Leaders locked at negotiation table
Both leaders are facing the biggest negotiations of their political careers, attempting to gain the support of four independents.
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The election result challenges the parties to decide what they stand for.
It's 70 years since Australians have voted in a hung parliament. It's unusual for us, but normal for most Western democracies. Their experience shows it doesn't necessarily lead to weak government. If there is discipline and realism among the partners, it can lead to reforms with a wider base of support than any one party can muster. We had it here in Victoria just a decade ago: in Steve Bracks's first term, a minority Labor government governed with the support of three independents, and did so well they were re-elected with the biggest majority since the 1960s.
New Zealand has had minority governments since 1996, yet it has delivered tighter fiscal policy than we had here. In Germany, the last Social Democrat-Greens coalition under Gerhard Schroeder and Joschka Fischer pushed through pension reforms that were far tougher politically than anything we have seen in Australia since the GST.
Illustration: Andrew Dyson
Making minority government work is one challenge facing whoever emerges with 76 secure votes in the 150-member house. Two other challenges are to manage the widening political divide across Australia, and for all four parties in the new house to redefine what they stand for - and whether we are now moving to a three-party system, or even a four-party one.
In Victoria, South Australia, Tasmania and the ACT, the government was re-elected emphatically. After preferences, 55 per cent of Victorians voted for Labor - its highest two-party vote in the 25 elections from 1949. So did 53.5 per cent of South Australians, the highest Labor vote there since 1969. And so did 60.9 per cent of Tasmanians, also the highest since records began.
But in Queensland and Western Australia, people voted equally decisively for a change of government. In both states, after preferences, 55 per cent voted for a Coalition government. Only NSW was evenly divided: 49.6 per cent voted for Labor, 50.4 per cent for the Coalition.
The regional divide itself is nothing new. In Victoria, Labor has won the two-party vote at 10 of the past 12 federal elections. In Tasmania, it has now won seven straight. And the nation's capital has only once voted Liberal: in 1975, after witnessing three years of the Whitlam government.
Conversely, Queensland has voted for Labor just three times in the past 25 federal elections; and WA just four times - three of them when Perth-raised Bob Hawke was its leader. No other states lean so consistently to one side of politics.
Labor has had far worse elections in both states. In 1975, the anti-Whitlam rout left it with just one seat in each of them. But the divide between the south-eastern states and the resource states has never been greater.
It's not about emissions trading: an Age/Nielsen poll last month found overwhelming support in both Queensland and WA for Labor's scheme. The mining tax is obviously a factor: yet the Labor seats in the other big coal mining area, the Hunter region, recorded almost the smallest swings in NSW.
Unpopular and incompetent state governments clearly hurt Labor in Queensland and NSW, especially in Sydney, where the impact was magnified by the rabidly anti-Labor views of the talkback radio hosts and the Murdoch tabloids. (And conversely, the lack of any anti-Labor swing in Victoria suggests the Brumby government is heading for re-election on November 27.)
But the election outcome also challenges all four parties to redefine what they stand for. Labor began life as the party of the working class, then gradually morphed into an alliance between the unions and middle class progressives, yet has now morphed again into a party of careerist managers camped in the political middle ground, between the Greens on the left and the Liberals on the right.
One of the turning points in this election was Labor's decision in April to drop the emissions trading scheme, one of the two most important promises behind its 2007 victory.
Lenore Taylor in The Sydney Morning Herald revealed that the decision was pushed by then deputy prime minister Julia Gillard, Treasurer Wayne Swan, NSW Right leader Mark Arbib and ALP national secretary Karl Bitar. Finance Minister and MP for Melbourne Lindsay Tanner strongly opposed it. Kevin Rudd finally gave way. Cabinet learnt of the decision only after it was reported in the SMH.
Labor's leaders today are pragmatists, with no principles too precious to trade off for power. The Greens are a party of principles without pragmatism - as shown by the way they have lifted their target for cutting Australia's emissions in 2020 from 20 per cent, to 30 per cent, and now 40 per cent. But they have the balance of power in the Senate now, and a member in the house; if Labor continues along its path, he could be followed by more.
Germany's Greens began as idealists, but then the realists won out over the fundamentalists and it became a party of pragmatic idealists. Will Australia's Greens do the same? Or will Labor decide to rebuild its base and reoccupy the progressive ground? The first seems to me more likely.
The Liberals and Nationals also have issues to face. This is the worst the Coalition has polled in the three south-east states since the 1940s. Scare campaigns don't work so well here, and the Coalition's policy was largely a four-pack of scare campaigns. Where was the progressive liberalism of its past?
And with Nationals rebel Tony Crook elected in WA promising to vote independently of the Coalition, the Nationals must ask themselves again: what is the point of having a National Party, if the Liberal Party decides what it does?
Tim Colebatch is Age economics editor.
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