Transcript - Pod on the Hill



SUBJECTS: Inequality; Banking Royal Commission; Corporate Governance; Industrial Relations; ALP Membership; Australian Republic; Global Financial Crisis.

STEPHEN DONNELLY: Hello and welcome to another episode of Pod on the Hill, Australia's only weekly Labor podcast where we discuss the political issues, events, people and campaign activities from home and abroad. My name is Stephen Donnelly. Remember, Pod on the Hill is available every week on iTunes, SoundCloud, Stitcher and your favourite podcast app. Now the Victorian State Election is well underway and Labor is campaigning hard to re-elect the Daniel Andrews Labor government. Our field organisers are now organising in communities right across regional Victoria and metropolitan Melbourne. And if you want to get involved in our grassroots campaign and join other volunteers in the Community Action Network, sign up at If you have any questions to send to us for the show, don't forget you can e-mail us at 

Earlier this year the former Labor Deputy Prime Minister and Treasurer announced that he would not recontest his seat of Lilley at the next Federal Election and rightfully spend more time with his family and hitting the waves. He's had an illustrious career in politics, and before he leaves the nation's capital, he's got plenty to offer. And it's great to have him on the show today. Wayne Swan, welcome to Pod on the Hill.

WAYNE SWAN, MEMBER FOR LILLEY: Good to be here, Stephen.

DONNELLY: So let's get into the really serious issues right from the get-go. Describe the first time you heard the music of Bruce Springsteen. Where were you? What was the song or album and what got you hooked on The Boss?

SWAN: I was in Mitre St, St Lucia, which was a house down the road from the University of Queensland, and it was sometime in ’74, ’75-ish – I think I'd have to go and check that. And as was our wont, playing music late into the evening in the early hours of the morning was a pretty frequent occurrence at my street. So that's where I was, I was 19 or 20. And it just seemed such a such an anthem, I suppose – the first album was really Born to Run that I got into, but I got into the earlier albums around that time. And I've been a big fan ever since then. But it's not just Springsteen. I mean, Led Zeppelin and all of those bands of the late 60s, early 70s. I saw Robert Plant at Bluesfest this year, along with a lot of other lot of other great artists. So following The Boss has been a passion, but it's not been my only one. When it comes to rock’n’roll, Australian rock'n'roll is something I really enjoy. I was into Barnesy pretty early. And of course, I've had I had a daughter who has been in and out of bands. In fact, all of my kids play music in one form or another. They grew up listening to Neil Young; I'm a very, very big Neil Young fan as well, and saw him when he was out here a few years ago.

DONNELLY: The Harvest album by Neil Young is one of the quintessential albums that you'd need to have in your collection, otherwise it's not actually a full collection, is it?

SWAN: That's true. But there's so much of Neil Young. There's the early Neil Young; there's the really hard rock Neil Young; there's plenty of Neil Young. I suppose there's plenty of The Boss as well. He's morphed into different sort of strains over the years, but you know his Wrecking Ball album, I think, is a very signature album for the times and had a bit of an impact on me, much like Born to Run. Society was in a very big transition back then. I mean, he was singing about the decline of manufacturing in New Jersey and the plight of the working class. And of course the Wrecking Ball album came out just after the financial crisis, with some fantastic music reflective of the times.

DONNELLY: You’ve just taken one of my questions! I was going to say that obviously the Born in the USA album and a lot of albums that came out of the mid‑80s was very much influenced by Reaganomics and the pressures that were put on the working class in the United States. Has Bruce Springsteen reinvented himself, or is his music as relevant as it was in 1980?

SWAN: There’s no question it’s as relevant. And in fact you can see it when you look at the audiences. There's people like myself, but there's lots of people in their late teens and early 20s. But there are so many good artists around. It's interesting at the moment that the sort of political ferment and polarisation that we're seeing in politics, and the splintering is, I think, producing a wave of very good writing in literature, but I'm not so sure it's yet been fully reflected in in the sort of music that I follow. But it certainly made a lot of the golden oldies even more relevant.

DONNELLY: I’ve asked other politicians that have been on the podcast about Australian music. Is it fair to say that we lack enough artists out there that have political messages through their music? And if that's true, then why is that the case?

SWAN: Well I don't know that it's fair to say that, but I think it is fair to say that that music isn't transmitted the way it was. And like many messages and movements in our society, they’re much more diffuse and sometimes harder to get to. And it seems to me that with the advent of social media and the internet and so on, there's a lot more out there, but sometimes we miss some of the really good stuff. So I don't think it's fair to say that it's not there; it would be fair to say that I'm not as familiar with all of it as I should be! But that's something I want to rectify, because one of the things I do want to do is just to have more time. 

I love being a politician; I love politics. I'm getting out of Parliament, but I'm not getting out of politics. But one of the things I want to get, by getting out of Parliament, is more time. More time to do the things that I love: more time with my family, more time to go to concerts to take in music, more time to go surfing, more time to catch up with old friends. The sort of things that you don't have the time to do when you're tied down – as you should be – to an electorate and to a whole lot of very formal positions.

But I am going to keep my hand in politics, because I very much want to stay involved in the ideas debate and I want to, in some ways, lead that ideas debate. I think I've played a pretty constructive role since 2013 when I resigned as Treasurer, in challenging the Party to face up to the big issues of our time. And the big issue of our time, apart from climate change, is growing inequality. And that's what I want to do. Funnily enough, staying in Parliament probably is one way that was inhibiting me from doing more in those areas.

DONNELLY: You've spoken a great deal about the fight against inequality and the battle of ideas and you co-chaired the Inclusive Prosperity Commission that was done by the Chifley Research Centre. What were the top-line findings of that Commission? What drives inequality and how do we address it going forward?

SWAN: Well there were two reports – one was the Chifley report; the other was one I did with the Center for American Progress. In many ways, they're both similar. The first one was the one from the Center for American Progress, which started with the lead paragraph that said: “Growing inequality in income and wealth threatens our democracy.” And it does. And that has become more evident every year since that report and the Chifley report were produced. It's a growing concentration of wealth and income, forced by policies which are backed by powerful vested interests that do not have the economic interests of working people at their heart.

It is a deliberate choice of trickledown economics which is driving some of the politically-inspired inequality that we're seeing around the world. Other parts of that growth have got to do with technological change and some other factors which are hard to control from a public policy point of view, but trickledown economics – the policy of giving tax cuts to the rich and large corporates, deregulation for the powerful, smashing up social safety nets and wage suppression for everybody else – has produced an acceleration in the trend of inequality: a massive concentration of wealth and income at the top, the hollowing out of middle classes and the creation of vast armies of working poor.

And we see part of those trends reflected here now, particularly in the growing insecurity and casualisation of our labour force.

DONNELLY: So there are some of the factors that drive inequality. You talk about this battle of ideas; talk about the ideas that we need to have to address that.

SWAN: If you just look around at what’s happening at the moment – everything we're seeing at the Royal Commission into Banking – basically, you've got billionaires and their lobbyists controlling the Liberal Party and trying to implement policies which result in wealth and income concentration. We've got probably the most extreme trickledown government we've ever had. I never thought I'd say that we'd have a government that was more extreme than the one led by Tony Abbott, but we have! The one led by Malcolm Turnbull is more extreme than Tony Abbott, because his centrepiece policy is classic trickledown. And as we've seen this unfold at the Royal Commission into Banking, we've seen the sort of obscene justification of all of this, and the validation of all of this by what I would regard as an overpaid and overpowered financial elite, who've been completely out of control and running a con job on the rest of the country for some time.

DONNELLY: How have we got to this stage? There was an article I was reading this morning by Ian Verrender on ABC Online; he was suggesting that ASIC has gone missing in action over the last decade and he's pinning it on them a little bit. Do you agree?

SWAN: I don’t think ASIC’s the main cause. There's no question that there are regulatory failures, but lying at the core of this is an attitude problem. I think we are controlled by a pretty powerful corporate elite who are overpaid, have an incredible entitlement mentality and suffer from a blindness of affluence. 

What I point to, when I look at this, is the fact that the private sector is 75 per cent of the economy. If you go to the people who run the private sector, that's all the people who sit on their boards – now ultimately the boards are accountable for the behaviour of these companies, in this case in the financial sector.

I pulled out a figure when I addressed the ACTU Conference last year. I had a look at the ASX 200 over a 10-year period and found that, during that period, there were over 1000 directors of the ASX200 and only 15 had ever been dismissed.

Now if you had an outcome like that in three-yearly elections over a 10‑year period people would be saying “democracy is not working.” The truth is that that Board Australia is a game of mates. And many of our largest companies are controlled by the old school tie – the old school girls and the old school boys – and they have let an overpaid and overpowered financial elite do virtually what they like, irrespective of the regulators. 

Yes, there are failures of regulation here, but we've got to drill down. It all comes down to greed being king. That essentially, this concept – which is at the heart of trickledown economics – that if the private sector is unfettered from any form of government control, it will be the successful wealth creator and job generator of the future. And we're seeing the evidence of how flawed and inaccurate and how damaging this concept is – the concept that there is no responsibility from any company, other than to maximise its profits. What has happened is that corporate Australia has since has essentially decoupled from any sense of community, or responsibility to community.

DONNELLY: How does Malcolm Turnbull's government come out of this in terms of their reputation within the voting population? For a long period of time, they were voting down – 20 or 25 times they voted down – the opportunity to allow this Royal Commission to occur, and now they're walking back their position on it after the events of last week.

SWAN: Sure. Well they have voted against it 23, 24, 25 times. But they only changed their mind when they were told to by the big banks! And everyone knows that to be the case. So this is why I say that this is one of the most extreme, or probably the most extreme, trickledown governments we've ever seen.

DONNELLY: What's the future for workplace relations in this country if there's this sort of increased wage inequality and the serious deterioration of workers conditions? You would think that the answer should be join your union and get organized. Yet you see membership continues to fall, and we see companies now breaking collective agreements and reverting back to the award structure.

SWAN: Well we've got a very assertive and aggressive corporate sector at the moment, which has brought the American-style attitude to industrial relations into the workforce into this country. And part of the battle our government had, during the period of Rudd and Gillard, was dealing with these very aggressive big corporates who thought they could come to Australia and do whatever they liked. 

The big difference here in the first instance is symbolised by our minimum wage of $18; they’re somewhere between $7 and $9. And that's about all they have in terms of effective regulation in most cases. So they've come here and have been very, very aggressive. 

There's a variety of responses to this. There are a variety of responses in the institutional framework of the industrial relations system. But that alone will not bring about fundamental changes we need. The fundamental changes we need will require big changes to corporate governance, the like of which I was talking about before. How are boards selected? How do we have boards looking more like the institutions that they're running, rather than the old school brigade from the North Shore of Sydney or the elite suburbs of Melbourne? How do we ensure that boards are more accountable? How do we ensure that the obscene executive pay that is the ultimate consequence of the sorts of practices we've seen unveiled at the Royal Commission – what do we do to put in place better controls on executive pay? 

When I was Treasurer, I put in place a proposal called the two-strike rule, which has had some effect, but we've started to see executive pay move up again, back to the levels that we saw prior to the Global Financial Crisis. So there needs to be new rules about how boards approve executive pay when those proposals go to their shareholders. So I see a big reform agenda needed – not just in industrial relations, but also in corporate governance. 

And then to move on and go further, it's not just a question of union voice. We need to see worker voice more reflected across the board – and that may well be union voice in terms of boards of companies, but more generally in the pillars of the establishment of our community: on the Reserve Bank, where they used to be. Right across our society. On the board of the ABC. You can go on and name a whole string of bodies. I think it's going to require quite a fundamental power change. We've got to redress this power imbalance that corporate Australia has used to drive it's disconnected from just connected from our community and to take the lion's share of the product of our economy.

DONNELLY: And I know you don't have a crystal ball, but where do you see this Royal Commission ending up into Banking?

SWAN: Well it's I think it's got a long way to go. I think the events of the past week would indicate that it's not going to finish on its existing timeline.

DONNELLY: Talk to me a bit about your thoughts about the Party. You've been in the Party for a very long time, and obviously before you were the Member for Lilley, you were a Party official. If you had a magic wand that could bring about change to the Party as you saw fit, where would you start and what would you do?

SWAN: I think the most important thing is we've got to get out there. We've got to excite our grassroots membership with ideas, and that is far easier said than done. Every Party official who has come into the job has always come in with the best of intentions about trying to expand membership. Many of us have run many membership campaigns over the years. Some have come and some have gone. 

There has also been this tendency, in terms of Party membership, that Party membership builds as we come from opposition to government. There is great excitement; we come to government; then there tends to be disillusionment. People see governments take decisions that they may not like or they don't agree with, or they don’t necessarily they think that the Party is operating effectively. 

So I think we've got to do, at a variety of levels, a better job of exciting people about our ideas. I think we've also got to do a far better job of working with our membership when we’re in government. 

I've been talking to members around the country, and I won't name the state, but a Party member said to me just yesterday, in country Australia, that state Cabinet Ministers come past here all the time and they never drop into the branch. So I think our governments, our Ministers and our senior officials have got to be far more cognisant of what I'd call the development of a set of ideas, which excite people and take them with us, so that they feel a big stake in what we're doing. And they should feel like they've got a big stake, even when they might be on the losing side of a particular policy argument here or there. 

But I also think that the times have changed. The times of have changed, because people can clearly see that we have very aggressive institutions on the right side of politics. Essentially in Australia, the Australian Liberal Party has become effectively the Australian Tea Party. The radicalisation of the right in Australia is the big story, I think, in the last 20-odd years of politics. We've stayed pretty much round our centre-left ideals and policy frameworks, but they've raced off into nutter land. 

And if there was ever a time when we should be able to grow our membership, it is by standing our ground on policies which are pretty much centre-left to middle-ground policies, but look far-left if you're reading the Murdoch press, when the rest of conservative Australia is over there in climate change denial and arguing for working people to bear the whole tax burden, which is essentially where we've got to. 

So there's a very clear choice now in Australian politics. We've done, I think, a very good job in recent years of staying centred on the big ideas that matter. We did that in government and we're doing it now. We did it on climate change. We did it in our response to the Global Financial Crisis. We did it with the NDIS. We did it with parental leave. We did it with the biggest age pension increase in the pension’s history. We've done a lot to put a flag in the ground and say that modern Labor is very firmly planted in social democratic principles. But the conservatives have gone batshit crazy.

DONNELLY: In Europe and the United States we've witnessed a rise in various forms of nationalism and nativism, populism, and social democratic parties are really struggling at the polls. Are these warning signs for us here in Australia or not?

SWAN: Too right they are. And as I move around the country, that's what I say. I mean around the world in the last decade, social democratic parties have disappeared in the blink of an eye. And that fate could await us as well. It's a much more diffuse environment. Politics is no longer communicated directly through families over generations. Everything is much more fluid. So there's even a greater urgency and responsibility on our part to deal with these issues of keeping people plugged in, keeping them interested and keeping them inspired. But I think more than anything else we've got to be talking a language which inspires our people as it did when this Party was formed in the 1890s.

DONNELLY: We recently had the Commonwealth Games in your home state of Queensland and with these events and regular Royal visits it tends to stoke the fires of Australian Republicanism. Next year marks the 20th anniversary of the failed referendum in 1999. Are we ready for another debate on who should be our Head of State?

SWAN: Well we've got to keep plugging away. I'm not sure whether its time has come just yet, but if you would have said the same thing about marriage equality five years ago, and said it was going to come as quickly as it did, some would have been skeptical. So I don't think we should in any way give up on it. I think we should be out there talking about it and be enthusiastic about it. But whether we can get it through in that time, I don't know. But I know that there will never be a shot getting it through if we don't try. There's a much more fluid environment. At the moment it's weighed down by a lot of this sort of schmaltzy stuff about the young Royals and so on. But you know, all that can change pretty quickly too.

DONNELLY: On the announcement that you won't seek re-election for Lilley, Bill Shorten reflected on your role as treasurer during the Global Financial Crisis saying that, talking in third person, "his skill and his belief in inclusive prosperity meant that the Australian economy didn't just weather the global storm, it actually grew and businesses stayed open. Australians stayed in work. Families stayed secure." How is Labor's economic record regarded globally after the role that you played in that government?

SWAN: Oh I think people around the world look at what happened in Australia with admiration. It's a very good example of the application of Keynesian economics in the best traditions of social democracy or social democratic parties. We moved swiftly to protect our people when they were threatened by a global recession. 

For a while there, that recession was going to become the Great Depression Mark II. Australia led the way with the design of our packages and we had the best outcomes virtually of any developed economy in the world. And it's one of the reasons, for example, our economy is now about 30 percent larger than it was at the end of 2007. We avoided the terrible destruction of high and long-term unemployment amongst so many of our people, which leaves lasting scars in other countries even as we speak now and is holding back economic growth in those countries. 

It's a pity that the conservatives in Australia opposed us so vehemently on it. But yet another demonstration of why modern Labor is a successful political and economic force and why we've got such a proud record to take forward as we meet the new challenges which are coming from rampant global inequality and growing inequality at home, which is being driven by such powerful vested interests such as our big banks and the multinational companies that never want to pay any tax. 

DONNELLY: The global economy – if it's truly out of this great recession, why is growth so slow right now?

SWAN: Well I think that we have seen a prolonged stagnation in the global economy since the since the Great Recession as it's known overseas. It had such a huge impact that it was the equivalent of the German economy simply being wiped off the face of the earth. So many of the other economies that are now growing haven't yet fully recovered from the loss of production that occurred during that period. And even in the United States, where there is a faster recovery there now than there is here, and a lower level of unemployment, the job destruction that is reflected in labor force participation rates is still a drag on their economy. 

So I don't think anyone can necessarily say that we're out of the woods. There is a stronger global economy happening now. It's one of the reasons why our economic position ought to be a lot better than it is, because we had the headwinds of a Global Financial Crisis, a high dollar and high interest rates for most of our time in power. 

These guys, the Libs, have got a lower dollar, lower interest rates and have not done all that well over most of their time in government. So a good record on the economy. And by the way, the Australia Institute polled these questions last year. Of course, if you pick up any Murdoch newspaper, they'll tell you that Australians regarded the stimulus as a waste of money. Bullshit. Australians do regard our steps and actions during the Global Financial Crisis as being absolutely essential and understand they were some of the most effective in the world. But the conservatives always try and wipe that out of the conversation and continually go back and demonize our actions during the Global Financial Crisis as a way of trying to walk all over our political traditions and our values. 

DONNELLY: Anika Wells, a young lawyer, is replacing you as a candidate for Lilley in the upcoming election. And I want you to cast your mind back to when you first put your hand up for the seat of Lilley and the expectations that you had as a person going in to represent the Labor Party in public office. 

As a campaign practitioner, my job is to get people what you elected and I see a lot of people go in with great ambitions or thoughts about what it is to be a politician, but then get in and see the job isn't what they first expected. What were your expectations going in, and with that in mind, what advice would you give to someone like Anika going into the job now? 

SWAN: Well, stay focused on your electorate. I got in in '93 and I got and I got knocked out in '96, so I had a pretty rocky start to what was going to be my political career. But I think it taught me to be a better politician. 

I lost my seat in '96 and if I needed any reminding of how important it was to stay close to, and to always work very, very hard at, the local level, then it was the events of '96 and my return in '98. 

So I always was incredibly focused on staying very true to my electorate, on listening to what they said and on fighting for what it needed. And that did play a role in terms of my decision to announce my retirement. I mean, I probably could have done another term but I thought it was very important to get someone settled into what is effectively quite a marginal seat, to get them settled early. 

And I thought it was really important that we got a young woman. We've got three young women across Lilley, Dickson and Petrie. If they're all successful and we hold all our other seats we'll meet our 50 per cent affirmative action target in the federal caucus.

DONNELLY: Which is amazing.

SWAN: Which is amazing. But importantly it taught me that you can't, in any way, ever take the electorate for granted. And it also taught me, after losing a seat in my first term, that making sure that whoever followed me had the best possible start the whole of the seat had to be an important part of the decision-making I was taking about what I would do with the rest of my life. 

DONNELLY: What won't you miss from the job and what will you miss on the job? 

SWAN: Oh I'm going to stay very much involved in the ideas debate, through our think tanks and whatever other means are available. And I'm now working on international tax with non-government organizations as well, so there's plenty I'm doing there. I'm very fond of my local community and I'm not moving out of it. We're not going anywhere and I'll stay involved. 

But what I'm seeking to have is more time at home and more time as we're saying before doing the other things that I love. So I'm going to swap those things for the really interesting electoral work that you spend doing, being out at meetings night after night and all weekend. I'll be getting a few of my weekends back, and a few of my nights back at home. 

DONNELLY: Everyone's talking that there's going to be a federal election this year. What do you think is going to happen in terms of this one-term government?

SWAN: No one would know. The government's out of control. I mean, you've got a Prime Minister who devised the insane strategy of having a double dissolution election over two months. So he's quite capable of taking any decision.

DONNELLY: And you're not a betting man. But do we have the prospects of a Shorten-led Labor Government?

SWAN: Of course we do. But on this occasion we're going to be fought even harder by the powerful vested interests that are cashed up and controlling the government. So I don't think any Labor supporter out there should think that, because we nearly got there last time, it's absolutely inevitable we get there this time. 

We're a very good shot, but I can tell you what we're going to see a lot more big money and big power and real extreme scare campaigns run by the conservatives, given everything else that's been going on. So everyone's got to brace themselves. This is going to be a big, tough battle.

DONNELLY: It is, and we need every single volunteer to be absolutely out there, making calls, knocking on doors, right across the country. And I'm sure that you'll be out there, doing your bit as well.

SWAN: We've already started the campaign in Lilley.

DONNELLY: I do not doubt that at all! One final question before we wrap up. You gave a lecture, the John Button lecture a while ago, and it was titled Land of Hope and Dreams, and obviously it was a reference to a song from the Wrecking Ball album of 2012. What do you perceive as the land of hope and dreams for Australia going forward?

SWAN: Unquestionably, the really big challenge for Australia is getting decent, rewarding work. We're all about people with secure jobs that have got a future. That's never been more under threat than it is now. Because people talk about a low level of unemployment overall, the headline rate – we've got some of the highest underemployment that we've ever seen in the history of our country. 

And the whole arm, every arm of government policy in this country, particularly given the challenge that is flowing from artificial intelligence and other technological changes, means that we've got a really big task on our hands to construct a set of economic policies that are mutually reinforcing and produce the job outcomes that so many of our people aspire to, but so many of our people are not obtaining at the moment.

DONNELLY: Well Wayne, we thank you for taking time out of your hectic schedule and coming to have chat to us at Pod on the Hill. We wish you the best of luck with the remainder of your time as the Member for Lilley, and also the contributions that you continue to make to the party going forward. 

Before you go, you need to choose a song to end this podcast. I've probably put you on the spot there – I'm not sure if your office told you about that, but I'm sure you can think of something. What song, and why would you choose it?

SWAN: Well I think we ought to do Land of Hope and Dreams.

DONNELLY: I can't think of a better way. Wayne Swan, thank you very much.

SWAN: This train, it's comin'. Thanks Stephen.



For the full recording, go to:


Authorised by Noah Carroll, ALP, Canberra