CV19 Will there be Bacon
When Keating delivered the budget in 1988 he declared that ‘this is the one that brings home the bacon’. It was a reference to the anticipated dividends the country could expect after enduring the pain caused by the tight budgets and economic restructuring over the previous 5 years. Unfortunately for Keating, the hard times continued a bit longer, but the bacon eventually arrived in the form of an unprecedented growth in living standards of the average Australian as the increasing productivity of the Australian economy delivered sustained increases in real wages.
During this time Keating was lampooned by cartoonists by picturing him making sacrifices at the base of a pedestal, and atop the pedestal were ‘The Markets’. This was due to Keating’s continued reference to, and what some saw as paying homage to, ‘The Markets’, because while Keating famously pulled the levers to manage the economy he was acutely aware that the judgement of The Markets was influential in determining the success of the reforms then underway.
In spite of Keating’s perceived homage to The Markets he understood implicitly that society was not subservient to the economy or the markets, but instead that they were there to serve society, and that the purpose of his reforms were to deliver benefits, the bacon as he called it, to people.
Fast forward 30yrs from Keating’s speech to a speech from our current Prime Minister, in reply to Greta Thunberg, at the United Nations, where he felt very comfortable saying “let me remind you, we live in an economy”. In his mind we have moved from living in a ‘society’ to living in an ‘economy’.
Morrisons’ comment demonstrates that before the Covid-19 pandemic The Economy was considered to be it’s own entity, separate from and at least equal to the society with which it co-exists; or perhaps in the mind of Morrison, dominates.
‘The Economy’ itself has now become what’s important, rather than the people who live within the economy. The implication of this shift is that governments now appear to pursue policies purely for the sake of ‘The Economy’, instead of for the ultimate benefit of people. The headline numbers that define the economy, GDP growth, government debt, etc matter more than the lived experience of people. By this I mean that policies may achieve a ‘good set of numbers’, be they GDP, or inflation, but leave each of us worse off.
What does all this mean? There’s no more bacon to be had for you and me.
The impact of this shift, in the position of the economy, is that politics has become a contest between The Economy, and people; Australia vs Australians.
In the political battle between the Liberal and Labor parties, the economy has become weaponised. The Liberal party ‘own’ The Economy and use it to attack anyone who challenges their policies that will benefit it, to the extent that any attempted discussion on issues related to the welfare of people are met with replies such as “but what will it mean for ‘The Economy’.”
The result of the weaponisation of the economy is that the relationship between a strong economy and a healthy society no longer exists. For example, the ‘gig economy’, is cherished for the flexibility it provides employers, while its impact of underemployment and dislocation of people is ignored.
What has happened is they have taken an abstract concept of the overall system of interactions that describe the manner in which we work and exchange goods and services and treat that concept as a god that must be obeyed and worshiped and then eventually a weapon to use against people. But the economic view is merely one perspective for viewing our lives. While it describes our outputs and interactions, discussions on the economy cannot be and should not be separated from discussions about us and our lives.
For example, it is not uncommon to hear of people cutting back on their income through a change of jobs for ‘lifestyle reasons’. Some people may stop working overtime to be able to spend more time at home, they may shift to part time, they may quit work altogether to take a long sabbatical. In each case they have consciously reduced their income to focus on other parts of their lives. While of course most people will always want more money, many people have deliberately decided to trade money for a richer life.
Yet this is a conversation that we are unable to have as a group, in aggregate, as a society. There can be no discussion about the trade-offs between higher national income and the shape of our society because The Economy is master over all. Why is it that the decisions that many people make for themselves are not reflected at a higher level?
I hear you say, ‘but it would not be right for politicians to make decisions like this about our lives, they should not be able to consciously reduce our income to achieve other goals’. But this is what politicians do. They make decisions about how we will live our lives, how hard we will work and what will we work for.
I am not suggesting that we should all be forced to give up work, or to only be able to work part time, because for all the people that are cutting back their hours there are just as many seeking to increase theirs. But that’s the point, at the individual level, there is a mix between lifestyle seekers and money chasers, yet at the national level that mix is not allowed to exist – ‘The Economy’ forbids it.
In the early days of the spread of Covid-19, when there was still debate about what was unfolding; whether we were facing a pandemic and if so the extent of any restrictions that should be imposed, Prime Minister Morrison during a press conference on the coronavirus was at pains to remind people that “there is this thing called the economy, and we can’t ignore it”.
His comments laid bare the dichotomy that exists in his mind between ‘The Economy’ and society. In his mind a balance needed to be struck between two separate and competing sets of activities; between our standard of living in financial terms and our quality of life, indeed for many, life itself. A deeper understanding of what the economy is, and what it represents, would have seen a different discussion of the trade-off Australia faced at that point.
We are all at various times faced with decisions about pursuing income versus other objectives – our lives are driven by more than just financial goals. This is the decision that Australia faced in February. It is in fact, the decision politicians are faced with all the time. Keating understood this, as did most other politicians of his time; that the manner in which we work to produce an income is intrinsic to how we live as a society.
It is too much to expect politicians today to have Keating’s verve, vigour and vitality of language, but it is not too much to expect that they understand what the economy is, and what it isn’t, and that they shift from discussing restructuring the economy to restructuring our society, because in essence, that is what any restructuring is.
Politicians see the impact of Covid-19 as a challenge – how to save ‘The Economy’, how to restart ‘The Economy’, but many in the community see it as an opportunity – how to change our lives, how to improve our society. The politicians want to be able to trumpet ‘a good set of numbers’, whereas people want steady work, decent work conditions, quality of life outside of work and the flexibility to cope with life’s ups and downs.
There needs to be an understanding that the plan being developed to manage the recovery from the pandemic is not just about re-starting our economy, it is also about re-starting our lives.
If history is our guide, the shift to focusing on people rather than the economy triggered by Covid-19 will be shortlived, and we will revert to the theme of treating ‘The Economy’ as a separate entity from our society. Governments will continue to target the attainment of a certain standard of living as something to be achieved quite separate from and without reference to our quality of life.
If you seek an alternative, then challenge politicians when they announce policies that are ‘good for Australia’, and ask instead, ‘but what will it do for Australians’.
