Coming: The Age of Australian Corporatocracy

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(Image via @SirThomasWynne)

The Abbott Government's neoliberalism is skewing the balance against the sovereignty of the people in favour of the sheer might of the corporation. Professor Carl Rhodes examines the rise of corporatocracy in Australia and our loss of democracy. 

IT IS A sign of the Abbott Government’s political and economic values that the failure of a bill attacking trade unions could be what sparks an early election. If this happens, it would play to the conflict between labour and capital that has long defined the division between the right and left of politics.  

Abbott wears his political economy on his sleeve. Never shy of a slogan, “Australia is open for business” has become his refrain. He first declared his openness when he took over as Prime Minister in 2013.

The sloganeering continued when he used the same line as the catchcry of his 2014 trade visit to the United States. In that case, it was emblazoned on banners as he smiled and rang the bell to open the New York stock exchange.

It was back again last month at the signing of the China-Australia Free Trade Agreement.    

Abbott heralds corporate capitalism and free trade as the route to prosperity for the nation as well as for individual Australians. 

But is the economic tail wagging the political dog?

Politics for Business

Business means a lot to Abbott and his government. Since elected, he has embarked on a series of actions intended to promote corporate supremacy and freedom.

The ideology he professes and the policies he pushes are all led towards making business – especially corporations – more powerful. The agenda to achieve this is small government, free markets, international trade, weak unions, disavowal of the class system, user pays public services, and a shrunken welfare system. 

After a campaign fuelled by generous corporate donations, he abolished the carbon tax, proselytised that coal is “good for humanity”, sought to surrender universities to the free market, threatened universal healthcare, attacked trade unionism, and worked on reducing penalty rates for the employed and benefits for the unemployed. 

In the “battlelines” in which Abbott fights, labour – as a political party and as a class of people – are his declared enemy. Business and the wealthy elite are his allies; maybe even his heroes. From the legacy of his captain’s calls, to his respect for the British monarchy and to his disdain for the process and institutions of democracy Abbott, himself, often behaves more like a ruthless CEO king than a leader of a democratic nation.


Democracy is a system of government where ultimately political power comes from a nation’s citizens. Democracy dethrones the king and declares the people as sovereign. The collective citizenry is the source of political authority that should be superseded by no other person or institution.  

Although Abbott’s economic and trade policies promise prosperity, they also serve to transfer power away from the people and towards corporations. This is a move from democracy to corporatocracy, all the while preserving the role of the state as the political arm of business.

As business, commerce and trade are pursued by the government, there is less worrying being done about domestic competition. Australia’s corporations are powerful both collectively and individually. Whether they be in banking, retail, mining, media or telecommunications, Australia’s biggest corporations operate exclusively in monopolistic, duopolistic or oligopolistic markets. 

As democracy withers, inequality widens. The top one per cent, populated by big business capitalists and CEOs, claims more and more of the nation’s wealth and income. This is a government that serves the market and its powerful actors. It draws political legitimacy from business and corporations, rather than from people and civil society.

As one would hope, the economy is central to government policy. Sadly, the equality of how the income and wealth generated by the economy is distributed is of far less concern. That is part of how corporatocracy works. Australia is a wealthy country, but that wealth is shared more and more inequitably.

Trading Sovereign Power

International trade agreements are the apogee of the burgeoning sovereign power of corporations. While important, the China-Australia Trade Agreement signed in June was just a step on the road.

The big prize is the Trans-Pacific Partnership (TPP). Negotiations have been done in secret, and what we know is only through leaked documents. The agreement is about increasing trade around the Pacific, but way that this will be achieved is through political as much as economic means. 

Central to the proposed partnership is the Investor-State Dispute Settlement (ISDS) clauses. This clause stipulates that special tribunals would be established where corporations could sue any country whose laws impeded its pursuit of profitability.

This represents the apex of a long trend of corporatocratic governments shifting power from the people they notionally represent to corporations. The ISDS reverses the idea that corporations and beholden to the laws of the state. It insists a precedent whereby the law is beholden to the dictates of corporate profitability.

Despite the leaks, it was intended that the details of the agreement would not be made public until after it was signed. This would mean of course that public debate was entirely and deliberately eliminated from the process. 

Of the Corporation, For the Corporation

Abbott’s government, funded into office by the big end of town, is a government of, for and by the corporation. Citizens are just a means, not the ends, of economically driven politics where the corporation is sovereign.

As for the individual citizen, anyone can get on in life so long as you, as Joe Hockey says“get a good job, that pays good money”. If, for some reason, you can’t get a good job then you are left to the mercy of a political and economic system that claims to offer nothing. You will get what you deserve.

Abbott echoes a neoliberal exhortation of commerce and individualism. It is delivered from the seat of white male privilege, just with an Australian accent and an added dose of macho brutality. 

In contemporary Australia, individual citizens can be condemned as being dole bludgers, or leaners not lifters, but corporations get a much broader berth. 

Major Australian and multinational corporations are given generous tax deductions, exemptions and incentives. With what’s left, they are able to shuffle profits around the world to bring the tax bill down even further. 

While welfare benefits for citizens are under attack, if a bank is in trouble it can expect to be bailed out by putting its hand deep in the public purse.

"We are living in a plutocracy in Australia, that is government by the wealthy in the interests of the wealthy” ~ Sen Christine Milne.

After Democracy?

The corporatocracy being instituted in Australia is far from complete. Democracy cannot be undone that easily. 

But what we are getting from the Liberal Party is a ticket on a coal-powered and bank-financed train headed away from democracy. This is a politics that is no longer defined by the distinction between left and the right. It is a battle for the very system that enables political difference to exist in the first place. 

Our choice, in that we might still have one, is between democracy and corporatocracy. At present, the balance is skewing against the sovereignty of the people and in favour of the sheer might of the corporation.  

You can follow Carl on Twitter @ProfCarlRhodes.

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