Will our Glad have a chair when the music stops?

Oct 21, 2020

Spare a thought for the personal tragedy of Gladys Berejiklian, a genuinely hard-working and on the face of it a decent premier of NSW. Brought low because she formed a long-term personal relationship with a spiv, one whose general dishonesty and abuse of power seems to have extended to trading on her credit.

At the time of writing this, on Friday morning, her political as opposed to her personal fate is unclear. But whether it happens today, or next week, her position is untenable. This is not because of her poor personal judgment in choosing a partner – not yet a hanging offence. It  is because of her appalling political judgment in letting a partner, let alone a clear wide boy, into the rooms where power is exercised. Even if she were actually unaware of how much he was misusing her name, or his wider contacts in government, she was on ample notice, from previous ICAC hearings and from her own dismissal of him from her party, of his approach to misuse of office. One may personally overlook such a peccadillo in a friend; one cannot claim the same thought of innocence and affection in stewardship of public office.

But her enemies and rivals, in her own party, or the coalition, or in Labor or in the wider community, should take little pleasure in her humiliation, loss of reputation and clout.  It is her bad judgment, and not, as far as can be seen, her exercise of power that has caused her problems.

I am not one for arguing that the calibre of top politicians is improving or deteriorating over time, but I do think that the environment in which they can falter has changed quite a bit. We have always had politicians with high standards of honour and others who would do anything they thought they could get away with, even to petty venalities such as cheating on living allowances. But the disposition to be dishonest depended a good deal on the prevailing moral climate, and on that complicated calculus about the risk of being caught, and the nature of the consequences, if one was. As with most white-collar crime, the usual consequence of being caught was public disgrace, so the best way of discouraging bad behaviour is and always will be a substantial investment in catching and exposing bad behaviour.

Some would argue that the good character and reputation of Berejiklian, as well as the humiliation she has had to endure, should mean that she should get the court equivalent of a good behaviour bond – sight unseen on whether she is shown to have had any actual knowledge of, or involvement in Daryl Maguire’s get-rich-quick schemes.

But a significant penalty, political or otherwise, is necessary so as to remind everyone in the game that one must not, should not, turn politics into a source of private profit. It is not, heaven knows, that they only need a nudge and will quickly get the message. Look, for example, at Daryl Maguire himself. The cause of the present inquiry, he clearly learnt nothing from a shaming by ICAC three years ago, then his expulsion from the Liberal Party (at the insistence of his close personal friend, Gladys Berejiklian) and resignation from parliament.

 The latest ICAC hearing is testimony to his still being on the make, unchanged even in guile and concealment. His personal friend might have hoped or expected that he would give up his errant ways, but there was not much sign it was happening, and many indications that, for him, it was business as usual in his quest to find an earner. Berejiklian has been around long enough that she ought to have had a deeply cynical view about whether leopards can change their spots.

It seems to me that the moral environment and generally accepted senses of where the public interest is has changed significantly over the past 40 years. I do not mean to suggest some past golden age when everyone adhered to the rules, so much as a time when there was more general agreement about what the rules were. The broad rules about politics were but a subset of generally accepted principles, ethics and standards of public life, that also operated in business, in banking, in the military, in educational establishments, and among religious establishments.  The change is the more remarkable given that during the same period, laws, judgments and statements of expected standards of conduct have tended to become more explicit, more strict and more focused on respect for public interests. Has it all been window dressing for doing the very opposite?

Some of the decline in political standards has accompanied a fall in the standards and ethics of other public institutions, and in the professions. Which caused, or which followed, which is not clear but the impact on reputation and public regard has been severe. For example, child sex abuse inquiries, here and abroad, have done so much damage to the authority and reputation of churches that in Ireland, bishops decided not to campaign against a same-sex marriage referendum for fear that their opposition would increase the vote for the proposition.

Another example has been the deplorable behaviour of bankers, from the top down, and of financial advisers, identified by the Hayne royal commission. That example is the worse because it now seems apparent that those two institutions have resumed the rape and pillage of customers and the public interest. The banks served a short period in the stocks, even if no one was prosecuted, or, even now, seems at risk of it. There were fresh problems, for example with reporting money movements, with negotiated settlements. But we seem to be forgetting, or forgiving, because of the distraction of the pandemic, and  efforts to revive the economy, or a shift of public outrage to other economic cancers in society. And in the process the prime minister and treasurer ceased to be incarnations of public wrath and instead want to be servants of the villains again.

The very idea of a banking inquiry was stoutly resisted by the then treasurer, Scott Morrison. He patiently explained that if there were, or had been, any problems, they were the problems of a few rotten apples in every barrel. In any event, we were told, strong proactive decisions by Morrison had already shut down the rorting, if any. Moreover, there was a risk that exposure of rorts might harm the reputation of banks, perhaps causing a run.

Morrison was dragged reluctantly to the commission, primarily because some Nationals threatened to defect. The subsequent inquiry proved that every proposition advanced by Morrison was wrong. The problems were systemic, and entrenched, and involved not only people at the top of the system, but the culture at all levels. Morrison had hoped to cause collateral damage to industry super funds, to the advantage of the financial advice industry, but even that was a colossal own goal. The banks and others in the financial advice industry – big donors to the Liberals – were shown to be ripping off customers and providing inferior returns. As a demonstration that this is a government that is bought rather than rented, hurting industry super funds is back on the agenda again.

If  Morrison and, for that matter, an increasingly captive and supine Treasury did not know how crook the banks and their favourite bankers were, or about the chronic problems of “light-touch” regulation, they were far less expert in the game than they pretended. Or perhaps, as some of their critics alleged, they were more the captives of the system than the guardians of the public interest, including Australia’s financial stability.

Since when have we had a tradition about the “right” of parliamentarians to conduct businesses, or to earn extra-parliamentary income, especially as middlemen, lobbyists and arrangers of meetings? We might once have had a dispensation of sorts for farmers – and, at one time, barristers – but our politicians should not be beholden to others for money, let alone be able to be tempted by the prospect of money they have not really earned. A Commonwealth or NSW backbencher makes more than the American president. The conflicts of interest are not matters that can be dealt with by rigorous disclosure regimes.

Gladys was in trouble once she knew Daryl was in business – even if, as she has claimed, she was studiously uninterested in the details. She had no right to assume that he was following the rules. Especially once she understood that it was about land development, “success fees” and “little earners”.

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