Neoliberalism, market fundamentalism and the colonization of Aboriginal policy

"Neo-liberalism is a hungry beast and this 21st Century strain of capitalism is shaping the agenda for control of Aboriginal lands...........Australian Government policy is heavily influenced by neo-liberalism through its extraordinary emphasis on managing access for mining companies to resources on Aboriginal lands. This involves controlling what is still perceived as ‘the Aboriginal problem’ and forcing a social transition from traditional values and cultural practice to ‘mainstream’ modernism of a particular brand. It also involves displacing many Aboriginal people from their traditional lands and concentrating them in ‘growth towns.......To make any sense of the aggression behind most current Indigenous policy in Australia you need to study the impact of neo-liberalism around the globe"  

Jeff McMullen

The Australian journalist, writer and social justice campaigner Jeff McMullen has written two cogent and articulate critiques of the colonization of Aboriginal policy making in this country by the cancer of neo-liberalism (or what others call market fundamentalism). 

One of Jeff McMullen's articles The New Land Grab is available on line here (in The New Internationalist blog). The second piece is a book chapter titled Dispossession- Neoliberalism and the Struggle for Aboriginal Land and Rights in the 21st Century which appears in a new book In Black and White: Australians at the Cross Roads (edited by Rhonda Craven, Anthony Dillon & Nigel Parbury). This article is available here on Jeff McMullen's own website

In drawing on the work of David Harvey and others, and incorporating the voices of Aboriginal people, McMullen makes the case that neoliberalism is a key driver of the agenda for the control of Aboriginal lands and assimilation of Aboriginal people in Australia.  

Neoliberalism, McMullen argues is the ideological underpinning of a uniquely Australian strain of state-corporate capitalism that aims to control Aboriginal communities to enable exploitation of the land and mineral wealth on Aboriginal lands. McMullan argues that the real goal here is the upward redistribution of land and mineral wealth.

McMullen demonstrates the way that successive Federal and State Governments have used the coercive powers of the state to impose an agenda of modernization, control of Aboriginal lands and assimilation and assault on Aboriginal rights and culture.

Drawing on David Harvey's book A Brief History of Neoliberalism, McMullen identifies 4 essential features of the neoliberal agenda and analyses the extent to which they are manifest in Aboriginal policy making in this country:

1. Privatization and commodification of public and community goods. This has occurred through the privatization of Aboriginal lands, via policies that open up Aboriginal land to resource exploitation and attempts to override community land ownership and impose private property ownership rights.
2. Financialization to treat good or bad events as opportunities for economic speculation.
3. Management and manipulation of crises to establish a neoliberal agenda. This includes using the  Northern Territory Intervention as justification for  exerting greater control over Aboriginal communities to enable market and corporate exploitation of the minerals and resources on Aboriginal lands and the use  of 'military style campaigns to exert control and challenge Aboriginal sovereignty
4. State redistribution of wealth, not to the poor but to the rich and powerful.

Analyzing Aboriginal policy through the lens of neoliberalism as McMullen does, helps us to understand what drives social policies such as the Northern Territory Intervention and the social engineering to control Aboriginal people still living on traditional lands, as well as the aggressive land grab by mining and resource companies, aided and abetted by Federal and State Governments, which divides Aboriginal communities, and even Aboriginal families.  He writes:

'Neoliberalism connects the agendas of modernising Aboriginal culture and allowing mining companies to vigorously exploit and minimal cost the mineral treasures on Aboriginal lands'.

McMullen points to the divide and conquer tactics of mining companies and governments in the Kimberley and Pilbara in Western Australia, across the Northern Territory, on Cape York and in parts of NSW and South Australia, as manifestation of these neoliberal agendas.

McMullen is scathing about the role played by influential Aboriginal leaders, such as Noel Pearson, Marcia Langton and Warren Mundine who have become influential advocates and brokers for neoliberal policies and have gathered adherents and supporters in both political parties and corporate Australia.

In memory of Elinor Ostrom (1933-2012)

With the death of Elinor Ostrom, activist and campaigners for social and economic justice have lost an important advocate and supporter.

Ostrom who was a Professor at Indiana University was the first woman to be awarded the Nobel Prize for Economic Sciences in 2009.

Ostrom's work challenged and rebutted fundamental economic beliefs, particularly free market and neo-classical economic paradigms. Ostrom was particularly concerned with relational aspects of economic activity — the ways in which people interact and negotiate with each other to forge rules and informal social understandings.

Ostrom's early work focused on what she called co-production. Ostrom argued that many public services depend heavily on the contribution of time and effort by the persons who consume these services, i.e., the clients and citizens.Ostrom believed that services rely as much upon the unacknowledged knowledge, assets and efforts of service ‘users’ as the expertise of professional providers. It was the informal understanding of local communities and the on the ground relationships that make services more effective.

Co-production describes the relationship that exist between ‘regular producers’, like health workers, police, and schoolteachers and their ‘clients’ who may be transformed by the services into safer, better educated and/or healthier persons.

Ostrom defined co-production as

“…the mix of activities that both public service agents and citizens contribute to the provision of public services. The former are involved as professionals, or ‘regular producers’, while ‘citizen production’ is based on voluntary efforts by individuals and groups to enhance the quality and/or quantity of the services they use”

One implication is that privatization of public services and the turning over of services to the market fundamentally transforms the relationship between provider and service user and hampers the development of co-production and democratic governance.

Her later work examined how people and communities collaborate and organize themselves to manage collective shared resources like forests, fisheries and natural and social resources. The research overturned the conventional wisdom about government regulation and challenged the idea that private ownership of public resources is better and more effective. Ostrom's work provides clear evidence that the commons-based traditions of cooperation and communal management of resources is not a violation of basic economic common sense.

Her work undermines political conservatives and mainstream economists who denigrate collectively managed property and government and who argue that only private property and the "free market" can responsibly manage resources. Her work also directly challenges current ideas that privatization and private ownership and expert management of resources is the most effective strategy.

Ostrom advocated a “polycentric” approach to managing shared or common resources involving oversight “at multiple levels with autonomy at each level. Ostrom argued that shared management of resources helps to establish rules that “tend to encourage the growth of trust and reciprocity” among people who use and care for a particular commons.

Ostrim argued that key management decisions should be made as close to the scene of events and the actors involved as possible.

Her work showed that the people most affected by or with a stake in a particular resource are the ones best able to collaborate to use and manage those shared resources effectively and sustainably.

Ostrom's work demonstrates the importance of shared (collective) rather than expert or private management of resources and knowledge and emphasises the importance of active citizen partcipation. She cited a comprehensive study of 100 forests in 14 countries that detailed how the involvement of local people in decisionmaking is more important to successfully sustaining healthy forests than who is actually in charge of the forests.

David Bollier writes of the significance of Ostrom's work:

In the 1970s, economics was quickly veering into a kind of religious fundamentalism. It was a discipline obsessed with “rational individualism,” private property rights and markets even though the universe of meaningful human activity is much broader and complex. Lin Ostrom pioneered a different, more humanistic way of thinking about “the economy” and resource management. She originally focused on property rights and “common-pool resources,” collective resources over which no one has private property rights or exclusive control, such as fishers, grazing lands and groundwater. This work later evolved into a broader study of the commons as a rich, cross-cultural socio-ecological paradigm. Working within the social sciences, Ostrom proceeded to build a new school of thought within the standard economic narrative while extending it in vital ways.

Ostrom's work also has direct relevance to the current economic and environment crises. She wrote:

"We cannot rely on singular global policies to solve the problem of managing our common resources: the oceans, atmosphere, forests, waterways, and rich diversity of life that combine to create the right conditions for life, including seven billion humans, to thrive.....Success will hinge on developing many overlapping policies to achieve the goals,.......We have a decade to act before the economic cost of current viable solutions becomes too high. Without action, we risk catastrophic and perhaps irreversible changes to our life-support system.”

Articles written in memory of her work are here, here, here and here.

A reading list of her work is here.

The last article she wrote before she died is here

Her last book, published just before her death was titled Working Together: Collective Action, the Commons, and Multiple Methods in Practice, and describes the advantages of using several different research methods to study a problem.

Phillip Pullman and the greedy ghost of market fundamentalism

"there are things above profit, things that profit knows nothing about.. things that stand for civic decency and public respect for imagination and knowledge and the value of simple delight"   Phillip Pullman

This speech by the British novelist and writer Philip Pullman describes the 'greedy ghost of market fundamentalism' that haunts the offices, meeting rooms and conference rooms of Governments all over the world. 

Pullman describes how everything that sustains the fabric of a decent society and of communities is destroyed by the onslaught of the market fundamentalists and their acolytes. He is right. A great speech.

 "And it always results in victory for one side and defeat for the other. It’s set up to do that. It’s imported the worst excesses of market fundamentalism into the one arena that used to be safe from them, the one part of our public and social life that used to be free of the commercial pressure to win or to lose, to survive or to die, which is the very essence of the religion of the market. 

Like all fundamentalists who get their clammy hands on the levers of political power, the market fanatics are going to kill off every humane, life-enhancing, generous, imaginative and decent corner of our public life. I think that little by little we’re waking up to the truth about the market fanatics and their creed. We’re coming to see that old Karl Marx had his finger on the heart of the matter when he pointed out that the market in the end will destroy everything we know, everything we thought was safe and solid. It is the most powerful solvent known to history. “Everything solid melts into air,” he said. “All that is holy is profaned.”

Market fundamentalism, this madness that’s infected the human race, is like a greedy ghost that haunts the boardrooms and council chambers and committee rooms from which the world is run these days"

Market based approaches are a threat to vulnerable people

images by Simon Bosch, courtesy of the Sydney Morning Herald

State and Federal Governments of all persuasion continue their love affair with "market based approaches" to the provision of health services and human and community services. 

These market based approaches take many forms, including privatization and contracting out of government services, competitive tendering of services to not-for- profit and for profit agencies, increasing use of for-profit providers and the private sector  to provide services, use of user pay and cost recovery principles, the application of business metrics and the imposition of corporate management models and approaches that have their origins in the for- profit business context.

But they all are predicated on the assumption that applying market principles to the delivery of health and human and community services will drive innovation, deliver greater efficiency and better quality services and save Governments money.

However, the worsening crises we face in so many areas of social and public policy are largely the result of an over reliance on market based approaches in service delivery and/or the increasing reliance on the private/corporate sector as a provider of services.

The crises in affordable housing, the collapse of corporate provider ABC Learning in childcare, the crises enveloping aged care, the problems resulting from the privatization of employment services, the costs and inaccessibility of many health, medical and dental services, the accelerating cost of public services such as water, gas and electricity, the rationing of services for children and families, are all examples of social policy problems that have been created or compounded by market based approaches.

Adele Horin's piece in the Sydney Morning Herald Sad Truth behind Closed Doors is further evidence of the dangers of relying on market based and for- profit approaches in the delivery of health and human services. Horin shows that a reliance on market based approaches is a threat to the health and well being of vulnerable people. 

Horin argues that the reliance on for- profit providers of boarding houses  to accommodate and support people with mental illness has failed to protect and improve the lives of  vulnerable people. Horin draws on the work of Sydney academic Gabriel Drake who calls the rise of licensed boarding houses in Sydney, as "the privatisation of the back wards". 

In a study of inner Sydney licensed boarding houses, Drake describes a situation where large numbers of people with only their disability in common,  live together with little to do, receive poor mental and physical health care, and have few chances to learn skills. Their pension is handed over. They can't afford a bus fare. They become highly dependent on the boarding house owner.

Horin describes how the failure by Governments to provide the funds  and support to people with mental illness who were "de-institutionalized" and moved out of large psychiatric institutions meant that they were thrown to the vagaries of the "market"

And so hundreds moved into the boarding houses which were run for profit with minimal or no accountability or monitoring. People with sometimes serious conditions, such as schizophrenia, went from the state being in charge of their welfare to a boarding house owner.

The state passed a law to license boarding houses that accommodated people with psychological or intellectual disabilities. But three Ombudsman's reports in nine years - two of them secret and the latest delivered to the Minister for Disability Services last month - testify to the failure of the responsible government department, Ageing, Disability and Home Care, to do its job of inspecting and monitoring the boarding houses properly.

A weak law, and some aggressive licensees, did not help the hapless bureaucrats in their role of protecting and improving the lives of the vulnerable residents.

It is time the state government took a serious look at boarding houses, both the licensed kind, and the unlicensed, which cater to a slightly different clientele of poor, single tenants often with alcohol and gambling addictions.

The failure of market driven reform in Australia

John Quiggin is one of a growing number of Australian economists who continue to make the case that the market-based reforms imposed by Federal and State Governments over the last two decades have not delivered the anticipated benefits for consumers and ordinary citizens, and in many cases have been unmitigated failures.

Market led reform assumes that market-based solutions are always best, regardless of the problem.

Other important contrarian economic voices about market driven neoliberal reform championed by mainstream economists and Australian governments of all persuasions can be found on the pages of Dissent, the excellent journal edited by the Age and Sydney Morning Herald economics writer Kenneth Davidson and in the Journal of Australian Political Economy produced out of the University of Sydney. Bloggers such as Billy Blog (Bill Mitchell) also provide important critiques of mainstream economics, as do academic economists and public commentators such as Con and Betty Walker.

In today's Australian Financial Review John Quiggin argues that:

The failure of reform is most dramatically evident in the infrastructure sector, and particularly for utilities such as electricity, telecommunications and water.

Quiggin argues that the benefits of market led reform that were promised by its proponents have not resulted. Whilst there were some benefits in the short term, in the longer term the proposed benefits for consumers and society have not been sustained. Prices have not lowered but increased. Supposedly, allowing the market to rip would bring more choice and better quality of service. Neither have happened.

As Quiggin points out, the privatization of telecommunications and electricity have been unmitigated failures for consumers and society. Electricity price inflation has reached double digit levels and the break up of electricity utilities into separate generation, distribution and retail sectors has created massive new problems.

Quiggin argues that it is time for policy makers, politicians and commentators to accept that the mantra of market led reform has been a complete failure in the infrastructure sector. He writes that:

Faith in reform has proved utterly impervious to contrary evidence. The only answer to the failure of reforms has been to conclude that more reform in needed.

But as John Quiggin notes the lure of market led reform is still all powerful:

Despite this and other failures, the incantation of ‘reform’ retains its magical power. The politically and economically disastrous privatisation program in NSW was justified entirely on the basis that it was needed in order that reform could continue.

It is, perhaps, too much to ask that such an appealing word should be abandoned. But can’t we at least admit that the 1980s reform program has had its day, and look for some reforms more appropriate to the 21st century?

The failure of market driven neoliberal reform in the infrastructure sector (water, telecommunications, utilities, and public infrastructure) and in many other areas of Australian social and economic life, including health, housing, social welfare, retirement incomes, aged care, education, child care, human and community services and the environment and climate change, are core themes in Australian journals such as Dissent and  the Journal of Australian Political Economy, which in each edition document the harm that has been done by market driven neoliberal reform in this country.

More Australians need to support and read the important work done by economists such as John Quiggin, Bill Mitchell, Con and Betty Walker and all those associated with journals such as Dissent and The Australian Journal of Political Economy.

Phillip Pullman and the greedy ghost of market madness

"there are things above profit, things that profit knows nothing about.. things that stand for civic decency and public respect for imagination and knowledge and the value of simple delight"  Phillip Pullman

Fantastic speech here by British author Phillip Pullman on what he calls "the greedy ghost of market madness" and the social, cultural, and democratic dislocation that it causes. 

In this speech Pulman attacks the British Government for its austerity cuts which are resulting in the closure of hundreds of libraries throughout the UK and are hitting the most marginalized and disadvantaged the hardest, whilst delivering tax cuts and more public funds to the wealthy, the corporate elite and business and corporate interests.

Pulman points the finger directly at all those who advocate for the unfettered freedom of the market  and who measure the success of an endeavor or a public responsibility by the metric of profit .

"...........And it always results in victory for one side and defeat for the other. It’s set up to do that. It’s imported the worst excesses of market fundamentalism into the one arena that used to be safe from them, the one part of our public and social life that used to be free of the commercial pressure to win or to lose, to survive or to die, which is the very essence of the religion of the market. Like all fundamentalists who get their clammy hands on the levers of political power, the market fanatics are going to kill off every humane, life-enhancing, generous, imaginative and decent corner of our public life. I think that little by little we’re waking up to the truth about the market fanatics and their creed. We’re coming to see that old Karl Marx had his finger on the heart of the matter when he pointed out that the market in the end will destroy everything we know, everything we thought was safe and solid. It is the most powerful solvent known to history. “Everything solid melts into air,” he said. “All that is holy is profaned.”

Market fundamentalism, this madness that’s infected the human race, is like a greedy ghost that haunts the boardrooms and council chambers and committee rooms from which the world is run these days.

So decisions are made for the wrong reasons. The human joy and pleasure goes out of it; books are published not because they’re good books but because they’re just like the books that are in the bestseller lists now, because the only measure is profit.

The greedy ghost is everywhere. That office block isn’t making enough money: tear it down and put up a block of flats. The flats aren’t making enough money: rip them apart and put up a hotel. The hotel isn’t making enough money: smash it to the ground and put up a multiplex cinema. The cinema isn’t making enough money: demolish it and put up a shopping mall.

"...............The greedy ghost understands profit all right. But that’s all he understands. What he doesn’t understand is enterprises that don’t make a profit, because they’re not set up to do that but to do something different. He doesn’t understand libraries at all, for instance. That branch – how much money did it make last year? Why aren’t you charging higher fines? Why don’t you charge for library cards? Why don’t you charge for every catalogue search? Reserving books – you should charge a lot more for that. Those bookshelves over there – what’s on them? Philosophy? And how many people looked at them last week? Three? Empty those shelves and fill them up with celebrity memoirs.

That’s all the greedy ghost thinks libraries are for.

Now of course I’m not blaming Oxfordshire County Council for the entire collapse of social decency throughout the western world. Its powers are large, its authority is awe-inspiring, but not that awe-inspiring. The blame for our current situation goes further back and higher up even than the majestic office currently held by Mr Keith Mitchell. It even goes higher up and further back than the substantial, not to say monumental, figure of Eric Pickles. To find the true origin you’d have to go on a long journey back in time, and you might do worse than to make your first stop in Chicago, the home of the famous Chicago School of Economics, which argued for the unfettered freedom of the market and as little government as possible.

Australians thinking and writing about Markets and Society

Damien Cahill  is an Australian academic who has written extensively about the influence of neoliberalism and the use of market solutions to an increasing number of social issues. Some of his writings can read here and here.

Damien is also the co-convenor of the Markets and Society Research Network at the University of Sydney, which  brings together social scientists concerned about markets and society to discuss the social foundations of markets; the regulation of markets; the social effects of markets; and the shifting boundaries between the state, private sector, and civil society.

Like this blog, the Market and Society Research Network aims to challenge orthodox conceptions of markets at a time of increasing ‘marketisation’. This  includes critical examination of the role and nature of markets, the legitimate scope of markets as well as investigations of markets as sites of contestation.

The Network recently ran a 2 day conference to critically analyze the increasing reliance on market-based solutions in Australia  in areas such as  climate change, provision of human services, childcare services, health, education, superannuation and housing. The program and the papers can be read here.

Market illogic and the manufacture of "defecit hysteria"

Three hundred US economists have warned that current US economic policies risk plunging the US into a deep depression, unseen since the 1930's. 

As the economic circumstances of ordinary Americans worsen, the economists are warning against "deficit hysteria", the contemporary obsession with short term government deficits which lead governments down the path of severe austerity measures and massive reductions in public spending. 

The economists argue that defecit hysteria is a manufactured crises and is being used as cover for other agendas, including more privatization and slashing of social security and social spending.

The economists stress the need for increased public investment to thrust the US economy back into recovery.

The economic crises confronting the US is borne out by recent data which shows that more Americans are poor than ever before (since data was collected). Unemployment and job losses continues to rise and there are now 43.6 million Americans who are poor, as measured by the US Census Bureau. 


Juxtapose this information with the graph below about US income growth (posted before) and we can begin to understand what David Harvey means by accumulation by dispossession, the process whereby the rich, the wealthy and upper middle class gain greater wealth and power at the expense of the rest.

For an an alternative perspective on economic policy: read Billy blog

Bill Mitchell's blog Billy Blog-alternative economic thinking is an excellent site to read about the myths and propaganda promulgated by mainstream economists, economic commentators in the media and most politicains and political commentators. 

As a non-economist interested in economic matters I greatly appreciate Billy blog's sustained critique of neoliberal and neo conservative market economics.

Reading one of his latest posts about the standard myths that dominate most neoliberal economic thinking I found this:

"The overwhelming sentiment of the business community and the conservative nature of our political system (and its participants) leads to a largely anti-government swell of opinion which is continually reinforced by the media – the “debt-deficit hysterics”. The neo-liberal expression of this over the last three decades has overwhelmingly imposed massive political restrictions on the ability of the government to use its fiscal policy powers under a fiat monetary system to ensure we have full employment.

We now accept very high unemployment and underemployment rates as a more or less permanent feature of our economic lives because of the political constraints imposed on government"

The harm that markets cause: event in Fremantle

Great to see this event The Global Economy and Human Wellbeing  being run by Rob Lambert* at the Edmund Rice Centre for Social Justice in Fremantle this Saturday 4 September, 2010 between 10:00 AM - 5:00 PM.

The event is designed to provide people with a deeper understanding of what global free markets are doing to persons, families and societies;  the nature of corporate restructuring of work, and its social and psychological impacts for families and communities; - basic analytic techniques of ‘political economy’ necessary for understanding these changes; - the values underlying these changes, and how they might be ethically assessed; and - how to envisage (imagine) alternative models of work, and the process of realising such change.

 *Winthrop Professor Rob Lambert is based at the University of Western Australia’s Business School, where he specialises in labour studies. He is co-author of the award-winning book, Grounding Globalization: Labour in the Age of Insecurity (Oxford, Blackwell, 2008),a critique of the free market economy that identifies destructive impacts for the environment, society, families and persons. Rob is the founder and coordinator of the Southern Initiative on Globalization and Trade Union Rights (SIGTUR), founded some 20 years ago. This movement brings together democratic trade unions across 15 countries and four continents in the global south. Rob has a background as a South African activist, and was National Secretary of the South African Young Christian Workers and then advisor to the Southern African Catholic Bishops Conference before coming to Perth.

Western Australia and the downside of economic booms

Peter McMahon is co-Director of the WA 2020 Project at the Institute for Sustainability and Technology Policy within the School of Sustainability at Murdoch University. The WA 2020 Project aims to fill the policy vacuum that exists in WA in relation to issues of sustainability. In particular, it hopes to build connections between researchers, citizens, social movements, activists and civil society groups to generate understanding and action on threats to sustainable living in WA.

Peter McMahon has written important pieces on the unsustainable nature of the WA economy and community, and the fragility of WA's mining and resources boom. In a number of papers on the website of the WA 2020 project McMahon has contributed an alternative history of WA's economic development and a very different narrative about economic, environmental and social sustainability in WA.

Peter McMahon is a regular contributor to the national online magazine Online Opinion (his articles can be found here). This piece appeared recently and is reproduced with acknowledgments to Online Opinion.

A 'Big' West Australia? by Peter McMahon

The current debate about a “Big Australia” is strongly influenced by the sense that the country has a bright economic future. This economic future has been increasingly determined by the resource-rich states, Queensland and Western Australia, and although these states are leading growth there are major problems threatening this situation. This article looks at the case of WA.

Perth is now the country’s fastest growing city and a debate has begun in WA sparked by claims that the population would double by 2050. Perth itself was projected to grow to two million residents and sprawl over 12,000 sq km (which is almost 50 per cent more than New York with nearly 18 million people).

The Australian Bureau of Statistics report estimates that in response the urban road system must be doubled to 27,000km to accommodate the increased traffic, 1300 new schools must be built and water and energy consumption will double requiring new desalination and energy plants.

The main thing driving this “Big WA”notion has been the resources boom which has made WA a major exporter and generated big money for workers, investors and governments. The general optimism arising from the boom, which has been assiduously boosted by local business, the media and politicians, has propelled the idea that the state is capable of anything.

The underlying realities are very different. The WA boom is in fact based in the unprecedented demand for resources caused by the equally unprecedented Chinese economic boom. China has bought WA steel at top prices and wants WA gas and perhaps WA uranium.

However, the Chinese boom is much more fragile than most people understand. The Chinese economy is unbalanced with an orientation towards exports, and this economic growth has been at the expense of social justice and the environment. The authority of the Communist Party is based on this economic success, and if this fails then political upheaval will likely follow.

Furthermore, the Chinese boom has been underpinned by conducive global conditions, and if these change markedly economic growth could collapse. The ongoing global economic crisis, the fragility of the US economy, the ebb of globalisation and a number of other developments threaten this accommodating world order.

As for the other major WA export earner, agriculture, changing rainfall patterns, salinity, soil acidity and erosion threaten the total amount of arable land, while increasing fuel, fertiliser and chemicals costs is driving farmers into ever greater debt. Last year the average loss for hard-pressed Wheatbelt farmers was half a million dollars.

The real inhibitor to WA growth is the unsustainability of current trends of consumption, based as they are in boom-time conditions. Indeed, WA is arguably the least sustainable community in the world, outside totally crazy places like Dubai. Essentially, there is not enough water, not enough infrastructure and not enough cheap energy to pursue the current high growth strategy for much longer.

Western Australians are world class consumers and waste generators. Of the more than 1,800 gigalitres of water they use most goes to agriculture (40 per cent), then mining (24 per cent) then households. Most household usage is for gardens, with usage for luxury items like dish washers and swimming pools a growing factor.

The problem is that rainfall is declining, at least for the south west where the decrease has been around 25 per cent. Dams are emptying out and Perth has resorted to making fresh water though desalination, a highly energy intensive process. The WA Government is slowly introducing conservation measures for households, but overall the situation is approaching criticality even though consumption has stabilised.

WA is Australia’s greatest producer of waste. In 2002-3, WA per capita waste totalled 1.4 tonnes with around 7,300 tonnes disposed of in 300 landfills each day. The housing boom has been a factor here since most waste comes from building demolition and activity, followed by municipal waste collection and then commercial and industrial activity. Along with the quantity, growing levels of toxicity in the waste is a problem.

Western Australians live in the biggest houses in the world (the average house size has doubled while occupants halved over the last half century). The average house price in WA recently rose to half a million dollars. As for that other major consumer item, WA has the highest vehicle ownership rates (75 per cent) in Australia, and the distance driven has been increasing (to nearly 8,000km per car in 2004).

When estimated in terms of ecological footprint (the amount of land needed to meet each person’s resource requirements) WA unsurprisingly rates very high. In 2001 the ecological footprint was 14.5 hectares, well above the national figure and very high when compared to the global level of 2 hectares.

The upshot of all this is that not only can WA not support the population rise suggested, according to any sense of fairness it shouldn’t. Such an increase would mean the perpetuation of grossly unfair resource distribution on a global scale.

The underlying cause of WA’s development has always been the availability of cheap fossil fuels to power the transport, industry, mining and agriculture that have formed the state economy. It was the combination of steam and the gold mining boom that got WA going in the 1890s, then the internal combustion engine and agriculture that kept it going after that until new transport technologies and the iron ore boom kicked in after the 1960s. Along the way jet engines made WA much closer to the eastern states and the rest of the world, easing the problem of isolation.

Now WA has itself become a major energy supplier, mostly in the form of gas but also uranium. There is currently a big debate about whether WA gas should be going to overseas markets as liquid gas, or kept for local use (right now 15 per cent is set aside for local use). The gas is actually some way offshore (the Gorgon gas field is around 130 km of the north-west coast), ours by virtue of a treaty signed in the 1950s, and a recent report highlighted the security concerns in relation to this. China, already a major buyer of north-west gas, is building a blue water navy and was the focus of recent Defence White Paper on future strategy.

The uranium is inland and reserves - totalling around 193,000 tones or 5 per cent of the global total - will begin to be mined soon, perhaps this year. There has in the past been pressure for WA, with large tracts of geologically stable desert, to accept nuclear waste, and this is likely to happen. WA also has mineral sands, some of which (thorium) can be used as nuclear fuel.

The boom-bust economy that is driving high growth rates in WA has been criticised as a longer term prospect for economic reasons. Jon Sutton, Bankwest managing director, wrote in the West Australian that rather than relying on the resources sector alone, “(w)e need “State building” projects. Instead of squandering this bounty, we need to channel some of the receipts of our next period of growth into big infrastructure projects that benefit the State and create jobs in their own right.”

This comment is particularly apposite as much the state’s infrastructure is old and furthermore must be replaced in order to deal with the impact of global warming. A recent storm that knocked out electricity in nearly a quarter of all homes, brought down much of the telecommunications system and gridlocked the major roads network, all costing the major part of a billion dollars, showed just how vulnerable Perth is to such disruption.

Which brings us to the final reason why the Big WA future can’t happen. Dealing with global warming necessitates increased fossil fuel prices, and as peak oil cuts in prices will also rise because of this. WA is already suffering from major household energy cost rises (with increasing numbers of households unable to pay: 17,000 households were disconnected for non-payment of bills by Alinta Gas last year), and rising fuel costs will hit hard. This includes personal travel in cars, commercial logistics and air travel. Furthermore, mining and agriculture are major energy users of energy and will be heavily affected as both operational and shipping costs go up.

There are signs that the current WA state government is at last making some plans for the future, notably the Directions 2031 initiative, but there are no signs that they see the energy crunch as a real issue. Not only is Big WA unlikely, if the energy crunch hits an unprepared WA we may well see a considerably smaller WA as people abandon a state in real trouble.

Neoliberalism- still well and truly alive and kicking hard

Important program on Radio National's Late Night Live with Phillip Adams talking with David McKnight and Richard Dennis on the topic "Is neo-liberalism Dead in Australia".

The program was built around the new book edited by David McKnight and Robert Manne titled "Goodbye to All That: On the Failure of Neoliberalism and the Urgency of Change".

Richard Denniss from the Australia Institute argued that neo- liberalism is well and truly alive in Australia. His view is that at the level of macro-economic policy there has been a small departure away from neoliberalism, exemplified by the Rudd Government's stimulus package and its willingness to intervene in the economy to respond to the global economic crises. However, Denniss argues that at the level of micro-economic policy the hold of neoliberalism over the Rudd Government is a strong as ever, if not stronger than before the global crises.

Neo liberalism in post apartheid South Africa

Image from Zed Books

" Despite the government having replaced the predations of apartheid with one of the most inclusive and progressive constitutions on earth, neoliberal capitalism has stalled the rights of ordinary people in South Africa"
Raj Patel, The Value of Nothing, p 135

Gavin Mooney is currently teaching in South Africa. This piece follows an earlier piece on the anniversary of the Sharpeville Massacre written by Colin Penter that can be found on his blog.

Neo liberalism in post apartheid South Africa By Gavin Mooney

The 50th anniversary last week of the Sharpeville massacre left a bitter taste in the mouth. For my generation- I was 17 at the time- it was a truly horrendous barbaric event and it was seen as such by many across the globe. Sixty nine people killed, mown down in cold blood standing up for their rights. Horrific- and 50 years on I can still vividly remember how tangible was the outrage.

Here in South Africa at present for a few weeks, what does the memory of Sharpeville convey? Perhaps more than anything a great sadness arising not so much from the massacre itself but from events in the years since.

Enormous hope was kindled by the release of Mandela and the ensuing democratic elections of 1994. The hope continued as, in the initial years of black rule, some attempts were made to bring about elements of social justice in this country. There was an economic policy called GEAR which at least had R for redistribution in it. But then the neolibs re-established themselves and Mbeki set out to show he was just as capable of running an economy along neoliberal lines as any white man. And he did.

As a result poverty remains horrendous in this country; and inequality is now worse than in 1994. Let me repeat that. The inequality today is worse than it was in the apartheid years. South Africa now competes to be the most unequal society on the planet.

Yet the world still sees South Africa as free, as democratic, with a (genuinely) wonderful constitution. This 'wonderful' constitution in this 'liberal democracy' has failed to deliver either freedom or justice to the people.

Sad how the world could condemn the evils of apartheid- and rightly so- but passes by on the other side when the perpetrators of oppression are driven by neoliberalism and not race. Is it any more obscene? Has the world become just too bored with all the poverty and inequality to care any longer? Have individualism and materialism become so dominant globally that compassion and concern for the vulnerable and oppressed are now passe?.

To me the real sadness today is that no one would seem to care enough to listen if South Africans were to protest and bring about another Sharpeville. Why would the poor of South Africa risk provoking another massacre when they know that no one cares any longer? Then the 'enemy' was clearly identifiable as white supremacy; today when neo-liberal ideology is 'the enemy'...?

Alternatives to market approaches

Looking for alternatives to neo-liberalism

by Gavin Mooney

One of the issues that must become foremost in any challenging of the market is to imagine alternatives. I am doing this in economics and health policy. My starting point is that health care systems need to be seen as social institutions. Here I spell out some of my thinking. Is there I wonder, merit in running with this idea in a wider context?

There is a need to consider the broad, social role of health care systems as institutions, as part of the fabric of society. Such a focus means trying to devise ways to involve the community as a community in values to underpin these social institutions.

With respect to health care, there is a need for a dual level approach, a personal one nested within a community one. The first is at the level of individual desire for our own health. The other, community level, is concerned with setting the social principles on which health care systems are to be based. At this second community level the individual now is a citizen rather than a patient.

Two potentially important caveats here. First the citizenry will need some education so that they operate on an informed basis. Second there is a risk, that needs to be addressed, that the rights of minority groups will not be adequately recognised by the majority.

What is required to pursue the above proposal is to determine how different levels of preferences might be elicited. Three levels of preferences or interest functions are proposed.

In the context of multiple interests functions it is useful to think of Frankfurt's** first and second order preferences and to develop a third order as well. The first approximates to some notion of desire; the second to what individuals want when they have time to reflect, perhaps embracing the issue of what sorts of individuals they want to be. These may be different not only in being reflective, but also in terms of the object of the preferences. This is inter alia because reflection comes at a cost; time is needed for reflecting (There seems little point in reflecting over long on whether to buy a chocolate bar but we might want to dwell more on preferences about our chocolate dependency.)

Third order preferences are "communitarian". This philosophy recognises that individuals are not free floating atoms. Their identities are embedded in some community/ies. Being active in a community is good in itself and not just instrumental. Institutions such as health care, but also education, are valued not only for producing some narrowly defined outcomes such as health gain and educational human capital gain. They can be valued for other outcomes, in health (e.g.information) or processes (e.g.caring), or as institutions per se which contribute to the decency of a society (e.g such as a tax based universal health care system). These issues are related to what sort of society citizens want.

To advance these third level preferences I have proposed the idea of "communitarian"claims." John Broome proposed the idea that a claim to a good meant that there was a duty owed to a person that she or he have the good.

I have previously suggested moving Broome's concept of claims to make it more relevant to the discussion here in the following way. It is proposed that "communitarian claims" be a sub-set of claims more generally where this sub-set is the responsibility of the community to meet or address. Thus, the duty in the case of communitarian claims is a duty owed by the community.

These are labelled "communitarian claims" reflecting the fact that it is the community who have the task of deciding what constitute claims, the duty to allocate claims and to decide on the relative strengths of different claims. There is value in being part of the process of arbitrating over claims. The more embedded individuals are in a community, the stronger will be communitarian claims in that community.

The strength of a claim is not a function of an individual's ability to manage to feel harmed. Harms and the strength of these harms are for the society to judge not the individual.(In the market, income is the determinant of claims and individual satisfaction is what is to be maximised). Strictly, with respect to claims, the bad feelings arising for the person harmed are only relevant in so far as the society deems them to be relevant. They are a matter for "community conscience".

The actual consumption of the resources however remains determined by how an individual values the options with which he or she is then faced.

Finally it is apparent that there may be problems in advancing the concept of claims and retaining the ability to measure and quantify within whatever set of principles emerges.

I am unsure if the obsession with quantification is a product of the market or not-it is certainly more prevalent in today's neo- liberal societies. On this issue Amartya Sen the Noble laureate in economics argues that measurement can be taken too far and he seeks to guard against 'over completeness'. As Sen sees it:

"Waiting for toto" may not be a cunning strategy in a practical exercise".

He suggests that:

"the nature of interpersonal comparisons of wellbeing.. as a discipline may admit incompleteness as a regular part of the ... exercise.. An approach that can rank the wellbeing of every person against that of every other in a straightforward way.. may well be at odds with the nature of these ideas"

So I don't worry too much about such problems. Maybe others will. More importantly for this blog I wonder if others can see merit in using the idea of communitarian claims in sectors outside of heath care.

* Broome, J (1991) Weighing Goods, Blackwell
**Frankfurt, H (1971) Freedom of the will and the concept of a person, Journal of Philosophy, 68:5-20
*** Mooney, G (2009) Challenging Health Economics, Oxford University Press
**** Sen A (1992) Inequality Re-examined, Clarendon

Sarah Burnside on market logic and welfare reform

Most weeks Sarah Burnside*, a West Australian native title lawyer and writer, reflects on State and national issues in national online publications such as Eureka St, New Matilda and Online Opinion. A previous piece she wrote on the WA mining boom was published on this blog (and contains links to many of her writings).

In the piece published below Sarah analyzes Tony Abbott's recent statements on his plan to reform disability pension arrangements. Like Kevin Rudd before him, Opposition Leader Tony Abbott is engaged in a concerted political strategy to re-brand his party's three decades long embrace of punitive neoliberal social policies under the banner of 'compassionate conservativism'. But the contradictions are always evident, as Sarah Burnside points out in this important piece.

What is also interesting is the silence of Tony Abbott, and all those who argue the urgency of welfare reform, over the bigger problem of 'corporate welfare' for corporations and business and the provision of generous 'middle class welfare' by the Howard government (of which Abbott was a key figure) and subsequent Rudd Government.

Tony Abbott's proposal to reform the Disability Support Pension
by Sarah Burnside
Opposition Leader Tony Abbott drew media attention recently for proposing a 'welfare crackdown' to include compulsory work-for-the-dole schemes and higher threshold for eligibility for disability pensions. With respect to the latter, Abbott proposed a review by the National Audit Office to determine more stringent eligibility rules for the disability pension and suggested that recipients with 'less serious medical conditions' be required to undergo annual medical reassessments and sit two interviews each year to 'encourage them into employment'. Currently, 700,000 Australians receive the disability pension. Abbott estimates that around one-third of these people have conditions he would class as 'less serious'.

The Centrelink website explains that eligibility for the Disability Support Pension (DSP) is determined by reference to a set of criteria and usually requires a report from a person's doctor or specialist, and a job capacity assessment. People may be eligible if they are unable to work for15 hours or more per week at or above the relevant minimum wage or be reskilled for such work for the next two years because of illness, injury or disability, or if they are permanently blinded.

Unlike previous Coalition rhetoric on welfare recipients, which tended to damn them as 'bludgers', Abbott's language is more sophisticated, being couched in terms of care. In his 2009 book Battlelines, Abbott posited that 'allowing people who could readily work to stay out of the workforce for long periods is cruelty,not compassion'. This is a classic example of 'compassionate conservatism', a trope employed by UK Tories and US Republicans to varying success in the past decade to counter perceptions of the Right's heartlessness. The implication is that progressives are ideologically wedded to the welfare state but have little empathy for those who are dependent on it; conservatives alone manifest genuine concern for those members of the community. David Penberthy of The Punch supports Abbott, writing:

Apparently it's better to maintain a welfare program that would consign people to a dispiriting life of idolence, exposing them to the mental health anguish that comes with non-participation, rather than ask them some slightly tougher questions about what they would actually do.

The arguments are persuasive- surely no one wants to condemn their fellow citizens to a life with no prospect of employment. Anecdotal evidence suggests that most welfare recipients wish to find employment and that, lacking the social hub of a workplace, they feel isolated and lonely. Several issues are glossed over, though, in the invocation of compassion to justify limiting access to the disability pension.

Firstly, welfare recipients and their families would no doubt challenge the assertion that it is easy to 'qualify' for the disability pension or retain access to it. Interactions with government bureaucracy, involving vast amounts of paperwork, are often frustrating at best and mystifying a worst. Former welfare rights advocate Susie Byers discerns a 'culture of punishment within Centrelink and its parent Department's', born of a 'suspicious pessimism about the motivations and goals of those who are unemployed, raising children, or living with disabilities'. Byers suggests that the process of achieving government benefits is dehumanizing and humiliating, noting that those who claim payments 'expose themselves to invasions of privacy that would make the humblest of aged pensioner feel like a criminal'.

Abbott's suggestion that an audit of the eligibility rules is needed 'to ensure that only those who genuinely deserve the benefit receive it' subtly invokes the stereotype of the bludger without providing any evidence of such exploitation, Generally speaking, it seems likely that any benefit system will attract the self-interested as well as the needy. So be it: this is the price we pay for living in a civilized community that cares for its citizens. To make a whole class of people suffer for the sins of a few- even under the mantle of compassion- would be in this context as in others, profoundly unethical.

Secondly, Abbott's classification of muscular-skeletal and psychological/psychiatric disabilities as the categories within which 'less serious' conditions might be found seems opportunistic. Muscular-skeletal conditions may involve chronic pain which is inherently difficult for external parties to perceive. Similarly, psychological or psychiatric illness is not readily identifiable by bureaucrats seeking to limit entitlements. The nomination of these categories suggests a certain lack of sophistication-if someone's not in a wheelchair or holding a cane they must be capable of holding work. These are people already people vulnerable to accusations of malingering, given the increasing sceptisim about diagnoses of mental illness. It is thus important to note that one cannot qualify for the disability pension by feeling a bit blue. The criteria regarding psychiatric impairment in the Social Security Act 1991 (Cth) specify that mild but regular symptoms which tend to case subjective distress' and give rise to 'minimal interference with function in everyday situations' will not of themselves render one eligible for the pension.

Thirdly, despite the existence of such services as Job Services Australia and the Disability Employment Assistance Services it is far from clear that there is an aequate level of support available to help people with disabilities find jobs and mentor them while in employment. A HREOC National Inquiry into Employment & Disability in 2006 noted that, although 'most people with disability want to work if they have the capacity to do so.. we cannot expect high participation rates if people with disability have work-related expenses that are higher than their potential wages or they cannot access the supports they need'. A 'tightening' of the criteria for access to the disability pension would increase the existing need for serious investment in encourageemnt of flexible workplaces and programs to help people find and stay in employment.

More broadly, there are problems with the prevalent view, integral to Abbott's rhetoric, that employment necessarily imbues people with self-esteem and a sense of purpose and enables them to lead meaningful lives. Such a claim might hold true for skilled workers, including educated professionals such as politicians, or those at the other end of the Australian job market, the prospects are less alluring.

The writer Anne Manne, a trenchant critic of the 'Get to Work neo-liberal program', cited her own experiences of dismal jobs, including a stint as a jillaroo, in her 2008 Quarterly Essay ' Love and Money:The Family and the Free Market'. Manne challenged the view that paid work is inherently fulfilling, noting 'when my university teachers talked of the liberation of work, they did not mean domestic help in rural NSW', but rather-like Betty Friedan in The Feminine Mystique- 'prestige work'. Self evidently, prestige work is not available to all. Many workplaces are not flexible enough to cater for the needs of people with disabilities, Further there will always be jobs no one wants to do; such roles are filled by the people relegated to being the leftovers of the modern economy.

In her 2005 Griffith Review Essay law Professor Rosemary Hunter traced shifts within the Australian labour market and their effects on family disputes, noting that the 1990s had seen a 'rise of precarious low-quality employment'. Hunter suggested that 'Australia's current low unemployment rate.. does not signal economic prosperity but rather the rise of the working poor, and the phenomenon of labour market churning, whereby people move constantly between unemployment and poorly-paid, casual and part time jobs, which they must accept as a condition of continued support when they are again unemployed'. The superiority of such a life over one on the disability pension is not immediately obvious.

Currently families make up the shortfall in support of people with disabilities: this kind of informal care is characterized by feminist economist Nancy Folbre as the 'invisible heart' that combines with the 'invisible hand of the market' to render our society functional. Reliance on the family, however, is not sustainable. Its time for a real debate about how people on government benefits can be supported to live meaningful lives, including assistance securing employment where appropriate. The seductive language of dignity, choice and productivity employed by Abbott is unlikely to assist such debate.

*Sarah Burnside is a West Australian solicitor with an interest in history, native title, nationalism and politics. She works at the Yamatji Marlpa Aboriginal Corporation (YMAC), which represents native title claim groups in the Yamatji and Pilbara regions of Western Australia. The views expressed in her articles do not necessarily reflect those of YMAC.