December 22nd 2012

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Articles from this issue:

FRONT COVER: Picture Credit

EDITORIAL: Hard landing likely for Australia's economy

CANBERRA OBSERVED: Julia Gillard's survival strategy for the New Year

WATER POLICY: Disastrous Murray-Darling Basin Plan is now law

ENVIRONMENT: Australia signs up for Doha cash grab

EDUCATION: Kirby attacks state aid to non-government schools

AUSTRALIAN SOCIETY: The left's long march through Australia's institutions

LABOUR RELATIONS: How to make unions accountable to members

POLITICS: The challenges that await Australia in the New Year

ENERGY: US to achieve energy independence in 15 years

ECONOMIC AFFAIRS: Time to reappraise the Washington Consensus?

OBITUARY: International advocate for family values dies

CINEMA: Well-crafted tale about an ageing pro

BOOK REVIEW A divided calling

BOOK REVIEW Atheist philosopher now sceptical about Darwin

POEM: Enlightened Willie's Prayer

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The challenges that await Australia in the New Year

by Peter Westmore

News Weekly, December 22, 2012

In this article, I want to discuss briefly the recent US election, the Chinese leadership transition and what it will mean for us, and to look forward to the 2013 federal election in Australia, which now looks as if it could be a lot closer than many expected even two or three months ago.

US re-elects Obama

In the US presidential election on November 6, almost every closely-contested state swung to President Obama, with the result that the vote in the US Electoral College was a convincing 332 votes to 206. Democrats who expected a close race were exuberant. Republicans were devastated.

However, in the cold light of day, it is clear that the US elections almost exactly restored the status quo. President Obama has been comfortably re-elected, but he faces a Republican-controlled House of Representatives with almost the same majority as before, and a Democrat majority in the Senate.

In other words, the American people voted to continue the impasse which had characterised relations between the President and Congress for the past two years.

The President’s first priority is to deal with the stalemate over the US Budget. For years, both sides have claimed that the Congress would have to cut the US deficit and, under laws passed previously, at the end of 2012 tax cuts will be abolished and cuts will automatically be made to US government programs.

While both sides have said that they want to compromise, Obama has insisted that high-income earners will have to pay more tax, while Republicans have rejected higher taxes and insist that other government programs must be cut, including President Obama’s expensive new Medicare program.

While some compromise could be reached, both sides are digging in for battle, and the uncertainty is paralysing the confidence of both US consumers and America’s trading partners, particularly exporters in Asia, including China.

On social issues, the re-election of the Obama administration will continue the destructive anti-life policies pursued by the President himself.

During the election campaign, President Obama announced his support for “same-sex marriage”, and in four states — Maine, Washington, Maryland and Minnesota — voters endorsed this stand.

While these states are the first in America in which voters have supported “same-sex marriage” — over 30 states had previously voted against “same-sex marriage” — the margins in the four state were close, 52 to 48 or closer, and each of these states is strongly Democrat and generally among the most left-liberal in the United States.

Another serious consequence of Obama’s re-election is that it will result in massive cuts in US defence spending, as Washington grapples with the deficit, and the war in Afghanistan winds down.

Despite claims to the contrary, this will reduce America’s commitment to its international peace-keeping initiatives, not only in north Asia where tensions between China and its neighbours could flare up at any time, but also in the Middle East, where American naval vessels have kept the peace in the Persian Gulf for years.

Little wonder that a senior US defence official expressed concern about Australia’s defence cuts before the recent defence talks in Perth (Sydney Morning Herald, November 10 2012). The world is becoming more unstable, and Australia’s own cuts to defence expenditure could make this even worse.

China leadership transition

At the same time that the leading nation in the Western world, the United States, was conducting a very public election for its President and Congress, the secretive Chinese Communist Party was negotiating the transition to a new generation of leaders in what is now the second largest economy in the world.

What can we say about the Chinese leadership transition? The starting point is to recognise that even the best-placed China observers can only make an educated guess as to what is happening.

We can, however, safely dismiss the claims by journalists that the new leadership of China is “shifting towards democracy” or “rejecting Maoism”, as some have claimed. Equally misleading are claims that the new leadership consists of “conservatives”, as some journalists have said.

The fact is that China is run by a one-party dictatorship of the Chinese Communist Party, and every one of its leaders has risen to power through its ranks. It is inconceivable that they would turn on the party which has given them careers, power and often incredible wealth.

On their way up the greasy pole, potential leaders in China are passed through many tests to ensure their utter loyalty to the party line. If any one of them were foolish enough to challenge the party’s monopoly on power, he would be unceremoniously deposed, as has happened to former Politburo member Bo Xilai, who this year has been deposed, stripped of all his offices and expelled from the party, and currently faces corruption charges.

Former citizens of the People’s Republic of China living in the West have utterly different views of what is going on. Is there a struggle around the continued persecution of Falun Gong? Was the leadership of retiring president, Hu Jintao, being challenged by a faction headed by the previous president, Jiang Zemin? Is the dominant faction in the CCP, led by Hu Jintao, using the corruption issue to campaign against the other faction? All of these could be true, fully or in part.

What we do know is that Hu Jintao is approaching the age of 70, which has been the approximate retiring age of Chinese leaders in the past, and the party wants to have leaders who are politically experienced, capable and approximately the age of leaders in other countries. We can certainly expect that the new leadership, led by 59-year-old Xi Jinping, will carry on the policies of Hu Jintao and the present leaders. I see the transition ultimately as an orderly change from the fourth to the fifth generation of Chinese communist leaders.

Consequences for Australia

With China’s economic growth slowing, and the probability that commodity prices will stall, there are damaging effects on investment in the mining industry — one of the engines of the Australian economy. The deferral of the $30 billion expansion of the Olympic Dam project is a clear sign of this, and its effects will flow through the Australian economy in 2013.

The European Union’s economies are on a knife-edge, because of the debt mountain of both governments and banks, arising from the global financial crisis. The riots seen in recent days in Spain and Greece are a symptom of this, and we can safely assume that there will be no early recovery of the eurozone economies, even if the euro currency survives in its present form.

These issues will play into Australia’s economy and the political environment in 2013.

Australian politics

I want now to discuss recent developments, then about what is likely to happen in Australia in 2013.

There has been a partial recovery in Labor’s position over recent months due to the sustained attack on Tony Abbott’s character; widespread hostility to the cutbacks imposed by state Liberal/National party governments in Queensland, New South Wales and Victoria; and people becoming accustomed to the impact of the carbon tax and the lower-than-expected impact of the mining tax.

Additionally, there is the factor of the clerical child-abuse scandal which is likely to play into the hands of Julia Gillard who has acted with authority, and against Tony Abbott. In the public mind he is associated with the Catholic Church whose reputation has been gravely damaged by the widespread allegations of sexual abuse and cover-ups which have come to light in recent times.

As a result, the pressure on Gillard coming from the Craig Thomson and Peter Slipper affairs seems to have diminished, at least for the time being. However, Gillard could lose her slim majority in the House of Representatives if either were to be convicted of a criminal offence.

In light of her bounce in the opinion polls, there is a strong case for Gillard to go to the polls some time early in 2013, when people are likely to be most favourable to her.

If the government runs its full term, there will be an election late next year or early in 2014.

The Labor government faces massive challenges over the next year, including its expected failure to deliver on its repeated promise of a budget surplus, the mounting federal and national deficits, Labor’s high-tax agenda, including the carbon tax and the mining tax, and its alliance with the Greens on a range of issues, social and environmental.

The Gillard government’s carbon tax of $23 a tonne of coal has already pushed up electricity prices for consumers, and can be expected to impact heavily on small business and job creation in the months ahead.

Since becoming leader of the Liberal Party in 2009, Tony Abbott has turned around the fortunes of the Coalition parties which, until his accession, had been divided and rudderless.

Since the 2010 election, he has effectively held the Gillard-Greens alliance to account over an extended period, but now faces major challenges, exacerbated by his continued low personal ratings in the polls.

Additionally, there is opposition to him from free-market think-tanks and media, and from sections of the business community, many of them wanting a continuation of the economic agenda which has been profitable to them over the past 30 years, but which has acutely damaged manufacturing and agriculture in Australia.

Bob Santamaria used to ask the question, paraphrasing Lenin, “What is to be done?” It is the question which we must address, in the run-up to the forthcoming elections.

First, we must support the Opposition leadership at this critical juncture, for a range of reasons. As you are aware, Tony Abbott has been utterly consistent in the debate over the definition of marriage.

Australian Marriage Equality and other supporters of same-sex unions in Australia have already flagged their intention to engage in a renewed push.

The French Socialist government of François Hollande has announced that it will introduce “same-sex marriage” legislation, as has the UK’s Conservative prime minister, David Cameron.

These moves will ensure that the campaign here will continue. The push for state-based legislation supporting “same-sex marriage” could have success in NSW where Premier Barry O’Farrell has offered Liberal MPs a conscience vote on the issue.

Despite this, at the national level, a vote in the Australian Parliament is unlikely to succeed — at least while Tony Abbott leads the Opposition. The campaign to replace Abbott, the most successful Liberal leader since John Howard, must be defeated.

Second, we must hold to account those people who have supported the legalisation of “same-sex marriage”, in the way that at Victoria’s last state election we held to account those who supported the state’s infamous abortion law.

Supporters of Victoria’s extreme abortion law were opposed in around 20 marginal Victorian seats, and 12 were defeated, changing the government. The same type of campaign must be conducted in the next federal election.

Third, we must continue to oppose the reckless and dangerous policies of the Greens. Despite their claims to being the “third force” in Australia, people have begun to wake up to their extreme anti-life, anti-business, anti-agriculture and high-tax policies.

We must hold the Greens to account for their policies, and encourage people who want to register a “protest” vote not to give their preferences (or their primary vote, for that matter) to the Greens.

For voters who do not wish to support one of the major parties, there are other parties, including the DLP, Australian Christians and Family First, which represent Judeo-Christian values.

The best way of reducing the impact of the Greens, who want to become a governing party, is to show what this party truly represents: they may be Green on the outside, but they are “red” on the inside.

And finally, we have to make the positive case for a renewal of Australia. We must:

• Continue the fight for the family, on every front, from the taxation system, to maintenance of the baby bonus, to defence of the family.

• Rebuild Australian manufacturing and industry, particularly small and medium enterprises (SMEs), which are closing down at an alarming rate.

• Support Australian agriculture, not only through giving farmers control over the sale of their produce off-shore, but also in building infrastructure, including dams, grain silos, bulk-loading ports and appropriate transportation.

• Maintain our defence capability, including the ship-building industry which is currently under threat in South Australia.

• Protect Australia’s economic sovereignty, in relation to overseas takeovers of our mineral resources and strategic companies, and the acquisition of our farmland. The superannuation industry needs stronger incentives (in the form of tax concessions, particularly) to invest in Australia and provide working capital for our businesses.

In conclusion, we can say that 2012 was a year of great challenges and our organisation, the National Civic Council, played an important role nationally in meeting them. Next year will be one of even greater challenges, and I look forward to joining with our supporters to face them.

News Weekly wishes its readers a very happy Christmas and New Year.

Peter Westmore is national president of the National Civic Council. 

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