18 December 2008
Interview with Ali Moore, ABC Melbourne 774
Main Topics: world trade talks, Carbon Pollution Reduction Scheme, first year of the Rudd Labor Government, Frank Crean.
ALI MOORE: I wonder if you remember a week or so ago, back to the APEC meeting in Peru - the global leaders wearing their brown ponchos? Well much more importantly, do you remember the commitment to free trade and to fight protectionism despite the global financial crisis?
Well Australia's Trade Minister, Simon Crean, has just returned from Washington, where a number of trade ministers have been meeting to try to kick-start global trade. Simon Crean joins me in the studio and it's also a good opportunity to ask about the first full year of the Rudd Government and he's also agreed to take your calls, if you'd like to give us a sense of how you rate the government in its first year. 1300 222 774 is the number.
Simon Crean, welcome to the program.
SIMON CREAN: Thanks very much Ali.
ALI MOORE: Let's start first of all actually not with trade but with Afghanistan. I woke up this morning to the news at four o'clock that, or 4.30, that the Prime Minister has made a surprise visit to Afghanistan. Did you know he was going?
SIMON CREAN: No. These trips have to be kept very much under security wraps.
ALI MOORE: But you're not a security risk. Did you not know?
SIMON CREAN: Well, let me say that I think it's important that the PM did make the visit. This is the time of the year that everyone gets together with families. Our troops can't do that. It's the time they think of families, time of Christmas, etcetera, etcetera.
So, I think it was a really generous commitment on the part of the PM to make the visit. Couldn't take them any beer, but he gave them a cricket set and, that's the other part of cricket for...
ALI MOORE: The other part of Christmas - the next best thing I suppose.
SIMON CREAN: That's right. Well, but, I think it's the demonstration that we here are thinking of them, and there's no higher authority that can send that message than the PM. So I think it was a great gesture.
ALI MOORE: That said of course, I mean, my first reaction was, gosh, he hasn't left the country again has he? Hasn't he had enough of that?
SIMON CREAN: Yeah, but look, you know, I find this strange. Here we talk about global conflicts, global crisis, global problems - whether they're climate change, trade talks, or whatever. You can't deal with them Ali unless you're prepared to engage. Engagement at the political level, engagement face-to-face. There's no other way to get these things done. You know, my background...
ALI MOORE: Well, well there are telephones and all that sort of thing. But you're saying you have to actually get there.
SIMON CREAN: Telephones and bilaterals - look, they, they can serve a purpose, but to close the deals it has to involve the face-to-face engagement. I do not believe the commitment from the G20 leaders would have been as strong as it was, had it not been for the physical meeting and the preparedness by a number of the leaders to try and push the parameters. That's why the ministerial meeting didn't happen in Geneva this week. It's very disappointing.
ALI MOORE: Well let's go back to that. You have just returned from Washington and the whole idea was to try and kick-start these global trade talks, which of course have been going since 2001. What was meant to happen, and why isn't it happening?
SIMON CREAN: What was meant to happen was because the G20 leaders had directed the ministers to meet and conclude what's referred to as modalities. That's what the purpose of the meeting was. There are a number of sticking points. We know that. They can only be resolved, in my view, if we get people around the table. That was a view shared by a number of others. It wasn't shared by everyone. And in the end, the judgement of the director general was that we didn't have what he referred to as sufficient convergence to justify the calling of the meeting yet.
ALI MOORE: Well the big problem is agriculture?
SIMON CREAN: There are two issues - one is agriculture and one is industrial products. But most of the hard issues have been resolved Ali. This is the, again, frustrating dimension of the trade talks. There are some difficult outstanding issues, but, we know that there are technical solutions to them. But technical solutions aren't enough unless there is the political will. And you'll only engage the political will when you do it collectively, when you do it round the table. Trying to resolve it through the telephone, one-on-one, bilateral discussions, that can get you to a point. But in terms of closing the deal, you physically need to be present.
Now, part of the other difficulty we ran into of course was the United States in transition. I would have thought that here was the time to show some bipartisanship, the existing administration and the incoming administration; that was not able to be achieved. That's a pity...
ALI MOORE: When you say it wasn't able to be achieved, is that because the current US Trade Representative - Susan Schwab - was not able to speak for the incoming administration? I mean, what was the...
SIMON CREAN: Well she can't really speak for the incoming administration. No one was denying that. And the incoming administration says that it can't, it's not there, so the current one has to act. So, it was a bit of this chicken and egg problem, which quite frankly could have been resolved had there been this bipartisan commitment to it.
We weren’t able to achieve that. And so therefore the challenge for us now is to accept the fact that it can't be done because of the transition factor in the US. What we've got to try and do is to make sure we can get it going as soon as the new administration comes in; as soon after 20th of January as is possible.
ALI MOORE: How confident are you though? I mean, you've been Trade Minister, but, you know as well as anyone - for as long as I have been a reporter I reckon I've been doing...
SIMON CREAN: Yeah.
ALI MOORE: ...you know, global trade talks without any success. I mean, are you close to sort of feeling like you've banged your head against a brick wall for so long it's time to give up, or is, are we any closer to really getting an agreement?
SIMON CREAN: I've been in lots of situations where you've had to keep banging your head up against a wall. But, if the cause is worth fighting and persisting with, that you've got to do. The world trade talks are that. Why is that the case? Because world trade grows faster than world output. Here we've got a global financial crisis. Every country in the world is saying, we've got to undertake fiscal stimulus packages to get the domestic economy going. What's the point getting the domestic economy going if you don't add the multiplier? What's the point in simply growing domestic output if you can add value to domestic output by freeing up trade flows?
Historically, world trade has grown three times faster than output and each new successful round extends that multiplier effect. That's why the trade negotiations are important. It's why the G20 leaders said they were important. And it's why we do have to close the deal. But it won't happen without the political will.
Your question - do I think it can be done - absolutely. I think that we are so close - yet in a sense, so far - but so close that we keep having to find ways to bridge that gap. And I'm prepared to do whatever it takes in terms of bridging that gap, including engaging, you know, one-on-one with others, trying to convince them that here's the opportunity to narrow the differences.
But, in the end, it'll happen if we get together. I sort of have that in my bones. The truth is, we, you talk about the seven years. The fact is, Labor's only been in for one of those seven years. The last trade round was closed by a Labor Government - the Uruguay round. And this year we've had more impact in advancing the round because we've been active at it. And every time the political will if you like has got round the table - whether it was in Davos in January, whether it was in Peru in April, whether it was in Paris at the OECD in May, the July ministerial - we always went forward. And that's why I think if we can get the meeting going, we will close the gap, in part, because we've got the global leadership saying, we must.
It's not just a question of trade ministers trying to find the solution. It's the knowledge that you've got the leadership of the G20, plus the leadership of APEC - 32 countries leaders saying, not just get it done, but we stand ready to help you get it done.
ALI MOORE: You're listening to the Federal Trade Minister, Simon Crean, on 774 ABC Melbourne. Wonder if you've got a question for the Minister. As, as you just said, it is of course the first, the end of the first full year of a Rudd Government.
Mary, in Croydon, good morning.
CALLER MARY: Good morning. I'd like to say that I am extremely proud of the Rudd Government and the work that they're doing overseas. And you go it Simon. Everything that you have said is absolutely true and you keep in there and you keep working for it; because it will happen. It's got to happen and I'm proud that you're out there for us. Thank you.
SIMON CREAN: Well thank you very much Mary. And I'm, I am out there for you. Always have been out there for you; and I'll keep doing it.
ALI MOORE: Michael, in Geelong. Good morning.
CALLER MICHAEL: Hello Ali and Simon. I'm a left-winger and I'm a supporter of yours. I quit the Labor Party when Beazley came round for the third time. Your reign has started well, with the apology, and the other things that you've done. But slowly but surely you're sliding backwards into the old habits of not performing. You're at the stage now where you're not doing anything for the environment. Peter Garrett - he went into the Parliament supposedly to represent us has been silent. He's been useless. All he's done is produce right-wing policies. It's ridiculous. And in the end of your reign of this first term, first year, is a total failure.
ALI MOORE: Michael...
CALLER MICHAEL: I'm sorry - total failure.
ALI MOORE: ...Michael, let Simon respond to that. Simon Crean - particularly on the environment.
SIMON CREAN: Environment - well let's, let's take this - first act of the government was to ratify the Kyoto Protocol, and that gave great hope in terms of a global solution to the problem. We then set about the task of the Green Paper and the White Paper - which has just been released. Of course what's happened in between is the global financial crisis. This has made all sorts of economies reassess. But importantly, they have not walked back from the commitment to try and find a global solution to climate change.
ALI MOORE: But do you think five per cent was too low? I've got a text message here just saying: Please tell Mr Crean how disappointed I am about the government emissions target and the whole attitude to climate change.
SIMON CREAN: I understand that people are disappointed that the five per cent isn't at the, isn't at a higher level that they would have expected. But five per cent is our unconditional commitment Ali. What we've said is we're prepared to go higher than that if there is a global solution.
The five per cent, by the way, when you translate it in per capita terms, is in advance of what Europe and the US have so far committed to. And that's including, under the Obama, what we understand to be the Obama Administration. So, I think people need to see the five per cent in two contexts. One, the per capita relationship, and it's much higher. But secondly, the fact that you - whilst we've got to lead, you can't be so far out in front with no one following that you expose your flanks. And the third...
ALI MOORE: But was there a problem with expectations though?
SIMON CREAN: No, the third, the third thing that I think is very very important, and this is important credit to Peter Garrett - we have also announced a commitment to introduce a renewable energy target. Now, that is important in encouraging the renewable energy. At the moment, there won't be investment in it because the market doesn't reflect it. You can get cheaper coal, you can get cheaper gas, you can get cheaper fuel. The only way you can start redressing that problem, plugging the market failure, is to put in the renewable energy scheme. That's what...
ALI MOORE: But is part of your problem...
SIMON CREAN: ...we have done...
ALI MOORE: ...with the five per cent, expectations? There were so, so much talk. I mean, I've never heard the per capita target before...
SIMON CREAN: Yes.
ALI MOORE: ...until it happened that you were announcing your White Paper a couple of days after Europe had committed to 20 per cent.
SIMON CREAN: Yes.
ALI MOORE: So clearly you needed to come up with something that was going to counter that. But, were the expectations set, and allowed to be set by your government at a much higher level than five per cent?
SIMON CREAN: No, I think that the expectations still remain high, but there was no expectation that Poznan - this conference that's just been held - was going to finalise it. The big challenge is where we go at the next meeting which is in Copenhagen.
Part of the reason for that is because there wasn't commitment from the US under the previous administration, and there was a realisation that time would have to be allowed for the new administration to come in and try and push it. In the meantime, we've got to engage the emerging economies - in particular China and India, Brazil. We need to engage them because they are big emitters. They have to be brought into the fold. We've accepted the fact that they will not have to, if you like, make the same effort as developed countries, but they have to make an effort. This is the concept of common, but differentiated.
So, there is still a very long way to go in the negotiations. What our White Paper has done is to stay, here is the range, five to 15, and we're prepared to go beyond the 15 as well if there is the global commitment...
ALI MOORE: And only after you've been to the electorate again? Could you make a decision to go above 15 without going back to the electorate?
SIMON CREAN: If in fact the commitment was there in Copenhagen next year, of course we would have to assess our position in the light of it. But in the meantime, what we're doing is sending out a very strong signal that we are prepared to make an unconditional commitment, but we will go bigger if the rest of the world also embraces it. I mean this is a global problem. It requires a global solution.
It's not just good enough for Australia, if you like, to be out there beating our chests saying, this is what we're going to do, if we're not actually influencing the outcome. And so the challenge - it's like any international negotiations; you certainly don't put your maximum on the table upfront before anyone else has done it. And I've been in a...
ALI MOORE: Well you'd know about that through...
SIMON CREAN: ...I've been in a few negotiations...
ALI MOORE: ...through the trade negotiations.
SIMON CREAN: ...negotiations in my day. But our commitment is there to do it.
ALI MOORE: At the end of a first year, I mean, can you give yourself a brief scorecard? I don't want to go through all the issues, but, I mean that perception that you've sort of fallen off. There's been other perceptions that there's been a lot of inquiries and a lot of studies. There's been the perception that Kevin Rudd wants to control everything, he's a control freak, he works people too hard. What's your assessment?
SIMON CREAN: Well I, look, Kevin is a great chair of the Cabinet, and I think it is a great clearing house for these issues. There's been a lot of work put into the climate change issue, for example - Cabinet committees after Cabinet committees, to try and get this balance right. He is a hard worker, but I wouldn't expect anything else. I'm a hard worker. I, you don't come into this, these sorts of jobs - especially when you've been out for 12 years - you don't come in to not work hard. I think the public expects you to work hard.
ALI MOORE: What about allowing a level of, allowing ministers and their departments to get on with things without everything having to go through a central channel?
SIMON CREAN: Well, I think it's got to go through a central channel. I think the collective decision making is the strength ultimately of a government. But, I've had enormous latitude in terms of my portfolio, and I know that's the case with other ministers. Kevin likes to be kept abreast. There are important opportunities to engage one-on-one. But fundamentally the decisions are taken within the Cabinet. I think the Cabinet is working extremely well. As for the year, I think we started very well. We started sure-footed, decisive, and then we were wrong-footed. We weren't the only country in the world that got wrong-footed. I mean the global financial crisis, when you think about the impact of that, and the way in which you have to adjust to the circumstances.
But look how quickly the government responded in terms of the liquidity issues besetting the banks, the fiscal stimulus package, additional packages that have come out. We'd just put our first budget down. Wayne Swan had just distributed the first budget. And the whole game changed.
ALI MOORE: Just...
SIMON CREAN: And without having a new budget, we've had to adjust the circumstances, not just from our own perspective, but in accordance with what global leaders have been calling for. And this is why the whole matrix does start to come together. You've got to have fiscal, but you've got to open up trade flows. If we can get that combination right, I think that we can not only bottom sooner, but come out of the bottom in terms of the economy recovery.
ALI MOORE: I want to ask you about your Dad - your father, Frank Crean, he passed away on 2 December; and, if you look at what's happening now, and you look at the times that he lived in, I mean he was, Federal Treasurer during the oil shock. What would he make of today? Because I know that in fact it was the other side of politics, it was Malcolm Turnbull who quoted your father in parliament, and he said - a quote of your father - I have 23 ministers who each reckoned he could spend as much as the total budget was. I reckon every Treasurer since then has probably said exactly the same thing. What would your dad make of where we are now?
SIMON CREAN: Well, he would obviously be delighted that he, were he to have the opportunity to respond to that challenge. I think, you know, this is, this is what you come to government for, to actually make the hard decisions and to set the nation up for a much more, not just a sustainable economic future, but a fairer one. That's the way I've always been brought up in politics, that there's got to be prosperity but it's got to have a purpose. It's got to be shared about.
In dealing with the challenge, I think the lesson we learnt from the Whitlam Government is that you couldn't have 23 ministers going off cutting deals amongst themselves. There has to be that central collective discipline.
And that was the hallmark of the Hawke-Keating Government. They said, we were not going to allow the process in which decisions that people didn't like, they could take back to Caucus meeting to be reviewed.
Now, the Westminster system requires discipline. The whole system of Cabinet solidarity is something that's really come to the fore in the modern era. It's something that dad would have wished for, but didn't have. And had he had it, not only could the warnings that he was talking about in terms of dealing with the oil shock, avoided the further inflationary pressures, but he, nor would he have allowed the Khemlani deals...
ALI MOORE: The great Loans Affair.
SIMON CREAN: ...the Loans Affair as well. But look, he was a, a great man. We were delighted, as best you can be in these circumstances, with the wonderful send-off that he had. There was a lot of goodwill, love, and affection for him. And I think that all the words that were spoken, people believed, because they knew him and they didn't see anything false or confected about them. He had a great life. He was a great father. And you saw that in terms of the tributes - great grandfather, and a great great grandfather. But they were a little bit too young to know him. But, lots of memories for us. And not only was he a wonderful father, but he was a great servant of the nation, and I think in many ways he's what most people would like all politicians to be like - he had that set of values of integrity and humility. He did have courage. He did take on the hard battles.
I reflect on the pre-selection - and many people have reflected on my pre-selection which was hard enough - but he had a horror pre-selection, because had to get 10,000 votes. Anyone who was a member of a union in those days, the union being affiliated to the party - you didn't have to be a member of the party - but they could get a vote. And he literally had to knock doors around Port Melbourne for 10,000 people, and he won. And against all the odds. This was at the time of the Split. So that was a really tough pre-selection. So, you know, that sort of courage, conviction, belief in yourself. They're the values that he taught us, and he taught many others Australians. And they're great values.
ALI MOORE: And he got tributes from both sides of the House. Simon Crean, thank you very much for being so generous with your time, and best wishes for a very Festive Season.
SIMON CREAN: Yeah. I'm looking forward to having it with the family. Unfortunately with, dad won't be there, but it won't be quite the same. But, everyone else will get together, so we'll have a nice one. And to you and all your listeners too Ali, have a great Christmas.
ALI MOORE: Thank you for joining us.
SIMON CREAN: Thank you.
ALI MOORE: Simon Crean there, the Federal Trade Minister.
[ENDS]
Media contact: Mr Crean’s Office - 02 6277 7420