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ABCEB

September 25th, 2003

I can’t say I’m eager to say anything positive about Kim Beazley after the fiasco of 2001, but I have to agree with what he has to say here and with the unstated message that it’s time to dump Simon Crean as Labor leader. Beazley attacks the last round of tax cuts, endorsed by Crean, and Crean’s promise not to increase the Medicare levy. (I haven’t been able to confirm the existence of this promise, but it’s implied in various press reports)

Having said that, I don’t retract my endorsement of the Caucus decision to reject Beazley’s leadership challenge. Beazley had the chance to put his thoughts into practice in 2001 and he squibbed it. Not only did he not propose an increase in the Medicare levy, he even vetoed any change to the absurd tax subsidy to private health insurance.

After beating off Beazley’s challenge, Crean needed to get off the fence as far as tax and public spending is concerned but he’s failed to do so. As a result, he remains a purely negative figure as far as the Australian public is concerned. In effect, he’s reproduced Beazley’s small target strategy.

So I’ll modify the ABC (Anybody But Crean) view, and say that Labor should go for ABCEB (Anybody But Crean, Except Beazley).

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  1. September 25th, 2003 at 21:06 | #1

    I agree, though I’d rather stick with Crean than promote Latham (whose immediate response to Beazley was to call for another round of tax cuts).

  2. derrida derider
    September 25th, 2003 at 21:43 | #2

    As I’ve noted before, I’m not in favour of a increase in the Medicare levy as it currently exists because it is very badly designed in its details – so much so that I’ve entertained a conspiracy theory that Treasury hated the idea of a hypothecated tax so much it tried to make it a dog’s breakfast. This doesn’t matter much while the rate is low, but the anomalies will begin to hurt if the rate is increased much.

    And it is silly to blame Beazley too much for the small target strategy – it worked like a charm for the other side in 1996. Only a combination of bad luck and some very ugly opportunism by little Johnny made it come unstuck for Beazley.

    Personal likes and dislikes aside, I still reckon Beazley is Labour’s best chance at this stage for knocking over the government.

  3. Jill Rush
    September 25th, 2003 at 22:24 | #3

    Beazley wasn’t subject to bad luck – he was his own worst enemy – every time he opened his mouth on TV I felt like turning the channel over he was so boring – and never a word about the issue of keeping children in detention.

    It was a funny position for one so large to try and make himself a small target.

    I agree with John anyone but Crean or Beazley – there are quite a number of talented people on the Labot frontbench who don’t make you cringe when you see or hear them speak.

    Simon Crean has a sneer as off putting as Peter Costello’s smirk. Kim Beazley is like the souffle which will not rise again. What they need is a woman with the charisma of Pauline with the good sense of Julia Gillard.

  4. Rex
    September 26th, 2003 at 08:55 | #4

    Perhaps it’s just because I’ve been paying extra attention of late, but I agree that there are several other Labour front benchers who are starting to shape up as potential candiates. Here’s my short list:

    Kevin Rudd
    Julia Gillard
    Mark Latham
    Lindsay Tanner

    Now basing my analysis purely on my perception as obtained through Newspaper articles and the TV. I’d say this:

    Kevin Rudd – Is not passionate enough, comes over like a boring accountant or lawyer always wanting to refer everyting back to the rule book. His pre-GW2 attacks on the Government left us cold because all he could do was refer us back to UN resolution 402, subsection 4, paragraph 12, and frankly says ‘frankly’ far to often.

    Julia Gillard – Tough, smart, hard, feisty but has a screechy voice which is harsh to the ear. Without some Margaret Thatcher style voice coaching she won’t get broad support. (Then again Pauline Hanson has a horrible voice so maybe it doesn’t matter that much)

    Mark Latham – Clearly the front runner of the pack. Has been getting great media exposure, and is not afraid of a fight. His high risk strategy means that he could trip up somewhere, but what the hell keep it up Mark, your going fine.

    Lindsay Tanner – Lindsay is the dark horse for mine, his profile is also on the rise with his ‘out of left field’ take on relationships. More importantly though Linday has a calm, almost zen like on air presence, he doesn’t seem to get rattled or raise his voice, and he has a dignity and gravitas somewhat lacking in the others. He could be Labour’s presidential candidate, able to stay above the fray, he just needs to have something more to say on issues affecting Australian’s wealth (which is of course what pricks peoples ears up).

    Rex

  5. William
    September 26th, 2003 at 10:35 | #5

    I think Lindsay Tanner’s a great politician, and am proud to have him as my Federal MP. Apart from stridently defending government ownership of Telstra, and now and then dabbling in men’s issues, I don’t think he’s got much opportunity to shine. Speaking out on topics outside his portfolio risks treading on a comrade’s toes. Apparently his membership of the socialist-left faction prevents him being considered for leader.

    Jenny Macklin did very well as Opp. Health Minister, and has done very well as deputy, why isn’t she a serious candidate for leader?

    And for Rudd’s lawyer/accountant personality, after being a diplomat in Stockholm and Beijing he was a Senior China Consultant with KPMG from 96-98.

  6. Rex
    September 26th, 2003 at 10:55 | #6

    Its a shame that a factional alliegance should be considered such a turn off. MPs should be required to turn in their factional membership when they are appointed to the front bench.

    As for Jenny Macklin, I don’t know, she seems sort of invisible somehow or other.

    Rex

  7. Mork
    September 26th, 2003 at 11:03 | #7

    William – that’s the first time I’ve ever heard someone say that Jenny Macklin had done well as deputy. In fact, that’s probably the first time I’ve heard anyone suggest that she’d done anything.

    My take on the current candidates:

    Latham – unelectable. He clearly has some qualities, but, frankly, he’s a nut. He has some great policy ideas, but doesn’t seem to have very good judgment as to which ideas are good and which are bad – he pursues both with equal vigor. He has very little self-restraint or discipline. And he clearly has an anger management problem. When I played for the Sydney University cricket club, I was told that in the club’s 100-plus year history, only one player had ever been suspended for on-field misbehavior. Guess who.

    Rudd – details man – hasn’t shown any capacity to talk in themes. You can listen to him in an interview and agree with every single thing he has to say, but half an hour later, you can’t remember a single thing he’s said.

    Gillard – not enough evidence to judge capcity for leadership some time down the track. That she’s spoken of at all as a candidate now reflects the desperation of the current situation.

    Tanner – completely hypothetical, because as a member of the left, he would never get the numbers. I just find him, well, a bit weird. I don’t really get where he’s coming from. I think he’s an attractive personality, but what does he stand for other than more hugging?

    Beazley – if you looked at him as a blank slate, he’d clearly head and shoulders above the rest of the pack, including Crean. But there is a history, and it leaves me basically agreeing with John. What has changed since last time? What has he learned? How would he do it differently?

    All this leaves me thinking that if the party really wants to install a leader who will both beat Howard and be good PM, it would get Carr to Canberra now.

  8. September 26th, 2003 at 11:14 | #8

    Does Abbott qualify as “Anybody But Crean, Except Beazley”? More precisely, would an analogue of his? The reason I ask is that on Monday a mate of mine with a long time ALP loyalty rang me to enthuse over Abbott’s criticism of subsidised savings as reported in the Australian. (Of course, Orwell criticised directing the consumption of the poor far earlier and better than any of today’s critics, but they are all thinking along those lines.)

  9. September 26th, 2003 at 11:16 | #9

    WARNING this comment was meant to be on politics but it turned into political economy when I started to break down a stupid article by Greg Hywood. (He relied on John Stone, enough said)

    I have covered the electoral pros and cons in
    Howard’s Unholy Trinity versus Crean’s Dull Duality

    Beazley did have bad luck, he won the 1998 election on two-party preferred votes. And Tampa/911 sank him in 2001 despite the fact that he had a better grasp of civility and security issues than the average ratbag Lefty. But there is scant evidence that a programmatic Labor leader, in the mould of a Whitlam or Keating, would be popular in 2003. VOters have reform fatigue for programs of political economy or political culture.
    There is some evidence of public support for both:
    service increases
    tax cuts

    Seccombe, in His policies are now winning hearts, so why can’t he?
    writes about the paradox of Crean:
    attractive policy
    aversive personality
    The poll evidence bears this out:

    Seventy-seven per cent of respondents to the Herald-ACNielsen poll preferred spending on health and education to tax cuts.

    Hywood, in It’s time to get serious about tax reform attempts to make the case for lower taxes on grounds of fiscal probity and economic productivity, but the evidence he cites shows that the opposite is the case.
    He believes that lower revenue will curtail the govrnments Parkinsons Law disease of spending extra revenue on it’s political pet programs. There is evidence for upward creep of taxes:

    Taxes in 2002-03 were up 8.8 per cent on the previous year – a massive $19 billion. The Commonwealth’s GST take was up just over 8 per cent while personal income tax rose 8.6 per cent. Take the fact that household incomes rose 3.5 per cent, not even half the growth in personal taxes, and it is clear that government is taking an ever-increasing chunk of people’s pay packets…Which is why since 1967 the proportion of the economy made up of taxes has increased from 23 per cent to 31 per cent. This Government has not substantially reversed that trend.

    Yet the evidence he cites points against the operation of Parkinson’s Law. He fails to mention that most federal spending in is on welfare entitlements and human services (health & education). Which of these should be cut? In fact the Howard government shows some fiscal probity. Hywood acknowledges that Howard, like the first Hawke government, has managed to increase taxes, and amortised federal debt, and

    can point to federal expenses falling as a proportion of the total economy.

    The recent experience in the US shows that massive tax cuts can be consistent with discretionary spending splurges (hence deficits).
    Hywood is more concerned with the incidence, rather than the aggregate, of taxes.
    Stamp duty and GST do fall on average households. He seems more exercised by the fact that the Australian tax system still retains some progressivity:

    the 20 per cent of Australians paying the top rate are significantly more heavily taxed.

    He then goes on to make the case for lower taxes on grounds of work incentives and talent attraction.

    The benefits of lower marginal rates are straightforward. Individually, they provide incentive for strong performance in the workplace. Nationally, they help in the international competition for talent.

    He provides no evidence for these statements, and the evidence that I am aware of indicates that higher work out put from high income earners occurred during the nineties, despite high marginal tax rates, as shown by long working hours. The 2000 cut in capital gains tax did not induce a massive inflow of hi-tech capital.

    A better anlysis was given by Colebach. Real tax reform is possible, but it needs real leaders
    On aggregates:

    Australia remained one of the lowest-taxed countries in the West, 25th out of 30 on the OECD charts, with a total tax take (Commonwealth, state and local) of 31.5 per cent of GDP,.

    On incidence:

    Australia still taxes consumer spending lightly. The typical GST in Europe is twice as high as it is here. Of the 29 OECD countries with a GST, 13 have standard rates between 20 and 25 per cent; the median rate is 19 per cent.

    fiscal priorities

    only 20 per cent of Australians wanted the money as tax cuts, whereas 77 per cent would have preferred the money to be spent improving services such as health and education.

    I would say that the case for lowering taxes is political rather than economic, ie shoring up Howard’s aspirational voting base. But even this is dubious if polling attitudes is any truth.
    Forget tax cuts, Coalition voters want health, education

    The Federal Government has failed to win over its own supporters with its budget tax cuts, with a new poll finding two-thirds of Coalition voters would rather see the money spent on improving health and education.

    The governments own supporters are in favour of distributive socialism!
    The hostility to private distribution of community services was more evidenced in the general community:
    Medicare plans fail to woo: poll

    The Federal Government’s Medicare revamp has met a poor reception with voters, with four out of every 10 Australians believing they will be worse off under the new health arrangements.

    Poll results put a spring in Crean’s step
    The polling evidence finds that there is overwhelming disaffection with the Government’s budget strategy, a new AgePoll has found.

    About 77 per cent of those polled said they would prefer the Howard Government to spend more on government services such as health and education instead of giving tax cuts. Only 20 per cent said they would prefer tax cuts.
    This is a blow for both Mr Howard and Mr Costello who said the strategy for this and future budgets was to use extra revenue for tax cuts rather than increased spending on services.
    The ACNielsen AgePoll also found that Australians strongly preferred Labor’s Medicare rescue package rather than the Government’s health plan.

  10. Mork
    September 26th, 2003 at 11:21 | #10

    Jack – you probably know this, but the comparative tax table you cite is misleading because it does not treat compulsory super as a tax. Essentially, we’ve privatized what is a function of government in most of the other countries on that table.

    If you treat super as a tax, we’re actaully fairly heavily taxed compared to the OECD.

  11. William
    September 26th, 2003 at 11:35 | #11

    Mork: Regarding Macklin, she was a good Opp. Health Minister was she not? Perhaps I overstated her record as Deputy, but I seriously think she’d be better than Crean (or Beazley).

    Latham’s out because he’s a maddy/loose cannon, Rudd’s deadly boring, Tanner’s the wrong faction, and discussing Gillard, as you put it so well, ‘reflects the desperation of the current situation’.

    Anyway, talk of appointing Carmen Lawrence to the presidency says more than I can about the dearth of talent in the ALP.

    http://www.crikey.com.au/politics/2003/09/23-0001.html

  12. observa
    September 26th, 2003 at 11:46 | #12

    Funny thing is I can remember when Howard looked as comfortable in the job as Crean and Liberals wanted more presentable figures like Peacock, Hewson and Downer. Personally I thought Crean was at his best when Beazley challenged him. I’d stick with Crean and real policy differentiation if I were Labor.

  13. SP
    September 26th, 2003 at 13:27 | #13

    I agree with observa on this. I think the answer for Labor has to be presenting a good team, working on individual strengths, and trying to prise attention away from the focus on a presidential style of leadership.
    The parliamentary team clearly prefer Crean to Beazley, and one of the fundamental aspects of our system is that the elected MPs get to choose their leader.
    While there is some talk about Crean filling in till after the next election, we have to give some consideration that the Labor MPs actually WANT him as their leader. Like observa I thought that Crean was at his best when challenged by Beazley. Apparently the female MPs particularly preferred him as he relates well to women whereas Beazley was more likely to speak to their male staff. And at least Crean took on the unions and has made necessary internal changes in the ALP.
    I think Macklin is good on policy – but doesn’t like the limelight and for that reason would never want to be leader. Privacy is too important to her – and that doesn’t work for leaders.
    Don’t get me wrong, Crean has made some appalling mistakes, but it must be an awful job, how many goes did Howard have before he became acceptable.
    Actually I am getting sick of the media focus on the ALP leadership and I am starting to get annoyed that they are trying so hard to get rid of Crean. You have to have a thick skin in politics and if he toughs this out – good on him.
    My other thought would be Bob McMullan, but again I think it is a factional problem.

  14. derrida derider
    September 26th, 2003 at 14:10 | #14

    The best performer in the Federal ALP is in the wrong house – ask any public servant who’s faced Senate Estimates.

    Faulkner should have moved to the reps years ago. Yeah, he’s also in the wrong faction but maybe the hard men in caucus are getting so desperate to get their bums in the white limos that they’ll overlook it.

    Macklin would quickly be caught out because she can’t master a brief. McMullan’s a lovely fellow, fairly smart and very hard-working; unfortunately he’s got the charisma of a dead fish. Any of them, though, would have more chance of beating Howard than Crean.

  15. SP
    September 26th, 2003 at 14:22 | #15

    Yeah, Faulkner would be good, but it would also be a great loss if he left the Senate. He obviously doesn’t want the leadership otherwise he would have done something about it.
    Even more than charisma you have to really WANT to be PM – Howard has clearly demonstrated that!

  16. September 26th, 2003 at 17:55 | #16

    Re Faulkner and factions. Word is some unlikely people are going to come out and support him in the preselection for the Senate…

  17. September 26th, 2003 at 17:57 | #17

    “talk of appointing Carmen Lawrence to the presidency”

    You mean talk of electing Carmen Lawrence to the presidency. This will show just how out of touch the heavyweights are with the rank and file.

  18. Mork
    September 26th, 2003 at 19:05 | #18

    Either way, it’s a horrible thought.

  19. Sigmund
    October 9th, 2003 at 15:22 | #19

    Yes, “Crean was at his best when Beazley challenged him”. Which is to say, the only time the man has displayed any observable passion was when his own job was on the line. And what does that tell you about him?

    Simon Crean is sadly unable to articulate a vision that might knit together Labor’s multifarious policies into a coherent message capable of winning enough support to get over the line. If, God forbid, he stays on as leader, it won’t matter what policies he espouses, because nobody will be listening. If the Labor caucus wants him to stay on, it bespeaks a worrying detachment from reality.

    I’d be cautious about anointing Latham, Gillard et al. at this stage – competence in a shadow or even a real portfolio is not enough, witness the fact that Crean himself was a competent minister but these days (to mix metaphors) can’t take a trick, despite being handed any number of free kicks by the Coalition’s stumblebums.

    Leadership may be slippery to define, but you know when a politician’s got it – and when they haven’t. Hawke, Keating, Carr and, I would submit, Beazley have it. Crean and Macklin just as obviously haven’t, and never will.

    Carr is focused, articulate, unflappable, and has the useful quality of Teflon coating. Beazley not only has unmatched ministerial credentials but on his day is a passionate and convincing communicator, witness the TV debates with Howard. With either at the helm Labor can win, whereas with Crean, the odds are dismal.

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