A Blow to Deregulation

Deregulation and opening up competition in infrastructure like electricity and telecommunications have been central to Australia's strong economic performance.

To the applause of those recognising regulation's stifling effect on business, last April the Treasurer, John Brumby, announced a new Government agency, the Victorian Competition & Efficiency Commission (VCEC).  A key part of the VCEC's task was to scrutinise proposed new regulations, which were in future to require a business impact test.

The Bracks Government, intent on establishing the economic credentials that would keep them in office for decades, was also turning its mind to other promising cost-saving agendas.  A key one of these was in energy.  Minister Theophanous played the leading role in the formation of the Australia-wide Ministerial Committee designed to promote consistency and uniformity in the nation's $60 billion electricity and gas supply industry.

This need for greater uniformity in national competition arrangements is widely recognised.  It was a major feature of a recent broad-ranging Productivity Commission report into how to renew the reform process and maintain a strong economy.

Unfortunately the lofty principles behind the Victorian Government's initiatives in this direction are proving to be but chaff in the wind.  They are being discarded once ministers glimpse an opportunity for exploiting a vote-getting issue.

With the ink barely dry on its overarching policy programs, the Treasurer confronted a situation with regard to wind energy where they would frustrate his preferred outcomes.

Wind generators already receive hidden subsidies from electricity consumers as a result of a (Commonwealth) regulation.  These subsidies provide wind generators with a price for their output that is two to three times that received by conventional generators.

In spite of this, proponents of wind generators are finding it difficult to finance them.  So, Mr Brumby has introduced a Wind Energy Development Bill that will require customers, not wind developers, to pay for the costs of new electricity lines that connect them to the users.  As with the Commonwealth subsidy, consumers will be unaware of the transfer.  Needless to say, there was no scrutiny of the proposal by VCEC.

The new proposal piles on yet another subsidy to a hopelessly uncompetitive power source.  It also thwarts the national uniformity Victoria has so vociferously championed.  The electricity code requires generators to pay for new connections to customers.  Without such a rule, we would see remote and inaccessible generators whistling up new electricity lines that are paid for by users in general.  Providing "free" funding for these generators would bring a vast increase in the cost of the electricity delivered to the customer.

Making matters worse, the Victorian Government's wind proposals leaves the receipt of the subsidy for each proposal to the Minister's discretion.  This opens the door to the sort of banana republic political corruption that can cause the economy to nosedive.

A stable regulatory framework and an agreement by politicians to setting broad policy and legal frameworks are essential for an efficient productive process.  This requires politicians impose iron disciplines on themselves.  It would be most unfortunate if we in Victoria were witnessing the State's Treasurer spearheading a corrosion of these disciplines.

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"Hands off" Gets Fiery Results

What is best for the environment?  What should our environmental priorities be?  How interventionist an approach should we take, for example, to the management of weeds in national parks?

Before the federal election, it was thought that the Australian Greens led by Bob Brown would hold the balance of power in the Senate.

Public policies would reflect their view on what was best for the environment, including that an additional three thousand gigalitres (six Sydney Harbour equivalents) of environmental water be flushed down the Murray River.

The election, however, threw up something altogether different.  The Australian Greens are unlikely to have much influence in the new Parliament.

This perhaps represents an opportunity for us to reflect on alternatives and consider what is really best for the environment, while balancing economic and social considerations.

Early conservationists subscribed to a "Garden of Eden" type model with man having a management role tending and looking after the landscape.  Remember Noah built the ark to save the animals from the flood.

More recently a "hands off, leave it to nature" philosophy has developed and become embedded in many government policies.

This approach, which underpins much of the recent native vegetation management legislation across Australia, seems to almost deny the dynamic nature of our landscapes and excludes man from an active management role.

Last year, the Queensland Government went to great trouble to suppress the findings of a report prepared by its own officers that explained how uncontrolled woodland thickening associated with bans on tree clearing would likely result in a reduction in ground flora biodiversity and increased erosion.

At the same time, and while the NSW Government was focused on banning tree-clearing to protect perhaps 20,000 hectares of native vegetation, close to three million hectares of forest and native vegetation was incinerated in bushfires.

The extent and intensity of the bushfires was at least in part a consequence of the "hands off, leave it to nature" philosophy that had prevented adequate controlled burning.

It is a fact of life that if you don't have your own plan, your own vision, you will likely be recruited into implementing someone else's plan.

Organisations such as the World Wide Fund for Nature (WWF) and the Australian Conservation Foundation don't undertake much tree planting or grow any organic food themselves -- they are about recruiting others to implement their plans, their vision of what is best for the environment.

The Australian landscape and our own beliefs and values, are not things that have always existed in their current form.  They have been, and are being, evolved.

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Telstra's regulatory waltz

Allan Fels would like to increase the already innumerable regulations to which Telstra is held ("Fully privatised Telstra more of a bully", Opinion, October 13).

Telstra is already responsible to its customers, its shareholders, the government, the Australian Competition and Consumer Commission and the Australian Communications Authority, not to mention self-regulation groups like the Australian Communications Industry Forum.

Every significant change in price structure is greeted with a barrage of competition notices and inquiries.  If Telstra tries to offer discounted prepaid phone packages, they are condemned.  If they try to harmonise their fixed line rentals with the new broadband market where many households are disconnecting their second line they are condemned.

Telstra is even condemned by the telecommunications industry ombudsman when their broadband customers voluntarily spend more money than expected.

The price war over broadband earlier this year is a case in point.  Every attempt to offer Australian consumers cheaper and faster internet access is in spite of, not because of, the ACCC.  No wonder the quality of our internet connections is so low compared to the rest of the world, when it must first sit through this regulatory waltz.

The last thing the industry needs is even more regulation.  Already restricted by its universal service obligations and price controls, Telstra has less control over its own direction than does the ACCC.  And in a time when broadband is becoming increasingly ubiquitous, the overly aggressive restrictions that Fels proposes will pre-empt a dynamic and competitive industry.

Greens caught short at polls

Last week's federal election could well be the Greens' Waterloo.

The Australian Greens -- both the party and the collection of organisations that act hand-in-hand with it -- went into the election with great expectations.

The rival party of the left, the Democrats, was imploding.  Their various campaigns had received near saturation media coverage.  The media, with a few exceptions, was fawning.

The environmental organisations were cashed up.  And the public was becoming environmentally aware and concerned.

The expectation that the Greens were set to become the third force of Australian politics was shared by most commentators and some business associations.

Indeed, the National Farmers' Federation, in preparation for this inevitability, publicly praised Greens policies and the reasonableness of its leader Senator Bob Brown.

In the end, the Greens failed.  While their vote across the country rose to 7.1 per cent, this was much less than the double-digit figure expected.

They lost their only House seat, and may just win a second Senate seat in Tasmania.

In contrast, the Coalition, which was the "least green" of the major parties, picked up four additional Senate seats.

Importantly, Green preferences did not help Labor win in any mainland seat.

The Democrats' share of the vote dropped 5 percentage points to less than 2 per cent of the total national vote.

And it appears that more Democrats votes went to the Coalition than to the Greens.

What happened?

First, the Greens were exposed for what they are -- a radical left-wing party.  To become the third force, they had to release policies on issues other than the environment.  They did so and were exposed as extremists in economic and social areas.

Second, the main parties have captured much of the green agenda and in so doing have captured the real appeal of the Greens.

Third, the Greens' stand on Tasmanian forests was rightly seen as uncompromising and hard-hearted -- intent on locking up the forest irrespective of its impact on local communities and jobs.

The Greens' failure in 2004 will reverberate throughout the community.  It will strengthen the resolve of many rural communities to resist green fundamentalism.

This is already having an effect, with John Anderson, the leader of the National Party, declaring his intention to review native vegetation laws.

The media is likely to be more objective towards, and perhaps even critical of, green policies.  This in turn may cause the rich and comfortable suburbanites, who make up the bulk of the Greens' support base, to think before voting Greens or accepting green stories of doom and gloom.

Hopefully, it will also induce governments to listen more to people from the communities that are affected by environmental regulations and make decisions based more on science than spin.

Smart businesses will perhaps realise that green fundamentalism is not the political force of the future and that the community understands that economic growth is consistent with good environmental outcomes.

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Congratulations, Tassie

Three cheers to Tasmania's forestry industry.

The Prime Minister, John Howard, was ambivalent until the very end.  Yet the foresters have won and survived to fight another day.

After arriving home about midnight on Saturday, I saw a colleague had called the election very early in the evening on the basis of the foresters' vote.  The e-mail waiting for me read, "Bass and Braddon (Tasmanian seats in forestry areas) have gone to the Libs, election is all over, called at 6.09pm".

Surviving Tasmanian Labor parliamentarian, Dick Adams, said on Sunday television that elitist policies written out of Sydney and Canberra are to blame.

His assessment was that Labor's primary vote suffered because we "got into bed with the Greens".

Over the years Tasmania's foresters have proven a tenacious lot.

Grass-roots organisation Timber Communities Australia (TCA), has fought many government-sponsored inquiries and even taken on the British Broadcasting Commission (BBC).

In 2002, TCA lodged a complaint with the Broadcasting Standards Commission in London alleging that the BBC had misled viewers in its documentary called "Paper Tiger".

Tasmania has 40 per cent of its total land and its forests protected in reserves, with 67 per cent of its rainforest and 97 per cent of its high quality wilderness fully protected.  Yet the BBC documentary had suggested the industry was wiping out last remaining stands of trees.

The BBC was eventually forced to publicly and internationally acknowledge that it had broadcast an exaggerated and inaccurate television documentary.

This election, Tasmanian foresters appear to have had another win.  In the process they have perhaps saved us all from the Australian Greens and their vicious and narcissistic approach to conservation and environmentalism.

The environmental fundamentalists went into the election campaign focused on three issues:  "Saving" Tasmania's forests, "saving" the Murray River, and "saving" the world from climate change.

It was the forestry issue that attracted most attention, including a preference deal between the Australian Greens and the Australian Labor Party.

Labor lost the election, including at least two seats in Tasmania.  The Greens' preferences came at a significant cost to Labor's primary vote.

In contrast to Labor's loss, the Greens have emerged to replace the Democrats as the official third force in Australian politics.

However, the Greens are unlikely to have any real influence in the new Senate and they have lost their one seat in the House of Representatives.

I hope this outcome resonates as an issue -- that selling out a primary industry in the hope of snagging city sentimentalists with propaganda can backfire.

Both major political parties must start to realise that a more rational and meaningful approach to the environment is desperately needed.

And so Tasmanian foresters, I salute you.

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Relations with Nongovernmental Organisations: Lessons for the UN

Seton Hall Journal of Diplomacy and International Relations

INTRODUCTION

Only very recently have relations between governmental institutions and nongovernmental organisations (NGOs) become a significant policy matter.  The significance is driven by the recent phenomenal growth of national, transnational, and international NGOs, ⁽¹⁾ many of which seek to influence public policy.  This phenomenon has caused governments and intergovernmental institutions such as the UN, EU, IMF, and others to respond by opening the doors to NGOs.  How far an entry NGOs make may be a reflection of the institutions' democratic mandate, their policy role, and their preference for either "liberal internationalism," an international legal order and governing institutions, or "democratic sovereignty," in which democratic sovereigns are at the centre of the international system. ⁽²⁾

The increased propensity and ability to organise civil voices through NGOs is a major element of advocacy or participatory democracy.  By contrast, governments and intergovernmental institutions are the product of representative democracy.  The essential issue is to seek the proper relationship between representative democracy and participatory democracy.  The management of the relationship is an important point from which to observe these two modes of democracy.  A common characterisation of the two is "vote" and "voice".  The characterisation is misleading for two reasons.  First, the language of "voice" is used to reassure elected representatives that organised opinion is no threat.  Indeed, it is not, unless, of course, representatives transfer their authority to the advocates. ⁽³⁾  Second, the characterisation undersells the concept that representative democracy is a process of recognising voices and making sense of them by settling the myriad claims upon public power.

Elections are but one part of the architecture of representative democracy.  Other aspects are the courts, which assist private dispute resolution and the review of government decisions;  the taxation regime, which funds programs;  and, the intense focus of the daily media.  These are the well-tested elements of the "daily plebiscite" ⁽⁴⁾ of politics in the liberal democratic state.  They operate with intensity and a grounded nature that only occurs at the scale of the nation-state and below.  This does not mean that the system does not suffer in the eyes of the voters from unfulfilled expectations of ever greater access and preferred outcomes, but participatory democracy reaches its peak within the representative framework of the liberal democratic state.

PROBLEMS OF N.G.O. LEGITIMACY IN INTERNATIONAL FORUMS

By contrast, participatory democracy at the international scale flounders.  The desire by intergovernmental institutions to incorporate participatory democracy into their processes, in the absence of the architecture of representative democracy, may simply be a reflection of the desire to seek a new role for their organisations.  That new role may be built on a new constituency among those who are enthusiastic for the agendas they share.  It has been observed that there is a "symbiosis between international NGOs and international organisations, [a] mutual legitimation in which international organisations treat international NGOs with all the legitimacy and deference that domestic democratic governments must treat their domestic voters". ⁽⁵⁾  Unlike the domestic voter, however, NGO claims to public policy access need to be substantially qualified.  Their claims rest on being the voice of civil society, whether or not it represents their members' interests, universal interests, public interest, or in their expertise in a specific policy arena.  Like political leaders though, NGO leaders are an elite.  Their values are likely to be in the vanguard of their supporters, and they are certainly not likely to reflect broad opinion.

The release of the UN Report of the Panel of Eminent Persons on United Nations-Civil Society Relations on June 11, 2004 ⁽⁶⁾ stimulated an intense debate about the proper relationship between the two modes of democracy and the management by intergovernmental institutions of the NGO relationship.  The claims of the panel in these regards are bold.

The rise of civil society is indeed one of the landmark events of our times.  Global governance is no longer the sole domain of Governments.  The growing participation and influence of non-State actors is enhancing democracy and reshaping multilateralism.  Civil society organisations are also the prime movers of some of the most innovative initiatives to deal with emerging global threats. ⁽⁷⁾

The claim is supported by a number of propositions.  The major ones are paraphrased below, in italic, with a preliminary response immediately following.

Traditional democracy aggregates citizens by communities of neighbourhood (their electoral districts), but in participatory democracy citizens' aggregate in communities of interest. ⁽⁸⁾

There is a fundamental flaw in the argument about different aggregations of public opinion.  Only when interest-based opinion is filtered through electoral district opinion, not to mention a myriad number of other filters, are the outcomes not driven by a consensus of activists.  The consensus is constrained by those who do not share the activists' worldview.  Global civil society is the largest and least defined electorate imaginable.  NGOs constitute a very particular slice of that civil society, the politically active elite.  They are elite in the sense that elected officials are elite.  Politicians' attitudes vary considerably from those of their constituency;  it is a part of their motivation "to do good" and "to make a difference".  They are not merely vessels of public opinion.  They are nevertheless constrained by having to be formally accountable for their actions, and they are constrained to not move too far from the values and preferences of their bosses, the electorate.  NGO leaders suffer no such constraint, sometimes not even within the bounds of their organisation and certainly, not from the wider constituency.

The UN needs to reflect on its mandate.  Although it is keen to quote from its masthead "We the Peoples," it is, of course, a creature of nation-states.  If it attempts to become a world forum for all comers, without the architecture to test world opinion or the responsibility of raising taxes and armies, then it must not pretend to have the authority of world opinion.  If it attempts to be the moral conscience of the world, it must be prepared to acknowledge that it has neither the spiritual substance of the church nor the certainty of a single politico-economic system (to claim the liberal democratic West as the model would destroy its credibility with much of its constituency).  The UN may seek greater relevance, but it risks becoming nothing more than a platform for untested opinion.

Nowadays, non-State actors are often prime movers -- as with issues of gender, climate change, debt, landmines and AIDS.  The first step is often the creation of global policy networks to promote global debate.  The United Nations has to date often played a weak role in such innovations. ⁽⁹⁾

The statement is a plea by the UN to keep itself in the game.  It may be true that non-state actors were instrumental in the named campaigns, but it is naive to suggest that the campaigns were successful, the policy prescriptions correct, or that the major incubators of change were not liberal democratic governments, acting in response to their constituents, many of whom were NGOs.  The UN is seeking to add value to the policy process, but providing forums for NGOs may not assist the policy process.  "What the panel essentially means is that the General Assembly is lagging behind the leadership of the Secretariat and of NGOs, and must now catch up.  Presenting the UN as backwards is a way of exerting pressure on governments to accept the Secretariat's agenda for reform". ⁽¹⁰⁾

There is increasing public dissatisfaction with the institutions of global governance.  Transnational civil society networks are moving to fill this challenge and enjoy increasing public support. ⁽¹¹⁾

The difficulties with these claims are that public dissatisfaction cannot be readily gauged without an election, and no such mechanism exists for the UN.  Dissatisfaction will almost certainly rise as the ability to voice opinion rises.  Access to policy forums is a positional good and only so many places are available;  the more voices that appear, the louder will be the cry by those who miss out.  Further, the panel uses the term governance as a ready substitute for government, thereby hoping to bypass the essentials of representative democracy.  It also underlines the fact that the UN is in no sense a government, but a committee of governments.  The statement also implies the familiar criticism of democracy within the nation-state.  For example, "all modern states face a crisis of legitimacy … that prevents publics from shaping state policy.  Instead, they are manipulated by it." ⁽¹²⁾  The argument serves the interests of NGOs, but it not apparent that NGO access will solve the so-called crisis of democracy.

There is increasing public disenchantment with traditional democracy, in an age of global interconnectedness and concerns about sustainability.  UN conferences begin to fill the gap by taking on characteristics of a global parliament. ⁽¹³⁾

A global parliament consisting of whoever is fortunate to receive an invitation to a UN conference does not constitute a responsible body of opinion.  Nor does it have any of the means of enacting its desires, such as raising funds and passing laws.  In this sense, it is doubly irresponsible.  A test of the validity of NGO representation of the public interest is to ask if the sum of all NGO opinion represents public opinion.  The answer is almost certainly no.  The UN has provided forums where up to 300,000 NGO activists, representing 2600 NGOs, have attended. ⁽¹⁴⁾  This is not a policy-making forum.  This is a bazaar.  The UN appears to acknowledge this criticism with its recent statement, "the age of the big United Nations conferences is largely over", ⁽¹⁵⁾ but this appears not to have dissuaded the UN secretariat from expanding its agenda of NGO engagement.

There is no logical reason why an international forum per se has solutions that a national or nation-sponsored forum has not.  "There is nothing conceptually or practically obvious about believing that the international ought to have the conclusive word on the universal". ⁽¹⁶⁾  Any numbers of national constitutions, as well as the common law and other legal systems, have for generations defined and refined the meaning of human rights.  These nations have passed anti-discrimination laws and conservation laws and run highly sophisticated health systems to deal with the threat of AIDS.  They also produce great wealth, sufficient to aid those nations who do not produce enough for their needs.  They also produce the science that drives wealth production.  In short, all of the claims that the UN and the internationalists make for the healing powers of internationalism are already in practice in the successful nations.  Moreover, almost none of the named problems are international, they are simply found in many nations and regions.

The major conferences have begun to level the North-South playing field.  The power and confidence of Southern voices have risen dramatically.  The Southern voices gain protection from the UN in criticising their governments. ⁽¹⁷⁾

Advocacy implies inclusion, but in fact, it leads to a differential ability "to access nonelectoral arenas" such as lobbying, court processes, news coverage, and so on.  "There is no clear equivalent to 'one person, one vote' for advocacy democracy". ⁽¹⁸⁾  In deciding which group is to have access to a forum, for example, some will be excluded.  Questions must be raised about the credentials of those granted access as a means of verifying and justifying access.  In terms of political equality, advocacy leads to problems of very unequal use.  While a high proportion of citizens' vote, very few are politically active.  This low activity has always been a feature of the representative system, in as much as few people joined a political party, but the inequality was to some extent remedied by the fact that the parties presented their candidates and policies for public election.  Activists who can bypass the public scrutiny have a lesser burden of proof than the elected official.  In terms of enlightened understanding, advocacy can stimulate debate but it can overload citizens, in effect leaving them to have the matter determined by others, much as occurs in the representative model.  The difference is that a new set of activists are now included.

A further issue is whether UN sponsorship of Southern NGOs makes them advocates for their people or ambassadors for the UN agenda.  The argument about a lack of voice is only valid in undemocratic nations.  Should the UN therefore only recognise NGOs from undemocratic nations?  Of course, it could not allow this since it would reveal a fundamental schism between democratic and undemocratic states within the UN.  It would encourage a caucus of democracies and reveal that these are also the Northern nations.  In this context, what value do Northern NGOs add to debate, given that they are already articulate within their nations, and they already have access to the media and to private philanthropy?  The UN lifeline to civil society is really a second vote to (predominantly leftist) Northern NGOs.

If NGOs in international settings are unable to provide the legitimacy of a verifiable constituency, then their claims to utility must rest elsewhere.  One claim may rest in an ability to provide the "best" priorities.  Two pieces of evidence can be used to test that proposition.  A survey of the priorities of NGO leaders and a list of priorities generated by a group of eminent economists at the Copenhagen Consensus ⁽¹⁹⁾ suggests that the two vary substantially.  This is not to argue that all that is required of government is a scientific approach to goal setting, but that claims by NGOs on these grounds are highly contestable and probably very weak.

The recommendation from the Copenhagen Consensus 2004 expert panel of world leading economists, for example, was that combating HIV/AIDS should be at the top of the world's priority list.  This was followed by policies to attack hunger and malnutrition by reducing iron-deficiency anemia through food supplements, increase spending on research into new agricultural technologies, and reform global trade.  The latter included reduction of tariffs and non-tariff barriers, together with the elimination of agricultural subsidies, the extension of regional trade agreements, and the non-reciprocal lowering of rich-country tariffs on exports from the least developed countries.  The panel looked at three proposals, including the Kyoto Protocol, for dealing with climate change by reducing emissions of carbon, but regarded all three as bad projects with costs that were likely to exceed the benefits.

Contrast a recent survey ⁽²⁰⁾ of NGO leaders' visions of globalisation in the year 2020.  A very strong majority of NGO leaders indicated that they wanted a greater focus on the protection of human rights (95 percent), the environment (95 percent), as well as greater telecommunications and Internet access across the "digital divide" (91 percent) and social standards and social security (89 percent).  NGO leaders considered completing the Doha Trade Round (19 percent) least important.

Interestingly, Southern NGO leaders were significantly more likely than Northern leaders to want a greater focus on economic factors, such as international trade (61 percent vs. 27 percent, respectively), and direct foreign investment by companies (49 percent vs. 16 percent).  Southern NGO leaders were more inclined than Northern to consider "very important" those initiatives that build developing countries' capacity, including improving the transfer of technology to developing countries (84 percent vs. 66 percent) and the reduction of farm (70 percent vs. 47 percent) and textile (64 percent vs. 46 percent) subsidies and import restrictions in industrialised countries.

On the issue of changes to the political architecture, a strong majority of NGO leaders did not support American-led multilateralism (79 percent) and the presence of strong national governments with few international controls and weak international institutions (68 percent).  Instead, leaders were more likely to select a reformed and strengthened UN and multilateral institutions controlled by sovereign states (67 percent) or an evolving world government that was accountable directly to citizens rather than to nation states (66 percent).  In the management of global affairs, NGO leaders believed that NGOs (84 percent), developing countries (82 percent), and individual citizens (80 percent), as well as the UN (82 percent) and its agencies (79 percent) should all have stronger roles in the management of global affairs by the year 2020.  Conversely, these leaders called for weaker roles for the United States (66 percent), military alliances (64 percent), global companies (57 percent), multilateral agencies (48 percent), and industrialised countries (40 percent).

NGOs are clearly in the "liberal internationalist" camp.  They clamour for access to the UN, and the UN secretariat is keen to accommodate them.  Moreover, Northern NGOs are a special subset of the international electorate.  They seek to turn their minority opinion into majority opinion, through intergovernmental institutions.  The effect is to distort priorities and to replace constituencies with lobbies.  The governance of international affairs, in as much as intergovernmental institutions operate, is built on the membership of nations.  There is no direct voice by a transnational electorate.  Until there is, no amount of encouragement by international bureaucrats, seeking their own constituency among "international civil society" NGOs, and more latterly, business, can substitute for that lack of direct voice.  There is no architecture available that can turn an international governing institution into a responsible transnational government.

SOME PRACTICAL REMEDIES

Putting aside for the moment these fundamental difficulties with NGO access to intergovernmental forums, how are those who clamour for a voice at international level to be accommodated?  The UN arguably has been the least disciplined of the intergovernmental institutions in its management of NGOs.  The global conferences of the 1990s and the Millennium events, which included UN secretariat-sponsored NGO agenda setting forums, ⁽²¹⁾ suggests that the UN permanent officers have in mind a political strategy to enhance the UN as an instrument of "non-state actor" policy makers.  Similarly, the EU Commission has been ill-disciplined in its management of NGO relations, although there appears to be some rebalancing with the recent implementation of a disclosure regime for NGOs, possibly at the behest of Members of the European Parliament.  By contrast, the IMF has begun to open its door to NGO involvement, but with a clear understanding that the role of NGOs is to aid specific IMF policy objectives.  The same could be said of the WTO.  By contrast, in Australia, as an example of a nation-state where clearly there is a "daily plebiscite" in place and where NGO involvement in policy formation has been generally welcomed, there is discussion within the government to enhance an NGO disclosure regime. ⁽²²⁾  The EU, IMF, and Australia have some practical lessons that may be useful for the UN.

The EU is neither a federation like Australia or the United States nor is it an organisation for cooperation between governments like the UN.  The member states pool their sovereignty on a range of issues and are governed by a Council, appointed by member states, and a directly elected Parliament as co-legislators.  As the European Parliament stated in its Resolution on the white paper on Governance, "consultation of interested parties … can only ever supplement and never replace the procedures and decisions of legislative bodies which possess democratic legitimacy". ⁽²³⁾  The EU commitment to participatory democracy may soon gain constitutional status with an Article of the Constitution under consideration dealing with participatory democracy that suggests, "The European Union recognises participatory democracy as complementary to representative democracy.  The institutions of the Union guarantee a high level of transparency and put in place procedures of information, hearings, and consultation in order to allow the appropriate participation of associations of organised civil society." ⁽²⁴⁾

The guiding principle for the Commission is the familiar refrain to give interested parties a voice, but not a vote.  The Commission has underlined its intention to "reduce the risk of the policy-makers just listening to one side of the argument or of particular groups getting privileged access". ⁽²⁵⁾  It seems not to have recognised that even "balanced access" can generate costs.  Allowing a great deal of access to organised voices can create agendas so strong as to constitute a vote.  For example, the EU established a Social Platform in 1995 to bring together over thirty European NGOs, federations, and networks.  The members of the Social Platform represent thousands of organisations, associations, and voluntary groups at local, regional, national, and European level.  Ninety-five percent of the Social Platform is funded by a grant from the European Commission to support its running costs. ⁽²⁶⁾  A weakness with the EU "consensus" approach, in which it appears that everyone has a say, is that there is also a propensity for the Commission to fund much of the activity.  For example, there are six different consumer NGOs funded by the EU Commission.  There is the danger of co-option when the institution, in its desire to listen to new voices, simply funds those who are deemed not to be able to afford it, but who in the end may echo the preferences of the EU Commission.

The redeeming feature of the "funded consensual" approach is that in June 2002, the EC established the Consultation, European Commission and Civil Society (Coneccs) database.  The Coneccs Internet site offers public information on nonprofit organisations established at the European level and information on the committees and other consultative bodies the Commission uses when consulting organised civil society in a formal or structured manner.  The rationale is that "with better involvement comes greater responsibility.  Civil society must itself follow the principles of good governance, which include accountability and openness". ⁽²⁷⁾  The index of organisations is compiled on a voluntary basis and is only an information source.  It is not an instrument for securing consent or a system for accrediting organisations to the Commission. ⁽²⁸⁾  Neither is it a single point of enquiry for all relevant matters on EU Commission-NGO relations.  The direct grant of funds to NGOs is not specified in the database so that, for example, grants awarded by the Director General of Environment are contained at a separate site, as others are in different portfolios. ⁽²⁹⁾

In contrast to the UN and EU and other technical bodies, such as the World Bank ⁽³⁰⁾ and the WTO, ⁽³¹⁾ the IMF has no juridical basis for links with civil society built into its constitutional document. ⁽³²⁾  In general, the Fund has often preferred to keep its links with civil society associations at some distance. ⁽³³⁾  The IMF-NGO engagement has been largely seen as an "external communications strategy". ⁽³⁴⁾  Where the IMF has engaged NGOs, it has been for instrumental purposes, as a way to foster local "ownership" of IMF-supported policies.  For example, since 1999, low-income countries applying debt relief or new concession loans from the IMF (and the World Bank) are required to develop their own Poverty Reduction Strategy Papers through a consultative process that involves wide and substantive participation by civil society.

The IMF's engagement with NGOs recognises that some bring relevant expertise and experience for understanding economic issues and policies in Fund member countries, and that the Fund can therefore benefit from listening to their views in formulating policies.  More importantly, the Fund recognises that consultation can increase national ownership of Fund-supported policies.  The Fund has an instrumental approach to NGO engagement.  It has a clear policy mandate and engages NGOs to help the policy be successful.  Nevertheless, this is not to argue that NGOs need to be compliant.  The initiative to move from a "closed" to an instrumental approach may well have been a result of lobbying by US-based NGOs.  In 1994, the US Congress withheld three-quarters of a requested $100 million appropriation for the replenishment of the Fund, subject to greater information disclosure. ⁽³⁵⁾  The point is to allow sufficient space for deliberation by those responsible for decisions without a mandated role for NGOs at every forum.  This may be labeled weak NGO engagement.

The case for NGO access to the policy apparatus is strong within a nation precisely because the opportunity to filter it through electoral and parliamentary mechanisms is greatest.  Even so, the model of disclosure under discussion in Australia -- a Protocol -- is more formal and rigorous than that available at the EU.  While the role of NGOs in Australia as a voice of the public is developing apace, the ability of the representative system to manage and decipher these voices is under considerable pressure.  Political accountability must therefore incorporate not just access for groups, but a record of the access.  In effect, that record is used to demonstrate that while access cannot be equal, it can be managed in a rational and equitable way.  The proof of which is to keep the "unorganised" interests informed of the government's relations with the organised interests.

No mechanism exists in the government whereby citizens are informed as to how conclusions are reached about the bona fides and representativeness of NGOs granted standing.  Without such a mechanism, it is possible that, in terms of the potential to transfer authority from government to citizens in participatory processes, there is nothing more than the transfer of authority from government to NGOs.  A key element of the Protocol is the creation and maintenance of a single Australian government website.  The website, for the sake of illustration, called "Australian NGO Link" would be an interactive site that would enable any person to make an assessment of the myriad relations between government and NGOs.  It would enable the individual to assess in any year, or for a number of years, the standing of each NGO and sources of government funding of any NGO with significant relations with a government department or authority.  It would also enable the assessment of the government's use of NGOs across the whole range of departments and programs. ⁽³⁶⁾

• Participatory democracy has inherent inequalities.
• Voice without constitutional architecture is undemocratic.
• Even with constitutionality, there is the need for transparency.
• NGO engagement could be used instrumentally, but "good" policy is not necessarily produced by "participation".
• Encouraging NGOs can lead to co-option.
• NGO engagement must not be used to transfer authority from a government or an intergovernmental institution to members of civil society.
• Strong NGO engagement is possible in a nation-state;  weak engagement is preferred for intergovernmental institutions.

Constitutionality and transparency are the minimum requirements of democratic processes that incorporate representative and participatory democratic modes.  A possible antidote to institution building and agenda building is to ensure that when government officials grant access to the policy process, such access should be fully transparent.  The need for transparency increases as the constituency becomes more remote from the elected representatives.  Almost precisely the opposite seems to occur.  Where the resistance to the siren call of participation is weak in an intergovernmental institution, the mode of participation must also be weak.

UNITED NATIONS:  CULTIVATING A CONSTITUENCY

How do these principles apply to the proposals of the Panel on UN-Civil Society Relations?  First, the report does not arise in a vacuum.  The UN has been increasing its capacity for NGO engagement for a number of years, and the secretariat has been increasing its capacity to free itself from the funding constraints of its member nations.

The UN authority to engage with civil society rests on one highly circumscribed article in the UN Charter, referring to one committee, the Economic and Social Council (ECOSOC). ⁽³⁷⁾  From this, the relationship has expended enormously.  Applications for ECOSOC accreditation have grown substantially.  In the 1970s, there were twenty to thirty new applications per year.  This has risen to 500 currently, not including a backlog of 800 applications.  Currently about 1400 NGOs, mostly Northern, are accredited with Department for Public Information (about 600 of which overlap with ECOSOC list).  These commit to "sharing the UN's ideals and to disseminating information about its work to important constituencies via their newsletters, journals, magazines". ⁽³⁸⁾  This is a strange specification in the sense that any nation-state that made such a specification would be deemed authoritarian.  The criteria for accreditation should surely be value neutral and concern representation and expertise.

The UN Fund for International Partnerships (UNFIP), which was created in 1998, serves as the interlocutor between the UN Secretariat, some thirty UN agencies, and the UN Foundation.  The UN Foundation was created in 1998 after Ted Turner of Time Warner, committed one billion dollars ($100 million per year for ten years) in support of UN programs. ⁽³⁹⁾  It contributes to "the quiet drifting of the UN towards a multi stakeholder identity". ⁽⁴⁰⁾  Further, at the World Economic Forum at Davos in 1999, Kofi Annan launched a direct partnership with business, which he called the Global Compact, ⁽⁴¹⁾ asking business to internalise nine UN principles in the area of human rights, labour, and the environment.  Over 1,000 companies have now joined the Compact.

The next phase in NGO engagement will be most likely based on the report of High Level Panel on UN-Civil Society. ⁽⁴²⁾  It has made a host of recommendations for reform of UN civil society engagement.  The most important are paraphrased in italic, with following comments.

Proposal 1.  Member States need opportunities for collective decision-making, but they should signal their preparedness to engage other actors in deliberative processes.

There must be a clear distinction between deliberative processes and information gathering.  It is a normal process to have lobbying at many stages of any decision-making process, but to invite NGOs into substantive deliberative forums is a clear breach of constitutionality and exacerbates equality problems.

Proposal 4.  The United Nations should retain the global conference mechanism but use it sparingly to address major emerging policy issues that need concerted global action, enhanced public understanding, and resonance with global public opinion.

The proposal acknowledges the unwieldy nature of the global conferences but maintains the device may be essential to the UN's purposes if its constituent members are no longer responsive to some proposition that resonates with global public opinion.  But whose test of global public opinion will be believed, the sum of NGO opinion?

Proposal 6.  The General Assembly should permit the carefully planned participation of actors besides central Governments in its processes.  In particular, the Assembly should regularly invite contributions to its committees and special sessions.

The General Assembly is a deliberative forum and under no circumstances should it admit other than constituent members.  In a national parliament, members use the term a "stranger in the House" to call to the Speaker's attention any person within the chamber who is not an elected member.  The only exception is for a visiting head of state, and then, in rare circumstances.

Proposal 7.  In order to mainstream partnerships, the Secretary-General should, with the approval of Member States and donor support, establish a Partnership Development Unit.

This is an interesting proposal in as much as it seeks independent sources of support.  It may be used to free the hand of the secretariat.  Then again, it has the potential to enhance the opportunity for NGOs to play a lesser role of UN informant.

Proposal 12.  Security Council members should further strengthen their dialogue with civil society by installing an experimental series of Security Council seminars to include presentations by civil society.

There is no more sensitive forum than the Security Council.  The concept of seminars is extraordinarily naive, as the only matters that may involve civil society actors would have to be of such a sensitive nature as to be handled "in camera" or in a judicial manner by way of evidence.

Proposal 15.  Member States should make way for an enhanced role for parliamentarians in global governance.

This is interesting given that governments sign UN covenants, using foreign affairs powers in the domestic constitution, often without reference to their parliaments.  The proposal may work to make states less likely to sign up to any more covenants and other programs.  There are lessons as well for constituent nations.  It is a tradition of governments to include NGOs in official delegations to international forums.  Governments should consider very seriously the implications of allowing some voices to be amplified, as if they were the voice of the nation.  Disclosure of the delegation credentials is a partial remedy.  More properly, a total rethink of the use of NGOs by national delegations would be more appropriate.  The solution to having the voice of NGOs heard beyond the borders of the nation-states is to leave them to their own resources and forums.  The only "problem" that arises in this laissez-faire proposition is that the poor NGOs may not be able to attend.  Anyone who has tracked the amount of aid and philanthropic moneys available to NGOs to attend international forums knows that this is no longer insurmountable.

Proposal 19.  The United Nations should base accreditation on the applicants' expertise, competence, and skills.  To achieve this and to widen the access of civil society organisations beyond Economic and Social Council forums, Member States should agree to merge the current procedures into a single United Nations accreditation process. ⁽⁴³⁾

The first part of the proposition, to make expertise the key to accreditation is sensible, but it does not follow that "to achieve this" NGO access needs to be opened to more forums.

Proposal 24.  There should be an Under-Secretary-General in charge of a new Office of Constituency Engagement and Partnerships, absorbing a number of other units.

The rationalisation of engagement processes within the UN seems eminently sensible, if its brief is for a modest role for NGOs.  "Management has become concerned about the competing agendas of governments and civil society, about mounting member state questions concerning the legitimacy, representativity, and sources of funding of some of the NGOs". ⁽⁴⁴⁾  Better coordination, however, does not relieve the issue of the prerogative of sovereign nations;  it may, in fact, exacerbate the problem.

Proposal 25.  The Secretary-General should appoint 30 to 40 constituency engagement specialists to help the United Nations and the wider system enhance engagement with a diversity of constituencies. ⁽⁴⁵⁾

This proposal leads to the conclusion that the Secretariat is not envisaging a modest role for NGOs!

Proposal 27.  The United Nations should establish a fund to enhance the capacity of civil society in developing countries to engage in United Nations.

Does setting up a fund for Southern NGOs (as with the European Commission fund for the Social Platform and the consumer groups) risk having them echo the corporate UN agenda?  What about the capacity for independent action by civil society?  Consensus through participation is no guarantee to better policy.  It may be better to leave the NGOs to their own devices;  it seems that the amount of aid and philanthropic funds available to Southern NGOs is more than sufficient to have major voices attend functions.

CONCLUSION

The multilateralists tend to overstate the benefits and effectiveness of multilateralism.  Universal consensus standards are unlikely to be "better" than standards worked out over many years within a nation-state under the scrutiny of a parliament elections and the electorate familiar with the issues.  Further, multilateralists underestimate the nation-state democratic architecture, which consists of elections, parliaments, administrative and judicial review, free press, and so on.  There is a large element of UN secretariat aggrandisement in the engagement of civil society.  It is actively seeking a constituency.  To the extent that the UN wants to increase its engagement with civil society, a greater clarity of accreditation procedures is essential.  More important is a greater clarity of roles.  Input at hearings is acceptable, access to deliberative forums never is.  Transparency can help to overcome the equality problem in participatory democracy, but it cannot overcome the constitutionality problem.  The only remedy for that is to keep the NGO lobby at distance from deliberative forums, perhaps as far away as the real civil society, ordinary citizens.

---

ENDNOTES

1.  "[W]e are left with only one unambiguous fact about trends in associational life worldwide:  the numbers of formally registered nongovernmental organisations has risen substantially since 1989".  Michael Edwards, Civil Society (Oxford, UK:  Polity Press, 2004), p.23.

2.  Kenneth Anderson.  "We're Not from the Government, but We're Here to Help:  The International NGO Phenomenon" (Luncheon keynote address, conference on June 11, 2003 at American Enterprise Institute and Institute of Public Affairs, Washington D.C.).

3.  A point well made in Organisation for Economic Co-operation and Development.  Citizens As Partners:  Information, Consultation and Public Participation in Policy-Making (Paris:  OECD, 2001), p.93.

4.  Quoting Ernest Renan in Gregory Jusdanis, The Necessary Nation (Princeton, NJ:  Princeton University Press, 2001), p.24.

5.  Kenneth Anderson, "The Limits of Pragmatism in American Foreign Policy:  Unsolicited Advice to the Bush Administration on Relations with International Nongovernmental Organisations," Chicago Journal of International Law, Fall 2001, p.379.

6.  Report of the Panel of Eminent Persons on United Nations-Civil Society Relations.  We The Peoples:  Civil Society, The United Nations And Global Governance.  June 11, 2004, General Assembly 58th session.

7.  Fernando Henrique Cardoso.  "Transmittal letter dated 7 June 2004 from Fernando Henrique Cardoso, Chair of the Panel of Eminent Persons, on United Nations-Civil Society Relations addressed to the Secretary-General," in We The Peoples:  Civil Society, The United Nations And Global Governance.  June 11, 2004, General Assembly 58th session.

8.  We The Peoples, p.8.

9.  We The Peoples, p.9.

10.  Marguerite Peeters.  "Sweeping Assessment of The UN-Civil Society Relation -- Kofi Annan's High Level Panel-Part One".  Interactive Information Services Report 209.  October 17, 2003.

11.  Paper for the Secretary-General's Panel of Eminent Persons on United Nations Relations with Civil Society.  "UN System And Civil Society -- An Inventory and Analysis Of Practices", section VII.  May 2003.

12.  Edwards, Civil Society, p.60.

13.  "UN System and Civil Society," op. cit.

14.  Fourth World Conference On Women, Beijing 1995.  "UN System And Civil Society," section II.

15.  We The Peoples, p.49.

16.  Anderson, "The Limits of Pragmatism in American Foreign Policy," p.374.

17.  "UN System And Civil Society," section VII.

18.  Russell Dalton et al.  "Advanced Democracies and the New Politics".  Journal of Democracy, 2004, vol. 15, no. 1, p.134.

19.  Eight of the world's most distinguished economists were invited to consider ten global challenges selected from a wider set of issues identified by the United Nations.  The panel was asked, "What would be the best ways of advancing global welfare and particularly the welfare of developing countries, supposing that an additional $50 billion of resources were at governments' disposal?"

20.  Report of the Second Survey of the 2020 Global Stakeholder Panel.  "What NGO Leaders Want for the Year 2020:  NGO Leaders' Views on Globalisation, Governance, and Sustainability".  (2020 Fund, 2004).  The survey comprised 521 qualified respondents, including 386 NGO leaders from 90 countries.

21.  Marguerite Peeters.  Hijacking Democracy:  The Power Shift to the Unelected (Washington, D.C.:  American Enterprise Institute, 2001), p.31.

22.  Senator Kay Patterson.  "Transparency Maintained for Growing Engagement between Government and Non-Government Organisations".  (Press release on June 16, 2004 by the Minister for Family and Community Services) "The Australian Government will consider the most effective ways to ensure that the transparency of the growing engagement between Government and Non-Government Organisations is maintained".  In response to Richard J. Wood.  The Protocol:  Managing Relations with Non-Government Organisations (April 2004).

23.  Commission of The European Communities.  European Governance:  A White Paper (European Commission, 2001), p.15.

24.  Social Platform.  "Participatory democracy:  bridging the gap between citizens and the EU", March 13, 2003.

25.  Commission of the European Communities.  "Towards A Reinforced Culture Of Consultation And Dialogue -- General Principles And Minimum Standards For Consultation Of Interested Parties By The Commission", (European Commission, 2002), pp.4-5.

26.  Social Platform.  "The way we are funded".

27.  Commission of The European Communities.  European Governance:  A White Paper (European Commission, 2001), p.15.

28.  Commission of The European Communities.  Report From the Commission on European Governance, (Belgium:  European Communities, 2003), p.16.

29.  EUROPA.  "Grants Awarded by DG Environment in 2003".

30.  For a review of World Bank management of NGOs see Paul Nelson, "Access and Influence:  Tensions and Ambiguities in the World Bank's Expanding Relationship with Civil Society Organisations".  (Ottawa:  The North-South Institute, 2002).

31.  For a discussion of WTO-NGO management issues see Daniel Esty, "The World Trade Organisation's Legitimacy Crisis".  World Trade Review, vol. 1, no. 1, 2002, pp.7-22.  And the response by David Henderson, "WTO:  Imaginary Crisis, Real Problems".  World Trade Review, vol. 1, no. 3, 2002, pp.277-296.

32.  Jan Scholte, "Civil Society Voices and the International Monetary Fund".  (Ottawa:  The North-South Institute, 2002), p.21.

33.  Discussion with Michael Callaghan, Australian representative, International Monetary Fund, October 2002.

34.  International Monetary Fund.  "A Review of the Fund's External Communications Strategy", (IMF, 2003), p.95.

35.  Scholte, "Civil Society Voices and the International Monetary Fund," p.42.

36.  Richard J. Wood.  The Protocol:  Managing Relations with Non-Government Organisations (April 2004).

37.  "The Economic and Social Council may make suitable arrangements for consultation with nongovernmental organisations which are concerned with matters within its competence".  Chapter X, The Economic and Social Council, Article 71.

38.  "UN System And Civil Society," section VII.

39.  Report of Secretary General, United Nations Fund for International Partnerships.  53rd session 1998-99.

40.  Marguerite Peeters.  "The Institutional Dimension Of Partnerships:  The UN Fund For International Partnerships".  Unpublished Interview With Amir Dossal, Executive Director Of UNFIP.  (Interactive Information Services, 2003), Report 201.

41.  The Global Compact Leaders Summit was held on June 24, 2004.

42.  We The Peoples, pp.16-22.

43.  We The Peoples, p.54.

44.  "UN System And Civil Society", section IV.

45.  We The Peoples, p.63.

Radical change not the Liberal way

Most political analysis in Australia is of a personal and short-term nature.

That is why so much discussion about the 2004 federal election result has concentrated on factors such as the qualities of party leaders, the details of their policies and the content of their advertising.

But John Howard's win was the product of more than manoeuvres during the course of a six-week campaign.  More than luck was required to gain four successive victories over eight years, each accomplished under quite different circumstances.

Similarly, mere good fortune cannot explain the electoral dominance of the Liberal Party federally, where it has won 16 of the 24 general elections since 1945.

It is more than a coincidence that three of this country's four longest-serving prime ministers have been Liberal.  Nor is the ascendancy of the non-Labor parties only a postwar phenomenon.  Two of the long-serving prime ministers who held office before 1945, Joseph Lyons and Stanley Bruce, were from the Liberal Party's direct predecessors, while a third, Billy Hughes, spent most of his time in power leading a non-labor coalition.

The political skills of individual prime ministers can only partly explain the Liberal achievement.  While some might be reluctant to admit it, the political philosophy of the Liberal Party, a combination of conservatism and liberalism, is central to the party's triumphs.

This truth is ignored because it reveals Australians to be more sympathetic to the ideals of the Liberal Party than to those of the Labor Party something that is obviously deeply unpalatable to Labor.

The most successful and the most popular Labor government in history was led by Bob Hawke, and his government put in place a Liberal-inspired agenda.

The two men who best understood and communicated the Liberal Party's philosophy, Robert Menzies and Howard, have been their party's most successful leaders.

Conservatism is a doctrine that emphasises the practical over the theoretical and rejects change that is unnecessary or dramatic.  Liberalism stresses property rights, favours the individual and the family over the collective, encourages private choice, and in some circumstances tolerates government intervention in the economy.

Menzies' legacy is more than the economic prosperity of the 1950s and 1960s.  He made it legitimate for Australians to want to aspire to home ownership and to advance themselves and their families.

These attitudes are now such a commonplace that they are taken for granted, even by Labor leader Mark Latham, but this was not always true.  During the 1940s a prominent Labor member of parliament famously argued against home ownership when he said that government should not attempt to make "workers into little capitalists" because then "they would have a vested interest in the continuance of capitalism".

There is widespread agreement that the economic credentials of the parties played a significant role in determining this election, as indeed they have done in practically every Australian election since Federation.  Voter concerns over unemployment in the 1950s, inflation in the 1970s and interest rates in the 1990s were all manifestations of a preoccupation with the economic wellbeing of individuals.

Issues about economic wellbeing are grounded in liberalism, for at their core they are questions about the condition of the individual's material property.

Our trait of so-called "egalitarianism" is an extension of this liberalism because it embraces the idea of equal opportunities for individuals, regardless of their status or wealth.  A society of equal opportunities is not a society of equal outcomes a point often forgotten by the political left.

Despite the best efforts of some members of the Labor Party to portray it as such, our political history is not about entrenched social division and class warfare.  Instead, it is the story of ongoing tension between liberalism and conservatism.

The Liberal Party, which self-consciously regards itself as the custodian of these traditions, has reaped the electoral benefits of its position.

Howard's 1996 campaign slogan, "For all of us", summed up both his rejection of special-interest politics and offered a vision of a united nation, following in the rhetoric of Menzies and then Hawke.

The Labor Party, by defining itself against things to which it is opposed, has developed a strong identity but it has come at the price of losing touch with the electorate.  The party's romantic tilts at massive social transformation such as Ben Chifley's bank nationalisation scheme, Gough Whitlam's frolics and Paul Keating's republic, all failed.

Attempts at radical change from the right likewise succumbed to the conservatism of the community, for example John Hewson's Fightback.

Australians will tolerate change but it must be either gradual or required by necessity.

In the course of three decades of public life, Howard has shown himself to be sensitive to this realisation.

The question to be faced those urging Howard to undertake a radical reform agenda now that the Senate's obstruction has been removed, is whether either of these two conditions for change are satisfied.

As yet, it is impossible to know.

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Freedom and justice are alive and well: Australians care

Those who wanted to rid the nation of "the lying rodent" aka the Prime Minister, John Howard, should relax and have another pinot noir.  Regardless of the Coalition government's return, ethics still matter in public policy and Australia continues to be governed by laws -- democratically framed and judicially reviewed -- that reflect a rich and strong attachment to freedom and justice.

Those who believe that the Prime Minister lied to them prior to the 2001 election about children being thrown overboard by their refugee parents, cannot escape the fact that if the people did not do so in that instance, they certainly scuttled the boat:  an action that put all of the refugees at risk.  It was also declared by the RAN that on at least a half a dozen other vessels children were threatened with being thrown overboard.  Not that those actions themselves justify a policy of incarceration for refugees.  There are other perfectly acceptable grounds to do that, but the incidences leave the moral ground less high for those who would argue for a non-custodial policy for refugees.  There was no failure of ethics in the formulation of the policy towards refugees, just a decision that ultimately helped to stem the flow of those who risked their lives in unseaworthy boats.

Those who believe that Australia invaded Iraq on false pretences cannot rely on the UN for a superior set of ethics in these matters.  The UN may pass fine resolutions -- and in fact did so on 14 occasions -- to have Saddam Hussein give up his weapons of mass destruction or prove conclusively that he no longer possessed them.  Ineffectual resolutions tend to aspire to the highest ethical standards, but the UN has neither the independent intelligence nor the armed forces to help anyone.  Meanwhile Darfur burns and the UN, embarrassed, waits for the US cavalry once again to ride to the rescue.  Hate the US at your peril next time you want the world's policeman to help.  And do not wait for the EU to come to the rescue, those states have so submerged their sovereignties as to be of little use to anyone outside their common border.  There was no failure of ethics in the decision to invade Iraq in the absence of a further UN Security Council resolution, just the chance to remove a killer regime and to allow Iraqis to start again.

Australia is not "unethical" because a government had to make some hard calls.  There are consequences in not making those calls and I am certain a Beazley government would have done the same in the circumstances.  It may come as a surprise to those who think that "documentary" makers Michael Moore and John Pilger tell the truth:  or that journalists David Marr and Margo Kingston are other than political activists:  or that political activists Bob Brown and Tim Costello are especially competent to run a nation:  or that philosophers Michel Foucault and Peter Singer have a way of thinking fit for anything other than a one way trip to the madhouse.  But more Australians are more in control of their destiny, dare we say, less "oppressed" and more "empowered", than has ever been the case.

More broadly, if an ethical politics means establishing a "set of principles of right conduct" or a "system of moral values" then Australia has been on that journey for a very long time.  Australia is fortunately not the "materialistic, post-modern and post-Christian society" some would surmise.  Australians care about right and wrong, they may have different versions of right or wrong to others who consider themselves more able to judge these matters, but if those named above are among the judges, like most Australians, I would just as soon be my own judge.

For those who, as I do, view postmodernism as "the ungrateful enfant terrible of the Western intellectual tradition" we may ask what public policy would the post-modernists suggest.  If postmodernism is a reaction to rationalism, science and objectivity, then we could expect the worst.  We could expect an economy governed principally for "equity" rather than wealth creation, and lose both.  We could expect a legal system guided by personal values rather than distilled consensual values, and lose certainty in the law.  We could expect environmental policies to be framed by anti-scientific "evidence" and a mis-specification of risk, to the detriment of the environment.  We could expect a welfare system so finely tuned to the immediate wants of the individual that the individual would disappear as an autonomous actor.  We could also expect less space for the private domain and more issues belonging to the public domain, and we could expect more problems to be shared and therefore more problems.

Postmodernists "dissolve the distinction between fact and fiction", so that for instance, in a discipline which claims to be describing reality, such as history, one can invent a past which suits a present political objective.  Aboriginal policy could take a long time to free itself from the destructive indulgence of pretending that some cultures are so different that some cannot enter the secret and sacred world of the "other".  In reality, the "veil of culture" is used to screw resources from the system.  If the likes of Keith Windschuttle had not shone the harsh light of evidence on the "frontier wars" myth of recent historiography, it would take even longer to break the shackles of Aborigines being untouchable.  Cultures are not so radically different from one another that we should dismiss the laws of scarcity or wish a previous crude mode of living to survive in the modern world.

Judging by the iconic issues -- Refugees, Iraq, and Aborigines -- those who seek a better ethical standard in Australian politics, cannot make the case that the current policy settings are devoid of ethical standards.

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Wise Policy Trampled in a Frenzy of Self-interest

The 2004 federal election will go down in history as an opportunity lost.  We had the chance to use "reform dividend" to address some of the challenges facing the nation.  There was also the potential to further remove the regulatory barriers that hinder employment growth, investment and saving.

Instead of billion-dollar promises to a fortunate few living in marginal seats, we could have had a tax system that operated for the benefit of all Australians.  Individuals in work would have been better rewarded for their efforts.  Those looking for work would have been given better incentives to leave welfare.

The campaign has left the electorate cynical and complacent.  If parties run a campaign appealing entirely to self-interest, based on the assumption that the good times will last indefinitely, then cynicism and complacency result.

It is not that the Coalition or Labor ignored the big issues;  the problem lies with their solutions.  In most cases, both sides offered little more than more government -- more taxes, more spending, more bureaucracy and more regulation.  It was a return to tax and spend policies.

Thanks to a buoyant economy, driven by decades of economic reform, the commonwealth has experienced high revenue growth during the past eight years, pushing the budget into surplus.  There was the capacity to return government revenue to those who earned it in the first place -- taxpayers.  This is not what has happened.  While both the Liberals and Labor trumpeted tax cuts, in fact they did little more than give back the proceeds of bracket creep.

The national saving rate is just about zero, which is ominous given the ageing of the population and the low stock of savings held by many baby boomers.  The national superannuation scheme established by the Hawke government was a worthwhile initiative.  However, its effectiveness was limited at birth by excessive regulation and, subsequently, excessive taxation.

These burdens have increased during the past decade, imposing exorbitant costs and rendering the system incomprehensible even to experts.  This has been done under the banner of protecting investors from themselves, but in reality has protected the commercial interests of the superannuation industry.  What is needed is policy aimed at injecting freedom of choice and personal responsibility into the industry.  Neither party took up the challenge.

Our health system is not broken.  There is no crisis in the hospital system, or shortage of nurses or doctors, and waiting lists are not exorbitant.  The system does face pressure on demand and costs, and is long overdue for systematic evaluation.

Neither party gave even a hint of undertaking a serious evaluation of the health system.  One of its key strengths -- that it requires people to contribute out of their own pocket to the cost of their care through private insurance or co-payments -- is being undermined.  This is essential not only for funding of the system but as a signal to people that medicine is not an unlimited and free good.

Our federal system of government is broken.  It has been in decay for decades.  But the GST has effectively destroyed any remaining vestiges of utility in the system.  The states have become spending agents without accountability.  They are sheltered from accountability by a perverse federal grants system and the fact the commonwealth raises nearly half of the states' revenues.  Both parties seem willing to have the commonwealth government assume responsibility for practically every ill that besets society.  There is no recognition that at least some of our problems are caused by too much government.

John Howard and Mark Latham like to stress the notions of responsibility and self-reliance.  Nothing destroys these notions more effectively than a government effectively saying it can make better decisions than individuals and families.

Latham as a backbencher once wrote:  "Only the political equivalent of Austin Powers could believe that government intervention achieves better results than market forces".  On becoming Opposition Leader, it appears that he was quickly disabused of such ideas.  Latham has made commitments to reducing market forces in practically every area of the economy including universities, the retail and financial sectors, and the media and telecommunications industry.

The Coalition's tactics are more difficult to comprehend.  They have been one of the talking points of the campaign.  Is it true that Howard has jettisoned his long-held political beliefs about government financial responsibility simply to achieve a fourth term?  Some of his commitments are consistent with an approach that promotes choice;  for example, rebates on private health insurance and allowances to working mothers.  But, overall, the impression remains that most of the Coalition's promises do little to strengthen our long-term productive capacity.

Australians have many great qualities, but our capacity to plan for the future is not one of them.  The reforms of the 1980s, which produced the economic growth from which we are benefiting, were the product of a crisis.  The political leaders of the time -- Bob Hawke, Paul Keating and, it must not be forgotten, Howard in Opposition -- understood the crisis and responded to it.  They also did one other essential thing.  They communicated the need for change to the electorate.

But all is not lost.  Whoever wins the election will have a strong mandate to provide economic leadership and thus have the opportunity to rebuild the case for reform.  They need support.

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Aboriginal Policy: Romantics and Realists

The major parties' Aboriginal policy is a contest between romantics and realists.  The split is not strictly along party lines.  The Federal Coalition's "practical reconciliation" is not sustainable, and waiting years to abolish ATSIC was timid.  Nevertheless, it does not suffer the romantic myopia of Federal Labor, which has announced a further $360 million spending on programs in the "social justice" mould that have failed in the past.  Fortunately, some Labor administrations, notably NT and Queensland are beginning to talk a new language in Aboriginal policy:  incentive and disincentive.  They are joining the realist camp.

The newest recruit to the realist camp is Senator Amanda Vanstone, the Minister for Aboriginal Affairs.  She has said what has needed to be said for a long time.  "It is far more effective for people to change behaviour than for governments to invest in patching up problems".  She has announced that unconditional welfare will be abolished.  Residents of remote communities will no longer be exempt from the mutual obligation requirement, and the Community Development Employment Program will enforce "no work, no pay".

As important as changing incentives to change behaviour, is having the honesty to admit that only a handful of remote communities have a life beyond welfare.  Vanstone says, "we must sit down with communities and tell it like it is.  How can they think about their future if we're too afraid to present the facts to them?"

The facts are that since 1981, the Aboriginal population in remote areas has grown by more than 20 per cent.  There are about 1200 discrete Aboriginal communities with a total population of over 100,000.  Almost 900 communities contain fewer than 50 persons.  The romantics think this is wonderful;  an Aboriginal nation arises!  The reality is a disaster for the inhabitants.

The Commonwealth and others invest $20m in a Desert Knowledge Cooperative Research Centre to dream up ways of generating income in remote areas, but in Katherine NT, mangoes are picked by migrant labour because the local Aborigines do not make themselves available.  The local school at Kowanyama in Cape York cannot get a local to clean the school.  The school bus at Oenpelli NT circulates three times every morning to pick up the stragglers who are not ready for school.

The public phone at Punmu in WA is broken constantly.  Telstra has a contractual obligation to remote customers, so within 2 days it flies two techs hundreds of kilometres to fix the phone.  The next time someone has a fight, the phone is smashed and Telstra responds.  Governments are spending thousands to float Aboriginal businesses, but thirty years ago the bakery, the market garden and the repair shop each existed without such help.

The reason for each of these failures is because the incentives are wrong.  As the Labor Minister for Central Australia Peter Toyne has said, "Taking away the safety net ... would be an enormous step for this country to take".  There are simple incentives like the one at Wadeye NT, where the policy is "no school, no pool".  The children who do not attend school do not have use of the pool.  Those who do are noticeably healthier, and they pay to use!  And there are essential disincentives, like Family payments should be paid conditionally on the parents insisting on the child attending school.

Both political parties are experimenting with the regional delivery of services;  both confuse ends with means by assuming that better delivery of services is the solution.  A person dependent on free services for their existence will not become less dependent with more service.

Above all, Aboriginal children in remote areas must attend residential regional colleges, like Spinifex College at Mt Isa.  As one student said, "I needed to get away from Normanton and here I have houseparents that have encouraged me and looked after me as a person.  They are interested in what I do.  It wouldn't have happened if I had stayed in Normanton".  And another, "There's too much about stereotypical stuff in schools which builds barriers like just because I'm black the best person to help me needs to be black, too.  This is not true.  They just need to know me".

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Labor's weak spot showing

Why is it that in this election the ALP finds itself confronted by open business opposition to its industrial relations policies when the ALP claims its policy is "light touch"?

The reason is simple:  any detailed study of federal ALP policy shows that it will turn the industrial relations system into a super regulator of management, making direct worker--management discussion and agreements too complex to do in practice.

Business has become used to the Howard government's Workplace Relations Act which has a few key features.  First, it focuses on protecting worker entitlements under core awards.  Then it offers workers and managers three options:  collective agreements with unions;  collective agreements without unions or individual agreements (AWAs).

Further, the 28 per cent of the private-sector workforce who are not employed but are independent contractors can work outside industrial relations control under commercial contracts.

By comparison, the ALP policy would do the following:  expand the reach of industrial relations into commercial contracts;  push independent contractors into the industrial relations net;  remove the individual employment agreement option;  and give unions authority over all collective agreements removing the non-union option in all but name.

It goes further.  ALP policy announces a new but unexplained wage-setting system, including reintroduction of paid rates awards for the public service.  It then ties government procurement policy to its industrial relations policy.

The Federal ALP policy will, following New South Wales industrial relations legislation, expand the Industrial Relations Commission into purely commercial areas.  In NSW, the IRC has begun to rule on commercial tenancy leases and franchise agreements, and even looks to rewrite business sale agreements retrospectively.  This will happen under Federal Labor and will lead to commercial and management issues being inserted into employment agreements.  This will cause uncertainty and distort commercial and managerial decision-making.

Federal Labor also plans to follow NSW's lead, allowing enterprise agreements that inhibit the use of labour hire, force unrelated companies into union agreements, deliver control of training to union bodies, require non-unionists to pay unions fees, facilitate committees that usurp management authority, and restrict the ability of firms to negotiate union EBAs.

Federal ALP also proposes Queensland-style legislation that denies independent contractors their right to be independent contractors.

Finally, federal ALP goes further than NSW and Queensland where, under the terminology of "good faith bargaining", it would be illegal for businesses not to enter industrial negotiations with a union and would give the Commission power to force agreements onto unwilling businesses.  In addition, the Commission will have the power to force companies to divulge commercial information.

The package is locked together by downgrading the power of the ACCC under the Trade Practices Act to prevent secondary boycotts.  This is consistent with Federal ALP policy to replicate NSW outworker legislation, which subjects commercial transactions in specified markets to industrial relations legislation and price fixes in those markets.

Australia's business associations have twigged to the ALP agenda and have comprehended its implications.  Hence their opposition.

If federal ALP policy were translated into legislation -- which, judging from the actions of the State ALP Government is on the cards if they are elected -- a dramatically worse, less competitive business environment would emerge.

Business groups say this would destroy the productivity-gain processes that have driven improved profits, increased worker incomes and reduced unemployment -- and they are correct.

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