Why write? My friend Dan, many years ago, said such activity could be helpful to aid the demystification of the class as part of the process of encouraging self-activity.
So why write about the budget? Because the budget is a central if not the key element in the organisation of how the state facilitates the accumulation of capital and the general reproduction of capitalist society.
It is then important that we understanding it as part of understanding the world we live in so we can overcome it.
If you look at the media you see a swirl of commentary and analysis that obscures rather than enlightens; a vast diversity of voices that for all their sharp disagreements all agreed on the very same and very narrow liberal and technocratic consensus. (It is this consensus that in the face of a small and brave act of defiance Tony Jones labelled ‘democracy’.) The media continues to be the classic ‘Ideological State Apparatus’ which works to both reproduce the dominant ideas of society and also our relationship to society – no matter how much we might try to join in on Twitter(Althusser 2008).
Within this tight ideological constellation two other mystifications are offered up. The first that of the Federal government and the Centre-Right faction of the political class is as follows: we have a budget emergency, thus unprecedented action must be taken to save the nation. The task of the National Commission of Audit was to do the work of producing the research to justify the claims of ‘emergency’ but also to offer such unpalatable solutions that when the actual budget is implemented the latter looks mild and acceptable. However as writers from Left Flank have been arguing on social media the government’s application of these tactics has been contradictory and incoherent as they are engulfed in the crisis of politics that typifies our current conjuncture.
Thus the government is finding they can’t rule by hyperbole alone.
On the other hand the arguments from the ‘Left’ in its various social democratic, socialist and activist forms has not been helpful. The Left makes two arguments: a) that the government has over-emphasised the size and impact of the debt; b) that social democratic politics of ‘Taxing The Rich’ would solve the problem and contribute to the creation of a desirable alternative society.
What’s wrong here? The government is certainly over-egging its case. Australian debt remains relatively small compared to global numbers. But it is an error to image that Australia isn’t facing a crisis of social reproduction – that is the global conditions of the economic crisis have created a situation in which the state is finding it hard to fund social services, is confronting the end of the mining boom and thus must change course to attempt to save capitalism. The room for some kind of ‘Tax The Rich’ politics doesn’t exist.
Despite its vast length the Commission of Audit makes a very simple, and correct, key argument. That in the context of the global economic crisis revenue dropped and expenditure increased.
That the two future scenarios that the Commission runs reflect its own ideological proclivities is true – in particular their desire to prevent both rising taxes and bracket creep. But in some ways it is too optimistic as the Commission expects good levels of economic growth. If fact what we are seeing is the end of the mining boom. Thus we need to combine the Commission’s prediction of rising costs for social expenditure due to an aging population with the very likely reality that slowing economic growth will mean declining revenue.
In short: the secular and global crisis of capitalism has impacted the state’s ability to fund social reproduction.
The Coalition’s strategy is then to reduce expenditure on social reproduction and thus push more of the costs of it onto the home and the wage (thus the paid and unpaid labour of the working class), to work to increase the supply of labour-power (hence the paid maternity leave scheme, tighter requirements for the disability pension and Newstart and the rising of the age to access the pension) and to stimulate capital accumulation through infrastructure spending. (We can use ‘home’ in two senses here: both the site of unwaged care work mainly performed by women and also as the main asset owned by workers. If the value of your home is included in assessing eligibility for pension then this will increase the pressure to sell the home to fund your after retirement – this also means less inheritances for kids.) Hockey made this very clear in his speech to The Spectator Australia.
Thus the Left is completely wrong when it moves from a critique of the government’s rhetoric to claiming that there are no challenges facing the financing of the state at all. It works to damagingly mystify our condition by once again shifting the blame for our predicament from the nature of capitalism as a global social order itself to ‘bad people and bad ideas’.
But this folly is compounded by the insanely quixotic ‘alternative’ budgets that the Left rushes to draft. Their common denominator is a call to ‘Tax The Rich’. (You can see examples of this argument from Green Left Weekly and prominent socialist blogger John Passant) Such arguments make two errors. They fail to understand what capitalism is and they fail to understand the very limited possibilities that currently exist within capitalism.
The ‘Tax The Rich’ approach seems to imagine capitalism as simply a society built around a large division of wealth. There is a small pile of wealth here, a big pile over there, the state needs some more so why don’t we take from the big pile to fund state programs as the big-now-smaller-pile will probably still be big enough to fund pretty good lives – they can afford it.
But capitalism isn’t simply a society of wealth division it is a society where the division in wealth arose out of the process of capital accumulation. In a capitalist society, despite is complexity and historical specifity, the key organising dynamic is the movement of value to valorises itself, to accumulate capital, to turn a sum of money into a greater amount of money. ‘Value therefore now becomes value, in process, money in process, and as such, capital’(Marx 1990, 256). M-C-M’ is the organising dynamic of our lives.
If the state was to raise taxes in a way that threatened the ability of capital to do this at a competitive rate then capital would simply move elsewhere: something relatively easy given the level of financialisation and globalisation of the capitalist economy. (Of course capital’s flight into liquidity works to shift and intensify the very internal contradictions it is attempting to escape) (Holloway 2003).
Thus if the fantasy scenario of the Left came true – a Left government that within capitalism raises taxes – the most likely scenario would be capital flight that throws the economy, and thus our lives, into chaos until policy shifts. The example of the Mitterrand government should be instructive (Panitch and Gindin 2013, 196-197). Such arguments fail to fully grasp the domination of capital, and how much of the broader terrain of our lives is our caught up in and organised by its endless movements.
‘Do we need any further proof that Capital is the Real of our lives, a Real whose imperatives are much more absolute than even the most pressing demands of our social and natural reality’(Žižek 2009, 80).
Of course such delusions rest on the following foundation: that for the Left the social democratic compromise of the post-WWII period defines so much of their horizon (socialism being for them public ownership plus workers’ councils). This ignores that such a compromise was only possible due to a specific historical conjuncture (the vast post-war surplus in the US, the threat and reality of class struggle, the hyper-exploitation of the Global South) and that this compromise was broken by us by the vast mass struggles against its limitations and restrictions (cf.Midnight Notes Collective 1992, Caffentzis 2013, Varoufakis 2011, Prashad 2012).
In our current conjecture this simply just isn’t on the agenda. Capitalism has no apparent room for reformism.
My argument might strike many as both confusing and demoralising – what then can do done?
In the context of the continual stagnation of capital, the risings difficulties of the state to fund social reproduction and the Coalition’s attempts to stimulate demand by sacrificing all for massive infrastructure investment we shouldn’t just let our lives become fodder. We can, and therefore we must, struggle. But it is idiotic and unhelpful to enter into these struggles arguing that the problem arises from the Coalition, from ‘neoliberalism’ or from the nastiness of the political Right. It is idiotic and unhelpful to enter into these struggles arguing that some kind of alternative within capitalism is possible, that a different government or set of policies offers any desirable or possible alternative. Rather we can see that it is a systemic and global crisis we face and a radically other form of society is the only viable possibility, however unrealistic that may seem right now. Fix your eyes on a ‘communist horizon’(Álvaro García Linera quoted in Bosteels 2011, 227).
Althusser, Louis. 2008. On Ideology. London New York: Verso.
Bosteels, Bruno. 2011. The Actuality of Communism. London & New York: Verso.
Caffentzis, George. 2013. In Letters of Blood and Fire: Work, Machines and the Crisis of Capitalism. Oakland, CA: PM Press.
Holloway, John. 2003. “Capital Moves.” In Revolutionary Writing: Common Sense Essays in Post-Political Politics, edited by Werner Bonefeld, 161-169. Brooklyn, NY: Autonomedia.
Marx, Karl. 1990. Capital: A Critique of Political Economy. Translated by Ben Fowkes. Vol. 1. London: Penguin Classics.
Midnight Notes Collective. 1992. “The New Enclosures.” In Midnight Oil: Work, Energy, War 1973-1992, edited by Midnight Notes Collective, 317-333. Brooklyn,NY: Autonomedia.
Panitch, Leo, and Sam Gindin. 2013. The Making of Global Capitalism: The Political Economy of American Empire. London & Brooklyn, NY: Verso.
Prashad, Vijay. 2012. The Poorer Nations : A Possible History of the Global South London, Brooklyn, NY: Verso.
The National Commission of Audit. 2014. Towards Responsible Government the Report of the National Commission of Audit Phase One: Commonwealth of Australia.
Varoufakis, Yanis. 2011. The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy. London & New York: Zed Books.
Žižek, Slavoj. 2009. First as Tragedy, Then as Farce. London & New York: Verso.