I recently participated in a Roundtable on “Assessing the Accord and Labour’s Role in Neoliberalism” – along with Sarah Gregson, Labour History Deputy Editor; Frank Bongiorno, ANU Professor of History; and Ian Hampson, Honorary Professor at Centre for Workforce Futures, Macquarie University. The aim was to air a diversity of views on the Accord period. The context for this discussion is Elizabeth Humphrys’ very readable book, “How Labour Built Neoliberalism”. Elizabeth Humphrys is a political economist who teaches and researches in the School of Communication at the University of Technology Sydney.
ROUNDTABLE – Assessing the Accord and Labour’s Role in Neoliberalism
Elizabeth Humphrys, How Labour Built Neoliberalism: Australia’s Accord, the Labour Movement and the Neoliberal Project (Leiden: Brill, 2018). pp. xx + 268. AUD $163.00 cloth (Chicago, IL: Haymarket Books, 2018). pp. xx + 268. AUD $39.00 paper.
A PDF of this book is available here – https://b-ok.global/book/3631447/352c73.
Introduction: Sarah Gregson, Deputy Editor, Labour History
In 2018, the publication of Elizabeth Humphrys’ book How Labour Built Neoliberalism sparked considerable interest with its thought-provoking arguments about “vanguard neoliberalism,” the 1983–96 Prices and Incomes Accord, and the significance of this “social contract” for the fortunes of the Australian union movement and working people. The Sydney launch of Humphrys’ book, which I attended, attracted a large and diverse range of people, including young students interested in the period as “historical”; older people who had lived through it as workers, activists and academics; and Australian Labor Party (ALP) supporters interested in understanding this crucial element of their party’s political path. Given this range of interest, and because the Accord period is so contentious, a single review of this book seemed insufficient and risked prioritising one perspective over the many others we could have solicited. Alternatively, a “roundtable” approach would air a diversity of views that capture the debate about this important period in Australia’s history, particularly within the labour movement.
Elizabeth Humphrys is a political economist who teaches and researches in the School of Communication at the University of Technology Sydney. Humphrys’ account of the Accord period in How Labour Built Neoliberalism takes issue with those commentators who presuppose that the Accord and neoliberalism embodied radically different tenets. On the contrary, she writes, the project of restoring respectable levels of capital accumulation in Australia after the economic crises of the 1970s involved both a social contract and neoliberalism operating in tandem.1 Drawing union leaders into a national, or corporatist, effort to increase profitability – and so it was argued at the time, create jobs and allow trickle-down social benefits for workers – laid the basis for an entirely neoliberal agenda that instead prioritised the market, removed industry protections, gutted protective regulation, undermined government obligations for social welfare, and encouraged notions of individual, rather than collective, social responsibility.
Humphrys argues that, after seven years of Fraser Liberal–National Party coalition government strategies, the straitjacket of wage restraint could not have been achieved by the business sector acting alone. Although the industrial wars of the 1970s had been to some extent enervating for the labour movement, union membership density and organisation made it, paradoxically, well placed to deliver the extent of change required by capital. She also demonstrates that labour leaders were attracted to the idea of a social contract with government, swayed by the promise of seats at various influential tables.2 In return, however, the one-sided deal they struck – wage restraint and industrial passivity in return for increases in the social wage – precipitated union membership and organisational decline, fractured delegate networks, delivered bargaining outcomes capped at levels equivalent to wage and condition cuts, and delegitimised industrial action as an appropriate response to capital’s onslaughts.
Therefore, Humphrys’ work is a much-needed corrective to the celebratory air at the Accord’s 30th anniversary celebrations that Humphrys evocatively describes as akin to “a party in a cemetery.”3 Her research uses insights from Marx, Gramsci and Panitch to develop an analysis of how the Labor government implemented the Accord process to “enwrap” civil society in a national project of restructuring and, in so doing, effect a significant transfor- mation of the economy, politics and industrial relations.4 In pointing out some of the unique characteristics of neoliberalism’s triumph in Australia, Humphrys enriches our understanding of the different pathways and contexts, including the incorporation of the labour movement, that can bring about such dramatic economic and social transformation in the interests of capital without massive social unrest.
She also documents how, rather than risk damaging Labor’s electoral fortunes, union leaders continued to support the Accord strictures to their own and workers’ detriment until both were soundly punished – the union message about the efficacy of joining fell more frequently on deaf ears and Labor was booted unceremoniously out of office. Her analysis shows that, far from placing union members in a strong position, workers and their organisations suffered defeat after defeat during more than 11 years of subsequent Liberal–National Party government. Furthermore, when Labor regained office in 2007 – a victory widely attributed to grassroots organising by union activists – union officials proved even more unwilling/unable to insist upon enactment of Kevin Rudd and Julia Gillard’s meagre industrial electoral promises.
From Humphrys’ work, I came to realise that, despite a reluctant recognition that Labor’s electoral fortunes rest to some extent on support from working-class voters, ALP leaders demonstrate a fearful determination to contain the “genie in the bottle” – a spirited, organised working class able to set industrial agendas and make it difficult for governments of any political persuasion to govern. That fear leaks out of every clause of the Fair Work Act 2009 with its limitations on lawful industrial action and meagre general protections. As a result, the legacies of Accord compromises take the form of employer successes on a range of fronts likely not thought possible in 1983 – burgeoning precarious employment, wage theft, and little or no union presence in the vast majority of workplaces. Of course, and only slightly tangentially, these defeats for labour occurred simultaneously with ballooning executive remuneration. As the book points out, a now manifest weakening of union power and influence through profound disorganisation means that, even if there was pressure for a new social contract, it is unclear what sort of bargain the labour movement could strike. She asks: Why would employers feel any need to call for such an initiative?5
To look at these issues from different angles, we invited two academics – one a historian and one an industrial relations scholar – to contextualise the period and the issues the book raises. We also invited comment from activists in the labour movement – a former politician and a former senior union official – to engage with the book and offer commentary from their unique perspectives.
Our first discussant, Frank Bongiorno, is Professor of History at the Australian National University and researches and writes across a broad range of topics in Australian labour, political and cultural history. In 2013, he published a scholarly book entitled The Sex Lives of Australians that was considered for the Prime Minister’s Literary Awards. Although anyone buying the book for a rollicking read would have been acutely disappointed, apparently the topic was still too racy for then Prime Minister Kevin Rudd, who overturned the expert opinion of a panel of judges and awarded the $75,000 to the author of a much safer topic – war.6 Frank’s recent book, The Eighties: The Decade that Transformed Australia, published in 2015, addresses both the top-down efforts of Labor leaders to re-engineer the Australian economy and the economic distress of families affected by labour market restructuring and union incorporation into the Accord project. The degree to which the ALP was prepared to enforce Accord strictures on reluctant unions who might respond with the oft-touted and much-demonised “wages breakout” is outlined in Bongiorno’s discussion of the brutal deregistration process inflicted on the Builders Labourers Federation whose leaders did not support the plan to deliver wage cuts in return for deferred superannuation benefits.7 In the battle to marry economic growth with social justice principles, this was one example among many which demonstrated that, for both Labor and Liberal governments, the market would always come first. In his essay below, Bongiorno’s analysis of the book draws on personal, political and historical insights to ask for an approach that balances acknowledgement of the achievements of the Hawke–Keating era with justified criticisms of its shortcomings.
Ian Hampson, our second discussant, is Honorary Professor at the Centre for Workforce Futures at Macquarie University. Prior to his appointment there in 2018, he worked for many years in the UNSW Business School, teaching and researching on industrial issues – work, employment relations, human resource management, and training and skills policy, particularly in relation to aircraft maintenance safety, licensing and regulation. In 1991, with Peter Ewer, Chris Lloyd, John Rainford, Stephen Rix, and Meg Smith, he published Politics and the Accord,8 a book designed to enflame debate within the union movement about ways to make the Accord operate more in the interests of working people via industry development and a revitalised training agenda. Hampson and Humphrys have engaged in friendly public debate about the legacies of the Accord period on a number of occasions. Despite elements of furious agreement, we wanted to put some of that debate into print so that others might consider, in particular, their key points of difference. For Hampson, in the essay that follows, the Accord was an opportunity for the labour movement to engage with government and industry in “mature” policy development. However, the early promise envisaged by Labor leaders, particularly those on the left who proselytised for the Accord’s acceptance, was undermined by economic rationalist agendas that jettisoned social protections in pursuit of business priorities. He asks: What insights can this debate offer for the prospect of any future social contract?
Lee Rhiannon sat in the New South Wales upper house from 1999 to 2010, before being elected as a New South Wales senator for the Australian Greens in the 2010 federal election, a position she held until late 2018. From a left-wing family and involved in social movement campaigns all her life, Rhiannon knows only too well the importance of strong union backing for achieving progressive change. She witnessed the declining power of unions as the industrial effects of the Accord period deepened and how this dramatically curtailed what unions could offer social movements in terms of muscle. For her, the strategic intent of “social contracts” had form and likely outcomes could be predicted from past practice. As time passed, it became more and more difficult for Left activists to influence the internal policy debates of social democratic parties as the traditional strategies of the labour movement – strong organisation, economic clout, strikes and mass protests – were publicly discredited by media, politicians and even some union officials as old fashioned and inappropriate in a “post-industrial,” “knowledge” (insert latest buzzword) economy. For Lee, this only underscores the importance of recovery from the Accord and how we might revitalise workplace organisation and rebuild a union movement independent of party political exigencies.
This is a question that also preoccupies our final discussant, Tim Lyons. Now a research fellow at think-tank Per Capita, deputy chairman of a large industry superannuation fund, and a director of a state-owned utility, Lyons has more than 20 years of experience in the trade union movement as an organiser, advocate, policy specialist, and senior leader. In 1995, he began working for the National Union of Workers at the tail end of the final Accord, and then worked for several years as the assistant secretary of the Australian Council of Trade Unions (ACTU) where he was responsible for organising programmes on labour law, economics and pensions. Shortly after his departure from the ACTU in 2015, Tim published an essay in Meanjin entitled “The Labour Movement: My Part in Its Downfall,”9 lamenting the predominantly electoral focus of contemporary Australian unions. For many workers, he wrote, unions were only visible during election campaigns and corruption scandals. In this context, the role of the union in workers’ lives “becomes not something about your work and your life, but an organisation that periodically tells you how to vote.”10 In his contribution below, Tim argues that the labour movement must learn from the cautionary tales of the past, as outlined in How Labour Built Neoliberalism, and restructure in ways that can meet the challenges faced by the workforces of the future.
To conclude, and to chart the parameters of a debate we all feel must continue, the author, Elizabeth Humphrys, was also invited to contribute some concluding reflections on the perspectives we have gathered here. Like her and all the discussants, we at Labour History hope that this small contribution to analysing the Accord period can focus renewed attention on its lessons as a springboard for union movement renewal.
Discussant 1: Frank Bongiorno, Professor of History, Australian National University
The arguments began in the mid-1970s – or at least that is when I first became aware of them. The subject was money. There just was not enough of it. My father was a storeman, working for an industrial dry-cleaning company called Ensign Services, in a northern Melbourne suburb; the business was later incorporated into the Spotless Group. He had gained the job at the age of 50, in 1973, having been in business in a Victorian country town all of his life. The family businesses had failed in the early 1970s; he had had a nervous breakdown; and having, as a widower, married for the second time only a few years before, he had a wife and two young children to support. The family rented a run-down weatherboard house – complete with backyard toilet – owned by my mother’s parents.
His wage was presumably insufficient to support his family, and some time in the mid-1970s he took a second job at the Catholic primary school where my sister and I were enrolled, doing the cleaning on a Saturday morning. The main task seemed to be the decidedly unpleasant and presumably unhealthy job of emptying the ashes from an incinerator in the schoolyard. Eventually, that second job came to an end, but my mother was employed as a teacher’s aid at the same school. The arguments stopped; the second wage must have done the trick. After my father died of cancer in 1982, it would be the combination of his superannuation lump sum and her modest salary that saw us through school and on to university.
Elizabeth Humphrys’ important book on the making of Australian neoliberalism takes us though these years. In many ways, her starting point is the time my family moved from the country to Melbourne: the end of the long boom. That was accompanied by a deep political crisis, represented initially by the decline and then dismissal of the Whitlam government, but equally by the inability of the Fraser government to resolve many of the same issues that had bedevilled Whitlam. Among the most significant of these was inflation, but Humphrys sees the wider context as the decline in profitability and accumulation, in the context of an empowered union movement that still represented about half the workforce, was largely immune to legal sanctions after the Clarrie O’Shea strike in 1969, and was more than willing to use its industrial muscle.
Fraser cannot say that he was not warned. Ian Macphee, a former director of the Victorian Chamber of Manufacturers and a federal Liberal parliamentarian, told him in early November 1975 that if the government managed to win office stemming from the constitutional crisis, it would gain the hostility of nearly half the electorate leading to “a decade of extremism and instability” in which its industrial relations policy “would have no chance of working. The trade union movement would feel justified in destroying our government as they believe the Senate destroyed their government. Legalities would be of no consequence to them.”11
The strength of the union movement in the 1970s is critical to Humphrys’ argument about why neoliberalism happened in the 1980s under Hawke and Keating and not in the 1970s under Fraser. In short, the Coalition was in no position to enforce it even if it had been more interested in doing so – and, at least so far as the likes of Fraser and Deputy Prime Minister and National Country party leader Doug Anthony were concerned, they were not terribly interested in doing so. The government did not confront the unions in the way that Ronald Reagan did the air traffic controllers in 1981, Margaret Thatcher the miners in 1984–85, and even Bob Hawke the airline pilots in 1989. Nor did Fraser take on other neoliberal reforms associated with the era of what Humphrys called Australian “vanguard neoliberalism” in the 1980s.12
In 1977, Fraser was deeply critical of the Industries Assistance Commission when it recommended tariff cuts in clothing, textiles and footwear.13 He subsequently appointed Sir John Crawford to enquire into structural adjustment in Australian manufacturing, a committee to which Fraser also appointed ACTU president Bob Hawke. The committee, when it reported in 1979, unsurprisingly recommended a steady-as-she-goes approach: there should be no across-the-board tariff cuts until unemployment was under 5 per cent.14 Similarly, although the government asked businessman Keith Campbell to enquire into the financial system, and Campbell recommended deregulation when he reported in 1981, the key recommendations in the report of over 800 pages were not implemented.15
Humphrys’ account seems to me to offer three important innovations in the interpretation of the era. All are worthy of serious consideration. The first – and, to my mind, the most significant and exciting aspect of her argument – is that she challenges the idea that neoliberalism can be understood as having appeared in its most pure and influential forms in Thatcher’s Britain and Reagan’s USA (and possibly, earlier, in Pinochet’s Chile) from where it spreads elsewhere – often in less pure form. Her alternative is to suggest that there have been a variety of paths to neoliberalism and that, in the Australian context, it was less a New Right and more a Centre Left project. The key players in the making of Australian neoliberalism, she argues, were the Australian union movement and the Hawke and Keating governments.
Late in the book, she then draws on this finding to reread a range of other neoliberal pathways internationally, such as in the UK, the USA, New Zealand and Finland, asking about the role of organised labour and parties of the Left in those instances. In line with ideas of “Southern Theory” as developed by Raewyn Connell, Humphrys’ approach is not simply to offer Australia as a footnote or sidelight to international studies that largely ignore the Australian case and place Thatcher and Reagan in the foreground.16 Rather, she suggests that considering the distinctive Australian experience might both complicate and enrich our understanding of the emergence of neoliberalism globally.
A second line of argument in the book is to treat corporatism and neoliberalism as complementary phenomena rather than in tension in the Labor governments of the 1980s and 1990s. Here, Humphrys enters long-standing debates about the use by centre-left governments of social contracts – such as in Britain during the 1970s and in Australia during the 1980s and 1990s under the Accord. It has been common enough for those writing on the Hawke and Keating governments to treat the economic rationalist/neoliberal aspects of policy as having almost a separate existence from the “social wage.” The government, it is argued, pursued policies such as financial deregulation, the winding back of tariff protection, the replacement of industrial arbitration with enterprise bargaining and privatisation, but in a way that avoided the worst excesses of Reagan and Thatcher. In place of a new Right worship of markets was a continuing commitment to the use of the state to temper the effects of a capitalism freed from its post-war shackles.
Humphrys’ argument is that the corporatism of the Accord was the means by which the union movement was brought into this project. Drawing on Gramscian Marxism, she argues that the Accord was a collaborative project in which the state, as an instrument of class rule, sought to contain civil society. While such projects are inherently unstable because they involve the contra- dictions of social relations under capitalism, the Accord largely succeeded in drawing the union movement into a project of “national consensus” after a period – during the 1970s – when it had practised industrial militancy and increased labour’s share of national income. Because it required collaboration, the Accord was a project the Fraser government could not seriously contemplate: it took a party of the centre left, in partnership with union leaders, to bring the unions inside the tent.
As it happened, Humphrys suggests, this was a fatal move for the unions, as it resulted in their being crippled by the effects of neoliberal policies. Left union leaders who thought they had gained a place at the policy table and perhaps even detected a road to socialism had no escape hatch once the government pursued spending cuts and failed to protect living standards. A Labor government that had promised to tackle unemployment and inflation at the same time, as an alternative to Fraser’s “inflation first” approach, found itself in much the same position as the Coalition: overwhelmingly preoccupied with fighting inflation. For Humphrys, this was a case of another Labor government performing its historical role of trying to make capitalism work, on the grounds that jobs and wages ultimately depended on the capitalist system’s capacity for accumulation. But that system’s propensity for instability and crisis meant that such an approach was not one that benefited the workers it was supposedly designed to serve.
There is obviously a great deal here that rings true. Recognising that unions were in the early 1980s strong and feisty, it helps explain why no government in Australia was able to do what Thatcher and Reagan (or, rather, Paul Volcker, Federal Reserve chairman under the Carter and Reagan administrations) had done in the early 1980s: use vaulting unemployment to defeat inflation. That came in Australia in the early 1990s recession; that is, in Humphrys’ terms, in the latter phase of “vanguard neoliberalism.”17 These differences have inevitably given rise to the kind of counterfactual argument to which Humphrys objects: that the Accord, and the existence of a Labor government more generally, led to an avoidance of the worst excesses of Thatcher or Reagan.
It is easy enough to understand her impatience with this kind of case, which all too often becomes special pleading (or, for the most pessimistic, the idea of Labor as the lesser of two evils). But it is also true that Humphrys’ model ignores or struggles to incorporate some aspects of the undoubtedly constructive policy that occurred: Medicare, environmental protection, the Sex Discrimination Act, the capital gains tax, the fringe benefits tax, the superannuation guarantee, targeted family payments, improved school retention rates, and a significant expansion of tertiary education – the last funded, it is true, partly by the reintroduction of fees and, in due course, by the expansion in the private market for international students. But is it sufficient simply to see all of this as part of a Labor corporatism that ultimately helped to advance neoliberalism and wreck union power?
Certainly, at the time, there was a more aggressive neoliberalism critical of the Labor government for preferring, for instance, the middle way of income-contingent deferred university fees to upfront charges. The Coalition was also remarkably persistent in its efforts to get rid of Medicare. It opposed Labor’s tax reforms for their supposedly deleterious impact on business, and it opposed compulsory superannuation as a union racket. It is in many ways remarkable that simply because the Coalition often supported Labor’s decisions in areas such as financial deregulation and privatisation, it is said to have given the Labor government a series of free kicks in the 1980s. It is perhaps unfair to criticise an impressive work of political economy for not being a work of political history, but I do wonder whether Humphrys gives enough weight to the political contest itself, which invariably conditioned what the government could do.
It is true that the Labor government’s embrace of balanced budgets, its retreat from Whitlamite universalism in social welfare, and its broadly pro-market attitudes can all be seen in the context of rising neoliberalism (or economic rationalism, as it was more commonly called at the time). The work of Emily Millane, for instance, is showing that the combination of the Accord’s corporatism and the neoliberal climate of the era was critical in shaping the nature of the superannuation system with which Australia ended up. The government did not seek to introduce a state system of the kind that had been Labor policy for some years and which had been recommended by the majority report of an inquiry appointed by the Whitlam government and led by the economist Keith Hancock. Rather, Australia ended up with a superannuation system that was an adaptation of long-standing occupational systems, and which extended the industry schemes achieved through individual union campaigns of the later 1970s.18
Context should matter to historians. The research tells us that Australians of the 1980s wanted lower and not higher taxes, so there was limited scope for increased spending – such as an expensive government superannuation system that would have demanded higher taxes – and a strong motive for government to target spending more carefully to areas of need.19 We can now appreciate some of the problems with targeting of this kind, such as its promotion of a kind of downward envy, but Australia’s tax and transfer system has been rather good at channelling money to those on the lowest rungs of the economic ladder.20 To say as much is to seem to wish to apply to join the Hawke–Keating cheer squad. Yet, my own work on the 1980s has been deeply critical of the celebratory approaches to that era, although often from a different perspective to Humphrys’; one that invites the reader to examine the evasions – then and since – that have always been demanded of anyone who wished to present the 1980s as a glorious era of reform comparable with the achievements of post-war reconstruction.21
That observation about how we might see the era of “vanguard neoliberalism” in the longer sweep of Australian history brings us to the third achievement of Humphrys’ book: she introduces us to a new periodisation of modern Australian history. There are some journalistic accounts of this era that emphasise the continuities of the Hawke–Keating and Howard governments, a reform era usually understood in terms of a commitment to pro-market reforms such as tariff reduction, enterprise bargaining, privatisation and competition policy.22 Yet Humphrys points out that in many ways, the pioneering and dynamic phase of neoliberalism in Australia had run its course by the time the Coalition came to power in 1996 (Howard is seen to represent a “piecemeal neoliberalism”). She also locates “vanguard neoliberalism” as both a product of, and a reaction against, the capitalist crises of the Whitlam and Fraser years, which she characterises as the “proto-neoliberal stage.”23
This is all very stimulating, and it opens up possibilities of which Humphrys is, of course, very aware for trying to explain recent levels of disengagement from the political process. To what extent can we interpret public disillusionment with politics in the present as a product of the working-class demobilisation that Humphrys sees as attributable to the Accord? And to what extent is our capacity to do anything about it limited by the drastic decline in union power that has occurred especially since the Accord era and, at least partly, as a result of the Accord itself, if Humphrys is right?
I cannot answer these questions any more than Humphrys can, but she has offered us new opportunities to think about them.
Discussant 2: Ian Hampson, Honorary Professor, Centre for Workforce Futures, Macquarie University
Elizabeth Humphrys has done a great service for academic debate in Australia by near-singlehandedly reviving critical academic discussion about the Accord, not least because there has been some talk of a new one. I agree that, as she puts it, “the neoliberal political project was made possible in Australia through the active participation of the union movement in the Accord process” and that the Accord and its aftermath have largely wrecked labour’s industrial organising capacities.24 On the other hand, I find some of her finer points more problematic – that “corporatism” and “neoliberalism” are “coterminal” and “internally related,” and that the Accord deepened both.25 While there is a processual “line of sight” between (some versions of) corporatism and neoliberalism, the question arises: why would the left of the labour movement enter into, and remain in, the Accord if it was so likely to end in tears? These three concepts – neoliberalism, corporatism, the Accord – need comprehensive, subtle and nuanced analysis. Here I put forward some ideas that both complement and occasionally challenge Humphrys’ analysis. Both, hopefully, will enrich discussion of the Accord as an issue for Labour History.
“Neo-liberalism” differs from classical liberalism in the way it foreshadows the new era of financialisation and globally mobile capital. It is associated with a shift from national development to global integration, which did take place during the Accord period. The term first arose as a conceptual counterpoint to the rise of social democracy in Germany and Austria.26 The architects of the Bretton Woods post-war economic order feared that “enclosed” national capitalism(s) would quite likely usher in some version of socialism, so they laid the foundations for globalisation and economic openness.27 Polanyi’s influential 1944 book, The Great Transformation, argued that tensions between “social protection” and “economic liberalism” drove politics. He suggested that the economy is embedded in social relations. However, more recently, Foster suggests that neoliberalism’s goal is to “embed the state in capitalist market relations” in order to promote capitalist reproduction and create “absolute capitalism.”28
In Australia, through the 1990s, the popular term was “economic rationalism.”29 This term claimed that markets were the most efficient way to organise the achievement of economic as well as social goals – as in Thatcher’s “TINA” (there is no alternative). Disbelievers coined the catchy comeback “economic rationalism is irrational.” This view drew on international research showing that economically successful countries were characterised by strong state leadership (Japan) and/or “corporatist” arrangements of various sorts – i.e. non- or even anti-market structures.30
Mistakenly, such researchers (including me) thought this could potentially shift economic rationalist policy, which (one might be forgiven for thinking) sought the most efficient way to achieve economic and social ends. In the Ted Wheelwright Memorial Lecture, Susan George criticised the Left’s attempts to counter neoliberalism with evidence-based argument about policy alternatives; to her mind, one characteristic of neoliberalism is that proponents are not swayed by evidence.31 They seek domination, not efficiency, through the implementation of market-like institutional forms, no matter the implications for “efficiency.” Cahill and Toner illustrate how marketisation has been disastrous: from prisons, to childcare, to aged care, to training.32 Yet policy makers persist in aping market processes, despite demonstrable flaws and the bite of evidence-based criticism.
For Humphrys, neoliberalism is not mere deregulation; indeed, she prefers such terms as “neo-liberal re-regulation.”33 She suggests that changes in the neoliberal era are best understood as a “re-regulation of economic frameworks and social relationships on new lines.”34 I agree, but, with John Braithwaite,35 I wonder about “neoliberalism” as denoting capitalist societies. Braithwaite opts to explore the forms taken by “regulatory capitalism.” Except for the global ones, these regulatory forms are nested within (the remnants of) particular national capitalisms, explored in a new research programme that maps the “varieties of liberalization.”36 Humphrys also points to the importance of comparative research in understanding the development of “actually existing” neoliberalisms.37 Unfortunately, the book contains too little comparative research to contextualise adequately the Accord, especially when comparative arguments were a crucial part of its rationale. There are references to the UK, USA and NZ – all Anglophone countries – and two pages devoted to Finland, but Sweden, which was an exemplar for the Accord, is conspicuously absent. In terms of, Humphrys acknowledges that the view that it could be a “pathway to socialism” influenced powerful union leaders, such as Laurie Carmichael and John Halfpenny, as well as a layer of union officials and academics.38 The prospect of moving Australian capitalism in a socialist direction led the Left into the Accord.39
After World War I, socialist intellectuals debated the labour movement’s role within a democratic transition to socialism. One view was that “corporatism” was a dead end for socialist transformation. This view – subsequently known as the “reformist limitations” thesis – argued that labour movements’ involvement in capitalist economies, through incomes policies and trade-offs with the state, would result in union incorporation and disorganisation.40 An opposing view posited that unions could “mature” and that industrial and political action could lead to socialist advance. The transition to socialism would not be like walking from a dark room into the sunlight, but would occur progressively, through the “democratic class struggle” and the construction of what the Swedish Social Democrat treasurer and intellectual Ernst Wigforrs called “provisional utopias” – milestones in the class war.41
Many Marxist theories of the state portray the latter as a “state in capitalist society” or as “the instrument of the bourgeoisie” – thus conceptually foreclosing transitional possibilities. A more nuanced view (possibly also Marxist) sees the state as subject to contestation by forces in the polity where interests (such as unions and employers) contest and seek to shape the workings of state institutions.42 For labour reformist theory, the state is an “arena of class forces” – once “captured,” state institutions might shape events in the polity and influence other institutions – a process that has been called “reverse instrumentalism.”43
Labour reformism was thus seen as an alternative to corporatist incorporation. The term “corporatism”44 has a wide range of uses, most of them innocent of any view about socialism. It is possible to distinguish several broad meanings.45 “Authoritarian corporatism” – in which authoritarian governments directly “incorporate” national trade union movements into the state (for example, Singapore) is of a kind with fascism. Second, “weak” corporatism, or “corporatism without labour,” refers to countries like Japan, in which organised business interests have close contact with the state, while excluding organised labour from political influence – as characterised in Pempel and Tsunekawa’s seminal article.46 Third, “strong” or “democratic” corporatism (Katzenstein’s main interest) includes “voluntary, cooperative regulation of conflicts over economic and social issues through highly structured and interpenetrating political relationships between business, trade unions and the state, augmented by political parties.”47
As a variant of “democratic corporatism,” the Swedish Model was attractive to Australian reformers, including some bureaucrats, even ministers, who were not yet in thrall to economic rationalism – before the latter became an essential public service career qualification.48 The Swedish approach to industry development sought to adjust to international markets by closing down uncompetitive industries and replacing them with growth ones. In this process, it would protect the “heroes of industrial adjustment” – displaced workers – with various forms of supportive allowances, including income support, retraining and relocation – a policy approach Castles, following Katzenstein, characterised as “domestic compensation.”49 Sweden has also scored well on many comparative social indicators, like education, healthcare and childcare, as well as gender equality.
Until the 1970s, Swedish unions and business engaged in “joint regulation” of the labour market, with the state effectively excluded, and the unions enforcing their own “solidaristic wages policy.” This boosted wages at the bottom of the labour market, thus accelerating structural change by driving inefficient industries out of business, which helped to overcome wages dispersion and inequality for reasons of class solidarity.50 The state provided support for workplace participation and industrial democracy, as well as funding for worker-oriented research into these factors and what we would today call “job quality.”51 Segments of the labour movement also proposed economic democracy via “wage earner funds,” designed to counteract a problem with the solidaristic wages policy – that wage restraint at the upper reaches of the labour market left “super profits” unclaimed, straining union movement cohesion. The proposed solution was for employers to pay this money into wage earner funds controlled by the unions, who (according to one version) then used it to purchase a controlling interest in “their” firms.52 Although these aims were never fully implemented, the idea of collective capital formation and labour ownership remained influential, including in Australia Reconstructed.53 If there was any “socialist” rationale for wage restraint, this was it.
Turning now to Australia, the Left of the union movement argued that state intervention in industry policy would lead to more efficient, as well as fairer, outcomes than “economic rationalism,” while increasing their influence on the state. Unions would participate in key industry policy- making institutions, such as the proposed Economic Planning and Advisory Council (EPAC), and the Australian Manufacturing Council (AMC), thus playing a role in the economic planning envisaged in the Accord (see below).54 Quite apart from socialist transition, “corporatist” arrangements in Sweden, as well as other Nordic countries, were demonstrably associated with beneficial effects. Calmforss and Driffel also argued that centralised industrial relations arrangements were associated with better economic and employment performance.55
This sort of research reached its high point in the concept of “Varieties of Capitalism”56 and lent itself to the proposition that “coordinated” economies produced better economic and social results. This was, however, challenged by the improved performance of the “liberal” economies (particularly regarding unemployment) as the “flexibility” agenda began to bite. A new “convergence” thesis emerged – all economies would “converge” on the “neoliberal” model. A particularly persuasive version is Wolfgang Streeck’s How Will Capitalism End?57 Streeck argues the future will likely see a new “desocialised” capitalism and the decline of Polanyian “social protection.” This need not be a “free market” but could just as easily be crony or gangster capitalism. Against this bleak future, Kathleen Thelen proposed a new research programme around the concept of “varieties of liberalisation” to examine how “neoliberalisation” has taken place against pre-existing “historic compromises,” leading to different paths, but perhaps at least partially “taming” excesses of neoliberalism.58 What is missing from Thelen’s analysis, as is typical of the “big guns” of comparative political sociology, is any discussion of Australia.
Humphrys suggests “there is a lack of critical assessment of the Accord in the scholarly literature.”59 I would have liked her to engage with more of the critical literature that does exist – in particular Politics and the Accord.60 This book criticised the Accord from within its engine room. The authors (except Rix and Hampson) worked in the AMWU through the late 1980s and early 1990s. Their criticisms appeared in The Australian, prompting an aggressive response from then AMWU secretary and senator-in-waiting, George Campbell.61 Politics and the Accord situated Australian capitalism within comparative political sociology, in particular the work of Castles.62 Castles argued that Australia was “between historic compromises” but the form of the new had not yet emerged from a contest between the emerging “neoliberal” model and a more coordinated model, informed by social democracy. Castles coined the term “domestic defence” to register the nature of Australia’s political economic arrangements, which were underpinned by imperial markets for primary products, initially rural, then mining. Manufacturing was protected from foreign competition, provided that employers paid wages determined via the arbitration system (an arrangement known as “new protection”). The White Australia policy completed the defensive Australian “historic compromise.”
Politics and the Accord considered “labourism” to be a defining feature of this policy complex. Labourism, as a union strategy, confined its concerns to the wages and conditions of the working man, and not with broader issues of economic management, or with the “bosses’ problems.” Theories of union maturation, however, considered this to be but a stage in the development of union movements, which would evolve naturally from a focus at the workplace to a concern with broader issues of economic and social development, which they would develop the research capacity to analyse, and the political capacity to prosecute.63 Through the 1970s and into the early 1980s, the Left of the union movement had followed “wages militancy” as its strategy. By the early part of the 1980s, however, the Left (partly influenced by conceptions of Swedish union development) had been exploring what might be achieved through incomes policies and “social contract” politics.
By the end of the 1970s, the Australian “social settlement” was looking ragged on several fronts. In terms of agriculture, the UK had joined the European Economic Community, a condition of which was purchasing agricultural products from within the common market. On the industrial front, wages militancy had caused disruption and made wage gains, but at some cost in terms of economic stability as the 1970s came to an end. The Accord was an attempt to devise a new strategy, which (from the Left’s perspective) would restrain wages and militancy as part of a plan to achieve institutional changes that advantaged organised labour and the working class. Central to these was erosion of the power of capital over investment – union influence on industry policy was the key. That is why, in the negotiations and drafting of the Accord, the Left insisted on key passages:
the paramount objective of economic policy is the attainment of full employment. Industry development policy should be integrated with macro economic policy to achieve this goal … fundamental to the interventionist policies required is a planning mechanism. This process will embrace consultative mechanisms of a widespread nature which will play a co-ordinated and ongoing role in assisting the success of the transition of the economy onto a planned framework.64
That the Left was pinning a lot on the Accord was signalled in 1984 when, at a special congress in Sydney on 3–4 November 1984, the Communist Party of Australia endorsed the formation of a new “reformed” socialist party, one aim of which was to marginalise far-left opponents of the Accord from the mainstream Left and to lock the latter into support for the Hawke government.65 Yet in the same year, a major policy development initiative by the Metal Trades Unions indicated dissatisfaction with the Accord’s progress on the industry policy front.66 Progress on the new institutions – EPAC and the AMC – was unsatisfactory. The government’s commitment to the heavy industry plan outlined in the MTU document was half-hearted. At this point, it was clear that the Left’s industry policy agenda was not going to eventuate. This was the time to use what militant capacity was available to push this transformative agenda and to withdraw from the Accord.
How good is hindsight! Instead, the union movement fell prey to a strategic dilemma. On the one hand, staying in the Accord risked eroding the movement’s trust in its leadership, since workers were being asked for wage restraint in return for gains that were nebulous, hard to sell, or non-existent. On the other, breaking out of the Accord risked the wrath of the government, and/or the ALP losing power – and an anti-union crusade by the Liberal–National Party government and the New Right. The dilemma highlighted factional divisions, since on the right of the union movement, many never supported the industry policy agenda. Thus, the union movement was insufficiently united to pursue it. Union leaders’ militancy was also limited, if (as was often the case) they had their eyes on careers within the government or the ALP.67
With lack of government support for the unions’ preferred version of industry policy apparent, many of its supporters began to shift their allegiance – particularly those with jobs in government where adherence to “economic rationalism” was becoming an essential career attribute.68 As it happened, for leading Accordists the socialist goal was itself becoming seen as unachievable “in any real time frame,”69 just as the collapse of “actually existing” socialism was already well under way. What was needed was a new doctrine that would make it seem as if Accord processes were still worthwhile. Enter Australia Reconstructed and the “post-Fordist” workplace change industry.
This is a vital part of the Accord processes that I put forward here to supplement Humphrys’ account. Humphrys mentions the “structural efficiency principle” (SEP) that made wage rises conditional on workplace changes, conceived as “productivity trade-offs” – removing such “productivity impediments” as allowances and demarcations. This then shifted to full-blown work reorganisation and “award restructuring,” raising issues of training and upskilling, as well as models of work organisation. I address these issues in turn.
First, the AMWU Accordists had great expectations of training reform (with hindsight, some of them were naïve or ill-informed) including objective methods of skill recognition via competence-based training, and a qualifications structure that supported career paths spanning industries. This was nothing less than a national training system, with cross-state qualification recognition, based loosely on understandings of the German training system. Underpinning the proposed Metal Industry Award, it was considered crucial to the industrial strength of organised labour, as well as the fortunes of individual workers.70 Against it, business and “economic rationalists” sought to limit skill recognition and qualification transferability to “the needs of the enterprise” while developing a “training market” that eventually marginalised technical and further education (TAFE) in favour of private training providers. This lowered the quality of qualifications and, by 2000, it was already clear that the system would not work.71 It also meshed well with the emerging enterprise bargaining agenda in Accord Mk 6. Later, Keating’s new Industrial Relations Reform Act 1993 opened up the possibility of “enterprise flexibility agreements” – non-union enterprise bargaining (individual contracts would have to await the new Liberal–National Party government in 1996).
Second, what images of work organisation would guide workplace restructuring? Some labour-oriented workplace change advocates were attracted to the Swedish experiments, which had a presence in international debates.72 On the other hand, in 1990, the world of work was heavily influenced by the MIT International Motor Vehicle Program’s The Machine that Changed the World.73 This best-selling book argued that what they called “lean production” – based on Japan’s Toyota production system – was the inevitable future of work. This was essentially propaganda, as a thriving research industry made clear that conditions under this system fell far short of the idealised image, especially in the transplants.74 In 1991, the nature of lean production became an issue in Australia when Toyota proposed to build a new car assembly plant in Altona, and made it a condition of its investment that the Vehicle Builders’ Union accept (a version of) the lean production system.75
This account of the Accord is not complete without a mention of post-Fordism – the influential theory that the world of work was moving beyond mass production and into an era characterised by forms of work that would demand of workers greater skill and involvement – and that this would be good for them.76 In my own work on post-Fordism and the Accord,77 I tried to explain its popularity by pointing to the political role the doctrine was playing in then current controversies,78 since its popularity was not explained by its correspondence to the real world. First, as a “transition theory,” it had an “elective affinity” with broader changes then taking place – in particular the collapse of socialism in eastern Europe, and the fall of the wall dividing East from West Germany. Post-Fordism could, with a slight tweak of the mind, replace socialism as the end point of some underlying and inevitable transition. Second, post-Fordism blurred important distinctions between the forms of work organisation and training described above. It plausibly described lean production as post-Fordist, and did not distinguish between firm specific and nationally transferable training. Third, post-Fordism said nothing about industry policy or the state’s role in industry development, much less the possibility of unions’ involvement in them. It therefore did not challenge economic rationalist hegemony, but fitted rather well within it. I argued that, taken together, these misapprehensions helped justify union activists staying with the Accord. Laurie Carmichael is perhaps the best example of this shift, which also took place among a layer of union officials and public sector employees, who morphed from socialist activists to workplace change consultants in the blink of an eye.
Australia Reconstructed helped in this transition. The document was written under the leadership of Ted Wiltshire within the bureaucracy of a small haven for labour apparatchiks known as the Trade Development Council (TDC). It was sanitised for public consumption before release. The resulting contradictory document was both a high point of union policy development in Australia and testimony to the maturation process going on in the Left. At the same time, it straddled the contradictions mentioned above, neglecting to criticise the ALP’s lack of enthusiasm for industry policy, while setting out images of work organisation and labour market adjustment that had Swedish as well as Japanese resonance. However, in the reforms that followed, anything radical was quietly jettisoned, as Australia proceeded down the path of enterprise bargaining, and the implementation of lean human resource management at the workplace.
As a topic in Australian labour history, in conclusion, the Accord case can be read as another instance of the “corporatist” and “reformist limitations” thesis, but I would argue this does not do it justice. It could also be read as a cautionary tale of overextending the “union maturation” and “labour reformist” thesis, because of the labourist and factionalised nature of the Australian union movement. The Left of the movement displayed “mature” policy development, but could not carry the rest of the movement with it. It was difficult to sell the message that wage restraint was necessary to assemble an investment war chest for collective guidance through industry policy – which underpinned the Left’s support for the Accord. When the agreement failed to deliver this, strategic dilemmas were posed for the movement as a whole, and the Left in particular. The movement opted to stay with the Accord, despite it failing to deliver to its members – at least in terms of organisational capacity. Exactly how this occurred, in terms of how the ACTU controlled its constituents, is a story I believe that is yet to be told (although some pointers are to be found in Edwards’ biography of Keating).79 It is a good topic for labour history that bears on the carnage that surrounds us today.
Discussant 3: Lee Rhiannon, Member NSW Legislative Council and Senator, 1999–2018
The Prices and Incomes Accord of the 1980s and early 1990s, struck between the Bob Hawke and Paul Keating Labor governments and the ACTU, has had a major impact on Australian political life. The events of that time exposed the tension between those who believe progressive change is achieved by people’s collective action and those who put their faith in the upper echelons of governments and unions to deliver the reforms they deem people need. This review explores the role of the Accord in changing how unions engage with social movements; the challenge for the Left in working with social democratic parties; historic examples of social contracts; and the importance of an independent union movement.
Thanks to Elizabeth Humphrys, many of these issues are explored in her book How Labour Built Neoliberalism: Australia’s Accord, the Labour Movement and the Neoliberal Project. The recent global climate strike received strong backing from the international union movement. Sharan Burrow, general secretary of the International Trade Union Confederation, said: “The solidarity of the trade union movement globally is behind you. The ITUC, with over 200,000,000 members around the world, is totally in support of your leadership.”80 In some countries workers took strike action. In Australia, however, only two workplaces are known to have voted to strike in support of the young climate activists. The good news is that many union representatives and union members participated in climate strike rallies held across Australia. But the fact that so few workers took industrial action to attend the rallies is disappointing for a country that once played a leading role in organising political strikes.
Nelson Mandela recognised the role of unions in Australian politics when he visited Australia in October 1990, just five months after being released from his 27-year jail sentence for fighting apartheid. Mandela paid tribute to Australian trade unions for the global leadership they provided to the international anti-apartheid movement by promoting sanctions and boycotts of South Africa. This style of campaigning involving political industrial action that helps build social movements has reduced markedly since the Accord. History demonstrates that unions play a key role in driving progressive change when they work with social movements. The foundation and strength of unions has been derived from collective action. To deliver lasting reforms that will improve people’s lives and protect the environment, people must be involved in making decisions about their collective future and taking action. Excluding people from the process of change, even when achieved reforms are beneficial, is not the best way to strengthen the social movements we need for society to progress.
While the Accord delivered some benefits for working people, in terms of building union action as a core part of social movements committed to a more equal and more democratic society, the evidence suggests the agreement between the ACTU and the Labor government was a setback for workers and their families. The Accord process, which was based on restricting workers’ wage rises, required union leaders to limit workplace militancy. These restrictions put in place in the 1980s have been developed and refined by neoliberals who know that limiting the ability of unions to take political industrial action will consolidate the power of capital, boost company profits and greatly limit the ability of people to organise and agitate for the greater good. Australia was once internationally famous for the level of political campaigning and strike action in which our unions engaged. Social movements such as Women’s Liberation, the Green Bans campaign for the protection of urban environments, opposing the Vietnam War, and many more, all had an active and often militant union component to them. By comparison the positive story to be told and celebrated about the role of unions in social movements in the post-Accord years is very limited. While unions are active in a number of key campaigns – the climate strike and marriage equality campaigns being two recent examples – political industrial action is rare these days.
I am not trying to say that the Accord is entirely to blame, but the loss of on-the-job union activism when the Labor government–ACTU social contract was in place had massive ramifications. We effectively lost a generation – and probably more than one – of young worker activists, who previously learnt from on-the-job organising and actions. That culture of political activity in unions was weakened. Anthony Forsyth, Professor of Workplace Law, and Carolyn Holbrook, a Deakin University research fellow, wrote: “Within the union movement itself, the Accord was always contro- versial. Critics argued it transferred power from the grassroots network of delegates and shop stewards to an elite group of senior officials sitting around the table with business and government.”81 The Accord was used to lock out union militancy. It was a time when workplace issues were largely dealt with behind closed doors.
A hallmark of neoliberalism around the world is that industrial struggle is curtailed through legal means and increasingly outright violent suppression. In Australia trade practices law is used to police union activities. The usual drivers of this are corporate interests and governments. What we saw in Australia in the 1980s and 1990s was some union officials take on a policing role of unions when required to by the terms of the Accord. A foundation of the Accord was that once the agreement on wages and a social contract were entered into, there could be no other wage claim made and no claims for significant improvement in conditions. This was known as the “no extra claim provision.”
Recent comments by a few of the union officials who backed the Accord are informative. Tom McDonald, former national secretary of the Building Workers Industrial Union, described the problem this provision caused:
[M]ore than anything else [this] aroused opposition from union members and workers. The problem union leaders faced was the task of policing the agreement and disciplining their members whenever they sought additional wages increases or improvements in conditions of employment that represented a breach of the no extra claims undertaking.82
If unions failed to honour this undertaking, the wage increases could be removed from the award. On the 35th anniversary of the signing of the first Accord, the ABC reported that both Bill Kelty and Greg Combet commented on the long-term implications this social contract had for the movement. Combet said that one of the consequences of restructuring the economy during the Accord period was “the decline in the level of union membership in the Australian workforce and that has weakened the influence of trade unions.” Kelty said the Accord “wasn’t without its pain and cost to the union movement.”83
Not all unions followed and policed the dictates of the Accord. Unions that covered meat workers, builders labourers and pilots campaigned in defiance of the Accord’s restrictions, but the forces of neoliberalism prevailed as the ability of the union movement to engage in radical political action was largely curtailed through the Accord agreement and by legislation. Some unions suffered serious penalties, often involving massive fines.
It should be acknowledged that many of the architects of the Accord developed this social contract with the sincere belief that workers would benefit from a social wage that improved Australians’ quality of life and working conditions. The Accord’s social wage elements included improved public health, pensions and unemployment benefits, as well as tax cuts, and superannuation. This approach, however, negates an understanding of the class forces that determine social development. Winning better on-the-job conditions and lifting living standards is vital, but at all stages of struggle it is essential that people’s collective participation is part of the process. Without this experience and culture, the clock can be more easily turned back on progressive wins.
Today more communities are alert to the need for system change. It was significant that at the global climate strike many of the placards identified Western leaders and the capitalist system as the culprits. Calls to change societies that foster inequality, oppression and exploitation, are growing stronger. Relying on adjustments within the existing system, as delivered by social contracts containing constraints, like restrictions on the right to strike for example, are being increasingly recognised as problematic. There is a greater awareness that the neoliberal and capitalist endeavour to allow the global marketplace to dictate how people’s lives and work are organised has failed. Discussion on how to effect change is broadening out and increasingly democratic socialist groups are talking about practical steps from advocating for a green new deal to working for a democratic socialist society that curtails corporate interests. The experience with Corbyn forces in the British Labour Party and with Bernie Sanders, Alexandria Ocasio- Cortez and other like-minded US politicians is heartening. But to give strength to similar advocacy and organising in Australia we need the strongest people’s movements for change, and that means unions playing a leading role.
A difficult aspect in building social movements, however, has been the role of social democratic parties when they are in government. Capitalism, and its negative impact on so many people, is rarely challenged and corporations benefit. Weighted social contracts have come to epitomise this style of governing. The British social contracts under the Wilson and Callaghan Labour governments of the 1970s penalised workers while benefiting business interests. British Labour had been elected to govern on a promise to deliver a social contract that would redistribute income and wealth. However, once in office, Labour quickly moved to sideline these commitments and instead cut public expenditure and enforce limits on wage growth. A decade later history repeated itself when the ALP was in government. As treasurer and a strong advocate for the Accord, Paul Keating’s vision for a stable Australian (capitalist) economy was based on low wage growth. Nearly 40 years later it sounds absurd that a Labor government would push for wage restraint as a precondition for delivery of Medicare, increased investment in education and other reforms to which working people are surely entitled. A Labor government should have delivered these reforms without robbing workers of their income. But that was the trade-off the Accord implemented. When in office, Labor has handed over billions of dollars to car and steel manufacturing industries. The promises and commitments to working people in these industries were not honoured. The usual outcome was massive job losses and industry closures or contraction. The much-touted benefits for the economy and workers barely materialised.
This is not just a recent phenomenon. Another massive failure of Labor in office was the 1949 coal strike. While there was no formal social contract involved, for the coal miners and their union there was a clear understanding that wage increases and improved working conditions would be granted after World War II. The workers’ demands had been put on hold for the duration of the war. In his History of the Miners Federation of Australia, Edgar Ross wrote: “The Second World War ended with the coal industry and the mine workers exhausted. In its technical backwardness the industry had been strained to the limit and the mineworkers forced to keep in ‘cold storage’ long overdue claims while working under conditions of great fatigue to boost production.”84 The mine workers’ production during the war reached a record 15 million tons per annum in 1942 and the union provided plenty of notice of their claim for the overdue demands to the federal and state governments and coal owners once the war was over. Despite this, the Labor government ignored their demands; instead, Prime Minister Ben Chifley told caucus, “The Reds have to be taught a lesson.” The Chifley government spent thousands of dollars in a massive leaflet drop in the northern coalfields and large advertisements in the major newspapers.
They were signed by the Prime Minister who proclaimed that the strike was a communist attempt to subvert the Australian way of life.
In June 1949, mine workers voted 7,995 to 822 to take strike action. The next day the Labor government gave notice of the National Coal Emergency Bill that provided for jailing of union officials who provided financial assistance to the strike. With the support of the Menzies opposition the Bill became an Act in record time. Leaders of the miners, wharfies and ironworkers’ unions were jailed and fined. Some were sentenced to 12 months in jail. Labor then brought the army into the northern and western New South Wales coalfields to do the work of the coalminers. This meant Chifley ignored the Labor Party platform, which clearly stated, “No troops to be used in industrial disputes.” This was one of the ugliest Cold War disputes in Australia with Labor and Liberal politicians promoting the “communist conspiracy” theory to discredit the miners’ claims and tactics. The federal election, held on Saturday 10 December 1949, resulted in a landslide victory for the Liberals. It would be 23 years before Labor would return to office. In this dispute, despite a few exceptions, the ALP leaders served the interests of companies associated with mining and capital overall. The result was that, only a few years after the defeat of fascism, Robert Menzies, an admirer of fascism, was elected Prime Minister – a position he would hold until he retired in 1966.
This brings us to the question: How do we build and maintain independent unions and why is this so important for social movements? This was certainly the intent of the workers who formed the first trade unions, as referenced by Professor Brentano in his 1870 study on the “Origins of Trade Unions,” where he notes that unions arose so “that they might maintain independence.”85 How do we ensure that on-the-job struggle is the foundation of union activity and not usurped to further the interests of social democrat parties and by those who want to limit union work to behind-the-scenes negotiations with bosses? In Australia, many mass union activities are subordinated to the Labor Party’s electoral prospects. This is not surprising as unions formed the Labor Party in the late 1800s because of the exploitation and abuse to which workers were exposed at the hands of companies and conservative parties. The logical outcome was to ensure working people had representatives in parliament who would serve their interests and that is usually equated with electing a Labor government.
But, 100 years later, a lot needs to change. History has taught us time and time again that electing a social democratic government and then waiting for them to deliver on their promises is a recipe for frustration and often failure. Two recent federal election campaigns illustrate this.
The tactics and strategy involved in the Your Rights at Work campaign, the 2007 union campaign to get rid of the Howard government’s WorkChoices, brought a sophisticated level of campaigning to Australian shores. But as the campaign unfolded it became obvious to many participants that the whole Your Rights at Work campaign was geared to an election outcome. Certainly, removing the Howard government was essential and needed to be a priority for the movement at that time. Labor when in government, however, did not fully dismantle WorkChoices and many unionists were disappointed. Empowering social movements outside of the election cycle always needs to be a core aspect of progressive political work. In the 2007 Your Rights at Work campaign and in the 2016 Change the Rules initiative of the ACTU the majority of campaign groups made up of hard-working unionists and community support activists were actively dissolved or withered away.
The examples in this essay of Labor’s problematic activities, particularly when they are in government, are set out not to suggest that the Liberals and Nationals would be preferable. Critique of social democrats is necessary, as one of the major challenges for the Left since the formation of the Labor Party over 100 years ago has been overcoming the limits this social democratic party has put on social movements, and how it also undermines the independence of unions. In Australia the history of social democracy is one dominated by parliamentary tactics and outcomes. Few Labor MPs promote ongoing campaign plans designed to build independent political movements. However, British Labour in recent years appears to be breaking this mould with Corbyn forces assisting and respecting progressive social movements. In Australia the challenge of working with Labor remains huge but, of course, still preferable to having the Liberals and Nationals in office.
Although the re-election of the Morrison government was a setback for the country, for those of us committed to building social movements a top priority remains changing the oppressive laws under which unions are forced to operate. When we talk about the right to strike, we need to ensure the legislation covers not just industrial action but also political strikes. Throughout the green ban era with the Builders Labourers Federation and the fantastic work of Australian wharfies and seamen, whose actions contributed to the worldwide boycott and sanctions movement that proved critical to the defeat of the racist South African government, there were no fines or imprisonment of union members or officials. They were tough struggles but at least strike actions for political campaigns could occur. Under international law, the right to strike is codified as a human right. The right to withdraw one’s labour is fundamental to the common good. For decades, the International Labor Organisation has informed Labor and Coalition governments that their failure to include the right to strike in industrial relations laws puts Australia in breach of international conventions.86 Unions and workers in the USA have more rights compared with those in Australia.
Let us remember why we put emphasis on building social movements. Workers exercising collective action by going on strike is a key component of social action and transformative change. Such actions have brought great benefit to Australian workers, their families and wider communities, won environmental protections, and contributed to international solidarity wins. It was the strength of people’s actions backed up by political industrial action that was the key to these wins. Where legislation was needed to enshrine progressive change, MPs acted in response to public pressure. They were not the initiators of change.
For some readers it may appear that my argument emphasising the important role unions play in building social movements is a lost cause. Elizabeth Humphrys may also hold that view as her book establishes how Australia’s Accord was a neoliberal project put in place not only by a Labor government but also by a number of unions and their peak body, the ACTU. Many do argue that with membership in most unions declining, and with tough legal restrictions on strike action, the era of political industrial activities boosting social movements is a historic memory.
Unions remain, however, the largest collective organised force committed to progressive change. While there will always be arguments over industrial tactics, the increasing exposure of the crisis caused by corporations and how society is structured is raising awareness and fostering political actions. These objective conditions are putting pressure on the union movement as a whole to be more independent and to be more involved in building social movements. And hopefully the union movement is recognising that social accords that place restrictions on the right of unions and workers to take strike action should be resisted.
Discussant 4: Tim Lyons, Assistant Secretary, ACTU, 2008–15
I write this not as an academic, but as a practitioner, a union member and an organiser. I have a union background – during the Accord period, I worked as an official with the National Union of Workers (the now United Workers Union but back then the Federated Storemen and Packers Union). These unions were synonymous with the Accords via such figures as Bill Kelty and Simon Crean. For those who promoted the Accords, Humphrys’ book is a punch in the guts. It is a punch that lands and hurts. And a punch that has been a long time coming.
I agree with the book’s core contention: Australia’s unions made a deliberate decision (although the far-reaching consequences were obscured at the time) to support the suppression of wages and industrial militancy. Indirectly, but importantly, these decisions reduced avenues for rank-and- file activism. We should not have. It was a mistake. Not all the specifics were mistaken but, in aggregate in my opinion, that must be the judgement. The Accords were a series of decisions that seemed incredibly smart, and probably necessary (or at least unavoidable), at the time, but they have aged in a lot of respects very, very badly.
From the outset, Humphrys’ book makes the point that open debate about the Accord and its consequences remains rare in the union movement. That is both undoubtedly true and absolutely wrong. There must be a reckoning with the Accord decisions or unions will not make good choices about what is to be done next, and what should be their “policy ask” on a future federal Labor government. There must be a reckoning with what the ALP, the ACTU, and individual union leaders did to dismantle the structural power of unions over the course of 13 years. Looking back years later, as Humphrys notes, Keating claimed to have pulled the “rotten teeth” of the ACTU.87
The book successfully debunks the intoxicating view (widely held at the time in the labour movement and one which is far from extinct) that in the Accord/Hawke–Keating period we had found the secret to adapting post-war social democracy for the modern age. Did we, or didn’t we? Ironically, it is more common within the labour movement to defend the Hawke–Keating period now than it was in the immediate aftermath of John Howard’s 1996 defeat of the second Keating government. Certainly, some of the commentary is ahistorical, particularly the widespread fallacy perpetuated, even by some union leaders, that the employers were party to the Accords. Whatever is the answer to that question, a present-day union leader who does not read Humphrys’ book, ponder it carefully, and debate it with colleagues is, in my view, not doing the job required of them.
My reactions to the book were in almost equal parts emotional, practical and intellectual, because I am a political and personal product of the Accords and I have spent my working life wrestling with their consequences as an organiser, industrial officer, policy specialist and ACTU leader. While not a full-time union official anymore, I still work with unions in both the public and private sectors. The book’s effect on me was fundamentally rooted in knowing that in all probability I would have made roughly the same decisions in roughly the same sequence if I had been there and had my hands on the levers at the time. Guilt, if you like, by association.
How Labor Built Neoliberalism is, in an important way, the theoretical and macro-historical companion volume to the book by my Per Capita colleague, Dr Dennis Glover, entitled An Economy is not a Society, which documents the Accord-era destruction of the community of Doveton in suburban Melbourne where he grew up.88 There are brutal but inescapable truths in these two books for the labour movement.
First, they document (in different ways) how many of the working-class communities and the union institutions that were an essential part of their social fabric, ended up as something akin to desiccated husks, blowing along in the political and economic wind and, in some senses, growing less functional by the day. Emblematic of this decline, perhaps, are the northern Adelaide suburb of Elizabeth and the AMWU. Early in her reign, Queen Elizabeth II visited Elizabeth and opened a car factory, set amid neat and affordable working-class homes. When her grandson visited last decade, he visited a drop-in centre for the long-term unemployed. The Australian car industry is no more. Humphrys appropriately focuses significant attention on the AMWU in her book. A traditionally militant and communist-influenced union, the AMWU was one of Australia’s largest and most powerful. It was the custodian of the award rate for a fitter and turner in the metal trades, the job classification around which the entire Australian system of centralised wage fixing revolved. This union also produced intellectual and industrial leaders who profoundly influenced the labour movement. Today, in many industries, modern award rates are largely irrelevant and, where they are relevant, are largely ignored via wage theft. Today, the AMWU is not among the largest of Australia’s unions and, while it still has fine officials and activists doggedly pursing the interests of manufacturing workers, it no longer plays the leadership role it once had in the union movement as a whole.
Second, the books make a persuasive case that we (that is, the entire labour movement) vastly underestimated the extent to which unions were fundamentally unprepared, not just for the changes required by the Accords, but for the changes that came from related policies and the behavioural changes by capital that became inevitable as a result. These changes include the resources and skills needed to implement enterprise bargaining successfully and the increasing anti-union turn of business. The import and future impact of decisions made in the Accord period were often not understood, or were underestimated, even by the most senior participants. The labour movement changed our society, with mostly good intentions, but in a way that had profound and deleterious effects on our own movement’s institutional power.
The essential question posed by Humphrys’ book is where did the Accords end? The answer I give as a unionist and activist is nowhere particularly good. In retrospect, it is arguable that, unintentionally (Keating and perhaps some others are exceptions to this) but nevertheless inexorably, the Accords ended in WorkChoices and subsequently in the milquetoast sensible centrism of the Fair Work Act 2009. Labour market deregulation developed a political momentum from its own internal logic that was unstoppable.
What started as macroeconomically justifiable, and maybe even necessary, collective wage restraint in return for a social wage dividend ended in bargaining atomised to the individual level, social wage improvements be damned. In the last year of WorkChoices, around 1,000 workers per day were being put on statutory individual contracts, usually as a take-it-or-leave-it offer as a condition of employment. Around 70 per cent of these individual contracts removed shift loadings and annual leave loading, 65 per cent removed penalty rates, half removed public and overtime pay, and nearly a third removed rest breaks.
And where are we now under the Fair Work system? Wage theft is endemic. Wage growth has been at record lows for years on end. Militancy is close to extinct; a worker is more than 15 times more likely to get injured at work than to go on strike. Most unions are weak. Industrial disputes are at record lows – lower even than under most of the WorkChoices period.
But some context is required. As the book documents with diligence and precision, the Accords did not emerge to destroy some prelapsarian working-class idyll. People, I think, often do not know or forget about how bad things were: the incoming Hawke government faced an environment of low growth, low investment, low profit, falling real wages, high inflation, high interest rates, high unemployment, and high tariffs. The oil shocks of the late 1970s, while very important, were the least of Australia’s problems. In 1981, business overdraft interest rates rose to over 30 per cent with John Howard as Treasurer. Both inflation and unemployment were in double digits. Meanwhile, GDP grew at under 1.5 per cent per annum. Union leaders became tired of chasing wage growth against surging inflation and barely, or sometimes not even, keeping up.
On the other hand, criminal tax avoidance for the wealthy was a major industry abetted, ironically, by a trade union, the Federated Ship Painters and Dockers Union, who lent members’ names to directorships for “bottom of the harbour” schemes. Only three in ten children finished high school. The Fraser government had repealed Whitlam’s proto-Medicare and only 20 per cent of private sector workers had any superannuation. Singaporean Prime Minister Lee Kuan Yu’s 1980 line that we were becoming the “white trash of Asia” was frankly pretty accurate. Australia had an artificially high currency pegged to the Trade Weighted Index, and a protected semi-autarkic domestic manufacturing sector that sat alongside commodity exports and capital importation.
It was into this world that the Hawke government and the Accords were born – an environment of economic crisis and the very recent memory of the Whitlam experiment. Context matters. Change was coming: the world was leaving Australia’s old order behind it. Decisions were needed for change from which real people would benefit. The question was if a fairer and stronger society would be built and would a broader social dividend be paid on these disruptive and destructive “reforms” or not? The way those decisions were taken mattered – the values of the people who took them mattered. To my mind, had Fraser and Howard or their ilk presided over the 1983–96 transition, things would have been infinitely worse for working people than the result under Hawke–Keating.
In the end, however, an argument that the other side of politics would have been worse is deeply unsatisfying and intellectually dishonest. Much of what happened under Labor was clearly bad. Exhibit A is the terrible recession of the early 1990s that saw the destruction of whole industries (including some, like the car industry, that limped along into the new century), communities and social democratic institutions. Transition was managed poorly, and the argument that “laid-off factory workers got better jobs” belies the evidence of regional and demographic breakdown of unemployment, welfare dependency and poverty. A more fundamental reckoning with the societal legacy of the Accords is needed.
In my view, the 1980s reformist project has run its course, with the consequences of its inherent neoliberal logic clear in policy areas as diverse as Australia’s dysfunctional labour market, our largely non-existent climate policy, and the design of the National Disability Insurance Scheme. The project now necessary for the labour movement is to deal properly with the residual legacy of the Accord period and to decide what is next. As Gramsci wrote in the Prison Notebooks, “The crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum a great variety of morbid symptoms appear.”89
For me as a unionist, the challenge posed by How Labor Built Neoliberalism is how we ought to use the lived experience of the Accords to determine a future agenda for working people. To return to Keating’s analogy of rotten teeth, the question is: What are the lessons to be learned and what is the way forward from the experience of the union movement as we hold our collective mouth open for the pliers?
First, it is necessary for the labour movement, and unions in particular, to acknowledge our collective responsibility for a range of the morbid symptoms that continue to blight Australia. The Accord era gave us labour market deregulation, privatisations and the individualised, casualised and outsourced economy we now inhabit. We did much of this to ourselves, even if the job was taken up with relish by subsequent Coalition governments.
The second lesson is that Hawke and Keating viewed social democracy as premised upon harmony between labour and capital. That is not an argument without force but can have the explanatory power to inform the practical program of a centre-left party only if capital is up for the deal. An important legacy of the Accords is that we were unilaterally disarmed with no concession whatever from capital. The evidence of the Accord period and since (as evidenced by disputes at Mudginberri, Robe River, Dollar Sweets, Patricks and so many others) is that Australian capital is unwilling to reach an accommodation with organised labour. Indeed, it is, and remains, committed to its destruction. This is why, absent of any major new organising and rebuilding power initiatives, I find the current push within some labour circles for “workers on boards” to be quaint and frankly pointless. The co-determination model in Germany and elsewhere was a product of a moment in time – a period of organised power, and of the need for post-World War II capital to make an accommodation with organised labour as a bulwark against, if not communism, then at least against a very muscular socialism. But now, in Australia? What, for example, would a worker on the National Australia Bank board be able to do?
Third is the fact that the labour law changes made as part of the Accord have been about ensuring what in the period leading to the adoption of the National Labor Relations Act in the USA was called “labor peace.” These changes were explicitly not to facilitate big gains for workers or new organising but rather a response to what capital rightly saw as a crisis. The proper translation of “labor peace” is “extinguish militancy.” Just as that US statute in the 1930s was a response to widespread militancy in the form of sit-down strikes by Congress of Industrial Organisations-aligned unions, the Accords (bolstered by earlier changes outlawing secondary boycotts) were a response to 1970s militancy and redesigned Australian industrial law to limit solidarity between different groups of workers and curb the scope for new organising. The Australian Building and Construction Commission laws that apply to commercial construction is where the mask slips: they are obviously and explicitly committed to the extermination of the construction unions by making basic organising next to impossible.
The reality is that most Australian workers, except those at certain economic choke points and in industries with relatively low net labour costs relative to capital investment, will always struggle to win big gains at a firm level. An urgent task for the union movement is to reimagine labour law as one that is expressly permissive of industrial conduct, promotes the building of solidarity between groups of workers both within and across industries, and which facilitates organising at scale. Industrial law needs to not be about keeping workers quiet but about amplifying their voice.
Fourth, it is a sad truth that unions are, in almost all cases, still structured to exercise the power we had before and during (at least the early part of) the Accords. For the most part, unions are still not structured to build the power working people so desperately need to win, but rather are structured around forgotten power. Unions are fundamentally about aggregating the power of people and a small portion of their money. So much of the way unions are structured and governed divides as much as it aggregates. The formation of the United Workers Union, which has a unitary national structure, which is organising nationally along industry lines and which has dedicated itself to building solidarity between different groups of workers, is a beacon of hope.
Finally, we must absorb the lesson that we need the union movement for the economy we have, not the one we used to have, or the one for which some might pine. The reality is that a bloke with a tool is not representative of today’s Australian unionism or even our economy. The reality is that most of the strongest unions we have are women-dominated and in sectors like health and education, and generally (but not only) based in the public sector. This is an enormous strength for the Australian union movement. And just as the US United Auto Workers Union, under the leadership of its visionary president Walter Reuther, supported the formation of new unions in the public sector using the large resources of that union, we must find a way to support organising amongst the vast proportion of the Australian workforce who so desperately need a union from the coffers of our existing organised workforce. As public sector workers in places like Wisconsin have found out, unionised workforces struggle to survive as isolated islands of collective bargaining “privilege.”
How Labor Built Neoliberalism is a scholarly, erudite and persuasive account of Labor’s neoliberal turn and of the Accords. It should be widely read by labour historians, political economists, unionists and Labor politicians.
Rejoinder: Elizabeth Humphrys
It is an unexpected delight to take part in this roundtable on my book How Labour Built Neoliberalism. As anyone who has written a book is aware, you do not know how it will be received after it is released into the world. You hope it will find an audience – or better yet interlocutors – beyond those academics who are expert in the area. Luckily, I have been delighted by the response to the book and challenged by those who disagree or want to debate some of the more controversial and uncomfortable things it raises. The four authors who subjected the book to critical analysis in this journal have my appreciation for contributing, and for challenging me to think again about various questions.
In 1996, I was studying community development at a TAFE college in Broadmeadows on the northern outskirts of Melbourne. It was there I came across Jane Kelsey’s Economic Fundamentalism: The New Zealand Experiment.90 Kelsey’s book painstakingly detailed the implementation of neoliberalism by the New Zealand Labour Party (so-called Rogernomics) between 1984 and 1990, and its social and political consequences for the tiny nation. Kelsey’s book was one of those moments for me and I felt I had, for the first time, a framework that might be up to the task of understanding what had happened in Australia in the previous 13 years. I found myself at TAFE after finishing two years as a full-time student union official at the University of Melbourne and then the National Union of Students. I was burnt out by years of full-time activism aimed at trying to stop the wind back of free education and the reduction of income support for students and young people. The Kennett Liberal government had been elected a few years earlier and fighting the assault on students’ unions – which the government attacked with the same gusto it reserved for trade unions – had taken considerable energy. Going to TAFE was time to reflect, as much as anything, on what had happened politically in those years. Thinking about or dealing with the consequences of that era was never far from my mind as an activist and unionist, although it was not until a decade and a half later that I started my doctoral research on the Accord.
I grew up in a working-class family in Werribee, in Melbourne’s outer West, and the 1980s and 1990s were tough. In many ways, we were lucky. We did not have a lot of money, and my mum returned to work to ensure we could pay bills, although we still almost lost our house during the period of double-digit inflation and mortgage rates. Even when my Dad was made redundant from working in the Altona oil refinery, in the wake of the 1991 recession, he was one of the few who found other work. I tell you all this, perhaps for the same reason Frank Bongiorno includes some of his family history in his contribution, to make the point that the economic crisis and the policies of the Accord are not simply a matter for scholarly debate. Real people lived through their impacts. Of course, having a certain background or experience does not mean your analysis offers some sort of value-free insight into what occurred or that it is free of political ideology. In examining periods of economic change, we are analysing politics itself. As Joan Robinson reminds us, analysis “dealing with actual events encounters the difficulty that the answers to economic problems are only political questions. With politics comes ideological prejudice.”91 I have tried as much as is possible to be candid about my politics (or prejudices), in reconsidering the impact of the Accords with the benefit of several decades’ distance.
At the centre of my book is a challenge to readers to shift how we view the nature of the state. I ask what the state’s particular interests are in times of economic crisis and seek to better understand how the state incorporates dissident sections of the population into new projects of economic transformation. Grasping how the state incorporates dissent from civil society, and often repurposes it for other ends, is essential if we are going to build a more just world. The strategic question is, as both Tim Lyons and Lee Rhiannon point out, how we build an independent union movement with the social power to reshape society fundamentally. As Rhiannon outlines in her contribution in this roundtable, collective action – in particular when exercised by workers going on strike – can lead to transformative change. Because of the power that workers hold at the point of production, it is “political industrial action” that has been key to past wins and “where legislation was needed to enshrine progressive change MPs acted in response to public pressure. They were not the initiators of change.” Of course, it was the very nature of the Accords, as state-initiated economic planning from above, that meant they could never contain within them the power to transform society in the way that many involved hoped. And as Lyons points out above, the “labour movement changed our society [through the Accords], with mostly good intentions, but in a way that had profound and deleterious effects on our own movement’s institutional power.”
Being clear on the nature of the capitalist state and how its interests diverge from that of the labour movement is crucial. Many analysts argue that the Accords were the best we could have hoped for in the circum- stances, and Lyons, Bongiorno and Ian Hampson all appear to fall into this camp. Bongiorno hints at this in his critique above stating that I might not have given “enough weight to the political contest itself, which invariably conditioned what the government could do.” This is undoubtedly true, given the specific shape and outcomes of the Accords were related to the relative power of labour as the 1980s and 1990s dragged on. However, the strategic decision to enter the Accord – and not to break with it when it failed to be implemented – is primary in the political contest in my view. The Accords voluntarily drew the unions into wage suppression and enwrapped them in the state’s priorities, enacting those objectives through the arbitration process. As Michael Beggs notes, the agreement achieved the suppression of real wages, which had “proven impossible to impose from above” and made real the “long held dream of Australian macroeconomists.”92 This is why I argue that the Accords, as a macroeconomic process to suppress wages and industrial action, were enacted both from above and below by consensually incorporating the labour movement (via its unions) into state-led neoliberal restructuring. The strategic decisions of the labour movement matter, including in periods of economic crisis and setbacks for labour, and ultimately the horizons of the political contest were vigilantly delimited by the Accord process itself.
Hampson’s contribution is the one that takes up the question of the nature of the state in more explicit terms, getting closer to the heart of the problem for me. Yet, I was surprised he did not tackle directly my analysis as to the relationship between the state and civil society – in particular, how the former seeks to incorporate the latter into new rounds of accumulation and exploitation. Utilising a Gramscian analysis is not a question of simply picking a (Marxist) theorist off the shelf; it is to ask what concepts and frameworks help us understand what happened in a particular period and why. Gramsci’s concept of the integral state is central to my book and, when used to analyse the vanguard neoliberal period in Australia in the 1980s, it points us towards how the state can mobilise the power of the union movement for its own interests. The concept helps us understand how the state could shape and reshape the Accords, to be fit for a different purpose of macroeconomic structural adjustment. If we fail to consider the nature of the state, and the nature of social contracts as mechanisms of wage suppression and labour market discipline, we can be left with the conclusion that the deleterious impacts were simply because the timing was not right. In my opinion this is a mistake, and it is the nature of social contracts – which I argue are always a tool to manage labour and wages – that are at the heart of this issue. In that sense, Hampson’s piece treads some well-covered ground on the motivations for the Accords and, in the end, I fear he is in the same boat as those who were caught up in the idea that we just needed to extend the corporatism of the Accord against the neoliberal trajectory of the Hawke government rather than seeing these (corporatism and neoliberalism) are integrated parts of totality. I think this is why Hampson can put forward his lengthy analysis of Australia Reconstructed, stating it supplements my analysis and implying I do not give it serious consideration, when in fact I mention it 16 times and devote a six-page section to it.93 Rather, what is occurring is a disagreement between us about the nature of the state and what is the role of a social contract. That Hampson still sees Australia Reconstructed as “both a high point of union policy development in Australia, and testimony to the maturation process going on in the Left,” rather than the last-ditch effort of those losing the battle over economic structuring, provides a sense of the problem. Our task is to deal with the question: How did a militant trade union movement, at its strongest point in history, come to be incorporated into neoliberal economic transformation? Other than a retreat into a general “it was the best we could do in the circumstances,” this question remains unanswered by Hampson.
One criticism made of my book, as Bongiorno puts it, is that my approach “ignores or struggles to incorporate” many of the constructive policies that occurred in the Hawke–Keating era. He lists a number of these policies including “Medicare, environmental protection, the Sex Discrimination Act, the capital gains tax, the fringe benefits tax, the superannuation guarantee, targeted family payments, improved school retention rates, and a significant expansion of tertiary education.” There is no doubt that these policies had benefits for workers, even if some were less than we might have ideally hoped for in the way they were structured. Rhiannon responds to this challenge in part, when she argues above that, nearly four decades on, “it sounds absurd that a Labor government would push for wage restraint as a precondition for delivery of Medicare, increased investment in education and other reforms to which working people are surely entitled. A Labor government should have delivered these reforms without robbing workers of their income.” Further, she writes that “better on the job conditions and lifting living standards is vital but at all stages of struggle it is essential that people’s collective participation is part of the process.” I agree with her, as a wage rise and a tax cut are not interchangeable – a fight for the former is the direct exercise of the power of labour, whereas the social wage gains of the Accord were formulated and implemented from above. It is important to appreciate how the Accord was a consensual process that brought about a profound shift in the locus of labour organisation – moving it from the level of workplaces and the rank and file to that of high-level negotiations and central planning. Where worker agency and militancy were central to the labour movement’s achievements during the long boom and through much of the 1970s, the Accord was a shift to state agency and delivered a sharp curbing of labour’s interests. This is why I argue the Accord process involved trade unions disorganising themselves through the suppression of wages and industrial action.
More generally, my point is not to argue that there were no progressive policy gains in the Accord period, but to highlight that if we understand the Accord as a process or incorporation of a powerful union movement into a process of structural adjustment – where the explicit terms of the agreement sought by the ACTU were to trade off wages for social wage gains – then these reforms are, as the aphorism says, the spoonful of sugar to make the medicine go down. Moreover, on one level I do not think Bongiorno, Lyons or Hampson, would argue this was not the case. The issue is, as I am arguing, the medicine was one the state desired to “cure” the economy of its internal contradictions on particular and partisan terms – that there is no such thing as a national interest and the sweeteners were to ensure the state’s interests won out.
The issue of the social wage is perhaps the key point of contention in analyses of the Accord historically, and perhaps it is worth quoting from my book on this:
Deploying a balance sheet of progressive and regressive reforms in this way effectively reads history backwards. Such positions argue that even if the overall outcome in the Accord era was negative, entering an alliance with the government based on sacrifice in the national interest produced a better result than elsewhere. Such an approach presumes the inevitability of harsh neoliberal restructuring under any alternative hypothetical scenario. Furthermore, it is an approach that interprets small wins within wider and deeper losses parallel to the process of neoliberalisation – rather than as concessions or “sweeteners,” designed to smooth the incorporation of the labour movement and disadvantaged social groups into the restructuring process itself (as part of gaining their consent for going against their own social interests). This separation obscures the role of the union movement within the state’s political project and in actively constructing neoliberalism.94
Most of the contributions in this roundtable are, rightly, focussed on the future of the labour movement and progressive social movements in Australia, and I would agree with Lyons that we cannot know where we are going until we understand where we have been. However, this seems particularly pertinent in regard to the Hawke–Keating era, given many continue to lionise the period as the high point for political and industrial labour. The point of revisiting the Accord is also to gain clarity on labour’s relationship to neoliberalism, and how the Accord held within it the key components of neoliberal reform. Each country that proceeded down a neoliberal path enacted a class-based political project to attack the wage and condition claims of workers and enact a generalised disciplining of the labour movement to ensure this could take place. The process differed across geographic regions, but the objective was similar – underlining that neoliberalism is at once a national and global process. Although the methods of vanguard neoliberal advance in Australia were distinct from what we think as “typical” neoliberalism – such as in the USA and the UK where the New Right governments of Ronald Reagan and Margaret Thatcher imposed economic reform on labour – similar objectives were achieved, consensually, through the Accord. Ultimately, it was through the organisational leadership of the labour movement and the ALP, within a state-centred project, that labour was incorporated into the project of building neoliberalism in Australia.
Labour History, Number 118 (May 2020): 135–76 https://doi.org/10.3828/jlh.2020.7 © 2020 Australian Society for the Study of Labour History ISSN 0023-6942
Footnotes
- Elizabeth Humphrys, How Labour Built Neoliberalism: Australia’s Accord, the Labour Movement and the Neoliberal Project (Leiden: Brill; Chicago, IL: Haymarket Books, 2018), 8.
- Ibid., 177.
- Ibid., 7.
- Ibid., 31.
- Ibid., 226.
- Michael Koziol, “Kevin Rudd Overturned Decision on Prime Minister’s Literary Award, Say Judges,” Sydney Morning Herald, 11 June 2016.
- Frank Bongiorno, The Eighties: The Decade That Transformed Australia (Collingwood, Vic.: Black Inc, 2015), 176–77.
- Peter Ewer, Ian Hampson, Chris Lloyd, John Rainford, Stephen Rix, and Meg Smith, Politics and the Accord (Leichhardt, NSW: Pluto Press Australia, 1991).
- Tim Lyons, “The Labour Movement: My Part in Its Downfall,” Meanjin 75, no. 3 (2016): 87–95.
- Ibid., 91.
- Macphee to Fraser, 2 November 1975, Malcolm Fraser Papers, 106/20, M File, University of Melbourne Archives.
- Humphrys, How Labour Built Neoliberalism, 93–101.
- Canberra Times, 27 August 1977, 1.
- Study Group on Structural Adjustment, Report, 1979: Study Group on Structural Adjustment, Vol. 1 (Canberra: Australian Government Publishing Service, 1979).
- Committee of Inquiry into the Financial System, Australian Financial System: Final Report of the Committee of Inquiry, September 1981 (Canberra: Australian Government Publishing Service, 1981).
- Raewyn Connell, Southern Theory: The Global Dynamics of Knowledge in Social Science (Cambridge; Malden, MA: Polity, 2007).
- George Megalogenis, The Australian Moment: How We Were Made for These Times (Camberwell, Vic.: Penguin, 2015).
- Emily Millane, “The Ghost of National Superannuation” (PhD diss., Australian National University, 2020).
- Sarah M. Cameron and Ian McAllister, Trends in Australian Political Opinion: Results From the Australian Election Study 1987–2016 (Canberra: School of Politics and International Relations, Australian National University, 2016), 87; Shaun Wilson and Trevor Breusch, “Taxes and Social Spending: The Shifting Demands of the Australian Public,” Australian Journal of Social Issues 38, no. 1, (February 2003): 39–56.
- Peter Whiteford, “Australia: Inequality and Prosperity and Their Impacts in a Radical Welfare State,” in Changing Inequalities and Societal Impacts in Rich Countries: Thirty Countries’ Experiences, ed. Brian Nolan et al. (Oxford: Oxford University Press, 2014), 48–70.
- Bongiorno, The Eighties.
- George Megalogenis, The Longest Decade (Melbourne: Scribe, 2006).
- Humphrys, How Labour Built Neoliberalism, ch. 5.
- Ibid., 29.
- Ibid., 155, 159, 226, 228.
- John Bellamy Foster, “Absolute Capitalism,” Monthly Review 71, no. 1 (May 2019): 1–13.
- Fred L. Block, The Origins of International Economic Disorder: A Study of United States International Monetary Policy From World War II to the Present (Berkeley: University of California Press, 1977).
- Foster, Absolute Capitalism, 2.
- Michael Pusey, Economic Rationalism in Canberra: A Nation-Building State Changes Its Mind (Sydney: Cambridge University Press, 1991).
- Peter Ewer, Winton Higgins and Annette Stephens, The Unions and the Future of Australian Manufacturing (London: Allen and Unwin, 1987).
- Susan George, “The Growing Power of Illegitimate Authority,” E. L. “Ted” Wheelwright Memorial Lecture, University of Sydney, 29 August 2013.
- Damien Cahill and Phillip Toner, eds, Wrong Way: How Privatisation and Economic Reform Backfired (Carlton, Vic.: La Trobe University Press, 2018).
- Humphrys, How Labour Built Neoliberalism, 141, cf 71, 117. Although Humphrys also treats economic rationalism and neoliberalism as “synonymous” on p. 4, I would argue economic rationalism has (or had) a more national focus.
- Ibid., 140.
- John Braithwaite, Regulatory Capitalism: How It Works, Ideas for Making It Work Better (Cheltenham: Edward Elgar, 1988).
- Kathleen Thelen, Varieties of Liberalization and the New Politics of Social Solidarity (Cambridge: Cambridge University Press, 2014).
- Humphrys, How Labour Built Neoliberalism, 3, 57, 154.
- Ibid., 94.
- Ewer et al., Politics and the Accord.
- Leo Panitch, “Trade Unions and the Capitalist State,” New Left Review 124 (1981): 21–44; Adam Prezeworski, “Social Democracy as an Historical Phenomenon,” New Left Review 127 (1980): 27–58.
- Winton Higgins and Geoff Dow, Politics Against Pessimism: Social Democratic Possibilities Since Ernst Wigfors (Bern: Peter Lang, 2014); Winton Higgins and Nixon Apple, “How Limited Is Reformism?” Theory and Society 12 (1983): 603–606; Walter Korpi, The Democratic Class Struggle (London: Routledge and Kegan Paul, 1983); Winton Higgins, “Political Unionism and the Corporatist Thesis,” Economic and Industrial Democracy 6 (1985): 349–81.
- For example, see Peter Evans, Dietrich Rueschmeyer and Theda Skocpol, eds, Bringing the State Back In (London: Cambridge University Press, 1985).
- For example, see John Stephens, The Transition From Capitalism to Socialism (London: MacMillan, 1979).
- On pp. 158–59, Humphrys suggests that I have “failed to interrogate the assumptions behind corporatist frameworks as they relate to the advance of vanguard neolib- eralism.” I respectfully suggest this boot might be on the other foot.
- Ian Hampson, “The End of the Experiment: Corporatism Collapses in Australia,” Economic and Industrial Democracy 18, no. 4 (November 1997): 539–66; Peter Katzenstein, Small States in World Markets (Ithaca, NY: Cornell University Press, 1985).
- T. J. Pempel and Keiichi Tsunekawa, “Corporatism Without Labour? Japanese Anomaly,” in Trends Towards Corporatist Intermediation, ed. Phillip Schmitter and Gerhard Lehmbruch (London: Sage, 1979), 231–70.
- Katzenstein, Small States in World Markets, 30–34.
- Pusey, Economic Rationalism; Bongiorno, The Eighties, 52, 286.
- Francis Castles, Australian Public Policy and Economic Vulnerability (Sydney: Allen and Unwin, 1988).
- Rudolf Meidner, “On the Concept of the Third Way: Some Remarks on the Socio-Political Tenets of the Swedish Labour Movement,” Economic and Industrial Democracy 1, no. 3 (1980): 343–70.
- Ian Hampson and Åke Sandberg, “The Swedish Contribution to Job Quality,” in The Oxford Handbook of Job Quality, ed. Chris Warhurst and Chris Mateau (Oxford: Oxford University Press, forthcoming).
- Rudolf Meidner, “Swedish Union Strategies Towards Industrial Change,” Economic and Industrial Democracy 7 (1986): 85–97; Higgins and Apple, “How Limited Is Reformism?”
- Australian Council of Trade Unions/Trade Development Council (ACTU/TDC), Australia Reconstructed, (Canberra: Australian Government Publishing Service, 1987).
- Ewer, Higgins and Stephens, The Unions and the Future of Australian Manufacturing.
- Lars Calmforrs and Jurgen Driffel, “Bargaining Structure, Corporatism and Economic Performance,” Economic Policy 6 (April 1988): 13–61.
- Peter Hall and David Soskice, Varieties of Capitalism: The Institutional Foundations of Comparative Advantage (Oxford: Oxford University Press, 2001).
- Wolfgang Streeck, How Will Capitalism End? (London: Verso, 2016).
- Kathleen Thelen, Varieties of Liberalization and the New Politics of Social Solidarity (Cambridge: Cambridge University Press, 2014).
- Humphrys, How Labour Built Neoliberalism, 7.
- Ewer et al., Politics and the Accord.
- Weekend Australian, 30 June 1991, 4.
- Frank Castles, Australian Public Policy and Economic Vulnerability (Sydney: Allen and Unwin, 1988).
- Korpi, The Democratic Class Struggle.
- ALP/ACTU, “Statement of Accord by the Australian Labor Party and the Australian Council of Trade Unions Regarding Economic Policy,” February 1983, in National Economic Summit Conference, 11–14 April 1983, Documents and Proceedings, Government Documents (Canberra, Australian Government Publishing Service, 1983), 407–26.
- Sydney Morning Herald, 21 April 1984.
- Metal Trades Federation of Unions, Policy for Industry Development and More Jobs (Sydney: MTFU, 1984).
- Ewer et al., Politics and the Accord.
- Pusey, Economic Rationalism.
- John Mathews, “From Post-Industrialism to Post-Fordism,” Meanjin 48, no. 1 (1989): 149.
- Ewer et al., Politics and the Accord, chapter 7.
- Ian Hampson, “Training Reform: Back to Square One?” Economic and Labour Relations Review 13, no. 1 (June 2002): 149–74; Phillip Toner, “A Tale of Mandarins and Lemons: Creating the Market for Vocational Education and Training,” in Wrong Way: How Privatisation and Economic Reform Backfired, ed. Damian Cahill and Phillip Toner (Melbourne: La Trobe University Press, 2018).
- Winton Higgins, “Industrial Democracy and the Control Issue in Sweden,” in Democracy and Control at the Workplace, ed. Ed Davis and Russell Lansbury (Melbourne: Longman Cheshire, 1986).
- John Womack, Daniel Jones and Daniel Roos, The Machine That Changed the World (New York: MacMillan, 1990).
- Christian Berggren, Alternatives to Lean Production: Work Organisation in the Swedish Auto Industry (Ithaca, NY: ILR Press, 1992).
- Ian Hampson, “Post-Fordism and the Politics of Industry Development in Australia” (PhD diss., University of Wollongong, 1995); Ian Hampson, “The Accord: A Post-Mortem,” Labour and Industry 7, no. 2 (1996): 55–77.
- In the academic sphere, John Mathews, Tools of Change (Melbourne: Pluto, 1989) was representative of this view. In the realms of union activism, Laurie Carmichael, “After the Revolution: Micro Chips With Everything,” Australian Left Review (May–June 1989): 23–25 was significant; also see John Buchanan and Chris Briggs, “Rethinking Left Productivism: Union Strategy and the Labour Process in Australia Since the End of the Cold War” (paper presented to the 22nd Annual Labour Process Conference, Amsterdam, 5–7 April 2004).
- Hampson, “Post-Fordism and the Politics of Industry Development”; Ian Hampson, Peter Ewer and Meg Smith, “Post-Fordism and Workplace Change: Towards a Critical Research Agenda,” Journal of Industrial Relations 36, no. 2 (June 1994): 231–57.
- Ian Hampson and David E. Morgan, “Post-Fordism, Union Strategy and the Rhetoric of Restructuring: The Case of Australia, 1980–1996,” Theory and Society 28, no. 5 (October 1999): 1–50.
- See the passages I excerpted in Hampson, The End of the Experiment.
- Matthew Taylor, “Trade Unions Around the World Support Global Climate Strike,” Guardian, 19 September 2019.
- Anthony Forsyth and Carolyn Holbrook, “Australian Politics Explainer: The Prices and Incomes Accord,” The Conversation, 24 April 2017, accessed January 2020, https://theconversation.com/australian-politics-explainer-the-prices-and-incomes- accord-75622.
- Tom McDonald and Audrey McDonald, Intimate Union: Sharing a Revolutionary Life (Annandale, NSW: Pluto Press, 1998), 225.
- Patricia Drum, “ACTU–Labor Accord That Helped Shape Australia Is Gone, but Not Forgotten,” ABC News, 20 February 2018, accessed January 2020, http://www.abc.net. au/news/2018-02-20/hawke-whitlam-unions-historic-accord-revisited/9462332.
- Edgar Ross in W. J. Brown, The Communist Movement and Australia (Haymarket, NSW: Australian Labor Movement History Publications, 1986), 175.
- L. J. Brentano in Sidney Webb and Beatrice Webb, The History of Trade Unionism (London: Longmans Green and Co., 1911), 12.
- Stephen Long, “Have Australia’s Right to Strike Laws Gone Too Far,” ABC News, 21 March 2017, accessed January 2020, http://www.abc.net.au/news/2017-03-21/ have-the-right-to-strike-laws-gone-too-far/8370980.
- Humphrys, How Labour Built Neoliberalism, 130.
- Dennis Glover, An Economy Is Not A Society: Winners and Losers in the New Australia (Melbourne: Black Inc., 2015).
- Antonio Gramsci, Selections From the Prison Notebooks (London: Lawrence & Wishart, 1971), Q3 §34, 276.
- Jane Kelsey, Economic Fundamentalism (London: Pluto Press, 1995).
- Joan Robinson, What Are the Questions? And Other Essays: Further Contributions to Modern Economics (New York: M. E. Sharpe, 1980), 106.
- Michael Beggs, Inflation and the Making of Australian Macroeconomic Policy, 1945–85 (Basingstoke: Palgrave MacMillan, 2015), 273.
- ACTU/TDC, Australia Reconstructed: ACTU/TDC Mission to Western Europe (Canberra: Australian Government Publishing Service, 1987).
- Humphrys, How Labour Built Neoliberalism, 153.
Lee Rhiannon 