The Socialisation Of Investment In A Contemporary Setting

The Keynesian conviction is that capitalist economies are recurrently demand deficient, giving rise to both under-investment and under-consumption, which results in less than optimum employment growth. Keynes (1973: 378) believed that 'a somewhat comprehensive socialisation of investment' would be required for full employment to be achieved and sustained. Keynes left the finer details vague as to how a public investment instrument should operate. This paper attempts to flesh out more thoroughly, within an Australian context, how a socialised investment instrument could function. Superannuation policy is presented as an important tool for the socialisation of investment. The paper begins by arguing that for sufficient investment to ensure full employment, the socialisation of investment via superannuation funds should be employed. It then demonstrates, from a practical perspective how pooled employee funds could be used in the socialisation process. This includes (1) a policy to cap overseas superannuation investments and channel a percentage of total superannuation funds into a National Development Fund to be used for productive investment, and (2) a policy that would, in part, de-privatise employee pooled savings over the medium to long-term.