Labor, Anthony Albanese and the workers they left behind
The Labor Party is dangerously beholden to the moneyed interests that fund it.
The widening ideological disconnect so common among misnamed “progressive” parties across the West is made worse in Australia by a dirty big secret within Labor that not even Fitzgibbon can admit. The party is dangerously beholden to the moneyed interests that fund it.
In a Faustian pact, Labor has sold its soul, and its policies, to those who provide jobs for its officials and money for its campaigns.
Newspoll data this week revealed that Labor, under Anthony Albanese, is struggling to build election-winning support among key voting groups. Labor’s support base is as thin and lumpy as a lousy Christmas gravy. Labor performs slightly better than the Coalition only among university-educated voters, and only on a two-party-preferred basis where many voters choose Greens first.
Forget pictures being worth a thousand words. These days a tweet speaks volumes about Labor’s wonky ideological antennae. A few days before Christmas, Labor’s Tanya Plibersek tweeted: “We will know that we have achieved gender equality when men spend weeks planning, shopping and @&$#%^ wrapping in preparation for Christmas.”
Maybe Labor’s former deputy leader was just kidding around. But, to be honest, a left-wing feminist with a sense of humour is as rare as a queer tomcat. Plibersek’s silly little tweet points to Labor’s seriously big ideological fallout with mainstream Australians.
Most Australians support gender equality, but not Plibersek’s schoolgirl version that is based on a miserable view of men and an even more wretched view of women. Most women know that men make equally important, but different, contributions to a family. Plibersek’s cookie-cutter view of the sexes is a small but pointed part of Labor’s declining relevance to ordinary Australians. No wonder men, in particular, have turned away from a party focused on boutique nonsense.
Labor’s tin ear is made worse by its cockeyed approach to financial security. Take home ownership, undoubtedly one of the most important goals for most Australian families. Yet, for 30 years now, the ALP has prioritised superannuation over home ownership. It has forced workers to put ever increasing proportions of their wages into superannuation, restricting the ability of average Australians to save for a deposit and get on the home ownership ladder.
Is it any wonder rates of home ownership have fallen? The Australian Institute of Health and Welfare says home ownership for 30 to 34-year-olds dropped from 64 per cent in 1971 to 50 per cent in 2016; for 25 to 29-year-olds, it fell from 50 per cent to 37 per cent over the same period; and for 50 to 54-year-olds, from 80 per cent to 74 per cent.
Making the plight of Australian workers worse, forcibly extracting ever more money from workers’ pay packets in superannuation means correspondingly smaller wage increases. As the Grattan Institute put it colourfully, and accurately, there is “no free lunch: higher super means lower wages”.
Its research extracts administrative data from 80,000 federal workplace agreements made between 1991 and 2018 to show that about 80 per cent of the cost of increases in super is passed to workers through lower wage rises within the life of an enterprise agreement, typically between two and three years. And the longer-term impact is likely to be even higher.
“This trade-off between more superannuation in retirement but lower living standards while working isn’t worth it for most Australians,” says lead author and Grattan’s household finances program director, Brendan Coates.
The ALP’s addiction to forced saving through super at the expense of home ownership and wage growth seems impossible to understand. Why would the party of the worker pursue such demonstrably anti-worker policies? Why would it advocate so forcefully for policies that impose terribly adverse effects on Australians’ ability to own their own home and secure higher wages?
Enter the first group of plutocrats wielding influence within Labor: the industry superannuation fund movement. The lifeblood of industry super is ever-increasing mandated flows of money from workers’ pay packets. Guaranteed superannuation flows not only generate huge fees for these funds and their managers. The increased riches boost their voting power in our major corporations, giving them enormous raw power over the broader economy. To maintain these fund flows and entrench their power, the funds need guaranteed fealty from the ALP. The ALP is only too happy to oblige as the money it once got from ordinary union members and union affiliation fees is drying up in lock-step with falling union membership.
It’s a neat deal: the industry funds give board seats to barely qualified union representatives and these directors’ fees flow back to the unions and then to the ALP. To say nothing about offering a new career path for former Labor politicians.
Like one of those tacky TV deals, there’s more. The industry funds make various third-party payments for everything from advertising in union publications to paying for union picnic days. These also find their way to the ALP (minus a clip for the union).
This money circle means the ALP is forced into ever more ridiculous and unnatural policy positions. Labor tries to justify appalling industry super governance it would never tolerate in listed corporations. The party that claims to be the alternative government is also forced to defend denying workers the choice between higher wages and more enforced superannuation. That same party is now so corrupted by financial lifelines, it must oppose policy that makes it easier for workers to buy a house in their 20s so they can wallow in excess superannuation in their 70s.
This is not the only example of the ALP being taken over by the plutocrats. The recently released report on litigation funding by the Parliamentary Joint Committee on Corporations and Financial Services makes a powerful case that the litigation funding industry is perhaps the most egregious consumer rip-off operating at significant scale in Australia.
To quote from the report: “Australia’s highly unique and favourably regulated litigation funding market has become a global hotspot for international investors, including many based in tax havens and with dubious corporate histories, to generate investment returns unheard of in any other jurisdiction — in some cases of more than 500 per cent.” The committee found that this was the direct result of “light touch” regulation, and no successful action by a regulator against a funder.
The biggest losers are class action members. “When they finally get their day in court, it is the genuinely wronged class action members who are getting the raw deal of significantly diminished compensation for their loss, as bigger and bigger cuts are awarded to generously paid lawyers and funders,” the committee concludes.
The ALP, at both federal and state levels (especially in Victoria), has directly and affirmatively created the conditions for this rip-off. From the time then finance minister Chris Bowen exempted litigation funders from the applicable provisions of the Corporations Law in 2010, to more recent action by the Andrews government in Victoria to allow law firms to charge contingency fees, the ALP has moved proactively to make Australia a paradise for the world’s litigation bottom feeders and the plaintiff law firms that feast on their largesse.
Under the increasingly transparent guise of “access to justice” the ALP defends plaintiffs being manipulated and abused to feed the plutocrats of the class action litigation industry.
Given the evidence, how can the ALP continue to justify opposing decent consumer regulation and protection in this space? How did this happen? It’s simple. Stalwart Labor firms such as Maurice Blackburn, the biggest beneficiaries of slack regulation of litigation funders and new contingency fees, send money Labor’s way.
Once again, the interests of the ALP’s power elite and its donors ride roughshod over the interests of average Australians who ought to be protected from outrageous rip-offs by a properly regulated litigation industry.
It is no surprise that Labor is losing the average Australian. And the problem is far bigger than its current leader, Albanese. Labor’s ideological disconnect from mainstream Australians runs deep, across large swathes of the party, racing through the veins of other leadership contenders. Unless there is a political awakening, the plutocrats will continue to defeat the interests of workers. Soon enough the Labor Party will become known as the Plutocrat Party.
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