Guy Beres » Socialism

Ideology is such a lonely word

Guy — Thu, 26 Feb 2009 11:07:47 +0000

Kevin Rudd’s 7700 word essay on the global financial crisis, published in this month’s edition of The Monthly, was a remarkable contribution to serious political debate by a sitting Prime Minister. What isn’t remarkable given its length and lack of humor is that it appears to have gone down like a lead balloon. Mentions of the essay in the media seem generally restricted to pointed criticisms of it from members of the Opposition or their sympathisers. A few journalists (such as The Australian’s Matthew Franklin) have even had a go at “Julie Bishoping” the Prime Minister, on the somewhat flimsy pretense that 26 words of the essay’s 7700 words were almost identical to a passage that appeared in an recent Foreign Affairs article. Err… ouch [wet noodle limply falls to ground].

For the benefit of those who haven’t splashed out on the magazine, I am going to try and offer a hopefully more level-headed summary over the fold.

If I was going to try and distill the key message in Rudd’s essay down to a single argument, it would be that the global financial crisis has delivered the tangible basis necessary for social democrats to push their natural agenda. Kim Carr was unhelpfully exaggerating when he suggested on radio today that “no one’s job is safe”, but the emotion of the comment sits smugly alongside the current mood of the nation. Every day seems to bring some new economic bad news, some new unfortunate turn of events that will result in financial trauma for some. If the public of Australia had every reason to think during the Howard boom years that there is no reason why the good times could not last forever, the last six months have surely smashed that expectation completely.

In his essay, Rudd describes the current crisis as (p.22):

… the culmination of a 30-year domination of economic policy by a free-market ideology that has been variously called neo-liberalism, economic liberalism, economic fundamentalism, Thatcherism or the Washington Consensus.

This assertion seems like a bit of a distortion; I think it’s fair to say that the neo-liberal consensus created the conditions necessary for the current crisis to eventuate, but that would be the extent of it. Rudd goes on to highlight a more tangible manifestation of this (p.23):

In the United States, the pursuit of financial deregulation crossed the Rubicon with the repeal of the Glass-Steagall Act, which had been established in the wake of the Great Depression. In the heady bubble years of the 1920s, American commercial banks, whose traditional function was simply to take deposits and make loans, plunged into the roaring bull market, trading on their own account, underwriting new stock issues and participating in reckless speculation. When the stock-market bubble burst in 1929, it took commercial banks with it, causing a devastating chain reaction which affected the entire economy for a decade.

…

After a $300 million lobbying effort by the financial-services industry, Glass-Steagall was effectively repealed in 1999, removing the prohibition on commercial banks owning investment banks. The door was now open for the creation of huge financial-services conglomerates.

Someone who has maintained a closer watch on the financial services industry than I have over the last few decades would be probably be in a better position to judge if this event really was the straw that broke the camel’s back. This nevertheless seems an incisive point. If the global economy is underpinned by the smooth functioning of banking systems in the world’s financial centres, is it really a good thing that they have been given a license to gamble the prosperity of the world on the rise and fall of global financial markets? Is it a good thing that banks are permitted to trade widely in financial instruments that are based on ill-offered loans? Does anybody seriously believe that these are not, given recent months, rhetorical questions only?

There are a few points in the essay in which Rudd does get a little bit political. When singing the praises of the “social democratic project”, the Prime Minister is careful to highlight the Hawke and Keating (but not Whitlam) Governments as prime examples of social democracy in sublime flight (p.25). Many of us would of course recall things seeming a little less than sublime at the time. After pointing out, correctly, that neoliberals have had their beliefs tied in knots by this latest crisis (e.g. particularly with respect to part-nationalisations, pp.25-26), Rudd makes an attempt at tying the Liberal Party in closely with the neoliberal school of thought (pp.28-29). It is a bit of a half-hearted attempt, to be honest; of the nine demarcated passages in the essay, just one makes any substantive reference to Labor’s direct political enemy. This passage also represents the weakest part of the essay, and somewhat over-emphasises the extent that our local Coalition schmucks actually endorse the neoliberal agenda in the American sense. No neoliberal government worth its stripes would have presided over the massive welfare churn machine that the Howard Government presided over during its decade in office.

The essay concludes with Rudd lauding the role of government (p.29):

How could it possibly now be argued that the minimalist state of which the neo-liberals have dreamt could somehow be of sufficient potency to respond to the maximalist challenge we have been left in the wake of this most spectacular failure of the entire neo-liberal orthodoxy? Government is not the intrinsic evil that neo-liberals have argued it is. Government, properly constituted and properly directed, is for the common good, embracing both individual freedom and fairness, a project designed for the many, not just the few.

Fine words – but words that now need to be transmuted into action. Governments like those lead by Barack Obama in the United States and Kevin Rudd locally need to deliver on the promise they are offering. Here’s hoping that the next significant step in this new “social-democratic project” that Rudd spruiks in his essay is constituted of something more than mere words.

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Modern politics and that dirty, dirty word

Guy — Wed, 05 Mar 2008 21:23:03 +0000

One of the most obscene political words that one can use today, should one attempt to use it in some positive light, is of course socialism. To attempt to suggest that any particular socialist government might have achieved some good things for the country during its time in office is effectively tantamount to saying that you wish that George Bush or Kevin Rudd could be more like Joseph Stalin. In public discourse, we may as well just pretend that the word “socialism” and variants thereof have been blacklisted by some global, authoritarian political language regime. In the new political lexicon compiled by the enlightened victors of the Cold War, everything whatsoever associated with socialism is bad – or worse, evil. For some, this faith in the fact that socialism and everything associated with it is evil transcends the intellectual and becomes a quasi-religious fervour. As sure as Satan is evil, for such people, you can rest assured that socialism is evil as well.

In mainstream political culture, the central avenue through which this curious treatment of the word “socialism” emerges is through the world’s major centre-left political parties. The Labour Party in Britain and the Australian Labor Party have both publicly exhibited some embarrassment at retaining a reference to socialism (being a dirty word, and all) in their respective party constitutions. Soon after Tony Blair assumed the leadership of the Labour Party in 1994, the party voted to change the wording of Clause IV of its constitution to “modernise” the party’s relationship to the so-called “socialist objective”. The revised clause does interestingly make a reference to socialism (albeit qualified with “democratic”), but removed the admittedly anachronistic references in the clause to the common ownership of the means of production, distribution, and exchange. The Australian Labor Party has also discussed dropping the “socialist objective” from its constitution given socialism’s “taboo” status, with Kevin Rudd even going so far as declaring that he has “never been a socialist and never will be a socialist” after being elected Opposition Leader by the party in December 2006. To that, one would have to wonder precisely what Kevin Rudd means by “socialist”, given his known religious views and support for public health and education.

All this namby-pamby tip-toeing around the word socialism does, for someone like myself who believes that not everything associated with socialism is evil, intellectually grate. It makes comments like these from London Mayor Ken Livingstone in an interview with The Guardian seem quite refreshing by comparison. Here is Red Ken on some of the challenges facing the world today:

“All the politics of the post-war period was about the clash between the Soviet Union and America, and virtually all issues ended up being subordinated to that,” he says, “Now, the question is, what is the most a socialist can achieve in a global economy? What do we do about climate change bearing down upon us?

“In a sense, it brings us back to the basic socialist tenets. The only way you get through this is by sharing and planning, resource redistribution, allocating priorities – the market isn’t going to get us out of this. The market is a brilliant system for the exchange of goods and services, but it doesn’t protect the environment unless it’s regulated, it doesn’t train your workforce unless it’s regulated, and it doesn’t give you the long-term investment you want.”

Livingstone goes on to heap praise on Hugo Chavez, which is probably unfortunate. However, his beautifully succinct statement above, which summarises some of the limitations of markets with respect to some of the major problems facing the world today, is unequivocally, undeniably true, regardless of if you think Karl Marx was an economic Satan or not. It is true that Livingstone is portrayed in the media as a stereotypical leftist (and he certainly does his part to perpetuate that perception), in a way that perhaps Prime Minister Gordon Brown and Prime Minister Kevin Rudd are not. However, one does somewhat wish that the leaders of centre-left parties like the Labor and Labour Parties would use reality as a device for crushing at least part of the stigma associated with the s-word.

Socialism as a body of thought is not in any sense equivalent to communism. The vast majority of people who refer to socialism in positive terms today do so out of deference to the humanistic and compassionate qualities of the ideology, not to the horrific calamities instigated in its name. Stripping away the irrational bonds of the taboo enforced by some intellectuals about this peculiarly modern dirty word, the truth of the matter is that we are all socialists now, at least to some extent. The “sharing and planning” that Livingstone speaks of is a basic, critical human activity that is inextricably embedded within the infrastructure of modern human society, and if compassionate and effective civilisation remains a desirable goal for the human race, we should hope it long remains there.

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