Lead Editorial

4 December 2024
Vol. 26 No. 49

Amid the chaos of the final sitting day of Parliament last week, the Australian Citizens Party (ACP) won a massive victory over the fascist technocrats who wanted to repeal democratic accountability for the central bank. The final day for the Senate was a study in how democracy should not be conducted, with almost 40 bills rammed through requiring 120 formal division votes. Each division requires a minimum of one minute for the bells to summon Senators to the chamber, often four minutes, and then for the appointed tellers to count where the Senators sit on either side of the chamber. It means that Senators spent most of their day moving seats and not debating the bills they passed, allowing the government to pass farreaching laws with little to no scrutiny. Amidst all that chaos the government decided it also wanted to pass one bill that had received intense scrutiny, but to do so it had to surrender to the ACP, the Greens, Senator Gerard Rennick and the other politicians who had fought to save democratic authority over the RBA.

The RBA Reforms Bill 2023 had been sitting idle since the Liberals had declared they wouldn’t support Part 1 of the bill, which would have repealed Section 11 of the Reserve Bank Act 1959 which empowers the Treasurer to overrule the RBA board and governor. This was the power recommended by the 1937 Report of the Banking Royal Commission into the Commonwealth Bank’s inaction in the Great Depression; Labor’s greatest leaders John Curtin and Ben Chifley fought hard to establish this power in law. The Liberals’ shadow treasurer Angus Taylor initially had a deal with Treasurer Jim Chalmers to support the repeal of Section 11, but last year the ACP, working with the Greens, forced the bill to a Senate inquiry which the government opposed. (The blizzard of calls that forced that inquiry led one Senate staffer to comment: “There’s noone like the Citizens Party to melt the phones down!”) The inquiry heard from a succession of former RBA governors and former Treasurer Peter Costello, who all agreed that  the principle of democratic accountability is important and Section 11 should be retained. Their testimony persuaded the Liberals to drop their support, which destroyed Angus Taylor’s deal with Chalmers, and the furious Treasurer shelved the bill. But with the bill still sitting there the ACP was only prepared to claim a tentative victory.

Now the victory is complete, because to pass the overall bill, Chalmers had no choice but to negotiate with the Greens who, working with the ACP, had insisted that both Part 1 and Part 2 of the bill should be dropped. Part 2 would have repealed Section 36 of the Banking Act 1959, which empowers the RBA to direct the lending policy of the private banks. This power is very important, because it proves that RBA Governor Michele Bullock is lying when she repeatedly claims that “the RBA has only one tool” to control inflation, i.e. interest rates. No, it has another tool, Section 36, with which, for instance, it can order the banks to reduce lending to property investors to stop them from outbidding first home buyers and driving up house prices. The RBA could also order the banks to lend more to small business and industry, instead of 70 per cent of their lending for housing. To claim at least a token win for his RBA bill, Chalmers agreed with Greens Senator Nick McKim to drop Parts 1 and 2, the RBA Reforms Bill passed, and with that both the authority of Parliament over the RBA and the authority of the RBA over the private banks were saved!

This victory illustrates how the ACP has become profoundly effective in shaping policy debates in Australia, even from outside Parliament. With an election looming, the next step is to win an ACP presence inside Parliament.

In this week’s issue: 

• Matt Comyn’s CBA finds another way to rob its customers
• How can Mark Dreyfus have confidence in the US justice system when Joe Biden doesn’t? Free Dan Duggan now!
• The Electoral Reform Bill is stalled but the party is far from over
• Landbridge financially challenged but Darwin Port stands
• What future for the ‘never never’ fund?
• What’s happened to the Treasurer?
• Trump must save the economy to save the dollar
• House of Lords debates ‘troubling change’ to financial order
• Australian government’s Gaza hypocrisy betrays its Muslims Citizens
• Subservience to a foreign power damages Australia’s most important trade relationship
• Achieving government for the people
• China encircles the desert with ‘green wall’
• ALMANAC: China’s political outreach builds ‘bridges to the world’

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