20, í:; M ULTIFUNCTION POLIS LOST CITY OF OPPORTUNITY Coral Baines July 1999 This thesis is submitted to the Department of Politics, The University of Adelaide for the degree of Doctor of PhilosoPhY. ABSTRACT its possibilities and This thesis examines the Multifunction Polis concept, to Australia its failure. of primary concern is the proposal of the concept concept was the by the Japanese in 1987. The rationale for this original as the means promotion of twenty first century manufacturing industry thesis therefore is to revive economic growth. Part of the context of the 1980s' the faltering state of the Australian economy in the mid 1980s was a time of The Japanese context is also examined. The mid the possibility of a spirited d.ebate about Japan's economic success and world was based on the Japanese bid for global hegemony. The post-war political structures principles which embod.ied the social, economic and concessions that reflected America,s internal power structures, including growth was to remove mad,e to labour. America's solution to stalled world International barriers to free trad.e and withdraw its support for the principles of weak Labor organisation, effectively universalising the new its own interests as state and weak labour. since Australia had identihed economic coterminous with those of the united States, its shift to those terms' rationalism and enterprise bargaining can be explained in development However, Japan had, d,eveloped a unique mod'e of capitalist principles in the face and its challenge was to retain its own constitutive the new trade of increasing pressltres from America to align itself with order. precisely its Ministry The argument of the thesis is that Japan, or more its of International Trade and Industry (MITI), planned to universalise labour through own constitutive principles of strong state and weak are effective direct foreign investment. Japanese corporations abroad il carriers of Japanese corporate practices embodying the virtues of weak labour, and. their presence in the MFP would provide the opportunity to establish those practices in Australia. Japan's principle of strong state, characterised by a close association with business, would be encouraged by the need for the Australian state to collaborate with the private sector in the identification and establishment of long term growth industries in the MFp. The 'international' flavour of the MFP would give universal exposure to these PrinciPles. Australia's adoption of economic rationalism circumvented the plan, and along with that went the possibility of establishing a high technologr manufacturing base for this country' llt DECLARATION This work contains no material which has been accepted for the award of any other degree or diploma in any university or other tertiary institution and., to the best of my knowledge and belief, contains no material previously published or written by another person, except where due reference has been made in the text' I give consent to this copy of my thesis, when deposited in the university Library, being available for loan and photocopying. Coral Baines July 1999. IV ACKNOWLEDGEMENTS I would like to thank the many busy people who generously consented to lengthy interviews about their involvement in the Multifunction Polis project. Their frank opinions were of great value to my research' My involvement in preparing the united Trades and Labor council submission to the MFP Community Consultation Panel and in conducting workshops which aimed to elicit an overall union response was also of great value, and I thank the UTLC for the opportunity' Finally, I would like to thank my Supervisor, Professor Doug McEachern for his patience and support, my partner Peter Davey for his gentleness and. compassion and my son Matthew for his endurance. CONTENTS PAGE Abstract 1 Declaration 111 Acknowledgements iv Chapter 1 lntroduction 1 The original MFP concePt 4 Ghapter 2 Theoretical Framework 27 Introduction 27 Historical Materialism applied to International Relations Theory 31 Pax Amerícana 36 The State Derivation Debate 45 The Reformulation of the State Derivation Debate 48 Conclusion 64 Chapter 3 Japan's Search for a New Global Role 66 Introduction 66 Conclusion 93 Ghapter 4 Why a Multifunction Polis? 94 Introduction 94 The Technopolis Program 96 Japanese Foreign Direct Investment to2 Japanisation of British Industry r07 Universalising Japanese Corporate Strategies 111 The Exclusion of Organised Labour in Japan tt4 Conclusion L23 Chapter 5 Australia, The Global Economy and the MFP 126 Introduction r26 Elements of the Global Crisis r29 Overaccumulation and Crisis 133 The Limits of Keynesianism r34 Australia in the Postwar Period 140 Hawke, Restructuring and Global Capital T4B The Float of the Dollar 153 Japan-AFriendlndeed! r57 Conclusion L66 PAGE Ghapter 6 Organising a Business Response: Gommercial 168 Opportunities versus Single Site Introduction 168 Strong States L70 Technopolises and Technologr Parks 174 Organising Business 184 Business Attitudes t96 Choosing the Site 200 Conclusion 203 Ghapter 7 What Happened to Manufacturing? 208 Introduction 208 Computer Software Industry 2ro Rare Metals and Rare Earths 2rl Biotechnolory 212 Conclusion 234 Chapter 8 Unions, Post-Fordism and the MFP 235 Introduction 235 Political Unionism in Australia 244 o Flexibility 247 o Skills Development 248 o Industrial Democracy 249 Business Unionism in Britain 254 o Caterpillar 255 o Ford 256 o Nissan 257 Unions and the MFP 259 Conclusion 265 Gonclusion 267 Appendix A Chronologr 277 Appendix B Interviews 284 Appendix G Community Debate 299 Bibliography 311 FIGURES AND TABLES FIGURES PAGE 1.1 Organisational Structure of the MFP Feasibility Study 9 TABLES 6.L Think Tanks 189 6.2 Statement of Principles 194 6.3 Sixteen Criteria For Site Selection 20t c INTRODUCTION LggT marked a decade since the Japanese first proposed to the Australian government that the two countries collaborate to build a multifunction futuristic city in Australia. A year later the MFP was officially abandoned by the South Australian government. The MFP project held out huge possibilities for the country in both a direct economic sense and in terms of developing new ways for Australia to profit from new technologies. It was widely believed that if Australia embraced these opportunities then the country could prosper. But the country did not respond well. Although it was eleven years before the project was abandoned, in truth it took less than a year for the initial potential to be lost. Even though a federal Labor government was present at its inception and a state Coalition government oversaw its demise, the party that was in office is not important. What is at issue is that as a nation Australia was unable to embrace the possibilities inherent in the project. Why were the significant opportunities of the initial project squandered? Hamilton suggests that the establishment of a set of nine principles, written late in 1987, acted as a map to guide our exploration of the concept. "But", he says, "as with the explorer who draws his map before setting off, the risk was that we would find only what we could imagine and miss the unexpected treastlres".l In a sense he is right' That is 1 Walter Hamilton (1991), p. 4a. 2 largely what did happen, but those principles were simply the reflected reality, or ontolory, of the time. They reflected a set of shared meanings that in turn defined the development of the concept. Cox argues that "[o]ntologies are not arbitrary constructions; they are the specification of the common sense of an epoch".2 This thesis aims to uncover part of that Australian ontologr and to show how it shaped and limited the potential inherent in the concept of the multifunction polis. It is important to assert at the outset, however, that as analysts \Me can be aware that people generally will act in accordance with the prevailing ontologr, but that those actions are not determined. There are conflicts and tensions within specific practices which hold out possibilities for alternate outcomes. The extent to which these conflicts and tensions are apparent is the measure of alternative possibilities. As a concept the MFP project remained vague, ambiguous, contradictory and unclear until November L996 when the South Australian government gave approval for the development of Mawson Lakes, adjacent to the existing Technolory Park at The Levels, South Australia. At this point, the meaning of the concept became fixed as a 620 hectare urban extension to Technolory Park. Even at this stage the proposal included scope for possible new high technologr industries which planners hoped would be attracted to the area. However, the project's transformation from the nebulous to the concrete was accompanied by a renunciation of the concept of a multifunction city of the future and an acceptance of a much more limited and conventional regional urban development project. In IggT the MFP project offìce was reorganised and then closed. The urban d.evelopment project is still going ahead but now under the jurisdiction of the South Australian Land Management Corporation. What happened? 2 Timothy J. Sinclair (1996), citing Robert Cox, p. 9 J As a hrst step toward explaining what happened, it is useful to consider a comprehensive account of what the MFP was meant to be, as described in both Japanese and Australian documents. It is through an exploration of the inconsistencies in these documents that somè pointers are found to guide analysis. It must be remembered that ten years is very long time in political and economic terms. When the concept was first proposed, Japan had a huge export surplus built on a highly efficient manufacturing sector and \Mas awash with funds seeking international investment opportunities. Australia was its mirror image.3 It had a growing export deficit as a result of an inward looking and inefficient manufacturing sector, an over reliance on an uncertain commodit5r market and was seeking international investment to help modernise its economy.