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We are all socialists now, but weren’t we always?

By Scott Prasser - posted Thursday, 3 February 2022

Before the 2007 federal election I posited that 'Australians are all conservatives now' (The Australian, 20 April).

It argued that thanks to years of reform by Coalition and Labor federal governments, whoever won the election did not matter 'because during the past two decades conservatives have won all the key policy battles … Australia is on a one-way street of more deregulation, market-based reforms, greater global integration, and less welfarism'.

Even the Rudd-led Labor opposition in the run-up to the 2007 election preached financial austerity and called on the Howard government to be financially prudent in an election year.


We had, it seemed, made a welcome and permanent break from the Australian tradition of the 'protective state' characterised by government interventionism, extensive public-owned enterprises, agricultural marketing boards, an over-regulated financial sector and labour markets, and what Geoff Blainey labelled 'regulationism'.

How wrong can you be!

Such economic reform that laid the foundations of our recent prosperity turned out to be but a brief aberration. Within a year in office, the Rudd government's fiscal discipline collapsed in its spending over-reaction to the Global Financial Crisis. Industrial relations reform was wound back, and tax reform shelved. Government overreach was everywhere. The Rudd administration lost its nerve as well as its way. Australia reverted to type; squibbing hard policy choices, losing the reform momentum, lapsing into budget recklessness, and appeasing vested interest groups.

The protective state was back in business.

The succeeding Coalition governments of Abbott, Turnbull, and now Morrison have been little better. Elected on a surfeit of cliched slogans parading as policies and promises to cut nothing, the Coalition largely failed to deliver promised budget surpluses. Vital industrial relations reform was 'dead, buried, and cremated'. Overdue changes to federal-state relations system were shredded. Apart from two tax cuts, the majority of needed tax reform was shelved as too hard. Energy policy was outsourced to international agreements and bodies.

Labor, back in opposition, has quickly forsaken its former economic reform mantle, returned to the bosom of the now vastly shrunken but self-interested union movement, and meted out the same harping intransigent behaviour they got from the Coalition when in office.


The pandemic has accelerated these trends.

Australia's responses have been increased government interventionism and regulations, and the expansion of our welfare safety net – all supported by huge budget deficits and borrowings.

Responsibilities and key decisions have reverted to the states with each pursuing their own narrow interests.

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This article was first published by The Spectator.

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About the Author

Dr Scott Prasser has worked on senior policy and research roles in federal and state governments. His recent publications include:Royal Commissions and Public Inquiries in Australia (2021); The Whitlam Era with David Clune (2022) and the edited New directions in royal commission and public inquiries: Do we need them?. His forthcoming publication is The Art of Opposition reviewing oppositions across Australia and internationally. .

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