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Protection taunt riles Malcolm Turnbull's much needed Senate ally Nick Xenophon
Australian Financial Review Aug 20 2016 12:15 AM
Fleur Anderson
Nick Xenophon, Malcolm Turnbull's new best friend in the Senate, is a little concerned.
There's a sneaking suspicion the Prime Minister's speech on Wednesday about the perils of protectionism might have been a slight directed at him.
But then again, perhaps Malcolm Turnbull was just talking about Donald Trump and Pauline Hanson.
"The speech worries me," Xenophon says.
"I would have thought if the government wants to work with the crossbench, it would hold out an olive branch.
"Instead all the Prime Minister gave us was a few olive pips. And that's not enough sustenance to nourish the relationship."
Pauline Hanson might have four senators in her patch but it's still Nick Xenophon, with his three senators and one House of Representatives member, who is the dealmaker of choice to get the numbers for nine of the 11 crossbench votes needed to pass legislation opposed by Labor and the Greens.
Since the July 2 election, Turnbull has made every effort to be accessible to the crossbenchers, particularly Xenophon.
"If I need to speak to him, I'm able to see him in a very short space of time and he is always personable and approachable," Xenophon says.
All the talk by Turnbull and his Industry Minister Greg Hunt this week about the dangers of "raising the drawbridge" by turning our backs on free trade agreements to protect local industries is not something Xenophon wants to hear.
China might believe Australia is sliding into trade protectionism with its foreign investment rules – by stopping the Ausgrid purchase in the name of national interest – but the new populist parties believe Australia isn't going far enough to protect its own interests.
The Nick Xenophon Team wants tougher foreign investment rules, tighter anti-dumping laws stopping below-cost imports from flooding the market, government procurement to favour local businesses and manufacturers and above all, better scrutiny by the Productivity Commission of the touted benefits of free trade agreements.
The biggest bugbear is the decline of the Australian manufacturing industry, particularly the loss of 200,000 manufacturing jobs since 2008 and the looming death of the car industry in 2017.
"If the government wants to pursue its jobs and growth mantra it needs to acknowledge the urgency of the jobs crisis by 2017 when the car industry leaves Australia," he says.
"The way the government deals with Arrium and the loss of the car industry will determine my relationship with the government."
He believes free trade for free trade's sake and the blanket ban on taxpayer assistance to local manufacturer is "deeply superficial" and wants Australia to follow a similar path as the United States, Canada and Europe in considering deals that affect their local industries with an eye on the "national interest".
For inspiration for Australia's manufacturing future, Xenophon looks to Germany where manufacturing accounts for 22 per cent of the nation's GDP.
"In Australia, manufacturing accounts for 6 per cent of GDP," he says.
"I think we've lost the plot when it comes to manufacturing and advanced manufacturing."
On the other side, the government is likely to have a free-trade, pro-foreign-investment ally in Liberal Democrat senator David Leyonhjelm who suggests Xenophon change the name of his party to the Big Spending Protectionists Party.
He gives the government six months before it realises very little will get through the Senate via crossbench so it may as well give up and try to get Labor on board instead.
"Xenophon is seeking to create his own mythology by claiming to be a centrist," Leyonhjelm says, writing in the Australian Financial Review.
"But if you check the records, you'll find that he votes with the Greens two-thirds of the time."
Inaccurate and a "cheap shot", responds Xenophon, pointing out he voted with the Coalition on the carbon tax, border protection, the mining tax, direct action and the Australian Building and Construction Commission.
"I don't claim to have David's ideological purity but I hope he can make a constructive contribution," he says.
"I will be respectful of him even if it's not reciprocated."