Sunday, April 13, 2008

Advice from the enemy

I have never been one of Brendon Nelson’s greatest fans and preferred Tony Abbott to lead the Federal Liberal Party when that decision had to be made. Abbott is an intelligent conservative who predictably does not appeal to a mass audience. In addition I thought Nelson was a rather poor Minister for Education who operated in John Dawkins mode and was an indifferent Minister for Defence who approved the dubious Super Hornet deal. But I think Nelson, having been elected leader of the Liberals, should be given a chance and some time. He has the difficult job of leading the party back from defeat and should not be ‘white-anted’ from within. Given that the majority-preferred choice for leader, Peter Costello, will almost certainly resign, Nelson has the unenviable task of trying to restore the fortunes of a party which neither holds government federally or in any state or territory in Australia. He deals with a media hostile to the Liberal Party and under the spell of cliché merchant extraordinaire Kevin Rudd.

The Liberal Party should reject media campaigns to dislodge Nelson. These efforts are not designed to induce selection of a better candidate but are primarily aimed at consolidating Labor power. Today we experienced the manipulative gutter journalism from Melbourne’s Pravda which has maintained a steady campaign of trying to discredit Nelson. In a news story Pravda states that ‘unidentified senior Liberal sources’ have indicated that Nelson won’t last and that Malcolm Turnbull will replace him. It sounds like it might be half-true and that is a probably good enough for Pravda to launch yet another propaganda attack on the Liberals. The Chinese and North Korean communists could learn from this rag’s devotion to writing propaganda as ‘news’*. Quote:

It is believed that Peter Costello is preparing to depart politics, while Ms Bishop and Mr Abbott have ruled out challenging, leaving Mr Turnbull as the only genuine contender’. (my bold)
I suppose that on the basis of the ‘unidentified source’ almost anything can be ‘believed’ if it suits your political priors. One of the interesting things about the political left is that they don’t feel the need to cover their preposterous claims with well-thought-out alibis. While Peter Costello, Julie Bishop and Andrew Robb were cited in Pravda’s piece as denying the claims in its article they were (it was implicitly suggested) obviously just covering-up for Nelson and three denials of a made-up claim suggested, of course, that the claim has some substance. That’s presumably why the denials were cited.

But if Nelson is finished as leader this should be the decision of the Liberal Party not a decision of the party’s enemies in the gutter leftwing press, in the Labor Party or among Labor’s uncritical supporters. I agree with Andrew Robb that the Liberal Party should not be put off by ‘newspaper talk or others trying to trip us up’.

Last week John Quiggin offered help to the Liberals to stop them being ‘as irrelevant as they are now’ and ‘to support political competition’. John is one of Australia’s active economists who supports Labor. John’s prescription to the Liberals was simple – the Liberal Party should stop trying to restrict the size of the public sector, reducing costs in health care and so on. I thought these were strange claims for an economist - one who should seek to make best use of scarce resources - to make.

Instead , according to John, the Liberals should adopt the attitudes of the pro-public sector Labor Party. In short, the Liberals should become more like the party which defeated it. By so doing the Liberals will ‘increase ‘political competition’ and apparently perhaps ensure their survival.

One might reasonably question the sincerity of advice offered to a party which John obviously opposes and which, in the main, suggests the party behave like one John supports. My concern is that John might be seeking to encourage a political stance that would ensure the long-term irrelevance of forces hostile to the Labor Party.

John’s advice is based on what seems to be an endorsement of a view of government as a giant wealth creator which can (and should) hand out favors. John mentions Keith Hancock’s ‘caustic’ view of Australian attitudes towards Federal Government as ‘a vast public utility, devoted to the greatest good of the greatest number’ – Hancock was being critical of this obviously suspect view but John seems quite comfortable with it himself. John states unequivocally that Labor shares Hancock’s view (enough from my perspective to condemn Labor eternally) as did John Howard. The problem for the Liberals was that their support was just not deep and sincere enough. Indeed they even dared question the value of public servants and government spending! Good god!

No political party in Australia should endorse this view of government’s role and the Liberal Party should fight it. We do not live in a socialist society where governments should seek to make ‘the greatest number’ happy since governments don’t have that good a grasp of what motivates the citizenry. Indeed, even if this doubtful prescription were the belief of most Australians, then it is subject to a host of practical and philosophical objections that should lead to its rejection. It is clearly wrong. Governments distribute wealth but generally do not create it**. Government interventions should target market failures and modify the extremes of income distribution to favour the most disadvantaged but not the views of politicians and bureaucrats on what will make most of us happy.

Again, in my view the Liberal Party should avoid accepting advice from those who ideological position stands as one of opposition.

The Liberal Party should have continued to support the workplace reforms that helped reduce unemployment to a 34 year low and which gave Australia the strongest sustained period of economic growth for a century. Generally the Coalition provided a superb period of public administration in Australian. The difficulty was that the stability and prosperity delivered created both unwise investment choices and the risky selection of daft political options among the public. Australia became complacent about the risks of giving power to the Labor Party wreakers.

The reforms introduced by the Coalition will make sense as unemployment and inflation steadily worsen (as they will under Labor), as employment markets are re-regulated and debts to the union movement are repaid by disastrously encouraging ‘preservation of the real wage’ as an ethic in the face of oil and food price increases. These foolish policies reflect, in the main, a commitment to populism.

The Liberals should clear the slate and accept their mistakes. They should accept that unseemly handouts were made by them during their last period in office - and make it clearer than ever that the ‘social services for all’ ethic should not be government policy. Instead, emphasis should be on the role of private markets in driving our current wealth with caution being exercised on public spending. They should continue to emphasise the efficiencies that follow from making people responsible for their own lives by taking their own private actions to secure their health and their retirement security. Social security and the welfare state should protect the needy losers not the ‘greatest number’ of winners who are doing well out of free markets.

Most of all, the Liberals should not be defensive about the outcomes from their term in office because of the unparalleled period of prosperity it has induced.

With high probability the inexperienced riff-raff and power-hungry trade union hacks of the Labor Party will damage Australian society and its economy . This will particularly be so given the current short-term credit and oil price shocks impacting on the economy. Labor has never have offered much more than imitative ‘me-too’ politics, cliché and symbolic gesture – so as a political force they are easy targets.

Labor’s policy failures and its corruption and widespread scandals need to be uncovered, documented and publicised. Then, as the predictable public policy disasters unfold under Labor, comparisons need to be drawn between the high quality public administration and sound government under John Howard and that offered by Labor. This is the perspective Brendon Nelson should be pursuing and the party should support him in this. If the party seek to replace him this should be done on the basis of advice from friends not from enemies.

* Suggested masthead for Pravda ‘We don’t report the news. We write it’. (Thanks William S. Burroughs, Nova Express).

** No I don’t believe stories that public firms have a lower cost of capital than private firms and can hence be more cost-efficient. The inefficiency costs of having enterprises run by administrators beholden to pollies who have never done a day's work in their lives, rather than businesspeople responsive to a bottom line conditioned by private sector views, are manifestly too great.


Anonymous said...


On the one hand you admit that Nelson is being "white-anted from within" and yet you blame the media for reporting this.

In fact, the Age was a day late on the whole story. See Greg Sheridan:,25197,23526436-601,00.html

Mark U

hc said...

I didn't see that but not surprised. The Australian is at it again this morning.

My claim is that 'white-anting' should not occur. Give the guy a go and if he fails vote in someone else. But sniping by means of anonymous posts to the gutter press does not help the Liberal Party.

conrad said...

Does anyone will really think Nelson wasn't put in as the fall guy? I imagine the only real variable of interest was how long he was going to last. My guess is that it if Kruddy presides over a harsh budget, then Turnbull will get in if the Liberals can think of any decent ideas, which it seems they can't at present (I can't think of anything that Brendan Nelson has actually done, so its clear his unpopularity is not related to his actions, excluding his sympathy for bankers).

I agree with you on about the part about the Liberal party and government -- Kennett got in promising huge cuts and so forth, and it worked just fine. Surely people will get sick of huge governments, although I imagine only when they actually look like they are going broke (like the Vic Labour Party was). I don't agree with you about Tony Abbott -- he's like the old school Liberals that essentially are irrelevant now. If they want to be a force, they need someone new. If Turnbull can do a good job and offer some new (decent) ideas, I'm sure they'll revive a bit.

Anonymous said...

Harry, the media story that Nelson's demise is imminent was kicked off by Piers Ackerman a week or so ago. He was fed his lined by Nelson's enemies in the Liberal Party. And Ackerman of course is one of You.

It's preposterous to say this is all due to a campaign by the Age.

If the Age was true to the leftist beliefs that you say it has then it would be campaigning to keep the Nightwatchman exactly where he is, for as long as he remains leader the Liberals will be at rock bottom.


John Quiggin said...

"Kennett got in promising huge cuts and so forth, and it worked just fine"

I think this pretty much illustrates the problem. Kennett got in at a time of severe economic crisis, and lasted only two terms. As I said in the article Harry is criticising, if the Liberals want to be a permanent B team, only called in when Labor has drastically stuffed up, they are going the right way about it and don't need to change.

hc said...

Spiros, I didn't say the campaign was all due to The Age.

John, My point was that it is pointless to change by becoming a replica of the Labor Party - that isn't 'competition' - its giving up the ideals of conservatism and Liberalism.

It also does not make a lot of pragmatic sense given that with near certainly Labor will stuff up.

Spiros said...

The first flaw in your analysis Harry is your assumption that the election result was due to the Australian people taking leave of their senses and voting irrationally. On the contrary, the electorate knew exactly what they were doing. the Liberals themselves have admitted several times over that WorkChoices did them in. If they can see it, and they ought to know, why can't you?

The second flaw is your assumption that the natural order will be restored ASAP, with the Liberals taking their rightful place in government.

There is no reason to think this will happen. Since Whitlam, the average number of terms by a federal government is three and a half. Once governments are in, they stay in.

The third flaw is your assumption that the policy positions that worked for the Liberals for the Liberals when they were in government will be relevant in the 2010s.

conrad said...

HC: "given that with near certainly Labor will stuff up"

Looking at the current governments, like Iemma and Bracks, I think this really needs to coincide with bad external forces.

JQ: "Kennett got in at a time of severe economic crisis, and lasted only two terms"

I think it is important to note that severe economic crises don't necessarily have to coincide with political decisions. If there is a worldwide recession, people will unfairly blame whoever is in power (although perhaps not this time, given that the Labour party has not been in long), just like they unfairly attribute success to governments (e.g., Blair, Bush, Howard). I think people don't understand you can have non-neutral baselines.

Also, I think the main problem is getting in, not staying in. I don't think John Howard did an especially thrilling job, but he stayed in. Also, my feeling about Kennett is that he got the boot because he simply had run out of ideas and people were getting sick of him (not unlike Howard). The Labor party were also far better at politics, and were able to think of ways to bribe a number of marginal electorates much more effectively. Howard I think had a very similar problem in that the front bench of the Liberal party was full of worn-out old ministers, and they were up against what appeared to be (and still appears to be) a much smarter and more charismatic leader than Kennett had to worry about. On this note, I think that until Kruddy starts making some major mistakes (or at least things that are attributed to him), the Liberal party are pretty much doomed no matter what they do or what changes they make. I don't see anything particularily wrong with Turnbull (or Nelson for that matter), but they will have no hope if Rudd keeps up his current level of activity.

Anonymous said...

Every time you read the phrase"an un-named source" replace it with "the cleaner". It has the same level of credibility. A good editor would ban the practice of not naming sources. It is gossip masquerading as news


davidp said...

Hi Harry,

I am surprised you are not keener on Julie Bishop c.f. Tony Abbott as a possible leader. She was possibly the most outspoken in preserving pre-Work Choices AWAs and seemed to be an improvement after Nelson as Education Minister.


hc said...

I have watched Julie in action and very impressed with her. You are right that she showed more guts than the men (e.g. Shrek) when it came to WorkChoices.

She would make a good leader but currently the leader is Nelson and he should be supported.

davidp said...

Hi Harry,

I agree that unless there is some very serious problem that we don't know about, that it would be very very risky for the Liberals to change leaders in such a short period. It is hard to imagine how the possible benefits could exceed the almost certain costs of this. Alexander Downer spoke quite well on this on PM last night.

John Quiggin said...

I was just going to offer a clarification on your claim that I "support Labor", and your inference that my advice to the Liberals is therefore valueless.

Obviously, it's true that I prefer the present policies of the Labor party to those of the Liberal party. But, given Labor's obvious failings particuarly in certain states, I'd much prefer a situation where I could reasonably support the Liberals as an alternative. My advice is intended to promote that outcome

Obviously, if you regard everyone who currently prefers Labor as an enemy you have a recipe for permanent opposition. This seems to suit most Liberals at present, but I don't think it's good for the political process.

hc said...

John, This is what I wrote:

'One might reasonably question the sincerity of advice offered to a party which John obviously opposes and which, in the main, suggests the party behave like one John supports. My concern is that John might be seeking to encourage a political stance that would ensure the long-term irrelevance of forces hostile to the Labor Party'. (my bold)

I don't see anything there to retract. If the sort of transformation you advocate works we will have two mainstream parties in Australia with the values of Labor alone. That isn't helpful advice for those seeking to promote conservative causes.

That you would be happy to support the Liberal Party if it adopted the policies of the Labor Party suggests only that you support Labor Party policies.

The Australian electorate voted out an outstandingly successful Federal Government for no clear reason - perhaps they wanted a change. Less competent administration by Labor and the prospects of a deteriorating economy partly due to Labor policies shouls restore the fortunes of the Liberals.

In the meantime the Liberals should emphasise what was delivered to Australia while they were in office and not retract policies that are fundamentally sound simply on the basis of advice from their political opponents.

derrida derider said...

Strangely enough, I think the Lib's best chance would be if they moved rightwards on economics and leftwards on social issues.

We have a government which is fairly left wing on economics yet almost as conservative on social issues as the former government. When the economy slows (and tax cuts prove unaffordable) it will be good strategy to repudiate all that pork-barrelling, including the business welfare this government seems so keen on.

Small-l liberals on social issues - which really is the Australian mainstream if you look at social attitude polling - are underrepresented at the moment. There's a lot of vacant political space there. If I was Nelson I'd be lining up with the Greens on things like climate change and civil liberties. Of course that means disowning the culture warriors, but all successful leaders have to fight their own party first.