Economic and ecological crisis - a real alternative for the 90%

"Right now, in the real world, there are dozens, perhaps hundreds, of struggles of organisations of the 90% against what is being inflicted on them by the logic of the system and the governments who protect it. There is also significant and just discontent with the parliamentary system.

In each of these, to one extent or another, the members in the struggle express not just what they don’t like but also they demand something better...

Two big crises in the Australian economy: an “eco-economic crisis”

Each week new Australian and international information points to another economic meltdown as in 2007-9, and although for now the trigger and starting points are not known, the trend to a severe crisis is becoming clearer.

After ten years, economic “recovery” has been weak and has certainly not flowed to a big part of the working class - the 90%. For the majority, the system just staggers along, at best.

The Australian economy, due to the decisions of governments and corporations, is now a part of a globalised capitalist system. Therefore, no matter which government we have it must deal with the hand dealt to it by overseas developments. Government decisions will determine who gains and who loses when the next downturn or crisis hits.

However, since 2007-9 the climate change crisis has worsened, so badly that we have until about 2030 to stop it and start its reversal. We now know about the related collapse in biodiversity with all of its consequences. These will require significant government interventions in both spending and also new controls on capital and capitalists, at the very least.

Nature is a part of any economy. It is nonsense to think otherwise. The interaction between humans and nature is the economy, and we live in an era where there is a critical rift in that interaction. In important ways the two crises are interdependent as is the real solution that works for the 90%.

How to frame who is responsible for both crises, and how government should deal them, is a central dispute between the major parties, and the Greens, in the election campaign.

This will continue after the elections and will be a massive challenge for the left.

The causes and impact of economic downturn and the role of government

Economic downturns and associated crises are an intrinsic and regular feature of capitalist societies. They come along every several years in a cycle of growth and recession. You cannot have capitalism without them.

What is common to them all is that growth stagnates or recedes such that there are not enough profits (even when they increase) relative to the capital that has been invested, including through corporate debt.

Recessions do harm to the big majority of the population in two important ways. First, there is increased unemployment and underemployment, leading to downward pressure on wages. Wage cuts follow. The standard of living of the majority, the working class, declines. Nature is depleted. We are still yet to see the “recovery” from the last downturn in 2008-9 flow to the majority, but the system and its capitalist class have found themselves in an even stronger position in terms of wealth, income and power.

Second, recessions also challenge the various mass movements and campaigns of the people that are under way. In the past, these campaigns have retreated when crisis hits. They accept the logic of crisis - that “sacrifices” are necessary. The point in the future when a new deal is achieved is postponed. This can demoralise and demobilise the mass of people who are participating or about to participate up until when the crisis hits. Historically, these campaigns have fallen into a defensive posture when crisis hits, opening the door for fascism. This must not happen this time.

How would a re-elected Morrison government handle the crises?

The LNP policy would as always be to make the 90% pay, supporting downward pressure on wages and pushing cuts to social services in health, education, public transport and welfare.

The Abbott-Hockey-Cormann budget, the first LNP budget after the last crisis, was an austerity budget when the global economy was thought to be recovering and aimed to inflict great pain in various ways on the 90%. They sought to speed up the recovery in the form of wealth and income for the capitalist class and its hangers-on, at the expense of the majority.

There is no sign that a re-elected Morrison would do any different. In fact, they would go into denial in the face of it in order to justify business as usual to protect their rich and powerful corporate base.

Their neoliberal austerity would make both the 90% and also our natural world pay for the crisis. The situation would get worse and more rapidly.

How would Labor handle an “eco-economic” crisis?

The best clues can be found in what Labor did to handle the crisis it inherited (and did not create) in 2007-9 and also what it is proposing now.

First, to its credit, the Rudd Labor Government worked out quickly that the crisis was happening, that it was real and required government intervention. Labor handled the crisis in a different way to most other western governments. The USA, for example, shifted government controlled wealth to protect the profits of the big corporations and defended and protected the roll of corporate financial criminals whose deeds had triggered the crisis in the first place. Labor’s recipe was a mild government spending stimulus and protective measures – especially corporate bank finances – that softened the increase in unemployment and full on recession.

How foreign governments, especially the USA, will handle the next crisis, and how the next Australian government responds will be of great significance for the movements fighting against inequality and environmental destruction.

At this point in the election campaign Labor is acknowledging the prospects of crisis – the codeword is “economic headwinds”. Their obsession with a budget surplus and government debt reduction is justified as necessary for dealing with those “headwinds”. 

From a hypothetical Labor government we can expect the lowest possible “pump priming” it can get away with, as it did in 2007-9, with modest success. But will their proposed buffer be strong enough? The answer is probably NO, whether the two big movements to restore equality and rescue the environment like it or not.

How should the 90% deal with this?

The two most important movements for the 90% and for our natural world are the union movement’s Change the Rules campaign and the diverse forms of environmental struggle, especially for urgent climate change action.

The “eco-economic crisis” is a problem for the Change the Rules Campaign as it tries to rebuild workers’ power through new industrial laws that enable more effective struggles against wage stagnation.

It is a problem for the growing movement, now led by school children, to force a more rapid response from governments to stop and reverse climate change.

It is also a problem for those who are seeking to improve the social wage: raising the unemployment benefit above the poverty level; ensuring sufficient government spending on disability services, health and hospitals, schools, early child good education.

It is a problem for First Nations People who seek a new voice in Australian politics and self-management powers to develop their communities based on their knowledge and control over the resources that are provided for them by government.

It is a problem for the movement of people that want greater democratic control over the banking and finance situation.

And, it is a problem for all of us who see the inadequacies in the current parliamentary system. 

These great movements, at this time, are not alert to the implications of economic downturn dovetailing with the ten-year window for climate change reversal. Traditionally, economic downturns push such movements backwards. This cannot be allowed to happen this time around. These struggles will need to intensify, including under a Labor government, supported in some way by the Greens. But, critically, in a way that does not open the door for a return of LNP destruction.

Defeating the next crises is the business of mass movements, not just employers and politicians.

The rich potential within the current struggles of the 90%: an alternative programme from below

Right now, in the real world, there are dozens, perhaps hundreds, of struggles of organisations of the 90% against what is being inflicted on them by the logic of the system and the governments who protect it. There is also significant and just discontent with the parliamentary system.

In each of these, to one extent or another, the members in the struggle express not just what they don’t like but they also demand something better, including how much direct say they should have as a political force that is not constrained by parliaments as we know them.

Improving, consolidating and coordinating these demands will reveal a coherent alternative economic and political framework and logic. A people’s economic, ecological and political programme that is far better than the destructive logic of the present. There will be massive resistance to it from the corporations and their governments who would be weakened by it. 

Such a programme can grow and become more coherent in the actions of fighting for it with bigger and mindfully militant, determined mobilisations of the majority.

Above all else, the twin crises of our time require an escalated and renewed effort to produce this coherent people’s programme and the struggles for it.


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