John Quiggin

'Continue reading "End of an era"'

It doesn't continue. Was it meant to?

Most of the statements made during this election (as in most elections) have been forgettable soundbites.

Ah, John, why so world-weary?

It shouldn't represent any such thing. At worst it may represent short-termism on the part of Howard.

The thing wrong with the Thatcherist dogma was the problem with "a little learning". It is indeed desirable to roll back the public sector. Only, it is not desirable to leave the need unmet. What is necessary - the meta-need - is to eliminate the need, engineer it out.

The public sentiment is the correct feeling that we have been dropped in it. The social-democrat prescription is inherently short-termist, aggravating the degree of dependency. The Thatcher treatment is based on letting the casualties fall where they may, promising jam tomorrow but overlooking the fact that tomorrow is kept indefinitely at bay by the continual supply of new casualties (P.T.Barnum had a profound insight into these mechanisms).

So what's a poor short termist politician to do? And what else could John Howard be, given his need to climb the same greasy pole as all the others?

What is needed is something that works our way out of the need. The fact that we only have politicians, that we are institutionally prevented from having statesmen, is an underlying meta-problem that presents the appearance that people have turned in favour of social democracy. In fact our system denies us the chance to do anything constructive, so you can't read anything deep into the tactics and/or reactions of politicians.

That's all there is, James. The continuation was a bug, fixed now

John,
you write:

"I think it's reasonable to treat this statement as representing the end of the neoliberal push to overturn the social-democratic settlement."

A bit optimistic. You have fogotten the states. We do have neoliberal ALP states eg. SA.

If only "the end of the neoliberal push to overturn the social-democratic settlement" would happen here in the states. Instead, we're full steam ahead for the 1890's.

But then you have Mark Latham promising to reduce the Federal revenue and outlays shares of GDP and talking about 'limited government.' The preoccupation of federal and state governments with debt reduction also suggests that they think fiscal conservatism is electorally popular.

Or am I beeing a little too paranoid here?

"the end of the neoliberal push to overturn the social-democratic settlement"? Maybe... or maybe not.

I don't think we're going back to the kind of Australia we used to have. Tariffs aren't about to start breeding like rabbits. The CES won't return, the Commonwealth Bank isn't going to be re-nationalized, and we're not going to see the return of the two airline policy.

The public service isn't going to expand as a proportion of the workforce and contracting out isn't going to stop.

More and more of what we use will come from the market sector and less will come from government agencies (governments aren't about to discourage private schools, private hospitals, or superannuation).

But, as government employs fewer and fewer people and does less and less it will grow. The growth in income support, the PBS and other shifting-money-around programs will force governments to be more and more ruthless about the cost of direct service provision.

That's an interesting soundbite alright, thanks John, but I wouldn't draw from it any conclusion of impending revolution in Coalition or even Labor economic policy.

I agree with the comment above that the best explanation for the behaviour of American wingnuts presently running up the US deficit as wildly as they are includes an intention to at some stage, soon, point and shout "Yowza! look at de siza dis here deficit man! This spending has gotta stop - on wasteful things like health, education and welfare - so that we can maintain the all important expenditure on essential things - such as spreading American values of personal freedom - by maintaining our state of perpetual war. Which sure costs money!"

I'm not paranoid or nuthin.

Keynesian social-democtatic consensus.

Perhaps for the Barstard keynesians as the late Joan robnson called them but not for others.

Nor even for the Great man himself.

At last! A Left blogger finally adds another dimension to Howard. It must be exhilirating to crawl out of Flatland and see that Howard has at least two-dimensions.

I have been saying that Howard is an pragmatic "vital centrist" for ages. On June 11, 2003 Jack Strocchi Posted this blog at Catallaxy "LITTLE JOHHNY" HOWARD: MACHIAVELLIAN ASIAN-LOVING SOCIALIST which detailed chapter and verse Howard's socialistic tendencies (GST, Gun Control, pork-barelling to Geezers, Breeders & Battlers).

I dont buy Howard as an Whitlam-style Social Democrat. You wont find him into the full Progressive nine yards of unconditional welfare, and bashing private schools or private health.

Howard's statement is more akin to Menzies style Nation Building. Howard supports Conservative statism eg the Alice to Darwin rail line, subisidies to mothers etc

All this is par for the course for the nineties/naughties Howard. He proclaims Centrist ideological objectives, uses right-Machiavellian political styles and delivers left-Kantian policy substance.

The free-market, nativist-racist Howard was a seventie-eighties production - more a reaction to rat-bag Leftism of the Cairns-Grassby variety. But he has grown and moved on since then.

On national security: Far from being a UN-bashing chauvinist, Howard is a liberal internationalist. He led a most successful UN peace keeping mission, strengthened regional stability with nation building and promoted democracy in three nations.

On civic identity: Far from being a Hansonite-nativist, Howard is a cosmopolitan integrationist. He destroyed Hansonism, increased NESB immigration, bolstered indigenous funding and proclaimed the value of multiracialism.

But rather than deal with all this complexity the Left blogosphere prefers the joys of Howard-straw man demolition derbies.

The real ideological revelation of this campaign will occur when the rest of the blogosphere wakes up to the reality of Howards vital centrism. I am holding my breath.

1 . The idea of Public-Private Partnerships is the latest attempt at such a soft option. But

John: the sentence just up and died here. Were you going to say any more?

JQ,

I think Jack Strocchi has a point on this issue: Howard's free-market credentials are very weak, and he has shown a marked tendency throughout his career towards activist (big) government.

Where I disagree with Jack is that I don't credit Howard with enough intellectual sophistication to have a clear ideological preference when it comes to the role of the government in the economy. Furthermore, I'll eat my shorts if Howard has ever stated the aim of delivering "left-Kantian policy substance". He'd probably think "left-Kantian" was a naughty sexual position that Janette wouldn't let him try.

Howard has freely used taxpayers' money to porkbarrel himself more votes. He is a big-government conservative, not a liberal. As such, I suggest he's barely a Thatcherite at all when it comes to the government/economy nexus.

Keynes would be aghast at the spending howard has proceeded on.

howard like most PMs is a pragmatist who wants to win which is why he is spending money like Whitlam.

Robert Merkel,

The point is that public opinion on this issue has shifted. Republicans say they want to cut the size of government but they even they no longer acutally do it. Republicans have been in complete control of Washington for 3 years now and have actually increased the size of the government, not reduced it.

The budget/deficit/crisis model which Frankis mentions for smashing government spending is a nice idea but there's no guarantee it will work. When that deficit problem comes to a head, both the size of government will have to be cut AND taxes raised. Which one of those two approaches gets the most emphasis will decide if the neo-liberal ideals of small government have come to be accepted by the American public. But I have a feeling that Republicans dreams of smashing big government will be sorely disappointed by an American public that chooses to raise taxes rather than cut services.

The highlight of the last Victorian State election was Guy Rundle's description in the Age of Steve Bracks as an 'extruded plastic action man' and the opposition leader Robert Doyle as looking like a 'testicle on legs' (the quotes may not be exact).

I'm still waiting for the same sophisticated analysis and critique in this current campaign. Jack's 'Machiavellian Asian-loving socialist' for John Howard is prety good, although I think stretching it more than a little.

We have been in a social democracy for a while now. As John correctly notes, even Thatcher and Raegan didn't achieve a reduction in the size of government. I haven't heard Howard promoting anything like real liberal reform, and I doubt he even wants to.

For real neo-liberals it is a baseless and offensive slur to call Howard a neo-liberal. And to call the ALP in the states "neo-liberal" is to show how low political education has fallen in this country.

1900-1975 saw liberal democracy turn into social democracy. The "fightback" from the "neo-liberals" resulted in a stall in the growth of government and a growing concensus among mainstream elites that the government shouldn't be too much bigger or smaller.

That is not quite true. George Bush is "a political leader in the world whose views were formed by the Thatcher era". He has not formally renounced the Reagan-Thatcher ideology, nor embraced social democracy (just Reaganism with a human face ie "compassionate conservatism").

And most Republicans are still, in practice, committed to free market tax-slashing and, in theory, to government gutting policies .

All parties engage in pork-barrell statism for demographic-psephological, not ideological, reasons.

The Republican heart land is the sectarian Red States which contain poorer rural battlers, geezers and military basers. The Reps. must subsidise these religious folk with warfare pandering to win office.

The Democrat heartland is the secular Blue States where ethnic special interests are concentrated. The Dems. must subsisdise these racial folk with welfare pandering to win office.

So whatever happens, demography ensures that the on-rush of the Leviathan juggernaut will not be blocked.

'George Bush is "a political leader in the world whose views were formed by the Thatcher era".'

Not to get into partisan slurs here, but when Thatcher was pushed out in the early 90s, GWB was still relying on Daddy's connections to rescue him from his various failed business ventures. And in Thatcher's glory days in the 70s and 80s he was still a cocaine-sniffing wastrel. Any formation of political views was far from obvious.

Bush is a straightforward class warrior, with no interest in the free market or liberalism of any kind.

there's points here for discussion, fwiw...
>>>>>>

7 August 2004
Election 2004: House to house fighting through the institutions

David Burchell, University of Western Sydney

If the Coalition should perchance lose office on October 9, most people on the Left will be breaking out the champers and bar nuts to celebrate the fall of what they’ll probably describe as the most ideologically driven of Australian conservative governments. Particularly bitter words will be uttered over the Tampa episode, the asylum-seekers crisis, and the war in Iraq. And there will be heady talk about an end to union-busting, scapegoating, wedge politics and the ‘politics of fear’.

In this I think the Left will be pretty much on the wrong track—as indeed, in my view, it has often been on the wrong track over the last two or three years. Despite the received view to the contrary, the hard-line conservative ideological credentials of the most recent Howard government are fairly muted. Indeed, the prevailing political wind savours less of the antiseptic odour of ideological purity than of the visceral scent of the political fox hunt. With the benefit of hindsight, the really striking feature of the later Howard years may seem to be the government’s—or perhaps actually the PM’s—willingness to trade anything, more or less, for short-term tactical political gain. In many respects, this has been not the most ideological but the most ruthlessly pragmatic government in living memory. But the Left is right in this much. The government has been ruthlessly pragmatic—but not in a good way.
The government’s failure of ideology is less matter of intention than of execution.

The government’s failure of ideology is less matter of intention than of execution. Just about everyone in the conservative parties these days, from the PM down, seems to share a deeply-rooted instinct that Australia has drifted over time into a kind of gooey progressivist morass from which it needs to be rescued. Indeed, if there’s a single unifying feature of conservative administrations around the globe, it’s this pervasive sense of a need to roll the clock back somehow, to restore eroded social values of patriotism and respect, arrest the decline of the family as an institution, and bring back lost culture of personal initiative and responsibility. It’s a political culture of social restoration.

And yet, twenty years after the ‘New Right’, how to achieve these goals is still a matter for genuine confusion in conservative circles. There are numerous voices booming again from the hard Right of the political landscape for a massive rolling-back of the state, an end to welfare ‘as we know it’, a decisive counter-attack against the supposedly liberal bias of the media and information industries, and so on. And there’s an urgent sense of the need to ‘roll back’ the relativistic, easygoing moral values of the Sixties and Seventies, somehow.

And so the federal government has devoted an inordinate amount of attention to the venial ideological sins of the ABC—almost convincing itself, apparently, that if particular institutional bastions of the liberal intelligentsia could be overcome, somehow the whole social landscape would change. People would start believing again in the God-given sanctity of marriage; patriotism would once again become a unifying force; moral certainty would reign again in the land. The same flailing, inchoate instinct also underlies of the PM’s bizarre personal campaign against the state schooling sector—which he seems to see as staffed by an army of ABC-lookalikes, mischievously dispensing nuggets of postmodern relativism disguised as history lessons. And it presumably has something to do also with the government’s spiteful campaign against the larger half of the university sector.

In practice, however, modern conservatives evidently have few new ideas about how to ‘roll back’ social values or restore personal qualities of responsibility and initiative, other than giving a market-based or faith-directed tincture to programs which are explicitly un-conservative in their basic character. And while no-one on the Left is going to welcome the government’s reforms to unemployment or welfare policies as progressive innovations, in practice these reforms have been less disruptive and less objectionable than just about anybody anticipated. You could almost go so far as to say that in social policy the government—like some Victorian missionary roaming the dark streets of London in search of souls to save—has been mugged by reality.

The three great social policy legacies of the latter Howard years, in retrospect, will be the Work for the Dole scheme, the Job Network and the recent reforms to family law and divorce. There is no indication that Labor, if elected, would abolish or greatly overhaul any of them—nor is it obvious that it would need to.
Modern conservatives have few new ideas about how to ‘roll back’ social values.

John and Anne Nevile (2003) have shown pretty persuasively that whatever its intentions or ideological justifications, Work for the Dole has had broadly positive effects on the employability of many young people, and may well also have had important positive effects on their morale and personal self-esteem. (The persistent refusal of many Left economists to acknowledge that the ‘subjective’ dimension of the unemployment experience matters from the point of view of employment policy—usually purely by reference to theoretical assertions about employment economics—may well be judged poorly by history.)

The Job Network has had deep structural flaws, as well as teething problems. The dismantling of the old public-service-based job placement system has drained a mass of institutional know-how out of the system, the long-term unemployed (being uneconomical customers) are being relatively neglected, and it seems clear that charitable agencies are often ill-equipped to behave as business tendering for competitive contracts. Yet despite these problems, and within the limits of its woefully inadequate funding base the Job Network’s outcomes are not self-evidently worse than the systems that preceded it. It can be made workable.

Finally, despite the vociferous attempts of the PM to present the government as an enemy of the Family Court and a friend to angry non-custodial dads, the recent reforms to family law and divorce are on the whole sensible, unextreme, and timely. Further, it’s worth noting that they were devised by a bi-partisan parliamentary committee that included representatives both from the right-wing of the government’s ranks, and the left-wing of the opposition’s. All of which suggests that the pervasive air of ideological warfare in social policy is a tad overstated.

Social policy innovation is only one part of a much broader story, of course. The early Howard budgets needlessly and maliciously stripped money from many social institutions and community organisations that desperately needed it—and most of that money has never been restored. The overall social policy budget has actually shrunk, for the first time since 1945. The extreme ambitions of the first Howard government in industrial law and workers’ rights were thwarted only by the Senate, rather than any sudden access of reasonableness. The re-casting of employment policy was done on the cheap, and this cheapness has never properly been remedied. The PM’s very own family income policies—now partly reversed—have constituted the single greatest experiment in conservative ‘social engineering’ of the past seven years, to the great detriment of part-time working mums everywhere as Patricia Apps’ contribution to this election symposium shows. And the conditions in our immigration detention centres are still an international scandal.

In hindsight, though, when its time finally closes (this year or in three years’ time) the Howard government will be remembered not for consistent ideological extremism (which has become more muted over time), but rather for its extreme political pragmatism. And, as I said earlier, pragmatism of the cynical rather than the constructive kind. After all, the kind of pragmatism that comes from the urgent need to make some portion of one’s higher ideals real, even at the cost of purity of principle, is often no bad thing, on either side of politics. The type of pragmatism that really deserves the term’s inglorious reputation, however, is the type born of soured hopes and militant defensiveness. It’s not ideology abridged by practice so much as ideology warped by bitter experience. It’s the type the PM has made his very own.
The Prime Minister is no intellectual—
indeed, he prides himself on this fact.

The Prime Minister is no intellectual—indeed, he prides himself on this fact. But he is an astute and observant man. He is well aware of the weaknesses, not just of his parliamentary opponents, but even more so of his social and cultural foes—those garrulous if unworldly tertiary-educated professionals around whose enthusiasms and loathings much of the government’s divide-and-rule political strategy revolves. In particular, he seems to have an uncanny knack for divining the issues which urban professionals employed in the public and community sectors will see as no pasaran ‘litmus-tests’—and which can in consequence can be used as distractions from the ‘main game’, or as tools for dividing patriotic suburbia from the oppositional inner-city. Nobody much in Australia has shown an interest in legislating for gay marriage. (Not least because gay couples in this country already have access to a fair degree of equality of benefit without it). But threaten to ban it anyway, just for show, and watch those banners being unfurled and the barricades thrown up.

And then there’s the PM’s darker side. Just as Steve Waugh spent his illustrious career in cricket captaincy constantly reminding himself of the cricketing humiliations of his youth, the PM today is still the same man who spent the greater part of his political life stewing on the opposition benches, with much of that time spent toiling under the weight of scheming rivals and incompetent superiors. This bitter experience has left him with an ingrained defensiveness and reactiveness that seems all-encompassing, and which apparently drives him to view just about every arena of policy as a progressive attack-zone to be countered, or as an opportunity to divide, deceive, or generally confound his opponents. When his time for the Pearly Gates finally comes, it’s difficult to believe that his life-motto could be anything other than ‘I didn’t let the bastards get me’.

Almost all the political attention of progressives nowadays is occupied with the great moral issues of the moment—the asylum-seekers debate and the war in Iraq. So the story goes, these are the crucial, the Spanish Civil War-like, barricades of the day. (It was no surprise to see a recent volume, 1930s-style, titled Authors Take Sides on Iraq. Or to see the low level of debate it proffered.) Yet a great deal of what the Left likes to think of (rather histrionically) as the government’s non-stop campaign of ‘lies and deceit’ on these issues amounts to little more than the combination of these two simple facts. When he feels under threat the PM will do just about anything to blunt what he sees as the attack, or to distract or divert those whom he believes to be his attackers. And to delay or forestall further assaults, he will always try to set his opponents arguing among themselves—not just by rhetorical campaigns, but by policy too, if necessary.

All of this would be unexceptional enough if it related merely to the cut and thrust of political debate. After all, as a radio commentator recently noted, one person’s wedge is another person’s coalition, and dividing one’s enemies is in principle no more morally reprehensible than uniting one’s friends. And nobody ever invented Queensberry’s rules for electoral combat.

The problem for Australian political culture is that the strategy never really does stop there. And so for the last three years in particular—after the PM’s narrow scrape in 2001, and the lessons in ‘wedging’ he learned from it—a very broad sweep of Australian public policy has become a weapon in a series of short-term political campaigns in pre-emptive striking or division-and-rule.
Previously dusty and inconspicuous public institutions have become public political battlegrounds.

The PM’s parliamentary opponents can’t claim to be complete political virgins in this respect, of course. Long before the present government targeted Mark Latham for a personal mud-slinging campaign of unprecedented savagery, the Labor governments of the 1980s and early 90s employed supposedly impartial public servants to gather together the past misstatements of Labor’s opponents (although not, it should be noted, the details of their extra-marital affairs). And it was after all Labor who first perfected the art of using expert (but in practice partisan) Treasury advice as a means of defending its own rubbery budget costings while attacking those of the bureaucrat-starved opposition.

Yet if Labor dug a dubious track, the Coalition has bitumened it into a super-highway. As study after study by the government’s academic opponents has lovingly detailed, ever since the Tampa fiasco we now have a system of bureaucratic advice in Australia that depends upon the ability of ministers to deny that they were ever advised on anything or everything within their portfolio area, whenever convenient. To all intents and purposes, department bureaucrats required to be in close contact with their ministers have now become publicly-funded party functionaries—whether they like it or not. (Most often, hardly surprisingly, they don’t.)

Not only that: the business cycle itself—once viewed by conservatives as a geometrical mystery akin to the movement of the planets—now requires to be tamed and harnessed to the needs of the political cycle, such that interest rate movements themselves have become political counters, regardless of the wishes of the Reserve Bank. (At least one could never accuse Paul Keating of using interest rate fluctuations for short-term political gain!) The government ritually loads the budget coffers with booty after each election, and then scrapes them bare before the next, distributing the proceeds holus-bolus towards any constituency that looks querulous or troublesome. It’s a strange kind of electoral Keynesianism, a combination of pump-priming and the old-fashioned election-day banquet.

Previously dusty and inconspicuous public institutions have become public political battlegrounds. The ABC board is now a war zone in need of UN intervention; the National Museum directorship is the dictionary-definition ‘poisoned chalice’; even state high school principals now seem to spend as much time defending their school’s ‘core values’ as they do managing their (increasingly) scarce resources. Instead of the ‘long march through the institutions’ the Coalition has pioneered a new tactic: house-to-house fighting through the institutions. At the end of the day, though, the military outcome often seems to be that the institutions are left charred and smouldering.

This intense politicisation of Australian public life will surely come at a heavy cost. The so-called ‘Westminster’ vision of the state apparatus as a neutral and benevolent institution suspended above the arena of political battle looks like a fusty anachronism in an era increasingly dominated by political paranoia and hyperventilation. Yet for social democrats some practical, rough-hewn version of a dispassionate bureaucracy has always been an indispensable companion of good progressive governance. You need to be able to trust your advisers and public officials if you’re going to shape controversial social changes. And you need some broad public reservoir of moderate goodwill beyond the wire-fences of the political polemicists and partisans. It’s dangerous to have to rely on the raw faith of the loyalists alone.
We live in a time of political nostalgia and ostentatious disillusion, Right and Left.

It’s a curious fact of our political life that while most intellectuals nowadays seem incapable of detecting more than a microscopic difference between the political parties, our political debate has rarely been more polarised or strident. There seems, in short, a gulf between our perceptions of the battle-lines and the objectives of battle, on the one hand, and the manner in which the battle is carried out, on the other. In part this may be a result of the ascendancy of moral issues in our political argument, since victories over one’s moral enemies are required to be absolute and Biblical in their scope, and morality demands vengeance and revenge.

In part, too, it may be because the political needs of the moment and what could be called (in inner-city-speak) the political ‘headspace’ of the protagonists have rarely been more out of kilter. We live in a time of political nostalgia and ostentatious disillusion, Right and Left. As I noted earlier, a good part of the Right is still in mourning for social and cultural verities (what George W. Bush would call ‘moral clarity’) that haven’t really been in evidence since the 1960s. By the same token, a fair proportion of leftist intellectuals, in their heads, are still living somewhere back in the 1970s, and their bitterness still smacks of the burnt aftertaste of scorched dreams. At the same time, in progressive circles more broadly there’s an overwhelming weariness of the political imagination—as if all the ‘good’ issues have already been won and lost, and nothing remains except the humdrum administration of an inglorious affluence.

Just about as many Australians as previously are living chaotic, dysfunctional lives on the margins of affluence, or are struggling to ‘get things together’. Meanwhile our social policy ideas remain stubbornly anchored in the ideological certainties of another era. This government has done an excellent job of raising the temperature of political battle, so that just about everyone feels the need to take sides, one way or another, on the great moral issues of the day. Yet when the political fusillades have died down, the distant echo of the ricochets may sound eerily like whistling in the dark.
REFERENCES

Nevile, A. & Nevile, J. 2003, Work for the Dole: Obligation or Opportunity?, Centre for Applied Economic Research, UNSW.

David Burchell teaches in Humanities at the University of Western Sydney. He is chair of the editorial board of Australian Universities Review.

Mat, its better to link to a long screed rather than post it in someone's Comments section.

the US under Bush...has managed to follow the tax-cutting part of neoliberalism, but not the expenditue-cutting part. I honestly don't know how this will play out when the bills finally come due. But it's fair to say that, in rhetorical terms at least, Bush's "compassionate conservatism" represents a repudiation of neoliberalism.

It would be irrational in the extreme to take any ideological statement made by Bush et al at face value.

During the 2000 campaign he claimed to be against nation building, then turned around and tried to nation build the whole ME.

He claims to be for "compassionate conservatism" but has slashed funds to state and local governments.

More importantly, Bush is after a mandate to break down the Roosevelt New Deal entitlement programs. Hence the "Ownership Society" policy. This amounts to a glossed-up form of stealth privatisation of health, education and social insurance programs, turning them from tax-funded government entitlements to self-funded corporate service provisions. This is far-reaching neo-liberalism in everything but name.

They may not be able to sell it to the US public, but Wall Street sure likes the sound of it.

I think the neo-liberal era was a blip on the horizon. In 1910 - when the Asquith government faced two elections forced by the House of Lords on Lloyd George's "soak the rich" budget, the of GDP spent on social policy (broadly defined) was 4.6. Fast forward to the last year of the Callaghan government and it was around 40%. It hasn't budged much since, Thatcher, Major, or Blair. There has been a secular tendency for state expenditure to increase over the 20th century, but far more important than the % of GDP is whether or not this spending makes an appreciable difference to the redistribution of wealth. It makes less difference than it used to, and the Latham "welfare to work" agenda suggests that a Labor government in Australia will again ignore any real progressive change in favour of pandering to the middle class' unending desire for lower taxes. In that sense, the neo-liberal agenda continues. It was never about small government - rhetoric aside - but about reversing the trend to greater social equality. In that goal, it has succeeded, and it would seem, will continue to succeed - Howard or Latham.

Actually, Republican ideological pipers are already whistling to Bush's more statist tune.

David Brooks scented the change in the ideological wind with his "The Era of Small Governmemt is Over: How to Re-Invent the GOP"

The ever reliable Fred Barnes, always ready to hop onto the next ideological bandwagon, promotes A 'Big Government Conservatism'

Atleast the Cato Institute continues the good fight against pork-barell socialism The Era of Big Government, something that rational socialists should support.

Demography is destiny, so Republicans will have to find some ideological formula to rationalise their statist pandering.

But they would dearly love to use their K-street lobbying power to broker Wall Street's franchising of the Welfare State.

I take it as given that the demand for public goods and community services, for aging and affluent societies, is bound to grow. That is to say, government is the major effective provider of "superior goods". A superior good is a good whose industrial demand grows faster than the rate of growth in income.

Gittins points out that most Australians treat health services as a superior good:

According to figures issued last week by the Australian Institute of Health and Welfare, our total spending on health care grew in real terms by almost 5.5 per cent a year over the five years to 2001-02.

That means we're now spending $67 billion a year on health care, which is a cool $3400 per person. It also means our spending on health has been growing much faster than our spending on everything else, so that it's now equivalent to a record 9.3 per cent of the nation's income (GDP).

If that proposition startles you, remember that our rapid growth in health-care spending is being matched in virtually every other developed country. Our outlay of 9.3 per cent of GDP is in the middle of the pack, between the two extremes of Britain (7.6 per cent) and the United States (13.9 per cent).

Given that we are all social democrats now, it follows that the debate between ideological camps will now be about the equitability, efficiency and accountability of the provision of these goods and services. Gittins cites a fave of Pr Q, the vertical imbalance of financing and spending responsibities b/w Fed & State agencies, plus my fave, interest group capture of govt depts:

for reasons of fairness, we do (and always will) heavily subsidise access to health care, there's a high chance that a fair bit of existing health-care spending is wasteful - and a fair chance that increased spending does more to fatten doctors' incomes than improve our health. That's what Abbott should be getting on with: reforming the funding of health care in ways that reduce waste and increase the public's value for money.

A key part of this would involve rationalising the present division of responsibility between federal and state governments, which fosters stupid cost-shifting games and leaves no one accepting ultimate responsibility for patients' well-being.

Resolving the federal-state bifurcation is a prerequisite to the move that would do most to improve health while controlling the growth of costs: increasing the emphasis on preventive medicine.

I have a question for Pr Q: what system of political economy can deliver the economical and ethical benefits of government goods & services provision without the costs of political statism?:

• hordes of bludging overstaffed bureaucracies;
• dead-hand of bureaucracy stifles enterprise;
• immortal government agencies which grow forever;
• Parkinsons Law;
• unaccountabile QUANGOS;
• pork-barelling politicians;
• organisational capture of bureaus by unions
• election year bribes to marginal electorates;
• special interest capture of parties;
• tax-creep constraining factor supply.

I had always thought that the "Reinventing Government" movement was on the right track, with corporatisation, out-sourcing, down-sizing etc.

One hopes that English political economists did not live in vain.

I'm hearing echoes of Churchill in my head. It's possibly the beginning of the end, but more likely the end of the beginning, of the small government enthusiasm. How this will play out is difficult to predict. I expect that there will be quite a long period where an intellectually respectable case for government funding for big infrastructure by borrowing will be worked up. Simultaneously the case for a version of counter-cyclical neo-Keynesianism will gradually return to fashion. It will take "crazy brave" political figures like Latham to dip their toe in the water, and begin something. (I'm referring to his strategic approach and style, not his policy preferences which imho are fundamentally conservative and absolutely consistent with the small government/deficit fetishism which has become so popular during the past quarter century.)
The Keynesian orthodoxy as the guiding light of public policy prevailed for about 25 years. Was it Samuelson who pronounced ca. 1968 "We are all Keynesians now?" After a period of confused response to stagflation, we've had close to a quarter century of anti-Keynesianism.

Peter F, Not sure if Samuelson said "We are all Keynesians now" in 68 (though he may well have), but Richard Nixon famously made the same remark in 1970.

We may have had anti-Keynesianism at the theoretical level, but Republican governments in the US (Reagan, Bush II) certainly refined military-Keynesianism to a fine art.

It was Friedman, actually (and later Nixon). But he was referring to the general theoretical apparatus of macroeconomics, not to Keynes's macroeconomic policy recommendations, let alone his views on the economic role of the state in general.

I entirely agree on the linking ideal re Mat's long quote. For the sake of clarity in the comments, I believe his contribution should be edited to show a link to:
http://www.econ.usyd.edu.au/drawingboard/digest/0409/burchell.html (and perhaps reasons for the substitution)
I know, I've veered off topic myself, but the above suggestion alone would enhance this thread (in terms of readability) more than I've detracted from it.
(FTR note the different spellings of Mat[t]. If the substitution does occur, I don't want my post used as consent, because we're not the same person)

Great article, Mat, thanks for posting it. Here is a link to it's original home.

ahem... didn't notice the previous post.

Not to get into partisan slurs here, but partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur, partisan slur.

If I'd known you were reading, George, I'd have turned the irony alerts on for you.

Jack Strocch (Stropp?) - the point you make about John (and probably more so, Jeanette) Howard's political philosophy could be summed up as "Whatever it takes".

Clive James rejoices that the book of his enemy has been remaindered. But for political foes it is even better when you find their political biography on the shelves at Vinnies and can acquire same for nix as you brought a bag of old clothing in. Even better when you discover that the faithful departed whose relos brought the book into Vinnies had never actually read the Barnett/Goward turgid panygeric.

But if you read it as I have you will discover that it would have been better titled "The Hollow Man".

I guess it all depends on what we mean when we refer to the Social Democratic beast.If it is reappearing at the end of history then what sort of rough beast is it now?

John says that it is not a return to the tradtitional social democracy of the post war (WW2)settlement. He then writes:

"So government at the moment is largely a matter of stretching limited resources to respond to steadily growing demands. It's not very inspiring or ideological, but that's not necessarily a bad thing - we have enough of 'interesting times' on the foreign policy front."
Does that imply different means/techniques/instruments for the same ends?

I would argue that social democracy (eg. Latham's ALP) has been transformed through its accommodation with neo-liberalism. Its end core values (equality, community) have been reinvented. Some, including me,would say these the ethical core of social liberalism has been hollowed out.

What fucking neo-liberalism? Damn it you people. High tax is not neo-liberal. Increased regulation is not neo-liberal. What both Howard and Latham promote is about the same as the dreams of the 19th century fabian socialists.

John,

You write:
"What fucking neo-liberalism? Damn it you people etc."

Ease up. I'm not suggesting that high tax and increased regulation is neo-liberal. It is not.

But the turn to competitive markets, opening up a closed national market to the world economy, deregulation, increased market freedoms, supply side economics and governing through the market not the state is a turn to neo-liberalism.

I would prefer to talk about a mode of governance at this point to capture the hodge podge nature of the way the population is governed.

Hence my idea of social democracy's accommodation to neo-liberalism. I would emphasize accommodation because that does not say that a Latham-ALP is neo-liberal--it is not. Neither is Howard. He represents conservative big government wrapped around market liberalism.

It is a third way between traditional social democracy and classic liberalism.

I have lost count of the number of times that the death of neo-liberalism has been pronounced prematurely. Surely it should be obvious that
Howard being prepared to say and do anything in in order to hold onto power. I dread the thought
that this deceitful warmonger will win yet another term in office.