How Red Tape is Compounding The Coronavirus Commerce Crisis

Red tape is exacerbating the economic fallout brought on by the coronavirus crisis by making it more difficult for businesses to adjust to changing circumstances.

While no one could foresee the outbreak of a global pandemic, politicians and bureaucrats have willingly ignored the red tape crisis for years.

Red tape increases the likelihood of economic crises, deepens these crises when they occur, and prevents a quick economic recovery.

Red tape makes the economy more susceptible to economic shocks by putting unnecessary pressure on businesses even during the good times.  Many businesses, especially small and family-owned ones, run on very slim margins which are made even slimmer by unnecessary compliance obligations.  When a crisis hits and cash flow slows, red tape diverts resources away from recovery and toward compliance.

During a crisis red tape prevents businesses from responding in the most effective way.  Rather than adapting their business model or innovating to respond to the changing needs of consumers, some businesses are left with no choice but to shut down.  This creates enormous stress for owners, with many small business owners risking their family home used as collateral for business loans, and for employees who are now out of the job.

And red tape acts as a handbrake on economic recovery by adding to the cost of starting new businesses and employing new staff.

Three recent examples demonstrate how red tape is making the current economic crisis worse.

Food truck owners in Western Australia have warned that they are likely to lose their livelihoods as their entire calendars are cancelled in order to comply with the federal government's limit on the size of gatherings.  To respond, food truck owners want the freedom to serve food in alternative settings.  Cafes and restaurants have been allowed to respond to the lock-downs announced over the weekend by providing takeaway or delivery options.  Excessive compliance obligations, however, prevent food trucks from adapting in a similar manner.

Food trucks must be registered under the WA Food Act 2008, with the council where the truck is stored, and with each council they wish to operate in.  Each of these registrations requires submitting a form (usually around five pages long), providing supporting documents such as a floor plan and evidence of the truck's registration with the council it is garaged in, and paying a fee.  These forms typically take around 10 days each to process and once approved food trucks can only be operated in specified areas of each council.

Sandra Bahbah, who owns a Perth-based food truck, explained to WAToday, "This is going to be a disaster for the industry.  A lot of [businesses] will fail because they won't be able to afford the hit".

Supermarket operators want to respond to rapidly escalating demand by restocking outside of the usual hours so that the shelves can be full for customers the following day.  But rules which prohibit supermarkets from making deliveries outside of strict timeframes prevent this stocking from occurring.  These timeframes vary from council to council, and between different supermarkets within each council.  Russell Zimmerman, executive director of the Australian Retailers Association, explained the situation to The Australian earlier this month, saying "If we could get those trucks into those retail stores at other times beyond the curfew times [typically 7am to 10pm], there is a huge opportunity to get the stocks into the shelves so that people would then realise that the stock is there".  Fortunately, some states have acted on this, but there is much more to do.

Section 487 of the Environment Protection and Biodiversity Conservation Act 1999 allows activists to engage in "lawfare" to delay and disrupt major development projects.  My recent research estimated that this has put $65 billion of investment at risk since the year 2000 by holding up projects in court for a cumulative 10,100 days.  Section 487 has placed a significant burden on the economy, but it does not improve environmental outcomes.  I have demonstrated that 94 per cent of cases brought about through it have not resulted in substantial changes to the original project proposal.

These three examples illustrate the broader cost of red tape which I have estimated to be $176 billion each year.  This cost captures of all the businesses never started, the pay rises never given, and the hours spent complying with the edicts of unelected bureaucrats rather than training new employees and running a successful business.

This red tape burden is one of the key causes of Australia's weak economic foundations.  New private sector business investment is only 10.9 per cent of GDP.  This is the lowest level since the last recession in 1990-91 and is even lower than the average rate in the turbulent times under the Whitlam government.

Low business investment is caused by excessive red tape, an inflexible labour market, and a corporate tax rate that towers above the OECD average.

No matter how quickly or slowly the coronavirus crisis passes, these structural issues must be addressed.

Governments at the local, state, and commonwealth level must cut red tape to lessen the severity of the forthcoming economic crisis, and enable a quicker recovery where businesses can open and people can get back into work.

How Localism And Community Spirit Can See Us Through The Corona Crisis

Rather than more centralisation of powers with the government and bureaucrats in Canberra, a better approach to managing coronavirus would be through localism underpinned by a shared set of values.

Coronavirus has demonstrated that totalitarian regimes fear the free dissemination of information more than perhaps anything else.  Coronavirus spread in part because the medicos and ordinary people of Wuhan were not allowed by Chinese authorities to warn their countrymen or citizens of other countries.  The world watched as the doctor that tried to sound the alarm about the virus died at the same time as journalists were expelled from the province.

Even when not accompanied by brute force, centralism creates information gluts and disempowers citizens to act.

The impulse to centralise information to prevent "misinformation" is counterproductive.  Take the social media outlets, for example.  On March 17, Facebook decided to stop the spread of "fake news" by flagging all commentary on the virus as against "community standards".  This included not just commentary on the health implications of the virus, but also commentary and analysis on potential social implications, and, the fiscal and monetary response of governments.  Similarly, Twitter users searching for articles on the virus were redirected to the World Health Organisation's guidelines.  In effect, these social media networks are censoring discussions about the flow-on issues and government responses to coronavirus.

Localism, by contrast, enables individuals as part of broader communities to spread information and act on it quickly.  This is the complete opposite to a centralised technocracy that dispenses information from the top down and quickly hides discrepancies if new information does not fit the narrative they want to tell.

Localism, however, is dependent on social cohesion, culture, and above all, values.

Localism requires social cohesion.  Unfortunately, society is fraying as high levels of migration combine with increasing social atomisation.  Australians have moved from towns to cities, from houses to apartments, and from owned to rented properties.  Fewer Australians now know their neighbours or have a stake in their community, in large part because their neighbours and community changes so often.

The lack of physical bonds has been replaced with large global networks.  And as nice as friends in other countries are, we can't ask them for a cup of sugar (or a toilet paper roll).  No wonder people feel they need to stockpile.  The scenes of people fighting in supermarkets, which the Prime Minister rightly said was "un-Australian" in a press conference Wednesday last week, suddenly make sense if people think it is one against the world.

Hopefully tough times will also bring people together.  By helping the neighbour across the corridor with some extra supplies (particularly if they are in self-isolation) maybe we can find our sense of community again.

Localism is based on a shared culture.  Everyone can be an Australian.  It is an identity based not on ethnicity but attitude.

Our culture is to overlay the best British manners, like queuing patiently, with larrikinism.  An anecdote that history podcaster Dan Carlin tells in his WWI series is the time he asked an old US military man who the toughest soldiers were, the reply was the ANZACs because they were always laughing.

Australia has survived much worse hardships through humour, grit and good sense.

The glue that holds a community together, whether that be as small as a household or as big as a nation, is values.

However easy-going we might be, we should encourage the people who live here uphold Australian values which are immortalised at the Isurava battle site on the Kokoda Track where the words "courage, endurance, mateship and sacrifice."

These values are as true today as when they were first etched.

Post coronavirus Australia has a great opportunity to flourish, but first we must cut away the twin problems of centralisation and division which have been allowed to fester.

Coronavirus Pain Must Be Shared Around

The economic and social burden of the government-imposed sanctions to manage the health crisis must be shared equally with the public sector, which so far has remained shielded from the fallout while thousands of small businesses, sole traders and tradies go to the wall.

Seven modest measures to cut inefficient and wasteful government spending worth $30bn could be redirected to help fund the commonwealth government economic recovery packages, which assuming an annual salary of $80,000 could save 375,000 jobs.

Inefficient and wasteful spending is any dollar the commonwealth government is spending that does not meet the objectives set out by Scott Morrison of keeping Australians in a job and businesses operating.

Public servants on average have higher wages and higher superannuation contributions than private sector workers in Australia.  This is unacceptable in good times but unconscionable in the middle of economic and social Armageddon.

According to the Australian Bureau of Statistics, average weekly private sector earnings are 20 per cent lower than in the public sector, implying a $4.4bn annual commonwealth public service wage premium (20 per cent of the total commonwealth public sector wage bill of $22.12bn).

Commonwealth public servants also receive at least 15.4 per cent superannuation, compared with 9.5 per cent for private sector workers, implying a $1.3bn annual commonwealth public service superannuation premium.

The combined premium is $5.7bn, which (at an annual salary of $80,000) would be equivalent to 71,250 jobs.

Scandalously, according to the Australian Public Service Commissioner's 2018 Remuneration Report, one executive level 2 employee — which is the equivalent to a middle manager who might manage five staff — received $934,612 in 2018.  This included an eye-watering "retention bonus" of $91,196, which is higher than Australia's median salary.

No one in the public service should be receiving a productivity or retention bonus until the crisis is over and the unemployment rate drops below 5 per cent.

According to the APSC's report, the average "benefit" component — sign-on, productivity, retention and performance bonuses — of public sector salaries is 15 per cent.  Removing this and keeping the remaining 85 per cent base salary would net $3.3bn, or 41,250 jobs.

The Clean Energy Finance Corporation oversees $10bn of investment in clean power that has done little other than give Australia the fourth highest electricity prices in the world.  This is the equivalent 125,000 jobs.

The government provided a one-off grant of $444m to the Great Barrier Reef Authority in 2018 when the authority had only six full-time members.  This grant should be recalled, to the value of 5500 jobs.

The ABC's property portfolios in Brisbane, Sydney, and Melbourne are worth about $522m.  Having the public broadcaster lease premises while selling these would help save more than 6000 jobs.

Selling the National Broadband Network could retrieve just less than $10bn, according to the Parliamentary Budget Office, the equivalent to a further 125,000 jobs.

These are more than just numbers.  These are lives and livelihoods.

Every effort must be made to keep Australians in their jobs.  A job and a life are more valuable than a windmill or a solar panel, or the ability for a retired public service employee to play golf three times a week instead of twice.

The longer someone is unemployed, the harder it is to get back into work.

Maintaining the relationship between workers and their employers will play the most important role in the nation's recovery.

Yes, many will rely on unemployment benefits.  But more than a few of those who now enter the queues outside Centrelink will never work again.  The bureaucrats and experts who are re-engineering our society and economy but who themselves might never stand in an unemployment line seem less than fully aware of this stark fact.

The financial costs of unemployment are obvious.  But the social, cultural and psychological costs are substantial and, in many cases, permanent.

A job is more than a pay cheque;  it is source of meaning, dignity and self-sufficiency.  People who do not work are often unable to afford their own home, involve themselves in their communities or build a family.  The impacts of joblessness can be felt for generations, as the children of the unemployed fall behind at school and must endure the domestic pressures associated with that loss of income.  Some might even come to the conclusion that they have little to live for and nothing to offer the world.

Equality of sacrifice is required to get Australia through this unprecedented challenge.  We must all dig in.

In This Peril, Remember Australia's Success Secret

Far too many people have spent their leisure time watching post-apocalyptic television shows.  At the first sign of trouble they all immediately went shopping.  I always imagined that having a stock of ammunition and Krugerrands would be essential for the end of days.  But no.  Toilet paper.

Without wanting to downplay the seriousness of the medical crisis facing the world it is important to talk about the broader implications of the crisis.  A lot of people are using the opportunity to peddle their pet hobby horses.

No.  This is not the end of globalisation.  Nor should it be.  Some are making mischief by pointing to the medical epicentre being in China.  Irrespective of what one may think of the Chinese government, there is no justification for racist outbursts against the Chinese people.  Oppressive government is a human rights tragedy and the Chinese people are victims too.

The medical crisis does not demonstrate that free trade, open capital accounts and liberal immigration policies are a mistake.  People taking to social media to suggest that closed economies could have better protected themselves are plain wrong.  The fact of the matter is that toilet paper is manufactured in Australia.  I have yet to see a shortage of imported manufactured goods.

The arguments for free trade remain as strong today as they did last year.  The notion of comparative advantage is just as true today as it was in the 19th century.  Australia exports agricultural goods, minerals and services to the rest of the world in return for manufactured goods.  Think of our education exports ― we charge foreigners top dollar to sit in classes that we would be offering to Australian kids anyway.  We sell coal and iron ore that we could never use ourselves to foreigners ― again charging top dollar.

In return we enjoy one of the highest living standards in the world.  Ever-increasing leisure time with varied entertainment.  Trade has made us rich.  Those riches allow us to spend more money of our own health and well-being.  Yes the COVID-19 virus targets the elderly and immuno-compromised.  Large numbers of such people are sustained by our wealth.  Poorer societies tend to have fewer such individuals.

Arguments that the crisis demonstrates that "we have become too reliant on China" are just silly.  Any trading entity is reliant upon having paying customers.  This is a criticism that has especially been levelled at universities.  Usually by the same people who otherwise complain that universities are too reliant on government and should be more market orientated and business-like.  Intellectual consistency is often in short supply.  Having paying customers is always a good thing.

Hand in hand with anti-globalisation arguments is a call for greater government intervention in the economy and across society.  The "strong-man takes charge" theory of government has been a poor investment throughout human history.  Yes, the Australian government was slow to respond to the emerging crisis.  This is a feature of liberal democracy, not a bug.

Ironically, once government started seriously responding, panic levels increased.  People seem to think that government has better information and greater knowledge and understanding than everyone else does.  Sometimes, but not normally in an open democratic society.  Scott Morrison telling everyone to stop hoarding was good advice.  Supermarket chiefs telling us for days before that was good advice too.

If this isn't a story about free trade being risky, what does the crisis tell us?  Seems to me that there is a profound trust problem in our society.  Many people do not trust that the free market is resilient enough to provide for their needs in a time of crisis.  People also do not trust politicians and other leaders in civil society when they urge calm.  It is something of a paradox that many of those same people want "strong government", while not trusting the government they already have.

There is a fragility that underpins our prosperity.  Maybe because elites have spent the past 10 years or so bagging the business sector.  Non-stop criticism of business as being monopolists, profiteers, crooks, tax-evaders and the like have all paid off.  We have become seduced by prosperity.  However many years of GDP growth have come to mean that there is no level of red tape, or green tape, or taxation that the economy cannot bear.

So this time lets be smarter than what we were after the GFC.  This is not an economic crisis per se, but let's use the opportunity to be thankful that we are very wealthy, and reflect on why we are wealthy.  More importantly, let's stay wealthy.

How The Coronavirus Response Shows We Have Lost Our Fundamental Values

Australia's response to the coronavirus threat reveals that we have lost our fundamental values.  While our nation is faced with what is arguably the most significant peacetime threat since the great depression, it is worth reflecting on how we came together to overcome that tremendous obstacle.

As supermarkets witness brawls over toiletries, the Morrison government has unveiled a $189 billion stimulus package in an effort to keep our ailing economy ticking over.  The government has also taken a stand to discourage panic buying and ensure that enough supplies are left on the shelves for the most vulnerable members of our community.

That such advice is even necessary is an indictment on our current lack of social cohesion.  Hoarding demonstrates a lack of trust, not only in supply chains, but in your fellow Australians.  Thanks in part to the transformative power of globalisation and various demand-side manipulations of what capitalism once was, we no longer see ourselves of members of a community with reciprocal obligations, but merely as atomised consumers hell-bent on acquiring goods beyond their immediate utility. 

This stands in stark contrast to the spirit of self-sacrifice with which we met head-on the great depression.  Australia entered the stock market crash of 1929 in a position of special risk.  Our economy was reliant on loans from British banks, our workplace laws were rigid and job-destroying, and we relied on agricultural exports which were subject to frail international markets. 

In desperation, radical politicians like Jack Lang called for the country to repudiate our debts and prioritise our own immediate interests above all else.  Instead, the middle class insisted that repaying debts was a matter of personal pride and put their own savings into a campaign to convert a government loan and salvage our credit rating.  In the conservative populism that characterised the "All for Australia Leagues" economic considerations were largely secondary, what mattered was the moral imperative of Australia maintaining its dignity.

Nevertheless, the economic ramifications would be huge.  The mild-mannered former-Tasmanian Premier Joseph Lyons quit the Labor Party for even toying with the idea of "credit creation".  Embodying the national mood, he would lead the United Australia Party to a decisive election victory in 1931 and follow through with a policy of cutting spending and prioritising paying down our bills.

The result was that despite our acute vulnerability Australia recovered from the great depression faster than the United States with F.D.R.'s "New Deal".  Financial confidence was gradually restored because the people had upheld the sanctity of contracts and that a moral understanding of obligation would underpin every transaction.

Ninety years later, Australia enters this newest crisis in an equivalent position of special risk.  We are still reliant on international markets like that for education, our industrial relations system is still an inefficient mess, and all of this is compounded by electricity prices that have devastated manufacturing with all the ferocity of a wall street crash.  Government debt is perhaps not as bad as it could have been, but artificially low interest rates have destroyed the incentive to save and seen individuals max out their credit.

Rather than the people bailing out a government loan, we have the government trying to bail out the people through cash handouts.  The rationale is that personal responsibility or pride matter less than consumer confidence, but it is difficult to have long term confidence in a system that deliberately eschews the idea of being held accountable for an obligation you have entered into.

Now is the time to take stock and consider what we can do to rebuild ties of community.  This last summer we saw the tragedy of the bushfires politicised and exploited in a manner that would have mortified the ghosts of Australians past.  This is because they upheld old-fashioned concepts like shame, itself an expression of personal responsibility.

The solution is not to repudiate capitalism or even foreign trade, both of which are fundamental to the prosperity that has long defined the lucky country.  But what we need to understand is that these things only work when they operate in a moral framework where people are held accountable for their actions.

It is this accountability which makes community possible, because everyone knows that the rest will uphold their end of the bargain.

Listen To The Experts And Elites, But Remember They've Got Form

The Prime Minister's call for Australians to heed the advice of his government's experts may fall on deaf ears because the experts and elites have let this country down so many times before,

In his press conference last Wednesday, Scott Morrison said "if you hear it from me, if you hear it from a Premier, if you hear it from [Chief Medical Officer] Dr [Brendan] Murphy, if you hear it from those official sources and websites, that's the information you should follow."  This is likely wise advice in the current health panic.  But Australians may instead reflect on the many times the government experts and elites have been flat out wrong or misleading.

In April 2019, the Treasurer Josh Frydenberg said the country was "back in the black", meaning the Budget would be brought back into surplus for the first time in a decade.  Except a surplus was never delivered, and now never will be by this Government.

In May 2012, then Treasurer Wayne Swan said that the Labor government had "delivered" a Budget surplus.  But by December the surplus was abandoned, and an expected $2.5 billion surplus became an $18.8 billion deficit.

In August 2010, five days before the national election, then prime minister Julia Gillard said there would be "no carbon tax under the government I lead".  But then proceeded to implement a carbon tax after Labor secured minority-government following the election.

We were told as recently as 2013 by the then Labor government that the National Broadband Network would cost $37.4 billion.  But that cost has now ballooned out to $90 billion-plus ― for a service that is inferior to that which many Australians previously enjoyed.

Our government told us in February 2019 that the new submarine program would "protect Australia's security and prosperity".  Instead, the program will cost at least $50 billion and won't deliver one single operational submarine until at least 2036.

We were told the new green jobs would replace the old manufacturing jobs.  Instead, we have lost close to 100,000 jobs in the energy-intensive manufacturing alone in the past two decades, and the best estimate from the left-leaning The Australia Institute is that we might see just 60,000 green jobs in a decade's time.

Morrison told us that Angus Taylor would be the "Minister for getting Electricity Prices Down".  But Australia remains in the Paris Climate Agreement and Australia has the fourth highest electricity prices in the developed world.

We were told that superannuation was needed to provide for a sustainable income retirement system.  But instead, at least 9.5 per cent of workers' wages are confiscated by the government and passed onto financiers who charge a cumulative total of $35 billion in fees every year.

We were told that mass migration would be good for our economy.  Instead, GDP per capita grew by just 0.7 per cent over the past year, which is about one-third over the overall economic growth rate, and wages growth in the private sector are stagnant.

On top of these economic and financial failures, Australians are today more divided than ever.

The most significant moment in the Prime Minister's press conference was when he said "stop it!" to people who were hoarding supplies.  The Prime Minister went on to say that "this is not who we are as a people".  Except, perhaps it is.

After spending two decades of thinking of new ways to divide this country, such as through identity politics, the elites now seem surprised that our social fabric is weak and fragile.

The most obvious manifestation of this is the unwillingness of some to get to the back of the queue and wait their turn ― which is one of the most important practical expressions of the egalitarian ethos of this country.  It is little wonder why this egalitarian spirit has been crushed when one of the biggest ideas of the political class is to permanently divide Australians by race through an Indigenous-only body embedded in the constitution.

Our collective panic, social fragmentation and weak and vulnerable economy is laid at the feet of the elites and the courtier class that surrounds them.

It will not be the public servants, the bureaucrats, the university administrators, and those employed in quasi-government institutions like the Australian Human Rights Commission who will suffer.  Instead, many will emerge wealthier and more powerful than ever before as new laws create new powers to be conferred upon the experts.

It will be the small business owners, the labourers, the front-line staff, the families with a mortgage, small-land owning farmers, and the self-funded retirees who will suffer first and suffer most.

In the United States, the global financial crisis and the government's response created the Tea Party revolt which ultimately gave the world President Trump.

The first shot was fired when the unknown David Brat defeated Eric Cantor who was the Republican House Majority Leader in the Republican Primary in 2014.  No one in the political establishment saw it coming.

Whether the economic fallout from the coronavirus will create the same febrility in Australia is a question that cannot yet be answered.

But the constantly wrong, and, at worst, misleading predictions by the elites and the experts has created a culture of mistrust that will take longer to fix than the economy.

Virus Crisis Signals End Of The Road For The “Lollipop Economy”

However this crisis ends, the era of Australia's "lollipop economy" is over.  Not in our lifetime will a worker ever again be paid $180,000 a year to stand and hold a traffic sign at a construction site.  (Which is the amount traffic controllers can earn under the Queensland government's minimum labour requirements on state-funded infrastructure projects.)

If there's one thing that sums up what's happened to the Australian economy after 29 years without a recession, it's the symbolism of someone holding a Stop/Go sign being paid twice as much as a school teacher.

It's uncertain how Australia's highly regulated, highly indebted, high cost and low productivity economy will withstand this global pandemic.

The potential consequences of what's happening are enormous.  Some commentators are greeting the pandemic as the opportunity for the public to begin "trusting the experts" again.  Certainly, that's one direction the crisis could take.  The exact opposite reaction is also possible, and community trust in public institutions and the authority of government could be eroded even further.

There's the very real possibility that the public might realise that many of the things the politicians have spent the last decade talking about are in fact utterly irrelevant.  Climate change being the most obvious example.

Similarly, the public might come to the not unreasonable conclusion that much of what the government now does, and what the government requires regulators to do, has done practically nothing to improve the productive capacity of the country.  The product of nearly three decades of uninterrupted economic growth is that red tape is now Australia's largest industry.

The almost-guaranteed recession the country is about to suffer will make a few other things crystal clear.  It will reveal what everyone has always known about our industrial relations system, namely that its primary purpose is to increase the wages and conditions of those in work.  Australia's industrial relations system, which includes us having literally the world's highest minimum wage, does nothing to encourage employment.

Something else a recession will uncover is that Australia's compulsory superannuation system is a fraud.

There's no justification for compulsory superannuation, and that's especially the case now.  If one partner in a couple with children and a mortgage lose their job, the other partner who's lucky enough to still be in work needs the 9.5% of their income that the government confiscates immediately, not when they retire in 30 or 40 years.

The superannuation industry is right to be concerned about proposals for the government to allow early access to their superannuation balances for people who've become unemployed because that will be the beginning of the end for compulsory superannuation ― as it should be.

Even if compulsory superannuation is not abolished immediately, there is now no way any government will increase the compulsory contribution rate.

This crisis has already revealed Australia's frayed and fraying social bonds.  When the Prime Minister appealed to people to stop hoarding food and toiletries he said "We're all in this together".  He's right.

The problem is though that since the 1970s with the invention of the concept of multiculturalism and with the rise of "identity politics" more recently, the notion that Australia is a single community with every citizen being in solidarity with every other citizen, has been undermined and attacked at every opportunity.

No government now talks about how all Australians are equal and the same.  Instead, all of the emphasis in the public discussion is on how diverse and how different we all are ― and how our political and legal systems should accommodate our differences of background, gender, race, and so on.

We're taught Australia is a nation of tribes ― and such thinking leads to selfishness, not selflessness.

Up until a few weeks ago some people had assumed that as Australia's international competitiveness continued to fall the country would spend the coming decades slowly sinking into perpetual decline.  The nation's condition would never be quite bad enough to be recognised as a crisis, and so the public and the politicians they elect would never actually be sufficiently motivated to do something about it.

Well, recent events have proved that particular prediction for the trajectory of the country's fortunes spectacularly wrong.

The nation is now facing an economic, and potentially a social, "banana republic" situation ― times 10.

Quantitative Easing: A Desperate Move With No Clear End Game

The Reserve Bank of Australia's decision to engage in quantitative easing is a desperate move with no clear end game.

While QE has been precipitated by the public health response to coronavirus, the radical nature of the response is a result of a weakening economy on the back of more than a decade of failed monetary policy.

After cutting the cash rate from 0.75 per cent to 0.5 per cent earlier this month, last week the RBA made a rare unscheduled announcement to further the cut to 0.25 per cent and begin QE.  The QE measure will involve the RBA buying 3-year Government bonds in a bid to control longer-term interest rates and inject more money into the economy.  The RBA has committed to holding these measures in place until progress is made towards full-employment and achieving the inflation target of between two and three per cent.  In addition, the RBA will set up a $90 billion lending facility to incentivise bank lending to small and medium-sized business.

The inevitability of QE was apparent long before the current coronavirus response.  RBA Governor Philip Lowe clearly flagged a likely round of QE last year saying, "QE becomes an option to be considered at a cash rate of 0.25 per cent."  This was always only a matter of time.  The RBA has consistently been cutting the cash rate since November 2011, with a rapid acceleration toward 0.25 per cent beginning in June last year.

The RBA's decade long experiment with record low interest rate policy has been a failure that has resulted in an economy that is dependent on an increasing supply of easy money.

Despite appearances of economic strength and a host of rosy wage growth forecasts, the RBA has been unable to return rates to normal.

This predicament has been faced by central banks around the world over the last decade.  The US Federal Reserve for example, has repeatedly indicated an intention to raise interest rates, only to reconsider when the stock market dropped in response.

With no easy way out, the RBA has doubled down on a commitment to easy monetary policy that has produced damaging results.  Asset prices have been inflated at the expense of those outside of the housing and stock markets, and interest income has been slashed at the expense of savers who are forced into greater risk exposure in search of a decent return.  Further harm to savers will continue to occur through the erosion of the real value of savings through higher price inflation.

In addition, extended low interest rates have driven Australia's debt bubble by encouraging higher levels of both public and private debt making Australia extremely susceptible to economic shocks.  Australia's household debt is 120 per cent of GDP, the second highest rate in the OECD.

The danger of failing to normalise interest rates is now being faced by the RBA.  The longer the RBA maintained record low interest rates the more they increased the likelihood of having no room to move in the event of an economic crisis.  The prevailing 0.75 per cent rate last month left the RBA with nothing but unconventional options to continue their monetary expansion.

In a speech last Thursday Philip Lowe referred to the RBA's interventions as "building [a] bridge to the time when the recovery takes place".  But resorting to radical policies such as QE is a easy short term response that lacks a sustainable long term vision.  There is no guarantee that the RBA will be able to maintain control of Australian financial markets.  Should markets lose confidence in the Australian economy, the Australian dollar will continue to crumble and the cost of debt will rise despite monetary intervention.

The wisdom of doubling down with a strategy with no end game must be questioned.  If the RBA could not normalise monetary policy over the last ten years of economic expansion, it is unclear what economic circumstances will be required to do so in the future.

The unfortunate reality is that Australia is likely to experience a painful recession.  The solution cannot be to continually blow more air into an unsustainable bubble.  The present circumstances call for bold action in the long term interest of Australia.

In the field of monetary policy, this means reversing the monetary expansion that causes harmful economic distortions, limits sustainable growth, and ultimately leads to a dead end.

A Simple Stimulus Step That Won't Cost A Cent: Stop Green Lawfare

Over $65 billion of investment, mostly in regional Australia, has been put at risk by a small group of environmental and inner-city activists who have exploited a special legal provision to engage in frivolous and vexatious legal activism without delivering a discernible environmental benefit.

Research recently released found that green groups such as the Australian Conservation Foundation and the Wilderness Society have used a legal provision in Commonwealth environmental law to hold up major projects in court for a cumulative total of 10,100 days since the year 2000.

Section 487 of the Environment Protection and Biodiversity Conservation Act specifically empowers green groups to challenge projects that have been approved by the federal environment minister.

With Australia facing the economic impact of coronavirus, it is now more important than ever to remove barriers to investment.

Since 2000 there have been 28 projects targeted through this provision, including coal mines, dams, vegetation management, and public infrastructure.  Prominent projects include the original $16.5 billion Adani coal mine, a $2.3 billion pulp mill in Tasmania, and a $767 million coal mine at Maules Creek in New South Wales.

Despite the costly delays, the vast majority of these cases have not led to environmental improvements.  According to my research, only three out of 51 cases since 2000 ― or six per cent ― have resulted in significant changes to environmental approvals.

The success of legal challenges is not the primary concern of green groups.  Their aim, as outlined in the 2011 Greenpeace document Stopping the Australian Coal Export Boom is to "stop projects outright", "increase costs", and "raise investor uncertainty".  By holding up projects in court, even without winning the case, they deter investment in the resources sector with the prospect of costly delays and increased legal risk.

For investors in the resources industry, the punishment is in the process.

The pursuit of environmental ends with no consideration of costs or care for those forced to bear those costs is characteristic of the green movement.

The movement is based largely in the inner cities, far away from those Australians who their policy prescriptions hurt the most.  In the 2019 federal election, over 80 per cent of the Greens' primary vote came from non-rural electorates, and their share of the vote was twice as high in the inner city compared to regional Australia.

Mining projects have been opposed at the cost of jobs in regional Australia and to the detriment of regional communities.  Continued restrictions on logging are destroying a once vibrant forestry industry.  Farmers suffering through severe drought have been forced to sit by hopelessly as they watch an abundance of water flow by out to sea due to onerous restrictions on irrigation and red tape preventing the construction of industry saving dams.

Landowners have faced hundreds of thousands of dollars in fines for the crime of trying to save their homes from bushfire by clearing trees.  For example, a Queensland grazier was fined $1 million in 2017 for clearing a fire break on his property previously ravaged by bushfire.  Fires have raged at a ferocity enabled by an abundance of fuel that environmentalists have ensured has not been adequately managed.

And of course, the green movement has opposed coal and gas generated power that delivers affordable and reliable energy.  A jump in electricity and gas prices may not be felt as strongly by Green voters who have a median household income $14,000 higher than the general public, according to research from Roy Morgan.  But for many people it is the difference between their small business turning a profit, being able to spend money on the kids, or the ability to heat their homes in winter.

Many of these struggles are simply not felt by inner-city elites.  It is all too easy to advocate "action on climate change" and radical environmental policies when you are not the one bearing the cost.

The resources and agriculture sectors are an integral part of the Australian economy and the lifeblood of regional Australia.  They represent 20 per cent of private capital investment and 75 per cent of the value of Australia's top 25 exports.  Outside the big cities, agriculture and mining are major employers and support the services and retail sectors that are built up around them.

While all Australians want positive environmental outcomes, duplicated layers of complex regulation combined with legal activism are imposing an unnecessary burden on regional Australia for no discernible environmental gain.

Green activism, enabled and emboldened by lax legal loopholes, poses an existential threat to the resources sector, regional communities, and the Australian way of life.  Repealing Section 487 should be the first step in reining in the excesses of the green movement.

University O-Week Censors Excel Themselves

"Free speech crisis?  What crisis?"  Uttered in freaky unison, this frequen­t denial from university vice-chancellors has allowed them to resume normal programming.

That consists of VCs putting their heads in the sand rather than confronting those trying to nobble intellectual diversity on campus.  It includes VCs sending long emails about how proud they are of their diversity programs, with no sense of the irony that diversity of opinion is not part of that program.  And it means VCs devoting more energy to attracting foreign stud­ents than defending freedom of expression.

How much longer can univer­sity leaders ignore the accelerating rhythm to raids on free speech at Australian universities?  Today, the most brazen opponents of free speech within universities are those who control student unions.  Funded by other students' money, the leaders of student unions use their union muscle to control what other students hear, read and learn.  Not content with running social events, defending students' rights or holding university management to account, a small group of students have assumed a new role as campus censor.  And they imagine that if they provide a band and a BBQ, they can flex their polit­ical arm without reproach.

On Tuesday afternoon, the student association at Melbourne's Monash University, which runs Orientation Week stalls, BBQs and other events aimed at offering students "a diverse introduction to Monash", rejected an application from Generation Liberty to be part of the program's activities.

Generation Liberty is a program run for young Australians, includi­ng university students, introduc­ing them to ideas, arguments, and perspectives that they may have missed at school or university.  The program is a big hit;  its growth, especially over the past 12 months, points to a real hunger for knowledge not addressed by schools and universities.

In an email, events officer Michel­e Fredregill from the Monash­ Student Association told fellow Monash student Luca Rossi, a Generation Liberty co-ordina­tor at the university:  "We have carefully reviewed your booking request and discussed it internally.  Regretfully we must decline your booking application on the basis of our terms and conditions.  Generation Liberty's positions on issues such as climate change do not align with MSA's."

This is what happens when zealotry is threatened by facts.  There is nothing in the terms and conditions to justify denying Genera­tion Liberty's application to be part of O-Week, which kicks off on Monday.

In any case, a student union, or any other body, cannot use "Ts & Cs" to contract out of obligations under Victoria's Equal Opportunity Act 2010 not to discriminate against a person on the basis of their political beliefs or activities.

More sinister is MSA's reference to not aligning with "Generation Liberty's positions on issues such as climate change".  Generation Liberty has no "position" on climate change.  Gen Lib produces research­ based on facts:  the rest is left up to who is reading, listening or watching papers, podcasts or YouTube videos.

Rossi, 19, has hit back at this MSA censorship.  "As a student at Monash, it is insulting for your ­student association, who supposedly represents you, to basically say you can't be trusted with your own thoughts, we have to think for you."

The Monash law/arts student features in a series of Gen Lib YouTube videos launched late last year called What I Wasn't Told.

At last count, What I Wasn't Told … About Climate Change had attracted just shy of 200,000 views.  The video includes links for the curious to read the research that justifies every statement.

Rossi says had Gen Lib been given the chance to join O-Week, "we would have set up a stall, handed out some stickers and badges, and if some students want to have a chat with us, then we give them the idea of freedom.  And that's it."

What exactly are the officeholders of the student union at Monash afraid of?  That some ­inquisitive students might grab a vegan burger from the MSA BBQ, then wander over to the Gen Lib stall and pick up a free sticker ­carrying the Jordan Peterson quote "In order to be able to think, you have to risk being offensive"?

Or maybe they fear the badge carrying these words from Ricky Gervais:  "Just because you're offended doesn't mean you're right."

Another badge says:  "Make ­Orwell Fiction Again."

The only steadfast position taken by Gen Lib is a belief in open inquiry and students thinking for themselves.  Clearly this belief in intellectual diversity does not align with the MSA.

Rossi, one of 16 Gen Lib campus co-ordinators at 15 Australian universities, is frustrated by the lack of transparency, too.  "It's shady," he says, alluding to the decision by MSA president James McDonald to fob it off as an "operations issue" in answer to Rossi's request for more details as to why the student union rejected Gen Lib's application.

"It's basically as little transpar­ency as possible:  'You're not allowed­ to be here because we don't agree with your views.  Now please go away'," says Rossi.

Alas, passing the buck about incursio­ns into intellectual diversity happens at the highest levels about an issue that should be embedded in the DNA of every serious ­university.

When the student guild at the Queensland University of Technology refused Gen Lib's applic­ation to be part of Market Week last month, vice-chancellor Margaret Sheil learned about it from the media and responded by ­saying QUT was committed to "a variety of contesting viewpoints".

But when this asserted belief in contesting viewpoints has not filtere­d down to the student guild, it is clear that intellectual diversity is not embedded in QUT's culture.

The dirty little secret is that stud­ent unions are baying campus censors, too.  And it takes only a handful of students who control events such as Market Week at QUT and O-Week at Monash to undermine intellectual diversity for the rest of the student population.  My research compiled last year revealed that 59 per cent of students believe they are sometimes prevented from voicing their opinions on controversial issues by other students.

For student unions, freedom of speech is a controversial issue.

It is a stark failure of logic and leadership when VCs try to dodge responsibility by saying stud­ent unions are "independent" from university administration.  Student unions hold functions on campus, they are meant to represent other university students, and student unions are partly funded by ­compulsory student services and amenities fees paid by every stud­ent, except international ones.

Who then, if not university ­administrators, will hold these stud­ent censors to account?

It is not unreasonable for VCs, acting on behalf of all students, to require students within student unions or guilds to commit, in practice, to freedom of expression, open debate and intellectual diversity.  That starts with O-Week ­activities.

Instead, there is a failure of accounta­bility right up and down the line.  Just over a week ago, new Tasmanian Liberal senator Claire Chandler questioned professor Nick Saunders, chief commissioner of the Tertiary Education Quality and Standards Agency, the body charged with holding universities to their part of the funding deal — universities receiv­e federal funding from taxpayers in return for delivering intellec­tual inquiry on campus.  Saunders said the regulatory body has no authority to rein in censorship by student unions.

Chandler tells Inquirer:  "One of the real policy questions that has to be answered here is:  does a university's obligation to promote free speech on campus extend to student unions … given that these unions are getting funding from universities, through services and amenities fees that are compulsory?"

Of course it should.  More than that, it is time to restart the battle over compulsory fees that prop up these student censors.  Whereas the Coalition government abolished­ compulsory student unionism in 2005, the Gillard governmen­t reintroduced them in 2010 in the form of the services and amenities fee.  Ten years later, stud­ent unions are using these compulsory fees to fund their censorship­ of ideas and people on campus.

Chandler, who is passionate about universities fostering ­genuine intellectual freedom to sharpen young students' minds, says that if the model code recommended by former High Court chief justice Robert French in his review of free speech at Australian universities doesn't capture oblig­ations of student unions to free speech, then this "gap" needs to be addressed.

Fill the gap, by all means, but a code will not necessarily change a culture.

I saw a similar problem with the ABC board five years ago.  There was, and remains, a deeply embedded culture among journalists, producers and higher levels of the tax-funded media behemo­th opposed to the intellectual diversity that is explicitly requir­ed under its charter.

Internal codes which purported to commit the ABC to their legislative charter made no difference up against that culture.  Instead­, even egregious cases of bias by journalists were routinely met with management claims that editorial policies are too vague, dodging any finding of a breach of the policy.  Management would suggest the ABC board redraft the policies, a useless "make work" exercise­, to remove areas of grey.

When another glaringly obvious episode arose of bias, often from the same journalist — recidiv­ists were not hard to find — the board would receive the same response.  It's all rather grey so we can't do anything.  In other words:  go away, our ABC culture trumps a code and even a legislative charter mandating intellectual diversity.

The same scenario will unfold across Australian universities.  Even the most beautifully crafted free-speech code will count for nothing until there is meaningful cultural change.

And that will not happen until the Morrison government moves to reduce funding to universities that do not implement cultural change.

Over to Education Minister Dan Tehan to walk the talk, rememberi­ng too that academic freedom was thrown under the bus when James Cook University decided­ to sack professor Peter Ridd on a bogus code of conduct claim.  JCU has committed to spending hundreds of thousands of dollars to defend that action in courts, rather than defend intellectual ­diversity.

In the meantime, we are left to ponder the state of a higher educatio­n where codes, laws, regul­ators and the media are needed to remind VCs and student union­s about the core business of a ­university.

The Very Last Thing We Need Is Radical Reserve Bank Action

The Reserve Bank of Australia has used the coronavirus threat to accelerate its move toward radical monetary policy.  To prevent further distortions to the Australian economy the government should lower the RBA's inflation target that is driving economically harmful intervention.

Last year, RBA Governor Philip Lowe tested the waters with talk of quantitative easing and negative interest rates with the proviso, "our current thinking is that QE becomes an option to be considered at a cash rate of 0.25 per cent, but not before that."  With last week's decision to cut the cash rate to 0.5 per cent, the RBA is now just one cut away from what it has termed "unconventional monetary policy".  At the Australian Financial Review Business Summit on Wednesday, RBA Deputy Governor Guy Debelle increased expectations of QE stating, "there are scenarios in which we are certainly going to have to consider that ― absolutely."

Quantitative easing would involve the RBA buying long term government debt and other financial assets in a bid to lower long term interest rates and inject more money into the economy.  This measure will inflate asset prices, expand Australia's debt bubble, and further harm savers by lowering their interest income, forcing them into greater risk exposure and diluting the value of their savings through higher price inflation.

The inevitability of QE was clear long before the coronavirus outbreak, which was mentioned nine times in a Lowe's short seven paragraph 'Monetary Policy Decision' statement last week.  The economic shock may have brought forward the cut, but the response to the coronavirus should not be divorced from an already well established trajectory.

Despite holding interest rates at record lows for the past seven years, the RBA has only managed to meet its inflation target twice in the last 21 quarters.  If a future cash rate cut to 0.25 per cent is anything like the previous 15 consecutive cuts, it too will fail to generate inflation.  The next step, as Lowe has admitted, will be for the RBA to spend money into existence through the purchase of financial assets.

The risk of QE can be mitigated by lowering and expanding the inflation target.  All this would require is a straightforward agreement between the Treasurer and the RBA Governor to lower and widen the inflation target band, shifting it from between two and three per cent to between one and three per cent.  This would allow the RBA to refrain from further expansionary policy.

The current trajectory in monetary policy has been a failure.  The economy's current predicament comes on the back of a decade of unconventional policy.  There is nothing conventional about holding interest rates at record lows for multiple years on end in the absence of a recession.  The solution cannot be to double down.

Experiments with QE and negative interest rates by central banks around the world have failed to produce empirical support for the RBA to follow.  Moreover, the RBA lacks a proven policy track record.  Reading through the last decade of monetary policy statements will not fill anyone with confidence that the RBA has any special knowledge or skill for forecasting the effectiveness of their policies.

The first step in righting the ship is to reconsider the pursuit of an arbitrary inflation goal.  Central banks across the world have been tripping over each other trying to generate price inflation with increasingly destructive policies.  The end result has been economic stagnation and the inflation of asset markets that are addicted to easy money.

Instead of fearing deflation, downward pressure on prices should be recognised as beneficial when resulting from productivity gains.  If the amount of goods produced in the economy grows at a faster rate than the amount of money, prices will fall.  This means lower living expenses and an increase in the purchasing power of accumulated savings.

Deflation is feared because extended easy monetary policy has created an economy dependent on continual monetary expansion.  This means that low rates of inflation and the slowing of monetary expansion are often associated with pricking bubbles in the economy.  But accelerating monetary expansion to maintain asset bubbles can only make the problem worse.

It makes no sense to maintain an inflation target that if enforced would require the RBA to engage in economically harmful policy tools.  Widening and lowering the inflation target to between one and three per cent is a necessary and prudent first step to avoid undermining the Australian economy with radical monetary policy experiments.

Some Stimulating Ideas

Rather than engaging in a shortsighted and reckless cash splash, the federal government should seize the opportunity created by the economic fallout from the coronavirus to cut red tape, reduce taxes, and deliver reforms that will save the Australian economy from recession and form the basis for prosperity for decades to come.

The Morrison government is expected to announce today an economic stimulus package to offset the economic impacts of the coronavirus expected to be worth up to $20 billion.  In a similar style to the Rudd government's failed stimulus during the global financial crisis, pensioners and Newstart recipients are expected to receive one-off cash payments of around $500.  This is on top of a $2.4 billion package to deal with the health impacts of coronavirus.

It is likely the Australian economy will go backwards in the coming months and may enter a recession.  But this downturn is being primarily driven by disrupted supply chains and cashflow issues facing businesses in the wake of the coronavirus, not lower consumer spending.  A big government cash splash is not the answer.

Granted, people are staying home, large public events have been cancelled, and fewer tourists and international students are coming to Australia.

But receiving a government cheque will not mitigate the risk of going to the movies or a restaurant and potentially contracting the coronavirus.  The availability of money is not an issue, people's willingness to spend it is.

An effective response requires a focus on the supply side of the economy to keep businesses open and allow them to keep their staff employed.

A cash splash will only add to the $546 billion government debt, all of which must be repaid by our children and grandchildren.  Here are five more effective ideas.

Firstly, cut red tape.  I estimate that red tape costs the Australian economy $176 billion every year in lost economic output.  This is the equivalent to approximately 10 per cent of GDP, which makes red tape Australia's biggest industry.

Every minute and every dollar a small business owner must dedicate to filling out forms brings them a minute and a dollar closer to laying off staff or reducing their wages.  This is dangerous, as small businesses account for about half of all private sector employment.

Secondly, reduce the corporate tax rate.  At 30 per cent for businesses with an annual turnover of $50 million or more, Australia has one of the highest business tax rates in the world, one which is well above the OECD average of 23.9 per cent.

The US and the UK have significantly reduced their business tax rates in recent years, to just 21 per cent in the US and 19 per cent in the UK.

To assist Australian businesses, the corporate tax rate must be reduced to a competitive rate below 20 per cent for all companies.  This will ease cashflow pressures and enable businesses to invest in machinery and workers.  Additionally, it will attract overseas businesses and investment bringing more jobs, higher wages, and greater economic prosperity.

Thirdly, expand the Instant Asset Write-Off.  The IAWO improves cash flow and makes investments more affordable by allowing for a higher, immediate tax deduction on new capital investment.  Under the IAWO a painter buying a new van for $27,000, for example, can deduct the full cost immediately, rather than carrying the deductions over five years.  This leaves them $21,600 better-off today, allowing them to hire new workers, pay higher wages, or make other investments.

The IAWO is currently available to businesses with an annual turnover under $50 million and on investments worth up to $30,000.  By uncapping the turnover threshold and increasing the investment threshold to $1 million, the IAWO will immediately increase cash flow and facilitate new investment, creating more jobs.

Some reports suggest the government will attempt to stimulate demand, with certain groups advocating for measures targeted at particular subsets of the population.  For example, on 9th March Charmaine Crowe of the Australian Council of Social Service argued on Sky News that "the best way to (boost household expenditure) would be to increase Newstart."

If the government wants to increase demand, they should reduce taxes rather than increase spending.

This means, as a fourth measure, bringing forward the personal income tax cuts introduced in the 2019-20 Budget to take effect immediately.  The full tax cuts will mean some 94 per cent of wage-earners would face a top marginal tax rate of 30 per cent or less.  This will provide a significant boost to take-home pay, allowing Australians to keep more of their hard-earned money.  However, the full effect of the tax cuts aren't due to take effect until 2024-25.  The government should instead make them effective immediately.

Similarly, and finally, the government should consider a temporary pause in compulsory superannuation, allowing workers to receive the missing 9.5 per cent of their pay and give them the benefits of higher wages without adding to government debt.

Rather than engaging in another reckless cash splash, the government should respond to the coronavirus challenge by delivering the greatest economic reform agenda seen in a generation.  This will save the Australian economy from recession and set the nation up for decades of prosperity and success.

SBS Is Mocking "Your Right to Know"

In October last year, the SBS joined the Your Right to Know Coalition, a push from the major media outlets to put pressure on parliament to improve freedom of information and other laws so that Australians can know more about what their government is doing.

And how does the nation's second-largest public broadcaster measure on transparency?  Based on a recent freedom of information request submitted to SBS it seems that the Right to Know is a right designed only for those Australians who are employed in Big Journalism, rather than the millions of Australians who are concerned with what the public sector do with their money.

This particular instance of SBS opacity dates back to October of 2013 when the SBS published on its website an article with the headline "Fires not due to climate change:  expert".

The article was a news report written by the AAP, a news aggregation service, and featured the considered opinion of retired Monash University researcher David Packham, who said linking bushfires to climate change is "absolute nonsense" and reducing fuel loads in the Australian bush is urgently needed to reduce the intensity of bushfires.

The article resurfaced in November 2019 and was shared around social media in the wake of opportunistic alarmism from the green lobby that the bushfires at the time were the result of climate change.  But on November 12, it was inexplicably taken down from the SBS website.

A day or two later, the SBS put the article back online but featured a new preamble.  The substance of the new paragraphs was to confirm that Packham still held the same views then as he did in 2013.  In response, Packham said "The most important (factor) is the dryness of the fuel, which comes from hot dry weather … the theory is as solid as the universal theory of gravitation."

One could be mistaken for thinking that the SBS felt that the link between climate change and bushfires was now unimpeachable and that this update would discredit Packham.

In response to these bizarre actions by SBS, I submitted a Freedom of Information request for "Copies of correspondence or emails or documents created, sent or received by SBS staff in relation to the deletion of the October 22, 2013 article titled 'Fires not due to climate change:  expert' between 9 November 2019 and 13 November 2019."

On December 12, 2019, SBS then sent me a letter of refusal, stating that the SBS is exempt from the operation of the Freedom of Information Act in relation to documents that are created "in relation to its program material and its datacasting content."

In other words, the SBS was arguing that its website was a "program" and that because of this, any correspondence about a decision to edit or remove an article from its website was program material and not available under freedom of information laws.

On January 8 I challenged this position in a request for an internal review of the decision.  The reason for the rejection falls at the very first hurdle.  An article on a website is not a program in the ordinary or legal sense of the word.

A definition given by the Oxford Dictionary of English defines 'programme' or 'program' in the broadcasting context as 'a presentation or item on television or radio, especially one broadcast regularly between stated times.'

SBS has rejected this argument and reasserted that an article on the SBS's website is a program.  It argued that the word "program" should be read in a wider context.  Since the SBS charter includes as a principal function digital media services, the argument goes, it must therefore follow that digital media services are a program.

As we noted, this is inconsistent with the express definition in the Special Broadcasting Service Act — the main act of parliament regulating the SBS — which restricts the meaning of program to mean something broadcast on television or the radio.  This definition is also implied in the Broadcasting Services Act.

Despite their insistence, the SBS has not been given the power to decide which of its activities are programs and which are not.  The public broadcasters are bound by the legislation which establishes them.

Even in the unlikely event that a web news article could be defined as a program, it does not then lead to the conclusion that any document about it is exempt from FOI laws.  The program material exemption is itself limited to a certain range of documents.  At its broadest, it would capture documents which are "created or acquired for the purposes of such as those that are created to be used in a program or for the purpose of creating the program, whether or not incorporated into the complete program."

Nothing in the existing definition of program material would capture correspondence about why an AAP authored article would be taken down for special editing over six years after its first publication.

The SBS is a commercialised entity operating in the media marketplace.  As such an exemption for program material may be explained by the need to protect material which the SBS as a statutory corporation might have a proprietary interest in.

In other words, the legislation will not force the SBS to release its intellectual property to its competitors and other third parties, and the legislation provides for this by way of exemption from FOI laws.

It is not intended as a carte blanche exemption from releasing any document to taxpayers who, as unwilling donors of the SBS, have a special interest in overseeing how government entities such as the SBS are operating.

Which makes the SBS's support of the Your Right to Know campaign entirely hypocritical.  When the SBS signed on to the campaign, it was arguing for "A suite of changes to FOI law to reduce and restrict the significant delays, obstacles, cost and exemptions that allow government agencies to prevent disclosure."

These are the very tools the SBS now employ to avoid oversight.  It advocates for the very kind of transparency and accountability in areas of government that it will not accept for itself.

I have appealed the SBS's refusal decision to the Information Commissioner to ensure that 'Your Right to Know' is more than just 'Their Right to Know'.

Left's Control Of Higher Courts Under Threat

The progressive reaction to calls for capital-C legal conservatives to be appointed to the High Court — that it would politicise the judiciary — is an insincere attempt to retain its power over the legal establishment.

The High Court's decision in February that indigenous Australians should be treated differently in the Constitution because of their racial identity was the most radical judgement in Australian history.  It destroyed the idea that Australians have about multiculturalism that there was one law in Australia and that everyone was subject to the law in the same way.

The case concerned attempts by the commonwealth government to detain and deport two individuals who were not Australian citizens and who had failed their migration character tests as a result of being convicted criminals.  The individuals descended from indigenous Australians but were born overseas.

The individuals argued — and a majority on the High Court agreed — that a person with these characteristics could not be subject to the commonwealth's constitutional power to make laws with respect to aliens.  The court developed a new category of person — non-alien, non-citizen — based on the idea that people of indigenous Australian descent forever "belonged" to the continent in a way that could not apply to others.

The decision distorted the common law to import a new and incomprehensible legal principle that has fundamentally reshaped the relationship Australians have with each other and with the Australian Constitution.

This has emboldened calls for a change in how judicial appointments are made and the kinds of judges who are appointed to Australian courts.

Predictably, this has been met with accusations that conservatives are attempting to make "blatantly political appointments", as the Judicial Conference of Australia's president, Judith Kelly, remarked in The Australian last month.

In this reading the High Court's decision — which until this case was an inconceivable and unimaginable outcome — was a merit-based resolution and the rejecting of this new orthodoxy is inappropriately partisan.

What is happening in Australia is a reflection of something similar in the US.  Chuck Schumer, the leader of the Democratic Party in the US Senate, on Wednesday threatened Neil Gorsuch and Brett Kavanaugh, the two judges nominated to the Supreme Court by President Donald Trump.

"I want to tell you, Gorsuch, I want to tell you, Kavanaugh — you have released the whirlwind, and you will pay the price.  You won't know what hit you if you go forward with these awful decisions," Schumer told the cheering crowd in response to a hearing into a state law restricting abortion.

Schumer's subsequent apology was likely influenced by the Supreme Court Chief Justice John Roberts's rare rebuke calling the comments "not only inappropriate" but "dangerous".

The instinct to respond in this way is a manifestation of a shared problem.  The cultural left has (in Australia) or had (in the US) an uncontested stranglehold on the legal establishment, and is eager to retain that control.

The allegation that conservatives are seeking a political takeover of the courts is wrong.  The call from legal conservatives for judges with a conservative disposition to be appointed is in response to the century-long politicisation of the courts by progressive judges.  Over this time the Australian Constitution has routinely been rewritten to give untrammelled lawmaking power to the federal government in distant Canberra, dismantle the federal structure, and now to divide Australians on the basis of their racial identity.

The question of what describes a legal conservative includes rejecting the judicial activism that has been a staple of the Australian High Court.  Judicial activism is the name of the broad philosophy of judges to import their own values into the Constitution.  This is sometimes called "living tree" constitutionalism because the constitutional structure is a growing and evolving entity that needs to be updated by the courts to align with the modern situation.

The obvious problem with this philosophy is that this is fundamentally subjective.  Under this school of thought any judge could determine which cultural evolution they would like to import into the Constitution.  In any given era the values of the court will change, meaning that over time the judgments of the High Court would be unpredictable but could nonetheless rewrite how the country is governed.

The law is what the politicians intend for it to mean, but judges in Australia have interpreted this to mean that the law is whatever a judge decides it should be.

Due to the important work of organisations such as the Federalist Society, legal conservatism is now firmly ensconced as a mainstream philosophy in the American legal establishment.  As the comments from Senator Schumer demonstrate, this has been viciously resisted as a threat to the left's institutional hold on power.  The left in Australia knows and fears the same could happen here.

Don't Bail Out Bloated Unis

Australian universities should not get a cent of any federal government bailout program or stimulus package in the wake of the coronavirus.

Over the past decade universities have privatised the profits from the fees paid by overseas students.  University vice-chancellors in this country enjoy building Taj Mahals to themselves and earning an average annual salary of close to $1 million.

It's true universities are now large operations.  The University of Sydney has a $2.8 billion budget and its vice-chancellor is paid $1.5 million a year.  But it's not that hard to run a business in an industry that is basically a self-perpetuating oligopoly where the government does you the favour of banning price or product competition.

Australia's universities these days are like our banks.  They compete against each other on the basis of the colour of their logo and the strength of their supposed commitment to the latest progressive cause promoted on Twitter.  (But, to be fair to universities and the banks, if advertising such fripperies is basically the only thing the government allows you to do to attract customers, that's what you do.)

The University of Sydney said this week it is facing a loss to its revenue of $200 million because of the coronavirus, with 15,000 of its students unable to leave China.  According to the university, if these students missed a year of education, up to 1500 full-time jobs would be affected in NSW, in the retail, accommodation, and food services sectors.

This is a revealing argument from the university.  It demonstrates that the $17 billion Australian taxpayers pay to our universities is as much about supporting employment in fast food outlets as it is about fulfilling Cardinal John Henry Newman's vision of a university as a place that "educates the intellect to reason well in all matters, to reach outwards towards truth, and grasp it".

The truth is that public universities in this country are today not places of higher learning ― they're certificate factories.

Certainly there are pockets of creativity and scholarship and groundbreaking research in Australian universities, but they are harder and harder to find.  The reasons for this are many and varied, ranging from the Labor Party's Whitlamite obsession to bestow a university qualification on as many people as possible regardless of its quality, to the Liberals' complete lack of comprehension about what has happened to universities, to the sector's preference for growth at any expense.

As Peter Hartcher has reported in The Sydney Morning Herald, it was Victorian Liberal senator James Paterson who summed up the universities' situation in the Coalition party room last week.

In a discussion about federal government financial assistance for those affected by the coronavirus, Paterson said:  "With the ongoing China travel ban, I'm very sympathetic about the impact of tourism and farmers, but I'm less so with the universities.  Because they have been warned for years that they are over-reliant on the Chinese market, and for years they've reassured us that it was all fine, and that if anything they'd be able to withstand it.  They rode the cycle up, now they can ride the cycle down."

The argument is often made, usually by the universities themselves, that they've been forced to rely on overseas student income to make up for Coalition funding cuts.  This is demonstrably wrong.

As shown by a research paper from the Parliamentary Library, Overseas students:  immigration policy changes 1997-2015, the big increase in overseas student numbers began just as the Rudd government was increasing funding to the tertiary sector.  In 2005-06 the number of overseas student visas was 191,000, in 2006-07 it was 231,000, in 2007-08 it was 279,000, and in 2008-09 it was 320,000.

As travel bans on students hit university enrolments, the tertiary sector should not be allowed to force taxpayers to socialise their losses.

Universities can't have it both ways.  They can't on the one hand declare their autonomy and complain when ministers involve themselves in the allocation of research funding, for example, and then on the other hand, at the first hint of trouble go with their begging bowl to the very same minister, asking for a taxpayer-funded handout.

To The Victim, Belong The Spoils Of (This) Law

The government's proposed religious discrimination bill puts the shoe on the other foot, and now the activists who championed every other discrimination law are bemoaning the "divisiveness" of this one.

It is divisive, but so is all discrimination law.

The public consultation period for the second draft of the religious discrimination bill, which prohibits discrimination based on someone's beliefs (or lack thereof), has closed.

Last week the cacophony of complaints about this bill reached fever pitch.

People from former High Court judge Michael Kirby to Olympic swimmer Ian Thorpe have given their two cents' worth of outrage.

ACT Chief Minister Andrew Barr complained that it threatened human rights.  He goes on to ask why you would enshrine in legislation a particular privilege for a group of people to be able to espouse a view that will offend many, and to grant that legal privilege?

He is not wrong that this bill is a threat, but he is incorrect if he thinks basic liberties, such as the freedom to espouse views, be they religious or otherwise, are indeed a privilege.

This law, at least in part, originated because state and federal anti-discrimination laws systemically infringe freedom of speech (and particularly expression of religious ideas).

Instead of abolishing laws that violate basic freedoms, the government has decided that it is going to fix the problem of illiberal, convoluted anti-discrimination laws by enacting yet another illiberal, convoluted anti-discrimination law.

Doing the same thing over and again but expecting a different result was Albert Einstein's definition of insanity.  History will repeat itself and, just like the notorious section 18C of the Racial Discrimination Act, it soon will become a bureaucratic goliath that no government can or wants to control.

Discrimination laws are inherently discriminatory.  Discrimination laws operate by granting a right of action to one group against another, meanwhile carving out exemptions for some but not others.

Moreover, it fundamentally misunderstands the nature of individual rights.  It reverses the presumption that all Australians are entitled to be equally free, making some of us more free than others.  The Coalition may think it is giving religious freedom in this bill but in reality it is confiscating it.

The only way to protect religious freedom is by protecting the freedom of all Australians to think, speak and associate.  Freedom of religion is simply the use of these most fundamental freedoms for a religious purpose.  If the government truly wants to protect religious freedom it should repeal the laws that prohibit expression of religious and all other ideas (regardless of their origin) in the first instance.

The activists who initially were protesting against this bill because it would victimise people on the basis of gender and sexual orientation have found a new victim group — religious people.  The newest complaint is that the religious discrimination bill indeed permits religious discrimination.  Again, they are not wrong.  However, if this bill didn't allow places where religious people could associate exclusively with members of their religion, it would not protect religious people at all.

Freedom of association is intrinsic to the exercise of religion and civil society in general.  The issue is not that this bill allows too much freedom of association but that it limits it.

The ability to create a space exclusive to the exercise of one religion is contingent on meeting the criteria set out in the bill, as follows:  a religious body does not discriminate against a person under this act by engaging, in good faith, in conduct to avoid injury to the religious susceptibilities of adherents of the same religion as the religious body.

This vague and subjective wording does not properly protect freedom of association but is a recipe for litigation.

The Noosa Temple of Satan's submission amusingly demonstrates the problem with this bill.  The Noosa temple says it is a "waste of the federal government's time", but if it is passed the temple will use it "aggressively".

This bill could inflame sectarian tensions between different religious communities and non-religious groups.  Far from creating a society of religious tolerance, it could create a society of religious lawfare and one where the most sensitive win.

Anglicare Victoria tweeted that it opposes "the #ReligiousDiscriminationBill because it allows people to use faith as a means to cause harm to others".

Anglicare is right to oppose this bill but, as with all laws of this kind, the problem is not that it permits bigotry — it weaponises it.

The Case Against Four Bin System

The Andrews Government's announced statewide move to four colour-coded rubbish bins is a waste of time, money and space.

Environment Minister Lily D'Ambrosio is conscripting every citizen to become an unpaid rubbish sorter.

Many Victorians just don't have the room to store yet another bin.

Those Victorians with small townhouses and one-car garages hardly have enough space to store their existing bins.

Adding an extra one will increase costs to ratepayers by an extra 25 per cent, which means higher rates.

If the aim of this policy is environmental, then that's an additional diesel garbage truck polluting the neighbourhood every week.

The median value of a square metre of land in Melbourne is more than $1100.  The cost of storing an extra bin will waste $253 worth of land per household, on average — even more in the inner city.

Ms D'Ambrosio said the government was making waste collection an essential service.

But with council rates soaring to record highs, all it is doing is foisting this "essential" responsibility on ratepayers.

A new Dynata poll released last week found 66 per cent of Australians think local councils should stick to roads, rates and rubbish.

Only 10 per cent disagree.  Yet apparently councils can't even do rubbish properly.

Why The Aboriginal Citizenship Ruling Is Alien To All Ideas Of Law

The utter failure of the federal Coalition, after almost seven years in government, to do anything to arrest the left-wing political activism of Australia's institutions of government and administration was on full display last week.  It's one thing (as bad as it might be) for the ABC, or the Canberra public service, or the country's taxpayer-funded universities to indulge themselves in the progressive cause of identity politics.  But it is altogether more serious when a majority of the High Court does it.

In last week's decision of Love and Thoms v the Commonwealth, four of seven High Court judges ruled that whether Australia's citizenship laws apply to a person depends on their racial background and identity.  In the case of two individuals, Daniel Love and Brendan Thoms, the majority decided that although they were not born in Australia, and were not Australian citizens, they could not be deported following their criminal convictions because as people of Indigenous descent they were not "aliens" under the terms of the constitution.

Two of the majority, Justices Geoffrey Nettle and Michelle Gordon, were appointed by the Abbott government, and a third, Justice James Edelman, was appointed by the Turnbull government.  The fourth member of the majority, Justice Virginia Bell, was appointed by the Rudd government.

If future High Court decisions endorse the majority view that the law should permanently divide Australians according to their race, Love and Thoms could prove to be the most significant and controversial case in the history of the court.

The majority decision in Love and Thoms is so deeply flawed at so many levels, and so at odds with the basic notions of the rule of law, it is difficult to know where to begin.

First, it overturns the notion of equality before the law.

Second, the majority decision means the Parliament no longer has the capacity to decide who can and can't reside in the country, because there is now a class of people beyond the realm of Commonwealth law.

Third, the reasons the majority provides for their extraordinary decision are confused and incoherent, and are grounded in politics and philosophy, not in law.  And the most confused and incoherent judgment is that of Justice James Edelman.  At the age of 46, Justice Edelman could be on the High Court for another quarter of a century.

DANGEROUS TERRITORY

According to Edelman:  "The identity of of Aboriginal people, whether citizens or non-citizens, is shaped by a fundamental spiritual and cultural sense of belonging to Australia" and "[Aboriginal people] have been inseparably tied to the land of Australia generally, and thus to the political community of Australia, with metaphysical bonds".  Once a judge starts talking about "metaphysical bonds" they've transcended the realm of the law into something else entirely.

A more fundamental problem rests with Edelman's argument that regards Love and Thoms, not as individuals, but as members of a group he describes as the "Aboriginal people".  Certainly, many individuals of Indigenous descent might regards themselves as "inseparably tied to the land of Australia" — but some might not.

To describe people as members of a group first, and as individuals second, is both dangerous and tragic.  Whether Edelman is engaging in any sort of racial and ethnic stereotyping is for him to answer, but there is certainly the question of whether he would apply the sort of profile of belief he ascribes to Indigenous Australians to any other group of people who were not Indigenous.

Using "metaphysical bonds" to determine whether a person can be deported from Australia the country is highly problematic.  There's of course any other number of "metaphysical bonds" that could connect individuals to Australia.  A great-grandfather in one of the 1200 Australian graves at the VC Corner Cemetery at Fromelles in France is just one such metaphysical bond.

The success of Australia as a multicultural society rests on a core, and up until now, widely accepted principle — namely that all Australians are equal under our political system and in the eyes of the law — regardless of whether their forebears arrived in Australia a generation past or 60,000 years ago.  Last week, either deliberately or not, the majority of the High Court began to gnaw away at that principle.

A Path Forward On Constitutional Recognition

This week's decision in the High Court to invent a new category of personhood for people on the basis of their race is a devastating blow to the movement for the constitutional recognition of indigenous Australians.

On Tuesday the High Court handed down a decision in relation to how non-citizens who identified as Aboriginal would be treated under the Constitution, and in particular if they were subject to the commonwealth's migration laws.

By a narrow majority of 4-3, the justices decided that non-citizens who were descended from and claimed membership of indigenous Australians could not fall within the scope of the commonwealth's power to make laws with regards to "aliens" under section 51 (xix) of the Australian Constitution.

This is the most radical decision in the history of the Australian High Court.  The court has effectively created a new class of person on the basis of racial identity.

It is a fundamental challenge to the idea of racial equality as well as the sovereignty of parliament to decide who can be members of our shared political community.

This extraordinary decision has significant implications for proposed constitutional recognition of indigenous Australians.

This week the High Court demonstrated that it was prepared to make out of whole cloth a race-based exception to migration laws and the commonwealth's constitutional power to decide who aliens are.

It demolishes the idea from supposed constitutional conservatives that there is a form of minimalist constitutional change that would have minimal consequences in the law and the Constitution.

Proponents of constitutional recognition — in the form of either a symbolic preamble or the establishment of an indigenous body to advise the parliament — referred to as the Voice — have been insistent that these ideas are simply about recognising the place and history of indigenous Australians and would be treated with restraint by the courts.

In light of the High Court's decision this week such an assertion is no longer credible.  Having now created a new category of people beyond the scope of Australia's migration laws, what would it be prepared to do with a preamble?  Or how would it interpret the role and functions of a Voice body?

However, there is a path forward for achieving constitutional recognition that properly recognises the equal dignity of indigenous Australians and which would not give the High Court another opportunity for unbridled activism.

Credible recognition would mean amending the Australian Constitution to remove the remaining references to race, not adding more references to race.

The first of the two references to race in the Australian Constitution is section 25, which pretends to penalise a state if its parliament restricts an entire race from voting.  The provision is now defunct and should be deleted.

The second is the race power, which gives the commonwealth parliament the ability to pass laws with respect to the people of any race for whom it is deemed necessary to make special laws.

There is no legal or moral justification for retaining the race power.  The basic needs of all Australians are not culturally contingent.  A power to legislate for specific races can never be a beneficial power because it rests on the flawed presumption that different groups need to be treated differently under the law.  The policies that promote a successful life and human flourishing are the same regardless of one's race or colour.

Few pieces of legislation rely on the race power.  The legislation regulating native title is frequently cited as being at risk of invalidation if the race power were to be removed.  This would be extremely unlikely.

Native title is the settled law of the land and has been recognised since 1992 by the High Court as existing as part of the common law.  If tested in a court, the Native Title Act would not rely solely on the races power for validation.

To retain the law, the commonwealth could rely on the external affairs power which gives the federal government the power to implement international agree­ments, such as the UN Declaration on the Rights of Indigenous Peoples.

Additionally, the commonwealth could rely on the nationhood power or ask the states to refer the power to regulate native title to the federal sphere.

A new poll conducted by Dynata found that more Australians agreed (45 per cent) than disagreed (16 per cent) with the idea that all references to race should be removed from the Australian Constitution.

Moreover, this was consistent across all age groups surveyed.

Indigenous recognition means recognising that indigenous Australians are the moral and legal equals to all other Australians.  And equal recognition of human dignity between races demands the removal of divisive reference to race in Australia's constitution.