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Social democracy under consumer capitalism

By Clive Hamilton - posted Saturday, 15 June 2002

Since the early 1980s, many of us have been searching for a coherent alternative to neo-liberalism, for a way of reinventing social democracy in an era of global consumer capitalism. We have failed miserably. The left has been wandering in the wilderness, mouthing the old slogans to a world that is no longer interested, distraught at its irrelevance, but not knowing where to turn.

The vacuum has been filled by the pallid apologetics of the so-called Third Way - Thatcherism with a human face. The Third Way is the way that no-one can define, a program in search of a rationale, a social analysis in which conflict is conveniently replaced by complexity, and in which any talk of power is taboo.

Around the world, we have seen the parties of the left transformed into their opposite, with the spin doctor elbowing out the policy advisor. They have increasingly become parties for politicians who are not sure what they stand for but which employ advertising agencies to convince us that they stand for something. The Third Way is essential to the new dispensation of political convergence in which the historic battle of ideologies has been superseded by product differentiation.


The left itself is responsible for this state of affairs. It remains wedded to a view of the social order defined by class, exploitation and inequality. Difficult as it may be to admit, social democrats and democratic socialists have a psychological predisposition to believe that the mass of people are suffering from material deprivation. We thrive on the imagined wretchedness of others. When the economy goes bad we feel secretly vindicated, for our reason to condemn the system is renewed.

But we must face up to the facts – the left’s "deprivation model" is today the opposite of the truth. The dominant characteristic of contemporary Australia is not deprivation but abundance.

By any standard Australia is an enormously wealthy country. The great majority of its citizens want for nothing. In 1950, average real incomes were around $9,000; today they are more than $30,000. Average households today are filled with big-screen TVs and DVDs. When we overfly the suburban expanses of Sydney, we see backyards dotted with swimming pools. It is nothing for an average parent to spend $1,000 on a present for a child or to buy them a personal mobile phone. Ordinary families happily shell out $40,000 for a four-wheel drive play-thing and gamble away a few thousand dollars each year merely for entertainment. They avail themselves of sophisticated healthcare when it’s needed. Almost everyone has access to good quality primary and secondary education.

In real terms, Australians today are at least three times better off than their parents were after the war, and the fact is that the distribution of income is about the same. Of course, there is a residual at the bottom who are struggling. We still have poverty (and, let’s face it, we probably always will). As a society we have an obligation to attempt ceaselessly to eradicate it. But why does the left continue to base its entire social philosophy and political strategy on the circumstances of the bottom 10 or 20 per cent? Concern for the underprivileged should not provide the driving force for a politics of social change in a society where the daily experience of the great majority is occupied not with how to pay the bills but with how to enjoy their unprecedented wealth.

The model of society where the dominant social evil is want has been rendered irrelevant by five decades of sustained economic growth. It might be argued that the left is concerned not with material wealth but with exploitation. But it is impossible today to argue that the mass of people in industrialised countries is exploited, at least not in the way the left has traditionally understood the term. Both the structure and nature of classes are fundamentally different. Liberation itself has not been denied but co-opted by consumer capitalism.

Modern consumer capitalism is wracked by a great contradiction – that between the promise of consumer capitalism and the modern social condition. Despite the fantastic promises of material progress, and the extraordinary success of capitalism in delivering undreamt of wealth for ordinary people, the people are still not happy.


In the USA, where consistent surveys have been conducted since 1946, real incomes have increased by 400 per cent, yet there has been no increase in reported levels of well-being. Indeed, the proportion of Americans reporting themselves to be ‘very happy’ has declined from 35 per cent in 1957 to 30 per cent in 1988, while the percentage who said they agreed with the statement that they are ‘pretty well satisfied with your financial situation’ fell from 42 to 30 per cent. The story is the same in Australia.

The growth project has failed; but it is too threatening for people to admit it. In the USA, there is virtually no difference in reported levels of life satisfaction between people with incomes of $20,000 and $80,000. Overall, over half of the population of the richest country in the world say they cannot afford everything that they really need. And it’s not just the poorer half.

The pursuit of wealth is not making us any happier. It is not simply that other trends in society, occurring in parallel with rising incomes, have offset the benefits of wealth; the process of economic growth itself has produced a seriously sick society. In a mass of evidence from the USA, mirrored by studies in Australia and other rich countries, the richest people in the world are saying that they are miserable, that it’s not worth it, and, most disturbingly of all, that the process of getting rich is the cause of the problems.

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This is an edited extract from a speech to the National Left ALP/Trade Unions Conference at the Humanities research Centre, ANU, Canberra, 11 May 2002.

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About the Author

Clive Hamilton is professor of public ethics at the Centre for Applied Philosophy and Public Ethics.

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