Saturday, May 30, 2020

The Death Of The Scientific Method

A court case this week in front of three judges of the Federal Court was a further stage in Peter Ridd's fight for freedom of speech on climate change.  The case, James Cook University v Peter Vincent Ridd, has enormous significance for the future of Australia's universities and scientific institutions.

Ridd's case is a dramatic illustration of the free speech crisis in Australian universities, not least around matters as politically and emotionally charged as climate change.  It will determine, in effect, whether universities have the ability to censor opinions that threaten their sources of funding.  It is one of the most important cases for intellectual freedom in the history of Australian jurisprudence.

The Ridd case has resonated around Australia — and has attracted significant attention worldwide — for good reason.  It confirms what many people have suspected for a long time:  Australia's universities are no longer institutions encouraging the rigorous exercise of intellectual freedom and the scientific method in pursuit of truth.  Instead, they are now corporatist bureaucracies that rigidly enforce an unquestioning orthodoxy, and are capable of hounding out anyone who strays outside their rigid groupthink.

JCU is attempting to severely limit the intellectual freedom of a professor working at the university to question the quality of scientific research conducted by other academics at the institution.  In other words, JCU is trying to curtail a critical function that goes to the core mission of universities:  to engage in free intellectual inquiry via free and open, if often robust, debate.  It is an absurd but inevitable consequence of universities seeking taxpayer-funded research grants, not truth.

Worse still, it is taxpayers who are funding JCU's court case.  Following my Freedom of Information request, the university was forced to reveal that up until July last year, it had already spent $630,000 in legal fees.  It would be safe to assume that university's legal costs would have at least doubled since that time.  The barrister who JCU employed in the Federal Court this week was Bret Walker SC, one of Australia's most eminent lawyers.  Barristers of his standing can command fees of $20,000 to $30,000 a day.  And all of this is happening at the same time as the vice-chancellor of the university, Sandra Harding — who earns at least $975,000 a year — complains about the impact of government funding cuts.

While Australian taxpayers are funding the university's efforts to shut down freedom of speech, Ridd's legal costs are paid for by him, his wife and voluntary donations from the public.  As yet, neither the federal nor the Queensland Education Minister has publicly commented on whether JCU is appropriately spending taxpayers' money and, so far, both have refused to intervene in the case.

Ridd describes himself as a "luke-warmist".  "I think carbon dioxide will have a small effect on the Earth's temperature," he told a podcast recently.  "But it won't be dangerous."  He has been studying the Great Barrier Reef since the early 1980s and was even, at one point, president of his local chapter of the Wildlife Preservation Society.

But Ridd is sceptical about the conventional wisdom that the Great Barrier Reef is dying because of climate change.  "I don't think the reef is in any particular trouble at all," he says.  "In fact, I think it's probably one of the best protected ecosystems in the world and virtually pristine."

The problems Ridd's views cause for JCU are obvious.  The university claims to be a leading institution when it comes to reef science, and has several joint ventures with taxpayer-funded bodies such as the Australian Research Council Centre for Excellence in Coral Reef Studies.

Ridd challenged his sacking in the Federal Circuit Court on the basis that the university's enterprise agreement (which determined his employment conditions) specifically guaranteed his right to "pursue critical and open inquiry", "express unpopular or controversial views", and even "express opinions about the operations of JCU and higher education policy more generally".  In September last year, Ridd won his case as the court found he had been unlawfully sacked and he was awarded $1.2m in damages and compensation for lost earnings.

The case in the Federal Court this week was an appeal by JCU against that decision.  At issue was whether the intellectual freedom clauses in the enterprise agreement covering JCU staff protected his criticism of quality assurance issues in reef science at the university.  The university alleges that in going public with his concerns that organisations such as the ARC Centre "cannot be trusted" on reef science, Ridd committed several breaches of the university's staff code of conduct, with its vague, faintly Orwellian requirements to act "collegiately", and to "uphold the integrity and good reputation of the university".

In other words, even though the enterprise agreement specifically declared that staff had the right to intellectual freedom, it was for the university to determine the limits of what that freedom actually permitted.  If it is accepted, it will be the death knell of free intellectual inquiry in Australia's universities.  As Ridd's barrister, Stuart Wood QC, said to the Federal Court:  "If you can't say that certain science cannot be trusted because it is 'discourteous' and 'not collegial', then you cannot call out scientific misconduct and fraud.  It's not just the end of academic freedom, it's the end of the scientific method.  At that point, JCU ceases to be a university and becomes a public relations outfit."

An academic who doesn't have the ability to challenge the research findings of their colleagues because those questions threaten the university's funding doesn't have intellectual freedom.  And if academics know they could get sacked, as Ridd was, for asking uncomfortable questions, they will stop asking uncomfortable questions.

Academics should of course be open to criticism — particularly for some of their more outlandish conclusions — but as a matter of public policy it is vital that universities be places where bad ideas can be expressed as well as good ones.  The difference between the former and the latter should be resolved by free and open debate, not opaque "disciplinary processes".  We may not like what university professors say, but a strong university sector requires that we defend to the death their right to say it.

It is up to the Federal Court now to decide exactly how far universities can go to censor and sack their staff.  But in Ridd, James Cook University has one professor who will not go quietly.

Friday, May 29, 2020

Red Tape Holds Back Growth

The WA state government is leading the way for a post-lockdown recovery based on slashing business-crushing red tape to support small businesses.  Premier McGowan's moves to make it easier for certain businesses to change how they use their premises and streamline the process for single development applications are welcome.  However, the Government can and must go further in cutting red tape to make WA an economic powerhouse in the wake of the devastating lockdown which has smashed the productive private economy.

Red tape imposes an enormous burden, reducing economic output to the tune of $176 billion across Australian each year.  While this is a dangerous handbrake on prosperity, it is also a serious moral issue.  By preventing people from starting new businesses, innovating new products and creating opportunities for themselves and their families, red tape stifles the aspirational spirit that drives so many West Australians.

My recent analysis estimated that the private sector has been crippled by the coronavirus lockdowns, while the public sector remains relatively unscathed.  Jobs in the private sector have decreased by 7.7 per cent since the middle of March while the public sector has seen only a 1.7 per cent decline.

Despite politicians insisting that "we are all in this together", their pay and hours remain the same while 1.3 million people have had to work fewer hours and another 900,000 have lost their jobs entirely, according to data from the Australian Bureau of Statistics.

This environment, where the private sector is punished while the public sector remains unscathed, cannot be maintained if there is to be an economic recovery.  The private sector accounts for 80 per cent of economic activity, and it is only by taxing this activity that we can afford public services such as roads, schools, and hospitals ― including ICUs for coronavirus patients.  The number one priority must be maximising this wealth creation, and slashing red tape is one of the best ways to do this.

The link between red tape and economic prosperity is clear.  Cutting red tape allows for more businesses, more jobs, and higher wages.  It allows people to experience the dignity of work, and encourages people to be enterprising by reducing unnecessary compliance costs.  Most importantly, red tape disproportionately impacts small businesses, so cutting red tape will provide a boon to sole traders and family-run businesses across WA.

Small businesses are vital to the West Australian economy.  According to the most recent data from the ABS, there are 226,416 small businesses in WA.  At least there were before the lockdown started in March.

Creating new businesses is essential to the economic recovery.  Small businesses don't just provide an income to their owners and employees, they provide a sense of community and a ladder to prosperity.

WA has been incredibly successful in containing COVID-19, and has done so without carelessly treading on freedoms as the Eastern States so willingly did.  The WA government should quickly lift the remaining restrictions on businesses, while maintaining social distancing and hygiene requirements.

After allowing all businesses to reopen, Mr McGowan must slash red tape.  The tentative steps taken in this direction are encouraging, but there is no shortage of overzealous regulation that can be discarded.  WA has 107,812 individual regulations on the books, according my analysis published last year.

Food truck owners who want to set up at the local park or do the rounds of the suburbs are simply not allowed to do so.  They can only serve customers in registered areas and at certain events, all of which have been cancelled.

Chauffeurs who have seen their bookings drop by 80 per cent or more are still required to pay 10 per cent of every fare to the government's taxi plate buy-back scheme.  And that's in addition to GST.

And when a Perth surgeon wanted to start an intimate, high-end wine bar on William Street, he was forced to spend upwards of $12,000 on communicating with police about his liquor license.

This kind of onerous and petty red tape is simply unaffordable in the post-COVID-19 economy.

Mr McGowan must set an example for his Eastern States peers.  By slashing red tape, the Government will allow West Australians to create a bonanza state once again.

Thursday, May 28, 2020

Exposed:  The True Scope Of Lockdown Unemployment

The official unemployment rate released by the ABS hides the true impact of the lockdown measures on the economy and employment.  In addition to the 823 thousand unemployed, there are 1.26 million Australians who have been forced out of work since March following the lockdown that are not included in the unemployment rate.

The unemployment rate for April jumped to 6.2 per cent, up from 5.2 per cent in March.  The increase was substantially lower than many forecasts.  Following the release of the unemployment rate Treasurer Josh Frydenberg stated the lower than expected rate "reflects the success of the JobKeeper program".

The JobKeeper program has allowed many businesses to continue to operate and provide their employees with work, but it has also masked the true extent of unemployment by shifting people who are without work out of the unemployment number.  The unemployment rate is the number of unemployed divided by the labour force consisting of both employed and unemployed.  The rate, therefore, does not include employed people working zero-hours or those who have left the labour force altogether.

In March there were 13.7 million people in the labour force.  This included 13 million people who were employed and 719 thousand people who met the unemployment criteria of actively searching for work and available to work in the reference week.  In April the labour force fell to 13.2 million people with 12.4 million employed and 823 thousand unemployed.

This means an unprecedented 490 thousand people left the labour force since March, meaning that they are not employed and do not meet the unemployment criteria.  A further 770 thousand people according to data released last week by the ABS have been classed as employed but for economic reasons are working zero hours.  These individuals are reported by the ABS as having "no work, not enough work available, or were stood down" and are likely to be receiving the JobKeeper payment.

Including as unemployed the 490 thousand Australians who were part of the mass exodus of the labour force and the 770 thousand who are employed but working zero hours for economic reasons, in addition to the 823 thousand counted officially as unemployed, gives a staggering unemployment rate of 15 per cent with over two million people being without work.

JobKeeper should not be deemed successful because it has suppressed the official unemployment rate.  The Commonwealth Government has, in effect, created a way for people to receive unemployment benefits without contributing to the unemployment rate.  In effect, businesses who employ zero-hour staff have become a type of pseudo Centrelink.  The only difference is a zero-hour employee may be eligible for a $1500 fortnight payment compared with around $1,100 from the JobSeeker unemployment payment.

There is no substantial difference between someone out of work receiving JobSeeker and someone out of work receiving JobKeeper.  One is deemed to be unemployed and receives a government payment, while the other is "employed" but working zero hours and receives a "wage" fully subsidised by the government.

The real test for JobKeeper will come when the payments cease, with the program currently slated to end on 27 September, six months after it began.  The purpose of the scheme is to keep businesses afloat through the lockdown so that they can employ in the future without government subsidised wages.  At this stage, it is not known how many businesses are simply walking dead, maintaining a semblance of operation to allow their staff to access JobKeeper but with no prospect of being able to stand on their own feet after September when the JobKeeper payments end.

The momentous task of getting two million Australians back into work will not be achieved without the government undertaking serious economic reform.  Lifting the lockdown measures will allow many people to return to work, but thousands of others will find that there is simply no job to return to.

To allow the private sector to rebuild, generate jobs, and provide the dignity of work, businesses need to be freed from excessive levels of red and green tape.  Small businesses, that employ more than 40 per cent of Australian workers, need to be freed from the shackles of the Fair Work Act that destroys jobs and prevents hiring.  And Australia's crippling high energy costs caused by government schemes pushing renewables needs to be urgently addressed.

Aiming at simply returning to business, as usual, will ensure that thousands of Australians will find themselves out of work for a long time to come.

Friday, May 22, 2020

Voice Of Small Business Is Silent On The COVID-19 Commission

Senator Michaelia Cash is the Minister for Employment, Skills, Small and Family Business in the Morrison government.  It's one thing for a minister to have such a title.  It's another thing entirely for the government to take that title seriously.

It might have been that the minister was absent when the Morrison government was busy selecting the members of its National COVID-19 Coordination Commission.

The commission was announced by the Prime Minister in March and it has six commissioners.  Its task is to "ensure the government receives the most comprehensive advice to meet the challenges ahead to cushion the economic impact of the coronarvirus and help build a bridge to recovery".

The commissioners, by virtue of their role, are now some of the most powerful people in the country.  They're advising the government on nothing less than the future of the Australian economy.  And when you design an economy, you design a society.

The six commissioners are Nev Power, who was chief executive of Fortescue Metals Group;  David Thodey, who was chief executive of Telstra;  Greg Combet, who was secretary of the ACTU and a minister in the Rudd and Gillard Labor governments;  Jane Halton, a career public servant;  Paul Little, who was managing director of Toll Holdings;  and Catherine Tanna, who is managing director of an energy company.

That's four commissioners from big business, one from the public service, and one from both the trade union movement and the Labor Party.

Missing from the commission is the voice of the sector that accounts for one-third of the economy, that provides more than 40 per cent of the jobs in the private sector, and that is the foundation of a free enterprise economy.  That voice, of course, is that of small business.

It is small business and the families of the owners of small businesses ― not big business and not the public service ― that are bearing the brunt of the government-imposed shutdown of the economy.  Seventy per cent of small businesses are family-owned.

My analysis of Australian Bureau of Statistics data shows that over the past three months jobs in the private sector have been lost at 4½ times the rate of job losses in the public sector.  Most of those lost jobs will have been from small business.

In fact the government is doing everything it can to ensure public servants are untouched by what's happening in the rest of the economy.

Although nearly 75 per cent of Australians support pay cuts for politicians and public servants earning more than $150,000, the Prime Minister has categorically ruled out any such reduction.  The biggest sacrifice Scott Morrison has offered is to delay pay rises for some public servants.

It's incredible that a perspective from the sector that employs 4.5 million Australians (or at least did until March) is not represented on the commission.

If and when the unemployment rate reaches 10 per cent or more, the vast majority of those who will have lost their jobs will be small business employees.  By the end of March, approximately 8 per cent of small businesses had already stopped trading because of COVID-19 restrictions, while 61 per cent of small businesses have applied, or will apply, for wage subsidies from the government.

The Australian economy won't recuperate and employment will not grow in any meaningful way until small business recovers from the economic shutdown.  The future of small business should be front and centre of the government's attention, not an afterthought ― if that.

It's frightening to contemplate, but maybe what happened is that those who picked the commissioners thought if you're deciding how to save the Australian economy, the only people you need an opinion from are those who inhabit the cosy club of the Qantas Chairman's Lounge:  big business bosses, public servants, and former union officials and Labor politicians.

It is revealing these are the sort of people the Morrison government picked to advise it.

Presumably, no one in the Coalition thought to ask the cafe owner in Parramatta who has just laid off all their staff, shut their business and lost their livelihood, whether they would like to be on the National COVID-19 Coordination Commission.

Wednesday, May 20, 2020

Why JobKeeper Cannot Be For Keeps

Last week the Australian Bureau of Statistics reported that Australia had a 6.2 per cent unemployment rate.  Based on the collapse in hours worked, however, I guesstimate the jobless rate is closer to 9 per cent.  An increase from 5.2 per cent unemployment to almost 9 per cent in just one month is a catastrophe.

To be fair, things could be worse.  The federal government has committed to borrow an eye-watering sum of money and is subsidising businesses to maintain employees on their payroll.  Right now a lot of people are still receiving an income, despite not actually working.

JobKeeper is not the most finely calibrated assistance package an Australian government has ever produced.  But given the circumstances and the radical uncertainty government faced in the early days of the COVID pandemic, it is a pretty good effort.  In principle, it could be fine-tuned, but that would be mean-spirited.  Promises were made and promises should be kept.

One promise, in particular, should be kept:  JobSeeker ends in late September.

Some have suggested that JobKeeper be maintained or that it evolve into a Universal Basic Income (UBI).  The intellectual case for a UBI is bolstered by the fact that even free market economists such as Milton Friedman and Friedrich von Hayek supported the idea.  But UBI is a solution looking for a problem to solve.  Right now the economic problem Australia faces has a different solution.

The economic response to the COVID pandemic has been the greatest economic intervention in human history.  Governments ― Australia included ― have tried to freeze their economies in place, until the medical crisis is under control, and will then attempt to unfreeze their economies.  The hope is that the economy will "snap back" into place and then all we need do is pay off the public debt.

Many economists at this point talk about V-shaped recoveries, or "swoosh" recoveries and so on.  If the economy doesn't immediately pick up, the argument goes, maybe we should keep JobKeeper for longer.

Well, no.

JobKeeper, at the very best, can only be a temporary solution to a temporary problem.  It worked to prevent Australia's social fabric from unravelling in the face of a medical emergency and a policy-induced economic catastrophe.  Over the years and decades to come, we will debate the necessity and urgency of those decisions.  Right now that debate is a luxury we cannot afford.

JobKeeper will do nothing to restore our prosperity.  In fact, the traditional tools of public policy are exhausted.  Public debt has already blown out and monetary policy is ineffective.  The economic challenges facing Australia ― and many other countries too ― are just starting.

The bottom line is that we as a nation simply cannot afford to pay people to sit at home and not produce.  Now some economists will tell us that JobKeeper is a transfer and not a cost and so we have nothing to worry about.  Others might tell us that public debt doesn't really matter because we're really just borrowing from ourselves.  Whatever.  The economy is not a perpetual motion machine running on fairy dust or unicorn farts.

The economic challenge that we now face is getting Australians back to work.  Sit-down money had a place in securing our health ― but won't help in the next phase of recovery.  Our economy is a lot smaller now than what it was at the beginning of the year.  Australians are a lot poorer than what we were.  The JobKeeper payments largely are disguising that loss of wealth.

Many government regulations, policies, and dare I say it entire agencies are now luxuries that we might have been able to afford in January, but not now.  Anything that impedes employment or investment in the economy should be jettisoned.  Australian governments have already done a fine job in suspending regulations and some taxes for the duration of the crisis.  That just tells me that they already knew which regulations were unnecessarily burdensome on the economy.

Australians don't just want to recover from the crisis ― we want our pre-COVID prosperity restored.  That means a long sustained period of high economic growth ― to pay down our increased public debt and restore household balance sheets ― not to mention income statements ― to their pre-COVID levels.  That can only be done in a low-tax environment with appropriately reduced levels of regulation.

Tuesday, May 19, 2020

What About Relief From The Student Services And Amenities Fee?

While Daniel Andrews hands out thousands of dollars to international students in Victoria, domestic students are left to foot the bill as they continue to pay fees for services that do not exist.

The Student Services and Amenities Fee is a compulsory upfront payment of up to $308 introduced by the Gillard government in 2011.  This repackaged form of compulsory student unionism, where fees are set by the university but with a large portion going to the union or guild, has resulted in a conflict of interest that has left domestic students without a voice at a crucial time.

Generation Liberty has discovered that the majority of public universities in the state of Victoria are continuing to charge this fee, with the exception of La Trobe, which waived the fee, and Deakin University, which switched all students to the lower online student fee.  There are currently no sports events, club meetings or student barbeques, but the money for them is still being collected hand over fist.

This is at a time when a large proportion of university students are suffering from severe financial strain.  My research has shown that younger Australians have been some of the hardest hit by the economic lockdown.  With sixty per cent of 18 to 24-year-olds having lost their job, had their hours cut or had their salary reduced.

Student unions and guilds have remained strangely silent on this issue.  This could be because they receive the lion share of their funding from SSAF.  Student unions are supposed to be a voice for students and hold universities to account.  Right now, universities is effectively paying off that voice.

Their self-interest is made clear by the fact that they have not been silent when it comes to other student fees.  The University of Melbourne Student Union recently released a video calling for fee relief.  To support their demand, the USMU sighted their recent survey report of 6,421 students, which revealed 89.41 per cent are in favour of fee reduction.  SSAF was not mentioned once in the 15-page report.

UMSU and many other student unions are conveniently choosing to focus on long-term fees, which in most cases will be added HECS and paid at a later date for domestic students, instead of the much more immediate issue of the compulsory SSAF, which is paid upfront.

$308 in students' pockets now would provide much more immediate relief than a slightly reduced HECS fee in 5 years' time.  Despite this, the idea of even reducing this payment has not been raised by the UMSU.

This admission is even more glaring when a neighbouring university is doing the right thing and waiving the fee ― La Trobe University is even providing a refund service online for those who have already paid the fee.  So obviously this is not an unreasonable request.

Some universities and student unions have claimed these on-campus services will now be provided online.  The University of Melbourne explains on their website that "Many SSAF funded services are being redesigned for our virtual campus, with a stronger focus on student wellbeing and a sense of belonging and connectedness across our student community".

"Wellbeing" is a subjective term.  For example, UMSU recently held an online workshop event in collaboration with the group Women's Climate Justice Collective — a national group led by women, aiming to mainstream feminist climate justice, entitled Enviro Workshop:  Feminist Climate Justice.  Which they must have felt would be more beneficial to student body than having the extra money in their pockets.  While this may keep the content producers employed, funding it seems to be an unfair burden for students when so many of them have lost their jobs.

What is worse is that many universities, including the University of Monash and Federation University, only charge these fees to domestic students.  This is in spite of the fact that the services thereby funded are provided to all students.

Compulsory student unionism was axed under the premise that it was wrong to force students to indirectly fund political campaigns that they disagreed with.  It was brought back under the premise that it was only going to be a fee for tangible amenities.

It is clear from the actions of the universities and their unions that this justification was a farce.  It is time to scrap the SSAF.  Universities should make a point of putting their students first.

Wednesday, May 13, 2020

The Economic Statement:  Business As Usual Won't Defuse Our New Debt Bomb

Treasurer Josh Frydenberg yesterday delivered a sobering economic statement to Parliament.  In stark contrast to the premature "back in the black" celebration just 12 months ago, the Treasurer detailed the "significant increase in government debt which will take many years to repay".  In the absence of any meaningful scrutiny from the opposition, the coronavirus pandemic has effectively given the government a free cheque without the burden of justifying the severe measures it has taken both in terms of the lockdown and the fiscal response.

Total Australian debt has already blown out to $618 billion, up $50 billion since December.  The increase in borrowing has been a result of a $11.3 billion collapse of government revenue compared to the pre-COVID-19 forecasting.  Total debt is set to spiral over the coming years as the government's spending commitments in response to COVID-19 get underway and as government revenue is further damaged by the ramifications of the lockdown and reduced investment.

Seven million Australians have received the first $750 instalment of household support, 1.4 million are receiving the JobSeeker unemployment benefit, and 835 thousand businesses employing 5.5 million workers have enrolled for the JobKeeker wage subsidy.  This means that nearly one in three Australians in the labour force (65 per cent) are now dependent on the taxpayer by either being directly employed by government (15 per cent), receiving JobSeeker (10 per cent) or JobKeeper (40 per cent).

In response to the Government's unprecedented $320 billion package, the opposition's main concern has been that they haven't drowned Australia in debt fast enough.  This lack of scrutiny has left several aspects of the government's response unchallenged.

The most serious problem is that the JobKeeper program has only papered over the economic cracks that will be revealed at the end of September when the JobSeeker payments cease.  The scheme has created what Deloitte Access Economics have termed zombie companies, many of which were struggling before the lockdown even began.  The full economic impact of the lockdown will only start to become apparent once those businesses relying on JobKeeper are forced to sink or swim.

The application of JobSeeker to part-time and casual workers earning less than $1,500 a fortnight has been poorly planned.  The requirement for businesses to pay these workers the full $1,500 regardless of hours worked has created very foreseeable work incentive issues, with businesses reporting difficulties getting their staff to take work, and workers working additional hours for no increase in pay.  New Zealand's system that allows businesses to pay these workers their normal wage and put the remaining subsidy to other wage expenses should have been followed.

The government's household support payments consisting of two instalments of $750 to those receiving government support at a cost of $8.8 billion has also been poorly targeted.  The announcement of that policy came ahead of the more highly targeted temporary increase of JobSeeker and the introduction of the JobKeeper payment.  The government has proved itself unwilling to spend political capital to rein in the poorly targeted scheme in the interest of taxpayer's money.

But the question now will be how the government plans to repay their massive expansion in debt.  Frydenberg was right when he stated, "Australians know there is no money tree.  What we borrow today, we must repay in the future".  The problem for the Coalition is that contrary to Frydenberg's suggestions, the Coalition's budget repair work since forming government in 2013 does not provide the blueprint for the way forward.

The business as usual approach of exercising spending restraint and waiting for government revenue gains to chip away at the deficit is simply not an option.  The government needs to take bold steps to ensure that the newly acquired debt does not get out of control.  While interest rates are low now, there is no guarantee what the cost of borrowing will be five to ten years from now.  Borrowing costs will also increase should Australia lose its triple-A credit rating.  If it took the government seven years to return the budget to surplus before COVID-19 in a period of economic growth, it is very unlikely that the debt repayment will have even begun before interest rates rise.

The sobering truth is that there is no easy way out of the fiscal situation.  Importantly, Fydenberg emphasised the necessity of productivity-enhancing reforms, cutting red tape, and reform of the taxation and industrial relations systems.  It is paramount that the Government's rhetoric is backed up by real action in these areas.  But with the size of the deficit and debt on the horizon, the crucial tool of budget repair was a glaring omission:  the necessity of reining in wasteful government spending.

Tuesday, May 12, 2020

University Of Queensland Takes Action Against Its Own To Curry Favour With China

We should all care about the case of 20-year-old Drew Pavlou, not only because of the injustice of a university intimidating its own student but also because it is symptomatic of the crisis of universities in Australia.

The University of Queensland's predicament did not begin with the news that it was employing one of the country's top legal firms to pursue a member of its own student body, nor will it end there.

On May 20, philosophy undergraduate Pavlou will be required to defend himself against allegations of misconduct, particularly in respect of his vocal criticism of the university's con­nections with China.  This goes far beyond the acceptable behaviour by a public institution.

The Pavlou affair has exposed two things to the Australian public.  First, it has exposed the fact UQ, like so many other Australian universities, is now in an extremely perilous financial position, having made the mistake of putting all its eggs in one international student basket.  Last year, the university had an estimated 53,305 students, 20,213 of whom were international, about half of whom hailed from China.  Last year, the university raked in $679m in direct tuition fees alone.

Second, this is another example of how Australian universities are more focused on their business model than engaging in free intellectual inquiry.  In the same way James Cook University (unlawfully) sacked Peter Ridd for exposing flawed Great Barrier Reef science that was lucrative to its business model, UQ is casting aside an outspoken student.

Last year there were scenes of chaos on campus as 200 pro-Chinese Communist Party students turned up to a peaceful pro-Hong Kong freedom demonstration organ­ised by Pavlou.  In several videos shared on social media, pro-CCP students were seen scream­ing, ripping up posters, playing the Chinese national anthem and assault­ing the pro-Hong Kong students.  The response of the Chinese consul-general in Brisbane, Xu Jie, who happens to be an adjunct professor at the university, was to praise the pro-CCP students for their actions as "self-motived patriotic behaviour".

The university did nothing to stop 200 pro-CCP students, and its statement following the fracas was unsatisfactory to say the least.  It did not name the pro-CCP students as the perpetrators of the viol­ence, nor did it mention disciplinary action.  It did not even mention how violent the protests had been, despite viral videos widely available on social media.

When some of the protesters received visits from Beijing's security apparatus, the university failed to protect them, instead siding with Beijing.  Moreover, Xu is still ensconced at the school of languages and cultures.

Also well and truly ensconced on the university campus is a Confucius Institute which, according to its website, is a "gateway to Chinese language and culture".  While this might be the formal mission of the 480 institutes around the world, their informal mission is to promote a highly uncritical view of Chinese society, and they are considered part of a wider pattern of activities that ensure Beijing's determined narrative is adhered to and disseminated widely in the host countries.

Among other things, this means subjects such as the three Ts — Tibet, Taiwan and Tiananmen Square — cannot be discussed in many classrooms without fear of a backlash.

Australia has 13 Confucius Institutes as well as 54 Confucius Classrooms that claim to support language education in schools.  This means we have the third highest number of Confucius Institutes and classrooms in the world, behind the US and Britain.  This when many universities in the US — including the University of Chicago — have been closing their Confucius Institutes, and academics have told Human Rights Watch the institutes are an affront to academic freedom.

Even more disturbing is that several of our prominent universities have signed profitable agreements with Hanban, the agency under which China's education ministry oversees the institutes.

Employees at UQ, for example, have signed an agreement in which they "must accept the assessment of the (Confucius Institute) Headquarters on the teaching quality".

China is using the full force of its economic weight to interfere with academic freedom and stifle free speech on campus in the same way it is putting pressure on Australia economically to silence us on an inquiry into COVID-19.

As UQ ponders the unravelling of the basket into which it has placed all its eggs, it should review the almost laughable scope and force of its disciplinary action against Pavlou.  The chancellor and the senate must be aware that the creation of martyrs tends to put the spotlight on precisely the issues they are trying to suppress.  As Australia becomes more concerned with the sacrifice of free speech in favour of Beijing, UQ may find itself taking direction from governments closer to home.

Friday, May 08, 2020

Get Back To Where We Once Belonged

"Want to go to the footy?  Download the app." tweeted Health Minister Greg Hunt on 2 May, speaking to Australians as if they were unruly children who need to eat their veggies before they get dessert.  The dessert being a "new normal" where governments hold our freedoms to ransom until we meet the demands of unimpeachable health experts.

Australians have been told that life will not return to normal until a sufficient number of people comply with the government request to download and activate on their mobile phones a programme, known as COVIDSafe, launched earlier this month.  When a person tests positive to the virus, the data the app collects can be used to track, trace, and isolate the outbreak.  Users are required to give consent to the data collection and it is opt-in.

At a practical level Australians are being asked to believe two implausible things.  The first is that this particular app is the only solution that was available to the government and public health authorities.  As Dr Chris Berg and Kelsie Nabben at RMIT University pointed out, the app was just one contact-tracing option amongst several alternatives that involved incorporating advanced cryptography which might be a better protection for privacy than those provided in legislation.  The federal government has given itself broad latitude to use any of the information that has been collected by it through the many exemptions and permissions accumulated over the years.

The second implausibility is that the app will operate as advertised.  Government programmes are not renowned for their efficacy, especially when it concerns technology.  Just think of the mandatory data retention legislation which was essential to protect national security but was quickly expanded to be used by economic regulators and local councils.  It would be optimistic to believe that this app, rushed to release, will run without privacy issues or mission creep.

Nonetheless, reportedly five million Australians have already downloaded the app, leading to speculation that Australians put a low priority on privacy and are not too concerned about encroachments by the surveillance state.  This ignores several important "push" factors.

The app is voluntary in name only.  The paternalistic "footy" tweet by Mr Hunt is consistent with the message of the official pandemic response.  Australians have been told that the social and economic shutdown measures cannot be relaxed until they take part in an extensive technological tracing programme.

If the app were perfectly safe and protected privacy and achieved its goals that would be a remarkable technological achievement.  But it would still not justify the government using our freedoms as a bargaining chip.  Any Australian who has not been convicted of an offence should not be required to do anything ― no matter how seemingly trivial or inconsequential ― in order to do things like visit family, have a social life or worship at a church.  It is coercion, plain and simple.

Interestingly, the people responsible for regulating how this app is used are aware of the potential for coercion.  A regulation passed by Mr Hunt on 25 April includes several requirements about how the data on the app is used and collected.  It also restricts people from coercing others to use the app.  In other words, a person is not allowed to do something like withhold the provision of goods and services or employment to another person on the basis that they have not downloaded the app.  But of course the restriction on coercion doesn't apply to politicians or the chief health officers who are offering our freedoms as part of a trade-off.

Indeed, in his National Press Club address of 5 May, Treasurer Josh Frydenberg said "every Australian that wants to get back to work and every business owner that wants to open their doors again should download the COVIDSafe app."

The idea that a person would need to do anything like this to have and exercise their most basic freedoms is completely antithetical to our history and our political system;  a liberal democracy based on ancient English liberties as expressed through the common law and Magna Carta and so many others, which is precious but vulnerable.

It was inevitable that Australia's political leaders would take action and that governments would address the threat to public health presented by the virus.  This is their job and by and large they have done it well ― we praise them for many of their efforts, such as action on borders.  However, only time will tell if, as James Allan writes, it was all a massive global over-reaction.

Well-meaning and decent Australians have accepted the rules banning gatherings as well as petty restrictions, many of which were never justifiable and which went far beyond good hygiene and social distancing.

It is now well past time to start getting life back to normal.  And that means the true normal, not the New Normal where the onus is on Australians to "earn" their freedoms.

Why It's Time To Get Back To Point-Scoring

The sooner politics in Australia returns to normal the better.  A national cabinet of the Prime Minister and premiers was a good idea at the time, but it has now served its purpose and should be wound down.

The former Liberal leader John Hewson is right when he says the national cabinet has for the moment at least, suspended the "point-scoring and blame-shifting" of traditional politics.  Everyone on the national cabinet likes to pretend that, regardless of their politics, they agree with each other and are united during this national crisis.

But the essence of democratic politics is point-scoring because that's how governments are held accountable.  Point-scoring has a purpose.

At this time when governments are exercising unparalleled power over people's lives and livelihoods, Australia needs the accountability, the scrutiny, and yes the point-scoring, of traditional politics back as soon as possible.

The federal and state parliaments should be sitting, oppositions should be opposing, and the media should stop being so complaisant to politicians and public servants.  There's been remarkably little debate on things like the size and scope of the government's fiscal response, how and when the lockdown should be lifted, and even the efficacy of the telephone-tracing application.

Other than being successful political theatre, it's not clear what the supposed unity of the national cabinet has achieved.  The two premiers who have been most extreme and most unreasonable during the crisis, Gladys Berejiklian and Daniel Andrews, appear to be doing what they want anyway.

When the crisis began, around the country the response of governments was 100 per cent determined by health considerations ― as it should have been.  Now a few months later it looks suspiciously like some governments' policies are being decided according to considerations weighted 50 per cent to health and 50 per cent to politics.

Schools is where politics is most obviously being played.

There's no medical reason why schools can't reopen.  As the Queensland chief health officer acknowledged a few days ago, schools are not a high-risk environment but "If you got out to the community and say, 'this is so bad, we can't even have schools, all schools have got to be closed', you are really getting to people.  So sometimes it's more than just the science and the health, it's about messaging."

In other words children can't go to school to make a symbolic gesture.  It's a gesture that the Victorian government is keen to make as it refuses to follow the other states and reopen its schools.

Education Minister Dan Tehan was completely right when he said "The question to Daniel Andrews, sure, take a sledgehammer to defeating coronavirus, but why are you taking sledgehammer to the state education system".  But in order to maintain the façade of the false bonhomie of the national cabinet, Tehan was forced to apologise to Andrews for "overstepping the mark".

The way in which the Victorian government has been so quick to highlight and publicise every outbreak of the virus to justify its draconian lockdown law, but then refused to identify a meatworks company at the centre of the state's biggest virus outbreak, which also happened to have well-known Labor Party links, demonstrates how the Victorian government is willing to operate.

Eventually Scott Morrison will realise that Andrews and the Victorian Labor government are not his friends.  In the lead-up to last year's federal election, the Victorian government ran a taxpayer-funded campaign against the federal Coalition about hospital funding.  Outside of the constraints of a national cabinet, federal government ministers are going to be free to point out, as Victoria's state government debt triples over the next few years, that the state risks becoming what it was in the early 1990s ― the sick man of Australia.

Hewson's hope that the national cabinet could be used to pursue policy reform in the wake of the crisis is unlikely to be realised for the simple reason that the political interests of the state and federal leaders are simply too different.

It's nice to think that in a few months' time a new spirit of unity will have transformed Australian politics.  Realistically the chances of that happening are close to zero ― and politics returning to normal won't be an entirely bad thing.

Friday, May 01, 2020

Nothing Like Exposing The Twits Of Danandrewstan

As I write this, coronavirus isolation measures are being eased in almost every state and territory in Australia.  But in Victoria, Daniel Andrews is refusing to budge on his lockdown, citing "expert evidence".

And now, with a single tweet, we know exactly the kind of "expert" Andrews is listening to, and it explains a lot.

Dr Annaliese van Diemen, Victoria's Deputy Chief Medical Officer, took to Twitter on Thursday to offer a bizarre comparison of Captain Cook's voyage to the coronavirus.  "Sudden arrival of an invader from another land, decimating populations, creating terror," van Diemen wrote.  "Forces the population to make enormous sacrifices and completely change how they live in order to survive.  COVID19 or Cook 1770?"

Tellingly, both Daniel Andrews and his health minister Jenny Mikakos were quick to back van Diemen, with Mikakos firing off a tweet of her own to say that the Deputy CMO was "doing an outstanding job", and that criticism of her was "irrelevant".

Well, no, Minister ― it is highly relevant.  Van Diemen's tweet was not about some unrelated leftist curiosity.  This is a woman upon whose "expert advice" Victoria's response to the coronavirus is based.  The fact that van Diemen is capable of such a mean-spirited, historically inaccurate and irredeemably tone-deaf outburst raises serious questions about her character and judgment.

To add insult to injury, van Diemen's generous public sector salary is paid by us, by free citizens of the very country for which she has such obvious disdain.  (Predictably, in an earlier tweet, van Diemen muses about what a racist nation we are.)

Not only that, but under the regulations made under Victoria's Orwellian Public Health and Wellbeing Act, public health officers like van Diemen are acting as the executive government imposing petty restrictions on mainstream Victorians.  Van Diemen is not just an adviser -― she has the same power (perhaps more power) than a police officer or a judge.

As it happens, Van Diemen is a prolific tweeter, giving us an insight into the political motivations with which she discharges her public duty.  Her Twitter feed is a horror show -― the musings of a Big Public Health busybody from central casting.  There is no nanny state hobby horse that van Diemen has not enthusiastically leapt on ― from jacking up the price of alcohol to banning advertisements encouraging "naughty" behaviours.  For van Diemen and her ilk, public health means interfering with our private choices.

These are the people who have given Victorians the most extreme, punitive and downright illogical lockdown regime in Australia.

These are the people who decided that, for God knows what reason, jogging solo is okay, but fishing solo is not.

These are the people who decided that golf needed to be banned in Victoria, despite the fact that every other state in Australia decided that it was okay.

These are the people who have encouraged Daniel Andrews to unleash the police force on law-abiding Victorians taking their children for driving lessons or relaxing in the park.

These are the people who decided that Victoria should be the only state in Australia in which schools should remain closed, forcing Victorian parents to moonlight as teachers while struggling to hold down their jobs as it is.

These are the people who get to roll out of bed and rake in their lucrative six-figure salaries over Zoom while ordinary Victorians stand in line for hours outside Centrelink.

And these are the people who sanctimoniously respond to every legitimate concern about the decimation of our livelihoods and the trashing of our liberties with a glib and insulting refrain that people harbouring such concerns "don't care about human life".

People like Annaliese van Diemen do not appear to be earnest public servants concerned about public safety.  They are taxpayer-funded bullies, hell-bent on micro-managing the minutiae of human behaviour.  And under the pretext of the coronavirus, Daniel Andrews has given them a blank cheque.

Andrews must stop listening to the Annaliese van Diemens of the world, adopt a bit of common sense and join every single other state and territory in Australia and start easing the petty restrictions that are making Victorians miserable.

If he does not, then in two and a half years' time, he will get the electoral shellacking he deserves.  We will not forget.