Crunch time

Climate change is the biggest economic challenge that the global community faces.
K Rudd Parliament 24 June

Climate change is the biggest economic challenge the global community faces.
W Swan Parliament 25 June

I note that there will be a fall off of jobs in the old polluting industries. But, you know, aren't workers going to be better off? Isn't their health going to be better? Isn't their spirit going to be better?
B Brown 26 June 2008

The Gippsland by-election may have finally given some in the media something tangible from which to call an end to the Rudd honeymoon that continues to be denied them in the national polls. That’s their problem. In reality the main national implication of the result is to show that the federal government has yet to consolidate its themes that would have prevented it becoming the local issue campaign it largely was. Yet there was something about the 10% swing in the Labor-strongholds of the Latrobe valley that sharpens the edge about what’s coming up in Canberra.

In hindsight, the by-election will probably be seen as a product of a political period that is now passing. The events of the last week suggest the framework is starting to shift. While the media got into a tiswas about the Budget and the petrol excise fuss following it, the change in the petrol debate last week presaged the real Budget due to be handed down this week that will define this government.

The Liberals U-turn on climate change in the run up to the release of the Garnaut report this week could mark an end of a period in politics that goes back to before the election campaign. Since the November election was called, both parties have engaged in holding operations that largely relate to the problems of their traditional supporter base.

For the Liberals, theirs is a problem of a supporter base that is drifting off to a social agenda they don’t recognise. They are reminded of this every time they see the Member for Wentworth and recall what sort of campaign he ran that made him one of the few coalition MPs to improve their vote at the last election. This dilemma between the party’s traditional program and what their many of their core supporters actually believe lay behind the Abbott v Turnbull leadership contest. Their inability to resolve it brought Nelson to the top.

But that dilemma remains unresolved and while it keeps Nelson there, it undermines his leadership. This is unsustainable and, at a guess, it is starting to go back in the old leadership’s favour and if anyone succeeds Nelson it is likely to be someone of which Howard would approve rather than Turnbull. The reversal of Howard’s earlier unenthusiastic concession on climate change signals that. The Gippsland by-election has not reversed this situation, merely taken away a convenient excuse they could have used to dump Nelson.

While the Liberals are faced with a dilemma they can’t resolve that turns them into an uninteresting debating society, Labor on the other hand is a party in transformation. Rudd’s anti-politics technocrat agenda finally resolves where the party can go having lost its social base and historical role during the Hawke/Keating years. The Rudd-Gillard team may have posed themselves as union-friendly and mobilise the party for the election by opposing Workchoices, but the reality after the election should have surprised no-one. Except perhaps the ACTU, who after wasting $30m of its members’ dues on a campaign to buy influence with the Labor leadership before the election is now wasting more money trying to get the government leadership to change their minds after it. It was not just the unions. The party’s internal factions have also been dealt with, especially the most powerful, the NSW Right, as signalled by the fall of that glamour couple of the Central Coast.

Where Labor was going was not clear in the early days when it focussed on the inflation ‘crisis’ that seemed like politics as usual but was actually about undermining the legitimacy of the spending programs of both the former government and the ALP. That tactic largely ran its course by the Budget, when the media discovered a hole where a traditional program was supposed to be. The Budget marked the end of the media’s honeymoon with the new government. Media disillusionment was compounded when we had a small moment of truth about what the Rudd government was really about when he admitted there was little it could do about higher petrol prices, but before he had laid the political grounds for doing so.

Those political grounds are coming and it is climate change. The Liberals’ early U-turn has galvanised the government leadership and cohered it behind a program that will take the ALP and Australian politics to a different place.

The climate change agenda challenges the old preconceptions about left and right. It is not just because political thinkers of the avant-garde left like Rupert Murdoch have embraced it, or that independents like Tony Windsor in blue ribbon rural seats like New England can make it core to his election case. Most telling was the breakdown of questions asked by Essential Research, the new joiner to the polling organisations, which has been kindly made available by Pollbludger. When asking 1014 voters whether the Rudd government was doing enough on climate change, they got the following response:

Doing too much (Voting Labor 3%, Voting Coalition 7%, Total 4%)
Doing too little (Voting Labor 39%, Voting Coalition 67%, Total 56%)
Doing enough (Voting Labor 58%, Voting Coalition 26%, Total 40%)

There are two points to make on this. Firstly, upping the ante on climate change will be much easier than the media is currently portraying. Secondly, on this evidence coalition supporters appear to be much more keen on action than Labor voters. Even ignoring the views of traditional Labor voters in the coal industries of the Latrobe Valley, perhaps this should not wholly surprise. The right have always been more comfortable with the idea of natural limits to society. Part of the reason it has had a left-wing edge until now was that opposing the Europe-led climate change agenda was a major foreign policy driver for the neo-con’s project to recover US political leadership. That having failed, both the left and right wings of the US political class are now working out how to muscle in on the climate change agenda.

A few months ago this blogger had the opportunity to see a prominent catalyst for this change in the US political class, Al Gore, give his well-rehearsed climate change speech. It was interesting in that it was only partly about climate change. After breezily running through the science, he got to the main point of it, how he lost the US election, the fall from grace as VP, being converted to the dangers of global warming and then vindication as a Nobel Prize winner. It was a story of political revival and how mobilising against global warming can give a new sense of political purpose. Here in Australia, we are about to see if he is right.

Morris Iemma: Political maestro

Apologies to any NSW readers who injured themselves falling off the stool at this headline, but just indulge for a bit. There is a basic misconception about the way the political situation in NSW is being discussed, prompted by the latest Newspoll that shows the NSW government has fallen behind (and attempts by The Australian to stretch it to a nationwide trend for state Labor by making a big deal out of minor poll movements in other states).

Analysis of Iemma’s position suffers too much from seeing him as a victim of fate, rather than also, partly, a maker of it. It might be useful to separate that which is out of his control and that which is not.

The NSW Labor government has been in a state of growing paralysis that it has, until recently, been unable to tackle. The source of this paralysis is the weakening power of the union movement which has undermined the effectiveness of the last Labor government over which it has influence. The NSW government was one of the earliest and most successful versions of the Modern Labor Mark I model which brought unions and business together and which reached its apogee during the Hawke years.

As unions lose their influence, so Labor’s links with the unions become less useful to business. The normal big business links with Labor, which was so openly paraded during the Hawke/Keating years, became less systematic, lost their legitimacy and rapidly become seen as corruption. So we have coming to the surface such tawdry intrigues like the ones between property developers and the Wollongong City Council.

The other pressure point on the government from this paralysis is in the provision of public services, because let’s cut to the chase here. When people say these days that public services need to be improved what they mean is taking on the public service employees that provide them. In the past, the Labor way would have been using the relationship with union bureaucrats to push through ‘efficiencies’ (longer hours, lower pay). However, their declining social influence has made that less possible.

In Victoria, Labor had the luxury of opposition while it watched Kennett take on the public service, wringing its hands while it quietly accommodated itself to the new political reality. In NSW, Labor did not have the blessing of a state bank collapse and so was forced to have to deal with it themselves while in government. With unions still influential in the party but less so in society, the Labor government is stuck with a dead limb it has to cut off.

This is the essence of Iemma’s row about electricity privatisation. The scenario of Iemma as victim can never explain why it is that a Premier facing corruption, public dissatisfaction over services and Ministers falling out of Cabinet for the most sordid reasons, then wants to go and seemingly make things even worse by picking a fight with his parliamentary colleagues, the party membership and the unions all at once. But this issue is not really about whether electricity is better being provided by the government or the private sector, but the break that will mean on union influence if it goes through. It is why Iemma has gone out of his way to upset the unions and exclude them from the process (which was not always a feature of Labor-led privatisations in other states). For Iemma, privatisation is not just another of his problems, but by dealing with the union links, a way of solving them.

Will this work? There are a couple of things in his favour. Firstly Iemma has help from Canberra. Gillard’s intention to centralise the country’s unions under her federal anti-union regime has led to common purpose in dealing with one of Iemma’s major barriers to breaking with the unions, Della Bosca, through his unfortunate wife.

Secondly, of course, is the opposition. The Newspoll survey putting the coalition at 52/48 is hardly where a normal opposition should be given the state of the government. The ABC’s Antony Green has noted that given Labor’s low primary vote (32%), Newspoll seems to have overstated Labor’s 2PP based on the 2007 election. Although given that surely a lot of the support lost in recent months would have come from Labor supporters disaffected with Iemma’s breach of party policies, it might not necessarily translate through to the Liberals anyway.

However, the weakness of the opposition is not all good news for Labor. Iemma is essentially trying to move NSW Labor to the technocratic Modern Labor Mark II model in line with the other states. But unlike the other states and federally, it has been left so late that the decrepit state of the Liberals means this has to happen while in government. If the normal two-party system was still in operation Iemma would have lost the last election and all of this would be happening with the discretion of opposition.

Furthermore, the weakness of the NSW Labor leadership means it is happening without the normal political arguments that were used with moderate success by Labor leaders like Keating. This lack of ideological cover to what Iemma is doing is what makes the process look out of control and him look like a victim of fate. All of this is politically corrosive to both parties. It is signified by the rise of the Independents who are likely to be more the beneficiaries than the coalition. These are a new breed of independents who may pose as single issue candidates, but are really nothing more than anti-politics politicians signifying the erosion of the old two-party system. At least Iemma can take heart from the experiences of other states, which show that at the end of the day, these independents are generally quite comfortable working with the type of technocratic Labor governments that Iemma is trying to achieve.

Liberals get ready to lurch – Part 2

It's just one poll, if the next couple of polls show the same thing, then I think obviously I think it starts to get significant.

T Abbott 17 June 2008

It has been surprising how little attention was given to Abbott’s response to yet another poll showing the end-of-the-honeymoon-that-never-came. It is significant. Firstly because although it has been said that it puts Nelson under notice in the future, it actually damages him right now. It undermines one key thing that leaders need to be seen to have – control over their destiny.

Secondly because it marks the re-emergence of that part of the Liberal party that does have control over Nelson’s destiny, the old leadership, whose last minute withdrawal of their candidate, a certain Tony Abbott, ensured Nelson’s win last November.

Abbott’s withdrawal was a necessity to prevent something worse for them than a Nelson leadership - a Turnbull one. Unlike how it is often discussed in the media, growing party support for Turnbull is not the main threat to Nelson, the reverse is. The less Turnbull looks like a feasible threat, the less the old leadership have a need for Nelson to fill the gap and the more likely they can move to retake control.

Abbott’s shot across Nelson’s bow is one sign that they are starting to do so. A clearer sign is this week’s highly significant tactical U-turn on climate change. Turnbull’s star already looked to be on the wane following the Budget and the climate change U-turn is now seriously undermining him. It has placed Turnbull in an impossible situation. He must either break with the party line or keep up with it. However, in changing tack he undermines his credibility as an alternative to the old leadership and its failed agenda that he had so carefully built up in the dying months of the Howard government.

Turnbull is a fascinating lesson in the art of politics if only to see how it is not done. On paper, he seems the ideal leader for the Liberals at this stage and the media naturally assume he will be. However, he is a political babe in the woods. A classic example is the focus group that he is reported to have organised, which has given the government such fun this week and finally given Swan his confidence in the House after months of agony trying to pretend he has an economic policy. Running a focus group to find out what the public thinks of him neatly sums up Turnbull’s problem. He seriously thinks that it is his electoral popularity that is the main barrier to winning the party leadership. It is actually his party colleagues and for them, electoral popularity is not the first thing on their minds.

For the factor that is forcing a move on Nelson is less his poor polling in the electorate but a much more serious problem, which is euphemistically called ‘damage to the party’s brand’ i.e. the erosion of the party’s core support base.

The irony of the Nelson leadership is that the tactic that is causing the government most problems is actually the one that causes the most problems for his own side as well. Nelson’s eager adoption of the New Sensitivity may lead to him being mocked but it has provided a difficult target for the government to get its teeth into over the last six months.

Everyone talks about Nelson having failed to land a glove on the government, but neither has the government really laid one on Nelson – until now. Nelson’s problem has tended to be that he takes his empathy too far, hence the mockery, but that is because he has pressure behind him to go in harder than he should. However, the old leadership’s impatience at what effect going along with Rudd’s position on the apology, climate change and over-turning all those other increasingly meaningless symbols of the Howard era will have on their core support base, has now forced them to act and start to undo what they see as the damage of the last six months.

It is pretty easy to make the electoral argument against this U-turn back to the old Howard agenda – it lost the coalition the election just six months ago. You only have to listen to Question Time this week to realise how the government has been re-energised by the U-turn on climate change. The opposition’s questions on petrol and climate change are so popular with the government that they are being set up from their own side as well. It has allowed the government to revive its focus on the long term agenda that helped it win power.

In fact so dramatic was the turnaround in the mood in Parliament this week (something not picked up much in the press) that it must be giving some Liberals food for thought about the new tack they have taken. But ultimately, such concerns are eventually going to have to be put aside. At the end of the day, they might have no choice.

Liberals get ready to lurch

If the Liberal party is a car suspended momentarily up a cliff, there are signs that it is starting to move – and the direction is not up. The first sign is the serious mis-step they have just made on petrol prices.

To review the petrol price issue: for weeks the Liberals (and the media) have thought that they had the government under pressure over petrol prices after Rudd commented that there was little the government could do about it. Lowering expectations about what government is capable of is core to Rudd's agenda. However, the mistake Rudd made was to boldly state it before he had fully laid the political conditions for doing so. Not a great mistake, as he was only saying out loud what the electorate already generally thinks. But to the media and the Liberals, still catching up with this new reality, it seemed like one.

That is not to say that Nelson did not have something to play with. Putting petrol excise into the spotlight was not a bad move. After all, the surplus was supposed to be there for tough times and wouldn't “the third great oil shock”, as Rudd likes to call it, be one of them? The problem was that this tactic could only be pushed a small distance because the reality is that there is relatively little the government can do about such a global problem and the public knows it. The Liberals could never have linked cutting excise to a broader political position.

Unfortunately internal considerations in the party forced Nelson to go in harder. Dealing with the new government requires a deft touch which is near impossible when you have the old leadership in the form of Bishop and Hockey at each elbow. Making it concrete by putting a specific 5 cent cut was daft. Attacking Labor's anodyne scheme to allow customers to compare prices was even more dumb.

The Liberals' mistake was to confuse a government that had made a small stumble in the process of consolidating itself for a government that had thrown in the towel in just a few months. Since making the statement, Rudd has accelerated the political arguments why there is little the government can do. He has gone out of his way to emphasise the international dimension of the oil issue; talking about Asian initiatives and applying a blow torch to OPEC. It didn't matter that no blow torch ever materialised in Martin Ferguson's hands while in Jeddah, it was enough that all the attention was focussed on an international summit where others were trying to do the same.

However, the most important political weapon the government has is the climate change agenda. Unlike practically every other blogger on the internet it seems, this one has no expertise in climatology. But the political implications of the agenda are clear. Already we see how state governments turn a problem of poor water infrastructure to a problem of global warming, it is a shame they can't blame the other underfunded infrastructure such as rail and roads on climate change as well. At the federal level, climate change is not only a global issue but all about setting down constraints that governments must work under, making it an ideal issue for this one. It turns the whole petrol debate around from how can we afford using it to whether we should be at all.

The Liberals, however, have a tendency to see it upside down. For them, climate change won't depoliticise rising petrol prices, it will aggravate it, which is why they are now raising the threat of further petrol hikes when it is included in carbon emission trading. An example of the thinking came from Andrew Bolt on Insiders when he said that support for doing something about climate change will melt away if it means higher petrol prices. However, Megalogenis was right in replying that focus groups are less concerned on prices than the lack of long term policy from government. What that means is that the climate change agenda has already been accepted, the electorate just wants government policy to come into line.

In fact the Liberals' 'pragmatism' on climate change is exactly what they tried last year and it failed. Their reality actually relies on a fantasy about how the international political order is shaping up and how social issues both here and around the world are being viewed.

This u-turn on climate change shows that any lessons the Liberals have learnt about the new political order are being thrown away. It shifts the petrol debate firmly onto ground where Rudd can feel comfortable again. It also gives the media an issue through which they can finally start to understand this new government, summed up by an excruciating interview on The 7.30 Report with the Liberals' poor climate change spokesman, forced to reverse months of trying to sell the coalition's great back-flip on global warming from being a sceptic to the keenest on the block. A return to the failed policies of the past indicate the re-emergence of the failed leadership of the past. It suggests the second mistake the Liberals are about to make – who they will choose to replace Nelson.

A crime without criminals

To mark the first anniversary of the NT intervention in Parliament, Rudd set out its achievements for the indigenous children of the Northern Territory;

Over 11,000 child health checks have identified kids who require surgery. This is a very important finding. Follow-up treatment, including surgery, is underway. Audiology services have been provided to 669 children, non-surgical dental services to 350 children, 46 children have undergone ear, nose and throat surgery and 40 kids have undergone dental surgery. In addition to that, 200 additional teachers are being recruited over the next five years to educate 2,000 young people previously not enrolled, and that again is an important measure, though that is very much a measure in progress.

Isn't there something missing?

Over the last year there has been a subtle, and rather unpleasant, re-writing of what the intervention is about. The easiest way to grasp it is to look at the shift over one of the issues that divided the response to Howard’s move last year; the role of the military. For those who opposed the intervention, like the authors of the Wild report, “All Children are Sacred”, they thought it was an over-the-top response to their findings. From the other side of the debate, Brough just shrugged when asked about it the other day, and said it was probably because of his military background that he called them in.

Let’s cut the crap on both sides and remind ourselves exactly why the army was called in a year ago. The Wild Report had just made the gravest allegation about the NT indigenous communities; that they were at best negligent, and at worst implicated, in the systematic sexual abuse of children. The extent and severity of those allegations went beyond just a police operation but required a law and order action on whole communities. It was the criminal nature of the claims that made it an ‘emergency’ as opposed to the ritual reports of the squalid health conditions of indigenous people that routinely get ignored.

The severity of that claim was why Howard immediately called for compulsory medical checks to find out who was at risk and to catch the perpetrators. This was made necessary because, as the report admitted, it had not gathered the evidential proof of widespread sexual abuse, just collated testimonies. Howard's insistence on it being compulsory reinforced the report’s view that the parents could even be involved.

Yet quite quickly the government backed away from this insistence, for two reasons. The first was that the hue and cry over compulsory tests showed that it hadn’t the political authority to impose action on the parents. This was not least because it hadn’t worked out the right response to the last time Australian governments took action using the excuse of protecting indigenous children from their parents.

Secondly, it was because he didn’t need to. One of the sickening aspects of the response to the Wild Report was how readily the most horrific claims that could possibly be made about indigenous parents and communities were so readily accepted across the political spectrum without demanding proof, not least from those on the left who pose as their supporters.

It was the lack of any insistence on proof that let Howard off the hook, despite starting something that he did not have the political capacity to follow through. Instead both sides assumed the allegations were true but just differed on the way to deal with it. Howard wanted the land rights system swept away while the left wanted the old system kept in place, without understanding that by accepting the allegations they undermined the credibility of a system that had allowed it to happen. Pat Anderson, one of the report’s authors, summed up the confusion on Lateline, waffling on about ‘empowering’ the same communities she had just claimed were guilty of one of the most basic crimes, abusing its children

What both sides agreed on was that the behaviour of indigenous parents was the problem. For the right, it was a matter of personal responsibility. For the left, it was a problem of lack of funding for housing and education. The fact that they thought overcrowding would excuse that sort of behaviour clearly showed the different standards they applied to indigenous communities than would be acceptable elsewhere in Australia.

This is now an appalling state of affairs. In any normal circumstances if a couple of parents had been accused of something like this, everyone would insist that proof was found to either take action to deal with the parents or to clear their name of such a grave charge. Indigenous communities have had no such courtesy. As Virginia Trioli reminded Brough on Lateline, after a year, the intervention has resulted in no increase in the number of referrals to child protection authorities and still no charges having been laid.

As Rudd showed by the fact he didn’t need to even address this failure when talking about its achievements shows how the terms of the intervention have changed. It has become almost like a health and education funding program. However, the unproven charge still hangs over the communities like a poisonous cloud and it remains an essential, if now implicit, part of the intervention. For if we haven’t had the evidence, or the arrests, or the trial, we have still had the sentence. Parental behaviour has had to be constrained and unsurprisingly, given the assumptions right across the political spectrum, the basis of it is racial. This was why the anti-discrimination laws had to be overturned to place restrictions on how indigenous parents spend their money.

Howard reached a limit on how he could far he could take the intervention because he was still restricted by the old framework of indigenous politics. It was one of the reasons for the broader re-think in the last months of his government. However, to break with the failed indigenous policies of the past it was necessary to break with the political traditions of the past. It needed the robust anti-politics campaigner, Rudd, someone not associated with the political traditions of either side, to do what past Labor and Liberal governments could not; excoriate the political class in his speech of 13 February.

The speech is usually referred to as an apology but bear in mind it went hand in hand with the grossest characterisation of the indigenous communities it was supposed to be apologising to, something Nelson made the mistake of reminding everyone on the day. This unproven charge lays the basis for the political bipartisanship today. If the political class is going to beat itself up it seems to need to take the reputation of the indigenous communities down with them. The last year has shown indigenous affairs remains intimately linked with the fate of the Australian political class – to the continuing misfortune of the indigenous people of this country.

Left out to dry

Wilson Tuckey thinks that Rudd's walk out of the Chamber ahead of the vote on Belinda Neal represented a lack of confidence in her. Well, duh! The entire way the government leadership has dealt with this indicates that they are quite willing to see her sacrificed. It has been forgotten that much of her troubles were driven less by a media witch-hunt than the way Gillard kept pushing the issue and getting Rudd to change his previous stance of playing it down while in Japan.

It may be just a coincidence that by keeping the issue alive it also put pressure on her faction boss husband with whom Gillard was in confrontation over her IR reforms, but it seems unlikely. Gillard is not the sort of politician to waste her time on what is otherwise a trivial issue. Her entire conduct shows her key role in the party, undermining the influence of the unions and the factions in the ALP.

The Liberals tactics in this are almost unfathomable. There is not a chance that going after Neal will benefit them electorally. In fact there is a danger that it could backfire as Albanese hinted yesterday given Sophie Mirabella's past remarks about Gillard (the anti- politics implications of this new standard of conduct is something Rudd will be much more comfortable with). It is likely to be more a result of Nelson responding to pressure behind him to go in hard on an issue, any issue, even if he has to get rather screechy in doing it.

Focussing on Neal could also be displacement activity given the Liberals have little else to talk about as shown by their inability to make any political point out of their obstruction of the Budget in the Senate. Fortunately for the coalition they have only a week left of control of the Upper House – a terrible thing to have happened to a party with no agenda to put through it.

Another honeymoon ends – an update

The Australian thinks Nelson has blown his fuel ‘edge’ but that’s only because they thought he had one in the first place. The fall in Nelson’s preferred PM status in this Newspoll is no more significant than the rise reported in the last one. More likely the increased publicity during the petrol hoo-hah meant that the public, understandably, were more willing to put a tick against someone they have seen on the telly. With Nelson back out of the limelight, we have all forgotten who he is and back down he goes.

Of course the real problem lies with The Australian and the rest of the media that simply cannot grasp the realignment that is underway in Australian politics and why a government that seems to be careering from crisis to crisis, according to them, actually saw its polling rise to an eye-watering 59%/41%.

However, having failed to admit their mistakes over a year of getting it wrong, the media is unlikely to do so now and this is probably bad news for Nelson. The only explanation will be that Nelson had a gift handed to him on a plate and he stuffed it up. In reality, the media forgets that while it may find that 80% of Australians want the government to bring petrol prices down (who doesn’t?) only 20% think that it can, while almost half think it is beyond the power of any Australian government no matter what their hue. This is likely to be even higher after a week of Rudd globe-trotting to make petrol an international issue.

For the Liberals, taking their cue from the media, as they have been doing for a while now, they too will think the government is more vulnerable than it is and that Nelson simply didn’t go in hard enough. You can hear it the more you can hear Hockey’s braying in the background at Question Time. At a guess, it will be the old leadership (Hockey/Abbott/Bishop not Turnbull) who will make the lunge. Oh dear.

The rats’ problem with Rudd

As the media continues to portray the Rudd government as the most popular ever to stumble from crisis to crisis, it is clear that something has happened to the media’s relationship with the government. Since the Budget, its honeymoon with the government is clearly over, even if the electorate’s isn’t.

One of the fascinating sub-themes of the political changes over the last year has been the media’s relationship to it. This has tended to be too narrowly understood by the blogosphere that poses as its alternative. For example, the tortured reading of the latest Newspoll to suggest that it spelt a meaningful drop in government support, was seen merely as just pro-Liberal bias from right wing hacks.

This won’t do. The view that the petrol price kerfuffle was a setback for the government was widely held across the media even by more balanced journalist such as Grattan (in fact it was even possible to discern some nerves from the Labor supporting blogosphere over its impact). Besides, even the most loyal coalition supporters in the press would not want to make fools of themselves by getting it so wrong. Clearly there is something more going on.

For a start, it is pretty evident that the press does not understand what Rudd is about. This can be looked at by reviewing each of three main planks of Rudd’s agenda; sidelining the political process, acknowledging the impotence of government and opening up to the international stage, all of which are causing the media problems.

1) A strange naivety
If fifteen years ago, a major left wing faction boss opposing Keating’s union reforms had been hauled over the coals by the Labor leadership for being rude in a night club, it would have been pretty widely viewed as not just about social etiquette, but politics. Certainly Rudd’s slap down of union boss Dean Mighell last year was viewed as such. Yet a pretty straight forward stitching up of a major faction boss by the two main power bases he is opposing, in Canberra and Macquarie St, is seen as a trivial distraction.

Even ignoring whether the toppling of a major faction boss is trivial (contrary to how the media portays it, his future is not dependent on the police enquiry. Now that Iemma has shown he can stand him down, Della Bosca’s influence is over), the problem seems to be that the media cannot grasp the politics that lies behind it.

It probably doesn’t help that this is not being posed in the usual right v left way. For want of labels, the battle is really between right v technocrat, as the Labor leadership sets about re-making the ALP by cutting its links with the union bureaucracy in the last state where it still has influence, through attacking what is pretty well the party’s last faction. It is the technocrat agenda, made up of politicians from the right (Rudd, Iemma) and the left (Gillard, Tanner) that the media appears blind to.

Part of the media’s problem seems to be that the technocrats don’t really have a message other than an anti-politics one. This is what is making Iemma look weak and indecisive. He can’t really say he wants to get rid of Della Bosca because he is in the way of cutting Labor’s last link with its now irrelevant social base. Rather Iemma has to move carefully, talking about mates and loyalty, and the wrong types of apologies, none of which makes much sense in themselves, but gets him where he wants to be. Anyone who thinks Iemma is weak is ignorant of Della Bosca’s internal power that has now been cut off at the knees.

Given the sensitivities of this for the Labor leadership, the media hoo-hah has been a useful excuse for taking action. Being the self-absorbed institution its is, the media thinks it is they who toppled Della Bosca, rather than Iemma and Gillard using the media for getting them the result they wanted all along.

This blindness to the technocrat agenda is really blindness to the collapse of the political process, something that was a feature of the last government when the media continued to see the implosion of the Liberals as a Costello challenge. Now that this collapse is much more a way of operating (e.g. like the ‘inflation crisis’) the media are struggling to do anything but take the government’s announcements at face value (and so making life easier for them).

2) Sticklers for convention
With the collapse of the political process, a lot of the rituals of Australian politics have lost their meaning. The media’s failure to keep up has meant they often getting caught up in what seems like business-as-usual but finding the end result was not as expected. A classic example is the Budget, a Parliamentary ritual that last year the coalition ticked all the right boxes for – to no effect - and this year was supposed to reveal the real Rudd agenda, but never came. Both times marked turning points in the media’s attitude to the government of the day. Last year, the failure of Costello’s Budget was when the media finally started to seriously countenance Howard’s defeat. This year it marked the start of the media’s disillusionment with the Rudd government.

Another variation of this is analysis-by-history, i.e. because it happened before it will happen again. The latest variation is that of course Rudd will last three terms, without bothering to explain why because that’s just what governments do (except of course when they don’t).

3) International politics is bunk
Obviously politics here is influenced by international factors as much as any other country’s, its just that in Australia it has traditionally not been polite to mention it. Rudd has changed all this. While admitting there is less he can do domestically, Rudd has been keen to be seen as much more pro-active on the international stage.

To the media, Rudd’s foreign policy pronouncements have been ill-prepared ‘thought bubbles’ that he cannot hope to follow through. But Rudd is all about process than the end result and what he is doing here is shifting the debate firmly on to an area where he can politically operate and where it is harder for the opposition (both in the government and outside of it) to pose an alternative.

An example is Rudd’s announcement that he will try and get OPEC to increase production and get Asian countries to cut petrol subsidies. Internationally these may not make much sense, but what it does is make the petrol price issue into an international one and re-emphasise that the government’s role here is limited, so defusing the thrust of the Liberals’ attack. The media here have confused a natural law that all politics is local with what had been the political class’s best attempts to try and make it so. To them Rudd is defying gravity seemingly putting international issues as more important than local ones. The trouble is, they can’t actually pinpoint what that local politics is any more.

Blind to a stitch-up

What on earth is wrong with the political journalists in this country? Here we have a naked political power play going on in front of our eyes and they miss it. Almost the entire discussion around Belinda Neal has been irrelevant because it misses the central point. Rudd-Gillard’s humiliation of her by sending her to therapy for anger management was not done for her benefit or because her behaviour at the Iguana club was a major embarrassment for the Rudd government. It was done because of who her husband is.

It seems the only connection being made between Neal and her husband by the press is that he was also at the Iguana club and also accused of bad behaviour. But that type of boorish carrying-on is what you would expect from a power couple used to calling the shots in the NSW Right political scene and it is that power that is under attack. Della Bosca is routinely just described as the Education Minister, but he also happens to hold another portfolio, Industrial Relations, and in case the press has not noticed, IR and the unions is a rather touchy issue at the moment in NSW. This is not only because of Iemma’s privatisation plans but also Gillard’s push to overturn NSW’s lone opposition to centralising IR, an opposition which Della Bosca is leading. Iemma’s push to make a break with the unions and join his other state counterparts means that he has common purpose with Canberra’s wish to bring the NSW unions under their anti-union regime. The latest example of the Della Boscas throwing their weight around was an opportunity too good to pass to deal with their common enemy. Canberra played its part with the easy target, the junior MP wife, Iemma has finally sorted out the tougher bit.

To grasp how naïve the Canberra Press Gallery is you only have to look at one of its best and most experienced, Michelle Grattan in The Age. Unable to see the link between Iemma’s push on electricity and Canberra’s agenda, she makes this blooper a few hours before Iemma forces Della Bosca to stand down:

Iemma has been left on the back foot. No wonder state Opposition Leader Barry O'Farrell was yesterday praising Rudd's move. But the Premier's hands are tied politically. With his party split over plans for electricity privatisation, he can't afford to lose Della Bosca from his front bench.

Having now removed one of the main barriers to introducing Canberra’s anti-union agenda, Iemma’s position is of course greatly enhanced, rather than weakened, against his union opponents in his own government. Grattan is hardly alone in a media (and blogosphere) discussion that has tended to get waylaid by the distraction helpfully thrown in by that fellow chum of the Della Boscas on the NSW Right, Julia Irwin, that Rudd’s action was sexist. The only real exception in the press, it has to be said, was The Australian whose editorial policy and chief political journalist may be all over the place, but at least has had the most insightful reports of the real agenda going on in NSW, flagged early on by a fascinating piece from Stephen Loosley last year and more recently by a perceptive little piece this week.

End game

Having sent the wife off to therapy for anger management, it looks like the Rudd-Gillard team is about to deal with the husband. The Australian reports that the Federal Labor leadership is set to get its way and the Iemma government will overturn Della Bosca’s opposition to centralising IR to Canberra and abolish his department. NSW was the only state to oppose Gillard’s IR plan because it was the last Labor government to make its break with the unions, a process that is now finally well underway. It shows that in the final stages of the ALP’s break with the unions, it is the right faction that is the really big loser.

By centralising industrial relations to Canberra it will be bringing the nation’s unions under a regime helped set up by the left that happens to be the most anti-union of any in Labor’s history. This politically dextrous act was done through the neat trick of opposing Howard’s sham anti-union initiative, Workchoices. Watching Gillard on Lateline a few weeks ago was to be reminded how useful a political tool the anti-Workchoices campaign was, but how it is now starting to run its course.

The importance of Gillard’s role in the government is constantly under-rated as shown by the persistent rumours that she is egging to be allowed a go at Treasurer. Without second-guessing her personal ambitions, it would be surprising if she did, since her current portfolio is much more important. Gillard is the stake driven through the undead body of the Labor party to keep it pinned down. She does this by holding the highly conflicting portfolios of industrial relations along with productivity and education. Holding this combination of portfolios is something never been done before, for a very good reason. Linking productivity and education with IR would have been unthinkable for a Labor Minister in the past because they go to the heart of the argument against the union movement.

Linking wages to productivity seems fair enough except for one basic problem, it assumes that how hard an employee works is the only factor determining profitability. It is not, of course, we daily see profitability impacted by a plethora of other factors not least a natural part of the maturing of the economic cycle itself. When that happens, the inevitable question comes, who pays? When wages are linked to productivity, it inevitably means the employee. It was why unions had traditionally been opposed to it and why when they agreed to that link under Hawke-Keating, it spelt their doom as their members took the strain in the wage-packet.

Gillard’s portfolio not only makes that link explicit but takes it further through her portfolio of education. Once it is accepted that the problem is employee productivity then it becomes fairly easy to make it a personal responsibility of the employee to improve. This is the thrust behind Labor’s skills argument against the previous government. It may have provided the semblance of an economic critique against the coalition, but it also implicitly laid the blame on the individual employee as well. It makes it a question on the education level of the employee and willingness to be re-trained to adopt new skills rather than the more fundamental question of Australian business’s inclination and resources to take advantage of them (which is why we see the brain drain to countries like the US where they do).

Given changing business’s investment levels is beyond the remit of most individuals, the education argument undoubtedly has some appeal, especially in the ALP, but ultimately it is more a political tool than a fundamental economic one. Brian Toohey in the AFR has been running a noble campaign highlighting the underfunding of the government’s education ‘revolution’ especially in the area where surely productivity skills would be most likely developed, the tertiary level.

Emphasising education may deal with political problems but it does not really create a new argument for going forward. The Lateline interview showed this and was interesting because it was one of Gillard’s few uncertain performances. It was helped by Tony Jones being on good form (not always the case) and persisting with three good questions. One was on Brian Toohey’s claim of education under-funding and another on the government’s claim to fight inflation.

However, the central one, which she could not answer, was whether wages should be expected to keep pace with inflation. She noted that the unions have agreed to have them linked to productivity but, of course, that didn’t answer the question. She tried rolling out the at-least-we-don’t-have-Workchoices line but that barely works now much beyond the most loyal Labor hacks.

Gillard’s problem with this question goes to the central difficulty Labor has now it has (almost) cut off the last remnant of its social base. Unlike the last Labor government, there are no relations with a union movement to make the argument with its members why wages should lag inflation. Even a Howard Minister would have had less of a problem with that question because they could have rattled on about irresponsible unions causing inflation, as though they still existed and there was a business community wanting them dealt with.

This government has an anti-union agenda more as a way of accommodating to the erosion of the unions themselves than because anybody really won the argument against employees improving living standards. Instead Gillard has to show sensitivity, which makes it hard to then argue employees should bear the pain of inflation. Gillard’s role is critical to this government but she has immersed herself deeply into a government without a social base on which to build a program, summed up at the Sydney Institute last night by Craig Emerson's 'market democrat' thingy (aspirational nationalism anyone?). Maybe the time will come when she might feel like a holiday in Treasury after all.

Flaws in the machine

Writing about the potential weaknesses of the Rudd government is by no means to join in the wailing media pack who thinks they are already fully evident (to all except the electorate). They are not. The government is only in the process of consolidating power. However, as the main points of Rudd’s agenda start to take shape, it is fairly easy to see some potential problems.

Australian politics is undergoing a major realignment. Its roots lie back in the late 1980s and early 1990s when the union movement began to lose its political influence and undermine the basis of the political system Australia has had for much of the last century. Its impact on the old political order was evident in Keating’s last term and Howard’s first, but suspended by the War on Terror. A reason why this blog was started was on the belief that the fading of the War on Terror would see that realignment rapidly resume.

Rudd’s agenda in a nutshell is to accommodate Australian political institutions to that realignment and the declining role of the major political parties. He has done it in three ways, discrediting the old political process, lowering expectations about what government can achieve and bringing global politics more directly into the Australian domestic scene.

However, in a way, that realignment is more like a political crisis where the major parties have lost their role but with nothing yet to replace them. The Liberals may be the most tangible sign of that crisis, but its epicentre is the ALP. Rudd’s government has accommodated to that crisis but has not yet resolved it and replaced it with something else. This is the source of the government’s weakness of which we have already had small indications.

The most serious weakness of the new government is its lack of social base. By social base it does not mean electoral support or even core supporters. Rather it is that section of society that clearly sees its interest reflected in the political party and ultimately guides its policy.

For the Liberals the clearest sign of the problem with their social base was Workchoices. Not because of how it upset the ‘Howard Battlers’, that mythical working class support base that conservatives periodically like to flatter themselves they can appeal to. But because business didn’t need it, given the weak state of the unions. The fact that after a decade of flogging AWAs they were still a minor part of work contracts showed that business no longer had any need for Howard’s faux Thatcherite agenda. When business doesn’t need anti-union legislation, it doesn’t need the Liberal party.

For the ALP, its social base is, of course, the unions, or rather, the union bureaucrats. It was the diverging interests between the union bureaucrats and their members in the Hawke-Keating program that triggered the decline of the unions. The loosening grip of the unions over the party they founded is reflected in the leadership's greater flexibility with the platform, which was evident in the policy-on-the-run of both the 2004 and 2007 campaigns.

The lack of this social base, and its policy priorities, is what gives the government a slightly hollow feeling and gives the Liberals confidence to accuse the government of ‘spin’. Not because it is especially good at media management (it has not been sparkling so far) but because it appears driven by nothing else. We had one small flash of the problems this lack of direction can cause with the couple of days in March when the government was paralysed over a small issue like carers’ bonuses. The lack of a core base in society to rely on when times get tough is also evident in the government’s caution in handling interest groups and underpins the New Sensitivity. It also means that Ministers can be in danger of being off-message, requiring greater centralised control over what they say.

This leads to the second potential problem area for the government, internal discipline. This is probably the least worrying, but likely to be most easily picked up by the press. The translation of the decline of a base in society is the decline of factions inside the party, which was a key platform in the Rudd-Gillard pitch for power. The declining power of the faction bosses (shown most amusingly by Rudd’s requirement that the MP wife of a right-wing faction boss seek therapy for being rude) may have removed barriers to leadership control but has also removed a means of disciplining members. It offers the potential not for major rows, but for fragmentation. Although going by the recent example with Ferguson, the problem appears for now to be less in the party than in the bureaucracy they are running. Besides it is unlikely to be a problem while the Left remains so closely implicated in the Rudd agenda.

The third potential problem is the uncertainty of international events. Rudd’s opening up of domestic politics to international geopolitics when it is in a state of flux is rare, and for a good reason. It can be dangerous for the political class of a middle power like Australia to reveal how little influence they have over international events. The rapid back away from the anti-Japanese whaling campaign highlights that there are limits to how much Rudd can throw his weight around. This is one area where the media’s portrayal of Rudd’s preference for symbols has a point. Such gestures like visiting Hiroshima and speaking in Mandarin are essential for a government that needs to appear to have an international impact when it really does not. Yet the international role is vital for a government that has lost it at home. It is well it is in the hands of an experienced diplomat.

Footnote: Three cheers to the ABC for having only one of the 30 complaints made by residents of Mutitjulu over a Lateline program technically upheld by the ICRP. The reading of the details of the ruling, however, reveal it for the shoddy piece of journalism it was and a useful precursor to that other piece of social worker prejudice the ‘All Children are Sacred’ report and the NT intervention a year later. We still await the arrests.

Rudd’s agenda

Given the media’s current dislocation from the political process, summed up by the bizarre panel discussion on Sunday’s Insiders, which painted the government as stumbling from crisis to crisis after a fortnight when it either held onto its massive polling lead (Newspoll) or increased it (Morgan), it seems as good a time as any to do a quick round up of Rudd’s agenda that is causing such media confusion.

Let’s start by what the media thinks has been Rudd’s agenda so far, but hasn’t really, the ‘symbols’ by which he started his term. Here Rudd was less setting his own agenda, than winding up Howard’s. Organising a homecoming parade for soldiers back from joining in a military campaign that Rudd was claiming only a few months ago to be responsible for the deaths of hundreds of thousands of Iraqi civilians, getting rid of Workchoices while bringing in the most anti-union agenda by any Labor government, or apologising for taking children from their indigenous parents while backing an intervention based on exactly the same premise, that they are incapable of looking after their kids; none of these ‘symbols’ make much sense in their own terms. What they do, however, is neutralise them as political issues. This is only possible because Howard’s stance on Iraq, the apology or IR had already been drained of any political meaning, so exposing a bankruptcy that was behind his defeat. Rudd has simply tidied up what was finished by the electorate in November.

While the media searched in vain in the Budget for an economic policy to point to an agenda to replace Howard’s, we must look elsewhere. So far, there are three clear components:

1) discrediting the old political process

No doubt there will come a time when some of the 1,000 best and brightest who flocked to Canberra in April will claim that the Summit had been a waste of time. They will be frustrated by its inability to influence government policy, lacking the political nous to know that the very premise of their participation, as hand-picked guests of Rudd and his Melbourne University mate, robbed the Summit of any political weight.

But the Summit was never about those who participated, rather it was about those who didn’t, namely the rank-and-file of the political parties, especially the ALP, who may have been under the delusion that it was their role to decide government policy. Irrespective how much Summit recommendations may have aped the ALP platform, Rudd’s declaration at the opening that the current political process could not set Australia’s long term direction helped to confirm the bankruptcy of the political process.

This was also the content of the ‘inflation crisis’ that targeted the spending plans (and hence the programs) of both sides of the fence as ‘reckless’. While the Liberals are still having trouble catching up with reality, the quiescence of the ALP, especially the way it was willing to sacrifice its programs to keep Howard’s tax cuts, shows that it already has come to terms with it.

2) the New Sensitivity

While the Budget showed that it wasn’t really possible to have an economic policy these days, it did show how the government intends to accommodate that fact. Rudd’s admission that there was little a government can do than fiddle around the edges may have sent the Liberals and the media into paroxysms, but to the electorate he was only stating the obvious. Those, like Gary Morgan, who think the downturn in economic confidence is bad news for the government, fail to realise how little it is held responsible for it. Government economic policy, as it exists, is not just about showing empathy with token gestures, but flattering the electorate by exaggerating the economic pressures in the first place.

3) opening up to the world

Australia’s foreign policy is fairly simple. It attaches itself firmly to the underbelly of which ever country is the global power of the day. The complications of Australia’s foreign policy are really the complications of the foreign policy of which ever power it has attached itself to.

Australia’s subservience in the global order, and the reliance of domestic politics on it, is not usually the topic of polite conversation in political circles in this country, especially since Vietnam. That's why at times when great power politics is in a state of flux, it is usual to try to present Australia's as an independent foreign policy. Despite Rudd’s talk of middle power diplomacy, Australia’s foreign policy remains firmly targeted on the great power (US) interests; the shift from Iraq to Afghanistan, the integration of China etc. As Keating has admitted, even the success of any significant regional initiatives by Australia is firmly in the hands of the US.

However, what is unusual with Rudd’s government is the degree to which foreign policy is being openly brought back home to bear on domestic politics. This has usually only been done in times of great power stability (Empire days, the Cold War). Rudd is now doing it at a time when US power is in a state of flux. Howard tried to create a domestic consensus with the War on Terror but with only moderate success. The clearest element of Rudd’s foreign policy with direct implications on domestic policy is, of course, climate change. Given the strong consensus for the terms of the climate change debate in the country, it probably will have much more success than Howard’s attempt.

Once the main planks of Rudd’s agenda have been set out, it is pretty clear to see the government’s weaknesses, which will be looked at in the next post.

Rats all at sea

The latest Newspoll has Rudd's popularity as preferred PM slumping to, er, 66% and Nelson's soaring to, um, 17%. The voting intention, of course, remained unchanged at 57-43. Given the screaming headlines over what a shocker of a week it has been for the government (and Nelson's increased exposure probably accounts for his better rating), it suggests last week was more about the media's changed relationship with the government than the electorate's.

There is a strange disjuncture between the media and the government at the moment. It is almost as though the government and the electorate are having a private conversation with each other while the media is left out, unable to understand what either is talking about.

Take the media's analysis of last week. It generally focussed on the machinery problems (leaks etc.) but could not get a fix on the politics of it and finally ended up denying there was anything much going on at all. The only grasp they had on it was that it seemed a repeat of Howard's interest rate promise and that the public had been let down by Rudd's admission that he could only do something at the margins. Yet the same latest Newspoll shows how the electorate interpreted what Rudd was saying. While a majority believed Rudd promised to lower petrol prices only 20% believe Labor is the most capable of doing so, 20% preferred the Liberals but a whopping 44% thought neither side was capable of lowering petrol prices. In other words, when Rudd proposed a bit of consumerist fiddling like PetrolWatch to take a couple of cents off, far from being the political gaffe the media presented it as, it was pretty well in line with what the electorate expected.

What has happened here is that throughout the election campaign, and after it, Rudd has lowered expectations about what government is capable of, in line with what people generally think. The media has not yet, by and large, followed them down. It still sees it as a political game of broken promises without seeing how the promises are changing.

For the media, the early days of Rudd were full of symbols, without seeing what he was really doing, getting rid of Howard's political symbols. They then waited breathlessly for the real agenda of the government to emerge in the Budget, but it never came. That only made last week's kerfuffle seem like a double disaster because it looked to be taking attention away from the Budget. The Australian cried that the petrol row meant that the government's economic message had been lost and it could now not sell the Budget. But the government never had any economic message to sell in the first place, except for its New Sensitivity backed by the type of consumer action talked about last week. Perhaps of all the commentary, it was Ross Gittins who got close on the absence of the usual political agenda in this government.

Nor does the media see the political basis for this scaling down in the climate change agenda. For them last week only makes it harder for the government to propose putting up petrol prices to fight global warming. In fact, the reality is upside-down, the climate change agenda will only further depoliticise rising petrol prices and further legitimise the government's inability to do anything about it (already some are saying that maybe higher prices are not so bad as we should be thinking of alternatives anyway).

The media are not helped by the fact that the Liberals are also struggling to catch up with this new scaled-down politics (it especially confuses those sections of the media close to the coalition). It is understandable the Liberals are unhappy about this, as they are now left with little base for posing an alternative. Rudd meanwhile poses himself less as the politician, but the technocrat functionary extraordinaire, and must be only too happy to hear the complaints of public service officials and tales of his workaholic schedule. Probably the biggest sign of the confusion of both the Liberals and the media, is that they both think this is bad news for the government!

More than five cents worth

George Megalogenis sums up the confusion in some parts of the media over what happened last week. It was not about Labor's 3.8c off petrol versus the Liberal's 5c cut. It was about the political class renegotiating its relevance with the electorate in a period when political parties have lost their meaning.

It has been forgotten that what sparked it off was Rudd's comment that government could not do much to deal with petrol prices. This openness of the limits to government powers was largely unprecedented in Australian politics, but it was the basis of Rudd's campaign against the Liberals, and his own side, last year (the Insiders panel are totally wrong to say it is comparable to what happened with Howard on interest rates last year - Howard never admitted there was little he could do). What we saw last week was the Liberals' difficulties, as we saw last year, in coming to grips with this new openness.

Nelson is doing quite a few things wrong but what he is at least attempting is the empathy thing, and trying to make the government look out of touch. There are grounds for making that claim at some point because this government has no social base. However, he has not yet found the way, or rarely had the opportunity, to make it. He thought he had an opening when Rudd said there was no silver bullet for petrol prices, but in fact Rudd was merely stating the obvious. The weakness of Nelson's alternative, the excise cut, just proved Rudd's point. That Rudd responded with the possibility of a small cut of his own only serves to show that it is all fiddling around the edges. Megalogenis's article misses the fact that such trivial measures just reinforces Rudd's main political message – there is little governments can do.

The impotence of government underpins Rudd's anti-politics message. It is why he is on a winner with his attacks on the public service. However he deals with them internally, the external political message that they must work harder is totally in tune with his agenda, and those in the press thinking that publicising such complaints are undermining the government are actually supporting it. There is little reason why Rudd and Labor's popularity will be affected by what happened last week.

It is also why, at a guess, this government is likely to break tradition with recent ones and not go for an early poll. If anything, Rudd will campaign for a fixed term to take elections out of the hands of politicians. Nelson's talk of an early poll is for the same reason as for so much of what he does – to maintain some cohesion behind him.

The overwhelming need to keep the Liberal party behind Nelson is undermining his bid for empathy as the party leadership worries about the damage such 'caring' does to the prestige of the party with its core support base. It is why Nelson can never get the tone right and sounds shrill when he cares, he has no political basis for empathy in the party he leads. In fact it is likely, with the Turnbull threat receding, that the party leadership will be more inclined to change tempo and go in hard. Big mistake.