As a result of the inquiry of Mr Paul Volcker into the UN’s Oil for Food Program for Iraq, the Australian Government commissioned an inquiry of its own. Mr Terence Cole QC is investigating Australian Wheat Board involvement in alleged “kickbacks” to Saddam Hussein’s regime. As revelations from the Cole inquiry emerge (this is written in mid-March), serious questions arise: how did Australian interests help turn the UN’s Oil for Food Program into a Wheat for Weapons scam that assisted the Iraqi leader’s war effort? The inquiry‘s terms of reference initially precluded the possibility of calling Government officials to give evidence, and so critics of the Government perceived a cover up. And indeed, although the inquiry is not yet complete, Government ministers have been quick to point to Cole’s early findings and draw attention to failures and even deceit within the ranks of the Australian Wheat Board rather than accepting any negligence on their part.

Let us briefly review the background to this inquiry.

It is alleged that the AWB completed the fraud by recouping the cash payments from the UN and putting itself in the position of collecting other such debts on behalf of other Australian companies. In my view this is an important fact, indicating a high level of corporate confidence on the part of AWB, not only about the role it was playing, but also of the vital importance of the service it was providing - wheat supplies for hungry Iraqis.

These are the facts, some of which are said to be damning, and in media interviews the PM and the Foreign Minister seem confident enough to allow the blame to rest with the AWB and the “deceit” of some of its officials. Such a response by the Government, it seems to me, avoids the problems caused by its own determined effort to justify all foreign policy by an appeal to the national interest. It has not attempted to justify its lack of action in response to UN concerns.

How are we to view the Australian Government’s contribution to this scandal? The Prime Minister, John Howard, says simply “It’s not a problem!” He says he didn’t do anything wrong. But it is an embarrassment for the country. It is not merely an internal AWB matter or a future market problem for wheat growers. Such problems have merely been compounded by the lack of Government action when action was needed. That shame doesn’t go away just because the Cole commission has now documents some failures by AWB officials to provide proper report!

Some might wonder why such a failure to act at the top political level hasn’t led to the resignation of the Government! How do PM and his ministers avoid taking their share of responsibility for what they didn‘t do? After all, when the Government was initially given the UN warnings, it could hardly have expected the Wheat Board to act on its own to change the system? Why didn’t the Australian Government act then to ensure the good name and proper mandate of the AWB and its supply of grain for Iraqis?

First, it’s important to note that whatever the truth may be with respect to alleged misconduct by the AWB, this is a Government of no shame. It bases its confidence in an ability to remain unembarrassed. Its Ministers are confident they can ride out any problems that come their way. The UN warnings had no impact on Howard‘s Coalition Government and now it maintains its unembarrassed stance in the context of Australia’s emerging international shame. It did nothing and it is not embarrassed by the fact.

I am driven to lament with Jeremiah: No, they were not at all ashamed. Neither did they know how to blush (Jeremiah 8:12).

The government is apparently convinced that it has done nothing wrong. My view of this is that the Government was negligent in that it assumed that it didn’t have to do anything other than committing Australian troops to the Coalition. It assumes that the commercial dealings of the AWB in Iraq were not basically its responsibility.

This scandal could well be the complex ball of wax it is because of a "commercial culture conflict" - the term "kickbacks" is regularly thrown around but what does that term mean precisely? Is it not an ex post facto interpretation of the commercial dealings that needed to be contracted in the pre-war, situation under sanctions from a standpoint after the fall of Saddam’s regime. In international law and global commerce there are alternative, competing views as to how a nation's laws operate in a commercial context when a firm is trading beyond the borders. It is highly likely that problems related to extra-territoriality are at work here. The provisional government in Baghdad gave the AWB permission to supply grain in the post-war context. Under what legal regime was the AWB contracted to operate and was it not a different legal set-up from before the war? Could that be part of the confusion?

I’d have to say that there must be serious doubts, as to whether the AWB payments were intended as “bribes“ or sanction-busting “kickbacks“ from the Australian side. Certainly, the failure of the system of sanctions was not caused by the AWB’s provision of massive shiploads of wheat, that also needed to be unloaded and trucked from the port of Umm Qasr. Each ship meant 50,000 tonnes of wheat which then needed to be unloaded into about 1700 trucks @ $1500 ea. But now in the aftermath of the fall of Saddam Hussein, the work of the AWB - along with Volvo, Siemens, Daimler Chrysler and other companies which participated in the Oil for Food programme - are viewed in a very poor light. This then was just another failure of the UN and its programmes. Par for the course. By contrast the Australian Government sees nothing wrong in its own lack of remedial action. My view however is that the problem arises because the Government then and now talks as if it’s involvement by investigating the UN’s concerns would have interfered with the AWB’s operations. That assumes that commerce, even if it is UN Oil for Food commerce, is best left alone. The failure of the Australian Government, the PM and the Foreign Minister and the Minister for Overseas Trade, is the failure of their view of Government in the national interest..

Howard’s success has been his ability to convince enough Australians that the national interest is equivalent to his Prime Ministership. The national interest was his justification for going to war. Talk of justice was not on the agenda then and it still remains off the agenda. The national interest was probably the justification by which the AWB payment schedule was given its initially approval. The national interest is the basis Howard appeals to when he now shamelessly avoids disclosing what he knows. The national interest, not justice, is the basis and agenda of Australia’s foreign policy. Howard is convinced that national self-interest is the source of the nation’s political strength; just as personal self-interest is the key to the health of the Australian economy. Most Australians agree. Such a view of the national interest is shameless and the scandal doesn’t move them one little bit. They say that the real problem (the real challenge to the national interest) arose because AWB got caught. Oh well, they will say, better luck next time! And try to avoid getting involved in useless UN programmes!

This case shows that the national interest should not be ignored; but it is not paramount and is something wider than mere commercial gain. For Government, the national interest should always be determined by deciding what is just. Doing justice, giving to each its due, is the paramount principle that should guide a Government‘s policies. It is a principle that applies in personal life, in public life and in international relations. It is a principle that must be at the forefront of any decision to wage war. It is a principle that must also guide a Government’s economic policies. And when it is notified of possible injustice it has to act or else it becomes complicit. But when it fails to act, as it did in this case, presumably in order to preserve some specious view of the national interest, then indeed everything is turned upside-down. That is why the waging of war and the safeguarding of the ill-gotten electoral and commercial gains that resulted, have become corner-stones of the Coalition’s idolatrous nationalism.

Yes, Australia should hang its head in shame. The Government justified its involvement in the Iraq war by sneering at the United Nations, when it was in fact failing to adequately investigate claims that an Australian company was ripping off the UN. The guilt from this scandal can not be explained solely in terms of failures within the AWB. It is something much wider, much more profound. It will not go away without Australia as a nation admitting the shame and taking another path, a path that seeks to rediscover her responsibility in the world by facing up to her shame, by repenting of the injustices she has helped to perpetrate and by putting justice ahead of self-interest.

What this scandal illustrates is a serious problem of governance when “national self-interest“ becomes paramount for Government conduct in the international arena. Government’s actions or inactions have consequences for the way a nation’s businesses and corporate organisations conduct themselves, not only at home but on the international stage. This Government justifies itself in terms of what it did not know and did not do, but its lack of action was based on some commitment. It seems that it thought that by ignoring the problem it was acting in the “national interest”. Now, having not investigated and not acted, it has been content to have the AWB “carry the can“. But the shame is much bigger. Ironically, the Government’s determination to appear unembarrassed confirms the shame of it.