ARPA: Market populism in Australia

In 1944 when F.A. Hayek rushed out his first major attack on the welfare state, The Road to Serfdom, he was a lonely figure. The idea of the welfare state, as set out in the recent Beveridge Report, was wildly popular as the post-war election results showed. Today this situation has been reversed. Supporters of the welfare state are denigrated as new class elites or special interests, contemptuous of mainstream values. The idea that any defence of welfare is a self-interested elite activity is itself now mainstream. This idea is propagated in books like David Flint’s Twilight of the Elites (2003) and even by serious political journalists like Paul Kelly of The Australian (Scalmer & Goot 2003). How did all this happen?

Hayek’s ideas have been transmitted by several mechanisms. Perhaps the most important are the free market think tanks designed specifically for this purpose (Cockett 1995). In the United Kingdom, the Institute of Economic Affairs was established in 1955; the Fraser Institute in Canada and the Centre for Independent Studies in Australia followed in the 1970s. The role of these think tanks is to sell the ideas like soap, through constant repetition, repackaging, and re-endorsement. One of the best salesmen associated with these think tanks was Nobel Prize winner Milton Friedman. Free to Choose, the book he wrote with Rose Friedman, became a run-away success. So did the television series Yes Minister, devised by Tony Jay, who was close to the Institute of Economic Affairs.

Of course none of this political marketing would have succeeded without external events, such as the international economic crisis of the mid-1970s and the apparent incapacity of Keynesian tools of economic management to deal with the ensuing ‘stagflation’. Market populists went on the offensive with their solutions of winding back government interference with market mechanisms. In Australia such ‘economic reform’ did not really take off until the Hawke government introduced financial deregulation in the 1980s.

At the same time, insecurities produced by a global economy helped stir the kind of resentments that encourage traditional populism, manifested in Australia during the 1990s by Pauline Hanson’s One Nation. Traditional populism interprets the world through an ‘us and them’ frame and seeks to mobilise the people (us) against untrustworthy cosmopolitan elites (them). At this time the full brilliance of the market populist strategy was revealed. Market populists ridiculed One Nation for its naïve economic nationalism and opposition to free trade and competition policy. However, they appropriated its ‘anti-elitism’, shorn of its hostility to banks, big business, and international financial elites.

The ‘great divide’ was now between liberal elites and the mainstream. The campaign promoting John Howard’s 1988 political manifesto, Future Directions shows how this could be done. The campaign jingle Bryce Courtenay composed included the lines:

The sources of such market populism are twofold. In part they derive from the idea of a ‘new class’ developed by American neo-conservatives in the 1970s and promoted by influential elements in the Republican Party. The new class consisted in university graduates who had been radicalised by the social movements of the 1960s and who had moved into positions in the public sector and communication industry. They had a vested interest in the expansion of the public sector that provided them with privileged positions as definers of values. Damien Cahill (2003) has shown that the journal Quadrant, with its close connections to American neo-conservatism, introduced these ideas to Australia. In March 1989, Quadrant editorialised that the new class with its values of environmentalism, feminism, and multiculturalism had replaced totalitarianism as the major threat to freedom. The idea of the new class fused readily with populist anti-elitism. ‘New class elites’ became the object of attack. Christopher Lasch (1995) assigned these new class elites an additional key characteristic: they were contemptuous of the values of ordinary people or of the ‘mainstream’, as John Howard called them.

Another major source of the language of market populism derives from public choice theory, as developed in the United States from the 1950s by figures such as James Buchanan and Gordon Tullock. Public choice theory did not appropriate, as had the neo-conservatives, the quasi-Marxist idea of a class defined by ownership of cultural capital and with a class-interest in maximising redistribution from wealth producers. The public choice school is neo-liberal rather than neo-conservative, taking over the idea of the utility maximising individual from neoclassical economics and applying it systematically to all collective and institutional behaviour. As Hayek had said, social justice was a mirage, and those who purported to be pursuing the public interest were really ‘special interests’. Equality-seekers were rent-seekers, calculating they could do better out of the state than out of the market. They were people who would do well out of equality. Public choice theorists discarded the term ‘welfare state’ as too positive, replacing it with terms such as the ‘overloaded state’, the outcome of a cosy conspiracy between budget-maximising bureaucrats and their clients. Similarly, they replaced terms such as non-government organisations, community groups, or public interest groups with the now ubiquitous term ‘special interests’.

New class theory and public choice theory have different intellectual origins, but they are drawn together within market populism. Market populism denies any legitimacy to the central value of the welfare state: equal opportunity. The liberalism that inspired the welfare state was based on T. H. Green’s 19th century critique of the oppressive effects of freedom of contract in conditions of inequality. Green regarded ideas of negative liberty as more appropriate to an earlier era, when the absolute monarchy and the aristocratic state was the main threat to freedom. His new idea of positive liberty advocated public intervention and social provision to ensure everybody had the means to realise their potential. This ‘social liberalism’ prioritised equal opportunity over freedom of choice, when the latter was at the expense of the former. By contrast, in the current era, multimillionaire talkback radio hosts encourage resentment of the elite busy bodies who insist on ramps for the disabled at the taxpayers’ expense.

The market populist worldview dismisses concern with equality of opportunity or human rights as the ideology of the new class or special interests, who speak in the name of equality but create privilege for themselves and welfare dependency for others. Interestingly, the core members of this supposedly privileged new class, defined by their concern with the environment, human rights, and so on, are the underpaid members of feminised professions like social work, teaching, and librarianship. Apparently the new class is predominantly female, unlike more familiar elites that would not admit women to their clubs. Just as market populism attacks the welfare state by describing it with female metaphors like the ‘nanny state’, so it conjures up a feminised elite while (masculine) business elites drop right out of sight. Professor Flint (2003, p.1) tells us that the elites suffered a devastating defeat in the 2001 federal election, gaining only 10 per cent of the national vote, and mainly in inner-city electorates. It seems that all those teachers and librarians voting Green or Democrat were part of an unsuccessful elite grab for power.

Not only are equality seeking and concern for the environment part of an ideology disguising vested interests, they also express the contempt in which new class elites hold the rest of us. Columnists in the Murdoch press tell us every day that elites sneer at, look down on, and despise ordinary people. You may find it hard to think of examples of social workers and teachers sneering at ordinary people, but deep down that is what they are doing. Katharine Betts (1999, p. 81ff) warns that although their calls for increased welfare expenditure might make the new class seem sympathetic to working class interests, ‘at bottom’ they are contemptuous of the materialism and parochialism of the working class. When they are not lecturing the electorate to accept asylum-seekers, elites are wincing at ‘basic Australian values’.

The Prime Minister himself has told us that elites engaging in ‘black-armband history’ are displaying contempt for the national pride felt by ordinary Australians and that feminists promoting equal opportunity are showing contempt for the values of ordinary women. He has spoken on talkback radio of the ‘stridency of the ultra-feminist groups in the community’ that sneer at and look down on women choosing to provide full-time care for their children. The same Prime Minister has resisted feminist campaigns to restore the time-use survey, which charts the unpaid work men and women do inside and outside the home, to its status as a core social survey conducted every five years. But who needs evidence when trying to mobilise political emotion against equality seekers and their values? Certainly not the Prime Minister’s interviewer, Alan Jones. As Steve Mickler (2003) has shown, the genius of talkback radio hosts lies in how they represent themselves as on the right side of an elite/mainstream divide, and not in their investigative skills.

So concern for equal opportunity is a form of contempt for ordinary people or simply an elite fashion that helps the elite distinguish themselves from unfashionable ordinary people. John Howard (1995) has referred to race, gender, and sexual preference as the ‘designer forms of discrimination in the 1990s’. Of course they are also part of that political correctness imposed by the elite, the ‘thought police’, or ‘tyrannising minorities’.

But in the eyes of populists, elites are guilty of more than just self-seeking and contempt. Populists also raise doubts about elite commitment to Australia and to national sovereignty. In league with like-minded international bureaucrats in Brussels, Geneva and New York, some of them Australians, elites seek to interfere with elected governments and impose norms and standards (such as on the treatment of asylum seekers) that the electorate has rejected. In the words of Professor Flint—himself educated in Sydney, London and Paris—they want us to hand over power to international elites.

Yet populists also condemn elites and special interests for not wanting us to hand over power to Monsanto or to international pharmaceutical companies, through instruments like free trade agreements. Martin Mowbray (2003) has pointed out that the free market think tanks have stepped up their attacks on non-government organisations since the international mobilisation against the Multilateral Agreement on Investment. No wonder traditional populists sometimes get confused, when they are told that international elites are only those upholding human rights treaties, not those moving companies off-shore or insisting on the introduction of genetically modified crops.

Regardless of such confusions, anti-elitist discourse is serving its purpose. It has normalised a view of the world where there are no divisions between capital and labour or north and south. The only division is between elites selfishly pursuing a social justice and environmental agenda and ordinary taxpayers who just want to pay off their mortgage. The success of this strategy has been quite remarkable, considering that Australia is still a democracy and the majority do have an interest in welfare state protection from lifecycle contingencies, an equal start in life for all children, and a future that is not blighted by environmental pollution and degradation. The majority cannot have an interest in punitive regimes for market losers, because we are all increasingly vulnerable to this fate. No wonder women are so disinclined to have babies—there is nothing like motherhood to put one at risk of being a market failure. Perhaps the nurturing state was not such a bad idea after all.

REFERENCES

Cahill, D. 2003, ‘New Class Discourse and the Construction of Left-Wing Elites’, in M. Sawer and B. Hindess (eds), Us and Them: Anti-Elitism in Australia, forthcoming.

Cockett, R., 1995, Thinking the Unthinkable: Think-Tanks and the Economic Counter-Revolution, HarperCollins, London.

Howard, J. 1995,‘ The Role of Government: A Modern Liberal Approach’, The Menzies Research Centre National Lecture Series, Canberra, 6 June.

Howard, J. 1998, Transcript of radio interview with Alan Jones on 2UE, 16 March.

Lasch, C. 1995, The Revolt of the Elites: And The Betrayal of Democracy, W.W. Norton, New York.

Mickler, S. 2003, ‘Talkback Radio and Anti-Elitism: A Fatal Paradox?’, in M. Sawer and B. Hindess (eds), Us and Them: Anti-Elitism in Australia, forthcoming.

Scalmer, S. & Goot, M. 2003, ‘Elites Constructing Elites: News Limited’s Newspapers, 1996–2002’, in M. Sawer and B. Hindess (eds), Us and Them: Anti-Elitism in Australia, forthcoming.

Mowbray, M. 2003, ‘War on non profits: “NGOs: What do we do about them?”’, Just Policy, no. 30, pp. 3–13.

Marian Sawer is Professor in the Political Science Program at the Research School of Social Sciences at the Australian National University. She and Professor Barry Hindess are co-editors and contributors to the forthcoming book, Us and Them: Anti-Elitism in Australia (API Network, Perth).

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View other articles by Marian Sawer:

Creating Space for Democracy (Digest, Oct 2013)
Managing Gender: The 2010 Federal Election (Digest, Oct 2010)
The Case for Liberal Women (Digest, Feb 2010)
How Democratic are Australia’s Elections? (Digest, 3 Sep 2004)
Making Democracy Safe for Students (Digest, 26 Aug 2002)

Down with elites and up with inequality: Market populism in Australia

REFERENCES