Have the economic fundamentalists lost their way?

Australians were influenced by Ronald Reagan’s “less tax is beautiful” and Maggie Thatcher’s “there’s no such thing as society”. Australian economic fundamentalism took shape in response to the Keating / Howard calls for competition policy, lower tariffs, deregulation, greater efficiency, less generous more targeted social security, publicly owned asset sales and less government intervention.

Urgent calls are now being made for increased government intervention by a section of society which I had seen as a bastion of private enterprise. Private medical practitioners now want laws rewritten to decrease payouts to those they negligently injure or kill. They are also demanding the Federal Government insures them so they can continue in private practice.

I suppose I should have seen it coming. What with Mitsubishi Motors getting a couple of hundred million dollars for promising to keep manufacturing cars in South Australia and the other $14 billion annual subsidy to industry in Australia it was only a matter of time till the medicos started singing the ole Tom Paxton song – “When they hand a million grand out I’ll be standing with my hand out”.

Clearly certain infelicities of style have shown up in recent times in the private insurance industry, what with HIH, FIA, doctors professional indemnity insurers, some of the superannuation funds, and of course private health insurance requiring a $3 billion annual subsidy from the Federal Government to name just a few.

The circumscribed nature of Australian social policy debates leads us into such conundrums. Doctors’ organisations have convinced several state governments that the problem is that some injured people are receiving huge payouts and that this is what is causing the doctors’ insurers’ fiscal crisis.

The real problem Australia faces is that some Australians who are seriously injured get no compensation. In mid July, the president of the Australian Medical Assocation, Dr Kerryn Phelps, pointing to unjust outcomes following injuries, began a campaign for the introduction of a system of injury compensation similar to that which exists in New Zealand. In Australia some people who are injured can seek compensation whereas others with equally serious injuries can’t. It depends where the injury took place, who caused the injury, whether someone can be found responsible for the event and so forth. In New Zealand no matter whether the injury occurred on the road, at work, on the sporting field or in the home people are assisted to cope with that injury.

I realise that such a government run scheme would mean that the government was taking responsibility for all injured people’s welfare and that this runs counter to the current preoccupation with less government. However, if private medical practitioners now deem it in their interests to have governments protect their interests perhaps it is time for ordinary Australians to rethink whether or not governments should also be protecting the interests of ordinary Australians.

Private medical practitioners are threatening that some of them will stop being doctors and others will stop private practice. Were this to happen then it would be an excellent time to cancel the one third subsidy to private health insurance and to put the $3 billion annual government subsidy into the public health system. This would ensure access to health services was allocated on the basis of medical need rather than the capacity to pay.

The current insurance problems have arisen in the face of the much vaunted claim that private industry is always more efficient than government. It would appear that the HIH collapse questions the veracity of the claim that private ownership beats public ownership every time.

Let us just assume that Australian private medical practitioners were facing their current professional indemnity insurance dilemmas 20 years ago; they would not be pressuring Government to rewrite the injury compensation legislation in a rush. Instead they would have simply pressured the government to get the various state government insurers to provide the professional indemnity cover. Unfortunately governments of various political persuasions have sold their publicly owned insurance companies.

The absence of publicly owned insurance companies has in recent times meant that many civic functions have had to be cancelled because community organisers either could not obtain public liability cover or could not obtain it at an affordable price. Australian society is poorer for the loss of such community activities. Perhaps the time is right to look again at the rhetoric of economic fundamentalists and reassess the appropriate role of government and government instrumentalities in the lives of ordinary Australians. Such a reassessment has been occurring overseas for some time.

Ad Melkert writing about balancing growth and good social services in the Irish Times on the 8th March this year suggested that “After the disillusionment with “big” government in the 1970s, and the frustration and anger over ‘small’ government in the 1980s, citizens realise what they really needed was better government”.

Australian sociologist Michael Pusey has warned that economic fundamentalists have held sway in the corridors of power in this country for the last quarter of a century and they have managed to alter the public’s mind set to a considerable degree. Economic efficiency has driven Australians’ thinking about social as much as commercial issues. This is reflected in the current budget debates about forcing 180,000 disability support pensioners to revert to unemployment payments, the proposed cutbacks in court awarded negligence cases and more generally in the way the Howard Government has approached social security recipients.

Economic efficiency is just one of the factors which should be taken into account when attempting to resolve social problems. Social effectiveness of policy outcomes should be the driving aim of any civilized society.

I think this was published in the Courier Mail