Why a Rudd-led Labor has surrendered to big business

Mark Latham no longer leads the parliamentary Labor Party and nor is he a member of parliament yet, unlike some others who have risen to prominence courtesy of the New South Wales Branch of the ALP, he continues to stay out of the affluent inner suburbs of Sydney by choice. This tells us not only something about Latham, but it also provides us a clue as to why he lost the 2004 election and why a Rudd-led Labor has surrendered to big business.

To be sure Mark Latham throughout his career promoted "economic rationalist" (neoliberal) policies. Robert Manne pointed out upon his election as Labor leader that Mark Latham was perhaps the most right wing leader that Labor ever had, up until then of course. The policies that Latham took to the 2004 election hardly betrayed the sinister influences of a hidden Bolshevik policy making cell in the Opposition Leader's office. However, it would be wrong to asses Latham just on the policies that he took to the election or the neoliberal reconstruction of social democracy that was one of his trademarks.

It was, perhaps, John Howard himself who summed this up best when he called the 2004 election. He asked the people of Australia who they could trust to manage the economy, keep the budget in surplus, keep inflation under control and maintain downward pressure on interest rates. The theme of "trust" was the dominant one adopted by the Coalition in 2004.

John Howard was right to assert that trust was at the heart of the 2004 election. However, it was not trust in the way in which he publicly spoke of it. It was not a question of the broader electorate not trusting Latham, rather, it was corporate Australia that did not trust Mark Latham. If corporate Australia does not trust a Labor leader, as history amply demonstrates, then the media that it controls will prevent that leader from attaining office.

The popular media perception, one that is rarely challenged these days, is that Latham was a half-crazed maniac who did not have the stature to be the nation's leader. So it is that we observe that the phrase "the Latham debacle" has been firmly established as a part of Australian political phraseology. To be sure Latham was a colourful character, but none of his antics came within cooee of the drunken buffoonery of Bob Hawke in the 1970s, yet this did not prevent the corporate media from providing the decisive level of support needed for "the Hawke ascendancy".

The Federal Parliamentary Labor Party was the one institution that resisted the Hawke ascendancy right to the end only finally succumbing at the last possible moment, that is, at the same time that Malcolm Fraser called the 1983 election. The corporate media made Bob Hawke and then it destroyed him.

It would be wrong to suppose that Hawke had a "special relationship" with the Australian people. You can judge the state of the special relationship in the absence of corporate media support by the fact that nobody now cares much for Bob Hawke. Out of office he is of no further use to the rich.

During the internal review of Labor's organisation, that Hawke conducted with Neville Wran, an attempt was made to revive "the silver budgie" in the media but it fell completely flat, as do similar pathetic calls to "bring him back" after Paul Keating makes a public appearance.

The resistance of the Labor caucus to the Hawke tilt was an act of defiance against a corporate class, then promoting the Hawke bandwagon, that had done so much to destroy the Whitlam Government.

It is easy to forget now but the election of Mark Latham to the leadership of the Labor Party was an act of rebellion by the federal caucus, precisely on a par with the party's resistance to the Hawke ascendancy. That was the first mark against Mark Latham. In fact in his case this act of resistance was worse because the rich had supposed that the Federal Parliamentary Labor Party was no longer capable of such acts of defiance.

Once again, the ALP had to be taught the facts of life by the big end of town and its loyal servants.

Though his policies were motivated by conventional economic orthodoxy Latham nonetheless also displayed too many signs of being a working class warrior that did not think much of big business. The corporate boardroom undoubtedly picked up on this. The dominant image of Latham as a "maverick" really means that Latham, unlike Rudd and Keating, was unable, to his credit, to transcend his class background. Because of this the "ruling class", as he called it, could not and would not trust him.

It is in this sense that we should construe the term "trust" as used by John Howard upon calling the 2004 election.

Consider how, in the business pages of The Age, it was observed that "Mark Latham is an enigma for business. In his 10 months as Opposition Leader he has rarely discussed his business and economic views, and Australia's leading business lobby groups have had relatively little access to him."

The article furthermore noted that, "Latham intends to rid the economy of sweetheart deals and unacceptable business practices. He warns that a range of government grants, concessions and subsidies would be scrutinised and are likely to have to be justified on public policy grounds. His approach will do little to dispel concern that a Latham Labor government would be far from business as usual."

Latham's actions and statements since his political retirement tend to confirm this analysis, all of which are consistent with his well known speech to parliament on civility in politics. The language of class warfare permeates both.

Latham has spoken out squarely against the United States-Australia alliance, in essence an investor rights alliance, and is the only major contemporary commentator that dares to use the term "socialism". Every time he does so you just know that in Toorak and Double Bay, upon being confronted with another dose of Lathamalia in the Australian Financial Review, that they are feeling more than satisfied that they stopped him from becoming Prime Minister.

Kevin Rudd has learnt from the lesson that corporate Australia dished out to Latham. In the run up to the 2007 election The Australian reported that Rudd, "has a specific goal of meeting business groups - from boardroom lunches to meetings with business organisations - twice a week every week. Friday is his preferred day for high-level meetings." The report cites the ALP secretary, Tim Gartrell, as stating, "'we have to admit that under Mark Latham there was a rift between Labor and the business community. That has been well and truly healed,' he said." This healing process even included Rudd flying to New York as the supplicant before Rupert Murdoch, the enemy of organised labour everywhere.

None of the grand policies announced by Rudd demonstrate even the tiniest of hints that he seeks to develop, let alone enhance, a Labor redistributive agenda. Nor does he show any interest in seriously constraining the power and privilege of corporate Australia.

This is not to say that he has not fooled the intelligentsia, which is not a very difficult thing to do.

Conferences are organised under the comical title "the Rudd Revolution" (which has been appropriately cancelled) and Robert Manne was able to observe that "in its first year, the Rudd Government has begun upon an impressive, far-reaching and practical program of reform." He states, "already, in one area after another, his government has broken with the neo-liberal and neo-conservative trajectory of its predecessor".

Manne concedes that he can only draw upon micro-economic policy to make his case on the economy. Notice that this aspect of policy he divides into two components, automotive industry assistance and "nation-building". In so far as the car industry is concerned the government is not "picking winners". It is bailing out incompetent management, as in the US.

That is not inconsistent with operative neoliberalism, which is why President Bush is doing the same thing.

On "nation-building" Manne neglects to say that Howard dispensed plenty of pork for infrastructure projects. Indeed, the Liberal Party has argued that Rudd is implementing Howard era funded projects (like the Deer Park Bypass at my own Deer Park) and that current outlays are less than that promised by the previous government.

Manne equates Ruddian rhetoric with reality.

In office Rudd continues his servile relationship with big business. The Australian Financial Review reported that the Labor leader recently attended an Australia Labor Advisory Council meeting with union leaders, but that the meeting was "low key". It was explained that Rudd did not want to upset corporate Australia by giving off the appearance of being too close to his own people.

At the congress of the Maritime Union of Australia (ALP affiliated) both Julia Gillard and Anthony Albanese, of the Labor Left, refused to attend the congress dinner for the same reasons according to the preferred newspaper of the bosses, which comes replete with liftouts called Luxury and Boss in a sort of in your face reverse class war.

Indeed, Gillard's favourite phrase is "yesterday's battles" or some variant thereof. To support, for instance, conciliation and arbitration in industrial relations against enterprise bargaining or to support pattern bargaining would be manifestations of "yesterday's battles" according to Gillard. It appears as if anything that smacks of enhancing the structural power of labour with respect to capital, the purpose of a labour based party, is an example of "yesterday's battles".

The whole ideology of "yesterday's battles" was actually developed by the multi-millionaire "wunderkind" of the Victorian ALP, Evan Thornley, who stated to the Fabian Society that Labor must not be oriented toward labour versus capital, yesterday's battle, but must now choose sides in the conflict between owners of capital and management. He even stated that for organised labour "today's battle" is to support capitalists against managers.

Despite the emphasis placed on avoiding "yesterday's battles" this, alas, does not prevent Julia Gillard from holding the safe ALP seat of Lalor in the working class western suburbs of Melbourne. She holds her comfy seat in parliament by virtue of continued working class consciousness, but this does not stop her from doing the right thing by the establishment under the rubric of "yesterday's battles".

In fact, a extensive pre-Christmas profile in the Australian Financial Review demonstrates just how grotesque Gillard's betrayal of the proletariat has become. The profile, these things are always developed with the close support of the subject, wrote of her that "in government, Gillard has put distance between herself and organised labour". Moreover, "from several accounts, Gillard has grown more comfortable in the company of business people and the private school crowd". Notice the asymmetry.

Julia, next time you are out campaigning in Werribee Plaza or Altona Gate why not be honest and tell the public school slobs just how much you prefer the company of the "private school crowd"? In fact, Julia, why not go one better and resign your seat in parliament and go stand for election in Kooyong and Higgins given that you prefer the people over there so much more than those over here?

Gillard is able to hold her working class seat because she is not accountable to the people who elected her or to the genuine membership of the ALP. The former arises because she knows that the proletariat cannot vote Liberal and the latter because she knows that the ALP is an authoritarian organisation which is about as democratic as the Central Committee of the Soviet Communist Party was.

The two most significant Labor victories at the Federal level in recent times, in 1993 and 2007, occurred because the broader working class turned to the party for support in the face of a corporate led neoliberal jihad. They both support, rather than undermine, the thesis of the most astute academic observer of the ALP, Andrew Scott, who argues that if Labor continues to betray the Australian working class it risks its long-term future.

The best way to understand the Rudd and Gillard led "Labor" is by realising that Kevin and Julia have learnt the lesson, taught to them by "the Latham debacle", that they must earn and keep the "trust" of corporate Australia.

This has occurred in much the same way that Labor was disciplined by the socialist scare campaign of the 1949 election and beyond, a key dynamic behind the Whitlam leadership, and how the ALP was disciplined following the "Whitlam debacle", as pointed out by Graham Maddox from the University of New England, during the Hawke era.

Many observers have wondered what the "narrative" of Rudd and Gillard's ALP is. The "meta-narrative" is one of surrender. They have been disciplined by "the Latham debacle" towards unconditional surrender to corporate Australia. The ideology of "yesterday's battles" is a proclamation of capitulation.

It's little wonder then that Mark Latham has become the most incisive left wing critic of Rudd Labor for surrender was not the Latham style.