NEVER FEAR, QUANTITATIVE EASING IS HERE!

Russel Norman and his chums want the state to save capitalism from itself.

Green Party co-leader Russel Norman has often waxed lyrical  on 'the power of the market' ( his words) and dreams longingly  of  his environmentally friendly  capitalism.  But he now seems to have come to the   conclusion that 'the market' isn't as powerful as he thought it was  and that it is in desperate need of  a helping hand.  So the former socialist  has called for some 'quantitative  easing'  as a way of dragging the New Zealand economy out of the quagmire. 

And Friday's 'Jobs Summit' called by the Engineering,  Printing and Manufacturing  Union is another  recognition that the neoliberal orthodoxy isn't working. The  Jobs Summit will supposedly address the slump in manufacturing and the continuing job losses

Said EPMU national secretary Bill Newson: "The summit is a sign of the emerging consensus that the Government needs to take a more active role in the economy. No-one who has seen the mass redundancies of recent months, or the numbers of Kiwis heading to Australia, can be unaware of the deepening jobs crisis in this country and the need for a new approach."

Well, it won't exactly  be a new approach. What we will get are  some repainted and spruced up  'Keynesian lite' policies and past off as something else.

With the failure of monetarism to arrest both the financial crisis and the current trade depression Keynes has come back into fashion around the world.

However I'm not sure if one of participants in the 'Jobs Summit',  Labour's finance spokesperson David Parker, has suddenly discarded neoliberalism. After all, just last year, he told some business suits that neither  telecommunications and electricity generation were  considered by Labour to be 'infrastructure assets'  that ought to run in the New Zealand interest' and he has accepted that austerity measures are required.

But some of the participants at the Jobs Summit , such as New Zealand  Manufacturers and Exporters Association  chief executive John Walley , have been plugging Keynesian lite for some time, including at  the dear old Fabian Society - a think tank closely  connected  to the Labour Party.

Last year Walley presented to the Fabian Society a paper called 'Fresh Ideas for a Productive Economy' . In that paper  he called for action on the exchange rate, a capital gains tax and more investment in research and development.

We can expect these ideas to surface at the 'Jobs Summit'.

Mike Smith, a former general secretary of the  Labour Party, is president of the Fabian Society. A couple of years ago he wrote that the Fabian's 'progressive policies' were  'just about different ideas to run the capitalist economy'.  And that's what this 'Job Summit' is all about - a propaganda exercise to promote Keynesian-inspired  policies . These are the same kind of   policies that failed to prevent the rise of unemployment and prices and led to the neoliberal policies that have dominated for over three decades.

Keynes  won't sole this crisis and indeed advocating 'quantitative easing' is an admission that capitalism has essentially run out of policy options.

It would be nice of if someone at the Jobs Summit championed the interests of ordinary people and  advocated some socialist solutions   - like a progressive tax system and the  expropriation of  the commanding heights of the economy to serve the needs of working people. Oh, and how about a complete rejection of austerity policies? 

 Of course, no one will.  The message that the 'Jobs Summit' will be pushing, albeit subtly, is that  the state must save capitalism from itself.