It’s funny. I think academia is too theoretical, and politics isn’t theoretical enough. In this post I’ll defend the second proposition on politics, and if I manage it, a subsequent post will defend the first. I’m also thinking particularly about the ALP. In a sense my proposition is commonplace – that they’re not too good at ‘the narrative’ as we’ve come to call it.
It’s also a commonplace that elections appear more as auctions than they did a generation ago. Yet in what’s a pretty much zero sum game, participating in an auction is a dangerous business. Of course you have to bid in the auction, you can’t go into it with people thinking you’re going to make them worse off. But how are the punters going to keep tabs on all those promises you make? Not only don’t they understand the transmission mechanisms and the difference between where a tax notionally falls (GST and PAYE are notionally paid by business) and who really ends up feeling the tax in their hip pocket (who does?). But even if they cared to spend lots of time adding up the parties’ various promises like Charles Darwin added up the pros and cons of getting married (a pro was that his wife would be better company than a dog which on all accounts she ended up being) how are they going to divine it through the spin and counterspin of the parties and the fog of the media’s infotainment coverage?
That’s where you’re much better off selling the vision itself, not just the benefits. Despite the great collapse of ideology in the last couple of generations, it’s not the case that the two parties don’t have recognisably different sympathies (however much they feel they’re actually able to indulge them). The ALP is more concerned with ‘fairness’ and those doing less well. The Libs would argue that their own philosophy actually delivers fairer and better results for all, including those not doing that well – especially in the long term. But they’re more inclined to emphasise the importance of incentives to encourage people to make money – and to discourage them from doing harm.
But a core part of the ‘progressive’ agenda that’s somehow gone missing here is the idea that the progressive agenda is more thoughtful, less tied to special interests and the custodian of enlightened thinking about things, that the conservatives are too stupid or two self interested to defend. ((I’m speaking in terms of political rhetoric, not saying conservatism is stupid, though in the US and to a lesser extent here, it seems to be going into a new stupid phase. ~ NG))
A uniting theme of progressive thinking should be the idea of the mixed economy and the interplay of public and private motives. In that vein, as someone pointed out to me recently, in setting up the various ‘my’ sites – myhospitals, myschools – mightn’t it have been a stronger message for the ALP Govt to call them ‘our hospitals’, ‘our schools’? And at the level of policy, plenty of ideas in the body of public policy thinking – I’m thinking, not surprisingly of economics – which provide guidance. The classic example is Keynesian management of the cycle. Following the advice of its bureaucrats, the ALP Govt managed one of the most successful fiscal stimuluses in the world from late 2008 on, but a lot of its defence of its actions accepted the basic non-Keynesian narrative – that it was doing it to save ‘jobs’ which left unchallenged the counterpoint that these jobs were charity jobs, that people with jobs were paying for the people without. But this wasn’t true. They were doing it just as much for profits as for jobs. Just as much for efficiency as for equity.
And of course they failed to stand and defend themselves against the ‘gotcha’ coverage of the school building program – which again reinforced the narrative.
I see this pattern repeated in numerous places – a higher level explanation of what’s going on goes begging – for lack of real conviction. The ALP’s defence of the NBN basically accepts the premise of its opponents – that it needs to be commercially viable to be successful. ((As has been pointed out to me, there is at least an ulterior motive to this manoeuvre which is the desire to do the funding ‘off budget’ so that the investment in the NBN does not act as a drag on the budget – though this brings to mind a further issue which is why we don’t distinguish more between capital and recurrent items in our budget accounting. ~NG)). But that’s nonsense. Do they know that economists have written about the merits of marginal cost pricing since the 20 and 30s and developed the theory of public goods in the 50s and beyond? The strange thing about all this is that, unlike some of the issues they took on in the 70s and 80s – things like reducing industry assistance – these ideas can be much more effectively transmitted into the populist playbook. The ALP could be out there taunting the Opposition saying that only the Opposition thinks that the internet should be regarded as a private rather than a public good (or managed deliberately to optimise its benefits as a public good) and that that means Australians will not only get worse broadband under the Coalition, they’ll get more expensive broadband under the Coalition.
Of course it’s sometimes possible to detect such ideas in the melange of arguments they use to defend their policy, but there’s no real identification with the issue except for its ability to deliver some goodies to the electorate in the huge mix of goodies on offer. I’d argue the same on the various agendas regulars here will have seen me bang on about.
- Fiscal policy governance – we need better institutions to optimise the fiscal stance. And like it did with National Competition Policy, the ALP could make a virtue of the necessity of its minority status – which is already seeing the introduction of the Parliamentary Budget Office – and take it further – God knows the ALP suffers for its determination to present itself as fiscally responsible against the psychological prejudices of the electorate that figures that the Libs must be better with money since they represent it!
- This leads directly to the issue of governments borrowing more to invest in public assets. The states could easily double investment in infrastructure (levying charges on it where appropriate) and if necessary accept a (temporary) downgrade from AAA to AA. That would give us around another $100 billion to invest in infrastructure. Will someone tell me that wouldn’t be popular? Oh yes, their opponents get to bang on about the credit downgrade (if there is one) but the government could point to the infrastructure going in and ask which bits would be stopped by an alternative government. Instead we stick to the script of debt minimisation.
- Regulation – the current basic philosophy of ‘regulation review’ has not changed since it was introduced by the Hawke Govt as ‘minimum effective regulation’ in 1986. Nothing wrong with keeping regulation to the minimum that’s effective. That’s an important agenda (which no-one’s managed to deliver on particularly well). But hey, regulation is the third arm of govt – along with monetary and fiscal policy. Isn’t it time we balanced a desire to reduce unnecessary regulation with a desire to regulate as well as possible where we do regulate? To focus on optimising regulatory benefits at least as much as minimising regulatory costs?
- Banking – as I’ve argued elsewhere the government’s package on banking competition could have built the institutions necessary (as it did with HECS) (pdf) to make banking more efficient, cheaper and fairer.