Tony Abbott was elected Liberal leader to defeat the Rudd Government’s disastrous carbon tax legislation; but to succeed he will need to define a vision for Australia which distinguishes the Liberals from the Labor Party.
It was clear that if Malcolm Turnbull had remained leader, he would have divided the party irretrievably on the issue of support for the Rudd Government’s new emissions tax and would have presided over what Senator Nick Minchin described as a “train wreck” at the next election.
Tony Abbott was a reluctant candidate. It was only the failure of Joe Hockey to declare unambiguously that he would oppose Rudd’s misnamed Carbon Pollution Reduction Scheme and stand against Malcolm Turnbull as leader that forced Abbott’s hand.
There never was any good reason why the Coalition should have supported an emissions tax, the burden of which will fall on Australian industry and businesses. If low-income earners are protected from the impact of the scheme, as Kevin Rudd proposes, then the burden will fall even more heavily on middle-income earners, as Professor Ross Garnaut, the Government’s climate change expert, has repeatedly pointed out.
Abbott’s narrow victory is a sign that a majority of his party want to go in a different direction.
For Kevin Rudd, the defeat of Malcolm Turnbull represents a problem, because Turnbull’s presence as leader of the Opposition guaranteed Labor a second term of office.
Mr Rudd’s immediate temptation will be to call a double dissolution election to capitalise on the divisions which Turnbull created in the Liberal Party, both by his ferocious attacks on his Liberal Party colleagues, and by his “crash through or crash” declaration that he would not lead a party which did not support him on the emissions trading scheme.
For Mr Abbott to credibly face such an election, he will have to articulate to mainstream Australia a credible alternative to the Rudd Government — an alternative which is pro-family and pro-business.
There are a number of issues which would enable him to do this, in addition to his opposition to Rudd’s emissions tax.
Tony Abbott should oppose the Reserve Bank’s recent decision to increase interest rates in Australia, which will cut the disposable income of the most vulnerable people in Australia, such as owners of small businesses and families with children.
It will also have the effect of pushing up the Australian dollar, damaging Australia’s exports and causing a further flow of “hot money” into Australia from overseas, encouraging further speculation on the Australian dollar.
Second, he should take a stronger stance against people-smuggling, by reinstating the Howard Government’s policy of off-shore processing of asylum-seekers, which is far more humane that forcing them into detention centres in Indonesia or squeezing them like sardines into Christmas Island.
Third, he should promote policies which would address Australia’s foreign debt crisis, which even the heads of Australia’s biggest banks concede is unsustainable and a threat to the economy. He should aim at winding back the Rudd Government’s stimulus package and reducing Australia’s dependence on imports, which has contributed to the country’s unsustainable balance of payments deficit.
Two measures here would have an immediate impact. The federal government should establish a national development bank which would raise capital for vital infrastructure works such as urgently-needed dams and reservoirs, telecommunications infrastructure including the national broadband network, base-load electricity generation, roads, rail and ports.
A development bank could also assist the expansion of the mining industry, to keep ownership in Australian hands and minimise reliance on investment from China.
In Australia, even governments lack the capacity to fund basic infrastructure works, which is why the Queensland government is trying to sell off existing infrastructure, and the NSW Labor government is trying to sell its power stations.
Additionally, the federal government should follow the example of New South Wales, and introduce a buy-Australian first policy, to provide an immediate boost to Australian manufacturers.
Australian retailers who introduce a similar policy should be given tax breaks by the federal government.
While this is regarded as economic heresy by devotees of free trade, the United States Congress adopted “Buy American” provisions in the economic stimulus package carried early this year. And the US Congress regularly affords direct subsidies to US agriculture, permitting it to undercut competitors (including Australia) in world markets.
This is an agenda which most Australians would unite behind. Mr Rudd himself might even adopt some of these policies.
Peter Westmore is national president of the National Civic Council.