Less than two months ago, political pundits spoke of the Coalition’s utter dominance. The Labor leadership question dominated federal politics, and many questioned the federal Labor Party’s future. Now, with evidence of a slowing economy, a soaring current account deficit, and a rise in interest rates, pundits are suggesting the Coalition is headed for trouble.
The recent AC Nielsen poll, showing Labor ahead by 52 per cent to the Coalition’s 48 per cent, fuelled this speculation and undoubtedly buoyed Labor’s spirits. However, the Newspoll released on March 22 shows the Coalition leading in the polls, with 54 per cent support to Labor’s 46 per cent, and suggests that current talk of a Coalition decline is as overstated and premature as talk of Labor’s irrelevance was then.
Recent economic news is causing the government discomfort, and further unfavourable figures may cause additional bleeding in the polls. However, an assumption that the Coalition will live or die on the continuation of Australia’s recent economic miracle ignores the fact that the Coalition has also succeeded by making serious inroads into Labor’s traditional areas of strength, such as health and education. If Labor cannot recapture its advantage in these areas, it faces an uphill battle.
In the election post-mortem, many commentators suggested voters were swayed primarily by their hip pocket. They may have trusted Labor on health and education, but economic management was the decisive issue. This allowed the Coalition to run a scare campaign on interest rates, and left them with plenty of money in the coffers for election year budget bribes. Understandably, this view resonated well with Labor party strategists and MPs.
The results of Newspoll surveys published in recent weeks suggest otherwise. A poll in late February asked whether issues were “very important”, “fairly important” or “not important” in determining an individual’s vote. Health and Medicare were rated “very important” by 82 per cent of respondents, and education by 80 per cent. By contrast, the economy was only rated “very important” by 70 per cent, and national security by 58 per cent. This is hardly consistent with the picture of a greedy electorate voting for the Coalition for their own financial gain.
The results do, however, shed light on Labor’s contemporary difficulties. Unsurprisingly, respondents preferred the Coalition by margins of 60 per cent to 20 per cent, and by 57 to 41 per cent, respectively, on questions of economy and national security. No news there. Yet, when asked which party is better able to handle health and Medicare, Labor was preferred to the Coalition by only 3 percentage points (40 to 37). Historically, Labor has held double-digit leads, leading by as much as 15 points in October 2003. Similarly, Labor’s lead on education was razor-thin: 40 per cent to the Coaltion’s39 per cent. This compares to a lead of 41 to28 percentage points in October 2003.
The results of a poll conducted March 4-6 and published last week, comparing the party leaders on these same issues, reinforce this trend. Howard is preferred to Beazley on the economy by 56 to 28 per cent, and on national security 62 to 24 per cent. Beazley maintains an edge on health and Medicare, but only by a margin of 43 to 37, and on education, by just 43 to 39 points. These results indicate that the Coalition’s ascendancy is built on more than just their dominance on economic issues. It also stands on their success in closing the gap in areas of traditional Labor strength. Labor needs to recognise this if they are to turn things around.
The reasons for the Coalition’s dominance on economic issues go without saying, but the narrowing of the gap on health and education issues offers interesting lessons for both parties. First, Labor’s big-ticket policy items in this area bear some blame - Medicare Gold, the schools funding policy, and the forestry policy all had problems. However, the decision to wait until late in the election cycle to introduce these items - leaving them insufficient time to be explained and communicated to the electorate - was also a significant factor.
The resurgence of the Coalition on the issue of health in particular, is a strong reminder of the advantage of incumbency. The government used its position to saturate the airwaves with adverts explaining the changes it made to Medicare, effectively campaigning under the guise of informing the electorate of services. Finally, the Coalition was successful in linking health and education to the economy - arguing that strong economic performance underpins the ability to pay for needed changes in health and education, and that without an ability to deliver it, promises in other areas are necessarily hollow.
Given their recent woes, nobody could blame Labor for the delight with which it is taunting the government with the array of recent figures showing a softening of the economy. However, Labor would be ill advised to believe it could ride to victory on the back of patchy news about the economic outlook. Even a well-conceived strategy to restore Labor’s economic credibility may not be enough for it to retake government. The Australian economy may slow, but it will not tank. Come 2007, the Coalition will still be able to campaign as the experienced, steady, economic manager, and characterise Labor as anything but this. The spectre of Labor’s last time in control of the Treasury Benches will loom over Labor again, and it will still be damaging.
Given this, relying on defeating the Coalition on economic issues is very risky. Rather, the Labor party needs to adopt a dual approach of reducing the Coalition’s advantage on economic issues, while restoring the electorate’s belief in Labor’s superiority on the issues of health and education. To do the latter it needs to reinvigorate its own policy, and point out that, for all the money the buoyant economy has provided the Coalition with to address these issues, big problems remain. Labor needs to start now. The clock is ticking.