The Business Council thinks the left has no plan? …

… That’s a bit rich

That’s the headline for my latest piece in The Guardian. Final paras

unlike the BCA, its opponents have been willing to specify the measures needed to pay for these desirable outcomes. Eschewing the small target strategy routinely recommended for opposition parties seeking office, Labor has announced a range of revenue measures that would finance a substantial expenditure program, combined with some tax relief for low and middle income households. These include scaling back negative gearing, crackdowns on tax evasion and avoidance, and a restoration of the 2% levy on top incomes.

The Business Council has long been a weak and ineffectual participant in Australian policy debate. If it is to be taken seriously, it needs more than astroturf front groups and websites. The Council needs to take on some of its members, both in relation to their corporate behavior and in their resistance to any tax reform that might cause them any pain. Until then, Jennifer Westacott should be more cautious in asserting that others lack a plan and believe in “fairies at the bottom of the garden

I haven’t yet had time to comment on the implications of the Royal Commission into Banking. Most of the obvious points have already been made, but I want to think about the deeper implications for financialised capitalism and its relationship to inequality and wage stagnation. Feel free to toss these issues around, as well as discussing the Guardian article.

8 thoughts on “The Business Council thinks the left has no plan? …

  1. The Guardian article is good. It’s pitched at the right level given that most people are not ready yet to think about more thorough-going solutions to capitalism. A critique of financialised capitalism would be a good place to start. It would resonate with people and the banks have made themselves very obvious targets. Eventually we need to go beyond a critique of financialised capitalism into a critique of capitalism itself. This critique needs to find its way into the main public media rather than just appearing in obscure specialised journals

    In the meantime, I would like to see advocacy for interest rate limits. When the official interest rates are so low, the very high interest rates on credit cards and personal loans are unconscionable. Regulation of mortgage loan books also needs to be much stricter.

    Students and former students need to be relieved of high student debt in some progressive manner. Placing debt on people before they have begun their working life proper is also unconscionable. This is especially so when banks are cheating, corporations are evading tax and businesses are failing to pay workers their correct salaries and superannuation components. All of these abuses are happening at system wide levels.

    We need Royal Commissions into Tax Evasion and Wage Payment Evasion.

  2. Corporate governance is broken in Australia. The BCA is not a ‘Business’ council, but rather a peak body for a cabal of 60 extremely powerful employees. Jennifer Westacott is not an ‘outsider’, such a laughable self-designation.

    It is interesting that the Royal Commission is not finding examples of unconscionable conduct by credit unions and other smaller ADIs. A royal commission into telecommunications, supermarkets or other areas dominated by big business would no doubt uncover similar mis-deeds by the members of the BCA and their direct reports

    We should stop treating the BCA seriously and treat it as it is – a rent-seeking front for bureaucrats in big business.

    Small business needs to harden uptake back the word ‘business’ from the BCA.

  3. @bjd from Aus
    a rent-seeking front for bureaucrats in big business.

    Surely you mean “swashbuckling entrepeneurs fighting their way through the free market jungle”.

  4. The hubris of the Business Council knows no bounds. Business continually claims that it is “the engine of Australia’s prosperity”. The engine of prosperity (or economic activity in general) is the entrepreneurial spirit, the ambition that causes people to take risks, expend energy, work long hours and invest their own money in the hope of creating something more reputable or more profitable in future. The entrepreneurial spirit is a feature of human nature that in a free society happens to be channelled into various corporate forms and does not derive from them.

    Hernando de Soto made the point that societies (such as those in Latin America) remain undeveloped (compared with the West) because they lack trustworthy land titling meaning that people can’t secure loans: business entrepreneurship depends upon credit. I think this argument is valid, but it is incomplete. It is not just land titling, but trustworthy institutions in general that allow a society to prosper, to liberate the entrepreneurial spirit.

    The contribution of civic services is completely invisible in Westacott’s narrative. Business would not even exist without corporations law. It could not transport goods without public infrastructure or deal honestly with other businesses without currency worth its value or prudential regulation of financial institutions. It wouldn’t know what a kilogram meant without a regulated weights and measures office and it relies on the public education system and the public health system to supply it with employees that are not too sick to work.

    For Westacott to claim that business private enterprise creates 86% of all jobs is a vacuous statement. Observing that 14% of jobs are within the public sector and 86% in the private sector tells us really nothing much at all.

    As Prof John’s Guardian article makes clear, the BCA’s agenda is incoherent and their failure to acknowledge business’ utter reliance upon civic services entirely invalidates their public advocacy.

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