This was published 5 years ago
Opinion
Australia has much to celebrate - and to fear
Peter Hartcher
Political and international editorAn acquaintance was walking his dog along the promenade at Sydney's Manly beach one beautiful morning recently. He describes the golden sun sparkling on the waves, the mild breeze, the grace of the surfers, the people strolling and jogging, enjoying the early calm under the soaring Norfolk pines. He happened to pass one of the many park benches overlooking the ocean, where three older blokes sat contemplating the scene, pudgy hands clasped across substantial bellies. "Yeah," he overheard one of the sitters confirm to his companions, "this country's f---ed."
Australia is one of the most successful and attractive countries on earth. It also has a fair bit to worry about. A British magazine, The Economist, published a cover in October featuring a bounding kangaroo leaping into a clear, blue sky under the heading: "What the world can learn from Australia: It is perhaps the most successful rich economy."
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In the same month, the eminent policy thinker Ross Garnaut, former economic adviser to Bob Hawke, gave a speech to the Melbourne Institute where he began by dissenting from the theme he'd been invited to address, "Politicians delivering change." Garnaut's opening line: "I am not comfortable with the title of our session today. Australia is in trouble."
Could they be talking about the same country? Like the people in the scene on the beachfront promenade, they seem to be inhabiting parallel universe. Which is giving a true picture? The Western world broadly speaking, after the shock of the financial crisis of 2008, lost itself in self-loathing, inflicting self-harm, heedless of the cost. The polite name for this derangement is populism. A phenomenon with many definitions, the one I prefer is that populism is a belief in unworkably simplistic solutions to complex problems.
The UK is consumed in the project of making Little Britain even littler, otherwise known as Brexit. The US is so lost that its national leaders threaten each other with a "government shutdown", as we saw in this week's televised Oval Office standoff. Each side holding a gun to the head of a hostage nation. Once unheard of, this has become normal in Washington, government that agrees to fund itself for just a few months at a time, contingent on outlandish political demands.
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In the major powers of Europe, the political parties that dominated the postwar era are collapsing as voters move to the fringes in a frustrated search for elusive solutions. Germany's biggest political losers are the once-mighty Social Democrats and the Christian Democrats, the winners the far-right Alternative for Deutschland and the Greens.
Common to all is the fury vented on "the other". Immigrants and minorities, the more vulnerable the better, are scapegoated. It is a hatefulness and divisiveness unseen in the developed countries since the previous big economic shock, the Great Depression, gave rise to the fascism plunged the planet into into World War Two. The major eastern outpost of the West, Japan, is not roiled in a populist rage. Without any immigrants to scapegoat, the Japanese have chosen the slow extinction of their race instead.
Now compare this to Australia. "I don't think Australians fully understand what you have achieved here," said Ketan Patel, a British investor who has the distinction of having advised both China's Xi Jinping and India's Narendra Modi on economic policy. "It is astonishing." The way The Economist sees it: "Rising incomes, low public debt, an affordable welfare state, popular support for mass immigration and a broad consensus on the policies underpinning these things - that is a distant dream in most rich countries. Many Western politicians could scarcely imagine a place that combined them all. Happily, they do not have to, because such a country already exists: Australia."
Of course, Australia has no shortage of problems. But name just about any problem you like, and it's a great deal less worse than it is anywhere else. Australians fret about every one of the points on The Economist's checklist - incomes aren't rising fast enough, public debt is still too high, and so on - but by comparison Australia is in an enviable position. Australia, together with only Canada among the developed nations, avoided the global financial crisis. Australia has gone on to achieve 27 years of uninterrupted growth, a record for any developed nation. Taken for granted here, it is a source of amazement everywhere else.
This helps explain the other outstanding achievement of contemporary Australia. Despite all the sound and fury, in Australia the centre has held. While the political centre has shattered elsewhere, here it largely remains in tact.
Three quick examples. On the most explosive question in the world today, immigration, Australia is holding steady. There has been a crescendo of demands that the intake be cut. The calls are mostly from the fringes of left and right, and even occasionally from the centre thanks to NSW Premier Gladys Berejiklian. But this week's meeting of all leaders state and federal, in the Council of Australian Governments, reinforced the commitment to keep broadly to the status quo. Other states are pleading for more immigrants. Some headlines emphasised that Prime Minister Scott Morrison wants to cut the upper limit, the "cap", on new permanent residents from 190,000 to 160,000. This is an attack on the intake, we're told. Not so. If the cap falls to 160,000, it would be merely moving into alignment with the reality of the latest actual intake. And any number near this range is at the upper end of Australia's experience in recent decades. The Financial Review headline caught the essence: "PM backs big Australia." Morrison this week declared Australia to be "the most successful immigration country in the world", a variation on Malcolm Turnbull's theme of Australia as "the most successful multicultural society in the world". Both are correct. Fully half of Australia's population comprises immigrants, or the children of immigrants. This is double the proportion of the US, and achieved with far greater social cohesion than the US.
Second is one of the quietest yet most consequential achievements of this Parliament. The Labor and Liberal parties came together to defend Australia against the uniquely difficult challenge of Chinese Communist Party intrusion into Australia's vital organs. It's uniquely difficult because the Chinese Communist Party's structure is unique. It is not a normal nation state governed by a particular political party. It is a seamlessly integrated party-state which also owns and operates the army as a party organ. Under Xi the party has also further penetrated corporations, private and public, foreign and domestic, that operate in China. Even foreign firms now must have an internal formal Communist Party committee. Both of Australia's major parties rose to the occasion in supporting the foreign interference laws which took effect on Monday this week. This is seen as a model in other Western nations. And, long overdue, the two parties finally agreed to ban foreign political donations. It's remarkable that they were ever legal.
Australia is a an immigration success story.Credit: Luis Ascui
Third is debt. Most of the world is addicted to it. The US and China are among the worst offenders, eating their futures to feed the insatiable needs of the present. The US government is about to post annual deficits of a trillion dollars a year or nearly 5 per cent of GDP, extending into perpetuity: "Never in modern US history have deficits been so high outside of a war or recession," bewailed the Committee for a Responsible Budget this week. By contrast, Australia nursed a bipartisan consensus to restore the federal budget to surplus. Yes, actually achieving this has been long fumbled, but it's now on the brink of becoming reality, as Treasurer Josh Frydenberg will affirm on Monday. And this has been accomplished even as Australia has delivered new categories of social benefits such as paid parental leave and the National Disability Insurance Scheme, both Labor policies endorsed by the Liberals.
You could see the political centre at work again this week when the Coalition finally agreed to a national anti-corruption commission. Most of the coverage of this announcement missed the point, delving into design details. The government's specific proposal will never be delivered. Even if it has time to put the plan to Parliament, it will be subject to extensive negotiation. The point is that all the parties have now agreed. The politics has reached a consensus. Australia will finally get a federal Independent Commission Against Corruption.
Then Prime Minister Julia Gillard shares a laugh with Lynne Foreman as the NDIS takes shape. Both parties signed up to the social initiative.Credit: Jason South
So what is Garnaut so worried about? He's worried about the big and rising dangers now loose in the wider world, "more complex and dangerous than in my conscious lifetime". He's worried about economic vulnerabilities. He's worried about the rising denial of science and facts, most evident in Australia's failure to produce a cohesive energy and carbon emissions policy. And he worries that "we have seen monopolies and rent expand in our economy, feeding back into the political system as vested interests’ dominance over the public interest", exercising a veto on reform. "Most importantly," said Garnaut, "we have endured a thinning of an informed, engaged, independent centre of our polity". The centre has held; Ross Garnaut worries that it is fraying dangerously thin.
He's right. The two major parties that hold the centre together are already living on borrowed time. Australians are so disgusted at the self-indulgence of the Liberal and Labor parties that they crave alternatives. It's sheer luck for the established, big parties that each of the rising new parties has collapsed under the weight of its own incompetence, one after another. Australia has much to celebrate today, and much to worry about tomorrow.
Peter Hartcher is political editor.