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The Australian political system and the scourge of Neoliberalism

By John Tomlinson - posted Wednesday, 11 November 2015

Since the mid-1980s Neoliberal economics has been ascendant. This philosophical approach to economic policy replaced Keynesian economics that had emerged in the wake of the 1930s recession. Keynesian economics and strong unions provided the mortar to build, in English-speaking industrialised countries, increasingly egalitarian societies until the early to mid-1980s. Yet as Keynesian economic thought became more influential, the seeds of its destruction were being sown by Friedrich von Hayek of The Road to Serfdom fame and other luminaries from the Mont Pelerin Society.

Milton Friedman, the most famous economist of the Chicago School, attended the first meeting of the Mont Pelerin Society in 1947. Perhaps he, more than any other individual, has pushed market-oriented Neoliberal economics the hardest. He was an advisor to the brutal post-Allende military dictatorship of General Augusto Pinochet in Chile.

The Mont Pelerin Society currently claims that it was established to "facilitate an exchange of ideas between like-minded scholars in the hope of strengthening the principles and practice of a free society and to study the workings, virtues and defects of market-oriented economic systems."


Such a sanitised explanation of the intention of the Society is a far cry from throwing suspected communists out of helicopters and the torture which occurred in the Santiago Sports stadium in the aftermath of the overthrow of Allende. It is a respectable distance from the "greed is good" mentality that led to the collapse of Lehman Brothers. It is a long way from justifying Wal-Mart's senior executive getting over one thousand times the salary of the average shop assistant in their stores.

The Society acknowledges that it had initial concerns with the industrial power of unions. But nowhere does it openly admit the role its supporters in crushing unions with all the thuggery that the forces of reaction can muster.

The Society accepts that it wanted to limit the size of the State. But unlike modern day Neoliberals and tough love sociopaths it does not explicitly state that it wants to destroy the income support systems on which single parents, people who are unemployed, those with disabilities and other low-income earners rely. This is the most pernicious agenda in the Neoliberal armoury.


Neoliberals don't really want to debate the real economic issues facing less-affluent people. They don't want to find the optimum amount that single parents need to bring up their children in ways that enhance their opportunities and their potential to subsequently contribute to the society in which they live. They don't want to provide enough money and resources to ensure that those without work can best be equipped to put themselves in a position to find work that is suitable to them. They wince at the idea that society provides those with disabilities the services, health care and other necessities that will allow them to live dignified lives. It is an anathema to them to suggest that people be provided with sufficient income to live in austere dignity without imposing a requirement that they take the first job offered.

Neoliberals are cheap skates who mean-mindedly force the less privileged to beg for their supper. There is little or no systematic logic in Neoliberal analysis. Abbott's signature policy was the most generous, to the rich, childcare policy in Australia's history. It would have paid some mothers $75,000 and other mothers little or nothing. It became unstuck in the wallowing seas of the post 2014 Budget. Treasurer Hockey was left with the most Neoliberal, most unfair, Budget in our history which Labor and the cross bench blocked, in large part, in the Senate.


Following the dropping of the signature policy we faced the spectacle of Liberal Ministers accusing women, who had accessed both employer and the existing government maternity leave provisions, of double-dipping. This compares with the silence surrounding ex-Labor and Liberal politicians being appointed as paid ambassadors to foreign countries and accessing their parliamentary superannuation simultaneously - so much for Hockey's "End of the Age of Entitlement" clamour.

Neoliberal inconsistency

Neoliberal economic analysis is so fraught with logical inconsistencies that it can't survive rational analysis. It is forced to rely on metaphor and mythology. It often boils down to an Alice in Wonderland scenario where things mean what Neoliberals want them to mean.

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About the Author

Dr John Tomlison is a visiting scholar at QUT.

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