It’s a Joyce, joke: Qantas is just capitalism doing its job properly

The Irish have been an oppressed people. They were also, as soldiers of the white imperial push, oppressors. So it seems allowable to say that Alan Joyce, that dementedly cackling leprechaun, managed to spirit his obscene pot o’ gold over the end of the rainbow, bejesus and begorrah, his maroon velvet top hat wobbling as he laughed and laughed, smoothing out his big green bowtie.

Yes, yes, he’s suffered the terrible fate of having to leave the company two months early, rather than hit retirement, the horror the horror. People close to this malign sprite say that he is devastated at leaving under a cloud, rather than being celebrated as the man who saved Qantas. Well, maybe. But that sort of thing has always sounded like school suspension: “You’re totally disruptive and you hate being here; as punishment, you can’t come in for a week!”

The trouble with all this spirit hunting is that it is serving as cover for the deeper structural problem, which any CEO of Qantas would have had to address over the period of Joyce’s tenure: it is a private company, whose officers have a fiduciary duty to its shareholders. Whether Joyce has fulfilled that well or badly, compared to what could have occurred, is another question. The point to make is that a private company has one purpose and one purpose only: to make a profit. 

That is the central paradox of capitalism that few can get their minds around. The actual activity of the company is a secondary effect. The essence of the thing, by use, becomes the contingent extra. At some point in the life of a large company, it must become the best possible fiduciary decision to do your stated purpose “badly”, with no regard for the customer. 

It’s easy enough to say, “Yeah, I know”. But clearly in the discussion over Qantas, some ghost of “public expectation” — a spirit of the bog, eh Alan — hangs over the carrier, some idea of a capitalism of public spirit. This refuses to acknowledge that a private CEO can consider “public spirit” only if it coincides with maximisation of return. 

This is an illusion that lingers in Australia, almost as folk memory, because our economy was a national capitalist one for so long, with the notion of some sort of social contract between heavily protected companies with near-monopolies and their customers. Look at any photo of a city street scene from the 1950s and ’60s, and you’ll notice the cars: they’re all Holdens. Bumper to bumper.

Such protection wasn’t a great deal in consumer terms, with higher prices, lack of range, innovation, etc. But it protected itself as a way of life by enforcing a certain idea of modest prosperity grounded in security: high, affordable home ownership, wage protection and the like. It enforced the famous great Australian boredom that so many exiles wrote about. But that image of it is self-selecting: many people liked it just fine. 

The series of privatisations unleashed by Paul Keating in the early ’90s, of which Qantas was one, was thus a piece of cultural engineering as much as it was economic. The claim was that such national companies, in a globalised age, were chronically undercapitalised, and that part private ownership would serve their long-term health. Keating, as many will remember, was big on this transforming Australia and Australians thing. 

His dissatisfaction with what Australians were was barely disguised. “Wimps are out,” he said once in a Four Corners interview. Since another word for “wimps” is “the meek”, this was a reversal of the secularised Christian impulse that underlies social democracy, a little touch of the Down Under Nietzsche that hangs ’round Sydney like sulphur in the air of a refinery town. 

Well, we got the world Keating wanted. Vigorous, thrusting, accumulative. But we also got what Keating doesn’t appear to have anticipated would occur (and which various recent statements suggest he might have got the hang of now): a dissolution of social solidarity that has made us one of the most functionally atomised societies in the world, yet one that still yearns for a lost collective purpose. 

Thus, Qantas management is expected to operate off a morality separate from their capitalist function, as regarding union contracts. That’s despite the fact that Qantas’ owners are overwhelmingly mum ‘n’ dad Australian shareholders, including many people investing their wages. This too expresses the cracked way in which privatisation was sold to us in the early ’90s: that we would have a chance to own a piece of the national carrier.

But we did own it, of course, all of us. Now some of us own it, and that is class structured. For all the palaver about ownership revolutions and democratising stakeholding, only a third of Australians own shares (separate to their superannuation holdings), and only 13% own more than $5000 in shares. Superannuation fund investment in Qantas is vanishingly small. Some cashed-up building and other workers aside, Qantas was gifted by Keating to the bourgeoisie, the portfolio people. 

But wait, it gets worse. The whole point of privatisation was to address the chronic undercapitalisation of state-owned assets. But Qantas has done what every large company has been doing in recent years, and which has greatly contributed to the slow stagnation of the West: it has been buying back its own shares as a way of placating shareholders otherwise denied dividends.

This hollows out the company and diverts reinvestment in plant or fare reductions, but maintains capital market confidence — so once again, its logic as regards capital is very arguable. Fail again, fail better, mint the blarney coin.

Thus it makes perfect economic sense to run a clapped-out fleet, with seething customers, using your too-big-to-fail power to exclude competition, and chance prosecution to list pre-cancelled ghost flights. The logic of capital dictates that any natural monopoly/half-of-a-duopoly, once privatised, will go from being the most ends/use-directed outfit (possibly highly inefficiently) to being the most cynical one; a parody of itself. That is the fate of Qantas over the past 30 years. To paraphrase the king: it’s a Joyce, joke.

In all this, the attention to Joyce’s remuneration has served as a useful distraction. The estimated $125 million he might have taken over his 15 years is eye-watering and ludicrous, but it has occurred during billions in losses, so it’s a drop in the ocean really. The size of it looks surreal if you think of it as a salary. But it’s a salary bonus/share vesting package, so once again, the capital relationship is obscured. It’s another expression of a desire for an enterprise of public spirit, for some spirit of it to exist, without the institutions that undergird it.

Did Joyce have to run Qantas this way, in capitalist terms, to steer it through the past decade which saw the crash and crisis of numerous national carriers, even before COVID dealt many a final death blow? Joyce and his gang can point to the collapse of airlines that were once fixtures of international travel — Avianca, Alitalia — to argue that his success is measured by the fact that Qantas is still here at all. 

That is, of course, the government’s reason for giving Qantas whatever it wants. Or one of them. The faintest chance of it crashing and having to be directly run, and the disruption if such occurred, must have ministers waking up screaming.

For a Labor administration, this is not least because industrial relations would then occur directly between government and unions. With the TWU as a major player, this would put its MPs in a major contradictory position and destabilise factional deals. The Albanese government will ship shrink-wrapped cash blocks on pallets to Qantas before it will let it collapse. (M’colleague Bernard Keane will be addressing the aviation green paper, which dropped today, sometime before my hour of rising. One would be very surprised if it proposes any real alteration in Qantas’ position, or any deeper consideration of what aviation in Australia is.)

The airline’s too-big-to-fail character points to another distinctive feature. National carriers in Europe are partly for nationalist purposes: no one in Luxembourg actually needs Luxeair. The US, China and other large countries have sufficient populations to support the industry under any circumstances. For us, airlines are not just national carriers; they are a form of public transport, and that is how they were always understood.

Qantas’ yield in dividends and buy-backs to a privileged slice of Australians has been based on that guarantee. It has thus been a vast transfer of national capital and control sustained over decades, predating Joyce’s arrival. I have no idea whether he has managed the thing badly or well, in capitalistic terms. But the assessment of whether he has managed it well in social terms has no bearing on that judgment.

There is some irony in the head of an airline not anticipating that it might all go wrong as he comes in to land. That’s when most crashes happen. But has this concentration of bluster, blarney and gold-potting served to make clear the necessarily public and social character of a national carrier on a sparsely populated continental nation-state? 

Well, maybe, a little. That has certainly started to occur. But questioning the rights of the private sector has been driven more by the profits of Coles and Woolworths, amid rising prices and increased margins, than it has by the travails of the flying kangaroo. Some vague notion of profit controls got a float before drifting away again. Qantas’ lurch between vast losses and profits, wage-stripping and bastardry to consumers obscures the imperative that such an airline should be socially nationally owned, and respond to multiple and competing imperatives. 

The overwhelming complex of these would be: that the carrier provide affordable national travel, and part of its current international travel roster, at a certain volume based around some idea of essential travel and with concession rates for health care card holders, the same as state rail offers.

The overall management of the carrier’s size and offerings would have to be considered in relation to net zero targets — any socially run airline would have to be, in part, in the business of diverting travel to rail, or to non-travel, and the conduct of numerous pointless business meetings by Zoom, rather than the ceaseless high-volume ricochet between Melbourne and Sydney. 

That would require management by a board composed of different social representatives — consumer, worker, Australian citizen — with the state still occupying a regulatory role. Such a process is entirely at odds with a privately owned corporation.

Not part of the public imagination yet, but your average flight is, for pilots, hours of unchanging boredom with five minutes of intense drama at each end, so who knows how things might go as the global economy encounters fresh turbulence?

Too late for the liddle feller though, as he slides down the tailfin rainbow to land headfirst in the clover. Will he take his final bonus? Ha. Yes, he said, yes I will. Yes. Bejesus and begorrah.