Opening statement to Commonwealth Legal and Constitutional Affairs Legislation Committee inquiry into the Copyright Amendment (Online Infringement) Bill 2015

Copyright is a limited quasi-monopoly privilege granted by the state to authors of creative works for a specific and utilitarian purpose, which is to encourage the development of new creative works. This, in my view, is the proper frame in which to consider any changes to copyright law or any new mechanisms to control copyright infringement such as are proposed in the Copyright Amendment (Online Infringement) Bill. To what extent will changes in the law encourage or discourage the creation of new works?

Parliament has a complicated balancing act to perform. Copyright, after all, is not socially costless. It constrains what we might be able to do otherwise with our own property. It prevents us from exercising rights to how we might use our printing presses, musical and television equipment, computers or internet connections. This is not at all to say that the copyright privilege is unjustified or unjustifiable—far from it—but that the utilitarian calculation that society needs to make when considering copyright is whether the benefits of any marginal changes to these privileges outweigh the costs to more fundamental rights like freedom of expression and the right for individuals to use their property and possessions as they see fit. This is why the Howard government’s 2000 Ergas report into intellectual property argued:

Over-compensating rights owners is as harmful, and perhaps even more harmful, than under-compensating them.

Quite apart from any freedom of expression concerns with the copyright bill before parliament, it is not at all clear to me that the social benefits conferred by this new censorship power to block access to websites outweigh the social costs. The Institute of Public Affairs has an in-principle objection to internet censorship on free speech grounds, which I think by now most people will be familiar with, but there is a specific issue I want to raise in the context of this bill.

The bill dramatically lowers the bar for which internet censorship is being proposed. After all, while the previous government’s internet filter proposed to block websites that were hosting violent pornography, child abuse material and so forth, the bill before parliament today proposes censorship on the basis that some websites host copyrighted content. The two censorship proposals are hardly the same scale and, in the case of copyright infringement, we are actually talking about a civil rather than a criminal wrong. The language in the bill is excessively vague. Other submissions have pointed to the undefined and broad consequences, for instance, of the word ‘facilitate’ and warned of possible judicial creep. But I would like to make a final observation.

Parliament, and the political process, is not a venue well-designed to calculate dispassionately the most efficient level of copyright privileges and the most efficient changes to enforcement mechanisms. This is a well-known collective choice issue. It may be possible to draw blackboard diagrams that determine the ultimate copyright rules and level of enforcement. However, unfortunately, policymakers lack the necessary information to do so. Copyright law therefore suffers from what Friedrich Hayek famously called the ‘knowledge problem’. That problem, in our view, presents a strong presumption against further increases in the copyright enforcement powers and an absolute presumption against internet censorship for copyright purposes.

Free speech in a liberal democracy

Speech at ‘Free Speech 2014’, Australian Human Rights Commission, Sydney, 7 August 2014.

Australia is a liberal democracy and liberal democracies are founded on freedom of speech.

This was the intuition behind the High Court’s discovery in the early 1990s of our implied right to political communication.28 That right, in my view, is deeply inadequate.

But for our purposes today, I’ll point out that the right to political communication isn’t really a ‘right’, per se, at least not in the way that we are used to speaking about human rights: as universal, based on fundamental moral principles, and innate to our personhood.

It’s a more of a pragmatic legal workaround to a basic contradiction in Westminster government. The Parliament gets its legitimacy from the fact that it is freely chosen by the conscience and debate of free citizens. But the Parliament is able to write laws that determine the rules under which that debate may be conducted and what consciences may be publicly expressed.

Then again, if the right to political communication is all we are offered, I’ll take it.

Today I want to do two things. First, I want to briefly lay some foundations for the right to freedom of speech. These foundations are philosophical. You might even say ideological.

The last three years of free speech debate, beginning with the Andrew Bolt case, has been an ideological one, as it should be. Pretending that free speech is just a matter for lawyers to negotiate competing rights claims in court – or, worse, for human rights technocrats to arbitrate between different international human rights ‘instruments’ – is to pay lip service to human rights. Human rights are fundamentally political claims.

Second, I’ll connect these principles to a few examples of what I consider to be the more interesting and concerning limitations on free speech today. The great American legal academic Lee C. Bollinger once wrote that ‘free speech is not just a practical tool for making systemic repairs, but an affirmation of what we value as a people’. He went on, ‘the reason we shelter speech is as important as the speech we shelter’. The popular free speech debate is mediated through a thicket of metaphors and analogies. One of the most common is that one cannot falsely shout fire in a crowded theatre.

It is astonishing anybody still uses this metaphor: it was conceived as a justification for the suppression of socialist anti-war dissent during the First World War. The ‘crowded theatre’ was the American war effort. To falsely shout fire was to contentiously object to that war. If we insist on the use of metaphors to determine our ideas of free speech, then it is hard not to see the stubborn persistence of the crowded theatre as itself a metaphor for the way free speech limitations are almost always defences of the power of the state.

Freedom of speech is, ultimately, the outward manifestation of the deeper freedom of individual conscience, of thought. It is our thoughts – our preferences, our ideas, our faiths, our internal differentiation from the collective – that make us individuals, that make us human. A recognition of that forms the basis of pluralistic liberal democracy.

Free speech is not a tool to make the state function better, as the High Court’s reasoning suggests it is. Rather it is fundamental to our individual moral autonomy.

I understand that’s a bit wishy-washy. But talking about principles seems to be more productive than the opposite: the philosophically empty busy-work that constitutes most debate about human rights in Australia today – that is, measuring Australian law against international treaties and identifying where the two differ.

And on these principles Australia has a massive freedom of speech problem. Our defamation laws are heavy-handed and have a demonstrable chilling effect on speech. Our sedition laws are excessive. Our classification scheme is effectively a censorship scheme. Our communications regulator believes that its job is to adjudicate whether speech on radio and television is
sufficiently balanced. We were told that the federal government abandoned the internet filter a few years ago, but section 313 of the Telecommunications Act 1997 (Cth) operates exactly as opponents of the internet filter feared Labor’s policy would.

And last week we learned that a super-injunction can prevent us discussing the absolutely scandalous foreign activities of the most important economic institution in the country – a super-injunction that we are told is necessary to protect national security. Of course it is. The bottom line from that super-injunction is this: I am unable to discuss the unlawful activities of a government department at a national conference on free speech.

Let me briefly mention a few policy proposals on the cards that have substantial free speech implications. First is the government’s proposed Children’s e-Safety Commissioner. They will have the power to delete material from social media sites – the phrase is ‘rapidly takedown harmful material’. Bullying is a serious issue. But the proposal will offer no material benefit to children who are being bullied. It is a strong example of how moral panics ultimately manifest in attacks on speech.

Second is the proposed anti-copyright infringement scheme, which would allow courts to block – that is, censor – overseas websites from being accessible in Australia. Once again, how does this differ from Labor’s reviled internet filter proposal?

Finally it is worth dwelling on the new frontier in freedom of speech restrictions – government surveillance. The sensation of being watched – and the fear that private speech or expression is going to be recorded or scrutinised – makes people more reserved and less willing to participate in discussion. As one significant study concluded, ‘the threat or actuality of government surveillance may psychologically inhibit freedom of speech’.

This is something to reflect on since the federal government announcement that it was seeking to require internet service providers to retain records of their customers’ internet activity for two years. What websites would you be reluctant to visit if you knew that they were going on your two-year activity record at your Internet Service Provider (ISP), for any of Australia’s dozens of law enforcement agency or regulators or quasijudicial bodies to trawl through years later? What would you decide not to read, or watch, or look at in the privacy of your home? What links would you regret clicking? What emails would you avoid sending?

Mandatory data retention is, and will be, a truly repressive attack on free speech. That’s even before we start talking about its privacy implications. Or its cost.

The Abbott government came to the 2013 election promising to pursue what it described as a ‘freedom agenda’. In August 2014 it also announced that it was abandoning its promise to repeal section 18C of the Racial Discrimination Act 1975 (Cth). Apparently it would be too divisive to restore, in some small way, free speech, while introducing a policy, data retention, that will suppress free speech. This is incredibly disappointing.

So what is left of the freedom agenda? For my organisation, the Institute of Public Affairs, and its thousands of individual members, section 18C is still an iconic and unambiguous limitation of free speech. We will continue to fight to repeal it, whether under this government or the next.

The Roman historian Tacitus defined the essential attributes of free Roman citizenship as one who ‘can feel what we wish and may say what we feel’. Without such liberties, liberal democracy is weak, and our human rights are without protection.

Opening statement to Commonwealth Legal and Constitutional Affairs References Committee inquiry into Comprehensive revision of the Telecommunications (Interception and Access) Act 1979

With Simon Breheny

Thank you, first of all, to the committee chair, Senator Scott Ludlam, and the other members of the committee for inviting us to speak with you this morning. At the outset, let me make some general statements of principle. These principles should guide any reform to the Telecommunications (Interception and Access) Act 1979.

Interception and access of telecommunications data by government agencies is an intrusion into the human right to privacy. As individuals we have the right to control aspects of our lives that we wish to keep private. Government access to communications data should be strictly limited. The first limitation on access to communications data is the requirement that it must be targeted towards a person reasonably suspected of criminal wrongdoing. The second limitation is that interception of and access to communications data should only be allowed in accordance with a warrant issued by the courts. Warrants allow the interception and access to communications data in limited circumstances. They create a threshold for interception and access and ensure a level of accountability of the law enforcement agencies conducting criminal investigations by judicial oversight.

The proposal to introduce a mandatory data retention regime in Australia is a clear violation of these principles. Mandatory data retention would establish a systematic and ongoing mass surveillance regime on the internet activity of everyone in Australia. It is a very serious breach of privacy; it is easily circumvented and it is likely to suffer significant mission creep. As my colleague Chris Berg has argued, mandatory data retention will also have a chilling effect on free speech. The Australian privacy principles were updated and implemented just six months ago, yet mandatory data retention is a policy that would require the explicit rejection of these principles—namely, that businesses, including internet service providers, should only retain the information that is required for business purposes and should delete that data when it is no longer required for those same purposes.

We have seen in recent times some very significant breaches of privacy by government agencies. Most recently, the Australian Federal Police was responsible for a very serious breach of privacy when it revealed the identities of criminal suspects and other details about criminal investigations. Such inadvertent disclosures are unavoidable, but government should be seeking to reduce the possibility of these disclosures where possible. It is also worth noting that it has not been adequately shown that preservation orders are not adequate to achieve the aims of the law enforcement. Stored preservation orders are targeted, proportional data retention schemes that offer a flexible and privacy-protecting mechanism to law enforcement agencies. It is striking to us how rarely the existence of this mechanism is discussed in the data retention debate when it would seem to resolve all the problems with the TIA act that have been identified by law enforcement agencies.

The authorised access regime established under the TIA act allows for warrantless access to communications data stored by telecommunications companies. This is a clear breach of the principle that access to communications data should not occur unless a warrant has been issued by judicial authority. The TIA act annual report 2012-13 revealed that there were more than 300,000 access authorisations made in that year. Some of these authorisations were made by organisations like Australia Post, the Clean Energy Regulator, Harness Racing New South Wales and the Wyndham City Council. The authorised access regime should be abolished and should be replaced with a regime where communications data may only be accessed in accordance with the warrant issued for that purpose.

One of the problems we have identified in this debate concerns the word ‘metadata’ as opposed to ‘content data’. In our view the word ‘metadata’ describes nothing of analytical value; it is all just data. Indeed, as has often been pointed out in this debate, metadata is capable of revealing even more than what has been described as content data. We are happy to discuss the issue in detail if the committee wishes. Thank you.

Opening statement to Commonwealth Environment and Communications Legislation Committee inquiry into the News Media Reform Package 2013

With Simon Breheny

The news media reform package 2013 is nothing less than an attack on freedom of speech and freedom of the press in Australia. It is absurd to claim that the government could institute a regulator to regulate media self-regulators like the Australian Press Council and pretend that doing so would not constitute substantial new government oversight of the free press. This is a fundamental conceptual error with very disturbing consequences and, in our view, government oversight of the press is unacceptable in a liberal democracy. The government has no business deciding what constitutes fairness or balance in a media whose job it is to hold them to account. That ought to be a bedrock principle accepted by all sides of political debate.

We have a number of specific points we would like to raise about the proposed public interest media advocate. The government-appointed PIMA would be responsible for deciding which news media self-regulation bodies’ members would receive an exemption from the Privacy Act and which would not. This regime means that news outlets will never be able to write about things that are claimed to be personal or sensitive. The news-gathering functions of a news media organisation would be shackled for fear of breaching the Privacy Act. To us, the coupling of Privacy Act exemptions with regulated membership clearly makes this a de facto licensing system, further emphasising the significance of the attack on free expression that the proposal represents.

The minister can directly and unilaterally appoint any person to the public interest media advocate role. Government members of this committee might reflect about whom a future government could appoint and whether instilling such significant powers over the press on a political appointee is democratically desirable. This is doubly so because of the entirely undefined concept of public interest that this entire project seems to be founded on. I am sure that our idea of what is in the public interest is different to the ideas of some members of the committee.

The proposed regime also undermines fundamental legal rights. The bills provide no avenue for appeal of a decision of the PIMA, they reverse the burden of proof in cases of proposed media mergers and they use ambiguous terms that give the PIMA enormous discretionary power.

The most disappointing part of this process is how the government has completely shirked the necessary reform to regulatory frameworks governing media and communications. There is almost nothing in these bills that deals with the serious and important problems in media regulation brought about by technological convergence. Instead, the process seems to have been entirely diverted by a partisan battle between one side of politics and one media company.

We have one final, broader concern. Chris Berg and I appeared before another Senate inquiry into another bill less than two months ago, on 23 January 2013, to defend freedom of speech against another real threat posed by legislation that this government proposed. That bill was the draft Human Rights and Anti-discrimination Bill 2012. Both pieces of legislation seek to shrink civil society by restricting free speech, one under the guise of human rights and the other under the guise of fairness and accuracy in the media. For these reasons, it is our view that the bills should be rejected.

Opening statement to Commonwealth Legal and Constitutional Affairs Legislation Committee inquiry into the Human Rights and Anti-Discrimination Bill 2012

With Simon Breheny and Tim Wilson

We thank the committee for inviting us to give evidence this afternoon. The exposure draft Human Rights and Anti-Discrimination Bill 2012 is an attack on our fundamental freedoms. The draft bill is not simply a consolidation of existing Commonwealth acts, as the government has claimed; it is a radical overhaul of anti-discrimination law. There are many problems with the draft bill. The most concerning aspect of the draft bill is the significant threat it poses to freedom of speech. The definition of discrimination has been expanded to include conduct that offends or insults. Given this new definition of discrimination, the inclusion of political opinion as a ground on which a claim can be made is absurd and dangerous. Under the draft bill, you could be taken to court for saying something that offended someone because of a political opinion they hold.

The freedom to express political opinions in all areas of public life, even those that offend and insult others, is central to the functioning of our system of government, as the High Court has found. By undermining the freedom of speech, the draft poses a grave threat to the health of Australian democracy. It is wrong to say that the draft bill could be amended to a point where it is acceptable. Simply removing the words ‘offend’ and ‘insult’ from the new definition of discrimination will not save the draft bill. The real problem is the whole project itself. The draft bill is not about antidiscrimination; instead, the consolidation project has resulted in a draft bill that undermines liberty and places the state at the centre of our interpersonal relationships. Rather than making the law clearer and simpler, the draft bill adds significant complexities to this area of law.

The draft bill also reverses the burden of proof for claims of discrimination. This is completely unacceptable. The person bringing a legal claim should always bear the burden of proving their case. This principle—the idea that a person is innocent until proven guilty—is the centrepiece of a just legal system. Reversing the burden of proof creates an unjust system.

The draft bill will erode civil society by encouraging reliance on apparatus of the state for the resolution of private disputes. It threatens to lead Australia towards a US-style culture of litigation. The constant erosion of our freedoms must end. This draft bill is a disturbing example of the ever-increasing power of the state. It shows that it is now time to swing the pendulum back towards liberty rather than away from it and to take back control of our own lives. The draft bill is a threat to freedom of speech, freedom of association and freedom of religion. The Institute of Public Affairs calls on the committee to recommend the outright rejection of this dangerous draft bill.

Opening statement to Parliamentary Joint Committee on Intelligence and Security Potential reforms of national security legislation

With Simon Breheny

The suite of policies proposed in the Attorney-General’s discussion paper add up to one of the most significant attacks on civil liberties in Australian history. Many of the proposals breach the rule of law, severely curb civil liberties and threaten freedom of speech. Our submission focused on the data retention proposal. We were disturbed to see the Attorney-General support this proposal yesterday. In our view, the data retention proposal is a much greater threat to privacy than even the proposed Australia Card was in the 1980s. The complexity of these discussion papers’ proposals is significant. Many of them interact with multiple pieces of legislation. Few have been elaborated or justified. They should be dealt with separately, with separate legislation and separate inquiries. The burden of proof rests on the government to prove to the public that after 10 years of continuous, unrelenting increases in national security power—the last major change was as recently as August this year—there is still a clear need for such extraordinary changes. Almost every single proposal in the discussion paper has serious problems. For instance, the proposal to establish an offence for failure to assist in the decryption of communications is a clear abrogation of the government’s responsibility to uphold the privilege against self-incrimination and the right to silence—vital features of our criminal justice system. We call on this committee to reject this proposal.

We also oppose the default extended period for warrants from 90 days to six months, the lowering of thresholds for obtaining warrants, the power of the Attorney-General to unilaterally vary warrants and the power of ASIO to move, alter or delete data. But the most extraordinary proposal we would like to talk about is that of data retention. This draconian proposal for mandated and indiscriminate retention of the online data of all Australians is completely lacking in proportionality, undermines basic freedoms and is in fundamental conflict with the right to privacy. Extraordinary claims require extraordinary evidence, yet no evidence has been presented to justify one of the world’s most onerous data retention regimes. Abstract references to emerging threats and cybercrime are patronisingly insufficient as justification for such an extreme example of state power.

The collection and storage of data by internet service providers also creates a considerable data security problem. Rather than dispersing information, data retention creates silos of information begging to be attacked by the very criminals this proposal seeks to limit. Many European nations have had data retention regimes in place for a number of years. A study conducted over a five-year period, from 2005 to 2010, found no statistically significant increase in crime clearance rates in countries that had adopted data retention. ‘Australians should not allow themselves to be bullied into accepting a proposal which has ominous implications and particularly a grave temptation for abuse by the government.’ That was said by the IPA in 1986 in relation to the proposed Australia card, and the same holds true for the proposals being considered here today.

Opening statement to the Independent Inquiry into Media and Media Regulation

I have serious concerns about the political circumstances under which this Inquiry was formed. The relationship between the government, the Greens and News Limited is unrelentingly hostile, as we all know, and the Inquiry is clearly and explicitly the result of that hostility.

Nevertheless, obviously questioning the political purpose of the Inquiry is within the terms of reference and I would like to speak to those, but I think that the circumstances under which the Inquiry was formed do actually provide an implicit guide for the Inquiry itself. The Inquiry needs to avoid any suggestion that the result of those circumstances is an increased regulatory burden on the opponents of the government.

I am also concerned because the Inquiry, in my view, seems to be asking some of the wrong questions and travelling down some of the wrong paths. Never before have consumers had more access to more media. Never before have citizens had such an opportunity to create their own media, and never before have the business models that sustain the press been under such intense and escalating strain. The walls that separate journalists from consumer, blogger from publisher, commenter and broadcaster online are completely breaking down. It is my strong view the implication of these trends implies that regulation of the press should be, if anything, reduced. Certainly I will go further and suggest that many of the concepts which have been raised and may be raised in the future by this Inquiry might be seen as anachronistic within the next decade.

I don’t speak from a journalism perspective, but from a political economy and political philosophy perspective. Many of the suggestions that have been raised so far by some submissions and some commentators in the press I find extremely objectionable when we consider the high importance that the liberal democracies place on freedom of speech.

It is my view that journalists, commentators, bloggers, people yelling on street corners and even media moguls should have their freedom of speech protected equally. Thank you.

Underdevelopment in the Middle East

Address to the Rotary Club of Central Melbourne

If, 1000 years ago, you had been asked which civilisation would likely dominant the next millennium, Islam would have been a fair bet.

Our best estimates of historical global income suggest that the Middle East was richer than Europe. Islamic trade networks spidered across the world – certainly, much further than the trade networks of Christendom.

Fast forward to 2011, and the Arab world is impoverished, at least compared to the liberal West. The 22 states of the Arab League have an average income less than a third of that of the Western world.

The Arab world is deeply unfree. Its states are almost uniformly illiberal. Its economies are highly regulated, bureaucratic, and its governments are corrupt.

The Arab Spring – the rolling waves of revolts and revolutions which have swept the Middle East since the start of the Tunisian uprising in December last year – should demonstrate clearly the widespread dissatisfaction with this status quo. The citizens of the Arab world want to be free and democratic, and it want to equally successful as the now dominant West.

This raises two questions. How did the Arab world slip so far behind the West on the metrics which we would consider the indicators of social progress – prosperity, liberalism, and democracy?

And does the answer to that question tell us anything about the capacity for the Arab world to catch up – in other words, is whatever held the Middle East back destined to hold it back forever?

The obvious topic here is Islam – both Islam as a religion, and as an organising principle of political economy. Is Arabic underdevelopment Islam’s fault?

No – the fault, according to a comprehensive study by the Turkish institutional economist Timur Kuran, lies not with Islam, per se, but with the development of Islamic law.

A legal system, as we all intuitively know, sets the framework in which capitalist and market development can occur. The laws governing shareholder liability, for instance, or what is allowed in banking, or bankruptcy, can either enhance market efficiency or impede it.

One should be careful interpreting another’s religion for them, but Islam started as a very market-friendly religion.

Mecca was a thriving trading community, a strategic hub between Byzantium and India. It is hard to overestimate how central trade and commerce was to Islam’s theological birth. Muhammad himself was a caravan trader and a business manager. As one historian has written, to ignore the role of commerce and markets in the development of Islam and the life of its founder, is like ignoring the role of oil in contemporary Saudi Arabia.

No wonder then that the Qu’ran is steeped with the din of markets. It defends the institutions of private property, contract law, and profit through trade. “Let there be amoungst you traffic and trade by mutual consent,” speaks one passage. One liberal Muslim scholar argues that the Qu’ran provides a strong foundation for limited government, decentralisation, and restraints on the private sector.

The Islamic pilgrimage was as much a religious event as a commercial one – the Qu’rans call for pilgrimage is followed immediately by this passage “It is no sin for you to seek the bounty of your Lord by trading”, and pilgrims would receive this blessing: “May Allah accept your pilgrimage, condone your sins, and let you find a good market for your wares”. Timur Kuran argues that the pilgrimage to Mecca was the Islamic world’s “leading commercial event” well up until the 19th century.

Islamic society – early Islam at least – was a highly commercial social society. One study suggests that 75 per cent of religious scholars and jurists earned their living from business ventures.

Muslims were among the world’s greatest entrepreneurs and explorers. When the city of Canton on the Chinese coast was captured by bandits in 878 AD, they found 100,000 Middle Eastern traders there. Indeed, the first age of exploration was a Muslim age of exploration.

During the 15th century, Muslim merchants were sailing from Morocco to Southeast Asia, entirely unimpeded. The Western explorers that followed found Muslim communities almost everywhere they went.

So how did such a commercial, entrepreneurial society slip behind the West? Timur Kuran argues that the institutions of Islamic law which had well served it in the first half-dozen centuries failed to encourage and support the forms of capitalist organisation which quickly spread in Europe from the fifteenth century onwards.

While Islamic commercial law was rich and strong nearly two centuries before Europe had even developed its vaunted “law merchant”, it failed to develop as innovatively in the centuries to come.

Indeed, the centuries where Islamic trade was at its height were also the centuries when Europe was experimenting with different institutions for commerce.

For instance, the joint stock company. Islamic law supported a form of incorporation, the partnership. But that partnership was fragile. It could be dissolved at any time, according to the preferences of just one of the partners. And if one of them died. The risk of that partnership obviously increased as the number of partners increased. As a consequence, partnerships were small, and usually temporary. For every new venture – say, for example, a trading mission – partnerships had to be reformed.

Compare this to Europe.

The Medici enterprise was an extraordinary complex, and extraordinarily long-lasting commercial organisation – a series of subsidiary partnerships, inter-city networks, and accounting innovations meant that the Medici enterprise lasted a massive 97 years, from 1397 to 1494. Its model, and the lessons from that model’s management, were replicated widely.

Then the joint stock company, facilitated by changes in European law which smoothed the process of reorganisation as shares were traded. Early join stock companies included the English Levant Company, and the East India Companies – Dutch, French, and English.

The importance of corporate institutional innovation for the development of the European economy has been well-recognised by economic historians. Timur Kuran identifies a number of barriers to the development of the company in Islamic law, for example, polygamy – which, combined with generous inheritance laws, undermined the formation of large amounts of capital. If inheritance only goes to the first born in a monogamous marriage, wealth remains intact. If it is split between numerous children and numerous wives, any wealth formed disappears after a generation.

Islamic law did not encourage new forms of corporate development, but that doesn’t mean Islam is inherently hostile to the corporation. It has been widely embraced from the 19th century onwards. Fundamentalist Islam does not campaign against the shareholder enterprise.

But the Islamic world’s delayed embrace of sophisticated forms of capitalist development have held it back considerably.

And it a brief survey of the contemporary Arab world suggests that it is hardly complete.

The Arab World lacks the economic freedom necessary for prosperity. By economic freedom, I’m going to adopt the classical definition – a political economy where people are free to acquire and use their property as they see fit, as long as they do not impede the identical rights of others.

We can measure economic freedom along a wide range of indices – some direct measures, and some indirect. For example, we can look at relative tax rates, size of government, security of property rights, regulatory impediments to forming business, efficiency of contract enforcement, tariff levels, and so on.

These measures are highly correlated with economic growth, individual prosperity, and a whole host of other beneficial social indicators. Certainly, low levels of economic freedom are closely connected to negative consequences – such as inequality and poverty. This is particularly the case in emerging nations. Economic freedom creates a climate conducive to investment and entrepreneurship, an intuitive argument that has been confirmed empirically, and repeatedly.

The Arab World fills out the bottom ranks on many of measures of economic freedom. This is a substantial backward step from the past – as one Arab scholar has pointed out, in many ways the Arab World was the most open, economically engaged region on the globe for most of its history.

Is culture to blame?

I hope I’ve convinced you that the dominant religion of the region does not have sufficient explanatory power to account for the underdevelopment of the Arab World. Could the problem it be cultural, rather than just religious? It could very well be that centuries of slipping behind the West has encouraged a culture antithetical to the sources of Western success.

Development economists are starting to seriously engage with questions of culture, as it is clear that many of economic history’s greatest questions cannot be answered without recourse to cultural matters.

A paper in the journal of Public Choice earlier this year clarifies that question. It looks at the World Values Survey, the largest and most comprehensive database we have on cultural attitudes around the world.

The paper finds that culture matters – to a degree. While a nation lacks economic freedom, culture is all important. Without formal legal institutions – or when those legal institutions are untrustworthy or unreliably – cultural issues like trust are extremely important.

But the authors of this paper found that as a nation becomes more economically free, the importance of culture declines substantially. The “peace, easy taxes, and tolerable administration of justice” described by Adam Smith is culture-neutral – it does not require, for example, any particular religious belief to function well.

The consequences of this finding for not just Arab development, but also the operation of a pluralistic democracy like Australia, should be obvious.

Let us return now to the Arab Spring, and its relationship to the question of economic freedom and development.

The Arab Spring is above all a democratic revolt. Many in the West have been sceptical about the prospects of Arab democracy because of a fear that the regimes which are elected could be illiberal.

I think this fear is somewhat misplaced, and most certainly unfair. Somewhat misplaced because one of the most striking things about the Arab Spring so far is how Islamist organisations have been united in their call for democratic institutions. This is a substantial change from the past, where revolutionary Islam was more interested in theocratic hierarchy.  We are a long way from the Iranian revolution.

It is worth noting that the loudest proponents of this argument have been the dictatorships themselves – no Middle East autocrat has failed to claim that they’re the only thing holding back the Muslim Brotherhood.

Certainly, it is true that any democracy has embedded in it the risk that it could lead to suboptimal outcomes. We can all name historical examples of democratic failure along those lines.

Yet this is a burden which is unfair to place on societies which are struggling to lift themselves out of tyranny. Yes – revolutions sometimes, even often fail. But that is not a case for the status quo, it is an argument for caution, and a reminder that a tyranny has great costs – including the hollowing out of civil society, the rise of underground extremism, and the political isolation. We cannot rhetorically condemn nations to political servitude if we are weary about the consequences of them escaping that servitude.

Let me raise a serious objection to my argument for economic freedom in the Middle East.

Nevertheless, some have claimed that the Arab spring is a revolt against not just tyranny, but economic liberalisation.

They have some evidence in their favour. Egypt has been liberalising substantially over the last decade. From holding a place at the bottom of the Economic Freedom in the Arab World report, it now occupies the middle. It reduced its average tariffs from 15 percent to just 5 percent. It dramatically lowered the corporate tax rate from 40 percent to 20 percent. Its maximum personal tax rate is now a tiny 20 per cent. It has privatised entire swathes of its government run corporations.

This was a successful program of liberalisation, economically. The average growth rate in Egypt increased from 3 per cent per year around the turn of the millennium to 7 per cent. Unemployment declined from 12 per cent to 9 per cent.

Egypt is still poor. But now it is less poor, and on a trajectory to becoming rich.

Nevertheless, with liberalisation comes great disruption. We know this from our experience in Australia. There was a great sense that this liberalisation was being imposed – as, indeed, it was – by a corrupt and self-serving government. The privatisations have been dogged by secrecy and constant allegations of corruption.

After all, the purpose of privatisation is not simply to sell off assets, it is to introduce market dynamics and competition into industries which have stagnated under government ownership. Consumers, not oligarchs, are the intended beneficiaries of privatisation. Under that criteria, much of Egypt’s privatisations have performed poorly.

Combined with a general view that the government is irredeemably corrupt – from the absolute top of the state apparatus to the bottom, at the level of the local police stations – the potential for revolution in Egypt has been long recognised.

I have argued that the Egyptian revolt against Mubarak helps illuminate one of the great chicken-and-egg questions – which comes first, political freedom or liberalism? The Egyptian example suggests you cannot have one without the other – they must develop together. A tyranny that imposes economic liberalisation will be resented.

Dictators can’t always have it both ways. They can’t reap the benefits of economic growth – their higher tax revenues and more luxuries to hand to political supporters – and maintain complete political control at the same time. No country can be both a police state and a market paradise.

An increase in GDP is no comfort for someone who has been tortured in custody just to fill an arrest quota.

So the push for economic freedom in the Arab world cannot be separated from the push for democracy and liberalism.

Fortunately, we don’t have to impose our own Western values for this to be successful.

They may be rarely spoken of, but Islam has had its fair share of liberal thinkers. I’ll highlight just one.

Khayr al-Din was a Tunisian statesman and author in the 19th century. He travelled widely in Europe, and his investigations there informed his 1867 treatise The Road Most Straight to Know the Conditions of the State.

In this book he reports back to his national compatriots what he understands to be the strengths of the West – in awe of Europe’s military and economic power, nineteenth century Arab nationalists and liberals sought ways to emulate, and eventually, surpass the West.

It wasn’t Christianity, Khayr al-Din argued, that made the West strong, otherwise the Holy See would be the most advanced state in Europe.

Instead, he argued it was Europe’s “political institutions based on justice and freedom” – its low taxes, growing democracy and antipathy to despotism. He argued for freedom of the press, freedom of association, and freedom of participation in government.

Rulers might be beneficent and omniscient, but it was best to assume that they were not. The source of their legitimacy was a fundamental power higher than they – justice. Rulers must be therefore constrained by the rule of law.

And he justified all these arguments on Islamic terms, by reference to the Qur’an.

If the Arab World is going to be rich, it will need to take the advice of Khayr al-Din.

Debate: Is Australia too conservative?

If Australian democracy is getting too conservative, as the affirmative team suggest, what does that mean?

In a speech just before her death, the radical freedom novelist Ayn Rand described contemporary conservatism as the “God, family, tradition swamp”.

I do not believe that is not a particularly appealing trio. Waleed and myself have been asked to contest the statement view that Australia is getting too conservative, but, and I’ll only speak for myself here, I am far from a conservative.

No conservative would believe in the total and immediate abolition of all industry subsidies and trade barriers, getting the government out of the marriage business, a reduction in the armed forces, and opening the borders to almost all immigrants who wanted to come here.

That’s where I stand.

But the idea that Australian democracy has become too conservative is wrong.

On the first, it seems clear that Australian democracy has little interest in conserving anything. The last few decades have seen rapid and overwhelming social and economic change – much of which has been propelled by governments liberalising the legal framework governing individual relations and the structure of the economy.

Every year, the federal government passes more than 6000 pages of legislation. This should not strike any of us as if the government seeks to “conserve” anything.

Yet in these most unconservative times, it seems as though everybody is bending over backwards to claim the mantra of authentic Australian conservatism.

Kevin Rudd famously described himself as an economic conservative. One pillar of that conservatism was, apparently, a belief in balanced budgets. We’ll let belief through to the keeper, as he did. Another pillar was a belief in an independent reserve bank – a belief which every side of Australian politics shares and nobody had ever accused Rudd of doubting.

Tony Abbott is described – and describes himself – as the archetypal Australian conservative. Abbott’s views do tend to what we commonly consider to be social conservatism. He’s opposed to gay marriage – but not, importantly, homosexuality in general. That’s not unusual. Opposition to gay marriage is the norm in federal parliament.

But then he’s a long term supporter of workplace deregulation, which, however you look at it, is a repudiation of a system of industrial relations that dates back nearly to federation. Uprooting that system, for whatever reason, is hardly a “conservative” thing to do.

Ditto with the way Abbott, and the Howard government, sought to do it – to shift industrial relations powers from the states to the Commonwealth government.

In other words, further eroding the structure of government which we have inherited from the Australian founders.

Abbott has described the states as “Australia’s biggest political problem”. He has a plan to fix it.

Then there are the regular claims that the true “conservative party” are the Greens. This has a hint of truth to it, beyond the simple linguistic relationship between the word conserve and conservative.

On Twitter the other day the state Greens MP Greg Barber wrote that he believed “we need a new political philosophy, where politicians see themselves as trustees, not liquidators of environmental inheritance”. In other words, politicians benevolently and selflessly safe keep the world for future generations – it is hard not to see the shadow of 19th century Toryism in Barber’s words.

A conservative in the 19th century was opposed to the free market Whigs who are the intellectual ancestors of the free marketeers who now describe themselves as conservatives.

Don’t worry – I’m confused too.

A conservative in Russia in 1994 was a communist. A conservative in Iran 2010 is a theocrat.

We describe evangelical Christians as “conservatives”, although in their enthusiasm, they are closer to the French revolutionaries Edmund Burke criticised than the sober masses he defended.

We describe the advocates of the invasion of Iraq as conservatives, although there is hardly anything conservative about invading a country, eliminating its leadership, disbanding its army, and just hoping democracy will spring forth out of the sectarian strife which results.

My point isn’t to say that conservatism is a meaningless word. But just to say that simply describing someone or something as conservative is fraught with difficulty.

Of course, we’re all guilty of this. Conservatism is a convenient cipher for a set of policy views and attitudes we associate with people who willingly adopt the word.

Conservatism is a discreet and specific philosophy.

There is a substantial body of political and philosophical literature which has defined and developed a conservative philosophy of government.

In fact, it’s almost a misnomer to call it a philosophy at all. Instead, let’s call it a disposition.

And, despite the contention of our friends in the affirmative, it is an exceeding rare disposition in Australian politics.

Certainly few in federal parliament could justifiably describe themselves as conservative.

Here’s why.

Conservatism is the anti-ideology. Conservatism has no political program. It is the only political movement that has no plan, no vision for the future, no picture in its mind of the ideal world.

In fact, it’s not really fair to call it a “movement” at all – a value system that rejects the idea that society should progress towards a goal can’t be described as moving anywhere at all.

Progressives imagine human nature to be mutable – that the way we see and react to the world is a symptom of environmental factors, and that as a consequence, that environment can be changed.

Conservatives see human nature as immutable – that there are constants which no planner could ever change. Some self-described conservatives may revere tradition, and place the cultural and social norms of the past on a pedestal, but “conservatism” – that is, the philosophy of conservatism – sees tradition as merely a reflection of these immutable truths.

The true conservative is not opposed to change. Changes occur, outside the realm of politics, and societies have to adjust to cope. Change can be regretted, it can even be restrained, but it should not be opposed.

“When it is not necessary to change, it is not necessary to change”, said the conservative Viscount Falkland who tried, and failed, to keep England from descending into civil war in the seventeenth century.

Change must be organic. It does not come from planners or idealists, but from below. The conservative believes it should come incrementally. It should be limited.

Just as conservatives resist visions of the ideal world, they resist plans to achieve that ideal world. The conservative intellectual Michael Oakeshott – and more than any other, Oakeshott is the modern go-to thinker for conservative thought, a genuine heir to Edmund Burke – gave the reasons for this as due to different types of knowledge.

There is knowledge that can be learnt – knowledge that can be contained in books, to be studied, to give us the impression that we have expertise in an area. Planners focus on this sort of knowledge. If we want to completely revolutionise a social institution, social science data must be studied, social experiments run, academic papers written, and conferences held to devise the perfect way to enact change. This is technical knowledge – like devising and reading a recipe from a cookbook.

But Oakeshott argued that there is other knowledge which planners cannot access. He calls this “traditional knowledge” – the knowledge inbuilt in those social institutions which planners are unfamiliar with. As we all know, following a recipe is easy. But if you do not have the knowledge built up from years of cooking – like how to cut vegetables, how to sift flower, what parts of the chicken to discard – your dinner may look and taste awful nevertheless.

It’s not just a matter of developing more complicated recipes. Much traditional knowledge resists being written down. There is no formula for speedy chopping – you have to build that skill up over years, learning the balance of your favourite chef’s knife.

Planners may be able to write the recipe for social change. But the recipe can never be comprehensive. And, a conservative would argue, if you have the hubris to completely redraw the contours of society, you’re inevitably going to make mistakes. You’re going to discard things which you might think are anachronistic, or out-of-date, but are, unbeknowenst to you, the foundations on which that society is huilt.

You might think that this sort of thinking forms the mainstay of Australia’s right of centre political thought.

After all, you’ve all heard the clichés about how governments cannot pick winners, and how government planning always fails.

Conservatives share a scepticism of central planning and government coordination with classical liberals, and economic rationalists, and radical libertarians such as myself. The writing of Ludwig Mises and Friedrich Hayek were devoted to emphasising  how little we know about what we think we can plan.

But Oakeshott’s conservatism and classical liberalism sharply diverge. For those economic rationalists which dominate Australian politics, on the left and the right, and the Hayekians which Kevin Rudd believed had hijacked the Liberal Party, are motivated by a vision of an ideal future.

Even if that future is white picket fences, and a small population – it’s still a vision. The ultimate rejection of Oakeshottian conservatism.

Nostalgia is not conservatism. Conservatism is about more than just pining for the past – it’s not white faces behind white picket fences.

And populism is not conservatism. There’s nothing inherently conservative about “Stop The Boats.”

All sides of politics are animated by a vision of future Australia, whether it’s a small Australia or a big Australia, a multicultural Australia or a ethnically-homogenous Australia, whether it’s an Australia focused on manufacturing or mining, on services or industry, on wireless broadband or fibre-optic broadband, or one where the government is more involved in the economy or less involved.

This is quite different from the conservatism described by Michael Oakeshott when he writes that:

To be conservative, then, is to prefer the familiar to the unknown, to prefer the tried to the untried, fact to mystery, the actual to the possible, the limited to the unbounded, the near to the distant, the sufficient to the superabundant, the convenient to the perfect, present laughter to utopian bliss.

In Australia, all sides of politics are searching for a plan for the future. All sides of politics are animated by a vision of a future Australia – one shaped by the economic, social and political reform they prefer. All sides of politics claim the mantle of economic modernisation.

So is Australian democracy too conservative? Obviously not.

Opening statement to Commonwealth Standing Committee on Environment, Communications, Information Technology and the Arts inquiry into the Broadcasting Services Amendment (Media Ownership) Bill 2006

As well as being a research fellow with the Institute of Public Affairs, I am the editor of our magazine, the IPA Review. The Institute of Public Affairs is a public policy think tank based in Melbourne. It was founded in 1943. We believe in small government, private enterprise, the rule of law, representative democracy. It is our position that any media reform should be clearly and unambiguously directed towards liberalisation and deregulation. We say this because, in cases where there are many potential or actual suppliers of goods and services—which is clearly the case in media—markets are far more efficient providers than government bureaucracies.

Technological and commercial innovation have provided Australians with a multitude of choice in the information and entertainment content we consume, the way we receive it and display it and our capacity to store it for future consumption. Therefore, any regulatory rationale based on assumed scarcity of media content or delivery mechanisms is no longer valid.

The IPA welcomes changes to media ownership regulations. The removal of foreign ownership restrictions is long overdue. Similarly, the removal of cross-media ownership restrictions is welcome. After all, millions of Australians each day already access foreign owned media through the internet. This access does not seem to have harmed us and certainly has not reduced the output of Australian produced and managed media. However, we believe that the proposed reforms do not sufficiently tackle the problem. Given the wide variety of choice available to Australians, we feel there is no longer any convincing case to maintain media-specific competition and ownership regulations. Instead, the government could better rely on the general economy-wide merger and ownership regulations to ensure competition. The ownership of media assets is no more sensitive than the ownership of, say, railroad assets.

While we welcome the release of two new television stations, we regret the imposition of regulatory requirements on both A and B. There appears to be no justification for these restrictions. They merely represent the elite imposing its preferences on consumers, and government technocrats seeking to impose their preferences on the way technology develops. Unfortunately, these provisions illustrate clearly that the lesson has not been learned for centre of government failure in introducing new media technology. We strongly oppose the imposition of any regulation which attempts to enforce local content requirements, plans or anything else on regional or rural media services.

In conclusion, the government has been presented with an opportunity to genuinely reform this regressive regulatory framework that the Australian media has been burdened with for over a century. This reform package makes a few minor adjustments, however its practical effect is not as large as the public debate has made out. Furthermore, in many areas it represents a significant re-regulation of the sector. This does not mean that the reforms are without value. The removal of the cross-media ownership restriction, as absurd an ownership restriction as can be imagined, is welcome, as is foreign investment deregulation. Adjustments to the digital transition are long overdue. The package needs significant revision. However, the need for reform is clear and should not be abandoned. It is less bad than the status quo.