Monday, September 22, 2008

Crony capitalism pays.

Just ask Con Makris, the rags-to-riches billionaire Adelaide developer.

The South Australian Labor government has just announced approval for Makris’ plan to build a new shopping and residential complex on a large vacant site at North Adelaide (below).

The site has been vacant site 1989, with various development proposals running foul of the Adelaide City Council’s planning regulations.

Enter Con Makris. He bought the site in 2001 and, like his predecessors, submitted plans that were obviously outside the City Council’s guidelines. Those guidelines placed a three-storey limit on new buildings; in 2005 Makris submitted a plan for a nine-storey structure including a "seven-star luxury hotel" (Makris' words), upmarket retail shops, apartments, cinemas, restaurants and a three-level, 1100-space car park below ground level.

Makris’ purchase of the site coincided with the election of the Rann Labor government. In 2002, companies associated with Makris began making contributions to Labor’s campaign coffers. Since 2002, Makris companies have made donations worth $261,150 to the ALP. The Makris Group was the second-highest contributor to the ALP during the 2005-06 state election.

Labor is a party of capitalism and always has been. In recent years, and especially under Rann, it has decided to abandon the restrictions imposed on it by the pretence of a social-democratic reform agenda. It has decided to openly commit itself to being a party of business and development, free of any pangs as to its “historic association” with the trade union movement and what might once have been a social-democratic agenda around health, education, public services and so on.

It is now unashamedly and unapologetically a party that badges itself as “pro-business, pro-growth and pro-mining”. It has set up a crony capitalist fund-raising entity called Progressive Business SA Inc. to sell its decision-making capacity to the highest ruling class bidder.

Makris is a trail-blazer in this development, a blazing neon name which shows what can be achieved by making the right-sized donations to the Business and Development Party, aka Labor.

In May 2007, the government awarded “major development status” to Makris’ North Adelaide proposal. This means that the deal would be fast-tracked, that all “red-tape” impediments would be swept aside.

But still the Council remained obdurate. They were not, as has sometimes been alleged, “anti-development”, but they did have a set of values around city planning that they did not want violated just for the sake of developer profits.

So Rann had to get them out of the way.

In July 2008, the State government stripped Council of its powers to approve developments costing more than $10 million.
In September, the government gave Makris final approval for a six-storey structure at North Adelaide.

Makris immediately denied that he had any political influence with Rann and his Planning Minister Paul Holloway. Speaking of his donations to the government, he said, “Everyone does it. This happens all over the world, it’s just not here.”

He’s right. It does happen all over the world of capitalism. It’s just that such blatant purchasing of political favours is regarded as corrupt in some parts of the capitalist world, whilst in others, it is the only way of getting things done.

SA Labor, which vigorously opposes the establishment in SA of an Independent Commission Against Corruption, has decided to embrace corruption through crony ties with paying sections of the ruling class.

The Opposition Liberals are no better.

The reality is that the system of capitalism, even in its cleanest and least corrupt manifestations, is a system of exploitation that needs to be swept aside forever.

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