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Tony Abbott's Coalition making same mistakes as Labor

Date

Peter Hartcher

<i>Illustration: Rocco Fazzari</i>

Illustration: Rocco Fazzari

Some of the native tribes of North America believed that their warriors took on the attributes of enemies they killed in battle. Perhaps they were on to something. How else to explain the fact that the Abbott government seems to be assuming one of the most unimpressive features of the Labor government it defeated?

Labor had a self-defeating habit. It would announce a big, new policy, but fail to take the country along with it. The Rudd and Gillard governments routinely failed to explain new policies. They neglected to persuade the people. Their opponents would fill the void, and their policies would fail.

The mining tax is a prime example. A perfectly reasonable policy, based on rational economic principles, that would have given Australia some lasting benefit from a passing boom. 

But it was doomed by political mismanagement. It came out of nowhere, met a firestorm of opposition, was rewritten in a political panic, and soon disappeared into ignominy. 

The tax survives for now, but it’s a joke. It raised a risible $600,000 in the three months to the end of June, according to Joe Hockey. It will probably end up being even less; the mining companies that pay the tax have yet to make deductions against this tax bill. As Hockey likes to say, only Labor could devise a tax that raises no revenue. 

In a democracy, it’s not enough to win an election every few years. A government needs to generate and regenerate the support it needs to carry its program into public acceptance and parliamentary assent.

The Coalition witnessed Labor’s chronic inability to carry an argument and laughed at it. Yet we now see some striking similarities in the Coalition government itself.

The Abbott government’s first budget is the prime example. After 10 weeks, most of the major initiatives proposed are moribund. The government has failed utterly to persuade the people to support its budget. 

The government declared that there was a ''budget emergency'' in the nation’s finances. Today there is a ''budget emergency'' in the government’s political management. While the Abbott Coalition was formidable in campaigning against Labor’s policies, it is proving quite inept in campaigning for its own. It could destroy support for its enemies but is failing to build its own.

When Hockey first delivered the budget, 61 per cent of the people polled in a Fairfax-Nielsen survey said that it was unfair. A month later, 63 per cent told the same pollsters they thought it unfair. 

In other words, the government made no headway in the time when public opinion is most malleable, when people are forming their views of new proposals. 

This has emboldened an unruly, populist Senate to strike a very hostile pose. The net effect? While Hockey’s budget proposed $37 billion worth of budget repair – pending cuts and tax hikes – over four years, $24.5 billion worth of that is facing defeat in the Senate. That is, two-thirds of the government’s proposed fiscal fix is in dire danger.

''The big picture is essentially unchanged from before the budget – it’s deficits as far as the eye can see,'' says budget analyst Chris Richardson of Deloitte Access Economics.

''Over the past decade, federal government spending has grown by 3 per cent a year on average in real terms. Both sides of politics say ‘you have to get back to surplus, and that means you have to restrain spending growth to 2 per cent a year’.

''Well, this budget only proposed bringing it down to 2.7 per cent growth, and on current indications'' of the budget’s prospects in the Senate, ''it will be closer to 3 per cent,'' Richardson says. ''So we finally get a plan on the table, it’s only for 2.7 per cent, and the political structures are still failing to deliver.”

Does it really matter? ''Australia does not have a budget crisis. We do have a budget problem. It’s like Einstein’s line about compound interest being the greatest force in the universe. Debt will just keep accumulating.''

The people most animated about this are members of the government itself. Frustration is rising. So far, it’s contained. Government MPs and senators are not yet going public. But privately, Coalition members are growing increasingly critical of Hockey.

''This is the one thing that can derail the government,'' a minister says. 

''We’ve repealed the carbon tax, we’ve stopped the boats, we have to address debt and deficit.''

''You can’t declare a budget emergency and then go on holiday in Fiji,'' says another Liberal, a crack at Hockey’s absence from Canberra when the Senate was recalled in early July. 

Hockey should have been knocking heads together, not knocking off, he chides. ''Announcing the budget is not the point; legislating the budget is the point.'' 

A minister volunteers this admonition: ''We all have jobs to do and the budget is Joe’s. Plan A hasn’t worked and we need to see Plan B.''

A smart minister would have plans C and D and even a plan E as well, the minister adds.

Hockey is making a new effort. This week he launched a crossbench tour of Australia, visiting the independent and minor-party senators in their home towns, a concession in itself, a Treasurer tending to their political egos to explain, flatter and cajole.

Defenders of Hockey, however, point the finger at other senior members of the government. 

The budget proposes some big reforms in the portfolios of other cabinet ministers. The $7 Medicare co-payment, for instance, in Peter Dutton’s portfolio of Health, and the deregulation of universities in Christopher Pyne’s area of responsibilities. Why have these ministers been so ineffectual? Hockey’s supporters demand.

Before the budget was announced, a Fairfax-Nielsen poll acted on media speculation to ask voters whether they supported a $6 Medicare co-payment. Remarkably , most respondents, 52 per cent, were in favour and 46 per cent against. But after the budget, sentiment reversed, with only 29 per cent in favour and 50 per cent against, according to an Essential Media poll. In other words, Labor won the argument. 

Deregulating university fees has never found favour in any polling, but there is poll evidence that public sentiment has hardened against this idea too over the weeks and months since it was announced. 

A senior figure in the government accuses Dutton and Pyne of being too timid. Another Liberal accuses the pair of being ''just about invisible'' in mounting a persuasive argument for their reforms. 

Members of the government are getting cranky with each other, but the problem is a collective one. Wherever individual fault might lie, it’s certainly true that the government as a whole has failed as a force for persuading, for implementing and for succeeding. 

The government did no real work to prepare public opinion for some of its dramatic reforms, failed to mount a persuasive public argument, and, as a result, is watching the slow demise of some of its prized projects.

When Chris Richardson euphemistically blames ''the political structures'' for failing to address Australia’s fecklessness, he means the political parties, and there is plenty of blame to go around. 

Labor has taken a spectacular populist turn. Not only is it opposing most of the government’s plans to cut spending, it’s even opposing $5.7 billion in spending cuts that it proposed when it was in power. This is an extraordinary episode in irresponsible oppositionism. 

The Greens are no better. They’ve invented spurious arguments to block the government plan to resume increasing fuel excise by the annual rate of inflation. That is, a supposedly environmental party obstructing a pro-environmental policy.

The Palmer United Party is a more entertaining vehicle for delivering the same product – irresponsible policy and crass populism.

So the government faces an unwieldy, irresponsible Senate. But that’s not unusual. It’s part of the job of government to manage the upper house to get its way. 

If Labor was chronically unable to make reforms, and now the Coalition is struggling too, does this tell us something bigger about Australia? Is the country’s politics just too fraught, too cheap, too divided?

Not according to two accomplished reformers, Bob Hawke and John Howard. This pair has said in years past that reform is eminently achievable on the condition that a reforming government takes the people with it. 

And in a joint appearance by the two former prime ministers at the National Press Club recently, Howard added this advice. To succeed, a government needed to demonstrate to the people that ''any reform not only serves the national interest, but has got to be fair.'' Added Hawke: ''And seen to be fair.''

Tony Abbott has made the point that few people argue about the economics of the budget. It sets course for a prudent, gradual return to a budget balance over the next five years. The arguments are all political, as Abbott has pointed out.

Right. So if the problem is political, so is the solution. The government needs to rethink, recast, regroup, and reinvigorate. Otherwise it will increasingly come to resemble the government it replaced.

Peter Hartcher is the political editor.

481 comments so far

  • "The government needs to rethink, recast, regroup, and reinvigorate"

    The government appears to be like a bunch of ideologue puppets, operated by more powerful groups and individuals. So no, highly unlikely that anything will change.

    Commenter
    DD
    Date and time
    August 02, 2014, 12:17AM
    • what is worse 1 so called broken promise or 100? when all someone does is come up with policies which blatantly benefit their puppet masters you say this is a communication problem? are you serious peter? selling us a bit short dont you think? when we have rusted on liberal voters coming here and apologising for voting liberal I think that speaks volumes.

      Commenter
      harry
      Location
      melbourne
      Date and time
      August 02, 2014, 6:46AM
    • "a bunch of ideologue puppets, operated by more powerful groups and individuals." Got it in one. Simple, short, accurate. And no secret who owns them and who's pulling the strings.

      Commenter
      Alpheus Williams
      Location
      Red Rock
      Date and time
      August 02, 2014, 6:48AM
    • Correct DD. Filled with hubris, they have revealed their true conservative agenda - and it is not nice.
      One example is their anti science, anti renewables blinkered ideological stance, which will cost tens of thousands and jobs and is a disaster for investment.
      Australians cannot afford more expensive education - we currently share the cost because we all benefit from an educated population. Those short-sighted increased fees will become inflationary for wages & will add to the cost of doing business. As one of the wealthiest nations on earth, we cannot allow our children to wallow in debt their whole lives to suit some twisted ideological bent.
      Their destruction of the NBN to suit their corporate masters is yet another sad tale of putting corporate interests before what is in the best interest of Australia's own citizens.
      There is so much wrong with this extemist government.
      They have no mandate (if they did they would have control of both houses & they never have).
      They need to go. Double dissolution now.

      Commenter
      Caroline
      Date and time
      August 02, 2014, 6:51AM
    • How do you sell lies, dishonesty and unfairness to people after they realized they have been conned?

      Commenter
      TA
      Date and time
      August 02, 2014, 7:18AM
    • Where was Peter Hartcher and the rest of the media when the Coalition was allowed to bang on about the mining tax spelling the end of the world?

      Commenter
      brieve
      Location
      brighton
      Date and time
      August 02, 2014, 7:20AM
    • It's definitely hard for a government to "win hearts" when it intends to render it own young people destitute for the crime of unemployment. Even if you are only unemployed or three or four months between graduation and finding your first job, imagine lasting that period of time without any money for food, accommodation or medicine.

      Commenter
      Ella
      Date and time
      August 02, 2014, 7:46AM
    • The problem is not just that the Abbott Government has not fully explained its policies or provided conflicting information about them in the budget aftermath. In relation to their health policies, the more I found out, the .worse it turned out to be. For example, that they had given zero consideration to those with chronic illnesses and no health concession card. The challenge for many people with chronic illnesses requiring frequent doctor visits, diagnostic tests and prescriptions, will be just to survive the duration of the Abbott government.

      Commenter
      Helen
      Date and time
      August 02, 2014, 8:01AM
    • I will vote for any party at the next election that plans to create a Federal ICAC.
      Political funding and donations are a cancer in our system, the force behind ideological policies pervading the current govt and a wedge of disconnect between folk on the street and political parties.
      It is human nature to respond to influence peddling when that in itself makes you personally wealthier, aids yours and your families careers and provides personal fame.
      The clever peddlers are masters at making you think you have the power while simultaneously getting their way, its why they are remunerated so highly.
      This is the rot that need removing from our political system and will solve much of the mallaise on which Peter has commented.

      Commenter
      Danger Ranger
      Date and time
      August 02, 2014, 8:38AM
    • Sure both sides failed to sell their policies, but it's important to be clear that most Labor policies like the mining tax were good policies whereas Abbott's policies are all bad. They all target the poor without any effort to remove all of the top end rorts. Labor probably are the worse sales people cos they had good product to sell.

      Re the mining tax, Ross Gittens wrote a couple of days ago that:
      “When Labor allowed BHP Billiton’s Marius Kloppers and his mates from Rio Tinto and Xstrata (now Glencore) to redesign the tax, they predictably opted to take their depreciation deductions upfront. Once they’re used up, however, receipts from the tax will be a lot healthier”

      More reason to fix this tax rather than remove it!

      Commenter
      QED
      Date and time
      August 02, 2014, 8:51AM

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