Closing the gap to 2030

Closing_the_Gap_2015_coverIt was the anthropologist Bill Stanner who described Australia’s attitude to its Indigenous people as a “great history of indifference”. Stanner was speaking in 1963, just after Aboriginal and Torres Straight Islanders (hereafter ATSI) got the vote.

That decision began to bring Indigenous people into the Australian story, a process accelerated by the 1967 referendum that ensured “Aboriginal” people (ATSI people) were counted in the census and that the Commonwealth would have a role to play. One of the instigators of the referendum, Faith Bandler who died yesterday aged 96, wasn’t Indigenous but her polyglot Melanesian-Scottish-Indian background was emblematic of a new Australia that was gradually looking beyond the coattails of empire for inspiration, and prepared to dig deep for the descendants of its original inhabitants.

The story of Australia over the last 50 years has been one of an attractive, open, vast and vibrant country with great wealth and freedom, attracting people from all around the world., myself included. The conditions of ATSI people has greatly improved in that time but because they were starting from such a low ebb, they remain adrift of the general population in most statistical markers. That difference is stark to anyone not indifferent to Indigenous affairs. Their place on the census allowed economists to easily measure the state of the gap while Commonwealth involvement gave the problem a much needed national focus.

In March 2008, that great Svengali Kevin Rudd used his commanding popularity as prime minister to coax his new Australian Government and its Opposition in signing the Close the Gap Statement of Intent. Rudd hosted the Indigenous Health Equality Summit which committed to closing the health equality gap between Aboriginal and Torres Strait Islander people and non-Indigenous Australians by 2030.

The rationale behind the move was a dichotomy revealed by the UN Human Development Index which ranked Australia third in the world off the back of its mining boom. The score ranked Australia highly on such matters as life expectancy, employment, health and other indicators. Yet there was a nagging underside to that good figure. The life expectancy of an ATSI person was 17 years less than the Australian average.

The gap was a stark reminder of a great divide in Australia across education, incoming, housing, mental health, chronic disease, child and maternal health, access to health services and more. According to the Close the Gap campaign steering committee, the gap led to an immense and unnecessary burden of suffering and grief for ATSI people. For the rest of us, it was a “scar on an unhealed past” and a “stain on the reputation of the nation”.

Those scars and that stain, remind us why there is a gap in the first place and the impact is felt by the states as well. Victoria and Queensland got on board the Statement of Intent in 2008, WA in 2009, the ACT, NSW and SA in 2010. WA and NT have not yet signed up but the committee recognises that states have as big a role to play as Canberra. They are the ones who spend the Commonwealth tax dollar on health and education.

But it is Commonwealth who takes the lead, producing the Closing the Gap report since 2008. In this issue as in many others Rudd overpromised and underdelivered yet there has been much progress in seven years. The improvement is hard to see because while Aboriginal health has improved, the health of the general community is also improving. Thus we are failing to “close the gap” fast enough.

It is women who are bearing the brunt of the problem. In the last five years, Indigenous life expectancy has gone up by 1.6 years for men but just 0.6 for women. Both sexes still die 10 years earlier than non-Indigenous people, so the good thing is the gap has narrowed by seven years since 2008 and is a reminder that closing the gap takes a lot of continuous effort and time. That was shown in a similar experiment in New Zealand where it took 20 years to improve Maori life expectancy by four years.

Prime Minister Gillard never quite had the same focus as Rudd on Indigenous Affairs. She guided a minority government through a myriad of controversial issues but ATSI legislation never floated to the top of her term. In her final closing the gap report of 2013 she claimed victory on access to remote pre-schools admitted there was still a “massive and unacceptable” standard of living gap between Indigenous and non-Indigenous Australians.

Last year was the first Closing the Gap report of the post-Labor era. Like John Howard before him, Tony Abbott put great store in what he called “practical reconciliation” (in essence what this means is ruling any talk of self-determination off the table.) Again, like in the Labor years, the report spoke of the “stark reality of health inequality” and called for measures to reduce smoking rates, improve maternal and children’s health and to make inroads into chronic disease.

This year is much the same. Seven years in, the committee wants greater focus on access to primary health care services to detect, treat and manage Indigenous health conditions. They say they have evidence to suggest Aboriginal Community Controlled Health Services gives the best bang for the contested government dollar, providing wide-scale and quality access to health services.

The committee supports the federal government’s priorities of education, employment and community safety. But they also have concerns. They want the Closing the Gap strategy to have a “clearer connection” with the Indigenous Advancement Strategy. Education, employment and community safety lead to good health but good health is also important to driving education, employment and community safety. Health services is the bigger employer of Indigenous people so increased investment will lead to increase employment.

The year 2030 remains the target and by then we should see a further shrinking of difference between black and white. But “the gap” must remain a priority well beyond then. Indigenous injustices, shielded by settler indifference for 180 years, cannot be wiped away in a few health service schemes of a single generation. There must be a continued multi-partisan commitment to the removal of the gap for ATSI people as populations. But integration or assimilation is not the complete answer. There must also be a commitment to support the space for a gap so that ATSI people remain as distinct peoples with their own culture and languages, regardless of their health and employment outcomes.

Scott Buchholz and Pauline Hanson: why Queensland politics matters to Canberra

Pauline Hanson chats with a voter in Gatton (photo by Amy Lyne).
Pauline Hanson chats with a voter in Gatton (photo by Amy Lyne).

TWO events took place in the last two days that are arguably closely related, one in Australian federal politics and one in Queensland.

In federal politics the shenanigans (a lovely word meaning mischief that sounds as if it should be Irish and probably is via Tammany Hall) of #libspill week, ended with its first victim: chief whip Philip Ruddock. Journalists in the Canberra press gallery believe the father of the house was sacked because he badly miscalculated the size of the backbench rebellion in the party room.

The spill did not reveal who was ready to step into Tony Abbott’s shoes, the two likeliest contenders Malcolm Turnbull and Julie Bishop kept their powder dry, but the 39 MPs that voted for a spill of the leadership positions revealed a deeply wounded leader.

Abbott, as everyone knows, is a fighter and like the Black Knight will claim his troubles are just a flesh-wound and he has the wherewithal to continue to provide “adult government”. Philip Ruddock was the most senior adult in that government, an apparent moderate who oversaw spectacular success in implementing John Howard’s draconian anti-immigration policies to widespread electoral acclaim.

But he was never close to Tony Abbott and he was made a scapegoat yesterday losing his chief whip position to his deputy Scott Buchholz. Very few people outside of Canberra and a small part of south-east Queensland have heard of Buchholz, who is amiable man, though not a deep political thinker.

I met him once at the races in Roma and I liked his bonhomie and charm. He is well connected as the former chief of staff of Barnaby Joyce and a good businessman having run a successful transport company out of Toowoomba for 18 years.

He is also the federal member for Wright, a seat with a ridiculous shape (looking a bit like Iceland) that bolts together Beaudesert and the Gold Coast hinterland with the Lockyer Valley, with mountains dividing these dissimilar communities and no direct roads between them.

Its object is purely to form an electoral quota and its shape and scope is not dissimilar to the equally absurd Queensland seat of Lockyer, which almost played a big part in deciding the fate of the Queensland Government.

It took 13 days for a Palaszczuk government to be formed after the election and it took 12 days for Lockyer to be declared. Labor won the election and the LNP won Lockyer but if Pauline Hanson had got in, she would have been a major thorn in both their sides. Labor would be delighted that the low profile incumbent LNP party outsider Ian Rickuss (who had a hate-hate relationship with Premier Campbell Newman, but will be more in with Springborg) just held on, defeating Hanson by 114 votes on two-party preferences.

In other words, Hanson was just 59 changed votes away from getting a shot at the balance of power with independent Tony Wellington. I was disappointed with the result and wanted Hanson to get in, if only to liven the place up, but I admit I would have been nervous to give her such a shot at power.

While the election was in play, the left-wing Hanson haters all got their knickers in a twist in moral panic and castigated Lockyer voters for their “stupidity”. It was hypocrisy on a grand scale from people who believe Abbott supporters are always blaming the voters for bad polls. Sitting here in Lockyer it was easy to see her appeal, and she grabbed votes from the left, the centre, and the right.

Hanson is a serial candidate and her near success in Lockyer, and general wide approval, will encourage her to have another go in the area. She told me she has already signed up as a volunteer with a crisis care centre in Laidley. Her first shot at another campaign would have been the council elections of 2016 and perhaps a run at Lockyer Valley Mayor.

There are three reasons why that won’t happen. Firstly, she said herself, that won’t happen. Secondly, she is ineligible, living across the border in Scenic Rim council area. It didn’t matter in the state election, “where she put her head down of a night” as she put it (though it meant she herself couldn’t be one of the 59 votes she needed to turn the election around) but legally that is impossible in the council election unless she moves house. Thirdly she ran with the blessing of the current Lockyer Valley Mayor Steve Jones, a feisty old-style conservative figure linked to his relative Alan Jones, but one who hates the LNP and one who particularly detests Ian Rickuss. As a local journalist, I’ve had my ups and downs with Steve Jones, but Hanson is unlikely to want to cross him if she can help it.

A more likely strategy is for Hanson to run for Wright in the next federal election due by September 2016. Unlike Lockyer, she lives in Wright and can already count on a good vote from the Lockyer Valley. Beaudesert and the Coastal fringe will be more of a challenge but her public profile and rock star appeal in the electorate may get her over the line.

Labor preferenced her last in Lockyer and are likely to do so again in Wright. But 60% of Labor voters ignored their party how to vote card and put Hanson ahead of Rickuss. Also federal elections are not optional preferential like Queensland so voters have to vote all the way down the line.

Wright, of course, is held by Buchholz, a fierce supporter of Tony Abbott. Abbott, of course, was John Howard’s point man who ensured Pauline Hanson’s arrest and imprisonment for electoral fraud, a case ultimately overturned in the Court of Appeal after Hanson served three months in prison.

Hanson hates Labor, but has good motivation to hate Tony Abbott more. This is why Abbott has shored up Buchholz’s position with a promotion. A minority government in the 2016 election with Hanson in Canberra would be just as disastrous for Abbott (assuming he is still Prime Minister and not just a dead man governing) as it would be for Labor.

Power Failure: the tragedy of Australian climate politics

power failureThe book Power Failure about Australia’s intransigence on climate change was a personal mission for journalist Philip Chubb. Chubb lived with his family at Cottles Bridge near Melbourne and watched year after year as the summers got hotter. On Saturday, 7 February 2009 he stood in record-breaking heat with fire plan in hand hoping the blaze would not come over the hill and kill his family. They were lucky but Chubb’s closest friends died as they hid under the kitchen table, and it seemed obvious to him changes in the climate had fuelled the intensity of the fire.

But the reaction to Black Saturday showed there was still divisions and fears, played up by the likes of News Corp columnist Miranda Devine who said it wasn’t climate change but habitat protection promoted by environmentalists that caused the fires. Devine said “Greenies” should be “hanging from lamp-posts” for their ideology which prevented “landowners from clearing vegetation to protect themselves.” Devine could have been dismissed as a lunatic outlier, but she carried a big megaphone which her employers News Corp were more than willing to lend to anyone who muddied the waters when it came to climate change science.

The Prime Minister Kevin Rudd had recognised climate change as a national emergency when he won what some regarded as the world’s first climate change election in 2007. Many surveys showed seven out of ten people saying climate change would impact their vote. Rudd spoke of great moral challenges and pledged to reorganise the national economy around new energy industries. He introduced an emission trading scheme and appointed Ross Garnaut to examine the economic impacts and recommend a framework. It seemed as though intelligent and non-partisan debate about climate change had become the norm.

It wasn’t an easy problem to solve. The Australian Public Service Commission defined climate change in economic terms as a “wicked problem” – a pressing and complex issue involving many causes and much disagreement about possible solutions.  Australia’s reliance on fossil fuel worsened the problem with four out of five power stations running on coal, making the nation the world’s biggest per-capita greenhouse gas emitter. Private companies making money from fossil fuel industries also had a vested interest in climate policy failure over 25 years.

In 1990 the Bob Hawke government developed Australia’s first climate change policy aiming to stabilise emissions but not at the expense of the economy. Then in 1996 John Howard rolled back even these modest goals refusing to ratify the Kyoto Protocol and overriding advice to bring in emissions trading in 2003. Howard’s position was finally repudiated by the electorate in 20007. Post Black Saturday Rudd had the opportunity to go on the front foot. Chubb’s book forensically examines how that unravelled over the four years that followed leaving Australia further adrift than ever on effective climate action.

Many of the problems were of Rudd’s own making and his character flaws are discussed in detail in Wayne Swan’s autobiography. Rudd’s authoritarian leadership style led to deep dysfunction in many areas of government including climate change. Policy making was the preserve of the troika of Rudd, Swan and Penny Wong but with Swan absorbed in the financial crisis, Rudd and Wong were the only ones who fully understood Labor’s climate change policy. There was little or no inter-departmental or stakeholder consultation and most cabinet ministers were well out of the loop as power concentrated in the Prime Minister’s Office.

Rudd and Wong also kept the voters out of the loop as the policy took shape. The early enthusiasm for change dissipated in an information vacuum, crucially robbing Labor of using the threat of an early election to resolve a political impasse.  As the passion for action dulled in the absence of an information campaign, the Opposition hammered away to create doubt and weaken resolve while affected companies warned of loss of jobs and an investment freeze. The year dragged on in arguments over compensation to polluters, eventually agreed at an astonishing $7.3 billion, that the companies still weren’t happy with.

As 2009 advanced, Rudd had a pressing need to use his phenomenal personal popularity to lock in public support for climate action, but he said nothing on the issue. Nor was he open about the impact of carbon pricing on the cost of living. Because the community had stopped hearing about the issue, they started questioning its importance and whether it was worth paying for. Rudd had squandered consensus. Between 2008 and 2010 Newspoll showed an 11% drop in belief in climate change and by 2011 the proportion of Australians opposing action with significant costs had doubled. The breaking of the drought in 2009 also contributed to change in public perception with many equating climate change with a lack of rain.

Having abandoned the public, Rudd put his trust in the parliamentary opposition and global action at the 2009 UN climate change conference in Copenhagen. He would lose both battles. Rudd’s parliamentary failure was entirely his own fault. He wanted to pass his legislation in the Senate with the help of Opposition leader Malcolm Turnbull. But he also played wedge politics against Turnbull and Liberal moderates which eventually saw Opposition climate sceptics grab power in the party room. By then Rudd had alienated the Greens so there was no plan B.

The clumsily-named Carbon Pollution Reduction Scheme first hit the Senate in mid-2009 when Turnbull was still in charge. Turnbull held the line the legislation was hasty and pushed for delay. The Opposition voted against it but Turnbull was worried about fighting a climate change election so he promised to negotiate later in the year. By then Barnaby Joyce was openly calling the CPRS a ‘great big new tax on everything’ and said the Sunday roast would cost up to $150.

This simple scare campaign was inaccurate but devastating as the government had never conceded there would be any cost of living increases. Turnbull’s party room was openly grumbling about giving the government any support on climate change. Among them was Tony Abbott who told a September 2009 meeting in Beaufort, Victoria that climate change was “absolute crap”. The speech went down well with his older rural audience. Abbott would later say this was not his “considered opinion” but also admitted this meeting convinced him to act against the policy.

In November Penny Wong and Ian Macfarlane finally began negotiations on the CPRS. The resulting deal was good for the big polluters. The LNG industry got a top-up allocation of permits, the coal industry’s handout was doubled, there were more handouts to electricity generators, steelmakers and other manufacturers and the global recession buffer was extended to 2020. Turnbull was delighted with the result, but his party room was not. There was a spill on December 1 and Turnbull lost to Tony Abbott by one vote. Abbott immediately reneged on the deal and the climate consensus was finished.

Initially Rudd’s office was delighted by the result thinking Abbott would shoot himself in the foot. But he pushed hard on the simple message of the ‘great big new tax’ saying emissions could be reduced by other less costly means. Meanwhile Rudd’s hope of getting the Greens onside were destroyed by what was given away in the Wong-Macfarlane compromise. The CPRS was defeated a second time in the Senate in December 2009 despite two Liberal senators crossing the floor.

Rudd went off to Copenhagen undaunted, convinced by his ability to knock together world heads. The conference was chaotic to the point of anarchy with many different alliances and divisions at work. Rudd told delegates a grand bargain was within their grasp but no one was listening, and the conference ended without agreement. An emotionally drained Rudd blamed “Chinese fuckers” for trying to “ratfuck us” but it would be Rudd himself that would end up “ratfucked” in 2010.

Abbott began his onslaught buoyed by the failure of the summit and the release of hacked emails of climate scientists that sceptics gleefully suggested the environmental threat was exaggerated. Unable to openly embrace the sceptics, Abbott developed “direct action” to reduce emissions. Rudd became paralysed by doubt at the prospect of calling a double dissolution election based on the Senate’s refusal to pass the CPRS. He gave the impression to his supporters he would call the election in January so many staffers cancelled holidays to work out a campaign. Rudd’s supporters later claimed Julia Gillard talked him out of that election though Gillard said it was Rudd’s idea.

By Australia Day Rudd had abandoned the election idea and was instead promoting his health reforms. In early 2010 UK climate sceptic Chris Monkton toured Australia, garnering public legitimacy through blanket media coverage. Abbott met Monckton and later parroted some of his views. Rudd was nowhere to be seen. Instead he looked at an abatement plan that was suspiciously similar to Abbott’s direct action and just as useless in meeting serious targets. But this “Abbott lite” plan did give him an excuse to indefinitely delay the CPRS. The decision was leaked to the media in April and Rudd publicly admitted it was pushed back to 2013 unless there was “credible action” in China, India and the US.

The impact was disastrous and immediate. The Coalition had their first lead in the polls in four years and Rudd’s personal approval rating dropped 15 points. The disaffection quickly spread to the party room tired of a command and control leadership style that had little substance. By 24 June, he had vacated the leadership without a fight. Julia Gillard took the reins without explaining to the public the darkness at the heart of government leaving Rudd to successfully play a martyr role for the next three years.

Gillard’s immediate poll numbers were encouraging but it was a short honeymoon. On climate change Gillard pushed to restore consensus with a citizens’ assembly. The idea was ridiculed as “a giant focus group” and an excuse for inaction. Climate change did not feature much in the 2010 election. Abbott reiterated his doubt of climate science while Gillard publicly ruled out a carbon tax. The campaign was a disaster for Labor as Rudd camp leaks constantly undermined any momentum. The election produced a hung parliament and a tug of war for the balance of power.

Labor signed a formal alliance with the Greens which was widely derided though Gillard felt it would provide momentum for negotiations with the other independents and have constitutional weight with the governor-general. The decision spawned outright war in the Murdoch media stable against the government, a war which would not cease until the next election. Andrew Wilkie signed up with Labor leaving the decision of government with independents Rob Oakeshott and Tony Windsor. Despite being former Nationals the pair cared deeply about climate change and consulted with Garnaut and Nicholas Stern to work out their position. They agreed to go with Gillard demanding a re-examination of the carbon price, an updated Garnaut Review and a productivity commission study of international action on emissions reduction schemes.

Gillard appointed a Multi-Party Climate Change Commission (MPCCC) but the Opposition did not sign on. The MPCCC made good progress and within six month came up with the framework for the Clean Energy Future package. But a leak in February 2011 would change everything. The Australian revealed Gillard would introduce a carbon tax in 2012 and an ETS in 2015. Gillard and Bob Brown formally announced a fixed carbon price would begin on 1 July 2012. Gillard told parliament Australia had to put a price on carbon early to manage inevitable change. Abbott called the carbon price a tax and said he would campaign constantly against it. Later that night Gillard went on ABC’s 7.30 where she could have described the new fixed price as a charge on the country’s biggest polluters. Instead she admitted she was happy to call her “market-based mechanism to price carbon” a tax. The damage was done, Gillard had lost the next election there and then.

Immediately the Opposition went on the attack calling Gillard a liar and the reputational damage was irreparable. Gillard was stuck in a losing battle of semantics reflected in abysmal polls that lasted the full term of her government. The Opposition colluded in a very public campaign of intimidation that bordered on violence. It legitimised scepticism in a scare campaign with five parts: unimaginable price rises, huge power bill rises, the destruction of coal, steel, cement, aluminium and motor industries, thousands of job losses, and the death of regional towns.

The media went along for the ride constantly calling out the negative impacts of the carbon price. When Cate Blanchett advertised support of carbon pricing, she was lampooned in the press for a week as a “pampered star” and “Carbon Cate”. Despite the ferocity of the attacks, the government said nothing. Gillard was making the same mistake as Rudd: ignoring the voters while the details were being thrashed out. Gillard’s silence was deliberate, she didn’t want to antagonise support in the MPCCC but the effect was the same: public disdain. Her approval rating plunged to 17%, equal with the worst rating of Paul Keating.

The government was in dire straits but took heart in the electorate’s suspicions over Tony Abbott. What they could not deal with was the return of Kevin Rudd. Rudd’s backers asserted Labor could still win the next election with him at the helm. Despite the mayhem, the Government introduced the Clean Energy Fund in June 2011 and Gillard successfully marshalled it through parliament. The carbon tax would be introduced a year later at the European price of $23 a tonne giving the electorate 12 months of “lived experience” of carbon pricing before the election. Labor also gave $10b over five years to a new Clean Energy Finance Corporation, a green investment bank idea borrowed from the UK.

Finally the government gave thought to the communication strategy. Its research said to avoid explaining climate change or justifying carbon pricing. Instead they were going to immunise the public by paying them off. But when it came to the “lived experience” people could not easily determine if the effects were good or bad. Abbott’s claims that the world would fall in were entirely wrong but dissatisfaction remained at rising costs, with massive electricity price spikes due to rising network charges. And Gillard’s hope for “clear air” to explain the package ran into a renewed Rudd leadership challenge.

The leaks and briefings escalated in 2013 and by June the destabilisation had made Gillard’s leadership untenable. But the collateral damage was intense and Rudd and Labor were swept from office in September 2013. The summer of 2012-2013 was the hottest on record but that was of no interest to the new government. The opportunistic new Prime Minister Abbott moved quickly to axe the Climate Commission, abolish the Climate Change ministry and appoint a climate sceptic to review the Renewable Energy Target.  The victory of the sceptics, however temporary, has left the “wicked problem” of climate change as far from a solution as ever. Hopes for a consensus remain poor as long as the Abbott clique remains in power. As Chubb writes, Australia could long rue its power failures between 2008 and 2013.

Wayne Swan still in the ring for ‘The Good Fight’

swanAustralian male politicians like their violent metaphors especially when describing their own exploits. Tony Abbott’s autobiography Battlelines reflected his pugilism while one of his former opponents, former Labor deputy PM and Treasurer Wayne Swan, prefers to be remembered for “The Good Fight”. Swan was my local MP and as I started my journalism career I interviewed him before the 2007 election (an interview for which I remain extremely grateful – his LNP opponent turned me down). Swan batted away my questions with aplomb, but tougher questions were coming. Labor, of course won that election, and Swan was installed Treasurer of a country about to sway in vicious global headwinds. His Good Fight was just beginning.

He begins the book in early January 2008 while on holidays at the Sunshine Coast with a recollection of a phone call from his American counterpart. US Treasury secretary Hank Paulson was worried by an economy buffeted by a sub-prime mortgage crisis that started in mid-2007. US housing prices were falling and the country was in recession. Paulson told Swan a recovery was possible but only if there wasn’t a “meltdown” in housing prices. Swan’s Treasury advice was that global risks were substantial but Australia was well placed to ride it out. His holiday reading of Alan Greenspan’s memoir combined with a biography of Australian depression-era treasurer EG Theodore brought the fear of another collapse home to him and made him realise the next few years would not be “an easy cruise”.

Though it started in 2007, the prospect of a financial crisis made little impact on the election that year. It never came up in discussion in my own interview with Swan and I was not alone – neither the media nor the Treasury saw it as a live issue. The priorities of the incoming Labor government were carbon pricing, water reform and federal financial relations. The massive overspending of the final years of the Howard Government had led to inflationary pressures and interest rates were on the rise thanks to China’s enormous appetite for Australian iron ore. Labor, keen to be seen as economically cautious, committed itself to a 1.5% budget surplus and its razor gang went in search of savings. By the time of its first budget, interest rates had risen to over 7% though the sub-prime crisis in America rumbled on. Swan had just returned from IMF meetings in Washington which predicted world losses of 1 trillion dollars. Swan was walking a tightrope between global turbulence and an overheated Australian economy, a paradox expressed in talking points as “countervailing forces”.

The budget promised $33b in savings but only $7b in the first year, which caused The Australian to complain it didn’t tackle inflationary pressures. But Swan’s American experiences meant he didn’t want to ‘slam the economy into a wall’. That wall was fast approaching and by August 2008 Swan was discussing the possibility of a recession with officials. Treasury boss Ken Henry told him if a stimulus was needed, it had to be 1% of GDP, about $10b. The June National Accounts showed just 0.3% of growth, not a recession, but very close. On September 7, US mortgage underwriters Freddie Mac and Fannie Mae had to be bailed out by Washington. Then a week later came the collapse of Lehman Brothers. A day later AIG also needed a Federal bailout. Immediately credit markets froze and investors ran for cover. Swan admitted it was terrifying news but publicly said Australian ‘fundamentals remained strong’. An extraordinary week ended with a US $700b financial rescue plan to mop up toxic assets.

The first Australian response was to buy $4b in mortgage-backed securities to keep the flow of credit and preserve mortgage competition. When US Congress voted down the rescue package, the Dow plunged 7%, the ASX down 4% the following day. The RBA cut interest rates by a full 1% and Henry advised Rudd and Swan to ‘go early, go hard, go households’ on a stimulus especially with a slowdown on Chinese growth. The stimulus came in at $10.4b targeted at pensioners and low-income earners in time for Christmas. Half the surplus was gone in one hit and Swan’s staff prepared for an even bigger second package. The world was a different place from 2007. The G7 was recording negative growth and global stocks had lost half their value. Rock bottom had not yet been reached.

Swan was “rewarded” with growth of 0.1% which meant recession was technically avoided but the knock on effects of the global crisis were starting to hit.  More policy levers were pulled. The government established the OzCar special purpose vehicle to provide liquidity to car dealer financers, brought forward transport projects, and people were encouraged to spend their Mark I stimulus bonus. Mark II would cost another $42b, 4% of GDP, including a $900 ‘consumption payment’ for individuals, the school Building the Education Revolution program and the insulation program for 2.7 million homes. The idea was that for every dollar providing immediate stimulus, another $2 would have future benefits.

With the Opposition’s wait and see approach against the package, the government negotiated with cross-benchers including Nick Xenophon who wanted a water buyback scheme. The December quarter had negative growth of 0.5% with the global economy expected to contact 1% in 2009 so the pressure was on for the next three months again to avoid recession. Swan’s second budget would be the victim of massive write-downs and unemployment around 0.5%. It project a deficit of $7b though as Swan called ‘a massive own goal’, he never mentioned the actual figure.

He was on safer ground when he said Labor protected Australia against the brutality of a global recession. His strategy worked – Australia recorded 0.4% growth in the March quarter and technical recession was avoided once more. With the worst of the GFC apparently over, there were calls to halt or decrease the stimulus. Swan held the line that growth was still weak and stimulus filled the gap. There was now a ‘two speed economy’ with coal and gas demand rising in 2009-2010 pushing the dollar up while other industries stagnated. GDP growth continued around 0.5% for 2009.

The story of slow recovery continues in the second half of Swan’s book. But it is overshadowed by growing political conflict between Kevin Rudd and Julia Gillard. Swan begins with the July 2009 backflip by Malcolm Turnbull on Opposition support for a carbon price. Rudd ordered ministers to negotiate with the Liberals on the Carbon Pollution Reduction Scheme but also told them to deliberately drag it out to extract maximum political advantage. It was a fatal miscalculation. Rudd dithered on forcing the double dissolution on carbon and pinned his hopes on a world climate agreement in Copenhagen in December 2009. His failure there sent him into meltdown, according to Swan.

By then Turnbull had been replaced by Tony Abbott who called the CPRS a ‘great big new tax’. Rudd went to Christmas without making a decision on 2010 strategy while Swan was tied up with the Henry Tax review recommendation to introduce a mining tax. In the New Year Rudd threw his energies into a federal takeover of the health system leaving Swan and Gillard to carry the messy CPRS and mining tax. In April Rudd announced the CPRS would be delayed three years.

May 2010 brought the fight over the mining tax. Swan said mining profits in 2008-2009 were $80b higher than 10 years earlier but the government was only collecting an additional $9b in revenue. Royalty and resource charges had reduced from 31% to 14%. The industry, the Opposition and Murdoch newspapers said the world would cave in if the tax was implemented and the scare campaign ramped up with slick advertising. Rudd’s stratospheric poll numbers collapsed exposing his weak support in the party room.

Swan said he was a reluctant starter on the idea of replacing Rudd with Gillard. “I could see Kevin was leading us into the wilderness,” he said, “but I was torn between the dread of that and the undoubted ugliness that would accompany his ousting”. Swan said Rudd was prone to vengeful behaviour and over-centralised leadership due to a “pathological fear of leaks”. He dragged meetings on for hours without making decisions and complex briefing papers went unread.  There was high staff turnover in his office.  A Labor mauling in a NSW state by-election was partially put down to federal issues and by mid June 2010 Gillard was ready to challenge.

Swan knew removing a popular first-term PM was dangerous but saw it as unavoidable. When the spill came, Rudd did not stand. Swan said this robbed the party of a frank debate in the party room. Swan said he felt sorry for a man he had worked with since their days in the Queensland Goss Government from 1989 and their families had been close for a decade with Rudd a godfather to Swan’s only son. But he was now deputy prime minister under Gillard.

They focussed on three problems: climate change, asylum seekers and the mining tax.  They hammered out a deal with the big mining companies that dropped the profits-based tax from 40 to 30% and applied to iron ore and coal only.  It cleared the way for a 21 August election. Rudd remained in the spotlight and his strategic leaks damaged Gillard who didn’t help her cause with her talk of ‘the real Julia’.   There was a sizeable swing against Labor in an election that ended in a draw. Swan narrowly retained his seat.

Suddenly the independents held the balance of power and after 17 long days and a $11b costing blunder by the Coalition, Windsor and Oakeshott gave the reins of power to Gillard. Swan thought minority government was suited to Gillard’s collegiate style but he later realised it suited Rudd too.

While Australia was recovering, Europe remained in strife and Treasury was making plans for a second GFC. Swan had reduced government spending but revenue shortfalls were making return to budget surplus more difficult by the day. Swan’s budget revenues had declined by $160b in 2007

Natural disasters like the Queensland floods and Cyclone Yasi were costly and the Japanese tsunami and the Auckland earthquake also suppressed demand. Though unemployment was down to 5.1%, the lowest in the industrial world, the budget fetish meant the media roasted Swan in December 2012 when he finally admitted Australia would not return to surplus in 2012-2013.

Kevin Rudd’s leadership ambitions emerged openly in 2012. He resigned as foreign minister in February over a perceived slight by Simon Crean. Gillard called a leadership ballot and beat Rudd 71-31. Rudd slid off to the backbench but immediately started work on his return.

Labor pressed on with the NDIS and Gonski reforms, but their hopes of getting ‘clear air’ were destroyed by issues such as Speaker Peter Slipper’s and Labor MP Craig Thompson’s legal problems.  Rudd’s strategically-timed leaks also caused media disasters.  On March 21 2013, Simon Crean engineered another leadership challenge, apparently promised the deputy PM position by Rudd. But Rudd didn’t take the bait forcing Crean to resign.

In Swan’s final budget he funded Gonski and the NDIS over ten years by closing corporate tax loopholes.  With Gillard’s poll numbers never recovering from her broken promise on carbon taxing, Rudd was irrepressible. By June 2013 commentators were openly saying Gillard would not make it to the election. Gillard called a third spill on June 26 and lost 57-45. Swan resigned as deputy leader and treasurer. Rudd’s three year war of attrition had succeeded. But the cost was too high. Though Australia’s economy had grown 14% since the GFC, Australians did not feel better off. Labor’s leadership turmoil added to the sense of disgruntlement. The trenchant criticisms of Rudd made by Swan and other senior leaders after the failed March coup would haunt Rudd in the election campaign which was one disaster after another. As Swan said, Rudd’s campaign was only “selfie deep”.  By election day, many were predicting Labor would have been better off sticking with Gillard. Rudd lost comfortably to Tony Abbott.

Swan’s “good fight” went on to his own election in Lilley, which he won “against the odds”. It was one of Labor’s few success stories on the night. Swan said Rudd had a plan for getting rid of Gillard but not for ruling the country. Swan said his own political philosophy was ‘where do we stand?’ not ‘what’s in it for me?’  Whether Swan’s fighting instinct still has something in it for him remains to be seen. Though now in opposition and on the back bench, the call remains. “For me,” he concluded, “the good fight will never be over.”

Victorian bells toll for Federal Liberals

On this morning’s edition of Insiders, Federal Trade Minister Andrew Robb tried to explain why his Victorian Liberal colleagues loss in yesterday’s state election had nothing to do with the Federal Government. The problem was not a new one, he said, they were down in the polls by the same “flatline difference” for at least three years. Robb was undoubtedly correct in his assessment but left himself open for an obvious retort, which interviewer Barrie Cassidy quickly pounced on. Wasn’t this what was happening in Canberra now, he asked. A somewhat flummoxed Robb ask what did he mean. Cassidy repeated Robb’s point that the Abbott Government were also flatlining in the polls. Robb quickly adjusted his radar and said ah that was different, they still had two years to improve their position.

Robb was granting his government the gift of the future, the same gift the Victorian Government had two years ago. It was a present Melbourne could not open and there is little reason to believe Robb’s colleagues will be similarly blessed. The Abbott Government is hopeless adrift and compromised fatally by the raft of promises and resolutions it made in opposition it could not possibly fill in government, especially when its right-wing credentials started to be felt as soon as it took office.

There are plenty of warnings for Abbott in Denis Napthine’s defeat overnight not least of which is the fable Australians will not dismiss a first time government. It might be the first time it has happened in 60 years in Victoria but federally the electorate is lot more volatile. The newly elected governments held on in their first elections in 1984, 1998 and 2010 but all were extremely tight and in all cases the incumbents had the preferred Prime Minister. This time round the Government is in freefall with an increasingly unpopular Prime Minister whom it becoming charitable to call hapless. Their management of the Senate independents is execrable and their few policy victories have had to be shared with Clive Palmer.  Tony Abbott’s one area of strength seemed to be as a world leader especially in the wake of MH17 but he squandered that goodwill with his idiotic shirtfront comment and then looked like a bumbling, provincial and irrelevant fool as he hosted the G20 meeting.

The silly games his government played to keep climate change off the agenda rebounded badly and he is unlikely to garner much credit even if they succeed in the economic imperative of 2.1% world growth. The slogan “it’s the economy, stupid” is itself stupid and does not take into account confidence levels and perceptions of a shambolic leadership. Victoria’s economy was in good shape before this election as was Australia’s economy before the 2013 federal election. But Victoria was undone by the wrangling over Geoff Shaw and Labor was fatally debilitated by the Rudd/Gillard wars.

Federal Labor leader Bill Shorten has been castigated by the left as a ‘do nothing’ politician but he remains popular and was able to assist in the Victorian election campaign to help a similarly anodyne but effective leader Daniel Andrews. Meanwhile the Abbott brand was considered far too toxic to be seen anywhere south of the Murray this last month or so.

Abbott once famously called himself a weather vane. He must be aware that heavy storms are coming his way, especially as he tries to chart a course for a second budget while still negotiating the tricky reefs of his first one. Treasurer Hockey has been a poor performer in the first year, but the people will blame Abbott not him.
As Insiders also pointed out this morning, Abbott’s Prime Minister’s Office is becoming as notorious as Kevin Rudd’s for its obsessiveness with the message and its failure to deliver. Whether that is a problem with the office or the man is a moot point, but it is looking like a doomed Prime Ministership.

Abbott will face his reckoning either massacred at the next election, if he is lucky, or more likely stabbed in back by his own colleagues next December as panicked parliamentarians look to someone else, anyone, who can help save their skins. It will be, as Andrew Robb inadvertently pointed out today, already too late. The Liberal goose was cooked in early in 2014 and will uneaten and poisonous on the table until Labor feasts on its entrails in 2016.

Budget facepalmer

The medieval theatre of the set-piece nonsense of lock-ups, Treasurer speeches and Opposition replies are over and now it’s down to the horsetrading to get the budget through. Until June 30, the balance of power in that unrepresentative swill of a Senate remains stubbornly with the Labor and Green alliance. The much vaunted elimination of the carbon and mining taxes still hasn’t happened and Labor-Green can afford the budget similar treatment, by simply echoing the Abbottesque-howl of “broken promises” and reject every negotiation between now and the end of June.

But if the budget remains in limbo on July 1, then the numbers in the Senate will change. Labor-Green will lose the balance of power and the government can look to six of the 10 independents and minor party seats to get their budget – and their broader agenda – through. The inconsistently brilliant operator Clive Palmer oscillates between acting magnificently contemptuous – including finding parliamentary theatre so dull that it sends him to sleep – and then revealing his hand with his willingness to ditch carbon pricing as well as demand retrospective payments for previous carbon taxing expenditure.

Sitting alone in the green chamber, Palmer can hold the stage but it is in the Upper House where his strength will be revealed when three Palmer senators and his patsy Ricky Muir will dance to his tunes. Perhaps this is what the current government is betting on as it launches its strange ‘war on everything’ budget. Of course, it is not war on everything, war itself is one of the few budget winners. But attacking such normally supportive vested interest groups such as pensioners, large families and motorists is expensive political capital being expended in the first year of government.

Fiscal prudence is a good thing, but to say Australia is living beyond its means is meaningless until we fully examine what those means are. Joe Hockey’s budget presumes a crisis but neither he nor Abbott can successfully say why this is so. Shorten exposed that with his facts and figures about what state Labor left the economy in September. But again it is Palmer who goes straight to the point and labels the emergency a fraud.

Where I draw a point of difference with Palmer, is that there is a genuine emergency. If say, the entire budget was put at the mercy of say, solving the problems of climate change, then there a Prime Minister would have a good case to sell to the nation. Such a notion still lies far outside Australia’s political Overton Window, the view vigorously policed by a media more willing to ridicule than to assist, and a host of Murdoch apparatchiks all too willing to impress the boss.

It is Murdoch’s flagship that wants to destroy the Greens at the ballot box. It is his journalists that are nitpicking Palmer’s career. It is his tabloids that built up Rudd to smash Gillard and then Abbott to smash Rudd. What is clear from all this is that we should be destroying Murdoch at the ballot boxes and launching campaigns NOT to vote for whoever they are recommending. What’s good for Murdoch, is only good for Murdoch.

The man he annointed, Tony Abbott, is now a rabbit in the spotlight, agonising over his every word between a mess of ums and ahs. I heard him described last week as first postmodernist PM (surely that was Kevin Rudd?) as someone who swaps ideologies and convictions at whim. It is hard to know what he believes in apart from three word slogans and being a weathervane. It is hard to imagine what influence he has in a heavyweight party room full of masculine ideologues other than getting the occasional “captain’s pick”. Quaint cricketing analogies worked for John Howard because he loved cricket. Abbott on the other hand sounds like a dill when he says it. And his “picks” like PPL, which on face value is a good thing, end up ditched hated by the left as inferior to childcare and by the right as too expensive. No wonder it barely featured in the budget that was a running sore of bleeding cuts.

The deficit was the excuse, but making government smaller is always an avowed aim of the Liberal Party. Apart from the innate belief that private sector will do everything better (excepting police and defence forces) and the downsizing of pesky organisations partial to inconvenient truths, they also want to reach into Menzies’ playbook to create a nation of “lifters” not “leaners”, a variant on the similarly catchy “hand up” not “hand out” philosophy. Despite the 1950s language, this is no bad thing of itself. In our most disadvantaged community, the Indigenous community, there are many voices saying that is precisely what they need. People like Noel Pearson and Marcia Langton are saying end the ‘sitdown money’ and instead give the communities the means to look after themselves.

This argument appealing to personal dignity, also works at the wider level where people who are not contributing to the economy should be encouraged to do so. The problem is that Hockey doesn’t leave those on the bottom with any dignity at all. His approach, is all stick and not a skerrick of carrot. The leaners are not given anything to lift. The government knows that motivating people by taking away their allowances rarely works, which is why it won’t bring in many new income-related taxes. But while it understands that wealth creation by the well-to-do needs a bit of leeway, it does not offer the same privileges to the less well off.

No one can honestly say how things will pan out when Palmer becomes kingmaker. The ultimate sanction of a double dissolution would likely only leave him in an even stronger position. The government may hope he is generally on their page as a former LNP member with similar economic outlooks. But as the actions of the similar disposed Tony Windsor and Rob Oakeshott showed, there can be much cantankerousness as well as honour and wisdom in independence. There will also be much bluffing to come. But Palmer is holding four aces and willing to gamble them to gain an even better hand.

Donnelly applies the whitener to Australian history

A few years back there was an ad campaign based on people’s ignorance of Australian history. According to the ad, everyone knew George Washington was the first US president but no one could name Australia’s First Prime Minister. The ad itself ensured that the name of Edmund Barton, if not his legacy, was at least temporarily remembered.

What the ad was trying to do was to encourage more interest in Australian history, but therein lies a problem and a likely clue as to why no-one knew his name in the first place –  it is a contested space and full of cobwebs many want to remain undisturbed. One of Barton’s first acts as Prime Minister was to introduce the White Australia Policy telling the country’s parliament in 1901 that Melanesian Kanakas were inferior to Europeans and they (the white parliamentarians) were guarding the last part of the world where ‘the higher races can live and increase freely for the higher civilisation’.  Barton’s point of view was shared by most white Australians in 1901, but these days is more than a bit inconvenient for anyone wishing to laud the positives of Australia’s past.

This is Kevin Donnelly’s problem when he speaks about the Australian education system. The curriculum should be impartial and disinterested, he said, and should be based on the search for wisdom, understanding and the truth. This is motherhood stuff and a hint of what he is really complaining about comes when he bemoans the lack of focus on western civilisation and Judeo-Christian teaching in Australian history.  In some respects, Donnelly’s complaint is codswallop, as religion and western civilisation pervade all aspects of our educational system. But given his focus on Australian history and his concern those values are being “airbrushed” from the education system, Donnelly might not like it, if the truth was really told.

How, for instance, would you apply western civilisation and Judeo-Christian values to the question of why the Europeans came to Australia in the first place, uninvited and with a self-given mandate to take over?  How much was western civilisation and Christian values at fault when those that did come to Australia felt superior to those that lived here before, unwilling or unable to recognise Aboriginal culture when they didn’t see cities, councils, cathedrals or crops? How might civilisation and culture explain why the Europeans destroyed what went before, treating Indigenous people like either vermin to be killed off, animals to be tamed,  or children to be educated in white ways?  Or why those that came in the name of religion at missionaries and churches treated natives like slaves and their children like souls to be bartered off to the highest bidder?

Why was it a Barton-led nation at Federation determined Australia would be for whites only, preferably British, and the Aboriginals were no better than flora and fauna?  Would that religion explain our nation’s fetish for war – as long as they weren’t ones that took place on native soil? Would the “Judeo” bit explain Australian anti-semitism between the wars and the country’s refusal to take in refugees from Nazi Germany? And why did the various branches of the “Christian” bit hate each other so much and leave a legacy of bitterness and bigotry that spanned generations?

Maybe Donnelly might tell us which aspect of western civilisation and Judeo-Christian heritage explains why in 2014 we are such a pack of bastards when it comes to letting others into the country and then washing our dirty immigration laundry in other people’s sinks. Never mind complaining about the new $8000 media visa into Nauru, why not examine the circumstances by how we permit this vile charade to happen?

Maybe too, Donnelly might have a quiet word with the marketing managers at Aldi and tell them why t-shirts with “Australia Est 1788” mixing snappy corporate branding with unfunny, inaccurate history is not such a good idea.

But I suspect Donnelly will do none of those things, being more keen to wallow in the reflected glory of western civilisation and religion celebrated than explore the murky shadows of their massive blind spots. The common point in all these questions is the selectiveness of what we choose to remember. Donnelly wants us to ignore the elements that make us feel uncomfortable and bask in those that make us feel good.  His views are a proxy for those who want to paint a clean veneer of white-picket fence philosophy onto the messy and complex canvas of modern Australia.

Kevin Donnelly is doing the donkey work for more powerful actors. This pandering to Anzacs and Gallipoli is leftover secret men’s business from the days of the Howard government with many of the same players in the same positions of power to finish off the agenda. This is not education, this is cultural indoctrination.