This is one of those grab bag posts caused by a flurry of stories in today's press.
It starts with an item by Peter Costello in which he bells the cat on the "faceless" "powerbrokers", most notably those in the ALP. After an introduction about the influence of Deng Xiaoping after he formally "retired" (and one could add Lee Kwan Yu) he writes;
In Australia we have people who imagine themselves as latter day Dengs - who hold no office but boast that they can make and break party leaders and governments. These are the people the press describe as the ''faceless men'' [although we are getting heartily sick of seeing their faces these days], factional warlords, or ''party powerbrokers''.
The way to become a powerbroker is to spend an inordinate amount of time on internal party ballots. It doesn't matter that these ballots relate to non-positions of no influence. A powerbroker must engage in ceaseless activity. This shows everyone how important they are. It helps to have a union or followers who provide the factional boss with some bragging rights. But the most important skill of all is to cultivate good relations with the media.
...
It has always amazed me that the right wing operatives of the NSW branch of the Labor Party get such a soft run in the mainstream media. This is a group that brought the public the most incompetent state government in modern memory - from Carr to Iemma to Rees to Keneally. Outside their little fiefdom, where loyalty is rewarded with patronage, most of them would be unemployable. So what are they good at?
I would disagree with the assessment of the NSW Labor Government as "the most incompetent in modern memory", not least because of what it says of the Liberals that took so long to unseat it! I also think the accusation of being "unemployable" is odd - Karl Bitar has a nice little earner at Crown Casinos now, while I'm yet to hear of Costello having found a job.
But he absolutely nails the "modus operandi". After commenting on the stories about Sam Dastyari wavering in his support for Julia Gillard he writes;
There is nothing worse than being a powerbroker who has no power. So if Gillard is going down then the powerbrokers need to get off her bandwagon and take credit for her demise as much as they took credit for her ascension.
And there indeed is the rub, the ability of the faceless men or power-brokers to take the credit for events that have unfolded without their influence. The scribes who write about this no doubt also believe in the "great man" theory of history - events happen because of specific individuals, rather than (the more accurate) specific individuals fall into roles created by events.
Elsewhere the ever-impressive Jessica Irvine cautions about a completely different group of powerbrokers and influence peddlers, the business lobby groups. She writes;
Politicians and the media cop most of the blame these days for the dumbing down of the political debate. But let's not forget this entire industry of rent-seekers who are doing the best they can to muddy the waters of good public policy and confuse everyone.
Politicians need to wake up to the way they are being played. The public needs to switch on their rent-seeking bullshit-ometers when watching the next round of self-serving business advertising and learn to think: ''Well, they would say that, wouldn't they?'' And the media needs to rediscover its love of man bites dog tales and stop giving these guys a free kick.
Occupy Wall Street protesters in the United States are leading a global backlash against crony capitalism and special government favours for finance sector chief executives.
Australians have invented our unique brand of corporate rent-seekers, and far from standing up against them, we've often been complicit tools in their trade, shifting our opinion on public policies in response to their self-interested advertising campaigns.
When government thinks it's doing what the public wants, but what the public wants is in fact what big business wants it to want, we have a problem.
And that note to recognise the rent-seeking flavour of all the admonitions we hear from the corporate sector about public policy, provides a nice segue to the latest flurry of pieces on the Occupiers.
Shaun Carney rambles on a bit before noting that the Occupiers are going to have to get used to a bit of discomfort if they want to effect change. On the way through he notes the difference between Australia and the US that we actually have some elected representatives of a radical kind - the Greens. But he also notes the difference between the Greens trying to be an ordinary organised political movement, and the Occupiers who eschew such structures.
He also does a neat job of summarising the Occupiers;
The local version is a series of protest groups in the literal sense: they are protesting about just about anything you can name, from a left perspective. If interviews with members are any guide, they are variously against rising inequality, corporate and financial greed, our system of representative democracy, political parties and their leaders, failures of social justice and environmental degradation.
Sarah Caslan writing in The Conversation picked up the strand of the validity of protesting what is, without having to advocate for what you want. She wrote;
If you can’t validly protest the status quo without knowing exactly how to change it (particularly difficult for those without power who are most likely to be dissatisfied), that’s a playing field designed to entrench “the way it is” (whether one likes it or not).
Instead it is surely legitimate, as is happening with Occupy, to start conversations on change, whether they result in concrete steps or not. Part of the point of Occupy is to get people talking about political and economic systems and the possible need for change, and in that respect it is probably succeeding.
The validity of those concerns has been well detailed by James Arvanitakis in The Punch. He goes into detail about the problem of the distribution of wealth, putting profits before well-being, and finally the problem of "corporate power". (The first of these was Irvine's subject in her weekend column, and the latter of course today's). He concludes;
The Occupy Movement may not have a catchy slogan like “save the whale”. What they have done, however, is identify a sense of unease that the economic system is letting down a majority of the world’s population: and the evidence is there to support them.
Meanwhile The Conversation also reports on an ANU poll that shows a dramatic lift in the proportion of people "disastisfied with democracy" from 14% in 2007 to 27% now.
The utem tries to place the "blame" for this with the Government of Julia Gillard. What the Occupiers are trying to highlight is that the problem is much, much bigger than that.
The thesis as it is unfolding to me is that the initial "impetus" to democracy can be described as an approach to limiting power of one group over society (or citizens) as a whole. The motivation in the UK model built in the 17th century was about limitation of the arbitrary power of the monarch and aristocracy. The history of that evolution goes back further to the empowerment of the aristocracy over the monarch in the Magna Carta.
Before all of these the real "authority of the state" comes from the way it protects citizens from the exercise of power by force, be that defence against external aggressors, or the protection of life and property from local aggressors.
Ever since "corporations" were imbued with the "rights" of a natural person - including in the US the political right to campaign - there has grown a new unchecked power, the power of the corporation. The power of these corporations does not rest with their shareholders generally, but with the executives of the corporations and with the executives of the financial corporations (investment banks and pension funds) that can and do exercise shareholder control.
And in this mix elected representative politicians are seen increasingly as part of the power mix, not part of the restraint of power.
Novae Meridianae Demetae Dexter delenda est
Showing posts with label Occupiers. Show all posts
Showing posts with label Occupiers. Show all posts
Wednesday, October 26, 2011
Monday, October 24, 2011
Occupiers again
I can't seem to get over my obsession with the Occupiers. Following their eviction in Melbourne and Sydney in recent days, there is a new flurry of confused commentary.
The standard line gets repeated that the occupiers need a point not just publicity.
A new avenue is found by David Penberthy who tries to claim that it is a left-wing protest about left-wing problems. He makes a number of errors, first by grouping everything that is not conservative into one basket of "the left". Yes some of the occupiers are your usual group of Trots who practice continual revolution, object to everything etc. But a slab are not, they are more thoughtful.
The second is to try to use the European protesters in Greece as if they are the same as OWS. They are not. To go to blame US problems with;
it is highly debatable whether the broader economic troubles are being caused by the kind of obscene and indefensible greed demonstrated by the likes of Goldman Sachs, or excessive government spending and sloppy banking policies which meant that hundreds of thousands of people were given money for mortgages which they could never repay.
is to suggest that "sloppy banking policies" had nothing to do with lax regulation. The "excessive government spending" has mostly been on very un-left war efforts.
A more thoughtful piece notes;
Not surprisingly, the 1 per cent are fighting back. Given their disproportionate wealth, power and privilege compared with the demonstrators, their PR message is cutting through. It is that the dissidents are ridiculous and their message unclear.
To make the point the author provides some snippets from the New York "Declaration of Occupation";
As one people, united, we acknowledge the reality … that no true democracy is attainable when the process is determined by economic power. We come to you at a time when corporations - which place profit over people, self-interest over justice and oppression over equality - run our governments. We have peaceably assembled here … to let these facts be known.
They have taken our houses through … illegal foreclosure … they have taken bailouts from taxpayers with impunity and continue to give executives exorbitant bonuses.
They have continuously sought to strip employees of the right to negotiate for better pay and safer working conditions …
They determine economic policy, despite the catastrophic failures their policies continue to produce … join us and make your voices heard!
To put the US housing experience in perspective - why is it that the financially illiterate people who borrowed money on the professional advice of their bankers and brokers are the ones to suffer, while the bank executives have been still taking their salaries and bonuses, and the shareholders who failed to appoint competent Boards have been largely protected?
And it is not true the movement has no demands, their eight demands include specific ones about revamping financial and corporate regulation. Some of these are as appropriate in Australia.
Novae Meridianae Demetae Dexter delenda est
The standard line gets repeated that the occupiers need a point not just publicity.
A new avenue is found by David Penberthy who tries to claim that it is a left-wing protest about left-wing problems. He makes a number of errors, first by grouping everything that is not conservative into one basket of "the left". Yes some of the occupiers are your usual group of Trots who practice continual revolution, object to everything etc. But a slab are not, they are more thoughtful.
The second is to try to use the European protesters in Greece as if they are the same as OWS. They are not. To go to blame US problems with;
it is highly debatable whether the broader economic troubles are being caused by the kind of obscene and indefensible greed demonstrated by the likes of Goldman Sachs, or excessive government spending and sloppy banking policies which meant that hundreds of thousands of people were given money for mortgages which they could never repay.
is to suggest that "sloppy banking policies" had nothing to do with lax regulation. The "excessive government spending" has mostly been on very un-left war efforts.
A more thoughtful piece notes;
Not surprisingly, the 1 per cent are fighting back. Given their disproportionate wealth, power and privilege compared with the demonstrators, their PR message is cutting through. It is that the dissidents are ridiculous and their message unclear.
To make the point the author provides some snippets from the New York "Declaration of Occupation";
As one people, united, we acknowledge the reality … that no true democracy is attainable when the process is determined by economic power. We come to you at a time when corporations - which place profit over people, self-interest over justice and oppression over equality - run our governments. We have peaceably assembled here … to let these facts be known.
They have taken our houses through … illegal foreclosure … they have taken bailouts from taxpayers with impunity and continue to give executives exorbitant bonuses.
They have continuously sought to strip employees of the right to negotiate for better pay and safer working conditions …
They determine economic policy, despite the catastrophic failures their policies continue to produce … join us and make your voices heard!
To put the US housing experience in perspective - why is it that the financially illiterate people who borrowed money on the professional advice of their bankers and brokers are the ones to suffer, while the bank executives have been still taking their salaries and bonuses, and the shareholders who failed to appoint competent Boards have been largely protected?
And it is not true the movement has no demands, their eight demands include specific ones about revamping financial and corporate regulation. Some of these are as appropriate in Australia.
Novae Meridianae Demetae Dexter delenda est
Monday, October 17, 2011
Occupiers and Pirates - a reprise (updated)
I'm going to link the two movements again because they both represent a shift in thinking. They know what they are against but haven't yet figured out what they are for.
Today Peter Shergold tells us that what the Occupiers hate about business is the "unconstrained pursuit of high-risk short-term profits." For him the solution is just a nice dose of good old fashioned "Corporate Social Responsibility" (or CSR).
I wondered how he went pitching this to John Howard when he was Secretary in PM&C. Then I remembered that Howard did have a go at promoting corporate philanthropy, but as Shergold points out that is not the same thing. That is the activity that does usually get short shrift as "launch, lunch, logo." Shergold sumarises it as;
The challenge for those of us who believe in market economics is how to restore business legitimacy. The 'licence to operate' needs to be rearticulated. Business must be able to exhibit its societal value, not to trade-off against the social and environmental costs of economic success but as integral to the supply-chain by which goods and services are produced. 'Giving back' is no longer sufficient. Charity won't save capitalism.
But Shergold does nothing to rebuff the most compelling counter-argument from Milton Friedman, who argued The Social Responsibility of Business is to Increase its Profits.
Yes there are good examples of CSR or triple bottom line - but as one blogging former exec notes individual KPIs still reflect revenue growth well above the CSR stuff.
There is a logical case that CSR in fact drives better financial performance long-term, but the issue remains the focus on short-term results. Short-term results have become significant through the inadequate response to the principal-agent issue; that is tying managers to the interests of shareholders.
The interests of shareholders - especially those whose retirement savings are invested - is in long term returns not short-term share price. As I commented before a way of dealing with this issue is by changing the remuneration basis of executives.
But Shergold also has to deal with the unfortunate facts of capitalism in America. Decades of focus on economic efficiency over equity have resulted in a dramatically less equitable society. CSR might knock the unpalatable edges off business, but will it change the equity trend?
I think the answer is "no.' I think that change requires a fundamental reset of the values espoused in public policy - away from "economic efficiency" and towards "growth and equity". They are very very different things.
Finally, the Pirate Party in Germany grapples with the question of what next from a totally different stance. In a discussion about the fact the party is very male oriented the political director (a female) said;
We don't keep track of our members' gender. We believe true equality starts when we stop counting women.
That is possibly the best indication that we are now in a "post-sixties" generation. Popular movements from the mid 1960s on have built on the themes of peace, environmentalism, and feminism. The current generation of "young radicals" take these as given - whether rightly or not. They may not be universally accepted across society, but they are almost universally adopted in the younger persons value set. They aren't, therefore, worth campaigning about.
Update: Ross Gittins this morning offered an interesting take of the failure of most economists to address some of the issues. He cited a book The Economics of Enough. A quick "thumb through" of the copy I just bought for my "Kindle for PC" (don't you just love that immediacy) says it is a very good book written from the basis of an orthodox economist recognising some of the empirical results (inequality, recession) and other theoretical work (institutionalism, behavioural economics). It deserves a more thorough read.
Novae Meridianae Demetae Dexter delenda est
Today Peter Shergold tells us that what the Occupiers hate about business is the "unconstrained pursuit of high-risk short-term profits." For him the solution is just a nice dose of good old fashioned "Corporate Social Responsibility" (or CSR).
I wondered how he went pitching this to John Howard when he was Secretary in PM&C. Then I remembered that Howard did have a go at promoting corporate philanthropy, but as Shergold points out that is not the same thing. That is the activity that does usually get short shrift as "launch, lunch, logo." Shergold sumarises it as;
The challenge for those of us who believe in market economics is how to restore business legitimacy. The 'licence to operate' needs to be rearticulated. Business must be able to exhibit its societal value, not to trade-off against the social and environmental costs of economic success but as integral to the supply-chain by which goods and services are produced. 'Giving back' is no longer sufficient. Charity won't save capitalism.
But Shergold does nothing to rebuff the most compelling counter-argument from Milton Friedman, who argued The Social Responsibility of Business is to Increase its Profits.
Yes there are good examples of CSR or triple bottom line - but as one blogging former exec notes individual KPIs still reflect revenue growth well above the CSR stuff.
There is a logical case that CSR in fact drives better financial performance long-term, but the issue remains the focus on short-term results. Short-term results have become significant through the inadequate response to the principal-agent issue; that is tying managers to the interests of shareholders.
The interests of shareholders - especially those whose retirement savings are invested - is in long term returns not short-term share price. As I commented before a way of dealing with this issue is by changing the remuneration basis of executives.
But Shergold also has to deal with the unfortunate facts of capitalism in America. Decades of focus on economic efficiency over equity have resulted in a dramatically less equitable society. CSR might knock the unpalatable edges off business, but will it change the equity trend?
I think the answer is "no.' I think that change requires a fundamental reset of the values espoused in public policy - away from "economic efficiency" and towards "growth and equity". They are very very different things.
Finally, the Pirate Party in Germany grapples with the question of what next from a totally different stance. In a discussion about the fact the party is very male oriented the political director (a female) said;
We don't keep track of our members' gender. We believe true equality starts when we stop counting women.
That is possibly the best indication that we are now in a "post-sixties" generation. Popular movements from the mid 1960s on have built on the themes of peace, environmentalism, and feminism. The current generation of "young radicals" take these as given - whether rightly or not. They may not be universally accepted across society, but they are almost universally adopted in the younger persons value set. They aren't, therefore, worth campaigning about.
Update: Ross Gittins this morning offered an interesting take of the failure of most economists to address some of the issues. He cited a book The Economics of Enough. A quick "thumb through" of the copy I just bought for my "Kindle for PC" (don't you just love that immediacy) says it is a very good book written from the basis of an orthodox economist recognising some of the empirical results (inequality, recession) and other theoretical work (institutionalism, behavioural economics). It deserves a more thorough read.
Novae Meridianae Demetae Dexter delenda est
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