Monthly Archives: August 2018

Australian politics is not broken, but the Liberal Party might be

The Liberal Party’s extraordinary leadership turmoil, and the likelihood that yet another  Prime Minister is cut down before serving out their full term, has many wondering if the political system is broken.

It isn’t.

There is no doubt that the slavish attention now paid to opinion polls, which have assumed oracular status, has made party politics highly volatile, and the position of leaders more precarious.
But what is playing out in gory detail before the eyes of the country at the moment isn’t the breakdown of political machinery, but a fight for the soul of the Liberal Party.
Abbott, Dutton and co. hold the delusion that they are representative of a mythical ‘silent majority’ that ascribes to their vision of a white-bred country. In their world, Turnbull has too much in common with the Left and is leading the country to Gomorrah and the Coalition to oblivion.
There is no doubt that many people, probably the majority, are not particularly thrilled about the current state of affairs. No period is without its challenges, but the sense of uncertainty and apprehension about the future appears heightened at the moment.
Yet relatively few, I suspect, think that the solution is just to shut the eyes and pretend none of it is happening, which is essentially the policy prescription of Abbott and Dutton.
Which brings us to today’s tussle over where the Liberal Party sits, and where it is going.
For years the Coalition has been slowly abandoning the political centre, something the wiser heads in Labor have spied and are trying to exploit.
The politics of migration to one side (bipartisanship on the treatment of refugees has largely neutralised the issue), the Coalition has sought to wind back action on carbon emissions, undermine Medicare, derail public education reforms, narrow Australia’s engagement with the world, drag the feet on child care and pander to the interests of older voters over those of the young.
Turnbull, who was chosen by his colleagues to replace Abbott and stem this rightward drift, has proved himself an inept politician. By pandering to the maddies like Abbott and Christensen rather than staring them down, he undercut his own authority and emboldened them. The dynamic this set in train was always going to end up in tears.
A Liberal split?
The compulsory voting system means that the weight of the national vote is in the centre – only on rare occasions, and in particular electorates, do the extremes gain much traction. Howard understood this. So did Keating, hence his success in beating Hewson by painting him as an economic ideologue and a risk.
If Abbott, Dutton and co. seize the leadership today and try to drag the Coalition even more to the right, they will increase the strain on a party whose unity is already under severe pressure from trying to span such a wide political spectrum.
An outcome of this episode is that the Liberal Party could splinter. In the early 70s, the success of Whitlam-led Labor revealed a shift in the nation’s political centre over the previous decade or so that had been disguised by the dominance of Menzies and the Liberal Party. As the Coalition recalibrated its position, Don Chipp spied a gap in the political centre and formed the Democrats.
If Abbott and co prevail today, some current Coalition MPs may take a leaf out of the same playbook and quit. The Liberal Party could become a rump based in regional Queensland and parts of WA and NSW.
If Bishop ends up succeeding Turnbull, as I suspect is more likely, it would signal that the bulk of Liberal MPs understand that their political future lies in a contest for the centre.
Abbott, Dutton, Christensen and their fellow travellers would then face the stark choice of sucking it up, or finally having the gumption to leave the supportive cocoon of the Coalition and putting the extent of the their electoral appeal to a real test by forming their own party.
My guess is some might follow Bernardi and do the crazy-brave thing, but most are too timid (and smart) and will stay put, because in their heart of hearts they know that their political relevance is likely to be much reduced once they step outside the shelter of the Liberal Party.
If anything, this episode will show the strength of our political system and, in particular, the virtue of compulsory voting.
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Why we should be worried about what happens to Turnbull

By Adrian Rollins

Now that the Band-aid has been ripped off the Coalition’s torn leadership, what does this portend for the nation’s economy?

Among the many self-inflicted wounds of Malcolm Turnbull’s trouble-plagued prime ministership, his dogged pursuit of business tax cuts stands out.

Turnbull expended substantial political capital and effort on the measure, lambasting opponents like the Labor Party and badgering waverers like Pauline Hanson’s One Nation. Despite setback after setback, the Liberal leader did not waver from his support for the policy, which he said was essential to sustain the country’s economic competitiveness.

In the end, it was all for nought. Though tax cuts for businesses with a turnover of less than $50 million have been passed into law, a Bill to provide similar relief for larger firms has today been rejected by the Senate.

Turnbull’s signature economic reform of the past year is dead.

It caps a terrible record of under-achievement for a Prime Minister whose CV sparkled with private sector success as a lawyer, a banker and an investor.

After a string of career politicians leading the country, (Keating, Howard, Rudd, Gillard, Rudd (again), and Abbott), Turnbull was seen as a welcome break – holding out the promise of a practical and results-driven politician just keen to ‘get things done’.

Instead, it is Turnbull who got ‘done’. The rot set in in the earliest stages of his leadership when he caved to the demands of haters and extremists on the Right, rather than staring them down. Having just won the endorsement of his Liberal colleagues by a convincing majority, his political power was at its zenith and the likes of George Christensen, Corey Bernardi, Jim Molan and Craig Kelly could have been marginalised.

Instead, by pandering to their ever-more-strident demands, Turnbull fed the beast of dissent, and is now set to pay the ultimate price.

Having failed miserably to deliver the tax cuts he argues the country needs, and having failed to erase the fog of uncertainty shrouding the nation’s energy and climate change polices, Turnbull’s economic legacy is exceptional only in its mediocrity.

But if you think that’s bad, his potential replacement could well be even worse.

Peter Dutton, a man who rose without trace after being plucked from backbench obscurity by an increasingly embattled John Howard as a sort of electoral talisman, is not a deep thinker.

That by itself is not necessarily a deal-breaker when it comes to being PM, but its opposite should be.

Throughout his career, Dutton has shown himself to be a narrow and unimaginative politician. He has adhered like araldite to a constellation of received attitudes and prejudices that hark back to an Australia that has long since departed from most corners of the country.

Think this is harsh? Consider his response when asked on Sky TV, in the aftermath of his failed leadership bid, what he thinks of the Coalition’s prospects: “I believe strongly that we can win the election if we get the policies and the message right about lowering electricity prices, about … We need to invest record amounts into health and education, aged care and …”.

It’s a shopping list of platitudes, not a manifesto for leadership. Dutton might say he is merely reciting the priorities of the Government of which he remains a member.

But for someone who has long harboured ambitions to reach the top job, it seems like a very thin resume of ideas.

Aside from a determination to ignore the policy challenges of a rapidly changing climate, Dutton’s grab bag of priorities betrays sloppy economic and fiscal thinking.

First the fiscal. Just by virtue of holding its spending steady as a proportion of GDP, governments each year invest “record amounts” in areas like health, education and aged care.

Economic naivety could be much more serious and potentially damaging.

If, by “lowering electricity prices”, Dutton is simply using shorthand to refer to policies that might help contain the extent of price rises, that might not be so egregious. Governments already interfere in market pricing, such as by limiting annual residential rent increases. While this distorts the property market, the potential discouragement of investors is balanced against the financial certainty it provides to renters.

But if he is delving into the agrarian socialist playbook of his fellow-travellers in the National Party like Christensen and Barnaby Joyce to introduce price controls, that is much more concerning.

Because of the modest size of its economy, Australia relies heavily on foreign investment for development.

But every measure taken to prop up farmers and rural industries, to block offshore investors, and to control prices, comes with a cost.

In the aftermath of the GFC, Australia has been a popular destination for foreign investors. But as the US and other economies strengthen, that advantage is waning.

Markets hate uncertainty, so the latest bout of instability surrounding Australia’s highest political office is unhelpful.

Add to that the prospect of a change to a leader even more deeply beholden to vested interests and a Trumpian understanding of the economy and trade (ie. not much), and even the modest growth of recent times might seem like a golden time of prosperity and stability.

As Coalition MPs consider how they will vote in the next leadership ballot, let’s hope they consider what’s best for the country, rather than just what’s best for them.

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