We need a Royal Commission into political corruption

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By Leith van Onselen

John Warhurst, an emeritus professor of political science at the Australian National University, has penned a well-argued piece calling for a Royal Commission into political corruption. From The SMH:

…we remain relatively unconcerned by the parade of corruption and its near neighbour, unethical insider lobbying, in our public affairs. Too often, revelations are treated as individual instances – the occasional bad apple – rather than part of a pattern that reveals the stench of systemic decay…

Four Corners and Fairfax Media together revealed the extent of potential corruption caused by Chinese-Australian political donations on a huge scale to both sides of Australian major party politics. Several millionaire businessmen with links to the Chinese government and the ruling Communist Party have insinuated themselves into politics.

These revelations will predictably be met by the federal government and opposition banning foreign political donations. But such action has come about remarkably slowly in response to public pressure rather than being met immediately with urgent action by the political class. The response is piecemeal and limited once again, rather than a broad-brush investigation of a creeping cultural sickness at the heart of Australian politics.

Associated with the revelations of Chinese influence has been further evidence of the role of lobbyists and consultants within and on the fringes of the system…

Pressure has now mounted for a federal corruption commission and for corruption commissions in other states and territories, including the ACT, which have still not moved in this direction. Further restrictions on political donations will also undoubtedly be introduced and the necessary steps will probably be taken soon. The political parties are pragmatic enough to read the political winds.

But history will show that governments of all persuasions take only stuttering steps…

Too often, governments ignore the big picture. Consequently, the remedies proposed are often too narrow and fail to address the necessary internal cultural change. Governments are always quick to demand cultural change by other failing public institutions, like business, unions, churches and the armed forces, yet they are reluctant to apply such a remedy to themselves. We need a royal commission into insider politics.

John Menadue has also raised similar concerns about corruption:

Our politicians disgrace themselves and us. Former Trade Minister Andrew Robb walked out of the Cabinet and Parliament after negotiating the China-Australia Free Trade Agreement and into a $880,000-a-year job with a Chinese billionaire who has a 99-year-lease on the Port of Darwin. This followed a string of earlier ministers who took advantage of their ministerial experience to profit from lobbying…

There has been a revolving door between former Department of Defence officials and arms suppliers…

Many ‘independent’ think tanks like IPA and Sydney Institute are funded in secret by powerful vested interests…

Political lobbyists are having a field day in Australia. At my last count, there were over 900 full-time independent lobbyists working in Canberra. That is over 30 for every cabinet minister. On top of these “third party” lobbyists there are the special interests who conduct their own lobbying: e.g. the Murdoch Media and the Australian Pharmacy Guild. These lobbyists promote a whole range of interests (e.g. mining, clubs, hospitals, private health insurance funds, businesses and hotels) that have all successfully challenged government policy and the public interest. Just think what the Mining Council of Australia did to subvert the super-profit tax and Clubs Australia to thwart gambling reform. There is a lobbying swamp in Canberra that badly needs draining. These secret but powerful lobbyists are doing enormous damage to public trust…

We need a whole range of institutional reforms to win back the trust of the community, particularly the young…

We need to close the revolving door that allows politicians and senior public servants to take lucrative jobs on retirement in the private sector. Isn’t their pension enough? None should be allowed to work for three years with firms they have had dealings with as ministers or senior officials. We clearly need to draw stricter rules for lobbyists and make their activities transparent and public. We need a federal ICAC and major political donations reform. We urgently need a public inquiry into the role of Parliament and how it can be made an effective deliberative body again.

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Hard to disagree with any of this.

Over recent years, we’ve witnessed a veritable conga-line of Australian politicians going into well-paid private sector jobs after politics – often in the very industries that they used to regulate. Notable examples include Andrew Robb, Ian MacFarlane and Stephen Conroy, but there are others.

We’ve also witnessed possible widespread corruption relating to political donations, including from foreign powers.

And then there’s the various interest groups that seem to be pulling the strings on public policy.

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In short, there appears to be a prima facie case for ‘warts-and-all’ inquiry into political corruption and insider politics in Australia.

unconventionaleconomist@hotmail.com

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.