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Transcripts
July 29, 2025
LAURA JAYES: Joining me live now, the Shadow Finance Minister, James Paterson. James, this is a pretty ominous warning from Donald Trump. We might get that 15% or even 20% reciprocal tariff. Do you read it that way, too?
SENATOR JAMES PATERSON: Well, if that does eventuate, Laura, that would be enormously disappointing. I am someone who considers myself a friend of America. I'm very fond of the United States, but I don't see how this is in the United States' national interests, and I think it's damaging to its relationships with its allies and its friends around the world. Of course, the Trump administration is responsible for its trade and foreign policy, but I am concerned by the way in which the Australian government continually seems to be surprised by these developments. In a moment of candour this morning on Radio National, Mark Butler admitted he had no idea that this was coming. He was reading about it on his phone as it was announced.
LAURA JAYES: Is that a great surprise? I mean, Trump hasn't given a say, heads up, this is really vintage Trump, isn't it?
SENATOR JAMES PATERSON: Good diplomacy, Laura, is anticipating and understanding what is happening and getting close to an administration so you understand their thinking, so you're not surprised by developments like this. Now, I absolutely concede this is an unconventional US administration, that it changes its policy, often at short notice. But I think there's enough evidence now in the public realm that we do have a problem in the bilateral relationship between Australia and the United States. It's more than 260 days since the president was elected. Anthony Albanese has still not sat down and met with him. And it is still unclear whether or not our ambassador, Kevin Rudd, has had a single meeting in the White House since the administration was sworn in in January. And I suspect we would know about it if he had. I suspect it would be all over social media if he had. So I think it's a reasonable inference now that there have been no meetings. So I just don't think we have that relationship of trust and closeness, and that is a big problem for our most important ally, our most important source of investment and one of our biggest trading partners.
LAURA JAYES: Maybe we need to offer him a bit of golf down here at Royal Sydney?
SENATOR JAMES PATERSON: Maybe, Laura, maybe it's golf diplomacy. Infamously, Joe Hockey, our former ambassador, had great success in playing a round of golf with President Trump in his first term. We now do know that Kevin Rudd made his way to a Trump golf course to have a spontaneous but probably very short meeting with President Trump, and since there hasn't been another one since, I think we can also reasonably infer it didn't go very well.
LAURA JAYES: I think you're probably right about that. I just quickly wanted to ask you one more question about Donald Trump before we get to AI, because Donald Trump was also asked about the situation in Gaza. He seems to have grown frustrated with Israel, and America has been Netanyahu's biggest ally over these last two years, almost, since October 7. But even he is saying, how can you deny what is happening in Gaza? Malnutrition. For many, it is starvation.
SENATOR JAMES PATERSON: Laura, I think every decent human being is immensely troubled by the images that we are seeing come out of Gaza. It is, appears to be a very serious, very dire humanitarian situation. And although I'm a strong supporter of Israel and I strongly support their campaign to dismantle Hamas and free the 50 hostages or bodies of deceased hostages that Hamas is still holding, I also accept that as the military power in the region which has effective control of Gaza, Israel does have a responsibility to ensure that the civilian population is fed, and they need to do all reasonable steps to make sure that that's the case. And it is doing harm, in my judgment, to Israel's international standing that they so far, in recent months, have not been able to do that. And I welcome the changes in policy and approach that have occurred over the last couple of days of facilitating the flow of further aid and further food into Gaza.
LAURA JAYES: Yeah, by air drops. I mean, did you see that opening of airspace? It was a big deal for Israel to do, to allow the UAE and Jordan to drop aid into Gaza. You know, there are questions about whether that is an effective way to distribute aid. We've seen the aid that is not getting out to the population there. Was that, do you think, an admission from Israel that it had gone too far in restricting food, or that international pressure was starting to bite?
SENATOR JAMES PATERSON: I'm reluctant to commentate on that, Laura, because I don't know what other considerations for the Israeli cabinet are on this, but it is welcome that they have made changes that will allow more aid to enter Gaza, because innocent civilians in Gaza should not be made to be punished for Hamas' crimes. But let's not forget, Hamas's crimes are very serious. They initiated this conflict. There was a ceasefire on the 6th of October. They initiated this conflict, and they prolong it every day by continuing to hold those hostages and by refusing to disarm. This conflict could end tomorrow. It is within Hamas' power to end it tomorrow by releasing those hostages and laying down their arms.
LAURA JAYES: But starvation should never be a weapon of war, particularly against children.
SENATOR JAMES PATERSON: Well, of course not, and I am not someone who accuses Israel of that. I doubt very much that that is a deliberate objective of Israel, and we have to recognise that these are incredibly challenging circumstances to deliver aid. There is an ongoing conflict with a terrorist organisation that hides among a civilian population and underground in tunnels where they hold innocent Israeli civilian hostages. So I'm not as quick as others to kind of criticise Israel for this, but I am making clear I think it is important that they provide the aid and the food that the population of Gaza needs to survive.
LAURA JAYES: But if there is some responsibility on Israel, you would agree?
SENATOR JAMES PATERSON: Well, of course, they are the military power in the region that effectively controls Gala. They have an obligation to ensure that people are fed.
LAURA JAYES: James, let's talk about AI. No easy way to pivot from that story, but this is something that we are covering day in, day out, the situation in Gaza as well. But AI is going to be part of the productivity summit, of course. The world is really grappling with how to deal with the rapid rise of AI. This is like no other time in human history, I think, about how AI might change the way we live and the way we work. But, I think it's important that governments do regulate, but not over-regulate. Where's that balance in your view?
SENATOR JAMES PATERSON: Well, you're right, Laura, artificial intelligence is changing the world and will change the world. And in a few years' time, the way we work and the way we live may be unrecognisable from just a few years ago because of the changes that AI will bring about. I think, overwhelmingly, they will be positive. Of course, there are some risks that need to be managed, and we've supported on a bipartisan basis legislation through the parliament, for example, to stop people using deepfake technology to create sexualised images of people without their consent. And of course, there are some very sensible contributions being made about child abuse material and other things. No one would dispute that. On the other hand, though, AI adoption and roll-out is inevitable. It is technological change and progress that no one can stop, certainly not Australia. And so the head-in-the-sand attitude of some players in this debate is only going to hold us back. And I particularly single out the demands that the ACTU, the union movement, is making of the Albanese government to allow workers to have an unlimited right of veto to prevent their employer from rolling out AI in the workplace, to introduce AI as a matter for collective bargaining when really collective bargaining should be limited to people's pay and conditions. I mean, these are absurd claims that some in the Albanese government, like Tim Ayres, the Industry Minister, appear to be entertaining that would only hold Australia back and mean we miss out on the enormous productivity benefits to be gained here. Now, there are people in the government that appear to understand that. Andrew Leigh is one of them. I'm very much on his side of this debate that we should be leaning into this adoption for the enormous productivity benefits it could bring.
LAURA JAYES: The unions are essentially doing what we expect them to do, saying they want the government to basically legislate that AI can't replace any jobs, that's just not reality. That's just not living in the real world. AI is going to replace jobs. It's how these jobs evolve and adapt. What should government's role be in that?
SENATOR JAMES PATERSON: Laura, the union movement has a very long history in Australia of trying to stand in the way of technological development, most infamously with the wide comb dispute where they wanted to make sure that shearers only used thin combs, which would shear a sheep more slowly than a wide comb because they thought that would cost jobs. That is how ridiculous the union movement's record is on technology adoption. And we don't want to see that happen in AI. So it is a test for the Albanese government, particularly at their productivity summit, that they must stand up against these unreasonable demands. They are absurd, and they would cost the Australian economy jobs and productivity growth. In fact, if the union movement is successful and stops Australian firms in adopting AI, all they will ensure is that those firms become uncompetitive and employees in those firms lose their jobs against competitors elsewhere in Australia or internationally that are successful in deploying AI. And there's now growing evidence about the productivity benefits, not just in the private sector but also in the public sector. You know, a UK government report found a saving of 26 minutes a day per worker from the rollout of AI. That might not sound like much, but over a year, that's two weeks per public service employee. And a Microsoft Australia study with the Australian government found that 40 per cent of employees who used it were being able to use their time on high-level tasks that only human beings can do, rather than lower-level, you know, basic tasks. So, these are immense benefits to citizens and taxpayers that could be derived from the productivity benefits of AI.
LAURA JAYES: Yeah, I think it's particularly unproductive to try and stop the flow, the tide of AI at the moment. James, we'll keep talking about this. Appreciate your time today.
SENATOR JAMES PATERSON: Thanks, Laura.
ENDS