4
Jan
2015

How to Improve Political Leadership

The framing of economic policies naturally has to take  account of current economic and political conditions. But the significant reduction in Coalition polling, both federally and now at  state levels too, indicates that the current dissatisfaction with the Abbott government’s policy stance(s) requires a strategic rethink. While the polling  reflects to a considerable extent an inability to obtain Senate approval of reforms, such Senate problems have been overcome, or at least been much reduced, in the past. New initiatives should now be considered, including some related to past events.

Former Minister for Employment and Workplace Relations, Peter Reith, argues below that the Coalition has reached the point where it needs to take more risks with its policies. Reith has some experience in

alleviating  Senate opposition. By negotiating with the Democrats he secured important reforms in labour market regulatory arrangements when the Howard government was in office in the late 1990s. While it is now too late in the current electoral period to obtain any such changes, a decision to outline problems with existing arrangements and needed major changes could create a situation in which the horrific defects in Labor’s union armour would be pinpointed both politically and economically –but also fairly. The current strategy of waiting for a Productivity Commission review restricts the Coalition’s capacity in attacking obvious defects in current arrangements which occur almost every day. Some of these have already been identified in the interim report of the Heydon Royal Commission. Why not make use of that report?

Reith’s close involvement in developing the Coalition’s early 1990s FIGHTBACK reform proposals is also relevant. While their radical nature (including a 15% GST) did result in a swing against the Coalition in the 1993 election,  their comprehensiveness provided a framework for future liberal policies. A comprehensive explanatory document of the rationale of budget proposals, with necessary amendments, might now be used to expose  the defects in the opposition line taken in the Senate ie such a document would be a political one, not one written by the Treasury.

Importantly, such a document could provide a basis for attacking Labor’s attitude in the Senate. The current approach concentrates on negotiations with the independents but should be accompanied by such an attack.

The release from archives of the 1988-89 budget papers and the commentary on them provide an opportunity. As noted in the article by Economic Editor Uren, “in just the one year of 1988-89, the Hawke government achieved savings three times greater than those planned by the Abbott government over the next three years, as it sought to reduce Australia’s foreign borrowing.”

Uren also refers to the article by former Treasury secretary, John Stone. He quotes Stone’s  comment to him (apparently made at the archives release) that Labor’s performance from 1987 through to 1990 was “extraordinary”. “Compared with the shambles we have today in our fiscal affairs,” Stone said, “it is worth remembering that in these three years the Labor Party not only produced three budget surpluses, which you can do in all sorts of ways, but they also did it by actually cutting government spending.”  In fact, spending fell by 2.1 per cent of GDP in 1988-89 alone and by 4.1 per cent of GDP over a three-year period.

What form might an attack on Labor take? It could include:

  • A list of Labor’s proposals in 1988-89 that were supported, or substantially so, by the Coalition ie a demonstration of bipartisan ship then;
  • A list of  the Coalition’s current proposals which have been rejected by Labor.  I surmise it would show very little bipartisanship cf 1980s;
  • An analysis of budgetary comments by Shadow Treasurer Bowen and Shadow Finance Minister Burke (did anyone know he holds that position?). I surmise this would show that if Labor had its way  there would be little or no reduction in the deficit outlook. Of particular interest would be whether Burke has said anything of substance and a comparison made with the initiatives taken by Finance Minister Peter Walsh in the 1980s.

In short, such an “attack”  might centre on “we did this in the 1980s why haven’t you been bipartisan in the national interest now”.

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