The NDIS is based on an inquiry by the Productivity Commission (PC). The PC's thinking is entirely in the monetarist mould - that is, how can we save money? These are like the MBA graduate who comes into the top-level of a century-old family business and only knows how to cut-cut-cut. Within ten years, the business has been run into the ground, the MBA has his bonuses and has moved on to the next target. The PC is driven by no other motive than to implement economic rationalism in the most extreme way possible wherever it looks.
The PC thinks in terms of "cost-benefit analysis". Variables are defined and are given algebraic symbols. Their own illegitimate "values" such as "resource transfers" to people with disabilities, efficiency benefits in services (which means reduced cost) and government budget savings are enshrined in mathematical symbols thereby giving them apparent legitimacy for the lay reader. These variables are combined in equations. The outcome, voila, is promoted as good government policy. Consider page 958 of the report (page 18 of the Chapter 20 pdf) which is available at this page).
...the NDIS and associated reforms produce three broad economic benefits:
The remaining relevant factor is the distorting impacts of taxes (MEB) [the 'marginal excess burden' of tax], which as noted earlier, is around $1.56 billion.
Given there are around 410 000 people funded by the NDIS, the value of V+E+F per participant in the scheme would have to exceed about $3800 per person to pass a conventional cost-benefit analysis.6 [Footnote 6: That is, $1.56 billion/410 000.] Given the large intangible costs described above and in chapter 2, and the reasonable prospects for some benefits from both E and F, that prospect seems strongly probable. The NDIS meets the 'plausibility test'.
No-one could argue against "resources transfers to people with disabilities". But this is only the sheep's clothing that the PC has put on its thinking. For the PC, the economy is the ultimate zero-sum game. The only way that these "resource transfers" occur is by taking some income from a person without a severe physical disability and giving it to the person with a disability.
The PC gives the example of Mary and Mike. Mary has a severe physical disability and an annual income of $25,000 whereas Mike has no disability and an income of $150,000. The PC report says, "To give a concrete example, Mike has an annual income of $150,000, which he spends on all basics of life, but also holidays, a nice house and a car" and, according to the PC, "There are many people like Mike in Australia and relatively few people like Mary." If we take $1000 from Mike and find 15 "Mikes", then $15,000 can be transferred to Mary. The loss in "wellbeing" suffered by the Mikes is only marginal whereas Mary experiences a significant rise in wellbeing, because the $15,000 would make a large difference to her life, whereas $1000 from an income of $150,000 is hardly noticeable.
The zero-sum is evident in proposals to implement the NDIS but not quite in the way that the PC's Mike and Mary logic indicates. The Queensland Premier, Campbell Newman, says that $900 million in "savings" from public sector job cuts will allow an increase in disability funding. In the PC's thinking, presumably, the 14,000 public sector workers whose jobs were cut were all "Mikes". By losing their job, did they lose only $1000 each from their $150,000 annual income and still have $149,000 from other sources? The PC's logic only had to sound good on paper. Everyone knew that it would not work out that way in implementation.
The case of Queensland is clear. However, it is likely that other states will implement the NDIS "great idea" in a similar fashion. Without increasing the size of the economy with public infrastructure projects and other kinds of real economic growth, other states will only cut jobs, cut services and privatize public assets in order to pay for the NDIS.
Even in its reasonable-sounding Mary and Mike example, the PC shows that it has enshrined the thinking that all we can ever do is reallocate the slices of an eternally fixed pie. This is a major fraud, and is calculated to turn citizens against one another. The flood levy introduced in the wake of the Queensland floods in early 2011 has the same effect. Everyone pays a flood levy to "subsidise" those in high-risk flood areas. In addition, other infrastructure programs were delayed and industry assistance was cut to help fund the paltry $5.6 billion "investment" in flood affected areas. All they can do is reallocate the slices? The concept of human creativity and scientific ingenuity creating new wealth has been deliberately edged out of policymaking circles.
China's Three Gorges Dam has already saved hundreds of thousands if not millions of people from devastating floods. However, the eco-fascist lobby and aversion to infrastructure building in policymaking circles in Australia (and the influence of both is found in the PC) prevents anything like a Three Gorges Dam project from getting started in Australia. Yet a project in the vein of the Three Gorges Dam is immediately suggested by the tragic consequences of the Queensland floods of 2011 in the infrastructure-poor nation of Australia. The Three Gorges Dam is not an "environmental disaster". It is an environmental, engineering and human masterpiece.
The About the Productivity Commission webpage says:
The Productivity Commission is the Australian Government's independent research and advisory body on a range of economic, social and environmental issues affecting the welfare of Australians. Its role, expressed simply, is to help governments make better policies in the long term interest of the Australian community.
As its name implies, the Commission's focus is on ways of achieving a more productive economy - the key to higher living standards. As an advisory body, its influence depends on the power of its arguments and the efficacy of its public processes.
Yet the PC has never promoted heavy industry, never promoted nuclear power, never promoted building new power stations, never supported space science, never supported fusion research, never supported major water projects such as the Clarence River Scheme, Reid River Scheme or Fitzroy River Scheme, never supported magnetic levitation rail for Australia, never supported the opening up of new regions of Australia to agriculture. What about the Bradfield Scheme of the great Australian engineer J. J. C. Bradfield? What about the national ring rail and development project of the great Australian engineer Lans Endersbee?
Nay, the PC promotes the climate change fraud, privatisation and the supposed virtue of free markets. The PC pits Australians against Australians by defining the nation as a zero-sum accounting exercise, promotes the powerful interests who control markets (putatively "free" markets), and promotes the interests of private finance. Then it dresses it up in carefully proof-read bureaucratic-speak in terms that can be used on the floor of parliament with a minimum of political dispute. Politicians then jump on the PC's proposals as "safe" policies.
What could be more efficient than to set up a national bank that can issue long-term public credit to finance some of the infrastructure projects mentioned above? What could be more efficient than a fixed exchange rate and tariff barrier on strategic industries to ensure the stable long-term development of the nation's productive power? What could be more efficient than a Glass-Steagall separation between commercial and savings banking on the one side versus speculation and investment banking on the other? What could be more efficient than re-establishing the Australian Wheat Board single trading desk to allow farmers to focus on farming rather than fighting for survival against powerful international financial interests who speculate in and manipulate markets for food and other agricultural produce? What could be more efficient than working to establish new food-growing regions for low-priced food and food security for all Australians? The PC does not seem to be serious about what it says is its main focus.
Indeed, the NDIS scheme has bipartisan support (Tony Abbott media release 13th Apr 2012). Why would that be? Because it wears sheep's clothing. Ostensibly it is about disability support but most importantly it saves money which the Productivity Commission emphasises. What politician who wants to appear to be doing something would while achieving this apparent "win-win" outcome. To quote from the PC key points on the NDIS proposal:
From public sources, it would appear that the goals are:
This is in line with the thinking to date and the ideology of the Productivity Commission.
Cases where a severely injured person gets a $5m or $10m payout so they can live reasonably independently for the rest of their life will be a thing of the past. Such people will be "entitled" to support from the government. Clearly the screws will tighten on this support due to policymaking circles' illegitimate obsession with budget surpluses as if the government were a private corporate which must turn a profit to please private shareholders. Disabled people will have to work - perhaps selling Big Issue or what have you - to receive any support at all.
It's all about "productivity" - ultimately, austerity and some lives being labelled unworthy. It's also about being seen to be doing something while doing much worse than doing nothing.
There are major public finance, dirigistic, physical economic and infrastructure proposals that the PC has it within its power to propose. Clearly the PC was set up to play a different game.
Last updated: 16th Dec 2012