Only in Australia – Peter Costello

I have a cupboard full of National costumes at home. They are garments I picked up at APEC Ministerial Meetings over more than a Decade. I have a Batik shirt from Indonesia, a Chinese silk smoking Jacket, a Barong shirt from the Philippines, a Canadian Ice Hockey Jacket and many others. Each was custom tailored and given to me to wear for an official APEC photo. I guess the idea is to emphasise the unity of the APEC region. After the meeting the costume is yours to take home. But what to do with them?

When it came time for Australia to host APEC, our officials spent as much time thinking about how we would deck out the Ministers in distinctively “Australian” costumes as was spent on any other part of the Ministerial meeting. Not only did we have to think about what an Australian costume would look like but we had to find one that was made in Australia. Imagine the glee of the press if it turned out that Australia’s national costume was made in China! In the end we opted for an RM Williams shirt for the Finance Ministers and a Driza-Bone for the Leaders.

Driza-Bone boasts that for over 110 years it has been part of Australia’s rural heritage. Both it and the RM Williams brand are part of the bushman legend. Australians, according to this view of ourselves, live on a vast and forbidding Continent which has shaped us to be tough, resourceful and independent- people like RM Williams- who can make coats from ship sails and riding boots tough enough to tame the brumby.

It was not only a case of decking out the Ministers to look uniquely Australian that stole so much of our officials’ attention. It was also necessary to put on distinctive national entertainment for them to enjoy at the official Dinner when they were decked out in our national clobber. I set on a singer who, we thought, would be very distinctively Australian and asked him to sing a distinctively Australian song. It was John Williamson and the song is True Blue.

True Blue, is it me and you

Is it Mum and Dad, is it a cockatoo

Is it standin’ by your mate when he’s in a fight

Or just Vege-mite

True Blue, I’m a-asking you

Hey True Blue, can you bear the load

Will you tie it up with wire

Just to keep the show on the road

Hey True Blue

Hey True Blue, now be Fair Dinkum

Is your heart still there

If they sell us out like sponge cakes

Do you really care

Hey True Blue

True Blue, is it me and you

Is it…

What I did not know then, or rather what I had not conceptualized in my thinking was that:

“There are several contrary diagnoses of the condition that lies beneath Australian exceptionalism. The most popular turn on the alleged slightness of vertical relations (“egalitarianism”) and the supposed thickness of horizontal ones (“mateship”)”; and

“Why these social arenas were atrophied or hypertrophied was typically then traced …[to].. either an enduring physical reality, or some cultural legacy of Australia’s historical origins”

I had not thought about this question of “Australianness” in such a penetrating way because the book Only in Australia had not yet been written and I had not had the advantage of reading it, in particular, Coleman’s own Chapter “Theories of Australian Exceptionalism” which I have just quoted.

John Williamson is a country boy who sings in a broad country accent. His song might be reflecting the fact that an era of reliable and honest characters (like the people you find in the country) is passing and it is strong on the mateship theme. We’re all in this together: me, you, Mum, Dad-and there is a chance that “they” will sell us out like sponge cake.

That’s the thing about being True Blue – as if it isn’t hard enough to battle the land-someone is always liable to get you. It might be the bosses or it could be those economic rationalists de-regulating orderly price schemes or it could be the British High Command sipping tea at Suvla Bay. That’s why you need your mates.

“Mateship” feeds easily into the ideas of fraternity and socialism. But it is not the exclusive preserve of the Left. When John Howard wanted to insert a Preamble into the Australian Constitution in 1999, the phrase he cherished most was “mateship”. Had his preferred Preamble been adopted, and had the Referendum succeeded “mateship” would have been raised to a Constitutional descriptor of “Australianness”. Ironically it was the left of politics that refused to accept it in the wording of the proposed Preamble and the electorate, mostly for conservative reasons, that voted the referendum down.

This book consists of chapters written by thirteen distinguished authors who each write about something that makes Australia exceptional or different. Geoffrey Blainey sees it in the rising of the seas that cut the country off from land bridges and isolated it from other civilisation. William Coleman sees it in electoral idiosyncrasies like the secret ballot and compulsory voting. But if there is a common theme linking all the contributions about what makes Australia exceptional (different)it is the large role played by the State and the affinity (despite what they might say) that Australians have for it.

J.R Nethercote discerns Australia has a “Talent for Bureaucracy”, Phil Lewis and Peter Yule write in different ways about Australia’s extraordinary regulation of industrial relations, Jonathan Pincus describes the State development of railways as “Socialism in Six Colonies”, Adam Creighton describes Australia’s system of compulsory superannuation as “extreme paternalism”, Richard Pomfret finds that the State acquiesces in a paternalistic structure of sports administration. In an interesting exploration of the difference between the grain trade in North America and Australia, Nick Cater finds that Australian agribusiness has been made weak by its bureaucratic development.

The writers would mostly agree with WK Hancock who in his seminal work Australia (1930) wrote:

“Australian democracy has come to look upon the State as a vast public utility whose duty it is to provide the greatest happiness for the greatest number…to the Australian, the State means collective power at the service of individualistic “rights”. Therefore he sees no opposition between his individualism and his reliance upon Government”.

Many of the authors cite Hancock and Henry Ergas has an intriguing Chapter comparing Hancock’s work Australia with Alexis de Tocqueville’s Democracy in America. It should be remembered that

Hancock was critical of this overweening State. He also saw the obsession with “fairness” as holding the country back.

Where does this Australian belief in Government come from? Some see it as the legacy of Government settlement, the fact that it was not individuals who led the migration of the 18th Century but a Government mission which made settlers reliant on Government from the earliest days. For others it is the fateful political “Settlement” of Australia’s first decade of Government entrenching Protection, Arbitration, and White Australia.

The original settlement and the Deakinite settlement early after Federation are historical events that no doubt influenced the country. They made it different at the time. But are they so important, so overwhelming, that their legacy will always reside in the Australian soul? Will Australians forever be disposed to look to the State to solve individual problems?

My experience as Treasurer for nearly twelve years was that we had shaken off a great deal of that secretly-harboured-lust for big Government. By 2007 spending was down to 23% of GDP one of the lowest in the OECD, our tax and spend ratios were significantly below the U.S., our Government had no net debt. When the doors closed at the meetings of the IMF, G-20, APEC, OECD, Australia would generally be recognised as a leader on economic reform because we had a track record of success. In its 2004 Economic Survey of Australia the OECD said:

“In the last decade of the 20th century, Australia became a model for other OECD countries in two respects: first, the tenacity and thoroughness with which deep structural reforms were proposed, discussed, legislated, implemented and followed-up in virtually all markets, creating a deep-seated “competition culture”; and second, the adoption of fiscal and monetary frameworks that emphasised transparency and accountability and established stability-orientated macro policies as a constant largely protected from political debate. Together, these structural and macro policy anchors conferred an enviable degree of resilience and flexibility on the Australian economy. The combination resulted in a prolonged period of good economic performance that shrugged off crises in its main trading partners as well as a devastating drought at home”.

In 2006 Australia was invited to the G-8 Finance Ministers Summit in St. Petersburg to lead a discussion on Good Governance in public finance. That had never happened before – or since.

Things today are different to the way they were a decade ago. We have had a period of bad Government. No-one would consider Australia an economic role model today. But with the resumption of competent Government can we resume the drive to make Australia competitive and prosperous? Could that become the norm once again? Or have we reverted to type? Was the period of economic reform an aberration? Was it a short period of exception to the exception? Has the country gone back to the way it always was?

This is the interesting question that hovers over this book. Coleman is quite pessimistic. He says:

“Australia is the country that won’t move on, which is stuck in its way. Australia is not the world’s ‘social laboratory’; it is a sacred grove dedicated to the dogged observance of customary gods.”

Like Coleman I feel pessimistic but I do not feel hopeless. The customary gods can be challenged and exposed like the prophets of Baal on Mount Carmel. But they need to be challenged.

Spending is currently 25.8% of GDP. It was increased as a “temporary measure” in response to the financial crisis of 2008. The Big Government Cheer squad, of course, says it cannot be cut. They want to permanently entrench this spending. But if it is to be pared back, they say, it can only be done “fairly” if taxes are commensurately raised, that is, the price for reducing what was to be a temporary increase in spending will be a permanent increase in tax. The effect will be to lock in a new, permanent, higher base for both.

None of these advocates pays any attention to the effect higher taxes have on an economy. They seem to think that a cut in spending and an increase in tax amounts to the same thing. In fact in the Orwellian world of Canberra a tax rise is now described as a Budget “save”.

It would be bad enough if that happened – a slight expenditure reduction for a slight tax increase – but as the experience of the Abbott Government has shown, the Coalition, after delivering a tax rise by increasing the top marginal tax rate to 49% was dudded on the quid pro quo. The Opposition Parties refused to deliver expenditure cuts. So the Abbott Government hiked income taxes for no return. Incidentally the increase in income tax was one that the Opposition never have had the courage to advocate on its own and certainly never had the capacity to deliver in Government.

The Coalition, the custodian of lower tax, can deliver tax rises if it abandons its traditional position. In this cause it can always count on Labor support. Labor, the custodian of higher spending, can deliver expenditure restraint if abandons its traditional position. In that cause it can usually count on Coalition. Leaving aside the Cross-bench, if Labor stands by its traditional constituency and the Coalition deserts its, then what we end up with are higher taxes to match higher spending. The Coalition becomes the facilitator of higher taxes. It can’t be done without them. It should be careful not to get out-marshalled on this issue.

Take industrial relations. Our union movement represents less employees than ever – around 11% in the private sector – and yet the Fair Work Act intrudes into every workplace and place of business- even volunteer firefighting. No-one identifies this as a systemic failure.

The advocates of big Government seem to be in the ascendancy. But the costs are rising and the country will have trouble with paying the bill.

A book like this gives a perspective to these issues. Times have been worse. And history ebbs and flows. With good leadership things can get better.

So this is a stimulating book of scholarly work. Only in Australia is an exceptional book on exceptionalism.

The Hon Peter Costello AC was the Treasurer of Australia from 1996 – 2007.  This paper was originally delivered at the launch of Only in Australia [Oxford University Press, 2016]