Australian Federalism in a Globalizing World

Allan Patience^*

[This paper represents material for a book chapter, and so references other contributions to that book not available here - Ed]

Introduction

Australians are turning away from politics. The mainstream political parties are every day more distrusted. We seriously doubt that the media is capable of discovering - let alone reporting - the truth. Ordinary people struggle to comprehend and respond to what appears to be an encircling global mayhem. Political processes have become technocratic and exclusive. We are resigned to the fact that our politicians are now ego-driven careerists rather than practitioners of what Max Weber called ‘politics as a vocation’. Machiavellian minders corral Ministers away from advice and information they don’t want to hear. Parliament has become a bear-pit where MPs routinely posture and dissemble, while enthusiastically feathering their own nests at taxpayers’ expense. Access to leaders is only for the rich and powerful, especially if they make large donations to party coffers. Party bosses and their machines choose whom to endorse for elections and, in some cases, which candidate will be elected. We feel in our bones that our political arrangements should be more honourable, more inspiring. But so long as our hip-pocket nerves are not tweaked too painfully we ruefully put up with the rorting and petty corruption in contemporary public life. We do so, not because we approve of what’s going on, but because politics has become a burden we are required to endure, like flailed bullocks in heavy harness. The very foundations of a modern democracy - participation, informed robust debate, a well-resourced public education system, a capacity to listen respectfully to opponents – seem no longer relevant. The heart has gone out of the nation’s political life.

Since the collapse of the republic referendum, this turning away from politics has become especially noticeable at the level of our awareness of civic institutions. As one report notes:

…there is evidence that Australian citizenship is in need of restatement, and that more could be done to promote informed and active citizenship. Deficiencies of knowledge, capacity and civic confidence are apparent’ (Civics Expert Group 1994: 13).

Few of us understand - much less care - that we have a constitution at Commonwealth level and another at State or territory level. Those who do know of the federal constitution mostly see it for what it is: a dry–as-dust document assigning powers to one group of politicians over another. It is not steeped in democratic rhetoric, like the American Constitution. It is incapable of inspiring an enduring admiration for political representation, human rights, freedoms and duties (the ‘politics of recognition’), the separation of powers, and the civilizing idealism inherent in classical democratic thought. It delivers to us only a partial separation of powers, permitting the Executive to dominate - and manipulate - the Legislature. It obtusely assigns specified (‘enumerated’) powers to the centre (Canberra) leaving the rest to the States, in the mistaken belief that this will guarantee Canberra’s subservience to powerful States. This less than visionary formula became irrelevant almost from the moment the constitution was promulgated. The centre is now all but supreme while the States have become the rotten boroughs of twenty-first century Australian politics.

Looming over all this, like a neo-gothic cupola from a Petty cartoon, is the political encumbrance known as the Australian federal system.

Two Rationales for Federalism

It is helpful to distinguish between two great rationales for federalism. The first results in what I refer to as the pragmatic federalism; the second leads to what I identify as democratic federalism.

(i) Pragmatic federalism is an administrative – and short-term - solution to a political problem. Its prime purpose is to persuade a number of hitherto self-governing polities, each reluctant to surrender their sovereignty, to unite into a larger, coordinating structure (the federal system) in order to achieve certain ends that are judged to be desirable. The hard-nosed measures of this sort of federalism would emphasize economies of scale that are calculated to be achievable within the proposed federation. For example, its advocates will talk up the advantages of a larger economy (especially an expanded domestic market) and/or more reliable security guarantees. Pragmatic federalism is therefore likely to be seen to be good for business and good for those who want expanded military capabilities.

(ii) Democratic federalism arises from more idealistic motives. It is first and foremost about dispersing power away from a dominant central government, simultaneously broadening representation. It seeks to ensure that the voices of smaller or less powerful members will not be swamped by the larger ones. One of its prime functions is to give those at the margins a say –extending, as Professor Davis (1995: 2) points out, ‘… the virtues of choice by diffusing the centres of authority’. In this sense federalism’s over-riding aim is to creatively accommodate regionalism and diversity within a benevolent and enabling form of political unity. And this federal accommodation is expected to deliver greater public good and freedom to all than would otherwise be both possible and manageable.

Australia’s Pragmatic Federalism

It is simply not true to say that the Australian federal system was framed as a philosophical response to the kinds of ethical and sociological challenges thrown up by diverse cultural, ethnic, linguistic, religious, and political differences among the colonies in the nineteenth century. The system did not arise from a search for a political compact that would guarantee the moral and communitarian integrity of such diversities within a democratic constitutional framework. Far from it. It amounts to little more than a set of pragmatic, legalistic and administrative compromises intended to shore up parochial interests imagined by men of influence in the Australian colonies at the end of the nineteenth century. For all their attempts to write these compromises as if they were the founders of a nation, they were, to echo Alfred Deakin (1995: 167), very like their constituents:

They did not philosophise, they did not hold their creeds too profoundly, they did not brood over them or debate them except for the amusement of combat or vaticination. They took their politics like their pleasures somewhat sadly and even more spasmodically with as little theory and much less heartiness.

At best they were practical men, mostly autodidacts, some ambitious and vain, some principled and reasonable, a few inspired by a dream of a greater Australia, some with various levels of legal understanding, most with the minds of small businessmen, not a few with ambitions exceeding their capabilities, one or two who were truly great.

The results of the labours of our federal planners mean that Australian federalism is none other than a working example of pragmatic federalism. While the most powerful reasons for federation arose from perceived economic advantages and defence vulnerabilities, the decision for a federal over a unitary system of government was substantially a consequence of two quite practical conclusions that loomed large in the finite intellects of most of the founders of the Commonwealth of Australia.

First, self-interest directed the founders to look to a federal arrangement. Most of them were singularly under-whelmed by the thought of sacrificing their local power bases on the alter of a unitary system of government. While offering a grander stage for them to strut upon – grander, not a few of them expected, than their colonial power bases - a unitary central government that took over all powers of the six colonial parliaments would provide fewer plumbs to be picked by the politically ambitious in the colonies. In addition to seats in the Upper and Lower Houses of the State parliaments these plumbs would come in the form of additional seats in the House of Representatives, or in the Senate where a title was to be had as well. A federal system would permit them their local cake and let them eat it at federal level. What was the better bet: one central parliament (as in New Zealand or Great Britain), or six State parliaments and a Commonwealth parliament? Federal proposals that guaranteed seats in State parliaments, plus the Commonwealth parliament, held out the real and seductive possibility of more jobs for the boys (and, rather later, the girls). It continues to do so to this day.

Second, as Geoffrey Blainey (1968) has explained, distance was a major formative factor that helped influence the political leaders in the Australian colonies to look for a federal compact at the end of the nineteenth century. In their limited ways of seeing the issue, the founders concluded that vast geographical distances were regional differences – i.e., unique parochial imaginings of place and identity; specifically local loyalties deserving (in their somewhat grandiose view) respect and protection; differences that could not be accommodated outside a federal arrangement. Of course, this kind of rhetoric also provided a convenient rationale for the naked self-interest, the private ambitions, that compelled colonial politicians to favour maximizing their chances for parliamentary careers within an expanded federal system.

This was despite the fact that the new Commonwealth was to be based on an unswerving determination to be racially, culturally, and politically homogenous. As Helen Irving (1999: 100) notes: ‘The issue of ‘colour’ was unequivocally a racist issue, but it was much more than this. It was a type of cultural strategy in the process of nation-building’. This strategy was aimed, first and foremost, at creating a white and British society and polity within an indissoluble Commonwealth under the British crown. The language would always be English. The customs and values would be indubitably Anglo-Saxon, if not Anglo-Celtic. The political and legal institutions would all be derived from British traditions. A culturally homogenous people – ostensibly a white British race - spread thinly over the vast distances of the Australian continent was to be politically and geographically arranged within a federal system of government. It was not so much a question of democratically managing cultural or social diversity within a framework of republican political unity rather than reacting – unimaginatively - to the ‘tyranny of distance’.

It is difficult therefore to point to Australian federalism as a noteworthy political achievement. As far as this goes it is no doubt an historically interesting structure, though increasingly ramshackle and out of step with the globalizing times. But its over-all arrangement is without poetry and philosophy. Its pragmatism is its all; its democratic symbolism and content are frankly threadbare. We would be foolish to expect it to inspire an enduring and evolving democratic political system, a responsible and representative state, or republican statesmanship. It is not a crucible for conjuring up great politics. Australia’s considerable political development since 1901 has more often been despite the federal system than because of it.

The Centralization of Power

The intentions of the founders of the Australian federal system were clear and considered. They wanted to devise a constitutional arrangement – in effect more a confederation than a federation - in which the centre (Canberra) would be the servant and supplicant of the powerful States. We know that the best laid plans of mice and men can go off the rails. This is certainly so in the case off Australian federalism. As is now widely taken for granted, the intentions of the founders of the Australian federal system were well and truly high-jacked, almost from the inauguration of the new Commonwealth of Australia on the 1 January 1901. The usual explanation for this includes the recognition that the powers listed (‘enumerated’) in the Constitution as belonging to the Commonwealth have enhanced the significance of the centre at the expense of the States. Powers like Foreign Affairs, International Trade, Immigration and Defence have all taken on a far larger significance in the twentieth century than the rather backward looking nineteenth century constitutional ever anticipated they would. The role of the High Court in elaborating, rather than limiting, the powers of the centre at the expense of the States is regularly cited as a major reason for up-ending the federal balance in Australia (e.g., Menzies 1998). The States’ loss of income taxing powers because of the Emergency powers of the Constitution during World War II is said to have handed the power of the purse strings to the centre. Added to this, we may note, is the fact that talent has tended mostly (but not always) to be attracted to a political or bureaucratic career at the centre.

What is not so widely canvassed is the fact that the accreting of power to the centre has been significantly hastened by the traditionally high salience of government in everyday Australian life. This is point was clearly spelt out by Professor Encel (1970: 205) in his classic account of class status and power: ‘Australia differs from other democratic countries partly in the earlier historic acceptance of state intervention as the normal means of evolving and implementing social policies, and in its more rapid advance since then …’ While it is fashionable in these neo-liberal times to down-play the role of the state in favour of the private sector (Quiggin 2003), the fact is that the state in capitalist society remains a major locus of power and action, one that absorbs the energies of powerful politicians, bureaucrats and other peddlers of influence (including the media). It still plays a fundamental and powerful coordinating – even, arguably, a determinative - role in the economy and society. What Professor Weiss (1997) rightly calls ‘the myth of the powerless state’ should not distract us from the on-going - and expanding - role of the state, especially in its Australian context. Despite the rantings of antique Marxists and, more recently, the ravings of economic rationalists, the state has not withered away. It may be changing, maybe even comprehensively, but it is not in decline (Skocpol 1985; Weiss 1998; Hobson 2000). Thus, the state in late Australian capitalism is of immense historical, political, and economic consequence and this consequence, overwhelmingly and increasingly, has been irrevocably attaching to the centre. It will continue to do so, and increasingly, as globalization unfolds (Wiseman 1998).

Ramshackle Federalism

The result has seen the federal system in Australia fall into a kind of malaise that is not widely understood in the community but which contributes unhealthily and aggressively to the turning away from politics that we see happening in contemporary Australia.

The malaise I am identifying here may broadly be sketched as follows.

First, within Australia we conduct our daily lives within at least three routinely uncoordinated and not infrequently contradictory tiers of government: Commonwealth, State and local. If our work and commitments take us beyond one State or territory, that could mean that we have to deal with up to a dozen or more different jurisdictions and administrative zones. Gough Whitlam’s (1983) witty caricaturing of this is instructive. One may be forgiven for thinking that this results in Australians being over-governed yet under-represented. While we could argue about the numbers of elected representatives the federal system should oblige us to vote for (or against), and pay for through taxes, what we do need to question is the quality of representation that the system delivers. The resulting plethora of politicians is not noteworthy for the excellence of representation that they deliver. Some representatives, through all levels, are undoubtedly effective and dedicated when they work for constituents or as they perform as Ministers of State. Nonetheless, in gender, ethnic, regional, cultural, religious, ideological and socio-economic terms, the system does not deliver even an approximate representation of the wider community. Indeed, it may well be said to block the possibility of good representation.

Second, the financial arrangements of the Australian federal system result in opaqueness, a lack of accountability and a great deal of extravagant buck passing between State and Commonwealth governments. The Commonwealth holds the purse strings; the States are increasingly constrained in spending the disbursements granted them by the Commonwealth. At the same time the States’ means for raising funds in addition to Commonwealth disbursements also narrows. Hence we see States relying increasingly on raising extra revenues through gambling taxes or similar potentially anti-social avenues. As Owen Hughes (1998: 275) notes:

The result is arguably the worst system of federal/state finance of comparable federal countries. Today, states complain continually about unfairness in the distribution of funds while the Commonwealth considers the states profligate. The Commonwealth feels it attracts the political odium for taxation, while the states gain the political benefits of spending. Citizens, meanwhile, often do not know which level to blame for any shortfall in public services.

Third, If we calculate where the most corrupt and incompetent levels of politics arise in the Australian political system, we would be obliged to point immediately to the States. The shocking catalogue of WA Inc., failures of State banks in South Australia and Victoria, criminal trials and some convictions of leading politicians and public servants in Queensland and New South Wales, points to a malaise at the heart of State political cultures. Arguably this is in part a function of the growing impotence of the States. Their politicians have little to do but try to rort the system. In some State contexts this rorting has become an art form.

Fourth, the irrationalities of the Australian federal system become starkly evident when we consider some of the serious threats to the environment that arise in the neglect and mismanagement over many decades of, say, the Murray-Darling River Basin, or the increase in land salination. One of the central causes of these kinds of problems is the stupid division of power – and the even stupider interests that are mobilized because of this division – inherent within the federal system itself. And the problem of federal irrationality is not confined to environmental matters. Health, education, criminal law administration, and many other related areas all regularly fall foul to a bizarre lack of coordination between the States themselves and between the States and the Commonwealth within the Australian federal system.

Fifth, we more often than not observe States competing against each other for international investment, trade opportunities and ‘big events’. Whether this be New South Wales and Queensland competing for coal markets in Japan, or Victoria and South Australia trying to outdo each other to attract a major American car manufacturer to build a large manufacturing plant in Adelaide or Melbourne, the result is the same. The national interest is seriously neglected while parochially-minded States fling incentives and other extravagances at potential investors heedless of the broader public interest. In the latter case, for example, the factory went to Melbourne when it could be argued that it should have gone to Adelaide where jobs – especially in the manufacturing sector – and the State economy in general are in decline.

The fundamental flaws in the federal system are structurally incorporated within the system itself. It is not that the system has fallen on bad times, or that it has become a victim of bad political management. It is the case that both of these problems are festering away with in it, compounding its irrationalities and confounding those who would require good governance, a republican democracy and a viable future for the sovereign state of Australia. Yet the problems are symptoms of a far greater pathology – the entire federal system itself. And gathering in the wings are the dangers implicit in globalization. Australian federalism’s manifest structural weaknesses are a real threat to Australia’s capacities to weather the gathering storms of globalization. They could well prevent our politicians from navigating a safe passage through to security and prosperity.

Globalization

Since the end of the Cold War the world has seen a dramatic increase in what Richard Falk refers to as ‘predatory globalization’. As Falk (1999: 127) explains:

The negative essence of this dynamic, as unfolding within the present historical time frame, is to impose on governments the discipline of global capital in a manner that promotes economistic policymaking in national arenas of decision, subjugating the outlook of governments, political parties, leaders, and elites and often accentuating distress to vulnerable and disadvantaged regions and peoples.

And, as Professor Falk goes on to argue:

Among the consequences is a one-sided depoliticizing of the state as neo-liberalism becomes “the only game in town,” according to widely accepted perceptions that are dutifully disseminated by the mainstream media to all corners of the planet. Such a neo-liberal mind-set is deeply opposed to social public sector expenditures devoted to welfare, job creation, environmental protection, health care, education, and the alleviation of poverty.

It is within this global environment that we now need to re-evaluate the Australian federal system. Can a highly fragmented federal structure – one that is shaped by an out-of-date constitution whose framers failed to anticipate the twentieth century, let alone the twenty-first century – steer Australia safely through the reefs and shoals of predatory globalization? However nostalgic we may feel about States, however committed to the ideals of democratic federalism, the answer to this question has to be a resounding No!.

The authorities most directly responsible for the kinds of social sector spending and administration that Falk nominates as being at risk from predatory globalization are almost all within the purview of the States within the Australian federal system. Prior to the arrival of predatory globalization on the world stage, the States were already failing to deliver in these vital areas – areas that must be well managed by governments if their citizens are to withstand the inroads from this negative version of globalization.

Clearly therefore the challenge now facing those committed to good governance in Australia is to re-imagine political arrangements that will position the sovereign Australian state to deal strongly and effectively with the impact of predatory globalization. However this re-imagining will be impotent if it can only come up with a simplistic unitary system to replace the federal system. In the face of predatory globalization old unitary systems of government are as outdated the present Australian federal system. Hence we can see the very interesting growth of devolution in Scotland and (hopefully) Northern Ireland within the United Kingdom and as may be evident in the impressively widening membership of the European Union.

There is a regionalism in Australia that will have to be democratically (rather than administratively) accommodated into a flexible and vibrant system of Australian governance. It is a regionalism that is vastly more numerous and complex than the ‘regionalism’ that poses as such within the current State boundaries. Among a small number of visionaries focusing on this very important problem is former federal MHR Chris Hurford whose contribution to this volume should become basic reading for all citizens interested in good governance.

For it is only a strong sovereign state, one that is anchored in a strongly regionalized democratic polity will be well placed to cope with the vicissitudes of predatory globalization. At the same time this kind of state will need to be able to engage fully and successfully in what Professor Falk identifies as a second form of globalization – ‘globalization-from-below’. This

… consists of an array of transnational forces animated by environmental concerns, human rights, hostility to patriarchy, and a vision of community based on the unity of diverse cultures seeking an end to poverty, oppression, humiliation, and collective violence. Instead of a New World Order, this type of globalization inclines toward a one-world community… This … community rests upon the strengthening over time of institutional forms and activities associated with global civil society (Falk 1993: 39).

Few of us will be ready to contemplate the possibilities and potential benefits of a global civil society if we feel insecure or marginal within our own sovereign states. Indeed the rise of One Nation populism in recent years must be understood as very real responses by insecure, bewildered and sometimes despairing people to global pressures and globalizing threats they feel are closing in on them. We all need a firm foothold in our own political territories, an educated grounding in our own local political cultures, before we can imagine ourselves accommodating what John Keane (2003: 1) is referring to when he argues that a ‘… new world-view, radically different from any that has existed before, has been born and is currently enjoying a growth spurt: it is called global civil society’. The appalling threats of war and terrorism will very likely only be curtailed if we learn to ‘sing’ (to borrow an Aboriginal term) global civil society into being (Kaldor 2003; Dupont 2001). And that ‘singing’ and the ‘song lines’ it may produce will come from people with a profound sense of place and tradition, not from peoples who are footloose and displaced by political arrangements that fail to give them good governance and security.

Conclusion

As noted at the outset of this essay, Australians are turning away from politics. I have sought to indicate how we may identify the Australian federal system as part of the reasons for this growing and terrible alienation from political institutions, processes and personnel. The time has come for statespersons to start conversations throughout the Australian polity that are centrally concerned with good governance. At the heart of these conversations serious but lively debate needs to be commenced that will clearly inform us about the devastating failures of our present federal arrangements. Politicians who set their faces against serious talk about necessary constitutional reforms are exercising bad – potentially fatal - leadership. Their influence must be confronted; their self-serving prevarications cast aside.

It’s time for the Australian polity to transform itself, to grow tall and intelligent in a globalizing world, to offer ideas, models of multicultural harmony, and a love of fairness and justice to a world that lacks these fundamental necessities for a civilized life.

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