The Little Engine Who Could - Kim Beazley, John Howard and the Great Debate

On domestic matters the worm turned decidedly against the Prime Minister. The GST is still a negative, as is the sale of Telstra. When the PM tried to tie the GST into state funding of health and education, the swinging voters just switched off and the worm headed for Antarctica.

On domestic issues the Prime Minister appeared to have two problems. The first was that his policies are not seen as being effective. When Kim Beazley asked the audience if they thought they were better off now than they were 5 years ago, the worm emphatically said "No". The Liberal Campaign is partly a "Don't risk it" one. But if people aren't happy with what they've got, what are they risking by trying another? The second is that he has no third-term agenda. At the moment he is running on his record, and despite what I have said about electors voting against politicians rather than for them, you still have to provide some basis for hope and a next term agenda. Otherwise voters will have trouble voting for you, even if, as in the case of Jeff Kennett, they are fundamentally happy with your achievements.

What does this debate say for the rest of the campaign? In the first place it is hard to see the Prime Minister avoiding a second debate. How can he tout his leadership credentials if he appears to be running away from conflict with an opponent who has just bested him? It might be sensible to steer clear of another blood nose, but it will look like cowardice. It may even undercut the symbolism of his trip to APEC. Rather than an exercise in leadership it may well look like an exercise in avoidance. The pressure will become even greater after the release of the Budget Charter of Honesty. And the Prime Minister may well decide he needs another shot at Beazley at that stage. This last debate was easy for Beazley - he wasn't the one with anything to lose. Next time might be different.

Secondly, the Liberal Party is going to have to produce a third term agenda, and it will need to have substance on the key issues of education and health. It isn't regarded as being as capable as the ALP in those areas. In the areas where it is regarded as being more capable, such as the economy, the worm seemed to be saying that swinging voters felt threatened by the achievements of the government rather than reassured. This is a huge problem because it means that the government needs to abandon its strengths and try to compete in the areas where the opposition is seen as being strong.

Despite the Great Debate, Howard is still the favourite to win, but Beazley has plenty of opportunity. This is a long election campaign, and holding the debate at this stage will make it seem even longer. 1984 was a long election campaign, and Bob Hawke as Prime Minister was widely favoured to win. In the end he was almost beaten by Andrew Peacock, who in fact won more than 50% of the votes, but less than 50% of the seats. He did it by doggedly sticking to his lines and the messages that voters wanted to hear. Beazley has the same task. Howard can wrap himself in the flag and proclaim that he is a leader. Beazley has to keep doing an impression of the little engine that could. Will "I think I can" overcome "I am"? Only time will tell, but the little engine is starting to get up a head of steam.