Coalition pulls race card on CHAfta

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This is really daft. From Fairfax, the Coalition is preparing an ad campaign in favour of the China Australia Free Trade Agreement (CHAfta):

The couple are watching the union attack ads on TV with the man’s parents.

Father: They’re at it again

Son: Who?

Father: A ratbag union in the building industry is running racist TV ads against the Chinese. Last year Bill Shorten was attacking the Japanese

Girlfriend: I thought Australia wasn’t like that?

Mother: Most Australians aren’t, love

Father: But some unions have been running racist campaigns for years

Son: Why doesn’t someone stop them?

Father: Bill Shorten should stop them.

The leaked script says the ads end with the slogan “Free trade is good for Australian jobs”.

MB is vehemently in favour of free trade. It also acknowledges that deflating labour costs must be a key component of repairing national competitiveness. China wants this for its firms because it has experienced a wave of labour price shocks in its remote resources investments. That might have made some sense if Australians were not willing to take on that journey. But the next wave of investment will be in Australian urban areas around realty and tourism.

CHAfta is an underhanded and backdoor opening for Chinese investors to bring in cheap labour without any local labour market testing. Joanna Howe, a Senior Lecturer at the University of Adelaide Law School and an expert in temporary labour migration, revealed that ChAFTA provides only minimal protections for local workers:

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…the interpretation of what constitutes sufficient labour market testing is entirely left up to the department. This can be weakly interpreted by the department so that Chinese companies do not have to properly and rigorously test the local labour market in order to access Chinese workers…

Moreover, the protection afforded to local workers is contained in policy rather than law, as the requirements around the nature, type and duration of labour market testing is up to the department. These can be whittled away at any time so that the ability of these requirements to protect local workers’ preferential access to jobs becomes virtually meaningless.

What is needed in this debate is a full explanation of why labour, capital, government and households all need to carry their respective shares of the burden in repairing national competitiveness. Instead, under the Abbott Government, labour deflation was undertaken via rampant use of 457 visas, and that underhanded and socially destructive approach has been embedded in CHAfta, treating labour as the ideological enemy.

For a Turnbull Government that has supposedly dedicated itself to treating Australians like they had a few brains, pulling the race card on CHAfta is an exceedingly poor start. Where’s the narrative, Malcolm?

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.