Today’s business media coverage of the mining versus Queensland Government’s royalty hike is all one way. Here’s a quick set of links to illustrate:
- Royalty hike puts mining in a hole. The Australian
- Awkward for Swan but worse for miners. The Australian
- Small wonder the Budget is in deficit. The Australian
- Don’t villify the wealthy. AFR
- Stop plundering the boom. AFR
- Newman, coal and Nasser’s knife edge. AFR
- Nasser’s road from Ford to E-type. AFR
- Pollies get it so wrong. AFR
- The lies that blind and mining suffers. BS
I have already been up-front about my view on this. To me it is obvious that mining has not been paying it’s fair share of tax since the boom began because royalties are, by and large, volume based. At an extra 1.5% on coal sales above $150 per tonne (and higher for those above $200 per tonne) it is not going to kill the industry nor close any mines that weren’t going to close anyway because margins were already too compressed. When a government also slashes 14k jobs to pay its bills you can hardly say you’re being singled out.
But I’m also happy to admit that I could be wrong. I could be persuaded by solid figures and a thorough debate that the truth is otherwise. Judging by the above coverage, however, who is going to convince me when there is virtually no debate, very few figures, a lot of assumptions and a clear enthusiasm to rubber-stamp the corporate view?
So the question I am asking myself this morning is why is it that business media does not engage in debate about the utterances of senior business people?
The obvious conclusion to draw is that it is because of the sometimes internecine relationship that business media has with its advertisers. Everyone knows that strongly independent editorial can cost advertising dollars. But miners are not a big advertiser. In fact, until recently, they hardly advertised at all.
Is it perhaps “access journalism” that is the culprit? That is, there is a relationship between getting access to important corporate figures and providing favourable coverage? Partly, but the coverage is broader than that today so that’s not all it is. Besides there is something in the maxim “treat ’em mean to keep ’em keen” in media.
Is it a form of libertarian ideology? That is, because executives control a large stake of private capital, their words are considered intrinsically more credible that any public servant taking an opposing view? Partly.
But what is most at work here, in my view, is the simplistic culture of Australian business journslism. Ask any died-in-the-wool Australian business journalist or editor why they adopt the point-of-view that they do and they will generally answer that they are “pro-business”. The corollary is that they are also “anti-government”. But exactly what does this mean?
In theory, it is a part of the above libertarian ideology that business is an instrinsic good worthy of protection. In public policy terms, it is the belief that business will always make more productive use of capital than government, thus increasing prosperity and the common good. In practical terms, it is automatic recycling and endorsement of whatever any executive has to say.
Now, let’s get a few things straight about my own point-of-view. I am a liberal thinker, entrepeneur and businessman who shares much of the sentiment of the first two points above. But to me, as a media man and public policy interested individual, it is simply not good enough for the business media to endorse, as matter of course, the position of a business leader because…well…he’s a business leader.
The refrain from all of these businesses is the same. They will tell you that politicians and the public do not understand how their businesses run. That only they, as the employers, can tell you what are the pressure points for investment decisions and employment. And some will be right.
But this can also be the cry of the rent-seeker. Those that are dedicating resources to the maintenance of their own wealth, not the creation of new wealth that will trickle down to the benefit of all. It is the job of business media to examine which claims by business people are which, not simply recycle the views of the strongest players.
This is where I part ways with my brothers in the Australian business media. Seeking rents is all well and good for a business. But it is not good public policy to bend to it. Nor is it ultimately healthy for prosperity or markets, which are built on the premise of competition not monopoly and rent-seeking. That is how capitalism delivers the broadest social benefits, separating it from other other systems like central planning and oligarchy.
