Of Tea Leaves and Sledgehammers


Here we go again. The Canberra Press Gallery is often accused of being full of obsessed insiders. We peer through the nuanced tea leaves and strain to pick up the political whispering, and interpret all sorts of things that are of little relevance to anyone but ourselves.


One of our most derided obsessions is the never-ending question of leadership and that’s leadership of any Party: Nats, Liberals, Labor or Democrats. Like a persistent cold sore, leadership speculation inevitably surfaces to fill the vacuum during the winter parliamentary break. And it is true that there have been times when the Gallery has been guilty of reading too much into leadership speculation but now is not one of those times.

The issue of the leadership of the Federal Liberal Party is now all-consuming and will continue to be until the current Prime Minister puts it to an end one way or another. And with everyone starting to focus on the 2007 Federal election, John Howard really only has a few months left to do it. Peter Costello knows it and he and his supporters have started applying the pressure.

Over the last couple of months, we’ve witnessed an uncharacteristic period of political ineptitude from John Howard. We saw him swan off to the US, Canada and Ireland for well, for what exactly? Follow that with an embarrassing albeit popular backflip on the Snowy Hydro privatisation, and then a number of other serious backbench revolts.

The worm has truly begun to turn on Howard’s once impregnable grip on the job.

The pressure started just a few weeks ago, with Costello’s speech at the aptly named Machiavelli restaurant in Sydney. That was notable for his call for a ‘new federalism’ but included a number of other significant policy positions and propositions as well. It was clearly designed to put some distance between him and Howard to portray, once again, the leader-in-waiting as a new generational figure with a vision.

The next day, Costello flew off to the Solomon Islands where he let the story run for a while. Then came what was a calculated flight of verbal mischief. Costello knew he’d be asked about leadership he always is, these days. And when the inevitable question came he stirred the pot.

‘When will the transition be?’ he was asked. ‘Can I just ask you a plain and simple question? Is there an understanding between you and Mr Howard as to his departure?’ There is a well-worn formula for these sorts of exchanges and if it’s not stuck to, then everyone gets more than a little excited. Costello knows that, so do the journalists travelling with him.

‘Look,’ Costello replied, ‘these things have worked in the interests of the Australia people and the Liberal Party and the people concerned, and there is no point in speculating on it.’

Full of nuance and sprinkled with tea leaves.

And from there, we were off.

A few days later, on 7 July, John Howard’s good friend and former Chief of Staff, Grahame Morris, told ABC TV’s Lateline program that ‘somewhere around November’ the PM will focus on the issue of the Liberal leadership and everyone will know ‘ somewhere around Christmas.’ Having delivered the message, Morris walked out of the ABC studio in Parliament House, straight down to the ministerial wing and, no doubt, into the PM’s office.

Nuance with a sledgehammer.

Then came the big one. In 9 July’s Sunday Telegraph , Glenn Milne, the journalist closer than any other to the Treasurer, reported that there had been a deal, as many had thought. Way back in December 1994, a month before he took back the leadership of the Liberal Party from Alexander Downer, Howard promised Costello he wouldn’t be hanging around too long. Two terms, he said. And a witness to the meeting, the then Shadow Environment Minister and Howard loyalist, Ian McLachlan, finally, publicly confirmed the story.

Thanks to Fiona Katauskas.

But if you really needed incontrovertible proof of a rapidly turning worm, then you had to look no further than the extraordinary editorial in The Weekend Australian the day before. Headlined ‘Is that all you’ve got Mr Howard?’ it basically napalmed the Howard legacy. Picking up on Costello’s call for a new federalism, The Australian said Hawke and Keating were the real reformers: ‘Mr Howard’s legacy may amount to little more than a plan to scale back the Senate Committee system Howard’s current IR changes are dwarfed by the far reaching economic deregulation and even industrial relations moves by Labor.’ And, ‘if Costello has now decided to come to the party on reform he is more than welcome.’

The editorial concluded by basically calling on Howard to kick-start reform or get out of the way and give the job to someone who will. Tough stuff indeed from the most Howard-friendly paper in the country, and a big shift from their previously hostile anti-Costello stand. Maybe Peter’s little chat with Rupert over the pre-lunch cocktails at Machiavelli paid off.

Costello’s supporters within the Liberal Party have been arguing for an orderly transition for some time now. This is looking less than orderly but it is a clear indication that they are now prepared to press home their political advantage. The word is out the Liberal leadership needs renewal and quite a few in Liberal ranks appear to be listening. Peter Costello is a new generation. John Howard has vision fatigue. A transition orderly or not, now seems inevitable in the next few months.

And there is (once again) talk of a challenge.

A year ago, Costello was privately saying he was prepared to go to the backbench and ‘carp’ to actively destabilise the Howard leadership. Costello would lose a challenge at this stage, and his supporters acknowledge that fact. But they point out that a simple analysis like that is facile. Leaders can be damaged by a challenge even if they win, they say. And a government with Costello on the backbench would be ‘bi-polar.’ This would not be the ‘elegant departure’ that’s been spoken about and Howard should start thinking seriously about his legacy and the long-term good of the Party.

This is a transition the ALP is already welcoming with foolish enthusiasm. Apparently, they have a secret ‘Costello attack plan’ already in place he smirks, he’s insincere, and he’s indifferent to the hardships faced by ordinary Australians. Trouble is, they tried that last time. Labor’s attack ads at the 2004 Federal poll focussed almost exclusively on Costello they failed then, and they’ll fail again.

In 2007, despite the fact that he’s been holding the Treasury levers for well over a decade, Costello will be able to claim that he is the face of renewal against Kim Beazley, a Labor leader too easy to paint as a relic of the Hawke/Keating era.

You can bet the Costello camp has already got a few secret attack plans of their own.

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.