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Prelude to major system change?

By Klaas Woldring - posted Thursday, 11 April 2013

The objective of this article is to demonstrate that major system and ideological changes are needed to take Australia forward. The Australian voters may well be desperately looking for political leadership to generate such changes.  The Golden Age myth may not be a particularly relevant concept now unless one refers to a period like the early 1900s when Australia introduced a series of remarkably progressive social and political reforms. Some of these were quite heroic and advanced by then contemporary standards.

In addition, there was the short burst of major reforms, in the Whitlam period (1972 – 1975) that many seem to have forgotten now: establishing Telecom and Australia Post, withdrawing troops from Vietnam, abolishing university fees, establishing Medibank, ending conscription, releasing conscientious objectors from jail, opening diplomatic relations with China, giving independence to PNG, amalgamating the army, navy and air force, taking sales tax off women’s sanitary products, appointing the first women’s adviser, ending appeals to the Privy Council in England, instituting an Australian honors list, pushing land rights for indigenous Australians and introducing the policy of multiculturalism. These were partly policy and partly governance changes.

They frightened the conservative horses greatly. Whitlam was removed but, to his credit, his successor Malcolm Fraser basically maintained the new policies. But something else had emerged in the Western world, post WWII Keynesian policies were phased out and neo-liberalism began to take hold: keep governments small, let the markets rip, deregulation and privatisation and competition policy were praised for their own ideological sake. People were encouraged to talk about “customers” everywhere instead of passengers, clients, students, patients, etc. Even Labor Governments in Australia adopted a large chunk of the neo-liberal agenda, e.g. the Hawke and Keating Governments. Many of the privatisations were actually introduced in that period, others under Howard. The reintroduction of uni fees started in 1988. However, governance changes, as system changes, hardly happened. Local government inclusion in the federal constitution failed on two occasions, on account of Coalition opposition in Referendums. Hawke rejected the European type industrial relations reforms recommend in the 1987 Australia Reconstructed Report. Even a very minimalist Republic favoured by Keating and Turnbull was unachievable.


What is perhaps of more direct relevance now is the notion that Australia has come through the Global Economic Crisis successfully, thus far. That crisis, almost entirely an inexplicable surprise to the neo-liberal gurus and corporate executives, is still with us. Australia’s four major banks, not de-regulated, and a major mining boom, helped to withstand the threat thus far. However, this success masks structural, economic and environmental problems that could seriously threaten the future. Many of these problems are the direct result of governance weaknesses; and a deplorable reluctance to political, industrial relations, electoral and constitutional reform by both major parties. Several community groups and social media channels have emerged in recent years that do show great awareness and keenness  but their capacity to actually influence system changes is still rather limited. Voters have very limited choices even though, as in 2010, many voted for non-major parties’ candidates. Moreover, their positions are largely shaped by powerful traditional media who consistently fail to promote debate about system alternatives.

The dominance of neo-liberalism is being questioned.

A few days ago Frank Stilwell, retiring first Professor of Political Economy of Sydney University, was honored at a special conference devoted to the discipline and his innovative career. Political economists favour a heterodox approach instead of the orthodox classical approach that chiefly inspires the neo-liberal economists. There were a great number of contributions by other political economists covering several sub-disciplines. Stilwell’s own contribution, explained in his 2000 book Changing Track - the Fourth Way, tackles the inequalities, insecurities and alienation resulting from the neo-liberal domination. He also points out that the notion of 5% - 6% unemployment being satisfactory is false, that measurements like GDP are inadequate for many social and environmental purposes. Governments have a major role to play in the capitalist economy, as Keynes, not a socialist himself, already demonstrated in the 1930s.

It was interesting that Griffith Uni academics Murray, G. and Peetz, D. demonstrated in their joint presentation that inequality of incomes had grown significantly since the early 1970s in the Western world, especially in the Anglo sphere. However, at the same time, productivity of the workforce had steadily declined over the same period. That is certainly the case in Australia. Furthermore they demonstrated that, as have many other researchers in the US as well, that there is no correlation between executive achievement and their salary packages. Thus the absurdly high executive incomes have no real justification on the basis of merit. This was also established by the Productivity Commission during its Inquiry in 2009. Disappointingly, we find that only a weak response by the Federal Government resulted. Providing some additional power to shareholders to question the Corporate Remuneration Reports suggests that they baulked at taking on the big end of town. If this continues Australia will end up as a plutocracy rather than a democracy, which it still claims to be.

The Traditional Media role.

The role of the traditional media in Australia to promote the fortunes of political parties sympathetic to neo-liberal values and interests has been given considerable attention in recent weeks in Australia following the half-baked attempts to introduce six laws aiming to create more diversity in the media.


Some journalists, the political commentariat, operate as a group of extra-parliamentary, unelected politicians. They seem to function plainly as agents of the growing plutocracy. This is particularly the case with News Corporation’s media outlets. The onslaught against the Gillard Government has been relentless. As they have 70% of the newspaper circulation, plus airtime on radio and TV stations, this has been a major handicap for the Gillard Government, in spite of a mainly credible performance.

Fairfaxpapers have also undermined the Gillard Government consistently. Several keep telling their readers that Gillard has been a “poor campaigner” and a “disaster” as a PM. These same apparently highly qualified writers informed readers that the winner of the drama was Tony Abbott. Their favourite PM appeared to be Kevin Rudd but the spill was a non-event because his backers stuffed up and he didn’t want to be a candidate any way. Notions that the Gillard Government is virtually certain to lose the September federal election are basically presented as fact. In reality such claims are irresponsibly premature, superficial and/or based on wishful thinking. The polls favour Abbott but they do not indicate the intensity of support for the Coalition under Abbott at all. If Gillard came up with bold new policy, favoured by the voters, the tide could well turn rapidly. Apart from shooting themselves in the foot a couple of times, they haven’t done much wrong. We should ask what areas of system change could be identified other than the long overdue media diversity?

Areas of system change and governance reform.

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About the Author

Dr Klaas Woldring is a former Associate Professor of Southern Cross University.

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