Who killed reform?

By David Donaldson

October 12, 2018

The age of reform is apparently dead, but there isn’t much agreement about who killed it.

There’s a whole cottage industry in the Australian media lamenting the lack of reform and asking how we can return to it.

Previous governments brought down tariffs, floated the dollar and created the GST.

Yet governments of the past decade — the Rudd-Gillard-Rudd-Abbott-Turnbull-Morrison years, if you like — have struggled to pass changes and make them stick.

In his book Dog days: Australia after the boom, economics professor Ross Garnaut nominated the year 2000 as the end of the reform era, giving way to a “great Australian complacency”.

This has led to a build up of internal imbalances in the economy that will make it difficult to respond to future shocks.

On Thursday he conceded there have been three big, difficult government interventions since then — WorkChoices, the response to the global financial crisis, and the carbon price.

But the negative response of the mainstream media to those efforts will create a barrier to future reforms, he told the Outlook Conference.

Cash-for-comment economic modelling, allowing private interest to maraud as public interest, has undermined public debate about policy, Garnaut believes.

He also identifies a decline in independent voices in the public discourse, arguing we need to nurture independent policy institutions.

Yet despite the power of the “majority media” and business lobby in controlling the agenda, they largely haven’t gotten what they want out of politicians, and have created public distrust, Garnaut argues.

He didn’t say which media outlets he was talking about, however. The conference is co-hosted by The Australian newspaper and the Melbourne Institute.

…or are politicians to blame?

Former treasurer Peter Costello rubbished the idea the problem is structural.

Many blame social media, or the 24-hour news cycle. Costello is not convinced. Media is “just a channel” that can be pro-reform or anti-reform, he argues.

The failure to win a majority in the Senate is another bugbear. Former PM Tony Abbott even proposed a constitutional referendum to stop the Senate being a “house of rejection”. Yet the Howard government managed to get things done despite lacking a majority for most of its tenure, Costello said.

“A majority in the Senate is the exception, not the rule, and I don’t think you can blame that.”

And we often hear out-of-control partisanship is wrecking governments’ ability to rule. Again, this argument leaves Costello cold. Politics has always been contentious.

“There was never a great deal of bipartisanship in Canberra,” he argues.

“It’s much more banal than that. I think the issue is that politicians are not quite sure what the change they want is.

“If you want to deliver change you’ve got to know what you want. And then you’ve got to argue for it, and then you’ve got to convince the public.”

In his day it was clear that the Liberal party was about lower taxes and smaller government. The so-called left and right factions didn’t exist, according to Costello’s recollection, and social questions didn’t dominate.

“The one thing you could ­always unite the Liberal Party around in my time was the ­economy,” he said.

He noted that one of Malcolm Turnbull’s arguments against Tony Abbott when he challenged for the leadership was that the government had no economic narrative.

Costello agreed this was a problem — but then not much changed.

“I kept on waiting for the economic narrative to come, and I’m not sure that it did.

“I think that is the problem today, I’m not sure what the narrative is amongst those who are making these decisions for us,” he said.

If Costello is right, it’s down to the individuals in the system, not the system itself.

But, as one frustrated audience member suggested, across so many policy questions there is disagreement not just about how to solve the problem, but what the problem even is.

So perhaps reform isn’t really dead, just on hiatus. Maybe.

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