What’s so strange about Wayne Swan’s essay ”The 0.01%” in this issue of The Monthly is that it appears to be a loser’s script. As in: the Australian Treasurer representing 99.99 per cent of the electorate fails to prevail against ”the rising power of vested interests”. In his essay, Swan cites just three billionaires who ”misrepresent their self-interest as the national interest”. Namely, in order of citation, Andrew Forrest, Gina Rinehart and Clive Palmer.
However, the evidence indicates that if there is a battle between the 99.99 per cent and the 0.01 per cent, then Swan’s team has prevailed. The likes of Forrest, Rinehart and Palmer opposed a carbon tax leading to an emissions trading scheme. But this legislation has already passed through the Parliament and will come into operation on July 1.
Then there is the minerals resource rent tax. This was strongly opposed by Forrest, Palmer, Rinehart and more besides. But it has passed the House of Representatives and will pass the Senate, provided Bob Brown and the Greens support the Gillard government. Certainly, Swan revamped his proposed resource super profits tax in 2010 after it was opposed by the mining giants BHP Billiton, Rio and Xstrata along with large sections of the community. However, this had little to do with the companies headed by Forrest, Rinehart and Palmer. They were not consulted.
In other words, those The Monthly has described as ”billionaire activists” have not succeeded in preventing the Prime Minister, Julia Gillard, and her Treasurer from implementing what they regard as the national interest.
If there is – as Swan alleges – a bulwark to the ”fair go” in contemporary Australia, then it does not come from Forrest and friends. In the battle of ideas so far, Forrest is with the losers and Swan is the captain-coach of the winners.
It seems that Labor prime ministers and deputy prime ministers have developed a habit of spending part of the summer break writing critiques of entrepreneurial business for publication in The Monthly, which is published by multimillionaire property developer Morry Schwartz.
In February 2009, The Monthly published Kevin Rudd’s essay ”The Global Financial Crisis”, in which the then-prime minister bagged what he termed ”neo-liberalism”.
The problem was that his targets included not only such conservatives as Margaret Thatcher, Ronald Reagan and John Howard but also such social democrats as Bob Hawke, Paul Keating, Bill Clinton and Tony Blair. Now Swan has devoted considerable time to attacking a problem that does not really exist.
When it comes to the shape of the MRRT, the big mining companies such as BHP Billiton on the one hand and Bob Brown’s Greens on the other will have more influence than Forrest, Palmer and Rinehart combined.
Swan’s task should be to prepare Australians for expenditure cuts, which will be necessary if Australia is to achieve a budget surplus in 2012-13. And that’s only the beginning. As the Treasury secretary, Dr Martin Parkinson, made clear in his speech last week, for the Commonwealth and the states, ”surpluses are likely to remain at best razor-thin without deliberate efforts to significantly increase revenue or reduce expenditure”.
The immediate problem facing Australia is the prospect of increasing unemployment. Yet this has not been Swan’s focus nor that of the trade union movement. The ACTU secretary-designate Dave Oliver was interviewed on Insiders on Sunday. His concentration was on the role of unions and he barely mentioned unemployment.
Swan seems to be following the lead of President Barack Obama who, in recent times, has expressed sympathy for the cause advanced by the Occupy Wall Street movement, which claims to represent the 99 per cent against the 1 per cent. This is in line with the tactic adopted by President F.D. Roosevelt during the Great Depression. He spent much of the 1930s attacking business.
FDR’s class hatred worked politically, but not economically, as Amity Shlaes demonstrates in her book The Forgotten Man. These days Roosevelt is depicted as one who followed the big-spending policies of the economist John Maynard Keynes. Yet, as Keynes’s biographer Robert Skidelsky documents in his book Interests and Obsessions, the British economy recovered speedily in the 1930s ”in the absence of any fiscal stimulus”. The British recovery occurred much more quickly than in the US, where the anti-business FDR saw the solution in government spending and control. Australia in the 1930s adopted a policy similar to Britain.
Australia’s world-class mining industry is a major revenue stream and a source of employment. Presently it is under attack from the green movement. For Swan to be banging on about the likes of Forrest, Rinehart and Palmer is an indulgence – especially since this trio have not prevented the implementation of Gillard Labor’s policy agenda.