Assuming that he was pursuing a consistent plan at all, Peter Costello’s months of coyness about possible leadership aspirations now appear to have been designed to ensure a big splash for his memoirs. Presumably, his departure from Parliament won’t be long delayed and (while you should never say never) it seems that his political career is over.

Unlike with Howard, I’ve never really rated Costello. Undoubtedly he’s a sharp debater and has the good lawyer’s capacity to get on top of a brief, but in his twelve years or so as Treasurer, I didn’t see anything to suggest that he really understood economics or thought much about economic policy. His near-silence since losing office, despite repeated Labor attacks on his legacy seems to me to confirm this. Without the backup of Treasury and staffers, he doesn’t seem able to mount an effective argument (or maybe he just can’t be bothered). Perhaps his book will tell a different story though – I certainly expect it to sell pretty well given the promised bagging of so many colleagues.

The outcome of the Western Australian election remains undecided. Labor could hold on to power either by winning enough seats to govern with the support of independents or by making a deal with the Nationals. Conversely, the Libs need to win the seats in which they are currently ahead, and then cut a deal with the Nationals.

Apart from being a reminder of the folly of snap elections designed to capitalize on transitory political circumstances, this close result reminds me of something I’ve observed over time. Whichever of these two even-money chances is realised, we’ll come to think of it as inevitable. Consider for example Bush’s win in 2000, Howard’s in 1998 or Hawke’s in 1990. In each case, the vagaries of the electoral system turned a loss (admittedly narrow) on the votes into a winning outcome.

Yet with the possible exception of Bush, this fact is forgotten when we come to assess the electoral appeal of the winners and even more of the losers. Peacock, Beazley and Gore could all have reached the top if a few electoral dice had fallen differently. But they go down in history as failures while Bush’s two terms and Howard and Hawke’s four mark them as winners, at least until their luck ran out.

One thing I’ve learned in life, though not always applied, is that if you ignore a job long enough, it often goes away. I was going to write a post excoriating Maurice Iemma and Michael Costa for their handling of the electricity privatisation issue, but it doesn’t matter much now (retail privatisation may still go ahead, but that’s not such a big deal either way). The earlier departure of deputy premier John Watkins is more of a loss, though no real surprise.

Labor now has a chance to salvage a government that looked to be utterly doomed. It’s a long shot, but the NSW Liberals have a long record of snatching defeat from the jaws of victory, so who knows.

A week ago my Fin column (over the fold) predicted a double dissolution over legislation to establish an emissions trading scheme. The rejection of the government’s changes to luxury car tax shortens the odds considerably. The government made a number of compromises to satisfy the Greens and Nick Xenophon that highly fuel-efficient vehicles would be excluded, but that only made it harder (in the end, impossible) to deal with Steve Fielding of Family First. The same problems will emerge, in spades, with an emissions trading scheme.

It seems likely that lots of legislation will be rejected between now and the time an ETS becomes a trigger,. If the government can hold its nerve, and its popularity, a double dissolution will look very attractive by then.

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After trying out three alternatives, the WA Liberals are back to Colin Barnett as leader, and, amazingly, he still hasn’t given up on the idea of a canal from the Kimberley to Perth.

Longtime readers will remember that we had loads of fun with this and similar crazy ideas last time around.

According to my quick calculations, broadly consistent with a study commissioned after the election, it could well be cheaper to supply Perth with water by towing icebergs from Antarctica.

I blush to admit it, but according to his Wikipedia article, Barnett is a fellow economist. (It gets worse – Buswell also has a BEc).

The euphoric honeymoon period for the Rudd government may be behind us, but we still get regular reminders that we made the right choice as a nation last November. Today’s news includes two such reminders
* The end of the brutal policy of mandatory detention, introduced by the Hawke-Keating government and hardened repeatedly by the Howard government (notable participants who deserve continued obloquy include Philip Ruddock, Peter Reith and Amanda Vanstone)
* The intervention by Peter Garrett to protect remaining cassowary habitat near Mission Beach

The Opposition’s response on mandatory detention, as on almost every issue that has come up for debate since the election, is a reminder that they need a long spell out of government. On current performances, I’d say that they won’t be a credible alternative until everyone who held office under Howard has left the political scene.

That’s the claim made in today’s Oz, quoting the NT Council of Social Service president Barry Hansen. The NT gets very high levels of Commonwealth Grant funding on the basis of a needs-based formula which is heavily influenced by the large proportion of indigenous people, living in remote areas that are costly to service. According to Hansen, the funding is largely spent on providing services to the wealthy (mostly white) suburbs of Darwin.

Mr Hansen pointed to the latest Commonwealth Grants Commission State Finance Inquiry working paper that showed the commission had assessed the Northern Territory Government’s expected per capita expenditure on indigenous services to be close to $218 million in 2006-07. The working paper’s assessment showed that the Northern Territory Government, whose grants from the commonwealth are not tied to the spending areas for which it is allocated, only spent $110 million.

I haven’t studied the NT accounts in detail, and I’ve only visited a few times, but I must say this is consistent with my understanding.

As an illustration, it’s worth comparing the Parliament building for the NT (pop 217 000) with the building in which the Legislative Assembly for the ACT (pop 339 000) which received self-government about the same time . The NT assembly is an imposing building. I don’t have a cost figure, but obviously it would not have been cheap. The ACT assembly meets in a low-rise office building, at least 40 years old and refurbished 15 years ago. (pics to come) It’s hard to see how the NT could have afforded its building on the basis of the local tax base, assuming that any compensation for the high cost of remote services was spent where it should have been. And what’s true of the buildings is true more generally of the capitals. While the ACT, and particularly its city centre, has got noticeably shabbier since the end of direct Commonwealth control and funding, Darwin looks like a place that is getting plenty of public expenditure.

Of course, impressions can be wrong and bloggers like Ken Parish at Club Troppo are much better-informed on the NT than I am. So I’ll follow this story with interest.

Greg Sheridan’s panegyric to Alexander Downer includes the following aside,

Australian foreign policy history, and Australian history generally, is written overwhelmingly by people who are institutionally sympathetic to the Labor Party. In fact they are generally quite a fair bit to the Left of the Labor Party. And one of Labor’s great virtues is its creation and nurturing of its own legends. Thus, at the end of 1972, the Whitlam government extended official diplomatic recognition to China.

Several Western countries had done this already and by the end of 1973 the whole world, more or less, had recognised China. Thus Australian recognition was as near inevitable as anything could possibly be in history. No matter who was in power in Canberra in 1973, it would have happened. Yet the Labor school of history has elevated this to an act of mythical heroism and far-sighted statesmanship by Gough Whitlam.

Sheridan is either playing on his readers’ ignorance or displaying his own here. He asserts that the inevitability of recognising China was obvious to anyone at the time. In fact, when Whitlam (then Opposition leader) visited China in 1972, he was vigorously attacked by the conservative press (a group the Oz was to join a couple of years later) and the conservative parties. Then PM McMahon said of Whitlam “And, of course, Zhou Enlai played Mr Whitlam like a fisherman plays a trout.” It was typical of the McMahon era that it came out shortly afterward that Kissinger had been secretly visiting China at the same time, laying the groundwork for Nixon’s famous trip. Even so, the McMahon government didn’t recognise China, leaving this to Whitlam.

To set the record straight for Sheridan, Whitlam’s willingess to visit China in 1972 was indeed a piece of far-sighted statesmanship, and took some political courage. By the time Whitlam won office at the end of the year, it was indeed obvious that recognition was inevitable, but even so, there were plenty of people, then as now, who ignored the obvious.