Rising power of Australia's oligarchs

By Greg Ansley

Australia's Clive Palmer  has hit headlines with his plans to build a modernised replica of the Titanic. Illustration / Rod Emmerson
Australia's Clive Palmer has hit headlines with his plans to build a modernised replica of the Titanic. Illustration / Rod Emmerson

Billionaires wanting to protect their wealth are digging deep to push politics and public policy

A comedian was on the radio arguing that only bogans ever sound their horns in a traffic jam: "Anyone ever hear a Rolls-Royce's horn? Anyone know what it sounds like?"

Now, metaphorically at least, the Rollers are blaring in Australia. The nation's mega-rich are making their voices heard, digging deep to push politics and public policy their way in a style not seen for decades. They may still be an ultra-exclusive club, but there are now more Australian billionaires than ever before, and more of them ready to put their money where their mouths are.

The Labor Government is feeling the heat. Critics argue that the mining barons played a large role in seeing off one prime minister, nearly bringing another down, and helping to destabilise a Government whose tax and economic policies they abhor.

Treasurer Wayne Swan sees them as a threat, fuming in The Monthly: "To be blunt, the rising power of vested interests is undermining our equality and threatening our democracy ... We see this most obviously in the ferocious and highly misleading campaigns waged in recent years against resource taxation reforms and the pricing of carbon pollution."

Three in particular have been leading the charge, all laden with mining wealth: Australia's richest person, Gina Rinehart, Fortescue Metals founder Andrew "Twiggy" Forrest, and Clive Palmer, most recently noted for his intention to challenge Swan for his seat while building a modernised replica of the Titanic.

Others have been in the mix, although rarely pushing their heads so far above the horizon, more commonly using the less public and more traditional levers of power.

Not that this is new. With the exception of the middle years of the last century, wealth in Australia has been heavily concentrated in the nation's richest strata, and those with the most money have had a powerful voice in how the country is run.

Former principal Treasury adviser and Australian National University economist Andrew Leigh, now a federal Labor MP, told the Sydney Institute this week that in the first decades of the 20th century 12 per cent of the national income was held by 1 per cent of the population, and the richest 0.1 per cent owned 40 times their proportionate share.

Wealth was highly diluted from the 1950s to the 1980s, when the new breed of super-rich emerged, many happy to trade on their power: among them, the late media titan Kerry Packer, the late mining magnate Lang Hancock, Rupert Murdoch, and fallen shooting star Alan Bond. Since 1980, Leigh said, the wealthiest 1 per cent have enjoyed 13 per cent of the nation's household income gains.

The income share of those with incomes of more than A$200,000 ($256,170) has doubled, and trebled for the top 0.1 per cent with incomes above A$700,000.

"After being largely absent from Australian life for four decades, we saw the return of the magnate," Leigh said.

In a paper for Griffith University, researchers Dr Georgina Murray and Dr Jenny Chesters noted similar trends. Since 1988, the number of billionaires increased from one - Kerry Packer - in 1988 to 17 in 2005, and 29 in 2010. Murray and Chesters said the boom in barons had come with a swing in wealth away from agriculture and manufacturing to the media, property development, mining and construction. Leigh also identified the IT revolution.

They said the billionaires' clout was felt in their campaign against the mining tax, which eventually deposed former Prime Minister Kevin Rudd and helped persuade Australians that taxing the "super profits" of mining companies would cripple the economy, affect national wealth, increase unemployment and undermine the well-being of every man, woman and child.

"The infamous billionaires' protest against the mining tax would have been laughed out of town in the Australia I grew up in, and yet it received a wide and favourable reception two years ago," Swan wrote in The Monthly.

Even Swan concedes that the rich have every right to push their views and debate public policy - and they have, both in private and in public, and in fields ranging from tax policy to sport. Seven Network's Kerry Stokes has the ears of the powerful, retail giant Gerry Harvey lobbied hard for GST to be applied to overseas internet purchases, shopping centre king Frank Lowy runs Australian soccer and fought (unsuccessfully) for World Cup staging rights, and young newcomer Nathan Tinkler has been buying and selling football and league teams.

Then there are the real heavyweights, the billionaires Swan reviles as the "poison" of vested interests pocketing a disproportionate share of the nation's success and infecting politics and the economy. At the top is Rinehart, worth more than A$10 billion and possibly on her way to becoming the wealthiest person on the planet. She has been using her billions to cudgel the Government over the mining and carbon taxes, and has been openly courting an opposing, sympathetic, political elite.

She has also been extending her potential reach, buying 10 per cent of the Ten television network and a significant stake in the Fairfax media empire. With her is Forrest, balancing Christian beliefs and philanthropy with similar pro-mining, anti-Labor campaigning. He has launched a constitutional High Court challenge against the mining tax, backed by Western Australia's Liberal state government.

Forrest has also claimed Rudd was ousted in a deal between his usurper, Prime Minister Julia Gillard, and rival mining giants BHP Billiton and Rio Tinto. And he has moved into indigenous affairs, lobbying for new employment policies that would force a shift away from welfare to training tied directly to future jobs.

And there is the eccentric Palmer, a life member of the National Party, failed candidate for the Queensland Parliament and now aspiring Liberal pretender for Swan's seat. Palmer, who made his money in property development and more recently in mining, is an unrelenting foe. When his Gold Coast United team were axed from soccer's A-league, he unsuccessfully challenged it in court then set up his own governing body in opposition to Football Federation Australia.

He has flung, or threatened, lawsuits against corporations and governments, pondered media buys to widen his influence, railed against all things Labor and accused the CIA of conspiring with the Greens. Eccentricities, such as his plans for a Titanic rebuild, may add colour to the mix, but Palmer, Rinehart, Forrest and the less visible barons are wielding real power in an Australia still trying to find its way in the 21st century.

- NZ Herald

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