It is not just the bankers who have lost status under the spotlight of our Royal Commission. Australia’s governing classes in their entirety are diminished. Our politicians on both sides of the House, our regulatory bureaucracies, the media, our Professors of Economics and Business Administration, our “independent” think tanks and their incessant propaganda of deregulation and privatisation … It is time for all of them to go back to school.
As the Royal Commissioner in his gumboots wades through the sewer of Australia’s financial system with a clothes peg on his nose well might we ask, where do we go from here? Nobody knows. We have reached a stage of tertiary capitalism that might be compared to tertiary syphilis. You don’t have to cut off your nose to spite your face. It just falls off.
A more pertinent question is how do we go from here? We go quietly. It is a time for our diminished governing classes to pipe down and listen, to get out in the community and hear what people have to say. The Parliament has not heard this message. The budget debate was surreal and then it was back to juvenile point scoring on citizenship qualification, the ultimate adversarial folly.
On 17 August last year, I emailed the local Labor member of parliament. “Bill Shorten should make quite clear to Malcolm Turnbull and to Barnaby Joyce and the general public that Labor will grant Joyce a pair if he is knocked out on this ridiculous constitutional technicality and the government can retain office pending a by-election for New England. Not sure how that would work. May be necessary to prorogue the federal parliament as we saw in Perth for the Ascot by-election.
“Either way Labor should be conciliatory and sympathetic to the people who have been caught out by this triviality. It could easily happen to us…… Labor should cooperate with the Liberals to get something more sensible in place, even if it means a referendum. The process is too complicated. It is not just our country that changes the rules during people’s lifetimes. It is other countries.”
I wonder if anybody has kept count of the number of Premiers, Ministers, Prime Ministers who have left the Parliament to work in our grotesque financial system. They knew what was going on. The obscene managerial salaries and bank profits were no secret.
As the Royal Commission provides official confirmation that Australia’s officers on the poop deck are a waste of space it is reassuring to know that there is still quality below decks. On Friday I visited a friend who had been flown down from the North West to Royal Perth Hospital with a broken leg. She was in the upper category of domestic violence, having been run over by a car. A bright young man who volunteers at the hospital guided me all the way to the ward on the fifth floor. Throughout this big hospital, everybody was helpful, polite, friendly. It is as if the general public, having realised the top end of town is incorrigibly useless, has devoted extra energy to the community at the grassroots. The goodwill was palpable. It made my day.
In a thoughtful comment posted on The Real World Economic Review of 24 April, David Ruccio questions the utopianism underpinning neoclassical and Keynesian economics. “Because they know how the macroeconomy works – because of their theoretical and modelling certainty – both Keynesian and neoclassical economists claim for themselves the mantle of scientific superiority.” Ruccio quotes an earlier comment he made in 2010. “Neoclassical economists failed to see the onset of the current crises; they have had little to offer in terms of understanding how the crises occurred, even after the fact; and they certainly haven’t had much in the way of good policy advice to solve the problems of unemployment, poverty and inequality.
“On another level, mainstream economists have succeeded. Not only have they maintained their hegemony within the discipline, their models and policy advice have kept the discussion to tinkering with the existing set of capitalist institutions. In terms of policy, a bail-out of Wall Street and a mild set of financial reforms, a small stimulus programme and an expansionary monetary policy. And intellectually, a rediscovery of Keynes and an allowance of behavioural approaches to finance. They haven’t proposed even the public works programme and financial reorganisation of The New Deal, let alone an honest debate about capitalism itself.”
In his massive volume “Capitalism Competition Conflict Crises” that I am reading slowly Anwar Shaikh identifies weaknesses in neoclassical and post-Keynesian economics and finds himself returning to the classical school of Adam Smith, David Ricardo and Karl Marx.
This is a time to speak quietly and think deeply. One statement can be made with certainty about the Australian scene. In terms of respect and status with the general public, the Royal Commissioner towers above the Government that appointed him and the Opposition and any other institution silly enough to step into the ring. If and when the Commissioner asks for extended terms of reference and more time it is hard to imagine anyone having the hide to knock him back. The Royal Commission is a starting point for the root and branch examination of our political economy that we never had in 2008. There was a patch-up job here and overseas and the foxes were left in charge of the chook yards.
Jerry Roberts is a journalist by trade and a member of the Australian Labor Party.