(Due to the fluidity of rapidly changing times, the areas covered in this article might be overtaken by events).

Even though Karl Marx (1818 – 1883) spawned an abhorrent ideology, as a political scientist he actually had some insights. One such political insight of Marx’s was his conceptualization of ‘Bonapartism’ which referred to rulers (specifically the great Napoleon I and his brilliant nephew, Napoleon III) who were not beholden to a particular class. In contemporary politics, ‘Bonapartism’- or *neo-Bonapartism- can refer to politicians or national leaders who are not beholden to a particular political faction or vested interest so that they can serve a genuine national interest.

(*The Cuban statesman Fulgencio Batista (1901 to 1973) was an example par excellence of a neo-Bonapartist leader).

Sir Robert Menzies’s second prime ministership (1949 to 1966) was a vivid example in the Australian context of a national leader who was not beholden to vested power interests. Having founded the Liberal Party in December 1944, he then encouraged the operation of a rank and file branch-based political party. Sir Robert Menzies consequently developed an effective power base which made it practically impossible for big business to make him adhere to a particular agenda. By this prime minister also maintaining a close ear to everyday mainstream concerns, he was able to run a government which served the genuine national interest.

If Tony Abbott is to be a prime minister in the Menzies mould, then he will need to be a neo-Bonapartist. Abbott’s political life suggests that he could go either way: i.e. be an instrument of vested interests or be a neo-Bonapartist. As a university student political activist in the 1970s at Sydney University, Abbott was a political maverick that he possibly was a neo-Bonapartist. Tony Abbott was a member of Sydney University’s Democratic Club which was effectively the student wing of B.A. Santamaria’s National Civic Council (NCC).

The NCC, which Santamaria founded in early 1957 as a successor lay organization to the Catholic Social Studies Movement (which had been established in 1941), lost its sense of purpose following the purge of its union wing in 1982. By separating from his union base of support, Santamaria deprived himself of a means of remaining relevant to Australian politics. Santamaria would justify his separation from his former union supporters on the basis that Australian unionism was of receding relevance due to steeply falling union membership.

Santamaria’s perspective concerning the declining union membership was a self-fulfilling prophecy. A key reason for the previous strength of Australian trade unionism was the effectiveness of the Federated Clerks Union (FCU). The FCU was astutely led by John Maynes who, following the Evatt Purge of the Australian Labor Party (ALP) in 1955 became the second most important figure within the NCC after Santamaria. The FCU under Mayne’s’ leadership effectively serviced its members to help ensure that swathes of white collar employees across Australia were unionized.

The FCU vitally contributed to Australian union effectiveness because this large industry based union paradoxically helped underwrite a swag of smaller craft based unions such as the Australian Manufacturing Grocer’s Union. These craft based unions were effective because they utilized the institutional arbitral supports of Australia’s industrial relations system. The Socialist Left’s (SL) of the ALP’s consolidation of control of the FCU under the leadership of Lindsay Tanner in 1991 led to the subsequent rapid decline of this union as it eventually amalgamated into industrial irrelevance as a remnant component of the Australian Services Union (ASU).

The fall of the FCU deprived too many smaller craft based unions of the capacity to withstand the Australian Council of Trade Unions’ (ACTU) amalgamation push which led to the virtual disappearance of small craft based unions by the end of the 1990s. Commensurate with the onset of union amalgamation was de-unionization of membership as former members too often refused to join new industry based unions which they felt did not adequately represent their interests as craft based unions had. Consequently, union membership fell from fifty-one percent of the Australian workforce in 1976 to its current rate of approximately eighteen percent!

The SL could not have eventually won control of the FCU had Santamaria not initiated his 1982 purge against the NCC’s union wing when John Maynes’ had to fight against the successful ALP Left campaign to take over the FCU’s Queensland branch in union elections that year. The loss of the Queensland branch of the FCU provided Tanner with the base to win the assistant secretaryship in 1986 of the Victorian FCU, then the secretaryship of that branch in 1988 and consolidate his overall control of the Clerks Union in 1991. This occurred because elements within the FCU’s incumbent leadership foolishly agreed to a power sharing deal with the SL which Maynes eventually went against.

The FCU president (Maynes) supported the moderate ticket which then ran in 1991 but was narrowly defeated due to division within the branch’s then leadership. While it is true that the division within the FCU led to Tanner gaining control of that union, it should be pointed out that its moderate and democratic forces had been previously and unexpectedly weakened by the 1982 Santamaria Purge. As Santamaria undertook his purge in 1982, a general meeting of ninety ‘Grouper’ (i.e. moderate and democratic) trade unionists met and elected a five man delegation to go and meet him to ascertain whether he was actually cutting off from them.

The NCC President in 1982 refused to meet with the five man delegation as a group but agreed to meet with its members on an individual basis. One member of this group who took up Santamaria’s offer was provided with the ‘explanation’ by Santamaria that he had made up his mind to go his own way. The delegation on its return informed the union meeting that Santamaria would not meet with them as a group.

This information conveyed that Santamaria had for all intents and purposes severed his links with his former union base. Many of those at the meeting were personally devastated by this news because some of them had often foregone promotion in their jobs or advancement in their careers to dedicate themselves to supporting Santamaria’s ‘Movement’ because they had once been inspired by him. Nevertheless, soon-to-be sacked employees of the NCC’s industrial wing had the locks changed on their doors as they were shut out of their offices and their pay cut off. Writs were also taken out by Santamaria so former NCC employees could not talk to the press about what had happened to them concerning their dismissals.

The essential reason that Santamaria purged his union wing was so that he could gain control of funds that had been donated to the NCC for industrial campaigns. These funds were invested so that the NCC could draw on a lucrative trust fund to financially underwrite its continuing operations which were focussed on social issues such as family policies. The policy positions by the 1990s which Santamaria espoused were essentially integralist with regard to Catholics becoming insular and social credit in connection to economic policy.

That is not to say that Santamaria did not still have insights into Australian politics, social affairs and international relations. However, these insights were the exception to the rule as Santamaria was often regarded by those who bothered to still take notice of him as more of a polemicist rather than a credible social commentator. Had Santamaria semi-retired by stepping down in 1982 as NCC president in favour of Gerald Mercer or even the late and great Brian Harradine, who was than an independent federal senator for Tasmania to head a newly established Christian Democracy think tank, he paradoxically might have had more of an impact on Australian politics.

Vale The Silver Fox: Brian Harradine (1935 to 2014)

With regard to Brian Harradine, although he was relatively famous as a Tasmanian senator between 1975 and 2005, he was actually born (1935) and raised in Quorn, South Australia. Having worked for and being a trade unionist in the Australian Railways Union and in the engineering section of the Post Masters General, Brian Harradine moved to Tasmania in 1959 at the behest of B.A. Santamaria to be a union organiser for the FCU. Belonging to the then major moderate union in that island state, Brian Harradine was at the forefront in courageously fighting against the hard left within the Tasmanian union movement.

Brian Harradine’s importance to moderate trade unionism in Tasmania was such that he was elected as the state secretary of the Trades and Labour Council in 1964. He served with distinction in that position until he took up a senate seat in 1976. In the meantime Brian Harradine also served on the state and federal executives of the ALP. Indeed, Gough Whitlam’s support for Harradine not only being on the ALP National Executive but actually been a Labor Party member led to his almost being deposed as ALP federal leader in 1968 by Dr. Jim Cairns. It is thought that because of the narrowness of Whitlam’s victory margin (six votes) that from that point on in 1968, he lost his nerve when it came to standing up to the left.

In the dying days of the Whitlam government in 1975, after a concerted effort by the hard-left of the ALP, Brian Harradine was expelled from the ALP by its National Executive because of his political links to B.A. Santamaria. The ensuing popular uproar in Tasmania provided enough impetus for *Brian Harradine to be elected as an independent to the federal senate that year (1975). Senator Harradine was so effective senator that in 1980 he received what was then the highest popular vote for an independent senator when he was easily re-elected.

(*The precursor to Brian Harradine, was arguably the Tasmanian senator, George Cole who, between 1963 and 1965, was the only Democratic Labor Party (DLP) member of the Senate.

As a senator, Brian Harradine was a neo-Bonapartist who championed labour and human rights (encompassing his opposition to abortion and euthanasia) and was a staunch defender of state’s rights. As the years progressed in the Senate, Brian Harradine’s lack of a substantial party organisational base compounded with his declining voting base. There was a Brian Harradine Group which existed for registration purposes so that a grouped ticket could appear on the Senate ballot paper. The Brian Harradine Group also had an auxiliary network, but this declined in effectiveness as time went by.

The senator also had the support of the Tasmanian branch of the Shop Assistants Union (SDA) of which he was, for a long time, its titular president. A practical ramification of this symbolic honour being bestowed upon Senator Harradine was that the state branch of the ALP has refused to affiliate the Tasmanian SDA branch to its ranks. The Tasmanian ALP was recently (March 2014) thrashed in a state election. An important step that Tasmania’s ALP branch could undertake to facilitate its subsequent renewal would be to re-admit the Tasmanian SDA branch as an affiliate.

Brian Harradine’s loyalty to the Australian union movement was manifested at the 1982 NCC national conference when in perhaps the most powerful and poignant moment of those proceedings, he denounced the expulsion of that organisation’s union wing and literally turned his back on Santamaria by dramatically walking out of the conference. Santamaria’s expulsion from the NCC of its union wing was paradoxically helpful in that it paved the way for the so-called Grouper unions to re-affiliate to the ALP. As a consequence as the 1990s and 2000s went by, Brian Harradine was joined by other SDA parliamentarians.

Perhaps it was the entry of SDA parliamentarians in the 1990s and 2000s which negated the impetus for Brian Harradine to utilize his Tasmanian Senate seat as a platform to launch (or re-launch) a Grouper type third force with a DLP type of Senate based political party. Instead, it was Bob Brown of the Greens who, after a concerted struggle, supplanted the essentially centre-left Australian Democrats as the senator for the island state to eventually lead the way for his hard left party (the Greens) to be the third force in Australian politics.

Presently there is substantial scope for the Greens to entrench themselves as a ‘National Party of the left’ by becoming a junior coalition party to the ALP. The Greens have the capacity, with Liberal Party preferences, to entrench themselves by winning inner-city lower house seats from the ALP. There are probably hard-left elements within the SL of the ALP which would welcome such a development. These hard-left elements within the SL probably want to see the SDA forced out of the ALP. For this reason there have been moves to reduce, if not eliminate, union representation at Labor state conferences because the SDA has such a substantial amount of delegates.

The strength of the SDA at ALP conferences is somewhat of a paradox. This is because it was the left which facilitated union amalgamation in the 1990s so that craft based unions would combine into super industry unions. Although this scenario did come to pass, the irony was that the resulting de-unionisation occurred because rank and file members of the superseded craft unions did not wish to join the new industry unions. The SDA (which which is an industry union with its members having a strong identification with their trade) shrewdly utilized enterprise bargaining to recruit new members which has been entitled it to more ALP conference seats because they are allocated to unions based on their membership size.

It is therefore ironic that calls are coming from the hard-left of the SL for decreased representation to be awarded to unions at party conferences due to the substantial presence of the SDA. Introducing party ‘reforms’ which diminish a union’s institutionalized presence within the ALP will not necessarily lead to a subsequent ALP renewal. This is because innovations such as party primaries will not help the ALP. They will merely facilitate the temporary involvement of people who are not necessarily committed to the ALP beyond a one–off process.

Party renewal instead will be facilitated by having committed branch members who ensure that there is an engaged rank and file base pre-selecting quality candidates and to help carry them in ensuing elections. Committed party branches do not exist in a vacuum. Had the Australian labour movement not undertaken union amalgamation in the 1990s then there would be a critical mass of people from craft based unions who could have brought their talent and enthusiasm into the ALP to facilitate party democracy and renewal.

Instead the Labor is now confronted with the paradox of a moderate social democratic force institutionalized within it, in the form of the SDA, facing off against hard left activists who cannot abide this union. There are other moderate trade unions, such as the Australian Workers’ Union (AWU) and the Transport Workers’ Union (TWU), which are more factionally integrated within the Labor Right than the SDA. However, the overall political viability of moderate unions such as the AWU and the TWU is ultimately reliant upon the shop assistants union being insulated within the ALP.

There are other left-wing industry unions, such as the Construction Forestry Mining and Energy Union (CFMEU,) which counter- act the SDA, but their overall effectiveness is ultimately dependent upon there being a viable ALP. An effective ALP cannot exist without the SDA because this union is the lynchpin upon which political moderates can be viable within a Labor Party context. These moderates include unions and individuals who are sometimes not in full accord with the outlook of the SDA. Should the SDA and/or moderates associated with this union be forced out of the ALP then Labor will be consigned to everlasting opposition.

There may be hard left elements within the ALP who believe that a neutering of the SDA and/or SDA aligned moderates will clear the way for a hard left Labor Party to link up in coalition with the Greens by their winning lower house inner city seats. However, there is still a substantial social conservative voting base that the Labor Party could well lose too many votes to a party such as the centre-right Palmer United Party *(PUP) should it move to the hard left by spurning the SDA for an eventual coalition type arrangement with the Greens.

(*The DLP led by Victorian state secretary John Mulholland could eventually be an electoral force via its preferences crucially supporting moderates within both the ALP and the coalition parties. Should John Mulholland ever be a senator, he along with other DLP senators, would provide quality parliamentary representation the type of which would convert the Senate into a genuine house of review. This was the case when DLP senators held the balance of power in the federal upper house between 1970 and 1974 and when the Australian Democrats exercised the same role under the leadership of Senator Don Chipp in the 1980s).

Moving away from what could be, to what could have been, had Gerald Mercer or Brain Harradine become Santamaria’s successor as NCC national president in 1982, the way would have been cleared for unions which had been associated with the Movement to re-affiliate with the ALP. Crucially, under such a scenario, the FCU probably would not have been lost to the SL so that many Australian trade unions could have remained craft based. A continuingly heavily unionized Australia with strong moderate forces within the union movement would have impacted on the nation for the better. Paradoxically, Santamaria forfeited political influence in Australian politics to acquire financial security for the NCC by ensuring that funds which might have gone to previously aligned unions instead were within his control.

Social Action: The Social Apostolate Which Punched Above Its Weight

The former union wing of the NCC continued to support Gerald Mercer as the editor of the publication Social Action which he published in hard copy from the early 1980s and late 2005. *Social Action was a respected magazine which was read by both ALP and coalition MPs. The articles were based on a social Christian philosophy and often provided insight into what was happening in contemporary industrial relations because some of its contributors were trade union officials. Social Action often conveyed its analysis, such as its emphasis on the importance of the family unit, in an objective, logical and persuasive manner.

(*Senator Brian Harradine was a member of the Social Action executive, which after the loss of the FCU in 1991 to the SL did not meet).

Indeed, despite Social Action’s lack of resources, this publication often ‘punched above its weight’ with requests to republish its articles often coming from academics, who in a wider ideological context, might not have been in overall philosophical accord with Gerald Mercer. Ironically, Santamaria himself might have had more of a lasting positive impact had he been ensconced in academia where he could have propounded his ideas and philosophy.

It was therefore a mistake on the part of the late Chris Pearson to advocate in his column in The Australian in 2005 that the NCC convert into a *think tank. This is because such an operation would have continued to have had the ‘stigma’ of being a ‘Grouper’ operation which would have resulted in it being ostracized from the mainstream and its supporters continuing with the NCC orientation of insularity from the broader community. The continuing NCC remains organizationally viable despite this inclination toward integralist religious insularity because there is a substantial financial trust fund.

(*Santamaria, perhaps to adapt to his being on the political margins following the DLP’s loss of its senate seats in 1974 and the 1982 purge of the NCC’s union wing, often spoke of the importance of the ‘battle of ideas’. There were times when Santamaria’s advocacies did have an impact, such as his analysis of savings based economic policy in Japan. Because of Santamaria’s central role in ‘his’ organisation, there were questions as to whether the NCC would survive his death).

Continuing The Santamaria Tradition

The main reason that the NCC continued after Santamaria’s death in February 1998 was because of substantial investment funds. However, a person’s political legacy has to be more than the financial resources of a self-perpetuating organization.

This financial trust fund would be more effectively utilized by it helping underpin an academic institute associated with either the Australian Catholic University (ACU) or Sydney’s Campion College. Universities are similar to hospitals in that some of them can propagate a Christian ethos if they are linked to the Catholic Church. The St. Vincent’s Bioethics Centre was able to legitimately propagate a pro-life ethos because this medical equivalent of an academic institute was professionally integrated with the St. Vincent’s Hospital under the auspices of the Catholic Church.

A similar arrangement for a well-funded socio-political institute which was integrated with an established Catholic University would provide a basis for Catholic and non-Catholic undergraduates, post-graduates and academics to have input into Australian social affairs as part of a respected academic institution. In such a context, academic (or aspiring academic) researchers with different perspectives, but with a broadly common value system, could in relation to bio-ethics, economics, the humanities, industrial relations, international relations, law, political science and psychology propagate their ideas and beliefs within a respected academic context.

Academia provides a professional basis in which ideas, which are often Marxist inspired, can be advanced to have a broader impact on society. While Marxism as an ideology is very influential in many universities, there is not a Marxist University as such in Australia. By contrast, there are actually Catholic universities in Australia, such as Campion College and ACU, where a lay social apostolate could effectively operate so long as there was sufficient research funding.

Current NCC aligned organisations such as the Australian Family Association (AFA) could continue by being connected to a professionally administered academic institute, such as a possible B.A. Santamaria Institute. This type of arrangement would be more appropriate than the AFA being a part of a cadre operation (i.e. the contemporary NCC) which essentially has chiefs but not enough Indians because it is no longer connected to trade unions or an electorally viable political party.

Former Communist Party of Australia *(CPA) were more astute than Santamaria’s successors in that they have utilized the funds of their former party to establish the HUMANITY trust fund which has a representative range of left-wing activists as its trustees who strategically spend the money that was bequeathed to them. HUMANITY funds are directed to academia, left-wing social movements and probably for trade union elections. This is a strategically sound arrangement which could be bettered by those who still control the funds which underwrite the NCC by their directing funds to support a Catholic academic institute.

(*The Socialist Part of Australia (SPA), an ultra pro-Soviet breakaway party founded in 1971, later renamed itself the ‘Communist Party of Australia’ after the former CPA had closed up in the 1990s and this neo-Stalinist party still continues. There is also a pro-Beijing Communist Party Marxist-Leninist which was established in 1963 which exists in rump form).

Funding for a Catholic academic institute would allow the work of B.A Santamaria to be proactively taken up by future Australian academics in a range of fields of study, thereby keeping up with rapid changes in society without sacrificing underpinning values. A major failing of Santamaria’s was that, although he projected an image as a lateral thinker, he was more reactive and inclined toward opposing than fighting for a positive agenda despite the *social credit economic ideas he advanced. Unfortunately predominately reactive people on the conservative side of politics often fail to adapt so that their rationales become passé and in the process they lose their socio-political relevance.

(*The social credit ideas in economics which Santamaria promoted in the 1990s are now being used to discredit industry/sectoral assistance. It has often said that it is better for Prime Minister Tony Abbott to channel Peter Costello rather than B.A Santamaria when it comes to economics. The prime minister on economic policy should be a neo-Bonapartist by pragmatically applying ideas, which depending on the circumstances, are viable such as industry/sectoral assistance. Prime Minister Abbott should ‘channel’ Sir Robert Menzies and Sir John Mc Ewan. These two statesmen applied a pragmatic approach to economic policy in the 1950s and 1960s which was brilliantly successful).

Tony Abbott: The Ultra-Moderate Student Activist

In the context of 1970s university student politics, Santamaria’s re-active perspective was needed to oppose the left-wing extremism of the Australian Union of Students (AUS), which essentially served as an umbrella organization for the hard left of the nation’s university students. Therefore, for Abbott to have made it in 1977 to be elected president of the Student Representative Council of Sydney University as a member of the campus Democratic Club was no mean, feat given the student left’s galvanizing hatred of the NCC’s university wing. Indeed, although many *moderate student activists, such as Peter Costello, were to later claim credit for the eventual demise of AUS in 1984, most observers of campus affairs credit Abbott’s legacy in student politics for being primarily responsible for this eventual outcome.

(*’Moderate’ in the parlance of university campus politics in the 1970s/early 1980s encompassed student activists who were opposed to AUS).

Abbott as an anti-AUS activist was part of a coalition of student moderates encompassing the NCC student wing, ALP Right students and Liberal students. Due to AUS’s vitriolic hatred of Israel, many of the moderate activists in the respective ALP and Liberal student wings were Jewish, which created bridges between the student groups. Consequently, student politicians such as Tony Abbott and Peter Costello had links to the ALP student right that they also had the prospect of opting for future political careers as Labor parliamentarians.

Ironically, Costello in contrast to Abbott was closer to the ALP side of politics in the 1970s because he was involved in a Labor Unity (i.e. right wing) union election campaign to win control of the Shop Distributive and Allied Employees Association (SDA), which was then aligned to the NCC. University Democratic Clubs were utilized in the late 1970s to support the incumbent SDA leadership against the Labor Unity campaign. Indeed, it is probably because of this student support that the SDA’s incumbent leadership headed by Jim Maher prevailed against the Labor Right led by Barry Egan.

While Abbott was not directly involved in the struggle for the SDA, his sympathies were probably with the Maher team such that a possible orientation on his part to join the ALP was undermined. Other members of the Sydney University Democratic Club (such as Joe De Bruyn, who helped marshal support for Jim Maher in the fight for control of the SDA) went on to become senior officials in the SDA which in 1985 was re-admitted to the ALP as an affiliated union. This paradoxical development could not have occurred had Santamaria not previously betrayed his union support base by purging the NCC’s union wing in 1982.

Although *Santamaria’s purge initially gutted the NCC organisation, as previously mentioned, he consolidated control of the organization’s financial accounts which provided him with the funding base to continue an operation based around himself following the purge of previously aligned unions.

(*Santamaria disingenuously sought in 1984 to thwart the future re-affiliation of the ‘Grouper’ unions to the ALP by publicly coming out in support of their re-entry knowing that such avowed advocacy would undermine their prospects of returning to the Labor Party. The public support of the anti-totalitarian academic Dr. Frank Knopfelmacher for these unions returning to the ALP effectively undermined Santamaria’s blocking strategy).

Tony Abbott: The Rightist Writer

Because Abbott did not become ensconced in the NCC, he remained focused on fighting the good fight at the coal face of student politics. By the early 1980s, as a political veteran of the Democratic Clubs and the anti-AUS campaigns, Abbott as a journalist gained the reputation for being ‘right-wing’. As a ‘right-wing’ journalist, Abbott had personal links to both the New South Wales ALP Right and the Liberal Party.

The major proactive policy position which Abbott articulated in the 1980s which endeared him to both the ALP New South Wales Right and the Liberal Party was his passionate support for Australia’s alliance with the United States. During this period Abbott was difficult to categorize in political party terms because he was open to joining either the ALP Right or the Liberal Party. Nevertheless, Abbott was a neo-Bonapartist at this time because he was an independent political actor.

Abbott could have compromised his status as a neo-Bonapartist by becoming Dr. John Hewson’s press secretary in 1990 after the latter became federal Opposition Leader following the Liberal Party’s fourth consecutive loss in a federal election. Due to the overwhelming pro-ALP bias of the Canberra press gallery, the position of Hewson’s press secretary almost inevitably had to be filled by a journalist maverick such as Abbott.

Dr. John Hewson himself as Opposition Leader (1990 to 1994) was a maverick but he certainly was not a neo-Bonapartist. This was because Hewson was an ideological neo-liberal captive who, as such, had surrendered his scope to be an independent political actor. Today, even most dyed in the blue Liberal Party supporters, while admiring Hewson for his honesty, probably realize that had he won the 1993 federal election that the government he led would have been a disaster due to his ideological zealotry.

Press secretary Abbott probably did not however manifest himself as a neo-Bonapartist in the context of not apparently opposing or attempting to temper his boss’s policy extremism. It was probably enough of an adrenalin rush for Abbott to be press secretary to an Opposition Leader who made his avowed policies the focus of public attention instead of ALP federal government which most Australians were then probably heartily sick of.

Nevertheless, it was disturbing that Abbott was then prepared to serve in a possible government which not only had clearly enunciated its neo-liberal agenda in Fight Back! but also in Jobs Back! The latter policy sought to all but eliminate Australian trade unions and as such should have been disturbing to someone such as Abbott who had once been indirectly associated with moderate Australian trade unionism.

There was probably some sort of friction between Hewson and Abbott which was reflected by the latter’s resignation as press secretary. In keeping with the practice of neo-Bonapartists such Sir Winston Churchill and Sir Robert Menzies, Abbott decided to ‘find himself’ during the time of political wilderness by becoming the National Executive Director of Australians for Constitutional Monarchy (ACM).

Australians for Constitutional Monarchy Needs To Be A Neo-Bonapartist Organisation

Abbott’s ACM tenure is ambiguous with regard to assessing whether the current prime minister was (or is) an independent political actor (i.e. a neo-Bonapartist), a captive of vested interests or a combination of the two. From Abbott’s perspective, he probably perceived his leadership of ACM as reflective of his being a fearless conservative who would fight for a positive status-quo regardless of the onslaught of opposition. However, the ACM organisation was itself possibly subordinate to big business vested interests for which retention of Australia’s very successful system of absentee constitutional monarchy was (and is) at best an optional extra.

ACM was founded in 1992 at the possible behest of Sir Arvi Parbo of the Western Mining Corporation (WMC). He might have had a covert agenda to help facilitate a critical mass within the Liberal Party to ensure that individual employment contracts were eventually introduced. Individual employment contracts, which later took the form of Australian Workplace Agreements, AWAs- established a basis for non-unionized employment in the mining sector which could fatally undermine the application of award coverage for this vital sector of the Australian economy.

Parbo at this time had the public avowed admiration of B. A. Santamaria even though there were WMC senior executives who were supportive of the anti-union New Right. Santamaria’s capacity by this time to be an independent political actor (i.e. a neo-Bonapartist) had expired. Even though the NCC had once been integrally connected to a section of the Australian union movement and remained avowedly pro-union, Parbo in the 1990s appeared on the front cover of Santamaria’s Newsweekly magazine.

At the time of ACM’s 1992 formation, the NCC changed its position away from being open to an Australian republic to become ostensibly pro- constitutional monarchy. It was probably on Santamaria’s recommendation to Parbo that Abbott became ACM National Executive Director. In this position Abbott was the enthusiastic public face of retaining Australia’s system of constitutional monarchy. However, as ACM National Executive Director, Abbott did nothing to prevent the establishment of a national structure where only ACM directors can vote and rank and file members of Australia’s main monarchist organisation were (and still are accorded) the status of ‘supporters’ with no voting rights what so-ever.

Australia’s ‘Crowned Republic’: The Beginning of the End of Both the Monarchy and of States?

The organisational oligarchy which afflicts ACM is such that policies which its ‘supporters’ may not endorse are advocated. The prime manifestation of this has been ACM’s advocacy of what is officially called a ‘Crowned Republic’. Under this proposal, the Governor-General (whose official position could later be renamed ‘president’) will officially be recognized as Australia’s ‘Head of State’. The legal concept of Head of State is a republican one which goes back to Charles De Gaulle’s establishment of the Fifth French Republic in 1958.

There is a distinct danger for Australia that if, the ‘Crowned Republic’ constitutional model is adopted, the role of the British monarch in confirming (i.e. officially appointing) the Australian Governor-General at the instigation of the serving prime minister will be terminated. Such a constitutional scenario would see the lapse of the conventions which the British Crown brings to the Australian Constitution by the Governor-General specifically representing the British monarch. Were this to occur, executive power would be overly concentrated with the prime minister for whom the Governor-General/President would become a constitutional cipher.

Ironically, Australia adopting a so-called minimalist republic via a ‘Crowned Republic’ would be the most radical constitutional model of them all because it would facilitate a concentration of executive power. Therefore if Australia is ever lamentably to become a republic, let it be part of a referendum process in which the conventions which come from the constitutional connection to the British Crown are transparently codified.

Both genuine Australian constitutional monarchists and republicans must therefore stridently oppose any transition to a ‘Crowned Republic’. There has also been the announcement of a constitutional monarchist group in the federal parliament led by the Tasmanian Senator and Employment Relations Minister, Senator Eric Abetz. Hopefully this development will not provide impetus for the move to a ‘Crowned Republic’.

The real agenda of proponents of a ‘Crowned Republic’ within the Abbott government is to constitutionally centralize power with the Commonwealth so that states can eventually be phased out. The constitutional groundwork for achieving this objective can be facilitated by amending sections, 1, 2, 61 and 110 of the Australian Commonwealth Constitution (the Constitution).

Section 1 of the Constitution states that legislative power of the Commonwealth is vested in a federal parliament which consists of ‘the *Queen, a Senate, and a House of Representatives’. Proponents of a ‘Crowned Republic’ probably want to amend the text by substituting ‘Queen’ with ‘Governor-General’.

(*The ‘Queen’ referred to Queen Victoria who was the reigning monarch at the time (1900) of the Constitution being adopted and it was understood that this reference would encompass succeeding British monarchs).

The locus of constitutional change would be Section 2 of the Constitution which stipulates that a Governor-General is appointed by the Queen. Section 2 could be amended that ‘a Governor-General is appointed by the Queen’ to instead read that he or she is appointed by the prime minister. The statement in this section that the Governor-General represents the Queen might be retained but this would be effectively counteracted by removing the formal appointment powers from the monarch. It is also very highly probable that the Abbott government will seek to also amend this section to state that the Governor-General is Australia’s Head of State appointed by the prime minister.

Amending Section 2 so that the Governor-General becomes Australia’s Head of State would probably entail removing the text from this section which reads that the Governor-General ‘shall have and may exercise in the Commonwealth during the Queen’s pleasure, but subject to this Constitution, such powers and functions of the Queen as Her Majesty may be pleased to assign him.’ If this text is removed then the carriage of powers from the British Crown to the Governor-General which underpins Australia’s constitutional conventions (i.e. unwritten laws) will lapse. This will create the frightening scope for a concentration of executive power with the prime minister.

The scope for there to be an executive power could also be further facilitated by amending section 61 of the Constitution which currently states that ‘executive power is vested in the Queen and is exercisable by the Governor-General as the Queen’s representative, and extends to the execution and maintenance of this Constitution, and of the laws of the Commonwealth’.

Section 61 of the Constitution could be amended to instead read that executive power is vested ‘in the Governor-General as Australia’s Head of State’. There might be still reference to the Governor-General being the Queen’s representative but amendments of sections, 1, 2 and 61 of the constitution would effectively sever any constitutional connection to the British Crown that sources of constitutional power are vested in Australia’s Head of State.

One of many potentially adverse negative ramifications of amending these aforementioned sections of the Constitution by way of executive concentration of power with the *prime minister would be the emasculation of states to the point at which they are virtually abolished. Section 106 of the Australian Constitution provides that state constitutions will continue after the onset of federation ‘subject to this (i.e. federal) Constitution’. This section of the Constitution also effectively says that each state constitution can be amended by a state.

(*If section 2 of the Constitution is amended to read ‘as appointed by the prime minister’ with regard to the appointment of the Governor-General, this will not only be the first mention of this post in the Constitution of prime ministers but will help clear the way for executive power to be concentrated with whomever holds this position).

Should the constitutional connection to the British Crown be federally severed then there will be latitude for state constitutions to later be amended by state parliaments (so long as a requisite majority is reached in both houses of state parliaments) to say that the Governor of a state represents Australia’s Head of State instead of the British Crown. Such a constitutional development would effectively terminate state sovereignty so that centralist measures could subsequently be undertaken.

‘Regionalization’ could be a consequential reform package which could be undertaken if states constitutionally transfer their constitutional sovereignty to Australia’s Head of State. The process of ‘regionalization’ could be facilitated by the Abbott government proposing a constitutional amendment that local government be recognized in the Australian Constitution so that they can receive Commonwealth funding. Such a constitutional amendment is similar to the referendum proposal which the Gillard government legislated to be held on or after the 14th of September 2013. Prime Minister Kevin Rudd’s decision not to have the federal election on that date so that no constitutional referendum took place was one of the most positive of his political career.

Nevertheless, there is still the potential for the Abbott government to utilize the Gillard government’s referendum proposal to proceed. Prime Minister Abbott can present such a referendum proposal as a sensible constitutional reform while simultaneously putting other constitutional amendments facilitating a ‘Crowned Republic’ and recognition of Australia’s indigenous people. The proposals facilitating both a ‘Crowned Republic’ and the constitutional recognition of local government would be closely inter-linked.

If passed, these two constitutional amendments would establish the context that the constitutional sovereignty of Australian states lies with the Commonwealth (via the Australian Head of State) while facilitating the emergence of a new regional tier of government which would eventually take the place of Australian states. To help present these two constitutional amendments as sensible and moderate reforms, Prime Minister Abbott will advance them along with the third and laudable amendment that Australia’s indigenous people be constitutionally recognized.

A major problem which Prime Minister Abbott is probably conscious of and is overcoming in transitioning Australia to a centralist nation is that most of his Commonwealth and state parliamentary colleagues are pro-state rights. It is in this context that the advocacy by ACU Vice-Chancellor, Professor Greg Craven in The Australian (Page 10, 19th March, 2014, Capital’s Theory of Devolution) that a constitutional convention be elected similar to the one which was elected in the colonies in the 1890s which then paved the way for federation in 1901, should be seen.

Professor Craven writes that there is a need for the Australian federation to be reformed by eliminating unnecessary federal and state constitutional duplication, even though there is already existing constitutional scope to overcome such a problem. The ACU Vice-Chancellor adopts an avowedly pro-state rights stance by advocating that Commonwealth powers be ceded to the states where there is duplication. It is in this context that Professor Craven has proposed that a constitutional convention be elected to help facilitate transfer of duplicating federal functions to the state.

However, if a regionalized regime is in place in which the states have transferred their constitutional sovereignty from the Crown to an Australian Head of State, then such a constitutional convention might transfer the constitutional powers of the states to the new regional tier of government. Consequently, pro-state rights politicians in intending to support federalism by endorsing a constitutional convention might be supporting a course of action which has the opposite intended consequence.

Alternately, if such a convention is elected before an Australian Head of State has been constitutionally created, along with the granting of federal constitutional recognition of local government then such an elected assembly might facilitate these outcomes. Pro-Abbott delegates who are ostensibly pro-states rights could advocate that federal powers be transferred to local government authorities which are currently recognized in state constitutions. The net effect would be the same in that the viability of Australian states would still be fatally compromised. Such an outcome is a development which the Liberal Party founder Sir Robert Menzies would never have countenanced.

Liberals who wish to remain true to the Menzies tradition should oppose any move to undermine Australia’s practically perfect Commonwealth Constitution. To ensure that his political base not only acquiesces to overhauling the Constitution but supports this process, a strategically and tactically astute Abbott is establishing attitudinal settings so that senior Liberals and the mainstream of Australian society will support future constitutional amendments introducing an Australian Head of State and Commonwealth recognition of local government.

The unilateral manner in which the prime minister re-introduced imperial honours, albeit on too narrow a basis, created a mild degree of political controversy. This action was sufficient for Abbott to maintain his monarchist bona fides but still prepare the way to proceed on the apparently conciliatory course of action of holding a referendum to facilitate a ‘Crowned Republic’. Abbott could disingenuously claim to still be a monarchist, albeit one who recognizes that Australians want their ‘own’ Head of State.

Having an ostensibly monarchist prime minister, along with ACM supporting a ‘Crowned Republic’, would seemingly make it inevitable that constitutional amendments introducing an Australian Head of State would pass. This avowed monarchist support would also contribute to the momentum for the passage of the apparently sensible proposal to recognize local government in the Australian Constitution. To reinforce the perception that nothing radical is being foisted on the people, a referendum on the constitutional recognition of Australia’s indigenous people will be held because this would understandably have mainstream support.

Ironically, it is a republican in the person of the federal Communications Minister Malcolm Turnbull who is best positioned to save the Australian Constitution. If it were not for the emasculation of Australian states, Malcolm Turnbull might understandably support the constitutional creation of an Australian Head of State because a subsequent transition to a minimalist republic could be made. This would entail the term ‘Governor-General’ being substituted with ‘President’. Having a constitutionally recognized Head of State who is also the constitutional reference point for Australian state governors makes the ultimate transition to an Australian republic procedurally easier.

However, in the interim of Australia being a ‘Crowned Republic’, socio-political and economic power will be unfairly concentrated with a rent-seeking elite whose undemocratic power will be substantially derived from the fatal undermining of Australian states. Australian republicans who want to preserve the democratic and federal substance of the Constitution can at a later date without a ‘Crowned Republic’ have a referendum in which there can propose an amendment that a president elected by both houses of federal parliament take to the place of the crown and the Governor-General.

If the current Australian Constitution is amended to (very unfortunately) make the nation a republic, then this could be undertaken by a constitutional amendment stipulating a process where the High Court as a constitutional safeguard, interprets how Crown conventions are to be applied. Should the Commonwealth Constitution be amended by popular vote to make Australia a republic, then there would probably be bi-partisan impetus for state parliaments to amend state constitutions to sever their constitutional connection with the Crown.

Instead of having, as would occur under a Crowned Republic, a situation where the Australian Head of State is the constitutional source of power in place of the Crown, state constitutions under an Australian republic could, as their source of legitimacy, have reference to the state parliament. Under such a scenario state governors in a republican Australia could be elected by state parliaments. As such, state governors would continue on in their titular positions, with reserve powers. There could also be a constitutional amendment providing for state Supreme Courts to safeguard constitutional integrity by interpreting how former Crown Conventions were to be applied.

Genuine Australian monarchists speculating how a minimalist republic could be formulated are in an awful paradox. However, the current and probable future political dynamics are such that, without republican opposition, a Crowned Republic will become a reality which fundamentally erodes Australia’s practically perfect Constitution. If Australia is unfortunately to become a republic, let there be a process where there is a transition which safeguards the integrity of the Constitution and with it, the nation’s system of federal-state relations.

While it may be a challenging proposition for genuine Australian monarchists to appeal to minimalist republicans, it is necessity which dictates that this be the case. Unfortunately, genuine monarchists probably lack the collective organisational capacity and support base to make the case to the Australian people opposing a ‘Crowned Republic’. This is despite the probable fact that most Australians are inherently monarchist in that they love the royal family and are understandably supportive of Australia’s practically perfect Constitution.

Australia’s ‘Crowned Republic’: The Beginning of the End of the British Monarchy in the United Kingdom?

It should also be emphasised that an adoption of a ‘Crowned Republic’ in Australia ultimately threatens the existence of the British monarchy in the United Kingdom. The Australian, British-based human rights lawyer Geoffrey* Robertson has advocated that Britain have a written constitution in which the role of head of state is specifically recognized. Robertson has also advocated that Britain have an elected titular president who initially shares his or her constitutional and civic duties with a continuing co-existing British monarch.

(*Even though Robertson is a human rights lawyer he wrote an obsequious biography of the English republican, John Cooke (1608 to 1660). This man was the seventeenth century’s equivalent of an Andrei Vyshinsky (the Stalinist prosecutor in the 1930s Soviet show trials) whom a contemporary human rights lawyer such as Robertson should never defend because Cooke was the chief prosecutor in a rigged show trial with capital punishment as an inevitable outcome.

As the victim of a show trial, His Majesty, Charles I took the ethical course of action of refusing to speak in his own defence so as to deny legitimacy to a judicial sham. By conducting himself with such dignity, Charles I demonstrated the arbitrary nature of Cromwellian republican ‘justice’. The prestige with which Charles I endowed the monarchy, helped pave the way for the reinstatement of the royal institution over eleven years later in 1660.

The 2005 biography which Robertson wrote of Cooke, The Tyrannicide Brief, should instead be re-titled, The Regicide Brief).

As a clever persuader of people with regard to manipulating attitudinal settings, Robertson knows that the British public are inherently resistant toward a British republic due to their love for their royal family. By bringing in such a constitutional hybrid system Robertson, knows that republicanism by stealth can be facilitated. The shrewd Robertson has previously advocated that the Princess Royal, Princess Anne, be elected as Britain’s first president to then be a sort of co-head of state. While such a scenario is ridiculous, it is also smart politics. This is because this ‘Head of State’ strategy aims to manipulate the British people’s love for their monarchy to have an initially co-existing elected president. Once this paradigm is crossed, then it will only be a matter of time before the institution of monarchy is phased out altogether.

This hybrid strategy will not be attempted during the reign of Elizabeth II. However, there is already a tendency on the part of sections of the British media to refer to the Queen as ‘head of state’ so as to lay the ground work for a future British republic. Even though the prospect of a British republic seems ludicrous, someone such as the Labour leader Ed Miliband becoming prime minister could well see the Robertson strategy adopted.

Even though Elizabeth II’s reign has been a stupendous success, there are still potential threats to the British monarchy and to Britain’s very national viability. The referendum which is scheduled for September 2014 regarding maximum autonomy (‘devo-max’) for Scotland will, if passed, constitute the de facto termination of the nation of Great Britain. Hopefully, a majority of the Scottish electorate will appreciate that their nation’s union with Britain via the British Crown has provided them with the capacity to enjoy real political liberty and for Scotland to have national greatness as part of Great Britain rather than being a future rent-seeking Scottish republic which is overly dependent on revenue from North Sea oil.

Why Australian Monarchists Should Be Monarchist

Therefore, Australia’s retention of its constitutional system of absentee constitutional monarchy, or more to the point a refusal to adopt a ‘Crowned Republic’, could actually help safeguard Britain’s constitutional viability. For someone as Abbott who helped launch his political career as an avowed Australian constitutional monarchist, the very least he could do, would be to refuse to adopt the ‘Crowned Republic’ model. Instead, Abbott is selling out the monarchy and in so doing corroding the Australian Constitution so that a new centralized regime via ‘regionalization’ is established.

Abbott’s actions as prime minister to date seem promising in that he invited Prince Harry to Australia and also invited the Prince William and Princess Kate with their new son, Prince George, to visit in April 2014. However, the royal April visit could be tragically paving the way for a ‘Crowned Republic’ which will crucially pave the way for the abolition of Australian states.

It would be wonderful if members of the royal family regularly visited Australia and, when they did so, be allowed to engage with members of the public instead of their being shunted away as has being recent practice. Even many republicans enjoy members of the royal family visiting Australia and their doing so could help foster popular monarchist sentiment which undermines the power of a- would- be rent-seeking elite.

The prime minister inviting members of the royal family visiting Australia and safeguarding the nation’s constitutional integrity would not constitute a breach of faith with the Australian people because this has previously been Abbott’s avowed agenda. Furthermore, as Sir Robert Menzies’ long tenure as prime minister attests, national leaders who do not have concealed agendas from their people are better positioned to be politically successful than those with covert intentions.

Tony Abbott as prime minister is now powerful enough to fend off any suggestions from anyone to whom he once might have been beholden to pursue covert agendas, including a’ Crowned Republic’. Alas, Abbott is moving in the direction of establishing a ‘Crowned Republic’ because the basis upon which he first became Liberal leader in late 2009 and then undermining the Gillard government was in keeping with the agenda of ultimately centralizing power with Canberra.

Why Tony Abbott Does Not Now Need Mentoring from John Howard

A current and prominent advocate of a ‘Crowned Republic’ whom Abbott should ignore is John Howard. Indeed, it is best that the prime minister ignore the policy agendas of his former mentor (i.e. Howard) such as the phasing out of Australian states and trampling on collective employee rights. Abbott could follow on in the Menzies tradition of promoting the interests of the vulnerable in society (‘the forgotten people’) even if he is a professed admirer of John Howard. It is almost axiomatic that we admire our mentors. However, should Abbott pursue a Howard agenda, he will forfeit a capacity to uphold the Menzies tradition within the Liberal Party of fairness to all.

That the current prime minister admires Howard is not surprising because it was the then former Liberal leader’s glowing personal reference combined with the public prestige of being ACM’s public face which vitally helped Abbott win party pre-selection for the Sydney federal seat of Warringah in 1994. This pre-selection along with the establishment of ACM was reflective of a neo-liberal ideological faction being formed in the New South Wales branch of the Liberal Party.

It would be difficult to deny that factionalism within a major political party is not inherent. However, the Liberal Party until the 1980s had remained substantially free of explicit ideological based factions. The major ideological based division within the Liberal Party that developed in the early 1980s was between ‘wets’ and ‘dries’. The former were generally advocates of a mixed economy while the latter desired a receding of the state and what they perceived as an excess of union power.

The Howard-Peacock leadership rivalry of the 1980s and early 1990s, while personality based in nature, provided the basis for neo-liberal ideological formation within the Liberal Party. The West Australian branch of the Liberal Party had traditionally been the centre of an anti-union orientation and a base for the dries due to the power of big corporate mining interests. The foundation of the Melbourne based H.R. Nicholls society in 1986 reflected the emergence of an anti-union network of labour lawyers, (of which Peter Costello was then very prominent) industrial advocates and academics (such as Katherine West) which was considered integral to what became known in the 1980s as the ‘New Right’.

The support which the pro-New Right Kroger-Costello faction within the Victorian branch of the Liberal Party helped provide Howard with a power base within the home state of his then arch-rival Andrew Peacock. The Kroger-Costello faction referred to the alliance between these two relatively ‘Young Turks’ within the Victorian branch of the Liberal Party, who beginning in the 1980s, began stacking out local party branches to build a power base. Their activities frightened so many Liberal state and federal Victorian MPs that they rallied to the then state Liberal Party leader Jeff Kennett who by default, as a reaction, developed his own state based Kennett faction.

As Peter Costello grew in political stature after he was elected to federal parliament in 1990, the Kroger-Costello faction became a national political operation as the future Treasurer linked up with former associates in his student politician days who were now in parliament such as Joe Hockey. This political operation (i.e. the Kroger-Costello faction) apparently worked well up until there was a move in 2007 to depose John Howard as prime minister in favour of Peter Costello.

The then Treasurer refused to take the bait realizing that that those who wanted to depose Howard would sabotage the ensuing election campaign so that he would have the distinction of being both Australia’s longest serving treasurer and one of the shortest serving prime ministers. Having shrewdly refused to fall for this trap set by anti-state elements within the Liberal Party, Peter Costello was consequently in a position to become the Opposition Leader after the coalition inevitably lost the 2007 federal election.

Perhaps realizing that leadership of such a treacherously duplicitous party was inherently unviable, Peter Costello did not stand for Opposition Leader in 2007 and retired from parliament in late 2009. The former treasurer still had (and has) political influence within the Liberal Party via his former faction which has now effectively become a ‘Costello’ faction having parted ways with the Kroger forces. This separation was manifested in the pre-selection in early March 2014 for the Victorian state seat of Kew in Melbourne.

This pre-selection battle was between Mary Wooldridge, the Victorian Minister for Disability Services and Reform and the Stonnington mayor, Tim Smith. The former was supported by the Kennett faction and by the emergent Costello faction! This alliance was incredible considering the personal animosity which had existed between Jeff Kennett and Peter Costello. Tim Smith was supported by the Kroger faction which seems to have a sub-faction within its ranks loyal to Kevin Andrews, the federal Minister for Social Services.

Tim Smith won the pre-selection because the local Liberal Party members in Kew are free from factional control and as such, were not going to be dictated to by Premier Denis Napthine (who belongs to the Kennett faction) as to who they should pre-select. While the Kroger-Andrews faction does not have an array of stacked out seats under its factional control, this relatively new political operation does have a formidable intelligence network so that its operatives can contact key branch members who have strong local followings. These locals can in turn utilize their influence to determine pre-selections against the Kennett and Costello factions.

The Kew pre-selection offers a template by which the Kroger-Andrews faction can strike the balance between respecting local branch sensibilities and utilizing the limited numbers they have on the ground so candidates with strong local followings but without established factional muscle can win. It is via this process that a new Kroger-Andrews faction is forming in Victoria. This nascent faction is linked to the rigidly controlled and well organised New South Wales Right Liberal Party faction. The New South Wales faction is aligned to the entrenched conservative faction in *South Australia and to other similar hard right state based factions across Australia.

(*The federal Education Minister Christopher Pyne is a leading member of the rival moderate faction in South Australia. Nevertheless this federal minister is apparently supportive of the emerging Victorian based Kroger-Andrews faction).

The major advantage that this emerging national right faction within the Liberal Party has is the support of Prime Minister Tony Abbott. Indeed, it was the nebulous but well-coordinated support of this factional network which enabled Tony Abbott to depose Malcolm Turnbull as Liberal leader in late 2009. Tony Abbott as prime minister seems to be supporting the emergence of a national Right Liberal Party faction.

A distinguishing trait of the National Right faction will be its crucial support for the Abbott government’s ‘regionalization’ policy. The senior strategists of this emerging faction want ‘regionalization’ so that they can gain patronage access from controlling a new regional tier of government. The desire for this patronage control is the factor which drives the ruthless determination of factions within both the Liberal and Labor parties to facilitate ‘regionalization’.

It is in this context of ruthlessly determined factional adversaries that state based Liberal Party factions which will not belong to a National Right Liberal Party faction should gain a sense of ideological coherence by specifically supporting state rights and opposing the onset of ‘regionalization’. The Kennett and Costello factions in Victoria cannot form an alliance (or a state based faction) merely on the basis that ‘my enemy’s enemy is my friend’.

A more substantial basis for counter-factional formation is required for those Liberals who will not belong to a National Right faction. Supporting state rights will not only help endow a principled dimension to belonging to a faction but also provide the basis for positive policy formation to occur by defending Australian federalism. Fighting for states rights could also help state based Liberal Party factions to attract talented and popular party branch members to their orbit before they are recruited in a future and formalized National Right faction.

Such a nationwide based Liberal faction was never established by John Howard. It was therefore ironic that impetus toward such factional formation was precipitated by undermining this prime minister in 2007 and engineering Tony Abbott becoming Opposition Leader in late 2009. The former prime minister (Howard) was however the first senior Liberal to consciously seek to formally factionalize his party.

Howard’s political position was also reinforced in New South Wales by endowing a neo-liberal ideological dimension to the personalised orientation toward him in his home state among Liberal Party members such that a formal New South Wales Liberal Party Right faction was later formally constituted. Indeed, a secret to Howard’s eventual victory over * Peacock was that he articulated a philosophy and an ideology which his rival seemed bereft of.

(*Peacock did declare himself to be ‘damp’, i.e. socially ‘wet ‘but ideologically ‘dry’ when it came to economic and industrial issues. This ideological synthesis was fatal to Peacock because he conceded too much policy ground to Howard. Had Peacock more effectively utilized the Victorian parliamentary front bencher Ian Mc Phee as a philosophical anchor he might have possessed the capacity to have been Howard’s ideological and political match).

The Howard Loyalist: Tony Abbott’s Early Parliamentary Career

It was almost inevitable that, due to his owing Howard the favour for his pre-selection and the ideological factional formation which was underway within the New South Wales branch of the Liberal Party, that Abbott would be a Howard loyalist upon entering parliament in 1994. In this early period of Abbott’s parliamentary career he demonstrated himself to be a Howard supporter by declaring that John Howard was the best prime minister that Australia never had. It was therefore auspicious for Abbott when Howard returned to the Liberal leadership in January 1995 and then won the March 1996 federal election to become prime minister.

Another Howard loyalist during this transition period was Peter Costello who was indispensible in engineering John Howard’s return as leader in early 1995 and then loyally serving as his deputy to vitally assist the Liberals win the 1996 federal election. This Victorian politician probably was not as emotionally close to Howard as possibly Abbott was. However, Costello probably saw in Howard the opportunity for the Liberal Party to successfully maintain a neo-liberal ideological orientation so that his party could eventually regain office after the electorate had apparently repudiated economic rationalism by denying Dr. Hewson high office in 1993.

However, Costello was to later find that Howard would not reciprocate loyalty by his stepping down after serving two terms as prime minister as they had agreed in late 1994 as part of their succession plan. Abbott was to have no such disappointments in Howard as he was too junior to then be a leadership contender. In the 1996 to 2007 period of federal Liberal Party rule, Abbott loyally and competently served in the Howard government successively as a parliamentary secretary, a minister and then as a senior cabinet minister. During this time Abbott was a neo-Bonapartist in the context that he was unswervingly loyal to Howard as prime minister regardless of the political price.

Abbott as Employment and Workplace Relations Minister between 2001 and 2003 in policy terms was not however a neo-Bonapartist. As a former moderate student leader who had supported an organisation (the NCC) which then had strong links to part of Australia’s moderate union movement, Abbott should have known better than to have continued on from his predecessor Peter Reith by violating the convention concerning the appointments of bench members of the Australian Industrial Relations Commission (the Commission). It had been a long-standing practice that federal governments, whether they be ALP or coalition that half the appointments to the Commission be alternatively from the business sector and the other half from the union movement.

The Howard government’s discarding of the above industrial convention constituted a fundamental breach of accepted industrial relations practice. In Abbott’s defence, it could be said that the die had already been cast by Reith but the former took no steps to be a neo-Bonapartist by remedying this breach of faith. It cannot be accurately said that Abbott was too ignorant or narrow-minded regarding his knowledge of union affairs that he could not have taken remedial action.

As Employment and Workplace Relations Minister, Abbott demonstrated that he was knowledgeable about contemporary union affairs by publicly referring to the organising union model (the organising model). The organising model is an approach which seeks to facilitate union renewal by activating rank and file union support at a workplace level. Unfortunately, Abbott derided the organising model as a means of treating rank and file union members as ‘sheep’ which is actually the very opposite objective of the model.

Perhaps it was too much for any Workplace Relations Minister belonging to the Liberal Party to demonstrate any empathy for trade unions or the employment rights of wage earning Australians. If Abbott forewent any chance to be a neo-Bonapartist in industrial relations, his legacy as Health Minister between 2003 and 2007 was ambiguous.

‘Weak and Sneaky’ or Strategically Brilliant? The Political Duplicity of John Howard

As Health Minister, it is also difficult to ascertain whether Abbott was a neo-Bonapartist. The main controversy regarding Abbott’s tenure as Health Minister was a speech he gave in 2006 to the Adelaide University Democratic Club in which he publicly decried the high rate of abortions in Australia. This speech precipitated an outcry amongst advocates of legal abortion to the effect that an avowedly pro-life health minister should not have responsibility for deciding whether the RU-486 ‘morning-after’ pill should become legally available in Australia.

Prime Minister John Howard decided to give federal coalition MPs a conscience vote on whether or not to deprive Abbott of the prerogative to decide whether RU- 486 would be available. Although Howard is avowedly pro-life, he probably knew that by allowing coalition MPs a conscience vote that the numbers overall in the parliament would be in favour of taking responsibility away from Abbott regarding the legal availability of this drug.

Even though Howard voted for Abbott retaining responsibility for deciding RU- 486’s availability, a few political insiders suspected that the prime minister did not really mind being on the losing side of the parliamentary vote. The question regarding Abbott’s real stance in this matter is uncertain- was he also being duplicitous in ‘losing’ a vote because he also covertly wanted to see the introduction of RU-486?

The issue of duplicity is one which should but won’t dog Howard because he was usually such a master of it. Paul Keating as prime minister (1991 to 1996) referred to this duplicity by describing Howard as ‘weak and sneaky’. The Australian public seemed reconciled to Howard’s duplicity because they apparently accepted his categorization of ‘core’ and ‘non-core’ promises after he reneged in 1997 on his solemn 1996 election vow that he would never introduce a Goods and Services Tax (GST).

Ironically, if not a form of poetic justice for Howard, it would be duplicity by his senior parliamentary colleagues which brought him down in 2007. In that year, senior Liberal parliamentarians moved to depose Howard as prime minister to put Costello in his place so that the latter would lead his party to defeat in the ensuing election due to internal party sabotage. This strategy (which has been analysed in other Social Action Australia articles) was aimed at ensuring the election of the ALP’s Kevin Rudd as prime minister so that his transitional government would fulfil the function of dismembering Australian states as part of the process of ‘regionalization’ (sic).

The then prime minister was himself vitriolically anti-states as were the so-called pro-Howard Right Liberal Party state based factions. The ‘Howardian’ Right was however prepared to ditch its leader in 2007 so that Liberal Party interests in the oncoming ‘regionalization’ (sic) process would be represented by the New South Wales Liberal Party branch which was pre-destined to win a mega-landslide in the March 2011 state election.

The political intrigues within the federal coalition leading up to the 2007 federal election were labyrinthine but the coherent objective of the Liberal Party plotters was to dispense with both Howard and Costello. The latter was too clever to fall for the trap that had been set for him to briefly replace Howard as prime minister in 2007 and shortly thereafter then lose the ensuing election due to internal party sabotage. Consequently, Costello made a last minute deal with Howard that he would not challenge the then prime minister in return for his publicly promising that he would step down during the next parliamentary term should the Liberals win the 2007 federal election.

During this period of political duplicity, Abbott was a neo-Bonapartist in that he conveyed that he was not a captive to external interests and party intrigues by his remaining loyal to Howard. Cynics could argue that Abbott was loyal by default because the Howard plotters never approached him. If this was the case, it then was still a tribute to Abbott because it indicated that his reputation was such that he was then not regarded as an opportunist.

2007 to 2009:Tony Abbott’s ‘Wilderness Years’

The defeat of the Howard government in the November 2007 federal election seemed to consign Abbott to the political wilderness in terms of his ever leading the Liberal Party. As the perceived philosophical heir to the defeated Howard, Abbott forwent the opportunity to stand for Liberal leader in the post 2007 election ballot among Liberal Party federal MPs. Costello’s success in avoiding a politically fatal trap did not lead to continuing sanguineness on his part because he refused to stand for the leadership of a party which was then his for the taking. This refusal on Costello’s part to stand was probably due to anti-Howard plotters convincing him not to stand by exploiting his long-standing anxieties about assuming national leadership of the Liberal Party.

With Costello out of the race, the anti-Howard plotters successfully rallied to support the former defence minister, Dr. Brendan Nelson being elected as the new federal Opposition Leader. Even with Costello and Abbott out of leadership contention, Nelson’s December 2007 election as Opposition Leader was still an upset because he defeated the prominent and popular former Environment Minister, Malcolm Turnbull.

Dr. Nelson’s election victory was due to the anti-Howard plotters gaining a leader who not so much there to take the Liberals to victory at the next federal election but rather to keep Prime Minister Kevin Rudd on the straight and narrow with regard to implementing an anti-states agenda. But with poll ratings as abysmal as Nelson’s and given Costello’s continued reluctance to stand for the leadership, Malcolm Turnbull was elected unopposed as Opposition Leader in September 2008.

Malcolm Turnbull might have been safe in his position as Opposition Leader had he been prepared to adopt an anti-states position. The anti-Howard plotters of 2007 wanted an anti-states federal Opposition Leader who would help establish the settings for Prime Minister Kevin Rudd to actively implement ‘regionalization’.

Turnbull’s staunch advocacy of states ‘rights, therefore consequently created an acute crisis for the former anti-Howard plotters. It was in this context that they were prepared to turn to anyone with sufficient skill to implement their agenda. Their man was to be found in the person of Tony Abbott who seemed to vindicate the maxim that: ‘Good luck is where preparation meets opportunity’.

Abbott as a political leader seemed to encompass the above cited saying. During his time in the political wilderness between 2007 and late 2009, Abbott published his book Battlelines which essentially advocated the dismemberment of Australian states. In this regard, Abbott was a loyal Howardian in terms of his avowed public policy. Because the now anti-Turnbull plotters had themselves once been Howard loyalists, they were paradoxically comfortable to have their party led by someone who had previously remained loyal to Howard to the end.

In Abbott, the now anti-Turnbull plotters had found someone who was prepared to ‘throw’ (i.e. lose) an election in 2010 if it meant that a re-elected Kevin Rudd implemented both an anti-states’ regionalization’ agenda and a super-profits taxation regime to help establish a *rentier state. Abbott was expected by the anti-Turnbull plotters to utilize his political skills to ensure that, if he ‘threw’ the 2010 federal election, he still ensured that the Liberals won the next federal election.

(*A rentier state and rent-seeking have both been defined and analysed in other Social Action Australia articles).

Tony Abbott: From Howard Loyalist to Political Mercenary?

Due to the high political stakes involved in Abbott reconfiguring Australia in the future, the anti-Turnbull plotters went to elaborate lengths (as they did in 2007 to sabotage Howard) to engineer a change of Opposition Leader in late November 2009. Interparty collusion to facilitate Malcolm Turnbull’s deposition was evident in the ABC’s Four Corners programme aired just before the leadership challenge. This programme deliberately highlighted opposition within the federal parliamentary Liberal Party to a bi-partisan Emissions Trading Scheme (ETS) for which Malcolm Turnbull had previously gained party room approval. This programme also cited polling data which alleged that there was deep public opposition to an ETS.

The ensuing leadership challenge was probably the most clinically precise and ruthlessly executed in Australian political history with a range of strange twists and turns. An example of the topsy-turvy nature of this leadership challenge was the federal opposition front bencher Joe Hockey declaring his support for Malcolm Turnbull by standing against him for party leader! Abbott at this stage also declared himself a leadership contender but projected the image that he was a third party candidate with relatively little chance of winning. However, in the final wash, it was Hockey’s candidacy which split the Malcolm Turnbull vote thereby clearing the way for Abbott to win the leadership by a one vote margin in the final leadership ballot.

Many media commentators and much of the public were aghast that someone such as Abbott with such an arch-conservative image had deposed a relatively popular Opposition Leader in the person of Malcolm Turnbull. *Consequently, there was a widespread mis-assumption that Tony Abbott was not electable to ever become Australia’s prime minister. Too many people did not however appreciate that Abbott had the capacity as Opposition Leader to help engineer a re-configuration of Australian politics which would lay the groundwork for his eventually coming to power.

(*The predominately left-wing ABC’s complicity in helping Abbott depose Turnbull as Opposition Leader on the premise that the former was too unpopular to ever win an election has rebounded on the national broadcaster. The Abbott government is now establishing an efficiency review of the ABC which could serve as a pretext to substantially undermine its viability. Furthermore, the ABC’s bias in favour of a carbon tax was also ironic because it was the adoption of this tax by the Gillard government in 2011 which crucially facilitated Abbott’s election as prime minister two years later).

Tony Abbott soon demonstrated that he could be a powerful Opposition Leader by helping influence government policy settings by publicly debating Prime Minister Rudd on the issue of hospital funding. The Opposition Leader ‘lost’ this debate which had the ramification of putting the prime minister ‘on track’ in May 2010 to sign with the state governments (with the exception of Western Australia) the so-called Hospitals Agreement where the states effectively ceded responsibility for funding their hospitals and with it a substantial portion of their GST revenue going to Canberra.

This May 2010 power grab (‘claw back’) by Canberra of state GST revenue was a crucial phase in the strategy to eventually introduce ‘regionalization’ (sic) by which states would eventually be abolished. At this crucial juncture in Australian history, it is worthwhile to analyse why Kevin Rudd was not a neo-Bonapartist leader.

Kevin Rudd Fails to be a Neo-Bonapartist Leader

To cut to the chase, as to whether Kevin Rudd was ever a neo-Bonapartist as leader, the answer is no! This is despite the fact that Rudd had ample to scope be a neo-Bonapartist. When Rudd was elected leader of the ALP in late 2006, he was in a position to be a neo-Bonapartist. His actual level of support within the ALP caucus was relatively low and disproportionately dependent upon SDA parliamentarians. Nevertheless, this support base gave him the balance of power so that he could do a deal with the larger Julia Gillard led bloc to depose Kim Beazley as Opposition leader in a ticket with himself as leader and Gillard as his deputy.

Kevin Rudd’s scope to be a neo-Bonapartist was strong during his term as Opposition Leader because the ALP was reliant upon his popularity with the voting public to win the next federal election. In a series of ALP commercials in 2007, Kevin Rudd proclaimed himself to be ‘fiscal conservative’ as part of ‘me tooism’ in which he matched the popularity of Howard’s conservatism with the electorate. Indeed, for all the internal sabotage which Howard had to contend with during the 2007 federal election campaign, he still could have won the poll if it were not for Rudd’s then high popularity with the public.

As prime minister, Kevin Rudd did not seem to realize the fine line between having power thrust upon him and his being used. Power in the first Rudd government between 2007 and 2010 was vested with a so-called ‘Gang of Four’ comprising the prime minister, Deputy Prime Minister Julia Gillard, Treasurer Wayne Swan and Finance Minister Lindsay Tanner. This concentration of power enabled the ALP government to make a series of precipitant gross financial mistakes such as splurging money on schools in the so-called Building the Education Revolution (BER) and borrowing recklessly in 2009 and 2010 to finance unnecessary stimulus packages to counter the onset of the 2008 Global Financial Crisis *(GFC).

(*Due to excellent prudential controls, Australian banks were amongst the safest in the world. Therefore, because credit lines in Australia were very secure, the borrowing and the spending of the stimulus packages which were undertaken by the Rudd government in 2008 and 2009 were absolutely unnecessary and economically counter -productive to say the least. The prudential banking controls which were then in place effectively insulated Australia from the 2008 GFC and arguably made Australian banks the safest in the world).

For Rudd to have become an effective neo-Bonapartist, he could have taken leaf out of the book of Indira Gandhi, for she was a neo-Bonapartist. She served as Indian prime minister between 1966 and 1977 and from early 1980 until her assassination in late 1984. Gandhi as the daughter of India’s first prime minister, the late Jawaharlal Nehru ,was installed as a figure-head leader by the faction leaders of the ruling Congress Party. During her first three years in office Gandhi carefully and methodically navigated her way to be in a position when, in 1969, she was able to break free from her puppeteers.

Kevin Rudd did not demonstrate a similar Gandhi sense of realization to appreciate that he was being used and to take steps to accordingly assert himself. Instead, Rudd indulged in petty power by making a series of ad hoc decisions which often left his fellow cabinet minister scrambling. Prime Minister Rudd also called senior public servants to meetings which he then cancelled even though they were often made to wait for hours. It was in this context that Julia Gillard arguably became Australia’s best ever *deputy prime minister. It was often Julia Gillard who picked up the pieces of chaotic cabinet decision making process or soothed relations with an often beleaguered public service.

(*The other contender for Australia’s best deputy prime minister was Sir John Mc Ewan, 1958 to 1971).

Julia Gillard’s Potential to Have Been Australia’s *Indira Gandhi

Julia Gillard in contrast to Kevin Rudd was a neo-Bonapartist type of leader. Her political background was both paradoxically simultaneously similar and markedly different to Abbott’s. Similar to Tony Abbott, Julia Gillard had a career in student politics. In contrast to Abbott, Gillard was actually a supporter of AUS, serving as that organisation’s national president in 1983. Nevertheless, in terms of the political parameters of the left-wing student factions which supported AUS, Gillard was on the relative political right as a leader of the student wing of the ALP Socialist Left (SL) faction.

(*Admiration of Indira Gandhi’s neo-Bonapartist leadership does not constitute approval of her semi-dictatorial actions during the state of emergency between 1975 and 1977).

As an AUS leader, Gillard tried to make this organization focus on securing higher levels of government funding to help student with everyday cost of living expenses. This pragmatic but compassionate approach to student politics often placed Julia Gillard at odds with the left-wing ideological extremists within AUS. This ‘issue’ of Julia Gillard’s ‘right-wingedness’ would later dog as she attempted to enter the mainstream of the SL of the ALP.

This future prime minister’s involvement with the echelons of the senior SL commenced in 1984 when she became one of a three person secretariat for the newly formed Socialist Forum organisation. Socialist Forum was formed primarily by former CPA members who closed up the Victorian state branch of their party as part of a transition to their joining the ALP in 1986. It was natural that the former CPA members would join the SL of the Labor Party but this faction itself was (and is) divided into a myriad of sub-factions.

Due to the political base that Julia Gillard had established in student politics and in the Socialist Forum, she involved herself in ALP factional politics after she became solicitor in 1987 with the Labor Left industrial law firm, Slater and Gordon. It is perhaps more accurate to say that Julia Gillard participated in SL sub-factional politics. Because of her reputation as someone who would not be dictated to by hard left bullies whether in AUS or Socialist Forum, Julia Gillard’s bid to join the SL faction was not automatically accepted.

Even though Julia Gillard not only eventually joined the SL but became a key operative in the state of Victoria in the 1980s and 1990s for that faction, she was still actively opposed by fellow factional stalwarts, such as Lindsay Tanner and Kim Carr, when she sought parliamentary pre-selection. Such hard-left factional leaders were wary of Gillard because they considered her to be too independent of factional discipline. Due to inter-factional alliances with the moderate Labor Unity faction (in which Julia Gillard gained a reputation for honouring deals,) Gillard gained ALP pre-selection and then subsequent election to the safe federal Labor seat of Lalor in outer south-western Melbourne in 1998.

Julia Gillard became one of the leaders of the inter-factional wing of the party which was generally opposed to Kim Beazley returning to the leadership of the ALP after he lost the 2001 federal election. During this period between 2001 and 2005, Gillard was a key leadership loyalist respectively for Simon Crean (2001 to 2003) and then for Mark Latham (2003 to 2005). When being a leadership loyalist, particularly for the latter (i.e. Mark Latham) became something of a lost cause, Gillard reluctantly reconciled herself to Beazley’s return to the ALP leadership in early 2005.

Nevertheless, Julia Gillard still commanded a substantial swag of inter-factional anti-Beazley votes which she aligned to help make Kevin Rudd ALP leader in late 2006 with herself as deputy. Although Gillard had more parliamentary votes than Rudd in her own right, she loyally served him as deputy, this was particularly so as deputy prime minister between 2007and 2010.

During her tenure as deputy prime minister, serving as Education and Training Minister and Minister for Employment Relations, the major policy achievements of the Rudd government were facilitated. This included the National Assessment Program-Literacy and Numeracy (NAPLAN) school tests which established teaching benchmarks to assess where students were at so that proactive education action could be taken to enhance their academic prospects by improved teaching delivery.

The administration of the NAPLAN tests caused such consternation amongst many teachers that Gillard was placed under enormous pressure from a range of teaching unions to abandon them. However, Gillard resisted such pressure so that there could be a framework for a transmission of teaching skill and knowledge to students via the education process.

Julia Gillard Support for the *‘Fair Go’ in Australian Industrial Relations

For any activists in teaching unions who may have taken exception to Julia Gillard putting school student rights at the forefront, they should have been mollified by her actions as Employment Relations Minister where she repealed the super unitarist Work Choices with the balanced and equitable Fair Work Australia (FWA) industrial relations legislation in 2009.

(*The ‘Fair Go’ is a long established Australian legal industrial relations concept which supports
socially just remuneration (pay) for wage earners in return for their labour).

FWA established a basis by which enterprise bargaining is placed front and centre of the industrial relations system so that there is scope for union renewal and for employer interests being taken into account. Enterprise bargaining is an interactive process between employers and unions (and/or employees in the case of non-union enterprise bargaining agreements) such that workplace arrangements can be arrived at to secure both productivity (i.e. higher profits) for employers and equity for employees.

A comparative international analysis of industrial relations around the world indicates that nations such as Germany and Japan have achieved either relatively high (or equitable) levels of remuneration because employee input has been strategically utilized by management to gain a competitive advantage. Enterprise bargaining is but one of many ways that an industrial relations system can facilitate a ‘win-win’ outcome for both employers and employees.

Julia Gillard showed that she was a neo-Bonapartist as deputy prime minister by converting her passions for education and industrial relations into the respective policy realities of NAPLAN and FWA. With regard to the latter, Tony Abbott can still be a neo-Bonapartist by maintaining the arbitral and enterprise bargaining of FWA. It should not be forgotten that it was at the instigation of Australian employers in the 1900s that arbitration was established which immensely benefited the union movement by helping underpin the existence of craft based trade unions.

Alas, the hard left of the Australian union movement consistently sought the demise of arbitration because they erroneously believed that it co-opted unions into a supposed ‘dependency syndrome’. A CPA approach to industrial unionism prevailed in the 1980s/1990s during the Hawke and Keating era, which while thankfully not undoing arbitration, very unfortunately facilitated the de-unionising process of trade union amalgamation of that period.

That Australian union membership density is now below twenty percent is primarily due to employees not wanting to belong to amalgamated industry unions and/or the failure of such unions to satisfactorily represent the interests of employees who came from particular craft backgrounds. There were the incredible financial dividends of new industry unions being responsible for massive superannuation funds but trade unionism is ultimately about representing members on the ground.

How and Why the Fair Work Australia Industrial Relations System Supports The Fair Go

Despite considerably diminished union capacity in a post-amalgamation context, the ramifications of union involvement in the arbitration system under FWA’s Fair Work Commission (FWC) are still flowing through to wage earners as well as adequate working conditions. This has been due to award protection of FWA underpinning wages and working conditions and enterprise bargaining safeguarding and/or improving the overall conditions of the employees who are covered by this process. By trade unions being a party to the awards which FWA issues and their helping negotiate enterprise bargaining agreements, Australian industrial relations is inherently an interactive and flexible process which can also serve the interests of employers should they actively participate in this pluralist system.

It may be true that FWC as an industrial tribunal, in terms of its composition, is slanted toward a union perspective. However it should not be forgotten that the Howard government’s abolition of the AIRC and its replacement under Work Choices with the Australian *Fair Pay Commission (AFPC) effectively ended what remained of a balance between employer nominated and union representation on the bench. Consequently, it was inevitable that with the Rudd-Gillard’s abolition of the AFPA, the vacuum would be filled by the FWC with a pro-union orientated bench given that the pendulum had swung away from Work Choices.

(*The ‘Fair’ in the Australian Fair Pay Commission under the Work Choices regime could have actually have meant ‘low pay’).

Perhaps it is natural that an Abbott government will over time restore an employer perspective to the FWC. However this will hopefully not mean that the coalition will establish a specialized judicial review/appeals section within the FWC which promotes de-unionization from the industrial relations system by establishing a new one-stop shop for employers and non-union employees to strategically bypass trade unions.

Prime Minister Abbott will hopefully appreciate that trade unions now fulfil an important role in representing Australia’s ‘forgotten people’. This term, which was originally coined by Sir Robert Menzies in 1942, which referred to small businessmen and housewives whose interests were not covered by either big business or trade unions. The contemporary equivalent of the ‘forgotten people’ are,* ‘unskilled’, ‘semi’-skilled employees and those in precarious causal employment for whom FWC award coverage and union enterprise bargaining can substantially improve their wages and working conditions.

(*In the United States, President Barak Obama is solidifying his base by seeking to ensure that the minimum wage and above is paid to ‘low’ and ‘unskilled’ employees. To avoid ensuing political marginalization, the Republican Party should move away from the anti-union Tea Party to embrace the traditions of Progressive Republicanism, that were once associated with Teddy Roosevelt in the first quarter of the twentieth century. Progressive Republicanism supported high pay which came from trade union representation at home while promoting a strong United States being involved in global affairs).

Even though Australian union membership density still languishes below twenty percent union, participation in the industrial relations system by award coverage and enterprise bargaining is having a beneficial impact on people’s working conditions and standard of living that it would be a violation of the Menzies tradition for the Abbott government to fatally undermine union participation. Unfortunately, the current Minister for Employment Senator Eric Abetz persists in wanting to establish a low paying industrial relations regime by de-unionising trade unions from the system.

With regard to de-unionization, Senator Abetz should realize that, due to the long term impact of union amalgamation, union membership density is not going to regain substantial ground in the immediate future. However, from Senator Abetz’s perspective, it is not so much the issue of union membership density which is of concern to him but rather that lower pay and bargaining conditions be facilitated by depriving unions of the capacity to fulfil their representation of interests function.

Should Senator Abetz be successful in pursuing a low wage agenda, then the Bill Shorten-Tanya Plibersek led ALP federal opposition will be canny and sufficiently articulate to alert the Australian people of this phenomenon. Most Australians are still acutely wary of any return to a Work Choices type industrial relations regime (particularly a re-introduction of individual employment contracts) in which wage and working conditions are deliberately undermined by federal government policy.

Australia At The Cross-Roads

The Shorten-Plibersek ALP leadership tandem’s capacity to alert the Australian people of the threat of a revived Work Choices industrial relations regime is reflective of the federal opposition’s potential to be a formidable operation. The Abbott government itself seems to pay stringent attention to workplace relations situations at a micro-level across the nation so as to facilitate specific de-unionization and to undermine general entitlement rights within the industrial relations system. These objectives are being pursued by the Abbott government despite its rhetoric about seeking improved employee working conditions.

The canvassed closure of the SPC Ardmona fruit processing plant site in Shepparton Victoria is a case in point. Prime Minister Abbott, in refusing to provide federal financial assistance so that SPC to keep its Shepparton operation viable, has stated that this viability can instead be achieved by scaling back work conditions and pay which he claims are in excess of the applicable award. There also seems be an implicit offer by the prime minister that, if employees forgo union representation, they will later receive higher pay and even better working conditions/entitlements.

It should be appreciated that unions fulfil the vital intermediary role as employee’s representatives of securing better employment conditions, especially under the aegis of enterprise bargaining. Unions, as in the case of SPC, are not adverse to temporary variations of enterprise bargaining agreements (EBAs) if they safeguarded long term employment viability. The flexible nature of enterprise bargaining is also one where unions can make short-term concessions on workplace conditions and pay in return for the eventual benefits of productivity gains flowing back to employees.

The point which needs to be accentuated is that unions are not inherent barriers to short to medium flexibility arrangements on the basis that the long term interests of employees are not sacrificed. It should also be pointed out that the opponents of SPC Ardmona receiving financial support as part of an industry/sectoral assistance policy are incorrect in categorizing this proposed support as ‘rent-seeking’.

Rent-seeking usually refers to an elite gaining near exclusive control of an extractive natural resource, such as oil, for their own subsequent wealth and power. Under this scenario, the division of the wealth pie contracts as it correspondingly enriches a minority at the expence of the majority. The super-profits tax policy for the mining sector, which the Rudd government was manipulated into adopting, was a prime example of rent-seeking.

Industry assistance need not be rent-seeking, and indeed, is not rent-seeking, if a greater amount of wealth (often taking the form of sustainable job creation) is facilitated. During the Menzies-Mc Ewan era, the socio- economic pie was expanded because targeted industry/sectoral assistance to economic sectors such as farming created wealth and employment which otherwise might not have existed.

There is of course the threat of industry/sectoral assistance degenerating into degrees of crony capitalism but, if there is a competent and honest government bureaucracy at the forefront of public policy administration, then these pitfalls can be avoided as they were during the Menzies-Mc Ewan era. Opponents of industry/sectoral assistance also claim that dangerous precedents are set whereby undeserving companies and corporations manipulate the state into granting them unfair assistance which serves to distort the economic balance.

It is correct that, if industry/sectoral assistance is to be provided, then transparent and strict guidelines should be established by governments as to the basis on which money is to be provided. Conducting an implicit social audit as to the ramifications of a major business going under should be undertaken. The Abbott government’s provision of sixteen million dollars worth of funding to the Cadbury chocolate factory and three and a half million dollars to the Huon Aquaculture plant in Tasmania, which had a state election in March 2014, demonstrates that the coalition is prepared to give relatively small amounts of funding which have a more than considerable positive employment impact that more than justifies pubic money being spent.

With regard to SPC Ardmona, whose parent company is the Australian division of Coca-Cola Amatil, its Shepparton plant probably did not need *industry/sectoral assistance. This is because Coca-Cola Amatil had unilaterally depreciated the value of the SPC Ardmona business to two hundred million dollars when the actual value is possibly more than the five hundred million purchase price that the company originally brought the company over five years ago. Instead of coherently explaining to the Australian people why industry/sectoral assistance can legitimately be denied to SPC, Prime Minister Abbott, as previously mentioned, has used this business example as a pretext to commence an attack on penalty rates.

(*The Victorian coalition state government of Denis Napthine is providing the SPC plant in Shepparton with over twenty-five million dollars in industry/sectoral assistance due to populist political pressure. While this aid may not be required in this instance, it would be wrong to invalidate the principle of industry/sectoral assistance. What is needed is a transparent and consistent approach by which an objective criteria can be applied to determine whether industry/sectoral assistance should be provided).

Even though the denial of industry/sectoral assistance in the instance of SPC Shepparton is appropriate because no jobs were really threatened, (particularly after this company entered into an apparently lucrative business arrangement with the Woolworths chain of supermarkets), in the Goulburn Valley region. Nevertheless, it is still disturbing that so-called economic rationalists in the Abbott cabinet have used this denial of industry/sectoral assistance to send out the message that government co-investment will not be provided to help maintain a mixed Australian economy. Already the message seems to have been conveyed by the Abbott government that the local car industry will not receive the government assistance which is provided in nearly every other nation in the world that has such an industry.

Concerning the issue of ‘messaging’, Australia is now at cross-roads. Hopefully, the Abbott government will convey the following messages in public policy that it will not allow:
- cheap food imports into the country to fatally undermine domestic food production,
- coal seam mining to usurp productive farmers from their properties,
- undermining of the invaluable export capacity of Australia’s agricultural sector,
- the consolidation of high levels of precarious employment,
- transitioning to a low wage de-unionised industrial relations system and
- Foreign Investment Review regulations and procedures to be abolished so that the People’s Republic of China (PRC) *State Owned Enterprises (SOE) can take control of vital Australian strategic agricultural properties and industries.

With regard to the last point, a so-called Free Trade Agreement (FTA) between Australia and the PRC threatens to give carte blanche to Chinese SOEs to purchase Australian agricultural properties and other economic resources. Indeed, it seems that the April 2014 visit that Prime Minister Abbott made to the PRC, which included a high powered delegation (‘Team Australia’), is sending the message to Beijing that it will be alright for Chinese SOEs to move into Australia to become powerful economic drivers.

There is nothing inherently wrong with foreign investment in Australia. However the PRC is currently a dictatorship with a hybrid market socialist economy where the government must consistently stimulate high growth rates of eight percent and higher to sustain its socio-economic system. There unfortunately must on the part of the PRC’s leadership be a degree of coercion employed because resource acquisition is a prime objective to maintain their socio-economic system. In this context Australia potentially offers an opportunity to a neo-mercantilist PRC to acquire economic resources such as mining and agricultural interests to help Beijing meet planning goals.

If there is to be an Australia economically and politically subordinate to the PRC there must be an elite which is prepared to collaborate with Beijing. The high powered delegation which accompanied Prime Minister Abbott of state premiers, senior business people, parliamentarians and prominent former political leaders from both the major parties either wittingly or otherwise sent out a message that such a collaborationist elite is in formation. It is noteworthy that either by omission or design the Telecommunications Minister Malcolm Turnbull was not a part of Team Australia which might indicate the he has the integrity to resist joining a newly emergent self-serving elite.

This emerging elite will need a socio-political structure with which to exercise their economic power. Eventually replacing Australian states with a new regional tier of local government will help insulate the power of a new elite. Socio-economic and political power will be concentrated at a new regional tier of government which due to its diffuse nature will be more malleable than what states because their substantial size and constitutional sovereignty serve as barriers to economic exploitation and corruption being perpetuated.

Indeed, the successful functioning of the Independent Commission Against Corruption (ICAC) in New South Wales among other things illustrates that given human nature there must be eternal vigilance against corruption. If states are eventually phased out and their service functions devolved to a new substantial regional tier of government controlled by political hacks then the scope for patronage and corruption will massively escalate because of the defuse manner in which power will be exercised. Under such a regionalized socio-economic regime PRC SOEs will also be able to exercise considerable power because the vulnerability that such a diffuse structure will engender toward perpetuating corruption.

Due to the high risk nature of the current political stakes in Australia, it will be vital that any FTA with the PRC does not sacrifice current Foreign Investment Review regulations. Even if a Sino-Australian FTA has trading arrangements which disadvantage Australia, these should be endured so long as Foreign Investment Review regulations are maintained so that the nation’s sovereignty and economic capacity can be maintained. Australia will also be able to maintain its economic and political independence if the current system of federal-state relations is maintained. Such a maintenance will prevent the emergence of a new collaborationist elite.

It should be emphasised that wariness about the Chinese Communist regime’s strategic designs on Australia is not reflective of a racist attitude toward the Chinese people but a wariness towards Beijing’s current sense of political direction. As its developing alliance with Putin’s Russia indicates, the PRC is reinforcing the Leninist power-over approach (win-lose) component within its hybrid market socialist economic system. That is not to say that SOEs should be dismantled because they have been very successful at staving off mass unemployment as have regulatory audits of businesses which have obliged businesses to put on employees.

However, a regimented approach toward socio-economic policy is not viable in the long-term because a power-over approach being applied too so many people will eventually cause too much *resentment. Furthermore, for the market component of the PRC’s hybrid system needs to be sustained there has to be more growth in the Chinese private sector so that high levels of employment can be sustained on a long –term basis. Hopefully the PRC’s leadership will avoid the dead-end approach of Putin’s Russia of using coercion to gain and maintain control of economic resources. This approach is flawed because an exhaustion point eventually has to be reached.

(*While high economic growth rates are been achieved public unrest in the PRC can and is being avoided).

For the PRC to acquire sustainable prosperity and lasting political stability the authorities in Beijing will hopefully allow for independent economic and political actors to emerge by developing a transparent banking sector and allowing for an independent share market to be developed along with free trade unions which operate within a pluralist industrial relations system.

These positive developments would hopefully lay the groundwork for mainland China to eventually have a two-party system which engenders a sense of everlasting national unity. A Chinese electoral democracy would be complemented by having a brilliant and honest apolitical civil service which ensures that discrepancies between regions of China do not develop. Having the rule of law and a mature system of local government would also be vital to ensuring the socio-economic sustainability of the Chinese nation state.

Why The Dragon Must Beat The Hourglass

As the nation with the world’s largest population, time spans have often been critical with regard to Chinese leaderships implementing reform before events overtake their capacity to control events. A Chinese leader who was probably aware of this reality was the Dowager Empress T’zu Hsi. Had Her Imperial Majesty not died in 1908 but lived into her nineties by living for a further twenty years she may have gone down in history as China’s greatest ever ruler.

This positive perspective is derived from reading Jung Chang’s biography of the Dowager Empress entilted Empress Dowager Ci Xi The Concubine Who Launched Modern China (Jonathan Cape, London, 2013). Chang, who is also the author of the acclaimed books Wild Swans: Three Daughters of China and the co-author of Mao: The Unknown Story has written a revisionist biography of the Dowager Empress, which upon reflection contains implicit warnings to Chinese rulers against squandering time with regard to undertaking needed reform.

This biography of the Dowager Empress is confronting because it challenges long-held stereotypes with regard to the ‘Old Buddha’ being a ruthless reactionary whose rule all but doomed the imperial Ch’ing dynasty. The author argues that the Dowager Empress was the leader who took China from the Middle Ages into the then modernity of the early twentieth century. This contention is argued with an unusual combination of clarity and passion.

Indeed, a sceptic might argue that Chang has focused with calculated precision to deliberately refute those charges which have long been made against the Dowager Empress to blight Her Majesty’s reputation. Chang specifically challenges the widely held belief that the Dowager Empress was culpable for her nation’s defeat in the 1894-95 Sino-Japanese War by her siphoning off funds from the Chinese navy to build the Summer Palace.

It is correctly pointed out by Chang that the Dowager Empress had retired from power in 1889 when her nephew the Emperor Kuang-Hsu reached his majority so that it was the emperor’s advisers who were responsible for losing the war to Japan. The specific charge that the Dowager Empress had siphoned off money from the naval budget is refuted by Chang on the basis that only a relatively small amount of money was diverted by T’zu Hsi . That she was actually previously responsible for constructing a modern navy for China is asserted by Chang to help exonerate the Dowager Empress. Chang also passionately argues that it was the Dowager Empress, who far from being the cause of China’s disastrous defeat, actually valiantly held out from her semi-retirement to vehemently argue against her nation signing the capitulating Treaty of Shimonoseki with Tokyo in 1895.

Perhaps the most extraordinary claim made by Chung is that the reformer K’ang Yu-wei was a traitor who if he had taken power would have converted China into a Japanese satellite. K’ang was an advisor to the Emperor Kuang-Hsu. His Majesty since the military defeat of 1895 had gathered around him a coterie of new imperial advisers who were determined to convert China’s disastrous military defeat by the Japanese defeat into an opportunity for national renewal. These advisers launched a series of relatively radical changes in 1898 which became known as the ‘One Hundred Days Reform’. It has been generally accepted by historians that these reforms were well-intentioned even if they were rashly conceived.

Chang however makes the extraordinary claim that K’ang was beholden to Japan and had he politically neutralized the political influence of the Dowager Empress that China would have become a Japanese satellite. This assertion is incredible, but given the insights that Chang has as an historian, this contention may be correct. It is beyond doubt that the Dowager Empress’s September 1898 coup against her nephew was if anything self- defensive because the Emperor had previously commissioned the devious General Yuan Shi-k’ai with the task of arresting his aunt.

General Yuan’s defection facilitated the Dowager Empress’s return to power by way of a military coup. Indeed, had General Yuan not betrayed the Emperor by siding with the Dowager Empress, then T’zu Hsi might have been subjected to life-long house arrest or even execution.

While the September 1898 coup may have been justifiable by the Dowager Empress as an act of self-preservation, the return to power is still controversial in that needed reform was probably quashed. With regard to the Dowager Empress’s motives, Social Action Australia believes that Her Majesty was a conservative as opposed to a reactionary ruler. During her first time in power during the respective minorities of her son and then her nephew as emperors between 1861 and 1889, the Dowager Empress utilized traditional power structures to keep China together in the context of massive foreign encroachment.

However Social Action Australia believes that the Dowager Empress then lacked the vision to utilize the opportunities which came with foreign incursions and imposition of the unequal trade treaties to take up new ideas so that China could successfully adapt. Chang would probably take issue with this interpretation of history because she argues that industries and new transportation systems, such as railways, were introduced to China during this time of the Dowager Empress’s rule. This contention can be countered by saying that technological advances were more the result of China being opened up to the world as a result of the unequal treaties which had been imposed between 1842 and 1943 then a lateral approach to statecraft on the part of T’zu Hsi.

Whatever abilities T’zu Hsi had, it is beyond doubt that the Dowager Empress seriously erred by supporting the Boxer Rebellion in 1900 in an attempt to expel foreign military forces from China. While the patriotic motives of the Dowager Empress were beyond dispute, it should be pointed out that had the reactionary Boxers prevailed then China would have been plunged into an abyss of backwardness.

Paradoxically, the Dowager Empress’s near fall from power in August 1900 as she fled the advancing Allied armies as they entered Peking illustrated her indensensibility in keeping China together. Had the *Dowager Empress died in August 1900 or been arrested by the Allies then China’s unifying power structure based upon Confucian ethics would have rapidly collapsed and with it Chinese national unity. The Allies then would have been confronted by the scourge of warlordism which descended on China following an abortive attempt to reinstate the Ch’ing imperial dynasty in 1917. Therefore even though the Dowager Empress was bowed by her banishment to the interior province of Jehol in north-eastern China, her diminished executive power was still sufficient to maintain Chinese national unity.

(*There was the notional option of restoring the detained Emperor Kuang-Hsu to power but such an outcome would have been countered by the Dowager Empress executing her nephew whom she kept in close proximity to her person as a security precaution).

Due to Her Majesty’s importance in maintaining national unity, the Allies consented to the Dowager Empress’s return to Peking in 1902. It is in the period between 1902 and 1908 that Social Action Australia believes that the Dowager Empress became an enlightened conservative having been chastened by her previous banishment. Certainly, Chang’s argument that the Dowager Empress was a reformer in this period is difficult to challenge. During this period ancient practices such as foot binding and torture were abolished by imperial decree while the ancient system of Confucian civil service exams was reformed as was the judicial system. Promisingly, a transitional parliament with a consultative role was appointed in 1907.

Perhaps the most important reform that T’zu Hsi initiated in 1905 was a decree establishing a Constitutional Office and stipulating a time table that by 1917 China would be a constitutional monarchy. Given the benefit of hindsight the Dowager Empress should have had a quicker time table to head off at the pass the approaching republicans. Nevertheless, while the Dowager Empress remained in good health her hold on power was secure so that her timetable for constitutional reform was viable.

Alas, time was to run short for the Ch’ing imperial dynasty for the Dowager Empress fell fatally ill from dysentery in 1908. Had T’zu Hsi lived there is little doubt that given determination and tenacity, which more often than not compensated for her personal shortcomings, she would have advanced China to being a constitutional monarchy by 1917. It is also plausible that had a powerful Chinese equivalent of a British Tory Party or a Russian Octoberist Party been formed that a constitutional monarchy would have been maintained rather than serving as an eventual transition to a *republic.

(*K’ang Yu-wei unfortunately envisaged China’s progression to a constitutional monarchy as setting the scene for the later peaceful transition to a Chinese republic).

Had the Dowager Empress being ruling over a united China during the First World War it is not beyond the realms of possibility that she would have committed substantial numbers of Chinese troops to the Western Front on the Allied side in return for a renunciation of the unequal treaties and an end to the foreign military presence in China. However, even if T’zu Hsi had been able to achieve an end to the unequal treaties, Japanese militarism would probably have continued as debilitating factor confronting China.

Unfortunately, however, the rapid decline in the Dowager Empress’s health in 1908 precipitated a succession crisis. Chang goes into detail as to how the Dowager Empress confronted her mortality in Chapter 31 entitled Deaths (1908). Inexplicably this author does not address the widespread rumour which was given credence by Reginald Fleming* Johnston in his book Twilight in the Forbidden City (Oxford University Press, 1987) that it was General Yuan Shi-kai and not the Dowager Empress who had the Emperor Kuang-Hsu poisoned.

(*Johnston was the tutor and then counsellor to the so-called Last Emperor Hsuan-Tung who was popularly known by his non-reign name of (Henry) Pu YI).

It is argued in Johnston’s book (which was first published in 1934) that General Yuan was afraid that if Emperor Kuang-Hsu regained power by outliving his aunt that His Majesty would have him executed. Johnston therefore gives credence to the belief that eunuchs at the behest of General Yuan had the emperor poisoned. By contrast and somewhat ironically given that Chang is a *defender of the Dowager Empress, she writes that T’zu Hsi had her nephew poisoned. Chang’s assertion is made on the basis that the Dowager Empress instigated this murder because the Emperor Kuang-Hsu would have been too beholden to the Japanese if restored to power.

(*Chang also accepts the widely believed story that T’zu Hsi upon fleeing the Forbidden City in August 1900 had the imperial consort Princess Pearl killed by having her thrown down a well. There is the scenario Princess Pearl actually committed suicide as the Allies advanced on Peking and that the story of her murder was fabricated by the now discredited oriental scholar, the anti-T’zu Hsi, Sir Edmund Backhouse).

The analysis that Chang provides of Emperor Kuang-Hsu’s and the Dowager Empress’ deaths negates the context of the succession struggle that was then taking place in November 1908 which involved General Yuan Shi-k’ai . As the Dowager Empress was dying she designated the two and half old Pu Yi as the next emperor. Her Majesty did this in direct response to General Yuan advocacy that his ally, Prince P’u-Lun, be appointed as the heir to the throne. General Yuan stridently opposed Pu Yi’s nomination because he knew that the soon to be late Emperor Kuang-Hsu’s half brother Prince Chun would become regent.

Even though Prince Chun did become regent upon the Emperor Kuang-Hsu and the Dowager Empress dying within twenty-four hours of each other, T’zu Hsi decreed that the new regent should defer all important decisions to the new Dowager Empress Lung-Yu who was T’zu Hsi’s niece and the recent widow of the late emperor. Chang does not refer to Regent Prince Chun and the new Dowager Empress Lung-Yu’s ascending to power in November 1908 against the backdrop of Yuan’s opposition. Indeed, Neville Irons, in his book The Last Emperor, The Life of the Hsuan-Tung Emperor of China (House of Fans, 1983) wrote that the dying Emperor Kuang-Hsu willed that the new regents posthumously avenge him by having General Yuan executed.

The two new regents wishing to avoid having blood on their hands instead of executing General Yuan had him dismissed as commander of the formidable Peking Garrison and banished him to his estate to tend to a supposedly sore foot. Johnston and Irons (but not Chang) pointed out in their respective books that General Yuan was a treacherous foe who had the potential to bring down the Ch’ing dynasty.

The subsequent fall of the Ch’ing dynasty nearly three years later (1911 to 1912) has more often than not being partly attributed to the supposed inadequacies of Prince Chun and the Dowager Empress Lung-Yu. To be fair to them they earnestly attempted to follow the Dowager Empress’s bequeathed reform programme. The critical mistake that the regents made was to too literally adhere to T’zu Hsi’s timetable at the expense of expanding and applying her specified reforms with greater alacrity.

There were elections in 1909 to provincial legislatures as the Dowager Empress T’zu Hsi had envisaged but on an extremely low voting suffrage of approximately one percent. The following year a national parliament was formed but with half of its members appointed and the other half chosen by the provincial legislatures. Nevertheless, this legislature on convening demanded the immediate transition to a responsible parliamentary government. The regency responded by conceding in April 1911 with the formation of a modern style of cabinet, albeit one of composed mainly of aristocrats which was responsible to the throne and not to the parliament.

Had the Prince Regent and the Dowager Empress Lung-Lu instead held elections on a more substantial suffrage and then granted responsible parliamentary government the republican revolution which commenced in Wuhan in October 1911 would have been avoided. Furthermore, the formation of a government backed nation-wide monarchist party would have safeguarded the continued viability of the Chinese monarchy.

Instead, because the regents had acted too slowly events subsequently overtook them between late 1911 and early 1912. Even with the outbreak of the republican revolt in October 1911 the military advantage still lay with imperial government. Unfortunately, Prince Chun and the Dowager Empress Lung-Yu unduly panicked by imploring the treacherous General Yuan to assume command the army to crush the spreading southern revolt.

Yuan responded by sarcastically feigning a sore leg as the basis to his declining the commission. It was not until Prince Chun had agreed to formally resign in December 1911 as regent in favour of the Dowager Empress Lung-Yu and his being appointed prime minister that Yuan launched a successful military offensive against the republicans in January 1912. Yuan then suddenly resigned his posts and declared himself a republican! Even though the military advantage was still with the monarchy the Dowager Empress Lung-Yu agreed to negotiations brokered by Yuan between the republican rebels and the government to avoid further bloodshed.

The ensuing deal that General Yuan brokered saw the creation of a republic by imperial decree in February 1912 with this traitorous general becoming the new president. As a sop to the now deposed Ch’ing dynasty the emperor was allowed to retain his title for life and reside in the Forbidden City until eventually permanently moving to the Summer Palace. When President Yuan tried to enforce this stipulation in January 1913 a desperate Dowager Empress Lung-Yu successfully appealed to the loyalist General Chang Hsun for protection against such a move. Nevertheless the shock of President Yuan’s order was such the Dowager Empress Lung-Yu prematurely died in February of that year.

Jung Chang makes the important point that T’zu Hsi selected Empress Lung-Yu as her successor on the basis that a woman would be more prepared than a male ruler to make way for a republic if a face-saving arrangement could be arrived at for the Ch’ing dynasty. This author also wrote that the Dowager Empress T’zu Hsi was prepared to sacrifice the dynasty to safeguard her Manchu ethnic minority which she feared would be wiped out during a bloody and protracted republican revolt. Indeed, General Yuan’s treachery probably enabled the Dowager Empress Lung-Yu to implement T’zu Hsi’s planned contingency of expeditiously making way for a republic in return for safeguarding the Manchu ethnic minority.

Paradoxically, T’zu Hsi not having formulated such an exit strategy might have emboldened the Ch’ing dynasty not to squander their military advantage and to subsequently persevere until victory had been achieved over the republicans. The more important point however is that a republican revolt could have been avoided in 1911 had the regency implemented T’zu Hsi’s envisaged reforms ahead of time.

The disaster of China proceeding to a republic rather than a constitutional monarchy was borne out by the aftermath of December 1912/January 1913 elections. These elections, which had a substantial middle class franchise, were won by the recently formed Kuomintang (Chinese Nationalist Party), the KMT. The KMT’s leader was Dr, Sun Yat-sen who had been the spiritual leader of Chinese republicanism and who had initially served as president of a rebel republic before giving way to General Yuan. The three runner up pro-Yuan parties in these elections later coalesced into the Progressive Party.

Had President Yuan accepted the KMT election victory, a government of national unity with Sun serving as prime minister could have been formed. Such a government could have entered the First World War on the Allied side to achieve a revocation of the unequal treaties which had been inflicted upon China. Instead, Yuan undermined the scope for Chinese national unity to be maintained by instigating the assassination of Sung Chiao-jen, the KMT’s chief organiser.

Sung’s 1913 assassination precipitated the so-called ‘Second Revolution’ that year which Yuan crushed so that he was able to entrench his own dictatorship. But Yuan desired more than being a de facto president for life. For him, the Chinese republic was to be an interregnum between ouster of the Ch’ing dynasty and the establishment of his own imperial dynasty. Yuan’s proclamation of himself as emperor in late 1915 caused a revolt among his own commanders that he reluctantly rescinded his enthronement to die a broken man in June 1916.

The 1916 constitutional ascension to the presidency of Vice-President Li Yuan-hung seemed to herald the consolidation of the Chinese republic with the prospect of progression to a genuine democracy. However, the noble but abortive attempt of General Chang Hsun to reinstate the monarchy in July 1917 by a coup caused the subsequent collapse of national unity. The array of army commanders who rebelled against General Chang did not did not subsequently submit to central authority. Consequently, by 1920 the authority of the Peking government had become fictional. The only substantial gain for the warlord (or coalition of warlords) who controlled the Chinese capital was their gaining diplomatic recognition by the foreign powers as heading the de jure but nominal government of China.

It was into this chaotic vacuum that the new Communist Russian state entered by supporting Sun Yat-sen’s Canton based government in southern China. A Russian Communist operative named Michael Borodin organised the KMT along democratic (sic) centralist Leninist lines and Soviet military advisers were despatched to help run the newly established Whampoa Military Academy from which the KMT’s National Revolutionary Army (NRA) would be established.

Nationalist China

The Soviets support for Sun in Canton was not altruistically motivated. Moscow regarded the KMT as an empty vessel which could be exploited as a Trojan Horse to eventually take power on a national basis because the ranks of the Chinese Nationalists within their party and armed forces were substantially infiltrated by operatives of the Soviet directed Communist Party of China (CPC). The NRA commander Generalissimo Chiang Kai-shek during his Northern Expedition, which he launched from his base in Canton in 1926 (a year after Sun Yat-sen’s death) violently purged the CPC from KMT ranks in 1927. The Northern Expedition successfully ended in June 1928 when the NRA took Peking thereby achieving the notional re-unification of China.

While Chiang Kai-shek however only directly controlled five provinces his alliance with General Chang Hsueh-liang, the warlord ruler of Manchuria in north-eastern China, ensured the Generalissimo’s overall dominance. Nevertheless, Chiang’s political position was precarious because he had to contend with wayward warlords, factionalism and corruption within his own party and military and a myriad of competeting power cliques which constituted his power structure with himself at the epicentre.

Chiang realized that the major challenge which confronted him was that of the CPC. Having previously visited the Soviet Union as part of a KMT delegation, Chiang was under no illusions as to how formidable both Moscow and their wards, the CPC were. What military strength Chiang could muster between *1928 and 1936 was dedicated to eliminating the CPC. Chiang was on the brink of eliminating the CPC in December 1936 when a frustrated General Chang Hsueh –liang seized him in Xi’an to force China’s leader into an alliance against an increasingly militarily aggressive Japan.

(*The Generalissimo also had to contend with other warlord revolts during this period).

The reprieve that the so-called Xi’an Incident afforded the CP C became a windfall for the communists following the outbreak of outright war between China and Japan in July 1937. The Sino-Japanese War (1937 to 1945) depleted Generalissimo Chiang’s strength that he was in a consequently vulnerable position to fight the CPC after Japan’s defeat in World War II came in August 1945.

It was therefore a tragedy that from his stronghold in Chungking in south western China which served as the nation’s wartime capital that Chiang Kai-shek did not reform his regime so that it could later successfully face off against the CPC. The resident American general, Joseph Stilwell, observed the massive corruption within the Nationalist regime that he presciently predicted its post-war demise before a communist onslaught.

Had Chiang Kai-shek worked in collaboration with his son Chiang Ching- kuo (CCK) and General Stilwell to root out corruption between 1942 and 1943, then this development, combined with an honest and judicious application of massive American military and financial aid to the Chungking based regime, would have put the KMT in good stead to win the ensuing civil war against the CCP following Japan’s 1945 surrender. Instead, the Generalissimo instigated General Stilwell’s recall because he had no intention of reforming his regime.

Chiang was not personally corrupt but he was too tolerant of corruption because he was not prepared to forgo the support of corrupt figures who would never challenge him because they needed his protection. China’s Nationalist leader may have gotten away with leading a regime based on self-interest if he did not have to contend with such a formidable military and political adversary in the CPC which by 1948 had gained a military ascendancy in the Chinese Civil War (1946 to 1949).

The fall of Peking to the Communists in January 1949 led to a realization on Chiang’s part that he would inevitably lose the civil war on the mainland. The Generalissimo over the next eleven months made virtue out of necessity by methodically retreating from the mainland to the island of Taiwan. Even though Chiang’s retreat to Taiwan had been brilliantly executed, his regime would still have fallen had it not been for the outbreak of the Korean War in 1950 precipitating the despatch of American navy ships to safeguard the Taiwan Straits.

Even on Taiwan, time seemed to be against Chiang because he was apparently too reliant upon a narrow mainlander support base who ruled over a resentful Taiwanese majority which made up approximately eighty percent of the population. It was apparent to astute observers of Chinese Nationalist politics that if it was not for Chiang establishing a police state that the regime would fall for want of popular support. At best it was thought that as a result of comprehensive land reform, the prosperity and high standard of living which Chiang’s government had achieved on Taiwan by the 1960s that the regime had gained grudging sullen toleration rather than popular acceptance.

Nevertheless, powerful forces were in motion which would safeguard the KMT’s long term future. This was due to the incredible astuteness of Chiang’s brilliant neo-Bonapartist son, CCK. The younger Chiang between 1950 and 1965 controlled the island’s secret police and in that position he crushed opposition as he presided over a covert power apparatus which was virtually a state within a state. The secret police which CCK presided over was overwhelmingly mainlander.

However, CCK similar to the Dowager Empress following Her Majesty’s return to Peking in 1902, was no fool. As the secret police supremo, CCK was keenly aware from unvarnished intelligence reports that there was acute unrest amongst the Taiwanese majority. He accordingly established and headed in the 1950s the KMT’s new youth wing, the Youth Corps. Recruits from the youth corps were subsequently appointed to civil service and local government position which reflected the island’s population demographics.

There was no resistance from the mainlander elite of CCK’s policy of ‘Taiwanization’ which accelerated as he progressed to defence minister in 1965, deputy prime minister in 1969 and *prime minister in 1972. There was a belief in KMT elite circles that it did not matter if Taiwanese assumed administrative positions, or even the presidency, because real power would always reside within the military and the secret police which was overwhelmingly mainlander dominated.

(*CCK in effect assumed de facto leadership of Nationalist China when he became prime minister in 1972. His increasingly infirm father remained nominal leader as president and following Chiang Kai-Shek’s death in April 1975 the presidency was assumed by the vice-president, the respected economist, Dr. Yen-Chia-kan, who in 1978 supported the National Assembly’s election of CCK to the presidency).

There was consequently no elite mainlander resistance to CCK’s selection of a Taiwanese technocrat Lee Teng-hui as vice-president in 1984. In elite circles it was believed that should Lee ascend to the presidency that de facto power would really pass to Vice-Admiral Wang Hsi-ling who was then in charge of the island’s main intelligence bureau. But in 1985 President Chiang had Admiral Wang publicly tried for instigating the assassination of a political dissident living in California! The ramifications of this trial were profound because the covert power of the military intelligence services was fatally undermined as substantial power actually began to shift to the KMT which until then had essentially functioned as a civilian support auxiliary for the government.

The sudden and dramatic lifting of martial law in July 1987 by CCK substantially continued the process of shifting power away from the military establishment to civilian authority such that when Vice-President Lee succeeded to the presidency upon the death of his mentor (i.e. CCK) in January 1988, he was in a position to actually exercise authority. The wily President Lee in his own right transformed the Republic of China (ROC) on Taiwan so that by the time he retired in 2000, this Chinese nation was fully-fledged democracy !

The KMT during Lee’s period was transformed from the anomaly of being an anti-Marxist political party with Leninist structures into a catch-all political party with a centre-right orientation. Indeed, the KMT even had to endure going into opposition in 2000, but eight years later, the Grand Old Party of Chinese politics democratically regained power. The again ruling party’s opposition to Taiwan formally separating from the Chinese nation has led to a *rapprochement between the ROC government and the PRC. There is consequently no hint of military tension between the two Chinas and cross-strait trade and tourism now flourish.

(*Taiwan’s ruling party has also been allowed to re-open a party Headquarters in Canton and inter-party relations between the KMT and the CPC seem cordial).

The stupendous success that the KMT has achieved is due to the groundwork which was set by CCK. His secret was that he did not allow events to overtake him but rather kept ahead of the game. The Dowager Empress T’zu Hsi demonstrated a similar skill with regard to time horizons. Unfortunately this transformation occurred too late in Her Majesty’s reign after the calamity of her foolishly supporting the 1900 Boxer Rebellion. Nevertheless, had sudden ill-health and death not suddenly overtaken T’zu Hsi in 1908 then the colossal disasters which later befell China could have been avoided, including the Communists under Mao coming to power in 1949.

That is not to say that Deng Xiao-ping as China’s paramount leader between 1978 and 1997 did not achieve incredible and positive successes in his overcoming the disastrous impacts of Maoist mis-rule. Deng had a similar talent of keeping ahead of time, although events nearly overtook him 1989. Nevertheless, Deng’s stunning and surprising re-launch of market reforms in February 1992 demonstrated that Chinese leaders can shape the times by being ahead of the game.

The Dragon and the Kangaroo

The CPC’s senior leadership can still strategically transform events by moving beyond Leninist power structures and mindsets. Indeed, Australia in a modest, but still important way, could still contribute to such a transformation by not becoming a client state of the PRC. A message can be sent to Beijing from Australia that the Australian nation will not assist the PRC in perpetuating an authoritarian Leninist political system and neo-mercantilist economic system by either abolishing its states or dropping Foreign Investment Review guidelines for PRC SOEs.

Australia in a modest, but still important way, could still contribute to the aforementioned outcomes for mainland China by not becoming a client state of the PRC. A message can be sent to Beijing from Australia that this nation will not assist the PRC in perpetuating an authoritarian Leninist political system and neo-mercantilist economic system by either abolishing its states or dropping Foreign Investment Review guidelines for PRC SOEs.

Australian sovereignty since 1983 has already suffered too much with regard to it being undermined by the application of so-called economic rationalism. This public policy approach is reflective of the fact that senior politicians from both the major parties have been prepared to inflict suffering on their people by rigidly adhering to this supposed orthodoxy (i.e. economic rationalism). Similarly, if too many Australian political leaders have been prepared to apply economic rationalism then it is plausible that they would treasonably sell out their nation’s socio-political interests to a neo-mercantilist/Leninist PRC.

The Irrationality of Economic Rationalism

Indeed it would be a pity if the Abbott coalition government were to continue on with the so-called economic rationalist policies of the Hawke-Keating era which due to unnecessary tariff cuts and an excessively high interest rates regime destroyed productive sectors of the economy. This era was also one in which nothing was done to pay off the dangerously high levels of public foreign debt which had progressively accumulated.

Overall, the excellent banking prudential controls which were put in place during this time helped make Australian banks possibly the best in the world so that the financial sector was able to crucially help the nation’s primary producers revive. That there was an economic revival during the Howard-Costello era was due to paying off the massive public foreign debt and utilizing financial windfalls (derived partially from the revenue of a Goods and Services Tax, GST) for, at times, selective industry/sectoral assistance.

Actually, industry/sectoral assistance have long been a mainstay of Australia’s socio-political reality. Currently, the Australian Productivity Commission estimates that the finance sector receives over nine hundred million dollars in financial support and that nearly one and a half billion dollars in subsidies is provided to Australian farmers. Therefore, it is ridiculous for Treasurer Hockey to advocate against industry/sectoral assistance when it is a long-standing policy reality for Australia. The real question is how can industry/sectoral assistance be judiciously provided?

Prime Minister Abbott is squandering the potential talents of Industry Minister Ian Macfarlane and Agriculture Minister Barnaby Joyce by forgoing formulating and implementing an explicit industry/sectoral assistance policy to help safeguard current employment and generate new jobs. The proposal which elements of the National Party support of establishing a Rural Reconstruction Development Bank (RRDB) integrated with the Reserve Bank of Australia (RBA) is reflective of sensible public policy in the Menzies-Mc Ewan tradition.

Australian farmers have long being vulnerable to the vicissitudes of the weather no matter how productive and efficient they are. While government drought assistance should be provided to Australian farmers, systemic structural assistance is required for the nation’s rural sector. The substantial drought assistance that the Abbott government is offering farmers is to be welcomed but more systemic support is required which breaks with the destructive economic rationalist policy paradigm.

Having a RRDB providing a structural means of providing desperately needed relief from debt and high interest rates would help ensure the viability of small to medium sized Australian farms which are threatened by the possible entry of PRC backed agro-businesses which could become an integral part of a future rentier state.

A rentier Australian state would be the antithesis of a laissez faire market economy which economic rationalists so stridently advocate. Consequently industry/sectoral assistance aimed at protecting and/or promoting private enterprise, such as family based farming, is not a statist type of ‘leftie’ socialism but a means by which vital economic diversity and sustainable employment can be facilitated.

The deputy prime minister and Country Party leader Sir John Mc Ewan between the 1950s and early 1970s helped responsibly apply macro-policy (‘Mc Ewanism’- ‘Protection All Round’) of considered industry/sectoral assistance (which although threatened by the Whitlam government, 1972 to 1975) lasted until it was essentially and ironically dismantled by ALP governments of the Hawke-Keating era between 1983 and 1996. A crucial component of Mc Ewanism was the provision of tariff protection for the car industry in Australia.

Tariff protection for the car industry in Australia has been phased out but industry assistance has since has continued in the form of government grants to car manufacturers. However, this variation of industry assistance is now coming to an end with the foreign investment managers of the car corporations of Ford, General Motors and Toyota announcing that they will cease car production in four year times.

Perhaps it is correct to say that the paying of subsidies to the car sector in Australia is ‘throwing good money after bad’. However, Treasurer Joe Hockey should be challenged to identify a car industry anywhere in the world which does not receive some sort of government industry assistance. Instead of providing a bottomless pit of subsidies to car manufacturers in Australia, the Abbott government should consider re-introducing tariffs on imported cars so that the nation has a viable domestic auto-manufacturing industry.

The FTA recently signed with Japan practically precludes the re-introduction of car tariffs. However, it should not be forgotten that Japanese car manufacturers would benefit from the re-introduction of tariffs because there would be guaranteed protection for their foreign investment in Australia. Furthermore, Neo-Mc Ewanism would not only provide the government with a tariff revenue stream but attract needed manufacturing investment in Australia which is crucially required for employment sustenance in the car sector and in associated flow on industries.

Self-declared economic rationalists will inevitably decry that the market will become distorted by higher prices for imported cars. This can be countered by the fact that there will always be enough consumers with sufficiently high income who will always be able to afford to buy more expensive imported cars which have had a tariff imposed on them.

The adoption of a neo-Mc Ewanist policy paradigm by the Abbott government is about more than industry/sectoral assistance. The deeper issue is whether the current government will pursue a policy paradigm of value adding with regard to economic production and wage payments? Sir John Mc Ewan promoted public policy which added value not only for manufacturing but also to the agricultural sector and for sustainable wage rises via the operation of an arbitral industrial relations system which this Australian statesman wholeheartedly *supported.

(*Sir John Mc Ewan also endorsed immigration to Australia and he therefore probably would have been appalled by the race to the bottom that contemporary Australian politicians associated with the major political parties are now demonstrating by supporting the denial of entry to refugees).

The Abbott government is unfortunately demonstrating that it is ensconcing itself in an economic rationalist straight jacket by refusing needed industry/sectoral assistance to those who need and supporting a transition to a low wage economy which is bereft of viable manufacturing and agricultural sectors. Prime Minister Abbott can however still be a highly effective neo-Bonapartist by utilizing ministers such as Ian Macfarlane and Barnaby Joyce to implement viable industry/ sectoral assistance policies. Such a paradigm can be formulated by a mix of public policy formulation by the combined input from public servants, business people on the ground, farmers, trade unionists, bankers and academics.

Neo-Liberalism Causes Unnecessary Turbulence for Qantas

If a neo-Mc Ewanist public policy paradigm is to be adopted by the Abbott government then the advocacy of current Deputy Prime Minister and Transport Minister Warren Truss that Qantas should be denied government guarantees for any future loans should be ignored. It is ironic that Truss as the notional leader of the Nationals is arguing against neo-Mc Ewanist policies. This opposition goes against the very successful public policy direction of the second Menzies government (1949 to 1966).

Sir Robert Menzies realized that private enterprise often could not survive and prosper without strategic government assistance. Such government support far from being a manifestation of left-wing government intervention often helped private enterprise to survive and flourish. This was particularly the case with the so-called Two-Airline Agreement which the Menzies government forged in the 1950s.

The Two-Airlines Agreement helped ensure that the government owned Trans Australian Airlines (TAA) did not gain a virtual monopoly on domestic air travel which the Chiefly government had intended when it established this airline in 1946. Sir Robert Menzies refused to close down TAA so as to prevent a private domestic airline monopoly subsequently developing. Instead, the Menzies government made TAA give some of its airplanes to Australian National Airways (ANA) so that this privately owned airline could survive and later prosper.

Government regulation of the airline industry under the Menzies government via the Two Airline Agreement ensured that only TAA and Ansett Airlines (the successor to ANA) could operate in Australia’s domestic airline industry. A beneficial legacy of this government regulatory policy is that Australian airlines now have about the best safety record in the world. While Sir Robert Menzies’ economic rationalist critics would now sneer at the Two Airline Policy as an uncompetitive duopoly, they forget that Australia having two viable competeting airlines has generated a high quality of service. This phenomenon of high service standards and safety in the airline industry reflected the paradox of regulation leading to viable competition (‘secure competition’).

The onset of economic rationalism in the 1980s created a milieu where eventually the Two Airlines Agreement was formally phased out. However, the fundamental of Australia having a two-airline industry has continued with the two domestic airlines now being Qantas and Virgin Airlines. The dynamics of Australia’s airline industry were, and are such, that there has not been scope for a major third airline. This was reflected by the non-survival of Compass Airlines (1990 to 1993) and Virgin Airlines re-configuring from being a cut-price airline into the only viable competitor with Qantas contributed to Ansett Airlines’ ensuing financial collapse in 2001.

That Virgin Airlines is now threatening Qantas’s future viability is not so much a reflection of the latter’s capacity to provide an excellent service but that a level playing field does not now exist in the Australian airlines industry. Virgin Airlines has received crucial on-going financial support from Singapore Airlines (SIA), Eithad Airlines and Air New Zealand which own a majority of shares in this airline. These three aforementioned airlines are government owned so that they are in effect SOEs, giving Virgin Airlines a comparative advantage so that this airline can endure financial losses which Qantas cannot.

Indeed, in an Australian context, these three SOE airlines have provided Virgin Airlines with a domestic market with the customers they fly in from overseas to Australia, then domestically flying with the aforementioned airline. Overall, despite this dividend, there is no level playing field for Qantas. This is because there are three airlines (which are SOEs) which are providing invaluable financial assistance to Virgin Airlines, so as to fatally undermining Qantas. Furthermore, the restriction of landing rights in other nations to the Qantas subsidiary, the cut-price airline Jetstar, is also substantially contributing to Qantas’s woes.

Consequently, Australian federal government assistance should have been provided to Qantas, by Canberra guaranteeing bank loans for Australia’s national air carrier. The denial of federal government guaranteed loans for Qantas of approximately three billion dollars would have helped ensure that the Flying Kangaroo did not go the way of Ansett: a major airline financially collapsing because it lacks the capacity to adapt to a fundamentally changing *operating environment. Such Australian government financial support would not have constituted cheque book economics, because, with new capital, Australia’s national carrier could have repaid its bank loans enhanced capacity, helping generating greater profits.

(*Repealing the carbon tax would remove the impost for Qantas which has had to pay one hundred and six million dollars in taxes and over five hundred million dollars in fuel costs).

Instead of supporting Qantas, Prime Minister Abbott, seems intent on dismembering this airline by not only refusing to guarantee loans it may otherwise not obtain without Canberra backing, but also calling for the amending of the Qantas Sale Act, 1992 (the Qantas Act). The Abbott government amending the Qantas Act so that a domestic division of Qantas could be formed with majority foreign ownership creates the potential for other SOEs, such as Air Emirates, to have a controlling interest.

Should SOEs have a controlling interest in a new domestic division of Qantas, instead of Australian shareholders expecting dividend returns, a domestic collusive duopoly charging high ticket prices could result. A foreign SOE owned Qantas might endure initial revenue losses due to higher priced air tickets but this could help make way for a substantially more expensive domestic and international airline industry for *Australia. It cannot be over-emphasised that competition settings in Australia’s airlines can determine whether this industry is either relatively cheap or prohibitively expensive. Having the nation’s two major airlines’ domestic divisions both owned by foreign SOEs is a recipe for the latter option.

(*The air routes in the east coast of the nation are amongst the most lucrative in the world).

Another dangerous scenario should Qantas be denied the capital to compete against the unfair advantage that Virgin has due to foreign SOE support, is that even without the Qantas Act been amended, the Flying Kangaroo could still be ‘restructured’ out of recognition. The five thousand job cuts announced of Qantas workers and the wage freeze for existing workers could provide the impetus for an airline denied needed government guaranteed loans to reconfigure Australia’s national airliner.

Qantas, instead of receiving a government backing for loans, could instead have to downsize both its domestic and international operations. A practice of ‘wet chartering’ could even be extensively applied where foreign owned airlines adopt the Qantas colours and uniforms when they are leasing the brand name on a particular flight route. The practice could also be adopted where, due to code sharing, Australians buy a Qantas ticket but end up flying with another overseas airline.
Overall, the Abbott government’s refusal to either guarantee Qantas’s loans or have the Qantas Act amended are creating the conditions for this Australian icon to be dismembered. Already, the Abbott government has within six months of tacking office fatally undercut government manufacturing with regard to the domestic car industry that it is probable that the current federal government would not be adverse to the Flying Kangaroo becoming another fallen Australian icon.

Should the Flying Kangaroo go the way of Ansett, it should be stated here and now that culpability for such an outcome will rest solely with the ideological intransigence of the Abbott government which is not only bereft of the Menzies tradition but hostile to this former government’s still applicable philosophical approach. Taking the Menzies government’s secure competition philosophical approach into account, the regulation of the seat capacity which an airline is allocated by the government should be actively considered. Economic rationalists would probably scoff at the advocacy of government regulating the amount of passengers that an airline can have but this is a public policy practice which is applied by governments around the world.

Regulation of airline seating capacity is also in keeping with the tradition of the Two Airline Agreement where a regulatory framework paradoxically ensured that a high level of completion was sustained. As was the case with the previous pragmatic approach of the Two Airlines Agreement, operational adjustments concerning licensed seating capacity could be made by a government regulatory authority depending on the business circumstances. Overall, such a regulatory environment would be in keeping with the secure competition regime which, under the Two-Airline Agreement, had provided a high quality of service and mechanical safety. The contemporary dynamics are also such that having two viable competing airlines would help create conditions for competitive (i.e. lower) air fares.

If however, Prime Minister Tony Abbott opts for an unstainable laissez-faire approach to Australian airline travel, then not only the viability of this sector be imperilled but he could well be entrapping himself within a destructive economic rationalist policy paradigm. Even an economic rationalist such as Treasurer Joe Hockey is (or was) amenable to providing federal government guarantees for loans which Qantas may take out. If the prime minister is as strategically astute as Sir Robert Menzies was, he could utilize Hockey’s support for government guarantees for any future Qantas loans to establish a basis to support Industry Minister Ian Mc Farlane and Agriculture Minister Barnaby Joyce to apply neo-Mc Ewanist policies for their respective areas of ministerial responsibility.

Breaking with Economic Rationalism: The Nexus Between Mc Ewanism and Neo-Bonapartism

Ultimately, Treasurer Joe Hockey would probably acquiesce to neo-Mc Ewanist policy formulation so long as he has the power to achieve the paying off of Australia’s massive public foreign debt and budget deficit. The application of neo-Mc Ewanism is not necessarily financially profligate but rather a re-allocation of resources to ensure that Australia has an adaptable economic capacity in an internationally unbalanced playing field. A transition to neo-Mc Ewanism would endow the Abbott government with the neo-Bonapartist wherewithal to serve the genuine national interest.

Hopefully, Australian public servants will move away from the post-1983 paradigm of implementing neo-liberal theories which do not quite align with reality. Defenders of economic rationalism will undoubtedly point to the relative economic successes of the Howard-Costello era. However, when it is all said and done, this government was ironically (except in relation to industrial relations) less of an economic rationalist government than those of the Hawke-Keating era. The relative prosperity of the Howard-Costello era was crucially derived from its pragmatically shrewd engineering of the mining boom, the institution of highly effective prudential financial controls and paying off of Australia’s massive public foreign debt which the Hawke and Keating governments foolishly accumulated.

Economic rationalists will also point out to the irresponsibility of the Rudd government in squandering billions of dollars to chalk up a new massive public foreign debt by unnecessarily spending money on stimulus packages. However, the economic policies of the Rudd government, as engineered by its Treasurer Wayne Swan and Finance Minister Lindsay Tanner were orientated toward establishing a rentier state. Disturbingly, there is potential carry over by the Abbott government should it pursue policies which endanger the viability of the Australian manufacturing and the farming sectors to threaten wage levels and employee entitlements to help fatally facilitate an eventual fatal dependency on the PRC.

Joe Hockey can still be a successful treasurer by paying off Australia’s massive public foreign debt and returning the budget to surplus. Prime Minister Abbott can be a neo-Bonapartist political leader by giving Hockey a free hand to put Australia back into fiscal order while allowing potentially brilliant ministers such as Barnaby Joyce and Ian Macfarlane to promote value adding and employment generating neo-Mc Ewanism.

The amounts of financial industry/sectoral assistance to facilitate neo-Mc Ewanism that could be provided would be so relatively small that they would not adversely affect the budget bottom line. A reversion to tariff protection for the car industry would actually be a revenue raiser and the close links between the RBA and a possible RRDB would ensure that the structural support that Australian farmers would receive should be financially responsible.

Advocacy of neo-Mc Ewanism is therefore not only financially viable but it is in keeping with the socio-political traditions of Australian history. Sir Robert Menzies endorsed Mc Ewanism because it was in keeping with his overall objective of supporting a viable employment generating private sector. Indeed, Malcolm Fraser can win his current ideological debate against his former treasurer concerning the political legacy of *Sir Robert Menzies by arguing that the Liberal Party founder, in contrast to Howard, was a neo-Deakinite protectionist, who (despite some infractions,) essentially respected states rights.

(*Even though the federal Communications Minister Malcolm Turnbull hails from the traditionally free trade state of New South Wales, and in contrast to the staunchly monarchist Sir Alfred Deakin and Sir Robert Menzies, is a republican, he still offers Australia the best chance of reviving neo-Menzies socio-economic and political tradition. Malcolm Turnbull has a wide experience in business and politics combined with a cerebral mind such that the Menzies approach of being pragmatic without sacrificing underpinning principles could be adopted by him. To place matters in a succinct context, Malcolm Turnbull is the Liberal Party’s best hope of breaking with destructive neo-liberal economic rationalism).

Prime Minister Abbott can still achieve a Menzian balance between being fiscally responsible and economically interventionist by strictly allocating distinct spheres of responsibility to ministers who are ideologically at variance with each other. The skill required to achieve such a balance will not be easily achieved but it would be worth the intellectual challenge. It should be remembered that, even though Napoleon I was often away at battle, he still effectively guided French domestic affairs. This was because His Imperial Majesty was probably the first statesman in history to have a personal staff to implement his ideas and because he had a modern cabinet ranging from republicans to Legitimatists.

Napoleon I harnessed the ideological diversity within his regime to achieve highly effective governance which helped His Imperial Majesty bequeath a historical legacy which retrospectively vindicated his reign. Crucial to this success was Napoleon I being an independent political actor. There is scope for Prime Minister Abbott to similarly be an independent political actor by judiciously giving free reign to ministers with different ideological perspectives while still achieving an overall synthesis to produce effective government.

The apparent policy defeat that Barnaby Joyce and Ian Macfarlane have endured because Prime Minister Abbott supported Treasurer Joe Hockey and the Finance Minister Mathias Cormann by denying industry/sectoral assistance for SPC in Shepparton, even if economically correct, can be politically dangerous for the coalition because the Shorten-Plibersek team is heading in the opposite direction of committing itself to considered and sensible industry assistance and protecting the integrity of Australia’s pluralist industrial relations system. The ALP’s respective federal leader and deputy leader are both sufficiently articulate to highlight the dichotomy between their approach and that of the Abbott government’s policy direction so that Labor gains the paradigm shift it needs to reverse the political situation in Australia in its favour.

The Importance of Moving On:The Shorten-Plibersek Leadership Team

At the very least, the Shorten-Plibersek leadership team represents the ALP’s closure with regard to the turmoil of the Rudd-Gillard split. There had been however potential for the divisions of the Rudd-Gillard era to have continued to manifest within the ALP to the present. An important reason why this did not happen was due to Julia Gillard’s integrity during the 2013 federal election of refraining from sabotaging Kevin Rudd’s erratic election campaign.

Julia Gillard was probably not only loyal to her party for sentimental reasons but also because she had an ideological/philosophical success on in the person of Tanya Plibersek who could continue to fight for a moderate centre-left tradition in Australian politics. It may be true (as the British politician Enoch Powell said) that all political careers end in failure. However, ‘failed’ politicians can often redeem their legacies if they find a successor to fight on for the values which were the driving force in their own careers.

A major reason why *Malcolm Fraser was a failed politician was because he laid the ground work for an ideological opposite such as John Howard to eventually become Australia’s leader. Furthermore, former colleagues of Malcolm Fraser’s, such Andrew Peacock and Fred Chaney, who might have redeemed the Menzies-Deakin-Fraser tradition in the Liberal Party after Malcolm Fraser’s departure in 1983, were ultimately ‘bested’ by John Howard.

(*Malcolm Fraser was not however a moral failure as prime minister).

Julia Gillard, in contrast to Malcolm Fraser, has a protégé in Tanya Plibersek who has now moved into a leadership position where she can defend and advance the *Fisher-Gillard tradition within the ALP. Tanya Plibersek has a similar political background to Julia Gillard’s in that she was also involved in university student politics. A major difference between these two women however is that while Julia Gillard consciously rejected the anti-Americanism and an anti-Israel orientation which exists within the SL faction of the ALP, Tanya Plibersek has essentially and unfortunately endorsed these outlooks.

(*The great Andrew Fisher was a Labor prime minister of Australia between 1908 and 1909, from 1910 to 1913 and from 1914 to 1915).

It is with regard to domestic policy that Gillard and Plibersek are similar as they want to utilize public policy to improve the quality of people’s everyday lives and to expand opportunities to everyone regardless of their socio-economic background. This shared outlook may have been a reason why Julia Gillard disciplined herself during the 2013 federal election campaign in the expectation that Tanya Plibersek would subsequently become the ALP’s deputy leader.

Ironically, even though she is a notional member of the SL, Julia Gillard as a rank and file member of the ALP probably voted for the right-wing Bill Shorten in the 2013 leadership ballot and not that stalwart of the ALP Left, Anthony Albanese. Ironies continue to abound in that, although Kevin Rudd hails from the ALP Right, he voted for Albanese instead of Shorten. This would not be really surprising because a core support group of Kevin Rudd’s was the hard left of the SL which could not stand a comparative moderate in Julia Gillard becoming prime minister, particularly as she had previously bucked factional regimentation.

From a pragmatic perspective, an important reason why the hard left of the SL remained loyal to Kevin Rudd during his wilderness years (2010 to 2013) was to help pave the way for Anthony Albanese to succeed him as leader. A crucial factor which precipitated the ALP to change in June 2013 from Gillard back to Rudd was so that the leadership rules could be revamped to provide for rank and file party members having fifty percent of the vote beside the parliamentary caucus in electing the ALP leader. Under this scenario, Albanese stood a viable chance of being elected as ALP leader after the party went into opposition.

The Albanese camp also probably believed that they had a strong chance of winning the Labor leadership should parliamentary caucus members of the Right faction who had previously supported Rudd, such as Richard Marles and Ed Husic, crossed over to support their candidate. This was not to be, because members of the Right, including an array of sub-factional parliamentary groupings galvanized to support Bill Shorten’s election as leader. To have done otherwise would have caused the ultimate disintegration of the Right of the faction because Shorten has such a formidable network that encompasses the sub-groups which constitute the ALP Right. Indeed, it was members of the Left within the caucus who crossed over to support Shorten and have since incurred the private wrath of Albanese backers.

The Shorten-Plibersek leadership team needs to dispense with some of the baggage from the Rudd reinstatement such as having a sixty-five percent threshold for the election of an Opposition Leader and a seventy-five percent threshold for an incumbent prime minister! A return to a fifty percent threshold for the election of an ALP leader is elementarily democratic and logical.

The ALP will probably retain the fifty percent rank and file party membership vote which will mean that the Right will have to be more proactive and focused upon recruiting people into the party of a social democratic persuasion. In this context, the *ALP Right will have to articulate what is to be social democratic as opposed to being merely re-active against the ideological idiocies of the Left.

(* For the ALP to have a needed social democratic persuasion it is vital that links be maintained with trade unions. It was noteworthy that the News Limited (Murdoch) press indulged in journalist advocacy by misinterpreting the comments made by federal deputy ALP leader, Tanya Plibersek on the Australian Agenda program (Sunday March 30th 2014). She said that Labor Party members who are not in a position to join trade unions, cannot be made to do so. This logical perspective was then misinterpreted by News Limited journalists and writers by their saying that Ms. Plibersek advocated that the ALP sever its institutional links with the Australian union movement.

The misinterpretation of the Plibersek comment underpinned a general News Limited advocacy that the ALP ‘modernize’ by reforming party structures so that unions do not have automatic representation at federal and state party conferences. The ALP ceases to be a Labor Party once it forgoes institutional linkage with the Australian union movement. Union membership density may be below twenty percent, however their still being a party to the Australian industrial relations system is crucial to protecting wage levels and workplace entitlements. The substantial impact that unions are still having in an industrial and in a bargaining context can similarly continue in a political environment via their institutional links with the ALP).

An important reason why the ALP Right is not currently focused upon ideological formation is the near blind faith that exists in the person of Bill Shorten as ALP leader. While Shorten is a very impressive leader, it is inherently dangerous for a political party to have a messiah complex about their *leader. Even though the ALP did have such a complex about Bob Hawke as prime minister (1983 to 1991) he was still deposed by Paul Keating (1991 to 1996). A messiah complex concerning Keating developed in the ALP after he won the 1993 federal election against tremendous odds but he was to be voted out in a landslide three years later in a general election.

(*It could be argued that the Liberal Party had a messiah complex about Sir Robert Menzies. However, Menzies had to overcome an array of rivals to found the Liberal Party in 1944 and it was not until the mid-1950s that this prime minister had established an unassailable position as leader of his party).

A contributing factor to Keating losing the March 1996 federal election was because he believed in his own legend. Hopefully, Bill Shorten will not believe in his own legend but realize that he could eventually become an actual legend should he harness the talents of people such as Tanya Plibersek on the left and Tony Burke on the social democratic right. Alternately, there is a high probability that, if Shorten is not successful as Opposition Leader, he will be succeeded by Albanese. For this reason, elements of the ABC and the Fairfax press could be overly critical of Shorten and Plibersek to help establish the groundwork for an eventual Albanese succession.

Achieving a synthesis between the best elements of the left and right could be the magic that the Shorten-Plibersek leadership endows the ALP with to take this party to subsequent victory. However, the ALP should not necessarily ignore the maxim that it is governments which lose elections. This was certainly true of Julia Gillard who signed her political death warrant in late 2011 by passing legislation introducing a carbon tax when she had solemnly promised just prior to the 2010 poll that such a tax would never be introduced in a government which she led.

The Inherent Dangers of a Rentier State

Tony Abbott fully exploited the game theory advantage which Julia Gillard had dealt him by subsequently invoking the mantra that the carbon tax was ‘a bad tax based on a lie’. If only Julia Gillard had instead moved to introduce an ETS then her political creditability would have remained substantially intact so that she could have led the ALP to a possible election victory in 2013 based on her positive government’s achievements.

It should never be forgotten that it was the Greens’ opposition to an ETS which established the groundwork for the carbon tax and consequently Abbott’s 2013 election victory. Indeed, the Greens still do not seem to realize that their role in coercing the Gillard government to adopt a carbon tax in 2011 in lieu of an ETS, took Tony Abbott from being *unelectable on becoming Opposition Leader in 2009 to virtually unbeatable in the 2013 election.

(*Internal sabotage within the 2010 ALP campaign – and Abbott’s very disciplined campaign- enabled the coalition to make up considerable ground in that election).

Similar to left-wing elements within the ABC helping engineer Abbott becoming Opposition Leader against Malcolm Turnbull (who is a stalwart ABC supporter) in 2009 on the flawed premise that he was unelectable, the Greens role in helping fatally foist a carbon tax on the Gillard government has rebounded on them. If there was either a Gillard or a Turnbull government, there would not have been federal approval for the Abbot Point deepwater port whose utilization threatens the precious delicate ecological balance of the Great Barrier Reef in northern Queensland.

Indeed, if the Abbott government was to convert Australia into a rentier state, the nation would of course be overly dependent upon mining which would create the ensuing scope for massive environmental degradation. Nevertheless, the Greens still believe that billions of dollars in revenue can be raised from a dud super profits tax regime for the mining sector, even though the effect of such a policy would be to entrench the power of particular mining companies which, due to their strategic connection with the PRC, could legally minimize the tax they have to pay.

Despite the counterproductive nature of a super-profits tax regime for the mining sector, the Greens still probably believe that Sovereign Wealth Funds (SWFs) can be utilized to facilitate funding for public funding purposes. This lack of policy direction on the part of the Greens is linked to the mystery of why they initially opposed an ETS- by insisting that a carbon tax instead of an ETS be applied - when this party should have known that Prime Minister Julia Gillard’s capacity to win the subsequent federal election would be jeopardised by such a tax.

The overall question therefore is: what do the Greens really want? Do they want to become the new alternate major left party by helping to coerce the ALP into adopting *moronic policies so that Labor will continue to lose votes? Maybe the Greens want there to be an Abbott government so that ‘regionalization’ (sic) can be introduced. If the Greens have been double-dealing with the Abbott Liberals, they should appreciate that coalition strategists have a centre-right political force in the form of the PUP.

The PUP will assume the balance of power in the Senate in July 204. This should please a critical mass of the Australian electorate who are determined that neither of the major parties will have a working majority in the Senate. *Nevertheless, the PUP is gaining credibility as an independent political party even though it might be a coalition front.

(*Ironically, due to PUP’s role in being a centre- right counterbalance to the Greens, this party in the 2013 election helped save the ALP from electoral pulverization because there were many disillusioned Labor voters who gave Clive Palmer’s party their first vote and then preferenced the ALP).

It will therefore be interesting to see if the PUP will support neo-liberal legislation such as undermining employee workplace entitlements and Voluntary Student Unionism (VSU). So long as the PUP appears (or actually is) independent of the coalition, this party could be seen as a sensible third force alternative to the Greens.

As it is, the Greens have a lot to answer for, in helping to foist a carbon tax on Australia and in the process ensure that Tony Abbott won the 2013 federal election. It is therefore hypercritical of the Greens to have accused Kevin Rudd of breaking faith with the Australian people with regard to climate change policy.

(*The Greens do actually possess the potential to entrench themselves if the Liberals were to preference them in lower house seats in the inner city suburbs across Australia).

Indeed, Kevin Rudd did come through on his commitment to an ETS by putting up the necessary legislation in early 2010 only to have the Greens combine with the coalition in the Senate to vote this down. Although a genuine Direct Action climate policy is the best antidote to human induced climate change, it was still one of Kevin Rudd’s positive achievements that he put this legislation up because he was trying to keep faith with the Australian people.

The other two major positive achievements of Kevin Rudd’s times as prime minister were his apology to the stolen generation of Aboriginal children and his calling of the 2013 election for the 7th of September. Although Prime Minister Rudd may not have known it, bringing the election forward by a week was another positive achievement of his when he was prime minister. This was because Prime Minster moving the election forward averted having a referendum on recognition in the constitution of local government for funding purposes which may well have provided the framework to dismember Australian states.

That the Gillard government had agreed to hold such a referendum may have been indicative of it having lost its way to rent-seeking forces who seek to destroy Australian federalism. Kevin Rudd may have had only a small window of opportunity to advance the genuine national interest during his brief second prime ministership but he did so by aborting the* constitutional referendum.

(*Hopefully, the Abbott government will serve the national interest by not holding this referendum on constitutional recognition of local government for funding purposes. If coalition backbenchers want to avoid falling victim to the Indi precedent, they will have to stand firm in opposing this referendum being held so that the nation’s genuine national interest is safeguarded).

While Kevin Rudd’s election defeat in September 2013 may have been almost inevitable because of the turmoil that the ALP had previously experienced and scepticism concerning his suitability for prime ministerial office, he at least was not weighed down by ideological dogma as Howard had been. Howard lost the 2007 election not only because of internal sabotage but also because he was an ideological prisoner of certain neo-liberal policies, such as industrial relations.

With regard to industrial relations Tony Abbott can, in contrast to Howard, be a neo-Bonapartist by refusing to adhere to an Eric Abetz, Julie Bishop and Peter Reith agenda. If what Tony Abbott said about himself in the Howard government that he was in a minority of two within the then cabinet in opposing Work Choices then he should continue on in the same vein as prime minister by continuing to be a neo-Bonapartist on industrial relations. Furthermore, anti-union agitators within the coalition and newspapers such as The Australian cannot compel Prime Minister Abbott to pursue a low wage agenda which will only create public unease which could well cause the eventual end of coalition rule.

Australian Neo-Bonapartism Means Opposing Rent-Seeking

Policy areas where Tony Abbott is actually being a neo-Bonapartist which may see the coalition enjoys a long tenure in office include trying to repeal the Minerals Resource Rent Tax (MRRT) and the carbon tax. The MRRT’s replacement of the Resource Super Profits Tax (RSPT) which Kevin Rudd proposed in mid 2010 was a manifestation of Julia Gillard’s neo-Bonapartism. The proposed RSPT would have provided an unfair advantage to the mega mining corporations so that they could use their economies of scale and links to the PRC to minimize the declaration of profits which they could declare and would have to pay.

A further intended ramification of this type of dud super-profits taxation regime was to consolidate a mining oligopoly which was integrally linked to Australia having disadvantageous trading arrangements with a mercantilist PRC. Julia Gillard on becoming prime minister in June 2010 therefore advanced Australia’s genuine national interest by ditching the proposed RSPT. The MRRT (which applies to profits from coal, iron and ore) which was introduced in lieu of the proposed RSPT, while still unnecessary, at least removed the dangers of an oligopoly in Australia’s vital mining sector emerging.

Tony Abbott as Opposition Leader -at the time in 2010 when Kevin Rudd was proposing the RSPT-declared that he would fight such a tax with all his might due to the sovereign risk which this proposed tax posed to Australia’s vital mining sector. It is possible that Abbott was not really sincere in his avowed opposition to super-profits taxation in the mining sector because he probably knew how the mega mining corporations and the PRC intended to actually benefit from such a taxation regime.

Nevertheless, Tony Abbott as prime minister is now in a position to be a neo-Bonapartist by ensuring that a super-profits taxation regime for the mining sector never again poses a threat to Australia’s genuine national interest. In this context recent moves by the Abbott government to repeal the relatively harmless MRRT are still to be applauded because they are a step in the correct direction as would be preserving the integrity of Australian states.

The assumption of Julia Gillard as prime minister in late June 2010 was also a step in the correct direction because it helped orientate the nation away from a rent-seeking future by removing threats to the viability of Australian states. The issue of state’s rights was not clearly on the radar at the time of the Gillard transition but it was an important subliminal factor.

The then Finance Minister Lindsay Tanner was manoeuvring himself in June 2010 to become prime minister after a federal election was held that year so that he could subsequently dismember Australian states. Tanner at this time was raging against the financial excesses of the BER so that he could position himself to become prime minister by either deposing or easing Kevin Rudd out as prime minister after the 2010 federal election – an election which Abbott was prepared to throw (i.e. lose).

The political dividend for Abbott allowing Rudd to win the 2010 election and have a Tanner succession was that there could be bi-partisanship between the ALP and the coalition in dismembering Australian states via ‘regionalization’ (sic). A Tanner government, (which would have been a version of the Whitlam government on steroids) would have represented ALP interests in dismembering Australian states while the Liberal Party’s interests would have been advanced by the New South Wales coalition which was inevitably going to be elected in March 2011.

An important reason why federal ALP parliamentarians overwhelmingly rallied to Julia Gillard to replace Kevin Rudd was to prevent Lindsay Tanner from throwing dirt concerning the BER to secure the prime ministership after the 2010 federal election. Nevertheless, rent-seeking elements in both the ALP and the coalition collusively rallied to ensure that a hung parliament was elected so that Julia Gillard lacked the necessary leverage to be an independent actor in heading a minority government following the August 2010 federal election.

Because political leverage could not have been maintained by rent-seeking elements within the Liberals by allowing the ALP to possibly win a third consecutive term in 2013, internal pressure by Labor rent-seekers was placed on Julia Gillard just prior to polling day to declare that a government she led after the federal election would not introduce a carbon tax. Prime Minister Gillard knew that, unless she made such an unambiguous declaration, it could be arranged by powerful forces in the ALP for her to lose the August 2010 vote.

For all the contrived drama following the August 2010 federal poll due to the election of a hung parliament, it was inevitable that Julia Gillard would form a minority government so that she could be set for a fall either during the course of the parliamentary term (by being deposed by Kevin Rudd) or be electorally thrashed at the next federal poll. Either of these two outcomes was premised upon Julia Gillard’s coerced breach with the Australian people by breaking her promise never to introduce a carbon tax.

The Application of Game Theory Political Strategy to Facilitate Rent-Seeking

Tony Abbott’s preparedness to go into up to three years of opposition not only demonstrated tremendous self-discipline on his part but either an explicit or implicit appreciation of game theory. This is a strategic approach (i.e. game theory) which can be utilized in politics in a non-mathematical context whereby political opponents are manipulated to take a particular action which then cedes the advantage to their adversary.

The broken promise of Julia Gillard concerning a carbon tax was a manifestation of game theory which ceded an inherent advantage to Tony Abbott over a three year period (2010 to 2013). Julia Gillard’s strategic response was to try to provide as competent and as compassionate a government (‘government with purpose’) to re-establish faith with the Australian people so that she could win the 2013 federal election in her own right. Similarly, ‘nervous Nellies’ in the ALP forlornly hoped that generous compensation packages for the carbon tax would help win back an alienated electorate.

It was to be forlorn hope for the ALP that it could win the 2013 federal election because the Australian electorate is so utterly unforgiving of politicians who break solemn election* promises. There were still valiant attempts by the Gillard government to re-connect with the Australian people by introducing compassionate policies such as Disability Care and enhancing the quality of education via the Gonski funding model. However, subterfuge was also required for Julia Gillard to be able to win the 2013 federal election which she was just ethically incapable of adopting.

(*The exception to this rule was John Howard who won the 1998 federal election despite brazenly breaking the unambiguous pledge made in the 1996 federal election that a government he led would never introduce a GST. Howard got away with this broken promise because of the emergence of the One Nation vote in the 1998 election which was not supported by a coherent preferencing strategy. At the 2001 federal election, the Hanson vote was appropriated by the coalition manipulating events concerning the Tampa vessel).

States Rights: The Contemporary Game Theory Arena of Australian Politics

Nevertheless, Julia Gillard did strike a blow in late 2010 which may have constituted her version of game theory in terms of advancing Australia’s genuine national interest. After successfully forming a minority government Prime Minister Gillard scrapped the so-called Hospitals Funding Plan and returned all previously clawed back GST revenue to the states. These courageous actions by Prime Minister Gillard terminated the rationale with which rent-seeking/anti-states rights elements in the coalition had effectively brought Howard down in 2007 and had made Abbott Opposition Leader in late 2009.

The strategic benefit which Julia Gillard may have gained from fatally undermining the raison d’être of her Liberal Party opponents was tragically cancelled out by her almost simultaneously announcing the introduction of a carbon tax. Doubtlessly, the price that Prime Minister Julia Gillard had to pay was that of announcing that a carbon tax would be introduced. The rent-seeking elements within the ALP who forced this policy shift on Julia Gillard must never again be trusted with exercising either power or influence within Labor if this party is to ever have a chance of regaining office at a federal level.

Ironically, Tony Abbott may be the ultimate beneficiary of the ALP, (in its 2007–2013 period in government), not fulfilling the role of dismembering states. This is because Abbott now has the scope to leave the Australian federation intact with three tiers of government-federal, state and local government. The major threat to the continued viability of Australian states could ironically come from Liberal state governments (or a possible future Daniel Andrews led ALP state government in Victoria) pushing through local government to set the groundwork for ‘regionalization.

The threat of ‘regionalization’ (sic) is possibly reflected in a speech by speech by Elizabeth Proust, the former Chief Executive Officer (CEO) of the City of Melbourne and the former secretary of the Department of Premier and Cabinet under Jeff Kennett. In an article in The Age newspaper (Friday January 3rd 2014, Call for One Big Melbourne Council, page 6) Ms. Proust was quoted from her speech to the Planning Institute’s annual Kemsley Oration, as saying that Melbourne’s thirty-one councils should be amalgamated into one and that there should be two levels of government, national and regional with the abolition of state governments!

While it is to be hoped that the Proust speech is an ambit claim, her oration nevertheless is a possible indicator that the current threat to state rights could ironically and tragically come from Liberal Party state governments! According to The Age article former Liberal premier, Jeff Kennett believes that there should be a ‘dramatic expansion of Melbourne City Council’s boundaries’.

The local government amalgamation that occurred in the 1990s in Victoria under the Kennett government is not a policy process to be proud of. There was a need for a degree of rationalization with regard to amalgamating some unsustainably small local government authorities but this process went too far in Victoria. Too many financially viable and democratically responsive Victorian local government councils were swallowed up into Leviathans such as the Moreland City Council, the City of Port Phillip and the Shire of Mornington Peninsula.

The groundwork for local government amalgamation in Victoria had been set by the ALP in the 1980s by the state government of John Cain. The motivation for pursuing this policy was in keeping with the Whitlamite objective of concentrating power by establishing a new regional tier of government. Unfortunately, the succeeding Kennett coalition state government (1992 to 1999) shared a degree of sympathy for this objective of concentrating power and pursued local government amalgamation with alacrity.

Those in the Victorian branch of the Liberal Party (and other state branches) who support further local government amalgamation/‘regionalization’ (sic) because they may want to see a prompt transaction of business, such as project approvals, should realize that they are setting the scene for an institutionalization of power by the hard left. Tony Abbott as a student political combat veteran of AUS should appreciate that one of the reasons that that organization became so disruptively militant was because a range of staff positions for student activists was created. Similarly, local government amalgamation/‘regionalization’ (sic) will create a hard left oligarchy (which will include the Greens Party) that will be everlasting.

Unfortunately, the respective conservative state governments of Denis Napthine in Victoria, Mike Baird in New South Wales and Campbell Newman in* Queensland may inflict local government amalgamation/‘regionalization’ (sic) on their respective states. Hopefully, state ministers and backbenchers in the aforementioned states will be neo-Bonapartists by rallying to protect their states from dismemberment.

(*Queensland local councils are already substantial in size. ‘Regionalization’ in a Queensland context could still be inflicted by a constitutional amendment recognising local government so that there could be direct funding of these local government authorities).

Regionalization: Where Goes Victoria so too Does Australia

There is a strong chance that Victoria unfortunately will lead the way with regard to the onset of ‘regionalization’. This is because the groundwork for the dismemberment of Australian states was previously established by the Victorian Kennett government in the 1990s undertaking local government amalgamation. Due to Jeff Kennett’s continuing influence, the current Victorian Premier Denis Napthine (who belongs to the Kennett faction of the state Liberal Party) may support further *local government amalgamation as part of the process to later help facilitate regionalizatio on a national level.

(*The newly elected Tasmanian premier, Will Hodgman will be placed under pressure by rent-seeking elements within the Liberal Party to amalgamate his state’s twenty-nine local councils. Hopefully, the new premier will resist this pressure).

The scope for inter-factional Victorian Liberal Party support for local government/‘regionalization’ is there because the state Planning Minister Matthew Guy is from the Kroger faction of the Liberal Party but has cordial relations with the Kennett faction so that the two factions could move in a common direction with regard to setting the scene for helping to eventually abolish Australian states. While Premier Napthine (who has potential to be a neo-Bonapartist leader) has been an energetic, honest and disciplined state leader, this does not necessarily mean that he will not ultimately sell out Victoria’s interests by supporting local government amalgamation/‘regionalization’ due to inner factional party pressure.

An alternate scenario is that the Victorian Liberals will throw the November 2014 state election so that an ALP government led by Daniel Andrews can be formed. Under such a scenario, an Andrews’ government could represent ALP interests as the New South Wales and Queensland state governments with the support of an Abbott federal government undertake local government amalgamation/‘regionalization’. Such a policy outcome will be inherently disadvantageous to the non-ALP side of politics, particularly in Victoria.

Before local government amalgamation was inflicted on Victoria in the 1990s, many of the relatively small local government councils were predominately non-party political because interested everyday citizens had the inclination and capacity to be elected to local office. This scope was diminished, but not extinguished, as independent minded citizens (albeit with some difficulty) can still be elected to post-amalgamate Victorian local government councils. However, further local government amalgamation will further undermine the scope for independent representation because non-party local government candidates will too often lack the resources to win election to office.

The major beneficiaries of an absence of independent local government representation will be the hard left of the ALP and the Greens Party. Going by relatively recent political patterns with regard to existing Victorian local government councils, power will gravitate toward CEOs and other bureaucrats who entrench themselves into institutional government structures.

In the amalgamated council of the City of Port Phillip, local government bureaucrats and elected representatives from the areas of Port Melbourne and South Melbourne have supported planning arrangements which residents in St. Kilda have generally been opposed to. Residents in the outvoted areas of amalgamated local councils can consequently often give up on being involved in politics if they perceive that the system is stacked against them. Such withdrawals from politics are conducive to apathy which often bolsters *organisational oligarchy.

(*Organisational oligarchy is where power within a group is undemocratically entrenched. This phenomenon has often afflicted amalgamated trade unions, which due to an absence of union democracy, has crucially helped precipitate massive de-unionization).

Proponents of local government amalgamation/’regionalization’ on the non-ALP side of politics seem oblivious to how either newly or further amalgamated local government councils will entrench the power of the hard left in Australia. These ‘conservative’ proponents of local government amalgamation/’regionalization’ are enamoured of what they think will be the expeditious scope for new regional authorities to authorize lucrative tendering and/ or planning arrangements which will serve their commercial interests.

Local government amalgamation/’regionalization’ will therefore help bring out the corrupt worst in some members of the coalition parties and the Labor Right which will ultimately rebound on the overall right in the context of Australian politics. A consolidation of such a corrupt trend combined with an institutional entrenchment of the hard left will not bode well for Australia’s body politic.

Australian state governments are generally efficient and effective and deliver honest service delivery to the public. State government institutional structures are only impediments to rapacious business people and would-be political hacks. The honest quality of operations of state governments and their public services are also enhanced by the vigilance and institutional integrity of state auditor-generals.

The Napthine government at the very least is an honest one which has set high standards of integrity with regard to public governance. However, this government could still fall victim to the major problem which afflicts Victorian state politics- inter-party collusion in facilitating alternation of power. The seemingly entrenched Kennett government was brought down in the September 1999 election because elements in the ruling state coalition government supported pro-ALP regional/rural independents to help precipitate an upset change of government.

The Victorian electoral pendulum swung again in the November 2010 Victorian election with the Liberals led by Ted Baillieu narrowingly winning power. This result was engineered due to interparty collusion so that Premier John Brumby and his deputy could be swept away in favour of a new generation of leaders within the ALP who would facilitate ‘regionalization’ (sic).

Daniel Andrews is well positioned to become Victoria’s next premier because his sub-faction of the SL has the capacity to convert its local government base into a powerful regional tier of a dismembered Victoria. Andrews has a background in student politics as an activist in the Monash University (Clayton Campus) Labor Club in the 1990s. The Labor Club to which Andrews belonged to was (and is) affiliated to the SL of the ALP. Members of this club gained control of the City of Port Phillip in southern Melbourne in the late 1990s/early 2000s.

This SL control of City of Port Phillip endowed former and current members of the Monash Labor Club with a contemporary powerbase in Victorian politics and in the state public service. Consequently, a transition to a new regional tier of government in which states are virtually abolished will considerably enhance the power of those currently or previously associated with the Monash Labor Club. Indeed, political leaders such as Daniel Andrews could well be at the forefront of facilitating a shift to ‘regionalization’ (sic) because they already have local power bases which can be reconfigured as part of a new power regime.

The current state Opposition Leader (Andrews) could very well become Victoria’s next premier because elements within the ruling state coalition could ‘throw’ the election in the ALP’s favour to help facilitate ‘regionalization’. A Victorian Labor government could well set the ball rolling with regard to restructuring Australian politics. Most coalition state MPs in Liberal led states are probably inherently resistant to ‘regionalization’ (sic) because they naturally enough support states rights. However, once these state parliamentarians observe new Victorian based regional power bailiwicks being constructed, a combination of pressure from their factional warlords and a desired for localized power could well see state MPs becoming complicit in selling out their states.

Victorian Politics and the Future of Australian Federalism

Alternately, should there be an Andrews government elected in November 2014, which is a probable scenario given the Napthine government’s travails which are being caused by Geoff Shaw, the now independent member for Frankston, then moderate and democratic forces within the Victorian ALP will have to do all in their power to resist the onset of further local government amalgamation.

From a Liberal Party /National Party perspective, Premier Napthine will therefore have to ensure that there is *no internal sabotage within his party’s ranks in this election year. A close eye will have to be kept on the operatives at the Liberal Party’s 104 head quarters in Melbourne’s Lonsdale Street and in the branches. A tight rein will also have to be maintained with regard to what the Liberal Party as a corporate entity communicates to the media. Then again, then premier, Jeff Kennett was still not able to save himself during the 1999 election despite strictly regulating access to the media and being warned about the ALP targeting regional Victoria.

(*The Abbott government’s decision not to provide industry support to SPC Ardmona in Shepparton could have been part of a political strategy to ensure that the ALP wins the November 2014 Victorian state election so that a Daniel Andrews ALP government can kick-start ‘regionalization’ ).

Ultimately, Premier Napthine will have to make the case to powerful members of both the Kennett faction (to which he belongs) and the emerging Kroger-Andrews faction that it is in their interests that they win the 2014 state election. While it may seem absurd that a premier should have to appeal to senior members of his state party branch that they should attempt to win the next state election, it should not be forgotten that the prospect of access to regional largess under ‘regionalization’ is an inducement which is apparently difficult to forgo.

However, the Liberal Party as an operation is not orientated toward committed involvement in the local/regional tier of government because its middle class base is more at home with state-wide electoral politics. Should Premier Napthine manage to convince the powers that be within the Victorian branch of the Liberal Party that they should try and win the November 2014 state election, he will have to conduct a positive proactive campaign emphasising infrastructure projects and service delivery because Victorians expect much from their governments, particularly with regard to infrastructure.

Victoria the Garden State or the Infrastructure State?

Since the gold rushes of the 1850s attracted massive investment to Victoria, Victorians have had an expectation that their governments will utilize the consequent opportunities to build infrastructures. The building of infrastructures in the cities, regional centres and having an excellent transportation system (railways and roads) while also having a viable agricultural sector have been the inter-related drivers of Victorian prosperity since the 1850s.

Due to the importance of infrastructure to Victoria, it was therefore not surprising that one of the state’s most prestigious citizens was Sir John Monash. As Victoria’s most prodigious and prestigious civil engineer between the 1890s and the outbreak of the First World War in 1914, Sir John Monash was possibly the most important citizen in the state. His local prestige was such that, following the outbreak of war in 1914, Monash’s position in the University of Melbourne militia regiment was quickly converted into a senior posting in the Australian Imperial Forces (AIF). Serving on the Western Front in France, General Monash was soon recognised by the Allied governments as one of their most important commanders who subsequently made a vital contribution to victory being finally achieved in late 1918.

Appreciating Sir John Monash’s brilliance, the Victorian government appointed him as head of the State Electricity Commission of Victoria (*SECV) in 1920 and as Vice-Chancellor of Melbourne University in 1923. He exercised his responsibilities in these two very important positions with the distinction which was expected of him until his death in 1931.

(*The SECV was generally known as the ‘SEC’ in Victoria).

The SEC was a vitally important state government owned instrumentality which literally powered Victoria’s industrial capacity and helped underwrite the state’s agricultural sector by providing electricity from dams. The prestige of the SEC reflected the faith that Victorians traditionally placed in utilizing government owned instrumentalities.

Victorians held public owned instrumentalities in such high esteem due to their importance in facilitating their prosperity that a paradoxical contributing reason as to the success of the Liberal Victorian states government of Sir Henry Bolte (1955 to 1972) was its competence in administering public services such as the SEC and the Gas and Fuel Corporation. This success was a paradox because it was a Liberal government, which while supportive of private enterprise, gained prestige by also supporting the public sector.

Victoria as a state was known in political circles as the ‘Jewel in the Liberal Party Crown’ that it was almost as much of a shock to many Liberals that they lost the April 1982 state election to the ALP after twenty-seven years in office as had the federal Labor victory been when twenty-three years of coalition rule ended in late 1972. The reasons for the ALP’s victory in the April 1982 Victorian state election are varied but a contributing factor was the Labor promise that they (i.e. the ALP) would spend more money which was available.

In 1981, the Victorian ALP ran commercials depicting dollar notes wasting away in drains because the Liberal state government had ‘wasted’ money the financial resources it had. The Liberals did not effectively counter-punch that their having accumulated savings was a manifestation of their highly effective financial management which reflected that the state’s overall finances were in excellent order. Consequently, the ALP Victorian leader John Cain was able to ‘sell something for nothing’ to win power in the April 1982 state election.

The Cain government between 1982 and 1990 was the second worst in the state’s history after that of his successor, *Joan Kirner (1990 to 1992). The Victorian ALP in government did profligately spend money and for two terms in office (1982 to 1985 and 1985 to 1988) a majority of the public accepted that expenditures were well spent.

(*Joan Kirner as state education minister between 1988 and 1990 had already inflicted considerable harm on the education system by trying to undermine academic standards with the introduction of the Victorian Certificate of Education, VCE, for matriculating secondary school students).

There was nevertheless a degree of public unease that money was being squandered but this was off-set by the ALP making the Opposition Leader Jeff Kennett’s personality the issue of concern in the 1985 and 1988 state elections. After 1990,with the fiascos concerning the funding of the Victorian Economic Development Corporation (VEDC), Tricontinental and the collapse of the Pyramid Building Society, Victorians had had enough of the ALP government and so that they voted Jeff Kennett into office as premier in a *landslide in October 1992.

(*The landslide that Jeff Kennett won in 1992 was the passing of a minimum threshold of acceptance of the ALP when considering the doom and gloom that then prevailed in Victoria).

In terms of its achievements the Kennett government (1992 to 1999) was a hybrid. The positive achievements encompassed highly effective financial management with the paying off of the state’s then massive public debt, attracting business investment to kick start economic growth, running a series of public events, such as the Grand Prix to stimulate a confidence boosting t civic culture and undertaking freeway construction on a pay as you go basis to avoid accruing public debt. These positive achievements made the Kennett government the best government that the state has had since the Bolte era.

Alternately, the Kennett government was the third worst government in Victorian history after the Kirner and Cain governments. The debit side of the ledger was the virtual *abolition of the state’s industrial relations system, undemocratic local government amalgamation, mass school closures which seemed more aimed at hitting education unions then introducing needed economies, and curbing the powers of the Auditor-General. This government also privatised (‘corporatized’) public utility icons such as the SEC and the Gas and Fuel Corporation. There were also massive public sector redundancies, which, despite the expenditure excesses of the Cain-Kirner era, still went too far.

(*The abolition of Victoria’s industrial relations system, including the elimination of penalty rates, was negated by the transfer of Victorian employees to federal award coverage).

The Kennett government seemed driven by a determination to emasculate the public sector and destroy trade unions so that potential political power sources for the ALP would be eliminated. Premier Kennett did not seem to understand that Victoria is a state which, since the gold rushes, has been orientated toward having a substantial public sector with a wide range of public services. The genius of the Bolte government and to a lesser extent, Sir Henry’s successor,* Rupert Hamer (1972 to 1981) was the realization that a centre-right government could simultaneously support both private and public sectors.

(*Hamer morally forfeited his right to the title of ‘Sir’ due to his support for a republic in the 1999 referendum. This disloyalty vividly contrasted with that of Hamer’s successor as premier, Lindsay Thompson, (1981 to 1982) who remained steadfastly loyal to the monarchy).

Gaps with regard to political acumen on the part of Premier Kennett led to a situation where he aroused fierce opposition, if not hatred, while failing to develop a correlating countervailing support base to safeguard his position. Ironically, anti-Kennett Liberals and the ALP exploited latent discontent within the coalition’s support base by covertly helping regional independent candidates to help precipitate Premier Kennett’s *political demise in 1999. This strategy of supporting regional independents was undertaken because the Kennett government had taken for granted the support of rural Victoria.

(*Steve Bracks became premier (1999 to 2007) following Kennett’s political demise. Bracks crossed the line from being fiscally conservative to be a ‘do-nothing’ premier that retarded Victoria’s socio-economic development. The only real achievement of the Bracks government was to restore the powers of the Auditor-General.

During the Bracks era, the state Treasurer John Brumby did try to kick start economic development but was thwarted by the government’s inert ethos. Brumby as Bracks’ successor as premier (2007 to 2010) attempted to be proactive but Victoria never really took off under his leadership.

Brumby’s successor as premier (2010 t0 2013), Ted Baillieu also led a lacklustre government as the Liberals under his leadership did not really expect to win the 2010 state election. Baillieu’s successor as premier, (2013 - ) Dr Denis Napthine has shown potential to be a successful state leader but his ultimate test will be whether he saves his state from ‘regionalization’ by refusing to undertake any further local government amalgamation).

In politics, neglecting elements of your powerbase can be fatal when you have to contend with virulent opposition. This was the case in Victoria where the Kennett government’s attempts to crush trade unions paradoxically strengthened some unions. The public sector and education unions in Victoria have high membership rates which were a re-action against mass redundancies and the abolition of state penalty rates in the period between 1992 and 1993.

Similarly, the nurse’s federation, the police federation and emergency workers’ unions in Victoria have very high membership rates due to the memories of the Kennett government’s initial draconian policies. Ironically, the state public sector is (and will remain) overwhelming pro-ALP in sentiment due to the hostility that Jeff Kennett generated as premier. Consequently, Liberal governments such as Denis Napthine’s will have to mollify their public service to the extent that they will at best be politically neutral. However, it will be too much to expect the Victorian public service to be as enthusiastically supportive of Liberal governments as they were during the Bolte era.

Furthermore, because Victoria’s public sector, education and nursing unions have viable membership bases and an activist ethos forged during the Kennett era they have a substantial degree of industrial power and political clout which endures even during tenures of Liberal Party rule in Victoria. Should ‘regionalization’ (sic) be inflicted on Victoria by a Daniel Andrews government, then these powerful unions will have the capacity to insulate their power in a new regional tier of government to the detriment of the Liberal and National parties. Over a period of time, the bureaucracies which will develop in Victorian regional tiers of government will inevitably orientate toward the ALP because Labor is regarded as the party of the public sector.

There may be powerful figures within the Liberal Party who delude themselves into thinking that their power can be expanded within new regional bailiwicks should Victoria be dismembered as a state. This will not be the case because the critical mass of Liberal Party supporters is not orientated toward activist involvement at a local government level. There will of course be Liberal activists who will be attracted to the patronage potential of a regional tier of government but the voting public, particularly the support base of the two coalition parties, will not tolerate corruption in the long run.

The best course of action for the Napthine government would be to resist ‘regionalization’ (sic) by steadfastly desisting from any further local government amalgamation and by communicating to the Abbott federal government its steadfast support for existing constitutional federal-state relations. There still however is the question of whether the Abbott government will safeguard the integrity of Australia’s current system of federal-state relations.

It is sadly ironic that so-called economic rationalists within state and federal governments - who generally oppose industry assistance - will be at the forefront of creating new regional Leviathans which will be at the forefront of facilitating corruption. If there are Liberals who really oppose the perpetuation of a rent-seeking mentality, then they should safeguard the continued integrity of the Australian federation.

South Australia: The Festival State or the ALP Laboratory for ‘Regionalization’?

There are however worrying signs that rent-seeking elements within the Liberal Party are still colluding with similar elements in the ALP to facilitate rent-seeking. This was manifested in the recent South Australian election on March 15th 2014. The Liberals garnered over forty-eight percent of the primary vote that on a two-party preferred basis was over fifty percent of the popular vote. That the Liberals lost this state election was due to their failure to win a swag of marginal seats.

This failure to win these marginal seats could be attributed to monumental incompetence and poor strategy as Liberal Party resources were seemingly inexplicably focused on holding either safe blue-ribbon seats or taking safe ALP seats. Near the end of the campaign the South Australian Liberal leader, a clearly fatigued Steven Marshall, made the mistaken call on voters to vote for Labor!

Overall, the election result was one where a pronounced majority sentiment was in favour of a shift from a rusty Labor state government which has overstayed its welcome. This South Australian election result seemed similar to that of the March 2007 New South Wales state election where the coalition lost what seemed to be an unlosable election.

The underlying reason why the ALP prevailed in New South Wales in 2007 and in South Australia in 2014 could be because the Liberals deliberately lost those elections to help establish the groundwork for ‘regionalization’. Indeed, it is noteworthy that the Liberals in South Australia in the 2007 and 2010 federal elections were disciplined to engineer holding (i.e. sandbagging) marginal seats but not to win a sufficient number of seats to help the coalition win those two polls. For the September 2013 federal election, the South Australian branch of the Liberal Party made a strong contribution to the coalition winning that election by picking up seats.

Perhaps South Australian premier, Jay Weatherill knew that as the South Australian version of a Morris Iemma (i.e. a premier who knew he was going to win because the opposition were going to ‘throw’ the election) of the 2013 state campaign when he threatened to resign if outgoing federal ALP senator, Don Farrell was pre-selected for the state seat of Napier. Weatherill’s aversion to *Don Farrell entering state parliament could have been because he did not want a Labor right-winger to have a powerbase for when the ‘regionalization’ process is undertaken in South Australia.

(*The Labor left’s refusal to reciprocate a political favour is amazing. Had Senator Farrell not agreed to go from first place on the ALP South Australian senate ticket to second place, which incredibly he failed to win election, then Senator Penny Wong could not have won re-election as a senator. Despite this act of generosity, Senator Wong did not support Don Farrell transferring to the South Australian parliament when his candidacy was mooted.

Furthermore, Senator Wong moved to the hard left of the ALP by voting to depose Julia Gillard as prime minister in September 2013 in favour of Kevin Rudd. This action was probably undertaken by Senator Wong to help bring about the rule change of there being a rank and file party vote in the election of ALP leader to help Anthony Albanese’s chances of being elected to that position after the 2013 federal election).

The necessary prerequisites are now in place in a South Australian political context to help facilitate the application of ‘regionalization ‘on a national basis. Political balance (unless the ALP win the November 2014 Victorian state election) requires that there be at least one ALP state government in place so that there is a sufficient bi-partisan balance to implement ‘regionalization’. Any political frustration that South Australian Liberal powerbrokers may feel about not holding power in their home state will be negated by the independent member Geoff Brock holding the balance of power in the state parliament to help facilitate ‘regionalization’.

It is noteworthy that Geoff Brock has been appointed Minister for Regional Development and the Minister for State and Local Relations in the Weatherill minority ALP South Australian government. Consequently, it will be interesting to see if Mr. Brock helps facilitate ‘regionalization’ by undertaking local government amalgamation so that a new regional tier can be created.

Local government amalgamation is akin to union amalgamation in that this process will promote organizational oligarchy by creating too expansive an economies of scale which smaller independent political actors cannot adapt to. For a state such as South Australia which needs to have a viable state government to attract sustainable viable investment, such as in manufacturing, a ‘regionalization’ regime will be particularly detrimental to that state.

The potential to stop future local government amalgamation in South Australia seems very limited because the Weatherill government will undoubtedly implement this agenda after being granted a political reprieve with regard to unexpectantly (and undeservedly) winning the March 2014 state election. The conservative and moderate factions of the South Australian Liberal Party will probably support Mr. Brock’s application of local government amalgamation so that new rural based regional local government bailiwicks can be created for them. This development will be particularly welcome to the South Australian Liberal Party’s conservative faction because it has a strong political base outside Adelaide.

The conservative faction of the South Australian Liberal Party’s support was crucial to ensuring that Howard lost the 2007 federal election (even though this faction was supposed to be staunchly pro-Howard) and helping to ensure that Tony Abbott deposed Malcolm Turnbull as federal Liberal leader in late 2009. This long range commitment to ‘regionalization’ of the conservative faction of the South Australian Liberal Party will ironically probably come to fruition with a Labor left led government in Adelaide.

So-called conservative faction leaders within the South Australian branch of the Liberal Party may believe that new regional bailiwicks will also create the scope for economic trading zones to be formed which are linked to a mercantilist PRC. Therefore great care must be taken by pro-state rights federal and state coalition MPs to ensure that free-trade agreements which are negotiated, particularly with the PRC, do not facilitate trade conditions where untrammelled access to Australian primary resources is granted. Even though the ALP is in opposition at a federal level, political moderate Labor state and federal parliamentarians should also seek to protect Australia’s genuine national interest.

Indeed in a state context, all might not be lost if political moderates in the South Australian ALP who are supportive of Don Farrell exploit the narrow parliamentary majority of the Weatherill minority government has to frustrate local government amalgamation. Such a blocking action is a political necessity for Labor political moderate forces in South Australia because the SDA (to whom Don Farrell is aligned as a former state secretary) will not have the industrial and political capacity to adapt to a transition to a new regionalized regime.

The SDA has usually politically flourished in a context where there is a Westminster system in which this union has the institutional leverage within the Labor Party to gain parliamentary pre-selections. Should the political leverage of the SDA be undone, then the capacity of other moderate unions and political forces within the South Australian ALP will be politically compromised.

However, it just not from an ALP perspective, that political moderates in South Australia should oppose local government amalgamation and by extension ‘regionalization’. Genuine moderates and genuine conservatives within the South Australian branch of the Liberal Party should, as members of a party, one of whose central pillars is states rights, should oppose any moves toward local government amalgamation. Furthermore, the South Australian Liberals having a new Opposition Leader committed to state rights would mightily advance their political cause.

Because it will be challenging for a state based political party to oppose a ‘regionalization’ agenda, federal parliamentarians need to help out. It should not be forgotten that state governments who intend to sell out their states via local government amalgamation might be attached to a losing cause if the Abbott government is frustrated at a national level.

Pro-state rights coalition MPs can uphold the Menzies-Mc Ewan political tradition in a federal-state context by, by opposing, the Abbott government in the following policy areas:

- moving to a ‘Crowned Republic’
- local government recognition in the Constitution
- having elections to a constitutional convention
- federal clawbacks of GST revenue from the states and
- disadvantageous free trade agreements which cede to the PRC control of Australian raw materials and industries.

Will the Liberal Party Betray State Governments?

Centralist traitors within the federal coalition probably know that most of the coalition’s Canberra backbench is pro-state rights. Therefore these traitors will try to help ensure that ‘regionalization’ is ironically and tragically precipitated by turncoat state governments.

Due to internal threats of ‘regionalization’ (sic)/local government amalgamation coming from within state governments, state government parliamentary backbenchers will hopefully rally to safeguard the interests of their states even if it means standing up to would-be turncoat premiers and cabinets. It should never be forgotten, that although Sir Robert Menzies often engaged in polemical arguments with Liberal state governments (such as Sir Henry Bolte’s Victorian government) over constitutional sources of power, the Liberal Party founder was still a staunch defender of state rights. Liberal and National Party state and federal parliamentarians who want to remain true to the Menzies tradition will have a once- in-a- lifetime opportunity to do so by fighting for state rights.

Federal and state parliamentarians should also seek to counter a neo-liberal economic rationalist policy agenda which is counter to Australia’s genuine national interest. A narrative similar to the New Right condemnation of the *Fraser government’s (1975 to 1983) ‘failure’ to implement harmful neo-liberal policies will be resuscitated to pressure the Abbott government into pursuing detrimental economic rationalist policies. There will probably be an inevitable push from the neo-liberal right of the Liberal Party on Prime Minister Abbott to also pursue a harsh industrial relations policy.

(*Malcolm Fraser after departing office, with justifiable pride, pleaded guilty to ‘failing’ to implement an economic rationalist policy agenda when he was prime minister).

Prime Minister Abbott was bequeathed a wonderful industrial relations system in the form of FWA by Julia Gillard. The major remedial action that Prime Minister Abbott can take in regard to industrial relations over a long period of time would be to redress the balance with regard to composition of the FWC by making appointments to bench from employer backgrounds.

Overall, if Tony Abbott is to be a neo-Bonapartist or an authentic (Burkean) conservative (in the mould of the Anglo-Irish philosopher Edmund Burke, 1727 to 1797) he will hopefully uphold the Menzies tradition of fairness to all. In terms of being true to the Menzies tradition, the coalition parties will hopefully jettison the so-called economic rationalism of the Hawke and Keating era and which substantially carried over to the Howard government pursuing neo-liberal policies.

A major fallacy of the so-called economic rationalist policy paradigm was to pursue socio-economic policies which supposedly made Australia internationally competitive. The reality of such policies was that Australia’s domestic economic capacity was undermined and an unbalanced advantage was ceded to its international trading partners.

Abbott government policy intentions such as scrapping the carbon tax are positive indicators that there will be a limited break from over thirty years of self-inflicted public policy vandalism. Although Rupert Murdoch is probably correct in saying that the climate should be given the benefit of the doubt with regard to human induced climate change, indications from the United States are that an ETS is unnecessary. The Obama administration’s policies and those of some American state governments are being successful in lowering carbon emissions by encouraging local industry to adopt best environmental practice.

The federal coalition’s Direct Action policy in relation to climate change may have initially being propaganda orientated but, of such a policy is sincerely pursued with the involvement if committed bureaucrats and talented scientists, then Australia’s carbon emissions can be satisfactorily lowered. The benefit to Australia’s beleaguered manufacturing sector of a successfully implemented Direct Action policy cannot be overstated.

A successful Direct Action climate policy would be symptomatic of Australia breaking free from the self-defeating economic rationalist paradigm which would have been an anathema to Sir Robert Menzies and his Country Party (now National Party) counterpart, Sir John Mc Ewan. These statesmen, as believers in private enterprise, removed impediments to private wealth creation. For this reason, the Menzies government removed petrol rationing on coming to office in 1949 because it had been an impediment to a section of the middle class generating wealth for themselves and, in the process their capacity to generate consequent valuable national economic enhancement.

(*Sir John Mc Ewan served as Deputy Prime Minister between 1958 and 1971. As previously mentioned Sir John Mc Ewan and Julia Gillard are contenders for the category of Australia’s best deputy prime minister).

Contemporary ‘economic rationalists’ within the ALP such as Dr. Craig Emerson (who unfortunately served in the vital ministerial trade portfolio in the Gillard government) have publicly advocated the removal of trade controls on the import of cheap food even if this means fatally undercutting Australia’s vital agriculture sector. Emerson’s support- for the former ALP Tasmanian state government entering into a series of disadvantageous commercial agricultural agreements with a mercantilist PRC- is reflective of this former federal minister’s failure to advocate in favour of Australia’s genuine national interest.

Sir Robert Menzies and Sir John Mc Ewan as advocates of Australia’s genuine national interest appreciated that wealth could not be created in a vacuum. Consequently, from their perspective, there were times when government protection and/or assistance were required so that the private sector could facilitate the inter-related outcomes of wealth creation and employment generation.

There are still ample threats to wealth generation in contemporary Australia which an Abbott government must not only be vigilant against but should take appropriate action. Moves by mining companies to evict productive farmers from their properties to pursue coal seam mining or to allow PRC SOEs to buy lucrative agricultural concerns, illustrate that Australia’s economic position can either be doomed or redeemed by government policy.

Fortunately, federal government MPs (both Liberal Party and National Party) have successfully lobbied to apply official Foreign Investment Review policy guidelines to stop foreign takeovers which threaten to diminish Australia’s national economic capacity. Tony Abbott as prime minster has shown a capacity to be a neo-Bonapartist by apparently aligning himself with backbenchers who lobbied to ensure that foreign investment review *protection was applied to help safeguard the nation’s vital agricultural sector.

(*’Protection’ in this context did not mean tariff protection).

The 2013 Indi Precedent: A Warning to Federal Coalition MPs Who Do Not Support the Genuine National Interest

Tony Abbott’s capacity to be a neo-Bonapartist has arguably been bolstered by the defeat of Sophie Mirabella, the federal Liberal member for Indi, a regional seat in north-eastern Victoria, by the independent candidate, Cathy Mc Gowan. For all Mrs. Mirabella’s avowed policy positions of being pro-life and a monarchist, it was probably best for Australia’s genuine national interest that she lost her seat. The former member for Indi (2001 to 2013) was not so much a Burkean conservative but an Ayn Rand libertarian. As such *Mrs. Mirabella was not really suited to be the member for a regional conservative electorate such an Indi.

(* Sophie Mirabella demonstrated that she was not really a Malcolm Turnbull supporter by her resigning from the Shadow Ministry in late 2009 to help provide momentum for Abbott to become Opposition Leader.

Tony Abbott has been fortunate in that his predecessor as leader has loyally supported him as Liberal Leader and is a very competent Communications Minister who can effectively administer the National Broadband Network).

Sophie Mirabella as a senior minister in an Abbott government would probably have advocated an adversarial Work Choices type of industrial relations regime and the re-introduction of *VSU. Even though Mrs. Mirabella is an ideological libertarian, had she served as Industry Minister in an Abbott government, she might have adhered to a mindset that those “who are not with us are against us” by been selectively industry interventionist by not supporting unionized manufacturing plants. Despite this, Mrs. Mirabella might have also being an ideological neo-liberal by opposing policies which would not have safeguarded Australia’s vital agricultural sector such as possibly allowing liberalized cheap food imports.

(*VSU is a policy which attempts to deny financial funding to universities and other institutions of higher learning so that student unions cannot effectively function. The reality of this neo-liberal policy has been that vital services, particularly in regional and rural Australia, have been threatened and that the Liberal Party sacrifices potential talent because too much of its student wing abstain from constructive involvement in student politics. Opposition to VSU by federal coalition MPs is a litmus test of whether they support the genuine national interest).

The Mirabella defeat in Indi is also a poignant warning to Liberal and National Party MPs in rural and regional electorates not to take their mainly conservative constituencies for granted. Indeed, the 2013 Mc Gowan upset in Indi is not unprecedented. Rob Oakeshott and Tony Windsor having both served as National MPs in the New South Wales parliament in the 1990s as Nationals had the necessary credentials to be elected as maverick independents to the Commonwealth Parliament in the 2000s.

However, the support that Oakeshott and Windsor gave to the formation of the Gillard minority government in 2010 and their endorsement of the carbon tax may have indicated that they were more comfortable with the centre-left then a broadly conservative right. It is probably because these two parliamentarians were aligned to the centre-left that they lost their electorate’s support and did not recontest their seats in the 2013 federal election.

A political pattern could re-occur in Indi in which Cathy Mc Gowan, the maverick conservative- after defeating an incumbent who had neglected her base- ultimately shows herself to be a centre-left parliamentarian who later forfeits her electorate’s support. Because it is relatively early days with regard to Ms. Mc Gowan’s parliamentary career, it is premature to ideologically categorize her or make predictions concerning the outcome of her political orientation.

Nonetheless, the 2013 Mc Gowan victory in Indi is a warning to Liberal parliamentarians in regional/rural seats and all National Party MPs that the template has been established by which community based independents can win their seats if these parliamentarians do not effectively oppose neo-liberal socio-economic/economic rationalist policies. Perhaps, eventually, such regional/rural seats which are lost can be won back by the Liberal and National parties if the independents who win them are eventually perceived to be liberal-left by their constituents.

But why should the Liberal and National MPs in regional/rural seats get on the ‘roundabout’ of neglecting the interests of their constituents, to consequently lose their seats to maverick ‘independents’ and then have their respective parties eventually win the seats back from these independents after they have been perceived to be centre-left? Fortunately, most federal coalition regional/rural MPs now seem to be protecting their electoral bases by trying to safeguard the integrity of the agriculture sector be they threats from coal seam mining or PRC SOEs. The Abbott government similarly seems to be supporting the apparent neo-Bonapartist /Burkean conservative direction of its regional/rural MPs.

The federal Treasurer Joe Hockey does not however seem to be in sync with the apparent neo-Bonapartist /Burkean conservative orientation of the coalition’s regional/rural MPs due to his support for a disadvantageous foreign investment framework. Be that as it may, an ‘economic rationalist’ such as Hockey can still re-deem himself by paying off Australia’s massive public foreign debt and returning the budget to surplus. For all the Howard government’s failings, it did have one priority correct- the paying off of Australia’s massive public foreign debt.

The Vital Importance of the Abbott Government Paying off Australia’s Massive Public Foreign Debt

For all the pressure for which the Abbott government will be subjected to with regard to undertaking industrial relations ‘reform’ and supporting local government amalgamation/’regionalization’ (sic), the historical test by which this government will be assessed will be whether it pays off Australia’s public foreign debt and safeguards and/or enhances the nation’s source of national wealth to help facilitate employment growth.

The paying off of Australia’s national public foreign debt and returning the budget to surplus should be the priorities of the Abbott government because it is very possible that another Global Financial Crisis (GFC) could hit the world’s financial system with an indebted Australia now being acutely vulnerable. If Treasurer Joe Hockey is to have a commission of audit of Australia’s finances, this will ultimately be a productive exercise if the eventual outcome is the paying off of the public national foreign debt and a return to budget surplus as was achieved during the Howard/Costello era.

It may have been too harsh to condemn the *Howard government as Australia’s second worst government after Whitlam’s government considering its achievements of paying off the national public foreign debt. This government was also to be commended for establishing excellent banking prudential regulations so that the nation could withstand the 2008 GFC.

(*Then again, the Howard government’s anti-state’s agenda and reprehensible Work Choices industrial relations policy arguably makes this government’s record the second worst after Whitlam’s).

If Tony Abbott is to avoid the catastrophe of Australia being hit hard by another version of the GFC, then policy indulgences such as collaborating with turncoat state governments in undertaking local government amalgamation/’regionalization’ (sic), pursuing anti-union vendettas, applying VSU and his becoming a de facto minimalist republican (via adopting a ‘Crowned Republic’) should be avoided at all costs. Restoring the nation’s fiscal position will ultimately be the criterion by which Tony Abbott is assessed to be a failure or a success as prime minister.

With regard to fiscal policy, the Obama administration in the United States has been accruing a substantial revenue base without raising taxes. However, there seems to be little sign that this increased revenue is being utilized to pay down America’s massive public foreign debt. Time is of the essence that history may condemn President Obama unless he utilizes the opportunity to address his nation’s foreign debt when he has the opportunity to do so.

There is still alas scope for another GFC because adequate financial regulation is not in place due to executive-congressional gridlock to prevent new housing bubbles from forming. Some form of preventative maintenance via financial regulation is required in the United States. It is too dangerous to have growth in the United States’ Gross National Product, GNP, fuelled mainly by financial manipulation.

The Obama administration, Congress and the American financial establishment will hopefully focus on promoting manufacturing and innovation as the drivers of economic growth to put the GFC behind the United States and to avoid another financial disaster from re-occurring. The United States is however becoming economically stronger due to the Obama administration’s success in progressing toward natural resource independence. The percentage of which the budget deficit is a component of America’s Gross Domestic Product (GDP) is thankfully declining due to success in accessing domestic natural resources such as shale oil and in fracking. For the United States to build on recent economic successes, taxes could be raised so on the top margin so that there could be greater public expenditure on domestic infrastructure.

Increased US public spending on infrastructure, such as roads, can help stimulate commercial activity to facilitate economic growth so that the United States can finally overcome the legacy of the 2008 Global Financial Crisis (GFC). This paradigm shift needs to be undertaken as America’s Federal Reserve moves toward ending the policy of quantitative easing.

The United States is probably in the frustratingly paradoxical position of being ‘so close but so far’ with regard to developing the appropriate policy framework to overcome the still substantial impact of the 2008 GFC legacy. Similarly, for Tony Abbott to either to be a success or failure as prime minister will depend on the framework which he establishes in office. Therefore care should be undertaken with regard to the Australian government negotiating a FTA with the PRC.

Recycling Unequal Trade Treaties: Why Would-Be Rent-Seeking Elites Must Not Be Allowed To Betray Their Nation

Australia should not risk having a version of the unequal treaties which China was subjected to between 1842 and 1943 being imposed via an FTA. The vital importance of Australia not allowing a future FTA with the PRC to facilitate the fatal undermining of political and economic independence has been previously analysed in this article in the sub-section ‘Australia At The Crossroads’.

Indeed, the FTA that Australia negotiated with the United States in the 2000s was a misnomer because Australia already virtually had no trade barriers with America and Washington did not reciprocate with any meaningful trade concessions to Canberra. Whether the Japanese and Korean-Australian FTA will have similar structural flaws from an Australian perspective requires more detailed examination of those particular agreements. Indeed, for a nation’s interests to be undermined in the negotiating of FTAs there have to be political operatives prepared to fatally compromise Australia’s genuine national interest.

The nation has already experienced the discord caused by rent-seeking elements within the political establishment engineering the rise of Kevin Rudd as prime minister in 2007 so that the groundwork for the abolition of states and the imposition of a dud super-profits taxation system on the mining sector being imposed as part establishing a trading regime which was unfavourably tilted toward the PRC. Mega-mining companies utilized their influence on the AWU to have the Rudd government advocate a MRRT which ultimately would have endowed a mercantilist PRC with virtual control over Australia’s vital mining sector.

Because there were rent-seeking elements within the coalition which helped engineer Kevin Rudd’s rise to the prime ministership in 2007 to help endow the PRC with an ultimately unfair trading advantage over Australia, there is now an acute danger that these same domestic forces will again attempt to sell out the nation’s genuine national interest via an FTA with the PRC. Is Australia under the aegis of an FTA with the PRC to become that nation’s quarry with its SOE’s picking off the choice agricultural properties and mineral resources?

The answer to the above questions should be an unequivocal ‘no’! If Tony Abbott wants to be a neo-Bonapartist in the way in which Kevin Rudd abysmally failed to be, he should adamantly refuse to enter an FTA with the PRC. Let PRC SOEs do business in Australia but subject to the protections of Foreign Investment Review regulations which have the demonstrable capacity to safeguard Australia’s genuine national interest. For such a framework to exist, Australia should forego negotiating a FTA with the PRC. Alternately, if an FTA between Australian and the PRC is negotiated, the Abbott government must insist that Foreign Investment Regulations and current foreign ownership thresholds are maintained.

Australian advocates of a disadvantageous FTA with the PRC might point out the 1957 Australia-Japan Agreement on Commerce which facilitated lucrative trade between the two nations. A practical and moral difference with regard to this 1957 trade agreement - and an FTA with the PRC - is that Japan was then maturing into a democracy. As a democratic trading partner, Australian-Japanese commerce was underpinned by transparent business arrangements which made it virtually impossible for Japan to place Australia at an inherent trading disadvantage.

In a more contemporary vein, Tony Abbott himself has pointed out that Japan is Australia’s main friend in Asia. Although Australia undoubtedly desires cordial relations with the PRC, Canberra and Beijing cannot be real friends until the latter eventually becomes a democracy. Because the PRC is a dictatorship, coercive domestic controls can be applied to manipulate trading arrangements to disadvantage Australia. Already, due to the treason of ALP and coalition rent-seeking elements, a dud system of taxation for the domestic mining sector was almost adopted via a MRRT in 2010 which would have unfairly advantaged the PRC over Australia.

Ironically, the PRC will be disadvantaged in the long-run if Australia enters into a FTA with Beijing because this will help perpetuate a mainland Chinese dictatorship. A signal will be sent from Australia to China that it is alright to have unaccountable SOEs help drive Chinese domestic economic policy when such a direction will prove ultimately non-beneficial, to say the least, for the PRC.

Back to the Future? Is China Returning to the 1940s Chiang Kia-shek Crises?

The socio-economic direction which the PRC is headed toward is at best risky and therefore worthy of re-evaluation. The objective of government macro policy in a social and economic context is to ensure that, over the next generation, over two-thirds of the population live in urban areas. Incentives, as well as quasi coercive measures are being undertaken to encourage farmers to locate to newly constructed urban dwellings. Utilization of a massive and predictable source of Australian iron and ore is crucial to this colossal urbanization policy.

There is however an acute danger that the people who re-settle in new urban constructions will eventually find themselves either unemployed or underemployed which could lead to later severe social dislocation. To put it in very simplistic terms, poverty is caused when commercial and business activity fails to generate sufficient levels of employment which is adequately remunerated (i.e. paid).

The objective of the PRC’s current urbanization drive is to create an economic base which China’s massive and growing industrial growth can accommodate rather than being overly reliant on foreign trade. However, a strong agricultural sector which is self-sufficient and self-supporting is the real secret to China being able to soak up unemployment and underemployment and in doing so keep poverty at bay.

If the PRC transforms to a nation where two-thirds of the population live in urban areas, then socio-economic co-ordination - which China (even with a Leninist power-over political structure) is incapable of - will have to be attempted. The ultimate scenario will be too many people living in cities which, despite massive infrastructure spending, will not be commercially viable to generate sufficient levels of employment because artificially high levels of urban living will have been induced.

The scope now exists for another GFC because too many provincial governments in the PRC have taken out non-productive and non-transparent loans which have gone into dud projects such as the construction of non-inhabited cities. Even if electoral democracy is not yet introduced by the PRC’s elite at least in the mean time, let there be financial transparency and effective prudential banking controls in place so that mainland China and the world can avoid another inter-national financial disaster.

The situation - in which a future PRC could be faced with - might be similar to what Chiang Kia-shek was confronted with between 1945 and 1949, an inherently weak, China due to the KMT government causing an inflation spiral by substituting the currency of the collaborationist Chinese regime with an exceptionally low rate to benefit Chiang regime carpetbaggers. The PRC is in a potentially similar situation because too many of the SOEs and government financial institutions are not transparent with regard to operating within *appropriate financial settings.

(*For this reason it is vital that the PRC forgo the practice of having unaccountable shadow banks whose financial arrangements are not transparent).

PRC government financial and employment controls (which are hinged upon having a fixed currency exchange rate) are adequate in the short to medium terms to head off disaster - but the underpinning fundamentals are unsound. This is not to say that mainland China should become a laissez-faire market economy- far from it. The CPC crucially owes its rise to power in the 1940s to the grievous effects of capitalism gone awry. For this reason, the late Deng Xiao-ping, the architect of China’s economic transformation into an economic powerhouse, opposed his nation becoming a full market economy.

Deng laid down strictures that markets were to be encouraged but that the Chinese state would retain overall financial control by centrally directing the nation’s economic levers and that economic growth discrepancy between regions was to be avoided at all costs. Consequently, a hybrid market socialist system developed in which SOEs were formed by which government (public) capital was invested with private capital with the state retaining overall control.

These SOEs have been beneficial to China because the infusion of government funds have propped up businesses which have employed millions of people, therefore keeping mass poverty at bay. The socio-economic cost of SOEs will come when they undergo a massive collapse because the money trail which props them up collapses due to a lack of financial transparency.

Why Sino-Japanese Co-Operation Would Be Very Valuable

China will hopefully therefore undertake a transition from being a market-socialist economist to a coordinated market economy similar to Japan’s. In this context a strategic emulation by the powers that be in Beijing to apply the Japanese model with Chinese characteristics would not go astray. Japan is a nation which is a coordinated market economy where the corporate sector operates in sync with overall government strategy to sustain foreign trade and Japanese investment abroad to over compensate for this nation’s lack of natural resources.

Mainland China is not a nation lacking in natural resources but an overriding central economic authority is needed so that the economic welfare of a quarter of the world’s population can be catered for by strategic coordination. The Xi Jingping/Li Keqiang leadership which assumed the leadership of the PRC in 2012 probably has *ten years to lead the nation. During this time SOEs can be reformed to operate in conjunction with privately owned companies in accordance with the Japanese Keiretsu model.

(*Under the PRC’s 1982 national Constitution, the top leadership positions can be held for a maximum of two consecutive five year terms which are determined at both the congresses of the CPC and the National Peoples’ Congress, NPC).

Keiretsus are conglomerates of Japanese companies/corporations which act in unison with the strategic advice emanating from the Ministry of Economy, Trade and Industry (METI) due to the necessity of Japan maintaining an overall strong international trading position. The nation’s central bank, the Bank of Japan, has also fulfilled an historical but at times inscrutable role in maintaining the nation’s domestic and international financial position.

A post-war secret to Japan’s amazing success has been that non-party technocrats have been the real drivers of economic success by their determining public policy. This has contributed to the paradox of Japan, with some important interregnums, essentially being governed by the Liberal Democratic Party (LDP), which was formed in 1955) as a Dominant Ruling Party (*DRP).

(*The concept of a DRP has been defined and explained in other Social Action Australia articles).

The real source of power in Japan has been technocrats within the state bureaucracy who initially gained their position due to scholastic achievement from universities with rigorous academic standards. The power of these Japanese bureaucrats has been such that many of them have later been seconded to work within the private sector and LDP factions to help keep Japan’s coordinated economic system smoothly functioning.

The essential point that needs to be made is that power in Japan emanates from an elite whose power is based on educational technical competence. This ruling caste is therefore generally honest and flexible and can reconfigure as the circumstances require. The major ‘glue’ that keeps this establishment viable the provision of a sense of socio-economic direction which keeps a natural resource poor as Japan an inter-national economic super-power.

It would be wrong to argue that, because Japan has a shadowy ruling elite, that the nation is not a democracy. Japan is a genuine democracy because it has had since 1947 independent political actors and institutions such as free trade unions and a free press, democratically elected local government, a competitive party system and integrity with regard to its judicial system. These aforementioned factors have also been hinged together by the positive intangible of Japan being a democratic constitutional monarchy.

Neo-Confucianism and Neo-Bonapartism: Interchangeable Concepts

Mainland China, over the next ten years under the Xi Jingping/Li Keqiang leadership team and after, could apply a national generation of the application of game theory to ensure that there is a Japanese type of socio-political settings to ensure Chinese national unity and social harmony. The essence of such a national transition would be to apply the time-honoured Confucian ethic that tertiary scholars determine the nation’s direction due to their being honest and their power being derived from scholastic merit. The CPC already has a critical mass of university (both domestic and overseas) graduates within its ranks and in the state bureaucracy so that such a power transition is possible.

For the above transition to commence in the PRC, Sun Yat-sen’s concept of a Judicial Yuan (i.e. branch) as eventually successfully applied on the Republic of China (ROC) on Taiwan should be adopted on the Chinese mainland. Independent *quasi judicial tribunals, which could be a precursor of mainland China eventually having a fearlessly independent judiciary, could be established in the PRC so that corruption can be rooted out or to enable citizens to make independent complaints without fear of retribution. Such a process could help initiate a process by which power passes from CPC hacks - whose power is based either on family networks and/or corrupt patronage cliques - to honest technocrats.

(*The upper echelons of the PLA are paradoxically being integrated into senior decision making under the Xi Jingping/Li Keqiang leadership team while simultaneously being encouraged to be a professional institution. Armed forces personnel could be utilized to initially professionally administer anti-corruption tribunals. If the PRC is to successfully grapple with national challenges, then the nexus between corruption and the CPC organization must be broken).

Having power allocated in the Chinese state bureaucracy based on academic merit would help establish mores which could be applied to the corporate sector so that private sectors, SOEs and financial institutions are governed with transparency and honesty to insulate against possible financial disaster which comes with power being too concentrated in an unaccountable manner. It would probably be better for China if privately owned companies with transparent corporate arrangements took over from SOEs so that they did not become Leviathans which could fatally drain the mainland Chinese economy. However, SOEs should still be retained because they prevent mass unemployment by employing people and generating necessary economic growth.

There is also an urgent need for financial reform of mainland China’s banking system so that the lack of transparency that existed during the late stages of KMT rule in the 1940s does not re-occur. If urbanization is continued to be applied in the PRC as the twenty-first century progresses, then transparently and honestly run small to medium banks will be needed to generate necessary commerce to underpin inherent economic viability in newly developed urban areas, not to mention a hopefully still vital agricultural sector.

Decentralization with regard to banking would also be hopefully complemented by local government reform in the PRC. It would be too much to ask or expect that a single-party ruled PRC would or could make a transition to multi-party rule which is why it is so important that devolution at a local government level be facilitated.

The competitive non-party village elections which have been held in parts of the PRC could eventually be extended to all levels of local government. There would probably be pre-vetting of candidates by a central authority appointed by the National People’s Congress (NPC, the equivalent of China’s national legislature) that implicit factions within the CPC, its satellite parties, genuine independents and even the *KMT could run as ostensible independents in local government elections. This semi-competitive electoral system would be buttressed by devolving power to municipal authorities to monitor and ultimately regulate tendering and other business activities so that corruption can be stopped by preventative maintenance at a local government level.

(*The KMT has been allowed to re-establish branches in mainland China’s southern coastal provinces).

Already, too many PRC citizens are fearful of developers with CPC links evicting them from their homes to make way for rapacious building construction. Having transparent and consistent planning processes in place which are administered by popularly elected local governments, which are responsive to everyday needs will help conciliate millions of people with overall state authority.

There is also a need for the central government to take into account the needs of millions of so-called unregistered migrants who have moved from the country to the cities. Too many of these people fear forced removal from their dwellings or feel that they are treated as second class citizens. These unregistered residents need to be re-assured with a sense of security. Extending voting rights to them in competitive (if initially held on a non-party basis) local government elections and having such elected authorities represent their interests would be steps which promote social harmony.

Social harmony is being promoted by the Xi Jingping/Li Keqiang leadership team analysing the application of property ownership rights to farmers. The concession of such property owing rights would endow this vital sector of the Chinese economy with certainty and predictability. However, care will have to be taken to ensure that pre-1949 patterns of unequal land ownership distribution do not ensue so to avoid inequities which cause social unrest. Nevertheless, the development of a stable land owing agricultural sector could lay the groundwork in the next generation for an *agrarian political party to develop on a nationwide basis which would help cement national unity.

(*The largest party in interwar Czechoslovakia, 1918-1938, in terms of voting strength, was the Agrarian Party. This party’s support transcended ethnic divisions between Czechs and Slovaks and for a time the Agrarians even enjoyed substantial support among the Sudeten German minority).

Respect for Civil Society Makes for Civil Harmony

The Xi Jingping/Li Keqiang leadership team is already making moves in a positive direction with regard to easing the application of the One-Child Policy and phasing out the notorious Logai slave labour system in which possibly millions of Chinese are incarcerated. These steps are vital because they will re-assure the many people in the PRC who mistrust the state due to the application of coercive controls. This will also help the PRC state to conciliate with civil society groups.

Currently there is a trend in society to adopt the attitude of George Orwell’s fictional character Julia from his novel Nineteen Eight Four to assert themselves from totalitarianism by being socially free. The PRC state by and large has granted this social autonomy as part of a social contract in return for collective groups and individuals accepting one-party rule. A glaring exception to this approach has been the state persecution of the spiritual exercise movement Falun Gong.

Because Falun Gong organised a substantial demonstration outside the Zongnanhai leadership residential compound in Beijing in April 1999, the PRC state responded with a massive and on-going clampdown against this eclectic organization. The initial cause of this Falun Gong protest was this organization bristling at being subject to the strictures of the semi-official China Qigong Research Society. There are similar rafts of semi-official organizations which are utilized by the state to regulate civil groups.

This process of state regimentation of civil groups goes back to the CPC’s rise to power in 1949. Because the CPC had effectively harnessed the support of civil groups (‘the patriotic bourgeoisie’) to vitally help win the Chinese Civil War (1946 to 1949), the subsequent PRC state has had a subsequent compunction to regulate civil society. This approach has manifested itself with regard to organized religion with the PRC state establishing the Chinese Patriotic Catholic Association (CPCA), the Chinese Patriotic Islamic Association and the protestant Christian, Three Self Patriotic Movement.

The Chinese government’s desire to regulate religion probably goes back to nineteenth century European and American Christian missionary activities in China which many Chinese then and since equated with foreign imperialism. However, organized religion in China has matured to the extent that it cannot be manipulated from abroad to bring down the PRC. Even Chinese Catholics who remain loyal to the Vatican cannot be micro-managed from Rome. Indeed, it is an open secret that many of the priests and bishops of the CPCA are actually allegiant to the Vatican so that there is scope for a rapprochement between Beijing and Rome.

Due to the activities of Al-Qaeda the PRC state is probably very wary of Islam, or more the point, political Islam. However, Islam teaches that Muslims are obliged to be patriotic to the nation in which they reside. Al-Qaeda operates in an anarchistic vacuum and there no sign of that emerging in the Muslim areas of China or the Muslim minority (which include Han Chinese adherents) being disloyal to their country. Overall, hopefully, there will be a receding of PRC regulation of civil groups and organized religion as part of a process by which mainland China transitions to an organically unified nation in which all its citizens are allegiant out of respect rather than feeling coerced.

Respecting Minority Rights Means Respecting Everyone’s Rights

Because of the crucial importance of national unity, no mainland Chinese government or the People’s Liberation Army (PLA) will permit the regions of either Tibet or Xinjiang to secede. Such a block will be imposed to stop a precedent so Han China will not break up as has previously happened in Chinese history.

With regard to Tibet, the current Dalai Lama, Tenzine Gyastso, has recognised Chinese sovereignty over this region but, in doing so, has called for Beijing to grant his homeland genuine autonomy. It should not be forgotten that, between 1950 and 1959, the Dalai Lama in effect accepted PRC sovereignty over Tibet. In the period between 1950 and 1954 (which was arguably the PRC’s golden age because there was an overwhelming majority acceptance of its legitimacy by the people) the CPC in effect shared power with the ‘patriotic bourgeoisie’ which included the Dalai Lama.

That the Dalai Lama was compelled to flee to India in March 1959 was due to Mao Tse-tung’s erratically brutal behaviour. It is true that the Dalai Lama missed the boat during Deng Xiao-ping’s ascendancy (1978 to 1989 and from 1992 to his death in February 1997) to reach a modus operandi similar to that which Beijing reached with Hong Kong and Macau of ‘one-country, two systems’. Indeed, the PRC leadership’s stratagem concerning Tibet seems to be waiting until the current Dalai Lama dies so that a ‘reincarnated’ *successor is found who can be controlled by Beijing.

(*If it is impossible for the Tibetan government in exile to find a reincarnation, or it takes too long to do so (when time is of the essence)- of the 14th Dalai Lama, a fall-back position for the exiled government would be to reinstate the Phagmodrupa royal dynasty which was deposed in 1635. The current royal claimant is Prince Trichen who is very intelligent and charismatic.

His Royal Highness has cordial relations with the Dalai Lama and the Tibetan government in exile. The Tibetan exiles ultimately cannot control the decisions of the PRC but they can take steps to strengthen their internal situation by reinstating the Tibetan monarchy as a democratic hereditary constitutional institution).

However, the Tibetan people will never be content unless the current Dalai Lama - or his successor acceptable to the Tibetan government in exile - negotiates a political settlement which secures Tibetan autonomy. As the history of a constitutional Russia between 1906 and 1917 shows, political legitimacy cannot be fully attained and with it a capacity to solve a myriad of pressing problems, unless the interests of national minorities are also taken into account.

The current Dalai Lama is an intelligent and thoughtful man, whom Beijing in reaching an accommodation with could generate a further subsequent capacity to solve other national problems with. The same could also be said of Beijing reaching an accommodation with the *Uyghur émigré leader, Rebiya Kadeer, who has also declared herself committed to the territorial integrity of the PRC.

(*The Uyghurs also have a royal family which they should utilize for the purposes of promoting a sense of cohesion to help them reach a ‘win-win’ accommodation with the PRC).

The Need for Democratic Reform from Above in the PRC
The wide range of important issues which confront the PRC’s leadership can be dealt with by a combination of the Xi Jingping/Li Keqiang leadership team competently leading mainland China and formulating ‘win-win’ policies with the detail often being left to Zhang Dejiang, NPC Chairman. Hopefully, Zhang will be a neo-Bonapartist who will laterally address his nation’s challenge by the national legislature being a proactive institution.

As the corporatist Cortes in the latter part of Generalissimo Franco’s rule in Spain in the mid-1970s demonstrated, non-democratically elected national legislatures can still fulfil an important role in national politics which consequently helps smooth the way for a nation to become a constitutional electoral democracy. Currently, the local legislatures in Hong Kong and Macau are relevant examples of how a degree of political power can be devolved to semi-representative legislatures which are not democratically elected. While these two aforementioned legislatures could be more proactive, they at least provide a model by which the NPC could at least go beyond meeting once a year to merely rubber stamp CPC politburo decisions.

The NPC - by having a neo-Bonapartist Chairman, a more representative composition and a swag of specialist committees - could provide the leadership to pro-actively address issues ranging from anti-corruption oversight, judicial reform, having a pluralist industrial relations system, press censorship (in which the media in the initial instance have the right to expose corruption), autonomy for national minorities and local government reform. A revamped NPC could also be the incubator for future national political parties to later emerge in the next generation.

As mentioned above, an important area of concern for the NPC to address would be industrial relations, in particular trade union reform. It should be pointed out that labour relations is a key issue relevant to the continued viability of CPC rule. There are a host of independent (and illegal) trade unions which operate in the PRC. A Polish scenario in which communist rule is ultimately unravelled by labour unrest cannot be ruled out in the mainland Chinese context. Currently, high rates of economic growth coupled with vigorous suppression of potential labour unrest are keeping the CPC ahead in the race of maintaining its power. However, time and events could overtake the CPC if labour unrest was to one day set off a spiral of social unrest.

Proactive steps which could be taken by the PRC state (including the NPC which should have labour representatives) would be to inaugurate an industrial relations system ahead of time for mainland China. The All-China Federation of Trade Unions (ACFTU) - instead of being a transmission belt for CPC policies- could legitimately represent its members’ interests within a genuine bargaining industrial relations framework.

It should not be forgotten that, under the dictatorship of Saddam Hussein in Iraq in the 1970s and early 1980s and for most of the authoritarian period of the Marcos government in the Philippines between 1972 and 1986, trade unions had the right to represent their members’ interests in return for accepting the overall authority of these two respective regimes. A similar scenario could be applied in the PRC with unions being allowed to autonomously challenge employer authority should their members’ interests warrant such an action.

To pre-empt possible labour unrest, a pluralist industrial relations system could be formulated over a period of time by the NPC. The cornerstone of such a system would be having industrial tribunals (representing the state) which could handle employment matters in an even handed manner between employers and employees, which could encompass* ACFTU affiliates and independent trade unions. This arbitral approach to industrial relations could not only prevent industrial unrest but lead to bargaining outcomes which boost productivity and lead to overall better living standards.

(*An independent and strong mainland Chinese trade union movement could also lay the groundwork for a future nationwide social democratic party which could either be founded or the CPC could convert into).

Japan’s Win-Win Socio-Economic Model

The Japanese industrial relations system, whose unions are more often than not organised lines linked to an existing business, provides the PRC and the world with an example of how a cooperative industrial relations system can boost productivity and lead to improved working conditions. The affiliates of the Japanese Trade Union Confederation (RENGO) successfully represent their members’ interests and in doing so, somehow is part of the mysterious process by which a natural resource-poor Japan remains one of the world’s strongest economies as an international trading power house.

Due to Japan’s importance to the world and in particular to the possible future evolution of the PRC, it is a pity that this nation is currently led by a nationalist prime minister in the person of Shinzo Abe. Post-war history illustrates that Japan is more successful domestically- and influential internationally- when this nation *eschews nationalism which involves conflict with other nations.

(*Japanese diplomats who are amongst the world’s finest- should counsel their political superiors against their -i.e. the diplomatic corps - publicly engaging in propaganda against nations such as the PRC. Japanese diplomats should publicly praise their nation’s democracy and constitutional pacifism while refraining from making public comments which can lead to other nations potentially ‘losing face’.

Japan engaging in a diplomatic conflict with Beijing will help create a critical mass within the Chinese bureaucracy and military that will serve to abort positive reform from above and eventually lead to a lose-lose scenario with regard to Sino-Japanese relations, if not subsequently to the world).

The ultimate folly of aggressive Japanese nationalism was the disaster of the Second World War (1941 to 1945) and of the Sino-Japanese War (1937 to 1945). Japan’s ‘defeat’ in these wars was actually a blessing in disguise because it enabled this nation to dispense with the resources which were allocated to an inherently aggressive armed forces which committed war abroad in pursuit of obtaining natural resources and a grossly inequitable system of feudal land ownership.

The dismantling of Japan’s armed forces and comprehensive land reform undertaken during the American occupation (1945 to 1951) freed Japan from shackles which were crucial to its economic take-off. Ensuing prosperity came to Japan from its involvement in international trade. Ironically, and cleverly, post-war reparations payments were converted into a basis where Japan established lucrative trading agreements which provided her with crucial access to needed natural resources. Japan therefore benefitted from exercising its constitutional right to wage war and its subsequent emphasis on promoting international peace and cooperation because the post-war acceptance, which the Japanese gained, opened up invaluable trading and investment opportunities.

It therefore makes no sense for Prime Minister Abe to pursue the Diaoyutai Islands dispute with the PRC and compete with mainland China when it comes to entering into aid agreements to undercut the Chinese in Africa. There is much which the PRC stands to gain from a mutually collaborative relationship that the best course of action would be to wait out the period until Abe’s term in office ends so that, subsequently cordial relations can be forged.
How and Why The Friendship Association Could Actually Forge ‘Win-Win’ Sino-Japanese Relations

The Japan-China Friendship Association (The Friendship Association) could be utilized as a means of the PRC emulating - where appropriate- aspects of Japanese public policy which can be applied on the Chinese mainland. The Friendship Association was initially founded in 1950 by the Maoist regime to cultivate direct relations with Japanese community organizations as a result of Japan’s continuing diplomatic recognition of the ROC on Taiwan which lasted until 1972.

This association really served as a means by which the CPC maintained close relations with Japan’s official parliamentary opposition party, the Japan Socialist Party, (JSP). The Friendship Association fulfilled an important role by which Japanese governments up until the 1970s had a de facto agency which cultivated semi-official relations with the PRC. With the official establishment of diplomatic relations between Japan and mainland China, the Friendship Association, has since the 1980s, been a conduit in which resources have been passed onto Japanese left-wing peace groups to remind the Japanese of the war-time atrocities that their troops committed in the 1930s and 1940s, especially against China.

The Friendship Association could go the other way by changing direction from mainly having its activities in Japan to establishing a focus whereby Chinese branches of the association composed of government bureaucrats, NPC members and people from a range of NGOs became involved in forging official and semi-official links with the PRC. The benefit to the PRC of such linkages would be gaining insights and technical expertise in guiding mainland China’s transition from a *single-party state with a latently unbalanced hybrid socialist market economy into a co-ordinated market economy guided by impeccably honest technocrats who have links to future nationwide political parties in a multi-party system which will hopefully have a Dominant Ruling Party for an intermediate period.

(*The way in which the KMT on the ROC on Taiwan was adroitly transformed from being a Leninist party into a very successful democratic party - with still considerable financial assets - could also be analysed by Beijing policy makers).

There is also scope for the PRC’s elite to forge even closer ties with South Korea, the Republic of Korea (ROK) to facilitate political reform on the Chinese mainland. It is ironic that an anti-communist nation such as the ROK has such cordial links with the PRC.

The ROK can really make a positive impact in global affairs, by acting as a mediator between Beijing and Tokyo. However, the scope for this to occur is being undermined by the Abe government also engaging in a dispute with the ROK regarding sovereignty over Korean off-shore islands. This dispute has the potential to precipitate a ‘lose-lose’ scenario in Japanese-ROK relations. Considering Korea’s colonial past, there is no way that an ROK government is going to ever give way in such a territorial dispute. From a Japanese perspective, the alienation of ROK goodwill will not only undermine its relations with Seoul but also potentially help facilitate a ROK-PRC alliance against Japan when all three countries would immeasurably benefit by cordially co-operating with each other.

How Sino-Japanese Friendship Helped Redeem Chiang Kai-shek
The world has been such an immeasurably better place due to post-1945 American-Japanese friendship that the benefits of Sino-Japanese friendship cannot be overestimated. Indeed, for all his faults, Chiang Kai-shek always sought Sino-Japanese friendship and reaped its benefits when he retreated to Taiwan at the end of 1949. Due to Chiang’s humane treatment of Japanese personnel in China at the end of the war in 1945, a substantial pro-KMT sentiment emerged and developed in post-war Japan.

Chiang’s *successes with the ROC regarding Taiwan constituted a type of happy ending for him. But even had the PLA conquered Taiwan in 1950, Chiang’s life could still have had a relatively happy ending if he had taken refuge in Japan. As an émigré in Japan, Chiang and his wife Soong Mayling would have been treated as honoured guests. This would have been due not only to Chiang’s humane treatment of Japanese personnel at war’s end but also for his intervention to help ensure the preservation of the Japanese monarchy.

(*Chiang Kai-shek’s successes with the ROC on Taiwan were really those of his son, CCK who, similar to Deng Xiao-ping, was a neo-Bonapartist).

The KMT leader not only had successes with regard to forging cordial relations with a post-war Japan but also with establishing cordial relations with the United States. This achievement could be traced back to the 1930s when Chiang’s brother-in-law T.V. Soong established the so-called *China Lobby which encompassed protestant churches with missionaries in China, journalists (particularly those employed by the Time-Life magazines) and American congressmen.

(*The China Lobby metamorphosed into the also very successful Taiwan Lobby).

The China Lobby’s successes were impressive because its leading figures (such as T.V. Soong) had to overcome American isolationism and occasionally white racial prejudice against Chinese. In the 1930s, the widespread sympathy amongst the American public for the Chinese people and the KMT government was derived from the impact of American protestant churches which had a missionary presence in China, highlighting Japanese atrocities in China.

Nevertheless, it was not until after the Japanese bombing of Pearl Harbour in December 1941 that substantial American aid flowed through to Nationalist China. Unfortunately, in perhaps the main blot against Chiang Kai-shek’s public career, too much of this aid was not legitimately utilized by his regime between 1942 and 1945.

As previously mentioned the Generalissimo grievously failed during this 1942 to 1943 period to take the opportunity of accepting advice from his American military advisor General Joseph Stilwell to root out corruption in his armed forces and regime and to also undertake administrative reform. These failures of Chiang’s combined with his favouring his in-laws over the faction led by his capable son, Chiang Ching-kuo, set the scene for the subsequent communist victory in the ensuing civil war (1946 to 1949). Furthermore, the future President Harry Truman (who was a neo-Bonapartist) was alienated by the way in which Chiang had thwarted General Stilwell’s attempt to persuade Chiang to make needed reforms that his administration would hold back needed financial and military aid during the Chinese Civil War to what President Truman considered to be a hopelessly corrupt regime.

How The Russian Threat to Ukrainian Independence Illustrates the Non-Viability of American Isolationism

The irony of the appellation as the ‘man who lost China’ that President Truman’s opponents’ accorded him was that he probably saved the world from a Soviet communist takeover by instigating the Marshall Plan economic rescue package for Western Europe in 1947. The Truman Doctrine, which was also unveiled that year, provided military aid to Greece in her fight against a communist rebellion and offered assistance to Turkey in order to withstand Soviet bullying.

President Truman’s actions in helping Western Europe ward off a Soviet takeover also perpetuated the world’s division into a more or less free world and the Soviet bloc in a sustained standoff which became known as the ‘Cold War’. Victory in the Cold War was essentially won or lost out of which of the other side’s socio-economic system first collapsed.

For all the sense of triumph that the west won the Cold War - because the Soviet side collapsed due to the impact of Reagan administration’s (1981 to 1989) policies bringing the Soviet empire’s inherent weaknesses to the fore - it should not be forgotten that there were times when it seemed that the Soviet Union would win the Cold War. As American president Richard Nixon (RN) pointed out, the Cold War was an impasse in a Europe divided by nuclear weapons so that victory or defeat was to be determined in the Third World.

Actually, victory in the Cold War was achieved in Europe, when the impossible became the possible, with Central and Eastern Europe throwing off Marxist-Leninism in 1989 and Russia seceding from the Soviet Union in late 1991. Alas, President Boris Yeltsin in making way for Vladimir Putin in early 2000 not only ceded power to an authoritarian but someone who is determined to maintain a quasi-post Soviet Russian empire. The contemporary Russian Federation is testament to the pitfalls of a rentier state in which authoritarian power is directly derived from elite control of natural resources.

However, because contemporary Russia is a rentier state, the West now has the capacity to bring the Putin regime down by resorting to crippling sanctions. That is not to say that such sanctions should immediately be applied. However, coordinated European Union (EU) and American economic sanctions should be applied against Russia proportionate to the degree to which Putin escalates aggression against Ukraine. In summary, the West have to make the price too high in the short to medium term for Putin to try to undermine Ukraine. Why Putin wants to undermine his western neighbour is an interesting question.

From Putin’s perspective, a democratic Ukraine within the EU is a direct threat to his power. This is because, should the Ukraine prosper within the EU as a democratic state, then a precedent could be established which threatens the authoritarian regime which Putin maintains in Russia. If President Putin was really a neo-Bonapartist statesman, he would be reforming Russia to establish the groundwork for this federation to eventually join the EU and NATO as a mature and prosperous democracy.

Instead, President Putin is applying his wiles to undermine the emergence of a democratic Ukraine by both manipulating that republic’s Russian minority and pro-Russian elements in the east of the country. The Russian president is also prepared to use brute Russian Federation military power to undermine Ukraine. This preparedness is all the more dangerous because the Russian Federation has nuclear weapons which could be used if a full-scale war between the *Ukraine and Russia breaks out.
(*With the benefit of hindsight, it was a terrible mistake for the then Ukrainian government in 1994 to sign the Budapest Memorandum under which the Ukraine dismantled its nuclear arsenal which was then the world’s third largest. As a signatory to that agreement, Russia was obliged to respect and indeed defend Ukraine’s territorial integrity. Instead, Russia is brazenly violating Ukrainian territory. A salutary lesson to be learned from this particular tragedy is that nations under genuine threat should never forgo nuclear weapons when they possess such deterrence.

Thank goodness, that the West did not succumb to pressure from the pro-Soviet ‘peace movement’ to unilaterally disarm. Had unilateral nuclear disbarment been undertaken by NATO member nations in Western Europe in the 1980s, then there probably still would be a divided world with a threatening Soviet Union. Even though contemporary Russia still has a substantial nuclear arsenal which has the capacity to destroy the world, President Putin would still be overthrown in a military coup by his own armed forces if he were to order the use of nuclear weapons against Ukraine).

The *interim Ukrainian government must therefore move very carefully when asserting itself against the Russian bear. The situation is challenging for Kiev because wars are often (but not always) won or lost depending on planning. Putin’s Russia has had a long contemplated contingency plan for seizing Crimea where there is an ethnic Russian majority. The best approach for Ukraine’s leadership is to continue to verbally assert Ukrainian sovereignty of Crimea to keep up international pressure on Russia not to invade the east of their nation.

(*Hopefully, the interim government will ensure that presidential elections are held in May 2014 so that the election of a leader of the high calibre of the Ukrainian social democratic statesman Symon Petlura, the would-be Hapsburg king of Ukraine, Archduke Wilhelm or Mikhail Rodizanko, the Ukrainian parliamentary speaker during Nicholas II’s reign who led the monarchist Octoberist Party, will occur. Petlura was assassinated by the Soviets while he was in exile in 1926 and Archduke Wilhelm died in Soviet captivity in 1948 after been kidnapped in Vienna).

In keeping with the objective of depriving Putin of a pretext to invade eastern Ukraine, the interim government should demonstrate maximum restraint with regard to provocative pro-Russian demonstrations that occur within that part of the nation. This does not mean passively allowing pro-Russian elements with Moscow connivance to orchestrate secession. This threat can be countered by massive and peaceful pro-Kiev civilian demonstrations (which include pro-Ukraine ethnic Russians) taking place in eastern Ukraine and a proportionate military response.

The actual threat of an outright Russian invasion of eastern Ukraine would have to be countered by the Ukrainian armed forces in an outright defensive war. While the armed forces of the Russian Federation are probably more formidable than Ukraine’s, Kiev still has the necessary military capacity to fight a pro-longed defensive war which Putin would not be able to sustain in either a domestic Russian or an international context. The despatches of military advisory missions by NATO nations to assist the Ukrainians and of military hardware/technical assistance for defensive purposes are very positive developments because they will help deter Moscow from invading any more Ukrainian territory.

Another factor which might deter Putin instigated aggression against Ukraine is that while there may be overwhelming Russian domestic support for seizing *Crimea this will not necessarily translate into support for a prolonged war against Ukraine proper. This is because there are strong religious and cultural bonds between Ukraine and Russia. Putin is counting on these bonds in the belief that Ukraine’s armed forces will not defend their nation’s territory. However that is the point- Ukrainian troops probably could not initiate aggression against Russia but this reticence would convert into a tenacious capacity to defend Ukraine proper (i.e. excluding Crimea).

(*Crimea was a constituent republic of the Russian Federation until the then Soviet leader Nikita Khrushchev (who was a former Ukrainian party boss) transferred this area to Ukraine in 1954. This transferral was more nominal than actual because central power was then centred in Moscow due to the then overwhelming power of the Communist Party of the Soviet Union. Indeed, Putin himself probably would have allowed Crimea to remain within Ukrainian sovereignty when Ukraine was still more or less a vassal state of Moscow’s).

The best case scenario is for Ukraine to deter Russian aggression extending to eastern Ukraine by gaining international diplomatic support in the short-term and socio-economic and political integration with the European Union and NATO in the longer term. The latter outcome scenario would not only secure Ukraine’s long-term independence but create the scope for an eventual *Cyprus scenario.

(* The prosperity and political success of southern Cyprus, as an EU member, has led the predominately Turkish north of the island to seek re-unification with the south. A prosperous and independent Ukraine which is paradoxically integrated with the EU is what Putin fears most because this would serve as a beacon of light to the authoritarian rentier state which is contemporary Russia).

The current situation in Ukraine is very dangerous so a combination of short-term and long-term thinking is required. At the very least, the current crisis in the Ukraine should illustrate to most Americans the absurdity of their being isolationist. By the 1970s due to the manifestation of long-standing American isolationism- in the form of the ‘Vietnam Syndrome’, there was a high chance, particularly during the Carter administration (1977 to 1981), that the United States would lose the Cold War by forfeiting too much of the Third World to the Soviet Union. The Reagan administration however led a counter-attack against the Soviet empire which was also an internal battle against American isolationism which is the United States’ Achilles Heel.

The terrorist forces of Osama Bin Laden in the 2000s believed that residual affliction of the Vietnam Syndrome on the United States would provide them with the psychological edge over America to win their war to establish a Caliphate empire. In truth, the Vietnam Syndrome has see-sawed with regard to its impact on the United States since the September 11th 2001 terror attacks on American home soil.

The American public’s sense of war weariness concerning military commitments in Afghanistan and Iraq was an initial factor in the election of Barak Obama as president in 2008. President Obama could not completely militarily bail out of these two nations for the strategic consequences for the United States in an interconnected world would have been too grave. Nor however could the United States micro-manage a military victory in either Afghanistan or Iraq or remain indefinitely committed with regard to the deployment of troops.

The secret to the United States prevailing in Afghanistan, Iraq and elsewhere in the Middle East is to engineer having capable allies on the ground with the capacity to become self-sufficient. This in itself will be an evolutionary process in which there often will be no clear cut point at which victory can be perceived. In the earlier period of the early days of the Cold War, Germany was the major theatre of unarmed combat between the two super powers. Had the United States not had an able statesman in the person of the West German Chancellor, Konrad Adenauer, it might not only have lost Germany, but Western Europe and therefore eventually the Cold War.

The United States Walking the Walk: To Intervene or Not to Intervene to Support Democracy?

The other side of the coin with regard to American military involvement abroad is to decide whether or not to get militarily involved in another country’s affairs. This question is not one of direct invasion/liberation and ensuing occupation, as in the case of Afghanistan (2001) and Iraq (2003), but whether to provide support to freedom fighters on the ground as NATO did in the case of Libya in 2011. This question is specifically relevant to Syria where the United States has allowed this nation to almost fatally bleed to death with the outbreak of a civil war in 2011.

The Obama administration’s threat of military air intervention in Syria resulted in the Assad regime beginning to dismantle its stockpile of chemical weapons. This probably also occurred as the result of diplomatic pressure on Assad from an economically beleaguered republican Iran which may be seeking a limited rapprochement with the United States to overcome the imposition of sanctions.

It should be emphasised however that ‘limited’ is the best case scenario with regard to improvements concerning American-Iranian bi-lateral relations. The close alliance between republican Iran’s ruling clergy and the military is premised on anti-Americanism such that Tehran’s power structure precludes republican Iran ever fully reconciling with the United States.

Nevertheless, President Obama is correct in pursuing diplomatic negotiations with republican Iran regarding its nuclear programme so that overt military conflict can be provided. However, a review of previous American diplomatic dealings with republican Iran suggests that caution should be adopted by Washington. The Khomeini regime utilized the US Embassy Crisis of 1979 to 1981 to virtually destroy the Carter presidency and Tehran showed that it could not be trusted when it leaked details of the Reagan administration’s dealings with the regime to precipitate the Iran-Contra arms scandal in late 1986.

Accordingly, the Obama administration should not take republican Iran’s undertakings at face value. If the Iranian republican regime is discovered to be deceiving the world by utilizing the current negotiations as a ruse to develop nuclear weapons, then the United States should be prepared to use appropriate, if not massive, military action to prevent Tehran from doing so.

While the Obama administration is correct in publicly encouraging republican Iran to co-operate, private warnings to Tehran by Washington of the grave consequences should republican Iran covertly continue to develop nuclear weapons should be conveyed by the United States. This is because acquisition by the Iranian Republic of nuclear weapons would constitute the greatest threat to world peace since the 1962 Cuban Missiles Crisis.

Due to republican Iran’s potential to destabilize world peace, the United States is being remiss in not doing more to help the cause of Syrian democracy. Having a future democratic Syria would undermine Tehran’s capacity to threaten international peace. It is therefore frustrating that the United States has not instigated military air intervention as in Syria, which might have led to the formation of a capable provisional Syrian government. Such a transitional government could have organised multi-party elections to take this vitally strategically placed nation through to a lasting political settlement. Instead, the American reluctance to facilitate a political settlement in Syria has precipitated an Al-Qaeda insurgency in that nation which has spilt over into the Sunni parts of Iraq.

A key aspect of Al-Qaeda’s strategy is to create and exploit anarchist vacuums in nations which they target. It is therefore imperative for the United States not to allow such anarchist vacuums to develop because they also have a tendency to spread geographically. In such a context, the wise observation of the Renaissance political philosopher Niccola Machiavelli that political problems are akin to tuberculosis, easy to cure in the early stages but practicably impossible in the latter stages should be taken into account.

While the United States has allowed an Al-Qaeda insurgency to grow in Syria - and therefore Iraq - due to its refusal to militarily intervene with air power, the Syrian situation is not beyond redemption. This is despite the ominous development of ‘a civil war within a civil war’ where the Free Syrian Army is also fighting against brutal Al-Qaeda insurgents. However, the odds are still stacked against the Assad regime in the long run because the dictatorship has the support of only the three minority groups, the Alawites, Christians and Shiite Muslims.

Because these minority communities only constitute approximately thirty percent of the Syrian population, the Assad regime will eventually lose in a war of attrition, regardless of ‘a civil war within a civil war’ between the Free Syrian Army and Al-Qaeda affiliates. Therefore it will be important for western nations such as the United States to judiciously provide weapons to the Free Syrian Army so that it can counter Al-Qaeda affiliates and to compel the Assad regime to come to the negotiating table. Indeed, instead of having prolonged war, the Geneva II talks can redeem a seemingly hopeless situation by facilitating the formation of a provisional government - a coalition between the Baathists and the democratic opposition - encompassed within the Syrian National Council (SNC).

Should such a provisional government be formed, there will have to be foreign troops (hopefully from the Arab League) which will have to be deployed to help facilitate a merger between the Free Syrian Army and the Baathist regime’s armed forces. These foreign forces will crucially have to assist a merged Syrian army loyal to the provisional government to combat Al-Qaeda insurgents to help ensure that multi-party elections are conducted to produce a *democratic government.

(*The substantial Syrian minorities of Christians, Shia Muslims and Alawites can be protected against possible future retribution from the Sunni majority by the stipulation that a parliamentary government be formed by a two-thirds majority).

The Geneva II talks are important in facilitating the above scenario. However anyone who thinks that a political solution will be directly arrived at in these talks is delusional. The truth is that these formal talks are the ‘icing on the cake’ with regard to the overall task of arriving at a political settlement. The real action should be with regard to either the US State Department, the Arab League or a combination of the two finding the equivalent of a *Hector Garcia Godoy to lead Syria through a transitional phase to a democracy. President Obama, who is reputed to be a brilliant man, should be sufficiently adroit to take some action to end Syria’s immense suffering by precipitating a Hector Garcia Godoy solution.

(*Hector Godoy was the brilliant neo-Bonapartist who served as provisional president of the Republic between 1965 and 1966. His stupendous successes in this transitional role helped establish the groundwork for the Dominican Republic later becoming a first class democracy).

Prince Hassan bin Talal of Jordan would be an excellent choice to be a neo-Bonapartist transitional leader of Syria. His Royal Highness, similar to Hector Garcia, is an accomplished diplomat in his own right. Furthermore, the former Crown Prince is a convinced democrat who wants to see the Jordanian monarchy mature into a completely democratic institution).

Syria desperately now needs a neo-Bonapartist leader, even if from a neighbouring country, to preside over a transitional government. Hopefully, the SNC will strategically accept that the Baathists can have a future role in a transitional government. The SNC demand that Bashar Assad and his entourage exit the scene is a reasonable one considering the carnage which they have wrought on Syria. Consequently, arranging asylum for Bashar Assad and his associates will be an important aspect of the political settlement which the Geneva Talks will hopefully facilitate.

However, to reiterate the foremost priority with regard to the Syrian crisis (which could snowball into a crisis in southern Iraq) is for the non-Al Qaeda parties to the conflict (which includes the SNC, the Syrian branch of the Baathist Party, the United States and republican Iran) to thrash round until a neo-Bonapartist transitional leader is found to save Syria and possibly the Middle East from a spreading conflagration. Once this development has occurred, then the Geneva talks can be utilized to formalize the formation of a new Syrian provisional government and the deployment of an Arab League led military force to help stabilize the complex situation so that democratic elections can be later held.

The fall of the Berlin Wall in 1989, and the aftermath of the September 11 2001 terror attacks against the United States, which has helped give rise to this complex world. This situation is all the more hazardous due to the global strategy of Al-Qaeda. In this context, the saying that ‘life was not meant to be easy’ seems to be apt. However, as the rest of that saying goes, ‘but take courage: it can be delightful’ is also appropriate. In this context, courage is needed on the part of independent political actors (neo-Bonapartists) coming to the fore to lead, uninhibited by selfish vested interests.

Dr. David Paul Bennett is the Director of Social Action Australia Pty Ltd.