I read his article in full last night because I am having trouble sleeping and I usually find a good dose of politics does the trick. Alas Kev let me down. In part the fault is mostly mine since I was expecting Kev’s little essay to be some shocking communist manifesto given the reaction some people have had to it. Sadly it is anything but.
You see Kev is a conservative social democrat who central thesis appear to be very similar to ideas Hawke and Keating used to espouse, that is, that the ideal model for the modern nation state is one where the worst aspects of capitalism are tempered by state intervention. Exhibit one, today’s economic catastrophe bought to you by Messrs Greenspan and Bush. The solution according to Rudd, who quotes Keynes quite liberally, is fiscal stimulus and a bit of regulation to make sure this particular mess doesn’t happen again. To be sure, Kev takes a swipe at little johnny and a few others but really there is nothing new in his analysis. Greed was given free rein and now we pay the price.
Ok, you might be inclined to agree about the lack of deregulation that allowed for the current state of affairs but surely the question is not how to we keep propping up a system that continues to fail but rather when do we make systemic change so that such situations cannot arise? And it is this point that Kev and his team of writers are keen to distract the debate and why he deserves the conservative tag. Agreed, left to its own devices the capitalist system might crash rather spectacularly as all the funny money disappears out of the system which would have serious consequences for social order around the globe. So state intervention of the kind Kev and Barack are proposing should be seen not as some sort of remedy for a failed ideology but instead they should be seen clearly for what they are, bandaids to stem potential social unrest.
Indeed Kev alludes to this aspect in his essay several times when he makes references to the potential for a rise in political radicalism both from the left and the right if action isn’t taken to keep the whole ship of fools afloat. In doing so he is trying to paint himself as some sort of sensible middle of the road caretaker who is doing his best to look after all and sundry with a bit of emphasis on the less well of and the future generations. This might work for him but only if the economic collapse is relatively short lived which according to Keating is unlikely.
Paul was in good form the other night on Lateline but his prediction of a sustained recession in the US and presumably elsewhere is likely to find few friends despite the truth in his observations about where power is shifting in the world. The bottom line is that in today’s conditions, international debt is what is going to hurt the US and Oz. The US has in the space of a few decades gone from being the world’s biggest creditor to the world’s biggest debtor which cannot be healthy for a national economy. Here in little ole Oz our foreign debt to GDP ratio has continue to balloon. Like any other poor bugger we will be forced to put our hand out for more credit from somebody just to ease the burdens we have suddenly collected from our close friendship with the US system.
The big danger for Kev is not the sudden attack of ethics being suffered by the so-called liberals. His biggest headache is how long it takes for the new world economic order to take shape. The government can borrow for a bit but sooner or later the bills fall due and this is where Kev is failing the challenge. His investments in community housing and education are laudable if not long overdue but there are two very important issues that have been overlooked. As Mr Brumby is finding out in Victoria, people expect the government to provide power and transport systems that make life bearable. In splashing the cash directly into the pockets of tax payers Kevin is missing an opportunity to make some substantial investments in building real world infrastructure that would have short term benefits for employment and long term benefits in building national capacity. At least then the debts incurred today would have some offset tomorrow.
But Kev is a conservative. Building genuine state owned infrastructure that directly returns a benefit to its owners, the public, is much too close to tearing a few pages out of Mr Marx’ manifesto so we can expect to see more nanny-state politics in the near future.
