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Are the Coalition's neoliberal policies really paying off?

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Treasurer Scott Morrison (screen shot via abc.net.au).

The Coalition has been crowing about the latest job figures, but are the claims justified? Mike Dowson thinks the data tells a different story.

I GREW UP WITH working people. The women were always buying lottery tickets. For them, it was as probable as any other path out of drudgery.

Working people accept the yoke of servitude. They don’t like slackers among them. But they never stop dreaming of a better life. Whether from hard graft or the hand of fate, they long for the opportunities that come with affluence.

It is, therefore, a great irony that now technology has made much labour unnecessary, we are unable to embrace freedom. Today, young people dream not of freedom but of finding a job. We cleave to huckster politicians who pander to the private sector’s every whim for the favour of creating them.

If we are to believe Prime Minister Malcolm Turnbull, Treasurer Scott Morrison and others, it’s paying off. A casual glance at the economic figures seems to support them. But it behoves responsible citizens to look past the PM’s rabbit to the hat he pulled it from.

Which Coalition Government fixation would it be that has reinvigorated Australian business? Punishing refugees? Shutting down renewables? Hounding jobseekers? Trying to prevent gay marriage?

A look at the data shows that it isn’t our magnanimous private sector, under the Government’s inspired leadership, that is sprouting jobs. Our ageing population – and the NDIS rollout – have directed public funds and private savings into care work. And our rapid migration-based population growth has spurred demand for housing.

The latter is also where a big chunk of the revenue derives for the freeways, stadiums and additional construction jobs beloved of our big-spending East Coast State governments.

Unfortunately, while these trends boost private sector profits, most new jobs are low wage and wages overall are frozen. Household spending power continues to decline and where is it going? Housing again. It’s an economy that Matt Barrie likens to a house of cards.

I have sat in many boardrooms over many years with senior execs from all kinds of businesses and I can truthfully say that no one has ever expressed any interest whatsoever in creating jobs. On the contrary, reducing the cost of employment, through automation, offshoring and outsourcing, has been a constant theme.

Big companies will hire when they have new business and neither a robot nor a low-wage foreign worker can fulfil it. Those exceptions are fewer every day. And where does new business come from? The same place it did 200 years ago: customers with money to spend.

That rule applies to small business, too. Cutting wages doesn’t help them in the long run because it reduces domestic spending power. If you really want to help small business and improve local employment, reduce the cost of real estate, which diverts everyone’s hard-earned cash to banks and landlords.

Well-run companies want you to have lots of money. Why? So you’ll buy their products. But they don’t want to give you a job. Employing people is a pain. They’d prefer your money comes from someone else’s payroll.

Of course, business leaders argue vociferously for lower wages. It’s their job to maximise profit, not to ensure the system works. They’ll be off in a few years, dragging their giant bonuses — which, in any case, are based on the share price, not on the company’s long-term viability.

So whose job is it to maintain the system? We have an ancient solution for that. It’s called government. The trouble is our politicians don’t know it’s their job. They think they should leave everything to "the market". But "the market" is the same people who only care about profits. That’s why only profits are improving. No one is looking after the system. Why would we be surprised it isn’t working?

Even now, with the next wave of automation still to arrive, many jobs are unnecessary. As anthropologist David Graeber found, the incumbents often know this. Even people in useful jobs spend copious time on emails, meetings and reports, that merely give someone else something to do.

But a lot of work happens. That’s the whole point. Whether it’s beneficial or not is irrelevant. When people work, they can go into debt — to buy overpriced real estate and plough money into super. This generates huge profits for bankers, builders and insurers.

But what would people do if they didn’t work? Probably what they do now with financial independence. Relax, volunteer, care for others, study, travel, make things, start new ventures. Some of them might need a hand adjusting. Communities in trouble would require special care. That would lead to new jobs. What exactly is the problem?

A universal basic income, with a job guarantee for community-endorsed projects, would give millions of underemployed people greater economic participation. And, unlike the profits that get hoarded, that benefit would flow on to the rest of the community, including those in regular work.

If we also reduced regular working hours and expanded leave entitlements, European experience point to gains in mental and physical health, as well as productivity.

Ambitious people could still get rich. Others could live simply, doing what they love. Without the threat of destitution, more would take risks and innovate. Many would welcome reduced competition for regular jobs.

But how would we pay for it? That’s the wrong question. Productivity-expanding technology already exists. But lazy capital is declining to invest and workers are evading it, rightly suspecting that any dividend is likely to be syphoned off at their expense.  

This is where it comes in handy to have your own currency. A sovereign government can spread the benefits through social programs and, as economists like Stephen Hail have shown, mobilise spare capacity with debt-free spending. But only if it takes orders from citizens instead of plutocrats.

Wouldn’t we need to raise taxes? Again, the wrong question. Have you been listening to the plutocrats’ propaganda?

We don’t need to get the money from somewhere. We just need to prevent it from flowing into tax havens and asset price inflation. If we plug the gaps and remove the rorts, the rich can’t suck new public spending out again as economic rent.

What that class offers, to protect us from the dread prospect of a life of freedom, leisure and creative expression, is longer hours for lower wages in lesser occupations with little security. But we can still have jobs — some of us. The lottery winners of the new era.

We seem to have fallen down the rabbit hole. Our politics is infantile. It’s dragging us backwards, towards the exploitation of the 19th Century. Our public discourse is more like the Mad Hatter’s tea party than a consideration of our actual circumstances.

'We don’t need to get the money from somewhere. We just need to prevent it from flowing into tax havens and asset price inflation.'

You can’t help feeling like Alice, trying to find your way through a shadowy land of privately sponsored nonsense and innuendo.

In this topsy-turvy realm, it won’t matter that young people work as cleaners and baristas, up to their eyeballs in debt and can’t afford to live anywhere, as long as growth is strong and the government budget is in surplus. Neither of which, by the way, is presently more than wishful thinking.

Also, those weather events that are like the ones the climate scientists predicted? They’re the weather events the climate scientists predicted. Don’t assume wealth and influence can protect anyone. Nature won’t care which private school they went to — nor will an angry mob.

Does it matter that our corporations are automating jobs and sending them offshore, along with the profits? Only if our government can convince a hypnotised electorate that cutting corporate taxes is the way to fix it.

No doubt, there will be new jobs that are beneath even a robot. Of course, we may end up working for a bowl of gruel. Perhaps we’ll need to bring back the lash.

Alice’s real problem is that she’s dreaming. The solution for us is no different. We need to wake up.

Mike Dowson is a private management consultant. 

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