Vital Signs: does monetary policy work any more?


Richard Holden, UNSW

In its quarterly statement on monetary policy, released today, the Reserve Bank of Australia declared its preparedness to “ease monetary policy further if needed”.

This suggests the bank still thinks monetary policy – in this case lowering interest rates to stimulate the economy – could help “support sustainable growth in the economy, full employment and the achievement of the medium-term inflation target”.

But in the wake of the bank last month lowering the official interest rate to a record low and the current somewhat sad state of the Australian economy, many commentators have speculated that monetary policy doesn’t work any more.




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We asked 13 economists how to fix things. All back the RBA governor over the treasurer


Is that right?

There are a number of variants of the “monetary policy doesn’t work” argument. The most basic is that the Reserve Bank has this year cut rates from 1.50% to 0.75% without any improvement to the Australian economy.

This is a textbook example of one of the classic logic fallacies known as “post hoc ergo propter hoc” (from the Latin, meaning “after this, therefore because of this”). Put simply, it assumes the rate cuts have had no effect and doesn’t account for the possibility things might have been worse had there been no cuts.

Things might have been even worse. We’ll never know.

It also ignores what might have happened if the RBA had cut sooner. Again, we can’t know for sure. It is possible, though, to make an educated guess.

When to cut rates

Had the Reserve Bank acted, say, 18 months earlier to cut rates, it would have signalled that Gross Domestic Product (GDP) growth was indeed lower than desired, the sustainable rate of unemployment was more like 4.5% than 5%, and most importantly that it understood the need to act decisively.

That would have sent a powerful signal.

It would also have ameliorated the huge decline in housing credit that pushed down housing prices in Sydney and Melbourne by double digits. That, in turn, would have prevented some of the weakening in the balance sheets of the big four banks that has occurred (witness this annual general meeting season).

All of this would have pumped more liquidity into the economy and put households in a much stronger position, likely leading to stronger consumer spending than we have seen.

Bank pass through

One gripe both the Reserve Bank governor Philip Lowe and federal treasurer Josh Frydenberg have had with the banks is their failure to fully pass through the RBA cuts.




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Our leaders ought to know better: failing to pass on the full rate cut needn’t mean banks are profiteering


It is true there is a problem with banks not being able to cut deposit rates below zero, and as a result having less scope to cut mortgage rates, which are majority funded from deposits.

But there are, of course, other ways monetary policy can work. The leading example is quantitative easing (QE). This is where the central bank pushes down long-term interest rates by buying bonds. At the same time this expands the money supply, thereby adding some upward inflationary pressure.

There is little reason to believe such measures won’t work.

The power of free money

Perhaps paradoxically, the closer interest rates get to zero the more powerful those rates may end up being.

To put it bluntly, if someone shoves a pile of money into your hand and asks almost nothing in return, you’re likely to use it. In fact, you would be pretty silly not to.

Suppose your mortgage rate really goes to zero – as has happened in Europe.

You might decide to redraw that and spend the money on a home renovation or some other productive purpose. Or you might decide to buy a more expensive house.

Such spending provides an economic boost. The effect is all the more pronounced if people expect interest rates to be low for a long period of time. Aggressive cutting coupled with quantitative easing – which lowers long-term rates – signal just that.

But not only monetary policy

Just because monetary policy still has some effect at near-zero rates doesn’t mean we should pin all of our economic hopes to it.

A near consensus of economists have argued repeatedly for the use of more aggressive fiscal policy – including more infrastructure spending and more tax cuts.




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We asked 13 economists how to fix things. All back the RBA governor over the treasurer


Indeed, Philip Lowe has raised eyebrows by speaking so forthrightly on this issue. That doesn’t make him wrong, though.

There is little doubt the Reserve Bank should have acted much earlier to cut official interest rates. There is also a very good chance it will need to begin to use other measures such as quantitative easing in the relatively near future.

All of that says the Australian economy, like most advanced economies around the world, is in bad shape.

But it doesn’t mean monetary policy has completely run out of puff.The Conversation

Richard Holden, Professor of Economics, UNSW

This article is republished from The Conversation under a Creative Commons license. Read the original article.

We asked 13 economists how to fix things. All back the RBA governor over the treasurer


Peter Martin, Crawford School of Public Policy, Australian National University

Thirteen leading economists have declared their hands in the stand off between the government and the Governor of the Reserve Bank over the best way to boost the economy.

All 13 back Reserve Bank Governor Philip Lowe.

They say that, by itself, the Reserve Bank cannot be expected to do everything extra that will be needed to boost the economy.

All think that extra stimulus will be needed, and all think it’ll have to come from Treasurer Josh Frydenberg, as well as the bank.

All but two say the treasurer should be prepared to sacrifice his goal of an immediate budget surplus in order to provide it.

The 13 are members of the 20-person economic forecasting panel assembled by The Conversation at the start of this year.

All but one have been surprised by the extent of the economic slowdown.




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The 13 represent ten universities in five states.

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.

Absent a crisis, economic weakness was “best responded to by monetary policy”.

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.




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If you want to boost the economy, big infrastructure projects won’t cut it: new Treasury boss


Governor Lowe has made the case for “fiscal support, including through spending on infrastructure” saying there are limits to what monetary policy can achieve.

The 13 economists unanimously back the Governor.

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.

Renee Fry-McKibbin. Ease surplus at all costs.
ANU

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”.

Former OECD director Adrian Blundell-Wignall says that rather than aiming for an overall budget surplus, the government should aim instead for an “net operating balance”, a proposal that was put forward by Scott Morrison as treasurer in 2017.

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”.

Tony Makin. Surplus needed for budget repair.
Griffith University

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.


The 13 economists surveyed




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The Conversation


Peter Martin, Visiting Fellow, Crawford School of Public Policy, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

A national drought policy should be an easy, bipartisan fix. So why has it taken so long to enact a new one?



The Coalition has been promoting its $7 billion drought relief package, but critics say what’s needed is a more effective national drought policy.
Dan Peled/AAP

Linda Botterill, University of Canberra

In a country as dry as Australia, surely it is a no-brainer that we have in place a coordinated, national drought response that can be rolled out the same way that the Natural Disaster Relief and Recovery Arrangements are triggered when the country experiences cyclones, floods or bushfires.

Drought used to be part of these arrangements but, for good policy reasons, was removed in 1989.

Our last attempt at national drought policy

Once upon a time, Australia had a national drought policy. It was enacted in 1992 following a comprehensive review and report by an independent panel, the National Drought Policy Review Task Force, and detailed negotiations between Commonwealth and state ministers and their officials.

The policy included commitments by both state and Commonwealth governments to implement a coordinated and comprehensive package of programs covering drought preparation and response.

At the Commonwealth level, these measures were centred around:

  • the controversial “exceptional circumstances” provisions of its revised Rural Adjustment Scheme, which were aimed at supporting farm businesses by subsidising up to 100% of the interest paid on commercial loans.

  • a farm household support scheme that provided short-term income support to farmers and also offered grants for those who decided to leave the land.

  • farm management bonds, later known as farm management deposits, that allowed farmers to set aside pre-tax income they could later draw on in times of need.

  • a drought relief payment (added to the policy in 1994) that provided income support for farmers in areas declared to be experiencing “exceptional circumstances” drought. By May 1995, over 10,000 families were accessing this payment every month.

Grain feed left for sheep grazing on a failed crop in NSW.
NSW drought stock/AAP

Flaws in the policy

As anyone familiar with these programs will know, the exceptional circumstances program was plagued by problems.

The first was the lack of clarity around defining when a drought moved from a “normal” situation that was expected to be managed by farmers, to an “exceptional” situation with which even the best manager could not be expected to cope.

The definition of an “exceptional circumstances” drought became the subject of ongoing debate, along with concerns that drought assistance was based on administrative boundaries, leading to inequities that became known as the “lines on maps” problem.




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Just because both sides support drought relief, doesn’t mean it’s right


The second issue was the amount of information farmers were required to provide in order to demonstrate eligibility for “exceptional circumstances” assistance. The process was considered onerous and time-consuming.

Amid these concerns, a comprehensive review of drought policy was conducted in 2008 by the Productivity Commission. This was accompanied by a report by the Bureau of Meteorology and CSIRO on the likely impact of climate change on the frequency and severity of droughts in Australia, and an independent report on the social impact of drought.

Following the review, the government decided to end the “exceptional circumstances” program in 2009. This effectively gutted the national drought policy.

Since then, there has been no further attempt at developing a comprehensive, predictable drought policy response from the federal or state governments. There have been intergovernmental National Drought Agreements, but these have done little more than restate the principles underpinning the country’s drought policy since 1992.

In recent years, the Coalition government has appointed a drought envoy, Barnaby Joyce, and drought coordinator-general, Stephen Day, to study the impact of drought on farmers and recommend possible solutions, but we have yet to see what either has come up with.

Drought envoy Barnaby Joyce says he has sent drought reports directly to Scott Morrison, but these have not yet been made public.
Lukas Coch/AAP

Providing meaningful, timely and predictable support

Much of the criticism levelled at the government’s response to the current drought relates to its ad hoc and knee-jerk nature. This reactive way of dealing with drought highlights the need to return to a more predictable approach. This would avoid perceptions of pork barrelling and provide certainty to farmers about what support is available and under what circumstances.

A new national drought policy needs to take several forms. First, it needs to support farmers to prepare for drought before it happens. This is one area where the current policy has been moderately successful.

As of August 2019, Australian farmers had set aside a total of $5.809 billion in farm management deposits. These deposits have encouraged farmers to manage financial risk by building up cash reserves in high-income years, which they could then use during times of drought.

Individual farmers can currently hold a total of $800,000 in deposits. One possible improvement is to raise the ceiling on annual deposits in the years following drought recovery to allow a rapid rebuilding of cash reserves.

Second, a strong drought policy needs to provide support to all farmers during drought, not just those who have accumulated sufficient deposits to help them ride out the lean years.

In recent years, many farmers have taken advantage of long-term, low-interest loans to help during drought, and some have called for zero-interest loans to be made available, as well. But loans are not an ideal solution, as repayments are generally required even when farm incomes remain low.

An alternative to low- or no-interest loans are income contingent loans. Similar to the HECS-HELP scheme in higher education, these types of loans only require repayment when the borrower can afford to do so.

This would not only give farmers greater flexibility when it comes to repayment, it would also greatly reduce the extensive red tape that strangled the old “exceptional circumstances” scheme.




Read more:
Farm poverty: an area of policy aid built on sands of ignorance


Third, we need a serious rethink of the way we provide income assistance to farmers in a broader sense. Providing income support to farmers who are asset-rich, for instance, raises questions about fairness when compared with poor people in cities who are struggling to get by on Newstart payments.

This imbalance has come into stark focus in recent weeks, particularly on social media, as government ministers have discussed the introduction of drug testing for Newstart recipients, and in the debate around the Indue card.

There has been no serious attempt in the past 45 years to measure the extent of poverty among farmers. We can develop more appropriate and equitable income-support policies if we can better understand the genuine nature of their need.

The elephant in the room

While the government has assiduously avoided making the link, an effective national drought policy also cannot be divorced from discussions about climate change.

The 2008 Productivity Commission report was pretty clear in its conclusions about the impact of climate change on drought in Australia. A growing number of farmers are now acknowledging this reality. Denying the need for serious consideration of climate change is not doing our agricultural producers any favours.




Read more:
Is Australia’s current drought caused by climate change? It’s complicated


Developing an effective national drought policy is hard work. But in another sense, it should also be easy. This is because, unlike many other areas of government policy, it can be bipartisan.

Although the National Party has historically been aligned with rural voters, all parties are broadly sympathetic to farmers and value their contributions to the economy and, importantly, our national identity. The public also generally regards farmers positively and is responsive to their plight when they are faced with hardship.

As such, this should be one area where our politicians can come together to develop a coherent national response — one that is known in advance, forward-looking, equitable with other income-assistance programs in the community, and provides meaningful support before, during and after drought.The Conversation

Linda Botterill, Professor in Australian Politics, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Morrison needs to take control of China policy – but leave room for dissent



The Morrison government is at risk of losing control of China policy at the most critical time in Australian history.
AAP/EPA/Thomas Peter/pool

Tony Walker, La Trobe University

The Morrison government is at risk of losing control of China policy. Push-back from within its own ranks is complicating its ability to manage relations with Beijing. China policy is being subjected to a buffeting from hawkish backbenchers who would like to see Canberra adopt a harder line.

Let’s dispose first of straw man arguments about whether Liberal backbencher Andrew Hastie was within his rights to warn of threats to national sovereignty by a rising China that is ruthlessly advancing its own interests.

Hastie has every right to raise alarms about China’s behaviour in his capacity as a member of parliament and chair of the joint parliamentary committee on intelligence and security. He was given opinion space in Nine newspapers to do so.




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View from The Hill: It’s not in the ‘national interest’ for the backbench to shut up about China


However, he was ill-advised to use a reference to Nazi Germany to advance his argument about a China threat. Hastie may not have likened China to the Third Reich explicitly, but by referencing France’s inability to withstand German aggression he was implicitly making the link.

This is what he said:

The West once believed that economic liberalisation would naturally lead to democratisation in China. This was our Maginot Line. It would keep us safe, just as the French believed their series of steel and concrete forts would guard them against the German advance in 1940. But their thinking failed catastrophically. The French failed to appreciate the evolution of mobile warfare. Like the French, Australia has failed to see how mobile our authoritarian neighbour has become.

Invoking Nazi Germany or the Holocaust to advance an argument is treacherous terrain at the best of times, unless the author is clamouring for attention.

One wonders how much notice Hastie’s commentary would have attracted if there had been no reference to the inadequacies of France’s Maginot Line.

It’s reasonable to speculate that his contribution would have gone the way of those written by other China hawks in the so-called national security establishment, many of whom have converted their hawkishness on China into a cottage industry.

One other point might be made about Hastie’s contribution. It is simply not correct to say, as he did, there was a general expectation China would continue to democratise and in time become more like us.

This is a flawed and naive point of view.

China’s ruthless suppression of the Tiananmen Square democracy protests in 1989 was not an aberration. It was consistent with its behaviour since it began opening to the outside world in the late 1970s.




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Its 1979 suppression of a Democracy Wall movement, and the arrest of prominent dissidents including human rights activist Wei Jingsheng, now in exile, attest to a regime’s ruthlessness in stifling dissent.

Beijing’s tolerance of Hong Kong’s pro-democracy protests will be viewed through a prism of what these might portend for the mainland. If there is any indication of contagion across borders, China will react forcefully, and may do so anyway if disturbances continue.

Before addressing what might be an appropriate response from the Australian government to an eruption of anti-China sentiment on its own backbench, perhaps it would be useful to define the challenges at play.

In its latest manifestation, China is no longer a status quo power. It is one that is seeking expand its power and influence in what it regards as its own sphere of influence in the Asia-Pacific, broadly defined to include the southwest Pacific.

These attempts to assert itself are not simply restricted to the militarisation of geographical features in the South China Sea. They also involve pursuit of an economic, diplomatic and propaganda offensive that is designed to advance Chinese interests at home and abroad.

In seeking to promote these interests, Beijing is an indefatigable exploiter of opportunities and weaknesses. If there is a rule of thumb in dealing with China in this latest phase, it is that it will seek to get away with what it can on many different fronts.

In that sense, Hastie has a point: Australia cannot simply adopt a passive response to Chinese single-mindedness in pursuit of what it perceives to be its own interests.

The question, then, becomes what to do?

This is where it becomes crucial that the Morrison government settles on a clearly defined strategy to deal with a disruptive China. What this should involve is a combination of a hedging strategy in partnership with Australia’s allies to balance Beijing’s militarised ambitions, and a separate one in which Australia’s own economic and diplomatic interests are asserted.

The government’s task will be to tread a fine line between security arrangements with its allies, principally the United States, and a relationship with China that is defined by Australia’s own interests and not those of anyone else.

In a thoughtful speech to Asialink before the G20 Summit in Osaka in June, Morrison outlined what appeared to have the makings of a “Morrison doctrine” on how to steer a course in treacherous waters between Australia’s security and economic lifelines.

The prime minister argued for a more activist diplomatic role in the region, aimed at securing Australian national interests in what are choppy waters. He said:

We should not just sit back and await our fate in the wake of a major power contest.

Australia could do worse than pursue an Asian equivalent of the Helsinki Accords that helped keep the peace in Europe during the Cold War.

This is a time for creative Australian diplomacy, not running off to Washington to hide behind America’s petticoat.

This returns us to the Hastie intervention and the national interest question.

Just as Hastie is entitled to express a personal point of view, so does the government of the day have a responsibility to assert what is in the national interest.

Clearly it is not in the national interest for political leaders to disregard comments that might have a negative impact on relations with Australia’s pre-eminent trading partner. China absorbs one-third of Australia’s merchandise exports.

This is what the prime minister had to say:

… the government is fully aware of the complexity that is involved in our region and the challenges that we face in the future… And we are careful as a government to ensure that we don’t seek to make them any more complex than they need to be. And that is what Australians can count on. We will be measured. We will be careful and we will put Australia’s national interest first.

Morrison needs to assert this point of view more forcefully if he is to avoid losing control of China policy. These is nothing inherently inconsistent between a national interest argument and one that enables dissident voices to have their say.

After all, this is not China.The Conversation

Tony Walker, Adjunct Professor, School of Communications, La Trobe University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Australia’s asylum seeker policy history: a story of blunders and shame


Carolyn Holbrook, Deakin University

This article was developed from a series of interviews with politicians, officials and other key players, including former Immigration minister Chris Evans and former Victorian premier Steve Bracks. Others preferred to remain anonymous.


We know very little about the kind of government Scott Morrison runs. After beating Peter Dutton and Julie Bishop to the prime ministership in August last year, most commentators assumed Morrison was keeping the chair warm until Labor’s Bill Shorten won the 2019 election.

Following the Coalition’s unexpected victory, it’s time to ask more searching questions, not only about Scott Morrison’s political values and policy aspirations, but about his prime ministerial style.

Recent history suggests processes of policy decision-making can make or break governments.




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Cruel, and no deterrent: why Australia’s policy on asylum seekers must change


Labor’s shambolic attempts to create asylum seeker policy during the Rudd-Gillard years are emblematic of the dire consequences when tried-and-tested processes of policy advice fail.

In the face of internal dissent, thousands of asylum seekers arriving by boat and a marauding opposition leader, the government rejected its most vital source of advice, the public service.

It began in 2009

In mid-October 2009, Prime Minister Kevin Rudd was informed that a vessel carrying 78 Sri Lankan asylum seekers was in danger of sinking in Indonesian waters. Rudd negotiated directly with the Indonesian president Susilo Bambang Yudhoyono and decided to dispatch a Customs vessel, the Oceanic Viking, to rescue the asylum seekers and return them to Indonesia.

The then immigration minister Chris Evans first heard of the plan when he received a phone call from Rudd’s chief of staff, Alister Jordan.

Jordan was not consulting the immigration minister, but rather informing him of a plan that had been enacted. Evans rang his departmental secretary, Andrew Metcalfe, who told him the plan would not work because the asylum seekers would refuse to disembark.

As Metcalfe had foreseen, the asylum seekers refused to leave the Australian boat at Bintan. Australian voice surveillance revealed there was talk of mass suicide.




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The standoff lasted four weeks, until a deal was struck that saw the Sri Lankans resettled in countries including New Zealand.

Officials in the Immigration Department were dumbfounded. One told me:

The Oceanic Viking was a thought bubble from Rudd … It was an absolute debacle. It was crazy. It had nothing to do with immigration but we were asked to go in and fix it up. And that scuttled any possibility of us doing anything with Indonesia for a long time.

The boats kept coming. There were 6,555 boat arrivals in 2010. On the night he lost the prime ministership to Julia Gillard, Rudd told the Labor caucus that if he won the leadership vote, he would “not be lurching to the right on question of asylum seekers”.

What Rudd didn’t mention was that the government had been actively exploring offshore options for some time.

The Immigration Department had prepared a list of possible sites for offshore detention that included Malaysia, Pakistan, Thailand, Indonesia, and East Timor.

Sounding out the East Timorese government

Evans was focused on pursuing a multilateral solution. His officials consulted with members of the refugee lobby, including the prominent lawyer David Manne, about being part of a broader regional arrangement that had the approval of the United Nations High Commissioner for Refugees (UNHCR).

Evans and his department worked on an offshore deal that would meet with the approval of Australian stakeholders, neighbouring countries, and the UNHCR. But meanwhile, a small group of ministers focused on East Timor.




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The former Victorian premier, Steve Bracks, was approached at an airport and asked to sound out the East Timorese government about a processing centre. Bracks reported back that Prime Minister Xanana Gusmao was interested, but he would need some time to win support within his government.

Gusmao wanted negotiations to be done through the president, Jose Ramos Horta. This process was in train when Kevin Rudd was overthrown as prime minister on June 24, 2010.

In a speech to the Lowy Institute on July 5, the new prime minister, Gillard, announced she had discussed with Horta the possibility of establishing a regional processing centre in East Timor. But in going public, she had pre-empted the internal East Timorese process. Gusmao distanced himself from the plan and it quickly fizzled.

Meanwhile, the public servants who had been working on the multilateral solution were left scratching their heads. One official told me:

I have no idea where [East Timor] sprang from.

We were working on arrangements … and one of the really difficult things was thought bubbles kept coming from funny quarters and then you’d have the media onto it, laughing at it or making a joke of it.

Failed Malaysia initiative

After the 2010 election, the new immigration minister Chris Bowen secured an offshore processing arrangement with Malaysia. Immigration Department officials had encouraged Bowen to bring refugee stakeholders and the UNCHR on board.




Read more:
Refugees are integrating just fine in regional Australia


But Bowen, who was facing immense political pressure from opposition leader Tony Abbott, preferred to deal unilaterally with his Malaysian counterpart, Hishamuddin Hussein, with whom he had developed a strong rapport.

Hours before the first 16 asylum seekers were due to be transported to Malaysia, Manne obtained an injunction against their removal from Australia, pending a challenge to the legality of the government’s agreement with Malaysia.

In September 2011, the High Court decided in a six-to-one decision that the Malaysia agreement contravened the Migration Act because the refugees would not be given the protection required by the Australian legislation.

According to a key player, the High Court ruling was the product of a profound failure of process:

the government did a very bad job at … going to the organisations who would be part of any solution. And, instead, pissed them off so comprehensively they went to the High Court.




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Robert Manne: How we came to be so cruel to asylum seekers


After the failure of the Malaysia initiative, the Gillard government hurriedly reopened the Nauru and Manus Island processing centres.

In 2013, then Prime Minister Kevin Rudd and Opposition Leader Tony Abbott debate about asylum seeker policy, and the ‘PNG solution’.

When Rudd replaced Gillard in June 2013, he announced that no one who arrived by boat would ever be settled in Australia. The boats slowed, but it was the institution of boat turnbacks under the Abbott government’s Operation Sovereign Borders that stopped them altogether.

The consequences of the Rudd and Gillard governments’ blundered handling of asylum seeker policy were considerable. Indonesia and East Timor were unnecessarily offended, the government’s political fortunes suffered and, most significantly, asylum seekers were again subjected to processing on Nauru and Manus Island.




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In Manus, theatre delivers home truths that can’t be dodged


It is conceivable that Manus and Nauru would have remained closed and Operation Sovereign Borders rendered unnecessary had the Rudd and Gillard governments heeded the advice of the Immigration Department to bring key refugee stakeholders and UNHCR on board into the process.

The institution of rigorous decision-making processes will not guarantee Scott Morrison’s success, but they could help him avoid many of the pitfalls that contributed to the downfall of the Rudd and Gillard governments.


Carolyn Holbrook is presenting a talk on this topic at the Australian Policy and History ‘History and the Hill’ Conference at Deakin University on Thursday, June 13The Conversation

Carolyn Holbrook, ARC DECRA Fellow at Deakin University, Deakin University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Cruel, and no deterrent: why Australia’s policy on asylum seekers must change


Alex Reilly, University of Adelaide

The Coalition’s election victory on May 18 had an immediate psychological effect on the refugees on Manus Island, with reports of several people attempting suicide.

Two class-action lawsuits currently before the High Court allege “torture”, “persecution” and “other inhumane acts” in Australia’s offshore detention centres. This action follows an action for damages in 2018 that the federal government settled for A$70 million, effectively admitting that the claims of mistreatment were well-founded.

The Iranian-Kurdish journalist and poet Behrouz Boochani, who has been detained on Manus for six years, has borne witness to a cruel system in his book, No Friend But the Mountain. Written secretly on a mobile phone, the book has won a swag of major Australian literary awards.




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Book Review: Behrouz Boochani’s unsparing look at the brutality of Manus Island


As a result of the testimonials of Boochani and others, the terrible conditions on Nauru and Manus are well-known. There are regular reports of physical and mental illness due to unsanitary conditions, cruel treatment and hospitals with no capacity to deal with the extent and severity of the health crisis among the refugee populations.

These reports reinforce the underlying cruelty of subjecting innocent human beings to indefinite and arbitrary detention in the first place. And to what end?

There is no justification for offshore detention

For many years, there has been no justification for the detention of asylum seekers on Manus and Nauru.

The original justification of deterring others from making the dangerous journey from Indonesia to Australia carries no weight. The point has been well and truly made that attempting to reach Australia by boat is a futile exercise. In the words of the allegations in the class action, the journey will result in years of:

…arbitrary, indefinite detention in tents, barrack-style buildings, or small, hastily constructed dwellings where living conditions lead to poor health […] physical, sexual and psychological abuses, [and] systemic mental distress.

The government claimed that the medivac law passed in February risked a new wave of boat arrivals and spent over A$180 million reopening the Christmas Island detention centre in preparation for new arrivals. The government has since committed to closing Christmas Island again. The expense involved in this political exercise is staggering, with absolutely no benefit to the taxpayer.

There has also been no new wave of boat arrivals. Deputy Prime Minister Michael McCormack revealed Thursday that a boat from Sri Lanka had been intercepted near Christmas Island this month. However, the details of who was on board, and why the boat was in Australian waters has not been made publicly available.

There will always be the occasional refugee boat arriving Australian waters for a variety of reasons, but it is important to distinguish these isolated occurrences from a reigniting of the people-smuggling trade.




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It’s high time the government ceased linking detention on Manus and Nauru to stopping the boats. The evidence does not stack up. As I, and others, have argued previously, the experience during the Howard years suggests that simply the possibility of offshore detention is a sufficient deterrent.

When the government settled asylum seekers on Nauru in Australia and New Zealand from 2002-04, without dismantling the offshore detention regime, asylum seekers did not begin arriving by boat.

Most asylum seekers in Indonesia are registered with the UNHCR and are waiting for resettlement through the UNHCR process. Their situation is admittedly desperate. Nonetheless, when interviewed after the passing of the medivac law, asylum seekers in Indonesia testified that they did not see taking a boat to Australia as an option.

It’s important to remember that asylum seekers have done nothing wrong in seeking our protection. Australia is a signatory to the UNHCR Refugee Convention, which establishes a responsibility to protect people who arrive on our border seeking protection. If offshore detention can be justified as deterrence at all, it must surely be kept to the bare minimum, in the context of our protection obligations.

Long-term detention is simply cruel and rightly labelled a “crime against humanity”.

Alternatives to detention

If there is even a remote possibility of a boat arriving in response to resettling refugees from Manus and Nauru in Australia and New Zealand, the government has many deterrence strategies at its disposal.

One novel strategy that avoids the need for offshore detention is Labor’s 2011 Malaysia arrangement. The deal was a simple one. In exchange for the transfer to Malaysia of 800 asylum seekers who arrived in Australia by boat, Australia would provide financial assistance to Malaysia and resettle 4,000 UNHCR-recognised refugees on top of existing commitments to resettle refugees from the region.




Read more:
Refugees and asylum seekers in Malaysia: the good, the bad and the unexpected


An important part of the arrangement was that those asylum seekers returned to Malaysia would not be penalised, and would be provided with housing, the right to work, and access to education for children.

The arrangement would act as an effective deterrent to people taking a boat to Australia to seek asylum because their expensive and dangerous journey would just result in their return to Malaysia. The Malaysia arrangement had the benefit of refocusing Australia’s response to asylum seekers and drawing in our neighbours to a regional response.

It’s critical that the Australian government take a new direction in refugee policy and move beyond its tired and false rhetoric of deterrence as a justification for detaining refugees on Nauru and Manus.The Conversation

Alex Reilly, Director of the Public Law and Policy Research Unit, Adelaide Law School, University of Adelaide

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Policies, not posturing, will help Albanese shake the ‘left-wing’ tag and restore faith in his party



Albanese has crafted his image as a knockabout bloke. But now he needs to craft an image as a potential prime minister.
Wes Mountain/The Conversation, CC BY-ND

John Wanna, Australian National University

Labor has taken a major gamble by appointing Anthony Albanese unopposed as party leader. His speedy elevation came because he was not tarred with the Bill Shorten-Chris Bowen brush that failed so spectacularly on May 18. So a cross-factional deal for a unity ticket held sway.

“Albo” has carefully crafted his image as a knockabout but likeable scallywag. He mixes easily with ordinary folks, “does” the local pubs and community centres, volunteers his services as an occasional DJ. He is a rugby league fanatic who regularly marches in the Sydney Mardi Gras and has a beer named in his honour. He’s an impish politician with a nose for a pithy or humorous riposte; an iconoclastic puncturer of hyperbole and bunkum (remember his throwaway dismissal of the “convoy of no consequence” when a pitiful truck convoy descended on Canberra).

Albanese was also Labor’s smartest parliamentary tactician as the Leader of the House in the Gillard government. He sees himself as a “commonsense guy” who is prepared to “stand up for what [he] thinks is commonsense propositions”.

He also has the distinction of remaining loyal to both former Labor PMs Kevin Rudd and then Julia Gillard, and has earned respect for this among his colleagues, unlike Shorten.




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Of more significance, he is from the left wing of the party, which could be a political millstone around his neck as leader.

He regards high office not simply as a vocation but as a messianic obligation. Given his advocacy of radical policies in his recent past, including death duties and redistributive taxes, his promotion to the leadership provides him with ample opportunities to shape the party’s policy agendas. He is, in reality, only the second left-wing leader of the ALP after the troubled H.V. “Doc” Evatt in the 1950s (Julia Gillard was nominally from the left, but more conservative than most of her party colleagues).

Anthony Albanese has cultivated an image of himself as a likeable scallywag, pub-goer, league fanatic and occasional volunteer DJ.
AAP/Daniel Munoz

Already, conservative media like The Australian have signalled a willingness to attack him along these lines.

Similarly, his political opponents have described him as “too left wing” to become prime minister. And some of his Labor colleagues from Victoria have argued that he is “too old and tired” to win an election.

In the Labor Party, the only real difference between the right and left factions is that the right don’t believe in anything much except that power is an end in itself. By contrast, the left are ideological, believe in social engineering and consider power as a means to pursue transformational agendas.

So, coming from the left may be Albanese’s Achilles’ heel, a vulnerability to his leadership. He has the opportunity in the immediate term to defuse many issues that bedevilled Labor over the past parliamentary term. These include: passing the Coalition’s full income tax cuts; agreeing to a bipartisan emissions target; working with the government on a joint policy towards Indigenous Australians; advocating a moratorium on further changes to superannuation; abolishing the symbolic medevac policy that feigns assistance to offshore detainees; and helping resolve some glaring disparities in welfare benefits.

But such concessions to the government would likely infuriate Labor’s tribal adversarial spear-throwers and its throng of left-Labor lawyers. An initial consensual approach, however, may make sections of the right-wing media look more closely at Albanese’s qualities as leader. Others might argue that “leopards cannot change their spots” and that Albanese will be confrontational and fight for redistributive agendas – making him a prime target for conservative media attacks that he remains a dangerous leftie.

Albanese now has two important imperatives – unify the party behind a refreshed policy agenda, and increase the party’s appeal to the community in order to rebuild the vote. Neither of these tasks is particularly easy, especially as Labor is likely to engage in a bout of recrimination after its recent disappointing electoral tilt.

He also has to work out tactically how to deal with the Morrison government basking in the afterglow of victory – so far, he has promised not to be an opposition leader like Tony Abbott, who opted for outright confrontational tactics.

Albanese’s immediate problems are to construct a shadow ministry on talent, not seniority or factional standing, with the right mix of skills to hold the government to account. He needs to match up his best performers against the high-profile or difficult portfolios (treasury, Indigenous affairs, water, NDIS) and the weaker government ministers (Stuart Robert, Sussan Ley, Ken Wyatt, Bridget McKenzie, Michaelia Cash and Greg Hunt). He will have to work out whether to give Shorten a significant shadow portfolio or find something else for him to do.

There are many in Labor’s caucus who demand more responsibility, especially women of ambition including Kristina Keneally, Katy Gallagher, Linda Burney, Jenny McAllister, Clare O’Neil, Ged Kearney, Terri Butler and Kimberley Kitching, as well as the likes of Jim Chalmers, Ed Husic, Stephen Jones, Murray Watt, Nick Champion and Andrew Leigh. Many of Labor’s previous front bench under Shorten failed to cut through and should be demoted.




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Grattan on Friday: Shocked Labor moves on – but to what policy destination?


Albanese’s Labor must address a series of debilitating and contentious policy areas – most of which should be either settled or defused. It needs to clarify where it stands on the big versus smaller government debate and whether increased federal involvement in multitudes of policy areas is prudent and responsible.

It ought to focus on the economy and increased productivity, while being less opportunistic on taxation proposals. For all Australians, Labor ought to allow a coherent set of policies on climate change and emissions targets. It could then consolidate effective environmental policies, rather than engaging in the chopping and changing that has characterised this sector (unlike our nearest neighbours in New Zealand). Labor has to define its position in relation to mining and, in particular, the coal industry. There is also scope to advance Indigenous well-being and some form of constitutional recognition.

Some mainstream media have speculated that the deputy leader, Richard Marles from the Victorian right, will be able to moderate any leftward drift under Albanese. This is possible, but the right faction is divided and fractious.

Albanese’s leftism represents a potential debility in the opposition’s platform, which a conservative government with wind in its sails might easily exploit.

The battle for the hearts and minds of Australians is more likely to be fought over practical and pragmatic policies than any ideological lurch to either the left by Labor or to the right by the government.The Conversation

John Wanna, Sir John Bunting Chair of Public Administration, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

How the major parties’ Indigenous health election commitments stack up



File 20190430 136807 4nqv25.jpg?ixlib=rb 1.1
Government policies on Indigenous health have so far largely failed in closing the gap.
From shutterstock.com

David Coombs, UNSW and Diana Perche, UNSW

Eleven years after Australia adopted the Closing the Gap strategy, many pressing First Nations health issues remain unresolved.

The gap between Indigenous and non-Indigenous life expectancy, currently 10.8 years for men and 10.6 years for women, is actually widening.

Similarly, the target to close the gap between Indigenous and non-Indigenous child mortality has not been met. The Indigenous rate of 164 deaths per 100,000 children aged 0-4 years is still 2.4 times the non-Indigenous rate of 68 deaths per 100,000 in this age group.




Read more:
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The causes of Indigenous health inequality are complex. They stem from social determinants such as employment, education, social inclusion, and access to traditional land, rather than strictly biomedical causes.

Government policies have a critical role to play here. But funding cuts, policy incoherence, and governments retaining control over resources and decision-making explain why the gaps between Indigenous and non-Indigenous health outcomes are not closing.

Regardless of who wins the federal election on May 18, these enduring health issues affecting Indigenous Australians will require sustained and concerted policy attention.

A look at the major parties’ policy promises reveals some signs of hope, but also plenty of room for improvement.




Read more:
Three reasons why the gaps between Indigenous and non-Indigenous Australians aren’t closing


The Coalition’s commitments

Aboriginal and Torres Strait Islander groups criticised the lack of Indigenous-specific health measures in the Morrison government’s first budget detailed in April.

The budget did include A$35 million for First Nations solutions to family violence, and A$10 million for the Lowitja Institute for health research.

Indigenous youth suicide remains an urgent policy concern, with Indigenous children five times more likely to die in this way than non-Indigenous children. A coronial inquest recently identified complex causes including intergenerational trauma, poverty, and problems stemming from the home environment.




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The Coalition’s budget committed A$5 million over four years to address Indigenous youth suicide. This figure has since been increased to A$42 million following criticism from First Nations organisations and advocates.

Meanwhile, the budget directed A$129 million towards the expansion of a cashless welfare card system that operates in a number of Aboriginal communities. The card quarantines 80% of welfare recipients’ income for use in government-approved stores, and on government-approved items, to prevent spending on alcohol, cigarettes and gambling. This decision was taken despite a lack of evidence these cards reduce social harm or public expenditure.

The government also made some pre-budget commitments around Indigenous health. These included:

The Coalition also honoured a previous commitment of A$550 million for remote housing in the Northern Territory.

The Morrison government deserves some credit for its part in reaching an agreement between the Council of Australian Governments and a coalition of Aboriginal and Torres Strait Islander peak organisations in December 2018.

This agreement commits governments and Indigenous peak bodies to shared decision-making and joint accountability in devising and working towards new Closing the Gap targets.




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Labor’s commitments

In keeping with its election campaign emphasis on health spending, Labor recently announced a A$115 million Indigenous health package.

The package includes almost A$30 million to reduce Indigenous youth suicide and mental ill-health.

It also offers A$33 million to address rheumatic heart disease, a preventable condition that disproportionately affects Indigenous children. The National Aboriginal Community Controlled Health Organisation (NACCHO) highlighted rheumatic heart disease as one of ten Indigenous health priorities for this election.

Labor has also promised A$20 million for sexual health promotion in northern Australia, A$13 million to combat vision loss, and A$16.5 million for the “Deadly Choices” initiative, which aims to prevent chronic disease through education.

Further, the opposition has announced a compensation scheme and healing fund for surviving members of the Stolen Generations and their families. This could help manage the effects of intergenerational trauma.

What’s lacking

Both parties’ funding commitments must be assessed in the context of the 2014 budget cut of more than A$500 million dollars to Indigenous affairs by the then Coalition government, which only the Greens have committed to restoring.

Impacts have been severe for specific programs, especially those run at the community level. These include youth services in Maningrida (NT) and employment and training programs in Inala (Queensland).

Funding for crucial Indigenous health infrastructure and capital works is also lacking, with the current shortfall estimated at A$500 million. Many Aboriginal Community Controlled Health Services are run from old buildings in desperate need of upgrades to accommodate increasing patient numbers and rising demand for services. The Coalition recently announced an incremental increase to infrastructure funding, but much more is needed.




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Neither the Coalition nor Labor has made any substantial commitment to a national Indigenous housing strategy. Inadequate, insecure and poor quality housing worsens physical and mental health through overcrowding, inadequate heating and cooling, injury hazards, and stress.

Similarly, both parties have been silent on reducing poverty in Indigenous communities. Poverty is another social determinant that contributes to Indigenous physical and mental ill-health, as well as high incarceration levels.

What about self-determination?

Labor has stated it will prioritise Aboriginal Community Controlled Organisations as the vehicles for delivering much needed health services.

As the Close the Gap steering committee’s shadow report emphasised, “when Aboriginal and Torres Strait Islander people are involved in the design of the services they need, we are far more likely to achieve success”.

The Coalition has been silent on the issue of community control, and funding reforms under the Indigenous Advancement Strategy and the Indigenous Australians’ Health Programme have destabilised the position of Aboriginal organisations.




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Community control is threatened by the government’s focus on competitive tendering, where First Nations organisations compete with “mainstream” service providers trying to secure contracts to deliver Indigenous health services.

Neither the Coalition nor Labor has outlined a response to these structural issues.

A final verdict

It’s difficult to identify major differences between the two parties’ Indigenous health promises. The likely impact of these polices is also hard to gauge given the significant role played by state and territory governments in service delivery.

Labor has promised to support Aboriginal Community Controlled Organisations but specific details have not been announced. Labor’s significant funding pledge for rheumatic heart disease, though, makes their Indigenous health offering perhaps slightly more likely to achieve health gains than the Coalition’s.




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Why are Aboriginal children still dying from rheumatic heart disease?


The Conversation


David Coombs, PhD candidate in Nura Gili Indigenous Studies, UNSW and Diana Perche, Senior Lecturer and Academic Coordinator, Nura Gili Indigenous Programs Unit, UNSW

This article is republished from The Conversation under a Creative Commons license. Read the original article.

View from The Hill: Malcolm Turnbull’s home truths on the NEG help Labor in the climate wars


Michelle Grattan, University of Canberra

An Easter weekend in an election campaign might be a bit of a challenge for a pair of leaders who were atheists. But fortunately for Scott Morrison and Bill Shorten, declared believers, it wasn’t a problem.

Both attended church services during the so-called campaign cease-fire that the main parties had proclaimed for two of the four days.

Morrison on Sunday was pictured in full voice with raised arm at his Horizon Pentacostal church in The Shire, where the media were invited in. On Friday he’d been at a Maronite Catholic service in Sydney.

Sunday morning saw Shorten at an Anglican service in Brisbane, his family including mother-in-law Quentin Bryce, former governor-general.

Neither leader was hiding his light under a bushel.

Church, chocolate and penalty rates

Sunday was an opportunity to wheel out the kids, chasing Easter eggs (Shorten) or on the Rock Star ride at Sydney’s Royal Easter Show (Morrison). This was campaigning when you’re not (exactly) campaigning.

The minor players weren’t into the pretend game. For them, the relative restraint on the part of the majors presented rare opportunity. Usually Centre Alliance senator Rex Patrick would have little chance of being the feature interview on the ABC’s Insiders.

But while Friday and Sunday were lay days for the major parties Saturday was not (and Monday won’t be either).

For Labor, Easter has meshed nicely with one of the key planks of its wages policy – restoration of penalty rate cuts by the Fair Work Commission. Even on Sunday, Shorten pointedly thanked “everyone who’s working this weekend”.

It was the start of Labor’s campaign focus turning from health to wages this week, when it will cast the election as a “referendum on wages”.

Turnbull resurrects the NEG

The weekend standout, however, was the intervention of Malcolm Turnbull, who launched a series of pointed tweets about the National Energy Guarantee (NEG).

Turnbull was set off by a reference from journalist David Speers to “Malcolm Turnbull’s NEG”.

“In fact the NEG had the support of the entire Cabinet, including and especially the current PM and Treasurer. It was approved by the Party Room on several occasions”, the former prime minister tweeted.



“It had the support of the business community and energy sector in a way that no previous energy policy had. However a right wing minority in the Party Room refused to accept the majority position and threatened to cross the floor and defeat their own government”.

“That is the only reason it has been abandoned by the Government. The consequence is no integration of energy and climate policy, uncertainty continues to discourage investment with the consequence, as I have often warned, of both higher emissions and higher electricity prices.”

He wasn’t finished.



“And before anyone suggests the previous tweet is some kind of revelation – all of the economic ministers, including myself, @ScottMorrisonMP, @JoshFrydenberg spent months arguing for the NEG on the basis that it would reduce electricity prices and enable us to lower our emissions.”

And then:

“I see the @australian has already described the tweets above as attacking the Coalition. That’s rubbish. I am simply stating the truth: the NEG was designed & demonstrated to reduce electricity prices. So dumping it means prices will be higher than if it had been retained. QED”

“The @australian claims I ‘dropped the NEG’. False. When it was clear a number of LNP MPs were going to cross the floor the Cabinet resolved to not present the Bill at that time but maintain the policy as @ScottMorrisonMP, @JoshFrydenberg& I confirmed on 20 August.”



(Frydenberg, incidentally, has lost out every which way on the NEG. As energy minister he tried his hardest to get it up, only to see it fall over. Now he is subject to a big campaign against him in Kooyong on climate change, including from high-profile candidates and GetUp.)

Turnbull might justify the intervention as just reminding people of the history. But it is damaging for the government and an Easter gift for Labor – which is under pressure over how much its ambitious emissions reduction policy would cost the economy. It also feeds into Labor’s constant referencing of the coup against Turnbull.

Turnbull’s Easter tweets are a reminder

  • the Coalition sacrificed a coherent policy on energy and climate for a hotchpotch with adverse consequences for prices;

  • it dumped that policy simply because of internal bloodymindedness, and

  • the now-PM and treasurer were backers of the NEG, which had wide support from business.

Shorten has strengthened his commitment on the NEG, indicating on Saturday he’d pursue it in government even without bipartisan support.

“We’ll use some of the Turnbull, Morrison, Frydenberg architecture, and we will work with that structure,” he said.

Given the hole it has left in the government’s energy policy, pressing Morrison on the economic cost of walking away from the NEG is as legitimate as asking Shorten about the economic impact of his policy.




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The Conversation


Michelle Grattan, Professorial Fellow, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

One Nation, guns and the Queensland question: what does it all mean for the 2019 federal election?



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Pauline Hanson claims the Al Jazeera undercover “sting”, which has grabbed international headlines, was a media “stitch-up”.
AAP/Dan Peled

Chris Salisbury, The University of Queensland

Of all the controversies to conceivably bring Pauline Hanson undone, private discussions about gun law amendments wasn’t an obvious candidate.

Yet her recorded comments about the 1996 Port Arthur massacre and subsequent gun law reforms are potentially destructive for her One Nation party. Only potentially, though; Hanson’s supporters have long shown a propensity to forgive or shrug off her party’s outlandish or shocking assertions.




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Already, Hanson and party colleagues have shifted blame for the Al Jazeera “sting” to a media “stitch-up” and, they claimed, foreign political interference by an “Islamist media organisation”.

Presumably some Hanson adherents will find that plausible – the party has made anti-Muslim rhetoric part of its regular platform. Other One Nation supporters might now question the principles the party claims to stand for.

Why guns policy?

Why would One Nation seemingly risk whatever political capital it possesses by flirting with changes to gun controls and seeking assistance (if not funding) from gun lobby groups?

The party’s nativist policy positions on refugees, immigration and foreign investment are well known and readily detailed on its website. Until now, gun law amendment has sat well behind these. One Nation’s listed policies on firearms regulations include increasing penalties for gun-related crime and “streamlining” weapon licensing requirements. Not exactly controversial stuff.

But it is important to remember that the party first emerged in the wake of the Port Arthur shootings and rural resistance to the Howard government’s gun ownership reforms. Hanson and her candidates campaigned in the party’s early years on relaxing John Howard’s laws. They also benefited politically from a mainly regional backlash against these – and against Howard’s National Party partners.




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Recently highlighted connections between Australian gun lobby groups and minor parties, including One Nation and Katter’s Australian Party, bring the backdrop to this policy agenda into sharper relief.

One Nation’s original and more recent platform caters to disaffected, largely non-metropolitan constituents who feel the party’s anti-immigration, anti-foreign business and anti-government intervention policies “speak for them”.

In its recent incarnation, One Nation has tried – and found ready accomplices in sections of the media – to “mainstream” its appeal and some of its positions. It’s been observed that the party’s Senate members have regularly supported the Coalition government’s legislative agenda during this term, on matters ranging from the reintroduction of the Australian Building and Construction Commission (ABCC) to reduced welfare spending.

The party’s suite of published policies covers matters of concern to many Australians, such as power prices, transport infrastructure, water supply and jobs creation.

In this respect, it was perhaps not so surprising that Liberal MPs should describe the party as “more responsible” than its earlier manifestation. Even former prime minister Tony Abbott, Hanson’s one-time political nemesis, endorsed One Nation owing to its “constructive” relationship with the government in parliament.

But this normalisation fails to mask the party’s extreme stances or inconsistent policy positions – even between its own members. One Nation adheres to curious policies decrying United Nations infringement on our sovereignty, as well as questionable claims about evidence-based climate policy.

Then there is the attention-seeking behaviour: Hanson wearing a burqa in the Senate chamber; or Queensland Senate candidate Steve Dickson suggesting the Safe Schools program involved teachers instructing students in masturbation techniques; or New South Wales upper house candidate Mark Latham proposing Indigenous welfare recipients undergo DNA testing. Stunts like these place One Nation firmly on the political fringe – though not without fellow dwellers. Notoriously, Coalition senators scrambled to backtrack on supporting Hanson’s Senate motion decreeing that “it’s OK to be white”.

Stunts such as Pauline Hanson wearing a burqa in the Senate place One Nation on the political fringe.
AAP/Mick Tsikas

This latest party engagement in seeking out overseas gun lobby assistance highlights another inconsistency, given Hanson’s vote in the Senate supporting new restrictions on foreign donations.

The Queensland question

Considering this, why do One Nation’s policies seemingly still appeal to significant numbers of voters, particularly in Queensland? Traces of an entrenched conservative political culture thumbing its nose at “the establishment” partly explain the party’s appeal in Queensland (and perhaps some of Peter Dutton’s ill-judged, racially charged comments as immigration minister).

It’s a culture underpinned by a history of less diverse migrant influence than other parts of the country and arguably a more wary, paternalistic past regarding Indigenous and minority communities.

Another reason is the accentuated city-country divide in Australia’s most decentralised mainland state. Here, some agrarian-themed party policies – such as for dam building or vegetation management – directly pander to regional voters. As a minor party not in government, though, One Nation has limited opportunity to carry these through, beyond aiming to wield balance-of-power influence in the Senate.

More telling is One Nation’s claimed inheritance of an old National Party constituency. It is one that feels “left behind” – a sentiment the Shooters, Fishers and Farmers Party successfully tapped into in the NSW election.

As in the past, the Nationals will seek to differentiate themselves from their Coalition partners and marginalise One Nation and other far-right parties ahead of the 2019 federal election.

But that’s no easy feat in Queensland. Since the Liberal and National parties merged in the state to form the LNP in 2008, there has been no distinct outward National Party. Some rural and regional voters in Queensland have felt unrepresented to a certain extent, and their grievances have placed many in a resurgent One Nation camp.

The party’s identification with aggrieved outer-urban and regional conservative interests keeps its voters’ preferences an issue. Again, this is especially so in Queensland, where several LNP MPs hold seats in such areas on tight margins.

But following this week’s revelations, and particularly in the wake of the Christchurch shootings, the preference issue will bedevil the Coalition in this state and elsewhere.




Read more:
Guns, politics and policy: what can we learn from Al Jazeera’s undercover NRA sting?


The prime minister’s latest announcement directing the Liberal Party’s state branches to preference Labor ahead of One Nation sends a needed message, but not unequivocally. It apparently leaves Liberals free to place One Nation ahead of the Greens or others, and is ambiguous on how this will apply to all LNP MPs in Queensland, or possibly influence Nationals MPs elsewhere.

But the clamouring of Queensland’s Nationals-aligned MPs for new coal-fired power stations – mirroring One Nation policy – indicates their likely preference leanings in favour of the minor party (and presumably leaves the Greens last of all).

The recorded actions and comments of Hanson and her party colleagues could bring a political reckoning for One Nation at the coming federal election. Voters will soon judge if the party warrants their electoral support and decide if this new controversy is a bridge too far.

For its part, the Coalition is treading a line between getting its hands burned over preference “deals”, as happened at Western Australia’s last election, or doing as John Howard (ultimately) did and jettisoning One Nation preferences altogether.The Conversation

Chris Salisbury, Research Associate, The University of Queensland

This article is republished from The Conversation under a Creative Commons license. Read the original article.