AS OUR agile, innovative, laissez-faire, small-government Prime Minister grapples with the contradictions of regulating gas exports and propping up the dying coal industry with public money, people might ponder anew the question of who has been the worse Coalition Prime Minister in recent history. Malcolm Turnbull himself? Tony Abbott? Billy McMahon?
No, no and no.
Surely, when you look at the history, the distinction must go to John Howard. When you look back, you see that virtually every governmental trouble afflicting Australia now has had its genesis in one or other of the Howard government’s policies.
Where do we start? Perhaps with one of the worst government decisions made since the Vietnam debacle, namely the decision to commit Australian forces to the Second Iraq War.
In the past fortnight, Fairfax Media has revealed the proof of what we had already strongly suspected – that Howard led us into Iraq just to please the Americans and that the decision was based on a falsity.
That decision cost a lot of blood and treasure and sucked Australia into the vortex of terrorism. Also the disclosure of the deliberate reliance by a government on false intelligence, it significantly contributed to the corrosive distrust of government – an issue which continues to afflict us. Remember he was called “mean and tricky” by one of his own team.
It is the new norm. The 2014 Budget was mean. Blaming blackouts on renewables is tricky.
The Iraq decision led to the expensive and liberty-reducing “war on terror” – still continuing.
Other Howard poor defence decisions were the construction of the Defence Headquarters Joint Operations Command in a paddock in the marginal electorate of Eden-Monaro, and joining the troubled US-led F-35 Joint Strike Fighter program at vast unnecessary cost .
Let’s go wider afield. On housing affordability, Howard introduced the capital-gains-tax concession; bolstered the first-home buyers’ grant; and boosted immigration – all putting pressure on housing demand. The graphs show that investor entry into the housing market took off from the moment the capital-gains-tax concession began. We wallow helplessly in the backwash of these idiotic decisions.
Speaking of tax, Howard introduced the over-60 superannuation tax holiday, other superannuation concessions, family payments to middle-income households, age-based tax concessions, and lots of income-tax breaks for middle to higher income households. These have been difficult if not impossible to wind back and they have increased inequality in Australia.
In short, he squandered the mining boom on buying votes and allowing miners to be lightly taxed.
In education, he dramatically increased Federal funding to private schools which they largely spent on non-educational luxuries. He starved public schools. The result is the worsening scores Australia has been getting on national and international testing. Again, it has been difficult to unwind because of the demand that “no school should be worse off” which Julia Gillard was forced to acceded to.
In health, his government corroded Medicare by misdirecting money into tax deductions for inefficient private health insurance. Again, hard to unwind. Howard set the stage for the present return to the 1960s in the health system – one in which many people cannot afford to pay for health care.
We now bemoan the casualisation of the workforce, under-employment, and low wages growth. A lot of that is down to Howard’s industrial-relations policies culminating in Work Choices.
With infrastructure, Howard was a master of the pork barrel. The Regional Partnership Program was biased towards Coalition and marginal seats. We have mentioned the DHQJOC. The priority given to the Alice-to-Darwin railway was another iconic spend in a marginal seat, instead of being part of the orderly construction of a national rail network in which the Melbourne-Brisbane link was the obvious priority.
The misspend is still sounding in infrastructure deficits today. It took Labor to set up Infrastructure Australia to expose the pork barrels and put a bit of economic rationality into the system.
He started the politicisation of the Public Service when he sacked six department heads upon coming into government. It was followed by Abbott when he sacked three department heads on coming into power. Again, a bad Howard precedent becoming the new norm.
In Indigenous Affairs, the Howard legacy was the abolition of ATSIC; the intervention; the failure to say sorry to the Stolen Generation and the mishandling of constitutional recognition.
On other iconic questions he created historic mischief. He divided and ruled on the 1999 republic referendum instead of being a national leader. He demanded his party members vote for an antiquated definition of marriage and we still have division in our society when our English-speaking and European friends and allies have all grown up.
He joined a liberal party when it was what he called a “broad church”, then in power systematically removed everything left of the nave and made it the conservative party in which Malcolm Turnbull is having difficulty finding a pew.
Yes he did gun control, but that was fairly easy in a nation just shocked by the largest mass gun murder in history to that date.
Yes, Australia broke records for continuous GDP growth, but again fairly easy after the Hawke-Keating reforms and a mining boom.
Yes, he did the GST, but only half the job that New Zealand did because of the Senate. But he did not revisit it later when he had a Senate majority.
Returning to energy. Howard followed the US out of the Kyoto agreement. He reluctantly agreed that a carbon tax would be worthwhile but did nothing about it. He encouraged the states to privatise electricity and in 1998 set up the National Electricity Market based on market principles – meaning electricity network owners, suppliers and retailers could screw consumers and small business.
In all, a do-nothing ditherer like Turnbull or McMahon is a better proposition than someone who put in train changes which have made Australia a poorer, less equitable place and which have been very difficult to undo.
Paul Keating got it right when he said, “When you change the government you change the country.” Never was that more true than in 1996. And this week’s electricity debacle is just one example of it.
This article first appeared in The Canberra Times and other Fairfax Media on 18 Mach 2017.