Category Archives: Australia

Unwise to Expect Anything Substantial from Biden-Putin Meeting This Week

This Wednesday, the United States president Joe Biden will meet Russian president Vladimir Putin in Geneva in the first meeting of the two since Biden came to power in January 2021. It would be unwise to expect too much from this meeting. There are a number of reasons for advancing this view.

The first of these reasons relates to American motives for the meeting. It is clear that the Americans have decided that the greatest threat to their position in the world comes from the Chinese. Their policy is plainly to try and isolate the Chinese. In this endeavour they are employing a number of tactics. One of these tactics is to negatively portray Chinese behaviour. Hence the constant use of pejorative terms such as “aggressive” or “one-sided” in their attempts to negatively portray Chinese interaction with its neighbours and international trading partners. That this tactic is blatantly obvious, not to mention untrue, has not deterred Americans from its relentless pursuit.

A second tactic is to try and set up an alternative system of international trade to compete with China’s Belt and Road Initiative. This is laughable. The BRI has already signed up more than 140 nations, including 12 members of the European Union. Australia is one of the few nations that have bought into the American propaganda about the BRI. Partial evidence for this is the treatment of the State of Victoria which signed memorandum of understanding with China.

This was bitterly opposed by the Morrison government, although it is impossible to find a rational basis for their opposition. A number of Australia’s neighbours, including New Zealand, have signed into the BRI and there is no evidence that they see themselves as victims of some Chinese plot to subvert their economies.

A third reason the talks will be unlikely to achieve anything of substance is history. The Americans have not ceased their economic and political warfare on Russia. The fact that the United States appears to have withdrawn its opposition to the Russian pipeline to Germany has more to do with a recognition that the Germans see it as essential to their economic well-being than anything else.

The Americans have been prepared to sacrifice the Ukrainians on this point, which is a measure of the importance to United States interest in Europe of keeping the Germans on side. In pursuit of this they are prepared to sacrifice the Ukrainians. This latter fact has come as a rude shock to the Ukrainians who faced the twin humiliation of a visit from United States secretary of state Antony Blinken followed by a blatant refusal by Biden to support Ukrainians when the latter made a telephone call to the White House.

The Americans continue in their demands that Crimea should be returned to Ukraine, which tells one more about the American grasp of geopolitical reality than it does about the likelihood of Crimea ever becoming part of Ukraine again. History is not the least of the reasons why Crimea will remain part of Russia. Australia has bought into the rubbish that Crimea is part of Ukraine. They would do well to remember their own history, including the fact that the Australians fought the Russians in Crimea in the 1850s.

Putin is also well aware of American efforts to destabilise countries on its borders, including a coup attempt last year to overthrow the government of Georgia. This is on top of ongoing destabilisation by the Americans on Russia’s other neighbour Belarus. Biden’s faux friendliness to Russia has not stopped any of these destabilisation efforts.

Part of the problem the Americans have in dealing with Russia is that the upper echelons of power in Washington are appallingly ignorant of Russia. They have fallen into the trap of believing their own propaganda. Their mainstream media is no better. The Russian writer Andrei Martyanov, an American resident and one of the most clearsighted analysts around, is particularly scathing of the quality of United States “analysis” of Russia.

In his latest book, Disintegration, (2021) Martyanov argues that the United States is “non-agreement capable.” Anything that the Americans sign is worthless as they cannot be relied upon to honour that in the longer term. He argues most recently (June 13) that the forthcoming summit between Biden and Putin is primarily for United States domestic consumption and for the benefit of the United States’ vassal states in Europe, designed to prove that “America is back.” Back to what exactly remains an open question.

Another of the real reasons for Biden wanting the summit is the gap that has broken out between Russian and United States weaponry. The United States is currently about 10 years behind the Russians in military technology and Biden is desperate to pin the Russians into some form of treaty that could limit the effects of this devastating gap. Russian weaponry such as the 3M 22 Zircon and the 3M 14 Khalibr are overwhelmingly superior to anything the Americans have. Putin is highly unlikely to agree to anything that will lessen the Russian advantage in these areas.

Biden will be making a desperate attempt to peel the Russians away from the effect of their alliance with China. His motives are obvious. The Americans want to be left with a clear field to refine and expand their attack upon China. That attack could quickly degenerate into a real shooting match given the constant provocation in the South China Sea that the United States (with their British and Australian allies) are constantly engaging in.

The Russia – China allegiance is now 20 years old and has never been stronger. American ambitions about luring the Russians away from the Chinese embrace are doomed to failure.

In short, it would be extremely unwise to expect any achievements from the Biden – Putin summit this week. There will be polite noises and many smiles, but the odds against a serious achievement run into the brick wall of the United States’ profound belief in its mission as “leaders of the free world.” As long as they maintain that delusion the chances of a serious degree of agreement are practically zero.

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Racist, misogynist, militaristic, imperialistic, homophobic, white Christian supremacy

Canadians like to think of ourselves as less racist, less right wing and especially less violent than Americans. But two recent events coming after a previous series of mass murders has shaken this belief.

Four members of a Muslim family were murdered in a hate crime while out for a stroll last Sunday in London, Ontario; two weeks earlier 215 First Nations children were found buried on the grounds of a Kamloops, B.C. Indian residential school; one year ago 22 died during a shooting spree by a Nova Scotia wannabe cop with a severe anger management problem after a fight with his girlfriend; four years ago 26 people, mostly women, were mowed down by a misogynist on a Toronto sidewalk leaving 10 dead; a year before that, six worshippers were shot and killed by a young man in a Quebec City mosque. All murders motivated by right wing hate.

This isn’t the real Canada, some people say. But it is. And always has been.

The truth is Canada, the British colony that preceded it, and the French colony before that, were all founded on racist, misogynist, militaristic, imperialistic, homophobic, white Christian supremacy. This is a history we share with the USA, Britain, Australia and New Zealand, all members along with Canada, of the “Five Eyes” intelligence alliance.

Our countries have proudly glorified white male warrior, racist colonialism and participated in it at home and abroad. Our laws, our institutions, our foreign policy, our culture have all been affected by these vile practices and ideologies, and they continue to infect and influence us today.

And this is not ancient history.

Born in 1953, I have lived in a Canada with genocidal residential schools, racist laws and immigration policies, that forbade people from voting based on their ethnicity, that ensured property could only be sold to white Christians, that jailed people for their sexuality, that had quotas for Jews in universities, that criminalized women’s reproductive rights and taught me in Catholic school that men were the head of the family and to be proud of the British Empire. The legacy of all that remains alive in me and my country.

These are historical facts that, if acknowledged, can be confronted, and overcome. But you can’t build a better world on a foundation of lies or ignorance, only on concrete reality.

And confronting our past is not just “virtue signalling” or part of “woke” culture or some academic exercise or ritual self-flagellation to earn forgiveness for our sins. There are those who revel in and glorify this past and would return us to it, whether we like it or not. Ignoring or whitewashing our history empowers the right-wing extremists who today wish to create something very much like Margaret Atwood’s Republic of Gilead. It is not only our neighbours to the south who are at risk of an authoritarian fascism built upon making America great again. There are people in all the “Five Eyes” who promote racist, colonial, imperialistic, misogynist, militaristic, homophobic white Christian supremacy and will use violence to achieve their goals.

Having spent the past four years researching and writing about the extreme right in the FAKE NEWS Mysteries, including my latest, American Fascism, there is no doubt in my mind that more violence is coming.

Fascists are conservatives in a panic. They are panicked because they see the victories of women, people of color, First Nations, anti-racists, the LGBTQ+, unions, socialists, peace advocates, environmentalists and internationalists as threatening. They are funded by some very wealthy people who use fascists as the tip of the spear against economic democracy. At its root fascism is a violent defence of economic and social privilege.

To combat those who would inflict Gilead upon us, we must understand who we were, who we are and who we would like to be. As many self-help books posit, knowing yourself is the first step to change. That’s exactly why conservatives and fascists glorify the past, defend statues of racists and insist history should focus on instilling patriotism instead of telling the truth.

To combat them we must educate ourselves and especially our children. Only then can we build a better world, one where all people can live together in respect, dignity and equality. One that is not afraid of positive change. One that can resiliently resist right wing extremism.

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Denmark Offshores the Right to Asylum

This has been a fantasy of Danish governments for some time.  There have been gazes of admiration towards countries like Australia, where processing refugees and asylum-seekers is a task offloaded, with cash incentives, to third countries (Papua New Guinea and Nauru come to mind).  Danish politicians, notably a good number among the Social Democrats, have dreamed about doing the same to countries in Africa, returning to that customary pattern of making poorer states undertake onerous burdens best undertaken by more affluent states.

The government of Mette Frederiksen has now secured amendments to the Danish Aliens Act that authorises the transfer of asylum seekers to other countries as their applications are being processed.  The measure was secured on June 3 by a vote of 70 to 24, though critics must surely look at the absence of 85 MPs as telling.  The measure is not automatic: the Danish government will have to secure (or bribe) the trust of third party states to assume their share.

Government spokesman Rasmus Stoklund left few doubts as to what the new law entailed.  “If you apply for asylum in Denmark, you know that you will be sent back to a country outside Europe, and therefore we hope that people stop seeking asylum in Denmark.”

Stoklund’s language of warning evokes parallels with Australia’s own campaign of discouragement, marked by a highly-budgeted effort featuring such savage products as No Way.  You Will Not Make Australia Home.  In the video, Lieutenant General Angus Campbell, then chief of Australia’s effort to repel naval arrivals known as Operation Sovereign Borders, is stern in threatening that “if you travel by boat without a visa you will never make Australia home”.  Other delights involve a graphic novel, translated into 18 different languages, promising trauma and suffering to those who end up in a detention centre in the Pacific, and the feature film Journey, where an Iranian mother and her child seek sanctuary in Australia.  The Danish propaganda arm will have some catching up to do.

Who then, are the third country candidates?  Denmark already has a memorandum of understanding with the Rwandan government that covers migration, asylum, return and repatriation.  Its purpose is to target an asylum system which supposedly gives incentives to “children, women and women to embark on dangerous journeys along migratory routes, while human traffickers earn fortunes”.  When it was made, Amnesty International’s Europe Director, Nils Muižnieks could see the writing on the wall, calling it “unconscionable” and even “potentially unlawful”.  But for Rwanda, just as it is with Pacific island states such as Nauru, money is to be made.  Such countries effectively replace demonised people smugglers as approved traffickers and middlemen.

The response to the legislation from those in the business of advocating for refugees and the right to asylum has been uniform in curtness and distress.  Filippo Grandi, the UN High Commissioner for Refugees, voiced strong opposition to “efforts that seek to externalise or outsource asylum and international protection obligations to other countries.”

UNHCR spokesman Babar Balloch could only make the relevant point that the legislation ran “counter to the letter and spirit of the 1951 Refugee Convention”.  Moves to externalise “asylum processing and protecting of refugees to a third country… seriously risk setting in motion a process of gradual erosion of the international protection system, which has withstood the test of time over the last 70 years”.

Balloch is evidently not as attentive as he thinks: those wishing to externalise such obligations have well and truly set this train in motion.  The 2018 EU summit went so far as to debate the building of offshore processing centres in Morocco, Algeria and Libya to plug arrival routes via the Mediterranean.  The UK government is also toying with the idea of an offshore asylum system.

Bill Frelick of Human Rights Watch’s Refugee and Migrant Rights Division distils the relevant principle being sacrificed.  “By sending people to a third country, what you are essentially doing is taking what is a legal right and making it a discretionary political choice.”  It is an increasingly attractive, if grotesque policy, for wealthier countries with little appetite to share the burdens of sharing the processing claims under the UNHCR’s Global Compact on Refugees.

Unfortunately for Frelkick and their like, the Danish government is proving derivatively consistent.  It has been opting out of the European asylum system since the 2000s, doing its bit to fragment an already incoherent approach in the bloc.  The centre right government of Anders Fogh Rasmussen, just by way of example, was proud to reduce the number of asylum seekers and those wishing to settle in Denmark.  In 2004, 1,607 people were granted asylum compared to 6,263 three years prior.

The approach of the current government is to negate the very right to seeking asylum in Denmark, aided by third countries.  And there is not much left to do, given that the country received a mere 1,515 asylum applications in 2020, its lowest in two decades.  Of those, 601 were granted permits to stay.

Lurking, as it always does in these situations, is the Australian example.  The right to asylum is vanishing before the efforts of bureaucrats and border closing populists.  The UN Refugee Convention, like other documents speaking to freedoms and rights, is becoming a doomed relic.

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The Russia-China Relationship Points to a Better Future for the World

The United States is openly stating its desire for a better relationship with Russia. At the recent meeting in Reykjavík, Iceland, United States secretary of state Blinken and his Russian counterpart Lavrov held what has been termed as a cordial meeting. It is well known that United States president Biden is anxious for a meeting with his Russian counterpart Putin. The Russians are correct to be cautious about such a meeting. Biden has some lost ground to make up. His television interview shortly after being elected in which he agreed with the interviewer that Putin was a “killer” has not been forgotten in Moscow.

The Americans have made other gestures to signify that they are interested in a better relationship with Russia. Among these gestures is the dropping of United States attempts to stifle the completion of the Nord Stream 2 project that will bring electricity from Russia to Germany. That deal is due for completion later this year and will probably be delivering Russian power to Germany by September.

United States opposition to the deal always had a high level of self-interest as they wished the Europeans to buy their own, much more expensive, electricity. The Germans were never interested in that deal, for multiple reasons, not the least being that it would place German industry even more susceptible to United States influence than is already the case.

Although Nord Stream 2 now looks highly likely to be completed, it is not yet a done deal. There is some significant opposition within Germany itself, somewhat surprisingly, coming from the Green Party who are currently polling well is advance of September’s elections. It is surprising because the Green Party attitude placed them in line with the American view, which is one indicator of how far the Greens have travelled from their early days.

The support of German industry is likely, however, to be decisive, regardless of the outcome of September’s elections. The election also marks the retirement of Chancellor Angela Merkel who has been the dominant German leader for the past 15 ½ years, making her Germany’s third longest serving leader.

The United States gestures toward improved relationships with Russia has, of course, a subtext. The Americans have decided that the greatest threat to their continued domination is the rise of China. If the Americans are to compete with China, they see the need to separate Russia and China.

It is a fact that the Russian-China relationship has grown markedly in recent years. In trade terms alone, Russia’s trade with China grew 20% in the first quarter of this year. Apart from trade there are a number of other areas where the two nations are building an ever-closer relationship, not least in their bilateral trade, but also through the joint membership of the Shanghai Corporation Organisation and other international organisations.

Those organisations have a common interest in developing strong trade relations, freed from the often-suffocating embrace of the western dominated financial institutions that have dominated world international trade for the past 70+ years.

China has been at the forefront of developing this new system. It is exemplified, for example, by its Belt and Road Initiative, which now embraces more than 140 countries around the world, having representation in all of the world’s regions including Africa and Latin America. Those two regions have historically been under the heavy influence of the British and the Americans respectively.

It is no surprise that the United States is a prominent non-starter with the Belt and Road Initiative, seeing it as a threat to their earlier domination. Unsurprisingly, they are joined in this antipathy by Australia whose federal government recently blocked moves by the state of Victoria to participate in the BRI. The Australian government has gone out of its way to antagonise the Chinese in recent years, which, to put it mildly, is a singularly stupid policy to pursue with one’s largest trading partner by a considerable margin.

Australian ministers have recently complained that their phone calls to Chinese counterparts go unanswered and not returned. According to the Australian government it is all China’s fault, which tells one more about the Australian mindset than it does about the reality of the relationship.

China in the meantime continues its relentless advance. As measured by the more reliable indicator of parity purchasing power, rather than gross domestic product, China is now the world’s largest trading entity, having passed the United States some years ago. One of the reasons for China’s success, in the BRI and elsewhere, is that they base their relationship with their trading partners on what Chinese leader Xi calls a “win-win” situation.

Unsurprisingly, this approach, so different from the West’s way of doing business, is one that finds favour with a vast number of countries. United States attempts to contain China and limit its ever-growing influence around the world is therefore unlikely to succeed.

That does not make the United States challenge any less serious and one fraught with potential risks. United States has had things its own way for so long, and has used and abused that power with virtual impunity, that it will not take the emergence of a serious competitor lightly. Therein lies the greatest danger to the world.

The Chinese are not going to allow any return to the dark years when they were dominated by Western influence. If the Americans do something stupid, like a military response to their declining power and influence around the world, then the Russia-China close relationship will doom that effort to failure. The majority of the world’s countries who are benefiting from the new form of partnership will certainly lend their influence to ensure the return to the old days of United States dominance remains very much a matter of the past.

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Coronavirus Travels and Cruising with Viking

It starts off as an exercise of anticipation.  First comes the softening drinks and teasing morsels which find their mark.  The audience at this promotions gig is well heeled, of an age where they have money to burn, but nowhere to burn it.  They have not travelled on a luxurious prison of bliss for eighteen months.  The world has been ravaged by a pandemic, and they yearn to be ravished by the flavour, surrounds and excitement that is Viking Cruises.

Cruise liners are not for all but advertise themselves as the unrivalled option of travel for the satisfied life.  But every satisfied life comes in gradations, levels, and categories.  Pay more and the cabin room expands with magical effort.  Pay more and the minibar miraculously replenishes.  (Those who opt for the lesser option tend to find themselves having to pay more for other frills and accessories.)  The exercise entails an effort to create a microclimate from home: you are away, but you never leave that sacred grove; you are on a journey, but you are still there, with your home comforts.  You are, in fact, discouraged of seeing anything new, and anything new is heavily curated, even censored, to remove crinkles and crumples.

Viking Cruises claim to provide an ultrapure version of that experience.  The cruise company, founded by Torstein Hagen, began in 1997 with four ships.  The fleet ballooned to 82 vessels to gain primacy over ocean and river cruise routes.  New markets were founded with buccaneering enthusiasm.  In the 2000s, Hagen sensed an opportunity to lure tourists from the United States to Europe.  The Chinese market followed.  At the start of 2020, 30,000 Chinese passengers were ready to travel with the company.  Forget the poor coach operators and the need to use multiple hotels during your journey.  Take, instead, to water, your cruising home.

The Scandi flavour is essential.  Minimalist décor; warmth and heating in rooms and saunas; ice and stimulation in baths; dining advertised as Scandinavian and American themed.  Viking supplies a Nordic version of Ying and Yang, an attempt to awaken and soothe the body.  There are also other activities: guest lectures, pursuits of leisure, and tailored cultural excursions that cut out wily middlemen, the proles and most of the locals.  There is an unmistakable sense of being in a plush asylum at sea, where the wealthy flirt with change without enduring any, incubated by the narrowest of realities.  It is highly filtrated tourism. No riff raff; no queues; no barging.  Local flavour and indigenous feeling, eviscerated.

Go behind the gloss, however, and we have a corporate empire that has suffered from occasional villainy and accusation. In November 2019, passengers filed a class action lawsuit against Viking River Cruises division, alleging fraud, unjust enrichment and violations of California’s Unfair Competition Law and Consumers Legal Remedies Act.  The main claim: that Viking had encouraged passengers to cough up tips for crew members, 10 percent of which were diverted to a tip account.  Naughty.

That same year, another class action suit was filed alleging that Viking Cruises had “sailed through notoriously perilous waters into the path of a Bomb Cyclone where, due to the defendants’ negligence, the vessel lost power leaving the vessel adrift to be battered by high seas and winds as it drifted towards dangerous reefs.”  Not the heavily pampered, curated tourist experience the claimants had hoped for.

Then came the novel coronavirus.  Cruising on water suddenly seemed less safe.  Horror stories were registered about infections at sea with people confined to their cabins.  Ships were turned away from harbours as borders closed.  In some cases, infected passengers seeded outbreaks.  The Diamond Princess cruise ship became a public health experiment in real time, its 3,711 passengers and crew members putative lab rats.  Epidemiologists were also thrilled at a chance to study the effects of virus in confinement.  “Cruise ships are like an ideal experiment of a closed population,” Stanford University epidemiologist John Ioannidis told Nature.

Such experiments cost Hagen, who saw his personal wealth fall from $6.28 billion to $2.1 billion.  His company had to rely on investments from the Canada Pension Plan Investment Board, an asset management company, and private equity firm TPG Capital.  CPP Investments’ managing director, Bill MacKenzie, was clearly chancing his arm.  “While the pandemic has posed many challenges, we have strong conviction that Viking’s unique global offering in the cruise industry will continue to be sought out by many guests well into the future.”

MacKenzie must have full barrels of conviction, given the losses arising from a global tourist market that went into hibernation in an instant.  On March 11, 2020, Viking prided itself in a statement as being “the first cruise line to suspend operations of our river and ocean cruises.  Our commitment to our family of guests and employees is that their safety and wellbeing is always our top priority.”  Departures for the rest of 2020, and for a good deal of 2021, were also cancelled.  The company, in an effort to redress the rot, offered a 125% Future Cruise Voucher to affected customers.

With those realities hovering over the evening’s proceedings at the W Melbourne hotel, there is an air of wishful hope over hard, pandemic worn experience.  The two employees of Viking Cruises pushing the cruise product do their best putting on a brave face.  They have, at their disposal, videos featuring Hagen, brochures and snappy slide shows.

There is something light about the Norwegian.  Hagen appears like an apparition of assurance in these promotions, sedate and softly spoken.  The videos feature him praising a brand, and a form of travel, in the time of coronavirus.  He insists that his company is ahead of the times: guests will be tested on a daily basis in the least intrusive ways for COVID-19; physical distancing requirements will be policed with rigour.  In terms of expertise, he touts the skills of Raquel C. Bono, the company’s newly appointed health officer.

Hiring Bono was very much part of the campaign to assuage customers.  The company press release from November last year announcing her appointment brims with praise.  “A board-certified trauma surgeon and retired Vice Admiral of the United States Navy Medical Corps, Dr Bono most recently led Washington State’s medical and healthcare systems response to the COVID-19 pandemic.”  Her appointment also came in the wake of an announcement that Viking would “become the first cruise line to complete the installation of a full-scale polymerase chain reaction (PCR) testing laboratory at sea.”  The lab rats could travel with confidence.

After the presentations come the worried questions.  They are almost entirely focused on COVID-19.  How would it affect future travel?  Why bother with bookings that would have to be cancelled?  This was tourism as a precarious contingency.  The pleasure classes were anxious.  Those charged with promoting the Viking brand could only point to small guarantees about bookings that could be held over.  The rest was merely a case of purchasing tickets and crossing fingers.

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Elbowed and Hustled: Australia’s Yellow Peril Problem

With the babble about Cold War paranoia becoming a routine matter in Canberra, the treacherous ground for war with China is being bedded down and readied.  The Yellow Peril image never truly dissipated from Australia’s politics.  It was crucial in framing the first act of the newly born Commonwealth in 1901: the Immigration Restriction Act.  Even as China was being ravaged and savaged by foreign powers and implosion, there was a fear that somewhere along the line, a reckoning would come.  Charles Henry Pearson, a professor of history at King’s College London, penned his National Life and Character: a Forecast (1893) with fear in mind.  The expansion of the West into all parts of the globe and its claims to progress would soon have to face a new reality: the threat posed by the “Black and Yellow races”.

Pearson fastened on various developments.  The population of China was booming.  The Chinese diaspora, the same, making their presence felt in places such as Singapore.  “The day will come and perhaps is not far distant, when the European observer will look round to see the globe girdled with a continuous zone of the black and yellow races, no longer too weak for aggression or under tutelage, but independent, or practically so, in government, monopolising the trade of their own regions, and circumscribing the industry of the Europeans”.  Europeans would be “elbowed and hustled, and perhaps even thrust aside by peoples whom we looked down upon as servile and thought of as bound always to minister to our needs.”

The work’s effect was such as to have a future US President Theodore Roosevelt claim in a letter to Pearson that “all our men here in Washington … were greatly interested in what you said.  In fact, I don’t suppose that any book recently, unless it is Mahan’s ‘Influence of Sea Power’ has excited anything like as much interest or has caused so many men to feel like they had to revise their mental estimates of facts”.

Anxiety, and sheer terror of China and the Chinese became part of the political furniture in Washington and in Britain’s dominions.  In Australia, such views were fastened and bolted in the capital.  The country’s first Prime Minister, Edmund Barton, drew upon Pearson’s work extensively in justifying the Immigration Restriction Act in 1901.  The White Tribe had to be protected.

In 1966, the Australian historian Donald Horne noted the continuing sense of impermanence for those living on the island continent, that “feeling that one morning we shall wake up to find that we are no longer here”.   He recalled the views of an unnamed friend about China’s political aspirations, voiced in 1954.  By 1957, he predicted, Southeast Asia would have fallen to its soldiers.  Australia would duly follow, becoming a dependency. “Because of the submerged theme of impermanence and even catastrophe in the Australian imagination,” observed Horne, “the idea of possible Chinese dominance is ‘believable’ to Australians”.

There was a hiatus from such feeling through the 1980s and 1990s.   The view in Australia, as it was in the United States, was that China could be managed to forget history, disposing itself to making money and bringing its populace out of poverty.  But historical amnesia failed to take hold in Beijing.

Australian current actions in stoking the fires of discord over China serve a dual purpose.  There is a domestic, electoral dimension: external enemies are always useful, even if they are mere apparitions.   Therein lies the spirit of Barton, the besieged White tribe fearing submergence.  The other is to be found in the realm of foreign policy and military security.  Australian strategists have never been entirely sure how far the ANZUS Treaty could be relied upon.

One moment of candour on what might happen to trigger ANZUS obligations took place in 2004.  Australia’s Foreign Minister Alexander Downer, on a trip to Beijing, pondered the issue of how a security relationship with China might affect US-Australian ties.  Asked by journalist Hamish McDonald whether Australia had a treaty obligation to assist the US in defending Taiwan, the minister stated that the treaty was “symbolic” and would only be “invoked in the event of one of our two countries, Australia or the United States, being attacked.  So some other military activity elsewhere in the world, be it in Iraq or anywhere else for that matter does not automatically invoke the ANZUS Treaty.”   Its provisions, he observed, had only been invoked once: when the United States was attacked on September 11, 2001.

This startlingly sound reading did not go down well.  The press wondered if this cast doubt over “ANZUS loyalties”.  The US Ambassador to Canberra John Thomas Schieffer leapt into action to clarify that there was an expectation that Australia muck in should the US commit forces to battle in the Pacific.  “[T]reaty commitments are that we are to come to the aid of each other in the event of either of our territories are attacked, or if either of our interests are attacked, our home territories are attacked or if either of our interests are attacked in the Pacific.”  One cable from the Australian government attempted to pacify any fears about Australia’s reliability by suggesting that, “Some media reporting had taken elements [of Downer’s comments] out of context.”

The argument has now been turned.  Discussion about Taiwan, and whether Australian blood would be shed over it, has much to do with keeping Washington focused on the Asia- and Indo-Pacific, finger on the trigger.  If Canberra shouts loudly and foolishly enough that it will commit troops and weapons to a folly-ridden venture over Taiwan, Washington will be duly impressed to dig deeper in the region to contain Beijing.  This betrays a naivety that comes with relying on strategic alliances with little reflection, forgetting that Washington will decide, in due course, what its own interests are.

So far, the Morrison government will be pleased with what the Biden administration has said.  Australia could be assured of US support in its ongoing diplomatic wrangle Beijing.  In the words of US Secretary of State Anthony Blinken, “the United States will not leave Australia alone on the field, or maybe I should say alone on the pitch, in the face of economic coercion by China.  That’s what allies do.  We have each other’s backs so we can face threats and challenges from a position of collective strength.”

Australia’s anti-China rhetoric has its admirers.  Michael Shoebridge of the Australian Strategic Policy Institute – a US security think tank in all but name – dismisses the value of words such as “major conflict,” preferring the substance of action.  He talks about “honesty” about China, which is grand coming from a member of an outfit which is less than frank about its funding sources and motivations.  That honesty, he assumes, entails blaming China for belligerence.  “Reporting what [President] Xi says and what the PLA and other Chinese armed forces do is not ‘stoking the drums of war’; it’s noticing what is happening in our region that affects our security.”

Thankfully, former Australian foreign minister Gareth Evans is closer to the sane fringe in noting that words, in diplomacy, are bullets.  He reminds us of “the immortal wisdom of the 1930s Scottish labour leader Jimmy Maxton: ‘If you can’t ride two horses at once, you shouldn’t be in the bloody circus.”

The post Elbowed and Hustled: Australia’s Yellow Peril Problem first appeared on Dissident Voice.

Put the Banks Under State Control!


In recent years, the ripping off of customers, deceit and even outright fraud practiced by Australian finance sector businesses has gained much attention. Four years ago it was revealed how CommInsure, the insurance arm of the Commonwealth Bank of Australia (CBA), had refused to make promised life insurance payments to heart attack survivors. They “justified” this by using a definition of a heart attack that was so dodgy that even some people who had such a severe heart attack that they had to be resuscitated were denied their entitled pay outs! Such devious practices have been undertaken by finance sector enterprises big and small – from the big four banks and insurance giants to brokers and loan enablers and to retail businesses that hand out loans. As a result the banks, insurance companies and the brokers and others connected to them are widely hated by the masses. With good reason! Yet finance sector institutions have a decisive influence on society. For it is they who determine how credit is distributed and credit is absolutely critical to the running of modern economies. Especially at this desperate time when this country and much of the world face both a public health emergency and economic collapse, it is vital that credit is allocated in ways that can best respond to the COVID-19 virus threat and into areas that can best ensure that the jobs and wages of millions of working class people are guaranteed. Yet would you trust the lying, greed-driven bosses of the banks and insurance companies to do this? You would be totally nuts if you did! We need to put all the banks and insurance companies under state control! In other words, we need to nationalise the finance sector.

In late 2017, there was so much anger built up against the banks, insurance giants and brokers that former prime minister Malcolm Turnbull, realising the need to “restore the credibility” of the finance sector, finally acceded to widespread demands for a royal commission into the banking and insurance industry. That Royal Commission revealed more details of what many of us already knew. Banks were giving secret commissions to brokers to entice them to get home buyers to take out home loans with their particular banks. Banks hid these payments in order to trick their customers into believing that their customers’ “own” brokers were “independent.” But, actually, the payments that these brokers received from particular banks gave them an incentive to get people to take out mortgages with these same particular banks even if that was not the best option for the broker’s customer. And the brokers did this in spades! Moreover, since the commission received by the broker got larger the bigger the loan taken out by their customers, the brokers, with a nod and a wink from the banks paying them, often pushed their customers into buying a more expensive house than they could actually afford. That is part of why household debt is so frighteningly high in Australia.

One of the aspects of the finance sector industry that was exposed is the practice of charging clients fees for no service. Banks and insurance companies and their financial planning and superannuation subsidiaries were found to be charging people “advice” and “service” fees for their investments and superannuation accounts but then providing no advice at all. Put simply, the banks and insurance companies were downright stealing from hundreds of thousands of their customers. AMP, NAB, CBA, ANZ and Westpac were found to be the worst offenders. The amount that these companies stole from their customers through fees for no service was officially estimated to be well over a billion dollars. The real figure could be even higher. Moreover, some of these institutions had even knowingly continued to charge their customers fees for no service … after they had died! The fees would then be paid out of the estate of the deceased customers – in other words, be paid largely by the close relatives of the deceased customers, most often their spouses and children. The Commonwealth Bank even knowingly charged one of their dead clients fees for “financial planning advice” for more than a decade after they died! Meanwhile, insurance giant AMP continued to charge some of their dead customers life insurance premiums.

A Slap on the Wrists for the Swindling Banks and Insurance Companies

The banking royal commission and the media coverage surrounding it tended to focus on atrocities committed against small business owners, farmers and other middle class customers – especially upper-middle class ones – or against better paid workers able to acquire substantial savings. Indeed, under the capitalist system the big capitalists – at the apex of which stand the bank owners – rip off the small-scale capitalist exploiters and all of them, while leaching the most from wage workers, skim off also from the middle class, even from the upper middle class. Yet, the people most hurt by the thieving greed of the banks and insurance companies are average income workers and especially lower-paid, casual and unemployed workers. They are the people most hurt by the banks charging large set fees as these fees often make up such a big proportion of their modest savings. It is poorly paid workers, retrenched workers and long term unemployed workers who are also the most burdened by the extortionate interest rates charged by banks in credit card accounts. It is the low income of these people which pushed them to get into debt in the first place, while the cruel interest rate they must pay off with their debts plus their meagre incomes ensures that many have little possibility of ever paying off these debts. And often desperate for credit, casual and unemployed workers, low income single mothers and people with disabilities are the most vulnerable to being ripped off by loan brokers and short term credit providers handing out loans with exorbitant interest rates.

The banking royal commission did hear about how insurance companies were using aggressive telemarketing and deceptive policies to rip off Aboriginal customers, many struggling on low incomes. It was told of how insurance companies operating in remote Aboriginal communities took advantage of language barriers and Aboriginal people’s tendency to be friendly and polite to sign up on the phone Aboriginal people to life and funeral insurance that they neither truly consented to nor even needed. One of the enterprises exposed for pushing unnecessary funeral insurance on Aboriginal people is the “Aboriginal Community Benefit Fund” (ABCF). With its name including “Aboriginal Community” and its use of a rainbow serpent image, ABCF gave the impression that it was an Aboriginal community-run organisation. But it was not! It was a private, profit-driven company that was neither owned nor managed by Aboriginal people. However, ABCF used the trust gained by the appearance of being a community-run organisation to push Aboriginal people into forking out large amounts for funeral insurance that they did not need. Thus ABCF often signed up healthy young Aboriginal woman in their twenties and early thirties for funeral insurance. They even pushed thousands of Aboriginal parents into getting funeral insurance for their babies in schemes that would cost up to $100,000 over a lifetime! ABCF owners then quietly excluded families of Aboriginal people who died from suicide from receiving payouts, thus ensuring that they would not to have to pay claims of a very large proportion of the insured children that actually did die young.

The banking royal commission did also hear snippets about the massive exploitation of low-income people by businesses handing out consumer leases and so-called payday loans – where people are lent money until their next pay check at massive interest rates. Aboriginal financial counsellor, Lynda Edwards, also told of how car dealers took advantage of the necessity for cars in remote areas to sell Aboriginal people dud cars with ultra-high interest loans. A report published a year ago by Flinders University detailed how one Aboriginal customer was made to pay $52,000 for an $18,000 car at an interest rate of 35% despite the fact that the over-priced used car stopped working long before the loan was repaid! Indeed, the royal commission was told of how some Aboriginal people had been charged even higher interest rates for car loans, rates of 48%!

Yet the nature of the Royal Commission was such that it did not compel those involved in such scams and high-interest loan pushing to defend their actions. As senior counsel assisting the commission, Rowena Orr QC, explained: “We will not be considering consumer leases, payday loans or in-store credit arrangements in these hearings because they do not fall within the terms of reference of the commission.” Put simply, the Royal Commission was not meant to truly protect the interests of low-income people from the predatory behaviour of banks, insurance firms and retail business owners. To the extent that the banking royal commission was not entirely about “restoring the credibility of the finance sector” or simply about allowing the furious masses to vent steam in a way that does not actually harm the interests of the finance industry bigwigs, the investigation was aimed at curbing the excesses of the bank owners in the interests of other sections of the capitalist class – including retail sector bigwigs, “small and medium size” enterprise bosses and big farm owners – as well as the more privileged sections of the middle class that the upper class rely on for social and political support. After all, the state in capitalist countries is an executive committee for managing the affairs of the capitalist labour-exploiting class as a whole. At times they have to slightly clip the wings of even their most powerful section – the finance sector bigwigs – in order to ensure the interests of the rich ruling class as a whole. But even here the Royal Commission’s impact was minimal. Sure, there were some stunning revelations of the depth of the banks and insurers’ greed and deceit. Several finance sector CEOs and directors also had to resign from their positions in the wake of the revelations and, mind you, then take away multi-million dollar severance pay and shareholdings, thank you very much. Yet Royal Commission head, Kenneth Hayne, did not recommend one single charge against any specific finance sector boss despite the fact that the hearings of the commission plainly showed that banks and insurance companies had stolen and swindled well over a billion dollars from hundreds of thousands of their customers. Instead, the commissioner handed over 24 recommendations to the regulators over instances of misconduct and charged them with the responsibility of considering any action. However, he refused to even name the people and institutions involved. And over a year since the final report of the commission was handed down, not a single finance sector boss has been charged let alone been put behind bars. Meanwhile, even after having promised to implement nearly all of Commissioner Hayne’s recommendations, the government has yet to even introduce legislation to turn several of the recommendations into law.

The more important point is that Commissioner Hayne’s report only recommended cosmetic changes to the finance sector. Cold calling of financial products over the phone was recommended to be banned and mortgage brokers would be required to act in the best interests of their customers (as if that is going to actually happen!). However, the economic power, profitability and overall impunity of the finance sector corporations will be largely untouched. In fact, the bank owners were so delighted with the outcome of the Royal Commission that the first stock market trading after the commissioner handed down his final report saw the share prices of the big four banks skyrocket by almost A$20 billion – their biggest one day rise ever!

The limp recommendations of the Royal Commission are, indeed, what the right-wing Australian government always intended to be the outcome. Indeed, the Liberal government was so intent on enhancing the reputation of the bank bosses that shortly before the Royal Commission was announced, they and the bank heads arranged for the bank bosses to send a letter to the government themselves calling for the Royal Commission! This enabled the government to put the bank bigwigs in good light by saying that the banks themselves wanted the inquiry. Indeed, the relationship between bank owners and the government is so cosy that the letter from the heads of the big four banks to the government calling for the Royal Commission was first sent in draft form to the then treasurer, Scott Morrison, to be vetted by him before being made an official letter the next day! Let’s not forget that the then prime minister, Malcolm Turnbull, who, kicking and screaming, called the Royal Commission was himself the owner of an investment banking firm and later a managing director for the Australian arm of U.S. banking giant, Goldman Sachs.

In order to appease their working class base and appeal to widespread middle class public opinion, the ALP Opposition has been more critical of the banks than the Coalition government. But let us remember that when they were in government previously from 2007 to 2013, when some of the most blatant fraud by the finance sector companies was being committed, the ALP also did nothing to stop it. Today in the wake of the Royal Commission, the ALP only called for implementing its weak recommendations. Nothing more. The ALP are certainly not calling for putting the banks under state control or even under greater regulation. After all it was the former Hawke-Keating ALP government that carried out the biggest deregulation of the finance sector in Australian history. They removed the cap on the interest rates that banks could charge for home loans and abolished other controls on bank interest rates. In short, the Hawke-Keating Labor government freed up bank owners to do whatever it takes to maximise profits regardless of the consequences to society. Most harmfully, they also privatised the formerly state-owned Commonwealth Bank.

While the ALP is a party with a working class base, its futile program of trying to improve the lot of workers while accepting the capitalist order means that it necessarily needs to collaborate with – and ultimately kowtow to – that apex of capitalist power, finance capital. Thus, the ALP’s ties to the bank bosses are not far behind those of the conservatives. The investment banking firm that Malcolm Turnbull established, referred to above, was actually set up in a partnership with none other than former NSW ALP premier, Neville Wran, and Nicholas Whitlam – the son of former prime minister and ALP icon, Gough Whitlam. The bank was actually called Whitlam Turnbull & Co Ltd. Today, the CEO of the Australian Banking Association, who has done so much to deceive the population by being the chief apologist for the bank bosses is former Queensland ALP premier, Anna Bligh. Meanwhile, during the last financial year that disclosures of political donations have been revealed, 2018-19, the ALP received more than $2.5 million from Westpac alone! They were also given $50,000 from the main body representing general insurance firms, the Insurance Council of Australia, as well as plenty of other big donations from individual insurance companies and other banks. And that does not include the large amount of political donations that are disguised or hidden.

Of course, the banks and insurance companies also made big donations to the Liberal Party too. The Insurance Council of Australia gave them $27,500 and Anna Bligh’s Australian Banking Association the same amount. For its part, CBA donated $55,000. Westpac Bank donated a hefty $82,500 to the Liberals but that pales against their $2.5 million donations to the ALP during 2018-19. Likely, the Westpac bigwigs knew that they already had the Liberals fully in their bag!

The Myth that the Big Corporations are Owned by “Everyday Australians” through Our Superannuation

The problem isn’t simply that the banks and other finance businesses sometimes engage in open theft from their customers and other deceptive conduct. It’s the normal working of these enterprises that is the main problem. Banks make their money by extracting fees from account holders and primarily by charging a higher interest rate on the loans that they give out than the rate that they pay depositors. And they leach a lot of money that way! In the 2018-19 financial year, the “big four” Australian banks and the three biggest Australian-owned insurance companies, IAG, Suncorp and QBE, together extracted nearly $29 billion from us and that’s not including the huge amounts also grabbed by smaller banks and insurers as well as by mortgage brokers, consumer lease providers and payday cash operators. And that was considered a bad year for them! All this money extracted by the finance sector businesses is like an extra tax on the masses. But it is a tax where the proceeds don’t go into the public budget but into the hands of the wealthy finance sector business owners. If we note that there are currently about 9.8 million households and then do a quick calculation we find that the biggest four Australian-owned banks and largest three Australian-owned insurers are leaching $3,000 in profit, on average, from each household every year. To put that in perspective, that is more than one in five dollars of what an unemployed single person receives in the Newstart Allowance (if one excludes the temporary increase to the Newstart Allowance granted during the Covid-19 pandemic)!

Most working class and middle class people are only too aware that “The Banks” are ripping us off. But who do we exactly mean when we talk about “The Banks” that leach from us. Most of us think of the CEOs and the directors that award themselves huge salary packages. And with good reason! Last year, Westpac’s CEO took home over $5 million, ANZ CEO Shayne Elliot even more and IAG CEO Peter Harmer topped the lot receiving a five and a half million dollars package. And that was all in a year when the bank bosses, aware that they were under the spotlight, wanted to pretend that that they were feeling contrition for their devious deeds by awarding themselves lower payments than usual!

Yet as obscene are the payments are to the bank executives, that is still only a small percentage of bank profits. Where else are banks gigantic earnings going? Certainly not to their rank and file employees! So let’s take a look at Australia’s biggest bank, CBA. Last financial year CBA had a total operating income of $24 billion. Some of it they spent on equipment, wages, occupancy and operating costs. Most of their income then, after paying tax, ends up as profit for their owners. Nearly $8.5 billion to be precise. Of that nearly a billion went to beef up the assets of the bank to help its owners make greater profits in the future and $7.6 billion was given as dividends to the banks shareholders, i.e. to the banks owners. That’s who is taking most of the wealth extracted from the masses by the banks. By contrast, the more than 48,000 employees of the CBA received $5.5 billion in salaries and superannuation, which is a lot less than the shareholders received for doing absolutely no work at all. The amount received by the bank employees is also less than a quarter of the bank’s overall operating income. And of these more than 48,000 employees, the majority of them, the rank and file employees – say at least 40,000 of the workers – would each receive small slices of the salary cake while the managers and executives each take gluttonously big slices. After all, the bank’s top executives and other directors (there are just 20 of them), alone were paid $40 million last year; and that is counted as a “staff” cost. By contrast the average salary package, including superannuation, of CBA’s other employees is $114,000 – which is 40 times less than what the CEO took home. Moreover, when you exclude the managers and others in the top 20% of highest paid staff who would bring up that average income number, one would find that the annual wage of the vast majority of CBA workers wouldn’t be much more than – and in many cases less than – $75,000 and certainly well below $100,000. Moreover, to the bank bigwigs, these bank workers are expendable. As soon as the bank bosses decide that they can make a still higher profit with fewer workers, they will throw into the dole queues the employees whose hard work has allowed bank executives and big shareholders to acquire such immense wealth. Over the last several years, the bigwigs of the big four banks have together retrenched tens of thousands of workers. In late 2017, then NAB CEO, Andrew Thorburn, infamously announced the axing of 6,600 jobs at the very same time that he gloatingly announced that the bank had made a whopping annual profit of $6.6 billion.

So, who then are the shareholders who are reaping the rewards of the banks’ ripping off of the masses’ money? The finance corporations’ bosses and their bigwigs try to sell us the line that their companies are owned mostly by superannuation funds and through the dividends distributed to these funds their profits end up going to “ordinary, everyday Australians.” Nothing could be further from the truth! But before exploring this point in more detail, it is important to here make a point about superannuation more broadly. Superannuation, as a means of distributing income to the aged, in contrast to pensions, is not fair. It is not fair not only in practice but in the very concept of it.

Under the superannuation system a proportion of people’s income (9.5% of their gross wage currently) when they are working goes into their personal accounts which gets managed by superannuation companies and is then accessible when they retire. So a worker on the minimum wage in a full-time job gets $3,467 of superannuation put into their account each year. By contrast, the Westpac CEO last year received $44,320 in superannuation payments, nearly 13 times more than a worker on the minimum wage gets. Many bosses get even more. Last year, the CEO of Australian-owned mining giant, BHP, received a staggering $425,000 in superannuation payments – that’s more than 120 times greater than what a worker on the minimum wage gets! By contrast if you are a worker unfortunate enough to be either unemployed or one of the increasing number of cash in hand workers or a domestic worker or a casual worker who gets only a few hours in a month of work you get no super whatsoever. Yet it is precisely these people who need higher payments when they are aged because they would have much less savings and assets than people who had been receiving higher superannuation contributions. Moreover, the superannuation system reinforces the discrimination in employment affecting women, Aboriginal people and migrants from African, Middle Eastern and Asian countries. For in addition to the gender pay gap that women endure, the racist discrimination that causes Aboriginal people to have a much higher rate of unemployment than the broader population and the greater propensity of migrants to only be given lower paid jobs, women and migrants are much more likely to be in non-super receiving cash in hand and domestic work jobs than their male and Australian-born counterparts.

There is one rationale for superannuation – that wealth produced today needs to be set aside for when we have an ageing population in the future – that does have validity. But this should be addressed by making the bosses pay into a single, common pension fund out of which aged pensions can be paid equally to all of the elderly. Instead of the system of low pensions supplemented by people’s individual superannuation accounts, there should be much higher pensions for all and no individual superannuation. At least when a group of people are at an age when none of them are working, they should finally get paid equally! The current system, instead, carries through all the terrible inequality when people are of working age through to when people are retired.

So given how unequal people’s superannuation balances are, even if it were true that the banks and other big corporations are owned mainly by superannuation funds this would be grossly unfair. However, the truth is even more inequitable. For it is the very rich who own most of the stocks of the banks and other big companies. Superannuation funds own just a minority. How small a minority? Let us calculate that here using publicly available data. Given how much mythology there is about superannuation funds owning corporations, we will show each stage of the calculation. According to the Association of Superannuation Funds of Australia, i.e. the industry body of the superannuation companies themselves, at the end of December 2019 these funds had a total of 1.9 trillion dollars in assets of which 22.0% was invested in Australian equities (https://www.superannuation.asn.au/resources/superannuation-statistics , accessed 3 April 2020). That comes to a figure of $418 billion for the total holdings in the Australian share market by the superannuation funds. Now the total market capitalisation of the Australian share market at the same time, the end of December, was $2339.71 billion (see https://www.gurufocus.com/global-market-valuation.php?country=AUS and scroll to 20 December 2019 in the graph “Australian Total Market Cap”). That gives the proportion of the shares in the Australian stock market owned by domestic superannuation funds at just 17.9%. That is a lot less than one in five shares.

To see the significance of this truth that local superannuation funds own just a minority of major Australian corporations, let us consider the following scenario. Imagine in the year 2022, after having to prune their profits slightly in 2019 following the exposure of some of their fraudulent practices and the lower profits that they could expect in the coming two years in the wake of the COVID-19 induced recession, the banks seek to raise their profits back to the extreme levels of a few years ago. Through hitting their customers with still higher fees and by charging a high interest rate on the loans they lend out relative to that which they give to depositors the banks raise their profits by, say, an extra $10 billion. Now the bank bosses and their many apologists in parliament would then spin the line that these higher profits are a good thing as they end up in the pockets of “ordinary everyday Australians” through the dividends being accumulated by superannuation funds investing in the banks. However, if all these additional profits end up being distributed as dividends to shareholders and assuming that the percentage of bank shares owned by Australian super funds is about the same as the overall proportion of Australian stocks owned by these funds, just $1.79 billion of these extra share dividends would go to these funds. Even less would make their way into actual superannuation accounts. For the superannuation companies would take a healthy portion of the dividends as commissions and fees – and as we know even as advice fees when they give no advice! And guess what, many of these superannuation companies are themselves directly owned by banks or insurance companies. So part of the bank profits supposedly going into superannuation funds end up going back to the bank and, thus, into the pockets of its big non-superannuation shareholders. The amount actually going to the superannuation accounts of the public may be closer to $1.4 billion. Yet, to get to this scenario of higher bank profits, we have paid out $10 billion in extra fees and higher interest payments. So, excluding the big shareholders of the banks, the public end up much worse off overall, worse off by about $10 billion less the approximately $1.4 billion that we reclaim in higher returns on our super; i.e. we together end up about overall $8.6 billion worse off. And it is working class people who would suffer the pain disproportionately. For a low-paid worker, while paying the higher fees and higher interest rates paid by others, gets very little back in the way of higher returns on their superannuation and many workers none at all.

While we are dealing with this subject, the same analogy would apply to the issue of wages and profits. If the bosses managed to drive down our wages throughout the economy so that they collectively make a $10 billion higher profit than they otherwise would, the apology that business leaders give, that this ends up back in workers’ pockets through increases to their superannuation, is completely false. Wage and salary earners would collectively end up about $8.6 billion worse off. And again the pain would be borne most by lower paid, cash-in-hand and unemployed workers. So, the next time a co-worker, who has been influenced by ruling class propaganda, tries to tell you that higher profits for banks and other corporations is good for us, please, please, please educate them about the reality!

Who are “the Banks”?

So now that it is clear that we are not the indirect owners of the banks through our superannuation funds, who then are the actual owners of these hated corporations? The second lie that apologists for the banks promote, other than the one about superannuation funds, is that the banks are simply owned by “ordinary, everyday Australians” – so called “mum and dad shareholders.” This is actually an even bigger lie than the first one! Why? Firstly, most working class people don’t have the significant savings that would enable them to invest in the stock market. Low paid workers, unemployed workers and casual workers struggle to replace worn out clothes, deal with high electricity costs, pay the rent and often keep up with credit card debts too, let alone save significants amounts of money. Meanwhile, more decently paid workers often spend most of their working life paying off their home mortgage. Far from the majority of the working class being able to invest in shares, the reality is that household debt in Australia is at record levels. A small layer of better paid, more skilled and often older workers do sometimes invest in shares or alternatively in wealth management schemes that in turn invest in shares. However, most of the people holding shares are members of the capitalist, business-owning upper class and the more comfortable layers of the middle class – especially high-paid, upper-middle class professionals. So the “mum and dad shareholders” who supposedly hold most of the banks should more precisely be referred to as the “affluent mum and dad shareholders.” However, even this tells only a small part of the story. For average middle class shareholders – and even the upper middle class ones – while they are large in number only hold a very small portion of bank ownership. To see this, let us have a look at the latest annual report, the one for 2019, for Australia’s largest bank, CBA. According to the bank’s own report, those owning less than a 1,000 shares, who make up nearly three quarters of shareholders, own just one in ten of all shares. Now, given that the share price of the bank at the time that those figures were quoted for (15 July 2019) was $81.06, any one shareholder who was not in this category, i.e. was a shareholder who had more than 1,000 shares in the bank, had more than $81,060 invested there. These big investors who each invested more than $81,060 in the bank own 90% of the bank. Few workers and average middle class people could afford to put that kind of money in the shares of one company. Moreover, even amongst the upper middle class and wealthy capitalists who own most of the bank shares, it is the latter who own the lion’s share. Thus, the people and institutions who own more than 5,000 shares – that is who have the spare cash to invest more than $405,000 in the shares of just one company – own over two-thirds of the CBA. Moreover, the top 20 shareholders alone own nearly half the bank!

So who then are these very rich individuals owning most of Australia’s banks? That is censored information! The wealthy own much of their stakes in the finance sector through other banks acting as nominees for them. In other words, these rich investors get other banks to hold shares on their behalf in a way that hides their own identities. Without exception, in Australia’s big four banks at least the top six shareholders in each bank are these bank nominee holders. In the case of ANZ, all the top eight shareholders, who own 57% of the bank, are these nominee holders. That about typifies the nature of “democracy” within capitalist countries. The ruling class talk a lot about “transparency” but really it is only things that don’t matter too much that are transparent whereas the really important stuff is hidden from the masses. So here we have the most powerful economic institutions in the country, the ones who decide how credit is distributed and whose combined assets of $3.4 trillion (for the big four banks alone) are almost twice the country’s entire annual GDP … and we don’t even really know who owns them!

We do, however, know a few things about the major owners of the Australian banks and insurance companies. One thing that we do know is that they are rich Australians rather than people from overseas. CBA, for instance, is nearly four-fifths Australian-owned. You can bet that among the major owners of the banks and insurance companies, hidden through bank nominee holders, are many of Australia’s richest 200 people – capitalists whose combined wealth last year was found to be a staggering $342 billion! So if you managed to break through the secrecy wall of nominee holdings you would surely find that among the major shareholders of the banks would be people of the ilk of Andrew Forrest, Gina Rinehart, James Packer, Anthony Pratt, Clive Palmer and Kerry Stokes.

The $160 million mega-yacht bought in 2017 by financial executive John Symond. Symond is one of the largest individual shareholders of the Commonwealth Bank of Australia. The ultra-rich Australian owners and executives of Australia’s banks and other finance sector companies leach billions off the masses while the institutions that they control misdirect credit away from the areas most needed by working class people.

Where there is greater transparency is in the holdings of the executives and directors of these finance sector corporations. And they do have big shareholdings. ANZ CEO, Shayne Elliot, held nearly $5 million of shares in that bank. IAG boss, Peter Harmer, owned an even larger stake in his corporation, owning $7.6 million of shares. However, compared to the murky holdings held in secret by nominee companies, even these huge numbers are pretty small. One big bank shareholder who is not hidden behind a nominee company is the couple, Barry and Joy Lambert, who at the time of the CBA’s last annual report owned a whopping $220 million dollar stake. Joy and Barry Lambert are indeed, by the way, a “mum” and a “dad” – and these are precisely the type of “Australian mums and dads shareholders” that own the lion’s share of this country’s banks and other major corporations!

The Big Banks, Big Insurers and the Owners of Smaller Finance Companies

What about the institutions holding major stakes in the big finance corporations – that is, other than the companies acting as nominees for others? One such institutional investor, which is among the top twenty shareholders of each of Australia’s big four banks as well as of the big insurers, Suncorp and QBE, is Netwealth Investments. If we look at the last annual reports of these big finance corporations, we find that at that time, Netwealth held a total stake of $814 million in them. Now Netwealth Investments are a wealth management firm, so they are largely investing the money of other capitalists and upper middle class individuals in the big finance corporations. But Netwealth also takes a big chunk out of the money invested through these shareholdings as commissions and management fees. And who owns Netwealth? More than half of it is owned by the joint managing directors of the firm, Michael Heine and his son Matt. The last published Australian rich list has the family holding a combined wealth of more than $1.5 billion. As we can see, a big part of this wealth comes from grabbing a share of the profits that the banking and insurance corporations leach out of all of us.

So there you have it, the big banks and insurance companies act as a big collective feeding trough for capitalist pigs. Different capitalist exploiters come to put their snouts into the mega-earnings extracted by the big banks and insurers. And when they do so, they get a huge feed. The last CBA annual report, for example, boasted that shareholders gained a total return on their investments of 21% in just one year. That means, for instance, that the Lambert family’s stake in the bank would have given them a $46 million return in just one year … and that from doing no work whatsoever! By contrast a full-time cleaner doing hard and especially crucial and dangerous work at this time of pandemic will get 1,200 times less than this and only if her boss actually pays her the minimum wage.

The Heine family who own Netwealth are one of many owners of smaller finance sector businesses that have made a fortune by engaging in a similar kind of parasitism as the big banks do. At least fifteen of the people on Australia’s list of the richest 200 people extracted much of their money by running such enterprises. You very often see these people being interviewed on ABC current affairs programs related to the economy, which is worth noting for anyone who thinks that the ABC is substantially fairer and more independent of capitalist influence than the tycoon-owned media outlets. Among the finance sector bigwigs are Hamish Douglass, the biggest shareholder of wealth management firm, Magellan Financial; Jeff Chapman, owner of Bennelong Funds Management; Graham Tuckwell, owner of investment management firm, ETF Securities; David Paradice, owner of Paradice Investment Management and Kerr Neilson, the billionaire who owns the main stake in Platinum Asset Management. Supporters of public housing may recognise the latter name. Neilson was one of the ultra-rich people who notoriously bought up former public housing and publicly-owned buildings in Sydney’s inner-city Millers Point after the right-wing NSW government drove out low-income working class tenants and sold off the housing to wealthy individuals and speculators. In 2018, Neilson bought up three historic dwellings in Millers Point, known collectively as the George Talbots Townhouses, for $5 million.

The $30.5 million Point Piper mansion bought in 2014 by Nick Langley, owner of investment management firm RARE Infrastructure. Australia’s banks and other finance sector companies are largely owned by filthy rich capitalists and not by “everyday mum and dad shareholders.”

Another filthy rich owner of a finance sector corporation is the boss of buy-now-pay-later company, Flexigroup, Andrew Abercrombie. Abercrombie is also a Liberal Party powerbroker and major donor and is notorious for having stridently supported right-wing extremist, media commentator Andrew Bolt, when Aboriginal people took legal action against Bolt over vile racist slurs. Recently, Abercrombie was in the news after a high-society party that he hosted at his extravagant chalet in the US Aspen ski resort became the source of COVID-19 infection clusters after several of the super-rich guests refused to self-isolate and after returning to Australia spread the disease acquired at the party to Melbourne, Victoria’s Mornington Peninsula and Sydney.

Many of the finance sector bosses in Australia’s rich list run businesses that not only make profits from operations here but also leach profits from people overseas. That is to be expected from major components of a ruling class that is not only capitalist but imperialist. However, as well as making profits from their own operations, these owners of smaller finance sector companies stand alongside mining magnates, media moguls and industrial capitalists in grabbing hefty slices of the loot extracted by the operations of the big banks and big insurers. This is both through their own major shareholdings in the banks – like those of the Lambert family who made their initial wealth through Barry Lambert’s previously owned financial planning company, Count Financial – and through gaining a big slice of the dividends from bank shares received by the funds that they manage. In this sense, the big banking and insurance companies operate like a legal, crime syndicate. Different, loosely connected capitalists come together through these corporations to jointly loot the masses.

Nationalize the Banks! Nationalize the Entire Health System!

The banks extract money from the masses in four different ways. The first two ways are obvious: through charging interest and fees and through exploiting the mental labour of their own workers. Thirdly, by lending to those buying investment properties, banks, from the interest that they receive, gain a share of the rent extracted by greedy landlords from tenants. There is also an important additional way that banks extract their revenue. For banks, insurance companies and investment managers put some of the money under their control into the shares and bonds of other businesses. In the case of banks they also make loans to these other firms. These other business bosses, whether they be those of manufacturing firms, retailers, developers, telecommunication and IT firms, transportation companies, mining corporations or agribusiness operations in turn make a profit through exploiting their own workers. Part of the wealth extracted from these workers is then returned to the banks as interest on loans and on any bonds held by the banks and also returned to finance sector firms more broadly as dividends on the stocks that they hold in these other companies. In this way, the owners of the finance sector companies gain a share of the profits exploited from workers throughout the economy.

This role of the finance sector – and the banks in particular – in the whole economy points to perhaps the biggest problem with the capitalist-owned finance sector. It is not simply that they leach from the people, it is also the way that they allocate credit and financial resources. And like everything else they do, they allocate credit almost solely on the basis of what can bring them the highest returns. That is partly why there is so much speculation in the housing sector and so little affordable housing available, both to buy or to rent. Banks know that they can gain much higher and more secure returns by giving loans to wealthy people buying multiple holiday homes and speculative high-end investment properties than to lend for the construction of cheaper housing for working class people to buy or to rent. Similarly, banks would rather allocate loans and investments to climate change-inducing coal mines and fossil fuel power stations that have little long term future than to focus their credit allocation into renewable power projects even if the former bring only slighter higher and more secure returns to the bank. Meanwhile, the profit-driven mode of the banks mean that medical research in Australia can struggle to get funding unless the chances of an immediate profit-making breakthrough are immediate. Yet medical science cannot but advance except through the trialling of many different ideas, only a tiny proportion of which will end up being used. Similarly in Australia, important technological development and scientific research – especially in basic sciences where the monetary benefits are not immediate – struggle to get bank loans or investment. By contrast, casino operators and advertising firms – who produce no net benefit to society but instead only help one lot of business owners to get richer at the expense of their rivals (and then vice versa!) – don’t seem to have any trouble raising credit.

One of the growing number of people in Australia forced to sleep the streets. A major reason for the large amount of homelessness is that Australia’s profit-driven banks, rather than directing credit to the building of public housing and housing affordable for the poor, divert credit to more lucrative high-end housing projects as well as for speculative housing investments.
Photo credit: ABC

If the misdirection of credit causes terrible problems in “normal” times, it can be literally fatal at a time of public health emergency and economic implosion like we are experiencing right now. Although, as we go to press, the rate of new infections in Australia appears to be slowing, people continue to die from COVID-19 and, what is more, the threat of much greater virus spread will emerge once social distancing measures are eased. That is why immediately, we need financial resources directed to urgent medical research to help find vaccines and better treatments for COVID-19. We need this research not only for the few projects seemingly most likely to bring financial profits in the future but for a wide range of research. That includes work into developing any non-vaccine treatment methods for the virus. Such research into treatment methods can be hugely life-saving but its results are also likely non-patentable and would bring the researchers – and thus their bank creditors – no real financial rewards. Even more urgently we need loans directed to particular manufacturers that are able to very quickly turn their factories into making personal protective equipment, infra-red thermometers, virus testing kits and ventilators. We also need credit being allocated into areas that will help reduce the level of job losses and at the same time direct jobs into areas that would aid the virus response – for instance by making home delivery of groceries and food more widespread. Yet the only way any of this has even a chance of happening is if control of the organisations that have the power over lending – that is, the banks – are taken out of the hands of their profit-driven owners and brought under state control. This gives the potential to plan the allocation of financial resources to both respond to the virus threat and avert economic collapse. For such planning to be effective, the banks really need to be run together as a single national entity. Modern computing technology and big data make that quite simple whether or not the banks actually operate under one logo. In summary what we need is the nationalisation of the banks and their conversion into a single state-run bank. We need that right now and we need that all the time!

Putting the banks under state control is not the only thing that the working class masses need right now. To respond to the COVID-19 threat we need health resources mobilised in a planned way. The government has announced that it would requisition the resources of private hospitals to deal with the crisis. But this measure is partial and predicated on a massive bailout of private hospital owners. In contrast to the Morrison government’s half-baked hospital plan we need the immediate nationalisation of the entire health system – including not only private hospitals but smaller health facilities like pathology labs. This must remain even after this epidemic is over. Having a big part of the Medicare budget going into the bank accounts of greedy private health operators – for example, Medicare pays 75% of the schedule fee of private patients – as opposed to the actual treatment of patients not only drains the public budget but means that less resources are available for the long overdue tasks of increasing the number of available public hospital beds and public health nurses and reducing the waiting times at public hospitals. Furthermore, for the level of one’s access to health care to depend on the “logic of the market” – in other words how much money one has to fork out for health care – goes against the needs of the working class and all principles of decency. The irrationality of having health facilities being run by for profit operators has been proved during this COVID-19 crisis by the fact that private health care operators like Healthe Care in March stood down, or laid off, hundreds of nurses at a time when the virus was spreading rampantly and nurses were needed more than ever.

The section of Australia’s population most vulnerable to contracting COVID-19 is the well over hundred thousand homeless people. This includes not only those forced to sleep the streets but those “couch surfing” in the homes of friends and relatives. With so many people thrown out of work or stood down on reduced or no pay, homelessness is set to skyrocket. The government’s tentative six-month moratorium on evictions does not provide adequate security to tenants. There are so many loopholes that landlords are already evicting tenants. Moreover, current measures do not stop landlords and estate agents from pressuring tenants to pay rent even when they have little income. Therefore, there must be a six month halt to all rent payments for residential tenants from now. We also need an immediate halt to the sell-off of public housing and for homeless people to be housed in public housing dwellings slated for sale. This will help but will not in itself be enough to house all homeless people. Therefore, we also need a massive increase in public housing. Another crucial reason why we need more public housing is so that low-income women can move away from any abusive relationships and know that they will still have a roof over their heads if they do so. This is an even more urgent matter now than ever as COVID-19 restrictions are leaving women copping domestic abuse in situations where they are more socially isolated and, thus, more vulnerable to violent attack. But new public housing cannot be built fast enough right now in the midst of a pandemic. Therefore, the state must requisition the unoccupied holiday homes and investment properties of people owning more than three homes and convert them immediately into public housing.

We must also demand that the millions of casual workers in this country be immediately granted permanency with all the rights of permanent workers – including being granted guaranteed minimum work hours and sick leave. This is necessary to both protect the rights of casual workers and to ensure that such workers have no compulsion to risk their own well-being and that of others by going to work when ill. Similarly, we must ensure that all workers be granted special paid pandemic leave for self-isolation, quarantining and treatment if they may have COVID-19, or to care for ill family members. The government’s new scheme only allows for unpaid leave which for many low-paid workers will not only cause hardship but may push them to try sticking it out at work when they could be a risk to themselves and others.

At this time of economic crisis, temporary migrant workers and wage-working international students are the hardest hit section of the working class. Many have lost jobs or are casual workers who have suffered big cuts to the number of shifts that they get and, like most casual workers, the government’s much touted scheme to pay bosses of businesses that have lost significant revenue to retain workers will not help them at all. Moreover, unlike all other workers they will not get any Centrelink payments and international students are not even covered by Medicare. This is outrageous! These migrant workers face destitution and many now not only have no money to return to their home countries but cannot even do so due to travel restrictions. That is why it is absolutely urgent that we demand that all workers resident here get the same rights as people who are citizens. Full citizenship rights for everyone who is here! Moreover, in counter-position to the government’s JobKeeper scheme that will still allow hundreds of thousands of workers to lose their jobs while giving a windfall to many bosses, we must fight for jobs for all through preventing companies that have been making a profit over the years from cutting their workforce and by forcing still profitable companies to increase hiring at the expense of their profits.

Such an agenda can only be won through working class-led struggle. Although, at this moment, it may even be from the point of view of the overall interests of the capitalist class partly rational to put the banks under state control in order to avert an economic collapse, the exploiting class will resist any demands for such measures, not least because such a nationalisation would immediately pose the question that if the capitalist owners cannot be trusted to run the banks themselves then why shouldn’t the banks and the rest of the economy be taken completely out of their hands and put into public ownership. As a crucial part of any working-class fightback the workers movement must champion the cause of all other sections of the oppressed. In particular the working class must support Aboriginal people’s struggle against racist state killings of black people in custody, a movement that has been injected with renewed energy in the wake of the mass anti-racist resistance struggles in the U.S.

Mass struggle at this time of pandemic is, of course, difficult. However, let’s not forget that the working class movement has had to struggle in the past – and often in the present too in not only openly capitalist dictatorships but to some degree in the so-called “democracies” as well – in difficult conditions where protests, strikes and leftist political activity have faced repression or even been outright outlawed. This time of virus-related restrictions is, of course, very different in that we ourselves uphold – and actually actively promote – genuine social-distancing measures. However, like in times of intense of police-state repression, it is still a matter of finding ways to overcome major obstacles. We certainly don’t need to come up with all the ways that we can have an impact here. Politically active working class people will themselves come up with suitable methods – the masses are very innovative and that has been proven over decades and decades of struggle.

State-Controlled Banks and COVID-19 Response: A Case Study

If anyone wants to see why we need to put the banks under state control they should look at how the finance sector works in the world’s most populous country – and Australia’s biggest trading partner – the Peoples Republic of China (PRC). In China all the major banks are nationalised. And that was part of why the PRC was so effectively able to respond to the COVID-19 threat. Although China was the place where the virus – whose exact origin remains unknown – first spread in a really big known way, the PRC was able to respond so effectively and quickly that today in China, and even in the city of Wuhan, the former centre of the outbreak, people are again socialising, starting to resume eating out at cafes and restaurants, travelling long distances on public transport, slowly returning to tourist sites, working at factories and other works sites and gradually returning to full school operations. More importantly, the PRC’s response has been so successful that per million residents, far less people have died from the virus in China than have died in wealthier countries that have had much, much more time to prepare for the virus spread. Thus, the number of deaths per resident as of July 18 is already 45% higher in Australia than in China, 133 times higher in the U.S. than in China and in Switzerland, the country famous for its free-wheeling, scantily regulated capitalist banks, the number of deaths per resident is already 71 times higher than in China.

It is important to see why the PRC has been able to respond so effectively to the virus threat. In particular let us see how having a nationalised banking sector made a difference. Crucially, as soon as it become apparent just how contagious and deadly the then newly discovered virus was, China’s banks started supplementing PRC government outlays to firms to boost production of – or in many cases to entirely switch over the output of their operations to produce – items crucial to the epidemic response. Such products included surgical masks, goggles and full protective suits for medical workers, face masks for the public, COVID-19 testing kits, ambulances, disinfectant and ventilators. Within two weeks, PRC banks had already lent out tens of billions of dollars in very low interest rate loans to support the production of these items. By March 13, the amount that the PRC’s state-controlled banks had lent out to contain the impact of the virus had grown to $330 billion!

Left: Medical workers in full head-to-toe, spacesuit-style protective gear at Wuhan’s Fan Cang Makeshift Hospital in February 2020. Right: Medical workers at Tasmania’s North West Regional Hospital. Australian health workers have usually not been provided with the same level of protective gear that medical workers in China have been equipped with. Often the faces and necks of Australian health workers are left exposed and sometimes they are only equipped with normal face masks rather than surgical grade N95 masks. As a result, the coronavirus transferred from infected patients to medical staff at Tasmania’s North West Regional Hospital causing an outbreak that took eleven lives. Moreover, as of 21 July 2020, 429 health workers have been infected with COVID-19 in Victoria alone. The capitalist system is unable to ensure the switching over of production to meet pandemic response needs anywhere as decisively as a system dominated by public ownership, like that in the PRC.
Photo credit (photo on Right): Mitchell Woolnough

The production of pandemic relief goods – especially PPE (Personal Protective Equipment) for medical workers – is absolutely vital in the fight against this pandemic. Unfortunately, in the very early days of the outbreak in Wuhan, before it was realised just how contagious the virus was – and even what it was – and how crucial was the need for protective gear, many medical staff in Wuhan became infected with the virus and also spread it to other colleagues, and several of the infected staff later died. In late January, with a large number of ill people pouring into Wuhan hospitals the hospital system in Wuhan was obviously overwhelmed and there was a shortage of protective gear, medicine and equipment. However, before long, with PRC manufacturers, armed with cheap credit doled out at lightning speed by her nationalised banks, rapidly switching over to producing protective gear, all nurses, hospital cleaners and doctors in China were wearing full space-suit-style head-to-toe protective gear. As a result, not a single one of the more than 42,600 health workers who travelled from other parts of China to Hubei Province to aid the virus response became infected, let alone died from the disease. By contrast, the capitalist countries with their private, profit-driven banks have not been able to equip their health workers with PPE effectively. Capitalist banks resist any loans that do not guarantee them a sizable and secure return. Moreover, they would also take considerable time approving any loans made for epidemic response as they ponder and calculate what they can get out of lending large amounts to any particular project for manufacturing epidemic prevention materials. In Australia, any switching over of production to aid the pandemic response by manufacturers is happening way too little and way too late. Therefore, even though authorities in countries like the U.S., Australia and Italy have had the big advantage of knowing for several weeks, if not months, just how infectious the virus was before it spread widely in their own countries, they have not even been able to ensure adequate protective equipment for their health workers. In the U.S., many nurses have had to resort to wearing home-made “protective gear,” like garbage bags, as poor substitutes for personal protective equipment. In Italy, as of April 17, at least 159 medical workers had died from COVID-19. Apart from the personal tragedies here, the effects of health workers becoming infected is devastating for the overall pandemic response. It means that large numbers of medical staff are not able to contribute to the response effort as they languish in quarantine, while other doctors and nurses, before they are identified as having COVID-19, end up passing on the virus to other medical staff and to patients who have come in for non-COVID-19 illnesses. In Australia, the failure to be able to outfit all health workers with the head-to-toe PPE that China’s nurses, doctors and janitors are equipped with has meant that as of July 18 over 400 nurses, doctors and health workers in Victoria alone have been infected. The failure to provide adequate PPE for health and aged care workers is also a key reason for the deadly virus spreads in North-West Tasmanian hospitals and in the Christian-run nursing home in Sydney’s Outer West that took the lives of 30 people between them.

Build toward the Future Confiscation of Banks, Industry, Mines, Communications Infrastructure and Agricultural Land and their Transfer into Public Ownership

It is not only in responding to the direct virus threat that the PRC’s nationalised banks have come into their own. To avert mass layoffs and economic shocks during this pandemic, China’s banks have sacrificed profits by rolling over and extending loans to hard-hit firms and self-employed people and by lending large amounts of money at low interest rates to assist enterprises to re-start production with the curbing of the epidemic spread. In a similar way, the PRC’s nationalised banking sector played a crucial role in allowing China to sail through the late noughties Global Recession as they lent huge amounts of money to finance high-speed rail lines, water conservation projects, environmental projects and the massive construction of low-rent public housing.

Yet it is not just during a crisis that the advantages of the PRC’s state-controlled finance sector is apparent. These Chinese banks have been directed to ensure that their lending practices are in lockstep with the PRC’s “Homes Are For Living In, Not for Speculation” policy. Thus, they have provided much credit to support public housing construction. Moreover, very different to Australia’s profit-obsessed banks, China’s banks charge any family seeking a bank loan for buying a second home a much higher interest rate than they charge those buying their first home, while they don’t lend at all to anyone trying to buy a third home. More broadly, China’s state-controlled banks are directed to lend to projects that may not be very profitable for the banks but which are important for the society and for the people’s economic development. Thus, these banks have specially lent to research and development projects in areas that are important for that country’s future economic progress like nanotechnology, advanced materials, artificial intelligence, advanced electronic hardware, aircraft research etc. Meanwhile, given that the PRC state has identified environmental protection as one of its three principal tasks, alongside poverty alleviation and curbing financial risks, the banks have directed a significant part of their lending to projects aimed at curbing water and air pollution. In particular, by supporting renewable energy projects with credit, they have helped China to become the world leader in renewable energy, with more than three times the installed solar power capacity of any other country and more than twice the wind generation capacity of the next biggest wind power producer. However, the most crucial practice of the PRC’s nationalised banking sector is its support for the country’s poverty alleviation drive. Over the last several years, as part of the PRC’s drive to lift every resident out of extreme poverty by the end of 2020, China’s state banks have lent literally hundreds of billions of dollars to poverty alleviation projects in poorer parts of the country. Many of these projects involve renovation of shantytowns and upgrading of infrastructure in impoverished and remote parts of the country as well as supporting community-based aged care facilities provided for lower income residents. Crucially, the PRC’s state-controlled banks have also provided credit for the development of job-creating industries in poorer, rural parts of the country including food processing operations, agricultural co-operatives, rural tourism and renewable energy projects. Partly as a result of such support for her poverty alleviation drive from her nationalised finance sector, China remains on track to achieve her poverty alleviation target by the end of this year despite the impact of the COVID-19 pandemic.

It is important to be aware that the PRC’s banks are not just state-controlled, they are overwhelmingly also state-owned. Thus, each and every one of China’s big four commercial banks are state-owned. Indeed, even if we include all the medium-sized banks in China, we find that majority state-owned banks so dominate the PRC’s finance sector that there is really only one significant sized bank – China’s tenth largest bank – that can be considered to be truly privately-owned; and even in that one case state-owned companies have recently become its largest shareholders owning around a quarter of the bank. Moreover, in addition to her commercial banks, the PRC has three massive, 100% state-owned policy banks whose lending is completed devoted to projects that are deemed in society’s overall interest. Two of these policy banks in particular, the China Development Bank and the Agricultural Development Bank of China, whose combined assets would make them China’s second largest bank, have been at the forefront of lending to support China’s poverty alleviation drive and more recently for the pandemic response effort.

There is a notable difference between banks being merely state-controlled and being actually state-owned. For one, even if banks are state-controlled, if they remain privately-owned their wealthy owners will act as a constant pressure on the state pushing for the banks to be run largely according to the profit motive as opposed to according to social needs. Secondly, if banks remain only state-controlled their massive profits would still be flowing into the hands of their largely ultra-rich owners rather than into the public budget. Remember, last year, in a “bad” year for them, Australia’s big four banks alone leached $26 billion in profits. To be sure, if they became state-controlled their profits would drop somewhat as their lending and investment becomes partially re-directed away from areas that simply bring the highest return. Nevertheless, even if their profits were halved as a result of being placed under state control, that’s still $13 billion that could go into the public budget if these corporations were only brought into state ownership. How much badly needed public housing could we get with that?! Well, actually, we can calculate that. According to the government’s own figures (see Table 18A.43 in the appendix of Excel spreadsheets under Part G, Section 18 of the Report on Government Services 2020 in the Australian Government Productivity Commission website https://www.pc.gov.au/research/ongoing/report-on-government-services/2020/housing-and-homelessness/housing), the average annual cost of a public house unit, including the capital cost, is $39,714 per dwelling. So if we had even half the current profits extracted by the biggest banks in Australia go into the public coffers we could support an extra 327,340 public housing dwellings which would easily more than double the existing stock of public housing. That could really solve the problem of homelessness and make good strides towards addressing the extreme shortage of low-rent housing in Australia.

That is why what is finally needed is to confiscate all the banks, insurance corporations, superannuation companies, wealth management firms and securities businesses from their ultra-wealthy owners and bring them all into state-ownership. This should be accomplished without giving any compensation to the big shareholders. However, to avoid unnecessarily antagonising the middle class, the stock holdings of the numerous small shareholders who together own a tiny fraction of these corporations can be bought out. Since the superannuation firms will be confiscated too, workers won’t need to worry about losing their super when the banks get taken. They will still get their retirement funds from the now publicly owned providers and with less eaten in fees by billionaire finance sector bosses to boot. However, the retirement payment system will progressively be switched from one based on individual superannuation accounts to one based on a higher and equal pension for all.

Our agitational demand to put the banks under state control, that is to nationalise the banks, that we made in the headline of this article, is not in itself a call to confiscate the banks and put them into public ownership. Russian revolutionary leader Vladimir Lenin made a similar call some six weeks prior to the working class seizure of power in the October 1917 Russian Revolution. As Lenin explained:

It is absurd to control and regulate deliveries of grain, or the production and distribution of goods generally, without controlling and regulating bank operations….

The ownership of the capital wielded by and concentrated in the banks is certified by printed and written certificates called shares, bonds, bills, receipts, etc. Not a single one of these certificates would be invalidated or altered if the banks were nationalised, i.e. if all banks were amalgamated into a single state bank…. whoever owned fifteen million rubles would continue after the nationalisation of the banks to have fifteen million rubles in the form of shares, bonds, bills, commercial certificates and so on.

— V.I. Lenin, The Impending Catastrophe and How to Combat It, September 1917

Lenin’s Bolsheviks made the demand for the nationalisation of the banks in this period as an urgent measure to control economic life at a time when Russia’s masses were being struck down by mass unemployment, disorganised industry and terrible shortages of food and other staple items. However, the revolutionaries also understood that by showing the masses the need to take the control of the banks out of the hands of the capitalists they were thus leading working class people to the conclusion that they ultimately need to also take the ownership of the banks from the capitalists. Indeed, in the period after the October Revolution, the new workers government of Soviet Russia confiscated the banks along with the railways, industries and agricultural land and transferred them into public ownership.

Putting the banks under state control or even confiscating the finance sector, while a vital measure, does not solve all problems – not even the most urgent ones. So while we need state banks to lend to certain manufacturers to aid them to switch their operations to produce vitally needed pandemic relief goods, if the manufacturing bosses still can’t find a way to make a big profit out of those operations, even with low-interest loans, they are very unlikely to change over their factories; and if they do many would do it too slowly or only in a token way to gain positive publicity. So we need to have a perspective of confiscating not only the finance sector but also taking the key industries, the mines that produce the raw materials, transport and distribution means, power, communications and other infrastructure as well as construction out of the hands of the profit-driven capitalists and placing them into the collective hands of the people. In China it is not just their banks that are under state-ownership but all their key sectors. As a result when there was a need for firms to switch over their production to make pandemic relief goods, the relevant state-owned enterprises not only got access to cheap credit to assist them but were basically ordered to make the conversion. That is why you have all sorts of Chinese industries, seemingly unrelated to making protective and medical gear, contributing to China’s pandemic relief effort. For example, state-owned Shanghai Three Gun group, China’s biggest producer of underwear, is now producing more than one million masks per day.

What a society where public ownership plays the backbone role can do was seen most clearly in the way that the PRC built two large brand new hospitals from the ground up in less than two weeks when the number of people getting seriously ill from COVID-19 started surging in late January. The challenge in building these hospitals in Wuhan so quickly was especially steep given that these specialist infectious disease hospitals, unlike other hospitals, needed to have negative pressure wards to ensure that the air leaving wards with the infected patients is ejected safely rather than seeping out to potentially infect hospital workers and others. The first of these hospitals put into service, the 1,000 bed Huoshenshan (“Fire God Mountain”) Hospital was built in just 10 days. The second, the 1,600 bed Leishenshan (“Thunder God Mountain”) Hospital was put into service just days later. And it was thousands of workers organised through the PRC firms under public ownership that played the key role in pulling off these amazing feats. Financing for the project was provided both from the central government and by the 100% state-owned policy bank, the China Development Bank. The design of the hospital was performed by the CITIC General Institute of Architectural Design and Research, a subsidiary of the giant PRC public-owned conglomerate, CITIC. The actual construction of the hospitals was undertaken by the Third Engineering Bureau of state-owned China State Construction Engineering, the largest construction company in the world. Meanwhile, China State Grid organised 260 workers in around the clock shifts to ensure that the power connection was ready in time. Communications within the hospital and a stable 5G internet connection was achieved within 36 hours through a collaborative effort of China’s state-owned communication giants China Mobile, China Telecom, China Unicom and China Tower. Meanwhile, CT scanning equipment and X-rays were provided by Shanghai United Imaging, a high-tech firm jointly held by a range of PRC state-owned firms.

18 February 2020: One of the first two patients to recover from COVID-19 at the Leishenshan infectious disease hospital in China’s Wuhan says farewell to nurses and doctors. The specialised 1,600 bed Leishenshan Hospital was built in less than two weeks by the Third Engineering Bureau of China State Construction Engineering, one of China’s huge socialistic state-owned enterprises.

Right now the mass of working class people in Australia does not yet appreciate the need for the confiscation of the banks and industry from the capitalists and their transfer into public ownership. The very most politically advanced workers and leftist activists do understand that this is what is needed. However, ruling class propaganda has been able to tentatively convince the majority of working class people that private ownership of the economy should be “respected.” Nevertheless, right now there is widespread distrust of the banking system at the very same moment that many working class people are very worried about the pandemic, about whether they will have a job and about their ability to pay rent and buy essentials. That is why we today emphasise the call for the nationalisation of the banks as a slogan around which to mobilise united front struggle that will, on the one hand, demand this immediate measure necessary for both the COVID-19 response effort and to protect the masses from unemployment and poverty and that will, on the other hand, in the course of their struggle to win this demand, point working class people towards the ultimate need for the confiscation of the banks and all key sectors and their transferal into public ownership.

We Need a Workers State

If powerful working class struggle were able to force the capitalist government to nationalise the banks, the question then becomes posed: who would be administering this now state-run finance system? Sure, a finance system under state control would face more mass pressure to run its operations according to people’s interests than privately owned banks do. However, would you trust the anti-working class Morrison government or the desperate-to-not-scare-the-capitalists-Albanese led ALP to ensure that a state bank would actually serve the masses rather than the big end of town?

The problem is not simply the government but the bureaucracy. No matter the political stripe of who sits in ministers’ chairs and who wins elections, the fact is that the same layer of high-ranking state officials who have been allowing the finance sector corporations to fleece the public will still be the ones “regulating” them. The “regulator” of the finance sector, ASIC (Australian Securities and Investments Commission) has been so deferential to the finance industry bosses that even the limp Royal Commission criticised it for its “softly, softly approach” to illegal activity by the banks. However, ASIC is not going to fundamentally change. If you see who leads it, even now after getting a slap on the wrist from the Royal Commission, you will know why. ASIC’s leadership remains people with strong ties to the finance sector bosses and other corporate bigwigs. Thus ASIC chair, James Shipton, spent ten years as the managing director of various divisions of the Asia-Pacific office of American banking giant, Goldman Sachs. Of the six other commissioners who lead ASIC, one previously had senior roles in NAB and ANZ (and does anyone expect him to now go hard on them?!!), two had been top bosses of other finance services companies and one had been most recently CEO of the Myer Family Company.

Yet, it is not only their leaders’ previous links to the corporate bosses that tie state institutions like ASIC to the capitalist class. For one, the wealth that these ASIC heads would have acquired when they were high fliers in the banking and broader corporate world – and the ensuing investing of part of this wealth that they have no doubt made into shares and/or share-investing wealth management schemes – would make them very much identify their interests with those of the big end of town and not with working class people. Moreover, since wealthy business owners control the economy and, thus, largely determine who gets hired and at what pay, they can, without even saying a word, entice senior bureaucrats at state institutions with the prospect of future lucrative jobs at their companies should they “respect” their interests; and, in effect, threaten these state officials with being locked out of future employment prospects should these bureaucrats dare step on their toes. One only has to look at who are the directors leading the big finance sector companies and other corporations and one will see how this works. Let’s take ANZ bank as a case study. ANZ’s David Gonski, prior to being appointed chairman in 2014, had been a top official of a number of Australian state bodies. He had been head of the Future Fund which directs government investments into long-term projects. From 2010 to 2011 he also headed a government commission to look into education funding which produced the well-known Gonski Report. In the year prior to becoming ANZ chairman, Gonski had also been appointed to ASIC’s External Advisory Panel and actually continued there until last year. Consider this: say Gonski had, if he hypothetically wanted to, tried to direct Future Fund investments in a way that actually benefited working class people rather than the corporate owners, had in his Gonski Report called to slash public funding for private schools rather than agree to perpetuate it and while on ASIC’s External Advisory Panel pushed for a severe crackdown on the banks, does anyone think that ANZ’s big shareholders would have then appointed him their chairman? And wouldn’t being aware of how his future career prospects in the corporate world are affected by how he acts while heading state institutions colour his conduct when being a high-ranking Australian state bureaucrat? Actually, Gonski is not the only ANZ boss who had been on ASIC’s External Advisory Panel. One of ANZ’s top executives had previously been Vice-Chair of this ASIC body and the current chairman of Suncorp is still on that panel, all of which highlights further the links between ASIC and the finance sector bosses that they supposedly “regulate.” Meanwhile, an ANZ director had previously held the top bureaucrat position, Secretary, in both the Australian Department of Finance and the Australian Department of Health. This director, Jane Halton, is currently also one of the ten council members that lead the Australian Strategic Policy Institute, the state defence think tank notorious for being the most fanatical force promoting Australia’s military build up and its war-mongering hostility to socialistic China. This also highlights the fact that some capitalists hold key positions in the state machinery even while they are still directors of corporations. Thus, one of the NAB’s directors, is also a director of Infrastructure Victoria. Moreover, the chairman of the NDIS, Helen Nugent, is also a director of insurance corporation IAG. So if disabled and ill workers are wondering why they often face intrusive interrogations from the NDIS and sometimes even cop bullying threats to cut them off the Disability Support Pension just know this, the boss of the NDIS is a director of one of the leaching insurance giants who holds over $220,000 worth of shares in that corporation (according to their last annual report) and is paid by them almost a quarter of a million dollars a year for basically attending a meeting every 16 days (on average) and reading some reports. Prior to being appointed NDIS supremo in 2017, Nugent had been up until 2014 a director of Macquarie Group for 15 years. And controversially, the NDIS has awarded Macquarie a contract to build disability housing for them while Nugent actually conducts her leadership of the NDIS in an office rented from Macquarie!

Left: One of the ANZ Bank’s super high-paid directors is Jane Halton. As well as also being a director of James Packer’s Crown Resorts, Halton is one of the ten council members that lead the Australian Strategic Policy Institute, the government defence think tank notorious for being the force most fanatically promoting Australia’s military build up and its aggressive military posture. Through shared occupancy of leading positions, personal ties and the economic dominance of capitalist corporations, Australia’s capitalist class ensure that all state institutions are subordinate to their interests. Right: One of the many unarmed civilians being murdered by Australian SAS special forces troops in Afghanistan. This particular war crime took place in May 2012 in Uruzgan province. The unarmed person being executed in cold blood was a man in his mid-twenties known as Dad Mohammad, a married father of two young children.

The intertwining between the capitalist bosses and the upper echelons of the bureaucracy extends into state institutions crucial to shaping the ideological direction of society. Thus, much of the leadership of the universities is held by corporate bigwigs. The chancellor of UTS is, for example, none other than the chairman of CBA. Meanwhile the deputy chairman of the broadcaster SBS, George Savvides, is a director of IAG, while another member of the nine-member board that sets SBS’s direction, Peeyush Gupta, is a director of NAB. This is worth knowing in case anyone is tempted to believe that SBS is any more “independent” of the capitalists than the Murdoch media or the commercial TV and radio stations.

Through their economic power and wealth, the capitalists not only ensure that the upper ranks of the state bureaucracy are tied to them by thousands of threads – if they are not actually personally holding these positions themselves – they also subordinate to their interests all the other coercive bodies of the state. This includes the legal system. ASIC have not only been extremely timid when facing the banks because of their ties to the bank bosses. That is, of course, very true. However, part of the reason for ASIC’s prostration is that they are downright intimidated at the prospects of taking on the banks in the courts. Since the courts are biased towards the corporate bigwigs and since the bank bosses have enormous financial resources to hire the best, most expensive barristers and to fund expensive court proceedings and appeals, ASIC fears losing expensive court battles with the banks.

Left: Former Commonwealth Bank of Australia top executive, Annabel Spring. She had been responsible for some of the sections of CBA most responsible for charging customers fees for no service and for setting up dodgy insurance schemes with contracts so tightly worded that customers were basically ineligible to claim anything on the policies. In 2015, the then CBA wealth boss bought a Centennial Park trophy home (Centre) for nearly $10 million from one of NSW’s top judges, Antony Meagher (Right). Meagher is a judge at the Court of Appeal of the NSW Supreme Court, the highest court for civil matters in NSW. The high-paid judges, bureaucrats and other officials at the top of Australia’s state organs share much in common with the corporate bigwigs and have numerous financial, social and familial ties to them.

That is why alongside agitating for putting the finance system under state control, we need to fight for people’s supervision of the banks. We cannot trust state institutions tied to the capitalists to regulate even a state-controlled finance system. Therefore, we must demand – and indeed assert – inspection of all commercial bank transactions and big accounts by committees consisting of unionised bank employees’ representatives alongside of representatives of other unions and mass organisations. Such committees can call in financial experts as consultants to help make sense of information but the great advantage of having class-conscious finance sector employees involved in these inspections is that they themselves understand all the terminology of the finance world. These working peoples’ committees can then collate the information and highlight the key results – as well as egregious cases of fraud and manipulation by the very rich – to the public in a form easily understood by the masses. In that way the people can know to which businesses and which sectors credit is being lent and what is the proportion of housing loans going into homes for the debtors to actually live in as opposed to for the sake of housing speculation. Moreover, we will be able to finally discover who the exact owners of the finance sector corporations are. We will also be able to expose which wealthy capitalists have been hiding their true income to avoid tax and by how much. Similarly, the extent to which corporate bosses have been ripping off the public budget when acting as contractors for state projects as well as bribery of state officials by the capitalists can be exposed.

Thus, a state-controlled finance sector where working people’s committees make transparent to the masses the operations of a united state bank will enable the masses to exert enough pressure to have some control over this key pivot of a modern economy. Yet this will only be some control. For as long as the state as a whole – including its key coercive organs of the courts, the police, the prison, army, the regulators and the broader bureaucracy – remains the existing capitalist state that has been created and built up to serve the interests of the wealthy business owners then any attempt to exert workers’ control over the economy will face sabotage and obfuscation through bureaucratic means. As Leon Trotsky, leader of the Fourth International, which at the time (albeit with some mis-steps) continued the fight for the revolutionary internationalist program that guided Lenin’s Bolsheviks, emphasised in The Transitional Program, the program that the Fourth International adopted in 1938 at a time of acute capitalist crisis in the lead up to World War II:

“… the state-ization of the banks will produce these favourable results [large scale industry and transport directed by a public bank to serve the vital interests of the workers and all other toilers] only if the state power itself passes completely from the hands of the exploiters into the hands of the toilers.”

This is the goal that we must advance towards: the sweeping away of the capitalist state and the construction of a new state to serve the interests of the working class and all the other oppressed. The building of such a workers state is needed not only to ensure that any state bank truly operates for the masses but as the pre-condition necessary to enable the confiscation of all the backbone sectors of the economy and their transferral into socialist, that is public, ownership. For while the capitalist class, in a crisis, may, to save their system as a whole, nationalise some sectors and in other cases may acquiesce to some nationalisations as a concession to powerful working class struggle, they will never accept the wholesale dispossession of their ownership of the economy unless they are actually deposed from political power.

China’s Bank’s are Genuinely under Public Ownership because the PRC is a Workers State

It took the revolutionary overthrow from power of the capitalists, the agricultural landlords and the henchmen of Western imperialism in 1949 to enable China’s banks, industry, mines and agricultural land to be transferred into collective ownership by the people. The 1949 Revolution was a heroic struggle in which tens of millions of agricultural labourers, poor tenant farmers and workers directly participated. However, although this great revolution brought the toiling classes to power, because the revolutionary forces were heavily based on hard-to-unite tenant farmers (unlike the 1917 October Revolution that was based on united workers organised through elected workers-led councils) who, while suffering common exploitation by greedy landlords, nevertheless produced for themselves and competed in the markets to sell their produce, the new society had to be held together and administered from above. The ruling middle class bureaucracy, while they still had to administer the society in the interests of the victorious toilers, did so in an imperfect way and in a manner that ensured their own privileges. In the late 1970s, the bureaucratic PRC government, faced with the need to boost production and in the face of intense pressure from the surrounding capitalist world, turned to pro-market reforms. In the following years, a sizeable private sector has developed in China, far in excess of the partial concessions to a private sector that can sometimes be needed in the transition phase between capitalism and socialism. This has brought with it some of the vices of capitalist society such as inequality. Nevertheless, the socialistic public sector still thoroughly dominates the key means of production in China.

Moreover, the fact that the PRC is a socialistic state and the mostly smaller private businesses rely on state-owned giants for raw materials, transportation and energy means that even China’s private sector is sometimes constrained to partially serve broader social goals. If we compare China with capitalist countries, we find that the relationship between private bosses and the state are the very opposite of each other. In Australia, Indonesia, India, Italy or the U.S., the capitalist state and its officials suck up to the rich capitalists who are the real power. In contrast in Red China, the private business owners that do exist suck up to the workers state and are desperate to show their deference to the socialistic order. As a result, during this COVID-19 pandemic even some privately-owned businesses contributed to the relief effort. Indeed, even greedy capitalist billionaire, Jack Ma, with rumours swirling that he was forced to retire last year to try and head off being cracked down upon – as has deservedly happened to so many other high-flying capitalist exploiters in China before him – tried to win favour with authorities by making significant donations to the pandemic response.

However, the existence of a too large private sector remains a problem in China. Although the PRC was able to mobilise its state-dominated economy to very quickly and effectively build hospitals and produce urgently needed items for the pandemic response, the fact is China would have been able to respond even faster had the proportion of the economy under state ownership been even higher. And that would have saved still more lives. Moreover, the existence of a sizeable capitalist class with wealth and influence presents a mortal threat to China’s socialistic system. These capitalists are not happy that they are largely cut out of the most profitable sectors of the Chinese economy like the banks, the oil and gas companies and the other strategic sectors. They resent being pressured to sometimes sacrifice their profits for the social good. These frustrated capitalists are, thus, constantly seeking to expand their tenuous “right” to “freely” exploit labour unrestricted by any constraints. Moreover, many of these capitalists quietly harbour more ambitious aims. They are waiting for the moment, during some sort of social or economic crisis, when they can make a bid for power. They know that they will have the full backing of the capitalist powers around the world in this endeavour.

Indeed, the COVID-19 pandemic has seen the already intense hostility towards China of the U.S., Australian, British, Japanese, German and other imperialist rulers rise to still higher levels. These imperialist ruling classes have engaged in a hysterical campaign of lies to blame socialistic China for the pandemic spread. The capitalist rulers fear that their own working class masses will compare China’s effective and successful response to the virus threat with their own flawed and ineffective response and will thus draw the conclusion that the socialist system is superior and needs to be fought for in their own countries. This is, in fact, the greatest fear of the capitalist rulers. But for the very same reason that the capitalists hate the fact that the world’s most populous country is under socialistic rule – and is actually proving that socialism works – the working classes in the capitalist world should defend socialistic rule in China. For the existence of the PRC workers state – despite all its bureaucratic deformations, its concessions to capitalists and its resulting fragility – makes the struggle for working class rule in Australia and the rest of the capitalist world stronger. That is why the workers movement must oppose the Australian regime’s military build up against China and her socialistic North Korean ally, must stand against the U.S. and Australian Navy’s military’s provocations against China in the South China Sea, must oppose Australian support for anticommunist forces within China (from the far-right Falun Dafa outfit to the pro-colonial, rich kid rioters in Hong Kong) and must resist the Australian regime’s attempts to intimidate and silence pro-PRC voices within Australia – including those of pro-PRC Chinese international students. Right now we especially need to refute all the China-bashing lies being spread over the COVID-19 pandemic. We also need to explain to the masses that for all the incompleteness of China’s transition to socialism, the fact that public ownership plays the backbone role in her economy was what made the PRC so effectively able to respond to the virus threat. In doing so we will at the same time motivate the need to fight here for a system of public ownership based on working class rule, i.e. a socialist system.

However, working class people will not be won to seeing the need for socialist revolution simply through hearing explanations of its necessity. The masses learn mainly through participating in – and drawing lessons from the experience of – struggles for their immediate interests. That is why all those who understand the need for a socialist future must fight to build such campaigns. At the same time, we must work hard to ensure that these struggles for immediate gains are waged in such a manner as they teach the working class to distrust all the parties and factions of the capitalist class, convince the masses to trust only their own power, place no reliance on any institutions of the capitalist state and are based on slogans that advance the working class towards the conclusion that they will in the future need to take both the economy and state power into their own collective hands. Today that means building struggles to fight for the nationalisation of the banks and for the winning of jobs for all through forcing companies to hire (and in many cases re-hire) more workers at the expense of their profits.

The Program of Nationalization of the Banks vs the Green Party’s Agenda

If anyone thinks that urgently needed measures like the nationalisation of the banks can be won merely through the parliamentary process, one has only to look at the agenda of the current parliamentary parties to see why not. Of all the parliamentary parties the Australian Greens have been the most critical of the current banking system. So their program deserves to be given some scrutiny. The Greens call for more regulation of the banks. As a policy principle, they say that, “Publicly-owned financial institutions should form a key component of Australia’s banking sector”, without offering any program about how that would arise. But they fail, even now during this time of public health and economic emergency, to call for the nationalisation of the banks. At most their agenda amounts to a return to the system that we had before the Hawke-Keating reforms of the 1980s and 1990s – and in some ways not even that since the Greens do not call for the reimposition of state control over bank interest rates. Yet, while the banks were slightly more constrained in their operations before the Hawke-Keating reforms, they hardly operated even then in the service of the people. They were still largely driven by the imperative to maximise profits.

A major part of The Greens agenda for turning back the clock is to split up financial planning and superannuation operations from the banks. However, the banks themselves are doing this now in the wake of bad publicity. Indeed, in good part they have already completed this. Last year Westpac sold off its financial advice arm BT Financial and CBA sold off its financial planning arm, Count Financial. The Greens hope that making the banks smaller will reduce abuses by them. However, the new broken up or sold off, but still massive, corporations will still be run for profits. Moreover, the new wealth management corporations will likely be significantly owned by the very same very rich people – yes and through those “bank nominee” fronts – as the banks are. The bank owners quite happily pursued this break up option because by separating out its wealth management arms that had a particularly bad reputation, their banking operations can be shielded from the foul publicity arising from the openly fraudulent practices of the financial planning operations.

Much of the remainder of The Greens practical program for the finance sector like calling for “effective regulatory supervision to enforce prudential regulation” is very similar to what the limp Royal Commission recommended. Overall, The Greens platform will not fundamentally change the way the financial system operates. Banks will still be run largely on the profit motive and will still have freedom to decide who they lend to and at what rates. And many working class people couldn’t care less if the banks own wealth management operations or not because they have little money to put into these funds anyway! So even though The Greens say in the abstract that the “banking and finance industry should serve the broader public interest”, their actual program will not get anyway near this. The reason that The Greens’ agenda cannot come even close to advocating what is really needed to begin to make “banking and finance industry serve the broader public interest,” that is the nationalisation of the banks, is that such an agenda can only be won through working class struggle against the capitalist class. But The Greens cannot truly promote such an agenda as their party includes and appeals to all classes – including capitalists. Owning operations in areas like renewable energy, services, online business, hospitality, tourism and the arts, the full-blown capitalist exploiters that support The Greens feel that the Greens push to favour their sectors over fossil-fuel and energy guzzling sectors would dovetail with their own business interests. Sure, these capitalists accept a more far-sighted view of the threat of climate change than coal mining bosses do. But they are still capitalists who exploit workers! To even speak of nationalisation of any sector would scare these “enlightened capitalist” exploiters as it would make them fear that their own operations could face nationalisation next. Meanwhile, playing a very prominent role in The Greens are well-heeled, upper-middle class professionals. This latter chunk of Greens supporters are, to be sure, somewhat “progressive” minded. But, just like the actual capitalists in The Greens, this does not stop them from having considerable sums put into wealth management products – who in turn invest this money in shares (including bank shares) – or into their own direct shareholdings. So, they would not be too thrilled about any measures that could radically slash the profits of banks.

This same dilemma faces The Greens more broadly – an abstract wish for less inequality and a more “people-oriented society” but no program that would deliver this. Take, for instance, the signature policy of The Greens and its new leader Adam Bandt: “A Green New Deal.” They say that the aims of this “Green New Deal” are “tackling social and economic inequality,” reducing underemployment, increasing wages, having more secure jobs, giving young people more hope of buying a house and ensuring action to beat the climate crisis. OK, but The Greens say this would be achieved through “a government-led plan of investment and action.” However, any reduction of inequality requires struggle against the exploiting class by the working class masses. Government investment in social programs and “clean jobs” requires someone to pay for such measures which requires a struggle against the capitalists to make them pay. The Greens do not even mention this crucial element of class struggle without which talk of building “a caring society” is meaningless. They want to make capitalist society fairer without standing up to capitalist power. And how could they when actual capitalists play a significant role in their own party! Without challenging capitalist power, any government spending and policies will inevitably bend to the demands of this powerful class. That is why when The Greens have actually been in office they have administered society in a way barely different to the other pro-capitalist parties. As part of a coalition with the ALP, the Greens had two ministries in the Tasmanian governments from 2010 to 2014 that cut the jobs of hundreds of nurses, closed public hospital beds, reduced funding for ambulance services, slashed funding for public housing maintenance, cut public sector jobs and reduced public sector pay increases below inflation. In his portfolio as minister for Education and Corrections in these governments, then Tasmanian Greens leader, Nick McKim, oversaw a prison system with substandard conditions for prisoners and tried to close 20 public schools before angry mass opposition forced him to back down. Meanwhile, the Australian Greens counterpart in Austria proved the commitment of this brand of politics to the anti-working class status quo by earlier this year joining in a government coalition with the right-wing, anti-union and anti-immigrant Austrian People’s Party.

Therefore, while we support action to fight for certain particular policies that Bandt has also advocated – like dental into Medicare and free education – we oppose overall The Greens and Bandt’s program of refusing any challenge to the power of the capitalists, while greening capitalism, under a “Green New Deal.” Remember how The Greens’ platform, including the Green New Deal, does not even call for the nationalisation of the banks. Unfortunately, however, much of the far-left in Australia have been cheering The Greens program. The Socialist Alliance have been the most enthusiastic. The Solidarity group are not far behind, only adding that “Adam Bandt’s Green New Deal won’t be won through electoral dead end.” The Communist Party of Australia (CPA) meanwhile ran an editorial in the February 17 issue of their paper, The Guardian, that pushed for overall (albeit qualified) support for Bandt’s Green New Deal, even while very correctly acknowledging that The Greens are a bourgeois party. This despite several contributors to their newspaper insightfully and convincingly attacking the Green New Deal agenda last year. Thus, in the 19 September 2019 issue of the CPA’s newspaper, an article titled “Socialism or perish” rightly argued that “we should be openly and loudly challenging the ideas put forward by many young climate activists and NGO groups who argue for a `Green New Deal’ or other policies that amount to the greening of capitalism.” In effect, in response to such points, the February 17 CPA editorial raises the argument that supporting the Green New Deal would be a united front with The Greens. Here they confuse agreements between communists and one or more reformist tendencies within the workers movement – which may include Laborite union leaders, “democratic socialist” groups and mass social democratic parties based on our unions (of which the ALP is a very right-wing version) – to launch particular united-front actions, or a series of actions, when common demands arise (like supporting a strike for higher wages or a protest march against right-wing welfare cuts) with ongoing support, however qualified, for the program of a bourgeois party. In the former case, building workers’ united front actions, when it is advantageous for the overall struggle to do so, will result in increased class struggle of the working class against the capitalists and an opportunity for communists to explain to the masses the need for more deep-going attacks on the power of the capitalists. However, in the latter case, a “people’s front” alliance between leftist workers parties and a bourgeois party (that is, a party like The Greens that does not even see itself as a party for workers’ particular class interests and which includes – and is thus subordinate to – members of the dominant capitalist class), the effect is to retard class struggle by promoting the notion of salvation through a supposed “progressive” wing of the exploiting class. Now it must be said that those nominally Marxist groups that promote The Greens party’s signature platform do in their own right call for class struggle against the capitalists and for policies that do begin to challenge capitalist influence, like calling for the nationalisation of the banks. However, promoting the platform of a bourgeois party like The Greens and seeking an ongoing alliance with such a party undercuts the class struggle aspects of these left groups’ own agenda, because it ties the workers that they influence to a section of the capitalists and, thus, also promotes the illusion that the masses can win concessions without struggle against the exploiting class.

The Struggles of Today that Can Blaze the Path to a Socialist Future

There is another reason why genuine socialists should not be promoting The Greens party, in however a qualified form. For The Greens are just as much as the Liberal-Nationals, the ALP and the far-right One Nation Party part of the Cold War drive against the world’s biggest socialistic country. Indeed, Greens NSW upper house MP, David Shoebridge, has been just as fanatical in inciting hostility to the PRC workers state as the likes of hard-right Coalition politicians like Peter Dutton, Andrew Hastie, Tim Wilson and Eric Abetz. Although Shoebridge seems to be today rejecting the far-right conspiracy theories about the World Health Organisation and China, he has spent the last several years energetically promoting other far-right conspiracy theories against China, including the ridiculous claims that China is executing members of the extreme right-wing (and rabid Trump-supporting) Falun Dafa group to harvest their organs.

Left: Filthy rich developer and tech capitalist, Graeme Wood, has donated millions to the Greens including Australia’s largest single, individual political donation. The Greens embrace of such capitalist exploiters among their ranks and donors ensures that despite objecting to the inequality of the current society and despite being critical of Australia’s financial sector, the Greens recoil from any sort of class struggle opposition to the capitalist exploiting class or any call for the nationalisation of the banks. Instead, the Greens only offer a toothless strategy of liberal middle class pressure and parliamentary manoeuvres to try and ameliorate the worst excesses of capitalism. At the same time, on fundamental issues, the Greens often line up with the rest of the capitalist class – including vehemently supporting the Australian rulers’ Cold War drive against socialistic China. Centre: NSW Greens upper house MP, David Shoebridge, hosting a rally supporting the extreme right-wing, pro-Donald Trump, Chinese opposition outfit, Falun Dafa in its propaganda campaign against Red China. Shoebridge has been among the most fervent supporters of this anti-communist campaign. Right: Notorious far-right Liberal Party federal MP, Craig Kelly, speaks at a similar Falun Dafa event.

The harm done by The Greens’ support for the anti-communist drive against the PRC does not only consist of the anti-Asian racist violence that it is fuelling and the blows against the Chinese workers state that it is landing. For by attacking the world’s largest socialistic state, The Greens, no matter what else they may say, are assisting the Australian ruling class to trick the masses into believing that there is no real alternative to capitalist “democracy” and that a socialistic state dominated by public ownership would be a nightmare. In other words, The Greens’ opposition to Red China makes them an enemy of the fight for socialism in this country.

That The Greens, a party that many young leftists have hopes in, and the Labour Party, the party that retains the support of most workers, have agendas that support the ruling class drive against the world’s biggest socialistic country, that fail to call for putting the banks under state control and which accept the “right” of capitalists to sack workers whenever it is most profitable to do so proves that we need to build a new workers’ party that will truly serve the interests of the exploited and oppressed. Such a party would refuse to restrict its program to what can be tolerated by the capitalists but would, instead, lay out an agenda based on what the working class and all the downtrodden actually need. Instead of feeding into the nauseating talk, that we are hearing so much of lately, that we are “all in the same boat”, the workers party that we need would be based on a clear understanding that the interests of the working class are counterposed to those of their capitalist exploiters. Thus rejecting “national unity” with the capitalists, such a party would instead fight for the closest possible alliance between the working class in Australia and the working classes of the world. In summary, the workers party that we need must be an authentic communist party like the Bolshevik party that led the Russian Revolution. We in Trotskyist Platform work hard to contribute to the building of such a party. We understand that such a party will be built in the course of laying out a perspective based on militant class struggle in the course of joining in actions that fight for the urgent needs of the masses. Today, at this time of public health emergency, massive unemployment and growing immiseration of the masses that means agitating and mobilising to demand: Put the banks and insurance companies under state control! For the complete and permanent nationalisation of the health system! For jobs for all workers through preventing companies that have been making a profit over the years from cutting their workforce and by forcing still profitable companies to increase hiring at the expense of their profits! Permanency for all casual workers! Grant the rights of citizenship to all migrants, refugees and international students! For a six-month halt to all rent payments for residential tenants! Requisition the unoccupied dwellings of people owning more than three homes and convert this immediately into public housing!

24 July 2020: Woolworths workers on a picket line as part of a 24-hour strike. Five hundred workers at Woolworths’ warehouse in Wyong, NSW took the action to demand decent pay and conversion of long-term casuals to permanency. We need militant class struggle to win permanency for casuals, to force profitable companies to increase hiring at the expense of their profits, to win the nationalisation of the banks and to fight for a massive increase in public housing.
Photo Credit: United Workers Union
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    The Realities of Changing Power in Asia Require a Fundamental Rethink in Australian Policies

    And important article has been written by Hugh White the emeritus professor of strategic studies at the Australian National University and a former deputy secretary of the Department of Defence. It deserves to be widely read and the points he makes absorbed by all who are concerned about the current direction of Australia’s defence strategy.

    White commences his article by pointing out the alarming drop in Australian exports to China, a country that is by far its major trading market, taking 40% of Australia’s exports.  That is a figure twice the proportion of Australia’s next largest market, Japan.

    Australia is responding to the difficulties with China by going out of its way to seek new ways of offending the country. It has deteriorated to the point where senior government ministers are talking with what he calls disconcerting nonchalance to the growing risk of war. He points out that the government shows no signs of appreciating how serious and dangerous the current situation is. Equally disturbing is that the government seems to have no plan to fix the problem. This must count, he says, as one of the biggest failures in Australian history.

    On a more contentious level, White points out that Australia’s interests have been well served by the United States led order. He argues that this order has kept our region stable and peaceful for so long. That is dubious to say the least. In the post-World War II era the United States promoted the Korean war, invading the North of Korea and continuing right to the Chinese border. We now know that the Americans sought the approval of President Truman to use nuclear weapons as part of the invasion of China, then under a newly installed Communist government.

    The American belligerence brought China into that war, with the Americans and their allies, including Australia, being rapidly driven back south of the North-South Korean border. Millions of North Koreans died in the aerial assault by the Americans on their country over the next two years.

    It would also be difficult to argue that the United States war on Vietnam, again with the willing assistance of Australia, that raged from 1954 with the defeat of the French at Dien Bien Phu to their final humiliating retreat in 1975.

    White says that the Australian government has a plan, it wants to make the Chinese problem go away by forcing the Chinese to go away and abandon its own ambitions in favour of United States concept of the rules-based order, a peculiarly framed concept that the Americans have long promoted. This writer argues that it is an attempt to replace the more widely accepted concept of the rule of international law which has served the international community well in the post-World War II era.

    Australia has been quick to join the Americans, and more recently the British, in placing China at the top of its opponents list. White points out how easily this plan to contain China could go awry.

    Australian policy is based in large part on a belief that its concerns are shared by other nations in the region. That seriously underestimates the extent to which other countries in the region value their economic ties to China. China is by objective measurement the world’s largest economy and by the estimate of Australia’s own 2017 foreign policy White Paper will be close to double the size of the United States economy by 2030.

    This simple stark brutal fact overshadows everything else, White says, because wealth is power in the international system. One of the simple effects of China’s great power is that it could easily impose great costs on those who oppose it. That is the fundamental principle that the Australian government fails to acknowledge.

    It is the brutal reality that Australia’s other friends in the region, including Singapore, South Korea and even Japan, recognise. He quotes Singapore prime minister Lee who in a recent major speech very plainly repudiated the idea of trying to control China. Instead, Lee argued, we should be accommodating China’s ambitions by creating a new regional order that reflects the new realities of regional power.

    Those realities mean that the Morrison government ambition to push China “back into the box” are doomed to fail. This is a reality that is even recognised by the Americans under President Biden. Biden will choose the option of rebuilding America to that of trying to contain China.

    It is a brutal reality that has not been recognised by the “lacklustre administration” in power in Australia. White argues that the current Australian leadership seems to have no idea of the risks to Australia that their current policy represents. The government is currently hiding behind the benefits of the high iron ore price. The future looks a lot grimmer for Australian exports, with other markets only partially replacing the lost Chinese market.

    As important as the economic losses are, however, they are trivial in comparison with the strategic risks and costs that Australia faces as a consequence of its incredible stupidity in advocating a policy of containment toward China.

    White points out that the current Australian policy toward China runs the very real risk of degenerating into a shooting war. This blunt effect was recently acknowledged, among others, by defence Minister Peter Dutton. The governing assumption appears to be that the United States will go to war with China, and that Australia will follow along, as it has done so in the past, Including in at least three current foreign wars of little or no real relevance to Australia.

    The consequences of Australia fighting a war with China would be devastating. Not the least of its consequences would be the loss of America’s position in Asia. Australia is blindly following the United States into the possibility of a war with China and no one in the government appears to have given a thought as to the consequences of what is almost certainly an American loss.

    Australia needs to spend some serious time thinking about a new approach to China, indeed to the implications of the inevitable rise of our great Asian neighbouring powers, including India and Indonesia. All of this has implications for Australia’s relationship to its traditional modes of thinking, none of which is of real relevance in the realities of the 21st century.

    White points out that such rethinking would require hard work, deep thought and subtle execution. It would mean, he says, a revolution in our foreign policy. The changes in our region require nothing less. The real question is whether our political leadership even begins to grasp the implications of these changes and do they have the wit to formulate and execute the policy changes that are so manifestly required. Thus far the signs are not encouraging.

    The post The Realities of Changing Power in Asia Require a Fundamental Rethink in Australian Policies first appeared on Dissident Voice.

    Forgetting Citizenship: Australia Suspends Flights from India

    As India is being devastated by COVID-19 cases that have now passed a daily rate of 400,000, affluent and callous Australia has taken the decision to suspend all flights coming into the country till mid-month.  The decision was reached by the Morrison government with the blessing of the State Premiers and the Labor opposition.

    Not happy with banning flights from India, the Morrison government promises to be savage in punishing returnees who find ways to circumvent the ban (for instance, by travelling via a third country).  Citizens who breach the travel ban can face up to five years’ imprisonment and fines up to AU$66,000.  “We have taken drastic action to keep Australians safe,” explained the Treasurer Josh Frydenberg.  The situation in India was “serious”; the decision had only been reached after considering the medical advice.

    According to a statement from Health Minister Greg Hunt, it was “critical the integrity of the Australian public health and quarantine systems is protected and the number of COVID-19 cases in quarantine is reduced to a manageable level.”

    The decision fails to carry any weight.  It did not take long for more alert medical practitioners to wonder why the approach to India was being so selectively severe.  Health commentator and GP Vyom Sharma thought the decision “incredibly disproportionate to the threat that it posed”.  Sharma is certainly correct on this score in terms of international law, which requires the least restrictive or least intrusive way of protecting citizens.

    Then there was the issue about the previous policies Canberra had adopted to countries suffering from galloping COVID-19 figures.  A baffled Sharma wondered, “Why is it that India has copped this ban and no people who have come from America?” Former race discrimination commissioner Tim Soutphommasane seconds the suspicions.  “We didn’t see differential treatment being extended to countries such as the United States, the UK, and any other European country even though the rates of infection were very high and the danger of its arrivals from those countries was very high.”

    The Australian Human Rights Commission has also asked the federal government to justify its actions. “The government must show that these measures are not discriminatory and the only suitable way of dealing with the threat to public health.”

    In the face of such behaviour, aggrieved citizens are left with few legal measures.  Australia, among liberal democratic states, is idiosyncratic in refusing to adopt a charter of rights. Down Under, parliamentarians are supposedly wise and keen to uphold human rights till they think otherwise.  (Human rights, the argument goes, would become the fodder of lawyers and judges, interfering with the absolute will of Parliament and the electors.)  The Australian Constitution is hopelessly silent on the issue of citizenship.  Left at the mercy of legislative regulation, Parliament and the executive can be disdainful towards their citizens without consequences.

    One avenue remains the Geneva-based UN Human Rights Committee.  On April 15, the UNHRC ruled on the case of two petitioners of FreeAndOpenAustralia.org (formerly StrandedAussies.org) that the Morrison government had to “facilitate and ensure their prompt return to Australia.”

    Represented by the notable sage of international law Geoffrey Robertson QC, the petitioners argued that Australia was in breach of Articles 12(4) and 2(3) of the International Covenant on Civil and Political Rights.  The first article provides that no one shall be arbitrarily deprived of the right to enter his own country; the second provides for “effective” remedies to be granted to those whose rights and freedoms have been breached under the ICCPR.  The petitioners also freely admitted that they had no issue with quarantining for 14 days on returning to Australia.

    In the words of Free and Open Australia spokesperson Deb Tellis, the Commonwealth should “use its power to expand quarantine facilities, and end travel caps that are being dictated by the states.  There are thousands of our fellow citizens suffering loss of their relatives and loss of their jobs.”

    The government has preferred a meaner, penny pinching approach in coping with quarantine, reducing flights when needed rather than expanding facilities to accommodate a greater number of infected arrivals.  The hotel quarantine system continues to receive effusive praise from the Australian Prime Minister Scott Morrison as being 99.99 percent effective.  But it is impossible for him, and his ministers, to conceal the fact that they do not trust, and are unwilling, to use other facilities and expand existing ones.

    Since last November, there have been 16 COVID-19 leaks across the cities of Melbourne, Sydney, Brisbane, Adelaide and Perth from quarantine hotels.  At this writing, another quarantine leak is being reported in Western Australia, involving the now customarily infected hotel security guard and the inevitable seepage into the community.  The problem of airborne transmission continues to plague, as does the uneven provision of Personal Protective Equipment.  No national standard of quarantine has been formulated through the country, with each state adopting its own approach.  Audits of the ventilation systems in many such hotels remain sketchy.

    Western Australian Premier Mark McGowan, who recently imposed a lockdown of the Perth and Peel areas and may well do the same thing over the next few days, suggested that the Commonwealth be generous with some of its facilities.  Why not use the RAAF Curtin Air Base, or the immigration detention centres of Yongah Hill and Christmas Island?  “It’s kind of staring us in the face and there are things that could assist, it’s just that the Commonwealth doesn’t want to do it.”

    The evidence so far is that facilities such as Howard Springs in the Northern Territory tend to work.  It features single-storey cabins, segregated air conditioning systems, outdoor veranda space and, in the vicinity, a fully functioning hospital.  No leaks have been recorded.  And location is everything: distant from densely populated areas.  This government, however, is miserly on the issue of quarantine, an obligation it has transferred without constitutional justification to State premiers who fear both the virus and its electoral consequences.

    The post Forgetting Citizenship: Australia Suspends Flights from India first appeared on Dissident Voice.

    Mike Pezzullo and Giving War a Chance

    Those madly titillated by conflict have become bolder of late in the corridors of the isolated Australian capital.  In such spaces, insanity can be nurtured with a sickening attention to detail, much of it fictitious.  One of the most powerful bureaucrats of the Australian Public Service has made a contribution to a war dance he regards as virtually unavoidable.  Mike Pezzullo, Home Affairs Secretary, is keen to shed some blood in combating the China Menace if needed.

    The outcome of this wish is always vicarious: others die so that bureaucrats may shuffle papers, consult minutes and scoff the scotch.  This is then justified on the basis that sacrifices are necessary to defend that indefinable property called freedom.

    The Secretary’s ANZAC Day message to his staff was stocked with the usual rhetorical trinkets of the barely closeted warmonger.  “Today, as free nations again hear the beating drums and watch worryingly the militarisation of issues that we had, until recent years, thought unlikely to be catalysts for war, let us continue to search unceasingly for the chance for peace while bracing again, yet again, for the curse of war”.

    War is never caused by these “free nations”; it is provoked by those nasty unfree ones who go around stirring trouble.  Resorting to war “might well be folly, but the greater folly is to wish away the curse by refusing to give it thought and attention, as if in so doing, war might leave us be, forgetting us perhaps.”

    In wishing to summon the dogs of war, Pezzullo drew upon a person who was, for all his faults, a formidable general who knew a thing or two about combat.  US Army General Douglas MacArthur, in his address to the West Point Military academy in 1962, explained to cadets that “their mission was to train to fight and, when called upon, to win their nation’s wars – all is entrusted to others”.  One imagines Pezzullo, flushed with pride in using lines best reserved for a military veteran rather than a fantasising civilian.

    The bureaucrat’s poor use of history was much in evidence.  Having pinched from MacArthur, he duly did the same to US President Dwight D. Eisenhower who, in 1953, “rallied his fellow Americans to the danger posed by the amassing of Soviet military power, and the new risks of military aggression”.  (He forgets that the same president also warned of the paranoia and dangers associated with the Military-Industrial complex.)  Eisenhower was a good egg, having taken to instilling in “free nations the conviction that as long as there persists tyranny’s threat to freedom they must remain armed, strong and ready for war, even as they lament the course of war.”  The blood-readied formula for Pezzullo: “In a world of perpetual tension and dread, the drums of war beat – sometimes faintly and distantly, and at other times more loudly and ever closer.”

    When MacArthur found himself relieved by US President Harry S. Truman, a statement of priorities was made.  The General had been keen to expand the Korean conflict with the use of atomic weaponry, there being no credible substitute for victory.  In fairness to him, Truman had also given him ideas, wishing to threaten the potential use of atomic-capable B-29s should the need arise.  MacArthur saw that need, claiming that 30 to 50 tactical atomic bombs would have done the trick; Truman did not, preferring the bluff.  Australian Prime Minister Scott Morrison might do well to consider a similar option regarding Pezzullo, who is making his far from negligible contribution to incitement.

    In the context of Australian history, few military engagements have been necessary for existentially sound reasons.  There have been no marauding armies of Huns, Mongols or Tartars to threaten the country, laying waste to villages and towns, and initiating hearty pogroms.  (The same cannot be said for the Indigenous populace, doomed the moment European settlement became a sanguinary reality of massacre, disease and dispossession.)

    A pity it is that a more mature constellation of thinkers have not impressed themselves in the field of Australian strategic thinking.  Instead, Australian soldiers have been fighting and dying in a range of operations in profound ignorance of their geography and history.  These recruits supply the needless cannon fodder for empires not their own, placating the officialdom of foreign capitals.

    The Australia-China policy, and the insistence on placing Australia on the warpath, is a suicidal wish linked to Washington and based on an alliance that is dangerously unconditional and misplaced.  Unfortunately for Australia’s military and defence establishment, all such alliances, however friendly, remain putatively conditional.  Matters of strategy, resources, and realities, will intrude.

    The fall of Singapore to the forces of Imperial Japan in February 1942 was one such jarring reality.  The guarantees of security made by Britain to Australia, assumed since the late eighteenth century, were shredded by a stunningly bold campaign waged by soldiers who had been woefully underestimated.  British naval power was blunted as Japanese prowess grew.  The reassurances of the Empire were dashed by surrender.  “This was a quintessential failure of an alliance,” wrote academic strategist Hugh White in 2017, “and of a strategic policy based on alliances.”

    White, far more sensible than Pezzullo on this score, speaks of the Singapore disaster as a telling lesson for Australian strategists.  It was a failure that revealed “an inability to recognise and accept fundamental shifts in the distribution of wealth and power which were transforming both the globe and the regional strategic orders, and undercutting Britain’s place in them.”

    The parallels with the US are all too clear.  From 1996 to the mid-2000s, bipartisan politics seemed to accept that Australian security could well be left in the broad, clasping hands of Washington.  But be wary of the shifting patterns of power, warns White, for “America is weaker economically, diplomatically and military than it has been since World War Two, and yet we rely on it more.”

    Another factor also lubricates such slavish refusals to accept the changed order of things.  Ignorance is the less than golden raw material that precedes misconceptions.  In time, these misconceptions become policy platforms.  The Australian Public Service (APS) is sorely lacking in much expertise that might sharpen a coherent focus towards the Indo-Pacific.  In 2019, an “independent review” of the APS characteristically tooted that, “The ongoing shift in global economic weight to Asia presents tremendous opportunities for Australia, along with risks and significant challenges.”

    Tritely, the review, titled Public Service Our Future, notes that the APS needed to “deepen its experience in, and knowledge of, Asia.”  Those behind making policy required “a more sophisticated understanding of the region, as well as Asian language proficiency.”

    For almost a decade now, there has been much chatter about needing to beef up the stock of knowledge of that most complex of continents.  The 2012 Asian Century White Paper was almost banal in stating that Australia was essentially flying blind in the region; there was a pressing need to “broaden and deepen our understanding of Asian cultures and language, to become more Asia literate.”  But the APS review found something quite different: “Coordinated and sustained action to deepen Asia-relevant capabilities was not taken then, and it remains a skills gap across the APS.”  Pezzullo’s barking remarks suggest that illiteracy regarding Asia has become intellectually fashionable and monumentally dangerous.

    The post Mike Pezzullo and Giving War a Chance first appeared on Dissident Voice.