JOHN MENADUE. Some Coalition legacies that a new government must confront

There are several major issues that dominate public life today and require resolution. Those issues are –the growing existential  threat of climate change, the dire consequences following the Iraq invasion, tax cuts during the mining boom that result in continuing budget deficits and debt increases, the NBN debacle, hostility to refugees and asylum seekers, and problems with foreign influence and political donations . 

Climate change and carbon pollution

In 2008 the Coalition continued to deny climate change. It therefore opposed and defeated the Carbon Pollution Reduction Scheme proposed by the Rudd Government which would have laid the basis for carbon reduction through a market mechanism. It would have promoted renewable energy and lowered energy costs. This was a major setback in addressing climate change and carbon pollution.

The Coalition added to its unfortunate record on climate change and carbon pollution by repealing the carbon tax of the Gillard government, which was showing clear signs of curbing carbon pollution.Business interests including the BCA were implicit in opposing market based means to reduce  carbon pollution

The ensuing climate change confusion discouraged investment in new technology. Energy costs rose as a direct result of Coalition opportunism. Encouraged by its right wing base, the Coalition has continually scare-mongered about renewable energy. We saw that disgracefully in SA. Looking to the past the Coalition brought a lump of coal into Parliament. Perhaps unwittingly it was mocking itself in its attempt to construct an energy policy without an emissions policy., The National Energy  Guarantee ended in failure when the right wing zealots in the Coalition sabotaged it.

Renewable energy is the energy of the future, not coal .But the extreme right in the Coalition is tied to the past and Scott Morrison dare not confront them. To avoid the hard issues he rebadges old,expensive and failed projects.

The progress that we have made in reducing carbon emissions through renewable energy is in spite of government polices. Home owners and invested have embraced renewables in a world leading way.

The OECD has reported that Australia is not on track to meet the emission targets under the Paris Agreement.

The OECD also points  to a dismal record on other key environmental issues;Australian wildlife is in a poor state and the position is worsening, only one of the ten targets of the National Biodiversity Conservation Strategy have been met,about 50,000 mining sites around the country need rehabilitation and state government agriculture, mining and forestry policies are often at odds with environmental objectives. Overall it is a very sorry story.

Joined at the hip,Iraq ,terrorism and refugees

The US invasion in 2003 that the Coalition strongly supported has brought death to hundreds of thousands of people and forced millions from their homes and countries. The invasion has destabilised Iraq and adjoining countries. It triggered the civil war in Syria. The invasion  has promoted widespread political, religious, ethnic and tribal conflicts across the Middle East. Our involvement in Iraq has brought terrorism to our shores. Terrorists are here because the Coalition sent our troops  over there.

No Australian person bears greater responsibility for this ongoing tragedy than John Howard who enthusiastically took us into the Iraq War.The Coalition today holds him up as an icon.

Our cooperation  today with Saudi Arabia and UAE,both cruel dictatorships is inflicteing enormous suffering on the people of Yemen

Yet the Coalition postures that it alone can be trusted with our national security and to protect us from terrorism which it exaggerates for political advantage.

All ADF forces should be withdrawn from the Middle East as soon as possible. That would make us more secure and law abiding.

Out dependance on the US, made more dangerous by Donald Trump has dragged us into futile wars, one after another

We may now be asked by the US,along with the British and French to take over the US role with the Kurds in Northeast Syria.. We should refuse.

The budget deficit and government debt

In the 2013 election, Tony Abbott campaigned stridently about deficits and debt as a result of the Gillard and Rudd governments. When Tony Abbott took office our net national debt was $A175b. It was $A341b in July 2018, an increase of 95% over 5 years.

Yet the seeds of continuing government deficits and government debt were planted by the Coalition when Peter Costello was Treasurer during the mining boom. For short-term political benefit, he substantially reduced taxes and we are now bearing the long-term consequences. Superannuation pensions were made tax free. There were concessions for negative gearing and capital gains. These concessions have left us with an enduring budget deficit and debt problem.

The ALP cannot be excused entirely. After its successful response to the global financial crisis it failed to reform the tax base as proposed by Ken Henry.

But the real culprit was the Coalition and particularly John Howard and Peter Costello for our continuing budget deficits and government debt. As the Parliamentary Budget Office put it ‘Over two thirds of the five percentage points of GDP decline in structural (budget) receipts over the period 2002/3 to 2011/12 was due to the cumulative effects of the successive personal income tax cuts granted between 2003/4 and 2008/9.’ 

The IMF came to the same conclusion. It identified two periods of Australian ‘fiscal profligacy’ in recent years, both during the Howard government period – at the start of the mining boom in 2003 and during its final years in office between 2005 and 2007.

Yet the Coalition portrays itself and the public seems to agree that conservatives are better economic managers. The evidence from the Howard-Costello years does not support this.

By not taxing my superannuation Costello has considerably helped my budget but it is a calamity for the national budget.

Morrison and Frydenberg are following the example of Howard’s and Costello’s  last years in office, emptying the coffers to make it hard for a new government. The $1.4 b spend on Christmas Island is just the latest example. It has little to do with health support for refugees. It is politics pure and simple. It is sheer waste. A white elephant for black political purposes. We know that there are 450 vacant beds in detention centres in Australia.Another media blind spot!

 The NBN

Tony Abbott called the NBN a ‘white elephant’.  Taking that cue from his Prime Minister, Malcolm Turnbull, the Minister for Communications in effect sabotaged a possible world-class NBN by refusing to support fibre-to-the-premises. We got a second-rate system as a result with an expected cost of over $50b. Just imagine if a Labor Government wasted money on such a scale. Recall the histrionics and over kill of the Coalition and News Corp. on pick batts. and school building fund that helped save us from the GFC. Those were ‘pocket money’ projects compared with mega bucks  the Coalition has blown on the NBN

The problem goes back to the Coalition and John Howard, with the privatisation of Telstra in three stages in 1997,1999 and 2006.  If at least the wholesale arm of Telstra had remained in public hands, a separate and new NBN company would not have been necessary.  Without John Howard’s privatisation the publicly owned wholesale arm of Telstra would have rolled out an NBN as part of its normal business operations.  That is what happened in New Zealand and why New Zealand has a far better telecommunications system than we have.

The Coalition, with John Howard as Prime Minister, through the privatisation of Telstra, has left us with an appalling legacy, a second-rate NBN. Malcolm Turnbull compounded the mess. This Coalition legacy  has to be fixed.

Home Affairs and Stopping the boats

The Coalition postures that it stopped the boats, and that it alone can be trusted to keep our borders secure. Once again, the evidence does not bear this out.

In this blog, I have argued that Tony Abbott did not stop the boats. By the time Operation Sovereign Borders came into effect in December 2013, boat arrivals had been dramatically reduced from 48 in July 2013 to 7 in December 2013. The boat ‘crisis’ was very largely over by the time the Abbott government policies came into effect. OSB was really engaged in a minor clean up when the main game was over.

Further, the Coalition was responsible for the surge in boat arrivals after September 2011, when it opposed and defeated in parliament, amendments to the Migration Act which would have enabled the government to implement the Malaysian Arrangement. Before those amendments were defeated in the parliament, boat arrivals were running at about four to five a month. When the people smugglers saw that the government’s attempt to curb them had failed as a result of Coalition action in the parliament, they stepped up their activities once more. Boat arrivals steadily increased from the four to five per month, to 30 to 40 per month in the middle of 2013. Tony Abbott and the Coalition gave the green light to people smugglers by striking down the Malaysian Arrangement.

And most recently Abul Rizvi in this blog has highlighted that with boats stopped there has been a dramatic increase in asylum seekers coming by air.. In 2014/15, 8587 asylum seekers came by air. By 2017/18 the number had increased to 27931. Our borders have never been less secure. The people smugglers, particularly in Malaysia and Southern China have outsmarted Peter Dutton and the Department of Home Affairs.

The Department of Home Affairs is in a mess with poor morale,delays in processing,record numbers breaching our border by air and highly dubious contracts with fly by night companies for building detention centres. Perhaps it may need a Royal Commission to sort out the mess and importantly the end of Peter Dutton. He has a sorry record- failure in Health,Immigration and Home Affairs and of course the toppling of a Prime Minister.

Yet the Coalition postures that it stopped the boats and only it can be trusted to keep our borders secure. The evidence does not support this proposition. Unfortunately the media yet again failed to examine what really happened.

 

Foreign influence and political donations

The anti-Chinese narrative at the present time is being led by our intelligence and security agencies and some maverick  journalists. The Coalition is being dragged along behind. .

Former ALP Minister,Senator John Faulkner canvassed a suite of measures to promote ‘Integrity in Government’. It included a National Anti-corruption Plan, Public Interest Disclosure, including protection of whistle-blowers, a Code of Conduct for MPs, an Independent Parliamentary Budget Office, an Open Government Partnership and Electoral Funding reform.

Only some of this was implemented. Unfortunately the critical electoral funding reforms which included prohibition of anonymous and foreign donations was rejected by the Coalition in the Senate in 2009. If only we had nipped the problem of foreign influence and donations in the bud in 2009, the present anti-Chinese narrative and xenophobia could have been avoided or at least lessened.

The Coalition is responsible for the debilitating legacy we bear on each of these major issues. The media also has a convenient memory in ignoring and forgetting a lot of this legacy. Many were complicit in failing to properly examine these major policy mistakes for which we now bear a heavy burden.

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7 Responses to JOHN MENADUE. Some Coalition legacies that a new government must confront

  1. Bevan Ramsden (BE-Elec and ex-Telecom lines engineer) says:

    Totally agree with John Menadue that the root causes of the NBN roll lout disaster goes back to the privatisation of Telecom. Fibre to the home would have been their preferred upgrade technology and implemented in the normal course of business and indeed financed through its business which was very profitable with excess fed into the public purse.
    The ideological pre-occupation with privatising public enterprises has resulted in Australia getting a poor internet and telecommunications upgrade with many still dependent on an aging and unreliable final copper connection from the fibre nodes ; a ‘goat track’ at the end of a ‘multi-lane freeway’. This final link into the home in copper will still have to be addressed in the future at a large additional cost and meantime we suffer a seriously flawed system

  2. steve jenkin says:

    On the NBN:
    there are a few additional points that I consider important-

    * The deliberate waste of public money is much worse than stated. Yes, the peak-funding is $8B-$10B more at $50+B, but Quigley’s FTTP plan was for just $30.4B of govt. equity with a decent (7%) return – so the public is tipping in an extra $20B, at least, with at most 2%-3% return, to create a stranded asset which must be scrapped to build FTTP.
    There also now multiple analyses that at least $20B will have to be written off – that the MTM-NBN will never recover it’s construction (peak-funding) costs.
    The LNP are spending $50B+ to build a $20B-$30B asset, which will then require billions to catchup to the 2013 FTTP Plan, and we’ll never recover all the lost revenue – 30 years at $2B-$3B profit/yr. Turnbull in 2014/5 even helpfully had NBN Co price the cost of restarting & completing an FTTP: over $25B.

    The LNP’s “destroy the NBN” policy was never rescinded and their actions in Govt are only consistent with them completing that policy, with the taxpayer footing the bill.
    The cost to the taxpayer in deliberate waste, asset write-downs, foregone profits, remediation works and loss on sale price is closer to $100B.
    (+$20B construct, $25B remediation, $20B lost profits, $25B write-downs)

    * Record high retail Electricity & Gas prices are due to market failure & poor regulation – exactly the reasons we _had_ to have the NBN. Since privatisation, both markets have not just failed to deliver any of the promised benefits to consumers (& ACCC’s mantra still is “we need more infrastructure competition”), but market failures through monopoly/ oligopoly pricing and aggressive anti-competitive actions.

    * In comms we’ve seen wasteful ‘overbuilding’ in concentrated markets and elsewhere either a monopoly provider or no service:
    HFC cable, 2G, 3G & 4G mobile, ADSL2, CBD & long-distance fibre, international cables, VoIP and “Over the Top” streaming services.
    Tassie has been held hostage to monopoly players for decades – it’s more expensive to move bytes across Bass Strait than SYD-USA. This is a market failure.

    * We’ve “seen this movie before” when AUSSAT was destroyed financially (forced to debt-fund, no Govt equity for 2nd-gen sats) and hobbled commercially. Just like NBN, it was _not_ given a full Telco license & banned from retail. For several years before the end, the head of AUSSAT was vociferous in publicly advocating for a full Telco license and for his biggest competitor to be removed from his board. The government than gave away the business “for debt” and threw in for free all the goodwill, a large client list/ contracts (defence, …), a zero-delay startup, a full Telco license and a 5-year relief from other competition.

    The substantiation of his position is the competitive longevity of Optus, albeit not under the original, but second owners – a foreign government owned firm, SingTel.
    If the Singapore Govt can run a profitable Australian Telco, why can’t ours?

    * In 1991, when privatising Telecoms, three public telcos (AUSSAT, OTC, Telecom) were merged, there was no pretence of building a competitive market, but the reverse. The two largest Telco’s, Telecom & OTC, were merged with the smallest sold to private sector, guaranteeing a dysfunctional and lop-sided market from day 1.

    * There was another commercially absurd and anti-competitve regulatory move made at the same time:
    requiring the first two Telco licensees to also install Cable TV.

    This was exactly wrong, it was known at the time that ‘Cable’ was a competitive, not complementary service. In 2003, the OECD wrote a report on the _only_ two countries in the world where there was a failure in the Cable TV market: Australia & Portugal. In both, Telcos also owned Cable TV networks.
    In every other country, Cable Broadband was rolled out in competition against incumbent Telcos, creating real competition in the market & rapid development of the rising market.
    In Australia we had Telstra refusing to do anything until forced (ADLS1 & pricing), then having the ACCC force them multiple times to be behave competitively.

  3. ANDREW FARRAN says:

    Regrettably UN Mandates are a thing of the past. Sometimes you can’t wait for the policeman when the victim is lying on the street – or could be!
    Still scope for noble ideas when they are practical and thought through. It boils down to context which mostly is lacking.

  4. ANDREW FARRAN says:

    Everything about the Iraq war and its onsequences has been disastrous, not least the manner in which we became involved in the first place.
    Everything about US military engagements since before Vietnam have been similarly so.
    Are we going to learn any lessons from this when next confronted with a decision to join in future US escapades – some of which will raise tricky issues like Taiwan, South China Seas, and possibly Iran? The main lesson now is to ensue due process over War making decisions that includes better consultation with the electorate and Parliament, going beyond Cabinet and its secretive purposes. We are not faced with invasion and will have plenty of time for prior consideration before any foreseeable eventuality.
    Unfortunately our defence force structure is still being aligned for joint action with US forces and little else which means we have already chosen between the US and China in ALL circumstances. How preemptive and preclusive of an independent foreign policy.

    I have some sympathy for the predicament of the Kurds in Syria on the Turkish border. They have been fine allies and get short changed at every turn. We should be prepared to use our remaining forces there in a strictly peacekeeping role to provide the Kurds with moral support. This would not be a crusade. Just an act of simple decency.

    • John Forrest says:

      “.. use our remaining forces there in a strictly peacekeeping role..”
      A noble idea if we had a UN mandate and/or were invited by the Syrian government.

  5. Chris Blaikie says:

    Correction ’50 000 mine sites around the country need rehabilitation’
    from the OECD Environmental Performance Reviews: Australia 2019 (part 2.4.3)
    http://www.oecd.org/australia/oecd-environmental-performance-reviews-australia-2019-9789264310452-en.htm

    “Our cooperation today with Saudi Arabia and UAE,both cruel dictatorships is inflicteing enormous suffering on the people of Yemen”

    Yes it very much sounded like Christopher Pyne was saying the other day at his retirement that ADF personnel were in UAE in an official capacity rather than some sort of private, mercenary capacity.

    “The anti-Chinese narrative at the present time is being led by our intelligence and security agencies and some maverick journalists. ”

    …and Clive Hamilton.

    “Many were complicit in failing to properly examine these major policy mistakes for which we now bear a heavy burden.”

    Yes Australia is not far off dystopian disaster.

    You could have mentioned the treatment of welfare recipients also as an important addition to this mess we are in.

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