How memes show us the future of news.

News stories were once true and substantive.* Now they often aren’t.**

Who chose this? Why has it happened? Who can we blame?

To begin the answer, let us take a quick detour into the world of memes. For a meme to spread, what matters is its shareability. Whether a chain letter or a Facebook video about sloths, certain characteristics of memes make them highly shareable. They go viral. They splinter and are adapted. The most memetically fit versions perpetuate and grow stronger.

In memes we can see very easily that shareability need have little to do with truth, little to do with substantiveness.

Our collective future is being crushed in the shrinking blue ellipse like rebels in a trash compactor
Our collective future is being crushed in the shrinking blue ellipse like rebels in a trash compactor.

News is just the sharing of information. So why would we expect truth and substantiveness to be important in News?

Well (you may say) the history of the 20th Century! In that period, news sources that thrived – one could mention the New York Times here – were ones that invested in reputations for truth and substantiveness. There is precedent.

And, obviously, the human brain is adapted to crave true things. Mostly. This is evolutionarily adaptive on the whole. (It is worth pointing out that memetic fitness is not about the memes in isolation. The environment in which the memes live and die – the human brain and surrounding culture – is vitally important. )

So there is good reason to think truth, substantiveness and news can go hand in hand in hand. But they needn’t, if other incentives in consumption or production are more important.

For example More copies of Soviet newspaper Pravda were printed than the New York Times during the 1970s. (It may have been substantive but it was not always true.) And of course there have always been gossip magazines – which sold more copies than the Times, Washington Post, and Wall Street Journal put together.

The truth and substantiveness of those key western news sources in the 20th century seemed so crucial they would stay like that forever. But those features were actually always fragile, never universal, and only ever contingent on a happenstance combination of incentives.

What were those incentives coerced major news sources to be true and substantive? I don’t purport to know for sure, but I can think of several plausible candidates.

On the production side:

  • Time. Newspapers came out generally only once a day, or perhaps once a week. Facts could be checked. Re-using other outlets stories was simply a way to be a day late.
  • Money. There was no other good way to get people ads.
  • Advertiser influence: They wanted a credible environment to carry their spruiking.
  • Access. Politicians would not talk to newspapers that were non-credible.
  • Niches. A large profitable market meant gossip and political journalism were not all bundled in together under one masthead. Brands were clear.

On the consumption side:

  • A select readership. Over the 20th century, literacy skyrocketed. But reading the ‘important’ newspapers was still the preserve of the educated (and those who could afford them) for decades.
  • Your paper of choice was public knowledge. It lay on your front lawn each morning and on the train anybody could see what you were reading. The stories you knew about also depended on what paper you read. Reading a ‘serious’ paper was a status symbol.

Some readers may look at this list of little reasons and deem them beside the point – yes, yes but the fourth estate has a vital role in holding the mighty to account!

But the lesson of memes is we don’t get what is vital – we get what incentives allow.

“Any human with above room temperature IQ can design a utopia. The reason our current system isn’t a utopia is that it wasn’t designed by humans. Just as you can look at an arid terrain and determine what shape a river will one day take by assuming water will obey gravity, so you can look at a civilization and determine what shape its institutions will one day take by assuming people will obey incentives.”

-Slate Star Codex

We can fund the Press Council, lionise the ABC’s Media Watch program, read the remaining journalists we think are credible, cry at the Walkley awards, rant about clickbait in the comments and so on. But that won’t be more than a sandcastle against the tide. If we want to bring back large volumes of very good journalism we need to change incentive structures.

All this is why I try to avoid bashing individual journalists for the fate of the media. Some people – with the finest of intentions – try single-handedly to reshape the incentive structure of the entire industry. They use the internet to shame and berate journalists and outlets for producing what they perceive as low-quality content.

It’s a valiant attempt. In some ways these people are heroes. They are making themselves very angry and quite unpopular in an attempt to uphold the common good. I thank them. But they cannot do it alone.

The incentives are what matter. The question is whether the incentive change that came with the rise of the internet is permanent. I am hopeful that the recent dislocation is fleeting. Technology is not done changing.


A revival of news may even be inevitable. We may see experimentation in news production, distribution and consumption of news until someone hits on a model that pays for itself. This is why we have capitalism – if a product exists that people want, the market will reward handsomely anyone that can find a way to package and deliver it.

One possible form news could take is the trade press – boutique outlets for paying clients who absolutely want only the facts.  Alternatively, perhaps Facebook will fund reporting and investigations. Or online classifieds will add content to bring in more eyeballs and thereby accidentally reinvent the newspaper from the other side. (Or a combination of this second two – online selling groups on Facebook are seemingly huge now.)

More likely it will be something else entirely that brings back serious news. On the production side, the profit motive is an incentive that gives us reason to hope.

However. This will only be the case if technology hasn’t also changed something about the environment in which memetic fitness is determined – i.e. human brains. If we have been so affected by frolicking in the internet’s content fountain that we actually secretly don’t want news any more, then the party is pretty much over.

*Is this true? It seems to be but I admit to having no data.

** Is this true? If it’s not true and substantive, is it a news story? Is it worth comparing a buzzfeed listicle to a news story if all they have in common is being comprised of words? These questions are not pursued any further in the work above.

Bring back core and non-core promises

The election is no longer “on the horizon.” It’s close enough to smell the sausages. Everyone involved in politics is working hard, trying to get us to listen, trying to get us to believe, trying to get us to vote.

Most of what they are saying is lies. Or to be a little kinder, false predictions about what they will do in the future.

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Labor’s policy list

Labor has set out 100 positive policies on its website.They’re really quite interesting and I recommend having a look.

But will it do them all? No way.

Take its plan to cut capital gains tax and negative gearing. These are very bold reforms any party would struggle to get  through the Senate.

And – despite recent reforms – the coming Senate is going to be a particularly mixed one.

Psephologist Anthony Green predicts eight Greens, three Nick Xenophon Teamers, either Glenn Lazarus or Pauline Hanson, Jacqui Lambie and an associated senator, plus probably one other odd-bod from Tasmania.

It’s a volatile mix that would wreak havoc on the most carefully-planned legislative agenda and laugh heartily at the very idea of a mandate.

And there is no guarantee of a mandate, for anyone. A hung parliament is quite possible, with independents and Greens set to make good runs in a range of lower-house seats. Nick Xenophon Team is a huge factor because it is competitive in some classic Coalition seats in SA. One expert tips six cross-benchers.

The odds of a hung parliament are 4:1 against and the closer the two major parties get, the better the chance a couple of independents (Yes Tony Windsor, I’m thinking about you) could have the parliament in the palm of their hands.

What all this means is that words spoken before the election – however earnestly meant  – cannot all come true.

Why don’t politicians admit that?

Instead of having broken promises littering the field of battle, creating the impression  “they’re all liars”, why not explicitly admit some outcomes are state-contingent?

They could make promises contingent on election outcomes:

“If we win a Senate majority we will pass all our policies. If not we will make health and education our top priorities.”

Promises contingent on Budget outcomes.

“If company tax revenue rises above $100 billion, we will fund a new hospital in Launceston.”

Or promises contingent on other promises.

“If we can get our negative gearing reform bill through, we will fund the building of submarines in South Australia.”

Politicians demur on hypotheticals for a reason – adherents of the more cynical schools of political communication will insist the complexity is too high for voters. And I’m sure the first few weeks after adopting this approach would be full of mocking.

The Leader of the Opposition is a maybe man, a possibly politician, an if-then individual,” the PM would jeer. “He’s built an escape route into every promise!”

Perhaps most politicians would wilt immediately under such ripostes – and the bad press that would follow. Gallery journalists – whose expertise in reading the tea leaves might be slightly less valuable in such a scenario – might be unwilling to give the approach a decent chance.

But maybe, just maybe, a  contrast would eventually become apparent between one side explaining their priorities and the risks and contingencies while the other side baldly claims things that can’t all come true will all come true. It just takes one politician floundering when asked, “But what will you do if you don’t control the Senate?” for that to become the favourite question of press-packs everywhere.

If so, the pressure for truth-telling would ultimately fall on the party that over-simplifies their plan. If that party won an election and then failed to keep their promises the consequences would likely be harsher, given the good example set in advance.

There would still be plenty of opportunity for broken promises. Sometimes politicians simply do the opposite of what they say they will, as Tony Abbott demonstrated after the last election.

But without the cover of all those things promised that were only really deliverable under very particular circumstances, the flat-out lies would be much easier to see.


Treasury Island

Originally published in the AFR Weekend Fin, 7-8 September 2013.

“Nauru is quite a pleasant island. Nauru is by no means an unpleasant place to live.”– Tony Abbott, July 30, 2013

He might say that, but he’s never tried it. I have. I was sent to Nauru by the Australian government because of the mandatory detention of asylum seekers. I was part of a grand bargain. Your land as a prison, in exchange for our money and expertise.

So I flew to Nauru – courtesy of Australia’s aid budget and my job with the Department of Finance – to be budget adviser to the world’s smallest island nation. That was five years ago. At that time, the Rudd government was just nine months old and the Pacific Solution seemed over. No Afghans or Sri Lankans shared the tiny nation with me. One of my jobs was selling things the Australian government left behind, including bales and bales of pajamas, to raise revenue.

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At that time, 2008, Nauru was fading from the Australian news. Now, since the re-opening of the detention center, it is back in the headlines.

A hellhole. That’s what they call Nauru. The name conjures images of razor wire, of enraged Afghans and Sri Lankans rioting amid smouldering buildings. It is becoming a byword for cruelty and deprivation of liberty.

But Nauru is more than a detention center. It is a community. For around 10,000 residents of the world’s smallest republic, it is home. It was my home too, for five months in 2008.

I felt welcomed there.

My job was to put together Nauru’s 2008-09 budget. A duty that was almost derailed, at the last possible minute, by a softly spoken man named David Adeang.

In 2013, Adeang is back in the cabinet. But in 2008, when I was there, he had recently been kicked out and become an outsider; a fringe MP.

It was not my first time in Nauru. I’d been there once before, in 2007, in the last months of the Howard government. My first trip was alongside a contingent from the Department of Foreign Affairs and Trade (DFAT), laying the groundwork for a new agreement between the two countries. Aid would flow as long as refugees could be accommodated.

Adeang was the finance minister and also the foreign minister and widely respected.

We gathered around a big meeting table inside Nauru’s Parliament House. Nauru’s cabinet sat on one side, the Australian delegation on the other.

The room was warm, and sweat stains slowly spread across the shirts of the participants, Australian and Nauruan alike. Fluorescent light glinted off the polish of the big wooden table.

The meeting was opened by the head of the Australian delegation. The senior diplomat began with a monologue, covering the sweep of history: the relationship between Nauru and Britain, Australia’s period of stewardship and the nation’s independence on January 31, 1968. As he drew closer to the point of the meeting – the memorandum of understanding – he paid his respects to the efforts of the cabinet ministers present in combating corruption and trying to right the ship of state, bestowing on them plaudits earnest and subtle.

He concluded triumphantly and invited Adeang, as the highest-ranking Nauruan government minister, to reciprocate.

“Thanks,” Adeang said. “What’s the first agenda item?”

Only the tiniest trace of surprise registered on the DFAT man’s face before he began a long discussion about the measurement of progress in the education system, about moving Nauru from inefficient portable generators to efficient ones, and reducing reliance on Taiwanese-donated diesel.

Adeang, clad in slacks and a Hawaiian shirt, spoke on each topic, although very softly.

The meeting wore on, through bursts of tropical rain that occluded all sounds in the room. I had long given up on attempts to listen to Adeang through the rain. As a junior officer, I was seated at one end of a very long table, and I figured if the really important people couldn’t hear Adeang, they would have said something by now.

A lot of time was spent talking about diesel. Nauru’s power station burned 40,000 liters of diesel a day, and buying that diesel consumed around half the country’s budget.

The electricity’s most important use was at the desalination plant that gave the nation its drinking water. The rest of the electricity went to homes. The country was divided into districts. Half had power at any time, half did not. After six hours it swapped. Power was out for half of every day.

But, in 2007, increasing the amount of power supplied was out of the question. The price of oil was more than $100 a barrel and rising, meaning reform was crucial.

Part of Australia’s aid package was funding to get rid of the rented portable generators that were so inefficient and move to more efficient permanent generators. There was a bit of tension at the meeting about this. The process had been going for a long time but the installation of new generators had not been completed. Assurances were made but not wholly believed.

It was just as a burst of rain was beginning to clear that the fluoro lights inside the meeting room blinked off. With gray rain spilling off the gutters outside, the dull conference room was immediately grim.

“I guess this is part of the negotiating tactics?” our senior diplomat joked, as the cabinet ministers looked up at the lights, or out the window.

“This actually hasn’t happened for months,” Adeang replied, looking genuinely embarrassed.

The power did not come back, before or after lunch. A few of the Aussies used the toilets before word got round that they wouldn’t flush without power. A foul smell reached the foyer outside the cabinet room as the afternoon of discussions progressed, ticking off items in the memorandum.

Adeang was unflappable through the whole affair. I saw the way people deferred to him and his command of the issues, and assumed he would be president before long.

But by the time I returned to Nauru in 2008, he was gone.

Adeang had been unseated as foreign affairs and finance minister, as part of the purge of the regime of President Ludwig Scotty. In his place was a medical doctor who had been trained in Australia, Kieren Keke, under a new president, Marcus Stephen, a seven-time Commonwealth Games gold medallist in weightlifting.

No one could really explain to me what Adeang had done – in such a small country someone related to the subject of gossip is always in earshot – but everyone agreed Keke, the new minister, was an excellent choice.

It was without much more thought to David Adeang that I began my work in the Ministry of Finance, got up to speed with the issues and began making the 2008-09 budget add up. I’d worked on budgets in Australia, where items below $500 million were all but waved through. Here the bottom line was $38 million. Every cent counted, and it was my job to count them.

I remember an extended email conversation with Nauru’s United Nations representative about provisions for her car. Why did the car have to be washed weekly? Could we not wash it monthly? Why did we need a driver? Etc, etc.

Every day, I would wake up in my enormous, sparsely furnished cliff-top home, marvel at the view of the Pacific, eat muesli with long-life milk, get in my AusAID-funded Hilux, and drive the 2 kilometers down the hill, past the hospital, around the airstrip to the government offices.

Of course, I could have gone the long way and circumnavigated the whole country. That would have turned the five-minute drive into a 20-minute one.

The island is about 4 kilometers across, about 5 kilometers from north to south, and rises to a maximum elevation of 50 meters above sea level. The entire population is concentrated along the low-lying edge of the island, where the road is.

The interior has been marred by phosphate mining. All that remains are coral pinnacles. Occasionally a barge would pull up and be filled with crushed coral pinnacles, destined for much lower-lying countries in the region, as Nauru exported its own unwanted land mass to help its Pacific neighbours build bulwarks against rising sea levels.

They are what is left after the phosphate was mined from among them. They are sharp and inhospitable, so the population lives clustered along the seashore – except for the asylum-seeker processing center. “Topside”, as the camp is called, is surrounded, not just by fences, but by stark coral pinnacles.

On the southern edge of the island is a runway, built by the Japanese, and on the edge of the runway is a small cluster of buildings, including the Parliament and most of the government offices.

My every working day in Nauru was spent in a portable building that housed the Ministry of Finance. My boss was the Secretary of Finance. Like me, he was an Australian government official on deployment.

I worked most closely with the budget team – a crew of Nauruans in their 20s, including two who had graduated from the University of the South Pacific and were earmarked as the best and brightest.

Part of the theory of sending foreign staff into a place like Nauru is the training and mentoring effect. The reality for most deployed staff is that, upon meeting what look like non-stop crises, active mentoring takes a back seat to leading by example.

One of my responsibilities was signing every spending receipt in the whole government. This was a big reform that had stopped money leaking out of the Nauru budget. Every cent of expenditure was confirmed by the Budget Adviser. It made sense, but it was an enormous pain.

Hundreds of complex spending receipts came over my desk every week. And then there was public sector pay.

Nauru had thousands of public servants, and every pay cheque had to be signed, by me or the head of the department. The Secretary of Finance did exactly what I would have done in his shoes, and delegated.

I saw and signed everyone’s pay cheque, from the president down to the gardeners who controlled weeds near the airstrip. The lowest pay was $180 a fortnight; the highest only about $350 – even for the president.

Nauru lived large – too large for too long. Now it was being forced to live within its means. Meagre wages for top bureaucrats and the president were part of the belt-tightening to which the new Nauruan regime had agreed. They wanted to bring their budget under control and were prepared to make sacrifices – one of the things I found most admirable.

I signed a thousand cheques a week. It took hours, and over the months I lived in Nauru, I wrote my own name so many times that it almost provoked an existential crisis.

I used to, when watching tennis, think ill of players who refused to sign autographs. I thought they must be arrogant, unfeeling. Now I wonder if they fear falling into a vortex of solipsism if they focus once more on the sight of their own name unspooling from the nib of a pen.

My precision eroded. To this day, my signature is a blurry swirl that would make my primary school handwriting teachers weep.

Signing cheques was the grunt work. The hard work was making the budget for 2008-09 add up.

The entire 2008-09 budget for the Republic of Nauru was on an Excel spreadsheet on my laptop, backed up on a portable hard drive, which I kept locked in the drawer of the old mahogany desk I sat at.

Most of the revenues were from aid. Nauru was savvy at using its nation status to its advantage – not just by handling our asylum seekers. In the United Nations, Nauru’s vote counts as much as the United States’, and it is one of a few countries to recognize Taiwan. Its vote was also welcome in the International Whaling Commission, so Japan was a generous donor.

As budget day got closer, the budget got bigger and more unwieldy. We figured out revenues, the balance got better. We got better estimates of expenses, the balance got worse.

Budget day was a Tuesday – just one of the relics of Australia’s colonial history.

The Friday before the budget was due for release, I felt like it was almost done. I came into the office on Saturday to do some last minute things, and ended up spending eight hours on last-minute adjustments.

On Sunday, as the nation’s inhabitants filled its many Protestant and Catholic churches, I guided the Hilux back to the office for a last burst to make sure all the rows added up for Tuesday.

At 2am, I signed off on 15 hours of last-minute jiggery-pokery. I was exhausted, but knew there would be more to do on Monday – more last-minute confirmations of key spending items, triple checking the bottom lines, formatting pages – the whole gamut of stupid things that take twice as long when sleep deprived.

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After four hours’ sleep, Monday dawned bright and sunny. We worked until we went out for a quick lunch. We worked until we went out for a quick dinner. We worked until we went out muddle-headed, finding ourselves looking out over the airstrip at 2am.

In the middle of the night, I realised I should make a new “to do” list every 10 minutes; otherwise I’d start making changes to the document, notice something else I’d been meaning to fix and start trying to do that. Efficiency was at a low ebb.

When the sun came up we were still working.

At 1pm, the last page was finally printed, collated and handed to the clerk of Parliament. I was dizzy with fatigue and my stupefaction was probably a threat to the population of the whole island as I guided the Hilux round the bend and up the hill to my home.

“In the office all night?” asked the guard on duty outside my cream-colored door.

“Yep. Too tired.”

I went for bed like a parched man stumbles into a desert oasis: headlong, blindly.

I felt as if my eyes had not been shut for a second when I heard a voice. “Jason!”

I ignored it.


I looked out my bedroom window.

There was my colleague from the office, Andy, walking round the backyard, yelling.

It did not make sense.

I lay down again.


It was Andy.


“You have to come into the office. We need you. Now.”

He disappeared.

I went outside to see the guard, wearing just my shorts.

“Is this for real?”

He confirmed Andy really had been there. Something was up. They really did want me to go back to the office.

At this exact moment the wind blew shut my front door.


I looked at the door, befuddled. My keys were inside. I wasn’t wearing a shirt or trousers. The guard intervened: “I can show you how to break in.”

He removed a bunch of louvres from one of the windows, gave me a boost, and I went through it, landing on the floor inside like a sack. I put on some clean clothes. Confusion was turning to anger as my focus returned.

If someone thought this was a funny joke to play on the Aussie, I’d be furious!

I helped replace the louvres, got back behind the wheel of the Hilux and went into the office.

It was no joke. The Finance Minister wanted changes that the Secretary of Finance decided only I knew how to make.

We went to visit the minister in his office. His changes made sense, even if asking for them at this stage seemed unreasonable. I went back to Excel and tweaked a few graphs, printed out replacement pages and had them inserted.

The document went to Parliament and I returned home again, turned on the TV and fell asleep on the couch at 6pm while trying to watch some rugby league.

I woke up 14 hours later and went for a swim. It felt good. I was free. Nauru’s fiscal future was secure. So I thought.

By Wednesday afternoon I had begun to feel human again, and visited the office.

Bad news. Parliament had not passed the budget. Parliament was not even sitting. The 19-seat Parliament was occupied by one man – David Adeang.

He was sitting in there and he refused to move. He was an MP, so precisely why his presence in Parliament – even on an immovable basis – prevented its business from operating was not clear to me. But I heard that the police were considering intervening, and that this was a big drama.

Eventually, wise words from former president Ludwig Scotty were enough to lever Adeang from the chamber, and discussion of the budget resumed.

But it was not passed that day, and as Thursday dawned, MPs found Adeang once again ensconced in the House, and he would not go. Once more a stand-off occurred before eventually Parliament resumed. The budget passed and was written into law, delivering a surplus of $120,000.

That night, in the members lounge upstairs in Parliament, there was a party with local delicacies noddy birds, which are caught with a lasso; small fish speared in the reefs; and cans of XXXX. The whole Parliament was there, and heads of departments.

I had a couple of drinks and watched everybody else celebrate the passage of a budget I was still a bit too tired to enjoy.

I left before the night got raucous, but all accounts and rumors pointed to one memorable moment. After a bit of lubrication in the wee small hours, the Speaker of the House apparently visited Adeang at his residence and invited him outside to settle things the old-fashioned way.

Adeang accepted, and despite his apparent advantage in sobriety he was defeated, the locals told me.

Was it true or just boasting? In the world of Nauru I was never sure. But after that point, I never saw Adeang again.

The day after that, we were having lunch with my budget team colleagues, Javan and Onassis, at Nauru’s best restaurant when we saw the Speaker roll up again, sitting in the back of a ute. He had a can of VB in his hand, evidently eking out every last bit of celebration the island could muster. His party was picking up some catering and he spotted us as he ambled in.

“F—ing finance team,” he said when he saw us.

He was normally a very nice man.

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Before it was a prison, Nauru was a prize. Germany arrived in 1888 and Britain wrested colonial domain from them in World War 1. Australia became the trustee in 1923, and was so until Nauru’s independence in 1968, except when Japan occupied the nation from 1942 to 1945.

The reason for the intense interest in this tiny, strategically null place is beneath the soil. Nauru is not the classic Pacific Atoll. It is rocky not sandy, and that rock is full of phosphate. I had known about Nauru’s phosphate since I was a small boy. In the center of Melbourne stood a building called Nauru House. One of the tallest buildings at the “Paris end” of Melbourne’s Collins Street, it was built in the 1970s and adorned with the 12-pointed blue star that represents the 12 tribes of Nauru.

My dad worked in that building when I was a child and I remember him telling me the story of a land rich in guano. So many birds had pooed there, he told me, that the whole country is made of poo, and they can sell it out from beneath their feet as fertiliser.

That Nauru is rich in guano is the most widely known fact about the country and one in which people delight.

It is not perfectly clear why birds – not renowned for control of their cloacae – fly the 1000 kilometers from the nearest substantial land mass with their buttocks clenched.

Geologists believe that the phosphate deposits are part guano, part limestone rock and part fossilised organisms from the seabed. Obviously, the guano component gets top billing in any retelling. My attempts at trying to inject geological accuracy into discussions of the island “made of guano” have disappointed enough people that I’ve learnt to let it slide.

Phosphate goes to make fertiliser and the price of phosphate rock has risen in line with the number of hungry mouths in the world to feed. For a long time, Nauru reaped the benefit of this trend. It was able to buy not just Nauru House in central Melbourne, but a global investment portfolio, including shopping centers in the United States.

Nauru’s standing and confidence was such that in 1991 it took a case to the International Court of Justice, forcing Australia to pay reparations for the phosphate mining during its period as trustee. Australia gave up $57 million in cash, plus an annual payment that was over $3.5 million in the year I had to balance the budget.

National statistics and bookkeeping have never been a strong suit, so the claim is hard to prove, but Nauru was probably once the richest country in the world. That makes it a very unusual “developing” country.

It has some terrific infrastructure, including a single road in excellent condition that encircles the island and a landing strip big enough to land a passenger jet on. The island is dotted with palatial houses, although many of them now house multiple families.

And people drive.

There are no traffic lights because there are very few intersections – remember, the only major road is a big circle – but Nauru has all the other trappings of car culture.

Despite having less than half the population of Alice Springs and, being just 5 kilometers across, Nauru boasts several petrol stations and a car hire company. When I was there, the roads were clogged with decrepit old Toyota LandCruisers, made into convertibles by removing the roof, and “postie bikes”, the little red Honda motorbikes used by Australia Post.

The President got around in a black limousine with driver.

Nauru’s money had disappeared. While bad investments don’t explain the whole story, they certainly play a part. The public height of Nauruan excess came in the 1990s. The country invested in a West End production. Leonardo the Musical: A Portrait of Love opened in 1993 . Nauru flew out members of Parliament for opening night, but reviews were far from supportive and the season lasted just weeks.

The government is now keen to avoid signs of excess.

I only needed to go to work to see why. Nauru’s government offices were nice and new. They were a two-storey block, with a really clever system of verandahs around it that meant you could navigate the whole place even under conditions of torrential rain. The Finance Department operated out of a portable building attached to the side of the main complex, but overall it was a highly satisfactory working environment.

Of course, the explanation for investment in exemplary workspaces was less uplifting. Deliberately lit fires had consumed the old buildings. Nauru’s motto was “God’s will first”, and the will of God was that displeasing things should be consumed by fire. The New Testament God wasn’t getting much of a look in.

The fall and rise of the mighty

My house was immediately next door to the grounds of the old presidential residence. It had evidently been quite something before the bright red flames of popular dissent removed its roof.

You could walk through the frame of the building and get a sense of its size but, where once lavish Turkish floor coverings had been, undergrowth was now shooting through, and a carpet of beer cans through the rooms showed that Nauruans were still keen to celebrate the fall of the mighty.

We had sunset drinks up there in the clifftop courtyard one night. The view over the suburb of Location below was expansive. Location has been described by some people as a slum. It provides the sort of obvious visual cue as to why the palace was rubble that any decent film-maker would leave out of the final cut for fear of patronising the audience.

The guards outside my house were there in case my AusAID Hilux and three-bedroom home provoked a similar feeling of resentment. But I felt perfectly safe the entire time I was in Nauru and when the guards were absent or in my garage lifting weights – which was often – it was not a concern.

In the years since there have been more than a few political bust-ups in Nauru.

In 2011, the president I worked for in 2008, Marcus Stephen, resigned. He was replaced by a man called Freddie Pitcher.

Pitcher, who had been resources minister when I was there, lasted six days before he was deposed in favor of Sprent Dabwido.

I remembered Dabwido from cabinet meetings. What had he been in charge of? I wasn’t sure. He lasted until a state of emergency was declared in May this year as Australia pushed to re-establish asylum seeker processing there. General elections were called.

Freddie Pitcher is gone but Keke and Adeang are in Parliament today. So are Scotty, Stephen and Sprent Dabwido. An MP called Baron Waqa, who I once saw fall asleep in cabinet, is now president.

Tumult caused by asylum seekers, a democracy that sometimes gets stuck, and a passing parade of leaders are just a few things Australia and Nauru share.

Nauru, in fact, is the only country where Australian Rules football is the national sport.

During my stay in the country, the Nauruan Chiefs travelled to Melbourne for the International Cup and took out fourth place, defeating the United States in the process. A proud moment.

Nauru’s obsession with Australian football goes beyond what would be considered normal in Australia. Some Nauruan children are christened with the names of their heroes. Judd, Akermanis, and Jesaulenko, all names of Australian Rules greats, could all be found on the football field together in Nauru.

The ties between the nations run deep.

Many Aussies have been to Nauru, from foreign ministers to taxi drivers, and almost all Nauruans had spent time in Australia during Nauru’s good years.

The Finance Minister to whom I reported had earned his bachelor of medicine from Monash University, and one of my colleagues in the budget team had attended Geelong Grammar.

Nauruans speak English with an Australian accent, which is lucky because the Nauruan language is all but impossible to decipher. I’ve managed to get my head around French and Chinese, and even picked up a little Japanese and Italian when I vacationed in those countries, but learning Nauruan was beyond me. The language has no links with other Micronesian tongues and many of its sounds can’t be mapped onto the 26 letters we are familiar with.

I was only supposed to be in Nauru for a little while. Aged 26 on arrival, I was younger and much more inexperienced than the kind of people that normally got sent in to do the job. But my replacement was delayed in his arrival and I ended up spending five months “on island”, as they say.

The easiest thing to do there was work. And after the budget, I found plenty more to do. After the budget became law, I took my place at my desk and looked over the budget papers. These were big initiatives: a bingo tax, and an auction of the goods that were being held at the old detention center.

I felt proud. We had put this transformational budget together. A budget that could help Nauru stand on its own feet. But I began to wonder: who would make sure these policies were implemented?

I knew the answer. Nobody.

That was the problem.

If this budget was to mean anything, the job was still not done.

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The trickiest policy was always going to be the bingo tax. Amid the constant phosphate royalties and the multiple streams of foreign aid (AusAID alone was worth over $30 million to Nauru in 2012-13), government had fallen out of the habit of taxing its people.

Deciding to tax was a big, brave move for a reformist government, but if Nauru was ever going to be in a position to survive without aid, it was necessary.

I wrote up a notice that explained the tax, and asked the most outgoing and socially gifted staff member to convey it to the bingo operators. The notice included the time and date of a public meeting that we would hold to explain the tax.

Next, I got on the phone with the police commissioner. He was a grumpy old Australian who rarely socialised with other expats. I went to meet him on the second floor of the government offices complex. He wasn’t ready and I had to wait.

“It’s not like we’ve got nothing else to do,” he complained when I asked for staff to visit the bingo operators and check they had their receipts. We parted with the agreement that he would visit some of the bingo operators, unless other matters of public order were more pressing.

Bingo was one of the biggest private sectors on Nauru. And it was by far the biggest operation run by Nauruans. Bingo was big business. The value of the prizes was often over $1000.

There wasn’t much other private enterprise. The restaurant sector was dominated by the few Chinese residents who made an ill-fated decision to migrate to Nauru during its boom. The other major going concern was Capelle’s: a supermarket slash car hire slash private accommodation business owned by an Aussie and a Nauruan.

The government, perhaps motivated by some anti-gambling feeling, decided bingo would be the focus of Nauru’s first tax. The tax was to be for 10 per cent of proceeds, but for simplicity, this was expressed as 10 per cent of the value of prizes. Simplicity in law-making is a trap, of course.

The value of the prizes was widely publicised before bingo nights, and big prizes were big drawcards, so it was assumed taxing the prizes would be easy.

The tax was a big risk for the government in many ways. It could have killed the whole bingo industry. It could have killed public bingo and led to even more “private bingo”, which everyone told me was happening in living rooms across the country.

It could have made some powerful and influential community members unhappy. It could have led to another outbreak of arson. It also could have been blamed on the Australians, and that was something I was keen to avoid.

We had a public meeting, at which 30 locals came to hear about the tax and ask questions. I was surprised at the number of bingo operators, large and small. My socially gifted colleague had done a great job relaying the importance of the meeting.

Parts were in Nauruan, so I couldn’t follow everything, but there were no raised voices. The whole thing took less than an hour and everyone assured me it had gone well. So the taxation began!

Revenue came in immediately. Bingo operations I’d never even heard of were tithing on a weekly basis, and from what I could hear (on Wednesday nights, a public address system announcing “legs eleven!” not far from my kitchen window), enthusiasm for bingo had not waned in the slightest.

Even better, receipts were up week on week. But then I noticed something funny. One bingo operator stopped offering cash prizes. The main prize one week was a motorbike.

I advised them we were taxing the value of the prize, and that if anyone offered a non-cash prize, they would need to submit a receipt, and we would take 10 per cent of the value from it. After a few more weeks of getting receipts for prizes, and seeing steady bingo tax growth, I was happy.

A loophole you can drive through

I moved on to other tasks, but the bingo operators hadn’t given up. One submitted a receipt for a used Toyota LandCruiser, bought for $100. I was not flabbergasted. The LandCruisers on the island were practically prehistoric, and most had been angle-grinded off at the top of the doors, so they were permanently convertible.

But the value of the prize pool was down. What was going on?

I checked with a colleague. He told me there was no way a LandCruiser, in any condition, could sell for $100 on Nauru. Cars were almost never imported, so second-hand cars sold at a premium.

He brought another piece of priceless local knowledge to my attention. The LandCruiser’s seller was the bingo operator’s partner.

I had a begrudging respect for the people outwitting me. I believe people respond to incentives. If you promulgate a set of rules, that creates loopholes, you have to expect people to clamber through them with glee.

We made a list of minimum values for non-cash prizes to govern the operation of the bingo tax, and the job of managing the issue eventually passed to my successor.

Worrying about tax administration was a sign of a relatively healthy and normal economy. In 2008, as the global financial crisis hit the rest of the world, Nauru was actually stabilising. But the process was never destined to be smooth.

After the July 2013 asylum seeker riots, Facebook messages posted by Nauruans were full of passion. Neither asylum seekers nor Nauruan politicians are universally loved.

Tensions are high, but by all reports, Nauru is now in much better shape than in 2008. The motto in 2008 was “your car is your phone”. If you wanted to talk to someone, you drove to find them. Now there is a mobile telephone network.

The start of asylum seeker processing means more aid and hotel rooms sold to foreign visitors. With that comes the hope to invest more in health and schools.

The future is not assured, warns Nauruan citizen Shonadeen Dowabobo. “Nauru has two major resources: phosphate mining and fisheries – the former being more scarce now than the latter,” she tells AFR Weekend by email.

Nauru is highly exposed to revenue fluctuation associated with asylum seeker processing, Dowabobo warns, and even investing the proceeds will not be enough to provide for the future if the Australian and Nauruan governments cannot agree to keep the processing center open.

“Nauru suffers from a history of corruption, poor leadership and mismanagement. It does not suffer from natural disasters or from fluctuations of the global market. It suffers from its leaders,” she laments from New Zealand, where she is studying accounting and economics.

But Dowabobo’s doubts about Nauru’s politics and economics do not get in the way of her love for the country.

As a long election campaign comes to a close and Australians go to the polls, her observations on what makes Nauru good are a reminder of what’s important.

“It is quite safe to go walk about at night and you can hitchhike almost anybody to go places . . . it’s not a ‘dog-eat-dog’ country’,” she says.

“I want to go back home.”

Paddling furiously below the surface

Sorry the blog has been so quiet! I swear I have been busy, just elsewhere.

Here’s a little slice of what I’ve been up to.


Why the drugs backstage at music festivals are now for arthritis.

Has Keynes wrested Defence policy from Kissinger?

Why money means more to the poor.


A nice story on the unexpected divergence of underemployment and unemployment.

A controversial piece bashing the idea of high-speed rail.

Some more truth torpedos about submarines.


The rise and rise of the SUV.

The rise and fall of the ATM.

Special bonus photos: 1. me (left) when they invited me on Lateline to talk the Federation; and 2. the blog’s editorial director, Susie Brown, making a few edits.