Romance in Politics – the Public Good
When Paul Keating encouraged me to accept your kind invitation, he told me, “They are a romantic lot, most of them are old lefties, their hearts are still in search of a better world”. He reminded me that Mahler was a social democrat at heart.
I can recall from my youth that our literary and artistic giants had a slight political bent – Frank Hardy, Katherine Susannah Pritchard, Mary Gilmore, Robbie Burns, Paul Robeson, Henry Lawson, Charles Dickens, John Steinbeck.
However, as the Romantics might have their politics – so politics has its Romantics.
It is a great pleasure to give this lecture – the John Button Oration.
The essential case I seek to make out is the case for the Romantic in politics. There is no better banner to do so than under the name of John Button. The Romantic here is defined in the sense that it is applied to Keats, Byron and Shelley of “a belief in some positive ideal of good”. It was said of Keats that “He had the power of putting a spirit into life so that the world is not dead or so dull.”
In making out the case for the Romantic I would like to draw on the political life of John Button and the unfinished contribution of Laurie Carmichael and Paul Keating. John Button – the Labor Party Independent who became a Senator and Minister; Laurie Carmichael, the Communist who led one of the toughest unions, the Amalgamated Engineering Union, and later became Assistant Secretary of the ACTU; and Paul Keating, the Treasurer, Prime Minister, and the source of one of Australia’s most brilliant home grown musicals – Keating the Musical.
Each of these three people in turn could be described as part of the Romantic faction of Australian politics over the past forty plus years; although Paul Keating and John Button were never in the same faction in the ALP and Laurie Carmichael was not even in the ALP. The Romantic faction is, of course, not limited to the ALP, or for that matter, the Communist Party. There are members in most political parties, unions, churches, businesses, universities, the community and the media. It is part of the DNA of this nation. There are plenty about – a smattering in all political parties, and in society in general.
However, there are conditions of entry, as Ralph Waldo Emerson outlined in his lecture, “Man the Reformer”, to the Mechanics Apprentices’ Library Association in 1841. He made the following points:
“Reformers tend to Idealism.”
"They “fly to refuge to the world of ideas and aim to recruit and replenish from that source.”
“The very great and community moment in the annals of the world is the triumph of some enthusiasm.”
“They must be lovers of life, and at once the impossible becomes possible.”
Idealism, ideas, enthusiasm and passion are the keystones of the Romantic. Each factor by itself is not sufficient. Attila the Hun could be described as enthusiastic, the Conservative Movement no less passionate. The defining feature must, therefore, be in its totality: the comprehensive nature of the objective of kindness to all and belief in all – that people are not left behind.
This is not a monopoly of the ALP.
• Malcolm Fraser’s stand on apartheid, his support for refugees and his acknowledgement of internationalism are Romantic traits which should not be ignored or balanced against some less Romantic acts.
• Ian Macphee’s support for effective minimum wages, consultation and respect, were as important in establishing the new wage system as anybody else’s in this nation.
• Jeff Kennett’s support for people who suffer from depression should be remembered, along with his energy in driving the construction of Federation Square.
• Ian Sinclair’s genuine support for regional Australia.
• Rupert Hamer’s commitment to the Arts.
In a multi-dimensional world, Romantic acts are not the preserve of one political party, or even one faction.
Indeed, Australia is not a nation divided into extreme political positions.
I met Tony Blair with Kim Beazley and Paul Keating on two occasions and he talked of New Labor in a new world. His thesis was that the political wheels had collapsed on Communism and therefore a convergence to a broader based centre was inevitable.
The reality, of course, is that Australia had that debate in the1890’s – it shaped our Federation - and after that the extremes of both left and right were largely ignored. We decided then to go to the middle ground.
It was for that reason we had early minimum wages, pensions, child endowment and the recognition of unions.
This was not the United States where until recently they were seeking to protect Roosevelt’s reforms of the thirties!
Lenin was right in his observations about unions, and Australian unions in particular. He said that Australia was in a non revolutionary state because of the positions of the political parties and institutions like unions.
If Lenin thought this was an unstable position - he was wrong. Our democracy has been stable for a hundred years.
Australia’s challenge over the past quarter century was not to become NEW LABOR; it was to prevent the New Liberals overturning the century of political equilibrium that had been broadly established and maintained here.
I believe that Labor Governments have a special responsibility as reformers and catalysts for change. Labor Governments must be the great investors in the social democratic model. They must also be the great protectors.
There are many people who have been lifelong members of the Romantic union in Australian politics, including Gough Whitlam, Bob Hawke, Nugget Coombs, Barry Jones, the Creans, the Beazleys, Joan Kirner, etc, who have helped frame, sustain and enrich its contribution. There have been its champions, like Phillip Adams, who have been a conscience and a chronicler. Phillip could even have been the shop steward.
This is not a relative test of the importance of each person’s contribution but about three people whom I have known quite well.
John Button
Let me first turn to John Button, who I first met in late 1965 or early 1966, after I joined the ALP in 1965 as a 16 year old.
He was in a group of people called the Participants, mainly lawyers, including John Cain and Bob Holt, who were urging a new structure upon the ALP, a modernism and an objective that the ALP should aim to actually win elections!
• Younger people here tonight might find this unremarkable, but for the ALP in Victoria in 1965 and 1966, such a view was not universally popular.
• I remember at a Branch meeting of the ALP Gough Whitlam being pilloried as a political opportunist, more interested in winning the election than he should be!
John Button spoke eloquently of the reasons why the ALP should win elections.
There was a reform agenda in 1965. It was to:
• end Australia’s participation in the Vietnam war;
• achieve equal pay for women;
• improve the pension;
• give unions the right to strike;
• recognise indigenous land rights;
• campaign for peace/disarmament;
• improve the environment;
• Apartheid was wrong and Nelson Mandela was a hero not a terrorist;
• our health care system and our hospitals were inadequate; and
• educational opportunities for lower income students were limited.
This was a good agenda, yet the ALP had not been in power federally since 1949.
Don Dunstan, as a Labor Premier in South Australia, was adding Arts and Lifestyle to a States Agenda. As Attorney-General, Dunstan had delivered land rights to the indigenous people of South Australia in 1965.
Gough Whitlam was arguing for a new sense of Nationalism.
I also remember John Button being relatively gentle with the Conservatives. He said that their greatest fault was their Conservatism, when Conservatism would no longer do.
I did not join the Participants, or for that matter any faction – but was impressed by the pragmatic reality of the trade unions.
When I first worked for the Federated Storemen & Packers’ Union I did so at 17-25 Lygon Street, Carlton. That small building contained the Australian Council of Trade Unions, Maurice Blackburn & Company, the Vehicle Builders Employees’ Federation and the Federal Office of the Federated Storemen & Packers’ Union. The real office of the union movement after 3.00 pm became the John Curtin Hotel next door. This was the geographical centre of union politics in Australia.
John Button worked in the front office on the left and I worked in the back office on the right on the first floor.
Bob Hawke had just begun his presidency at the ACTU. He was working with the person he narrowly beat – Harold Souter.
John Button was very kind to me – he offered advice and support. When Maurice Blackburn left the building he still kept in contact.
He had a sense of humour and a sense of duty. As President of the Professional Divers’ Association (a small union), he worked for nothing. The best payment he ever received was having his house painted. “The Professional Divers were better at diving than painting, but nonetheless, far better than [me] him at painting.”
However, it was much later – in late 1982 and early 1983 - in the contest for leadership between Bob Hawke and Bill Hayden that he displayed his most enigmatic and practical character.
Bob Hawke said to me – that as I liked John Button I should talk to him about the leadership. So I did on two or three occasions.
Always in the most inexpensive of places, like Genevieve in Carlton.
John was a great admirer of Bill Hayden and respected his qualities and integrity. The last discussion I had with him about the leadership was agonising. He debated with himself more than with me. He reiterated the 1965 speech of why we need Labor Governments; that the next Labor Government would need to understand and work with unions and Hawke was from the unions, that the risk of losing was greater with Bill Hayden, and that they would need a longer period than three years.
At the end he said – “I will support Bob, but don’t tell him. I want to tell Bill Hayden first.”
There was a tear in his eye, and in my line of work I did not see many tears.
After Labor was elected in 1983, as Minister for Industry, John Button was an agent for change and modernisation. The Steel, Vehicle and Clothing Industries were reformed, restructured and rationalised. The manufacturing wealth of the nation had to be protected and nurtured, but they could not survive without adapting to the rest of the world.
He worked with industry leaders, unions and the bureaucrats to achieve these results. The process of involvement and leadership was an educative process in itself of lasting significance.
John Button was humorous, gentle, tough and determined. He loved to write, draw, think and communicate.
After leaving Parliament John continued to contribute as a thinker, mentor and talker, and was also a significant writer.
Laurie Carmichael
I had read a lot about Laurie Carmichael before I first met him.
Unlike John Button and Paul Keating, he was not in the ALP but in the Communist Party.
Laurie Carmichael brought an intellect to the union movement that was almost unparalleled.
Laurie Carmichael was, and still is a Marxist. Yet, simultaneously, he was a great contributor to the Social Democrat model of the Australian Labor Party.
I asked him on the odd occasion about this. His explanation was clear enough:
• First, Marx and Lenin were both right in saying that unions, Keynesianism and Social Democratic Governments did create conditions which would defer the inevitable crisis between the bourgeoisie and the proletariat. However, Australia was not the place to test Marxism; it would find its truth in the societies where there was no third way as entrenched as our own. When that happened we would find it hard to avoid.
• Second, Marx would sometimes say of himself when faced with practical outcomes that even he was not a Marxist.
• Thirdly, revolution may take different forms than that which were expected.
• Fourthly, in any event people had to operate within the objective conditions that existed.
He seemed to belie reality – the most feared person in the country, causing or leading strike actions, a communist, but in a union of tradespeople, many of whom were relatively well paid. He won union election after union election. He was a great supporter of union democracy.
He was the antithesis of the media image that that was constructed around him. He talked quietly, logically, listened and inquired. He was a modernist about technological change but had a classical bent in music. He was about practical industrial outcomes but believed in the bigger picture of change in society. There was an ideological framework of reference for all his industrial and political strategy.
The first opportunity I had to see him at work was during the Oil Industry negotiations of 1971. The Storemen & Packers’ Union had a strategy – a minimum wage with bargaining on top. Laurie Carmichael had an ideology. I wondered why a person would place himself under so much pressure year in and year out. There were a myriad of unions involved in the negotiations, but he was the natural leader of the multi-union negotiations.
He outlined the claims, the priorities, the expected counter response by the employers and the unions’ response. It was tactical – an industrial game of chess put with a twist of politics. He was certain of only one thing; that there would be a major dispute. He wanted an outcome in which a reduced number of hours would be worked to give impetus to the campaign for shorter working hours, which he had encouraged at the recent ACTU Congress.
When the Oil Companies made it a condition of the negotiations that there would be no discussions about hours of work, the game he had mapped out was in play. When I asked why he was certain that there would be a dispute, he quietly said, “This is what the McMahon Government wants, in order to save themselves.”
I said, “If we were playing into their hands then why did we want a dispute?” He replied, “Because the dispute will be in our hands and not theirs.” History shows the Oil Companies got their dispute, the Government relished it for a short time, but it was settled before the election. The McMahon Government lost and the oil workers won the 9 day fortnight/19 day month claim.
The Oil Industry became the second bench mark in the claim for a shorter working week; a campaign which had been taken up by Laurie Carmichael, then spread throughout the workforce and established as a national condition - the 38 hour week.
Laurie Carmichael was not merely the great enemy of the Conservative Government; he was made a scapegoat target of an embattled Labor Government during 1975. I stood next to Laurie Carmichael at the ACTU Congress in 1975 when Gough Whitlam spoke. If anybody had reason to be miffed, Laurie did – the pre-Congress attack on him by the then Minister for Labour, Jim McClelland, was personal, contrived and unjustified. But Laurie’s response to Gough’s speech was a little unexpected. “We have not given him a fair go.”
Laurie said, ‘A reformist Government needs more time.” It was a sad occasion to see one of the last great speeches by one of Australia’s great Prime Ministers whereby defeat was conceded, the lesson learnt and the future already being planned. Laurie was thinking ahead. Not for the conflict with the next government, but how the next ALP Government could be given the best chance.
Years later, the Accord could not have been achieved without Laurie Carmichael; the ALP could not so easily have won government in 1983, and it could not have governed so effectively without him.
The years of the Accord extracted a price for union leadership, but also laid a basis for substantial improvement for those most in need.
Laurie Carmichael did have a class view of life – his class view was that a militant elite would provide the leadership, but the benefit had to be spread to the class of workers.
He supported the initial wage restraint under the Accord because:
• First, we inherited an economy in bad shape.
• Second, overall restraint was consistent with the view that some sections of the workforce should be given the opportunity to catch up on pay and conditions.
• Trading wages to achieve Medicare was of great benefit; and
• Finally, we had a plan for an unusual exit from the restraint – the extension of superannuation.
However, there was an issue much bigger in Laurie Carmichael’s view, and that was the role of education. It was about lifting the standards of trade education and recognition for the contribution of workers’ skills. It went further to broadening workers’ skills, adjusting for the technological revolution and increasing workers’ opportunities. He became the great advocate for education.
In any event I always thought that Laurie was concerned in some sense about finding a pathway to achieve the Nirvana that was envisaged by the great revolutionaries. His was the long term, where workers had interesting times - at work and at play – education, workers’ involvement and control, leisure and the arts.
Paul Keating
Now, let me turn finally to Paul Keating.
My first exchange with Paul Keating in 1975 was blunt enough. He said why should unions be concerned about import parity prices when the ALP had no chance of winning the next election? “You should be talking to Fraser not us”, he said.
The next occasion on which we met was in early 1983 when he walked into the Waterside Workers’ Federation meeting room to finalise the Accord negotiations. His position was plain enough.
The Accord was not of his making, he was doubtful if it had a snowball’s change of lasting, why would the Labor Government trust us when we did so much damage last time, the unions would not keep to their commitments, and in any event, he did not expect to be Treasurer anyway.
This was not the best start for a long friendship.
However, he became the greatest supporter of the Accord – an Accord warrior.
His confidence in us [unions] grew gradually.
• The currency was floated without any negative implications.
• The unions kept our commitments to achieve Medicare.
• He knew we had a plan to exit from the wages pause – through superannuation.
He became the most regular visitor to the ACTU and the greatest supporter on superannuation, minimum rates of pay, union bargaining rights, and along with Bob Hawke, Medicare. These were not things to negotiate. He wanted to do them.
However, along with Bob Hawke, he was also the most challenging. He chased us remorselessly, from union demarcation disputes, to internationalisation of the economy, increased competition, improving productivity, privatisation, reduced government expenditures, and restraint. All the big picture economic issues.
It is easy to list the achievements of the Hawke-Keating Government.
However, the real test of their legacy is the test of time.
After the 1996 election as we pondered the defeat of the Labor Government, I can recall telling Paul that whilst he could regret not having another few years of government, there must come a time when your beliefs and contributions have to be tested against the opposing forces. The greater their value, the greater their durability.
Paul Krugman, the noted US economist, recently wrote a book called “The Conscience of a Liberal”. He explains how the defeat of Barry Goldwater in the 1964 elections became the catalyst for the gradual domination of what he terms the Conservative Movement, whose mission was to undo the multi-generational impact of Franklin Delano Roosevelt (FDR).
Krugman describes the relative success of that Conservative movement in the USA and the costs. Krugman paints a picture of the USA since the early sixties, its economy growing rapidly, productivity expanding and wealth being created. However, simultaneously minimum wage adjustments were frozen for long periods, tax cuts were distributed to the rich, health costs burgeoned and executive salaries boomed. To fund the increasing living standards, the nation went on a gigantic binge – deficits at household, corporate and government levels kept the growth purring along. The rest of the world funded the wars, the credit cards, the cosmetic surgery, the gas guzzlers and the debt.
But it ended in tears – with the great Global Credit Crisis.
You can almost hear Karl Marx from his grave at Highgate Cemetery in London saying, “I told you so.”
Many of the features that Krugman describes are common to Australia’s experience – high levels of economic growth, of productivity, executive salary surges, and increasing overseas debt to fund our growth. Credit grew at more than 10% compound per annum over the past 30 years, with Australia sucking in billions from overseas to fund our growth.
Over the long run, productivity growth is determined by knowledge and technological change. It is where increases in real living standards come from. Since 1992 Australian productivity growth (measured as GDP per head) is up 35% compared with 33% in the USA. Both countries increased productivity at about the same rate.
The similarities should not be ignored, but the differences are even more interesting.
Let us compare Australia with the USA since 1992 – since the recession of the early nineties - on six broad economic and social criteria.
- International Trade
As a share of the economy, Australian foreign trade rose from 25% in 1992 to 40% in 2008. The United States’ share rose from around 20% to 30% over the same period
Foreign trade raises incomes, as well as the range and quality of things we can buy. It gives economies of scale in production and consumption. Australia’s is a more open economy. Our principal trading partners have become the emerging nations of Asia, particularly China. We reduced tariffs. We have a much more flexible exchange rate. We have lower inflation
- Wages and Jobs
In the sixteen years from 1992 to 2008 there were 15 increases in Australian minimum wages, compared to 4 in the USA.
The United States federal minimum wage was frozen from 1997 to 2006.
The real increase in the minimum wage over the period has been 8% in Australia and 4% in the United States. However, the latter figure disguises the dramatic fall in the real value of the minimum wage of 14.8% from 1996 to 2006.
The minimum wage is more relevant here. Australia’s federal minimum wage is currently 45% of the average wage; in the United States it is 25%. Around 15% of Australian workers rely on minimum wages compared to 3% in the US. And, in Australia, the minimum wage is supplemented by superannuation, better annual leave, better family leave and better sick leave.
For workers who do not rely on minimum wages, collective bargaining delivers better wages than individual contracts. Australian unions embarked on bargaining in the early nineties and are the catalyst for most collective agreements, with increases in the range 3% to 5% over the long haul, spreading real wage increases efficiently in the market place.
This can be starkly seen in the case of a shop assistant, who in Australia received $15.64 per hour in 2008 compared to US $6.55 in the United States. (Using average 2007/08 exchange rate $7.24. Using the lowest exchange rate of 62¢, it is still only $10.56.)
As Pisano and Shih note in the most recent Harvard Business Review, “Average weekly real wages have remained essentially flat since 1980, meaning that the United States’ economy has been unable to provide a rising living standard for the majority of its people.”
The unemployment rate in Australia is 5.9%, up from 3.9% before the global financial crisis. The United States’ unemployment rate is 9.5%, up from 4.6%
Australian employment grew by 2.2% per year from 1992 to 2008, compared to 1.3% in the USA.
And our participation rate – the share of the population aged 16 – 65 in work and looking for work – rose from 44.2% to 50.2%, whereas the United States increased from 46.9% to 48.3%
- Health
Health care costs are currently 9% of Australia’s GDP, up from 7.4% in 1995. This compares with 16% currently in the USA, up from 13.3% in 1995. Health costs have risen in both countries, but by more in the US.
The United States private system leaves a large minority of its population without any health insurance at all, whereas Medicare here delivers good baseline health care to all. Government expenditure on health in the United States is 45.3% of the total, compared to 65.8% here.
Life expectancy in 1990 was 75 years in the US and 77 here. Today it is up 3 years to 78 in the US and up 5 to 82 years here.
The adult mortality rate - the probability of dying between age 15 and age 60 - is expressed as the number of deaths per 1,000 of the population. In 1990 it was 132 for the United States and 96 in Australia. By 2006 it had fallen to 109 in the United States and 65 in Australia
- Superannuation and Pensions
Australia progressively introduced a national superannuation system; national savings were allocated to the Future Fund and the Liberal Government simplified and extended the end benefit. In Australia, superannuation increased from 3% of wages to 9%.
The United States has substantially had a corporate pension system funded on the basis of defined benefit.
Ours is a system that has been funded by productivity growth.
There are three aspects of superannuation which need recognition and understanding.
First, in Australia, superannuation assets are now over 100% of GDP. In the USA, the ratio of super assets to GDP is 75%, the United Kingdom is 84%, New Zealand 12% and Canada 54%.
Second, relative to the rest of the world, Australia’s equity risk premium has trended downwards since 2001. This, in turn, reduces the cost of capital and encourages investment.
Higher savings mean interest rates are lower than they would have otherwise been.
Third, no Australian company has been made bankrupt by Australia’s superannuation system.
h5. Taxation and Government Spending
Over the past decade and a half, Australia has run budget surpluses in the good times and deficits when economic growth halted, and our public debt is tiny by world standards.
The United States has run increasingly larger fiscal deficits because of its exorbitant income tax cuts to high income earners and its pursuit of a series of wars. The United States public debt is large and rising.
- The Financial System
The Four Pillars Policy, the lending policies, the controls and regulations and lower rate of leveraging have contributed to a more stable financial system. Overall, Australia has had a better managed financial system.
For example, no bank in Australia had a leverage rate that could compare with the Bank of America’s 73.7:1 leverage ratio; ie a capital of 1.4% of its assets.
If you added the off-balance sheet it was 134.1. (Bridgewater)
These changes, before the initiatives of the Rudd Government, placed Australia in a better position than most. The Rudd changes have preserved, and indeed, promoted that advantage.
We can ask the same question that Krugman asks - where did the productivity increases go? In Australia, low and middle income families received a share through wages and social services. In the United States, the lions took the lions’ share
We have lower levels of toxic debt because of higher living standards for those most in need.
We have less recourse to debt because of a better health care system and real wage improvements for the majority.
The middle class is better off because of unions.
Superannuation savings have provided ballast to the system.
It has worked because the big changes – exchange rate, wealth valuation, interest rates and fiscal policies – have been the adjustment factors.
Australia is better placed with the Asian growth markets. We didn’t do better simply because Australian Governments have been better managers or even visionary investors – it is because companies invested and workers adjusted to change. Real wealth was created.
However, it is reasonable to say that in the past generation the economy has been satisfactorily managed. The great structural decisions of the Hawke and Keating Governments have been vital in establishing our current position.
More importantly, the Social Democratic framework remains in place. It has to be repaired in places, but the essential elements stood the test of time. In a sense, that framework and the distribution which it encourages, contributes to stability.
It is a model which can be called lots of things, but it reflects most of all the philosophies associated with Paul Keating:
Increasing acceptance of internationalisation.
Distribution to all – so that education, retirement, health and access to information are universal rights.
Increased competition.
So that there can be no misunderstanding, let me state clearly that long periods of Conservative Government did come at a price:
The weakening of unions is no good thing.
The implicit and explicit racism encouraged and nurtured by John Howard is a matter of national shame.
The failure to become a republic.
The development of the shortage of skills foreseen by Laurie Carmichael, but not ameliorated by government action.
The treatment of refugees.
The inadequacy of the health system.
The attack on minimum wages.
The delay in reacting to the needs of the environment.
Australia would be better off with 15% superannuation.
We have accrued an enormous foreign debt. The massive growth of Australia’s liabilities abroad - $193 billion to $610 billion between 1996 to 2007.
Australia paid a price, but when Work Choices was defeated it was a resounding vote for the Australian Social Democratic model in the same way that Stanley Melbourne Bruce’s defeat in 1929 represented a beacon of resistance to conservative social vandalism.
The commonality between John, Laurie and Paul
Button, Carmichael and Keating had many differences, but there was a commonality of purpose.
They thought and acted as generational players. They occupied the stage over a generation, learnt from winning and losing, and made decisions for the ensuing generations.
Their predilection was always to assist the poor.
They were warriors – they were lovers - but willing fighters for their cause.
They believed in practical outcomes – they were driven by philosophies, but wanted real outcomes.
They understood and promoted a standard of living that was not just about wages – but about other things such as music, books and theatre – an inner life.
They were essential democrats – putting their views and opinions and arguing for them. In a sense, more importantly, they believed in people – they wanted them to have more than a say. They wanted their involvement.
They liked and respected one another.
In their political life they were the Generals of the Romantics. They painted pictures of a better life - not for some, but for all.
The Future
This is not a speech of regret, lost causes or excuses. Australia has done better than most countries and is in a position to do better again. We are well placed. However, we do know one thing, that the future is not ours to make - in essence it belongs to those who will own it.
The Rudd Government is at an historical juncture in its early years. After a hesitant start, it should be recognised for its bravery in the fiscal stimulus it initiated to the global crisis, the changes that it will create for Australia’s universities and the proposed Broadband investment. If cemented and handled well, it will take well deserved credit for economic management. The repairs to the wage system and the dilapidated school system were timely and necessary. The Labor task is to build a higher platform for social democracy for the next generation.
The young, characterised as Generation X or Y, have been cast as individualistic and self-interested. However, I cannot reconcile it with these facts:
Young people in Australia voted overwhelmingly for the Greens and the ALP.
Young Americans went out to work and vote for Barack Obama.
The young hated Work Choices.
They start paying for their retirement from the first day in the workforce through their superannuation.
They substantially pay for their university education over their lifetimes.
They share family responsibilities more than ever.
They are less involved in racial extremism.
They are greater supporters of environmental solutions.
They subsidise the health care for the aged.
In short, without the young, the basic foundation of the Romantics within all the parties would be weakened. It is the young who are giving sustenance to the Romantics.
However, there is a world of fighting to do for the next generation to make the same advances as the last.
We know this:
The health care budget will increase as the population ages and seeks better health care. To maintain costs at the current proportion of GDP is unrealistic. A 2% - 3% increase represents an increase of $20 billion. As GDP rises, so will the amount.
Governments may set the age of the pension, but they do not set the age of retirement. That is a decision for the employer and the employee.
Retirement planning is not extending the age of entitlement of the pension. Retirement opportunities currently begin between 55 to 60 years of age for a great number of Australians. The maintenance of this opportunity, and for a pension able to sustain a living standard, will require a contribution of between 12% to 15% of wages.
Unions are important in ensuring a fairer distribution of resources. Krugman has illustrated the impact of weakening the bargaining capacity of unions. Unions must always endeavour to be useful to their members and lead campaigns for them.
Unions must continue to pursue improvements in living standards, broadly consistent with the underlying rate of inflation and the trend increase in productivity.
There is a need to broaden the agenda to include superannuation, legislating for new national long service leave standards, study leave and training obligations and rights at work.
There is a Republic to be established.
Arts to invest in.
A national treaty with indigenous Australians to be made.
Education opportunities to be established.
Regions to be sustained.
Cities to be rebuilt.
Infrastructure of roads and rail to be funded – priced at the most effective public price and not the private price – and achieved by partnership with the private sector.
Housing for the poor to be provided.
Communications to be afforded to all.
Wars to exit from.
Universal protection to be established for all those who are disabled, irrespective of the cause.
Climate change to be addressed.
We cannot be complacent about the foreign debt. We could afford to be complacent about the foreign debt when there was a capital surfeit, but those times are gone.
It is true the world does balance its debt and obligations, but we need to:
grow our own savings so as not to amplify that dependence; and
be prepared to embrace equity and debt from those nations that we trade with.
We could borrow from the rest of the world to fund our homes and factories, but we need to provide more of our own capital.
If Australia goes to 15% superannuation, we will by the mid-2020’s have between 4 - 5 times the GDP in superannuation assets. This will not only provide the capacity for the retirement needs of future generations, including their additional health care costs, but also a level of savings in a competitive trading world that will give us the greatest protection for a generation.
There are lessons from the past which are relevant for the future.
The Australian Social Democratic model works well.
Whilst it needs management and tendering, it regularly needs to be filled by enthusiasts with flair.
However, it is not filled by hot air and rhetoric.
The economy must produce real wealth, more efficiently, and over time share that growth equitably amongst all in society and between the competing claims for short and long term improvement.
That is how we funded superannuation, and that is how we can fund the next stage, health savings and income protection over time.
We do it best by being a positive nation in the world of economic growth, as the tectonic shifts of power continue unabated.
We will do best as a nation that saves for its own future, particularly in view of the uncertainty that exists.
Whilst Australia has every right to be more optimistic than most, we should not underestimate the problems in the United States’ economy and the flow-on impact on the rest of the world.
Obama faces a mountain to climb by comparison to the hill we have to contemplate in Australia. The deficit will go to 12% of GDP. It is vital that he wins on Medicare.
The USA is vibrant, resilient and dynamic. However, if the fundamental restructuring does not occur, then those in charge will be seduced by the soft option of inflation.
The world will be a lot less stable as the inflation genie is let out of the bottle.
Conclusion
Overall Australia has been well served by the political process, not just by Governments, but by Oppositions.
There have been some inexcusable lapses, some bad judgements, some bad mistakes, things that make your heart burn and eyes sting, but on balance they have been outweighed by a combination of good management and brave investment.
But history shows that defeat often follows euphoria and rejoicing.
The case for Romantics and Romanticism in politics is no less substantial than it ever was.
There is a humanity to save from itself – its wars and its nuclear armoury.
There is a planet to save from the very impact of humanity.
It was said of the Romantics that they broke the polite rules and breached the conventional restraints, and in doing so “exalted passion, energy and imagination”.
We are indebted to them.
After the eating, talking, drinking and the heart stops beating, what is left is the soul of creativity - the paintings, the buildings, the poems, the plays, the movies; the accretion of values both good and bad – the ideas, the laws, the philosophy and the ideals.
It has been a great pleasure and privilege to have given the inaugural John Button Oration. For a person of great values – a true Romantic.
He helped make the political world “not so dull and dead”.
