I recently had a disagreement with two well connected ALP friends over Sam Dastyari’s resignation/sacking.
They thought Dastyari’s resignation was brought about by a media “witch-hunt” and that he had committed no breach that justified his removal or resignation from Parliament. I thought he had to go.
First, let’s understand the South China Sea issue that Dastyari fell into strife over and then chronology of the relevant events that led to his resignation:
What is the South China Sea dispute all about?
The South China Sea is of tremendous strategic importance. One-third of the world’s shipping passes through it, carrying over $3 trillion in trade each year. It contains lucrative fisheries that are crucial for the food security of millions in Southeast Asia. Huge oil and gas reserves are believed to lie beneath its seabed. China has been involved in conflicts with its neighbours, including Vietnam, the Philippines, Malaysia, Brunei, and Taiwan over rights in the Sea.
Since 2012, China been using its considerable naval might to assert control over the area it claims. It has seized small land formations and installed military bases on artificial islands it has created by dredging 13 square kilometres of land from the ocean floor. China wants to create an exclusive economic zone (EEZ) in most of the South China Sea. An EEZ would provide China with sovereign rights for exploring, exploiting, and conserving natural resources in the EEZ and jurisdiction with regard to activities such as “marine scientific research” and “the protection and preservation of the marine environment’.
China asserts that military activities are not permissible in a coastal state’s EEZ without prior permission. Only 27 other countries in the world agree with this position. States known to operate military vessels in foreign EEZs without notice include the United States, Russia, Australia, South Africa, the United Kingdom (U.K.), and, ironically, China. Australia and South Africa both conduct military activities in foreign EEZs throughout the Pacific without coastal state consent.
In 2013, the Philippines filed a case against China in the Permanent Court of Arbitration in the Hague, seeking a ruling on its sovereign rights in waters near islands and reefs it occupies which it said China had infringed by interfering with fishing and petroleum exploration. China conducted military drills in the waters in the run up to the case and the USA has conducted “freedom of navigation” exercises in the area.
On 12 July 2016, the Court rejected China’s claims over almost all of the waters in the South China Sea. The Court rebuked China on everything from its interference in its smaller neighbour’s fishing to the environmental devastation wrought by its large-scale construction of islands on fragile coral reefs. The tribunal threw out China’s “nine dash line” which asserts the country’s claim to most of the South China Sea based on “historic rights”. The Court held that the United Nations Convention on the Law of the Sea (UNCLOS) is the prevailing law. The Court did not “…rule on any question of sovereignty over land territory and would not delimit any maritime boundary between the Parties”. But applied to the South China Sea, the law basically gives each country rights to the sea up to 200 navigable miles from its coastline with the remainder classed as international waters.
China announced it would not accept the Court’s ruling.
Both China and the USA have engaged in aggressive actions in the South China Sea. In five years the Chinese have built 12 militarily significant facilities in the South China Sea including three military fighter bases towards the centre of the sea, each with protected facilities for 24 fighter-bombers. The US has sent warships and submarines into close proximity to islands occupied by China whether China protests or not.
Yet both countries seem to have an abiding economic interest in peace in the region.
Chronology of Dastyari actions
In 2015 ASIO director, Duncan Lewis, cautioned both major political parties about taking donations from Mr. Huang Xiangmo on the basis of his suspected relationship with the Chinese Communist Party. Both the Coalition and Labor continued to accept money: As of June 2017, the Coalition had since received $897,960 and Labor had taken $200,000.
In February 2016, current ALP shadow foreign minister, Tanya Plibersek, clearly set out the ALP’s policy in support of international law, a rules based international order and for all parties to abide UNCLOS in the South China sea (see more below).
On 12 July 2016, the Permanent Court of Arbitration in the Hague rejected China’s claims over almost all of the waters in the South China Sea (see above).
Soon after the Court’s ruling, Labor’s then defence spokesperson, Stephen Conroy said that Australia will have “failed the test” of supporting international law and order unless it stood up to China’s “bullying” behaviour in the South China Sea.
On 17 July 2016, after Conroy had made his comments, Dastyari appeared in a press conference with Mr. Huang and defended China’s actions. There seem to be conflicting media reports as to whether this press conference occurred on 17 June or 17 July 2016. But the later reports say the date was 17 July. In any event, the Australian media wasn’t invited to the press conference and the only initial record of Mr Dastyari’s comments was through Chinese media reports. A ‘Four Corners’ report from June 2017 claimed Mr. Huang contacted the ALP indicating that a promised donation of $400,000 would not proceed in light of Conroy’s comments. The same program reported that Mr. Huang denies any links between his donations and foreign policy outcomes.
On 30 August 2016, it was revealed that the Top Education Institute — a Chinese higher education provider — had paid Dastyari’s $1670.82 excess travel bill. Dastyari subsequently admitted in parliament that he should have paid the bill himself.
On 31 August 2016 the ‘Financial Review’ first published allegations about Dastyari’s press conference with Mr. Huang. The report stated that “Dastyari assured the Chinese community he would respect China’s stance on the South China Sea, according to articles in the Chinese media.”
On 8 September 2016, it was reported that, due to the payment by the TOP Institute of his travel expenses, Dastyari had stood down from the Labor front bench where he had been manager of opposition business in the senate, and shadow minister for consumer affairs. Dastyari apologised for allowing TOP to pay off the travel debt he owed to the Commonwealth. There is not really much doubt that Dastyari was put on a “final warning” by Bill Shorten at this time. Shorten’s exact words were that Dastyari had made a mistake but “deserved a second chance”.
In October 2016, Dastyari met with Huang at the businessman’s Sydney mansion and told him they should leave their phones inside while they spoke outside, warning him his phone may be tapped.
In July 2017, Dastyari told ‘Australian Story’ that he made comments attributed to him defending China’s position on the South China Sea only after he had “questions thrown at me from the Chinese media…It was later reported that, in a very garbled answer, I said something along the lines of ‘that’s a matter for China’. I gave the wrong answer to a complicated foreign policy question that I was naive enough and perhaps silly enough to take. What I should have done is taken it on notice or got them a proper answer. What I tried to do was give an answer at a press conference. That was the wrong thing to do. I’m not the first, I certainly won’t be the last Member of Parliament to take a question and give the wrong answer.” He went on to say of the answer that he had “mumbled it and answered it incorrectly”. He also emphasised that any warnings about Huang made by ASIO had never been passed onto him.
In late November 2017, a tape with full audio of the Dastyari-Huang press conference surfaced. The tape revealed Dastyari’s statements at the press conference sounded careful, deliberate and scripted. In the recording, Senator Dastyari states clearly that “the Chinese integrity of its borders is a matter for China”. He then refers to China’s historical defence of its land claims, and how Australia and Labor policy should approach the issue. “And the role Australia should be playing as a friend is to know that with the several thousand years of history, thousands of years of history, where it is and isn’t our place to be involved…And as a supporter of China and a friend of China the Australian Labor Party needs to play an important role in maintaining that relationship and the best way of maintaining that relationship is knowing when it is and isn’t our place to be involved.”
On 30 November 2017, Dastyari himself made no attempt to defend the initial account he had given of the press conference. In a statement to the Senate he said that the tape “shocked” him, as it did not match his recollection of events.
On 8 December 2017, Bill Shorten stated that Dastyari’s career was “going nowhere fast.”
On 9 December 2017, the ‘Saturday Paper’ reported that “Senior Labor Party figures believe ASIO leaked the audio of Sam Dastyari’s 2016 press conference in front of Chinese media, but possibly did so following pressure from a disgruntled USA.”
On 12 December 2017, Dastyari announced he would quit the Senate, guided by his Labor values and to prevent further damage to the party.
My friends argued that, having been demoted from the front bench, Dastyari had “paid the price” for having had his travel bill paid by the TOP Institute. They acknowledged that this was inappropriate conduct. But they argued that nothing Dastyari had said or done in relation to the South China Sea was sufficient to justify his removal as a Senator.
They pointed out that it not uncommon for politicians to express opinions contrary to ALP policy. They also claimed China still has a valid argument in its position on the South China Sea.
Warnings, lies and cover ups
The first problem with this analysis is that seeks to treat two incidents as entirely separate rather than as an accumulation of breaches by Dastyari.
This approach suggests that politicians should be held to a standard that is lower than is typically applied to workers when they receive a final warning in the workplace. As elected representatives, rather than as employees, perhaps this is so. Yet unsurprisingly, this is not a position many politicians wish to defend publicly.
When a worker receives a final warning for misconduct any significant subsequent misconduct generally results in dismissal being regarded as fair. Bill Shorten stated that Dastyari had made a mistake in having his travel bill paid but “deserved a second chance”. Dastyari’s conduct in holding the press conference with Huang came before Shorten’s warning in relation to the payment of his travel expense. But his mischaracterisation of what he said at the press conference came afterwards. Further, there are only two possible explanations for his mischaracterisation- memory lapse, or lying. The deliberate and scripted nature of the comments means that the later is clearly the more likely explanation.
Is it a sacking offence for a politician be caught lying? Not always. Lying is somewhat of an occupational hazard in politics. But where possible lying is to be avoided. The truth is nearly always easier. And if you get caught lying you must be prepared to pay the consequences. If you are already on a warning you should expect those consequences to be worse.
Ironically, it is perhaps easier to get away with lies involving failure to deliver upon policy commitments because this is half expected. As always, it is the blatantly self interested “cover up lie” which does the most damage. And this was the nature of Dastyari’s lie. Had Dastyari been honest about his comments at the Press Conference, acknowledging they were contrary to party policy and signalling a future willingness to restrict his arguments to party forums, his chances of surviving would have been much better. He only has himself and his own arrogance to blame for choosing to try and cover up the true nature of his comments in the press conference by insisting that they were some kind of unscripted, naïve, silly error.
No defensible legal argument for China
The second problem is that China’s arguments to control almost the entirety of the South China Sea have already been rejected by the relevant international tribunal in The Hague. Labor has a long history of support for international law and the international tribunals responsible for enforcing determining it. Of course China is not the only great power to ignore international law. In 1986 the USA refused to abide a decision of the International Court of Justice brought against it by Nicaragua, not to mention breaches of international law associated with its intervention in Iraq. And the USA has not even ratified the United Nations Law of the Sea Convention (UNCLOS).
Although the United States was an original architect of the treaty, US Senate consent to ratification has remained stalled through three successive presidential administrations. Nevertheless customary law does bind the USA and it is largely the same as the law reflected by the UNCLOS treaty.
In some parts of the body politic, including the left, there is a tendency to ignore Chinese transgression. Sometimes this is because China is an important trading partner to Australia. Sometimes it is because China is not the USA. Her emergence spells the end of US unipolar power and this is regarded as positive (I agree). Sometimes it is because Chinese actions in the South China Sea are regarded as purely reactions to US military activity in the region and/or the US’s failure to accord China rival superpower status in the region. This latter reason ignores the perspective of other countries in the region. For example, Nguyen Hong Thao , Assistant to Professor in Law at the National University of Hanoi, has written:
“The land reclamation made by China on the low tide elevations (LTE) far from the Chinese mainland…has occurred at a very fast pace and huge scale… China uses the biggest dredge ships in the world to destroy the coral reef ecosystem for extracted material. This damages over 300 hectares of coral reef, creating initial loss of more than $100 million every year for countries in South China Sea, in addition of course to the damage to the environment which. And as many others have pointed out, China’s transformation of LTEs into artificial islands, followed by demands by the international community to give them the legal status of natural islands and recognize an exclusive economic zone, violated UNCLOS which China is a party to…these LTEs …are designed to be military bases equipped with heavy guns, ports and airfields…These bases can serve as departure points for Chinese coast guard, navy, and fishery inspection forces to drive away, shoot, loot and rob Malaysian, Filipino, and Vietnamese fishing boats, all the while slowly establishing a ban on fishing in the area and advancing the nine-dash line claim in the South China Sea…China’s bases are clearly of an offensive nature and threaten regional peace and stability. This is why the United States, the G7 and other countries have felt compelled to protest.”
Australian Governments, and Labor politicians, have not always been consistent in support for international law or its tribunals. The Howard government resisted East Timor’s efforts to refer its dispute with Australia over gas and oil in the Timor Sea to the International Court and at the 2004 ALP national conference Kevin Rudd insisted on an amendment committing Labor to submitting to International Court jurisdiction being withdrawn. But in February 2016, current shadow foreign minister, Tanya Plibersek, clearly set out the ALP’s policy on these issues, including a change in the approach to East Timor. She wrote:
“The rules-based international order has brought so much benefit to our country, and we should act to maintain and support that system. But we cannot expect other nations to adhere to a system we do not ourselves uphold. On whaling, on the settlement of international trade and maritime disputes, on French nuclear testing in the Pacific, we have insisted others play by the rules. On the overlapping maritime claims in the South China Sea, we urge all parties to abide by both the terms and the spirit of the UN Convention on the Law of the Sea. Australia has a good record of acting in defence of this system, but not a flawless one.
Australia’s key role in securing independence for East Timor was a proud moment for our nation. But we have allowed the maritime boundary dispute to poison relations, and Labor will change this. We announced earlier this year that a Labor government will intensify efforts to conclude good faith negotiations with Timor-Leste to settle the maritime boundaries between our two countries. If we are not successful in negotiating a settlement with our neighbour, we are prepared to submit ourselves to international adjudication or arbitration. It is in the national interest of both countries that we do so.”
Dastyari’s comment that the Chinese integrity of its borders is a matter for China was misleading. China is not merely trying to protect its existing borders but is effectively trying to extend them contrary to international law and the interest of its Pacific neighbours. In making his comments at the press conference in July 2016, Dastyari completely ignored ALP policy as it had been set out in the public comments of both responsible ministers- Plibersek and Conroy.
It is difficult to believe that Dastyari acted out of an incompetent ignorance of Labor’s position. The ‘Labor values’ he cited in his resignation seemed lacking when he took the actions he did. This was both in his decision to contradict ALP policy on a sensitive issue, outside his shadow portfolio responsibilities, and, more importantly, in the substance of his comments- these put China’s perception of its national interests ahead of Labor values in support of international law and Australia’s interest in promoting a rules based international order.
Dastyari had been a very effective advocate in raising issues about banks and multi-national tax avoidance. So we are left to wonder how a person with his ability took the course that he did. In my view the most likely explanation is arrogance combined with a failure to outgrow a legacy which stayed with him from the time when he was responsible for party fund raising, a legacy that stemmed from the need to ingratiate potential donors. The potential alternative explanations seem even less edifying.