Spectres of Beazley

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In the seven weeks since the Abbott Government delivered the Liberal party’s first Budget the Labor Party has settled on a political strategy that is reminiscent of two Opposition leaders: Tony Abbott and Kim Beazley.  As leaders of the Opposition, Abbott and Beazley were both gifted issues by the Government of the day that enabled them to mount populist campaigns that built support for their parties at the polls. For Tony Abbott it was the carbon tax; in Kim Beazley’s case it was 1996 Budget and then the GST.

With Newspoll’s annual post-budget survey finding that 69% of voters feel worse off as a result of the Abbott Government’s Budget, the Shorten-led Labor Opposition finds itself in a similar position to both Abbott and Beazley. From the Medicare levy to the lifting of the retirement age to 70, the Budget has given the Opposition plenty to complain about. It is no wonder that the same post-budget Newspoll had the Abbott Government’s two party preferred vote down to 45%. On the other hand, the Labor Party, less than nine months after registering a two party preferred vote at the election of 46.5%, was sitting comfortably on 55%. Yesterday’s Newspoll confirmed these numbers.

PM Tony abbott: Image credit Bidgee/wikipedia

For a Government during its first year in office, these are an unpleasant and unnerving set of numbers; but for the Labor Party, history suggests that these figures might represent a dangerous temptation to become a purely populist and reactive Opposition.

In order to appreciate the temptation and risks for the Opposition it is worth considering the mistakes that Kim Beazley made as Opposition leader during the first two terms of the Howard Government.

When the Howard Government cut services in its first two budgets, and then announced its intention to introduce a GST if re-elected in 1998, the Labor Party saw it as an easy opportunity to win back the “battler” voters that it had lost at the 1996 election.  This strategy almost succeeded at the 1998 election when the Howard Government clung on to power despite losing fourteen seats, suffering a 4.6% swing and only managing about 49% of the two party preferred vote.

Beazley’s political strategy was populist and reactive: it always complained about the decisions that the Howard Government made but it never successfully challenged the Government’s overwhelming arguments about the need for reform. Nor did it develop convincing enough policy proposals to persuade voters that there was an alternative to the Government’s hard-line economic policies. Instead, the Opposition narrowly appealed to its Labor base, and abandoned much of its sensible and hard-headed economic positions of the Hawke-Keating years.

Kim Beazley in action mode: Image credit: PD-USGOV-MILITARY/wikipedia

As a consequence, Beazley did not command a sufficient amount of respect on economic issues as Opposition leader and he never adequately distinguished himself beyond a likeable and decent public persona. The result was that, after the election was called in 2001, the Opposition had to run a series of advertisements featuring Beazley explaining his views on health and education.

By contrast, John Howard had spent years in Opposition during the 1980s and 1990s advocating for policies he believed in. This was particularly the case with economic reform, where Howard had supported many of the Labor Government’s reforms and developed a reputation for being a serious policy brain.

Surely some lessons ought to have been learned from the Howard years? After all, the Opposition contains many senior people with considerable experience of Opposition. Anthony Albanese, Kim Carr, Stephen Conroy, Tanya Plibersek, Joel Fitzgibbon, Jenny Macklin, Warren Snowdon and Brendan O’Connor were all members of the Opposition in the Howard years.  Nevertheless, there are early signs are that the Labor Party has learned little from being in Opposition during the Howard Government. Shorten and his team seem determined to sleepwalk through Opposition by apeing the “relentless negativity” that Tony Abbott so devastatingly deployed during the Rudd and Gillard Governments.

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Abbott’s approach to the carbon tax in Opposition was formulaic: play down the magnitude of a problem, highlight the unfairness and injustice of the Government’s policy, ride this wave of resentment from one media appearance in a marginal seat to the next, and quietly propose a weak but vaguely defensible policy alternative like Direct Action.  This worked for Tony Abbott for a number of reasons, including the oft-forgotten fact that from about 2010 onwards the Coalition held a consistent advantage on the single most important issue to voters: the economy.

Fairly or not the voters have traditionally given Liberal Governments a regular lead on the issue of being the better economic managers; Labor is preferred on social issues like health and education.

Rather than directly confront the economy as an issue, however, the Opposition protects this perceived vulnerability by avoiding a head-on policy argument with the Government. This effectively concedes the issue to the Coalition and allows them to frame the debate in a manner favourable to themselves.  For instance, the Government’s rhetoric of a “budget emergency” is not entirely accurate, but it does highlight a genuine fiscal problem for the Commonwealth. Numerous analyses—from Treasury to Deloitte Access Economics—indicate that the Budget needs to be reformed for “structural” reasons or else Australia risks a long-term and unsustainable escalation of public debt.

Former PM John Howard. Image: US DOD/wikipedia

As the Grattan Institute stated last year, “[Australia’s] budget squeeze comes from rising health costs, likely pressure on welfare spending, an inevitable fall in the terms of trade, and… big-ticket initiatives such as paid parental leave, new school funding and the National Disability Insurance Scheme.”  Voters may not buy the “budget emergency” but thanks to the Government’s advocacy about this problem they will probably accept the underlying argument that fiscal reform must happen in the longer term. The begrudging acceptance of the Howard Government’s first Budget, and subsequent taxation reform, prove that voters can be convinced that unpopular measures are sometimes necessary.

It is all very well for Shorten to take his road-show from primary school to GP clinic, but without articulating an argument for what Labor will do to fix the Commonwealth’s long-term fiscal problems, like Beazley he is leaving himself dangerously exposed to losing the bigger argument on the economy.

Acknowledging that the Commonwealth has a fiscal problem does not necessitate the Opposition buying the Government’s “budget emergency” argument. But a failure to articulate a sensible economic policy position that aligns with the Labor Party’s values and principles will ultimately involve the Opposition conceding this issue to the Government—and probably the next election with it.

Julia Gillard liked to say that Budgets are about choices. She was right. The Opposition has its own choices to make. In doing so it ought to be mindful of some of its spectres from recent Labor Oppositions past.

Timothy Wilson was an Adviser to Martin Ferguson, the former Minister for Resources, Energy and Tourism in the Rudd and Gillard Governments.