CHAPTER 5
With public sentiment, nothing can fail; without it nothing can succeed. Consequently he who moulds public sentiment, goes deeper than he who enacts statutes or pronounces decisions. He makes statutes and decisions possible or impossible to be executed.
Abraham Lincoln, 12 August, 1858
Politicians can and often do lead public opinion, but they only rarely contribute significantly to the ideas with which they do it. Those few who have fancied themselves as intellectuals have generally made poor statesmen, even dangerous ones. The pollie should be able to understand abstractions but original thinking is a specialist's pastime for which he has neither the time nor temperament. He hears endless criticism but surprisingly few of his critics even try to take a nation-wide view of whatever it is that they are deploring this week. Most of the advice upon public policy coming from the "experts at the coal face" is so dominated by self-interest that it is worse than useless -- it is the principle source of corruption of political processes.
Some time in 1978, a colleague sitting beside John Hyde in an aeroplane was reading the proceedings of the first seminar of the Centre for Independent Studies (CIS). Hyde had been told that CIS shared the rather unpleasant "right wing" views that were prevalent in Sydney at the time and he had dismissed it without further inquiry. Hyde was, nevertheless, so struck by the liberality of what he read and the competence with which the arguments were marshalled that he arranged to meet its director, Greg Lindsay. Because Hyde believed that the Government he sat behind was ducking the hard issues his need for informed, reasoned criticism from people of liberal persuasion was already apparent to him.
This chapter concerns the dry think tanks established to lead public sentiment in the classical-liberal, dry direction. The Swedish economist and politician Gunnar Myrdal discussed the influence of thinkers upon politics in these terms.
Politicians must develop a relish for living intensely in the present moment and letting its accidental constellation of circumstances dominate their perspective. ... In general, political leadership in a democracy implies keeping oneself at the head of the flock wherever it is drifting. ... The honest and responsible politician ... can contribute greatly to the raising the intellectual level of the public ... but the steady pedagogical urge to rationality in political questions must be provided largely by people who have their status independently of the general public. ...
... in the institutional set-up of modern democracy ..., a function most important for its survival and growth falls on the social scientists: the long-range intellectual leadership thrusting society forward to overcome primitive impulses and prejudices and to move it in the direction of rationality. Our independent status should not be merely a personal pleasantness and distinction; it should be used as a basis for exerting influence over the development of the thinking of the general public. ... (87)
Although commonly referred to as "think tanks", there is an aspect to them that is more important to this story than their original thinking: they carry briefs for the general interest against the specific and for freedom against collectivism before the court of public opinion. Although most are academics, the advocates who find their ways to them mark their success not in footnotes but in improved public policy. They are change agents.
Although most authors and nearly all the think tanks eschew political party affiliation, they play roles in the great game of politics by its rules. Politics, properly conducted, is an honourable pastime but nearly all the think tanks, nevertheless, protest that they are not political. They mean not party-partisan. Most of them in fact carefully cultivate individuals from both sides of political chambers, being fairly careful to maintain a balance.
Their publications, which sometimes tackle the toughest political issues such as indigenous policy, are not found just in unread academic journals. They are as widely circulated as funds permit, and are written in language that laymen appreciate and in terms relevant to the formation of public policy.
The dry think tanks share a philosophical preference or, as opponents contend, a bias. Their "bias" is, however, explicit. It is preference for personal freedom, legal equality, abhorrence of privilege and for time-tested social values. Those who run them are professional recognising the same standards and using much the same techniques. Before proceeding to the record of particular think tanks something can be said about what they have in common.
THE MONT PELERIN SOCIETY
In 1947 a group of 39 from 10 countries met in the Hotel du Parc at Mont Pelerin near Vevey in Switzerland to discuss liberalism and its decline, the possibility of a liberal revival and the desirability of forming an association of people who held their convictions about the nature of a free society. (88) The initiative was Professor Hayek's, then at the London School of Economics. Hayek was a leading figure among the "Austrian school" of economists and author of The Road to Serfdom. He was to receive a Nobel Prize in 1974.
Although the war had discredited Fascism and National Socialism, the underlying tenet of those doctrines, namely, individual subservience to the State, then had upwards of three decades of comparative popularity to run. Individual liberties were being swept away in the newly Communist states and gradually eroded by intrusive Governments in the democracies. The collectivist trend had seemed inexorable even to those who opposed it.
Ultimately the weight of socialism's manifest failures contributed more to its downfall than did scholarly debate. Nevertheless, the persistent, if uneven, rise of liberalism during the final quarter of the century cannot have been written in the stars, barbarianism has lasted longer than civilisation. Who knows for how long, in the absence of the well-articulated liberal alternative, governments would have persisted with public ownership and control of the means of production, distribution and exchange? Who can say what new doctrine promising heaven on earth might have been tried, or what atrocities might now be being committed in its name? In any event, the encouragement and intellectual exchange of the Mont Pelerin Society played an important part in formulating critical review of all forms of socialism and in promoting the merits of freedom.
The idea that no one should be trusted with the authority to enforce a better world upon the rest of us had to be explained, given relevance to immediate concerns and popularised. To this end, a considerable network developed. The Mont Pelerin Society's role in this has remained much as Hayek envisaged -- a forum for some of the world's best minds in the social sciences. Its members have included an impressive number of Nobel Laureates. Australians are disproportionately well represented among the MPS's elected members. Using the staff of the Centre for Independent Studies they have run three regional meetings, one in Sydney (1985), one in Christchurch (1989) and another in Bali (1999). Greg Lindsay, is currently a Vice President.
The Society, not formally but in practice, has been at the apex of a conscious effort to propagate the liberal ideal. At its 1996 biennial plenary conference, privatisation and competition could be discussed in papers delivered by hands-on political leaders from the Russian and Czech Republics. It inspired people at hundreds of think tanks throughout the Western World. Some of these were particularly interested in the Austrian approach to social policy with its emphasis on institutions that protect individual freedom and that help people discover useful knowledge. This contrasts with the neo-classical approach of mainstream economic and sociology emphasising aggregate welfare within the bounds of current knowledge. However, as both approaches abhor privilege and Governments that knowing what they ought to do did something else (political corruption), the differences had far less relevance to the conduct of "the good fight" in Australia than what they had in common.
PROFESSIONAL ADVOCACY
The Atlas Foundation (of which more below) has encouraged these think tanks, and importantly it has inculcated the few rules that keep liberal/conservative/neo-conservative/neo-liberal/free-market/dry advocacy objective, influential and out of trouble. (The terms tend to be country-specific.) The rules bear repeating:
- The aim is to change the climate of opinion by argument alone. Affiliated organisations should not therefore become involved in political power plays, or offer advice that is not on the public record.
- Sources of funds should be numerous and diverse enough to ensure that advocacy is not beholden to funders. Particular care should be taken not to become beholden to Government finance.
- So far as is practical, rigor should be maintained by independent research committees and the practice of appointing referees for publications.
- Advocacy must serve the public interest, not some narrower interest such a political faction, the business community, farmers or trade unions. In practice the relevant publics have tended to be defined by national and, for some of the smaller tanks, state boundaries.
The temptation to break each of these constraints is ever present. Nevertheless, conversations with people working within the Atlas affiliates convinces me that the first three "rules" are normally complied with. However, it should be admitted that the three major Australian dry think tanks each broke the first rule by coming out against the Joh-for-Canberra Campaign. In this context John Hyde reported saying that "[liberal policy tanks'] greatest danger comes not from opponents but from Genghis Khan types who think they may be our allies".
The fourth is more difficult to assess. People do not always agree upon what policies in fact advance freedom and the public interest, and nearly every vested interest, upon finding that its privileges are challenged, will accuse its critic of serving some other vested interest. The most common accusation is that the institutes serve business interests even though that accusation is difficult to reconcile with their consistent advocacy of competition and opposition to tariffs, subsidies and tax breaks. ABC television once accused the Institute of Public Affairs of being beholden to a mining company that had declined to provide it with a cent. The ABC journalists based the accusation on the easily-filmed miner's logo in front of the building in which both the IPA and the miner were tenants.
Sir Antony Fisher, a Battle of Britain pilot, survived World War II to become convinced that Britain was heading down the same collectivist path that Hitler would have taken it -- albeit without resort to murder. He raised his fears with Hayek who convinced him that the only feasible insurance was to win the public debate. It was all very well, said Hayek, for people like himself to meet periodically as they had at Mont Pelerin but liberalism's virtues must be expounded to a far wider audience -- dealers in the ideas that he and others like him developed were needed. Hayek advised Fisher to spend his money not on trying to influence politicians directly, but to invest in a think tank that would, by reasoned argument, make the case for economic freedom to the general public.
Fisher, who had first made quite a lot of money farming poultry, then devoted much of it and his time from 1955 onwards to founding the London-based Institute of Economic Affairs (IEA). It was to do more than anything since the Battle of Britain to save Britain from collectivism. Under the Directorship of Ralph Harris and Research Directorship of Arthur Seldon its authors were to provide the ideas that 24 years after the IEA's formation sustained the Thatcher revolution.
Think tank directors in many countries today still regard the IEA as archetypal. It avoided political party involvement, concentrating on influencing the intellectual climate alone. Its hundreds of publications were written by academic economists but were short -- seldom more than fifteen thousand words -- and addressed to a lay readership. Harris was a brilliant publicist, Seldon a brilliant editor. Publication titles ranged through Unemployment and the Unions, Paying for Social Services, Resale Price Maintenance and Shoppers Choice, Financing University Education, Advertising in a Free Society, Picking Winners, Denationalising Money, Monetary Policy for Stable Growth etc etc etc. By their rigour alone these won respect for the Institute and the ideas. Thus faith in collectivism was worn away from its more vulnerable edges.
When the IEA was well established, Fisher turned his attention to the role of ideas in the future of other countries. He next assisted in founding the Fraser Institute in Canada. Then, with the Institute of Humane Studies of the United States, he formed the Atlas Foundation, and that assisted with founding liberal institutes in many countries, some of them much less free than Britain or the US. The IEA thus became the model for many other liberal think tanks mainly within the English speaking world, Latin America and latterly Eastern Europe.
Organisations, such as the Fraser Institute, American Enterprise Institute (AEI), Heritage Foundation, Cato Institute and Australia's CIS have international reputations but most do not. Some have annual budgets twenty times greater than the CIS, but again most do not. There are now more than 40 in Latin America alone. To varying degrees each differs from the archetype. A very few, such as AEI, undertake original research which would grace the best universities. Many specialise in areas such as local Government, state Government, economic issues, ethical issues or the relevant local community. The Acton Institute, for instance, concentrates on getting socialism out of the churches and morality back in. The raison d'être of each is, by public argument alone, to bring about a freer society with less entrenched privilege.
Conspicuously brave people have managed a few. I once asked a tiny but fiery little lady who with her husband ran one of the South American organisations how she could be sure they did not over-step the unclear mark set by the dictatorship they preached against. As nearly as I can remember, she replied, "Richard, we can't, but we keep the tickets current and the kids will be in Los Angeles before the bastards catch them". She did not convince me that that was all there was to staying out of gaol but she silenced me. I still get a lump in my throat when I think of her.
Before describing professionalism in the ideas-propagation game, however, an inevitable accusation needs an answer. Are not the dry advocates, like advocates for a socialist society, trying to mould society to their own liking? To achieve a particular form of society, yes; but to "mould" it, no. They seek only such influence as may be gained in the forum of public opinion where their ideas cannot escape being tested against opposing opinions. Of course, many advocates of the opinions they oppose accept the same discipline. The dry advocates are, however, distinguished by arguing against the accretions of authority by which societies can be engineered.
Think tanks risk a form of political failure that reminds me of the charge of the Light Brigade: "C'est manifique, mais ce n'est pas la guerre". The field of public affairs is crowded with policy wimps but there are also the empty horses of those who choose glory over success. The only legitimate weapons in "the good fight" may be words but, like all warfare, its only reasonable goal is victory -- in their case the voluntary acceptance of their ideas in a very competitive market. Bruised opponents and pedantic demonstrations of superior intellect may be satisfying and even earn glory among the cognoscenti, but those who need persuading are likely to be merely irritated. At all levels of the intellectual debate, arguments need to framed to convince those who do not already share the opinion, not to amuse those who do!
Unlike policy wonks, a reasonable man spends little time on political issues. Getting but one vote in millions and that for a package he cannot divide, he is "rationally ignorant". The way to get to our reasonable man, to the extent that one can get to him, is through the values he already holds. People encounter a political proposal and quickly assess whether the reform idea seems to advance or threaten their core values, and support or reject it accordingly. A values-based (rather than a facts-based) marketing strategy is called for. There is not much that policy promoters can do to change people's values but they can, and to succeed must, link their policies to other people's values. Fortunately, core-values are nearly universal.
Dries too often fail to explain how or even to assert that their penchant for liberty benefits the elderly, children, aborigines, the ill and the disadvantaged generally. Rationally ignorant voters may, therefore, dismiss their arguments without even taking them aboard, let alone considering them. The advocate who is unwilling to seek out common ground and base his arguments upon it will never be effective. People who have employed sound arguments while not bothering to understand the people to whom they ought to be speaking have not been persuasive. To get their prescriptions right, successful advocates need hard heads but, if their hearts are not seen to be as soft, they will not be heard. Those who either don't have or have hidden their soft hearts more than waste resources; they create opportunities for ideological and self-serving opponents to portray the arguments, the advocates and their organisations as objectionable. Then people dismiss the sources without bothering to check, as I once dismissed the CIS!
One does not associate with these think tanks to get a PhD. I once heard Milton Friedman refer to the Institute of Economic Affairs as a "dealer in second-hand ideas" an expression first employed by Hayek. He got Arthur Seldon into a bit of lather and he was not wholly correct, IEA authors had applied standard theory to problems in ways that were indeed original. Nevertheless, Friedman had identified the essential, if not the only, feature of organisations such as the IEA. In the political game, unlike the academic, it is more important to be correct than to be original and much to be gained from sound argument oft repeated. When one takes on well-financed vested interests it does not pay to be wrong about anything.
The dry think tanks are, therefore, no places for wild-eyed visionaries but, as good cooking attracts blowflies, they attract them. To minimise the risk of squandering credibility, well run public-policy foundations in the more controversial policy areas tend to advance policies that are supported, at least, by well-established theory and appoint Boards of experienced practitioners to offer guidance. Wherever possible they prefer to be able to claim that their recommended policy or something like it has been tried elsewhere and it worked. However, they cannot afford to be dull. A capacity for lateral thinking can be valuable and the quick shot from the hip can be effective, if risky.
While running a think tank, the AIPP in Perth, for two years John Hyde was able without a calamity to participate with the late Jack Marks, a notorious Lefty, in a weekly radio chat show. The issues flowed fast, were not predictable and were chosen to be contentious. Hyde tackled the trade union movement, the Labor Party and the Liberal Party in damning terms. Perceived and real errors, if only of emphasis, were inevitable and unsupported assertions flew about. One reason that Hyde believes he got away with shooting from the hip when debating Marks was that Jack and John would, amid serious discussion of an issue, keep up a steady banter, much of it very politically incorrect. They got hey-come-off-it calls from listeners, but Hyde can't recall one that was angry and an experienced radio announcer once enthused to him how wonderful it was to have such "civilised disagreement" on air. It wasn't civilised in any sophisticated sense, just fun. Yet, for what the feedback was worth, it did more for his Institute's standing in WA than any other activity. Perhaps also, people who take themselves too seriously make poor advocates. If you are going to dish it out in the party room, the press or anywhere else, you've got to be seen to take it smiling.
The public can smell hypocrisy, class attitudes and self-interest in the most innocuous press release. The problem is obvious: one's own prejudices are the hardest to see as such. It is without complete remedy but a well-chosen panel of referees vetting publications certainly helps.
Finally, although others do influence the long-term climate of opinion by using impact advertising, (89) it costs millions that dry think tanks do not have. Therefore, their messages must be targeted initially to people who will repeat them -- media, politicians, business corporate affairs departments, those CEOs who give tongue, church and union leaders and the ideas network itself.
Since everyone may "free-ride" hoping others will put up the money to protect the liberal society, the think tanks' arguments, like all "public goods", are hard to finance without access to taxes.
THE I.P.A.
Once it became probable that the Allies would win World War II, far-sighted people thought about the Australia that would emerge from it. Chiffley's "Light on the Hill" and Menzies' "Forgotten People" speeches in due course reflected their concerns. However, well before those public expressions of conflicting aspirations, in 1943 the Institute of Public Affairs (IPA) had been formed to influence post-war reconstruction. It predated the Mont Pelerin Society.
At the time, we had a heavily regulated war economy. Many commodities from butter to petrol were rationed and there was a highly prescriptive manpower policy. There was also an active black market. The Great Depression had not long passed and Australians were determined, if at all possible, never to go through that again. The USSR had been a brave ally, and socialist, utopian idealism was fashionable. Wartime propaganda had encouraged faith in Government that does not exist today. The spirit of the times was without doubt collectivist. George Orwell, writing from Britain in Partisan Review, Winter 1944, of the attitudes of intellectuals to the war and post-war aims, did not list one who held that the survival of capitalism was both possible and desirable.
Many Australians believed that the wartime powers could and should be employed to build a better nation. The Labor Government, in power in Canberra throughout the major part of the war, had made no secret of its adherence to socialist principles that are today discredited. The Non-Labor parties in Canberra lacked core principles and were in serious disarray.
C.D. (Ref) Kemp, the first director of the IPA in Melbourne, had worked as a personal assistant to Sir Herbert Gepp who had been instrumental in the Institute's foundation. After the 1943 election, the Victorian but not the NSW IPA eschewed party political activism to concentrate on a didactic role.
In 1943 Kemp wrote to a member of his Council:
The political back-biting and sniping is not for our organisation. Leave that to the people who have always done it. I have always looked on the job of the Institute as being to make a really worthwhile contribution to thought and action in Australia. There is plenty of room for it, God knows. The "sex appeal" methods of business have always failed and will fail again. We want something more solid and enduring.
Fifty-nine years later, that is the opinion of tens of thousands associated with hundreds of similar organisations.
The Victorian organisation, however, had close links with protected industry that it was not to shake off until the 1980s. Sir Walter Massy-Greene, who had championed protectionism in Federal Governments before 1922, was a member of its founding Council.
In October 1944, the IPA published Looking Forward. This one publication, written by Kemp with guidance from a committee of industrialists and bankers, on the broad face of the evidence at least, had profound influence on future national Governments. Fifty thousand copies were circulated that proposed public policies which, while sufficiently consistent with the beliefs and aspirations of the time to gain acceptance, would preserve the free enterprise system.
At the time, The Bulletin described it thus:
It is by far the most comprehensive and intelligent set of inquiries and recommendations concerning post¬war problems that has yet been published by any similar body or government department.
Menzies wrote to Kemp:
Last night I read Looking Forward of which I understand you are one of the principal authors. It is in my opinion the finest statement of basic political and academic problems made in Australia for many years. I feel most enthusiastic about it and would like to see its substance conveyed to the people as widely as possible. ...
Looking Forward was able to set the terms of the debate because it appealed to values that were already widely shared. In an obituary published in IPA Review following Kemp's death in 1993 Shaun Kenaelly had these things to say about it. They give the flavour of the publication:
Looking Forward makes the case for independence of business; clears up confusion on the questions of prices and profit; argues strongly for individual responsibility and initiative and speaks directly of service as a managerial ideal. It warns of the dangers presented by monopolies, but points to the special advantages flowing from large-scale industrial aggregates. It does not neglect small business. It suggests that restrictive trade practices bring both bad and good, urging for close public scrutiny. But trade unions, it says, are also restrictive. It is not hostile to the state but argues for very clear lines between what governments should attempt and where they were being intrusive.
When assessed against the practices of the governments of most western countries in the 1990s, Looking Forward was far from dry, indeed it is in many ways corporatist, but, assessed against the worldwide opinions of its time (90) and calls for nationalisation in Australia, (91) it was drier than the alternatives. Because of its high quality, its timing and the care taken to appeal to the aspirations of a war-weary people, it influenced the policies of the fledgling Liberal Party with which the Victorian IPA declined formal association, appealing to the public over Menzies' head.
Success has a thousand fathers, and the IPA's central role has been questioned. But the argument that the IPA lacked direct input to those who wielded power is not relevant. The IPA did not need that input and eschewed it. What cannot be denied is that the ideas it espoused in the forties prevailed during the fifties. Many appeared verbatim in the 1945 Liberal Party platform. Ref Kemp's son David tells us that "The general tone of the suggestions adopted [by the Liberal Party] stressed a democracy 'in which the common interest will be preferred to particular interests', be they trade unions, capital, the land, manufacturing industry, or returned service men." (92) Subsequent Coalition Governments and the IPA itself was to fall under the baleful influence of Victorian manufacturers but, bearing Massy-Greene's influence at the IPA in mind, the statement itself is a remarkable declaration of the principle that Government stood above sectional interest for which Kemp must be given the lion's share of the credit.
By 1985 the Sydney IPA had an annual budget of $120,000 and the Melbourne IPA $300,000. The Melbourne IPA, which had in the intervening years gone through periods during which its influence was minimal, was over the next five years, under the Directorship of Ref's younger son Rod, to take off both intellectually and financially. From that time forward it preferred the common interest to the particular with vigour that dismayed some people from protected industry and some of the Melbourne establishment.
It amalgamated with the AIPP in 1991 and with the Tasman Institute ran Project Victoria that was to have considerable influence on Government in Victoria under Kennett. (See Chapter14) In The Kennett Revolution, Rosemary Kiss accused the Kennett Government of "... pursuit of an agenda drawn up at least in part by a think tank operating on behalf of business interests." (93) The IPA denied that many of its recommendations could be said to have favoured business (particularly in Victoria where so much of it was protected) but it welcomed the affirmation of its influence.
Throughout most of its 58 years it had published Facts, presenting reliable data from conventional sources, often demonstrating that the world was not as portrayed. These facts became the bases of many political and business addresses. By the 1980s it was also producing IPA Review, a magazine arguing the dry point of view, and Backgrounders offering more involved argument on current public-policy issues.
In the mid-1980s it set up a States Policy Unit in Western Australia. This concentrated on State Budgets and built a reputation such that its opinion on State Government fiscal matters was regularly sought. Each year it identified the best and worst State budgets. When the Field Labor Government in Tasmania was praised in consecutive years for the most rigorous budgeting and used the commendation in political advertising a discipline had been imposed on all State budgets. South Australia, twice awarded the lemon, even made noises as though it might sue. Of course it would not: even if a plaintiff could be identified, no Government would court such adverse publicity but, just in case, John Hyde advised them of a long list of the nation's economists he might bring as witnesses.
By the 1980s the public had become heartily sick of schooling that did not educate and the IPA had little difficulty finding funds for an Education Unit. It gathered data and horror stories on the effectiveness of curricula and teaching such as the New Wave Geography, a Victorian schools textbook, that told children that people in the USSR had more than enough food while about half of USA and Britain were areas of severe under-nutrition. It brought international authorities to Australia.
In 1993 it published Black Suffering White Guilt?. This questioned whether continued Aboriginal disadvantage could be explained in terms of "racism", particularly the then popular concept of "institutional racism", and the wisdom of collectivist policies that assumed that Aborigines were all the same but dissimilar from other Australians. It was I believe one of the most difficult papers produced by an Australian think tank but also one of the most influential.
The Sydney IPA ceased activity in the late 1980s with much of its resources going to the Sydney Institute. It does not have an overt philosophical commitment but it contributes to the quality of public debate with effective speakers' forums.
Since Rod Kemp's time the Melbourne IPA concerned itself with the here-and-now of public policy formation. It has taken on the tough political issues such as budgetary incontinence, indigenous policy and the Victorian educational curriculum. It has not been as given to lofty statements of general principle as most dry think tanks. The Centre for Independent Studies has in contrast relied more on articulating general principles taking a longer-term more philosophical approach to reform.
THE C.I.S.
Following his discovery of the CIS, John Hyde was introduced to Greg Lindsay by Austin Holmes. Later with Jim Carlton and Peter Baume he had called on Lindsay again. He did not then seem to them to have the standing and presence to do in Australia what the Institute of Economic Affairs was already doing for liberal ideas in Britain. Lindsay did not wear his extraordinary strength of purpose and courage on his sleeve.
He had founded the CIS in 1976, in the wake of the illiberal excesses of the Whitlam experiment. At first operating from the garden shed of his home, its brochures proclaimed that it existed to develop and promote "ideas supportive of a free, open and prosperous Australian society". By then the issue had become the considerable gap between the Fraser Government's sometimes-liberal rhetoric and its performance.
Like other liberal public-policy institutes, it set out to change public opinion by commissioning and publicising studies of policy-relevant issues from the perspectives of liberal economics, politics and sociology. It has also sometimes drawn on the insights of the philosophy of ethics. Its publications are mostly less than 100 pages, readable and rigorous. Referees review the papers before publication is considered and a committee of academic advisers, several with worldwide reputations, lend their standing to them. From the CIS's earliest days, Lindsay was able, without the funds to pay anything but trivial fees, to induce academics of the highest standing to write for him. It subtracts little from his remarkable achievement to observe that some of his authors must have been frustrated by their inability to reach the public and policy making elites via the academic literature.
A Board governs the Centre but it was Lindsay who built it. It is fiercely independent, taking no money from Government and only from such diverse private sources that none by threat or promise can influence the opinions expressed. It operates today on an annual budget of about $1.6 million with the larger part coming from private subscriptions rather than those of large corporations.
No description of free-market think tanks could convey their flavour better than Greg Lindsay's own account of how he formed the CIS, first published in interview form in the CIS magazine Policy. His concern about the state of Australia, the books and people who most influenced him, the procrastination and initial difficulty in getting financial backing, his preparedness to live poor while this was done, his determination to erect the "Chinese Walls" that would insure his independence, the support of like-minded academics, the esprit de corps and the networking are all typical. Nothing was more important to its success than Lindsay's determination.
Greg Lindsay:
During 1974, I saw an article in The Sydney Morning Herald which sparked my interest. The article was an interview with a young engineer, Bob Howard, who had an Ayn Rand discussion group which he ran in his flat in Glebe. He had thousands of books and I came across then ideas I'd not heard of. I decided when I began teaching to go back to university to do philosophy and formalise my thinking. I studied philosophy part time at Macquarie, focusing on John Locke, David Hume, Adam Smith andpeople like that. Bob Howard's discussion group was the genesis of the Workers Party which had a shortbut prominent life, mostly in 1975.
I think I started subscribing to Reason magazine in 1974 and began to buy a lot of books from the Foundation for Economic Education in New York. My first copy of The Wealth of Nations came from there, as did Milton Friedman's Capitalism and Freedom and Hayek's The Road to Serfdom. I came across an organisation called the Centre for Independent Education in Kansas which reinforced some of my thinking about school education -- an abiding interest of mine. During the summer school holidays atthe end of 1975 I decided to go visit these institutes in the US. From Kansas I went to New York, where I met the economist Murray Rothbard. I recall helping him and his wife stuff envelopes on their living room floor, thereby starting a lifetime career.
In 1975 the political turmoil continued. One of the things that annoyed me at this time was that commentators in the media always thought that Government was the solution to the problem. I thought "No, it's not". We could see that the Labor Government was not governing at all well, and I had not been impressed with the previous Coalition Government. By this stage my own reading had made me think that there had to be a better way of doing things.
Interviewer:
But thousands of other people would have had similar ideas, but not gone on to found think tanks.
Greg:
I was always a doer. I was involved in the Scout movement for much of my youth. I ran a verysuccessful Venturer Unit in my early twenties. I was always able to mobilise people. I helped set up the most active branch of the Workers Party. We ran Bob Howard in the Berowra electorate in 1975, and from memory got 12 or 13% of the vote, which was very high for a minor party.
People used to ask Ralph Harris [now Lord Harris of High Cross], founding General Director of the Institute of Economic Affairs in London, how he came to be as he was, and he used to say that he was one of the awkward squad. To him, that probably meant that he would see something and think it was not right, or he would go counter to what was going on. There was something in my make-up that made me think about things differently from my friends.
During 1975 I had read Hayek's essay The Intellectuals and Socialism, which in one sense was the most important piece that I'd read. It made me realise that what I was seeing was an intellectual problem, not a political problem. After I came back from America, and having thought more about the role of ideas in politics, I decided to get out of the Workers Party, and set about trying to establish an institute.
In thinking how the think tank should work I only had a few models, but knew that academic supporters would be vital. I read in Quadrant a review of Robert Nozick's Anarchy, State and Utopia, a book I'd recently read. [It had been reviewed] by Lauchlan Chipman, then a Professor of Philosophy at the University of Wollongong, and I wrote a letter to him. I told him what I was planning to do. I came across another academic John Ray, who had edited a collection, Conservatism as Heresy, and I organised a seminar in October 1976 at Macquarie University with Chipman and him as speakers. Chipman gave a paper that we subsequently published as a CIS Occasional Paper, Liberty, Justice and the Market. Ray gave a paper on notions of freedom.
During 1976, I learned that Antony Fisher was coming to Australia. By this stage I had found out more about the IEA and discovered that it was he who had the original idea for the Institute, following a discussion he'd had with Hayek in the early 1950s. He and a group of people were trying to start an IEA-style think tank in Australia. I thought "Oh damn it, just when I was starting my own think tank." He addressed a few meetings and I found out that he was staying at the Wentworth Hotel in Sydney, and that the fellow taking him around was John Bonython, who was to be very helpful in the years to come. I spoke to them both. Fisher wished me luck.
Lindsay was making the contacts he would need.
On his second visit in December that year, I went to a meeting he addressed in Mosman, and happened to sit next to Maurice Newman. It transpired that Newman had brought Milton Friedman to Australia in 1975 and had been invited by Friedman to attend a meeting of the Mont Pelerin Society, an international society of classical liberals founded by Hayek in 1947.
Meeting Maurice was one of those important points in the history of the CIS. Another was meeting Ross Parish, then a Professor of Economics at Monash University. Ross had bought some conference papers from a conference I'd organised at Macquarie University in April 1977 and I went to see him on a trip to Melbourne later that year. Other early connections came with Sudha Shenoy at the University of Newcastle, Naomi Moldofsky at Melbourne University, Warren Hogan and Colin Simkin, both at the University of Sydney, and Michael Porter at Monash. Out of these various meetings came a conference, held also at Macquarie University, in April 1978.
The theme for the weekend meeting was "What Price Intervention? Government and the Economy". Participants included Porter, Hogan, Parish, Lachlan McGregor, Peter Samuel, and Ted Sieper, and we also decided to try to get Alf Rattigan. Rattigan agreed and was the after dinner speaker.
Greg needed publicity.
A hundred people turned up, including Paddy McGuinness who was at the time Economics Editor of the Australian Financial Review. The next Tuesday, Paddy wrote an article in the AFR, "Where Friedman is a Pinko", giving my phone number and address. We had days of messages.
Interviewer:
What were all these people responding to?
Greg:
I think a lot of them were glad that at last people were taking some of these role-of-Government issues seriously. We were trying to discuss the costs of Government and provide some answers. We sold hundreds of copies of the conference papers. We set out to maintain a high academic standard, and were successful on the first real test.
The immediate follow-up was that the IEA group, and particularly Derek Sawer at BHP, began to take us seriously. They decided that perhaps there was no point in pursuing an institute of their own and invited me down to Melbourne. I flew down in May (school holidays) for a lunch. They were mostly economists: John Macleod, John Brunner, Sawer, Mike Porter, Doug Hocking, Ross Parish, and some others from companies including Bruce Kirkpatrick from ICI. I talked about my vision, and everyone was agreed that the CIS should be supported. But nothing happened.
Greg soon discovered something that most pioneers learn. Despite the many people with good intentions, his enterprise would depend on him.
I resolved that nothing would happen unless I kicked it along myself, so I took leave without pay from my teaching job at Richmond High School during 1979. Two of my earliest supporters, Neville Kennard and Ross Graham-Taylor, provided some financial support, so I was not entirely without income. Perhaps more importantly, my future wife, Jenny, who I had met when she was in university, was now working and this made taking the risk much easier, though I don't think her parents viewed me as much of a prospect for their daughter.
Sitting in that backyard shed in Pennant Hills wondering what on earth I was doing was an interesting time. I got to read a lot. There were a number of key events that year that were critical. Most of them revolved around people. For instance, the establishment of the Australian Graduate School of Management brought us Ray Ball and Malcolm Fisher who became active in the Centre in the years ahead.
Hugh Morgan was a part of the IEA group, but I had never met him. I figured that he was a key individual. I rang him up and said that I'd like to come down to Melbourne to see him as I thought this institute business was stalled and it was time to stop the talk. I flew to Melbourne, either the next day or the day after, and he said let's not muck about on this any longer. He rang up some people and got seed money commitments amounting in total, once others came in, to about $40,000. This was committed per year for five years. We had our, albeit small, funding base and in 1980 moved to St Leonards where for 10 years the CIS, atop Uncle Pete's Toys, set out to build its reputation and pursue its mission.
The diary John Hyde kept during the final four years of his parliamentary term records several meetings with Lindsay and CIS people. By 1979 the CIS and the Dries in the Federal Parliament regarded each other as effective allies in a common cause that had nothing to do with party politics.
THE A.I.P.P.
Shortly before the 1983 election, Bill Clough, youngest son of Perth's leading civil engineer, Harold, approached John Hyde to seek advice upon who might run a free-market think tank based in Perth along the lines of the Heritage Foundation in the United States. He, his sister Sue and his father would back it. Hyde told him he was about to lose his seat although he is sure Clough knew as much already. Late in 1983, they formed the Australian Institute for Public Policy (AIPP).
Hyde copied the CIS's legal structure (Greg Lindsay had copied a bowling club) and its methods before heading for further instruction from the 1983 Atlas Foundation meeting in Vancouver. AIPP's budget by 1985 was only about $80,000 but this was expanded to over $400,000. Taking its style from the Heritage Foundation, it concentrated more than the CIS upon immediate policy concerns employing short pamphlets and making media comment.
Many people call for smaller Government and for lower taxes but few will say what Government programs they would cut. From 1985 until its amalgamation with the IPA in 1991, infuriating several vested interests, AIPP published the cuts that would allow Federal budgets to be balanced without increasing taxes. It twice made similar recommendations for the Western Australia.
Like Heritage, they tried to set agendas by stating what interpretation should be placed upon impending reports and political decisions. Their success was mixed but in 1985, before the release of the Hancock Report on industrial relations, they published a paper asserting the issues that it should address. BRW covered the publication in detail and in that case, either they influenced the report's media reception or they anticipated to an extraordinary extent what commentators already believed. The media decried its failure to address the issues that they had raised.
In June 1987 the AIPP published a short paper titled The Forgotten Issues. It deplored the emphasis on taxation to the exclusion of serious debate about expenditure and the more important supply-side issues, trade, the labour markets, transport and communications. Another of the more successful publications addressed Australian grain-handling (94) concluding that in a deregulated environment Australian grain-growers would be $10 to $20 per tonne of wheat better off than they were.
In 1988, in co-operation with the Australian Chamber of Commerce, on a $100,000 budget that was not quite raised, AIPP produced Mandate to Govern -- A Handbook for the Next Australian Government -- of whatever party. The idea was copied on a smaller scale from The Heritage Foundation's Mandate for Leadership that is reputed to have had a considerable influence upon the Reagan Administration. They kept a white board prominently displayed upon which Government action and Opposition promises to implement its recommendations were recorded.
The early (and, for want of experience, least well done) proposals for budget outlay and tax-expenditure (95) cuts received wide publicity and on one occasion the Department of Finance graciously asked for copy. I doubt that their list contained a single item that the Department had not already considered but their publication should have done something to convince the public and some backbenchers who would never see a Treasury "hit list" that budget cutting was a realistic option.
AIPP opened a Canberra office run by Sir William Cole, an ex-Secretary of the Department of Finance. He improved both the quality and credibility of their budgetary recommendations. In 1990 he produced a list that included: changing health insurance arrangements to encourage the wealthy to pay more of their own way (saving $800 million); reducing university grants while encouraging the institutions to charge modest fees ($400m); tightening the administration of AUSTUDY ($47m); cutting aboriginal affairs spending by 5% ($25m); recovery from farmers of 90% of the cost of quarantine and inspection services ($45m); abolition of the First Home Owners Scheme ($153m), the Australian Institute of Sport ($22m) and the Australia Council ($50m); and 39 other spending cuts.
In some quarters this was not well received. A representative of the Australia Council telephoned John Hyde about Cole's recommendation to abolish that organisation. His angry interlocutor seemed unabashed by the evidence that of its budget of $58 million, (96) $8.7 million was being spent upon administration, making the Council's 117 staff the largest identifiable beneficiaries of the Council's existence. Such blatant selfishness and ministerial gutlessness in dealing with it was too common, but was not a fair sample of human nature. The influence that AIPP and the other advocates of less intrusive Government sought depended on the millions of people who did not come begging and whining at Governments' doors.
As the CIS was to do with greater success, with Dr Alan Tapper's The Family and the Welfare State, the AIPP turned its attention to cultural/social issues, taking up the cause of the family. They felt that the talking class had advanced an anti-family culture that accorded till-death-us-do-part marriages no honourable status, even characterising them as oppressive. Governments that had once illiberally favoured heterosexual married families now illiberally subsidised anti-family propaganda and provided tax/welfare benefits to single parents that were more generous than those available to those who married and stayed married. The study attracted sharp feminist criticism.
The IPA, CIS and AIPP all had relatively broad agendas and relatively sophisticated approaches of which I have tried to convey the flavour. During the 1980s several organisations with methods often far removed from the Atlas style also contributed to an increasingly dry debate in Australia. Some endure.
OTHER AUSTRALIAN DRY ORGANISATIONS
Elaine Palmer and Nadia Weiner set up Centre 2000, based in Sydney, which for some years catered well for the interests of young people. It also provided a much-needed service by retailing the more important liberal books. Eventually Centre 2000 came unstuck after aligning itself with partisan political forces -- the Joh for Canberra campaign. Jenny Lindsay re-established and expanded the book retailing enterprise.
Professor Mark Cooray of Macquarie University established Australians for Commonsense, Freedom and Responsibility to produce educational publications to preserve democratic capitalism, freedom, free enterprise, the rule of law and "all that is best in Western civilisation". It produced some useful publications but eventually ran out of resources.
The Centre of Policy Studies (CoPS) was established at Monash University under Professor Michael Porter with a Research Centre of Excellence Award of $460,000 annually. It published more detailed work than any of the private think tanks and it had the resources to gather data and run economic models. Initially it concentrated on budgetary reform. Its publication, Spending and Taxing, was a comprehensive review of fiscal management identifying significant savings. Although its command of resources was at the time the envy of people in the private sector, Porter had more influence after he left CoPS to form The Tasman Institute. This Melbourne-based institute shared Project Victoria with the IPA. Through the work of Dr Alan Moran, who later joined the IPA, it developed a considerable expertise in regulatory reform, environmental management and the privatisation of utilities.
Staff at the National Institute of Labour Studies (NILS) at Flinders University tended vehemently to deny any connection with the "dry", "economic rationalist" or "new right" (a term in use during the late 1980s) circle. (97) It was however highly regarded within the circle and the advice of its publications and staff was sought.
The Australian Congress of Cultural Freedom (ACCF) and its magazine Quadrant were conservative in a Burkean sense, seeking to preserve those habits that had with experience proved beneficial. It had been formed to combat the popularity of communism in the post-war years; a struggle it had conducted courageously and effectively. Dries were to quarrel with Quadrant on economic issues, especially trade, during the period of Robert Manne's editorship but at other times and since Padraic McGuinness assumed the editorship Dries found themselves in broad agreement with Quadrant and the ACCF.
The H.R. Nicholls Society (HRN) (named after a former editor of The Hobart Mercury who was charged with contempt of court but acquitted for describing the Arbitration Commission in terms that most Dries regard as apt) concentrated on publicising shock-and-horror stories from the labour markets. These are plentiful and HRN was able to make singularly effective use of very modest resources.
Run by Ray Evans, it was launched in Melbourne with as much fanfare as its organisers could muster but at the time it gained but modest media attention despite the attendance of Sir John Kerr, the Governor General who had sacked Prime Minister Whitlam and the presiding judge who had gaoled the union official Clarry O'Shea for refusing to pay fines. Charles Copeman, the chairman of Peko Wallsend about to enter a prolonged, bitter and successful dispute with its unions at Robe River, also attended, but there was no mention of the coming action. He listened and gained confidence from the papers presented and the views of fellow travellers.
Six months later when the Labor Party was suffering a bout of internal division, Mick Young, presumably to foster party morale, launched an attack on the "clandestine" HRN. He accused it of masterminding the dispute at Robe River and describing its adherents as "the new right" of whom all right-minded Labor people should beware. Bob Hawke described the organisation as one comprised of economic lunatics and troglodytes. They effectively launched HRN; for years it could exploit the notoriety it then received until gradually it was accepted even by Labor Party people as an organisation whose invitations to attend and address seminars they ought to accept.
Young's attack had been reasonably good-natured. Not so the disapproval of Brian Powell, the then chief executive of the Victorian Chamber of Manufactures, who accused the "New Right" of being "classic fascists". (98) Dries turned this too to advantage. They milked the opportunity to explain how much the Australian industrial relations system resembled the corporatist power-sharing of Government, business and unions that had been practised by Mussolini.
The Samuel Griffith Society was formed in 1992, principally by John and Nancy Stone, "not only to contain the further expansion of power in Canberra but also to restore a balance between States and Commonwealth much more akin to that which the Australian people established in the 1890s". (99) It holds periodic conferences on constitutional topics, among which native title has featured prominently, publishing the proceedings in book form.
The Galatians Group was formed by three clerics of the Uniting Church. St Paul had written a rather testy note to the churches of Galatia pointing out that their members would be judged individually for their faith and virtue. Galatians 3:28 reads, "There is neither Jew nor Greek, there is neither bond nor free, there is neither male nor female: for ye are all one in Jesus Christ". Later joined by clerics of other denominations, they addressed social issues in terms to influence the faithful.
New Zealand's biggest companies who provide its Board finance the New Zealand Business Roundtable (NZBR). Under the directorship of Roger Kerr, it has been among the most effective policy advocates in the world. It, like them all, stands or falls on the rigour of consistent argument and so far as an outsider can tell there has never been a successful attempt by the business interests to divert Kerr from New Zealand's national interest. The Roundtable's published arguments have been of such exceptional quality, consistency and caution that they have appreciably influenced debate in Australia. Organisations with structures similar to that of the NZBR that have preserved reputations for independence of the interests that control them are rare. Despite NZBR's success, which I believe has depended on Kerr and the Chairmen of its Board, not many Dries would recommend its structure.
Although the fact was generally not recognised in Western academic circles, from about 1975, socialism was collapsing under the weight of its own failures. Therefore, had the network stretching outward from the Mont Pelerin Society not existed, change from it in the socialist nations was eventually virtually inevitable. What, however, in the absence of the network's ideas would have replaced it?
In countries such as Australia, that had avoided full-blown socialism but which, nevertheless, had had an exaggerated view of what Governments could achieve, policy failure was evident. There was, however, no sense of crisis to drive change. Certainly, by 1975 collectivism had little political-philosophical support left but liberalism had not replaced it. Public policy had become a hunting ground where interests competed with each other for political favour, but hardly at all with any ideal. What did the Australian Liberal Party believe in? It claimed that it was anti-socialist, but who any more believed in socialism? What, after it ceased to believe in socialism, did Labor believe in? The IPA, CIS and AIPP stepped into an ideological vacuum where their opponents were most often not idealists but vested interests.
In the 1970s the framework of institutions that sustain a liberal, democratic, capitalist society featured but little in public debate and Governments that served narrow interests were not -- at least until the WA Inc episode -- thought of as corrupt. Journalists who aspire to professionalism, of whom there are enough to get messages to the public, would present alternative arguments but they had to be given them. They needed sources to quote and the dry think tanks provided these.
It is, as Lincoln observed, in the nature of democratic politics that without public sentiment nothing can succeed. During the 1980s the free market-market think tanks had high standing and influence. By 2000, however, the IPA and CIS had by no means lost the intellectual ground that they and others had won but people, most significantly those in authority, again did not want to hear.
ENDNOTES
87. G Myrdal, Value in Social Theory, London 1958, pp 21-24
88. R.M. Hartwell, A History of the Mont Pelerin Society, Liberty Fund, Indianapolis, 1995.
89. Businesses use TV advertisements to change attitudes to the products or the businesses themselves; industry and union advocates do the same; so do Governments and political parties. The most notorious (mis)use of impact advertising (but of course not TV) was, perhaps, Hitler's.
90. For instance the British National Policy for Industry.
91. For instance those of Professor Copeland and the Labor Party
92. D.A. Kemp, The Institute of Public Affairs, 1942-1947, p. 22
93. Rosemary Kiss in The Kennett Revolution, Editors: Costar and Economou, UNSW Press, 1999, p 115
94. Denis Hussey, AIPP, Policy Paper No 6
95. Tax-expenditures are exemptions from the general tax provisions available to favoured taxpayers.
96. More than the $50 million that Cole felt could be saved because some ongoing expenditures were inevitable.
97. The National Times, 13-19 September 1985
98. The West Australian, 3rd, 15th, and 21st September 1986
99. Proceedings of the Second Conference of the Samuel Griffith Society, 1993, p v.
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