{"id":1804,"date":"2025-05-07T11:15:41","date_gmt":"2025-05-07T10:15:41","guid":{"rendered":"https:\/\/blogs.sussex.ac.uk\/centre-for-the-study-of-corruption\/?p=1804"},"modified":"2025-05-19T14:48:26","modified_gmt":"2025-05-19T13:48:26","slug":"elite-cartel-corruption-in-tasmania-the-nature-of-the-game","status":"publish","type":"post","link":"https:\/\/blogs.sussex.ac.uk\/centre-for-the-study-of-corruption\/2025\/05\/07\/elite-cartel-corruption-in-tasmania-the-nature-of-the-game\/","title":{"rendered":"Elite Cartel corruption in Tasmania \u2013 the nature of the game"},"content":{"rendered":"\n
\"\"
Lake Pedder, South West Tasmania, \u00a0prior to its flooding in 1972. The area was later declared a World Heritage Site, and the flooding led to the formation of the first Greens party in the world to contest an election. Image \u00a9\u00a0David Neilson<\/a><\/figcaption><\/figure>\n\n\n\n

In this second post on Tasmania, Robyn A. Lewis[1]<\/a> and Professor Michael Johnston[2]<\/a> examine corruption in Australia\u2019s smallest state through the lens of the Elite Cartel syndrome, highlighting its sources and continued dominance.<\/p>\n\n\n\n

Our previous post<\/a> illustrates how Tasmania exemplifies the Elite Cartels (ECs) syndrome (Johnston, 2014)[3]<\/a>: close-knit, collusive elite networks that perpetuate a distribution of public power and resources skewed in their favour. ECs provide an environment in which corruption can thrive and are an intrinsically corrupt way of organising a political economy.<\/p>\n\n\n\n

EC dominance has a long history in Tasmania<\/a>. The \u201cApple Isle\u201d is small and somewhat insular and parochial. While universal adult suffrage began in 1903<\/a>, today\u2019s ECs’ predecessors evolved in the 1850s (Perry, 2001). Networking elites in business, government and the economy may not have set out to create corrupt schemes, but over time their convenient, self-serving alliances led to distinctive forms of corruption \u2013 an Elite Cartel syndrome, similar to Lessig\u2019s Institutional Corruption (2013)[4]<\/sup><\/a> featuring actions and inactions serving dominant interests, yet rarely breaking laws[5]<\/sup><\/a>.<\/p>\n\n\n\n

EC influence raises a larger question: Australia is a prosperous modern democracy with relatively competitive parties and free, fair Federal and State elections. How do ECs remain entrenched without public outcry or ballot-box rejection? Part of Tasmania\u2019s answer is that ECs \u2013 historically, \u2018the way things work\u2019 \u2013 continue to benefit political and business elites in very profitable<\/a> ways, while those less well-connected miss out (Johnston, 2005). Other reasons are limited alternatives, and a self-perpetuating lack of transparency and accountability<\/a> between elections.<\/p>\n\n\n\n

Beyond bribery<\/strong><\/p>\n\n\n\n

Corruption[6]<\/a> is still often equated with bribery, so when bribery is not news, and other forms of corruption poorly understood, for many there is little cause for concern, particularly when perception scores are good<\/a>. Bribery largely dominated Hay\u2019s (1973) analysis of Tasmanian corruption, including alleged bribery of Forestry Commission officials and the Forestry Minister by sawmillers in 1945<\/a>; of the Premier, by road transport officials in 1947<\/a>; the Treasurer in 1958<\/a>; the Deputy Premier\/Attorney General by bookmakers in 1972<\/a>; and a state MP holding the balance of power, by  Federal Hotels<\/a> and British Tobacco in 1973<\/a>.

However, applying the lens of EC corruption highlights today\u2019s less blatant forms of corruption which sustain informal but influential elite coalitions in business, government and others seeking to maintain the benefits of the status quo<\/em>. Although often legal, largely due to lags<\/a> in introducing new or updating existing legislation[7]<\/a>, Tasmania\u2019s EC corruption remains socially demoralising<\/a> and costly.<\/p>\n\n\n\n

ECs operate, not primarily through bribery, but via<\/em> collusion, obfuscation, bullying<\/a> and secret deal-making<\/a>, sidelining competitors<\/a> and critics<\/a> (Johnston, 2014; linked examples are Tasmanian[8]<\/a>). Many EC activities are insidious, taking place out of public view; major scandals are minimised and bribery is generally unnecessary, for EC networks offer cheaper, more discreet and effective, and less risky ways to achieve desired outcomes. Often, EC influence works by inaction \u2013 by neglect or design \u2013 because policy changes or extensive public consultation can introduce delays and expenses<\/a>, and disrupt an elite-friendly status quo.<\/em>

Tasmanian state guidelines<\/a> require community engagement in decision making[9]<\/a>, but terms of reference can be restricted<\/a>, consultations may be inadequate, potentially misleading<\/a>, or never occur. Consultation findings[10]<\/a> may be preempted<\/a>, published belatedly<\/a>, concealed<\/a> or ignored<\/a>. Philp (2017) differentiated incompetence as another form of political failure, but incompetence can only explain so much. It also provides a fertile field for corrupt actors to exploit under inadequate scrutiny (Bozeman and Jung, 2022).

Adverse outcomes include restricted competition<\/a>, valid public concerns omitted from planning<\/a> and legislation<\/a>, and pushing through ill-founded government decisions without social licence<\/a>. Reduced accountability<\/a> and transparency<\/a>, regulatory failure and loss of trust (Cullen-Cox et.al., 2021), and further risks of corruption and reduced governance capacity may result (Graycar and Villa, 2011).<\/p>\n\n\n\n

Much of what ECs do looks like \u2018business as usual\u2019 and is difficult to trace[11]<\/a>. ECs<\/a> seldom bring down whole regimes because often they are <\/em>the regime. Particularly in smaller jurisdictions<\/a> where elite networks can be tight (Veenendaal, 2019), EC collusion can keep controversy \u2013 and accountability \u2013<\/em> within \u2018manageable\u2019 bounds. ECs are tenacious in protecting the status quo<\/em>, and in Tasmania it suits them to have governance systems lagging the rest of Australia[12]<\/a>.Ironically however, EC states can be vulnerable to influence from external actors[13]<\/a> seeking to exploit economic opportunities and weak accountability, an added risk especially for Tasmania\u2019s indebted economy<\/a>.<\/p>\n\n\n\n

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Image Credit: Google Earth image of the site of the former Gunns Pulpmill, Tamar Valley, northern Tasmania<\/figcaption><\/figure>\n\n\n\n

Gunns Pulpmill \u2013 an ongoing legacy

<\/strong>A notorious case encapsulating EC influence is Gunns Limited, a timber-processing concern which in 2003 decided to construct a pulp mill<\/a> in a northern Tasmanian nature conservation area. Designed to convert local timber[14]<\/a> into over a million tons of export woodpulp annually, it would consume seventy million litres of water daily, and release effluent containing dioxins into Bass Strait and airborne emissions into a temperature inversion layer. Yet the State saw all industrialisation as beneficial, regardless of social or environmental cost (Beresford, 2015), alternative visions<\/a> or competing objectives[15]<\/a>.

One might expect such a major project to require extensive, meaningful public consultation, but in 2004 the site\u2019s conservation status was lifted and the project proceeded without social licence. In 2007 further approvals drew criticism from Tasmania\u2019s Resource Planning and Development Commission. Gunns simply withdrew from their assessment processes, resulting in one possible outcome<\/a>: the Commission was disbanded. Federal approval followed. 

The project was eventually scuttled, not by public interest considerations but by declining pulp and timber markets (Wells, 2010); in 2011 Gunns entered voluntary administration. There was an unsuccessful $100,000 bribery attempt<\/a> by Gunns\u2019 Chairman to a Labor MP to cross the floor and prevent formation of a Greens coalition. In 2013 Gunns\u2019 Managing Director was convicted of insider trading<\/a>. Such conventional corruption gained most public and media attention, but Gunns\u2019 EC tactics  \u2013  secret initial negotiations<\/a>, favouritism, collusion, mutual back-scratching, and the lack of transparency, consultation or public approval \u2013 received much less, helping keep the proposal alive for seven years and forming a template that persists today.<\/p>\n\n\n\n

Similar tactics have since been observed in other controversies at both state<\/a> and local council levels<\/a>. Disregard of public interest is a running theme in Tasmania\u2019s governance, accelerating in the 1970s when public concern mounted over the environmental impacts of exploiting Tasmania\u2019s natural resources including timber<\/a> and hydro-electricity<\/a> (including Lake Pedder<\/a>[16]<\/a>), and extending since to mining<\/a>, windfarms<\/a>, waterways\/oceans<\/a>, parklands<\/a>, eco-tourism<\/a>, property developments<\/a> and more [17]<\/a>.

Wherever there is a \u2018free\u2019, inadequately-controlled<\/a> public resource from which to profit, especially where governance requires reform<\/a>, corruption can occur.
<\/p>\n\n\n\n

EC corruption is harmful<\/strong>

Every community has elites, often prominent in public service. But when networks become entrenched,  concealing key decision processes, stifling debate and driving threatening issues underground<\/a>, democratic inclusion is lost (Warren, 2004) and inequality is worsened<\/a>. Other tactics \u2013  e.g<\/em>. delay<\/a>, restricting competitors<\/a>, segmenting tenders below accountability thresholds, bypassing planning regulations \u2013 potentially benefit cronies.

Critics are marginalised<\/a> or denigrated as \u201cblockers<\/a>\u201d: challenging the consensus, and making valid complaints e.g.<\/em> about poor planning, lack of vision, financial impacts<\/a> or regulatory failure<\/a> can result in bullying, exclusion<\/a> and even violent disputes<\/a>[18]<\/a>. Legislation[19]<\/a> can be delegated to individuals or NGOs to attempt to uphold. Meanwhile, directorships can be reserved for \u2018captain\u2019s picks\u2019, and \u2018revolving doors\u2019 enable EC insiders to pursue cushy private employment or consultancies. Social division<\/a> is reinforced.<\/p>\n\n\n\n

EC corruption mostly benefits the well-connected[20]<\/a>; for others it causes real harm to families, communities, and citizens\u2019 right to be informed<\/a>. Our third installment examines these costs, including a case that nearly derailed MONA, one of Tasmania\u2019s most valuable cultural and economic assets<\/a>. A fourth and concluding posting, on reforms, will follow.  <\/p>\n\n\n\n

Bibliography<\/strong><\/p>\n\n\n\n

Bachrach, P. and Baratz, M.S. (1975) \u2018Power and Its Two Faces Revisited: A Reply to Geoffrey Debnam\u2019, The American Political Science Review<\/em>, 69(3), pp. 900\u2013904. Available at: https:\/\/doi.org\/10.2307\/1958398<\/a><\/p>\n\n\n\n

Beresford, Q. (2015) The Rise and Fall of Gunns Ltd<\/em>. New South Publishing. Available at: https:\/\/unsw.press\/books\/the-rise-and-fall-of-gunns-ltd\/<\/a> (Accessed: 7 February 2025).<\/p>\n\n\n\n

Bozeman, B. and Jung, J. (2022) \u2018The Corruption-Incompetence Nexus: Analysis of Corrupt US Mayors\u2019, Journal of Policy Studies<\/em>, 37(2), pp. 1\u201312. Available at: https:\/\/doi.org\/10.52372\/jps37201<\/a>.<\/p>\n\n\n\n

Cullen-Knox, C. et al.<\/em> (2021) \u2018Perceiving Environmental Science, Risk and Industry Regulation in the Mediatised Vicious Cycles of the Tasmanian Salmon Aquaculture Industry\u2019, Social Epistemology<\/em>, 35(5), pp. 441\u2013460. Available at: https:\/\/doi.org\/10.1080\/02691728.2021.1913661<\/a>.<\/p>\n\n\n\n

Flanagan, R. (2021) Toxic – The Rotting Underbelly of the Tasmanian Salmon Industry<\/em>. 1st edn. Australia: Random House. Available at: https:\/\/jameshwhitmorereviews.com\/2021\/05\/17\/review-toxic-by-richard-flanagan\/<\/a> (Accessed: 10 February 2025).<\/p>\n\n\n\n

Graycar, A. and Villa, D. (2011) \u2018The Loss of Governance Capacity through Corruption\u2019, Governance<\/em>, 24(3), pp. 419\u2013438. Available at: https:\/\/doi.org\/10.1111\/j.1468-0491.2011.01535.x<\/a>.<\/p>\n\n\n\n

Hay, P.J. (1973) \u2018Factors Conducive to Political Corruption: The Tasmanian Experience\u2019, Political Science<\/em>, 29(2), pp. 115\u2013130.<\/p>\n\n\n\n

Johnston, M. (2005) \u2018Elite Cartels: how to buy friends and govern people\u2019, in Syndromes of Corruption: Wealth, Power, and Democracy<\/em>. Cambridge: Cambridge University Press, pp. 89\u2013119. Available at: https:\/\/doi.org\/10.1017\/CBO9780511490965.006<\/a>.<\/p>\n\n\n\n

Johnston, M. (2014) Corruption, Contention, and Reform: The Power of Deep Democratization<\/em>. Cambridge: Cambridge University Press. Available at: https:\/\/doi.org\/10.1017\/CBO9781139540957<\/a>.<\/p>\n\n\n\n

Lessig, L. (2013) \u2018\u201cInstitutional Corruption\u201d Defined\u2019, Journal of Law, Medicine & Ethics<\/em>, 41(3), pp. 553\u2013555. Available at: https:\/\/doi.org\/10.1111\/jlme.12063<\/a>.<\/p>\n\n\n\n

Lindenmayer, D. (2024) The Forest Wars<\/em>. 1st edn. NSW: Allen & Unwin. Available at: https:\/\/wildislandtas.com.au\/products\/the-forest-wars<\/a> (Accessed: 15 February 2025).<\/p>\n\n\n\n

Paar-Jakli, G. and Molina, A.D. (2024) \u2018Democracy, Authoritarianism, and Political Corruption: Elite Cartel Corruption in Hungary and Italy\u2019, Public Integrity<\/em>, 26(5), pp. 520\u2013538. Available at: https:\/\/doi.org\/10.1080\/10999922.2023.2256091<\/a>.<\/p>\n\n\n\n

Perry, P.J. (2001) Political Corruption in Australia \u2013 a Very Wicked Place?<\/em> 1st edn. London, UK.: Routledge Revivals, Taylor & Francis.<\/p>\n\n\n\n

Philp, M. (2017). Conceptualizing political corruption. In A. I. Heidenheimer & M. Johnston (Eds.), Political Corruption<\/em>: Concepts and Contexts. 3 ed. Ch. 3 (pp. 61-75). Taylor and Francis. https:\/\/doi.org\/1 0.4324\/9781315126647-4<\/a><\/p>\n\n\n\n

Veenendaal, W. (2019) \u2018How Smallness Fosters Clientelism: A Case Study of Malta\u2019, Political Studies<\/em>, 67(4), pp. 1034\u20131052. Available at: https:\/\/doi.org\/10.1177\/0032321719828275<\/a>.<\/p>\n\n\n\n

Warren, M.E. (2004) \u2018What Does Corruption Mean in a Democracy?\u2019, American Journal of Political Science<\/em>, 48(2), pp. 328\u2013343. Available at: https:\/\/doi.org\/10.1111\/j.0092-5853.2004.00073.x<\/a>.<\/p>\n\n\n\n

Wells, G. (2010) \u2018Economic Assessment of the Gunns Pulp Mill 2004 – 2008\u2019, Working Papers<\/em> [Preprint]. Available at: https:\/\/ideas.repec.org\/\/p\/tas\/wpaper\/10445.html<\/a> (Accessed: 26 January 2025).<\/p>\n\n\n\n

\n\n\n\n

[1]<\/a> Robyn Lewis is an MA student in Corruption and Governance, Centre for the Study of Corruption, University of Sussex, UK.<\/p>\n\n\n\n

[2]<\/a> Michael Johnston<\/a> is the Charles A. Dana Professor of Political Science Emeritus at Colgate University, in Hamilton, New York, USA.<\/p>\n\n\n\n

[3]<\/a> Also diagnosed in e.g. <\/em>South Korea<\/a>, Italy and Hungary (Paar-Jakli and Molina, 2024; Johnston, 2014)<\/p>\n\n\n\n

[4]<\/a> Also common but often overlooked in mature liberal democracies. See Thompson, D.F. (2018) Theories of institutional corruption. Annual Review of Political Science<\/em>, 21<\/em>(1), pp.495-513.<\/p>\n\n\n\n

[5]<\/a> Or if they do in Tasmania, they are not investigated nor prosecuted. See Flanagan R. (2021)<\/p>\n\n\n\n

[6]<\/a> The abuse of entrusted power for private gain which harms the public interest, typically breaching laws, regulations, and\/or integrity standards. (Dobson-Phillips et.al., 2023)<\/p>\n\n\n\n

[7]<\/a> Including Tasmania\u2019s Criminal Code Act (1924)<\/p>\n\n\n\n

[8]<\/a> Note: not all these examples may involve corruption but are potential examples of the types of behaviours described<\/p>\n\n\n\n

[9]<\/a> Although this is currently under threat at the local government level<\/a><\/p>\n\n\n\n

[10]<\/a> Also those of government inquiries etc<\/em><\/p>\n\n\n\n

[11]<\/a> Tasmania has a Right to Information process<\/a>, but RTIs only cover written communications or those officially recorded. Results are often delayed and significantly redacted. The RTI process is currently under review.<\/p>\n\n\n\n

[12]<\/a> E.g<\/em>. Tasmania is the only state\/major territory with no ICAC.<\/p>\n\n\n\n

[13]<\/a> Interstate and international<\/p>\n\n\n\n

[14]<\/a> Both plantation timber, and controversially, native forests including old-growth trees (i.e.<\/em> hundreds of years old)<\/p>\n\n\n\n

[15]<\/a> Such as the economically-important tourism industry<\/a>, or Brand Tasmania<\/a>, founded on a \u2018clean, green\u2019 image.<\/p>\n\n\n\n

[16]<\/a> Which saw the birth of the first Greens party in the world to contest an election<\/a>, the UTG (United Tasmania Group)<\/p>\n\n\n\n

[17]<\/a> There remain exceptions, including a 1989 allegation against the Head of the Premier\u2019s Department regarding the appointment of a controversial Ombudsman (Johnston v Alan Hanson Evans, 1992). However today\u2019s influence is largely acquired in indirect, EC ways, aided by growing media monopoly<\/a><\/p>\n\n\n\n

[18]<\/a> A failure in implementation of local government regulatory processes allegedly contributed (State of Tasmania v Kerry Alexander Bilston, May 2018)<\/p>\n\n\n\n

[19]<\/a> Including the Federal Environmental Protection and Biodiversity Conservation Act (1999)<\/p>\n\n\n\n

[20]<\/a> And their employees and contractors, an often-overlooked factor<\/p>\n","protected":false},"excerpt":{"rendered":"

In this second post on Tasmania, Robyn A. Lewis[1] and Professor Michael Johnston[2] examine corruption in Australia\u2019s smallest state through the lens of the Elite Cartel syndrome, highlighting its sources and continued dominance. Our previous post illustrates how Tasmania exemplifies…<\/span><\/p>\n

Read more ›<\/a><\/div>\n

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