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Prime Minister Kevin Rudd has dismissed the past 30 years of economic reform as “personal greed dressed up as an economic philosophy” and promised to regulate Australia’s economic affairs.
Make no mistake. The PM’s 7700-word essay, shortly to appear in left-leaning magazine The Monthly, spells disaster for those of us who have supported the current economic system over the past 30 years.
On 4 February 1979, Margaret Thatcher sold Her Majesty’s Government to Amstrad and Royal Dutch Shell, and ceased all regulation of the economy. She did so in the service of one man’s avarice, that of Friedrich August von Hayek (1899-1992), a man who made billions in academia and passed off his personal greed as the one of the most important contributions to 20th-century economic theory.
The power of ideas being what it is, Mrs Thatcher’s full and immediate deregulation of Britain touched off a series of similar reforms throughout the world.
Since that day, the economy has grown, bubble-like, pushing hundreds of millions of people into poverty while dramatically increasing inequality within the nations of the developed world.
For those of us old enough to remember that historic day 30 years ago, and for those who have enjoyed the fruits of the Great Deregulation, Mr Rudd’s words are chilling.
In effect, he is proposing that private banks be subordinated to some sort of “central” bank, that a commission lord it over competition and consumer affairs, that another commission have powers over securities and investments, that some sort of board review foreign investment. Such institutions would be harbingers of worse to come: state administration of justice, perhaps even one day a standing army.
Readers may not immediately recall, but the world prior to 1979 was a dark and socially sustainable place, where capital was allocated with the benefit of infinite wisdom, interest rates and inflation were low, and no-one ever cried.
Before the vast wastelands and seething underclass of today could be created, the world groaned under the weight of an oppressive fairness—humanity abandoned to a hopelessly fragrant garden of plenty.
An end to 30 years’ absence of state involvement in the economy will surely consign us once more to that fate.
For the Prime Minister to now demand we turn back the clock suggests one thing: that he is completely ignorant of what actually happened.
The PM's 7700-word essay dismantles these past 30 years of total worldwide deregulation.
