December 3rd 2016

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Articles from this issue:

COVER STORY Anti-discrimination law validates Safe Schools

CANBERRA OBSERVED Triggs on the way out, but her weapon (18C) must go too

ANALYSIS What is possible to a Trump White House

EDITORIAL Trump portends the start of a new political era

EUTHANASIA Late-night reprieve in SA Parliament

EAST ASIAN AFFAIRS Taiwan and Japan look extinction in the face

SEXUAL POLITICS Victorian Liberals pledge to scrap Safe Schools

LAW AND SOCIETY No-fault divorce a tragedy of nuclear proportions

PARENTING Experts envisage lustrous future for infant graduates

POLITICAL HISTORY Folly with a touch of good sense: Colonel Sibthorp

ECONOMICS Trump as a symptom of the end of neoliberalism

MUSIC Vale Leonard: did we ever really understand you?

CINEMA Fantastical and beastly: Fantastic Beasts and Where to Find Them

BOOK REVIEW A Life well spent

BOOK REVIEW Catholic revisals


FOREIGN AFFAIRS How the left whitewashed Fidel Castro

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Trump as a symptom of the end of neoliberalism

by Colin Teese

News Weekly, December 3, 2016

A few weeks ago I came across an article copied from the British journal, New Statesman. Once upon a time New Statesman was a literate magazine, strongly left wing, in the days when Paul Johnson – a prominent British public intellectual of the time – was still firmly attached to the left.

I’m not a regular reader of New Statesman, but when I have come across it from time to time these days, it seems to be moderation itself.

The article that recently attracted my attention was premised on the assumption that what some call “neoliberalism” is over. It’s been called all sorts of things, including, in Australia, economic rationalism.

Essentially, it is a confection of economics and politics rising out of the Reagan/Thatcher years. In the northern hemisphere it is known more formally as the Washington Consensus. It rests upon the propositions of small government, globalisation, unfettered free markets and privatisation of public utilities. Its original architect, American economist John Williamson, has all but disowned many of its basic ideas; but this did not stop it capturing the minds of most orthodox economists for the last 40 years.

Australia embraced it with enthusiasm from the very beginning.

According to New Statesman’s John Gray, new Conservative Prime Minister Theresa May, spurred on by Brexit, has, like Margaret Thatcher 40 years ago, glimpsed the future. Gray believes her insight heralds the end of neoliberalism.

At the time of his article, I judged that an article on the death of neoliberalism might be a suitable piece for News Weekly. At the time, I had not tied it to the U.S. elections, though I was interested in what was happening in the race for the presidency between Hillary Clinton and Donald Trump.

Trump’s unprecedented “style”

From the beginning of the race for the White House, it was obvious that something strange was taking place, though one could not quite identify what and why. Certainly, Mr Trump was campaigning in an unprecedented way.

It wasn’t so much the allusions to sexual indiscretions – most, if not all, presidents since the 1930s have been similarly tainted. But Mr Trump seemed willing, quite explicitly, to introduce one controversial issue after another – building a wall on the Mexican border one day, excluding Muslims from the United States the next.

Perhaps of greater concern, he seemed prepared to contemplate new directions for the U.S. in foreign and domestic policy; at the heart of his intentions was the idea of looking after Americans, first, last and always.

He wanted jobs lost to American workers to come back. The Chinese had been allowed to take advantage of Americans. That he intended to stop. If necessary, tariffs would be re-imposed on Chinese goods.

He declared war on trade agreements; in his view they weren’t working for the benefit of the U.S. economy and its workers. In Trump’s mind, all was not well inside the U.S. He had ideas for putting things right.

Democrats failed to catch on

The Democrats weren’t thinking this way. It seemed they were taking lower-income workers for granted. Mrs Clinton didn’t try matching Trump on policy, rather preferring to emphasis his unsuitability and inexperience. How wrong she was.

From the beginning, American workers, helpless victims of problems Mrs Clinton chose to ignore, began taking notice of Trump. What’s more, they weren’t bothered about the Republican’s indiscretions, on matters of less concern to them. In fact, Mr Trump’s indiscretions completely blindsided experts on all sides. What they failed to understand was that he was gathering support from those who would normally be in the Democratic camp.

I expected Clinton to win, but I never lost the feeling that there was something to the Trump campaign. The British experience with Brexit was at the back of my mind, and the fact that Trump was talking to the concerns of ordinary Americans. His opponent was not.

Of course the U.S. election was no mere re-run of the British referendum on membership of the European Union, but there were similarities.

The reaction to the U.S. election result here in Australia – apart from stunned silence – was interesting. Immediately the outcome was clear, Prime Minister Malcolm Turnbull was on the phone to Washington asking the incoming President to confirm that the longstanding security arrangements we have with the U.S. would remain. He declared himself satisfied with the President-elect’s response.

Mr Turnbull did, however, concede that his plea to save the Trans-Pacific Partnership trade agreement (TPP) was rebuffed. His response to this setback was worrying.

In what might be deemed an act of defiance he went on to say that he intended to contact current President Barack Obama with a view to having the TPP passed into U.S. law before he passes the presidential reins to Mr Trump in January 2017. Goodness knows what the new President will make of this – all the more so now, some days later, when it appears that the TPP is dead and buried.

Speculation is rife worldwide about what the new President might or might not do. Especially on some of his more controversial domestic policy ideas.

Foreign policy and economics

Meanwhile, more important, broader questions have been completely overlooked. Foreign policy, for a start. And no less important, are we about to see, for example, what appears to be happening in Britain – a fundamental re-assessment of prevailing U.S. political and economic values?

Before I read the New Statesman article I would not have been bold enough even to put the question; but given what is happening in Britain, and following Mr Trump’s election, new forces do seem to be in play.

We know that the British Government is reviewing its attitude to neoliberalism. Without mentioning the word, Prime Minister May has made that clear. But what about the U.S.: is the birthplace of neoliberalism also having second thoughts? Has Mr Trump, like Mrs May in Britain, glimpsed the future and recognised it is not going to be a re-run of the past?

For the moment, I think we can say decisively “no”.

Mrs May, firmly Conservative, has taken her party by the scruff of the neck, and with broad-based, though not universal support, is pushing in a new direction. The Conservative Party seems to accept its leader’s view that the referendum carried a clear message for the Government.

Unlike British Labour’s centre left, the Conservative leader recognises that those at the lower end of the income scale have recorded a justifiable discontent and is resolved to do something about it.

 It would be wrong to conclude that her party, to the man and woman, is 100 per cent behind her. But the doubters have wisely concluded that they will be better off getting behind her than splitting the party.

British Labour split

They have the example of British Labour staring them in the face. Mrs May faces an opposition party divided to the point where it is unable to reach a common position on anything. Extraordinarily, a large number of so-called centre-left British Labour MPs do not accept the leadership of the party’s chosen leader, Jeremy Corbyn.

Mr Corbyn, twice chosen leader by resounding majorities, seems unable to decide how he and his party should react to the referendum outcome, even though it is clear that supporters of his party were overwhelmingly in favour of leaving Europe.

Neither Labour’s leadership, nor those in the party who deny him legitimacy, are able to set a future course for the party. Quite likely Labour will break apart.

No wonder Mrs May is confident.

Mr Trump’s position is entirely different. True, many of the wilder policies he has advanced are out of step with his party’s. And some leading party figures, including former Presidents, made public their intention not to vote for him.

But all that is history. Mr Trump is President-elect on his merits, owing nothing to his own party. And his party owes him plenty. Donald Trump’s personal appeal probably captured the Representatives side of Congress for the Republican Party.

What will he do? We know from his acceptance speech that he wants to spend up big on infrastructure and the military. Spending on infrastructure has universal appeal and is vitally needed. It will also create jobs. Military spending won’t be universally popular, but traditional Republicans will like it. Ditching the TPP won’t please all Republicans, but they will have to wear it.

Trump has also said he wants to reconsider some bilateral trade agreements. If he does want to push ahead with these reconsiderations, there may be less resistance to that idea in his own party than many think.

The U.S. political and economic ground is shifting. The old left and right distinctions are no longer in play. That is clear from the vote away from the Democrats in the Midwest from deeply dissatisfied workers and farmers. They rejected Mrs Clinton in favour of Mr Trump on the basis that he would deal with their concerns.

Mr Trump seems not to be an ideologue, but has identified with socially conservative Republican views. Clearly those who voted for him don’t particularly care about that, but they will expect him to deliver on what he has suggested he can do for them. Especially relating to jobs and working conditions.

The test for Mr Trump and for the Republican Party will be whether, collectively, they are capable of submerging enough of their commitment to orthodox Republican positions to satisfy the needs of the political and economic dynamic that seems to be emerging in the U.S.

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