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Friday, April 21, 2017

Social Democracy and Capitalism : A Critique





originally written for a Fabian Society Forum ; Melbourne ; 19/4/2017

A finalised version of this will be submitted to ALP policy development bodies for consideration ; PLS provide feedback if you think it may help me improve the final version...

Restoring 'a traditional social democratic mixed economy' is part of the solution to current economic maladies ; but at the same time it is only the beginning of the journey...

by Dr Tristan Ewins , April 2017



Capitalism and its benefits



1)     Capitalism is an economic system based on the private ownership of the means of production, exploitation of labour by Capital, and markets as vehicles for distribution and exchange.  



2)     Capitalism has benefits and failures ; which can be maximised or ameliorated via economic policy, and by the struggles of ordinary people for justice



3)     Capitalism as we know it has the benefit of promoting innovation through the dynamics of competition ; The competitive market system drives capitalists to innovate and respond to the intricacies of consumer demand.  It also leads to the development of the means of production.



4)     Capitalism also has the benefit of driving efficiency and productivity gains via those same dynamics of competition





Capitalism’s Flaws





5)     But Capitalism’s failures include the following



Canadian economist Jim Stanford estimates that ‘the capitalist class’ of top owners and management dominates control of the economy despite only comprising about 2 per cent of the population.  This has implications for the viability and meaningfulness of democracy.



Capitalism has also always involved a ‘business cycle’ ; characterised by fluctuations in consumer demand and investor confidence. This could be sparked by the collapse of investment bubbles and the spread of ‘bad debts’; and in response to the use of interest rates to contain inflation , or because of ‘supply shocks’. (eg: the Oil Shocks of the 1970s)   And these crises spread in the context of world capitalism because of increasing global economic interdependence.  At its worst this has occurred in the context of Depression , and more recently with the Global Financial Crisis.  These were only eventually overcome in the context of stimulus , government guarantees and other interventions , and in the past (eg: WWII and post-war reconstruction) also because of the ‘boost’ provided by rearmament and war.   The Great Depression put paid to the economic Liberal argument that ‘perfectly free markets’ ensured the full mobilisation of all ‘factors of production’. Arguably the right kinds of stimulus, intervention and regulation can reduce the severity and duration of the associated downturns.   This includes what Keynesians call ‘demand management’.  Downturns are a good time to invest in infrastructure, for instance ; though there are arguments to invest in productivity and quality-of-life enhancing infrastructure outside of that context as well.  Indeed stimulus can create ‘a multiplier effect’, creating jobs indirectly as well as directly.  But government (or ‘the people’) should not shoulder all the costs and risks, here ; with little in return.  Some of the concerns socialised to restore stability during the GFC should arguably have remained socialised.



6)      Left to its own logic capitalism leads to economic monopolisation or oligopolism – which in turn can lead to the abuse of market power.  It also leads to systemic inequality.  Though this can be ameliorated through labour activism , labour market regulation , progressive tax , and the social wage and welfare systems.  And also by competition policy ; or enforcement of competition via Government Business Enterprises with charters on promoting competition. Again, though, the ‘capitalist class’ as such comprises only 2 per cent of the population ; and yet has the power directly or indirectly to veto any public policy through destabilisation and/or a ‘capital strike’.  Unless ‘the people’ are sufficiently conscious and organised to oppose those strategies.



7)     Nation States also pursue their economic interests attempting to extend their economic sphere of influence through control of – and access to -markets in other countries (including key strategic resources) ; or in the past through more direct expansionism.  This can involve military force or economic and cultural pressure ; and was described by the British liberal social theorist John.A.Hobson as “Imperialism” ; a term which was then seized upon by Vladimir Ilyich Lenin to explain the First World War.



8)     Marxists once believed in ‘absolute pauperisation’  and ‘absolute bifurcation’  under capitalism; with the destruction of the middle classes through the dominance of monopoly capital and the inability of small business to compete.  In reality the ‘middle classes’ have re-emerged in diverse forms.  Via the professional classes ; via emerging small businesses in new industries where monopolies have not yet consolidated ; and more recently as contractors who compete against each other to provide goods and services for monopoly capital , or in other contexts via small jobs for private consumers and households. Meanwhile, the working class generally includes all wage labourers – skilled and unskilled, manual and mental.  The wealthy , and Ideological economic Liberals and capitalists, try to play the middle classes off  against the working classes and the disadvantaged.  As well as playing the working classes off against the most vulnerable with ‘anti-welfare’ narratives ; and using narratives around ‘political correctness’ as a wedge against the progressive liberal, social democratic and socialist Left.  Also capitalists try and play manual labourers against intellectual labourers ; appealing to intellectual labourers that they are ‘middle class’. (and hence do not share the same interests)  In democracies the challenge is to build a stable progressive electoral bloc to fight this.  Swedish sociological theorist Walter Korpi referred to a ‘democratic class struggle’. Arguably Labor could do better to consolidate its support bases around the working classes and the vulnerable by playing more directly to their interests and challenging dominant Ideological themes; while maintaining the support of middle class liberals.



9)      Current emphasis on ‘no real wage rises without productivity improvements’ leaves some labour-intensive professions (eg: cleaners) with little or no prospect of a real wage rise, ever.  That is: without increases in the intensity of labour – a disturbing notion given we are already talking about some people who are engaged in hard and demanding physical work. Hence the creation of effective poverty traps. Workers in other areas like Primary and Secondary Teaching would also be hard pressed to achieve ‘productivity gains’.  It also leads to absurd scenarios ; for example in higher education ; with academics measured by  their ‘academic output’ ; often excluding deep thought and study of particular areas ; and getting in the way of good teaching.



The Imperative of Capitalist Expansion ; and the Associated Waste


10) Capitalism involves a dynamic of expansion ; Its survival depends on it.  Waste at various points in the production process means capitalism must continually expand into new markets – or more thoroughly exploit old markets - to remain viable.  That waste includes cost structure duplication because of competition, and also the cost of continual revolutionisation of the means of production to maintain competitiveness.  There are also areas of unnecessary costs in areas such as marketing, dividends, executive salaries, and so on.  Getting rid of this waste and duplication could arguably be qualitatively good for the economy, and for consumers : freeing resources to be deployed elsewhere.  Decisions need to be made as to where natural public monopolies are viable (eg: transport and communications infrastructure) ; as well as where existing corporate competition (eg: Samsung versus Apple) actually does drive innovation which improves peoples’ lives.



11) There is also extensive waste in other areas.  For example the fast food industry involves enormous waste ; and domestic food consumption alone also involves $8 billion of waste every year.   But approximately 2 million Australians depend on food aid every year.  Also there is the spectre of planned obsolescence (for instance white goods and electricals): that is, things are not made to last because that ‘would be bad for business’.  This might warrant some kind of regulation re: minimum warrantee length for said electricals, whitegoods and so on.



12) But also there are limits to how far capitalism can succeed by extending its reach into new markets or more thoroughly exploiting old ones ; Over the past century capitalism has driven greater labour market participation: for instance that of women.  It has integrated most of the world economy also.  Now capitalists are demanding changes which grate against social democratic principles, interests and values.  This led to what social theorist Jurgen Habermas called a ‘Legitimation Crisis’.  That is, capitalism could not or would not deliver any longer on the post-WWII social democratic historic compromise.  This was dealt with in the form of attacks of social democratic Ideology ; that is – convincing people to renounce their own social and industrial rights on the basis that neo-liberalism, greater inequality, privatisation, and austerity were ‘natural’, ‘inevitable’ and according to Margaret Thatcher that ‘There is no Alternative’. (‘TINA’)  This also involved twisted Ideological narratives of individualism and meritocracy which ‘naturalised’ and justified inequality and exploitation.



13) In response to the systemic imperative to expand into new markets – or more thoroughly exploit old ones - capitalists are demanding increases in labour intensity, longer working lives, and longer working days.  Capitalists are also pushing down on wages, conditions, welfare, the social wage and so on – to ‘create room’ for profits.

 

14) But this creates as many problems as it solves. Cutting welfare, the social wage, and so on may provide a short, local boost to profits of particular enterprises.  But it also reduces consumer demand and consumer confidence , and probably increases the costs of crime.  As well there is an intensification of inequality, and a hit to quality of life.  We are producing more on this planet than ever; and yet we are told we most work longer and harder ; and not simply enjoy the benefits of greatly improved productivity in some areas.  Also capitalist measures of production (eg: GDP) often take no account of social capital, and the benefits of voluntary work, and ‘intangibles’ (to capitalism) such as free time, happiness and the environment.



15) Left to its own logic capitalism creates great inequality. Certain social democratic policies can ameliorate this without a full transition to a qualitatively different economic system or mode of production.  (which is not currently an option)  Though we should not feel inhibited in imagining alternatives ; and discussing where current problems could ultimately lead.


Socialisation  and the Welfare State could still  ‘Save Capitalism from Itself’


16) Firstly, a bigger public sector can actually be ‘good for capitalism’ to a significant degree.   Reversion to natural public monopolies in several areas could reduce cost structures, creating efficiencies which flow on to the broader economy.  This includes in communications, transport infrastructure, energy, water, and potentially with a single public-sector job search and welfare agency.  Cost structures would be reduced because of a cut in waste, duplication and unnecessary or inappropriate competition (eg: in energy) ; as well as because of a superior cost of borrowing for Government.  Again there are some areas (eg: energy) where ‘competition’ is ‘anti-intuitive’ for consumers ; and confusion leads to abuse of market power by energy retailers.  For policy makers there is also the danger of nepotism through the privatisation process ; including Public Private Partnerships which facilitate the ‘fleecing’ of consumers.



17) Secondly ; while capitalism needs to expand into new markets to survive, at the same time it undermines itself insofar as in its current form it is failing to create full time work for all those who want it. It is also failing to create full employment for all who want it; and indeed depends on ‘a reserve army of labour’ to discipline workers into accepting its demands on wages and conditions.  Proactive industry policies should endeavour to create full employment , and full-time employment for all who want it.  This involves the more thorough exploitation of old markets and well as taking advantage of new ones.  And with real creativity government can act as ‘employer of last resort’ through programs which provide for genuine social goods ; not merely pointless schemes ‘painting rocks’ and the like.



18) Further, strategic government business enterprises in areas like banking, general insurance, medical insurance – could counter attempts by private oligopolies to exploit their market power and fleece consumers.  That would mean more disposable income for average consumers upon whose demand the economy depends.



19) Finally, as the Nordics have shown , growing the social wage and welfare state is also good for people ; good for the economy. Greater equality can mean greater happiness ; and also greater consumer demand – as those on lower incomes spend a greater portion of their income.

Through these strategies capitalism can be made ‘more survivable, more fair, and more stable’.  These do not provide a final answer for capitalist instability and injustice.  But ‘with no way out’ for now to a qualitatively better system of production the amelioration provided by such responses is crucial for those who will have to live and work under capitalism.

Better Outcomes for Consumers, Workers, Taxpayers…



20) The Social Wage and Welfare State can also contribute to happiness and well-being by providing a living income for the disadvantaged and vulnerable , and support for carers.  The social wage, welfare state, and other areas of state provision (eg: infrastructure) can also provide a vehicle for ‘collective consumption’ by taxpayers via the tax system – providing much better value for money than were the associated goods and services purchased by atomised, private consumers.  As already alluded to ; the same applies in relation to ‘collective consumption’ with regard natural public monopolies re: certain infrastructure and services ; and in areas of health, education and so on.  Even if people pay more tax over the short term, they end up better off – with more disposable income after non-negotiable needs are provided for. 



The social wage and welfare state demand higher taxes as a proportion of the economy ; but for the reasons stated actually tend to leave most people materially-better-off.  And with more choice ; that is, more purchasing power – not less - after essentials are provided for.



Democratic Socialists and Social Democrats must look to the best tax mix also. The overall tax mix must be progressively structured.  Arguably for fairness corporations and the wealthy must pay more ; as far as it can be sustained. If there are consumption taxes, for example (perhaps to prevent tax evasion), the bad distributive effects of this must be fully offset through progressive taxes and social wage measures elsewhere.  A bigger role for progressive income taxes, taxes on dividends, taxes on wealth and capital – is desirable.  Social security, welfare and the social wage (perhaps including a guaranteed minimum income) must raise the ‘floor’ of inequality as high as can be fairly sustained. (that is, higher minimum wages, including the effect of the social wage)  Currently there is exploitation of the low paid and unreasonable inequality in the labour market and in wealth ownership ; but there are arguments that reasonable reward for effort, unpleasant labour, past study and skill - should be factored in. (as most people accept)  There should be much less inequality ; but some inequality is justified even under democratic socialism.



Tax can also comprise a ‘lever’ for gradual socialisation over the long term in strategic areas of the economy.

Finally the broad Left and Centre-Left cannot morally abide by a system which uses the threat of descent into an ‘underclass’, or classes of ‘utterly destitute’ and ‘working poor’ – as a way of ‘disciplining’ other workers. Neither can we tolerate ‘middle income’ demographics having their material living standards (interpreted here as material consumption) rest upon exploitation of the working poor. What is needed is broader solidarity to the point where there is no class of working poor or utterly destitute. 



21)  As well the social wage and welfare state can provide the following:  High quality, comprehensive universal health care for all ; Providing  high quality Education for all – including education for personal growth, political literacy,  and hence preparation for active and informed citizenship; as well as education to meet the demands of the economy and the labour market.  Other important areas include public and social housing, legal aid , child care, financial services, access to information and communications services and technology , assistance for equity groups , Public sector media such as ABC and SBS with charters to maximise participation, support extensive pluralism, support local culture ; Broader support for diverse local culture, recreation, sport, and so on.  Creating ‘the good society’ involves more than ‘hands off’ and ‘leave it to the market’. New needs are also always arising as the economy and technology develop.



22) Further ; there is a growing push for a ‘guaranteed minimum income’ for all ; which makes sense given the looming problem of distributing the productivity gains of future automation ; But also providing a ‘basic floor’ below which no citizen will be allowed to fall.



Automation is inevitable and governments must intervene to ensure the full economic benefits are passed on to workers and consumers.



23) The emerging economy should provide flexibility where possible on workers’ terms.  Again ; Those wanting part-time work should be so provided.  And those wanting full-time work should be so provided.  All people should have the prospect of a fulfilling life ; with a mix of varied manual and intellectual labour.  There should be scope to devote time to personal growth ; including creative labour , study and recreation.  Industry and labour market policies must aim to update skills, and also strive to nurture new industries which draw on existing skill sets where jobs have been lost. 



24) As Professor Andrew Scott explains in his work ‘Northern Lights’, the Danes have a policy they call ‘flexicurity’. Rather than focusing narrowly on 'flexibility for employers to dismiss workers', the Danes also emphasised 'the provision of generous unemployment benefits for those who lose their jobs' and 'the provision of substantial and effective Active Labour Market Programmes (ALMPs), [with] quality training to help unemployed people gain new skills for new jobs …'  (Andrew Scott, p. 135, (pp. 152, 154-55).  By contrast Australia suffers 'the lowest level of unemployment benefits  in the OECD for a single person recently unemployed.'  Furthermore, ‘Work for the Dole’ programmes are punitive and provide little in the way of relevant skills for job placement. (Andrew Scott ; pp. 136-38).  Denmark’s active labour market programmes are expensive says Scott, but are worth the investment in radically higher workforce participation.   Achieving an economy which operates at ‘full bore’ – as the Swedes achieved for a significant time - also means more revenue for social programs.  Industry policies ensuring more high wage employment also enhanced those outcomes.





25) The Housing Affordability Crisis is driving an economic wedge between Housing Market Investors, Home Owners, and those struggling to (or unable to) purchase their own homes.   Simply releasing new land (the traditional Liberal ‘solution’) is not a viable answer unless services and infrastructure investment matches it.  Large public and social housing investments in growth and transport corridors could increase supply, however, and if introduced in phases may be able to ‘deflate’ the boom without a ‘crash’.   Labor’s negative gearing policies would also mean less competition between first  home buyers and housing portfolio investors.  Again , Combined with increased investment in public housing, and implemented properly, it should be possible to ‘deflate’ the bubble without a crash.   Public housing construction should  involve expansion of ( largely ‘non-clustered’) public housing stock to at least 10% of total  stock over several terms of Labor Government. ‘Non clustered’ stock aims to avoid traditional stigma against public housing, as well as the creation of poverty ghettos. Though there is the opposing argument that (implemented properly ; with the right infrastructure and services) clustered housing can create thriving communities.



26) There are those who argue capitalism cannot deal with looming environmental crises.  As a system based upon growth and the production of ever-more consumer goods, with a ‘growing environmental footprint’ , there are reasons to take these claims seriously.  That said: renewable technologies are advancing.  And information, culture and service industries – if emphasised – could involve much less of an ‘environmental footprint’.   A guided shift of emphasis to those industries could be key to environmental sustainability.  At the same time, though, we want to remain an economy which ‘makes things’.  Manufacturing will remain necessary ; and working conditions in manufacturing tend to assist the organisation of labour.  But we do not know yet just how far automation will go.  Automation could be good for people in their capacity as consumers, but bad for organised labour.



The Big Picture and ‘The Good Society’



27) Finally, Labor needs a vision of ‘the good society’  which includes redistribution and rights of labour – including labour market regulation (with an increased minimum wage) ; But at the same time goes further.  Marxism involved an implied moral critique of exploitation. But also of what was called ‘alienation’ ; That is, the impact of physically onerous, repetitive and/or mentally punishing labour.  And the lack of creative control workers enjoyed over their labours, and the products of their labours.  This ‘alienation’ could be addressed partly through increased free time for workers in such demanding areas.  And increased opportunities to explore such diverse areas as philosophy,  science, art, and leisure.  Though Marx also envisaged a time when fulfilling labour would ‘become life’s prime want’.   ‘Automation’ could actually create opportunities here IF implemented properly.



Also Labor should have an appreciation both of the importance of constitutional liberal democracy ; but also of its limits.  Democracy needs to be extended into production and work.  This could involve support for diverse models of co-operative enterprise and mutualism – on both large and small scales. Not only would this model by-pass exploitation: it could also provide workers with creative control over their labours ; including the kind of intimate control and identification that may go with co-operative small businesses.  (eg: co-operative cafes)   Furthermore, mutualist and co-operative associations could contribute to full employment in a situation  driven by contextual human need , and not only ‘share value maximisation’ – which is the modus operandi for capitalism-as-we-know-it.



Large scale co-operative and mutualist associations could also occupy crucial points in the economy in areas like health, motor insurance, and general insurance, and  credit/banking.  Government could play a central role of ‘facilitation’, here) Strategic ‘multi-stakeholder’ co-operatives could also be created through co-operation between Government, Regions, and workers.   That model might have been applied in the case of SPC-Ardmona ; and may even have been applied (much more ambitiously) to save Australia’s car industry.  Ambitious ‘mutli-stakeholder co-operatives’ should be considered by Governments, Workers and Regions for the future.

Other options for economic democracy include: growing the public sector , promoting ‘democratic collective capital formation’ (for example, like the Swedish ‘Meidner wage earner funds plan’) – though perhaps inclusive of all citizens and not only workers.  As well as ‘co-determination’ (worker reps on company boards).  Sovereign Wealth Funds or Pension Funds also socialise wealth and investment, and could be crucial to fund expenditure and investments (eg: infrastructure) into the future. 



Superannuation is entrenched now, and provided for peoples’ retirement without the political problems of raising taxes. It was seen as having democratic potential ; but it also had problems of reinforcing inequality in retirement (also affecting women) ; requiring low income workers to make contributions they could not afford ; and reinforcing the capitalist focus on share value maximisation regardless of other need.  Arguably pensions need to be more generous and broad-based ; but the superannuation system may lead to the marginalisation of the Aged Pension into the future.

In conclusion ; We should talk of capitalism and not only ‘neo-liberalism’. Because to name capitalism is to make it relative.  And one day the way may open for something better to become possible.  At the end of the day all wealth does derive from labour and Nature: and now just as in ‘the Heyday of radical Social Democracy’ this implies a moral critique of capitalism and class.




Dr Tristan Ewins has been a  Labor activist for over 20 years. He has written for many publications including 'The Canberra Times' ; but most prolifically for 'On Line Opinion' ;  see:  http://www.onlineopinion.com.au/author.asp?id=208


References

Scott, Andrew,
  'Northern Lights: The Positive Policy Example of Sweden, Finland, Denmark and Norway',   Monash University Publishing, Melbourne, 2014

Stanford, Jim
  "Economics for Everyone - A Short Guide to the Economics of Capitalism" , Pluto Press, London, 2008



Friday, March 3, 2017

POLICY DISCUSSION re: ‘Skills and Knowledge’ component of the ALP Platform’



Dear comrades ; what follows is a series of Ideas for reform of the Platform which I have developed.   This paper was originally developed for the Victorian Fabians Forum held on Feb 15th 6.00  2017 till 8.00pm at the Blue Room in the Multicultural Hub, 506 Elizabeth Street. Thereafter it was revised and extended.

I am sharing it with comrades here to provide an opportunity for feedback before submitting it for consideration.

If comrades have ideas how the paper can be improved please comment and let me know your opinions.

Sincerely,

Dr Tristan Ewins



Skills and Knowledge



The following are excerpts from the existing platform:


Preamble

Education is Labor's number one priority. It's the bedrock of social justice and cohesion in our society and it will build our 21st Century economy.

Labor will increase investment in Victoria's greatest strength - its people - so they may enhance their development and their participation in work and society.



The following ought to be added to clarify Labor’s values in this area (see above):

ADD: “Not only must education provide for the needs of the labour market ; it must also provide opportunities for personal growth ; and education for informed and active citizenship - which are also highly important. ”






The following excerpt is from the existing document:

Schools  (from the existing document)



     become active, well-balanced, knowledgeable citizens, able to participate fully in a democratic society

     understand our democratic multicultural society, recognizing what should be conserved, changed or improved



The following ought be added to clarify Labor’s position on the  purpose of our schools:


  • Develop political literacy ; an understanding of the social movements and political parties which contest the direction of economy and society ; and of both the interests, ideologies and values they represent ; and of the specific opportunities for active participation in a democracy

  • Develop these understandings in a complex manner ; including but not restricted to the ‘linear left-right spectrum’ ;  including ideologies of egalitarianism and meritocracy and the ways they variously complement and clash with each other, as well as libertarian and authoritarian dispositions ;

  • Develop understandings of society partly based upon but not limited to such differing notions as “conflict theory” and “functionalism”

  • Develop these capacities through content specifically prepared for that purpose in the Humanities, Social Sciences, Economics and English ; Develop a ‘political economy’ facet to Secondary Economics which considers the values, ideologies and interests behind economic theories.



Commentary:  these are important to promote the SPECIFIC knowledge necessary for effective political and social participation.   And also to understand things in their complexity: because the left/right spectrum is no longer – perhaps never was – sufficient to explain differing political and social movements and ideologies.  It is also necessary to present ideas in their complexity to maximise understanding ; empowering students to respond to the nuances in social and political debates, and to be effective, active citizens.  It is also important to address specifics when it comes to active citizenship, and not only deal with those issues ‘in the abstract’.






Emphasis on literacy, numeracy, creativity, and environmental sustainability.



In this part of the platform (see above) we should add the following:

“Provide alternative pathways  for students with specific talents and potential who may not respond to the specifics of the VCE curriculum ; ie: learning/memorising the curriculum is not necessarily the only, or the most important indicator of talent or potential.  Indeed, at the Tertiary level often significantly different means of learning and grading students’ efforts are involved.”


Commentary:  Learning to the curriculum does not necessarily represent all talent and potential ; so there must be alternative pathways ; and VCE and Year 12 should not ‘decide everything’



Letting our Teachers Teach and our Principals be Educational Leaders.

Comment:  In this part of the platform (see above) we ought incorporate the following in some form as well: 

“teachers with limited numeracy skills should not be penalised if they perform well in their fields ; eg: Humanities, English etc.”


And consider the following part of the Platform also:

Funding Schools to Meet Students' Needs   (from the existing document)



Labor will:

     Continue the student resource package (with base, per capita and disadvantage amounts)

     Continue to fund non-government schools in accordance with the financial assistance  model


In this part of the Platform we should also add the following: 

 
[Labor will] “Work to see that revenue shortfalls are addressed through progressive taxation mechanisms without depending on austerity elsewhere ; Labor recognizes that material and human resource shortfalls can only be fairly overcome through progressively structured taxation reform.  Gonski can only be fully and fairly  implemented through provision of the necessary resources without austerity elsewhere.



TAFE


We should add the following:  (nb: Lots of this has been reproduced from earlier in the document ; but it is as relevant here as it was before) :

Add the following:

TAFE must provide pathways for students in diverse fields, and that must include such areas as writing/journalism, liberal arts, music and so on.  The intrinsic value of these fields must be emphasised ; and should not be narrowly based on ‘maximising value in the labour market’;.  If viable Labor governments should ensure all these areas are geographically accessible to students across the state.

Labor will also endeavour to provide pathways and areas of focus emphasising political literacy and opportunities for active citizenship at the level of TAFE.  Again this should include:

·         Developing political literacy ; an understanding of the social movements and political parties which contest the direction of economy and society ; and of both the interests, ideologies and values they represent ; and of the specific opportunities for active participation in a democracy



·         Develop these understandings in a complex manner ; including but not restricted to the ‘linear left-right spectrum’ ;  including ideologies of egalitarianism and meritocracy and the ways they variously complement and clash with each other, as well as libertarian and authoritarian dispositions ;



·         Develop understandings of society partly based upon but not limited to such differing notions as “conflict theory” and “functionalism”



·         …. Explore ‘political economy’…considering the values, ideologies and interests behind economic theories.



Adult and Community Education

Comment:  Here we must apply the same provisions and priorities to Adult and Community Education as we have already discussed in the ‘TAFE’ section of this document. The same priorities and principles apply there as well.

Other issues relating to Skills and Education:

User Pays and Student Allowance in Higher Ed

User Pays in Higher Education has become more and more pronounced since the introduction of HECS with the Dawkins reforms of the 1980s.   The ALP has many priorities, and even if we do raise more tax revenue progressively (I would suggest by maybe 2 per cent of GDP upon taking Federal Government) –  even then we are limited. But we do have some room to move in rolling back user pays gradually, and making the mechanisms progressive and fair.  

I believe the following measures must be incorporated into the Platform:

·        Labor has a long term objective to restore ‘free education’, but is limited by other priorities, and the difficulties with raising the necessary revenue over the short term

·        Labor will increase the HECS repayment threshold so that it is significantly above Average Weekly Earnings

·        Labor will contain interest on HECS debts to no more than inflation for fairness ; and will make special provisions for those in a bad position to repay their debts (eg: upon acquiring a disability)

·        Labor will increase Austudy payments in real terms ; easing pressures for students to supplement their incomes with work ; because that can distract from study and increase the rate of students dropping out. That means an end result of wasted resources.

·        Labor will ease means tests for Austudy; again so students can study under conditions of financial security – and commit themselves fully to their study.  Hence Labor will also make Austudy more widely available ; providing it also for all tertiary students except those with very substantial means.

·        provide mechanisms for corporations to contribute more substantially to the skills development they ultimately benefit from.  This must provide room to move in making student contributions fairer and less onerous.



State Schooling ‘at the tipping point’

What is also important is the crisis in state schooling in this country ; especially secondary schooling.  Because of the proliferation of private schools ; of their superior human and material resources ; state schools are near a ‘tipping point’.  That is: the proportion of voters and families (especially in the middle income bands) with an interest in keeping state school viable – especially in years 11 and 12 – has been shrinking.  And this has lessened the electoral pressures – and the electoral benefits – in restoring and maintaining our state schools.  If these influences continue to develop we may permanently be left with a starkly ‘two tiered education system’ ; with a public system markedly inferior in human and material resources.  Then we can really forget about ‘educational equal opportunity’ for good.  Ross Gittins of 'The Age' (15/3/17)  has pointed out that the state school share of students has stabilised at 65% - but that it is down from 79 per cent from 1979.  And without Gonski - and further reforms - this 'stabilisation' may not last.  Gonski must be swiftly and fully implemented under a Labor government.  The resources must be found without austerity elsewhere. And perhaps Labor must go even further in reducing the gap between State and Private schools.  Also the prestige of the teaching profession – the respect accorded to it – must improve.  And this could also find realisation with better wages and conditions for teachers ; with lower workloads/smaller classes ; as well as better job security for those unsatisfied with casual and contract work.

All these concerns must be incorporated into the Platform.

The Humanities and Social Sciences must be Protected and Valued

The Humanities and Social Sciences have long been devalued compared with courses with have a more obvious vocational application.  In many universities they have been cut back.  They have come under attack from Conservatives who see no value in any enquiry which does not have an obvious and immediate vocational application.  With the emphasis on STEM and basic literacy and numeracy – their importance is widely disregarded.  But they are vital for a number of reasons.



·        They have the potential to be the vehicle for a radically democratic civics and citizenship focus – at both a Secondary and Tertiary level.  Harking back to earlier in this paper – the goal is to promote political literacy – comprehension of social movements and political parties ; as well as the values, interests and ideologies underpinning them.  As well as awareness of the avenues open for effective and active citizenship.  Communicated without Ideological prejudice ; the point being to inform – and not to ‘indoctrinate’.   (See earlier in this paper for further details)

·        Historical comprehension and appreciation of the origins of civilizations ; Deep appreciation of culture, ethics and aesthetics ; Engagement with the most profound philosophical enquiries and dilemmas – these and other facets of the Humanities and Social Sciences are enormously valuable in their own right.  Humanities and Social Sciences are also valuable for other reasons: comprehending social trends and phenomena ; understanding them qualitatively and quantitatively.

·        They have practical applications, also – learning how to reason and construct arguments ; broader communication skills ; research skills ; applying social theory and research methods to complex social problems.

·        Humanities and Social Sciences academics contribute significantly to the public sphere ; and hence to our democracy



These concerns should somehow be accommodated in the Platform.


This in mind Labor should commit to these concrete measures in its Platform:



·        Develop concrete ‘civics and citizenship’ and ‘political literacy’ content at a Secondary level ; especially in years 11 and 12. And provide incentives for students to undertake at least one Humanities and/or Social Sciences subject in each year of years 11 and 12.

·        Support Liberal Arts, Music, and Professional Writing Courses in TAFE and if viable in Adult Education (eg: CAE)  Promote these as potential pathways to Tertiary study.  Reform the Liberal Arts curriculum to better incorporate and include questions of ‘political literacy’ ; understanding the values, interests and ideologies underpinning social movements and political parties.  Incorporate an ‘Issues’ component in Professional Writing and Editing – to potentially prepare students for a career in journalism.

·        Perhaps develop courses in political literacy open to all citizens: not only as ‘pathways’ but also because of the intrinsic value of enabling citizens to cultivate their talents in all directions – including political literacy and active citizenship.

·        Set in place incentives (positive and negative incentives) to encourage Universities to support the Humanities and Social Sciences – as they are central to the viability of our Public Sphere ; and hence the viability of our democracy. Take action to stem and reverse the decline of the Humanities and Social Sciences in our Universities.

·        Encourage course structures which enable Tertiary students to undertake supplementary Humanities and Social Sciences content if they so choose ; perhaps at a heavily discounted rate ; with the aim of enabling deeper personal development ; and a civil society comprised of informed citizens.





Dr Tristan Ewins

ALP member of over 20 years ; February 2017

Saturday, February 25, 2017

Why and how the Fair Work Commission’s cuts to Sunday penalty rates can be Defeated.





In this article guest writer Don Sutherland argues the case for a strategy to reverse the decision of the Fair Work Commission - promoted by Employers - to slash Penalty Rates for Hospitality and other workers.  He foresees it will have to be a long struggle led by workers - and workers cannot just sit back and depend on the Parliamentary Labor Party.  It is a strategy which - amongst other things - will involve targeting specific employers so they do not take advantage of the FWC's decision and exploit their workers.

by Don Sutherland, 25/2/17


Last week Australia’s industrial “umpire”, the Fair Work Commission, legalized a big cut to penalty rates for Sunday work for Australia’s lowest paid and most vulnerable workers in precarious work. (Click here and click here for the official summary of the decision.) Implementing the cuts is not compulsory. Anyone who thinks neoliberalism is dying needs to take a deep breath and step into the real world.

Like many others across the union movement and beyond I am very angry on several counts with this decision. Above all it does great harm to the lives of thousands of workers (click here for example), even though it will increase the take home profit of their employers.

There is a lot of material being posted in both mainstream media and in many sources across social media about why this decision is bad, some of it before the decision was handed down and of course a lot since. This article does not add to that.

Rather I focus on ideas about how the workers and union movement can respond.

How should the workers’ movement respond?


In my view not just with anger, but with a widely, deeply discussed and developed strategy to win the reversal of the decision or to prevent its actual implementation.

I am against a “strategy” based on immediate anger that sets our movement up for an urgent, satisfying day out and another “glorious defeat”. And I am also against a defeatist walk into the arms of the ALP as the heroic solution.

Rationale for a strategy


This Full Bench decision of the Fair Work Commission (FWC) comes out of an Award review that is required by the Fair Work Act (FWA). The Award review is very much an industrial relations club exercise. The FWA review involves either union peak bodies or employer peak bodies putting to the FWC ways in which Awards should be changed, with the capacity for others, especially governments and political parties, to join in. The parties present their claims and counter claims, then provide evidence in an increasingly judicial process that involves “expert” research and / or witnesses. There is not much industrial organising that goes on in support of union claims or counter claims these days.

In this current review all Awards are under the microscope. The focus in these particular Awards for workers in hospitality, pharmacy, fast foods has been on their penalty rates, especially the penalty rate paid for working on Sunday.

Employers in the industry and beyond have over several years invested big money and resources to convince the FWC to agree to cut penalty rates for Sunday work. They have been supported by the Murdoch press, a big posse of commentators from right wing think tanks, and all major employer organisations. The union movement has been the major source of opposition. Originally, employers wanted cuts to all penalty rates but decided for a strategic reason to focus on Sundays. Do not doubt that their “victory” last week to get Sunday rates cut is a foundation for a renewed assault at some time in the future for further cuts into both Sunday and Saturday rates and public holiday rates.

While the employers were investing big in their own way to achieve their victory, the workers’ effort – mainly through their unions – was valiant and well-intentioned but puny in comparison. It was entirely defensive, and accepted the rules of the Commission and the Fair Work Act.

The employer strategy successfully used prominent Labor politicians, some of them willingly, and ex politicians (most notably perhaps Martin Ferguson, formerly a President of the Australian Council of Trade Unions).

The employer strategy relied very much on today’s working class  historic memory loss  about what an Award actually is. Nothing significant has been done by unions to counter this with worker education. Australian unions, generally, have opted to devote most resources to enterprise agreements as the vehicle to protect and improve wages and conditions.

Remember, the employers originated and escalated this war on living standards, not the Fair Work Commission.

This very bad outcome is a reflection of the current balance of power between Australia’s 21st century capitalist class relative to that of the working class.
That is the situation that our strategy must change.

A working class based approach to our strategy

Can we build a strategy, loaded with mindful militancy, that can reverse this decision and also the whole current momentum against working people? (Facilitated in the bosses’ favour by the Fair Work Act, e.g. lockouts, agreement cancellations, and the new Building Industry Code to be enforced by the construction industry’s own industrial police force against construction workers and their unions.)

Of course we can. Here are some ideas.

The first big strategic decision
for all union leaders no matter what level of the union movement we are active in: should we leave the reversing or whatever of the decision to heroic leaders, those at the “top” of the union movement and especially those in the ALP and the Greens in the parliament? Will calls to the government for the government to change the statute re-build our numbers and our power?

Or, should we return en masse to a conviction that the workers in these industries, and their brothers and sisters in others, can grow together as a socio-political force to reverse the decision themselves through their own industrial and political action?

The union movement at all levels must, absolutely MUST, embrace this second approach. Why? Because we must see workers of the twenty first century as capable of learning to struggle for their objectives not as objects whose conditions of existence are decided for them by elites, well-meaning or otherwise?)

That still means lots of education work and lots of communication that is educational (not cheap slogans or cute and clever memes,) leading to days of action on carefully selected dates. Days of action can be seen as the building blocks to more serious forms of action, including a national strike that can decide the struggle in favour of the workers.

Industrial strategy leading the way

The Commission is now waiting for submissions from the parties about the timing and process for phasing in the new reduced rates. Depending on each award, the critical dates seem to be in late March and early May.

After that the Commission will set dates for the start of the new reduced rates, probably later this year.

So, for example, this year these union / workers days of action might be 2-3 days before or on the day of the “submissions” hearing and then again 3 days before the start date.

Remember, employers can chose not to reduce rates. Embedded in these days of action there must be a workplace, public, social and political demand that each individual employer NOT implement the decision, but infused also with basic education and learning about “what is an Award”, “who are the employers”, “what is their strategy”, and “what is the Commission”. (Of course, many employers will try to “stay sweet” with their workers by telling them that it’s not their fault and they have no choice but to implement it.)

To the extent that it is necessary, a secondary level of campaigning in these 2 periods might help reinforce worker pressure on MP’s to come out at a local level to urge local employers not to implement the decision.

How long will it take to win – the trajectory for winning?

The second big strategic decision is a notional time frame that this campaign will take 2 to 5 years to win. It would be nice to win sooner but expectation that we can – in my view – misjudges the power of those who want this decision against the current power of those of us who oppose it.
We need time for education work and union growth organising to build the power to win. We do not have it right now, just the same as the employers did not have enough power to win their objective in 2007. The employers have understood strategy much better than us and have been ruthless enough against working people and their unions to stick to their strategy and be flexible in applying it.
We have to be every bit as cold and calculating as they have been and more.

Therefore, these days of action MUST be educational and  must be seen as building blocks to very big and powerful actions in the future that will be more decisive.

Our strategy will have to escalate over that 2-5 year period in the spread and depth of awareness among the workers immediately affected and those who will experience the flow on effects of it.
A strategy of this type must culminate with the consequence of economic pain for the employers who wanted this decision and who decide to implement it.

The next award review will be in 4 years or so, possibly less. That is the moment for the first “really big culmination” of our strategy in which employers can face the prospect of real economic consequences for their actions.

Within it there is the opportunity for the union movement to actively regrow from within the 21 st century working class, basing that on education-driven organising of both union members and potential members.

This decision to cut penalty rates is one element of ruling class momentum against all workers … the whole of the working class.

We can add to that the employers threat to re-locate operations to off shore low wage havens, use of lock outs during bargaining, demand for major concessions in enterprise agreements, and refusing to bargain for any improvements about job security or wages or safety, employer applications to cancel agreements and drive their workers back to the minimum wages and conditions in Awards, penal powers against any workers who take industrial action that is not approved by the FWC, and the government’s new Building Industry Code policed by the building industry commission. This is a considerable array of power for employers that is facilitated by the Fair Work Act.

Penalty Rates Plus

Genuine working class power can be built to demand at the next Award review and even before not just the restoration of current penalty rates but also a significant increase in the minimum Award rate, and automatic casual conversion after 3 months for those who want it.

These issues are relevant to all other Awards as well. We are talking about common, multi industry actions to take on common big employment problems.

This will be a campaign for all workers because the huge gap between award rates and union negotiated agreement rates is contrary to the fundamental rationale for unionism, and should not be acceptable to any unionist.

The focus of the whole movement must turn steadily (although not absolutely) to AWARDS and away from enterprise agreements.

Finally, this “ordinarily people” rooted strategy will require that the Fair Work Act (including its penal powers against workers) be defied, and probably broken, and ultimately genuinely re-written for workers’ benefit.

That’s not a reason not to do it but it is a reason for a lot of educational work in preparation.



This article was also published at Don's blog - which can be found here: 

https://donsutherland.wordpress.com/2017/02/25/why-and-how-the-fair-work-commissions-cuts-to-sunday-penalty-rates-can-be-defeated/