Thursday, 1 May 2014

On the Commonwealth

Over the last week or so I have been reading about the Australian Government Commission of Audit and the upcoming budget, which by all accounts is reckoned to be a horror story in the making for the common man.

What I have read about the commission of audit recommendations fills me with dismay, it is a narrowly focused set of findings based on the principle that Government has no place in service provision and market forces are best. In my view this is wrong on so many levels that I don't really know where to start.

Now correct me if I am wrong in any of this. A government is elected to serve the country and the people of the country. Not just one sector but all the countries peoples.

Governments - be they state or Federal exist to govern and provide essential services that pull a community together and give a common direction. Or at least a direction that the majority can agree to.

Australia is a Commonwealth, a federation of the states and territories. They banded together to build a stronger Australia as a Nation. The concept of a federation and a commonwealth is one of common purpose and mutual assistance. States and Territories are not competitive market driven entities, and should not be forced into such a role.

Have a think about the word Commonwealth. Yes sure it means an aggregation of entities into something larger. But the origins of the word are "the common good". That's right the common good, in other words to safeguard and improve the lot of everyone, the common wealth.

I am no economist, but I can see that pushing current federally provided services out to states to run competitively  (on a business footing) does not make sense. Doing this will create winners and losers across the country for no other reason than where you live. Larger or more populous states will have the economies of scale to provide good services. Tasmania, Northern Territory, ACT and probably South Australia will be disadvantaged. And it's not as if you can walk around the corner to another "shop". You would have to move state. Sure people do that all the time, but not everyone can or wants to and for every "economic refugee" this creates the worse the lot of those remaining will be. Less people, less money, less services and thus a downward spiral.

I guess the thing that gets my goat is just how narrowly focused this commission of audit is and how one sided the proposed solutions are. An audit by a self interest group for a self interest group.

What we are seeing in Australia (and other countries) is the effect of an entrenched political class. People who view politics as a profession and an end in its own. The loyalty is to the party, not the people and the country as a whole. What matters are the deals and interest groups that provide the patronage. If you don't belong to the party or support the party then your interests don't really matter.

I don't doubt that many people enter politics out of a sense of public duty, but somewhere along the way the majority give the impression of having lost that focus.

Of course the two party preferential system doesn't really help things either. Successive legislation has entrenched the existing parties, making it difficult for other parties to gain traction. And of course when a threat to the existing order comes along the two parties close ranks to negate the "common enemy".

To jump around a bit. Over the past twenty plus years I have watched as a succession of economically driven policies have divested Australian Governments of a range of Government business enterprises and sold off public assets. I am sure there is sound economic theory behind this. But by doing so the Government's ability to affect the market place without legislation was lost, and the revenue base narrowed to simply taxation.

The same and similar economic theories have also narrowed Australia's range of economic activity. The loss of the car industry being a great example of that. Throwing up another set of disused factories in Australia's industrial wasteland. Victims of a sort of scorched earth approach.

I have to say that a community is not a corporation. Business is a part of it. But a community is and should be about people, their wants and needs and ensuring that we use and distribute our wealth equitably. By any objective measure that is not happening now.

Yes our captains of industry are doing well - for themselves. Just watch the business councils antics whenever general wage rises are proposed. Then watch their antics as they propose executive remuneration increases, that are completely out of kilter with the rest of society.

And what of the people in our society who are suited to manufacturing positions? Oh too bad they got left behind because they couldn't re-skill or weren't suited to another role. Australia used to have a well rounded economy, now? By my reckoning our economy is becoming increasingly hollow as manufacturing shuts down and service jobs are off-shored to wherever is cheapest.

Where to Australia? Is Australia may be a commonwealth, but where is the sense of Common Wealth?

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