The pursuit of economic growth

The financial crisis must be over.

Whenever the economy crashes, wise men and women say we need governments to manage the financial world for everybody’s benefit. Capitalism, left by its lonesome, can’t make everybody rich.

But when the economy is growing, those sages complain that being rich is no good anyway.

Take one of the keynote speakers for this year’s Alfred Deakin lecture series. Tim Jackson, a professor of sustainable development and author of Prosperity without Growth?, claims that the era of economic growth is over. Jackson writes: “Questioning growth is deemed to be the act of lunatics, idealists and revolutionaries. But question it we must.”

Sounds brave.

French President Nicolas Sarkozy wants nations to abandon their “fetishism” for growing their gross domestic product (perhaps easy to say if you’re the president of a country whose economy has had a sluggish few decades). And luminaries like Nobel Prize winning economist Joseph Stiglitz also believe we have to drop growth and focus on well-being.

This message has its appeal. There is only so much coal, copper, tin, iron and uranium buried in the ground. We’re richer, but we seem more stressed. We have more choices, but they’re complicated and confusing choices. We have better hospitals, but we have fatter stomachs too. And then there’s the environment.

Nevertheless, the growth sceptics couldn’t be more wrong.

We can mock all the trivial inventions and gadgets which make up modern life. (Although I believe the invention of the flat-bottomed taco shell is a worthwhile innovation.) But economic growth is about more than iPads and tooth-whitening solutions.

Growing richer means getting healthier. People in wealthy countries live longer – this graph, which compares GDP per capita with life expectancy demonstrates that clearly enough.

In the first world, only steadily-increasing personal wealth will make expensive health technologies affordable. In the third world, basic public health requires strong economies. To eradicate malaria you have to drain swamps. It’s expensive.

Then the big one: a wealthy country is a clean country. That’s counterintuitive, sure. But the same policy settings which fuel economic growth – property rights, individual liberty, and the rule of law – are a powerful incentive to protect the environment. The drive for wealth involves the drive for competitive efficiency. There is nothing less efficient than waste and pollution.

Electricity generators in the first world are cleaner than those in the third. Priuses cost money.

And it is only desire for profit which leads entrepreneurs to develop and commercialise green technology. If we powered down to a motionless “stable” economy, as growth sceptics believe we should, we’d be discarding our biggest incentive to invent green things.

Yes, many natural resources are limited, but our capacity to innovate – given the incentive to profit – is unlimited. The economist Julian Simon wrote a book called the Ultimate Resource. He was referring to humanity’s ability to adapt to changes and invent new ways of doing things.

We’ve all heard the trite quip the Stone Age didn’t end because we ran out of stone. But we’ve been abandoning finite resources in more recent times. We used to light our homes with whale oil and heat our homes with Europe’s ancient forests. Now trees are mostly farmed in plantations and whales are only used for scientific purposes (I’m sure).

In Prosperity without Growth? Jackson writes economic growth has “failed the two billion people who still live on less than $2 a day”. This is tragic. But it’s still an improvement on past performance. The developing world might be poor, but it’s wealthier than it was. And healthier. With good governance, stable legal systems, and secure property rights regimes, there is no reason to believe the poorest parts of Africa and Asia couldn’t be future boom economies.

Those countries will need that economic growth if they are to adapt to natural and unnatural climate change.

It is fantasy to believe through careful planning and clever coordination we could get the inestimable benefits of economic growth without having the growth itself.

And it’s a weird sort of hubris to imagine we are the generation who will see the multi-millennia project of economic growth suddenly stop.

We want growth because we want our children to live better than we do – to be richer, with all the health, education, and lifestyle benefits wealth can bring. We want the poorest members of our society to be richer than we are now. We want the developing world to be infinitely richer. We want the Bangladeshis of tomorrow to be twice as rich as the Australians of today.

To pursue economic growth is to believe progress – better living standards, better health, and a better environment – is possible.

Chris Berg is a research fellow with the Institute of Public Affairs and editor of the IPA Review. You can follow Chris Berg on Twitter.

It’s alive, after a fashion

Tony Abbott is a strange person to run an anti-tax, anti-spending election campaign. Sure, Abbott got the leadership on the back of a simple phrase – ”great big new tax” – liberally applied to the government’s emissions trading scheme. He’s picked up Malcolm Turnbull’s theme of careless waste in education and insulation, and run with it hard.

His budget reply speech in May sung loudly with ”this reckless spending must stop”.

But it was quickly revealed that the night before his reply Abbott had asked his shadow cabinet to approve a pretty reckless piece of spending of his own: a quick cash payment of $10,000 for stay-at-home mothers. This idea was quickly shut down by his colleagues.

That was to be on top of the opposition’s proposed paid parental leave scheme, which had been announced in March, supported by a $2.7 billion tax imposed on businesses. It would give Australia parental leave to rival Sweden’s.

(As an aside, for decades we’ve been told Australia should be like Scandinavia. So why Abbott’s policy has been so enthusiastically laughed at by those who believe we should be playing policy one-upmanship with Pippi Longstocking is beyond me.)

Anyway, now the opposition is back condemning great big new taxes. Abbott claims increasing the tax paid by the mining industry would be like digging out the heart of the economy and sending it, still beating, to Guangdong Province to work the rest of its life making iPad knock-offs.

Putting aside the merits (and demerits) of the mining tax, there’s a reason for this barrage of mixed messages.

It’s that Abbott’s small government identity doesn’t quite fit him properly.

One of the most common claims made about the Opposition Leader is that his ideas are little more than nostalgia for John Howard – to elect Abbott is to give Lazarus another triple bypass. It’s an understandable view. When in 2003 he was asked if he could think of anything he disagreed with Howard on, Abbott responded: ”No. No. I can’t.”

But Abbott isn’t exactly Howard. Abbott represents strongly just one side of the Howard legacy, a side that became more and more dominant as the Howard government got longer in the tooth – big government conservatism.

That’s the best description of the Howard government’s mix of modest social conservatism and giving the middle-class as much welfare as they can stomach.

Howard was much more like a progressive leftie than anybody gives him credit for.

Under Howard, the rich got taxed more, and the poor got taxed less. In 1996, the top 25 per cent of income earners paid 60 per cent of the Commonwealth’s total tax revenue. By 2007, they were paying 67 per cent. That’s a big increase.

On the other side of the city, the bottom 25 per cent of earners were paying 3.4 per cent of the total revenue in 1996. Eleven years later, that number had dropped to 2.5 per cent.

Yet Howard had made his way in the 1980s as an economic dry. He was supported by the rump of free marketeers in the Liberal Party who believed Australia needed to privatise the big, lumbering bureaucrat-run businesses, deregulate and destroy the cosy government cartels (the government’s official Egg Marketing Board, for instance), lower taxes, cut spending and generally get off the economy’s back.

Let’s just call them neo-liberals. Everybody else does.

In government, Howard spent heavily and regulated heavily, but he did come good on some of the neo-liberal agenda. Telstra was fully sold, the GST implemented, media markets deregulated, and so on. Small steps, but enough of them to keep the free marketeers on side. Howard still got to call himself a neo-liberal, and everybody else got to damn him as one.

Howard was a neo-liberal on Mondays, Wednesdays and Fridays, and a big government conservative on Tuesdays, Thursdays and Saturdays.

Neo-liberalism in Australia is primarily an economic agenda. And Abbott’s lack of interest in economics is famous: ”I have never been as excited about economics as some of my colleagues; you know, I find economics is not for nothing known as the dismal science.”

Much more than Howard, Abbott sees the economy as simply an engine to produce money for governments to spend. A good economy is important. But mainly so governments can fund social programs: ”You can’t run a decent society without a strong economic base.” The word ”run” is crucial. That’s hardly a vision of a neo-liberal, dry-as-dust, no-such-thing-as-society Brutopia.

All signals suggest an Abbott government would continue to bump up taxes in order to fund lavish subsidies to the middle class. Like Howard.

But unlike Howard, Abbott’s interest in neo-liberal reform seems limited to WorkChoices.

So there was considerable disquiet within the Liberal Party when the parental leave scheme was announced. Not just with the way it was announced, but the very idea of levying a big new tax on business.

Former treasurer Peter Costello wrote in The Age: ”I have been to a lot of Liberal Party meetings in my life and I can honestly say I have never heard a speech in favour of higher tax.”

After all, many in the party still harbour an intuitive resistance to tax increases, let alone whole new taxes. Howard and Costello knew what they were doing. Their later budgets invariably had some sort of tax cut, no matter how piddly or token.

Any leader will do if you’re winning. (That’s politics. If you’re losing, no leader is good enough.) The Opposition Leader has made big gains. But iron-man Abbott will have to work out harder if he’s going to fit into the clothes of an anti-tax, anti-waste warrior.

Capping trade

Last week’s Freedom Flotilla incident has highlighted an old truth. Trade – or, in this case, the forced closure of trade – is an ineffective foreign policy tool.

The blockade of Gaza by Egypt and Israel is actually a massive trade and travel embargo.

Humanitarian supplies can be legally brought into Gaza, but also much more than that: frozen salmon and low-fat yoghurt can come in too. Coriander, margarine and A4 paper cannot. Wood for doors or window frames, yes. Wood for construction, no. The list seems completely arbitrary. Hillary Clinton had to personally intervene to have dried pasta allowed in.

That’s because Egypt and Israel don’t just want to force the end of weapons smuggling. They want the trade embargo to undermine Hamas’ support in Gaza. One Egyptian politician said “Egypt will not accept the establishment of an Islamic emirate along [its] eastern border.”

Gaza under Hamas is a rogue state.

That’s a regional problem, not just an Israeli one.

Since coming to power, Hamas has led brutal attacks on opponents and civil society organisations. In the days after the Freedom Flotilla, Hamas security forces raided six NGOs in Gaza. Thuggish political violence and repression is an essential part of Hamas’ program.

And despite the blockade, with Hamas acting as an Iranian proxy, they seem to be having no problem getting weapons.

That shouldn’t come as a surprise. There have been few occasions when trade embargos have succeeded. Embargos rarely hurt those in power, who have the money and the political means to acquire things others do not.

Fifty years of economic sanctions have utterly failed to budge the Castro regime in Cuba.

And worse, they’ve given the Cuban dictatorship an easy excuse for its own failures. Directing domestic attention towards the American trade embargo is simpler than dealing with the deep economic problems caused by a half a century of socialism.

The same holds true for North Korea, where isolation from the world economy supports rather than challenges the regime. The state ideology of Juche – socialist autarky – is how the regime embraces this forced seclusion, and uses it to cement its control over the population. And, as in Cuba, the responsibility for North Korean poverty is levelled solely at the West.

Restrictions on trade with Iraq failed to topple Saddam Hussein. They were some of the toughest sanctions in history. Yet before 2003, the only major destabilisation of the Iraq government came from the bombing in 1998.

Trade embargoes have failed in Burma, Iran, Zimbabwe, and Syria.

A 2007 study of 204 separate economic sanctions over the last century found they were successful in achieving regime change in only 31 per cent of cases. Their success at disrupting military adventures was successful in just 19 per cent.

And they can have some terrible unintended consequences.

Certainly, humanitarian goods are getting into Gaza. But simply sustaining the population isn’t the main game.

The trade embargo stops Gazans from integrating themselves into the world economy. Their domestic economy is busted. It will remain busted as long as they are unable to trade. Imports to Gaza may be strictly limited, but exports from Gaza are effectively banned.

The Palestinian Trade Centre claims that, as a consequence, the number of private sector firms has shrunk at least 70%. In 2005, around 25,000 people were employed in Gaza’s clothing industry. That number is now around 230. Unemployment in Gaza is nearing 50 per cent. 80 per cent of the population relies on aid. Recent Iraqi history has taught us sudden mass unemployment is not a harbinger of peace.

There is little Israel and Egypt could do to divert hardline Hamas fighters from their path of violence. But the blockade could convince many Gazans there is no prospect for mutually beneficial cooperation with its neighbours – the sort of cooperation that open trade encourages.

The only peaceful future of the Middle East will be one with trade and economic cooperation.

History tells us the blockade is unlikely to budge their rule. Worse, it could legitimise it, in the minds of some Gazans.

That’s why what happened on the Freedom Flotilla has been such a massive win for Hamas. The blockade hides the extraordinary repressiveness of the ruling regime. Last week in Gaza there was a 2,000 person demonstration against new taxes being levied on smuggled commodities by Hamas. But the Freedom Flotilla turned the attention right back on Israel, inside and outside the Gaza strip.

And of course, Egypt’s role in the blockade has been popularly ignored.

Nations have an absolute right to defend themselves. Egypt and Israel are unquestionably justified in inspecting for weapons entering Gaza, and taking action against aggression. But rather than destabilising Hamas, the economic blockade might be only encouraging the violence.

Seeking a political crisis

“Stop the boats, we must” stated Tony Abbott last week, announcing the Coalition’s intention to bring back temporary protection visas for asylum seekers.

Must we? It’s not clear why. This has all the hallmarks of a concocted political crisis.

Certainly, 4,893 asylum seekers arrived by boat in 2009-10, a significant increase on the previous year’s 1,000 arrivals. According to the federal opposition that’s the most ever, higher than it was before the Howard government introduced temporary protection visas nearly a decade ago.

Sounds like a lot, unless you recall the federal opposition has also been claiming Australia currently has total net migration of 300,000 people per year. Or recall the fact that there are 50,000 people already in the country who have over-stayed their visas – as they are not seeking asylum, this is true ‘illegal immigration’. If we really want to secure our borders, we’ll have to eliminate tourist visas first.

It’s also worth noting the large number of boat arrivals to Australia in 2009-10 is not actually the largest influx in any 12-month period ever. If we measure by calendar years, rather than by financial years, 5,516 people arrived in 2001.

Accounting trickery, sure. But comparing calendar years is no more arbitrary than comparing financial years. Neither has our refugee program as a whole gotten out of control.

Australia’s humanitarian intake has remained stable for the last twenty years, teetering around 13,000 humanitarian visas granted per annum. Our intake has been much higher in the past. Under the Fraser government, this figure was well over 20,000.

We could easily take more. Expanding our immigration program is hands-down the best thing we could do to help the developing world. Migrants send money and skills back home. Allowing more people to move freely across national borders to work would be overwhelmingly more beneficial than anything we could do with foreign aid.

Anyway, the number of asylum seekers who come by boat is a tiny proportion of the masses of people who come through Australia every year. So while asylum seekers are a controversial political football, they are not a serious policy problem.

You wouldn’t know that from all the bellicose political rhetoric. After one boat tragically exploded in April last year, Kevin Rudd claimed “People smugglers are engaged in the world’s most evil trade and they should all rot in jail because they represent the absolute scum of the earth”.

The Prime Minister is becoming known for his hyperbole. But he misses the serious point. We mustn’t pretend trying to stop people from fleeing persecution is being compassionate.

Refugees are active participants in the choice to risk the long journey to Australia. Their decision to take the risk comes from their wish to escape and build a better life.

The dreadful risks of taking a boat to Australia are an indication of the desperation of the passengers, not of the depravity of those who they pay to help them. After all, the big disincentive to take the dangerous journey is the dangerous journey itself. Not the bureaucratic hurdles which the government throws in the asylum seekers’ way.

More than eighty per cent of boat arrivals to Australia this year have come from Afghanistan and Sri Lanka. Both countries have been in strife, and are nearby. It’s not just us: since 2008 the rest of the world has experienced substantial surges in Afghani and Sri Lankan refugees as well.

The opposition’s proposed reintroduction of temporary protection visas would do very little to alter the calculated risk asylum seekers make when they hop on the boats. But it could do considerable harm once those refugees arrive.

A source of much conservative and right-of-centre unease with refugee programs (and immigration programs in general) is that they can be a drain on the welfare system. They fear migrants often fail to integrate fully into the Australian economy; that they will not make productive members of society.

If anything, temporary protection visas would make this worse.

Refugees with temporary status are substantially less likely to find stable work than refugees with permanent status. Employers are understandably reluctant to hire and train someone whose residency is insecure.

And migrants left out of the workforce struggle to participate in Australian society. Indeed, as they may be unable to gain permanent residency once their temporary status has expired, refugees have less of an incentive to try. Learning English, for example, is a substantial investment. Refugees are less likely to make the investment if their residency could be revoked.

This should be as much a concern about Australia’s social cohesion as it is about the wellbeing of individual refugees. After all, we want refugees to join the Australian community. Making refugee status temporary – telling them their stay here is only provisional, or even transitory – does nothing but undermine their integration.

The ‘divine violence’ of Slavoj Zizek

Nearly half a century after 1968, Europe is again seized by sporadic outbursts of anarchic, seemingly-purposeless violence.

The extraordinary violence in Greece brought about by that country’s sovereign debt crisis is both unfocused and unjustifiable. In May, three people died, trapped in a bank that had been firebombed by rioters.

It’s been less than two years since the December 2008 Greek riots over the police shooting of a teenager, which also involved firebombs, the overturning of cars, the burning of hotels, shops and banks, and violent clashes with the police. Across the continent in France, torching cars has almost become a tradition in the Parisian banlieues. The strikes and protests over the French economic situation in January 2009 turned quickly violent. In Bulgaria, Latvia and Lithuania, there were 10,000 person strong mass protests over the economic climate-before the global financial crisis, mind you-and all have been characterised by violence.

According to Slavoj Zizek, the radical academy’s new superstar philosopher and cultural critic, that’s good violence. Or, more specifically, it’s ‘divine’.

Zizek is the next Noam Chomsky. He’s been a visiting professor at seemingly every top-tier university: Columbia, Princeton, Chicago, and New York. He’s the author of nearly 60 books, and the star of half a dozen fawning documentaries.

He is studied in symposiums at Melbourne University, in cultural studies and social theory subjects at Monash University, in film screenings at Sydney University, and in cinema studies at the University of Queensland. Zizek’s name pops up in The Canberra Times, The Sun Herald, and The Australian. He even made The Age’s ‘Green Guide’ TV supplement. He appeared last year at a Melbourne architecture conference, and has philosophy symposiums dedicated to his writing. Clive Hamilton, the former Greens celebrity candidate for Peter Costello’s former seat of Higgins, quoted him approvingly in a column earlier this year.

The Times Literary Supplement calls him ‘one of the most innovative and exciting contemporary thinkers of the left’. The Chronicle of Higher Education describes him as ‘The Elvis of Cultural Theory’, but his stage presence-with academic superstars it is fair to describe their performances-is more like Robin Williams with a thick Eastern European drawl.

Indeed, Zizek has a taste for the theatrical. His 2006 documentary where he applies psychoanalytic philosophy to popular movies titled A Pervert’s Guide to Cinema: ‘Cinema’, Zizek claims, ‘is the ultimate pervert art’. He has written introductions to collections of writings by Trotsky and Robespierre, including in both cases partial apologies for both the men and their methods. And the cover of a recent book, In Defence of Lost Causes, is illustrated with a picture of a guillotine.

Such publicity-consciousness has its rewards. The Slovenian psychoanalytic philosopher is as close to a cult figure as the academy’s post-modernist community can produce.

Zizek has a habit of throwing broad and shocking statements that slam down on the table, then quietly adding caveats, before finally and confidently arguing the opposite.

Good showmanship, sure, but it has a theoretical basis. Zizek is a follower of the French psychoanalyst Jacque Lacan, who was himself a follower of Freud. Zizek uses Lacan’s concepts of the Symbolic, the Real, and the Imaginary – they all require capitalisation – to describe, not things which are real, symbolic, or imaginary, but things which are true to themselves, or symbolic in the realm of pure language.

That’s only the half of it.

Lacanian psychoanalytic philosophy is infamously impenetrable. Alan Sheridan, who first translated Lacan into English described this lack of clarity as wilful. ‘Lacan,’ Sheridan argued, ‘doesn’t intend to be understood … He designs his seminars so that you can’t, in fact, grasp them.’

For all the complexity of postmodernism, when you read such post-modern luminaries such as Lacan, you can’t help but get a nagging feeling that it is an elaborate prank.

Zizek wears the clothes of postmodernism, and that parodic sensation is more overt. There is the same wordplay with jarringly capitalised adjectives, and reference to the ‘master-signifier’ pattern that controls history, but it feels like criticising Zziek does nothing more than broadcast that you have missed his joke. One could not describe the Disney movie Kung-Fu Panda as the best description of contemporary political ideology without some degree of ironic detachment.

Nevertheless, for all of Zizek’s movie analogies, his blurry theory and his post-modern theatricality, they have a largely simple message.

More openly than his academic rockstar predecessors Chomsky, Foucault and Sartre, Zizek is an unashamed and unremitting revolutionary Marxist. As Johann Hari wrote in the New Statesman in 2007, ‘When you peel back the patina of postmodernism, there is old-fashioned philo-tyrannical nonsense here.’

According to Zizek, capitalism is violence: ‘the self-propelling metaphysical dance of capital runs the show’, providing the ‘fundamental systemic violence of capitalism … this violence is no longer attributable to concrete individuals and their “evil” intentions, but is purely “objective”, systemic, and anonymous’.

The market economy may seem like a web of peaceful interactions for mutual benefit, but really it is supported by aggression and oppression. When the government of a nominally capitalist country goes to war, the marketplace is to blame.

The awful events that occurred in Abu Ghraib were not crimes, but manifestations of the American economic system: ‘Iraqi prisoners were effectively initiated into American culture’.

So, for Zizek, the clash between Islamist terrorism and the Western world is not a clash between barbarism and civilisation, but between two types of barbarism, ‘a clash between anonymous brutal torture and torture as a media spectacle’. Zizek’s 2009 book, First as Tragedy, Then as Farce, expands on this theme. The two big events of the first decade of the twenty-first century – the destruction of the Twin Towers, and the Global Financial Crisis – spell the end of the liberal order, destroyed once by the violence of radical Islam, and then again by the violence of the collapsing share market.

What is striking about Zizek’s argument so far is how common this view is.

Zizek is clearer than most, but the moral equivalence of capitalism and barbarism has been one of the radical left’s primary themes since well before September 2001. Michael Leunig wrote in The Age in March this year that ‘Our culture has thrived on the stabbing impulse … If schoolboys stopped being violent, the empire and the free market would surely crumble … Our unique brand of civilisation depends as much upon conflict and annihilation as it does upon co-operation.’

When we read that the ever-repeated claim that the Iraq War was a war for oil we are being told that maintaining the ‘system’ of trade and globalisation, by definition, requires the occasional violent invasion of other countries.

Never mind that a much cheaper way to acquire Iraqi oil would have been to do the capitalist thing and just buy it. The cost of the Iraq war is now well over one trillion dollars.

Still: in the minds of many in the radical left, warfare is not only a necessary condition for the existence of capitalism, but its most pertinent feature. Zizek and his co-ideologists use the literal violence of the wars in Afghanistan and Iraq, to damn what they imagine is the more perverse violence of the competitive marketplace.

These beliefs allow writers like John Pilger to claim, as he did in New Statesman in May, that the International Monetary Fund and ‘neoliberalism’ is an ‘occupying force’, writing that the Greek protestors ‘are clear who the enemy is and regard themselves as once again under foreign occupation. And once again, they are rising up, with courage.’

It is in those protests that Zizek detects ‘divine violence’. Divine violence is an act of violence not for revenge, or to achieve a political goal, but an act of violence so extreme that it upsets the fabric of the social order; terror deployed for political purpose, but with no political goals, outside the disestablishment of the status quo. The Terror of the French Revolution was divine violence-a radical break with the past-as the revolutionaries who rejected the social norms and habits of society.

It is only through extreme violence-which is gasping out in contemporary Europe-that the world can earn its redemption, and the break from capitalism can finally be made.

This distinction between violent acts and divinely violent acts is Zizek’s key to history, allowing him to dismiss the monsters he dislikes, and defend those whose aims he supports.

Adolf Hitler may have been a brute, but he was a brute in Zizek’s eyes, because his Holocaust was fundamentally conservative – it sought to defend a status quo rather than traumatise the world into a higher level. In Violence, Zizek writes:

If one means by violence of the basic social relations, then as crazy or tasteless as it may sound, the problem with historical monsters who slaughtered millions was that they were not violent enough.

In In Defence of Lost Causes, he writes:

… crazy, tasteless even, as it may sound, the problem with Hitler was that he was not violent enough, that his violence was not ‘essential’ enough. Nazism was not radical enough, it did not dare to disturb the basic structure of the modern capitalist social space (which is why it had to focus on destroying an invented external enemy, Jews).

… Hitler did not ‘have the courage’ to really change things; he did not really act, all his actions were fundamentally reactions, that is, he acted so that nothing would really change, he staged a great spectre of Revolution so that the capitalist order could survive.

This is, incidentally, a charge he apparently also lays at the feet of Pol Pot in his upcoming book, Living in the End Times – that Pot did not go ‘far enough’. (The moral contrast with John Pilger, who played the major role in exposing the murderous Pol Pot regime to the West, could not be stronger.)

To those who might object, Zizek quotes Robespierre’s denunciation of critics of divine violence who focus on the victims of terror: ‘A sensibility that wails almost exclusively over the enemies of liberty seems suspect to me. Stop shaking the tyrant’s bloody robe in my face, or I will believe that you wish to put Rome in chains.’

That, certainly, is the message sent by the anarchist faction of the Greek rioters, whose response to their government’s austerity measures was to murder three bank workers. Writing of the mob violence of Haiti under Jean-Bertrand Aristide, Zizek says:

Although we are dealing with what can only appear as ‘immoral’ acts of killing, one has no political right to condemn them, because they are a response to years, centuries even, of systematic state and economic violence and exploitation.

For those Greek rioters, this makes sense.

If James Bond is granted a licence to kill by the state, the mob is granted a licence to indiscriminate terror by Slavoj Zizek.

Privacy pose shows the minister is off his Facebook

It must have felt nice for Communications Minister Stephen Conroy not to be the bad guy. Just for a little while.At a Senate estimates hearing last week, being peppered by questions finding even more flaws in his internet filter plan, Conroy seized an opportunity to direct a bit of fury Google’s way. And at Facebook, too – the minister was on a roll.

Conroy accused Google of the ”largest privacy breach in history across Western democracies” for its apparently accidental sampling of publicly accessible data from home wireless internet networks. Then he claimed Facebook had ”gone rogue” because the social network’s privacy policy was getting increasingly complex and confused.

”What would you prefer?” asked Conroy. ”A corporate giant who is answerable to no one and motivated solely by profit making the rules … or a democratically elected government with all the checks and balances in place?”

Sure, Conroy’s sudden, passionate defence of the privacy of Australian Facebook profiles could be totally sincere. But recall this: he is a member of a government that is about to install body scanners in airports. Body scanners aren’t ”mistakes”, as Google described its inadvertent over-collection of data.

They’re designed to peek under clothes and investigate the nude contours of travellers. Some are able to capture and store images. Now that’s a privacy problem to be worried about.

At least when a corporation breaches privacy, it’s relatively easy to deal with.

If you don’t like Facebook’s privacy settings, you can, you know, quit Facebook. It’s not hard: it’s in the ”Account Settings” tab on the top right corner of the site. If enough people do, Facebook will have to reform its ways, or go out of business.

And if you don’t like that your wireless network is unsecured for Google or your neighbours to look at, secure it.

Most Australians now run high-powered wireless networks in their house and use them for online banking. Perhaps a few minutes thinking about network security wouldn’t go astray.

Certainly, Google should be chastened by its blunder. If they have broken any Australian laws, then they should be punished.

But when the government runs roughshod over our privacy, that’s much more serious.

As Conroy was launching into Facebook, a genuine threat to privacy was winding its way through Parliament – healthcare identifiers, which form part of the government’s electronic health records plan. If it passes, every Australian will be allocated a unique number, and encouraged to store their health records in a government database. No information is as sensitive as health records. And these records will be accessible to half a million healthcare workers around the country. Indeed, that’s the point.

Ensuring information security in high-stress environments (like emergency rooms) or in busy retail environments (like a Medicare outlet) is no small task. It’s easy for computers to remain unlocked, or logged-in, even if just for a short time. So it won’t take very long for a serious compromise of security to occur.

In general, eHealth is a good idea. But what the government proposes is a universal, compulsory, centrally managed and bureaucratically controlled record system. Individuals will have no direct control over their own records. (Unlike, for instance, the private online health record systems available from Microsoft and Google.)

The eHealth scheme is an Australia Card for your embarrassing bowel problem.

Privacy problems are endemic to centralised government systems: 1000 Medicare employees have been investigated for spying on personal information in the past three years alone. That’s one in six Medicare employees.

There are problems in Centrelink too. In 2006, after a two-year study, investigators uncovered 800 cases of illegal snooping by 100 staff.

Now CrimTrac, the federal agency in charge of criminal databases (fingerprints, DNA, and criminal records) wants to control data from law-abiding citizens too (drivers’ licences, birth registries and passport photos), all matched up to the electoral roll and collected on a nationally accessible police database.

The CrimTrac head, Ben McDevitt, claimed police ”need to have access to the sort of data that is held by various governments in order to establish an individual’s identity”. He said some privacy may have to be sacrificed for better law enforcement: ”I don’t find that at all threatening or big brotherish.” How reassuring.

Facebook has been deeply stupid – abusing the trust of users, continuously changing their privacy settings, and playing fast and loose with personal information. The company has long seemed dismissive of many privacy concerns and it deserves to be harangued by the press and punished by the marketplace.

But at least you can quit Facebook if you’re unhappy. If a government department abuses your trust or compromises your privacy, you can’t do anything.

Defence’s Spending Debacle

If you still have faith in the natural efficiency of government, there’s a quick way to eliminate that.

Read the first dozen pages of the Australian National Auditor Office’s report into the Defence Department’s Lightweight Torpedo Replacement Project, which was released last week.

In the mid-1990s, Defence decided it wanted a new anti-submarine torpedo that could be deployed on frigates, helicopters, and patrol aircraft. Phase 1 of this acquisition started in March 1998.

Twelve years and two months later, $391 million has been spent and there’s still no torpedo. The whole thing would be substantially over budget if they hadn’t eliminated three of the five platforms the torpedo was originally supposed to be deployed on.

In fact, the auditor general has now pointed out the torpedo will never do what the Defence Department wanted it to do.

The audit catalogues the project’s decade long history of poor planning, mismanagement, buck-passing, and careless decision-making. The Defence Department thought they were buying an off-the-shelf piece of equipment, already being used by other countries, but it took them “several years” to realise that was “not the case.”

Not a resounding success, then.

Certainly, some big government projects don’t function as advertised. The Rudd government has worked hard to remind us of that truism.

But the list of Defence projects that are over-budget and mishandled is pretty impressive.

The $16 billion F-35 Joint Strike Fighter is well on its way to becoming as iconic a debacle as the Collins class submarine. The Seasprite helicopter was cancelled in 2008, because it was already running seven years late, and we’d already spent $1 billion on it.

The Wedgetail airborne early warning program is four years overdue. The Tiger Armed Reconnaissance Helicopter: also four years overdue, and mired in contractual disputes.

The upgrade of the M113 armoured personnel carriers are three years overdue. The Auditor General found the M113 upgrade had been characterised by “poor project management practices; ineffective project planning; inadequately defined project objectives; and technical problems”.

Indeed, “poor” is a word commonly encountered in Defence audit reports. A report published in March covering explosives procurement documented poor budgeting practices, poor lines of responsibility, poor contract management, and poor project administration.

Even a new program designed to cut down on waste – a logistics information system to track Defence assets – has blown its budget by 20 per cent and delayed three years.

It’s almost as if Defence is constitutionally incapable of buying new stuff without being overcharged.

A McKinsey report earlier this year found Australia’s military spending was among the least efficient in the world. The consultancy compared the amount of money we spend with the amount of equipment we procure. In a list of 33 major countries, we tied with the United States for worst at getting value for our Defence dollar.

Part of the problem is politics drives procurement. Politicians want to buy Australian-made.

The McKinsey report noted those countries which tried to procure their equipment domestically tended to get worse value for money. That’s obvious here: the Auditor General found a desire to support local industry meant the torpedo program was pushed ahead despite critical difficulties with the project.

You’d have thought the government would have learnt from the Collins class submarine fiasco, which was built in Australia to everyone’s great regret. But the government intends to build the next generation of submarines in Adelaide too. In fact, two-thirds of the $100 billion expected to be spent on defence acquisitions over the next decade will be spent in Australia.

That’s because politicians don’t like to miss any opportunity to claim they’re “creating jobs”.

The bigger the problem is the easier it is to spend other people’s money irresponsibly. Reckless spending is common across all areas of government. But it’s especially common in Defence, where decisions about what to buy are based on guesstimates of the strategic environment 10 or 20 years down the track.

Yet once procurement programs are started, they’re hard to stop. One military insider told The Australian earlier this year, “to question the F-35 inside the Defence Department is a dangerous career move”.

The Rudd government intends to clean up military procurement.

But don’t hold your breath. Ever since the Turana project – a pilotless target aircraft for the Navy – was embarrassingly cancelled in 1979 there have been frequent reviews into reforming Defence procurement processes. They all find endemic mismanagement, and they all recommend greater accountability.

Defence procurements are highly technical, often secretive, and far removed from the eye of the taxpayer. But the torpedo program makes the home insulation scheme look like the ideal model of policy development.

It would be delusionally optimistic to believe this is the last indictment of a Defence program we’ll see.

Why trimming the waste line is harder than it looks

It must be election time: fiscal conservatism is fashionable again. Tony Abbott and Joe Hockey go into this election with a battle cry about the Rudd government’s budget deficits and ballooning national debt. Kevin Rudd claims the budget is heading unstoppably back to sweetness and surpluses, but the opposition still has a case – by 2011, the government will owe $90 billion, 6 per cent of our GDP.

Hey, fiscal conservatism worked for Kevin07. It might work for TonyTwentyTen. But fiscal conservatism is easy when budgets are riding high and government debt is negligible. If the budget isn’t balanced, and debt needs to be reduced, then you’ll want to identify government programs to cut.

In his budget reply on Thursday, Abbott identified a couple of cuts – abandoning the national broadband network, fiddling with the building education revolution, and a freeze on hiring new public servants for a while. And reducing government advertising. Every opposition wants to reduce government advertising.

It’s a pretty tepid start, but it’s a start; Joe Hockey will apparently propose more cuts this week.

He’ll need to. If the Liberals want to walk the ”high road of expenditure restraint” and clear the national debt as soon as possible, they have to cut a lot more spending. Luckily, nobody has to look far to find things to cut.

The government is giving a not-for-profit $120,000 so they can host an interstate rickshaw ride to raise awareness of poverty. We’re giving a wallpaper company in New South Wales $36,000 to update its website, and $70,400 to another company so it can develop a ”social game platform”.

As well, $15,000 went to a team of glass percussion artists, $100,000 has gone to a Hervey Bay company to build two new cabins in their caravan park, and $8000 of federal money paid for an electric scooter-charging station in Victoria Park, Western Australia.

These are all part of multimillion-dollar programs that could be eliminated instantly.

Then there’s the $13 million we give to the Australian Wine and Brandy Corporation, and the Grape and Wine Research and Development Corporation’s $27 million. (They’re different, apparently.)

And the $150 million the government plans to spend on that idiotic ”Nothing Like Australia” tourism campaign. And the $254 million for elite sport programs.

That should be the test. You’re not serious about reducing government spending if you’re unwilling to upset the men’s Olympic volleyball team.

With so many so obviously absurd programs, you’d think eliminating waste would be easy. But every program, no matter how silly or unnecessary, has passionate supporters.

When the government spends, it makes some individuals and industries reliant on that spending. And public servants whose careers depend on that spending’s future. No matter what, someone, somewhere, gets upset when you cut a government program.

So governments are usually reluctant to get rid of anything.

Take the Department of Climate Change. Its 640 hand-picked bureaucrats were charged with implementing the government’s emissions trading scheme.

So you would have thought once the government abandoned the scheme, those bureaucrats might no longer be needed. More fool you. They’re still there: patiently waiting for their real jobs to start, filling in the long hours of the day tinkering with renewable energy regulations and trying to fix the insulation program.

On the Labor side, politicians with ties to public service unions hate the prospect of eliminating the jobs of their supporters.

And when Joe Hockey flagged the possible public service reductions earlier this year, his Liberal parliamentary colleague Gary Humphries said Hockey would have him ”to reckon with”. Humphries is the Senator for the ACT, and Canberra is a government town.

Right now, no one is more aware of how hard cutting the size of government can be than the new British Prime Minister, David Cameron. He enters No. 10 with the country labouring under more than $A1.3 trillion of national debt. If the United Kingdom doesn’t want to become the Greece of the north, Cameron will have to do something drastic.

Certainly, both Gordon Brown and Cameron went into the general election saying how much they wanted to tackle this debt. Brown proposed reducing government expenditure by 10 per cent, cunningly campaigning on an ”I broke it, I’ll fix it” platform.

But neither candidate was eager to go into too much detail about just what spending they planned to cut. Because many of those cuts will have to be public service retrenchments.

No matter how much the British people say they want the UK’s budget back in the black, it will take a lot of political courage for Cameron to get it there.

In Australia, that’s a big problem too. There’s much government waste to cut. But waste has friends and cutting waste makes enemies. Nobody wants to make enemies in an election year.

Should terror suspects be protected by politics?

In Dr Strangelove, the crazed General Jack D Ripper claims ‘war is too important to be left to the politicians’.

So, it seems, is terrorism.

It’s been just over one week since a Nissan Pathfinder caught fire in Times Square. The press has focused on the modest drama of stopping the departing Emirates flight carrying the alleged terrorist Faisal Shahzad, as he tried to leave the country.

But still,it seems he was pretty easy to catch.

The Pathfinder was taken to a forensic lab where investigators quickly traced its provenance – it had been sold on Craigslist, two weeks before the incident. The sale was made in $100 bills in a supermarket car park.

But the seller had the buyer’s mobile number. And, with a sketch artist, was able to draw a picture of buyer’s face. Better: the buyer had driven himself to pick up the Nissan, and left his black IsuzuRodeo in the car park.

With the registration of the Isuzu, investigators now had Faisal Shahzad’s home address. They didn’t even have to break in. The key to his apartment was in the Nissan’s ignition.

Shahzad was in custody 53 hours after the bomb was left in Times Square.

The tale of Shahzad’s speedy arrest makes him look less like a formidable jihadist with Pakistani terror camp training, and more like an incompetent, failed criminal.

But it’s worth dwelling on the particulars of how Shahzad was identified and arrested because the legal system largely worked.

What little effort Shahzad made to cover his tracks was easily side-stepped. He took two days to try to leave the US. The US government says Shahzad claims to have learnt bomb-making from the best, but his bomb didn’t work.

And the legal case against Shahzad seems to have been made even easier because he started chatting to the FBI, apparently giving them “valuable intelligence and evidence”.

Seems too simple, doesn’t it? That’s because the politicians haven’t become involved yet.

Take the question of whether Shahzad should have been informed of his legal rights at his arrest. After investigators confirmed there were no other attacks imminent, he was. John McCain claimed doing so was a mistake. And the ranking Republican on the Homeland Security Committee, Peter King, strongly agreed, adding: “I know he’s an American citizen but still…”.

Joe Lieberman upped the ante by proposing to give the government power to remove anybody’s American citizenship if they are merely suspected of being a terrorist. In their view, the rights we afford criminals are getting in the way of winning the war on terror. But the sorts of legal changes they recommend could very well lose it.

Terrorism is against the law. It’s against a lot of laws. And even in a post-Guantanamo world, terrorism trials are conducted in the shadow of centuries of legal precedent, an adversarial court system, and extensive avenues of defence and appeal.

Those bombastic tough-on-terror politicians – if they got their way – could easily undermine terror prosecutions. Because it’s not a question of whether terrorists deserve legal rights. It’s that ignoring those rights allows terrorists to avoid justice.

As David Frum has pointed out, if Lieberman’s proposed citizenship laws were in effect, the US would be on its way “to court right now to litigate the issue whether the Times Square bomber’s bombing plot indicated an intent to relinquish his nationality. Only after taking that issue through trial and appeal (maybe multiple appeals) could we get to work questioning and punishing him”.

It’s happened before.

Ali Saleh Mohamed Kahlah al-Marri was arrested shortly after the September 11 terrorist attacks, accused by the government of being an al-Qaeda sleeper agent, and taking orders directly from Osama bin Laden.

With all the charges against him, al-Marri potentially faced 143 years in prison if convicted in a civilian court, according to the Cato Institute’s David Rittgers. But the Bush administration was eager to show that American counter-terrorist efforts were a ‘war’ in America as much as Afghanistan. It moved him out of the civilian court system and into military custody.

As a result, after years of legal wrangling and a Supreme Court case, he was convicted in October 2009 on just one count of material support for terrorism. He got eight years.

If you want to punish terrorists to the fullest extent of the law possible, that’s an awful outcome.

Like Australia, the United States has a civilian legal system which has evolved from centuries of English legal precedent. It’s handled mass murderers and politically-motivated misdeeds for hundreds of years.

Terrorists believe they are freedom fighters; captured terrorists believe they are political prisoners. Let’s give them the disrespect they deserve and treat them like common criminals
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Spurious notions of ‘national character’ aren’t helping

Are Australians racists? Well, yes. And no. Some are, some aren’t. It’s a mind-numbingly circular question, but just the sort of mind-numbingly circular question that those in the social commentary business love. (Six idiots dress up in blackface on Hey Hey it’s Saturday, and that’s the first half of Q&A over with, two weeks’ worth of columns in quality broadsheets, and a comfortably full switchboard on ABC radio talkback.)

Let’s try to wrap up this question now. It would be fair to assume that somewhere between one and 22 million people within Australia’s territorial borders are racist. It’s faintly ludicrous to attribute any sort of character to a collective group of people. Either the characterisations end up as utterly banal — Australians like barbecues! — or completely nonsensical.

A columnist trying to get to the bottom of the recent spate of attacks on Indian students in Melbourne writes that Australia ‘has a cultural tradition that in large part is underpinned by aggressive opportunism’. Michael Leunig reckons: ‘Our culture has thrived on the stabbing impulse.’ But on the other hand John Brumby has argued that ‘Victorians are committedto tolerance’ in an article condemning racially motivated attacks by some of those apparently tolerance-committed Victorians.

Maybe ‘we’ are racists, but ‘we’ also must be pretty cluey. A recent article discussing the Howard government’s environmental policies says that ‘the Coalition’s new-found eco-friendly initiatives were deemed greenwash by the electorate’. Very perceptive. Makes you wonder why a full 22 per cent of the electorate believe in witches, at least according to a Nielsen poll late last year. Headlines in the National Times declare that ‘we will forget Haiti’, that ‘we give our kids names fit for puppies’ and that ‘we love to click on’ Naomi Robson. I don’t plan on doing any of those things.

The idea that Australia has any sort of national character obscures our understanding much more than it facilitates it. Individuals, actions, and laws can be objectively racist. Nationalities cannot. After all, even the clearest example of racism in this nation’s history, the White Australia Policy, had its opponents, particularly among the free trade movement.

Of course, national circumstances — politics, history, geography, religious belief, sheer bloody luck — can influence the cultural attitudes of individuals within that nation. But you only have to watch our Prime Minister’s awkward attempts at Australianisms to see how artificial these national tropes can be.

Personalities do not change at national borders. How many times have you been told by recently returned overseas holidaymakers that ‘the people were just so friendly’? There are more than 3,000 hits for ‘the people are friendly’ on the Lonely Planet website. There is just one for ‘the people are unfriendly’ — you won’t want to go on holiday to Rome.

A 2005 study in Science sought to test views about national character against personality traits of individuals within that nation. The study found that ‘Perceptions of national character are not generalisations about personality traits based on accumulated observations of the people with whom one lives’; in other words, there was no correlation between a belief that Australians are extroverts, and the number of Australians you’ve met who are actually extroverts. And the study found that people vastly exaggerate what little differences do exist between countries. There is much greater variety of character within a nation than between nations. If you don’t believe that, compare Mark Latham with Kevin Rudd. Hard to believe they’re from the same party, let alone the same country.

It would be nice to believe all Australians recognise that democracy should be tempered by the common law, political power and judicial power should be in constant opposition, and human rights need constant and aggressive defence. But once again: 22 per cent of Australians believe in witches. This isn’t just a complaint about vapid rhetoric. When faced with reports of attacks on Indian students, it would probably be better to avoid all this empty navel-gazing about the possibility that racism is inherent in our national character, and focus on what concrete political failures may have tolerated those attacks.

Victoria has the lowest number of police per capita in any Australian state. That is surely more a factor in the state’s urban violence problem than any ‘cultural tradition [of] aggressive opportunism’. A psychological profile of Australia’s national character — if it’s even possible — is of absolutely no use when we can’t get basic policing right.