Election reflections

In recent decades Labor has been “pinned down” by pressures to reduce tax and contain public expenditure: but the complex situation emerging in Canberra could actually provide the context for genuine reform. It’s quite possible that - with Wilkie - the numbers could be mobilised in support of a “National Disability Insurance Scheme”, and for reform of aged care to provide dignity, care and social participation for our most vulnerable aged Australians.

There are also long-term trends; a variety of pressures that any new government - even one based on such a patchwork of interests - really ought to address.

There is a rising cost of living. Housing is increasingly unaffordable, and urban sprawl makes long transits expensive - worsened by a lack of public transport. Privatisation and corporatisation have seen the cost of basic utilities (energy and water) rise prohibitively. There is also an unfair tax mix which fails to give a “fair go” to those on low incomes, and an ageing population which will put pressure on public finances, as well as welfare and health services and infrastructure. Given these pressures, welfare and income support for students and the unemployed have failed to keep up, and so are manifestly insufficient.

These pressures necessitate investment in health, social housing and public transport, as well as progressive restructure of the tax mix, and more generous welfare and income support measures. These issues must be addressed as part of the exchange that decides which party forms government.

Of course big commitments would impact upon the budget, and it would necessitate progressive tax reform to finance them. On top of mining tax revenue, to provide for all these initiatives, any Labor government should aim to expand revenue (and hence scope for expenditure) in the vicinity of 1.5 per cent of GDP, or by around $16 billion annually in today’s terms (with further measured and incremental increases over several terms). One option - in the context of broader reform of the tax mix - could be to abandon planned Company Tax cuts.

Finally there is the issue of post-election reprisals within the Labor Party.

Some will believe that Labor should have held off going to the polls until later in the year, or even until 2011. And we will never know now what would have happened had the parliamentary caucus given Rudd a window of opportunity to turn public opinion around. Further, had Rudd resigned under circumstances of a voluntary agreement, the process would not have left such a bitter after-taste as it did for many.

So some are pointing to the leadership change; others are questioning the quality of the campaign. And then there is the issue of state Labor governments in New South Wales and Queensland - where infrastructure privatisation split the ALP within, and left some wondering if state Labor in New South Wales and Queensland stand for anything other than dividing the spoils of office. Certainly the intervention of the mining giants was crucial, comprising the real “turning point”. But the behaviour of the media - with sometimes-subtle, sometimes-blatant bias - was out of Labor’s control.

What’s crucial for the ALP now is that the process of reprisal and counter-reprisal not get out of hand. For the immediate future - while there is still some prospect of a minority Labor government - there is a need for internal discipline to maintain credibility.

But there will also be a need for analysis and reflection after the issue of who forms government is decided. What’s crucial in this context is the development of a structured and ordered process: honest reflection, but also inclusiveness to maintain cohesion (and hence credibility) and planning and mobilising for the next election.