Monday, October 11, 2004


Various people say that Leftist leader Mark Latham lost because of his bullying personality but, seeing that John Howard is a totally colourless personality, it seems to me that neither party had much to offer in the charisma stakes. So I think it does come down to policies.

Australia is lucky that its major Leftist party (the Australian Labor Party or "ALP") is one of the most conservative Leftist parties that there are (only Singapore's P.A.P. springs to mind as a rival). The sort of pro-market, pro-free-enterprise reforms that were in the USA and the UK the work of Reagan and Thatcher were in Australia principally the work of the ALP. (Though it was John Howard who nobbled the unions via the big defeat of the maritime unions).

The Australian Left was not always like that, however. The short-lived Whitlam (ALP) government of the 1970s did a lot of damage to the economy -- mainly through amateurism rather than ill-will towards anybody, though. And even the Whitlam government had some worthwhile economic policies -- with the fact that it started the process of dismantling Australia's traditionally highly protected economy being particularly to its credit. For what I wrote on the Whitlam government at the time, see here.

The damage that the Whitlam regime inflicted on the economy (mainly through overspending, with the resultant high inflation) did great harm to the reputation of the ALP as economic managers -- so that subsequent lacklustre conservative governments won office primarily because they were not the ALP. Nobody wanted a repeat performance of the disruptions of the Whitlam years. And to this day both major Australian parties make a big thing of their committment to surplus budgets -- though few people probably remember now that the committment originated as a reaction to Whitlam's big deficits.

Principally in the person of former Rhodes scholar Bob Hawke, the ALP saw therefore that they had to take economics seriously if they were to have the lasting trust of the Australian electorate. So when the conservative coalition finally died of total inanition (principally in the person of the inert Malcolm Fraser), and the ALP finally regained power, Hawke took the opportunity to show that the ALP too could be economically rational -- by privatizing various government businesses, by reducing tariffs, by balancing the budget etc. Bob Hawke has however now long retired to private life and his legacy is beginning to wear off. And the first clear sign of that is the set of policies that ALP leader Mark Latham fought Saturday's election on. Although he has an honours degree in economics, Latham seemed to decide that it was time for the ALP to veer to the Left in many respects. He promised to get Australian troops out of Iraq "by Christmas", he shafted the forest industry workers in favour of a deep Green policy of banning the cutting down of almost all native trees, he made huge spending committments to the elderly and, most incredibly, refused to rule out raising taxes. The latter policy alone would probably have served to lose him the election.

So with all due respect to other more complex analyses (e.g. here) of the reason for the ALP's recent defeat, it seems clear to me the reason is very simple: The ALP lost simply because they were too Leftist for the Australian people. If Latham had stuck to the policies of his esteemed predecessor, Bob Hawke, he might well have won. It has often been said that Margaret Thatcher's principal asset was always the (then far-Left) British Labour Party. Similarly in Australia's recent election, Mark Latham was a considerable asset to John Howard.


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