War, austerity, and the cold chill of capitalist crisis

 antiWritten by: (Contributed) on 21 April 2026

 

Two separate statements issued in the past couple of weeks underline the depth of the crisis that bourgeois governments face. The first came from the International Monetary Fund (IMF) and its increased demand for austerity as the world heads toward global recession. The second came from the Australian government and its announcement of increasing military spending.

The Australian government announcement was accompanied by muted calls by Treasurer, Jim Chalmers that, in the face of a looming recession, there might be some ‘assistance’ in the coming budget. He was also seeking to appease the IMF assuring his financial masters that restraint will be the order of the day and cuts will be made where necessary.

The IMF calls for austerity. All capitalist governments have shown a preparedness to cut social spending but all are rapidly pumping more into their respective armed forces. It is entirely illogical, but then any claim to logic that capitalist governments have is, at best, a mystery.

The latest IMF report shows just how close the global economy is to recession. IMF Managing Director, Kristalina Georgieva, indicated that global economic growth will further shrink to a point perilously close to two per cent. Austerity was demanded. This has serious ramifications for the working class, already saddled with rising prices, lowering real wages and now the added pressure from the US war on Iran and the inevitable oil crisis.

The Georgieva call for spending cuts was made in the lead up to the Australian Federal Budget. She made it clear that the Australia should avoid ‘untargeted’ cost-of-living relief spending. Inflation is likely to rise in the coming months and recession is no longer a potential threat but is being spoken of as an almost inevitable consequence of the war against Iran.

Economic growth in Australia is now predicted to slow to just 2 per cent this year and fall to 1.7 per cent in 2027. Treasurer Chalmers continues to downplay these figures. Chalmers has pledged to juggle both the demands of the IMF and the necessity of not cutting too viciously in the budget. A dangerous hire-wire act. The government has indicated it is navigating a ‘narrow path’ to avoid recession while managing a ‘weakened’ economy. We shall all have to wait and see, but there is little room for optimism.

Chalmers, like all Treasurers, does his best to deflect from the crisis that capital lives with. While the war in Iran certainly exacerbates the immediate problems facing global capitalism, the real problems lie in the fragility of the capitalist system itself and the crisis that haunts capital; the tendency for a fall in the global rate of profit.

This crisis drove the capitalist world to globalise. It didn’t resolve the problem. The backlash to economic nationalism and trade war politics has not solved the problem. Things get worse and imperialist war looms as a last throw of the dice to save a sclerotic economic system.

Chalmers said Treasury was still working through the consequences of the conflict for the Australian economy, ‘which are already serious and could become severe.’ Indeed, it could!

Economists knit their brows and wring their hands. The Australian government announced that spending for the military was to skyrocket. There is a madness to all this, but economic downturn, capitalist crisis and the striving for military ascendancy are hardly rational endeavours.

By 2033, fully three per cent of the Australian GDP will go to the military. The ALP government never tires of making proclamations to the effect that a rise in military spending somehow boosts the economy. There is a twisted logic that tries to equate a militarisation of society with economic and industrial policy. This is seen in the boast that the AUKUS outlay of hundreds of billions of dollars will lead to thousands of jobs. This is a ludicrously expensive job creation scheme and especially so when people cannot get decent housing or healthcare. The spending on those quite possibly mythical submarines would effectively resolve all social issues that face Australia and its working class. But no; the new boost in spending can only make things worse.

The ‘new guns before butter’ economic plans will see military spending reach $887 billion dollars by 2035-36. The industrial ‘benefit’ will come from shipbuilding, the manufacture of drones and the technology required to make Australia a worthwhile target in the event of war.

Our economic ‘masters’ have decreed that the private superannuation sector will be tapped in order to find the cash for the new $53 billion military spending just announced. Those same super funds are at least officially used to fund major ‘nation-building’ projects and large-scale expenditures.

The lurch into arms spending and arms manufacture is not a uniquely Australian phenomenon but is a central component of capitalist economies as the very system crumbles before their eyes.

Most recent figures indicate that 50 per cent of all countries are increasing their military spending. Forty per cent of nations are now spending 2 per cent or more of GDP on their respective military budgets.

The extra spending on the military capacities of all countries is a drain on all economies but is good for the business of the war profiteers and the arms traders and manufacturers. The top 100 arms manufacturers have doubled sales in the past two decades. Profits are up. Business is booming. While this has gone on unchecked, the already strained economies of capitalist nation-states become more fragile. Social spending has been slashed, debt has risen and global inflation has been steadily climbing.

Against this backdrop, the IMF, as the banker for global capitalism, stands more than a little exposed. It routinely calls for austerity when governments frame budgets and offers mealy-mouthed calls for restraint when speaking of military expenditure. The best it seems to be able to offer is a declaration that governments need to ‘carefully coordinate’ military spending with monetary policy.

This allows for the Australian government to allow the militarisation of the economy as a direct benefit for the national economy. This is a ‘careful’ coordination indeed. The premise is to spend big, offer lucrative contracts to private capitalist enterprises, sell the materiel overseas in order to make profits while prolonging the suffering of the world’s working class. Central to the thinking of bourgeois governments is the requirement to serve imperialist demands and find a suitable scapegoat to blame for failure of the economy at any given moment.

Capitalism shudders and staggers toward the abyss. As it staggers, it threatens the lives of all on the planet. 

Dancing to death at the end of a rope: Labor’s Budget fails the most vulnerable

 Written by: Nick G. on 10 May 2023

When a person strangling to death on the end of a hangman’s rope is told that, rather than being suspended 3 feet above the floor, they will be lowered to within 2 feet of the floor, it would be somewhat presumptuous to expect gratitude from the victim – or to praise the compassion of the executioner.

But that is exactly how Labor has cruelly taunted the “most vulnerable”, as it self-righteously refers to people in poverty.

It expects to be greeted with applause because it has given JobSeeker recipients an extra $2.86 per day, leaving them still deep in poverty, still gasping for breath on the end of a rope that is said to “leave no-one behind”. At $52 a day, JobSeeker will still be $35 a day ($250 a week) below the Henderson poverty-line

Far above the reality of poverty, Labor keeps alive the disgusting welfare for the rich Stage 3 tax cuts. Living well beyond the reach of poverty, not having to scrimp and save as rents rise, not having to house the family in the car when made homeless, those on an annual income of $200,000 will be gifted an extra $24.66 per day from July 2024. 

Well may we thank Labor for raising the age of children from 8 to 14 for the sole parent Parenting Payment – it was Julia Gillard’s Labor Government that reduced it in the first place.  And why so meanly only restore it to the age of 14 when most young people remain dependent on their parent until the end of the years of compulsory schooling? Would it have hurt to extended it another two years?

The Anti-Poverty Network in SA released a press statement yesterday that perfectly expressed the anger over the Budget: It was headed “We Demanded Bread, We Received Crumbs: Federal Labor’s Pathetic Budget Betrays People In Poverty”.

Labor knows that its so-called “surplus” budget will go straight into deficit in coming years. It has committed to its US masters that it will proceed with the AUKUS expenditure of $368 billion to purchase attack submarines pointed by the US at its imperialist rival, China.

Capitalism is a system in which the greatest imaginable cleavages between classes are produced by the marketplace in which labour power is sold for wages. And for those unable to sell their labour power, the generosity of the rich ensures the most abject poverty, justified by a blame-the-victim mentality kept alive in the monopoly media and the paid opinion-makers, the “influencers” of think tanks and academia.

Capitalism is a system that requires two types of party for its maintenance and administration. One openly works for the rich, the other is kept in reserve because its professed concerns for “all Australians” is a necessary deception when the former starts to stink. 

Both are parties of capitalism. Both are parties which carry out the directives of the US imperialists who dominate the economy and all the agendas that suit their purposes.

We support all actions called to protest against Labor’s “leaving the poor behind” Budget.

Lift JobSeeker and all Centrelink payments above the poverty-line!

Unhappy New Year Jobseekers: Government dumping people in difficulty

 Written by: John G. on 17 January 2021

Above: NSW police talk to people in a queue outside a Centrelink office in Sydney as jobs evaporate. Credit:Nick Moir   SMH

The Government celebrated the end of 2020 by slashing assistance to the unemployed and underemployed.

With these cutbacks and the cuts made in September, they increased the numbers of Australians in poverty by more than a half a million in the middle of the worst economic crisis in decades, if not half a century, according to reliable estimates from The Australia Institute*. Predictably the Prime Minister was nowhere to be seen with the formal announcement of the second slashing of the Jobseeker supplement.

Social Services Minister Ann Ruston Minister mimicked Monty Python’s Holy Grail Black Knight, when she tried to deny the reality, a drop of the supplement by $350, saying to call it “any cut is not correct”. What does she think it is?  In the grand tradition of snake oil sellers she spun it as “continuation of elevated levels of support”. Nasty lying piffle.

The Prime Minister’s and the Minister’s denials cold-heartedly pull the rug from under 10% of the workforce, sending them hurtling towards poverty.

Unemployment peaking, childcare support slashed, mortgage support reduced, Eviction ban lifted
With its September reduction of the jobseeker supplement from $500 to $250 per fortnight, the government shoved 370,000 people right into poverty.

In an act of sheer bastardry, the government handed the unemployed an unhappy New Year with a cut in the supplement again. Another 190,000 people are being hurled into the depths of poverty. The worst impacts will be felt in NSW, Victoria and Queensland, where each state will each see another 50,000 people driven into penury.

No reaching behind to help the beleaguered in our communities to climb above the flood of poverty threatening them, just the Treasury clambering onto their shoulders to prop up the budget while tossing billions at big businesses. 

This government will have achieved a magnificent outcome of dumping 580,000 people into poverty over 4 months as unemployment peaks, they ended free childcare for huge numbers, the economy miles down on activity last year, and job prospects becoming darker by the day after a mild fillip as lockdowns eased. 

Add in reduction in mortgage holidays, eviction bans, removal of bankruptcy protections from small business and the consequent redundancies and closures due to hit in the New Year, and these people have been condemned to very hard times impacting them over the next few months.

Government overcomes fear of unemployed rising
The government has overcome their March 2020 fright when they saw 5 million being thrown out of work, kilometre-long queues snaking away from Centrelink offices across the country, and large numbers of people just one payday away from poverty.

The fright was amplified by Morrison’s scars from his leadership failures in the bushfire period, to an extent limiting how many workers the government could abandon to carry the largest initial burden and hardships of the crisis.

Recognising how many ordinary workers were lining up to experience for the first time the horribly punitive Centrelink systems for themselves, the government quickly shelved their tightwad neo-liberal ideology. They splurged to ease the hardships and divert subsidies of up to 4 million workers to bosses through the Tax Office. Those workers have had virtually no personal dealings with Government at all.

That left about 2 million or so in the hands of Centrelink, and now suffering in the worst of the cutbacks. They are carrying the biggest part of the burden of the crisis, hitting younger, female, and poorly unionised workforces, in particular.

Others, including refugees and visa workers, have been without any government support throughout.

The ‘targetting’ of support to the permanently employed, and partially cushioning the impacts on some of the unemployed, was cynically calculated by government and business as limiting the outrage, and it has. 

Food delivery workers and supporters place demands on Deliveroo. Photo: Worker Student Alliance facebook page

Expanded government supplements to the working class’s income, to an extent, has sustained living standards through a period of Covid-lowered economic activity.

Government: Back to the Business of Business
Wage levels and jobs of the permanently employed were sustained, millions of unemployed were paid higher supports, productive output generally reduced, government supplements to the working class increased. Less of the values produced in society have been left for capitalist accumulation in general. Hundreds of billions in business support payments have shown something of the level of the ‘costs’ to business accumulation the government has been trying to offset.

Now, with further calculation and extensive preparation, government is turning back to the business of business. At its core is setting out for revival of capital accumulation by business through exploitation and slashing diversion through government support for workers and the unemployed. Capitalist accumulation is dependent on minimising wages and focussed now on cutting down government supplements to the working class, as they engage with producing and consuming commodities.

The Working Class: Back to the Business of Standing Up for Itself
The working class confronts difficult circumstances. We never get anywhere by simply pleading or arguing the justice of the case to the tin ears of big businesses.

History is clear. If you don’t fight you lose!

The international capitalist economy is still stumbling along with unresolved problems hanging over from the global financial crisis. Interest rates wallow at levels not experienced in living memory, reflecting excess production and oversupplied markets despite the Covid disruptions to production. Inter-imperialist tensions are rising in the wake of US economic and military dominance ebbing alongside the rise of the Germany-France Axis and China.

Organisation of the working class for the struggles ahead is limited, as is leadership which is prepared and readying the class to stand up for itself. Too many who offer leadership are timeservers, opportunists using the workers to advance themselves, straight out profiteers, and many others looking to ease the workers' burdens, but unable to break from capitalism's restrictions to advance the cause.    

In the throes of the hardships unleashed on January 1 by government, and the huge weight of unemployment and underemployment, people are being roused.

The government paid the working class the great compliment of fearing any mobilisation of workers for themselves in the early days of the Covid crisis. They are right to be wary. There are millions of us and very few of them and their greedy opportunist champions in government, commentariat and treacherous organisations.

The workers and others have mobilised in the Covid crisis and done magnificently providing for, caring for, and protecting our communities. This has been done in the face of Covid and capitalist cries to open society to higher risks of unleashing the virus so they can revive their exploitation in industries suppressed by distancing and other measures.

Nudges to organise and mobilise in action against the heartache of the hardships people are facing and currently experiencing, have not penetrated deeply into the working class, despite moves like the Raise the Rate Campaign of the Australian Council of Social Services, and the less prominent Living Income For Everyone community campaign. Days of Action have mobilised some media and activity at organisational levels, but not engaged the masses. The prospects for mass mobilisations have been heightened with the latest assaults.

Working people and the oppressed shouldn’t pay the price for capitalism’s recovery. The time to lift the fight, to agitate, educate, organise and mobilise in action, is now.  

Slashing support of the Jobless and Underemployed
The government slashed the once $550 supplement up to September down to $150 per fortnight from 1 January for 1.3 million Australians completely out of employment.

The Jobkeeper payment is being cut from $750 a week to September to $600 in October with a whole lot more qualifications, and down to $500 a week as the New Year breaks. That $250 a week cut hits 1.6 million workers. 

They slashed it down to $150 per fortnight, a cut of 70% in the supplement over the last 4 months of the year.

Changes to JobKeeper scheme qualifications saw numbers on it drop from 3.6 million in September to just 1.5 million in October, some with rebounding business as lockdowns eased, others as businesses adjusted to lower commercial activity and dumped staff. The dumped staff are joining the Jobseeker queues. The government is preparing to close Jobkeeper at the end of March.  

References
*The figures used in the Australia Institute research were arrived at by the Australia Institute using the ABS Household Income survey and modelling using the Henderson poverty line developed by the Melbourne Institute, applied differentially to differing household scenarios. By way of example, for a single person the poverty line used was $440.23 a week, for an unemployed couple the poverty line used was $623.58, and where one of the couple was in work, $726.27 per week after tax, including paying for housing out of that. For an unemployed single parent with two children, the level used is $740.95.

See also https://australiainstitute.org.au/post/cutting-jobseeker-would-put-650000-into-poverty-including-120000-children/ 

Grudnoff M (2020) Poverty and a reduced Coronavirus Supplement: If the coronavirus supplement is reduced to $150 per fortnight, 190,000 people will be pushed below the poverty line including 50,000 children, The Australia Institute, 18 November https://www.tai.org.au/

 

 

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Bringing LIFE to life

Written by: Ben H. on 28 July 2020

The Federal government is reverting to its usual instincts to punish and impoverish unemployed and low-income Australians by tapering off the JobSeeker and JobKeeper payments over the next few months. 

Remember that the JobSeeker supplement of $550 a week and the introduction of JobKeeper were not about meeting needs, but about stimulating the economy in the face of full-blown recession (now likely to be a depression of 1930's scale). 

But despite the resurgence of the Covid-19 virus, which is very likely to grow in other states beyond Victoria, the government is not only cutting payments but bringing back punitive dealings with those on income support (so-called “mutual obligation”); allowing eviction moratoriums to end soon without any response; and proposing tax cuts (rich-skewed) and workplace “reform” as the way forward out of the recession/depression. 

This is straight out of the playbook of the Institute of Public Affairs, Business Council of  Australia, Australian Financial Review and the Murdoch press. But reaction meets counter-reaction, and Australian workers are not taking this major attack lying down. 

A new organisation called LIFE (Living Incomes for Everyone) has been building and is now launched, doing what has been rare (and impeded) in Australian politics and society for decades – bringing together those on all kinds of income support with low-income and part-time workers. 

LIFE now has over 70 endorsing organisations, from unions like the United Workers Union and Trades and Labour Councils to groups representing the unemployed, pensioners, people on disability, students and young people, those opposing income management and the basics card, affordable housing, single parents, migrants and solidarity organisations sharing the views and demands of LIFE.

LIFE welcomes individuals from any or no political party, but refuses to accept endorsements from parties. This is to distance it from the toxic swamp of rorts, paid influence peddling and elite-pandering which is modern electoral politics. 

Demands currently centre on the JobSeeker and JobKeeper payments, and raising other income support to the same level (no more divide and rule). 

On Friday July 24, LIFE campaign participating group Anti-Poverty Network SA held a Covid-19 era, lively snap-action outside Human Services Minister Anne Ruston's office after the disgraceful announcement that her Government will cut the incomes of millions of people (see photo above).

See the LIFE Australia Facebook page here: https://www.facebook.com/LifeAustralia

LIFE can be contacted at lifeaustralia@gmail.com 

The independent agenda in practice!

Nick G.

Anti-poverty campaigners in South Australia are winning the support of local government authorities for an increase in the Newstart Allowance.

This is despite the objection of many Councils that the Newstart Allowance is a federal matter and not a proper matter for them to involve themselves with.

The Anti-Poverty Network (SA) is seeking Council support for a $50 a week increase in the Allowance.

Newstart – $269 per week, $160 per week below the poverty-line – is less than 41% of the minimum wage and less than 18% of the average wage. It has not been raised in real terms for 23 years, which is part of the reason why Australia ranks second-worst among developed nations for poverty among the unemployed.

Sky-rocketing energy bills are really hurting the poor. Two families known to a person writing on the APN’s FaceBook page, had a $1000 and $1300 quarterly power bill each. That’s about $100 a week. For a person on $269 to lose $100 leaves $167 a week. Assuming a rent of say $100 (if you’re lucky!) leaves $59 for everything else.

Neither the Labor Party nor the Liberals, both of which have been in office during the 23 years of the real term freeze in the Allowance, have covered themselves in glory. Both administer capitalism on behalf of the real rulers despite lazy newspaper talk about this or that party being “in power”.

The determined action of struggling workers to demand moral support from their local council is an important part of the independent agenda of working class Australians.  They are not waiting for a Labor government to act for them, and they know the Liberals won’t, so they are doing it by and for themselves.

So far, seven Councils have voiced support for the Newstart Allowance to be raised. They are a combination of rural councils (Streaky Bay, Kangaroo Island, Copper Coast and Clare Valley) and metropolitan (Port Adelaide Enfield, City of Onkaparinga, and the City of Playford). In each case, working class activists in each council area have written to and lobbied local councillors, carried out mass work with local residents, and attended Council meetings to advocate their cause.

Bonnie D., a resident of the Onkaparinga Council in Adelaide’s south, told her Council about her circumstances.

“Life on Newstart is a lifestyle of deprivation I wouldn’t wish upon my worst enemy,” she said.   “Whilst I consider myself fortunate to be born and living in Australia where we do have this public safety net available, it has become increasing aware that Newstart has failed to keep up with inflation and the cost of living upon our shores.”

She described how an increase in Newstart would help her. “Well, to start with I would be able to afford to feed myself and my 15 year old son healthier food and more of it.  I often go without as he requires being a competitive swimming athlete a high nutritional meal plan.  He is one of South Australia’s top athletes in his age group and his chosen stroke of Butterfly.  He has represented SA only recently in the National Championships and will be again next year as well.  I am very fortunate to have a family that help support my son in realising his dream to become an Olympian swimmer.  If I didn’t have this support from my family I would be finding a struggle just to send him to swim training once a week.  As the costs for him to train 7 times a week plus gym sessions are completely unattainable for me to provide at this point in time.  That’s one way that poverty affects real life people and families.  It puts road blocks in their path to success especially our most important asset the youth.”

She then described a common feature of life for people on Newstart.

“I recently was facing homelessness as many people do that live upon Newstart.  I have been living in the same small modest house for the last 6 years.   I’d like to point out that paying for my rental house cost me a fortnight over 78% of my available income.  When I received a letter from my real estate agent that my lease would not be renewed as the owners wish to renovate the property.  My little family, of myself my son and my 2 dogs were unable to acquire suitable and affordable housing.  I had the horrible decision to make by separating us all.  My son was to live with my parents along with my pets and I was to couch surf with my friends until such a time I could establish secure housing for us all.  I consider myself lucky that I have wonderful friends and family that I can turn to as a lot of people don’t.  If it wasn’t for them I honestly have no idea what would have occurred.”

Getting Council support has not been easy, and in some cases, difficulties and obstruction have had to be overcome.

A case in point is Salisbury Council which, along with Playford Council covers much of the northern working class suburbs of Adelaide. Residents of both Councils are much affected by the closure of General Motors Holden at Elizabeth. Playford, with 5,700 unemployed residents, for an unemployment rate of 14%, has the highest level of unemployment of any local government in South Australia. However, the City of Salisbury, with 6,300 unemployed people, for an unemployment rate of 9%, twice refused Anti-Poverty Network SA's request to speak at a Council meeting.

“Both times we were told that the issue was ‘outside the Council's jurisdiction’ and therefore not something it could hear about,” said Anti-Poverty Network coordinator Pas Forgione (winner of the 2014 Spirit of Eureka Award for his work in working class areas).

Things came to a dramatic head on the night of Monday 25 September. Over 30 unemployed people and other welfare recipients packed the gallery at Salisbury Council with signs and placards to watch Council pass a motion presented by Councillor Beau Brug (overruling Mayor Gillian Aldridge, who previously refused them their speaking requests), allowing local job-seekers to address the October Salisbury Council meeting.

It was a long, intense and fiery night, with the Mayor filibustering and moving the agenda item to the very end of a four-hour meeting, but the group prevailed and won its right to address the next Council meeting.

Pas Forgione believes that it is poor people fighting poverty that is the reason for the campaign’s success to date.

“The power of the campaign lies in the dedication and courage of local job-seekers, who called, emailed, and met with their mayors and councillors; who willingly shared their stories of financial and personal hardship, and job-searching in a depressed labour market, who fliered, postered, letterboxed and door-knocked; and, critically, who showed up at council meetings in large numbers, often composing over half the audience, to keep their representatives accountable.”

Local government is, in a sense, the closest to the people.  It is important that Councils represent the interests and concerns of their residents, even if their role is pretty much confined to the traditional areas of roads, rates and rubbish.

“Perhaps it a sign of how undemocratic, remote and inaccessible the other two levels of government are perceived to be – and are – their lack of responsiveness to the wishes of ordinary people, the greater extent to which big business dominates the political agenda and the deep bipartisan consensus that exists across so many issues that citizens are turning to councils to be their voice on many important matters,” said Forgione recently.

The Anti-Poverty Network is not confining its activities to winning the support of local government. 

In about two weeks’ time it will host an Attack Poverty, Not The Poor: Anti-Poverty Week Conference, just over two weeks will hold a Trek For Jobs, Justice, And Dignity, a 15km walk from Port Adelaide to the city for jobs, justice and dignity.  The latter draws on the legendary Beef March held by unemployed during the Great Depression.

This is great stuff, and is really putting some meat around the bone of an independent working class agenda. It all has our complete support! 

Morrison’s “Summer Holiday”: no fun times ahead

Nick G.

In the wake of delivering the Mid-Year Economic and Fiscal Outlook (MYEFO) statement, Treasurer Scott Morrison took the unusual step of channelling Cliff Richards singing “Summer Holiday”.

Defending cuts to people’s services and a blow-out in the Budget deficit to $41 billion, Morrison casually likened Government economic policy to taking the kids on a relaxing holiday:

“It’s like going off on that summer holiday: you get in the car; you know where you’re going; you don’t put the passengers at risk; you get to your destination safely. Of course there will be people chiming in from the back seat like my kids always do, saying, ‘Are we there yet? Are we there yet?’ Well, we are going to get there and we’re going to get there with everybody on board.”

So, at some point in time far, far away, the Government will return the Budget to surplus.  In the meantime, sit back and enjoy the ride!

A holiday for the rich, but not for the people

But how can Australians on modest incomes, or the many who are actually poor, enjoy the next four years in which $704 million will be taken back from alleged welfare cheats; $595 cut from health workforce programs; $472 million from aged care; and $441 million from child care?

And then there’s the $639 million cut in subsidies for pathology and diagnostic imaging.

The subsidies were introduced by Labor as an incentive to increase the number of patients bulk-billed for blood tests, radiation therapy, MRI scans and the like – all costly, but essential measures for ensuring the health of the community.

Fraud – political and otherwise

These services are currently provided by private companies. Two of the largest, who dominate the field, are Sonic Healthcare and Primary Health Care. There are probably another ten or so companies operating in this area.

The federal government, probably with some justification, has argued that the subsidies had not really increased the rate of bulk-billing and hinted that pathology companies had instead diverted the subsidies to offset other costs and to boost profit margins. Primary Health Care chief executive Peter Gregg seemed not to bother denying that this may have occurred, saying “The government has a responsibility to run the country, we have a responsibility to look after our shareholders…”

If this diversion of funds has happened then it requires police investigation as a matter of fraud.  Certainly if similar accusations had been made against a union there would have been media-centered police raids, seizure of records, and home arrests of chief executives.

But we are dealing with class justice here, so there has been none of that.

The web of shareholder influence

Indeed, there is a lot at stake for a government that upsets the pathology duopoly. The major shareholders for both companies are the same: JP Morgan Nominees, HSBC Custody Nominees, National Nominees, and Citicorp Nominees.  Just coincidentally, the same nominee companies (holding and managing the share portfolios of private investors) are the four biggest shareholders in the privatised Medibank (though which the rebates are paid to the pathology companies), and in the Big Four Australian banks.

Incestuous? No – monopoly capitalism!

So what is likely to happen while we are taken for a ride by Treasurer Morrison?

Harm and death for the people

According to the Royal College of Pathologists of Australia (RCPA), the cuts are “likely to have a detrimental effect on healthcare delivery in Australia and harm patients”.

RCPA President Dr Michael Harrison added that discouraging people from having blood tests and scans could lead to “delaying the effective early diagnosis of cancer leading to premature deaths; compromising the effective treatment of diabetes and chronic diseases; and threatening the services of rural pathology”.

So here we have a government policy that is likely to harm patients and could lead to premature deaths.  Isn’t “harm” and “death” the threat that comes from Muslim terrorists? Is this the level on which the government wants to operate?

We must put nationalisation on the agenda!

The argument between the pathology providers and the government over the reduction in bulk-billing incentives is simply an argument between crooks and thieves.

At every intersection along the road to summer camp there is a sign off to the left pointing to a different route.  It says “Tax the rich to provide services to the rest”.  Treasurer Morrison, however, is congenitally incapable of turning the car to the left.

As a companion article on this website points out, major corporations both local and multinational, are simply not paying any tax, whilst others are paying well below the official company tax rate (see “The rich and the rest: the ‘taxation transparency’ data”). 

There is no excuse for a couple of private pathology corporations to fraudulently receive taxpayers’ money to “look after” massive corporate shareholding companies instead of looking after the patients who should be their prime responsibility.

They should not be allowed to pass on reductions in these subsidies in the form of patient co-payments and closure of pathology offices in country locations.

The privatisation of Medibank has simply allowed the same massive corporate shareholding companies to bludge off the people and bleed profits from an essential service.

Pathology services and Medibank should be nationalised.

Only a socialised health care service can meet the social objectives of health care delivery.

Nationalise Medibank!

Nationalise pathology services!