POLICY CONTENTS ideas • debate • opinion Volume 31 No. 2 • Winter 2015
SYMPOSIUM ON FEMINISM ARTICLES 3 The Corruption of Feminism 39 Free Trade & Its Exceptions When human rights stopped being about Do they apply to Australia today? freedom, so did feminism. Sinclair Davidson Janet Albrechtsen 45 How Ideas Spread 7 Global Women’s Issues One CIS report’s 20-year journey Why we still need feminism. around the globe. Andrea den Boer Wolfgang Kasper
12 New Feminism’s War on Women 49 Laudato Si’: Well Intentioned, The arguments once made by misogynists Economically Flawed are now made by feminists. Pope Francis has too negative a view Brendan O’Neill of markets, but he is no Marxist. Samuel Gregg
FEATURES RESEARCH 15 Australia’s Future in the Balance 52 Charter Schools, Free Schools, Overcoming antagonism and reigniting and School Autonomy enterprise and prosperity. The prospects for innovative education Wolfgang Kasper & Paul Kelly models in Australia. 24 Magna Carta: The Rule of Law Jennifer Buckingham & Trisha Jha and Liberty The principles inherent in the document developed by incremental steps. BOOK REVIEWS James Spigelman 59 Christian Reconstruction: 32 Magna Carta: 800 Years of Law R. J. Rushdoony and American Religious Conservatism & Liberty By Michael Joseph McVicar From Scalia to Jay-Z. Reviewed by Jeremy Shearmur The Hon. Christian Porter POLICY staff Editor-in-Chief & Publisher: Greg Lindsay Editor: Helen Andrews Assistant Editor: Karla Pincott Design & Production: Ryan Acosta Subscriptions: Kerri Evans and Alicia Kinsey
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THE CORRUPTION OF FEMINISM When human rights stopped being about freedom, so did feminism.
am so happy to be here at Big Ideas. If we Today the air is toxic. Today’s modern feminism were in a university lecture hall, I would have is a corruption of what feminism should be. to issue a trigger warning that the following It’s become a trivial movement that infantilizes content may offend old-style feminists and women. And it has taken one heck of a moral Imodern day grievance warriors. If I was speaking detour away from real issues of freedom. at a conference of university students, I would ask But if feminism is not about freedom, what’s that there be no clapping, in case it triggers anxiety. the point of it? If it’s not about freedom, it’s just I would ask for ‘jazz hands.’ a lobby group for pet grievances. So what the hell happened to feminism? It’s too Today’s feminists feast at a smorgasbord of early for karaoke, but feminism should be summed whinges, whines, victimhood claims, misogyny up by Helen Reddy’s iconic song: games, gender binary discussions, Western world obsessions about pay gaps and quotas and glass I am woman, ceilings. Hear me roar… Brave riders of the feminism’s third-wave include I am strong, pop stars like Taylor Swift who recently said: ‘I didn’t I am invincible. see myself as held back until I was a woman.’ As Heather Wilheim wrote recently for The Federalist: Sadly, the lyrics of modern feminism go ‘Held back from what?’ Building a net worth of something like this: $250 million? It’s probably too much to expect celebrities to I am woman, become feminist icons. But when women like Hear me whine, Gwyneth Paltrow teach us about the wonders of I am weak, vaginal steaming, you have to ask— I am vulnerable. is that really the best they can do? What about the media—how The notion of triage—of prioritizing problems, are they doing? How long have of addressing those who most need help—has been we got? inverted by modern feminism. Let’s start with the keyboard If today’s feminists ran a hospital emergency feminists who found so much department, they would be racing to fix an otherwise healthy middle-aged woman with a common cold over a young girl facing a life-threatening injury. Don’t get me wrong. As Anne Manne wrote so Janet Albrechtsen is a columnist for The Australian. eloquently many years ago, women like me inhaled These remarks were delivered at the Big Ideas Forum the benefits of feminism as naturally as the air hosted by the CIS in Sydney, 24 August 2015. we breathe.
POLICY • Vol. 31 No. 2 • Winter 2015 3 THE CORRUPTION OF FEMINISM
offence with Mark Latham’s crude tweeting about had finished reading the fictional Fifty Shades a handful of women. Latham gave up his column of Grey. in the AFR last week. I’m not defending Latham. This poor commentator would probably have His gratuitous nastiness always detracts from what to take a vaginal steam bath if she listened to the can sometimes be a kernel of confronting truth. words of Esther Perel who, in a recent TED talk, But it’s uncanny how the sisterhood strikes when pointed out that ‘most of us get turned on at night it suits—for political purposes, not as a matter of by the very same things we might demonstrate principle. against during the day. The erotic mind is not very It’s apparently fine for Clementine Ford to call politically correct.’ Miranda Devine a ‘f—ing c—’ on Twitter but it’s I’ll leave that subject to Cosmo magazine—save not fine for Latham to use crude words. I say a pox to say that feminists today don’t even understand on them both. freedom in the bedroom. Some years ago, Malcolm Turnbull rang me And how are our politicians faring on the at home and asked whether I knew what Latham feminism front? ‘The horror!’ exclaimed Greens had said about me. I hadn’t caught up with the senator Larissa Waters last year. Was she responding news: Latham had called me a skanky ho in federal to Islamic State’s propaganda which says ‘It is Parliament. I didn’t know what ‘skanky ho’ meant, permissible to buy, sell, or give as a gift female so, while I was on the phone to Malcolm, I googled captives and slaves, for they are merely property the phrase. Needless to say, I was inundated with which can be disposed of’ and ‘It is permissible to more porn than is decent when you’re sitting have intercourse with the female slave who hasn’t in your study with young children running reached puberty if she is fit for intercourse’? around you. No. The Greens senator was emoting over the fact that a Liberal MP, Michaelia Cash, doesn’t wear the feminist label. Like the Plastics in Mean Girls, the Plastic Feminism has been corrupted by its skewed Feminists have their own set of rules. set of priorities. When her leadership was in trouble, Australia’s first female prime minister, Julia Gillard, made asinine claims of misogyny and I don’t recall a single lefty feminist ticking off sexism against opposition leader Tony Abbott. Latham for calling me a smelly whore. And, of To coin a phrase from Helen Garner’s course, the stunt came about because he was dared magnificently nuanced look at sex and power, to put those words about me into Hansard—dared Gillard had a grid labeled ‘misogyny’ and she was by a lefty feminist. determined to apply it to the broadest possible There is an in-crowd of feminists. Like the field of male behaviour. When Abbott glanced Plastics in Mean Girls, the Plastic Feminists have at his watch in parliament, Gillard labeled that their own set of rules. It’s not about wearing pink sexism, too. Yet that speech about confected on Wednesdays, tracky pants on Fridays, and a misogyny became a defining moment for so many ponytail only once a week. The Feminist Plastics modern day feminists. have rigorous membership rules about believing in On the same afternoon that Gillard gave that abortion, quotas, glass ceilings, and assumed sexism. speech, a young Pakistani girl, Malala Yousafzai, The feminist collective is overflowing with boarded her school bus in the northwest Pakistani unprincipled trivia too. A couple of years ago an district of Swat, an area where the local Taliban English feminist in a London newspaper wrote that has regularly banned girls attending school. after reading something ‘I washed my hands with A gunman boarded the bus, too. He asked anti-bacterial soap, but couldn’t cleanse my mind of for her by name, pointed a gun at her and fired rising rage and desolation.’ three shots. One bullet hit the left side of Malala’s Was she reading about female genital mutilation? head, travelled through the length of her face, and Maybe child marriages? No. The enraged feminist lodged in her shoulder.
4 POLICY • Vol. 31 No. 2 • Winter 2015 JANET ALBRECHTSEN
Imagine, just imagine, if Julia Gillard had Attorney-General George Brandis has pointed out, made a heartfelt speech about Malala rather than the shift began with the elevation of the right to herself on that afternoon in October 2012. ‘equal concern and respect’—a notion developed by Don’t get me wrong. We can walk and chew legal philosopher Ronald Dworkin. gum. But we are so gummed up with Western ‘Equal concern and respect.’ What on earth does grievances such as sexism and pay gaps that we fail that mean? to try walking in the shoes of girls who need to Yet here was the beginning of a recalibrated escape from child marriages or women who have human rights movement in favour of victimhood been the victim of so-called honour killings. as defined by the paternalistic Left. Feelings have Feminism has become corrupted by its cultural become the measurement of human rights. infirmity, too—by a deep-seated Western self- This new victimhood movement has ditched loathing. While hostages were still being held Enlightenment ideas around the very notion of at gunpoint by a terrorist in the Lindt café last what it means to be a human being. No longer December, many high profile Australian women are people seen as autonomous and resilient and rushed to join a feel-good hashtag campaign rational beings. Under this new framework, people —#WISH, ‘women in solidarity with hijabs.’ are seen as weak, as vulnerable, as quivering mass Putting aside the fact that these women of nerves in need of protection—so weak we need immediately assumed Australians would default to trigger warnings, and jazz hands and laws that Islamophobia, why didn’t they show more concern prohibit words that are offensive or insulting. for the hostages inside the café—or even have a more nuanced debate about the fact that millions Once the notion of human rights became of women are forced to wear a veil as a medieval untethered from classical notions of freedom, form of oppression? feminism was destined to do the same. Hashtag campaigns? Pay gaps? Quotas? A man looking at his watch in parliament while a woman speaks? Trigger warnings? Jazz hands? Feminist The marketplace of ideas, where we critique, labels? They don’t make my list of Top Ten issues analyse, and sharpen ideas, is being usurped by a around the lack of freedom facing women today. crude market place of outrage where human rights Feminism’s focus on trifling, petty grievances legislation and anti-discrimination bureaucracies debases our public conversations. More importantly, buttress the new victimhood movement. it undermines the intellectual scaffolding around Two viruses, victimhood politics and a persistent freedom. strain of anti-Westernism, have corroded our The corruption of feminism is not a women’s most basic freedoms. These viruses have weakened issue. It’s best understood as symptomatic of a wider our ability to defend our most basic values. and deeper malaise. It emerges from a decades long Fundamental human rights, such as the right to corruption of human rights. freedom of expression, are being offered to certain Once the notion of human rights became minority groups at discounted prices. Hence free untethered from classical notions of freedom, speech becomes fair speech. feminism was destined to do the same. It is no Our cultural appeasement carries costs. It coincidence, for example, that the corruption emasculates our values. It means that in Australia, of feminism occurred at the same time as our a conservative government that claims to have free commitment to free speech has faltered. The very speech in its DNA refused to reform the Racial notion of free speech doesn’t seem to cut it anymore. Discrimination Act. It’s about fair speech instead, about not offending Cultural appeasement has horrendous physical or insulting people. costs too. In means almost 4,000 cases of female Forty years ago, the Left abandoned libertarian genital mutilation reported in Britain last year and notions of human rights and embraced a new 11,000 cases of so-called honour-based violence definition that elevates egalitarian rights. As over the past five years.
POLICY • Vol. 31 No. 2 • Winter 2015 5 THE CORRUPTION OF FEMINISM
There should be no reduction, no discount, no female genital mutilation or child brides or so- half-price sale of our fundamental human rights. called honor killings, which logically may require And that means no silence around the importance you to make judgments about cultures that of these values. oppress women. A few months ago, Swedish foreign minister Feminism’s warriors, both male and female, have Margot Wallstrom delivered a scathing assessment become the natural allies or useful idiots of those of the treatment of women in Saudi Arabia. opposed to Western freedoms. Remember, women can’t drive, can’t marry, Why is Ayaan Hirsi Ali derided as a ‘rock can’t have certain medical procedures without star who has done well for herself’? Why isn’t permission from men. Child marriages are common. she celebrated as a woman who has felt firsthand So is public segregation of the sexes. the constraints of culture and religion, a woman What happened? The Oppression Opera dedicated to Enlightenment values of freedom, returned to town—that familiar chorus of bleating reason, and inquiry? about Islamophobia that we have heard at regular The real feminists, those fighting for women’s intervals ever since Salman Rushdie wrote a book freedom, don’t sit at the centre of feminism called Satanic Verses. The Arab world condemned today. So how the hell can we get feminism back the Swedish foreign minister for Islamophobia. on the freedom track? The future of feminism is Saudi Arabia withdrew its ambassador to Sweden. inextricably linked with the future of human rights. At least there wasn’t a fatwa this time. When the latter rediscovers classical notions of What happened outside the Arab world was liberty, so will feminism. even more disappointing, and yet predictable. As Abraham Lincoln said so eloquently and so Wallstrom’s defence of women’s freedom was succinctly in 1863, liberty is an ‘unfinished work’ greeted with silence in the West. As Nick Cohen and it is up to us, again quoting Lincoln to ‘take wrote in The Spectator: ‘Outside Sweden, the increased devotion to that cause.’ Western media barely covered the story. . . . The By doing that, feminism will one day return to scandal is that there isn’t a scandal.’ the unfinished work of freedom – and when it does, The scandal is the strategic silence of modern more women, and men, will applaud it. feminism around freedom for women. It is And not with any weird shaking of jazz hands. much easier to attack the gender pay gap than
6 POLICY • Vol. 31 No. 2 • Winter 2015 SYMPOSIUM ON FEMINISM
GLOBAL WOMEN’S ISSUES Why we still need feminism
quality for women has been a long hard Many women lack the basic freedom of struggle throughout the world. Our movement; they are prisoners in their homes achievements have often been piecemeal, unless given permission to leave by men and are as exemplified by the history of the right viewed as male property. Afghanistan’s prisons Eto vote. New Zealand was the first in 1893, and are overflowing with women who have been Australia soon followed, with South Australia in imprisoned because they dared to attempt to flee 1894 and others shortly thereafter, but for other abusive husbands. They claim that they are better states the history of women’s voting is much off in prison because once released, they could be more recent: Switzerland in 1971, 1994 for black killed. In criminal cases in Algeria, the testimony women and men in South Africa, and 2005 for of a female witness is only worth half of a male Kuwaiti women. This week, women in Saudi witness. In Armenia the legal system should treat Arabia are registering to vote for the first time in men and women equally, but women reporting the upcoming December election. The reform of domestic violence are asked what they did to deserve laws and practices has enabled women to claim their beating, or are sent home because wife-beating their space alongside men in public life, a sphere is a family matter. traditionally held by men. I am one of a group of scholars participating But the feminist project is unequal, even in in a global data project called WomanSTATS developed, democratic states, particularly for (www.womanstats.org), which is collecting and women in lower socio-economic classes and among analysing information concerning the situation of particular ethnic groups. For as many women who women, including laws, data, and practices. All joined the ‘why I don’t need feminism’ campaign in of our information is triangulated from multiple the US and UK, there are as many who participated sources, and these sources can vary greatly, thus in the ‘why I need feminism’ campaign. These final decisions require careful analysis of the data recent campaigns demonstrate the fact that points. Here are some of our findings. feminisms are multiple and varied. [See Figure 1 to 6 on page 9] While I would argue that we, in the West, do Let me give you one example not live in patriarchal states, this does not mean that really highlighted the need to that women have full equality with men. Gender include women in development stereotypes and the pressure to conform are still projects. I can recall a study of a present in the education system, the market, and development project in Mexico in homes. If the feminist project is still necessary, regarding the introduction of even in the West, it is particularly so in the developing world. Women’s groups worldwide are struggling to achieve even the most basic Andrea den Boer is senior lecturer in international rights for women, struggling to apply pressure relations at the University of Kent. These remarks were to their governments to change laws, struggling delivered at the Big Ideas Forum hosted by the CIS in to then change practices within their homes and Sydney, 24 August 2015. communities.
POLICY • Vol. 31 No. 2 • Winter 2015 7 GLOBAL WOMEN’S ISSUES
the use of a newly developed strain of maize that anthropologist notes, ‘the degree to which men was resistant to more diseases and therefore could dominate women and control their sexuality is produce higher yields. Despite the fact that women inextricably intertwined with the degree to which are the primary users of the end product (the corn), some men dominate others.’* States in which they were not consulted in the months leading up women are oppressed through harmful laws and to the planting of the crop; only the village men practices tend to undermine the possibility of a were consulted. The harvest was indeed bountiful, functional, capable state. but when the women attempted to grind the maize The practices that are key in terms of women’s to make cornmeal tortillas, they discovered that subordination are those that affect marriage (child this particular strain would not grind with the right and cousin marriage in particular), family law, consistency and therefore was not fit for purpose. and property and inheritance laws. Empirical As this example demonstrates, adopting a support demonstrates that states with high levels gender equity approach benefits more than just of gender inequality and violence against women the women. It benefits the family and community, are dysfunctional: they are more likely to be states in particular, empowering women leads to greater ‘of concern’ in international relations (human rights achievements in overall child wellbeing, family violating), and are more likely to start conflicts and welfare, development, and economic growth. to use greater force during conflicts. One of the key issues faced by women Creating a more gender-equitable world requires and men the world over is violence, whether the mobilization of an international feminist violence in conflict-torn regions or violence in network. This network relies on the support of the home. International relations scholars have feminists in developed democratic states to assist shown that the two are interrelated. The level of in applying pressure to states to change laws and violence exhibited by a state, whether in a civil or practices that are harmful to women. We need, international conflict, is mirrored in the violence therefore, to add our feminist voices to those who directed at women within the state. Peace and believe that feminism has lost its meaning and gender equality are thus united. reaffirm the need for feminist projects at home and There are numerous states where the rights of globally. If some women feel that feminism is no women and girls are subordinated to the interests longer necessary because they are free to enjoy equal of men and to the state. Adopting a gendered lens rights and opportunities with men, wonderful! enables us to see more than just the situation But there are many ways in which they can offer of women, but the possibilities for tolerance their support to women who are still struggling for and governance more broadly, because as one those freedoms.
* Barbara B. Smuts, “The evolutionary origins of patriarchy.”Human Nature 6:1 (1995).
8 POLICY • Vol. 31 No. 2 • Winter 2015 ANDREA DEN BOER
Figure 1
Figure 2
POLICY • Vol. 31 No. 2 • Winter 2015 9 GLOBAL WOMEN’S ISSUES
Figure 3
Figure 4
10 POLICY • Vol. 31 No. 2 • Winter 2015 ANDREA DEN BOER
Figure 5
Figure 6
POLICY • Vol. 31 No. 2 • Winter 2015 11 SYMPOSIUM ON FEMINISM
NEW FEMINISM’S WAR ON WOMEN The arguments once made by misogynists are now made by feminists.
ne of the great misconceptions about media, is that pretty much the only time I hear the New Feminism is that it represents open contempt for women these days is when I’m a war on men. You hear this argument in discussions with feminists. I come from a family from both sides of the discussion, of unreconstructed men. Pretty much every man Ofrom the critics of the New Feminism and from in my family works in the building trade. They its champions, too. The critics say, ‘This feminism read tabloid newspapers, they watch football, they is a really unfair attack on blokes and it should be drink booze. And I don’t hear contempt from any called off,’ and the proponents say, ‘We’ve finally of them, from what is today presented to us, falsely taken the war to the patriarchy, we’re bringing men in my view, as the most sexist section of society: down a peg or two, and it’s about time we did.’ working-class men. Rather, I only hear contempt So both agree, in different ways, that this is a new for women when I’m debating middle-class, movement which has declared war on men, or at media-based feminists, the very people who pose as least on male privilege. the champions of women. The people who make this argument most Just think about the phrases they use. One of their often are men’s rights activists, who are the saddest favourites is ‘internalised misogyny.’ This is the idea people in the world. They live on the Internet. that women have been so brainwashed by patriarchal They spend most of their time in discussion forums culture that they don’t know what’s good for them crying their eyes out. And they blame feminism anymore. The reason they pick certain courses for every problem in their lives. The reason they at university and the reason they go into certain can’t get a girlfriend is because feminism has made apparently female-appropriate careers is because all women into lesbians or bitches. The reason they they’ve been ‘conditioned’ to think that is the right can’t get a job is because feminism has taken over the road in life for them. ‘Conditioning,’ according to workplace and men are no longer welcome. It’s from my dictionary, is the process by which ‘the behaviour these people that you most often hear the argument of an organism becomes dependent on an event that the New Feminism is a war on men, a war on occurring in its environment.’ That’s how many New boys, a war on blokeish everyday life. Feminists view women: as things conditioned by the I think it’s wrong to see the New Feminism in corrupt, patriarchal environment this way, because if anything the New Feminism is that surrounds them. New Feminists a war on women. It explicitly calls into question the also claim that huge numbers ability of women to negotiate public life without of women have ‘body-loathing the assistance of others. It calls into question, not issues,’ meaning they have been so much male privilege, as female autonomy, educated by the media—that is, female capacity. It might mock men, but it does brainwashed—to hate themselves. down women, and it does them down in a very profound way. I was thinking recently that one of the great Brendan O’Neill is the editor of Spiked Online. ironies of my life, as someone who works in the
12 POLICY • Vol. 31 No. 2 • Winter 2015 BRENDAN O’NEILL
They thoughtlessly internalise society’s alleged having trigger warnings attached, in case a fragile loathing of them. female student should read them and feel upset. It’s This idea that women are malleable, fickle worth recalling the 1960 London trial on whether creatures is a rehabilitation of the old, foul notion D.H. Lawrence’s Lady Chatterley’s Lover should that women don’t know their own minds—though be made freely available. One of the lawyers who now it gets dressed up in the pseudo-academic wanted to restrict access to the book asked the now language of ‘internalised misogyny.’ infamous question, ‘Would you wish your wife or Another argument that the New Feminists often servant to read this book?’ The implication was make is that women have very fragile self-esteem. that of course us men can read it, but women? That This is the reason they want to censor pornography, statement is often held up as evidence of how out get rid of Page 3 girls in The Sun, restrict the of touch was the old British establishment at the availability of certain violent videogames, and keep dawn of the 1960s. Yet now a very similar argument sexist hip-hop stars away from their nations— is made by supposedly radical New Feminists: because they believe these images and words ‘We can’t possibly let women see that image or ‘damage women and girls’ self-esteem.’ They read that book, at least not without thoroughly always say ‘women and girls.’ It’s a real sleight of warning them beforehand.’ hand, because in their mind there is no difference between women and girls. This speaks to their New Feminists argue that public life is too very infantilising belief that these two categories harsh, too scary, too brainwashing, and of people, adults and children, can casually be therefore women need special help. spoken of in the same breath, as if an adult woman’s response to a shocking image is no different to what a girl’s response would be: both would be You see the same patronising New Feminist equally damaged, apparently. arguments in virtually all spheres of public life. This idea that women need to be protected from In the workplace, in education, in government images is based on the notion that they are weak, circles: it’s always said that we need to change the fragile, less capable of seeing upsetting things than culture in various institutions in order to make men are. them more welcoming to women. We need to Another favourite New Feminist idea is that make them less male—and what that often means street harassment is rampant. Apparently, over the is that we need to make them less demanding, less past few years, the streets have become incredibly confrontational, more consensual. We particularly dangerous for women: there’s catcalling, wolf- hear this argument in relation to politics. Politics whistling, people who might start a conversation must become ‘less blokey’ and more soft, because with you. And women can’t cope with that, otherwise the wilting wallflowers that New apparently. We are told that society needs new Feminists believe make up womankind won’t feel rules, new regulations, or at the very least a system welcome and won’t cope. of re-education for men and boys—to correct For years feminists argued that women should their habit of engaging with members of the be liberated from the home because they were more opposite sex—in order to help women negotiate than capable of dealing with the rough and tumble their way through the terrifying public sphere. of public life. Now New Feminists argue that This New Feminist view of women as pathetic public life is too harsh, too scary, too brainwashing, reaches its terrifying logical conclusion on campus, and therefore women need special help. The where female student leaders create ‘safe spaces’ and arguments once made by misogynists are now made women-only spaces in which nothing outrageous by feminists. may be said. They call for trigger warnings on It’s also instructive to look at New Feminist books, particularly books that mention sexual books, which have become the latest cash cow of harassment, sexual assault, or rape. Even works the publishing world. They have titles like ‘How of classic literature that mention rape are now to Be a Woman,’ ‘Do It Like a Woman,’ ‘A Book
POLICY • Vol. 31 No. 2 • Winter 2015 13 NEW FEMINISM’S WAR ON WOMEN
for Her.’ They’re a weird mix of self-help and sassy attend university was that their dainty minds broad: Germaine Greer meets Oprah Winfrey would be assaulted by too much controversial meets Frank McCourt; part misery memoir, part matter and by dodgy male behaviour. Today, it’s feministic tract. These books devote much of their New Feminists who claim university is unsafe content to slagging off women. Women who shave for women, everywhere from the library, with its too much, preen too much, who’ve had plastic shocking books, to the university square, with surgery, who’ve obviously been brainwashed by its lads or frats. porno culture or pop culture. In other words, they But I think even this is not the full story. Even don’t know their own minds, and thus they need the calling the New Feminism a war on women doesn’t help of the more spiritual New Feminists, who are tell us everything. Because while the New Feminism heroically immune to their cultural surroundings most openly undermines women’s standing in and are therefore pure, insightful, ready to society, it also represents an attack on humanist, re-educate the rest of us, women and men alike. liberal values, on modern Enlightened ideals. The So the New Feminism represents, not a war on New Feminism is at the cutting edge of undermining men, but a massive insult to women. It’s a really the key ideals of free, democratic societies. dangerous reversal of the enormous gains that In the sphere of Knowledge, for example, New have been made for womankind over the past Feminist ideas have played a key role in questioning hundred years. Women have won the right to vote, whether the truth is really discoverable and the right to work, they were increasingly being depicting rationalism and reason as cold, ‘male’ seen as autonomous, just as capable and free-willed values. The ideal of democracy is being undermined as men. Now that’s all being undone by the New by the so-called feminisation of politics, the Feminism, which has pushed a view of women as notion that we must drain politics of its edge, its fragile, always unsafe, lacking free will, incapable argumentativeness—the lifeblood of democracy— of making autonomous choices due to the and instead make it more consensual. The idea of suffocating culture justice is threatened by New Feminist ideas: the limiting of tough cross-examination in the name of The ideal of democracy is being protecting rape claimants in particular, and the use undermined by the so-called feminisation of kangaroo courts on Western campuses to punish alleged sexual offenders, speaks to the diminution of politics, the notion that we must drain of the idea of justice as something rigorous, fair, politics of its edge. and open. The values of the modern Enlightened age are The Victorian view of women is making a being undermined by the New Feminism. But comeback. In the Victorian era, women were this is not down to some evil cabal of high-heeled often protected from certain printed material feminists who have set out to destroy modern which society, or their chaperones, considered society. Rather, Western society itself has lost unfit for them—now New Feminists seek to faith in those values, over the past few decades, protect ‘women and girls’ from Page 3 or gangsta and it is constantly looking about for a new idea rap. In the Victorian era there were numerous or campaign through which it might make its campaigns designed to protect women from street abandonment of those values look like something harassment. The Lady Magazine, in the late 1800s, progressive rather than regressive. New Feminism ran a campaign called ‘Protection of Women,’ is its latest campaign, the new means though which which depicted the rough, ugly public sphere as a disoriented, post-Enlightened West now jettisons unsuitable for women. That idea is coming back its values of liberty, democracy, justice, knowledge, too. And one of the key arguments made in the and autonomy, under the cynical guise of ‘helping nineteenth century against allowing women to women.’ And girls.
14 POLICY • Vol. 31 No. 2 • Winter 2015 FEATURE
AUSTRALIA’S FUTURE IN THE BALANCE
Overcoming antagonism and reigniting enterprise and prosperity.
ollowing economic reforms that began economic development, that is also the most likely in 1983 and petered out around 2003, outcome in the next ten years or so. Australians enjoyed the greatest advance But the main message I want to leave behind in their living standards since Federation. tonight is that it is not unavoidable. We can do FBut the lagged effects of those reforms have now something about it now. subsided and the post-2003 upsurge in our terms of When, some fifty years ago, I served my trade is being reversed. apprenticeship as an analyst in applied political Neither the political elites nor the wider public economy working for the German Council of appear to have come to terms with this new, Economic Advisers and OECD, I learned that more sober reality. The policy climate has turned ‘growth’ measures the increase in the supply of goods antagonistic, populist, and obstructive. Fiscal and services per capita over the medium to long discipline has been consigned to the ‘too hard’ term. It’s not a year-to-year or quarter-to-quarter basket. There is a new emphasis on redistribution phenomenon. You adjust national production for of wealth rather than producing it, and on short- inflation and take out the cyclical, seasonal, and term demand manipulation instead of policies to weather variations. Economic growth is never enhance the economy’s flexibility and bolster its steady. Over the short to medium term, it always long-term growth potential. In the present policy fluctuates. Over the long term, decades above the climate, there is a real risk of a protracted national secular trend alternate with those below. malaise, repeating the trauma of the Whitlam- If we think about the case of Australia over Fraser era. What is now needed is renewed focus the past 40 years, we see that, in the Whitlam- on the fundamental conditions that will shape our future as a free, open and enterprising society under small and modest governments, firmly anchored in Western civilisation. These fundamental questions—and practical policy decisions that would flow from them—were addressed in the following remarks delivered at the CIS on 25 June 2015.
Wolfgang Kasper The title of this evening’s event is ‘Australia’s Prof. Emeritus Wolfgang Kasper was lead author Future in the Balance.’ Actually, I don’t think it of the Australia at the Crossroads initiative that is! I say this at the risk of being labelled a clown foreshadowed the reforms begun in 1983. by our bonhomie-radiating Treasurer. But if we Paul Kelly is author, most recently, of Triumph and consider economic growth, we have been drifting Demise: The Broken Promise of a Labor Generation. downwards. From my understanding of long-term
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Fraser years, we were well below the trend. I was are defended by political lobbying, worries new in the country at the time and found the about income distribution are ubiquitous. The policies here confused and amounting to monetary vigour of the market is replaced by the rigour of masochism. Because of protection and structural collective action. rigidity, macroeconomic policy was toothless. Though not by nature a Jeremiah, I think that The upswings in the business cycle (that short we are now in a Kondratieff down-wave. Therefore, three-to-five-year cycle of aggregate demand) were we have to think very hard about what to do if we get weak, unemployment ratcheted up, inflation was something like a repetition of the Fraser-Whitlam entrenched, there was much discussion about experience. That would mean that the next up- income redistribution. It was not a happy time—at wave will be delayed until 2025 or so. On the other least not from where I was in Canberra. hand (as I show in The Case for a New Australian Settlement), we could become a frontrunner that Entrepreneurship is a general quality in catches the next up-wave early—if we play our people—not only in businesspeople, it’s in cards right. private people as well. What can be done? To answer this question, you need a theory. My study of long-term economic history and my understanding of international We had another big event in the early ’80s: the comparisons—why certain countries have second oil crisis and a wage explosion which led economic growth and others don’t—suggests to to a recession. We then had the famous Keating me a theory of economic growth that runs roughly sobering-up crisis that “we had to have.” More like this: The economic literature states that the recently, a big event was Wayne Swan’s spendathon, supply of goods and services begins with the a world-record swing from surplus into deficits. mobilisation of production factors. Economic And the effects on economic growth were minimal. growth happens when more labour and skills are Big cost, small benefit! being utilised, when more capital and technology is If we stand back a little further, we see that there employed, when more natural resources are tapped. were two periods of deceleration into below-trend But these are only proximate explanations of territory and a period of acceleration into above- growth. The immediate question then is: why do trend growth (1983–2003). some countries in some periods, for example, This pattern of alternation between generation employ and develop more skills, and others don’t? spans of negative and then positive surprises for Why, for example, do some countries develop most people is well known in economics. It reflects natural resources and others die of the fear what economic historians have long documented of fracking? The answer to that proximate and what is known in the literature as the explication is of course that either there is the right ‘Kondratieff Cycle’—named for a Russian Marxist entrepreneurship or it is lacking. Entrepreneurship statistician, who did a lot of work 100 years ago is a general quality in people—not only in to study the capitalist system. He established that businesspeople, it’s in private people as well. Of Marx’s ‘crisis of capitalism’ was not terminal but course, there are producers, who think about new sooner or later was followed by generation-long knowledge, new products, and new production accelerations of economic growth. Kondratieff processes, although they know that it is risky understood more about waves than Kelly Slater. to develop and test new knowledge. It is always These long waves of economic growth are a risky: Will a new idea be technically feasible? Will socio-psychological phenomenon. It seems that the market make it commercially feasible, i.e. the public mood—the zeitgeist, as the Germans profitable? Entrepreneurship is also present for would say—swings between generations of example when young people invest in themselves: innovation, youth, reform, and generations that do they acquire the right job-ready skills, or do they take economic growth for granted. Things then prepare themselves to become couch potatoes? slow down, untenable social economic positions Now, all this is very risky. People have to incur
16 POLICY • Vol. 31 No. 2 • Winter 2015 WOLFGANG KASPER & PAUL KELLY high costs without knowing whether they will After Federation, we got what Paul Kelly called reap the hoped-for benefits. To confine the risk, the ‘Australian Settlement’: certain shared abstract we must surround the entrepreneurial culture by understandings. For better or for worse, they what the literature calls ‘institutions’—trustworthy, served to create a certain policy cohesion, which enforced traffic rules. In the first instance, these are helped Australia’s economic development and the mores: reliability, honesty, the work habits of underpinned a degree of social harmony. Of course, people, the customs, what in a recent Bonython we also know that, post-1960s, these basic tenets Lecture Deirdre McCloskey called ‘the bourgeois became untenable one after the other, and we got virtues.’ There must also be the right government- The End of Certainty, as Paul described it in his made rules: legislation, administrative regulations, celebrated book. how the courts decide conflicts and interpret In the ’80s and ’90s, we had partial economic matters. What matters most for the economy and reforms, which helped our entrepreneurs to exploit economic growth are secure private property rights the China boom. The China demand covered and the freedom, or otherwise, of their use. Some up the deficiency in our underlying shared social call this economic freedom, others say that growth capital. It also covered up the fissiparous effects requires the right economic order. That is a concept of the IT revolution—the fragmentation, the which is not much used in Australian parliaments. anti-authoritarian consequences that augmented But then you have to go on and ask: why does the lack of basic understandings. In what I would economic freedom flourish in some places and call the “anti-social media,” something new at some stages, but not elsewhere? The decisive emerged, as fewer and fewer people read the factors are not the institutions alone. What really same media and the same books and discuss the ultimately matters are the shared fundamental same issues. values. They decide whether economic reforms are feasible or stymied. This of course goes beyond mere Fundamental conflicts about underlying economics. Some societies are lucky because the values confuse societies, which then tend people and their leaders share understandings that to fail economically. underpin valuable social capital. Good institutions are social capital. They are productive. The right values and institutions are absolutely key to the Of course, diversity in social and political prosperity of a dynamic modern knowledge society. opinion and outlook can be enriching. But if we They are centrally important in service sector go beyond a certain level of cohesion about the production, the sort of activity that now dominates principles and basic values, diversity becomes the economy. fractiousness and increases the entrepreneurial Fundamental conflicts about underlying risks of producing in this country—of investing values confuse societies, which then tend to fail here. And that means slow economic growth. So, economically. Societies that become unsure and again, my question is: can we subscribe to some antagonistic easily start failing and produce less fundamental principles, which constitute an economic growth. Samuel Huntington, in his intellectual and an emotional commitment, which famous book about The Clash of Civilisations, can provide the final stopping point in policy talked about the importance of an agreed centre debates? of social institutional gravity. I want to put to you a list of five elements. The question I want to ask is: could we possibly The first: Australia should be, as it has agree on a new set of fundamental understandings been, committed to individual freedom—self- appropriate to a future Australia that would thrive responsibility, tempered by respect for others. in the global knowledge economy? Fundamental Most of us, the citizens, should spontaneously agreements of what sort of a country do we really reject proposals that violate our freedom. If it has want to leave behind to our children? What sort been established in a debate about a certain policy of a community we want to be? proposal that it violates individual freedom, it should
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be laughed out of court. It should be dismissed. & Safety, by environmental regulations, et cetera, That’s what I mean by ‘final stopping point.’ et cetera. A second basic principle that would serve us well I know a case of a South Coast prawn farmer is recognition that we are open to the world. Much who had a very good project, the science all sorted progress has been made on this front, compared to out. He had already obtained a dozen permits and the old protectionist era forty or more years ago. licenses, from local governments, state governments, But odd remnants are popping up every now federal authorities, which had cost him much and then. To just give you an example: Australia money, nerves, and time. But then there was more has much land; we’re pretty good at building coming, and vexatious labour market regulations apartments and houses with gardens. Why do we on top of it all. So he just gave up. frustrate this sort of ‘export,’ which doesn’t even How many permits did Gina Reinhardt need for leave the country, by being xenophobic to well- her new mine? It’s preposterous! Confused, excessive to-do Chinese and Brits who want to come here regulation is the main problem with innovation and see out part of their retirement years, enjoying and being open to the future. the sunshine? It would be good for all sorts of All governments of course talk about war on high-value services, medical care, tourism, et cetera. paperwork—they always promise us that. But Why do we discriminate against them? Victoria then they allow the lobbies and the bureaucrats even has a discriminatory tax against the Chinese. to inflate the regulatory burden. But everyone Why this emotionalism and xenophobia? It doesn’t should know: red tape kills! It kills private fit us well. enterprise. Let’s streamline. Let’s remove the contradictions, make it simple, let’s go to one-stop shops. Unfortunately, some Australian states have The Australian model of federalism, which introduced one-stop shops, but it turns out that is very centralised, is the last remnant, they are ‘one-more-stop shops.’ the last monument to the Great Australian The next one on my list for a fundamental Handout Tradition. rethinking is government. I want us to have a national discussion on whether we shouldn’t have a small, modest, competing, and secular government. Third, we should also be open to the future. We When I say small, I think we should cut back should laugh out of court the defensive lobbying public spending to 25 percent, maybe 30 percent of by established groups who were high in the total demand. That’s what it was in the Menzies era, pecking order and are now losing their socio- that’s what it is in East Asia. Why not? economic position because they have embraced I want us to be modest about it. We used to wrong models of industry, production, and so have Modest Members, but that was a while ago. on. Let’s reject that sort of rent seeking when Politicians should stop over-promising, especially politicians engage in it and when lobbyists ask for on welfare. Governments cannot deliver, we it. Let’s embrace structural change. Everything that know that. And NGOs, lobbyists, the media, grows changes the structure—a tree that grows, voters should know that big government is bad a child that grows into manhood or womanhood government. This is why governments fail, and why changes in structure. And let’s remove the obstacles the big disappointments are producing a perilous for innovators. disillusionment with democracy. I know many people who want to test new I want governments in Australia to be competitive. productive ideas. But I can tell you that the people We have to rethink federalism. The Australian I talk to are not motivated by a 0.25 percent model of federalism, which is very centralised, is interest rate reduction to be enterprising or not. the last remnant, the last monument to the Great That doesn’t trigger enterprise, although our Australian Handout Tradition. It’s redistributionist Treasurer tried to make us believe that the other and leads to irresponsibility. Canberra taxes; the day. They are hindered by Occupational Health state and local governments avoid the problem
18 POLICY • Vol. 31 No. 2 • Winter 2015 WOLFGANG KASPER & PAUL KELLY of taxation and get most of their funding from democracy in this and in European countries. Canberra Centre by posturing, by lying at Premiers’ I recommend a look at the Swedish experience of conferences, and then hindering economic reforms about ten years ago with charter schools growth. It’s just undignified how these Premiers’ that had to start competing for school vouchers. conferences are conducted. The quality of teaching went up enormously; good We need a devolution of powers to where teachers really started to like it. With hospital care, a government function can be done best. The I find inspiring material in the trust hospitals in technical word is ‘subsidiarity,’ which is the essence Spain and in the UK: great savings, great quality of what is called competitive federalism, to end the improvements, the mobilisation of creativity, cartel we now have of high-taxing, big-spending diversity (different communities need different governments. The technical term again to throw types of service), and the mobilisation of local in here is ‘fiscal equivalence’: each government voluntary resources. People like to volunteer, they is allotted or assigned certain tasks and raises the like to be engaged, and that’s good for democracy! taxes to fulfil these tasks as it sees fit. In doing so, Finally, I want the government to be secular. governments act in competition with each other. The atrocious European wars of religion have Some states or councils may promise less and tax less, taught us that the separation of church and state is others may try to provide gold-plated streetlights essential, absolutely essential, for social peace. And and tax the local citizens a bit more. (The newly we must expect all immigrants to commit to this, minted Member of Parliament for Eden-Monaro, otherwise they don’t fit in here. Peter Hendy, has some very good ideas about this reform as a basis for reshaping the federation. If the states are responsible for raising I wholeheartedly agree.) their own resources, I bet you they will Once state and local governments are responsible find big savings that now, we are told, for raising their own funds from the taxpayers, they will become interested in growing their own tax are impossible to find. base, in cultivating local economic growth. Just to give you an example of how things could happen: The last point in a New Australian Settlement: imagine that local governments got a share of the we have been and should be absolutely clear that mining revenue in their district, can you imagine we want to continue to be part of Western what would happen if a local government would civilisation. Australia is exposed, we are an outrigger write to the electorate and say: ‘Should we allow in the Asia-Pacific region, a frontline state of the fracking in our district and you get a 20 percent West. Long-term investors need strategic clarity rate cut, or should we ban fracking forever and on that. We should acknowledge that we are your rates will increase this year by 7 percent and becoming a multiracial country, that’s fine. That’s likely double in ten years’ time?’ I bet you that probably a great potential growth asset. But we must Lismore will get cracking on fracking. If the states understand that this doesn’t mean that we become are responsible for raising their own resources, a multicultural country. That leads to fractiousness I bet you they will find big savings that now, we and disruption. are told, are impossible to find. Of course, we need substantial immigration But we know that the welfare state is broke. to grow the labour force and much more. But we We know that centrally-planned government should be selective about whom we admit here. monopolies to deliver education, health care, public We should welcome those who fit in and who housing, and so on—administered by cumbersome, appreciate our basic values. We can judge which risk-averse administrations and dominated immigrant groups integrate by maybe assessing frequently by entrenched public sector unions— their workforce participation, intermarriage rates, have become unaffordable. and incarceration rates. Because if we ignore these Ineffectual service provision is another factor, things, our skills base will suffer—and that’s bad I think an important one, in the disaffection with for economic growth. Welfare dependence will
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explode, and essential social capital will deteriorate international competitors. Our boom became the further. envy of the Europeans. But the boom was not This list of five elements together is what I mean God-given. We earned it. If you know these export by a New Australian Settlement. Getting them industries, you will appreciate that they competed widely accepted will not be easy. Recent trends that successfully against other producers of coal and we have observed in economic freedom have not iron ore, because they were relatively free to do that. been encouraging. They point, to my mind, to a In the late Howard era, progress on economic continued Kondratieff downturn: to a slowdown freedom stalled, and we know that the Rudd- into real economic crisis. Gillard-Rudd backsliding on labour markets, and In the world as a whole, we have been stalling their government deficits, did great damage. I only on economic freedom. There were massive wish that the Abbott-Hockey administration were improvements—Reagan and Thatcher, the fall of not so clueless about economic freedom. It matters! the Soviet Empire, China’s capitalist revolution– Demand manipulation won’t reignite real long- that have triggered in the world at large (according term growth. Easy money, a bit of public spending, to analysis of about 160 countries on average) the a mini tax cut here or there is not sufficient to ‘Golden Growth Era’ of the 1980s and 90s. Now power up the supply side. it’s stalling. When I speak like that, I’m of course at variance The United States used to be the benchmark, but with the model builders that dominate the Treasury, it’s started to lose ground massively under Bush’s with Keynesian bureaucrats who seek power to compassionate conservativism and the engagement manipulate the levers of the economy. But I find in costly wars without concern for the budget. myself in agreement with many business leaders Isn’t that reminiscent of Tony Abbott sometimes? and elder citizens. And more recently we have had Obama’s big One short, final point: growth is a long-term society interventionism, and now Clinton evokes supply side phenomenon. We cannot take the Roosevelt—Heaven forbid! So, the US does not underlying economic order for granted. It needs look to me like becoming a leader again. regular, conscious cultivation. In my career, moving around the world and More freedom allowed Australian looking at success stories, I found time and again producers to meet the China demand better that economies that had an advocate for economic than some of our international competitors. freedom and the supply side at the cabinet table were successful. I grew up in post-war Germany where ‘ordo liberalism,’ as they called it, created In Australia’s history, economic freedom a very quick recovery and record job creation. It suffered from the Whitlam shock. It grossly was not an ‘economic miracle’. It was good policy, diminished economic freedom and stimulated good philosophy. I discovered the same in the Asian inflation. That had much to do with slowdown of tiger countries. Australian economic growth in the ’70s and up to For the present, I would invite you to look at 1983. We then had the partial reforms by Hawke the most successful growth success story in the and Keating They had two holy cows: labour Eurozone, which is Spain. In the last three years markets and big welfare were untouched. But the conservative government has had a Minister otherwise they were pretty good reforms. This was of the Economy and Competitiveness, who is a followed by partial reforms in the Howard-Costello very forceful voice at the cabinet table for long- era. The budget got sorted out, partial labour term prosperity, freeing up labour markets, capital, market reforms were gradually introduced, all of natural resource development. which accelerated the up-wave in economic growth We are now facing, whether we like it or not, that we all found so inspiring. a new era of free trade, thanks to all these new More freedom allowed Australian producers to free trade and investment agreements. If we don’t meet the China demand better than some of our have a political agency within the government, the
20 POLICY • Vol. 31 No. 2 • Winter 2015 WOLFGANG KASPER & PAUL KELLY juggernaut of free trade from the US, Japan, Korea, society to have a much more concerted discussion China, and globalisation generally, will destroy jobs about the nature of the problem. in this country. We will be sitting there like rabbits I’m talking in particular about the state of in the glare of headlights. I would therefore propose parties, the condition of the parliament, the a Department of Economic Affairs that argues for operation of executive government, the operation making the supply site flexible and fosters economic of the media, and the country’s political culture. freedom. It can draw together the Productivity So that’s a pretty sweeping agenda. Commission, Trade, Industry, Industrial Relations What we see in Australian politics is the to foster long-term prosperity. fragmentation of the party system, or loss of faith Free trade and free investment is an opportunity. in the party system. John Howard has used the But we have to prepare for it. Growth and job formula that we used to have a 40/40/20 political creation are not automatic– I see too little realisation system—that is, 40 percent committed to either of that. If we remain rigid and reactionary-defensive, side of our politics and 20 percent floating. He now we’ll prolong the era of disappointment and misery. says we have a 30/30/40 system. All this of course goes beyond mere economics. It’s a moral issue, ultimately. We can’t leave it to I think the public has lost any sense of politicians, because they think too short-term, are awareness of the reasons for Australia’s too opportunistic. Maybe they lack the courage prosperity over the past generation and some lack the candlepower to understand the and a half. underlying issues. We therefore need a national debate, maybe initiated by groups of experienced leaders who This could actually be good. This could lead to could argue the merits of a ‘New Settlement.’ Let’s a more fruitful democracy, but I certainly think discuss the pros and cons of what I’m proposing it’s a challenge for the system, it’s a challenge here and foster an understanding in our society of for political parties, and what we are seeing is what it takes to make for prosperity and freedom. fragmentation particularly on the Left, where there is now a divide between the Labor Party Paul Kelly and the Greens. And I think that’s a permanent I think the state of the political system at the change. The conservative side of politics has held moment is pretty much the worst we’ve seen in together much more successfully. But we did see the last 35 years or so. After 23 years of economic a very successful performance from Clive Palmer growth plus a resources boom, a bedrock at the last election, taking quite a few votes away complacency has taken hold. It has various from the Coalition. manifestations: a decline in self-reliance, a culture In the Senate, the parties are responding to this. of complaint, the rise of social envy, a growing There is a breakdown of trust. Labor has changed dependency on government, a political system arrangements for the election of the leader that based on bidding up expectations about had many unintended consequences, but it’s a very government’s capacity to satisfy more needs and significant change. I think one of the consequences wants with the probability that people will only is that it will take the party further to the left grow more dissatisfied. Finally, I think the public because it empowers the rank and file in terms of has lost any sense of awareness of the reasons for the appointment of the leader. Labor should review Australia’s prosperity over the past generation its traditional links with the trade union movement, and a half. I believe this is an intellectual and but that remains an embryonic debate with not moral failure. a lot of progress so far. I think the problems in the political system are I think the parliament clearly is in a most multifaceted. I believe they won’t be easy to solve. unimpressive condition, filled with all sorts of I think they go to technology, the structure of difficulties, a lot of structural problems. Clearly politics, our politicial culture. I think we need as a the Senate is a real difficulty. I think there should
POLICY • Vol. 31 No. 2 • Winter 2015 21 AUSTRALIA’S FUTURE IN THE BALANCE
be reform of the Senate voting system. I would the mining industry against the Mining Tax. There highlight the fact that some of the crossbenchers are many examples—these are just some of the have been elected on an extremely small proportion main ones. What I am talking about simply is of the primary vote. I would highlight the fact the power of the negative. And it’s got to the stage that Section 57 is essentially destroyed for a prime in this country where we can’t even debate issues minister in terms of coming to grips with the any more. It seems to be impossible to have a debate conflict between the House and Senate, because about industrial relations reform or a debate about if you call a double dissolution it only guarantees the GST, a debate about fundamental changes to that you’ll have even more minor parties in the Medicare, or more recently—as we saw this week— Senate. So I think overall the House has been getting private money into government schools. weakened against the Senate. In many aspects I think we resemble a stupid country. If you can’t actually discuss our options and policy possibilities then I think you are in The media operates now in real time and serious difficulty. So the combination of being run this is a tremendous difficulty for by the polls—and have no doubt that the polls are the politicians. an insidious influence on what happens in Canberra every time they are published—the combination of the polls and negative politics leads to the virtual We’ve seen fundamental changes in the structure perpetual internal crisis of the political parties. of the media, fragmentation of the media, a much We saw this in terms of the Rudd government, more volatile media environment, the rise of social the Gillard government, the Abbott government. media, a weakening of the traditional sources of It’s extraordinary that Tony Abbott had been Prime media—newspapers and the television networks. Minister for less than 18 months when there was Again, this can be seen as potentially a good thing, a movement in the party room last February to a flowering of opinion, a flowering of democracy. depose him. What it indicates is the weakness But I think, frankly, looking at this from the point of the political parties, their susceptibility to of view of the politicians trying to muster support panic, to the public opinion polls, and their lack for their policies, it makes it far more difficult for of conviction. them. The media operates now in real time and The parties aren’t strong enough. They exist to this is a tremendous difficulty for the politicians. govern; they exist to get onto the Treasury benches. Everything is short-term. Every day is just driven If they’re exposed in opposition, their weakness by the immediate issues, by the news coverage that is naked. They don’t have sufficient ideological morning, by the breaking news at mid-morning, strength in terms of beliefs and commitments and it’s driven by the cable television, by Sky, by to tolerate being in opposition. So the essential social media. The main task of the politicians today rationale of both parties is to do whatever is is to avoid making mistakes. Mistake avoidance is required to govern. What we now see is the conflict absolutely the imperative these days. And we see between politics and the policy requirements of the when a politician gets into trouble, when a political country. We’ve got a budget deficit, we’ve got a debt leader gets into trouble, they get into trouble problem, we’ve got demographic issues coming up. because of a mistake. Essentially these issues have got to be addressed This tells us that the power of the negative as a but they’ve got to be addressed in terms of a result of technology is simply enormous. Look at political system which has trouble debating the the many, many examples: the destruction of the issues — let alone debating the answers — and a Howard government in terms of the campaign political system which is resistant to accepting any against Work Choices, Tony Abbott’s very effective sort of losers. negative campaign against the Carbon Tax, the I conclude that governing is harder than it’s Labor opposition’s effective campaign against the been before and that reform is harder still. I think first Hockey-Abbott budget, the campaign of there are two underlying problems. The system is
22 POLICY • Vol. 31 No. 2 • Winter 2015 WOLFGANG KASPER & PAUL KELLY more difficult, but the quality of leadership has and respond to the community, and be seen to deteriorated. be responding. An interesting combination of We see the rise of single issue politics and we see a leader who at times could be strong, and at times the great dilemma that politicians face. All the time could give significant attention to consensus. We they’re asked to rule things out. And they know need dialogue between stakeholders and building that if they don’t rule things out, the power of the up coalitions of support for new policy. negative campaign in the media against them will Point three: independent analysis. There’s no be lethal. But if they do rule things out, when they substitute for independent analysis. We need a lot get into government they find that their options more independent analysis put on the table, which are heavily circumscribed and then they run into can be the foundation for debate and forming the problem of breaking promises. We all know public opinion. about the consequences of that. I think what we see in Australia today, given the problems we have with the economy, is a new Governments are trying to do too much. ideological conflict between Liberal and Labor. The Implementation is incredibly difficult. actual degree of policy difference, far from being minimised, is actually expanding. It encompasses productivity, competitiveness, tax reform, industrial relations, climate change, spending entitlements, Point four: we need to recognise that most reform of Medicare, pension sustainability, higher policy answers are going to be compromises. In education, industry policy. All these areas are the environment we are now in, we should not let the site of very significant differences between the perfect be the enemy of the good. We should both sides. recognise that progress is going to be based on Well, what should be done? Let me give you a a whole series of compromises—far better quick seven-point program. compromises in the right direction than Point one: explain the problem, explain the compromises in the wrong direction. problem, explain the problem. The politicians Point five: I think, to use a famous slogan from are not explaining the problem. This is quite the 1980s Hawke and Keating, we need ‘growth extraordinary. Explaining the problem goes to with equity.’ We need growth with equity not just expectations. They’ve got to change and mould as a rhetorical position but as a genuine policy expectations on the part of the community. You position in this country. There is no question don’t go out and tell the community that they’ve about this. got to live with less; you explain the problem. Point six: governments must remain strong in We’ve got to have a more intelligent the electorate. A government that is weak in the conversation, and we need politicians who are electorate is going to be weak in policy terms. capable of having that intelligent conversation So the government has got to be able to remain and mobilising elements of civil society for that. strong and use that strength for reform. I should say that I think the public understands at Point seven: implementation. We need to this point in time that the country actually does rethink the whole process of implementation of have some serious problems and they would policies. Governments are trying to do too much. appreciate some frankness about that. Implementation is incredibly difficult. You don’t Point two: I think there’s got to be a lot more change the country simply by passing a law; you dialogue and negotiation between stakeholders, have to implement new policies and get the and the construction of policy coalitions between implementation right, and recognise the limits of various stakeholders. Scott Morrison understands government in doing that. this, and he’s done this very well quite recently. Finally I’d say, despite the difficulties I just Hawke as prime minister was a very good example talked about, our prospects in terms of the of someone who would listen to the community, Western world are better than most countries.
POLICY • Vol. 31 No. 2 • Winter 2015 23 FEATURE
MAGNA CARTA: THE RULE OF LAW AND LIBERTY The principles inherent in the document developed by incremental steps.
he document to which King John affixed The liberties often associated with the Magna Carta his seal on this day 800 years ago was were a product of the institutions of Parliament intended to be a peace treaty to end a and the Courts, over the course of centuries. civil war. As such, it failed. Within However, the development of those institutions was Ttwo months, the King repudiated it and the Pope significantly influenced by the Magna Carta. declared it void. The Civil War reignited. However, At the heart of English constitutional John died about a year later and an amended evolution—particularly in the six centuries between version of the Charter was issued as a coronation the Norman invasion of 1066 and the aftermath Charter in the name of his nine year old son, of the Dutch invasion of 1688—was the tension Henry III, on his accession in October 1216. between alternative bases for the legitimacy of the This reissue of the Magna Carta, was in a long institutions of governance. On the one hand, was line of promises of good governance, traditionally a top down model of legitimacy from a sovereign. given by a king on his coronation. Historically, On the other, was organic legitimacy from the when the monarchy was strong, the Coronation emergence of institutions over the course of oath was short and expressed in general terms. centuries. When the monarchy was weak, a more detailed The Magna Carta and the Forest Charter list of promises was required and given. stand in, and propagate, the tradition or organic The final reissue by Henry III, in 1225, of the legitimacy. They draw on, and purport to reassert, Magna Carta—about a third of the 1215 text had the customs of the past. However, the Charters gone—and its companion, the Forest Charter, to also contain promises about future conduct which the significance of which I will return, was not just were reforms. a formal act. Nor was it simply a list of grievances The Magna Carta of 1215 is to be remedied. By reason of their scope and detail, expressed as a ‘grant’ issued on together with endorsement by the loyalist barons, the advice (in older translations the Charters constitute the first comprehensive by the ‘counsel’) of eleven named statement in written form, formally promulgated ecclesiastics, sixteen named lay to the whole English population, of the barons and an unknown number requirements of good governance and of the limits of unnamed ‘faithful subjects’. upon the exercise of political power. I am asked to focus on the significance of the Magna Carta for the rule of law and liberty. My answer to the first is forthright. We can legitimately James Spigelman is a former chief justice of the trace the strength of our tradition of the rule of law Supreme Court of New South Wales and lieutenant to this document. With respect to liberty, however, governor of New South Wales. These remarks were the position is equivocal. The Charter has often originally delivered at an event of The Centre for been deployed in support of the development of Independent Studies on 15 June 2015. liberties, but that deployment was, at best, indirect.
24 POLICY • Vol. 31 No. 2 • Winter 2015 JAMES SPIGELMAN
The last inclusion is of significance. The first clause they were affirmed by its content and context in of the Charter states expressly that the promises a concrete form. It is these themes, as developed in the subsequent clauses are ‘liberties’ granted to and applied in changing circumstances over the ‘all of the free men of our realm’, for the benefit of centuries that gave the Charter the significance we themselves and their heirs, binding King John and commemorate today. his heirs ‘forever’. The reissues and confirmations of the Charters This was a document for the entire political were distributed widely throughout the kingdom nation, not just for the secular and clerical magnates. to sheriffs and cathedrals, with instructions that Both the language of ‘grant’ and the identification they be read, sometimes more than once a year, of the political nation are pregnant with future to the whole community. This happened not only constitutional development. Was this list of in Latin, but French, the language of the upper political promises an act of benevolence on the classes, and there is some evidence that, on part of the King, or was it an acknowledgement occasions, they were read in English. The Charters by the King of restraints on sovereignty arising quickly penetrated the consciousness of the from custom and law? Similarly, who is entitled to political nation. offer counsel to the King: the clerical and secular Whatever their limitations and problems of magnates alone, or a wider range of free men? enforcement, over the course of the first century, These issues would not be resolved for centuries. the Magna Carta and the companion Forest In the great tradition of the common law, the Charter acquired a totemic status as a statement Magna Carta is an intensely practical document. of principles of good governance. The King was There are few statements of high principle. asked to confirm the Charters on numerous Primarily, it consists of specific promises to restore occasions, particularly when assent was sought compliance with proper conduct. One can, for new taxation. Furthermore, grievances were however, deduce certain themes which underlie generally expressed in terms of a failure to obey the Charter. the Charters. First, the acts of the King are not simply personal acts. The King’s acts have an official character and, The Magna Carta was invoked when accordingly, are to be exercised in accordance with certain processes. a king asserted that he was above the law. Secondly, the Charter manifests the obligation of the King to consult the political nation on important issues. Thirdly, the Charter restricts the exercise of the Rule of Law King’s feudal powers—subsequently transmogrified From the point of view of the rule of law, nothing into prerogative powers—in accordance with was more critical than the proposition that the traditional limits and conceptions of propriety. King was subject to the law. This principle was Fourthly, the King cannot act on the basis of not established by the Charter, but there was no mere whim. The King is subject to the law and previous written affirmation, let alone one publicly also subject to custom which was, during that very read many times throughout the nation. The most period, in the process of being hardened into law. important legal texts of the next two centuries Fifthly, the King had in fact acted contrary to asserted this proposition as fundamental to the established custom and, to some degree, contrary polity, albeit without referring to the Magna Carta. to the law. These are the works known to lawyers as Bracton Sixthly, the King must provide a judicial system and Fortescue. for the administration of justice and all free men The Magna Carta was invoked when a king were entitled to due process of law. asserted that he was above the law. Richard II and The principles inherent in these themes were the Stuarts did that. Shakespeare made it clear, in not established by the Magna Carta. However, his Richard II, that this assertion was part of the
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King’s downfall. He did not mention that Henry payable to allow a widow or a ward to marry, or the Bolingbroke invoked the Magna Carta. Indeed, amount payable to avoid the obligation to provide Shakespeare could write King John without knights, or many other feudal payments that mentioning the Charter. Victorian theatre producers could be requested from time to time, in the introduced a Runnymede scene, as something the discretion of the King. bard had overlooked. In addition to these incidents of land holding, It was not a favourite text of either the Tudors there were numerous other discretionary sources or the Stuarts. After all, one of the few times it was of revenue: fines for an offence, even payments for invoked under the Tudors was when Thomas More the king’s mercy when there was no offence, and pleaded clause 1, guaranteeing the liberties of the the assertion that circumstances had arisen when church, before Henry VIII. property could be forfeited. All of those powers were abused by King John. The same was true of the revenue raised from the extent of the royal It would be accurate to describe the forest and the restrictions on conduct within baronial rebellion against John, it—the subject of the Forest Charter. It would be in large part, as a ‘tax revolt.’ accurate to describe the baronial rebellion against John, in large part, as a ‘tax revolt.’ The provisions of both Charters restraining It was Sir Edward Coke, in reaction to the the abuse of the King’s powers for the purpose of Stuarts, who invested the Magna Carta with the raising revenue manifest the proposition that the mythological status which has been handed down King was subject to the law. This was, and is, at to us today. There is, however, nothing mythical the very core of the rule of law. The majority of about the proposition that the Magna Carta provisions of the Magna Carta require the King reinforced, even if it did not establish, the to cease or modify particular conduct. The most fundamental principle that the King was subject significant field in which the Charter requires to the law. the King to do more—rather than less—is in the The largest number of clauses of the Magna provision of justice. Carta, in all versions, were those directed to The Magna Carta contains a range of promises preventing the King’s abuse of incidents of feudal directed to preventing abuses and improving tenure and social structure to raise revenue. Of the the institutions of the rule of law. Their very 37 clauses of the 1225 version, which I use, all of scope manifest an intention to benefit the whole these provisions either imposed, or to an unknown community: extent confirmed, restrictions on the exercise of powers that were a product of the complex of • Cases involving inter-personal disputes, mutual rights and obligations attached to the known as common pleas, would not follow possession of land—which was ‘held’ from a the ambulatory royal court, but be fixed in superior, rather than owned. a particular place, eventually Westminster There was a wide range of such powers which (clause 11) (I refer to the clauses of the were open to exploitation by the King. Abuse was permanent 1225 Charter, not the 1215 inherent in a system that permitted when, and how Charter). much, the King could demand in payment for exercising, or not exercising, his feudal rights. I give • Disputes relating to the ownership of land only a few examples. would be heard in the counties in which the When a tenant in chief died the land reverted to land was located and determined by visiting the King. There was no formal limit on how long justices, sitting with local knights (clause 12); he could exploit the land before allowing an heir to inherit, nor on how much he could charge to • Royal justices would visit annually to hear the permit him to do so. Similarly, with the amount most common causes of action for recovery
26 POLICY • Vol. 31 No. 2 • Winter 2015 JAMES SPIGELMAN
of land and inheritance (clause 12, reduced The best known promise, and the one of abiding from quarterly visits in the 1215 version, significance for the rule of law throughout the clause 18); 800 years we commemorate today, is clause 29 of the 1225 Charter. It is an amalgamation of clauses • Fines for offences would be extracted only for 39 and 40 of the 1215 Charter. It states: serious offences, would vary with the gravity of the offence and would be imposed only on No free man is to be taken or imprisoned the oath of law-abiding locals (clause 14); or disseised of his free tenement or of his liberties or free customs, or outlawed or • Pleas of the crown, i.e. serious criminal exiled or in any way be ruined, nor will charges, would not be heard by sheriffs, we go or send against him, except by the constables or coroners, but only by justices lawful judgment of his peers or by the law (clause 17); of the land. To no one will we sell, to no one will we deny or delay right or justice. • Constables and bailiffs would not take private property without full payment in Like a number of other clauses, this provision cash (clause 19); is expressly addressed to all ‘free men’ —not just to barons. It is wrong to say, as is sometimes said, • Sheriffs and bailiffs or, for that matter, any that the Magna Carta was only designed to protect other person, would not take horses or carts, the barons. save on payment of a prescribed amount, nor Nevertheless, it is pertinent to note that only a any timber, except by consent (clause 21); minority of the population were then ‘free men.’ The bulk of the population was not free. Only • The writ of praecipe would no longer issue to clause 14 of the 1225 Charter, imposing restrictions remove to a Royal Court a cause of action, on amercements, expressly extended to villeins. which was properly before the court of a However, in the fourteenth century, the statutes Lord (clause 24); of Edward III extended the protection in clause 29 to the whole population. • No bailiff would put anyone on trial upon his own word, without reliable witnesses It is pertinent to note that only a minority (clause 28). of the population were then ‘free men.’ • The frequency of shire courts was regulated, as was the amount sheriffs could exact in The better, albeit not unanimous view, is that the hundred courts from the system known the reference to judgment of ‘peers’ was a reference as frankpledge. (clause 35) to social equals, not just to barons. It was soon called in aid by mere knights. Furthermore, Many of these provisions appear to be promises notwithstanding many statements to the contrary of reform, rather than assertions of past custom. that can be traced back to Sir Edward Coke, However, writing them down made those which clause 25 was not the basis for the development were customary more readily enforceable. These of the jury system. The event of 1215 that caused promises constituted a guarantee of the rule of law the investigating jury—or Grand Jury in modern appropriate for that era. Collectively, they built parlance—to develop into the ‘petty’, later the trial, on the foundation of the existing institutions of jury, was the decision of the Lateran Council in justice—particularly as created by Henry II, John’s Rome that very year to prohibit any priest being father—and established the basis for their future involved in trial by ordeal. development. We can recognise this guarantee as The implementation of the companion Forest our direct legacy. Charter was of equal significance for the rule of
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law. The Royal Forest was not an area of minor curtailment. Whenever assent was given by the significance. It is estimated that something between political nation to new taxation in the first century one quarter and one third of England was part after the Charter, Henry III and Edward I, John’s of the Royal Forest. This ‘forest’ was not simply son and grandson, confirmed the two Charters woodland. It encompassed cultivated areas, even as part of an express exchange for a new tax. villages, which were privately held. Forest law trumped common law. The draconian Liberties rules of the Forest, governing virtually anything The Magna Carta is often referred to as a Charter that people could do in this substantial part of of Liberties. The Latin word usually translated as the nation, including on their own property, was ‘Liberties’ appears on a number of occasions in administered in a tyrannical manner. It constituted the Charter. However, the word ‘Liberties’ was an abuse of the royal prerogative in its most not then understood in the sense that we use the absolutist form. This is the background to the story word ‘rights.’ It was closest to what we would call of Robyn Hood, still the only fictional character ‘privileges and immunities.’ Nevertheless, these in the Dictionary of National Biography. medieval ‘liberties’ constituted a sphere of The Forest Charter did result in improvements autonomous conduct, free from constraint by in the administration of forest law. For example, government and, in that sense, constituted the death penalty for taking deer was abolished, ‘freedoms,’ close to contemporary usage. although deer hunting remained the exclusive The Charters contained a list of restraints on preserve of the Kings. The promise to reduce the executive power, addressing the abuses of the extent of the Royal Forest was continually delayed, day. What came down over the centuries, was the until late in the reign of Edward I. It will no doubt general idea that the powers of the sovereign were come as a great shock to this audience to hear that restricted. It is anachronistic to characterise these in medieval times, political promises were not restrictions as a recognition of the ‘rights’ of always kept. It took a century, but these promises subjects. However, over the course of centuries, were eventually honoured. these ‘liberties’ have transmogrified into ‘rights.’ From the point of view of the majority of As the Lancastrian warrior turned Chief Justice, the population, not just free men, the Forest Sir John Fortescue, put it in the late fifteenth Charter was of greater practical significance century: in France the king was ‘regal,’ but in than the Magna Carta. Much of the forest was a England, the king was both ‘regal’ and ‘political.’ commons—including for timber, the essential It is possible to eke out of particular provisions fuel and building material—available even to of the Charter an underlying principle, which peasants. The Forest Charter deserves to be more could be stated at a higher level of generality than widely remembered for its significant contribution the time bound grievances expressly addressed. to the rule of law in England. For example, protection of the right to property can be deduced from the provisions which restricted the King’s revenue generating powers. Many Over the course of centuries, these clauses impose controls on such powers, usually ‘liberties’ have transmogrified into ‘rights.’ in general terms, but sometimes in detail—with amounts stipulated, circumstances of imposition excluded or a standard of reasonableness, or of The combined effect of the restraint on the custom, expressed. ability of the King to extract revenue by abuse of Further, the principle of no expropriation feudal incidents, and by the enforcement of the without compensation can be inferred from Forest Charter, resulted in a major curtailment of specific restraints on sheriffs and bailiffs from royal revenue. The development of Parliament, out taking property with compensation and, in the of the feudal assemblies which were called to agree case of horse carts, stipulating a particular rate. to periodic royal taxation, was a direct result of this The companion Forest Charter, similarly, removed
28 POLICY • Vol. 31 No. 2 • Winter 2015 JAMES SPIGELMAN some restrictions on what people could do on their of royal courts, it created the institutional basis own land. for the future expansion of personal liberties by Other traditional liberties are more difficult Parliament and the Courts. to identify in the Charter. One must not Although the constitutional impact of the overlook those parts of the Magna Carta that are Magna Carta was greatest in its first century and inconsistent with liberty. For example, one provision in the 17th century, it was of more consistent expressly forbids a woman to give evidence in any significance for the legal system. The Charters were case against a person for murder, unless the deceased referred to in legal proceedings on a minimum happens to be her husband when, presumably, of fifty eight occasions in their first century. even a woman could be believed. Furthermore, in an era when the quantum of The 1215 Charter prohibited the payment litigation increased dramatically, the Magna Carta of interest on debts owed to Jews in certain became a basic tool of the legal profession. It was circumstances. This clause was not repeated in the no doubt, in large measure, its concreteness as a 1225 Charter, but that did nothing about existing text that facilitated reference to its provisions for discrimination, derived from the combined effect purposes of litigation. The Charters acquired the of usury restrictions on Christians lending money status of a statute and, at the end of the century, and the restrictions on Jews engaging in other the Magna Carta became the first statute in the economic activity, e.g. the prohibition on any Jew official Roll of Statutes. owning land. Jews were protected by the King as a source It is appropriate to note what a good of feudal revenue. For example, when a Jewish investment the Menzies government lender died, the King expropriated his rights made when it bought our copy for as creditor. Indeed, when Edward I, to popular £12,500 in 1951. acclaim, ordered the expulsion of all Jews, he was expressly compensated for his loss of revenue by an additional tax. A good representation of the use of the Charter It is also necessary to remember the restrictions by lawyers is found in the 1330 printed compilation on liberty about which the Charter offered no of 20 statutes, commencing with the Magna Carta amelioration. A substantial proportion of the and the Forest Charter, presently on display at the population was held in a condition of slavery and State Library of New South Wales. This antiquarian remained so. People were still executed for heresy volume, in its original binding, was probably the for some three centuries and the executive property of a practising lawyer, for use when on continued to detain subjects at will and to deploy circuit throughout England and Wales. This is a torture in interrogations for four centuries. It was physical embodiment of the rule of law at work in also four centuries before any intrusion was made the technology of the era. into the restrictions on freedom of religion and The version in the statute book was the freedom of expression, and it was well into the 1297 confirmation by Edward I of the 1225 19th century before Roman Catholics and Jews Magna Carta. The copy in our Parliament House had equal civil rights. Homosexuals had to wait is one of only four surviving copies of that 1297 for another century. In the actual control of confirmation. Because that is the version which the exercise of executive power, the courts were acquired the formal status of a statute, it has constrained until the Act of Settlement, 1701 took been of greater practical importance than the away the power of the King to remove a judge 1215 Charter. from office at will, as James I removed Coke as It is appropriate to note what a good investment Chief Justice. the Menzies government made when it bought With respect to human rights, the Magna our copy for £12,500 in 1951. In 2007, the only Carta was not much of a start. But by entrenching copy of the 1297 confirmation in private hands the rule of law and promoting the expansion sold at auction for US$21.3 million.
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Abiding Relevance Carta, together with its elaboration in statutes of A classic example of the significance of the Magna Edward III, the House demanded that the King Carta was its deployment in the conflict between acknowledge that no person could be imprisoned the Stuarts and Parliament arising from the historic without cause shown. Five Knights case, culminating in the Petition of In the course of the interchange between the Right of 1628. After failing to obtain additional House of Commons and the House of Lords, taxation from his first Parliament in 1626, Charles the latter appeared to support the King’s position I dissolved Parliament and proceeded to raise by inserting a qualification in the draft: adding funds without Parliamentary approval by way of a the words ‘saving the Kings sovereign power.’ In forced loan. his vehement reply, Sir Edward Coke declaimed: A number of subjects refused to advance the ‘Sovereign power is no Parliamentary word… funds demanded by this executive measure and were in my opinion it weakens the Magna Carta… imprisoned without charge by the Privy Council, Magna Carta is such a fellow, that he will have no acting as a prerogative court. They were refused sovereign.’ As Coke often had to do, he offered bail on the basis of an assertion on the part of the a weak explanation of why he had not always prosecution that the king had an absolute right, applied these principles when he was a judge, let as a matter of state necessity, to keep anyone in alone when he was the Crown’s chief prosecutor as prison without giving reasons. Some of the accused Attorney General. wanted to force the prosecution to state that the After much prevarication, the King accepted the only reason was their refusal to pay the loan. Petition and the ability of the executive to deprive citizens of liberty without cause, henceforth, The Charter became a ‘myth,’ in the became illegal. Acceptance of the Petition, which sense that it has been invested with a encompassed some other rights, was celebrated scope and with purposes that none of its throughout the nation, with bonfires and the like. It was a constitutional moment, although there progenitors could ever have envisaged. was still much work for the judiciary to do in developing the writ of habeas corpus. Almost without precedent, five of them applied This is only one, albeit dramatic, example of to a common law court by habeas corpus to how the general words and underlying themes challenge the order of the Privy Council. In an of the Magna Carta were given content over the interlocutory hearing for release on habeas corpus, a course of the centuries. The Charter became weak-kneed court appeared to give credence to the a ‘myth,’ in the sense that it has been invested power to imprison without stated cause. The case with a scope and with purposes that none of its turned on this crucial issue of personal liberty and progenitors could ever have envisaged. It was a on the principle of legality. myth of great historical significance. The prosecution wanted to avoid an express As one of the greatest common law judges of statement that imprisonment was based on our time, the late Tom Bingham, the former Senior a demand for money that had no lawful basis. Law Lord, put it: ‘The significance of Magna Carta Submissions for the knights expressly invoked lay not only in what it actually said but, perhaps the Magna Carta, namely, the general words of to an even greater extent, in what later generations clause 29 preventing imprisonment other than in claimed and believed it had said. Sometimes the accordance with the law. The great lawyer, John myth is more important than the actuality.’ Selden, submitted that ‘the law of the land’ in clause The principle of the rule of law and of due 29 must mean due process as understood by the process inherent in clause 29 of the Magna Carta common law. was developed by incremental steps. What we In response to the failure of the Court to act, came to know as civil liberties or, in earlier centuries the House of Commons drafted what became the as the ‘rights of Englishmen’, were the practical Petition of Right of 1628. Drawing on the Magna manifestations of experience of the law over the
30 POLICY • Vol. 31 No. 2 • Winter 2015 JAMES SPIGELMAN centuries as manifest in judicial decisions and he asserted was an ancient constitutionalism of in legislation. custom extant in England from time immemorial. There is virtually no aspect of the trial process This, like most of Coke’s antiquarianism – for that does not manifest these considerations. example, his espousal of the myth that King Arthur’s Equally important for the protection of liberty are ancestors came from Troy – was and is nonsense. the principles of statutory interpretation. There Nevertheless, the Magna Carta stands in the organic is a strong presumption that Parliament does tradition of the common law. The contemporary not intend to abrogate basic rights, freedoms or human rights movement is based on the alternative immunities. A statute will only be found to do so jurisprudential tradition of natural law. if the language is unambiguous. A few years ago The utility of the Charter is not only historical. I compiled a list of specific circumstances where The proclivity of the executive branch to manifest this presumption has been applied. In my intolerance of anything that frustrates its will was opinion, this list constitutes a ‘Common Law Bill never limited to the Stuarts, either before or since. of Rights.’ An overweening confidence in the purity of their With some support from Parliament these motives appears to be an occupational hazard of protections emerged from a process of induction, executive power. based on experience, rather than deduction from Indeed, Oliver Cromwell rejected constraints an abstract level of language. This was judicial on his authority, dismissing the Magna Carta creativity, before it came to be derided as ‘activism.’ contemptuously as ‘Magna Farta.’ No doubt This characteristic English approach to the even stronger language was used in the White development of the law was frequently in tension House about litigation over Guantanamo Bay. with, and often in competition with, an approach Strong language on such issues it appears is not based on natural law. However many lawyers, unknown in the deliberations of our own including Coke and Blackstone, invoked both. Cabinet! This will not, regrettably, be the last time The 17th century revival of the Magna Carta, led that it is appropriate to celebrate the anniversary by Coke, deployed it as a text which reflected what of the Magna Carta.
POLICY • Vol. 31 No. 2 • Winter 2015 31 FEATURE
MAGNA CARTA: 800 YEARS OF LAW & LIBERTY From Scalia to Jay-Z.
nited States Supreme Court Justice A recent essay by Justin Champion quoted John Antonin Scalia said of the Magna Gray, the liberal philosopher whom I was fortunate Carta, ‘It is with us every day.’1 In its enough to have had as a lecturer at the London 800th anniversary year, it is hard to School of Economics. In Gray’s estimate, the history Udeny this observation. Indeed, a recent New of ideas obeys only one law, that of irony: ‘Ideas Yorker article detailed an entire industry that has have consequences, but rarely those their authors developed in the lead up to the 800th anniversary. expect, and never only those. Quite often they are Magna Carta now has a Twitter username (@ the opposite.’3 MagnaCarta800th) and exhibitions proliferate; The essentially harmless commercialisation ‘the Library of Congress sells a Magna Carta of the Magna Carta is one intriguing example of mug; the National Archives stocks a Magna how the past has affected the present, 800 years Carta kids’ book.’2 on, in a way none of the originators would have On my own recent trip to the British Library, conceived. Imagine what King John and his barons the gift shop was selling Magna Carta T-shirts and would make of a child in 2015, sucking on an tea towels, inkwells, quills, and even King John ‘ORIGINAL 1215 Magna Carta British Library Baby pillows (as a member of the executive government, Pacifier’—a plastic dummy with all 3,500 words I can attest that the pillow does not aid restful of Latin text. sleep). Jay Z, the world’s biggest rap singer, has This evening I simply wanted to offer an entitled his latest album ‘Magna Carta Holy Grail.’ observation about this notion that the Magna Tours of Runnymede are now roaring trade. Carta is with us every day, by a consideration of Whether true or merely apocryphal anecdote, both the trivial and the more foundational ways a story does the rounds: A guide at a recent tour in which this is true. asked for questions, and an American tourist Clearly, the Charter is around us every day asked when the document was signed. The guide in a trivial sense through its said 12.15, upon which the wife of the tourist relentless appropriation for modern turned to him and said, ‘See, I told you we shouldn’t causes. The tea towels, the kids’ have stopped for lunch. We just missed it.’ toys, and the dummies are one In the actual year 1215, the practical purpose form of this appropriation; all for of Magna Carta was that it should operate as a commercial purposes. To anticipate political settlement or, as some have described, as a conclusion to this speech I might a peace treaty by stipulating essential rules for the state here that Jay Z’s album, future conduct of relations between the king and his barons. In this important sense, the document sought to bind the future to the past. Given this The Hon Christian Porter MP was Parliamentary essential feature it is perhaps not unsurprising that Secretary to Prime Minister Tony Abbott when this in its 800th anniversary many questions have been address was delivered at an event of The Centre for posed along the lines of how much the document Independent Studies on 15 June 2015. still actually does, or should, bind the present.
32 POLICY • Vol. 31 No. 2 • Winter 2015 CHRISTIAN PORTER
Magna Carta, interestingly, does not fall neatly into As the historian Paul Johnson noted, ‘to appeal to this crass commercial appropriation category, but Magna Carta became the one, great, unanswerable this is something I will return to shortly. argument which any and every section of society In any event, in my observation, this could employ.’4 And so, as Johnson goes on to commercialisation is perhaps largely benign. describe, Archbishops ‘have flourished it against the However, there is another ‘academic’ way in which King in the defence of the rights of the Church; the Magna Carta is appropriated, which is worthy Edward I flourished it against the Pope in defence of a little more scrutiny. of the rights of the State; Parliament cited it against There is a vast continuum of political ideas the Crown and the Crown against Parliament; in whose service the Magna Carta has been unlettered peasants used it against their masters, appropriated. It seems to start at the very masters against townsfolk, townsfolk against rural broadest level; whereby the Magna Carta has been lords.’ appropriated to advocate on a society-wide scale for The modern habit of arguing that the Magna whole ideologies and for entire classes of peoples. Carta supports the desirability of quite specific At this grand level, the coarsest of summary might changes in niche areas of public policy has gone be to note that the Charter has been adopted by into a sort of hyperdrive in the document’s both conservatives and radicals. The petitions 800th anniversary. One recent example of provision at 61 has been argued as a basis for advocacy appropriation to support a specific and legitimising resistance to the status quo and niche public policy outcome has been with respect encouraging protest to authority, for groups as to judicial appointment. In what could be fairly disparate as the American Tea Party movement to described as a call for radical reform of common the anarchists of the Occupy London movement. law judiciaries, a Member of the English Court Alternatively, conservatives have tended of Appeal, Lady Justice Arden, stated a strong to perceive the document as support for the preference for a judiciary, ‘which is more diverse in maintenance of stable known structures and terms of gender, ethnicity and sexual orientation.’5 procedures of liberal democracy; as supporting an institutional status quo. This divergent ideological It was in part an attempt to put things back use is perhaps not unsurprising because, in some to where they had been, or at least where sense at least, for the barons, their support for the the barons perceived them to have been. Charter was both dissent against the unskilled and calamitous exercise of authority of King John, and so was in this sense radical protestation. But The link between the desired policy outcome and also it was in part an attempt to put things back the Magna Carta was the direct title of the paper to where they had been, or at least where the itself: ‘Magna Carta and the Judges—Realising the barons perceived them to have been. A place where Vision.’ Selection of judges, it was argued, should previous coronation charters had established what be informed by what are described as the ‘traditions were viewed as orderly process-driven relations of the Magna Carta’ to directly address under- between the monarch and the baronetcy. representations in the modern judiciary. Section This type of grand ideological appropriation is 45, stating that justices should be appointed ‘that of genuine academic interest, at least in a historical know the law of the realm and are minded to keep sense, but also in understanding evolutions in the it well,’ was particularly said to require change to history of ideas. However, beneath the ideological be consistent with the vision of the Magna Carta. appropriation has been the sectorial appropriation And the change is, in turn, expressed as the need leading right down to the trend of arguing the ‘to keep the qualities required of judges under Charter as the basis for instituting quite specific review and up to date’ with the new necessary changes in niche areas of public policy. For qualities described as ‘the need for social present purposes I will simply call this ‘advocacy awareness and the need for knowledge of the case appropriation.’ law of courts outside the UK.’
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This is part of an important debate about limits If the argument that more socially aware judges to the role of judges which was highlighted with making broader social decisions is worth serious brilliance by Lord Sumption in his essay ‘The debate, I must confess that the idea that the Limits of the Law.’6 Lord Sumption recognises Magna Carta somehow suggests, supports or should both an inevitability that judges, to some inspire one particular outcome is a considerably extent, necessarily make law in performing their more trivial notion. At worst, it has a slightly interpretative duty, but equally that this process comic quality, reminiscent of mediaeval monks should be rationally limited to avoid what he poring over obscure scripture trying to discern described as a democratic deficit. He outlined a the truth of transubstantiation, and so solve process where the ever increasing creativity of some by creative interpretation of age old scriptures courts in the interpretation of written instruments whether the sacrament is actually Christ’s blood or has had the effect of seeing a greater tendency for merely metaphor. judicial decisions on what are fundamentally, or And I am not alone in perceiving a kind of near at least have traditionally been, economic, social, meaningless interpretative stretch in this type of or political questions. linking of specific provisions of the Magna Carta to the specifics of presently desired niche policy outcomes. An excellent recent essay by historian As a means of illustrating the foundational Nicholas Vincent notes that the problem with this point, it is helpful to return to the interpretative stretch of broad historical words to rap star Jay Z. support specific modern outcomes is that it cuts both ways. He writes:
Lord Sumption characterises the Strasburg Lady Justice Arden’s call, meanwhile, court as having become ‘the international flag for a judiciary no longer drawn from bearer for judge made fundamental law extending the ‘establishment’ but from the liberal well beyond the text which it is charged with majority, seems to me directly to echo applying.’ He takes the view that political or demands in the seventeenth century, economic questions are not changed into legal that judges all be good Protestants, or questions by their being decided by courts and in the eighteenth, that judges not only that something is lost when they are moved from hate the Pope but serve the King. In all the political to the judicial realm. such instances, what is being demanded, Those that ascribe to the view alternative surreptitiously or openly, is discrimination to Lord Sumption’s, which prefer that courts, by the executive intended to interfere with through more activist interpretative methods, have the independence of the judiciary.7 a greater role in determining the best outcome in political, economic or social problems, naturally Perhaps the real difficulty with all the shallow will also argue for selection of judges with more commercial and intellectual appropriation is that ‘social awareness.’ it tends to detract attention from the simpler, Maybe more ‘socially aware’ judges should more foundational importance of the Magna increasingly treat written parliamentary Carta and so obscures what useful modern lessons instruments as ‘living trees’ and should make might be drawn from it. more socially expansive decisions stretching the As a means of illustrating the foundational traditional meanings of the words of the particular point, it is helpful to return to the rap star Jay Z. living tree they are applying. I must say I doubt the His is an appropriation that looks more trivial than wisdom of this point of view, but it is an important it actually is. and meaningful debate, and there are persuasive Jay Z announced the title and release date of points of view on both sides. his twelfth solo album, Magna Carta / Holy Grail,
34 POLICY • Vol. 31 No. 2 • Winter 2015 CHRISTIAN PORTER during Game 5 of the NBA Finals and, as part of the Label’s [sic] have forever taken liberties promotion deal, Samsung agreed to buy 1 million over artists and their dealings with releasing copies of the album that fans would receive for works. The Magna Carta (as you hopefully free via the Magna Carta app. know) was a rewrite of the rules. Jay took A Twittersphere debate emerged as to why the this idea, and implemented it within his album and app were called ‘Magna Carta.’ The early entire roster of artists, hence the internet preponderance of opinion was that, in an industry release, the Samsung hype etc.”8 of rampant egotism, this was simply the next step in the ego wars; that Jay Z was saying he was bigger So Jay Z saw his album as rewriting the than the two biggest things in history. However, commercial rules between labour and capital in this is a misunderstanding. The music itself the music industry. reveals a deep interest in the rules governing the For all the advocacy appropriations pretending relationship between state and citizen. to enlighten us about the importance of the Indeed, an American law lecturer has designed document, which are mostly just pushing a cause, an entire lecture series around the second verse of a blog about a rap artist, in my observation, cuts his song ‘99 Problems.’ I am not going to rap but right to the heart of what is fundamental about the it goes: Magna Carta and what underpins the profound source of its ability to reach 800 years beyond The year is ’94 and in my trunk is raw… its own grave to be all around us today.
And I heard, ‘Son, do you know what I’m Prior to the Magna Carta, a theory of stopping you for?’ sovereign infallibility likely dominated the substantive practice of politics. ’Cause I’m young and I’m black and my hat’s real low? Magna Carta was not the first but, likely, it is Do I look like a mind-reader, sir? I don’t the most historically important re-writing of the know. rules. Previous charters had been designed to deal with the question of what to do when, in practice, Am I under arrest or should I guess some a King was inadequate or downright hopeless, mo’? which in a shockingly violent time was usually revealed by military ineptitude, as was the case I understand that ‘my trunk is raw’ means with King John. Two hundred years earlier King there were drugs in the trunk. The New Jersey Ethelred was only permitted to return to England State Police at the time had an active ‘drug courier on the condition that he signed a document profiling’ program. Here was a sharp criticism promising substantial reforms in his methods of upon the validity of that profiling as a basis for a governance. vehicular stop and its legitimacy as a contributing So, while not the first contract, its historical factor to probable cause (or, in our jurisdiction, importance likely turns on the fact that prior to the reasonable suspicion) required to justify a the Magna Carta, a theory of sovereign infallibility subsequent search. likely dominated the substantive practice The musical digression demonstrates that this of politics. is a man with an acute interest in the interface In a pre–Magna Carta essay, Henry II’s Treasurer between state and citizen. Rather than egomania, wrote: ‘Though abundant riches may often come the better explanation for the name of the album to Kings, not by some well attested rights … [but] is provided by this blogging response: even by arbitrary decisions made at their pleasure, yet their deeds must not be discussed or condemned It means: To rewrite the rules. by their inferiors.’9
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Arguably, Magna Carta is the pivot point at in 1215. Least of all is the point whether the which the contract theory of the state ends the negotiation produced words that can now provide dominance of this type of thinking and becomes guidance or clues or inspiration for how we solve a replacement paradigm for society’s conception specific modern controversies around the evolving of its relationship with sovereign power. The relationship between state and citizen in 2015. process and outcome of the events in Runnymede The power of the Magna Carta to effect and uncannily mirror three central elements of what inform the modern is not in the result of the 1215 political philosophers now would call the contract negotiation, but in the fact of the negotiation itself. theory of the state: If the Charter’s fundamental importance is in constituting a pivot point in the history of ideas, • The relationship between citizen and state this means there is perhaps more to be learned by should be conducted according to known and consideration of how the document came to be knowable rules to which everyone is subject; than what was in it. And so, a few observations about the negotiation process. • the rules are a form of fundamental bargain or The actual five days at Runnymede are rather contract between the citizens and the state to unclear. In fact, the one historical point that is whom citizens cede the monopoly power of perhaps now clear is how unclear it must have compulsion (which was in the first instance been to the many participants as to what precisely their own); and was going on. There were things of great importance to the parties that went in, and things of equal • the rules can and are to be rewritten from importance got left out. time to time and from issue to issue, with the The whole point for the Northern barons critical proviso that rewriting must only be (after John’s disastrous continental forays) was a the product of agreement in what becomes ‘limitation on overseas service clause.’10 Conceded a never ending process of negotiation, in a preliminary draft, this was left out of the final compromise, and bargain. document and many barons left in disgust before the document was even signed. Perhaps the overwhelming identifying feature The power of the Magna Carta to effect of the process that led to the Magna Carta was and inform the modern is not in the result of that it was a colossal mess. In 2013 a new word the 1215 negotiation, but in the fact of the entered the Oxford English Dictionary. This word negotiation itself. gained popularity in political circles to describe the general process of modern government in formulating policy. The word was ‘omni- Barons for and against the King, each with shambles.’ It took 800 years to invent the perfect intermediaries lay and clerical; landowners for and word to describe what happens in the democratic against the King; Church parties for and against negotiation processes designed to produce the King; and the Pope, represented by his legate, workable compromise in public policy outcomes— sought to influence all those present—both those but this is it. for and against special legal protection for the To give you some modern perspective, likely Catholic Church and the aristocracy; tax breaks for the process at Runnymede was so messy it may the wealthiest; freeing capital cities from regulatory have even made Kevin Rudd’s 2020 summit look oversight; total freedom of elite immigration; and well-organised. Believe me, I experienced two days placing the burden of infrastructure maintenance of the Wayne Swan tax summit—two days of my on local communities instead of government. life I will never get back. The most important point is not whether The historian Paul Johnson argues that so eclectic the outcome of negotiation produced a sound and failed a compromise was the document itself blueprint for the good governance of the England that had John not got in first to repudiate it, likely
36 POLICY • Vol. 31 No. 2 • Winter 2015 CHRISTIAN PORTER the barons would have denounced it in their turn. looking to the Magna Carta for guidance as to the He described the result as: appropriateness of offender profiling as a basis for vehicular searches or the optimal role for judges a spatchcocked compromise which did and the optimal method for selecting the judiciary, not represent the attitudes of any of the then the charter is much less clear. parties—or rather represented bits of all of them—and was therefore unworkable as a The negotiation has been an amazing political settlement. The story of the Magna success in providing a blueprint for how Carta, in fact, is not of a negotiation which succeeded but one that failed.11 to create governance blueprints.
We know the king repudiates the document Recourse to phrases such as that imprisonment a month after Runnymede when he realises the will require ‘lawful judgment of his Peers or by barons mean to enforce the ‘security clause.’ the Law of the land,’ or that Justices should be As an aside, in modern politics we hear a lot of appointed who ‘know the law of the realm and are claims of sovereign risk. King John’s repudiation of minded to keep it,’ in truth is not terribly helpful the fundamental contract of governance negotiated in determining what specific rules are agreeably only a month before always reminds me of Paul consistent with the concepts of fair conduct in the Hogan’s great line, ‘That’s not a knife,this is a knife.’ justice system in 2015. I like to think of King John lying his head on his The messy process of contractual governance King John pillow thinking, before repudiation, leads to government practices and governance ‘That’s not sovereign risk,this is sovereign risk.’ documents that tend to be better at getting So, Magna Carta may have been a negotiation consensus around specifics for weights and that failed to provide a governance blueprint for measures than consensus around specifics for really immediate use in 1215. But the negotiation has important issues. been an amazing success in providing a blueprint Contractual government seems to be like a good for how to create governance blueprints. academic: finding it much easier to get more and If Runnymede was a bit of an omnishambles, the more specific about less and less. mess is nevertheless marked by two serious virtues But this is so only because modern governance that made it historically significant. First, unlike the reflects the features of people governed. It Rudd 2020 summit, it actually produces a result; reflects that the contract of governance is a messy something tangible, readable and knowable, if compromise required to build a political consensus not always clear. And second, it produces a result between different interests with different views, capable of evolution by further negotiation; the where everyone ends up dissatisfied to some extent rules get rewritten and reissued multiple times by with the end result. the next generations of sovereigns by variants on A great lesson, as true today as it was the same messy process. 800 years ago, is that a primary feature of Finally and by way of conclusion, there is contractual government is that we can all agree another feature of the negotiation process that has with a fairly high level of consensus on the little implications for modern governance. As well as things like weights and measures but equally being shambolic, the process produces a document rational people will often fail to agree with detail which in many respects is quite vague—mostly and precision on big things. So foundational about the important stuff. documentary agreement occurs at the level of If we were still bartering for haberject, then greatest generality and the details of general the Magna Carta’s feudal fastidiousness in principle are the subject of ongoing negotiations standardising measures for this hemp-like and determinations. substance would see us knowing exactly what to Issues like judicial roles and selection and do in 2015 in the haberject market. But if we are offender profiling are contestable and the way
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in which we resolve these contested issues will Endnotes not likely be aided much, if at all, by recourse to 1 In his opening of the 2014 National Lawyers Convention the words of the Magna Carta. But they can be on 13 November at the Mayflower Hotel in Washington, DC, in a discussion of the importance of Magna Carta. resolved by recourse to and an understanding of the 2 Jill Lepore, ‘The Rule of History: Magna Carta, the Bill processes that underpinned the Magna Carta. of Rights, and the hold of time.’ The New Yorker, A government could certainly choose now to 20 April 2015. stand for policies that are at least arguably clear in 3 John Gray, ‘The Original Modernizers.’ Gray’s the words of the Magna Carta. However, such a Anatomy (2009), p. 263–274, 263. party would be taking what Sir Humphry would 4 Paul Johnson, The Offshore Islanders: A History of the English People (Phoenix, 1995), p. 122. describe as a ‘courageous decision.’ 5 The Right Honorable Lady Justice Arden DBE, ‘Magna But if, as John Gray argues, ideas have Carta and the Judges—Realising the Vision,’ p. 16. Available consequences that rarely reflect what their authors at https://www.royalholloway.ac.uk/aboutus/documents/ expect, perhaps one exception is the Magna Carta. pdf/magnacarta/magnacarta8711.pdf. This is because, in one sense, its legacy is exactly 6 Available at https://www.supremecourt.uk/docs/ speech-131120.pdf. what was expected by the barons in 1215: that 7 Nicholas Vincent, ‘Comment on Justin Champion.’ contentious issues can be resolved, but only after Available at the Online Library of Liberty, http://oll. the thrashing out, the debating, the subjecting to libertyfund.org/pages/libertymatters-mc. argument and re-litigation and revision, and even 8 Available at Yahoo! Answers, https://answers.yahoo.com/ then imperfectly, in the messy real world process question/index?qid=20130702070656AA5Xiim. of politics. 9 Quoted in Johnson, p. 118. 10 ibid., p. 121. 11 ibid., p. 121.
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38 POLICY • Vol. 31 No. 2 • Winter 2015 ARTICLES
FREE TRADE & ITS EXCEPTIONS
Do they apply to Australia today?
conomists have long known that free The idea that public policy should be trade is good—all trade, not just ‘fair’ organised to protect and advance the trade. Indeed, Paul Samuelson described interests of exporters has no support in the theory of comparative advantage as economics. being both trivial and true. Writing in the early Eth 19 century David Ricardo argued: And yet, in Australia today, 238 years after the publication of The Wealth of Nations, the Foreign trade [is] highly beneficial to a dominant economic narrative goes like this: country, as it increases the amount and reforms that enhance productivity and cut variety of the objects on which revenue may costs build international competitiveness; be expended, and affords, by the abundance international competitiveness drives and cheapness of commodities, incentives exports; exports drive growth; growth drives to saving, and to the accumulation of jobs; and jobs support living standards. 4 capital…1 To be clear, Henry’s argument is not that While in the late 18th century Adam Smith had government shouldn’t pursue a reform agenda but taught that prosperity merely required ‘peace, easy rather that ‘Australian mercantilism’ is not good taxes, and a tolerable administration of justice.’2 economic policy. Of course, there is more to industry No role for government there in inhibiting, or policy than mere mercantilism, but the overall promoting, foreign trade. The short answer then criticism against activist government intervention in to the question of whether Australia should worry the economy applies to both policies. about free trade is ‘No.’ Nevertheless there are often arguments that For many, however, that short answer is going to suggest that free trade results in be unsatisfactory. After all, Smith and Ricardo were the loss of domestic employment writing at the dawn of the Industrial Revolution. opportunities. Current concerns With the passage of time there may well have about the proposed free trade emerged a good reason not only to protect local agreement with China, for example, industry from free trade, but for Australia to revolve around whether Australian actively pursue industry policy. employment will be enhanced by the As John Burton explains industry policy usually agreement. Overall manufacturing has one of two objectives; first to accelerate the ‘birth rate of new business ventures’ and second, ‘thwarting, decelerating, or reversing the process Sinclair Davidson is Professor of Institutional of economic natural selection.’3 Economics, RMIT University, and a senior research There are powerful arguments in Australia for fellow at the Institute of Public Affairs. An earlier version industry policy—especially as it relates to trade. As of this paper was presented at the 2014 Australian Ken Henry explained to the Crawford School of Political Studies Association conference held in Sydney. Public Policy in 2014:
POLICY • Vol. 31 No. 2 • Winter 2015 39 FREE TRADE & ITS EXCEPTIONS
employment has declined in Australia since tariffs This is an industry that has enormous were reformed in the 1970s. In the next section effect whether from plastics to steel to I explore whether a case against free trade and aerospace. I mean, it is not just building in favour of industry policy can be made in the motor cars here. It is having the capacity Australian context. to build jet fighters and therefore it is incredibly important that we keep the Is Australia a Special Case? skills base. It is theoretically possible that some or other market distortion or market failure exists requiring Former opposition leader Tony Abbott has government intervention that could result in an made a similar argument, but with an important improvement in economic prosperity. The challenge qualifier (emphasis added): for those wishing to pursue this line of argument is in identifying the market distortion or market If a respectable case can be made for failure that would give rise to such a circumstance. maintaining a heavy manufacturing base Economists have identified several such possibilities: on the grounds of national security, the inherent value of a diversified economy • National security or the transitional costs of shutting down • Infant industries capital-intensive industries only to start • Lack of a level playing field (anti-dumping) them up again when market conditions • Strategic trade theory change, there needs to be a forum where • Job creation it can be addressed.6
It is not clear, however, that the ‘respectable It is not at all clear that the skills case’ for national security has been made—certainly associated with assembly line production of not in the case of manufacturing. It is not at all automobiles will assist in the manufacture clear that the skills associated with assembly line production of automobiles will assist in the of jet fighters, especially at short notice. manufacture of jet fighters, especially at short notice. In his 1848 classic work John Stuart Mill National security must be one of the strongest argued there was only one instance where arguments for government intervention in the industry policy could be justified—an argument economy. National security is a pure public good in we now label the ‘infant industry argument.’7 He that it is both non-rival and non-excludable. Almost suggested that there might be instances where an every economist agrees that government should economy could develop a comparative advantage both finance and provide national security. The in the production of a good, but that the industry question of interest relates to weapons procurement would temporarily be at a disadvantage to some policy. To what extent should government buy other economy that had benefitted from earlier weapons from local industry as opposed to buying development. It is important to emphasise, weapons in international markets or through a however, that Mill suggests the notion as a possibility competitive tender process? To the extent that and is tentative as to its efficacy. He does emphasise government wishes to buy local weapon systems, that any protection be temporary and that the or maintain the capacity to produce weapon industry must become successful without the need systems locally, then there is an argument to for protection. Charles Francis Bastable, however, providing some protection to (some) local industry. argued that simply becoming successful isn’t In 2008 former Industry Minister Senator Kim enough of a test—he argues that the appropriately Carr made this sort of argument justifying discounted benefits must exceed the total costs of protection of the automobile industry:5 protection.8 He suggested that few industries will
40 POLICY • Vol. 31 No. 2 • Winter 2015 SINCLAIR DAVIDSON ever meet such a test. Renewable energy provides consumers from buying goods and services at an example of an infant industry. lower prices. Arguments for a ‘level playing field’ The mandatory renewable energy target was invariably involve conspiracy theories. More first introduced in 2001 and subsequently importantly, however, the theory of comparative modified. At present it has a target of replacing advantage proposed by Ricardo does not rely on a 20% of Australian electricity use by 2020. In 2014 level playing field; quite the contrary, it relies on the Abbott government announced a review of the different economies being different, and having renewable energy target prompting some within different opportunity costs. the industry to argue that a reduced renewable Australia was the second country in the world to energy target would reduce investment in the adopt anti-dumping provisions in 1906 following industry. For example, the Australian manager after Canada in 1904. The Australian government of FRV, Andrea Fontana, told the Australian has more recently established the Anti-Dumping Broadcasting Corporation that $3 billion of future Commission to ensure that Australian industry project work would be withdrawn.9 In the absence does not suffer ‘material injury’ as a consequence of industry policy (in the form of the renewable of goods being ‘dumped’ in Australia below their energy target) those projects would not be ‘normal value.’12 economically viable. By contrast, the head of the government review, Dick Warburton argued It is unclear from an economic perspective that while the renewable energy target policy had if any harm comes to consumers from had the effect to encourage business entry and buying goods and services at lower prices. investment into the renewable energy sector, that was not the actual policy intent. Others have argued that a reduction in government subsidy to There is a massive economics literature that renewable energy sources will lead to massive job characterises anti-dumping provisions being losses and investment losses on capital projects economically protectionist and constituting rent- already undertaken.10 seeking behaviour.13 George Stigler argued that The particular example of the infant industry interest groups (notably industry) seek out regulation policy highlights a number of issues. Most obviously in order to restrict competition by creating barriers the lack of financial sustainability is a problem— to entry. Anti-dumping precisely fits this regulatory without ongoing government intervention many theory.14 As Maurizio Zanardi explains: within the industry cannot survive. Then if and when government tries to unwind previous industry …one may say that the theoretical analysis policy, the capital losses are likely to give rise the concludes that there are few instances in claims of sovereign risk while job losses create which [anti-dumping] is supported by political risk for politicians. sound economic motives (i.e., perhaps in The classic economic argument in favour of the case of predatory dumping). Given free trade is predicated on Ricardo’s theory of that the empirical occurrence of these comparative advantage. But it is ‘well-known’ that cases is rare … the general presumption foreigners ‘cheat’—either by having lower cost is that [anti-dumping] is nowadays used structures or by having their governments provide to the advantage of industrial interests, some sort of subsidy to their trade (see Bryan with negative impacts on both consumers’ Caplan for a discussion of so-called anti-foreign welfare and competition. 15 bias).11 This lack of ‘level playing field’ is a popular argument for domestic intervention, in particular From a public choice perspective, however, for so-called ‘anti-dumping’ policies. anti-dumping policy is likely to be popular with To be sure, all this creates employment for both the general public (anti-foreign bias) and economists and lawyers, yet it is unclear from policy-makers. In addition to industry lobbying an economic perspective if any harm comes to government this policy also generates employment
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opportunities for domestic regulators. While and development, or in government production George Stigler recognised that industry groups in selected infant industries. It is this type of logic were likely to engage in rent-seeking behaviour, it is that underpinned the 2014 Business Council of now widely recognised that the bureaucracy within Australia report, Building Australia’s Comparative government itself is likely to engage in rent-seeking Advantages, that argued for ‘a more thoughtful role behaviour too.16 It is these considerations that are for government in facilitating and coordinating likely to explain the (international) growth in anti- economic development.’20 The difficulty with dumping policies despite economic analyses finding this approach is that government remains poor at that anti-dumping policies are ‘(almost always) ‘picking winners.’ Indeed, the ACCC chairman Rod welfare reducing.’17 According to Bruce Blonigen Sims was quoted in the Australian Financial Review and Thomas Prusa:18 making that very criticism against the Business Council of Australia proposal.21 [Anti-dumping] no longer has anything to do with predatory pricing. Even more to the Picking Winners point, all but [anti-dumping]’s staunchest At this point I want to digress and discuss the supporters agree that [anti-dumping] has ‘picking winners’ argument in a bit more detail. nothing to do with keeping trade “fair.” It is often suggested that east Asian economies [Anti-dumping] has nothing to do with developed by having government pick winners. moral right or wrong, it is simply another The implication being that some governments, at tool to improve the competitive position of least, have been able to successfully pick winners the complainant against other companies. and that Australia could and should emulate their efforts. Although now somewhat dated, the 1993 World Bank report into ‘the east Asian miracle’ That may be a good political argument remains a definitive guide for those who want to but it is not a good economic argument. pursue this argument.22 The World Bank provides four suggested policy explanations for high levels of economic growth in the east Asian region. Some observers argue, however, that anti- First a ‘neo-classical,’ or neo-liberal, explanation dumping policy should not be considered from the where government simply allowed markets to perspective of harm to consumers, but rather from operate. Second, a ‘revisionist’ approach where the perspective of harm being done to producers government did make an attempt to pick winners and so, in the long run, to the economy. That and in retrospect were apparently successful in may be a good political argument—and as shown doing so. The market-friendly approach suggests above that is the protectionist argument actually that government acted only in those areas where employed—but it is not a good economic argument. markets could not or would not operate well. In the absence of predatory pricing it is difficult to Finally, the World Bank concedes that there may understand how high cost producers being replaced not be a single or simple policy recipe for economic by lower cost producers, albeit they are foreigners, prosperity and suggests that there might be can inflict long-term damage to the economy. ‘multiple paths to growth.’ Some might argue that comparative advantage It is those economies said to have followed does a poor job in explaining observed trade the ‘revisionist approach’ that are of particular patterns, and a different theory might explain interest here. Japan, South Korea, and Taiwan why we observe many economies producing saw substantial intervention in the economy with similar goods and services, and trading those good government pursuing a range of interventions that and services. The so-called strategic trade theory promoted economic growth and activity. In those pioneered by Paul Krugman, for example, performs three economies it appears that government was such a function.19 That approach invites policy able to pick winners. By contrast, however, Paul intervention in the form of subsidising research Krugman argued that these governments didn’t
42 POLICY • Vol. 31 No. 2 • Winter 2015 SINCLAIR DAVIDSON pick winners so much as mobilise resources.23 a manufacturing job as opposed to having the As he suggests government-mandated resource ‘right’ to work at a job. In addition, it is unclear mobilisation is much easier in those economies why the government should intervene to create or with fewer civil liberties than voters are prepared to subsidise low-skilled employment opportunities in accept in ‘western’ economies. a society where education is both compulsory and Ultimately the evidence in favour of picking free at point of sale. According to Australian Bureau winners is confused with the ability of some of Statistics data all levels of government spent governments to mobilise and direct resources to $79.6 billion on education in 2012–13.26 There particular ends. is no reason why Australian educated individuals This brings us to one of the more powerful and should have to work at low-skilled jobs. populist arguments for intervention: job creation. The argument being that government should intervene in the economy to ensure that employment Both the participation rate and the opportunities are either created or maintained in employment to population ratio have particular industries or even particular segments of increased over time. the population. This intervention goes beyond anti- discrimination policies to areas such as providing employment for, say, low-skilled workers, or to As can be gleaned from this discussion there individuals in particular regions, and the like. are many apparently good, yet superficial, reasons In 2014 and 2015 this argument manifested for government to intervene in the economy and itself in the choice between producing submarines protect domestic industry. None of those reasons locally (and creating employment opportunities survive close scrutiny—even in the case of national in South Australia) or buying them from either defence where there is a clear role for government. the Germans or Japanese. The South Australian While government should finance national defence government openly lobbied the Federal government it is not the case that all defence material should on this basis with acting South Australian Minister be domestically produced. In addition there is no for Defence Susan Close saying, ‘What we need is a unique Australian characteristic that interacts with government that is prepared to invest in Australian any of these arguments that suggests a unique and South Australian jobs, invest in the technology reason for government intervention in Australia. we have here and not contemplate spending money overseas’.24 By contrast, in 2014, Prime Minister Conclusion Tony Abbott was arguing, ‘We should make a In recent years the challenges facing the Australian decision here based on defence requirements, not economy have related to foreign recessions and on the basis of industry policy based on regional Internet driven creative destruction. It is unclear policy.’ how industry policy could respond to, or resolve, While it is true that manufacturing jobs those challenges. Consider the examples I have in Australia have declined as a proportion highlighted. A policy predicated on inhibiting of all employment, it is not the case that the exit in the case of the automobile manufacturing economy cannot or has not created employment industry can be justified on national security opportunities. Both the participation rate and the grounds. Yet that policy failed to maintain a viable employment to population ratio have increased industry within Australia. A policy that had the over time. According to the Australian Bureau of effect of attracting business entry and investment Statistics the participation rate has increased from into an infant industry cannot even be reviewed about 60% in the late 1970s to 65.1% now.25 without fear of job losses and invoking sovereign Similarly the employment to population ratio has risk. Anti-dumping policy is now widely seen by increased from 57% to 61%. What has decreased economists as being a form of protectionism rather is the proportion of manufacturing jobs, yet it is than a mechanism to prevent predatory pricing not clear that Australians should have a ‘right’ to in international markets. Regional examples of
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9 Sabra Lane, ‘Australian Renewable Energy Agency head Greg apparently successful industry policy are more likely Bourne says scrapping RET would destroy industry’, ABC News, to reflect resource mobilisation rather than good 5 September 2014. policy itself. 10 Alexander White, ‘Australia needs the renewable energy target Economists tend not to favour industry policy. (and should increase it),’ The Guardian, 18 August 2014. 11 Bryan Caplan, The Myth of the Rational Voter: Why Democracies There is no reason to deviate from that position. Choose Bad Policies, Princeton, NJ: Princeton University These observations, however, do not preclude Press (2007). any role for the state. In an environment of high 12 Anti-Dumping Commission, undated, ‘Factsheet - Australia’s anti-dumping system,’ About us, http://www.adcommission. levels of creative destruction many businesses gov.au. will struggle, and even fail. Having effective and 13 See Bruce Blonigen and Thomas Prusa, ‘Antidumping,’ in E.K. efficient bankruptcy procedures will ensure that Choi and J. Harrigan (eds.), Handbook of International Trade, resources are quickly reallocated from failed to Blackwell Publishers (2003), and Douglas Nelson, ‘The political economy of antidumping: A survey,’ European Journal of Political successful businesses. Ensuring that business Economy, 22 (2006), 554–590, for extensive survey discussions. regulation is minimised will also ensure that 14 George Stigler, ‘The theory of economic regulation,’ Bell Journal entrepreneurs can focus on their profitability of Economics and Management Science, 2 (1971), 1 – 21. and business models and not needlessly engage 15 Maurizio Zanardi, ‘Antidumping: A problem in international trade,’ European Journal of Political Economy, 22 (2006), 591 – in compliance. Simultaneously, recognise that 617, pg. 592. the Australian education system provides ample 16 See, for example, Gordon Tullock, Bureaucracy, Liberty Fund opportunity for individuals to train and retrain (2005/1965); William Niskanen, Bureaucracy and Representative Government, Aldine-Atherton (1971); Mwangi Kimenyi, for productive employment. In short, the role ‘Bureaucratic rents and political institutions,’ Journal of Public of the government is to pursue the tolerable Finance and Public Choice, 3 (1987), 189–199; Fred McChesney, administration of justice and easy taxes that Adam ‘Rent extracton and rent creation in the economic theory of regulation,’ Journal of Legal Studies (1987), 101–118; John Mbaku, Smith spoke of over 200 years ago. ‘Military expenditures and bureaucratic competition for rents,’ Public Choice, 71 (1991), 19–31; and Kevin Murphy, Andrei Shleifer, and Robert Vishny, ‘Why is rent-seeking so costly to Endnotes growth?,’ American Economic Review, 83 (1997), 409–414. 17 Zanardi, as above. 1 David Ricardo, On the Principles of Political Economy and Taxation, Third edition, London: John Murray (1821). 18 Blonigen and Prusa, as above, pg. 253. Available at http://www.econlib.org/library/Ricardo/ricP.html. 19 Paul Krugman, ‘Increasing returns, monopolistic competition, and 2 Adam Smith, On the nature and causes of the wealth of nations, international trade,’ Journal of International Economics, 9 (1979), Chicago: University of Chicago Press (1976/1776). 469 – 479. 3 John Burton, Picking losers? The political economy of industrial 20 Business Council of Australia, Building Australia’s Comparative policy, The Institute of Economic Affairs (1983), pg. 29. Advantages (2014). Available from http://www.bca.com.au/ newsroom/actions-needed-to-build-australias-comparative- 4 Ken Henry, ‘Public policy resilience and the reform narrative,’ advantages. address to the Crawford School of Public Policy (2014). Available at https://crawford.anu.edu.au/sites/default/files/news/ 21 Jacob Greber, Fleur Anderson and Luke Malpass, ‘Sims asks BCA files/2014-09/ken_henry_-_public_policy_and_the_reform_ to please explain picking winners,’ Australian Financial Review, 30 narrative_.pdf. June 2014. 5 Alexander Kirk, ‘Carr hopes hybrid plan will stem job losses’, 22 The World Bank, The East Asian Miracle: Economic Growth and ABC The World Today, 10 June 2008. Public Policy, Oxford University Press (1993). 6 Ben Packham and Lanai Vasek, ‘Tony Abbott suggests ‘national 23 Paul Krugman, ‘The myth of Asia’s miracle,’ Foreign Affairs 73:6 security’ may be a reason for manufacturing assistance,’ The (November/December 1994), 62–78. Australian, 29 August 2011. 24 ‘Submarine policy: Nick Xenophon urges PM to “end the 7 John Stuart Mill, Principles of political economy with some of their uncertainty” over SA project,’ ABC News, 8 September 2014. applications to social philosophy, London: Longmans, Green and 25 Australian Bureau of Statistics, Labour force Australia, Cat. 6202.0, Co. (1848). Available at http://oll.libertyfund.org/titles/mill- Canberra (July 2015). principles-of-political-economy-ashley-ed. 26 Australian Bureau of Statistics, Government finance statistics 8 Charles Francis Bastable, The commerce of nations, Eighth education 2012-13, Cat. 5518.0.55.001, Canberra (2014). edition, London: Methuen and Co. (1917/1891).
44 POLICY • Vol. 31 No. 2 • Winter 2015 ARTICLES
HOW IDEAS SPREAD
One CIS report’s 20-year journey around the globe.
hink tanks and university research politics, I spoke about the merits of a free economy. departments develop and promulgate When I discovered how little young Australians and ideas and policy concepts whose impacts New Zealanders, including most tertiary economics are normally hard to document and students, knew about fundamental economic Tassess. Given sufficient time, we may of course be concepts—such as competition, entrepreneurship, able to evaluate the relevance of ideas, for example transaction costs, principal-agent problems, and Aristotle’s teachings at his Athens think tank, rent-seeking—I decided to pen an introductory the Lyceum. We may by now even have a good didactic text to define these concepts and outline idea of the influence of Charles Darwin’s insights which attitudes, customs, and laws facilitated the into evolution. When competing new ideas are discovery and testing of useful knowledge. The incorporated in goods and services, which are text drew on the now widely accepted teachings bought in markets, sales figures soon reveal how of modern Austrian economics, most notably they are received. But there are no sales figures for by Friedrich A. Hayek, as well as contemporary the output of ‘idea factories,’ which generate and public-choice theory and the insights about capitalist distribute inspiring policy concepts. In today’s dynamics of the great Austrian-American economist cacophonic competition of ideas, short-term Joseph A. Schumpeter. I distinguished between the impacts of useful ideas are therefore much harder to orthodox way of economic thinking (neoclassical document and evaluate. Press reports and mentions economics), whose focus is on rationing and on the internet may serve as a partial substitute, allotting known scarce resources to satisfy known but this information is unreliable when it comes wants (maximisation), and Austrian economics, to assessing which ideas have become catalysts which focuses on ignorance, discovery, and the that triggered actual policy decisions. widening of mankind’s material opportunities. This is why it would seem useful to report a Like any writing on political economy, my text case study about which I have detailed information. had to touch on philosophy, economic history, When I joined the Centre for Independent Studies in jurisprudence, sociology and public policy. My 1998, I was involved in purpose was not to write yet its ‘Liberty and Society’ another academic textbook, but programme. Once or to provide an easily accessible twice a year, gifted, introduction to the rules of the interested tertiary free-market game and on how students are invited to the right rules promote material a weekend of seminars well-being for the general and brainstorming to explore the foundations of a free Wolfgang Kasper is professor of economics emeritus at society. Alongside the University of New South Wales. He is greatly obliged lecturers in philosophy, to Mrs. Linda Whetstone, London, for corrections and jurisprudence and comments on an earlier draft.
POLICY • Vol. 31 No. 2 • Winter 2015 45 HOW IDEAS SPREAD
student, journalist, aspiring politician and layman. These international editions owed much to The CIS published this 150-page booklet in 1998.* the energetic engagement of the London-based To my surprise, I was soon approached by a Network for a Free Society and its energetic professor of economics from Ankara: Could he spiritus rector, Linda Whetstone. She and her translate the booklet into Turkish, and would it be collaborators incorporated updated versions of possible to apply what was said more explicitly to my piece in a major compilation of key texts that the question of economic development? At about may inspire classical liberal thinking, which they the same time, a young Nigerian contacted me then put on a CD. This venture was the result of suggesting a version that had more to say about the deplorable fact that all too many regimes still the economic development of poor countries and, censor the imports of books that may not be to the above all, the consequences of political corruption; liking of their rulers. Moreover, young academics, and the head of a liberal think tank in New Delhi journalists, and critical thinkers in poor countries proposed to publish my text both in English and do not find the relevant books and journals in their a Hindi translation. The text thus metamorphosed national or local libraries, nor do they have the into a discussion of economic development and means to buy the best-known books about classical necessary changes in cultural and institutional liberalism, which inspired us in the more affluent conditions. I tailored different forewords for these countries when we were young. Poor download various editions. Although I had only limited speeds in Third World countries also make it often knowledge of the three countries where these impossible to obtain copies of relevant texts over ‘reincarnations’ of the original CIS publication the internet. But almost everybody now has access were to appear, I supplemented the text with to a computer on which to read a CD. country-specific examples to underline key points With the help of generous donors, the CD Ideas and inserted country- or region-specific data. In for a Free Society now makes over one-hundred each case, the CIS willingly granted copyright essays by (mostly dead) economists and other permission. classical liberal thinkers accessible to people around the world. My text on Economic Freedom and Development thus now travels in the company of the Greats— Aristotle, John Locke, David Hume, Adam Smith, Alexis de Tocqueville, Frédéric Bastiat, Friedrich Hayek, Karl Popper, Milton Friedman, Subsequently, I was pleased to learn that these Peter Bauer—and a booklets are used in quite a few introductory number of eminent economics courses. Over the years, I have contemporary writers. been receiving occasional e-mails from readers Internally amongst us, with criticisms, comments, and compliments. we call it the ‘Eureka A journalist may send me an article in which he CD,’ because so many quoted me; another submits interview questions readers tell us that they have found eye-opening about topics related to the institutions of and inspiring material there. About 130,000 copies capitalism, as discussed in the booklet. have by now been distributed in some 70 countries,
* Property Rights and Competition –– An Essay on the Constitution of Capitalism, Policy Monograph 41 (Sydney: Centre for Independent Studies).
46 POLICY • Vol. 31 No. 2 • Winter 2015 WOLFGANG KASPER mostly through local think tanks and university exactly these cultural obstacles that made the departments. The CDs are often re-copied and read promulgation of Austrian economics throughout by more than one reader. Some countries, such as the Arab world necessary. And a reader e-mailed Armenia, may still ban the import of those CDs, me from Oman: “You do not know how wrong but it seems that copies of the texts have nevertheless you are; and you do not know how right you are!” slipped through the customs nets. (It turned out he was a sufi, a Muslim mystic.) In Probably because I am still amongst the living, 2014, a Moroccan think tank published an edited I am sent occasional feedback from readers in version of this Arabic text and is now preparing a great many countries. Quite a few tell me that a book publication. The Economic Freedom and many of the concepts, which I defined and Development paper will also form part of a selection which are reasonably well understood in Western of pieces from the original English CD on an countries, are not known at all where they live and Arabic CD that will soon be disseminated in North work. It is hard for teachers or journalists to argue Africa and the Middle East. A Farsi version is now about pressing economic issues, when terms like being prepared for distribution over the internet, ‘entrepreneur,’ ‘private property,’ or ‘business’ do and a hard copy will soon go on sale within Iran. not exist in their mother tongue, or when a term like I also had the biznes is tainted with connotations of corruption, pleasure of meeting a as is the case in Russian. Several interested writers young academic from have therefore approached me and the CIS for Kyrgyzstan, who was the right to translate my little text into foreign involved with driving a languages. A CD with translations of the main ‘Freedom Bus’ around texts into Russian (including the Economic Freedom Central Asia. He and Development essay) was launched in Moscow proudly told me that by the Adam Smith Forum in November 2011. he had used my piece In 2011, I also in Russian translation (of which I had no inkling collaborated with an at the time) when talking to university staff and Iraqi, now living in students. England, to prepare an In early 2013, my piece also appeared in French Arabic edition. I took translation on a CD, Idées pour une société libre, the liberty of penning which contains the writings of some classical French a foreword, in which I liberals alongside translations of many of the texts dwelled on particular on the original English ‘Eureka CD.’ In 2015, the difficulties that, in Institut Coppett, a Paris-based liberal think tank, is my opinion, Muslim launching a ‘digital university,’ L’école de la liberté, believers have with which will promulgate the arguments of free-market modern capitalism, advocates through videos of public lectures and a stemming from deeply cyber library, including my Liberté économique held cultural beliefs et développement. about men and women, private property, tolerance, After the Network for a Free Society had trust in complete strangers, the secular state, and bankrolled a Chinese translation of materials on the inevitable evolution of habits and laws. The the ‘Eureka CD,’ the Chongqing Publishing Mideastern commercial culture, which developed House, in cooperation with the Cathay Institute institutions that so effectively facilitate personal of Public Affairs in Beijing, published a book, trade and middlemen networks in bazaars, struggles containing amongst other texts Economic Freedom to adopt the rules that underpin impersonal and Development. The same group also incorporated exchanges and cooperation with strangers. Instead a few other articles I had written for the CIS in of receiving a reply that such views of a foreigner other books about capitalism. When I met some were unduly provocative, I was told that it was young economists from China, I was pleased to
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note that these free-market ideas, which may not in documenting what waves around the globe always be welcomed by higher authorities, are think tanks are making, I shall risk being criticised. eagerly absorbed by critical minds in the next It seems important to me to spread a genuine generation. understanding of Austrian economics, public A few years back I learned that the original CIS choice, and capitalist dynamics. This is essential to publication was being used in economics courses understanding the modern knowledge economy, at Guatemala’s Universidad Francisco Marroquín in which the bulk of what is produced consists of (UFM). I was told that some students were struggling diverse, often tailor-made services. By contrast, with the English; I therefore suggested a Spanish conventional neoclassical economics—which still translation. Meantime, I have completely rewritten dominates university courses and the traditional the original text in Spanish, incorporating material economics journals in the developed countries— on Latin America, may have something to say relying on an eager about a stationary world of young lecturer at UFM agriculture and industrial to correct and polish my mass production. But this inelegant Spanish. With brand of economics fails luck, this version will to properly inform the soon be published in political discussions about hard copy as well as in an economic reforms, such as electronic version. liberalising markets and Further afield, the shifting property rights spread of wave rings from from public into private the stone I threw with ownership. Because the 1998 CIS booklet Austrian economics are becoming harder to focuses on cultural and discern. There seem to economic evolution, it is be a number of other now increasingly embraced editions and translations, by analysts and policy which I have not seen. makers in the developing Thus, a think tank in world. When traditional Islamabad in Pakistan stationary societies are is rumoured to have swept up in the turbulence published an edition, and of modernisation, a young academic from Austrian ways of economic Maputo in Mozambique thinking point the analyst e-mailed me, referring to a confidence-inspiring, to some Portuguese hence growth-promoting translation of some of the text. He told me that he order. In often imperceptible ways, think tanks was using my arguments on the protection of private around the world have thus done much to make property rights in a court case he was preparing. I the ideas about a free social order and the role of wished him good luck. self-reliance and economic freedom popular and The reader may feel that this case study is too relevant to public policy. self-congratulatory. However, given the difficulties And this is a tale worth telling!
48 POLICY • Vol. 31 No. 2 • Winter 2015 ARTICLES
LAUDATO SI’: WELL INTENTIONED, ECONOMICALLY FLAWED Pope Francis has too negative a view of markets, but he is no Marxist.
n the lead-up to the release of Pope Francis’s events of 2008 there has been a major failure to new encyclical Laudato Si’, most commentary reform the world’s financial systems (189). Likewise focused on its likely implications for the the pope’s tough words for those who regard world’s climate change debate. An effort to population growth as somehow damaging the Iinfluence that discussion—much of which has environment and impeding economic development long since faded from public prominence and are spot-on. become confined to international organizations, Nonetheless, many conceptual problems and NGOs, government bureaucrats, and professional questionable empirical claims characterize the lobbyists—is clearly part of the encyclical’s encyclical’s vision of contemporary economic life. immediate intent. Moreover, despite the text’s In terms of environmental degradation, Laudato occasional wandering into very technical subjects, Si’ appears oblivious to the fact that the twentieth such as the impact of air-conditioning, this long century’s worst economically driven pollution and, at times, awkwardly written document’s occurred as a result of centrally planned state deeper significance will surely be how it shapes industrialization schemes in former Communist Catholic theological reflection upon man’s nations. Anyone who’s visited Eastern Europe relationship with the natural world. or the former USSR and witnessed the often But while most of the text’s reflections upon devastated landscape will quickly attest to the public policy issues focus on the environment, validity of that insight. a subterranean theme that becomes decidedly Then there is the encyclical’s use of ‘global north visible from time to time is the encyclical’s deeply and south’ language to describe some of the global negative view of free markets. This would confirm economy’s dynamics. This terminology has been that this pontificate’s reaction to respectful used occasionally by popes in the recent past. But it questions asked about the adequacy of the also reflects the conceptual apparatus economic analysis contained in Francis’s 2013 of what was called dependency Apostolic Exhortation Evangelii Gaudium has theory: the notion that resources— been to simply recycle (no pun intended) some of especially natural resources—flow that document’s demonstrably flawed arguments from a ‘periphery’ of poor countries concerning the market economy’s nature and effects. to a ‘core’ of rich states, thereby To be sure, there is much about today’s global benefiting the wealthy at the poor’s economy that merits criticism. The encyclical expense. This meant, according rightly underscores the problem of bailing out banks at everyone else’s expense. Does anyone doubt that, if the world faces another series of Dr.Samuel Gregg is director of research at the Acton major bank failures, governments will behave in Institute. These remarks, which first appeared in the exactly the same way, thereby reinforcing the moral American Spectator, were the basis of an address he hazard problem that is at the root of so much of the delivered at the Centre for Independent Studies on 30 financial sector’s ongoing dysfunction? The July 2015 encyclical also suggests, correctly, that despite the
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to dependency theory economists, that peripheral popular and non-technical terms, that the nations should restrict trade with developed problems of global hunger and poverty will countries and limit foreign investment. The point be resolved simply by market growth. was to reduce their reliance on exports of raw minerals and agricultural products, consequently Growth is of course indispensable for saving promoting the emergence of domestic industrial people from poverty. There is no long-term remedy sectors. to persistent poverty without growth, and market This understanding of the global economy, economies have an unmatched ability to produce much of which was formulated by Latin American such growth. But whoever ‘some circles’ might be, economists in the 1950s, has long been discredited. I don’t know of any market advocates who believe Not even many center-left economists are willing that growth alone is the answer to hunger and to defend it. There are, for instance, countries in poverty. Many other things need to be in place, the ‘global south’—such as Chile and Australia— most notably the right moral, cultural, and that are formally classified as developed economies. institutional settings. These range from something Furthermore, they have become wealthy as fundamental as rule of law (largely absent partly because of (a) mineral and agricultural from most Latin American countries and about exports and (b) conscious choices to integrate which Laudato Si’, like Evangelii Gaudium, says themselves into the global economy rather than nothing) to vibrant civil societies. Most free remain cowering behind protectionist barriers market advocates have been making these points while trying to prop up uncompetitive industries for decades. through subsidies. Laudato Si’ then claims that
They are less concerned with certain The not-so-veiled claim that people who economic theories which today scarcely favour free markets are being disingenuous anybody dares defend, than with their is a serious allegation. actual operation in the functioning of the economy. They may not affirm such theories with words, but nonetheless And where, one might ask, do ‘northern’ support them with their deeds by showing hemisphere economies such as Russia’s crony- no interest in more balanced levels of corporatist arrangements or the Middle East’s production, a better distribution of wealth, petroleum economies fit into this north–south concern for the environment and the global economic schema? The answer is that they rights of future generations. Their behavior don’t. In short, if the north–south paradigm is how shows that for them maximizing profits is the Holy See understands the global geopolitical enough. Yet by itself the market cannot scene, it’s effectively clinging to a perspective of guarantee integral human development the world economy whose profound limitations and social inclusion. were already apparent by the early 1970s. Another problem with Laudato Si’ and Leaving aside the first sentence’s sheer vagueness previously manifested in Evangelii Gaudium is (who are ‘they’ and what ‘certain economic theories’ an oversimplification of the views of those who have been found wanting?), it’s hard not to view believe that free markets are the optimal economic some of this language as bordering on populism. way forward for individual nations and the world. The not-so-veiled claim that people who favour Here’s one example from the encyclical: free markets are being disingenuous is a serious allegation, one that isn’t sustained by the briefest Some circles maintain that current of glances at the writings and actions of many free economics and technology will solve all market thinkers ranging from Wilhelm Röpke to environmental problems, and argue, in Adam Smith himself.
50 POLICY • Vol. 31 No. 2 • Winter 2015 SAMUEL GREGG
It is untrue, for instance, that being in favour flourishing in non-market economies); its failure to of free markets means that you’re necessarily critique the left-populist regimes that have brought unconcerned for the environment and obsessed with economic destruction and increased poverty to profit. Many free market supporters have devoted countries such as Argentina and Venezuela; and their lives to devising ways to align economic its attribution of suspicious motives to those who incentives in the direction of environmental favour markets, runs contrary to this appeal for conservation. Nor is it just to say that free marketers open and respectful debate. are uninterested in future generations. It has been, It’s true that some Catholic clergy and activists for the most part, people who favor free markets apparently think that dialogue with the world who have been arguing that the current recourse means listening more-or-less exclusively to what the to debt by Western governments in order to avoid (increasingly atheistic and anti-Catholic) political making hard but necessary fiscal reforms is laying left thinks about any given issue. This, however, up enormous trouble for future generations. Those isn’t an excuse for stigmatizing the position of of a more-interventionist or Keynesian disposition those who make the simple and hard-to-deny point are generally silent on this subject or don’t think that the greatest and fastest reducer of poverty in it is a real problem. history at the global, national, and local level has Lastly, you could probably count on one hand the been the market economy and the habits, culture number of promoters of free markets who believe and institutions on which entrepreneurship, free that economic freedom alone will assure all-round exchange, and the growth of surplus capital depends. human flourishing. Take, for instance, Adam Smith. None of this is to deny that some economic Not everything in Smith’s thought is reconcilable conservatives’ criticisms of Pope Francis since with the Catholic vision of man. But Smith’s vision 2013 have verged on the absurd. The briefest of of commerce and market exchange is rooted in a glances at the Pope’s writings underscores that wider civilizational vision that (a) stresses the need Jorge Bergoglio is no liberation theologian. It for a strong civil society; (b) acknowledges that there is equally nonsensical to describe this pope as a are some things that only governments can do and Marxist. Indeed, Pope Francis’s pointed defense that there will be times when government economic of innocent life from conception onwards, intervention is needed; and (c) underscores the his forthright condemnations of euthanasia, importance of commercial, classical and, yes, and his increasingly ferocious criticisms of the Judeo-Christian virtues prevailing in a society if a fantasy-world otherwise known as ‘gender theory’ free economy is going to flourish and benefit the contradicts the most basic of contemporary left- majority rather than just privileged elites who enjoy wing orthodoxies. close ties to the political class. For all that, however, and despite the undoubted What’s sadly ironic about all this is that the authenticity of Pope Francis’s love and concern for very same encyclical which makes such sweeping the poor, it’s lamentable that this pontificate seems assertions about the free market and its advocates so unwilling to engage in a serious discussion about is also marked by several welcome calls for the market economy’s moral and economic merits reasoned and broad debate about how we address vis-à-vis the alternatives. Society’s wellbeing and environmental and economic problems. Laudato the common good can’t be reduced to economic Si’ also emphasizes that the Church doesn’t have a efficiency or growth. Nor will free markets save monopoly of wisdom on the prudential dimension our souls. But given the right ethical, social, and of environmental and economic questions. Yet institutional environment, economic freedom and the encyclical’s use of phrases such as ‘deified a vibrant commercial sector can go a long way market’ and ‘magical conception of the market’; its to delivering us from the disease, poverty, and unsupported association of moral relativism with economic stagnation that marked most of pre– Adam Smith’s ‘invisible hand’; its relentless linkage Wealth of Nations Europe and which still plagues of the market with materialism and consumerism much of the developing world. It’s a lesson, it seems, (neither of which have had any difficulty that much of the Catholic world still needs to hear.
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CHARTER SCHOOLS, FREE SCHOOLS, AND SCHOOL AUTONOMY The prospects for innovative education models in Australia.
harter schools and free schools are among with the condition that they do not charge tuition the range of options that can be used to fees, and meet some conditions around enrolment decentralise public school management and access. However, they do not have to teach the away from state governments and national curriculum, and they have a large degree of Cincrease the extent of school autonomy in systems flexibility in school staffing. Teachers do not have to of schools. be registered, and teacher pay and conditions are set There are no charter schools in Australia. by the school.5 Charter schools are public schools but they are not Many other countries have funding and government schools; they are managed by a private governance arrangements that allow the organisation under a legislative contract or ‘charter’ establishment of privately-managed, free schools, with the government. They can be new schools, or including Sweden, Chile and the Netherlands. New former government schools whose management has Zealand began heading down this path in 2014 been given to a charter school operator. with what they have called Partnership Schools — Charter schools receive public funding similar which are very similar to England’s free schools, to the funding provided to equivalent government with similar freedoms in provision, underpinned by schools and do not charge fees. Often the charter will rigorous accountability requirements.6 stipulate that the school must have open enrolment and must have non-discriminatory hiring policies, but there is no reason why charter schools could not have a specialisation. The charter can also specify other aspects of schooling, including employment practices and curriculum but the rationale of charter schooling is to release schools from these restrictions.1 The vast majority (88%) of charter schools in the US are not unionised.2 The charter school movement began in the United States, where there are around 1.6 million students in 5,000 charter schools, across 40 states, Trisha Jha is a Policy Analyst at The Centre for representing about 5% of all public schools. For- Independent Studies working on school education, early profit organisations run 16% of charter schools3 childhood education and care, and family policy. and in 2013, there were around 586,000 children on charter school waiting lists.4 Jennifer Buckingham is a. Research Fellow at The The ‘free schools’ now operating in England Centre for Independent Studies working on school are similar to charter schools. They receive public education policy. funding equivalent to similar government schools
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Table: Differences between school sectors
Traditional public school Independent public school Charter/free school Non-government school School Government Government Charter Management Private organisation/ management Organisation/ charity Education Management Organisation/private organisation Fully Yes Yes Yes No – partly government government funded funded?
Can charge No No No Yes tuition fees? Budget In some states Yes Yes Yes autonomy Enrolment Residential zoning, Residential zoning Application and lottery Application, some selective some selective State/ Yes Yes No Yes national curriculum? Teachers Must have registered Must have registered Charters: depends on Must have registered teachers; school-based teachers; school-based district but most have teachers; school-based hiring varies between hiring. school-based hiring. hiring. states. Free schools: school- based hiring.
Box 1: Charter schools, Independent Public Schools and non-government schools In 2008, the Western Australian government implemented its Independent Public Schools policy, allowing public schools to become self-managing. There are 441 Independent Public Schools in Western Australia, which is more than half the public schools in the state.7 In Queensland, 130 schools have become Independent Public Schools since 2013.8 All states and territories have received federal government funding to devolve more management to schools.9 For Independent Public Schools and Catholic systemic schools, the most accurate description of their governance structure is school-based management. It is technically a misnomer to call self-managing public schools ‘autonomous schools’. The only Australian schools to which the autonomous schools definition might apply are independent schools, but they also must meet heavy obligations in order to receive government funding, including: implementing the Australian Curriculum; participating in NAPLAN testing; and providing student and school data to be published on the My School website. Independent Public Schools are often confused with charter schools. They are not; the key difference being that Independent Public Schools are still government-owned and operated. In Independent Public Schools, the principal and staff are government employees and schools must adhere to state industrial legislation and curriculum and other state and national policies. They are government schools that operate with financial autonomy and greater latitude in staff hiring.
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What Is a Charter School? schools — schools with a focus on traditional maths A charter school is, at the most basic level, a and reading instruction, frequent testing, strict school that ‘combines public funding with private discipline and behaviour standards, and often with a management.’10 Unlike traditional non-government longer school day and year.11 They selectively recruit schools in the US (which generally do not receive highly motivated and committed teachers and have public funding as a matter of course, unlike in a culture of high expectations of both students and Australia), charter schools cannot charge top-up staff.12 These school characteristics are more likely fees and cannot be selective in which students they to be found in charter schools than traditional admit: if a school is over-subscribed, enrolment public schools largely because of the employment must be through a lottery. conditions stipulated for unionised teachers in Charter schools in the US are mostly overseen public school systems that limit working hours and by school districts, with states having overarching do not allow schools to negotiate higher teacher legislation that sets out minimum standards for salaries for longer hours or for meeting performance district charter agreements. This is in contrast to the goals. Charter schools do not generally have these other countries discussed in this report, where the restrictions on their operations. legal and governing architecture of charter schools One of the most successful and well-known is set at the national level. Inter-state or even intra- networks of charter schools is the Knowledge state (where charter policy is set by school districts) is Power Program (KIPP) schools. Studies have comparisons are therefore complicated as they rarely consistently shown KIPP students significantly involve like circumstances. out-perform traditional public school (TPS) students, and that this is not due to attrition of Characteristics of High-Impact low performers.13 Other successful charter school Charter Schools networks are the Aspire, Achievement First, IDEA, Highly effective charter schools tend to be those that Success Academies, and Uncommon schools, all of encapsulate the approach described as ‘no excuses’ which are run by CMOs.
Box 2: Knowledge is Power Program (KIPP) The KIPP Foundation is one of the largest charter management organisations in the United States and was originally founded by veterans of the Teach for America program. The KIPP model is centralised and emphasises traditional teaching methods in math and English, strong discipline, hard work for students and longer school days and school years.14 These are common characteristics of charter schools, especially those serving largely low income and minority students. This approach is encapsulated in the ‘Five Pillars’ — high expectations, choice and commitment, more time, power to lead and focus on results — that culminate in a ‘Commitment to Excellence’ contract that students, parents and teachers sign.15 Angrist et. al. (2011) examined the impact of the KIPP model in a middle school in Lynn, Massachusetts, which has a high proportion of Hispanic, ESL and special education students. As the school is over-subscribed, the student intake is determined by lottery, which provides data that is less likely to be subject to selection bias.16 Nearly 80% of the student body come from households with a low enough income to make them eligible for free or reduced-price school lunches.17 The study finds small improvements in reading scores overall but moderate improvements for ESL and special education students. Similarly, there are moderate improvements in overall maths achievement, and slightly larger still improvements for ESL and special education students.18 Another study by Tuttle et. al. (2010) examines 22 charter middle schools run by KIPP. Students who attended these schools had achievement levels below the local school district average prior to attending KIPP. The authors find that, firstly, students in most KIPP schools experience positive gains in reading and maths achievement and, secondly, these effects are rather substantial.19
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Aspire Public Schools is a non-profit charter race and income achievement gap and test scores management organisation that currently operates indicate this goal is being met. The Connecticut 38 schools, predominantly in California and more and New York state-wide test scores showing recently in Tennessee, serving 14,600 students across proficiency achievement levels in Achievement First all grades.20 Like KIPP, Aspire uses a model in which schools were mostly at or above the state average for management responsibility, support and control are all students for reading, maths and science, and well highly centralised, with both management models above the proficiency achievement rates for schools and school design consistent across all sites.21 Aspire with similar demographics.32 schools have longer school days and a longer school Both the 2015 CREDO study and a number of year, with classes often being held on Saturdays.22 other studies have reported especially strong charter Aspire schools collectively outperform every large school performance in the state of Massachusetts, California school district with a majority of low but more particularly in the city of Boston. A income students in the Californian Academic research partnership between Harvard University, Performance Index.23 Aspire’s motto is ‘College for the Massachusetts Department of Elementary and Certain,’ and 2014 was the fifth consecutive year in Secondary Education and the Boston Foundation which 100% of graduating seniors were accepted has been studying the progress and performance of into four year colleges.24 charter schools in the state since 2009.33 Charter Another similar success story can be seen in schools in Massachusetts have 60% non-white IDEA Public Schools, a charter management students, compared with 30% non-white students organisation which operates 36 schools in Texas, in other schools. serving more than 20,000 students. Like KIPP, IDEA was founded by Teach for America alumni Boston’s charter schools have been major and uses a comparable approach to KIPP and pioneers of the increased freedoms and Aspire from a management perspective, which has flexibilities that have since been extended become increasingly centralised over time.25 Like to other schools. Aspire, IDEA uses IT in a ‘blended learning’ model and is strongly focused on college preparation. All students take Advanced Placement courses.26 Similar to other research, the studies found Another major focus of IDEA is its recruitment; some charter schools were more successful than offering salary bonuses to teachers in high demand others; in particular, charter schools in urban areas disciplines, teachers with advanced degrees, and for that enrol more students with socio-educational years of service.27 IDEA schools have sent around disadvantages. The studies found these schools tend 99% of its graduates to college in all seven years to have longer school days, spend more time on of graduating classes.28 IDEA schools on average reading and maths, and are more likely to identify achieve above the state and local school averages in with the ‘No Excuses’ approach to education.34 state exams.29 Across all US states, around 10% of charter schools Achievement First is a CMO operating 30 have extended learning time. In Massachusetts, public charter schools with 10,000 students across around 70% of charter schools have extended all grades in Connecticut and New York states. The learning time.35 A report on Massachusetts schools majority of students (88%) are low income, and by Sir Michael Barber and Simon Day found that 99% are African-American or Hispanic. Admission Boston’s charter schools have been major pioneers is by a blind lottery system.30 Achievement First of the increased freedoms and flexibilities that schools have a strict academic and discipline have since been extended to other schools in the culture, which again sees a longer school year, public school system with positive impacts on with tuition available outside school hours and on achievement. Barber and Day recommend lifting Saturdays. Generally, this additional time is devoted the cap on charter school numbers to enable the to mathematics and reading.31 The stated aim of the most successful CMOs to reach more of the most Achievement First school network is to close the disadvantaged students.36
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Prospects for Charter Schools in Australia school choice further in Australia through the Incorporating a charter model into public school introduction of charter schools as a fourth school provision in Australia would be a departure from sector. the status quo. For that reason, it is necessary to Introducing charter schools is not like explore some of the reasons why the provision of implementing a voucher policy. System-wide public education could be enhanced by such a competitive effects are not the main objective but change. The review of the literature thus far also are a possible result. The Grattan Institute report is has much to say about what can be done to make sceptical about the effect of competition on school charters an effective and desirable option as schools achievement but international studies have found an of choice within the public school landscape. association between school policies that introduce The foundational reasons are to enable choice competitive effects and system level achievement.38 to families who currently have little. The Grattan As noted by Dean Ashenden, competition between Institute’s research has shown there are low levels charter and state schools has been beneficial in of school choice for the majority of Australian some locations in the US, but not alone. According families, as public schools usually utilise residential to Ashenden, ‘it all depends on what competition zoning, and non-government schools charge fees (or any other nostrum) is combined with, and that make them less accessible.37 The conception of the circumstances in which that combination is school choice sees choice as a good in itself but it deployed,’ including a fair regulatory playing field, has other benefits. which Ashenden believes does not currently exist in Allowing the establishment of charter schools Australia.39 (or ‘free schools’ or ‘partnership schools’) would One potential consequence of school choice serve several purposes. It would extend school policies is a ‘residualisation’ of some schools and choice to more families who are not currently students. This could occur if the most engaged and catered for, either because their choice of public active students are more likely to exercise choice, school is restricted by zoning, or because they leaving some schools with higher concentrations of cannot afford school fees, or they do not want disadvantaged students. a religious education for their children. Almost Two reports prepared for the ‘Gonski’ review all non-government schools in Australia have of school funding discussed the impact of choice religious affiliations, and those which do not often on equity—one by the Australian Council for subscribe to alternative educational philosophies Educational Research (ACER) and the other by a that would not be appealing or effective for some consortium led by the Nous Group.40 Both reports families. Charter schools are most often secular and provided equivocal findings but concluded that always free. choice does increase inequity. Nonetheless, neither report recommended that Charter and free schools aim to extend choice be curtailed. They acknowledge the evidence for positive effects of competition, especially from choice to students who currently have OECD research, and recommended that equity few options. effects might be moderated by policy safeguards such as funding models that encourage enrolment It is true that Australia’s relatively unique system of disadvantaged students. Charter and free schools of widespread funding of non-government schools aim to extend choice to students who currently have by state and federal governments adds a dimension few options, arguably forming part of the solution of choice to the school landscape which did not to equity effects of the existing system. The research exist in other countries prior to the introduction evidence presented in this report indicates that this of charters or their equivalents; elsewhere, it was a is a reasonable expected outcome.41 choice between a monolithic public school system Another purpose of charter schools is to and an exclusive wholly-private school sector. innovate. Because charter schools are usually schools However, there are still good reasons to expand of choice and do not have the same restrictions on
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6 The Government of New Zealand Ministry of Education, their operations as public schools, they are able to 2015, Partnership Schools | Kura Hourua, Wellington, do things differently. Other schools can learn from viewed 8 July 2015,
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20 Aspire Public Schools 2015, About Aspire, viewed 8 July 32 The Broad Prize for Urban Education, 2014, The 2014 2015,
58 POLICY • Vol. 31 No. 2 • Winter 2015 BOOK REVIEWS
Christian Reconstruction: Intellectually, Rushdoony was impressed by the R. J. Rushdoony and work of a Calvinist theorist, Cornelius Van Til, American Religious who argued for the significance of the intellectual Conservatism presuppositions from which people worked and of Michael Joseph McVicar the need for Christians to operate on the basis of University of North their own intellectual presuppositions, which in his Carolina Press, 2015 view were the only ones adequate for understanding $34.95, 326 pages the world. Rushdoony also came across, and was ISBN 9781469622743 sympathetic to, the free-market approach of Reviewed by Spiritual Mobilization. He developed his own Jeremy Shearmur political interpretation of Van Til, on the basis of which Christians should have nothing to do with f one considers libertarianism and classical the state—which, he thought, had usurped the liberalism in the mid-twentieth century, one sovereignty which belonged only to God. Instead, typically thinks of figures such as Mises, Hayek, they should build networks based on families and IAyn Rand, and Murray Rothbard. All of these played churches. In this context, Rushdoony was an important important roles. But if one pays attention only to and influential proponent of home schooling. them, one is liable to lose sight of an important point: Rushdoony was an omnivorous reader. He is best that religious ideas also played a significant role. understood as a fundamentalist Calvinist, who These ranged in their character from the differed radically in his view from the kind of Presbyterianism of J. Howard Pew and Jasper Crane ‘pre-millenial’ rapture theology to be found in (important as business people with strong intellectual the annotations in the Scofield Reference Bible and interests, and as financial supporters of classical as popularized in the best-selling Left Behind novels. liberal causes) to the unorthodox spiritual ideas (In Rushdoony’s view, Christians should work of Leonard Read of FEE and of the organization independently of the state, and Christ will return Spiritual Mobilization (on which, see Brian Doherty’s only after the conversion of the world—or at least Radicals for Capitalism). Perhaps the key funding most of it.) Rushdoony also held other distinctive source was the Volker Fund, run by Harold Luhnow views; in particular, on the relationship between (who also had strong religious concerns). Luhnow the Old and New Testaments. (There was always an provided important start-up funds for FEE; paid issue as to the extent to which the Old Testament the wages of Hayek at Chicago and Mises at New was to be seen as superseded by the New, and just York University; employed Rothbard, and provided how much of Old Testament legal teaching was to funding for Spiritual Mobilization. remain in the light of the recruitment of non-Jews One of the stranger figures in this network was into the Christian Church, and St. Paul’s arguments Rousas Rushdoony, the subject of the book under about the implications of this.) Rushdoony’s view review. (Those with an interest in classical liberalism was that much of the Old Testament teaching still might find McVicar’s earlier “The Libertarian held good, including gruesome punishments for Theocrats,” available at the online archives ofThe homosexuals and for rebellious children. Quite Public Eye magazine, useful in explaining some of who is to inflict this on whom, given Rushdoony’s the background.) Rushdoony—who has incorrectly repudiation of the state, seems to me not too clear: been claimed to have been an influence on George any body that can do this to the non-consenting W. Bush—was a Calvinist, of Armenian extraction. looks to me all too much like a state. He was brought up in the United States, where as a Rushdoony was also an extremely prolific young man he undertook missionary work among writer. Many of his works can be downloaded for Native Americans in Nevada and was struck by free from the Chalcedon Foundation, which the devastating consequences upon their lives of Rushdoony set up and which is still promulgating government control. his views (see www.Chalcedon.edu) In addition,
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his son-in-law Gary North, who followed Rushdoony’s somewhat unstable, and to have come to the ‘reconstructionism,’ has written equally prolifically conclusion—egged on, it seems, by Bierly—that on economic issues. (He was initially influenced ‘atheists’ were trying to take over the Volker Fund. by Mises, but developed his own methodological At that point, Luhnow announced that he had approach; his more recent writing seems to me largely promised, to Volker, that the Fund would be wound a matter of drawing lessons for economic conduct up at a specific period, which he proceeded to do (so from Biblical material, rather than economic analysis that Volker Fund employees were given notice, and in the more usual sense.) IHS, which was expecting to receive money from the McVicar’s most interesting book discusses Volker Fund, was cut adrift with only seed funding). Rushdoony’s career, views, and ‘reconstructionism’ In one memorandum, however, Luhnow announced as a movement. While McVicar in no sense shares that it would be Bierly’s organization (which had Rushdoony’s views, a resident scholar at the Chalcedon explicit religious concerns) which would continue Foundation gave the book a most respectful treatment the Volker Fund’s work. Bierly had recruited and thought that there were only minor errors Rushdoony to work for him, but it seems that (see Martin G. Selbrede, “First Major Book about Rushdoony and some associates of his tried to push R. J. Rushdoony,” available at Chalcedon.edu; a strong line in intellectual Calvinism onto all the see also the review in First Things, April 2015, for a staff—with the result that Rushdoony was sacked, treatment by a mainstream but conservative Calvinist). albeit with funding to continue some writing. Bierly From the point of view of the classical liberal, had also recruited a ‘revisionist’ historian (this had the most interesting feature of McVicar’s book is been a Volker Fund interest). But the man turned his account of the involvement of Rushdoony with out to be uncomfortably sympathetic to Nazi the final years of the Volker Fund. (McVicar also Germany. Bierly and Luhnow had hoped that they has a separate and most interesting piece on the would be able to get some association with the Volker Fund, “Aggressive Philanthropy: Progressivism, Hoover Institute at Stanford, but with autonomy. Conservatism, and the William Volker Charities This Hoover were not willing to grant, and Luhnow Fund,” published in the Missouri Historical Review seems to have given up and to have donated the and available at McVicar’s Florida State University bulk of the Volker money to hospitals. A certain faculty page.) Putting McVicar’s account together amount remained, and after Luhnow’s death, some with other sources, the story seems to be this: Ivan scholars previously associated with the Fund were Bierly, who had been colleague of Baldy Harper’s approached by James Doenges (who had been on at Cornell and who had moved with him to FEE, IHS’s original board) to see if they had projects ended up working for the Volker Fund. Bierly which might be suitable for funding. But Doenges was a Calvinist, and he became enamoured with died before the post-Luhnow Volker Fund board Rushdoony’s work. meeting took place, and the The Volker Fund had been committed to a policy chair was not interested: the of anonymity in its giving but found that this started residue of the money seems to to clash with the attention that its activities were have been given to the Hoover attracting. It sought to resolve this by setting up Institution. subsidiary organizations either within or at arm’s length from the Fund. (This is how the Institute Jeremy Shearmur is for Humane Studies got started.) One of these emeritus fellow, School organizations was a Centre for American Studies, of Philosophy, Australian run by Bierly. Luhnow seems to have become National University.
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