Billionaires blather

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Today we have a splendid example of everything that is wrong with Australian political economy. Rather than debate several important issues thrown up the huge wealth accumulated by a small number of folks, we have the usual political and ideological tribalism that reduces the issues to a kindergarten game of name calling.

Let’s start at the top, with Wayne Swan’s renewed attack on the “billionaires”. From the AFR:

Acting Prime Minister Wayne Swan will ramp up his verbal attacks on Clive Palmer, Gina Rinehart and Andrew Forrest today by accusing them of using their wealth to treat the courts, Parliament, and the media as personal playthings.

…“One tycoon is using his money to challenge the principle of fair taxation through electioneering; a second is using his money to challenge it through the courts; and a third is using her money to challenge it by undermining independent journalism,” Mr Swan will say.

The comments are likely to reignite debate about whether the Gillard government is more focused on wealth distribution than wealth creation, and suggest Mr Swan is worried about the party’s loss of its traditional working class support base.

But the Treasurer will take aim at critics who have accused him of seeking to inflame class warfare, warning Australia should avoid the “economic disaster” of an unequal society such as in the United States.

“The worst thing we can do as economic managers is create a society in which there are just a few at the top and teeming millions at the bottom, with hardly anyone in between…my only regret is not going in hard enough, because every criticism I made has been played out almost to the letter on our national stage”.

…Mr Swan will say Mr Palmer has sought to force his way into Parliament to overturn the government’s tax policies, Mr Forrest is using his wealth to fund a High Court challenge to the minerals resource rent tax, and Mrs Rinehart is “baldly seeking the power to manipulate public opinion” by buying into Fairfax Media.

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Right. The last time I looked, Clive Palmer had failed in his pre-selection bid and looked increasingly eccentric in his various initiatives. In short, checks and balances and Clive himself are taking care of Clive.

Andrew Forrest is using the courts to try to get a better deal for his company. What on earth is wrong with this? Again, checks and balances are working fine.

Gina Rinehart is a public policy issue. She has sought to control editorial coverage in the half of Australian media that defies her views. The media is a duopoly so that presents a real threat to the balance of Australia’s political economy, such as it is. A resources aristocracy that controls the media is a classic hallmark of the Banana Republic.

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So, Swan has mashed together an attack on three individuals that have little in common in terms of the practical implications for Australian society. All three may be opposed to paying higher taxes but that does not mean all three are a threat to democracy and its structures.

So, what does the media do with this? Tony Walker wastes most of an article analysing Bruce Springsteen before finally giving us this:

The Treasurer insists he is not arguing against entrepeneurship, rather rent-seeking crony capitalism.

Australia needs a public debate about what to do about the benefits that flow from the largesse that accrues from our good fortune for the benefit of future generations.

Equally, the country’s interests will not benefit from singling out a particular group of individuals for criticism, rather the question becomes how to improve what the Americans would describe as a “perfect union.’’

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So give us the debate then. If singling out a particular group makes no sense then neither does defending the same group.

Which is exactly what Tony Abbot does in his riposte today. Fresh from his Great China Gaff and no doubt very grateful that Swan has shift the spotlight, he wades in:

I think this is a treasurer who should be governing the country, not getting out there attacking people,” he told reporters in Melbourne.

“Wayne Swan talks about dividing up the cake. The problem is this government had devoured the cake.”

The government was about destroying wealth not creating it, Mr Abbott said.

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What does that even mean?

Meanwhile, over at The Coalition Pamphlet, Judith Sloan offers her usual ideological refrain:

Here’s a tip – for anyone who is interested in thinking about policies that really improve community wellbeing, the better source references are Adam Smith, David Hume, Edmund Burke and David Ricardo. Harder work than learning a few catchy lyrics, but affording much more insight into the factors that lead to widespread prosperity.

Wayne’s view of society has much in common with that of the Occupy crowd. If only we could get rid of the top 1 per cent, we could all be better off. Slagging off at Gina, Clive and Twiggy makes sense in Wayne’s World.

But in a free democratic society with an independent judiciary, Gina has every right to purchase shares in a listed company; Clive has every right to participate in politics in any way he wishes; and Twiggy has every right to take legal action to test the validity of a new tax. Would the Acting Prime Minister really want it any other way?

A series of ideological binaries does nothing to illuminate the issues we face here. They are:

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  • how can vested interests be prevented from distorting political process and the national interest?
  • what are the boundaries of a free press and how should they be protected?
  • what is a fair level of taxation for extractive industries
How about we debate these instead of pointlessly throwing around billionaire blandishments?
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.