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Swan's appeal hits egalitarian nerve to triumph over political taboo, The Australian, 13 March 2012

By Dennis Glover, Per Capita Research Fellow

The Australian, 13 March 2012

The vitriolic reaction from the political Right to Wayne Swan's The Monthly essay demonstrates as nothing else could that a new political correctness is trying to force itself on an unwilling Australia. At its core is the following proposition: that the connection between economic class and politics is now a taboo subject for our democracy.

Two things give away the fact we are dealing with a taboo. The first is the volume of the personal scorn that has been heaped on the Treasurer. "Ignorant", "bitter", "chippy", "unqualified to comment on business matters" and "Fabian bugler" are a few that come to mind. Those who utter heresy are often burned at the stake.

The second is the substitution of slogans for argument. Without even reading his article, Swan's opponents responded with their predictable and prefabricated slogans. He was preaching "class warfare" and "the politics of envy", as "opposed to wealth creation", and has a destructive urge to "divide the pie, not grow it". Ho hum.


But here's the truly interesting thing: Swan's essay also unleashed a torrent of furious agreement from ordinary Australians. It trended No 1 on the national Twitter feed, clogged talkback, drew hundreds of responses in online forums and filled column after column in the letters pages of the newspapers.

Labor branch members are ecstatic for the first time since about 1993. This isn't just because Swan's argument is novel and brave, and an example of a politician having the balls to take the battle of ideas seriously for a change, which everyone loves. It's because they agree with him.

To use what is perhaps an apt analogy, it's as if Swan has drilled down beneath the brittle outer crust of the nation's political consciousness and struck a gusher. Finally, people have been reminded that it's OK to say that economic policy and social responsibility should be linked.

Unlike most economists and commentators, ordinary people find it quite easy to grasp the simple proposition that the interests of the super wealthy are not necessarily always the interests of the whole nation. It's a proposition that passes the pub test but not the boardroom test. It's not anti-business or anti-capitalist; it's simple common sense.

It's also an idea with a long intellectual heritage. There is a common misconception that the link between extremes of wealth and political conflict began relatively recently, with the rise of Marxism and socialism. In fact, this idea goes back to the birth of politics itself and is the foundational idea of the very concept of democracy, people power. Swan quotes Francis Fukuyama to this effect in The Monthly. He's right. To suggest that in the past 30 years of economic reform we've managed to outgrow an idea that has been around long before the Bible is nothing short of hubris.

Interestingly, this contemporary taboo about mentioning wealth and political power in the same sentence is a peculiarly Australian one, because in other nations discussion of the role of money in politics and the damaging effect of widening economic inequality on democracy is commonplace. As Swan made clear in his recent address to the National Press Club, his immediate inspiration came from his summer holiday reading of similar debates in conservative publications such as the Financial Times and (Bob Carr's favourite journal) Foreign Affairs. So Swan's thesis, considered incorrect by his critics, is actually the same as that put by the editorial writers of the world's most respected financial and policy publications.

Like the Financial Times and Foreign Affairs, all Swan is arguing is that the best way to ensure the ongoing legitimacy of the free market is to ensure the wealth it generates is spread a little thicker. Australia's self-styled free-market liberals, not Labor's Treasurer, are the ones who are falling behind contemporary global economic thinking, and Australians who follow overseas debates are fully aware of this.

But Swan's surprising appeal has another explanation: he has made an argument that has a deep and enduring place in the nation's emotional make-up. Swan has managed to tap a folk memory handed down to us by our parents and grandparents of Australia as a country where egalitarianism matters. It's there in Swan's own family story, which he recounted in part at the National Press Club last Monday.

His grandfather, a World War I veteran, was gassed at Messines, died young of his injuries and had his family thrown off its soldier-settlement block during the Depression. As Swan tells it, this experience turned his father, a World War II veteran who saw action in the Pacific, into a sceptic of authority who devoted his life to serving his sugar cane farming community. It's what motivated Swan to take up the Labor cause.

In the light of this, what do we make of the Swan who is suspicious of billionaires running multi-million-dollar public relations campaigns? Is he simply embittered and chippy and against the prevailing wisdom? Or is he, in crucial ways, typically Australian? To most of Australia's economists, incapable of seeing beyond averaged aggregated economic statistics, and unable therefore to think that any criticism of our GDP-boosting mining magnates is legitimate, the answer is easy: Swan is a loser with a chip on both shoulders.

But to most Australians who exist in a world filled with wider social, political and economic meaning, and whose lives are informed by memories, emotions and ordinary human sentiment, Swan's The Monthly article has powerful appeal that no amount of political correctness can suppress. That's why it's popular.