ADDRESS to 2023 Chifley Conference, Canberra
Friends, almost without us noticing it, this year will be the 15th anniversary of the collapse of Lehman brothers; the signature event of the Global Financial Crisis and ensuing Great Recession.
Ever since then, I’ve believed that you can divide economists and economic policy makers into two groups: those who’s views of how the economy operates and how we should make economic policy were changed by the GFC; and those who remained untouched.
I’ve got a handy shorthand for the latter – you and I know them as charlatans.
There are quite a few of them among our political opponents. This points to another important fact. Our opponents are not just economic charlatans for the fun of it; their ignorance is both deeply deliberate and deeply ideological.
John Maynard Keynes once quipped that when the facts changed, he changed his mind. He was famously scathing of those who didn’t, and we should be too.
Put simply, the trickle-down economics that dominated so much of the pre-crisis consensus worked very well to deliver for conservative parties around the world, and for the interests they represent.
Trickle-down economics is one way of putting it. Or as John Kenneth Galbraith said more pungently, “if one feeds the horse enough oats, some will pass through to the road for the sparrows”.
Now you will all be fortunate to hear an address by my great friend and Labor Treasurer Jim Chalmers on Sunday.
I can’t recommend highly enough a long article he has just penned for the Monthly, summarising what the discipline and practice of economics globally and here at home has learnt from the last decade and a half since the crisis. You should go and read it, but allow me to summarise in two words: not enough.
Jim’s point – and I couldn’t agree more – is that you change economics with facts on the ground. Governing, and governing well, for the people who put us in government, is the best way to learn the lessons of the crisis.
It also happens to be the best way of crisis-proofing our economy for the future.
So I want to issue a challenge to all of us today.
Labor has never had a better opportunity to dispel the myths of trickle-down economics and present a clear and compelling argument for a prosperous society with a long term federal Labor Government.
To successfully do that we must build our movement and make our Party much larger, vibrant and imaginative.
A society built from the bottom up, not from the top down, cannot endure unless it is supported by a Party that is much larger, dynamic and with membership spread across the country and across the demography of modern Australia.
And we know in our bones we can’t have a prosperous economy with a shrinking share of national income going to working and middle class Australians.
The rising tide of fascism and right-wing populism is directly linked to the concentration of wealth at the top. Though we may have a Labor Government, Australia is not immune from these forces.
Galbraith called conservatism “the search for a superior moral justification for selfishness.”
The constant attempts by conservatives to demonise mainstream tax, industrial relations, superannuation and climate policies as anti-business is one social democrats cannot afford to let stand.
The old-thinking trickle-downers claim that redirecting resources to the top of the income and wealth scale is the best chance of sharing with everybody else.
A rising tide lifts all boats, they like to say.
Being a surfer, I happen to know a bit about tides.
Tides never rise from the top down. They rise from the bottom up.
Progressive taxation, decent wages and the social contract are the foundations that make aspiration possible for all Australians, not a privileged few.
Without these policy frameworks aspiration is the dream most people tell their children to forget.
So continuing to win the battle of ideas is essential if we are to secure our aspiration for long term Labor Government, to deeply embed social democratic reforms that survive the inevitable electoral cycle.
Our victory last year was historic. Labor has only won Government from Opposition five times in a century.
This March we celebrate the 40th anniversary of the Hawke Government, last year we celebrated the 50th anniversary of the election of the Whitlam Government, and the 15th anniversary of the Rudd Government election.
Since the end of WWII Labor has occupied the Treasury benches for just over a third of the time.
During the terms of all of these Labor Governments powerful vested interests challenged and challenged again significant Labor nation-building reforms – think Medibank and Medicare, progressive personal and corporate tax systems, the industrial umpire, strong and effective unions, a decent minimum wage, effective and enduring climate action and the shift to renewable energy.
The international energy crunch and its impact on domestic inflation wouldn’t be crushing family budgets and endangering our domestic manufacturers if we had maintained the hard decisions of 2012 to start and then accelerate the transition away from fossil fuels and towards new renewable sources of energy.
Short term thinking and the political power of vested interests sunk good long term social democratic policy.
It’s our obligation as supporters of progressive policy change to ask what we have to do to broaden and entrench community understanding of our values and the policies that underpin them.
This isn’t just a question of political tactics – it’s about how we win the battle of ideas for the long haul.
Its about what institutions and processes we need to work through to elect and re-elect long term Labor Governments so our big reforms survive the electoral cycles.
Too frequently too many of our supporters, and much of the public discourse, underestimate the power of the tide of ideas.
As Patrick Diamond reminds us in his definitive study of modern British Labour, ideas provide the intellectual scaffolding for our vision and our programs - they project clarity of purpose, enable us to build coalitions of support, shape the strategy of policy makers, help define community wisdom and determine the boundaries of legitimate political action.
For Labor there is no sturdier scaffold than a strong and vibrant union movement, working with and within a thriving Labor Party to drive greater equality and opportunity in our society. It is how we were formed, and it is how we must continue if we are to edge society ever closer to Chifley’s ‘light on the hill’.
Now is the time for Labor to draw strength from our proud history of nation building and take head on the extreme left and the extreme right. That is the role of Australian Labor – to dominate the centre and centre left where everyday Australians live their lives.
At the core of our politics is a debate about the size and the degree of government intervention in the economy and in our society.
Despite what those seeking to rewrite history may tell you, Australian Labor has never embraced a third way ideology of minimum social safety nets and deregulated labour markets evident in the United States and Great Britain.
Labor’s belief in and commitment to a vibrant public sector working with and alongside the private sector is the best way to grow the economy and preserve economic accountability and mobility.
The campaign from the far left and the right to demonise and devalue Labor’s substantial achievements over barely nine months of government is already in full swing.
The far left seek to paint our government as neo-liberal in the tradition of Thatcher and Reagan, while the Trumpified Liberal Party seeks to characterise the government as anti-business and trending to some form of Wokeish Marxism!
The far left is only too happy to assist with constant criticism of Labor’s already substantial policy achievements. As ever, in tearing down Labor’s efforts, they are letting the so-called perfect be the enemy of the extremely good.
Our government has taken dramatic steps in unwinding the downward path of the Coalitions trickle-down project. With action on minimum wages and enterprise bargaining, increased ambition in climate targets, increases in investment in renewable projects and new support for re-industrialisation in key sectors.
When you strip away the theatre and noise, politics is ultimately the struggle to make your ideas the prevailing orthodoxy of the day.
We are not alone in this struggle. Globally, many of our sister parties are in an uphill battle with the radical right. The rise of fascism in Europe and notably in the US Republican Party isn’t just a localised problem, but rather is spreading around the world.
Here in Australia the tide is rising for us and we have the solutions for the challenges ahead. The environment is tremendously tricky, yet the previous LNP Government on its good days did nothing, and on its bad days actually made things worse. But we are winning the battle of ideas.
The 2022 federal election saw a realignment on the conservative side of politics, with the conservative inner city, wealthy heartland moving to independents as well as tactical voting by Labor supporters to defeat entrenched Coalition Members.
In the years ahead the imperative for Labor is to strengthen our primary vote across the country in every electorate, not just our traditional safe seats or indeed marginal target seats. A healthy Labor primary is vital to the health of the party – you can think of it as our pulse.
Around the world, including in Australia, there are too many low income working class voters supporting conservatives against their own economic interest. In doing so, ordinary people are voting for authoritarian leaders who are a threat to democracy.
This is a trend that we simply cannot ignore and must urgently reflect on.
It is chilling, for example, that in the United States Democrats have lost a substantial portion of working-class voters, particularly in outer suburban and regional areas.
Any party that allows itself to no longer be representative of a nation’s geographical, educational and income diversity will soon find it is no longer in the business of government.
At home prophets of doom have been handwringing about Labor’s primary vote eroding to catastrophic levels. We are not in an inevitable and permanent decline the likes of which the US Democrats or the Liberal Party experienced in the last elections.
But that could be our fate if we do not learn some of the stark lessons evident in the last two federal election campaigns.
To defeat the radical right we must rejuvenate the centre left. In surfing parlance, we have to paddle like buggery to get the next wave.
We’ve got a good PM, Cabinet and Caucus and we are better connected to middle Australia than many centre-left parties around the world are to their societies.
But we still have a massive job to do because radical conservatism will say and do anything to survive. And the Liberals are getting more extreme by the day.
Disturbingly across both state and federal campaigns in recent years Labor has gone backwards across some, but not all, outer suburban and regional lower income communities.
In the last federal election, compared to 2007, Labor performed more strongly in middle ring and inner city seats.
We did however underperform our 2007 result in regional seats and many traditional outer suburban marginals – particularly in Queensland and Tasmania.
Ultimately we need to lift out primary vote across diverse parts of the country. We need to recruit and retain significant numbers of new members, particularly in those outer-suburban and regional areas.
If we do not fix this problem, then securing healthy Labor majorities will become increasingly difficult.
We must build a movement and a Party internally that will allow us to win the battle of ideas. We cannot get stronger as a movement by getting smaller as a party.
In too many parts of the country our membership base is too small, too narrowly concentrated and our presence too shy.
In Queensland our membership of 11,000 has to grow, and it particularly needs to grow in those areas of the state where population growth is strongest.
Our membership is also ageing and already concentrated in the older age brackets. A party that does not renew itself cannot hope to exist in the long-term.
The South East Queensland Coast is a stark example of this problem.
In 1972 the Sunshine Coast had two state seats and the Gold Coast three. In 2020 the Sunshine Coast has eight seats and the Gold Coast 11.
In this area, Labor has three state seats out of the 19 and no federal representation. Great surfing beaches but our Party representation is at low tide.
The excellent work done by our friend and colleagues Greg Combet and Lenda Oshalem and their team looking at last years federal election result will help us tackle these realities.
This fight can’t be won without a dedicated strong and larger party and membership organisation. To win, we need an army of Labor people. And we must build it together.
We can’t always rely on good leaders to pull us through, we have to rebuild our appeal from the ground up.
The Labor party and the labour movement can only survive through building a strong coalition of low and middle income earners backed by a wave of growing unions and growing party membership.
We can take heart from Labor’s federal victory last year. It proved Labor values are still Australia’s values.
Ultimately, we won because we reconnected with our traditional base: the unskilled, the skilled, the professionals, idealists, women and the young.
But we did not win enough of these votes across the country to be confident of delivering the healthy parliamentary majorities we require for the re-election of long term federal Labor Governments.
Our ambition must be to defeat the Trumpified Liberal Party comprehensively in the years ahead such that they reform or die. And it can be done.
Hawke and Keating won 5 elections on the trot. Losing and losing well may provide the tonic the conservative side of politics requires to finally break their fever.
Our success next time round will rely on building and sustaining a larger party
This is the task that Federal Labor, through think tanks like Chifley and through the campaign apparatus of all our state branches, must undertake in the years ahead.
As Labor Party members we should be waking up every day and looking for ways to energise our movement, our cause and our values.
We need a new generation of activists drawn to our Party by our policy framework that delivers for the nation and its working people.
First, if you are in NSW get active on that campaign.
Second, get involved in the Referendum campaign.
Third, be part of the contest of ideas, sign up and turn up to the Think Tanks, reward the good thinkers with your support, like, share and donate of course.
The tide is rising, the sets are forming out the back, lets paddle hard, stand up and show what we can do.
