The state government’s strategy in dealing with Clive Palmer has echoes of a time past.
It’s not easy to like Clive Palmer, not that he cares, but the demonisation of the man in Western Australia is arguably a bigger story than his attempts to rescue a deal involving his mothballed Balmoral South iron ore prospect.
Local newspaper covers have shown Mr Palmer as either a cane toad or cockroach; but to what end?
One defence of the attacks is that Mr Palmer has threatened to sue the WA government for $30 billion, a claim that has angered Premier Mark McGowan and infuriated the broader population because it is such an outrageous demand.
But for the state government to hit back with a law aimed specifically at one man is remarkable, probably without precedent in Australia, and potentially ripe for a High Court challenge.
The background to the Palmer situation is the key to what’s happening, because it covers two important periods in WA history: the WA Inc years of the late 1980s, and early this century when the price of iron ore boomed.
Mr Palmer has made the bulk of his fortune in iron ore, not by mining anything but by selling tenements to gullible Chinese investors who didn’t do their homework; didn’t understand Australian conditions; and who capped it off by building a processing plant at three times the original budget and five years late.
What really riled the Chinese is that Mr Palmer not only laughed at them, he proceeded to defend his position in court, eventually winning cash from the original tenement sale and ongoing royalties.
Having sold the northern part of the Balmoral iron ore project, Mr Palmer wanted to see if lightning could strike twice with Balmoral South.
At no stage in the events mentioned above did Mr Palmer break the law, he simply moved quicker than anyone else and packaged up a sale to naïve buyers.
At some point in the process of Mr Palmer trousering his billions, it’s interesting to think whether the Chinese and WA governments disliked him more because he made fools of them rather than broke any law.
It’s also worth wondering whether what’s happening now is to help the Chinese solve a problem at their iron ore project near Karratha – the need to access more land to dump waste material.
And now we come to the latest dust-up in the Palmer saga, with the WA government determined to stop him from proceeding with his Balmoral South plan (something the government of Colin Barnett tried to do, and failed) through an arbitration process the McGowan government wants to stop at any cost.
Why is it so important to stop Mr Palmer, even to the point of passing special anti-Palmer laws and risking the reputation of WA as a safe place for business to invest?
The only answer to that question is that Mr Palmer has morphed from being a clever entrepreneur into a political enemy, which he is with his hard right-wing views.
Whether that’s a reason to upend the rules of dealing with government is another question.
The more disturbing issue is the spectre of a return of WA Inc days, a reference to a period in the 1980s when the WA government bent the law so it could do business with entrepreneurs.
This time the obvious difference is that the government is changing the law to avoid dealing with an entrepreneur rather than jumping in to bed with him.
Disturbingly, few people in WA see the connection.
The job of pointing out the problems caused by dispossessing Mr Palmer of Balmoral South is being left to the same people who were first to expose WA Inc, starting with Terry McCrann, formerly of The Age newspaper and now with the Murdoch press.
McCrann skewered WA politicians 30 years ago, well before most local journalists awoke to the issue.
It’s hard to avoid saying, “here we go again”, and there are differences with WA Inc, but it is possible to say that the Palmer situation is a mirror image of WA Inc because it’s appearing in reverse.
And just as no-one in the late 1980s had any idea how long it would take to unravel the WA Inc connections, or how much it would cost taxpayers, so it could be today, because once you start a legal fight you have no control over the outcome.
Mr Palmer has the capacity to finance a long legal campaign.
WA taxpayers should be prepared to spend the same amount defending what the government has started without knowing when the costs will end.
