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Liberals - whither goest thou?

By Des Moore - posted Thursday, 24 September 2009


On workplace relations generally, the Opposition appears to have been slow in predicting the virtually certain problems likely to arise from Labor’s re-regulation of employer-employee relations involving the transfer of quasi-monopoly power to the unions as well as to quasi-judicial institutions who under the pre-1996 arrangements consistently brought down decisions favouring unions and neglecting lower skilled workers. Indeed, despite the ample evidence available, until very recently Minister Gillard was given virtually a free ride to sell the absurd line that the new legislation would increase productivity and that there would be no more employer “rip-offs”. Nor did anyone seem to question her view that the supposed “rip-offs” were the payment to a relatively small number of employees of wages below rates determined under awards made by the quasi-judicial institution that (once again) has showed itself incapable of setting wages on an economic basis, let alone on a basis fair to the lower skilled. The awards that provided the basis for the rip-off allegations were wide open to questioning that never eventuated.

That Gillard was allowed to get away with this presumably reflected the defeatist view taken by the Liberal Party, and promulgated by both Labor and (naturally) the biased media, that this was what Labor won in the election and was entitled to implement. But leaving aside the impossibility of identifying specific election mandates (debate continues on why the Howard government lost), the Liberal Party lost an enormous opportunity for exposing the many serious potential problems with the legislation and thereby laying the ground work for the components of a future Liberal policy.

At the very least the Coalition should by now have promulgated a view that, whatever the position in the distant past, the Australian labour market is not susceptible to exploitation in any meaningful way. The fact that over 800,000 employers compete for labour prevents dictation of conditions by employers because employees have alternative opportunities. Indeed in a normal year well over one million workers leave their jobs voluntarily. Such facts are available for all to see and could have been used by Turnbull to explain the rationale for a policy supporting individual contracts.

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Global warming is the other main issue on which the Opposition has presented a weak policy position and on which Turnbull has been tortoise-like in failing to recognise the importance of developments since he became leader. I have already written about these (and associated aspects) in greater depth in Quadrant Online (see "Global science or global panic?") and will limit my comments here.

My exchanges with Turnbull when Environment Minister under Howard suggested his position on global warming was a pragmatic one and, on that basis, recent developments should have led him to change the ready acceptance under Howard of an emissions trading policy. These developments include the widespread increase in expressions of sceptical and dissenting views by expert scientists and others, the increased exposure of mistaken analyses by the global warming believers (including by “expert” advisers to Minister Penny Wong), the shift to majority scepticism in opinion polls in the USA and the continued cooling in recent years signalling that there is no need for urgent action. Indeed Rudd’s postponement of the start of an ETS provided an opportunity for Turnbull to adjust his approach. Yet neither Turnbull nor any of his ministers seem to have been able even to raise questions about any of this. Does Turnbull have the national interest in mind or might he be kow-towing to a Business Council whose membership appears to have a (majority) self-interest in an emissions trading policy?

At the very least these opportunities should have led to a policy stating that any decision by the Government on an Australian emissions reduction policy should be delayed until after the Copenhagen outcome could be assessed. It is totally absurd and irresponsible for the Prime Minister of Australia to say Australia will go ahead regardless of whether there is a meaningful global agreement and it is difficult to believe that Rudd could pursue a double dissolution election with that hanging over him and with the other developments reinforcing serious doubts about the science and urgency. Turnbull could have also - still could - used the advice to Senator Fielding by four expert Australian scientists that an inquiry needs to be held into the science because “proper due diligence … can only be achieved where competent scientific witnesses are cross-examined under oath and under strict rules of evidence”. Would Rudd fight an election over a delay by a Senate seeking a proper inquiry into the “large uncertainties in the science” publicly acknowledged by Professor Garnaut?

Consistent with Alan Oxley’s analysis in his excellent Stan Kelly lecture of September 17 (A call to arms - the threat of Green protectionism), another possible opportunity for Turnbull would be to put Rudd on the spot by seeking his agreement that an essential condition of any international ETS be that the rules governing the international trading system remain substantively unaffected. As Oxley also points out, the potential for threats to that system to develop, and the “normal” lengthy time taken to conclude any international negotiations, makes it likely that any negotiations on a global climate change agreement would be long drawn out. Given Rudd’s strong support of international “co-ordination” (but the apparent unreality which he accords to prospective results) why hasn’t he been pressured by the Opposition to, for example, set criteria for Australia’s acceptance of an international agreement? Now Rudd is acknowledging that Copenhagen is unlikely to produce a meaningful result -another reason for delaying any decision on an Australian scheme. Another lost policy opportunity for Turnbull?

It is difficult to avoid the conclusion that the Liberal Party has lost its way and is failing to recognise the challenges to the role of the individual in society and indeed to the role of independent private enterprise. Rudd’s portrayal of himself as “conservative” has turned out to be completely misleading. Through a wide variety of policies - ranging, to mention just a few, from the large government spending reaction to the recession, the supposed education revolution aka government spending, the protection from dangerous warming via (only) a government determined emissions reduction scheme, international co-ordination by governments, increased environmental protection by government, to increased assistance to the arts - Labor is presenting government as the driver of society and the solver of society’s problems. Rudd’s initial (unsuccessful) summit and his Cabinet meetings outside Canberra reflect this approach.

As mentioned above, this is consistent with a new political thesis suggesting that governments are establishing relationships with those it identifies as important groups (“stakeholders”) in society in ways that make it essential for government to be involved in almost any decision-making. In an article in American Spectator for September 2009, Professor Codevilla (International Relations at Boston University) gives as an example an election statement by (now) President Obama that “I’m going to get everybody around a big table where all can express their views and their needs. And I’ll express mine, and that will make sense of them all because I’ll be president”.

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Little wonder that Obama’s “big table” approach has produce anger from many individual Americans who resent being told what to do and what not to do - and who are not included as stakeholders by a Democrat President. Codevilla argues that this approach is not confined to America.

The reaction to Obama’s “stakeholder” philosophy in America has been a drop in support in polling and increasing difficulty in obtaining approval for legislation despite his Democrat majority. Here Labor’s policies, which like Obama’s include unions as stakeholders, have yet to see any similar reaction in Australia. Whither goest thou Liberal Party?

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First published in Quadrant Online on September 20, 2009.



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About the Author

Des Moore is Director, Institute for Private Enterprise and a former Deputy Secretary, Treasury. He authored Schooling Victorians, 1992, Institute of Public Affairs as part of the Project Victoria series which contributed to the educational and other reforms instituted by the Kennett Government. The views are his own.

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