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Monthly Archives: December 2013

Kurtz: I expected someone like you. What did you expect? Are you an assassin?
Willard: I’m a soldier.
Kurtz: You’re neither. You’re an errand boy, sent by grocery clerks, to collect a bill.
Apocalypse Now (1979)

Figured it out. Its about destroying Unions.

More specifically its about destroying the voter base from which the ALP draws its support, an important component of which is Unions. Viewed from this perspective several of the Coalition’s supposed blunders in the past three months since taking power can be seen as a cohesive strategy and therefore make logical sense as opposed to being seen as inept, crazy or politically miscalculated. This was the error I made in my first blog on this issue.

The objective of political parties is not actually to govern the nation. This is merely the role assigned to them by democratic theory. The objective of political parties is actually to gain power for their donors so that the financial stakeholders (e.g Gina Rinehart, the CFMEU) and their administrative spokesmen (e.g Tony Abbott, Bill Shorten) may divide money and power between them according to their personal proclivities. Such proclivities may include trying to improve the lives of ordinary Australians, or at least the self-delusion that making party donors rich or powerful will do so as a by-product.

Someone once said, politics is the shadow cast by business over society. Precisely. This gets to the point that retail politicking (election campaigns and the like) is merely a proxy war fought by the powerful for power and money. So we may say, moving to the next level of analysis, that each decision of a political administration has as its true objective the continuation of the rule of the current ruling class or faction thereof and/or the disbursement of benefits of power to that faction. Any benefit that may flow to wider society is a necessary cost of power in a democracy, a grudging concession to the need to appease the none-core constituency i.e. those not financial donors or administrative tools. A majority must be garnered and maintained; and propaganda has limits. Voters demand to see the cash / education system they were promised. Unless you can talk them out of it.

The power base of political parties persists beyond each election campaign and their objectives are stable. Gina Rinehart wants to destroy unions today just as much as she did 30 years ago and her donations to the Liberal Party are intended, as they always have been, to procure that objective. Her servants and fellow ideologues, Graham Morris and Mark Textor (LNP strategist), have the same objective. They are constantly looking for ways in which to not only defeat but ultimately destroy the ALP. And the way to do that is to destroy their voting base of which Unions are an important component. This is achieved by Legislation (Work Choices), Propaganda (Rupert Murdoch, The Australian) and, where necessary, the Police or Military in support of legislation (Patrick Stevedores).

Morris Exultant

Here Graham Morris alludes with exaltation to the collapse in Union membership since 1980 and how this has gutted the voter base of the ALP:

GRAHAME MORRIS: Well, I think what we’ve talked about is the Labor Party problem. It is hard to think over the next decade or two where the Labor Party in any part of this country can from here on in govern in its own right. The labour, L-A-B-O-U-R, vote and support has just collapsed. It is down under 30 per cent

A major landmark in this long-term decline was the collapse in Manufacturing, especially Auto, under Keating in the 1990s, following the drastic reduction in tariffs that Keating administered. As George Megalogenis has described, many of those blue-collar workers, formerly unionized, became self-employed as couriers, landscape gardeners and the like. They became self-employed small businessmen and with it LNP voters. This was the genesis of Howard’s Battlers, low-income entrepeneurs, a voting bloc first recognised and effusively courted by Howard and the LNP and ever since a vital cohort of swinging voters, essential to electoral success. The ALP knows them as ‘Working Families’.

And that brings us to the decision to let Holden die, and with it quite possibly Australia’s entire Automotive sector. The decision is insane only when viewed from the perspective of national industrial capacity and diversity, skills retention, research and development and associated goals always considered part and parcel of rational and strategic national objectives.

Ripe

But sane governmental objectives are only tangentially associated with political power. The Automotive sector is heavily unionized. It is crawling with ALP voters. Therefore from the perspective of long-term Liberal Party power interests it is better to destroy the Automotive Industry. So they did: Morris, Textor, Minchin and Cormann I mean. Abbott too. Though frankly Abbott seems unlikely to know with any certainty what day it is. He’s a messenger boy. At best a figurehead. As for Hockey: he too will do what he’s told.

And why kill the industry now ? Because propaganda conditions are ripe. The public is ready to accept it. Unions are long-regarded as evil and European Debt and the GFC have been leveraged by Murdoch to mark government spending, most especially government debt as cardinal irresponsibility, a national shame and a hallmark of incompetence. In short, the public now believes, as per consistent repetition, that there is no reason, place or rationale for subsidy. Except for themselves, personally. If they are middle-class or higher. Subsidy for low-income and unemployed is evil. As instructed.

The next step, almost achieved in the USA, is to train the public to believe that government itself is evil. Then corporations will be able to rule unhindered by any form of regulation.

And the next next major step after that is the dismantling of middle class welfare which happens sometime after voluntary voting is introduced (Freedom TM, Democracy TM). The middle class is only cosseted now because it determines election outcomes. The voting franchise will be moved higher and higher up the socio-economic ladder as circumstances and propaganda permit. That damnable Obama motivated poor people to vote again! This is his true odium.

Cohesive, Logical, Insane

To summarize thus far, the LNP is destroying the Australian Automotive Industry because it is Unionized. By this destruction of Unions they hope to further gut the ALP vote and garner another voter wave of self-employed entrepeneurs, their set-up costs funded by their redundancy payouts.

Seeing the destruction of the Automotive Sector this way makes sense of other decisions taken by the Credlin government: namely Gonski backflips and Child Care pay rise withdrawal.

The LNP wants to destroy public education
because teachers are unionized and because publicly funded schools teach communitarian principles such as conservation and, well, community. The LNP ideal is for each voter to be an atomised, personally obsessed and entirely self-funded microbe operating in complete disassociation with any other person in Australia. This the LNP calls freedom. From communitarian principles spring horrific ideas like taxation, conservation, anti-defamation laws, national parks, equal opportunity and such. These impulses must be resisted and destroyed. Gonski would have strengthened public education. So it had to be undone. And it was.

Pyne was neither a fool, nor out of control, just a bit messy and arrogant. He did precisely what was intended and very effectively. He will be promoted and rewarded within the parallel Universe of the Melbourne Club, by Ambassadorial appointment, Chairmanship of the ICC or indeed whatever the heck he asks for. He may even get a Presidential Freedom Medal from the American Enterprise Institute or whom/whatever for services to crushing socialism in human thought.

Private education, on the other hand, teaches merely personal Values TM from which Libertarianism can be later extrapolated via Uncle Rupert’s wall-to-wall messaging. This is why the LNP gladly subsidizes private education.

The withdrawal of the funding of child care workers pay rises was done simply because the pay rises had to be made under an Enterprise Agreement which allows Unions more entrée to the process. This is plenty reason enough for the LNP to veto it.

Continuous Opportunistic Destruction

The delegitimisation and preferably destruction of unionized or communitarian ideals and institutions is continually in the forefront of the minds of Liberal strategists. Taking advantage of propitious conditions Peter Costello took the opportunity to eliminate compulsory student unionism on University campuses.

While superficially the abolition of compulsory student unionism appeared to be a childish misuse of Federal Government time and power, a juvenile continuation (and it was) of undergraduate politics club feuding into the sphere of national government, this move makes perfect logical sense if viewed as an opportunistic strategic strike against ALP leadership training and the entire legitimacy of unionism as a social institution. A strategy of moral panic was deployed by the Liberal Party in its successful campaign to delegitimise Student Unions by pointing out that Student Unions had sent money to Palestinian Solidarity groups. This rationale was simplified into panic-speak by claiming that Student Unions support Hamas.

The delegitimisation of Unionism has been a constant theme of The Australian since Abbott became LNP Leader Of The Opposition and has continued seamlessly into government. Unions are constantly portrayed as criminal, parasitic and wasteful inhibitors of national prosperity. This caricature is now the standard received Truth about unions for a goodly proportion of Australians.

Class Warfare

All of these decisions: kill Student Unions, kill Automotive, kill Gonski, kill Child Care pay rises were taken because each of them weakens the voter base of the ALP. They are extremely important and strategic decisions taken by the LNP-that-matters (hello Nick Minchin). Class warfare anyone ?

All of these decisions have political cost, i.e. they are all unpopular, and the LNP is now behind in the polls in record quick time for a new government.

But, hey, there are three years until the next election and two weeks until Christmas. People forget. In this way the LNP is doing what all new governments do which is get the bad news out of the way quickly and in plenty enough time for voter amnesia. Most Australians will have forgotten about Gonski and Child Care, let alone Debt Ceiling, by the time they dump the Christmas wrapping paper in the bin.

But the LNP has taken a very big gamble with the Automotive Industry. 50,000 jobs and a string of small component makers. That’s a lot of brothers, cousins, uncles and dads on the scrapheap. And not all at once. Component makers will drop out week in week out for who knows how long. Toyota may hang on for two years and then go. So this particular decision, to let Auto die, crosses the ideological line from long-term Liberal Party political strategy into national destruction.

Maybe the LNP have hamstrung themselves in the first week, like Gillard did with Carbon Pricing.

Mayhap, Touchwood, mayhap.

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I think its because they want a budget surplus. Yes, the vision is that small. Please prove me wrong. (Hang on I just did: here)

Data in this post largely plagiarized from Political economist Dr Remy Davison from Monash University speaking on The World Today

The Australian Motor Vehicle Industry and associated components manufacturers provide 50,000 jobs. The level of subsidy Australians provide is relatively low by international standards. The US government just subsided its own car industry to the point of partial nationalization. ALL national governments heavily subsidize their Motor Vehicle Industry: China, Japan, South Korea, Germany and France.

The level of subsidy may well be $48,000 per year, per job as Treasurer Hockey says, but that’s $25 per head annually which is what the current assistance of $500 million amounts to.

The Motor vehicle Industry produces a $23 Billion dollar gross value add to Australia’s economy and is a $3.6 Billion dollar export industry.

Sorry. I am not seeing the urge or logic here. Where is the over-spend ? Isn’t it obvious that the asset has value ?

Australian banks are subsidized at least 4 times as much as the Motor Vehicle Industry at least $100 per person per year.

The Mining Industry receives $4 billion a year in subsidy. That’s about $200 per year per head or 8 times as much as the Motor Vehicle Industry.

The Australian car industry spends over $600 million per year on R&D. That will stop if the Motor Vehicle Industry dies.

Wasn’t Abbott and his team hysterical when Rudd announced the end of Fringe Benefit Tax concessions on Company Cars during the 2013 election campaign? Wasn’t that going to decimate the car industry ? The same one they are now willing to let die as a costly festering Stone Age heap of useless slag ?

Here’s a quote from the Coalition’s election material on Rudd’s FBT changes:

The Coalition does not support Labor’s $1.8 billion hit on the car industry.

Tony Credlin-Abbott said that Rudd’s FBT cancellation was

a disaster for a motor industry which is already under pressure

and that the FBT concessional support should be maintained to support the industry.

Today it seems the Coalition is happy to see the Industry gone altogether. No, not true. They sincerely want it to survive, but without one cent of government assistance. Which happens nowhere in the world. Its a fantasy.

As Ian Credlin-McFarlane-Credlin, our current Federal Industry Minister said just six weeks ago

every vehicle in the world was subsidised, either directly or in kind, be it through tariffs, currency manipulation or other means…All countries subsidise. Most subsidise much more than we do…If you don’t subsidise the industry, it won’t be there. I accept that argument. I’m not sure that my colleagues do yet.

What drives the Coalition fantasy of a subsidy-free Motor vehicle Industry ? A small headline saving on the 2014 budget spreadsheet ? One which would be dwarfed by the ensuing loss in economic value add ?

Surely not.

Something Worth Subsidizing

So what does the Coalition think is worth subsidizing ? Well, hospitals in marginal electorates. In 2010 Abbott offered Andrew Wilkie $1 bn to re-build Hobart Hospital in exchange for Wilkie’s support in a minority government. The promise was unfunded.

So 50,000 jobs in the Motor Industry is not worth a $500 million subsidy.
1 job in the Federal Parliament, the PMship for Mr. Tony Abbott, is worth a $1 bn subsidy.
Taxpayers should feel…informed.

PS

Actually, back on Hockster’s per job figure I’ve just calculated it. That’s a subsidy of $10,000 per job. Not $48,000 as per Hockster, who must be using direct jobs in direct car manufacturing alone even though he knows the direct manufacturing jobs support the entire component industry. Sneaky old Hockster.

LNP Reneges Again

I was initially gob-smacked that the Credlin LNP government would renege on the agreement by the outgoing ALP to fund a minimal increase in the wages of notoriously underpaid child care workers.

OK, Pyne and Credlin decided to kill Gonski after agreeing pre-election to keep it and Hockey abolished the debt ceiling after spending three years screaming that every cent in deficit was a skull and crossbones tattoo of shame and incompetence, so we are learning to expect both shysterism and hypocrisy as a daily staple from Credlin’s team. But refusing to honour wage rises that had already been agreed ? That’s big. And asking for the awarded wage rises to be voluntarily returned ? That’s borderline crazy.

We’re not talking about Boris Becker returning a golden tennis racket encrusted with diamonds here. We’re talking about low-paid childcare workers doing a job far more difficult and valuable than any financial sector screen jockey and being paid about one of those guys per annum would spend upon wristwatches and Cabernet Sauvignon. You get $19 per hour as a Cert III Child Care worker.

So I just thought, well, they’re shameless that LNP. Howardite non-core promises all over again: secretive, raids on human rights lawyers, Abbott’s six positions on climate change, uninterested in their own MPs rorting the entitlements system…what can you say?

Assisting Unions, Destroying Unions

But then Catallaxy alerted me to the political dimensions of the Child Care pay rise towback: its about Unions. That Catallaxy post, Another Labor scam: promoting unionisation in childcare, explains everything about why the Coalition is so determined to undo this agreement: it works to the advantage of Unions.

The key insight from the Price Waterhouse Cooper report commissioned by Assistant Education Minister Sussan Ley-Credlin

“The fund also required centres to negotiate an enterprise agreement in order to access the money…There is evidence that the requirement to have an enterprise agreement was used by United Voice to increase its membership…

With their typical lowest common baboon level of analysis the Credlin government
has labelled the money a union slush fund

Just quietly, it is possible to have a non-Union enterprise agreement, but Enterprise Agreements do allow Unions much more capacity for involvement in wage agreements, much to the disgust of the LNP and its supporters. Hence the LNP’s determination to defund this agreement. Nothing to do with the major reasons cited: equity and allowing funding for professional development. Everything to do with bypassing Unions.

ALP Shenanigans

The Price Waterhouse Report is quite devastating about the way in which the fund for the pay rises (Early Years Quality Fund – EYQF) was set up. Funds were dispersed on a first-come, first-served basis which of course advantages larger providers who have the resources to quickly submit applications.

Goodstart Early Learning managed to submit a 5000 page application just 48 minutes after the fund opened and applied for $132 million of the $300 million in the total fund. The govt. and Goodstart signed the paperwork for $62.5 million before change of government. Not by coincidence, Goodstart sat on the ALP-established EYQF advisory board but somehow even Price Waterhouse Coopers think there was no conflict of interest in that arrangement, a proposition which even now causes my pet Axolotl, Bruce, to ROFLOL.

Most tellingly, in my opinion, is that PWC found that, unlike its stated objective, the disbursements made under the EYQF do not support the objectives of the Child Care National Quality Framework which is basically to upskill Child Care workers. All of the successful applicants already conform to the NQF guidelines.

So, yeah, the ALP has used this fund to bolster union membership.

So What ?

So the fund acts to increase union membership:

1) So what ?

2) Child care workers deserve a pay rise whether or not they are unionized. And did you know that wage rises negotiated by Unions under an Enterprise Agreement also accrue to non-Unionized workers ? So its not like Unionized workers get more under this deal than anyone else.

3) The undoing of the wage deal is designed by the Libs to keep Unions weak. Its just as politically motivated as the set up of the original fund was.

4) Except the child care workers don’t get any money under the Libs. Funds will be retained says Ley-Credlin, for the good of all. She means she will spend it on training. Maybe.

5) This proves the Libs could not give a reheated rats eyeball about wages in the child care sector. Servants may eat bread, cake, grass, lino or any other (semi) nutritious substance. As long as they dust the Rolex regularly why should I care ?

6) The Coalition cannot win hearts and minds on this argument. Taking money from the low-paid just before Christmas must cost the LNP even more political capital, in which area their resources are already negative. Nuances will not sink in.

7) Just on that, the performance of the Credlin govt. in losing a poll lead just two months after an election is the worst in Australian political history. Long live PM Credlin. May I suggest she applies EVEN MOAR control over her Cabinet and its utterances in order she may utterly drive her govt. into the rocks.

8) But a temporarily bloodied nose is worth it to the Coalition paymasters to keep Unions on the mat. After all, three years till next election…

9) Bolt, Jones and Rupert will be overtime on the megaphone justifying this.

Look, with minimal effort the Libs could have disbursed the remainder of the funds ($237.5 million) as pay rises in any way they chose. Just call it open and accountable or accords with NQF. Message – we care about you and are not sneaky union slush-funders like those ALP sleazebags. But they’re choosing not to proceed with those much-needed wage rises. Ergo message is: Pay rises are not cool (for you). Please vote for me next time. PS We are crushing your union. KThxBi

Blogosphere Erupts

Great Cartoon showing PM Credlin as a harassed child care worker in a crèche full of her front bench minions.