Citizen Murdoch and AlbaneseApr 18, 2022
First came the puff piece in ‘The Australian Women’s Weekly’ and then the softball profile on ‘Sixty Minutes.’ One could sense Citizen Murdoch and his editors would be observing that Albanese was beginning to look a winner, and Morrison more clueless by the day.
Time to begin to let the sun set on the full-blooded support Murdoch has given Morrison since he stepped into Turnbull’s shoes. Time to make sure the policies of the potential new Prince fell into line with those acceptable within the corridors of power at News Corp.
Globally Murdoch is a declining force. Major parts of the empire have been sold off. But in Australia he is still the kingpin. He was never going to sit on the sidelines and let his few competitors make the running on smoothing the path to Albanese’s anointing. Of all his Australian assets none wields more influence than the Daily Telegraph. It reaches right into suburban heartlands, and shapes minds and votes that the major parties must gain. These parties bow down before the Daily Telegraph both at a state and federal level. Stories in the Daily Telegraph can appear in Murdoch’s other tabloids throughout Australia, and be picked up by TV stations.
It was thus no accident that when News Corp moved, the vehicle chosen was the Daily Telegraph. The interview with Albanese was a pastiche of the punchlines the Labor leader has been trotting out at business forums and other venues across the country. Every line in the article framed Albanese as a safe pair of hands.
These days Albanese is firmly in the ambit of the liberal centrist position that is music to the ears of business leaders and the mainstream media. It was the standpoint of Murdoch when he launched The Australian. Today Murdoch is an arch-conservative but as he showed with Blair in Britain, he can live comfortably with the mild reformism of Labour governments. And he can hedge his bet for if Labor wins, the Australian with its battery of right-wing opinion writers will day in and day out make sure that any deviation by an Albanese government will be heavily chastised. The Australian was a key player in the coup that deposed Whitlam in 1975, and although it annually clocks up heavy financial losses it is kept afloat for it remains an essential part of Murdoch’s clout in Canberra.
Young Lachlan, glued to his father’s side, has recently been in town giving a vacuous reactionary speech to a right-wing think tank. He will have rallied the troops in an outpost of the family empire to make sure the Canberra baton will only go to someone who is a safe pair of hands.
Albanese in the interview in the Daily Telegraph declared he wants to lead a party of mainstream Australia. He repeated a number of times he wanted to be a friend of business. He stressed his belief that business and unions were in accord and the overarching aim of the economy was to lift profits and wages whilst boosting productivity. Elsewhere Albanese has invoked the spirit of the Hawke-Keating epoch that began in 1983. Albanese opines their consensus and cooperative program not only delivered Medicare and universal superannuation but at the same time boosted wages and profits. Albanese views the Hawke-Keating years through a rosy hue. He is eager to duplicate their program. Viewed from a more realistic angle the Hawke-Keating pluralist model contains a salutary lesson for Albanese. It was a policy experiment that at its inception contained the seeds of its demise.
It is easy for any aspiring Prime Minister to build castles in the air about the capacity of civil society to create harmonious relationships between various stakeholders, but in order to work a pluralist model requires a distribution of power that strikes a fair equilibrium. Hawke and Keating created an asymmetrical economic policy and in time paid the electoral price. Albanese needs to tune his political antennae if he wants to avoid the pitfalls of the Hawke-Keating era.
There was no straw that broke the camel’s back and led directly to the demise of the Hawke-Keating program. There was a combination of factors that ruptured the fragile alliance between the constituent elements of labour and business that the Hawke-Keating pact attempted to unify.
The core of the Hawke-Keating economic and industrial relations policy was an arrangement termed the Accord. Everything Albanese says echoes the themes struck in the Accord. In essence under the Hawke-Keating Accord the theory was government would operate with both business and the unions and this tripartite deal would implement social and economic policy. On the social front Medicare and universal superannuation evolved from this partnership. It was the social welfare reforms of this type that produced a string of Labor victories at the polls. But they were flawed reforms, and the concession they demanded in reduced wage claims chipped away at the parliamentary primary vote of Labor. Medicare lacked a truly egalitarian edge. Its scheduled medical fee rebate system provided only a portion of the charge imposed for specialist services, and lack of dental cover has blighted its record. Workers had to dig in to shrinking real wages to offset the sums they had to pay for medical services.
With universal superannuation since leaving politics an older and wiser Keating has spent years railing against business not stumping up enough of a levy to provide a comfortable retirement for the workers who laboured to build modern Australia. He has piercingly pointed out that in recent years none of the increases in productivity went to wages. It has instead gone to the profit share of national income. These productivity based profits, notes Keating, need to be channeled to the universal superannuation scheme in order for retired workers to be less reliant on the parsimonious state pension in old age.
Even in the early years of the Accord when the economy and employment were humming, real wages were cut as the mantra was to boost not wages but the profit share. As average earnings limped along personal debt tripled. This was a clear sign the punters who were the backbone of the tide that lifted the boat of Labor electoral support were wallowing. Real wages continued to fall across the period Labor were in power and the profit share soared. As the wages share of national income fell whilst productivity escalated Labor began to walk along the path of electoral perdition. In a nutshell, workers were not being compensated for boosting their labour output. A deep recession in 1990-91 ebbed away support for Labor. But in the 1993 election Hewson grabbed defeat out of the jaws of victory with the terror he struck over the introduction of his planned GST and Keating nicked the election.
Keating survived, but the lessons were not learnt. He was incorrigible. At a business lunch shortly after the 1993 election he spoke about his record of boosting the profit share and lifting productivity whilst slashing unit labour costs, and coupled that with prefiguring the end of industrial awards and a shift to enterprise bargaining. A ninety-year-old collective wage bargaining system that Labor had always promoted as an article of faith ensuring wage justice was being hollowed out by a Labor government. Through all this the business elite boomed and millionaires proliferated and there was no evidence of profits being used to fuel the investment needed if manufacturing were to be revamped, and a clever country take off. Commodity exports remained the backbone of the economy.
In 1996 the voters threw up their hands and Labor had its lowest primary vote since the Great Depression. Workers had despaired after years of low wage growth, increased work tempo, and empty promises of a pluralist heaven that was always over the horizon. The Accord faded into history only to be resuscitated more than twenty years later by Albanese’s pitch. Business that had never been an official party to the Hawke-Keating Accord banked its profits and through the Business Council of Australia drove the Howard government forward as it introduced statutory individual contracts and peeled back dismissal laws and the award system in an even more comprehensive fashion than Keating envisaged.
On China, Albanese promised The Daily Telegraph his government would be as hardline as the coalition, and develop an even stronger bond with the US. He has noted in recent months he regularly chats with Paul Keating. Their conversations would be interesting. Albanese’s hawkish approach on China would not resonate with Keating. The ex-Prime Minister is one of Australia’s finest public intellectuals, and has developed his ideas at a quantum level since he lost office. Keating understands that the US is an overstretched power that treats Australia as a client state as it strives in a hapless fashion to contain the rise of a rival destined to eclipse its role in the Asia-Pacific region. The US thinks it will click its heels and Australia will be part of a war over Taiwan that (as Keating has noted) it cannot win.
Albanese in the Daily Telegraph speaks in glowing terms about Curtin’s WW2 turn to the US as being the foundation of a perpetual Australian alliance with the US. This is a coat-tail theory of history that courts disaster. Curtin was a realist and adapted his politics to events of the day as he realized the UK was finished as a global imperial power, and incapable of defending Australia. Albanese needs to stop listening to the bloated pro-US intelligence community in Canberra, and their press acolytes, and put national independence first―and play off the competing parties seeking hegemony in the Asia-Pacific region to Australia’s benefit. The Solomon Islands, one of the smallest nations in Australia’s Pacific orbit, has learnt that trick and how it has upset those in Canberra in lockstep with the US. Albanese needs to turn a deaf ear to their quisling viewpoint.
The past is, as the expression, goes another country. They do things differently there. Albanese needs to find new campaign lines. Harking back to some golden political age where labour and business shared productivity gains whilst wages and profits rose in unison perpetuates a myth. The pursuit of economic democracy cannot be boiled down to nostalgic lines drawn from memory lane. It is naïve to believe that business will be a selfless co-partner in something that resembles Accord Mark Two. Unions are far weaker today than during the Hawke-Keating era and capital has even less reason to do anything more than pay lip-service to anything smacking of a pluralist relationship with its workforce. Currently the profit share is high and wages have been flat-lining for years. Albanese will have zero chance just as Hawke and Keating did of watching rising productivity being shared between capital and labour. One way of raising wages is through a labour shortage: but that part of free market doctrine, as the present is showing, seems as busted as most other maxims of neoclassical economics. In a profit system maximizing profits is the only game in town, and the theatre of politics on the hustings a passing parade.