2 EditorialSome high-profile NGOs, that have built solid reputa-tions over time, risk ‘brand-name’ damage if they persistwith ill-informed or baseless campaigns. Mike Nahan

3 WWF Says ‘Jump!’, Governments Ask ‘How High?’There is a disturbing trend for governments to makeenvironmental policy in the absence of sound science—as their reaction to WWF’s Great Barrier Reefcampaign demonstrates. Jennifer Marohasy andGary Johns

6 The Human-Rights Lobby Meets TerrorismThe inability of the world’s leading human-rights NGOsto come to grips with terrorism—both before and afterSeptember 11—shows just how much they have lost theplot. Adrian Karatnycky and Arch Puddington

10 The Age and BiasThe Age’s coverage of the recent Green blockade atMarysville highlights, yet again, that paper’s inability tolive up to its professed principles on fair and accuratereporting. Graeme Gooding

12 The ‘R’ FilesAustralia is blessed with abundant natural gas, but theindustry is cursed by inappropriate regulation. The result:sub-optimal outcomes all round. Alan Moran

15 Greenhouse and Green Energy: Ten RealitiesAnalyses of Australia’s official Greenhouse ‘SuccessStories’ reveal more grounds for deep scepticism thanthey do for back-slapping. Brian J. O’Brien

17 Education AgendaAcross the world, governments are providing more andmore data on schools, standards and performance.Australian governments have similar data—but lack theinclination to share it with parents. Kevin Donnelly

18 The Secular West and the Dangerous Quest forMeaningThe opponents of Western success—be they religiousor ideological—understand neither its underpinningsnor its broad appeal. But that doesn’t stop themexploiting one of its strongest virtues—its tolerance.Andrew McIntyre

19 The Blair FilesIt is a given that ‘poverty causes terrorism’. But does it?Our newest regular contributor ponders the real linksbetween terrorists and wealth. Tim Blair

21 What’s A Job?The IR system has more to do with the state seeking toprotect employers from high labour costs than it doeswith the protection of workers’ rights. Ken Phillips

22 Strange TimesThe weird, the wacky and the wonderful from aroundthe world. Compiled by IPA staff and columnists

23 Letter from LondonTony Blair promised ‘joined-up’ government. Instead,Britons now suffer bureaucratic inertia born of regula-tory overload. John Nurick

24 Free_Enterprise.comInternet resources for arriving at a radical conclusion:repeal all drug laws now! Stephen Dawson

26 Letter from AmericaThe collapse of Enron is not what the anti-capitalistcritics claim it is. In fact, the very opposite—capitalismworks! Nigel Ashford

27 The ABC: Unique Unto ItselfWhy can’t the ABC be managed like a private-sectororganization? Because … well, because … it’s the ABC,of course! John Styles.

28 Drugs: Surrender Is Not A Winning StrategyThe National Secretary of the Australian FamilyAssociation takes issue with John Hyde’s recent Reviewarticle on legalizing drugs. Bill Muehlenberg

30 Further AfieldThere’s money in mould, the effects of imprisoning drugoffenders, Florida mammals and development, corruptionand currency crises, payments for human organs.

32 The Ultimate InsiderWhen respected US media insider Bernard Goldbergblew the whistle on bias within CBS, all hell brokeloose! Don D’Cruz

ARTICLES & REGULAR FEATURES

Inside This IssueVolume 54 • Number 1 • March 2002

Editor: Mike Nahan. Publisher & Executive Director: Mike Nahan. Production: Chris Ulyatt Consulting Services Pty Ltd.Designed by: Colin Norris, Kingdom Artroom. Printed by: Print Hotline, 47 Milligan Street, Perth WA 6000.

Published by: The Institute of Public Affairs Ltd (Incorporated in the ACT) ACN 008 627 727.Level 2, 410 Collins Street, Melbourne Victoria 3000. Phone: (03) 9600 4744. Fax: (03) 9602 4989. E-mail: ipa@ipa.org.au Website: www.ipa.org.au

Inside cartoons by Peter Foster [(03) 9813 3160]

Unsolicited manuscripts welcomed. However, potential contributors are advised to discuss proposals for articles with the Editor.

Views expressed in this publication are those of the authors and do not necessarily reflect the views of the IPA.

Reproduction: The IPA welcomes reproduction of written material from the Review,but for copyright reasons the Editor’s permission must first be sought.

E V I E WR

BOOK REVIEW

2 MARCH 2002

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Reputations are, increasingly, a crucialcommodity. They influence not onlywhat we buy, but how we vote, dress,eat, play and donate. Accordingly,organizations spend huge resourcesdeveloping, massaging, and protectingtheir brand names.

Arguably, Amnesty International(AI) and World Wildlife Fund (WWF)have been two of the most successfulorganizations at the reputation game.

According to a recent survey, AI isthe most recognized and respectedbrand in the developed world. WWF isalso well ranked—much higher thanany commercial organization.

On the back of these reputations,AI and WWF—which both started in1961—have not only grown to besynonymous with their chosen areasof concern, but have become mega-multinationals. While AI does notpublish a consolidated budget, in2000–01, its international head-quarters had revenues of $60 million, aworkforce of over 400 and branches in56 countries. WWF is even larger. In1999, it had a worldwide revenue of$720 million, a workforce of over3,000 and branches in 41 countries.

AI and WWF have a number ofthings going for them. First, they are inthe ‘protecting motherhood’ businesswhich, in this aspirational age, is fareasier than selling cars that mightcrash. Second, they have no peskyshareholders, stockbrokers, journalistsor even governments scrutinizing theiractions. Indeed, they operate in ararefied laissez-faire world of whichcapitalists can only dream.

They must also be given credit fordoing a vital job and doing it well intheir early days. AI established aremarkable network of voluntarygroups around the world to keep aneye on human rights’ violations. AI’srole was particularly valuable duringthe Cold War when Western gov-ernments had little effective leverage

From the EditorMIKE NAHAN

over communist countries. It alsofocused on the actions of undemo-cratic governments.

WWF also played a very con-structive role in its early days. WWFwas formed essentially to raise fundsfor the IUCN and other groups which,in turn, undertook practical con-servation projects, particularly in theThird World—over the last 40 years ithas funded over 11,000 projects. It hasalso led a series of valuable high-profilecampaigns, including saving the panda,the tiger, the elephant, whales andmarine turtles. Although WWFcharacteristically ‘gilded the lily’ in itsearly days, it focused on real problemsin crucial areas and did so with somescientific backing. Importantly, WWFgenerally avoided demonizing cor-porations and capitalism. Indeed, itgenerally sought to partner multi-national corporations, which nowprovide it with a major source of itsfunding.

Somewhere along the line, how-ever, both organizations (or sections ofthem at least) have lost the plot.

Adrian Karatnycky and ArchPuddington—from Freedom House, anadvocacy centre for democracy andfreedom—outline how AI and itscolleagues in Human Rights Watchhave lost touch both with their rootsand with reality, and joined the anti-American chant. (See ‘The Human-

Rights Lobby Meets Terrorism’ on page6 of this issue.) AI now claims, amongother silly things, that the US is asgreat a violator of human rights as theHutu in Rwanda and China in Tibet.

WWF has also lost the plot. Back in1998, the Great Barrier Reef and othercoral reefs around the world werebeing hit with an outbreak of coralbleaching. WWF immediately saw it asa fund-raising opportunity andlaunched a worldwide campaign to savethe Great Barrier Reef. While thecampaign raised huge amounts ofmoney, it ran into a big problem: thebleaching stopped, the coral recoveredand the cause turned out not to beglobal warming, as WWF claimed, butthe naturally warming and cooling cycleof El Niño. The ethical thing would havebeen be to reallocate the funds toreefs that are actually under threat(such as many of the reefs in Asiawhich suffer from fish bombing) or toscientific research (say, on therelationship between global warmingand water temperature). Instead, WWF,while maintaining the fiction aboutbleaching and global warming, shiftedits focus to a new supposed demon—agriculture. As outlined by Gary Johnsand Jennifer Marohasy (‘WWF Says“Jump!”, Governments Ask “HowHigh?”’, page 3), WWF is now wagingan effective PR campaign against thesugarcane industry by claiming that it isdestroying the Great Barrier Reef.Once again there is no scientific basisfor their claims. In reality, WWF isdestroying people’s livelihood whileoffering no protection to the reef.

How do groups such as WWF andAI maintain such good reputationswith such feral behaviour? Well, take aread of the article by Graeme Good-ing (‘The Age and Bias’, page 11) aboutenvironmental reporting in theMelbourne Age—it goes a long way toproviding an explanation.

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THE World Wide Fund forNature (WWF) hasmounted a campaign thathas lead to both the Com-

monwealth and Queensland Gov-ernments recommending urgent andsignificant changes to land manage-ment practices in catchments thatdrain onto the Great Barrier Reef. Itis alleged that there is evidence forlocalized deterioration on nearshorereefs from agricultural run-off. Thescientific literature, however, pro-vides no such evidence. So, what,and who, made these two govern-ments jump to the wrong conclu-sions?

WWF has targeted rural industriesin Queensland over the past two years.This campaign is believed to have beenassisted by funds from the UnitedStates of America through donationsgenerated in response to media interestin the 1998 coral-bleaching episodethat affected reefs across the world.WWF capitalized on the wide mediacoverage and secured significant fundsto pay for a campaign to ‘Save theGreat Barrier Reef’. In 1999, it estab-lished headquarters in Brisbane and asimple media strategy was developedwhereby the Reef would be portrayedas a victim of industry, in particular thegrazing and sugarcane industries.

CREATING A NEED FORGOVERNMENT ACTIONIn June 2001, WWF published a GreatBarrier Reef Pollution Report Card. Theprincipal conclusion was that ‘theGreat Barrier Reef is being threatenedby land-based pollution. Inshore reefsand seagrass meadows, habitat for the

JENNIFER MAROHASY AND GARY JOHNS

WWF Says ‘Jump!’,Governments Ask ‘How High?’

threatened dugong and green turtle,are suffering from what we do on theland’. Imogen Zethoven, WWF Aus-tralia’s Great Barrier Reef campaignmanager said that 750 inshore reefswere at risk from land-based pollution,chiefly agricultural run-off.

The report indicated that the cattlegrazing industry contributed signifi-cantly to the sediment load while thesugarcane growing industry was prin-cipally responsible for pollution frompesticides, herbicides and nutrients.While the report made many allega-tions of reef impact from agriculture,it did not substantiate any of the

claims. Claims of scientific consensuswere made without citing a singlepublished reference. The report citedno studies that provide documentedevidence of a human-induced impacton the Reef.

The WWF report plays on thecurrent global preoccupation withwhat Bjørn Lomborg, in The Skeptical

Environmentalist, labels the ‘Litany’:that the environment is in poor shape,resources are running out, the air andwater are becoming more polluted, andindustries must be heavily regulated.The Litany pays lip-service to theconcept of ecologically sustainabledevelopment, but in fact pays no regardto the sustainability of industry.

The Great Barrier Reef MarinePark Authority issued a media state-ment on the same day that the WWFreport was released with the Author-ity’s Chair commenting that ‘the reportwill raise awareness of the issuesaffecting water quality in the MarinePark’. The Queensland Premier usedthe report as an opportunity to criticizethe Commonwealth Government forits lack of bipartisan support inprotecting the Reef. Interestingly, alocally based conservation group withan established reef-monitoring pro-gramme, the Cairns and Far NorthEnvironment Centre, disputed theWWF allegations. Geoff Weir, theconservation group’s reef-monitoringcoordinator, stated, ‘People are sayingthe Reef is not as good as it used to bebut so far that’s been based on anec-dotal evidence’.

The launch of the WWF documentwas planned to coincide with a meet-ing of the Great Barrier Reef Minis-terial Council on 8 June 2001. At themeeting, the Council established ascientific working group, with thecharter to review the available dataand existing national water qualityguidelines and to prioritize catchmentsaccording to the ecological risk presentto the Reef. Three months later, theCommonwealth Environment Minis- ▲

‘[We] base our work on sound science.’WWF Vision Statement 2002

While the [WWF’s]

report made many

allegations of reef

impact from

agriculture, it did

not substantiate

any of the claims

4 MARCH 2002

E V I E WR

ter released the Great Barrier ReefWater Quality Action Plan. This docu-ment focused on pollution fromagriculture and concluded that ‘Arange of pollutants are evident inmeasurable quantities in river outflowsand these are causing the continueddecline of inshore ecosystems of theReef’.

The Queensland Governmentresponded to pressure from the WWFcampaign by establishing a ReefProtection Taskforce with terms ofreference that included, ‘[to] advise theQueensland Government on processesfor establishing appropriate waterquality goals and targets to protect theGreat Barrier Reef World HeritageArea’ through the development of aReef Protection Plan. The focus of theReef Protection Plan was to ‘reduce theimpacts on the Great Barrier Reef ofland based sources of nutrients, sedi-ment and pollution’.

EVIDENCE OF IMPACTS FROMAGRICULTURAL POLLUTIONON THE GREAT BARRIER REEFRepresentatives on the Reef Protec-tion Taskforce asked that the currentlevel of scientific understanding onimpacts of terrestrial run-off on theReef be provided to the Taskforce. Thescience representative on the Task-force co-ordinated the development ofa science statement in consultationwith experts at the CRC Reef ResearchCentre, Department of Natural Re-sources and Mines, and James CookUniversity.

The first science statement wasdeveloped for the Taskforce to providea ‘consolidated view of our currentunderstanding of the impacts ofterrestrial run-off on the Great BarrierReef World Heritage Area’. Further,‘the statement seeks to allay concernsthat there are conflicting views in thescientific community’. This documentdiscussed threats to the Reef, butprovided no reference of actual damageto the Reef.

Several Taskforce members notedthis fact, with the following commentsbeing made by Taskforce members atthe meeting on 12 November:

‘So the widespread impact [of ter-restrial run-off] is not substan-tiated.’‘But the scientists have tried veryhard to prove there is an impact.’‘Let’s not get hung up on thescience.’‘Let’s go forward on the basis of theprecautionary principle.’

At the insistence of several Taskforcemembers, including the WWF repre-sentative, the science adviser agreedto redraft the science statement. TheCSIRO representative, and senior au-thor of the science statement, said thathe would consult with his scientificcolleagues with a view to redrafting thedocument. The next day a revised sci-ence statement was issued, with thecomment to the Chairman of theTaskforce that ‘We wish to clearlypoint out that whilst there is no evi-dence of widespread deterioration,there is documented evidence of local-ized deterioration on individual near-shore reefs’.

This was the first statement fromreputable scientists clearly alleging animpact from land-based run-off on theReef. The science adviser on the ReefProtection Taskforce and Dr DavidWilliams (Deputy Chief ExecutiveOfficer of the CRC Reef ResearchCentre), when requested, provided DrMarohasy with references to five

published scientific papers and oneunpublished report as the best docu-mented examples of localized dete-rioration on nearshore reefs.

In the view of Dr Marohasy, andProfessor Bob Carter, Marine Geo-physical Laboratory, James CookUniversity, none of these papersprovide evidence that agriculture orother land-based sources of run-off arehaving an adverse impact on the Reef.George Rayment, Principal Scientist,Queensland Department of NaturalResources and Mines, and an authorof the first and second science state-ments, has indicated at least three ofthe papers provide no evidence thatagriculture is having an impact on theReef. Dr Piers Larcombe of the MarineGeophysical Laboratory at James CookUniversity has advised that of the threepapers he has read, none provides anyevidence of land-based run-off impact-ing on the reef. Dr David Williamssubsequently withdrew one of thepapers as evidence.

What the cited papers do is provideevidence that mangrove die-back hasoccurred at least once in one region,that seagrass beds have expanded inat least one region, and that there havebeen changes in the ability of somereef communities to grow coral.Allegations of an impact from agri-culture are made in several of thepapers. However, no evidence ispresented in any of the papers toindicate that the death of the man-groves, the increase in seagrass abun-dance or the changes in coral coverare not part of the normal process ofliving and dying in the biologicallydiverse and dynamic ecosystems of theReef. Two of the papers provideevidence of traces of man-madechemicals in marine sediments alongthe Queensland coast. There is,however, no evidence to suggest thatthese low levels are having an impact,and the source of the chemical has notbeen determined, but is more likely tobe associated with the fishing thanwith agricultural industry.

There is no dispute that post-European land use, including agri-culture, has had an impact on catch-

Governments are

increasingly basing

their actions on

advice provided by

unnamed consultants

or on unrefereed

reports from

government agencies

5MARCH 2002

E V I E WR

ments in which it is undertaken. Post-European land use has potentiallyincreased runoff and sediment associa-ted nutrient and contaminant deliveryto near-shore regions of the Reef areaover the last 150 years. There is alsoevidence for a detrimental impact fromhuman land-based activities, includingagriculture, on freshwater aquaticsystems in some regions. However,there is no evidence of damage to theReef from agricultural pollution. ManyQueensland agricultural producers,including cane growers, have sought toreduce their potential impact ondownstream environments through thewidespread adoption of minimumtillage systems and the adoption ofother best management practices.Consequently, pressures from agricul-ture—and in particular cane growing—are reducing, not increasing.

CURRENT STATE OF THEGREAT BARRIER REEFThe most comprehensive summary ofmajor environmental attributes of theReef, their status and pressures, is con-tained in the State of the Great BarrierReef World Heritage Area. This suggeststhat water quality, mangroves andseagrasses show ‘no obvious adversetrends’. In contrast, birds, marineturtles, dugongs and inter-reefal andlagoonal benthos show ‘decline’ or‘substantial impacts’. Significant pres-sures arise from: human disturbancefrom visitation (birds), by-catch intrawl and shark nets (turtles), huntingboth locally and overseas (turtles), pre-dation of eggs and young by feral ani-mals (turtles), boat strike (dugongs),indigenous hunting (dugongs), trawl-ing (benthos), potentially increasedsediments and nutrients in run-off (in-ter-reefal and lagoonal benthos—nearshore communities only).

The abstract from the most recent,peer-reviewed assessment of the Statusof Coral Reefs of Australasia: Australiaand Papua New Guinea, states, ‘Aus-tralia’s coral reefs … are generally ingood condition … They are wellprotected from the relatively low levelof human pressures resulting from asmall population that is not dependent

on reefs for subsistence. An extensivesystem of marine protected areas isbeing implemented; the best known ofthese is the Great Barrier Reef MarinePark (which is also a World HeritageArea). This is the largest marineprotected area in the world and servesas a model for the establishment ofmany other similar multi-user areas.The monitoring programmes on theGreat Barrier Reef are also probablythe largest and most extensive in theworld’.

POLITICS AND SCIENCEIt is understood that the WWF ReefCampaign has helped generate over7,000 new supporters in Australiaalone during 2001. The increase inWWF membership has come at theprice of undermining community con-fidence in Queensland agriculture, inparticular sugarcane growing and beefgrazing. The beef grazing industry hasbeen worth $2.5 billion annually indirect earnings to the Australianeconomy over the last two years. Thesugar industry is worth $1.6 billionannually in direct income to the Aus-tralian economy and the total outputvalue of the industry and associatedservices would be approximately $2.9billion. Both industries are major con-tributors to Queensland’s economyand underpin the economic stabilityof many rural and regional communi-ties.

The Reef Campaign has also comeat the price of undermining scientific

integrity. According to ProfessorCarter of James Cook University, ‘oneof the relatively new problems thatfaces us is that governments areincreasingly basing their actions onadvice provided by unnamed con-sultants, or on unrefereed reports fromgovernment agencies, some of whichare not even released into the publicdomain. This is a recipe for disaster.Good science operates on a consensusbasis, using material that has beensubjected to rigorous peer review andpublished in journals of internationalstanding. It is therefore at their ownperil that democratic governmentsattempt to “control” the scientificprocess for political ends.’

It is a dereliction of duty forgovernments to devise standards forwater quality and run-off regimeswithout direct studies of impact. Thatsome scientists would play along withthem suggests that politics and scienceare no strangers. The issues could havebeen resolved if governments had beenprepared to scrutinize the evidence inthe published scientific literature.Governments, however, appear in-creasingly reluctant to assess inform-ation independently. Instead, theyhand the referee’s whistle to self-interested aggrandizers such as WWF.

WWF may have played a useful rolein saving the Panda from Mao’s China,and the Siberian Tiger from theSoviets. But the Great Barrier Reef isarguably the best-protected coral reefin the world. The reason WWF sug-gests otherwise has more to do withraising its profile than protecting theReef. The irony is that many reefs inthe near north around Indonesia areunder threat. As for the Australiancampaign, WWF adds no value what-soever to the science, awareness, orprotection of the Reef. Two govern-ments and a string of agencies alreadyregulate activities within its vicinity.

Dr Jennifer Marohasy is Environment Managerwith Queensland Canegrowers Organization Ltd.

Dr Gary Johns is a Senior Fellow with theInstitute of Public Affairs Ltd.

As for the Australian

campaign, WWF

adds no value

whatsoever to the

science, awareness,

or protection

of the Reef

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IN the months since theSeptember 11 terrorist attacks on the UnitedStates, the world’s two lead-

ing human-rights organizations—Am-nesty International and Human RightsWatch—have been very busy. And sothey should have been. Internationallaw, to which these organizations arecommitted above all things, recognizesterrorism as a distinct and uniquelymalevolent form of aggression againstcivilians; and the attacks themselvesassuredly constituted a massive andhorrendous violation of human rights,unprecedented in the history of theUnited States.

Yet, from the steady stream ofreports, statements, and open lettersthe organizations have sent to leaderslike President Bush and UN Secretary-General Kofi Annan, one learns littleof this. Although both AmnestyInternational and Human RightsWatch have issued denunciations ofthe attacks on the World Trade Centerand Pentagon, not once have theyspoken about the precise nature ofthese vicious acts, or called them bytheir proper name: terrorism. Theyhave raised many concerns, to be sure,but terrorism itself has not been partof their agenda.

To understand what is going on, ithelps to have some idea of how mostof the human-rights community hastreated this question in general inrecent years—and also how it hastreated the United States of America.

The Human-Rights LobbyMeets Terrorism

ADRIAN KARATNYCKY AND ARCH PUDDINGTON

IT TURNS out that the organizations’reluctance to use the word ‘terrorism’is not new. One can examine the hun-dreds of documents that Amnesty In-ternational has issued over the yearson countries and regions victimized byterror, from Colombia and Kashmir toSpain and Great Britain, without everencountering a straightforward refer-

ence to the term. Instead, one reads of‘brutal’ or ‘horrific’ acts, or of ‘violentassaults’—phrases that could apply aseasily to the aggression of one armyagainst another as to the deliberatemurder of civilians by political or reli-gious extremists.

Occasionally, human-rights organ-izations have resorted to almostcomical euphemisms. In speaking of

the ‘war on terrorism,’ Human RightsWatch has preferred to describe it asthe ‘war against indistinct enemies.’ Asfor those cases when the word simplycannot be avoided, Amnesty Inter-national has invariably placed it inquotation marks, thus implying its ownscepticism.

Pressed to explain this policy ofevasion, spokesmen for major human-rights organizations argue that the term‘terrorism’ lacks a clear definition ininternational law—which happens notto be the case. There are, in fact,several UN-sponsored agreements,including the International Con-vention for the Suppression of TerroristBombings, that speak forthrightly ofterrorism as a distinct and widelyagreed-upon category of aggression. Abetter explanation can be found in thehuman-rights community’s profounddistrust of the governments around theworld that face a terrorist threat—andin the reluctance to acknowledge thatsecurity is essential to any meaningfulidea of freedom.

It seems that, whatever havocterrorists may wreak on a society, themore serious human-rights problem inthe eyes of Amnesty International andHuman Rights Watch lies in themethods that public authorities haveadopted to combat these ‘indistinctenemies.’ Nowhere has this attitudebeen more pronounced than in the wayhuman-rights groups have treated thechallenge posed by radical Islam,which everywhere has resorted to

Major human-rights

organizations argue

that the term

‘terrorism’ lacks a

clear definition in

international law—

which happens not

to be the case

In this article, Adrian Karatnycky and Arch Puddington discuss the response of human-rightsorganizations, including Amnesty International and Human Rights Watch, to the terrorist attacks ofSeptember 11. They look at how most of the human-rights community has treated the question of

terrorism in general in recent years, and also how it has treated the US.

7MARCH 2002

E V I E WR

terror as a basic tactic. In a revealingstatement, Kenneth Roth, the directorof Human Rights Watch, observed lastMay that ‘violent Islam [today] is theCommunism of ten years ago.’ By thishe appeared to mean not only thatradical Islam was a spent force, likeSoviet Communism in 1990, but thatapprehensions about it were greatlyexaggerated, and as likely as not werebeing invoked by governments only asan excuse for repression.

IS THIS true? Let us consider, to be-gin with, Algeria and Uzbekistan, twoplaces whose governments have beenruthless in dealing with violent Islam.

For most of the past decade,Algerian society has been brutalizedby a fanatical and murderous move-ment of Islamic extremists. Islamicguerrillas have routinely invadedvillages deemed unsympathetic totheir cause, slaughtering an estimated100,000 men, women and children.The response of the Algerian gov-ernment has been, by any measure,ferocious. It has tortured or killed itsenemies and harassed or imprisonedjournalists and public figures who havecriticized official policies.

From the standpoint of humanrights for Algerian society as a whole,however, there can be no doubt thatthe triumph of the government ispreferable to the triumph of itsterrorist adversaries. Yet the over-whelming thrust of the criticism issuedby the human-rights lobby has beendirected at that government. Far moreimportant to these groups than theextraordinary death toll exacted byterrorism has been the state’s un-willingness to prosecute abusivemembers of its own security forces.Missing, too, from the analysis of themajor human-rights groups has beenany acknowledgment that the Alger-ian government, having vanquished aformidable enemy, is moving graduallytoward national reconciliation and therelaxation of state control.

A similar myopia has afflicted theorganizations’ treatment of Uzbekis-tan, a country with its own deplorablerecord of human-rights violations.

Uzbekistan’s president, Islam Karimov,is one of Central Asia’s most pitilessstrongmen, having retained power byjailing and torturing peaceful politicalopponents and making others ‘dis-appear.’ His crimes have been chron-icled and denounced by human-rightsinvestigators with justifiable regularity.But Karimov has also used the sametactics against threats to his power ofan entirely different sort.

The most fearsome of these threatshas come from the Islamic Movementof Uzbekistan, a radical guerilla groupthat, with the assistance of the Talibanregime in Afghanistan, has sowedterror not just in its own country but

throughout Central Asia. Uzbekistanhas also seen the emergence of theParty of Liberation (Hizb-ut-tahrir), afanatical Islamist group that operatesthrough secretive five-man cells inmore than a dozen countries, in-cluding Great Britain and Germany(where it is likely to have influencedMuhammad Atta and the other hi-jackers who attended German uni-versities). Avowed supporters of theTaliban and Osama bin Laden, mem-bers of the Party of Liberation rejectdemocracy, religious freedom, humanrights, and participation in politicalinstitutions they consider tainted byunbelief. If they have not yet joined

the armed opposition in Uzbekistan,it is because their tenets permitviolence only when there is a like-lihood of overthrowing the ruler.

Predicably, President Karimov hasresorted to repression against the Partyof Liberation and has jailed many ofits followers without a semblance ofdue process or fair trial. In theirassessments of Uzbekistan, however,both Amnesty International andHuman Rights Watch treat thesejailed Party of Liberation members notas would-be terrorists but as prisonersof conscience. They are routinelydescribed as nothing more than ‘piousMuslims,’ ‘men who prayed at homeor in small private groups,’ ‘non-violent religious Muslims,’ or ‘thosewho belonged to unregistered Islamicorganizations.’ Entirely lacking is anyserious description of the ideology ofthe Party of Liberation, its clandestinemethods, or the danger that it mightpose.

SINCE ALGERIA and Uzbekistan areviolent and autocratic regimes, it maynot be surprising—but it is deplor-able—that the human-rights commu-nity should have declined to recognizetheir legitimate security concerns. Inboth situations, the task is to choosebetween the lesser of two evils, whichis hardly these organizations’ forte.What, then, about the one case—Is-rael—in which a genuinely open anddemocratic society has also long con-fronted a threat to its survival from Is-lamic terrorists?

In recent years, the major human-rights organizations have been forth-right, it is true, in denouncing the mostheinous attacks committed by Pales-tinians. The suicide bombing of a busypizza parlour, or the ambush of a schoolbus filled with children—these areunacceptable in their view, even ifsuch acts, too, have never beendescribed as terrorism. But theseacknowledgments of barbarism are theexception. In report after report, theburden of responsibility for the vio-lence, upheaval, and killing in theArab–Israeli conflict, particularlyduring the intifada unleashed just over

Both Amnesty

International and

Human Rights Watch

treat these jailed

Party of Liberation

members not as

would-be terrorists

but as prisoners of

conscience

▲

8 MARCH 2002

E V I E WR

a year ago, has been placed squarelyon the shoulders of democratic Israel.

Amnesty International andHuman Rights Watch have issuedprotests against virtually every policyadopted by Israel in its effort toprevent further terrorist attacksagainst its citizens. Traffic blockades,border closings that keep Palestiniansfrom reaching jobs inside Israel,restrictions on Bir Zeit University inthe West Bank—all, we have beentold, are violations of one or anotherfundamental human right. As forIsrael’s policy of seeking out and killingPalestinians who have participated interrorist operations—a policy designedto avoid further civilian casualties—this, too, has come under severecriticism.

Indeed, although it is the Pales-tinians who have made an explicitstrategy of drawing civilians on bothsides into the heart of the bloodyconflict, it is the Israelis who, in thereports of these groups, are much morelikely to be blamed for civilian deaths.Thus, Israeli military authorities arecensured for permitting ‘indiscrim-inate’ firing into areas containingPalestinian civilians, while little is saidof the Palestinians’ intentional use ofsuch neighbourhoods as shields fortheir gunmen. Human-rights organiz-ations have paid special attention inrecent years to the use around theworld of child soldiers, especially byirregular forces; but they have saidnothing about the Palestinian practiceof putting children in the front linesof violent demonstrations, a policydesigned to create young martyrs andthus further inflame Palestinian andIslamic opinion.1

The dismaying stand taken byAmnesty International and HumanRights Watch is best symbolized intheir agenda with respect to theleaders of the two sides. Both groupshave called for a criminal investi-gation of Israeli Prime Minister ArielSharon for his role in the killings byChristian militiamen that took placein the Sabra and Shatilla refugeecamps in Lebanon in 1982—killingsfor which Sharon, even according to

his most severe critics, bears onlyindirect responsibility, and which werereviewed some time ago by an inde-pendent commission of Israel’sdemocratic government. And YasirArafat? Somehow, neither of theleading human-rights groups has seenfit to demand his indictment forheinous crimes against humanitycommitted not simply on his watchbut at his explicit direction, extending

back in time for decades, and by nowtoo numerous to catalogue.

IN THE wake of September 11, onemight reasonably have expected Am-nesty International and Human RightsWatch to entertain second thoughtsabout their assessment of Islamic ex-tremism. For, as we have had bitterreason to learn, the comparison ofradical Islam to Communism hasturned out to be in many respects quiterelevant, if not in the sense construedby the human-rights community.

Like its worldwide Communistpredecessor, Islamism functions bycombining the armed struggle of a fewmilitants with a support networkwhose hands reach around the globe.It too presents a major challenge toestablished democracies and an omi-nous threat to governments that areweak or whose grip on power is

insecure. Perhaps most pertinent of all,it employs methods that presentextraordinary challenges to traditionalmilitary or police tactics.

But the major human-rights or-ganizations have in fact not re-considered. To judge by what theyhave said since September 11, theyare far from recognizing the characterof the enemy against which thecivilized world now finds itselfarrayed. Instead, at the core of theirresponse has been a fear not of thatenemy but of the United States, andin particular of the American re-action—or, as many seem to believe,over-reaction—to the events of Sep-tember 11.

Thus, the initial declarations ofAmnesty International and HumanRights Watch focused on expectationsof an upsurge of anti-Muslim hatecrimes here at home, of racial profilingby law-enforcement officials, and ofthe mistreatment of immigrants.Subsequently, the organizations haveattacked the temporary detention ofsuspects without charges and theestablishment of military tribunals fortrying terrorists—both of which theyconsider violations of fundamentalrights. Human Rights Watch has goneso far as to issue a lengthy documentreminding the Bush Administration—to which the news will no doubt comeas a thunderclap—that internationallaw prohibits the torture of prisoners.

To be sure, other commentatorshave raised objections to various anti-terrorism measures introduced by theAdministration. But what disting-uishes the human-rights world is itsinsistence on denouncing each andevery proposal to secure the domesticfront. This apprehension has beenmatched by concerns over the conductof the war in Afghanistan itself, andother measures by the US and its alliesto destroy terror networks.

Initially treating the attack ofSeptember 11 as a problem in lawenforcement, Amnesty Internationalurged President Bush to join with theUnited Nations in ‘bring[ing] thoseresponsible … to justice within theframework of a fair and accountable

Like its Communist

predecessor,

Islamism functions

by combining the

armed struggle of a

few militants with a

support network

whose hands reach

around the globe

9MARCH 2002

E V I E WR

criminal-justice system, and with fullrespect for international standards fora fair trial.’ Amnesty Internationalwent on record opposing the extra-dition to the US of Osama bin Ladenand other terrorists should they becaptured—unless the Administrationcould guarantee that they would notface the death penalty.

Once it became clear that theUnited States intended to use itsmilitary might to hunt down al-Qaedaand remove its Taliban protectors frompower, the human-rights world trainedits spotlight on America’s tactics.Under international law, HumanRights Watch stressed, it was illegalto assassinate Osama bin Laden orother terrorist leaders. The organiz-ation likewise issued several urgentprotests over America’s use of clusterbombs, and, in one rather exoticstatement, warned that the war wasplacing the rights of Afghan womenin special peril because, among otherthings, the head-to-toe burkhas theywere compelled to wear under theTaliban made it difficult for them tomove quickly.

Of particular concern to bothmajor human-rights organizationswere reports of civilian deaths duringthe American bombing campaign.Amnesty International called for ‘animmediate and full investigation intowhat may have been violations ofinternational humanitarian law’arising from US military actions, andit also objected to the Pentagon’sdecision to bomb radio stations thatwere serving as propaganda vehiclesfor the Taliban leadership. This,according to Amnesty International,was insufficient justification forlaunching attacks on ‘civilianobjects.’

At one crucial point in the con-flict, Amnesty International eveninsisted that special monitors beappointed to oversee the transfer ofarms from the United States and othercountries to Northern Alliance com-manders, with a mandate to keep theguns away from commanders deemedunsuitable because of past human-rights abuses.

AFGHAN CIVILIANS did of coursedie from errant bombs in the initialphases of the war; the incidents werewell publicized and, in fact, rare. Butthe reports from human-rights orga-nizations conveyed no sense of thecare that the United States took toavoid targets in civilian areas. Nor didthey bother to acknowledge more gen-erally the other steps taken by theBush Administration to protect andpromote basic rights both here andabroad—at least as far as innocents areconcerned. So relentlessly criticalhave been the world’s two leadingvoices for human rights and the ex-pansion of liberty as to raise a ques-tion about their attitude toward theUnited States itself.

That question is, alas, all too easilyanswered. In the reports published inrecent years by Amnesty Internationaland Human Rights Watch, America

emerges not as the land of the free butas a country where human rights,especially those of racial minorities,immigrants, and asylum-seekers, areroutinely and massively violated. It isthe home of rampant police abuses,execrable prison conditions, and,according to Amnesty International,a ‘culture of death’ because of thebarbaric practice of capital punish-ment. It is a place that has shamefully

refused to sign a number of inter-national human-rights treaties. Andit is a country that, according to asweeping indictment issued in 1999 byAmnesty International, deserves to begrouped with Tibet and Rwanda as atarget of international protest andconcern.

It has become a commonplace tosay that, in matters of foreign policy,‘everything changed’ after September11. Yet for important segments of thehuman-rights world, clearly, nothinghas changed at all. That the principalhuman-rights organizations should besingling out the United States as aninternational scofflaw was repre-hensible enough yesterday. Today, itraises powerful doubts as to theirfundamental sense of judgment, andsays everything one needs to knowabout their political drift.

NOTES1 In yet another example of the

breathtaking double standardthey apply to the conflict, bothorganizations have also endorsedthe ‘right of return’ for Palestin-ians who have left Israel propersince 1948. What they blithelyignore is that most of these Pal-estinians fled at the insistence oftheir own leaders, that hundredsof thousands of Jews were them-selves expelled from Arab coun-tries upon Israel’s creation, and,most of all, that so massive aninflux would threaten, and maybe designed to threaten, the verysurvival of Israel.

This article was first published inCommentary, New York in Janu-ary 2002. It is reproduced withthe permission of the authors.

Adrian Karatnycky is the president of FreedomHouse and the co-author of several books about

Soviet and post-Soviet politics.

Arch Puddington is vice-president for research ofFreedom House and is currently writing a biography

of the trade-union leader Lane Kirkland.

It has become a

commonplace to say

that …‘everything

changed’ after

September 11. Yet for

important segments

of the human-rights

world, nothing has

changed at all

API

10 MARCH 2002

E V I E WR

Michael Gawenda,

Editor of The Age,

has a serious

problem to address,

if he wishes to

maintain the ideals

to which he and his

paper subscribe

MICHAEL Gawenda, Editorof The Age, has stated:‘Journalists have a publicrole. They have the ability

to do serious damage to people. Theyare a prime source of information … ifwe can’t set standards and make surethat information is independent, un-biased, uncontaminated by commer-cial or other interests, then we have aserious problem’.

Mr Gawenda has a serious problemwith The Age’s environment reporter,Claire Miller, who has been a repeatoffender in regard to biased reporting.Moreover, he has failed to address thisproblem despite repeated calls fromindividuals, industry, unions andtimber communities. In recent years,meetings have been convened witheditorial staff to hear these complaints.During these meetings, Age staff haveagreed that Claire Miller had inappro-priately combined her opinion withinnews reportage. Factual mistakes havealso been acknowledged, all too fewof which have been listed in the ‘Wewere Wrong’ column, albeit buried inthe ‘small print’. Some have beensubject to ‘correction’ via follow uparticles.

The latest example is the reportingof the Marysville blockade by a greenprotest group. The protesters’ com-munication plan seemed to be both topresent and to foster a division betweentourism and timber, by claiming thattourism operators opposed harvesting in‘pristine forest’ as it was damaging theirbusiness. Claire Miller wrote two newsstories: ‘Loggers barking up wrong tree,say protesters’ (15 January 2002) and‘Loggers urge action by state’ (24January 2002). Despite clear evidencethat the tourism and timber sectors wereworking co-operatively and that timberharvesting was occurring in regrowth—not pristine—forest, Claire’s reportingfollowed the protesters’ ‘script’.

The Age and BiasGRAEME GOODING

Miller devoted 70 per cent of herfirst article to anti-timber industryviews from a tourism operator and aprotester. The remaining 30 per centof the article included a timber-industry operator, and a spokesman forEnvironment and ConservationMinister Sherryl Garbutt saying that‘the Department of Natural Resourcesand Environment Department hasmade consultation with all stake-holders a priority through the MysticMountains Tourism Association’.

The second article reported that‘About 350 people from as far afieldas East Gippsland, southern NSW andthe Otways attended a meeting inMarysville on Tuesday night’. Thismeeting called on the Victoria Policeand the Department of NaturalResources and Environment to endthe blockade and uphold the right ofworkers to go about their business.The report made passing referencethat ‘representatives from the localtourism body’ were present.

In fact more than 400 peopleattended, none present were fromNSW or the Otways, and the over-

whelming majority were from thelocal region. In any case, the motionsput at the meeting were carriedwithout dissent. Miller later advisedKersten Gentle of Timber Com-munities Australia that her story wasbased on advice from Green activists,who had seen cars with NSW platesparked in the main street near themeeting and a bus—this in a tourismtown with over 1,000 beds! Theimpression she gave was that themeeting was stacked with peoplebrought in from all over the State andfrom NSW. In contrast, the protesters’campaign was presented by The Agereport as being driven by the localcommunity: ‘The community grouphas linked with conservation activiststo organize the region’s first loggingblockade … Marysville residents aresupporting the protesters with foodand equipment’.

The report failed to cover the factthat the tourism views expressed inThe Age were unrepresentative. Infact, the tourism industry in the area,represented by their association,Mystic Mountains Inc, has co-existedwith the timber industry for a century.Last year they established a workinggroup from both sectors and the ForestDepartment to address any conflictsand, more importantly, to work onareas of mutual benefit to grow boththeir industries. They do not supportthe protesters. This was noted inseveral press statements by GraemeBrown—Executive Officer of MysticMountains Inc—during the protestsand at the meeting in Marysville onTuesday 22 January. Mystic Mountainshad convened a special meeting thenight before, which 50 peopleattended. They reaffirmed that theyendorsed the democratic approachthat the two industries have adoptedto address issues and did not supportthe protesters who were, in fact,

11MARCH 2002

E V I E WR

currently harming their tourismefforts. One person voted against theposition taken by the association. TheAge was provided with statements byMystic Mountains, but none of themwas reported.

Claire Miller also misrepresentedthe position of the local Aboriginalgroup which entered the debate,reporting the Green protesters’ claimswithout adequate checking. She wrote:

Timber Communities Australiaalso released a statement by JudyMonk, an elder of the Taungurungpeople, who told the meeting thatthe traditional owners did notsupport the protesters. But pro-testers’ spokesman Dave Marsdensaid another elder, [……], hadgranted written permission for theblockade.

The statement regarding permission‘for the blockade’ is factually incorrect.It would seem permission for a campwas provided on Wednesday 23 Janu-ary without explaining that it was partof the blockade. The Taungurungpeople have provided the followingaccount.

Three women and a child went tothe CDP Aboriginal Centre in Heales-ville on Wednesday 23rd (the day afterthe Marysville meeting), wantingpermission to camp on traditionalTaungurung Land. All the eldersexcept one were away at a gathering.[The name of the remaining elder hasbeen withheld at her request—Ed.]After considerable insistence, a shortstatement was prepared along the linesof: To Whom it may concern, I as asenior elder of the Taungurung Abo-riginal Tribe give permission to set upcamp on traditional Taungurung land.She was unaware that these people hadset up a fort/blockade or protest againstthe industry. They told her that theywanted to camp in a dry creek bed.The woman and other elders believethat these women manipulated thefacts and deliberately hid that theywere anti-logging protesters.

On Thursday night, when theother elders informed her of the realpurpose behind the letter of authoriz-ation to camp, she became so dis-

tressed that she had difficulty breath-ing and needed to go on a respirator.

On the previous Sunday (20 Janu-ary), 11 Taungurung people had visitedthe blockade to find out what it wasabout. They got into a heated debatewith the Greens as they accused themof disrespecting the traditional land-owners. The elders who visited theblockade felt threatened by the beha-viour of the Greens at the blockadeand decided to leave. They contactedthe industry on Monday to see whe-ther or not they could assist, as theydid not agree with the blockade orwith the claims being made by theGreens. This had prompted JudyMonk, on behalf of the Taungurung,to read out a statement at the Marys-ville meeting which noted that:

• they had been consulted over thelast 12 months re logging coupesand believed matters had beendealt with appropriately;

• ‘the logging industry has been a vi-tal component of our survival overgenerations’;

• ‘we are appalled at the lack of re-spect and contact shown to the tra-ditional owners prior and duringthe erection of the blockade by theactivists’;

• they do not support the activists’actions.

This is not the first time that ClaireMiller has sought to downplay or ig-nore Aboriginal support for the cur-rent timber plans and their oppositionto Green groups’ modes of operation.On several occasions, the Moogji Ab-original Council of East Gippsland,based in Orbost, have issued state-ments of opposition to protesters andsupport for the industry. These havebeen published in the local paper butnever reported in The Age. Instead,Claire Miller has given prominence toan individual Aboriginal from anothergroup who opposed logging.

NEWSPAPER ETHICAL STAND-ARDS BREACHEDThe aforementioned and earlier re-ports by Claire Miller have breacheda number of ethical standards.

The Age code of conduct states thatthe ‘overriding principles are fairness,integrity, openness, responsibility anda commitment to accuracy and truth.Sustaining the highest editorialstandards is essential to us retainingthe trust of the community, and thefreedoms and responsibilities affordedto us by the community.’ ‘Staff shouldseek to present only fair, balanced andaccurate material.’

The Media, Entertainment andArts Alliance: Australian Journalists’Association Code of Ethics states thatjournalists will apply the followingstandards: ‘Report and interprethonestly, striving for accuracy, fairness,and disclosure of all essential facts. Donot suppress relevant available facts,or give distorting emphasis. Do yourutmost to give a fair opportunity forreply.’ ‘Do not allow personal interest,or any belief, commitment, payment,gift or benefit to undermine youraccuracy, fairness or independence.’

Clearly The Age has every right topublish Claire Miller’s opinions as wellas those of others with views on theseissues—provided that these do notinclude errors, which has not alwaysbeen the case. Her opinions, however,should not be allowed to cross overinto her news reporting. Nor shouldshe be allowed to selectively excludefacts, to allow language manipulationto occur through the use of words suchas ‘pristine’ and ‘old growth’ (todescribe regrowth) or to use her ‘newsreports’ to present a distorted view to‘market’ the campaigns of Greenprotestors and Green politicians alongwith her own views to Age readersunder the guise of balanced news.

Michael Gawenda has a seriousproblem to address, if he wishes tomaintain the ideals to which he andhis paper subscribe. Inaccurate reportshave the potential to do seriousdamage to people and communities.

Graeme Gooding, a forester by training, currentlyworks for the Victorian Association

of Forest Industries.

API

12 MARCH 2002

E V I E WR

ALAN MORAN

The ‘R’ FilesJumping Jack Flash—It’s a Gas Gas Gas

Australia has vast volumes of natu-ral gas, most of it off the coast inthe remote north. The present gaspipeline network has mainlyevolved on a State-by-State basisand been reliant on governmentseither building pipelines or guaran-teeing prices. This governmentownership/sponsorship model hasproved to be costly and there is nearunanimity that the future is one ofprivate ownership and competition.

There remains considerablescope for expansion of the pipelinenetwork and a good deal of privatesector interest in doing this. Thebiggest threat is regulatory myopia.Regulators are seeking to socializeany potential profit and privatizelosses by setting prices that fail tofactor in the full costs of risks, butentrepreneurs are refusing to buildnew assets that would be hostage tosuch policies. Pipeline builders areeither not pursuing opportunities atall, or else planning under-sizedpipelines with their capacity fullycommitted so that they are beyondthe authority of regulators to fixprices. The result is a lack ofmovement towards a nationalnetwork, high-priced gas and lostdevelopment.

Australia’s massive North-WestShelf gas reserves have long provedpolitically enticing. A quarter of acentury ago, the prospect of pipingthis gas to the eastern states becamea fanatical pursuit of WhitlamGovernment Minister Rex Connor.His bizarre attempts to finance thiscontributed much to the discreditingof that Government.

The accompanying chart showsthe major sources of gas, and the

pipelines in place and projected.Gas is an excellent fuel source

and is somewhat more flexible thancoal as an input into electricitygeneration. Per unit of energy, it isalso a third less greenhouse-gasintensive than coal, a feature thatgas users and producers are not slowto emphasize. And for gas to makegreater inroads into Australianenergy usage means it must grab alarger share of electricity generation.

For many years, there have beenplans to pipe gas down from Papua

New Guinea’s Southern Highlandsinto Queensland. Press reports inFebruary 2002 suggest that theproject, which would cost $3.5billion, is getting closer to fruition.

The pipeline itself has access togas which is virtually free since it isa by-product of petroleum develop-ment, cannot be flared and has noalternative market but Queensland.And the Queensland Governmenthas been most accommodating. Toassist the gas pipeline (and in theprocess mollify its environmentallobby) the Beattie Government hasintroduced a tax on new coal-firedelectricity developments. The taxrequires any electricity seller tosource at least 13 per cent of newelectricity supplies from gas-firedgeneration. Failure to do so subjectssuppliers to a penalty equivalent toa tax of about 30 per cent on theincremental coal-fired electricity.

Even this leaves the pipelinehostage to competitive provision.Other gas is available, and could be

Source: Australian Gas Association

13MARCH 2002

E V I E WR

piped from Bass Strait, from Moombaand even from northern Australia.

THE POLITICS OF GAS AND ITSREGULATORY FRAMEWORKSubsidies and government encour-agement are one thing, but gas de-velopments would offer more prom-ise if the regulatory framework un-der which they operate were to bereformed. In January, during JohnHoward’s trip to the USA, Ameri-can corporate interests expressedconcern about inconsistencies inAustralian energy regulation, incon-sistencies that are affecting invest-ment in Australia.

During 1997, Australian Govern-ments introduced the national GasCode—a stepchild of the Hilmercompetition reforms. Administeredby the Australian Competition andConsumer Commission (ACCC)and the National CompetitionCouncil (NCC), it was designed tobring about fair competition in gas.

The Code itself and its regulatorspay lip-service to the view thatregulation is very much a second-best approach to market com-petition. Even so, supposed ‘marketimperfections’ are almost alwaysinfinite and invariably offer adetermined regulatory authoritycountless opportunities to dream upreasons to intervene in the market.

The result is a regulatory environ-ment that is stifling new develop-ments and morphing the key skillsof gas firms from commercial intopolitical entrepreneurship. In adesire to avoid regulatory oversight,investors are designing pipelines assingle-use facilities. This not onlyreduces pipeline capacity andincrease costs, it also goes directlyagainst the public interest in buildinga national integrated gas network.We are now seeing pipelines spe-cifically designed so that they canavoid regulatory oversight—evenwhere this means additional costsand reduced flexibility.

One of the key criteria in theCode is that a pipeline should beregulated where this ‘would promote

competition in at least one market’.The regulatory authorities alwaysrelate this to the question ofwhether pipeline prices will becheaper under a regulated regime ora market-driven regime that relieson normal commercial interaction.Voluminous reports almost in-variably produce the answer, ‘yes, aregulated price would be lower’.

In the narrow context of a singlepipeline, it would, in fact, beastonishing if a different answerwere possible. Pipeline costs are 95per cent sunk. Once pipelines arein the ground, price reductions willnot force lower output, while the

customers (and gas suppliers) canonly gain by a lower haulage cost.And to justify cutting the price, theregulators can always claim that thepipeliner spent too much in buildingthe asset or underestimated gasdemand, or that future costs will belower. That way, the regulatorsmaintain the charade that they arenot expropriating property rights.

PERVERSE OUTCOMES OFREGULATORY CONTROLSRegulators frequently maintain thatthey are simply administering a re-gime that is fair to users and devel-

opers alike. And with pipelines thatwere built under a regime that gavethem protection from competition,regulating price and access condi-tions is a reasonable quid pro quo.

But here’s the rub! We have nowshifted to a regime where entrepre-neurs are supposed to spot profitableopportunities and step in to meetconsumer needs. For new pipelines,users and producers are both auto-matically winners. If the service isnot provided, users don’t get thebenefit of the cheaper supply ofenergy, either gas itself or gas thatsupplies electricity generation.When pipeline owners observe thatthe regulatory authorities won’tallow them the control that theywant, they cease putting money intonew developments. For, althoughgovernment bodies can force downprices of existing assets, they areunable to force investors to buildnew assets (though the ACCC isseeking such powers).

The industry was, however,encouraged when, in 2001, theAustralian Competition Tribunaloverturned the NCC’s ambitions toregulate Duke Energy’s pipelinefrom Bass Strait to Sydney. Thatpipeline competed head-on with theexisting Moomba-to-Sydney Pipe-line (MSP) and a price war hadalready broken out.

The NCC accepted the Tri-bunal’s decision and MSP thereforesought reciprocal treatment toescape its own regulatory prison. Butthe NCC showed a dogged refusalto give up an opportunity for regu-lation. It hired two Americanacademics to write a report whichsaid that reciprocity was not appro-priate. The academics also showedtouching faith in regulators’ businessskills. They maintained that becausean ACCC draft decision proposedto reduce the price on the MSPfurther than it had fallen in the faceof the competition from Duke, thisproved that the company was goug-ing the market!

In response to the regulatorydecisions, we have two major pros-

Pipeline builders are

either not pursuing

opportunities or

planning under-sized

pipelines with their

capacity fully

committed so that

they are beyond the

authority of regu-

lators to fix prices

▲

14 MARCH 2002

E V I E WR

pective developments that are beingtailored to ensure immunity fromregulatory oversight. One of these,SEAGas, links fields in offshoreVictoria with Adelaide; the other,the Darwin-to-Moomba develop-ment, would fulfil Rex Connor’sdream of bringing gas across thecontinent. The developers in bothcases propose to design the pipes tocater only for pre-booked gas haul-age, so that they escape regulation.This is in spite of the fact that,thanks to pipeline economics, costsper unit carried fall dramaticallywith size (for the Darwin-to-Moomba pipeline, capacity could bedoubled at a cost increment of about30 per cent).

This sort of sub-optimal outcomeis, in fact, the best we can hope forunder the present regulatory ar-rangements. Some major investors,notably AMP, have made it clearthat they will no longer invest inregulated assets, and it is possiblethat, unless greater scope for entre-preneurial action is permitted, wewill revert to the hitherto-abandoned practice of having thegovernment own these assets, usingthe private sector only as a sub-contractor. Such a consequencewould then leave us vulnerable tothe oscillations of grandiose plansfollowed by ultra-conservatismwhich are characteristic of govern-ment business decisions. This isprecisely the sort of outcome thatthe Gas Code and other Hilmerreforms sought to combat!

The Commonwealth Govern-ment has foreshadowed a review ofthe Gas Code. This cannot cometoo quickly. But it would be folly toleave it to an inter-governmentalprocess like the one that created thecurrent Code. An expert reviewmechanism, like that which theProductivity Commission has per-fected, must be the used instead.

Dr Alan Moran is Director, Deregulation Unit,at the Institute of Public Affairs.

API

After Thoughts

The Ansett/Tesna débâcle doeshave one major benefit—it ham-mered another large nail in theIR Club’s coffin.

It is now clear to all that theTesna deal was just anotherrendition of the IR Club waltz.Two tycoons teaming up with theunions to fleece taxpayers andconsumers through the use ofpolitical muscle. The deal wasbased on the Commonwealthforking out $1 billion of tax-payers’ funds and providingprotection to Tesna against itscompetition. And the quid proquo for this largesse was politicalsupport during a tough election—and the consortium provided thisin spades to the Labor Partyduring the last election campaign.As it turned out, it backed thewrong horse. The Coalition wonand did the right thing by refusingto dance the dance.

As a result, the aviationindustry, which has up until nowbeen Club heartland, is now nolonger. Virgin Blue, with itshighly competitive IR arrange-ments, is set to expand and fillthe gap in the discount market—the section of the market that islikely to grow most rapidly.Qantas, which was a foundationmember of the Club, has handedin its membership card. It knowsthat the days of protectednational carriers are over andthat air travel is now a com-modity business. It has seenairlines around the world with

Tesna: One More Nail in the Coffinby MIKE NAHAN

productive workplace arrange-ments such as those at VirginBlue flourish, while airlines witharrangements such as theirs gobankrupt. And it is still fumingfrom the attempts by the unionsas part of the Tesna deal tonobble it.

Thanks to Tesna’s downfall,the public is now more fullyaware that the IR Club exists tohelp its members rather thanthem. Messrs Lew and Fox wereset to become richer. The unionswere set to remain in control ofthe business. All that the publicwas going to get from Tesna wasa big bill, high-priced tickets andan inefficient airline.

The episode is also anexpensive reminder to indus-trialists that unions are no longerin control of the game and arerisky partners.

The biggest hope is that thedébâcle will push the ALP in theright direction. Mr Beazley andMr Crean were central players inthe scam. Even up to the daywhen the scam officially fellapart, the ALP leadership waswilling to do ‘whatever it takes’to get Tesna up. The collapse ofTesna will further highlight thealready unhealthy control thatthe unions have over the ALPand bring forth demands by theelectorate for a divorce.

Whether the Commonwealthcan take advantage of the IRClub’s problems remains to beseen, but Tesna should help.

15MARCH 2002

E V I E WR

EARS after AustralianGovernments took theirViagra competition pills,as prescribed by Dr Hilmer,

they are still confused about what todo with all their energy. Part of theconfusion comes from misinformationabout the interrelationships betweenenergy, Greenhouse and ‘Green En-ergy’. Political correctness alwaysplagues Greenhouse debates in Aus-tralia.

‘Green Energy’, a.k.a. GreenPower, a.k.a. Renewable Energy, a.k.a.Sustainable Energy, is both the greathope of greenhouse advocacies and agreat source of confusion. It is the ge-neric name given to electricity ‘gen-erated from clean, renewable energysources’ such as photovoltaics (solarcells), wind-powered generators,hydroelectric systems or tidal systems.

To assist informed debate, I madea reality check of Greenhouse andGreen Energy, using the official data-bases of the Australian GreenhouseOffice <www.greenhouse.gov.au>

I used only the 38 official ‘SuccessStories’ chosen from 700 industriesand organizations which have signedup to reduce greenhouse emissions.

• Greenhouse Successes have pooraccountability and rigour

Only 17 of the 38 ‘Success’ stories pro-vide the two most fundamental mea-sures of ‘success’—figures of actualgreenhouse gas savings in tonnes andrelated savings (or costs) in dollars.

That 55 per cent of projects canbe labelled a national ‘Success’ with-out such elementary accountabilityengenders scepticism. Even the topGovernment agency, EnvironmentAustralia, gave no dollars or tonnes

Y

Greenhouse and GreenEnergy: Ten Realities

BRIAN J. O’BRIEN

for refurbishment of its 1924 JohnGorton Building being a ‘Success’.

• Many Greenhouse ‘Successes’ are justcommonsense, saving money by re-ducing waste of electricity or fuel

Australia Post encouraged staff to beenergy-conscious, including washingtea cups in a sink rather than in theboiling water unit. The cost saving is$260,000 for an emissions saving of4,000 tonnes of carbon dioxide annu-ally. To put this into perspective, Aus-tralia has to reduce emissions by some50,000,000 tonnes per annum to meetits Kyoto commitment.

Kalari Transport’s success lay inmodernizing its fleet and optimizingits use, saving 885 tonnes. The storyreports removal of bull-bars fromtrucks, but I am advised that after acouple of bad accidents in the out-back, some bull bars have been re-placed. Net cost is not stated.

My favourite Success Story is the‘Smart Building Management’ of the$1 billion Parliament House, Austra-lia [sic]. From 1988 to 1997, the best-practice computerized Building Man-agement System (BMS) did not real-ize that Parliament does not sit for halfof each year. BMS air-conditionedempty rooms of absent Members andSenators.

Now the 1,810 original pneu-matic controllers are being replacedwith electronic controllers to shut offair-conditioning in unused rooms.About 2,000 tonnes and $2 millionare saved annually. The ‘SuccessStory’ stated that 500 units were re-placed. I am advised that in February2002 the number is 900. Australia isindeed a clever country, though per-haps a tad slow.

• Larger Greenhouse Successes mayincur real costs

Shell Coal is now flaring methanefrom the coal seams at Queensland’sGerman Creek, saving 200,000tonnes at a cost of $320,000. Shellcontinues to investigate alternative,commercial use of the waste methane.

The Lifetimes Emissions Savingsproject of Woodside Petroleum re-in-jects greenhouse gases into the Lami-naria-Corallina and Legendre oil-fields, saving a total of 13 megatonnesat a cost of $105 million.

• Few official Greenhouse Successesinvolve Green Energy

We can also use the official SuccessStories to make reality checks on‘Green Energy’. Despite much mediapromotion of Green Energy and de-spite mandated incentives of theCommonwealth Renewable Energy(Electricity) Act 2000, only five of the38 Greenhouse ‘Success Stories’relate to the production of ‘GreenEnergy’.

• Green Energy is often unsustainedand unpredictable

ACTEW invested $2.3 million in ahydroelectric scheme using surplusmains water in the Mt Stromlo area.This cuts carbon dioxide emissions by3,000 tonnes, and produces an eco-nomic return at 7.5 per cent annually.The scheme does not run in summerwhen there is no surplus water.

This Success Story illustrates thelittle-publicized unreliability typical ofGreen Energy.

The term ‘Sustainable Energy’ isdisingenuous, because ‘SustainableEnergy’ is rarely sustained, while itsmost publicized forms—solar power, ▲

16 MARCH 2002

E V I E WR

wind power and hydro—are as unpre-dictable as the weather.

• Few customers of Green Power aresupplied actual Green Power

Actual Green Power from any of the23 eligible Green technologies andsources <www.orer.gov.au> is deliv-ered as ‘renewable energy’ into a grid,or to an end user, or to a retailer orwholesale buyer. Individual house-holds or businesses can pay an addi-tional tariff of about 20 per cent for‘Green Power’, but they will rarely getor use pure ‘Green Power’.

The Sustainable Energy Develop-ment Authority (SEDA) of NSWWebsite <www.seda.nsw.gov.au>states: ‘You can ask your electricitysupplier to source the energy you usefrom renewable sources’. I suggest thatreaders might ‘ask’ for themselves, asa simple test of the rigour of GreenPower governance.

• Green Power statistics may involvecreative accounting

Accredited Green Power products arenow offered everywhere, except inTasmania and the Northern Territory.Out of 15 suppliers, 13 count as ‘cus-tomers’, even those paying only a frac-tion of the full additional tariff forGreen Power. Some count commer-cial firms as ‘customers’ even if theypay only 1 per cent of the tariff.

• Fewer than one per cent of Austra-lian customers are willing to pay evena fraction of the additional tariff forGreen Power, even after four yearsof heavy promotion.

For a national energy debate, oneneeds to know dollars—how manysupporters pay the full Green Powertariff and will continue to pay. Thisnumber is not readily available, butthe nationwide Green Power Website <www.greenpower.com.au> pro-vides public reports to assist account-ability.

Since September 2000, GreenPower Customers have fallen from apeak of 63,000 to about 60,000. InSeptember, October and November2001, new customers were 569, 506

and 400 respectively. There are abouteight million Australian households.

• Collateral costs and Greenhouseemissions of Green Energy are of-ten ignored

Consider the Success of MacquarieGeneration’s Green Energy trial of a5 per cent blend of sawdust and woodshavings in the traditional coal fuelstream at NSW’s Liddell Power Sta-tion in 1999. Macquarie ‘saved’ about4,500 tonnes of carbon dioxide.

A practice common in Green En-ergy accounting is to ignore (a) col-lateral costs and (b) greenhouse gasesemitted in generating Green Power,in this case collecting and transport-ing sawdust and wood shavings. Butthere are darker mysteries.

• No ‘Success Story’ of the generationor use of Green Energy includes proofthat the savings are real, with gen-eration of ‘dirty’ energy replaced bythe ‘saved’ amount

Those commonsense ‘Successes’ suchas Australia Post, where electricity orfuel use was actually reduced, can ob-viously and validly claim a ‘saving’ inreduced greenhouse emissions.

But once Green Power is involved,claims of ‘savings’ must be carefullychecked. Such ‘saved’ emissions canbe real in greenhouse accounts only ifthere is an associated reduction or re-placement in the generation of ‘dirty’power to match the Green Powerused.

For example, Macquarie sold ‘al-most 3,000 Mwh’ of its ‘saving’ of4,760 Mwh of greenhouse emissioncredits to two energy retailers ‘as partof their meeting their NSW retail li-cences’. This opens a window into adark field where my simple physicist’smind is bewildered. The 4,760 Mwhnever existed as a measurable entity.Yet ‘almost 3,000 Mwh’ was sold. Fur-ther, it was sold to meet retail li-cences.

CONCLUSIONMy analyses of realities of Green En-ergy will be examined more completelyin another article, but some already

require an alarm to be sounded ur-gently.

Consider two high-profile SuccessStories. EnergyAustralia ‘supplied allmajor venues for the Sydney 2000Olympic and Paralympic Games.…with 100 per cent renewable energy….’The Olympics are an official SuccessStory, without full costs being disclosed.

Most power was used at night forspectacular lighting displays. Was allthe power to support such peak dis-plays really Green at night, when allsolar power was zero? Was it from windturbines? Clearly not, on balmy nights.Did EnergyAustralia buy the powerfrom other suppliers of Green Power?Or was most power drawn from thebaseload grid, mainly ‘dirty’ power? Ihave been advised that power wasrepaid over one year, but lack details.

The administration and audit ofsuch suites of alleged ‘savings’ from theuse of Green Power must be of awe-some complexity. A new form of ‘cur-rency’, Renewable Energy Certifi-cates, has been created by the Renew-able Energy (Electricity) Act 2000 todemonstrate compliance.

It all seems to my ill-educatedmind like musical chairs played in vir-tual reality. I wonder who will be sit-ting in the last chair in NSW whenthe music stops.

The Office of the RenewableEnergy Regulator <www.orer.gov.au>is carrying out an audit. If Australiaratifies the Kyoto Protocol, suchaudits would also be needed to tallyreal ‘savings’ as credits towards theKyoto commitment, with a rigouraccepted by international scrutineers.

My comments are not intended todisparage innovative technologies orwell-meaning advocacies in AustralianGreenhouse Challenge or GreenPower. But we live in a real world.Blunt, fact-based discussion of such is-sues is both essential and long overdue.

Dr Brian J O’Brien is a strategic and environmentalconsultant, author of many greenhouse analyses

from Postponing Greenhouse (1990) toAustralian Greenhouse Governance: The

Twilight Zone, (March 1999) in<www.atse.org.au/publications/focus>

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17MARCH 2002

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KEVIN DONNELLY

Secret EducationBusiness

Imagine. You are moving to a newcity from overseas or interstate andyou want to know which school willbest meet the needs of your chil-dren.

If you live in England, theanswer is simple. Look at the Officefor Standards in Education(OFSTED) Internet site and youcan search for the name of a particu-lar school and download theschool’s inspection report.

Government-funded schools areinspected every six years and awritten report is made publiclyavailable. The report addressesquestions such as: What sort ofschool is it? How high are standards?How well are pupils taught? Howwell is the school led and managed?

Not only do inspectors evaluatethe school, but schools are alsoidentified as successful or under-performing. In the language ofOFSTED, inspectors have to decide:

… whether or not the school,although providing an accept-able standard of education,nevertheless has serious weak-nesses, in one or more areas ofits work; whether or not theschool, although not identifiedas having serious weaknesses, isjudged to be underachieving.

Unlike schools in Australia, wherethere are no official sanctions or re-wards, English schools are evaluatedand, if found wanting, face the con-sequences. Such transparency is theopposite of the situation in Victoria,for example, where the Govern-ment refuses to rank schools or tomake test results widely available.

In addition to inspectors’reports, it is also possible to search

the OFSTED Internet site to findout how well schools perform innational tests. In primary schools,for example, all 11-year-old studentstake tests linked to the nationalcurriculum.

The test results are then postedon the Internet. Parents can searcha database by postal code, by localeducation authority or by the nameof a particular school. Shownagainst the national average and theaverage grades achieved by the localeducation authority are the gradesachieved by individual schools.

Greater accountability andtransparency are also being forcedon American schools. PresidentBush’s recent national educationbill (to the value of $US26.5billion, 2002) requires state testingin reading and maths for every childfrom grades three to eight.

The bill also provides incentivesfor under-performing schools toimprove. First, under-performingschools receive additional funding;second, if results still do not im-prove, students receive funding topay for private tutoring.

Finally, if particular schoolsconsistently fail to meet the grade,students will be allowed to transferto more successful schools. Again,this is unlike Australia, whereeducation departments and govern-ments allow failing schools to putstudents at risk year after year,without any attempt to address theroot cause of the problem.

Of course, those most to gainfrom keeping Australian parents inthe dark—teacher unions andfaceless education bureaucrats—argue that test results or inspectors’reports should never be released.Public exposure will destroy aschool’s reputation and students’self-esteem.

Education AgendaIn answer to those resisting

change. First, comparing schools isnot simply a matter of comparingapples with bananas. In England,research into how schools ‘value-add’ to student performance is basedon comparing schools with a similarsocio-economic profile.

Thus, schools from a wealthyarea, with good facilities andparents able to afford the extras, arecompared against similar schools,and not against those in lessprivileged areas. Second, makingresults public, in most cases, leadsto under-performing schoolsreceiving additional funding and tostandards improving.

As parents will agree, there isalso the reality that good test results,by themselves, are not the solereason why they might choose oneschool over another. But when suchresults are made public, parents arein a position to make a moreinformed decision.

All Australian departments ofeducation have been collecting dataabout school performance for someyears. State and Territory govern-ments also have the results of literacyand numeracy testing, generally atgrades three and five for all primaryschools, since being introduced overthe last eight to ten years.

In addition, school Year 12school results are also available torank schools. Given the rhetoricabout accountability and empower-ing communities, one wonderswhen the Ministers of Education ofthe State and Territory Laborgovernments will make suchinformation freely available.

Dr Kevin Donnelly is Director of EducationStrategies, a Melbourne-based consulting group.

E-mail:kevind@netspace.net.au

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18 MARCH 2002

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THE success of globalizationand the Western, secularfree-market system havebeen brought sharply into

focus since the events of 11 September.In recent decades, a coalition of

environmentalists, anti-globalizationsocialists, human rights activists, vari-ous church groups and the media havewaged a concerted campaign againstthe very mouth that feeds them. Withthe ‘rise’ of Islam and the attacks onNew York and Washington, a re-invigorated debate has focused onsecularism, free markets, and thesearch for meaning in an economicsystem that apparently does not pro-vide any. Curiously, the Left, with itsanti-empirical, anti-scientific ap-proach to modern-day problems(greenhouse, the environment, GMfoods, immigration, Aboriginal issues,free trade and globalization itself), hasfound a vigorous ally in Islam.

Common to both groups is a dis-taste for modernity, an ignorance andmisunderstanding of the claims of sci-ence and, most importantly, a humandesire to appeal to a higher moral au-thority (either religious or ideological)to provide meaning and direction totheir lives.

With regard to science and objec-tive reality, much has been written.Paul R. Gross and Norman Levittwrote a devastating critique of univer-sities in Higher Superstitions, the Aca-demic Left and its Quarrels with Science.Alan Sokal perpetrated a stunninghoax on cultural studies academicswith Towards a Transformative Herme-neutics of Quantum Gravity. On the Is-lamic side, Pervez Hoodbhoy [Islam andScience: Religious Orthodoxy and theBattle for Rationality, 1991] gives im-

The Secular West and theDangerous Quest for Meaning

ANDREW MCINTYRE

portant insights into why the Muslimworld is averse to science and why it isincapable of producing wealth throughresearch, innovation and technology.Ibn Warraq [Why I Am Not a Muslim,1995] explains clearly why the secu-larization and reformation of Islam isa necessary process if it is to move intothe modern world.

The distaste in many parts of theChristian Church for our secular worldis expressed by various writers. PaulJohnson, in his biography of John PaulII, claims that ‘we have caught our firstglimpse of a totally secularized worldand it has filled us with terror’. Dr

Michael Casey, private secretary toArchbishop George Pell, in his recentbook, Meaninglessness: The Solutions ofNietzsche, Freud, and Rorty, expresseshis profound doubt that we can live ina world without meaning, a world heattributes to an aggressively secular,free-market society. John Hirst, in hisintroduction to the book, also ex-presses concerns about Australia’s‘modern wasteland’.

In a similar vein, John Gray, Pro-fessor of European Thought at the Lon-

don School of Economics and authorof False Dawn: the Delusions of GlobalCapitalism, dismisses Western moder-nity as ‘an era of delusion’. He imag-ines ‘how closely the market liberalphilosophy that underpins globaliza-tion resembles Marxism. Both are es-sentially secular religions’.

Jean-François Revel, the distin-guished French writer [La Grande Pa-rade, 2000] offers an important correc-tive to these misunderstandings fromboth religious conservatives and theLeft:

Another misunderstanding con-cerning liberalism rests on thebelief that it would be, like social-ism, an ideology. Nothing could bemore false, for liberalism never hadthe ambition of constructing aperfect society.… Unlike socialismand communism, liberalism has thecapacity to reform itself and correctits faults.… It is based on experi-ence. It is not an aberration, nor isit a utopia. Because one neverevaluates a utopia.

The irony in all this is that the secu-lar West—in addition to its democ-racy, rule of law, separation of pow-ers, relative absence of corruption,freedom from slavery, poverty andstarvation, universal education, anunderlying merit-driven, open, caste-less and classless society—tolerates, ina way that is unique in human his-tory, almost every conceivable creedand religious group in existence, alongwith nearly every extreme ideologi-cal view imaginable. On a prosaiclevel, put by Victor Hanson [‘WhyThe Muslims Misjudged Us’, CityJournal, 2002], most of those in theMiddle East on a diet of al-Jazeera tele-vision, screaming in the street at the

The irony in all this is

that the secular West

tolerates … almost

every conceivable

creed and religious

group in existence

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The Blair FilesTIM BLAIR

Poverty CausesTerrorism?

Poverty causes terrorism. This mustbe true; after all, so many intelli-gent, educated people believe it.

CNN founder Ted Turner an-nounced in February that ‘the rea-son that the World Trade Centergot hit is because there are a lot ofpeople living in abject poverty outthere who don’t have any hope fora better life’. South African Presi-dent Thabo Mbeki told the UnitedNations last year that poverty‘breeds a deep sense of injustice’.Argentina’s then-President Fer-nando de la Rua said last Novem-ber that ‘unequal distributioncauses frustration and despair’.(Unfortunately for Fernando,Argentina’s very equal distributionof unemployment and debt forcedhim to resign one month later.) ‘Atthe bottom of terrorism is poverty,’declared South Korean PresidentKim Dae-jung. And Bishop Des-mond Tutu claimed that ‘externalcircumstances such as poverty anda sense of grievance and injusticecan fill people with resentment anddespair to the point of desperation’.

Problem is, it’s almost impos-sible to find an actual poor terror-ist. Osama bin Laden is worth morethan the combined annual earn-ings of the people his goons killedin the WTC. The goons them-selves were middle-class; in his fi-nal telephone conversation withhis father, September 11 terroristZiad Jarrahi was promised a new carwhen next he returned to Lebanon.

Mere facts shouldn’t destroy ourfaith in the poverty–terror nexus.‘The suicide bombers of Septem-ber 11 appeared not to come from

poor countries,’ Britain’s Interna-tional Development SecretaryClare Short told the BBC. ‘But theconditions which bred their bitter-ness and hatred are linked to pov-erty and injustice, there is nodoubt’.

Oh yeah, Clare? In fact, thebitterness and hatred of most mod-ern terrorists are more usuallylinked to wealth and education.

Bill Ayers was the son of a Chi-cago bank executive. He grew upto become a member of the bomb-happy Weather Underground,spouting lines like: ‘Kill all the richpeople. Break up their cars andapartments’. He could have startedwith his fellow members: anotherWeatherman, Silas Trim Bissell,was grandson of the Bissell carpet-cleaning founder. (By the way, thesame area of California thatspawned most Weather Under-ground members also gave us JohnWalker Lindh, son of a rich lawyerturned bin Laden warrior.)

Italy’s murderous Brigate Rossewas founded in 1970 by studentswho thought it cute to fomentrevolution in Milanese car facto-ries. They’d drop by, yell someMarx at the puzzled workers, thenslouch off to their afternoon lec-tures. Well, that’s how thingsstarted; by the early 1980s the RedBrigade had killed nearly 400people.

Ulrike Meinhof, second bananain Germany’s Baader-MeinhofGang, was born to a fantasticallyrich Hamburg family. In nine years,she and her commie comradeskilled 31 people, most of thempoorer than Meinhof herself.

Notoriously impoverished1970s Japan saw the rise of theJapanese Red Army, led byAPI

Great Satan, actually desperatelywant all those things the West pro-vides.

How does the West, then, defenditself against this informal alliance ofenemies of secularism? Way back in1959, CP Snow [The Two Cultures andthe Scientific Revolution] clearly under-stood what was at stake:

There is a moral trap which comethrough the insight into man’sloneliness: it tempts one to sit back,complacent in one’s unique trag-edy, and let the others go withouta meal.… As a group, the scientistsfall into that trap less thanothers.… If the scientists have thefuture in their bones, then thetraditional culture responds bywishing the future did not exist. Itis the traditional culture, to anextent remarkably little dimin-ished by the emergence of thescientific one, which manages theWestern world….If we forget the scientific culture,then the rest of Western intel-lectuals have never tried, wanted,or been able to understand theIndustrial Revolution, much lessaccept it. Intellectuals, in particu-lar literary intellectuals, are naturalLuddites.… For, or course, onetruth is straightforward. Indus-trialization is the only hope of thepoor.

We simply have no choice. The ca-tastrophe of the Muslim world (inHanson’s view) and the problem forthe Left and to some extent varioussects of the Christian Church in theWest, is their failure to grasp thenature of Western success. To rejectour world because it provides no evi-dence for, or utility in, arbitrary orirrational belief systems—beliefswhich indeed impede the rationaldecision-making and consensus atthe heart of secular liberal progress—could mean a return to an infernalnew barbarism and primitivism thatdoes not bear thinking about.

Andrew McIntyre is Public Relations Manager atthe Institute of Public Affairs

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teacher’s daughter Fusako Shigen-obu. Her group had to go offshoreto find injustices; in 1972, at Israel’sLod Airport, JRA operatives killed26 tourists.

But wealth and education bythemselves do not terrorists make,otherwise the Young Liberalswould be smuggling Semtex in-stead of guzzling champagne, andSydney’s Palm Beach would be ahotbed of revolutionary fury. Someother ingredient is required beforethe money/university mix becomesvolatile.

That ingredient is stupidity.Blind, wilful stupidity.

Examine any terrorist group andwithin minutes you’ll encounterspectacular dumbness. TheWeather Underground took theirname from a Bob Dylan lyric—lucky they weren’tfounded duringthe disco era;they’d have beenknown as theShake YourGroove ThingCollective—andspecialized in ac-cidentally blow-ing up themselves,rather than theirenemies.

The Symbion-ese LiberationArmy chose as itsfirst victim Mar-cus Foster, a blackCalifornia schoolsuperintendent. His crime? TheSLA believed he wanted highschool kids to carry ID cards.

Those Symbions didn’t readmany newspapers. Foster had with-drawn his support for the ID planby the time he was murdered.

The moron Meinhof shouldhave become a publishing tycoonbut was too stupid to realize she’dstumbled upon a dynamite maga-zine idea. In the early 1960s she wasappointed editor of konkret, aboring political journal secretlyfunded by East German com- API

In fact, the

bitterness and

hatred of most

modern terrorists

are more usually

linked to wealth

and education

munists. When the communistswithdrew their cash in 1965, a des-perate Meinhof added pornographyto konkret’s drab sociopolitical text.

Sales soared. Meinhof had un-wittingly hit on a formula we seeechoed today in magazines likeblack + white, right down to thelower-case title. Instead of stickingwith her job, Meinhof hooked upwith Baader, and ended up killingherself in gaol.

Two years ago, after decades onthe run, the JRA’s Fusako Shigen-obu crept back into Japan, believ-ing her false name and changedappearance made her safe. ButFusako didn’t alter any of herstrikingly individual mannerisms,such as smoking a cigarette asthough it were a pipe, and con-tinuously exhaling smoke rings. ‘It

was that littlesomething thatgot her,’ a policespokesman toldthe Japanesepapers.

You don’tneed to go to Ja-pan or the USor Lebanon tofind delusionalzeal. In the Mel-bourne studenthouse I sharedwith variousleftists duringthe early 1980s,I was one day

denounced for reading The Age’ssports pages before turning to thefront. Such distractions, I was told,would ‘delay the revolution’.

None of my firebrand house-mates ever became revolutionaries,however. Perhaps they weren’t richenough.

Tim Blair is a Sydney-based journalist, who was aformer writer for Time Magazine, an ex-columnist at

the Daily Telegraph, and editor of Sports Illustrated.

Notable QuoteReality versus Myths

Bjørn Lomborg

It is crucial to the discussionabout the state of the world thatwe consider the fundamentals.This requires us to refer to long-term and global trends, consid-ering their importance especiallywith regard to human welfare.But it is also crucial that we citefigures and trends which are true.This demand may seem glaringlyobvious, but the public environ-ment debate has unfortunatelybeen characterized by an un-pleasant tendency towards ratherrash treatment of the truth. Thisis an expression of the fact thatthe Litany has pervaded the de-bate so deeply and for so longthat blatantly false claims can bemade again and again, withoutany references, and yet still bebelieved. Take notice, this is notdue to primary research in theenvironmental field; this gener-ally appears to be professionallycompetent and well balanced. Itis due, however, to the commu-nication of environmentalknowledge, which taps deeplyinto our doomsday beliefs. Suchpropaganda is presented by manyenvironmental organizations,such as the Worldwatch Insti-tute, Greenpeace and the WorldWide Fund for Nature, and bymany individual commentators,and it is readily picked up by themedia. The number of examplesare so overwhelming that theycould fill a book of their own.

Bjørn Lomborg, The Skeptical En-vironmentalist: Measuring the RealState of the World, CambridgeUniversity Press, 2001.

‘

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21MARCH 2002

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KEN PHILLIPS

IR Works AgainstWorkers

Generally, we are expected to believethat the Australian industrial rela-tions system exists to protect workersfrom the evil effects of ‘market forces’.Such moral posturing maintains thatif wages weren’t regulated, free mar-kets would push down wages to cre-ate more profit for greedy bosses. Infact, this proposition masks the re-verse intent of the industrial relationssystem, namely, to control and sup-press workers’ wages. The IR systemhas more to do with the state seekingto protect employers from high labourcosts than it does with the protectionof workers’ rights. The trade-off is sup-posed to be more jobs.

This simplistic nineteenth-cen-tury-based analysis of labour econom-ics, however, implodes when com-pared to the reality of labour markets,such as those in the information tech-nology sector.

The IT industry is typified by highlabour costs that find high natural lev-els because market forces prevail. Inthe market for IT labour, even rudi-mentary technicians start at hourlyrates of $40, rising to $100 per hourand more, even on long-term con-tracts. Read any IT magazine and acommon complaint of IT companiesis that they cannot find and retain theIT people they need, and that payrates are out of control. Read the com-ments of IT contractors and their de-sire is to prevent IT companies fromdominating the market or securingregulation that will limit the abilityof contractors to shop around for thehighest price for their services. Evenwith the current slump in the sector,the existence of a non-price-regulatedmarket delivers real financial benefit

to IT workers. And there is a steadystream of people training to enter theIT sector, which has not depressed payrates significantly because of the grow-ing demand for skilled people.

Compare this to what is happen-ing to nurses. For 20 years or more,nurses have suffered from increasingeducational, performance and respon-sibility expectations while their in-comes have been suppressed in ahighly regulated industrial relationsenvironment. The near-monopoly

employer, in this case government,has tried to use the IR system to con-tain labour costs. But the long-termregulation of nurses has finally caughtup with the employer and there is nowa severe shortage of nurses. There areplenty of highly trained nurses—it’sjust that they refuse to work. Theregulated labour market for nurses hassuppressed nurses’ incomes and cre-ated an availability crisis.

As happens whenever markets arerorted, other market mechanismshave moved in to fill the void, in thiscase, with the emergence of a vigor-ous nurses’ labour-hire industry.

What’s A Job?

Nurses register with lots of agencieswhile shopping around for the bestprices. Hourly rates have, as a conse-quence, risen well over the $25 paidunder the award, to above $85 an hourand as high as $150 per hour. This freemarket in nurses has begun to reflectthe rates and dynamics of the IT sec-tor—much to the annoyance of theemployer.

Now a desperate Victorian Gov-ernment has moved to try and depressnurses’ incomes. It wants to destroythe market for nurses and set up a cen-tral tendering agency through whichall nurse placements must occur. Theprimary intent of the employer is toforce nurses’ pay down near the lowaward rates. This regulation route isbeing attempted because nurses havedeserted the industrial relations sys-tem for the free market. The govern-ment is desperate to control the mar-ket for its own budgetary purposes. Tosucceed in this effort, it has appliedto the Australian Consumer andCompetition Commission for exemp-tion from the Trade Practices Act onthe grounds of ‘public interest’.

And before anyone jumps to thedefence of this re-regulation on theneed to contain health costs, first con-template why health system costs areexploding. Is it the fault of the nurses?Or of the employer—the government,which has failed to create an efficientsystem?

Whatever the answer, the keypoint remains strong: labour regula-tion is designed to save employersfrom their own inadequacies by de-pressing the incomes of the peoplewho do the work!

Ken Phillips is a workplace reform practitioner whopromotes the principles of ‘markets in the firm’.

API

The IR system hasmore to do with the

state seeking toprotect employersfrom high labourcosts than it does

with the protectionof workers’ rights

22 MARCH 2002

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S T R A N G E T I M E SCompiled by IPA staff, columnists and consultants …

LAWYERS: SOCIALIZINGPRIVATE PRACTICELawyers have been doing it tough. Thenational competition policy hasstripped them of a number of lucra-tive monopolies, such as conveyanc-ing, and now they face a flood of newgraduates—with the number of peoplestudying law exceeding the numberpractising law.

How have they responded? Well,with outstretched hands. The LawSociety of NSW has launched acampaign to save the bush lawyer,claiming that competition policy isdriving lawyers out of the bush andthreatening the very fabric of ruralsociety. The Society’s solution? Youguessed it: government subsidies—that is, for taxpayers to subsidizelawyers to sit around, in rural areas,for the good of the community.

Somehow we think that they aregoing to have to do better than this.

IT’S A DOG’S WORLDA major conflict is brewing betweenKorea and Australia and it has to dowith dogs and food.

No, not restriction on dog foodexports, but rather restrictions onexport of dogs as food.

Dog meat is very popular in Korea,indeed its consumption is oftenperceived as part of a cultural tra-dition. The trouble is that legally its agrey area—neither food nor pet.

In response to pleas from restaurantowners anxious to popularize theeating of dog meat in the run-up tothe World Cup, Korean lawmakers areworking on a bill which would classifydog meat as livestock.

This, naturally, has dog loversbarking, claiming that ‘Never beforein the history of the world have OURpets been exported for food’. TheKoreans have countered with claimsof cultural imperialism.

The Australian Kennel Councilhas taken the dog by the collar andbanned the export and sale of all dogsto any country where they may beconsumed as food. The AustralianGovernment is now working ondrafting a bill to enforce the ban inlaw.

Will the issue go to the WTO? Willthe dispute threaten our livestocktrade with Korea? Will dog meat be ahit with soccer yobbos?

SPOT THE INCONSISTENCYThe Gallop Government, under thebanner of individual rights, has put abill before the WA Parliament thatwill give teenagers over the age of 16years the right to participate in homo-sexual acts with other consentingadults. This will supposedly allowteenagers to negotiate and exploretheir sexuality without interferencefrom the state or third parties.

The Gallop Government also hasa bill before Parliament, which, underthe banner of protecting youth fromexploitation, will remove the right ofteenagers below the age of 18 years toenter into contracts of employment.That is, the bill will remove theerstwhile rights of teenagers to nego-tiate and explore their work options,and instead hand them over to DrGallop and his mates in the unions todetermine.

THE ORGANIC VISION: BACKTO THE INGLORIOUS PASTThe Institute for Food and Develop-ment Policy (an organic farming lobbygroup) has just released a book on ‘sus-tainable agriculture’ which findsCuba’s agriculture system to be themodel for the world.

Why? Because Cuba uses littlefertilizer, herbicides or machinery, andexports little—in short, because it isstuck in the past.

Somehow we don’t think that evenUncle Fidel would support his organiccomrades. Cuba relies on antiquatedagricultural methods not from choicebut out of necessity; technology hasbeen essentially frozen for over 40years by the enforcement of sanctionsand a lack of money.

Nor should the rest of us supportthis nonsense. As Indur Golkany ofthe Political Economy ResearchCenter stated, ‘Imagine the devas-tation that would have occurred hadagricultural technology been frozen at1961 levels.… Massive deforestation,soil erosion, greenhouse gas emis-sions, and losses of biodiversity wouldoccur with the more-than-doublingof land and water diverted to agri-culture.…’

FISHMONGER SUED FORSELLING FRESH FISHIn a world first, a fish seller in Norwayis being sued for selling fresh fish. Nothis is not a typo. The activists fromPeople for Ethical Treatment of Ani-mals (PETA) have taken actionagainst a fishmonger for selling fishthat were still moving.

Understandably a little perplexed,the fishmonger countered that he wasonly doing what his customers de-manded. Moreover, he reasonablyasked, ‘what is the difference betweena fish dying on ice in his shop anddying on ice on-board a boat?’

The answer from PETA, whose realaim is to stop fishing altogether, is thatit is cruel to kill fish—no mater howor where.

PETA may be a bunch of crack-pots, but with an annual budget of over$50 million and the support of celeb-rities such as Paul McCartney, theycan wipe the floor with any little fishseller in Norway.

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So Joined-up It’sStationary

Changing planes at Paris in the NewYear, I exchanged the French and Bel-gian francs left over from holidays andbusiness trips for crisp and shiny neweuro banknotes and coins. It tookabout one minute. That seems typicalof the introduction of euro notes andcoins in the 12 eurozone countries. Onthe whole, there was very littletrouble—except for retailers, who hadto decide whether to convert (say)DM14.99 accurately but unenticinglyto €7.66, round it up to €7.99 or downto €6.99.

The euro is a done deal. Two of thehold-out countries—Sweden andDenmark—are likely to join beforelong. Only in Britain is it the Europeanissue: everywhere else, the hot topicsare enlargement (how and when toadmit countries such as Slovenia,Cyprus, Poland, and Estonia), and theconstitution (the constitutional con-vention started work in February).

I was in Paris on the way back fromChristmas in WA. It had been just likehome: the newspapers were full of‘hospital crisis’, but local governmentsclearly had buckets of money to spendon traffic calming and fancy paving.

I don’t know what Geoff Gallopsaid, but Tony Blair promised us‘joined-up government’, and hasn’tdelivered it. We’ve got thousands ofhospital beds occupied by people whodon’t need to be in hospital, becausethere aren’t enough nursing home bedsor home help services. Hospitals arepart of the National Health Service,but nursing homes and home help arethe responsibility of local governmentsocial services—who don’t get themoney that’s being spent on chicanesand speed humps by other parts of localgovernment.

Letter from LondonJOHN NURICK

Meanwhile, new regulations onaccessibility and safety are makingthings worse. Many nursing homescan’t afford to widen all their doorways,install new ramps and lifts, and so on,and are closing instead. The amountthe government pays for nursing homeaccommodation is anyway so smallthat, even before the new regulations,many private nursing-home businesseswere worth less than the value of theirassets.

Last year’s foot-and-mouth out-break gives us another example. Itprobably originated with some illegal-ly imported meat (though its rapidspread was due partly to farmingpractices and partly to governmentdelays). Everyone knew that peoplewere illegally bringing meat into thecountry—there were stories of suit-cases dripping blood arriving on flightsfrom West Africa—but nothing wasdone. The port health services—partof local government—don’t havepower to inspect baggage, arrest peopleor impose fines, while Customs—whodo—weren’t interested.

What’s amazing is that more thana year after the outbreak began,nothing seems to have changed. Whenan incoming flight was spot-checkedin February, the BBC reported that300kg of illegal meat had been foundin passengers’ baggage—and that this

was the first such check for ninemonths. They asked an Australiancustoms inspector what he thoughtabout that; he could hardly believe it.

These two examples are from areaswhere central government holds boththe stick and the carrot (central grantsaccount for more than 80 per cent oflocal government funds). Wherecentral government has less power, ordoes not wish to exercise it, joined-upgovernment involves a mass (or mess)of regional agencies, task forces,strategies, and action plans. Forinstance, the European ‘Objective 1’economic development funding pro-gramme for West Wales and theValleys involves the Welsh EuropeanFunding Office (WEFO) and otherWelsh regional agencies; a monitoringcommittee; five ‘regional partnerships’;seventeen ‘local partnerships’; andthree ‘crosscutting themes’. Each hasits strategies, objectives, priorities,action plans, output targets, guidancefor applicants, and axes to grind.

In fact, it’s almost unworkablycomplex and parts of it are way behindschedule. I’m involved with a projectthat’s seeking a few million poundsunder an Objective 1 ‘measure’ tosubsidize ten ‘strategic sites’. Eighteenmonths after the programme started,WEFO had only managed to select onesite. Even if all goes well, there seemsno chance of ‘our’ project receiving anymoney before about March 2003, 30months after first lodging an appli-cation.

Would you ever believe that all thisis meant to encourage entrepreneur-ship and small business?

John Nurick is a management consultant based in theSouth of England. From 1985 to 1990, he was

editorial director of the Australian Institute for PublicPolicy, and later edited newsletters reporting on theUK Parliament and European Union institutions.

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My answer to him then, andto all who ask me, is a heart-felt‘No!’ But the question is ir-relevant. The drug prohibitionpolicy will not prevent my sonfrom becoming a drug addict. Norwill its abolition increase thechances of him doing so.

But if, despite everything, hebecame addicted, then under thecurrent policy my son would havea much higher chance of becom-ing a dead drug addict. And thatis what I would seek to avoid mostof all.

HOW MANY?The Australian Bureau of Statis-tics maintains comprehensive fig-ures on all kinds of aspects of Aus-tralian society, so it is no surprisethat this includes figures on howmany Australians die due to mis-use of drugs. In 1999, opiates (forexample, heroin and morphine)

were significant contributors tothe accidental deaths of 699 Aus-tralian males and 178 Australianfemales. The great bulk of thosedeaths were of people aged be-tween 15 and 50.

Between 1989 and 1999 therate of accidental drug deathsdoubled, from less than five per100,000 to around 11 per 100,000

for males, and from around twoto nearly four for females.Between 1979 and 1999 opiates’responsibility for accidental drugdeaths increased from 31 per centto 63 per cent. Go to:

www.abs.gov.au

Enter ‘Drug-related deaths’ intothe search box at the bottom ofthe page then click the ‘Go’ but-ton. On the resulting list of docu-ments, click the one entitled‘Drug-related deaths’.

A heroin drought over thepast couple of years has likelyreduced the number of drugdeaths since 1999. But recentreports suggest that this is easing,so it is likely that the pile ofcorpses will resume its growth.

ON LIBERTYLaws against drugs are prettymuch an invention of the Twen-tieth Century. But consider thisremark:

[T]he only purpose for whichpower can be rightfully exercisedover any member of a civilizedcommunity, against his will, is toprevent harm to others. His owngood, either physical or moral, isnot a sufficient warrant. He can-not rightfully be compelled to door forbear because it will be betterfor him to do so, because it willmake him happier, because, in theopinions of others, to do so wouldbe wise, or even right. These aregood reasons for remonstratingwith him, or reasoning with him,or persuading him, or entreatinghim, but not for compelling him,or visiting him with any evil incase he do otherwise.… Over him-self, over his own body and mind,the individual is sovereign.

The cynic could well argue thatthe War Against Terrorism, likeother wars, makes a wonderful ex-cuse to impose a range of measuresthat the population of a free na-tion wouldn’t tolerate in ‘peace-time’. So it may not be surprisingthat the longest currently running‘war’, the War on Drugs, has hadjust such an effect.

Before proceeding, I shall stateup front that the rest of thiscolumn is in favour not of decrim-inalization, nor even in favour ofdirecting drug ‘offenders’ awayfrom the criminal justice systemand into medical treatment.Here, I am providing resources forthose interested in discoveringwhy all drug laws should berepealed.

I must hasten to add that thismay not be the official positionof the Institute of Public Affairs(remember, I just write for thispublication—I am not an em-ployee of the IPA). Indeed, thatbody and the Editor of this journalmay find this view repugnant.

Nevertheless, if ever therewere an issue demanding a recon-sideration of public policy, theprohibition on certain drugs issurely one. After all, hundreds ofAustralians in the prime of theirlives die each year under thecurrent policy.

A final personal note: severalmonths ago I briefly discussed theissue with the Executive Directorof the Australian Christian Lobby<www.acl.org.au>, a man with aproud and honourable careerbehind him, and a man who iseminently sensible on manyissues. His response was a one-liner to the effect: ‘Do you wantyour son to become a drug addict?’

Free_Enterprise.com by Stephen DawsonFile View Go Bookmarks Options Directory Window Help

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ingly, it has conducted plenty ofwork on drug prohibition. Theemphasis is on the US policies,but their reasoning is applicableto most Western nations, includ-ing Australia.

It is the illegality of drugs,rather than their inherent proper-ties, that is the cause of themonstrous death toll. Qualitycontrol is minimal, heroin purityis variable (the greater the quan-tity making it into a market, themore pure the street product—the steady trend upwards in purityis a clear indication of increasingsupply). There is a another costlevied by the War on Drugs: thedestruction of lives by grindingthem up in the criminal justicesystem.

The Cato Institute points outthat the cost of enforcementthrough a decade of alcohol pro-hibition came to less than $US1billion (in 1993 dollars). In theUnited States, the Federal Gov-ernment alone spends $US19 bil-lion each year on drug prohi-bition, leading to 1.5 million drugarrests per year and a drug-relatedprison population of 400,000.

Go to:

www.cato.org/current/drug-war/index.html

BLACK MARKET FALLOUTIllegal markets have other effectsbesides poisoning their customersand having both merchants andconsumers sent to gaol. They alsomake for robust competitive prac-tices. When you hear figuresabout the appalling number of‘children’ killed with firearmseach year in the United States, it

is worth remembering that theoverwhelming majority of thoseare members of inner-city gangswho are either defending, or try-ing to expand, their market sharein the drug trade.

The products of illegal marketsare exceptionally expensive(since the selling price must coverunconventional importationroutes, bribes, and premium prof-its to offset the risks), so they be-get crime as addicts attempt toraise the money to feed their hab-its.

How much of an impact doesprohibition have on, say, murder?In Homicide Rates and SubstanceControl Policy, a fascinating studypublished by the IndependentInstitute, it is revealed that outof several control variables, USmurder rates are most closelylinked to drug or alcohol prohi-bition enforcement policies. Goto:

www.independent.org/tii/WorkingPapers/DrugWar.pdf

FEEDBACKI would welcome advice fromreaders on any other sites of interestto IPA Review readers. E-mail meon scdawson@bigpond.net.au.

Free_Enterprise.com by Stephen DawsonFile View Go Bookmarks Options Directory Window Help

This was published in 1869. Ofcourse, it is an extract from JohnStuart Mill’s On Liberty (ChapterOne). This passage should be theend of the argument. Heroin maybe bad for me. Still, what right hasanyone, other than those close tome and upon whose opinion Ihave chosen to place greatweight, to tell me what I shouldor should not do to my own bodyand mind? Is it because by hurt-ing myself I am hurting society?Am I owned by society? If so, thenthose who do equivalent harm tosociety through potential or ac-tual harm to themselves (sky-divers, footballers, gluttons)should be similarly restrained.

The odd thing is that while OnLiberty is primarily a utilitariantreatise, Mill’s argument here isessentially moral. Copies of this

work are scattered all over theWeb. A nicely formatted copy isavailable at:

www.bartleby.com/130

GO DIRECTLY TO GAOLThe Cato Institute, a very promi-nent pro-liberty think-tank inthe United States, is always avaluable source of analysis onpublic policy issues. Not surpris-

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Enroning CapitalismThe collapse of Enron, the seventhlargest company in America, is thebiggest story in the US media afterthe war against terrorism. Unsur-prisingly, critics of a capitalist soci-ety have tried to portray Enron, andespecially its CEO Ken Lay, as theposterboy of a rampant, laissez-fairecapitalism that needs to be regulated.They argue that more controls overcompanies are needed, that cam-paign finance reform is required toremove the influence of such com-panies, and that the privatization ofthe Social Security system would bedangerous. The real message of theEnron affair is the direct opposite:namely, that capitalism works.

Enron was not the free-wheeling,capitalist enterprise portrayed by themedia. It sought to use politicalpower to engineer the market in itsfavour, a classic example of whatpublic choice economists call ‘rent-seeking’. It tried to rig the so-called‘deregulation’ of the energy marketsby advocating the banning of elec-tricity utilities from the generationmarket, price controls on access totransmission grids, and control of theelectricity distribution systems bygovernment officials. Rarely men-tioned in the media is the fact thatEnron was an active supporter (andthereby a quiet contributor to theGreen movement) of the US’ssigning the Kyoto agreement onglobal warming, in order to cripplecoal as a competitor. The BushAdministration wisely refused to signthe declaration that would havedevastated the US economy. (SeeIPA Review, June 2001.) Enron wasmore successful in obtaining $1.5billion in subsidies for investmentsabroad from the Clinton Admin-istration.

Letter from AmericaNIGEL ASHFORD

Congress is likely to pass cam-paign finance reform that wouldrestrict soft-money donations topolitical parties and increase theamount of hard money that can bedonated to candidates. (See IPAReview, March 2000.) Previousattempts to pass the legislation hadonly just failed. The perceivedscandal of Enron was the decisivefactor in getting the bill through theHouse this time. Yet the media failedto note that almost all Enron dona-tions to campaigns were in the formof hard money, which was increasedby current legislation, and not softmoney, which will be banned. Thislaw would have done nothing tohave changed Enron’s contributionsstrategy. The media has made greatplay of the money donated by Enronto Bush’s political campaign. Whathas received less attention is thatEnron failed to get the Bush Admin-istration to act on its behalf when itwas in trouble. It is a favourite ployof the media to concentrate on themotives of political actors ratherthan the substance of issues. Theycan then avoid the more difficult taskof explaining arguments to theirreaders or viewers.

Another theme has been to usethe fate of those who had, and thuslost, much of their superannuationin Enron stock as evidence that the

privatization of Social Securitywould be dangerous. (See IPAReview, December 2001.) SenateMajority Leader Tom Daschle stated,‘I don’t want to “Enron” the peopleof the United States. I don’t want tosee them holding the bag at the endof the day, just like Enron employeeshave held the bag’. He uses this tooppose the Presidential commissionon Social Security recommendationthat individuals should be allowed toinvest part of their Social Securitytaxes in investment funds. Theproblem with Enron was that manyemployees had placed a very highpercentage of their savings in Enronstocks, whose collapse left them withinsufficient savings. The same wouldoccur if the government SocialSecurity system collapsed, as manypredict. Privatized accounts, on theother hand, would be invested inhighly diversified stocks or bonds.Savers would thus be protected fromthe Enron problem.

The story of Enron demonstratednot capitalism’s flaws, but itsstrengths. Enron’s problems led tomedia predictions of widespreadenergy shortages and massive priceincreases. In fact, the consumer hashardly noticed the impact. Com-petitors in the industry quicklymoved in to replace Enron in themarket. The result has been noenergy shortages and no increase inenergy prices. Once again the mediahas preferred to avoid the real storyto concentrate on specious fears,which lead to bad policies. Onceagain the media has failed to carryout its function of providing in-formed and balanced debate.

Dr Nigel Ashford teaches in the Institute of HumaneStudies at George Mason University, and is co-authorof US Politics Today (Manchester University Press).

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T

The ABC: Unique Unto ItselfHE Sydney Morning Heraldreported on 1 Novemberlast year that, followingthe announcement of

Jonathan Shier’s resignation, thechampagne flowed in the taxpayer-funded Ultimo news room of ABCRadio National. You have to under-stand, as the friends of the ABC keeptelling us, this isn’t like a private-sec-tor workplace. It’s different. It’s pre-cious. It’s, well, it’s the ABC.

Whether that exuberance contin-ues after the appointment of the nextmanaging director remains to be seen.

Shier may not have eliminated left-wing bias at the ABC, but he recog-nized its existence and was trying tobring about change. According to areport in The Australian [22 February2001], his quest to find a ‘right-wingPhillip Adams’ was spurred by the ad-mission of some of his own staff thatthe national broadcaster lacked ‘diver-sity of opinion’.

Of course, a ‘right-wing PhillipAdams’, or even two, did not and willnot balance the overwhelming left-wing influence on news selection,analysis and commentary at the ABC.It is ingrained and inbred. It perme-ates every area of news and current af-fairs broadcasting.

The fact that some close to Shierinside the organization recognized thedistorted nature of the news and cur-rent affairs coverage, and were evenprepared to admit it, is one thing.Rooting it out of the place is somethingelse. Shier’s departure clearly showedthat, despite all the hysterical propa-ganda about Howard Government ap-pointees, reform does not have thenumbers on the ABC Board.

The behaviour of the chairman,Donald McDonald, on the issue hasbeen disappointing. While Shier wastalking about eliminating political biasinside the ABC, Mr McDonald simul-

JOHN STYLES

taneously challenged its existence.‘Give me the evidence—where’s thesignificant lack of balance ... ?’ he wasreported to have asked in an interview[The Australian, 22 February 2001].What hope did Shier have?

The danger now is that the ABCstaff and their supporters, having ef-fectively destabilized and deposedJonathan Shier, will, through the suc-cess of their campaign, tacitly influ-ence the selection of the next MD. Ifthe ABC Board placates them, andpragmatically selects someone from

inside Australian public broadcasting,the self-perpetuating nature of theABC ‘collective’ will be confirmed.

Just a few hours after Shier’s resig-nation was announced, former ABCdeputy chair Di Gribble was on air inMelbourne. She provided an ‘identikit’picture of her ideal ABC managing di-rector.

According to Gribble, ‘The ABCis not like a private corporation at all… I don’t really think that you cansee the ABC in the same way as yousee a commercial corporation’. A man-aging director, she said, would not beable to wield the same kinds of man-agement tools as are used in privateorganizations. ‘In a commercial com-pany it’s possible, for example to“incentivise” staff to achieve returnsfor shareholders … That’s really very

difficult in the ABC because the pro-gram makers or the people who gen-erally work for the ABC are focusedon things which are not easily mea-surable.’ As if we did not know it!

The ABC’s unbusinesslike environ-ment, therefore, according to Gribble,seems to close the door on anyone withrecognized business qualifications. ‘Ithink anyone who came into the ABCwith the kind of MBA kind of approachto management technique, a kind ofmanual, a kind of “management 1” sortof approach, would be absolutely at sea.All of the kind of books that “wanna-be” managers would read about man-aging corporations or whatever, it’s verydifferent in public broadcasting.’

Another thing. The new MDshould have ‘a very broad, culturedmind’. And if a managing directorcomes into the organization, likeJonathan Shier, wanting change, for-get it. ‘[T]he role of the employees ofthe ABC is different from the role ofemployees in another kind of company.They have, they bring a particular setof skills and there’s a tremendous senseof ownership.’

That ‘sense of ownership’, call it‘staff capture’, ‘the ABC collective’ orwhatever you like, is precisely why theABC needs a managing director whowill continue the work whichJonathan Shier started.

If, following the shrill and unrelent-ing anti-Shier campaign, the Liberalsresolve for ABC reform is at all falter-ing, those with influence should turnonce again to the bottom of page 255of Neal Blewett’s A Cabinet Diary andre-read the Paul Keating quote fromthe entry for 2 November 1992: ‘Any-how, the ABC deserves a decent go,because it has done well by the ALPin the last two elections’.

John Styles is a Melbourne-based media analyst.

I P A

If a managingdirector comes intothe organization,like Jonathan Shier,wanting change,

forget it.

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JOHN Hyde’s article‘Drugs: Time for aRethink’ (IPA Review,September 2001), was fol-

lowed immediately by an article en-titled ‘Surrender is not a WinningStrategy’. At first glance I assumedthat this was a rejoinder to his piece,but it was not. The title is appropri-ate, however. I believe that MrHyde’s reasoning offers a policy ofsurrender which will not help thedrug problem.

Indeed, we don’t use such adefeatist attitude in regard to manyother social ills. Most governmentsdo not argue that we must live withpollution, racism, or rape. In certainareas, we take exactly the oppositeapproach.

Consider the area of tobacco use.We tell young people to just say ‘no’.We have ‘Quit’ campaigns. We placevery high taxes on tobacco products.And what has been the result?Whereas 30 years ago over 60 percent of the population smoked, todaythat figure has fallen to under 30 percent. Harm prevention, in otherwords, works. Social trends are notirreversible. Problem social beha-viours can be turned around.

Also, Mr Hyde’s advice tacklesdrug problems from the wrong end.It asks us to manage the problem,instead of preventing the problem inthe first place. But prevention isalways better than cure. It is morecost-effective and more compas-sionate to keep people off drugs inthe first place, than to try to get themoff drugs. The old fence parable isappropriate here: Better to invest ina good fence at the top of a cliff thanto invest in a fleet of ambulances at

Drugs: Surrender Is NotA Winning Strategy

BILL MUEHLENBERG

the bottom of the cliff. Every dollarwe spend on prevention and deter-rence programmes will save hundredsof dollars on treatment programmeslater on, as well as save many lives.

And if full legalization isachieved, it will increase the pool ofdrug users. By removing the penaltiesfor usage, and by (in theory) reducingthe costs, demand will increase. Thisis a simple function of supply anddemand: make something easier andcheaper to obtain, and you increasethe number of people who will tryit. At the moment, there are millionsof alcohol and tobacco users inAustralia, but only thousands or tensof thousands of illicit drug users. The

main reason for the difference innumbers is related to the legality orillegality of the drug.

Consider some recent figures.Five per cent of all Australians usemarijuana on a weekly basis, com-pared to weekly alcohol users (66 per

cent). The former is illegal, while thelatter is not. In America, there are14,000 people killed a year by illicitdrugs, but 500,000 killed a year bylicit drugs. Moreover, in the US,marijuana use is down by 50 per cent,cocaine use is down by 79 per centand alcohol use is down by 13 percent—all because of the get-toughapproach to drugs.

Milton Friedman favours druglegalization. He said several yearsago, ‘Legalizing drugs might increasethe number of addicts, but it is notclear that it would. Forbidden fruitis attractive, particularly to theyoung.’ But as James Q. Wilsonpointed out, ‘I suppose that weshould expect no increase in Porschesales if we cut the price by 95 percent, no increase in whiskey sales ifwe cut the price by a comparableamount—because young people onlywant fast cars and strong liquor whenthey are “forbidden”’.

We can learn from history here.After Europe imposed the opiumtrade on China in the mid-19thcentury, by 1900 there were anestimated 90 million opium addictsin the nation. When British physi-cians could write prescriptions forheroin in the 1960s, the nation’sjunkies increased 30- to 40-fold.

LEGALIZATION MYTHSMr Hyde suggests that legalizationwill solve problems of crime, theblack market, and so on. Let me ex-amine some of the supposed advan-tages of such an approach:

It will empty our prisons. Criticsclaim that there are two millionAmericans languishing in prisons,

Mr Hyde’s advice

tackles drug problems

from the wrong end.

It asks us to manage

the problem, instead

of preventing the

problem in the

first place

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and if we would stop making druguse a criminal issue we would see anend to such appalling figures. Whatthey do not tell us, however, is thatwhile around two-thirds of theseprisoners are in fact in gaol for drug-related offences, very few are in theremerely for simple drug possession.Indeed, one study found that onlytwo per cent of the American prisonpopulation were convicted of puredrug possession. Most were in for ag-gravated drug crimes, that is, crimescommitted while on drugs (murder,armed robbery, theft, assault, childabuse, etc.) or crimes committed inorder to obtain drugs. Moreover, themajority of these crimes took placeunder the influence of alcohol, andnot illegal substances.

It will put an end to the black mar-ket and reduce the crime rate. Thisclaim is often heard, but there are anumber of problems with this argu-ment.

First, the costs to society for druguse are far greater than any moneyssaved on reduced law enforcementefforts. Consider the costs of druglegalization to society: lost pro-ductivity, increased medical servicesfor addicts and their families, morehighway accidents, etc. A recentstudy found that the annual cost ofdrugs to the Australian communityis $14.3 billion. Increase the numberof drug users, as legalization will do,and you increase this figure as well.

Second, any ‘sin taxes’ raised bythese legalized drugs will still notoffset the costs to society mentionedabove. Indeed, the taxation oflegalized drugs will still drive peopleto crime. In order for governmentsto raise enough revenue from drugtaxes to pay for all the costs ofincreased drug use, the taxes willhave to be high. But the higher thetax, the more the demand for blackmarket drugs, or the more crimeresorted to pay for these higherpriced drugs.

Third, the profit motive aboundsin already legal operations. Thealcohol and tobacco industries are

currently driven by hopes of largeprofits. If drugs were legalized, wholenew industries would develop to cashin on the trade. Greed for gain doesnot disappear when an activity islegalized.

Fourth, black markets exist todayfor all kinds of legal products. Justbecause something is legal does notmean the black market will dis-appear. People will still want to beattaxes, escape government notice, orsell to minors, thus the demand forblack markets will continue, even onlegalized products.

Fifth, drug use contributes tocrime. It is the illegal activitiespeople engage in while on mind-altering drugs that is the real prob-

lem. It’s not just that people do badthings to get drugs; drugs make themdo bad things. Consider some sta-tistics:• A 1991 US Federal survey found

that a majority of those arrestedin 24 cities for robbery, assault,burglary and homicide testedpositive for drugs.

• A 1994 study of 31,000 abusedand neglected children in CookCounty, Illinois, found that morethat 80 per cent of the cases in-volved drugs.

• In New York in 1987, 73 per cent

of child abuse cases involved pa-rental drug abuse.

• A 1992 study of NSW inmatesfound that 67 per cent of prison-ers had been on drugs while com-mitting the crime they were im-prisoned for.

• A 2000 study of Australian de-tainees found that a large per-centage had tested positive fordrug use. For example, 70 per centof adult male detainees chargedwith violence tested positive toany drug, and 86 per cent of adultmale detainees on propertycharges tested positive to anydrug.

Also, cheaper drugs do not necessar-ily mean less crime. When inexpen-sive crack cocaine flooded Americain the early 1980s, the rate of addic-tion soared, as did crime rates. In-deed, police noted that whereverdrugs were the cheapest, crime rateswere the highest. And when Britaingave out heroin to addicts in the1960s, a very large proportion re-mained involved in crime.

Prohibition has never worked. Crit-ics often argue that prohibition hasnever worked. But the facts speakotherwise. During Prohibition inAmerica, consumption of alcoholdeclined substantially, as did the cir-rhosis death rate for men (cut by two-thirds between 1911 and 1929), andarrests for public drunkenness drop-ped 50 per cent between 1919 and1922. When Muslim societies re-moved restrictions on hashish in the15th Century, it resulted in a largenumber of people from all walks oflife being in a constant state of in-toxication.

The truth is, the ‘get tough’approach to drugs has been fairlysuccessful. It may not be a panacea,but it does not seem to be competingagainst any other better proposals.

Bill Muehlenberg is National Secretary of theAustralian Family Association

[O]nly two per cent ofthe American prison

population wereconvicted of pure drugpossession. Most were

in for aggravateddrug crimes, that is,crimes committed

while on drugs

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FAVOURABLE EFFECTS OFIMPRISONING DRUG

OFFENDERSThe number of Americans incarcer-ated on drug-related offences rose 15-fold between 1980 and 2000, to itscurrent level of 400,000. Despite thisenormous increase, there has been nosystematic, empirical analysis untilnow of the implications of the new,tougher drug laws for public safety,drug markets, and public policy.

In ‘An Empirical Analysis ofImprisoning Drug Offenders’<http://papers.nber.org/papers/W8489>,authors Ilyana Kuziemko and StevenLevitt find that the increase in theprison population on drug-relatedoffences led to reductions in timeserved for other crimes, especially forless serious offences. This pheno-menon is primarily attributable to thelimited space available at penalinstitutions. However, despite thisreduction in time served, other crimesdid not increase more than a few percent.

The authors also find that incar-cerating drug offenders was almost aseffective in reducing violent andproperty crime as was incarceratingother types of offenders. Furthermore,as a consequence of increases inpunishments for drug-related crimes,cocaine prices are 10–15 per centhigher today than they were in 1985.This jump in price implies thatcocaine consumption fell, perhaps byas much as 20 per cent.

The reduction in cocaine usebegins to address the long-standingquestion of whether the enormouscosts related to tougher punishmentfor drug offences yield similarly largebenefits to society. Previous studiessuggest that the costs of current levelsof incarceration across all crimecategories far exceed societal benefits.However, in the case of drug offend-ers, the authors find that the cost–

benefit calculations might be morefavourable, because incarceration notonly lowers crime, but also drugconsumption. Annual expendituresof approximately $10 billion on drugincarceration almost pay forthemselves through reductions inhealth care costs and lost productivityattributable to illegal drug use, evenignoring any crime reductions asso-ciated with such incarceration.

The authors stress that theirfigures are speculative and may notinclude other relevant costs andbenefits. They also do not exploreother, potentially more effective waysof reducing drug usage rather thanincarceration.

Source: (Les Picker), NBER Digest,January 2002, National Bureau ofEconomic Research.

USING DUYONGS AS AWEAPON TO STIFLE

GROWTHThe Florida manatee (or duyong), theslow-moving, weed-munching, un-derwater mammal, is listed as an en-dangered species. It has been co-optedas a tool of anti-growth advocates—whom critics say are less concernedwith the animals’ welfare than withrestricting development.

For instance, Patrick Rose, alobbyist for the Save the ManateeClub, calls manatees ‘the best, mosteffective growth-management toolthat exists’. Here’s how it works:• Of the 325 Florida manatees that

died last year, 81 are believed tohave been killed in collisions withpower boats.

• So the state has blocked construc-tion of new marinas until coun-ties adopt manatee-protectionplans—which require lengthystudies of the effects of watersidedevelopment on the mammals.

F U R T H E R A F I E L DSummaries and excerpts from interesting reports

TORT LAWYERS DISCOVERGOLD IN MOULD

For lawyers, household mould couldbe the next asbestos. Some 10,000suits naming contractors and insur-ers are building up in US courts. Thecommon theme is that mould inhomes is making their clients sick—causing everything from headachesand dizziness to neurological dam-age.• Mould is the visible growth of

any of 100,000 species of fungus.• While certain types of mould

contain a mycotoxin that can befatal, such cases are extremelyrare.

• The Center for Disease Controland Prevention has recanted anearlier report that implicated atype of mould in the bleedinglungs of eight Cleveland in-fants—admitting that the studyused unorthodox collection tech-niques and was flawed—and nowsays that mould can cause aller-gic reactions, such as waterynoses.

• It also states that there is noproven link between mould andillnesses.

But the legal damage has alreadybeen done. Mould litigation hasspread across the country. Schooldistricts in Illinois and Ohio havebeen hit by suits from studentsclaiming health problems. A Texasjury awarded $32.1 million to a Dal-las executive—although the insur-ance company involved is appealing.

Insurers estimate that they paidout $670 million for mould-relatedproperty damage in Texas alone in2001—more than double the totalin 1999.

Source: Mary Ellen Egan, ‘The Fun-gus that Ate Sacramento’, Forbes, 21January 2001.

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NO LONGERUNTHINKABLE: PAYMENTS

FOR HUMAN ORGANSIt has taken a major shortage of or-gans for transplants, but the medicalcommunity is no longer so shockedthat it refuses to consider paying forthem.• Some 79,000 Americans are

awaiting transplants—and 5,500who are on waiting lists die eachyear.

• So a committee of the AmericanMedical Association has been de-signing a pilot programme to testthe effects of various motivators—including payments for cadavericorgan donations.

• The committee is already con-vinced that any moral concernsare outweighed by the needs ofpatients.

• Meanwhile, an advisory commit-tee at the Department of Healthand Human Services is discussingways to alleviate the organ short-age—including lifting the ban oncadaveric and live donors.

The American Society of TransplantSurgeons has already endorsed pay-ment for cadaveric organs to familieswho consent to donate them when arelative dies.

The practice would be ethical if‘understood as a thank you’ and ‘nota bribe’, says Francis Delmonico, aprofessor of surgery at HarvardMedical School. He says that sums of$300 to $3,000 have been discussed.

Observers say that if the AMAendorses a programme that wouldoffer donors or their families smallrewards, Congress would probably goalong with it.

Source: Barbara Carton, ‘Doctors,US Government Move Closer toBacking Payment When Organs AreDonated’, Wall Street Journal, 14February 2002.

• Builders and boaters contend thatbiologists have put off studies thatcould show that manatees arethriving and that more restrictionsare not needed.

• The annual state aerial surveycounted 3,261 manatees in2001—up from 2,222 in 2000.

While it is true that watercraft-relatedmanatee deaths have been increasingin the last several decades, boatersattribute that to growth in the state’smanatee populations.

Last year, the US Fish and WildlifeServices proposed to charge $546 foreach new boat slip to pay for addedlocal manatee speed patrols. But theplan was withdrawn after it wasopposed by Florida Governor JebBush.

Some observers are disgusted thatthe welfare of the manatees has beenlost in the anti-growth debate. In oneinstance, the Save the Manatee Clubabandoned its opposition to a de-velopment project after the developeroffered to contribute $200,000 to theorganization.

Source: Andrew C. Revkin, ‘HowEndangered a Species?’, New YorkTimes, 12 February 2002.

CORRUPTION ANDCURRENCY CRISES LINKEDRampant public corruption in emerg-ing market countries may contributeto the currency crises that haveracked the developing world, becausecorruption acts to repel more stableforms of foreign investment andleaves countries dependent on vola-tile foreign loans to finance growth.

Researchers Shang-Jin Wei and YiWu make the following case:• The most dependable kind of for-

eign investors—those disposed tolong-term commitments to pro-jects and businesses—often refuseto put their money in developing

countries where, for example, lo-cal bureaucrats expect bribes andthe national government arbi-trarily preys on business enter-prises.

• Those countries still need foreigncapital, and while they may beundesirable for foreign direct in-vestment (FDI), they may not beequally disadvantaged when itcomes to obtaining bank loansfrom international creditors.

• One reason loans are easy to pro-cure even when corruption iswidespread is that the Interna-tional Monetary Fund and govern-ments of developed nations offerconsiderably more insurance andprotections to lenders than to di-rect investors.

• The result is an investment port-folio heavily skewed toward loans,and given how foreign lenders areknown to flee at the first sign oftrouble—while those directly in-vested in an enterprise tend to sittight—such an imbalance leavesan economy much more vulner-able to a currency crisis.

Wei and Wu argue that, by discour-aging stable flows of investment capi-tal, corruption—whose measure theyderive from international surveys—can be viewed as a sort of corporatetax on assets. For example, they con-clude that ‘… an increase in corrup-tion from the level of Singapore tothat of Mexico would have the samenegative effect on … foreign invest-ment as raising the marginal corpo-rate tax by 50 percentage points’.

Source: Matthew Davis, ‘HowCorruption Causes Currency Crises’,NBER Digest, August 2001; based onShang-Jin Wei and Yi Wu, ‘NegativeAlchemy? Corruption, Compositionof Capital Flows, and CurrencyCrises’, NBER Working Paper No.8187, March 2001, National Bureauof Economic Research.

F U R T H E R A F I E L D

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32 MARCH 2002

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The media lovewhistleblowers,

except when thewhistle being

blown is on theirown profession

Book ReviewThe Ultimate Insider

Don D’Cruz reviews

Bias: A CBS InsiderExposes How the Media

Distort the News

by Bernard Goldberg

New York, Regency, 2002, 232 pages

Bias was released in the United Statesamid considerable controversy and fan-fare. After years of railing against whatUS conservatives saw as the media’sliberal bias, one of America’s liberalmedia élite finally confirmed most oftheir charges.

Reading Goldberg’s book it is easyto see why it has made such an impact.Goldberg is not a Rush Limbaugh. Alltoo often, even the best critiques of themedia on the question of bias havebeen easily dismissed by the media sim-ply by pointing to the background orideology of the author. Another com-mon tactic has been simply to say thatit is in the eye of the beholder.

Bias makes this task far more diffi-cult because Bernard Goldberg is one ofthem. Not only that, but as the winnerof seven Emmy Awards and a journal-ist with almost 30 years’ experience asa reporter and producer for CBS News,Goldbderg is the ultimate insider.

He is at pains to point out that hisbook is not an attack on liberal values,many of which Goldberg personallyespouses; rather, it is an attack on lib-eral bias which he sees as endemicwithin the news media.

Goldberg takes aim at what he seesas the corruption of straight news re-porting on television by an arrogant,insular media élite which shares simi-lar liberal values, with little time or in-clination for introspection and cer-tainly no time for criticism. It is a por-trait of a medium that proclaims its love

of diversity (whether it is on the basisof race, religion, gender or sexual ori-entation), but not diversity of opinion.There are times when Australian read-ers might imagine that they are read-ing about parts of our media.

As an insider, his revelations are notas easy for America’s media élite to dis-miss; although the American media didmake a reasonable attempt at it.

Goldberg is simple and fairly old-fashioned in his belief that journalismshould be about balance and present-ing all the facts, not just the ones thatyou think will help your argument, orthose which you think the public is too

unsophisticated to digest or aboutwhich it may become confused.

Bias became a book after Goldbergwrote an op-ed piece in the Wall StreetJournal in 1996, methodically dissect-ing a piece on a so-called CBS NewsReality Check on Republican presi-dential candidate Steve Forbes’ flat taxproposal. Frustrated by years of havinghis misgivings ignored by colleagues, hewent public. It was a devastating cri-tique, both for CBS and for Goldbergpersonally.

An intriguing and disturbing partof the book is Goldberg’s account ofhow his colleagues reacted to his voic-ing his concerns over bias publicly. Histreatment by his colleagues, many ofwhom had known him for almost 30

years, is fascinating given his supposedtransgression—speaking out. It wouldappear that the media love whistle-blowers, except when the whistle be-ing blown is on their own profession.

Goldberg’s treatment for blowingthe whistle at CBS is all the more fas-cinating when one realizes that it wasCBS which introduced the concept ofthe corporate ‘whistleblower’.

Given that the media are often themost vocal defenders of free speech, theattempts by his networks and col-leagues to muzzle him reeks of grotesquehypocrisy.

Bias maybe written for an Ameri-can audience, but many of Goldberg’scriticisms and observations are eerilyprescient concerning the Australianmedia. When he writes that ‘big-timeTV journalism’ has become ‘a showcasefor smart-ass reporters with attitudes,reporters who don’t even pretend tohide their disdain for certain peopleand certain ideas that they and theirsophisticated friends don’t particularlylike’ (page 15), Goldberg could quiteeasily be writing about sections of themedia in Australia.

Bias is an enjoyable and engagingbook, often extremely amusing. Hispersonal portraits of senior Americanjournalists will amuse anyone familiarwith their names. But it is also a sear-ing indictment of the profession of jour-nalism at times, which leaves one pro-foundly depressed.

Still, the fact that we have Gold-berg’s book should be seen as a sourceof hope. We can only hope that an in-sider of similar credentials at the ABChas a similar outbreak of conscienceand pens an Australian equivalent.

If you’re interested in the media,Bias is one book that it is worthy ofyour attention.

Don D’Cruz is a Research Fellow withthe Institute of Public Affairs.

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