Former Labor PM Kevin Rudd has recently published an essay, “The Case for Courage,” which is really an exercise in nostalgia for the Third Way. The essay heralds Rudd’s return to domestic politics after a self-imposed exile in the United States following his 2013 election defeat.
“The Case for Courage” is part of Rudd’s broader campaign advocating for a royal commission into Rupert Murdoch’s News Corp. However, when asked at the essay’s Melbourne launch what such an inquiry would investigate, he was strangely coy. Exhibiting uncharacteristic humility, Rudd said it should be up to the legal experts to work through the terms. Although he conceded that he had been personally hurt by News Corp’s hostile coverage of his government, Rudd seemed intent on not making his project seem like a personal crusade.
Rudd has good reason to feel wronged. News Corp’s coverage of his response to the 2008 global financial crisis was pure spin. Rudd acted early, providing stimulus checks directly to households in a move that helped Australia avoid a recession. But Murdoch media cast him as the leader whose reckless spending put an end to Australia’s budget surplus.
Despite this, Rudd and Labor are now employing the same anti-debt, anti-deficit rhetoric to criticize the most recent Liberal budget. This is just one indication that Rudd’s “Fourth Way,” as he calls it, is indistinguishable from the Third Way that has led to Labor’s current malaise.
The nefarious role of Murdoch’s News Corp in moving the Australian polity to the right is an obsessive concern of Rudd’s, as well as the liberals fawning over the ex–prime minister’s latest offering. For many liberals, Murdoch embodies everything that is wrong with the world.
This analysis of the malign influence of the Australian media is not original. Much of Rudd’s argument about how News Corp undermines democracy repeats the analysis Robert Manne made more forensically twenty years ago. Rudd characterizes News Corp as a company waging a psyops campaign aimed at manipulating voters who would otherwise flock to Labor:
Their mission is simple: to so paralyze the people with fear that it induces a psychological reaction on the part of the voting public that cause them to cling to conservative politics, under the illusion that, by doing so, certainty can somehow magically be restored.
The problem with this analysis is that it takes two points for granted: first, that News Corp wields enormous power, and second, that the company uses this power to keep the Australian Labor Party (ALP) out of power. However, in Rudd’s home state of Queensland, where Murdoch’s media ownership is most concentrated, Labor has been electorally dominant in state politics since Joh Bjelke-Petersen left office in 1987.
This suggests that News Corp’s main goal isn’t to shift voters. Time spent reading the Australian or the Herald Sun and watching Sky News will make it clear that these outlets are not really trying to persuade the electorate to support one party over another. Rather, their aim is to set the agenda.
Take News Corp’s campaign, in the lead-up to the 2018 Victorian election, about African gangs supposedly causing havoc in Melbourne. Rehashing every racist law and order trope didn’t swing many voters to the conservative alliance. But it did push Victorian politics to the right, as Labor premier Daniel Andrews bent over backward to be seen as “tough on crime.” This is News Corp at its most dangerous: actively pandering to the far right, setting the political agenda for the center-right, and ensuring the center-left follows its orders.
Misunderstanding the Liberals
In the remainder of Rudd’s essay, he lays out his desired path to a Labor victory. Along this journey, Labor must launch a negative campaign against the Liberals that accuses them of appropriating much of Labor’s economic program. Consequently, the focus of Rudd’s criticism is on the moral, rather than political, shortcomings of his opponents. Labor, according to Rudd, is the natural home of anyone who doesn’t think of themselves as greedy, corrupt, and racist.
“The Liberals’ overall ideological project is now, almost literally, bankrupt,” Rudd proclaims. The reason for this, he suggests, is because the pandemic has forced Scott Morrison’s party to embrace big government. “By any measure,” he continues,
the entire basis of the Liberal Party’s rolling campaigns against Labor’s fiscal stimulus, debt and deficit, deliberately aimed at fostering people’s anxiety, fear and anger over “Labor’s economic mismanagement,” has now been proven to have been a lie all along.
Even staunch critics of Keynes like the US economist Robert Lucas conceded that everyone is a Keynesian in a foxhole. That doesn’t mean they have changed their tune for good.
The deeper problem is that Rudd misunderstands the Liberals’ ideological project. In fact, stimulus spending is perfectly in keeping with pro-business politics. Morrison’s 2020 spending packages largely socialized capital’s losses.
What matters is not the amount of money the Liberals were willing to spend but how and where they directed these sums. They allowed large, profitable businesses to claim JobKeeper support payments during the height of the pandemic.
The New Dailyreported that more than sixty publicly listed companies received JobKeeper and other handouts, despite recording combined profits of more than $8.6 billion over the past eighteen months. Since April 2020, these businesses have funneled over $3.6 billion in dividends to investors.
Meanwhile, public services have not benefited from such unconditional generosity. In fact, the government punitively barred universities from claiming JobKeeper, even though they had to deal with huge losses because of the decline in foreign-student numbers. Arguing over the value of deficit spending diverts attention from the patently regressive nature of the Liberal relief measures.
Rudd’s Campaign Pitch
Labor should be homing in on the contrast between Liberal profligacy in doling out money to big business and the austerity they apply to everyone else. The party could then run a positive campaign, building on strong community sentiment in favor of rebuilding social services, defending the public sector, and reducing inequality. But this would require Labor to actually break with its four-decade-long commitment to neoliberal orthodoxy.
Rudd is unable to provide a clear-eyed look at the real challenges his party faces. Instead, he uses his misinterpretation of Liberal stimulus spending to justify his proposal for Labor’s negative campaign. “The marketing men of the Liberal Party,” Rudd remarks, “may seek to use the COVID-19 crisis to try to reinvent themselves as ‘Labor-lite.’”
Rudd’s comments are particularly telling. They reveal his own sclerotic vision for Labor: an amorphous commitment to big government spending combined with an unwillingness to confront the interests of capital. Rudd masks the similarities between his own project — an accommodation with the Right — and that of the Liberals by dubbing it the “Fourth Way.” This perfectly captures the unimaginative vacuity and conservatism of his program.
The former prime minister’s recipe for a prosperous future appears hollow when examined up close. Rudd’s program includes large-scale investment in STEM training, “the creation of a critical mass in Australian venture capital funds,” and a focus on developing “new technology industrials” like “AI, big data and blockchain.” Basically, the Third Way infused with a touch of Silicon Valley tech optimism.
Rudd doesn’t like calling for the government to create jobs. Instead, he proposes “a new National Jobs and Training Agency to provide retrenched or otherwise longer-term unemployed workers with a universal training guarantee for newly emerging industries.” This is almost indistinguishable from former Liberal PM Malcolm Turnbull’s vision of an “ideas boom.”
With wages stagnant and unions still in decline, Labor has lost much of its historic voting base. Unsurprisingly, Rudd refuses to grapple with his party’s responsibility for these trends, which date back to the 1983 Prices and Incomes Accord, introduced by Labor PM Bob Hawke. Rudd’s preferred option is for Labor to broaden its base:
For the Labor Party to secure 50-plus per cent of the two-party preferred vote in the future, and a primary vote north of 40 per cent, it must garner new levels of support from small business, independent contractors and sole traders, most of whom operate outside the traditional industrial relations system.
This overlooks the fact that many independent contractors and sole traders operate outside of the traditional industrial-relations system because the system has failed them. Loopholes in employment law have allowed businesses to strip workers of the rights afforded to full-time workers by classifying them as contractors.
The gig economy is the most obvious example of this. A person who works fifty hours a week driving a rideshare vehicle is considered self-employed and, therefore, not entitled to even the most basic employment rights.
Trapped in the Third Way
Rudd is right about one thing: Labor can no longer rely on its historic social base. A genuine alternative would be to rebuild a strong, militant labor movement by unionizing industries that have not previously been well organized. The ALP could combine this with a social-democratic program proposing, for example, to boost inadequate unemployment subsidies and to tackle housing affordability.
However, we are unlikely to see any such program materialize. Rudd’s political outlook reflects his dogmatic faith in capital and tech as forces for good and his conviction that Labor can harness these forces to save Australia. This faith feels like a product of a bygone age.
Rudd’s essay is evidence of the serious dearth of ideas and solutions on the Australian center-left. His generation of Third Way Labor parliamentarians is trapped: unwilling to confront the neoliberal economy that they played a hand in building, and unable to see that their inability to change direction renders them politically indistinguishable from the Liberals they oppose.
(Originally published in Jacobin on 12th June, 2021.)