Here’s my article from last week’s Fin which it placed below the headline “ALP sold itself short instead of selling its strengths”. I’ve also done an interview with Michael Duffy on Counterpoint which was recorded last Thursday, but went to air last night.

How did it come to this? That’s what the last two Governments asked themselves as they fought for their lives in the last two elections. Howard had presided over a decade’s surging prosperity; the ALP Government had protected that prosperity with a fiscal stimulus that Economics Nobel laureate Joe Stiglitz described as world’s best practice: as good as it got – anywhere.

Part of the answer is to be found in this paradox: In seeking political advantage – in playing politics ahead of truth-telling and governing well – they ended up with a travesty of the very political objectives they were so desperate to achieve.

Take John Howard’s Workchoices. It was obvious that workplace deregulation would hurt Australia’s lower paid workers though Howard was right that it would help generate jobs for those even further down the pecking order. A frank acknowledgement of that could have saved Howard by creating the space around which he could have built a political and economic strategy to deal with the downside.

When Workchoices was cooked up, every time the Government of the Lucky Country looked, there was another few billion dollars in the kitty from surging company taxes on Australia’s miners. Usually playing political catch up, the Government shovelled it out the door as fast as it could – much of it to those battlers who were in the firing line of Workchoices.

So Howard could have focused those giveaways around the political economy of Workchoices and sold it as a wage/tax trade-off of precisely the kind that the Hawke Keating Government made a staple of their thirteen year reign. Instead he went out to sell the spin doctors’ message – that Workchoices would unchain our heart. Oh wait . . . that was the GST. Anyway you get my meaning.

The ALP Government managed to spin doctor its way to plenty of similar own goals including several right at the heart of its political viability. Some of us with some experience of government were stupefied to hear of the Government’s ‘root and branch’ review of taxation to report in an election year. I wondered what Rudd was thinking then. I wonder if even he knows now. But the announcement sure sounded visionary in the euphoria of the 2020 Summit.

Another trick from the political playbook is to divide your opponents. John Howard became so preoccupied with it that he tied himself into all sorts of contortions – like firing an environment minister for meeting quite properly with lobbyist, Brian Burke. Why? Because it seemed like a good idea in the 24 hours that Howard was going after Rudd for meeting with Bourke. Such frivolous invoking of the grave principle of ministerial responsibility only managed to highlight how much it was being traduced elsewhere. And it created an atmosphere of chaos. As in the dying days of the Whitlam Government, people wondered “What next?”.

Likewise the ALP Government focused as much on dividing its opponents over its emissions trading scheme as it did on the increasingly labyrinthine content of its own scheme. And then, famously walked away only to discover that its popularity had been built on the Australian people’s hopes for something better. We see political principle and political pragmatism as somehow in competition, but for a skilful politician – I’m thinking of Bob Hawke above others – they inextricably complement one another. As it learned in hindsight, in its passing pursuit of political opportunity it subjected itself to mortal political danger. Continue reading →