Into the underbelly of the beast

'Betrayal'Non-fiction review
Betrayal: The Underbelly of Australian Labor
Simon Benson

Paul Keating famously said, ‘where goes NSW, so goes federal Labor’. I read Betrayal: The Underbelly of Australian Labor before the federal election, and watching the drama unfold I have to say it was a prescient read.

Simon Benson, Chief political reporter for the Daily Telegraph focuses on the fall of Morris Iemma as NSW Premier and his ill-fated attempt to privatise the NSW electricity supply. His forensic examination of the Iemma government, including the machinations of the faceless apparatchiks that really run Labor, as well as the factions and unions, throws a revealing light on federal Labor.

The privatisation of NSW’s electricity supply was a contentious issue during Morris Iemma’s reign as premier. Traditional Labor, especially the unions, have always been opposed to privatisation, as have I. Benson though, through the arguments of Iemma and Costa, makes it seem crucial that the electricity supply be privatised.

NSW was facing a financial and social crisis. NSW had grown at a rapid rate and there was no longer the infrastructure to support the growing population, let alone the projected growth. Roads, hospitals, railways, water and electricity supplies were on the verge of collapse and there was no money to repair anything. The solution was to sell Pacific Power (NSW’s power company) and use the money to bankroll the upgrading and repairs to other infrastructure programs. The choice is presented as do that or do nothing and let NSW slide into the sort of infrastructure dysfunctionalism commonly seen in developing countries.

Given the scenario painted, privatisation seemed to be the only solution. Thus Iemma and Costa pushed it vigorously. The unions opposed it, as did many in the ALP, and therein lies the rub for an ALP Premier.

Betrayal begins as Sydney is immersed in the APEC conference, with Rudd stealing the show from Howard and showing his credentials to be the next PM (and The Chaser team stealing the show from Rudd). Iemma is on the verge of announcing the privatisation of the NSW power supply, ensuring a shit fight with the unions and many in the ALP. Rudd is terrified Iemma’s announcement will derail his election campaign and make the ALP on the nose for many constituents.

As far as Rudd was concerned, Iemma was about to snatch the golden apple from his grasp and toss it out the window. Rudd pleaded with Iemma to hold off, to not announce his privatisation bill until after the federal election: ‘If you help me, I’ll get elected and you will prosper. Work with me and, when the time comes, we can fuck them together.’

Iemma agreed – as long as Rudd was committed to the national executive vetoing any state conference defeat of Iemma’s policy.

But the promise was broken by Rudd and Benson telegraphs this fact throughout the book, so much so that when he gets to the point where Rudd does break his promise it’s anti-climactic.

What is fascinating about Betrayal is watching the machinations of the factions squeeze the life out of Iemma. The acquisition of power has become the raison d’etre for the NSW ALP, as opposed to governing the state and ensuring that people have a good quality of life. It becomes clear that the privatisation of the power supply is a furphy in terms of the attacks against Iemma from those within his own party. Iemma was pilloried because he refused to do what he was told and therefore the unions and factions felt they no longer controlled him.

There is some merit in this, of course. A leader is made a leader by the party to some extent and so should be accountable to the party. But there is a difference between being made accountable and being a puppet with a number of different powerful interests pulling the strings. At the end of the day, the ALP is not an anarcho-syndicalist organisation with Iemma being a recallable delegate. It is an organisation that elects its leader by virtue of his or her ability to lead. It seems that many in the ALP treated Iemma like he was a recallable delegate, a fact painfully illuminated in the NSW State Labor conference where the unions and factions manoeuvred to depose Iemma while Iemma waited in vain for Rudd to save him.

It’s possible that Iemma could have weathered the storm, or marshalled the forces to defeat the motion he knew was coming. But Iemma was a premier whose resilience had been whittled away by a series of scandals that rocked NSW Labor. Milton Orkopoulous and his paedophile drug ring, Iguanagate, Della Bosca and his affair, Nathan Rees and the allegation of domestic violence and so on. Much of Iemma’s time was taken up managing a series of fuck-ups from his ministers rather than campaigning and outlining coherent arguments for privatisation. That was left to Costa, who was unwaveringly loyal to Iemma and who had been championing privatisation for years. Costa is a highly intelligent and driven man but he has poor people skills and tended to get people offside quickly and permanently. He had no chance of convincing anyone of the merits of privatisation. Thus by the time the state conference came about the unions had been exerting pressure on members of Iemma’s government (in a very threatening and vicious manner, according to the book) and the factions had been undermining Iemma at every opportunity. He had no chance.

The ringmasters of the circus of NSW Labor were Mark Arib, general secretary of NSW Labor, and Karl Bitar, assistant general secretary – both from the right. They were a star chamber of two who engineered the rise and fall of MP’s in the NSW ALP, including the short-lived premiership of the inexperienced and incompetent Nathan Rees, who took over after Iemma had been ‘executed’. These two men were the shadowy operatives who really ran NSW Labor – forget the unions, forget the factions. These men played all parties to get their own ends.

Soon after installing Rees as Premier, Bitar resigned as NSW party boss to take over as Rudd’s new campaign director. Upon hearing this news, Frank Sartor sent a text to Bitar: ‘Congratulations on the new job. Now that you’ve fucked up NSW, you can go and fuck up the country.’ Which is exactly what he did, overseeing perhaps the biggest swing against a first-term government in Australian political history and giving the ALP not an election win, but a stitched together deal that has them treading water in the rough sea of politics. Time will tell if their governance survives. Mark Arbib went federal before the election and Rudd made him Minister for Employment participation. By all accounts, he skulks around the halls of Canberra crunching numbers and doing deals. You can bet your vote that Bitar and Arbib had a big part in deposing Rudd, and if Gillard is also executed, it’ll be their hands that swing the axe.

For anyone interested in modern Australian politics this is a great read. For anyone who wonders what the hell happened to the ALP – the party once supposed to be there for those less fortunate, a party of compassion and hope that has become a facsimile of the Liberal party – this is a crucial read. It’s obvious that what happened in NSW is a microcosm of what’s going on with the ALP federally.

Read it and look into the future.

Rohan Wightman

Rohan Wightman is a Darwin-based writer & teacher. He’s been shortlisted for the NT literary awards four times, including this year. He has been published in Going Down Swinging and has been shortlisted in a few other writing comps and won a few less well-known comps. He started writing when he was young but really hit his stride when writing for Squat It, the magazine of the Squatters Union of Victoria, in the late 80s. He has piles of manuscripts but no publisher. His under construction website is

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  1. I find it amazing, from what I’ve read of the book, that Benson can present electricity privatisation in NSW as a fait accompli at the same time that the Rudd Government made the implementation of an emissions trading scheme its first term priority. Did anybody ever bother to gauge market interest in acquiring some of the least efficient coal-fired power stations in the world at the time of such uncertainty about the potential commercial returns? Benson’s book would be better if he interpreted Iemma’s downfall with less tragedy and more farce.

  2. Rohan, I have not read Benson’s book but I question his pro-privatisation arguments. Liz Humphrys & I moved to set up the NSW Greens anti-privatisation committee before the crisis started, and then worked closely with upper house MP John Kaye to get the Greens to push the anti-privatisation argument and work alongside unionists and ALP members. Our position was supported not just by a few factional or union heavyweights but 85% of NSW citizens (according to more than one poll), and John was a shining beacon of clarity on the issue.

    There were many good reasons to oppose privatisation. The most important was that the main argument put by Benson (and Iemma) was false. Successive privatisations and PPPs in NSW actually contributed to the run-down of public services because they destroyed sources of recurrent revenue and often involved state subsidy of the privateers. The fiscal crisis of the state was driven by sell-offs and so further sell-offs would only make things worse.

    Also, following on from Attila, there was a strong environmental argument. If coal-fired power generation needs to be phased out, the state can more easily make that decisions than private owners who have a vested interest in keeping it going.

    Finally, as SMH economics editor Ross Gittins was candid enough to admit, privatisation was really about breaking the ability of some key public sector unions to prevent downward pressure on wages and conditions (see: ). This is tied up with Iemma’s wider battle against the unions, which was part of continuing the breaking of ties between organised workers and the party that (allegedly) represents their interests.

    I find your argument about leaders needing to be able to lead misplaced here. This was leadership in the interests of private capital and directed against the interests of working people. In the end Iemma’s destruction was caused by the fact that the ALP remains the party of the trade union bureaucracy, and in the absence of an alternative for them to support, they would rather destroy their party’s electoral chances than lose all control. This has happened before, and marks out one way that the ALP remains different (and preferable) to openly capitalist parties like the Liberals, despite increasing policy convergence.

    Virtually all NSW journalists and commentators (Benson among them) supported the sell-off as a marker of Labor’s commitment to the state’s capitalist class. We on the Left should be celebrating the effective collapse of the privatisation push. It has fed into increased confidence by other unions (e.g the prison officers) to hold the line against sell-offs. Of course the victory was sidelined into internal ALP politicking, but that shouldn’t undermine its importance.

    The strength of the movement against Iemma has also tied Barry O’Farrell’s hands — he has had to pose as a moderate, and even to the Left of Labor on some issues. No matter how bad the electoral rort of the ALP, it will not be easy for the Liberals to claim a mandate to “lurch to the Right” after the 2011 election.

  3. Thanks for your replies and contribution to the discussion of the issues raised in Betrayed. Certainly Benson is very sympathetic to Iemma and the privitisation issue was presented as a fait accompli, as you pointed out Atilla. I certainly don’t belive in privitisation, I think if you need to have a state then it should own, at least, the essential services. As I said in my review, Benson made it sound like there was no other option although he really didn’t canvass other options and thanks Dr Tad for your insights on the matter. Living in Darwin, I am somewhat removed from the intracies of the debate so your input is much appreciated. I guess Benson wasn’t so concerned with examing other options as it wasn’t really what the book was about. As for the need to phase out coal driven power stations, yeah they need to go but I’m unsure that the ALP would be any more likely to phase them out than private companies-certainly the ALP has proven itself to be beholden to power companies in NSW so can’t see them running off to close them down any time soon and the Liberals obviously won’t. As for leaders needing to lead, well i think in some respect if you’re going to support the notion of leaders in this so called parliamentary democracy then by virtue of your belief in that system then they should be given the right to lead. It is after all a form of social contract and by investing in a ‘leader’ to speak on your behalf or represent you then the assumption is that you have enough of a belief in them, their ethics and politics to say and do what is right. In that sense Gough should have been allowed to see out his full term and so should have Rudd. I concede that Iemma was doing something contentious and went against the grain of the ALP, so there was some justification in him being called to account as it was seen as being a betrayel of ALP policy, which is laughable of course because they started the whole privitisation debacle anyway. Still I think the whole thing was more about faction power plays than anything else. Anyway I think using the line leadership and interests of working people to be an oxymororon, the minute you have leadership then the interests of working people become secondary to the desire to maintain and expand the leaders powerbase. Trades Hall and the union heirarchy have fucked working people over enough times to prove that.

    There is a lot more to be said about Betrayed and no doubt a better analysis to be written and everyone one takes what they want from a book. For me it was the insight into the modern ALP and the way it has become a tragic joke. I grew up in a SL ALP household, regular dinner guests were members, some infamous, from the hard left. I grew up with a particular understanding of the ALP and what it stood for. The reality of what the ALP now stands for is nothing like what it once did and maybe the fact that the party would rather destroy its electoral chances that cede control may distinguish it from the Liberal Party, as you said Dr Tad but I don’t think it makes them preferable to the Liberal Party, or much different. That’s a theoeritical difference and doesn’t in anyway excuse their policy convergence, which I think is a polite phrase considering they’ve blended into the Liberal party in most respects. I’d rather vote informal, and have done when there’s been no other alternative, that endorse any of their vile policies. So for me Betrayed was an insight into the ALP, and the farce it has become and you’re right Atilla the book would have been better if it was written with more farce and less tragedy. My only hope is that with the current power play and the asendency of The Greens that the ALP starts to court compassion again but I’m not holding my breath as representive democracy, especially in a capitalist society is doomed to failure.

    Thanks again for your input, insights and offerings.


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