Howard, Price and Forgetting

It was always going to be the case that an unsuccessful outcome from the proposal to give indigenous Australians recognition in the constitution in the way they requested, the Voice, would be interpreted as if the question was more than just that.

The Guardian tells us that John Howard is the latest. Speaking to a new right-wing group - the Alliance for Responsible Citizenship (Arc) - Howard described the no vote as "a stonking endorsement of how united we are". This is, of course, a nonsense...just as the claim that the proposal itself was "divisive". 

The Australian population is not uniform in any way. As libertarians would otherwise be at pains to establish we are all different. We will coalesce around issues or attitudes from time to time. 

But the most egregious of Howard's comments is his confession about his attitude to multiculturalism. He says:

Multiculturalism is a concept that I’ve always had trouble with. I take the view that if people want to emigrate to a country, then they adopt the values and practices of that country. And in return they’re entitled to have the host citizenry respect their culture without trying to create some kind of federation of tribes and culture – you get into terrible trouble with that.

This is unsurprising from Howard; but it is duplicitous on a number of fronts. 

The first, of course, is that the idea of the new arrivals assimilating to the "values and practices" of the country to which they emigrated only applies to people who emigrated some time well after 1788. That clearly delineates the "colonisers" as invaders and conquerors, which invalidates all the rest of the claptrap. 

The second is that Howard, whose credentials on immigration were first founded on opposing further Asian immigration, in government oversaw the greatest increase in Asian immigration in our history.

But the greatest opprobrium has to remain with Senator Nampijinpa Price. She told the conference:

The way forward from here is no more separatism, no more dividing us along the lines of race, no more political correctness, no more identity politics.

And yet, on 17 October she moved in the Senate:

That, in the opinion of the Senate, the following is a matter of urgency:

The need for Prime Minister Albanese to support the Opposition's call for a Royal Commission into child sexual abuse in Indigenous communities, audit spending on Indigenous programs, and support practical policy ideas to improve the lives of Indigenous Australians to help Close the Gap.

How on the one hand you can claim that there is to be no more dividing on race and on the other introduce a motion whose first limb is restricted to race has only one explanation: this is the moral code of the modern right. At its core is the conundrum of wanting less government involvement in our lives and at the same time strong policing presence. The right is horrified about legislation regulating misinformation, but insists on dictating the curriculum in schools exclude issues of genuine concern to youth.

At its extreme the right preaches libertarianism but rails against the "politics of identity". What the right preaches most is forgetting. Forget the inconsistency between the need for migrants to assimilate and the opposite approach taken by the colonisers who set out to extinguish the pre-existing culture. Forget that we just campaigned that the Voice was about division when we ask for practical policy to close the gap. Forget that conservatives are mostly defending the rights and institutions that previous generations of progrssives procured. 

Footnote: I dislike in general the use of the terms "left" and "right" to describe a near homogonous body of political action. I make an exception at times for the right when the messages are being organised through part of the great network of new right "mouthpiece" structures. That includes the conservative congference in Australia and now Arc.

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Life is what happens while you are busy making other plans JWL

Financability and network infrastructure

The energy transition requires new electricity generation to replace the fossil fuel fleet (mostly coal in Australia) and meet growing demand arising from the electrification of the transportation and heating sectors. AEMO's modelling calls for significant new transmission assets to connect this generation, though some (including me) think AEMO is underestimating the potential for distribution connected generation to meet more of the needs.

The plans to build massive new transmission assets raises questions of financeability; will anyone be prepared to invest in or lend to the operators the funds required to make these investments. The AEMC is currently considering one rule change request from the Australian Energy Minister on financeability, and another from the same source on how to accountfor concessional finance (the Rewiring the Nation funds) in the regulatory framework. Energy Networks Australia has submitted an alternative rule change on financeability. 

These concerns raise important questions beyond the simple issues inherent in their substance. The Australian Government's proposals for market reform in electricity focussed on the creation of a single national grid under government ownership that would enable the operation of competition in generation (see my chapter A History of Electricity Reform in Guillaume Roger's On the Grid).  The reforms did not follow this path with separate state based transmission networks being separated from generation and the NEM actually operating as a set of five inter-connected markets. 

Privatisation was not a high priority of the Australian Government in this reform. It was aggressively pursued by South Australia and Victoria in the face of fiscal pressure arising from the boom and bust of the late 1980s and early 90s. Privatisation was only recently pursued in NSW (byway of 99 year lease). Part of the promise of privatisation was to avoid the issues of the need to call on government to finance growth; and yet now that growth finally arrives we question the ability of private capital to fund it.

Ultimately the financeability questions really should have us examining the wisdom of privatisation, especially of the structurally separated market platform - transmission. 

A more challenging threat to the the record of privatisation has emerged in the UK in the water sector. The challenge there is led by Thames Water. The current headline is their ability (or inability) to raise the capital (10 billion pounds) necessary to meet operating standards. How they have got themselves into the mess is a combination of regulatory failure, investor greed and new investor stupidity.

Starting with regulatory failure, the UK water sector was initially regulated under the RPI-X model, before its mofification to the RAB model in the face of concerns that pure RPI-X might erode financability. The RAB model guarantees the operator an NPV>0 outcome - they will get investment fully repaid with a return on capital. It also includes incentive components allowing the operator to retain some of the benefits of cost saving as (economic) profit. However it has clearly done so without prohibitting cost reduction to occur at the expense of service quality. 

The beneficiary of this weak regulation was the owner of Thames Water from 2006 to 2017 - Australia's Macquarie Bank. As well as extracting profit from reducing cost at the expense of service quality, Macquarie loaded the businesses with debt (they changed the gearing ratio). If I load a business with extra debt I can return shareholder equity as special dividends. These were the greedy investors.

The stupid investors are those who bought the business from Macquarie. They haven't been able to generate any returns and inherit the problems of running down service quality. A challenge for regulators is that the service quality impact of underinvestment are only apparent some years after the investment falls away. 

One of the reasons for the failure of privatisation was that Governments didn't sufficiently understand the difference between privatising as listed entities and privatising through private investment. A lot of the theory of the efficiency of private investment hinges on the shareholder capital model. The benefit is three fold. The first is the requisite public reporting required of listed businesses and the resulting scrutiny applied by financial analystys. The second is the daily evaluation of company performance by the market. A focus on short term returns may be (is) destructive, but limitting market transactions to turnover measured in decades simply results in avoided scrutiny. And when these transactions do occur they are made by businesses accessing confidential data being advised by merchant bankers whose incentive is for the transaction to occur - it is a recipe for purchasers always over paying. The third is genuine competition, the framework of private ownership by big super funds or by big infrastructure players (thinking Ontario Teachers and Hutchisom Whompoa as examples of each) results in all the businesses globally having similar strategies and tacit collusion, especially in their regulatory engagement.

Having listed entities solves many problems. The financeability question can be resolved by simply creating a pricing outcome of how much new equity investors require to support the new project. The performance question is resolved by the greater transparency applied through market listing.

It is probably too late to reverse the privatisations, but we should cettainly do no more (e.g. the NBN). It isn't too late to institute licence conditions that require a proportion of the equity capital of these businesses to be listed, limits on the shareholding by related parties of the listed stock, and boundaries on gearing. The businesses will all no doubt cry blue murder about government interference in areas that should be decisions of investors and management. The simple counter is that the buisinesses only exist courtesy of a goverment licence for monopoly. 

I hold no hope that any policy maker will have the courage to pursue this essential reform. But that is a different problem.

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Life is what happens while you are busy making other plans JWL

That Hawke quote

As the public consideration of how to vote in the forthcoming referendum on the Voice, the No campaign has latched onto a quote from Bob Hawke that reads:

We are, and essentially we remain, a nation of immigrants a nation drawn from 130 nationalities in Australia there is no hierarchy of descent: there must be no privilege of origin. The commitment is all. The commitment to Australia is the only thing needful to be a true Australian.

This quote is drawn from Hawke's speech to the Federation of Ethnic Communities Councils in November 1988. Hawke refers to it as a quote from his launch of Australia Day celebrations that year, however, I have not been able to find that speech.

The reason Hawke referred to the quote in the latter speech wasn't just that he was addressing the Ethnic Communities Council, but, as he says, because of the development of the "One Australia" policy by John Howard. Hawke introduces his reference to that policy by saying that his one regret from the Bicentenniel year had been "the collapse of bipartisan support for the principles of multiculturalism and of a truly non-discriminatory immigration policy." 

He made the context of his remarks clear by referring to a resolution proposed by Hawke and  the House of Representatives gave "its unambiguous and unqualified commitment to the principle that, whatever criteria are applied by Australian Governments in exercising their sovereign right to determine the composition of the immigration intake, race or ethnic origin shall never, explicitly or implicitly, be among them."

The policy Howard espoused had been kicked off in August of that year in a radio interview which Hawke reports as:

Back in August, he was explicit. Asked about the rate of Asian immigration, he said: "I wouldn't like to see it greater... I do believe that in the eyes of some in the community, it's too great, it would be in our immediate term interest and supportive of social cohesion if it were slowed down a little, so that the capacity of the community to absorb was greater."

So there is no doubt at all that the context of Hawke's remarks was about the equality of all the migrants to the country, starting with those who arrived on the First Fleet. It was not a reference to the descendents of the original inhabitants.

Hawke's distinction with respect to Aboriginal Affairs was made clear in an earlier speech to the "Terra Australis to Australia" conference in August of that year. Early in his remarks Hawke noted:

As a nation we have come to accept that all Australians whether Aboriginal Australians, descendants of the First Fleeters, or new arrivals have a right, within the law, to develop their cultures and to contribute them to the wider Australian society. 

It is regrettable, but broadly true, that each group of new arrivals in Australia has been greeted by predictions that they will never be successfully integrated into the Australian community. 

But the reality of the Australian experience is that each group of new arrivals has successfully defied those predictions. 

Their success is an essentially Australian one.

Of course, Hawke overlooked the fact that uniquely one group of arrivals was never expected to assimilate, that being the British colonisers and the convists they forced here. 

Later in his speech he turned his attention to the then very recent fracturing of bipartisanship on immigration. He noted:

The Opposition leader has explicitly called for a slow down in the rate of Asian immigration. He refused to associate himself with the Bicentennial Multicultural Foundation because of the word "multicultural". 

He patronised ethnic communities and effectively encouraged the creation of ethnic enclaves by allowing as he put it "the right of people of say, Greek descent to preserve Greek customs and Greek language within their own family." I emphasise "within their own family" as though to speak a language other than English on the streets, to dance something more exotic than the quick step, was unacceptable. 

The National Party leader has said explicitly: "Asian immigration has to be slowed," because there are "too many Asians coming into Australia." 

The Nationals' Senate leader has called euphemistically for bringing the immigration stream "back into better balance" which means reducing the "excessively high proportion of immigrants from Asia".

In describing Howard's "One Australia" policy Hawke further noted:

It is based upon the belief that all Australians have to conform to one set of unchanging attitudes; it doubts the commitment of immigrants to this country; and it implies that certain Australians, by reason of race or ethnic origin, are less able to integrate into Australian society. In a recent speech, Mr Howard extended his "one Australia" slogan to cover other issues issues of industrial relations, equality of opportunity and Aboriginal Affairs.

Unfortunately I don't know what speech Hawke is referring to. However, it is very clear from the context that Hawke was explicitrly rejecting the Howard notion that Australia needed to be inherently mono-cultural and that this included aboriginal Australians.

In contrast to the misinterpretation of Hawke's comments about immigration, we should examine in more detail his policies in Aboriginal Affairs. First and foremost was his expressed intention to enter into a treaty by the end of 1990. This intention was built on the back of the Barunga Statement. One of the requests (demands) of the statement was for "A national elected Aboriginal and Islander organisation to oversee Aboriginal and Islander affairs." Hawke gave effect to his commitment to this part of the statement by passing the Aboriginal and Torres Strait Islander Commission Act 1989 (the ATSIC Act), which was the basis for ATSIC formed in 1990.

Hawke's commitment to treaty floundered on entrenched opposition from the LNP and for some in his own party. 

ATSIC was abolished in 2005 by John Howard. This followed controversy around the particular person chairing ATSIC, though a formal review of ATSIC recommended reforms not abolition. The path to abolition was opened when Mark Latham became leader of the ALP. As we have subsequently discovered, Latham was a throwback to the racist ALP at the start of the twentieth century.

Had Bob Hawke had the foresight to realise that subsequent LNP governments would dismantle ATSIC, or had he been requested to establish a First Nations Voice in the Constitution, what does his conduct suggest he would do?

Very simple - Bob Hawke would have backed constitutional change. 

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Vote YES

Dutton and the Voice

Peter Dutton's first response to the proposed Voice was to ask how it would make the children subject to sexual violence safer.

His argument for supporting the No case is that a national voice will achieve nothing, instead proposing regional and local voices and a mere symbolic constitutional recognition.  

Today he visited Alice Springs and met with his own Senator Price and one shopkeeper. He didn't meet with local indigenous groups saying "I'll let those organisations speak for themselves". In other words, they can be voices, but he won't listen to them.

Price is a bundle of contradictions, being a Liberal because she opposes government involvement in people's lives but being a proponent of extreme involvement (cashless debit cards alcohol bans) for her own people.

Let' just put this all in context. The Uluru statelent from the heart was the endpoint of a proposal for constitutional recognition that dates back to John Howard. That proposal was the same kind of smbolic recognition Dutts favours.

But when First Nations got asked what they wanted, a long process, including what was technically a Constitutional Convention at Uluru, said recognitioon without understanding was pointless. First Nations wanted a Voice to be followed by truth-telling and treaty.

For anyone still confused about "truth" just read the sections of the UK Parliament "Parliamentary Select Committee on Aboriginal Tribes" report of 1837 that address Australia and the Pacific Islands. 

A whole lot of guff gets talked about under "sovereignty" - and the sovereign citizens show you how much is rubbish. That Australia was and always will be aboriginal land is anexpression of the cultural connection, not about a claim to governance. Inddeed, placing so much importance on the Voice being included in the Constitution is an embrace of oiur democratic forms.

The only people who have anything to fear from the Voice are people like Dutton who don't want to hear from First Nations people as organised representative bodies. They may pick and choose and find a few individiuals - a Price or a Mundine - but will be rejected by those who were formally their own like Ken Wyatt.

Dutton isn't just playing politics and seeking to differentiate himself from Labor. He isn't just trying to hold what's left of the Liberal Party together. He is simply opposed to the idea of listening to First Nations people because they don't deserve to be listened to. There is a label for that!

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Life is what happens while you are busy making other plans JWL