Abstracts – Labour History No. 98

Social Democratic Parties and Business:
An Historical Analysis

Edited by Geoff Gallop and Greg Patmore

Social Democratic Governments and Business
Geoff Gallop
and Greg Patmore

Given their traditional links to trade unions and the ideological Left, social democratic parties frequently face questions concerning their relationship with business. Three main issues arise in the labour history literature in regard to this relationship: ideological capture, business lobbying and corruption. The contributions to the thematic section of this issue offer a range of new and, in some ways, confronting, perspectives on the relationship between business and social democratic parties against the background of the push towards neo-liberalism in Australia, New Zealand and the United Kingdom since the 1980s. These articles also show that any study of the relationship between social democratic governments and business must go beyond the general and theoretical to engage with the particular and the empirical.

Business Mobilisation, the New Right and Australian Labor Governments in the 1980s
Damien Cahill

This article explores the relationship between social democratic parties and business through an examination of political mobilisations by employer associations in Australia during the 1980s, and the responses to these by successive Labor federal governments. In a period of ongoing crisis in the Australian and world economies, numerous employer groups mobilised politically to effect a neoliberal transformation of the Australian state and economy. Two broad strategies were adopted by employer groups to achieve this neoliberalisation. Some employer groups, including the National Farmers Federation, the Australian Chamber of Commerce and the Australian Federation of Employers, pursued a strategy of militant confrontation. Their strident neo-liberal rhetoric, close involvement with neoliberal think tanks, support for legal action against trade unions, and their use of popular mobilisations put them at odds with the Labor government. The Business Council of Australia, in contrast, pursued a more pragmatic strategy of engagement with the Labor government. While individual members of the Business Council had close and supportive relationships with neoliberal think tanks, it was the confrontationalist employer associations that, together with these neoliberal think tanks, came to be labeled the ‘New Right’. The article argues that the Labor government was able to use the perceived threat constituted by the New Right to achieve acquiescence within the Labor caucus and broader labour movement leadership to its less radical version of neoliberalism. Conversely, the confrontational strategies of the New Right helped the Business Council of Australia pursue an effective strategy of engagement with Labor.

Labor Neoliberals or Pragmatic Neolabourists? The Hawke and Keating Labor Governments in Office, 1983-1996
Joe Collins and Drew Cottle

The economic ‘reforms’ associated with the broader neoliberal agenda first found expression in Australia through the policies of the Hawke and Keating Labor Governments. This article examines the politics of this period using Antonio Gramsci’s notion of hegemony. It argues that the Hawke and Keating administrations were a ‘conjunctural episode’ in an ‘organic movement’ to re-establish ‘ruling class hegemony’ after the breakdown of the post-war capitalist order. The period of continuous Labor rule from 1983 to 1996 represented the birth of ‘neolaborism’, a pragmatic policy approach which sought to reconcile the problems of electoralism and ‘laborism’ that had plagued former Labor governments. Their ‘neolaborist’ agenda was underwritten by economic changes aimed at ensuring sustained growth coupled with corporatist agreements to appease organised labour. This article distinguishes the pragmatic policies of the ALP from the calculated tactics of an emerging neoliberalism.

New Zealand’s Fifth Labour Government (1999-2008): A Putative Partnership with Business and Society?
Peter Skilling

New Zealand’s fifth Labour Government, in power from 1999 to 2008, offers an insightful case study of a nominally social democratic party re-defining its relationship with business. On the basis that the government is, to a large extent, a linguistic activity, this article focuses on the Government’s political discourse, contrasting it with those of the two previous Labour administrations (1972-75 and 1984-90). Drawing on a critical analysis of the three Governments’ programmatic public statements, it describes how the fifth Labour Government addressed and constructed business interests in a new way. From 1999 to 2008, Labour presented the challenges of economic globalisation as the fundamental challenge facing the country, and urged all New Zealanders to work together. Within rhetoric of partnership, business was represented as a vital contributor towards a putatively shared national purpose in a way that denied the tensions between labour and capital allowed for under earlier local incarnations of social democracy.

The Ties that Unwind? Social Democratic Parties and Unions in Australia and Britain
Ashley Lavelle

The ties between social democratic parties and trade unions in recent years have been stretched almost to breaking point. Drawing on evidence from the experience of Australia and Britain, this article argues that a turning point in the deterioration of the relationship was the collapse of the post-war economic boom. This event was important because it ruptured the economic foundations of the policy base of social democracy and led to the adoption by social democratic parties of a pro-business neo-liberal policy framework aimed at restoring rates of investment and profitability. In turn, this new policy emphasis necessarily threatened the interests of organised labour. The current tension in relations is therefore not merely a reflection of the pressures associated with social democrats being in government. Rather, it is rooted in the gradual decline of the health of capitalism since the 1970s – a trend unlikely to be reversed in the near future.

Labor, Government Business Enterprises and Competition Policy

Long before the introduction of federal trade practices legislation or tariff reform, governments in Australia – especially Labor governments – attempted to reduce the costs or improve the quality of goods and services by establishing government business enterprises. With the rise of neo-liberalism industry policy of this kind all but disappeared. According to the National Commission of Audit (NCA), established by the Howard Government, there were only three circumstances in which Government Business Enterprises (GBEs) could be justified: when ‘the private sector was seen as incapable of delivering the required products or services’; when ‘the community considered it appropriate that government should own a firm that operated as a natural monopoly’; or when ‘the government wanted to fulfil a community service obligation’. This article offers a historically-grounded critique of the NCA’s position. It traces the history of GBEs as a spur to competition across the states and the Commonwealth. It shows that what counts, or doesn’t count, as a government’s ‘core activity’ is as much a matter of politics as it is of economics, and it locates the politics of the NCA within the broader neo-liberal project of limiting collective choice.

A Marriage of Convenience: Citibank: Hawke-Keating Labor and Foreign Bank Entry into Australia
Harry Knowles
, Greg Patmore and John Shields

This study explores the long- and short-term backdrop to the Hawke-Keating government’s decision in 1984-85 to include the US banking giant, Citibank, in the select group of 16 foreign banks granted an Australian banking licence. Such a development ran counter to decades of mutual distrust between the Australian labour movement, large foreign banks in general, and US multinational firms in particular. It was also by no means inevitable. Citibank’s success is attributable neither to structural imperatives per se nor to superior strategic acumen. Rather, it from derived from a shifting long-term interplay between structural factors, strategic and ideological intent and chance events. In particular, we highlight Citibank’s emergence as a significant player in non-bank financial services activity in Australian during the 1960s and ‘70s, an emergence that reflected persistent lobbying, well-timed market intervention, and serendipity. Equally, we argue that Federal Labor’s ultimate embrace of selected foreign banks, and of Citibank in particular, is best understood as a marriage of convenience. We also present evidence to show that the outbreak of amity between Labor and Citibank was by no means assured and that the immediate backdrop involved a complex process of positioning, probing, stand-off and trade-off between Labor neo-liberals, Reserve Bank and Treasury officials and Citibank executives.

Neoliberalism and Child Protection: A Deadly Mix
Martha Knox Haly

The impact of neoliberal policies in a department charged with protecting the most vulnerable members of our society, and those who are most at risk of slipping into poverty is examined. The consequences of the outsourcing of public welfare to the charitable sector and associated reductions in public welfare expenditure are explored in detail. The Department of Community Services (DoCS) is an illustration of the manner in which the negative effects of neoliberal policies persist through familial poverty and increased child abuse notifications – long after these policies have been softened and funding has been restored. This arises in part from the State Government having responsibility for operational delivery of Government Services, whilst the Federal Government has charge of macro-economic policies. Even though state funding for services increases under the Carr Labor Government, the demand for welfare services continues to escalate a consequence of Federal policies which dramatically increase the number of Australian households living below the poverty line. Comparisons are drawn between the ‘hard neoliberalism’ practiced by the NSW Coalition Governments and the ‘soft neoliberalism/social conservatism’ of the NSW Labor Governments. It is argued that the Carr Government engaged in soft neoliberalism, as it retained a contracted senior executive service, supported accommodation programs remained outsourced to the private sector and managerial systems of individually focused investigative processes were applied to DoCs staff.

Other Articles

The New South Wales Railway Commissioners’ Strategic Pre-Planning for the Mass Strike of 1917
Robert Tierney

There is evidence to suggest that senior management in the New South Wales railway service pre-planned for the waged staff’s withdrawal of labour in early August 1917, which preceded the mass strike. The aims of this strategic preplanning were to break the power and resolve of the railway unions. The article examines two strategies adopted by the senior management; the stockpiling of coal prior to the dispute as a means of weakening the capacity of a coal miners’ strike to disrupt the railway service; and the creation of a pool of conservative salaried railway staff within the Locomotive Branch, devoted to intensifying the productivity of waged labour and to eliminating rank and file militancy.

Australian [Mis]treatment of Indigenous Labour in World War II Papua and New Guinea
Noah Riseman

Leading up to World War II, Australian administrators and settlers constructed Papua New Guineans as primitives in contrast to white Australians. During the war, the negative stereotypes and disparaging attitudes justified exploitative recruitment, negation of indigenous agency, poor working conditions, inadequate compensation, and casual abuse. Certainly in the post-war period white Australians expressed some appreciation for Papua New Guinean participation in the war. But analysis of discriminatory experiences of Papua New Guineans working for Australia suggests that World War II was not a period of drastic change for Papua New Guinean labour. Rather, labour relations represented continuities of colonialism and adhered strictly to continuing racialisation of labour

Political Activism, Academic Freedom and the Cold War: An American Experience
Phillip Deery

Professor Lyman Bradley was chairman of the German Department at New York University and an executive member of the Joint Anti-Fascist Refugee Committee, listed by the US Attorney General as a subversive organisation. In 1951 he was fired and his long academic career ended. His dismissal, the first by the New York University on political grounds, raises broader concerns about the character of university governance and the fragility of academic freedom in the modern age. In most accounts of academic McCarthyism there have been two historiographical tendencies. One emphasises the overwhelming power of institutions that were allied with McCarthyism; such political power rendered impotent any academic resistance. The other argues that academic McCarthyism was only effective because professors were too timid or frightened to act publicly or collectively in defence of academic freedom. This study will demonstrate that neither can solely explain Bradley’s political persecution. The denial of civil liberties and the violation of academic freedom required three interlocking factors: a powerful congressional committee, a determined University administration and a complicit academic staff.