What on earth is going on?

Just what on earth is going on in Canberra?

We get an inquiry into a scandal before the pressure really starts to mount. Back-benchers are speaking out on principle. The Prime Minister seems to suggest that free speech is actually okay and the Government is busily demonstrating its lack of commitment to the market.

The Rau inquiry appears to have some interesting implications. The conventional political wisdom has always been that when some sort of inquiry is inevitable, get in first with a controlled and limited one to try to get the right result. You just need to make sure, as Neville Wran once observed, that you know the outcome before you initiate the inquiry. This has not been the Howard Government’s conventional wisdom which normally consists of resisting scrutiny for as long as possible and then relying on various layers of deniability to avoid any unexpected finding.

The Rau inquiry, however, may be more than just a return to a more normal political conventional wisdom.

There has been speculation for some time that detention is not as great a vote-winner as it was and that there have been changes in community attitudes on the subject. Those who think this have been hoping that the Rau case may be a turning point – or some sort of catalyst – simply because it is so awful in its implications. It would be nice if it is and the PM’s response suggests it just might be. Because, when you ask the question as to why the sudden change of tactic and the quick inquiry a number of possible answers spring to mind? It could be that the Government is changing its spots – although the lack of an apology and the Minister’s responses make that unlikely. Or it could be that the hard-headed conclusion is that the public is not likely to just “move on” from this one. Add in some backbenchers (if only Petro and Malcolm at this stage) actually speaking like liberals and something significant may have changed.

The PM and free speech comments were almost as astonishing as the rapidity of the Rau inquiry. The PM has now twice said words about free speech. The first time was quoted in The Age on February 1 2005 when he said: “You can’t have a situation where every time someone expresses a view they are jumped upon from a great height. This is Australia.” This weekend he used similar words in a TV interview. Now he’s expressed similar views before – usually in the context of attacks on “political correctness” and in justifying why Pauline should be allowed to have her say.  But once again one has to ask whether this time it might be slightly different – not so much in terms of political principle of course – but in terms of practicality.

Obviously he doesn’t mean it literally, as Ivan Molloy and anyone who has ever questioned any policy of George W. knows. It is after all still un-Australian to be anti-American or to express views anywhere to the left of Piers Ackerman and Andrew Bolt. But perhaps he means it in the sense of preparing the ground for a situation in which the hitherto iron Coalition discipline frays around the edges and people start to say what they think.

…and the market? No-one seriously thinks this Government is committed to markets or freedom when either are at all inconvenient. It is, along with the US Republicans, part of the new breed of big government conservativism. A major characteristic of such government is high taxation which is then used in various middle class welfare rorts – such as the new subsidy to so-called “low income” superannuation contributors who are, in reality, normally part of high-income households where one partner is working part-time. Another characteristic is the over-riding emphasis given to “national security” and the current bleatings about Xstrata are part of that. It should be remembered by those who are arguing the case that it can only be mounted because Xstrata is Swiss-domiciled. If it was US-domiciled the free trade agreement would trump the national interest card. The last characteristic is not exactly new – being in favour of free markets and globalisation so long as these do not include immigration or the rights of workers to bargain for higher wages. In the latter case, as we have seen with the H.R.Nicholls crowd, it’s Marx and Ricardo rather than Smith and Mill who rule.

Social security assumptions – again

Over the past few months Miscellany has passed on various thoughts from various commentators about the assumptions underlying the case for Social Security privatization.

Basically the “crisis” case is predicated on falling economic growth, falling productivity, increasing unemployment and generally tough times. However, the case for why private pensions work better is predicated on assumptions which are exactly the opposite.

Paul Krugman, in the New York Times (4 February 2005), points out that to be better off than they are under the current system Social Security beneficiaries need  high yielding investments and that any year where yields didn’t exceed  3% after inflation and costs would leave someone worse off.  In an earlier column (1 February 2005) he remarked that to gain the benefits the Bush administration was promising the market would have to produce dot com boom type returns. Krugman got an independent calculation of what P/E’s might look like over 75 years to generate the returns required and came up with 70 for 2050 and 100 for 2060.

Krugman also says the new system, in effect, is a giant form of margin-lending – thus potentially great for leverage but not necessarily the optimal form of retirement planning.

How all that is going to be achieved when economic growth (according to the “crisis” case)  is only going to be 1.9 per cent a year, and productivity is falling, is obviously a faith-based, rather than a reality-based, question. But then this is an Administration which specialises in faith.

For Australians the debate is particularly apposite – what with impending super choice and a possible Future Fund. The same people who think Social Security privatisation is such a great thing are the same sort of people who think retail super funds and the Future Fund are good for Australia.

Oh what a lovely war!

Watch out if you are a single mum or a dole recipient and you breach a simple regulation or get a few dollars you shouldn’t. The penalties can be very significant.

But if you are a warrior – anything goes.

The Australian Defence Department can’t account for some $8 odd billion in spending and the Iraqi Provisional Authority can’t account for some $9 billion in spending.

In the latter case, however, one of the wonderful things about the Iraqi election is that the new government, from early noises, might try to find out where some of the billions spent have gone. They have got a running start on the US – as they already know that the Allawi government has proved to be one of the most corrupt in Middle Eastern history rather than a harbinger of liberty and democracy.

Déjà vu all over again again

The speed, and frequency, with which you get some emails is remarkable.

The latest to feature high on both speed and frequency was an extract from the New York Times of 3 September 1967 which said: “US officials were surprised and heartened today at the size of the turnout in South Vietnam’s presidential election despite a Vietcong terrorist campaign to disrupt the voting. According to reports from Saigon, 83 per cent of the 5.85 million registered voters cast their ballots yesterday. Many of them risked reprisals threatened by the Vietcong…..A successful election has long been seen as the keystone in President Johnson’s policy of encouraging the growth of constitutional processes in South Vietnam…..The purpose of the voting was to give legitimacy to the Saigon Government.”

It’s also already starting to feature on various articles and rebuttals of articles in the US and Australian media.

The UN and sanctions-busting

The Financial Times continues its exposure of US hypocrisy over the UN’s performance on Saddam’s oil smuggling.

On 19 January this year the ongoing FT investigation of US knowledge of, and complicity in, smuggling produced some State Department documents from 1998 and 2002 (both Clinton and George W. admininstrations if your chronology is shaky) which make it even clearer that the US knew of, and approved, Iraqi smuggling of oil to Turkey and Jordan.

Charles Duelfer, head of the Iraq Survey Group, couldn’t find any WMD but he did find that Iraqi smuggling to neighbouring countries was the largest source of revenue for the Saddam regime.

So – if you want a potted history of US and UK involvement with Iraq over the past two decades it goes like this: you arm the guy with chemical and other weapons; encourage him to fight a war with a neighbour you don’t like either; then you invade his country when he tries it on another neighbour; then you bomb him while simultaneously encouraging and approving smuggling and UN-sanctions busting which keeps his regime afloat; and, then you invade him again.

Are we completely sure that it was Saddam and not some others who were madmen?

The Griffith Review

One of the best periodicals in Australia at present is the Griffith Review edited by Julianne Schultz.

The latest issue is on The Lure of Fundamentalism and contains some great essays on the rise and risks of fundamentalism. Murray Sayle recounts his war correspondent days in the Middle East and includes some wonderful anecdotes about the wise and brave Moshe Dayan and his observations on the implications of the 1967 War. Bill Bowtell looks at some of the results of faith-based approaches to sex education pointing out that US HIV/Aids infection rates are 10 times those in Australia. Creed O’Hanlon recounts how teenage pregnancy rates in the US Bible-belt are among the highest in the world. Margot O’Neill describes how Australia ignored the advice and warnings from the former US Ambassador to Indonesia, Robert Gelbard, about the risks of fundamentalist terrorist acts in Indonesia. Lee Kofman examines the newfound interest in Kabbalistic practices (not only by Madonna) and remarks: “there are so many parallels between the Kabbalah, Hinduism and Buddhism – the cornerstones of the New Age – that the more appropriate question (about why it’s popular) is: why has it taken New Agers so long to rediscover it?”

Subscriptions are available through the website: www.griffith.edu.au/griffithreview