which we gather today, the Wurundjeri people of the Kulin Nation.

I pay my respects to elders past, present and emerging.

It is always humbling in these moments, to recognise the ancient custodianship of the land around us.

It is an honour to be here today. I am the Labor member for the Federal seat of Cooper, and my thoughts have been sought on the role of government in this “anxious century”.

There certainly is much, at present, to be anxious about.

On Friday September 20, I joined over a hundred thousand other Australians on the streets of Melbourne. It was an act of solidarity with a global movement of young people, demanding climate action.

Theirs was an international protest staged in cities and towns from Toronto to Jakarta, Brisbane to Wagga, Perth to Wollongong. Industrial communities, farming communities and urban ones. An estimated 300,000 young Australians participated in events and marches across the country.[i]

Melbourne was an amazing spectacle. The environment-conscious kids made their placards by recycling old boxes and bits of cardboard. And they painted the cleverest, funniest slogans - drawing images from pop culture and the internet memes that define their generation.

Not all of the references I get, though some I do, like:
“I want to live long enough to play Fortnite”, and
“Our house is on fire!”, and
“Don’t burn our future” and favourite
“this... is NOT fine”.

Australia’s Liberal Party Prime Minister did not express solidarity with these young people. The ABC reported the Liberal leader warned against protests “causing children needless anxiety”.

This man - who refused to attend the United Nations summit on climate change held in America, while he was in America, insisted Australian children should be confident instead. Confident that they’ll live in a “wonderful country and pristine environment”.

I suspect the latter is news to kids living through bushfires in winter, and an ongoing drought. But the Prime Minister added “they will also have an economy to live in as well.”

If the Prime Minister is concerned about provoking anxiety in this generation of young people, I’d suggest he remind them of the economy as rarely as possible. Because while the irrefutable science of human caused climate change is certainly provoking anxiety in high schoolers, it’s not their only source of concern.

The scourge of insecure work, debilitated workplace conditions, attacks on unions, retracting education and training opportunities, low wages and a high cost of living.

All the things causing economic misery among adults, right now. All the things that have resulted from economic settings prioritised over the last six years of a Coalition government.

There is cause for grave anxiety amongst the coming generation whether they’re the ones attending climate protests, or not.

This generation of young people face a tertiary training environment where TAFE’s been denuded of funding, courses have been stripped, campuses closed, apprenticeship opportunities erased and in which exploitation of students by dodgy private providers or through “unpaid internships” is rife.

Where the learning environment of universities has been compromised by generations of corporate managerialism, inadequate funding and the mass casualisation of university teaching staff.

Where entry level jobs for unskilled workers are few and far between, where there are at least three jobseekers[ii] for every job advertised, and where over a million people are underemployed[iii].

These young adults face a future in which Centrelink recipients are demonised, stigmatised, and forced into labour programs including Work for the Dole, the PaTH program, and, in remote communities, the Community Development Program.

This isn’t dystopian fearmongering.

It’s the present.

This is Scott Morrison’s economy that Australians live in now.

With 40% of Australians already in insecure work[iv], Australian kids are facing futures in which permanent jobs with stable conditions are becoming a matter of vocational luck.

From industrial plants to mine sites, to academic departments, and to the offices of major media corporations, we have seen the old, secure jobs disappear - outsourced, casualised, offshored.

Union officials travel this country, and meet workers who have worked the same “casual” job for five years, ten years, fifteen years, without ever being offered the respect and dignity of a permanent contract, or its entitlements.

Unions are constantly fighting attempts by employers to tear up awards, to replace their loyal and long term staff with outsourced labour hire on inferior conditions, with cut pay. Or they terminate hard fought EBAs throwing workers back on award conditions.

We all know the infamous Carlton United Brewery dispute in Melbourne.

It was a hard fight that the unions won.

But it also happened at Murdoch university in WA[v].

It happened at Esso, Longford[vi].

It’s happening everywhere.

It happens wherever employers think they can get away with it.

Kids at high school now have no economic indication (beyond, of course, the very great good fortune of inherited wealth) to believe they will ever be able to purchase their own homes.

Their millennial sisters and brothers have certainly ceased to believe it[vii].

The intersection of housing unaffordability, profit-based urban planning, rising education costs, low wages and insecure work is destroying the traditional rituals of Australian coming-of-age.

Swathes of young people can no longer afford to move out of home, and start to live independently[viii].

Kids at high school today are the generation more likely than ever to still be living with their parents into their thirties.

The social impacts of these anxious economic conditions are being felt by us all, and those from marginalised communities the most keenly.

It is heartbreaking to encounter the regional families, in New South Wales devastated by the consequences of dangerous drug use by the young people.

Kids with no opportunities and no longer any belief that there’s anything better to do.

It is enraging to encounter kids in urban Victoria, who fail to complete their tertiary study because they’re exhausted and exploited by the part time job they need to meet living expenses.

And I will never forget attending a memorial for an 18-year-old in Queensland[ix].

He’d been killed in a bloody, brutal accident, unsupervised and unprepared, operating heavy machinery on work-for-the-dole.

Within communities from Tasmania to the Territory, there are Australians who’ve become politically cynical and too used to an ongoing economic impoverishment and a lack of opportunity.

Any advertiser can tell you: the people who are easiest to sell to are those who are angry and frightened.

And there are plenty of extreme, right-wing opportunists out there, using the new technology of the internet to sell depressed, exploited people comforting lies and fanciful scapegoats, on whom they can vent their resentment and frustration[x].

The tropes are ancient.

The insane conspiracy theories about refugees, Muslims, Jews, feminists, trans people, African gangs, and Greta Thunberg might be pushed through the internet, but they’re cut from the same paper as any of the villains invented by right-wing populists in the angry and frightened 1930s.

Yes, these are fringe views.

But Australia must accept that allowing any community around the extreme right to thicken increases the confidence of that fringe element to act.

This speech is titled “The Role of Government in the Anxious Century” because as a citizen, a trade unionist and a member of parliament I have lived long enough to learn that the instability and fear instilled into the economic lives of Australians is no passive event.

It is no phenomenon of “the market”, independent of human will.

It is a policy choice. It is a government choice.

How did we get here?

The miserable economics of our times are, of course, the raw, material outcome of neoliberal values, values that have defined economic thinking in this country for forty years.

Neoliberalism insists that the drive of profiteers to exploit markets is the most efficient means to deliver goods and services to people. Now I am not against profits. My parents were a small business owners and we made a very nice living from the beer he sold from the family pub.

But to the doctrinaire neoliberal (and there are quite a few in our present government) public institutions, civil services, economic regulations and unionised workers are “market obstructions”.

Neoliberals repeat mantras of “small government” and tax cuts because these shrink the public sector, mandating social needs like transport, or telecommunications to be sought from private operators.

Neoliberal thought gained influence when the international oil boycotts of the 1970s caused price rises, and supply crises, within systems of production, transport and trade[xi].

There were job losses, and sudden high unemployment.

These were singular events, but an activist neoliberal movement argued they’d exposed systemic economic problems, and pushed their “free market” theories as the way out of chaos.

Liberal PM Malcolm Fraser led the neoliberal transition in Australia, in the 70s. He slashed the public service with his infamous “Razor Gang” program of cuts[xii].

In the 1980s, the Hawke and Keating Labor governments deregulated the economy to further fit the neoliberal frame, and privatised state assets like the Commonwealth Bank, and Qantas.

As a Labor person, I am not going to condemn a government for whom the project of modernising the economy was intrinsic to delivering the positive gains of a modern award wage system, as well as the “social wages” of Medicare, superannuation and the mass expansion of higher education.

But as a Labor person I will not stand here and defend the framework of an economic legacy that has ceased to deliver for the people Labor represents.

Paul Keating himself announced that neoliberal economics had “run its course” and reached “a dead end”, back in 2017[xiii].

Because, since the 90s, the neoliberal activism of Liberal governments has been zealous.

Policy has expanded corporate advantage far beyond the balance of public and private interests, envisaged by Hawke and Keating.

Restrictions on union organising have compromised the ability of workers to demand wage increases and there is a low wage crisis.

It’s now against the law for unions to inspect the books at a workplace, to ensure that staff are paid properly and surprise, surprise there is a wage theft crisis, too.

Business deregulation and murky contracting have allowed supply chain outsourcing, subcontracting and the “casual” contracts that make work more insecure.

The advocates of privatisation promised corporate management would make social services slicker and more efficient.

Yet from banks to airlines, phones to prisons, electricity to aged care,
privatised businesses again and again have maximised profits by sacking staff, charging higher prices, slashing services, and compromising standards.

Neoliberal theory insists rewards will flow to the poorest if they’re dispensed to the richest first.

But for four decades we’ve seen that corporate profit is not shared with working people.

It is extracted FROM working people - through ongoing, deliberate policy
that erodes their conditions and their pay.

Like how we humiliate the unemployed in this country.

The unliveable level of Newstart, and Liberal schemes like Robodebt,
Work for the Dole and ParentsNext aren’t just about minimising a welfare bill.

They have propaganda value. Humiliating unemployment conditions dissuades working people from risking their jobs, by making pay demands - or joining unions.

Neoliberal economics actually encourages the policy of keeping enough people unemployed to maintain downward pressure on wages.

(The policy is called a “NAIRU”. It’s all on the Treasury website)

Similarly, public service cuts and privatisation keeps everyone’s wages down, by restricting the availability of government jobs. Jobs that are usually more secure, with better conditions, because the public sector is more centralised, and more unionised.

Having to compete with the conditions of a thriving public service can dent a private operator’s profit margin.

So from Border Force to the ABC, the weather bureau to the ATO, the government pursues cuts, outsourcing, and wage caps.

Neoliberals tell Australians again and again that squeezing the public service is “sound economic management”.

That we must trim the fat, cut the red tape, deliver efficiency dividends. Punish “the fat cats in Canberra”.

These are euphemisms, for shutting public programs, and sacking public servants.

It’s an ideological crusade for neoliberals, who believe in ceding democratic control of institutions to profit motives and unaccountable, corporate whim.

But underneath their insistence, and their ideology, that this is all “sound economic management” the real economic balance sheet remains.

And the truth seeping into our papers of late is that what’s keeping our local economy going is not rewards to the rich, budget cuts or, once again, yet more government generosity towards corporate Australia.

For months, business writers have observed traditional economic indicators like business investment, dwelling construction and consumer spending are all down.

The governor of the Reserve Bank has warned, repeatedly, low wage growth will cause an economic slowdown.

And less than a month ago, Westpac’s chief economist declared that “in a per capita sense” our economy had gone backwards in the last 12 months[xiv].

There’s been a dramatic fall in the sale of new cars, while nest eggs are eaten up funding day-to-day expenses.

They suggest consumers fear a “likely deterioration in the labour market”. That is more job loss.

(As I was writing this, my iPhone pinged to inform me that the RBA had cut interest rates again to record lows given concerns of rising unemployment, amidst ongoing low wage growth.)

And the truth revealed here is that Australia is avoiding a recession due to government spending, by local governments and the states.

Yes. The bedrock of our economy is spending on the infrastructure that neoliberals would insist the government not build, and the public servants they’d be told not to employ.

I repeat - its investments, from governments, that are keeping the Australian economy growing while we experience the most sluggish period of growth since the global financial crisis.

Turns out, there is a viable economic alternative to neoliberalism that is not Soviet communism. There is a role for government in the anxious century and it’s to rebuild productive and sustainable economies through the methods of tried and true full employment policy, and directly creating jobs, jobs, jobs!

When a modern liberal like Scott Morrison talks about job creation, it is firmly within the neoliberal frame.

His solution is to make economic conditions as favourable to business as possible, in the hope businesses may, at their convenience, possibly choose, at some point, to create some jobs.

The insistence upon neoliberal orthodoxy is so overwhelming the young generation of the climate marchers probably don’t even know, maybe can’t even imagine that the Australia economy once enjoyed full employment.

Not by accident, or by luck, but by deliberate design.

The ideological tapestry of what makes up modern Labor is vast and complicated, as any broad movement fighting a cause though history is bound to be.

Ben Chifley’s “Light on the Hill” speech distils the spiritual essence of what it means to be Labor.

But if there is one document that speaks to the practical, material mission of Labor in government, it’s the extraordinary White Paper on Full Employment, from 1945, the Curtin Labor government’s economic legacy to Australia.

Released while the country was still very much at war, and as Curtin himself suffered the lung infections that would kill him before that war was finished, the White Paper emerged from amongst our darkest and most brutal hours as a plan, a tangible, thought-out plan, to realise the brightness of Australian potential.

It’s a plan, I believe, the chaotic nature of our own times impels us to revisit.

It begins with a simple recognition, and commitment: “that the people of Australia will demand and are entitled to expect full employment” and it places the responsibility for delivering that employment, to stimulate spending on goods and services, squarely upon governments[xv].

Curtin’s Labor generation had weathered the harshest of economic times. From 1919 to 1939, Australian unemployment averaged out at 10%.

Curtin’s own family had experienced crushing poverty. At the height of the Great Depression, the Australian unemployment rate was 25% - a level exceeded only by Germany.

But with subsequent wartime came revelation; there was no iron economic law that prevented extra production “being satisfied to the limit of available resources”. That spare labour capacity could be deployed - by government - to build the nation’s productive capacity.

This wasn’t making “work for work’s sake”, but spending on public works, and public services. It meant workers’ incomes would feed into demand for other goods and services, providing stimulus to the private sector.

The thinking of Curtin’s paper was informed by British economist John Maynard Keynes, who’d argued before the war that without government intervention, cycles of unemployment could remain indefinite.

The paper was Australian policy for thirty years, surviving 23 years of Liberal government - because, to all Australians, its logic was immediate, and inarguable.

To paraphrase:

“To working people, it means steady employment,
the opportunity to change your employment, if you wish,
and secure prospects unmarred by a fear of idleness and the dole.

To the businessperson or professional -
the manufacturer - the shopkeeper -
it means an expanding scope for enterprise, free from the fear
of periodic slumps in spending.

To the primary producer, it means an expanding home market and -
taking a world-wide view - better and more stable export markets.

To the people as a whole, it means a better opportunity to obtain
all the goods and services which their labour,
working with necessary knowledge and equipment,
is capable of producing[xvi].”

Throughout this period, unemployment rates stayed around 2%.

Only the opportunity of the 1970s oil shocks and aggressive neoliberal policies and activism displaced it.

Critics argue that full employment was only possible because so many women were kept out of the workforce at the time. I remind these critics that, at the time, Australia absorbed two million migrants from post-war Europe into the economy. No jobs were “stolen”. Unemployment did not rise.

To remedy to the pangs of this anxious century, my recommendation is certainly to see government policy renew a commitment to White Paper principles for full employment in Australia.

And how marvellous this week that Australia learned the Governor of our Reserve Bank is coming round to the idea!

“The Australian economy can sustain lower rates of unemployment” was in his media release on Tuesday, with “full employment” stated as the RBA’s goal to encourage wage growth, and improve consumer spending[xvii] and [xviii].

Our definitions of “full employment” differ, but what’s shared here is an awareness that the government’s present employment policies are causing real problems for Australia.

Meanwhile, it’s clear that meeting the desperate timetable of climate action is not something that can be left to a market that, yes, can efficiently mass-produce sneakers but won’t regenerate habitat or lower emissions.

What a future to imagine for young people, where vocational training, apprenticeships and entry level opportunities for good, steady, stable government jobs could be offered by a national program of sustainable public works.

Like projects to retrofit public buildings with water recycling and solar systems, as they’re doing in Denmark[xix].

Or rebuilding our national rail network to generate its own power, as is happening in Belgium[xx].

Or transforming our water systems into “biofactories” of clean energy, as they’re doing in Argentina[xxi].

There are thousands of innovative, capacity-building projects that are already installing the infrastructure for a “pristine environment”, new industries, and future economies, elsewhere.

Thousands we could be adopting, adapting, improving and perfecting for Australian outcomes addressing skills gaps and creating jobs in construction, manufacturing, forestry, engineering, administration, project management, design.

Imagine giving the kids now at school those kind of options.

Imagine giving the climate march generation that kind of hope.

The benefits of full employment aren’t limited to the positive effects of just addressing climate change, or individual workforce participation, or a stimulus role within the broader economy.

The small government rhetoric of the neoliberals can hide - but never alter - the fundamental truth; that the role of the public service remains public service, that the strength of our nation’s welfare state expresses the strength of our social commitment towards one other, both as individuals, and as a commonwealth.

Modern Australia’s challenge is an unprecedented intersection of environmental, economic and social tensions around us.

The role of any government in this anxious century is to confront them, not with wilful, neoliberal fallacies, but with a material economic plan - to create jobs, and rebuild our commonwealth institutions, through public works, national infrastructure, and a welfare state.

There is opportunity for the Australian people to prosper and thrive amidst the challenges.

To do so depends on the strength we are willing to invest in this as a collective project and, also, on finding our courage.

Our courage not to nod along to neoliberal assumptions, out of habit, but to reject and replace the economic orthodoxies that are failing.

Our courage to confront and expose the scaremongering and the mythologies of those who’d oppose us.

Our courage to not return to the past, but to learn from it, asses it, adapt it to our era.

To do the practical work.

And, most of all, our courage to be unafraid of change.

In 1993, Paul Keating addressed our party faithful in Bankstown.

He spoke of the program of change that’s born by national necessity, and sustained by a faith in all Australians.

Change “not shaped by a computer model or textbook,” Keating advised, “but bedded in reality and common sense. A change that does not break the mould of Australian society, but reshapes it by drawing on its strengths.”

“In an era of change, the watchwords of good government should be care, support, cooperation. We must take the people with us. That is a Labor article of faith.”

In this anxious, anxious century those of us who do make claims on government, owe it to the kids, the elderly, everyone in the middle (and to ourselves) to always, always keep that faith.