Chasing the Norm

Australian academic and blogger on politics, international relations, and culture

Tag: Costello

Foiled Logic from Costello

We’ve been subjected to much hyperbole and outrageous overstatements regarding the federal governments home insulation scheme. The press have piled on, enjoying the chance to give Rudd a kicking they’ve been denied over 2 carefully media managed years. The opposition’s (normally sensible) Senator Simon Birmingham on the morning of the release of the Counter-Terrorism White paper declared that instead of terrorism “The greatest threat to the safety of many Australian families over the last 12 months has been the home insulation program”. But this claim by Peter Costello, (though one echoed already around the press/blogs) takes the cake for ludicrousness:

But let us draw an additional lesson from this sorry episode. Both sides of politics are now flirting with the idea that the Commonwealth should take over and run public hospitals.
Bear this in mind. The Federal Government could not run a home insulation program. Do you think it can run every hospital and hospital department in the country?

The logic behind this argument is akin to saying if you have spent your entire life walking around and just once trip and skin your knee, you can no longer claim to be able to walk, let alone run. It’s one thing for libertarians to make such a claim (and Gittin’s is right they’ve attacked the spending but utterly ignored the failure of the private home insulation sector to do a safe/competent job when unregulated) but for a former Treasurer whose government oversaw mis-administration after mis-administration to claim this means all current & future governments should shy from service delivery is utterly laughable.

Did the many failures from 1996-2007 of program implementation and administration mean the Howard Government should have run no programs? Of course not. Costello did not resign when he lost $5 billion in foreign currency swaps, he learnt the specific lessons from it and the RBA shifted policy. I’m all for specific skepticism about governments ability, but there is no logic to claim that one failed scheme (financial incentives for private service deliver) in one specific policy area (environment) means an inability to run a completely different scheme (federal funding/public service delivery) in a completely different area(health). Conservatives and small government advocates do themselves no favours by making such child like use of inductive reasoning (ie that government failed here therefore government will always fail everywhere).

This is especially when we remember that the primary error, the specific cause that lead to the deaths, that lead to the fires, and that lead to people being swindled, were caused by individuals who either were untrained or unscrupulous. The Government’s error was to trust them too much. That didn’t happen in the ACT where higher standards were demanded and hence no foil insulation installed. This was a case of too little regulation*, not too much, but small government advocates (of which Costello was all talk no action) don’t mind twisting evidence to suit their ideology. Shame the media (save Crikey) are so willing to let such fallacies go unchallenged.

*I would be making the same error as I pin on Costello if I were to claim this case is evidence we always need more regulation everywhere, as some surely are taking out of this case. Rather I think it’s real meaning is simply that Garrett wasn’t as across the detail as he should have been, that the environment dept needs an elevation in skills and oversight, and that the fed’s shouldn’t have trusted the States as much as they did. Minor stuff for what was a minor issue.

A Government of One

Always a man apart

Always a man apart

I always enjoy those insider looks at how governments operate. Horse races and polls are one thing, but what truly matters is the individual personalities at play and systems of decision making. This however was not a good way for Lenore Taylor to begins her piece:

THE Prime Minister and his three most senior ministers form a kitchen cabinet that takes the key decisions.

During the Howard years, Australia was run by the 17 or so men and women in the cabinet. Under the Rudd government, it is effectively run by four.

Oh dear. Everyone can understand that a good way to make your point more significant is to make a comparison to show it’s uniqueness. Only in this case Taylor (or a sub-editor looking for a punchy start) is completely and utterly wrong. Weirdly the rest of the article seems to make the exact same point, but in these days where Howard is being exhumed by conservatives everywhere it’s worth re-iterating how wrong it is. Howard’s government, was literally Howard’s Government.

No one who lived & followed politics during the era would record the Howard era as a period of cabinet governance, indeed most people most of the time didn’t even know any ministers names beyond the PM & Treasurer, such was his dominance of the party (a problem they are still grappling with). This was a government that almost never leaked, such was the fear of the PM, and the lack of information flow even at the highest levels. Howard clearly accepted a role for ministerial discussion, but it was to aid his decision making, rather than as the source of decisions.

Howard bypassed the cabinet consistently with senior ministers meetings on key issues, such as the Expenditure Review Committee which set the budget and the new National Security Committee which bypassed cabinet entirely on all foreign policy and security issues. Howard also created the Cabinet Policy Unit (CPU) which ran from inside his office to ensure a lot of matters were left outside cabinet, or pre-organised to ensure speedy passage by cabinet. This is all documented in great detail in the 2006 book on Cabinet Governance “Cabinet government in Australia” by Patrick Weller, which should be in the bookshelves of all political reporters. (You can even get it on Google books. Taylor quotes Weller, but no one whose read the book could write such a sentance.

There is ample documentary evidence to show that though there may have been 17 men and women in the room, but only one vote actually counted. First of course is Costello, who’s memoirs are one unabated howl at being consistently and regularly overruled by the PM on economic and some social issues. Even with issues as big as the GST Costello records that Howard would get cabinet approval and then go make the changes he wanted later in his office. Indeed Costello happily said as much publicly whilst in office

“I can tell you as a Treasurer, there are many occasions when my policy views are not accepted but I always accept a Cabinet decision. There might even be occasions when a Prime Minister’s view is not accepted although it is very rare, if it ever happens

Some of the biggest decisions such as assisting the War on Terror and the Iraq war were made by the PM with cabinet approval a later formality. Indeed in his later years Howard thought nothing of spending $10b on the Murry-Darling without even mentioning it to cabinet.

Likewise there are numerous books out on how Howard governed, including ‘Power without responsibility’ by Anne Tiernan on the unprecedented use of ministerial advisors to short-sheet ministers and center power in the Prime Ministers Office, and ‘No, Prime Minister’ by James Walter and Paul Strangio, on the rise of presidential style leadership, culminating under Howard (though Rudd fits very well too). All are sober academic texts without any agenda but clearly document the centralisation of power within the hands of the Prime Minister. Equally Taylor could have (and should have) read her colleague Paul Kelly’s book March of Patriots which documents Howard’s many presidential style decisions.

Indeed, read on in Taylors article and you see her essential point is that Rudd runs his government much like Howard did. Only slightly more centralised, and with informal groupings made formal. As a nation we are surly the poorer for this, and I suspect given recent events, people insider government are recognizing that too. But this is not Rudd’s creation, and the full scope of changes under Howard will be felt for many years to come. So why start the article with such an utterly false opening that is effectively contradicted throughout the rest of the article? The only people who will read such an article are going to be political followers who would laugh at the absurdity of the line, and probably turn the page. Anyway, the whole thing is worth reading, just ignore the first two lines.

What’s the pay off?

Rudd is a very clever man. Sometimes however he seems to outsmart himself. Take this latest machiavellian ploy to put Costello on the board of the Future Fund:

Govt defends Costello appointment
The Australian government is not about playing politics when it comes to the appointment of former politicians to senior positions, Resources Minister Martin Ferguson says.

Former treasurer Peter Costello is the latest Howard government minister to have been appointed to a senior position by the Rudd government.

The government announced on Sunday that Mr Costello will head the board of the Future Fund from December 18.

But his appointment by the Labor government has sparked criticism from former prime minister Paul Keating, who labelled Mr Costello as “a policy bum of the first order who squandered 11 years of economic opportunity”.

“The prime minister’s goodie two-shoes approach of appointing former opponents of the Labor Party to important public jobs is no substitute for thoughtful and mature reflection as to the public requirement of those positions,” the former prime minister told AAP on Sunday.

The Howard government was rightly criticized for its arrogant politicization of many key postings. Many good institutions were damaged because of the quality and contempt in choice for office holders. To that extent, Rudd’s choice of people such as Robert Hill and Tim Fisher is a welcome return to sense, and decent political advantage. Nelson’s gig in the EU is just a pay off, but there’s enough of those in politics to not make much of a fuss over. But what is Rudd thinking appointing Peter Costello to the Future Fund board ? It’s a bad idea for three reasons:

1. Rudd & Co opposed the FF when it began and still see it as a mistake (or a “solution in search of a problem” as it was infamously dubbed). Given the fleeing of cash from the Govt’s reserves and their desire for big infrastructure developments, they want a FF with as small a media presence as possible. Appointing Costello to the board just gives it a much bigger presence for the media. It becomes a veritable institution, a junior cousin to the Reserve Bank when it comes to financial policy, and all headed by one of their chief economic opponents of the past 15 years. And he’s going to be on it’s board powerfully arguing for an economic vision that not only disagrees with the Govt, but will take pleasure in spiting it.

2. Costello may have signed all sorts of non-disclosure statements, but an ego his size will never prevent him from participating in the debate. As readers of his memoirs will know intimately, politics is personal for Costello. His smirk was never about getting policy up, but putting people down. He may won’t be the chief voice for the FF, but everything he says on economics (such as in his now regular SMH column) will be parsed for commentary on how the FF views Rudd’s government. One word about Telstra shares going down (which hurts the FF slightly) and the story will be ‘Costello slams Rudd for imperiling superannuation/debt/nations future/sunshine and rainbows/’ etc etc. Far from censoring him, it gives Costello a bigger microphone than if he was just another private merchant banker (witness how Bob Carr was regularly and unfairly slammed for his Macquarie Bank links whilst advocating removing tariffs on books)

3. The public isn’t impressed, or even paying attention. It may please the hearts of a few media folk who once had crushes on Costello, but it won’t shift a single vote in the seats Rudd needs to win, and want’s to steal from Turnbull’s enfeebled grasp. Worse, it is just going to put off a lot of labor supporting types, both in the party and out who keep wondering why their side is so weak all the time. There’s nothing wrong with putting your people in key positions. They are your people because they agree with you on the big issues and so can act as substitutes for you. Unless Rudd has figured out a way to clone himself to run every position in Govt, he needs supporters in the key positions to help push his agenda forward. Putting in people like Costello just means you face far far more roadblocks than you should have. And for no political pay off, today’s story isn’t worth anything (esp given the good economic news of this morning).

So its not good politics or economics. Why on earth bother then? I sure hope this wasn’t dangled in front of him to encourage a by-election that the Libs are sure to win in Higgins, which will help Turnbull innumerably. Likewise thank goodness Costello said yes. If he had been offered and said no (and leaked) it would look like the Govt was desperate for his help and had to go begging. Sometimes just playing a straight bat is the most sensible of all politics. Even on those times you pull off the big tricks, the pay off isn’t always worth it.

The Entitlement train is in

Peter Dutton is the Liberal Party federal member for Dickson, and Shadow Minister for Health and Ageing. His seat was re-jigged by the AEC recently and made nominally Labor (as it was Dutton only won it in 2007 by 217 votes). He then ran for pre-selection for the nearby seat of McPherson, and lost to a local candidate. And now he has officially spat the dummy:

LIBERAL frontbencher Peter Dutton is asking the Queensland Liberal National Party to deliver him a seat for which he doesn’t have to fight other preselection candidates.peter-dutton-200x0
This is likely to put heavy pressure on long-term sitting members, Alex Somlyay, the chief Opposition whip, and Peter Slipper, who hold Liberal seats. Both have said they want to stand again and under the Liberal-National merger arrangements, they are guaranteed the right to do so.Mr Dutton, defeated on Saturday for the safe Liberal seat of McPherson, said yesterday he had only ”one shot in the locker for a contested preselection”. His ultimatum puts the party organisation in a bind. Opposition Leader Malcolm Turnbull has said Mr Dutton, who won’t run in his electorate of Dickson again because it is notionally Labor, must have a seat in the House of Representatives.

Mr Dutton, who had stayed silent since his loss, told reporters yesterday he had never intended to ”seek preselection elsewhere in that sort of an arrangement”. He would not run for the new seat of Wright – there already are strong candidates for preselection there. He also ruled out the Senate. Mr Dutton, who reaffirmed he would not stand again in Dickson, which he won from high-profile Labor member Cheryl Kernot in 2001, said the LNP ”has some thinking to do”. He said he would continue to work not just with Mr Turnbull but also with the executive in Queensland. ”I believe I have something to offer the Liberal Party into the future,” he said.

Dutton here is betraying his lineage as part of the Peter Costello school of entitlement politics. The Liberal Party is seen to owe him a seat. Not even a good chance at one (he has the backing of Costello and Turnbull afterall) but an entirely uncontested run in a safe seat. Forget that to be in parliament is supposed to be an honour and an opportunity to serve the Australian public, Dutton feels entitled to be there by virtue of… well something. He won’t even stay and fight in his own seat which he has held for 8 years (meaning far greater name recognition than any other possible candidate-) and which without him guarantees the loss of at least one Liberal seat next election (Fran Bailey’s retirement in McEwan means the same thing). Dutton is seen by some (such as Costello in his memoirs) as being a future leader of the party, a line many in the media have run with. Honestly however, I just don’t see it.

Sure, Dutton is one of the more capable members of the Young turks who came in under Howard, but that isn’t saying much. I got a chance to see up close most of these new Liberals during my time working at Parliament recording the chambers and committees (I’ve since left). MP’s such as Ciobo, Johnson, Laming, Markus, Mirabella, and Smith. Mostly elected in the heady atmosphere of the 2001 election, they reek of a ‘born to rule’ attitude. None appear interested in actual debate. Their speeches, even when delivered to an empty House of Reps spill over chamber (the Committee of the Whole) were simply lists of slogans to attack the Labor party, repetitive figures mirroring the leaders recent talking points, and utter arrogance about their superiority. It bores to watch, and compared to Howard, Abbott or Costello they looked adolescent at best. Howard could be devastating with a good one liner (‘5 minutes of sunshine’, ‘doesn’t have the ticker’ etc), but his speeches were always a guilty pleasure of mine because he actually believed in public debate. He would lay out his views, the reasons for them, and why the other side had the wrong take. He would reason and marshal facts to serve his cause. But far too many of our modern politicians (and I’m including Labor here) see reasoned argument as almost an admission of weakness. Better to just bluster and abuse and hope to get on TV they seem to reason.

Not all of the 2001/04 class are a loss, Greg Hunt has started to impress me, not least with his clear knowledge and interest in Foreign Affairs, but in its period of utter domination during the 2001 & 2004 elections, the Liberal Party abjectly failed to bring in the best possible new candidates (save Malcolm Turnbull who had to fight a unholy branch stacking war in 2004 to get in). Turnbull, now leader, is having to deal with their lack of overall talent, inability to seriously contribute to new policy or political strategies, and now the stink they are beginning to kick up as it dawns that many will not make it through the next election. Expect more stories like Dutton’s in coming months, as many Liberal MP’s begin to decide their best chance of holding on is to publicly abandon their party, whilst still taking its advertising dollars and volunteers. It is not a strategy that usually works (unless you go all the way to become independent), but the media will lap it up. Labor meanwhile should take heed. Given the greater control head office has in the parties’ less-than-democratic selection process, Rudd needs to be ruthless to bring in the very best people, not just ones who are loyal and willing to kick the tories. As JFK said, the time to fix the roof is when it is sunny, not when the rain is already poring in.

Update As if to prove my point that some in the Liberal Party have an entitlement mentality, Costello is going to cost tax payers $500’000 so he can skip out early on his electorate. After having claimed he honours serving in parliament, he has clearly decided that even the 5-12 months till the next election is simply too much. Once more Costello shows his greatest gift is getting media attention, without doing anything worthwhile with it. Though interestingly enough, his former boss John Howard is much more gracious this time around. Incidentally Howard’s also in the news as a rumored NRL chief (could work, though remember the boos he got at the 2007 Grand Final) and as a target of Bob Brown’s (disorientated?) media team on more troops for Afghanistan – It’s 2009 guys, Howard’s no longer in power….) No wonder Labor has gone to ground recently, the rest of parliament is in full circus mode.

The Liberal Party’s Economic Confusion

In my last post I remarked on the Oppositions claim to support big budget cuts, but unwillingness to back a relatively easy example of it. It goes to a much larger problem for the Liberal Party: They don’t know where to stand on economics nor how to describe their position.

The essentials arn’t in doubt, they are for the free market, with a reasonable support for government welfare services chucked in to moderate the harsher aspects of capitalism. But over the last 3 years they have seen massive shifts within this range, and varying and contradictory explanations for these positions.

When the Howard Government left office in 2007, it was championed as a great Pro-Free Market government. It had restored economic liberalism after the savage blow of losing the 1993 Fightback election, and implemented a GST, deregulated many industries, privatised and outsourced significant elements (the famous yellow pages test), and spent 11 years advocating strongly and consistently for free markets. This was seen as one of the great strengths and records of the government. Where articulate critics pointed out they had substituted a lot of populism into this mix (such as Andrew Norton’s essay The Rise of Big Government Conservatism) it was generally ignored. If they hadn’t gone as far down the path as they had liked, this weakness was only a minor issue, one that had helped keep them in power and probably Labors fault in blocking reform in the senate or scaring the people. This wasn’t an extreme or libertarian government in any sense. But it was rhetorically and philosophically clear about the direction it wanted to go, and every step further down that path was seen as a good thing.

Then in the Spring of 2008 the Financial Crisis hit and suddenly economic liberalism was seen to take a body blow. This wasn’t entirely fair, as a particular form of US capitalism, bad oversight and regulations and some distorted government policy caused the crisis which then hit around the world. Now, the former members and defenders of the Howard Government couldn’t get away from the term Neo-Liberalism fast enough. Where they had mocked Rudds 2007 accusations of their free marketer ideals, wondering if he proposed poverty and socialism instead, they now sought to claim he was completely over-exaggerating their support for the ideals. They hadn’t been a free market government, just a pragmatic, cautious one that had only been continuing what Labor had started. What was a small weakness in the Governments economic policy in 2007 was now being held up as its greatest strength in 2009. But loyalty to the old ideas isn’t going away (which is a good thing), but it does mean some serious re-writing of history and rhetorical confusion is going on right now as they attempt to find a new place from which to detail their economic position.

I wrote a while back that the big flaw of Tony Abbott’s book Battlelines (which seems to have sunk without trace) was that this confusion was visible on every page and yet never directly addressed. But theres just as clear an example in Paul Kelly’s new book ‘The March of Patriots’ (2009). Kelly is a conservative if sympathetic writer for both sides, but also one clearly in support of economic liberalisation (As I am too). But this leaves his narrative into contrary directions because of the Liberals recent re-writing (which began to occur whilst interviewing for the book)

‘The 1993 election extinguished more than John Hewson’s dreams – it terminated the neo-liberal political experiment…Hewson’s Fightback! program was the only package resembling neo-liberalism ever presented to the Australian people. Its defeat was a turning point. No Future leader – not Keating, not Howard, not Treasurer Costello – would contemplate the model or its specifics as a package. This was the conclusions from the 1993 election despite occasional polemical claims that Howard as a Prime Minister was actually a neo-liberal – Page 75

Yet just 11 pages later as he details the fall of Hewson he recognises that whilst the man was gone, very little had changed in the party:

It was a view shared across much of the coalition frontbench and it took more shape as the 1993-1996 term evolved. It was the position of Howard, Costello and Dower. Their sentiment was to avoid any over reaction filled with recrimination, to recognise the policy integrity and energy within Fightback, to review policies applying a sharper test of what the people would accept, to return to the political centre but stand by the pro-market economic reform agenda and to avoid any early detailed policy release’ – Page 86-87

Where the Coalition seethed during office that they couldn’t implement all their reforms, out of office they have come to claim this was a deliberate design. Apparently they wanted some of their bills to fail, wanted to lose on workchoices, wanted to be rebuffed by the public on selling Aus Post and others, wanted to have the democrats force them to take food out of a GST, etc etc. In office they would nod and acknowledge yes it was bad economic policy to hand tens of billions over to families on comfortable wages, but that was the price to keep Labor out of office. Now they seem willing to make welfare for the wealthy a core principle of the party.

Labor has responded to the Economic crisis by indulging their desires for government spending. In many ways it seems this has worked very well (we have stayed out of recession, unemployments stayed in reasonable shape), but a reckoning will come and only some seem (Lindsay Tanner) seem interested in talking about it, and then more as an electoral weapon than a shift in policy.

The Liberals on the other hand have got themselves completely tied up in knots. Their baser instinct and education is to return to the proud support for free markets that they enjoyed under the Howard years. To promise to cut spending and demagogue debt. But like a dog beaten too often, when anyone gets close they flinch. When media questions get too hot they jump back. No specifics, no details, and NO NO NO to means tests for government handouts. The only time the Liberal Party has looked at all comfortable in opposition was a few weeks in July 2009 when they had the issue of debt to rally them, and remind them of the good old days. (In fact it reminded them too much of them, repeating old ideas such as a debt truck) , but soon Godwin Grench reared up, Rudd & Swan managed to hold us up out of recession and the Liberals lost their nerve again.

As for Kelly, his book is thus far enjoyable (I’ll do a review when finished early next week) but it feels rather over-written, and with a deliberate eye for the future. He’s trying to make this the essential history of the period (as his End of Certainty became for Hawkies govt). But if he’s willing to uncritically accept this clear re-writing of Liberal views, then it is unlikely to gain as much traction. Nor does it have a cleaver summing up in the way the previous book had with its formulation of an ‘Australian Settlement’

Update: Michelle Grattan is clearly a reader of this blog :p

Trust Me – Tomorrow I’ll start the diet

A nice juxtoposition in this mornings paper:

What they Say:

Hockey Vows to slash $14b in spending

MALCOLM Turnbull will base his push for the prime ministership in next year’s federal election on a promise to axe government spending by billions of dollars a year.

And the Opposition Leader will blame Kevin Rudd’s economic mismanagement for the need to take a razor to spending, proposing cuts that on current levels would be worth at least $14billion a year – the equivalent of 70 per cent of the nation’s annual defence budget.

Mr Hockey refused to nominate which services would face the axe, but said there was a strong argument that government spending as a proportion of GDP should be no more than 24 per cent.

This financial year, spending is worth 28.6 per cent of GDP, with the government’s budget forecasts reducing the level to 28 per cent in 2010-11, 27.1 per cent in 2011-12 and 26.4 per cent in 2012-13.

What they do:

Coalition Votes down Health Means Testing

THE Senate has dealt a $1.9billion blow to Kevin Rudd’s health budget by rejecting plans to means-test taxpayer rebates for private health cover and increase levies on the non-insured.

The Coalition, the Greens, independent Senator Nick Xenophon and Family First senator Steve Fielding combined to defeat the three budget bills, which would have raised health fund premiums for more than two million middle- to higher-income Australians.

Manager of Government Business in the Senate Joe Ludwig appealed to balance-of-power crossbenchers ahead of the vote to pass the savings measure, which the Coalition had long vowed to oppose.

“This is a hard decision and one that was not taken lightly, but it is the right decision for Australia’s long-term economic future,” Senator Ludwig said. But the government offered no compromises, which sealed the package’s fate.

It’s easy to say you will cut immense amounts, but significantly harder to actually do so. In this case the Coalition had a case of spending that could be reduced with the cover of the Labor Government championing the bill, and in line with their major principles of individual responsibility (Private health insurance is a benefit above and beyond the norm, so those who want it should pay for it) and reducing government dependence and spending.

But they have chickened out for short term and almost pointless political benefit. No MP will keep his seat next year because of this vote, but Labor will be able to cut holes in their claims to financial competence by putting up similar bills and watching the Coalition act to keep high spending levels in place.

There’s also an intriguing claim by Hockey that Government spending as a GDP ration should be at 24% (which seems both his comfortable norm and his “emergency maximum level”). Theres no real reason why 24% should be the magic figure. There is the obvious argument that lower is better, but why 24%. It was the most common figure during the last 32 years, but hardly tracks to economic well being. (1)

Personally I think big cuts do need to be made to our welfare levels, but that should be a question of total spending vs need, rather than based around trying to hit supposed magic numbers. As the chart shows, some very successful economy’s have significantly greater Govt spending as a % of GDP, and some have quite a bit less. What’s more important is where and how that is spent, and the capacity of the country to pay for that spending.

When the coalition starts supporting the simple introduction of means-testing welfare and benefits for the middle class we will know they are beginning to be serious about cutting spending (I’m not sure the ALP is either, so we shouldn’t yet take their support for the bill as evidence of it). Until then Hockey is just using bluster and bullshit. But lets leave the final word to his predecessor as Treasurer in the Liberal Party: Peter Costello

don’t think that reducing expenditure to GDP ratios is easy. Every pressure in a democratic system is to increase spending. Resisting calls for increased spending on worthy causes (and all causes are worthy in the eyes of those who want it) is a daily struggle – week in week out, month in month out, year in year out.

(1) Whilst trying to find a good graph illustrating the difference I ran across this 2006 speech by Peter Costello claiming that “In the OECD Australia has the second lowest level of government spending as a share of GDP at 35.7%, lower even than the United States.”. Whilst the 2009-10 budget records a level of Government Payments as % of GDP at 24.2 for that year (Which also matches the figures Hockey cites for current spending at 28%.)

Update: The wise and civil Sinclair Davidson from Catallaxyfiles suggests this may include state spending, or counting the GST as Federal rather than State spending.

Peter Costello

Back in February I made the case that Peter Costello had pretty poor political skills. Which seems an odd thing to say about someone who had such a quick run from election (1990) to deputy leader of their party (1994) to Treasurer of the Country (1996). But for all that Costello has dominated and driven Australian politics over the last 12 years, he was never actually that interested in it. In reading Costello’s (surprisingly) badly written memoirs the picture that emerges is of a lawyer who hated Lefty types and had a bent for economics. Costello was the emblematic technocrat who likes little bits of pieces of policy and the management and control granted by higher office, (not to mention status). In the Howard Government it was ironically the big man with the quick wit who was the boring accountant, whilst the small suburan solicitor crafted the narratives on which all politics is built.

This resistence to politics, especially the big picture, vision stuff is well identified in a quote Costello gave Paul Kelly back in 1998 “I have always decided that, in my life, politics won’t take its totality,” he said. “I have a limited view of politics. There is an awful lot that politics can’t fix.”.
As a young man Costello never got into politics to change the world, instead he seems to have fallen into it through the connections of friends (Michael Kroger & if Bob Ellis is to be believed his future wife also played a major party). Costello describes his first run for office in his Uni’s student unions more a case of sticking it to the silly hippies than any positive ideal. Of course, Student unions promise much and deliver little even in the best hands, but this pattern seemed to foreshadow Costello wherever he went.

What most amazed me about the career of Peter Costello is how little he contributed to the actual debate. Outside his domination of Labors Shadow Treasurers, identifying an area where the public have gone with Costello’s ideas is almost impossible to find. He did not create the support for free-market economics on the right or amongst the general public, and in the 2nd half of the Howard Government squandered that fiscal principle consistently in order to buy votes. In social policy he was often held up as adopting a somewhat more liberal approach than his boss, but his few efforts were token resistance (like wanting to walk across a bridge to show support for reconciliation. Talk about insignificant!).

Most dissapointing of all to those who liked Costello or simply wanted to hear more voices in Australian politics was his 2003 declaration that he was now going to “speak freely”. What did we hear but silence ? If anything the Treasurer was heard less and less. Peter Hartcher’s book ‘To the Bitter end’ details Costello’s 2007 planned press conference should Howard abdicate and make pete PM. Costello’s main themes were as predicable as they were old. Republic, reconciliation and tax reform. Themes Keating had began to urge on the public 20 years before, and which Costello had never seriously engaged during the 11 years he was effectively N#2 in the country (That Mark Vaile resigned with barely anyones notice, whilst Costello who was never even Deputy Prime Minister of this country gets lauded and lauded shows the ridiculousness of the Coalition system). Whilst Howard read and talked history, Costello talked economic stats. His most famous lines such as ‘one for mum, one for dad, and one for the country’ came from a concern about demographic changes and economic impact, rather than any view positive or negative about a larger populated Australia.

This is why i’ve always preferred Abbott to Costello. Abbot’s views were always much further removed from mine than Costello’s, but Abbott’s seem genuine and part of a larger vision of what Australia could be. He was willing to take unpopular stands, even at the risk of the disapproval of his colleagues. Costello always moved in the middle ranks of the herd, all the whilst wondering why it never pushed him to the front. He was the epitany of that famous (mythic?) French Revolution who saw a mob marching by and exclaimed “I must find out where my people are going so I can lead them”.

Costello is a man who seems to have spent 19 years in parliament, without actually valuing politics. He liked management, he liked having power, he liked the status worshiping journalists metered out (though he could be awfully spiteful if criticized). But in terms of a vision of Australia the day after tomorrow, in terms of a narrative that would bind and remake the country, in terms of actual Leadership, he had nothing to offer. To me that seems the great waste of his time. Perhaps all the better he never took the top job, he was not suited for it. Certainly he was lucky that the Coalition gained power after so short a time in Opposition, and he was quick to indicate (on election night no less) that he would not continue in Opposition. Though he does deserve some respect for the way he has valued the institution of Parliament, and desire to stick through the full term he was elected to as the member for Higgens. Indeed the best part of Costello’s speech the other day came from his discussion of the institution of Parliament:

There is no person in this place that is not important. Everybody had something that got them here and got them elected and everybody has a view
that has to be listened to. We are lucky to have a parliament. That is why I very consciously decided after
the election that I would stay in the parliament— because the parliament is an institution that should be
preserved and valued, not just the ministry.

The media attacked Alexander Downer & Vaile & Co who left Parliament immediately after losing government. Yet Costello who stuck around was also attacked by the media as either wasting space or preparing for another challenge to the leadership. The idea of actually being motivated in the slightest by the commitment he made to serve his electorate is utterly foreign to our press gallery.

For that reason, I’ve always had a bit of a soft spot for Costello. As a fellow tall goof, Costello seemed a nice antidote to the relatively humorless Howard and Rudd. He could give a good speech, or make a cutting jibe that the press would repeat for weeks and the public months (roosters anyone?). He is clearly a man for whom family is so very important, and who would put the world on hold to deal with its needs. He even had the constant spur of his brother the Rev. Tim Costello out showing up the Governments mean and tricky ways, and yet never was caught in a public spar with him.

Australian politics is the more boring for his loss, but not necessarily that worse off. If anything it may be nice to bring an end to the theme of journalists for the last 15 years wondering when Costello would lead the party. The floated suggestion of Costello serving as a foreign representative for Australia in some economic role seems to me a good one and well deserving of the man.

I’ve included Costello’s full speech in Parliament on Monday below the fold. It’s worth a read (though loses something in the text. Costello was always much more entertaining in the flesh than on paper)

Read the full article »

All politics is personal

Politico has usually pitched its coverage at a soapy-gossipy level, personality at the expense of ideas and policy, but sometimes it helps illustrate an important point:

Though it’s largely gone unnoticed—or at least as unnoticed as a former president can possibly go—Bill Clinton has jumped headlong into the 2010 election cycle, deploying his political star power to boost some of his family’s most steadfast allies – many of whom stuck their neck out on behalf of his wife’s presidential campaign.

While media attention has focused largely on Clinton’s involvement in Tuesday’s Virginia Democratic gubernatorial primary, where he vigorously campaigned on behalf of former Democratic National Committee Chairman Terry McAuliffe’s unsuccessful bid, the former president’s efforts on behalf of the longtime Clinton family fundraiser were just a small part of a larger, ongoing effort that has involved him in campaigns in at least eight states, in races ranging up and down the ballot from United States Senate to mayor.

Since January, Clinton has held a series of events to benefit his and his wife’s political friends, including Ohio Gov. Ted Strickland, North Carolina Rep. Heath Shuler, North Carolina state Sen. Julia Boseman, New York Sen. Kirsten Gillibrand and Arkansas Attorney General Dustin McDaniel, all of whom face the voters in 2010.

Most commentators in the media obsess over how politicians play in relating back to the general public; that mythic representation of popular will which embraces or rejects politicians every act and for which the Media claim to be the true interpreters of. But important as that is, the really successful politicians, spend most of their time aligning up not just the support of the public, but their political colleagues as well. Clinton’s trails now (though almost endearingly loyal in his repaying of the debt from his wife’s doomed campaign) show his keen recognition that most political success is based upon personal links. The public may put you into the top office, but only your colleagues can put you in a position to make a pitch for public support.

Closer to home, two Liberal party politicians, both regarded as triers and has been’s by their colleagues used similar tactics to take the leadership of their party. In the 1980’s and early 1990’s John Howard was well known for turning up to MP’s functions, or just wandering into Press Gallery offices, late at night, with a bottle of scotch. Though ridiculed for most of his time between his disastrous 1987 run, until his 1995 revival, Howard spent most of that time learning from his mistakes and building personal links within the Liberal party and in the media, to lay the ground for his eventual leadership. Though the media already felt betrayed by Keating, Howard played to the media’s ego, getting to know reporters and their family, have a quiet drink & off the record chat, and of course, always being available for the (paid-to-be-)chattering class.

Likewise, to many in the public, the election of Brendan Nelson in December 2007 was a surprise. Yet as the same gradually noticed over the years, Nelson was one of the hardest working members, in making him always available to other MP’s & Senators for their local electorate officials. As Defence Minister for the Howard Government, his office, if nothing else, carried significant stature, and helped guarantee local press, higher support and imagined significance for the local MP. In return, they eventually came to see (once Costello was out of the picture with his post-election abdication) that Nelson was worth a shot as leader of the party. His reign was predictably short lived. He had neither the image, skills, or timing to re-build the party, and certainly not enough to cause the first defeat of a one-term government since 1932. But his resume will always be topped with the post of Honourable Leader of the Opposition. Sure our media might disparage all who fail to make it to the number one position of Prime minister, but the entire system of government is built upon 300 other major officials who lead and run the government. When it comes to crucial decisions and legislation, Leader of the Opposition is often much closer to number 2, than the Deputy Prime Minister is. And given 298 of those will likely end their career without ever inheriting the Lodge, these positions are worth noting, and honouring.

In comparison, Peter Costello spent the entire 11 years of the government dubbed as the anointed successor for the role of Prime Minister. In this position he seems to have spent his entire time, shuttered away in the office of the treasurer. As Judith Troeth was happy to explain in the Howard Years documentary:

I think he hasn’t taken the opportunity to cultivate anyone but a small band of supporters, ministers and Cabinet ministers and I think perhaps he treated other people with a degree of disdain and I think that led to a degree of unpopularity which would put into doubt his qualities as leader.

Costello was so sure he not only had the talent and skills to be Prime Minister leading a nation of 20 million, he felt justified in ignoring the views and opinion of the 100 individuals within the Liberal Party federal parliamentary party who could make a difference to his actual position within the party ( in fact just changing the mind of 20 of them could have given him leadership of the 20 million of us!). Costello ignored the politics of the personal to his complete detriment. He may never had been able to convince a majority of his party colleagues to support him, but he could have at least changed the power relationship which let Howard walk over him year after year, after year.

Politics is a game of great ideas, historic roles and great challenges. But at the end of the day, it is still, like any other industry, a story of individual connections and loyalties that determine how high and how far each one rises within the industry. Something Bill Clinton, for all his political follies in 2008, hasn’t forgotten.

He aint running

Most aspiring Politicians would maim staffers and passers by to get a regular column in the newspaper. A chance to showcase their ideas, to educate the public to their opponents incompetence, or simply project an image of themselves as a future great thinker and leader. Peter Costello on the other hand seems to be using his chance to road test material for a stand up comedy tour:

I’ve been feeling sorry for Belinda Neal. Neal, you will recall, is the Labor MP who let fly at a waiter when he asked her to move tables at Iguana Joe’s a restaurant/night spot on the NSW Central Coast. “Don’t you know who I am?” she demanded.

Soon all of Australia knew who she was. Kevin Rudd stepped in, reprimanded her and ordered her to undergo anger management counselling.

I’ve never been to this sort of counselling but I can imagine how it operates. A therapist gives you a tricky case and questions you on how to respond. The idea is to keep your anger under control.

Here’s a case study for Neal. You are flying on your private jet when the flight attendant brings you the wrong meal. Do you (a) eat it anyway; (b) point out you ordered something else and ask for an alternative; or (c) shout at the flight attendant and reduce her to tears?

Sure it’s an insiders political joke, but he’s kind of funny; the man always was (though his biography is weirdly lacking in well written lines. They’re in there, but almost all are direct quotes from his hansard performances). But the obvious conclusion that must be drawn from such a whimsical use of the space is that Peter Costello is not, and will never run for the leadership of the Liberal Party. This is just about having fun, either tweaking Turnbull or Labor and rounding off his time in Parliament. He may even be having such a good time, he will nominate for a return act. Perhaps with comedy glasses & a fake nose next time…

News at 9

In other news: Peter Costello is still a smug git.

The future of the Australian Economy

There was much promise when the Rudd government came to power, especially with its slogans such as a ‘Education Revolution’ and efforts to attack the Howard governments lack of spending on education was crimping our economic prowess. With this in mind a fellow aussie blogger Colin Docherty makes a good point about its recent disappointing turn to populism

its interesting that Labor were elected fronting the idea that Australia’s greatest asset was its knowledge, and our potential to put that to use, economically. After criticising the Liberal government over many years about the lack of technical development, its interesting that Labor seemed to have abandoned their plan for a ‘Knowledge Nation‘ (which former leader Kim Beasley ran a failed campaign on), beyond meaningless rhetoric. And now Labor leader Kevin Rudd has taken the cliche political path of sniping at companies partaking in this intellectual revolution. He’s hardly been partisan about this either, with Malcom Turnbull and just about every politician with a microphone near their mouth doing exactly the same.

If a knowledge nation and intellectual revolution was coined as the country’s future path many years ago, why are we selling ourselves short by reverting back to political populism? Instead of wasting time bickering about whether what Pacific Brands did was right, why not instead spend time working on re-training programs,

This reminds me of a quote which I tend to attribute to Paul Keating though can’t re-find my reference: That Australia must become the “brain to Asia’s brawn”. Whilst Australia rode in on the sheep’s back, or manufactured its way to prosperity in the post-war period, it is through the service economy, and designing, marketing and selling products that we are going to be successful in the future. This in many ways was the great failing of the Howard-Costello government. Whilst it could manage the day to day economy, it didn’t have an idea for how Australia would earn a dollar in the future. I had put it down to the general luddite nature of the older members of the government, Howard/Alston and the like which held it back from embracing a digital economy, but reading Peter Costello’s memoirs reveals the malaise was much more wide spread:

‘A particular line of attack on my economic management was that we had failed to encourage dot-com companies, had missed the technology boom and had therefore presided over the collapse in currency. Many critics recommended that Australia quickly establish microchip manufacturing…. The Labor party at this point lacerated the government for the weak exchange rate and its so called reliance on mining. When, some years later, mining became immensely profitable and the high-tech bubble burst, it said we were riding the boom. If Labor had its way we would have got out of mining just when it was about to take off and invested in technology just when it was about to collapse’
– The Costello Memoirs 2008: p 155

In short, Costello seems to argue that it is impossible for the Australian economy to both walk and chew gum. Either mining or IT, not both, and whilst the giddying heights of the IT boom have proven illusionary, to publish an account in 2008 suggesting Australia didn’t need to get on the IT bandwagon (or more accurately get back the bandwagon, as we used to have a world-class industry). Such a tunnel vision government could never summon the interest to push potential new industries, and consequently left Australia out of the great innovative turn of the 21st century*. These captains of capitalism in short managed to prove their own rhetoric about the inability of government to keep up. Shame the opposition had no trouble making the link

Rudd came to power promising a new approach, but thus far it has translated to a few nice rhetorical lines and otherwise cheap economic populism. Rudd would do well to spend less time worrying about the decisions he cant change (like Pacific Brands) and instead helping build for those modernisation steps he can bring about.

* This however is far from the worst luddite sin of the Howard Government. A highlight for me was witnessing Browyn Bishop during a House of Representatives Committee tell a group of public servants that those who had created the MP3 standard were acting as a cartel. I doubt Steve Jobs or anyone who has ever bought an Mp3 player(such as an Ipod) or ripped a CD would agree….

The Great Pretender

Mark Twain once said “History may not repeat, but it does rhyme a lot”, an insight many political watchers must be feeling watching Peter Costello once again destabilize the Liberal Party whilst simultaneously damaging his own standing and reputation. Yet, such an observation seems to fly in the face of the Australian media’s Conventional Wisdom that Costello was the best politician of his generation in his dominance of parliament and policy as Treasurer.

It fits a pattern, Costello was the liberal wunderkid, becoming famous as a young barrister taking on the unions in the Dollar Sweets disupte. After a quick rise in 1994, he wisely (or so it is held) chose only to be Downer’s Deputy, and then again in 1995, took the junior position to John Howard, knowing his standing as next in line was cemented, whatever the outcome of the election.

Victories in 1996 & 1998, along with the introduction of the GST, and slowly improving economic circumstances of Australia (whose rise it must be noted began before the Coalition came to power), and a lack of any strong (or even comfortable) parliamentary performers to challenge him, and Costello was seen as the next PM without a doubt, and a political talent without equal.
Yet from here, our story and the conventional narrative for this great political talent; one that still holds, and sends his troops to the fore breaks down. Costello ended the twentieth century pushing for an Australian Republic and pushing for reconciliation with suggestions of a walk for reconciliation (Costello later backed out; blaming his colleagues).

And, of course having done his loyal time, Costello expected the deal to be honoured, and his ascent up the greasy pole to be complete.

Costello then promised to speak freely, and show the Australian people his full command and leadership, but like most of his promises, it never happened. He stayed fixed almost entirely within his comfortable, unchallenged high ground as treasurer during an economic boom. As we later learned, the great political talent maintained the same aloofness even to his colleagues, the few dozen people who’s votes actually mattered and could have given him the leadership. This great political talent never got any closer to the leadership, year after year. Yet Every 18 months he would step out to have a whinge that the top job was not already his. All without ever being willing to challenge, a pattern he maintained during the coalitions death spiral and Howards late night pre-election meeting on stepping down. Costello of course, the great political talent according to the conventional wisdom, didn’t initiate the conversation, wasn’t in the room that mattered, didn’t have his colleagues loyalty, and ended up going down with the ship, in the same position he had been in 13 years before.

And so, the dawn after his white whale was harpooned and brought down, Costello couldn’t even bring himself to accept the burden of leadership. And so as Nelson and now Turnbull lead the party into oblivion, the great political talent, continues to destabilize, and harm his party. His memoirs passed almost without incident, and the Australian political world, apart from a few rubberneck spectators the man himself, and the same political press corps who created the conventional wisdom of his great talent, has moved on.

For all his talent Costello is a man who (as the Chaser boy’s quipped) wouldn’t even challenge for the leadership when it was already his. This great political talent, never once changed his own parties policy stance on a major issue, shifting from being a rare liberal amongst conservatives, to just another mouthpiece for whatever came out of the PM’s office that day. This great political talent never showed to the public any great vision or inspiration in any field beyond economics, and even there what was new came from Howard, what was competent from Treasury. Having had a better opportunity, promotional base, and luck in national conditions suiting his ministry, Costello still managed to never, ever get any closer to the leadership, than he was on 31 January 1995 when Downer resigned and Costello could have taken the leadership.

Peter Costello is clearly a smart, talented, bloke, but if politics is the art of gaining power or using it for the pursuit of one’s ideas and aims, politics is not one of his skills. He may just well be, the worst political talent in Australian political history. So much opportunity, so much ineptness in actually achieving what he wanted. The media should forget this has been never will be. Good on John Hewson for saying so.

Or, just turn to Paul Keating who nailed the man 15 years ago:

Shaking out the Deadwood.

A few weeks ago I dinged Turnbull for his seeming drift as leader of the party. As far as anyone could see, it was the same party, with the same people in charge from 07, just a different name on the leaders door. The problem here was it was a waste of Turnbull’s skills, artificial to his character & world view, and reflected poorly on his authority within the party. Perhaps however I was too hasty in judgment:

Mr Turnbull is convinced the Liberal Party organisation needs to be revamped, its finances restored and new talent injected wherever possible.

Mr Turnbull said yesterday that the decision of Dr Nelson not to contest the next election was “an opportunity to bring new talent in, and every political party has to renew itself all thetime”.

At the moment, Mr Turnbull, or Liberal forces associated with him, have looked at unseating [Federal Party President] Mr Stockdale next month, supplanting party executive director Brian Loughnane, replacing the Senate leadership team of Nick Minchin and Eric Abetz and, once and for all, heading off Peter Costello.

Long-serving Liberals are critical of Mr Turnbull’s style and claim that “he is trying to turn the Liberal Party into the Turnbull Party”.

“This party was founded by Robert Menzies and any attempts to turn it into a personal fiefdom will be resisted,” one said.

Even the fact that Turnbull is trying to change the leadership council for the party is a good sign. It’s a sign he’s feeling confident (or daring) enough to push for change, and for the party offers its only potential revival. Loughane, Costello, Minchin and Abetz are yesterday’s men, as is Nelson. The sooner they are gone, the better for the party. Such changes not only help their media profile but offer an opportunity for updating (and indeed uniting around) a set of core beliefs and identity that can recruit new members, bind old ones and be sold to the public as a set of values to rival Labors. Turnbull also has finally taken the bull by the horns and declared Costello has had his chance. Everyone who follows politics seriously has known this since the moment Costello turned down the leadership on election night, especially the media swags who keep trying to revive it for good copy. Turnbull’s acknowledgment of the obvious is a fair sign he’s realised Costello wont play nice and simply go away, but has to be driven out like the loser he is (Policy wise Costello was a fine politician, politically he is one of the least successful in 30 years given his obvious talents)

But take again a look at that criticism in the highlighted quotes above – The unnamed critic is decrying the idea of the Liberal Party being a Personal Fiefdom by invoking Robert Menzies ? The man who single handedly ruled the party for 20 years and drastically weakened its chances of success after his retirement through a systematic process of sabotaging potential rivals in a way that would have made Joseph Stalin blush. The liberal party was Menzies personal fiefdom (for good and ill), if Turnbull’s critics want to get at him, they could probably benefit by withholding from comparing him to the revered founding father of their party. Just a thought…