The next phase of Australian politics - the phase of consolidation

The Senate has now passed the policy trinity of:

• the final sale of Telstra;
• workplace reform; and
• the welfare to work initiative.

The final reforms that can be linked to the economic liberalisation of the Australian economy commenced in the 1980s and 1990s have been implemented.

2006 heralds the start of the third period of politics since World War II.

The period of Big Government

The first post-war period was the period of Big Government.

It commenced with the 1944 “14 Powers referendum” - an unsuccessful attempt to change the constitution to give it greater powers to influence post-war reconstruction, and the subsequent 1946 referendum - which successfully removed any doubt about the Federal Government's role in the provision of social services. This period concluded around the mid-1980s.

There was a general consensus among political classes that a post-depression, post-war government would impartially implement policies that were in the public interest. “Big Government” was put forward as a mechanism by which the greatest level of satisfaction could be provided to the greatest number. Therefore, so the story went, social programs were designed to assist those seen as “losers” in the community, although at a level that would not affect others detrimentally.

It was presumed that natural growth would fund government so it could take this central role.

Thus, income support was paid to people falling within various categories, with support available in many circumstances as a matter of right, not of need. Other schemes such as Medibank - universal health cover - were introduced. This increased role of government, built on elements of the so-called Deakinite settlement, were retained throughout most of the 20th century - particularly through devices like tariffs, quotas and the arbitration system.

The stagflation of the 1970s, and Australia’s stagnation in the early 1980s caused a review of this policy mix.

The period of market reform

The second political period was the period of market reform, which ran from the 1980s until now.

Again, there was a general consensus within the political classes that the power of government to change conditions had limits. Globalisation and the growing dynamism of the Asian economies meant that Australia had to restructure to ensure its economy could meet the challenges of the new world - and to afford the style of government to which the community had become accustomed.