A critical role for the Evatt Foundation

Sally McManus

I would like to acknowledge the traditional owners of the land on which we meet and their elders, past, present and future.

When Bob Hawke addressed the 10th Anniversary of the Evatt Foundation in 1989 he rightly praised Doc Evatt as a great man who made a remarkable contribution to the Labor war and postwar governments, the Light on the Hill era of Labor. Bob, as Prime Minister, spoke here of the changing nature of the world as the Berlin wall was falling, in detail of the need for progressive tax reform and of an Australia where everyone is able to feel secure and enjoy our shared prosperity. Bob was critical of the conservative side of politics for its failure to see the role of government in the distribution of prosperity. Bob knew that government could achieve a more equitable distribution of prosperity by means of reforming the tax system, so that there was no more special treatment for those living off accumulated capital over those who were working for a living, and by means of a social security system that sought to help, rather than punish.

Thirty years later the underlying divide is still between a free market ideology that says corporations and powerful individuals will act in their interest and prosperity will trickle down to the rest of us, and a social democracy that seeks to limit the depths of poverty into which working people can fall, as a result of decisions made by billionaires and corporate executives, while sharing the prosperity of good times.

In 1989 Bob spoke of the need for reforms in industrial relations that would allow all working Australians to participate in and enjoy the benefits of a productive economic model with fair pay rises and outcomes based on facts rather than ideology. Of aiming for a society that did not allow, what he called ‘industrial warfare where the weak are crushed and the strong get the spoils.’ At the time, this not only referred to big companies squeezing workers but also to industries where unions were able to make wage demands that were disconnected from productivity. It was a speech made in the shadow of the inflation of the 1970s and a rampant boom-bust economic cycle.

The world is a very different place to when Bob gave this speech. It was a time of big ideas and of big political contests. Reforms were argued for and major changes were delivered to the Australian economy; changes that would end the boom-bust approach to economic policy-making, and that set Australia up with an economic system that sought to smooth out the chasms, and some of the peaks, to deliver widespread prosperity.

These reforms could only come about because of the nature of the Australian economy and workforce at the time — nearly 60 per cent union membership, a more closed economy, large workplaces and a manufacturing base. Most of all, we had a centralised wage-fixing system. Literally, two men could come to an agreement and then roll that agreement out across the whole economy — annual pay rises, Medicare, superannuation. Of course, it wasn’t quite that simple, but it was almost that simple. Bill Kelty has recounted to me negotiations around achieving universal superannuation that occurred in an Indian Restaurant in Melbourne between him and Paul Keating. The deal was reached over curry and on napkins. Of course, individual leaders needed the authority to deliver the deal, but the structure of our wages system made this entirely possible, and although the intellectual persuasion that needed to occur was not always easy, the mechanism was.

Compare this to today. We have a wages crisis. The Reserve Bank Governor urges workers to demand pay rises of no less than 3 per cent, the budget papers are banking on wages going up by 3.25 per cent, the whole economy is slowing to a stand-still because wages have flat-lined. Tax cuts for big business have not trickled down, nor have profits. Growth in productivity is not reflected in wage outcomes. Now we have a problem where the current framework of laws for wage negotiations is incapable of responding to this crisis. Indeed, the laws themselves are a large part of the reason we have record low wage growth. Laws need to be changed by governments, but when you have governments so ideologically committed to trickledown economics, so committed to neoliberalism and so on the side of big business, they will not change the laws to fix the problem because it is a problem they have created.

And this continues to feed the sore that grows and festers at the heart of our democracy: the belief now shared by many people and too many voters, that governments not only won’t, but can’t actually do anything to fix the problems in their lives. Gone are the days of most people feeling connected to the ‘big picture’ and where political leaders argue for change and for new ideas. The political risk is not so much the 24-hour news cycle, because discipline and persistence can still counteract this, but that there are fewer people who listen or care about ‘politics’, let alone listen to news regularly.

Australia, like other western democracies, is seeing the growth of people who are disconnected from politics. According to the Sydney Morning Herald and The Age, one and a half million Australians who were enrolled to vote didn’t do so at the last election. In some seats, fewer than three-quarters of those entitled to vote cast a legitimate ballot. And according to a Pew Research Centre study, when presented with articles that contain fact, opinion and a mix of both, only one in four Americans can identify the articles that are purely factual and roughly a third can identify those that are purely opinion-based.

So, even if the debate about a policy idea is won with those who do engage or engage intermittently, we cannot assume this will be enough. The best ideas can be overwhelmed by campaigns that solely target the disconnected, the cynical and the disillusioned. Some, but not all, of this cohort are also much more susceptible to fear or scare campaigns. They are less able to dismiss fear campaigns because they have not had repeated exposure to the facts on the issue; opinion, fact and falsehood are often cleverly blurred to hide what is true and what is not, and they have little time or interest in picking through falsehood, fact and opinion to begin with.

In elections where the number one issue is the struggle to keep up with the cost of living, scare campaigns suggesting voting a certain way will make this problem worse engage this disconnected group of voters in making a risk adverse decision. If you are already struggling to pay the bills, the suggestion that voting one way would give you an instant $1080 tax cut, or that one guy is going to tax you more, or that you can’t trust him not to make your bills go up, is very effective. Many voters only pay attention to an election at the last moment, at the point they realise they will have to vote soon. What did these voters see and hear? The last two weeks of the federal election was a sea of yellow anti-Labor, anti-Bill Shorten advertisements targeted specifically at these disconnected late-deciding people, all suggesting that you cannot trust a politician and that your bills will go up. The spending of Clive Palmer in the final two weeks of the election dwarfed the major parties. It’s a bit like being at a party with ABBA blaring out of loud speakers. People were at the party talking about other issues but all anyone could hear was ‘Dancing Queen’. All anyone remembers about the party is ‘Dancing Queen’, and they couldn’t really understand what Dave was yelling about all night.

This is the logical conclusion of neoliberalism. For 30 years we have been told that markets run the economy and that everything happens by a set of laws determined by an invisible hand which exists outside the control of any individual or government. The job of good government is to get out of the way and limit restrictions on the market to the most basic requirements of law and order. Implicitly and explicitly, this is a view that governments are bad, and when they act it is often maliciously — to ‘impose’ taxes or to take something from you. No wonder people are more susceptible to scare campaigns and no wonder some people will think ‘it doesn’t matter who gets elected, so I may as well vote for Palmer or Hanson, Trump or Johnson. At least clowns will entertain us, and if they get up the elites — even if they are part of them — now and again, even better.’

This is also fertile ground for extremism. If enough people start believing that democracy is useless and voting makes no difference to their lives, anger will grow at politicians who seem remote, elitist and self-serving. People will question the value of our democratic system. If the solution to inequality cannot be brought about by electing politicians, if choosing which group of politicians run the country doesn’t change wages or make jobs more secure, what is the point of participating in the process of choosing them?

These are dangerous times for the future of not just our country but many others who are also suffering the logical conclusion of neoliberalism. For it is neoliberalism that has super-charged the growth in inequality around the world. This has produced a billionaire class that has the means to manipulate elections. This is part of what we saw in May in Australia. Clive Palmer’s $80 million is small change to him. It was a small investment or gamble, with the chance of big returns. The same with Donald Trump. Some in this billionaire class can purchase the means to manipulate and target messages to those they need to reach to win elections. In the case of Trump and Palmer, it is the disillusioned and the switched off.

You see, money can buy the best that new outfits like Cambridge Analytica — and the proliferation of faceless similar companies — can offer. Anyone who has watched the documentary The Great Hack will understand what I am saying. Our digital identities, our likes and fears, our financial status, our marriage status are all there to purchase. Did you know that the big banks in our country know 300 things about each and every one of you? Your debt levels, your purchases, your home ownership. They can sell this data if they ‘de-identify’ and ‘aggregate’ it; essentially, they remove your name, then by using data analytics your data can be included in a target segment, that’s you and people like you, and then messages are tested until the company, or billionaire political aspirant, knows exactly what you like, what you are afraid of, what motivates you, what demotivates you and how to make the most of that information for their purpose. And you will never know.

This provides a means of influencing elections way beyond TV ads. Like other democracies around the world, we are seeing this deployed in our elections. 2019 was the first time it was obviously deployed. Targeted messages circulated via Facebook messenger saying the ‘Labor, Greens and the unions have done a deal to introduce a death tax’; targeted messages circulated to renters about their rent going up because of negative gearing changes; targeted messages to people who own multiple properties telling them the same changes would see them have to sell their investment property or lose money. The same policy, but groups in opposite positions to be impacted; the same fears, the same core negative message. Outcome? According to a study by the Australian National University, renters who would have benefited from the policy by being more able to buy their home did not vote for Labor. Owners of a home and one negatively geared investment property, who have kids, swung against Labor.

It appears a pattern is emerging as all the data is put through regression models and those who swung against Labor were more likely to be low income, low education voters who are more disconnected from politics and had not made up their minds until the end. Perhaps there is a correlation between all these things: sisconnection and disillusion from politics fed by neoliberalism; billionaires using their means to drown out everyone else so there is only one thing these people hear; the use of data analytics to target these same people with messages designed to make them pay attention, even if the messages are entire lies, as there is nothing that can be done about lies in the unregulated world of much of social media.

If what I have said has some truth to it, what does that mean we should do? There is a very strong case for limits on election spending so billionaires cannot buy disproportionate influence. I am conscious I’m saying this here in New South Wales where Liberal governments have brought in spending caps. But these spending caps affect collective organisations disproportionately; individuals who choose to organise in order to have any influence at all. Of course, citizens organising is part of any healthy democracy. But in the case of Clive Palmer, this is one person, not hundreds of thousands of people. One person having way beyond the influence any other one person, and often whole collectives of people, purely because of his wealth. This is wrong. If there is not law reform, this will happen again. After all, the number of billionaires in Australia grew by 24 per cent in the last 12 months. And their combined wealth grew by $160 billion. It’s not just Gina and Clive, its many others whose interests are served by protecting the status quo by whatever means necessary. Since the election, Twiggy Forrest received a $1.24 billion dividend from his mining interests. Anthony Pratt, who recently hosted Scott Morrison and Donald Trump at his new Ohio facility in the United States, received revenues of $6.9 billion last year.

Secondly, there is a critical role for the Evatt Foundation to uphold the values of the broader labour movement. We must muscularly assert the role of governments in making lives better for working people. As the wages crisis shows us, when governments choose to abandon their place at the levers that can be used to balance the bargaining power of workers and employers in an era of growing equality, wages flatline. Governments are there to support their people, to stand up and limit the power of the few, not let them have free reign to trample all over us. The world is not equal or fair. Governments can, and must, act to make it more equal and fairer. This means challenging the central tenants of neoliberalism, debunking them.

We can see the failures of privatisation, the price gouging, the loss of services to communities. We can see whole communities left behind and destroyed by changing technology and climate change where government has left decisions to corporations and the newly unemployed to the ‘invisible hand of the market’. We can see that companies will engage in wage theft if it is easy to get away with, and if it is cheaper to get out of trouble for stealing wages than it is to get the stolen wages paid to you. We see that companies will casualise jobs if laws do not create a framework for defining what is a casual job and what is ongoing. We know that companies will not pay tax if we let them get away with it, and the banks will literally rob from the dead when they self-regulate.

This means calling out wealth and power inequalities and demonstrating that something can be done about it by good governments acting in the interests of the people. These are not things that can be ignored or brushed over. If people like us do not step up and argue that things can be better and that positive change can happen and clearly point out who is to blame for low wages and an insecure future, people will lose faith in democracy, look for alternative people to blame, and continue to be susceptible to cynical billionaire politics and scare campaigns.

Thirty years ago Bob Hawke spoke here and addressed the fundamental divide between his Labor government and the conservative forces of neoliberalism. While Bob might not have foreseen the rise of social media and the corrosive impact that its abuse by billionaires can have on our public debate, he knew how important it was for government, and our political movements, to keep engaging with people’s hopes and to reassure their fears.

Thirty years after Bob first told you what we need to do, let me remind us all:

The decisions we make today will profoundly affect the life those future Australians lead. If we open the doors of opportunity now to women, to new migrants, to those who lack the privileges of wealth, we will be helping those immediate beneficiaries but, just as importantly, we will be creating a society that is enduringly fair and open. But if we slam shut the door of opportunity, if we aspire to turn the immigration clock back to the attitudes of our unacceptable past, we'll be committing not just a morally repugnant act but an economically insane one. In the same way … Labor practices ecologically sustainable development so as to bequeath to our children a rich natural heritage, the conservatives explicitly pledge economy with virtually no regard for ecology.

None of what needs to be done will be easy. The economy, the progressive nature of our tax system that supports our social security, our democracy and our very planet are all under threat from an ideological opponent who has wealth, is in power and has no compunction in misleading people.

But as Bob told us 30 years ago: ‘The decisions we make today will profoundly affect the life those future Australians lead.’

The Australian union movement is not prepared to accept a future life for Australians where the living standards of working people, whether in work, looking for work or no longer able to work, are in decline; where the wealthiest keep getting wealthier; where only billionaires are in politics; and where our planet has become too hot to sustain human life.

So, the struggle continues.


Sally McManus is the Secretary of the Australian Council of Trade Unions. This is the text of her speech upon the 40th anniversary of the Evatt Foundation at NSW Parliament House on 27 September 2019. Photographs by Sarah May.