La comunicación medioambiental en organizaciones del tercer sector

One of the worrying features of the Australian economy that the ALP government identified was the tendency of the Australian system to suffer wage

explosions whenever the level of demand in the economy increased significantly. Such above-average money increases seemed to lead to large surges in inflation and unemployment (Gruen and Grattan 1993:116). Ross Gittins, an economic columnist from the Sydney Morning Herald, recognised this problem - arguing that “every time our economy begins to climb out of recession and build up some steam there seems to be an explosion of wage demands which set the inflation rate off again” (cited in Stilwell 1986: 26).

This trend actually began after the election of the Whitlam government in 1972, and has been associated with the public perception that the Whitlam government was incompetent at economic management. The fundamental criticism of economic policy during the Whitlam years concerned the emergence of a series of “imbalances”, which were responsible for the deteriorating performance of the Australian economy. Amongst these imbalances were increased government deficits, a larger public sector, and higher inflation rates. Outstanding among these was so- called “real wage overhang”: the increase in the share of national income going to wages and the consequent high inflation and decline in the proportion accruing to profits (Gruen and Grattan 1993: 97).

When the Fraser government replaced the Whitlam government it made attempts to solve these difficulties. Prominent among these was the so-called strategy to “fight inflation first”. This involved the use of a wide variety of economic weapons such as restrictive fiscal, and monetary policies, an overvalued exchange rate as an anti-inflationary device, and submissions to the Arbitration Commission advocating real wage reductions. Unfortunately, these policies failed to solve the problems. From 1978 onwards the Fraser government's industrial and wages policies seemed conspicuously fruitless. This period was marked by the collapse of centralised wage fixing, the end of wage indexation and a wages explosion following the 1981-82 federal budget (see Davis 1989: 79).

As a result, when the Hawke government came to office in March 1983, Australia was almost at the bottom of the then worst economic recession for decades.

For the first time since the Great Depression of the 1930s unemployment broke the 10 per cent barrier, and economic activity had declined to a substantially lower level than at any time in the previous two decades (Gruen and Grattan 1993: 98). Inflation was 11 per cent when the Hawke government came to office. Unemployment rose unevenly from 5 per cent in 1975 to 10.3 per cent in mid-March 1983, while employment growth plummeted to minus 2.2 per cent and Gross Domestic Product (GDP) growth rate was also minus 1.0 per cent (see Stilwell 1993: 78). There is no doubt that one of the most important factors which contributed to Fraser’s loss in the 1983 election was this wages explosion, which contributed to a severe bout of domestic stagflation (Kelly 1992: 50).

Thus Fraser, who had exploited the political benefits of Whitlam’s failures, was felled by the same process in the 1983 election. His government had fallen at the same hurdle as the Whitlam government - its inability to hold together Australia's traditional system of centralised wage fixation, its craft union structure and strong demand conditions (Kelly 1992: 51). Like the Whitlam government, the Fraser government misjudged the essence of the economic problems of its time and preferred to concentrate on the symptoms instead of the causes (Kelly 1984: 428). The Fraser government left office having failed to find a method of securing sustained low-inflation growth. It failed to apply an appropriate wages strategy to handle the resources boom expectations which it had created (see Walsh 1991: 36). At times the Fraser government deflated the economy to get inflation down; but when growth took off it was unable to thwart a wage-price spiral.

The experiences of the Whitlam and Fraser governments encouraged the Hawke government to define politics largely in terms of careful economic management. It recognised that political difficulties faced by the Whitlam and Fraser governments were not political problems in their own right, but rather obstacles to the solution of or the impact of economic problems (Pusey 1991: 43-44). Therefore the Hawke government decided that “it would not have to confer a fixed program priority over the requisites of economic management” (Gerritsen 1986: 47). A stimulating article,

written by Gareth Evans in 1986, encapsulates neatly some of the lessons which the Whitlam government provided for the Hawke government. Evans argues that the Whitlam government had to “bear responsibility for the sheer inattention to economic discipline that was evident in the higher reaches of the Cabinet at least until the government’s last few months in office”. “The Whitlam government’s experience” ... “is certainly evidence that it is impossible to govern successfully in a difficult economic climate without a primary pre-occupation with economic management” (Evans 1986: 172).

In contrast to Whitlam, who insisted that economic difficulties were no excuse for avoiding reform, Hawke himself shared Hayden’s (1980: 240) view that sound economic management had become the principal factor in the ALP's electoral strategy and the cornerstone of a successful Labor government. Hawke regarded economic management as paramount (McMullin 1991: 414), and recognised its importance for his political future. Failing to manage the economy properly, he believed, could have terminal consequences for the ALP, as was the case during the Whitlam and Fraser governments (Kelly 1992: 61). He argues “it didn't matter what we achieved in the area of social reform or international relations, the government would live or die according to what it achieved in the economic field” (Hawke cited in National Times 15-20 March 1976). This means, like other political parties, Labor would henceforth have to contest elections primarily on its capacity to manage the economy and solve economic problems (Maddox 1985:223). As a result, almost all areas of policy under the Hawke government were correlated with the idea of promoting sustainable economic growth (Stutchbury 1990: 54).

Unlike the Whitlam government, which did not seem to see the connection between wages and inflation and unemployment, the Hawke government regarded wages control as a essential for sustained economic recovery. The Hawke government saw incomes policies as the best way to solve the economic problems affecting Australia. It believed that income policies could control inflation whilst simultaneously enabling fiscal and monetary policies to encourage the smooth

conduct of economic activity and employment. The argument was that the government would be able to stimulate economic growth through considered fiscal and monetary stances if the trade unions would agree to restrain real wage increases. This would avoid the previous episodes of wages-led inflation. Also, it would ensure that the profit share of national income was boosted. This, in turn, would elevate business investment in new productive capacity and sustain the initial growth kick- start from fiscal policy (Stutchbury 1990: 55). However, since the basic efficacy of an incomes policy requires wage restraint, then it cannot be attained without the voluntary support and co-operation of trade unions. Therefore, the ALP needed an agreement with the ACTU to achieve substance and credibility in the key element of its electoral strategy: its capacity to deliver economic recovery through the medium of an incomes policy (Singleton 1987: 4).