So infested with neo-liberalism that they cannot add up anymore

We will start with a quiz question today. Its a very hard question so you will have to think long and hard to get the right answer. If you were the government and had the choice of spending $A114,975 per annum (or $A315 per day) to derive zero benefit and cause significant harm to both society and individuals or spending $A63,074 per annum (or $A173 per day) to derive significant benefit with virtually zero harm being caused which option would you take? While the dollar figures are calibrated for the Australian situation, neo-liberal governments around the world have been able to convince us that the first option is superior. There is no logic to it but reflects the extension of the logic that individuals are responsible for themselves and there is no such thing as a macroeconomic or systemic constraint on individual choice and behaviour. It is that folly that is causing all the strife at present and will ultimately bring the system down.

In August 2012, a report for the Australian National Indigenous Drug and Alcohol Committee of the Australian National Council on Drugs – An economic analysis for Aboriginal and Torres Strait Islander offenders prison vs residential treatment – found that:

The estimated annual average cost per prisoner per day in 2012–13 is $315 … [and that] … The total financial savings associated with diversion to community residential rehabilitation compared with prison are $111,458 per offender.

My latest calculations explained in this blog – Investing in a Job Guarantee – how much? – show that using reasonable assumptions, the total cost of a Job Guarantee job would be $A63,074 per annum (including on-costs, and additional capital costs). On a daily basis that is around $A173 per day, around 54 per cent of the cost of locking the offenders up.

It is clear that there would have to significant help given to the indigenous persons who become incarcerated largely due to alcohol and substance abuse before they could work full-time.

The problem is that governments are not thinking remotely like that.

The reason I raise this issue is that late last week (May 24, 2013), the Australian Institute of Criminology (AIC) released their latest report – Deaths in custody in Australia to 30 June, 2011> – which is a monitoring exercise that originated from the Royal Commission into Aboriginal Deaths in Custody.

For those not familiar with the issue, the – Royal Commission into Aboriginal Deaths in Custody – sat between 1987 and 1991 and was tasked with investigating the “causes of deaths of Aboriginal people while held in State and Territory gaols”.

The Royal Commission was established after “growing public concern that deaths in custody of Aboriginal people were too common and poorly explained”.

Over its exhaustive period of hearings:

The Commission examined all deaths in custody in each State and Territory which occurred between 1 January 1980 and 31 May 1989, and the actions taken in respect of each death. The Commission’s terms of reference enabled it to take account of social, cultural and legal factors which may have had a bearing on the deaths under investigation.

A huge amount of documentary material about the Royal Commission, its hearings and its findings can be found at the National Archives of Australia site – Aboriginal Deaths in Custody: The Royal Commission and its Records, 1987–97.

While the Royal Commission did not find evidence “that the deaths were the product of deliberate violence or brutality by police or prison officers” it did:

… find that, generally, there appeared to be little appreciation of and less dedication to the duty of care owed by custodial authorities and their officers to persons in custody. We found many system defects in relation to care, many failures to exercise proper care and in general a poor standard of care. In some cases the defects and failures were causally related to the deaths, in some cases they were not and in others it was open to debate.

They also found that authorities conducted what they termed to be enquiries into deaths that were “perfunctory and from a narrow focus”, which caused “much harm … to relations between Aboriginal people and the broader community, and great hardship was imposed on the relatives of the deceased persons as a result of the inadequacies of most post-death investigations.”

I cannot cover the depth of the final recommendations of the Royal Commission in any reasonable way in this short blog – the documentation ran over thousands of (very disturbing) pages.

It found that:

… the vast majority of the 99 deaths were of Aboriginal men: 88 compared with 11 women; nearly twice as many deaths occurred in police custody (63) than in prison custody (33), while three deaths were of young people in juvenile detention centres; relatively high numbers occurred in 1987; Western Australia and Queensland had the highest numbers of deaths; and that the dominant causes of death were natural causes or disease (37 deaths) anti hanging (30 deaths).

Was this a disproportionate number?

The Royal Commission found that:

… Aboriginal people in custody do not die at a greater rate than non-Aboriginal people in custody … However, what is overwhelmingly different is the rate at which Aboriginal people come into custody, compared with the rate of the general community. The degree of over-representation in police custody, as measured by the Commission’s study of police cell custody in August 1988, is twenty-nine times …

The conclusions are clear. Aboriginal people die in custody at a rate relative to their proportion of the whole population which is totally unacceptable and which would not be tolerated if it occurred in the non-Aboriginal community. But this occurs not because Aboriginal people in custody are more likely to die than others in custody but because the Aboriginal population is grossly over-represented in custody. Too many Aboriginal people are in custody too often.

There were 339 formal recommendations arising from the Commission spaning 32 pages. You can study them – HERE

Among other factors, the Royal Commission considered the relevance of economic factors to the custody rate.

They said that:

Since the colonisation of Australia, Aboriginal people have been progressively denied access to the means by which they traditionally supported themselves, yet they have not been able to share equitably in the benefits of the contemporary economy which was imposed upon them. Their semi-nomadic hunting and gathering economy has been largely destroyed. Through much of the last 200 years, Aboriginal people were prevented by discrimination and government policy from the opportunities to sell their labour, or to receive equitable wages for their work. Aboriginal people became entitled to receive equal wages in several States only twenty-five years ago, just as contractions in the rural economy extinguished many of the jobs which had previously been their only access to wage employment. Restrictions on their access to the cash economy, restrictions on their places of residence and mobility, and discrimination in employment and education have led to the marginal economic status of Aboriginal people in Australian society today.

… Some Aboriginal people, in particular those resident on outstations, have chosen to adopt a lifestyle which gives priority to social, rather than material, concerns. However, the majority of Aboriginal people in Australia today do seek to share in the mainstream economy, and for many, the opportunities to do so are limited. In recent years Aboriginal people have become increasingly dependant on welfare payments as employment opportunities have declined. By every measure of formal economic status, Aboriginal people today are significantly poorer than any other discrete group in Australian society.

… The poverty which the majority of Aboriginal people experience today is unacceptable both to them and to the Australian community generally. Without ameliorating this poverty, there is little hope that the other social disadvantages which Aboriginal people experience can be overcome.

Statistics provided to the Royal Commission suggested that “80% of the Aboriginal population over 15 years of age in communities were not formally employed”.

I will return to this issue presently.

After the Royal Commission ended, the Australian Institute of Criminology was entrusted “through the National Deaths in Custody Program (NDICP)” with “monitoring the extent and nature of all deaths that have occurred in prison, juvenile justice and police custody”. They have been performing this role “since 1992, with data also collected retrospectively back to 1 January 1980”.

The latest report – the 20th National Deaths in Custody Program Monitoring report – is grim reading.

The Australian Government’s response (May 24, 2013) – 20 Years on – Improvements in death-in-custody rates but more to be done – was typical.

In the opening line we were told by the propaganda machine that:

The Australian Government has welcomed today’s National Deaths in Custody Program Monitoring Report findings that death-in-custody rates have decreased significantly in the past decade.

“Twenty years after the landmark Royal Commission into Aboriginal Deaths in Custody, the rates of deaths in custody for Indigenous and non-Indigenous prisoners, particularly suicides, are some of the lowest recorded,” Attorney-General Mark Dreyfus said.

The Australian Institute of Criminology’s report shows that for 2003-11 most deaths in custody were due to natural causes, with Indigenous people less likely to die in prison (0.16 per 100 in 2010-11) than non-Indigenous people (0.22 per 100).

“Agencies have been vigilant in monitoring and reporting and have taken practical steps, including training officers in how to identify and handle prisoners at risk of self-harm,” Mr Dreyfus said.

“These encouraging findings are the result of efforts across governments, police and prison authorities to address deaths in custody and minimise risk of self-harm, but there is still more to be done

A note of celebration – that is. The joy of it all.

You will note they only talk about the rate. What they didn’t emphasise was the following.

The AIC tell us that:

1. In 2008-09 there were 7 indigenous deaths in prison custody. In 2009-10 this doubled to 14 and in 2010-11 there were 12.

2. Overall, the number of indigenous Australians dying in custody (prison, policy or juvenile justice system) rose frmo 15 in 2008-09 to 21 in 2010-11.

The AIC found that:

Indigenous deaths in prison custody peaked in the mid to late 1990s and declined consistently each year until a 20 year low of just three deaths in 2005–06. Over the last five years, the number of Indigenous deaths has increased again, with the number recorded in 2009–10 being equal to the highest annual total ever recorded (n=14). However, it should be noted that over the last decade, the proportion of the prison population who are Indigenous has increased by six percent (SCRCSP 2012). Taking this increase in the Indigenous prison population into account, the rate of death among Indigenous prisoners has remained at an all-time low.

So while the rate is falling the number is rising and the rate remains low because there is a flood of indigenous Australians being incarcerated.

The following table (taken from Table 5 in the AIC Report) shows the over-representation of indigenous Australians in custody.

So in the Northern Territory, for example, indigenous persons make up 30.3 per cent of the total population but account for 82.3 per cent of the prison population (and 96.9 per cent of the juvenile detention numbers).

Overall, indigenous persons make up 2.5 per cent of the total Australian population but account for 26.1 per cent of the prison population

In future blogs I will analyse these trends in more detail. The problem is that this disproportinately is getting worse.

The Australian Government’s so-called Closing the Gap policy framework, which aims to improve indigenous outcomes is a failure. It is heavy on paternalism and neo-liberal talk about incentives and allows millions to be doled out to out of town consultants who add very little to the pool of creativity.

I have worked in indigenous communities in NSW and at one stage the Federal government was forcing them to develop business plans. The idea is ridiculous in itself given the prior skill development that is required to get to the stage of developing such a plan.

But they were doling out money and there was a group of consultants who went around the Land Councils taking the contracts (which were lucrative) and literally “cutting and pasting” the specific regional and tribal information into their “pro-forma” business plans without any engagement with the local communities nor understanding of the skills base and the cultural attachments etc.

It is also clear that the hardly any of the recommendations of the original Royal Commission have been implemented. Instead, heavy-handed neo-liberalism has been the norm.

The following Table is taken from the ABS Labour Force data and the special annual publication – Labour Force Characteristics of Aboriginal and Torres Strait Islander Australians (Last published July 26, 2012).

The comparison with the aggregate (Total Population) is stunning.

Instead of job creation the Australian government has been obsessed with so-called “Income Management”, which assumes the individual is to blame for their poverty and lack of income discretion.

In 2009, the current Federal Minister for Families, Housing, Community Services and Indigenous Affairs made the following statement when introducing the latest version of the Income Management bill to the Parliament:

Welfare should not be a destination or a way of life. The Government is committed to progressively reforming the welfare system to foster individual responsibility and to provide a platform for people to move up and out of welfare dependence … [need to eliminate] … the entrenched cycle of passive welfare …

[Full Reference: Hon J Macklin MP 2009, Social security and other legislation amendment (Welfare reform and reinstatement of Racial Discrimination Act) Bill 2009, Second Reading Speech]

The focus on the individual as the guilty party – just passively taking welfare and refusing to uplift themselves – is characteristic of the neo-liberal nomenclature. It attempts to steer the focus away from the underlying cause of disadvantage.

A large proportion of those subjected to IM live in remote areas of Northern Australia where there are zero alternative income generating alternatives. That is a systemic failure – a lack of jobs – and the individuals who are victims of that failure because of their geographic location (reflecting history, culture, social considerations, family etc) are no more dependent on income support than they are on the air they breathe.

These are the same communities that feed the prison system in Northern Australia.

There is high unemployment and as a result – widespread poverty in these areas. The pitiful amount of income support that is begrudgingly provided by the Government ensures the recipients remain below the poverty line. IM then imposes Big Brother/Sister onto the daily lives of those that the Government insists will remain in poverty as a result of government policy.

Even the “passive welfare” connotation is loaded given the pernicious activity tests that are imposed on income support recipients.

These include need to search for a certain number of jobs and attend interviews at Government offices every two weeks and satisfy other intrusions (attend interviews, participate in useless training programs etc).

So the culture of IM also completely ignores the fact that not only has the Federal government undermined job creation in Australia via its fiscal austerity obsession but it also has failed to take responsibility for providing work to all Australians and, in particular, continued with the abandonment of the Community Development Employment Projects (CDEP), which for many remote indigenous communities was the only employment available.

For those who would like to see a summary of the political machinations surrounding the CDEP this – CDEP: A timeline of destruction – is useful.

At the time, the decision to scrap the CDEP scheme by the previous Conservative government was described by researchers as just plain dumb.

I recall a discussion I had with a senior federal politician at the time it was scrapped (July 2007) – he said they Government wanted CDEP participants to be forced to move into the private labour market and not be cossetted by artificial government jobs. He, of-course, had an “artificial” yet high-paid government job but that seemed lost on him.

But the substantive point I made is that while I rejected the real/artificial distinction between private and public employment that was at the heart of his policy framework, the reality was something more stark. THERE WAS NO PRIVATE LABOUR MARKET in many of the regions where CDEP provided work. It is one thing to believe in incentives to get workers into the “market” but there has to be a operating “market” to get into.

So now the unemployed in these regions are subjected to IM. There have been a number of in-house Government reports about the need and effectiveness for IM. None have stood the scrutiny of their methodology.

Please read my blog – The unemployed cannot save – for more discussion on this point.

There has to be a change in this approach.

Even on economic grounds – forget all the other reasons – the government spends much more locking up the disadvantaged than they would giving them jobs.

There is a strong causation established between employment and low crime rates.

Unfortunately, our governments are so infested with neo-liberalism that they cannot even do the sums any more.

Conclusion

There is no logic in the decision to create conditions that see a rising incarceration rate among indigenous Australians that cost more per day to house than given them a full-time job in their communities undertaking all sorts of productive activities.

There is also no sense in cutting employment programs in remote communities to force the residents “into the market” when there is no market existing.

But then that is neo-liberalism for you – there is no logic to it that is consistent with being inclusive and providing opportunities for all citizens to do their best no matter their background or proclivity.

It is a nasty, mean-spirited and ultimately, dysfunctional approach to economic policy. It is taking a long time to learn that lesson it seems but eventually it will be learned because as the cancer spreads to the middle class the social revolt will gain traction and then these shonks will be out.

I live in hope.

Meanwhile, the German Finance Minister takes a break from Sudoku

Reuters reported recently (April 25, 2013) – German finance minister hits out at Barroso over austerity remarks – that the German Finance Minister:

… lashed out at European Commission President Jose Manuel Barroso on Thursday, telling lawmakers the euro zone’s woes had nothing to do with strict budget rules and “somebody should tell Barroso that”.

The man is a legend. He is clearly aware of what is going on around him and has a deep understanding of macroeconomics.

Here he is, looking friendly as he takes a break from what I guess is a game of – Sudoku – given his – penchant for playing the game as he attends high level meetings which make decisions that put millions out of work.

That is enough for today!

(c) Copyright 2013 Bill Mitchell. All Rights Reserved.

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    8 Responses to So infested with neo-liberalism that they cannot add up anymore

    1. Neil Wilson says:

      “THERE WAS NO PRIVATE LABOUR MARKET in many of the regions where CDEP provided work.”

      Sounds very much like the problem the Work Programme is having placing people in Hull, UK:

      http://www.guardian.co.uk/society/2013/may/20/work-programme-staff-struggle-jobs

    2. Richard1 says:

      Pedantic, I know, but the $114k figure in the first paragraphdoesn’t tally with the figure in the quote just below.
      Thanks for the blog, interesting.

    3. jrbarch says:

      I don’t know of any better historical site than Eden (SE Coast, AUS.) where the relationship between aboriginals and whites is more clearly and sensitively written (Tasmania was written in blood!).

      It is a story of Trust, between aboriginals and killer whales, appropriated by the whites and desecrated all round. I don’t really know how to express the feeling of trust in the heart of an animal and a human being, but that is what is broken – and that is still the problem today between aboriginals and whites. It needs to be healed FIRST: saying ‘sorry’ meant something to aboriginals, reminding them of their pain; but politicians in general are so disgustingly inhumane and insincere. If they knew even one iota how to be sincere they would LISTEN. And listen some more. First of all aboriginals want their dignity back. Then they need to be able to make a living in ways that suit them; grow and thrive. They are well equipped to survive in a white man’s world and up to the challenge: they survived 50~125 thousand years without us. Three centuries with a broken spirit and suffering poured upon their soul like rancorous suffocating oil did it. Wouldn’t the whites need some help if they were held under for so long? I can just imagine the wailing and crying!

      We are only as sophisticated and enlightened as is reflected in the most needy amongst us. The rest is sheer arrogance!

    4. larry says:

      The man is a legend all right, in his own lunchtime.

      Take people off welfare and then have no job for them to take up. They might as well be dead. Which reminds me of Goldfinger. When asked by Bond if he thought the moving laser was going to make him talk, Goldfinger (Gerd Froebe) replied, “No, Mr Bond. I don’t expect you to talk. I expect you to die.” Change “talk” to “work”. What do they expect will happen to these people? Some have already died as a more or less direct consequence of ATOS, a French company, claiming they were fit to work when their own GP said they weren’t. Their questionnaire, a box ticking exercise, reads as though it was translated by someone not as familiar with English as they ought to have been. One question asks people whether they can sit and stand up at the same time. Anyone who answers yes to this question has lost touch with reality.

      There is a new UK coalition proposal to limit how many times one can see one’s GP. To anyone familiar with the US health care non-delivery system, this is frightening.

    5. stone says:

      I’ve never been to Australia but from what I’ve seen on TV etc, the plight of aboriginals seems an extreme version of a wider issue. On TV there were people in an isolated community who were upset that almost all of their welfare payments went to pay for the huge cost of hiring taxis for the long trip to the only shop. Almost any other community would have bought a beaten up truck and used that to transport goods closer to create a local shop of some sort (perhaps just selling goods from the back of the truck). That would have been the community creating jobs for themselves (or doing it as a gift if that was their inclination). Either way it would have dealt with the issue. There seemed to be an apathy and sense of victim-hood that I worry would also derail any JG program. If people wander off from the JG jobs then what is that going to do? You don’t need a formal business plan to buy a beaten up truck and sell groceries out of the back. If you were to dump several hundred illiterate people from say Bangladesh in the Australian outback and give them welfare payments then they would do that immediately wouldn’t they? You just need to believe that you are in charge of your own life. I’m not sure that a JG helps people to believe that they are in charge of their own lives.
      On another TV program, aboriginals in Western Australia next to a huge mining complex were complaining that they were living in abject poverty. There were lots of jobs there. People were coming in from England to get paid vast amounts as truck drivers. One person from England had set up a truck driving school because people were moving in as would-be truck drivers despite not yet knowing how to drive. It can’t simply be lack of jobs if someone can come in from the other side of the world with no skills and yet learn the skills and get the job right where the unemployed destitute aboriginals have been living all along.
      I equally think it is foolish when workaholic people moan about working 24/7 and never seeing family etc. They also need to make their priorities and be positive about the choice they are making.

    6. Aine says:

      I just re-watched a 2008 SBS Insight program (google:Insight-are they safer) about The Intervention. If you don’t live Australia, SBS is the TV channel that saves Australia from having the world presented as ‘little Australia’. Instead it gently suggests that there might be more to the world than white Anglophone Australian cultural prejudices…except, in this case, if we are talking about Aboriginal people and the Intervention.

      The ostensive purpose of The Intervention was to stop the child sexual abuse which apparently was rampant in remote communities. Problem is if it was, it has not been substantiated in these past 6 years, despite the most stringent controls on how Aboriginal people spent their money. The Intervention quickly became race based income management, which was why re-watching the 2008 Insight was fascinatingly heartbreaking.

      In the program Aboriginal people are dismissed as irrelevant if they recount their historical experience of dispossession as a pertinent feature of how they understand their contemporary experience of being locked out of employment. At the same time the fact that income management to ensure children are fed is being imposed on childless Indigenous people goes by with no remarks passed (Insight).

      How does anyone get together to buy a truck to go to the shop under this level of control, and prejudiced surveillance while battling multiple levels of disadvantage and grieving for losses so profound they can hardly be imagined?

      Oh and by the way, the show features the mad monk telling us that it’s about getting people into work (watch the program).

      What I think he meant was we will make life so bad that people die or leave, conveniently extinguishing native title. That would make it absolutely certain that the tradition land owners get nothing for either their dispossession or the agricultural/mineral wealth of their land

    7. stone says:

      Aine, the whole tragedy seems like it comes about from imposed control. Like you say, if people’s finances are micromanaged they won’t be able to buy a truck or whatever and so won’t be able to sort the situation out themselves. It comes down to a total lack of respect for their capabilities to manage themselves. I guess that total lack of respect can come both from people outside the community BUT also from aboriginal people about themselves. I’m just not sure that a JG isn’t part of the same phenomenon of not trusting and respecting peoples ability to know how best to spend their own time.

    8. Dr Zen says:

      Buy a truck? What with? Have you seen what they pay on the dole here? Please read this post: http://bilbo.economicoutlook.net/blog/?p=22007

      It’s one of Bill’s best.

      Buy a truck? I was on the dole last year. I couldn’t buy a bag of rice after paying my rent.

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