What a lily-white lot we are

(First published in the Nelson Mail and Manawatu Standard, August 28.)

It received very little coverage in the New Zealand media, but for six months this year the New South Wales Independent Commission Against Corruption conducted an inquiry into extremely dodgy dealings involving former ministers in the NSW state government.

The commission presented its findings to the New South Wales Parliament several weeks ago. It found that two former Labor Party ministers, Eddie Obeid and Ian Macdonald, had engaged in corrupt conduct involving the issue of lucrative coal mining licences.

In a nutshell, the commission alleges that Obeid – a former powerbroker in the right wing of the faction-ridden NSW Labor Party – acquired several rural properties over which the state government subsequently issued a coal exploration lease. Macdonald was the Minister of Mining at the time.

Obeid’s family and friends were in on the deal too. They made an estimated $30 million not only from selling the land, but also by investing in the company that eventually won the mining exploration licence over the area – a very tidy little arrangement.

The commission heard that Lebanese-born Obeid, whose political career was repeatedly dogged by allegations of sleaze in one form or another, had advance knowledge of the exploration lease and influenced the mining licence process.

There was an enormous amount of colourful background detail which I won’t go into here, other than to mention that the commission also heard that former champion boxer Lucky Gattellari and a wealthy property developer named Ron Medich provided Macdonald with a prostitute named Tiffanie (he was given a choice of four) in an attempt to secure favours from the government.

In an unrelated action, Gattellari is the key witness in a court case in which police allege Medich ordered the 2009 murder of a former business associate.

Meanwhile the commission is concluding a separate inquiry into claims relating to another mining licence granted by Macdonald to a company chaired by a mate who was a former trade union boss.

Google some of the names involved in this saga and you are led into a labyrinthine network of connections between politics and crime. In Australia, and especially in Sydney, the boundaries between the two worlds are often blurred.

When we hear of corruption we tend to think of Chicago and New York, but there’s very little the Americans could teach our trans-Tasman neighbours about graft and political fixing (or police corruption, come to that). The mere fact that NSW has had a permanent commission investigating claims of corruption since 1988 speaks volumes.

From a New Zealand perspective, all this seems extraordinary. We're a lily-white lot by comparison. The only New Zealand politician to be convicted of corruption is former Labour Party minister Taito Phillip Field, whose offence – getting a tiler from Thailand to work for him on the cheap in return for help with a work permit – wouldn’t cause so much as a raised eyebrow across the Ditch.

A scandal on the scale of the Obeid affair is unheard of here and would cause a sensation. But Sydneysiders are so inured to allegations of corruption that they take it in their stride.

All of which raises an intriguing question. Why, when Australia and New Zealand have so much in common, are they so different from one another in this respect?

Criminality is deeply embedded in Australian culture. It not only intrudes into politics but crosses over into trade union affairs too.

I once interviewed Norm Gallagher, head of the militant Builders Labourers Union in Melbourne. There was intense rivalry between the Victorian and NSW branches of the union at the time, and while I was with Gallagher he took a phone call supposedly warning him that a contract had been taken out on his life and a hit man was on his way from Sydney. Gallagher, who seemed unfazed, showed me a loaded shotgun that he kept behind his office door for such contingencies.

The Melbourne office of the Sydney newspaper I worked for at the time was in the same street as the docklands headquarters of the notorious Federated Ship Painters and Dockers Union, which was essentially a front organisation for criminals. I recall driving past on the day of the union elections and seeing men openly packing shotguns.

Not long after that, Pat Shannon, the union secretary, was shot dead in a South Melbourne pub. It was a professional hit – a relatively common event in Melbourne then. Melbourne was a very violent city, as it has been again in recent years, and many of the gangland feuds could be traced to members of the Painters and Dockers Union.

Here’s another intriguing thing about Australian crime: the people in the thick of it are often migrants, or the children of migrants.

In the 1960s one of the kingpins of the Sydney underworld was Malta-born Perce Galea, a devout Catholic whose power was based on gambling rackets. Another Maltese criminal, Joe Borg, owner of a string of brothels, was killed in 1968 by a car bomb, detonated when he turned on the ignition of his Holden ute in Bondi. 

These days the bad guys are more likely to be Lebanese, Italian, Serbian, Albanian or Asian (although we shouldn’t forget that when the Mr Asia drug syndicate was at its most active in the 1970s, the most violent criminals in Australia were New Zealanders).

New Zealand has immigrant communities too. Nelson and Wellington, for example, have substantial populations of Italian descent, but they are untainted by criminal associations. On the contrary, they are respected as honest, hard-working and community-minded.

Contrast that with Robert Trimbole’s murderous Mafia drug ring in the marijuana-growing New South Wales town of Griffith, or the Italian-dominated Carlton Crew gang formed by Alphonse Gangitano in Melbourne.

To explain the difference, we may have to look to history. We make jokes about Australians having convict ancestry, but there may well be something in their collective heritage that makes them more tolerant of crime and corruption.

Australia’s very first settlers, after all, were taken there as punishment, against their will. New Zealand, on the other hand, was colonised by people who came of their own volition and were motivated by a powerful desire to create a better society than the one they had left behind.

You have to wonder whether those contrasting origins have left permanent imprints on the two countries.