KEY POINTS:
In his younger days, long before the Premiership, Bob Carr used to have a witty stock response to telephone callers who interrupted internal conferences.
Picking up the phone, Carr would mockingly intone: "I deny everything and call for a Royal Commission". Carr always regarded the "call for a Royal Commission" line as the all-purpose political phrase, to be used by those obfuscating, or lost for anything better to say.
This line has been heard in abundance in Sydney recently from the Greens, who have been calling for a Royal Commission into political donations in NSW, despite the fact that the Independent Commission Against Corruption (ICAC) has the powers of a standing Royal Commission to investigate precisely such matters.
The Greens fastened on to the issue because they see political advantage. There is the opportunity to siphon votes away from Labor's left on the issue of political donations, especially from developers, to political parties generally, and to Labor in particular. The firm in which this writer is employed, Babcock and Brown, has been subject to criticism from the Greens.
Campaign contributions, at all levels of politics and to individual candidates as well as parties, often excite interest. The fact that Australian and state laws say they need to be declared simply enables the critics to draw alleged linkages even when none exist.
And of course, the example of the Wollongong City Council, recently the subject of an ICAC investigation, is clear in the minds of NSW voters. To recap, the council was caught up in an appalling scandal involving allegations of sex for favours, cash for preferential treatment and a greasy "table of power" outside a kebab shop, around which developers congregated. The State Government dismissed the council, appointing an administration panel.
So where is the debate going? Remarkably, both Federal and NSW governments appear to be heading in the direction of a total ban on political donations. What began as an argument about developers endeavouring to influence governmental decisions or being perceived as having too much influence in the planning, heritage and environmental processes has now crystallised into discussion of a future system in which the public purse would fund the parties' needs.
Such a development would be a first for global democratic politics.
This is remarkable for three reasons.
First, the Labor Party is in power everywhere and to concede this point is to surrender significant strategic advantage to Labor's conservative opponents. For the past several years, unlike much of the history of the Commonwealth, Labor has consistently out-fundraised and often outspent the Coalition.
Second, while the Wollongong saga is a political eyesore of the first order, there has been no broader demonstrable instance of any corrupt relationship between a political donor and a government decision. Allegations have flown thicker than arrows at the Battle of Hastings, but no one has made a case which involves Australian or state law having been broken. Still, the public mood appears to be for change.
And it must be acknowledged that many in the political class would welcome an end to the infinite cycle of fundraisers. NSW Planning Minister Frank Sartor, who has swatted away his critics consistently, would certainly be numbered among these MPs. Nor would business be unhappy with the proposed change.
Finally, as yet there has been no serious consideration given to experience in other countries, where limits, rather than bans, govern the process of political donations, and which might offer some instructive lessons.
Consider the United States and the prevalence of Section 527 Political Action Committees.
The last Federal election in Australia probably cost the parties and sympathetic groups in business and among unions the best part of A$100 million ($118 million). We're not talking lunch money here. But the Americans' spending on their current presidential cycle is setting new records. Significantly, the Democrats, both Hillary Clinton and Barack Obama, have been able to raise far greater sums than the Republican nominee John McCain.
And Obama is doing very well in the fundraising stakes by tapping into new constituencies via the net. Some of this was pioneered by Howard Dean four years ago. But Obama's inspirational campaign has drawn over a million comparatively smaller donors to endorse his campaign via the chequebook and through electronic funds transfer.
American politics changed with the passage of the McCain-Feingold Act of 2002, which restricted the parties' capacity to campaign using "soft money", originally raised for party-building purposes. These restrictions led to the creation of a new breed of Political Action Committees (PACs), codified under section 527 of the US Internal Revenue Law. Section 527 PACs range from George Soros to the Sierra Club, on to the notorious Swift Boat Veterans for Truth and through to the aggressive MoveOn.org. These PACs campaign vigorously beyond the umbrella of the parties and outside the reach of the US Federal Election Commission on fundraising and spending.
Australians saw this kind of spending by business and unions over WorkChoices at the last election. Unless federal and state laws are drafted comprehensively and in a complementary fashion, then avenues will be available in Australia for the equivalent of Section 527 PACs to blossom and be as active as they are in the US.
And while there is no First Amendment within a constitutional Bill of Rights in Australia to guarantee that PACs will be able to argue a point of view, the High Court has previously found that an implied right to free speech exists in the Australian Constitution. Ironically, this formed part of a decision which struck down an attempt by a Federal Labor Government to ban political advertising. Realistically, it will be a brave government of any persuasion which endeavours to preclude Australians from campaigning around either a principle or a particular issue.
But what if a ban is actually introduced? And upheld constitutionally by the court? Bans are fine in theory but human beings will always look for ways to circumvent them. And sections of the public are unlikely to warm to the idea of taxpayers providing tens of millions of dollars on election campaigns that were hitherto the responsibility of the parties themselves.
Nonetheless, the debate appears to be moving inexorably towards banning donations and curbing spending. If so, the parties will need to be far more creative with their money in future. And for those who have an agenda and dollars to match, creativity will begin by finding a new vehicle for campaigning.Stephen Loosley, a former federal president of the Labor Party and a senator, chairs the business advocacy group Committee for Sydney
Stephen Loosley, a former federal president of the Labor Party and a senator, chairs the business advocacy group Committee for Sydney
