The Great Crash, 30 Years On


There is a choice for Labor.

There is the cynical view that it can simply sit and wait. Or it can put forward an alternative – not simply for the purposes of an election campaign, but as a vision for Australian society over the next decade and beyond that it would aim for in government. This kind of approach might also be good politics.

It is true that many members of the community are – quite sensibly – concerned about government decisions that affect their financial position, but they do have other concerns, and they may well respond to any political party that shows an awareness of those concerns.

Thanks to Fiona Katauskas

Thanks to Fiona Katauskas

One problem for Labor – probably more so than for the Liberals – is that many of its parliamentary members now have very little in common with the bulk of Australian society. Most members of parliament have never been ordinary members of the community, but the Federal Caucus is a strikingly unrepresentative body. With some exceptions, it is composed of men and women whose only previous careers were as trade union officials, party officers or political staffers.

One reason for this is that it is really only from these kinds of positions that it is possible to build up the numbers to gain preselection for a parliamentary seat. In recent years this has become more common in Liberal ranks, but there is still a broader cross-section of backgrounds and occupations than on the Labor side. This is not really an electoral issue in itself but it has had two important consequences for Labor.

One has been to affect the quality of candidates for leadership and front-bench positions. The second has been to isolate the party from many community concerns because its parliamentary representatives simply have no idea how most Australians live their day-to-day lives. The complexion of the Caucus also raises the question of what would be the capacity of some ministers in a future Labor government. How much genuine talent can there be in such a small gene pool?

It is also important, although increasingly difficult, for politicians to realise that the interest groups that flood them with material and representations every day do not speak for the general community. Sometimes what these groups want may also be in the public interest. But that can never be assumed. Mining organisations and environmental groups are, for example, two of those interest groups and ones that are often putting opposing cases.

But it is hardly surprising that the miners tend to underestimate any damage to the environment and that the environmentalists tend to underestimate the economic benefits of mining operations. This is the point of interest groups – they only see one side of the argument. A government decision needs to balance these factors in the long-term interests of society.

One other confusion about community concerns should be mentioned. Whenever polling is done on what issues are seen as important by the electorate, general notions, such as health and education, are frequently mentioned. There is little evidence, however, that these vague expressions translate into shifts of votes.

Naturally health care, for example, is important to everyone, but there seems to be recognition in the community that it is a large item in the Federal budget and that the two major parties are not suggesting any reduction in those funds. There has been a tendency on the Labor side to simply assume that if enough references are made during the course of an election campaign to health and education, this will somehow tap into the sentiments that are reflected in the polls. Certainly that strategy has had no success over the last decade.

What Labor needs to do is think about the big issues that will confront all Australian governments over the next 20 years, and develop some detailed options – they do not have to be single, dogmatic solutions – for dealing with these problems. Inevitably this would provoke considerable public discussion and there would be many people who would disagree with some or all of the options suggested. But this does not mean that they would not have some respect for this kind of approach.

There are a range of issues that need to be taken up but they would certainly include the following:

¢ Simplification of the tax system, which has become impossibly complicated. One possible but dramatic option is a flat rate of taxation combined with offsetting benefits;

¢ Containing the sharply rising costs of health for an ageing population, although this would probably require reducing the existing role of doctors and pharmacists, both of whom are extremely powerful interest groups;

¢ The right level of immigration for a country that has labour shortages in some sectors but a number of large cities, most particularly Sydney, where even the existing population has produced acute problems of air pollution, water shortages, traffic congestion and urban crime;

¢ Improved provision of child care for working women, most particularly for children under the age of two where the cost of care has limited its availability;

¢ The adequacy of existing superannuation arrangements for a population that is living longer and retiring earlier. An associated problem is that the legislation governing superannuation requires drastic surgery, given that at last count it numbered almost 28,000 pages;

¢ Whether there ought to be decriminalisation for adult use of some currently illegal drugs that have a widespread use in the community and effectively consume the largest single component of the resources devoted to law enforcement. This is, in some ways, an issue for State governments under their criminal laws but the Commonwealth has a major role in this area because of its regulation of imports;

¢ The use of alternative energy sources – but most particularly nuclear power – once it is accepted that the reserves of coal and oil are finite and have significant environmental consequences, especially in the form of petrol emissions;

¢ The form of government to be adopted if the British monarch is discarded as head of state. This is hardly something, of course, that affects people in their day-to-day lives, but it ought to be the subject of a proper public debate, even if this proved impossible on the last occasion;

¢ The extent of economic regulation that is workable in such sectors as the media, airlines and communications. There is a real question as to what is the benefit to the general community – as opposed to the commercial operators – of highly detailed government supervision of these areas of the economy;

¢ Whether there should be changes to the current laws on the funding of political parties and their election campaigns, to limit the size of donations. There has been an attempt to do this in the United States, although not very successfully. If campaign contributions were limited, the real effect would be on the area of single greatest expenditure – television advertising – which seems to contribute little to the public debate on political questions.

These are all, of course, subjects of enquiry for the Liberal Party as well as Labor, given that the Liberals will presumably be in power for some of the next 20 years – and certainly for at least the next several years.

It has already been suggested that neither party is likely to get a great deal of assistance in this exercise from the Canberra bureaucracy. The long-serving public servants of the Menzies era – some of whom remained to confront the Whitlam Government – made mistakes, but many of them had a strong view about the future of Australia in the postwar years, and were prepared to fight their ministers and anyone else in defence of those views.

The modern mandarin is more likely to spend much of his or her time in day-to-day crisis management, keen to move on in a few years to an even higher-paying position with private sector bodies like Telstra or Macquarie Bank. There is not much incentive to think beyond the next election to the problems of the nation in 10 or 20 years time.

Nor are the party offices likely to be a source of planning for the future. They are inevitably focused on the next election and on policies that will produce votes in the short term, whatever their merits might be otherwise.

The importance of long-term thinking may yet be the most useful legacy of the Whitlam period. This was what happened on the Labor side in the late 1960s and early 1970s. The government that came to office in December 1972 never had the time – or, it must be said, the capacity – to make use of the results of that work in opposition. There were some exceptions, of which Medibank was the most significant.

But even those members of the electorate who did not vote for Labor in 1972 knew that it had a vision for the future, and that it was asking for the chance to put it into practice. Thirty years on, and after almost a decade in opposition, Labor needs to spark the same belief in the Australian people.

This is an edited extract from The Great Crash: The short life and sudden death of the Whitlam government (Scribe, 2005), which is a revised and updated edition of Michael Sexton’s Illusions of Power(1979).

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.