Any country would have suffered from such a terrible earthquake. Even in Australia people would have died; however, it is unlikely that the death toll would have been anywhere near that of 12 January. Many journalists have implied that Haiti had failed to rise up to the challenge of modernity as, for example, their Dominican neighbours had. This argument tends to make us feel better as it reinforces a common underlying racism as to the impossibility of ‘blacks’ ever being able to free themselves from poverty and civil war.

But as many cases around the world have shown, it is not lack of skills, lack of democratic spirit or any absence of a wish for a just society that has led to many third world countries remaining for decades on the brink of extreme poverty. It is not, as French President Nicolas Sarkozy declared in ‘historico-political consideration’ of the ‘African man’, that the Haitians have not ‘entered history enough’, that their ‘mindset does not leave space for human adventure or for the idea of progress’.

Haiti, the Democratic Republic of Congo and other third world countries have strived for real emancipatory freedom, starting with freedom from their colonial past and present. If many have failed, their human skills cannot be blamed. Amazing emancipatory movements and leaders have risen throughout the history of such countries. People such as Toussaint L’Ouverture, Jean-Jacques Dessalines, Mkwame Nkrumah, Patrice Lumumba and, more recently, Jean-Bertrand Aristide have all fought and suffered alongside the poor to bring an end to centuries of exploitation. These democratic movements were not marginal, and despite the bloody repression exercised by dictatorial puppets serving powerful Western interests, a vast majority of people supported them. At times, their struggle seemed almost successful, and none more than the Haitian case.

By the end of the 18th century, Haiti was the world’s most profitable colony, generating revenues higher than the thirteen North American colonies put together. After the French Revolution, Haitian slaves organised a revolt and for over a decade fought the French, the British and Spanish, with tens of thousands of European soldiers losing their lives in battle. In 1804, Haiti became the second independent country in the Americas and the site of the first successful slave revolt of all time. Most importantly, Haiti represented the only complete emancipatory revolution. For the first time, human rights were applied to all, without distinction. This victory was a symbolic blow to white supremacy and it was soon clear that Haiti would pay dearly for such a universal claim of equality. So as not to let Haiti become an example, colonial powers made sure the small war-ravaged country would never be seen for what it truly was: a beacon of freedom for all the oppressed peoples of the earth.

Anticipating further assaults from colonial powers, Haiti devoted most of its resources to the building of fortresses, preventing in turn the reconstruction of the country. The nation was further crippled by economic retaliation; it was not until 1825 that France agreed to acknowledge Haiti’s independence and renew commercial ties, but only once Haiti had agreed to reimburse the French for stolen property. The Haitians had stolen slaves; that is, they had stolen themselves—their freedom had become a mere commodity. The bill came to 150 million francs, roughly the annual budget of France at the time. While France agreed to reduce it to 90 million, the interest on the debt and on the loans contracted in Europe used up most of the Haitian budget until the last repayment in 1947. It has been estimated that today the French owe Haiti up to $US21 billion dollars. In the meantime, Haiti was invaded. In 1915, and for over twenty years, the United States installed a deregulated economy and strengthened the power of the military; publicly, they ‘democratised’ the country. Officially, 99.2 per cent of the Haitian population welcomed the occupation; when the United States left, up to 30,000 Haitians had lost their lives.

After the 1937 exit, Haitian army generals staged a series of coups until François Duvalier (‘Papa Doc’) took power and installed an extremely violent, anti-communist regime with the tacit support of the United States. His son took over in 1971, receiving increasingly fervent support from the United States for his deregulation of the economy. ‘Baby Doc’ became yet another caricature of a puppet dictator, accumulating for his country a massive debt whilst amassing an immense personal fortune. The violence of the new regime eventually provoked its fall as the people rose once more to fight for their freedom. Duvalier was forced into exile in 1986, retiring comfortably to the French Riviera.

As the generals were not able to quash the popular movement, elections were organised in 1990. Jean-Bertrand Aristide, a priest who had dedicated his life to empowering the poor majority, was elected in the first round by 67 per cent of the vote. In a powerful and symbolic action, his government demobilised the army and conducted a series of progressive reforms. However, only seven months into his presidency, Aristide was ousted by former military generals, supported by the elite and partly financed by the CIA. Protests against the coup were quashed and hundreds, if not thousands, of Aristide’s supporters were hunted down and killed. Yet, the people stood with Aristide and even encouraged the US embargo. George Bush Senior showed his support in favour of the coup when he lifted the embargo (allowing important income to flow into the hands of the rebels) and forcibly sent Haitian refugees back to their country. The Clinton administration eventually reinstated Aristide, only at the price of painful and unjust concessions: amongst others, the coup perpetrators were given amnesties and offered key positions in government. Aristide’s reluctance was described by the United States as intractable and rigid: the elected President began to be portrayed as a proto-dictator.

However, it was clear that Aristide’s popularity could not be diminished; in the 2000 elections, judged legitimate by the United Nations, the priest was re-elected by over 90 per cent of the vote. ‘Proper democracy’ was therefore imposed by international bodies. Notably, the IMF imposed drastic deregulatory measures on Haiti. Aristide had no choice but to accept most, as 70 per cent of his country’s operating budget came from international aid. As the result of decades of deregulation, Haiti was no longer self-sufficient in rice and sugar and imported most of these ‘commodities’ from subsidised US farmers. According to Oxfam, Haiti had become ‘one of the most liberal trade regimes in the world’. Aristide did make some headway despite his powerful adversaries and the health and education systems were improved. In 2003, the United States decided to cut their aid to Haiti after the elite declared Aristide to have become too dictatorial. As the President was forced to make further concessions, the ultra-minority opposition demanded more. Their military wings organised violent attacks which eventually led to a UN ‘intervention’ headed by France and the United States. Aristide was ousted for the second time and exiled against his will. The UN declared that Aristide’s withdrawal would help create ‘a peaceful, democratic and locally owned future’.

Just before the 2008 hurricanes and the earthquake, the situation in Haiti was critical. The IMF reported that 55 per cent of the population lived on 44 US cents a day. One in twenty Haitians was HIV positive. Child mortality was four times higher than in Latin America or the rest of the Caribbean and more than a third of the population did not have access to safe drinking water. The media compounded this gloomy vision of Haiti as a failed country. It exploited our deepest neo-colonialist feelings and our darkest sense of white superiority, which makes us the patronising saviours of a doomed third world. Yet, as history has shown, Haitians fought many times over two centuries for a brighter future, not only for themselves, but for all those who were oppressed. They succeeded many times in overcoming the most inhumane conditions imposed upon them by the most powerful in this world. If help is necessary at this stage, what Haiti truly needs is to be free. As important players in this exploitative system, Haiti’s lack of this basic human right is partly our responsibility. To think that our money will bring anything more than temporary (albeit much needed) relief entirely misses the point.

Author bio: Aurélien Mondon is completing a PhD in Political Science at La Trobe University. His research focuses on populism, racism, nationalism and the idea of equality. He is also part of the Melbourne Free University project, which starts in May 2010. For more information visit <www.melbournefreeuniversity.org>.

The House Standing Committee on Family, Community, Housing and Youth’s Inquiry into Homelessness Legislation reported in November that a 17 per cent increase in family homelessness and a 10 per cent increase in adult homelessness between the 2001 and 2006 censuses reflect issues associated with a decline in affordable housing and the private rental market. The definition of homelessness in the Supported Accommodation Assistance Act includes people who are at risk of eviction because their house or flat is too expensive. With 22.5 per cent of Australian households in housing stress (spending more than 30 per cent of their household income on housing and household debt) in 2005–06, and household debt increasing from $795 billion in June 2006 (RBA) to around $1.1 trillion in September 2008 (ABS), it seems that a growing number of people may fall under this definition. The number of Australians at risk of homelessness may number in the millions rather than the official figure of 105,000.

Now the homelessness sector is failing significantly to meet the increasing demand placed on it. The Salvation Army’s Crisis Housing Service says that it is seeing increasing numbers of middle class people who need crisis accommodation. Wesley Homelessness Services says that the Transitional Housing system is so clogged that people must stay in crisis accommodation in motels for months before they can move to transitional housing and there is simply nowhere for many people to go except back to the streets or horrendous boarding houses.

Figures only give us a partial picture. When people fall into homelessness they can approach a homelessness service. If they are a family and the service has funds, they may be placed in a motel. Anyone who saw the confronting Four Corners program ‘Last Chance Motel’ will understand the nightmare this presents for families: living in one room together, unable to cook, to have privacy, nowhere for the kids to play. So to be faced with the prospect of living this way for months at a time is a recipe for despair. This is now the reality for the homeless who are lucky enough to get placed. Wesley Homelessness Services sees 350–400 clients per month, placing twelve in transitional housing in 2009. There is a real problem.

Under the NRAS, the Commonwealth Government has pledged funds to support the development of 3000 dwellings in Victoria. The NRAS offers an annual National Rental Incentive of $6000 per dwelling per year refundable tax offset or payment and the State or Territory Government Incentive of $2000 per dwelling per year in direct or in kind financial support for a period of ten years. Participants include private land developers, real estate agents, non-profit organisations and local government, who will receive these payments in return for supplying dwellings to be rented at least 20 per cent below the market rate to eligible low and moderate income households.

Tenants who are eligible for the Scheme are those who qualify for rent assistance because they receive income support payments or Family Tax Benefit Part A, regardless of their housing affordability situation. The maximum incomes of those eligible range from $39,000 for a single age pensioner to $80,000 for a working family with three children under twelve. The dwellings will be managed by a Tenancy Manager, which would include private landlords and real estate agents. They will be subject to reporting requirements in relation to tenancy selection and management and continuing compliance.

Unfortunately according to the Victorian government Office of Housing these funds would need to be provided for ten consecutive years to clear the public housing waiting list. In Victoria the waiting list grows ever longer, increasing from 34,500 families in 2006 to more 39,000 and somewhere around 200,000 Australia-wide. The inadequacy of the scheme is hidden behind rhetoric which draws on the nation-building of the past—home ownership, the Australian Dream—but the times have changed. Today governments are too much in league with business to ever be able to provide housing as a social need rather than a commodity.

In a speech last year RBA Governor Glenn Stevens explained the way that speculation sets the price of housing rather than need. He argued that rents were rising at a rate higher than the CPI because there was strong demand for rental accommodation, and rents as a yield to the supplier had been unusually low. Earlier in the decade, Stevens explained, housing prices were increasing fast and capital gains returns were good, thus rents remained low. As housing price increases slowed, however, so did capital gains, so investors needed to increase returns. They did this by raising rents quickly. (Just prior to this, the Real Estate Institute and the Property Council of Australia conducted a media campaign ‘predicting’ large rent rises.)

We have a housing system where either rents need to be high or prices need to be increasing for stakeholders (that is developers, real estate agents and investors) to be satisfied, resulting, not surprisingly, in unaffordable housing. By its own logic this system will never deliver sufficient affordable housing for everyone.

Stevens went on to argue that higher interest rates will eventually slow demand, and in due course it will get more difficult to raise prices. This does not seem to have been born out over the last twelve to eighteen months. In the June 2009 quarter, house prices rose 4.2 per cent and, in the September quarter, the housing affordability index dropped 3.3 per cent. The sting in the tail is that higher interest rates mean greater housing stress and increases in homelessness.

The Rudd government’s feted stimulus package with its raft of housing grants for first home buyers and tax concessions has kept housing prices high, according to Professor Julian Disney. Real Estate Institute of Australia president David Airey announced that prices are rising because the number of first home buyers has increased from 15 per cent of all new home loans to 27 per cent, which has led to competition with investors for properties. Speculators, of course, like a bit of healthy competition. It keeps the market ‘buoyant’.

If the purpose of the NRAS is to bring down the price of housing, this will undermine the housing market which is based on attracting investors and developers into the market to make a short-term profit. These stakeholders have an interest in ensuring housing prices remain as high as possible. The paradox is that to attract private investment to build more houses to maintain supply, we need high house prices and high rents. This pushes everyone on a normal income out of the market, and creates more homelessness and housing stress. The only way that housing can be made more affordable is if the government, that is the taxpayer, foots the bill for the profits of developers, real estate agents and investors.

Other criticisms are made of the NRAS which further illustrate the problem of the public–private approach of Rudd’s housing policies. For one, ACOSS has grave concerns that the proposed system of valuations raises the potential for manipulation or inconsistency. There is a high likelihood that real estate agents and speculators will increase their rents on NRAS properties to accommodate the subsidies, thus undermining the purpose of the scheme. ACOSS suggests that market rents should be set by reference to area median rents. But if rents are already inflated and rising as a result of market mechanisms—read speculation—this will do very little. The purpose of the housing market is profit and speculation, not the provision of social services.

Further, the NRAS subsidy will increase annually in line with the rent component of the CPI. Given the expectation of continued rent increases, predicted in January this year as between 5 and 7 per cent by Australian Property Monitors, the level of assistance to developers provided by government increases continuously. The quantity of government money being gobbled up by voracious developers will mushroom out of control.

Another problem with the NRAS is that it will probably not assist as many people out of housing stress as is being claimed. Dr Rachel Ong and Professor Gavin Wood from the Australian Housing and Urban Research Institute (AHURI) have analysed the potential impact of the NRAS. They found that 11,512 households of 50,000 randomly selected eligible households were above the 30 per cent benchmark (30 per cent of household income being spent on housing and household debt). Of these, only 4,614 (40 per cent) would be brought below the 30 per cent benchmark after their rent was reduced by 20 per cent.

This situation worsens when looking at the poorest 20 per cent of households, where rates of housing stress are extremely high at 54 per cent of household income. The NRAS lowers average net housing costs to 34 per cent of income for these households. Barely one in four of the poorest households would be actually lifted out of housing stress. The NRAS is less effective in reducing rates of housing stress because the net housing costs of the poorest 20 per cent of NRAS eligible tenants are more likely to be markedly above the 30 per cent affordability threshold. AHURI has recommended that targeting the NRAS to lower-income households, rather than a random allocation to rent assistance-eligible households, would improve the Scheme’s capacity to alleviate the housing affordability circumstances of a larger number of households. As we have seen with public housing waiting lists, restricting access ends up in a blow-out in demand. As the market fails more people, increasing numbers of people are forced to seek access to the Scheme.

Conveniently, the NRAS could also be a means of cutting government expenditure. AHURI points out that one of the ‘rarely mentioned’ potential policy benefits of the NRAS is that it could create savings in rent assistance expenditure. Rent assistance payment rules could see some reductions in the amount paid to NRAS tenants. AHURI’s modelling estimates that rent assistance payments could be reduced by $21 million or 5 per cent. Unfortunately for the government, these ‘savings are somewhat smaller than might have been anticipated’ because 37 per cent of rent assistance recipients eligible for the NRAS continue to receive the same amount of rent assistance after the rent discount. ACOSS points out that if some tenants are ineligible for rent assistance or receive reduced payments they may be worse off under the NRAS. Again, this suggests that such public–private arrangements really do very little for creating affordable housing for people on low incomes.

Security of tenure remains an issue under the scheme. According to ACOSS, the NRAS does not provide tenants with longer leases or additional rights beyond those required by relevant landlord and tenant legislation. Dwellings occupied by very disadvantaged or high-needs households are more likely to need support to sustain their tenancies. Without that support, even if low-income and high needs households are given priority access to housing, they may be unable to sustain tenancies for extended periods. ACOSS raises doubts about the capacity of real estate agents to operate this type of housing. There is a real danger of these properties becoming hot spots for social problems and for the same people to continue to circulate through the homelessness system. Additionally, there is a genuine risk that, after ten years, private developers will simply sell off the stock and collect the capital gains, returning the housing stock to the open market and making a healthy profit.

A system where profit and speculation fix the supply and value of housing and where the government attempts to regulate this through indirect macroeconomic measures has resulted in housing that fewer and fewer people can afford to buy and rents that leave a large section of the population in housing stress and in danger of homelessness. People treat the housing market as a strange unpredictable beast, struggling to understand or calculate its next move. With increasing interest rates, many are now in danger of getting their heads bitten off. The government’s NRAS will do little to influence this monstrosity. In fact, I suspect, as with most PPPs, the government will simply end up paying out twice as much to private interests and the same people will continue to find themselves circulating through the merry-go-round of the housing system.

But examples like this cannot be taken too seriously in their own right, for there is a distinctly larger picture that demands our attention. Within its terms such failure is only one aspect of an unravelling process focused on the Rudd government. How can this be, after the spellbinding hold of Kevin Rudd over the Australian people for the past two years? No doubt a souring of sentiment caused by the GFC is taking its toll, as it has in the United States and the West more generally. Politics usually loses its gloss when economic boom goes to bust, easy money runs out and people suffer. Rudd’s stimulus packages have been widely supported by the broad community, but a souring note can’t help but creep in. People’s confidence has been undermined; their futures are much less likely to be clear. While things could have been much worse, life has been made more difficult for many and, fair or not, this was not what electors hoped for when Rudd offered change from eleven years of John Howard.

This souring of sentiment has in fact come to permeate the four main planks of Rudd’s campaign success. The demise of WorkChoices has not restored the work conditions people can still remember. The whole environment of work is more stressful and unpredictable for many workers compared to twenty years ago, and WorkChoices symbolised this transformation. It is now clearer to people that WorkChoices was a symptom rather than the cause. The revolution in education has largely been a fizzer and bears no resemblance to the opening up of hope and possibility (however romantic some of that feeling may have been) associated with the expanded educational strategies that began with Bob Menzies and were enhanced by Gough Whitlam. Now a consumer mentality and a managerial meanness towards others sits at the centre of educational institutions, reflected in education being sold as a commodity on the world market. This has set a generalised pattern that has its equivalent in school education and Julia Gillard’s competitive grading of schools. The health revolution has amounted to little. And then there is the central promise of the 2007 campaign: that Rudd would take climate change seriously.

While many people are concerned deeply by the prospect of climate change, they manage that concern to a significant degree by compartmentalising it from other aspects of their lives. Yes, we will have to change the way we live, by using a lot more renewable energy, say, or as per that illusory proposal, by making coal clean. Somehow the change can be made without significant cost to or transformation of how we live. The idea is, the economists tell us, that while there will be a slight fall-off in growth and the standard of living we have experienced in recent years, in the main life will go on as before. This view is widespread among both environmentalists and policy makers. It is also the formula adopted by Rudd and is the framework for his Emissions Trading Scheme (ETS), which seeks to integrate climate change strategy into a further elaboration of the market economy.

If the wheels have dropped off Rudd’s policy agenda, it is more true of climate change than any other policy area. One does not have to take a sceptical position on climate change to acknowledge that the ETS generated a valid fear of unnecessary complexity. If some have turned against Rudd because they are no longer convinced of the validity of scientific claims about climate change, others may have taken a more positive turn that looks to wider possibilities in the long run. The slow realisation that any attempt to address climate change and environmental challenges generally will have deep repercussions for how we live is not a negative outcome. It is a gain. While at the moment there is a degree of uncertainty about where to turn, this hesitation may well become an opening to a more realistic and necessary phase culminating in a more serious practical approach. In the short term, while the collapse of Rudd’s strategy for climate change may deeply trouble many people, whatever else, the simplistic solutions of his initial response have lost their credibility.

While these particular elements of public mood and the reassessment of policy are having a significant effect in unravelling the Rudd political ascendancy, there is also a more profound level of change at work. Why is it that politics is increasingly composed of policies and strategies that seem convincing only for relatively short periods of time, where ‘certainties’ last no longer than a few years? This is not a problem merely for the Rudd government; it also characterised some of the problems faced by John Howard, who suddenly saw the certainties of his political world melt before his eyes.

Politics is often described as the art of the possible. Politicians typically address the social issues and conflicts that confront them and move the electorate, while assuming that the underlying social relations that produce conflicts remain largely unchanged. Political immediacy is hardly a new phenomenon. But the world that attitude takes for granted is now a much more complex and dangerous place, as social conflicts no longer arise out of well-known social patterns. In a recent interview in the New Left Review (no. 61) Eric Hobsbawm commented: ‘Historically, communities and social systems have aimed at stabilisation and reproduction, creating mechanisms to keep at bay disturbing leaps into the unknown … How is it, then, that humans and societies structured to resist dynamic development came to terms with a mode of production whose essence is endless and unpredictable dynamic development?’ In this observation Hobsbawm has in mind the restlessness of capitalism as the root cause of this dynamic. But the truth is that the extraordinary nature of our times arises out of a combination of capitalism and a new social principle that drives the dynamic at a frenzied pace and takes hold not only of the mode of production but also our life-ways.

Behind the ‘permanent revolution’ that life in the contemporary world has become lies the high-tech revolution. The intellectual agents of this revolution have been drawn into the ambit of capitalism and rapid changes to many fundamental aspects of human existence have become a fait accompli. Supported by the media on the one hand, including the increasingly popular possibility of living via the internet, and developments in techno-production, the post-human calls to us. We change the balance of our lives by putting aside the substantial presence of others in favour of abstract associations. While resistance to change is still a deep reality, it is nevertheless muted, as people are drawn into processes that place fleeting mobility at the centre of their lives. And this composes that restless reference point of contemporary politics.

These are the processes that provide much of the backdrop and material for the populism of a John Howard to exploit. Populist politics is made possible when broader social changes disturb people, threaten their jobs, alter their sense of selfhood, and are constantly mutating into new social conflicts that may or may not be manageable for the politicians of the day. So the very same society that made it possible for John Howard to exploit a fear of ‘border crossers’ and terrorists supplied Kevin Rudd with the electoral lever of climate change, which helped bring Howard down. The society that gave support to Kevin Rudd in this goal continues at the same time to pursue consumption and growth—of economy and population—with such vigour that climate change and environmental catastrophe more generally seem unavoidable. It may be possible to ride this unpredictable monster in the short term through superficial policy adjustments, but the shelf life of any government is likely to be short.

Every challenger believes they can perform differently. Now Tony Abbott is staking his claim and there are some signs that the electorate is ready to grab even that possibility, at least for the moment. But all such choices avoid coming to terms with the fundamental question of our time. What is to be done about the emergence of a high-tech capitalism that never ceases to provide evidence that such a society is unsustainable?

Sure, the departure of Howard had left the Liberal Party bereft of a leader who, unlike Turnbull, could listen to his backbenchers and still take the strong stance, aggressively welding his team together (the success of his wedge politics creating a cast of near-acolytes). But what might have seemed some kind of rudderless chaos for a while after the election was only the beginning of a much larger fracturing. Turnbull has gone down not merely exposing the cracks but forcing the ugly duckling out through them and into the bright light of day.

As the immediate politics of the situation played out, there were in fact few choices. Even though Joe Hockey’s idea of repackaging climate change policy as a matter of conscience seemed to fit the political mood—faith-based policy, policy on the basis of belief, not ‘rationality’ or pragmatism—it was a sign of policy weakness, as well as possibly meaning defeat for the conservative push. With the dandyish Kevin Andrews having warmed up the audience, the ‘hairy-chested’ Howard-man-man Abbott was the true heir apparent. Addicted to getting their way, impassioned about the role of markets yet hunkering down round some notion of a base culture that would provide the ‘values’ by which to live, galvanised, still, around a border politics fuelled by and fuelling fear, the conservatives recognised their man and best bet for market differentiation vis-a-vis Rudd’s moderated neo-liberalism.

Around half the parliamentary Liberal Party now looks to Abbott to aggressively pursue their climate change scepticism, a stance taken seriously nowhere in the world except the fundamentalist Bible Belt of the United States and Australia. What the other half of the Liberal Party will do is not clear. Playing politics around such a basic division, winning the numbers just either side of a fifty-fifty split on ‘matters of belief’ seems impossible for a party needing to set stable policy directions. One can’t see the party being purged of its conservatives by its liberals: the latter aren’t as good at the politics as the party Right; they were, after all, seduced by Howard, losing any moral high ground they might have occupied, and they may no longer have any ‘pull’ in the community anyway around any residual Deakinite individualism which some might wish to resuscitate. Howard and the neo-liberal market effectively trashed that tradition, but also, the electorate may be unable to understand the difference implied by this image of the true liberal or be unlikely to take it seriously as either ethical or very different from the on-the-ground individualism offered by Rudd. Whatever the liberal critique of corporatist forms of government and their suppression of strong individual moralities, which has to be given some credence in history, the guiding concern in the outlook of all the major political currents remains the individual’s relation to the market, and in the present context most people live that as the power they feel when they make an individual consumer choice.

George Monbiot is pretty effectively arguing in the Copenhagen context that the political world will split in future between the ‘restrainers’ and the ‘enlargers’; another death knell for left and right social and terminological divisions hailing from the 19th century. But the question goes also to an understanding of the individual and the nature of the social: why restrain? On what basis might we restrain? What benefits and pleasures might ‘restraining’ bring? It is not ‘just’ a question of possibly saving the planet, but of how and why our ‘humanity’ requires whatever it is the notion ‘restraint’ might be straining to signify. Is it really just ‘restraint’ that we should be aiming for? Certainly its justification should not be mere survival, nor should it signify mere sustainability. Let’s hope it doesn’t suggest a social technology to make us behave better environmentally. Let’s hope, rather, that it involves a better knowledge of ourselves qua human beings: a better knowledge of the relation we need to constitute vis-a-vis the natural world and ‘others’ of all kinds if we are to remain within the bounds of what we define as necessary to our humanity. Unfortunately, ‘restraint’ remains within the orbit of a market-dominated paradigm—where what we must give up is what we might otherwise want, or be called to want. The point is to get to that place where not only do we not want it, but it is no longer a question because a fullness of living and being emanates from elsewhere.

This is to move way too quickly beyond the woes of the Liberal Party, but the enormous gulf represented even in these few paragraphs on the politics of reaction, on the one hand, and a possible opening to something very new, on the other, only underlines the moment we have arrived at. As the small island nations are making clear at Copenhagen, as the demonstrators led by Mary Robinson have been impressing, as the science has been making clear for a long time, fundamental choices are at stake. The Liberals’ conniptions, and ultimately reactionary choice of leader and orientation, point to the significant dangers that accompany periods of social threat, even when the lineaments of change have been evident for decades; even when it has been pointed out many times that it is neo-liberalism and the market under post modern conditions that have sown the seeds of destruction of the very social practices their loudest proponents wish to protect.

Eric Hobsbawn, in Age of Extremes, describes a fundamental shift that took place between the first and second world wars. While the First World War was the first modern war—total and technologised—it was as if no one really understood the powers that fed it. Leaders, and the people, still believed that an end to war would mean a return to what had been before. At war’s end the relative peace of the previous near century, remarkable prosperity and relatively settled social arrangements were what people harked back to; world war was an aberration, never to happen again. Yet radical cultural change had been filtering into pre-consciousness through the prescient art movements of the late 19th and early 20th centuries, just as science and industry were merging in novel ways in the first flowering of the techno-scientific paradigm (the successes of industrial chemistry and the German laboratory system). The period harked back to during the war had already been in flux. Abstract society, predicated upon a new sense of ungroundedness and a culture much less restrained by natural limits, had been felt, sometimes celebrated, certainly artistically and scientifically explored, just as fantasies of stability and rational achievement seemed to promise a return, rather than allow that the conditions of existence had actually shifted under the feet of the classes, bourgeois and working alike.

It would take another twenty years after the First World War, twenty years of preparation for war, worldwide depression, and war against Nazi reaction, for a shift in perspective facing towards the future rather than the past. For Hobsbawn, this ‘post-war consensus’ around Keynesian economics and the welfare state (broadly understood), seems to have been a period of realignment, of system catch-up, so that a more thorough, and perhaps more self-conscious modernity might emerge cognisant of the profound changes not only wrought by war but by the social and technological forces that had shaped it.

Of course, that consensus was exactly what neo-liberalism rose up against later in the century, just as the second surge of techno-scientific success supercharged the economy and produced unheard of material prosperity both in the West and beyond. We also know now that the forces and politics of material abundance, and more recently decadence, depended on environmental conditions and resources that make the ‘necessity’ of modernity and its heirs (‘necessity’ as understood in all the varieties of modernist Progress-based social theory, including Marxism) highly questionable. Taken to the brink by the latest techno-scientific surge, carried in the subject form of the hyper-individuated consumer, on the one hand, and the networked agent, on the other, the world is in fact in a very different circumstance than that described by Hobsbawn as the thirty year 20th-century war period. The need to face up to the conditions both of our humanity and a future no longer dependent on the rape of the earth presents a far greater challenge. But just as Hobsbawn outlines, with considerable delicacy, the commitments and hopes of the different groupings influential at that time, we face a period of system mismatch and cultural misunderstanding, of disorientation as the forces in play work their way through social life, and the possibility of grasping their meaning remains, as always, difficult—only to be realised within a protracted process of transformation.

There are two basic ways of framing a resolution of relationships between Indigenous and non-Indigenous Australians. I will call them the ‘sacramental’ and the ‘pietistic’. In religious talk, sacramental paths to spiritual grace require a collective and ceremonial act. Pietistic ones are those of the individual in quiet communion with the divine.
Pietists stress a one-to-one relationship with the deity, unmediated by priestcraft or the collective witnessing of a symbolic sacrifice. Pietism is in some ways much more at home in an age of individualism than in ages of greater corporatism and communalism. The sacramental-sacrificial approach represents the reverse. It also goes back deep into Old World prehistory, to a time when animals and humans, not symbols, were sacrificed in human rituals.

That is about it, except for a few passing comments that do not add to this basic description. For Sutton, ‘sacramental’ is really a code for government-sponsored public programs paid for out of tax dollars, endless reports and posturing by politicians, all of which have failed dismally. In the second quotation above he has deviously added ‘sacrificial’, which is another category altogether and largely left alone. By contrast, ‘pietism’ acts as a catchword for private and personal ways of working in the world, outside the programs that seem to have failed. Why choose the terms sacramental and pietistic when collective and individual would have done perfectly well? Are they merely camouflage for criticisms of social democratic approaches and a championing of liberalism? Why do his criticisms of collective, government-sponsored projects sound like commentary by Miranda Devine or Andrew Bolt? Is not the ideology of the individual one of the worse aspects of colonialism itself? And what is the role of theology in debates over reconciliation?

In what follows I will try to answer these questions, although in the end I argue that Sutton has confused matters. What really is at issue is at best obscures by these terms: agency. Sacramentalism acts as a cover for one-directional agency, coming from the non-Indigenous and directed towards Indigenous people. By contrast, pietism conceals a pattern of mutual agency, consultation and joint decision-making. Yet Sutton has unwittingly raised another issue: the implicitly theological nature of many of the key ideas used in debates over reconciliation. Before I get to those matters, a few words on sacramentalism and pietism are in order.

Sacramentalism
First, the evil term: sacramentalism, which is a deeply Roman Catholic term. As one might expect in theology, fine distinctions bedevil any simple overview. But some patience is needed, since Sutton uses the term loosely, so much so that he badly misrepresents theology and confuses his own analysis (and his readers). Sutton claims that sacramentalism is collective and ceremonial, sacrificial and pre-historic.

He is mostly mistaken, for the word actually has two senses, neither of which suits his purpose. First, the word may refer to a ‘sacrament’, such as baptism or communion. The problem is that—strange as it may sound—the church has nothing to do with the effectiveness of a sacrament. Technically, a sacrament works through the act itself (ex opera operato). God transfers grace through the act and does not rely on any person, institution, state of mind or whatever. The act is sufficient; it is an objective act on God’s part. It is a little like the story of the Danish physicist, Niels Bohr, and the horseshoe. Bohr lay ill out on his farm; a friend called and noticed the horseshoe above the door to his room. ‘I thought you didn’t believe horseshoes made you well’, said the friend. Bohr replied, ‘I’m told it works even if you don’t believe in it’. Clearly Sutton does not mean this sense of sacramentalism, since that would mean the objective, disinterested act of, say, adequate healthcare, an apology or a treaty, would be enough. Out of the four ways Sutton describes sacramentalism—ceremonial, collective, sacrificial and pre-historical. Is the sacrament ceremonial? Yes. Is it collective, sacrificial and pre-historic? No.

Perhaps Sutton means the ‘sacramentals’ (to be distinguished from the ‘sacrament’). These are acts that convey God’s grace only through the intercession of the church (ex opere operantis ecclesiae). What kind of acts? Grace at meals, a blessing, a ring at marriage, a simply act of kindness and so on. There is no definitive list, for a sacramental is the process through which human activities are made holy, mediated by the church. Now we have a collective dimension, since a sacramental relies on the church. But it is not necessarily ceremonial (it may be, but is not necessarily so), sacrificial or pre-historic.

So the theological terms don’t actually fit Sutton’s definition of ‘sacramentalism’. Or rather, they have a partial fit, depending upon what element one chooses. What is really going on with Sutton’s use of the term? I would suggest that sacramentalism for Sutton is quite bad camouflage for social-democratic, hand-wringing, lefty approaches to Indigenous and non-Indigenous reconciliation. But then he includes in this collective mix state-sponsored programs, reports and legislation. All of which comes under the umbrella of a theological term that is less than useful.

Two final observations: Sutton plays into an old Protestant polemic with his use of sacramentalism, for the word is usually connected with Roman Catholic theology. A strange move this, since it harks back to the major issue of religious conflict in Australia back in the 1950s and earlier, namely the Protestant–Roman Catholic divide. Riots, debates, political allegiances, mutual suspicions, bans on marrying across the divide—these were part of the social and religious scenery at the time. It is hardly useful to resort to those differences once again.

Further, a pernicious subtext also appears with Sutton’s description of sacramentalism as sacrificial and pre-historic. He hints that it is pre-Christian, but there is a dangerous slippage to an image of Indigenous life before Europeans arrived. Does he want to suggest that before the arrival of Christianity and its theological terms, Indigenous people too were prehistoric, given to animal and human sacrifice? On the surface, of course not, but beneath the text the hint is there.

Pietism
The favoured term is pietism, which Sutton describes as a one-to-one relation with God, one undertaken by an individual in quiet communion, more suited to an age of individualism (our own?). No mediators here, no priests or church or state, just individuals doing the best they can. For Sutton this is the way forward for reconciliation, although he does need to replace God with another human being. All that is needed is a ‘personal moral adjustment’ (p. 203) to interpersonal and collaborative reconciliation between two persons. Sutton uses the examples of individual acts of private reconciliation, in which people get on in their day-to-day lives, and in which the non-Indigenous person becomes a vocal critic of racist state policies: Lancelot Threlkeld and Biraban in the 1820s–1840s, Ursula McConnel and Billy Mammus in the 1920–1930s, and Lloyd Warner and Mahkarolla in the 1920s.

Is pietism up to task? At one level it is. Pietism has a distinct history with complex threads, but it is clearly a very Germanic, Protestant (especially Lutheran) and relatively recent development dating from the late 17th century. Its central concern was a life of deep religious commitment, rooted in inner experience and manifested in outward acts or the ‘practice of piety’.

So far, so good, at least for Sutton’s purposes. The catch is that pietism was ultimately a collective movement with strong political overtones. It sought to revive the church from within rather than break away from it. Indeed, the main stream of pietism was warmly welcomed by pastors and theologians in the German Lutheran Church in the 18th and 19th centuries and quickly became seen as a way to renew religious life. It soon spread to other parts of the world whether Lutheran Protestantism was strong, especially Scandinavia, Greenland and North America.

For Sutton’s argument pietism is useful in some senses but not in others. Inner experience, the place of God in one’s heart, lives lived in quiet faithfulness, and the impetus for individual philanthropic activity—all these elements work quite well for Sutton’s purposes. But he ignores the other elements of pietism, such as the collective and institutional nature of mainstream pietism, its desire for reform within the institution and its tendency towards conservatism.

Once again, I suggest that Sutton’s dip into theology is less useful than he might think. Pietism doesn’t simply mean individual relations, for it is also a deeply collective theological practice. In this respect, the word becomes in Sutton’s hands a cover for the sort of liberalism championed by Friedrich von Hayek and Milton Friedman, or their lesser followers in Australia like Andrew Bolt or Miranda Devine. Individual enterprise is the key, not collective approaches (which become totalitarian) or state intervention (the evil of ‘big government’).

Agency and Theology
Sutton’s use of the opposition between sacramentalism and pietism is in the end a caricature. By picking certain features and making them definitions of the whole, he has distorted both traditions, using them as poor camouflage for state-sponsored and individual solutions. However, I suggest that what lies behind Sutton’s argument is really the issue of agency. With sacramentalism he seems to mean agency from one quarter and moving in one direction: from non-Indigenous governments to Indigenous people. The former decides what is appropriate, depending more on the vagaries of electoral cycles, ideological positions, the power of lobby groups, and individual political careers. And then it acts, assuming it can fix all the problems with the latest program—the NT Intervention is the obvious recent example of this one-sided approach.

However, by pietism Sutton is pointing towards mutual agency, one that involves two or more people (I would add groups) who realise their own needs, shortcomings and limits, but above all the need to come to an understanding of one another and the need to act on that understanding. It takes little imagination to determine which approach is more desirable. The catch is that Sutton seems to think that this process is primarily an individual one, an argument that is ideological (in the bad sense) and hardly progressive.

My final question picks up another issue: the theological tenor of the reconciliation debate as a whole. Of course, a good of discussion has taken place on these matters within the progressive wings of the Christian churches, where debates and resolutions concerning reconciliation have been cast in explicitly theological senses. However Sutton, as a leading anthropologist, has done what the churches have not been able to do, since they so often remain closed circles: somewhat unwittingly, he has brought out and made public the underlying theological nature of the debate by invoking explicitly theological terms, even if he misses the mark in the specific terms he has chosen. In short, I would suggest that much of the terminology and mindset of reconciliation uses what may be called secularised theological ideas. Emptied of their theological content and refilled with political and social content, they still trail many theological assumptions behind them. For example, reconciliation itself is one such term (between God and human beings), as is the idea of guilt (collective or individual—an issue in the Howard years), and even covenant or treaty.

However, before we rush in to claim theological ideas for resolving the relations of Indigenous and non-Indigenous people, we need to investigate those terms carefully, especially since Christian theology came with European invasion, embodied in the person of Samuel Marsden who filled the role in the early colony of both clergyman and judge. The problem is that all of these key terms assume an unequal relationship, God on the one side and human beings on the other. Guilt is what one feels towards God for having disobeyed and sinned; reconciliation is for human beings alone, since we need to be reconciled to God; a covenant is made between unequal partners, one more powerful and the other less so. This imbalance often carries through to the secular uses of such terms.

So I would suggest that in the current debates we would do well to investigate the implicit theological assumptions of the key terms. Who is the more powerful one in the process of negotiating a treaty? Who is the guilty party? The NT Intervention shifts the guilt squarely onto Indigenous people, who then need to be ‘punished’ for their ‘sins’. But then those who oppose the intervention argue for the guilt of the colonisers, who then need to make amends. And is it possible to produce a process of reconciliation that either recognises the thereby seeks to negate the imbalance of power, or is it possible to come up with a reconciliation that removes such imbalance?

Apart from taking voyages by ship and cycling as far and as often as he can, Roland Boer is a writer and a critic based at the University of Newcastle. His intellectual background is in theology, political philosophy and Marxism and he is finishing a five volume series called The Criticism of Heaven and Earth (Brill and Haymarket).

Over the past year, I’ve been visiting communities in the Pacific islands, to ask people about their concerns on climate change and to find out what they’re doing to respond to the adverse effects of global warming.  From renewable energy initiatives and community-based vulnerability training to advocacy at international meetings, islanders are actively engaged in responding to the climate emergency.  But the enormity of the environmental impacts already locked into the ecosystem means that some people are debating whether they’ll need to leave their homelands.

You can’t help but focus on the human impacts when visiting low-lying islands in the Pacific.  The potential hazards are obvious on atolls like South Tarawa in Kiribati, a narrow strip of land 40 kilometres long but only 50–100 metres wide.With land areas just metres above sea-level, there is no retreat to higher ground from the ravages of storm surges and more intense cyclones.  Facing salt water inundation of agricultural land and fresh water supplies, these threats to coastal villages tend to concentrate the mind about the powers of the elements.  For low-lying atoll nations in Polynesia and Micronesia, the potential failure of the Copenhagen negotiations and delays in the reduction of greenhouse gas emissions will lead to forced displacement.  However, the current intergovernmental Pacific Islands Framework for Action on Climate Change (PIFACC), developed by the Forum member countries, makes no mention of displacement or migration.

In spite of this, some Pacific island governments like Kiribati, Tokelau and Niue are openly discussing issues of relocation and resettlement due to climate change.  In July 2007, a joint statement from Pacific environment ministers to the Forum Economic Ministers Meeting (FEMM) noted: ‘The potential for some Pacific islands to become uninhabitable due to climate change is a very real one.  Consequently some in our region have raised the issue of their citizens becoming environment refugees … Potential evacuation of island populations raises grave concerns over sovereign rights as well as the unthinkable possibility of entire cultures being damaged or obliterated’.

In August 2009, the outgoing chair of the Pacific Islands Forum, Premier of Niue Toke Talagi, says it may be time for the regional organisation to formally consider the issue of resettlement of people affected by climate change.  Speaking at the official opening of the 2009 Forum leaders meeting in Cairns, Talagi stated, ‘While all of us are affected,the situation for small island states is quite worrisome.  For them, choices such as resettlement must be considered seriously and I wonder whether the Forum is ready to commence formal discussion on the matter’.  Across the Pacific, there are a number of examples where people from low lying islands are considering relocation after being affected by extreme weather events, tectonic land shifts or climactic change that damages food security and water supply.

The case of the Carteret Islands in Bougainville is well known, where Ursula Rakova and the local NGO Tulele Peisa are assisting families to resettle on church-donated land on the main island of Buka.  There are similar problems looming in other outlying atoll communities, such as the Duke of York atolls (a number of small low-lying islands in St.George’s Channel near Rabaul in Papua New Guinea) or the Mortlock Islands in Chuuk State, Federated States of Micronesia.  In the Solomon Islands, tectonic plate movement and sea-level rise may lead to the displacement of people in outlying atolls like Ongtong Java (Lord Howe) or artificial islands like Walande in Malaita Province.

But what will resettlement involve? To hear about the experience of people who’ve already been forced from their homes, I visited the islands of Western Province in the Solomon Islands, which were hit by a tsunami in April 2007.  More than two years after the tsunami, many people on the main island of Gizo are reluctant to return coastal villages, and are still living in improvised housing up in the hills and mountain ridges.  At Titiana, one of the coastal villages on Gizo that bore the brunt of the tsunami, you can see the damage to community infrastructure.  Villager Orau Mote shows us where the school, church and pastor’s house were swept away—all that remains is a pile of concrete and steel rods.  Children in Titiana have been using large tents as their school rooms, provided by UNICEF and the Ministry of Education.  Titiana’s United Church pastor Motu Tarakabu told me that many residents are still traumatised by the disaster.  ‘Only about 20 per cent of residents have come back to the village after the destruction of the tsunami.  Many others have decided to stay away and remain up in the hills—they have fear in their heart.  People are still strong that they won’t come back to the village.’

Driving up the mountain ridges, you meet people from the coast who are refusing to resettle in their former homes and are building new houses to replace the tents and tarpaulins supplied after the disaster.  Some villagers are rebuilding on land provided by clan relatives, but many are squatting on government land alongside roads and logging tracks.  Orau Mote explains that a number of people of Micronesian heritage were relocated from the Gilbert  Islands to the British Solomon Islands Protectorate during the era of British colonial rule.  For these migrant communities, displaced again by the tsunami, there are new problems—people of Melanesian heritage often have clan and community links that can assist with resettlement.  For non-Indigenous communities, even those who have lived in the Solomon Islands for decades, it is harder to find access to land and resources.

The villagers have sought support from Oxfam and the Solomon Islands Red Cross for provision of water tanks, corrugated iron for water catchment and housing, and other support services.  But conditions remain difficult for the displaced communities, in spite of their resilience.  Sale Sam, who lives in Tiroduke camp up on the ridges above Gizo town, said, ‘Until Oxfam provided water tanks, we had to cart water for miles.  The hill tops are very exposed—the wind blows from all directions, unlike the village which was sheltered’.  Children from lower grades are attending classes up in the hills, but for senior grades the children need to trek down to the coastal villages each day, travelling kilometres to school.  On the coast, women used to go out on the reef at low tide to collect crabs, shellfish and other seafood—an important source of protein to add to food grown in village gardens.  But now it’s harder to easily access this vital food supply.  ‘Our diet is changing now that we live on the higher ground’, said one camp resident.  ‘The men still go down to the coast to go fishing, but we don’t go out so much on the reef.’

Although in his sixties, Sale Sam still works to support his daughter Jocelyn, who relies on a wheelchair for mobility as they make a new home.  For me, the resilience of this young woman, living in a wheel chair on a mountainside in the Solomon Islands, symbolises the larger challenge—what will displacement mean for the many thousands of people who face relocation in coming decades because of climate change?

Refugee or migrant?

In recent years, there is a growing academic literature on climate change, forced migration and conflict, but a mixed response to the concept of ‘climate refugees.’  The United Nations High Commission for Refugees (UNHCR) argues that the term ‘environmental refugee’ is not appropriate, as the definition of refugee under the 1951 Refugee Convention and international humanitarian law has particular limits, covering people who are seeking protection because of a well-founded belief of persecution related to their religion, ethnicity, political beliefs etc.  Signatories to the 1951 Convention have specific legal responsibilities to people who reach their territory and claim asylum and protection, and refugee advocates are reluctant to see these state obligations watered down.

As noted in an October 2008 UNHCR briefing paper Climate change, natural disasters and human displacement: UNHCR has serious reservations with respect to the terminology and notion of  ‘environmental refugees’ or ‘climate refugees’.  These terms have no basis in international refugee law.  Furthermore, the majority of those who are commonly described as environmental refugees have not crossed an international border. Use of the terminology could potentially undermine the international legal regime for the protection of refugees and create confusion regarding the link between climate change, environmental degradation and migration.

Part of the problem is that key UN agencies responsible for displaced people have no formal mandate to address the climate issue.  UNHCR does not cover people who are displaced internally or seek refuge overseas because of environmental causes.  However, because of its practical experience in dealing with large scale forced movement of people, UNHCR staff and resources have increasingly been allocated to support operations in the aftermath of major natural disasters (such as the 2004 Asian tsunami, 2005 South Asian earthquake, 2006 floods in Somalia and 2008 floods in Burma, amongst others).

UNHCR is worried that its existing responsibility for refugees, asylum seekers and internally displaced people will be overwhelmed by the tens of millions of people potentially displaced by climate change.  However the numbers of people who meet the definition of ‘environmental refugee’ are also contested.  Studies have cited global figures ranging from 200 million (researcher Norman Myers) to over 1 billion potential refugees (a 2007 Christian Aid report).  But migration specialists have questioned these numbers, arguing that people affected by environmental impacts will not necessarily cross international borders to seek refuge.

An important 2008 study on forced migration and climate change from the Norwegian Refugee Council, Future floods of refugees, raises crucial qualifications on the term refugees:  There seems to be some fear in the developed countries that they, if not flooded literally, will most certainly be flooded by ‘climate refugees’.  From a forced migration perspective, the term is flawed for several reasons.  The term ‘climate refugees’ implies a mono-causality that one rarely finds in human reality.  No one factor, event or process, inevitably results in forced migration or conflict.  It is very likely that climate change impacts will contribute to an increase in forced migration.  Because one cannot completely isolate climate change as a cause however, it is difficult, if not impossible, to stipulate any numbers.  Importantly, the impacts depend not only on natural exposure, but also on the vulnerability and resilience of the areas and people, including capacities to adapt.  At best, we have ‘guesstimates’ about the possible form and scope of forced migration related to climate change.

Agency and choice

When they look at international rather than domestic impacts, climate advocacy groups in Australia and New Zealand have highlighted the issue of ‘Pacific climate refugees’ in their campaigning.  Many have argued that Australia and New Zealand, as the largest members of the Pacific Islands Forum, have particular responsibilities to their island neighbours.  But do people debating the issue ever ask those most affected what they really want? It may seem trite to see people in developing countries as actors rather than victims in this global emergency, yet much of the climate literature presents the Pacific’s only contribution to the climate debate as a loud ‘glug, glug, glug’ as the islands sink beneath the waves.

The issue of displacement raises a number of practical, emotional and political responses.  In interviews with people around the Pacific, different opinions came from the elderly compared to younger people who have more flexible skills for migration.  As one old man in the Solomon Islands told me, ‘They talk about us moving.  But we are tied to this land.  Will we take our cemeteries with us?  For we are nothing without our land and our ancestors’.  Community activist Annie Homasi from Tuvalu says the slow pace of action by large industrialised countries has the potential to cause uncertainty and even division in the local community, for people who are fearful they may have to relocate from their homes.

‘There’s quite a debate at home, maybe even a division, between the older generation and the young people.  Because they go overseas for school, the young ones say, “Yeah, we have to move”.  But the older ones say, “This is me, my identity and my heritage—I don’t want to go”.’

There are also complex cultural responses in the Pacific, with many religious people stating that God will not forsake them.  Some old people deny any long term threat from floods and rain, citing Biblical injunctions like God’s promise to Noah after the Flood: ‘neither will I ever again smite everything living as I have done’ (Genesis 8:21).

Most Pacific governments are still reluctant to focus resources on displacement issues, because they feel this will acknowledge defeat and undermine negotiating positions at the international level, as they press for stronger targets in the Copenhagen negotiations.

Government leaders from Kiribati and Tuvalu continue to stress that increased mitigation efforts by industrialised nations should be the focus of activity.  Speaking to the UN General Assembly in September 2008, Tuvalu Prime Minister Apisai Ielemia stated: We strongly believe that it is the political and moral responsibility of the world, particularly those who caused the problem, to save small islands and countries like Tuvalu from climate change, and ensure that we continue to live in our home islands with long-term security, cultural identity and fundamental human dignity.  Forcing us to leave our islands due to the inaction of those responsible is immoral, and cannot be used as quick fix solutions to the problem.

Open borders

Most of the discussion of climate displacement in Australia focuses on the need for Pacific Rim countries to change their migration policies.  But the language of the debate revives past fears about being ‘swamped’ by immigrants or asylum seekers.  Concerned activist groups stress Australia’s moral obligations to open its doors while conservatives respond with refrains that echo John Howard’s infamous dog whistle, ‘We will decide who comes to this country and the circumstances in which they come’.

Environmental groups have argued that Australia’s existing humanitarian immigration quotas should not be allocated to climate- related refugees and that an additional category is required.  The Migration (Climate Refugees) Amendment Bill 2007 advanced by the Australian Greens proposed the creation of a new visa class to formally recognise climate refugees, but lapsed without support from the major parties.  Other options could involve an expanded system of free migration as already exists between Australia and New Zealand, which enjoy shared migration rights of free access and permanent residence.  New Zealand’s Pacific Access Category, which provides migration quotas for citizens from Tuvalu, Kiribati, Fiji and Tonga, provides a de facto window for migration from climate affected countries, even though the New Zealand government has not explicitly recognised this as an option dedicated to people affected by environmental impacts.

In contrast, some Pacific leaders have suggested that it may be more appropriate to call for Australian and New Zealand financial support for the resettlement of people to other Pacific islands, to provide agricultural land and a suitable cultural context for displaced rural communities.  A key feature of environmental displacement in the Pacific is that much of the movement is internal, rather than across international boundaries, which places extra burdens on national government budgets as well as host communities who accept people from other areas.

But money is not enough.  A worrying feature of the debate about ‘climate refugees’ is that the bald predictions of forced relocation give little agency or choice to the affected communities.  Compared to a rapid natural disaster like an earthquake or tsunami, the ravages of climate change will mount over time, so people can be engaged in discussing the options.  We must  learn from the failure of past resettlement projects in developing countries, which comes not just from inadequate inputs of resources but from the inherent complexity of this as a social process involving human beings with hopes, dreams, aspirations and especially memories.  Relocation and resettlement is not simply a material infrastructure process—it is also a social process and there are a number of issues of co-operation, voice and justice that need to be addressed.  How do you promote resettlement with respect for equality and equity?

Moving to a new location within a country or across international borders is just the first step, and there are a host of political as well as technical dilemmas for communities on the move:

• Do displaced people have a say in the design and construction of new communities (for example, site selection that can provide water, arable land and other resources; culturally appropriate housing in terms of size, design, spacing and materials; settlement design to allow social and cultural interaction)?

• Are people being compensated for need or loss (that is what they need for survival or for what they feel they’ve lost)?

• Can you be compensated for intangibles, such as the grief of losing a home, or loss of political and cultural identity?

• Will the wealthy leave early, and leavebehind those with fewer resources?

• Will displaced people be better serviced by donors than existing members of the new host community, causing inter-communal tensions?

• Should old power relations and systems of chiefly rule be recreated, or are they tied to past relationships with the lost land?

This raises the core question of whether funding for adaptation and relocation will be allocated without the engagement and consent of affected communities.  Is planning for relocation being done with people or for people?  The potential for displacement because of climate change needs extensive community participation and debate, as noted by Betarim Rimon of the Kiribati Ministry of Environment: ‘In Kiribati, we are talking about relocation over time rather than forced displacement.  We think about relocation as a long, thought out, planned process.’  Kiribati President Anote Tong stressed this in his address to the opening session of the 2008 UN General Assembly: The relocation of 100,00o people of Kiribati, for example, cannot be done overnight.  It requires long term foward planning and the sooner we act, the less stressful and less painful it will be for all concerned.  This is why my Government has developed a long-term merit-based relocation strategy as an option for our people.  As leaders, it is out duty to the people we serve to prepare them for the worst-case scenario.

Australia refuses to plan ahead

In ‘Engaging our Pacific Neighbours on Climate Change’ – Australia’s latest climate policy statement issued in August 2009 – the Rudd government notes: ‘The potential for climate change to displace people is increasingly gaining international attention.  Australians are aware of and concerned about this issue.’  But we need more than awareness and concern.  Successive Australian governments have failed to engage in foward planning involving communities and governments around the region, to address the issues of displacement from a rights-based approach.

For many years, Pacific Rim governments have been reluctant to publicly address this issue.  In October 2006,the then Immigration Minister Amanda Vanstone stated that her Department had not made any plans to deal with people displaced by environmental or climate change, arguing, ‘There’s no such thing as a climate refugee’.  In November 2006, Secretary of the Department of Immigration Andrew Metcalfe told a Senate estimates hearing that the Australian Government had done no planning on how people movement caused by climate change in the Asia-Pacific region might affect Australia.  Since then, however, the debate has been flourishing amongst security analysts and strategic think tanks, which have focused on border protection and the potential for conflict overland and resources.  In 2007, the then Australian Federal Police Commissioner Mick Keelty sparked a political debate when he argued that climate change will turn border security in Australia’s biggest policing issue this century.  He stated that climate change could increase displacement and migration in our region.  ’In their millions, people could begin to look for new land and they will cross oceans and borders to do it.  Existing cultural tensions may be exacerbated as large numbers of people undertake forced migration.  The potential security issues are enormous and should not be understated.’

The securitisation of the debate has also been highlighted in Force 2030 – the May 2009 Defence White Paper issued by the Rudd government.  This is the first the climate issue has been discussed in a Defence White Paper, but it does not really reflect a shift in focus from ‘national security’ to ‘human security’.  In the paper, action on climate changed in reframed through the prism of border security:  The main effort against such developments will of coarse need to be undertaken through co-ordinated international climate change mitigation and economic assistance strategies…should these and other strategies fail to mitigate the strains relating to climate change and they exacerbate existing precursors for conflict, the Goverment would probably have to use the ADF as an instrument to deal with any threats inimical to our interests.

Will people displaced by global warming be redefined as ‘threats inimical to our interests’?  Social justice activists need to reframe the debate, to highlight the right to development for affected communities wherever they are, rather than just focussing on the need for mitigation rights.

]]> http://www.arena.org.au/2009/11/losing-paradise/feed/ 0 http://www.arena.org.au/2009/11/a-new-left-forming/ http://www.arena.org.au/2009/11/a-new-left-forming/#comments Mon, 02 Nov 2009 06:09:10 +0000 zoehatten http://www.arena.org.au/?p=734 In the wake of the global financial crisis and broad acceptance of the reality of climate change, small groups everywhere are asking questions about the politics of the future, especially what a left politics might look like in a post neo-liberal and rapidly warming world.  At one such meeting recently, held in Geelong at Deakin University, the tone was practical: the time is right post the GFC; the evidence is on climate change; we have to tap into and guide an emerging sense of a need to change and a new politics will take shape.  David McKnight led off with his argument for a poltiics ‘beyond left and right’ centred on ‘values’ as a guide to a more regulated market economy and kinder society – what he and others described as new social democracy.  Michael Pusey took over with a gripping account of the kinds of narratives that would lead ordinary Australians out of consumption mania and redirect their latent good sense into a more caring, if still self-interested, co-operative path.  Again, the assumption was very much that the time was ripe: a well-put publicity campaign that targeted key features of the Australian character would go a long way to redirecting our self-obsessions and consuming habits of the last fifteen or so years.  Especially as ’selling restraint’ is so difficult, we needed a positive story to tell about ourselves that would lead us to want to be responsible for the environment and our collective future, which must involve some kind of reduction in consumption.

The overall narrative to which Pusey, and then others, referred was first and foremost about recovering the Australia nation.  This would have to be the shell for any appeal to Australians, but now turned away from Howards ‘paranoid’ version to a softer nationalism, which could be grown naturally enough upon the bedrock of who we Australians really are.  Pusey’s descriptors included ‘secular’, ‘sharing’, ‘national’ and ‘practical’.  We are at heart, he said, Benthamites – utilitarians, not taken with theoretical or spiritual claims or absolute values, a common sense people with, it would seem, a modest self-interest that had been perverted by neo-liberalism.  In relation to climate change, a cornerstone issue for this future politics, the message must not be overwhleming.  The ‘urgent present’ of current campaigning must be re-narrativised in ‘lived time’ drawing on our ‘historical past’.  Constructing recognisable stories about ourselves that draw on those distinctive traits, we will be able to see ourselves as agents with a collective story at stake.

Overall the conference, over two days, was stimulating.  Not every paper-giver was as upbeat about the possibilties, with Green activists of different organisational alleigances more or less depressed by the hugeness, if not impossibility, of the task ahead.  But the obvious fact of people being engaged, and so many of them being young, was testimony to sense abroad that politics is again on the agenda.  Indeed, it is everywhere being discussed how we might reform our democracies, re-orientate markets, change values.  The emerging ferment is evident in the pages of this issue of Arena Magazine, living by its brief as an arena of a broad Left.  On the one hand, Tom Nairn positively assesses Rudd’s new social democracy from the vantage point of a dismal showing by British Labour, while Guy Rundle, on the other, sees Rudd as a ‘far from emancipatory’ micromanager of comtemporary life.  Andrew Thackrah discusses an influential new British book on climate change strategies and new possibilities for the citizen, as opposed to the consumer, while Russell Marks, countering the ‘racist’ accusation in relation to Indian student attacks, draws on some of the ‘new nationalism’ arguments put at the Deakin conference.  Alternatively, in a virtual how-to build your own, Race Mathews argues for a different tradition of worker co-operatives, while Ted Trainer and John Martin posit a ‘simpler way’ with a rural or close-to-nature orientation, as a kind of lived transitional practice.

The Deakin conference wasn’t nearly so broad a church.  There was a strong sense of an already forming policy orientation, and this has been evident since in The Australian’s series ‘What’s Left?’.  Also led off by David Mcknight, it has had contributions from a range of writer activists, unionists, and politicians, with Robert Manne providing a broad politico-philosophical framework, also championing the new social democracy idea, as already clear in his writings in The Monthly since Rudd’s essay in that publication in March this year.  No new party is being suggested by this loosely associated group, so it would seem that the task may be to create a think tank or develop a forum that will provide tapped-in ideas and create a culture of new thinking to bolster Labor’s efforts, especially in relation to climate change.

But the rush to policy around a notion of ‘values’ is only partly reassuring, while the rush to confirm the said national trait of utilitarian (no theory, optional spirit and plain practical common sense) is not at all.  While Pusey’s observations may be empirically based, one couldn’t help wondering about both the religion that was once – not so long ago – a common feature of Anglo-Celtic Australian life (when spirit and moral absolute matched), and the many faith-based communities that have come to reside in Australia since the Anglo-Celt’s great secularisation.  And quite apart from this, given that the values and ideals evinced in the long period of neo-liberal ascendancy appeared to have their own transcendent quality, and given that utilitarianism may be a key undergirding of neo-liberal common sense, references back to some typical Benthamite Australian, rather than a break into something actually new, seems likely to be a hollow echo of a need rather than a meaning-laden call to change.

Robert Manne’s framing piece in the ‘What’s Left?’ series provides a larger canvas for this discussion of value and of theory, where some seem to think values can be egged into reality and theory dispenses with because all good people already know the answers.  Manne commences with the French Revolution and the values of liberty and equality (he neglects fraternity) which, he says, set the whole liberal ball rolling and around which the dominant perversions of 20th-century politics were played out: communism in its pursuit of equality denying liberty, and Nazism in its communalist fantasy denying equality on the basis of racialist ideology.  As the century proceeds, the two men left standing – social democracy and neo-liberalism – remain committed essentially to liberty, though of different ilks, with very different outcomes for the question of equality.  All the same, rejecting extremes of earlier communalist fantasies, and now in the death throes of neo-liberalism, those two values, liberty and equality, remain the pole stars of true democracy, indeed ’social democracy’.

Social democracy in this view is social liberalism, not democratic socialism, and capitalism is simply not a target.  Neo-liberalism certainly is, but the competitive basis of capitalism itself, the forms of utilitarianism it has spawned, its fundamental counter to substantive equality, and indeed its denial of freedom of many peoples in many parts of the world, is simply left out of the equation.  In fact in this key article in a series called ‘What’s Left?’, which is an historical survey, albeit brief, of the key moments of Western political history, and now the key issues of the day, no mention whatsoever is made of ‘capitalism’.

This is intriguing.  The first thing to observe is that Manne is a political theorist, not in any way a social theorist.  The form of society, the means by which people are integrated into the collective life of a social form, the way culture constitutes us historically as significantly different different types of people over time – picket fence individualists (normalised subjects) in modernity, transgressive boundary-crossers (autononous actors) in postmodernity – is not on his radar.  And so any understanding of how these culturqal forms, embedded in deep structures of social and individual experience, underpin and play out in relation tot he valeus of the time and questions of the day is mightily restricted.

Those people with left histories now hopping on board this social democratic train may be deeply contrite about the role played by communism in the radical denial of both liberty and equality in actually existing socialism, and desperate for action in the face of climate change, but they may also be indulging others in writing a very partial history of the modern period.  The values of liberty and equality in Manne’s piece are themselves disconnected from their roots in the rise of modern capitalism and the form of life and power it implied; just as left struggles for 100 years are given no mooring in the depredations of extreme class conditions under domestic capitalism or colonial oppression; just as contemporary assumption about what individuals desire and feel they deserve seem to be denied specific analysis, perhaps for fear, ironically, of our utilitarian bent being upset by ‘too much theory’ and the expectation that good people will simply respond to good values.

There’s no doubting that politically a break into new consciousness has to be made, and that it will be in part arbitrary.  Fear, logic or intuition: a break has to be made from the claims and chains on consciousness that the form of society has over our being (which is never total).  But we must not shy away from a deep account  of the nature of that being, which is always historically re-constituted, and which can help to account for the difficulties in carrying through good programs on the basis of good values that others don’t share, or not yet.  Narratives are one thing, but structural accounts of the specific nature of contemporary social forms offer the more solid ground for working those narratives out.  In this case, while a certain practical attitude may define something about Australian life and national culture, the idea that some past good Australianness can be dug up and appealed to, as if our goodness was simply perverted by ‘neo-liberalism’, is likely to miss the constitutional commitment both of Rudd and the population to a utilitarianism now fed by the expectations of a post-modern market and high-tech solutions to our myriad problems.  If Manne could not name capitalism in his short history, resting entirely on a notion of neo-liberalism to do his work, this must be because it is seen primarily as a political philosophy, which has engineered a system, rather than an efflorescence of deep trends in the meshing of intellectual technique and capitalist development over centuries.

From a standing start in 1956, the MCC has grown to the point where by mid-2008 it was the seventh largest business group in Spain. Annual sales increased between 2006 and 2007 by 12.4 per cent to some $US20 billion, and overall employment by 24 per cent, from 83,601 to 103,731. Exports accounted for 56.9 per cent of industrial co-operative sales, and were up in value by 8.6 per cent. Mondragon co-operatives now own or joint venture some 114 local and overseas subsidiaries.

Like other businesses, the co-operatives now find themselves hard hit by the economic meltdown; their members are tightening their belts in a further exercise of the solidarity that has enabled them to weather previous major downturns and achieve new heights. For example, in 2008 worker-owners at the Fagor appliance co-operative elected to forego the additional four-weeks pay normally due to them over the Christmas period, and have subsequently cut their pay by 8 per cent. As the MCC’s Human Resources Director, Mikel Zabala, points out, ‘We are private companies that work in the same market as everybody else. We are exposed to the same conditions as our competitors’. What then are the attributes to which Mondragon owes its remarkable success?

Industrial Co-operatives

The basic building blocks of the MCC have been its industrial co-operatives. The industrial co-operatives are owned and operated by their workers. The workers share equally in the profits — and, on occasion, losses — of the co-operatives, and have an equal say in their governance. That they are able to do so is due to the unique structures and systems of governance and financial management which the Mondragon co-operatives have developed. In the case of governance, the workers in a co-operative have their say in the first instance through its General Assembly, where the performance of the co-operative is discussed and its policies determined. The workers also elect a Governing Council, which conducts the affairs of the co-operative between Assembly meetings, and an Audit Committee — referred to by some as the ‘Watchdog Committee’ — which monitors the co-operative’s financial operations and its compliance with its formally established policies and procedures. Only members of the co-operative, all of them workers, are eligible to stand and voting is on a ‘one member, one vote’ basis.

Successful candidates hold office for a four-year term, but continue to be paid their normal salaries and receive no compensation for their Council responsibilities. Council meetings are normally held before the working day begins, and members then resume their normal workplace duties. The Council appoints a Manager for the co-operative on a four-year contract, which may be renewed subject to a mandatory review of his performance by the Council. The Manager may attend Council meetings in an advisory capacity, but is not a member and has no vote. There is a separate Management Council where the top executives and officers of the co-operative liase with one another on a monthly basis. The separation of the Management Council from the Governing Council reflects the clear distinction which the co-operatives draw between the governance function which is properly the prerogative of their members and the carrying on of operations for which management is responsible.

A final body, the Social Council, is elected annually, by and from shop-floor groups of from twenty to thirty workers. Members of the Social Council hold office for a two-year terms, and may offer themselves for re-election. The Council is a unique structure, with a highly distinctive contribution to the well-being of the co-operative. Whereas the Governing Council represents the members of a co-operative primarily in their capacity as its co-owners, the Social Council represents them primarily as workers. The Council’s character in this respect reflects in part the fact that the co-operatives were established during a period when trade unions had been outlawed by the Franco government. Franco’s negation of workers’ rights was unacceptable to Arizmendiarrieta and his associates. In effect, the Social Council has had built into it the union function of enabling members to monitor, question and, if necessary, oppose the policies of the Governing Council and management. The Social Council is required to give advice to the Governing Council on industrial and personnel issues — for example, working hours, the evaluation and classification of jobs, and occupational health and safety — which the Governing Council must consider before its decisions on them are finalised. In recent years, some co-operatives have mandated their Social Councils to bargain formally for members with their Governing Councils.

The earnings of a Mondragon co-operative are the property of its members. In place of wages, members are paid monthly advances, referred to as anticipos, against the income their co-operative expects to receive. Two further advances required by Spanish custom are made available at Christmas and for the summer holiday period. The co-operatives observe a ‘principle of external solidarity’, under which no advance should exceed by more than a narrow margin the wages paid for comparable work by nearby private sector businesses. The level of each member’s advance is determined in the first instance by a labour value rating which the Social Council of the co-operative assigns to the job. Overall, incomes are kept as equal as possible. The highest advances a co-operative pays its members cannot exceed the lowest by more than eight to one. By 1990, members had had an estimated increase in their purchasing power since 1956 of around 250 per cent.

A further share of the co-operative’s earnings is credited to the members as capital. The capital structure has been designed to produce the greatest possible consciousness on the part of each member who is a stakeholder in the co-operative. The identification is achieved initially by requiring as a condition of entry to the co-operative that each member should make a direct personal contribution to its capital. There is an entry fee which currently stands at about $US12,500. Payment can be made on the basis of a 25 per cent initial contribution, followed by monthly instalments. The co-operative then establishes an individual capital account for the member, to which 70 per cent of their initial contribution is credited. The capital accounts earn interest at an agreed rate, and are credited each year with, say, 40 per cent of the co-operative’s surplus, apportioned among members on the basis of their salary grades and the hours worked. Members may draw on the interest accumulated in their accounts, or use the accounts as collateral for personal loans, but the principal cannot normally be touched until they resign or retire. Payouts from the capital accounts of members currently retiring in Mondragon — over and above their superannuation entitlements — are in some instances in excess of $US100,000. A further 50 percent of the co-operative’s surplus goes to its permanent reserves, while Spanish law requires 10 per cent to be set aside for social and educational purposes. A co-operative which incurs a loss may require its members to re-invest the extra Christmas or summer holiday advances which they would otherwise have taken in cash. Alternatively, they can forego the interest which would otherwise have been paid on their capital accounts. In extreme cases, the value of capital accounts can be written down or even written off.

Worker/Consumer Co-operatives

Mondragon’s initial focus on industrial co-operatives was expanded by the creation in 1968 of its Eroski worker/consumer co-operative. Reflecting the overall Mondragon approach, Eroski, unlike traditional consumer co-operatives, is not limited to consumer members. Instead, its membership falls into two categories, namely, the workers who operate its outlets and the consumers who shop at them. The Governing Council has equal numbers of worker and consumer members, with the position of chairman always being held by a consumer. A further difference is that Eroski does not pay the traditional consumer co-operative dividend, but instead concentrates on low prices, healthy and environmentally-friendly products and consumer education and advocacy.

Eroski is today the most rapidly expanding component of the MCC, with some 2441 retail outlets, ranging in size from petrol stations and small franchise stores to hyper-markets and shopping malls, in locations that now extend beyond Spain to France and Andorra. It is a key participant in the Spanish Confederation of Consumer Co-operatives, speaks for the Confederation in its dealings with government and the media and is also active in the affairs of the Consumer Advisory Council in Brussels.

Mondragon Mark I

The industrial, worker/consumer and service co-operatives at Mondragon have benefited from a unique system of second-order or support co-operatives and groups. Just as the primary co-operatives were formed in response to a pressing need on the part of workers for jobs, and of the Basque region more generally for economic development, so the secondary co-operatives have been a response to the need of the primary co-operatives to co-ordinate their activities and access capital and support services such as social insurance, education and training and research and development. The co-ordination and support structures and procedures, as distinct from the primary or frontline co-operatives, have undergone major changes. A broad familiarity with the arrangements in their original form — with what was in effect Mondragon Mark I — is needed in order to properly understand the nature and purpose of the Mondragon Mark II which in key respects has replaced them.

The Caja Laboral Credit Union

The core and nerve centre of what is now the MCC was originally the Caja. Arizmendiarrieta realised at a very early stage in the life of the group that expanding the existing co-operatives and creating new ones would require reliable access to capital on affordable terms. ‘A co-operative’, he wrote, ‘must not condemn itself to the sole alternative of self-financing’. As has been seen, his insight resulted in 1959 in the establishment of the Caja in order to mobilise capital for the co-operatives from the local and regional communities. The slogan used by the Caja in the early stages of its development was ‘savings or suitcases’, indicating that local savings were necessary in order for there to be local jobs. The Caja also provided a means for the co-operatives to manage the capital held in their permanent reserves and individual capital accounts, so enabling them to retain within the group all of their surpluses other than the 10% allocated by law to community projects. The effect overall was to free the co-operatives from the capital constraints which otherwise would so drastically have curtailed their development. The Caja enabled the co-operatives to borrow at interest rates which were 3 per cent to 4 per cent below those of conventional financial intermediaries.

From functioning purely as a source of capital for the co-operatives, the Caja then moved on to become the mechanism through which their association with one another was formalised and their activities integrated. The individual co-operatives were linked to the Caja through a Contract of Association which set out in detail their respective obligations and entitlements. For example, it was a requirement of the Contract of Association that an affiliated co-operative should adhere to an agreed system of wage levels and ratios. Returns to members on their capital contributions should be at a fixed rate of interest. The co-operative should invest in the Caja and the surplus cash and liquid assets of the co-operative should be held for it on deposit by the Caja. The co-operative’s deposits with the Caja should also include all holdings on behalf of its members, such as pension funds, social security funds, and workers’ share capital. The co-operative should adopt a five year budget and report on it to the Caja at monthly intervals. The financial affairs of the co-operative should be subject to audit by the Caja at intervals of no more than four years.

The Caja lastly had a key role in developing new co-operatives, advising and otherwise helping out co-operatives which were experiencing difficulties and, more generally, providing an integrated mix of services for co-operatives in all stages of their development. These functions of the Caja were performed by its Empresarial Division. The Division consisted of seven departments — Advice and Consultation; Studies; Agricultural and Food Promotion; Industrial Promotion; Intervention; Auditing and Information; and Urban Planning and Building — with around 120 worker-members.

Where new co-operatives were concerned, a group of workers who were interested in establishing a new venture had first to find a product or service for which they believed there was a market, along with a manager. They were then in a position where an approach could be made to the Empresarial Division. If the Division believed that the proposal was sound, it assigned an adviser — sometimes known as the ‘godfather’ — to the group. The group in turn registered as a co-operative and accepted a loan to cover a salary for the manager while pre-feasibility and feasibility studies were conducted. The studies usually lasted between eighteen months and two years. In the course of that period, the group’s preferred product might be discarded in favour of an alternative drawn from the ideas bank which the Division maintained from its own market research. Attention then focused on factors such as factory design, production processes, marketing strategies and export opportunities. The completed study was presented to the Operations Committee of the Banking Division of the Caja, which determined whether the venture should be approved. Where a co-operative proceeded, the Empresarial Division godfather usually went on working with its manager until the break-even point was reached. The co-operative and the Division then remained in touch through the monthly return of operating and financial information the co-operative agreed to provide as a condition of its Contract of Association. The information was stored in a computerised data bank, so enabling the Division to at any time call up a comprehensive account of the status of the co-operative and the trends currently being experienced.

Where an established co-operative experienced difficulties, the Empresarial Division had the capacity to help out through the professional services of its Intervention Department. The data base compiled from the monthly returns of the affiliated co-operatives enabled the Department to have emerging problems brought to its attention, in some cases earlier even than the managers of the co-operative directly involved. An intervenor was then appointed, who assessed the situation of the co-operative in terms of three categories of risk. A summary of the categories by two American scholars reads in part:

1. High Risk. The life of the co-operative is threatened. The intervenor reviews every aspect of operations and in effect takes over management on a full-time basis until a reorganisation plan is approved or the co-operative must be closed. Interest payments on outstanding loans are suspended until the plan is in place.

2. Medium Risk. Bankrupcy is not imminent but could occur in the near future. In such cases the intervenor spends at least one day each week at the co-operative during the reorganisation but does not take over the management of the firm. Interest on loans is reduced temporarily by — say — half, but returns to the full rate as the reorganisation progresses.

3. Warning or alert level. Here the threat of failure is not imminent but current trends are negative, suggesting a need for remedial action that may be beyond the capacity of the co-operative. No interest rate concessions are offered, as it is anticipated that the intervention will make the interest burden manageable.

Once the seriousness of the situation has been determined, the intervenor has the task of working out with the co-operative a new business and re-organisation plan.

The plan might require changes in the marketing strategies, manufacturing methods or product mix of the co-operative. Other changes might involve the organisational structure of the co-operative or the appointees currently occupying its key management positions. Members might be required to accept reductions in their anticipos or contribute additional capital. Where in extreme cases a reduction in the workforce was necessary, it fell to the Social Council to identify in conjunction with management those members who were to be retained in their current positions, those who were to move to new positions and those who were required to leave, normally by transferring to another co-operative whose business was expanding. Once agreement on the plan had been reached, the co-operative was responsible for securing approval of it from the Financial Division of the Caja. The Financial Division was required to determine whether interest on the co-operative’s loans should be suspended or reduced or in what other ways, if any, the co-operative should be assisted.

The mutuality of interest between the Caja and the primary co-operatives which are linked with it through their Contracts of Association — together with the credit union’s functions in regard to the co-operatives of capital mobilisation and management, integration and support — were entrenched in its structure and governance. Forty-two percent of the delegates to the General Assembly of the Caja are from its workers and 58 per cent from the affilated co-operatives. Seven seats on the Board are for the affiliated co-operatives, four for workers in the Caja and one for a representative of wider sectorial groupings of co-operatives. Rather than the Caja’s workers having allocated to them a 40 per cent share of its annual surplus, as is the case in the affiliated co-operatives, their capital accounts are credited with the average of the amounts credited to members of the affiliated co-operative. The Caja has succeeded so spectacularly as to have now become effectively the tenth largest bank in Spain. Its assets are now so large that loans to the co-operatives now account for no more than 25 per cent of its overall lending, or 10 per cent of its capital, with the balance available for regional economic development and other investment projects, often in partnership with the Basque government. Its example triumphantly vindicates Arizmendiarrieta’s faith in the capacity of working people to provide for themselves through co-operation and economic solidarity the jobs for which they can no longer rely on others.

Lagun-Aro Social Insurance Co-operative

A second support co-operative, the Lagun-Aro social insurance co-operative, began as a division of the Caja. Being co-owners of the businesses where they work instead of employees meant at the time that members of the Mondragon co-operatives were ineligible for health and retirement benefits under the Spanish social security system. What was originally the social insurance division of the Caja was established to remedy the deficiency, by providing a fund to which the co-operatives could subscribe through pay-roll deductions and from which benefits for their members could be drawn. In 1967, the division became independent of the Caja as Lagun-Aro, with a Governing Council which included representatives of the co-operatives affiliated with it. The functions and service-mix of the co-operative have varied over time, reflecting changing needs and government policies. The health care clinic Lagun-Aro conducted at Mondragon for many years was taken over by the Basque government in 1987, as a model for other towns in the province. Rather than administering pensions as previously on an in-house basis, Lagun-aro now contracts out the function to a fund, Mutualidad de Autonomos, conducted by the state. At the same time, a general insurance subsidiary (Seguros Lagun Aro) and a life insurance subsidiary (Seguros Lagun Aro Vida) have been established, as have subsidiaries for leasing and consumer finance (Aroleasing and Arofinance) and a subsidiary for the development of shopping malls (Lagun-Aro Intercoop) in conjunction with the Eroski worker/consumer co-operatives.

Hezibide Elkartea Education and Training Co-operative

A third support group, the Hezibide Elkartea, stemmed from the establishment by Arizmendiarrieta of the training school for apprentices in Mondragon in 1943 and of the League of Education and Culture, a body to promote and co-ordinate education on all levels for all children and adults, in 1948. The apprentice school and the League played a key part in the consciousness-raising through which the establishment of the first of the industrial co-operatives, Ulgor, was instigated. The Hezibide Elkartea has come to cater for programs ranging from day-care to advanced technical and management skilling to adult education. The apprentice school is now a university-level polytechnical college, the Eskola Politeknikoa Jose Maria Arizmendiarrietra. Over and above its mainstream teaching programs, the Hezibide Elkartea brings together specialist bodies such as the Saiolan centre for new business activities education, training and development; the Goeir centre for the co-ordination and promotion of overseas postgraduate engineering and technical studies; the Eteo school of business management; the Iraunkor centre for continuing education and in-company training; the Ahizke-CIM centre for language studies; and the Otalora Centre for co-operative research, education and management training.

Students at the Eskola Politeknikoa have a co-operative of their own, Actividad Laboral Erscolar Cooperativa (or Alecoop for short), that enables them to support themselves financially during their courses, while at the same time obtaining a hands-on experience of how co-operatives work. A further network of educational co-operatives offers a bi-lingual education in the Basque and Spanish languages at the pre-school, primary and lower secondary levels. Funds for the schools are drawn in part for the social allocations of the Caja and its affiliated industrial co-operatives. Their General Assemblies include staff, parent, student and affiliate members. Faced in 1993 with demands by the Basque government that schools receiving government funds should join the government system, 80 per cent of the schooling co-operatives voted for rejecting the government’s money and retaining their independence.

Ikerlan Research and Development Co-operative

A fourth support co-operative, the Ikerlan research and development co-operative, reflects the high priority which the Mondragon co-operatives have attached to keeping abreast of modern technology. This pattern, like so much else about Mondragon, was shaped by Arizmendiarrieta, through his initial choice of technical education as the means of bringing the community together and instigating change, and his insistence throughout that by mastering technology it would be possible to bring about higher forms of human and social development. ‘Our people’, he argued, ‘require of our men the development of the means to scale the heights of scientific knowledge, which are the bases of progress’. Arizmendiarrieta’s advice caused research and development to be pursued vigorously from the start by individual co-operatives and the Mondragon polytechnical college, but this allowed insufficient scope for inter-disciplinary problem-solving and cross-fertilisation within the overall scientific and technical workforce. Ikerlan was hived-off from the college in 1977 as a separate support co-operative, in order to overcome these shortcomings, and further strengthen the competitiveness of the industrial co-operatives in the export markets where their future was seen to lie. As in other support co-operatives, the General Assembly consists of the worker/members of the co-operative and representatives of the affiliated primary co-operatives.

An extensive staff of highly qualified engineers and technicians enables Ikerlan to provide contract research and development services for co-operatives affiliated with the MCC, private sector businesses other than those in direct competition with the co-operatives and agencies of the Basque government. Ikerlan is also an active member of the European Association of Contracted Research Organisations, and offers competitive research fellowships for visiting scientists and engineers under industry re-vitalisation programs funded by the Basque government. A further support co-operative, Ideko, specialises in machine tools research and development.

Co-operative Groups

Over and above its unique support co-operatives, Mondragon was reinforced by a structure of groups or divisions which linked individual co-operatives together, both geographically on the basis of their proximity to one another, and by similarity of the sectoral activities in which they engage. Geographically, there were twelve regional groups of co-operatives. The structure stemmed from the rapid growth of the original household appliances co-operative, Ulgor, in the early 1960s. Faced with a co-operative which was outstripping by far the limits within which the advantages of growth could be achieved without succumbing to the bureaucratic rigidities, Arizmendiarrieta and his associates developed a policy of spinning-off those sections where a level of efficiency was achieved such as would enable them to function successfully as independent entities.

In this model, the components manufactured by the new co-operatives had an assured market in Ulgor but could also be sold to other buyers. In order to balance the interests of the new co-operative with those remaining behind in the parent body — and to avoid loading the new co-operative with costs such as the establishment of marketing and other specialist divisions of its own — a co-operative group, ULARCO, was formed from Ulgor itself, the Arrasate co-operative which supplied machine tools for Ulgor and the Copreci co-operative which supplied Ulgor with parts for its gas stoves and heaters. A fourth member, Ederlan, resulted from a private sector foundry being taken over and combined with the foundry at Ulgor. Fagor Electrotechnica became the fifth member when it was spun-off by the three foundation co-operatives, as an independent co-operative manufacturing electronic components and equipment.

ULARCO adopted a structure similar to that of the individual co-operatives. Its General Assembly comprised the members of the governing councils, management councils and audit committees of the affiliated co-operatives, and was responsible for determining the policies of the group, making decisions about admissions to — and exclusions from — the group, and approving all accounts and budgets. There was also a Governing Council, made up of one member from each of the affiliated co-operatives, a General Management Committee chosen by the Governing Council and a Central Social Council comprising one representative from each of the Social Councils of the affiliates. Similar structures were adopted by the other regional groups.

The groups enabled key planning and co-ordinating functions to be undertaken in the interests of their affiliates. From 30 per cent to 100 per cent of the surpluses earned, or losses incurred, by individual co-operatives were pooled through their regional groups, so providing further protection for the co-operatives against the problems to which short-term market fluctuations might otherwise expose them. The groups facilitated the exchange of members between co-operatives whose markets were expanding and those experiencing contractions. Dialogue between the Governing Councils and Central Social Councils of the groups, reflecting in part discussion within and between the affiliated co-operatives, in some instances played a major part in enabling the co-operatives to implement the re-positioning and re-structuring forced on them by Spain’s entry into the European Community and the economic stringencies of the 1980s and the 1990s.

Mondragon Mark II

What has been effectively the replacement of Mondragon Mark I by Mondragon Mark II between 1987 and 1991 reflects the capacity of the co-operatives to re-invent themselves in the light of new challenges and changing circumstances. A series of congresses of the co-operatives since 1987 — drawing in part on recommendations from the Caja adopted by a pre-constituente congress in 1984 — has radically altered the original structure, so that the co-operatives now relate to one another in new ways. The governing philosophy of the co-operatives was codified by the 1987 Congress in an explicit ten-point declaration known as ‘The Basic Principles of the Mondragon Experience’. The ten points are respectively open admission, democratic organisation, sovereignty of labour, the instrumental and subordinate character of capital, participatory management, payment solidarity, interco-operation, social transformation, universality and education. The declaration reads in part that admission to a Mondragon co-operative is available without discrimination on religious, political or ethical grounds or due to gender, subject only to applicants agreeing to be be bound by the principles and proving that they are professionally capable of carrying out such jobs as may be available. Members participate in the governance of the co-operative on a ‘one member, one vote’ basis, irrespective of their positions, seniority, hours worked or capital contributions. The co-operative recognises the primacy of labour in its organisation and the distribution of the wealth created; rejects the contracting of workers who are not admitted to membership; and seeks to provide work for all who are in need of it.

Capital is seen as being an instrument, subordinate to labour and subject to a maximum rate of return. The democratic character of the co-operative implies a progressive extension of opportunities for involvement by its members in business management, through mechanisms and channels for participation, freedom of information, consultation, implementation of social and professional training plans for members and the establishment of internal promotion as the basic means of filling positions of higher professional responsibility. Solidarity should be observed externally, so that rates for equal work are roughly the same within the co-operative as in the wider community. There should be co-operation by co-operatives, both within and between sectoral groups, and by the MCC with the Basque and international co-operative movements. The MCC should contribute to economic and social reconstruction and to the creation of a Basque society which is more free, just and expressive of solidarity; act in solidarity with all those working for economic democracy in the sphere of the social economy and championing the objectives of peace, justice and development which are essential features of international co-operativism; and provide education and training in co-operation for its members, management bodies and in particular the younger generation of members on whom its future depends. The Basic Principles broadly reflect, and in key aspects improve upon, those of the International Co-operative Alliance.

The 1987 Congress also established a special fund, the Interco-operative Solidarity Fund (Fiso), to help out co-operatives in economic difficulties with resources over and above those available from the Caja, and so avoid job losses. A further fund, the Fund for Education and Inter-co-operative Development (FEPI), was established by the 1989 Congress, to assist participation by smaller co-operatives in larger and longer-range projects, with funds drawn from the social contributions of those which are larger or better off. The 1991 Congress endorsed recommendations from the Governing Council in 1989 for the move to the sectoral groups and the establishment of the MCC. The Caja has surrendered its central co-ordinating functions, and is now a conventional co-operative financial intermediary, lending largely to private sector businesses. Co-ordination and strategic planning are now the responsibility of the MCC. The MCC is a tripartite structure, made up at its base of three sectoral groups – the Financial Group, the Industrial Group and the Distribution Goods Group. The Industrial Group in turn has a further eight sub-groups, namely Capital Goods I, Capital Goods II, Automotive Components, Domestic Appliance Components, Industrial Components and Services, Construction, and Household Goods.

The General Assembly of each co-operative affiliated with a group sends a delegate to a Group Assembly. The Group also has a General Council made up of the chairperson of each co-operative together a further member from each co-operative’s Board, and a Management Committee consisting of the managers of the co-operatives. The General Council selects a member of the Management Council as the Group CEO. The aim is to have a common business strategy for each sector, including the adoption of common identifiers such as brand names, trademarks and logos. The groups have also had devolved to them the intervention function which was previously performed by the Empresarial Division of the Caja. Other function of the Empresarial Division have been assumed by the Lankide Suztaketa I and Lankide Sustaketa II management and engineering consultancy co-operatives, the Saiolan business activities development co-operative and an MCC Services Co-operative within the corporate headquarters of the MCC.

The groups are responsible for the management of workers whose co-operatives cease to have positions for them. Workers so affected are normally relocated – and where necessary re-trained – for positions in co-operatives whose businesses are expanding. While the objective of protecting employment has largely been achieved, the groups have not necessarily in all cases been thanked for their efforts. Transfers are seen to have generated frustration, rejection and ill-will among these affected by them. ‘The transferee’, in the view of a major study, ‘feels himself/herself to have been ‘managed’ rather than consulted; feels less a co-operative member than the rest, as if he/she were a second-class citizen’.

Members of the co-operatives affiliated with the MCC elect delegates to a Mondragon Co-operative Congress. The Congress meets at intervals of not more than two years, to consider the philosophy, policies and operation of the MCC. Two further bodies, the Standing Committee and General Council of the Congress, look after the affairs of the Congress between its meetings. The Standing Committee consists of the president, vice-president and secretary of the Congress, together with representatives from each of co-operative groups and secondary support co-operatives. The members of the Council are the heads of the co-operative groups and support co-operatives. Congress decisions ‘in general will have the character of recommendations to the co-operatives represented in the Congress’. In order for a decision to be binding on the co-operatives, ‘it must be proposed by the Governing Council, be presented by the Standing Committee and be approved by the full Congress by an absolute majority’.

Conclusion

In the face of the world’s economic vicissitudes, Mondragon has been steadfast in its adherence to the fundamental principles with which its founders endowed it, and continues to enlarge the scope of their application. Eroski is currently adopting new measures to enfranchise the 35,000 of its 50,000 workers who are not currently worker members. The co-operatives have entered into a solemn commitment to extend worker ownership measures to their local and overseas subsidiaries on a case by case basis, consistent with their differing cultural, legal and financial circumstances.

In a passage written a few days before his death in 1976. Arizmendiarrieta wrote in part:

Hand in hand, of one mind, renewed, united in work, through work, in our small land we shall create a more human environment for everyone and we shall improve this land. We shall include villages and towns in our new equality; the people and everything else: ‘Ever forward’. Nobody shall be slave or master to anyone, everyone shall simply work for the benefit of everyone else, and we shall have to behave differently in the way we work. This shall be our human and progressive union — a union which can be created by the people.

It is not necessary for us to suppose that the Mondragon model can be transplanted in its entirety to other countries. What is required of us is rather that we should take from Arizmendiarrieta the message of hope his words hold out to us, study such aspects of the Mondragon experience as are relevant to our needs and circumstances and open our minds to what it can teach. Arizmendiarrieta summarised the Mondragon approach as ‘We build the road as we travel’. The question in these straitened times is whether we will make for ourselves the future of our choice — whether we will take back control over our lives and destinies by the co-operative means whose availability Mondragon so plainly demonstrates — or by default allow others to choose the future for us.

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