Government in a time of crisis

Everyone knows that the coming federal election is an unusually important one. Australia has undergone dramatic change under the Coalition’s policies, and the poll will tell whether the electorate has seen enough and wants a change, or more of the same.

But this election will be important for another reason as well. It will elect the first government since World War II whose major concern will be managing a national and international crisis. The crisis this time is caused by the onset of global warming and oil depletion, two results of a century of increasingly global mass-industrial development.

The fast approaching enviro-resource crisis will utterly transform global conditions, and Australia is more vulnerable than most countries to its effects. Whether or not our governments get cracking and respond with a sense of urgency will largely determine how much hardship we must endure. With luck, it will be a transitory period after which things will settle down again, but if we get it wrong, it will be merely the start of very hard times indeed.

Australians have been shocked to find that climate change has suddenly presented us with a water shortage and the prospect of steep price increases in basic necessities. The national accounts, so long the report card of government, already reflect these changes as inflation and interest rates are affected. The economic effects have been somewhat disguised by the economic boom in China, but this can’t last and once it falters the true situation will emerge.

Australia faces real problems on almost every front. Our basic needs, food and water, are threatened by weather changes and our reliance on cheap oil. Our sprawling, massively capitalised cities face growing disruption as oil prices rise, and oil and gas become increasingly hard to get.

Our regional and rural areas face disaster as the transport infrastructure fails. The tourist industry, always vulnerable to shocks, will collapse. The insurance industry will put up premiums until it just gives up. Real estate values will get jittery as weather and rising sea levels take effect. Eventually all this will flow through to the finance sector and a heavily leveraged economy will start to totter.

Internationally the resource scarcity will generate new tensions as the US, Europe, Russia, China, Japan and India manoeuvre to control the declining resources and to also avoid the costs of climate change. Australia will be increasingly squeezed between the behemoths China and the US as the Pacific Rim destabilises.

The growing flood of environmental refugees as extreme weather and rising sea levels devastates places like Bangladesh and the Indonesian islands, if not handled by some globally negotiated program, will see Australia turn into an armed camp.

Whoever wins the next election will have to deal with these and other challenges as they begin to take shape. We pretty much already know what the coalition will do: align increasingly with the US and follow their lead on international matters; avoid doing anything to disrupt the economy, as they narrowly define it, until the last minute; promote big industrial solutions, like nuclear power, and rely on market-based approaches like carbon trading.

What Labor would do is more uncertain. Would Kevin Rudd opt for business as usual and attend to narrowly defined economic issues, as indicated by his ‘economic conservative’ claim? Or would he reconceptualise the crisis in terms of national development with lots of big projects to strengthen national infrastructure? If the latter, his balanced budgets promise will soon disappear as the economy weakens.

We should make no mistake about this: a Coalition government or economically conservative Labor government will be a disaster for Australia. They would put off responding to the crisis until it is too late, and the price for such inaction will be very high indeed.

The only rational response is a strong program aimed at dealing with the emergencies while also effecting longer term structural changes. At the same time on the international level Australia needs to promote collective security through openly negotiated programs.

Interestingly enough, this is similar to the problems faced by Australia in the 1940s as prolonged depression and world war threatened to tear apart western civilisation. Australia, which has always been heavily reliant of the global economy, had been hammered by the Great Depression and faced annihilation by an implacable foe in Imperial Japan.

The country was led by a party still loyal to the fading British Empire and which believed in supporting business and farmers, and not much else. The alternative was a Labor party that could hardly stop squabbling long enough to mount a serious challenge.

We were lucky then. Genuine leadership emerged in the Labor Party, led by John Curtin and Ben Chifley, and the conservatives, bereft of ideas and knowing it, played along. We shifted our attention from the old power, Britain, to the rising power, the US. We defeated the Japanese army in New Guinea, removed the threat of invasion and went on to play an important role in winning the world war.

Even before war ended Labor began planning for a new era. The vulnerability made so plain in wartime led to a series of economic programs which dovetailed with Labor’s commitment to social justice, while mass immigration was also encouraged. Both the social and physical infrastructure of the nation was rebuilt, resulting in new housing, better education and health services, and iconic schemes like the Snowy River Project.

Internationally Australian politicians took a lead role in creating new collective security and finance organisations, notably the United Nations, the IMF and the World Bank. These bodies did not reach their real potential as the Cold War took shape, but they were epochal break-throughs nonetheless.

The great crisis of the last century, in the form of depression and war, arrived and was seen off, and Australia emerged stronger than ever. Our isolation and vulnerability were overcome by a willingness to act for the common good in times of trouble. Led by men who commanded respect, Australians were asked to think big and work together, and we did.

In the face of this new crisis, we need to respond in the same way. We need to rebuild our social and physical infrastructure to make us a more flexible and capable country. We need to recover social solidarity to ensure the costs of the crisis and the responses to it are shared fairly. We need to rebuild government as the central process in society, genuinely democratic and led by the best people we have.

We need to present ourselves as an example of how a rich western country can go green, and we need to play our part in global negotiations as an independent nation that will, nevertheless, act cohesively with all with the others to achieve a viable result.

If we do all these things, we might just squeak through, but the real work must begin with the next election. Crunch time approaches, and we will need the smartest and most hard-working governments we have ever had to manage the great changes to come.