Mysteries of the market
From Moscow to Melbourne, we're told, the capitalist market will work miracles if left to carry out its work without interference. This is despite massive and growing evidence to the contrary.
In Moscow, the market has brought food shortages where previously, for all the many faults of the previous system, no-one faced the threat of starvation. In Melbourne and the rest of Australia, nine years of Labor government policies heavily influenced by economic "rationalism" have ended in the deepest recession in 60 years, with no recovery in sight. Internationally, the situation is no better, with even Japan and Germany beginning to look shaky.
Australia's lowest inflation figures in 28 years, announced on January 29, hold little joy for the 1 million workers unemployed, or indeed for most of the other 7 million still in the workforce. A recent survey by the National Australia Bank reveals that most businesses don't expect an economic recovery in the near future, and many can't foresee any change in the present situation before early 1993. The truth is, any recovery could well take much longer than that, and even then it will be partial. Many economists are predicting high unemployment for the rest of the decade.
While Prime Minister Paul Keating pursues an impossible quest for economic measures that will win him electoral popularity without angering big business, there are no signs of recovery internationally. The US economy is so deeply mired in recession that George Bush has been driven to deep arms cuts in an attempt to free funds for relief measures.
The obvious course for Keating would be to create employment by expanding public works, but any hint of such measures immediately raises an outcry from the economic rationalist geniuses responsible for the current worldwide recession. The truth is, the rationalists have no solution to the present recession except to wait it out. That could take a very long time.
Nothing short of a complete break with the economic quackery of the past decade will begin to relieve the hardship it has caused. The born-again Paul Keating is not likely to do that, so we're going to be stuck with the recession and high unemployment for the foreseeable future. Whatever other mysteries the magical market might hold, there's no question about that.