John Menadue. Is the public sick of reform?

The business sector and the media have each been asking this question. It is not surprising perhaps in view of Tony Abbott’s plummeting approval rating and the election results in Victoria, Queensland and South Australia.

In the Australian Financial Review on 2 February 2015, Laura Tingle said ‘The biggest national question to flow from Queensland’s historic 2015 election result is not whether the Prime Minister will survive, but whether, after 30 years, voters have had enough of political rhetoric about reform and change and whether both sides of politics back away from ambitious reform as a result.’

Perhaps election day in Queensland was ‘a disappointing day’ for the Business Council of Australia and the ‘reforms’ its rent seeking constituency would like, more privatisation.

My contention is that the public will respond to well developed and explained policies for change. But that was not what we are being presented with. What we have been hearing about for many months is a burnt out ideological agenda from the Government and the BCA that markets are always right and that privatisation is the way of the future. Surely privatisation reached its high water mark years ago and it has been ebbing ever since.

Queenslanders have particularly shown that asset sales are now off the agenda. Even the Liberal National Party in Queensland has now disowned asset sales.  It should have learned a lesson from former Queensland Premier, Anna Bligh, who decided that her Labor Government would sell Queensland Rail. She was defeated after a long period of Labor Governments, but the sale of Queensland Rail really soured the public attitude to her government.

In all these cases of privatisation, there is a strong public perception that wealthy financial advisers, underwriters and brokers have drained hundreds of millions of dollars in fees at the expense of the public.

It will be interesting to see what the NSW Premier, Mike Baird now does about his proposal to lease the state-owned transmission company Transgrid and over 50% of distribution businesses Ausgrid and Endeavour Energy for 99 years to the private sector. Recent polling by Reach Tel for Stop the Selloff Campaign reveals that 67% of people in Victoria and 74% of people in SA believe that they were worse off with privatised electricity networks.

The question will also be asked in the NSW election in eight weeks’ time that with the interest rate at record levels, the most prudent thing to do would be to borrow rather than sell valuable assets to build new infrastructure. The 10 year bond rate is the lowest in living memory at 2.25%. We could lock in a record low interest borrowing for 10 years. With our inflation rate at about the same as the bond rate the real interest rate would be close to zero.

At the national level Tony Abbott has not put forward well-developed and explained policies. At the last election, he had a lot of one-liners but very little developed thought on policy. Tony Abbott didn’t win the last election with his so-called ‘policies’ he won because of the shambles of the Rudd/Gillard era.

Tony Abbott’s wrecking ball approach which was so successful in opposition is not working in government. His policies have not been carefully developed and explained. In his National Press Club speech he spent a large amount of time trying to sheet home responsibility to the Rudd and Gillard governments rather than defend his own record and explaining his vision for the future.

The public is clearly not impressed with policies like asset sales and taxes that benefit big business and the wealthy, but leave the public the loser. That is why Joe Hockey’s budget is in ruins. It was regarded as unfair. No attempt was made to wind back the benefits of the generous superannuation concessions, concessions on the capital gains tax, negative gearing, salary packaging and the very widespread failure of wealthy companies, many of them international, to pay tax – Apple, Google, Glencorp, Westfield, News Corp and Ikea.

I am confident that the public will respond to well-developed policies that are efficient and fair.

Tony Abbott has never developed a credible narrative. He has not thought much beyond one-liners. He has done very little in credible reform and the bits and pieces he talks about don’t fit into a coherent story.

Bill Shorten speaks of 2015 as being the year of ideas.  There’s a lot of policy development to do, but will he go the same way as Tony Abbott and attempt to gain office by default.

The public is certainly sick of the type of ‘reform’ that we are being offered by the government and its friends in big business. But I am confident that the community, if treated respectfully, will respond to relevant policies that are well developed, tested, fair and properly explained. We have had very little of that in the last 18 months.

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9 Responses to John Menadue. Is the public sick of reform?

  1. Jeffrey Braithwaite says:

    What we’ve been served up, particularly in the last 16 months, is not reform at all. It’s ideology, masquerading as progress. Real reform requires deep policy analysis, major discourse between stakeholders, and considerable community involvement.

  2. Willy Bach says:

    Thanks for some very sensible arguments. We should characterise LNP and much of ALP ‘reform’ as neoliberal deform, something that results in less-good outcomes for the broad community. As you say, “In all these cases of privatisation, there is a strong public perception that wealthy financial advisers, underwriters and brokers have drained hundreds of millions of dollars in fees at the expense of the public.” You describe these beneficiaries as a “rent seeking constituency”, which also describes the corrupt elites of African dictatorships, especially where the impoverished nation is found to have attractive resources to be plundered.

    No amount of threats from Campbell Newman or tricky rhetoric from Joe Hockey will change my mind. The sums don’t add up, the assets are often sold in a disadvantageous market to opportunist buyers that are heavily indebted and chafing at the bit to achieve profits. I think we are also going to find this in the case of Medibank Private, although it is currently hailed as a success. All the same, a formally well-functioning business no longer contributes to the common good. Can these deformers prove with sound evidence that privatisation is an improvement? In most instances they cannot.

    If we are supposed to believe that conservatives are better economic managers, we would first need to be consulted and convinced that asset sales are indeed the best option of at least three possibilities that had been expertly evaluated. We would at least need to examine the business case. There did not seem to be a very sound one for the Clem7 tunnel in Brisbane or any business case at all for the East-West Link in Melbourne.

    So, yes, long may voters maintain their skepticism. May we be guarded in what we believe; and may we maintain a healthy distance between what is really reform in the collective best interests of us all and this shonky snake oil which should be called deform.

  3. Don Aitkin says:

    John, what do you think such policies would be, in the context of falling government revenue, and a continuing excess of expenditure over revenue?

    • John Menadue says:

      Don
      In earlier blogs I have mentioned the importance of changes on the revenue side eg Limit superannuation concessions,capital gains taxes,negative gearing,salary packaging,carbon tax,mining tax and massive tax avoidance by such companies as Google,Apple,News Corp, Glencore and Westfields. Sorry for the delay in responding but wedding and birthday intervened!

  4. Michael Keating says:

    I agree the public may well be sick of the Government’s meager attempts at reform. Their agenda seems to be dictated by the Business Council with its self-interested focus on lower costs by reducing wages, and lower taxes, starting with no carbon tax, no mining tax on super profits, and lower company tax. A real reform agenda would start by considering what sort of society we want and how we are going to achieve it, including how we can improve efficiency and then collectively fund the required expenditures.

  5. Brian Coyne says:

    The Liberal Leadership spill is on next Tuesday. Here’s the coverage in the SMH:
    http://www.smh.com.au/federal-politics/the-pulse-live/politics-live-tony-abbotts-leadership-in-crisis–february-6-2015-20150206-137ks2.html

    The night the Queensland election result became clear, I predicted a week — or, at the most, a month. It seems I was pretty close to the mark.

    Mind you I wouldn’t be at all surprised to see Abbott survive this one. There are few quality people left in the Liberal Party today. None of them believe anything other than that they’re the most intelligent beings, and best managers of money, that God ever breathed life into. The outcome will not be determined by any evaluation of “what is good for the country” but by individual assessments of however many turn up for the meeting trying to divine the future of their own personal survival.

    None of this of course is any good for the government and well-being of our nation, BUT IT IS SURE GOING TO BE AS ENTERTAINING AS HELL — or if you were privileged to be an onlooker at the Last Judgement. What the Labor Party needs, and quite possibly the entire country, is for Abbott to actually survive this so he can be tossed out more decisively at the next election.

    As I’ve written in the past, I basically blame all the instability in Australian politics of the last few years to Abbott and the Liberal’s decision to dump Malcolm Turnbull in favour of Abbott. And I mean a lot of the instability on the Labor side of politics as well. I’ve never really believed that the Labor Party dumped Rudd because of his personal failings. I believe they dumped him because they were running petrified of Abbott’s ability to stir up the yobbo vote in Australia. They thought a woman, and particularly one like Julia Gillard, would be a far better foil for Abbott than Rudd was. They were nearly proved right bu in the long run not. They had reason to be afraid but, in the long, long term, the influence of ‘Captain Catholic’ on Australian politics and this nation has been a disaster.

    In my heart-of-hearts, I do hope he survives this vote so that the chaos continues and the electorate as a whole can deal with him properly at the next Federal election. The problem is not just confined to Tony Abbott. Pyne, Hockey, Bishop, Pyne, Morrison, Dutton, Andrews, and I could go on…; almost the entire tribe of them are “main chancers”, narcissists, who believe in nothing other than their own individual selves. The entire pack of them are not be trusted. If Malcolm Turnbull “gets up” at the meeting next Tuesday and is elected leader, the real problem is the total lack of talent behind him on th front bench of the conservative side of politics. The chaos will continue whoever “wins” next Tuesday — basically because of the lack of depth anywhere on the conservative side of politics.

  6. Don Aitkin says:

    Why is my earlier comment still awaiting moderation, though printed?

  7. Brian Coyne says:

    A further comment now that we know the result of the spill: Abbott survives despite a nearly 40% vote of no-confidence by his party.

    It is the almost total absence of ‘talent’ anywhere in the party, or on the front bench. This has been the best result for Malcolm Turnbull — one of the few who does have a bit of ‘talent’ and a few principles. Had the spill motion succeeded and he put himself forward and become leader, because of the lack of talent he would have to choose from he’d probably only be Prime Minister for the rest of this term of government — what is it? Another 18 months. It’s not just the present leader that is the problem. It is the entire conservative side of politics. They don’t believe in anything other than a self-belief that they are the best thing God ever breathed life into. They are incapable of looking at themselves through the eyes of the people who have to vote for them.

    Mind you the Labor Party has much the same problem as the conservatives — a general lack of talent — although my assessment is that there are a few more with principles there than elsewhere though it is marginal. The whole situation is indicative of a major shift that’s gone on in politics generally in recent decades — the move of a specific sub-class of what might be dubbed “professional or career politicians” into our parliaments. Politics is increasingly seen as a place for personal advancement and it has lost a sense of noblesse oblige — the sense of entering public life out of a sense of “giving back to society” for the benefits society has given to oneself, one’s family or one’s class.

    Turnbull, if he would like to be genuinely remembered as an admired leader in Australian politics ought “sit back” wait for Abbott to completely screw everything up, let Labor return, and spend the time trying to re-build the Liberal Party with a few people of principle rather than a flock of dopes who all see themselves as clever but essentially they are not and are there mainly to advance themselves financially, or socially, in life.

    A measure of Turnbull’s talent is that he has played the events of recently days superbly well. It’s also a measure of his talent that in a very general sense the rest of the Liberals hate his guts — probably because he tends to ‘show them up’ for what they are.

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