31 December 2010

2010 - the year behind

2010 was one of the more interesting years in Australian politics as one prime minister was removed and the successor failed to seal her legitimacy in the subsequent general election.

The beginning of the end of the Kevin Rudd era was deciding not to create either a tax or market mechanism to regulate carbon emissions (or call a double dissolution election to create a ‘mandate’ to do so) to deal with the ‘greatest moral, economic and environmental challenge of our generation’ following the failure of international talks in Copenhagen the previous December.

Kicking the ‘greatest moral challenge’ into the long grass established a meme of a government that overpromised and underdelivered, something exacerbated by problems with rolling out the ‘Building the Education’ revolution school building programme and the ‘pink batts’ debacle.

The Government’s problems were heightened by the proposed imposition of a tax on mining profits without following the usual protocols of fully informing affected taxpayers of the proposed change prior to announcing the proposed change.

This led to a highly aggressive attack on the Government by the mining industry and a broad view of a government in panic mode adopting populist policies without a full assessment of outcomes.

When all this was coupled with increasing discontent about a dictatorial Prime Ministerial style and a dysfunctional office, ‘the faceless men’ of the ALP backrooms moved to replace Rudd with Julia Gillard to improve a government that had ‘lost its way’.

An early election intended to cash in on the ‘honeymoon’ of Australia’s first woman prime minister was called. But there was no honeymoon.

The legitimacy of Gillard’s ascension weighed heavily on the campaign.

Moreover, the ALP always had an ‘upside down’ coalition of inner urban progressives who were increasingly supporting the Australian Greens.

They were challenged by an Opposition who had reduced their campaign to bite size slogans, such as: ‘we’ll end the waste. Pay back the debt. Stop new taxes. Help families. Stop the boats. Do the right thing’.

This led to a string of two bob each way policies that appeared to be designed by focus group – yes to an ETS….but only after input from a ‘citizens assembly’; offshore processing of refugees……but in East Timor and not Nauru; immigration was not about numbers coming into the country………..but merely where they lived. And so on.

Labor were finally buffeted by unprecedented leaks about Gillard’s position on issues such as paid parental leave.

Ultimately, the ALP steadied but the damage was done. It became a minority government reliant on the support of country and regional independents as well as the first Australian Green elected to the House of Representatives.

Having got to Christmas, the Government has tried to frame the debate by nominating that 2011 is the year of delivery and decision.

Labor hopes to deliver on broadband and health reform and make decisions on issues such as fiscal consolidation (bringing the budget into balance) building capacity on the supply side with tax, superannuation, infrastructure and skills initiatives and extending market-based reforms to health and education, carbon (despite promising not to during the election) and water.

It will be the ALP’s burden to ensure that ‘moving forward’ with this agenda will lead to policy and electoral success.

The Liberals had a reasonably good 2010. Largely through implosion of the opponent, it was able to get within touching distance of government on the basis of stringent opposition of government proposals and making its own pitch at a (very) high level.

It will be interesting to see how much policy meat is added to the slogan like bones offered up in the election.

The final point of interest was the Liberal Party (as part of a coalition with the National Party) winning its first state or territory election in 27 attempts when it won in Victoria.

The result appeared largely to be an ‘it’s time’ result. However, there were two federal lessons to be learnt.

The first was that in deciding not to provide the Greens any preferences, the Victorian Libs proved that you can take on the Greens without being seen as anti-environmentalist and suffer an electoral backlash.

The second lesson was that suburbia is feeling the pinch of high utility prices. This will be an increasing factor to take into account when ‘putting a price on carbon’ is ultimately unambiguously translated as being ‘increasing electricity costs’ as the carbon debate comes to a climax during 2011.

Something for the Feds to consider during the year of decision and delivery.

10 December 2010

Labor's Growing Schism

The concept of the ‘labour movement’ is in trouble in Australia.

At the start of December the political wing of the movement has had a lousy fortnight.

The Victorian Government fell.

The NSW Labor Party had to sack its party president when his union’s journal suggested it would support individual candidates from all political persuasions.

The South Australian Premier needed armed police protection to enter his own state conference to defend a union sponsored motion to dump his leadership and to defend the State Budget

Finally, a union affiliated with the Queensland ALP is thinking about standing candidates against Labor because of anger about the privatisation of assets such as Queensland Rail.

These states have (or had) long term Labor governments operating as being solid, conservative managers of the economy that moved to the centre on traditionally weak areas such as law and order and encouraged development whilst showing concern for the environment.

However, this model appears to have reached in use-by date, with the greatest pressure being placed on it by the ALP’s labour movement partner – the unions.

ACTU President Ged Kearney has publicly suggested that unions be prepared to criticise Labor publicly and be more independent of its traditional ally and her executive has endorsed a paper suggesting it be on a permanent campaign footing in a bid to advance an independent political agenda.

During the 20th century, There was a time that ‘the labour movement’ – the concept that permitted the representatives of labour and those who wished to express solidarity with the working class to operate within one political party – worked satisfactorily.

This meant in practice a coalition of employed workers and a professional class generally residing in the inner city.

However, the Greens ‘four pillars’ (ecological sustainability, social equality and economic justice, grassroots democracy and peace and disarmament and nonviolence) is an agenda increasingly appealing to a ‘progressive’ middle class constituency than one put out by a regimented party with 50% union control designed to achieve social justice primarily through the improvement of working conditions through the wages and taxation system.

At the same time both state and federal ALP governments are making decisions designed to introduce a ‘seamless economy’, including reforms designed to increase productivity – and as recent ructions illustrate, not every reform will be fully supported by unions as jobs and conditions come under threat.

The net result of trying to satisfy the social goals of the progressive professional classes and the industrial goals of the unions means that the ALP is not satisfying either part of its traditional disparate coalition.

Earlier in the year Dean Mighell openly questioned whether affiliation with the ALP remains in the strategic interests of the union movement whilst Michael Costa has again called for reform to remove the power of the union bosses.

In much the same way as there has been a ‘structural separation’ of the wholesale and retail arms of Telstra, any review of what constitutes ‘the labour movement’ may mean a structural separation of the movement’s erstwhile industrial and political arms.

As the traditional fault lines of labour vs. capital have blur to the point of being non-existent the unions can then prosecute the interests of members as they see fit, whilst the ALP can, should it choose, develop into a modern social democratic party so it can best compete in the Australian political market place of the 21st century.