The world of Australian politics, everyone now accepts, is a very strange world indeed. Just nine months ago, Tony Abbott was Prime Minister, overseeing the world’s thirteenth largest economy in a critical period of geo-political and economic transition. Yet today, at the dawn of a federal election, he spends his early mornings handing out pamphlets at suburban ferry terminals.
Even as Prime Minister, Abbott always cut a forlorn figure. But the almost-pathetic innocence of Abbott-the-backbencher stands in stark contrast to the spectral presence of his legacy. Abbott’s knifing by his own party in favour of the moderate Malcolm Turnbull was justified at the time by the perceived need to provide ‘the economic leadership our nation needs’. While aggrieved conservatives railed and ranted, Turnbull continually soared over his opponent, Bill Shorten, in the approval stakes. Yet on the 8th of May, the day the Prime Minister called a federal election for the 2nd of July, a series of polls showed Shorten’s Labor Party to be neck-and-neck with Turnbull’s Liberal-National Coalition. Gone, then, are the days when the power of incumbency was considered sufficient in itself to guarantee a second term of government.
A Labor victory would be an extraordinary outcome: in a Lower House of 150 seats, the centre-left party currently holds just 55, meaning it will need to gain 21 to attain a majority in its own right. But these are, after all, extraordinary times. I wrote in this paper back in December that ‘Malcolm Turnbull will need to rely on solid polling figures, his predecessor’s quiescence, party solidarity and a slice of good fortune to navigate Australian politics’ out of its morass. Predictably enough, none of this has since come to pass: Labor stands even in the critical two-party preferred polling figure, Abbott has loudly and persistently defended his legacy through veiled critiques of Turnbull’s new direction, in-fighting has erupted within the Coalition in regard to electoral pre-selections, and, above all, the economy continues to teeter. On election eve, the Reserve Bank unexpectedly lowered interest rates to a record low, while the threat of a credit-rating downgrade has dominated the news cycle, inducing much panic within both major parties.
Still, Turnbull’s immediate predicaments are overwhelmingly political, and are much of his own making. In part, this has arisen from an inability to deliver on his early promise. Bold policy ideas on consumption tax, property investment and retirement savings have been floated and abandoned, while the political imperative to satisfy his party’s conservative base has increasingly alienated him from social progressives who had once invested such great hopes in him. Moreover, since September, Turnbull has faced the predictable challenge of dealing with the Abbott legacy. This means spruiking a new vision while attempting to keep Abbott’s conservative disciples onside. One attempt to do so backfired spectacularly when his adopted refrain – ‘Continuity and Change’ – bore a striking resemblance to the campaign slogan of Veep’s Selina Meyer (as series writer Simon Blackwell tweeted, ‘In S4 of Veep we came up with the most meaningless election slogan we could think of. Now adopted by Australian PM’). But Turnbull’s wretched attempts to venerate the Abbott Prime Ministership have only reinforced Labor’s mantra that the new Prime Minister is little more than ‘Abbott in a nicer suit’ (or, indeed, ‘Abbott with elocution’). As Labor has stressed again and again, it was not so much Abbott’s personality (or penchant for eating raw onions) that drove him to record-low approval ratings, but the brutality of his policies. Here the incumbents are especially vulnerable, not least because of Turnbull’s exceptional personal wealth and the ongoing stigma of Abbott’s 2014 budget, the subject of immense political opprobrium for the disproportionate impact of its policies upon the poor. These included university fee deregulation, a fee for doctor visits and the removal of unemployment benefits for under-30s. Today, none of these remains Coalition policy. Yet the classic Labor narrative that the Coalition is governed in its policy direction by the Big End of Town still has potential to cause great damage.
Despite his personal popularity among the electorate, Turnbull provides a perfect target for a Labor Party looking for points of differentiation. For months, it has dedicated much energy to wedging Turnbull, a wealthy moderate treated suspiciously by the vocal conservative base of the coalition, and a noted supporter of three central conservative heresies: same-sex marriage, an Australian republic, and emissions trading (commitment to which directly precipitated his downfall as Opposition Leader in 2009). Labor has campaigned heavily on all three issues. Still, none of these policy divisions will be decisive on July 2. At heart, the election will revolve around traditional battlelines. Labor cries of ‘unfairness’ will be (and have already been) set against Liberal retorts of ‘class warfare’, while the Coalition’s perceived superiority in dealing with the economy and national security will be balanced by Labor’s more generous policies on health and education. In opposition, Labor has neutralised some of these divisions, following the coalition every step of the way in matters of national security (including, most controversially, adopting the coalition policy of forcibly returning boats containing asylum seekers to their place of origin), while making some progress in changing damaging perceptions of its reputation for poor economic management. From the Government benches, Labor attacks of ‘unfairness’ have been neutralised through curbs on tax concessions for wealthy retirees and a targeted crackdown on multinational tax avoidance.
What, then, are the most fundamental policy divisions in this election?
- Housing: Labor has pledged to limit the generous tax concessions available to property investors, with an eye to widening the affordability of houses in one of the world’s most overvalued property markets. Despite flirting with similar policies early in 2016, the Coalition has affirmed its opposition to any changes on this front, arguing that ‘Driving down the value of the most important asset for most Australians is not a strategy for economic growth and enhanced prosperity’.
- Tax cuts: As with any pre-election budget, that of Treasurer Scott Morrison contained a sweetener: a tax cut for small businesses totalling some AU $5.3 billion. It also contained a plan, opposed by Labor, to lower the corporate tax rate from 30% to 25% by 2026 (!). Embarrassingly, though, Turnbull was unable to name the budgetary cost of his tax cut, generating much ridicule from a re-energised opposition.
- Climate change: Labor has recommitted to introducing an emissions trading scheme (ETS) (possibly a dangerous move, given the policy’s proven capacity to destroy leaders) and has pledged to shift energy use to 50% renewables by 2030 (an improbable prospect). These policies predate the Coalition’s shift to Turnbull, a former ETS advocate now forced to defend Abbott’s unpopular ‘Direct Action’ scheme.
- Budgetary deficits: Treasurer Scott Morrison’s budget has effectively rid Australia of its fetish for surpluses, deferring the planned return into the black into the never-never. The impact of falling revenue on the budget’s bottom line – strenuously denied under Abbott – has thus become an accepted fact within political discourse. But it still hurts the Coalition, who for several years now have expended much energy on the accusation that Labor spending, not the Treasury’s empty coffers, was the true origin of its budgetary deficits.
Politically, this election contains some new unknowns. New measures passed late in the Parliament have changed the voting system of the Senate, giving more power to voters to select preferences (previously, preferences could be decided by the parties themselves). The intended outcome of this measure is to reduce the possibility of so-called ‘minor parties’ winning Senate spots with tiny proportions of the vote, effectively in favour of the major parties. Because this election will also involve a full dissolution of both houses (a so-called ‘Double Dissolution’ election, uncommon in Australian history), the possible composition of the Senate remains unclear. A re-elected Coalition might still find it difficult to pass legislation in the face of a Labor-Green Senate majority. But claims by Greens leader Richard Di Natale that members of his party would happily serve in Cabinet alongside Labor was music to the ears of conservatives, who gained much traction from criticising former Labor PM Julia Gillard’s power sharing deal with the far-left party. Under Di Natale’s slick leadership, the Greens have reformulated themselves as a pragmatic left-wing alternative to Labor voters upset by the latter’s policies on issues such as refugees, and have targeted many of Labor’s inner city seats. Under the preferential voting system of Australia’s lower house, Labor will need to rely on Greens voters to win back Government.
In part because of the efforts of Shorten and his Shadow Treasurer Chris Bowen on the economic front, this election has already shown signs of positive change for observers of Australian politics. The 2010 election, called in haste by an astonishingly ill-prepared Julia Gillard against an equally-disorganised Tony Abbott, is today regarded universally as a shambles of a campaign by both parties. Its follow-up in 2013, fought between an insurgent Abbott and a reinstated Kevin Rudd, was not much better. Bad government inevitably followed, and with good reason, some commentators have spoken of a wasted decade under Rudd, Gillard and Abbott.
With some eight weeks still left to run in a campaign that has effectively been running for months already, infinite twists and turns remain. What is certain is that both Labor and the media will elevate Tony Abbott to the centre of the campaign, much to Turnbull’s inevitable frustration. Abbott may well bask in the attention, instrumentalising it in the service of his legacy. These gains will ultimately all be Labor’s. Yet on the other side, Labor will have to contend with the unpopularity of Bill Shorten, the negative perception of the trade unions with which he unrepentantly associates, and, above all, the pungent legacy of the enormous failures and dysfunction of the Rudd-Gillard years (to all of which Shorten himself was central). According to The Guardian Australia, the Coalition is on track for re-election, and most Australians, regardless of how they intend to vote, think the same. But if we have learned nothing else in Australia over the past few years, it is that the state of politics today is utterly unpredictable. Although the electoral parameters look eerily familiar – big spending in the name of better services set against restraint in the name of fiscal rectitude – the outcome is anything but foreseeable. For the moment, the greatest threat to both leaders remains that of hubris.