Green Policies: Too Much Of Not Enough

It can’t be a coincidence: the worst examples of bad policy making and implementation in the last few years have been green policies.

The Federal Government has spent the last few months trying to neutralise the fallout from the home insulation scheme. And not totally successfully: last night’s Four Corners program uncovered even more prior warnings about the dangers of the Government’s policy. Kevin Rudd can’t fire Peter Garrett twice.

But don’t forget: the Government has also been embarrassed by problems with its solar panel subsidies. And its green loans scheme. And its National Green Jobs Corps.

There’s just something about the environment that leads politicians to abandon the basic principles of good policy making.

The Hawke Review of the Administration of the Home Insulation Program, released this month, found public policy essentials, like eligibility criteria, means testing and co-payments – that is, getting homeowners to put a little skin in the game by contributing some of their money – were conspicuously absent from the program.

Whether the program should have included co-payment was apparently raised in Cabinet. It was rejected.

And the Hawke Review found that advice to homeowners that they get at least two quotes for installation was abandoned before the program was fully launched. Recommending consumers follow basic market diligence was against the Government’s interests.

The Government still claims we had an insulation subsidy-led economic recovery. As Lindsay Tanner has argued: “I don’t think it’s right to say we should have sat back… dotting the i’s and crossing the t’s because we were in a crisis situation.”

There must have been a few more i’s left to dot. The cost of cleaning up the insulation scheme (around $1 billion) is nearly as much as the cost of implementing it in the first place ($1.5 billion was spent before the scheme was pulled).

By any standard, that makes the home insulation program an absolute debacle.

But the insulation program was perhaps not as much a debacle as the less-publicised green loans program. Under this program, homeowners could borrow up to $10,000 for four years to make sustainability improvements to their houses. The Government helpfully paid the interest on the loan.

Unsurprisingly, such generosity led to widespread rorting. The Government was forced to shut the whole thing down. Penny Wong announced last week that taxpayers are going to cough up another $4 million to audit the green loans.

Another policy fiasco: the solar panel subsidy scheme. That also had to be shut down early. It was supposed to cost $150 million. The final price tag is around $1 billion.

Then there is the Government’s National Green Jobs Corps. Apparently, when it announced it mid-2009, the Government didn’t actually mean to imply they would be green “jobs” – they’d be work experience for people getting Centrelink benefits.

I guess you shouldn’t judge a policy by its title.

Last year, Liberal MP Joanna Gash rightly described the green corps as “basically work for the dole with a green bent”.

But then in January Tony Abbott announced his own low-carbon copy – a 15,000-person green army.

Indeed, the Opposition’s direct action climate policy is swollen full of clever little green schemes. Twenty million trees will be planted. Grants will be provided for towns to convert to geothermal, tidal, and solar power. Rebates for home solar panels will be extended.

Abbott’s environmental centrepiece is an annual $1.2 billion emissions reduction fund. Companies which reduce their emissions below an individually determined baseline will be compensated. Those which exceed their baseline will be penalised.

The most important thing for a company will be getting a favourable baseline. Imagine how many opportunities there will be to game that system.

A report last week from the Commonwealth Auditor General found that state and federal governments are usually uninterested if their climate change policies are successful or not. The public accountability of individual environmental policies “has generally been poor.”

The Auditor General counted at least 550 separate climate change programs across the country, many of which were Howard government programs. We don’t really know which ones work. And if the ad hoc way bureaucrats report the results of their environmental programs is any indication, governments don’t seem to mind.

Obviously, it’s about green quantity, not green quality.

Could we expect anything else of policies which have ‘save the planet’ as their criteria for success? Public debate about the environment is characterised by emotion and ideology. Governments respond with the same.

The insulation program, the green corps, the solar panel subsidies, and the green loans program made stately headlines when they were first announced.

But the goodwill generated by those headlines doesn’t last when time reveals how poorly thought out the green policies actually are.

Taxation’s violent history

Any change in the tax system is a change in our relationship with the state.

But when the Henry tax review was released on Sunday, it was seen as a bit of an anticlimax.

The document has been sitting on Wayne Swan’s desk for more than four months. We’ve known about some of the big-ticket items for nearly as long: a simplified tax return system, and increased taxes on mining companies (presumably because Kevin Rudd hates Western Australia). We could have guessed some of the other ones: volumetric prices for alcohol. Since January, we’ve even known how thick the damn thing is: 10 centimetres of wonky glory.

But it’s definitely worth paying attention to.

In the relative luxury of twenty-first century Australia, it’s easy to believe government can never fail too badly – what could possibly go wrong with a few tax increases here and there?

But excessive taxation has been one of the great driving forces of history. Bad tax policy has destroyed industries, governments, nations, and empires.

Heavy taxes imposed by the Stuart monarchy led to the English Civil War. Dissatisfaction with Spanish taxes led to the Dutch revolt. Iniquitous taxation led to the French Revolution. And, of course, the cry of ‘no taxation without representation’ echoed throughout the American colonies as they rebelled against England.

High taxes can even be blamed for the fall of Rome. The economic deterioration in the third century AD which left the empire susceptible to external threat was to a large degree caused by skyrocketing taxes. Taxation was so heavy some free citizens renounced their liberty to become slaves, and therefore tax exempt. This was common enough for the Emperor Valens to declare doing so illegal.

In the early Middle Ages, taxes levied on infidels helped spread the Islamic faith – Muslim conquerors made it cheaper for conquered peoples to become Muslim than remain Christian.

Australia has its own violent tax history.

After all, it was excessive taxation which caused the Ballarat miners to rebel. They believed the increase in the price of a miner’s licence was tantamount to tyranny. This was particularly bitter for those who had left the Old World to find liberty in Australia. The Italian Raffaello Carboni wrote that he had travelled “16,000 miles in vain to get away from the law of the sword”.

So those anti-tax strikers at the Eureka Stockade had more in common with modern free marketeers than modern social democrats.

Even some of the great social movements were tax inspired.

In the United States, suffragettes in the 1870s formed women’s taxpayer’s associations and anti-tax leagues. In Australia, the women’s rights activist Mary Lee asked why “Should not those who had their property taxed have a voice in the representation of the taxpayers?”

Excessive taxation shows up in popular culture. The extremely high taxes of 1960s and 1970s Britain gave us The Beatles’ ‘Taxman’. In the Kinks’ ‘Sunny Afternoon’, the songwriters complain “The taxman’s taken all my dough”.

No wonder: the Labour Government in the 1960s imposed a massive 95 per cent “supertax” on high income earners. And the rich did more than just complain. Many, like the Rolling Stones, just packed up and left the United Kingdom altogether.

The proposed mining supertax will only be 40 per cent. But, like British rock stars, mining companies keeping a close eye on their bottom lines will leave Australia as soon as it is no longer profitable to stay.

Tax has an ignoble history.

But many people seem to view our tax system as a series of levers by which Australian society can be directed, and the choices of individuals can be manipulated. Increased taxes could shrink waistlines, eliminate traffic congestion, end lung cancer, and reduce drunken inner city violence.

In this view, taxation is not a necessary evil, but an end in itself.

Sure, the revenue from taxation can be used for good things. That money pays for public schools, the court system, police, national defence, maintaining roads, hospitals, and the welfare safety net.

But, don’t let the worthiness of some spending conceal the fact that the art of taxation is the art of plunder. To tax is to confiscate money which individuals and businesses have legally earned.

And, of course, the government wastes a hell of money too: the government ignored the overwhelming majority of the Henry tax recommendations, but the review still cost taxpayers $10 million.

The government’s new taxes won’t inspire revolution. And, luckily, they won’t leave us open to Visigothic invasion. But take the proposed tax on mining. It threatens one of our most valuable industries; one of the sources of Australian prosperity.

That should be more than enough to worry about. New taxes are a big deal.

Immigration and growth: 200 years of success

There’s a Rowan Atkinson sketch about a (pre-David Cameron) Conservative Party speech. In character, Atkinson starts talking about Indian immigrants: “I like curry,” he says. “But, now that we’ve got the recipe… is there really any need for them to stay?”

That combination of populism and affected naivety about immigration and population suddenly dominates our political sphere.

In Tony Burke, we now have Australia’s first dedicated Minister for Population. Under Tony Abbott, the Coalition is looking to make population growth from immigration into an election issue. The shadow immigration minister has called for a dramatic reduction in migrants. There’s now an opposition sub-committee dedicated to population.

And for what it’s worth, the Greens are instinctively hostile to anything that increases consumption within our territorial borders. More immigrants, economic growth, new products, cashed up bogans buying plasma televisions, anyone buying anything – whatever it is, they’re against it.

There is no force in parliament willing to embrace the benefits of population growth and immigration – historically, the two key drivers of Australia’s success.

It’s Kevin Rudd’s fault. In October he admitted publically what most Australian governments have believed for the last century – he believes in a “big Australia” and he “makes no apologies for that”. Since then, we’ve had six months of apologies.

Certainly, immigration itself presents policy challenges. But not that many. Australia isn’t a target for welfare-shopping: migrants can’t get the dole for their first two years.

And I’d be more concerned about the cultural challenges of immigration if we hadn’t had two hundred years of successful pot melting. Each migrant cohort is always more “different” than the last. And each cohort has successfully integrated into Australian society.

But when a politician expresses concern about population pressure, it is typically nothing more than a cover for government failure.

Take infrastructure. Will governments be able to supply enough roads and railways and community services for an expanding population? Well, that’s their job. To abrogate that responsibility is to admit that they are inept. They’ll have the money: more people means more taxpayers.

Or our high house prices, which are now being blamed on migrants and foreign investors. According to opposition housing spokesman Kevin Andrews, speaking to The Australian last week, his constituents are “saying their kids can’t get into the market because they go to auctions and are outbid every time by foreigners”.

Andrews was a former immigration minister (you might remember that) so clearly he’s playing to his favoured side. Nevertheless, Assistant Treasurer Nick Sherry has announced a “new enforcement crackdown” on non-residents buying houses.

House prices are inflated for a very simple reason: governments are choking land supply by restricting housing development at the edges of our cities. When demand increases but supply is limited, prices go up.

That’s the fault of those politicians now so concerned about population. Bob Carr is one of the most passionate advocates of population restraint. And his government was deeply reluctant to release land for housing.

So the idea that we don’t know where all these extra Australians will live is very peculiar. We’ve been expanding for two hundred years, and we haven’t run out of space to build houses.

Critics of immigration and population expansion present their views as brave contrarianism – they are the only ones willing to talk about the elephant in the room.

For such “straight talkers”, their case against population growth requires some awkward moral contortions.

Take the claim made by Bob Brown earlier this month: “skilled migrants, by the way, if left in their own countries, would help raise standards of living there”. This is the “brain-drain” thesis – that when the most educated poor people leave their home countries, they further impoverish the developing world.

But it should go without saying the major problem in the developing world isn’t they don’t have enough skills. It’s that they are underdeveloped. They’re poor.

Brown is telling people in poor countries they cannot seek to improve their lives, and the lives of their family.

That’s cruelty dressed up as kindness.

Well, it’s actually worse. Migrant workers send money to their relatives back home. These remittances add up to more than the world’s foreign aid budgets combined. And, unlike foreign aid, rather being funneled to governments, or distributed according to the preferences of first world donors, remittances go straight to the people who can use the money best.

So limiting skilled migration and chocking off remittances would add to third world poverty.

Migrants to Australia seek better lives than the rest of the world can provide. That should be flattering. They should not be used as scapegoats for the policy failures of our own governments.

Green Tea Party

Call it Tea Party derangement syndrome.

For the ABC’s Kim Landers, writing on The Drum a fortnight ago, the Tea Party Movement inspired thoughts “about the rise of One Nation and Pauline Hanson in Australia.”

And in the National Times in February, Bella Counihan speculated about the possibility of Hanson running as a Tea Party sponsored candidate.

The Tea Party Movement has been a force in US politics for more than a year now, arising in February 2009 to oppose George Bush’s extraordinary bailouts of the banking system.

But what seems to really perplex Australian commentators is the idea that an American grassroots movement could be against Barack Obama’s health care reform. Many Australians seem to imagine that being anti-Obama’s plan is same as being pro-death – how could people be protesting it?

But the Obama plan is less about ensuring free health care than making it illegal for individuals not to buy health insurance. And the plan eliminates many low-cost insurance options, compelling nearly a third of the country to switch to more expensive insurance.

So putting aside the occasional Tea Party hyperbole – Barack Obama is not literally a member of the Communist Party – being opposed to the health care legislation isn’t a priori evidence of craziness.

Pauline Hanson’s supporters had a scattershot animosity towards immigrants, aborigines, and greenies. The Tea Party Movement is concerned about a much more prosaic thing: the reckless spending of the federal government.

Certainly, George Bush was a massive spender. Of all the presidents since the Second World War, only Lyndon Johnson increased federal spending more than Bush did.

But Barack Obama makes Bush administration look cheap. His proposed budget for this year increases taxes by $3 trillion over the next decade. And his policies will increase the national debt will by $9.7 trillion.

Few areas of the federal spending are as out of control as health care. Obama’s plan will do nothing to keep down costs.

And the US government now pretty much owns General Motors.

Is being opposed to a massive transfer of wealth from taxpayers to bailout private banks and car companies, or being opposed to massive tax hikes and huge budget deficits, really the same as claiming that we’re being swamped by Asians?

The Tea Party was sparked by the extraordinary bailouts at the start of the financial crisis, but there has been distress within American conservative circles about uncontrolled government spending for some time.

Porkbusters was a campaign started in 2005, dedicated to exposing examples of government waste. Things like $1.8 million for swine odor and manure management research, and $50 million for an indoor rain forest for Iowa, slipped innocuously into an unrelated energy bill.

It was Porkbusters which exposed plans for the infamous “bridge to nowhere” – a federally funded, $398 million bridge to an island in Alaska that has fifty inhabitants and an airport. The island was already serviced by a ferry every half an hour. Sarah Palin campaigned on a “build the bridge” platform when she was running for Alaskan governor in 2006.

The bridge was cancelled. Palin now claims to be a born-again Tea Partier, dedicated to opposing pork in all its forms.

Clearly the movement has a quality control problem.

There is a belief that if Obama tackles immigration reform, the Tea Party movement will reveal itself as nativist and anti-immigration. But a recent survey of Tea Party members found their views on immigration roughly corresponded with those of the general US population.

That’s not to say there aren’t members who want to crack down on illegal immigrants. Tom Tancredo, a prominent anti-immigration Republican, addressed the Tea Party national convention in February this year.

Dick Armey (chair of the conservative group FreedomWorks and as close to a “leader” as the Tea Party movement has) is trying to keep voices like Tancredo out.

But worse again: the convention also controversially invited a ‘birther’ to speak, who wanted to ensure “signs saying ‘Where’s the Birth Certificate'” followed Obama everywhere in the 2012 campaign.

These distasteful elements are a direct result of the Tea Party’s lack of structure and leadership. On the one hand, the Tea Party is being courted by mainstream Republicans looking for endorsement. But on the other hand, fringe groups like the Larouchites, birthers, 9/11 truthers, and the John Birch crowd see the Tea Party Movement as a possible vehicle for their own message.

It’s messy. But it’s no more messy than the writhing mass of ideologies and agitators who comprised the Vietnam-era New Left.

There is one parallel between One Nation and the Tea Party Movement. Their members feel ignored and disenfranchised by politicians and political elites.

Both want governments to justify their decisions to the people.

That’s not necessarily a bad thing.

Who Should Run The Biggest Business In The Country?

Peter Garrett displayed “monumental incompetence” when it came to managing the government’s insulation scheme, claimed Tony Abbott in February.

Put aside for a moment whether Abbott is right.

The federal government spends nearly 28 per cent of our GDP. It’s the biggest business in the country. So imagine being Prime Minister. Imagine choosing who makes up your cabinet – who should be in charge of all that?

They’ve all got to be politicians with a spot in federal parliament. That’s the first major hurdle.

Skills that make someone an effective politician are not necessarily skills that make someone an effective manager of a national, multi-billion dollar enterprise.

It’s a rare preselection which takes into account a candidate’s capacity to run a large enterprise. The art of politics is the art of accumulating rank and power at the expense of others – not the first priority when looking for a capable manager.

Sure, everyone claims to have “leadership qualities” (parliament is full of future Prime Ministers) but few claim to be future executives.

Nevertheless, out of this less-than-inspiring crop of 226, you can only pick from your team. Labor has 115 MPs and Senators. And there are nearly 50 cabinet, ministerial, and parliamentary secretary positions to fill.

You have to take into account seniority and potential, youthfulness and senility. Then factions – you don’t want your controversial pick for the Parliamentary Secretary for Social Inclusion and the Voluntary Sector to be the reason you are rolled two years down the track.

And you’ve got to get the gender and geographic balance right.

All that is before you start considering who would actually be good at managing a government department. Or who is interested in the department you’d like for them. A parliamentary secretary for ageing in the Howard government reportedly once let it slip that he was less interested in his portfolio than his real “passion” – foreign affairs.

You have to hope that the best people are in the safe seats.

It’s a bad look for your government if at the next election you hold power but lose your three most important ministers in one per cent swing.

Choosing from such a limited pool, the question isn’t why ministers fail. It’s how they ever succeed.

So one of the weakest attacks you can make on a government is that it is incompetent – could you expect anything else? Oppositions like claiming the other side is incompetent because it implies they would do better even if they had the exact same policies.

That way, when the opposition identifies widespread failures, it need not undermine all the grand plans they have for their turn in power.

The Labor Party in opposition was no exception. They were fairly certain the Howard government was the most incapable, inept,and (lest-we-forget) most “out-of-touch” in Australia’s history.

But the Rudd government’s problem isn’t incompetence. It’s ambition.

In early 2009, the insulation scheme seemed like a small element of the Rudd government’s stimulus package, but, in retrospect, it was actually a pretty big deal. It is hard to imagine any government minister, no matter how skilled at policy implementation, could dump $2.7 billion into an industry and not have it flooded with dodgy operators out to make a quick buck.

Yet this was the whole point – funneling (presumably unemployed) workers into an industry which required little skill. In one stroke of a multi-billion dollar pen, the Prime Minister could save the economy and save the environment.

Over-ambition, not incompetence, explains why the government is still struggling to deliver its election promises. The school laptop program has still barely started, and the GP super clinics, and the childcare drop off centres. FuelWatch and Grocery Choice have been abandoned.

But it’s only by chance we’ve been able to peek behind the curtain to see other government policies which have been badly undercooked. was supposed to be a major health initiative – a forum for consultation where Australians can go with their ideas about the health system. But according to a whistleblower writing in The Sunday Age, it was done in a weekend; conceived on a Friday, released on a Monday afternoon.

And, as we learnt from the Godwin Grech affair last year, Ozcar – the “vital” bailout package of the automotive sector – was entrusted to a solitary, sickly bureaucrat, clearly in way above his head. Grech was the only one the Treasury Department put to work on it. So every time he took time off work, progress on the apparently essential bailout simply stopped.

These make the insulation scheme look like an exemplary model of policy implementation.

Dealing with policy failures is not a matter of shuffling around ministers, or even voting out governments. The surest way to avoid policy failures is to have fewer policies.

Liberal Leadership Aftershocks

The resignation of Nick Minchin last week is a reminder that the aftershocks of the late November leadership mania are still reverberating around the Liberal Party.
It was Nick Minchin’s role in the revolt against Malcolm Turnbull which sparked off the debacle that gave Tony Abbott the leadership. And the two men’s views on climate change are very similar.
But climate change isn’t the only issue in Australian politics.
The near fatal accident of Nick Minchin’s son was the trigger for his resignation.
But right now there is an underlying tension within the party over Tony Abbott’s paid parental leave scheme. And there is some speculation that Minchin, as one of the Party’s most stalwart Dries, was deeply unhappy with the abrupt change in the Coalition’s stance on the issue.
The paid parental leave scheme – funded by a tax levied only on Australia’s most profitable businesses – is anathema to the free marketeers within the party. It’s just not very ‘neo-liberal’.
Indeed, on the day the parental leave policy was announced one senior Liberal told The Australian’s Samantha Maiden, that such a scheme resembles “a typical 1930s socialist impost on big business”. This was before the senior Liberal learnt that it was Abbott who proposed it.
When Abbott said that parental leave would be instituted “over this government’s dead body” he wasn’t speaking for himself, but for the government. Abbott has different views. But opposition to parental leave was the view – still is the view – of much of the federal parliamentary Liberal Party.
So it might seem odd, but Abbott and the leader he overthrew are quite similar.
Like Malcolm Turnbull, Tony Abbott has a firm idea of the direction he wants to take the Liberal Party and the conservative movement. And as Malcolm Turnbull discovered before him, this may not be a direction the party wants to be taken.
The direction Abbott would like to take the Liberal Party is all set out in his book, Battlelines, point by point.
Nevertheless, in November, as the shadow cabinet faced an escalating series of resignations, no-one was pulling Battlelines down off the shelves to fully consider the pros and cons of Abbott’s philosophy of government.
Abbott’s book is a quirky mixture of policy, philosophy and personal chronicle – more fun than Peter Costello’s memoirs, but nowhere near as fun as The Latham Diaries.
It was seen as a curiosity at best.
Nobody in the party room was under any illusions about Abbott’s personal views, but neither did many expect him as leader to pursue each and every policy set out in his manifesto.
The alliance between free marketeers and the conservatives who supported (very un-free market) middle class welfare and family tax benefits was stable under John Howard – he spent his career traversing both the radical dry wing of the Liberal party and its conservative wing.
Certainly, Howard favoured one side more than the other. George Brandis said in his Deakin lecture last year that “For Howard, it was as much a conservative party as a liberal party; indeed, with the passage of time, rather more the former than the latter”.
But having been in the public eye for decades, Liberal free marketeers could still believe that Howard was one of them.
Unlike Howard, Abbott doesn’t want to straddle these two Liberal camps. Abbott, as “keeper of the conservative conscience” within the parliamentary party, sees government’s job to protect society from the bleakness of the market economy.
And instead of letting society flourish independently, as free marketeers would argue, Abbott believes government should actively build society in its preferred image.
As he told The Australian in March:
“You can’t run a decent society without a strong economic base… while I think it is important that the national government promote and develop a strong economy, it’s by no means the only or even, at every point, the main task of government.”
Abbott’s distinctly conservative approach is at odds with the other philosophical objective of the many in the Liberal Party – the primacy of the individual and importance of individual liberty. Launching Battlelines last year, Abbott made this explicit: “Individuals are only realised in a social context”.
So an Abbott government is not likely to be a small government.
If Tony Abbott personifies the conservative social-democrat side of John Howard’s legacy, then Nick Minchin personifies the radical free market side. Certainly, Minchin is big on “family values”, but for free marketeers, family values complement dry economic policies like low taxes and small government. For Abbott, family values trump those policies.
As many others have noted, Abbott’s vision of renewed conservatism with the Liberal Party is informed by fairly deep reading and reflection.
It is not, however, a vision uniformly shared within the party he leads.

The Ghost Of Liberals Past

Could the historical Robert Menzies be anywhere near as good as the Robert Menzies that exists in everybody’s minds?
Last week, Tony Abbott told a Sydney Liberal branch that the Liberals could win power if they embraced Menzies’ lessons – small government, and free markets.
This was, of course, a few days before he announced the super parental leave scheme, which will impose a substantial special tax on Australia’s most profitable businesses, in order to fund the middle class welfare policy to end all middle class welfare policies.
The Sydney Morning Herald’s political editor quickly damned the Abbott scheme, claiming that the opposition leader should have at the same time “apologised to the spirit of … Robert Menzies”, for abandoning his free enterprise ideals. To which The Australian quickly replied that Menzies was himself a big supporter of the welfare state.
During the Howard years there was an endless stream of columns claiming that John Howard had “betrayed the Menzies vision”. Or “abandoned his legacy”, as if Menzies would have crossed the floor against Howard, if only the passage of time had given him a chance.
Menzies is either a stick to be wielded against the modern Liberal Party, or a divining rod for seeking its future direction. But like a divining rod, those who use Menzies’ legacy are revealing more about themselves than about Menzies.
Nevertheless, when Bob Brown states on Twitter that “Tony Abbott’s new front bench makes Sir Robert Menzies look pink”, it’s a fair point. Menzies does look a little pink these days.
The post-war Menzies government was centralist enough to be a blank slate upon which anybody can impose their ideal vision of the past. Well, at least it was centralist by the standards of the time. With the hindsight of half a century, the Menzies government was a protectionist government, supportive of high levels of regulation, restrictive industrial laws, and, most damningly, the White Australia Policy.
So if Menzies really was a free marketeer, he certainly hid it well. The Australian economy in the middle of last century had levels of interference that would make the Greens blush.
The Menzies government was better than its predecessor, which tried to outright nationalise the banking system. But the conservative victory in 1949 was no breakthrough for free-enterprise, despite the subsequent myth making.
Trade policy is an obvious indicator of a government’s philosophical beliefs. And on free trade, Menzies looks very bad. With the possible exception of 1950 and 1951, when import controls were temporarily lifted in response to American demand, Australia’s markets were tightly regulated by the federal government, with import licensing and quota restrictions meant to protect industry from dastardly foreign competition.
After more than a decade of conservative government, those import restrictions were lifted in 1960, and the work of micromanaging the economy was left to tariffs. But it was Gough Whitlam, of all people, who started the real work of opening the Australian economy to the world, when he cut tariffs 25 per cent across the board.
We have a habit of thinking that being right equates with success, and being wrong equates with failure.
But just because some certain political leader was successful – and Menzies certainly was successful, if measured simply by years on the job – doesn’t mean they are an idol against which we should measure our values. If right-of-centre Australians want to evoke the spirit of their philosophical ancestors, they’d do better to remember their glorious failures.
Take the nineteenth century politician Bruce Smith, Australia’s answer to the great British liberals Richard Cobden and John Bright.
Smith wrote Liberty and Liberalism, a manifesto of free trade and small government, which the Australian Dictionary of Biography helpfully describes as ‘anachronistic’ because he believed in limiting state interference in the economy. (Economic liberty is so just so … old-fashioned.)
Smith fervently opposed the White Australian Policy, arguing that the “foundation of the [Immigration Restriction] bill was undoubtedly racial prejudice”. Smith’s liberalism was remarkably modern: “I venture to say that a large part of the scare is founded upon a desire to make political capital by appealing to some of the worst instincts of the more credulous of the people.” He should have just said “dog-whistle”.
Smith was a big supporter of business. He helped found and direct the Victorian Employers Union in 1885 and the New South Wales Employers’ Union in 1888, as a response of business to the growing trade unions.
Or we could consider George Reid, who was the first and only Free Trade Party Prime Minister. Or Bert Kelly, the “modest member” who was a dedicated supporter of free trade within Menzies’ government, and anticipated the liberalisations of the 1980s and 1990s.
Modern political parties are welcome to celebrate the achievements of their former leaders. But if they need philosophical inspiration – and they do – they’ll have to look elsewhere.