Sunday 24 Feb 2019 | 08:17 | SYDNEY
Sunday 24 Feb 2019 | 08:17 | SYDNEY

Weekend catch-up: Indonesian election, Tunisian constitution, Obama in Asia and more



26 April 2014 08:00

Bringing together the best longer Interpreter articles you were too busy to read this week.

A short work week here in Australia, but still plenty of great stuff on The Interpreter. Robert E Kelly gave us this excellent primer on President Obama's trip to Asia. Here's how South Korea views the trip:

To read the South Korean media on the US alliance is to enter a world where the US 'needs' South Korea and the prestige captured from a direct relationship with the US is almost as important as the defence guarantee. Expect the South Korean press to push hard the notion that, because the US has parallel alliances with Japan and South Korea, South Korea is just as important to the US as Japan. The South Korean media will gush that South Korea is a 'bedrock' or 'cornerstone' of the US alliance in Asia. This in turn will be used to claim that Washington does not listen to Seoul enough but should; otherwise America's alliances in Asia might fall apart.

That none of that is true is irrelevant. Nationalist self promotion will be ubiquitous. Competition with Japan is so deeply entrenched in Korean foreign policy thinking that the US alliance and the president's trip will almost certainly be instrumentalised for the purpose of elevating Korea against Japan. As an example, look at what happened last timethe Korean media perceived the US to be tilting toward Japan over Korea.

On Easter Friday, Catriona Croft-Cusworth reported on the surprise success of Islamic parties in Indonesia's legislative elections:

The best-performing Islamic party, the Islamic National Awakening Party (PKB), secured broad appeal by recruiting 1970s pop singer Rhoma Irama, sometimes referred to as 'Indonesia's Elvis', as a presidential hopeful. It also had the support of Lion Air founder Rusdi Kirana, with whose help PKB launched a well-oiled campaign at the grassroots, something Joko Widodo's Indonesian Democratic Party of Struggle (PDI-P) is criticised as having failed to achieve ahead of the legislative election. Perhaps most importantly, PKB improved relations with Nahdlatul Ulama (NU), Indonesia's biggest Islamic organisation, since the last poll in 2009. The support of NU is important for PKB not only because of its significance in religious life but also for its role in the community as a provider of social welfare.

The National Mandate Party (PAN), which came in just below PKB, also has strong ties at the grassroots via Muhammadiyah, Indonesia's second biggest Islamic organisation. Like NU, Muhammadiyah is known as a provider of social welfare, particularly in health and education. And like PKB, PAN also invested heavily in campaigning to make its name known at the grassroots. It would appear that this combination of organisational links, provision of social welfare and investment in advertising paid off for both PAN and PKB.  Another common factor is that neither party holds an explicitly Islamist political ideology. Both are only Islamic in identity and via their connections to Islamic organisations.

Meanwhile, parties that do have an Islamist agenda, such as the PKS and the United Development Party (PPP), came in at the bottom of the scale, with the sharia-promoting Crescent Star Party (PBB) falling short of the parliamentary threshold. This would suggest that political Islam is still struggling to find support in Indonesia, though parties that are culturally Islamic can garner a broad support base, especially when they offer social services that benefit the community. A little star power and generous funding don't hurt either.

Catriona also wrote on new survey results suggesting that Indonesians are a happy lot:

According to survey results released by the country's Central Statistics Agency (BPS) last week, Indonesia scored 65.11 out of 100 on the agency's Happiness Index, placing it firmly in the category of 'happy' (50-75%) while falling short of 'very happy' (75-100%), but surpassing 'not so happy' (25-50%) and 'unhappy' (0-25%).

The national survey, conducted last year, aimed to measure general satisfaction with living conditions, security, environment, income, health, education and family harmony. It found that Indonesians were most positive about family relations and least positive about education and income levels, the Jakarta Post reported. The survey was the first of its kind to be conducted by the Indonesian Government.

Internationally, Indonesia also scored well on happiness in 2013 in a report compiled by market research company Ipsos. The country topped the table on happiness at 55%, leaving Australia behind at number 12 with a score of only 19%. Ipsos found that respondents were more likely to say they were happy if they also considered their national economy to be 'good'. Indonesia's economy grew by 5.6% last year but the wealth was unevenly spread, with 11.4% of the population living in poverty, according to World Bank data.

Indonesia's positive response to both the BPS and Ipsos surveys appears to confirm conventional wisdom that money can't buy happiness. Among BPS survey respondents, positive answers about time spent with family and neighbours outweighed concerns about access to clean drinking water and unstable housing materials.

Julian Snelder on why China's plans to add 'synthetic natural gas' to its energy mix represents bad economics, bad science and an environmental catastrophe: 

 The economics work today only because coal is cheap and gas prices are high; but it's highly vulnerable to longer-term price shifts. Also, SNG makers assume water is abundant and virtually free, at only 2% of total cost. That is a blatant mispricing. China is already in disagreements with its neighbours over its capture of water. In theory, some process water can be recycled, but coal is a notorious source of carcinogens known as BTX volatiles, which are expensive to remove.

The science is dubious too, because the SNG process converts a relatively high-quality energy source (coal) to a lower quality state (gas), and consumes a lot of energy in doing so. Thus the efficiency of conversion is low.

Finally, from an environmental perspective, the CO2 emissions from SNG production are much higher than conventional natural gas, and even worse than burning coal for power directly.

Julian also contributed a post on inequality in Hong Kong:

Hong Kong is famously unequal. The measured Gini coefficient is among the world's highest. It is praised for 'economic freedom' yet also criticised for 'crony capitalism.' 

It's well known in political science that, worldwide, folks care less about wealth inequality per se than lack of opportunity. People don't mind that the enterprising rich do well; what grates is that elite families should unfairly perpetuate their status (eg. by marrying other rich people, hyper-training their children, passing on large inheritances) and thus entrench social class.

Hence the anguish about inter-generational mobility: whether children of low-income families can rise up the socio-economic ladder. Harvard's Raj Chetty has now published a long awaited blockbuster study on the fortunes of American families — some 40 million individuals — since 1980. The survey was expected to confirm the worst: the end of the American dream. That same suspicion is shared by Hong Kongers. 

Speaking of inequality, Thomas Piketty's Capital in the Twenty-first Century is stirring debate. Lowy Institute Nonresident Fellow and former Reserve Bank board member Stephen Grenville gave us this superb review:

There was already wide agreement that income distribution has become much worse in most countries (both advanced and emerging) over the past three or four decades. In America, the top 1% of the income distribution pyramid has had a three-fold increase in income since 1979 while the average worker has had essentially no increase in real (inflation adjusted) income. Piketty's data tell the same story: the richest 1% own one-third of total wealth and get more than 20% of total income. And it's getting worse: they 'appropriated 60% of the increase in US national income between 1977 and 2007.' 

What has Piketty added to the debate? First, rather than focusing just on income, he tells a story about wealth (his book is titled Capital in the Twenty-first Century, with a knowing wink at Karl Marx). 

Second, he mines an often forgotten source of data: taxation records. This has the advantage of providing extended data series, giving his story broad historic sweep. The U-shaped arc of income distribution over the past century or so has gone from the grossly unequal distribution of the 19th century, through the shift towards greater equality in the 60 years to about 1975, followed by a reversion to inequality since then. He presents these data as readily comprehensible graphs focusing on what happened to the very rich over time, not the usual (and usually incomprehensible) Gini coefficients. 

Unrepeatable circumstances (two world wars, a depression, bouts of sudden inflation, nationalisations, the end of colonies) eroded established wealth for a good part of the 20th century. By 1975 the share of the top 1% had been halved. But after 30 atypical years of redistributive actions following World War II (progressive tax regimes; expanded social security), the political environment changed. The incentive-destroying side-effects of nanny state socialism, high marginal tax rates and government-owned enterprise became more apparent. Margaret Thatcher and Ronald Regan orchestrated the conservative revolution which enfeebled progressive taxation and set up the economy for the 'greed is good' era. Incomes returned to the skewed distribution of a century earlier. The Gilded Age returned.

Piketty enlivens his story by seeing this as a return to the world of Balzac and Jane Austen, where the principal objective of the wealthy was to entrench their position. If you weren't born to wealth, your effort should be directed at worming your way into the wealthy elite, probably through a good marriage. Hard work had little place in this effort.

The third enticing element of Piketty's story is the analytical apparatus (the 'model') he builds to explain this evolution. At the heart of the narrative is the idea that wealth is self-perpetuating. If the return on capital is greater than the growth of the economy, those who own the wealth will get a larger share of GDP over time (provided they don't spent too much on high living). This process has no self-limiting equilibrium. 

Syrian President Bashar al Assad has decided that, despite the ongoing civil war, presidential elections will be held in early June. Rodger Shanahan outlined the 'method in Assad's apparent madness':

An election that returns him to office will serve as yet another point of difference between him and the fractured opposition, and feed into the nationalist, anti-Islamic-extremist narrative he has been building all along. The narrative goes something like this:

  1. The election is a victory for the Syrian people (at least those who remain in Syria in areas under government control). By contrast, the political opposition either elect themselves or are appointed by their Gulf supporters. 
  2. The armed opposition is a combination of Western/Gulf lackeys and unreconstructed Islamist terrorists. The Syrian army's recent recapture of the ancient Christian town of Maaloula from Islamist fighters and Assad's subsequent Easter visit were designed to send a not so subtle message to religious minorities (and sections in the West) that the only person preventing an Islamist takeover of Syria is him.
  3. The Syrian people need a strong leader to counter external enemies, and Assad has stood firm these past three years in defending Syrian sovereignty against the aforementioned armed opposition and their allies. 

Of course, not many people in Syria really buy this narrative (with the exception perhaps of point 2), but that's not the point. This election is really about messaging and placing more pressure on the opposition in order to further fracture it.

'Almost a miracle': Leila Ben Mcharek on the new Tunisian constitution

This Arab Muslim country succeeded in getting its Islamists and secularists to agree on a constitution that recognises the Tunisian state as a civil state based on citizenship, popular will and the rule of law. It recognises the role of Islam but Sharia (Islamic law) is not mentioned as a source of law.

This is the most advanced compromise in the Arab and Muslim countries between Islamists and secular modernists. And this was the will of the people expressed through their representatives in the Constituent Assembly.

In reality, the constitution is a synthesis of the conflicting demands of politics and religion in Tunisia.

It is not only a genuine compromise between the Islamist Ennahda party (the leading party in the National Constituent Assembly) and the modernist secular forces in the Assembly, but also reflects negotiations between these two trends in Tunisian society as a whole. It was not easy to reach this consensus. Negotiations within the NCA lasted two years and three months and were echoed on the streets, with hundreds of thousands of Tunisians voicing their support for a civil state and for safeguarding and promoting women's rights. Other Tunisians, mainly Imams and religious associations who thought they had popular support, resisted articles of the constitution, such as the one on freedom of conscience.

Former NSW premier Neville Wran passed away on 20 April. Lowy Institute Executive Director Michael Fullilove wrote that Mr Wran's 'interests were always larger than state politics' and that 'he was convinced of the merits of Paul Keating's push into Asia':

This morning I spoke with Graham Freudenberg, Neville's speechwriter and the dean of Australian speechwriters. He told me that Wran was 'the best politician of my time in his ability to see the opportunities and pitfalls and to understand what the public would wear.'

Neville was immensely loyal to his friends, often to his cost. But Graham reminded me that he also 'enjoyed his hates'. One of these was the arch-conservative Country Party leader, Leon Punch. One day in parliament, when Punch was droning on, Wran turned to his deputy Jack Ferguson and said: 'If I go before you, and this bastard stands up in the valedictories, move the gag.'

I got to know Neville in my second year at Sydney University, when I joined the national committee of the Australian Republican Movement. The committee was chaired initially by Tom Keneally and later by Malcolm Turnbull. Apart from the UNSW student representative Lorand Bartels and me, the committee was comprised of the great and the good: Geraldine Doogue, Donald Horne, Harry Seidler, Faith Bandler, Colin Lanceley, Franca Arena and others. Neville dominated its meetings with intelligence and humour. He would usually arrive late, cut through the café talk, employ a few choice colloquialisms and bring us all to the point. He was pure crystal.

Finally, here's Luke Craven on the Pacific islands' youth bulge and the importance of labour mobility to the Pacific's future:

Temporary migration and labour mobility are regularly discussed at the Pacific Islands Forum and in bilateral discussions. While a number of schemes exist, the biggest are New Zealand's Recognised Seasonal Employer (RSE) scheme and the Australian Seasonal Worker Program (SWP). Now in its eighth year, the RSE is generally considered a success. Demand for workers far outstrips supply, with many calling on the New Zealand Government to increase the cap on worker numbers.

The situation in Australia is far less rosy. Only 710 visas were granted to Pacific seasonal workers for the first half of the 2013-14 financial year. On those numbers it is unlikely that the cap of 2500 visas per year will be reached. There is an almost uniform view that increasing the number of workers requires a 'demand-side fix'.

Expanding the SWP isn't an easy task. It requires broader structural reforms and a whole lot of political will. The broader point is this: given the importance of labour mobility for Pacific futures, and the integral role in poverty alleviation that migration can play, we need to elevate this discussion to a serious level.

Photo by Flickr user Ricky Romero.

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