The purpose of this comparative analysis was to argue that a national leader’s legacy should be assessed with reference to the entirety of their political career as opposed to focusing on the senior position(s) that they have held.

A Comparison – Menzies and Costello

The announcement in June (2009) that the former Treasurer and former Liberal deputy leader Peter Costello would not re-nominate for his federal seat of Higgins effectively ends his political career. Whether the axiom of the controversial former British politician Enoch Powell -that all political careers end in failure – is applicable to Peter Costello, is unclear.

The potentially negative consequences of the Costello departure can be illustrated by a comparative analysis of his political career with that of the great Australian statesman and Prime Minister (1939-1941 and 1949-1966), Sir Robert Gordon Menzies (1894 – 1978).

This comparative analysis of Costello’s political career with Menzies’ has been inspired by the uncanny similarities and the glaring differences between the two men with regard to their sense of public service. Particular emphasis has been placed on why Menzies’ career constituted a success by an analysis of where Australia might be now had he not committed himself to serve in a political capacity.

Both Robert Menzies and Peter Costello came from lower middle class backgrounds. Menzies was born in the Victorian country town of Jeparit in 1894. Although his father and grandfather had served as Members of the Victorian Parliament, the family’s circumstances, while comfortable, were relatively modest, as Robert Menzies father supported his family as a storekeeper. Costello was born in 1957 and raised in the eastern Melbourne suburb of Blackburn. His father was a Baptist Minister.

Both men had excellent tertiary educations. Their respective university experiences would be seminal in determining their future political careers. Menzies studied law at Melbourne University between 1913 and 1916. During this period, he served as President of the Student Representative Council and as editor of the student newspaper. His prominence in university affairs was doubtless aided by the absence of many men serving during World War I. (Costello’s university experiences will be analysed later in this article).

The decision of the Menzies family that Robert should not serve in the war was understandable because two other brothers were already fighting on the front. Unfortunately, but predictably, given the at-times mediocre nature of politics, Menzies’ decision not to serve in World War I would be used against him in his political career. Had Menzies served and lost his life in the war, the consequences for Australia would have been very adverse because the impact of his subsequent political career was to have very important and positive outcomes for Australia. Menzies’ sense of duty would later manifest by his decision to forgo a potentially lucrative legal career in order to pursue a political one.

During his time at university, Menzies developed a great respect for the British legal system. As a result, he had a positive approach to being a conservative in that he conceptualized politics as being about supporting the existing social-political system and thereby serving the public good. Menzies manifested this outlook as a staunch monarchist. He unconditionally supported the British monarchy in response to the British Crown underwriting the viability of the Australian Constitution (which Menzies deeply respected) and also as an institution whose viability is predicated on public service.

Menzies and Costello: Differing Perspectives on Industrial Relations

The future Australian leader practiced as a lawyer following his admission to the Bar in 1918. Menzies demonstrated that he was a positive conservative by winning two landmark cases in the early 1920s representing trade unions. These legal victories of Menzies helped ensure that trade unions could, by invoking the inter-state federal powers of the Australian Constitution, represent their members’ interests. The legal precedents which were set in these two cases were vital to ensuring that Australia’s embryonic system of industrial relations became operative.

Australia’s emerging system of industrial relations was formulated in the early years of federation (Australian federation occurred in January 1901). The passage of the landmark Conciliation and Arbitration Act 1904 (the 1904 Act) helped establish an Australian industrial relations system which led the world. Under the 1904 Act, an institutional framework was formulated in which the respective employer interests and the employee interests (as represented by trade unions) could be represented in a fair and even handed manner.

The cornerstone of the 1904 Act was the establishment of an industrial relations tribunal – the Conciliation and Arbitration Commission (the Commission) – which arbitrated between capital and labour. The Commissions’ landmark 1907 Harvester Judgement (delivered by the Commission President, the great Sir Henry Bourne Higgins) guaranteed a minimum wage based on a worker having the capacity to support their family. Australia’s emergent system of industrial relations was one of the great political achievements of the nation’s founding fathers and had the support of both Labor and non- Labor federal politicians.

Costello, similar to Menzies, left his mark on Australian industrial relations in the period between his university graduation and his entry into parliamentary politics. As a barrister in the mid-1980s, Costello represented employers in the land mark cases of Muginberri, Dollar Sweets and Robe River. The key industrial relations issues in these important industrial cases concerned union pickets and work practices. The legal victories that Costello achieved not only challenged union power but, in a broader context, facilitated future employer hostility towards the continuance of the arbitral system of industrial relations established in the early days of federation.

To promote employer hostility to Australia’s arbitral system of industrial relations, Costello helped found the H.R. Nicholls Society in March 1986. This Society was backed by anti-union employers and companies, notably the multi-national Western Mining Corporation. The purpose of the H.R. Nicholls Society was to terminate award protection and centralized wage fixing and ultimately deny the capacity of employees to be represented by unions. (This society was named after a newspaper editor, Henry Richard Nicholls, who had disgracefully attacked the integrity of Justice Higgins).

The Australian union movement’s peak industrial representative body, the Australian Council of Trade Unions (ACTU), under the leadership of Bill Kelty, supported the Hawke and Keating ALP governments’ industrial relations agenda undertaked in the 1980s and 1990s. This support entailed the union movement endorsing new practices, such as enterprise bargaining, in order to aid economic reform. Nevertheless, prominent members of the H. R. Nicholls Society, such as Peter Costello, still maintained an uncompromisingly hostile stance toward the Australian union movement, which ultimately envisaged its removal from the Australian industrial relations system.

Union endorsement of industrial relations reform (which diluted the institutional arbitral supports that unions had previously utilized) warrants mentioning because it reflected the fact that the Australian union movement, in the main, was prepared to support the continuance of a pluralist industrial relations system which accommodated both employer and employee interests. The H.R. Nicholls Society and supporters of its unitarist philosophy, by contrast, not only rejected unions as a legitimate party to the industrial relations system but also rejected the principle of employees having basic employment and bargaining rights.

The industrial relations policies initially espoused by the H.R. Nicholls Society were vigorously pursued by the Howard government (1996-2007). Given Costello’s major role in Howard’s government and the stridency of ministers such as Peter Reith (Employment and Workplace Relations Minister, 1996 to 2001), this was not surprising. The anti-union stridency of the Howard government was both manifested and crowned by its passage of the Workplace Relations Act 1996 and Work Choices 2006. The latter legislation went so far as to effectively abolish minimum award standards for wages and employee entitlements and specifically placed restrictions on what conditions unions and/or employees could negotiate.

As uncompromising as the Howard government was in industrial relations, Costello stood out for believing that its IR ‘reforms’ did not go far enough! In this regard, Costello’s attitude was similar to that of the post-Menzies Liberal Party which is yet to recognize that its founder (before he commenced his parliamentary career) was one of the key players in consolidating Australia’s pluralist system of industrial relations. Consequently, the capacity of the contemporary Liberal Party to facilitate social action has been severely constrained by its strident anti-union bias. Costello’s failure, or reluctance, to continue with Menzies’ pluralist approach to industrial relations, constitutes a fundamental disconnect between the two men.

The constructive approach which Menzies adopted with regard to industrial relations was evident in his earliest overt involvement in politics. Due to his previous industrial relations successes, Menzies had a thriving law practice and his reputation ensured that he had the opportunity to enter politics if he so chose. In an important milestone in Menzies’ life, he forewent his lucrative legal career to enter parliamentary politics. He was first elected to the Victorian upper house in 1928 and transferred to the lower house of the Victorian parliament in the following year.

The fact that Menzies was prepared to ‘stay the distance’ and endure the ups and downs of a state and then a federal parliamentary career between 1928 and 1966 was signalled by his foundation of the Melbourne based Young Nationalists Organisation (YNO) in 1929. The YNO was a grass roots activist organisation whose members organised public meetings in which issues of concern were raised and viewpoints expressed. Although no-one knew it at the time, the YNO would later fulfil a vital role in preventing Australia from descending into political extremism.

Menzies’ support for the YNO was the first indication of the impact that he would have in ensuring that the non-ALP side had coherently organised political parties. Even before Menzies had founded one of Australia’s two major parties in 1944, the Liberal Party, he had already helped sustain the party he had originally joined, the Nationalist Party, through the YNO. He would also be instrumental in founding in 1931 a successor party to the Nationalists, the United Australia Party (UAP). Indeed, Menzies was unique among non-Labor Party founders in that he had neither a prior trade union or an ALP background!

Australia’s Embryonic Party System 1901-1917

At the time of federation in 1901, the ALP- due to the support it received from trade unions- was the closest approximation to Australia having a coherent political party. The two political groupings that initially dominated Australian politics in the previous century were the rival Free Traders and the Protectionists. Neither of these two groupings were political parties as the non-ALP federal parliamentarians lined up on the then defining issue of free trade versus protection.

A sense of distinction between these two groups was endowed by the titanic leadership tension between George Reid of the Free Traders and Alfred Deakin of the Protectionists. This leadership tension was underpinned by the rivalry between Australia’s two biggest cities, Melbourne and Sydney. (Reid and Deakin were respectively based in Sydney and Melbourne).

The issue of free trade versus protection was essentially fought out over arbitration. The Protectionists prevailed by aligning with the ALP to pass the 1904 Act. Reid’s departure from federal parliament in 1908 saw the leadership of the Free Traders pass to his self-effacing deputy Joseph Cook who took his group into a merger (the ‘Fusion’) with the Protectionists in 1909.

Fusion went into the 1910 election as the ‘Liberal Party’ and was paradoxically strengthened by the ALP election victory. This came about because the embryonic Liberal Party’s defeat facilitated the departure of Alfred Deakin and the ascent of the unassuming Cook to the party leadership. Cook was effectively the founder of the first Liberal Party because his leadership bridged the previous tensions between former supporters of Reid and Deakin. As a former trade unionist, Cook supported Australia’s emerging industrial relations system based on arbitration.

In the early years of federation, the ALP was fortunate to have outstanding leaders in John Watson and Andrew Fisher. During this formative political period, Australia was free from Catholic-Protestant political sectarian rivalry as the ALP was originally an alliance between Catholic and Presbyterian unionists (Cook had originally being one of the latter). This religious unity would be later consciously shattered by ALP Prime Minister, Billy Hughes.

World War I: The Politics of Division

Wars and armed conflicts can be times in which a sense of national emergency fosters national unity. This was not the case with Australia during World War I. Hughes, as Prime Minister, called two divisive referenda (held respectively in 1916 and 1917) on conscription. The prominent opposition of the Irish Catholic Archbishop of Melbourne, Daniel Mannix, to conscription endowed the referenda with a religious dimension which polarised Australian society on Protestant and Catholic lines. (Both referenda permitting conscription were fortunately defeated).

The sectarian divisions which conscription generated spilled over into the ALP. Hughes and his minority of predominately Protestant supporters split from the ALP to merge with the Liberal Party to form the Australian Nationalist Party in February 1917. Hughes’ political position was strengthened by the sectarian nature of the split because Protestant voters previously with the ALP overwhelmingly passed over to the new Nationalist Party. The strength of the ruling party was initially and unfortunately based on sectarian divisions within Australian society.

Hughes’ tenure as Prime Minister (1915 to 1923) might have been longer had he not later alienated sections of the Nationalist Party by pursuing interventionist policies. A group of Nationalists previously loyal to Cook broke away in 1920 to form a rural based party which eventually became known as the Country Party. This new party won the balance of power in the 1922 elections and agreed to enter into a coalition with the Nationalists if they replaced Hughes as Australian Prime Minister. This condition was met and Stanley Melbourne Bruce became Australia’s new Prime Minister.

Democracy Safeguarded 1929- 1931

In 1929 Prime Minister Stanley Melbourne Bruce moved to abolish the Commission. To their credit, Hughes and his supporters within the Nationalist Party crossed the floor to defeat the legislation. Considering the fact that pro-arbitration tendencies existed within the Nationalists, Bruce may have intended to lose this vote so that he could call an early election which he in turn knew he would probably lose.

Bruce’s actions seemed strange but they were probably undertaken on the basis that he could finally rid himself of Hughes and that he would eventually return to office. The latter assumption was based on the premise that the ALP, under James Scullin, would be unable to cope with the monumental challenges posed by the onset of the Great Depression that year. Bruce’s calculation that he would have returned to the Prime Ministership would probably have been correct had he not lost his own seat in the 1929 federal election.

With the benefit of hindsight, Bruce’s actions were highly irresponsible. The Nationalist Party was decimated and a fascist threat to Australian democracy in the form of the AAL subsequently emerged in the void. This threat to Australian democracy between 1929 and 1931 is still little understood or appreciated.

The Nationalist Party was only a loosely organised political party. It had a negligible branch structure and an over-reliance on big business donations to sustain it. The organisational void within the Nationalist Party allowed the All for Australia League (AAL), a veterans based group, to emerge in 1931 as a potential opposition party or even a potential ruling party. The AAL was a New South Wales/Sydney based political organisation and its impetus resulted from the deep antipathy that many World War I veterans felt toward the then New South Wales Labor Premier, Jack Lang. The AAL had authoritarian tendencies as many of the war veterans who rallied to it considered those who opposed them to be unpatriotic.

The political situation was not helped by chronic divisions within the Scullin ALP government. These divisions centred on the rivalry between the Treasurer, Ted Theodore and the Post Master General, Joseph (‘Joe’) Lyons. Theodore was opposed to undertaking deep budget cuts demanded by British creditors while Lyons reluctantly accepted them.

The problems arising from the Lyons/ Theodore division were compounded by the emergence of the ‘Lang Labor’ group within the federal parliament. This group was loyal to Jack Lang and supportive of his call for the Australian government to repudiate its international credit obligations. The vibrancy of Lang Labor, combined with the organisational weakness of the Nationalist Party, potentially fuelled the rise of the AAL.

The unsung hero who effectively thwarted the AAL’s rise was the then federal opposition leader, John Latham. After Scullin supported Theodore over Lyons, the latter, at Latham’s invitation, crossed over to the Nationalists with a small group of ALP MPs to constitute the United Australia Party (UAP). In terms of the Labor Split of 1931, the number of Lyons’ supporters who crossed over to the UAP was insignificant. The real source of the 1931 ALP split was the departure of Lang supporters to form their own party in federal parliament.

However, the defection of Lyons (who came from Tasmania) to the UAP opposition provided Latham with the necessary momentum to entice war veterans and other possible AAL supporters in New South Wales, who were motivated by a strong hatred of Lang, to join the new UAP instead of the AAL. The UAP under Lyons won the federal election held at the end of 1931.

In Victoria, the UAP could not have been viable without the support of Menzies’ YNO. During this period of great socio-economic dislocation, the state of Victoria was fortunate that the YNO existed as a functional grass roots activist organisation. This was particularly important because the Nationalists were organisationally such a weak party whilst extremist groups such as the Communist Party were active.

The YNO effectively became the dominant grouping within the new UAP Victorian government formed by Stanley Argyle in 1932. As a result of the YNO’s influence, Menzies became Deputy Victorian Premier in 1932. In 1934, much to Argyle’s relief, Menzies transferred to the federal parliament after being elected to the blue –ribbon seat of Kooyong.

The Lyon and the Cub 1934 – 1939

In a situation later similar to that of Costello, Menzies entered federal parliament with a strong Victorian power base already in place. As a result of this power base, Menzies was elected UAP deputy leader and appointed Attorney-General on entering federal parliament in 1934. Menzies at this point was naturally tipped as Lyon’s successor. However, even before entering federal parliament, Menzies had already made a positive impact on Australian politics by facilitating the establishment of a viable non-Labor party and government. This was a positive achievement because it countered the extremist threats posed by the AAL and Lang Labor.

The strained political relationship (1934 to 1939) between Menzies and Lyons had uncanny parallels with that of Howard and Costello following the federal coalition’s third consecutive election victory in 2001.

Menzies’ influence within the Lyons government was undermined by the disproportionate power wielded by the Country Party as the junior party in the coalition government. Country Party leader (and founder), Earl Page, held the positions of Deputy Prime Minister and Treasurer. (Menzies, as Prime Minister in 1958, transferred the position of Treasurer from the Country Party to his Liberal Party). Furthermore, due to his meteoric rise, there was already a strong anti-Menzies wing within the UAP from the time of his entry into parliament. To compound Menzies’ woes, leadership tension soon arose between him and the seemingly amiable Lyons.

The Lyons UAP government provided a functioning government during a time of profound economic crisis but little else. His government was acceptable to the public primarily because of deep affection toward the Prime Minister who cut a reassuring and emphatic figure as a former union official who had risen from humble circumstances. The Prime Minister’s Roman Catholicism was also another source of popularity because it seemingly put an end to the sectarianism that the conscription split had previously precipitated.

The government’s negligence with regard to defence needs left Australia perilously unprepared for the coming of World War II in September 1939. With the benefit of hindsight, it was fortunate and understandable that Menzies resigned in March 1939 from a decomposing government. Whether Menzies would have ascended to the Prime Ministership had an overwrought Lyons not suddenly died in early April 1939 is an open question. Even with Lyons’ death, Menzies probably would not have succeeded Lyons had the already decaying UAP not closed ranks behind him because of Page’s (who was serving as caretaker Prime Minister) vicious attack on Menzies for not having served in World War I.

The Politics of Decomposition

Menzies first stint as Prime Minister (1939 to 1941) is generally considered a failure and he has been unfairly criticised for having put Britain’s interests before Australia’s. This criticism was given credence by Menzies’s prolonged absences in London and rumours that anti-Churchill elements within the British government were looking to Menzies as an alternative British Prime Minister. However, it should not be forgotten that Menzies was not Prime Minister when Australia came under threat from Japan and his concern for Britain was then shared by most Australians.

As Prime Minister, Menzies did his best with a mediocre cabinet to lead Australia during war time. The Menzies government probably would not have been narrowly returned in the September 1940 election had it not been for internal divisions within the federal ALP. Indeed, the Menzies government was actually returned as a minority government, reliant upon the support of two country independents.

The fatal descent towards which the UAP was seemingly heading Australia became apparent when a majority of the cabinet demanded Menzies’ resignation in August 1941 following his return from a four month period in London. The Country Party then took advantage of this sudden discord to demand that a joint party room elect a new Prime Minister.

Due to UAP’s chronic weakness at this time the ostensibly senior coalition partner ceded the prime ministership to the Country Party leader, Arthur Fadden. The UAP then glaringly confirmed its slide into oncoming oblivion when it elected an aged Billy Hughes as its new leader. (Incredibly, Hughes had almost beaten Menzies in the 1939 UAP parliamentary ballot to choose a successor to Lyons).

The new Fadden government thankfully fell after two months in office when the two independents holding the balance of power shifted their support in October 1941 to the ALP leader John Curtin. Rather then face an early federal election, Fadden wisely allowed the ALP to assume office and allowed the new government to serve out the full parliamentary term which ended in 1943.

Between 1941 and 1943, Fadden served as opposition leader and Hughes was able to hold onto the leadership of the UAP by refusing to convene a federal parliamentary caucus meeting. As a result of Hughes’s grossly ineffective leadership, the UAP’s state branches split and reformulated into a bewildering array of parties and groupings. The UAP entered the August 1943 election more as an umbrella group than as a political party and was only remotely viable because it was attached to the Country Party which was still a coherent political party.

Menzies Supports Curtin at the Crucial Juncture

Prior to his fall from power Menzies had informed Curtin, that his leadership rival, Herbert Vere Evatt, had covertly approached him – Menzies – to support the proposal that an all party national unity government be formed. Such an arrangement probably would have saved Menzies’ faltering Prime Ministership but he refused to enter into it.

This act of political statesmanship on Menzies’ part undoubtedly cleared the way for Curtin to assume the nation’s leadership at a crucial time and to lead it during the dark period when the fall of Singapore to the Japanese in February 1942 seemingly heralded Australia’s imminent fall. As a still prominent politician, Menzies supported Curtin’s forging of an alliance with the United States in 1942 when the UAP, under Hughes’ leadership, was publicly prepared to abandon the northern half of Australia to Japan due to a desire to give first priority to the war in Europe.

The Politics of Survival 1941 -1944

In the meantime, Menzies decided to stay on in parliamentary politics despite being mooted as Britain’s Minister of State in South East or as the Australian Minister (ambassador) in Washington. This latter position was offered to Menzies by a grateful Curtin who may also have been aware of the advantages of having the only potentially viable non-ALP leader abroad. The former Prime Minister also had the opportunity to return to the law and have a potentially lucrative legal career. Menzies’ decision to stay on in public life, despite the probability of failure, was to be the making of him.

Had Menzies abandoned politics following his fall from power, the ALP may have assumed the status of the dominant ruling party, i.e. one which is entrenched in power due to the absence of a viable opposition. (A stand out example of a dominant ruling party in a developed western democracy has been the Social Democrats in Sweden).

In a pattern reminiscent of his role in the YNO, Menzies in effect formed a ‘party within a party’ when he founded the National Service Group in March 1943 among his UAP supporters in federal parliament. Had it not been for the National Service Group -and Menzies conducting a de facto national campaign for the August 1943 election on their behalf- then the UAP may have been wiped out altogether or have been superseded in number by Country Party MPs.

Although the UAP was returned as a rump with only twelve seats, it still came out ahead of the Country Party (which won seven seats) and was therefore able to reclaim the role of senior opposition party, which precipitated a temporary break up of the coalition. Because the UAP’s rules required that a meeting of its parliamentary wing be held following an election, Menzies was able to retake the party leadership from Hughes and become opposition leader.

In assuming the role of opposition leader, Menzies seemed destined for political failure because his party was too divided and discredited and Menzies was himself considered to be a political loser. However, Menzies already had sufficient foresight to realize that a new non-ALP party could reach out to an untapped power base. This foresight had been evident in 1942 when Menzies coined the term, the ‘forgotten people’. The term was more than political spin.

Menzies realised that there was a significant number of people in Australian society, such as housewives and small businessmen, who were neither represented by unions or by big business. It was these ‘forgotten people’ which Menzies would later tap into to found a new political party which would precipitate his Lazarus type of political resurrection.

The Politics of Renewal: Menzies Founds the Liberal Party in 1944

In stark contrast to Costello, Menzies considered opposition to be a golden opportunity for renewal. As such, he utilised the moribund UAP as a launching pad for a new non-ALP alternative party. At Menzies’ instigation, state branches of parties which had once belonged to the UAP such as the New South Wales based Democratic Party and the Queensland based People’s Party were invited to a conference in Canberra in June 1944 to formulate a party constitution for a new party. Grass roots groups such as the National Women’s League and representatives from the Melbourne think tank, the Institute for Public Affairs (IPA), also participated in the Canberra organising conference.

The June 1944 Canberra Conference was successful because Menzies’ insisted that the future party have a coherent and vibrant party branch structure in which the constituent groups would be subsumed into the new political party. This party took the form of the Liberal Party of Australia and was formally launched at its inaugural conference in the New South Wales town of Albury near the Victorian border in December 1944. Menzies was also determined that the new party would not repeat the fatal mistakes of the preceding Nationalists and UAP by having to be over-reliant on big business donations to compensate for having only a weak branch structure and organisation.

Menzies’ achievement of forming a new and viable opposition party seemed destined to be just that, founding a new alternative political party. At this time, there looked to be little prospect that the new Liberal Party could win office for the foreseeable future. This was due to the high regard in which the ALP was held as a result of its astute handling of the war effort. The Liberals also faced a seemingly insurmountable barrier due to the magnitude of the ALP’s 1943 landslide election victory. Furthermore, Ben Chifley, who had succeeded to the Prime Ministership on John Curtin’s death in July 1945, was held in high regard due to his personal integrity.

The belief that Menzies could not win a federal election was apparently borne out by the 1946 federal election results when the Liberals failed to win enough seats to seemingly place them in contention of winning in 1949. (The ALP was returned with a seventeen seat majority). In political circles, it was thought that the Liberals would still fall short in 1949 and that Menzies would be replaced as opposition leader by the then Liberal Party Federal President, Richard Casey.

That the Liberals under Menzies went on to a federal election victory in 1949, (in coalition with the Country Party), was primarily due to Chifley’s determination to nationalize the banks. The ALP government’s policy of retaining war time controls, such as petrol rationing, was also a source of profound public unease. With the war’s end, there was a strong public sentiment to dispense with war time austerities.

Another major problem which confronted the Chifley government was that of communist instigated strikes in essential industries. The federal government went so far in 1949 as to send troops to work in the coal mines to counter communist strike action. Although the Chifley government courageously countered communist inspired industrial unrest, middle class unease was still generated. This unease was substantially compounded by the government’s bank nationalization policy and its refusal to remove rationing controls. This deep unease was sufficient to deliver victory to the Menzies led coalition in the December 1949 federal election.

Menzies’ Return to Power – 1949

From the very outset of his second tenure as Prime Minister, Menzies cleverly asserted his authority. He resisted strong pressure from his party to replace public servants with Liberal Party supporters. This action won Menzies the gratitude of the public service which had previously worked closely with the ALP federal government. Public service support was a considerable source of personal power for Menzies as there was still a hostile sentiment toward him in the Liberal Party which was a carry- over from his previous period as Prime Minister.

While securing the support of the public service, Menzies simultaneously moved Australia to a new policy paradigm. Within twenty-four hours of becoming Prime Minister, he removed petrol rationing. This action, along with the lifting of other rationing controls (which were carry-overs from the war), effectively scuttled the then emerging statist approach to policy which the ALP with the support of the public service had been engineering.

The lifting of rationing controls removed barriers to Australia’s post-war growth. Two substantially positive policies of the Chiefly government,–the massive Snowy Mountain hydroelectric scheme in New South Wales and the post-war immigration program-were continued. These were also drivers of economic growth and prosperity in the 1950s and 1960s.

A policy of industry protection was implemented by the Menzies government. This policy is now, ironically, anathema to the contemporary Liberal Party. However, economics is not an exact science and economic policies need to be formulated and implemented according to the then environment. In the 1950s and 1960s, tariff protection was conducive to attracting foreign investment and, subsequently, to generating and sustaining employment growth. Indeed, from the mid-1950s until the election of the Whitlam ALP federal government in December 1972, there was full employment and low inflation in Australia.

The Menzies government also pursued progressive social policies. The federal government assumed responsibility for higher education which led to the expansion in the 1960s of university education for the baby boomer generation. Due to the influence of women within the Liberal Party (which can be traced back to the pivotal role of the Women’s National League in founding the Liberal Party), pro-women family friendly policies, such as child endowment, were implemented.

Australia’s Place in the Sun: Australian Foreign Policy under Menzies

This new government built on the previous ALP government’s foreign policy accomplishment of forging an alliance with the United States which helped ensure that Australia became an important and respected world player. Contrary to popular myth, Australia during the Menzies era engaged with Asia as European colonialism disintegrated. This was reflected by Australia’s important role in founding the anti-communist South East Asian Treaty Organisation (SEATO) in 1955.

Australia also emerged as a major figure in international affairs during the Menzies era due to its role in the Commonwealth of Nations. Menzies fulfilled a conspicuous leadership role in the Commonwealth in the 1950s and 1960s which helped the Commonwealth become the most important inter-continental international organisation after the United Nations.

The importance of the Commonwealth first became apparent in world affairs during the period of confrontation between Indonesia and Malaysia in the years 1963 to 1965. From 1959 onwards, Indonesia’s President Sukarno pursued a pro-Communist China foreign policy which entailed him attempting to destroy the new Malay federation. Australia and India utilized their Commonwealth connections to support Malaysia. Australia’s action in standing with Malaysia created considerable goodwill throughout non-communist Asia.

The military support which Australia provided to Malaysia against irregular Indonesian insurgents in Malaysia during the Confrontation era was a decisive factor in countering them and undermining Sukarno domestically. General Suharto’s rise to power in 1965 ended the threat of a communist takeover. (The Indonesian Communist Party, the PKI, was then the world’s third largest in 1965 after China and the Soviet Union).

Australia also utilized its traditional links with New Zealand to forge a tripartite alliance with the United States in 1951, the Australia, New Zealand and United States Security Treaty (ANZUS). The ANZUS alliance was initially promoted by Australia and New Zealand to keep the United States engaged in Asia following the end of its occupation of Japan in 1951.

This alliance would later be destroyed by the short sightedness of David Lange (New Zealand Labour Prime Minister from 1984 to 1989) in denying the right of American nuclear armed ships to enter New Zealand ports. Former Australian Prime Minister Bob Hawke observed in his memoirs that one had to be cynical when calls were made to award Lange the Nobel International Peace Prize. Hawke knew that the anti-nuclear policy was pursued by Lange to placate the left wing of the ruling New Zealand Labour Party so that the government could pursue radical free market economic policies.

Critics of the foreign policy of the Menzies era, such as former ALP Prime Ministers Whitlam and Keating, asserted that Australia ignominiously failed to engage in Asia due to non-recognition of Communist China. However, western engagement with Communist China was not a viable option until President Nixon’s 1972 visit to Peking demonstrated that mainland China was prepared to help non-communist countries counter Soviet power.

The focal point of Australian engagement in Asia in the immediate post-war period hinged on Australia forging economic ties with Japan. A stand out achievement of the Menzies government was concluding a trade treaty with Japan in 1957. In contemporary Australia, this accomplishment may not seem unusual because Japan is now a vitally important trading partner. But, in the 1950s, there was still considerable anti-Japanese sentiment and it took considerable courage on Menzies’ part to enter into a trade treaty with Japan. This treaty in turn was invaluable in helping Japan gain trading access to Asian markets. (Contrary to popular opinion, Japan is still Australia’s most important trading partner).

Menzies’ foreign policy achievements were not trumpeted at home by him because he was secure in the fact that his domestic policies were successful. He was able to convert his domestic successes into political capital by developing and harnessing the support of Liberal Party branches. Up until the 1980s, it was not unusual for small businessmen to regularly set aside time to attend their Liberal Party branch meetings and commit to supporting its activities. Women were often elected to party branch positions and gained a considerable degree of power. Eminent members of society, such as research scientists, often joined branches and this reflected the Liberal Party’s then close connection to the community during the Menzies era.

The Merlin Effect: The Importance of Liberal Party Branches

The strength of party branches at this time had a Merlin type of positive impact on the Liberal Party. Instead of the party declining as it continued on in office, the reverse happened. As time progressed, Menzies benefited from the branches injecting new blood into his party and, in the process, letting go of non-performing MPs.

A considerable source of branch effectiveness was that the right to preselect candidates remained the sole preserve of branch members. Consequently, there were instances in which the campaigning commitment of local branch members was the determinant behind sitting MPs in marginal seats (most notably Sir James Killen in 1961) being re-elected.

Due to the fund raising successes of branches, the Liberal Party also avoided the pitfalls of the preceding Nationalist Party and UAP of being unduly beholden to big business. The overall gauge of Liberal Party organisational effectiveness was the absence of party factions due to the primacy of rank and file members. This organisational effectiveness also transferred to the Liberal Party at a federal parliamentary level where there was an absence of inner- party factions. At a state level, with the exception of Queensland where the Country Party was the senior coalition partner, the Liberals up until the 1970s tended to win parliamentary elections.

The 1955 Evatt Purge

The Liberal Party’s success during this period coincided with cataclysmic self-generated decline of the ALP in organisational terms. On losing office in 1949, the ALP was still in organisationally sound shape. Its comparative strength was due to having an engaged rank and file base among affiliated unions that spilled over into party branches.

This union rank and file activism was the by-product of ALP Industrial Groups (the ‘Groupers’) who effectively countered communist infiltration of trade unions. As a consequence of the 1916 Split the Groupers were overwhelmingly Roman Catholic. From the early 1940s Groupers formed industrial workplace based groups which operated within union branches. The ALP Industrial Groups opposed communist infiltration and promoted social action by fighting to ensure that unions represented their members’ interests.

Grouper union leaders such as Laurie Short and Grouper supporters such as Sir John Kerr (both of whom were Anglican) demonstrated great courage when they successfully wrested control of the Federated Iron Workers (FIA) away from the communists in 1951. These industrial successes were not only important because they were advances for democratic unionism but also because they possibly heralded a return to power of a regenerated ALP that was closer to its support base.

This potential for ALP renewal was reflected in the 1951 federal election results in which the party picked up House of Representatives seats (but lost control of the Senate). However, the ALP took a massive step backwards later that year when Herbert Vere Evatt succeeded to the party’s leadership following Chifley’s sudden death.

Evatt deserves to go down in history as the worst ALP leader. Up until his election as ALP federal leader, Evatt had however served Australia with distinction. As one of Australia’s top lawyers Evatt undoubtedly had a brilliant mind. Furthermore, Evatt had been a very successful External Affairs Minister (i.e. foreign minister) between 1941 and 1949. He fulfilled an important role in founding the United Nations (UN) and was immensely proud of the fact that he had served as president of the UN General Assembly. Ironically, in the light of subsequent events, Evatt as External Affairs Minister gained a reputation as a strong anti-communist.

Intellectually brilliant as he may have been, Evatt was unfortunately prone to paranoia. This was manifested in 1954 when he pre-emptively denounced the decision of the Menzies government’s decision to establish a Royal Commission into espionage in Australia which became known as the ‘Petrov Commission’. The Royal Commission was named after Vladimir Petrov, a Soviet embassy official and spy who defected to Australian authorities in April 1954.

Petrov revealed that there was a Soviet spy ring in Australia. His defection had dramatic public impact when two Soviet embassy officials were filmed forcing his wife, Evdokia, to board a plane departing from Sydney’s Mascot Airport. Crowds of Eastern European refugees dramatically attempted to intervene to save Mrs. Petrov. Thankfully the plane stopped over at Darwin Airport where Northern Territory police overpowered the two Soviet officials, thereby allowing Mrs. Petrov to defect.

The dramatic rescue of Mrs. Petrov was briefly the top international news story. The Petrov affair vividly brought the Cold War home to many Australians. Evatt’s action- in denouncing the Menzies government’s establishment of a Royal Commission into espionage as being politically-motivated consequently alienated much of the electorate.

The terms of reference of the Petrov Royal Commission were such that, for national security reasons, its findings could not be released for thirty years. The only way therefore for the ALP to be negatively implicated was for Evatt to have denounced the Royal Commission as politically motivated. This action resulted in the ALP losing the May 1954 federal election which it had been tipped to win.

If Evatt’s actions in the lead up to the May election were unwise, then his subsequent actions following the ALP’s defeat were catastrophic. The opposition leader scapegoated the ALP Industrial Groups for his loss. At the March 1955 ALP federal conference, a motion was passed proscribing (i.e. banning) the ALP Industrial Groups from their party! This heinous motion passed by a one vote margin due to the non-credentialing of the legitimate Victorian state branch delegation.

The events surrounding the illegitimate 1955 Hobart ALP federal conference are generally known as the ‘Split’. However, the 1955 ALP Split was not so much a ‘split’ as a purge. Evatt took the action of purging loyal anti-communist members and unionists (there were also party members who were not expelled but departed as a matter of principle). This political purge was also a split in that it divided families and communities across Australia.

The ‘rational’ dimension to Evatt’s actions was his belief that a purge of the ALP, similar to the 1916 Split, would arouse sectarian sentiments and that, for every Catholic vote that was lost, the ALP would be compensated by gaining two anti-Catholic votes. This warped scenario thankfully did not come to pass due to a diminution of sectarianism within Australian society. (This was probably the principal beneficial legacy of Joe Lyon’s Prime Ministership).

Evatt’s purge therefore threw the ALP into turmoil without any compensating political dividends. This was evidenced by Menzies calling an early 1955 federal election in which the coalition was returned in a landslide due to division of the Labor vote.

A mythology which arose as a result of the 1955 Evatt purge was that the ALP was consigned to a near generation of opposition until a messianic figure in the person of Edward (‘Gough’) Whitlam came along to redeem the situation. This perspective is incorrect. The federal ALP had recovered electability by 1961 when the party came within one seat of federal election victory. The sharp swing back to the ALP was due to a credit squeeze that year when the government slowed the rate of growth to avoid an inflationary spiral.

Arthur Calwell Almost to the Rescue, 1961 and 1963

The fact that the ALP had been able to harness discontent caused by the credit squeeze was due to the quantum leap that the party took by elevating Arthur Calwell to the leadership in 1960 in place of the discredited Evatt. The Evatt purge could have been irrevocably disastrous for the ALP had Calwell exercised the distinct option of leaving the party in support of the illegally prescribed ALP Industrial Groups. Instead, Calwell opted to stay on as deputy leader and reluctantly support Evatt for which he only earned the latter’s contemptuous ingratitude.

Calwell was then the ALP’s clearest and best link to the Curtin/Chifley era. There were positive legacies of the previous ALP federal government that came from Calwell’s tenure as Labour Minister. In this portfolio, Calwell had initiated and sponsored a massive post-war migration program in which immigration was opened up to non Anglo-Celtic Europeans. This development resulted in greater racial diversity in Australian society without which the long standing racist ‘White Australia’ policy, banning Asian migration, could not have been ended in 1967.

The migration program was partially undertaken to support another Calwell supported initiative, the massive Snowy Mountain Hydro-Electricity Scheme which was constructed in New South Wales in the 1950s. This public works scheme provided an important stimulus for economic growth and the resultant generation of electricity helped underpin a valuable domestic industrial base. As Labour Minister, Calwell had also taken an uncompromising line against communist industrial strike action in 1949 by sending in troops to work in the coal mines. Calwell demonstrated physical courage during the strike period by addressing meetings of workers in which he was heckled by communist agitators.

It was therefore sadly ironic that Calwell inherited an ALP from Evatt that then had a substantial and growing pro-communist component. The mass exodus of disenchanted party members following the Evatt purge facilitated the entry of pro and covert communists into the ALP. A discernable ‘left-wing’ also began to emerge within the ALP as a result of anti-Grouper elements in the union movement, who were often anti-Catholic, teaming up with communists in union elections to form ‘unity tickets’.

The shift which was occurring in the ALP during this time was reflected by a growing opposition within the party to one of its most important platforms, state aid for non-government schools. The non-ALP parties had traditionally opposed state aid for non-government schools as a sectarian carry-over from the 1916 Split. Menzies exploited the trouble that Calwell was having with regard to maintaining the ALP’s traditional state aid policy to appropriate this policy during the November 1963 federal election.

(Menzies went into the 1963 election with a one seat majority. This fact and the suddenness with which the Prime Minister sprung this policy shift enabled him to out manoeuvre anti-Catholic elements within the Liberal Party by adopting the state aid policy for non-government schools).

The Democratic Labor Party 1957 >>>>>>>>>>>

Menzies’ state aid announcement secured Catholic votes – which had been returning to a Calwell led ALP- back to the Democratic Labor Party (DLP). DLP preferences in turn secured the Liberal Party’s 1963 re-election. With the greatest respect to Sir Robert Menzies, it probably would have been better for Australia had he lost the 1963 federal election. This is because not only would Calwell have been an excellent Prime Minister but an ALP victory in 1963 would have averted the disaster of the ALP Whitlam government (1972 and 1975).

The greatest and most tragic mistake that Calwell made in his political career was his failure to reconcile with the DLP. This party had been formally founded in 1957 by supporters of the ALP Industrial Groups. Despite the polarizing effect that the Evatt purge had on Australian society, the DLP’s viability was problematic from the onset.

The DLP held together between 1962 and 1964 (when the party had no federal parliamentary representation) because its Victorian leader, Frank Mc Manus, worked full-time for the party and applied his considerable organisational skills to win election to the Senate in 1964. Menzies’ action of supporting aid for non-government schools helped revive the DLP vote throughout Australia. The parliamentary skill that Mc Manus and the other DLP senators (who had once been the crème de la crème of the ALP) enhanced the quality of the Senate as a house of review and, between 1970 and 1974, the DLP held the balance of power in the Senate.

The enduring political legacy of the DLP was that its Senate representation facilitated awareness of there being a ‘third force’ in Australian politics. This role is currently being fulfilled by the Australian Greens Party. The Greens are essentially a coalition between genuine environmentalists and extreme leftists who are utilizing the party as a vehicle.

The Greens now exercise a considerable influence in Australian politics despite not having the balance of power in the Senate. This is due to the strategic links that the Greens have with the Socialist Left (SL) faction of the ALP within the federal government.

Twenty percent of the Australian electorate do not vote for either of the two major parties. Yet the Greens have still not won the balance of power in the Senate due to the reticence that many Australian voters have in regard to them. There is still consequently room for and a need for another minor party to counteract the Greens and engage in the contest of constituting the third force in Australian politics.

The DLP has still had an impact on Australian politics since losing federal parliamentary representation in 1974. The major pro-communist influence within the Victorian branch of the ALP was the late John Halfpenny. Had Halfpenny won election to the Senate in 1987 from the third position on the ALP Senate ticket, he could have moved Australia considerably to the hard left due to his superlative political skills.

Halfpenny’s possible election was thwarted by the preferences of the DLP 1987 Victorian Senate candidate, John Mulholland. Mulholland has led the DLP since 1983 as secretary. His commitment to the DLP has helped sustain the party after its loss of parliamentary representation. This loss resulted in most of its members forgoing their DLP membership either by withdrawing from party politics altogether or moving into one of the two major parties. It is a pity that the ALP and the DLP did not re-unite in the 1960s. However, there is still a need for the DLP under John Mulholland to return to the federal parliamentary sphere to counter the Greens on the one hand and the far right of the Liberal Party on the other hand.

It was the great Victorian ALP Senator, Pat Kenneally, who attempted in 1965 to re-unite the two labor parties. The re-unification of these parties was partly thwarted due to Calwell’s opposition. This opposition was unfortunate but understandable on Calwell’s part. He and his wife Mary had been subjected to social ostracism for remaining within the ALP at the time of the Evatt purge. The Calwells were disgracefully forced out of their parish of St. Brendan’s (in the Melbourne suburb of Flemington) and essentially could only attend Catholic Mass at the city church of St. Francis.

It is a tremendous tragedy that Calwell, the man whose motion at the 1937 ALP Victorian Conference authorised the establishment of the ALP Industrial Groups, denied himself the opportunity of winning government by not reconciling with his former stalwart supporters. A reconciliation between Calwell and Mc Manus in 1965 could well have provided the basis for an outstanding future ALP federal government. The tragedy of the Evatt purge was that it divided from each other people who should have been allies.

Menzies’ Positive 1966 Bequest

By contrast Menzies bequeathed a united and vibrant Liberal Party when he voluntarily retired as prime minister in January 1966. Remarkably, for some-one who had been (and still is) Australia’s longest serving prime minister, Menzies retired to genteel poverty. The former Prime Minister’s local party branch had to organise a fund raising appeal to pay off his mortgage. (Parliamentary pensions were far smaller then that what they are now).

Menzies placed more store in social recognition than he did in money. Sir Robert and his wife Dame Pattie (nee Leckie) were proud of their titles and the imperial honours that they had received for their public service. The Menzies were similar to other politicians, public servants and community leaders of the era in that they gained their sense of self-actualization from the social recognition that they received from the monarchy.

Paul Keating, the future ALP prime minister (1991 to 1996), grossly insulted his predecessor (who died in May 1978) when he claimed that Menzies would, in a contemporary context, have supported Australia becoming a republic. This claim, while ridiculous, conveyed an implicit and invalid message that Australia’s system of constitutional monarchy was dated.

As sentimentally attached as Sir Robert was to the monarchy, he was also a rationalist who understood how important it was for Australia to have a Westminster system of government and a federal form of government. The Australian Constitution, in which the Crown is integral, was drawn up by and for Australians, has stood the test of time and provides a guarantee of safeguarding the people’s future liberty.

From a sentimental perspective, it was a source of pride to Sir Robert and Dame Pattie that they enjoyed Elizabeth II’s personal admiration. Appropriately, the royal anthem God Save The Queen was played at Dame Pattie’s funeral in January 1995. As a committed monarchist, Dame Pattie accordingly became the first Patroness of the Australian Monarchist League (AML) upon its foundation in 1993.

Under the leadership of its National Chairman, Philip Benwell, AML has steadfastly pursued the objectives of retaining Australia’s system of constitutional monarchy and of loyally supporting Her Majesty, Elizabeth II. AML is independent from political parties and/or party factions but the League is prepared to support any politician who is sincerely monarchist and committed to defending the integrity of the Australian Constitution and of Australian states.

That the Australian Constitution is now under threat and that the positive legacy of the Menzies era is under challenge can be traced to the election of Gough Whitlam as Prime Minister in December 1972. Whitlam succeeded Arthur Calwell (who always remained a monarchist, in contrast to Whitlam, who shifted to become a republican) as ALP leader in 1967. The new ALP leader seemingly assumed a Menzian mantle when he dismissed the pro-communist Victorian branch of the ALP in 1970. This in turn assisted in endowing enough of the Australian electorate with confidence to cross the Rubicon and return the ALP to federal office in late 1972.

‘Crash or Crash Through’: The Whitlam Diaster 1972–1975

For all the hype concerning the Whitlam government’s (1972 -1975) achievements, it was a failed government. Whitlam came across as a man of stature and authority due to his wit and eloquence. However, Whitlam ignominiously failed to rein in ministers such as Rex Connor and Jim Cairns. Consequently, inflation and unemployment soared due to excessive government spending. A wages explosion and sudden and deep tariff cuts also undermined Australia’s economic situation which was already challenged by the stagflation wrought by the 1973 OPEC oil price hikes.

The most reprehensible aspect of the Whitlam government was that it covertly attempted to subvert constitutional process in pursuit of its policy objectives. This was most apparent during the 1975 Khemlani affair when the government commissioned a Pakistani financier, Tirath Khemlani, to raise money (‘petro-dollars’) from Arab Gulf states to finance a takeover of mining resources from multi-national companies.

According to constitutional practice, the Governor General should have chaired the December 1974, Executive Council meeting which authorised the commissioning of Khemlani to raise the funds. The Governor-General, Sir John Kerr, was not invited to the December 1974 council meeting but was compelled to sign the authorisation the following day. This process was also questionable because the regular Treasury channels were not consulted.

Press revelations in 1975 concerning Khemlani’s activities and the government’s lack of transparency as to how it was trying to raise money outside regular channels provided the opposition with the grounds to defer supply (i.e. the funds to run the government). The Liberal led opposition moved in the Senate to defer supply to compel the government to call an early election. According to Westminster convention, a government must resign or call an early election when parliament denies it the necessary funds to govern. As opposition leader in 1970, Whitlam supported this convention with regard to governments either resigning or calling early an election when the Senate refuses supply bills.

The fortitude that the Liberal Party leader Malcolm Fraser showed with regard to deferring supply may have been derived from the influx of new members and donations to Liberal Party branches due to public dissatisfaction with the Whitlam government. Both Fraser and Whitlam seemed unyielding and the country faced financial crisis as the government was about to run out of money unless the Senate passed supply bills at the November 11th 1975 sitting.

The Man in the Middle: The Courage of Sir John Kerr 1975-1977

The Governor-General, Sir John Kerr, who had not instigated the dispute, found himself in an invidious position. Prior to the crucial November 11th Senate vote, the Prime Minister had a morning audience with the Governor-General. There was speculation that there were Liberal Party senators who were going to cross the floor and vote to pass the supply bills, but this was not the issue at stake during the audience. The Governor-General asked the Prime Minister (who had come to ask for an early Senate election) if he could guarantee supply and if it was his intention to govern without supply.

The admission by Whitlam that he could not guarantee supply and was prepared to govern without the necessary funds led the Governor-General to inform the Prime Minister that his commission was terminated. Sir John recounted in his memoirs that, had Whitlam asked him to re-consider his intended dismissal action (which had not taken effect because it was still a verbal communication), he would have done so but only on the basis that the Prime Minister committed then and there to hold an early general election.

Whitlam’s immediate reaction that he would seek the Queen’s intervention led the Governor-General to then display his signed papers thereby putting into affect his constitutional action. Following Whitlam’s departure from the room, Fraser (who had been waiting in another room) was then commissioned as caretaker Prime Minister. Fraser was appointed on the basis that he undertook to hold an early election and that he could guarantee supply.

The above stated conditions of appointment warrant being examined because they affirm the legitimacy of Sir John’s dismissal procedure. Whitlam would later claim that the Governor-General undermined the democratic process by refusing to re-appoint him Prime Minister when later that day the House of Representatives passed a vote of no-confidence in Fraser after the Senate had voted to pass the supply bills for the caretaker government. This criticism was invalid because the only prerogative that Fraser had as a caretaker Prime Minister was to advise a double dissolution election which he had committed to hold as a condition of his appointment.

Sir John’s intention was that the political impasse be resolved by having the Australian people decide in a general election. For all the hype that Whitlam generated in the ensuing election campaign, the coalition was elected to power in a landslide on December 13th 1975.

The second condition of Fraser’s caretaker appointment raises an interesting aspect of analysis. Fraser was not necessarily in a position to guarantee Senate supply because the ALP had the numbers to deny him this. The question arises as to why Whitlam did not inform his Senate colleagues of his dismissal which resulted in their unwittingly voting for supply bills for a Fraser government. Whitlam certainly did not hesitate to inform ALP House of Representative MPs of his dismissal once the supply bills were passed by the Senate so that they would pass a vote of no-confidence in Fraser.

Whitlam’s reticence in informing his Senate colleagues could well have reflected his relief that the dismissal had taken affect so that he could re-cast himself as a political martyr. By attacking Sir John’s character, Whitlam was able to obscure his political failures and solidify his base among his supporters. In the long term, Whitlam’s handling of the dismissal supported the maxim that the best hope for a failed politician is to create a myth.

It was in pursuit of the objective of recasting himself that Whitlam pursued a vitriolic vendetta against Sir John. The Governor-General did consider resignation following the December 1975 federal election but, with Fraser’s support, Sir John decided to stay on as Governor-General to affirm the legitimacy of the dismissal. Sir John resolved to undertake extensive public engagements so that, by the time Queen Elizabeth II visited Australia in 1977 for the twenty fifth anniversary celebrations of Her Majesty’s ascension, agitation against the dismissal would be substantially diminished.

Sir John’s objective was met and the 1977 royal tour to Australia was a great success. However, the personal price that the Governor-General paid was a high one as he and his wife, Lady Anne, (who insisted on accompanying her husband) were consistently subjected to taunts and threats of physical violence by demonstrators when they fulfilled their public duties.

Having established the legitimacy of the dismissal, Sir John announced in July 1977 that he would resign as Governor-General in December which he did the day before the December 1977 federal election. In this election, the federal coalition government was returned with its large majority intact. The ALP’s failure to make any headway resulted in Whitlam’s immediate resignation as opposition leader and his subsequent departure from parliament in early 1978.

Although Sir John was ostracised for doing his duty, he was personally fortified by a personal letter of support he received from Menzies in November 1975 and which he published in his memoirs with the permission of the former Prime Minister. The saddest aspect of the dismissal was that Sir John Kerr’s reputation was unfairly tarnished for resolving a political crisis which he had not instigated.

By contrast, Whitlam, who had put his own interests ahead of the nation’s with his ‘crash or crash through’ approach, successfully re-cast himself as a political legend who had fallen victim to entrenched reactionary forces which were threatened by his visionary reformist agenda.

A Failed Deakin: The Fraser Enigma, 1975–1983

The succeeding Fraser governments (1975 to 1983) were enigmatic. The principal achievement of this government was to restore a sense of coherence and stability in the wake of the chaos of the Whitlam government. The principal failure of the Fraser government was that it did not renew or develop the political tradition bequeathed by Alfred Deakin.

The Deakin tradition dating back to the early twentieth century was socially liberal to the point of radical. The Menzies government’s success in operating within this paradigm entrenched the perception that the Deakin legacy was conservative. Malcolm Fraser’s patrician background as a scion of a Western Districts family and member of the Melbourne Establishment bolstered the perception that the Deakin legacy to which Fraser subscribed was right-wing.

Fraser failed to formulate a political strategy which would have renewed Deakin’s legacy because he came across as something which he was not — a free market radical. Although this Prime Minister (an underlying Deakinite liberal) presented himself as a proponent of free trade, smaller government and an opponent of a centralized award system of industrial relations he took no substantial action to implement any neo-liberal reforms with regard to these policy objectives.

As a result, Fraser alienated would-be supporters such as the New South Wales federal MP Jim Carlton who expected free market economic reform. Additionally, Fraser’s espoused policies saw him squander the support of potential allies such as Australian Democrats leader Senator Don Chipp who was a vehement Fraser critic. (Fraser and Chipp were politically reconciled during the Howard era).

The one area in which Fraser was to invoke Deakinite principles in a contemporary context was immigration policy. The Fraser government generously granted refuge to migrants from communist Indo-China. This humanitarian approach was extended to all migrants. The clarity of his government’s anti-racist record gave Fraser the credibility during the Howard era to attack its retention of the policy of mandatory detention (which was introduced by the Keating ALP government in 1992) and distinguish his government from the later Howard government.

The Whitlam government’s policy of multi—culturalism, utilizing the diversity of the different backgrounds of migrants to promote community harmony, was consolidated under the Fraser government. In indigenous affairs, the Fraser government granted Aboriginal land rights in the Northern Territory. This government’s unqualified opposition to the Apartheid regime in South Africa won international respect and helped the nation (until the Howard era) discard the stigma that the ‘White Australia’ policy had inflicted on Australia’s international reputation.

The Reid Reincarnation: Fraser Mentors John Howard, 1977-1983

Fraser’s failure to bequeath a viable political tradition was compounded by a series of ultimately counter-productive ministerial appointments and power shifts which he made as Prime Minister. Fraser’s most glaring political mistake was his promotion of John Howard to Treasurer in 1977. Howard became the ideological successor to George Reid and, as such, would later relentlessly exploit Fraser’s failure to safeguard Deakin’s legacy.

A counter-productive aspect of the Fraser government was the Prime Minister’s orientation toward dismissing ministers for any hint of impropriety. Superficially, such an approach should be praised. However, the fine line between maintaining high standards of ministerial conduct and exercising tight political control over ministers became blurred during the Fraser government. This was evident when the Prime Minister forced the resignation of his Treasurer Sir Phillip Lynch in November 1977 due to an alleged conflict of interests in relation to his real estate dealings. (Sir Phillip was later cleared of any impropriety).

The Prime Minister’s action of undermining Sir Phillip set the scene for Howard’s ascent and the unravelling of the Deakin legacy. John Winston Howard was thirty-eight at the time of his appointment as Treasurer in November 1977.

The Prime Minister may have considered his protégé malleable due to his relative youth. As Treasurer (1977 to 1983), Howard never challenged the Prime Minister’s authority despite at times intense frustration on his part concerning economic policy direction. Howard probably mastered his frustration in the belief that the experience he gained as Treasurer would enable him to lead a post-Fraser Liberal Party in a new free market direction.

That Howard’s ascendancy did eventuate was due to the on-going rivalry between Fraser and Andrew Peacock. Peacock was considered to be the Liberal Party’s Crown Prince (‘the Colt from Kooyong’). He had been elected at the age of twenty-seven to succeed Menzies as the member for Kooyong and there was a widespread expectation that he would, one day, be Prime Minister or, at the very least, Liberal Party leader.

The Outmanoeuvred Peacock

Fraser outmanoeuvred Peacock to become Liberal leader in March 1975. In contrast to John Howard, Paul Keating and Peter Costello, who eventually chafed in the Treasury portfolio, Peacock usually enjoyed serving as Foreign Minister. The urbane Peacock made a very favourable impression on the international scene and world leaders whom he met often assumed that he would one day lead Australia.

Peacock was better placed than his future arch-rival Howard to position himself for the post-Fraser era because of the general policy ascendancy he had in his portfolio. This potential advantage was squandered by Peacock because the coterie that assembled around him as heir apparent apparent goaded him into challenging Fraser. Peacock foolishly had himself shifted to the portfolio of Industrial Relations Minister following the 1980 election, he resigned that position in 1981 and then unnecessarily challenged Fraser for the Prime Ministership in April 1982.

The ramifications of Peacock’s challenge were to be thoroughly counterproductive. Due to their dissatisfaction with Fraser free market proponents within the Liberal Party (‘dries’) at this point (1982) were the backbone of Peacock’s support base. The problem for Peacock, similar to Fraser, was that he was attempting to be something which he was not. Peacock at heart was not a dry but a pragmatist who was inclined to go with policies which worked in a practical context.

The upshot of the 1982 challenge was that it forced Fraser to support Howard’s election as deputy leader, in place of the still loyal Sir Phillip Lynch, to undercut dry support for Peacock. When Fraser was defeated in the March 1983 federal election, Howard therefore had a cohesive basis of dry support to hold onto the position of deputy leader after Peacock defeated him for the position of Liberal leader.

Another irony of Peacock’s 1983 succession to the Liberal Party leadership was that Fraser supported his one time leadership rival. This was despite the fact that Howard had remained loyal to Fraser until his Prime Ministership ended. (Fraser and Howard’s post -1983 enmity toward each other would obscure the fact that they had been pre-1983 collaborators).

The election of the Hawke ALP federal government in 1983 would amount to considerably more than a change of power from one party to another. In its first year in office, the Hawke government floated the Australian dollar, removed foreign exchange controls and allowed the entry of foreign banks. A program of micro-economic reform was commenced in 1987 and in, the following year, an industrial relations reform program was undertaken which led to a shift to an enterprise bargaining industrial relations framework.

The Australian union movement, through the ACTU, accepted, if not supported, the Hawke/Keating reform program through its adherence to the government’s wage and incomes policy which was known as the ‘Accord’. Under the Accord, the ACTU was granted a role in the formulation of social policy concessions, such as tax cuts, in return for union wage restraint. The provision of ‘social wage’ policies under the Hawke government, such as Medicare (which facilitated universal health care), helped ensure that the ALP federal government maintained its social democratic bearings.

Treasurer Paul Keating was an important driver of the Hawke government’s reforms. Until Keating’s first challenge for Prime Ministership in May 1991, Hawke and Keating seemed to co-operate productively. After a six month leadership struggle, Keating deposed Hawke as Prime Minister in December 1991 in a ballot among ALP federal MPs (Caucus). The succeeding Keating government (1991 to 1996) alienated the ALP’s traditional base because it failed to deliver the social policy dividends that the Hawke government had.

The effectiveness of the Hawke/Keating political partnership up until 1991 (although there had been earlier signs of dissatisfaction on Keating’s part) starkly contrasted with the seeming inability of Peacock and Howard to ever forge a successful political partnership. Due to his under-utilization of the coalition’s Employment and Industrial Relations Spokesman Ian Macphee, Peacock in his first period as Liberal leader (1983 to 1985) failed to match Howard’s seeming mastery of economic and industrial relations policies.

Ian Macphee: The Arthur Calwell of the 1980s.

Ian Macphee was the equivalent 1980s version of Arthur Calwell in that he was the opposition’s link to its most successful legacy in government. As the Fraser government’s Immigration Minister, Macphee had consolidated the policy of multi-culturalism, granted asylum to refugees and initiated the family re-union scheme.

The Hawke/Keating government’s economic liberalization policies precluded the coalition holding onto the Deakin legacy in an undiluted form. But Macphee probably had the capacity to formulate lateral policies to accommodate the need for reform without forsaking the underlying principle of equity associated with the Deakin legacy.

As the coalition’s Industrial Relations Spokesman, Macphee formulated an industrial relations reform policy which facilitated greater flexibility without abandoning an arbitral award safety net. Had Macphee been allocated a senior economic portfolio, Peacock may have had greater policy scope to counter Howard or at least engender greater policy diversity within the Liberal Party. Instead, Peacock opted to categorize himself as ‘damp’: dry in relation to economic/industrial policy and ‘wet’ (i.e. moderate) in relation to coalition social policy.

The Howard/Peacock Rivalry, 1985-1990

Frustration on Peacock’s part concerning Hawke’s high popularity probably led him to make an ill-considered personal attack on the Prime Minister on the eve of the commencement of the 1984 election campaign. (This election was called nearly eighteen months early). Negative re-action to this attack provided senior Liberals with a pretext to abandon Peacock during the six week election campaign. This was done out of fear that the then very popular Hawke would win a landslide. For many political commentators, the interesting aspect of the campaign was that it seemingly heralded the end of Peacock, the golden boy who had been touted as a successor to Menzies.

Peacock however waged a determined one man scare campaign in which he predicted the introduction of an assets tax and means testing of pensions. As shameless as his campaign was, it was all that a near abandoned Peacock could utilize. Nonetheless the Colt from Kooyong won grudging admiration from the public for his coolness under pressure so that he actually (and very unexpectedly) trimmed the ALP’s parliamentary majority.

The opposition leader’s tenacious fight back led to a general re-assessment that he had proved his leadership mettle to the extent that he would continue on as Liberal leader for the next parliamentary term and very possibly defeat Hawke at the next election. That this scenario did not come to pass was due to Peacock’s failure to assert his authority over Howard. The ALP ran a relentless psychological campaign in the new term that played up the latent tensions between Howard and Peacock.

A disconcerted Peacock was so unnerved by the ALP’s campaign that he demanded that Howard pledge that he would never challenge for the Liberal leadership during the parliamentary term. When Howard refused to give such a commitment, Peacock tried to have him removed as deputy leader at a Liberal Party parliamentary meeting in September 1985. The Liberal Party parliamentary room refused to remove Howard for fear of the policy vacuum that would ensue if he moved to the backbench. A stunned Peacock consequently resigned as leader and this paved the way for Howard’s election as the new party leader.

This extraordinary sequence of events further fuelled leadership instability within the federal parliamentary Liberal Party. Despite Howard’s mastery of policy detail, most Liberal MPs probably would have preferred Peacock as leader due to his smoothness. A refusal to recognize Howard’s legitimacy as leader was manifested by constant leaks by MPs of draft policies and confidential material to the press. This discord in turn buttressed a more credible ALP destabilization campaign which maintained that Howard was not sufficiently secure to prevent a probable Peacock return to the leadership.

The weakness of Howard’s leadership position provided the impetus for the Queensland Premier, Sir Johannes (‘Joh’) Bjelke-Petersen, to launch a bid for the Prime Ministership in February 1987. This bid was fanciful from the beginning. In Queensland, Sir Joh’s National Party (the former Country Party) was the dominant non-ALP party instead of the Liberal Party. There was no viable prospect of the National Party displacing the Liberal Party as the major opposition party let alone winning government at a federal level.

As inherently unviable as Sir Joh’s campaign was, it still wreaked havoc on the federal coalition. The Queensland Branch of the National Party’s withdrawal from the federal coalition precipitated the coalition’s collapse in late April 1987 to the chagrin of the Nationals’ tough, but hapless, federal leader, Ian Sinclair. The Joh push had exacerbated Howard/Peacock tensions. In March 1987, Peacock was sacked from the shadow cabinet after a mobile phone conversation between him and Victorian Liberal leader Jeff Kennett was picked up in which Howard was criticized in very colourful language.

There may have been a legitimate reason for Howard to sack Peacock but his dropping of Macphee from shadow cabinet in April 1987 was unprovoked. Macphee’s removal violated the Menzian injunction that an important role of Liberal leaders was to accommodate and utilize different ideological orientations within the Liberal Party.

The upshot of the turmoil on the non-ALP side of politics was that Howard essentially went into the July 1987 federal election without a viable prospect of winning. The improbability of Howard winning was confirmed when the release of his tax policy during the campaign, which promised substantial tax cuts, was found to have a major arithmetical error.

In an eerie replay of Peacock’s 1984 struggle, Howard similarly went into the 1987 campaign as an isolated figure because senior Liberals abandoned him. Howard’s wife and steely confidante, Janette assumed the most prominent public profile that she ever would in her husband’s political career by visibly supporting him during the 1987 campaign.

Incredibly, Howard’s election campaign did have its successes. His campaign launch upstaged the ALP’s glitzy campaign launch at the Sydney Opera House. The embattled Howard also made a strong personal connection with Liberal Party members across Australia. This would later hold Howard in good stead and explain his subsequent political durability despite a failure to strike a wider rapport with the Australian public.

The ALP was returned to power in 1987 but with a swing in the popular vote to the Liberals. Due to poor Liberal Party targeting, the popular vote swing did not translate into the necessary pick up of seats to win office. In a continuing theme of missed potential, Howard’s concession speech on election night was actually the best of his campaign.

The dividend for Howard for waging such a dogged campaign, (similar to Peacock in 1984) was that he secured his re-election as leader by the Liberal Party parliamentary room. Peacock still had a solid base and, after unsuccessfully contesting the leadership against Howard, he was elected to the fall back position of deputy leader.

Forgetting Nothing, Learning Nothing: The Howard/Peacock Rivalry Persists

The new Howard/Peacock leadership team offered the coalition (the Nationals returned to coalition after the 1987 election) with the best hope of winning government if the Liberal Party’s two principal leaders worked co-operatively. The events which subsequently transpired demonstrated that such co-operation would be an impossibility. Furthermore, both Howard and Peacock failed to harness the opportunity which opposition affords for positive re-invention.

In his capacity as Shadow Treasurer and Liberal deputy leader, Peacock sold himself short by not developing alternative economic policies which went beyond dry economic rationalist policy prescriptions. This would later be a fatal shortcoming because it would not only deny Australia the opportunity for alternative economic policies but allow Howard to maintain his unchallenged ideological ascendancy within the Liberal Party.

By way of contrast, Howard did seek to reinvent himself as a strong leader by challenging the previous bi-partisan approach to immigration. In 1988, the opposition leader stated that the level of Asian immigration should be taken into account in relation to its potential impact on racial cohesion. If the intended impact of the policy shift was to promote social harmony, then it proved to be counterproductive. Many Asian Australians (including Vietnamese migrants, who had been staunch Liberal Party supporters), became concerned that race could become a determinant of immigration policy.

The socially divisive ramifications of Howard’s immigration policy cost him dearly in the short to medium term. They would be a factor in his deposition as Liberal leader in May 1989 and an impedient to his future return to the Liberal leadership, which he eventually achieved in January 1995. Howard later gave vigorous re-assurances that race would never again be used as a political factor by emphasising that he would govern for all Australians. Nevertheless, as Prime Minister, Howard used race related issues to harness crucial electoral support. The most notorious instance of Howard doing this would be his refusal to allow imperilled refugees to even temporarily land in Australia.

The political ructions caused by Howard’s immigration policy shift enabled the then Liberal Party Federal President John Elliot to undermine Howard politically. As the Chairman of Elders IXL Elliot was then one of Australia’s leading businessmen. It was widely believed in 1988 that Elliot was attempting to dislodge Howard so that he (Elliot) could become Liberal parliamentary leader. However, Elliot’s destabilization campaign was probably intended to, and ultimately did, have the effect, of winning over dry support from Howard to enable Peacock to return to the Liberal leadership in May 1989.

Ironically, as disdained as Howard was in the 1980s by the public, he was personally very popular with Liberal Party members. This popularity was manifested in May 1989 when Howard – admiring Liberal Party branch members in the Melbourne seat of Goldstein deposed Ian Macphee as the Liberal candidate for the next election. Negative media re-action to Macphee’s deposition helped provide Peacock with the momentum to successfully challenge Howard for the Liberal leadership in the same month.

Figures associated with the Liberal Party’s Melbourne Establishment, such as Peacock, Elliot and Fraser, were alarmed by Macphee’s pre-selection loss. With the benefit of hindsight, Macphee’s political demise can be seen to have heralded more than an end of the political career of a senior Liberal. Macphee had the intellectual and technical skill to have broadened the policy direction of a future Liberal government beyond an economic rationalist paradigm.

There was to be no future Peacock government and such a government may not have been a success. Much was made of the fact that economics was not Peacock’s forte but it had not been Menzies’s strong suit either. However, Menzies was able to maintain his policy ascendancy by drawing on a diversity of opinion within his government.

Peacock, by contrast, probably lacked a sufficiently wide base so that he possibly would have been beholden to economic rationalists from Sydney such as Jim Carlton and Dr. John Hewson. Paradoxically, John Elliot might have been a counter-weight to the economic rationalists in a hypothetical Peacock government. Elliot, in colourful language, had warned against reckless tariff cuts and he had a broad network of contacts which could have served as a conduit to community concerns. The failure of Peacock to win the March 1990 federal election would later cost Elliot dearly and it was only due to Elliot’s tremendous personal courage that he has since survived.

The coalition’s defeat in the March 1990 federal election was primarily due to the public’s scepticism that Peacock had the necessary depth to successfully lead Australia. This election defeat seems to have heralded the end of the pre-eminent influence of the Melbourne Establishment that it had enjoyed within the Liberal Party since Menzies won office in 1949. The capacity of this establishment to survive by re-adapting may have been irrevocably thwarted by Peter Costello’s recently announced retirement. In this context Costello may very well have left his mark on Australian history and a biographical overview of his political life is warranted.

Peter Costello: The Student Politician

Peter Costello first made his political mark in university student politics. His time in university student politics, in contrast to that of Menzies, was turbulent. Costello commenced study for a law/arts degree at Melbourne’s Monash University in 1975. At this time, Monash University student politics was dominated by an extreme Maoist left and is now (2009) controlled by a comparatively more moderate left at the university’s Clayton campus. (The Monash University Democratic Labor Party Club was at the forefront of organising a Student General Meeting, SGM, in 1970 which broke the power of the university’s Maoist student leader, Albert Langer).

The newly enrolled student joined Monash University’s Evangelical Union whose support he utilized to win election in 1975 to the Public Affairs Committee (PAC) of the Monash Association of Students (MAS). At this early stage, Costello probably commenced his alliance with another law student and a Liberal Party supporter, Michael Kroger. With Kroger’s support, a series of front, or ‘feeder’ election tickets, were run for PAC. These tickets cross preferenced each other and enough moderate student representatives won to secure Costello’s election as PAC Chairperson.

Utilizing the position of PAC Chairman, Costello successfully ran for the position of the Chair of Administrative and Executive Committee (AE) of the Monash Association of Students (MAS) in 1976. To be elected as a moderate, and to hold office as the chair of the main student organisation of Australia’s most notoriously left wing university campus for two years (1976 to 1978), was a remarkable feat.

As AE Chair, Costello successfully turned the tables on the far left by outmanoeuvring their attempts to sack him as AE Chair at SGMs and by actually substantially exercising the power of the office to which he had been elected. Surviving and prevailing as a moderate student leader in the hot house environment of Monash student politics was no mean feat. Indeed, Costello was even physically beaten up by a member of the far left and subsequently hospitalized, an event which was reported in Melbourne newspapers.

The Monash student leader came to the forefront in national student politics through his leadership involvement in a nationwide campaign called, ‘The Coalition to Reform AUS’. The Australian Union of Students (AUS) was then an association of Australia’s predominately far left controlled campuses. Due to student compulsory membership fees, AUS had a massive campaign budget. AUS funds were used to fund far left anti-American social movement groups, some of which were virulently anti-Israel.

Politically active moderate students across Australia utilized ‘The Coalition to Reform AUS’ as an umbrella group to initiate and co-ordinate dis-affiliation campaigns of university campuses from AUS. These campaigns were ultimately successful and AUS was wound up in 1984. Controversy would later emerge as to what extent Costello could claim credit for helping bring AUS down. However, Costello’s position as Monash AE Chair gave him a prominence which was very valuable in fatally undermining AUS.

(A successor to AUS, the National Union of Students, NUS, was founded in 1987. NUS is far more representative of student concerns than AUS. This is due to the relatively strong position of the moderate ALP student faction, Student Unity and the National Liaison Committee which represents international students and secures services for them).

Social Democracy or Neo-Liberalism, Mr. Costello?

The networking opportunities which arose for Costello as a student politician led him to become involved with the ALP Right through his friendship with Michael Danby (who is now the ALP federal member for Melbourne Ports). Danby was then a Melbourne University student. He was (and is) an ardent admirer of Australia’s greatest social democrat philosopher, the late Dr. Frank Knopfelmacher.

Through Knopfelmacher’s mentoring role to the moderate Melbourne University ALP Club, (whose arch rival was the SL aligned Melbourne University Labor Club), a generation of activists in the 1960s and 1970s received invaluable political training and formation. Unfortunately, many of these students, such as Ray Evans, later utilized their skills to become involved in the New Right. Danby and Costello by contrast adhered to Dr. Knopfelmacher’s social democratic principles when they helped organise organise university campus and Young Labor clubs called the Social Democratic Students (SDS). (Costello himself later moved over to the New Right).

The SDS was potentially a wonderful opportunity which could have streamed a generation of social democrat activists from student politics and the ALP’s youth wing into the mainstream of Australian politics. The SDS did not sustain itself in the long term because of the previous failure of SDS activists in Young ALP branches and SDS university clubs to win control of the Shop Distributive and Allied Employees Association (SDA). The SDS campaign was waged between 1976 and 1977 under the slogan “The Team for a Better Union”.

There was nothing notionally wrong with the SDS, which was supported by the New South Wales ALP Right, wanting to gain control of a major Australian union and, in doing so, promote social democracy. The fundamental problem with the 1976/1977 campaign was that it was morally wrong and counterproductive to have undertaken a campaign in the first place against a union which was, and still is, the bulwark of moderate Australian unionism.

The SDA was one of the two major Grouper unions, the other being the Federated Clerks Union (FCU), which underpinned moderate trade unionism in Australia in the 1970s and 1980s. At the time of the Evatt purge in 1955 these two unions had disaffiliated from the ALP due to their principled support for the Industrial Groups.

During the 1970s, the FCU/SDA assisted the DLP University Clubs (some of which also went by the name of Democratic Clubs) wholeheartedly support moderate students in opposing AUS. DLP/Democratic Club students were at the forefront of defending the SDA in 1976/1977 from an ALP Right takeover. The tragedy of their successful defence was that it had to be directed against a group in which there could have been co-operation and some of whose members the SDA has since staunchly supported. The abortive campaign to take over the SDA was hopefully the last manifestation of the tragedy of the Evatt purge, conflict between inherently natural allies, the ALP Right and Groupers.

The attempted takeover of the SDA fortunately failed. The counterproductive nature of the campaign was borne out when the SDA re-affiliated to the ALP in 1984. Since returning to the ALP, the SDA has fulfilled a conspicuous and invaluable role in supporting the sensible and moderate elements within the party. (The SDA supported Social Action, when it was first founded in 1982).

This union has successfully utilized the institutional supports of the Australian industrial relations system to effectively represent and service its members. The SDA, which predominately represents retail workers, has the largest number of female members of any organisation in Australia and has fulfilled a very important role in formulating the ALP’s family and women’s policies. Social democracy in Australian politics and public policy cannot be effectively sustained without the support of the SDA.

Had the ALP Right’s attempt to take over the SDA in the 1970s succeeded, Peter Costello probably would have assumed a position within this union and pursued a political career with the ALP. It may seem strange that one of the Liberal Party’s most important post-Menzies figures would have been associated with the youth wing of the ALP. However, it should not be forgotten that student politics in the 1970s was virulently left-wing. As such, the ALP Right was an integral component (and still is) of the spectrum which encompasses politically moderate university students.

The negative consequence of Costello’s student political career is that he has since sought to downplay his previous association with the ALP Right. The Australian Liberal Students Federation (ALSF), which is the de facto student wing of the Liberal Party, has generally been hostile to supporting moderates in student politics. (An honourable exception has been the Melbourne University Liberal Club. The ALSF Queensland branch is also moving toward adopting a more positive approach).

ALSF served Costello as a de facto youth wing for the personal faction which he later formed within the Liberal Party. ALSF affiliates have either abstained from student elections or preferenced left wing tickets. This strategy has been pursued by ALSF affiliates in the mistaken belief that student unionism should and will be fatally undermined by bolstering the extreme left.

The negative approach of ALSF to student politics has meant that their mentor, Peter Costello, was deprived of the potential talent which Menzies had harnessed through the YNO. Due to the beneficial legacy of the YNO, Menzies was insistent that the new Liberal Party have a youth wing. For all the problems that the post-Menzies Liberal Party have endured, it has always had a viable youth wing, the Young Liberals.

A contemporary feature of the Liberal Party is the rivalry between the Young Liberals and the ALSF. The latter organisation (ALSF) might find it more beneficial to let go of its hostility to the Young Liberals and expand its capacity for social action by constructively engaging in student politics.

The failure of the ALP Right to win control of the SDA was probably a major blow to Costello but he had a Liberal Party fall back through his continuing connection with Michael Kroger. In June 1980, to the astonishment of Peter Costello watchers, the university graduate surfaced as a Young Liberal!

Utilizing his knowledge of labor law, Costello, as previously mentioned, undertook a series of high profile anti-union cases in the 1980s. His success helped spur the formation of the ‘New Right’ which acted as a catalyst toward moving the Liberal Party to an anti-arbitral approach to industrial relations. There holding this perspective would ultimately refuse to recognise the legitimacy of unions to represent their members or for employees to access basic entitlements.

Wither on the Branch? The Decline of Liberal Party Democracy

The strong anti-union stance that Costello adopted as a successful barrister probably helped endear him to Liberal Party branch members in the 1980s whose support he and Kroger cultivated. Their success in working the branches by travelling round Victoria and meeting with office-holders and key members culminated in the then thirty year old Kroger being elected as Victorian Liberal state president in 1987.

Kroger’s election to the presidency of the Victorian branch of the Liberal Party was an ominous development for party democracy and would lay the foundation for structural changes which would later rebound on Costello. Following the Liberal Party’s third consecutive defeat in the 1988 state election, the Victorian branch voted at its annual conference to allow party head quarters to have a role in pre-selecting candidates.

The precedent which Kroger established in Victoria set a pattern which was duplicated in all the other state branches. By allowing party bigwigs to interfere in, and eventually substantially determine, pre-selections, the Liberal Party’s rank and file squandered their power. A Victorian precedent was set and by the 1990s, each state division of the Liberal Party was riven by two opposing factions as pre-existing personal networks morphed into regimented factions which were still more personal than ideological. This would in turn facilitate a practice in which an opposing faction would so effectively sabotage the dominant faction so that it would lose the state election to the ALP.

The Liberal Party’s subsequent decline has been a result of the erosion of rank and file democracy within the party’s organisational wing. This is somewhat of a paradox. Theory concerning union effectiveness and social mobilization is often, and understandably, left-wing and focused on the need for rank and file support. Paradoxically Australian political history has often indicated that non-Labor parties are more likely to be successful if they harness rank and file support.

The Bjelke-Petersen governments in Queensland (1968 to 1987) were, to say the least, controversial. This government’s longevity and Joh’s dominance of it was, partially, but very importantly, derived from his utilization of a strong National Party branch structure. The support of a rank and file dominated party enabled the Queensland Premier to harness strong support for him and counter the intense opposition to him that existed within the then politically polarized state.

Another polarizing figure in Australian history was the Victorian Premier, Jeff Kennett. His state governments (1992 to 1999) were similarly controversial. However, on coming to office, Kennett singularly refused to return power to the Liberal Party branches. As a result, Kennett was not only disconnected from community sentiment but incapable of effectively harnessing existing support for his government against deep seated opposition.

The Kennett government’s fall in 1999 came as a stunning, but generally unlamented, surprise to most Victorians. Kennett’s refusal to return power to his party’s branches not only helped facilitate his government’s fall but underpinned the fatal factionalization of the Victorian branch of the Liberal Party.

The onset of Liberal Party factionalization was still to take effect when Costello harnessed support amongst party members to win pre-selection in 1989 for the safe Liberal Party seat of Higgins in Melbourne. His pre-selection victory was noteworthy because Costello was then a Howard supporter and his victory was then a rebuke to Peacock who was at that time ascendant in Victoria.

(The seat of Higgins had been held by former Liberal Party Prime Ministers Harold Holt (1966 to 1967) and Sir John Gorton (1968 to 1971). Holt, Menzies anointed successor, disappeared while swimming at the beach. Sir John Gorton, who moved from the Senate to the House of Representatives, was a much under-rated Prime Minister. He was also the only former Australian Prime Minister who publicly advocated a ‘No’ vote in the fortunately unsuccessful November 1999 referendum to make Australia a republic).

The ‘Young Turk’: Costello Finds his Feet. 1990-1994

Costello entered federal parliament following the Liberal Party’s fourth consecutive defeat in March 1990. The parliamentary party attributed these election defeats to the Peacock/Howard rivalry. Determined to put this rivalry behind it, the Liberal parliamentary party room elected a Sydney economics professor, Dr. John Hewson, as the new leader.

Hewson, who had previously been one of Howard’s principal advisors when he was Treasurer, had only been elected to parliament in 1987. But the Liberal Party was so desperate for unity and authoritive leadership (similar to what Menzies and Fraser had previously provided) that it gave carte blanche to Hewson in relation to policy formulation. The new leader and his deputy Peter Reith set the Liberal Party on such an extreme free market course that they frightened the electorate into returning the ALP to its fifth consecutive federal election victory in March 1993.

Much was made of the fact that the unpopular Paul Keating was able to win the 1993 election for the ALP due to the anti-GST scare campaign he waged. The GST policy was an important part of the polices that were contained in Hewson’s election manifesto Fightback. However, the range of policies contained in Fightback such as the elimination of a minimum wage and deep social security cuts were so extreme that they, in conjunction with the GST, frightened too many Australians.

An elated Keating heralded the ALP’s 1993 election victory as one for the ‘true believers’. This slogan may have been hype but there was (and still is) a section of the electorate which determines who wins Australian elections, the lower middle class. The ‘true believers’ tend to be socially conservative and expectant of state support to help them get by financially. In this context, and with the benefit of hindsight, Hewson always stood a good chance to lose the 1993 federal election.

As honest as Hewson was, he was too much of an ideologue and a government led by him would have been dangerously polarizing. The Liberal Party’s 1993 election defeat was a warning of the dangers inherent to a democracy when a major party becomes too narrow in its focus.

That Costello’s relationship with Hewson was originally tense and remained such was ironic. In the light of subsequent events, it was also ironic that Costello on entering parliament unsuccessfully tried to persuade Howard to challenge Hewson for the leadership. The Costello/ Hewson enmity was strange because they both essentially shared the same ideological outlook concerning economics and industrial relations. Nonetheless, due to Costello’s very impressive parliamentary debating skills, Hewson was obliged to appoint him to the position of shadow Attorney General in 1992.

Following the Liberal Party’s devastating 1993 election defeat, Howard and Costello formed a leadership ticket which unsuccessfully challenged Hewson. That Costello would unsuccessfully run for deputy in a ticket supporting Howard for leader would be amazing in the wake of their future spectacular fallout. Hewson was initially able to hold on as leader because of the residual strength of Andrew Peacock’s base.

In the period between Hewson’s re-election as leader and his deposition in May 1994, the inability of the Liberal Party to find a suitable replacement led to a focus on New South Wales Senator Bronwyn Bishop as an alternative leader. (Bishop had won widespread popularity when she publicly sparred with the taxation commissioner at Senate estimates hearings).

The intense focus on Senator Bishop as an alternative leader to Hewson between 1993 and 1994 was reflective of Hewson’s non-viability as leader, of the Liberals seeming inability to come up with a credible leader and of the public’s hope there would be viable opposition to the unpopular Keating. Another Liberal Party federal election defeat following the 1993 debacle would have seriously imperilled this party’s continued viability. The grave state of affairs that the Liberal Party was in between 1993 and 1994 was evident by the steep decline in corporate donations.

The Howard/Peacock division (which had supposedly ended upon Hewson’s election as Liberal leader in 1990) was glaringly apparent when Peacock supported Hewson to prevent Howard’s return to the leadership in the 1993 federal parliamentary leadership ballot. This state of affairs was untenable for the Liberal Party and it was Costello who, in May 1994, moved decisively into the fray to end the impasse. At Costello’s instigation, Alexander Downer was drafted to run against Hewson.

Downer was then forty two and a scion of a prominent family of the Adelaide Establishment. Due to the traditional links between the Adelaide and Melbourne establishments, (the viability of both cities, in contrast to Sydney, is substantially reliant upon their serving as capitals of viable states) Downer at this point was the only federal politician with whom Malcolm Fraser still had any influence. It was therefore with the support of Fraser and Peacock that Downer stood against Hewson for the leadership.

The idea that Downer stand for the leadership was Costello’s and it was he who persuaded Howard to forgo his leadership ambitions to support the South Australian. The degree of support that Downer actually had turned out to be relatively small but was still sufficient when combined with Howard’s support base (to which Costello then belonged) to depose Hewson in May 1994.

The ‘Dream Team’: Downer and Costello, 1994

Peacock supported the Downer/Costello ticket, the ‘dream team’, in which Costello was elected deputy and became the shadow Treasurer. This shift in support by Peacock was possibly reflective of his intention to support Costello as a future leader against Howard. Costello, at this point, was in essence, still a Howard supporter. The narrowness of Downer’s victory over Hewson rebounded badly on Peacock because it indicated that he had not carried his base. When Downer’s leadership began unravelling, Peacock took the opportunity to announce his retirement from parliament in September 1994.

Downer’s elevation as opposition leader in May 1994 was initially very popular due to the public’s desire for a credible alternative to the overbearing Keating. But Downer’s honeymoon was to be one of the shortest in Australian political history. Due to a series of stupid gaffes, including a tasteless joke, Downer’s viability as an alternative Prime Minister accordingly sank. Peacock’s announced departure cleared the way for Howard’s return to the Liberal leadership.

Having essentially facilitated Downer’s rise as Liberal leader, it was Costello who helped persuade his friend to depart and the Liberal Party’s leadership to accept Howard’s return as leader in January 1995. By steadfastly refusing to accept the leadership, Costello left his party with little choice but to accept Howard’s return. (Downer was compensated with the shadow Foreign Affairs portfolio and was subsequently Australia’s longest serving Foreign Minister, 1996 to 2007).

The Howard/Costello team signified that, nearly ten years after Howard’s first seemingly freakish rise to the Liberal leadership, unity and coherence had returned to the Liberal Party. In this respect, Costello had not only made a very important contribution to the Liberal Party’s continued survival but also strengthened its prospects of returning to office.

Costello’s motivations were probably not entirely selfless because he did not forgo his eventual leadership ambitions. In December 1994, a stalwart of the Adelaide Establishment, Ian Mc Lachlan, allegedly brokered a verbal agreement between Costello and Howard in which the latter agreed to step down as Prime Minister in the second term of a future coalition government.

The recycled opposition leader, Howard, did not have a honeymoon because he was then too discredited a political leader. But at this time (1995 to 1996) discontent with Keating’s Prime Ministership was so high that Howard only had to provide a coherent alternative to Keating to win office. Howard, with invaluable support from Costello, provided a feasible alternative to Keating such that the coalition won a landslide federal election victory in March 1996.

For All of Us? : The Howard Governments, 1996-2007

The coalition’s return to power was also assisted by a slick campaign which ran under the slogan ‘For all of Us’. The implicit message was that Howard would not replay race as a power dynamic in seeking to hold onto power. The campaign slogan was also specifically directed at Keating’s ‘true believers’ who were alienated by the ALP leader’s perceived elitism. The 1996 federal Liberal campaign successfully turned Keating’s ‘true believers’ into ‘Howard’s battlers’. This campaign ploy was highly successful but, in a later ironic turn of events, Howard would use race as a dynamic to hold onto the support of Australia’s lower middle class.

The Howard government struggled in its first two terms (from 1996 to 1998 and from 1998 to 2001) because the Prime Minister often came across as weak and duplicitous. In its first term the federal government was often mired in scandal due to too frequent violations of a ministerial code of conduct. The two senior ministers who provided a sense of coherent direction were Reith as Workplace and Employment Relations Minister and Costello as Treasurer.

Reith may have provided a sense of direction for the new government but it was an entirely negative one. Reith, as previously mentioned, introduced the Workplace Relations Act 1996. This legislation (which the Australian Democrats in the Senate helped to moderate) introduced individual employment contracts, called Australian Workplace Agreements, and attempted to undermine the capacity of awards to protect employee rights.

The Workplace and Employment Minister demonstrated his extremism by engineering a dispute with the Maritime Union of Australia (MUA) in 1998. The MUA is a union with Communist Party of Australia (CPA) connections. Reith engineered a dispute with the MUA by providing covert training in the Gulf state of Dubai (which belongs to the Arab Emirates) to non union employees and intended to ensure that they took the place of unionised labour on the wharves.

Reith wanted to use the MUA dispute as a launching pad to fatally compromise employee entitlement rights of Australian employees by setting the precedent of destroying the entitlement of MUA members (which at this time were considered by the public to be exorbitant). The broader Reith agenda did not eventuate because the two parties to the dispute, the MUA and the Patricks Corporation, pulled back to negotiate an Enterprise Bargaining Agreement. Nevertheless, the television footage of conflict tension between the police and picketers as well as private security guards on the wharves was unsettling to the general public.

Howard’s political relationship with Reith was a matter of concern. At the very least, the Prime Minister had failed to rein Reith in or he actually (and more probably) shared Reith’s extremist ideological agenda. Revelations in 2000 concerning excessive expenses on his ministerial phone card contributed to Reith retiring at the 2001 election. The aggressive role that Reith fulfilled in the Howard government was an indication of how destructively polarizing a Hewson government may have been as Reith had served as Hewson’s deputy.

Costello was the other major policy driver in the Howard government’s first term. In contrast to Reith, Costello as Treasurer fulfilled a positive role by laying the foundation to eventually eliminate the public debt he inherited and return the budget to surplus. The ALP had had impressive economic achievements with regard to opening up the Australian economy. However, the ALP had bequeathed too high a level of public foreign debt and budget deficit to the new coalition government in 1996.

Australia has nearly always been a debtor nation but debt has been often been from the private sector and serviceable. The most positive accomplishments of the Howard/Costello era were the virtual elimination of public foreign debt and the accumulation of a massive budget surplus. These positive achievements provided the scope for the Rudd ALP federal government’s stimulus package in the wake of the 2008 Global Financial Crisis.

Costello’s focus on improving Australia’s financial position was apparent from his first days as Treasurer and he remained consistently focused on this objective until the demise of the eleven year long Howard government. Whatever valid criticisms can be made against Costello during his time in the Howard government, his accomplishments with regard to strengthening Australia’s fiscal position can not be legitimately denied.

The precarious position of Howard’s first term government was apparent when the Prime Minister announced that, if his government was re-elected, it would introduce a Goods and Service Tax (GST). The Prime Minister could have been commended for his honesty in flagging a GST had it not been for the fact that he had gone into the 1996 campaign with a solemn and unequivocal promise that he would never introduce this tax. When accused of breaking his word, Howard would become famous, or infamous, for his distinction between ‘core’ and ‘non-core’ promises. (He asserted that his promise not to introduce a GST fell into the latter category).

The Perils of Pauline, 1996-1998

In his first term the Prime Minister also projected an image of weakness for his failure to repudiate the racist comments of the Queensland federal MP for Oxley, Pauline Hanson. As events were to unfold, this was a shrewd though unethical gambit on Howard’s part.

Hanson had been the endorsed Liberal candidate for the safe ALP seat of Oxley in the Queensland city of Ipswich in the 1996 election. She had been quoted in Brisbane’s Courier Mail newspaper for attacking Aboriginal ‘welfare’. Keen to maintain the coalition’s 1996 campaign message of social inclusiveness, the Liberal Party promptly dis- endorsed Hanson as its candidate for Oxley. The re-action against Hanson’s dis-endorsement in Ipswich was such as to enable her to win the seat in a stunning electoral upset.

Hanson, on unexpectantly winning Oxley, unsuccessfully tried to join the National Party. Inside the tent of a mainstream party, Hanson might have sunk into relative obscurity. Requiring back up and support as an independent MP, Hanson turned to support from the West Australian MP Graeme Campbell. He was the former ALP Member for Kalgoorlie, who had been re-elected as an independent in the 1996 election on an anti-immigration platform. It was thought that, if there was to be a parliamentarian who would be the central figure for far-right political movement, it would be Campbell.

The fact that Hanson would upstage Campbell was due to the saturation publicity that her September 1996 Maiden Speech received in the media. The speech was wooden to the point of incoherent but its brazenly racist assumptions were still clearly apparent. The momentum that Hanson received for her speech was such that she had the impetus to found a viable political party in April 1997 called ‘One Nation’. (This party reached the zenith of its power when it won 11 seats in the June 1998 Queensland state election).

A political consequence of One Nation’s foundation was that it spawned a strong left-wing social movement of protest groups primarily composed of young people and university students. Demonstrations were organised against Hansonism across Australia. In denouncing Hanson’s anti-immigration stance, these demonstrators drew attention to the fact that Australia had a system of mandatory detention for asylum seekers in which they were held for long periods and in some cases, (too many in fact) for an indeterminate period of time.

An important fact that was overlooked was that mandatory detention had been introduced under the Keating government by the Minister for Immigration Gerry Hand (who came from the SL faction of the ALP) in 1992. This policy shift went by relatively unnoticed until Hanson emerged as a prominent political figure.

Mandatory detention in effect undermined the generous open door immigration policy of the Fraser government. No-one argued that refugees fleeing by boat to Australia should be granted immediate asylum (and this had never occurred anyway). However, it was a reprehensible policy to in effect incarcerate people, including children, in detention centres (some of which were in the outback) for indefinite periods.

Howard was subjected to sustained attack for his maintenance of mandatory detention and for his refusal to offer an apology to Aborigines who had been forcibly taken from their parents as children and placed in orphanages or European foster homes. This barbaric policy was ended in the 1960s. In the 1980s, relatively obscure and under-resourced Aboriginal organisations such as Link Up, attempted to re-unite children (who were now adults) with their parents or surviving relatives.

During the Howard era, those Aboriginal children became known as the ‘stolen generation’. Intense pressure was placed on Howard by a burgeoning left-wing protest movement and the media to offer an apology to the ‘stolen generation’ and to end mandatory detention of refugees. The Prime Minister’s refusal at the time cast him as a weak leader. Future events, however, would reap very positive political dividends for Howard. His refusal to repudiate Hansonism would enable him to win future elections against adverse odds by thwarting the return of lower middle class votes to the ALP.

Costello did not actively oppose Howard’s immigration and indigenous policies but he still managed to convey his unease by announcing that he would place the One Nation Party his last preference on his ‘how to vote’ card for his seat in the 1998 federal election. The Queensland division of the Liberal Party’s refusal to follow the ALP’s example of putting One Nation last on its ‘how to vote’ cards in the June 1998 state election cost the Liberals dearly. In the Queensland capital of Brisbane, once stalwart bloc votes (including Asian votes) went over en masse from the Liberal Party to deliver an unexpected election victory to the ALP.

The only prominent Liberal to unequivocally call on his party to preference One Nation last, to issue an apology to the ‘stolen generation’ and to end mandatory detention was Malcolm Fraser. At the time, Fraser’s opposition was derided as jealousy on his part toward his previous protégé, Howard. This may or may not have been Fraser’s motivation but it could not be denied that the former Prime Minister was standing up for a Liberal Party policy which had once stolen a march on the ALP.

The ‘Howard Battlers’ and the Balance of Power

Despite the coalition’s massive parliamentary majority, it almost lost the October 1998 federal election. Indeed, the ALP won a majority of the popular vote. The massive swing to the ALP reflected a return of ‘Howard battlers’ to the fold of being ALP ‘true believers’. The coalition was saved by the fact that approximately 800,000 ‘Howard battler/true believer’ votes went to One Nation and not to the ALP.

Due to One Nation Party’s total lack of a preferencing strategy in the 1998 federal election, this party thankfully failed to consolidate as Australia’s third force. One Nation was also undercut by Hanson’s failure to win the lower house seat of Blair. (In the 1998 federal election, One Nation only won a single Queensland Senate seat and this poor outcome was due to ALP preferences placing this party last).

Even though the ALP had failed to win the 1998 federal election, it entered the new federal parliament in an ebullient mood under its popular leader Kim Beazley. The former Finance Minister was a respected political figure and his avuncular personality starkly contrasted with the arrogance and hubris that Keating had projected. The returned Howard government between 1998 and 2001 continued to stumble along and the Prime Minister still failed to positively impact on the public.

What coherent direction came from the government was derived from Costello’s disciplined pursuit of implementing a GST. The prospect of a GST being brought in was an understandable source of great anxiety to coalition MPs. When the GST legislation was passed in June 2000, popular dissatisfaction with the tax was such that, in Liberal Party ranks, there was a fear that the party would be near obliterated to a point similar to Canada’s Progressive Conservatives in the 1993 elections in which they were reduced to two seats!

It was also notable that, during the time of the GST legislation’s passage in June 2000, Howard publicly praised Costello in parliament. However, the praise that the Prime Minister offered Costello was subtly duplicitous in that his intention to apportion any unpopularity for the GST to the Treasurer was still apparent. The fact that Howard might have been prepared to undermine Costello was a harbinger that the Prime Minister might not honour his secret December 1994 undertaking to stand down. At this point, the validity of such a deal was academic because the ALP seemed destined to win the next federal election which was due in 2001.

Howard’s Ship comes in: The Tampa Affair, 2001

That the ALP lost the 2001 federal election was one of the great, if most disturbing election upsets in Australian political history. The issue of race, or more specifically refugee asylum, ensured the coalition’s victory in the November 10th 2001 federal election. In late August 2001 a Norwegian freighter the Tampa rescued over 430 refugees in international waters from their sinking, overcrowded, wooden fishing boat. The refugees were rescued 140 kilometres from the Australian territory of Christmas Island. Under international maritime law, Australia was obliged to grant refuge (even if temporary) to imperilled refugees because her territory was the closest land destination.

The crew of the Norwegian Tampa vessel acted honourably and humanely by rescuing the predominately Afghan refugees. The Howard government’s refusal to grant asylum to the refugees was a breach of Australia’s international legal obligations.

This breach was considerably compounded when Australian Special Forces forcibly boarded the Tampa and deported the refugees to the island nation of Nauru, New Zealand and later Papua New Guinea. (The forced entry of special forces personel was justified at the time on the pretext, later shown to have been a lie, that the refugees were throwing their children overboard). Even though the Federal Court of Australia ruled that the government’s actions were illegal, the Howard government still refused to recoil from them. Legislation was therefore passed on September 12th which retrospectively legally validated the government’s actions.

Howard utilized the adverse international re-action to his handling of the Tampa affair to drum up sufficient nationalist sentiment to win the November election which he had entered as the underdog. The government’s action was essentially an unstated signal (a ‘dog whistle’) to former One Nation supporters to give their votes to the coalition instead of returning to the ALP. The Labor opposition was aware of this and the opposition leader Kim Beazley forfeited the opportunity to honourably lose the election by belatedly (and counterproductively) endorsing the government’s Tampa actions.

Even amongst first generation migrants and their children, there was support for Howard as the refugees were often described by them as ‘queue jumpers’. The only parliamentary parties which acted honourably during the Tampa affair were the Australian Democrats and the Greens Party. Malcolm Fraser also stood out as an isolated but distinguished figure in condemning the Howard government with regard to the Tampa affair. In this respect, Fraser was acting in a manner similar to Sir John Kerr by placing the national interest ahead of his personal interest.

Any moral qualms that the federal coalition had about its handling of the Tampa affair were not apparent in the jubilation of its election night celebrations. Peter Costello can, (almost), be forgiven for his delight that the government had won re-election against previously overwhelming odds. The other important leader who was understandably jubilant was Howard.

The Howard Ascendancy 2001 to 2007

Following his 2001 election victory, Howard assumed an authoritive confidence, which had been previously and markedly lacking, in his handling of the cabinet, media and in his domination of the parliament which was uncannily similar to Menzies. The usually taciturn Howard also gained a social confidence in his interaction with the public, redolent of Hawke at his most charismatic and engaging. The Prime Minister’s remarkable transformation was, however, to prove very detrimental to Costello.

The returned coalition government also seemed to have a political and economic ascendancy following its 2001 re-election. Utilizing the windfall of GST revenue, the federal government became very astute in its dispersion of largess. The post 2001 minerals boom that Australia enjoyed during this bonanza era was effectively harnessed by Costello as a massive revenue raiser which filled the government’s coffers.

Near full employment was also achieved following the coalition’s 2001 election victory. A caution should be made with regard to heralding the achievement of full employment. Undertaking a minimum of one hour of paid work a week in Australia constitutes been registered as officially being employed. Furthermore, job growth in this period was in the service sector and was predominately part time and casual. (Casual employment is where an employee is hired on an hourly basis).

Employment growth was impressive that there were labour shortages in the service and mining sectors of the Australian economy. Sections of Australian society, such as young people and university students, did experience the ‘problem’ of not knowing what job to take because there were so many to choose from! This seemingly golden economic boom time was not a period of contentment for Costello because Howard refused to step aside as Prime Minister.

Costello’s political frustration first became manifestly apparent in July 2003 at the time of Howard’s sixty-fifth birthday which he had previously mooted as a point at which he might consider retiring as Prime Minister. Howard’s formulaic response, which eventually became a mantra, was that he would stay on as Prime Minister so long as his party wanted him to lead it.

The Treasurer’s re-action in July 2003 to Howard’s desire to hold onto office was to paraphrase Howard’s ambiguous ruling out of a leadership challenge to Peacock in 1985. If Costello thought that clever and cryptic word games were to be a launching pad for a leadership challenge, then he was to be grievously disappointed.

Liberal Party factions were (and are) more fluid than ALP factions. Howard was thereby able to use the patronage and authority of his office to co-opt notional Costello supporters. The federal member for the Melbourne seat of Menzies, Kevin Andrews, was thought to be a Costello supporter but he transferred his allegiance to Howard as did the socially wet South Australian Senator, Amanda Vanstone. Furthermore, Costello’s practice of ensuring that Liberal branches aligned to him were tightly controlled frightened too many sitting Liberal MPs who did not formally belong to the Costello faction. These MPs were anxious that, if Costello succeeded Howard as Prime Minister, they might later be dislodged.

For all Costello’s disquiet, the federal government still functioned very effectively due to Howard’s leadership projection. Liberal Party Head Quarters (HQs) at state and federal levels were very efficiently run and were (then) intensely focused on retaining power at a federal level. (The Liberal desire by 2004 to win at a state level was ambiguous, to say the least, and certainly not as pronounced as with regard to winning in a federal context). The effectiveness of Liberal Party HQs was centrally determined by the ability of paid staff and this compensated for the fundamental erosion of rank and file power that had occurred at a branch level.

The advantages of incumbency, a booming economy and a disciplined political machine with which the Liberals went into the 2004 federal election with were advantages that were enhanced by public unease concerning the then ALP leader Mark Latham. This opposition leader, similar to Evatt, had a destructive streak. This later became manifestly apparent with the publication of his ten year old political diary (‘The Latham Diaries’) following his retirement from Parliament in 2005. Latham criticised nearly everyone cited in his diary entries including previously close supporters.

Public unease with Latham was the central theme of the Liberal Party’s 2004 re-election campaign. The aggressiveness with which Latham shook hands with Howard during a brief encounter during the 2004 campaign seemed to confirm suspicions concerning Latham’s unsuitability to be Prime Minister.

The coalition’s 2004 election victory in contrast to the 2001 result, although a source for Liberal jubilation, seemed anti-climatic. Nonetheless, the government’s re-election did have the profound negative consequence – the passage of the Work Choices industrial relations legislation. Senate preferencing arrangements between the two major parties in the 2004 election laid the foundation for the Senate’s approval of the Work Choices legislation in late 2005.

No Choices: The Howard Government’s Work Choices Legislation

The passage of Work Choices was a fundamental blow against employee rights and Australian industrial democracy which had once led the world. To be fair to Howard, he had never hidden that his industrial relations agenda had been to introduce non-union enterprise bargaining (which the Keating government actually did in 1993), individual contracts and award simplification.

Howard had however always earnestly claimed he sought these industrial ‘reforms’ to boost productivity. He also pledged that a coalition government would never remove an award safety net. At the very least, the Work Choices legislation constituted a departure from Howard’s stated undertakings. (This raises the question of whether Howard’s ostensible shift in industrial relations policy constituted the breaking of a ‘core’ or a ‘non-core’ promise).

The Work Choices legislation was a radical departure in Australian labour law because the interstate powers of the Constitution were abandoned as the source of industrial relations law. In their place, the corporations’ power of the Constitution was invoked. As a consequence, the safety award net was removed and prescriptions against what employees/unions could bargain for and rights they could access were severely compromised to the point of being denied.

Draconian restrictions on union right of entry and union organising came perilously close to violating Australia’s adherence to International Labor Organization (ILO) freedom of association obligations. Perhaps the most disturbing aspect of the Work Choices legislation was that its removal of an award safety net in effect abolished the guarantee of a minimum wage and basic employee entitlements. A pseudo safety net was introduced just before the 2007 federal election but a by now sceptical public (including the ‘Howard battlers’) saw through the charade.

There had been Liberal MPs such as Petro Georgiou (the federal member for Menzies old seat of Kooyong) who bravely spoke out against the mandatory detention of refugees. It is a pity that Liberal moderates such as Georgiou did not also publicly oppose the Howard government’s industrial relations agenda. To have done so would have been a re-affirmation of Menzies legal legacy (which was previously cited in this article) as a barrister as it was he who had secured a court decision which had activated the interstate powers of the Constitution and facilitated Australian industrial relations arbitration.

The abandonment of arbitration was not to be the only fundamental point of departure of Howard with regard to betraying Menzies legacy. Howard betrayed the Menzies tradition with regard to states’ rights. In this regard, Howard was the ideological successor not to Menzies but to Gough Whitlam! It had been Whitlam’s grand plan to replace Australian states with regional governments. Howard’s pursuit of this agenda and his inability to control it is the key to understanding his seemingly improbable defeat in the November 2007 federal election.

Lemmings Over a Cliff: Howard’s End, 2007

There is a theory that Howard was taken with the notion that he could secure continued political security at a federal level if there were ALP state governments throughout Australia. The logic behind this assumption was that the electorate would always re-elect a federal coalition government as a counterbalance to ALP dominance at a state level. The fatal undermining of Liberal Party local branches through the denial of rank and file power certainly provided the scope for Liberal Party state HQs to potentially sabotage state election campaigns.

The March 2007 New South Wales election campaign is a very interesting point of analysis. New South Wales is Australia’s most populous state and an economic powerhouse. After twelve years in office, the ALP deserved to lose office in New South Wales due to economic mismanagement and glaringly apparent political fatigue. The 2007 New South Wales Liberal election campaign was mind bogglingly inept to the point that one could be forgiven for thinking that the Liberals deliberately lost the state election.

(The conduct of the Liberal campaigns in the 1999 and 2002 Victorian state election campaigns also warrant investigation because patterns for the conduct of the respective New South Wales state and federal 2007 campaigns may have been set).

If Howard thought that his power base, the New South Wales Right of the Liberal Party, had done him a favour by losing the 2007 state election, then he would have cause to think again. The bounce that Howard may have expected from his hosting of the Asia Pacific Economic Cooperation forum of world leaders in September 2007 in Sydney was to be rudely shattered. During the hosting of this very important international event, a delegation of senior ministers met with Howard and called on him to resign!

The delegation consisted of Foreign Minister Alexander Downer, the Defence Minister Brendan Nelson, Immigration Minister Kevin Andrews and Workplace and Employment Minister Joe Hockey (who represented Peter Costello). Two of the ministers (Hockey and Nelson) came from New South Wales but their representation to Howard had the backing of the New South Wales Right faction of the Liberal Party.

The official account of Howard’s fall maintains that Foreign Minister Alexander Downer, at Howard’s request, investigated the sentiment toward him in the federal parliamentary party room and found that consensus was for a leadership change. This in turn precipitated a federal delegation of senior Liberal parliamentarians meeting with Howard in September 2007 and asking him to resign in favour of Costello. This version holds that Howard refused to and that his respected position in the party compelled the delegation to reluctantly accept Howard’s decision.

Another scenario was that the delegation informed Howard that the federal parliamentary wing had withdrawn their support for him in favour of Costello. Howard was able to stave off being replaced by Costello due to the Treasurer’s refusal to accept the Prime Ministership. In return for this important concession from Costello, Howard publicly announced that he would stand down during the course of the next term if his government was returned and would support the Treasurer as his successor.

Costello’s decision not to depose Howard in September 2007 was shrewd. The Treasurer would have realized that he would not have had sufficient support within the Liberal Party to have won an election campaign as Prime Minister. Costello had revealed in July 2006 that he had made a secret agreement with Howard that he would step down as Prime Minister during the second term of a coalition government. This agreement (as previously cited) was witnessed Ian Mc Lachlan, who later served as Defence Minister.

If Costello’s revelation of the 1994 agreement was supposed to provide the impetus for a leadership challenge on his part against Howard, then it spectacularly fizzled. The response of the federal parliamentary wing in 2006 (including members of the September 2007 delegation) had been to rally to Howard. It did not take a rocket fuel scientist to realize that it was logical that those who had denied Costello in 2006 would also have denied him an election victory as Prime Minister in either late 2007 or early 2008.

The public Howard/Costello succession plan, made in the heat of an abortive leadership coup, could have provided them with the necessary latitude to have made necessary changes in state and federal Liberal Party HQs and gone to a federal election in March 2008. However, Mr. Costello made pre-emptive announcements both at the last September sitting of the federal parliament and at the official Australian Football Rules Grand Final Breakfast that there would be a November federal election. These announcements forced Howard to call a November election into which he went without the full support of his party.

Mr. Costello Stays Afloat as Howard Sinks

Mr. Costello may well have calculated that Howard was going down anyway and it was best to allow the man who had consistently thwarted him to sink politically.

Colossal mistakes which beggar belief were made during the October and November of the 2007 election campaign. A series of television and radio commercials were run reminding the electorate of previous interest rates rises under the ALP at the very time when the Reserve Bank of Australia had announced interest rate rises!

Remarkably, despite the ineptitude of the Liberal Party campaign, there was still a chance that Howard could still have won the 2007 election campaign due to a reservoir of good will toward him by parts of the electorate who had prospered under his governments. This scenario was blasted out of the water when, three days before the 24th of November federal election, seven Liberal campaign workers were caught handing out fake pamphlets endorsing the ALP on behalf of a non-existent Islamic extremist group.

Two of the apprehended campaign workers were Gary Clark and Gary Chijoff, the respective husbands of Jackie Kelly, the retiring member for the federal seat of Lindsay and Karen Chijoff, the Liberal candidate for that seat. Jackie Kelly had previously been Howard’s ‘golden girl’ by winning the apparently safe ALP seat of Lindsay in the 1996 election. Lindsay was in western Sydney which was a key battle ground between the ALP and the Liberals for the true believers/ Howard battlers.

Kelly’s previous electoral success had been an indicator that the Liberals were holding the crucial lower middle class swing vote. The impending loss of Lindsay had the knock-on psychological effect of determining the 2007 federal election in the ALP’s favour.

Howard’s shaken demeanour at a subsequent news conference on the eve of the federal election conveyed his despair that he knew he would not only lose the federal election but also his own seat of Bennelong to the prominent former ABC journalist and current affairs host, Maxine Mc Kew. The disappointment which Howard projected at his pre-election news conference contrasted with his composure on election night when he conceded that the coalition had indeed lost the election. (Howard would also lose his seat of Bennelong to the ALP).

In making his concession, Howard in the ultimate of ironies called on Costello to assume the leadership of the Liberal Party! True to the perverse pattern of tragedy which characterised the political relationship between Howard and Costello, the latter declined.

These two major political figures will probably continue to spar as to which out of the two of them, can claim pre-eminent credit for the economic prosperity that Australia enjoyed after 2001, as reflected by the budget surpluses. (Costello can legitimately claim credit for fine tuning banking prudential controls in 2007 which were vital to Australia weathering the Global Financial Crisis).

Costello’s subsequent refusal to assume the leadership of the federal Liberals in opposition could have been derived from his realization that the underlying cause of Howard’s defeat remains in place: the reluctance of the New South Wales Liberal Party Right to win power at a federal level.

John Howard and the Whitlam Continuum

This reluctance could well reveal the mystery of why Howard lost the 2007 election. Howard was Australia’s second longest serving Prime Minister (after Menzies) and its second worst Prime Minister (after Whitlam). For all Howard’s ostensible admiration of Menzies, he ended up emulating Whitlam due to his determination to replace Australian states with regional governments and to consequently centralize power in Canberra.

Unfortunately for Howard, the New South Wales Right faction of the Liberal Party calculated that it would be in a stronger position to represent Liberal Party/non-ALP interests when the transition to a regionalist system of government is undertaken without there being a federal coalition government in office. Consequently, the current Liberal Party leader, Malcolm Turnbull, will not be allowed to win the next federal election due to opposition by elements within the New South Wales Right of the Liberal Party. However, the New South Wales Liberals will undoubtedly win the 2011 state election due to the deplorable condition which the state is in, under the ALP.

An analysis of the Howard government’s key decisions shows that they all related back to the objective of centralizing power in Canberra. The revenue raised from the GST since its introduction in 2000 has been passed onto the states. However, a motion passed at the Queensland Nationals 2008 state conference called on GST revenue to be transferred onto local government. (Elements within the Queensland Nationals support regionalization). Such a policy outcome – that of diverting GST revenue from the states to future regional governments probably was the key motivation behind Howard introducing this tax in the first place.

The other area of policy which was driven by Howard’s centralization agenda was with regard to industrial relations. Work Choices was not only reprehensible because it undermined key democratic industrial rights but also because it terminated the inter-state sources of constitutional power that had underpinned the arbitration system.

The centralization of Australian industrial relations power through the use of the corporations’ power of the Australian Constitution has led to a situation which has rebounded on the proponents of Work Choices who wanted to crush employee rights. The corporations’ power is now the source of industrial power for Deputy Prime Minister Julia Gillard’s new Forward with Fairness (FWF) industrial legislation (which took effect in July 2009). As a result, a new and potentially very powerful industrial relations tribunal Fair Work Australia (FWA) has been created.

The FWA tribunal could be the determiner and enforcer of whether employers adhere to the FWF legislation’s requirement that EBA’s be negotiated in ‘good faith’ with unions and/or employees. A potentially de-unionising danger of having an all powerful ‘one shop’ industrial relations tribunal is that it could become a means by which employees by-pass unions with regard to fulfilling representative functions on their behalf. The FWF legislation could well spell the end of an arbitral approach to industrial relations and thereby fatally compromise union effectiveness.

The Howard government’s colossal mistake with regard to centralizing industrial relations by utilizing the corporations’ power of the Constitution may well be replicated by the Liberals and Nationals if they sell out Australian states by endorsing ‘regionalization’ (sic).

Predominately left wing industrial amalgamated unions will have a greater capacity to win control of future regions due to financial and industrial resources. Left wing dominance of regional governments will also be facilitated because of the extensive reach of left wing social movements. Their superior collectivist organisation will enable them to gain control of regional governments to utilize as patrimonial sources of control.

A Liberal Party endorsement of regionalization will constitute a massive betrayal of Menzies legacy. This is because Menzies’ great political achievement was to create a viable party which could actually represent the interests of its members and therefore often benefit society. Contemporary Liberal Party power brokers and business tycoons (including media moguls) may believe that the power of corporations will both safeguard and advance their power within a regionalized Australia. However as contemporary events in Venezuela under the Hugo Chavez regime are demonstrating, corporate business power cannot effectively counter an organised far left which is underpinned by access to patrimonial resources.

The political ramifications of ‘regionalization’ (sic) will be such that the non-left elements of Australian society will be perpetually disadvantaged with regard to having their interests represented. The ‘non-left components’ of Australian society also encompass the moderate elements of the ALP. Moderate Australian unionism was substantially undermined by the onset of the Marxist driven policy of union amalgamation in the 1990s. In a similar vein, social democrats within the ALP will not have the inclination or the resource capacity to run regional governments.

Moderate ALP members who initially become involved in regional governments will ultimately only be able to sustain their position by subordinating themselves to the SL of the ALP. A potentially fatal consequence of ‘regionalization’ (sic) could be bringing out the worst within non-SL elements within the ALP in relation to pursuing an intensely patrimonial approach to politics as a form of compensation for their lack of ideological intensity.

Malcolm in the Middle

Similarly a transition to a ‘regionalization’ could bring out the worst in the Liberal and National parties. Liberal Party faction leaders within state branches might see apparent benefit in emasculating states to accrue patronage at a new regional level of government. Such an approach could well generate a corrupt approach to politics and ultimately see the Liberals go the way of the UAP. In this context Malcolm Turnbull (despite previous doubts concerning his Liberal Party bona fides) may go down in history as one of the great Liberal Party leaders if he blocks regionalization.

The national newspaper, The Australian, as it did when it moved against Howard in 2007, is now attempting to fatally undermine Turnbull and set the Liberal Party’s future leadership direction. The current media destabilization campaign against Turnbull may have been precipitated by his rumoured attempts to impose his authority on Liberal Party HQs. If Turnbull does succeed in this endeavour it may not guarantee a Liberal Party victory at the next federal election, but will at the very least avoid a certain defeat.

The coalition’s Treasury Spokesman Joe Hockey would be a prize idiot if he was to take the Liberal Party’s federal leadership from Turnbull. This is because Hockey would never have the requisite authority to win a federal election. A political elimination of both Turnbull and Hockey could well pave the way for Tony Abbott (who has already publicly adopted an anti-states position) to become a future opposition leader and provide the necessary bi-partisan support for a re-elected ALP federal government to bring in ‘regionalization’ (sic).

The current destabilization campaign against Turnbull is ostensibly based on his support for an Emmissions Trading Scheme (ETS). I confess to having insufficient scientific knowledge concerning global warming. However I am certain that the National Party’s opposition to an ETS is not scientifically based.  Rather the Nationals opposition to an an ETS is politically motivted to ensure that Turnbull is politically motivated so that ‘regionalization’ (sic) can come in. (This political objective is probably also shared by avowed climate sceptics in the federal parliamentary wing of the Liberal Party).

The Nationals are already promoting themselves as the champions of ‘regional’ Australia. However ‘regional’ Australia will eventually become ‘patrimonial’ Australia. The Nationals endorsement of ‘regionalization’ (sic) is reflective of the fact that their vote is declining and this party wants to extend its patronage reach to avoid political oblivion.

There are already nascent signs in South Australia of the Nationals moving toward a patrimonial approach with its lone state Member of Parliament (MP) holding the vital Water Ministry in coalition with an ALP state government. (The Water Minstry is very important because water desalination plants are crucial to South Australia). Hopefully a political future does not emerge in Australia in which SL -led ALP national governments can maintain a political dominance through dispensing patronage to regional governments which are based on various Liberal and National Party factions.

In essence Australia has been able since the population influx of the 1850s to maintain its economic viability and political freedom by there being a disconnect between political control and control of natural resources.

The Australian colonies came to a cross-roads due to the massive immigration that arose from the 1850s gold rushes. Dominant pastoral intersts (’the squiretocracy’) who had held economic power attempted to perpetuate their political power by utilizing the British Crown as a political tool for their own ends. Very fortunately, the British Crown in the 1850s, instead became the lynchpin for the Australian colonies becoming Westminister parliamentary democracies with male universal sufferage. (Australia was the second nation after New Zealand to grant female sufferage in 1902).

The accumulated wisdom that came from nearly fifty years of democracy (which was then ahead of its time) was crucial to the Australian colonies electing experienced and  knowlegeable constitutional delegates to draw up a democratic federal constitution that was approved by popular referendum in 1900. The achievement of Australian federation was reflective of how the constitutional links to the British Crown enabled Australians to devise a political system suited to their needs. The democratic quality of the Australian Constution was also derived from the constitently transparent processes which were undertaken in drawing it up.

By contrast the contemporary moves to facilitate ‘regionalization’ (sic) are being underataken by stealth. A prominent manifestation of duplicity is now being undertaken by so-called Australian monarchists (including John Howard) calling for the introduction of a ‘Crowned Republic’.  The oxymoronic concept of a ‘Crowned Republic’ is one in which the constitutional link between the Australian Governor-General and the British Monarch would eventually be severed and the vice-regal representative become a prime ministerial cipher.

A severance of the constitutional connection to the British Monarch will also fatally compromise the viability of the Australian Constitution by eliminating the carriage of constitutional conventions which come from the Crown.  Contemporary calls for federal legislation to be passed to make the Governor-General Australian Head of State constitute the beginning of a  process that will  ultimately concentrate power with politicians at the expence of popular sovereignty.

Although Turnbull can never be converted away from his republicanism he could at least ensure that Australia’s long standing political freedom is safeguarded by opposing regionalization and defending the integrity of his party from political manipulation.  Because it is absurd to dispense with Australia’s excellent Constitution the strategy being pursued by the new aspiring elite is to fundamentally change the nation’s political system by eliminating checks and balances which have stood the time. If Malcolm Turnbull is a genuine Australian patriot then he must fight for political  transparency. Standing up to those within his party who have covert agendas (such as ‘regionalization’) would be a crucial first step in Turnbull (even if he is a republican) being a worthy political leader.

New South Wales: The Premier State?

The election of a New South Wales Liberal government in 2011 could be the point at which the regionalization process commences in earnest. The question which emerges is that if non-ALP interests within the regionalization process will be primarily represented by the New South Wales Liberal Right faction, who will represent the ALP’s interests? At the moment, it would appear to be the SL faction within the Rudd government led by Deputy Prime Minister Julia Gillard. (The Rudd government’s announcement that it intends to take control of public hospitals from the states could be an indication that prerequisites for regionalization are already being undertaken).

Even if the New South Wales Liberals win a landslide in the 2011 state election this may not ensure future Liberal dominance. It should not be forgotten that the Victorian ALP was routed in the 1992 state election with an expectation that the party would not return to office for a generation. That the ALP won the 1999 Victorian state election was partly due to the very successful strategy of focusing on winning local government to facilitate party renewal.

Although the New South Wales state ALP are seemingly headed toward being pulverized at the 2011 state election the introduction of regionalization (sic) by a future state Liberal government could precipitate a an incredible stregthening of the left of the labour movement in that state. Left-wing industrial amalgamated unions in industrial centres, such as New Castle, could gain dominance of a future regional government in that area. Under scenarios such as these the political power that moderate white collar unions have within the Westminister system of government would eventually evaporate.

Each time the politcal position of the leading member of the New South Wales ALP Right and former senior state minister John Della Bosca has been undercut has seen the SL strengthen in the state. The undermining of Dellla Bosca’s political position in turn has created the scope for the SL to gain their ascendancy over the New South Wales ALP Right by eroding the state’s viability by transferring important state powers and responsibilites to Canberra.

The Rudd Ascendancy?

It should not be forgotten that Rudd’s ascension to the leadership was facilitated by majority support from the SL faction of the ALP. Julia Gillard had demonstrated great leadership skill in keeping Mark Latham’s inter-factional parliamentary support base together after his departure as ALP leader in 2005. Not only did Gillard hold the support of a majority of SL caucus members but she also made in roads into the moderate Labor Unity faction.

Gillard’s support base within Labor Unity was bolstered due to the support that she gave Simon Crean when it seemed he would lose ALP pre-selection for his federal seat of Hotham in 2005. Crean had served as ALP federal leader between 2001 and 2003. It looked as though Crean would lose pre-selection when senior members of his own Labor Unity faction (including Kim Beazley, who had returned to the ALP leadership in 2005) abandoned him. The former Labor leader unexpectantly won preselection by securing the support of regular ALP branch members.

The support that Gillard gave Crean could be replicated within the current federal government in relation to the SL exercising substantial influence (if not dominace) over the moderate wing of the ALP. The recent decision (September 2009) by Prime Minister Rudd that printing and airline travel allowances for federal MPs would be curbed could lay the groundwork right wing MPs to link up with the SL to undermine Rudd.

There was nothing inherently wrong with the Deputy Prime Minister endorsing the decision of an independent remuneration tribuanal granting a three percent pay increase to federal politicians. However the dissatisfaction that non-SL federal ALP MPs may feel regarding the curbs placed on printing and air travel allowances and Gillard’s implicit endorsement of the parliamentray pay increase reinforce strategic links her and the Labor Unity faction.

A worst case scenario forAustralia would be that of the SL utilizing patronage to undermine a sense of critical direction and purpose on the part of their less ideolically formed associates in Labor Unity. Whatever the future political ramifications of the recently annouced parliamentary pay increase federal MPs from both sides of politics could voluntarily forgo the increase. Such an action would be more than a gesture to those who barely on less that $300 a week (such as pensioners) and could help ensure that Australian politics does not to move toward a patrimonial approach which regionalization (sic) would ultimately entail. (Th massive level of foreign public debt and the fact that Australia is still ‘not out of the woods’ economically in the wake of the Global Financial Crisis makes it imperative that a patromonial approach to politics be avoided at all costs).

With regard to Gillard’sprevious actions her support for Crean in 2005 was morally commendable but there was a pragmatic dividend for her in that the former leader was sufficiently respected within the ALP federal caucus for him to win over members from Beazley should a viable leadership alternative emerge. That alternative leader who eventually arose was Kevin Rudd.

The future Prime Minister was a former diplomat and a former senior official in an ALP Queensland state government. He had been elected to federal parliament in 1998. He had assumed the Foreign Affairs shadow portfolio in 2001 and drawn attention as an articulate, if at times verbose, parliamentary and media spokesman.

Rudd’s support base within the ALP federal caucus was initially small but he somehow managed to gain the committed support of some SDA parliamentarians. This in turn helped Rudd to expand his base in federal caucus to include members of the New South Wales ALP Right. Although Rudd’s support base within Labor Unity was a minority one, he had still broken into previously impregnable bastions within Beazley’s power base: the SDA and the New South Wales ALP Right.

The support that Rudd had garnered was sufficient enough that by December 2006 he was able to link up with Gillard supporters to depose Beazley. Although Gillard had more supporters within the ALP federal caucus, she cleverly supported Rudd who held the balance of power. Gillard’s support for Rudd was also shrewd because the earnestness he projected was very re-assuring to the public. Furthermore, as a Queenslander, Rudd offered the ALP the best hope of picking up seats in that crucial state. In essence, Rudd was the closest approximation to an ALP version of Howard who could win over swinging voters.

The fundamental question concerning Rudd is whether he (or Australia) will have to pay a price for his political alliance with Gillard. Deputy Prime Minister Gillard, who is Education Minister and Minister for Employment and Workplace Relations, has virtually established a government within a government.

The Rudd-Gillard government is currently functioning very well. This effectiveness has been partly attributed by some political insiders to a Rudd/Gillard succession plan. Under this plan, Rudd – after securing the ALP a second term- will hand power over to Gillard and assume a prestigious international post. Such a scenario is viable because the Deputy Prime Minister’s intelligence and affability are sufficiently apparent that most Australians are now prepared to accept her as their first SL Prime Minister!

The Fork in the Road: Which Direction Mr. Rudd?

Regardless of Gillard’s leadership qualities, a caution must still be sounded with regard to her SL affiliation. Leaders of the SL faction of the ALP are dedicated to undertaking fundamental constitutional/structural reform via regionalization. Prominent federal Liberal MPs such as Tony Abbot have already challenged the need to retain viable Australian states. It is therefore plausible that Liberals such as Abbot could provide a future Gillard led government with the necessary bi-partisan support to bring in regionalization.

The recent public airing of rumours that the Prime Minister wanted to be a future Secretary-General of the United Nations may have put pay to the viability of Rudd assuming that diplomatic posting. However, for Rudd to step down in a possible future second term government would be dereliction of duty. Rudd may have initially assumed power on a transitional basis but the ramifications of either him-leaving office to allow regionalization to come in- would be disastrous. The reasons as to why are outlined below.

The outstanding achievements of the Howard-Costello era were paying off Australia’s public foreign debt and accumulating a massive surplus. It will never be known if Costello, holding office as either Prime Minister or Treasurer, could have deftly handled the Global Financial Crisis without plunging Australia into debt and deficit. This is a moot point due to its hypothetical nature but important in the context that Rudd and Swan are responsible for the high levels of foreign debt that have accrued.

Prime Minister Rudd’s deft handling of the Global Financial Crisis has confounded critics who had derided him as a spin doctor. The stimulus packages were manifestations of economic social action because their impact probably avoided the scourge of mass unemployment and generation of widespread poverty.

It is still an open question as to whether Australia will have capacity in the future to service the debt that has been accumulated and which now challenges Australia’s long term financial and political viability. There may be senior SL federal ministers who promoted the stimulus packages as a means of indebting Australia so that the viability of future regional governments will be dependant on foreign sources so that those in Australia with international connections will ultimately hold power. In this context Ministers opposing measures to oppose foreign debt reduction should be treated with suspicion.

The scenario which must be guarded against at all costs is that of federal and state governments of either party using the massive debt burden as a pretext to facilitate the formation of new regional governments in the place of states. Such a transition has its superficial attractions. For political hacks, regionalization could facilitate a centralization of power and the consolidation of their power at a local level. Foreign financial and political interests could well gain a point of entry as a funding source for future regional governments which would only serve to compound Australia’s foreign debt burden.

The role of federal and state governments is to be responsible to the people whose interests they are supposed to represent. There was a disturbing lack of transparency with regard to the Whitlam and Howard governments which threatened to fatally rupture the interests between the government and the governed. The economic stakes are too high for such a separation of interests to re-occur.

If Rudd is to avoid the scenario of his name (and that of his Treasurer Wayne Swan) being cursed by future generations of Australians then he must not betray the people’s interests. Australia has a wonderful existing system of federal government which was formulated for and by the Australian people. Any future move to use Australia’s massive level of foreign public debt as a pretext to introduce regionalization will constitute a massive betrayal of the Australian people by their political leaders.

The challenge of overcoming Australia’s public foreign debt is one that requires the highest calibre of political leadership. Peter Costello was possibly Australia’s greatest Treasurer. (The other prime candidates are Paul Keating and Sir William Mc Mahon, the latter served as Prime Minister from 1971 to 1972 and put up a sterling fight against Whitlam in the 1972 federal election campaign).

The Menzies Legacy: Worth Fighting For

Sir Robert Menzies was arguably Australia’s greatest Prime Minister and, if this accolade legitimately belongs to some else (Deakin, Curtin or Hawke), then Menzies can legitimately claim to be known as the nation’s most important political leader. This is because Menzies utilized his talents throughout his political career to safeguard Australia’s system of government, regardless of the personal cost to himself.

A prerequisite of Menzies’ outstanding leadership was his preparedness, similar to Sir Winston Churchill’s, of staying the distance by remaining in the political mud pool. In this context, for all his immense talents, Costello ultimately did not measure up to Menzies due to his reluctance to stay the course when his leadership was required. The question remains as to whether the same can and will be said of Kevin Rudd.

Dr. David Bennett is the Convenor of Historical and Current Affairs Analysis (HCAA), the Editor of Social Action Australia Pty Ltd and the International Liaison Officer of the Australian Monarchist League (AML). The interpretations and opinions expressed in this article are those of Dr. Bennett.