Of course Wayne Swan thinks there is no ‘budget emergency’. A real budget emergency was the global economic collapse in 2008, which was when he was federal treasurer.
It’s Sunday and there’s a small crowd gathered in the Byron Bay Community Centre to hear the Labor stalwart talk of his life in politics and share anecdotes and views.
It was also the launch of his new book, The Good Fight, a memoir of his time as treasurer with oscillating prime ministers Rudd and Gillard. Who could forget those fun times?
As expected there was much ridicule of the current Abbott government. ‘It’s absurd that this government is out there with this language of “lifters and leaners,” he told the audience. ‘It’s straight out of an Ayn Rand novel. They are lunatics.’
But Wayne’s main narrative centres around the measures implemented to stave off the 2008 global crash: bank deposit guarantees and the stimulus packages, to name a few.
Whatever was done, the measures were successful as it is almost universally acknowledged that Australia was left virtually unscathed while other western countries dipped into recession.
Was he just really, really lucky? While the mining boom could have been mentioned, Swanny reckons it was the first stimulus package that did it. And therein lies his belief in Keynesian economic theory.
‘We went into deficit not because of the stimulus spending but because of revenue write downs,’ he said. ‘You go into deficit, you spend and you restore confidence. Jobs comes back, the economy starts to stabilise and then grow again and that’s the appropriate time to be moving back into surplus.’
Out of all the developed countries in the last 100 years, he said, we have done a better job of matching economic growth with social equity.
‘The attack that came upon us (in government from the Murdoch press and big business) is about dismantling that. It’s about shifting the tax burden from the big corporates onto the average people,’ he said.
‘And in the middle of all that there’s not enough room to spend money on quality education or health care.
‘It’s incredible that we have a government that says it looks to America for its policy inspiration. The Americans are looking at Australia! They are talking about getting a decent minimum wage. They are battling in their congress to get a fair health care system.’
‘There is a big battle going on,’ he says. ’It’s for the soul of the country, and it’s also a battle internationally.
‘Lady Rothschild recently convened an ‘Inclusive Prosperity Conference’ in London and the governor of the Bank of England said that capitalism is currently going through a period where it’s “eating its own”.
‘And the chairman of the IMF says policies for redistribution of wealth are absolutely imperative if capitalism is to be sustainable. And here? the government says “none of that, we need survival of the fittest”.
‘The model that they have in the US and has hollowed out their middle class and produced the most amazing concentration of wealth, which in itself is a drag on its economic future,’ he said.
As for the future about carbon pricing, Wayne says ‘unless it is bipartisan you will never get it through’.
‘All of the big banks and mining companies already had financial arrangements in place for this, they still do actually, so it will be sooner rather than later, because China will go to a fully fledged carbon price or an ETS pretty soon. That will make us look really stupid… it’s a difficult hip pocket issue.’