Archive for ‘Parliament’ Category
Now that the Kitteridge and Neazor reports have been tabled, discussion can more fully proceed to the issue of intelligence oversight. The government has proposed bolstering resources for the Inspector General of Intelligence, and adding a Deputy Inspector General to what until now has been a one man shop. That is a step in the right direction, but it falls very short of the mark when it comes to robust, independent intelligence oversight mechanisms. Here I outline one way of achieving them.
Currently the IG is dependent on the NZSIS and GCSB for resources and cooperation and answers to the Prime Minister. That puts him at the interface between politics and operational matters in a chain of responsibility, which reduces his freedom of action.
The IG’s office should be strengthened in terms of staff and moved to become an agency of parliamentary services. It will answer to the Parliamentary Committee on Security and Intelligence, although its staff and funding source will be independent of the Committee. The Committee will have powers of compulsion under oath that allow it to force intelligence managers to release operational details or classified information to it upon request. It would meet at least once a month and receive scheduled classified briefs from the directors of the SIS and GCSB as well as senior managers in the DPMC handling intelligence flows. At any time the Committee would be able to order the appearance in special session of officials from the Police, Customs, Immigration, Treasury and other agencies that employ intelligence collection and analysis services.
All of this would require that the staff of the committee as well as that of the IG have security clearances akin to those of personnel employed by the agencies being overseen. That will require background checks and security vetting of staff. Members of the Committee would be required to sign secrecy oaths under penalty of law.
The transition from the current ineffectual oversight mechanisms to something more effective will take time and money. It will therefore be resisted not only by the agencies being overseen (who naturally will be discomfited by increased scrutiny from agencies unattached to the Prime Minister). It will also be opposed by political sectors focused on cost-cutting, quick results, or maintaining the current system because of the weight of institutional legacies and/or advantages it gives governments when it comes to the interpretation and implementation of intelligence priorities. But it is certainly worth doing.
The time is opportune for change. The sequels to the Dotcom case have exposed serious problems in the political management of intelligence issues as well as deficiencies in the conduct of intelligence operations. The government has proposed significant changes to the 2003 GCSB Act, particularly section 14, that will have the effect of strengthening the GCSB’s powers of internal (domestic) surveillance at the behest of other agencies–foreign and domestic. The justification for this rests on the increasingly transnationalized nature of security threats, whereby the intersection of local and international crime, foreign corporate and political espionage, irregular warfare networks and non-state actors makes much more difficult precise definition of what constitutes a domestic as opposed to foreign intelligence concern. These are grey area phenomena, and the response cannot be given in black and white.
I agree that the security threat environment has changed and is much more “glocal” or “intermestic.” I agree that it requires statutory revision in order to better account for the changing nature of intelligence operations under such conditions. What I am proposing here is a parallel revamp of oversight mechanisms that promote more independence, transparency, accountability and compliance at a time when the scope of intelligence agency authority is being redefined and expanded well beyond traditional espionage operations.
The issue is worth debating and therefore should be the subject of a larger inquiry such as proposed by Labour and the Greens. If nothing else the Kitteridge and Neazor reports can be used as the starting point for a more thorough discussion of the role, functions and purview of NZ intelligence agencies given the changed nature of the threat environment and the equally compelling need to maintain a better measure of democratic accountability than has heretofore been seen.
I disagree with Pablo’s post about media treatment of the Aaron Gilmore saga — but I only disagree a little. In my view the Gilmore case is “stuff that really matters”, but I do agree with Pablo that most of the coverage of it isn’t getting to the “stuff that really matters” elements of the case nearly well enough, and that it is displacing coverage of more crucial issues from the agenda. All the stories Pablo mentions are worthy of much more, and more in-depth reporting than they have received. Two other points Pablo makes are particularly valuable — that “blood in the water is not akin to developing real critiques of the way power is exercised”, and that “the problem of Gilmore’s unwillingness to resign stems not from MMP but from political party charters regarding their lists in an MMP environment.”
The Gilmore story is important, as are those others — but the coverage is so individuated to him that it makes the issues seem trivial, because ultimately, if you reduce the story to that of a drunken backbencher, it is. At the heart of the Gilmore saga is the abuse of power, and the problem is that the coverage is about Aaron Gilmore’s attempted abuse of his own power, not about a culture within the National Party and the government where the abuse of power is not merely acceptable, but routine and expected.
The deep questions — how such a megalomaniac got into an electable position on a party list; who, having been apprised of these born-to-rule tendencies after previous incidents of this sort, approved his position; and the implications of this for the health of our democracy — these are important questions. They haven’t really been asked, or answered, though Matthew Hooton, of all people, had a go at it early on.
The John Key National-led government has a lot of form for bad and self-serving appointments, and for the abuse of power. This has presented opportunities for the opposition to frame them as serial cronyists, which they haven’t been able to take. (I wrote a couple of things about this in the first term — it’s not new). And it’s still going: to hear locals tell it, how Gerry Brownlee and CERA are treating Eastern Christchurch isn’t all that different in its principles to how Aaron Gilmore treats waiters and public servants. (The difference is that they have real power.) Recent appointments on the basis of loyalty or malleability at the expense of quality or expertise include Catherine Isaac to implement charter schools, Ian Fletcher as head of the GCSB and Dame Susan Devoy as race relations commissioner.
This is a government which has been particularly unconcerned with even the appearance of due process, and this should be acknowledged in every story on this topic. There’s no credible argument they hadn’t done due diligence on Aaron Gilmore — he was already in Parliament once. Why do they appoint people like this, and why do they get away with it?
The hard truth is that political parties will overlook an awful lot if there’s a financial or electoral advantage to doing so, just as corporations will. Militaries will overlook almost literally anything, up to and including the mass murder of civilians. This is true of the “nice” guys as well as the nasty ones — the Obama administration’s continuing support of Guantanamo Bay and its increasing use of UAVs are two clear examples of this. Apple products are manufactured by the notoriously exploitative Foxconn (Apple is far from alone in this, but we’re supposed to think Apple is somehow better than others). For a recent local example, see the Labour Party’s dogged defence of Taito Phillip Field, whose abuse of vulnerable workers cut directly against everything a Labour party ought to stand for. There are many more.
The fundamental reason this sort of behaviour is endemic is that we — as voters, or in the corporate case, as consumers — reward it with our votes, or our wallets, or both. Parties and companies that eschew these methods tend to lose to those who accept them as an ethical cost of doing business because while we are happy to get outraged, when the chips are really down, we don’t actually care that much about this sort of thing. It doesn’t really change our behaviour.
The danger is that people start caring, and more importantly, start remembering, and changing their behaviour. If the Aaron Gilmore affair haunts the National party — and the other parties — such that they see a strong downside risk to appointing cronies, selecting megalomaniacs for their lists, and generally swaggering around as if they own the place, we’ll all be better off. If parties are forced to accept responsibility for their bad decisions, and as a consequence to select better people and implement better systems of accountability and conduct, cultures of power-abuse will abate. Incidentally, this is why I don’t favour a rule that allows parties to eject rogue MPs from Parliament* — the Nats bought Aaron Gilmore, they own him. We should judge the entire party by his actions.
But for this sort of change to occur, we need media coverage to develop those real critiques of the exercise of power, rather than critiques of an obnoxious individual who is ultimately just a product of larger cultural systems. That would make this sort of wall-to-wall coverage worthwhile.
* Though I still believe any credible political leader should be resourceful enough to find ways to persuade rogue MPs to resign.
National has to be delighted about the coverage of their drunken bully boy last on the list MP, Aaron Gilmore. Coalition partner John Banks is in court on issues of political corruption. National is trying to ram through under urgency a gross expansion of domestic espionage courtesy of the amendments to the GCSB Act. What does the media focus on? Not-so-happy Gilmore. If I were the PM, I would milk the Gilmore story for all its worth, always looking chagrined.
There are very serious issues being discussed this week. US Attorney General Eric Holder is currently in the country. This is the person who authorized the FBI extradition pursuit of Kim Dotcom that resulted in the over the top raid on Dotcom’s home and subsequent legal debacle that is the case against him and which resulted in the Kitteridge report that recommended the organizational and legal changes now being proposed. As I allude to in the immediately previous post, the findings of a military inquiry about major failures in command and training in Afghan deployments have been released but not made public (huh?). The Green/Labour attempt to disrupt asset sales could be a watershed political moment.
Yet all of these take a back seat to the habitual escapades of a dolt working hard at being a lout.
Note to the media: although the salacious details of an inconsequential politician’s idiocy might seem worth mining, especially if it seems that he could wound the government, the real stories are dead and centre in front of you. Smelling shallow blood in the water is not akin to developing real critiques of the way power is exercised.
Note to the PM and the media that take his ignorance or obfuscation at face value: the problem of Gilmore’s unwillingness to resign stems not from MMP but from political party charters regarding their lists in an MMP environment. The two things are quite different.
Contrary to what the government would hope and TVNZ would like to believe, Seven Sharp is an idiot echo chamber, not a news aggregator, and therefore should not be used as a model for selecting which stories deserve emphasis.
Time to get off of the shellacked curly-cued imp and onto the issues that actually matter.
Last night the New Zealand parliament voted 77-44 on the third reading of the Marriage (Definition of Marriage) Amendment Bill, passing it into law. The strategy I wrote about after the first reading has been spectacularly successful, and marriage equality will be a reality as soon as the bill receives the royal assent.
There were many powerful speeches last night. Louisa Wall discussed the spectrum of cultural traditions around sexual and gender diversity, and called a huge roll of supporters from almost every corner of the political compass.
Maurice Williamson lampooned the supposed “gay onslaught”, celebrated the “big gay rainbow” that had appeared in his electorate this morning as a sign, and hilariously used his training in physics to calculate the amount of time a person of his mass and humidity would burn for in the fires of Hell. “I will last for just on 2.1 seconds — it’s hardly eternity, what do you think?”
Tau Henare gave his old party leader Winston Peters a lesson in political history, why referenda aren’t the answer to everything, and why exactly he is no longer a member of the New Zealand First party.
Mojo Mathers spoke of the pride she felt when her daughter attended the school formal with her girlfriend. And following the vote, in scenes that have been viewed all around the world, the House stood and broke into song.
There were others. But for me the heaviest work of the night was done by Kevin Hague, who got to the very heart of enmity to this bill, and to this cause in general. I’ve quoted him at length, emphasis mine:
Kevin Hague’s measured words and calm delivery obscure a stark and clear-sighted analysis: This is war. The enemy does not regard us as human, and they never will, so we must defeat them utterly. When it comes to GLBTI people, adherents to this creed of brimstone will be satisfied with nothing less than extermination and erasure: they are an existential threat. Although it is often couched in such terms, beneath the veneer theirs is not a rational objection founded in philosophy or pragmatism, in science or honest assessment of tradition; it is simply fear and hatred that burns like the fires they preach. This is not confined to the religious sphere — variants of the brimstone creed exist within secular society, and across a broad ideological spectrum, but they share extremism in common. Much of the discourse around marriage equality, and much of the discourse around related matters, rests on ignoring, minimising or mocking those who stand up for the brimstone creed, but the brilliance of Kevin’s analysis is that he meets them — and it — kanohi ki te kanohi, staring it in the face and recognising it for what it is.
But marriage equality won because it isn’t just an issue for GLBTI people. Ghettoising it as a “gay issue”, (as feminism for generations has been ghettoised as a “women’s issue” and racial equality has been ghettoised as a “black” or a “brown issue”) was a delaying strategy that worked for a time. But no longer. Marriage equality passed because a bill introduced by a gay Māori woman was supported not only by gay Māori women, but by men and women, young and old, homosexuals and heterosexuals and bisexuals, liberals and conservatives, socialists and libertarians, atheists and agnostics and Christians and Muslims, Māori, Pākehā, Pasifika, Chinese and Indians.
All of us who believe in a just society, and an equal society, who believe in a place where ancient prejudices, cultural inertia or the maintenance of privilege cannot justify erasure must fight these battles too. The brimstone creed isn’t just an existential threat to “teh gays” — it is an existential threat to a free and decent society, and we will not have won until we defeat them utterly. There are many more battles like this, and with the clear vision and fierce determination of people like Louisa Wall and Kevin Hague, I am strangely optimistic about fighting them.
Prime Minister John Key has released a statement expressing condolences at the death of Baroness Margaret Thatcher:
Labour leader David Shearer has also issued a statement:
(Both statements slightly edited.)
Justice Minister Judith Collins has appointed Dame Susan Devoy as Race Relations Commissioner.
She replaces Joris de Bres, who has served two five-year terms and is very well-regarded in Māoridom (at least) because (in part) he understands the importance of his own Dutch whakapapa, and the complexity of his place as an immigrant in Aotearoa. As Bryce Edwards and Morgan Godfery have noted, he has also shown an unusual willingness to comment on issues related to his mandate of opposing racism.
No doubt this fact has informed Collins’ decision to appoint someone less feisty. Dame Susan has little or no high-level experience in the field, and I suppose the thinking is that she brings a clean slate to the role or, to put it another way, her thinking and the degree of her engegement with the issues will be more easily influenced by the prevailing governmental culture. But Dame Susan is not a blank slate. A week ahead of Paul Holmes’ now-infamous Waitangi Day a complete waste column, she wrote one of her own that, although it employed language more befitting a Dame, nevertheless expressed similar sentiments. One year ago our new Race Relations Commissioner wished that instead of Waitangi Day we could have “a day that we don’t feel ashamed to be a New Zealander” and pined after a holiday like that celebrated in Australia, where — a few recent and grudging obeisances aside — 50,000 years of history and the brutal facts of the settlement of that land are blithely ignored in a jingoistic celebration of Ocker Pride.
That would be bad enough, but it gets worse: Dame Susan doesn’t have a clue what she’s doing:
This is a terrible appointment. Anyone who thinks Aotearoa’s race-relations culture isn’t complicated is by definition not equipped for the job of guiding and guarding it. Not only is our new Race Relations Commissioner ashamed of our national day, but as far as she’s concerned it’s just another ism — revealing how little she must know about disability, employment or gender issues into the bargain.
So as far as that goes, she looks like the perfect post-ideological, post-identity selection for such a job: a common-sense managerialist who, to the limited extent that she understands the issues in play, finds them distasteful.
What a good opportunity for Labour! The National government, at a time when racial and cultural tensions are a major issue, clearly doesn’t value race relations sufficiently to put anyone competent in the job. But the Labour party has selection problems of its own: an Ethnic Affairs spokesperson who is a former race relations commissioner (Rajen Prasad) so far down the list that he doesn’t get a ranking; and a Māori Affairs spokesperson — and former minister — Parekura Horomia, also unranked. Labour is perilously short on brown faces, with none in the top five and one — Shane Jones — in the top 10, and him only recently returned from purgatory.
The hard truth is that Labour isn’t in a position to criticise the government on race relations issues. This is due to their internal failures of strategy, not due to exigencies forced upon them. For all that the appointment of Dame Susan Devoy to Race Relations Commissioner is terrible, the Key government has done a lot more than expected in other areas of race relations, particularly with regard to progressing Treaty settlements. That gives them cover. They’ve gotten away with worse than this appointment, and they’ll keep getting away with it as long as the major party of opposition lets them.
Richard Prosser’s xenophobic and bigoted remarks about Muslims (which are not racist, since he was targeting a religion, not an ethnic or racial group) has rightfully met with wide-spread opprobrium. More than a comment about Muslims, his remarks say a lot about him on several levels. Let’s just leave it at this: That he was prompted to air his views by having his pocket knife confiscated at an airport security gate, then actually took the time to write out his thoughts in a magazine op-ed, make it clear that somewhere in Aotearoa a village is missing its idiot, and that idiot has been found spending lots of time in the Beehive.
However, the current repudiation of his views has not always been as wide-spread, and in fact his appeal to negative Muslim stereotypes was, if not all the rage, widely accepted just ten years ago.
Consider that when Ahmed Zaoui attempted to seek political refuge in New Zealand in late 2002, his arrival was met with official alarm and a chorus of exactly the sort of xenophobic invective that Prosser has voiced. The Fifth Labour government branded him an “Islamicst” with ties to al-Qaeda, then worked with the SIS to manufacture a “terrorist” case against him in order to justify his indefinite detention and eventual expulsion. It even changed domestic spying laws and created new anti-terrorist legislation (both still on the books and enhanced by National) so as to counter the Islamicist threat. The SIS went so far as to claim in its 2005 annual report that local jihadis and their sympathizers were a serious threat to New Zealand, only to drop the claim entirely in the 2006 report.
Zaoui was not the only Arab who got the heavy treatment. In 2006 Rayed Mohammed Abdullah Ali, a Yemeni-Saud flight school student overstayer, was summarily deported and handed over to Saudi security officials after he was caught (apparently following a tip-off to Winston Peters from a member of the public related to Ardmore Flying School). Despite concerns about his fate once he was turned over to the Saudis, he disappeared after being placed in their custody. The Fifth Labour government, through then-Immigration Minister David Cunliffe, refused to comment on his whereabouts or well-being and did not seek assurances from the Saudis regarding his treatment. As a justification for his summary deportation under escort, the Fifth Labour government claimed that he was a threat to national security, with his alleged “crime” being that he briefly flatted and shared pilot training with one of the 9/11 hijackers. No evidence has been produced to suggest that Abdullah Ali was aware of, much less involved in, the 9/11 conspiracy. Yet in the eyes of the New Zealand authorities at the time, relying in part on disputed FBI reports, he was guilty by association.
Shortly after Zaoui’s arrival Winston Peters, who now says that there is an element of truth to Prosser’s remarks but that his choice of words was unwise, demanded that Zaoui be expelled forthwith and went on to say that the NZ Muslim community was a “hydra” with extremist cells within it. Along with NZ First, National supported Labour on the Zaoui matter. Only the Greens questioned the official narrative (and Keith Locke needs to be congratulated for his staunch defense of Zaoui’s rights). Eventually, and with the help of some steadfast supporters and a few critical media types, the courageous work of Deborah Manning, Richard McLeod and Rodney Harrison destroyed the government attempt to frame and scapegoat Mr. Zaoui. After nearly five years the case against Zaoui was withdrawn and he was set free (he now runs a kebab place on K Road). For a good documentary overview of the case, see here.
My point is that timing is everything when politicians choose to stereotype so-called “out” groups. Back then Islamophobia ran rampant and it was fine if not fashionable to Muslim-bash, which the Clark government did adroitly and with aplomb. It did so by being subtle in its talk and thorough and focused in its actions. It publicly maintained it had nothing against Muslims or Islam, yet ordered its security apparatus to increase its surveillance of Muslim males (something that is ongoing) and enacted draconian security legislation with an eye towards the purported Islamicist threat to NZ (although truth be told, it first tried to use its new anti-terrorist legislation against the Urewera 18, and we know how that turned out).
Today all of that is water under the bridge although the laws remain on the books. NZ Muslims are no more of a threat today then they were a decade ago, but with the exception of the usual right-wing fanatics ranting in the blogosphere, the public mood is largely relaxed on the issue of the danger to NZ posed by Islamic extremism. Most politicians understand that even in election years scapegoating Muslims is now a losing campaign strategy. Thus Prosser is being made to wear a hair shirt over his contemporary remarks when he would have been applauded as a non-PC realist just a few years ago.
I would simply say that more than his stupid words, his timing if off. Politics is the art of hypocrisy disguised as righteousness, but the key to a successful disguise lies in the timing of the public posture. The Fifth Labour government timed its stereotyping just right, which allowed it to curry favor with its Western security partners in the anti-Islamic crusade by strengthening its anti-terrorism laws and internal security legislation. Zaoui was the precipitant and scapegoat used to that effect.
Prosser, on the other hand, is simply an uncouth political neophyte spouting rubbish at the wrong time. Had he made his remarks ten years ago he would have fared far better in the court of public and political opinion.
Posted on 09:50, October 10th, 2012 by Pablo
One thing has become clear after the revelations of multiple New Zealand intelligence agency failures, malfeasance and incompetence over the past few years. That is what happens when there is no effective oversight on, or accountability by those agencies. As things stand the Prime Minster is the sole oversight on New Zealand’s intelligence community. The parliamentary intelligence and security committee is a toothless wonder that gets semi-regular general briefings on intelligence matters (at a rate of less than once a month), and the inspector general (IG) of intelligence–the person who is supposed to independently investigate the actions of the intelligence community–is currently a geriatric former judge who has the equivalent of a .5 full time employee and whose office and resources are provided by the agencies he is supposed to independently assess. His predecessor, another retired judge, resigned under a cloud brought about by the Ahmed Zaoui political asylum case, where the Security Intelligence Services (SIS) was shown to have clearly manipulated analysis of intelligence flows derived from foreign partners and the IG demonstrated bias in favor of the SIS version of events prior to releasing his findings.
Add to that the fact that the IG has limited powers of investigation and a parliamentary committee that cannot be told about operational matters and has no powers to subpoena or authority to force testimony under oath, and what you have is a recipe for institutional “stretch:” the tendency of institutions to exceed and play loose with the rules, laws and regulations governing their charter in the absence of effective oversight and accountability. That has become glaring apparent in recent weeks.
The problem is somewhat mitigated when the Prime Minister is a hands-on type of manager who is knowledgeable about intelligence matters, to include methods of collection and analysis. Although it raises the possibility of PM misuse of intelligence flows for political purposes, it does have the merit of forcing intelligence officials to be accountable to someone. However, if the PM is disinterested, ignorant or laissez-faire in managerial approach to intelligence matters, then the possibility of intelligence agency institutional stretch becomes quite real, as we have now seen.
Given the revelations about the GCSB and prior instances of SIS “stretch,” the time is now perfect for a reform of the intelligence oversight apparatus. Although the PM can and should remain as the minister for intelligence and security, the parliamentary committee needs to be granted effective and binding oversight authority that includes powers to investigate operational issues and force intelligence agency officials of all ranks to respond under oath to questions about the how, when and why of specific intelligence matters. Likewise, the Inspector General’s position needs to be expanded into a three person panel that includes a mix of people with experience in handling sensitive information and knowledge of how intelligence collection and analysis works, and who answer to and are resourced by parliament rather than the PM and SIS, respectively.
Unchecked executive oversight of intelligence agencies is prone to what might be called the authoritarian tendency (by which elected executives assume quasi-dictatorial powers of managerial control), and is in fact the mark of many authoritarian regimes. This avoids the system of checks and balances that is not only a hallmark of democratic political systems, but of their institutional component as well. The issue, as the intelligence community well knows, is about triangulation: there needs to be at least three independent (if overlapped) sources of critical institutional scrutiny for information or oversight to be validated (which are manifest in policy or administrative decisions).
That system of institutional checks and balances is what provides oversight and promotes accountability within public bureaucracies as a whole. Such accountability is horizontal–between different public agencies such as the judiciary and security apparatus–as well as vertical (where public agencies answer to political authorities separated into legislative and executive components). The institutionalized oversight aggregate mitigates against public agency stretch and political manipulation.
Having one individual, whatever his or her persuasion with regard to issues of intelligence collection, analysis and political impact (something driven by the political context of the moment, including the relationship between government and opposition and the personal and partisan implications of any given decision regarding security and intelligence) is, in a democracy, antithetical. In mature democracies policy decisions are not individualized; they are institutionalized and subject to effective oversight.
This is simply a matter of democratic good practice. Effective, independent oversight not only keeps intelligence agencies honest and prevents institutional stretch. It reassure the voting public that the larger common interest, rather than narrow political, diplomatic or corporate concerns, are served by the intelligence and security agencies charged with defending the commonweal.
The outcome of the latest Greek election is not surprising. When faced with uncertainty and dire predictions of collective and individual doom in the event that radical change occurs, voters often tend to go with the status quo or what is already in place. Confronted with the “valley of transition” to an unknown future, voters rationally calculate that their interests are best served by staying with what is known rather than leap into the unknown. Add to that the orchestrated litany of woes predicted by bankers, capitalist-oriented politicians, and lender nations, who pretty much predicted the end of the world as we know it if Greece were to default on its debts and withdraw from the Eurozone currency market, and it is easy to see why a plurality of Greeks decided to stay with the hand that they have been dealt with.
The trouble is that hand, in the form of a New Democracy/PASOK coalition (the so-called “bailout coalition”) is exactly the hand that got Greece into the debt crisis in the first place. It was first New Democracy, then PASOK governments that set new records of corruption, clientalism, patronage and nepotism while running up the public debt on state-centered labor absorption and entitlement projects that did nothing for productivity or the revitalization of the Greek private sector (which remains fragmented and dominated by oligarchic interests in the few globally viable Greek industries such as shipping). It is to this pro-Euro political cabal that the responsibility for “rescuing” Greece is entrusted. That is not going to happen.
True, the terms of the bailout will be relaxed even further now that a pro-Euro government can be formed. That much is clear given that Andrea Merkel has hinted that the repayment terms can be “softened.” The hard truth is that repayment can be softened because what is being repaid in Greece is the compound interest on the foreign loans. The logic is that of the credit card: the issuer of the card would prefer for users to not pay off their total debt on a monthly basis and instead accumulate interest-accruing cumulative debt while paying off less than the total owed. If the user reachers a credit limit with interest debt accruing, the limit is raised. If the user defaults on the debt after a series of credit limit raises, measures are taken to seize assets of worth comparable to the outstanding amount.
States are different than individual credit card users because as sovereign entities they can avoid asset seizure on home soil even while bankrupt. As Argentina proved in 2000, they can default and renegotiate the terms of debt repayment according to local conditions (after Argentina defaulted on its foreign debts it was eventually able to negotiate a repayment to creditors of US 36 cents on every dollar owed. The creditors took the deal, then began lending again, albeit more cautiously. The devalued Argentine peso sparked an export boom of agricultural commodities that led to post-default growth rates unseen for 50 years). The short-term impact of default can be painful (witness the run on Greek banks as people try to cash in and export Euros), but measures can be taken to curtail capital flight and to mitigate the deleterious effects of moving to a devalued currency (the Argentines did this by placing stringent limits on currency transfers abroad in the first months after they de-coupled the Argentine peso from the US dollar while at the same time issuing interest-bearing government bonds to dollar holders in the amount valid at the exchange rate of the day before the de-coupling). Greece has not adopted any of these measures as of yet, but that is because a pro-Euro caretaker government, as well as the PASOK government that preceded it, wanted to heighten the sense of doom should an anti-Euro coalition look to be winning majority support.
That scenario emerged in the form of Syriza. Although it is formally known as the Coalition of the Radical Left it is anything but “radical” (no matter how many times the corporate media tries to emphasize that point). Instead, it is a coalition of Socialists, Social Democrats, Greens, Trotskyites, Maoists and independents not associated with the Greek Communist Party (KKE). It has an agenda that includes a possible default, and will now be the largest opposition bloc in the Greek parliament. Contrary to the perception that it came out of nowhere in this year’s elections, Syriza has been steadily building a popular voting base since 2004, increasing its electoral percentage significantly in 2007, 2009 and May 2012. Although it has had splits and defections (which are endemic in Greek politics, particularly on the Left), Syriza was the second largest vote-getter in the May 2012 elections and its margin of loss to New Democracy in the second-round elections held last weekend is less than it was in May. The bailout coalition may have a narrow majority, but Syriza and other Left minority parties will prove to be a formidable parliamentary obstacle to the implementation of its pro-Euro agenda.
That is why the new Greek “bailout” government will not be successful even if it renegotiates the terms of the bailout along more favorable lines than in previous iterations. It will be forced to deal with the combined pressures of Syriza opposition in parliament and the angry–and I reckon increasingly violent–opposition of the non-parliamentary Left in the street. Greece has a long tradition of student and union militancy and urban guerrilla warfare. Even during the best of times militant groups have used irregular violence to make their points about Greek capitalism and its ties to Western imperialism. They have burned and they have killed (including a CIA station chief, a British embassy official and various Greek security officers) during the decades after the Colonel’s dictatorship fell in 1973. These militant strands have not gone away and instead have been reinforced as the debt crisis drags on and the impact of austerity measures take their toll on the average (and increasingly unemployed) wage-earner. With unemployment at 20 percent and youth unemployment at 50 percent, the recruitment pool for Greek militants has grown exponentially.
Some of this has been siphoned off my neo-fascist parties like Golden Dawn. But the bulk of popular rage has been channeled by the Left, divided into the institutional vehicles of Syriza and the KKE (and various off-shoots), and the direct action, non-institutionalized vehicles comprised by the likes of Revolutionary Sect (who favor political assassinations) or Conspiracy of Fire Nuclei (who appropriately enough favor arson), that follow a long line of militant groups with a penchant for violence such as the N-17 and Revolutionary Struggle (and may in fact include former members of the latter), to say nothing of various anarchist cells.
These militant groups are not going stay quiet. Instead, I foresee a rising and relentless tide of irregular violence coupled with acts of passive resistance and civil disobedience so long as the political elite continues to play by the Euro rules of the game. Every Greek knows that the solution to the crisis is political rather than economic because the bankers have made more than enough profit on their loans and it is now time for them to draw down or write off the remaining interest owed. A softened bailout package only goes halfway towards easing the collective burden of debt, and the continued imposition of fiscal austerity deepens the stresses on Greek society (urban crime has ramped up significantly this year, and it already was pretty bad when I lived in Athens in 2010). Instead of continuing to cater to banks, the political decision palatable to most (non-elite) Greeks is not a softened bailout package, now into its fourth iteration. It is a complete re-structuring, with or without default, of the economic apparatus so that national rather than foreign interests prevail on matters of employment, income and production. This may require a retrenchment and drop in standards of living over the short-term, but it at least gives Greeks a voice in the economic decisions that heretofore and presently are made by Euro-focused elites more attuned to the preferences and interests of European finance capital than they are to those of their own people.
If there is a domino effect in other countries in the event that Greece eventually (I would say inevitably) defaults, then so be it simply because that is the risk that bankers and their host governments assumed when they lent to PASOK and New Democracy governments in the past. Perhaps it is time for bankers to pay the piper as well. After all, although their profit margins may fall as a result of the Greek default, they have already insured against the eventuality (the write-off of Greek debt by large financial institutions in the US, UK and Europe is the story that never gets mentioned by the corporate media). Moreover, and most importantly, the banks can accept the default and take their losses on projected interest as a means of keeping Greece in the Eurozone market, thereby avoiding the contagion effect so widely predicted at the moment. Default does not have to mean leaving the Euro currency market. Greece can default and stay in the Eurozone so long as the banks accept that it is in their long-term interest to shoulder the diminished profits (not real losses) that a default will bring.
Again, the economic decisions about Greece had already been made by the European banks, and they are now simply waiting, while claiming gloom and doom, for the political decision to terminate their interest-based revenue streams. The PASOK/New Democracy bailout coalition only delays that political inevitability, and Syriza and the militant Left will ensure that the next bailout is just another stopgap on the road to default and regeneration along more sustainable lines.
Whatever happens, it looks to be another long hot summer in the Peloponnese. Expect a lot of wildfires.
There is an old rule in politics that states that it is not the original sin that gets politicians in trouble. It is the cover-up or lying about it that does them in. The examples that prove the rule are too numerous to mention and span the globe. This week we have another classic case in point: Shane Jones and his explanation as to why, as Associate Minister of Immigration (the Minister of Immigration at the time, David Cunliffe, had earlier refused to revoke Liu/Yan’s residence visa and for some reason unknown to me was not involved in the granting of citizenship), he ignored expert legal advice and granted a Chinese fraudster expedited citizenship.
According to Jones he did so on humanitarian grounds because he was told by an unnamed Internal Affairs official that the applicant–he of at least three different names and an Interpol warrant out for his arrest–would be executed and his organs harvested if he were sent back to China. Forgive me if I cough. That is up there with Annette King’s claims that no one in the Labour government knew about Operation 8 until the weekend before it began.
Others have already torn Mr. Jone’s supposed rationale to shreds. Beyond the fact that not even the Chinese execute people for common fraud, even if they are members of Falun Gong (a claim supposedly made by but never proven by Mr. Liu/Yan), a legitimate fear of a politically-motivated death sentence would result in an asylum request, not a citizenship application based upon a business visa. Nor would Mr. Liu/Yan speak of traveling back to China with a delegation of Kiwis in order to explore business opportunities in the PRC (as it is claimed he did in his conversations with immigration officials now testifying at his trial on false declaration charges). But according to Shane Jones, not only was he facing certain death but also certain organ harvesting (which raises the question as to how the unnamed Internal Affairs official could know this in advance given that the Chinese do not harvest organs from all executed prisoners because the health of the condemned varies). Put bluntly, Mr. Jones is simply not credible, and unless that unnamed official comes forward to take responsibility for the bogus claims (which Mr. Jones could have ignored), his justification simply does not wash. Add in the fact that Mr. Liu/Yan had donated considerable sums of money to Labour coffers in the lead-in to his citizenship application, and the smell of something fishy permeates the affair.
What is amazing is that when confronted with the evidence presented in court, David Shearer continued to back Mr. Jones and even allowed him to go public with is ridiculous justification. That violates a second rule of politics, which is that when smoke begins to surround a politician on ethical issues his or her party needs to move swiftly to prevent a full-fledged fire from erupting by distancing the tainted one from the party as a whole. By not doing so immediately and only leaving open the possibility of standing Jones down if an investigation proves him guilty of wrong-doing in the Liu/Yan affair, Mr. Shearer has failed the basic test of leadership that involves saving the party from further uncomfortable scrutiny on the issue of campaign financing and political donations.
Once again, let us remember the iron law of oligarchy that governs all political parties: the first duty of the party is to preserve itself. Individual political fortunes come second. Legalities aside, it is the appearance of unethical behavior on the part of Mr. Jones that is at play here.
What is even more amazing is that this comes on the heels of the John Banks-Kin Dotcom scandal and John Key’s equally egregious mistake in not removing Banks from his ministerial post while the Police investigated whether Banks violated political finance laws in his dealing with Mr. Dotcom. Regardless of whether the press played this sequence of events on purpose, the scenario unfolded as follows: National was on the ropes in the weeks leading up to a dismal budget announcement, beleaguered by policy and personal conflicts and dogged by an increasingly assertive mainstream press. Rather than strike a contrast in approach that would give it the moral high ground that would allow it to score major political points against its weakened rival, Labour’s response to revelations of the dubious ethics of one of its senior members in a past government–dubious ethics that are being aired in court for crikey’s sake–is to bluster and blow more smoke on the matter. Do they never learn?
Just as Mr. Key should have removed Mr. Banks from his ministerial position as soon as his denials and lies about his relationship with Mr. Dotcom were exposed, so Mr. Shearer should have moved quickly to demote Mr. Jones until such a time as an independent investigation exonerated him. Given the passing of a few news cycles and the issue would have faded into the political “bygones be bygones” category. By not doing so Mr. Shearer has allowed the Jones-Liu/Yan relationship to become a distraction away from National’s peccadillos and policy failures. He has, in fact, thrown National a life line in the days before the budget announcement and the decision to demote Banks (who could stay in government but not be a minister pending the resolution of the Police investigation), and I would imagine that the National caucus are high-fiving and back-slapping each other in delight.
Of course there are political calculations in all of this. By-elections are costly, list candidate replacements are unproven or unreliable, internal Party factional disputes run the risk of being aggravated or exposed. National is clearly waiting for the Budget to be announced before moving on Banks. Labour does not want to lose a senior figure who “ticks the boxes” of important internal constituencies. And yes, there is a difference between illegal and unethical activity.
But in putting these calculations ahead of ethical considerations given the appearance of impropriety, both parties have once again shown their contempt for the NZ public. And on this score, Labour’s contempt is much worse. After all, Mr. Banks was just a greasy-palmed private citizen seeking to be mayor when he approached Mr. Dotcom for support. Mr. Jones, on the other hand, was a Minister of State who apparently used his office to bestow special considerations on an individual in exchange for, uh, party “favors.” Both actions were slimy, but it is the official nature of Mr. Jones’s intercession that makes his behavior worse. Which is why he should have been stood down straight away, because rightly or wrongly, it is the attempt to downplay or cover up past impropriety, rather than the potentially unethical or illegal behavior itself, that will cling to the Labour Party long after Mr. Liu/Yan’s case is adjudicated.