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How the Liberals can survive

April 7th, 2008

As a supporter of political competition, I don’t like the idea that the Liberals/Nationals/Libationals* will remain as irrelevant as they are now. So my Fin column a couple of weeks ago gave them some (unsolicited) advice on how to appeal to a generally social democratic electorate. Feel free to offer your own suggestions.

* This appealing name for a merged party was suggested by commenter Basilisk, who is hereby announced as the winner of the contest I proposed on this topic.

The Liberal Party got a welcome boost a couple of weeks ago, when its most senior officeholder, Brisbane Lord Mayor Campbell Newman, was re-elected, and the party won a majority of wards in the City Council. The result was significant enough for Federal frontbencher Joe Hockey to describe it as an ‘emblematic moment’.

But a closer look at the Queensland local government election results suggests a less hopeful interpretation. Newman ran a presidential-style campaign, with little mention of his Liberal affiliation. And after an expensive campaign on the Gold Coast, the Liberal candidate for mayor got only 26 per cent of the vote, though a preference deal may still get him elected.

There is a more fundamental problem. Newman has marketed himself as “Can-do Campbell� with reference to his ambitious proposals to fix Brisbane’s transport problems with large-scale investment in roads, bridges and tunnels. It remains to be seen how well this program will work. However, a majority of Brisbane residents want these investments and Newman is clearly keen to provide them.

The problem for the Liberals is that at both state and national level voters want the government to provide services like health, education, environmental protection and income support. In his classic work Australia, published in the 1920s, Keith Hancock noted, rather caustically, that Australians view the state as ‘a vast public utility, devoted to the greatest good of the greatest number’. Labor obviously shares this view, and indeed Labor figures have quoted Hancock without any sense of irony.

By contrast, the Liberals are, at best, ambivalent. While they recognise the political imperative to support public services, they cannot bring themselves to like the idea. Ideological supporters of the free market dislike the idea of public provision and funding of services though they have proved unable to come up with workable alternatives.

Meanwhile, many in the party’s small business base view human services like health and education as a cost burden on the goods-producing sector of the economy, the only place they see real economic value being produced.

It has gradually been recognised that such views are politically untenable. In 2004, John Howard noted that ‘There is a desire on the part of the community for an investment in infrastructure and human resources and I think there has been a shift in attitude in the community on this, even among the most ardent economic rationalists.’, and responded with a wide range of expenditure proposals.

But Howard’s conversion was only skin deep. Having long held the view that expenditure projects waste taxpayers money to buy votes, he proceeded to act on it. Money was sprayed at every marginal seat and interest group, with projects designed far more on the basis of political calculation than cost-effectiveness. The billions of dollars spent in once-off discretionary grants were only the tip of the iceberg. The Mersey hospital takeover and the creation of a separate Federal TAFE system stand out as politically-driven boondoggles.

Labor is far from being invulnerable on the question of public services. A decade in which Labor has been dominant in every state and territory has produced plenty of examples of neglect and incompetence. But unless the Liberals can demonstrate genuine commitment to high-quality public services they will remain, at best, the B team, called in only when Labor needs a spell in opposition.

The first step towards a return to relevance would be to disown the culture warriors who provided most of the intellectual support for the failed policies of the Howard era. Their hostility to public sector workers, expressed in their typically vituperative language, undermines any attempt to present the Liberals as genuinely caring about human services.

But more than that, the Liberals need positive proposals that go beyond the point-scoring about policy failures that is an inevitable part of Opposition. Some indications of the way such an approach might be developed were evident in the last years of the Howard government, notably in the area of health policy.

After spending years in a futile attempt to undermine Medicare, Howard (and then health minister Tony Abbott) shifted to something that might be called “Universalism Plus Choice�. The new policy aimed at promoting universal access to bulk billing and public hospitals while also encouraging private health insurance.

Such an approach, adopted more generally could prove appealing to many voters, and allow the Liberals to present themselves as a credible alternative. But it will require more than the cosmetic adjustments in rhetoric we have seen so far.

John Quiggin is an ARC Federation Fellow in Economics and Political Science at the University of Queensland.

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  1. Jill Rush
    April 11th, 2008 at 21:19 | #1

    rog,
    The thought that the Liberals would bring in vouchers will not help them get back into power as it is a right wing belief which is directly aimed at assisting the wealthy get into elite private schools.

    Wizofaus – vouchers may or may not have been used in Sweden but their social system is very different to that existing in Australia. I have not seen an argument for vouchers which will address the inequitable outcomes inherent in such a scheme. I don’t believe that Kings needs another swimming pool but Indigenous children in the NT do need teachers who can impart knowledge and skills. More than vouchers are required and the trouble with a market model is that when there is market failure it is the children who suffer a life long disadvantage. Even if the market is corrected it is too late for those who suffer teh failure.

    Until the Liberals understand the need to have an entire population that is properly educated, rather than the elite they prefer, they will keep losing the education argument.

    During 2007 there were many arguments put up by Liberals as to why the system of funding they introduced was fair. They argued about the teachers unions and how bad it was that they ran the schools. Of course they were playing to fear and ignorance. Their idea of paying teachers to compete against each other instead of raising pay for all and rewarding senior teachers who share skills is something that helped defeat them.

    Liberals need to rethink their ideas on education – something that is extraordinarily difficult for those who have personal experience of elitism combined with a disdain for public education.

  2. Katz
    April 11th, 2008 at 21:33 | #2

    Whatever Katz, point me to any 2008 ALP reforms of significance.

    That’s easy Rog.

    As you have acknowledged, Ratty spent a decade achieving nothing much.

    The Rudd government has therefore simply to tidy up what Howard failed to do. Rudd is therefore simply protecting the achievements of Hawke/Keating and still more profoundly, the achievements of Whitlam.

    Howard spent his entire career trying and failing to unwind Whitlam. He spent half his career failing to bury the legacy of Hawke/Keating.

    Ratty must be a very disappointed man. That disappointment is probably exceeded only by the anger of Liberals who now know for sure that Ratty has driven their party far up a dry gulch.

  3. TerjeP (say tay-a)
    April 12th, 2008 at 04:30 | #3

    Vouchers is something we pretty much already have in Australia in all but name. Public funding mostly follows students all be it via a rather complex interplay between the state and federal tiers of government. Formerlising the existing funding approach with a voucher scheme would merely increase transparency but otherwise it wouldn’t change things a huge amount. As such I think any significant energy expended on advocating vouchers, or energy expended opposing vouchers is probably energy best spent on other things.

  4. John Greenfield
    April 12th, 2008 at 12:18 | #4

    Jill Rush

    My dear I am not a “Liberal” and certainly do not need Reading Comprehension lessons from a Leftist who does not realise that it is those beholden to Leftist theology who are Orwell’s target audience. ;)

    Please avoid this kind of snarky tone in future. It’s explicitly discouraged in the comments policy, which I invite you to read.

  5. Jill Rush
    April 12th, 2008 at 14:26 | #5

    John Greenfield
    I accept that you may not be a Liberal. I didn’t suggest that you were. I was referring back to the topic which is how the Liberals can get back into the game. I may not be able to teach you anything in Reading Comprehension but I respectfully suggest that greater reflection on what others write would help your understanding.

    Your points are not clear and your arguments seem to be based around prejudice not thought.

    It is unclear whether you believe George Orwell shouldn’t be read for his historical perspective because he attended Eton, or because he was a class traitor. George Orwell’s target audience is anyone who is prepared to read the experiences he recounts, or the conclusions he draws from those experiences – in fact he argued very strongly that a writer has a duty to be more than a propagandist. His writing would not be read today if he had written propaganda rather than observation, stories and reflective pieces that speak to today’s audience.

    However his reflection on homelessness is something that modern day Liberals would do well to consider. The Liberal policies which led to massive increases in housing prices, whilst downgrading public housing, has led to a situation where there are far more homeless people than a prosperous land should produce.

    Sir Thomas Playford, a SA Liberal Country Leaguer, made sure that public housing was a cornerstone of his policies through the SA Housing Trust. He had 1000 houses a year built with the establishment of Elizabeth. He also understood that electricity was something that the state needed to provide, as a free market made it into a dog’s breakfast, and thus he created the Electricity Trust of SA. How different to the current NSW privatisation agenda.

    What is needed is a Liberal/National party able to get beyond the stereotypes of left/right and look to the benefit of all as Sir Thomas Playford did. Labelling people as Leftist (bad) will not help the conservative parties change to a social framework supportive of the people who live here or address market failure in the provision of services.

    Prof Q is right; we do need to have a strong Opposition to strengthen our democracy.

  6. rog
    April 12th, 2008 at 19:41 | #6

    Jill,

    Playford was a State leader not Federal – but you are quite right, the situation of homelessness is something the ALP State Govts have failed to properly address (unless matched by considerable contributions to party funds).

  7. Jill Rush
    April 13th, 2008 at 00:41 | #7

    Thanks Rog it is an important point that Sir Thomas Playford was the longest serving Premier in the nation and was leader for longer than any PM – 27 years in total. An abstemious Liberal, a minimally educated, country man who developed industry and created a lot of wealth in SA.

    Whilst housing is a state responsibility the Commonwealth has assumed a role through the State Commonwealth housing agreement which had funding reduced in the Howard years. There are the impacts of negative gearing, high levels of immigration and the first home owners’ schemes which are also direct Commonwealth responsibilities and have worked together to make housing expensive.

    The point I was making is that Liberals have been different in the past and behaved in a pragmatic manner; the current crop could go back to the past to see what has worked well. Unfortunately under John Howard the Liberals went back to the past but delivered the worst aspects, ie a society with winners and losers, housed and homeless as described by George Orwell in “Down and Out in Paris and London”.

  8. Ian Gould
    April 13th, 2008 at 15:53 | #8

    John Greenfield, I assume you know Orwell was a self-described Socialist, a member of the Industrial Labour Party and fought in the Spanish Civil War for the United Popular Marxist Organisation?

    Orwell was at least as critical of the UK Right as he was of the Stalinist left.

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