Australia had a chance at the election last Saturday (18 May 2019) to turn towards a more compassionate, inclusive society, to shoulder its responsibilities to reduce its contribution to deadly climate change, to share more, to think about what we as individuals can do for our country, and especially for those less fortunate than ourselves, rather than just for me and my family.
Despite the polls and the bookmakers portraying Labor as an unbackable favourite to win (or perhaps partly because of that), Australia did not take that chance. That was a mistake, and it reflects shamefully on the Australian electorate. They chose to vote for what they had been misled into believing were their own financial interests, without casting the slightest thought to what the interests of others might be, especially the less fortunate.
The invariable custom after surprising election losses is for political pundits to line up to give their smug views about what the loser did wrong. The fact that these same pundits did not identify as mistakes before the election the tactics of the loser that they are now saying were mistakes is not mentioned. Carefully avoiding that embarrassing admission, the pundits continue to pose as all-knowing, all-wise, basking in the glow of their own all-seeing hindsight.
If it is a mistake to do something that can only be identified afterwards to have disastrous consequences then it was a mistake for me not to take the entire savings of my family, re-mortgaged our house for as much as I could, and bet the lot on the Coalition winning the election, for which I would have quintupled our wealth. Was that a mistake? Would it have been a responsible act to do that? Would it have been ethical? Of course not. It would have been reprehensible.
We can go further. With the benefit of hindsight, we can say it was a mistake for the midwife that assisted at the birth of Pol Pot not to have strangled him at birth.
If the only insight you have to offer on an event comes from hindsight, better remain silent!
To take a small philosophical digression, the comments from hindsight are not even correct! To say that Labor would have won if it had used a different tactic – made itself a ‘small target’ by announcing as little policy as possible before the election – is to assume that the damage incurred by being a big target would not have happened but everything else would have remained the same. In real life of course, everything else never remains the same! To imagine how history would have evolved if we were to change one or two things (killing Pol Pot at birth, making Labor a small target at the 2019 election) is indulging in what’s called a counterfactual, something that, as I discuss in this essay, is rife with logical problems. At the practical end is the problem that everything else never is the same, once we change one or two significant factors. As both Dirk Gently and the Buddha pointed out – everything is connected to everything else. At the theoretical end, we have the even more difficult problem from Bell’s Theorem of quantum mechanics that, unless we allow the possibility of faster than light communication, it is not even valid to ask what would have happened if we’d done something differently. The question is meaningless!
So take that, pundits burbling on about Labor’s mistake! Get back to me once you’ve read up on the Madhyamika notion of Dependent Origination and understood Bell’s Theorem, and are able to try to fill the holes they blast in your smug platitudes.
Unfortunately, ignoring the pundits is not enough to save us from discussions of ‘what Labor did wrong’, because the Labor party itself will be doing some soul-searching over the result. That is unavoidable, and understandable. After a loss, one has to use the experience to gain insights about what might work better next time. I don’t mind that, as long as there is no pretence that the Australian public (which democratic dogma insists we must treat as being infinitely wise!) has sent a message to the party about what is necessary to be a good government. So often after elections we see the defeated party, or sometimes a party that wins but much less handsomely than it had expected, make public statements of contrition, asking the voting public for forgiveness for not being what they wanted, and promising to listen more. To do that in this case would be like a parent grovelling before a toddler after the toddler has had a tantrum because it was prevented from hitting its baby sister, promising to be more accommodating to the toddler in future, if only the toddler will please, please forgive its silly, misguided parent.
I am not, of course, suggesting that the relationship of politicians or governments to the voting public is like that of a parent to a child. That idea went out with Plato, thank goodness. I am just pointing out that the failure of the voting public to accept an offer of changes to society from a political party does not mean that it was not a good offer. How otherwise can we explain the continual re-election of war-making Binyamin Netanyahu over his peace-seeking opponents, of the South African National Party for so many years in the apartheid regime there, or the repeated electoral rejection of MPs in 18-19th century Britain that sought to end the slave trade? There is no wisdom to be found in democratic decisions. Their only virtue is that they are less often as vicious as some of the non-democratic decisions that get made.
This election was billed as the ‘climate election’. One of the main differences between the parties was that Labor had a program to rein in Australia’s greenhouse gas emissions, while the Coalition not only did not have any plan and had presided over rising emissions in recent years, but were toying with the idea of using taxpayer money to subsidise the construction of new coal-fired power stations. So much for the Coalition being the party of free enterprise and small government!
The Australian voting public chose to vote for the party that wanted to do less than nothing to control climate change. Does that mean that controlling climate change is a bad idea? No, it just means that the Australian voting public is, on average, too selfish to be prepared to do anything about it, if there is the slightest risk that it might cause them a little inconvenience. For most Australians, caring about the climate apparently means tossing an item in the recycling bin occasionally, buying a few cloth shopping bags that will end up at the bottom of some cupboard because it’s too hard to remember to take them to the shops, and and nodding in a concerned-looking way, saying ‘oh yes how awful’ in a compassionate-sounding voice when there is talk of the devastation climate change is wreaking.
Undoubtedly Labor underestimated how selfish and gullible the average Australian voter is (gullible, because they were able to be convinced that increased taxes, and removal of government handouts, that only affect the wealthy, will somehow affect middle and working class Australians as well). The party took a risk, publishing detailed policies on a number of important issues, rather than just running on the platform that the current government has been distracted by internal warfare for six years and has done nothing for the country, so should be sacked. They made themselves a big target because, if you go to an election with policies, you have a mandate to implement them. If you go to an election without policies, all you have a mandate for is not being the previous mob. As soon as you try to make any significant policy initiatives, people can complain that’s not what they voted for – with some justification (although not very much if, like me, you support Edmund Burke’s formulation of the duty of a representative government).
To go to an election with few policies is great if all you aim to do is get elected. We have had governments in the past, on both sides, at both state and federal level, that have focused solely on getting into and staying in power, never made any policy decisions that might frighten anybody, and hence achieved nothing and left the country or state a worse place than it was when they came to government (Bob Carr, former NSW Labor Premier, take an especially deep bow!). To go to an election with a bag full of policies is politically courageous but also politically generous, because it offers the country the opportunity of real, meaningful government, rather than just self-obsessed clinging to power. What this election result seems to suggest, as did the surprise defeat of the Coalition in 1993 with its big target ‘fightback’ policy reform package, is that it is not politically possible for challengers to offer meaningful policies, because against any meaningful policy that involves significant government income or expenditure, a scare campaign can be mounted. Why? – because to be meaningful it must involve some change in income or expenditure – either the amount or from where it is obtained or to what it is applied – and that means there must be some people that will be less well off under the proposal. All that’s needed for a good scare campaign is to persuade enough people that they will be one of those worse off, regardless of whether there’s a skerrick of truth in it.
I don’t blame the Coalition for its scare campaign on taxes and reduction of government subsidies to well-off retirees. Any political operator on either side will make the best use of the tools available to them, within some pretty broad limits, and the Coalition did just that. Any political party would do the same. What is disappointing is that the Australian voters were (1) gullible enough to be convinced they would be disadvantaged by something that wouldn’t disadvantage them and might even benefit them and (2) selfish enough to use that as a reason to not do anything about climate change, more compassionate treatment of refugees or many of the other elements of the Labor policy package that sought to help the less well-off.
In 2022 we can expect the Labor campaign to be almost policy-free, as the Australian public has made it crystal clear to the political parties that that’s what’s necessary to get elected these days. Next election, the pundits will all line up to criticise that, conveniently forgetting that they criticised Labor after this election for not being policy-free.
It’s a bit sad these days, walking down the street, seeing people’s faces, and recognising that the majority of them voted for themselves, rather than for climate action or reduction of inequality. I can’t know which ones voted which way, so I try to give each person I see or with whom I interact the benefit of the doubt, and assume that they were not one of the selfish ones, even though I know the odds against that being the case for all of them are astronomical. It’s just part of trying to remain cheerful and being friendly to people.
It’s very sad, but it’s bearable. As long as I don’t have to listen to anybody in Labor begging the forgiveness of the Australian people and promising to listen more. It should be the other way around.
Bondi Junction, May 2019
When it comes my turn to be king of the world I will ban the word ‘obviously’, together with its fellow travellers ‘clearly’ and ‘evidently’. My challenge to you, the other inhabitants of the kingdom of Earth, is this: find me a single example of a sentence that is improved by the use of the word ‘obviously’!
I assert that, not only is ‘obviously’ never an improvement to a sentence, but it usually degrades a sentence into which it is inserted and renders it foolish, pompous, or just plain false.
The first memory I have of encountering this rebarbative word is in mathematics lectures at university. It was the early 1980s. In those days lectures performed their proofs live on the black board with chalk – a difficult endeavour indeed. As soon as you saw that word on a board, you felt that if you couldn’t instantly see why that line followed logically from the line before, you must be very dim. If you hadn’t seen the connection by the time they finished writing the next line, you started to panic. The only solution was to accept the claim without challenge and try to keep up with what came next. There would be time that evening to go over your notes and try to work out why the claim was ‘obviously’ true.
Sometimes in the evening you could figure it out without difficulty. Sometimes you figured it out but it needed a page or so of closely written reasoning to justify it. Sometimes you couldn’t make it out at all. That’s when you had to summon your courage and challenge the lecturer about it before the next lecture. You’d sidle up to him and say ‘Sorry to bother you but I can’t see how you get line five. Can you please explain it?’
In short, it was rarely obvious. Even when it was moderately obvious, there were other lines that were more obvious, for which the tag was not used.
I started to detect a pattern. The word was being used to cover for the fact that the lecturer couldn’t remember, off the top of their head, the justification for the line. By writing ‘obviously’ they made potential hecklers too worried about seeming dumb to challenge the claim on the spot. It was the Emperor’s New Clothes all over again. What was needed was the little boy to blurt out ‘But it’s not obvious at all. In fact I can’t even see it.’
I forgive those lecturers, because what they were doing was very difficult. I would feel under a lot of pressure having to perform mathematical derivations on a blackboard in front of a specialist audience.
It is less forgivable when it occurs in text books. In many a mathematics or physics text book I have come across the prefix ‘obviously’ before a line that was the exact opposite. The authors of textbooks do not have the excuse that they have to come up with explanations on the spot, but they are nevertheless under time pressure because, unless a text is chosen as a key text for courses at many major schools or universities, it will not bring in much revenue, so extra time spent writing it makes it even harder to be profitable. Why spend hours deriving a proof of something you are fairly sure is true, but don’t remember why, when you can just write ‘obviously’ in half a second, and move on to the next line?
I don’t begrudge them saving that time, but there are more honest and helpful ways to do it. Other phrases that can be used are “It turns out that…” and “It can be shown that…”. These make it clear that what the author has written is not a full proof, and that the step over which they are glossing is not trivial. When I encounter those I don’t mind very much because they don’t contain the implicit challenge “If you can’t see why this line follows from the last one you must be stupid!”. The most generous excuse of all is “It is beyond the scope of this paper / text / chapter to prove X, so we will take it as read”. That way the reader knows that proof is long and difficult.
It is annoying when academics use the word ‘obviously’ in that way, but at least they use it in relation to a claim that is true. In political argument, that is not the case. People use ‘obviously’ to justify any claim, no matter how dubious, or sometimes just plain wrong. Examples abound, from politicians, shock jocks and reactionary newspaper columnists.
“Obviously, decriminalising marijuana use would make the problem worse”
“Obviously, it makes no difference whether Australia reduces its greenhouse gas emissions, since ours only make up a small part of the world’s total”
“Obviously, what’s needed to solve our city’s traffic problems is to build bigger roads”
“Obviously, we have to be cruel to refugees, otherwise many more would come to our country”.
It’s used as an excuse to not even consider any evidence that may be available, to not even entertain rational discussion on a topic. It implies that anybody that does not accept the claim must be stupid or have dishonest intentions. It’s an attempt to shut down inquiry and discussion, lest that lead to an outcome against which the speaker has an entrenched prejudice.
Is anything ever obvious?
Perhaps, but we need to very careful in suggesting that. What is obvious to one may not be at all obvious to another. A high-visibility yellow vest is obvious to normal-sighted people but not to the colour-blind. A person walking across a basketball court in a gorilla suit is not obvious to observers that have been tasked with counting the number of times each player passes the ball.
Further, beliefs in what is obvious are often founded on stereotypes that may be damaging. Is it obvious that boys are better at maths than girls, or that men cannot be trusted to care for other people’s children?
This leads me to wondering whether there is any sentence in which the word ‘obviously’ can play a useful role. I don’t apply the same challenge to ‘obvious’ because it can have observer-dependent roles, as in “It eventually became obvious to Shona that the doorman was not going to let her into the club”. Or we can use it to express relative obviousness, as in “Not wanting to mislay them, he left his keys in the most obvious position he could think of – in the middle of the empty kitchen bench”.
But “obviously”? That adverbial suffix ‘ly’ seems to strip from the adjective any ability to convey subtleties of degree. There seems to be no way of using it that does not imply that anybody who does not agree with the following proposition, and understand why it must be correct, is simply stupid.
No wonder it is used either as a tool of bullying or as a lazy attempt to escape the need to justify one’s claims.
Sometimes it occurs without intent, as a verbal tic. Like most verbal tics, it is rooted in the insecurity of the speaker. Although it sounds like it has an opposite meaning to other tics like ‘if that makes sense’ or ‘if you like’, it serves the same purpose in deflecting attention from the speaker’s insecurity – but in an offensive rather than a defensive way. In both cases the speaker hopes not to be challenged. With ‘if that makes sense’ the hope is that the humility it projects will discourage a listener from saying ‘that doesn’t sound right’, if only out of charity to the speaker. The ‘obviously’ is like the puffed-out frill of a lizard – a pretence at invulnerability intended to discourage attack: ‘Challenge me on this and you’ll end up looking foolish!’. Except that the intent is usually subconscious and, once one has used the phrase many times, it becomes reflexive, devoid of any meaning, or even of subconscious intent.
I vowed quite some time ago never to use the word, or any of its synonyms. I think I have managed to keep the vow. I hope I have. But I cannot be sure. One uses so many words in the course of a week, that it’s hard to keep track of them all.
If something is truly obvious to almost everybody, there should be no need to state that. It will be obvious that it is obvious. If, as is more often the case, it is far from obvious, it is foolish at best, and dishonest at worst, to imply that it is.
Bondi Junction, April 2019
So I was riding to work, right? And I went around the corner on a shared path and came a little bit closer to a family of pedestrians than is ideal. I didn’t come very close, and wasn’t going fast. There was absolutely no danger, or even capacity to frighten, but you know, it’s best to give pedestrians a wide berth on a shared path, because it can be a bit scary when a bike comes near. At least I find it scary when a bike comes near me if I’m not ready for it.
Anyway, I sort of mumble something like ‘Sorry – a bit close’ as I go by and I just see this guy’s face – the father I reckon – looking at me calmly and waiting for me to pass.
My, what a patient guy, I think.
Then, because I can’t help imagining and catastrophising at the same time, I imagine what if he were like one of those alpha males that aggressively yells at anybody given the slightest opportunity, and he abused me? What would I say?
I thought, well I’d probably sheepishly mumble something like ‘Didn’t mean no harm mate’, which I didn’t, you know, and anyway I wasn’t that close, and it was a shared path.
But then it occurs to me that, in Australia ‘Mate’ is as often a challenge as it is an expression of fellow-feeling. Expressed with the right tone of voice at the beginning or end of a sentence, it often means ‘You stupid, quivering, pathetic excuse for a human being (that isn’t as manly as I am)’.
That would been almost the exact opposite of what I meant to convey to the man (who, let us remember, was patient and calm in real life). But that’s the trouble with the word ‘Mate’ here downunder.
Reactionary politicians love to talk about ‘mateship’ being a cornerstone of our culture, as if it’s a good thing. That’s weird. If it just means friendship then how is that specifically Australian? Don’t people in other countries have friends, and aren’t they kind and loyal to them as well? It makes as much sense to claim that as an Australian characteristic as it does for American nationalists to pretend they invented the concept of freedom.
No it means more, and yet less, than that. For a start it’s a specifically masculine term, even though they like to pretend it isn’t. Mateship is about drinking together in the pub until you can barely stand, and then not dobbing in your mate if, when he’s had a few too many, he drives a car, or belts his wife. There’s no room for women in mateship, and very little for non-Caucasians.
So I don’t like mateship, OK. I regard it as toxic, to use the word du jour. Nationalist zealots might say I go too far in my criticisms, but I say Yah, Boo, Sucks to them. Let’s stick with friendship, tolerance and compassion if we want to characterise how we aspire to relate to others.
I don’t like ‘Mate’, but I quite like ‘Comrade’. Partly because it seems so quaint and old fashioned. To me it conjures up Australian icons like Phillip Adams and Gough Whitlam. Round here it is redolent of a bygone age when brave, committed, idealistic (some might say deluded but I don’t think we’re in a position to judge) Australians believed in and worked for the Communist or Socialist dream that they saw as the only way to help the downtrodden, before Stalin, Mao, Ceaușescu and Pol Pot ruined it for us all.
Well they didn’t actually ruin it completely. They sullied it, and nobody wanted to touch it for a few decades. But now that we’re seeing the impact of über-capitalism around the world destroying cultures, livelihoods, employment and the environment, and face the prospect, with AI starting to take away all the jobs, of the world dividing into ten percent or less super-rich who own all the technology and the patents, and the rest are the unemployable, expendable poor…. Maybe now, it’s time to have another look at Comrade.
Now I understand that for people who lived in the Soviet bloc, the word Comrade may have the same horrible associations of aggression as Mate sometimes does in Australia. So maybe that’s not the right word. It would be OK here in Oz, but probably not in Russia (Tovarich) or Rostock (Kameradin / Kamerad).
I have another proposal though – Citizen.
I’ve been reading ‘The Gods Are Thirsty’ by Anatole France. It was written in early 19th century and is set in 1793, four years after the French Revolution and only months before the beginning of ‘the Terror’, the orgy of show trials and guillotinings led by Robespierre, in which 17,000 people were executed and another 10,000 died in prison.
That’s what people called each other after the French Revolution – Citizen (in French they said Citoyenne for women and Citoyen for men). Just as they called each other Comrade after the Russian Revolution.
Like Comrade, Citizen seems to have a connotation of working together, of shared civic responsibilities, that Mate doesn’t have. I like that. It’s nice to work together, rather than alone.
Shall we call one another Citizen, then?
But wait, what about those 27,000 dead in the French Terror? Did Citizen become just another term of passive aggressive bravado and bullying in the 1790s, just as Mate can be in Australia and maybe Comrade was in the 1930s Soviet Union?
Oh bother! Maybe we can’t call each other Citizen either.
What about ‘Friend’, then? That’s the sort of thing that wise old women and men call you in fantasy epics when you meet them on the deserted, long and winding roads through the wildlands. Surely that’s good isn’t it? Could we call each other that?
It can sound a bit creepy, I know. Like a stranger trying to insinuate themselves into your confidence. But is that just the product of the modern cynical mind? If we said Friend and meant it, and when it was said to us we accepted it as being meant as a genuine, friendly salutation, would it work? I think it might.
Sadly, it does remind me of another revolution though. Or perhaps this was more of a coup than a revolution – the seizure of power by Julius Caesar and his proclaiming himself emperor.
You know: “Friends, Romans, countrymen, lend me your ears”.
Caesar was a fairly violent ruler – he invaded and slaughtered my ancestors for goodness sake! Everybody can find a story of colonisation and persecution of their ancestors if they go back far enough. But it only continues to mean anything if it’s recent enough to affect the memories or the life opportunities and prosperity of people whose ancestors were colonised and persecuted. And that’s not the case for me. Not even as regards the Norman invaders – bastards! And the even more recent English invaders of my Irish ancestors – double bastards! I know that some of my ancestors will have been colonisers of the other ancestors – the Romans, Angles, Saxons, Jutes, Vikings, Normans and English invaded and/or colonised the Britons, Anglo-Saxons and the Irish. But none of my current family were alive at the time of the persecutions, and my life opportunities have not been constrained by them, so I can’t complain.
What about Friend then? Does its association with Caesar and the aftermath of a coup make Friend yet another term that is tainted by association with brutishness?
Well now, I remember of a sudden that it was Shakespeare that wrote that bit about friends and ears, not Caesar. And in any case, Wikipedia tells me that it was Marc Antony, not Caesar, that uttered those words in the play.
So maybe Friend is OK.
Trouble is though, I don’t think I can quite carry it off. I am neither old enough nor wise enough to address people as Friend without appearing like a creep or a dangerous loon.
I think it will have to be Comrade after all. I’ll just be careful not to use it to address anybody that lived under Soviet oppression. And maybe I’ll make the odd switch to Citizen now and then when I want to sound sophisticated and cosmopolitan, provided I am sure there are no survivors of the Terror nearby to be offended by it.
Anything is better than Mate.
Perhaps Mate is okay as a non-sex-specific description of a life partner though, as in ‘puffins mate for life’, which is just so heart-warming, and how could anybody not love puffins? I’ve heard they are disgusting to eat, all oily, fishy and livery, like gelatinised cod liver oil. But that doesn’t worry me since I don’t eat any birds.
Goodbye for now, Comrades.
Bondi Junction, December 2018
I am on a coach that has just left Sydney, travelling towards the town where my parents live. I might say where my father lives, because I am travelling there to attend the funeral of my mother.
My mother died of a combination of advanced dementia and dehydration, as she had reached a point where she would not or could not take anything orally any more, be it medicine, food or water. Whether it was would or could, we did not know, because her brain had deteriorated to a state in which she was mostly unable to communicate. Dementia is a cruel illness. We know that, if she could have formed and expressed coherent wishes in her last months, she would have asked for assistance to end her life peacefully, because her advanced care directive states that in very clear terms. But our government, like many, is cruel – with heartless rules that forbid any such mercy, kept in place by theocratic politicians wishing to force their own dogmatic religious rules on others, and medical lobbyists who have been trained to, and train others to, see every patient death as a black mark on their career scoresheet, regardless of how much it might be wished, or how great the harm that is done to the person by prolonging their life, or the fullness of the life they have behind them.
But let us speak no more of policy at this time. My mother is now at rest, beyond the possibility of further harm from patriarchal, preaching politicians or scorekeeping medical lobbyists. For that I am thankful. Her last few days were peaceful, a contrast to her torment and confusion of the last few years. She finally came to a calm, dignified stop in silence, with no struggle. Keats’ wonderful phrase ‘to cease upon a midnight with no pain’ seems so apt, except that it was shortly after lunchtime. I was not there at the end, having had to leave her bedside to return to Sydney two days before her death. But three of Mum’s immediate family were there and were able to tell the rest of us how it went.
What moved me to start writing this note was looking out of the bus window, at the deep blue sky, an overpass soaring majestically over our road (yes, overpasses can soar, it is not compulsory to view them as ugly!), the bright-coloured lorries and cars, and the restful forests ahead. The thought presented itself to me that, though I am going to the funeral of my much-loved mother, life goes on and is full of beauty and sometimes even flashes of joy. She would be glad that I am appreciating the beauty of the day, feeling comfortable and content, at least at this moment, if not always.
Almost instantly I felt transported to the consciousness of somebody, a son or daughter, or a friend, travelling to my funeral, at some time in the future, and experiencing similar feelings. Yes, life will go on after I die and, there will be beauty, purpose and occasional joys for those that survive me.
And so it will continue, to the end of this world. But even then, it will not matter that this world has ended, because there will no doubt be other worlds orbiting other suns, some maybe even in other universes.
These expressions are inept, of course. I am so often too long-winded. I would do better to just say that I felt, in some inexpressible way, that this, this moment, this experience, is fitting, and that there will be similar fitting moments in relation to and after my death and for most other deaths.
Death is nothing to us. Then again it is everything, because without death there can be no life. It is a cliché to say so but nevertheless I will swallow my pride and admit that it is only the finitude of our lives, of our consciousness, that makes life meaningful.
My mother was a very good woman. But stay – I disdain the habit of classifying people as good and bad, so let us instead say that she was a woman who did much good. In so many ways she enriched the lives of those around her. It is a great blessing that she has lived. So it must also be a blessing that she has died, because without dying she could never have lived. That’s looking at time backwards, but why should we not do that? Time is, after all, just a dimension, and the popular metaphor of the “arrow of time” that compels forward motion is much too militaristic for a peacenik like me
I will always remember her. In fact, since she died I have been flooded with memories, some that I didn’t know I still had. Perhaps in the later stages of her dementia my mind protected itself by blocking earlier memories of her, because the comparison between the person she had been and the state to which she was now reduced was too painful. But now those comparisons are gone and the gates have been opened. Mum is free at last. And now my memory has been freed and most of the memories are warm, strong and ….. just good.
It is fitting.
Bondi Junction, August 2018
Post Script: If my memory serves me correctly, this is the first essay I have written about death. I expect it will not be my last. Death is a subject that interests me greatly, and which I often think about (but not usually in a bad way).
Post Post Script: The featured image for this essay is of the character Death from Terry Pratchett’s Discworld series. The image is copyright but I doubt Mr Pratchett (RIP) would have minded, as he had progressive views about death. I very much like the character Death in Discworld, because he is portrayed as being compassionate, which is how I think about death.
It is well-known that multinational companies use complex group structures, involving a rats’ nest of bewilderingly interconnected companies, to shift profits to places where they are taxed lightly or not at all. If the structure is complex enough it can become impractical for government agencies to invest the considerable time needed to understand the structure and work out whether it is hiding something socially harmful. Tax avoidance is not the only practice that can be masked by such deliberate complexity. Money laundering and putting assets out of the practical reach of creditors are other ends that can be achieved. Employment and environmental standards may also be avoided.
This essay outlines a law reform proposal that I believe would dramatically reduce the complexity of corporate groups, and thereby make it harder for them to hide socially undesirable practices. In short, I propose changing tax laws so that money cannot flow through a company without penalty unless its owner has convinced the government that allowing that to happen provides some benefit to society.
Under my proposal, a country, call it N (for nation), would maintain a register of ‘Fair Dinkum’ companies (‘FD companies’), which would include both companies based in country N and companies based in other countries. For my non-Australian readers, ‘Fair Dinkum’ is an Australian adjectival phrase indicating that the person or thing to which it refers is honest and generally wholesome.
Any company, domestic or foreign, could apply to the government of N to be granted FD status. If granted, the company would be added to the register.
The incentive for companies to apply for FD status is that any payment made by a company subject to country-N tax law to a company in the same corporate group would only be able to be used as a tax deduction if the company to whom it was paid is Fair Dinkum.
Requirements for a company C being given FD status, and for retaining it, would be:
- The social benefit test. A convincing argument that granting the status to C would allow beneficial business activity to take place that otherwise could not take place to a similar degree. ‘Beneficial’ means beneficial to society in general, and can be interpreted fairly widely. If the activity creates jobs in an activity that is not regarded as harmful to human well-being, or generates taxable profits that would otherwise not occur, or provides a non-harmful service that people would be expected to want, that would be seen as beneficial. But it is not enough that the social benefit would be expected to arise after the company was given FD status. The government must also be convinced that the same benefit could not be achieved without that status. In particular, there would have to be a reason why the corporate group could not achieve the same goal using the FD companies it already had.
- Company C makes no tax deductible payments to any non-FD company in the group.
- Company C is based in a country that has tax laws and rates deemed by country N to be reasonable. That is, C cannot be in a tax haven.
- If any other companies in the group ceased to have FD status in the previous five years, an explanation of the reason would have to be provided for each one, that removes any concern that the group might be using ‘burner’ companies to flout the intentions of the framework.
- Company C does not own shares or debt instruments of any non-FD company in the group.
- No company in the group has a mortgage or other lien over any assets of Company C, either over individual assets or a floating charge over all assets.
- An application would have to be sponsored by a country-N resident, who would be held personally responsible, under threat of criminal penalty, for the correctness of information provided to the country-N government by company C in support of its obtaining or retaining FD status. This resident will be called the company’s ‘sponsor’.
At the end of each tax year in any tax jurisdiction to which company C is subject, the sponsor would be required to certify that C had met all the above requirements throughout the year, and that the full amount of required tax had been paid to the relevant tax authority.
In the first instance, the tax deduction incentive acts only as a reason for a company in a corporate group that is subject to country-N tax to apply for FD status. However the above set of requirements make that status unattainable unless all companies that receive tax-deductible payments, directly or indirectly, from the first company are also FD, and all companies that are directly or indirectly owned by C are also FD. Hence any corporate group whose structure is deliberately over-complex will be unable to earn profits in country N without a heavy tax burden, unless it creates a very simple, quarantined, sub-structure within its group for that purpose. Because of the simple nature of the sub-structure, it will be very difficult for it to avoid tax, launder money or put assets beyond reach of creditors.
The application would be assessed by officials of the country’s government. A non-trivial fee would be levied to cover the cost of the assessment. Since the assessment would be personal and not automated, this would need to be of the order of one to two thousand dollars.
In order to ease the transition, companies existing at the date of the announcement of these measures would be granted temporary FD status, that would cease after a few years unless a full application had been made and accepted. Companies formed after the announcement date would get no such period of grace.
The status would expire and need to be renewed every few years, at some frequency set out in the law. The renewal process would be less onerous than the initial application, but the company would need to certify that it had not undergone a major change in either ownership or business activity. If it had, a new application would need to be made. The purpose of this measure is to prevent corporate groups from gaining FD status for a company on the basis of one projected use of the company, and then using it for a different purpose, or selling it to another entity that uses it for a different purpose. Spot audits would be conducted on the statements made in renewal applications. The company sponsor, and all directors of the company would be required to sign renewal applications, thereby placing the responsibility on them to ensure the statements were truthful.
A significant change in the business activity of a company with FD status would cause its status to immediately lapse. So companies would need to apply for a renewal of status if their business activity changes significantly. Such an application would be required to be made within some specified period – say three months – after the change of activity had occurred. There would be capacity for the status renewal to be backdated in order to allow companies nimbleness and flexibility of movement, such as a snap takeover bid for which the company would be disadvantaged if the company’s bid became known to the market before the deal was closed. But the backdating would not be guaranteed. If the new activity was not deemed an acceptable use of the status, the renewal would be denied and loss of status would date back to the time the new activity commenced. Again, if it was discovered through spot audits or other means that a FD company’s business activity had significantly changed and the company had not either applied for renewal or relinquished the status within the specified period (again, say three months), the directors of the company would be liable to criminal penalties.
Here, a ‘change in activity’ is not so much about a decision to add a new widget to the range of widgets the company currently makes. That would create undesirable bureaucratic obstacles to good business practice. Rather, it is about opening up new channels by which significant slabs of the company’s revenue either come in or go out to/from other companies within the group. Details of this would be encoded through relevant definitions in the law.
Impact of, and Reasoning Behind, the Proposal
Under the proposed framework a non-FD company could no longer be used as part of funnelling profits through labyrinthine channels to move them either to a low tax jurisdiction or from a jurisdiction with lax controls on money laundering. Why? Because these labyrinthine structures rely on money coming in to such a company and then going straight out again, with no tax impact. But for a non-FD company the money coming in would be taxable while the money going out would not be, making the transaction economically non-viable.
The reason for the non-deductibility of intra-group payments to non-FD companies may not be obvious. There will often be worthy reasons for company C operating in country N to set up a local subsidiary that conducts its sales and other operations there, so FD status will be easily achieved for such a subsidiary. But we do not want to allow profits to be shifted from that company to an offshore company that is subject to a less careful regime, where they may be eventually channelled to a tax haven. Dodges such as ‘transfer pricing’ make this easy to do and hard to police. Requiring the recipient company to be FD would make this much more difficult. For a start, the criteria deny FD status to any company in a tax haven, even if that company is the group’s ultimate parent. Secondly, no group company to which the domestic subsidiary transferred revenue by anything longer than a very short chain would be granted FD status. It is hard to imagine any genuine reason why payments should have to pass through more than two intermediate sets of corporate hands within a group before reaching the ultimate parent company. If this rule forced a company to channel payments from country N to the parent company via a shorter, simpler route than that used for payments from subsidiaries in other countries, that is a consequence of the group’s choice to have a complex global structure, and it is in the group’s power to change that if it does not like having to deal with the extra accounting work involved in having two separate payment streams. Note also that the constraint on payments is only on tax-deductible payments and so would not include dividends on ordinary shares.
We can imagine that less scrupulous companies might seek to develop sneaky ruses such as bouncing revenue off a non-group company in a tax haven and then back into the group through a sweetheart deal with that external company, in order to avoid the tax deductibility problem. However any such ruse would need to be highly contrived and would be subject to the usual rules and penalties that apply to any arrangement that is constructed with the primary aim of evading tax.
I have not managed to convince myself of the impossibility of avoiding some amount of tax in the year in which a company ceases to be FD. As soon as a company relinquishes that status it is free to make any payments it likes. I can imagine a company somehow storing up wealth in a tax-effective way while FD and then suddenly ceasing to be FD and paying the stored wealth out to a group company in a tax haven. But I think the potential for such abuse is limited. Firstly, the accumulation of wealth cannot span across tax years, as the company has to either pay a fair amount of tax on any profit in the year it arises or lose FD status. Secondly, if the company is subject to country-N tax, it would not get a tax deduction for the payment. Hence the profits that built up the payment would be fully taxed. It is conceivable that some losses may occur in the year of ceasing to be FD, but that final year would be only a small part of the time that company is FD, as long as the group doesn’t churn FD companies. Such churn is prevented by the requirement within the application process to justify any cessations of FD status within the group.
Potential Reaction, and a Comparison to the History of Companies
Extreme free-market libertarians might howl in protest, liberally sprinkling their complaint with terms like ‘red tape’. But it would be in vain. First, this proposal would cut red tape, not increase it, since it would dramatically reduce the number of companies in a corporate group, and hence the amount of pointless legal and accounting work, not to mention subsidiary board meetings, that the presence of all those companies necessitates.
Further, the suggested action is not unprecedented. Commercial companies have only existed since about 1600, when the East India Company was formed, followed by the Dutch East India Company in 1602. Formation of these companies required royal assent, which presumably required quite a high level of work, cost and currying favour to get it granted. In 1720 the British government forbade the establishing of companies by the British Bubble Act, which remained in force until 1825. Limited Liability did not become a feature of British corporations until the Limited Liability Act of 1855.
It was only in the early twentieth century that the widespread use of companies really took off. I don’t know when the creation of labyrinthine corporate structures using two-dollar shell companies began, but I suspect it was much more recent than that.
So we see that companies have only been a feature of the economic landscape for a small part of the period in which international trade and other economic activity occurred, and for a large part of even that short time, the formation of companies was very far from the rubber-stamped, automatic right that it is taken to be now.
Conclusion and Commendation
Nothing in this is proposal is hostile to the formation of companies. I fully accept the argument that allowing companies to be created enables business to be generated, with the social benefits of employment, services, profits and tax revenue following from that. But it is exactly that social benefit that my proposal would require to be demonstrated before allowing a company to be used. Demonstrating that would be very easy for companies that actually do useful activity, and for most non-shell companies that have existed since companies were invented. But it would be very difficult for a company whose sole purpose is to complicate a labyrinthine structure and thereby aid in tax avoidance, money laundering or otherwise evading a corporate group’s responsibilities to the society without whose rule of law it would not be able to function at all.
Implementation of this proposal would make a national tax office’s task of ensuring that appropriate levels of tax are paid by a company that sells goods and services in that nation much easier. It would make money laundering more difficult and it would make it harder for companies to put their assets out of reach of deserving creditors.
I commend this idea to the law makers of the world, in the hope that some nation may take it up, and maybe start a trend leading to most nations doing it. Of course, implementing the proposal would not prevent all tax evasion, money laundering and other corporate hoodwinkery. But I believe it would greatly reduce it.
No doubt there will be some wrinkles to be ironed out and perhaps some unforeseen obstacles to be surmounted, but I am hopeful that the core of the idea is sound, practical and effective. This essay may change as people point out loopholes that need to be closed, or undesirable obstacles that such a framework would create, and the proposal adapts to remedy those. At worst, somebody may point out a fatal flaw in the proposal, in which case it will become petrified as a monument to the powerful yet hard to fulfil human wish to stop or at least reduce exploitation by the rich of the not so rich.
We shall see.
Bondi Junction, March 2018
I am fed up, completely fed up.
Too many times have I listened patiently while people with strongly-held but not-critically-examined opinions explain that the trouble with politicians these days is that most of them have never held a ‘real job’ (see list of examples of media whinges at the end of this article).
I am generally too polite to make the obvious retort: ‘Oh, I didn’t know that some jobs were real and some were pretend. Which ones are the real ones then?’
A favourite here in Australia is to hold up the example of Ben Chifley, who worked for the railways for a few years. Ironically, those for whom he is a poster child eulogise him for ‘having worked as a train driver’, little knowing that train driver was – at the time Chifley did it around 1912 – a very prestigious position – the pinnacle of the railway industry. Hardly the sweat-of-the-brow, in-touch-with-the-common-man position that people dream it was. Chifley did work at lowly, manual jobs in the railway trade, including shovelling coal, but that was in order to work his way up to the lofty (some might say ‘ivory tower’) position of train driver.
When the criticism is made, it usually includes union organiser among the ranks of ‘pretend jobs’. I find that criticism astonishing. A good union organiser is a combination of human rights barrister, public relations consultant, aid worker, counsellor, logistics engineer and CEO. The job sounds so hard to me that I can’t imagine any amount of money being enough to induce me to take it on. They have to persuade people to join unions, negotiate with powerful business interests, chair union meetings to try to get workable decisions from groups of employees that may have quite disparate aims, organise strike funds, conduct legal battles against laws aimed at removing any remaining negotiating power of employees against their big business employers, et cetera, et cetera, et cetera. Given the skill set needed to be a successful union organiser, I imagine any business looking for a new head of HR, finance or operations would be happy to take them on – as long as they promise not to organise any strikes.
Yet, somehow, all that activity is not regarded as being a ‘real job’. I have nothing against real estate agents, pathologists, car vendors, fast-food checkout operators or NHS statistics processors, but I cannot see what life experience or exposure to the ‘real world’ those jobs provide that being a union organiser does not.
Another apparently ‘pretend job’ is being a political aide. I don’t know much about political aides but, from the outside, it seems such a job would be a combination of super-PA and media advisor. They have to make sure the MP or candidate they advise gets to all their engagements in time and is briefed on the issues they need to know about, as well as being properly dressed, fed, rested and toileted. Hardly a walk in the park. And hardly a low-skill profession.
But is it something else rather than a lack of skill that is being insinuated about political and union jobs? If so, what exactly is it? Does the job have to be strenuously manual and involve almost no brain work in order to be ‘real’? Then a brickies’ labourer has a real job but someone gutting fish in a cannery does not? That makes no sense to me. And why does there have to be no brain work? Is that just the current anti-intellectual fashion playing out? Are people with clever minds required not to use them in order not to stand out from the crowd and seem elitist? Could it not just be possible that if somebody has a clever mind it would be better employed trying to find ways to raise the wages of the working class or make sure that our politicians are actually well-informed on the issues they are deciding, than in digging a ditch? The good book itself tells us (No, not the HitchHikers’ Guide to the Galaxy. The other one), in the Parable of the Talents, that it is a sin not to use the talents you’ve been given.
Often the accusation of politicians ‘never having held a real job’ is equivocated with the accusation of ‘never having experienced real life’. This is as nonsensical as the other lines of attack. The challenges of real life are things like trying to find a home to rent, save up money and maybe eventually borrow to buy a home. They are going through the joys and pangs of love found and lost and maybe searching for a life partner. They are trying to carve out a sense of purpose in a world that is a babble of noise, shallowness and competing interests. They are trying to find communities to which one can belong, to gain acceptance in them and then work to benefit the community and to help it achieve its goals.
I think most of these are experienced by everybody, and all of them are experienced by most people, regardless of their chosen occupation. The occupations that are least exposed to these challenges are those that are tremendously well-paid – investment banker, business tycoon or senior barrister. Yet somehow those are regarded as ‘real jobs’ while being a lowly-paid political aide or union organiser is not.
The phrase ‘out of touch with real people’ is another popular one to throw around. Again one wonders what one needs to do to be a ‘real person’. How can I tell if I am one? Wouldn’t it be terrible if, after years of thinking you were a real person, you suddenly discovered you were a fake? Could you demand a refund? From whom, I wonder?
I think what they mean is just ‘has regular contact with people that don’t work in unions or politics’. Well that criticism doesn’t stand up to scrutiny either. Most of a politician’s day seems to be spent meeting people, and only part of that is with other politicians. As an MP they have to meet whatever constituents ask for a meeting, within reason, and my understanding is that they do plenty of that. If you have a grievance, make an appointment to go talk to your local MP about it, rather than sitting at home whinging!
Now senior ministers don’t do much meeting with constituents, because the other demands on their time are so great. But the only people that get to be a senior minister without serving their time as a backbencher – with all the time ‘meeting real people’ that that entails – are those that come straight into parliament at a senior level, typically from a career in either business or law, two professions that are mystifyingly regarded as ‘real jobs’ even though the average big businessman or senior lawyer meets far fewer working class people per week than just about any politician. Those that have to work their way up as a backbencher before becoming a minister will have had plenty of exposure to ‘real people’. Are we then going to complain that, once they are Treasurer or PM, they should set aside a large proportion of their precious time for yarning with locals at the pub, rather than spending that time studying and reflecting on the pros and cons of an important decision that will affect the lives of millions of citizens? If we want to make that criticism, why do we not also make it of the senior people of any organisation, be it a business, a church, a charity or a sport federation? Why should politics be the only profession in which one is expected not to devote one’s efforts to making the best decisions possible, and achieving the best possible outcomes.
Now I’m not suggesting that all politicians do spend all their time studying and agonising over policy. If they did, the policy would never be enacted. In business, selling a product is as important as designing and manufacturing it. A business that devotes all its efforts to the latter and none to the former will soon be a dead business, and the same applies in politics. If politicians have a policy they believe is worth selling, they need to put their utmost into selling it and, because of the adversarial nature of our political system, that will always be a difficult job. Selling it means speeches, private negotiations, cajoling, counting numbers, nurturing votes from fence-sitters, and so on. It’s a really hard task, and not one I’d have the stomach for. But it has to be done. Otherwise somebody else with less benevolent motives – a Putin or Trump – is likely to get up and sell their alternative, and we’ll all be worse off.
A good policy needs effort to sell it, and that effort is worthwhile. Where I get cross at politicians is when they cook up useless or even harmful policies solely in order to sell themselves, ie to increase their popularity and thereby the likelihood that they will retain power. They may be selling themselves to the public, as is the case with politicians that flirt with the xenophobia that can always be found in any population under a moderate amount of stress. Or they may be selling themselves to a king-making power group within their party or to powerful financial backers. The current Australian PM seems to have sold off so much of himself to those groups that he is now indistinguishable from his reactionary, climate-change-denying, Muslim-hating, would-be-theocratic predecessor, with the sole exception that the predecessor at least had the virtue of being true to his own values.
Politics, including being a political aide or a union organiser, is a tough job. You have to work really hard, for pay that is much lower than you would get if you were working that hard, and with that level of skill, in private industry. You have to endure public hatred, mockery, accusation and vilification. You are always at work – none of your time is your own. You are regularly confronted by failure and heartbreak, when you lose an election or maybe just fail to get approval of the policies you believe in. You are always on the move, often living out of hotel rooms rather than in the comfort of your own home.
The way I see it, a job in politics is as tough and as real as it gets and, as long as they are not using their position to corruptly enrich themselves (which, mercifully, is fairly rare in my country, and in most other OECD countries) politicians deserve our respect for that, even if we vehemently disagree with their policy proposals. Someone who has always worked in politics has always had a tough job, more so than somebody that spent their first ten years after uni at Wernham Hogg, playing office pranks like putting their co-worker’s stapler in jelly (not that I have anything against office workers. I’m sure they can be good citizens and lovely sons or daughters-in-law too).
So let’s all stop whinging about our politicians’ backgrounds and start engaging with them about their policies.
It’s all just so silly. If we were to apply the same standard to other professions as we do to politics we’d have job interviews containing lines like:
‘The university is very impressed by this thing you’ve invented called Gravity, Mr Newton, but what we really need to know before we consider employing you as a research fellow, is whether you have had any experience as a blacksmith’.
Bondi Junction, March 2018
In searching the internet for examples of this opinion I have been railing against, I came across a couple of reasonable-sounding defences of the view. While they do give pause for thought, I am not persuaded by them. Here they are.
Argument 1 – Requiring a previous career screens out the young
This argument says that, if a starting-out politician has already had a career in another profession, they are likely to be at least middle-aged, with the wisdom and life experience that people generally expect to come with age. It is undeniable that life experience accrues with age, and most people would agree that wisdom generally increases with age for most people, at least until dementia sets in. But very few people would argue that we should therefore only allow people aged over forty to enter politics. That would be a very different, and highly controversial argument, and while it may have some points in its favour, I would not be inclined to back it. Furthermore, it would be an argument about age, not prior profession, and would exclude people who had worked in bakeries, hair salons, at building sites and at law firms as much as it would those who had worked in unions or political offices. So I don’t see this argument as providing any support to the ‘must have worked at a proper job’ case.
Argument 2 – Having a fall-back career allows greater integrity
This argument says that, if somebody has worked successfully in another occupation, they have the option of returning to that occupation if their political career doesn’t work out. Hence, the argument goes, they can tell the party’s Chief Whip to get stuffed when she demands that the new MP vote along party lines for a bill with which the MP does not agree. Somebody who does not have a fall-back career may follow the Whip’s orders because they fear that if they do not, they will lose party pre-selection and hence lose their job at the next election.
I don’t find this convincing either. Somebody that has worked as a unionist or a political staffer will have developed skills and experience that enable them to return to working in that capacity just as easily as one can return to working in an office or a hospital.
Secondly, if we pursue the logic of this argument, we should favour politicians that are rich, because they don’t need the salary and hence will presumably have greater integrity. Experience shows again and again that that is not the case. It is the lure of power, not money, that makes many rich people still desperate to retain their political appointments. Australia’s current PM is enormously wealthy, wealth gained from working so-called ‘real jobs’ (ie lawyer and investment banker), and yet has comprehensively sold his integrity to the reactionary right of his party – an influential group that opposes every value that the PM used to stand for – just so that he can hang on to his position as party leader, and hence PM.
Thirdly, it is not a tautology that a system in which MPs vote according to their individual views, without any sanction for departing from the party line, leads to better, more democratic, outcomes. Sure it sounds good, the idea that our representatives follow their conscience. But in practice in can generate some very unsavoury results. Party discipline may be oppressive but it also provides a defence against manipulation by powerful lobby groups. Nowhere is this more evident than in the US Congress, where the NRA targets individual MPs in non-safe seats, threatening them with a targeted hostile campaign at the next election unless they vote against gun control bills, even if their own party is promoting those bills. The reason the NRA can do that is because party discipline is so weak that it easily outbalanced by the NRA’s threats. If party discipline were such that voting against the party line would mean losing pre-selection, and hence losing the seat anyway, the threats of groups like the NRA would be futile. It is certainly arguable that one reason US politics is so much hostage to certain sectional interests is the ability of those interests to target individual MPs, something that cannot happen in countries with tighter party discipline like the UK or Australia.
I am still not entirely sure whether the benefits of party discipline outweigh its disadvantages (although given the recent terrible gun tragedies in the US, it’s hard not to lean that way), but regardless of one’s view, it is certainly far from self-evident that making it easy for MPs to vote against their party’s policy would be a good thing.