By John Haly

The War on Drugs, like the ones on terror, waste, poverty, and crime, are metaphors for institutional failures to address fundamental problems in our society. Aside from the fact that it is never clear when any of these “wars” will be over, it is also the rhetoric of a political failure to address social reform.

To date, the West’s pursuit of these wars has piled misery on misery (as wars are prone to do). Such wars ostracise the victims, casualties and collaborators in conceptual battles that have no actual target but certainly cause collateral damage.

The “War on Drugs” neither defines the problem nor allocates appropriate consequences for drug use. Moreover, this language does not improve the plight of those suffering. There is although, a long historical process which led to the development of the three international drug treaties and the international drug control systems for the more academically inclined. But for now, let’s simplify.

What is a drug but an ingestible substance designed to have a physiological effect? From that perspective, the orange juice I had for breakfast, morning tea and lunch fulfils that description, as does the small white pill I then popped to alleviate the acidic reaction in my stomach, that repeated orange juice consumption had created. Depending on what that pill was, government legislation may deem it acceptable or not.

The “War on Drugs” is usually framed to attack those substances any given society, country or State consider either “illegal” or harmful.  The media often frames drug addiction in terms of the (over) consumption, possession or distribution of goods that legislators have deemed to be “illegal”. However, that classification can, of itself, be arbitrary. For example, none of this captures the harm done by legal drugs, such as the prescribed opioid epidemic currently killing thousands of Americans (and making its way into Australia), or similarly, the ravages of alcohol and nicotine. Indeed, one of the key imperatives and justifications behind the push for law reform on drugs is that the classification of a “harmful drug” may not necessarily be based on any adverse physiological or psychological effect.  Cannabis is a case in point.

Cannabis in 19th and early 20th centuries was widely used in the USA and even for a while carried by pharmacies as a drug to treat migraines, rheumatism, and insomnia. Hemp was used as a superior textile used for ship sails and caulking. Just as Hemp grew to become a possible threat to US textile industries, Cannabis faced a challenge when in 1925 in Geneva a meeting of the League of Nations banned globally three plant-based drugs – opium, coca and cannabis.  America although did not follow suit till the 1930s when it became the patsy drug that the Department of Prohibition took on as a replacement cause for alcohol prohibition.  The ending of alcohol prohibition left Harry Anslinger (the G-man in charge) with a government department twiddling its thumbs and needing a drug to prohibit.

Racism and fear were used to outlaw Cannabis despite medical advice that it was not dangerous. An “alternative fact” campaign was waged demonising the drug and the Mexican sources for it until legislation banning it emerged. America then pressured trading partners to follow suit. You can read the real story behind its illegitimate banning in the links provided, but for now, let’s focus on drug law reform and how far behind, Australia sits, in its efforts.

Staying with cannabis, as a medically demonstratable drug to treat disease, we have moved way beyond migraines, rheumatism, and insomnia. Strains of marijuana have been used to treat Arthritis, Asthma, Bipolar Disorder, Attention Deficit Disorder (ADD), Cancer, Crohn’s Symptoms, Dyspepsia Symptoms, …. and a long alphabetical list of conditions listed on the Medical Marijuana site. There is although, an enduring medical debate as to whether it does effectively treats these conditions or not. The reluctance of the Therapeutic Goods Administration (TGA), AMA and college of Physicians to approve medical marijuana is not based on the medical opinions expressed for treatment remedies in places like Canada. Canada provides access to medical cannabis to nearly 130,000 people, while the TGA in Australia has acknowledged only 140 people here.

Like our medical authorities, there was a time when Canadian Doctors expressed their reluctance, as they did in a report in 2014. Three years later, the surge in demand for it as a medication, has seen doctors evidently more comfortable with its efficient use.

However, despite Australia being a nation of immigrants, we have an inherent distrust of learning from anyone else’s success with new or progressive technologies, whether the subject is medical marijuana, renewable energy, transport, immigration, education and the cost of education. We are just inherently stubborn, like a rebellious teenager, unwilling to learn from older advisors/countries.

Other examples of our recalcitrance in Drug Law reform, is Heroin-assisted treatment. As of last August 2017, it will be 20 years since John Howard prevented the proposed scientific trial evaluating the effectiveness of prescription heroin, killing off six years of scientific research.

In the meantime, countries such as United Kingdom, Switzerland, the Netherlands, Germany, Canada, Belgium, and Spain have all demonstrated success with the impressive results of their heroin-assisted treatment programmes. Denmark has also agreed to a similar plan although in its case started the programme without running a trial.  Why still be running trials when you can review the results from everyone else?

Staff assessment of patients determines not only that their patients have a medical dependency on the drugs but also that other approaches to wean them off this dependency have been unsuccessful. As such, it is not a first-line treatment, but more often a facility of last resort, and apparently a highly successful one.

Indeed, it is now not only made clear that heroin-assisted treatment has been successful regarding mental health, physical health, social functioning and adaptability, but also that it has had economic benefits. HAT is cost-effective because the benefits of the treatment exceed the costs. For example, the cost-effectiveness of the trials has been demonstrated in a substantial reduction in drug-related crime, and this is despite such programs treating barely 5% of the heroin using population.

Fig 1: Incidence of heroin use in Zurich following Heroin-assisted treatment

Dr Alex Wodak, the Emeritus Consultant for Alcohol and Drug Service at St Vincent’s Hospital, draws parallels with the treatment of alcoholism:

“The small minority with the (most) prodigious appetite for heroin accounts for a disproportionate share of the harm”, he said.

“But we know the alcohol market best:

• The heaviest 5% of drinkers account for 33% of the alcohol consumed
• The heaviest 10% of drinkers account for 50% of the alcohol consumed
• The heaviest 20% of drinkers account for 70% of the alcohol consumed

The heroin market is probably just as unequally dispersed, but we don’t have figures because the market is illegal.

So Heroin Prescription Treatment is about getting that 5% using – some maybe using $1000/day? – into treatment – to stop them recruiting more novice users.”

Removing these addicts from the drug scene, for which other treatment programs have had limited success, has had a big impact on the heroin market in the countries where such programs have been implemented. Evidence arising from these test programs has shown a disproportionate reduction in drug-related crimes and recruitment of new addicts. Switzerland, in particular, has been an example of this disproportionate change.

Fig 2: Estimated incidence of heroin use in countries where trends over more than a decade have been published

In a 12-year period of the trial in Switzerland, not only were there marked decreases in the estimated initial uptake of the drug in Zurich from 850 people in 1990 to just 150 in 2002, but there was also a reduction in quantities of drugs seized in Zurich. Australia is still only just discussing this as a possibility, according to Dr Alex Wodak when outlining the most recent advocacy efforts in Canberra for this program in August. It’s not even on the agenda in Australia now.

This isn’t the only area of Drug Law reform we are behind on, as evidenced by our responses to Medically Supervised Injecting Centres. In early September the upper house Parliamentary Legislative Council reported on a review for a medically supervised injecting centre in Melbourne. The Victorian Government was then required to respond within 3 months, bringing it to December before we can expect to see any movement.

Unfortunately, the current Victorian Premier is on record as being opposed to a MSIC, including making an election promise not to commit to it in his first term. Given that both the government and opposition have committed to positions competing on a commitment to toughness on drugs, it is expected there will be parliamentary opposition to this centre no matter who is in government. This is despite the fact that members of the local Richmond community and the media have come out in favour of such a facility. The residential group, the Victoria Street residents for an injecting room, has been particularly vocal in support in media interviews with Australian radio presenter, Jon Faine and Loretta Gabriel.

So the local community sees sense in it, and Europe is replete with success stories arising from their trials. Nevertheless, Australia continues to play the cynical, probing but not willing to commit “teenager”. One who suspects their older cousins in Canada and Europe might have a better insight into how this all works but damned if we are going to take the plunge.

When will Australia grow up? When will we cast aside our irrational fears of what might happen, given that there is no evidence to justify our anxiety (in fact, the complete opposite)? Australia’s change resistance is making us the laughing stock of nations. Everyone else is for Drug Law Reform, or Marriage Equality, or Climate Change mitigation, or progressive transport infrastructure, but not us. We still think medical cannabis will warp our minds. We still think marriage equality will lead to all sorts of perversions that no other nation on earth has encountered after committing to it. We still elect climate sceptics to parliament, despite having experienced a continuous chain of consecutive hottest years on record. We still spend millions on roads when public transport solutions have proved invaluable to far larger cities than we even possess.

So while this article is predominately about Drug Law Reform, our resistance is a cultural and political ideology, built behind a wall of entrenched fear and loathing of change and progression. Just because we are a young nation, isolated by vast oceans, settled by invasion, and used as a dumping ground for the unwanted of older cultures, we should not be afraid of emerging from our shells and taking on the lessons learnt by older, wiser heads. Youth is supposed to be characterised by risk-taking and adventure, being prepared to explore where older more cautious heads dare not tread. Instead, in areas like Drug Law Reform, amongst many other examples, we belie this potential, being afraid of our shadows, particularly when the shadows are cast from afar.

We need to be decriminalising Marijuana, making use of medical cannabis to improve health outcomes. We should be setting up Medically Supervised Injecting Centres to cut back the harm bad drugs do to our community. Also, we should be treating the severely addicted through programs like Heroin Assisted Treatment. The “War on Drugs” has had a huge cost to our community and the collateral damage has been far greater than it ever needed to be. The war needs to end. Peace needs to reign. Drug use should be treated as a medical and social problem, not a crime. We have tried the war tactics. They haven’t worked. As they say in the surgical parlance, “the procedure was successful, but the patient died”. Time to try something else.

This article was originally published on Australia Awaken.

By John Haly

The debate

The starter gun has officially “legally” fired on the government’s campaign for the alternative postal survey formerly known as the plebiscite. The all too predictable debate surrounding the question of Marriage Equality in Australia has finally begun in earnest.

Initial salvos have already been shot across the bow by the “No” campaign in recent weeks, raising uncertainty amongst the uncommitted. Despite this, the polls have long demonstrated a clear majority of Australians wanting Marriage Equality for some years. What is interesting to note here – presumably due to the prolonged nature of the political resistance – is that the “no” campaign’s latest arguments against Marriage Equality reform appear to have evolved.

In part, this could simply be due to the rebuttal against the “no” campaign’s original arguments having already been trotted out ad nauseam. Indeed, Eric Abetz, a long time serial disparager of anything remotely “gay” / homosexual, published his objections in the Canberra Times in 2015. I penned a long response of my own, although it is ground I am not looking to retread here.

Hurry up Australia, you’re going to be last in the race.

The earlier anti-reform arguments haven’t been abandoned entirely. Andrew Hastie has rehashed them recently. At a cursory glance, the local “No” campaign in their latest tack would seem to be most obviously singing from the same song sheets already utilised by largely unsuccessful opposition campaigns run by organised religious interests opposed to similar reforms (now won) overseas. But on closer inspection, the reality is more invidious.

This “new” campaign angle is really not so new. It is in many ways an age-old playbook of home-grown homo/trans/bi-phobia harkening back to every major campaign conducted in Australia opposing any and all LGBTI legal reform dating back to decriminalisation of homosexuality in the 80s. But with the re-purposed survey upon us and their lack of success to date in prosecuting these earlier positions, the “No” campaign has revved up their anti-Marriage Equality rhetoric.  Demonstrated by suddenly expanding their oppositional repertoire.  Evidenced by the surprising emails, I began receiving from the “oktosayno” website. While the arguments may have shifted subtly, I would suggest if I may, that the reasoning on display is still not that nuanced, intellectually rigorous or engaging. But if burying yourself in disingenuously privileged and solipsistic opposition for its own sake doesn’t sound like your idea of dear leader Malcolm’s long-promised exciting times, I’ve already done the work, so you don’t have to.

Sodomy is sexual abuse

The next generation will bring marriage equality into being.

Religious concerns are often based on the fallacious belief that sodomy, as it was expressed in the Bible, was about homosexuality.  But even an ABC article has pointed out that “Sodomy”, as it was expressed in the biblical literature, is about rape and sexual abuse. That the church has illegitimately changed the meaning of the word, is understandable. If you’re in the Catholic priesthood, you wouldn’t want the bible to be condemning predilections that your organisation’s members are infamous for, especially concerning small children. More surprising is that “homosexuality” as a word – not in existence till the late 18th century – has found its way into the Bible. Christ said nothing about homosexuals but had a lot to say about “loving one another” which seems to be a point many in the evangelical community have missed.

Procreation

Marriage Equality provides legal protections for Children

Then there is the recurring issue of children. Often raised by those most in denial about the already large numbers of same sex couples that are quite happily and successfully producing and raising children. Concern for children seems restricted to those that are raised by heterosexual couples, despite the fact that when it comes to family stability, studies are proving that heterosexual parents are not always managing better family outcomes. But the opponents to Marriage Equality seem to be unduly concerned about issues of procreation.

Procreation and Marriage are not necessarily related. Either one may be the cause of the other to occur, but the sequencing can fall on either side of the other. Alternatively, procreation or marriage may happen in isolation without the other ever being involved. The Marriage vows in contemporary western society are usually about an expression of love between two adults. Children aren’t involved, even if they are already at the ceremony standing by their mom or dad or step-mum or step-dad.  It’s not their marriage!

Marriage Legality

Beyond the emotive distractions, Marriage equality is about human rights

Marriage Equality is about justice and law, not about religion and procreation. Modern religious communities have appropriated “Marriage” and claimed it is theirs to dictate how and to whom it should be applied. However, marriage as a religious undertaking not only predates these religions but in the Christian’s case, it wasn’t even included as a religious celebration till the 9th century. Even then the ceremony didn’t include a priest till the 12th Century. Back then, as Peg Helminski very smartly points out, Marriage was, in fact, a contract between two men.

“In the beginning, marriage was a relationship between two men. A man exchanged goods or services with a girl’s father to procure a virgin bride—a bride who likely became one of several wives. This way, he could assure himself that any children he supported held valid claim to his property. Yes, marriage began as a business transaction to assure male property rights. Often, marriage provided other benefits; increasing the family labour force, acquiring a trade agreement or securing a political alliance.”  Marriage and its legal prerogatives have changed a lot since then, regardless of any religious claims to inviolable and unwavering immutability.

Marriage, today, should be about the two non-related Adults legally acknowledging their love for one another. I am appalled that I have to expressly use the term “non-related” as I have seen social media claims suggesting it a slippery slope to incestuous relationships. In the unfounded nature of arguments that arise, the assumption that the parties are not direct descendants or siblings, including adopted (by law) relationships, has to be re-stated. Disallowing relatives are all outlined in Part 3 of the Marriage Act 1961 under the heading “Void marriages” Section 23. Not being able to marry minors is in Part 2. Marriage equality is about changing the Act’s definition of Marriage as between “two people” instead of “a man and a woman” and removing section 88EA in Part 5 (added by Howard), not Parts 3 or 2.

The marriage equality movement wants to change only five words for two in the Act and remove the section Howard added in 2004 because he realised the Act was “gay-friendly”.  That renders genderless, the subject of who can legally marry. In short, “two people“, not exclusively “a man and a woman“. So no Eric Abetz, polygamists, need not apply. Also prohibited by Part 3! Nobody in the Gay and Trans lobby groups is asking you to change Parts 3 or 2 so why do you – as a Lawyer – not understand?

Church denial

Marriage Equality is about equal human rights not exclusivity for some.

Church’s will still retain the right to deny marriage ceremonies from people they don’t want to have married in their churches. Irrespective of whether they are Muslims, Buddhists, atheists, non-attendees, the great spaghetti monster worshippers, or even gay. (Part 4, Division 2, Section 47 of the Marriage Act) It is about legal equality not ceremonial! It is, not about excluding a group in the community, even if they follow the great flying spaghetti monster. (The supreme creator of the universe – OK I am getting personal here, and I must confess in the interests of transparency, to being a signed up member of that “church”). It is about allowing a relatively significant minority group access to the rights and privileges the vast community already has. It’s access to the legal (not religious, not procreational) right to be married. Marriage ratified by the State, not the Church.

Political Correctness

Resistance to political correctness as an argument is odd or at the very least, anti-social. Yes, extreme aspects of PC have become draconian. But marriage equality isn’t about being draconian; it is about being fair. For the most part, political correctness is what everybody who isn’t a bigot, calls politeness. Yes, Mr George Brandis and Mr Scott Morrison, you do have the option (perhaps rather than right) to be a Bigot, but the rest of us want a civil interaction that will build a cohesive society that binds us all together, not separates us. The likes of Peter Dutton, Andrew Bolt, and Tony Abbott may rail against political correctness, but if the alternative is the sort of hate speech and fear mongering you lot love to express quite freely, the rest of us wouldn’t mind skipping. Political Correctness started as a “counterweight to prevailing orthodoxies and power,” and although it in particular cases turned oppressive and shrill, it originated out of trying to protect communities such as the gay ones, and as such, still has value and relevance. Marriage Equality is working to do that. So despite the enduring prevailing will amongst the oppressed and marginalised to speak truth to power, the “no” campaign’s freedom of speech is still equally well preserved.

The unbeatable argument

Vote “Yes” loudly!

There is one “No” campaign argument for which I have no rebuttal. It is one advanced in one of the many satirical pieces that arose out of opposition to the first televised Ad of mothers talking about concerns for their cross dressing children and safe school issues. (Small note: Safe schools is about bullying in schools and has nothing to do with marriage equality, people). The counter Ad shows young women talking about how she had planned her marriage for months but that it would never begin to compete with gay individuals who have been planning their marriage for decades. That “wedding competition” line has to be the most valid argument for the “No” vote campaign. It made me laugh and then realise, that’s quite a valid fear. You’d better believe they have been waiting for that day for years. It will come, and the weddings will be fabulous!!

This article was originally published on Australia Awaken.

By John Haly

Identifying bipartisan values within in our polarised political class is hard. Common ground is elusive not only because the values represented by politics have changed, but discerning the truth in an alternative fact world, filled with propaganda, is problematic. What values do our politicians really hold, as opposed to what they say, they do? What do our representatives really value and what leverage can we apply upon finding commonality between Liberal and Labor or Republican and Democratic representatives?

Our economic commonality

Once upon a time the Republicans stood against slavery, fighting a bitter civil war over it (even if the recently installed president Donald Trump himself, is not sure what that conflict was all about). But now, the red shoe is very much on the other conservative foot.

The American economy was built on slavery, but the emancipation of the black population forced America to reconstitute slavery, redefining it by way of contemporary political spin. The now changed and more authoritarian Republicans have achieved this by instigating the largest per capita incarceration rate in the world, where prisoners slave for the private industrialised markets. And attempts by previous President Barack Obama to curtail this “market” are now being undone by his successor’s moves to boost it.

There are striking similarities in the Australian experience. Although rarely recognised as such, our own initial economic growth was also predicated on slavery of the convict and pacific islander variety. So we can claim no high moral ground. Similarly with America’s passion for “rule of law” and the devising of ever more draconian reasons for increasing incarceration. By way of example, where drug addiction and mental health are succesfully treated as a medical issue in more enlightened countries like Norway, in America and Australia they are still legal issues used to feed prison populations.

Australia is also no stranger to political ideology (once foreign and abhorrent to party politics, but which is now being swallowed whole). Australia as one of the instigators of, signatories to and loud supporters of the UN refugee human rights platform, now holds refugees in foreign gulags across our oceans. Such treatment would have been unthinkable to foundational conservative stalwarts such as Robert Menzies, who in 1954 was amongst the first to ratify the Refugee Convention. Once we in Australia reached out to refugees and embraced them as new neighbours into our community, bringing food parcels and contact to strangers. Today we have the increasing fiasco of scandals and mistreatment of refugees, first by Morrison, and now by Dutton.

Once upon a time

Political relics change with time but society’s memory is short lived

Looking back, we were less afraid, our news of the wider world more limited. Admittedly our situation was hardly perfect. We were more openly racist as evidenced by the White Australia Policy. But we were also less willing to lie and obfuscate to justify our injustices. We were also more courageous, a little less insular in some manner, and far more attracted to science, wonder, community, tribalism and extended “families”. Our societies here and abroad had a larger and more prosperous middle class. Greed was a vice, not a virtue. Class distinctions may have seemed more obvious, but now – when they are more prevalent – they are less discussed. We used to be about societies but now we are all about economies. Interesting reading on that subject can be found in “An Economy is not a Society” by Dennis Glover.

Left and Right wing politics, Democrats and Republicans, Socialists and Conservatives stood for different approaches to the politics of life. Distinctions that existed have disappeared over time. The middle classes are vanishing and now the real polarisations are the rich and the poor, certainly not left and right. Christ was right when he said “the poor you will have always“. One wonders if he actually realised just how vast the gulf would eventually become between the poor and the rich (whom he frequently addressed to do something about it)? Money and it’s influence have become the ultimate distinction in western society.

“Greed is good!”

It no longer matters if you are Democrat, Liberal, Labor or Republican, as the common thread that holds our politics in undivided loyalty is greed. The sort that Gordon Gekko from “Wall Street” once famously declared was good (although a lot of his speech was also about the complacency of the powerful).

Helicopter scandals, perks and privileges should face ICAC

Today our political class embraces greed and complacency without reserve or hesitation. Politics is a lucrative business, as the recent scandals from One Nation demonstrate. Lobbyists, corporations, developers, the rich and empowered all bandy both “sides” of the political spectrum with donations, lucrative “political retirement” jobs and financial funding access. The political arena is awash with nepotism to jobs for the boys. That is on top of the significant salaries, lifelong pensions, travel and security concessions, and business opportunities, which are the dividends of a career in politics. Though even in these shameless times, perhaps Mike Baird, could have spared a little more effort towards maintaining the illusion of some propriety, by spending a little more than six weeks with his “ailing family” (his avowed reason for suddenly quitting the hallowed position of NSW Premier), before taking up the far more lucrative banking industry role with the million dollar salary.

The “sides” that successful political parties hold to today, are small deviations from an overall shared conservative class of values, with greed always being at the center. The “left wing” parties follow the “right wing” parties who have a differential approach to following the money. The pursuit of that money is closely followed by corruption, as the NSW ICAC has repeatedly found on both sides of politics. I attended a lecture by Dr Knox-Haly at the University of Sydney’s 5th floor Abercrombie Room on the history of ICAC on the 19th of May 2017. Also in attendance was Elizabeth Kirby, the longest serving State Democrat MLC (now retired). While asking questions afterwards, Elizabeth pondered why both parties avoid a Federal ICAC. Dr Knox-Haly speculated that the differentiation for corruption between our primary two parties, was while the Liberal’s entitled mentality has little insight into their own corruption, “The difference is, that Labor actually has some insight that what they are doing, might be corrupt“.

Electing democracy

The “left wing” stay just marginally behind their similar “right wing” counterparts, for the purpose of declaring their “distinctions” to attract a community of voters who will largely vote for the “lesser of two evils“. Unfortunately, clever gerrymandering, electoral colleges, systems of disenfranchising classes of voters, legal court challenges and strategic alliances more often than not, ensure the public majority will is ignored.

In the recent American presidential elections, the Democratic candidate (Hillary Clinton) received three million more votes than the Republican candidate (Donald Trump), but due to the electoral college system, the Republicans won the presidency. Dismissing 3 million people as an example of fraudulent voting is not just unproven, intellectually lazy, ludicrous, and credibility stretching. It is also an acceptable lie, which relieves the “true believer” from any intelligent engagement in politics.

Similary in Australia, according to the AEC 34.73% of the electorate voted Labor and 28.67% Liberal in the last federal election. But political alliances with the Nationals and preference systems ensure the Liberals currently hold power in Australia, although only by the majority of one seat. Adding all Liberal, National and LNP primary votes, only accounts for 41.80% of the 13.5 million voters in Australia. In France, the majority voted against National Front candidate Marine Le Pen, and yet with 21.3% of the vote, she was still one of just two finalists in the last round of French elections (which she lost).

Trump won the American presidency but not the popular vote, because of an historical, artificially weighted voting system. It is arguable that there may have been good reasons for such weighted voting systems historically. But as times and circumstances have changed, such electoral systems have moved from serving the common good, to more likely serving small select interest groups driven by avarice and greed. Gerrymandering has largely been discounted in Australia by non-partisan boundary selections, but it is rife in America, even though it loudly and proudly proclaims itself to be the longest lasting “democratic republic” in the world.

Origins of the Neo-liberal agenda

None of these weighted electoral voting systems started out as corrupt. The rebalancing undertaken was merely meant to provide a more equitable representation of the will of all of the people in a polity. For example, to avoid giving greater or overwhelming national influence to more populous urban and coastal areas, over the needs and will of smaller regional inland populations. A reasonable proposition on the surface of it.

But societies and technology have changed slowly over time, and unfortunately that electoral system has simply not adjusted (enough) to the changing nuances and circumstances of contemporary life. As a result, the erosion of democracy did not occur suddenly. The rights of the majority were rather whittled away through successive governments from both “sides” of politics. Privatisation of Public assets in Australia did not start with Conservatives, it began with Bob Hawke and Paul Keating. The “socialist” Labor party divorced itself gradually from its roots in the Union movement and its support of the working class. Similarly, Trump is not a new phenomenon. The pathway there was laid by Democrats and Republicans equally.

Obama was not a “socialist” black man.  He was a privileged, wealthy man complicit with the greedy, über wealthy class he mingled with and still does.  Unlike Iceland, he did not jail the people responsible for crippling his country’s economy, he paid them off. That mistake has cost America dearly. A repetition of a formula that has never worked but is repeatedly applied. The gold coloured glasses of privilege and wealth screened out the faces of the poorer masses, who had otherwise hoped that because he shared a skin colour, his filtered eyes might see their plight. His foreign policy was deplorable when it came to the Middle East, when you consider that Obama bombed seven countries adding to an enormous refugee crisis in Europe.

While I am being harsh with Obama, there are many things that are commendable about his administration, not the least of which is the extraordinary efforts he made to create (the now endangered) Obamacare. To be fair to the balance of this article, you should read the Rolling Stone’s article in regards his successes and failures. The good that a man may do, whether it is Obama or Keating, is oft undermined by what they either failed to address, or any concessions that were made to not ruffle the feathers of the wealthy cocks in the hen house.

Inequality

European lighthouse warning Australian economic/policy shipping

Neoliberal politics from both the “left” and the “right” have had a debilitating effect on egalitarian democracies. Neither “side” of politics (Labor/Liberal or Republican/Democrat) have a policy platform designed to rectify inequality, or our increasingly controlling police state, or our endless pointless involvement in wars on the other side of the planet. The best we can hope for is to be a little less unequal, by choosing a candidate that leans towards helping the proletarians.  Instead each “side” have internalised neo-liberal conservative values to a lesser or greater extent. Unless either side tailors a persuasive vision of real world solutions based on evidence – as opposed to ideology – from more successful democracies (i.e. Europe), the downward spiral of inequality and social class division will continue.  Unless the “lefter” side of “right” begin to propose policy platforms that could achieve a shift away from what cripples our economies, then they will continue to lose elections and the public’s faith.

It’s just a step to the left

Interestingly in Australia, both Labor and Liberal have begun leaning a little to the left (Labor in policy and voting history, and the Liberals with regards to the 2017 budget). A departure from previous history. Such wins are small and their longer term future uncertain. The positive aspects of the 2017 Liberal government budget and health reforms, still exist in context alongside other classic neoliberal policies, such as tax breaks for the wealthy at the expense of the impoverished. Both Trump and Turnbull share the delusion that trickle down economics is a way forward, despite all the real world evidence that it has never worked. Wages and jobs remain depressed in both countries and unemployment is the only growth area.

Death by 1000 cuts

Very few of the changes that harm our society are rushed, although the Rebublicans are certainly trying it with healthcare. Once suggesting the nascent beginnings of a possible policy paradigm shift – the very likely soon to be extinct Obamacare – has proven to be merely an ephemeral reform, yielding to an upsurge in the everlasting tidal vices of greed and self interest. Likewise, the increasing incremental attacks on Medicare in Australia are following a similar path by way of stealth such as freezes and coverage removals leading eventually to an American privatised style medical system.

Of course, even Trump recognises that Australia’s universal healthcare system is currently still a long way from being anything like what they have in America. However, the eventual dissolution of Medicare was never going to be a matter of outright overnight dissolution, in the manner that Trump and the Republicans are seeking to achieve with the dissolution of Obamacare. Rather, it will be the gradual death by one thousand cuts, with Australia gradually devolving to a system where big phama, hospitals, insurance, bio-medical and prosthetic companies garner huge profits at the expense of failing health and ageing demographics of our society.

Paths once trod we follow

Are the Roman and American empires fates entwined?

With so little political differences in policies, how will any of this change? Being self-contented and tranquil is the domain of spiritual gurus, saints and philosophers, but many of us find our political plight disturbing and seek change. America, although, is as unlikely to change anymore than the Roman Empire once did. Only collapse or revolution ever bought about real change in the Roman Empire. Is America’s only hope therefore, its eventual collapse? And even if that occurs how will it ever satisfy its insatiable vice of greed? How much longer will it take for Australia to follow that path? Do we have hope of another, less-traveled path? Is there hope that we are not as America-lite as some dread? For example, if you have to go to the pains that Matt Wade did to assert our differences, is that because he is aware of how many similarities we have? How long will such differences remain? And if either nation changes course, for how long shall we stay that course, guided by the sort of people that are currently attracted to a polity where self aggrandisement and avarice takes precedence over leadership, governance and vision? Some vices transcend time, revolution and society.

This article was originally published on Australia Awaken.

By John Haly

“We are bringing the 457 visa class to an end”, announced Mr Turnbull after Easter, “…We will replace it with two new temporary skills visas.” With a quick slight of hand, Turnbull re-branded the much criticised 457 visa with two – as yet unnamed – programs to bring foreign workers to Australia. Though new rules and security checks were mentioned, he ensured that he would guard us from the impeding “threat of permanent citizenship” of intelligent and skilled foreigners whom our employers have sought out. Rest assured, Turnbull has proclaimed he will keep us safe from having people of this caliber, stay in Australia.

As Australia returned to work after the Easter long weekend, Malcolm Turnbull reminded us we were a nation of immigrants but we should not be overrun by too many more. With the Australian workforce apparently foremost on his mind, Turnbull told the nation (first via Facebook) that the 457-visa program was being scrapped for two new innovative temporary foreign worker schemes to tackle our unemployment issues. In restricting that program and although unnamed, he proposed two new visa programs with fewer job role options, new market tests, English language, skills and experience requirements.

The first reminder that comes to the fore concerning these new reforms that “put Australian’s first”, is a reference to similar policy I’ve previously heard. Didn’t Julia Gillard propose something similar herself in 2013? Didn’t Malcolm Turnbull criticize her for striking at the “heart of the skilled migration system”?

457 in decline?

Leaving Turnbull’s change of perspective aside, the numbers of 457 workers in Australia have been a subject of much speculation and false rhetoric by politicians seeking to introduce alternative facts and in some cases, outright bigotry. 457 visa numbers have been following a pattern of decline in the last few years but a significant aspect of that in the annual cyclic pattern.

In terms of the 2016 decline of numbers in Australia in any quarter – providing you limit your scope – it looks significant. The first quarter of 2016 (March) there were about 177,390 people in the country working under 457 visas.

Annual patterns of 457 workers in Australia

Since then it dropped slightly to 170,580 (June), up a little to 172,187 (Sept), and dropped significantly to 150,219 (Dec). Now, while these last figures may create the illusion of a significant fall, you need to look at the annual pattern of numbers over the last few years. Stepping back and reviewing the last seven years, a pattern emerges for every year. (Rising sharply, slight fall, slight rising, sharp fall). The pattern – as graphed here – will show you that it is about to jump back up again, so there is a deception inherent in quoting the last quarter’s figures of any year as indicative of where 457 figures are or will be. 457 visa figures have a predictable annual cyclical pattern. Turnbull’s timing made before the Department of Immigration released the last quarter’s figures creates the short-term illusion in media reporting that the coalition is indeed clamping down on 457 workers.

Workers come and go. Totals expressed in net movements of visa entrants – over periods such as a year – hide the significant seasonal change in numbers in the country. So when it is stated that 33,340 of the 40,100 primary applicants lodged 457 visa requests in the first quarter of 2016 were successful, and that this is a decrease from the same time last year, what is notably absent is how many 457 workers left. This is also dependent on which quarter you choose. So pointing out that – during the third quarter of 2012 under Gillard – that 35,452 foreign workers entered the country, ignores that only 14,665 entered in the last quarter of 2009. The coalition cherry picking numbers from specific quarters to disparage Rudd/Gillard’s record – that in actuality had both the highest and lowest intake of 457 Visa workers – is perhaps a tad disingenuous.

Annual cycle aside, it is still true to say the average number of 457 workers in the country since the coalition took power has been larger than the number of government recorded job vacancies in Australia. To keep it in the context of the last 457 worker totals released by the Immigration department, there were 165.9K vacancies in Dec 2016. 457 workers had done their customary annual December quarter drop to 150K, down from 172K for the previous quarter. Unemployment at the time (Roy Morgan’s figures) was at over 7 times that amount at 1,186K or 9.2%. If you added Morgan’s December underemployment numbers to the unemployment, then you reach a number nearly 16 times the vacancy rate at 2,584K. I am not going to entertain the ABS figures because of their inherent inaccuracy.

So even if you threw out all the 457 visa holders in December representing less than 1% of the workforce and made all their jobs available, it would have little impact on the 2.5 million both under and unemployed. This is particularly so as the presumption is there are no available Australians in the market who have the skills necessary to fill these roles. This begs two questions.

1. Why is it so?
2. Is it so?

Why 457?

Introduced by John Howard in 1996, the 457 Visa program has been beset by concerns about fraud, corruption and need. Fraud, we will get back to, but the need for it is still a failure of policy. Howard claimed it was to enable employers to address labour shortages in the Australian market and yet after 20 years, we still need to address skill shortages? You’d have to wonder after 20 years, about an economy and a national policy framework that has so failed to raise the skill levels in Australians, that we still need 457 visa workers. How is that “in the national interest” as Mr Turnbull so frequently repeated? A medical degree takes 6yrs, engineering 5yrs and a commerce degree 3yrs. So what has the government been doing in the last two decades? Why have we been unable to educate and upskill our population? Why is this foreign labour market even necessary? To answer that, we need to go back initially to Howard and ask how he began to prepare our children.

As a western nation which once boasted of free education for it’s population, the growing restriction of education to the people has had consequences for our labor market. Howard changed how education was funded by allocating considerable funding to private schools and undercutting public schools. Students drifted away from public schools to the better-funded private schools, where they could afford the luxury. The public school system was left with a community of poorer demographics with less time or capacity for higher education and an increasing inequality of educational results. The social class division between the affluent and the underprivileged then began at school for children. Two decades later the Program for International Student Assessment (PISA) survey shows Australian children falling behind in education. Segregating our schooling system by either academic or social class boundaries have been largely to blame for our children’s poor performance. Our ranking for investment on the OECD league tables for education is 22 out of 37 1n the OECD. Low expenditure is followed by low results.

Whitlam onwards

Leaving high school for TAFE or University has done little to revoke the class distinctions established by Howard’s redistribution of school funding. Whitlam abolished fees for TAFE and university students and provided support for apprenticeships through the National Apprenticeship Assistance Scheme (NAAS). Hawke reduced funding and re-established costs to students as well as changing labour market programs around apprenticeships and introduced traineeships as a major response to rising youth unemployment. Trade apprenticeships flourished as the government focused on traineeships. Mr Keating started governments down the neo-liberal path of privatising the public sector. The problem with privatising the public sector was that these were the main generators of apprenticeship training such as electricity utilities, telecommunications, defence industries, rail, roads, and Australian airlines. Howard also continued to undermine the public sector which contributed to a reduction in skills training – via public sector apprenticeships. Howard quickly consolidated apprenticeships and traineeships under a single umbrella and wrested it away to unions and into the hands of employers. Skewing support for apprenticeships heavily in the interests of employers was followed by a decline in training delivery, apprenticeship completions, pay and conditions. None of which was aided by the further dismantling of the industrial relations system, through the introduction of enterprise bargaining. While Rudd and Gillard dismantled Howard’s “work choices”, they still followed the traditions of the Hawke/Keating legacy by “make[ing] concessions to the big mining companies, reduc[ing] corporate tax, and restrict[ing] unions rights and push[ing] through spending cuts to maintain a budget surplus.” The decimation of manufacturing under Abbott destroyed yet another training base for trades, and reduced the intake of apprentices.  The budget cuts of his administration also severely impacted apprenticeships. Tracking the causes, consequences and level of damage to our employment economy have been made all the more difficult by Abbott’s savage dismantling of expert advisory panels as compiled by Sally McManus.

The combination of factors including the dismantling of education, expert advice, the industrial relations system and the public sector meant that a four year apprenticeship in the building trade gets replaced by a shallow sixteen week CBT course as the bare minimum for that specific role. The results have been described as “a disaggregation of skill which is ‘modularised’, ‘flexible’ and ‘atomised’ … [that] will ultimately leave skills ‘fragmented’ at their core.”

Many apprenticeships as a means of training up in skills for increasing levels of youth unemployment have largely vanished by comparison. For example, Federal funding for NSW Tafe reached it’s zenith in 2011 and thereafter decreased. Deregulation of training provision meant funding to non-TAFE and private providers increased by 20%. The consequence of this produced the rise of dodgy private providers of vocational education and also the unscrupulous practices by some private providers which have become a scandal in Australia.

No matter the skill training, your always schooled in Finance!

Add too, what Abbott euphemistically referred to as “Fee Deregulation”. Attempts to rectify the class based education system via Gonski funding were scrapped and the vocational education sector simply received new student loan systems, all of which has done little to encourage Australians to “buy” education. The end result has been a drop-off in education in Australia as students fall by the wayside, get ripped off or – even if they do complete their degrees – are faced with indexed debts that limit their employment capacities in a market of decreasing full-time jobs, low vacancies and enormous competition from other under and unemployed members of the workforce. Skills shortages have been a function of deteriorating access to Education driven by political policy.

Is there a skills shortage?

The distribution of 457 visa workers (image from The Guardian)

It is, of course, true to say we do have skill shortages. The question as to what extent any occupation is genuinely suffering from a skill shortage – is problematic. Questions arise as to whether the request for that skill simply represents an opportunity for an employer to take advantage of a compliant, cheap and deunionised workforce. Most reports whether from Flinders University or the National Institute of Labour studies have all rather reflected the opinion of the Flinders University report that “Despite the attention paid to skill shortages, the evidence used to evaluate their incidence and the causes and responses by firms remains thin.”

The problem predominately is that the labor market testing for skills shortages will still be conducted by employers – not by an independent panel. This will do nothing to affect the corruption at the core of exploitation of 457 workers.

Turnbull has announced that 216 job roles will no longer be covered by the renamed 457 visa scheme. The problem is that Turnbull’s new visa jobs list would affect just 9 per cent of the current 457 visa holders. So essentially he has cut an already redundant list of skills requirements – at least a quarter of which have never been applied for in the last year. Turnbull has not addressed the issue of employer rorts because the determination of a genuine skills shortage has been so easy to defraud. Underpaying 457 workers has been pervasive amongst dishonest employers.

In the absence of a plan to rectify education, the public sector, independent labour market analysis, unemployment, jobs and growth Malcolm Turnbull’s reinvention of the 457 visa scheme does little to aid Australia out of the economic malaise. Without attention to these issue now, we’ll be obsessing over skill shortages and “temporary” foreign workers in another twenty years.

By John Haly

Centrelink has been fraudulently issuing debt notices to people who owe no money. Persons so identified are then harassed and threatened to the point that they pay this un-owed debt rather than being penalised by a system, which they already know actively disparages them.

Labor’s Anthony Albanese, while being concerned about this government’s debt collection said, “No one would argue [against] that if someone has a debt from Centrelink, had payments to which they were not entitled, then it should be repaid“. I would argue to the contrary.

The Poverty of Welfare

Centrelink’s services exist to ensure the disbursement of social security payments whether that be for unemployment, or aid for families, carers, the disabled or indigenous. That financial aid in many cases has rarely increased, and in some has decreased in terms of CPI value. In the case of the baseline unemployment benefits, though indexed to the CPI, “there have been no legislated changes to real Newstart rates in over 20 years”, in fact since 1996.

Image from tai.org.au

This has raised legitimate concerns that the Newstart allowance is well below the poverty line,  which is an issue championed by:

• the Unemployed Workers Union,
• the Australian Council of Social Services,
• Anglicare,
• and the ABC (although that was prior to it’s current management).

Rorters! From Welfare or Multinationals?

These inadequate payments entrench poverty, inhibiting rather then aiding workforce participation. Mobility, presentation, education, literacy, and skill acquisition all cost money.  Financial stress adds to social marginalisation. Bullying by the job networks and policy victimisation generates social ostracisation in the community, and also limits possibilities for the unemployed and disabled.  So sorry  Anthony, but I am very much inclined to believe that if anyone got a little more money out of this dysfunctional system than the government was prepaired to provide, then they deserve to keep it.  Any extra money would only increase their chances of improving their lot, including their ability to contribute to the economy and to finding work.  Instead of attempting to recoup $3.5 billion in alleged “welfare debts”, why is the government not energetically recouping $6 billion from the tax dodging multinationals? 

What about getting a job?

The divergence between the Government’s unemployment numbers and Roy Morgan’s (image from roymorgan.com)

Numbers don’t lie but as the ABS knows, how they get presented matters. Apart from the financial constraints, there is the statistical improbability of finding work in any way. Roy Morgan demonstrates unemployment figures in December 2016 were 9.2%, which involves 1.186 million people. In fact, when you take into account underemployment, which has risen another 10.8%, the pool of potential job seekers rises to 2,584 million. All of these job seekers are competing for approximately just 163,100 jobs Australia wide (Nov 2016 Dept. of Employment IVI stats.). In the worst-case scenario, there are at close to an average of 16 people for every single job in the market and that doesn’t take into account the following:

• the new year’s rush of young school leavers,
• foreign workers with reciprocal work rights,
• current workers seeking to change jobs or
• the new entrants to the unemployment lines as car manufacturing in this country vanishes.

And now, just to add to the psychological and financial pressures inherent in looking for work, the government has come up with a new strategy to inhibit your search, by occupying your time with digging up old payroll records. The news of this new tactic is ever-present. Twenty thousand people a week receive notices of debts – allegedly to recoup incorrect welfare payments. All of which are triggered by an automated debt recovery system, which is under intense criticism because of what is essentially, the (intentionally?) flawed logic of a computer algorithm.

Erroneous mathematics

Centrelink’s computers (IBM machines in case you were wondering) are attempting to match tax office data with Centrelink records to determine if there are discrepancies between Centerlink financial information and Tax office records.

But an inherent incompatibility exists between these two data sources, and it is a matter of timing. Centerlink has information about its payments made fortnightly, and possibly data relevant to jobs which clients were offered and accepted. Centerlink is unlikely to be aware of the continuing circumstances of that job or subsequent ones found independently in the course of any given financial year. The tax office has only an annual summary of income. There is no breakdown into weeks, fortnights or months. There is no breakdown of pay rates, when it was specifically known they earned it, or what changes to income streams occurred in the course of the year. The tax office data is therefore incompatible with Centerlink’s data. The government is comparing apples with oranges.

Despite this, Centrelink’s algorithm takes your yearly income as reported to the ATO, and averages it over each fortnight of the year. As any primary school age statistician would recognise, an annual “average” apportionment cannot measure individual fluctuations and is a flawed measure in any given fortnight. To assumes absolute consistency for all fortnights is absurd on a number of levels. The only group that may get close to this pattern are the fully employed and even then, there are allowances, overtime, uneven hours, holidays, sick leave, RDOs, wage rises, wage falls, changes of roles, and any manner of occurrences that will alter the payroll for any individual over any given week/fortnight. Certainly, the most unstable employment group and the most likely to have variants are the unemployed. It is common sense that if you are dealing with people who move in and out of employment in any given year where they may move from poverty one fortnight to sufficiency (or if lucky, excess) the next. It is common sense that averaging their yearly income will produce inaccurate results by which to measure any given actual fortnight.

Guilty before proven innocent!

So what does Centerlink do? They take the ACTUAL fortnightly records held by Centerlink along with any limited volunteered data and try to cross-reference it against a fortnightly averaging of annual taxation income data. The normal presumption of statistical probability would tell you the likelihood of such figures matching for this demographic, is extremely unlikely. You would have to presume the mismatches will be the most common occurrence. Any programmer (and I worked as one for most of my career) would tell you such a matching is deeply flawed. Therefore clients should be approached with the assumption of innocence. In the absence of specific information in Centerlink’s internal records for discrepancies, inquires should be made tentatively as to why there might be a prima facie case for a mismatch in numbers. The onus of proof should also be on Centerlink (and not the client), as the process is so obviously flawed. Something fully recognised internally within Centerlink, if not by the political policy makers. In the face of the inherently flawed logic of this approach, innocence till proven guilty would be the legally prudent course of action.

Debt assessment is followed in 3 weeks with debt claims (image from auswakeup.info)

So what does the government decide is the best course of action? To implement a process that presumes people to be guilty (of debt) till proven innocent. Twenty thousand welfare recipients a week have been receiving notices that they have 21 days to prove their “innocence”, or be hit with penalties. These include a 10 per cent debt recovery fee, jail time, a restriction on travel. The event for which they are being investigated may be anywhere up to six years in the past. Some recipients are paying up, not because they accept that they actually owe the debt, but simply because they can’t locate evidence from past years, or because they fear the repercussions of a punishing government bureaucracy. If you have ever had to deal with Centrelink or any of its private job network partners you will be well aware of how punitive they are. Surprisingly to the government – apparently – this is producing a backlash.

Flaws and error rates

Human Services Minister, Alan Tudge, insists the automated process is not flawed and despite protests to discontinue the letters he is forging ahead with gusto. For Trudge to declare, “he wasn’t aware of anyone who was completely convinced they don’t owe money but have been given a debt notice” is either grotesque wilful ignorance or a lie in the face of a growing body of evidence otherwise.  When even “Liberal Senator Eric Abetz acknowledged there seemed to be problems with the system“, then you know it has to be disastrous.

The one aspect of this (that nobody appears to be talking about) is the sheer workload this must be creating for Centerlink. Let’s assume Alan Tudge is correct that the error rate is only 20%, which is contrary to what centerlink whistle-blowers reveal is the case.  Giving him the full benefit of the doubt, 20K letters a week represents 4K fraudulent claims a week. Which is 16K a month and 192K a year. After 1.04 million data matching discrepancy letters in a year, they will not even cover all the numbers of unemployed in this country (1.186 million), let alone all the other welfare recipients for other reasons. Alan Trudge expects the system to “generate 1.7 million compliance notices”, which by his own estimates means at least 340,000 letters in error. Of course, the Centrelink compliance officer whistle-blower that spoke to the Guardian suggests the percentages of errors are vastly larger. Given that all of this was not only easily identifiable but unavoidably self-evident prior to the system being switched on, how is any of this not fraudulent?

Tudge’s apparent ignorance (image from Peter Martin on Twitter: @1petermartin)

Voters and workers affected

At the current letter-writing rate (if they can maintain it) this will take over a year and a half to complete, although Mr Trudge thinks it will take 3 years. By then Australian Lawyers will be in a feeding frenzy of class action suits with minimally 340,000 clients with legitimate grievances with the government. This will presumably still be an ongoing issue by the next election. According to 2014 Centerlink data there were 14.459 million Social Services payments made in the March 2014 Quarter to 50% of the population – interestingly, a reduction from previous numbers. There are only 13.5 million voters – according to AEC – who voted in the last election. This is not a vote winner.  But presuming you are not expecting to win the next election, leaving this mess on another party’s door to cleanup provides a damaging handicap. The amazingly short-term memory of the public, gives the coalition an advantageous opportunity to disparage what the next government will have to do to rectify the situation.

Access issues for Centrelink online facilitates debt being levied (image from theguardian.com)

Putting aside the legal costs, consider then the other real cost in man-hours for Centerlink to resolve each erroneous issue when there are minimally 4000 cases a week. To keep on top of the “erroneous” case load – if Mr Trudge is correct – requires the equivalent of 105 Centerlink officers processing each claim within an hour in a 38 hour week. This presumes the ability for each officer to address, research, confirm and redress an error on each letter in one hour and do no other administrative work. There appears to be mounting evidence it takes much more time. Plus that does not factor in the equivalent of the 421 Centerlink officers devoting a single hour in a 38 hour week, that you’d need to process the claims – and not fall behind – which Mr Trudge believes are valid. But these figures are conservative. As I previously explained, the error rate is far larger according to the Guardian’s Centerlink whistle-blower. The backlog of work is just going to be extraordinary, if it isn’t already. No wonder it is so difficult to get through to Centerlink on the phone. It was nearly impossible to get Centerlink on the phone when there was only 20,000 debt recovery letters sent in a year but now that they are doing it every week …. ? As for other means of communication, even compliance officers are complaining they cannot access the Centerlink online system efficiently, let alone customers.

Opportunities or Overload?

In truth, even if Alan Trudge did put an end to it; Centrelink will probably still be spending thousands of man-hours dealing with the consequences of this flawed and fraudulent system. The same would be true if the Commonwealth Ombudsman began investigating Centrelink’s debt recovery system and put a stop to it – disregarding the costs in legal redress, which are sure to follow.  Nothing about this course of action makes any logical sense, except to see this as class warfare against our vulnerable and easily disparaged citizens.

Well at least, it will probably increase employment opportunities in the community at Centerlink that will giving a few folk some extra, well sought after work. But wait, isn’t there a public service full time employment freeze?

This article was originally published as ‘Debt Collection’ on Australia Awake.

Turnbull’s “Jobs and Growth” campaign inspired many in Australia to vote for whom they believed were the better economic managers of our economy. Yet in the first quarter of their second term in office, Australia is showing declining growth in the economy and similar decline in full-time jobs, reports John Haly.

The slave trade

The Hebrews and Greeks regarded work as a curse because slaves and the underclass performed “work”. Placing a positive moral value on “work” is a relatively recent invention emerging out of the Protestant Reformation. Max Weber, a German economic sociologist, wrote the book, “The Protestant Ethic and the Spirit of Capitalism“ coining the term the “Protestant work ethic“. The concept of the religious work ethic became secularized to support the rising new industrial system which required workers who would accept long hours and poor working conditions.

The unionism of the 19th century reshaped much of the makeup of “work” as we know it today. Consider ‘fair and reasonable’ wages (the 1907 Harvester Decision), better wages for women (as high as 54% of male wages by 1930), weekend penalty rates (from 1947), shorter working hours (down to 40 hrs in 1948) and four-week holidays (from 1973). Work health and safety reforms (commencing in 1984) and more consultative supervisory styles & policies (Industrial Relations Reform Act 1993) continued to transform working relationships.

In 1996 Howard introduced the Workplace Relations Act, which was later amended in 2005 (known as Work Choices). Workplace industrial relations began to change, but not necessarily for the better.  Anti-union rhetoric accelerated despite as Greg Jericho noted the lack of “strong evidence that changes to the IR system will actually improve economic growth or productivity“.

Diminishing working day

Image from tradingeconomics.com

The problem for many Australians is having access to paid work in the first place. A full day’s work (38 hr/weeks established in 1981) for a full day’s pay is a diminishing luxury in Australia. Full-time worker numbers are diminishing in preference for part-time work. The “fair day’s pay” principle suffers as wages are increasingly stagnating.

Image from tradingeconomics.com

The economy’s poor performance has been reflected in the September Quarter GDP’s figures, contracting by .5%. Australia has not experienced a contraction in GDP that severe since the GFC of 2008. This result was predictable, despite the Treasurer’s rhetoric talking up the economy.  While there are a number of factors that affect failing economies, our poor employment record is one, as Victoria University Senior Research Fellow Janine Dixon said, “Fixing unemployment would boost production, incomes and living standards.” Into this environment came the Coalition mantra proclaiming they were the party of “Jobs and Growth” that we voted for at the beginning of this contracted quarter.

The measures of unemployment

So, are we putting our increasing army of eager workers, to good use to recharge our vitiated economy? The International Business Times claimed misleadingly, “From 5.7 percent in July, Australia’s unemployment rate further went down to 5.6 percent in August. It is the lowest joblessness rate since the Coalition government came to power in September 2013”. While some conservatives may claim we were back on track, it does not stand up to scrutiny. The workforce size when the LNP took power was smaller and of course percentages are relative to that size. Using percentages hides real numbers. These are:

• ABS’s 5.6% = 697,100 people unemployed in Sept 2013 with workforce of 12,343,000
• ABS’s 5.6% = 705,100 people unemployed in Sept 2016 with workforce of 12,652,000

In term of actual numbers unemployed 5.6% in 2013, is 8000 less than 5.6% in 2016.

Image from bloomberg.com

For the Australians that can acquire jobs, the makeup of that employment has changed. In September of 2013 full-time employment was increasing at a greater rate than part-time employment but this has been reversed. A trend, which has not escaped international attention. As Alan Austin has pointed out in November 2016, “Over the last three years, there has been a significant shift from full-time to part-time jobs“.

In order to keep this critique relevant to the GDP downturn the statistics herein are relevant to the September quarter unless otherwise stated. (October’s ABS stats for unemployment were the same and November’s worse).

September end of quarter stats

Image from lmip.gov.au

The Australia wide Dept of Employment IVI index for job vacancies for September was 161.5K. This was down from 163.5K in August. Ratio of vacancies to unemployed was 1:4.4. However ABS’s standard for measuring unemployment hides thousands of unemployed people as I’ve explained in a previous article. The more accurate Roy Morgan’s unemployed statistic is 1.101 million or 8.5%. The ratio is then 1:6.8! If you add their underemployment numbers, you reach 2.103 million or 16.2% and the ratio becomes 1:13.

How then do we consider the Australia residents, who are not significantly measured by ABS as part of our workforce because of the 12/16 month rule? For example, foreign citizens with reciprocal work rights (i.e. Canadian, British, New Zealanders and etc). On October 31, 2016, there were 1,472,640 potential temporary foreign workers in Australia, 660,000 of which New Zealanders, 486,700 of which were students. Then there is the much maligned 457 visas holders in Australia, which the Dept of Immigration September Statistics number at 172,178. (Primary & secondary applicants).

What else should be accounted for? Available vacancies were examined in a report by Anglicare’s Jobs Availability Snapshot. Leon Moulden reported on the nature of job vacancies showing that only 13.1% were for low skilled jobs. Applying the same maths Leon did to the vacancies available, this would represent only 21,000 vacancies Australia-wide are applicable to people without significant skill levels and education. The ACSF from the Board of Studies in NSW scores literacy and numeracy into 5 levels. The program for the International Assessment of Adult Competencies shows that 60% of people not in the labour force have competencies of less than Level 3. While people “not in the labour force” is a wider net than the unemployed, 60% of Roy Morgan’s evaluation of 1.101 million unemployed people is 660,000. While this is only a rough estimate with a significant error variant, 660K people competing for only 21K vacancies with low skill entry is a significant barrier to entry. Now to absorb any possible margin of error, I have not factored in under-employed and foreign workers.

Enough with the numbers!

Let’s now depart from the maths and discuss the sociological issues that prevent people from finding work. Some media love to amplify the perception that everyone who is unemployed is a dole bludger, or the latest putdown acronym, NEETS. It’s their predominant strategy to divide welfare from the working class without a single consideration of any other mitigating factors, such as:

• location suitability (interstate travel, home locality, & costs/inconvenience of changing residence),
• employer discrimination, (bigotry, racism & misogyny),
• accessibility limitations, (limits of public transport, car, bus, train, disability ramps, etc),
• limits of literacy, skill, experience, qualifications & education levels,
• competition for jobs, (705K [smaller ABS nos. only] people writing 20 letters a month for 161.5K jobs = an average 87 applications a month per vacancy),
• financial limitations (For many surviving off the dole puts you below the poverty line),
• financial burdens (family, mortgage verses poor wage levels),
• injury, health & pre-existing illness or disability issues,
• occupational risks inherent in the job, (i.e. firemen, riggers)
• your status as the principal carer of a child, (i.e. single parents or guardians)
• security clearance issues (i.e. Defence Force, ASIO, child safety, commercial sensitivities),
• illegal under award payment, shockingly poor wages or condition by employers.

In summary, there are not enough jobs and the majority of available jobs are only accessible to highly skilled, mobile, and versatile workers.

Back to the first principles – slavery?

This picture isn’t yet complete. The Australian workplace for low skilled work is notorious for underpayment of wages (see 7-Eleven convenience stores, food distributors, restaurants and cafes). These are just the ones we hear about when addressed in court. Consider also those where actions have not been taken, such as the Woolongong student’s vent on social media about employers paying far below award wages. But the apologists might cry, at least they are receiving some money!  If you’re still of that view, then you didn’t read the last link to the concluding line which said, “Not only are employers looking for free labour, young people are putting themselves forward for unpaid work trials in the desperate hope they lead to a job“. So what has been our government’s response? An institutionalization of the PaTH to slavery in a government underfunded internship program which I have criticised previously.

Christmas hopes

It is nearly Christmas, and we have just had the largest fall in our GDP since December 2008. What budgetary measures can our Treasurer possibly come up with to stimulate our economy and it’s employment to save us from the official possibility of a recession.  The next quarter ends on the 31st of this month. When 2.9903 million live below the poverty line, what real chances do people have to find a decent job with a decent wage, in the new year?

About the author: John Haly is a freelancer writer and multimedia specialist. A beneficiary of a more egalitarian and tolerant political landscape in which he grew up, his observations of the changing harsher political posturing have prompted him to write articles on social justice and political issues.

Educated initially with a Bachelor of  Business, he followed these later with Diplomas in multimedia and graphic design as well as film studies at the now defunct Metro Screen. When not writing, he manages a freelance business, “Halyucinations Studios” in Sydney, doing work for clients in photograph, video production, design, IT support and web development and management. He is also the secretary of the film collaborative, NAFA, and a founding member of the Australia Arts Party.

Formerly a long time IT contractor for commercial banks (including the Reserve Bank), mining, transport, computer companies, government, university and a number of outsourcing firms, his introduction to the media was in two separate project management roles for the ABC. This developed an awareness of the need for advocacy for public broadcasting as well as providing a background in a diverse range of commercial and public service organisations.

A fifth generation Australian born son of an English teacher and an AICD Gold Medal Award winning  businessman – whose contributions to the finance sector were recognised with an Order of Australia. John has lived and worked here and overseas, although mainly around Australia and lately in Sydney, NSW.

You can follow John on twitter @halyucinations or on his blog at http://auswakeup.info/.

Australia’s last recession was 25 years ago in 1991. As 2016 finishes, the previous quarter’s figures suggest that this 25 years of good fortune could be at an end, reports John Haly.

Australia’s GDP for the September quarter had a demonstrated contraction. Not a surprise when you consider a full range of economic indicators for the Abbott/Turnbull Government. The September quarter revealed a .5% shrinkage in our GDP, not seen since the Queensland floods affected the March 2011 quarter. Prior to that the last mitigating circumstance for a contraction had been the Global Financial Crisis. This time there is no clear alibi, except the coalitions inadequate financial management demonstrated by the low growth figures in each of the last year’s quarters. In June 2015 quarter it was our accounting standards that defer payment recordings that recognised a 41.5% jump in government defence spending that secured a tiny growth rate. There was no defence spending finalised to save us in September 2016.

Coalition excuses

The Coalition team were quick to allay fears of recession, as was the media. The Treasurer blamed the deterioration on the lack of opportunity to provide tax cuts for corporations. The same corporations that by in large provide little to no tax revenue to our country’s bounty and often relocate locally generated profits, overseas.

Construction failures

The largest contributor to the fall in GDP growth according to the Australian National Accounts was the reduced output of the construction industry. Construction work had continued to tumble for the 3rd consecutive quarter taking its biggest fall of 4.9% in September’s quarter. Some are blaming poor weather (i.e. rainfall) for a fall in building activity. Aside from the fact that we are now in the monsoon wet season meaning things will get worse, is the industry suggesting “construction” doesn’t make allowances for rain? To be fair, the Bureau of Meteorology had been reporting higher rainfalls than normal for July thru September. (You need to read the PDFs for each monthly weather review in the last link). Interestingly, it has also reported a longer term decline of rainfall of around 11 per cent since the mid-1990s in the April–October in the continental southeast and 19% in the southwest of Australia. Forgive the pun, but does rainfall as an excuse, hold water? Might there be other factors in the construction downfall?

Image from http://www.tradingeconomics.com/australia

Rising Chinese investments

An August News article showed foreign investment approvals have shown a sharp rises in Chinese nationals particularly in the last few years. The 2015 Chinese investment approvals segment almost exceeding all foreign investment for the previous year. Now the previous linked News article suggested the tightening of bank lending was unlikely to adversely affect Chinese enthusiasm for Australian real estate. But is this true?  Concerns about Chinese investors laundering money in the Australian real estate market was exposed by the Four Corners program “The Great Wall of Money” in late 2015. Three significant events occurred in the period after this program went to air.

1. Despite much procrastination because of the economic risks to the banking system, the prudential regulator of banks, APRA began to enforce some of their own rules on high risk lending.
2. Australian Banks uncovered evidence of numerous and sophisticated fraudulent income statements made by Chinese borrowers. To mitigate risks they have begun to restrict lending to offshore investors.
3. The Chinese Government began cracking down on Money laundering corruption.

Three consequences have been reported in the media.

1. Robert Gottliebsen reported in August that “The mass of Chinese property buyers who snapped up Australian apartments “off the plan” on the basis of a 10 per cent deposit have started to walk away from their agreements in Sydney”. Melbourne has larger volumes of Chinese buyers.
2. To secure sufficient financial collateral and because banks consider development projects high risk ventures, developers depend of being able to provide evidence to banks of “off-the-plan” purchases of apartments.
3. Risk avoidance by the banks is resulting in restricting or pulling finance on the Chinese markets. This means construction become nonviable and added to buyer pull out, it may likely be the greater cause of any given developer may ceasing or stalling construction.

Image from http://www.tradingeconomics.com/australia/

While not wanting to “rain” on anyone’s parade, a more likely reason for a drop in construction might be the exit – of what was last year a huge influx of Chinese Buyers. In fact, given the huge influx of Chinese buyers in the market in 2015, it could be hypothesised that Chinese buyers were keeping our economy afloat.

Image from news.com.au

So what hope is there left in the last month of this quarter for us not to discover some time in February that we are in a recession?  Because two depressed GDP terms is an official recession and we have less than one month to go of the 2nd term.

• Manufacturing? – Ford is gone, Holden
 fired-up the final V6 motor at its Port
Melbourne plant on the 29th of November and Toyota is in palliative care expecting to pass away next year.
• Renewable energy market? – The government is slashing support for that industry
• Mining? – Mining investment fell for the twelfth consecutive quarter and the seasonally adjusted estimate fell 0.8%
• Exports? – Net Exports of goods fell 0.3% which is a bit surprising given how cheap our dollar is.
• Retail? – This is the first decline in over 3 years as the seasonally adjusted estimate fell 0.8% so perhaps that is just a glitch.
• Real estate industry services? – which fell by 2.4% which is no surprise given the continued unaffordability of the housing market.

Industries such as education, health, power, hospitality, transport, professional and scientific services etc contributed virtually nothing. So where are our major economic booms?

• Information Media & Telecommunications? – rose 1.6% driven by rises in telecommunications and internet services, so be thankful for Youtube, iView, Netflix and Facebook but how much can we rely on this given our lack of an innovative and internationally competitive NBN.
• Agriculture, forestry and fishing?  – driven by rises in grains, cotton and livestock production it had a 7.5% increase. One of the larger beneficiaries of the TPP was the agricultural industry, its prospective dissolution by Donald Trump does not provide hope for the future.
• Hotels, Cafes and Restaurants? – Up by 2.2%, as the cafe dwelling, latte-sipping hipster in inner city cultures put their money up to keep the economy going. Though given how disparaging the government are to this community, it would not be wise to tell them to stay home.
• Insurance and other financial services? – Up by 1.3% as the insurance and finance salesmen of the country are proving their worth for their company’s bonuses.

What (or who) can rescue us …

Unless the government can quickly pay off a huge defence “lay-by” as they did last year, it’s in your hands people. Our consistently strong industries have been Retail and Services Industries driven by household expenditures which have been traditionally strong areas of our economy. It’s Christmas, the retail and services industry awaits your patronage, if you still have a job that pays a decent wage. You have only weeks left to buy us out of a recession. Buy up big for your kids, travel, eat out and stay in a nice motel. God help Australia, but is our last hope to avoid recession, “Santa Claus“?

About the author: John Haly is a freelancer writer and multimedia specialist. A beneficiary of a more egalitarian and tolerant political landscape in which he grew up, his observations of the changing harsher political posturing have prompted him to write articles on social justice and political issues.

Educated initially with a Bachelor of  Business, he followed these later with Diplomas in multimedia and graphic design as well as film studies at the now defunct Metro Screen. When not writing, he manages a freelance business, “Halyucinations Studios” in Sydney, doing work for clients in photograph, video production, design, IT support and web development and management. He is also the secretary of the film collaborative, NAFA, and a founding member of the Australia Arts Party.

Formerly a long time IT contractor for commercial banks (including the Reserve Bank), mining, transport, computer companies, government, university and a number of outsourcing firms, his introduction to the media was in two separate project management roles for the ABC. This developed an awareness of the need for advocacy for public broadcasting as well as providing a background in a diverse range of commercial and public service organisations.

A fifth generation Australian born son of an English teacher and an AICD Gold Medal Award winning  businessman – whose contributions to the finance sector were recognised with an Order of Australia. John has lived and worked here and overseas, although mainly around Australia and lately in Sydney, NSW.

You can follow John on twitter @halyucinations or on his blog at http://auswakeup.info/.