Social liberalism fits Labor
John Howard once called himself the Liberal Party’s most conservative leader. His successors, however, have outdone him. Scott Morrison and Tony Abbott are easily more conservative than Howard, who has now slipped to bronze on the ranking of most conservative Liberal leaders. The brand of “just say no to change” conservatism that has dominated the modern Liberal Party is incompatible with small-l liberalism.
Small-l liberals such as George Brandis, Christopher Pyne and Malcolm Turnbull are out. It is little surprise that genuine liberals such as John Hewson spend more time criticising than praising the party they once led. The Liberal Party of Australia is now a LINO party: Liberal In Name Only. It’s a fitting acronym. After all, lino was Australia’s favourite floor covering in the 1950s.
Small-l liberalism means recognising that open markets are fundamental to boosting prosperity and standing up for minority rights. It means valuing both markets and multiculturalism.
After Labor’s unexpected election loss, our renewal may be found in an unlikely spot – welcoming not only those inspired by egalitarianism, but also those motivated by social liberalism.
There was a time when the Liberal Party was a party of liberalism. At its founding in 1944, Robert Menzies said, “We took the name ‘Liberal’ because we were determined to be a progressive party, willing to make experiments, in no sense reactionary.” Menzies never once used the word “conservative” to describe his party.
Howard took a different view, arguing the party was the custodian of two traditions: conservatism and liberalism. Abbott went further still, saying it was responsible for three traditions: “liberal, conservative and patriotic”. Small-l liberalism’s stake in the Liberal Party has been diluted from 100 per cent to 33 per cent.
Turnbull was the party’s most liberal leader since Malcolm Fraser but was ultimately unable to bring his colleagues back towards the centre. Even the most modest steps towards a market-based approach to tackling climate change were too much for the reactionaries in his party room.
In his place, Morrison is largely defined by what he opposes rather than by what he supports. Amid a cacophony of clichés, he seems largely untroubled by any need to set out a governing agenda. His is a deeply conservative government. How good is the status quo?
And then there’s the other side of politics. Social liberalism already underpins many of Labor’s achievements. Broad-based income taxation under Curtin. The Racial Discrimination Act under Whitlam. Trade liberalisation and a floating dollar under Hawke. Enterprise bargaining and native title under Keating. Removal of much of the explicit discrimination against same-sex couples under Rudd. Emissions trading and disability reform under Gillard.
At last month’s election, our platform included an Australian republic, a national integrity commission, tax reform, competition reform and a Future Asia plan to engage with the region.
Whether through support for individual liberties or the belief of open markets, social liberalism has a prominent place in the story of the Australian Labor Party.
Labor will always be the party of egalitarianism. And in fragile economic circumstances, egalitarianism demands that the government stand ready to step in if the economy suddenly stalls. Workers who lose their jobs in a crash tend to be people who have the fewest skills, those who are already living pay cheque to pay cheque. Saving the jobs of the most precarious workers is what Keynesian fiscal stimulus is all about. When the Australian economy is in the longest per-capita recession since the 1980s, and global storm clouds darken the sky, it’s risky to commit to expensive tax cuts in 2024. If you were about to sail an ocean liner through uncharted waters, would it be prudent to sell off the lifeboats and spend the money upgrading the first-class cabins?
Labor holds true to the belief – grounded in the reforms of Hawke and Keating – that tax reform requires broadening the base in order to lower the rate. This year marks 20 years since the GST legislation passed the parliament, and 20 years since the Coalition was last willing to engage in serious tax reform.
Social liberalism also demands answers to Australia’s productivity crisis. While labour productivity surged under the Rudd and Gillard governments, it has since slumped. As the Productivity Commission reported in its latest Productivity Bulletin, labour productivity growth is now below its long-run rate and fell every year from 2015 to 2018. Spending on research and development is in the doldrums. As the commission notes, “The share of businesses that are innovators – which goes beyond R&D spending – is no longer growing.” A progressive productivity agenda requires smarter investment in education, more targeted infrastructure spending, and updating competition laws to keep ahead of multinational monopolists that threaten to crush domestic start-ups.
One of the things I learnt from my role as Labor’s competition spokesperson over the past two parliamentary terms is the bargaining position of small businesses has a lot in common with the bargaining position of employees. Just as a fragmented workforce can be vulnerable to exploitation by a large employer, so too small businesses often find themselves facing a “divide and conquer” strategy from big firms. Think of companies that sell most of their output to the large supermarket chains, family-owned automotive dealer franchises negotiating with global car manufacturers, or boutique hotels paying a 30 per cent fee to list on online booking platforms. Just as in industrial bargaining, these small businesses often find that their choice is to hang together or hang separately. Social liberalism isn’t just about the freedom to organise; it’s also about the freedom of small businesses to work together to get a fair deal.
In social policy, Labor is committed to more rigorous policy evaluation, using approaches such as randomised trials to put theories and prejudices to the test. As the American judge Learned Hand once said, “The spirit of liberty is the spirit which is not too sure that it is right.” This more modest approach to social policy ensures that the government evaluates new ideas more rigorously: scaling up those that work and discarding those that do not. It also turns out this is a far better way to achieve egalitarian goals. You can’t reduce poverty with social policies that don’t work.
Internationally, social liberalism demands engagement with the world, and a recognition of the value of trade, migration and foreign investment in spurring on Australia’s prosperity. At a time when the World Trade Organization’s dispute system is threatened with collapse, Australia is nowhere to be seen. We should not only be trying to avert the crisis: Australia should be at the forefront of rebuilding the WTO into a body that can strike good-quality multicountry deals. The last all-in trade agreement was signed in 1994; attempts to conclude another one have repeatedly failed. Yet rather than allowing the system to devolve into a “spaghetti bowl” of bilateral deals, why not remake the WTO into an organisation that is focused on helping groups of like-minded nations reduce trade barriers in a way that boosts rather than diverts trade?
A commitment to social liberalism can also be seen in Labor’s commitment to an open, multicultural and multifaith Australia. When I listen to the first speeches of Labor members, I sometimes wonder what my party’s founders would have made of the paeans to multiculturalism and migration that have become central to Labor maiden speeches in recent years.
Many of Labor’s founders regarded Asia’s peoples as the biggest threat to their living standards. But ours is a party that has evolved and changed over the decades through its embrace of social liberalism. Instead of going backwards, it recognises that Australia benefits from immigration, including circular migration. National growth isn’t like the Olympic medal tally: prosperity in China, India and Indonesia will boost Australian living standards, too. And it understands the importance of honouring people of different faiths, as well as those of no faith.
A commitment to social liberalism requires that Labor be the party of civil liberties. Does everyone remember the February raids that followed the Morrison government’s leaking of a classified briefing document on the medivac bill to The Australian? No? Perhaps that’s because they didn’t happen, despite the briefing drawing on advice from the Australian Security Intelligence Organisation.
Yet when documents are leaked that embarrass the Coalition, they are willing to turn over a journalist’s kitchen, and raid the ABC with a warrant that allows the collection – and deletion – of key files. The stories in question related to allegations of unlawful killings by Australian special forces, and apparent considerations of giving government agencies greater powers to spy on Australians. Both are clearly in the public interest. The New York Times’ report of the raids was headlined, “Australia May Well Be the World’s Most Secretive Democracy”. To ensure that security concerns do not ride roughshod over fundamental liberties, it’s time to revisit John Faulkner’s proposal to toughen parliamentary scrutiny of our intelligence agencies.
Alfred Deakin’s liberals joined with the conservatives in 1909 in what was dubbed “fusion”. More than a century on, social liberals have been cast out of the Liberal Party of Australia. Today’s Liberal Party is not the party Menzies founded. It is now the creature of John Howard and his intellectual heir Scott Morrison. It is, in essence, a party of “capital-C Conservatism”. And that leaves social liberalism free for just one party.
This article was first published in the print edition of The Saturday Paper on Jun 29, 2019 as "Liberalism and Labor". Subscribe here.