Big time, small time

Wednesday, 4 February 2009 

OK. You’ve delivered another address to the nation tonight, just like the one you did after the last stimulus package. You’ve got the Parliament and an army of media to explain your actions and report your statement. Why this extra little bit of drama? Why is it necessary? I mean, arguably, you keep underscoring the sense of crisis, this sense of danger, this is another national security stimulus package, which surely just feeds the public anxiety and becomes counter-productive to at least some degree. I know you’ve gotta inform, but why this endless kind of packaging as a sort of package of anxiety?

K O’Brien to K Rudd The 7.30 Report

It’s a good question. For the answer it might be best to look at what on the surface appears to be a growing divergence between this Labor Prime Minister and the last one.

For all the excitement around this latest package and what Labor and the opposition think is the best economic response, Keating gave the answer on Monday night, it’s pretty irrelevant. This is a global economic crisis and by that it doesn’t just mean that it is happening everywhere. It also means the solution will be a re-ordering of the global order, not only financial, but also political as the US faces the reality that after sixty years, its power to single-handedly drive the global economy is over. As Keating pointed out, a new political settlement is needed and since that settlement means the US having to accept diminished power, it won’t be easy.

Against all of that, whether Rudd takes the Budget into a deficit of 1% of GDP or 2% is neither here nor there. Keating’s view of the crisis also goes against the premise of Rudd’s fiscal action as he described it yesterday, that this will be just a short-term measure to tide the economy over. Whatever will have to be done will not only be at the global level, but will be for the long haul, dealing with a downturn that could by Keating’s reckoning last six or seven years.

Yet while at the same time Rudd’s economic actions seemed to be based on the premise that this is a short term downturn of the type that cash handouts can impact, he is not afraid to argue that politically it is an epoch-making ideological turn and ending what Rudd claims is thirty years of ‘neo-liberalism’. This is even if it includes, as Costello was only too happy to point out last night, the Hawke and Keating governments and the de-regulation they placed at the centre of their political agenda.

These seemingly contradictory actions are all for the same purpose, to prepare the political ground for what is coming up given the limited ability to prevent it in any practical sense. The economic actions buy time, and allow the government to look as though it is doing something. Then comes the neutralising and discrediting of any opposition.

The Costello interview last night showed how Rudd is managing to do this. It wasn’t as though Costello said anything wrong, and it was certainly a better performance than Turnbull’s the night before. Indeed a lot of what Costello said last night was correct, such as his highlighting of Rudd’s rapid U-turn over the last twelve months.

What Costello should be worried about though, was that Rudd could do that U-turn so easily. He and Howard were supposed to have placed economic debate in the straight-jacket of economic conservatism, the application of which allowed them to claim credit for the economic boom. That Rudd could so easily cast them aside shows that those old rules have gone. In fact, the supposed champion of free-market principles spent most of the interview claiming credit for all the regulation he brought in. The desperation with which Costello tried to keep the old battle lines is shown by his reference to Rudd’s cash hand-outs as ‘Whitlamesque’, which means barely anything to anyone under 50 (and actually seems to be quite a plus to the 20-somethings).

We are not looking at the return of Whitlam, nor even as Rudd asserts, social democracy. What we are looking at is the end of the right that has left the Liberals facing a crisis without a counter-crisis strategy. As Turnbull showed more incoherently the previous night, this is making it increasingly hard for the Liberals to stick to a position and follow it through. Comparing Turnbull’s performance to Costello may give further encouragement to those who want Turnbull gone, but what happens when they try and up the ante with Costello?

Posted by The Piping Shrike on Wednesday, 4 February 2009.

Filed under Tactics

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5 responses to “Big time, small time”

  1. RalphC on 4th February 2009 10:49 am

    These are very interesting times. Hard to see anything but Rudd gaining even more ascendancy while the Liberals flap about like a fish out of water. It’s also clear to see that Rudd’s intention is merely to be seen to be appearing to do something, anything. I think his latest ideological rant won’t go down too well either. I think that the real issue is that the public may in time come see all this spending as excessive and wasteful and economically irresponsible. And then Rudd’s credibility will be reduced. But then again, Turnbull is struggling to really offer an alternative, so Rudd may just get away with it.

  2. simone b. on 4th February 2009 11:03 am

    Malcolm Turnbull and his followers (apparently now also known as “Empty” and the Party of No)are playing a game the public will not appreciate. What do they think the prize is? While they gloat over the global recession and pray for its impact to get rid of the labor party from office next year they seem to discount the other players in the game – the general public. Or as they contemptously claimed in Parliament yesterday “the pokies addicts” referring to recipients of the last economic package. Most of us don’t react very well to contempt from anyone, let alone such a negative bunch as the current liberals and their cohorts.

  3. Kris on 4th February 2009 9:38 pm

    Whitlam’s probably popular with the 20 somethings because so many of them have or are currently accruing large HECS debts (or whatever they call it these days) and the only thing they know about Whitlam is that he made tertiary education free.

  4. Just Me on 5th February 2009 4:28 am

    “Or as they contemptously claimed in Parliament yesterday “the pokies addicts” referring to recipients of the last economic package. Most of us don’t react very well to contempt from anyone, let alone such a negative bunch as the current liberals and their cohorts.”

    Yep, that was a substantial political (and basic human) mistake, and just shows how far they have yet to travel back to humble reality.

    The government should give them hell over those remarks. Drag out a few genuine pensioners for whom the bonus payment enabled access to a desperately needed new bed or fridge, or long overdue car repairs, or best of all some basic dental care (coz HowardCo seriously ran down the public dental service during their time, one of their more indecent and ultimately costly policies). There will not be any lack of these pensioners. Bring ’em out and let’s see the opposition squirm as they try to avoid answering some pointed comments and questions from real people in real need.

  5. Mr Denmor on 7th February 2009 2:28 am

    It’s shameful how transparently both sides are using the GFC purely for political advantage.

    There is no sense of a wider vision at work. Instead, we see this endless arm wrestle that, while keeping the press gallery entertained, leaves the less exciteable and more globally engaged among us appalled at the tiresome irrelevance of our domestic political debate.

    But of the two sides, the Liberals seem to be the more superfluous. Perhaps if they spent less time trying to please Rupert’s isolated, discredited and dealt-out little gang of ideological warriors at The Australian they might find a reason to exist

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