QUARTERLY ESSAY 40 Trivial Pursuit

 

Correspondence

Tim Dixon

George Megalogenis has made another first-class contribution to public debate with his essay on the politics of reform. His deeply perceptive account of recent political trends captures many of the frustrations with today’s politics. He also puts his finger on many of the causes – the relentless media cycle, the perpetual polling and trivialisation of political debate.

The troubling part of Megalogenis’s essay is where it takes us. It tells us that the golden age of reform is gone and we’re condemned to a diminished era of pea-hearted politicians and pea-brained journalists. (If only we could have the ’80s back – that age of big hearts, big brains and big hair.) 

You can accept much of Megalogenis’s analysis without necessarily embracing his dark conclusion. There’s another explanation for why change seems more difficult these days – namely, that while our national debate embraces the importance of reform, we haven’t absorbed the lessons from the past about how governments succeed in delivering reform. We need to better learn those lessons and adapt them to today’s different social, economic and political environment.

I suspect that past reforming governments faced obstacles every bit as great as today’s – it’s just that those obstacles seem smaller when viewed through the lens of history. Progress to universal health-insurance coverage was held up for decades by powerful doctors’ groups; for years the states’ rights lobby prevailed over sensible national standards; and tax reform always confronts a wall of opposition – in the mid ’80s we were even told that the ceiling would fall in on Australia’s restaurant industry if we removed tax breaks for fancy business lunches. 

Genuine reform is never easy and never popular. Whether it’s harder today than in the past is a moot point. It always requires engaging the public, taking on powerful vested interests, building a coalition of supporters, thinking strategically, executing carefully and showing the odd flash of imagination. 

It’s a good thing that reform continues to be a key theme in Australian politics – and Megalogenis’s essay is only the latest significant addition to this debate. It is a distinctive feature of Australian political debate that we often judge governments on the basis of their reform achievements – whether it’s the gold standard of the Hawke/Keating era, the mixed record of Howard or the weaker record of the Fraser era. Of course, we will sometimes also debate what actually constitutes reform – for example, I find the argument that WorkChoices was an economic reform implausible (surely it was just raw politics, a conservative attack on Labor’s base; though conservatives too might challenge the inclusion of social and environmental policies in Labor’s reform agenda). But the fact that reform is a central concept in Australian debate helps lift our policy focus beyond the scoreboard politics of fortnightly polls, and reminds us that governments of either side can contribute to the long-term national good. 

Yet the odd thing is that for all the talk of reform, we rarely get beyond the generalities to discuss how it’s actually done. Megalogenis’s essay convinces me that the debate needs to move beyond the platitudes to a more substantive assessment of how past governments succeeded in overcoming the obstacles to achieving change. Perhaps there is room for a little more optimism – perhaps the breakdowns in the reform process are less about character deficiencies in today’s careerist parliamentarians, as Megalogenis’s essay suggests, and more because people have underestimated the strategic challenges involved in prosecuting reforms. 

Politicians will rightly say that governing is always difficult. It’s a cliché of working in a political office that politicians moan about the difficulty of the issues on their desk, while political advisers cheerfully tell them that the only reason why anything gets to their desk is because it’s difficult and couldn’t be resolved further down the chain. By definition, government is always about the tough stuff. 

But reform is the really hard stuff, and I think during the current Labor government’s first term in office we underestimated how hard. Reform is of a different order of magnitude to the day-to-day hard stuff – the need to get the media lines out, return calls, respond to opponents, read wads of briefings, deliver speeches to a hostile audience, prepare for an appearance on Q&A and comment on the latest NRL scandal or Shane Warne’s break-up. These things can all look difficult and urgent, but they blow away with the wind. 

The really hard stuff is developing and prosecuting reform – because it requires complex, strategic assessments that are beyond what departments or youthful advisers can provide. It also demands time frames hardly imaginable to people in jobs where the time horizon rarely stretches more than a few days ahead. It’s hard to wrap your head around ten- and twenty-year time frames for reforms like putting a price on carbon, modernising our schools or reforming water allocation when in the short term those issues seem to represent only trouble. But this is exactly where a government’s best strategic and policy brains need to be engaged. Think of how the reform agenda of the Hawke era was honed through lengthy, lively debate in a cabinet loaded with intelligence, policy grunt, political smarts, broad life experience, strong values and a long-term horizon. There’s a great depth of talent in today’s cabinet as well, and harnessed effectively it can provide the strategic vision for prosecuting reform. 

On the basis of the successes and failures of past years, I’d suggest eight high-level priorities that are key to prosecuting reforms successfully. 

First, a government must identify the problem it is solving, must explain it in vivid and memorable ways, and must allow that explanation to settle into the public consciousness. The community won’t support difficult reform if it doesn’t understand the problem that it’s resolving (a key factor in the debate on the mining tax). Achieving public awareness can take time, and only after this should the government step in to provide a policy solution – consider, for example, how the Howard government successfully positioned the GST in 1998 as a response to an upsurge of community pressure for tax reform. 

Second, reform should be sequenced through a realistic time frame measured in years and not months. Big reforms require patience – so there’s enough time for raising public awareness, releasing discussion papers, consulting interest groups, drafting legislation, negotiating parliamentary approval and implementing the reforms step by step. Establishing reasonable expectations up-front about the sequence can prevent later delays in the reform process building momentum to scrap the reform altogether. 

Third, the case for reform should be made from values, not just from facts and abstract technical details. Important reform must always be part of a much larger story about our nation and our future – a story that resonates with ordinary Australians’ lives. For example, the strongest argument for the National Broadband Network may well be our national belief in the “fair go,” because an NBN is the only way all Australians will have access to the twenty-first century education, health, entertainment and job opportunities delivered by super-fast broadband.

Fourth, the reform proposition should be radically simplified to just a couple of very compelling sentences. If a government cannot explain its reform in a sentence or two, you can be sure its opponents will successfully characterise it in different terms (“great big new tax” catches on more quickly than a definition of emissions trading). One of the hardest communication challenges is to simplify complex reforms without sounding too cute or too glib – and provoking a backlash from a public sceptical of politicians who sound slick and over-rehearsed. In designing its broadband infrastructure policy, the government got it right by using the workman-like labels “NBN” and “NBN Co.” and thereby communicating simply and clearly its purpose. 

Fifth, the prospects for reform are often enhanced when there is a reform package that goes some way to compensating losers and delivering reform dividends – such as the tax cuts and welfare increases introduced alongside the GST in 2000, or the measures to boost the social wage in the 1980s when the Prices and Incomes Accord was restraining wage growth. Compensation for losers should generally be for a limited time (e.g. the dairy industry) or transitional (e.g. the manufacturing and tariff cuts), or else it can undermine the very purpose of reform – a point often made in the debate around the emissions trading scheme. 

Sixth, reform always needs champions. As the Treasury has long argued, economic reforms usually involve big losses for a small group, and small gains for a big group – so you can be sure the losers will have the loudest voices. Given the diminished credibility of governments and politicians, they should never try to carry the case for reform by themselves. As long ago as the 1980s, the Hawke government showed the effectiveness of building a broad reform coalition, including the Business Council of Australia and the union movement, to create a sense of inevitability about its program. Supporters should be engaged and deployed so that the national interest case for reform is heard from the widest possible range of voices. 

Seventh, reform almost always confronts powerful vested interests – whether they are particular businesses, industries, groups or organisations. The government should anticipate the way those vested interests may try to defeat the reforms and, where necessary, pre-empt them. Opponents of reform should be respectfully and intelligently engaged, and efforts should be made to identify any forward-looking leaders within a sector who might go against the grain and support reform because it’s the right thing, regardless of their sector’s vested interests. Once a government has decided on the final shape of its reform package, it must be willing to tough it out, since any willingness to make further concessions will only intensify the efforts of the opponents of reform. 

Finally, lasting reform requires successful execution and the refusal to back down. Attention to detail is important to prevent policies being derailed by implementation gaps – as the current government learnt from its first term. Governments must also be willing to ride out the initial waves of opposition. As Megalogenis notes, election outcomes – as opposed to fortnightly polling – suggest the electorate ultimately respects a government that sticks to its guns. 

When you assess many of the big reforms of the past quarter-century against this list – such as tariff cuts, tax reform, industry deregulation, enterprise bargaining, superannuation and national competition policy – you see a clear pattern to successful reform. Of course, it will always be difficult and there’s no simple formula for success – but the prospects for success are increased when governments go about the reform in a determined, strategic and methodical way. I suspect that even the political hard-heads who otherwise tend to oppose ambitious reformers can be convinced of the merits of reform if they are shown a robust strategy for achieving it – just as hard-heads like Graham Richardson were a generation ago.

There’s another reason why I’m more optimistic than Megalogenis. Sure, our 24/7 media environment may exaggerate opposition, thwart reform and make it difficult to sustain a national conversation. But social media and communication technologies have also opened up new opportunities to engage the public directly and mobilise support. In the past, it might have been possible to win reform debates just by engaging the media and the elites. Today, governments – or the causes they support – must engage people directly in ways most relevant to them, and in ways that move beyond the top-down approach of traditional media strategies. At present, those instruments are scarcely used at all outside of election campaigns. Deployed creatively, they could help at critical moments in the reform process, like key parliamentary votes.

George Megalogenis’s essay is a great contribution to the reform debate, but let’s not accept that the reform era is over. Yes, we need a few more idealists and a few less careerists in our political process; yes, governments need the patience to endure seasonal dips in the polls; and yes, critically, more rigour is needed in developing the strategy to deliver reform. But let’s also be realistic – this is still a young government, and it’s a little premature to make sweeping assessments of its record of long-term reform. Labor deserves a bit of credit for putting reform back at the centre of political debate in recent years, and for sticking its head above the parapet and pushing for big changes in its first term. Even if some fell over, other long-term initiatives have been pushed through: modernising the award system, school reforms, telecommunications competition and significant national transport and infrastructure reform. There’s much more to build upon from Labor’s first term in office. This new decade still can build a legacy of valuable, long-term reform. 

 

Tim Dixon worked for prime ministers Kevin Rudd and Julia Gillard, and for opposition leader Kim Beazley, as speechwriter and senior economic adviser from 2005 to 2010. He is the author of Australia’s best-selling series of school textbooks for economics students and currently works in New York for purpose.com, a home for technology-based political movement building.

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This correspondence featured in Quarterly Essay 41, The Happy Life .


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