|Issue No 108||24 August 2001|
2.4 The Skepticís Response
In this round-table discussion, Noel Hester leads the charge against the argument that globalisation and change are inevitable.
Noel: All of these things you are saying are classic neo-liberal arguments that have been put forward for the last 10 or 15 years about what needs to be done. There needs to be more competition. We need to break up the monopolies. We need to privatise. Blah, blah, blah. It hasn't delivered a better outcome for most people though. It's delivered a good outcome for a lot of businesses and people who have got a stake in there, but it hasn't delivered a good outcome for workers. It's increased insecurity; there's lower real wages; there is all those issues that we have been talking about right through, and I am extremely cynical and skeptical about all those things. They have not delivered in the way that has been promised. All those things have been put in place and maybe BHP did have its problems and maybe Smorgens has become more competitive - you can put all that anecdotal evidence forward but what does the big picture tell us?
Sean: I think that the fundamental problem in that model is that security has been placed in the enterprise, not in community structures.
Noel: What has happened has been a complete abandonment of responsibility by government and by the democratic processes that are meant to be there. That whole free market approach means there has been power translated both in an economic and political sense, out to people who do not have the interests of workers at heart.
Sean: I would agree with you on a commercial basis, and I would agree that's what has ended up happening in government. I don't think that, per se, means that for the future we decide that we are not going to change, because I would have to say that my view is that there is not really a choice for us. I think the choice for us, is how can we make the change work for us better, and I agree that there is a lot of work, we can do this better. Now fundamentally, I think our sense of security has to be vested in our community infrastructures, not in individual enterprise, and that's why I think things like long service leave being a superannuation entitlement, rather than being invested in a company that might go broke, is really important.
Michael: Noel, I just want to pick up on your point where you said that it's no different to the neo-liberalist argument. It's a really valid criticism. It's one that's going to come up, so it might be worth expanding a bit..
Noel: It's a slavishness to a new orthodoxy and it's not actually paying the results that we've been promised. And it's so important to stop and say at a macro level - this ain't working. Go down to a micro level and say, yeah, you need to be more competitive, or this enterprise is doing much, much better. But if you look at the over all results in that general approach, is it working for most workers? And the thing that is really disturbing is that there is a complete abandonment of responsibility by the political process.
Michael: If it is different from the neo-liberalists, why is it different? I think the commonality between your argument and neo-liberalist argument is where we are going. What's happening. Globalisation. Internationalism. Both we, and the neo-liberalists are saying that's where we are heading. I guess the real difference between what Sean has put forward and what the neo-liberalists argue is how that transition is managed. It's the social contract that underpins that transition, rather than the transition itself. If the transition is inevitable and I suppose we can debate the inevitability or otherwise of it, then ....
Noel: Well, the word "inevitability" is something that scares me about the whole of this debate. It is that it is allowed to carry on no matter what the consequences are, because everyone thinks it's inevitable.
Michael: Or there's the other way of going, and saying "it is inevitable", it's going to happen, let's not ignore it anymore, let's face up to it and if that's going to be the case, how do we make it acceptable?
Noel: Well let's at least have a genuine debate about it. What really scares me when you have these sort of debates, there is an incredible repression about challenging it. You are a dinosaur - you're an old Marxist - if you challenge these new shibboleths of the neo-liberal age. I just think if you say I oppose the break up, the privatisation of Telstra or whatever, people come back with these arguments about well, it's inevitable, this is the way globalisation is going. All it just leads to is an incredibly sterile debate that is actually in favour of those trends that make it inevitable.
Michael: The problem is the debates on the Left have been quite sterile.
Noel: It's not a question of being on the Left.
Michael: My problem is that I think that there has been a crisis in progressive politics in dealing with the information age, because I think the neo-liberalists were very well placed for the emerging age of global capital, and I think probably the progressive side of politics was very badly placed. What we want to try and do with this book is to try and reclaim that agenda, but by doing so I think what we have to do is to give some intellectual rigour to the left/progressive side of politics. But to do that we have to acknowledge where the neo-libertarians were right and accurately state where they were wrong. And I think they were absolutely wrong in the way they wanted to manage the transition, which was f... you, you've lost your job, it's going offshore, and that has led to the breakdown of the social contract and the emergence of One Nation, Pauline Hanson's movement, the crisis in government that we've got at the moment.
Noel: Yes I agree with those things you have just said, but there are other things as well. There is still a persistence of elements of power from the past that still go into the present. It's true that there is a change in the nature of work and in the nature of the workplace, but power hasn't changed that much. If you look at those realities for workers - that their real wages have gone down and their insecurities are there - Why is that? There are power relationships involved in all those changes - not just technical changes.
Sean: But I have to say Noel that the stats would say that overall wealth has gone up. The real problem is distribution of wealth in this country. And that's an important stat because in a sense these neo-liberal changes have delivered something, which is an increase in total social wealth, but the way it's been implemented has ended up being a much greater concentration of that wealth. What I'm concerned about is getting the best of both worlds.
Michael: People who have slipped into the information age have done very well, it's the people still locked in the industrial age that have actually not done well at all.
Sean: I genuinely believe it's possible to continue and to increase the total wealth - putting aside the issue of environmental sustainability which is a concern of mine separately. But I don't think that's necessarily exclusive to this issue - whilst also ensuring a reasonable and much fairer distribution of that wealth. And that is for me what the problem is about. Not that the changes haven't delivered wealth, but rather we have done them in a way that has marginalised a whole group of people and marginalised further a whole group of people who are already marginalised.
Michael: Particularly in certain regions, the unemployed, and those that are locked into the Tayloristic industrial age.
Noel: But the other issue is, was there another alternative in the way that that done. It was always the neo-liberal argument from the beginning. We've got a crisis and there is no other alternative except to do it this way - and that is a point that is very thinly debated.
Sean: I have to say, Noel, the proof of the pudding is the difference between the New Zealand economy and the Australian economy. Which is a relative difference, because the Australian economy is still pretty neo-liberal but not as neo-liberal as the New Zealand economy was and the end result was the NZ economy went right down the OECD ladder consistently right through ......
Noel: And is now struggling to try and get back there.
Michael: Because they didn't manage their transition properly.
Noel: And they also didn't deliver. That neo-liberal agenda in its purest form - which is what it was - you wouldn't have got it in a purer form in the Western world than what you got in New Zealand - didn't deliver. Their economy shrunk for about the first seven or eight years of that experiment and they slid down the OECD ladder.
Michael: There's two debates. The transition itself: Is it worth making? And is there another way of doing it?
Sean: I suppose I'm putting a case to you that I still think yes the transition and the transitions are in fact essential and I think the internet age is only going to heighten that transition.
The critical issue for us becomes how to work towards a fairer distribution of that wealth. That fair distribution is in two places. One is within countries like ours but it's also internationally. In other words, its globally as well. It's a concern to me for example, that at the moment I think Africa is the continent that's going to be slowest to be able to take up this revolution. And I don't think, by the way, that it is very hard to do something about that. Especially, with some of the technological advances and you will find that a whole lot of people in silicon valley who were quite keen on the idea of helping Africa take a leap beyond the industrial age because our wealth really is linked to theirs anyway in the long run. The basic principle behind this which I have to say I do subscribe to now, is that there is a kind of a mentor about creating wealth.
Michael: As opposed to economic nationalism, mercantilism. The failure of Japan's economy is the ultimate proof that mercantilism didn't work, that economic nationalism is a complete failure, that wealth is a collective thing. Wealth is created by spreading it around and the more evenly we can distribute wealth the greater that wealth can be for everyone.
Sean: Well, the big change though in economics in the last few years - which not everyone accepts - is that you are not dealing with finite resources. Wealth isn't a finite thing. But in fact, it's a product of imagination.
Michael: It's particularly easy now to see when the real value added is the imagination anyway. It was harder to see when what was primarily being traded were goods and commodities whereas now what is being traded is primarily services. It's easy to see that there is no limit to those resources.
Noel: You said you can't argue with the fact the proof of the pudding has been an increase in wealth. There has been a growth figure. But the argument for me there is to have an analysis of why is that so. Is it because of all those changes that have been made - like increased competition or whatever, or have they just leveraged on the technology changes that have come about. Could those technological changes have led to an increase of wealth being harnessed in a different way? Or could you actually have done it - for me it's not just a left perspective - but just this idea about privatisation and things like that. These have always been mechanisms of how you redistribute wealth. By having a reasonable state sector involvement in the economy and having a public service and a strong involvement in the economy and having a good union movement, have been two of the big ways that you have redistributed wealth. That's the debate that you have to address without in some way being pejorative and saying 'that's a dinosaur argument'. Was there another way, where you could have held on to those redistributed mechanisms but still leveraged the technological changes that in to increase the wealth? I think it's a pretty unexplored sort of line thought.
Michael: Or do you need to review the risk of the mechanisms themselves? Are you going to say, this is how we spread wealth around in the past. And let's face it, the industrial age didn't actually spread wealth around very well at all. In fact it tended to coagulate wealth into the capital class and you tended to have this under class...
Sean: That's not strictly speaking correct because there's a pretty massive bourgeois class in the western world now - middle class - and that in fact is an outcome of the distribution of wealth. I think the debate is not that it hasn't been distributed, but rather could it have been done sooner or something like that.
Michael: I think you can say that in the industrial age wealth didn't tend to flow down to the bottom very well at all. OK you had a growing middle class, but you had a third of the population in the middle class and basically two-thirds of the population who were an under class, who were the working class.
Sean: ... in the early stages of the industrial revolution. Which is going to happen with the information revolution too unfortunately. This is what we have got to fight against. The only thing it will be in a shorter period. But I think you also have to say that in the latter part of the industrial revolution in western countries it became a two-thirds: thirds. Someone earning $50,000 or $40,000 a year now is in material terms earning a lot more than their father earned 20 or 30 years ago. In terms of purchasing power and in terms of relative wealth, a lot more. And the per capita income in western countries is far, far higher, even taking into account quality of life issues, than it was a generation ago.
Michael: And a range of basic things like food and basic lifestyle products are cheaper.
Sean: A wide range of things. Now, why it is useful to think about this in terms of the next age which we are entering into? It is because the real value, the real change to that wealth has come from different kinds of applications and imagination. Now, the application and imagination initially was reorganising forms of work - like Henry Ford, Taylorists treating people as pieces in a game.
Michael: Like a machine.
Sean: Although I must say, remember that Henry Ford actually guaranteed his staff a good wage. So, we've got to remember that about Ford.
Michael: He had to compensate that they had a boring job.
Noel: No. He put purchasing power in their pockets.
Sean: He had a view which he had to pay people so they could buy his cars. It was an economic view. A damn good idea.
Micahel: But that was at the start of the Industrial Age.
Sean: No. We are talking about 1906. This is 100 years into the industrial age. This is the beginning of the mature phase. What I'm saying is that the wealth that we've got has been added by imagination. A lot of that wealth has been generated from individual products. Like the usage of cars, putting aside the environmental disaster they have been. But the usage of your crops. People's ability to live off their own products. The spread of that sort of wealth.
Now in the new age you are going to get a lot more of that because: (a) there's a bigger market, and (b) there's a lot more tools available to individuals to apply their own imagination. If that works well it could mean an exponential growth in wealth, if you accept the theory that wealth flows from the successful application of the technology.
Michael: That really then goes to the whole theory of individualism. Because where you've got people all locked together in step - and I guess in the traditional industrial age the collectivist model is... people were very treated similarly and there was an enormous sense of collectiveness across the workplace. People did the same job in the same way.
Sean: Which is a temporary hiatus to history, which lasted 150 to 200 years. Prior to that people were crafts people.
Michael: In the information age people are going to go back to having an individual job. People are all going to do things their own way.
Sean: That's right. We are going to become intellectual craftspersons.
Michael: So they are going to become in one sense more individualistic. Because they are doing work differently, they are leading their lives differently. They've got a car rather than public transport.
Sean: They can choose to work at home, work at the office, do a range of things.
Michael: And because they are more unique, they are more of an individual, then they are more likely to come up with a unique idea. And so their imagination grows. But does that necessarily mean that they lose their sense of collectivism? Do they still have collective needs?
Noel: I'd question this idea that brilliant ideas come from individuals. I think they come from groups. They come from teamwork. People spark off each other and an idea grows.
Michael: I think they are coming from individuals synergising.
Noel: People come together and you get more of a brainstorm than you do on your own.
Michael: That's true, but if you have got a unique group of people who all live different kinds of lives and come from different cultures and backgrounds, then you are going to get much more interesting ideas than you are than if you take a bunch of people who all do the same thing.
Noel: There's merit in that. The value of diversity.
Michael: But diversity is increasing. People are becoming more unique, but I don't necessarily accept that statement that individualism is growing, because I still think that people have enormous collective needs. OK our lives are all changing. This is why industrial awards don't work as well as they used to. Awards worked really well in an age when everyone had a very similar kind of job. You neatly fitted into that Clerk Grade 3. You had the same kind of job and the same kind of work patterns. You worked 9 to 5.
In the information age everyone is going to have their own unique pattern of work; their own way of doing things. It will suit them, so you can't lock everyone into that one-size-fits-all industrial age model. But that doesn't mean they don't still have collective needs. In fact, maybe my collective needs which were met because I could identify with every other Clerk Grade 3 in the world. That was a collective need that was met in that way. I have got to find a much more imaginative and different ways of meeting that collective need. Which means I still think in a world full of individuals, you still need unions, but the unions role has to change. They have to recognise and allow for the individual.
I think unions at the moment risk repressing the capacity for individual expression. I think at the moment some unions want to retain people, lock everyone into being a Clerk Grade 3, and what unions have to do is change their whole mindset. They have to allow that to say, we don't want you to be a Clerk Grade 3, we want you be able to express yourself individually. But at the moment I think there is a tendency in unions to try and stop that ...
Noel: It is not just unions. It is the whole of the left wing thought.
Sean: And a lot of right wing thought. Institutional thought.
Michael: Let's say conservative thought.
Sean: Of left and right. That's true - that's institutional thinking.
Michael: The old left and the old right I think are the same. I see them both as conservative. There is a new mode of progressives that maybe come from elements of the old right - maybe are progressive nowadays.
And I think maybe the fact that Sean is in this room, contributing to this book - and he's an employer - he's a boss - he's on the other side of the fence. I think you can find conservatives in the old left and the old right, and I think you can find progressives in the old left and the old right too. I think there's a re-shaping of the political paradigm.
Noel: Coming from the Left I definitely accept that there is a kernel of truth in a whole lot of things that the Right have been coming out with. I am a very severe critic of the neo-liberal agenda and there are lots of areas where people call me a dinosaur, but I always listen to what the Right say, because what they do, is quite cleverly identify the kernel of dissatisfaction that there is out there within society and in the workplace and then hijack it for their own agenda.
Michael: Exactly. And what we have to do is we have to find out where they are right and accept that they are right and then work out where they are wrong and nail them all.
Noel: They identify the dissatisfaction really well. It's the agenda they use it for. So we have got to go back and concede that there is dissatisfaction there - and it is quite often with us. It is quite often with the union or a political party or whatever. And we have to deal with it.
This is a transcript of a discussion involving the ACTU's Noel Hester, Social Change Online's director Sean Kidney and Labor Council's Michael Gadiel
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