Albanese is running Australia like a low-energy state premier

Worse, the public pain from higher inflation has only just begun. If Coolabah Capital’s analysis is correct, by March household savings end and the real pain begins.

But the Albanese government would be foolish to blame its problems solely on interest rates. Their problem is their model of governance.

Albanese is running Australia like a low-energy state premier.

There are lessons for the Opposition too.

Over the past two decades Labor has perfected the model of governance over states. Their economic model was state budgets that replenish themselves every time a spending commitment is made. State governments treated public spending like it was a magic pudding.

It meant every special interest could be bought today with money borrowed from tomorrow, particularly public sector unions.

It was all fine while debt was cheap. But last week Victoria revealed it had added $1 billion per month to its debt and NSW Labor had blown out its deficit by 60 per cent in four months.

If global investors are wary of US government debt levels and are demanding higher yields from the world’s largest economy backed by the reserve currency to, what chance do our national or state governments have?

PM is the biggest problem

Profligacy became more politically saleable than productivity reform. And while the performance of education and health systems declined, so did the scrutiny to expose it.

As the drift of power from state capitals headed to Canberra, so too has the scarce resourcing of media companies.

State premiers can hide, and the public can barely name state treasurers. Prime ministers and federal ministers are not so lucky.

State governments hide from scrutiny by turning on and off the tap of access to journalists based on their compliance. That can’t be done in Canberra because competition between the media is so fierce. Some journalists knowingly relegate themselves to be the contrarians.

But, arguably, the biggest problem is with the prime minister himself. Public expectations couldn’t have been lower for his election. Victory depended on not being his predecessor.

The state Labor model has been to push the leader to the front and centralise decision-making in their hands. The worst example has been Dan Andrews. Whatever anyone thinks of Andrews around Melbourne’s golf courses, he always projected competence.

Similarly, incompetent ministers were able to disappear into obscurity with incompetence easier to get away with when the public doesn’t know who you are.

Whereas Mark Dreyfus, Clare O’Neil and Andrew Giles discovered recently Canberra shines a spotlight when you’re found wanting.

The prime minister seemingly wanted a cabinet government, but a cabinet still needs to be led. He has never demonstrated an interest in the finer details of policy. In Opposition, that isn’t an issue.

Less stability

As prime minister, it matters because ministers never know whether he will support the positions they take. And the prime minister’s office concurrently isn’t developing a central purpose or narrative for the government to guide them.

State Labor governments might have secured longevity ambling through Australia’s salad days, but the buck stops in Canberra and so does the model when taken national.

There are lessons for the opposition too.

If changing the government changes the country, an opposition aiming to topple a government needs to get elected with a plan. Government is temporary and your capacity to implement reform will narrow.

Political cycles are shortening. Voter fragmentation means there will be less electoral stability. Majority government cannot be assumed to be the default. And parties of government can quickly find themselves wagged by their tail.

The luxury of developing a reformist agenda as a re-election strategy is now too pricey.

And all while the long-term challenges our nation faces are extending: from national security threats, the role of technology and the workforce, artificial intelligence, the retreat of globalisation and the availability of basic services from housing to healthcare.

Unless we want managerialism perfected by lackadaisical state governments, we will need aspirant prime ministers and governments that are prepared to lead.

Tim Wilson, a former Liberal MP, is completing an Economics PhD at RMIT’s Blockchain Innovation Hub, Jason Falinski, also a former Liberal MP, is a partner at economics consultancy Ergo Videatur.