The-PM-Years-20

One touch of nature makes the whole world kin

William Shakespeare,

Troilus and Cressida

The second half of 2009 would come to be dominated by an increasingly large set of challenges, all rolling through the door at about the same time. For me, there were five big ones: winning the as yet unresolved diplomatic battle over the permanency of the G20; the continuing fight to keep the economy afloat; the hard decisions that had to be taken on the root and branch reform of the Australian health and hospitals system; the increasing number of asylum seekers coming to Australia by boat; and the policy and politics of climate change, including our preparation for the Copenhagen summit in December. The pace and complexity of these challenges would become all-consuming. They would place great strain on my staff, my cabinet colleagues and the ever-professional band of public servants who worked with us. And they would put great strain on me.

It was like we were doing two jobs at once. The first was dealing with the massive complexity of what we had to do, both nationally and internationally, not to allow the Australian economy and financial system to go under. This required vigilance. The economic data was often all over the place. We had to calibrate carefully what we were doing to make sure we had the balance right between stimulus and fiscal consolidation, between supporting the banks and not allowing them to become chronically dependent, between what we were doing locally while watching like a hawk the unfolding G20 agenda for the other major economies. This was 24/7 and unavoidably so. Then there was our second job, which was normally the job of a newly elected government: implementing our pre-election program, which in our case had been ambitious in its own right. This was full of its own policy and public finance complexity. Put the two jobs together, combined with a rabid Liberal Party and equally rabid Murdoch Party, it was no wonder we all felt under the pump.

On 2 July COAG met for the third time that year, and for the eighth time since taking office, in Darwin. I was pleased about that; I’d always liked the Territory, which is the genuine Australian frontier, and I wanted to see Darwin develop to become a genuine northern capital for the country for the twenty-first century.

The COAG agenda was once again full to overflowing. On the economy, we had already confirmed to the second meeting of the Australian Council of Local Governments in Canberra the previous week an immediate enhancement of $245 million (over and above the $220 million announced in the 2009–10 budget) to help build local government infrastructure across the country.1 On micro-economic reform, we agreed to a new, integrated, nationwide development approval process for both infrastructure and housing developments. The Housing Industry Association had told us that these reforms could save an average of $6500 on the cost of building a new home in Sydney, and $2500 in regional New South Wales.2

Darwin also saw the final formalisation of our National Partnership Agreements on Closing the Gap. This would prove to be of lasting significance, as it would be the first time that the Commonwealth, states and territories signed up to formal agreements which were anchored in the six Closing the Gap targets announced in the national apology. More importantly, it delivered an additional $5.2 billion in investment in Indigenous Australia over the following ten years.3

On climate change, we agreed on the first National Partnership Strategy on Energy Efficiency. This had involved a massive amount of work from officials over the previous twelve months, but the measures it contained were important to reduce Australia’s own greenhouse gas emissions footprint. They would include the banning of incandescent light bulbs from November 2009 and their replacement with compact fluorescent bulbs, thereby reducing emissions by up to 800,000 tonnes per year.4 The strategy also involved the phasing out of inefficient hot-water systems from 2010.5 Then there would be new national legislation for energy efficiency ratings for all electrical appliances and new homes, so that consumers would know precisely what they were buying. This was the first strategy of its type in the country’s history. It would remain in force until December 2015, when COAG would replace it with the National Energy Productivity Plan.6 I’m proud of this legacy of our government’s work.

Following COAG, I would travel to the Kimberley to sign the Ord River Stage 2 agreement with Premier Colin Barnett, then to Melbourne for an Italian community fundraiser for the appalling earthquake in the Abruzzo region, before going on to Sydney to launch the building of 3500 homes as part of a stimulus package plan.

After a fair bit of domestic travel, I headed overseas for a week: to Kuala Lumpur to see Najib Razak, the newly sworn-in prime minister of Malaysia, before going on to Berlin to lobby Angela Merkel, the German Chancellor, on the future of the G20, and finally to a Major Economies Forum on Energy and Climate in Italy.

The flight to Berlin felt bloody long after a torrid couple of weeks, but I was looking forward to having further contact with the Chancellor Merkel. She was competent, courteous and willing to develop relationships with parts of the world beyond the political ecosystem that was the European Union. The agenda for our meeting in Berlin was very much about the future of the G20 and what the two countries could do in the lead-up to the Copenhagen conference. Bilaterally, we’d been working hard with the Chancellor’s office and I was delighted when, not long before my visit, Chancellor Merkel made a positive speech on the future of the G20 beyond the immediate needs of the crisis.7 If we had Germany fully on side in our quest to make the G20 a permanent global institution, we were starting to cook with gas. I was also confident that things were moving in our direction in Washington. Although the French would fight a rearguard action to the end, our diplomatic campaign over the previous nine months had finally borne real fruit. In time, this would be a major and permanent win for Australian diplomacy.

Arriving in Berlin on the RAAF flight from Kuala Lumpur, I couldn’t help but think of previous times the RAAF had been in Berlin airspace, such as the Berlin airlift in 1948 or the bombing raids during the war as part of the RAF Bomber Command. No city in the world can so readily bring back the ghosts of history like Berlin.

I was drawn from these grand reflections to deal with the more mundane task of getting dressed and ready for the ceremonial welcome on the ground. All was going well until I discovered I couldn’t find my shoes. I looked everywhere. Granted, I was tired, but how on earth could I lose a pair of shoes – the only pair of shoes I had with me, my size 10 R.M. Williams – on a 737? There were only a limited number of places they could have been put. The plane landed. We taxied. Still no shoes. I looked out the window and saw a military guard of honour, a red carpet, and a long line of limousines some distance from the plane. The thought of arriving for the first time as Prime Minister of Australia in the Federal Republic of Germany wearing only my socks was a problem.

Our ambassador, as per custom, came on board together with the German chief of protocol. I said I needed a few more minutes before I would be ready to ‘deplane’. At this stage, my staff were in full panic mode. I turned to Andrew Charlton and asked, ‘What size shoes do you wear, Andrew?’

‘I’m not telling you,’ he replied.

‘Andrew, this is a national emergency – what’s your bloody shoe size?’

Reluctantly, Dr Charlton, senior economic adviser to the Prime Minister, sat down and removed his particularly groovy, Elvis-like pair of very pointy shoes and handed them to his increasingly desperate boss. They were two sizes too big. And when I put them on, I looked like a 1960s rock-and-roll star. I feared that when I walked down the stairs of the aircraft, I might walk right out of them. To lessen the likelihood of such humiliation, I stuffed some socks into the toes of each shoe.

And then we were off. Trumpets blared. Ceremonial guards stood to attention. Pleasantries were extended. All as I walked briskly in a sort of sliding shuffle towards a big, black Mercedes Benz that represented a welcome place of sanctuary for a sartorially-challenged prime minister.

In the meantime, Charlton had deplaned from the rear of the aircraft with the rest of the staff, marching boldly across the tarmac in his socks before sliding into the front passenger seat of my own vehicle. He swung around from the front seat and, with a broad grin, said: ‘PM, that was a serious arsehole act.’ Our ambassador was somewhat taken aback by the familiarity with which my staff spoke to me. I said: ‘Andrew, now you understand the definition of the concept of the national interest. I’ll buy you a new pair in town.’

With me still in my Elvis shoes, we made a scheduled stop at the Commonwealth War Cemetery in the middle of Berlin, which was home to the remains of hundreds of Allied flyers who had lost their lives during the war; among them were many Australians. After a memorial service, we then headed briefly to the Hotel Adlon – a favourite with Hitler both prior to and during the war – before travelling to the Chancellery for my bilateral meeting and working lunch with Angela Merkel. By this stage my R.M.s had been found. One of the RAAF flight attendants had helpfully stored them in an obscure cupboard, beneath a pile of blankets. Mindful of my previous experiences with RAAF flight attendants in Papua New Guinea, I elected to deploy absolute diplomatic silence. All’s well that ends well, I reasoned – for me, if not for Charlton.

The bilateral with Angela Merkel led to a great meeting of the minds. Germany saw clear virtue in sustaining the G20 long into the future. On that we were agreed. We also discussed the need for the upcoming Pittsburgh conference in September to develop a coordinated strategy for economic growth in the post-crisis period, including the unwinding of temporary stimulus measures and the return of global budget deficits to balance over time. The Germans had already floated with us their proposed Charter for Sustainable Economic Activity,8 which dealt with these questions specifically, as well as including principles for long-term social and environmental sustainability in the post-crisis world. It would go on to form the basis of the Pittsburgh Declaration on Balanced and Sustainable Growth, which remains the core framework for the G20 to this day.9 We spoke, too, about our combined military contributions in Afghanistan,10 but the bulk of our remaining time was spent on how we were going to secure a positive outcome at the upcoming Copenhagen summit on climate change. Germany had been a force for good on this question, and I encouraged the chancellor to become even more active in Germany’s global diplomacy, in partnership with Australia, in the lead-up to Copenhagen. The meeting went well.

After a brief stop in Zurich to launch the unsuccessful Australian bid to host the 2022 FIFA World Cup, it was then on to Rome. Sepp Blatter, a Catholic, asked me to remember him to the Pope. Perhaps he was hoping for absolution should the corruption behind the bidding process for the 2022 World Cup eventually come to light.11 We now know Australia never stood a chance. I elected not to raise the state of Mr Blatter’s soul with Pope Benedict when we met in the papal apartments at the Vatican. Instead we discussed religious freedom in China and Vietnam, and the upcoming Copenhagen summit. The good Sisters of Joseph back in Sydney had also asked me to put in a delicate word in support of the canonisation of Mary MacKillop, which I duly did.

The central objective of my travels still lay ahead of me. This was the Major Economies Forum – which was effectively a G8 plus 7 – where we would discuss the six months leading up to the Copenhagen summit in December. Over the past several months, I’d had a number of conversations with the MEF host, Italian prime minister Silvio Berlusconi. Silvio was a unique character. His original plan was that the forum should be held at his resort on the Sardinian island of La Maddalena. A few of the international leaders, myself included, were uncomfortable with the idea of travelling to Silvio’s private resort for a conference on climate change in the middle of the Global Financial Crisis. I thought it would be a very bad look. It had been delegated to me to raise with Silvio that this mightn’t be an ‘entirely wise idea’. In one of my telephone conversations with him, he assured me that a great time would be had by all. In fact, he encouraged me to bring my own personal yacht. On telephone calls such as this one, which I took in the prime minister’s office in Canberra, it’s customary for note takers from the Department of the Prime Minister and Cabinet to sit across the desk with earphones on so they can take a verbatim record. These public servants are trained never to reflect any emotion, but at the mention of the yacht these guys just cracked up. I must admit I did too.

‘But, Silvio,’ I said, ‘I don’t have a personal yacht. And I’m unlikely to have one in the future. Besides, it’s a very long way to sail from Australia to Sardinia.’

After a long pause on the other end of the telephone, Silvio replied, ‘Kevin, I know you’re a socialist. But there’s no need to worry. Because I’m going to lend you one of my yachts.’

I sensed that we were not making a lot of progress, so I hauled up my white flag and told him I would see him in Sardinia. This island resort, as it transpired, would be the scene of Silvio’s famous ‘bunga bunga’ parties with various of his friends from across Europe.12 Given the furore when news leaked of my 2003 visit to Scores in New York, a visit to La Maddalena would have been extremely unwise.

As it happened, after the tragic earthquake in Abruzzo in May, Silvio had a change of heart. The 9 July summit was moved to L’Aquila, capital of the region. The conference venue at L’Aquila was a far cry from what I’d read of La Maddalena. Suddenly we were staying in military barracks. In fact, it was positively spartan. I was delighted – until I found a treasure trove of personal gifts from our generous host. These ranged from personally tailored suits, shirts and pyjamas (monogrammed) to exquisite Italian leather briefcases, desk sets, watches and more. Alas, there was no yacht. I couldn’t surrender the gifts to the Australian protocol officers travelling with us quick enough. It was classic Silvio.

Our staffs had arranged for President Obama and myself to walk to the conference centre together the next morning. When we met, Barack took me to one side to ask whether there’d been any gifts in my room. I smiled and confirmed there had been, and that we’d probably all received them. ‘But the US being a superpower, you probably got more than the rest of us put together.’ We were both killing ourselves laughing as we walked in.

The conference itself was surreal. I was able to hold a number of bilateral meetings with the British, the Japanese, the French, the Canadians, the Russians and others about what lay before us on the road to Pittsburgh and then on to Copenhagen. These were genuinely useful opportunities. But the plenary discussion was very strange indeed. For reasons best known to himself, and unbeknown to the rest of us, Silvio had taken it upon himself to invite Muammar al-Gaddafi of Libya to the conference. (I’m not sure whether he had brought his infamous Bedouin tent with him to L’Aquila, but he was travelling with his quite remarkable, exclusively female, personal bodyguards.) President Hosni Mubarak of Egypt was also there. Apparently it was the prerogative of the host country of G8 meetings to invite various guests of their own choosing, usually from the developing world. Obviously Italy had long had an engagement with North Africa, but this seemed to be taking things to extremes. Fortunately, the table was a very large one. I was seated throughout next to President Obama, and we exchanged notes on how to make the most rapid exit possible from the plenary without causing offence while also avoiding being photographed with Gaddafi.

At the end of these meetings, it also falls to the chair to sum up proceedings. Silvio decided to tell us all about his most recent policy priority: anti-ageing therapies. This he saw as a new global growth industry. We all listened, nodded politely, and hoped that the record of this meeting would never be released while any of us were still in office. Just prior to summing up, Silvio worked his way around the room offering each of his guests one further expression of his personal generosity, in this case our own choice from a display case of expensive wristwatches. Both Barack and I declined. L’Aquila was turning out to be an unusual meeting indeed. There was, however, a highlight for Australia when – flanked by Silvio Berlusconi and Barack Obama – I launched the Global Carbon Capture and Storage Institute13 which I had established back home; it seemed an appropriate venue given that carbon capture and storage had been endorsed so forcefully at the previous year’s G8 summit in Japan.14 The launch was supposedly to be a relatively small-scale affair. But through a series of hilarious choreographic mishaps from our Italian hosts, it ended up looking like the main event for the entire conference, with Barack and I flanked by all other G8-plus leaders, and several hundred cameras flashing, as I explained the importance of the Australian CCS initiative to the entire world. As Gordon Brown remarked appreciatively, ‘Absolute Aussie chutzpah!’ Of course, he was right.

Climate change remained in the global spotlight when I hosted the Pacific Islands Forum in Cairns on 5–6 August. Whereas Howard and Downer had been largely indifferent to the fate of the Pacific, aside from their late intervention in the Solomon Islands, I was determined to demonstrate an entirely different approach. And part of this was to cause each of our Pacific friends to feel welcome in Australia and to treat each of them with proper respect. I was concerned about long-term strategic drift right across the region. Many of these countries’ economies were thin. The various microstates in the region were geographically isolated, separated by vast distances, and with limited lines of transport and communication between them. As for democracy, a number of these states were in a fragile position, most notably Fiji. And if Australia failed to act effectively as the region’s strategic and economic protector, others would step into the breach. To deal with these problems and others, I’d worked long and hard on reframing our bilateral aid relationships with each through what we had called Pacific Partnerships for Development. In addition, I’d been in deep dialogue with the United States Pacific Command to try to work out how the US, Australia and New Zealand could effectively patrol the exclusive economic zones of these microstates to protect their fisheries from being ravaged by Chinese, Taiwanese and Japanese commercial fishing enterprises, with little or any return to the local people. The third big area of reform we had worked on prior to the forum was to bring about complete aid transparency across all the external donors, including Australia, New Zealand, the US, Japan and the Europeans. Australia contributed more than 50 per cent of all development assistance to the region.15 But it was important that we maximised our collective efforts through a more coordinated approach governed by common goals. Everyone signed up except China. To my chagrin, Beijing simply ignored the proposal for a regional aid transparency charter, but not before I publicly hauled their delegation over the coals in our plenary session for ignoring regional consensus on such a vital concern. It won me no friends in Beijing for doing so.

Our additional purpose at that year’s Pacific Islands Forum was to adopt a resolution on climate change to take to the upcoming meetings of the G20 in September, the Commonwealth Heads of Government meeting in November, and Copenhagen in December. The rising sea levels in Tuvalu and Kiribati, as well as the Maldives in the Indian Ocean, became emblematic of the human impact of climate change. The forum resolution would prove to be a terrific document that Australia could use in each of these upcoming summits, as we sought to bring the region’s message to the world.

August was also a big month for domestic action on climate change. By that stage we had our two core pieces of legislation before the parliament: the Renewable Energy (Electricity) Amendment Act 200916 and the Carbon Pollution Reduction Scheme Bill 2009.17 Penny Wong, supported by Greg Combet, had done a brilliant job preparing both these pieces of legislation, undertaking extensive industry consultation in both cases. Furthermore, we had a clear election mandate to legislate both these bills. But Turnbull had the CPRS voted down in the Senate on 13 August. The Liberals had capitulated to the resources companies, as well as the steel and aluminium manufacturers. I still wonder whether Turnbull could have prevailed over his party in the lead-up to the August vote had his political authority within the Liberal Party not imploded over the Godwin Grech affair in June.18 Perhaps this was an early indicator of the Turnbull we would come to know in later years: when he found himself in political trouble, he would jettison all semblance of principle in order to survive. It should also be emphasised that, in voting the legislation down, the conservatives had repudiated their own pre-election pledge to bring in an emissions trading scheme themselves.

Of course, their partners in political crime, for equally opportunistic reasons, were the Greens. Their formal argument for voting down the CPRS was that it wasn’t ambitious enough,19 but they would never be able to explain why, if this was so, they would subsequently support a less ambitious approach during the next parliament.

It was not all bad news that August on the climate change front. I’d been deeply wedded to the future of the Australian renewable energy industry and our pre-election commitment to increase the mandatory renewable energy targets from 5 per cent to 20 per cent by 2020. The whole point was to increase the ‘critical mass’ of the renewable energy sector, so that by the time a carbon price fully kicked in under the CPRS, both industry and individual consumers would be able to source their energy supplies from elsewhere. The Liberals had no particular political commitment to this proposal. In fact, their explicit pre-election support for an emissions trading scheme, they had not produced a pre-election commitment to match our own on the renewable energy target. Nonetheless, for political reasons, they did not want to be portrayed as complete climate change vandals. They judged it to be politically expedient to vote for the bill, so that at least they would have something to hang their hat on when they were challenged on their overall climate change credentials. I remember feeling a deep sense of personal satisfaction when the bill was finally passed by the Senate on 20 August, which was also my son Nicholas’s twenty-third birthday. We had two things to celebrate at the Lodge that evening.

This bill, more than any other initiative over the decade that followed, would help the Australian renewable energy sector to grow from ‘boutique’ to become part of the industry mainstream. The sector would generate tens of thousands of new jobs across the country. And supported by the various other renewable energy investment initiatives we had created, this has been the main contributor to the moderation of Australian greenhouse gas emissions over the last decade, during which time Australian renewables went from just 4 per cent of Australian total energy supply to 17.3 per cent.20 This has been the biggest single change in the Australian energy mix in a hundred years.

On the wider economy, the Liberal Party had suddenly grown quiet. That was not only because we had successfully navigated the March quarter of 2009 without going into recession. When the June quarter national accounts came out in early September, we had managed to clock up a more than respectable positive growth number of 0.6 per cent21 compared with a 0.4 per cent increase in the previous quarter.22 Compared with the rest of the advanced economies, this was a stupendous performance. For the first time, I felt as if we might finally have come through this thing. However, we still had to sustain the pattern of global economic recovery, financial regulatory reform and the restoration of global fiscal and economic balance following the global stimulus package agreed in London – all of which would be central to the agenda of the upcoming G20 summit in Pittsburgh in September.

Before leaving for the United States, I announced the appointments of Kim Beazley and Brendan Nelson as our ambassadors to the United States and the European Union respectively.23 I knew for a fact that Kim and his wife Susie hated me with a liquid passion; that much had been reported to me from colleagues right across the country. But I felt no malice towards them at all. I also believed that Kim had great strengths that we should deploy. I had discussed with foreign minister Stephen Smith where we should send him. My view was that, as a former leader, deputy prime minister and defence minister, Kim deserved to be treated with respect. I was determined to see him appointed to a major diplomatic post. Which is why I was surprised when Smith – who, together with Wayne Swan and Stephen Conroy, a longstanding friend of Kim’s – said Kim would not be an appropriate choice. He argued that Kim was too old-fashioned to be able to form an effective set of relationships with the new Obama administration. I replied that with Dennis Richardson returning to Canberra to become head of the Department of Foreign Affairs and Trade, I couldn’t think of anyone better than Kim for Washington. Kim had always been pro-America. He was obsessed with the American Civil War and prided himself on being an amateur military historian. Given the intensity of the military relationship between our two countries, I thought he would be a great fit. No one had lobbied me on Kim’s behalf for this although I had been approached, on Kim’s behalf, the previous year to see if I would nominate him as governor-general. In fact, Chris Bowen had heard from Kim that he didn’t believe I would appoint him to anything. I kept my counsel, before eventually telling Stephen that I had made up my mind. I then rang Kim directly. Kim seemed to be genuinely disbelieving of the good tidings I had for him. He would go on to serve in Washington with distinction.

If Kim was disbelieving, Brendan Nelson was incredulous that I would offer him an appointment. I told Brendan, who had previously served as defence minister and leader of the Opposition, that I saw Brussels as a useful political post where someone could work effectively across the arcane political processes of both the European Union and NATO. In Brussels, bureaucrats could only go so far. Given that most of the EU commissioners were former political leaders of one form or another, I also thought it would help Australia to gain greater traction in our overall relationship with Brussels – a relationship we were seeking to take to a whole new level because Europe remained a major global actor. Brendan would also go on to do a great job.

When I arrived in New York that September, I used my addresses to the UN General Assembly24 and to the US Foreign Policy Association to drive home our message on the centrality of the G20.25 This was a hard message for the UN community to hear; while it was all fine for G20 members themselves, what about the other 173 members of the UN General Assembly? Once again this brought into sharp focus the continuing debate between legitimacy and effectiveness of multilateral institutions: whereas the UN had perfect legitimacy given the democracy of states it represented, it could no more have responded quickly and effectively to the Global Financial Crisis than my big toe. It was not a central part of the UN’s mandate. And as for the rest of the multilateral machinery, the IMF had neither the mandate nor the resources to deal with challenges of this order of magnitude. Thus, as I had the previous year, I used my UN address to outline the need for an effective multilateral institution to deal with the crisis – one with more legitimacy than the G8, given that members of the G20 came from every continent on earth and every major religious tradition, as well as representing 90 per cent of the global economy.26 Still, at the home of multilateral purism at UN headquarters at Turtle Bay, it was a hard message to sell.

As for the American position on the future of the G20, both Andrew Charlton and I had been hard at work with our counterparts in the White House. I decided the best way ahead was to write formally to President Obama outlining the case in the weeks leading up to the Pittsburgh summit. I was overjoyed when, not long before arriving in Pittsburgh, we finally got the message from the White House that the G20 had been given the green light for the future.

In the months leading up to the Pittsburgh summit, I had also spent a lot of time on the phone rallying the troops in support of the G20’s long-term status. Apart from ourselves, the likely casualties if the French had their way with a smaller G12 or G15 would have been South Korea, Indonesia, Saudi Arabia, Turkey, Mexico and Argentina. Our French friends were busily organising a rearguard action to prevent the G20 from becoming permanently entrenched; President Sarkozy considered anything that meant the dilution of French global influence to be unacceptable. Fortunately, we already had the Chinese, the British and now the Germans on our side. But Brazil, Japan and Italy supported the French. India’s position was simply too difficult to gauge. So I resumed my customary position of being the G20 ‘shop steward’ in mobilising the potentially disaffected. I encouraged both the Argentinian and the Mexican presidents to turn their attention to President Lula in Brazil, which they did with great effect. And given the role France sought to play in the Arab and Muslim worlds, I suggested to my counterparts in Riyadh and Ankara that they might want to turn their attention to Paris. The South Africans were also helpful on our behalf. There were many, many midnight calls during this process, but I did not want to leave any stone unturned.

In Pittsburgh, the challenge for us all was to agree on a communiqué that embraced the transition from temporary stimulus to medium-term fiscal repair, before returning to long-term, balanced, sustainable economic growth. The latter, in particular, meant identifying the future growth drivers beyond the asset bubbles of the past – whether it was the dot-com bubble of the 1990s, or the real-estate bubble of the 2000s which had landed us in the subprime mire, the resulting financial crisis and then the global economic recession. I would argue at Pittsburgh that there were three prime candidates for new global growth drivers: trade, through the positive conclusion of the Doha round; a global infrastructure investment drive to turbocharge the implementation of the millennium development goals; and a global renewable energy revolution to deal with climate change.

The G20 Leaders Statement at Pittsburgh27 has essentially remained the operating mandate for the G20 ever since. This Framework for Strong, Sustainable, and Balanced Growth was a carefully negotiated work plan for the future. It was, and remains, a good document. The plan included an even more specific program of financial regulatory reform to be undertaken conjointly with the Financial Stability Board, the Basel Committee on Banking Supervision, and the G20 meeting of finance ministers and central bank governors. This work would become the foundation stone for the Dodd-Frank Act of 2010,28 aimed at reining in financial excess. The Leaders Statement also dealt with the reform of the IMF, which would eventually result in an increase in China’s quota and later in the introduction of the Chinese currency into the SDRs, or strategic drawing rights, of the IMF – effectively an official international reserve made up of a basket of currencies including the US dollar, the euro, the yen and pound sterling. The statement also proposed an expanded mandate for the multilateral development banks, led by the World Bank. Pittsburgh formally reaffirmed the principles of global free trade, empowered the World Trade Organization to monitor any protectionist measures by member states, as well as establishing a $250 billion trade finance facility to keep exports and imports flowing until markets were fully restored to normalcy.29

For me, however, the single most critical provision of the Pittsburgh Leaders Statement was the first sentence of paragraph 19. It read: ‘We designated the G20 to be the premier forum for our international economic cooperation.’30 In a single sentence, the international diplomacy in which I had been engaged for the past twelve months had achieved its final goal. Not only did Australia have a seat at the top global table, it was now a permanent seat. At last I’d achieved my goal for the country for the long-term future.

The next day, for the first and probably last time ever in my international travel as Prime Minister, I actually took a day off. I’d long been a fan of the great American architect Frank Lloyd Wright, and his masterpiece Fallingwater – an extraordinary modernist home from the 1930s cantilevered out over a waterfall – was within an hour or so of Pittsburgh. Thérèse and I had a wonderful time that day. It was a truly beautiful piece of architecture. In line and form, Wright had been a man ahead of his time. There was also something of Asia in his design, an early blend of east and west. From Fallingwater to the Guggenheim Museum in New York, Wright had a capacity to see the future well beyond the comfortable, comforting, almost self-assuring patterns of the past. And while he would always bring the best of the past with him into his new designs, with Fallingwater, as with his other achievements, he was always brushing up against a future which the rest of us could not yet see. For me, his aesthetic was the perfect metaphor for the new architecture we were seeking to construct for the world.