Archive for the ‘capitalism’ category

Union Power: The Wings of an Eagle Attached to a Pigeon Head

July 4, 2017

I’ve “excavated” this essay of mine from the deep-end of my archive in view of the Construction Forestry Mines Energy Union’s, CFMEU, threatening decision to publish the names and addresses of building watchdog inspectors with the aim that their “kids will be ashamed of who their parents are.” This union as king-maker, whose power is unparalleled in the industrial history of the country, which can crown and dethrone leaders of the Labor Party, as it did by appointing Bill Shorten as the federal leader of the ALP, has not the slightest concern that by naming the families of these inspectors puts at high risk the safety of their spouses and children. Moreover, its impending amalgamation with another militant union, the Marine Union of Australia, MEU, will make the CFMEU the power-broker extraordinaire. And increase more its forte to continue to break the rules and regulations of the Industrial Court with total impunity. I hope the readers of this blog will find it to be of a bit of an interest.


By Con George-Kotzabasis

The following essay was written on April 2000. It’s republished here on this blog as I think it’s still relevant as unions continue to have a strong grip on the Labor Party. And with a possible impending recession in the US that would inevitably effect the Australian economy, a Rudd victory in the coming election will bring the unions exercising their pernicious behind the times influence on the front benches of a Labor government. And hence exacerbate the peril of the economy of the country in conditions of recession. Lest we forget, it was in the UK in the mid-sixties under Labor governments that ‘trade-union-led “wage push” was the driving force behind inflation and subsequent breakdown of Keynesian policy’. Richard Kahn, one of the closest disciples of Keynes, when he was asked about this breakdown of Keynesian policy, he answered, ‘we never thought the leaders of the trade unions could behave so stupidly’. This stupidity was coined at the time in the term of stagflation, the proud creation of the unions. And this doltishness of the unions is alive and well in our times as it’s still fueled by the false Marxist doctrine of class struggle. This is the danger that trade unions could inflict to the Australian economy under a Rudd government. As for Rudd’s “education revolution” by providing students with laptops, the mountain has brought forth a mouse. Australia is already among the top nations that provides computers to its students. But on the quintessence of education revolution which has to deal with its human capital, i.e., its teachers, who have to be selected on merit and ability and on their teaching methods, two burning issues on which the education unions will not budge, Rudd remains silent. He also claims that his government will be a government of “fresh ideas and new leadership”. But after his lustful embrace of me tooism of some major liberal policies during the electoral campaign, Rudd pellucidly reveals that his government will not be a government of “new leadership” but a government of mimicry. 


The ascendancy of the Labor Party to the treasury benches in Victoria, has churned in its wake a billow of waves of industrial action by an amalgam of union power that threatens to shipwreck the economic vibrancy of the state. The outcome of such fatuous action by the unions will be to induce a flight of investment capital from Victoria to other states, as current and would-be employers of this state would feel too insecure to invest in an environment of industrial turmoil. This is especially so when the Labor government and its leader Steve Bracks are perceived to be irresolute and too weak-kneed to control and rein in this outdated aggression and belligerence of the unions against employers.

The excessive and irrational demands of the unions for a thirty-six hour working week and a 24 percent increase in wages, which if they were successful in obtaining initially in the construction industry and their inevitable flow into some other industries, would have the ineluctable result of throwing thousands of workers among the ranks of the unemployed. This would be a tragic repetition of what happened in the metal industry in the late 80s as a result of excessive union claims, under the then Federal Secretary of the Metal Trades Union, George Campbell—a political stallion of the Left and presently a Labor Senator who is going to be replaced by another stalwart left-winger Doug Cameron who has indisputable credentials of being in the past a real “communist under the bed”—whom the Treasurer Paul Keating accused of having a necklace of 100,000 dismissed metal workers around his neck.

It’s obvious that the unions are afflicted by an innate inability to learn from their past sloppy errors. And like a recurring malady they are bound to contaminate the economy of the country with the calamitous mistakes of the past. The consequences of a repeated mistake, however, are more tragic than the consequences of an initial one and therefore carry a greater responsibility. An action that is performed for the first time is experimental in regard to its consequences, as no one, without the gifts of Tiresias, can predict or foresee whether its results will be benign or malign.  (Not that the unions could be excused for their first error. There was ample evidence of a global scale at the time, and enough forewarnings by eminent economists, that excessive union claims within the confines of global competition would inexorably lead to the flight of capital from regions these claims were impacting upon, and hence to unemployment.) But an action that is repeated deliberately and wantonly in spite of knowledge of its harmful effects in the past is intellectually malevolent and morally culpable.

Whose Culpability is Greater the Union’s or the Government’s

Two questions therefore arise. Is the intelligence of unions commensurate with their powers? Or is it the case that union power is more like the wings of an eagle attached to a pigeon head? If the answer to the second question is affirmative, then one further question is posed, i.e., why then was the political wing of the Labor Party, which is now in government and having the expertise of knowing better about the dire economic effects of industrial unrest to the country nonetheless was unwilling to intervene promptly and decisively to block the irrational and pernicious claims of its industrial wing, which as a government of all Victorians—Premier Brack’s slogan—was committed in doing? Furthermore, why was the government’s immediate reaction to blame the Federal government’s industrial legislation for the ongoing industrial unrest instead of doing something that would have stifled the industrial dispute in its initial stages, for which it had prior knowledge, and using the subterfuge of an excuse that it was constrained by the legislation and could do nothing effective toward its resolution? Both the deputy leader of the government John Twaites and the Minister of Industrial Relations Monica Gould, used this feeble argument, when in fact with the return of the Premier from Davos  the latter forced the union involved in the dispute of the Yallourn power station to return back to work by imposing hefty fines upon its members, hence demonstrating that the government had the power to do something effective to resolve the dispute? Wasn’t it rather, the attempt to shift the blame to the federal legislation, a poor ruse, indeed, a camouflage, to cover its lack of will to intervene timely and decisively and derail the union from its “crashing” course? Yet, the belated action was effective, even if it was done halfheartedly. But what other alternative the government had, at the end of its honeymoon with the electorate, other than to send the stalled fire engines out to extinguish the full blown fire, if it was not to be seen, and impugned, in the electorates eyes, as politically effete and incompetent?

This is a basic characteristic, however, and an irreversible syndrome of Labor governments. To intervene in industrial disputes only when political necessity dictates, i.e., only when these disputes have reached a high point with the potential of harming the economy, and hence would be politically damaging. For organizational and ideological reasons Labor governments are not prone to intervene in the wrangles of their comrade-in-arms with employers, but do so only as a last resort.

This general inaction of Labor governments in industrial disputes is a result first, of a common ideology shared with the unions whose core emanates from the principles of socialism, and secondly, from its constitutional organizational structures that tie the political and industrial wings of the Party into a powerful body and into a compact of consensus that determines the functions of each wing. In conference after conference of the Party, the common and often repeated refrain is that Labor occupies the treasury benches only for the purpose of implementing policies which are discussed and ratified in state and federal conferences in whose conception the unions and its sundry representatives, mainly academics, have a major input. The union’s dominance is illustrated not only in the generation and formation of policies (Its architects generally are academics from the Left, whose intellectual frustration is at a boiling point because their ideas and policies cannot pass muster among other academic luminaries, but who do find a paradisiacal outlet for their “time-stopped” ideas, as well as an adulatory audience among their comrades in the unions, who normally cannot separate the wheat from the chaff of these ideas), but also on the conference floor as sixty percent of its delegates must be union representatives according to the Party’s constitution.

The larger and, especially, the more militant unions have such a firm grip in the election of delegates to Party forums, that even ministers and would-be premiers often cannot be elected to these meetings. Many ministers , therefore, who are unable to be elected to conferences on their own authority, resort to “begging” less militant unions to be placed in their delegations as constitutionally the unions have the authority to do so. Hence only as supplicants to the unions are ministers able to participate in conferences. For example, Jim Kennan, the Attorney General in the Cain Government, for many years was a delegate of the Clothing Trades Union. Likewise too, Steven Bracks, the current premier, was a delegate of the same union, who had taken Kennan’s place with the latter’s departure from politics. Other ministers who are not as fortunate to be union delegates attend conferences as visitors and observers without the right to move, or vote for, resolutions of the conference. Hence, ministers and many of their advisers are left out from the formulation and ratification of the Party’s policies. Such is the power and influence of unions in the organizational procedures of the Party, that often they cal “lock-out” important ministers who are not close to their ideological positions, from the highest policymaking bodies of the Party.

Moreover, the grip of the unions is extended to the pre-selection procedures of the candidates of the Party as well as in the choosing and changes of the parliamentary leadership, both in the state and federal domains. Who can forget for instance the telephone call that Paul Keating made, during his challenge of Bob Hawke, to Wally Curren, secretary of the Meat Workers Union asking him for his support in the coming challenge to Hawke for the leadership of the government? And Curren obliging, by forcing those MP’s from Victoria who owed their position in parliament to his patronage, to vote for Keating? This irritated Bob Hawke so much asking who Wally Curren was pretending thus ironically that he himself who had ousted and replaced Bill Hayden with union support was not cognizant of the influence trade union leaders have in pre-selections. As for the branches of the Party they play a superficial role in the pre-selection of candidates as they too in turn are influenced in their decisions by the organizational power of the unions.

Labor Politicians at the Mercy of Unions

Being therefore at the mercy of unions for their parliamentary positions and for the buttering of their bread, labor politicians, with some exceptions, are cast as toadies of the unions. Only the Federal Executive of the Party can intervene can intervene and save a ministerial or a backbencher’s scalp from the tomahawk of the unions. This occurred when John Halpenny, the Secretary of the Trades Hall Council in Victoria. were placed in the number one position on the senate ticket, with massive union support, in the 1988 federal election, relegating the leader of the Senate, John Button, to the second position. And in the election following the one in 1988, some of the left-wing unions were deliberating whether or not to place Gareth Evans, the Minister of Foreign Affairs, in the second position on the senate ticket. Only some sober heads at the last moment saved the glitterati Minister from the rusty and blood-stained tomahawk of the unions and from posthumous obloquy. (But the power of the Federal Executive is limited, as is illustrated in the present coming election of 2007 in the seat of Coreo, where the current seating member, Gavin O’Connor, is replaced by an assistant secretary of the ACTU (Australian Council of Trade Unions), against the wishes of the Executive.)

It’s for all the above reasons, this congeniality of interests between Labor governments and unions that prevents the former from acting timely and decisively in industrial disputes. And even when they do as a last resort they cannot be impartial in their involvement. The Brack government being captive to the unions has to cater to the latter’s voracious appetite on a number of issues: On the restoration of common law damages for injured workers, which has already being done by passing the relevant legislation in parliament, on the restitution of industrial policy back to the State Government, so the latter can abolish the industrial contracts of the Federal Government, whose aim is to eliminate union dominance in industry negotiations, and to replace them with collective bargaining, hence restoring union coercion and thuggery during negotiations with employers. On these issues and on many others, the Labor government is hamstrung by union power. Whether the former will be able to deliver on these issues will depend on the political climate of the day and on the degree of resonance such a delivery will have upon the electorate.

Steve Brack’s therefore, like a trapeze artist, has to walk on a tight rope whose one end is held by the unions and the other by the community, and perform his balancing act. While gratifying the union claims, with potentially destructive consequences to the economy of the State, at the same time he has to keep its economic robustness, inherited from his liberal predecessor, Jeff Kennet, intact, hence erasing any fears or consternations the community might have about the new industrial course of his government.

It’s with this purpose in mind to win the confidence of Victorians and of some naïve employers that Steve Bracks lately set up a new stage with an old play. His government lacking any originality or lateral thinking in policymaking ransacked the ram shackled spider web storehouse of past Labor policies to bring out the nostrums of “old age”. The summit of “Growing Victoria Together”, chaired by that scion of Labor power, Bob Hawke, was such a nostrum. Imbibing a strong dose of self-deception, Bracks was hopeful that by attracting some old and new celebrities from the industrial club and from business to the summit the public would be hoodwinked and believe that something substantial would come from the coupling of these celebrities. What in fact happened, was that each spokesperson of this divided house of unions and employers, voiced plaintively their complaints and grievances against each other with the result that they were not able to reach an agreement as to how and by what prudent set of actions, they would carry out the growth of Victoria. The rhetorical statement at the end of the summit, spun by the golden threads of the cerebral and literary qualities of Bob Hawke and his wife, respectively, could hardly hide the practical hollowness of the summit. What the latter did was to set up a number of committees to look at a number of issues.  Such as education and training, investment in training, industrial relations, health and wellbeing indicators to measure performance in meeting social goals, infrastructure, the impact of payroll tax on job and wealth creation , and the audit of government services in country communities. It also set up an advisory body to strengthen community input, oblivious of the fact, that while the latter is important it is not a substitute for political leadership. Forgetful also of the fact that the achievement of this laudable “prospectus”, is absolutely dependent on calm industrial relations. And therefore cannot be achieved while the agitated firebrand steam of the unions continues unabated.

Hence, the mountain (the summit) has brought forth a mouse which is at the mercy of the cat’s paws, the unions. Furthermore, as so many of the issues are to be shoved to committees, whose members are deeply divided on the central issue of industrial relations, they are inevitably going to be dealt with in a banal hackneyed manner, since their members will be unable to reach a mutual agreement on the key issue of industrial relations. Hence the summit’s “debris-deliberations” will be proven to be a barren exercise.

The Bracks’ government by its farcical and enervating stand toward the unions and by its populist stand toward the public threatens to throw Victoria into the doldrums as well as empty the coffers of the treasury. This is not a government of substance but a government of images—the images of a dead past. But funeral rites for dead images can be very expensive to the general community, both in terms of tax increases and unemployment.

I rest on my oars: Your turn now

Marxistoid Economists Consider Historically Bankrupt Radical Left Saviour of Greece

June 19, 2017

In view of the ruinous policies of Syriza, and its completely inept negotiations with the European Union, that since its advent into power two and a half years ago is economically, and politically destroying the country, our two economists, Yanis Varoufakis and James Galbraith, who were so vocal is supporting the Marxist party of Syriza, are presently no longer unanimous in their stand toward it. While Varoufakis is a vehement opponent against Syriza and pours profuse vitriol over its leadership, Galbraith, remains totally numb and tuned out. It is for the above reasons that I’m republishing this article that was written four years ago. I hope the readers of this blog will find it of some interest.

Fair is foul, and foul is fair, /Hover through the fog and filthy air (Witches of Macbeth chanting their cursing ditty)

By Con George-Kotzabasis— July 04, 2013

In their article published in the New York Times  on June 23, under the title “Only the Left Can Save Greece”, the two politically ‘pinkish’ economists teaching at the University of Texas at Austin, James Galbraith (the son of the famous John Galbraith) and Yanis Varoufakis, argue that neither America nor Europe should fear an ascension to power of the Left wing party of Syriza in Greece on the contrary, they should applaud it, as a government of the left would reverse the defective policies of the European Union that have been so destructive to the Greek polity and to its people as well as to many other European countries.

The two economists were shocked at the closure of the Hellenic Broadcasting Corporation (ERT) and denounced the Samaras government for its authoritarian and undemocratic action, of depriving Greeks of a public service of information and entertainment that was invaluable to them. The government however closed the public broadcaster temporarily and planned to replace this cesspool of administrative corruption, opacity, and cronyism, for which each Greek household had to pay a levy of 50 Euros per year, with a new public broadcaster not run by the government but by personnel chosen on meritocratic criteria and professionalism that would upgrade the service provided to Greek viewers and at a cheaper price.  Galbraith and Varoufakis, in their support of this corrupt and inefficiently run public entity  and demand of its reopening, found a kindred political ally in the leader of the Marxist party of Syriza, Alexis Tsipras, who had committed himself to re-open with all its personnel intact if he became prime minister. Tsipras’ crocodile tears for the public broadcaster, which in the recent past had condemned as being the mouthpiece of the extreme right, exposed his blatant political opportunism in this U-turn from hate to love for ERT. But they found him also to be an invaluable ally to their economic proposals of how to lift Greece out of the crisis. .

Galbraith’s and Varoufakis’ solution to the crisis springs from the growing of a hundred blooming flowers in the luxuriantly prodigal Keynesian garden. Their package of Keynesian remedies consist of “a kind of European equivalent of America’s post-crisis Troubled Asset Relief program; an investment and job program; and a European initiative to meet the social and human crisis by  strengthening  unemployment insurance, basic pensions, deposit insurance, and the expansion of core public institutions like education and health.” Notice, that all of these remedies are to be financed by  government and taxes from private enterprises. How then government can finance all these things when its coffers are empty and depend on European loans to pay for primal services such as schools, hospitals, and public servants, and when private enterprise has no incentive to function or remain in an unstructured economy that has been for many years inimical to it? And the two economists do not make  a pip about the necessity of private foreign and domestic investments that are the only economically sustainable and viable investments that can initiate growth and economic development that are the sine qua non that will pull Greece out of the crisis. And that these investments can only be made under the incentive  of structural economic reforms that are favorable to private enterprise, and strict fiscal policies that perforce can only be accomplished by hard measures which are inevitably painful to the general populace.

Since neither the political color nor the gray matter of Galbraith and Varoufakis were able to convince serious politicians and economists in the Euro zone, or Greece, of the correctness of their Keynesian mirage as a solvent to the European and Greek crisis, they found in the fiasco leadership of Syriza, of Tsipras, the intellectual salvation of their by now withered flowers of their Keynesian remedy. (This speaks volumes about the value of their proposals in that they found their support and cerebral salvation in the intellectual and moral bankruptcy of the Greek left.) Tsipras bereft of any tenable economic policies, and rationalizing this vacuity in policy making by populist rhetorical denunciations of the policies of the Samaras government, eagerly embraced the policies of Galbraith and Varoufakis, which ideologically are cognate to his own as a ne plus ultra government interventionist himself, thus giving to his own policies some sort of academic prestige from this ‘south of the border’ economists that he is unable to get from more serious experts in the profession. (But beggars cannot choose.)

Indeed, the policies of Tsipras have their source in a variegated coterie of Marxists getting their inspiration from the flashing pan of Marxism, as the rising sun of the latter has long ago disappeared from the astral constellation of the universe, never to rise again. Tsipras, as a true believer of the great man, Karl Marx, attended the Marxist organised Subversive Festival of Zagreb in Croatia last March, which was likewise attended by both Galbraith and Varoufakis. Indeed, the former announced with pride his attendance of the Festival, in a lecture he gave to socialists in the German Parliament last week, where the gladiators of the great imperator Karl Marx had gathered together from all over the world and rushed into the arena of the Amphitheatre of Zagreb, with nets in one hand and swords in the other, to fight and slay the wild animals of capitalism, which their predecessors in the socialist camp, even better armed with technological weapons, had failed to slay. Moreover, Tsipras was an aficionado of Chavez and had visited Venezuela last year with the hope of getting financial help  from its president with an implied commitment of making Greece a protectorate of Venezuela, if not the European Venezuela. And yet Galbraith and Varoufakis in their political naiveté write in their article in the New York Times that the Americans have nothing to fear from a Syriza government.

Galbraith and Varoufakis, like the witches of Macbeth cursing the Samaras’ government as foul, undemocratic and authoritarian, slavishly implementing the dictates of the European Union, and as economically incompetent, are predicting its downfall while stirring the pot of their quackish remedies which nobody will ‘buy’ other than Tsipras. Meanwhile, Samaras wisely, assiduously, and decisively is transforming Greece within the short span of one year by an unprecedented series of structural reforms that are increasing competition–Greece is in the 22 position internationally for the first time–reducing the bureaucracy, especially its inefficient part that was an obstacle to investments, and planning to make it more efficient on meritocratic standards, changing the economic milieu by making it friendly to business and investments, and leashing the arbitrary and ruinous power of unions which for many years had prevented foreign investments in the country. Moreover by his virtuoso performance in the negotiations with the European Union and the IMF, Samaras  has blunted some of the austerity measures that have been a major factor in obstructing the re-igniting of the economy and artfully polishing these measures that will put Greece on the track of development. He was able to convince the leaders of the EU to provide Greece with extra funds for employment programs that will materialize by the beginning of 2014, more resources from the European Bank of Investments so they can be ploughed into small and medium sized businesses. He has started building Autobahns that have created 25,000 new jobs and he has enticed the economically hard thinking Chinese government to invest 350,000 million Euros in the port of Piraeus thus making it the entreport of commerce between south-east Asia and Europe. ( The European Council announced that the port of Piraeus will be named as the capital port of Europe for 2015.) Also the Chinese are interested in making more investments in the infrastructure of the country, especially in its railway network by which they will transport their goods into Europe. But the most important and greatest achievement of the Samaras’ government up to this moment has been the building, through Greece, of the conduit by the Trans Adriatic Pipeline (TAP) that will convey natural gas from Azerbaijan to the heart of Europe. TAP will invest the huge amount of 1.5 billion in Greece and will generate 12,000 jobs by 2014 in the country. This, according to one authority in the energy industry, has been the personal accomplishment of Samaras who in his visit of Azerbaijan and meeting with the Prime Minister of the country three weeks ago, convinced the latter that it would be more efficient and economically cheaper to build the conduit through Greece instead of through Bulgaria and Romania, a project which the international consortium backing it was favorable to win, and lost it only, with the intervention of Samaras. Furthermore, this enormous investment, behind which one of its investors is the global gigantic company BHPBilliton, engenders confidence to other investors that Greece is about to pull itself out of the crisis, and hence, encourages and attracts more investments into the country and thus will increase employment which is one of the major challenges of the government.

The government under the statesmanship of Samaras is determined to pull Greece out of the crisis and not to squander the sacrifices Greeks had to make for the economic, political, and cultural Renaissance of the country. The great, fair achievements of the Samaras government, in an unprecedented short span of time, are depicted and cursed as foul by the two Marxistoid economists, James Galbraith and Yannis Varoufakis. Ignominy, loss of intellectual honor, is of no concern to them.

I rest on my oars:Your turn now 

Will America Rise from its “Comatose” State?

December 5, 2016

In view of Trump’s Victory at The Elections, I’m republishing the following discussion between me and an American for the readers of this blog.  

By Con George-Kotzabasis

A reply to a very clever American Open Salon

The Global Credit Crunch and the Crisis of Legitimacy

By RCMoya612

RCMoya, after your excellent and resplendent analysis I feel, if I captiously quibble about few points, like a bat squeaking in the dark. First, inequality might have “continued its forward march” but I would argue that it did so on a higher level of general economic prosperity in America following the up till now unassailable historical paradigm of capitalism and free markets that has made the poor ‘richer’ in relative terms, as Amartya Sen has contended.

Secondly, America’s “hectoring and ignoring” has its counterpart in Europe and in other continents whose countries were strong allies of the US during the Cold War but with the collapse of the Soviet Union have reappropriated their independence both geopolitically and culturally and expressing this in their own hectoring and ignoring against America, thus continuing the irreversible law of the political and cultural competition of nation-states.

Thirdly, I would argue that as long as America continues to be the centripetal force attracting the “best and the brightest” to its shores and not stifling the Schumpeterian spirit of entrepreneurship and “creative destruction”, it will be able to rise again even from the ashes of a comatose state and will continue to be in the foreseeable future the paramount power in world affairs.

And fourthly, the rejection by Congress of the funding plan that would have a better chance than none to prevent the economy from collapsing was inevitable in the present political climate where reason cannot compete with populist emotionalism and when a swirl of weak politicians, like Nancy Pelosi, and, indeed, Barak Obama, are its ‘slaves’. Only by cleaning out these wimpish politicians from positions of power will the political narrative reassert its legitimacy.

RCMoya says


October 01, 2008 07:26 AM

Thanks for the points. Interesting thoughts.First, I’d be careful in praising the ‘unassailable historical paradigm’ of capitalism and free markets. That has never really been the case elsewhere in world–including Japan and Europe, and definitely not in the third world–and yet that has not stopped those countries from reaping the benefits of a globalised economy. Simply put, capitalism may have been successful–it is–but it is not the case that completely ‘free markets’ have played a central role in the enrichment of advanced economies. That was probably the result of a misleading analysis (an altogether too cheery one at that) of Adam Smith’s ‘invisible hand’–which has monumentally failed more than once since the 1980s.

Second, Europe may have been an American vassal in the early parts of the Cold War–and yet still managed to create economic structures that were different from the United States. Britain, France and Germany have had distinct economic approaches–and that’s to say nothing of more interventionist Scandinavia–and in all of these countries (save for the UK) the post-war years were considered an extraordinary period of growth.You’re probably right that we’re now re-entering a period of political and cultural competition between states. I think this is a good thing, though it’ll take some time for Europeans to get used to the idea of a weaker America.Your third point is probably concedable…though only to a point. The ‘best and the brightest’ only go to America because of its perceived economic vitality. Take that away and there’d be less of a reason to head over. Also, buying into the ‘Americans are so entrepreneurial’ myth is rather problematic–because some European states, for example, have a greater slice of the economic pie coming from small and medium-sized business owners than America, land of the corporate shopper, has. Maybe it’s the contrary situation at present: maybe Europeans have ‘stifled’ entrepreneurialism here…and in any case releasing it would help, not hurt it.

I’d warn that nothing lasts forever, that nothing is ever guaranteed; if America’s financial system DOES go under even further America’s future role as a power would be substantially jeopardised.Your last point starts off well…until you reveal your partisanship. The Democrats certainly don’t have a monopoly on forceful politicking, to their detriment. I would argue that their greatest weakness is in their ‘social democracy light’-style of policies.Yet, all the perceived ‘strength’ in the world hasn’t made the belligerence of the Reagan-Bush-Republican era any more palatable to the world–and, in fact, has in the longer-term probably weakened America considerably.Strength alone cannot substitute for pragmatism, intelligence and good policy.

Kotzabasis says

OK, but you have to answer the intruding historical questions under what economic system Japan and Europe developed and which was the motor of the globalised economy? One would be silly to say that capitalism is an ‘absolute monarch’ and free markets are the ‘Sun King’ of economic development. But we are talking here about basics and not the sometimes necessary state intervention which has been merely, if you allow me to use this metaphor, a changing of an occasional punctured wheel (excepting the present situation) of an omnibus that has been running quite well for a long time on all rough terrains.

And you have to be consistent with your own logic, if you accept the reality of a globalized economy, as you do, which was the offspring of a long gestation starting in the 1980s, how can you imply at the same time that this globalized economy was begotten by the “monumental” failure of the 1980s? The question of Europe is what cemented more the “economic structures” of Europe. Was it the working spirit of capitalism or the working spirit of socialism? And if a mixture of both is your obvious answer, I’ve to remind you that mixtures are not equal and on the scales of economic development capitalism continues to ‘tilt the scales’ in its own favour contra socialism, and that also applied to your economic model in Europe. Perceptions do not have a long life and for more than a hundred years now America continues to attract the best and the brightest on its shores. So its economic vitality must have more solid grounds than perceptions. Again you are inconsistent with your own logic; if the best and the brightest are in America, as you concede, then your “Americans are so entrepreneurial” cannot be a “myth”.

Needless to say “nothing lasts forever and… ever guaranteed” since man’s fate is to live and cope in a world of uncertainty.Lastly, I’m surprised that you consider my judgments on person’s characters, in this case of Pelosi and Obama, and on political parties as being partisan. Under your criterion only a person who made no judgments would be absolutely impartial. The facts are that the Democrats have cut their sails to the populist wind and are running their campaign on the emotional hate and animadversions many Americans have for the Bush administration and by association the Republicans. “Pragmatism, intelligence and good policy are the offspring of strong genes.

Democracy Being a Free Good Endangers its Existence

September 10, 2016

By Con George-Kotzabasis

Breathing democratic freedom is neither easy nor free; it entails both rights and obligations and most importantly knowledge of current fundamental issues. But in most democracies their constituents tend to uphold and demand more their rights than their obligations, and more deplorably, a sizable number of them exercise their rights in a state of ignorance. This imbalance, however, between rights and obligations, as well as lack of knowledge of the real issues, puts in jeopardy the functioning of a politically just and economically productive democracy, and indeed endangers its existence as a form of government.

Moreover, it makes its voters who are uninformed of the points at issue captive to populist slogans and to that everlasting traducer of democracy, identified by Aristotle, demagogy, that appeals to the hopes and fears of the electors and by propagandistic lies and false promises opens the doors of power to demagogues. This is exemplified by two recent political events in our times: Alexis Tsipras and his party of Syriza winning the elections in Greece on a wave of populism and unprecedented lies and false promises in the political history of the country, and of the plebiscite of the UK, whose two leaders of Brexit, Boris Johnson and Nigel Farage, with a farrago of lies and dire fictions were able to hoodwink a major part of the populace to vote for the exit of Britain from the European Union. On a smaller scale this also has happened in the Australian elections, when the Labor Party by its scare campaign that the Liberal Coalition would privatize Medicare, succeeded in convincing a large part of the electorate of this fictitious threat with the result of Liberals losing so many seats that brought the country on the edge of a hang parliament.

How can one remedy the weaknesses of democracy and protect its constituents from becoming victims to populism and to demagogy with catastrophic results to the well-being of society and to its continued economic prosperity? Some people believe that the answer lies in bringing cultural and ethical changes among the people that would make them immune to this toxic virus of populist-demagogy; and thus leading gradually to the cashiering and inexorable dismissal of all demagogic and populist leaders from the domain of politics. The difficulty and danger of such a solution however is that cultural change is a slow process and during its gestation and vicissitudes in a long run may in the meantime unhinge democracy from its door of freedom, by the actions of feckless, inept, and irresponsible politicians, and incarcerate it within the dungeon of dictatorship. A safer and faster solution would be to enact radical changes to the electoral voting system by suspending in certain circumstances temporarily parts of the electorate from voting.

On what principle could one suggest such an unequal voting system that would discriminate so deliberately between social groups in the ambience of democracy, and which group would be the unequal part in the democratic process? The guiding principle of the first part of the question must explicitly aim to the continued viability and stability of a democratic system, in the context of which, the economic well-being of society depends and guarantees the further expansion of wealth that renders to the people a wide choice where to employ their talents and skills that would push their living standard onto higher plateaus and make their lives congenial to their desires. The second part, i.e., the social group that would be unequally treated, would be identified as that part that depends on welfare for its living and as a ‘debtor’ client of the government easily succumbs to populist slogans and rabble rousing; also, due to its low educational level and lack of interest in important matters, it deprives it from having adequate knowledge of the issues involved and hence is completely unqualified to make a sober judgment on these issues. It is mainly this social group that brings to power demagogues and millenarian ideologues that imperil the stability of the polity and its economic system. And, indeed, ironically pits this same social group into absolute poverty, and in turn destabilizes democracy itself, as it has happened with the political rise of Hugo Chavez and Nicolas Maduro in Venezuela; where its people after a contrived false prosperity are presently hunting dogs and cats to feed themselves. The same has happened with the Marxist Alexis Tsipras in Greece, where the pauperization of many of its ordinary people is exacerbated every day and has reached unprecedented high levels under his totally inept, ideologically barren and irresponsible government.

The enactment of this radical legislation would specifically suspend from the right to vote any person who had been on social welfare or unemployed for more than a year, and only with his/her ceasing on being on welfare or unemployed his/her right to vote would be restored. Such legislation would not only strengthen and secure the viability of democracy and the prosperity of its economic system, but would also deprive populist demagogues and political parties of a constituency upon whose existence they depend. Moreover, it would substantially reduce the spending of the welfare state and make it less precarious to the fiscal policy of the state and hence to the well-being of the country. This radical enactment takes a leaf from the cradle of democracy in classical Greece, Athenian democracy. The latter disenfranchised and suspended from voting citizens who had failed to pay a debt to the polis. Likewise, in a modern democracy people who were in debt for their living to the government, that is on welfare, would be suspended from casting a vote.

Needless to say, such a radical proposal, to occur in the ambit of the ‘spoils’ of the welfare state that has spoiled at least two generations of people by our carefree and stand at ease democracy, will not be easy to implement as it will rouse all the wrath and opposition of the ‘progressive’ bien pensants and the ‘good fellows’ of the dole. It will require extraordinarily strong and sagacious political leadership tha will unite parliamentary opposition parties into a gigantic wave that relentlessly will sweep away this ‘progressivist’ praetorian guard of the human rights, without responsibilities, of the dole takers, and throw this defiance of the sanctimonious goody-goodies into the dust bin of history.

I rest on my oars: Your turn now









































turn now






Smart Politicians Stand Naked Before Labor’s Master: Ideological Stupidity

June 29, 2016

By Con George-Kotzabasis June 28, 2016

Since the economically profligate Whitlam era, the only Labor government that was bracketed off from Labor’s inveterate stupidity was the Hawke-Keating government. The present leadership of Shorten-Bowen taking a leftist turn in its politics, like the Rudd-Gillard administrations had done, as adumbrated in its pre-electoral commitments of “big-government,” is repudiating the prudent policies of Hawke-Keating and wilfully adopting, retrogressively, the stupid and disastrous paradigm of European socialism that had sunk Spain, Portugal, Ireland, Greece and Cyprus into the abyss of bankruptcy, economic crisis, and political instability. Moreover, it is doing so in the face when even the Scandinavian haven of the social democratic Welfare state is severely clipped of its largesse, as at last has been realised to be no longer economically viable. Anders Borg, the wunderkind as finance minister of Sweden, initiated the incremental dismantling of the Welfare state, lowered taxes in the private sector, which has galvanized the creation of new jobs.

But returning back home. The leftist political editor of The Sydney Morning Herald, Mark Kenny, is forecasting “dire trouble” for Labor on the debt and deficit front. Terry McCrann, of The Daily Telegraph, ominously declares “Shorten would plunge the country into greater debt”. And Henry Ergas, of The Australian, claims that even the latest backflips of Labor will not be sufficient to close the deficit gap and its “mythmakers” will be tempted “to conjure revenue increases out of thin air, just as the Rudd-Gillard governments did pointing to a golden future time when receipts would soar.”

But to believe in myths and tales of future increases in revenue, when The World Bank and the International Monetary Fund slash hopes of economic growth in the near future, is highly precarious, as it would lead the country into complacency and prevent it from taking the necessary measures to countervail a looming long recession. Furthermore, such a possibility is strengthened with the present event of Brexit, which could ominously beget both the dismemberment and the disintegration of the UK and the European Union, whose widespread ramifications upon the geopolitical and economic spheres of the world would devastate any prospects of economic growth for many years. And it is most unlikely that there will be, like in 2008, another China to save Australia from woeful economic distress.

Further, Labor with egregious lack of imagination and foresight is not factoring-in such imponderables as a precipitous fall in world prices of minerals in a context of world recession and the calamitous consequences that would follow, hitting public finances to smithereens and engendering a seriality of deficits with no hope of being reduced, with the outcome of plunging the country into the abyss of bottomless debt and insolvency. Is Bill Shorten going to be the “Maduro” of Australia, who, as the world price of oil dropped to lower depths, as a socialist president of Venezuela, continued the dissolute economic policies of his predecessor, Chavez, that turned the country from contrived prosperity to real poverty, once the government coffers were emptied, and indeed, into a hunting ground for dogs and cats to feed his people?

It goes without saying, of course, that this is an exaggeration and one could hardly imagine Australians shooting dogs and cats to feed themselves. It is merely used as an example to emphasize the dangers overshadowing an economy, when its Stewarts, the government, insouciantly do not take in consideration future possible events that could dramatically affect the economic course of a country and do not take prospective measures that would shield the country from such catastrophic effects.

One asks the question why the smart as they come politicians of Labor, such as Andrew Leigh, the assistant shadow treasurer of Labor, let their guard down and are reluctant to prepare themselves for these uncertainties of the future, believing that Australia somehow is protected by divine mandate from the ills of world recession and that Australia’s “economy is indestructible”, to quote Rex Connor, a minister in Whitlam’s government? For people who have studied the policies of Labor over a number of years the answer is simple and obvious. All their major policies are motivated by their passionate belief in the socialist utopia. And the implementation of these policies requires, according to this ideological schema, big and interventionist government and hence, high taxes; and the redistribution of wealth and not its greater increase are their priority. Despite the glaring evidence showing that augmenting the size of wealth is the only and sure way to enhance the standard of living of the ordinary people. The latter proposition has indisputable historical precedents, as it was the flourishing and ever increasing wealth of capitalism, that for the first time in history, pulled millions of people from the hovels of poverty onto peaks of prosperity. But Labor is blind before this historical fact. Like a drug addict Labor is fixed to its socialist doctrine and lives in a stupefied world of unreality and wishful thinking.

The matchsticks foundations of socialism are collapsing all over the world, especially in Europe, yet Bill Shorten’s Labor continues adamantly to believe that from this wreckage one could still build the just and equal society as envisaged by Labor’s quixotic visionaries. It is under this standard of socialist ideology that Shorten undermines and repudiates the prudent and pragmatic policies of the Hawke-Keating government, whose “Accord” between employers and workers engendered a congenial milieu for investments and the creation of new jobs with the consequence of increasing the living standard of Australians. Bill Shorten’s silence about these productive structural reforms and fiscal frugality of the Hawke-Keating era that had put Australia on a track of prosperity is a contemptuous affront to the two architects of these reforms. It was therefore rather surprising and amusing to have seen the two conductors of this inimitable political and economic performance sitting on the front-row of Shorten’s Launch of the Labor campaign, clapping at a leader who had mockingly renounced their wise policies. For Paul Keating, especially, standing next to Bill Shorten who had adopted and announced policies that would lead to a “Banana Republic,” it must have been an exceedingly painful occasion. Perhaps as painful as replacing Placedo Domingo with rock-and-roll.

I rest on my oars: You turn now

How the Good Intentions of a Left-Wing Economist Lead to Bad Results

June 14, 2016

By Con George-Kotzabasis May 19, 2016

The following is an unconsummated reply to professor Andrew Leigh’s lecture with the title, “Markets Monopolies and Moguls…” held at Melbourne University, on May 19, 2016. This was due to the chairman’s instruction that only a sprinkle of questions would follow the end of the presentation and there would be no debate

I’m overly distrustful of people who use scarecrows, in this case the “mogul” Richard Pratt, to make their argument. Moreover, it is a term associated with sinister practices and easily tantalizes and incites the feelings of the crowd to purge the evildoers. But more dismally it is wrong in your case, as it is an exercise in a fallacy of composition: Just because there are few rotten apples in the cart it does not mean that all apples are rotten. The unprecedented prosperity of capitalism was not engendered by rottenness but by the creative, innovative, and dynamic spirit of entrepreneurship.

The great economic historian, Fernand Braudel, depicts the shifts of capitalist centres and their entrepreneurial moguls, from Venice, Genoa, Antwerp, Amsterdam, London, to New York, spreading boundless prosperity to these metropolises and their environs by means of the ceaseless division of labour, international trade and the capitalist dynamic ethos of entrepreneurial creation. It was the sun-king of entrepreneurial capitalism that had pulled millions of people out of the sunless caves of poverty into the sunlit vistas of capitalist plenitude, heightening their standard of living, for the first time in history, on ever-higher plateaus.

(The scientific writer, Arthur Koestler, contends that the great discoveries of science were motivated by ambition, competition, and vanity, which happen also to be the inherent characteristics of capitalist moguls.)

You have mentioned a lot of negatives about “bigness” and market concentration but not the fact that they rather have a short life since there is no blockage of entry in a competitive economy to other entrepreneurs into these concentrated areas. One example, the entry of the innovative entrepreneur ALDI into the food-chain services and its reduction of the prices of its products in comparison to other chains, not only attracted many consumers to its stores but also forced the other two major super markets of COLES and WOOLWORTH to reduce their prices at the feel of the competitive pinch of the newcomer. Competition does not discriminate between big and small but it equally affects both.

But to deal with your argument that inequality should be a major consideration in competition policy, and regulating mergers and prices would be beneficial to the consumer. The competitive market in itself, without the need of regulation, spreads its cheaper products to an ever-greater number of consumers and therefore decreases inequality. The competition of Telstra and Optus is an example. The same applies to iPods. Ride a train, a bus, or a tram and you will see even the lower classes fully equipped with these cheaper gadgets of a competitive technology and once again the line of inequality is lowered down for the less wealthy consumer.

It is not the business of government to regulate mergers and pricing. This is the bailiwick of entrepreneurs who decide if such a merger will be profitable, whether it will be able to compete with an already established corporation producing the same product, and setting its price on such a level that it will attract consumers to buy its product en masse. Furthermore, as far as the regulation is close to the estimates and interests of the entrepreneurs it is superfluous; and as far as it is distanced from these estimates and interests, it is destructive. No businessman will invest his money in a venture where profit is unattainable. Hence, your regulation, that aborts the setting-up of a merger that would produce cheaper products for the consumer, by depriving the latter from having these goods, increases the inequality of the mass consumer. Not surprisingly, as often happens, good intentions lead to bad results.

Therefore, your proposal of government dirigisme as a panacea in regards to competition and regulation is inutile, fanciful, and fallacious, and more perniciously may turn out to be a destructive force.

I rest on my oars: Your turn now





Marx and his Reincarnation Continue to be Hotbed of Gross Erata

April 18, 2016

By Con George-Kotzabasis

The following is a very brief reply to professor of economics Kostas Lapavitsas, and former member of Parliament with the Party of Syriza, to his thesis, that Greece can achieve its national sovereignty only by going back to its own currency, i.e., the drachma, delivered at the Ithacan House, Melbourne, on April 15, 2016. The three first paragraphs were omitted from my response as I assumed regrettably wrongly, that the time allotted to the questioners at the meeting would be too short and hence I did not include them.

 Professor Lapavitsas, allow me to make a short comment before I come to my question, as at the start I want to point out what I believe to be the roots of your erroneous proposition.

 Dialectical materialism even in its modern reincarnation of neo-Marxism, which you espouse, is a hotbed of gross errata, not to say terata (monsters), and hence a fallacious doctrine.

Yet the ghost in the machine of Marxism, despite its irreparable breakdown, continues to churn-out apparitional panaceas for the ills of global capitalism. One such quack panacea is your own proposition.

My question is: Show us one country in the world hit by absolute poverty, which, your implied return to the drachma entails, that by adopting your proposal has achieved national sovereignty and kept it; If you cannot show us such a country, then your proposal is a mirage, a will-o’-the-wisp, an occult fancy.

But what is more worrisome is that you are asking the Greek people, after the botched Tsipras-Varoufakis experiment, to be also the guineapigs to your own theoretical experiment which has hardly better odds of success than the Varoufakian one.

National sovereignty is the result of prosperity not of poverty.