John Hewson
Smart policy v dumb politics in a pre-election year

Prime Minister Anthony Albanese has often spoken in terms of football analogies when referring to his electoral opportunities, strategies and chances. Recently his focus has been on “coming home in the second half with a strong wind at his back”.

However, while this framing works for Albanese, I fear that, from now through to the next election, we will be smothered by an unedifying and demeaning daily media barrage about who is edging in front or dropping behind, both individually and as a team. There will be market odds posted on who has the edge and the answers to the major social and economic challenges facing our nation.

I expect worse than the referendum campaign. We will see attacks on the government’s honesty, unfounded assertions and gross misrepresentations. I’m concerned a climate of fear, scaremongering and character assassination will categorise this campaign. Mostly, I imagine it will just be pointscoring for some perceived or hoped-for short-term political advantage, with little or no concern for our national interests.

Unfortunately, this is an environment sponsored and fed by much of the mainstream media, especially Sky News and Nine, which have already picked their champions and launched their campaign strategies, as indeed they did with the referendum. So many of their junior journalists and even some of their old guard are obsessed with “gotcha journalism”, compounded by the responses of the ignorant trolls on social media who naively suggest there are simple solutions to our mostly complex social and economic challenges, with little interest in good government – they just want to be players in the melee.

As one who has spent much of his working life advocating for sound public policy, as essential to good government, both in the Treasury and the Reserve Bank of Australia (RBA), in government and from opposition, and globally at the International Monetary Fund and the United Nations, I am tired of this malicious and irresponsible political game. These are among the most difficult global circumstances, both economically and politically, that I have ever seen. It is more important than ever that this next election campaign be genuinely a contest of ideas, of the alternative policies and strategies for dealing effectively with Australia’s social, environmental and economic challenges. It should be more about policy evidence and substance. In the words of former Victorian premier Daniel Andrews, it’s about “doing the work”.

I want the parties and candidates challenged to define how they would like to see Australia at the end of this decade, and to set out the policy changes they think would be required to achieve that vision.

Our economic challenges have been well mapped by the UN in its recent “World Economic Situation and Prospects” report, which predicted “strong headwinds” for us and our region. The report sees inflation remaining sticky this year, near 3.3 per cent due to rising rents and housing supply shortages, and overall growth slowing to 1.5 per cent from 3.7 per cent in 2022. Their inflation forecasts were broadly in line with those of both the RBA and the Treasury, and consistent with a return to the central bank’s target range in 2025. Australian Bureau of Statistics (ABS) data released on Wednesday showed headline inflation in November slowed to 4.3 per cent from October’s 4.9 per cent. That’s the slowest pace since January last year and below economists’ forecasts. Perhaps this means the cost-of-living issue may lose some steam as we move through this period. However, the politics of it will be driven by whether the RBA has indeed finished raising interest rates, and whether the supermarkets are embarrassed enough by any evidence of price gouging arising from the Senate inquiry to actually lower key prices.

It seems likely housing affordability and supply will remain a crucial theme of this pre-election year. The latest ABS figures, while bringing good news on inflation, showed housing costs still accelerating, up 6.6 per cent on the year. Recent expert commentary casts doubt on the government’s ability to meet its promised provision of 1.2 million homes in the next five years. At this stage neither major party has an effective, deliverable housing policy, and the Greens are running hard on the emerging rental crisis in key Labor seats. Personally, I believe our governments – both state and federal – need to coordinate their strategies to genuinely increase housing supply.

More broadly, the UN report’s pessimistic assessment of the prospects for the global economy emphasised several significant risk factors, including weaker growth in both China and the United States than previously thought, a possible resurgence of global inflationary pressures, a spiralling debt crisis and lacklustre investment growth. All of these are complicated by several possible extreme weather events and by a range of geopolitical tensions, including the possible escalation of conflicts. I would add to this list the possible re-election of Donald Trump in the US. All of these risks are significant to a trading nation such as ours, tied so closely to the US, and they will demand an informed substantive public discourse to ensure voters are adequately informed.

The main challenge for the government, while dealing with all of the above, will be to get credit for what it has achieved in its first term. Traditionally governments have run on their record; however, few have had to endure the negativity and division that has been the opposition’s strategy under Peter Dutton. He has, to some extent, put the government on the back foot with his attempts to create the impression Albanese is incompetent or neglecting his responsibilities to govern while “distracted” by an expensive Voice referendum and overseas travel commitments. These characterisations have too often been reaffirmed or allowed to run unchecked and unchallenged by much of the media. As a result, the government hasn’t been rewarded for stepping above day-to-day political pointscoring, and focusing instead on addressing structural failings, especially in the care sectors and in budget repair – both of which had been sorely neglected by previous Coalition governments – while also delivering a very significant cost-of-living package with minimal inflationary effect. The government can also claim progress on the essential energy transition, while creating thousands of new jobs, initiating some recovery in real wages and beginning to address gender pay gaps. The government will need to seize the narrative on all these initiatives, while also setting out the detail of a second-term agenda.

Correspondingly, the opposition needs to define an alternative vision for our country. Criticism and negativity will not be enough to move voters. Specifically, it will need to put some meat on the bare bones of its policies. For example, the Coalition’s sustained criticism of the inadequacy of Labor’s response to the cost-of-living crisis begs some explanation of what else should be done, and how, with minimal inflationary impact. Similarly, the opposition’s criticism of reliance on the RBA for an effective anti-inflation strategy, and its push for more input from fiscal policy, needs more detail. In a similar vein, it is meaningless to advocate for nuclear energy as an alternative to the government’s renewables strategy, without any information on the rollout, costings or waste disposal. More is needed to ensure the reliability of small modular reactors – that’s assuming they can be delivered here when they haven’t appeared anywhere else around the world – and to identify the seats where such reactors could be located. And assuming these details can be provided, the opposition must explain the merit of nuclear as an effective and necessary step for Australia to take in the near term, against cheaper and more reliable alternatives.

The Coalition must also show how it plans to deal with Indigenous disadvantage, having made such a show of rejecting the Voice as inadequate to close the gap. Having led the “No” campaign to victory in the referendum, Jacinta Nampijinpa Price and Nyunggai Warren Mundine are nowhere to be seen, and the Liberal and National parties must deal with a clear breach of trust on their policies with respect to First Nations people.

The Coalition will also need to convince voters it understands and has addressed the issues on which it has lost support, namely among women, young people and voters in the seats that went to the teal independents in the 2022 election. On the latter, it is unlikely it can hope to win back any of these seats as, in general, the independent candidates have cemented their standing with the communities they now represent. As of now, only one Liberal has clearly indicated an intention to re-challenge a seat lost to a teal, and that is Tim Wilson in Goldstein. The only progressive issue that I can recall Wilson fighting for was same-sex marriage – an issue in which he had a personal stake. He has been weak on climate and ran into difficulties over his position on section 18c of the Racial Discrimination Act. What’s more, Zoe Daniel has done a great job to establish her standing in the electorate.

An early test for Dutton will be the Dunkley byelection. He will want to avoid a rerun of his historic loss in Aston on April 1 last year, in what will be another litmus test of how the mortgage belt votes. It’s a seat Labor should retain, and Dutton may lose others to independents – the most likely being Bradfield on Sydney’s upper north shore. It’s hard to imagine Dutton could win here by sustaining his negativity and hard push to the extreme right. Voters want to know the detail of exactly why a Coalition government would be better than a second term for Albanese. Dutton will need to give clear reasons why they should now support a Coalition that lost the most recent election over its lack of integrity and accountability and its failure to deal with the big issues, from climate to the care sectors, the robodebt scandal and the cost-of-living crisis.

In commenting on the release of the UN report, Secretary-General António Guterres said 2024 would be a “tough” year, but “it must be the year that we break out of this quagmire”. This should certainly be the case for Australia. It is time to address the hollowness and inadequacy of our democracy and its debate.

This article was first published in the print edition of The Saturday Paper on January 13, 2024 as "Smart policy v dumb politics".

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