Goodbye Lucky Country



You’ve really got to wonder what we all thought would happen, writes Mike Dowson.

We had a lot going for us in Australia. Global conditions favoured us for a long time. Now that tide has turned. The boom years are over, and we are on the frontline of escalating environmental risk. But COVID-19 could be the catalyst for renewal, writes Mike Dowson.

It happened so fast it caught everyone by surprise. One day, change was impossible. The next day, it was unavoidable.

The runaway train of human consumption, hurtling to the terminus of planetary collapse, was jammed at full throttle. No one seemed able to find the brake. No one was looking very hard.

Streets, stadiums, and shopping malls teemed with people; office blocks and food courts filled each day from packed commuter transport and clogged roads. A spider’s web of shipping routes conveyed great chunks of the Earth from mines, farms, and factories in some places to McMansions, landfill, and shareholder returns in others.

The Anthropocene spectacle: an entire planet transformed by a single species, its commercial, industrial tentacles reaching into every ecosystem, its waste products spreading into the stratosphere and the deepest ocean trenches.

And so much haste. People rushing everywhere; to study, work, shop and socialise; to go on holiday and cram into cruise liners, resorts and amusement parks; striving for promotion, property and a comfortable retirement; many struck down along the way by unemployment, illness, suicide, or homelessness; some to a lonely death with bedsores and a blathering TV, their loved ones too preoccupied to visit.

And beneath the frenzy a creeping anxiety that something might be fundamentally wrong: dying reefs, poisoned rivers, burning towns; the omens of worse to come.

Is that what we wanted? Did we think carefully about our needs and design our societies to fit? Or did we just make the best of what was offered? And offered by whom?

I met a wealthy immigrant, retired and living in a big house on the North Shore. He didn’t believe in helping the poor. “Australia is a capitalist country,” he said. “If people don’t like it, they should go elsewhere.” But where were our poor supposed to go?

I heard a famous North American psychologist invited to explain how billions had been “lifted out of poverty”. The triumphalism of the question warranted some scrutiny it didn’t receive. What does it mean: “lifted out of poverty”? Had some benevolent agency whooshed them all from paddy field to penthouse? Or had they simply relocated from newly redundant farm labour to a sweat shop job confiscated from a better-paid American? And how is a psychologist qualified to explain this? But in any case, material progress is undeniable and for this the accolade went to our old friend ‘capitalism’.

A file image of Wall Street, New York. (IMAGE: Dave Center, Flickr).

Why not literacy, numeracy, sanitation, medicine, electricity, mechanisation, automation, communication, transportation, birth control, the rule of law, the scientific method or any of the myriad mostly public goods that capital had merely contrived to profit from? Why not the efforts of the poor themselves?

Yet somehow this boastful upstart ideology had laid claim in millions of minds, including some brilliant ones, to the entire history of human invention.

With private capital or without, material progress has always depended on certain kinds of people – scientists, engineers, willing workers, the carers who look after them, and the writers, artists and educators who make sense of the human experience for them. And the big accelerant was the cheap, abundant energy we obtained from fossil fuels which had reconfigured the global geopolitical chessboard until they became harder to extract and their consequences more deadly.

Technology powered by carbon was the genie which transformed the world. Private capital chipped in when there was a profit in it. And the profits were bigger once democracy and markets got the rest of us involved.

And like the Earth, we took it all for granted. Then the virus happened. Very quickly the physical distancing required to save lives brought many businesses to a standstill.

Just as quickly, the biosphere rebounded. Clear skies appeared above LA and Beijing; clear water in Venetian canals. Coronavirus deaths were offset by those not dying from pollution.

After years of being derided as alarmist on subjects like climate and water, scientists were in demand again. Medical experts stepped in to advise. The search intensified for a vaccine and treatments.

Human society responded too. People mostly accepted restrictions and upheld the law. Neighbours looked out for the elderly. Restaurants fed hospital workers risking their lives to treat patients.

But the ‘economy’ was another matter. Millions became unemployed; whole sectors collapsed. People already pushed into debt by rising costs and stagnant wages faced default on rent, bills, and mortgages. Abandoned furniture appeared on footpaths; long queues formed at Centrelink.

(IMAGE: David Jackmanson, Flickr)

Between a rock and a hard place, governments committed public resources to rescue private enterprises with a largesse considered preposterous only days before. The ‘magic money tree’ they had decried for generations appeared like the Cheshire Cat in conservative cabinet rooms. Environmental Armageddon and malignant poverty had been choices after all. But whose choices?

The dominant myth of our time professes that our wellbeing depends on this thing called the ‘economy’. But ask yourself, since you’re so dependent on it: do you really know what it is or how it works?

According to this myth, we must be willing to sacrifice the natural world if there’s a profit to be made by someone; mine the hills, clear the forests, drain the rivers. And our quaint ideas about society mustn’t get in the way either; in fact, there is no society; there are only individuals and their families competing to win; a nation of John Batman clones on the eternal frontier.

But when the virus struck, it wasn’t this ‘economy’ which came to our rescue. It was the plundered Earth, our ignored scientists, our under-resourced communities, and the governments we supposedly needed less of.

It wasn’t that essential goods like food, housing, energy, and medicines had suddenly vanished. But their provision had been conditioned on lifetimes of labour, debt and accumulation rendered suddenly unworkable.

In systems theory parlance, our ‘economy’ was a fragile system. Earth and human society proved to be resilient, and governments rediscovered the agency we grant them. But far from being a dependable servant, our celebrated ‘economy’ fainted at the sight of trouble and had us rushing for the fiscal smelling salts. Shouldn’t we have noticed this before?

If the virtues of the status quo seemed indisputable that’s because they were so endlessly promoted. Like hard work, low taxes and a government budget surplus, the myth of neoliberal capitalism’s inevitability depended on a perpetual public hallelujah chorus.

A single family ran most of our print media. Big businesses and unions funded our political parties. Our parliaments swarmed with corporate lobbyists. The billionaire-sponsored IPA groomed many of our politicians. Plutocrat-worshipping trolls and bots infested our social media.

News Corporation chairman, Rupert Murdoch.

Faced with system failure, most commentators brooked no alternative. They called for a return to ‘normalcy’, even with mass fatality; the same ‘normalcy’ which had made good jobs scarce, housing unaffordable, private debt untenable and climate catastrophe inevitable.

Why would we hurry back to a model which put us on the fast track to extinction when its returns were diminishing anyway? Growth had already tanked; wages were stagnant. And now we must sacrifice lives to prop it up?

For many people, the life of plenty in the land of the fair go persists only in fantasy and TV ads. Australia has changed in the last half century. Our population has doubled; over half of us were born into the neoliberal order of winners and losers, and nearly a third of us in other countries where shared prosperity was less typical. Wealth has concentrated at the top, and its sources have changed. While incomes for most people have languished, gains on assets have skyrocketed. Fewer of us own real estate, but those who do are much richer. We reward people these days, not so much for what they do, but for what they own. Jane Austen’s characters would not feel out of place.

The result is that markets are now detached from reality. Fund managers swimming in unattended super and the companies whose shares they gamble on have shifted priorities and executive rewards from business fundamentals to ‘market perception’. Old-style leaders who cultivated partnerships of customers, employees, and shareholders have been replaced by adepts of ‘market signalling’. Around the rich world, as neglected economies rot, hungry capital has piled onto speculative stocks and even bankrupt companies and fraudsters.

This ‘short-termism’ has infected our politics. Career politicians have invited foreign businesses to exploit our resources for a diminishing return of local jobs while importing foreign students and already affluent, educated homebuyers to prop up GDP and real estate values through sectors like new housing and construction which furnish party donors. Major industries have closed, investment in technology and productivity has declined and our economic diversity has fallen to the level of Pakistan’s.

And what did ordinary Australians do while this was going on? We flocked to ‘wealth’ seminars, where overnight millionaires shared the secrets of using the same population growth, tax loopholes and financial industry laxness to pocket some capital gains of our own.

In 1997, Robert Kiyosaki wrote the book which captured the new zeitgeist. Rich Dad, Poor Dad contrasts the author’s loser ‘poor Dad’ who made a modest living as an educator with a supposed ‘rich Dad’ mentor who taught him to amass passive income from assets. Proponents often call this ‘wealth creation’.

(IMAGE: Mark Bonica, Flickr)

But what wealth was created by the housing bubble? Where did the capital gain come from on a house sold for 10 times what it cost? It wasn’t the result of cleverness or hard work; it’s the same house. The buyer paid for the capital gain, in a situation of artificial scarcity. Perhaps one of your children or grandchildren paid for it, or one of the many Australians now getting by on lower real wages with more debt and less job security in an economy drained of its lifeblood.

That wealth wasn’t created, it was transferred; from productive enterprise to asset price inflation; from the imperilled future to the reckless present. As the beneficiaries and their offspring, many in mundane occupations, ascended to relative affluence, their political allegiances shifted. You can see it in the numbers from the last federal election. While age has always leaned conservative, the factor which now keeps the LNP in office is property ownership.

One young woman from a wealthy family said to me ingenuously, “But don’t you think that poor people are just lazy and stupid?” Another, herself from a disadvantaged minority, but having scored a good job and a foothold on the property ladder, explained her swing to the right by saying: “Look, I know they’re bastards, but they’re good with money”. Whose money did she mean? Not our scandal-ridden public purse, surely? No, she meant hers. She voted for lower taxes and a rising house price; at least she believed that’s what she’d get.

And this was no accident. The high immigration and tax concessions which fuelled this bonanza were mostly a legacy of the Howard era. But the idea goes back to Robert Menzies, who planned to lure voters away from socialism by making sure they had a lawn to mow. And the home buyer scheme he employed came from none other than the young John Howard.

What happened to our beloved ‘titans of industry’? Today you’ll find them with Captain Cook and the Anzacs. Apart from some celebrity entrepreneurs, they have joined a peculiar down under pantheon whose job is to lend dignity and gravitas to national ambitions which are now little more than get-rich-quick schemes. If they are heir to anything, it’s the faux nobility of the colonial squattocracy. Because the truth is in practice we stopped caring long ago about our local industries and egalitarian traditions.

Decades of this feeding frenzy left our ‘economy’ in a parlous state even before the virus. The heroic budget surplus, which appeared all over the media without ever existing anywhere else, told us nothing about the health of the country. It was a signal to Howard’s beneficiaries that their investment windfalls were a just share of a bigger success story; it was pure snake oil.

This was no condition in which to face more boom years, let alone a pandemic. But even that will be dwarfed by what is to come. What American implosion doesn’t do to the world economic order climate disruption will. The arctic is on fire. If that fact doesn’t cause concern then conscience and common sense have abandoned us. Applying a national effort to a ‘gas-fired recovery’ is like sending our youth to a beach jamboree in the path of a tsunami.

Fires burning on Kangaroo Island, January 2020. (IMAGE: Chris Graham, New Matilda)

It turns out that frogs don’t remain in water while it boils. And ostriches don’t bury their heads in the sand. These are metaphors for uniquely human behaviour.

In Australia, our opportunities were so huge, our circumstances so fortuitous, and past generations of progressive reform so effective that even after decades of political vandalism we still have a long way to fall. It’s not only possible but common to have lived a whole life here and remained oblivious to escalating risks.

But we aren’t going ‘back to normal’. The virus isn’t a temporary setback; it’s the trigger for a collapse prescribed long ago by partisan economic policy. Looming recession is now so obvious even economists can see it. And environmental calamities are lining up ahead of us; the bushfires were a taste of things to come.

There are possible responses which are relatively benign, but they are not the default ones. Buoyed by our pandering media, the federal government plans to liberate big business from environmental law, reopen the immigration flood gates to replenish real estate and construction, and continue stripping public services under the guise of paying off ‘coronavirus debt’, while making it harder to find out what they’re up to and object to it.

Australia now has a large cohort of ‘rich Dads’, not entirely old and male, and many only ‘rich’ on paper or in comparison to the falling median, but hanging on to what they’ve got and feeling some affinity with creeping authoritarian kleptocracy if it helps them do it. Perks are easy to grant but difficult to revoke.

This is no longer The Lucky Country, even in the ambiguous sense inferred by Donald Horne. But I don’t think luck is what we need.

We need to transition from an ‘economy’ which is fragile, exploitative and serves a diminishing few to one which is resilient, regenerative and works for all of us. That can happen as young people step forward, find common purpose, organise, and mobilise for the kinds of opportunities their predecessors took for granted.

Social change is usually generational; and arriving generations face more than their share of challenges. The ‘poor Dads’ and any other Dads, Mums, and people of goodwill should help them any way we can.

Mike Dowson

Mike Dowson writes regularly on politics, public policy and the economy. He works with local organisations and leaders of the global cooperative movement to nurture emergent systems for a liveable future.