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Abbott’s “The Invisible Hand” Has Someone’s Fingerprints All Over It!

“By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.”

Adam Smith. 5 June 1723 – 17 July 1790

 

We were promised a STRONGER economy and NO EXCUSES government.

So, of course, when the unemployment rate was the worst in over a decade, we were told that it was Labor’s fault. Not mind you, for the ENORMOUS debt, but because they were holding up the Coalition’s Budget in the Senate.

It sounds good, if it weren’t for the fact that some of the things that Labor blocked were actually going to eliminate jobs.

But most of those, of course, would be public sector jobs, and, as we all know, they don’t count. Although work-the-dole is a good thing.

The Liberals have quite a simple economic strategy: If you reduce the size of government, then you make it possible for the private sector to grow. And once you get rid all the unnecessary red tape, then business will flourish. Adam Smith’s “invisible hand” will take over and the economy will run smoothly.

It’s an excellent theory which only has one flaw. (I’m speaking from an economic point of view. From a social point of view it has many. Of course, from an economic point of view, the freeing of the slaves after the American Civil War led to an immediate drop in the capital assets of the United States because slaves went from being a commodity that you owned, to people. And people have no value whatsoever! The assets of the South dropped by more than half overnight.)

In the eyes of a politician, I’m not even sure that they’d consider its flaw of any importance, but I feel that it’s worth mentioning: It doesn’t actually work!

There are some excellent books I could refer you to for evidence of this. For starters you could read, Paul Krugman’s “End This Depression Now”, John Quiggin’s “Zombie Economics: How Dead Ideas Still Walk Among Us”, John De Graaf & David K. Batker’s “What’s The Economy For, Anyway?” and anything that Jonathan Ralston Saul has written.

But, as Joe Hockey and Tony Abbott would say, just trust me.

The fundamental problem is that there are two possible explanations for our current situation. The first is that they have no idea what they’re doing because they’re as stupid as they appear and the second is that they’re trying to rebalance things so that – like the USA after the Civil War – we don’t lose all these assets by treating the slaves as people rather than as an asset to be sold and exploited.

Of course, the first is the kindest explanation. Either way, let’s look at what they’re actually telling us.

  • Only successful companies which can manage without government assistance should get government assistance.
  • It doesn’t matter that many companies are moving their operations overseas – in spite of Adam Smith, the oft quoted guru of laissez-faire capitalism suggesting that we’d buy local rather than foreign – because there’ll be plenty of jobs once the economy is fixed.
  • The cost of living is too high and you’re all struggling. But you ARE paid too much if you’re on the minimum wage.
  • It’s not up to the government to work out where the jobs will come from, but we can tell you where we don’t want them to come from. (See Kevin Andrews for further information)
  • We believe in small government, but we believe that the government should suck more out of the economy in revenue than it puts back in services. (Also called a Budget SURPLUS.)
  • Companies should be taxed at a smaller rate (29%) than someone on $110,000.
  • We don’t need to manufacture ships or submarines in Australia, because it’ll be cheaper to put these people on a work-for-the dole scheme and pay some foreign workers to do our manufacturing.
  • Poor people don’t drive.
  • White men can’t jump.
  • Racist stereotypes may not be accurate but they appeal to a certain demographic.

Ok, I’ve sort of lost the plot. I’m rambling. I could do an interview and pretend I’m a Liberal Minister.

But the fundamental point remains. They are asking us to stick with this idea that we live in a world where nothing is changing and that unemployment is just a result of a sluggish economy and once everything is back to normal – you know, now the adults are back in charge, the ones who are meant to be ruling – then the jobs will return.

But not for those in the industries who have moved overseas.

That’s why it’s important to retrain so that workers can be involved in the industries of the future. (Like coal mining?)

Strange then, that they’re making it so hard, by things such as deregulating universities and their state counterparts are reducing funding to TAFE.

Like I said, the kindest interpretation is that they are all as lazy as Christopher Pyne who didn’t even read the Gonski Report.

 

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10 comments

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  1. David Linehan

    Ah Rossleigh your column never disappoints, you stir the blood of a good Labor man 🙂 Dinner will go down well.

  2. Phi

    Have to agree. They are as stupid as they look.

  3. Shevill Mathers

    …Like I said, the kindest interpretation is that they are all as lazy as Christopher Pyne who didn’t even read the Gonski Report…

    You took the words right out of my mouth. I have maintained all along that the present government are taking the easiest possible way out. They have as far as I can tell, not created one positive idea, eave a thought about how to create jobs and new industries in Australia. As you rightly say, it is easier to get our hardware built overseas, rather than have to handle trivial questions.

    A totally destructive government who are leaderless and clueless.

  4. Terry2

    Interesting how Abbott and Morrison have allocated 4000 positions for refugees from the Iraqi Yazidis minority group to resettle in Australia : no mention, however as to what this government are going to do with the asylum seekers currently locked up on Christmas, Manus and Nauru Islands.

    So far the mainstream media have not picked up on this anomaly although Clive Palmer this morning spoke out on the ongoing incarceration of these people. Odd how Clive has become our national conscience.

    I would suggest that the resettlement of Yazidis is just political spin and none will actually be brought to Australia : watch this space.

  5. vivienne29

    Yes Terry2 – surely the Yazidis should go and form part of that orderly queue!

  6. townsvilleblog

    Ross, I find it particularly interesting that Labor had unemployment at 5.2% with a price on carbon (the tories said it was a job destroying tax), yet the best that the conservatives can do without a price on carbon is 6.4% If only the ALP had the courage to democratize itself and rid itself of the dominance of the AWU/SDA faction.

  7. David Linehan

    Another stunt to show the world who are learning of Morrison’s evil imprisonment of legal Asylum Seekers, they are being good citizens. Whether they do or don’t, it is all too late. Nothing will wipe the memory of the torture of mind and body inflicted upon those on Manus, Nauru, Christmas Is and in camps on the mainland.
    Not forgetting the move towards sending 1000 to Cambodia and its murdering Govt. No Morrison you will never cover up the evil persecution you have condemned innocents to endure. With the full backing of the Catholic Seminarian Abbott.

  8. mars08

    The most important thing is that the Iraqi Yazidis pledge to be loyal members of Team Australia. Well… it seems that sooo many foreigners (maybe, perhaps) aren’t sufficiently embracing straaayn values! Ungrateful buggers!!!

    Our Major Debacle reckons… “What we need to do is to encourage the moderate mainstream to speak out…” Because otherwise you just don’t know what they are thinking!!!!

    What an unscrupulous, scum-sucking, self-serving, hate-mongering douchebag!!!

    http://www.smh.com.au/federal-politics/political-news/you-dont-migrate-to-this-country-unless-you-want-to-join-our-team-tony-abbott-renews-push-on-national-security-laws-20140818-3dvbx.html#ixzz3Ahy4iTHh

  9. abbienoiraude

    “….because slaves went from being a commodity that you owned, to people. And people have no value whatsoever!”

    Sums up the Conservative ideology perfectly.
    People, in their view, especially the poor, disabled, needy, homeless, unemployed, have no value in the land of LNP Governance.

    (Johnathon Ralston Saul has been trying to educate us for years….we ignored him at our peril, where we are at now.)

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