Busting political cartels and limited visions

Kevin Rudd and Malcolm Turnbull’s recent forays into essay writing, as well as Tony Abbott’s latest book show how politics in Australia is trapped between opposing, but outdated visions of public policy.

The Prime Minister wants to spur long-term growth but places too much faith in bureaucratic big government solutions and underestimates the social benefits of markets, choice and devolved responsibility.

Turnbull and Abbott understand the importance of markets and choice in service delivery but don’t give enough attention to whether meaningful choices are available to poorer individuals and families.

The Liberals tend to underestimate the important role for government investment in education and health and the role of regulating a carbon price market for protecting the global environment.

A third position, based on the values of empowering people through participation, has growing support in Britain from both the centre-right and centre-left of politics that transcends these divisions.

It is founded on trust as the basis for forging stronger communities and economies and a more resilient people. Trust that people get ahead when they hold meaningful choices. Trust that public officials, teachers and health professionals can be empowered to make decisions less encumbered by red tape and meaningless targets for their own sake.

It is more than the “invisible hand” guiding progress it is a faith in people rather than government dictates. It doesn’t argue for smaller government as an end in itself but it does argue for a government that is more agile, efficient and focused.

If implemented in Australia it could be at least as radical as the deregulation of the early 1980’s with as many long-term benefits.

This politics has a profoundly different vision for public service delivery to that of Prime Minister Rudd. The devolvement of power away from the hands of government control to local providers is essential for greater choice and the tailoring of public services to the needs of people.

Differential voucher funding for education and the promotion of a mixed delivery of public and private involvement in public services is vital for giving people more choice over how they access the ladder of opportunity.

Schools are the perfect example of services that should be devolved to the local level and given greater opportunities to innovate and offer tailored services within the framework of a basic, flexible national curriculum.

The Liberal party has made it easier for middle class parents to exercise school choice but have been blind to the fact that choice cannot be exercised by those poorer parents that most need that choice and have no option but to send their children to failing schools.

And while Labor understands the need to focus more attention on the disadvantaged it supports excessively bureaucratic delivery mechanisms underestimating how much poorer parents and children would benefit from having access to greater school choice.

Promoting participation in the economy is where this politics comes into its own.

It is not left wing to support participation enhancers like childcare nor to support the right for union representation in the workplace as long as it’s governed by laws promoting work and productivity.

It’s not right wing to impose mutual obligations on the unemployed nor to support more wage flexibility if equity can be better achieved through tax and transfer measures.

While Howard’s WorkChoices emphasised greater individual choice in employment contracts it was too deaf to the distributional implications.

Yet the ALP does not understand that businesses should not be the instruments for achieving society’s equity goals without their being significant employment consequences.

Employment Minister Julia Gillard’s bizarre recent criticism of the Fair Pay Commission decision to freeze minimum and award wages during a period of weak labour demand shows how blinkered the modern ALP is to this reality.

A focus on participation would retain liberalised employment arrangements, including moving over time to less binding minimum and award wages, but would offset the distributional implications with a proper system of earned income tax credits or a guaranteed minimum income through a negative income tax.

This policy seeks full employment and no compromise on this goal. This is a very powerful rhetorical position for any leader.

This policy has been argued for by both the left and right in economic circles and has begun to be branded as a Jobs Guarantee by left wing economist Bill Mitchell from Newcastle University who argued at a recent Liquor Hospitality and Miscellaneous Workers Union conference for a minimum wage pay subsidy as the optimal policy for this union and its members. This is little different from a negative income tax in practice.

Innovation policy is another area where participation politics shines above the approach of trying to pick winners. It argues that innovation happens through the actions of all business when they have access to more educated staff, efficient tax and regulatory frameworks, and rarely through industry plans. It argues that we can all benefit from the creative destruction of the market as long as significant income and training support is made available to help workers adapt to the pace of change.

The ALP must be weaned off its addiction to command and control solutions. It is possible to support carbon abatement through market-based mechanisms like an emissions trading scheme without having to directly support particular producers and technologies.

This politics is complemented by reform to the political system as well. When we hear stories from the last Iowa caucus in the US Presidential campaign, it is clear that Australia also has an untapped potential for political participation renewal.

Thousands of men and women of all ages, races and colours turned up to local town halls and schools and literally voted for their Democratic or Republican candidate by standing, in the case of Democrats, in the Obama corner or the Clinton corner of the room. Votes would be counted and those that turned up could rightfully claim a small piece of history.

This politics is a long way from the tightly closed factional deals of the New South Wales Labor Party or the events and lobbying rewards afflicting Queensland politics at present.

Local primaries for candidates, whether Liberal or Labor, would radically change the outlook of the political parties and give those people who are currently apathetic a say in the candidates in their seats without having to join the party they favour.

A recent broad-based primary by the Tories in Britain in the seat of Totnes had a turn out of nearly 25 per cent or more than 16,000 votes.

Importantly these primaries require aspiring politicians to connect with community issues. A system that rewards involvement in neighbourhoods, schools, businesses, churches, policy forums and even unions would provide for a popular candidate choice from a broad range of backgrounds for the public.

As an example of the change primaries could bring for the Liberals, climate change deniers would be more marginalised in the Coalition under broad-based primaries as general opinion dominated the pre-selection debate on the subject.

Candidates like Wilson Tuckey would struggle in broad-based primaries outside very remote locations and this would assist the Liberals to reform and present better to the electorate. This would be good for the Liberal party and for overall candidate quality.

Participation will bust the political cartel that is now limiting Australian policy options if only politicians can trust people more.

If this does not happen it’s likely a third force, supported by efficient businesses and a broad church of swinging voters, will emerge to challenge the current hegemony.

Let’s hope so!