PASSWORD RESET

Magazine of the Socialist Party, Australian section of the CWI

The quiet before the storm

Perspectives for Australia 2018/19

This document was debated and agreed upon at our 2018 National Conference, held in Melbourne on August 11. It builds upon the statement agreed at our 2017 National Conference as well as material produced by the Committee for a Workers’ International (CWI) and articles published in our magazine, The Socialist.

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The political situation in Australia is on the one hand marked by widespread frustration amongst working class people, and a certain politicisation reflected in a deep distrust of the entire capitalist establishment. But on the other hand, we have the contradiction of historically low levels of struggle and a working class that seems disillusioned with politics.

How can people be so unhappy with their lot yet seem somewhat disinterested and reluctant to struggle for change? Will the situation ever turn around, or is struggle off the agenda for the foreseeable future?

These are the questions on the minds of all socialists, as well as many other thinking workers and young people. Understanding the situation requires at least a brief look back at Australia’s development over the past 40 years, and an international perspective. Only in this way can we see things in their proper context and be prepared for what lies ahead.

Neoliberal onslaught

In the aftermath of the post war boom, most major capitalist parties around the world adopted the neoliberal policies of privatisation, deregulation and free trade. In Australia it was the Hawke/Keating Labor governments that first drove this shift in the early 1980s with their Accords. This process was hastened after the collapse of Stalinism.

The new economic conditions saw a push towards so-called ‘small government’, which really led to bigger businesses, with most of the once publicly owned infrastructure and services sold off to private profiteers. While working people were told that privatisation would lead to cheaper prices and better services through increased competition, the exact opposite happened. Take electricity prices, for example, which have skyrocketed.

Deregulation reduced the amount of oversight governments had over businesses, and in respect to industrial relations it led to a severe weakening of the trade union movement. As such, we have seen a reduction in wages and conditions.

Many unionised jobs were replaced with casual and low paid jobs, leading to high levels of insecurity. Today, for the first time ever, less than half of Australian workers are in a permanent full-time job with leave entitlements.

While wages and conditions were being pushed down, corporate tax rates were slashed. Big businesses were only asked to pay a pittance in tax compared to their swelling profits, if they bothered to pay any taxes at all. Free trade and the opening up of markets across the world meant that capital could move freely in the search for more exploitable workforces, and also to countries where it could evade tax.

Big businesses moved to exert an even bigger influence over the major parties, with companies like the big banks and the major mining firms making huge donations to the Liberals, Nationals and Labor. In exchange they have benefited immensely from laws and conditions that have enhanced their profits even further.

Desired results

Decades of this big business and major party collusion cemented a neoliberal consensus and achieved the desired result: a huge transfer of wealth from working class people to the rich. Both wealth and income inequality increased dramatically. The profits share of total factor income rose over the period 1984 to 2017 from 22% to 27%. During the same period, the wages share fell from 57% to 53%.

Adding to big business’ profits bonanza, Australia uniquely experienced a 25+ year economic boom propped up mainly by the mining sector’s exports to China, and more recently a property boom. In both sectors capitalists have benefited from huge tax breaks and corporate handouts. In the case of the property sector government policies have pushed up house prices significantly, leaving millions enduring rent and mortgage stress.

This neoliberal onslaught however has come with its by-products. People now despise the major parties, and they mostly see big businesses and capitalist institutions as rip-off merchants. The Labor Party was transformed from being what was a worker’s party at base, to an out and out capitalist party. From once being seen as a vehicle for working class struggle, they are now seen as just another part of the political establishment.

The banks, for example, have gone from once being seen as highly trusted to now being seen as havens for corporate corruption. A glimpse of their thievery is currently being exposed by the royal commission.

Ordinary people generally know that widespread corporate tax evasion and rorting exist. They know that the system is rigged in favour of the rich. They perceive the political and big business class as greedy and far removed from their own experiences, but also as seemingly untouchable.

Everything appears to be stacked in favour of the big end of town. It’s as if it’s all stitched up and there is very little that can be done about it. The problems working people face seem huge and insurmountable. But how can it be this way when the rich are a tiny minority?

Frustration

People understand that the rich and powerful are a small group, but they cannot yet see how their power can be reined in. In Australia at least no real mass explanation, let alone a viable lead, is being given and from this flows people’s disillusionment.

The frustration that people carry is compounded by the fact that we are told that Australia is special, having missed out on the worst of the global financial crisis ten years ago. It is true that we have so far avoided a major economic shock, but this has not meant that people’s living conditions have not gone backwards.

That said, the lack of a recession for more than a quarter of a century has had a certain psychological impact on people. There is a metaphor that says if you put a frog straight into boiling water, it will jump out. But if you turn the heat up slowly, it won’t react in time. In many ways the heat is being turned up on people, albeit slowly.

The lack of a sharp change in the situation has meant that people have also felt that we are not doing as bad as other places in the world, and if we just keep our heads down we might be able to pull through the difficulties. The capitalist class have taken advantage of the inaction of the working class, using the quiet times to prepare themselves for an inevitable increase in struggle.

Politicisation

The vast bulk of the developments in Australia over the past 40 years have not been unique. Similar processes have taken place in most advanced capitalist countries. This has brewed deep frustration, and a worldwide politicisation which has so far mostly been reflected in a type of populist outrage.

For years this frustration sat under the surface, but in a number of places it has bubbled over in different ways. The so called ‘Arab Spring’, Occupy, the Indignados, the Women’s marches and other mass struggles are but some examples.

In most of these cases, an immediate change in people’s circumstances, often with deep cuts and austerity, was the equivalent of the frog being dropped into the boiling water. People reacted. In some instances, they complemented the struggles on the streets with attempts to create new political vehicles.

In Australia, because the shock of the global financial crisis was dampened by the mining boom and government stimulus measures, people were not forced to respond in the same way. But even so, people have still used the ballot box to express their displeasure with the fact that they are going backwards.

Support for the major parties has dropped significantly, and we now have record numbers of people voting for minor parties, albeit mostly right-wing populist parties at this stage. This phenomenon has led to a prolonged political crisis for the major parties, reflected in the high turnover of prime ministers and the inability of governments to win proper working majorities.

Provoking a reaction

It is striking that despite big business exercising so much control over the economy, politics and society, they are still unable to properly carry through their agenda. This highlights the deep and inbuilt crisis that Australian and world capitalism faces. They are checked in the sense that they know their agenda is unpopular and they risk provoking a reaction if they push ahead too hard or too fast.

But the logic of capitalism forces them to push ahead as they are stuck in a world-wide race for profits. Inherent in the situation is the inevitability of an increase in struggle, as people have both practical and political limits on what they can and will put up with. Capitalism itself is reawakening the working class, albeit relatively slowly at this stage and in a somewhat confused way.

Internationally, consciousness lags behind events, but this is even more pronounced in Australia. Working people are definitely not happy with their lot, and generally have little faith in capitalism as a system, but they are still in the process of realising that it is the organised working class that is the main agent of change. Flowing from this, the rebuilding of fighting trade unions and workers parties is also happening at a sluggish pace.

In some countries you can see that this process is more developed. For example, an increase in industrial struggle is happening in important countries like the US, and in recent years we have seen a number of new left parties set up across the world. We have also seen new life breathed into some older political figures like Corbyn, Sanders and Mélenchon. These examples show that people are groping towards alternatives, albeit from a low base.

Neoliberalism did not just wind back people’s living standards, it wound back working class consciousness. Like Labor, many of the old workers parties have been transformed or have disappeared. The fighting capacity of the trade unions has also been diminished. This has meant that the ideas of collective working class struggle and organisation have been pushed back.

Filling the vacuum

So, while the major parties are seeing their bases dwindle as people shift away from the neoliberal orthodoxy, no other mass political force yet exists that is capable of filling the vacuum. In this environment, different political forces are vying for influence. While socialists are trying to offer a left alternative to big business domination, different types of right wing forces are also trying to step into the breach.

The right-wing populism of the likes of Trump and Hanson is a phenomenon that stems directly from people’s dissatisfaction with neoliberalism. Populism in general pits ‘the people’ against the ‘elite’, but in contrast to the left populism (e.g. Sanders, Corbyn etc) that sees the conflict as between the ‘99%’ and the billionaire class, right populism tends to lean on divisive racist ideas, fashioning the ‘elite’ as a politically correct cohort that indulges supposedly problematic sections of society, like migrants.

Often right populism is mixed with economic nationalism, which favours elements of state intervention and protectionism. Mixed with anti-establishment rhetoric, it can sometimes also seem to rail against the neoliberal consensus. To some sections of the working class, right populism can seem like an easier road, as it only requires dealing with piecemeal problems (like immigration) as opposed to the actual systemic problems.

At the end of the day, because right populists do not have an alternative to capitalism, they are unable to adequately deal with the problems the system creates. They can find themselves quickly exposed, or under huge amounts of pressure, as their rhetoric and their actions come into conflict. This can lead to divisions and splits as seen with the parties of Palmer, Lambie and Hanson.

The truth is that the racist scapegoating that is so often part and parcel of right populism is a diversion from the real causes of the problems we face. Ultimately it seeks the preservation of the profit-driven system. This will be further exposed as people try out these right populist figures and are inevitably disappointed.

Class consciousness

The evolving battle between left and right populism is really an opening stage in the re-emergence of class consciousness. The left populist, moderately reformist organisations and figures that have appeared internationally are a progressive development and represent a break from neoliberalism. We need to have a certain orientation to these developments wherever we can.

But ultimately, we need more than just a break from neoliberalism. We need a break from capitalism itself. Capitalism in this era is not prepared to grant reforms in the same way as it did during the post war boom. Today, capitalism is a crisis ridden, thoroughly parasitic system. That said, it will take time and more experience for people to draw these conclusions. In the meantime, people will most likely flirt with left populist and reformist organisations.

In Australia while we have seen different versions of right populism, we have not yet seen a fully-fledged left populist organisation or movement. The ACTU’s Change the Rules campaign is probably the closest thing so far.

But while there is widespread support for the ideas put forward in the Change the Rules campaign, the ACTU are refusing to channel that support in a progressive direction. Instead, they are directing people back into the orbit of the Labor Party. So, in addition to right populist figures being promoted by parts of the capitalist press, and in addition to right populism being seen as an easier road for some, the growth of left populism is being held back by the conservatism of the union leaders.

This will not be the case forever. At some stage, people will either drag the union leaders into line, or else move around them and throw up a figure or an organisation that better represents their interests.

Even the divisions within the major parties reflect sections of the establishment who want to move in a more populist direction to try and hold onto to their shrinking base. It is not ruled out that these divisions could lead to more splits within the mainstream parties in the future, and the development of more populist leaning parties of both a left and right variety.

This will only further undermine the two-party system and make it even more difficult for the major parties to form majority governments.

Switched off?

While people seem to be switched off politics at the moment, it would be more accurate to say that they are switched off the political establishment. Polls consistently show rising scepticism towards institutions like courts, the mainstream media and the parliament. Compared to even just a decade ago a real politicisation has taken place, with many more people now thinking about how society and the economy works.

A recent global survey showed support for socialism is rising with fully half of all people thinking that socialist ideals are of great value for societal progress. No doubt there is still confusion about exactly what socialism means, but the survey pointed to a definite widespread disillusionment with the status quo.

Even in Australia, 49% thought socialist ideals were of great value and 76% thought the rich should be taxed more to support the poor. 88% supported education being free, and 89% supported free healthcare as a human right. For the most part, these views did not come about because of socialist propaganda, but because of how capitalism has worn people down.

Important layers of people have already drawn some fairly radical conclusions before any major economic shock, and without the presence of a mass socialist force. These changes in people’s outlook will not be put back into the box. This generally leftward shift will develop even further in the coming years and it is a good foundation from which to build from.

Even now, the potential exists for people to make a turn towards struggle and real politics. The main thing missing is a viable lead being shown. While no left force is currently a big enough pole of attraction, the trade union movement does have the potential to help turn things around and reinvigorate the working class with a new political outlook.

Possibilities

While the ACTU’s Change the Rules campaign has already given us a glimpse of the possibilities with the 100,000 strong demonstration in Melbourne, the ACTU leaders are currently squandering that potential by diverting people’s frustrations into the dead end of a Labor Party election campaign.

To some extent, politics will be forced on people to a greater extent in the coming months, with a federal election due sometime before May 2019.

The government’s most recent budget was an attempt to curry favour with voters prior to the election, but still it did not really provide them with a bounce in the polls. While Labor is currently slightly ahead in the polls, opposition leader Bill Shorten is far from popular. It is still too early to say who will win the election but there is a chance the Turnbull government could be thrown out, only to be replaced by an equally weak Shorten government.

That said, much can happen between now and election day. As we have discussed before, the Australian economy rests on weak foundations with the mining boom having peaked and the property boom being based on a huge speculative bubble.

Retail spending is flat and a major factor that has kept the economy out of recession is the billions of dollars spent by governments on stimulus in the form of infrastructure spending. This is an admission that, on its own, Australian capitalism has no new motors of growth ready to fire.

The property bubble has the potential to burst and a number of international factors, like the looming trade war, are adding to the instability that exists. Any shift in the economic situation would add new dynamics to an election campaign and create major headaches for any new government.

The ACTU’s Change the Rules campaign could be a decisive factor in the election campaign. While Change the Rules is in some senses more political than the Your Rights at Work campaign they waged 12 years ago, it is also less co-ordinated and the current leaders are less inclined to use the weapon of industrial action and mass protests.

That said, a shift in direction could be forced upon the ACTU if a major industrial dispute breaks out or if there is a change in the economic situation. Under pressure from below they could be forced to take the campaign further than they have anticipated. No doubt the campaign adopting a more fighting approach would assist Labor, but workers should expect nothing but crumbs if Labor are thrown back into power.

So far, the ACTU has refused to put any real pressure on Labor, despite the fact that Labor have refused to endorse most of the ACTU’s demands. In power Labor would be under pressure from their big business backers, and without the pressure of a mass movement they will not even hand over the most basic of reforms. These problems would be compounded if Labor comes to power amidst a recession.

Greens

The Greens, despite positioning themselves to the left of Labor, have failed to attract many of the voters disillusioned with the major parties. They too have tensions within their organisation between the leadership and those who want to pull in a more left populist direction. But the right-wing of the party currently holds the upper hand, having slapped down much of its opposition.

As the centre of politics collapses the Greens leaders cannot see the forest for the trees, and are instead desperately trying to be seen as the ‘responsible centre’. To most workers, the Greens are seen as a bunch of well-to-do inner-city do-gooders far removed from the issues of low pay, housing stress and insecurity. Their refusal to focus on working class issues means they have put limits on themselves and they will most likely cut themselves off from a future leftward shift amongst the working class.

While we could not totally rule out leftward shifts within either Labor or the Greens, it seems unlikely that either of those organisations will be catalysts for progressive developments. If any change does take place within them it will mostly likely be a result of the pressure of new social movements along with new leaders being thrown up within their ranks.

New movements

While large scale social movements have been few and far between in recent years, a shift in the economic situation would change all that by bringing class issues to the fore. In fact, new social and industrial movements are inevitable in Australia in the not too distant future. While it’s not possible to predict the exact form or timing, we can definitely say that the experience of the past 40 years has built the inevitability of struggle into the situation. International experience also backs up this prognosis.

We should note though that there is no straight line between economic recession and an increase in class struggle. Depending on the severity of the coming economic downturn, and the changes experienced, people could be somewhat shocked. Different layers will respond differently depending on their level of confidence.

As we have seen elsewhere in the world, a seemingly apathetic working class can be shaken up and throw themselves into struggle. This can especially be the case if people feel that their already meagre existence is being undermined further.

It is not possible to predict the exact issues that people will fight around, but we do know the areas where people are under pressure the most. We know for example that housing stress is a huge issue, and any bursting – or even deflating – of the property bubble will massively aggravate the issues that exist. The housing situation is made much worse by the extremely high personal debt levels that people have. Those who are heavily mortgaged will be some of the first affected, but all parts of the working class will suffer from a crash in the housing market.

An increasing number of young workers are renting as home-ownership becomes less and less attainable. Our new Renters Fightback campaign is an attempt to address some of the issues facing renters, especially young renters locked out of buying property. We hope to use the campaign as a way to connect with any struggles that arise.

Low wage growth is also a huge issue in Australia and, if there is pressure from below, the unions can be forced to act more on this front. The Change the Rules campaign is already an expression of the pressure building up from below, and if a Labor government was elected people will have increased expectations for Labor to raise wages and pass laws that make striking easier. New struggles can erupt out of these industrial issues.

Shifting attitudes

The campaign for marriage equality was something that we threw ourselves into after our last National Conference. That campaign highlighted the progressive shift in social attitudes that has taken place in recent years. While there is a certain sense of relief that same-sex marriage has now been won, the reform will not address other forms of LGBTIQ oppression and there is the potential for people to want to struggle further on that front in the coming years.

The same goes for Indigenous and women’s rights. Across the world we have seen a stepping up of different movements and campaigns against racial and gender oppression. While some advancements have been made in highlighting the issues, only a few concrete reforms have been won so far. As people realise that it is the system itself that holds back oppressed people they will seek to take their fight in a more anti-capitalist direction.

That will also be the case with other social issues like the environment. People understand that big business is to blame for the wrecking of our planet, and the potential exists for struggles to flare up as people demand a shift away from fossil fuels. The climate crisis highlights how perverse the capitalist system really is. In its quest for profits, the system will stop at nothing, up to and including ruining the planet itself.

The period that we are moving into will be even more crisis prone than the decade just gone. The neoliberal period was, if you like, a more normal phase of capitalism with people’s living conditions being under constant attack. The post-war period of reforms before neoliberalism was thoroughly unique and it will not be returned to.

While it will take some time and experience, people will increasingly come to see that their choices really are between socialism and barbarism. A new more democratic and just way of running society is desperately needed.

Generally speaking, dominant trends in society tend to ebb and flow over periods of decades. After several decades of relative quiet in Australia we are starting to witness the beginnings of change. While organised socialists are few and far between right now, the stage is being set for this to change. What we are really experiencing is the quiet before the storm. While people seem somewhat disinterested and reluctant to struggle, this is a temporary phase.

Out of necessity people will move into action, and because of the politicisation that has already taken place, many will be open to radical ideas, including socialism. This is not just our hope, but it is a perspective based on what workers in Australia have done in the past, and on how workers in other parts of the world have responded to capitalist crisis in recent years.

Our task, as this new period opens up, is to win support for the ultimate solution to people’s problems – democratic socialism. There is no doubt that millions of working people are capable of realising that they are the majority, and that if the majority is organised and mobilised, they have the potential to change the world.