When Malcolm Turnbull became prime minister after deposing Tony Abbott, you knew free- market capitalism had run its race in Australia. In place of the reformist Abbott, was a Liberal in name only, advocating ‘consensus and co-operation’ as the keys to economic growth. No talk from him of smaller government, fiscal responsibility and a more competitive, less-regulated marketplace.
Today, 14 September 2015 can be seen as an ideological inflection point in Australia’s social and economic development. Those 54 members of the parliamentary Liberal party who decided to dump Tony Abbott for Malcolm Turnbull let a socialist genie out of the bottle which refuses to go back.
So detached were Turnbull’s backers from the Liberal party’s traditional values that they voted for a man known for his disloyalty, who regularly demonstrated his socialist instincts and had a record of uncannily-poor judgement. But blind ambition and an amateurish reading of opinion polls quashed all other considerations.
Future generations of Australians will pay a high price for this exercise in conceit. It has left them with bigger government, too much debt, a naive belief in globalism and a country divided by victimhood and identity. What’s more, thanks to capricious leadership, they inherit a less confident society, unsure of its legitimacy, its achievements and its freedoms.
The Turnbull years also left the country more open to shocks. As former New South Wales premier and Australian foreign minister, Bob Carr noted in an op-ed in the Australian, ‘The diminished band of small-government advocates now face fiscal commitments bigger than any made outside war… with no exit strategy’.
As a committed socialist, Mr Carr celebrates this predicament. Indeed he goads, ‘If capitalism is so good, why does it need socialism to save it every decade?’. It’s a cute question but based on a false premise. It’s not free-market capitalism being saved, but crony socialism predictably crumbling under its own distortions and waste.
Indeed, Mr Carr is misguided in demeaning the scholarship of Friedrich Hayek, Milton Friedman and Ayn Rand when he argues its only value is as a ‘substitute for the discus throw at the Olympics’. ‘Has any earlier time witnessed such an overnight junking of ideology?’, he sneers. Well, yes, if you consider the Nazis ordering the immediate burning of all books considered subversive.
In consigning Road to Serfdom to the discus throw, Mr Carr appears to dismiss Hayek’s warning that ‘in our endeavour consciously to shape our future in accordance with high ideals, we… unwittingly produce the very opposite of what we have been striving for’. The fear that ‘We shall never prevent the abuse of power if we are not prepared to limit power…’ seems not to bother him.
Sebastian Haffner, a pre-war German journalist, knew all about abuse of power. He anguished over what Mr Carr, Mr Turnbull and other left-wing intellectuals now celebrate. Haffner despaired at the meek surrender of so-called conservatives. If he were alive today, he would be similarly struck that ‘There was not a single example of energetic defence, of courage or principle’.
Australia’s response to the coronavirus pandemic illustrates it’s later than we think. Rather than issue guidelines promoting personal hygiene and sensible distancing and concentrating on older populations and hospitals, compulsion was the first resort. Never before has government forced such a widespread shutdown of nonessential activities. We may congratulate ourselves for putting aside ideology and embracing bipartisanship, but the Covid-19 reaction demonstrates our political ruling class is as one when given the chance to remove personal freedoms. Bob Carr is right. ‘The state grows during crisis and, never retreats’.
Governments defend their actions by citing medical advice. But we know from the positions taken by the Australian Medical Association, medicine has authoritarian biases and is often dismissive of democratic processes. Indeed, rather than being scientific, some of the modelling now relied upon by governments has been exposed as simply alarmist propaganda.
Surely, when the risk to the vast majority of under sixties who lack co-morbidities is minor illness or no illness at all, the vulnerable have to take personal responsibility for self-isolation and other precautions. But no, governments persist with lockdowns and dictatorial enforcement, exacting an unconscionable price on the young and future generations. Even token easing compounds long tail risks.
There will be no ‘V-shaped’ recovery. Private balance sheets were not prepared for this pandemic, so financial repair, not spending, will be the focus. People have been so conditioned by fear that for them, business as usual, at home and in the workplace, is a long way off.
On the other hand, having caused the impending economic catastrophe, over-leveraged governments will continue to flood the economy with fiscal and monetary largesse, selling the message that only government has the key to our financial salvation and economic prosperity.
And for the unemployed and the financially distressed it will not have escaped notice that, despite the calamity around them, public employees remain secure on full pay. It is a great advertisement for state ownership. What’s not to like?
Like it or not, from now on, government will have a much greater place in our lives. Higher marginal tax rates, death duties and capital gains taxes on primary dwellings are in our future. Cheaper energy and a more competitive labour market mean renewable energy subsidies will be phased out along with the scrapping of some penalty rates. As the adage goes, ‘Any government big enough to give you what you want is strong enough to take everything you have’.
Milton Friedman believed that ‘the actions that are taken depend on the ideas that are lying around’. As Bob Carr observes and, as our parliaments and academies have ensured, few ideas advocating free-market capitalism are heard today.
Vladimir Lenin was right. ‘Nothing can happen for decades, and then decades can happen in weeks’.
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