Australian journalist Antony Loewenstein has travelled to Papua New Guinea, Afghanistan, Haiti and around Australia to report on a growing trend of ‘vulture capitalism’ where the political and economic culture encourages ‘corporate vultures to swoop down upon the carcasses of weakened institutions and industries’. Vulture capitalism produces privatised and for-profit prisons, refugee detention centres, militaries and disaster reconstruction projects. The corporations that run these ventures lack transparency and accountability, and many people are unaware of the power they wield.
I was certainly unaware of the extent to which Australia’s refugee detention centres are privatised. It costs the government more money to keep an asylum seeker in detention than in the community, reports Loewenstein, and it is in the profit-making interest of the private companies running the centres to hold people for as long as possible. Loewenstein also exposes the power of the fossil fuel corporations and travels to James Price Point and PNG to examine the social and environmental consequences. He writes that ‘calling out the corporations that are causing global environmental damage is vital’.
Loewenstein builds on ideas from Naomi Klein’s book The Shock Doctrine, which documents what she terms ‘disaster capitalism’. Klein investigates the extent to which, after war or natural disaster has ravaged a nation, government deregulation and privatisation is imposed without democratic participation. Loewenstein sees a new brand of vulture capitalism, one that goes beyond the exploitation of disaster to infringe on more and more aspects of society.
But Loewenstein’s book is not all doom and gloom: he talks to people on the ground, each fighting against corporate power and predatory capitalism. His aim is to demand accountability and start a global debate. With a voice that is reasoned and intelligent, he warns of ‘a future that is being written without your consent’.
Kara Nicholson is currently completing a masters in environmental studies and spends her time reading novels to avoid doing any of the actual study part.
The Australian government’s decision to send all refugee boat arrivals to Papua New Guinea (PNG) is a political earthquake. It has nothing to do with alleviating the suffering of asylum seekers – if Canberra cared about it, a regional solution would allow processing of claims in Indonesia – and will further burden a poor neighbour. Some will be licking their lips at the prospect of massively enlarged detention centres; private companies will make a killing.
Veteran ABC journalist Sean Dorney rightly worries about social cohesion in PNG with the inevitable influx of thousands of people. Local communities there are already concerned that once again, they’re being forgotten. There’s no welfare system in the state, and its health and education infrastructures are crumbling. They’ll rightly wonder why these new arrivals will be treated better than the countless families in squatter settlements, including in the centre of the capital, Port Moresby.
I visited these areas myself in 2012 and spoke to locals who reminded me that Australian aid, over $500m annually, was having no positive impact on their lives. Prime minister Kevin Rudd’s latest announcement – to improve hospitals and universities in a touching bribe to PNG’s political elites – will be greeted with necessary skepticism by the many citizens who never see a decent hospital or school for their children.
The problem has never been that Australia gives too much aid; it’s that we’re throwing huge amounts of money to avoid a failed state on our doorstep by backing rapacious mining interests and overpaid consultants. After decades of Australian aid, PNG’s rates of infant mortality, sexual violence against women and corruption have never been worse.
None of this concerns both major sides of Australian politics. For more than a decade, they’ve outsourced the most unpleasant tasks of refugee processing to largely unaccountable private firms (British multinationals Serco and G4S being the most obvious), and Rudd’s latest moves will inevitably enrich even more of them. G4S, currently embroiled in a massive overcharging investigation case in Britain and facing a civil suit over claims three of its UK security officers assaulted a man while escorting him on a plane during a deportation, was granted an $80m contract by Australia to run the government’s facilities on PNG’s Manus Island. Recent revelations in the Guardian reveal that there has been no official oversight of processing times in the UN condemned facility.
This mirrors my own investigations, assisted by a senior Serco source, that confirms Canberra barely monitors the operation, because Australia so desperately needs the corporation to warehouse individuals and families.
This is the fate now facing PNG, with even more multinationals bidding for influence and profits in a nation whose last government was described by US officials in Wikileaks cables as a “totally dysfunctional blob”. G4S already have a large presence in PNG, I saw local staff guarding many buildings and energy installations last year, and Port Moresby has allowed the company to manage the soon-to-launch Exxon-Mobil LNG plant.
NGO Jubilee Australia released a 2012 report called Pipe Dreams (disclosure: I offered advice on certain sections and provided some photos) that questioned the Australian government’s financial and rhetoric backing of the $19bn LNG project. “There are serious risks that the revenues generated by the project will not mitigate the negative economic and social impacts of the project”, they argued. “In fact, it is very likely that the Project will exacerbate poverty, increase corruption and lead to more violence in the country.” Remember this is what Australia means when it boasts of assisting our northern neighbour.
History is repeating. I visited the province of Bougainville in 2012 to witness the aftermath of a civil war between a state and locals who opposed a polluting mine. At least 15,000 people were killed during the conflict in the 1980s and 1990s. Australia backed the PNG government to the hilt, and today there are moves to re-open the copper and gold mine without justice being served for crimes committed or a thorough environmental clean-up. This is how Australia supports PNG. A number of PNG citizens told me they wanted all Australian aid to stop immediately, because we’re forcing on them a development model that is only enriching political and industry elites.
Australia’s relationship with PNG since Canberra granted independence in 1975 has been based on paternalism. We have believed that throwing billions of dollars at our former subjects will bring prosperity and security. Former prime minister John Howard proudly wore the title (endorsed by former US President George W Bush) of Australia being “Washington’s deputy sheriff in the Asia-Pacific region”.
The population of PNG knows that we don’t treat them with respect and this latest move against asylum seekers will merely confirm that belief. Tragically, akin to Nauru having no economic alternative to accepting refugees from Australia, PNG is placed in exactly the same position by a regional bully that contributes to both these nations lying in ruin.
“Stopping the boats” and avoiding people dying at sea is a noble motive if its combined with solutions that place the rights of refugees first. Instead, we’re locked in a battle to punish a tiny fraction of the world’s asylum seekers.
The idea that refugees are an existential threat to Australia is laughable, but Labor’s so-called PNG solution completely accepts the narrative set by the Liberal Party since before 9/11. It remains almost verboten to argue for open borders in Western political discourse. An Indonesian people smuggler has already told ABC that the “PNG solution” may reduce the boats “for a while”. But at what cost? Using PNG as a dumping ground for an Australian political problem is guaranteed to breed resentment in a country most of our media studiously ignores.
Australia treats its neighbours with contempt. As soon as the latest contortions of refugee policy were announced last week, I tweeted that Australia could possibly expect international sanctions, not unlike against Israel due to its human rights abuses of Palestinians. If we flagrantly ignore international law and morality while locking up the most vulnerable people on the planet in privatised centres, we deserve nothing less.
A key issue in my forthcoming book, Profits of Doom, is the role of multinationals in turning huge profits from warehousing the most vulnerable people in our societies, including asylum seekers.
These revelations in Britain (via The Independent) are interesting but sadly history suggests that like vampires these corporations continue scoring contracts because neo-liberal politicians and officials simply can’t imagine a world where providing the best, as opposed to the supposedly “cheapest”, is the goal:
Whitehall contracts running into billions of pounds are being urgently reviewed after the Government disclosed that two major firms had charged the taxpayer to monitor non-existent electronic tags, some of which had been assigned to dead offenders.
In an announcement that throws the Coalition’s privatisation drive into disarray, the Serious Fraud Office was called in to investigate G4S, the world’s largest security company, over contracts dating back over a decade.
Serco, one of Britain’s largest companies, also faces an inquiry by auditors over its charges for operating tagging schemes.
The firms supply an array of services to the public sector from running courts, prisons and immigration removal centres to managing welfare-to-work schemes and the Atomic Weapons Establishment.
Between them the two companies receive around £1.5bn a year from the taxpayer, but their contracts are worth billions of pounds because the vast majority run for several years.
They were also hoping to cash in on moves by the Ministry of Justice (MoJ) to hand them further large contracts to operate prisons and supervise offenders in the community.
The process of awarding all contracts was put on hold last night as the inquiries got underway.
The MoJ began investigating all its agreements with the two firms, including the running of major prisons, while the Cabinet Office started scrutinising all other Government contracts with G4S and Serco.
Shares in both companies fell sharply after the announcement by Chris Grayling, the Justice Secretary.
Shares in G4S – which suffered torrid publicity over its mishandling of the last year’s London Olympics security contract – finished the day 12.6p down at 213p. Serco tumbled by 54p to 626.5p.
Each of the companies relies heavily on Britain both for income and burnishing its international reputation. The move by the Government is unlikely to result in the wholesale loss of contracts, as the firms have few competitors of the same size but is a blow to their standing worldwide.
The reality inside Australia’s countless, Serco run detention centres is far too often ignored by the media. There are notable exceptions, of course, and it’s a key theme in my upcoming book, Profits of Doom.
One of the strongest examples of independent journalism tackling the issue is the public release this week of Detention Logs, a project by three young journalists keen to bring far more transparency to what the general public knows and understands about the literally thousands of refugees trapped in immigration detention. Their key pieces this week are here, here, here, here and here.
It’s worth remembering that this project has been independently financed and initiated without the backing of the mainstream media (Detention Logs wants and needs your help). I know this because I’m friends with two of the journalists. That says something about the parlous state of investigative reporting in Australia.
My following piece is published today in the Guardian Australia:
The racism was raw. In 2011, John worked inside the Villawood detention centre in Sydney, and had little time for asylum seekers and their plight. He believed they had more rights than he and his co-workers had been given. John was employed by MSS Security, a private company contracted by British multinational Serco for menial work. He claimed that the lack of accountability for the behaviour of his employer proved the immigration detention system was broken. It was his opinion that the Australian army should manage detainees, because companies such as Serco “balk at a problem and remain eternally paranoid about losing the contract with the government”. The racism expressed by John is commonplace; I have met countless others on Christmas Island and at the Curtin detention centre holding similar views.
Nothing, it seems, has happened since that would change his view. Serco has over a billion dollars’ worth of contracts with Canberra to manage the never-ending stream of asylum boats. No other country in the world has outsourced these services to so few companies (you can count on on one hand the corporations receiving the vast bulk of the government’s money). In recent years, countless alleged cases of mismanagement and price-gouging have been documented within Serco and the Department of Immigration and Citizenship. These include Canberra’s failure to impose an independent auditing regime to monitor the multinational’s conduct in its many centres and the apparent failure to address potential remaining asbestos risks at Villawood.
Despite such problems, both the Labor and Liberal parties support the model currently in place for immigration detention, and few voices in the mainstream media challenge the underlying philosophy of having a for-profit company managing some of the most vulnerable people in society. The results are high rates of self-harm, mental health problems and attempted suicide (all documented last week in a damning report by the Commonwealth and immigration ombudsman), restricted media access and unnecessary commercial-in-confidence agreements between the government and corporations. There is an ethically blurry environment where the more refugees arrive on our shores, the more profits companies make.
The ongoing march for privatisation does not stop here. Rightwing thinktanks in Australia, such as the Centre for Independent Studies and the Institute of Public Affairs (a group that refuses to release a list of its financial donors), regularly call for the mass privatisation of state services. This includes the ABC, despite consistent public polling findinghuge support for the broadcaster.
Australia is the most tightly controlled media environment in the western world, with over 70% of print publication owned by US citizen Rupert Murdoch; in the words of John Pilger, “Australia is the world’s first murdochracy”. Indeed, charges against the ABC mirror the comments by James Murdoch about the BBC in 2009: “The expansion of state-sponsored journalism is a threat to the plurality and independence of news provision.”
Imagining a different Australia is possible, but the challenges are great.
The corporate media deliberately conflates “privatisation” with “reform”, and neoliberal ideology is accepted as fact. Even the Greens have embraced a market mechanism to reduce climate change, despite vast evidence questioning for-profit companies being the most appropriate way to do so. Canadian writer Naomi Klein is currently working on a book that will argue that capitalism is inherently incapable of reforming itself to tackle catastrophic changes to our climate.
In Australia, resistance to privatisation is reflected at the ballot box. The vast bulk of voters, according to polling, believe that corporations are the greatest beneficiaries from selling off public assets and overwhelmingly think that the state should own essential infrastructure. Voters also show their displeasure with the outsourcing agenda by often opposing parties that back it. Queensland is a key example, with current moves for mass outsourcing facing huge union opposition.
The left must now do a far better job in providing appealing alternatives. The facts are on its side. According to a recent report by the Australia Institute, electricity privatisation in Victoria has neither increased efficiency nor reduced prices. You won’t hear these uncomfortable truths from neoliberal propagandists. Despite the corporate press praising public-private partnerships, 2013 has seen the collapse of Australia’s biggest transport infrastructure project, Brisbane’s Airport Link tunnel, leaving more than $3bn of debt.
Civil disobedience, akin to protests in Western Australia against theoverwhelming influence of Serco, or detainees on Nauru hunger-strikingfor better care and processing, may be necessary. But more central is understanding how privatisation has become normalised in this country, despite it being opposed by societies across the world. Although states such as Argentina have seen first-hand the disastrous consequences of a rush to privatise water, Australians’ ability to resist similar plans requires a concerted effort from communities, media and politicians to explain the fallacies of accepted wisdom from market fundamentalists and free-marketeer historians who hold extreme views too often dressed up as rational and sensible.
The rot sits deep in Australia. The dumping of asylum seekers on Nauru and Manus Island is enriching countless organisations who know a desperate government when they smell it. Vulture capitalism thrives on poor Pacific islands because the Labor party wants to restrict the ability of the public to humanise the plight of those fleeing Afghanistan, Sri Lanka or Iran.
That companies are making a profit from this suffering shames us all.
In the town centre of Barrow-in-Furness in Cumbria, between McDonald’s and Carphone Warehouse, there is an unusual statue. Four firm-jawed figures in factory clothes stand back-to-back. One wears a flat cap, one wields a sledgehammer, one has a welder’s visor. All of them are in purposeful poses, idealised workers cast in bronze. Around the statue base run the words “labour”, “courage” and “progress”. Its structure feels like something from the Soviet Union in the 30s.
But the statue is British and only eight years old. Its subject and design, slightly startling in a country that stopped celebrating most factory workers decades ago, is explained by a small plaque. Part of the statue was “donated by BAE Systems Submarines”.
Barrow is a defence industry town. It builds Britain’s nuclear submarines. And in defence the way of doing things – culturally, economically, politically – is different from other British industries. In defence, manufacturing jobs still have prestige, long-term prospects and political leverage. Unions are strong, but work closely with management. Apprenticeships are sought-after and numerous. Political support for the business comes from across the ideological spectrum: when the European Fighter Aircraft collaboration between Britain, Germany, Spain and Italy, now known as theTyphoon, was threatened with cancellation in the 90s, even the Socialist Workers party protested (“No Closures. No job losses. Stuff the Tories.”) This week, David Cameron’s much-hyped trade visit to India is promoting the Typhoon as one of its key objectives.
Robin Cook, the late Labour minister, a rare defence industry critic in Westminster, wrote in his 2004 diaries that the then chairman of BAE, Dick Evans, seemed to have “the key to the garden door of No 10″. Roger Johnston, a defence analyst at Edison Investment Research, says: “As an industry, it is reasonably unique in how it’s viewed within government.”
In this business, in defiance of the past three decades’ free-market orthodoxies, the state is pivotal. Accompanying Cameron in India are representatives of a dozen British or partly British-based companies – the industry is clever at blurring such definitions – with defence interests: Rolls-Royce, Serco, BAE, EADS, Thales, Atkins, Cobham, JCB, Strongfield Technologies, MBDA, Ultra Electronics.
The British state is also the industry’s biggest customer, with our armed forces accounting for four-fifths of its annual sales; the provider of an “export support team”, including “serving British army personnel”; the provider of export insurance, for a fee, in case foreign customers fail to pay for products. Above all, the state is the provider of the wars that act as the industry’s best showcase.
“The Typhoon fighter jet performed outstandingly in Libya,” said Cameron in December, before an official visit to the Middle East. “So it’s no surprise that Oman want to add this aircraft to their fleet.” On landing in the wealthy Gulf state, he strode quickly from his prime ministerial plane, in front of the TV cameras, to where a pair of dart-like Typhoons had been specially parked in the perfect, sales-catalogue sunshine, barely a hundred yards away. He climbed a set of steps to the open cockpit of one of the fighters, and held a stagey conversation with its pilot. That day, it was confirmed that Oman had bought a dozen of the aircraft.
“Boosting exports is vital for economic growth, and that’s why I’m doing all I can to promote British business … so [it] can thrive in the global race,” said Cameron on the eve of his Oman trip. “Every country in the world has a right to self-defence, and I’m determined to put Britain’s first-class defence industry at the forefront of this market, supporting 300,000 jobs across the country.”
Despite leading an overcommitted, often embattled government, he has frequently found time for foreign visits with a defence exports element. He has been to India before, in July 2010; Egypt and Kuwait in February 2011; Saudi Arabia in January 2012; Indonesia, Japan, Burma, Malaysia and Singapore in April 2012; Brazil in September 2012; and Saudi Arabia, Dubai and Abu Dhabi in November 2012. Throughout, his salesmanship and justifying rhetoric have been strikingly unashamed.
“The PM has done a fantastic job,” says Howard Wheeldon, director of policy for ADS, a defence trade body. “He has picked up the value of defence to the national economy. Other PMs haven’t, necessarily. Mrs T was very supportive of defence exports … Brown wasn’t, but Blair was …”
(Via The Independent):
More than half of the Government’s contract spending on detention services went to just two firms, G4S and Serco, a report reveals today.
G4S was this month stripped of a key prison contract in the wake of its shambolic handling of Olympic security but the report reveals it won contracts for a third of spending on detention, surveillance, prisoner escort and deportation.
The report, by the Centre for Crime and Justice Studies, shows that out of £745m spent on contractors by the UK Border Agency and the National Offender Management Service between May 2010 and April 2011, G4S received £229m while £154m – one fifth – went to Serco.
Richard Garside, one of the report’s authors, said: “For… two very large companies [to] hold more than half the contracts doesn’t strike us as a particularly promising way of diversifying the market place.” He said it was against the public interest to have a near-monopoly on “very lucrative contracts which are shrouded in commercial confidentiality”.
Shadow Justice secretary Sadiq Khan said it emphasised the need for extending Freedom of Information so there was greater transparency.
Justice minister Jeremy Wright said new organisations were now competing in the market, adding: “Through competition we have secured significant cost reduction.”
G4S declined to comment but said the contracts were awarded only after a comprehensive and transparent procurement process.
Serco said: “All our contracts have been awarded following competitions designed to deliver value for the customer.”
Interesting development in Britain (via the Guardian) that shows deep concern with the companies both major sides of politics increasingly believe should run the country:
Home Office ministers have ordered weekly reports on the progress of two new contracts with the private security companies G4S and Serco to house and provide support services for thousands of asylum seekers and their families.
The chief executive of the UK Border Agency (UKBA), Rob Whiteman, has confirmed that serious concerns about the ability of the two companies to find housing for thousands of asylum seekers across the north of England by November has led to closer monitoring at the most senior levels of the Home Office.
The £883m a year Compass contract to provide support services for dispersed asylum seekers is the largest project run by the Home Office. The two private security companies took over the five-year asylum housing contracts in four of the six UKBA regions across Britain from social landlords, including councils, in March.
The companies were expected to start moving people in June. But after a contractual dispute G4S dropped its housing subcontractor for the Yorkshire and Humberside region, United Property Management, in June and its new subcontractors have yet to find enough homes.
Two councils, Sheffield and Kirklees, have raised concerns about their ability to deliver the housing contract within the expected timetable. Kirklees council said that a fortnight ago, only one family out of 240 asylum seekers had been moved as part of the transition from the council to the new providers.
“There are 240 asylum seekers being assisted. We understand the subcontractors are finding it difficult to procure accommodation and the council has been asked to continue to provide assistance until the end of October. There is no suggestion however that the council’s contract will be renewed after this time.”
Shameful (via Paige Taylor in The Australian):
It will cost about $29 million over the next 20 months for independent observers to watch over young, unaccompanied asylum-seekers in Australia’s immigration detention camps.
The figure is the nominal amount of a new contract between the Department of Immigration and Citizenship and the US-linked Maximus Solutions to provide “care and support” to teenage asylum-seekers who arrive by boat without a parent or a guardian.
There are currently 168 such teens, mostly boys, living under guard in “alternative places of detention” at Darwin airport, on Christmas Island and at a camp in the West Australian northern goldfields town of Leonora.
In the costly context of Australia’s immigration detention network, the department finds the $29m contract represents good value.
It is a tiny sliver of the size of the five-year contract between the Immigration Department and Serco for the management of Australia’s immigration detention centres on Christmas Island and the mainland; in July last year, that agreement, due to expire in 2014, was valued at $1,032,827,276.
The contract is one of the measures the federal government has in place to meet its obligations towards unaccompanied minors.
“As a signatory to the UN Convention on the Rights of the Child, the Australian government takes its obligations towards unaccompanied minors very seriously,” the Immigration Department states on its website.
Immigration Minister Chris Bowen is the legal guardian of all unaccompanied minors seeking asylum in Australia; as of last Friday, there were a total of 310 — almost half, 142, had been placed in community housing under the care of the Red Cross while the rest were still in detention. “The contract is for care and support services to unaccompanied minors in the detention network,” a spokesman for the department said yesterday.
“It is also for ‘independent observer’ services on Christmas Island and in mainland Australia.”
Since 2009, the contract has been held by Australian not-for-profit organisation Life Without Barriers.
A leading private health company, poised to win much of the new wave of NHSoutsourcing contracts, is under investigation for allegedly providing an “unsafe” out-of-hours GP service, and over claims that it manipulated results where it failed to meet targets.
Serco, which runs a large range of outsourced services for the government and local authorities, was subject to an unannounced inspection by NHS watchdogs in Cornwall last month in response to whistleblowers who claim that it:
• allowed queues of up to 90 patients at a time to build up at its telephone helpline;
• met its targets, in part, by adjusting figures to blame delays on patients;
• rang at least one patient who had waited too long to see a doctor to give them a new waiting target instead;
• repeatedly took visiting doctors off roving duties in order to operate clinics and hotlines because it had too few staff on duty to cover the county.
Many of the concerns appear to be supported by evidence gathered in a Guardian investigation that has drawn on data from computer records, drivers’ logs, internal correspondence and interviews with several sources connected with different parts of the Serco operation in Cornwall who have asked to remain anonymous.
Serco has also confirmed some of the allegations. But it denies that the service is unsafe and says it is acting within the terms of its contract with the local primary care trust, which allows it to adjust waiting time figures according to who was to blame and make “comfort calls” to patients who have waited a long time. It did not comment on the whistleblower reports of how many patients were left waiting to be assessed at its call centre.
Placing tortured asylum seekers into immigration detention in Britain – where private companies “take care” of aspects of this process – is shameful. Britain’s Channel 4 has the story:
Meanwhile, in Australia Serco is loving the increase in asylum boats. The more the merrier. Yesterday’s Australian records the screams of joy from the Serco board-room:
The private contracting company that runs Australia’s immigration detention centres has reported record profits, as the number of asylum-seekers rises to levels not seen in more than a decade.
New figures show Serco’s revenues reached $692 million last year, up from $369m in the previous calendar year.
While many companies in Australia are doing it tough, Serco reported a $59m profit after tax, close to a 50 per cent increase on its $40.5m profit in 2010.
Serco Australia is part of the global Serco Group, which is listed on the London Stock Exchange.
The company renegotiated its contract with the Department of Immigration late last year after an increase in the number of detention centres.
It signed a $370m five-year contract in June 2009 to manage seven immigration detention centres and provide transport services.
There are now more than 20 centres and Serco’s contract is worth $1 billion.
With reports yesterday that the number of asylum-seekers was returning to the levels last seen in 2001, Serco is likely to further profit from the surge in arrivals.
Rivalling the $1bn detention centre contract is Serco’s $1.3bn contract with the West Australian Department of Health to provide services to the Fiona Stanley Hospital in Perth.
The company employs 3564 people and as well as running immigration detention centres also provides “systems engineering work and related services” and “equity investment management”. It has $81m in cash and cash equivalents on its books, borrowings of just $7.6m and net assets of $157m.
Serco also has a five-year contract with the Queensland Department of Corrective Services managing the new South Queensland Correctional Centre in Gatton. Serco values that particular deal at $100m.
The company also has a $500m contract with the Royal Australian Navy.