In his book Good and Bad Power, Geoff Mulgan describes working in the inner sanctum of Tony Blair’s Labour government. On coming to office, Mulgan, as the director of the fashionable think-tank Demos, had played a major role in the development of many of the policies Blair took to government under the banner of "New Labour".
The heady days of 1997 were indeed intoxicating, but Mulgan found that the grand plans for the reform of Britain were quickly overtaken by the press of events. By the time he departed Blair’s office as the head of policy, he tells us in one particularly interesting aside, Blair and his close advisors like Alistair Campbell were thinking no further than 24 hours ahead.
In an interview with the ABC about his book back in 2007, Mulgan told Geraldine Doogue that "truth has been a very important part of what makes governments legitimate, and when they lose their claims to honesty and truth, that does them a great deal of damage."
Blogger Peter Brent wrote today that many of Labor’s problems stem back to a sustained erosion of its trust in the electorate. "This government has two big, related problems," he writes. One of them is an issue we’ve tackled many times here, the strange disconnect between the public’s perception of the economy and the government’s generally effective management of it. But Brent’s other big problem would be recognisable to Mulgan: "the lack of authority, the perceived emptiness up there, the feeling that no one is really in charge, that decisions are being made for reasons other than a conviction that they are ‘right’."
Whatever your views about the "mainstream media" and its penchant for obsessing over opinion polls and leadership speculation, it’s not hard to identify this sentiment in the community. Nor is it too difficult to point to specific instances where Labor has squandered its political capital, by backflipping over key policy issues.
Labor’s first serious attack of self-doubt came at the end of 2009, when negotiations with the Coalition over the Carbon Pollution Reduction Scheme broke down, and Tony Abbott replaced Malcolm Turnbull as leader. In retrospect, Labor missed a golden opportunity to go to a double dissolution election on the defining issue of climate change — an election most think it would have won.
Instead of regrouping, Rudd’s decision to drop the CPRS turned out to be the beginning of the end of his prime ministership, ably assisted by the mining industry’s $22 million campaign against the carbon tax and the usual Machiavellian manoeuvres by the right-wing factions in Labor’s darker recesses.
Tearing down a sitting prime minister was a breathtaking gamble. It demonstrably failed, demolishing most of the public’s trust in this Labor government. By the time Julia Gillard’s decision to back flip on the carbon tax made her election campaign soundbite to Network Ten ("there will be no carbon tax under the government I lead") the most memorable line of her political career, Labor had managed to inflict more damage to its brand than Tony Abbott.
Now, after five bruising years in office, Labor is attempting to marshal its forces for a final tilt at a third term. It’s discovering, as governments often do, that much of its political capital has already been spent, and that in reform terms it is later than anyone realised.
The Gonski schools funding reforms are perhaps the perfect example. Labor has long desired to reform schools funding to make it more equitable, and Julia Gillard has spoken often about her commitment to education as a key Labor value. Despite this, it is now 18 months since merchant banker David Gonski released his blueprint for reform.
While everyone recognises there is a need for consultation, and the funding formulas are fiendishly complex, the hard truth is that Labor has waited until the very end of its second term to address the issue. In fact, we’re still waiting. Last night, Schools Minister Peter Garrett was on Lateline telling viewers that the government’s response was "very, very close".
That delay means that Labor comes weakened to the critical negotiations with the states over schools reform. The difficulty of pursuing major reforms in the Australian federation is not a new problem, but the difficulty levels ramp up quickly when a weak federal government confronts a series of strong premiers. With an election set for September, Ted Baillieu, Barry O’Farrell and the other Liberal premiers are reasonably calculating that they will be in office long after Julia Gillard’s government passes into history. This is only encouraging the well known tendency of state premiers to score points at Canberra’s expense.
Thus, in recent weeks, we’ve seen the Victorian government fight and win a nasty battle with the feds over hospital funding. The background to the dispute lies in arcane calculations about the growth in Victoria’s population, which led to a $107 million adjustment in the large increase the Commonwealth sent to Melbourne’s hospital system. Victoria’s Health Minister David Davis was successfully able to paint this as a funding cut (it was in fact a big increase), even while his own government was cutting $130 million from the system in "efficiency" measures. Predictably, it was the feds who eventually capitulated, with Health Minister Tanya Plibersek announcing she would restore the $107 million after all.
Emboldened by this victory, the Baillieu government has now abandoned talks to implement Gonski, and instead unveiled its own plan to increase funding to Victorian schools. The proposal is being painted by the Victorians as a serious plan, but it is also a very handy political weapon with which to beat up on Peter Garrett and his slow motion reform process.
The delay has also given the powerful independent and Catholic schools lobbies time to prepare a scorched earth campaign against a reform plan that will, by definition, move more government resources towards government schools (where the disadvantaged students are).
All in all, you wouldn’t put too much faith in schools funding reform as a policy platform likely to drive Labor to victory at the next election. What was achievable in 2008 or 2010 looks increasingly impractical today.
It’s instructive to remember how schools funding became so skewed towards private schools in the first place. When John Howard and his education minster David Kemp decided to radically alter the formula for the Commonwealth’s funding for schools back at the turn of the millennium, they held no press conferences and released no white papers. They simply changed the formula. The education unions and a few of the Labor states protested, but they lacked traction. An amazingly unbalanced playing field was created with little public debate.
Labor doesn’t have that option, as the debacle of the Victorian hospital funding shows. But now Julia Gillard is running into other problems. Can it bring the states to the table, to voluntarily reform their own schools systems? And where will it find the $6-7 billion a year in funding? All of these are a part of Labor’s larger conundrum, which is that it lacks the strength to do what it needs to seem strong.
Increasingly seen as a lame duck government, federal Labor is beginning to inhabit a self-fulfilling prophecy.