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Flogging the dead horse of neoliberalism isn't going to improve the economy

Greg Jericho observes in The Guardian (2.4.17) that ACTU secretary Sally McManus was lambasted by the right for saying neoliberalism is dead, but she was just stating the obvious.

'This week brought fresh outrage from conservatives as the new secretary of the Australian Council of Trade Unions, Sally McManus, told the National Press Club “neoliberalism has run its course” and Paul Keating, seen by many as a neoliberal champion, agreed with her. But rather than provoke cries of communism and class warfare, for anyone who has been paying attention over the past decade, the correct response to McManus and Keating’s assertions should be “well, duh”.

'McManus’s speech, in which she not only rang the death knell for neoliberalism but reiterated the right for unions to resist unjust laws (pretty much a central tenet of unions ever since unions were first illegally formed in the 1800s) drew the expected shrieks from the right. The Australian’s editorial, for example, referred to it as “class warfare”, and Peter Dutton called her a “modern-day communist”.

'It’s always class warfare when those representing the low paid worry about inequality. When the most powerful business executives in Australia come to parliament and demand their companies get a tax cut – as occurred on the same day as McManus’s speech – class warfare is never mentioned.

'That’s because neoliberals see company tax cuts as good for workers. A lower company tax, so the theory goes, leads to increased investment, which in turns increases productivity and leads to better pay for workers. It’s a nice theory, and one that works nicely so long as you ignore that over the past decade productivity has risen while real wages have barely grown.'

 

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