Category: Politics

  • John Menadue. The war on asylum seekers

    For political purposes the government has deliberately embarked on a policy and a language to militarise the asylum seeker issue in the same way the Howard Government did in the “war on terror”. It is designed to highlight the government’s resolve, to play to our fears about a threat and to lessen our rights to be informed. Failure to disclose is justified because we are ‘at war’.

    But the ‘war on terror’ and the so-called ‘war on asylum seekers’ would in fact be much better conducted by police, customs and our intelligence services.

    In this misuse of the military and language for political purposes we should not be surprised if a two-star military general is drawn into the political fray. Neither should he or his colleagues be surprised if they also get caught in political flack.  If they are in the kitchen, they can’t complain about the heat!  The military has crossed the line before. General Cosgrave showed that he was an enthusiastic supporter of the Howard Government in forcing Tampa to transfer the asylum seekers on board. He will now be our Governor General.

    Senator Conroy has been criticised for saying that General Angus Campbell, the Head of Operation Sovereign Borders, has participated in a ‘political cover-up’. In my view that is precisely what the Government and General Campbell have done. The military has been manoeuvred by the government into a role in the coordination of government agencies, most of them civil agencies like immigration and customs. To avoid public examination, the Minister Scott Morrison and General Campbell keep hiding behind the parroted phrase ‘on-water matters’. This is a political cover-up in which the military has become involved. That cover-up should be called as such.

    The Coalition has been quite clear in its language that it is at war with asylum seekers and people smugglers. Scott Morrison has described Operation Sovereign Borders as ‘a military led border security operation’. Tony Abbott has spoken of a war against people smugglers. In the first week of parliament Scott Morrison said that ‘The battle [against people smugglers] is being fought using the full arsenal of measures’.

    In war situations, the withholding of information can be justified. But surely we are not at war against unarmed people in rickety boats.

    Just consider what we heard last week in Senate Estimates about Operation Sovereign Borders and the cover ups.

    • Under the charade of ‘operational security’ the Defence Force Chief, General David Hurley would not confirm that orange lifeboats had been used. He replied ‘That is an on-water issue’. Yet we have all seen the orange boats on TV time and time again.
    • Asked if the lifeboats were Australian-flagged, Hurley responded ‘We can’t comment on on-water issues’.
    • Asked if the lifeboats were navy assets, Hurley replied ‘They are an on-water issue’.
    • Asked if there was general training for navy personnel in the handling of the lifeboats, the Chief of the Navy, Ray Griggs, said ‘If I talk about training then I would be going to “on-water matters”’.
    • How at least six Australian navy vessels intruded into Indonesian waters was a matter of ‘on-water operations’. Undoubtedly the crew of the navy vessels will be censured, but not General Angus Campbell who is in charge of OSB. That would be politically embarrassing because he has become the point man in the government’s cruel policies and the cover up.

    When public policy becomes militarised like this, no-one, including the military, can hide behind trumped up excuses, time and time again about ‘on-water issues’.

    How out of proportion this has all become. The plight of vulnerable people has become a highly politicised and military issue. This is a humanitarian issue which must be handled with firmness, but that does not mean that the military should be leading it. We also need the truth rather than senior officers and military leaders using lame excuses. We have seen too many other instances where the performance of the military, particularly at the Australian Defence Force Academy leaves a lot to be desired.

    Senator Conroy was much closer to the truth than his critics in the Canberra press gallery who so often see parliamentary events through a party political prism only and seems oblivious to the wider and more important issues of policy and principle.

  • Michael Sainsbury: Are Chinese leaders cleaning up or cracking down.

    In April 2009 Dr Fan Yafeng was sacked from his job as a legal researcher at a prestigious think tank, China Academy of Social Sciences.

    It’s not that he was no good at his job – to help the country’s government formulate its constitutional and religious policy. Rather, it was that he was an openly proselytising Christian, a member of a Protestant house church and signatory of Charter 08, a manifesto calling for fundamental changes in China including an independent legal system, freedom of association and the elimination of one-party rule.

    Fan was sanguine about this turn of events when I met with him a few weeks later. Sadly his optimism was misplaced. In December 2010 he was detained by police and eventually released into “house arrest”. Since then none of his friends have been allowed to speak to him, and he has no telephone or internet access.

    Fan was a victim of the increasingly tough “social stability” policies of China’s Communist Party, instituted under past leader Hu Jintao – who cut his teeth quelling riots in Tibet.

    Since Hu was replaced in 2012 by Xi Jinping, a man feted around the world as an economic reformer, the environment for independent-minded Chinese keen to improve their country has actually deteriorated.

    In almost three years Fan has not been charged with any crimes, yet he is treated like a criminal, stripped of any right to associate or move freely. He remains trapped by the state, in a particular form of hell.

    Fan is but one example of countless people across the country who have the temerity to stand up for their beliefs. They are under one of many forms of house arrest, Fan’s being one of the most severe, held in custody for months and sometimes years on end, or put on trial in a system where rule of law is a joke and secretive Party committees tell judges how to act.

    When Xi ascended to the country’s top job, Secretary General of the Chinese Communist Party, he promised to end the endemic corruption that he and his predecessors have said is the biggest threat to the Party’s future.

    Xi also cut the number of people in the very top echelon of leadership, the Party’s Politburo Standing Committee, from nine to seven, in the process removing the Party’s top security chief.

    At the time, these moves were seen as encouraging and Xi, together with Wang Qishan, a widely respected Politburo member who was named chief of the Party’s Central Discipline Committee, has waged an ongoing battle against corruption inside the party.

    Extravagant gifts and banquets have been banned and – living up to his promise to get “tigers” or senior officials, as well as “flies” or junior cadres – many senior officials have been arrested.

    Yet the campaign against Party corruption is increasingly seen as Xi crushing dissent to his rule inside the Party. Among those arrested is former Politburo Standing Committee member and security chief Zhou Yongkang, along with many of his inner circle, most of whom were senior executives in State Owned Enterprises in the energy sector, removing one clique presumably to be replaced by another.

    Zhou was close to Bo Xilai, a disgraced and jailed former Politburo member, leadership aspirant and one-time colleague of Xi’s.

    Just how truly self-serving and hypocritical Xi’s anti-corruption campaign has quickly become is writ large in the case of Dr Xu Zhiyong, a “rights defence” lawyer, known in Chinese as weiquan, who is now serving a four-year jail sentence for “gathering crowds to disrupt public order”.

    I met Xu, a sharp minded, friendly young lawyer with a PhD in law from Beijing University, in 2009 only days before his previous arrest on dubious tax evasion charges directed at the organization he then ran, the Open Constitution Initiative. Despite being bundled into a car after a knock at his door at 5pm on July 29, 2009 and kept in detention for almost a month, Xu was undeterred.

    After admitting to the tax charges he was released – some reports claim after pressure from US President Barack Obama during his visit to China – and he began working away on a bigger project, the New Citizens Movement, that he founded in 2012.

    Of his trial Professor Jerry Cohen, one of the world’s experts on the Chinese legal system, said this in the South China Morning Post on January 29:

    “Was Xu’s trial ‘in accordance with law’? Certainly not. In many respects, it violated the ‘law’ – but not the practice – of China. Indeed, it made a mockery of the recent speeches by President Xi Jinping and leaders of the Supreme People’s Court emphasizing the need to prevent further wrongful convictions by requiring verification of evidence in open, fair court hearings.”

    While Xu is perhaps the most high profile case of the increasingly rough justice meted out to those the Party fear, he is far from alone. Scores of people have been rounded up under Xi and there is now no doubt that censorship has been ramped up and “dissent” is being crushed ever more ruthlessly from every angle.

    There is a method to the madness of the Chinese “justice” system. Organizations with strong and often opaque networks that run across provincial and social/economic lines, with networks that may be co-opted for political purposes, reduce the CCP to a state of paranoia.

    This is why religious organizations and those who promote them like Dr Fan continue to be targeted. The wildly popular, and ultimately too well organized, quasi-religious Falun Gong with their penchant for mass meetings, was another to fall foul of the CCPs fears.

    Xi and the Party’s aim in targeting people like Fan and Xu is not a Maoist-style pogrom, it’s just the latest in a long line of bullying tactics meant to enforce the primacy of the Party and increasingly, the powerful families – such as his own – whose interests are now intertwined with the organization. The age-old mix of money, power and politics have lead many observers to describe China as a “mafia state”.

    In a new book, exiled Chinese writer Yu Jie has taken this to its logical conclusion. The man who ridiculed former Chinese Premier Wen Jiabao in his 2010 book Wen Jiabao – China’s Greatest Actorhas turned his pen to the current leader in a new book Godfather of China, Xi Jinping.

    The New York Times recently reported that one Hong Kong publisher, Yiu Mantin, was arrested while on a visit to the mainland late last year and subsequently declined to be involved in printing Yu’s book in the supposedly independent city, while a second has abandoned plans to publish after threatening phone calls.

    You get the idea.

    Michael Sainsbury is a freelance reporter who worked for five years in China with The Australian and now writes for www.ucanews.com. 

     

  • John Menadue. The Carbon Tax and Flat-Earthers.

    Despite all the political rhetoric and hysteria, the evidence is mounting almost daily that the carbon tax is largely working as planned and that its impact on electricity prices is quite small, particularly compared with the ‘network costs’, the poles and wires, which have been the main drivers of increased electricity prices.

    But the flat-earthers in the government and News Ltd refuse to face the facts. They have run one dishonest campaign after another on the carbon tax, then pink batts and then the education revolution. We are paying an extraordinarily heavy price for the abuse of power by the Murdoch media in the dishonest and partisan campaigns they run. Are they all as ignorant as Rupert Murdoch’s favourite editor Rebekah Brooks who told a London court this week that she didn’t know that phone tapping was illegal!

    Just recall the extremist and exaggerated language of Tony Abbott in association with News Ltd on the carbon tax.

    • Whyalla will be wiped off the map.
    • Julia Gillard is trying to close down Gladstone.
    • The carbon tax is socialism masquerading as environmentalism.
    • It is a ‘great new tax on everything’.
    • The impact of the tax will be ‘almost unimaginable’

    It says something about the corruption of public debate that Tony Abbott’s campaign with News Ltd’s backing was successful. It was based on fiction and not fact.

    In October last year, one year after the introduction of the carbon tax, the impact on the CPI was almost undetectable. Treasury had estimated that a $23 per tonne emission tax would result in an increase of $9.90 in the cost of living for an average household. It turned out that the impact was even less than the Treasury has forecast.

    Earlier this week Michael West in the SMH on February 24 drew attention to the work of the Energy, Economics and Management Group at the University of Qld. These researchers found that network costs and retail costs which included the profit margin of energy retailers made up 62% of NSW residential electricity prices in 2013. The carbon tax made up only 10% of prices.

    In comparing increases in electricity prices in NSW and Qld between 2007 and 2013, the University of Qld Group found that price increases per kWh were due to the following.

    • Network costs – +7c
    • Retail costs, including profit margin – +2/3c
    • Green schemes, including carbon tax and renewable energy target, – less than 3C

    Generating costs were relatively stable over the period.

    The main increase in prices has been due to the ‘gold plating’ of the networks and the price-gouging by retailers along with large executive bonuses. Green schemes including the carbon tax have a much smaller impact – about 25% of the total increase in prices.

    Michael West put it this way. ‘Tony Abbott [must recognise] that it is not the carbon tax and renewable energy costs that are primarily responsible for energy hikes. The culprit is network costs and state governments that are making a killing’.

    Last week in Sydney the IMF chief, Christine Lagard, said that ‘environmental degradation’ [carbon pollution] was an external cost to the economy that had to be priced. She said that these ‘externalities’ must have a price. Almost every economist will tell us that a tax on ‘externalities’ like a carbon tax is much preferred to Direct Action that the Abbott Government is adopting.

    Tony Abbott has done enormous damage to good policy making to curb carbon pollution and global warming. The flat-earthers have so far won the day in Australia. But surely it cannot last. Is the Australian public so gullible to put up with these scare campaigns on the carbon tax? The flat-earthers in the coalition and News Ltd have done a great disservice to Australia.

    On top of this Tony Abbott is now hemming himself in with people who reject the overwhelming scientific evidence. The head of Tony Abbott’s business advisory group Maurice Newman and Dick Warburton the head of the review of the Renewable Energy Target both think that climate science is “group think”. Newman goes even further and describes climate science as a “scientific delusion”

    When will all this nonsense stop?

    For the sake of our children and grandchildren the flat-earthers must be strongly opposed

     

  • Paul Barratt. Goodwill between countries matters.

    In his Australia Day post Abbott’s relations with China Australia’s first Ambassador to the People’s Republic, Stephen Fitzgerald, begins

    ‘Can you believe the Abbott government has any idea where it’s headed on relations with China? Whatever you think of China’s politics, you can’t just take sides against China or meddle in the tense and volatile issue of China-Japan relations without there being some consequence for our bilateral relations. But the government doesn’t seem to care. From what you can divine from the little it says publicly, it thinks the Chinese will back down under Australia’s glare, and “get over it”. Like the Indonesians will get over it. But the Indonesians, whose thinking we know more clearly, aren’t going to get over it. Abbott and Morrison are so untutored in foreign relations and diplomacy, or so deaf or both, that they don’t understand something has snapped in Jakarta. It’s not about our policies it’s about the language the Abbott government uses and the lecturing, patronising and racist attitudes they convey. A strong, independent, democratic and regionally influential Indonesia is not going to put up with that any longer and relations are never going back to the way they were before.’

    Other academic and journalistic commentators have observed that the Government seems to believe either that relations with Jakarta will return to an even keel within an acceptable period, or that it doesn’t really matter very much. The latter attitude would be of a piece with the Prime Minister’s comment that China trades with us because it is in her interests to do so.

    It seems timely in the light of this very public conversation to relate a couple of anecdotes that indicate the role that the presence or absence of goodwill between states can play as they go about their day to day business, some of which can be of towering importance.

    In 1989 I accompanied then Prime Minister Bob Hawke on an official visit to Korea, Pakistan, India and Thailand, starting in Seoul.  This was the trip on which Hawke successfully proposed, in Seoul, the establishment of a forum for Asia Pacific Economic Cooperation (APEC).  I was in Europe immediately prior to the trip and I timed my arrival in Seoul to enable me to meet the Prime Minister and party on their arrival at Kimpo International Airport.

    Unfortunately, someone in Canberra had neglected to put in to the Taiwan administration in good time a request for diplomatic clearance for the Prime Minister’s RAAF B-707 to transit Taiwanese airspace. Military aircraft are no more permitted to enter another country’s airspace without permission than naval vessels are permitted to enter their territorial waters.

    Urgent clearance was requested, but the Taiwanese did not feel motivated to waive the normal timelines for our convenience, so the Prime Minister’s aircraft had to fly around Taiwanese airspace, and was several hours late into Kimpo. The fact that I was waiting at the airport for the duration is a matter of no consequence; the fact that the Korean Prime Minister was also inconvenienced in this way was embarrassing and of course required us to make explanation.

    In 1998, while I was Secretary to the Department of Defence, the anti-Chinese riots in Jakarta reached a level of seriousness at which we felt obliged to make preparations for a Services Assisted Evacuation of Australian nationals. At the time there were about 20,000 Australians resident in Indonesia, of whom about 10,000 were in the greater Jakarta area, and the rest were scattered throughout the archipelago in numbers ranging from substantial communities in commercial centres like Surabaya to tiny numbers working in remote locations on aid projects, as teachers, or for service-oriented NGOs.

    As soon as we started we quickly received requests for assistance from friendly countries like the United States, New Zealand, Spain and others who had smaller expatriate populations in country and for whom it made little sense to plan a separate uplift.

    Planning an evacuation on this scale across the whole of the Indonesian Archipelago is no trivial matter. It involves identifying the most appropriate airfields to use as pick-up points, the types of aircraft that can be landed there and the gross weight that will be able to take off again. For contingencies such as these it also involves figuring out from where these aircraft can fly in and fly out again without having to refuel.

    Before implementation, it also requires the home government to give permission for all of these aircraft to land – and agree to appropriate exit formalities for all of the people they are planning to pick up.

    Very early in the process the planners began to worry about the vulnerability of the road from downtown Jakarta to the airport. What if we gather together hundreds of people in central Jakarta and can’t get them to the airport because there are disturbances en route or the road is blocked?

    Chief of Navy Vice-Admiral Don Chalmers had a ready alternative up his sleeve. At the time an RAN frigate was exercising with friendly navies to the north of Indonesia, in the South China Sea, and the exercise was drawing to a close. VADM Chalmers suggested that the frigate be directed to remain on station in that approximate location, so that it could proceed promptly to Jakarta if required. He also undertook to ring his Indonesian counterpart, with whom he maintained very good working relations, and tell him what was going on, so that the Indonesians wouldn’t be wondering why an Australian warship was hanging around just outside their territorial waters.

    The Indonesian response? Words to the effect, “We quite understand and we would like to assist you with the planning” – a response of immeasurable value.

    What these anecdotes indicate is that, on occasions when we need from another country assistance or permission it does not have to give, a lack of goodwill can lead to inconvenience or worse, whereas a positive relationship can lead to more being offered than we have requested.

    There will be a price to be paid for our Government insouciantly ignoring the clear messages from Indonesia that it is infuriated by the measures we are taking in pursuit of our “stop the boats at all costs” policy. We had better be very confident that we will not in the foreseeable future need any important favours from Jakarta.

    Paul Barratt was Secretary of the Department of Defence, Secretary of the Department of Primary Industries and Energy, and Deputy Secretary of the Department of Trade.

  • Daniel Brammall. Financial advisers and the conflict of interest.

    In December last year the new government announced how it was going to ‘make financial advice more affordable’ by amending the previous government’s ‘Future of Financial Advice’ (FOFA) proposals (1).

    Recall that the FOFA legislation was introduced in response to hundreds of millions of dollars of Australians’ savings  being lost in the corporate collapses of investments like Opes Prime and Westpoint, as well as financial planners like Storm Financial. These spectacular corporate implosions and the actions of incentivised planners largely took place between 2005 and 2007 — in what we now remember as the good times, before the GFC. Of the nearly $400m invested in the Westpoint group of companies, nearly half was recommended by financial planners (2).

    Given that financial planners propose to advise us on the $1.5 trillion we have in superannuation (4), what do we do about the Financial Services industry’s pink elephant: is this a sales or advice industry?

    In 2009 this prompted an investigation into the Financial Services industry by the Parliamentary Joint Committee on Corporations and Financial Services (3) which asked the question “what is the role of financial advisers in this country?”.

    The answer was unambiguous: “On the one hand, clients seek out financial advisers to obtain professional guidance on the investment decisions that will serve their interest, particularly with a view to maximising retirement income. On the other hand, financial advisers act as a critical distribution channel for financial product manufacturers, often through vertically integrated business models or the payment of commissions and other remuneration-based incentives” (3). The ASIC, as Financial Services watchdog, was more strident: “Remuneration structures used in the financial advice industry create real and potential conflicts of interest that can distort the quality of advice (5).” The ASIC says that not only are conflicts of interest inconsistent with providing quality advice but they are often not evident to consumers. It believes the most effective way to deal with this is to remove the remuneration structures that give rise to these conflicts.

    What could that look like? Simple: to hold yourself out to be a financial adviser, you must be impartial. This means no links to product manufacturers, no commissions and no ‘asset fees’ (commissions by another name). This doesn’t necessarily mean that no one can work for a bank or insurer anymore. It just means that you can’t hold yourself out to be giving impartial advice.

    However on the whole the Financial Services industry is not set up that way. Of the 18,000 financial planners in this country, four out of five are owned by a bank or insurance company. Of the remainder, virtually all of them receive commissions or charge fees calculated on the size of your wallet. In fact, fewer than 30 advisers Australia-wide appear to meet these criteria (8). A small band of independents is gathering under the brand of the Independent Financial Advisers Association of Australia (IFAAA) which last year trademarked a ‘Gold Standard of Independence’, specifically forbidding these three conflicts.

    The big end of town, though, has influenced the new government to the extent that the issue of conflicts has been quietly brushed under the carpet. Last week the Assistant Treasurer said: “The current ban on conflicted remuneration captures a far wider range of circumstances than was originally intended and has resulted in significant compliance costs for industry” (7).

    Here’s the point …

    Many thousands of Australians collectively lost hundreds of millions of dollars – some of them their life savings – in collapses like Westpoint. Conflicts of interest was primarily behind it and the intention of FOFA was to avoid this ever happening again. However the new government is dismantling the reforms because industry has convinced them it costs too much. In doing so industry has successfully transferred the cost to the consumer because without reforms that squarely address conflicts of interest, Westpoint will most certainly happen again.

    — Daniel Brammall, Brocktons Independent Advisory

    References:

    (1)   http://axs.ministers.treasury.gov.au/media-release/011-2013/

    (2)   https://westpoint.asic.gov.au/wstpoint/wstpoint.nsf/byheadline/Actions+against+financial+planners?opendocument

    (3)   http://www.aph.gov.au/binaries/senate/committee/corporations_ctte/fps/report/report.pdf

    (4)   http://www.superannuation.asn.au/resources/superannuation-statistics/

    (5)   http://www.apesb.org.au/uploads/attachment-4-c-asic-submission-to-pjc-inquiry.pdf

    (6)   http://www.smh.com.au/business/profit-above-all-else-how-cba-lost-savings-and-hid-its-tracks-20130531-2nhde.html

    (7)   “Retreat on planners to hit investors”, AFR 8 February 2014.

    (8)   http://www.superguide.com.au/how-super-works/truly-independent-financial-advisers-in-australia

     

  • John Menadue. Patriots and scoundrels.

    Samuel Johnson in 1775 said that ‘patriotism is the last refuge of the scoundrel’. That brings to mind the “patriotic” politics that both PM Abbott and the PM of Japan, Shinzo Abe, are playing. In this Tony Abbott will find more confirmation that “Japan is Australia’s best friend in Asia”, a term that irritates the Chinese.

    I am sure that Samuel Johnson was referring to false patriotism, but that is just what Tony Abbott and Shinzo Abe are appealing to in trying to reshape education and public broadcasting in both countries.

    Teaching children patriotism

    In October last year, Shinzo Abe’s education minister ordered the school board in Taketomi in Okinawa to use a text book that the school board has previously rejected. The school board refused because it included a nationalistic view of WWII history, particularly denial of the Nanjing massacre and comfort women. This order by the Abe Government was the first such order by a national government. It was not surprising that it was rejected in Okinawa which suffered enormously in WWII and continues to hold strong anti-war sentiments.

    Then in December last year, a carefully and politically appointed government committee suggested a change to more ‘patriotic teaching’ in Japan by putting local mayors in charge of their local school districts. Many people believe that this would increase political interference in text books and teaching.

    Shinzo Abe has long attempted to force Japan’s education system to be more patriotic. The word that he and his colleagues use is ‘balance’.

    The view of the Japanese people is clearly against giving more authority to local boards of education and to local Mayors. According to an Asahi poll published on February 18 this year, 59% of Japanese preferred a ‘system that is not dictated’ by local political leaders”. The Japanese people are clearly wary about ‘patriotic education’. Despite the clear view of the Japanese people, Shinzo Abe is continuing his cultural war.

    In Australia, Tony Abbott’s education minister, Christopher Pyne, is on the same track as the Japanese Government in promoting patriotic education. Christopher Pyne has appointed a politically biased curriculum review committee which is clearly designed to shape Australian education in ways that the Coalition Government wishes. Christopher Pyne says

    • Our schools curriculum should have ‘a greater focus on the benefits of Western civilisation’.
    • He wants the curriculum to ‘celebrate Australia’.
    • He would like to see ‘more of a focus on Anzac Day (he would presumably like us to ignore the frontier wars in which  30,000 indigenous  Australians were killed and the fact that Australians and New Zealanders did not first fight at Gallipoli, but in the Maori Wars in New Zealand in the 1850s and 1860s).

    In the name of ‘balance’ Tony Abbott and Christopher Pyne are waging their cultural war in education in favour of a false patriotism in the same way that Shinzo Abe is doing in Japan.

    Public Broadcasting

    Tony Abbott is also following in the footsteps of Shinzo Abe in his attacks on our own public broadcaster, the ABC.

    In my blog of February 12 this year, I pointed out how Shinzo Abe has stacked the board of NHK, Japan’s esteemed public broadcaster. PM Abe has just appointed five new members out of twelve to the NHK board. The new managing director of NHK, Katsuto Momii, and another board member, Naoki Hyakuta, have spelled out the way that NHK should pursue a more patriotic agenda. They have separately

    • Endorsed Shinzo Abe’s visit to Yasukuni Shrine.
    • Described the Tokyo War Crimes Trials as designed to fool the Japanese people.
    • The recruitment of comfort women was not peculiar to Japan.
    • The Nanjing massacre was a fiction.

    Not content with the drooling support of the entire Murdoch media, Tony Abbott complains about our public broadcaster, the ABC. He has said the ABC.

    •  Was ‘unpatriotic’ in the news coverage of the Snowden leaks.
    •  ‘Lacks affection’ for the home team.
    • ‘Instinctively, it takes everyone’s side but not Australia’s’.

    Tony Abbott has not yet had a chance to stack the ABC board but it is only a matter of time. Shinzo Abe has shown him how to do it.

    The public broadcasters in Japan and Australia are greatly admired for their professionalism and independence. The latest Nielsen Poll (17 February 2014) reveals that 59% of Australians do not believe that the ABC is biased. 67% felt that the ABC provided more balanced news and current affairs than commercial TV. Only 15% trusted commercial TV ahead of the ABC. Murdoch’s Daily Telegraph is the least trusted metropolitan newspaper in the country.

    The cultural warriors Shinzo Abe and Tony Abbott are on a unity ticket to try and force more patriotism from our education systems and public broadcasting.

    Neither PM is showing a sense of realism or integrity. They tell those close to them that they are right and much better than the rest of us. They are suggesting that they are patriotic and their opponents are not. They hold to a false and dangerous view of what it is to be a patriot.

    I have one qualification to the above.  I am less concerned about the swing to the right in Australia with its false patriotism baggage than I am about what I see stirring in Japan. In earlier decades the nationalist right was a silly and really harmless fringe parading around Japanese cities in grey vans with loud speakers. The patriotic and nationalist right is now occupying the centre of Japanese political life. The mood is changing after almost two decades of economic stagnation and frustration and now the rise of China. Shinzo Abe is facilitating this upsurge of patriotism and ultra-nationalism. There is a history he is drawing on, a history that brought tragedy to so many, including the Japanese people.

  • John Menadue. Manus and Nauru and Australia’s responsibility in regional processing.

    An asylum seeker who comes to our shores must be protected. We cannot offload that responsibility onto another country. We continue to carry a responsibility for that asylum seeker whatever happens in Manus, Nauru or even Malaysia.

    I have not always held the view that those who come to Australia could be transferred and processed in another country. I changed my mind on that partly because of the rapid increase in boat arrivals after the Agreement with Malaysia fell over in2011. The large number of boat arrivals was reducing public support for a generous and humane refugee program. I came to the view that what was important is that asylum seekers are treated with humanity and that the process is fair and just. The issue of where that processing occurred was a secondary issue.

    I also supported the proposed Malaysian Agreement for two other reasons. I saw it as part of an important building block in regional cooperation. Secondly, the UNHCR was actively supporting the proposed arrangement with Malaysia. The UNHCR does not support the transfers to Manus (PNG) and Nauru and the processing in those countries.

    Unfortunately the agreement with Malaysia was made impossible by the combined support of the Greens and the Coalition in the Senate to block amendments to the Migration Act. The action of the Coalition in the Senate was supported by refugee advocates across Australia. It was quite extraordinary to hear Tony Abbott and Scott Morrison along with refugee advocates criticising human rights abuses in Malaysia. No country is perfect, including Australia in mandatory detention, but the position of asylum seekers in Malaysia would have been a long way ahead of what is now unfolding in Manus and Nauru.

    The collapse of the Malaysian arrangement was the turning point. We have been on a slippery slide ever since. Boat arrivals quadrupled as a result of the High Court decision and the collapse of the Malaysian arrangement. Policies by the Labor Government and the Coalition since then have been punitive and cruel. The result has been Manus and Nauru.

    In my blog of January 14, I pointed out that the UNHCR has a long history of support for the transfer of asylum seekers in appropriate circumstances. Late last year the UNHCR issued a ‘Guidance Note on Bilateral and Multilateral Transfer Arrangements of Asylum Seekers’. It set out clear conditions, including important issues of non-refoulment and protection of the rights and the safety of asylum seekers in the country to which they were to be transferred.

    In the Melbourne Age on 13 December last year, Arja Keski-Nummi and I outlined a system of ‘effective protection’ that should govern any transfers of asylum seekers in our region. We set down several important criteria.

    • All countries should commit to the principle of non-refoulment.
    • Provide asylum seekers with a legal status and access to work and education.
    • Work to help not only displaced people but also host communities.
    • Increase our refugee intake from our region.
    • Work with partners in the region in association with UNHCR to create an atmosphere of safety and trust.
    • Amend the Migration Act to assert the principle of ‘effective protection’ and bind governments to that principle in any transfers of asylum seekers.

    Clearly few of the conditions have been met in the arrangements with PNG and Nauru. Importantly, the UNHCR does not support our arrangements with either country.

    Just as importantly, the Australian Government is failing to accept its responsibilities to asylum seekers that we have transferred to PNG and Nauru. We cannot offshore our responsibilities for ensuring effective protection and safety for asylum seekers. After demonizing asylum seekers for so long I don’t think the Coalition Government cares about the human rights of asylum seekers. Their rights, even their lives are just unfortunate and embarrassing collateral damage

    The horror on Manus is only one part of the havoc that Tony Abbott and Scott Morrison have wrought. They have badly damaged our relations with Indonesia. Their actions have resulted in the collapse of the rule of law in Nauru. And they are responsible for the release of details of 10,000 asylum seekers that will now be eagerly accessed by security agencies in Afghanistan, Iraq, Iran, Pakistan and Sri Lanka. What an opportunity it will be for those security agencies to now hunt down the families of asylum seekers who have fled to Australia from oppressive regimes in those countries.

    How ironic it now is that China is rebuking us for our abuse of the human rights of asylum seekers.

    One thing the ALP in Parliament should do immediately  is move to incorporate the principle of “effective protection ” in the Migration Act. It would clearly express the responsibility we have for persons transferred to another jurisdiction. We could then not shirk our responsibility by  passing the buck to others.

  • John Menadue. Cutting waste and costs in health.

    Last night on lateline, the Minister for Health Peter Dutton called for a public debate on health reform. I therefore have taken the liberty of reposting a blog of February 3 on ‘Cutting waste and costs in health’.

    The Minister for Health, Peter Dutton, has said that we must reduce waste and reduce costs in health. I agree. In 2011/12 total health expenditure in Australia was $140b up from $83b in 2001/2. Costs are rising rapidly, partly due to population increase.

    In a paper in July 2007 I estimated that there was at least $10 billion in possible savings and productivity improvements in health. That represented about 10% of our total health costs in that year. I have spoken and written extensively on the matter. See my web site.

    It is important however that as we work to reduce waste and costs we do it in a way that is fair to all and does not prejudice quality care.

    But to reduce waste and costs requires political will to stare down the powerful interests and rent seekers that are determined to protect their territory and their high costs –e.g.  the AMA, the Private Health Insurance firms, the Pharmacy Guild of Australia and Medicines Australia. In the past no governments has been game to tackle these vested interests.

    The lack of accountability in health

    Despite the rapid increases in costs and escalating demand in the healthcare industry, there is no accountability in any meaningful way for what the health industry produces. Doctors are accountable for malpractice but not for their overall performance particularly in general practise. This is despite the fact that taxpayers pay 80% of doctors’ incomes. Taxpayers have a legitimate reason to ask – ‘Are we getting value for money?’  In a survey a couple of years ago by the Health Council of Canada, 97% of over 1,800 senior respondents said that healthcare providers should be required by law to reach certain service benchmarks in such areas as patient outcomes , the use of preventive strategies like screening and waiting times.

    The Council also asked the group ‘Do you believe healthcare in Canada will improve if the government spends more money on healthcare?’  58% said ‘no’. There is the same lack of accountability in Australia.

    Managing the demand for health services

    The demand for health services is increasing rapidly across all age groups and not just among the old. We are over-diagnosed and over-treated. In 1984-85, medical services per head were 7.1 per annum. In 2007-08 they were 13.1 per annum – about double. The trend continues. We need to address this over servicing particularly by GPs and specialists such as pathologists and radiologists.

    • We must accept that we cannot have all that we want in health and that governments, in consultation with the community, have to set priorities. Can we afford continuing existing levels of funding for IVF and end-of-life treatments at the expense of funding for mental health and indigenous health?
    • We need to rationalise our co-payments to make them efficient and equitable. We all should take more responsibility for the way we use health services, particularly as we are now much wealthier than we were 30 years ago when Medicare was introduced. A universal health scheme does not have to be free. But it must be fair and efficient. But co-payments are a dog’s breakfast! We pay about 18% of health costs out of our own pockets, but there is very little rhyme or reason in how this is done. The $6 GP levy would make the confused situation worse.
    • We need to change the perverse incentives, such as fee-for-service, which is associated with bulk-billing. Clinicians are rewarded by the number of transactions rather than health outcomes. FFS is particularly inappropriate for chronic care like mental health and services with high fixed costs and low variable costs, such as imaging. The government should move away from fee for service and set budgets for general practitioners when they prescribe drugs, order pathology tests or imaging services. We need more doctors on salaries and capitation payments for caring for patients-not on a service by service basis.
    • We need to tackle the wide variations in the incidence of clinical practice across the country, e.g. caesarean sections and cataracts. Medicare should be much more proactive in exposing and limiting very expensive and inexplicable variations in clinical practice.

    Getting costs down

    •  The government should abolish the subsidy for private health insurance which costs all up about $6-7 billion p.a. This subsidy favours the wealthy, is inefficient, has underwritten rising specialist fees through gap insurance, has not taken the pressure off public hospitals and has weakened Medicare’s ability to control costs. The immediate abolition of this subsidy would do more to improve our health system than almost anything else. This is corporate welfare big time-more even the welfare to the motor industry.
    • We need a more productive workforce. Health is the largest and fastest growing sector in the Australian economy. Despite all the talk of improving productivity in Australia no-one has been game to take on the entrenched privileges in the health workforce.Where is the honesty and consistency here? The blue collar workforce is fair game but not doctors and lawyers. We need expanded roles across the board particularly for nurses, pharmacists, allied health workers and ambulance officers. The Productivity Commission in its February 2007 report estimated that a 5% improvement in the productivity of health services would deliver savings of about $3 billion p.a. This is a very conservative estimate. The health sector in Australia is rife with demarcations and restrictive work practices. eg 5 % of normal births in Australia are delivered by mid wives. In the Netherlands it is 70%, in the UK 50% and in NZ 95%. We have a few hundred nurse practitioners when there should be thousands. The work practices at Holden, Toyota and Ardmona are light years ahead of the work practices in the health sector.
    • We could save about $2 billion p.a. in drug costs if we paid drug suppliers the same prices that are paid in NZ. See my blog of January 17.We also pay a high price for the protection of  pharmacists through the 5000 limit on the number of community pharmacies and the restrictions on where new pharmacies can be located. Pharmacies cannot be established in supermarkets.
    • We need to raise productivity in our hospitals. The Productivity Commission suggests that the productivity gap from best practice in public hospitals ranges from 3% to 89%. In private hospitals the range is 22% to 37%.  There is major governance problems in many hospitals with a dis- connect between management and clinical functions. Running hospitals is very difficult with clinicians coming and going from private practise like the cottage industries of old.
    • The Commonwealth/State fragmentation in healthcare results in blame-shifting, the evasion of responsibility and higher costs. If for example the Commonwealth Government or a joint Commonwealth/State body had responsibility for all health care in a state, there would be a clear incentive for focus on treatment in the community and in homes to ensure that the high cost hospitals are really a last resort. They are now often a first resort.
    • The real elephant in the room in health care cost reduction is avoidable mistakes, including deaths. They are euphemistically called “adverse events”. But Ministers, clinicians and managers do their best to avoid the issue. Based on earlier surveys in NSW and SA I estimated, very conservatively the cost of avoidable mistakes in our health sector at $5b pa (see my blog of June14, 2013). Despite a great deal of money and effort there is no sign of improvement. Insiders won’t solve the problem Good people are caught in a bad system

    We need to address waste and cost-cutting in a measured way. We should not panic, but we should get it done.  Australian healthcare costs are 9-10% of GDP. This is not high by world standards. It is below the OECD average. A major reason why we have been able to do better than others is that we have Medicare as a public insurer. One lesson is clear all around the world. The countries that have high levels of private health insurance, like the US, have high costs.

     

  • John Menadue. Opinion and fact on climate change.

    Tony Abbott keeps telling us that climate change is not a factor in the current drought in eastern Australia. Last October he ruled out climate change as a factor in October’s early season bushfires in the Blue Mountains.

    He keeps giving us opinions when the facts, supported by overwhelming scientific research, tell us that Australia is already experiencing more frequent and more intensive heatwaves, and that we can expect the number of hot days to continue to increase. He said that the climate change will not be a factor in the drought aid package he will announce soon. That aid package should take into account climate change and the necessity for marginal farmers on marginal land to find other occupations.

    Tony Abbott’s confusion of opinion and fact reminds me of the comment made by the late Senator Daniel Moynihan that ‘Everyone is entitled to their own opinion, but no-one is entitled to their own facts’.

    Reputable people and reliable organisations are all pointing to the challenge that climate change presents to Australian agriculture.

    CSIRO says ‘forecasts show Australia will have to cope with less rainfall, longer dry periods and struggling crops’. (ABC News 15 January 2013). Mark Howden from CSIRO’s Climate Adaption Flagship Program tells us that ‘Increases in temperature … and decreases in rainfall will increase drought periods and increase dry spells’. (ABC News 3 February 2013). Steve Crimp, a Senior Research Scientist at CSIRO says that southern Australia faces ‘warmer and dryer conditions’. (ABC 3 February 2013).

    The Garnaut Climate Change Review said ‘Climate change is likely to affect agricultural production through changes in water availability, water quality and temperatures. Crop production is likely to be affected directly by changes in average rainfall and temperatures, in distribution of rainfall during the year and in rainfall variability. The productivity of livestock industries will be influenced by the changes in the quantity and quality of available pasture, as well as by the effects of temperature increases on livestock. … A range of studies indicate that grain protein contents are likely to fall in response to combined climate and carbon dioxide changes. There could be substantial protein losses … which would lower prices.’(p129)

    The Department of Environment of the Australian Government reported last year on “Climate Change Impacts in Australia” which included the impact on agriculture.

    • For NSW it said that ‘potential changes in climate may reduce productivity and output in agricultural industries in the medium to long term through higher temperatures, reduced rainfall and extreme weather events.’ It predicts possible falls in agricultural production in NSW by 2030 of 8.4% for wheat, 8.1% for sheep meat and 5.5% for dairy.(p35)
    • In respect of Queensland this report says ‘Future productivity growth in agriculture may be affected by climate change in the medium to long term…’ It mentions that ABARE estimates possible production declines by 2030 of 19% for beef and 12% for sugar (p45).
    • The report says in respect of WA, ‘By 2070 south-west WA is likely to experience yield reductions in wheat. Cropping may become non-viable at the dry margins with strong warming and significant reductions in rainfall.’ The report highlights that wheat production could decline by 9% by 2030 with similar declines for sheep meat.(p34)
    • For SA the report says ‘Since 1997 SA’s agricultural regions have experienced a marked decline in growing season rainfall. This decline is mostly due to a drying trend in autumn and to a lesser extent in winter. … Overall the trend in annual rainfall since 1950 shows a decline across the agricultural region. … Rising temperatures are likely to have a major influence on wine grapes bringing the harvest forward by a month and yielding lower quality grapes. … ‘(p35)

    In 2011 CSIRO published a report by Chris Stokes and Mark Howden on “Adapting agriculture to climate change” They say ‘The Australian climate is already changing and these changes have a measurable impact on primary production as the drying of the Murray Darling basin and the wheat belt bear witness” (p85) They add “ areas of farming that are economically marginal today are among the most vulnerable to climate change; here impacts are most likely to exceed the regions adaptive capacity, stressing their communities, farming systems and natural resources. Such areas include outer wheat belt zones subject to drying, warmer dairying or fruit growing areas, or irrigation communities whose water resources are in decline-all areas where quite small changes in climate can have quite large economic and social consequences”

    Tony Abbott refuses to face these facts.

    At the same time US Secretary of State John Kerry calls climate change “a weapon of mass destruction” and the IMF calls on Australia as the Chair of the G20 to show leadership on the issue

    What is just as remarkable is that the National Party which claims to represent farmers and country people is as quiet as mice in the haystack on climate change. The National Party relies on people like Gina Reinhart for financial support. It ignores the long-term interests of its own farming constituency by following the climate sceptics in the Liberal Party.

    No group in Australia is as vulnerable to climate change as Australian farmers. Historically they have shown themselves very good at adapting to change but they are not helped by the lack of leadership by the National Party.

  • Michael Kelly SJ. Australians as the ‘white trash of Asia’ reaches new depth.

    It is now over thirty years since the then Prime Minister of Singapore, Lee Kuan Yew described Australians as the “white trash of Asia”. The barb stung and is still recalled with shame and hurt by Australian politicians as then Prime Minister Julia Gillard did in 2012.

    But the term has reached a new level of accuracy with the current Australian Government led by Tony Abbott who has degraded Australia’s relations with China, Indonesia and Timor Leste close to their lowest points in decades with one piece of diplomatic ineptitude and insensitivity after another.

    White trash is a derogatory American English term referring to poor white people, especially in the rural South of the US, suggesting lower social class and degraded standards. The term suggests outcasts from respectable society living on the fringes of the social order who are seen as dangerous because they may be criminal, unpredictable, and without respect for authority whether it be political, legal, or moral

    While the deafening “stop the boats” mantra of the Abbott Government, with muscle supplied by the defence forces in Operation Sovereign Nation, gains all the media attention in Australia and throughout the Asian region, a policy shift introduced by the Government on refugees and asylum seekers has gone almost unnoticed.

    By accident this week, and despite the Government policy of “no speaks”, I discovered something new – to me anyway. Almost since the day they arrived on the Treasury benches, the Abbott Government has found a new way of persecuting victims.

    In Immigration Minister Scott Morrison’s armory now is a rule that anyone who arrived by boat in Australia is unable to sponsor any other refugee or asylum seeker.

    Thanks to information provided to me this week in Bangkok by the Jesuit Refugee Service (JRS), I discovered that a Sri Lankan family that has been waiting for resettlement for THIRTEEN YEARS and finally got accepted by Australia, had their visas revoked because relatives who reached Australia by sea were sponsoring them.

    I was speaking with one of the legal team at JRS, Kathryn Smyth, because of some Pakistanis I am helping with their application for refugee status. In response to a request from a Jesuit friend in Pakistan, I am effectively “in loco parentis” for five (soon to be six with a birth expected in April) refugees whose only crime in Pakistan is that they are Catholics.

    They were forced to flee following events where they were beaten up, shot at and given the popularly administered death sentence that comes with accusations of blasphemy.

    With Kathryn, I was checking some of the documents I’ve prepared for these people and she told me again in graphic detail something I know too well: that even if they got the first of three interviews with the UNHCR today, they would most likely not get the second interview till January 2016.

    And then there’s a further year of waiting for the UNHCR’s adjudication followed by an unknown wait till a country accepts them for resettlement.

    I said “Yes, yes, I and they know about it” only to be told of the casual vindictiveness of the Abbott Government in its merciless treatment of people adjudged by the UN to have “a well founded fear for their lives on the basis of race, ethnicity or religion”.

    There are literally thousands of refugees and asylum seekers in Thailand. The UNHCR can’t cope with the scale of demand that the troubles in Pakistan and Afghanistan are presenting them with. When a refugee lands in Bangkok, they register with the UN for consideration of their case.

    Many of the refugees and asylum seekers in Bangkok are like my friends – Christians fleeing the terror of the blasphemy laws introduce President Zia Ul Haq who was assassinated in 1988. Those laws allowed Muslims to allege that anyone had been blasphemous by insulting the Prophet Muhammad.  Summary execution of the accused is then allowed with no action taken by police or Courts to bring the murderers to justice.

    For refugees arriving in Bangkok, it takes between three and six months to get to first base – and initial consideration that allows the applicant to be scheduled for an interview about their case that takes at least two years to happen.

    And in the Thai capital, there are currently 3,100 in that category of applicants trying to get to first base. There are many thousands more in the line waiting for the interview two years hence. They live on a pittance, patiently doing all they can do – wait!

    For the Sri Lankan family I mentioned earlier, where do they go after 13 years waiting, finally getting acceptance only to have the prize ripped from your grasp? Perhaps the Australian Government has done them a favor. Who’d want to live in a place that treats human beings this way?

    White trash, as mentioned, live beyond the common standards of decency and respect for human dignity, and through their assessments and actions degrade the common humanity we share.

    As an Australian, I regret to say the country’s performance in Asia deserves the description that Prime Minister lee gave us long ago.

     

  • John Menadue. The squandered mining boom.

    We are now paying a heavy price for our failure to manage the mining boom. The consequences are all too clear, particularly in the manufacturing sector. The mining boom drove up our exchange rate and wage costs. A Sovereign Wealth Fund (SWF) and the Resource Super Profits Tax (RSPT) would have minimised the problems. However, few seriously proposed a SWF. The Coalition and the powerful mining companies did everything possible to destroy the RSPT.

    The squandering of the benefits and opportunities of the mining boom is causing major disruption across the economy. What have we really got to show for the national treasure that we have squandered?

    We can take some late remedial action by cutting back on business and middle class welfare which I have written about. We should also increase our very low levels of taxation, particularly to fund our long term infrastructure needs, both physical and human.

    The Norwegians point the way for us in their establishment of a SWF in 1990. It was called the Government Pension Fund Global.

    • Last month each Norwegian became a theoretical millionaire through ownership in the Fund, but they would not have been able to spend the money. It was saved and invested for future generations.
    • The fund was set up to avoid the temptation by governments and the public to splurge the windfall returns following the discovery of oil and gas in the North Sea in 1969.
    • The funds the government receives in oil and gas revenue are invested almost exclusively abroad, rather than in Norway.
    • Exchange rate remained relatively stable and cost rises were checked. Unemployment has been kept low.
    • The Norwegian Finance Minister in January this year said “Many countries have found that temporary large revenues from natural resource exploitation produce relatively short-lived booms that are followed by difficult adjustments”.

    This is not to say that Norway doesn’t have problems but the fund has helped iron out big swings in oil and gas prices, stabilised the economy and allowed Norwegians to invest for the future rather than squandering money in the boom times

    We should have done the same. But at least we can be ready for the next mining boom which will inevitably come. Will it be in gas?

    Our Futures Fund just does not cut it alongside the successful funds established in Norway and elsewhere. Large SWFs operate in Saudi Arabia, UAE, China, Kuwait, Hong Kong, Singapore and many other countries.

    Instead of a SWF, we could have run much larger budget surpluses from 2003 onwards when the China boom kicked in. But there was always a political temptation of the Howard Government followed by the Rudd and Gillard Governments to win political popularity by spending the revenue from the mining boom. An SWF would have made it much easier to persuade Australians that we needed to save for the future and invest in key infrastructure. We showed that in our political support for the Disability Scheme. We were willing to pay the tax levy for the scheme because we agreed with the objectives of the scheme.

    The mining boom produced enormous profits for the mining industry. The industry squandered a great deal of it in foolish investments and wage increases that flowed through to other parts of the economy. The miners acted as if they were playing with monopoly money. Rio Tinto alone had to write off $35 billion in failed investments. Its business management in China was a debacle. With so much money flowing through its hands it lost any sense of rigor and discipline. Just imagine what the Institute of Public Affairs and its bulletin board the Australian Financial Review would say if any government in Australia lost money on such a grand scale.

    In addition to their foolish investments, they paid extremely high wage rates to attract skilled staff to the mining areas. In the five years to June 2013 hourly rates of pay in the mining sector increased by 24%, excluding bonuses. These pace-setting wages dragged up wages in other sectors – manufacturing up 17%, construction up 20% and retail trade up 16%.

    With so much income flushing through the mining companies a Resources Super Profits Tax (RSPT) would have helped average out mining company profits with high taxes in boom times and lower taxes during periods of lower prices. Paul Keating would have called it an automatic stabiliser. It was just what we needed in terms of equity in sharing the benefits of the mining boom, but it was also desirable for good economic management to slow down the boom and force companies to be more realistic about spending “monopoly” money. The RSPT would have better secured our future, bringing the budget into surplus much earlier.  We also know that taxing profits is a better means of raising revenue than through royalties based on production.

    We also know that the Rudd/Gillard Governments made a political mess of the RSPT.And in taking advantage of this mess the Coalition sided with the powerful mining lobby which was very good at engineering and protection of its narrow interests but not very good in prudent investments for the future.

    There is a painful adjustment ahead. We should make sure we learn from the failures of our last squandered mining boom.

     

  • John Menadue. Pink batts and the Royal Commission – a bridge too far.

    There are good grounds for Kevin Rudd and Julia Gillard to refuse to provide documents to the Royal Commission on Pink Batts. The Royal Commission is a very vindictive act by the Abbott Government. And the government looks like continuing to use other Royal Commissions for political purposes!

    In separate blogs by Michael Keating on January 8, 2014 and by me on July 11, 2013, we have pointed out the following.

    • 1.1 million installations were completed under the Home Insulation Scheme (HIS) – a considerable achievement.
    • The rate of fires during this scheme was three times less than prior to the HIS.
    • The regulation of programs such as this, including safety, is clearly in the hands of state governments, not the Commonwealth.
    • Only 7% of installations had to be rectified – a quite low figure.
    • One fatality was caused by a pre-existing fault; another was caused when an electrical installer was employed by another electrician, and a third death occurred when a contractor elected to work in oppressive heat.

    But beyond these issues which the media and The Australian in particular, ignored, there is an important issue of whether the Royal Commission should have access to Cabinet documents. Media reports suggest that Kevin Rudd and Julia Gillard may refuse to provide Cabinet documents.

    There is an important principle in the Westminster parliamentary tradition that new governments do not rifle through the documents of a previous government. This is set out very clearly in the Cabinet Handbook issued by the Department of Prime Minister and Cabinet in the name of the Australian Government. (7th edition, 2012). Paragraphs 17 to 19 say the following:

    • Cabinet records (files) are held on behalf of a government in the care and control of the Secretary of the Department of the Prime Minister and Cabinet (PM & C) and are issued to ministers and departments on a need-to-know basis. Once a minister or department no longer has any immediate need of them, and, in any event, when the minister vacates office or a change of government occurs, any copies of Cabinet documents must be returned to the Cabinet Secretariat or destroyed.
    • The convention is that Cabinet documents are confidential to the government that created them and not the property of the sponsoring minister or department. Access to them by succeeding governments is not granted without the approval of the current parliamentary leader of the appropriate political party.
    • Cabinet records and cabinet notebooks are accessible to the public through the National Archives of Australia after the expiration of the statutory closed period. The closed period, which for Cabinet documents currently varies between 20 to 30 years, seeks to provide the best balance between the competing priorities of, on the one hand, the need to safeguard privacy, security and confidentiality of the Cabinet, and to use available resources to best effect, on the other hand, maximising public access to records.

    I would expect that the Secretary of PM & C would now be advising the Abbott Government that the Cabinet documents relating to the Home Insulation Scheme (pink batts) should not be released.

    When Malcolm Fraser became Prime Minister at the end of 1975 he was being urged by party colleagues to release documents of the Whitlam Government relating to the ‘loans affair’ – a matter of far greater moment than pink batts. Some members or supporters of the Liberal Party had commenced legal action in the court in Queanbeyan against the former PM and and former senior ministers. Despite the opportunity to make more political mischief, Malcolm Fraser refused to have the documents released.  In my autobiography ‘Things you learn along the way’, page 173, I wrote ‘[Malcolm Fraser] was … persuaded that it was unwise for one government to be raking through the documents of another government and that if the matter came to court the Commonwealth Government should refuse to release them’. I was Secretary of PM & C at the time.

    It is one thing for parties to make political mischief in Opposition. In Government, they need to act more responsibly and with due regard to the established government and parliamentary conventions that have stood the test of time.

    Where there was a good case for a Royal Commission would have been for the Rudd and Gillard Governments to initiate a Royal Commission into how Australia became involved in the disastrous Iraq and Afghanistan wars. Fortunately, neither Kevin Rudd nor Julia Gillard chose a Royal Commission to settle a political score.

     

     

  • John Menadue. Cutting back government spending – does it include middle-class and corporate welfare?

    Tony Abbott told his listeners recently at Davos that small government was the best form of government.

    The Minister for Health, Peter Dutton, has said that waste must be reduced in our health sector.

    The Minister for Social Services, Kevin Andrews, has told us that our welfare system is unsustainable and has appointed Patrick McClure to review welfare in Australia.

    And the Treasurer, Joe Hockey, has established a Commission of Audit to look at ways to reduce ‘big government’ with priority to reducing government outlays. He said that the age of entitlement had to end. But for whom! He said ‘it is .. essential that the Commonwealth government lives within its means and begins to pay down its debt’. We know of course that by any international measure we do not have a debt problem but let us pass on that for the moment.

    Before we look at fair and efficient ways to improve our public finances, there are a few broad issues to be considered.

    First, we do have a long term ‘structural deficit’ of about $60 billion p.a. The IMF has told us that the most recent culprits were the Howard/Costello governments that reduced tax rates year after year when we were flush with revenue from the mining boom. The Gillard and Rudd governments did face the GFC and sensibly increased government spending. They made some attempt to reduce middle class welfare, but they failed to grasp the major recommendations of the Henry Review to reform our tax system.

    Second, Australia does not have a growing public sector. As Ian McAuley, Jennifer Doggett and I have set out in our submission to the Senate Select Committee on the Commission of Audit, there is no evidence of any sustained increase in government spending (see my website by clicking on at top left of this blog). In fact, outlays have been trending downwards since the mid-1980s. Andrew Podger, who is Professor of Public Policy at the ANU and former Secretary of the Department of Health and Ageing, said on January 22 in the AFR, ‘The claim that Australia’s welfare system is unsustainable would surprise observers in most other OECD nations which spend a much higher percentage of their GDP on social security payments. Our emphasis on flat rate, means-tested payments rather than earnings-related social insurance has limited the burden on Australian taxpayers.”

    Third, our tax as a percentage of GDP has fallen steadily since 2002 from 30% to 28%, well below the OECD average of 34%.

    Fourth, our health expenditure runs at about 9% to 10% of GDP which is much the same as the OECD average, mainly because of the efficiency of our public insurer, Medicare. We could save substantial amounts in the health sector however if the government would confront the vested interests in health that force up government spending – the AMA, the Private Health Insurance firms, Medicines Australia and the Pharmacy Guild of Australia.

    The issue that stands out is that we need to improve our revenue base. This is where middle class and business welfare is a major problem – the tax-deductions or ‘tax expenditures’ that reduce the effective level of tax and provides disproportionate benefits to the well-off in the community. FlagPost, published by the Australian Parliamentary Library noted on January 29 2014 that Australia has the highest level of tax deductions in the OECD

    • Treasury estimate that the concessions for super contributions and tax-free payments of superannuation to persons over 60 years of age, like me, costs about $32 billion p.a. A phase-in of a 15% tax on superannuation draw-downs would quickly raise $5 billion p.a.
    • The Grattan Institute estimates that property investors get a benefit of about $7 billion p.a. through negative gearing and the capital gains tax discount. These concessions help inflate property prices and push home ownership out of the reach of young people.
    • The Grattan Institute also estimate that the government provides about $36 billion p.a. in benefits to home owners through exempting the principal house of residence from capital gains tax and aged pension entitlements. The aged pension is asset-tested, but that test excludes the principal residence. The Minister for Social Services is not prepared to address this issue. The aged pension is excluded from his review. Yet the aged pension costs $36 billion p.a. and accounts for roughly half of the welfare budget. If the government was serious about winding back welfare it would not exclude the aged pension from any review.
    • The government has also excluded from the McClure Review Tony Abbott’s $5.5 billion pa parental leave scheme in which the baby’s primary carer would receive six months leave on full pay up to a maximum of $75,000 p.a. This is middle class welfare in neon lights.

    There are also large hand-outs to the corporate sector, particularly the finance sector

    • There is a subsidy of $6 billion to $7 billion p.a to the high cost Private Health Insurance companies who keep pushing up their premiums which are really private taxes.
    • If we had blinked just before Christmas, we would have missed the largesse that Assistant Treasurer Sinodinos handed out to the financial services industry. The previous government took action to stop superannuation advisers automatically collecting commissions year after year – trailing commissions. It was estimated by the Industry Super Network that this reform by the previous government in stopping these commissions would add $144 billion to private savings by 2027. But Arthur Sinodinos has announced that the Abbott Government will roll back this reform and give financial advisers a chance to plunder our superannuation savings again. The government has given the all clear to the financial advising industry to re impose a private tax on superannuation contributors. There is also no sign that the government is acting to stop the super funds owned by the big banks funnelling their cash exclusively into their parent banks for relatively low returns. It is a private tax on super contributors. That is surely abuse of power or worse but neither ACCC nor APRA seems concerned!
    • The Abbott Government has announced that it will retain the fringe benefits salary packaging for expensive, mainly foreign cars at a cost of almost $2 over four years.
    • The government shows no interest in saving $2 billion pa in drug costs by being as rigorous as New Zealand in negotiating drug prices with suppliers in Australia.
    • Large polluters will be subsidised by removing the market discipline of a price on the carbon that they emit.

    There are also other ways that the Commonwealth Government could address the structural deficit. It should expand the GST to include food, education, health and financial products. Most countries do not have the exclusions that we have. The extension of the GST would raise about $16 billion this year and $70 billion by 2016-17.

    In short, we need to lift taxation. Taxes in Australia are too low. It is the truth we refuse to name.

    In global terms we don’t have a government expenditure problem, although a great deal of middle class and business welfare should be rolled back.

    We also need to look urgently at areas of real need, particularly the disabled, those in need of special help in social housing, those who receive meagre benefits in Newstart (the dole) and refugees.

    We should all share the pain in getting our budget into shape, even though the problem is nowhere as severe as we were told in the election. My concern is that so-called “dole-bludgers “of talk back fame will be the target and the wealthy and politically powerful will be largely exempt. The government has already cut aid to the poor in developing countries.

    I live in hope but I am not expecting an end to the age of entitlement for the rich and powerful. Just think executive salaries, transfer pricing and tax havens! But maybe Joe Hockey has something up his sleeve!.

    Given the present weakness in the Australian economy it is also  important that the reduction in our structural budget deficit is done carefully and not in the drastic way that brought so many problems in Europe.

  • Jennifer Doggett. Cutting waste and costs in health.

    ​Cut expensive and low-value services: Health funding is not allocated to areas which deliver maximum output. We spend too much on expensive low-value services and not enough on preventive, high –value care.  Recent research shows that a number of routine tests performed in the Australian health system do not improve clinical outcomes. These include x-rays for lower back pain, liver function tests for people on statin therapy and routine glucose tolerance tests for pregnant women.

    Structural reform: There is significant duplication of functions, gaps and poor coordination across areas of Commonwealth and State/Territory responsibility.  There needs to be a single funder and/or single point of accountability for all health care (as recommended by the NHHRC)

    Reform the funding system:  Funding arrangements for health services often do not reflect their value. We need a funding system which ties subsidies to value and which steers consumers towards the more cost-effective treatment option. For example, where physiotherapy is a more efficient treatment for a soft tissue sporting injury than conventional medical treatment it should be subsidised at a higher rate.

    Remove interest groups: Powerful vested industry groups, such as the pharmaceutical industry and the medical profession, influence policy and funding decisions resulting in anti-competitive and rent seeking practices that disadvantage consumers.

    Move away from fee-for-service: A (largely) fee-for-service payment system does not support doctors to provide comprehensive, preventive and multi-disciplinary care for people with complex and chronic health problems.  At least for these people we should investigate alternative payment systems, such as a capitation model.

    Workforce reform: Doctors in Australia undertake many tasks which in other countries are safely and efficiently done by nurses.  Breaking down professional barriers should allow for the lowest cost person to provide the care, where they can do so safely and effectively.

     

  • Ian Webster. Cutting waste and costs in health

    Waste in health care conjures up several pictures.

    One picture is of community nurses, psychologists and Aboriginal health workers in the community centre I visit anchored to their computer screens, endlessly it seems, trying to fulfil the demands of data entry. They are obviously frustrated by the lack of relevance this has for solving the problems of their patients. It takes time away and it is disempowering. About one third of each day is lost in this way.

    While not so apparent, there is a certain cynicism amongst the local hospital’s specialists about ‘gaming’ to preserve the local hospital’s funding and the administrative demands made on their time. The Garling Special Commission of Inquiry into Acute Care Services in NSW Public Hospitals in 2008 highlighted how non-clinical workload takes time away from clinicians who should be able to dedicate this time to clinical tasks. And the Greater Metropolitan Clinical Taskforce in 2004 reported on the conflicts between the information needed for clinical decisions and the data used by the administrators and funders. John Menadue, in his speeches on health care reform, has described the mismatch between vertical bureaucratic accountability and reporting and the horizontal and shared communication and working relationships of health professionals.

    There is much disillusionment in the current health care system where there should be enthusiasm and pride. Not only is time wasted in an atmosphere of excessive checking, rechecking and codification – to protect the Minister and the system – but good people and good-will are being wasted. Despite the demands and impediments on their time and commitment there are still front-line heroes who “go well beyond the call of duty” to pick up the pieces left undone by others. These people are the pivots around which the services revolve and they should be celebrated and encouraged.

    To prevent waste, data collection and information technology must be ‘practice-worthy’; they must help solve clinical problems and assess the progress of patients if they are to contribute to effective and efficient patient care.

    The second picture is of the waste of misdirected efforts.

    In the National Report Card on Mental Health and Suicide Prevention of 2012 the National Mental Health Commission, on behalf of the mental health community, expressed disquiet about the Activity Based Funding (ABF) being developed for the National Hospital Pricing Authority. The Commission said, “The new ABF system should be designed to meet the needs of people with mental health difficulties regardless of whether services are provided in hospitals, in the community or elsewhere. Alternatives to hospitals must be a priority.” The fear is that ABF will inevitably suck funding for mental health back to hospital activities rather than support and care in the community. If any part of ‘health’ demands a community-based approach, mental health does.

    The Commission’s view is that people should be supported to have contributing lives where they live and work and not be dependent on hospital-based services, necessary as this may be at critical times. Exactly the same can be said in the prevention and management of physical health generally – especially in the management of chronic disease and the intractable complexities of the increasingly prevalent multiple conditions. For people with these conditions hospital admissions are but punctuated interludes along pathways lived out in the community.

    Waste will mount inexorably so long as we neglect to invest in primary health care and community health.

    Professor Ian Webster is Emeritus Professor of Community Health at the University of New South Wales.

     

  • John Dwyer. Cutting waste and costs in health.

    ​

    Tactics and strategies for a six year journey to sustainable, equitable excellence

    (1) Move to a single funder for our national health scheme (The Commonwealth). The funder would contract with States and other potential providers to deliver integrated patient focused care. The health bureaucracy would be reduced by 80% with greater efficiency, better outcomes and less duplication saving at least $ 4 billion per year.
    (2) Remove Tax-payer support for Private Health insurance. Health Insurers are making large profits. Australians will retain their PHI as other sticks make that a certainty. The introduction of the subsidy saw PHI increase by only 2%.
    (3) Introduce peer and craft approved critical pathways to see more evidence based decision making re tests and procedures . Savings $20 billion per year.
    (4) Focus on reducing avoidable expensive hospital admissions ( more than 600,000 per year) through cheaper and better timely community interventions. Requires the introduction of Integrated Primary Care teams. Will need to broaden Medicare funding to cover health professionals other than doctors but net savings anticipated at least $7 billon per year.(5) Introduce slowly but steadily capitated funding for the management of”chronic and complex”diseases with mandatory reporting of health outcomes.

    Professor John Dwyer is Emeritus Professor of Medicine at the University of New South Wales.

  • Ian McAuley. Cutting waste and costs in health.

    There are three areas of saving to be made in health care – real savings rather than movement of costs from public budgets to consumers.

    There can be savings in technical efficiency — savings any engineer or cost-conscious manager seeks in a workplace. A strong example is making better use of information technology.

    There can be savings in purchasing.  Australia used to negotiate some of the world’s lowest pharmaceutical prices.  We now pay high prices.

    My concern is the third area – improvements in allocative efficiency.  That is, ensuring scarce resources are allocated where they will result in greatest benefit.

    The priority should be to remove private health insurance as a source of funding.  Administratively, it does at high cost what the Australian Tax Office and Medicare do much better.

    Its big costs are in terms of allocative inefficiency, for it simply re-shuffles queues, allocating resources to those with subsidized insurance, pushing others to the back of the line.

    Getting rid of private health insurance would save around $1.5 billion a year in administrative costs alone. The Grattan Institute estimates net savings of $3.5 billion a year.

    Other savings in allocative efficiency can be found in making better use of nurses, more careful prescribing of pharmaceuticals, and rationalization of co-payments so that people are not directed to “free” services in preference to more effective and lower-cost services involving upfront fees.  And, of course, there are big savings in all-of-government initiatives to encourage good health.

    Ian McAuley is a teacher and researcher in the fields of  public sector management and public policy.

  • Chris Geraghty. The ABC and Scott Morrison

    The ABC has been much criticised, by our Prime Minister no less, and by the silly bullies on some commercial radio stations, for not being patriotic enough, for not barracking for the home team. Disloyal journalists published a story that some wounded, unwelcome refugees who had been intercepted on the high seas by our navy boys and girls were alleging that they had been tortured by them, forced to grasp and hold onto hot engine pipes and burnt. These dishonourable journalists broadcasted pictures of several dark-skinned men presenting their severely burnt hands to camera and complaining about the brave troops defending our borders.

    I don’t know whether the allegations are true or false. I wasn’t there at the time to witness what was happening. Some people were there if such an incident or anything like it occurred. Presumably the refugees themselves were there, but even that I do not know from my own knowledge, so I must suspend my judgment pending further information. However, they have said that they were there and that they were tortured, or at least treated in such a way as to sustain serious injuries.

    The Minister for Immigration, Scott Morrison, would have us believe that the incident never happened, that the allegations are unsubstantiated, and therefore false. He might be right. I don’t know. And neither does he. He wasn’t there either. So he is clearly relying on what he’s been told, though we don’t know what he was told, or by whom. We don’t know whether the person he spoke to (if he in fact spoken to anyone) was present at the time or where he got his information from. As far as the Minister’s denial of the truth of the allegations is concerned, we are still all in the dark.

    Now, as to the allegations themselves, Scott Morrison invited us to accept that they are false, for two reasons.

    Firstly, this alleged incident was not something our brave, professional, respected, trustworthy navy men and women would ever be part of. It’s offensive to contemplate the possibility.

    Secondly, there is no evidence to substantiate these serious allegations.

    As to the first basis offered for rejecting the allegations, like all other patriotic Australians, I’d like to think it is true that our service personnel would not engage in such cruel and criminal treatment of vulnerable human beings. But this was the very same reason offered for years by naive Catholics to refute the vile allegations that members of the clergy were sexually abusing children. Professional people don’t always act professionally. Sometimes, some professional people, even Australian professional people, commit crimes. It’s hard to believe, but unfortunately it’s true. American troops in Vietnam engaged in the mass slaughter of civilians, and participated in horrible torture of the enemy in Iraq. We even saw pictures on television of unprofessional, criminal behavior of service men and women. It’s not new, and it’s not confined to the enemy. And closer to home, we have had to accept that unwanted sexual activity, criminal sexual behavior has been engaged in on naval vessels by our brave, professional service-men. I wish it wasn’t true, but we have to accept that sometimes good men can do terrible things, especially to people they have learnt to classify as “illegals”, as “invaders”. If these allegations eventually prove to be true, the shock jocks and our Prime Minister will have a lot to answer for.

    As to the second reason proffered by the minister, it might surprise him to know that there is evidence to substantiate the allegations, and no admissible evidence to undermine them – only the merest hearsay of the minister. The evidence might be thin. We might wish to have more evidence – evidence of an independent witness, for example. There might be grounds for some suspicion. As the evidence stands, it only amounts to a prima facie case, but in the absence of any admissible evidence to the contrary, it substantiates and establishes the allegations.

    What is the evidence? It consists of three important items. Firstly, several people, more than one, make a similar allegation. Secondly, each alleges that he was tortured or treated harshly by members of the Australian navy, and suffered injuries to their hands. And thirdly, there are pictures (presumably genuine pictures) of the burns sustained to the palm area of their hands.

    Now, that’s the evidence. It’s easy to say that it’s a slur, that it’s false and that the ABC should not have given succor to the enemy, but neither the navy nor the Government has taken any steps to demonstrate in any way that the allegations are groundless. And they claim to have the proof. It’s just that no one else is allowed to see or hear it. We have to trust the word of the minister. He assures us that the claims are scurrilous and groundless.

    Let’s hear from someone who was there, other than the refugees. Someone from the poop-deck or the engine-room. The captain or one of the petty officers. The person recording the events on video as they were unfolding. Let’s see the film. We didn’t see the poor mother throwing her baby overboard. Maybe we won’t see sailors mistreating refugees on the high seas.

    It’s not the traitorous behaviour of the ABC journalists that worries me. It’s the fact that smug, secretive ministers and their shock jocks treat the public like drongos.

     

     

     

  • John Menadue. Sharks and asylum seekers

    Over the weekend we have seen thousands of people crowding onto our beaches on both sides of the country to protest against the culling of sharks in Western Australia.  I happen to think that the protesters are right, that people who swim in dangerous seas know the risks but are prepared to take them. Compared with the carnage on our roads, the number who die from shark attacks is quite minor.

    But the protests made me ask why we do not see the same protests supporting asylum seekers, fellow human beings fleeing terror of a different sort.

    Why are we so exhausted in defending the rights of asylum seekers? Maybe it is because the problem is so large, it’s long-term and seems to be intractable. What can we do to make a difference?

    I think our willingness to “pass by on the other side” is because for over a long period deliberate and successful attempts have been made to anaesthatise our consciences to the plight of asylum seekers and refugees. We have become numb to the tragedy that we have allowed to happen in our name.

    I suggest that there are a string of events and actions that have made us less sensitive.

    • John Howard was the first Prime Minister in Australia since the war to show us the great political benefit in appealing to our fear and our worst instincts. Tony Abbott has followed in the same path.
    • We were told at the time of the ‘children overboard’ event that asylum seekers were so inhuman and degraded that they would even throw their children overboard.
    • Tony Abbott continues to call boat people ‘illegals’, akin to criminals, when they are not. As a colleague of Tony Abbott’s at a Jesuit college put it ‘They are not illegals, they are our brothers and sisters’.
    • Scott Morrison told the Coalition Caucus that most people believe that asylum seekers are Muslims and that that should be exploited.
    • He later told us that asylum seekers bring disease and wads of money.
    • The new Member for Lindsay at the last election told us that asylum seekers are blocking the M4 in Sydney.
    • Eric Abetz in Opposition told us that asylum seekers in the community who offended, even in a trivial way, should be treated like paedophiles.

    The demonization of asylum seekers and refugees continues almost daily. The media is largely silent. Its major interest is the politics of boat arrivals, not the plight of the persecuted. The leadership of our churches, synagogues and mosques is scarcely heard. The Vietnamese community that was given a haven in Australia more than 30 years ago is silent. The Labor Party is largely silent as are many members of the Coalition who I know are privately very concerned about what is happening.

    What is it that sharks have that seems to make their plight more important than that of asylum seekers and refugees? Our consciences have become numb. The demonization of asylum seekers is proving to be a political winner.

    It seems to be worth making the effort to save sharks but not human beings also fleeing terror.

     

  • Walter Hamilton. The ABC and its Japanese Cousin.

    If the board and management of the ABC need to firm up their ideas about the proper relationship between a public broadcaster and the government of the day they might consider what is happening in Japan.

    NHK, that nation’s public broadcaster, is a $7bn enterprise largely funded from television licence fees, with a board of governors appointed by the prime minister. It exerts enormous influence through its highly rating news and information programs, but the situation in which it now finds itself––criticised for being a mouthpiece for the conservative national government––is in sharp contrast to the ABC’s predicament. In thinking about how to respond to the attacks of Tony Abbott and others, managing director Mark Scott and chairman Jim Spigelman might reflect on their Japanese cousin.

    There are direct parallels. The ABC has an international service that must report on controversial issues such as the Navy’s involvement in forcing back boats of asylum seekers from Indonesia. NHK has an international service that must report on issues just as touchy, including the territorial disputes Japan has with China and South Korea.

    On 25 January, at his first news conference after being appointed NHK president, Katsuto Momii (a former business executive with no background in broadcasting) was asked how the organisation should approach the subject of the Senkaku (Diaoyu) islands. He replied: ‘International broadcasting will be different from domestic programs. Regarding the territorial issue, it will only be natural to clearly present Japan’s position. It would not do for us to say “left” when the government is saying “right”’. In responses to other questions, he effectively endorsed the Abe government’s position on visits to the Yasukuni Shrine, the use of ‘comfort women’ during the war and the necessity of a new state secrets law.

    Though clearly embarrassed by this kowtowing performance, the government’s chief spokesman later excused Momii’s remarks on the basis that he was expressing his ‘personal views’––as if that made them irrelevant. (Former ABC chairman, Donald McDonald, while still in that position, continued his fund-raising activities for the Liberal Party according to the same logic, so there is an Australian precedent.) On Friday, summoned before a parliamentary committee, a nervous Momii heard an opposition member express the concern of some that NHK was becoming ‘the public relations department of the government’. Also last week, an economics professor quit an NHK radio program, on which he’d been a commentator for 20 years, after being told to refrain from criticising the nuclear power industry during the current Tokyo gubernatorial election. Keeping silent on the election issue, he was advised, was NHK’s way of maintaining balance.

    By some accounts, the man that Momii replaced at the top of NHK, Masayuki Matsumoto, decided not to seek a second term because of complaints from within Shinzo Abe’s Liberal Democratic Party that NHK gave too much prominence to critics of nuclear power and the American military bases in Japan. It must be said, however, Matsumoto’s presidency was marked by other scandals and for most of his three years the now-opposition DPJ (Democratic Party of Japan) was in office.

    Nevertheless, for someone who watches NHK daily (via satellite) a change in tone and content of its news and current affairs programs has become more apparent since the Abe government returned to power. Conspicuous has been the switch from prominent coverage of anti-bases activities in Okinawa to muted and irregular coverage of this issue. For such a thing to be apparent is significant because, for as long as I can remember, NHK’s news product has been predictably middle-of-the-road. Never flamboyant or opinionated, its programs could be boring through avoidance of controversy, and thus culturally conservative, but rarely did they carry political bias on their sleeve. Now, according to Momii, the policy is: what’s right for the LDP government is right for NHK.

    How this will play out with the Japanese public remains to be seen. Already one in four television owners is refusing to pay the NHK licence fee, for whatever reason. In this respect, NHK is more exposed to the public mood than the ABC, which is funded directly by parliament. It is easier for the Abbott government to punish the ABC by, for instance, taking away the Australia Network (which is funded separately through the Department of Foreign Affairs and Trade).

    There are some within the ABC who would welcome this step. They have always felt the international service sapped resources from the corporation’s primary, domestic functions and would rather have the battle-lines with the Coalition drawn along the issue of how the ABC serves its Australian audience.

    But this would be risky and shortsighted. Australia Network, if it is to project the nation’s values to the world, must be able to report without fear or favour, a core value in a society that embraces free speech. Here and now is the place to stand up and be heard. Secondly, the ABC’s critics obviously believe it is easier to make the case that the corporation has grown ‘too big’ than it is to win the ‘bias’ argument. (Donald McDonald himself took this line during a recent appearance on the ABC, though when asked for examples to prove the ABC was overstretched only mentioned seeing errors in Supers, the text that appears on screen identifying people during news items.) Chopping off the Australia Network, if achieved without great political cost, could embolden more and deeper cuts aimed at specific domestic services.

    In making a defence for the role of a vigorous public broadcaster the ABC’s bosses might look down the path NHK is sliding and take heart from the alarm being raised in Japan. The ABC’s journalists and other program-makers, meanwhile, though understandably eager to rush to the barricades to counter the apparent threat from the conservative side of politics should think again. It would be much better for them and for their organisation not to treat this as a partisan cause (Labor, when in power, also wants a co-operative ABC) and avoid openly siding with critics on the left (including on Facebook). The principles of free speech and openness that form part of the fabric of our democracy are, and must remain, above party politics. If the ABC, in upholding the highest standards of professional journalism, must sometimes say ‘right’ when the government says ‘left’, then the Australian public can be relied upon to know and respect the difference.

    Walter Hamilton, a former Tokyo correspondent, worked at the ABC for 33 years.

     

  • Insults in our region continue

    Sometime late last year, the Australian government made the seemingly innocuous decision to revert, after 18 months, to calling the Southeast Asian nation of Myanmar by its British name Burma. One of Tony Abbott’s growing list of regional insults.

    (more…)

  • Walter Hamilton. A Strategy Less Than Grand: Where the ‘New Japan’ Goes Wrong.

    In a commentary published by the Lowy Institute entitled “Japan is Back: Unbundling Abe’s Grand Strategy*, Dr. Michael Green (Japan Chair at the Center for Strategic International Studies in Washington, DC) analyses the political and economic policies of Japan’s conservative government under Prime Minister Shinzo Abe and concludes that “the overall strategy could be quite effective” in enhancing Japan’s prestige and forcing the cooperation of China.

    The article is detailed, wide-ranging and informed by high-level contacts within Japan. The credentials of the author and the forum in which his views were aired suggest they are likely to be consonant with advice that Prime Minister Tony Abbott is receiving from his foreign affairs advisers. The article deserves a close reading because Green’s attempt to give Abe’s policies the status of a “grand strategy” unintentionally exposes their underlying contradictions.

    The author begins by arguing that Abe’s strategy does not represent a break with the past: “[His] national security agenda is not, in fact, a departure from the general trajectory established by his predecessors in the post-Cold War era.” Elsewhere, he asserts, “While scholars have emphasised the debate among different strategic schools in Japan, the real debates now are mostly about the timing and scope of change – not its direction.” Green wants to counter any suggestion that Abe is an extremist or maverick politician acting out of step with popular opinion. Later in the article, however, he states: “The policy and legal obstacles that Abe is now busy removing as part of his internal balancing strategy were erected by previous Japanese governments eager to build a buffer against involvement in US military plans in the Pacific.” There is an obvious contradiction. Is Abe building on existing policy frameworks or dismantling them?

    Green’s case that Abe’s policies are continuous with the past, on closer examination, is based mainly on the claim that “[his immediate predecessor, Prime Minister] Yoshihiko Noda…began the push for most of the key elements of Abe’s security agenda.” In other words, by “predecessors” he means principally Noda. While it is true the Noda government sought to shore up Japan’s alliance with the United States, this represented a swing of the pendulum back from the failed attempt of a former leader of his ruling Democratic Party of Japan, Yukio Hatoyama, to put a distance between Tokyo and Washington. Noda gave expression to one side of the historical “bi-polar” complex that has characterised Japan’s postwar relationship with the US. Furthermore, the Noda government––deeply unpopular because of its perceived incompetence––took strategic decisions (notably the purchase of the three Senkaku/Diaoyu islands that so enraged China) reactively, under duress and without a clearly articulated policy agenda. To posit a continuum between Abe and the panicked previous administration is curious, to say the least.

    Green refers to a former “left-leaning” Prime Minister Takeo Miki’s opposition to arms exports, without identifying him as a leader of the same Liberal Democratic Party Abe now heads. The LDP, like the DJP, has always contained competing views on whether rearmament or disarmament best serves Japan’s national interest, whether a look-to Beijing or a look-to-Washington posture is preferable. The current ascendency of the pro-Washington hawks within the LDP is just that: a phase in a cyclical power play. To suggest, as Green does, that a single continuity of views has existed within Japan’s leadership since the breakup of the Soviet Union is unsupportable. (The recent about-face by former Prime Minister Junichiro Koizumi, coming out against nuclear power and backing a rival to the LDP’s candidate in Tokyo’s gubernatorial election, is a further example of the volatility of Japan’s conservative mainstream.) While it is true that Abe enjoys a high level of support within the electorate––anything over 50% is extraordinary by recent standards––there is little evidence that the so-called “grand strategy” (which Green invests with a spurious coherence) goes more than slogan-deep in terms of public understanding. Indeed it is incapable of being comprehended, I submit, because of its internal contradictions.

    Another of the contradictions emerges when Green discusses regional responses to Abe’s policies. He states that the Abe Government “is pursuing foreign and security policies that are welcomed…by most governments in the region.” Yet he also says, correctly, that “the most striking thing about his diplomacy is that it has been focused on the near and far abroad rather than the immediate neighbours South Korea and China.” Given that the other key players in Japan’s region are, of course, China and South Korea, how does Green’s first statement stack up? He seems to believe that Australia, the US and other like-minded nations should support Japan in a diplomacy conducted over the heads of its nearest neighbours: “Abe’s preference for diplomacy with the states around China’s periphery also reflects his view that Japan’s natural partners are the democratic maritime states.” For Australia to automatically support Japan against its neighbours, rather than urge Tokyo to seek an accommodation with nations of vital interest to us, would be foolhardy.

    Green identifies within Abe’s diplomacy (correctly, as far as it goes) an attempt to present Japan as a bastion of freedom, rule of law and transparency, and thus a defender of “Western” values, as opposed to the alternative “Pan-Asian” version that defines Japan by cultural and ethnic affinities. Japan, however, has been down a similar path before, in the period 1900-1925, and that, as we know, proved unsustainable. Green concedes that “tensions between Seoul and Tokyo are indirectly hurting broader Japanese influence in Asia and even in Washington” but does not explain how, by facilitating a diplomacy that overlooks South Korea, the US or Australia would benefit. Green treats the disagreements over historical accountability, so damaging to regional relations, as “complications.” This happens to be the prevailing Japanese attitude, based on the calculation that since China and South Korea have not always been as strident about such matters in the past, they can be waited out. The danger of inaction, however, was underlined again recently when the new president of NHK, Japan’s national broadcaster, made light of the “comfort women” issue during a news conference. Every time the Japanese Establishment’s complacency and recalcitrance are exposed, the gulf widens. If Abe wishes to lead a credible world power he must embrace a credible and candid accounting for the nation’s past. More than a complication, right now it is the spanner in the works.

    In his discussion of Japan’s defence needs, Greens starts from the proposition that “China’s coercive pressure in the East China Sea…is most likely to spark a larger confrontation.” No evidence is offered for this one-sided view. He considers an increased Japanese military capability, including counterstrike deterrence, the sine qua non of a strategy to prevent Chinese coercion. Green’s account of why the country has lived for so long with a limited military capability is pure revisionism: “Japan’s deterrent capabilities are significantly less efficient and credible because of the numerous legal and bureaucratic constraints that have accumulated in the post-war period.” The language suggests that red tape, rather than a popular aversion to military adventures, has been the main constraint on Japan since 1945. The opposite is true. Japan’s war-renouncing constitution has been the central pillar of the nation’s postwar prosperity, and to dismiss it as a “bureaucratic” encumbrance is quite perverse. Certainly, various governments over the years have reinterpreted the basic law to enable Japan to maintain a modern military establishment but each step on that journey has kept intact a credible commitment to the principle of non-belligerence (though critics of Japan’s support for American military engagements in Asia and elsewhere would, of course, disagree). This is a whole-of-state issue, not a matter for backroom tinkering.

    Green reports a “growing interest in Tokyo in the concept that Japan might use the development of counterstrike capability as a source of leverage vis-à-vis the United States.” He argues that as a result of Japan embracing a broader definition of its right to collective self-defense “the SDF will be seen by allies, partners, and potential adversaries as a more effective fighting force within the confines of Japan’s renunciation of war as a means to settle international disputes.” A more effective fighting force, I suggest, is not necessarily the best advertisement for the renunciation of war. For the two to be possibly compatible would require a style of leadership––inclusive, disposed to listen rather than dictate, and sensitive to the concerns of neighbours––that Abe so far has not displayed.

    Green describes a view taking shape within the LDP that the government need not move immediately to revise Article 9 of the constitution in order to achieve its military-strategic objectives; it can do so through an administrative measure. But a change to Japan’s military posture to include a significant counterstrike capability, without a full airing of the issues that a debate on the constitution would enable, is not a development Australia should welcome. It runs counter to the very democratic values Abe insists link his nation to “natural partners” like Australia. The centralisation of power under Abe that Green identifies (and approves of), including the creation of supra-parliamentary organs, such as the new National Security Council and National Security Bureau, and the enactment of a wide-ranging state secrets law, might, to some, make Japan a “normal” country, but they seem unlikely to cast more light on the murky process of Japanese policy formation––quite the reverse.

    A final contradiction arises in Green’s discussion of the support he says the US, Australia and others should lend Japan in its confrontation with China: “The United States, Australia, and all maritime nations have a stake in Japan not backing down under Chinese military pressure. Ultimately, a modus vivendi might be reached in which Japan finds a way to acknowledge officially that there is a de jure dispute [over the Senkaku/Diaoyu islands].” For Japan to acknowledge that a de jure territorial dispute exists, as Green surely knows, would to Abe and his supporters constitute a back down. Such a concession might be desirable; but to argue against backing down to China and, in the same breath, to advocate it is peculiar. Green gets into this pickle by failing to adequately acknowledge that Japan’s actions have contributed to the impasse with China. Japan’s friends would do better to denounce the hardliners on both sides and propose solutions that get beyond fixed positions implied by the term “back down.” Green’s proposal would lead to an untenable situation in which anything Japan says or does must be approved, or else. He writes: “Resisting Japanese requests for joint contingency planning or pressuring Tokyo to compromise in the face of Chinese coercion would do fundamental damage to the credibility of the [US-Japan] alliance and lead to more pronounced hedging by Japan. The result would be less US control over escalation in a crisis in the East China Sea and weakened dissuasion and deterrence all along the offshore island chain.” You can’t have it both ways. Either Japan is a partner who can be resisted and corrected, as well as supported, or it is a liability. The same goes for China.

    Green performs a valuable service by articulating issues that Australians should be considering as a matter of urgency. Without a doubt, Abe (who has compared current relations between China and Japan to those between Germany and Britain in 1914) is the strongest, most belligerent Japanese leader to emerge for decades. There are, however, flaws in his “grand strategy.” Diplomacy conducted over the heads of China and South Korea to engage supposedly like-minded democratic maritime partners such as Australia should make any modern Bismarck quaver. Resolving the historical grievances between Japan and its former colonial underlings is essential to future regional security. They will not fix themselves. To demonstrate its commitment to democratic values Japan needs a full-blown debate about the role of its defence forces within the constitution rather than increasingly centralised and elitist decision-making. Australia’s interest in a vibrant and peaceful Japan requires our leaders to oppose all measures that heighten regional tensions and undermine longer-term stability.

    * http://www.lowyinstitute.org/publications/japan-back-unbundling-abes-grand-strategy

    Walter Hamilton reported from Japan for the ABC for eleven years. He is the author of “Children of the Occupation: Japan’s Untold Story”.

     

  • John Menadue. Alcohol and violence on the streets — the tip of the iceberg.

    In recent weeks public attention has been focused on alcohol fuelled violence in Sydney streets and the very slow response of the NSW government. But the response when it did come really only addressed the ugly tip of the iceberg. the violence on the streets. The government response was superficial – minimum mandatory sentencing, greater powers for the police, special licence conditions and lockouts and closures.

    Very little attention was given to prevention and remedial action – the widespread social and economic cost of alcohol misuse across Australia as revealed in our workplaces, roads, and criminal justice and health systems.

    We focus on cannabis, but compared with alcohol, it is a much less potent and dangerous drug. Only a week or so ago, President Obama said ‘I don’t think that cannabis is more dangerous than alcohol’. He was right.

    The long-term effects of alcohol are well-known as outlined by the University of NSW Drug and Alcohol Research Centre– cancer of the mouth, brain injury, high blood pressure, weakness and loss of muscle tissue, inflamed stomach lining, increased risk of lung infections, severe swelling of the liver, inflamed pancreas, and other dangerous consequences. Street violence in Kings Cross is really only a small part of a much larger problem.

    The Australian Institute of Criminology, in April 2013, set out the cost of alcohol misuse in 2010.  The costs were estimated at $14.4 billion which is about double the revenue the Commonwealth government receives from alcohol taxes. That estimated $14.4 billion cost four years ago was made up as follows:

    • Criminal justice system- $3 billion, police, courts, prisons, child-protection, etc.
    • Health system – $1.7 billion in hospital, nursing home, ambulance and other areas.
    • Productivity – $6 billion, mainly losses of production through impaired work and imprisonment of large numbers of people.
    • Traffic accidents – $3.7 billion.

    This study commented that its finding of about $14.4 billion of alcohol costs in 2010 was conservative. Furthermore the figure does not include the negative effects of alcohol on others, estimated to be $6.8 billion in 2010.

    There is clearly an enormous problem just below the surface of street violence. We are concentrating our attention on the streets when there are other major problems below the surface.

    The study of the Australian Institute of Criminology points to the need for prevention and diversion strategies. That really means breaking the booze culture.

    I suggest a major diversion strategy should be the review alcohol advertising in association with sport. It is surely an obvious contradiction to be promoting a healthy life style through sport and promoting alcohol at the same time. In my blog of January 4 ‘Cricket – junk food and alcohol’, I drew attention to the saturation advertising of alcohol during the Ashes Tests. It now continues in the One Day Series. It is unremitting. The alcohol advertising is on the scoreboard, the ground, the shirt fronts, the sleeves the caps, boundary fences, stumps and sight-boards. So far the ‘baggy green’ cap does not carry alcohol advertising but surely it won’t be long before it is carrying a beer logo!. With almost all points covered with alcohol advertising how about Carlton Mid tattoos!  The victorious Australian team poured Victorian Bitter all over each other in the dressing room after the series win. The Australian coach and captain, with one arm around each other and holding beers aloft meandered around the Sydney Cricket Ground. It was tacky. It sent a poor message to young people.

    To protect children, the advertising of alcohol on television is banned before 8.30 pm. But because of the power of the alcohol lobby, advertising is on full display almost all day at most of our major sporting events.  To start winding back the enormous cost of alcohol abuse, we should start by prohibiting alcohol advertising on television and radio at all sporting events, just as we did years ago with tobacco advertising. For the sake of young sports fans our major sporting bodies need to break free from the grip of the alcohol lobby.  Our sporting heroes, the role models for the young should also think carefully about filling their pockets with money from the promotion of alcohol. Who will be the first to make a stand? Australian young people would be particularly well served by such leadership.

    Violence in Kings Cross after midnight is just the tip of the iceberg.

  • John Menadue. Our lack of business and political skills in Asia.

    The Business Council of Australia and business executives keep reminding us of the need to increase our productivity by up-skilling and better use of our labour resources. Unfortunately the business sector is spectacularly lagging in equipping itself for opportunities in Asia.

    Last week The Australian Financial Review surveyed the schools and educational backgrounds of the CEOs of our top ASX100 firms. It found that one third of these CEOs went to secondary schools outside Australia. But not one of them had spent their formative schooling years in Asia.

    This confirms the dismal record of Australian business in Asia.

    • I have yet to learn of a single chairperson or CEO of any of our major companies who can fluently speak any of the key Asian languages.
    • A recent survey by the Business Alliance for Asian Literacy, which represents 400,000 businesses in Australia, found that ‘More than half of Australian businesses operating in Asia had little board and senior management experience of Asia and/or Asian skills or languages’.
    • Because of the lack of integration of human resources and business strategy in Australian firms, many executives who are posted to Asia leave within a few years of their return.  They find the culture in the Australian head office quite unsympathetic to Asia and the experience that they have gained.
    • Australian firms do recruit Australian-born citizens of Asian descent, but they are more likely to be recruited for their good grades and work ethic than future leadership potential. It is hard to break into the Anglo clubs that dominate so many of our large companies.

    Equipping ourselves for Asia has been on and off our agenda for many years. In 1989 the Garnaut Report pointed the way that Australia should respond to the North East Asian Ascendancy.  Through the Hawke/Keating Government periods we responded. We opened up our economy. More skilled people began working in the region. The media became more interested in Asia and exchange programs were established.

    And then in the Howard years we went on smoko. We were encouraged to be relaxed and comfortable and not get too excited about equipping ourselves for Asia.

    The Rudd and Gillard Governments slowly tried to get us back on track. Ken Henry reported in 2012 on Australia and the Asian Century, and how we should respond. A few targets were suggested, but little was really done before the September 2013 elections. The Rudd/Gillard Governments were distracted by other issues.

    The Abbott Government shows signs of pushing us off track again with its clumsy handling of our relations with China and Indonesia. Tony Abbott talks about his belief in the “Anglosphere”. It is not clear what he really means but most observers would conclude that it excludes Asia

    Foreign Affairs Minister Julie Bishop is now telling us that ‘our single most important economic partner is in fact the United States’. The blinding and obvious fact is that the two-way trade between Australia and China is $130 billion p.a. compared with $60 billion p.a. between Australia and the US. To bolster her amazing assertion, Julie Bishop adds in US investment in Australia. Where is she getting this US-centric nonsense from?  It is trade flows that traditionally determine economic relationships, not investment. To top it off Julie Bishop then added that the US is our ‘best friend in economic terms’ when clearly it isn’t.  For the second time in three weeks we have gone out of our way to offend China.

    At least the Gillard/Rudd Governments pointed to the direction we had to head – Asia. Now the Abbott Government seems to be suggesting that Asia could be the wrong direction.

    Our business sector seems to be in agreement with the Abbott Government that Asia is not as important to our future as we all thought

  • Stephen FitzGerald. Abbott’s relations with China.

    Can you believe the Abbott government has any idea where it’s headed on relations with China? Whatever you think of China’s politics, you can’t just take sides against China or meddle in the tense and volatile issue of China-Japan relations without there being some consequence for our bilateral relations. But the government doesn’t seem to care. From what you can divine from the little it says publicly, it thinks the Chinese will back down under Australia’s glare, and “get over it”. Like the Indonesians will get over it. But the Indonesians, whose thinking we know more clearly, aren’t going to get over it. Abbott and Morrison are so untutored in foreign relations and diplomacy, or so deaf, or both, that they don’t understand something has snapped in Jakarta. It’s not about our policies it’s about the language the Abbott government uses and the lecturing, patronising and racist attitudes they convey. A strong, independent, democratic and regionally influential Indonesia is not going to put up with that any longer and relations are never going back to the way they were before.

    And the risk is that at the same time relations with China will be pushed back to at least where they were before Julia Gillard secured agreement for a regular high-level strategic dialogue with Beijing in April last year. This is not only harmful to our bilateral relations and restricting in our scope for managing them in our own interests. It will limit Australia’s capacity to be an effective player in regional affairs and a useful voice in the balancing of US China relations.

    The fact is the government doesn’t have a China policy, in any coherent, strategic, long-term sense, and it has laid out no narrative in any speech or document that would give the lie to this assertion. Its handling of the issues with China over the last few months has been in the service more of a neoconservative confrontationist US view of China than an Australian view or Australian interests.

    At the US-Japan-Australia Trilateral Strategic Dialogue in the wings of the APEC ministerial summit in Bali in October 2013, Australia put its signature to a communique which “opposed any coercive or unilateral actions that could change the status quo in the East China Sea”. The problem is, it’s the very status quo itself which is in dispute between Japan and China, and by some interpretations the Chinese case is by no means weaker than Japan’s. Whatever the rights, Australia needlessly and recklessly took sides in a complex dispute in which we have no part, and Beijing of course reacted.

    And there’s a bit more. The final wording agreed in Bali was reportedly different from the draft prepared by DFAT, bearing the stamp particularly of the two drafting officials from Tony Abbott’s Australia and Shinjo Abe’s Japan (Tony Abbott’s ‘best friend’ in Asia). The Australian official was Abbott’s Senior Advisor on National Security, Andrew Shearer, allegedly in Bali to ride herd on the neophyte Foreign Minister Julie Bishop and an advocate of bludgeon diplomacy and hairy-chested confrontation of China.

    In November, China declared an Air Defence Identification Zone, ADIZ, in the East China Sea. This may be a matter of concern to Australia, but it’s not immediately proximate for us, and it’s one for us that demands skilful diplomacy not confrontation. Australia had a range of possible responses, but Julie Bishop went straight for a public slap down, carpeting the Chinese Ambassador to Australia Ma Zhaoxu to denounce Beijing’s move, and rubbing the Chinese nose in it by talking it up in language that suggested ‘Look what I’ve done!’ The concerning thing about this is that it was bound to achieve nothing other than provoke a tougher, uncompromising position from the Chinese, and so it did. “Irresponsible”, said Beijing. But worse for us, it put diplomacy out of play, again to the detriment of our relations and any role in whatever diplomatic potential there might be for amelioration of the tensions surrounding the issue.

    Julie Bishop then made a scheduled visit to Beijing, and we saw on television the famous prelude to her meeting with Chinese Foreign Minister Wang Yi. It’s the first time I’ve seen a senior Chinese, during the photo opportunity that precedes such bilateral meetings, vent a disagreement in this way with any country, even with the Japanese at difficult times in their relations. Wang Yi’s body language alone would have been a fairly blunt signal, but his sharp words in front of the media amounted to an official Chinese declaration that relations with Australia were in bad shape. In the history of our diplomatic relations, apart from the Tiananmen massacre we’ve not had such a stand-off. This, at a time when what we need most is to get closely alongside the Chinese and do whatever we can diplomatically to help defuse regional tensions and work on the development of a new order in the Pacific that peacefully accommodates Chinese as well as US power.

    Yet in December, when Prime Minister Abe visited the Yasukuni Shrine and other countries in the region with an interest in Japan’s wartime record immediately objected and even the US cautioned Japan, Australia said nothing. This is a deeply emotional issue for both China and Korea, who interpret a prime ministerial visit to this shrine as an intentional denial of Japan’s wartime atrocities. And whereas on the two earlier issues the Australian government spoke out when it might to greater effect have chosen a diplomatic response and a public reticence, on this issue it didn’t even refer to it till a month later, and then only en passant in a Bishop interview with the Financial Review, when the incident was well out of the way.

    With China, as with Indonesia, disagreements and policy differences can be managed, but it’s the way we’ve gone about it, and the language, and the idea from colonial times that if you speak English to these people loudly and clearly enough they will understand and do what they’re told. And for Beijing, there’s the unmistakable message that on matters it regards as vitally affecting its sovereignty, we stand with a particular US view that doesn’t want to accommodate Chinese power.

    Beijing has not got over it. But what will it do in response? So long as it sees benefit for China, it’s unlikely to want to disturb economic relations or derail the FTA negotiations. What’s more likely is downgrading the importance it gives to political and strategic dialogue. But political and strategic dialogue is the one element of our relations we can least afford to lose. It took years to persuade an Australian government to understand this, and when finally it was taken up by Julia Gillard it took a huge effort to get the Chinese government to come to the party.

    This is serious. It’s not a case of being pro-China or seeing Asia through a Chinese prism, which is what the proponents of the US policy of denial pretend. To lose that dialogue or have the Chinese not take it seriously would be a major setback for us. And make more difficult the management of our economic relations. And deny us opportunities to resolve through diplomacy and dialogue the many challenging issues we’re going to face directly with China as a Great Power in our external habitat and a force in our domestic politics.

    What will happen, if the Indonesian government turns to China to supply or even directly assist its navy in the protection of Indonesia’s sovereign borders? And China obliges? And they turn to Abbott, Bishop and Morrison and say: “you, of all people, ought to understand”?

    If you meddle in someone else’s issues by taking sides when you’re not a party principal, can you really believe they might not meddle in yours?

     

    Dr.Stephen Fitzgerald was former Australian Ambassador to China

  • Michael Kelly SJ: Chaos reigns in Bangkok

    The fear of many Thais is that the country will end up like the Philippines – so laid back that nothing gets done, so corrupt that everyone stops trying, so mismanaged that there is misery for many just around the corner.

    While things may not have reached the depths of Marcos era chaos, there are worry signs. Why? There seems now no way out of the circumstances the country finds itself in:

    • The protests are led by a former deputy prime minister facing murder charges over his part in 2010 when there was the bloody suppression of just the sort of protest movement he leads;
    • The Government, whose performance has been below par on the economy and whose legitimacy as an elected majority is doubted because of the financial supplements offered to those who voted for them, is paralysed;
    • The King who usually provided the circuit breaker in Thai politics is too ill to take part;
    • The military are shy about participating because of the very negative reaction they got in 2010 for their bloody intervention then;
    • The police are not trusted and are believed by many to be still loyal to Thaksin Shinawatra who was once a leader among them.

    The slide into chaos is gentle and few would venture to suggest what might unfold when leadership is absent and the forces at work are so weak, contradictory and ineffective.

    Take this week: a State of Emergency was declared but absolutely nothing has changed – the demonstrators are still clogging up the city by holding rallies at intersections where it appears the same crowd processes from one point to another to listen to speeches and applaud musical performer. There is hardly a police officer to be seen.

    And now, with the country a week off an election which the Government says it is legally bound to hold within 60 days of the dissolution of Parliament, the country’s Constitutional Court declared there’s nothing to prevent a delay in the holding of the election.

    Something has got to give. But it would be a brave person who could say with confidence what will. After two weeks, it’s hard to see the Bangkok protestors who are fed up with the Shinawatra family, quietly going home. Being fed up, anger is not resolved by meekly agreeing to disband.

    There is a reported 35,000 people who have come from the south (the Opposition’s stronghold) and are financially supported by those managing the protests. Why would they go home if they are in paid employment?

    The Shinawatra supporters will concede that Thaksin and his sister aren’t angels but the alternative is a collapse back into a pre-democratic form of government by a Council of the good and the great. Who appoints them? For how long? With what mandate delivered by whom?

    And then there’s the military – the army and the police. Who’s giving them their riding instructions and how long will they follow them?

    Mention of a racing metaphor – “riding instructions” which are given to a jockey by the trainer – suggests to me the appropriate way to look at what’s happening in Bangkok.

    As an adolescent and keenly interested in horse racing, I used to listen to a discussion between various tipsters broadcast every Saturday morning. Sometimes, when the glorious uncertainty of picking a winner led to complete confusion among the panel discussing prospects, the panel moderator, Bert Bryant would sum up and conclude with a single sentence: “And the answer is….a pineapple!”

    In Thailand, the answer is…..an orchid!

  • Andrew Podger – Health reform, co-payments, fee for service and doctor contracts.

    The recent suggestion of a modest user charge on patients of bulk-billing doctors, and the immediate reaction in the media, suggests the need for a more careful study of the appropriate role of co-payments in our health insurance system, and of other measures to contain costs while delivering an effective insurance product.

    Ensuring everyone has affordable access to effective health services, while keeping total costs manageable, is the central challenge for any health insurance system. The very existence of an insurer raises the risk of moral hazard whereby consumers and service providers take advantage of the third party payer. This is exacerbated in the health system by the reliance patients have on the expertise of doctors and the extent to which doctors, understandably, wish to draw on the latest technologies to help their patients.

    A fee-for-service system, as we have in Australia, adds to these problems, as doctors (and other health service providers) are rewarded financially by the number of services they provide, a variable they can influence particularly if the insurer meets all of the costs.

    There are several ways of addressing this issue, all of which involve insurers acting more as purchasers of services on behalf of their members, rather than simply reimbursing costs. A number are already used in the Australian health system.

    • Copayments send a message to consumers that services are not entirely free. They currently apply to pharmaceuticals up to a cap, even for concessional groups, and to non bulkbilling doctors particularly specialists. Private insurers typically leave substantial copayments for private hospital and related specialist services.
    • Gate-keeping may constrain the use of high cost services. This applies to specialist services which require GP referrals, and to elective surgery which requires specialist referral as well.
    • Hard or soft budget caps can constrain over-servicing. Hard caps used to be applied by the Commonwealth to its funding of public hospital services through the Commonwealth Health Services Agreement, and the States then applied as best they could soft caps. Soft caps also apply through Commonwealth agreements on MBS costs for pathology and radiology and, on occasion, to newly listed medicines through price-volume deals with pharmaceutical companies.
    • ‘Blended payments’, where fee-for-service is complemented by some ‘capitation’ funding based on patient populations, is a variant of the soft budget cap approach. This has become part of the regime for primary care through the provision of practice grants and rewards for certain preventive health outcomes such as high child immunisation rates, cancer screening levels and coordinated care plans for chronically ill patients.

    What is obvious is that our current approach is messy and not focussed on a system-wide strategy relevant to today’s challenges affected so much by chronic illnesses and the needs of the frail aged. There is the likelihood of continued over-servicing by bulk-billing GPs in particular, but also under-protection (and hence obstacles to access) for those unable to find a bulk-billing GP and for those referred frequently to specialists. The limited role of blended payments also means insufficient reward for preventive health services and high quality continuing care. There are also distortions such as people turning to (free) emergency departments for primary care services. Some international studies also suggest Australia relies too heavily on co-payments on pharmaceuticals (though Australians also pay large amounts voluntarily for ‘complementary medicines’ of dubious effectiveness).

    The suggestion of a modest charge on non-concessional patients of bulk-billing GPs would not go very far to address these problems. A better approach with the potential to achieve greater long-term savings to taxpayers would be:

    • To impose higher user charges on non-concessional patients of bulk-billing doctors, with a modest charge also for concessional patients (possibly akin to the current PBS co-payments);
    • To allow the States to apply similar charges for emergency department patients (and perhaps outpatients);
    • To tie these to firm caps on total eligible health service charges in any one year, thus ensuring a genuine and effective overall health insurance product;
    • To negotiate with GPs and specialists (or their corporate organisations) the mix of MBS fees and capitation funds required to ensure compliance with the standard fee regime and to promote improved preventive services and continuing support for at risk patient groups. These agreements, or contracts, could vary by region reflecting variations in the supply of doctors and the costs of service delivery.

    Private health insurers similarly should be encouraged to set total annual co-payment caps for their members’ hospital-related services.

    An early dialogue with the AMA and other doctor associations (including the Colleges which focus on professional standards rather than just doctors’ financial interests) could develop a manageable reform agenda. Regional variations would need to be negotiated, with the new Regional Primary Healthcare Organisations perhaps playing a role so long as conflicts of interest can be managed.

    This approach could be complemented by a more transparent system-wide budgetary control arrangement which helps to promote the optimal allocation of resources across programs to address health risks in the community. In the short to medium term, some notional health budget for the population in each region, with a soft cap, would assist allowing regions to negotiate agreements/contracts with doctors and other service providers within their notional budget cap to supplement or vary national fee-for-service prices, focusing in particular on the most appropriate support for the chronically ill and those at risk of chronic illness. (In time, private health insurers might play a greater role for their members including for Medicare services, by being offered their members’ Medicare ‘premiums’ otherwise managed through the regions’ budgets along the lines of the Bennett Report’s Medicare Select option).

    The Abbott Government will not want to ignite public doubts about its commitment to Medicare and so is likely to move cautiously. A balanced strategy that clearly improves Medicare’s overall insurance product while introducing a more coherent system-wide approach to co-payments might be attractive politically as well as economically.

    Andrew Podger was former Director General of the Department of Health and Ageing. He is currently Professor of Public Policy, College of Arts and Social Sciences, Australian National University.

  • Arja Keski-Nummi. They are us … and the language of war!

    Why are we using the language and methods of war against civilians fleeing war and persecution?  Asylum seekers are not our enemies. Our real enemies are our complacency and a willingness to turn a blind eye to the spin we are getting. This reflects the Abbott government’s ability to drill deep into our collective psyche of fear with our settler past. What if we lose it all?

    It conflicts so dramatically with our other self-image of an open, caring and welcoming society.

    This debate is about much more than people arriving by boat, it is about reshaping an Australian narrative that excludes and rejects difference. “In our image or no image” is the message. The High Court action against the ACT legislation on same sex marriages and Christopher Pyne’s curriculum review are part of that same agenda.

    In trying to turn the page back to an Australia that no longer exists and never in reality existed the Abbott government is using the asylum debate to send a message of “them and us”.  At best it is elitist. At worst it is narrow minded, bigoted and opportunistic. The problem is that the “them” eventually become “us” as over 200 years of migration – illegal and legal – has proven.

    Governments and politicians carry an enormous burden of responsibility in helping shape how we react and welcome the stranger.  We are the community and society we are because by and large governments understood that most people did not feel comfortable with immigration but if we were to grow and develop and be prosperous we needed people. Nothing has changed.

    The language used about asylum seekers by both the previous government and the current one however has sought to divide our communities. Little compassion is shown or expressed to the plight of people displaced by war and human rights abuses. Rather the language is about people cheating a system and a vow to not “let them get their way”. Disturbingly in the last few months the language of war has started to be used with greater frequency.

    While this may be playing out well in the polling of today, we will pay a price for such demonization. A cornerstone of our success in settling millions of people in Australia over the past 70 years, irrespective of how they may have arrived in this country has been that we have genuinely subscribed to the ethos of a “a fair go”, helping create the opportunities for people to establish new lives and participate in the broader Australian community while at the same time valuing and cherishing their cultural heritage and giving some of it to our own uniquely Australian society. We don’t have an underclass at risk of exploitation nor do we have ethnic ghettoes. Our settlement programs have helped avoid that.

    We do have vibrant culturally diverse suburbs that reflect our cultural make up. It is true that for some the process of settlement is difficult and not trouble free and will be so for a long time but a generation on the children of those arrivals are politicians and in professions creating new wealth and opportunities for all Australians. They are us. That is the time when we need to measure how successful we have been in welcoming the stranger, and by any measure we have been truly successful.

    The previous government’s decisions to lock asylum seekers out of work and the continuation of this policy by the current government will have consequences. We are creating a new underclass. People will have to survive and it is disturbing to contemplate where this may lead and not just into a thriving black economy. It is an own goal we could well avoid if we just recognized and capitalized on the resilience, toughness and determination to succeed that asylum seekers bring with them.   It is on these qualities that Australia’s wealth has been built.  Rather than spending billions of dollars on detention centres and offshore processing centres (where is the budget emergency now?) a little helping hand will in the long run be rewarded a hundred times over. We have two hundred years of evidence to prove that.

    Our problem today therefore has been of our own making. Currently there are no formulated political structures to counter the governments’ opportunistic and increasingly militaristic approach. The Opposition is caught in its own appalling policy paradigm, one which cleared the way for the Abbott government when they reopened Nauru and Manus Island and went still further to announce that no people detained in those centres would be resettled in Australia.   They seem to have forgotten what they stand for!

    Likewise the Greens show no great policy nous in this area having a simplistic, emotive response that ignores the reality of multiple issues colliding with each other including the very difficult issues of how to manage mixed migration flows, return of non refugees, countering people smuggling and support for refugees. Their starting off point is that everyone is a refugee. It leaves no space to contemplate the harder elements of a refugee and asylum policy.

    Emotionalism is not a substitute for a good political strategy.  We cannot turn back the clock and bemoan missed opportunities but nor should we simply accept the mantra of war. It is disrespectful to survivors of wars and betrays the shallowness of politicians who have turned civilians, seeking sanctuary, into enemies.

    What we need is an approach that engages our international partners and regional governments in finding genuine regional solutions and not the Orwellian ones of Manus Island and Nauru). We need to recognize the humanity of people seeking asylum but we also need to have a process that quickly identifies who is and  who is not a refugee and be able to resolve the immigration status of a person who is not a refugee quickly and with dignity even if this means return to their country of origin. To do anything less undermines our obligations under the Refugee Convention, a protection tool that has withstood the test of time. We must compromise the system of international protection that we as a country have worked so hard to shape.

    We have done it before. We can do it again and we can be true to our own self image of a caring and open society.

    Arja Keski-Nummi was First Assistant Secretary of the Refugee, Humanitarian and International Division of the Department of Immigration and Citizenship, 2007-2010.

  • Could we do more to offend the Indonesians? John Menadue

    Could we do more to offend the Indonesians? Yes, I think we could by appointing, as has been suggested, Peter Cosgrove as our next Governor General. He was the military Commander who led the INTERFET forces against the Indonesian military in East Timor in 1999.  This was much more than just a military defeat for the Indonesians. It resulted in Indonesia’s political humiliation in the eyes of the world. Indonesia had to withdraw from East Timor with loss of face.  I don’t think that Tony Abbott and Scott Morrison, in their reading of the Lonely Planet Guide to international relations would be aware of this. Stopping the boats is everything regardless of the human beings involved or our relations with Indonesia.

    I believe the Australian-led intervention in East Timor was justified and in normal times the appointment of a former military opponent of the Indonesians would largely go unnoticed. But because of the Abbott Government we are not in normal times in our present dealings with Indonesia; the country that is more important to us strategically than any other.

    The Abbott Government has trod clumsily and provocatively in our relations with Indonesia. It should not add to the problem.

    The phone-tapping of the Indonesian President, his wife and senior colleagues by an Australian security agency occurred before the Abbott Government came to power. But the insensitivity and amateurish response by the Abbott Government really caused annoyance in Indonesia.

    More unfortunately there has been our provocative policy of turn back of asylum boats to Indonesia. There is no doubt that the Indonesian Government feels quite strongly that this action has breached and continues to breach its sovereignty. In the ‘war’ on boat arrivals, the Abbott Government has ignored the collateral damage it has done to our relations with Indonesia.

    The Abbott Government has portrayed the humanitarian issue of asylum seekers and refugees almost entirely in the vocabulary of war. It has established Operation Sovereign Borders, a military operation led by the military.  To justify secrecy Tony Abbott says “if we were at war we wouldn’t be giving out information that is of use to the enemy” Scott Morrison says “this battle (against boat arrivals) is being fought using the full arsenal of messages..” With this sort of terminology it is not surprising that the Indonesians are alert to crossings of their borders by Australian warships. This unfortunate militarisation and vocabulary of war would also be exacerbated by appointing a former senior Australian General as our next Governor General.

    Discretion is important particularly when diplomatic relations become fragile. Discretion suggests that the Abbott Government should not worsen the situation by appointing a former military opponent of Indonesia as our next Governor General. In the Javanese way, the Indonesian Government may be polite on the subject. But it would be wise to avoid more potential damage particularly as the anti-Australian drum is likely to beat louder in this Indonesian Presidential election year.

    It should be recalled that in his military career, Peter Cosgrove in 2001 was the Chief of the Army when the Howard Government put SAS troops on board the Tampa to stop asylum seekers coming to Australia. I thought at the time that this was a highly political and partisan act to use the military in this way and that when matters had cooled General Cosgrove would stand down. But not so.

  • The power of vested interests and why drugs cost so much in Australia. John Menadue

    Why does the widely used cholesterol reducing drug Atorvastatin cost $A19 in Australia and $A2 for the same package in NZ? Why does the widely used cancer drug Anastrozole cost $A92 in Australia when the equivalent drug in the UK costs $A3.30. The answer is the political power of Medicines Australia and how it twists the arm of governments.

    In a blog on January 7, I drew attention to the political power of vested interests to undermine the public interest and good policy development in Australia. I referred  particularly to the miners and their role in destroying the super profits tax, the polluters’ opposition to the carbon tax, the hotel and liquor industry which is responsible for violence on our streets and poor health in the community, and the gambling industry particularly Clubs Australia, that successfully opposed proposals to shield problem gamblers. Just consider how James Packer has been able, so easily, to use his political power to avoid any public process in obtaining a licence for his “high-rollers” casino in Sydney.

    What makes these vested interests so dangerous is their power to persuade or threaten politicians. The media is ill-equipped to contest their power. In some cases, The Australian and the Australian Financial Review newspapers become outlets for these vested interests.

    Medicines Australia (MA) is a classic case. It represents the pharmaceutical industry in Australia. Its members supply 86% of the medicines that are available in Australia under the Pharmaceuticals Benefits Scheme. (PBS)

    The Grattan Institute has pointed out how, with the cooperation of pliant governments, MA has been able to exploit Australian consumers and taxpayers. The facts are quite clear. For March last year, the Grattan Institute reported as follows:

    • For Atorvastatin, the cholesterol reducing drug, the PBS in Australia paid more than $51 for a box of 30 tablets. NZ paid $A5.80 for a box of 90 tablets.
    • Grattan also looked at the ‘top 73 doses that are prescribed most often in Australia’. It found that Australian wholesale prices were eight times higher than NZ’s. For identical drugs, NZ prices were six times cheaper than in Australia.
    • Grattan also compared prices in some public hospitals in Australia who buy drugs outside the PBS. It found that on average these hospitals obtained drugs eight times lower than the prices under the PBS.

    Those comparisons where for March last year. In December last year, under what is called ‘price disclosure’ arrangements, prices were reduced.  However, the Grattan Institute found that even with these reductions, Australia was still paying sixteen times more than the UK and NZ for seven key drugs. For example the cost of Atorvastatin dropped from $A30 to $A19 for a pack in Australia. The same pack sold for the equivalent of $A2.84 in UK and $A2.01 in NZ. For Anastrozole, the cancer drug, the wholesale price in Australia is $A92 and in the UK $A3.30.

    How can these outrageous differences occur?

    Before a drug can be registered on the PBS it has to be cleared by the Therapeutic Goods Administration for safety and efficacy. Then it is assessed by the Pharmaceutical Benefits Advisory Committee for cost effectiveness and clinical benefit. The Pharmaceutical Benefits Pricing Authority (the Pricing Authority) then determines the maximum price that can be charged and how much the Government will pay manufactures or importers under the PBS.

    The Pricing Authority, a non statutory body is set up by the Minister and is within the Department of Health and Aging. The Authority includes, amongst its six members, two representatives of drug companies. That is extraordinary-building vested interests into the price setting process. They should be excluded completely.  The whole process is opaque, and political. It is ready made for manipulation by vested interests.

    In NZ, politicians decide how much is spent by the government on drugs and an independent and professional expert panel sets prices. In Australia we have the process the other way round. Our politicians should determine the budget for drugs at the beginning of the process and then get out of the way and let market competition work and leave final price decisions to independent experts.

    The vested interests get their fingers all over the price of drugs on the PBS. In NZ they are excluded from the process.

    Grattan Institute estimates that Australia’s wholesale prices for identical drugs are now six times the prices paid in NZ. In some cases they are as much as twenty times higher. Grattan Institute estimates a saving of almost $A2 billion p.a. if we paid the same price as in other relevant jurisdictions.

    The Chief Executive of MA is Brendan Shaw. He was formerly a staffer for Dr Craig Emmerson. It is typical of the pedigree of vested-interests and their political lobby that they choose persons well-known and influential in the political corridors of power in Canberra. .

    In response to Grattan’s findings, Brendan Shaw in the Australian Financial Review made an irrelevant point that because of budget restraints in NZ, fewer new medicines were available in that country. He avoided completely the issue of price comparisons. I would rather rely on the professional advice of independent experts on what drugs should be on the PBS and the prices we pay.

    When will we seriously tackle the exploitation of the public that Medicines Australia inflicts upon us?

    The Department of Health and Ageing should be spending its time developing and implementing improved health policies. Instead it spends its energy and time placating the powerful rent-seeking vested interests in our health services – Medicines Australia, the AMA, the Pharmaceutical Guild of Australia and the Private Health Insurance companies.

    The Rudd and Gillard Governments did little to curb the abuse of political power by these groups in the health field. In fact they made the situation worse. The Rudd Government appointed a senior executive of BUPA, the second largest private health insurance firm in Australia, to head the National Health and Hospital Reform Commission enquiry.

    Ross Garnaut described the power of vested interests in Australia as a ‘diabolical problem’.  He is right. If the Commission of Audit wants to save some real money and curb rent seeking it could start with vested interests like Medicines Australia.

    Governments and particularly conservative ones extol the virtues of markets. But all too often this is a diversion, designed to advantage corporations, like the members of Medicines Australia, rather than letting markets work and promote competition and lower prices.