Australia and the Permanent Revolution for the Rich

Australia is heading toward an election because corporate Australia, by now dominated by multinational corporations, demands of the Prime Minister, Malcolm Turnbull, more free market economic reforms so that their coffers may be filled just that little bit more.

Hitherto Turnbull has by and large dithered on reform, even though, when he ousted Tony Abbott, largely at the behest of the rich, he promised corporate Australia so much by way of reform. Immediately after entering the Lodge Turnbull announced that his administration would be a “reforming” one. The very word, “reform,” was to define his government.

We know what “reform” means. It doesn’t mean reform for the infirm, the poor, workers, in other words people. No, it means more neoliberal reforms to further enrich corporations, managers and investors for their coffers are of infinite volume.

In Australia, as elsewhere, during the neoliberal era, economic reform has been a permanent revolution in reverse, that is one pursued at the behest of the rich and powerful. It is the dynamics of globalisation itself that necessarily makes this revolution permanent. The free movement of capital around the world enables moment by moment capital strikes that are conducted on a continuing basis. That compels governments to continuously pursue reforms in the interests of capital.

Australia is a society significantly penetrated by globalised capital, so much so that Australia is sometimes dubbed as being a “client state” or a “dependent state.” Given the penetration of global capital, the hollowing out of manufacturing industry and the decline of small holder primary production, the pressure to pursue a pristine form of neoliberalism in Australia always remains high.

Turnbull, to return to more nitty gritty politics, promised the rich plenty, but they are unsatisfied as they feel he has delivered far too little by way of “reform.”

The classical example of this process at play was his retreat from “tax reform,” a technical phrase meaning lowering the burden of taxation upon the rich. Turnbull boldly proclaimed an intent to raise the rate of the Goods and Services Tax to 15%, and to broaden its base to bring it into line with Hewson’s austere neoliberal vision in Fightback!

The retreat occurred because it was understood, especially by a jittery backbench, that the public opposes “tax reform,” thus presenting Turnbull with a problem; how to fleece the poor, most especially, at the behest of the rich after the politically maladroit administration Tony Abbott?
To understand what is happening now is to understand why Abbott was replaced as Prime Minister.

Abbott was ousted from the Liberal Party leadership because he gradually exhausted his political capital one imbecility after another. As he exhausted his political capital he lost his ability to continue the permanent revolution. The much discussed hoopla regarding Peta Credlin is but fodder for a political commentariat so debased by froth in the era of clickbait that it has lost analytical nous.

Abbott was of no further use for the rich as he no longer possessed the political capital to continue with the neoliberal permanent revolution.
Enter Turnbull.

Hopes were raised on the North Shore and St Georges Road, places of low income according to the tax department, yet, alas, Turnbull retreated from tax reform. By now moving on Senate reform, and introducing an inquisition bill into Parliament targeting building unions as a possible double dissolution trigger, Turnbull has drawn the battlelines, to borrow an expression from the imbecile, much to the pleasing of corporate Australia.
Turnbull struck to acquire some much needed political capital for what he knows lies ahead. Whether Abbott’s manoeuvres for a double dissolution election on the trigger he wants and with the electoral laws he wants will happen in the near future remains to be seen, however the whole exercise serves to demonstrate intent.

That intent is to create the political and institutional conditions necessary for reigniting the permanent revolution. As The Australian Financial Review’s Alan Mitchell put it, Turnbull must pursue “a broad program of specific reform from the tax, federal-state relations, industrial relations, competition policy, and fiscal reviews and programs inherited from the Abbott government.”

Abbottism without Abbott.

Let there be no mistaking that Malcolm Turnbull is much, much worse than Tony Abbott for Tony Abbott lost his ability to kick people in the teeth. Turnbull still might be able to do this, and do It on a grand scale should he add to his stock of political capital especially following a double dissolution election.

There is another, crucially important sense, in which the neoliberal revolution is permanent. Both major political parties are committed to it. The revolution continues whoever is in office. Much has been made of the Labor Party’s recently announced commitment to full employment as a break from its neoliberal past. Many suppose that the full employment commitment represents a decisive return to a Keynesian social democracy typical before the Hawke-Keating era. This is but a mirage.

The definition of “full employment” adopted by Labor is consistent with the concept of the “nonaccelerating inflation rate of unemployment,” a rate where unemployment does not lead to an increase in inflation, which is a neoliberal concept of long standing. Keynesians, especially Post Keynesians, the true inheritors of the Keynesian revolution, are prepared to buy inflation until all who want a job have one.

Labor will tolerate a reduction in unemployment so long as wages remain contained, a fact implicit in the neoliberal definition of full employment. Furthermore, the Labor Party is committed to fiscal austerity. Policies of full employment, for Keynesians, are associated with a commitment to deficit spending if need be. Australia had its first budget surplus in the post war era in 1987.

The permanent revolution will continue which ever political party is in office. Only its speed, depth and sheer meanness shall differ. The main alternative party , the Greens, are also ever so gradually falling into line.

As the Greens chase more votes so they seek to be more competent economic managers, which is code for falling into line with the needs and requirements of the permanent revolution. For instance, prior to the last election, one to a significant degree dominated by the neoliberal rhetoric of debt and deficit, the Greens’ party room took fiscal policy making power from the grassroots party membership citing the need to develop a prudent and well costed series of policies that wouldn’t be dismissed as “tax and spend” budgeting by the corporate media.

We see here how it is that the dynamics of electoral politics discipline the Greens into toeing the line on economic policy, a process that will continue in earnest should the parliamentary party gradually overcome the membership thus furnishing analysts with another example of the iron law of oligarchy at work.

Although the Greens have played a prominent role in the antiglobalisation, or better still global justice, movement there exists a conservative tinge to the direction that the party is taking on economic policy. The Greens, it would seem, shall not be chasing working class votes by becoming an ecosocialist party.

The two major aspiring parties of government in Australia, to differing degrees, are neoliberal and if the third joins their ranks it too shall be neoliberal.

Under conditions of globalisation, when capital can engage in daily, indeed moment by moment, capital strikes there is little that strategies built around electoral politics, the nation state, and the political party can do to achieve the transformation of neoliberal society.

We can see this with the travails of the pink tide in Latin America and with the capitulation of Syriza in Greece. Although Corbynite Labour in Britain, Sanders’ brand of democratic socialism in the United States, and Podemos in Spain offer much they shall deliver little and will fail either in office or prior to achieving office.

Achieving office at the level of the nation state mandates that economic growth, as measured by GDP, must be the overriding objective of government. When capital can strike with the thunderclap of a Panzer army at but a whim, even at the merest whiff of social reform, it’s very difficult for government to maintain its commitment to growth and thus its electoral viability.

We have little choice but to put globalisation at the centre of our consciousness. To combat the neoliberal revolution is to combat globalisation, and to do that we need to revive alterglobalisation in both theory and practice.

It is precisely the libertarian socialist milieu that offers the best path ahead. The political party, whether vanguardist or electoral, is unable to transform capitalist society for the better nor forever.