Interview with Professor Geoffrey Garrett, US Studies Centre

Sky News Sunday Agenda program, 28th March 2010

David Speers: Geoff Garrett, thank you for joining us. First can you explain to us what
these healthcare reforms will mean for the United States and why they were so
contentious in congress?

Geoff Garrett: David, good morning. Healthcare really is the biggest social issue in the
US. The Obama legislation promises to add more than 30 million of about 40 million
Americans who currently don’t have access to regular healthcare to the regular
healthcare rolls. It also makes it harder for private insurance companies to keep people
out of healthcare because they have pre-existing conditions. So those are the two big
positives. What the critics say is that this is another gargantuan big government
program, about a trillion dollars over ten years, that’ll add to American’s debt and deficit
problems. And then I think if you’re sitting in Australia you’d say, well the interesting
thing about this is that it’s really a government subsidy to a private healthcare insurance
system. It doesn’t reform the backbone of American healthcare, it just adds more
government money to it.

David Speers: Indeed the fight hasn’t finished, because 13 states are now preparing
legal challenges against this decision in congress, now approved by the President as
well. Is this surprising? And how likely is a legal challenge, going all the way to the
Supreme Court?

Geoff Garrett: I don’t think it’s surprising at all because we have two real hot button
issues in the US on the table here. The first one is state’s rights versus federal rights,
and the second one concerns mandates. The Obama legislation tells Americans that
they must take private healthcare insurance, and if they don’t they’ll get fined for that.
So the states are saying that that’s violating the constitution. How will those challenges
go? I don’t know, but America’s a pretty litigious country and these federalism issues
tend to be pretty tough in court. So could it end up in the Supreme Court? Answer, yes.
How long will it take? Years, and not weeks or months.

David Speers: Unbelievable. Barack Obama didn’t win a single Republican vote in
congress. Does this show that he is only appealing to his base with this policy and
perhaps completely alienating the right?

Geoff Garrett: Yes, it’s interesting. I think over time this will be a trivia question – which
Republicans voted for anything that Obama wanted? So they have a ‘just say no’
approach at the moment to the government, and the expectation is that that’s going to
hurt Obama’s Democrats in the 2010 congressional elections. But of course the big
story in those elections at the end of the day is going to be the unemployment rate in the
US, which is currently at about 10%. No one thinks it’s coming down any time soon, so
the question for the Democrats is, can they prove to voters that they’re doing all they can
to help average Americans? Healthcare was supposed to do that, but we’re going to
move pretty quickly I think onto jobs, jobs, jobs, and the state of the American housing
sector.

David Speers: So you don’t think those midterm congressional elections in November
will necessarily just be a referendum on the healthcare reforms? They’ll have moved on
by then to the economy?

Sunday Agenda 28th March 2010 Geoff Garrett

Geoff Garrett: The healthcare obviously is an enormous issue, but if you think about the
first two years of Obama which is what we’ll be at by November 2010, you’ll have the
Obama reaction to the global financial crisis, which was bigger even than the Australian
in proportionate terms, plus healthcare, plus the international agenda, in an environment
where American debt, public debt is likely to go from under 50% of GDP before Barack
Obama came to power, to over 90% after his first term. So Americans are sort of
starting to worry about is this all affordable? Is the country going bankrupt in an
environment where not only is the headline unemployment rate 10%, but the number of
involuntary underemployed people, this is white collar workers who’ve had to take part
time jobs essentially, makes the effective unemployment number sort of something close
to 15%?

David Speers: Geoff Garrett, also during the week, in fact on Friday in the US, President
Obama announced on the phone he and the Russian President, Dmitry Medvedev, had
agreed to cut deployed nuclear weapons by 30%. Now I understand this accord
imposes a cap of 1,550 warheads. How significant is this?

Geoff Garrett: I think it’s politically very significant because the Obama administration
can say with some justification that this is a real move on from where President Bush
was. President Bush was having difficult relations with the Russians, mostly because he
wanted to put a missile shield into Eastern Europe, that the Russians opposed.
President Obama said I’m not going to concentrate on missile defence, I’m going to
concentrate on strategic arms reductions, and this is what you get. But if you take it in
slightly broader historical context, this is really a continuation of the post-Cold War
agenda. The US and the Soviet Union as it was used to have 2,500 or more warheads,
they want to modernise and reduce the number of warheads, so now we’ll be down to
1,500. That’s obviously a long way from a zero nuclear weapons world.

David Speers: Does it put more pressure on the likes of Iran and others to similarly curb
their nuclear ambitions?

Geoff Garrett: I don’t think so. The Russia/US story is an old Cold War story. The new
nuclear weapons issue concerns the smaller states, typically in Muslim countries, that
want to be nuclear powers, either because it increases their status on the global stage,
or because they want to have the threat of nuclear weapons. And obviously the other
big story this week was about Israel and US/Israel relations. Well, every Israeli politician
you talk to says that Iran is an existential threat to the state of Israel, and the US must do
something about that. I don’t think this deal with Russia will have much effect on that
question.

David Speers: Just finally, Barack Obama of course postponed his visit to Australia
during the week. They’ve slated in June for a more extensive visit and possibly bringing
the family. Do you think that will happen? Hard to look into the crystal ball too much
when it comes to presidential scheduling, but do you think that is going to happen? And
will that be a good thing?

Geoff Garrett: I think it will happen, and it’ll be a good thing. President Obama has said
he wants to be America’s first Pacific president. I think Indonesia and Australia are
important stops for him. Indonesia not only because of his personal biography, having
lived there, but also because Indonesia’s the largest Muslim majority country in the

Sunday Agenda 28th March 2010 Geoff Garrett

world. It’s had a successful transition to democracy and it’s marketising as an economy.
Australia’s important because it’s a traditional ally and Obama knows that geopolitics in
the Asia Pacific is changing and that the US must come up to speed on that. So being
more engaged in the region is very important to him and to his country.

David Speers: Geoff Garrett from the US Studies Centre, thank you.

Geoff Garrett: My pleasure, David.

Sunday Agenda 28th March 2010 Geoff Garrett