If I never hear another Labor “strategist” claim that the ALP lost because of Howard’s “great interest rate lie” it will be too soon. As Paul Kelly pointed out on the ABC TV Insiders program this morning, the real reason Labor lost so badly was because most of the polls showed that voters simply believed the Coalition were better economic managers to the tune of as much as 30 percentage points. In dangerous but prosperous times, that makes the “devil you know” decision a no-brainer.
The irony is that Howard’s reputation as a good economic manager is at the very least dubious and extremely vulnerable to attack.
Update – (Monday 11 October) this SMH article by Tom Allard and Mark Metherell provides a good summary of many of the shortcomings of Labor’s campaign, and makes some of the same points as my post.
Apart from the GST and initial “first wave” IR policies, Howard has tackled little in the way of meaningful economic reform during his 8 years in power, contenting himself with piggybacking on the economic reform hard yards previously gained by Hawke and Keating. He’s allowed dangerously high private debt levels and a distorting housing “price bubble” to develop; done nothing to prevent manufacturing industry from stagnating; and failed to foster education, training, industry R & D or capital investment, or productive public infrastructure (except the Darwin-Alice Springs railway). Meanwhile, Howard spent up big during the election campaign on an orgy of cynical, wasteful, economically stupid pork-barrelling promises. Yet Latham made little or no attempt to dent Howard’s unjustified reputation as a good economic manager, either before the campaign or during it.
As Kelly argued, unless and until the Coalition stuffs up and presides over a recession, Labor isn’t going to win government solely on its health, education and environment policies, not even (or perhaps especially not) with a strategy of labelling Howard as a “lying rodent”. Australians generally assume that all politicians are lying rodents, and the fact that both sides spend much of the time accusing each other of telling porkies merely confirms our cynical judgment.
There’s a strong argument, as Kelly also said, that Latham’s decision to jump into bed with Bob Brown and the Greens made things worse for Labor on the mainland as well as Tasmania. The ALP was seen as selling out the workers as well as cosying up to the extreme leftie Greens. I suspect that this was the main reason why Labor lost by a larger margin than 2001 instead of the somewhat smaller margin I was expecting (and predicted – although I succumbed to a bit of cautious wishful thinking in the last day or so before the election).
In the medium term, however, Labor’s prospects aren’t as bad as they may seem. The Coalition gaining effective control of the Senate might actually be a blessing in disguise for the ALP, because it will tempt Howard to implement a range of more divisive, unpopular reforms including selling Telstra, sucking up to Murdoch and Packer and scrapping cross-media ownership rules, and implementing next generation IR reforms. Moreover, the lack of previous meaningful economic reforms, dangerous private debt levels and irresponsible spending promises will all have their adverse consequences. I suspect Howard (or perhaps Costello) will fairly soon be presented with the invidous choice of either breaking a swag of election promises or presiding over a recession we don’t have to have. It’s eerily similar to the situation Keating found himself in after the 1993 election and, like Labor under Keating, the Coalition may eventually find itself terminally “on the nose” whichever choice it makes.
Labor needs to avoid panic or public recrimination. But they should also avoid self-deluding assessments like believing they lost because of Howard’s “great interest rate lie”. I tend to think Latham should remain leader. He performed creditably, even impressively. Labor’s losses flowed from strategic and tactical miscalculations for which the whole leadership team was responsible. Despite being initially much less than impressed by the ALP’s choice of Latham as leader, I now think I was wrong. Latham remains a better choice as leader than any other available option.
But he must avoid jumping into bed with the Greens again, and concentrate on carving out a coherent, credible economic and industry policy stance over the next term instead of succumbing yet again to the delusion that a small target strategy with policies being released in a last-minute confused orgy during the election campaign is somehow a great masterpiece of political planning. Labor’s done that twice in a row now, and it’s failed dismally both times. It’s Time for a change, in more ways than one.
PS – I predicted a Coalition victory here, here and here. I succumbed to wishful thinking early on election morning, commenting that “the contest almost certainly remains neck and neck. Latham might just do it.” But I did so because Newspoll had the parties at 50/50 and Morgan at 51-49 for Labor. I assumed that ACNeilsen, which had the Coalition massively in front at 54-46, must be just plain wrong. In fact the Neilsen poll, along with Galaxy, both got the result close to spot-on (although Neilsen overstated the Coalition’s primary vote, and therefore the two-party preferred figure, by a couple of percentage points). Galaxy actually got remarkably close, showing a 2PP result of 52-48 (which is exactly right), a Coalition primary vote of 45% (actual 46.6) and Labor at 39% (actual 38.2).
And, as Bryan Palmer observes, Morgan has been drastically wrong at the last two elections in a row. Something is badly wrong, and serious political analysts should simply ignore Morgan until they prove that they’ve got their house in order. Morgan is a totally unreliable, discredited guide. If we’d simply discounted Morgan and relied solely on Newspoll and ACNeilsen (and Galaxy), it would have been abundantly clear that Howard was heading for a clear victory. Certainly Newspoll’s flagship election eve poll got the overall picture wrong at 50/50, but their marginal seats poll had shown the Coalition solidly leading in all 12 of the most marginal seats.