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2012: the Australian Situation

By Peter McMahon - posted Monday, 16 January 2012

This will be a critical year for Australia, partly because of the global changes discussed in my previous piece but also because of certain national events and trends. The core institutional arrangements that have shaped our national political and economic affairs are all under major stress; there will be major change ahead and the coming year will tell us much about what kind and how serious those changes will be.

The national economy has so far escaped most of the global problems that began with the 2008 global financial meltdown, partly because of some effective fiscal and stimulatory efforts by the Labor government but mostly because of the ongoing rise of China and to a lesser degree India and the demand they generate. How long the Chinese economy can continue to grow is a moot point, but there are already signs that the boom is slowing down.

The Australian political system is now in a bad way. State politics is dominated by mediocrities whose primary concern is keeping basic infrastructure functioning, in the southern states as their economies grind along and in the northern states as resource exploitation generates increased distortionary pressures.


At the national level the political situation is dire, and 2012 will see whether we begin to really slide towards the abyss or reconsolidate. Firstly, we are led by arguably two of the worst leaders in our history, both of whom look decidedly temporary. But the rise to leadership of Gillard and Abbott also represents a real crisis for their respective parties, as well as the two-party system as such.

Labor leader Julia Gillard is exactly what you get if you opt for power over all else, a machine politician devoid of real principles. She is an insider focused on internal Labor processes and that strategy has given her ALP and national leadership. Her capacity for deal-making worked to get the numbers in a fragmented parliament to form government, but she is a known quantity now and whether or not she can become a genuine leader able to carry out major reforms is a big question.

Tony Abbott is a lurch backwards by a Liberal Party also increasingly unsure of its identity or values. Turnbull’s stumble allowed him in, but Abbott shows no capacity to respond to the real threats, especially climate change and the global economic crisis.

Gillard and Abbott have been in many ways a double act, each making the other look better than they are. Despite their apparent mutual hostility, they both represent the bankruptcy of the two major parties and their rise to power signifies big problems for the Australian political system.

Both leaders have potential successors waiting, the self-promotion juggernaut Bill Shorten an obvious option but more interestingly Greg Combet in the case of Labor, and of course Malcolm Turnbull in the case of the Liberals. Shorten would mean more of the same pragmatic power focussed leadership but Combet promises something more. His handling of the difficult carbon tax issue was highly competent after Penny Wong’s dithering.

Perhaps more important overall is the damage both parties have done to the political system as such. Abbott’s remorseless negativism has demolished the notion of the ‘loyal opposition’, and his refusal to recognise parliamentary tradition, such as pairs, has undermined that institution’s credibility. Similarly, the seduction of Peter Slipper into the speaker’s job by Labor has weakened that role and parliament itself as a place of genuine debate.


We have seen an attempt to crystallise some kind of populist right movement in the mould of the US Tea party, mostly focussed on opposition to a carbon tax, but aside from looking too much like One Nation, there is not the same religious core that exists in the US to push this concept far. The National Party and its spin-offs will suck up much of this incoherent rage but it is hard to see a viable political program emerging from it.

The Greens on the other hand have continued to prosper but they also face some major challenges. Most importantly they must manage the transition from fringe ginger group to serious political power and this will cause painful changes within the party. Inevitably, the true believers who worked so hard for so long will feel betrayed as compromises are made and careerists arrive. Bob Brown must retire soon, and the leadership succession process will be tricky. One thing the Greens have going for them is their relative cleanskin image, and this would be tarnished if some ugly factional or even personal dealing were to emerge.

Then there is the entirely unhealthy relationship between the national mass media and politicians. Between them the mass media and the major parties will serve up more puerile garbage to the Australian people in 2012 and pretend it is real politics, but perhaps the ongoing shift to online activity will eventually have a positive effect. Maybe the post-Murdoch focus on media in Australia will help generate a genuine improvement in standards.

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About the Author

Dr Peter McMahon has worked in a number of jobs including in politics at local, state and federal level. He has also taught Australian studies, politics and political economy at university level, and until recently he taught sustainable development at Murdoch University. He has been published in various newspapers, journals and magazines in Australia and has written a short history of economic development and sustainability in Western Australia. His book Global Control: Information Technology and Globalisation was published in the UK in 2002. He is now an independent researcher and writer on issues related to global change.

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