The Chinese embassy has lashed out at two Liberal members of parliament, Andrew Hastie and James Paterson, saying they would need to “repent and redress their mistakes” before they would be welcome in China.
The attack came after the pair, strong critics of the Beijing regime, were refused visas to take part in a trip sponsored by the think tank China Matters.
In a statement late Friday regretting they had been refused entry, Hastie and Paterson said they were “particularly disappointed that the apparent reason why we are not welcome in China at this time is our frankness about the Chinese Communist Party”.
They added they would “always speak out in defence of Australia’s values, sovereignty and national interest.”
The embassy hit back, saying:
The Chinese people do not welcome those who make unwarranted attacks, wantonly exert pressure on China, challenge China’s sovereignty, disrespect China’s dignity and undermine mutual trust between China and Australia.
As long as the people concerned genuinely repent and redress their mistakes, view China with objectivity and reason, respect China’s system and mode of development chosen by the Chinese people, the door of dialogue and exchanges will always remain open.
Both Hastie and Peterson said on Sunday they would not be repenting.
China Matters has postponed the study tour, which was due to take place next month.
It said the goal of the tours it sponsored was “to facilitate free-flowing, off-the-record and informal discussions” with citizens in China.
In previous tours “no issues have been left unaddressed, including our concerns about the plight of Uighurs in Xinjiang and the ongoing protest movement in Hong Kong”. It was “unfortunate” the politicians’ names had become public before the visit, China Matters said in its statement.
China Matters describes itself as “an independent Australian policy institute established to advance sound policy and to stimulate a realistic and nuanced discussion of the PRC among Australian business, government and the security establishment.”
The government is trying to keep out of the controversy, saying it was a privately sponsored trip.
Labor frontbencher Stephen Jones told Sky:“I think because of the mismanagement of this government, we’ve got relations with China probably an all-time low”.
Meanwhile Foreign Minister Marise Payne said the leak of top secret documents published by the New York Times showing the treatment of Uighurs and other minorities reinforced concerns previously expressed by Australia.
The New York Times reported that the more than 400 pages, leaked from within the Communist Party, “provide an unprecedented inside view of the continuing clampdown in Xinjiang, in which the authorities have corralled as many as a million ethnic Uighurs, Kazakhs and others into internment camps and prisons over the past three years”.
Payne said: “I have previously raised Australia’s strong concerns about reports of mass detentions of Uighurs in Xinjiang.
“We have consistently called for China to cease the arbitrary detention of Uighurs and other groups. We have raised these concerns – and we will continue to raise them both bilaterally and in relevant international meetings.”
Among them are macroeconomists, economic modellers, former Treasury, IMF, OECD and Reserve Bank officials and a former government minister.
The Bank needs help
At issue is the government’s contention, spelled out by Frydenberg’s treasury secretary Steven Kennedy in evidence to the Senate last month, that there is usually little role for government spending and tax (“fiscal”) measures in stimulating the economy in the event of a downturn.
Monetary policy – the adjustment of interest rates by the Reserve Bank – is nearing the end of its effectiveness in its present form. The bank has already cut its cash rate to close to zero (0.75%) and will consider another cut on Tuesday.
It is preparing to consider so-called “unconventional” measures, including buying bonds in order to force longer-term interest rates down toward zero.
Seven of the 13 say what is needed most is fiscal stimulus (including extra government spending on infrastructure), three say both fiscal and monetary measures are needed, and three want government “structural reform”, including measures to help the economy deal with climate change and remove red tape.
None say the Reserve Bank should be left to fight the downturn by itself without further help from the government.
There is plenty of room for fiscal stimulus, particularly infrastructure spending – Mark Crosby, Monash University
I agree with the emerging consensus that monetary policy is no longer effective when interest rates are so low – Ross Guest, Griffith University
It is time for coordinated monetary and fiscal policies to boost domestic demand – Guay Lim, Melbourne Institute
The surplus can wait
Eleven of the 13 believe the government should abandon its determination to deliver a budget surplus in 2019-20.
Economic modeller Renee Fry-McKibbin says the government should “ease its position of a surplus at all costs”.
Former Commonwealth Treasury and ANZ economist Warren Hogan says achieving a surplus in the current environment would have “zero value”.
The approach would move worthwhile infrastructure spending and borrowing onto a separate balance sheet that would not need to balance.
Political debate would focus instead on whether the annual operating budget was balanced or in deficit.
Former treasury and IMF economist Tony Makin is one of only two economists surveyed who backs the government’s continued pursuit of a surplus, saying annual interest payments on government debt have reached A$14 billion, “four times the foreign aid budget and almost twice as much as federal spending on higher education”.
Further deterioration of the balance via “facile fiscal stimulus” would risk Australia’s creditworthiness.
However Makin doesn’t think the government should leave everything to the Reserve Bank.
He has put forward a program of extra spending on infrastructure projects that meet rigorous criteria, along with company tax cuts or investment allowances paid for by government spending cuts.
Former trade minister Craig Emerson also wants an investment allowance, suggesting businesses should be able to immediately deduct 20% of eligible spending.
It’s an idea put forward by Labor during the 2019 election campaign. Treasurer Josh Frydenberg has indicated something like it is being considered for the 2020 budget.
Emerson says it should be possible to deliver both the investment allowance and a budget surplus.
Quantitative easing would be a worry
Five of the 13 economists are concerned about the Reserve Bank adopting so-called “unconvential” measures such as buying government and private sector bonds in order to push long-term interest rates down toward zero, a practice known as quantitative easing.
Jeffrey Sheen and Renee Fry-McKibbin say it should be kept in reserve for emergencies.
Adrian Blundell-Wignall and Mark Crosby say it hasn’t worked in the countries that have tried it.
A quantitative easing avalanche policy by the European central bank larger than the entire UK economy has left inflation below target and growth fading. Quantitative easing destroys the interbank market, under-prices risk, and encourages leverage and asset speculation – Adrian Blundell-Wignall
Steve Keen says in both Europe and the United States quantitative easing enriched banks and drove up asset prices but did little to boost consumer spending, “because the rich don’t consume much of the wealth”.
The treasurer should step up
Taken together, the responses of the 13 economists suggest it is ultimately the government’s responsibility to ensure the economy doesn’t weaken any further, and that it would be especially unwise to palm it off on to the Reserve Bank at a time when the bank’s cash rate is close to zero and the effectiveness of the unconventional measures it might adopt is in doubt.
Measures the government could adopt include increasing the rate of the Newstart unemployment benefit, boosting funding for schools and skills training, borrowing for well-chosen infrastructure projects with a social rate of return greater than the cost of borrowing, further tax cuts that double as tax reform (including further tax breaks for business investment) and spending more on programs aimed at avoiding the worst of climate change and adapting to it.
The economists are backing the governor in his plea for help. They think he needs it.
Thatcherite populist rhetoric mobilised the people against big government and elite special interests, which was combined with authoritarian measures such as increased policing of ethnic minorities and militant unions.
Authoritarian populist is a term now sometimes applied to Donald Trump. So it is well worth asking whether the Morrison government also has some authoritarian populist tendencies.
This is particularly the case given Morrison’s recent embrace of a Trump-influenced anti-globalist rhetoric, which seems partly aimed at asserting Australian independence from international human rights frameworks.
The populist tinge to Morrison’s politics was obvious during the 2019 election campaign. Morrison countered Labor’s own populist arguments (standing against the “top end of town”) by using an alternative populism that mobilised the people against big-spending, big-taxing Labor governments. He argued that Labor would rip off ordinary citizens, run up big debts and ruin the economy, costing jobs in the process.
Morrison’s election persona of “ScoMo”, the warm and friendly daggy dad from the suburbs, might not seem authoritarian. However, even then, there were authoritarian tendencies creeping in to his populism. This is not just in his attitudes to asylum seekers, but also to Australians. For example, Morrison’s slogan: “A fair go for those who have a go” implied that some welfare recipients didn’t deserve the benefits they were getting.
Indeed, the Morrison government’s authoritarian policy agenda also has a punitive element that has become more evident since the election. Not only has the government emphasised it won’t increase Newstart (despite even business groups calling for an increase), but welfare recipients have been increasingly demonised.
The social services minister reportedly rejected increasing Newstart on the grounds that many welfare recipients would just spend the money on drugs and alcohol. The government has instead revived punitive mandatory drug-testing proposals for welfare recipients.
Meanwhile, Peter Dutton has suggested climate change protesters should face mandatory imprisonment and lose their unemployment benefits.
Morrison has dismissed calls for greater media freedom with the populist argument that journalists should not be “above the law”. (In doing so, he implies journalists are an elitist group demanding special privileges denied to ordinary people.)
Yet it is governments that make the law, including authoritarian and punitive laws that can shield them from proper democratic scrutiny. Suggesting that the attorney-general should have the final say on whether police proceed with prosecutions against journalists compounds, rather than reduces, the problem.
It is not just powerful media organisations facing the government’s authoritarian streak. Attacking higher energy prices is a popular move (and easier for the Liberals than developing a full energy policy, given internal divisions).
But businesses have expressed their concern at the “big stick” potentially being wielded against them. Predictably, though, it is unions that face the government’s most authoritarian measures, with the ACTU arguing the proposed new laws are designed to bust them.
Admittedly, as I have argued elsewhere, none of these authoritarian tendencies are totally new. The Howard government had a history of tough legislation against unions and of defunding advocacy groups.
Australian governments have introduced increasingly authoritarian measures that the United Nations and human rights organisations have criticised previously for undermining Australian democracy, including under Turnbull’s watch.
Many moderate Liberals who remembered Turnbull from his libertarian spycatcher days, opposing British government secrecy, were sadly disappointed by his failure to stand up to the right-wingers in his party on such issues. (Admittedly, Labor often capitulated on so-called national security issues as well.)
Nor is it unusual for conservatives in the party to demonise protesters. Indeed, a NSW Liberal premier once reportedly urged a driver to run them over.
However, the attitudes towards Newstart, for example, are very different from the days when Robert Menzies was proud of increasing unemployment benefits. The authoritarian industrial relations measures are also a far cry from the social liberal traditions that used to influence the Liberal Party. The eroding of civil liberties will be concerning to many small-“l” Liberal voters, as well as to more left-wing voters.
Some Turnbull supporters would have felt relieved when he was replaced by Morrison rather than the Coalition’s hard man, Dutton.
However, perhaps “ScoMo” is just a more personable Dutton in some respects. Whether his government’s punitive measures will eventually undermine Morrison’s warm and friendly election image remains to be seen.
Since before the 2019 election, the Morrison government has been keen to introduce a new scheme that would allow government agencies, telecos and banks to use facial recognition technology to collect and share images of people across the country.
While there are some benefits to such a system – making it easier to identify the victims of natural disasters, for example – it has been heavily criticised by human rights groups as an attempt to introduce mass surveillance to Australia and an egregious breach of individual privacy.
The plan hit a roadblock when the government-controlled Parliamentary Joint Committee on Intelligence and Security (PJCIS) handed down an extensive report calling for significant changes to the legislation to ensure stronger privacy protections and other safeguards against misuse.
The identity-matching bills aim to set up a national database of images captured through facial recognition technology and other pieces of information used to identify people, such as driver’s licenses, passports, visa photos. This information could then be shared between government agencies, and in some cases, private organisations like telcos and banks, provided certain legal criteria are met.
The proposed database follows an agreement reached by the Commonwealth and the states and territories in 2017 to facilitate the “secure, automated and accountable” exchange of identity information to help combat identity crime and promote community safety.
Critical to this agreement was that the system include “robust privacy safeguards” to guard against misuse.
The agreement gave the federal government the green light to introduce laws to set up the identity-matching system.
Access to the service could potentially encompass a wide range of purposes. For example, a government agency could use the system to identify people thought to be involved in identity fraud or considered threats to national security.
But the bill also includes more pedestrian uses, such as in cases of “community safety” or “road safety”.
The proposed laws contain some safeguards against misuse, including criminal sanctions when an “entrusted person” discloses information for an unauthorised purpose. In addition, access by banks or other companies and local councils can only occur with the consent of the person seeking to have their identity verified.
However, much of the detail about precisely who can access the system and what limits apply is not set out in the bills. This will be determined through government regulation or subsequent intergovernmental agreements.
Concerns about scope and safeguards
The Coalition government’s bills were first introduced in 2018, but didn’t come up for a vote. After the government reintroduced the bills in July, the PJCIS launched an inquiry and invited public submissions.
Legal bodies have argued that amendments are needed to tighten the boundaries of who can access the identity-matching services and for what purposes. They note that as currently drafted, the proposed laws give too much discretionary power to government officials and actually create opportunities for identity theft.
This is particularly problematic when coupled with the potential for the rapid spread of facial recognition technology in Australian streets, parks and transport hubs.
The Human Rights Law Centre said the proposed system is “more draconian” than the one launched in the UK. Another concern is that it could be used by a wide range of agencies to confirm the identity of any Australian with government-approved documentation (such as a passport or driver’s license), regardless of whether they are suspected of a crime.
The Australian Human Rights Commission also pointed to research suggesting the software used to capture or match facial imagery could result in higher error rates for women and people from certain ethnic groups.
What’s next for the bills?
When handing down the committee’s unanimous report, Andrew Hastie said the broad objectives of the identity-matching system were sound, but key changes were needed to ensure privacy protections and transparency.
The states and territories also have an interest in ensuring a national identity-matching scheme gets the balance right when it comes to addressing identity crime and assisting law enforcement and protecting individual privacy.
The question is whether these calls for improvements will be loud enough to put these bills back on the drawing board.
The future of the legislation will tell us something important about the strength of human rights protections in Australia, which rely heavily on parliamentary bodies like the PJCIS to help raise the alarm when it comes to rights-infringing laws.
Tasmanian Senator Jacqui Lambie has some sobering reading to do over the coming weeks: an 88-page Senate report into the government-sponsored bill to repeal the medevac law that allow refugees and asylum seekers in Papua New Guinea and Nauru to seek medical care in Australia. The publication of the report last Friday paves the way for a Senate vote on the bill in mid-November.
As predicted, the Senate committee that issued the report split along party lines, with the Coalition majority calling for the medevac provisions to be repealed and the ALP, Greens and Centre Alliance senators releasing dissenting reports.
What is less predictable is how the report will influence Lambie’s deciding vote. She has indicated she will approach the bill as a conscience vote, saying
Tasmanians don’t want deals done over humanity.
An overwhelming health crisis in offshore detention
The medevac law allows a person to be transferred to Australia for medical treatment or assessment if two Australian-registered doctors recommend such care is necessary and unavailable in PNG or Nauru. There are limited exceptions for the minister of home affairs to reject a transfer on security and character grounds.
The Coalition government maintains the pre-medevac medical transfer policy for refugees was adequate. This allowed transfers only in life-threatening cases in which the required specialist medical care could not be provided on PNG, Nauru or a third country like Taiwan.
However, evidence given to the Senate committee showed a drastic drop in medical transfers to Australia from 2015 to mid-2018, despite clear medical need.
Statistics given to the committee by the National Justice Project, a not-for-profit legal service that acts on behalf of refugees, documented how some patients had to wait more than four years for medical transfers to Australia.
Tony Bartone, the Australian Medical Association president, described the government’s pre-Medevac process as “torturous” and involving “long periods of delay,” without any appropriate oversight.
Court injunctions and prospective litigation from mid-2018 onwards did compel the government to bring around 350 people to Australia for urgent medical treatment or as an accompanying family member. But such court interventions can be costly, slow and resource-intensive for those in need of immediate medical attention.
And that need is still extremely high for those refugees remaining in offshore detention. An independent health assessment in June found a staggering 97% of those in detention and processing facilities have been diagnosed with physical health conditions. A further 91% were experiencing mental health problems, including severe depression and PTSD.
All but two of the 95 public submissions received by the committee were strongly in favour of retaining the medevac law.
Tellingly, those two submissions were from the Department of Home Affairs and the International Health and Medical Service, a government-contracted health provider on Nauru.
Overlooked refugee suffering in Australia
What is missing from the Senate report is any mention of the intolerable situation that refugees and asylum seekers face even after they have been transferred to Australia.
Although people can access critical medical treatment here, most remain in community detention, facing economic insecurity and legal uncertainty about their future. Research shows such legal limbo can lead to feelings of despair and dehumanisation.
The day before the report’s release, 32-year-old Afghan doctor Sayed Mirwais Rohani died in Brisbane, the victim of an apparent suicide. Rohani had come to Australia for medical treatment two years ago, after spending four years in immigration detention on Manus Island.
After his death, his former roommate posted on Facebook:
We shared same pain for long time, long enough to destroy someone’s life.
Instead, Lambie indicated she would look to “national security” considerations in weighing up the report’s findings, including the dissenting reports. She has in the past called for children not to be in immigration detention and voted against the Coalition government’s bill to introduce temporary refugee visas in 2014.
Even if the medevac provisions stay in place, the status quo of Australia’s offshore detention regime remains unsustainable and inhumane.
As former MP Kerryn Phelps, a key architect of the medevac law during her brief time in parliament, stated in her evidence to the Senate committee, refugees and asylum seekers are
not trying to make a point; they’re trying to kill themselves because they’ve lost hope.
The federal government’s much-vaunted Snowy Hydro expansion is supposed to smooth out the bumps in electricity supply as Australia transitions to renewables. But not only is the project a bad deal for taxpayers, our analysis suggests it will deliver a fraction of the energy benefits promised.
Fossil-fuel power generators store coal or gas at the point of production. This means electricity can mostly be created on demand when homes and businesses need it. Renewable energy cannot do this. If wind or sun is not abundant, solar panels and wind turbines may not produce enough electricity to meet demand. At other times they might produce more than required.
The Snowy 2.0 project is supposed to provide a solution to this problem – storing renewable energy for when it is needed.
The project’s cost and time estimates have blown out massively. It would now be surprising if Snowy 2.0, including the transmission upgrades it relies on, comes in at less than A$10 billion or is finished before 2027.
But there is another serious problem. Our analysis has revealed that of the extra pumped hydro capacity promised by the project, less than half can be delivered. There is now overwhelming evidence the project should be put on hold.
The problems we know about: cost and time blowouts
The list of possible alternatives to Snowy 2.0 is long. Aside from other pumped hydro projects, it includes chemical batteries, encouraging demand to follow supply, gas or diesel generators, and re-orienting renewable generators to capture the wind or sun when it is less plentiful.
But despite this plethora of options, the federal government announced the Snowy 2.0 project without a market assessment, cost-benefit analysis or indeed even a feasibility study.
When former Prime Minister Malcolm Turnbull announced the expansion project in March 2017 he said it would cost A$2 billion and be commissioned by 2021. This was revised upwards several times and in April this year, a A$5.1 billion contract for partial construction was awarded. This excludes the costs of transmission and other considerable expenses.
The main contractor says the project will take eight years to build – bringing us to 2027 before the full scheme is completed. We will happily wager that more delays and cost increases will be announced.
Snowy Hydro has not costed the transmission upgrades upon which the project depends. TransGrid, owner of the grid in New South Wales, has identified options including extensions to Sydney with indicative costs up to A$1.9 billion. Massive extensions south to Melbourne will also be required.
Snowy Hydro contends it should not pay for the new transmission lines because the benefits would flow to the entire grid, not just its venture. In other words Snowy Hydro argues, conveniently, that we should count the benefits but ignore the costs when thinking about their project.
The numbers simply do not add up
The Snowy 2.0 project grandly claims it could generate at its full 2,000 megawatt capacity for 175 hours – or about a week. This capacity can also be expressed as 350 gigawatt hours (GWh).
Energy Minister Angus Taylor has talked up the project’s superiority to smaller-capacity alternatives such as batteries.
But the maximum additional pumped hydro capacity Snowy 2.0 can create, in theory, is less than half this. The reasons are technical, but worth taking the time to understand.
The figure below outlines the main physical features that define Snowy 2.0. It includes four dams: Tantangara, Talbingo, Jounama and Blowering. For simplicity, we have numbered these from 1-4 in the following explanation.
When Snowy 2.0 generates electricity, water will be released from Dam 1 at the top of the system. It will flow through a long tunnel to the smaller Dam 2. The flow of water drives turbines which generate energy. When the turbines are reversed, the water is pumped back to the top to continue the cycle.
For Snowy 2.0 to produce the 350 GWh of electricity claimed, the top dam must be full and all that water released through the system. But replenishing the top dam after this event would take many months of pumping water from elsewhere in the system, and use up 40% more electricity than was originally generated. So the 350 GWh would never be achieved because it is extremely inefficient and inflexible.
In reality, the pumped hydro capacity of Snowy 2.0 is defined by the amount of water that the smaller Dam 2 can hold. If the scheme was a closed system, with no other water flowing in or out, it could produce around 230 gigawatt hours (GWh) of electricity.
But the system does not exist in isolation. Part of the existing Snowy Hydro scheme, known as Tumut 3, also uses Dam 2. It creates pumped hydro electricity by cycling water between that dam and the even smaller Dam 3 below it.
For Snowy 2.0 to operate at full cyclical capacity, Dam 2 must be empty to receive the water. That would entail emptying Dam 2 into the smaller Dam 3 and from there to Dam 4 at the bottom of the system. This water could not be used again to generate electricity. This “lost” water would have generated 60 GWh worth of electricity in the Tumut 3 scheme.
This means that as a cyclical pumped hydro system, Snowy 2.0 does not add 230 GWh of capacity. When you subtract the 60 GWh from the 230 GWh, Snowy 2.0 adds just 170 GWh of recyclable pumped hydro. This is less than half the claimed storage capacity.
And this is the maximum cyclical capacity in theory only. Snowy 2.0 would never produce continuously for the time needed to generate and then pump 230 GWh because it would never be economically viable to run it this way.
In practice if Snowy 2.0’s lower dam is operated in future as it is now – almost always close to full – the cycling capacity of Snowy 2.0 may be as low as 40 GWh – around one tenth of the promised number.
What does all this mean?
These facts put Snowy 2.0 in a completely different light. There are many competing alternatives that can provide storage far more flexibly for a fraction of Snowy 2.0’s price tag. These alternatives would also have far fewer environmental impacts or development risks, in most cases none of the transmission costs and could be built much more quickly.
It is always difficult to press the pause button on a major project once it has begun. But the evidence for doing this is overwhelming. In pursuit of the public interest, the federal government should put the project on hold and ask a reputable investment bank to publicly advise, perhaps through the Productivity Commission, what Snowy 2.0 would be worth if built.
A credible independent valuation would establish with some confidence how deeply Snowy Hydro will have its hands in the public’s pockets. A panel of independent experts should then be asked to publicly advise whether taxpayer money is needed to meet the demands of a renewables-dominated power system, and if so, the best way it should be spent.
Sometimes birthdays are best let pass quietly. The Liberals are finding the 75th anniversary of their founding another occasion for the blood sport they thought they’d put behind them.
Tony Abbott and Malcolm Turnbull are out of parliament – for which Scott Morrison is much thankful – but their passions are unabated. Each has let fly in interviews with The Australian’s Troy Bramston to mark the anniversary.
Abbott repeated that it was Turnbull’s undermining which did him in (only the partial truth) and indicated he wouldn’t mind returning to parliament but didn’t think the Liberal party would ask him (absolutely true).
Turnbull’s was the more pertinent and, from where the government stands, pointed interview because it fed very directly into central issues of the moment, climate change and energy policy.
“The Liberal Party has just proved itself incapable of dealing with the reduction of greenhouse gas emissions in any sort of systematic way,” Turnbull said.
“The consequence … is without question that we are paying higher prices for electricity and having higher emissions.”
He knows what he’s talking about. These issues were critical (though not the only factor) in Turnbull losing the leadership twice – first in opposition and then in government. And that was despite doing deals and trade offs to try to satisfy the right in his party.
He still frets about the battles which cost him so much for so little gain. He told the Australian, amid boasts about what his government had done, that his biggest regret as PM was not settling a new energy policy.
What Scott Morrison really thinks on the climate challenge, or what he would do if he were just driven by policy concerns without regard to party considerations or electoral judgements are in that category of known unknowns.
In few areas can Morrison’s beliefs be divined free of political context.
But we do know two things.
Firstly, we don’t have a satisfactory energy policy: emissions are rising; power prices are too high; investment is being discouraged. An analysis released by the Grattan Institute this week was damning about how federal government policies were discouraging investment including by “bashing big companies” (the so-called “big stick” legislation, allowing for divestment when an energy company is recalcitrant, is still before parliament).
Secondly, climate change is again resonating strongly in the community.
Critics dismiss the attention young activist Greta Thunberg has received internationally, and this week’s “Extinction Rebellion” demonstrations, and many in the government would point to the election result to note that climate change did not carry the day with the “quiet Australians”.
The Morrison win, however, doesn’t mean the issue lacks cut through, or won’t have potency in the future. And although the Liberals like to talk about the miracle victory, it should be remembered the win was by a sliver, not by 30 seats. What made it so notable was that it defied expectations.
Turnbull said in his interview the Liberal party had been influenced by a group that was denialist and reactionary on climate change.
It still is, but this group is not giving trouble at the moment because Morrison, unlike his predecessor, is not provoking them.
The problem for Morrison is that keeping his party calm doesn’t solve the policy problem. Unless that is more effectively tackled, it could come back to bite him, regardless of the positive tale he tries to spin, such as in his United Nations speech.
Turnbull also said in his interview that, among much else, in government he had been “very focused on innovation” which, as we remember, was his catch cry in his early days as PM.
Australia fell from 57th to 93rd between 1995 and 2017 on the index of economic complexity, which measures the diversity and sophistication of countries’ exports. Our wealth comes from the minerals and energy that form the bulk of our exports but “Australia is less complex than expected for its income level. As a result, its economy is projected to grow slowly. The Growth Lab’s 2027 Growth Projections foresee growth in Australia of 2.2% annually over the coming decade, ranking in the bottom half of countries globally,” the data says.
“Economic growth is driven by diversification into new products that are incrementally more complex. … Australia has diversified into too few products to contribute to substantial income growth.”
Turnbull’s talk of innovation, agility, and the like was seen by many in his ranks, particularly in hindsight, as too high falutin’. It certainly went down badly in regional areas, which is why in 2016 the Nationals sharply differentiated themselves in the election campaign.
The Harvard work suggests Turnbull’s innovation ambition was on the right track. But the political evidence showed he was a bad salesman for this (and a lot else).
Morrison is a good marketing man. But the test of his prime ministership will be whether he can use his marketing skills to sell policies that the country needs, rather just what he thinks will go over easily with his constituency.
The most effective leaders (and that excludes both Abbott and Turnbull) can both identify what the nation requires and persuade enough of the voters to embrace it, even when it’s difficult. They operate not on the principle of the lowest common electoral denominator, or simplistic descriptions of their supporters – rather they pursue the highest achievable goals.
Marles accused the government of mismanaging a “complex” relationship. After visiting Beijing last week for conversations with a range of Chinese opinion-leaders, he described relations as “terrible”.
Prime Minister Scott Morrison, he said, had engaged in megaphone diplomacy on his visit to the United States, insisting China be regarded as a “developed” country for trade and other purposes. This includes its climate change obligations.
What we saw was the prime minister in the United States in the context of there being trade tensions between the US and China, and from there, taking pot shots against largest trading partner. The context in which he has engaged in this megaphone diplomacy is absolutely the issue, and it’s not the way in which this issue should be dealt with in a respectful way.
These observations might be taken with a pinch of salt from an opposition spokesman. But it is true that relations are now at a low ebb for a variety of reasons, some of the government’s making, some not.
Australia did not initiate a trade war, but fractious relations with China are collateral damage.
Significantly, what is emerging in Australian domestic politics is an erosion of what has been a bipartisan consensus on how to relate to China in what are very challenging circumstances.
This is, potentially, a watershed moment in the evolution of the Australian policy towards China. This policy has, more or less, been settled business since Gough Whitlam normalised relations in 1972 as one of his first acts as prime minister.
Morrison’s embrace of American calls for China to be declared a developed country under World Trade Organisation rules means there is now a sharp point of difference between the government and opposition.
China’s economic growth is welcomed by Australia and we recognise the economic maturity that it has now realised as a newly developed economy… The world’s global institutions must adjust their settings for China in recognition of this new status. That means more will be expected, of course, as has always been the case for nations like the United States who’ve always had this standing.
Labor does not regard China as a “developed” country under World Trade Organisation auspices, nor, for that matter, does most of the rest of the world. This is an American preoccupation, now signed onto by Canberra.
Why it should have been necessary for Morrison to take sides in this debate is not clear. On the face of it, his interventions have been unwise.
What should be understood about emerging differences over China’s “developed” country status, is that it represents, in an Australian context, a wider divergence of views between the government and opposition on how to manage China’s rise.
The government believes China should be pulled into line. Labor is more circumspect while acknowledging that Beijing’s behaviour is exerting considerable – and unwelcome – stress on an international rules-based order.
Whether he pretends otherwise or not, Morrison has aligned Australia with the Donald Trump White House view of China as a mercantilist power seeking ruthlessly to extend its power and influence in the Indo-Pacific and beyond.
In its mirroring of the US position, the government is indicating it believes China needs to have its wings clipped.
Morrison’s visit to the United States may come to be regarded, therefore, as a watershed moment in Australian foreign policy in which a choice was made.
Enter the Labor Party into this debate in a way that represents its boldest intervention in a foreign policy question since then Labor leader Simon Crean detached his party in 2003 from supporting the ill-fated rush to war in Iraq.
The difference between then and now is that getting policy settings right in the great US versus China debate is far more important to Australia’s well-being than an ill-conceived decision two decades ago that turned the Middle East upside down and empowered Iran.
The view promulgated by former Prime Minister John Howard that Australia did not need to choose between its historical alignment with America and its geographical proximity to China is no longer sustainable.
The question now is how Australia positions itself between the elephants in the jungle to avoid getting crushed. Conspicuously siding with one of the elephants, unless necessary, would not seem to be the wisest course.
In all of this, one might spare a thought for Trade Minister Simon Birmingham, whose role has been to try to ensure Australia’s trade in merchandise and services is not harmed by a trade war between China and the United States.
Birmingham has been doing his best. He has not been helped by his leader’s injudicious remarks to The Chicago Council on Global Affairs.
Australia will commit a frigate, an aircraft and some headquarters staff to an American-led freedom of navigation operation in the Middle East.
Scott Morrison, announcing the long-expected commitment at a Canberra news conference on Wednesday, stressed this was an international mission, but so far the United Kingdom is the only other country to have signed up.
Under questioning, the Chief of the Australian Defence Force, General Angus Campbell, said the operation would be United States-led. But Campbell avoided spelling out in detail the rules of engagement in the event of being involved in an incident, other than referring to legal obligations.
Iran has seized ships in recent months, amid escalating tensions.
This week, an Iranian oil tanker was released after being detained by the British overseas territory of Gibraltar on suspicion of taking oil to Syria. The US tried unsuccessfully to have Gibraltar extend the vessel’s detention.
Morrison said Australia had made very clear both to the US and the UK “that we are here as part of a multinational effort”.
“This is a modest, meaningful and time-limited contribution …to this international effort to ensure we maintain free-flow of commerce and of navigation,” he said.
“Australia will defend our interests, wherever they may be under threat, we will always work closely with our international allies and partners.”
Morrison emphasised that the safety of shipping lanes was vital to Australia’s economic interests.
The government had been concerned over incidents in the Strait of Hormuz, he said. “30% of refined oil destined for Australia travels through the Strait. It is a threat to our economy.”
The Australian contribution will be
a P-8A Poseidon maritime surveillance aircraft for one month before the end of 2019;
an Australian frigate in January 2020 for six months; and
ADF personnel to the International Maritime Security Construct headquarters in Bahrain.
One complication for Australia in finalising the commitment was the fact there was no Australian frigate in the area, with the next deployment not due until January.
Australian ships participate in counter-piracy and counter-terrorism operations in the Middle East.
The Americans were very pressing in their request to Australia to join the force, including in public statements during the recent AUSMIN talks.
Morrison has emphasised Australia wants to see the de-escalation of tensions in the area and separates its commitment to the freedom of navigation operation from America’s other activities in relation to Iran.
Treasurer Josh Frydenberg has issued a timetable for the government’s dealing with the recommendations from the royal commission into banking, superannuation and financial services, which aims to have all measures needing legislation introduced by the end of next year.
The opposition has accused the government of dragging its feet on putting into effect the results of the inquiry, which delivered its final report early this year.
“The need for change is undeniable, and the community expects that the government response to the royal commission will be implemented swiftly,” Frydenberg said in a statement on the timetable.
Fydenberg said that in his final report Commissioner Kenneth Hayne made 76 recommendations – 54 directed to the federal government (more than 40 of them needing legislation), 12 to the regulators, and 10 to the industry. Beyond the 76 recommendations, the government had announced another 18 commitments to address issues in the report.
The government had implemented 15 of the commitments it outlined in responding to the report, Frydenberg said. This included eight out of the 54 recommendations, and seven of the 18 additional commitments the government made. “Significant progress” had been made on another five recommendations, with draft legislation in parliament or out for comment or consultation papers produced.
The government at first accepted most of this recommendation, announcing the payment of ongoing so-called “trailing commissions” would be banned on new loans from July 2020. Upfront commissions would be the subject to a separate review. Four weeks later in March Frydenberg announced the government wouldn’t be banning trailing commissions after all. Instead, it would review their operation in three years.
Releasing the timetable, Frydenberg said the reform program was the “biggest shake up of the financial sector in three decades” and the speed of implementation “is unprecedented”.
“It will be done in a way that enhances consumer outcomes with more accountability, transparency and protections without compromising the flow of credit and competition,” he said.
He undertook to ensure the opposition was briefed on each piece of legislation before it came into parliament.
“This will begin with the offer of a briefing by Treasury on the implementation plan. Given both the government and opposition agreed to act on the commission’s recommendations, we expect to achieve passage of relevant legislation without undue delays,” he said.
He said the industry was “on notice. The public’s tolerance has been exhausted. They expect and we will ensure that the reforms are delivered and the behaviour of those in the sector reflects community expectations.”