Keating: The PM who should have got out more

Review of Don Watson, Reflections of a Bleeding Heart: A Portrait of Paul Keating PM, Knopf/Random House Australia, Sydney, 2002, 756pp.

Part One: hard heads, bleeding hearts, and true believers - working with Paul Keating, PM, January 1992- March 1993.

The Director of the Whitlam Institute, Peter Botsman, recently attributed his conversion to ‘Third Way’ politics to taking up a position in the Western suburbs of Sydney, and spending long hours on public transport listening to everyday conversations.

My interest in this story was related less to ‘Third Way’ politics, which the Australian Labor Party has arguably been practicing since Bob Hawke became Prime Minister in 1983, as to the virtues of public transport and travel to the suburbs. After reading Don Watson’s Reflections of a Bleeding Heart, one of my gut instincts was a view that Paul Keating may have benefited considerably in his time as Prime Minister of Australia from taking more bus and train rides, and listening to ordinary folk. The factors that ensured that he didn’t, for reasons partly related to the person and partly related to the office, are one of the many things that make Watson’s book such a compelling piece of Australian political biography.

Reflections of a Bleeding Heart

is one of the great pieces of Australian political writing. It combines considerable scholarship, a compelling prose style, and the unique perspective of one who was both an insider on the Keating Prime Ministership and a Paul Keating fan, yet was also deeply troubled by the growing political disconnect between the Keating Labor government and the Australian people. This becomes, in Watson’s account, a metaphor for the wider disconnection between government and its citizens more generally, that becomes so apparent in Australia in the mid-1990s.

The key to appreciating this book, in my view, is to understand that it is not a biography of Paul Keating. Rather, it is the product of a diary kept by an academic historian turned political staffer, whose actions and thoughts over the 1992-1996 period are inescapably shaped by his choice of profession and employer. Watson observes in the Preface that "the book essentially records events as I saw and reacted to them from within the Prime Minister’s Office" (p. x).

He also points out that it would be himself, and not Paul Keating, who would write such a book. When he informed Keating of his intentions to keep a diary and write a book, Keating’s reply was that political autobiographies are invariably written by the self-serving and weak-minded, and he would just as soon take up lawn bowls as write one. While Keating no doubt had Bob Hawke in mind when he made the remarks, the failed Cheryl Kernot venture into this genre makes Keating’s comments look wiser over time.

Reflections of a Bleeding Heart

is a book of two parts. The first part, covering the period from Watson starting work in the Prime Minister’s Office (PMO) to the ‘sweetest victory’ election of March 1993, is the best. This was clearly the best time to be working for Keating. The book begins with a wonderful portrait of the Keating and Watson families, and how utterly different they were. The Keatings, suburban working-class Sydney Irish Catholics, were rusted-on Labor people, to the point where it was natural for Paul Keating to join the Labor Party and start organising in Young Labor from when he left school at 15 - an age at which Watson observes that he himself ‘wouldn’t have known how to join a party or where to find one’ (p. 10). Don Watson’s family, by contrast, were rural Victorian farmers of Scots Presbyterian background, for whom history moved in a seasonal rather than a linear pattern, and for whom the Liberal Party generally, and Bob Menzies in particular, represented a natural order in Australian society, disrupted only by the rabble-rousing likes of Jack Lang, Paul Keating’s political mentor.

By becoming a leftist historian and a Labor Party member, Watson became an outsider to his own family; by joining PMO, he was entering as an outsider into two cultures that much of the book seeks to understand. One of these is Labor Party culture or, more precisely, that of the ALP National Secretariat, or ‘Head Office’. Although Keating was personally a product of the ascendant NSW Right faction of the ALP, he never really accedes to the expectations of Head Office, and this friction between PMO and the national secretariat bubbles just below the surface throughout Keating’s Prime Ministership, rising quite dramatically during the 1993 and 1996 Federal election campaigns.

Much of ALP Head Office, as well as key factional leaders, had supported Hawke against Keating in their leadership battles of 1991. They worried whether Keating was ‘wide’ enough, able to think beyond a Treasurer’s mindset about national issues. Bob Hawke never leaves the scene for all of Paul Keating’s Prime Ministership, frequently making himself available to the media to comment on Keating’s qualities, most famously with his claim in his autobiography, published in 1994, that Keating had called Australia the ‘arse end of the earth’. Indeed, Keating claimed that he could still smell Hawke’s (or, as Keating called him, ‘Old Silver’s) cigars in the walls and furniture of the Prime Ministerial Offices, and that The Lodge reeked of cigar smells (p. 19).

The second culture to which Watson is an outsider is that of Keating’s office itself. A simple reading of this would be that it was a conflict between the ‘pointy heads’, who had accompanied Keating from Treasury to PMO, such as Don Russell and John Edwards, and the ‘bleeding hearts’ of the title, such as Watson, Mark Ryan and, for a period, Anne Summers, who sought to humanize and broaden Keating’s profile as a social progressive and not simply an economic hard-head. While this sometimes played itself out as a conflict between the ‘economic rationalists’ and their critics, the reality is considerably more complex, as Watson notes at several points in the book.

In Watson’s view, advisors such as Russell and Edwards had become too set in their policy reflexes, suspecting any form of economic pump-priming to address unemployment as a step on the slippery slope of ‘Keynesianism’ and a loss of economic control; seeing measures to assist regions as a variant of the failed ‘RED schemes’ (Regional Economic Development) of the Whitlam era, as likely to boost local cannabis consumption as reduce youth unemployment; and accusing advocates of industry policy of being ‘Creanites’, or believers in the ideas of former ACTU President (and now ALP leader) Simon Crean (There must now be a lot of cringing in Labor ranks about this epithet!).

By 1992, however, the political landscape had changed for Keating, and those in his office, for two reasons. First, with unemployment over 10 per cent, interest rates at record levels, and Paul Keating so personally identified with Australia’s economic restructuring, claims that things will get better if only policy stays with the ‘economic fundamentals’ were wearing very thin. Moreover, the landslide loss of Labor in Victoria in October 1992 clearly pointed to the need for a change in tack, even if Paul Keating and Jeff Kennett probably had a lot in common in their assessment of the Cain-Kirner governments in that state.

Second, with John Hewson, the new Federal Opposition leader, being so focused upon deregulatory economics with his Fightback! policy manifesto, Keating needed to stake out alternate territory. This partly drove him towards more interventionist economics with the One Nation economic policy package, and certainly hardened rhetoric that was skeptical of free market economics.

Perhaps more importantly, it encouraged a shift in the terms of debate. Keating’s raising the issue of Australia becoming a Republic, and the associated rhetoric of national independence, was demonstrably going well with a large section of the electorate. Polling was indicating that a lot of voters were getting sick of endless lectures on the economy, and enjoyed Keating’s change of tack to questions of national identity, as long as he didn’t talk about changing the flag. Similarly, speaking positively about the arts and national culture, and passionately about Indigenous deprivation, was not necessarily winning swinging voters to Labor - fear of the GST was the primary factor there - but, for almost the first time since 1983, bringing disaffected Labor supporters back into the fold.

On the 1993 Federal election victory, Watson recognises the extent to which it was not simply won by Paul Keating, but lost by John Hewson. This is acknowledged in his comments about the period when the campaign began:

For eighteen months John Hewson had every right to believe that the prime ministership was in the bag. But Keating did to Hewson what he and his colleagues had done to the Liberals for a decade- he drove him further and further to the right. It wasn’t hard: in the course of the year Hewson’s enthusiasm and self-belief took a near-fanatical turn which the public found disquieting. At times he seemed interested only in doing the impossible. If he won it would be despite himself; above all, it would be despite a 15 per cent GST on everything except food. The election was not quite a referendum on the new tax, but it was the dominant issue … It sustained us through the darkest times, all year long (p. 317).

Paul Keating won the 1993 election, defying not only the expectations of the Coalition parties and the media, but much of the ALP National Secretariat. Watson reports a phone conversation with Peter Barron saying that Keating would lose, and Labor Head Office would ‘rip the arm off’ of those involved in deposing Hawke for Keating, and those who had worked in Keating’s office (pp. 61, 346).

When decisions are being made about Paul Keating’s victory speech at the Bankstown Sports Club, Watson is on the side of expansiveness, and Russell on the side of caution. The result is the famous ‘True Believers’ speech, that simultaneously galvanized his supporters and drew his critics’ attention to qualities of hubris, arrogance and divisiveness. Watson observes that, with the ‘True Believers’ speech, ‘he might have still been campaigning’ (p. 354), and his retrospective reading of that speech is interesting:

For now and for some time afterwards the victory speech would be the guiding light, the inspiration, the high tide of our ambitions. When we were in doubt, we thought, we will have the victory speech to turn to. But Don Russell had been right. He [Keating] should have been more modest. The sound bite should have been more humble. Instead, only the opening line was remembered, and for much of the next three years we would battle the perception that the words meant his victory had only been for the faithful and the rest of the country can go hang (p. 354).

The 1993 election victory speech neatly captures the paradox of what Watson terms Keating’s ‘Horatius complex’ in leadership. His style was not to deal in shades of grey, but in a more ‘tribal’ style, where he needed to approach politics as a ‘constant state of war’, and to present his positions in ways that meant ‘the people were never in much doubt about where he stood’ (p. 225). It also meant that ‘Years of death-defying struggle had given him the metabolism of a cornered rat - he could not get excited until the stakes were very high, preferably a matter of life and death’ (p. 225). The problem was that people sensed his moods, ‘reckoned he stood against them, and that he cared little about their lives’ (p. 225). This problem became more apparent after he was elected Prime Minister in March 1993.