Friday, August 20, 2010

Contempt Does Not Pay

Today’s opinion polling shows a late surge of support for Tony Abbott and the Coalition for tomorrow’s Federal election. Support for the coalition is also evident in late money placed with the bookies, although that might have something to do with how attractive the odds have been for people looking to cash in on an outside chance. Editorials in the News Limited papers have predominantly supported Tony Abbott, while the editorials in the Fairfax papers have favoured Julia Gillard. It is literally too close to call as we approach polling day tomorrow. But if the Labor Government does lose tomorrow, I suspect that it will largely be due to the lingering sentiment expressed exceptionally well by the Telegraph editorial written by Garry Linnell. The Daily Telegraph says, “If ever there was a blatant admission by a party of its own failings… the South American-style coup that ended Rudd’s prime ministership… was it.”

While I support the plan for a National Broadband Network, I want public hospital reform to be delivered, and I believe that a Mineral Resources Rent Tax is fair and reasonable, I share with many Australians the disappointment that when the opinion polls began to reflect that the government had some problems the Labor Party tried to fix the polls instead of fixing the problems. I share with many Australians the disappointment that instead of changing the policies, the Party chose to simply change its leader, apparently expecting us all to fall for a pea and thimble trick without actually doing anything about the underlying problems which had prompted the Party’s decline in popularity in the first place. While many people feel a great unease about the way Kevin Rudd was betrayed by his own colleagues, the greater resentment stems from the sense that the rest of us have been treated with contempt by a handful of powerbrokers who have been perceived as putting Party before principle.

The decline in popularity experienced by the Rudd government was the direct manifestation of the people of Australia sending the government a message. The response of the Labor Party indicates that they did not get the message, and that’s why the polls today are still at the same level they were when Kevin Rudd was dumped. Our message to the government was quite simply that we were unhappy with the mismanagement of government programs like the Building The Education Revolution and the Home Insulation Program, the hamfisted attempts to introduce the mining tax, and the perceived abandonment of any credible climate change policy.

But the message sent by the Australian people was not a call for a change of leader, it was a call for an improvement in the government’s performance. But this is the core of the problem. We measure the performance of a government by the outcomes that are delivered in hospitals and highways, infrastructure and services. The powerbrokers measure performance by opinion polls. What they have failed to understand is that good opinion polls are not the goal. It’s good government that is the goal, and the best way to achieve the former is to deliver the latter. It is the same lesson that the New South Wales Labor Government has consistently failed to learn, and could well be enough to see this government lose office tomorrow.

Perhaps then they will finally understand that it does not pay to treat the voters with such contempt.

Thursday, August 19, 2010

Only Two More Sleeps…

Two days out from the federal election and it’s still too close to call. If we are to believe the opinion polls then the Labor Government is just slightly ahead on the two party preferred basis. But even if that accurately reflects the outcome of the popular vote, it doesn’t guarantee that Labor would win sufficient seats to hold government. Kim Beazley and Andrew Peacock both lost elections while winning more than 50% of the votes because they didn’t win enough seats in the Parliament. The bookies have the Labor Party holding onto power with a slender majority, perhaps as slim as just one seat, and even they can be wrong sometimes. The truly amazing thing is that twelve months ago it was a very different story. This time last year, Kevin Rudd enjoyed phenomenal popularity, the government was basking in the warm glow of approval, Malcolm Turnbull was leading the Liberal Party to nowhere in particular, and the Copenhagen Climate Conference was yet to occur.

They say that a week is a long time in politics, and in that case twelve months is a geological age. Two significant shifts have occurred over that period of time. One is that the government lost its reputation as being competent, despite the success of navigating the global financial crisis without falling into recession, while the other is that Tony Abbott has transformed the Liberal National Coalition into a viable alternative. Love him or loathe him, the truth is that Tony Abbott has been remarkably successful at getting the coalition back into the race. There has been a most remarkable role reversal where the government is no longer trusted, but the opposition is now seen to be both stable and pursuing a clear direction. Win, lose or draw, Tony Abbott is already a winner in that sense, and will continue to lead the Liberal Party after the election regardless of the outcome.

This leaves Australians with a difficult choice. There are plenty of reasons to vote AGAINST both major parties. Tony Abbott supported Work Choices, he failed to advance hospital reform when he had the chance, he has big ears. Julia Gillard stabbed Kevin Rudd in the back, she wasted money on expensive school halls, she has red hair and isn’t married. But when it comes to policy, there’s not as many reasons to vote FOR either major party. On asylum seekers both sides are trying to be tough, on the budget deficit both sides promise to return to surplus by 2013, and on industrial relations both sides are promising to keep things as they are. Both sides want hospital reform, but have a different approach, and both sides want a broadband network, but at different speeds.

That’s one of the reasons why much of the political advertising has been so personal, each side attacking the other for their perceived shortcomings. Both sides are calling the other incompetent. Both sides are calling the other untrustworthy. Both sides are calling the other fools. Wouldn’t it be terrifying if both sides were right? That’s why the polls are so close, and why it’s so difficult to pick a clear winner. There’s a significant number of people who are equally disenchanted with both sides, and bemoan the lack of an alternative. But on Saturday when the crunch comes and pencil is put to paper, most people will make a choice. If the opinion polls are right, it means that Julia Gillard will be returned to office, but even if she is, both sides of politics need to recognise that we expect them all to lift their game.

Wednesday, August 18, 2010

The Herd Of Elephants In The Living Room

The phrase “the elephant in the room” has become extremely commonplace in the last couple of years, although it has been around at least since 1959 when the New York Times printed: “Financing schools has become a problem about equal to having an elephant in the living room. It's so big you just can't ignore it." More recently it has been commonly applied to the issue of climate change, and last week Dick Smith claimed that the real elephant was the link between climate change and population. The use of the phrase seems to have exploded since Al Gore’s “An Inconvenient Truth”, and is now frequently used to describe just about any obvious but inconvenient fact which nobody wants to acknowledge, no matter how significant it might be. All of a sudden, it seems that there are an awful lot of elephants all crowded into the room, demanding our attention.

The interesting thing is that many of these elephants are in fact related to each other. Just as climate change, sustainability, and population are linked, all of these are also linked to issues of community infrastructure, energy security, food security, and Australia’s favourite obsession, housing. Figures reported today indicate that residential rents in Sydney are outpacing inflation by as much as a factor of ten, with an average increase of 4.8% in the June quarter. At the same time, the latest housing affordability index shows that home buyers are also being stretched with houses becoming less affordable by 9.1%. This reflects both the increases in mortgage interest rates earlier this year and the growth in prices which was relatively strong up until a month or two ago. Both rental prices and purchase prices are on average becoming more expensive, but it’s not uniform across the nation.

The worst of the rental price increases are in Sydney, with many other parts of the country remaining relatively stable. Purchase prices have been rising fastest in Sydney, Adelaide, Brisbane and Melbourne, while homes in Perth and Canberra have become more affordable. But in every case, both rental and purchase markets are afflicted by a nationwide shortage of new home construction. It is estimated that the Australian housing market is undersupplied by about 200 000 dwellings, and that at the present rate it will reach 300 000 in the next four years. Foreign analysts keep warning us that our houses are overpriced by 40 to 60%, and that something has to give. But as long as the supply problem is not addressed it is hard to see just how prices might be expected to fall, whether quickly or slowly, whether in absolute terms or in real terms. But this is where the elephant barges into the room.

If house prices do not fall in real terms, that is, in terms measured against incomes and inflation, the very real consequences are that the Australian Dream will die. There are many different ways you can measure the prices of homes, as a proportion of average income, or of household income, or against the price of other consumer items, but no matter which way you measure it people are less able to afford to buy a home. There are many contributing factors, and the lack of supply is just one of them, but the end result can only be that our way of life is under threat. But the elephant, standing in the corner waiting to be noticed, is the simple fact that people must live somewhere. It is not sustainable to have a stock of housing that is simply out of reach for ordinary everyday people.

Sooner or later, something has got to give, which means that either house prices must fall relative to peoples’ capacity to pay, or our standard of living will instead.

Tuesday, August 17, 2010

The Only Poll That Matters

With the outcome of this weekend’s Federal election so difficult to predict, and the opinion polls giving a range of different figures which keep changing form day to day, there is a genuine prospect of a hung parliament. There are four independent members currently sitting in the House of Representatives. One of them is Michael Johnson, the disendorsed former Liberal member from Brisbane who is unlikely to survive the election. The other three however appear to be a strong chance to keep their seats. One of them is Bob Katter who was once a National Party member, while the other two, Tony Windsor and Rob Oakeshott, hold what were once National Party seats. There is also a reasonable prospect that another independent, John Clements, might just win the seat of Parkes. With the major parties deadlocked in what seems to be a very close election it could turn out that these three or four men could hold the balance of power.

There is also the possibility that one or more Greens could, for the first time, win seats in the lower house. Ironically, in seats such as Melbourne, Sydney and Grayndler, the Liberals are directing preferences to the Greens ahead of Labor, so it is possible that Liberal preferences will help to elect Green Members who are more likely to support a minority Labor government than a minority Coalition government. While the opinion polls are showing a two party preferred split of 51% or 52% to 49% or 48%, it’s the primary vote that will really show the mood of the people. As far as I can tell, judging by the people who talk to me, the mood of many people is such that if there was a box marked none of the above it would attract a substantial number of votes. In a way, it’s the same mood that has been reflected by former Labor Leader Mark Latham’s advice to cast a blank ballot to register our disapproval for all candidates.

In the end though, casting an informal or invalid vote is counterproductive. We might think we are sending a message, but just what is the message, to whom are we sending it, and would any of them actually get the message? I believe not. As galling as it might be, this election is essentially about making a choice between the two major parties to form the next government. If you want to support the Greens, you can, and if they have enough support they will win seats. But thanks to preferential voting, if your choice of a Green candidate is not successful, you still have a say in choosing between Liberal and Labor. If you want to support an independent candidate, you can, and if they have enough support they will win a seat. But, once again, if your independent candidate is not successful, you still have a say in choosing between Liberal and Labor. Giving up your right to make that choice could just mean ending up with the government that you least want.

Besides, if there are enough Independent and Green politicians elected to parliament that will itself send the mainstream parties the strongest message that we possibly can. If there is a hung parliament, it would not be the ideal outcome, but it would certainly make the major parties sit up and pay attention. It’s easy to feel that any one individual vote doesn’t count for much, but every vote counts, and every vote can make the difference one way or another. Don’t listen to Mark Latham. Don’t throw away your vote. Don’t step aside and let someone else determine who will run our country. Think about what you believe is important, and have your say at the ballot box. In the end, it’s the only opinion poll that really matters.

Monday, August 16, 2010

Moving Forward To The Finish Line

After declaring that the Coalition had won the first two weeks of the election campaign, and calling the third week a draw, I believe that the fourth week has been a narrow victory for the Labor Party. It began well with early signs of a comeback showing up in some of the opinion polls, and a strong performance by the Prime Minister in a television appearance on the ABC. The ongoing distraction provided by former Labor Leader Mark Latham achieved two things that may have helped Labor: it removed the spotlight from Kevin Rudd’s activities, and it may well have actually generated some sympathy for Julia Gillard. His intervention might have been viewed as embarrassing, but if anything many people might have felt that no Prime Minister should be subjected to the kind of treatment that Mr. Latham dished out.

At the same time, Tony Abbott slipped up with his failure to display a grasp of the importance of the internet and broadband. Other than that however, the Coalition campaigned solidly. In particular, Mr. Abbott enjoyed a strongly positive response to the Town Hall style meeting at Rooty Hill on Wednesday night. The Prime Minister spoke first, and took questions from the audience, but was upstaged literally when Tony Abbott took to the floor and declared that he wanted to be “on the level” with voters. It was a very smart and very effective tactic and it worked in his favour, and the show of hands declared Tony Abbot to be the winner on the night. Regardless of later concerns about whether or not the supposedly undecided voters in the audience may have been infiltrated by party supporters, it was a very good outcome for Mr. Abbott.

Overall, a narrow victory for Labor in the third week of the campaign is born out by the latest opinion polls. Signs of a bounce in the poll figures began to emerge last week, and the most recent polls have Labor marginally in front in a very close race. The Newspoll published today shows Labor holding 52% and the Coalition 48% of the two party preferred vote. The Neilson poll shows Labor leading 51% to 49%, and there was even one apparently rogue poll showing Labor at 57.5%. Whether it is enough to achieve victory on polling day remains to be seen, because it is quite possible to win a majority of votes without winning a majority of seats, but it still represents a move in the right direction for the Labor Party.

So now we have entered the fifth and final week of the campaign, and the finish line is well within sight, but it’s still too early to tell just who will cross it first.