How could Labor get it so wrong? It had a terrific story to tell about the resilience of the Australian economy in the face of the global financial crisis. Its stimulus package was lauded internationally as a great success. Not only did the package put dollars in the hands of consumers at just the right time, the bank deposit and wholesale funding guarantee provided the structural foundation for financial stability in the face of the unfolding calamity in the US and Europe. While unemployment rose to dizzy heights in those regions, it remained historically low in Australia. Circumstances like these should be enough to win a second term in office.
The stimulus package had a dark side. It exposed the Government to corrosive criticism as cracks opened up in the Building the Education Revolution and Home Insulation schemes. The reality is that these are just the sort of programs that the Coalition would have introduced had they been in government at the time. The point of schemes like these is that they are generally rapid job generators but they do require slick execution to minimise risk. In the rush to implement, mistakes were made and while they were not killer blows for Labor, they damaged its credibility. The stimulus package should have translated into electoral triumph but in the end it was eclipsed by the crisis within.
Millions of Australians are worried about the implications of climate change and they wanted their government to take decisive action. Kevin Rudd's declaration that climate change is the greatest moral challenge of our time was a powerful statement that won the hearts and minds of many. While hopes were dashed by Coalition and Green opposition to the CPRS, it was a monumental political mistake by Labor to postpone its campaign to secure a price on carbon. It would have been better to have brought the issue to a head in a double dissolution than allow dashed hopes to corrode support. The big national swing to the Greens in the election demonstrates just how powerful this effect has been.
Policy stumbles inflict electoral damage. A tax that secured a fairer share of the wealth generated by the export of our mineral resources is an idea that most Australians would have supported if it was sold well at the right time. The Resources Super Profits Tax didn't fit the bill. It was a monumental political miscalculation to propose it just before an election. It mobilised the mining magnates and the Murdoch newspaper empire against the Government and gave the Coalition enormous oxygen in the mining rich States of Queensland and Western Australia. The gains to the Coalition in these States at the election tell this story.
Kevin Rudd spent his political capital quickly and had to go in the end. His dispatch and the pace of Julia Gillard's ascendancy might have taken people by surprise but it shouldn't have. It may have seemed brutal but those with good memories realise that this was a relatively tame affair compared to the leadership battles of the past. The reality is that under Kevin Rudd, Labor was dogged by serial political mismanagement, heading for certain defeat. Something had to be done quickly to regain some momentum for Labor.
The anointment of Julia Gillard as PM by the Labor Right faction provided a fascinating insight into the machinations of contemporary Labor Party politics. Factions make and break leaders and the Labor Right usually determines who is PM. Most of us are insulated from the reality of Party politics until leadership challenges remind us that political survival is about who has the numbers and who is able to deliver them to ensure victory.
Julia Gillard came to the role of PM burdened by political baggage but her cut-through style and dogged tenacity had earned her a great deal of respect in the wider community. She tried hard but couldn't entirely distance herself from the decisions of the Rudd-led Government that she was so enmeshed in. The immediate problem facing Gillard was how to stop the slide in Labor's popularity in the lead up to the election. Taking some of the heat out of the mining tax as an issue was masterfully managed by Gillard but it couldn't repair enough of the damage that had been done. Rejecting Rudd's 'Big Australia' agenda tapped into genuine community concerns about overcrowded cities and under-provision of infrastructure but perversely it also fuelled xenophobic views about migration and asylum seeker policies - a dynamic that the Coalition masterfully exploits at election time. Votes would have been won and lost in Labor heartland as a consequence of this stance. Labor obviously thought that it could make up some ground in Western Sydney by rejecting the Big Australia mantra and running a harder line on border protection. As it turned out the real electoral problems were not in New South Wales but elsewhere - in Western Australia and Queensland.
The post challenge-Labor leaks against Gillard were breathtakingly brutal and designed to undermine her credibility. They sucked oxygen out of Labor's campaign and fuelled the attack by a surprisingly sure-footed Tony Abbott.
When the tightly scripted Gillard faltered, the 'real Julia' was relaunched to the nation. It was a mistake to declare this metamorphosis to the world. Not surprisingly the very real Tony Abbott had a field day asking who the real Julia was. The real Julia turned out to be much more effective than the highly staged-managed version, putting pressure back on Abbott. In the end it seemed that Gillard ran out of time to shake off the Rudd legacy. Big picture reforms including the National Broadband Network, one of the largest nation building projects of the century and the Paid Parental Leave Scheme were lost in the political fog.
This article appears in the August 2010 edition of The Adelaide Review.
To access the original issues piece visit the Adelaide Review website.
