NSW state election: competing interpretations

Then there were the policy debacles and the public brawling over policy; most important was the electricity privatization imbroglio that brought down Iemma in the midst of deadlock between the party organization and the government. There were also broken promises and flip-flops over urban transport and health. Gridlock on the roads and failures in public transport seem to have bothered city voters most, even more than the failures of the health system.

On top of all this was a born to rule mentality, encouraged by the long term in government. Leading figures seemed to be squabbling over the spoils of office. Labor's culture was introspective and narrow and increasingly arrogant. Party membership was falling and internal party democracy was flawed, a point made relentlessly in books and articles by former state Labor minister Rodney Cavalier.

The competing Labor-brand explanation must begin from the fact that all this happened in the largest state in Australia and in the jewel in the Labor crown. At the very least devastation in NSW Labor must have a wider impact on Australian Labor. NSW elects a third of the seats in the House of Representatives after all. How will NSW Labor fare in the next federal election?

Furthermore, NSW Labor plays a major role in federal Labor, a fact that Opposition LeaderTony Abbott has seized upon. Senator Mark Arbib, former NSW state secretary, has not only moved to Canberra but was a leader figure in deposing Kevin Rudd as Prime Minister. The links between NSW Labor and federal Labor are easy for critics to make.

Kristina Keneally offered the explanation in her concession speech on election night that voters had not deserted Labor but Labor had moved away from the voters. This suggestion points to the match between Labor policies and the electorate. If NSW Labor became fatally out of touch with its electorate then perhaps the ingredients are common to all Labor parties across Australia.

There are some federal-state policy links too, though the implications for other governments are less clear. The carbon tax proposal was used by the NSW Coalition to link Keneally to Julia Gillard in billboard-sized advertisements. The suggestion of a new tax certainly didn't help NSW Labor in an environment of rising cost of living concerns, but it was among the least of their worries. In the week of the state election federal Labor actually bounced back at the polls. It is drawing a long bow to suggest that Gillard was Keneally's problem.

What are Anna Bligh and Julia Gillard thinking now? They will share a concern that Labor has endemic problems that may undo each of them. The recent Labor National Review indentified many of these inescapable cultural and organizational party dilemmas. But they will have more practical concerns.

Gillard will have two priorities, apart from insulating her government from the debacle. The first is to make the new dynamics of the federation work for her. In her relations with both the Senate and state governments she must focus on negotiating workable outcomes. As the balance of COAG swings against her she must work with the new Coalition governments. They may be against health reforms, the carbon tax and the mining tax but they also need policy progress to satisfy their own constituents.

Barry O'Farrell, Ted Baillieu and colin Barnett are quite different characters to Abbott and will have their own often-different styles and agendas. Time will be on Gillard's side. It cannot be assumed there will be a common Coalition front against Gillard. That is not how federalism works. Over time the three Coalition Premiers will increasingly face the harsh realities of service provision in the modern era and come to recognize, if they don't already, the enduring problems in state politics that are bigger than party. They can't sit back and wait years for an Abbott government. They will enjoy very long honeymoons but eventually they too will start to make difficult choices and hence become unpopular.

Time may also be on Gillard's side electorally even if future state and territory election results continue to be dire for Labor. She will have many good stories to tell the electorate, learned from John Howard, about the dangers of Australians putting all their eggs in the one basket. The next federal election result is far from decided.