Gary,
though Rudd comes out of the anti-intellectual Queensland Old Guard----the old DLP types--- and is naturally aligned with the Australian Workers Union groupies run by Bill Ludwig--- your link to a review of Reich's 'The Work of Nations' indicates how much Rudd has aborbed Reich's ideas. Rich's book underpins, or provides the backbone for, the face of modern Labor.

The reviewer says that Reich divides American jobs into three broad categories for assessing their contribution to new the global economy.

These are "symbolic- analytic" services, routine production services, and "in-person" services. The first of these is carried out by what Reich calls "symbolic analysts" engineers, attorneys, scientists, professors, executives, journalists, consultants and other "mind workers" who engage in processing information and symbols for a living. These individuals, which make up roughly twenty percent of the labor force, occupy a privileged position in that they can sell their services in the global economy. They are well-educated and will occupy an even more advantageous position in society in the future.

On the other hand:

Routine production workers and in-person service workers will fare much worse in the new economy, according to Reich. Routine production workers include those who perform repetitive tasks -- assembly line workers, data processors, foremen, and supervisors. Examples of in- person service workers are waitresses, janitors, hospital attendants, and child care workers. These two categories of workers do not compete in the global work force and are at a considerable economic disadvantage. This is especially true of routine producers. The future of service workers is less clear cut since their services are in demand by symbolic analysts.

There you have a more sophisticated account of the divide between the inner city professionals and the battlers, aspiring or otherwise.

Nan,
modern Labor talks in Reichean terms---eg., Beattie's Smart State---the numbers of Australians who could become analyists. I'm not sure whether the Smart State aims to increase the number of those who could apply symbolic analysis to production and in-person services;

Kim Beazley said he wanted to be known as the "education Prime Minister." But federal Labor hasn't been prepared to fund their vision--- to provide opportunities for all Australians to become symbolic analysts---by investing in education at all levels.

In a globalized world the economic fates of Australians are beginning to diverge. Those working in "symbolic- analytic" services, routine production services, and "in-person" services are in different boats: one sinking rapidly, on sinking more slowly, and the third rising steadily.

The stark political challenge presented by this new economic picture is the prospect of deepening social divisions. Reich says:

America's problem is that while some Americans are adding substantial value, most are not. In consequence, the gap between those few in the first group and everyone else is widening.

Hence all the ALP'social inclusion stuff to help those being left behind.

Nan,
I agree. Reich has been trying to plot political strategy for attaining largely social democratic ends though largely neoliberal means.

The Work of Nations was an attempt to grapple with how the coming of the second great era of globalization and information technology together change the balance of political-economic forces in the world's most developed economies.

The ALP tacitly accept that a corporation's only obligation is to maximize profits or, equivalently, stockholder wealth - the view of Milton Friedman. So the government needs to intervene in education. However, they also accept that global economic forces have imposed, and will impose, strict fiscal and regulatory limits on governments at all levels.So they will be reluctant to impose higher taxes or any other extra burdens. that limits government-backed welfare, health or public education efforts.

Peter S.
Brad Delong puts the situation well in terms of Clinton in the US in the 1990s in his A Program for Economic Policy Watchers:

Liberal initiatives--in welfare reform, in health care, in education--cost money. Money is easy to find if long-run growth is rapid. Money will be impossible to find if the long-run productivity growth trend remains slow. And unless long-run growth accelerates Bill Clinton or his successor will face the awful political task either of telling America's elderly that the country has promised them more in medicare, social security, and pensions than it can deliver, or of telling America's taxpayers that they must finance benefits for those who are old in 2000 at levels that those who will be old in 2030 will never receive. Many things are possible if the productivity slowdown is reversed. Few things are possible if American productivity remains stagnant.

Rudd's argument is that the commonwealth government should plan to use the resources of the resources boom to drive productivity growth.

Reich's core argument in the Australian context is an education one. The slow productivity growth is traced to the relative decline of Australia' s educational system. What is needed is investment to ensure well-educated and well-trained, not just Howard's return basic standards for the working poor.

Secondly, Australia's workers will be able to compete with workers in other countries for high-wage high-productivity jobs only if they are well-educated and well-trained.

Thirdly, capital flows to the place where the workers are most skilled, that boosting savings does little good and boosting investment is impossible unless Australia's 's workers offer potential multinational employers the best package of skills.

Gary,
Paul Keating's neo-liberal view was that increasing economic integration is a good thing-- an integrated global economy.

Where the neoliberal view of the world is weak is in its bet on globalization--its bet that a tightly-integrated global economy, with large flows of capital and goods (and, to the extent industrial core governments permit, of labor) is a richer and faster-growing global economy. Large flows of capital can be good and they can be dangerous.

It would appear that the opposition to neoliberalism on the left---during the Beazley years?---is an economic nationalism, which calls for a return to effective autarchy, or to a return to greater state control of the economy.

Reich's work promises a way through this duality that characterised the politics of the 1990s.

And opposition to neoliberalism on the right seems based on a fear that neoliberalism will bring with it a breakdown of an authoritarian social order: eg., workers will no longer obey bosses and voters will no longer respect the views of the noble political class.

Nan,
the Costello/Howard crowd appear to be denying that middle-income Australians have failed to share in the economic growth of the last decade.

1. they deny that their tax cuts from the late 1990s were a step in tilting the distribution of income and wealth in the direction of the rich;

2. they deny that the Workchoices legislation is union-busting that lowers the bargaining power--and wages--of Australians working in manufacturing and service jobs;

3. they deny that the budget surpluses since the late 1990s have not been used for public investment that boosts productivity and wages.

Some economic reality is intruding. I hear your pain says the PM. I understand what you are saying about increasing costs of living, lowering housing affordability, falling house prices etc.

However, Howard and Costello remain opposed to a powerful program of public investment to provide the technological and physical infrastructure needed for a growing economy;

and opposed to a powerful program of human capital investment to make it much easier for workers to acquire the skills and experiences they needed to become more productive.

Gary,

Numbers aren't my strong point so I'm probably being silly here, but hasn't the surplus been substantially larger than anticipated for several years now? Couldn't you count on a couple of billion there?

Pulling out of Iraq would save, but then again we'll probably be out of Iraq and in to Afghanistan, so that wouldn't help.

How much could be saved on government advertising, Nauru, Baxter and Christmas Island, reducing RAMSI, corporate welfare, middle class welfare? Probably not enough.

Gary,

Howard used the debate to announce a plan to subsidise power bills for pensioners. I'm not certain I've got this right, but I think the plan is to set up yet another fund using the money from carbon fees or pollution licenses or whatever they're called, and use the money to cover increased power costs for pensioners.

It sounds reasonable, given that pensioners skimp on power to save money. On the other hand, yet another fund. How hard would it be for Labor to unlock some of the money allocated to these funds?

Lyn,
it's probably less a lack of money---given the resources boom---and more an unwillingness to be seen to be economically irresponsible by funding public education to upskill school kids, so they can participate as skilled workers in the information economy.

Tax cuts are seen to be economically responsible (achievable and affordable) whilst funding increased public services is irresponsible. With the latter it is still a case of doing more with less---increased workloads and reduced patient care, as the nurses dispute in Victoria indicates. That dispute becomes ever more bitter as the Workchoices legislation cuts in.

Are tax cuts always economically responsible?

According to the AFR the tax cuts amount to $80 billion over the next five years. It's a lot of money. Admittedly, some of these are aspirational tax scales---beyond 3 years, beond the life of the next Parliament--- and they may never be implemented. The boom may well collapse after 3 years.

It's looking reckless--a political race to throw money around that fuels aggregate demand. The banks are warning that the price of credit on loans is increasing, inflationary pressures are continuing to building up, and its only a question of when the next interest rate happens. Monetary policy and fiscal policy are going in opposite directions instead of working together.

No worries say the neo-liberals. The extra money for households from the sensible tax cuts will be used by rational consumers to pay off the credit card and mortgages so as to reduce monthly repayments. That means more money for these aspirationals to buy a private education for their kids.

Lyn,
Howard's plan to subsidise increased power bills for pensioners comes out of his own emmissions taskforce report. That proposed that the billions of dollars the government will earn auctioning greenhouse emissions permits to businesses should be spent on making the economy more efficient.

This is flawed. Giving cash bonuses to low income workers would destroy the price signal to bring their emissions down. It is much better to provide incentives to upgrade the energy efficiency of the average home as the Greens propose.

Gary,
I see that Kevin Donnelly reckons Labour's 'we are the future' rhetoric needs to be challenged.

Kevin Rudd's so-called education revolution and his final folksy comments about an idealised past, where mum and dad sent their kids off to the local state primary school for a good education, have gone unchallenged. Rudd's argument that the ALP's commitment, if elected, to spend billions of tax dollars on education on the basis that spending more represents "the essence of an education revolution" also has been accepted as beyond reproach.

He addresses Rudd's argument that Australian students are IT-deprived and that computers and the internet are crucial to raising standards. This is more spin than substance, he says:

As many parents know, home computers often distract students from learning, especially in the key areas of mathematics and reading, and research about how children best learn shows that memorisation and rote learning are crucial if students are to develop higher-order skills.

Memorisation and rote learning are the key to the future. Really? What of critical thinking skills?

Donnelly says that Howard was wise to concentrate on the three R's in the great debate:

Howard's concluding comments illustrate why he is such a formidable political opponent. Not only is he a conviction politician when it comes to education, somebody who has consistently argued against new-age and politically correct fads such as black armband history and postmodern gobbledegook, but Howard understands the electorate.

So Australian students becoming IT-literate so that they have analytical or critical skills re computers and the internet is seen as postmodern gobbledegook.

How can anyone take this conservative stuff seriously?

Gary
re your comment

it's probably less a lack of money---given the resources boom---and more an unwillingness to be seen to be economically irresponsible by funding public education to upskill school kids, so they can participate as skilled workers in the information economy.

So why hasn't this public investment happened, given all the education talk over the last decade?

It smells of class to me. That higher IT skills are to be taught by private schools who educate the upper echelons of the workforce. Public schools are for basic education for the working poor. Australia is effectively taxing the working poor to subsidize educational opportunities for the middle class and the rich. So much for an egalitarian society.

Since it is expensive to provide for a good education, it is outside the financial reach of the working class. So they have to forgo a good private school education for their kids, send them to a public school, and take second or third best because public education is underfunded.

Their unhappiness about this state of affairs is dismissed as the politics of envy.

Gary,

I'm being optimistic I know, but if Howard can massively increase immigration, while dog whistling, with nobody noticing, why can't someone else do something positive for public education that goes under the radar? There's a fine but relevant distinction between policy and its implementation.

Nan,

That's why it's offensive to the cat to line the litter tray with a Donnelly piece. To prepare them for the real world kids need both IT and critical thinking skills. Imagine confronting some of the stuff on the internet without critical thinking?

Rote learning is useful for maths where there's no other way to remember formulas, but it's inappropriate for English where 'i before e except after c' only works some of the time and knight is not pronounced kerniggit. It's too late to go back to the pretend version where Australian history started with Captain Cook.

Fortunately, it's too late for Donnelly altogether. Like all heavily bureacratic institutions, education has the turning circle of the Titanic. In the decades it would take to turn education into DonnellyWorld, new teachers armed with critical thinking skills would be heading up classrooms and Donnelly would be watching his dentures float in a glass on the bedside table.

What an excellent thread. Not a wasted word from fourteen posts so far.
Wondered if I was alone in feeling huge reservations about the future, but see that from Nan's exellent first-up post fleshing out the gist of Gary's point, setting the agenda to the subsequent replies successfully colouring the basic sketch.
Have just come from reading the Age, with its eye opening accounts concerning the now- brutal Victorian hospitals industrial action and the acompanying Paul Austin thumbnail of Vic Premier Feral-Ass.
How much more simple and rewarding for all had he just followed federal labor policy concerning IR instead of embarking on behaviours that would shame even oafs like Abbott and the obnoxious Mal Brough.
Is Brumby trying to jeopardise Federal Labor more effectively than all the Tory politicians combined have succeeded in doing over nearly a year?
Why...??
Surely his federal colleagues must feel SOME embarrassment, because of him?

Paul,
if Australia is to maintain its economic prosperity into the future then to do that, our universities must produce the knowledge workers who will define that future.

It is pretty obvious that those knowledge workers will also be increasingly crucial to Australia's capacity to tackle the pressing concerns over global warming, energy, water conservation, sustainable economic growth and preserving the environment.

So where is the funding for this? Where are Howard's policies and fundding to help make this happen in Adelaide. What got was funding for senior high schools to train 11 and 12 year students in defence related engineering, IT and trades (welders, electricians, carpenters, plumbers etc) skills. They are low to middle grade defense workers that will help to address the skills shortages in the military.

Paul,
you have good cause to have huge reservations about the future---the Howard Government was openly hostile to the higher education sector when it was elected and has never recovered from that, despite the efforts of Nelson and Bishop to improve things.

It's education has policy has been directed at the basics and exams for public schools and trades for post secondary. It has viewed TAFE as captured by the unions and seen the universities through the prism of the culture wars.