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crucifying the economy

In the previous postJohn Ralston Saul made the following comment about the failure of gloablization to deliver on its priomises:

"This was the crucifixion theory of economics: you had to be killed economically and socially in order to be reborn clean and healthy."

I mentioned Indonesia as an example. But the recesssion of the early 1990s in Australia caused bythe market-orientated Hawke/Keating Labor Government is another example. They and their pointy head economic advisors from the Treasury gave us the economic revolution of opening up the economy to the global market. For them the main game of politics was about the clean lines of economic fundamentals; everything else (eg. people's happiness) was fairy floss and decoration deserving mockery and condescension.

Then interests rates went to 20%.

I remember those years well. They are seared on my memory. I was teaching philosophy as an adjunct at the time, and I had bought a cottage in the inner city of Adeliade at the end of the 1980s boom. To keep the house I had to work 5 jobs. People lost their houses, their jobs, their businesses. Marriages and relationships broke up from the stress --mine did. It was hell. I detested the hubris of Keating and his devout, free marketeer economic advisors.

I loathed Paul Keating, the then federal Treasurer, for saying that it was 'the recession Australia had to have.' That remark highlighted the callousness and coldness of neo-liberal economic theory--it was utterly indifferent to the wellbing of human beings. All that mattered was the big picture: squeezing the boom and excess out of the economy. The Hawke/Keating Labor Government was returned to office then Hawke and Keating fell out over the leadership.

So when I started reading Don Watson's 'Recollections of A Bleeding Heart', I turned to his remarks on this episode. His memories are bitter ones. He says:

"When my wife and her partner lost the business they had built over 15 years, interest rates were as high as 20 per cent. Later, when I was in the job [Keating's speech writer], I could never repress a snarl whenever Keating said that those interest rates had 'de-spived' Australia'. It was true up to a point. Entrepreneurs who had been held up to us by both sides of politics as models of the new economy in the eighties were now either going broke or going to goal. The question was, who created the spivs? And who created the economics commentators the secular priests of our time, who for a decade had told us how to think and what to expect? They were not broke becaue they had never risked a dollar of their own, or backed an idea of their own and, sadly, I sometimes thought, they couldn't be sent to goal."

The 1990s recession was an example of cruxification economics. Watson says that when he returned to Melbourne in 1991 from Tokyo he found that city to

"....stunned and deserted. Empty shopsand lease signs everywhere, quiet streetsm, not a crane in sight. There was a kind of sullen silence in the air. Of all [the] recessions in my liftetime it was the only one to make you think the Depression must have been a bit like this."

This is a good example of an economy having to be killed economically and socially in order to be reborn clean and healthy.

The free marketeers were more than economists.They were ideologists since, secreted in their language of the free market, was a world view with its sense of false consciusness, historical inevitablity, special knowledge, the new order, the purges and cleansing. The pointy heads were crucifiers. They were into sacrificing people for the efficiencies of the market.

Posted by Gary Sauer-Thompson at February 28, 2004 09:24 AM | TrackBack