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Right-Wing Social Democrats for Coal

The Australian Labor Party’s right wing has a new faction, the “Otis Group,” that uses the language of jobs and economic prosperity to pit working-class interests against the fight to stop global warming. It’s a cynical strategy that won’t pay off — and will continue cooking the planet in the meantime.

Opposition leader Anthony Albanese (L) and shadow minister for sport Don Farrell arrive for a news conference at Parliament House on February 05, 2020 in Canberra, Australia. Tracey Nearmy / Getty

On February 12, a story broke about a group of Australian Labor Party (ALP) parliamentarians who have been dining regularly on the sly in a swanky Canberra restaurant, OTIS. Dubbed the “Otis Group,” they are a cabal of right-wing Labor MPs who want to push the party in a more coal-friendly direction. According to right-faction power broker and member Don Farrell, the group’s purpose is “supporting coal workers.”

The membership list of the Otis dining club is a who’s who of Labor’s hard right. Farrell comes from the Shop, Distributive and Allied Employees Association (SDA), a union known for its yearslong opposition to same-sex marriage, abandoned only after the reform was won. The SDA is also possibly the only union in the country to have won worse conditions and rates for its members, in enterprise bargaining agreements (EBAs) applauded by the industry group and conservative MPs.

Other members of the group include Kimberley Kitching, whose cheerleaders in the right-wing Murdoch press have in the past congratulated her for making reactionary appeals to “Judeo-Christian” and “Western” values.

Then there’s Joel Fitzgibbon, the group’s most outspoken member. In the 2019 federal election, Fitzgibbon’s safe ALP seat of Hunter, to the north of Sydney, swung heavily toward the fringe nationalist party, One Nation, which ran a coal worker as a candidate. Though Fitzgibbon kept his seat, the swing in Hunter, along with broad swings against Labor in Queensland, has spurred fears that the ALP is losing its once-reliable blue-collar base.

Class Collaboration

The Otis Group purports to stand for labor interests. They claim to represent salt-of-the-earth blue-collar workers, exemplified by miners, power plant operators, and others employed by the coal industry. Their quasi-populist rhetoric assumes that the fates of workers and industry are identical. They would have you believe that coal workers and coal bosses must stand united in the good fight against the post-materialist, inner-city green left.

But you couldn’t imagine two Labor MPs further from the working class than Don Farrell and Kimberley Kitching. The former has his own Clare Valley wine label, while the latter is famous for hosting Great Gatsby–esque parties in her heritage-listed mansion. As tribunes of the working class battling the detached elites of Big Green, they leave something to be desired.

While coal workers earn over 50 percent more than the average Australian wage, coal bosses take home millions of dollars in profit every year. Hancock Prospecting (76 percent of which is owned by Gina Rinehart, the richest woman in the world in 2012) made AU$2.6 billion in profit last financial year.

That figure is just a fraction of the combined AU$68 billion worth of thermal and metallurgical coal exported in 2018–19. As if this weren’t enough, the thermal coal industry rakes in more than a billion dollars in subsidies every year while wages have stagnated for decades. To put it simply, coal miners and power-plant workers have labored to produce a vast fortune for ultra-wealthy mining magnates.

These magnates have also pushed to lower labor costs by automating as much as they can — a major factor in the 30 percent decline in employment in Western Australia between 2013 and 2016.

In the case of the proposed Adani mine, its corporate backers (in and out of the ALP) argue it will create jobs. At most, however, the mine will produce 1,500 ongoing jobs, largely in IT. Some estimates suggest the real figure is as low as one hundred jobs.

With regard to jobs, the situation is worse still. Only 0.15 percent of the Australian population (around 38,100 people) work in coal mining. The bushfires over the summer — irrefutably linked to climate change — are estimated to cost over AU$2 billion, with many thousands of jobs to be lost in tourism, agriculture, and other rural industries — some burned away and others priced out by skyrocketing insurance premiums.

Already, the job market has slumped to its lowest level in four years. Meanwhile, Australians employed in every industry and walk of life have suffered this summer, breathing in dangerously heavy smoke in major cities due to unprecedented climate change–fueled bushfires across the country.

Coal Will Die — But on Whose Terms?

Global coal prices are dropping as the world slowly transitions to renewables. The third largest exporter of fossil fuels worldwide, Australia, too, will have to transition. This will mean the end of coal jobs. The Otis Group are only pushing to delay the inevitable, and at the detriment of the very workers they claim to represent. Without a plan for transition, the fates of coal workers will be left for the market to decide.

We already know what this will look like. In the 1990s, Liberal premier Jeff Kennett privatized Victoria’s electricity supply, concentrated in the coal-rich Latrobe Valley. By 2017, Hazelwood Power Station, one of the most polluting in the country, was finally shut down, and the other stations that still operate are already old and are due to be decommissioned in the next two decades.

Today, very few people dispute the necessary closure of Hazelwood. Yet the fact that it was privately owned meant that the consequences have been catastrophic. A corporation, after all, has no interest in supporting workers or their communities if they can’t make money doing so. And rising unemployment in the Latrobe Valley has led to business closures, falling house prices (making it harder for working-class residents to move), and a declining population. Only last year, the Hazelwood Power Corporation was found guilty of putting staff and the public at risk over an out-of-control mine fire that burned for forty-five days, blanketing the region in a dense layer of smoke and coal dust.

Solidarity vs. Business Unionism

For socialists in the ALP, the battle against the Otis Group will be an uphill one. They represent an old anti-leftist tradition in the labor movement that goes back to the days after World War II. The Industrial Groups (“the Groupers”) organized Catholic Cold Warriors to fight against communist control of the unions, and they won the support of the SDA. A right-wing union with a cozy relationship with retail giants Coles and Woolworths, the SDA has at times struck deals so bad that, in 2016, the national industrial court found that workers were worse off under the union agreement than under no agreement at all.

As a reward for class collaboration, Coles and Woolworths often recruit new workers to the SDA as part of induction, vastly inflating its membership and dues pool. This means a greater share of conference floor within the Labor Party, and thus control over party policy and, in many states, over preselection contests. Business unionism is how many hard-right MPs and union bureaucrats maintain their status as a labor aristocracy inside and outside the party. The emergence of the pro-coal Otis Group is a new development in this very old pattern.

Worst of all, the Otis Group has already secured a key victory: ALP leader Anthony Albanese has finally thrown his support behind the Adani mine, saying, “One of the things we have to do is show that we respect workers.” Far from respect, Albo’s capitulation to the coal bosses and their ALP allies is a slap in the face. Only a socialist Just Transition will give coal workers the respect they deserve for the years of work they’ve given to an industry that is in its final years.