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Sub-tropical Fascism (Part 5): Corruption and corporate rule

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In this penultimate part of his six part series on Australian fascism, Dr George Venturini looks at how cronyism, corruption and corporate rule flourish in Australia's "managed democracy".

[Read Part One]
[Read Part Two]
[Read Part Three]
[Read Part Four]


SUB-TROPICAL FASCISM ― THE AUSTRALIAN WAY


CRONYISM, CORRUPTION AND CORPORATE RULE


CRONYISM AND CORRUPTION have lived so long amongst humans that it is fair to say they preceded The Bible, where many precedents are recorded.

This is not to say that in Australia cronyism and corruption are all around. Transparency International  provides every year a ‘corruption perception  index’  of 183 countries and it is sad to see that, in the latest (2011), Australia figures eighth in a decreasing scale, after New Zealand, Denmark, Finland, Sweden, Singapore, Norway and The Netherlands.

Opportunities for cronyism and corruption in Australia are greater when the Coalition parties are in power — if for no other reason than, at the federal level, they have been in government for some 65 years since Federation.

Sometimes excessive publicity is given to episodes of squalor by the media, which are by and large in the hands of Grand Corruptors. Thus much evidence was given to the case of a couple of ‘lifters’ involved in an episode of bullying at a coastal night club   -   he a powerful state minister and she a federal representative. So, would ‘Labor’ people content themselves with something less than cronyism — nepotism, perhaps? Then there is the case of a state minister who made the beau jeste of resigning her position to tend to her son, soon thereafter to return to parliament as deputy premier, no less, and always with her shoulders well guarded by the husband, a powerful federal minister. But these are modest, if glaring examples of cronyism.

Of course, a populace so conditioned by intellectually corrupt media would be expected to wonder what qualifications ‘union hacks’ hold. No question is ever asked about corporate honchoes, perhaps because having money, or a flexible conscience – and preferably both – is regarded as a sufficient title. Nothing news about that: the Medici proceeded on the motto: “Money to get power, power to protect money”. Only, notice the final result!

The ‘Liberals’, in particular, have always had more opportunities, not only for the length of their holding power but also because they come from a social milieu which flourishes in ‘private enterprise’ and can afford to enlist the best-paid ‘turf-accountants’ to minimise their taxes, or retain the ablest – or if not, the best connected – lawyers, who in turn speak the language most welcome by a classist judicial system. And all that takes place under the patronage of the monarchy which, naturally, personifies cronyism and is the source of corruption — not exclusively of the financial kind.  ‘Labor’ – whatever that has come to mean nowadays – must content itself of the crumbs. Anyway, nobody could – without blushing – accuse ‘Labor’ of running a meritocracy.

Then there are cases rendered less obvious to the naked eye by the application of the Axminster System – which is the classical, subtropical corruption of the Westminster type, and good for a carpet – under which whereby matters ‘too delicate’ can be swept.

Example: early in 2009, the Victorian Transport Minister ‘locked away’ all the documents of the disputed construction of Melbourne’s AU$700 million Southern Cross Station.



Transparency and accountability were postponed — until 2058. The decision was hardly unusual. It has become standard practice for Australian governments – at all levels – to ‘spare’ the public the ‘boring’, detailed information which would allow any assessment to be made of large infrastructure contracts.

Nowhere is the trend more pronounced than with respect to so-called public-private partnerships — projects in which private parties take responsibility for financing, constructing and operating public-use infrastructure in exchange for the right to receive user fees and charges. And here, another value, so dear to the Westminster System, comes into play — ‘tradition’. It should be remembered that one of the very first public buildings in the colony of New South Wales, the Sydney Hospital, was erected by an extremely corrupt PPP.

While concession arrangements for toll roads and other infrastructure assets have existed since time immemorial, they were ‘rediscovered’ and renamed PPPs in the late 1980s and have since become a primary means of financing mega-projects, with applications ranging from tunnels and desalination plants to hospitals and prisons. The change in branding from concessions to PPPs is hardly innocent. A concession by a government to a private party of the right to undertake and charge for a monopoly asset has a clear negative connotation: taxpayers are giving up something which would otherwise rightly be theirs. Who, on the other hand, could object to a partnership, with all the sense of shared obligation that word implies? As with "nation building", here words are being used not to assist understanding but to mislead. For whether the contracts are indeed a partnership, and one which delivers net benefits to the community, is a question of fact, not of form. The crucial issues are whether the projects are worth doing and whether the concession contract provides the project outcomes at least cost to the community.

Regardless of the final result, and its real utility, everyone's a winner. The firms undertaking the projects cash the rents. Governments gain more ribbon-cutting opportunities, vocal support from PPP firms, lucrative jobs for their ‘mates’ and welcome donations to campaign coffers. Only taxpayers and users suffer, but then again, ignorance is bliss. Little wonder that PPPs have proved increasingly popular with incompetent state governments and are now being vigorously promoted by the Gillard Government. Full disclosure of all PPP contracts, and of the cost-benefit analyses underpinning PPP projects, is indispensable if these costs are to be averted. And no suggestion is proffered here of illegitimate personal gain by public persons. It is just the ‘new way’ of doing things.

On the other hand, political corruption is the use of legislated powers by government officials for illegitimate private gain. Forms of corruption vary, but include bribery, extortion, cronyism  -   to some extent, nepotism, patronage, graft, and embezzlement. While corruption may facilitate criminal enterprise such as drug trafficking, money laundering, and human trafficking, it is not restricted to these activities.

In some cases, government officials have broad or poorly defined powers, which make it difficult to distinguish between legal and illegal actions. Worldwide, bribery alone is estimated to involve over US$1 trillion annually.



When a government confers a benefit onto some companies and not others, it is playing favourites. Sometimes it is called ‘picking winners’. Sometimes, it is called ‘targeted assistance’. The result is the same. But the opportunities for influence peddling and calling in favours take off when a government starts being selective. There is no problem with individuals or companies trying to influence government. This is what representative government is all about. Every voter who casts a ballot is trying to influence government —and sometimes a voter benefits, albeit indirectly, from particular policies. It is quite different when a broad policy applies equally to people of like circumstances — a tax cut for those on certain income or childcare assistance for those with children in like circumstances. But it becomes a problem when the practice is narrowed down to particular companies in particular industries; where special benefits go to people who seek special access to obtain them. Special influence looking for special benefits is a recipe for cronyism.

Outside of public funding, there are no guaranteed sources of financial support for political parties apart from the union movement's donations to Labor. Business support is contested. Some businesses support both sides of politics. Some support neither. Many skew their support to the party which happens to be in government — after all, the decisions that affect their business are made by the government not opposition.

The late Chalmers Johnson, reviewing a book by Emeritus Professor Sheldon Wolin – who for well over two generations taught the history of political philosophy from Plato to the present to Berkeley and Princeton graduate students – made some observations of a general character which, mutatis mutandis, apply to Australia, too.  'Our political system of checks and balances,' wrote Wolin, 'has been virtually destroyed by rampant cronyism and corruption in Washington, D.C., and by a two-term president who goes around crowing “I am the decider,” a concept fundamentally hostile to our Constitutional system. We have allowed our elections, the one nonnegotiable institution in a democracy, to be debased and hijacked  ... '

Wolin’s new book, Democracy incorporated: managed democracy and the specter of inverted totalitarianism, is a devastating critique of the contemporary government of the United States, including what has happened to it in recent years and what must be done if it is not to disappear into history along with its classic totalitarian predecessors — Fascist Italy, Nazi Germany, National-Catholic Spain and Soviet Russia. The hour is very late and the possibility that the American people might pay attention to what is wrong and take the difficult steps to avoid a national Götterdämmerung are remote, but Wolin’s is the best analysis of why even the presidential election of 2008 probably would have done nothing to mitigate America’s fate.

Wolin’s work is fully accessible and includes particular attention to the advanced levels of social democracy attained during the New Deal and the contemporary mythology that the United States, beginning during the Second World War, wields unprecedented world power.



Wolin introduces three new concepts to help analyse what Americans have lost as a nation. His master idea is “inverted totalitarianism,” which is reinforced by two subordinate notions which accompany and promote it: “managed democracy” and “Superpower” — the latter of which is always capitalised and used without a direct article. Until the reader becomes familiar with  this particular literary tic, the term Superpower can be confusing. The author uses it as if it were an independent agent, comparable to Superman or Spiderman, and one which is inherently incompatible with Constitutional government and democracy.

Wolin writes:
Our thesis … is this: it is possible for a form of totalitarianism, different from the classical one, to evolve from a putatively ‘strong democracy’ instead of a ‘failed’ one.

His understanding of democracy is classical, but also populist, anti-elitist and only slightly represented in the Constitution of the United States. 'Democracy,' he writes, 'is about the conditions that make it possible for ordinary people to better their lives by becoming political beings and by making power responsive to their hopes and needs.' It depends on the existence of a demos:
...a politically engaged and empowered citizenry, one that voted, deliberated, and occupied all branches of public office.

Wolin argues that
The American political system was not born a democracy, but born with a bias against democracy. It was constructed by those who were either skeptical about democracy or hostile to it. Democratic advance proved to be slow, uphill, forever incomplete. The republic existed for three-quarters of a century before formal slavery was ended; another hundred years before black Americans were assured of their voting rights. Only in the twentieth century were women guaranteed the vote and trade unions the right to bargain collectively. In none of these instances has victory been complete: women still lack full equality, racism persists, and the destruction of the remnants of trade unions remains a goal of corporate strategies. Far from being innate, democracy in America has gone against the grain, against the very forms by which the political and economic power of the country has been and continues to be ordered.

Wolin can easily control his enthusiasm for James Madison, the primary author of the Constitution, and he sees the New Deal as perhaps the only period of American history in which rule by a true demos prevailed.



To reduce a complex argument to its bare bones, since the Depression, the twin forces of managed democracy and Superpower have opened the way for something new under the sun: “inverted totalitarianism” — a form every bit as totalistic as the classical version, but one based on internalised co-optation, the appearance of freedom, political disengagement rather than mass mobilisation, and relying more on ‘private media’ than on public agencies to disseminate propaganda that reinforces the official version of events. It is inverted because it does not require the use of coercion, police power and a messianic ideology, as in the Nazi, Fascist and Stalinist versions. According to Wolin, inverted totalitarianism has
...emerged imperceptibly, unpremeditatedly, and in seemingly unbroken continuity with the nation’s political traditions.

The genius of American inverted totalitarian system, says Wolin:
...lies in wielding total power without appearing to, without establishing concentration camps, or enforcing ideological uniformity, or forcibly suppressing dissident elements so long as they remain ineffectual … A demotion in the status and stature of the ‘sovereign people’ to patient subjects is symptomatic of systemic change, from democracy as a method of ‘popularizing’ power to democracy as a brand name for a product marketable at home and marketable abroad. … The new system, inverted totalitarianism, is one that professes the opposite of what, in fact, it is … The United States has become the showcase of how democracy can be managed without appearing to be suppressed.

Among the factors which have promoted inverted totalitarianism are the practice and psychology of advertising and the rule of ‘market forces’, in many other contexts than markets; continuous technological advances which encourage elaborate fantasies, such as computer games, virtual avatars, space travel; the penetration of mass media communication and propaganda into every household in the country; and the total co-optation of the universities. Among the commonplace fables of the Australian, as well as of the American, society are hero worship and tales of individual prowess, eternal youthfulness, beauty through surgery, action measured in nanoseconds, and a dream-laden culture of ever-expanding control and possibility — the adepts of which are prone to fantasies, because the vast majority have imagination but little scientific knowledge. Masters of this world are masters of images and their manipulation. Wolin reminds the reader that the image of Hitler flying to Nuremberg in 1934 which opens Leni Riefenstahl’s classic film Triumph of the Will was repeated on 1 May 2003, with President George W. Bush’s apparent landing of a Navy warplane on the flight deck of the U.S.S. Abraham Lincoln to proclaim “Mission accomplished” in Iraq.



On inverted totalitarianism’s “self-pacifying” university campuses, compared with the usual intellectual turmoil surrounding independent centres of learning, Wolin writes:
Through a combination of governmental contracts, corporate and foundation funds, joint projects involving university and corporate researchers, and wealthy individual donors, universities (especially so-called research universities), intellectuals, scholars, and researchers have been seamlessly integrated into the system. No books burned, no refugee Einsteins. For the first time in the history of American higher education top professors are made wealthy by the system, commanding salaries and perks that a budding CEO might envy.

The main social sectors promoting and reinforcing this modern Shangri-La are corporate power, which is in charge of managed democracy, and the military-industrial complex, which is in charge of Superpower. The main objectives of managed democracy are to increase the profits of large corporations; dismantle the institutions of social democracy (social security, unions, welfare, public health services, public housing and so forth); and roll back the social and political ideals of the New Deal. Its primary tool is privatisation. Managed democracy aims at the “selective abdication of governmental responsibility for the well-being of the citizenry” under cover of improving “efficiency” and cost-cutting.

Wolin argues:
The privatization of public services and functions manifests the steady evolution of corporate power into a political form, into an integral, even dominant partner with the state. It marks the transformation of American politics and its political culture from a system in which democratic practices and values were, if not defining, at least major contributing elements, to one where the remaining democratic elements of the state and its populist programs are being systematically dismantled.

This campaign has largely succeeded:
Democracy represented a challenge to the status quo, today it has become adjusted to the status quo.

One other subordinate task of managed democracy is to keep the citizenry preoccupied with peripheral and/or private conditions of human life so that they fail to focus on the widespread corruption and betrayal of the public trust. In Wolin’s words:
The point about disputes on such topics as the value of sexual abstinence, the role of religious charities in state-funded activities, the question of gay marriage, and the like, is that they are not framed to be resolved. Their political function is to divide the citizenry while obscuring class differences and diverting the voters’ attention from the social and economic concerns of the general populace.



Another élite tactic of managed democracy is to bore the electorate to such an extent that it gradually fails to pay any attention to politics. Wolin perceives:
One method of assuring control is to make electioneering continuous, year-round, saturated with party propaganda, punctuated with the wisdom of kept pundits, bringing a result boring rather than energizing, the kind of civic lassitude on which managed democracy thrives.

Adds Wolin:
Every apathetic citizen is a silent enlistee in the cause of inverted totalitarianism.

And he wondered whether an Obama candidacy could reawaken these apathetic voters, although he suspected that a barrage of corporate media character assassination would end this possibility.

Managed democracy is a powerful solvent for any vestiges of democracy left in the American political system, but its powers are weak in comparison with those of Superpower. Superpower is the sponsor, defender and manager of American imperialism and militarism — aspects of American government which have always been dominated by élites, enveloped in executive-branch secrecy, and allegedly beyond the ken of ordinary citizens to understand or oversee. Superpower is preoccupied with weapons of mass destruction, clandestine manipulation of foreign policy (sometimes domestic policy, too), military operations, and the fantastic sums of money demanded from the public by the military-industrial complex.

Foreign military operations literally force democracy to change its nature.

According to Wolin:
In order to cope with the imperial contingencies of foreign war and occupation, democracy will alter its character, not only by assuming new behaviors abroad (e.g., ruthlessness, indifference to suffering, disregard of local norms, the inequalities in ruling a subject population) but also by operating on revised, power-expansive assumptions at home. It will, more often than not, try to manipulate the public rather than engage its members in deliberation. It will demand greater powers and broader discretion in their use (’state secrets’), a tighter control over society’s resources, more summary methods of justice, and less patience for legalities, opposition, and clamor for socioeconomic reforms.

Over the years, American political analysis has carefully tried to separate the military from imperialism — even though militarism is imperialism’s inescapable accompaniment. The military creates the empire in the first place and is indispensable to its defence, policing and expansion.

Wolin observes:
That the patriotic citizen unswervingly supports the military and its huge budgets means that conservatives have succeeded in persuading the public that the military is distinct from the government. Thus the most substantial element of state power is removed from public debate.



It has taken a long time, but under George W. Bush’s administration the United States finally achieved an official ideology of imperial expansion comparable to those of Nazi and Soviet totalitarianisms. In accordance with the National Security Strategy of the United States – allegedly drafted by Condoleezza Rice and proclaimed on 9 September 2002, the United States is now committed to what it calls “preemptive war”. Wolin explains:
Preemptive war entails the projection of power abroad, usually against a far weaker country, comparable say, to the Nazi invasion of Belgium and Holland in 1940. It declares that the United States is justified in striking at another country because of a perceived threat that U.S. power will be weakened, severely damaged, unless it reacts to eliminate the danger before it materializes. Preemptive war is Lebensraum [Hitler’s claim that his imperialism was justified by Germany’s need for “living room”] for the age of terrorism.

This was, of course, the official excuse for the American aggression against Iraq which began in 2003.

Many analysts would conclude that Wolin has made a close to airtight case that the American Republic’s days are numbered, but Wolin himself does not agree. Towards the end of his study, he produces a wish list of things which should be done to ward off the disaster of inverted totalitarianism:
...rolling back the empire, rolling back the practices of managed democracy; returning to the idea and practices of international cooperation rather than the dogmas of globalization and preemptive strikes; restoring and strengthening environmental protections; reinvigorating populist politics; undoing the damage to our system of individual rights; restoring the institutions of an independent judiciary, separation of powers, and checks and balances; reinstating the integrity of the independent regulatory agencies and of scientific advisory processes; reviving representative systems responsive to popular needs for health care, education, guaranteed pensions, and an honorable minimum wage; restoring governmental regulatory authority over the economy; and rolling back the distortions of a tax code that toadies to the wealthy and corporate power.

Unfortunately, this is more a guide to what has gone wrong than a statement of how to remedy it, particularly since Wolin believes that the American political system is
...shot through with corruption and awash in contributions primarily from wealthy and corporate donors.

Corruption as a way of operating has become so common – if not accepted – in Australia that it is possible to access a service on the subject from the internet. And from it the following juicy items were taken in one single day, at random, while researching this topic:
Australia Corruption News. Service for global professionals. Constantly updated news and information about Australia.

Latest Australia Corruption News

Migrants 'bribe way to residency' 21 Mar 2011 06:04 GMT
... University staff have been accused of taking bribes to falsify the English test results of ... gain a visa are currently applying for Australian citizenship, a Department of Immigration official has ... Department of Immigration official has told a corruption hearing. Western Australia's corruption watchdog is examining ...


Migrants bribe way to residency: hearing 21 Mar 2011 06:11 GMT
... Several migrants who allegedly bribed public servants to gain a visa are ... gain a visa are currently applying for Australian citizenship, a Department of Immigration official has ... Department of Immigration official has told a corruption hearing. Western Australia's corruption watchdog is examining ...


Unskilled workers bribe their way to visas 21 Mar 2011 08:26 GMT
... basis of false English-language credentials, a West Australian corruption hearing has heard. The state's Corruption and ... employee at Curtin University of Technology was bribed to falsify records to allow some visa ...


E-robbers the new security risk for Australian banks: SAS Institute 21 Mar 2011 02:50 GMT
... According to the SAS Institute's US based fraud strategist, Stu Bradley, who works with some Australian banks on fraud detection policies, local and ... see that as the next area the fraudsters will hit due to the sophistication of ...


Curtin Uni staff 'took visa bribes' 21 Mar 2011 05:26 GMT
... University staff have been accused of taking bribes to falsify the English test results of ... English test results of visa applicants, WA's corruption watchdog has heard. The Corruption and Crime ... are currently 34 IELTS test centres across Australia, with four in WA. Mr Quinlan said ...


Test scores 'faked after uni bribes' 21 Mar 2011 19:16 GMT
... students paid as much as $11,000 in bribes to have their English language test results ... to help them gain visa applications, a Corruption and Crime Commission hearing has been told. ... visas to work, study or live in Australia. A senior official for the Department of ...


Bribes allegedly paid to falsify visa tests 21 Mar 2011 04:42 GMT
... Bribes allegedly paid to falsify visa tests The ... English test score to be improved A Corruption and Crime Commission hearing in Western Australia has been told that a university staff ...


Ex-banker faces conspiracy, fraud charges 21 Mar 2011 05:36 GMT
... was involved in a multi-million dollar mortgage fraud, which police allege involved inflated property values ... Mohamad Diab, Mohamad Mehajer and a National Australia Bank staffer Mohamad Sowaid to “cheat and ... was approved by soliciting Mr Mehajer to bribe Mr Sowaid. It’s alleged Mr Sowaid was paid ...


Formula One cleared of $50m corruption payment 21 Mar 2011 19:51 GMT
... this year's F1 season which begins in Australia this weekend. The investigation surrounded a payment ... was arrested in January on suspicion of bribery, breach of trust and tax evasion. Last ...


Corruption Suspected In Lagging Tonga Economy 21 Mar 2011 09:41 GMT
... MELBOURNE, Australia (Radio Australia, March 17, 2011) - The ... weak economy. Another government minister claims widespread corruption and mismanagement is causing most state enterprises ...


Ex-banker on conspiracy, fraud charges 21 Mar 2011 12:02 GMT
... was involved in a multi-million dollar mortgage fraud, which police allege involved inflated property values ... Mohamad Diab, Mohamad Mehajer and a National Australia Bank staffer Mohamad Sowaid to “cheat and ...


Work visas issued on fake claims: hearing 21 Mar 2011 11:20 GMT
... basis of false English-language credentials, a West Australian corruption hearing has heard. The state's Corruption and ... employee at Curtin University of Technology was bribed to falsify records to allow some visa ...


WA uni staff faked test results, CCC hears 21 Mar 2011 04:01 GMT
... CURTIN University staff allegedly took bribes to falsify the English test results of ... English test results of visa applicants, West Australia's corruption watchdog has heard. The Corruption and Crime ...


English exams for migrants falsified 21 Mar 2011 15:46 GMT
... falsify English tests for potential migrants, a corruption watchdog has been told. Some of the ... whether visas should be revoked. Yesterday, West Australia's Corruption and Crime Commission began public hearings ... Centre were sufficient to detect the alleged fraud. ...


When 'Civil-Societyism' Fronts for Barbarism [opinion] 21 Mar 2011 14:01 GMT
... a fraud, rather than accomplice to moral corruption.' Many institutions are guilty of selling favours ... country's subsequent political rot, including a $3-million bribe to the Shaik family from German firm ... post via email and gapping it to Australia. The LSE's ethical collapse is special, not ...

Not a single word has been omitted, or added — for transparency as well as effect!

It was thought at mid-2009 that the reason why Australia had slipped down the international anti-corruption rankings was because of the A.W.B. Oil-for-Wheat scandal.



In addition, Transparency International lamented that many governments simply were not putting enough effort into curbing bribes. The organisation had just recently released an annual report which evaluated the efforts member countries were making to uphold the O.E.C.D.’s Anti-Bribery Convention. Australia did come out in the bottom category, criticised for carrying out little or no practical enforcement against bribery offenses by national businesses operating overseas. That was a category shared by 21 O.E.C.D. countries, as diverse as Turkey, Brazil and Canada. Only four countries are in the top tier, cited for active enforcement, with eleven in the middle with moderate enforcement. In such a climate, there was a risk that, unless enforcement both improved and became more uniform across countries, the Anti-Bribery Convention could become irrelevant. Conventions like this cannot afford to fail, otherwise it becomes one of those international conventions which are more valuable on paper than in practice.

Especially over the decades prior to the Convention, multinational corporations have helped bribery and corruption become a much worse problem — especially in developing countries.  As the multinational corporations, especially American and European, went abroad to countries which were vulnerable, the scale of the bribes increased as greedy officials would demand more from foreign investors.

This was particularly a problem in the resources sector, and distorted several national economies.

The Transparency International reports look at how many foreign investment corruption cases have gone to court, year by year, and how many had resulted in convictions. While not specifically including bribes, Australia’s biggest overseas corruption case for 2009 was the Iraq Oil-for-Wheat scandal and the Australian Wheat Board. Six cases were at the time in the civil courts, but none had yet resulted in convictions and the recommendations from the Royal Commission into the affair had not been followed up. The lack of results had placed Australia in the bottom group. Countries like the United States and Germany, which have both prosecuted several cases, served as a clear contrast in the top category.

Clearly the A.W.B. scandal would not go away, no matter what the Howard Government would do. It was the prevailing opinion that, apart from that scandal, the government itself was incompetent, dishonest and corrupt. It has been proven so in relation to its accountability and other processes following the discovery of restricted  and secret intelligence reports and communications between various Australian embassies, trade officials, the United Nations, Australian public servants and the Australian Prime Minister, the then Minister for Trade, who was also Deputy Prime Minister, and the Foreign Minister and their Departments in relation to the A.W.B. scandal.

New evidence and supporting material had come to light during an independent investigation into claims that Members of Parliament were holding ‘dirt files’. The ‘dirt files’ claims were proven, but in the process of the investigation, and a substantial amount of material related to the A.W.B. scandal as well as documents related to other issues were discovered. The A.W.B. material was held by various Australian agencies and had not been brought to the attention of the Royal Commission looking into the bribes provided to the former Iraqi regime through a straw company in Jordan.



The material showed that, in fact, senior Government Ministers were told on a number of occasions that the A.W.B. was providing bribes to Saddam Hussein and his regime, contrary to the provisions of the United Nations Oil-for-Food programme. Copies of confidential and secret diplomatic cables, memoranda, e-mails and other material were found showing that both the then Minister for Trade as well as the Foreign Minister, had received numerous detailed intelligence and other briefings very early on into the scandal.  They did nothing.  The Foreign Minister noted in one secret memorandum to the Australian Embassy in Jordan that: “No-one will ever find out anyway”.  The then Minister for Trade was also advised on a number of occasions as to what was going on. Prime Minister Howard was also briefed on the matter by the various agencies, including the Office of National Assessment – O.N.A., as well as the Australia’s international spy agency  – A.S.I.S.

The same Howard Government which had kept silent over what it knew of the Oil-for-Wheat scandal set out ‘to detect, investigate and prevent corrupt conduct’, through the newly formed Australian Commission for Law Enforcement Integrity  – A.C.L.E.I. – with an Office of the Integrity Commissioner.

The Commission was established by an Act of Parliament in 2006, and placed under the responsibility of the Home Affairs and Justice Minister. The agencies subject to the Integrity Commissioner's jurisdiction are the Australian Crime Commission, the Australian Federal Police, and the former National Crime Authority. From January 2011, the Australian Customs and Border Protection Service became also subject to the Integrity Commissioner’s independent scrutiny. Other agencies with a law enforcement function may also be added by regulation. A.C.L.E.I's primary role is to investigate law enforcement-related corruption issues, giving priority to serious and systemic corruption. The Integrity Commissioner must consider the nature and scope of corruption revealed by investigations, and report annually on any patterns and trends in corruption in Australian Government law enforcement and other Government agencies which have law enforcement functions. Accordingly, A.C.L.E.I collects intelligence about corruption in support of the Integrity Commissioner's functions.  A.C.L.E.I. also aims to understand corruption and prevent it. When, as a consequence of performing her/his functions, the Integrity Commissioner identifies laws of the Commonwealth or administrative practices of government agencies that might contribute to corrupt practices or prevent their early detection, s/he may make recommendations for these laws or practices to be changed. Any person, including members of the public and law enforcement officers, can give information to the Integrity Commissioner. Information can be given in confidence or provided anonymously.

Well Juvenal could ask: Quis custodiet ipsos custodies? — “Who will guard the guards themselves?”

After all, who would know about a little bit of corruption work, promoted by ‘benevolent’ organisations such as the one rendered public by the Victoria Ombudsman in March 2011.   And the innocent name ? — The Brotherhood.  The ‘brothers’ meet for lunch, to hear a guest speaker and then to engage in a bit of ‘networking’.

What the Ombudsman discovered about The Brotherhood confirmed the widely held conviction that its activities undermine the community’s confidence in public institutions.

Invitees from a list of up to 350 influential people have been attending the lunches every six weeks since the first one was held in 2003. The guests are all men, and the Chatham House Rules apply (i.e. “what is said in the room stays in the room”).

The host has been from the beginning the founder, a former policeman between 1988 and 1999, who had come to the attention of the Police Internal Investigations Department for, among other transgressions, assaulting a member of the public, and fined AU$200. He now heads two private companies. The founder starts the lunches with the statement “We are all members of The Brotherhood and we must assist each other.”



A whistleblower told the Ombudsman that the founder's
... motivation for the formation and maintenance of this group is to, amongst other things, provide an environment to facilitate unlawful information trading including confidential police information and other confidential information from government departments. This is in addition to gaining commercial benefits and inside information regarding contracts for tender.

On the invitation list are two ‘Liberal’ State MPs, many current and former police officers including one with alleged links to an organised crime figure. A former Australian Wheat Board executive involved in the Oil-for-wheat scandal is on it, too. So is the manager of a licensed table top dancing venue frequented by Victoria Police officers.

Some of the public servants attending maintain databases of sensitive information. It seems that a regular attendee, a senior Victorian Police officer, disclosed the identity of a prosecution witness in a high profile murder trial, contrary to a Supreme Court suppression order. One member used his position at the Traffic Camera Office to annul over AU$2,000 worth of speeding fines accumulated by the founder and persons of his companies. The ‘operator’ has denied any wrongdoing, but the case has been recommended to police for investigation.

The example of The Brotherhood is not unique. The Ombudsman’s report cited the New South Wales Independent Commission Against Corruption’s investigations into the ‘Information Exchange Club’ in 1992. This could be added to the mountain of damning reports and inquiries, including Royal Commissions into various state Police forces over the decades. Nothing ever seems to happen. ‘Revolving door’ appointments involving positions on boards for retiring, previously highly placed politicians have become routine.

The links between public institutions and big business interests – both mainstream and underworld – are becoming well known to the public, but one would be an optimist for thinking that anger at the seemingly endless stream of scandals is growing. It is pressure from the community which leads to the inquiries. It is in response to this same outrage that instrumentalities like the state-based Independent Commissions Against Corruption were established.

The demand on big business to abide by their State ‘rule of law’ is certainly justified; and the fight to bring business ‘operators’ to heel must continue. But so long as governments rule on behalf of corporations and the real power in society belongs to an oligarchy the battle will never be successful.

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