IAN McAULEY. Reclaiming the ideas of economics: Aspiration

“Aspiration” used to mean something more noble than greed.  We need to claim it back.

Summarising his praise for the Coalition’s tax cuts, conservative columnist Tom Switzer wrote:

The passage of the federal government’s tax-cut legislation fulfils a major Coalition campaign promise, but more important is that it marks a return to the politics of growth and aspiration.

In itself Switzer’s reference to “aspiration” has no defined meaning: the word “aspire” simply means to strive or to be eager – eager to achieve an unspecified something. It is what the philosopher Claude Lévi-Strauss called an “empty signifier” – something to which anyone can attribute any meaning.

The Coalition has provided its own meaning of “aspiration”, and it’s about getting rich. Not the richness of accumulating learning, friendships, experiences and respect, but the specific accumulation of material and financial assets, by whatever means legally possible.

There is nothing wrong with aspiring to make oneself financially secure, but from a moral perspective the means by which one achieves that end do matter. Do we achieve it through our own effort, through entrepreneurship, through taking a chance, or do we achieve it through taking from others – through reaping where others have sown and tended?

The means most favoured by the Coalition in recent times has been property speculation, supported by permissive tax allowances on capital gains and negative gearing.

Where existing or already-planned properties are involved, this is not wealth-generating investment. No new assets come into being: it is simply a transfer of wealth, and those who pay are mainly the young who are condemned to perpetual rent or cripplingly high mortgages.

Another consequence is a high turnover in housing ownership and occupancy, to the detriment of social stability.  It’s hard for supportive neighbourhoods to develop when an increasing proportion of people may be forced to move any day because their landlord wants to make a capital gain or has found it too hard to service his or her debt.

Labor in its time has given incentives for people to become financially secure, but in ways that help create new wealth. Labor introduced dividend imputation, giving individual investors an opportunity to share in the nation’s prosperity through equity in wealth-creating companies. (But they never intended it to be a means to live a tax-free retirement on a high income). Labor also introduced capital-gains tax indexation, ensuring investors were not penalised for their patience. Above all there was Labor’s introduction of near-universal superannuation, which has given all working Australians a chance to share in real wealth-creation.

In the name of “aspiration” the Coalition has undermined those initiatives. Individual share ownership has given way to property ownership. This is not simply a shift in asset class: it’s a fundamental shift in our economy’s incentives and rewards. If small investors enthusiastically buy up BHP shares to the point that they become overpriced, they and other investors may suffer some loss, but they don’t deprive others of shelter or destroy communities.

The tax system has been used as a means to help people get rich at others’ expense, rather than to provide incentives for people to invest in wealth-creation.

To put it simply, what the Coalition means by “aspiration” is “greed”. Talking on Big Ideas, Saturday Paper editor, Erik Jensenmade it clear that Prime Minister Morrison not only shares that narrow view of “aspiration”, but also that he has embellished it with religious justification:

Scott Morrison … said ‘your aspiration’, and I use that word because he does, but the word I would prefer to use is greed, your greed is good, it is decent and it is humble, and if you work you deserve it, and that is essentially a Pentecostal dictum.

Morrison’s Australia is an Australia built on that cleave, between the worthy and the unworthy, and the worthy in Morrison’s Australia are already rich and they will seek only to become more rich.

This is a long way from what Labor, and most Australians whose ideas of wealth go beyond individuals’ assets, have traditionally meant by “aspiration”. In a reflection on Bob Hawke’s life published in The Monthly nMungo MacCallum wrote about “aspiration”:

When Scott Morrison praises aspiration he means personal gain, the accumulation of assets – what was once called avarice and greed.

When Hawke and Kelty used the term they meant rising above ourselves, setting worthwhile aims for the nation, even the world, listening to our better angels.

It’s too powerful a word to be owned by those who make it a euphemism for “greed”.

 

This is the second of a series of articles in Pearls and Irritations  on reclaiming the ideas of economics. The General introduction  was published on September 19.

Ian McAuley  is a retired lecturer in public finance at the University of Canberra and a Fellow of the Centre for Policy development.

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6 Responses to IAN McAULEY. Reclaiming the ideas of economics: Aspiration

  1. Charles Lowe says:

    Sorry to pour cold water on your parade.

    This Government is simply opportunistically exploiting the ability of baby-boomer parents to financially support (temporarily or otherwise) their offspring. In terms of ‘wealth transfer and preservation’: not a hassle.

    Little “greed”. Just a buttress to preserve (if not extend) the status quo.

  2. DON OWERS says:

    David Attenborough the worlds most esteemed naturalist said : “Anyone who believes in indefinite growth on a physically finite planet is either mad, or an economist.”
    David Suzuki also a world famous naturalist and was 3 times voted the most trusted person in Canada. He described economics as “a form of brain damage” and a “pretend” science and economic growth as suicidal.

    The great economist John Kenneth Galbraith once said, “The only function of economic forecasting is to make astrology look respectable.”
    Speaking of former US Fed Chairman Alan Greenspan, another economist quipped, “He was the greatest, the Maestro. Only if you look at his record, he was wrong about almost everything he ever predicted.”
    The Wall Street Journal once proclaimed, “If pilots’ vision were as bad as economist’s railways would be profitable.”

  3. Ian Buckley says:

    Ian McAuley makes excellent points on the Orwellian tricks used to make our undemocratic neoliberal economy appear morally just, hoping to obscure its ever-increasing world-wide maldistribution of wealth. The Scott Morrison quote as to the supposed virtues of ‘aspiration’ (greed) is a clear example of a desperate need to convince the growing mass of doubters. Indeed, religion has always been ‘called up’ whenever crimes become extreme, especially those of war. Thus in 1908, anticipating war, Britain’s Ambassador Sir Cecil Spring-Rice wrote the following poem, it later used as a suitably ‘aspirational’ hymn (used in churches and schools).

    I vow to thee, my country, all earthly things above,
    entire and whole and perfect, the service of my love:
    the love that asks no question, the love that stands the test,
    that lays upon the altar the dearest and the best;
    the love that never falters, the love that pays the price,
    the love that makes undaunted the final sacrifice.


    And there’s another country I’ve heard of long ago,
    most dear to them that love her, most great to them that know;
    we may not count her armies, we may not see her King;
    her fortress is a faithful heart, her pride is suffering;
    and soul by soul and silently her shining bounds increase,
    and her ways are ways of gentleness and all her paths are peace.
    Source: Ancient and Modern: hymns and songs for refreshing worship #579

    Missing, an all too frank message, verse 2 went:-
    I heard my country calling, away across the sea,
    Across the waste of waters she calls and calls to me. Her sword is girded at her side, her helmet on her head, And round her feet are lying the dying and the dead.
    I hear the noise of battle, the thunder of her guns,
    I haste to thee my mother, a son among thy sons.
    (Clearly blasphemous, its evil aims should make it illegal)

  4. Kien Choong says:

    Nice essay on the different conceptions of aspiration – self-accumulation vs self-improvement. Both seem self-centered?

    We could also aspire to goals that go beyond our own self well-being to include (say) fairness, equity, elimination of poverty, environment, …

    But nothing wrong with having self-centered goals per se.

  5. Wayne McMillan says:

    Ian, I would respectfully suggest if you want to bring the public good or common good, back into Economics, have a look at the current paradigm the dominant neo-classical synthesis. This is an erroneous theory with mathematised models being propagated left right and centre, all only poor approximations to reality. Economics as it’s taught needs an overhaul and urgently. Please I implore look carefully at what is being taught in universities and then realise this is a major problem. Organisations like Rethinking Economics, Economics Reform Australia and the Modern Money Network, Centre for a Steady State Economy CASSE are waiting for you to join us in developing a new 21st century Economics, but all of us need to work together and collaboratively as time is running out for our planet.
    Best Wishes
    Wayne

  6. Abul Rizvi says:

    Well said Ian.

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