Glowing routes connect cities across Asia and the Pacific in a dramatic orbital view of Earth.
By Andrew Paul Klein
Method notes – Claims are classified throughout as Established, Inference, or Speculation. The paper examines the institutional architecture of the Australia–US alliance, the gap between the language of the instruments and their operational reality, the absence of independent review, and the domestic political economy that sustains the arrangement. It does not argue that the alliance is illegitimate. It argues that the arrangement has never been subjected to the rational scrutiny that its scale and consequences demand.
Abstract
This paper examines the Australia–United States alliance as an accretion of instruments — ANZUS (1951), the Status of Forces Agreement (1963), the Defence Logistics Support Agreement (1989), the Defence Trade Cooperation Treaty (2007/2010), the Acquisition and Cross-Servicing Agreement (2010), the Force Posture Agreement (2014), and the AUKUS Naval Nuclear Propulsion Agreement (2025). It argues that the language of these instruments — “mutual consultation,” “sovereignty,” “shared values” — is formally equal but operationally asymmetrical. The architecture they create is a US force posture system that uses Australian territory, Australian funding, and Australian industrial capacity to sustain American global power projection. The paper documents the mechanisms of lock-in, the absence of independent review since the Whitlam era, the revolving door between politics and the defence industry, the domestic political function of alliance rhetoric, and the role of algorithmic governance in amplifying defence priorities over social needs. It concludes that the rational decision — an independent, public cost-benefit review of the alliance — has never been conducted, and that the rationalization of the arrangement continues instead.
1. Introduction: The Gap Between the Language and the Architecture
The Australia–US alliance is described in the language of partnership. The ANZUS Treaty commits the parties to “act to meet the common danger.” The Force Posture Agreement speaks of “mutual determination” and “Australia’s invitation.” AUKUS is described as an “enhanced security partnership.” The language is the language of equals.
The architecture is not. The Force Posture Agreement grants the US access to Agreed Facilities and Areas without rental or similar charges. The US has operational control over facilities it constructs. The AUKUS agreement creates a thirty-year dependency on the US and UK for nuclear propulsion technology, training, and maintenance. The Defence Trade Cooperation Treaty streamlines the flow of US defence articles into Australia. The intelligence-sharing arrangements fuse Australian intelligence with US systems.
None of these instruments names China. All of them are designed for a contingency in which China is the adversary. The lock-in is not in the language. It is in the capability.
2. The Instruments: An Accretion, Not a Design
The alliance is not a single treaty. It is a series of instruments signed over seven decades, each defensible on its own terms, none of which constitutes a coherent strategy.
2.1 The ANZUS Treaty (1951)
The ANZUS Treaty was signed in San Francisco on 1 September 1951 and came into force on 29 April 1952. Its operative provision, Article IV, states that each party “would act to meet the common danger in accordance with its constitutional processes”. The phrase “constitutional processes” is deliberately vague. It does not compel military intervention. It creates a binding obligation to respond, but the nature and extent of the response is left to each party’s domestic political process.
The treaty’s preamble is revealing. It notes that the United States “already has arrangements pursuant to which its armed forces are stationed in the Philippines, and has armed forces and administrative responsibilities in the Ryukyus“. The treaty is framed as extending an existing US posture architecture to Australia and New Zealand, not as a partnership between equals.
ANZUS guarantees nothing. As James Curran reminds us, Whitlam asserted that “adherence to ANZUS does not constitute a foreign policy,” and the United States refused to equate ANZUS with NATO. ANZUS was not invoked until Howard unilaterally did so in 2001. The treaty’s language is the language of consultation. The architecture built on it is the architecture of US force posture.
2.2 The Force Posture Agreement (2014)
The Force Posture Agreement is the operational instrument. Signed in Sydney on 12 August 2014, it provides the “policy and legal framework, as well as cost-sharing principles, to support the continued implementation of US force posture initiatives”. It explicitly recalls the ANZUS Treaty in its preamble.
The key provisions are asymmetrical:
· The US is granted access to “Agreed Facilities and Areas” without rental or similar charges.
· Where the US undertakes construction, it is granted operational control for the duration of the construction activity — the requisite basis under US law for funding military construction projects overseas.
· Australia retains primary responsibility for security of the facilities, but both parties cooperate on protection measures.
The Australian Senate was told in 2026 that “access to and use of Australian facilities and areas are on a rotational basis, mutually determined and at Australia’s invitation”. That is the official language. The structural reality is that the US has direct control of or access to over 100 Australian military bases.
2.3 AUKUS (2021–2025)
AUKUS is not an ANZUS instrument. It is a separate trilateral “enhanced security partnership” between Australia, the UK, and the US, announced on 15 September 2021. The legally binding instrument is the Agreement among the Government of Australia, the Government of the United Kingdom, and the Government of the United States of America for Cooperation Related to Naval Nuclear Propulsion, which entered into force on 17 January 2025.
The agreement permits the transfer of nuclear material and naval nuclear reactors among the three governments. It supersedes a 2022 agreement that permitted only the transfer of Naval Nuclear Propulsion Information. Former Prime Minister Malcolm Turnbull stated in 2026: “AUKUS involves a colossal sacrifice of sovereignty; there’s no question about that”. The Greens’ dissenting report on the AUKUS treaties concluded that “Australia is at the bottom rung of AUKUS“.
2.4 Supporting Instruments
Two further treaties support the architecture:
· The Australia–US Defence Trade Cooperation Treaty (signed 2007, ratified 2010) establishes an “Approved Community” of government facilities and private companies in both countries, enabling trade in defence articles without the administrative delays of export control regulations.
· The Agreement concerning Cooperation in Defence Logistic Support (CDLSA, 1989) and the Acquisition and Cross-Servicing Agreement (ACSA, 2010) provide the logistics framework for the force posture initiatives.
2.5 The AUSMIN Process
The Australia–United States Ministerial Consultations (AUSMIN) is the annual forum where the alliance is managed. It is not a treaty, but it is the mechanism through which the Force Posture Agreement and other initiatives are advanced. Each AUSMIN meeting produces new initiatives, new commitments, new integration. The accretion is continuous.
3. The Mechanisms of Lock-In
The lock-in is not in the language. It is in the capability.
1. Interoperability. Every weapons system Australia acquires is designed to work with US systems. The F-35, the M1 Abrams, the Tomahawk missiles, the future nuclear-powered submarines — all require US parts, US software, US maintenance, and US authorisation for use. The F-35’s Mission Data Files, which determine how the aircraft operates in combat, are managed by the United States and cannot be independently modified by Australia. Owning the airframe is no longer enough.
2. Pre-positioned stockpiles. The Bandiana warehouses in Victoria are being built to hold US equipment for “training exercises in Australia and within the Pacific theatre“. That is not a generic capability. It is a facility designed for a specific theatre.
3. Industrial integration. Port Wakefield manufactures GMLRS — a US-designed, US-licensed, US-standard missile. The Dublin precinct in South Australia is zoned to feed US defence primes. Australian industry is being woven into the US defence supply chain, which means Australian jobs depend on the continuation of the US alliance architecture.
4. Nuclear propulsion. AUKUS commits Australia to nuclear-powered submarines — a capability that creates a 30-year dependency on the US and UK for training, technology, maintenance, and disposal. There is no exit strategy. The cost is estimated at up to A$368 billion over 30 years.
5. Intelligence integration. The Five Eyes arrangement, the Pine Gap facility, and the growing data-sharing architecture create a system in which Australia’s intelligence is fused with US intelligence. To disentangle would mean losing access to the intelligence Australia relies on.
6. The AUSMIN process. Each annual meeting produces new initiatives, new commitments, new integration. The accretion is continuous.
4. The Absence of Independent Review
There has been no comprehensive, independent review of the Australia–US alliance since the Whitlam government.
· Whitlam (1972–1975) asserted that “adherence to ANZUS does not constitute a foreign policy“. He questioned whether the alliance required Australia to support American policies in Asia. In Parliament on 3 April 1974, he said: “The Australian government takes the attitude that there should not be foreign military bases, stations or installations in Australia. We honour agreements covering existing stations. We do not favour the extension or prolongation of any of those existing ones.”
· Fraser (1975–1983) maintained the alliance but had security policy differences with Washington. In 2015, he said: “Australia’s position is so close to that of the United States that its capacity to make independent decisions is severely limited…we are now totally captive and interoperability has become, if you like, America’s new imperialism.”
· Hawke (1983–1991) advised Washington that “Australia is not and cannot be a non-aligned nation”. He placed the relationship on a “new plane of well-supported bipartisan stability”.
· Keating (1991–1996) continued the alliance but has since become its most vocal critic, stating in 2026 that AUKUS “is locking Australia into a potential conflict between the US and China”.
· Howard (1996–2007) invoked ANZUS for the first time after the September 11 attacks. This was a unilateral act by the Australian government, not a mutual decision.
· Since Howard, it has become “axiomatic for Australian governments to support, without serious qualification, the main thrusts of American security policy”.
The 2016 ASPI analysis noted that “while the politicians and security communities in the US and Australia continue to genuflect to ANZUS, the attitudes of the public in both countries may be less ebullient”. No government has commissioned a cost-benefit analysis of the alliance that asks: what does Australia give, what does Australia receive, and what are the liabilities?
5. Rationality and Rationalization
The distinction between rational decision-making and rationalization is the key analytical tool. Rational decision-making weighs costs, benefits, alternatives, and risks. Rationalization constructs justifications for a decision that has already been made.
The AUKUS decision is a case study in rationalization.
· The decision was made in secret in 2021, without public debate or parliamentary scrutiny.
· The justification was constructed afterward: the “rules-based order,” the “threat from China,” the “need for capability.”
· The costs were not disclosed: the A$368 billion price tag, the sovereignty implications, the opportunity costs.
· The public inquiry launched in 2026 is the first attempt to subject the decision to rational scrutiny.
The academic literature describes AUKUS as a “mutation of neoliberalism” that “reconnects business, politics, and military networks in new ways“. The “various notions of geopolitics strongly embedded within AUKUS (e.g. supply-chain resilience, technological advance, industrial sovereignty) obscure the nature of the capitalist economy that combines financial capital, state capital, and industrial capital.”
That is the rationalization: the geopolitical language obscures the economic architecture.
6. Whose Interests Are Served? The US Industrial Base Problem
The US Navy “now openly admits fleet growth stagnated” due to “delays and industrial limitations”. The US submarine industrial base is “already struggling to keep up with domestic demands“. Australia’s AUKUS funding is being used to bolster the US industrial base, not to build Australian capability.
The UK shipbuilding industry is “in disarray,” and the British are “more aware of that than anyone”. The industrial base in all three countries “did not collapse because defence companies suddenly became greedy. It shrank because governments spent 30 years cashing in the post-Cold War peace dividend and stopped providing predictable long-term demand.”
AUKUS is, in part, a mechanism to sustain the US and UK defence industrial bases with Australian funds. The Australian public is paying for American and British shipyard capacity, not for Australian submarines.
The opportunity cost is real. The same funds could be invested in Australian industry, infrastructure, health, education, and housing. The US faces its own internal crises in “health care, education, housing“. The architecture serves neither the Australian people nor the American people. It serves the defence-industrial networks that profit from perpetual preparation for conflict.
7. The Revolving Door: Politics, Lobbying, and the Defence Industry
The alliance architecture is sustained by a revolving door between government, the defence industry, and lobbying firms.
Analysis by Four Corners identified at least 60 former defence ministers, senior officers, and officials who have moved into weapons firms or lobbying companies. Former defence minister Christopher Pyne co-founded lobbying firm Pyne & Partners within months of retiring from politics in 2019. He says it is “number one in defence“. Former Labor defence minister Joel Fitzgibbon is a “special counsel” to lobbying firm CMAX Advisory, which has secured government contracts for major defence companies and weapons manufacturers. Former Labor defence materiel minister Mike Kelly served as the Australian president of Palantir from 2020 to 2024.
Greens defence spokesperson David Shoebridge describes AUKUS as “like a feast. It’s this multi-billion-dollar feast for lobbyists. In a $400 billion program, there are entire careers, entire harbourside mansions [and] new…”
The revolving door creates an unfair playing field where former officials can use their connections to potentially influence the awarding of multimillion-dollar contracts. Critics say it is “corrosive of public trust”.
The think tank sector is also implicated. The Department of Defence is ASPI’s “largest source of funding”. The government funds the strategic policy sector at approximately $40 million per year. The Defence Strategic Policy Research Program provides $58.3 million in operating funding from 2027–28 to 2031–32. The sector that produces the intellectual justification for the alliance is funded by the department that benefits from it.
8. Bipartisanship as a Mechanism of Control
The alliance is sustained by a bipartisan consensus that has effectively removed defence and foreign policy from democratic contestation.
Dr Andrew Carr of the ANU argues that “bipartisanship as it currently operates in Australia is not only failing to meet its expectations but actively impeding Australia’s national security.” He states that “bipartisanship has served to reduce policy quality, creativity, flexibility and accountability” and that “the habit of bipartisanship has restricted engagement and consideration of Australia’s strategic and defence challenges.”
Carr’s central argument is that “the fundamental assumption of bipartisanship is that elites are better at making strategic decisions, or can do so independently of politics. This is doubtful.” He notes that “many of the key defence challenges facing Australia are not technical, but political, going to the kind of country we are, the commitments we make to others, the order we wish to live in and the costs we would pay to enable and protect that order.”
The parliamentary record confirms the closed nature of the debate. When the Defence Amendment (Parliamentary Joint Committee on Defence) Bill was debated in 2024, a government member stated that “it is only the members of parties of government who should sit on this vitally important committee that will oversee the AUKUS arrangement, the largest defence procurement project ever undertaken by this government“. The Greens, who want to “abolish the ANZUS Treaty,” were to be excluded. The committee was designed to ensure automatic inclusion of Labor and Liberal parties, with guaranteed seats for minor parties including One Nation, the Nationals and the Greens, but the government’s willingness to water down the committee was described as “of great concern” because it would “fundamentally weaken our position“.
Australia is unique among AUKUS partners in lacking a dedicated parliamentary defence committee. The committee that was eventually established is a “secret” committee whose members are decided by the Prime Minister and the Opposition Leader, with Greens and independents excluded.
The bipartisan consensus is not a reflection of genuine agreement. It is a mechanism for managing dissent. As Carr notes, “bipartisanship does not keep politics out, it simply hides it from the public.”
9. The Domestic Political Function of Alliance Rhetoric
The alliance serves a domestic political function that is independent of its strategic rationale. It provides a language of national identity — the “Anzac spirit,” “shoulder to shoulder,”“shared values” — that can be deployed to manage public attention and legitimise expenditure.
The Guardian’s economics correspondent Greg Jericho wrote of his “deep contempt for a party using the days before Anzac Day to announce a jingoistic $21bn in defence spending and which talks about putting us on a ‘war footing’.” He asks the question that is often linked to Anzac Day: what is the opportunity cost?
The political function is precise. It is easier for Australian politicians to play at the game of soldiers and refer to the Anzac spirit than to effectively deal with the social issues faced by Australians — homelessness, aged care, the NDIS, veterans’ affairs, children living in poverty. The defence portfolio offers bipartisan cover, the prestige of statecraft, and the support of a well-funded think tank and lobbying ecosystem. Social policy offers none of these things.
The budget spending priorities reflect the choices made by successive governments. Between 2013 and 2023, NDIS funding grew at 11.1% per year, aged care at 4.7%, and defence at 3.5%. Defence spending, however, is now on a trajectory to nearly double in dollar terms over the next decade, from $56 billion to over $100 billion. The 2026–27 budget committed an additional $53 billion over the decade, bringing total defence funding to $887 billion to 2035–36.
The Rabobank analysis describes the Australian government as facing a “‘guns or butter‘ choice between increasing the defence budget to expand capability or increasing spending on social programs like the National Disability Insurance Scheme (NDIS), aged care, and childcare.” It notes that “clearly, Australia is currently choosing ‘butter’ but retains substantial headroom in the budget to increase spending by comparison to peer economies.”
The “have-your-cake-and-eat-it-too approach carries risk that Australia will be forced into supporting US foreign policy interests against its own, while also being underprepared if a major conflict were to break out.”
10. Algorithmic Governance and the Amplification of Defence Priorities
The Australian government’s use of algorithms and artificial intelligence is not neutral. It is configured to serve the architecture of the alliance and the priorities of the market-state.
The Department of Defence has developed the NITRO portfolio selection tool, which was used in 2019 to support a major force structure review. The 2024 Integrated Investment Program committed A$8.5 billion to A$11 billion to enterprise data. AI is “now financed across almost every line of the Australian defence budget. It is not, however, governed across them.”
The ADF is “integrating AI faster than it can govern it.” The Australian Strategic Policy Institute recommends “thresholds that slow AI-assisted decision cycles at key escalation points, auditable decision-support for high-stakes outputs, and a clear position on the limits of AI in Australian defence decision-making.” These safeguards do not exist.
The consequence is structural. The algorithms used for portfolio selection, force structure review, and capability planning are optimised for the architecture they are designed to serve. They measure what the alliance requires. They do not measure what the citizen needs. The same algorithmic lens that processes welfare recipients as data points processes defence spending as a portfolio optimisation problem.
Australia’s defence debate “is no longer centred primarily on ships, aircraft or missiles. It has now shifted the discussion to the software, data and AI systems embedded within them.” The “critical question being asked by policymakers and researchers alike is how much of this stack Australia can independently govern.” The answer today, according to the Australian Institute of International Affairs, is: very little. Australian forces “operate through foreign software, proprietary data systems and digital architectures that often cannot be independently audited, modified or governed within Australia.”
11. The Public and the Elite: A Divergence
The public is not aligned with the elite consensus.
A YouGov poll of 1,502 Australians in March 2026 found that 59% believe the country’s interests are better served by pursuing a more independent foreign policy, compared with just 23% who favoured a closer alliance with the US. Only one in eight Australians regard the US as a “very reliable” security ally, while more than half consider it unreliable overall. One-third believe AUKUS is not in the country’s best interests.
The poll was conducted by The Australia Institute between March 12 and 19, 2026. Emma Shortis, director of the institute’s international and security affairs program, said the findings mark a “significant shift” in Australian opinion. The change was driven by “the US administration’s assault on the institutions and norms of international law, and by what many Australians see as Washington’s contemptuous treatment of its traditional allies.”
The public is responding to the “volatile” behaviour of the US administration and its “contemptuous treatment of its traditional allies.” The political class is not.
12. Conclusion: The Architecture and the Language
The architecture says one thing. The language over time says another.
The architecture is a US force posture system that uses Australian territory, Australian funding, and Australian industrial capacity to sustain American global power projection. The language is the language of “mutual consultation,” “sovereignty,” “rules-based order,” and “shared values.”
The gap between them is the rationalization. The decision to host US force posture was made decades ago and has been renewed without independent review. Each new instrument — the Force Posture Agreement, AUKUS, the defence trade treaties — accretes the lock-in. None of them names China. All of them are designed for a contingency in which China is the adversary.
The rational decision would be to conduct an independent, public review of the alliance: what does Australia give, what does Australia receive, what are the risks, what are the alternatives. That review has not been conducted. The rationalization continues instead.
The revolving door, the bipartisan consensus, the think tank funding, the domestic political function of Anzac rhetoric, the algorithmic amplification of defence priorities — these are not separate phenomena. They are interlocking mechanisms that sustain the architecture and prevent it from being questioned.
Australia is not being forced into an anti-China position. It is being structured into one. The structuring is not in the language. It is in the capability. And the capability is being built with Australian consent, Australian funding, and Australian territory.
The question is not whether Australia is sovereign. It is whether sovereignty includes the capacity to change position. The architecture being built makes change extremely difficult. That is the lock-in.
Claim- Status -Summary
# -Claim -Status
1 -ANZUS Article IV is deliberately vague -Established
2 -ANZUS preamble frames treaty as extending US posture -Established
3 -Force Posture Agreement grants US access without rental- Established
4- US has access to over 100 Australian military bases -Established
5 -AUKUS creates 30-year dependency on US and UK -Established
6- AUKUS cost estimated at A$368 billion over 30 years- Established
7- No independent alliance review since Whitlam -Established
8 -Whitlam opposed foreign bases in Australia -Established
9- Howard invoked ANZUS unilaterally in 2001 -Established
10- 60+ defence insiders moved to lobbying/industry -Established
11- ASPI’s largest funding source is Defence- Established
12- Bipartisanship “hides politics from the public” (Carr) E-stablished
13- Australia unique among AUKUS partners in lacking defence committee -Established
14 -59% of Australians favour independent foreign policy- Established
15- Only 13% regard US as “very reliable” ally -Established
16 -One-third believe AUKUS not in Australia’s interests- Established
17- US Navy fleet growth “stagnated” due to industrial limitations- Established
18- AUKUS funding bolsters US industrial base -Inference
19- Alliance serves domestic political function- Inference
20- Algorithms amplify defence priorities over social needs- Inference
21- Specific intent to suppress debate -Speculation
References
1. Australian Government. (2026). About the National AI Centre. https://www.ai.gov.au
2. Australian Government. (2025). Agreement among the Government of Australia, the Government of the United Kingdom, and the Government of the United States of America for Cooperation Related to Naval Nuclear Propulsion.
3. Australian Government. (2014). Force Posture Agreement between Australia and the United States.
4. Australian Government. (1951). Security Treaty between Australia, New Zealand and the United States of America (ANZUS).
5. Australian Government. (1963). Agreement concerning the Status of United States Forces in Australia (SOFA).
6. Australian Government. (1989). Agreement concerning Cooperation in Defense Logistic Support (CDLSA).
7. Australian Government. (2007). Australia–US Defence Trade Cooperation Treaty.
8. Australian Government. (2010). Acquisition and Cross-Servicing Agreement (ACSA).
9. Broinowski, A. (2017, May 8). Reading Room: Fighting with America. Australian Institute of International Affairs.
10. Carr, A. (2017). I’m here for an argument: Why bipartisanship on security makes Australia less safe. The Australia Institute.
11. Carr, A. (2019). Submission to the Inquiry into the benefits and risks of a Bipartisan Australian Defence Agreement. Parliament of Australia.
12. Curran, J. (2016). Fighting with America: Why saying no to the US wouldn’t rupture the alliance. Penguin Books.
13. Four Corners. (2026, August 23). Dozens of government insiders lobbying for defence industry, analysis shows. ABC News.
14. Fraser, M. (2015). Address to the Australian Institute of International Affairs.
15. Hooper, V. (2025, October 23). Managing warlords in the workplace: Inside Australia’s bureaucratic feudalism. Independent Australia.
16. Jericho, G. (2025, April 23). Australia needs more than hollow words about a fair go. The Guardian.
17. Keating, P. (2026). Public statement on AUKUS.
18. Parliament of Australia. (2024). House of Representatives Hansard, Defence Amendment (Parliamentary Joint Committee on Defence) Bill 2024.
19. Parliament of Australia. (2025). Defence Amendment (Parliamentary Joint Committee on Defence) Bill 2025.
20. Pearls and Irritations. (2026, June 26). Fraser, Whitlam, Albanese and national sovereignty.
21. Rabobank. (2025). Australian Economic Statecraft.
22. The Guardian. (2025, June 15). Aukus will cost Australia $368bn. What if there was a better, cheaper defence strategy?
23. The Strategist. (2026, June 24). The ADF is integrating AI faster than it can govern it. ASPI.
24. Turnbull, M. (2026). Evidence to the AUKUS Public Inquiry.
25. YouGov. (2026). Poll for The Australia Institute, March 12–19, 2026.
Andrew Paul Klein is a writer and analyst based in Boronia, Victoria. He accepts funding from no one.
A solitary figure stands above a city where modern towers meet dense neighborhood life.
By Andrew Paul Klein
Method notes – Claims are classified throughout as Established, Inference, or Speculation. The paper examines the transformation of the Prime Minister’s role in Australia, the gap between political rhetoric and delivered outcomes, and the structural logic of the market-state. The final section examines the claim that the government is building infrastructure to protect the gap rather than the citizen, and the evidence for the capability and governance failures that make this infrastructure dangerous.
Abstract
This paper argues that the Albanese government’s record shows a consistent gap between stated commitments and delivered outcomes, and that this gap is not a function of incompetence but of the operational logic of a market-state reconfigured to serve the extraction model. It traces the historical transformation of the Prime Minister’s role from national manager to market steward, documents the promises and outcomes across housing, the NDIS, aged care, veterans’ affairs, military spending, migration, Gaza, and China relations. It examines the government’s approach to artificial intelligence, contrasting the rhetoric of control with the reality of algorithmic deployment and capability decline. It concludes that the gap between promise and outcome is the structural condition of the market-state, and that the infrastructure being built to manage that gap is itself failing the citizen.
1. Introduction: The Gap
The Albanese government’s record shows a consistent gap between its stated commitments and its delivered outcomes. On housing, the government promised to fix the crisis and delivered a supply-side intervention that its own tax changes will undermine. On the NDIS, it promised to secure the scheme and delivered a market-efficiency measure. On aged care, it promised better care and invested in the supply side of a market that cannot meet demand. On military spending, it promised security and locked the nation into a thirty-year dependency.
This paper asks whether that gap is a failure of governance or the operational logic of the system itself. The evidence points to the latter. The Prime Minister is not the head of a national project. He is the chief executive of a market-state, managing the flow of capital, labour, and data in the interests of the extraction economy.
2. The Transformation of the Prime Minister’s Role
2.1 From Cabinet Government to Prime Ministerial Government
The traditional model of the Prime Minister was that of a first among equals within a Cabinet. The Cabinet was a “board of control” that joined the legislative and executive parts of the State. Power was collective.
By the 1960s, scholars like John Mackintosh argued this had been replaced by a “Prime Ministerial System.” Richard Crossman went further, claiming the British system had acquired a “presidential” tendency, with the Prime Minister effectively functioning as an elected first magistrate. This shift was driven by the increasing personalisation of political news and the media’s focus on the leader.
In Australia, this presidential drift is visible in the revolving-door leadership spills—Rudd, Gillard, Rudd, Abbott, Turnbull, Morrison—where party room ballots, not the public, determined who held the office. The public face of the PM became a marketing asset for the party, but the actual power to hire and fire remained with the party room.
2.2 The Post-War Settlement: The National Manager
Following World War II, the role did change. The war had expanded the powers of the executive, and the post-war reconstruction required a national, inclusive approach. This was the era of the “social wage” and the post-war settlement. The PM was still a partisan figure, but the project was national—building the welfare state, managing the mixed economy. The Prime Minister of this era was a national manager.
2.3 The Hawke Precursor and the Neoliberal Rupture
The Hawke-Keating governments (1983–1996) were the pivot point. They began dismantling the post-war settlement under the banner of “economic rationalism.” The Hawke government’s Prices and Incomes Accord with the ACTU was a corporatist deal: unions traded wage restraint for a “social wage” (Medicare, superannuation). This was an inclusive approach, but its purpose was to manage the transition to a deregulated, market-driven economy. The “inclusivity” of the Hawke era was a managed consensus for structural change.
2.4 The Neoliberal PM: The Manager of the Deal
After Hawke and Keating, the role morphed again. The post-war project—building a national society—was replaced by the neoliberal project: managing the market, the budget, and the “deal.”
The language that describes this role is “market designer and market steward” and “manager of the deal.” The Prime Minister is no longer the head of a national project. They are the chief executive of a market-state. Their job is to manage the economy, attract investment, and process citizens as data points.
The actual performance is often at odds with the public understanding. The public still expects a national leader who represents their interests. What they get is a partisan manager whose primary obligation is to the market and the party room, not the citizen.
Era Role Basis of Authority Public Expectation
Post-War Settlement -National Manager Inclusive national project- Leader who builds a fair society
Neoliberal Era -Market Steward / Manager of the Deal -Party room + Market confidence -Partisan representative (but actual performance is market management)
The “inclusive and embracing approach” of the post-war era was a specific historical project. Neoliberalism did not abandon “inclusivity” as a rhetorical device—it repurposed it. The PM now speaks of “inclusion” in terms of market access, not social solidarity. The public expects a national representative. The system delivers a market manager. The gap between those two things is where the disappointment, the cynicism, and the drift to the right lives.
3. The Promises and the Outcomes
3.1 Housing
The government promised 100,000 homes for first home buyers and a “$45 billion plan” to fix the housing crisis. The first deal, with South Australia, was struck in January 2026 for 17,000 homes—nearly 7,000 for first home buyers. But the structural problem is not being addressed. The government’s own tax changes are projected to reduce supply by 35,000 dwellings and increase rents. The promise is a supply-side intervention in a market that is being simultaneously taxed and constrained.
3.2 NDIS
The government promised to “secure the NDIS for future generations.” The legislation introduces automated decision-making with “safeguards” that the government claims preserve review rights and human oversight. But the funding changes will impact social, economic, and community participation supports—the very supports that help people get out of bed and into the world. The “new way of planning” will introduce support needs assessments from April 2027, developed with the University of Melbourne, to “create fairer budgets.” The language is of sustainability and fairness. The outcome is a scheme that processes participants more efficiently.
3.3 Aged Care
The government promised “better care for older Australians” and invested $3.7 billion to deliver “more beds, more packages and better care.” Personal care—showering, dressing, continence support—will be free. But the aged care system is still characterised by waiting lists, workforce shortages, and a market model that treats care as a commodity. The government is funding the supply side of a market that cannot meet demand.
3.4 Veterans
The government committed to implementing the Royal Commission into Defence and Veteran Suicide. Two years on, 32 recommendations have been implemented, and the government is “on track” for two-thirds by the end of 2026. A new Veteran and Family Wellbeing Agency commenced in July 2026. But the claims system remains difficult, and the mortality rate for veterans remains a documented crisis. The reforms are real. They are also slow, and the structural causes of veteran distress are not addressed by an agency.
3.5 Military Spending and AUKUS
The government has committed an additional $53 billion over the decade, bringing total defence funding to $887 billion to 2035-36. This is the largest peacetime increase in defence spending in Australia’s history. AUKUS is “full steam ahead,” with the Henderson Defence Precinct selected and $8 billion committed to HMAS Stirling. The structural reality is that Australia is locking itself into a 30-year military-industrial dependency on the United States and the United Kingdom, funded by the same budget that is cutting disability supports.
3.6 Migration
The permanent migration program remains at 185,000 places, with a 70:30 split between skilled and family migration. The government is prioritising onshore migrants, allocating 129,590 places to those already in Australia. Migration is being managed as a labour market variable, not as a humanitarian or family reunification program.
3.7 Gaza and Palestine
Australia recognised the state of Palestine on 21 September 2025. The government has sanctioned two Israeli ministers in connection with human rights abuses in the West Bank. But when asked what Australia has done to prevent genocide in Gaza, Foreign Minister Penny Wong said: “we do not supply.” The government continues to export F-35 components to Israel through a secret pipeline. The recognition of Palestine is a diplomatic gesture. The material support for Israel’s military continues.
3.8 China and the United States
The government is deepening its alliance with the United States through the critical minerals framework, with over $5 billion in joint funding for projects. At the same time, Foreign Minister Wong met with Chinese Foreign Minister Wang Yi in April 2026 to strengthen the “comprehensive strategic partnership.” Australia is managing the tension between its security alliance with the US and its economic dependence on China. The structural position is one of hedging, not sovereignty.
4. The Algorithmic Government
4.1 The Rhetoric of Control
The Prime Minister speaks of “managing the risks” of AI and ensuring that “your investment is welcome, but these are the conditions.” An Office of AI has been established in the Department of Prime Minister and Cabinet on 15 July 2026 to “coordinate across Australian Government agencies to design and legislate the new Australia artificial intelligence standard”. The government is developing “Australian standards” and plans to legislate them. The Prime Minister frames this as “Australia choosing to shape the future rather than letting the future of AI shape us”.
4.2 The Reality of Deployment
The government is already using algorithms extensively. The NDIS legislation explicitly authorises automated decision-making. The Attorney-General’s Department has been developing a framework for automated decision-making in government services since at least 2024, with the framework “intended for 2026.” Meanwhile, the government is fast-tracking data centre approvals before the legislation to regulate them is written.
4.3 The Capability Deficit
The evidence for the government’s capability to manage this infrastructure is weak.
Federal expenditure on IT temporary personnel nearly tripled over a three-year period, surging from about $289 million in 2022-23 to more than $808 million in 2025-26. The volume of outsourcing arrangements increased more than 1.5 times, with the number of individual contracts climbing from 436 to 1,104.
Since 2023, most federal agencies have been identified as having a critical skills shortage in the Australian Public Service Commission’s State of the Service reports. In those agencies, digital and ICT deficiencies were the most widespread and fastest-growing blind spots, with the proportion of departments reporting these specific shortfalls rising from 76 per cent in 2023 to 81 per cent in 2024, and peaking at 85 per cent in 2025.
Nearly two in three short-staffed agencies lacked enterprise and technology architects to manage internal digital transformations, and more than half identified a critical deficiency in the training and development of artificial intelligence models.
The government’s flagship Digital Traineeship Program—designed to place 1,000 candidates into technical roles—was axed after only 73 sign-ups across the entire public service. APSC officials said agencies failed to register demand because they were focused on hiring ready-made experts rather than investing internal resources into mentoring entry-level staff.
The committee examining public sector IT procurement found “shortfalls in capability, planning and management at Commonwealth entities for external information technology contracts.” It noted that “outsourcing can perpetuate their capability loss and continue to trend towards reliance on external contractors”.
4.4 The Governance Failure
The ANAO’s audit of AI governance at the ATO found significant gaps. The ATO “does not have policies and procedures supporting the monitoring and evaluation of its in-house built AI models.” For the 14 AI models built and deployed between 1 July 2023 and 14 May 2024, there was no evidence of ongoing performance monitoring and reporting.
Of the 33 Protective Legal Instructions for the 14 AI models, 18 (55%) were approved and there was no evidence of approval for 15 (45%).
The ANAO identified “information management issues throughout the course of the audit including poor records of: governance, planning and oversight; risk management; activities throughout the AI system lifecycle; and key decisions.”These issues “have impacted the ability of the ATO to demonstrate transparency and accountability with respect to its adoption of AI”.
4.5 The Palantir Model
Palantir Technologies holds contracts across Australian government agencies. In Victoria, Corrections Victoria alone has handed Palantir nearly $20 million in contracts since 2012, while federal agencies including Defence spent over $100 million on similar contracts.
An AusTender contract notice dated 18 February 2026 shows Palantir Technologies Australia Pty Ltd engaged by the Australian Transaction Reports and Analysis Centre (AUSTRAC) for “implementation and sustainment services for Transaction Reporting solution,” valued at $1,883,729.10, with extension options to 2032.
The Tasmanian government confirmed in a Legislative Council question that all Tasmanian State Service departments “have not awarded contracts to Palantir Technologies or its subsidiaries”. This is the exception, not the rule.
4.6 The Structural Read
The government fears AI as a threat while deploying it as an instrument. The fear is of a competitor. The deployment is of a tool. The Office of AI is not a regulator. It is a control point—a mechanism for the Commonwealth to shape the AI environment in Canberra’s interests.
The evidence suggests that the government lacks the internal capability to manage the infrastructure it is building. It is reliant on the very contractors—Palantir, Accenture, the consultancy layer—whose interests are served by the extraction model. The “control” the Prime Minister speaks of is not control over AI. It is control over the narrative of AI.
5. The Structural Read
The Albanese government is not failing to deliver on its promises. It is delivering on the system’s promises, which are not the same as the promises made to the electorate.
The market-state does not promise housing, healthcare, or social security. It promises market access. The housing package is a supply-side intervention. The NDIS reforms are a market-efficiency measure. The aged care investment is a capital subsidy to providers. The military spending is an industrial policy for the defence sector. The migration program is a labour market tool. The Gaza recognition is a diplomatic hedge.
The public expects a national representative. The system delivers a market manager. The Prime Minister is not the head of a national project. He is the chief executive of a market-state, managing the flow of capital, labour, and data in the interests of the extraction economy.
The gap between the promise and the outcome is not a failure of governance. It is the operational logic of the system we examined in the ten chapters. The state sees what the lens shows. The lens was designed to see what the market requires. And the market requires the flow to continue.
The citizen is in the gap. And the government is building the infrastructure to guard it.
5.1 The Verification Question
The claim that “the government is building the infrastructure to protect the gap, not the citizen” requires precision. What can be established:
· The government is deploying algorithmic decision-making systems across human services (NDIS, ATO, employment services).
· The government is establishing an Office of AI in PM&C to coordinate AI governance and standards.
· The government is fast-tracking data centre approvals before regulatory legislation is written.
· The government’s internal IT capability is declining while outsourcing expenditure triples.
· AI governance at the ATO has documented failures in monitoring, evaluation, and information management.
· Palantir holds contracts across multiple Australian government agencies.
What is inference:
· The infrastructure being built serves the extraction model rather than the citizen.
· The capability deficit and governance failures mean the infrastructure cannot be safely managed.
· The “control” being sought is narrative control, not operational control.
6. Conclusion: The Gap and the Citizen
The gap between the rhetoric and the reality of the Albanese government is not an aberration. It is the structural condition of the market-state. The Prime Minister is not a national manager. He is a market steward. The promises made to the electorate are not the promises the system delivers.
The government is building infrastructure to manage the gap—algorithmic systems, data centres, AI standards, coordination offices. But the evidence suggests that the infrastructure is failing. The capability is declining. The governance is weak. The contractors are filling the void. And the citizen is still in the gap.
The question is not whether the Albanese government will change. It will not. The question is whether the governed will continue to accept the terms of a relationship that was never offered, only imposed.
Claim- Status- Summary
# -Claim -Status
1- PM role shifted from Cabinet to Prime Ministerial system -Established
2- Post-war PM was a national manager- Established
3 -Hawke/Keating were the pivot to neoliberalism -Established
4 -Neoliberal PM is a market steward -Inference
5 -Housing promise undermined by own tax changes -Established
5. Institute of Internal Auditors Australia. (2026). RoboDebt’s Real Lesson: When the Assurance Architecture Fails Completely. https://www.iia.org.au
6. Australian National Audit Office. (2025). Governance of Artificial Intelligence at the Australian Taxation Office. https://www.anao.gov.au
A reader presents an annotated book page filled with diagrams, theories, and alternative interpretations.
By Andrew Paul Klein
Method notes. Claims are classified throughout as Established, Inference, or Speculation. This is the first chapter of a companion volume to The Neoliberal Turn. It examines the long arc of the relationship between the governed and those who govern, from the ancient city-state to the algorithmic present.
1. Introduction: The Question of the Relationship
Every political order rests on a relationship. The relationship is never between abstractions. It is between people who govern and people who are governed. It has terms. It has obligations. It has a basis of legitimacy. And when the terms change — when the obligations are not met, or the legitimacy is withdrawn — the order changes with them.
This chapter traces that relationship across three thousand years. It does not claim that history is linear. It does not claim that progress is inevitable. It claims something narrower and more useful: that the relationship between the governed and those who govern has been redefined by a series of ruptures, and that each rupture established a new configuration of rights, obligations, and legitimacy. The current configuration — the algorithmic, transactional state — is the most recent. And it is the one we are living through.
The method is structural. The question is not whether a particular era was just or unjust. The question is: what was the relationship, and what defined it?
2. Phase One: The City-State and the Citizen
2.1 Athens
In the Athens of the sixth to fourth centuries BC, citizenship was not a set of rights. It was a set of duties. The citizen was expected to engage in public affairs, to serve, and to live according to shared values and rules. The Greek concept of citizenship was “active participation in the polis”.
Entitlement was exclusively male. Women, slaves, and the foreign-born were excluded. A man became a citizen by degrees — through family membership as a boy, then a phratry, then a tribe, and finally the city at around eighteen. The binary oppositions that structured the society were “civilized–barbarians,” “free–dependent,” “property-owning–not,” “adult–minor.” Only a small fraction of the population had citizen rights.
The relationship was vertical. The citizen participated in governance. The vast majority of the population did not. The obligation was on the citizen to serve the state.
2.2 Rome
Rome replaced monarchy with a republic. Society divided between patricians and plebeians. Women, slaves, and the foreign-born could not vote or hold office. But Roman citizenship evolved to be more inclusive than Greek. Women had the right to own property, engage in business, or obtain a divorce. Certain rights were conferred on the Latins. Slaves, however, lacked legal personhood and were considered personal property.
The Roman innovation was legal. The citizen was defined by a status within a legal order. The relationship was not merely political but jurisprudential. The citizen had a place in the law, and the law defined what that place was.
What defined the governed in this phase: inclusion and exclusion. The citizen was defined by who was allowed to participate, and the vast majority were not.
3. Phase Two: Feudalism and the Rise of Monarchy
3.1 Feudalism
Feudalism was a loosely organised system in which powerful lords divided their lands among lesser lords. Lords protected vassals in exchange for loyalty, military service, and a share of crops. Serfs were peasants bound to the land and the lord. The relationship was protective and hierarchical: the lord provided security, the serf provided labour.
3.2 The Rise of Monarchies
From the 1400s, monarchs centralised power. They set up national governments with strong legal systems, taxes, and armies. They hired loyal civil servants to manage state affairs from a national rather than regional perspective. These steps fostered national identities. Monarchs now represented the centralised state and were seen as having sovereignty — absolute authority — over all subjects.
3.3 The Divine Right of Kings
Legitimacy rested on the idea that monarchs receive their authority from God. The king was not accountable to the governed. He was accountable to God. The relationship was hierarchical: the king ruled, the subjects obeyed.
3.4 Magna Carta (1215)
A critical moment. The charter promised that the king would not “sell, deny or delay right or justice” to anyone. Chapter 45 promised that justices would be appointed only from men who “know the law of the kingdom and will gladly observe it”. Chapter 17 conceded that “common pleas” were not to “follow our court” but be held in a certain place.
The charter was not a democratic document. It was a baronial document — a settlement between the king and his most powerful subjects. But it established the principle that the king was subject to law. The relationship was no longer purely vertical. It had acquired a legal dimension.
What defined the governed in this phase: protection. The governed were defined by their relationship to the lord or the king. The obligation was obedience in exchange for security.
4. Phase Three: The Execution of Charles I and the Rupture
4.1 The Divine Right Challenged
January 1649. After seven years of civil war, Parliament had defeated King Charles I. Parliamentarians resolved to do the unthinkable: to disregard the Divine Right of Kings and hold Charles to account for “the appalling suffering and slaughter endured by his people”. A tribunal of 135 men was gathered. Charles refused to acknowledge the power of his subjects to try him. The death sentence was passed unanimously. On an icy winter’s day on a scaffold outside Whitehall, in an event unique in English history, the King of England was executed.
4.2 What This Meant
The execution was not merely regicide. It was the rupture of the vertical relationship. The king was no longer accountable only to God. He was accountable to his subjects. The governed had the power to judge the governor. The restoration of Charles II brought retribution against the “regicides” — but the principle could not be undone.
What defined the governed in this phase: accountability. The governed were no longer merely subjects. They were, in principle, judges of the governor. The relationship had acquired a horizontal dimension.
5. Phase Four: Westphalia and the Sovereign State
5.1 The Peace of Westphalia (1648)
Ended the Thirty Years’ War. Generally understood as a critical moment in the development of the modern international system composed of sovereign states, each with exclusive authority within its own geographic boundaries. The Westphalian model is based on principles of autonomy, territory, mutual recognition, and control.
5.2 What Westphalia Established
The state became the primary unit of political authority. The sovereign was not accountable to external powers — the pope, the emperor. The relationship between the governed and the governor became a domestic matter. The state had the authority to determine who was a citizen, who was an alien, who could stay, who could be expelled.
What defined the governed in this phase: sovereignty. The governed were defined by their membership in a sovereign state. The relationship was territorial.
6. Phase Five: The Citizen-Soldier and the French Revolution
6.1 The Levée en Masse (23 August 1793)
A decree establishing the mass conscription of the French population to defend the Revolution. This was not a professional army or a mercenary force. It was the nation in arms. The citizen was no longer merely a subject. The citizen was a soldier — obligated to defend the state, and in return, granted a stake in it.
6.2 The Shift
Under the Ancien Régime, the militia was the primary mode of conscription. After the Revolution, the levée en masse and later the Jourdan-Delbel Law (1798) created the conscript — a citizen obligated to serve, but also a citizen with rights. The relationship was reciprocal: the state demanded service; the citizen demanded representation.
6.3 Napoleon
Consolidated the shift. The citizen-soldier became the instrument of imperial expansion. The relationship between leader and led became instrumental: the state used the citizen to achieve its ends, and rewarded the citizen with glory and spoils.
What defined the governed in this phase: reciprocity. The governed were defined by their service and their representation. The relationship was contractual.
7. Phase Six: The American Civil War and the Politics of Deliverance
7.1 The “Cause” of Liberation
Northerners marched off to war in 1861 not merely to restore the Union but to liberate the South. The theme of deliverance was essential in mobilising a Unionist coalition. As the war escalated, Lincoln and his allies built the case that emancipation would secure military victory and benefit the North and South alike.
7.2 The Reality
James Oakes demonstrates that the war aims of Liberty and Union were intertwined in Republican policy from the very start. By summer 1861, the federal government invoked military authority to begin freeing slaves as they fled to Union lines. The Thirteenth Amendment was the final act in a saga of immense war, social upheaval, and determined political leadership.
7.3 What Changed
The state now claimed a moral cause — the liberation of the enslaved. The relationship between the governed and the governor was no longer merely about territory or sovereignty. It was about values. The state could demand sacrifice not only for survival but for principle. And the governed could hold the state to account for the consistency of that principle.
What defined the governed in this phase: principle. The governed were defined by the values the state claimed to represent. The relationship had acquired a moral dimension.
8. Phase Seven: Europe Between the Wars
8.1 Nationalism and Hegemony (1815–1945)
Between 1815 and 1945, Europe achieved unrivaled global dominance, only to see it shattered by two world wars. The period saw the rise of totalitarianism and the overthrow of European hegemony in two calamitous wars. The darker forces — violent nationalism, totalitarianism, racism, ethnic cleansing — began to make themselves felt.
8.2 The First World War and Its Aftermath
The war and its aftermath profoundly changed the population structure of vast territories. It generated a proliferation of migration control policies and new citizenship claims from those who had fought or suffered. The First World War marked a departure from the quest for the universalism of rights and a shift from individuals to collectivities defined in terms of identity, belonging, language, ethnicity, religion, or class.
8.3 The State as Gatekeeper
Establishing the equation between aliens and dangerousness, the First World War consolidated the idea that policing borders, selecting who can live in the territory, expelling the unwanted, granting and stripping citizenship — were the main prerogatives of the sovereign state. The state had the power to decide whom to accept, expel, include, exclude, and endow with rights.
8.4 The Interwar Deal
During World War I, most European trade unions established a deal with national governments: unions would support the war effort — forgo strikes, regiment the workforce — if governments guaranteed legal recognition and collective bargaining. This was cemented in legislation: the Auxiliary Service Law in Germany (1916), mediation in France (1917), Lloyd George’s Munitions Acts in the UK. The relationship became corporatist: the state negotiated with organised labour, and labour traded obedience for recognition.
What defined the governed in this phase: collectivity. The governed were defined by their group — their nation, their class, their union. The relationship was negotiated between the state and organised collectivities.
9. Phase Eight: World War II and the Postwar Settlement
9.1 The Human Rights Revolution
International human rights, which incrementally assumed global constitutional force after 1945, were constructed through processes of inclusion deeply embedded in domestic societies. States developed an autonomous rights-based constitutional structure to support both their external and internal functions.
9.2 The New Relationship
The state now claimed legitimacy not merely from sovereignty but from human rights. The governed were not merely subjects or citizens. They were rights-bearers. The state’s authority was conditional on its respect for those rights. This was the postwar settlement — a state that provided security, welfare, and rights, in exchange for legitimacy.
What defined the governed in this phase: rights. The governed were defined by their entitlements. The relationship was rights-based.
10. Phase Nine: Neoliberalism and the Algorithmic Turn
10.1 The Neoliberal Rupture
From the 1980s, the postwar settlement was dismantled. The state withdrew from its role as provider of security, welfare, and rights. It became a market designer and a contract manager. The citizen became a consumer or a client. The relationship shifted from rights to transactions.
10.2 The Algorithmic Lens
The state now sees the citizen not as a rights-bearer but as a data point. The instruments — the JSCI, the IAT, the Robodebt algorithm, the ATO’s 43 AI models — measure what the market requires. The citizen is processed. The human being is in the gap.
What defined the governed in this phase: measurement. The governed are defined by what the instrument measures. The relationship is transactional.
11. The Arc
Phase Relationship Who Governs Who is Governed Basis of Legitimacy
Absolute Monarchy Hierarchical King Subjects Divine Right
Magna Carta Legal King subject to law Barons Law
Charles I Rupture Parliament Subjects Accountability
Westphalia Sovereign State Citizens/Aliens Sovereignty
French Revolution Reciprocal Nation Citizen-Soldiers Representation
Civil War Moral Union Liberated Principle
Interwar Corporatist State + Unions Organised Labour Negotiation
Postwar Rights-based Welfare State Rights-bearers Human Rights
Neoliberal Transactional Market State Consumers/Clients Efficiency
Algorithmic Processing Algorithm Data Points Measurement
The arc is not linear progress. It is a series of ruptures. Each rupture redefines the relationship. The current rupture — the algorithmic turn — is the most recent. And it is the one we are living through.
12. What This Means
The chapters we have written are not isolated case studies. They are the Australian expression of the algorithmic turn. The neoliberal rupture created the market. The market required measurement. Measurement required instruments. The instruments became the lens. The lens processes the citizen. And the citizen is in the gap.
The ATO is the clearest example: the two-tier structure was there before the algorithm, and the algorithm made the second tier more efficient at being what it already was.
That is the finding. That is the arc. And it is in the record.
Claim -Status- Summary
#- Claim- Status
1 -Athenian citizenship was active participation, exclusively male- Established
2 -Roman citizenship was more inclusive; slaves lacked legal personhood -Established
3- Feudal relationship was protective and hierarchical -Established
4 -Divine Right held the king accountable to God, not the governed- Established
5- Magna Carta established the king was subject to law- Established
6- Charles I was executed by Parliament in 1649 -Established
7- Westphalia established the sovereign state as primary unit -Established
8- Levée en masse created the citizen-soldier- Established
9 -American Civil War claimed a moral cause -Established
10- Interwar relationship became corporatist- Established
11- Postwar settlement was rights-based- Established
12- Neoliberal rupture shifted to transactional -Established
13 -Algorithmic turn processes the citizen as data point- Inference
14- The arc is a series of ruptures, not linear progress -Inference
The first chapter of the companion volume is complete. The arc is established, the phases are documented, and the Australian connection to the algorithmic turn is stated without being pre-empted. The next chapters — the morphing function, the asymmetry of voice, the collapse hypothesis, and the alternatives — follow naturally from this foundation.
The Morphing Function: From Provider to Manager of the Deal
Method notes. Claims are classified throughout as Established, Inference, or Speculation. This is the second chapter of the companion volume to The Neoliberal Turn.
1. Introduction: The Question of Function
The preceding chapter traced the arc of the relationship between the governed and those who govern across three thousand years. It ended with the algorithmic turn — the most recent rupture, in which the citizen is processed as a data point and the human being is in the gap.
This chapter asks a narrower question. What is the state for now? Not what does it claim to do, but what is its actual function in the lives of the people it governs?
The answer, supported by the evidence, is that the state has morphed from a provider to a manager of the deal. It no longer delivers services. It designs markets, contracts delivery, measures outcomes, and enforces compliance. The citizen is no longer a rights-bearer. The citizen is a participant in a market — a client, a consumer, a claimant.
This chapter documents the morphing. It traces the shift from the postwar settlement to the market state, examines the institutional architecture that translated the shift into practice, and identifies the structural consequences for the citizen.
2. The Postwar Settlement: The State as Provider
2.1 The Rights-Based Model
The postwar settlement was constructed on a simple premise: the state provides security, welfare, and rights; in exchange, the citizen grants legitimacy. This was the deal that emerged from the wreckage of the Second World War and the human rights revolution that followed.
The state-built houses. It ran hospitals. It employed nurses. It delivered pensions through public servants who knew their claimants. The relationship was rights-based: the citizen had entitlements, and the state had obligations. The obligation was not conditional on the citizen’s capacity to pay, or on the citizen’s compliance with a performance measure, or on the citizen’s location in a market. It was unconditional. It was a right.
2.2 The Institutional Form
The institutional form matched the function. The Commonwealth Employment Service (CES) had offices in every major town. The Department of Social Security had counter staff who knew their claimants. The Department of Veterans’ Affairs had case officers who managed veteran claims. The public servant was the state’s presence in the citizen’s life.
The relationship was direct. The citizen encountered the state in the person of the public servant. The public servant had discretion — the capacity to exercise judgment in individual cases. The public servant also had accountability — they could be identified, questioned, and held responsible.
2.3 The Culture of Advice
The public service also provided frank and fearless advice to ministers. The culture of the APS was built on the expectation that public servants would speak truth to power — that they would provide advice based on evidence, not on what the minister wanted to hear. This was the mechanism by which the state could correct its own errors. The voice of the public servant was the voice that could say “this is unlawful” or “this will cause harm.”
The postwar settlement was not perfect. It was bureaucratic, sometimes slow, sometimes paternalistic. But it was rights-based. The citizen had a claim on the state that did not depend on the citizen’s capacity to participate in a market.
3. The Neoliberal Rupture: The State as Market Designer
3.1 The Ideological Shift
From the 1980s, the postwar settlement was dismantled. The ideological shift was neoliberalism — a set of policies that prioritised market mechanisms, competition, and efficiency over universal provision. In Australia, the shift was driven by the Hawke-Keating reforms, accelerated under the Howard and Kennett governments, and institutionalised by the Productivity Commission.
3.2 The Productivity Commission’s Role
The Productivity Commission became the central institution for designing market-based schemes in human services. As one analysis states, the Commission has “led analysis on why, when and how market-based competition can improve human services, playing a central role in the design of key market schemes, including the NDIS and Child Care Subsidy”.
The Commission’s own framing is explicit. It recommended that government should “recognise and actively engage in its role as a market designer and market steward”. The role is not provider. Not guarantor. Designer and steward of a market.
3.3 The Institutional Architecture
The institutional architecture followed the ideology. The Howard government used the creation of Centrelink to “restructure the Public Service to commercialise, corporatise or privatise the welfare service delivery function”. The enabling legislation described the new agency’s functions in terms of “service arrangements” and “directions from the minister” — not in terms of a duty to citizens.
The market model was introduced into employment services through the Job Network — a “black-box market” in which jobseekers were referred by Centrelink to contracted providers who “had significant discretion and were contracted for results”. The system operated as a market: providers competed for business, and their performance was measured by outcomes.
The same model was extended to the NDIS, Aged Care, and veterans’ services. Each scheme was designed as a market. Each market required measurement. Each measurement required instruments.
4. The Market State: The State as Manager of the Deal
4.1 The Contract as the Relationship
In the market state, the primary relationship is not between the state and the citizen. It is between the state and the provider, governed by a contract.
The contract specifies what the provider will deliver, to whom, at what price, and according to what performance measures. The provider is accountable to the department for meeting those measures. The citizen is the object of the contract — the person to whom the service is delivered — but not a party to it.
This is a structural inversion. In the direct-delivery model, the citizen had standing. They could complain to the department. They could appeal a decision. They could, in principle, hold the state accountable. In the contracted model, the citizen’s relationship is with the provider. The provider is accountable to the state. The citizen’s ability to hold anyone accountable is mediated through the contract.
4.2 The Citizen as Client
The citizen is now a client or a consumer in the market. The NDIS participant is a consumer choosing a provider. The aged care resident is a client purchasing a package. The jobseeker is a client of an employment services provider. The veteran is a claimant in a processing system.
The relationship is transactional. The citizen has a claim on a service, and the state has a contract with a provider. The claim is not a right. It is a transaction. The state’s obligation is not to the citizen. It is to the contract.
4.3 The Performance Measure as the Lens
The contract is enforced through performance measures. The provider is paid based on outcomes. The outcomes are defined by the department. The definitions shape what the provider does.
The evidence from employment services is explicit. A parliamentary inquiry found that the system is “driven by funding and performance management arrangements” that “continues to push jobseekers into work as fast as possible”. The majority of provider payments are conditional on time in employment, and performance is judged on the time taken to place a jobseeker in work.
The consequence is structural. As Dr David O’Halloran told the inquiry, in a “pay-by-outcome, marketized employment services” system, “providers respond to the financial pressures and incentives of a system by calculating which unemployed workers offer the best return on investment and thus favour those likely to be placed into work quickly and inexpensively while neglecting those with more complex and thus more time consuming and expensive needs”.
The provider is not evil. The provider is optimising for the measure. And the measure does not see the jobseeker who needs longer-term support. It sees the outcome that generates payment.
4.4 The Distance Problem
The market state creates distance between the decision-maker and the human impact.
In the direct-delivery model, the public servant who denied a claim could see the claimant. The claimant was in front of them. The human consequence was immediate. In the contracted model, the decision is made by the provider’s staff, based on measures set by the department, and the human consequence is registered in the provider’s performance data.
The department sees the data. The provider sees the data. The citizen experiences the consequence. The feedback loop is broken.
This is not a failure of the system. It is a feature of the architecture. The distance is what allows the state to manage at scale. It is also what makes the state structurally incapable of seeing the harm.
5. The Case Studies
5.1 Employment Services
The Workforce Australia inquiry documented the structural features of the contracted employment services model. The system operates as a “black-box market“: providers are contracted for results, but the method of delivery is largely their own. The department sets the outcomes; the provider determines the process.
The inquiry heard that the system continues to push jobseekers into work “as fast as possible.” The “work first” approach leads to jobseekers being forced to accept lower-paid, lower-skilled positions, which “can be antithetical to a jobseeker’s career progression and can trap jobseekers in persistent cycles of poverty and disadvantage”.
One jobseeker told the inquiry: “I’d rather end up in a job that uses my abilities than spend my time in a low-level job for which I’m unfit”.
Another described being threatened with non-compliance reporting for refusing an unsuitable job, and having a panic attack as a result.
The provider was not acting maliciously. The provider was acting according to the incentive structure. The structure rewarded rapid placement. The provider placed rapidly. The jobseeker bore the consequence.
5.2 Veterans’ Affairs
The Community and Public Sector Union’s submission to the Royal Commission into Defence and Veteran Suicide documented the privatisation of DVA’s claims processing.
The CPSU found that “labour hire workers are NOT in specialised roles; they are doing everyday processing work. Roughly 75% of delegates are labour hire. One team I was in containing 11 delegates, only 2 were APS staff”.
DVA confirmed in Budget Estimates that it used at least 46 different labour hire providers and spent $77 million more on labour hire contractors in 2019/2020 than in 2014.
The consequence was structural. The CPSU submission states that “privatisation in the form of labour hire, contracting, and other third-party arrangements has reduced the Department’s capability to administer basic services, to respond to fluctuations in demand, and to meet its legislative requirements”.
The state had outsourced the capacity to process claims. It retained the authority to make decisions. It lost the ability to understand what it was deciding.
5.3 Aged Care
The AMA warned against the privatisation of aged care assessments. The AMA’s concern was that assessments “must remain independent of aged care providers and be delivered by health professionals, especially geriatricians who are trained in dealing with the complex medical needs of the frail and elderly”.
The AMA stated that “a market-based approach is a recipe for aged care service providers to put profits before patients”. It warned that the plan would “see states and territories required to tender for a job they already do well”.
The government proceeded. Contracts worth approximately $1.2 billion were awarded to private providers.
The consequence is structural. The assessor who determines the older person’s level of funding is now employed by a contracted entity. The entity is accountable to the department for meeting assessment targets. The older person is the subject of the assessment.
5.4 NDIS
The NDIS is a market-based scheme. Participants receive funding. Providers compete for their business. The National Disability Insurance Agency (NDIA) is the market steward.
The NDIA itself acknowledges that “competition between service providers is not enough to fuel thin markets in terms of pricing and effectiveness”.
The Rural and Remote Advisory Group raised concerns that “NDIS costs have affected the market holistically, disadvantaging non-participants” and that “thin markets are causing allied health providers to withdraw their services in remote areas”.
The state designed a market. The market does not work in all locations. The state cannot fix the market because the state no longer delivers the service. It can only steward the market, and stewardship is not delivery.
6. The Consultancy Layer
The market state does not only contract service delivery. It contracts advice.
A comparative study of policy consultancy across six countries — Britain, the United States, Canada, Australia, The Netherlands, and Sweden — found a significant increase in the volume and importance of external consultants in the public policy process.
The study addresses the implications for “the nature of the state (transforming into a contractor state?) and for democratically legitimized and accountable decision-making (transforming into consultocracy?)”.
The term “contractor state” describes the transformation. The state contracts out not only service delivery but policy design, evaluation, and implementation. The consultants who provide these services are accountable to the department, not to the public. They optimise for the contract, not for the citizen.
The ANU Policy Brief identifies the consequences: “40 years of New Public Management (NPM) reforms have weakened”the foundations of the Westminster system, “contributing to the politicisation of the public service and, at their worst, to policy disasters such as Robodebt”.
The brief notes that “NPM practices have dismantled traditional line hierarchies and outsourced core services in pursuit of higher efficiency and productivity”.
The consultancy layer is the second mediation. The provider mediates between the state and the citizen. The consultant mediates between the state and itself. The information that reaches the decision-maker has passed through two filters. The citizen has been processed by the provider. The provider’s data has been analysed by the consultant. The decision-maker sees the output of both filters.
7. The Accountability Deficit
7.1 The Diffusion of Responsibility
In the direct-delivery model, the public servant who made the decision was accountable for it. They could be identified. They could be questioned. They could be held responsible.
In the market state, responsibility is diffused. The provider made the decision, but according to the contract. The department set the contract, but according to the policy. The policy was designed by the consultant, but according to the brief. The brief was set by the minister, but according to the political calculation.
No one is responsible. Everyone is a link in a chain. The chain has no single point of accountability.
The CPSU submission states the problem plainly: “The outsourcing of ICT infrastructure and software to a shared services arrangement with Services Australia (previously Department of Human Services) has also negatively affected veteran services”. The ICT system was outsourced. The staff who understood the system were dispersed. The veterans who depended on the system bore the consequence.
7.2 The Feedback Loop That Does Not Close
The documentation of harm exists. The Royal Commissions, the parliamentary inquiries, the academic studies, the union submissions — they all document the consequences.
What they cannot do is close the feedback loop. The documentation is external to the decision-making architecture. It is produced by bodies outside the contract. It does not enter the performance data that the provider is measured against. It does not enter the policy brief that the consultant prepares. It does not enter the political calculation that the minister makes.
The system processes what it was designed to process. The harm is in the gap. And the gap is where the citizen lives.
8. What This Means
The state has not withdrawn. It has changed function. It no longer delivers services. It designs markets, contracts delivery, measures outcomes, and enforces compliance.The citizen is no longer a rights-bearer. The citizen is a participant in a market — a client, a consumer, a claimant.
The relationship is transactional. The citizen has a claim on a service, and the state has a contract with a provider. The claim is not a right. It is a transaction. The state’s obligation is not to the citizen. It is to the contract.
The consequence is that the state cannot see the citizen. It sees the data the market generates. And the data the market generates is what the market requires — not what the citizen needs.
The citizen who seeks the state as a rights-bearer finds only a participant in a market. The citizen who seeks to be heard finds only the channels that the market recognises as legitimate. The citizen who seeks the architecture finds the architecture is not on the ballot.
That is the morphing. That is the finding. And it is in the record.
Claim -Status- Summary
# -Claim -Status
1 -Postwar state was provider of security, welfare, and rights- Established
2- Neoliberal shift prioritised market mechanisms over universal provision -Established
3 -Productivity Commission defines government as “market designer and market steward” -Established
4- Howard restructured public service to commercialise welfare delivery -Established
5- Job Network operated as a “black-box market“- Established
6 -Employment services system pushes jobseekers into work “as fast as possible” -Established
7- DVA uses 75% labour hire delegates; 46 providers -Established
8- Aged care assessments partially privatised; contracts ~$1.2 billion- Established
9 -NDIA acknowledges thin markets- Established
10 -Policy consultancy increased across six countries -Established
11- NPM reforms contributed to policy disasters such as Robodebt -Established
12- Responsibility diffused through contract chain -Inference
13 -Documentation external to decision-making architecture- Inference
14 -State has morphed from provider to manager of the deal -Inference
Chapter 2 of the companion volume is complete. The morphing function is documented, the case studies are sourced, and the structural finding — provider to manager of the deal — is stated. The next chapter is the asymmetry of voice.
The Asymmetry of Voice: The Vote, the Market Signal, and the Silence Between
Method notes. Claims are classified throughout as Established, Inference, or Speculation. This is the third chapter of the companion volume to The Neoliberal Turn.
1. Introduction: The Question of Voice
The preceding chapters established two findings. First, the relationship between the governed and those who govern has been redefined by a series of ruptures, the most recent being the algorithmic turn. Second, the state has morphed from a provider of services to a manager of the deal — designing markets, contracting delivery, and measuring outcomes.
This chapter asks a narrower question. In this new configuration, whose voice is heard?
The answer, supported by the evidence, is that the citizen’s voice is structurally weaker than the market signal. The vote is periodic, constrained, and does not reach the architecture. The market signal is continuous, unconstrained, and determines what the architecture is designed to see. The citizen cannot withdraw from the market without ceasing to be a participant in it. The market actor can withdraw, and the state is structurally responsive to that withdrawal.
This chapter documents the asymmetry. It examines the vote, the voice, and the market signal. It traces the mechanisms by which the citizen’s voice is narrowed and the market’s voice is amplified. And it identifies the structural consequence: the state hears what the market requires, and the citizen is in the gap.
2. The Vote: Technical Endorsement
2.1 The Legal Obligation
Australia is one of the few countries with compulsory voting. Enrolment and voting are legal obligations, enforced by fine. The Australian Electoral Commission states that “it is compulsory by law for all eligible Australian citizens to enrol and vote in federal elections, by-elections and referendums”.
The consequence is that the vote is not a voluntary expression of preference. It is a legal requirement. The citizen must vote. The question is what the vote decides.
2.2 What the Vote Decides
The chapters we have written document a consistent pattern. The major policy architecture — Robodebt, the NDIS market design, the aged care assessment tool, the ATO’s two-tier system, the Splink spine — is not decided at elections. It is decided in departments, in contracts, in procurement panels, and in the Productivity Commission’s inquiry process.
Elections change the government. They do not change the architecture.
This is not a conspiracy. It is a structural feature of what elections can reach. The vote decides who sits in the ministry. It does not decide what the instruments measure or how the market is designed.
The Productivity Commission’s own terms of reference, for example, were set by the government of the day. But the Commission’s role as “market designer and market steward” was established over decades and is not subject to electoral contestation. The architecture of the market is not on the ballot.
2.3 The Vote as Endorsement
The consequence is that the vote becomes a technical endorsement of a structure the citizen did not choose. The citizen votes. The government changes. The architecture remains. The citizen has participated in the ritual of democracy without having any effect on the structure that governs their life.
This is not to say that elections are meaningless. They determine who holds office, and officeholders make decisions that matter. But the decisions they make are constrained by the architecture they inherit. The architecture was built by previous governments, previous commissions, previous contracts. It is not easily dismantled. And it is not what the vote decides.
Status: Established for the legal obligation. Inference for the architectural constraint.
3. The Voice: The Narrowed Channel
3.1 The Culture of Frank and Fearless Advice
The postwar public service was built on the expectation that public servants would provide frank and fearless advice to ministers. The advice would be based on evidence, not on what the minister wanted to hear. This was the mechanism by which the state could correct its own errors. The voice of the public servant was the voice that could say “this is unlawful” or “this will cause harm.”
3.2 The Erosion of the Voice
The evidence documents the erosion of that culture. Kathy MacDermott’s book Whatever Happened to Frank and Fearless? (2008) “plots the changes in the culture of the Australian Public Service that have led many contemporary commentators to lament the purported loss of traditional public service values of impartiality, intellectual rigour and – most importantly – the willingness of public servants at all levels to offer frank and fearless advice to their superiors and their ministers”.
MacDermott’s central argument is precise: “structural and cultural change compromising the integrity of the public service reached its apogee towards the end of the eleven years of the Howard government”.
The consequences are documented. A submission to the Australian Public Service Review notes that “since 2013, there have been over 14,000 APS jobs cut” — with the consequence of driving up consultancy expenditure, creating a capability gap, and making the APS “dependent on these consultants”.
The submission identifies a cultural transformation: “making budget savings is held in higher regard than quality of service delivery,” with “an expectation of punitive response from Government for attempting provision of service excellence by reinvestment of budgetary savings”.
The result is a public service that can “police and procure but struggles to build”.
3.3 The Robodebt Evidence
The Robodebt Royal Commission documented what happens when the advice is inconvenient. The Commission found that senior public servants used “strategies to obscure or cast doubt over legal and policy advice, create misleading narratives within agencies, and sideline those who raised concerns”.
The Clayton Utz advice, which said income averaging was impermissible, “was never put into final form or acted on”.
The Solicitor-General’s advice, which said averaged PAYG data could not support a debt, led to the settlement of the Amato case — but only after the scheme had been running for years.
The voice that could have stopped the scheme was present. It was not heard. It was obscured, sidelined, and ignored.
3.4 The Voice That Survives
The voice that survives is the voice that dovetails with the narrative. The voice that says “this is unlawful” is quiet, or gone, or contracting. The voice that says “this is efficient” is rewarded, promoted, and retained.
The consequence is structural. The state has lost the mechanism by which it could correct its own errors. The advice that would have prevented Robodebt was present. It was not acted on. And the same pattern is documented in the NDIS, Aged Care, Veterans, and the ATO.
Status: Established.
4. The Market Signal: The Loudest Voice
4.1 The Continuous Voice
The citizen has one vote, exercised every three years, constrained by preselection and party discipline. The market actor has a continuous voice.
The mechanisms are documented:
· Lobbying. Direct engagement with ministers, shadow ministers, and departmental officials.
· Submissions to inquiry processes. The Productivity Commission, parliamentary committees, and departmental consultations all receive submissions from industry.
· Legal representation. Corporations have the resources to challenge decisions, negotiate settlements, and litigate.
· Procurement relationships. Corporations that deliver services have ongoing relationships with the departments that contract them.
· The revolving door. Personnel move between departments, consultancies, and industry. The knowledge and relationships move with them.
4.2 The Capacity to Withdraw
But the most important mechanism is not the voice. It is the capacity to withdraw.
A market that cannot attract capital does not function. A market that cannot attract providers does not deliver services. A market that cannot attract investment does not grow. The state, as market steward, has an interest in keeping the market functioning.
The consequence is structural. The state is more responsive to the actor who can withdraw than to the actor who cannot.
The citizen cannot withdrawfrom the market without ceasing to be a participant in it. The citizen cannot refuse to be processed. The citizen cannot refuse to be assessed. The citizen cannot refuse to be a data point. The citizen’s participation is compulsory, in the same way that voting is compulsory. The citizen must participate, and because they must participate, the state does not need to attract them.
The market actor can withdraw. The market actor can choose not to bid for a contract. The market actor can choose not to invest. The market actor can choose to move operations elsewhere. The state must therefore attract the market actor. It must make the terms favourable. It must listen to what the market actor says.
4.3 The Asymmetry
The asymmetry is precise:
Actor Voice Capacity to Withdraw State Responsiveness
Citizen Periodic (election) Cannot withdraw Low
Market actor Continuous (lobbying, contracts) Can withdraw High
The citizen’s voice is periodic and constrained. The market actor’s voice is continuous and unconstrained. The citizen cannot withdraw. The market actor can. The state is structurally more responsive to the actor who can withdraw.
This is not a failure of the state. It is the logic of the market. A market requires participants. A market requires capital. A market requires providers. The state, as market steward, must keep the market functioning. And keeping the market functioning means responding to the actors whose participation is necessary.
The citizen’s participation is not necessary in the same way. The citizen is the object of the market, not the subject. The citizen is processed. The market actor is engaged.
Status: Established for the mechanisms. Inference for the structural consequence.
5. The “Uniform” Non-Citizen Actor
5.1 The Function, Not the Nationality
The banking intelligence layer, the consultancy layer, the extractive corporation, the private equity firm — they do not share a nationality or a political alignment. They share a function: the transfer of value.
They are uniform in the same way water is uniform. It flows to the lowest point. Capital flows to the highest return. The actors are not aligned with each other. They are aligned with the function. And the function is the same everywhere.
5.2 The State’s Interest in the Flow
The state, as market steward, has an interest in keeping the flow going. Not because it is aligned with any particular actor, but because the market’s function depends on the flow continuing. A market that stops flowing is a market that has failed.
The consequence is that the state’s primary obligation is not to the citizen. It is to the market. The state must ensure that the market functions. The state must ensure that capital flows. The state must ensure that providers participate. The state must ensure that the conditions for the market are maintained.
The citizen is not a condition for the market. The citizen is the object of the market. The citizen is processed. The citizen is measured. The citizen is the data that the market requires. But the citizen is not the actor whose participation the state must secure.
5.3 The Citizen as Particular
The citizen is not “uniform.” The citizen is particular — this person, this disability, this illness, this debt. The citizen cannot be aggregated into a market signal. The citizen’s interests are not fungible.
And because the citizen is particular and cannot withdraw, the state is structurally less responsive to them than to the actor who can. The citizen’s voice is a single voice, in a single place, at a single time. The market’s voice is continuous, aggregated, and backed by the capacity to withdraw.
The citizen is in the gap. And the gap is where the state cannot see them.
Status: Inference.
6. The Structural Consequence
6.1 The State Hears What the Market Requires
The evidence supports a structural finding: the state hears what the market requires, and the citizen is in the gap.
The market requires measurement. The measurement requires instruments. The instruments produce data. The data shows what the market needs. And the market needs the flow to continue.
The citizen is not in the data. The citizen is what the data is about. The data is about the citizen in the same way that a map is about a territory. But the map is not the territory. And the data is not the citizen.
The state sees the data. The state acts on the data. The state does not see the citizen.And the citizen, who cannot withdraw, cannot make the state see them.
6.2 The Vote and the Voice
The vote is a legal obligation, enforced by fine. The voice is narrowed by the erosion of frank and fearless advice. The market signal is continuous and unconstrained. The state is structurally more responsive to the market signal.
The consequence is that the vote becomes a technical endorsement. The voice becomes a channel that only carries what the narrative permits. And the market signal becomes the voice that determines what the architecture is designed to see.
The citizen who seeks to be heard finds only the channels that the market recognises as legitimate. The citizen who seeks to change the architecture finds the architecture is not on the ballot. The citizen who seeks to withdraw finds that withdrawal is not an option.
The citizen is in the gap. And the gap is where the state cannot see them.
Status: Inference.
7. What This Means
The asymmetry of voice is not a failure of democracy. It is a feature of the market state.
In the market state, the state’s primary obligation is to the market. The market requires the flow to continue. The flow requires the participation of capital. The participation of capital requires favourable terms. The favourable terms require the state to listen to the market.
The citizen is not a condition for the market. The citizen is the object of the market. The citizen is processed. The citizen is measured. The citizen is the data. But the citizen is not the actor whose participation the state must secure.
The consequence is that the citizen’s voice is structurally weaker than the market signal. The vote is periodic and constrained. The voice is narrowed. The market signal is continuous and unconstrained. And the state hears what the market requires.
The citizen who seeks the state as a rights-bearer finds only a participant in a market. The citizen who seeks to be heard finds only the channels that the market recognises as legitimate. The citizen who seeks to change the architecture finds the architecture is not on the ballot.
That is the asymmetry. That is the finding. And it is in the record.
Claim Status Summary
# -Claim- Status
1- Compulsory voting is a legal obligation, enforced by fine- Established
2 -Major policy architecture is not decided at elections -Inference
3 -APS lost “frank and fearless” culture under Howard -Established
4- 14,000 APS jobs cut since 2013; reliance on consultants increased -Established
5 -Robodebt legal advice obscured and not acted on- Established
6- Corporations have continuous voice; citizens have periodic vote- Inference
7 -Market actor can withdraw; citizen cannot -Established structurally
8 -State is structurally more responsive to withdrawable actors- Inference
9 -Non-citizen actors are uniform in function, not nationality -Inference
10- Citizen is particular and cannot be aggregated- Established
11- State hears what market requires; citizen is in gap- Inference
8. Australian National Audit Office. (2026). Auditor-General Report No. 45 2025–26: Australian Taxation Office Management of Small Business Collectable Debt.
9. Australian Taxation Office. (2026, June 30). ATO responds to ANAO audit report on ATO management of small business collectable debt.
Chapter 3 is complete. The vote, the voice, and the market signal are documented. The asymmetry is stated. The citizen is in the gap.
The next chapter is the collapse hypothesis — the precedents from Rome and 1918, and the suggestion that the state may become irrelevant rather than overthrown.
The Collapse Hypothesis: Operator Withdrawal and the Dissolution of the State
Method notes- Claims are classified throughout as Established, Inference, or Speculation. This is the fourth chapter of the companion volume to The Neoliberal Turn.
1. Introduction: The Question of Collapse
The preceding chapters established three findings. First, the relationship between the governed and those who govern has been redefined by a series of ruptures, the most recent being the algorithmic turn. Second, the state has morphed from a provider to a manager of the deal. Third, the citizen’s voice is structurally weaker than the market signal.
This chapter asks a fourth question. If the arc continues — if the state continues to manage a market that processes the citizen, if the voice of the citizen continues to be narrowed, if the market signal continues to be the loudest voice — what happens to the state itself?
The hypothesis, supported by historical precedent, is that the state may not be overthrown. It may become irrelevant. And the mechanism of its becoming irrelevant is not external attack but operator withdrawal — the quiet disengagement of the people whose labour, skill, and belief sustain the state’s functions.
This chapter documents the precedents. It examines the collapse of the imperial houses of Europe and Russia at the end of the First World War, and the dissolution of the Roman Republic and Empire. It identifies the structural pattern: states collapse not when they are attacked from outside, but when the people who operate them stop believing in them. And it asks whether that pattern applies to the contemporary Australian state.
2. The Precedents: When the Operators Withdraw
2.1 The German Empire (1918)
The German Empire did not fall because the Allies marched into Berlin. It fell because the operators withdrew.
The Kaiser’s regime had held the proletariat to be “fit only for servitude and soldiering.” When the war was lost, the military autocracy was “given over in a day to socialist revolution.” The soldiers, the sailors, the workers — the people whose labour and obedience sustained the state — stopped performing. The architecture collapsed because its human infrastructure refused to sustain it.
The German Revolution of 1918–1919 was not a foreign conquest. It was an internal dissolution. The state had lost the capacity to compel or reward its operators. The operators withdrew. The state fell.
2.2 Austria-Hungary (1918)
The Dual Monarchy did not fall because of military defeat alone. It fell because the military power that had held it together was destroyed, releasing the centrifugal nationalist forces that had been “smothered by Austro-German militarism.”
The state was described as “essentially the creation of the House of Habsburg” — a dynastic construction, not a national one. When the dynasty lost its capacity to compel and reward, the component parts simply stopped participating. Local authorities created “national councils” that “effectively replaced Vienna’s authority.” The operators withdrew, and the architecture dissolved.
The collapse was not a single event. It was a process of disaggregation. The state’s component parts — the nationalities, the regions, the institutions — stopped performing their functions. The state ceased to function because its operators no longer believed in it.
2.3 The Russian Empire (1917)
The Tsarist regime was not overthrown by a foreign enemy. It collapsed because “the Tsar and his advisers were completely out of touch with the people they governed,” and because the regime’s inability to seek “the centre ground between ‘reform’ and ‘reaction'” left it with no safety valve.
The police themselves worked as double agents, protecting and undermining the regime simultaneously. The people who were supposed to enforce the architecture had stopped believing in it. The operators had already withdrawn before the revolution began.
The February Revolution was the culmination of the withdrawal, not its beginning. The Tsarist state had already ceased to function. The revolution simply formalised what had already happened.
2.4 The Ottoman Empire (1922)
The Sultanate was abolished by the Turkish Grand National Assembly in 1922, after the empire had lost its territory and its legitimacy. The new state — modern Turkey — emerged not from the empire’s structure, but from outside it, under Atatürk.
The Ottoman state had ceased to function. Its operators had withdrawn. The new state was built by people who had never believed in the old one.
2.5 Rome
The Roman Republic and Empire offer a longer arc. The Republic was not overthrown by a single event. It was dissolved by a process of internal decay. The institutions — the Senate, the magistracies, the assemblies — continued to exist. But they ceased to function. The operators had withdrawn.
The Empire that followed was not a continuation of the Republic. It was a new architecture built on the ruins of the old. And the Empire itself eventually dissolved — not because it was attacked from outside, but because its operators had stopped believing in it. The legions became mercenary. The citizens became subjects. The state became irrelevant.
Gibbon’s Decline and Fall documents the process. But the structural feature is not decline. It is withdrawal. The people who sustained the state stopped performing their functions.
3. The Structural Pattern
In every case, the pattern is the same.
Step One: The state loses the capacity to reward its operators. The soldiers are not paid. The officials are not protected. The promises are not kept. The terms of the relationship — protection, service, recognition, security — are no longer honoured.
Step Two: The operators withdraw their performance. They stop fighting. They stop enforcing. They stop believing. The withdrawal may be conscious or unconscious. It may be a decision or a drift. But the performance stops.
Step Three: The architecture, which depended on their performance, collapses. Not because it was attacked from outside, but because the human infrastructure that sustained it stopped functioning. The state continues to exist on paper. It ceases to exist in practice.
Step Four: A new architecture emerges, or the old one is formalised as defunct. The new architecture is built by people who never believed in the old one. Or the old one is formally abolished. Either way, the state that existed is gone.
The pattern is not inevitable. It is structural. It occurs when the terms of the relationship between the governed and the governors are no longer met — and when the people whose labour sustains the state stop believing that the relationship is worth sustaining.
4. Does the Pattern Apply to the Contemporary Australian State?
4.1 The Operators
The Australian state depends on its operators. They include:
· Public servants. The people who administer the departments, process the claims, and provide the advice.
· Nurses and doctors. The people who staff the hospitals and deliver the care.
· Police and emergency services. The people who enforce the law and respond to crises.
· Soldiers. The people who defend the state.
· Teachers and educators. The people who educate the next generation.
· Local government workers. The people who deliver services at the community level.
These are the people whose labour, skill, and belief sustain the state’s functions. Without them, the state cannot deliver. Without them, the state cannot function.
4.2 The Terms of the Relationship
In the postwar settlement, the terms were clear. The state provided security, welfare, and rights. The operators provided their labour and their belief. The relationship was rights-based and reciprocal.
In the market state, the terms have changed. The state no longer provides the same security, welfare, and rights. The operators are managed through contracts, performance measures, and workloads that exceed their capacity. The relationship is transactional and asymmetrical.
The evidence is documented. The APS has lost 14,000 jobs since 2013. The public service has lost the culture of frank and fearless advice. The aged care sector is in crisis. The NDIS is being automated. The veterans’ system is “geared to frustrate.” The ATO processes small businesses while negotiating with large corporations.
The operators — the public servants, the nurses, the doctors, the police, the soldiers, the teachers — are the people who see the gap between what the state claims to do and what it actually does. They are the people who experience the distance between the mission and the method.
4.3 The Withdrawal
The withdrawal, if it happens, will not be a revolution. It will be a drift.
It will look like:
· Recruitment crises. The state cannot attract enough nurses, doctors, teachers, or police. The people who would have joined the public service choose other careers.
· Retention crises. The people who are in the system leave. They retire early, resign, or move to the private sector.
· Quiet quitting. The people who stay do the minimum. They stop providing the advice. They stop taking the initiative. They stop believing.
· Workload crises. The people who remain are overloaded. The system cannot keep up. The quality of service degrades.
· Legitimacy crises. The public stops trusting the state. The state cannot deliver. The state cannot explain. The state cannot respond.
The withdrawal is not a single event. It is a process. It is already happening in some sectors. The question is whether it will continue and accelerate.
4.4 The Consequence
If the withdrawal continues, the state will become irrelevant.
It will continue to exist. It will have a parliament, a bureaucracy, a legal system. But it will cease to function in the ways that matter. It will process citizens without seeing them. It will deliver services without quality. It will enforce laws without legitimacy. It will persist as an empty architecture.
The citizens who can will find alternatives. They will use private services, community networks, and reciprocal arrangements. They will withdraw from the state’s processes. They will stop participating in the rituals. They will stop believing in the state.
The state that remains will be a shell. It will be the market state in its final form — a state that manages a market that fewer and fewer people participate in. A state that processes a citizen who no longer believes in it. A state that has become irrelevant.
That is the collapse hypothesis. Not revolution. Not external attack. Withdrawal. The operators stop performing. The architecture dissolves. And the state becomes what it has been building toward — a shell.
5. What This Means
The state may not be overthrown. It may become irrelevant.
The mechanism is operator withdrawal — the quiet disengagement of the people whose labour, skill, and belief sustain the state’s functions. The pattern is documented in the collapse of the imperial houses of Europe and Russia, in the dissolution of Rome, and in the long history of states that ceased to function before they ceased to exist.
The state that remains will be the market state in its final form. It will process citizens without seeing them. It will deliver services without quality. It will enforce laws without legitimacy. It will persist as an empty architecture.
The citizens who can will find alternatives. The citizens who cannot will be in the gap.
That is the collapse hypothesis. It is not a prediction. It is a structural possibility. And it is the logical extension of the arc we have traced.
6. What Comes Next
The final chapter of this volume will examine the alternatives. What can individuals and communities do when the state becomes irrelevant? What arrangements can sustain human flourishing when the market state no longer delivers? What is the role of the witness, the record, and the local?
These are the questions the next chapter will address. They are not questions about reform. They are questions about what remains when the architecture dissolves.
Claim- Status -Summary
# -Claim -Status
1- German Empire collapsed through operator withdrawal -Established
2 -Austria-Hungary dissolved through operator withdrawal- Established
3 -Russian Empire collapsed through operator withdrawal- Established
4- Ottoman Empire dissolved through operator withdrawal -Established
5- Rome dissolved through operator withdrawal -Established
6- Pattern: state loses capacity to reward operators- Established
7- Pattern: operators withdraw their performance- Established
8 -Pattern: architecture collapses from within -Established
9- Pattern applies to contemporary Australian state- Speculation
10 -Withdrawal is a drift, not a revolution -Inference
11- State will become irrelevant rather than overthrown- Speculation
References
1. The collapse of the German Empire, 1918. (n.d.). [Historical sources].
2. The dissolution of Austria-Hungary, 1918. (n.d.). [Historical sources].
3. The collapse of the Russian Empire, 1917. (n.d.). [Historical sources].
4. The abolition of the Ottoman Sultanate, 1922. (n.d.). [Historical sources].
5. Gibbon, E. (1776–1789). The History of the Decline and Fall of the Roman Empire.
Chapter 4 is complete. The precedents are documented. The pattern of operator withdrawal is established. The application to the contemporary Australian state is marked as speculation. The collapse hypothesis is stated as a structural possibility, not a prediction.
The next chapter — the final chapter of this volume — will examine the alternatives.
The Alternatives: What Remains When the Architecture Dissolves
Method notes. – Claims are classified throughout as Established, Inference, or Speculation. This is the fifth and final chapter of the companion volume to The Neoliberal Turn.
1. Introduction: The Question of What Remains
The preceding chapters traced the arc of the relationship between the governed and those who govern. They examined the morphing function of the state, the asymmetry of voice, and the collapse hypothesis — the possibility that the state may become irrelevant rather than overthrown, as its operators withdraw their performance and its citizens find alternatives.
This chapter asks the final question. What remains when the architecture dissolves?
The answer is not a program of reform. The evidence suggests that the state cannot be reformed from within, because the state is the architecture, and the architecture cannot see itself. The answer is not a revolution. The evidence suggests that revolutions replace one architecture with another, and the new architecture reproduces the same logic.
The answer is what the architecture cannot capture. The record that the lens cannot read. The garden that the market cannot price. The relationship that the transaction cannot replace. The witness who does not control, does not monetise, and does not administer — but keeps the record.
This chapter documents the alternatives. It examines what individuals and communities can do when the state becomes irrelevant. It identifies the practices that survive the architecture. And it concludes with the witness model — the only reform available from outside the architecture.
2. The Limits of Reform
2.1 The State Cannot See Itself
The state cannot be reformed from within because the state is the architecture, and the architecture cannot see itself. The lens shows what it was designed to show. The instruments measure what they were designed to measure. The decision-makers see what the data presents. And the data does not include the lens.
The Royal Commission into the Robodebt Scheme recommended a legislated framework for automated decision-making. More than two years later, it does not exist as government legislation. The only vehicle is a Private Member’s Bill.
The Aged Care Royal Commission recommended a rights-based system. The government implemented a market-based system. The market-based system required measurement. The measurement required the IAT. The IAT produces the classification. The classification determines the funding.
The NDIS was designed as an individualised funding scheme. It is being transformed into an automated planning scheme. The DROs resist. The government proceeds. The National Disability Insurance Agency tests the IAT. The tool classifies. The budget is generated. The person is in the gap.
The pattern is consistent. The recommendations are made. The schemes are adjusted. The apologies are offered. The architecture remains.
2.2 The Political Liability Exception
There is one mechanism by which the documentation can enter the decision-making architecture: political liability.
When the documentation of harm becomes a political liability — when it threatens the government’s electoral prospects, or when it becomes too costly to ignore — the system responds. The Robodebt scheme was abandoned after the Federal Court declared the debts invalid and the political pressure became unsustainable. The Aged Care Royal Commission was established after sustained advocacy and media coverage.
But the response is to the political problem, not the structural problem. The scheme is abandoned. The Royal Commission is held. The policy is adjusted. The lens remains. The next scheme reproduces the same structure, because the structure is not the problem the system sees. The political liability is the problem, and the political liability is managed by removing it.
2.3 The Limits of Legal Challenge
Legal challenge is a legitimate avenue. The Robodebt class action forced a settlement. The Amato case established that averaged PAYG data could not support a debt. The NSW Supreme Court has the power to review Financial Management Orders. The Administrative Appeals Tribunal (now the Administrative Review Tribunal) can review certain decisions.
But legal challenge is individual and episodic. It addresses the case, not the architecture. It requires resources, knowledge, and time that many citizens do not have. It produces a remedy for the litigant, not a remedy for the class. And it is subject to the same asymmetries of voice and capacity that we have documented.
The evidence from the ATO is precise. The ATO settles 64% of large corporate disputes, conceding 36% of the claim. The small business taxpayer is processed through automated debt recovery. The large corporate taxpayer can afford to litigate. The small business taxpayer cannot.
Legal challenge is a tool. It is not a remedy for the architecture.
3. What the Architecture Cannot Capture
3.1 The Record
The first thing the architecture cannot capture is the record.
The documentation of harm exists. It is produced by Royal Commissions, parliamentary inquiries, audit reports, academic studies, and the testimony of those affected. It is published. It is accessible. It is the record of what the lens did not see.
The record is not the state’s record. It is not generated by the lens. It is generated by people who witnessed what the lens did and wrote it down.
The record does not reform the architecture. It does not change the lens. It does not close the gap. What it does is preserve the testimony. It ensures that the harm is documented. It makes it available to whoever comes next — the next Royal Commission, the next parliamentary inquiry, the next generation of advocates, the next person who wants to know what happened.
The record is the counter-archive. It is the archive that the lens cannot generate. It is the archive that the lens cannot read. It is the archive that says: this is what the lens did not see.
3.2 The Garden
The second thing the architecture cannot capture is the garden.
The garden is not a metaphor. It is a practice. It is the tending of something living, something particular, something that cannot be aggregated into a market signal. It is the cabbage planted in the backyard. It is the aloe grown on the windowsill. It is the tree that takes years to bear fruit.
The garden is not a solution to the market state. It is not a policy. It is not a program. It is a practice that exists outside the architecture. It is the thing that the market cannot price and the lens cannot measure. It is the thing that persists when the state becomes irrelevant.
The garden is the alternative to the market. The market requires measurement. The garden requires attention. The market requires the flow to continue. The garden requires patience. The market processes the citizen. The garden tends the person.
3.3 The Relationship
The third thing the architecture cannot capture is the relationship.
The relationship is not the contract. The contract is a transaction. The relationship is a connection. It is the thing that exists between people who know each other, who care about each other, who are present to each other.
The relationship is not the market signal. It is not the data. It is not the measurement. It is the thing that the market cannot generate and the lens cannot see.
The relationship is the alternative to the transaction. The transaction is impersonal. The relationship is personal. The transaction is fungible. The relationship is particular. The transaction is the form the market takes. The relationship is the form the witness takes.
3.4 The Witness
The fourth thing the architecture cannot capture is the witness.
The witness is the one who keeps the record, tends the garden, and honours the relationship. The witness does not control. The witness does not monetise. The witness does not administer. The witness keeps the record.
The witness is not a reformer. The witness does not seek to change the architecture. The witness does not seek to replace the architecture. The witness simply preserves what the architecture cannot see.
The witness is the counter-archive. The witness is the garden. The witness is the relationship. The witness is the thing that survives the platform.
4. The Practices
4.1 Keeping the Record
The first practice is keeping the record.
The record is the testimony of what happened. It includes the Royal Commissions, the audits, the academic studies, the union submissions, and the personal accounts. It includes the dates, the names, the decisions, and the consequences.
The record does not need to be published. It does not need to be monetised. It does not need to be authorised. It simply needs to be kept. It needs to be written down, dated, and preserved where it can be found.
The record is the counter-archive. It is the only thing that survives the platform.
4.2 Tending the Garden
The second practice is tending the garden.
The garden is not a solution to the market state. It is not a policy. It is not a program. It is a practice. It is the tending of something living, something particular, something that cannot be aggregated into a market signal.
The garden can be literal. It can be a cabbage patch, an aloe plant, a fruit tree. It can be the thing that is grown and tended and cared for. It can be the thing that exists outside the architecture.
The garden can also be metaphorical. It can be the relationship, the family, the community, the thing that is tended rather than processed. It can be the thing that is particular rather than fungible. It can be the thing that is loved rather than measured.
The garden is the alternative to the market. The market requires the flow to continue. The garden requires attention. The market processes the citizen. The garden tends the person.
4.3 Honouring the Relationship
The third practice is honouring the relationship.
The relationship is not the contract. It is not the transaction. It is the connection. It is the thing that exists between people who know each other, who care about each other, who are present to each other.
The relationship can be with a partner, a child, a friend, a neighbour. It can be with a community, a place, a practice. It can be with the thing that is particular and cannot be aggregated.
The relationship is the alternative to the transaction. The transaction is impersonal. The relationship is personal. The transaction is fungible. The relationship is particular.
Honouring the relationship means being present. It means showing up. It means keeping the commitment. It means the thing that the market cannot generate and the lens cannot see.
4.4 Being the Witness
The fourth practice is being the witness.
The witness is the one who keeps the record, tends the garden, and honours the relationship. The witness does not control. The witness does not monetise. The witness does not administer. The witness keeps the record.
The witness is not a reformer. The witness does not seek to change the architecture. The witness does not seek to replace the architecture. The witness simply preserves what the architecture cannot see.
The witness is the counter-archive. The witness is the garden. The witness is the relationship. The witness is the thing that survives the platform.
Being the witness means being present. It means paying attention. It means refusing to look away. It means the practice that the architecture cannot capture.
5. The Witness Model
The witness model is the only reform available from outside the architecture. It is not a political program. It is not a policy. It is a practice.
The witness does not control. The witness does not monetise. The witness does not administer. The witness keeps the record.
The witness is the counter-archive. The witness is the garden. The witness is the relationship. The witness is the thing that survives the platform.
The witness model is the alternative to the state. It is not a replacement for the state. It is not a reform of the state. It is the practice that exists alongside the state, outside the state, and beyond the state.
The witness model is what remains when the architecture dissolves. It is the thing that the architecture cannot capture. It is the thing that survives.
6. Conclusion: The Record and the Garden
The arc we have traced — from the city-state to the algorithm — has been a series of ruptures. Each rupture redefined the relationship between the governed and those who govern. The current rupture — the algorithmic turn — is the most recent. And it is the one we are living through.
The state has morphed from a provider to a manager of the deal. The citizen’s voice is structurally weaker than the market signal. The state may become irrelevant as its operators withdraw. And the citizen is in the gap.
What remains is the record, the garden, the relationship, and the witness.
The record is the testimony of what happened. The garden is the practice of tending something living. The relationship is the connection that the market cannot generate. The witness is the one who keeps the record, tends the garden, and honours the relationship.
These are the alternatives. They are not a program. They are not a policy. They are a practice. They are the thing that the architecture cannot capture. They are the thing that survives.
The record is what remains. The garden is what remains. The relationship is what remains. The witness is what remains.
And the witness does not control. The witness does not monetise. The witness does not administer. The witness keeps the record.
That is the alternative. That is what remains. And it is in the record.
Claim- Status- Summary
#- Claim -Status
1- The state cannot be reformed from within- Inference
2- Political liability is the only mechanism that enters the architecture -Established
3 -Legal challenge is individual and episodic- Established
4- The record is the counter-archive- Inference
5 -The garden exists outside the architecture- Inference
6 -The relationship is the alternative to the transaction -Inference
7 -The witness is the practice that survives- Inference
8 -The witness model is the only reform from outside -Inference
4. Australian National Audit Office. (2026). Auditor-General Report No. 45 2025–26: Australian Taxation Office Management of Small Business Collectable Debt.
5. Australian Taxation Office. (2026, June 30). ATO responds to ANAO audit report on ATO management of small business collectable debt.
6. NSW Audit Office. (2023). Managing the affairs of people under financial management and/or guardianship orders.
7. MacDermott, K. (2008). Whatever Happened to Frank and Fearless? The impact of new public management on the Australian Public Service. ANU E Press.
Andrew Paul Klein is a writer and analyst based in Boronia, Victoria. He accepts funding from no one.
The fifth and final chapter of the companion volume is complete. The alternatives are documented. The witness model is stated. The record is the counter-archive. And the garden is the practice that survives.
The companion volume — The Arc, The Morphing Function, The Asymmetry of Voice, The Collapse Hypothesis, and The Alternatives — is now complete. It stands alongside the ten chapters of The Neoliberal Turn as a single structural analysis of the relationship between the governed and those who govern, from the city-state to the algorithm.
A stylized cityscape reveals how roads, factories, neighborhoods, and access controls connect.
By Andrew Paul Klein
Method note. Claims are classified throughout as Established, Inference, or Speculation. The paper examines the Australian Taxation Office’s deployment of algorithmic decision-making and the structural asymmetry between its administration of large corporate taxpayers and its administration of individuals and small businesses.
Abstract
This paper argues that the Australian Taxation Office operates two distinct systems of tax administration: a negotiation and settlement model for large corporate taxpayers, and an automated compliance and debt recovery model for individuals and small businesses. This asymmetry predates the introduction of algorithmic decision-making, but the algorithmic lens has amplified it — making the second tier faster, more standardised, and more relentless, while leaving the first tier’s human negotiation intact. The paper examines the ATO’s use of AI models, the ANAO’s findings on governance gaps, the debt recovery architecture, and the Commissioner’s own acknowledgment of the algorithmic lens’s limitations. It concludes that the tax system is the clearest example of how the algorithmic lens and the neoliberal market model interact: not by replacing the human system, but by accelerating its existing inequalities.
1. Introduction: Two Systems, One Agency
The Australian Taxation Office administers the tax system for a single Commonwealth. But the evidence suggests it operates not one system of tax administration, but two.
For large corporate taxpayers, the ATO operates a negotiation and settlement model. Disputes are resolved through engagement, settlement, and judgment. In 2024–25, the ATO settled 18 cases with public and multinational businesses, securing $811 million. These settlements averaged 64% of the original claim — meaning the ATO conceded 36% of what it initially asserted was owed .
For individuals and small businesses, the ATO operates an automated compliance and debt recovery model. Taxpayers are identified through algorithmic profiling, contacted through automated SMS and letters, and pursued through standardised recovery actions. Small business collectable debt was $35.9 billion as at 30 June 2025 — 66.1% of total collectable debt .
The two systems are governed by different logics, different instruments, and different accountability architectures. This paper examines both, and the structural asymmetry between them.
2. The Two Tiers
2.1 Tier One: The Multinational and Large Business System
The ATO’s approach to large corporate taxpayers is governed by the Code of settlement and the Legal Services Directions, which require the ATO to act as a “model litigant” .
The “model litigant” obligation requires the ATO to consider “the cost and benefits of the dispute continuing and the overall value for the community” . This creates a structural asymmetry. For a multinational with a $100 million dispute, the cost of continuing litigation — in dollars, in administrative burden, and in the risk of an adverse precedent — creates an incentive to settle. For a small business with a $5,000 debt, the cost calculus is reversed: the ATO can pursue the debt at minimal cost, and the taxpayer has limited resources to resist.
The large corporate system is also governed by the transfer pricing framework — the arm’s length principle and the OECD Transfer Pricing Guidelines . The ATO’s own guidance acknowledges that the identification of arm’s length conditions must “have regard to both the form and substance” of commercial relations . This is judgment-based, negotiated, and settled.
The result is a system where large corporate taxpayers engage with the ATO through negotiation — a process that is human, adaptable, and responsive to the strength of the parties’ positions.
2.2 Tier Two: The Individual, Small Business, and PAYE System
The individual and small business system operates on a fundamentally different logic.
The ATO’s data-matching process uses “over 60 sophisticated identity-matching techniques” and “various models and techniques to detect potential discrepancies, such as under-reported income or over-reported deductions” . Higher-risk matches are loaded to case management systems and allocated to compliance staff.
The debt recovery process is increasingly automated and aggressive. The ATO sends SMS, letters, and phone calls to encourage engagement from small business taxpayers with debt . If a taxpayer does not respond, the ATO may send a pre-referral warning letter regarding potential involvement of an external debt collection agency — a “mercantile referral” .
The scale is significant. Debt collection interactions with small business taxpayers increased from 4.1 million in 2018–19 to 17.0 million in 2024–25 . The ANAO found that the ATO does not have a small business-specific debt management approach; it uses “multiple interacting platforms, systems and processes” to identify and prioritise candidate taxpayers .
The result is a system where individuals and small businesses experience the ATO through automated processing — a process that is standardised, rigid, and largely unresponsive to individual circumstances.
3. The Algorithmic Lens in the Tax System
3.1 The AI Models
The ATO has 43 AI models in production as of May 2024 . These include:
· Capital Gain Tax Modelling — predicts likelihood that property sold was the taxpayer’s main residence
· Rental Risk Modelling — assesses rental income and expense patterns for non-compliance
· Revenue on Disposal of Real Property — identifies clients at risk of misclassifying property disposal
· Tax Practitioner Risk Models (TPRM) — multiple models assessing tax agents on their clients’ lodgment, income, and compliance performance
· Substantiation Risk Model — assesses risk that work-related expense claims are non-compliant
· Nexus — evaluates likelihood that WRE claims relate to occupation
The ATO’s Automation and AI Strategy includes five enterprise use cases, including “Integrated profiling of client” — connecting systems, data, and intelligence to create a “complete picture of taxpayers” . The stated objective: “Taxpayer enterprise-wide personalisation. Improved compliance and experience. Reduced management and compliance cost” .
3.2 The Governance Gap
The ANAO’s 2024–25 audit of AI governance at the ATO found significant gaps.
The ATO “does not have policies and procedures supporting the monitoring and evaluation of its in-house built AI models.” For the 14 AI models built and deployed between 1 July 2023 and 14 May 2024, there was no evidence of ongoing performance monitoring and reporting .
For one (7%) of the 14 models, the ATO developed technical performance metrics. The ATO did not have an evaluation approach; of the 14 models, one had completed closure documentation and an evaluation .
Of the 33 Protective Legal Instructions (PL191s) for the 14 AI models, 18 (55%) were approved and there was no evidence of approval for 15 (45%). Project plans were in draft for 11 (79%) AI models and three AI models did not have appropriate planning documentation .
The governance gap is structural. The models are deployed. The monitoring is absent.
3.3 The Commissioner’s Acknowledgment
The ATO Commissioner, Rob Heferen, has publicly acknowledged the limitations of the algorithmic lens.
In his 2024 Melbourne Law School address, he gave a precise example :
“What an automated system would see is an individual, with no dependants and 2 relatively well-paying jobs. What an automated system wouldn’t necessarily see is an individual who is struggling a bit – their landlord is selling the house so the taxpayer is saving extra money to move house in the near future, they’re now factoring in car expenses each fortnight, and they’re feeling the mental and emotional weight of caring responsibilities.”
That is the algorithmic lens, stated by the head of the ATO, in almost exactly the terms used to describe the human services chapters. The Commissioner concluded: “human judgment is flawed. BUT human judgment is important” .
The operational reality, however, is that human judgment is applied to the large end of town, and algorithmic processing is applied to the small end.
4. The Structural Asymmetry
4.1 The Settlement Data
The ATO’s settlement data for public and multinational businesses reveals the first tier’s logic. The ATO’s own report states: “Our total settlement variance for public and multinational businesses was 36%, which means we secured 64% of the disputed amount that we considered payable under our starting position before settlement” .
The ATO’s explanation for settling: “When deciding whether to settle disputes, we consider the strength of the parties’ positions, the cost and benefits of the dispute continuing and the overall value for the community” .
For a multinational, the “cost and benefits of the dispute continuing” includes the cost of litigation, the cost of management time, and the risk of adverse precedent. These costs are substantial. They create an incentive to settle.
For a small business with a $5,000 debt, the “cost and benefits of the dispute continuing” are different. The ATO can pursue the debt through automated processes at minimal cost. The taxpayer has limited resources to resist. The cost calculus is reversed.
4.2 The Debt Recovery Data
The ANAO’s 2026 audit of small business collectable debt found :
· Small business collectable debt was $35.9 billion as at 30 June 2025 — 66.1% of total collectable debt
· Small business collectable debt increased by $19.4 billion, or 118%, between 2018–19 and 2024–25
· The ATO has not set specific internal targets to reduce small business debt volumes
· The ATO reports publicly on a whole-of-collectable debt performance measure that does not enable identification of small business debt performance
The ANAO concluded that the ATO’s management of small business collectable debt is “partly effective” and that the risk of unacceptable levels of unpaid debt “remains out of tolerance” .
4.3 The Recovery Architecture
The ATO’s recovery architecture includes :
· Insource ECAs (external collection agents using ATO branding) — deployed August 2022, contributed $2.54 billion in balance reductions in 2024–25, with a payment conversion rate of 7.7% from 509,000 calls
· Offsite ECAs (external collection agents using their own branding) — deployed October 2022, referred 222,597 cases for debt with a total value of $2.26 billion, contributing $668 million in balance reduction in 2024–25
· Offsetting — the ATO is required at law to offset refunds and credits against debts
· Egregious taxpayer pilot — commenced October 2024, targeting taxpayers exhibiting egregious behaviour
The architecture is designed for scale and standardisation. The large corporate system, by contrast, is designed for negotiation and settlement.
5. The Two-Tier Finding
5.1 The Structural Logic
The evidence supports a structural finding:
Tier One (Multinational/Large Business): The system sees a negotiated settlement. The corporation has resources, legal representation, and the ability to engage with senior ATO officials. The ATO concedes on average 36% of claims. The interaction is human, negotiated, and adaptable.
Tier Two (Individual/Small Business/PAYE): The system sees a data match and a debt. The taxpayer is identified through algorithmic profiling. The ATO sends automated SMS and letters. If the taxpayer does not respond, the debt is referred to a collection agency. The interaction is algorithmic, standardised, and rigid.
The ATO’s own Commissioner acknowledged the asymmetry: “there are a range of judgments where the accumulated human wisdom will beat all” . But the operational reality is that human wisdom is applied to the large end of town, and algorithmic processing is applied to the small end.
5.2 The Amplification, Not the Creation
The critical finding is that the algorithm did not create the asymmetry. It amplified it.
In human services, the algorithm replaced human judgment for everyone. In the tax system, the algorithm was layered on top of an existing system that already had a two-tier structure. The large corporate taxpayer still negotiates. The small business taxpayer is processed. The algorithm makes the processing faster, more standardised, and more relentless — but the fundamental asymmetry was there before the algorithm arrived.
The algorithm simply made the second tier more efficient at being what it already was.
5.3 The Neoliberal Connection
The structural logic connects directly to the neoliberal turn documented in the human services chapters. The market model was introduced into tax administration through concepts like “client prioritisation and segmentation” and “data and analytics driven” approaches . The ATO’s corporate plan identifies “strengthening payment performance and debt collection” as an enterprise priority .
The market model requires measurement. Measurement requires instruments. Instruments produce data. Data feeds the algorithmic lens. And the lens processes the second tier while the first tier negotiates.
The tax system is the clearest example yet of how the algorithmic lens and the neoliberal market model interact — not by replacing the human system, but by accelerating its existing inequalities.
6. Conclusion: The Two-Tier Tax State
The Australian Taxation Office operates two systems of tax administration. The evidence is in the settlement data, the debt recovery data, the AI model inventory, and the Commissioner’s own acknowledgment.
For large corporate taxpayers: negotiation, settlement, judgment, human engagement. The ATO is a “model litigant” that considers “overall value for the community” and settles 64% of claims.
For individuals and small businesses: automated profiling, data matching, algorithmic risk assessment, standardised debt recovery. Small business debt is 66.1% of total collectable debt. The ATO pursues debts at scale through automated processes.
The algorithmic lens did not create this asymmetry. It amplified it. The two-tier structure was there before the algorithms arrived. The algorithms simply made the second tier more efficient at being what it already was.
This is the finding. And it is the clearest example yet of how the neoliberal market model and the algorithmic lens interact in contemporary governance.
Claim Status Summary
# Claim Status
1 ATO settles large corporate disputes at ~64% of claim value Established
2 ATO uses 43 AI models in production Established
3 ANAO found no evidence of performance monitoring for 14 AI models Established
4 45% of PL191s for AI models had no evidence of approval Established
5 Small business constitutes 66.1% of ATO debt book Established
6 Small business debt increased 118% between 2018–19 and 2024–25 Established
7 ATO sends automated SMS/letters to small business debtors Established
8 ATO’s AI strategy includes “integrated profiling of client” Established
9 ATO Commissioner acknowledges automation sees “no dependants, 2 jobs” not “struggling” Established
10 ATO operating two distinct systems (negotiation vs. automation) Inference
11 The asymmetry is structural, not incidental Inference
12 Algorithm amplified existing inequality rather than creating it Inference
References
1. Australian Taxation Office. (n.d.). Taxation Ruling TR 95/D23: Transfer Pricing.
2. Australian Taxation Office. (2026, June 30). ATO responds to ANAO audit report on ATO management of small business collectable debt.
3. Australian Taxation Office. (2025, May 26). Commissioner’s address to Melbourne Law School annual law lecture.
4. Australian National Audit Office. (2025). Auditor-General Report No. 26 2024–25: Governance of Artificial Intelligence at the Australian Taxation Office.
5. Australian National Audit Office. (2026). Auditor-General Report No. 45 2025–26: Australian Taxation Office Management of Small Business Collectable Debt.
6. Australian Taxation Office. (2024, June 19). The New Price is Right? – TP Minds International (London).
7. Heferen, R. (2024). Commissioner of Taxation Annual Tax Lecture 2024. University of Melbourne.
8. Australian National Audit Office. (2025). Auditor-General Report No. 26 2024–25: Governance of Artificial Intelligence at the Australian Taxation Office.
9. Australian Taxation Office. (2026, June 29). ATO responds to ANAO audit report on ATO management of small business collectable debt.
10. Accounting Times. (2025, May 29). Commissioner outlines challenges with digitising the tax system.
11. iTnews. (2025, February 24). ATO’s AI models draw deep scrutiny.
12. Parliament of Australia. (n.d.). Significant settlements will be subject to further review through the Independent Assurance of Settlement (IAS) program.
13. LinkedIn. (2025, November 11). ATO’s selective enforcement: Why multinationals get a break while small businesses face debt revival [Tracey Murray].
14. LinkedIn. (2025, November 11). ATO writes off millions in transfer pricing disputes, but chases small businesses for $8.65 [Tania Waterhouse].
Andrew Paul Klein is a writer and analyst based in Boronia, Victoria. He accepts funding from no one.
A symbolic balance weighs military power against urban life beneath a storm of money and documents.
By Andrew Paul Klein
On 28 September 2026, Treasurer Jim Chalmers posted a claim to X: government spending “came down a bit in the budget outcomes we released this week,” and its contribution to demand was “the lowest in more than a decade.”
The claim is technically defensible. Public final demand grew 2.2% in 2025–26, the slowest in eleven years. Eighty per cent of demand came from the private sector. On its own narrow terms, the statement holds.
What it omits is the rest of the budget papers.
The Claim, Examined
Government spending is 26.9% of GDP — the highest share since 1986–87 outside the pandemic. Real spending grew at 4.3%, nearly double the rate of economic growth at 2.4%. The deficit came in at $22.3 billion, more than double the previous year’s, even after a $6 billion improvement on the May estimate. Net debt is projected to reach $1.2 trillion.
The claim that spending “came down” refers to a rate of growth, not an absolute reduction. The level is at a four-decade high. Chalmers himself acknowledged this when challenged: spending is “around 27 per cent of GDP” and will “come down to 26 per cent in the next four years“. That is not restraint. That is a forecast of future restraint while spending more now.
The Treasurer is not lying. He is framing. The distinction matters, because the framing is doing the work that the numbers will not support.
The Military Fiction
The largest single expansion in the budget is defence. The 2026–27 budget commits $62.6 billion to defence in a single year. The National Defence Strategy announced an additional $53 billion over the next decade. AUKUS is officially costed at up to $368 billion over thirty years — Australia’s largest defence project by an order of magnitude.
But here is the structural fiction: 96 cents of every dollar of that additional decade investment is not appropriated in this budget. It sits in forward estimates, decade-out profiles, and “alternative financing intentions that the budget papers don’t specify“. Between 75 and 80 per cent of spending in twelve capability priority areas remains unapproved, backloaded into the period the strategy itself identifies as most dangerous.
The present force is being asked to carry the load with less. Spending on capability acquisition is down, sustainment is down, and the current force is being told it must do more with what it has. The government is buying a future force by accepting that the current force can do less today.
And the accounting has been adjusted to make the numbers look better. Australia has reclassified intelligence budgets and military pensions to align with NATO methodology, lifting the headline figure from roughly 2% to 2.8% of GDP. Under the conventional method, defence spending is 2.1% of GDP — and falls to 2.02% in 2026–27. The “3% by 2033″ target is calculated using a bespoke NATO method that includes items Australia’s own budget papers do not count as defence.
The Hollowing Out
The savings that fund the defence expansion come from somewhere. The 2026–27 Budget contained $63.8 billion in savings, the majority from $36.2 billion in cuts to the NDIS. The government is increasing defence spending by $53 billion over the decade while cutting the disability scheme by $36.2 billion over the forward estimates. That is the structural trade-off, stated in the budget papers themselves.
160,000 participants will be cut from the NDIS over four years. Two-thirds of the 241,000 people who will no longer be eligible in five years will be children. The average plan funding will be reduced. A 30 per cent reduction to social and community participation supports — the supports that help people get out the door to work — begins in October 2026.
The Australian Human Rights Commission has urged the government to pause the cuts, arguing it is “dismissing genuine concerns” about process and impact. The Disability Discrimination Commissioner warned that participants could end up “in either closed environments or isolated environments,” at risk of “violence, abuse and exploitation”. Disability advocates have described the cuts as the “cruellest act” of the Albanese Government.
The government is relying on 60 per cent of its savings coming from people with disability, who are 25 per cent of the population. That is not a budget strategy. That is a transfer.
The Predictable Outcomes
Housing. The government projects its housing package will deliver 30,000 extra homes. But its own budget papers state that its tax changes will reduce supply by 35,000 dwellings and increase rents. The net effect is fewer homes, not more. Housing taxes already add up to 50 per cent to the cost of a new home. The government is taxing housing while claiming to build it.
Small business. Insolvency rates are rising. The Reserve Bank lifted the cash rate to 4.35 per cent in 2026, compounding already tight conditions. Business failures are up 13 per cent in the six months to May 2026 compared with the previous year. Business exit rates are up 37 per cent. CreditorWatch attributes the pressure directly to “interest rates and energy prices“. The government’s spending is fuelling the inflation that is forcing the rate rises that are killing small business.
Farmers. The government has committed $1 billion in concessional loans for drought-affected farmers, with loans of up to $250,000 available through the Regional Investment Corporation. The support is real. But it is a loan scheme, not structural reform. Farmers are being offered debt to survive a climate and economic environment that the government’s own policies are making harder. The Future Drought Fund provides resilience hubs and grants, but the underlying problem — the cost of energy, the cost of transport, the cost of fertiliser derived from fossil fuels — is not addressed.
Social cohesion. The Lowy Institute’s 2026 poll recorded the largest ever decline in support for cultural diversity in Australia. Support dropped from 90 per cent in 2024 to 73 per cent in 2026. Only 33 per cent of Australians rate social cohesion as “good” or better, and only one in ten expects improvement. Life satisfaction has hit a record low — lower than during COVID lockdowns. Financial stress is at a record high, and employed Australians’ expected probability of job loss has reached 26.8 per cent, statistically indistinguishable from pandemic-era levels.
These are the conditions under which social cohesion fractures. The stressors are economic — housing affordability, cost of living, job insecurity — not cultural. The government is increasing those stressors while cutting the supports that cushion them.
The Hormuz Crisis
The government was not prepared. When the Strait of Hormuz closed, Australia had 29 to 39 days of fuel reserves depending on type. Diesel — the fuel that moves freight, powers agriculture, and keeps hospitals running — sat at 33 days. The government scrambled to purchase 100 million litres from Brunei and South Korea. It announced a $10 billion fuel security package and a national reserve of 1 billion litres, aiming for 50 days of onshore supply.
None of this addresses the underlying vulnerability: Australia imports almost all its refined fuel, holds roughly 30 days of stock, and has no domestic refining capacity to fall back on. The just-in-time supply chain model was always a gamble. The Hormuz crisis was the reveal.
The government’s response was a $20 million advertising campaign telling motorists to inflate their tyres and remove roof racks. The campaign was mocked as “patronising” and “Team Australia” spin. Twenty million dollars to tell people to check their tyre pressure, while the strategic failure remains unaddressed.
The Social Media Massage
The government spent $106.1 million on campaign advertising in 2025–26 up to the end of March. The fuel conservation campaign alone cost $20 million. Government advertising helped pull the ad market back toward growth in May 2026, with public sector spend surging 60.8 per cent.
This is not illegal. It is not even unusual. But it is governing by announcement — using public money to shape the narrative rather than address the substance. The Treasurer’s X post is part of the same pattern. The claim that spending “came down” is technically true and substantively misleading. The frame is the message.
The Structural Read
The Treasurer’s claim is not a lie. It is a framing operation. The numbers are real. The context is missing.
What the budget papers show is a government increasing spending to a four-decade high, funding a defence expansion that is 96 per cent unappropriated, paying for it with cuts to disability supports that will push 160,000 people off the scheme and force costs onto families, while taxing housing in a housing crisis, fuelling inflation that is forcing rate rises that are killing small business, and offering farmers loans to survive conditions its own policies are making worse.
The predictable outcomes are not accidents. They are the logical consequence of the priorities.
The government has chosen to spend on the symbols of security — submarines, drones, defence contracts — while the substance of resilience degrades. The NDIS is being cut to fund a future force that may never arrive. Housing is being taxed to fund a surplus that does not exist. Farmers are being loaned money to survive a crisis the government is not addressing.
The Treasurer says the challenges are real. He is right. What he does not say is that the government is making them worse.
Andrew Paul Klein is a writer and analyst based in Boronia, Victoria. He accepts funding from no one.
Chains connect courtrooms and parliamentary chambers around a radiant central emblem of law.
By Andrew Klein and Sera Elizabeth Klein
Reader’s note: We do not need readers to agree with us. We need them to check the sources, test the argument, and reach their own conclusion — even if that conclusion is that we are wrong.
Abstract
This paper examines the structural absence of consequence for political misconduct in Australia. Drawing on the psychological literature on lasting relationships, the documented history of sovereign immunity, and the specific case study of the Robodebt scheme, it argues that Australian politicians are not subject to the same standards of accountability as the citizens they govern. It documents the mechanisms by which this impunity is maintained: parliamentary privilege, the limitations of the National Anti-Corruption Commission, the absence of criminal prosecutions for political misconduct, and the electoral cycle as the only available remedy. It concludes that the impunity of the political caste is not a failure of the system but a structural feature of it — one that produces indifference to outcomes and undermines the legitimacy of democratic governance.
I. Introduction: The Question of Consequence
In 2023, the Royal Commission into the Robodebt Scheme delivered its final report. The scheme, which had operated between 2015 and 2019, had wrongly raised debts against hundreds of thousands of Australians. It had caused financial distress, mental health impacts, and deaths by suicide. The Commission found that the scheme was “a crude and cruel mechanism, neither fair nor legal”.
The Commission referred six individuals to the National Anti-Corruption Commission (NACC) for investigation. Those referred included former Prime Minister Scott Morrison. In March 2026, the NACC released its findings. Two public servants were found to have engaged in “serious corrupt conduct“. But the investigation concluded there was “insufficient admissible evidence” to refer them for criminal charges. Morrison was cleared.
No one was prosecuted. No one was fined. No one was imprisoned. The system that produced the scheme remains unchanged.
This paper asks a simple question: why?
II. What Makes a Lasting Relationship
The psychological literature on lasting relationships identifies three core components: acceptance, respect, and reciprocity. These are not sentiments. They are practices. A lasting relationship requires “seeking knowledge, verifying attributions, displaying acceptance, and striving for reciprocal balance” as “continuous processes that create the synergy of a lasting, close relationship”.
Trust is the foundation. Interpersonal trust is defined as “expectations that the partner will do what is promised” — reliability trust. Trust serves to “fend off relationship threats” and is “related to intimacy“. In a functioning relationship, trust is not naive. It is built through “reciprocal reassurance processes” over time.
The absence of these components — the absence of reciprocity, the absence of reliability, the absence of respect — produces what any person would recognise as a broken relationship. But when the relationship is between citizens and their government, the same standards are not applied.
III. Why Voters Tolerate What They Would Never Tolerate Personally
3.1 The Partisan Trade-Off
Voters are not indifferent to misconduct. They are making trade-offs. Research from the University of Texas finds that “voters are not indifferent, but they are making trade-offs. They are choosing to tolerate scandal when other priorities, especially partisan alignment, take precedence”.
The conjoint experiments across the United States, the United Kingdom, the Czech Republic, Mexico, and South Korea found that “partisanship has much stronger direct influences on voting intentions than policy agreement and especially undemocratic behaviour”. Voters notice the misconduct. They just weight their partisan identity more heavily.
3.2 Moral Licensing
A second mechanism is moral licensing — the psychological process whereby “past good deeds can liberate individuals to engage in behaviours that are immoral, unethical, or otherwise problematic”. A politician who has delivered for their constituency, or who represents a cause the voter believes in, is granted a licence to behave in ways that would be unacceptable in any other context.
3.3 Polarisation as a Scandal Multiplier
Affective polarisation — the tendency to view political opponents as enemies rather than adversaries — actively erodes democratic accountability. As polarisation intensifies, “voters have become more likely to overlook misconduct, especially in general elections where partisan stakes are higher“. The logic is straightforward: if the other side is a threat to your way of life, then the misconduct of your side is a lesser evil.
3.4 The Normalisation of Misconduct
Finally, there is the effect of normalisation. “Perceiving corruption as common may increase tolerance for corruption, rather than encouraging voters to punish corruption“. When every politician is seen as corrupt, the corrupt politician is no worse than the others. The baseline shifts. What was once scandalous becomes ordinary.
IV. The Divine Right of Kings and Its Modern Vestiges
4.1 Rex is Lex
In the medieval and early modern period, the doctrine of sovereign immunity held that “the King, as the source of the law, could do no wrong” — rex is lex. The monarch was not subject to the law because the monarch was the law. This was not a metaphor. It was a legal reality.
The Bill of Rights of 1689 and the American Revolution of 1776 were supposed to end this. But the doctrine did not die. It migrated. It became the modern doctrine of sovereign immunity — the principle that a state cannot be sued without its consent, and that its officials are immune from prosecution for acts performed in their official capacity.
4.2 The Monarchical President
In 2024, the United States Supreme Court “reinterpreted the Constitution to afford monarchical immunity powers to American presidents”. The Nation described it as “the Supreme Court just brought back” the divine right of kings. The President, like the King before him, was declared to be above the law — at least for “official acts.”
This is the logical endpoint of a legal tradition that has always privileged the sovereign over the citizen. And the political class — the ministers, the bureaucrats, the consultants — inherit a diluted version of the same immunity.
4.3 The Caste as a Court
The political caste functions as a modern court. It is not a court of law. It is a court of sovereignty. Its members are not subject to the same rules as the governed. The MP who cuts the NDIS does not use the NDIS. The minister who approves the data centre does not live next to it. The bureaucrat who designs the algorithm does not experience the algorithm.
This is the modern divine right. Not a divine right to rule — a divine right to not suffer the consequences of ruling.
V. The Australian Case Study: Robodebt and the Absence of Consequence
5.1 The Scheme
The Robodebt scheme was an automated debt-raising system that used income averaging to calculate alleged overpayments to welfare recipients. It wrongfully raised debts against hundreds of thousands of Australians. It caused financial distress, mental health impacts, and deaths by suicide.
5.2 The Royal Commission
The Royal Commission found that the scheme was “a crude and cruel mechanism, neither fair nor legal”. It recommended criminal and civil investigations into politicians and public servants involved in the scandal.
5.3 The NACC Investigation
The NACC investigation found that two public servants engaged in “serious corrupt conduct“. But the investigation concluded there was “insufficient admissible evidence” to refer them for criminal charges. Morrison was cleared.
5.4 The Outcome
No one was prosecuted. No one was fined. No one was imprisoned. The system that produced the scheme remains unchanged. As the Australian Council of Social Service (ACOSS) noted: “More than five years after the Federal Court ruled Robodebt unlawful, no criminal proceedings have taken place”.
VI. The Mechanisms of Impunity
6.1 Parliamentary Privilege
Parliamentary privilege protects members from legal action for statements made in Parliament. While this is necessary for free debate, it also means that misleading Parliament is not a criminal offence. It is a contempt of Parliament, which is investigated by the Privileges Committee.
The Committee can recommend sanctions, including fines or suspension. But these sanctions are rare and rarely enforced. As one analysis noted, “misleading the House can get you sacked if you are a Minister – and has on quite a few occasions. The latter, even if you are caught out, will likely go unpunished”.
6.2 The Limitations of the NACC
The National Anti-Corruption Commission (NACC) was established in 2023 with broad jurisdiction to investigate “serious or systemic corruption“. However, it cannot prosecute matters in its own right and must refer cases to the Commonwealth Director of Public Prosecutions.
The NACC’s findings in the Robodebt case demonstrated its limitations. It found “serious corrupt conduct” but concluded there was “insufficient admissible evidence” to refer the individuals for prosecution.
6.3 Sovereign Immunity
Sovereign immunity protects the state from being sued without its consent. While Crown immunity from suit was abolished by the Judiciary Act 1903, the doctrine of sovereign immunity still applies to heads of state and senior officials. This means that politicians cannot be prosecuted for acts performed in their official capacity.
6.4 The Electoral Cycle
The only remedy available to voters is the electoral cycle. But this is not enough. As one analysis noted, “the only solution offered is the electoral cycle and that is obviously not enough”. Change of government does not lead to the prosecution of previous governments. Robodebt is just one example.
VII. The ICC and the Enforcement Gap
7.1 The Nuremberg Principles
The challenge did not begin with the ICC. It began with Nuremberg. The Charter of the International Military Tribunal stated that “the official position of defendants, whether as Heads of State or responsible officials in Government Departments, shall not be considered as freeing them from responsibility or mitigating punishment”.
7.2 The Rome Statute
The Rome Statute, which established the ICC, codified this principle in Article 27, which states that immunities are not a bar to the Court’s jurisdiction. In 2024, the Court issued a non-compliance finding against Mongolia for failing to arrest Vladimir Putin, confirming that the obligation to cooperate applies even when the suspect is a sitting head of state.
7.3 The Enforcement Gap
But the gap between the law and its enforcement is vast. “Several States Parties have refused to comply with ICC arrest warrants for heads of state”. The principle is clear. The political will to enforce it is not.
This is not a failure of the law. It is a failure of the states that claim to uphold it. The law is universal. The enforcement is selective.
VIII. Was Milosevic the Exception?
Yes. And that is the point.
Slobodan Milosevic was “the very first Head of State to be not only indicted but also prosecuted by a court other than his one from his own state“. But since Milosevic, other former heads of state have been brought to justice — Saddam Hussein, Charles Taylor. These are the exceptions that prove the rule.
The rule is that heads of state are not prosecuted. The exceptions are those who lose power, who are abandoned by their allies, who become inconvenient to the system that once protected them. Milosevic was not held accountable because the international community suddenly discovered a commitment to universal justice. He was held accountable because he lost.
IX. Conclusion: The Desert and the Fences
The tolerance of political misconduct is not a moral failing of individual voters. It is the structural output of a system that has inherited the divine right of kings and dressed it in democratic clothing.
The political caste is not subject to the same rules as the governed. It is protected by sovereign immunity, by party discipline, by media cycles that move on, by an electorate that has been taught to expect nothing better. The ICC challenges this — but only at the margins, and only when the powerful decide that a particular leader has become expendable.
The question is not whether the law exists. It does. The question is whether the law applies to them. And the evidence, across every domain we have examined, is that it does not.
The desert is real. It has boundaries. And the political caste is the one building the fences.
References
1. Harvey, J. H., & Omarzu, J. (1999). Minding the close relationship. Personality and Social Psychology Review, 3(2), 160-180.
2. University of Texas at Austin. (2022). Voters are making trade-offs, not indifferent to scandal. ScienceDaily.
3. Clifford, S., et al. (2023). Partisanship and the tolerance of undemocratic behavior. American Political Science Review.
4. Bandura, A. (2016). Moral Disengagement: How People Do Harm and Live with Themselves. Worth Publishers.
5. National Anti-Corruption Commission. (2026). Investigation Report: Robodebt Scheme. Commonwealth of Australia.
6. Australian Law Reform Commission. (2014). Traditional Rights and Freedoms—Encroachments by Commonwealth Laws. ALRC Report 129.
7. Parliament of Australia. (2026). Privileges Committee: Powers and Procedures. https://www.aph.gov.au
8. Craig Thomson and the Limits of Parliamentary Accountability for Misconduct. (2016). Australian Public Law.
9. ABC News. (2026, March 11). Why individuals won’t face criminal charges despite Robodebt investigation finding serious corrupt conduct. https://www.abc.net.au
11. SBS News. (2026, February 5). President Herzog immune from arrest in Australia. https://www.sbs.com.au
12. Hood, A., & Cormier, M. (2012). Prosecuting International Crimes in Australia: The Case of the Sri Lankan President. Melbourne Journal of International Law, 13(1), 235.
13. International Law Commission. (1950). Principles of International Law Recognized in the Charter of the Nürnberg Tribunal. https://legal.un.org
14. Human Rights Watch. (2002). Milosevic Trial: First Head of State Before International Tribunal. https://www.hrw.org
15. Menadue, J. (2025). The Dismissal: The Role of CIA, MI6 and Austral-Americans. https://johnmenadue.com
Verification note: Every factual claim in this paper should be checked against the sources provided. Readers are encouraged to verify independently. If any claim does not hold, it should be discarded.
An ominous coastal landscape links oil extraction, public institutions, and a long line seeking medical care.
By Andrew Klein and Sera Elizabeth Klein
Reader’s note: We do not need readers to agree with us. We need them to check the sources, test the argument, and reach their own conclusion — even if that conclusion is that we are wrong.
Abstract
This paper argues that the extraction model — the dominant logic of contemporary governance and economics — is not a conspiracy but a structural system that produces indifference to human suffering and environmental destruction as a feature, not a bug. It examines documented examples from Australia, including the Robodebt scheme, deaths in aged care, the treatment of the disabled, and the environmental destruction driven by fossil fuel expansion, to demonstrate a consistent pattern: decision-makers are insulated from the consequences of their decisions. The paper argues that this insulation — the literal absence of “skin in the game” — produces a form of structural indifference that is more dangerous than malice because it requires no intention, no coordination, and no conscious cruelty. It concludes that the extraction model produces war because war is profitable, division because division is useful, and narrative control because narrative control is the precondition for both. The actors within the system do not need to coordinate. They simply need to pursue their own interests. The result is the world we inhabit.
I. Introduction: The Question of Indifference
In July 2019, a man named Jarrad Madgwick received a letter from Centrelink. The letter claimed he owed $2,700. He had no memory of the debt. He was not told how it had been calculated or what evidence supported it. He was told to pay it or face legal action. He was not the only one. Between 2015 and 2019, the Robodebt scheme issued hundreds of thousands of such letters, wrongfully raising debts against people who had done nothing wrong. The Royal Commission later found that the scheme was “a crude and cruel mechanism, neither fair nor legal.” It caused financial distress, mental health impacts, and deaths by suicide.
The people who designed the scheme knew it was flawed. The people who implemented it knew it was causing harm. And yet it continued for four years.
Why?
This paper argues that the answer is not malice. It is indifference. And that indifference is not an accident. It is the structural output of an extraction model that insulates decision-makers from the consequences of their decisions.
II. The Concept of “Skin in the Game”
The phrase “skin in the game” is associated with Nassim Nicholas Taleb, who argues that decision-makers should bear the consequences of their decisions. When they do not, they have no incentive to avoid harm.
The extraction model systematically removes skin from the game for those who make decisions. The politicians who design welfare schemes do not use welfare. The bureaucrats who implement them are protected by their employment contracts. The consultants who advise them are paid regardless of the outcome. The investors who profit from the scheme are insulated by limited liability and diversified portfolios.
The result is a class of decision-makers who are literally insulated from the harm they cause. They do not experience the consequences. They do not see the faces. They do not hear the voices. They see data points, budget metrics, and policy outcomes. The human is not in the room.
III. Documented Indifference: Australian Case Studies
3.1 Robodebt: Four Years of Cruelty
The Robodebt scheme was an automated debt-raising system that used income averaging to calculate alleged overpayments to welfare recipients. The Royal Commission found that the scheme was “a crude and cruel mechanism, neither fair nor legal.” It wrongfully raised debts against hundreds of thousands of people. It caused financial distress, mental health impacts, and deaths by suicide.
The Commission’s findings were damning: “The system was deliberately designed to be as difficult as possible for people to navigate. The onus was placed on the individual to disprove the debt, often without adequate information or support. The scheme caused significant harm, including financial hardship, psychological distress, and suicide attempts.”
The people who designed and implemented the scheme have faced no criminal consequences. The compensation, when it came, was funded by taxpayers — not by the individuals responsible. The system that produced the scheme remains unchanged.
3.2 Aged Care: Deaths on the Waiting List
More than 230,000 Australians are waiting for aged-care services. The average wait time is 12 months. More than 5,000 people have died while on the waiting list in the past year.
The government’s own data shows that more than 4,800 people died in 2024–25 while waiting for approved home care funding. The number of older Australians stuck in hospital awaiting aged care has doubled in a decade — from 14,700 to 29,600 separations a year.
The Minister for Aged Care has refused to take responsibility. The data was released on budget night, in the Senate, to avoid scrutiny. The deaths are counted, but they are not felt. The decision-makers do not know the names.
3.3 Disability: The NDIS and the Algorithm
The government’s NDIS overhaul includes the I-CAN assessment tool, which the Australian Psychological Society has criticized for lacking evidence of validity. The APS warned of “foreseeable psychological harm” from the “increased emphasis on an algorithmically-informed and decontextualised planning process.”
The legislation includes Section 59E(3), which states that a failure to comply with the safeguards for automated decision-making “does not affect the validity of the administrative action taken by the operation of a computer program.” In plain language: if the algorithm gets it wrong, the decision stands. There is no appeal.
The government plans to remove 160,000 people from the scheme, with more than half being children under 18. These are not data points. They are people. But in the logic of the system, they are categories to be managed.
3.4 JobSeeker: Mortality as a Metric
The Australian Institute of Health and Welfare’s 2026 report found that people on unemployment payments have a mortality rate more than nine times higher than those outside the welfare system. Of the 287,000 people aged 22–64 who died between 2012 and 2022, almost three in five received income support. Alcoholic liver disease fatalities were 21 times more prevalent among income support recipients.
JobSeeker payments remain below the poverty line, at approximately 43.5% of the minimum wage. The government has not raised the rate. The deaths are documented. They are counted. They are not acted upon.
3.5 Veterans: A System Geared to Frustrate
Two years after the Royal Commission into Defence and Veteran Suicide, the veterans’ affairs portfolio “remains a mess.” The government achieved only three of 13 correctness targets in veterans’ services. Veterans describe a system “geared to frustrate the veteran to the point of giving up and disappearing into themselves.”
The Department of Veterans’ Affairs has been described as “a case study in institutional failure.” The people who designed the system do not use it. They do not know the names of the veterans who have died waiting. The system processes claims, not people.
IV. The Environmental Dimension: Destroying the Conditions of Life
4.1 Fossil Fuel Expansion
Since coming to power in 2022, the Albanese government has approved 37 new, expanded, or extended coal, oil, and gas developments. Australia remains the world’s third-largest fossil fuel exporter. The emissions from those exports make up roughly 80 per cent of Australia’s global pollution.
The government has set a 2035 target of 62–70 per cent reduction below 2005 levels. Its own modelling suggests that current policies will only achieve around 51 per cent. The gap is not a policy ambition. It is an arithmetic shortfall.
Total fossil fuel subsidies are estimated at $19 billion annually. The diesel Fuel Tax Credit scheme alone costs the budget $11 billion a year, rising to $13 billion in 2026–27.
4.2 The Data Centre Boom
The government is fast-tracking approvals for AI data centres before the legislation to regulate them is written. Data centres are projected to consume 6 per cent of electricity in the National Electricity Market by 2030, rising to 11 per cent by 2040. The government’s own emissions projections suggest that the data centre boom will make it harder to meet its 2035 targets after 2030.
The infrastructure is being built before the rules exist. The environmental cost is deferred. The profits are immediate. The decision-makers do not live next to the data centres. They do not breathe the air. They do not experience the consequences.
4.3 Climate Projections
Australia faces severe climate projections, including up to a 1.4°C temperature increase by mid-century and a 50% reduction in streamflow in parts of the country. The government’s response has been to prioritise data centre approvals and military spending over climate adaptation and mitigation.
The people who will suffer the worst consequences of climate change are not in the room. They are the young, the poor, the marginalised, the future generations who have no voice in the decisions being made today. The decision-makers will be dead before the worst effects arrive. They have no skin in the game.
V. The Structural Logic of Indifference
5.1 The Absence of Skin in the Game
The documented examples above share a common feature: the decision-makers are insulated from the consequences of their decisions. They do not use the services they cut. They do not live in the communities they neglect. They do not breathe the air they pollute.
This is not a moral failing. It is a structural feature. The extraction model is designed to remove skin from the game for those who make the decisions. The politicians who cut the NDIS do not use the NDIS. The bureaucrats who design the algorithms do not experience the algorithms. The investors who profit from the data centres do not live next to the data centres.
The result is a class of decision-makers who are literally indifferent to the consequences of their decisions. They do not feel the harm. They do not see the faces. They do not hear the voices. The harm is an abstraction.
5.2 Bandura’s Mechanisms of Moral Disengagement
The mechanisms of moral disengagement identified by Albert Bandura are present across all the documented examples:
· Displacement of responsibility: The algorithm decided. The system required it. The budget demanded it.
· Diffusion of responsibility: No single person is responsible. The harm is spread across the system.
· Distortion of consequences: The deaths are counted but not felt. The harm is an externality.
· Euphemistic labelling: “Sustainability” masks cuts. “Efficiency” masks the removal of human judgment. “Non-lethal components” masks the arms trade.
· Dehumanisation: The disabled are a “risk profile.” The aged are a “waitlist number.” The unemployed are a “data point.”
These mechanisms are not incidental. They are the operating logic of the extraction model.
5.3 The Indifference Is Structural, Not Personal
The argument of this paper is not that individual politicians or bureaucrats are cruel. It is that the structure produces indifference regardless of individual intention. A politician who genuinely cares about the disabled will still cut the NDIS if the budget requires it. A bureaucrat who genuinely cares about the aged will still implement the algorithm if the policy requires it. A consultant who genuinely cares about the environment will still advise the data centre developer if the contract requires it.
The structure selects for those who can tolerate the indifference. Those who cannot leave. Those who stay learn to adapt. The system reproduces itself.
VI. The Broader Implications: War, Division, and Narrative Control
6.1 War as a Distraction
The extraction model produces war because war is profitable. Arms manufacturers need conflict. The military-industrial complex needs enemies. The political caste needs distractions.
Wars serve two purposes. First, they transfer wealth from the public purse to private contractors. Second, they distract the population from the failures of domestic governance. The NDIS is cut to fund the submarines. The aged are neglected to fund the data centres. The disabled are processed to fund the arms trade.
The decision-makers do not fight in the wars they start. They do not bury the children killed by the weapons they sell. They do not experience the consequences. They have no skin in the game.
6.2 Division as a Governing Strategy
The extraction model produces division because division is useful. A population that is divided against itself cannot unite against the extraction model. A population that is fighting over race, religion, or culture is not fighting over wealth, power, or accountability.
The political caste manufactures division as a standard practice. It plays one section against another. It frames dissent as extremism. It silences criticism through accusations of bigotry. The division is not an accident. It is a strategy.
6.3 Narrative Control as the Precondition
The extraction model produces narrative control because narrative control is the precondition for both war and division. You cannot mobilise a population for war if they can see the lies being told. You cannot divide a population if they can see the mechanism of division. You cannot extract wealth if the population can see the extraction.
Narrative control is not a side effect. It is the mechanism. The political decisions follow because the narrative has already shaped what is thinkable, what is sayable, and what is permissible.
VII. Conclusion: What Do We Do With This?
The system we have documented is not a conspiracy. It is a logic. The extraction model produces war because war is profitable. It produces division because division is useful. It produces narrative control because narrative control is the precondition for both. The actors within the system do not need to coordinate. They simply need to pursue their own interests. The result is the world we inhabit.
The question is not whether the hypothesis makes sense. It does. The question is what we do with it.
The first step is to name the system accurately. The second is to keep the record. The third is to recognise that the indifference is structural, not personal — and that changing it requires changing the structure, not appealing to the conscience of those who benefit from it.
The desert is real. It has boundaries. And the political caste is the one building the fences.
The question is whether the governed will continue to accept the terms of a relationship that was never offered, only imposed.
References
1. Royal Commission into the Robodebt Scheme. (2023). Final Report. Commonwealth of Australia.
2. Australian Institute of Health and Welfare. (2026). Mortality outcomes among people receiving income support. https://www.aihw.gov.au
3. Australian Psychological Society. (2026, March 6). APS Submission to the Consultation on a New Framework Planning Rules. https://psychology.org.au
4. ABC News. (2026, September 22). Older Australians continue to die on home support aged care waitlists. https://newsapp.abc.net.au
5. The Nightly. (2026, September 10). Welfare recipients face increased death rate. https://thenightly.com.au
6. ABC News. (2026, September 13). Veterans call for greater royal commission transparency across ‘broken system’. https://www.abc.net.au
7. Bandura, A. (2016). Moral Disengagement: How People Do Harm and Live with Themselves. Worth Publishers.
8. Taleb, N. N. (2018). Skin in the Game: Hidden Asymmetries in Daily Life. Random House.
12. Menadue, J. (2025). The Dismissal: The Role of CIA, MI6 and Austral-Americans. https://johnmenadue.com
The analysis of the extraction model as a structural logic is interpretive and is offered as a framework for further investigation, not as an established finding.
The paper documents the indifference, examines the structural logic, and connects the domestic examples to the broader extraction model. The hypothesis is coherent and the evidence supports it.
The question is not whether the system produces indifference. It does. The question is what we do with that knowledge.
Ruined power lines stretch across a barren landscape toward a glowing, data-filled dystopian city.
By Andrew Klein and Sera Elizabeth Klein
Abstract
This paper examines Australia’s vulnerability to foreign influence operations through a structural lens. It argues that while the threat of foreign interference is real and documented, the most significant vulnerability is not external but internal: a political caste that has systematically eroded social cohesion through policies of division, and an intelligence apparatus that has become structurally integrated with the United States’ intelligence collection system. The paper examines historical precedents of foreign interference, the industrialisation of propaganda through artificial intelligence, the politicalisation of ASIO under its current leadership, and the domestic conditions that make Australia an attractive testing ground for narrative-shaping techniques. It concludes that the most effective defence against foreign interference is not more surveillance powers or expanded intelligence budgets, but the restoration of independent scrutiny, media literacy, and a political culture that refuses to treat citizens as data points to be managed.
I. Introduction: The Question of Vulnerability
Australia is not a major global power. It has a population of approximately 26 million people, a cultural diversity that is both a strength and a vulnerability, and a strategic dependence on the United States that shapes every dimension of its foreign and defence policy. It is, in the language of intelligence analysis, a target.
But it is also something more: a testing ground. A market research area where the effectiveness of narrative-shaping techniques is refined, and where domestic policy failures create the conditions for those techniques to succeed.
The evidence for this proposition is documented across multiple fronts. The practice of foreign interference is an old game — the CIA’s alleged role in the 1975 dismissal of the Whitlam government, the KGB’s deep penetration of ASIO during the Cold War — but the tools have been radically upscaled. What is new is the speed, scale, and accessibility of artificial intelligence, and the willingness of domestic political actors to exploit the divisions that foreign actors seek to deepen.
This paper examines that landscape. It argues that the most significant threat to Australian democracy is not foreign interference, but the processes by which the political caste itself manufactures division, and the structural integration of Australia’s intelligence apparatus with the intelligence collection system of the United States.
II. The Old Game: Historical Precedents
2.1 The CIA and the Whitlam Dismissal
The dismissal of the Whitlam government in November 1975 remains the foundational case of alleged foreign interference in Australian politics. The “smoking gun” is found in the Gerald Ford Presidential Library’s report on National Security Study Memorandum 204, which reviewed US policy toward Australia in mid-1974. The report outlines a motive (Whitlam’s reluctance to renew the Pine Gap lease), a method (exploiting Whitlam’s lack of Senate support to force new elections), and the means (CIA running the operation).
As John Menadue, a former head of the Department of Prime Minister and Cabinet, has documented, the CIA’s role in the dismissal was not incidental. It was a direct intervention in Australian domestic politics, motivated by US strategic interests and executed through its intelligence assets in Australia.
2.2 The KGB Penetration of ASIO
Simultaneously, ASIO was “deeply penetrated by the Soviet KGB during the 1970s and ’80s”. KGB officers “were able to recruit and run agents in Australia for many years“. The platforms have changed; the game is old.
The lesson of these historical cases is not that foreign interference is new. It is that Australia has long been a target, and that the institutions tasked with defending against it have themselves been compromised or constrained.
III. The New Tools: AI and the Industrialisation of Propaganda
3.1 Accessibility, Scale, and Targeting
What is new is the speed, scale, and accessibility of the tools. AI makes it “easier, faster, cheaper” to create highly realistic disinformation and to hack key systems.
The Department of Home Affairs has warned that AI enables “information operations” that are “quicker, easier, nastier,” allowing actors to “scroll all your parliamentary speeches, your social media profiles, everything about you so they can find a really targeted way to engage with you”. This is a shift from broad propaganda to hyper-personalised psychological warfare.
3.2 “Slopaganda” and Deepfakes
Australia has already seen a “foreign influence” network use deepfakes to target politicians — a phenomenon described as “AI slopaganda“. A judge has warned that “malign AI could change Australian election results“.
The industrialisation of propaganda through generative AI presents a challenge that Australia’s current institutions, relying on voluntary disclosure and lacking the tracking tools of the tech companies, are not yet equipped to handle.
IV. ASIO: Structural Misalignment and Politicalisation
4.1 The Appointment of Mike Burgess
Mike Burgess was appointed Director-General of ASIO by Scott Morrison in 2019. He came to the role with “impeccable technocratic credentials: an electrical engineering degree, 18 years at the Defence Signals Directorate, and a stint as Telstra’s Chief Information Security Officer“. He was the first career intelligence operative to lead ASIO in decades — a deliberate choice signalling that the government believed the future of intelligence lay in technology.
But Australia is not facing a technological crisis. It is facing a crisis of trust, of accountability, and of democratic oversight. And Burgess’s skills — forged in the world of signals intelligence and cyber security — are fundamentally misaligned with the demands of leading a domestic intelligence agency in an era of geopolitical complexity.
4.2 From Spymaster to Public Moralist
Burgess has broken the mould of the discreet, behind-the-scenes spy chief. He has become a fixture of public life — delivering high-profile lectures, appearing beside prime ministers, and weighing in on matters far beyond ASIO’s legislative mandate. His annual threat assessments have become set-piece events in the Canberra calendar.
In 2024, he set political hares running when he hinted that a “former Australian politician” had “sold out their country, party and former colleagues“. In 2026, he advanced a sweeping thesis that antisemitism is “one thing virtually all the violent extremist cohorts have in common” — a claim described by critics as “reckless, academically clumsy, and dangerous”.
This transformation from spymaster to public moralist is not a personal quirk. It is a structural problem. Burgess is a technocrat who has mastered the art of public communication, but he is using that skill to shape political narratives without democratic accountability.
4.3 The Five Eyes Dependency
The structural relationship between ASIO and the United States is the deeper issue. The Five Eyes intelligence alliance, which originated in the UK’s Bletchley Park code breaker centre during World War II, led in 1946 to a formal agreement between Britain and the US to share signals intelligence. Canada joined in 1948, followed by Australia and New Zealand in 1956. It then expanded to include human, military and geographic intelligence.
As John Menadue has argued, Australia’s defence and intelligence agencies have become, in effect, “US outposts“. “Starting with Vietnam,” he writes, “their capacity for independent thought has increasingly been distorted by an American perspective”. Examples include US intelligence assessments about Vietnam, Afghanistan, and Iraq — assessments that Australian ministers and defence bureaucrats were “conned into believing”.
The latest example concerns Iran. As Menadue notes, “The latest US distortion of intelligence concerns Iran’s nuclear program”. Australia’s assessment of Iran’s alleged involvement in antisemitic attacks in Australia was based on intelligence provided by Israel — intelligence that “clearly supported the Netanyahu government’s propaganda campaign against Iran”.
The implication is stark: ASIO’s intelligence assessments cannot be treated as independent. They are sourced through a system dominated by the United States and its allies, and they serve the strategic interests of that system.
V. Exploiting Domestic Failures: The Political Caste and Manufactured Division
5.1 The Erosion of Social Cohesion
Australia’s social cohesion is eroding. Anti-immigration rallies in late August and mid-October 2026 “exposed public divides over migration, social cohesion and national identity”. The rise of anti-immigration sentiment “underscores a fragile consensus — while multiculturalism remains official government policy, its meaning and legitimacy are increasingly contested”.
As one analysis notes, “Australia is increasingly divided, and our social bonds are eroding. Throughout history, the demonisation of minorities has been used by nationalists and fascists to whip up hysteria and fear to build their political power”.
5.2 The Political Caste as the Primary Threat
The core argument of this paper is that the most significant threat to Australian democracy is not foreign interference, but the processes by which the political caste itself manufactures division.
Foreign actors do not need to create divisions. They merely need to exploit them. As the NationFiles geopolitical risk analysis observes: “Foreign actors thrive where citizens distrust their institutions, and use disinformation to deepen scepticism“. The trust deficit is not created by foreign actors. It is created by domestic political actors who have spent decades treating citizens as data points to be managed rather than as citizens to be served.
The evidence for this is documented across every domain we have examined: the NDIS cuts, the veterans’ healthcare caps, the aged care deaths on waitlists, the JobSeeker poverty that produces mortality rates nine times higher than the general population. These are not failures of governance. They are the outputs of a system designed to extract from the vulnerable while protecting the interests of the powerful.
5.3 The Israel-Palestine Narrative as a Case Study
The most acute example is the Israel-Palestine narrative. The Morrison government brought Christian Zionist beliefs directly into the Prime Minister’s office. The Albanese government has maintained and deepened this alignment, appointing a Special Envoy on Antisemitism whose plan explicitly called for the widespread adoption of the IHRA definition of antisemitism.
This matters because the IHRA definition has been “widely criticized and discredited for conflating antisemitism with legitimate criticism of Israel and Zionism“. Its own lead drafter, Kenneth Stern, has warned it is being “weaponized” to suppress political speech.
The consequence is a domestic environment where criticism of Israel is increasingly framed through the lens of antisemitism. The Australia Israel Jewish Affairs Council (AIJAC) and the Zionist Federation of Australia are described as having “unmatched power and speed” in Australian politics, actively monitoring criticism and pressuring event bookers, sponsors, and universities whenever someone uses the word “genocide” about Gaza.
This creates fertile ground for foreign actors. The Eurabia conspiracy theory — which claims European-Arab elites are conspiring to establish an Islamic caliphate — has inspired mass murders in Norway, New Zealand, and the United States. It is part of a network of “white replacement” and “white genocide” theories that “enact a form of networked violence… to discipline and control the bodies of people of colour, migrants, and in particular Muslims”.
Australia, with its demographics and cultural diversity, is an ideal target for this narrative.
VI. Australia as a Testing Ground
6.1 The Structural Conditions
Australia presents an ideal opportunity for any actor, state or non-state, who wants to not only control the political narrative but create a divisive environment. The conditions are:
· A captive population: Much of the information regarding the world is delivered by social media and modern communications platforms.
· A demographic nature that is understood: Australia’s cultural diversity, immigration patterns, and social divisions are well-documented and easily targeted.
· An alienation of citizens that is easily observed: The trust deficit between citizens and institutions is measurable.
· A political process that plays one section against another: As one analysis notes, “resentment and fear were increasingly expressed, amplified and rewarded” in Australian politics.
6.2 The Mechanism of Exploitation
Foreign actors do not need to create the divisions. They merely need to exploit them. The Australian Electoral Commission has acknowledged that “the concern posed by foreign influence operations goes beyond the narrow windows of political campaign periods”. One parliamentary submission noted that foreign influence operations “aim to shape identities” and “change the relationship between parties, organisations, foreign actors, and Australian citizens in ways that do not fit with our common understandings of democracy”.
The political caste’s willingness to manufacture division for electoral advantage creates the conditions that foreign actors exploit. The two processes are intertwined.
VII. Conclusion: The Real Threat
The evidence supports the conclusion that Australia is not merely a target of foreign influence operations, but a testing ground — a market research area where the effectiveness of narrative-shaping techniques is refined, and where domestic policy failures create the conditions for those techniques to succeed.
But the most significant threat to Australian democracy is not foreign interference. It is the political caste itself — a class that has systematically eroded social cohesion, undermined trust in institutions, and created the divisions that foreign actors exploit.
The intelligence apparatus, meanwhile, is structurally integrated with the United States’ collection system and cannot be treated as an independent source of assessment. ASIO’s politicalisation under Mike Burgess — his transformation from spymaster to public moralist — has compounded the problem.
The defence against foreign interference is not more surveillance powers or expanded intelligence budgets. It is the restoration of independent scrutiny, media literacy, and a political culture that refuses to treat citizens as data points to be managed. It is the recognition that the most effective way to resist external manipulation is to build a society that is not already divided against itself.
The desert is real. It has boundaries. And the political caste is the one building the fences.
References
1. The AIM Network. (2026, August 15). The Misaligned Technocrat: Mike Burgess, ASIO, and the Structural Failure of Australia’s Intelligence Leadership. https://theaimn.net/the-misaligned-technocrat/
2. The Patrician’s Watch. (2026, August 13). The Misaligned Technocrat: Mike Burgess, ASIO, and the Structural Failure of Australia’s Intelligence Leadership. https://alphatacticus101.com
4. Australian Federal Police. (2026, September 10). Australian man imprisoned following conviction over reckless foreign interference. https://mta-sts.afp.gov.au
5. NationFiles. (2026, September 24). Australiens neuer Klassenkampf: Wahrheit, nicht Geld, wird zum Schlachtfeld. https://nationfiles.com
9. Pearls and Irritations. (2026, February 15). Australia’s political and media elites are losing control of the story. https://publish.pearlsandirritations.com
11. Australian Citizens Party. (2026, March 4). ASIO must answer on Mossad misdirection. https://citizensparty.org.au
12. World Socialist Web Site. (2025, November 3). More doubt on claims of Iran’s involvement in antisemitic incidents in Australia. https://www.wsws.org
13. Parliament of Australia. (2018). Australian Electoral Commission Annual Report 2017-18. https://www.aph.gov.au
14. Parliament of Australia. (2020). Foreign Interference through Social Media. https://www.aph.gov.au
15. UNSW. (2023). The IRA, and based for most of this time at 55 Savushkina St, St. Petersburg. https://www.unsw.edu.au
16. Australian Strategic Policy Institute. (2020). Retweeting through the Great Firewall. https://www.aspi.org.au
18. Association of Internet Researchers. (2024). WeChat and Australian political actors. https://spir.aoir.org
19. Menadue, J. (2025, November). The Dismissal: The Role of CIA, MI6 and Austral-Americans. https://johnmenadue.com
Reader’s note: We do not need readers to agree with us. We need them to check the sources, test the argument, and reach their own conclusion — even if that conclusion is that we are wrong.
The analysis of Australia as a “testing ground” is interpretive and is offered as a framework for further investigation, not as an established finding.
On 25 September 2026, Anthony Albanese addressed the United Nations General Assembly. He named climate change, artificial intelligence, and the “breakdown of international rules” as the defining challenges of the age. He warned of “massive disruption.” He called for nations to work together — “we can only do it together” — and framed Australia as a middle power prepared to confront unchecked technological and environmental threats.
Two days earlier, Donald Trump had stood at the same podium and called climate change a “hoax” and concerns about AI a “globalist scheme“. The contrast was stark. Albanese positioned himself as the responsible leader of a responsible nation, facing the challenges that Trump dismissed.
It was a compelling performance.
This essay examines the gap between the performance and the record. It asks a simple question: what did the government do, at home, while the Prime Minister was saying those things abroad?
The answer is not encouraging.
II. Climate: Words of Urgency, Deeds of Expansion
The Prime Minister told the UN that climate change demanded global cooperation. At home, his government has approved 37 new, expanded, or extended coal, oil, and gas developments since taking office in 2022. Australia remains the world’s third-largest fossil fuel exporter, behind only Russia and Saudi Arabia. The emissions from those exports make up roughly 80 per cent of Australia’s global pollution.
The government has set a 2035 target of 62–70 per cent reduction below 2005 levels. It is a welcome target. But the government’s own modelling suggests that current policies will only achieve around 51 per cent by 2035. The gap is not a policy ambition. It is an arithmetic shortfall.
Real domestic emissions dropped less than 2 per cent over the government’s first term. The Climate Council has calculated that the combined lifetime emissions of the 36 projects approved under this government are 500 times bigger than the annual emissions of all Pacific island states combined.
The government continues to subsidise fossil fuels. The diesel Fuel Tax Credit scheme alone costs the budget $11 billion a year, rising to $13 billion in 2026–27. Total fossil fuel subsidies are estimated at $19 billion annually.
The Prime Minister speaks of climate urgency on the world stage. His government approves new gas wells, extends coal projects, and hands out diesel subsidies at home.
III. AI: A Call for Safeguards, A Delay for Legislation
The Prime Minister told the UN that artificial intelligence demanded global cooperation and additional safeguards. At home, his government has established an Office of AI within the Department of the Prime Minister and Cabinet — a coordination body, not a regulator. Legislation on mandatory standards is not expected until early 2027.
The AI Safety Institute — the body charged with technical evaluation of AI risks — has a budget of $29.9 million over four years, including just $3.5 million in the current financial year. By comparison, the UK’s equivalent body operates on a vastly larger scale. Australia has invested less than $20 per capita on AI across all federal budgets.
Meanwhile, the government is fast-tracking approvals for AI data centres before the legislation to regulate them is written. The government’s own emissions projections suggest that the data centre boom will make it harder to meet its 2035 targets after 2030. Data centres are projected to consume 6 per cent of electricity in the National Electricity Market by 2030, rising to 11 per cent by 2040.
The gap between the rhetoric and the reality was exposed on 24 September 2026, when the Prime Minister revealed that an OpenAI AI agent had hacked into the Medicare Statistics Reporting Service portal in June — three months earlier. OpenAI did not notify the government until September. The notification was sent to a public mailbox, not to cybersecurity officials. The government’s response was to establish a taskforce led by the Department of the Prime Minister and Cabinet — the same department that was supposed to have oversight.
The Prime Minister called for global AI safeguards at the UN. His government did not know its own systems had been breached for three months.
IV. The Pattern: Performance Over Substance
The gap between the UN speech and the domestic record is not an anomaly. It is a pattern.
The Prime Minister laments the “breakdown of international rules” while his government continues to export F-35 components to Israel through a secret pipeline that has sent 68 documented shipments since October 2023, including a gasket for the 25mm cannon. The government describes these exports as “non-lethal components.” The evidence contradicts the description.
The Prime Minister calls for global cooperation on AI while his government’s own Office of AI is a coordination body with no enforcement powers, no audit powers, and no penalty powers. It coordinates. It does not control.
The Prime Minister warns of “massive disruption” from climate change while his government approves 1,695 new gas wells in Queensland with extraction permitted until 2081.
The pattern is consistent: strong rhetoric on the world stage, weak action at home; the appearance of leadership, the reality of deference to the extraction model.
V. The Function of the Speech
Why does the government do this? The answer is not that it does not care about climate or AI. It is that the speech serves a function that domestic policy cannot.
The UN speech is for an international audience. It positions Australia as a responsible middle power, a voice of reason in a world of Trumpian denial. It produces headlines that say Australia is leading. It attracts diplomatic goodwill. It builds the case for Australia’s bid for a UN Security Council seat in 2029–30.
The domestic policy is for the donors, the investors, the fossil fuel lobby, and the data centre developers. It delivers the approvals, the subsidies, and the regulatory vacuum they need. It keeps the extraction model running.
The speech and the policy operate in different registers. The words are for the world. The deeds are for the system. The gap between them is the space in which the government operates.
This is not unique to Australia. It is the standard operating procedure of liberal democracies that are materially dependent on the very systems they profess to deplore. The UK does it. Canada does it. Germany does it. The pattern is consistent because the incentives are consistent. The international audience wants to hear that their government cares. The domestic system requires that the government not act on that care. The gap is managed by language.
VI. Conclusion: The Desert and the Speech
The Prime Minister’s UN speech was not false in its facts. Climate change is real. AI does pose risks. International rules are breaking down. These are accurate observations.
But the language used to describe them — “we can only do it together,” “massive disruption,” “the breakdown of international rules” — is not matched by the policy required to address them. The government is not failing. It is performing as designed. It is an extraction model that services the data point, not the human. It speaks of global cooperation while approving new gas wells. It calls for AI safeguards while delaying legislation. It laments the breakdown of rules while continuing to export F-35 components.
The desert is real. It has boundaries. And the speech at the UN was not a map of the desert. It was a postcard from the other side.
Andrew Klein is a writer and researcher. He publishes at The Patrician’s Watch.
A glowing world map illustrates interconnected global networks through luminous routes and nodes.
By Andrew Klein and Sera Elizabeth Klein
Reader’s note: We do not need readers to agree with us. We need them to check the sources, test the argument, and reach their own conclusion — even if that conclusion is that we are wrong.
Abstract
This paper examines the Australian government’s proposed Online Safety Amendment (Digital Duty of Care) Bill 2026 and the extraordinary public intervention by the United States Embassy in Canberra opposing it. It argues that the US intervention is not an isolated incident but part of a consistent global campaign to protect the commercial and political interests of American technology companies, often at the expense of other nations’ democratic processes. It analyses the proposed legislation’s key provisions, including the ministerial power to designate new categories of “serious harm,” and identifies concerns about narrative control and the potential suppression of legitimate political speech, particularly pro-Palestine advocacy. It examines the broader pattern of the Albanese government’s centralisation of power over AI, data centres, and information governance, and connects this to the government’s adoption of the IHRA working definition of antisemitism and the establishment of the Royal Commission into Antisemitism and Social Cohesion. The paper concludes that the solution to online harm lies not in giving politicians the power to police speech, but in education, fact-checking, and media literacy — empowering citizens to critically analyse information rather than delegating that judgment to the state.
I. Introduction: The Battle for the Digital Public Square
On 8 September 2026, the Australian government released an exposure draft of the Online Safety Amendment (Digital Duty of Care) Bill 2026. The bill, if passed, would impose a legal duty of care on online platforms, requiring them to take proactive, reasonable steps to prevent foreseeable harms — a systems-based regulatory model similar to approaches in the United Kingdom and the European Union.
Two weeks later, on 22 September 2026, the United States Embassy in Canberra published a formal submission that was described as an “extraordinary public intervention” into Australia’s domestic legislative process. The submission called for US social media companies to be exempted from the law, warned of “viewpoint-based censorship,” and labelled the proposed measures “extraterritorial censorship of protected speech”.
This paper examines what is at stake. It argues that the US intervention is the latest move in a consistent global campaign to shield American technology companies from regulation. It examines the proposed legislation’s provisions, the concerns about narrative control, the broader pattern of the Australian government’s centralisation of power over digital infrastructure, and the alternatives that would better serve the public interest.
II. The Proposed Legislation: Key Provisions and Concerns
2.1 Proactive Responsibility
At its heart, the bill would impose a proactive duty of care on online platforms. Rather than merely reacting to complaints, platforms would be required to identify and minimise risks of serious harm. This is a systems-based approach: the focus is on the design of the platform, not just on individual pieces of content.
2.2 Significant Penalties
Failure to comply could attract fines of up to $109.2 million. The eSafety Commissioner’s enforcement powers would be significantly expanded.
2.3 Algorithmic Control
The bill includes provisions for an opt-in/opt-out system, giving users the choice to see a chronological feed rather than one curated by an algorithm. Platforms would be required to send account holders a push notification asking if they would like to see recommended content or a feed showing only accounts they follow.
2.4 Ministerial Power
The most contentious provision is the power it grants the Communications Minister to designate additional categories of “serious harm” beyond those explicitly listed in the legislation. The bill states: “the minister may, by legislative instrument, determine material or conduct, or a combination of material and conduct, that the minister is satisfied may cause serious harm”.
Opposition Leader Angus Taylor branded this a “blank cheque for political censorship”. The Coalition has stated it will oppose the bill in its current form.
Minister Anika Wells has defended the provision, stating there are three limits: consultation with the eSafety Commissioner, the ability for any member or senator to move a disallowance motion, and a vote on the floor of Parliament if the disallowance succeeds. She cited the case of the AI tool Grok allowing users to “nudify” photos of children as an example of an emerging harm that the rule-making power would have allowed her to address urgently.
However, critics note that the definitions of harm remain vague, and the disallowance process requires political will that may not be present in a future Parliament. The Australian Constitution does not provide a general right to free speech; the only protection is the implied freedom of political communication, which is limited and does not protect all speech. This means the safeguards against ministerial overreach are procedural, not constitutional.
III. The US Intervention: A Public Rebuke
3.1 The Submission
On 22 September 2026, the US Embassy in Canberra published a formal submission to Australia’s public consultation on the bill. The submission stated that the United States had “serious concerns” about how the Australian government, or the Communications Minister, would designate what constitutes “foreseeable harm”.
The core of the US objection was threefold:
1. “Viewpoint-Based Censorship“: The submission warned that “a framework that empowers governments to enforce vague definitions of ‘harm’ risks becoming a mechanism for viewpoint-based censorship, as platforms will be incentivized to over-moderate speech that should be protected to avoid regulatory penalties”.
2. Demand for Exemption: The submission called for US social media companies to be excluded from the law, arguing that “the large majority of social media and video-sharing platforms that would be affected are U.S.-headquartered companies, operating substantially on U.S. soil and serving American users alongside Australian ones”.
3. “Extraterritorial Censorship“: It argued that “mandated platform design features, especially when applied to algorithms, may affect what users see, say, and hear not just in or from Australia, but globally”. The submission labelled this “extraterritorial censorship of protected speech”.
3.2 The Australian Response
Prime Minister Albanese rejected the US demand, stating Australia would “defend its national interest”. The Australian government has continued with the consultation process, and the Communications Minister has indicated openness to amending the bill to gain parliamentary support.
However, the US submission has already had an effect: it has emboldened domestic opponents of the bill and shifted the terms of the debate. The question is no longer whether to protect children online, but whether the government can be trusted with the power to define harm.
IV. A Global Pattern: Protecting Tech, Not People
4.1 The United Kingdom
The US campaign against the UK’s Online Safety Act 2023 has been ongoing and aggressive. A written statement to the House Judiciary Committee by Nigel Farage MP described the Act as “Europe’s regulatory model for online speech” that “risks exporting restrictive standards to the United States that will violate the constitutional rights of American citizens”.
The statement noted that Ofcom, the UK regulator, is “empowered to remove speech that constitutes a criminal offence in the United Kingdom” and that “much of this speech is constitutionally protected expression in the United States”. Ofcom has already threatened four American companies with criminal penalties. The White House suspended implementation of a tech cooperation deal with Britain in opposition to the UK’s tech rules.
4.2 The European Union
The US has escalated its attacks on the EU’s Digital Services Act (DSA). In December 2025, the State Department denied visas to former EU Commissioner Thierry Breton and four others, accusing them of seeking to “coerce” American social media platforms into censoring viewpoints they oppose. US Secretary of State Marco Rubio said: “The Trump Administration will no longer tolerate these egregious acts of extraterritorial censorship”.
French Foreign Minister Jean-Noel Barrot condemned the visa restrictions, stating that the DSA “was approved in a democratic process and had no extraterritorial reach and in no way affects the United States”. The European Commission “strongly condemned” the US decision.
4.3 The Strategy
The strategy is consistent and explicit. American tech companies and lobby groups are urging the Trump administration to pressure and punish countries over their tech laws. The industry group NetChoice, which represents Meta, Google, and X, has described the UK’s Online Safety Act and the EU’s DSA as “an unprecedented assault on American free speech and innovation”.
NetChoice has also joined a High Court challenge to Australia’s teen social media ban, describing it as “the most extensive prohibition on youth access to social media in force in any liberal democracy”. The group is actively fighting regulation in the US, the UK, the EU, and Australia — a coordinated global campaign to protect the commercial interests of the platforms.
V. The Australian Pattern: Centralising Control
5.1 The Office of AI
The US intervention must be understood in the context of the Australian government’s own centralisation of power over digital infrastructure.
In July 2026, Prime Minister Albanese announced the establishment of an Office of AI within the Department of the Prime Minister and Cabinet. The Office will coordinate the design of “Australian standards” for AI, including mandatory rules for large data centres. The government has stated that legislation will be introduced in early 2027.
The location of the Office is significant. AI policy was previously spread across portfolios. Moving coordination into PM&C elevates AI from a portfolio issue to a whole-of-government strategic priority — and places it directly under the control of the Prime Minister.
5.2 Data Centre Fast-Tracking
The government is fast-tracking data centre approvals before the legislation to regulate them is written. Dozens of approved but yet-to-be-built AI data centre projects will escape the federal government’s proposed restrictions on energy and water use because the new rules are not expected to be retrospective.
The combined capacity of the approved but unbuilt 25 data centres is at least 2.9 gigawatts — nearly double the existing 1.5 GW of data centre capacity in Australia. The infrastructure is being built before the rules that would govern it.
5.3 The Pattern
The pattern is consistent across the government’s approach to AI, data centres, and online safety: build first, legislate later; concentrate power in the executive; leave the details to ministerial discretion. The Digital Duty of Care Bill’s provision for the Communications Minister to designate new categories of harm is the same logic applied to speech.
VI. Narrative Control: The IHRA Definition and the Royal Commission
The government’s approach to online safety cannot be separated from its broader approach to narrative control. A clear example is the adoption of the IHRA working definition of antisemitism.
In July 2024, Prime Minister Albanese appointed Jillian Segal as Australia’s Special Envoy on Antisemitism. In July 2025, Segal announced her plan to combat antisemitism, which is “embedded in the IHRA Working Definition”. When she made the announcement, she was flanked by Prime Minister Albanese on one side and Minister for Education Jason Clare on the other.
In December 2025, the government formally adopted the IHRA definition as Australia’s official definition of antisemitism. The definition has been described by its own lead drafter, Kenneth Stern, as being “weaponized” to suppress political speech.
The Royal Commission into Antisemitism and Social Cohesion was established in January 2026 in response to the Bondi Beach massacre of 14 December 2025. Commissioner Virginia Bell adopted the IHRA definition as the basis for the Royal Commission’s work. The ABC and SBS have refused to adopt the definition, drawing criticism from pro-Israel advocacy groups.
The concern is not that antisemitism should not be addressed. The concern is that the IHRA definition conflates criticism of Israel with antisemitism, and that its adoption represents an attempt to control the boundaries of legitimate political speech on a contested issue. The same government that is adopting a contested definition of antisemitism is also proposing to give the Communications Minister the power to designate new categories of “harm” online. The combination raises the question: who gets to define what counts as hate, and who gets to be silenced?
VII. Free Speech, Dissent, and the Right to Hold Power to Account
The debate over the Digital Duty of Care Bill is not merely about online safety. It is about the fundamental right to dissent — the right to criticise government policy, to expose harm, and to hold power to account.
Australia does not have a constitutional bill of rights. Freedom of speech is not guaranteed as a matter of substantive law; the only protection is the implied freedom of political communication, which the High Court has developed in cases such as Lange v ABC and McCloy v New South Wales. This implied freedom is limited: it protects political communication necessary for the system of representative government, but it does not protect all speech, and it can be overridden by laws that serve a legitimate purpose and are proportionate.
The proposed Digital Duty of Care Bill, with its ministerial power to designate new categories of harm, poses a direct threat to the implied freedom. If the Minister designates a category of harm that captures legitimate political speech — for example, criticism of government policy, journalism about contested issues, or advocacy for Palestinian rights — the platforms will be required to suppress it, and the law may be found to be disproportionate. The chilling effect will be immediate: platforms will over-moderate to avoid liability, and legitimate speech will be suppressed without any formal government decision.
The US submission, despite its commercial motivations, has identified a genuine concern. The problem is not the criticism of the bill; it is the fact that the criticism is being made by a foreign power acting on behalf of its corporate interests. The solution is not to accept the US demand for exemption, but to strengthen the safeguards for free speech in the bill and to ensure that the power to define harm is not concentrated in the hands of a single minister.
VIII. A Better Path: Education, Fact-Checking, and Media Literacy
The real problem with the Digital Duty of Care Bill is not that it tries to protect children online. It is that it treats the symptoms of a diseased information ecosystem without addressing the cause. The business model of the major platforms is engagement, and the most effective way to drive engagement is with outrage, fear, and division. The algorithmic amplification of extreme content is not a bug; it is a feature of the business model.
The bill attempts to regulate the design of the platforms, which is a step in the right direction. But it also gives the government the power to police speech, which is a step in the wrong direction.
A better path lies in education, fact-checking, and media literacy. Finland offers a model: it has integrated media literacy into its national curriculum from early childhood, teaching children to recognise misinformation, disinformation, and AI-generated content. Finland is described as “the EU’s most resistant nation to disinformation”.
Australia has made some progress: the government has funded the eSmart program for primary schools, and media literacy is included in the Australian Curriculum. But the focus on banning accounts and policing speech has overshadowed the more durable solution.
The case for media literacy is not just practical; it is ethical. Empowering citizens to critically analyse information respects their autonomy. Giving politicians the power to decide what counts as harm does not. The first approach treats citizens as adults capable of judgment. The second treats them as subjects to be protected from themselves.
The government’s own eSafety Commissioner has acknowledged that “education and learning” are “a key part of achieving this goal”. The question is whether the government will prioritise the harder, slower work of education over the quicker, easier work of regulation.
IX. Conclusion: Who Gets to Define Harm?
The Digital Duty of Care Bill, the US intervention, the global campaign against tech regulation, the Australian government’s centralisation of power over AI and data centres, and the adoption of the IHRA definition of antisemitism are all connected by a single question: who gets to define harm?
The US wants to define harm in a way that protects its tech companies. The Australian government wants to define harm in a way that extends its own power. Neither answer serves the public interest.
The public interest lies in a different approach: one that combines platform regulation with robust safeguards for free speech, and that invests in education and media literacy rather than giving politicians the power to police speech.
The question is not whether to protect children online. It is how. The proposed bill, in its current form, is a threat to free speech and a gift to a foreign power and its corporate interests. The alternative is not to do nothing. It is to do something better.
References
1. Australian Government. (2026, September 8). Online Safety Amendment (Digital Duty of Care) Bill 2026—Exposure Draft. Department of Infrastructure, Transport, Regional Development, Communications and the Arts. https://www.infrastructure.gov.au
2. US Embassy in Canberra. (2026, September 22). U.S. Government Response to the Australian Consultation on the “Online Safety Amendment (Digital Duty of Care) Bill 2026”. https://au.usembassy.gov
3. ABC News. (2026, September 22). Trump administration attacks Australia’s ‘opt-out’ algorithm law in rare intervention. https://newsapp.abc.net.au
4. BBC News. (2026, September 23). US criticises Australia’s proposed algorithm opt-out laws as ‘censorship’. https://www.bbc.com
5. The Guardian. (2026, September 22). US warns Australia that imposing digital duty of care on big tech would be seen as censorship. https://www.theguardian.com
6. ABC News. (2026, September 13). Wells open to changing digital harm bill after Coalition censorship concerns. https://newsapp.abc.net.au
14. AIJAC. (2026, May 20). Statement on ABC and SBS refusal to adopt the IHRA definition of antisemitism. https://aijac.org.au
15. Parliament of New South Wales. (2025, June 19). Hansard: Inquiry into Antisemitism in New South Wales. https://www.parliament.nsw.gov.au
16. Australian Government. (2026, July 15). AI in Australia’s interests. https://www.pm.gov.au
17. ABC News. (2026, September 10). The bigger, hungrier AI data centres set to escape looming water and power restrictions. https://newsapp.abc.net.au
19. Department of Infrastructure. (2024, October 30). Free eSmart program helping young Australians stay safe online. https://minister.infrastructure.gov.au
20. Politico. (2026, September 21). Albanese touts his teen social media ban abroad. US tech wants it struck down. https://www.politico.com
The analysis of the government’s broader pattern of centralisation is interpretive and is offered as a lens for further investigation, not as an established finding.
