TONY JONES: The Foreign Minister and Americaphile, Bob Carr, is just back from the US.
Earlier this evening he joined us here in the studio to speak about the presidential campaign and his own cameo role in the campaign courtesy of Mitt Romney.
We also spoke about Tony Abbott's controversial speech in China and about the relentless speculation on Julia Gillard's leadership.
Bob Carr, thanks for joining us.
BOB CARR: Pleasure.
TONY JONES: Has Mitt Romney verballed you over these private remarks about America being in decline?
BOB CARR: No, I was privileged to get a meeting with the Republican nominee and any Foreign minister would. It's a privilege to get in to see someone and leave some impressions about the country you're representing.
I said to him what I've said to other Americans and it's something Americans have enjoyed hearing, and that is that America is only one budget deal away from banishing talk of American decline.
TONY JONES: So you're saying he simply didn't understand the nuance of what you were saying?
BOB CARR: No, look, I enjoyed my conversation with him very much. And …
TONY JONES: But you're aware of how he's using your remarks now in a political context.
BOB CARR: I've been in campaigns myself; you've got to make every post a winner. My remarks I've made to Americans since I was in Washington on my first official visit in April and they're well received.
In fact the Americans like a friend to say to them, "You've still got the technological edge, you're capable of reviving your manufacturing competitiveness, you've – you've got – you're going to achieve energy independence.
"The one thing that keeps this motion of American decline on the agenda is the debt and deficit. And you need to get some reconciliation between the two political parties of the entitlement issues and the taxation issues to bring that debt and deficit in the medium term under control."
TONY JONES: You've made the point yourself that this idea that America's in decline has – is in the American debate – Republicans, Democrats and political commentators are talking about it all the time. Are you actually saying that if America doesn't resolve its massive debt crisis it will be in serious decline?
BOB CARR: Well Americans themselves have said that and I've got to take them at their word. General Mike Mullen, chief of the general staff – chairman of the joint chiefs said that the biggest threat to American security is debt, and that's a pretty serious thing for their military chief to say.
The president himself has spoken in his State of the Union address about the notion of American decline being out there. The Simpson-Bowles report seems to point the way forward, and I found when I was there again in April that people in Congress were talking about behind-the-scenes consultations from Republicans and Democrats towards a post-election budget deal.
And I mean, any friend of the America has got to hope that they can pull this off.
TONY JONES: Well you'd be aware how political it is, though. I mean, Barack Obama is being accused by Republicans of being the sticking point, the intransigent one, the one who's actually stopping any deal being passed because he insists on not cutting government programs and government spending, which is what the Republicans are trying to do.
That's where it's locked down, on the philosophical divide, very similar to the kind of divide we have here.
BOB CARR: Oh, the deadlock is very easily explained. The Democrats don't wish to cut entitlements in any way, their focus is on entitlements. The Republicans have got a focus on not seeing any movement on taxation, either an increase in the tax rate or the removal of some of the tax deductions that exist, that reside in the American system.
But I'm not getting into that sort of detail. I'm just saying as a friend of America's we wish them well in resolving this and draw their attention to the fact that they're achieving successes on other fronts like the movement towards energy independence or a revival of manufacturing competitiveness.
The major challenge for our friend is getting this budget situation under control.
TONY JONES: It must have been fascinating to meet Mitt Romney, the first Mormon ever to run for the presidency. What does history tell you though on the other side of his equation about whether the US electorate is prepared to put into the White House someone who's independently very rich and a businessman who's actually been in the business of sacking employees?
BOB CARR: Well that's going to be tested throughout the campaign, but again, that's not our interest, that's not our interest. We …
TONY JONES: I'm asking you as an historian of – and an intense observer of American politics.
BOB CARR: But as you're well aware, I can't step out of my current role. That's not possible. It's just important that Australia have lines of communication with both sides through our excellent ambassador, Kim Beazley. We do have that.
TONY JONES: John Howard never worried about this, I mean, he was quite happy to come on television shows and be disparaging about Barack Obama or very supportive of George W Bush.
BOB CARR: Well, well, to be fair to John Howard, and I want to be fair to him, on one occasion he did, he did – and I'm sure he'd agree with this interpretation – step over the line and say something very harsh about a candidate for the Democratic nomination who turned out to be the current president.
TONY JONES: And how do you think the election's going?
BOB CARR: Well, I mean, it's going to be as entertaining as any of them. For some of us – for a lot of Australians, watching the US presidential elections is the ultimate spectator sport. One Republican contact who I spoke to in April said this is going to be very tough, it's going to be house-to-house fighting. To him it was going to be something like the Battle of Stalingrad, it was going to be down to the last vote.
TONY JONES: And down to the last dollar, because it could be the most expensive election campaign ever waged in history.
BOB CARR: And fought over a very small number of voters, given that 44 of the 50 states are going, we know, to be Democratic or Republican. There's no contest in them. And in the remaining states, the voters who will determine the outcome are very small in number.
But it's a robust democracy that is always entertaining and sends a message to the world that – that there's nothing quite like the cleanout of the political system, the airing of differences that you get in this drawn-out American process of choosing a president.
TONY JONES: Just changing subjects now to Tony Abbott's comments on China. Do you have any indication at all that China is disturbed by Tony Abbott's remarks about investment in Australia by state-owned enterprises?
BOB CARR: No, the Chinese style would be take time to sort through this rather than to give an instant response. It just disturbs me that he is striking, in three or four of the things he said about China, what can only be seen and which will be seen by them, I think, as an adversarial approach with China, and I think that is reckless. I think it is really dangerously dumb for this country's interests.
TONY JONES: Where do you see the recklessness? Because I looked at his speech; it seemed very nuanced.
BOB CARR: Yes, well it was of great concern that he put the spin on his comments that was reflected in the interpretations that appeared in the media. I mean, to talk up differences with China, when, for example on investment – on investment as an example, you've got a constructive set of rules that the Chinese accept.
In 2008 this government separated investments by state-owned corporations and sovereign wealth funds from anywhere, not just China. It could be from the Gulf, it could be from Singapore, and said they're subjected, under the foreign investment review regime, to a set of more rigorous tests.
More questions will be asked about governance where it's a state-owned company or a sovereign wealth fund making an investment in Australia. Now those rules are in place and the Chinese by and large accept them and business understands them.
TONY JONES: Do you think Tony Abbott here was hinting at changing the rules, making them stiffer?
BOB CARR: He said that, he said that. He said he's moving towards a blanket prohibition on Chinese investment by state-owned companies. Now that is crazy.
You've got farm communities of Australia that are guaranteed prosperity because Chinese urbanisation is seeing people buy their foodstuff from supermarkets stocked with Australian produce. You've got 5,000 mining jobs in Australia directly dependent on Chinese investment.
You've got one iron ore project in Western Australia that is jointly owned by Australians and a Chinese entity that was set up by prime minister Bob Hawke and his Chinese counterpart 20 years ago. The Chinese will continue buying iron ore from us.
They get half their iron ore from Australia, encouraged by the fact that they, like the Japanese before them, are able to buy shares in those mines. This is a good thing for Australia.
TONY JONES: Well, I mean, it's clearly – well you can see today the state premiers and conservative state premiers are quite disturbed by this. They're all sort of emphasising that they want more Chinese investment. You think Tony Abbott will be forced to step back from this.
BOB CARR: Absolutely. You take what he said on China, this adversarial tone towards China, and you take what he said about Indonesia, sending the boats back, which would be guaranteed in his first week as prime minister, if he's elected, to produce a crisis in our relations with our nearest, most important neighbour, and you take what he said about the anglosphere.
Now taken together, taken together this would send a message to the world under an Abbott Government that somehow Australia was retreating to its old certainties of the 1950s. Talking about the anglosphere is sending a message that – forget Africa, forget the Caribbean, forget above all Asia; Australia's more comfortable with its old friends: New Zealand, Canada, the United States and the United Kingdom.
I mean, that's – there's nothing wrong with the excellent relations we've got with those countries. I value them. But for Tony Abbott to start talking that language, combined with what he's going to do on Indonesia and the adversarial approach towards China, sends a shocking message of retreat about Australia that we're now seeking security from Asia, that we're going back to a view so dated of Australia's role, it's more conservative than John Howard's.
TONY JONES: OK. Let me interrupt you there because there is another front that you've also accused Tony Abbott of saying that Australia intends to take sides against China over issues in the South China Sea. I saw no evidence of that in his speech. Where did he say?
BOB CARR: Yes, read it again, because my position, expressed now for about two months when the issue of the South China has come up, has been – in line by the way with the view of the Howard government – Australia doesn't take sides on the competing territorial claims.
TONY JONES: But where has Tony Abbott said he's taking sides?
BOB CARR: We'll come to that in a moment. Second, that we want this resolved in terms of the law of the sea and other relevant international statutes. And we've got to have a stake in it because 60 per cent of our merchandise trade goes through the seas.
He said in the interview he gave on top of his remarks that China's got to take responsibility for this dispute. The Chinese will interpret that as us taking sides against them.
TONY JONES: Because this is what he actually said in the speech: "Under a Coalition government Australia will do what it can to ensure territorial disputes in the South China Sea are managed peacefully and in accordance with international law." That sounds pretty similar to what you're saying.
BOB CARR: Yes, no, that's what we've said and that's what the Howard government has said. Look at John Garnaut's article in the Herald where pretty explicitly he's weighing in against the Chinese side. Now we've been painstaking, painstaking in saying we haven't got a dog in this race, that we're staying out of arbitrating on who's got the occupancy of this island, who's got the territorial claim to this stretch of water.
Now, it is very disturbing to the Chinese view of things were we to step down from that position, a position we've held under Howard and under this government and take a different approach. He's implied that he would.
TONY JONES: OK. While you've been away the leadership issue has bubbled up again in Australian domestic politics.
BOB CARR: This is a staple – this is a staple of Australian journalism! If there were …
TONY JONES: It's not a staple of Australian journalism per se, but it's a staple of Labor politics.
BOB CARR: Tony, I would want to see a regulation passed that applies to the press gallery without restraining for a moment the sacred freedom of expression that so ennobles our democracy that prevents, at least for an interim period of six months, any discussion of leadership challenges on either side of politics, any discussion of opinion polls and any discussion of early election speculation.
TONY JONES: Well you're going to have to deal with your own colleagues in order to solve that problem because …
BOB CARR: But then actually talk about policies.
TONY JONES: Well we've been talking about policies. This is what Paul Kelly said today. He's the most senior and experienced political commentator in the country according to many. In The Australian he says he's come to the conclusion with a primary vote of 28 per cent Labor must choose between oblivion and making Kevin Rudd a viable project.
BOB CARR: Julia Gillard is the leader of the party. The speculation will go on because the Government faces challenges and it's a government in a minority position in the Parliament. But I believe Julia Gillard will lead the party to the next election and I believe that this political situation, formidable as it is, the polls intimidating as they are, will, and can be, turned around.
TONY JONES: As a long-serving state premier though, you saw what happened after you left – the revolving door premiers of NSW. What does that tell you about changing leaders because the polls are starting to look bad?
BOB CARR: I think it tells you that those leadership changes made under the pressure of adverse opinion polls are viewed pretty cynically by the electorate. But, I can tell you this …
TONY JONES: You mean including the leadership change from Kevin Rudd to Julia Gillard, because that was in relation to adverse opinion polls?
BOB CARR: Tony, I can tell you this after talking to a lot of observers of Australia from abroad, that a country with 5 per cent unemployment, the inflation outcome that we've got today, a low level of government debt, budgets in surplus – that is a dream.
I mean, Americans at this conference I've been at from business or politics just say to you, "Your country's doing very well."
TONY JONES: I'm just going to press you on this just one more time because, well, I mean, you say you're pretty much blaming the media here, but the truth is that this is being played out behind the scenes among your Labor colleagues and some of them are briefing the media, which is why the media gets so many stories on this, and some of them, like Joel Fitzgibbon, the chief party whip, last week actually coming out publicly and saying unless the polls improve – and they'd gotten worse – that Julia Gillard might be for the high jump.
BOB CARR: But you'll always get someone – in a group as big as the Coalition or the Labor Party in Federal Parliament, you will get someone who is agitating for a leadership change.
Every caucus – I mean, I was leader in a state Labor caucus for 17 years, I was leader for 17 years, premier for 10 – there will be people in a caucus by definition aggrieved or at odds, dissidents, and if Joel wants to cast himself in that role, that's fine. There's a place in Parliament for people who occupy that position.
But again, my assessment is that Julia Gillard, as leader of the party, will be there at the next election pitching a case that is based on a very sound economic performance and the danger to that and to so much else from that reckless streak that resides in the Opposition Leader.
TONY JONES: Let me ask you then if you're wrong and there is a change of leadership, Kevin Rudd comes back as prime minister, would you be happy to serve under him as foreign minister?
BOB CARR: I'm not going to speculate about that because that generates a headline and we get caught in this cycle again.
TONY JONES: Bob Carr, we thank you very much for coming in to join us tonight, jet lagged as no doubt you are. It's good to see you. Thank you very much.
BOB CARR: This has been an antidote to jet lag. It's better than melatonin.
TONY JONES: Thank you very much.
BOB CARR: Thank you.
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