Bottom Drawer

Bottom Drawer

End the Labor scab-picking

7 March 2015

9:00 AM

7 March 2015

9:00 AM

There is an awful feeling of déjà vu with Federal Labor at the moment. Flicking through the Latham Diaries reminds you that when in Opposition and up against a struggling government, it settles for the typical. Whether post Howard or post Abbott, Labor becomes, well, just Labor. Quick to abandon critical policy development and new thinking for what Latham correctly describes as ‘scab picking’ politics, unfortunately this seems to be the DNA of so called modern Labor.

Who knows, this may be where modern politics has now morphed. Scab picking replaces policy making. The never being able to say you agree with government, irrespective of whether if you were in their position and subjected to the same advice or circumstances, you would probably do the same thing. Ah yes, when you’re faced with nothing else to say or nowhere else to turn, you can always pick the scab by calling for compassion. Because as we all know, the national interest is always better served by the sweet lightness of compassion rather than the difficult doing of fixing things for the better.


Although Labor say they are the party of Hawke & Keating you’d be hard pressed to find much of Labor’s great men in them today. Apparently, the Hawke/Keating tradition doesn’t extend to privatisation, shrinking government, introducing means testing or income contingent loans. Listen to Labor today on university funding and you would be hard pressed to recall that it was Labor that introduced HECS and it was Dawkins that rationalised higher education institutions. So too, the aged pension. Wasn’t it Hawke Labor that introduced the assets test for the pension? Support for anti electricity privatisation campaigns? Hang on, let us not mention that it was Keating that established the then Industry Commission review into electricity provision and it was Keating that cheered as Kennett privatised the electricity businesses and was given Federal competition rewards. Tax reform? Keating reduced the top marginal rate, not once but twice, and aligned the top rate of tax to the company tax rate. So, after a meagre effort to play copy cat in 2004, Labor is now quite happy to say nothing on income tax reform and worse still, allow pernicious bracket creep to fund the Commonwealth budget. Ask yourself this. If the current Shadow Ministry had been calling the shots in the 80s, facing the issues Hawke and Keating did, where would we be now? You’d be hard pressed to see Shorten and his team deregulating exchange, capital or labour.

It’s all enough to remind you of the story recounted in the Latham Diaries itself. Latham recalls a lunch with Paul Kelly from the Australian at his home where Dr John Edwards, now of the Reserve Bank board but formerly in the Office of Keating, recounted a classic Keating story. After returning from a Caucus meeting when he pushed through a deregulation policy, according to Edwards, Keating remarked ‘Yeah, I got them to agree to it, but they don’t really believe in it’. Yep, that sounds about right today as it did back for Latham in 1998. Unlike 1998, when Labor did all it could to bury the Hawke/Keating legacy, at least today Labor says it is proud of the tradition. But it takes some doing to be able to say you are proud of something when deep down, in your heart of hearts, and in your policies you are more Calwell than Keating. Labor in the 1980s used to worry about where the money is coming from. These days it worries where the money isn’t going.

For a generation of Labor supporters that grew up with the Hawke/Keating years we may just need to come to terms with an inconvenient truth. The high water mark for Labor economic policy was in the 1980s and like a statistical outlier we may never witness Labor of those years again. Maybe just maybe, like all statisticians will tell you, after time, outliers regress to the mean. And what we see today is Labor as it has always been. A party concerned with the inevitable losers of change and unable to prosecute the case for the national interest. A party prone to scab picking while direct action is needed. A party of tax and spend when economic dries are needed.

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Alex Sanchez is an economist and former advisor to Mark Latham.

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