Six weeks before July’s federal election, in a shopping plaza in suburban Australia, a Liberal candidate intercepted a middle-aged woman as she carried her modest purchases towards the carpark. Would she care for a shopping-list pad with the candidate’s smiling face and the Liberal Party logo printed at the top? The customer politely declined but took the opportunity to speak her mind. Why was the party she had supported at every election since 1996 trying to grab a slice of her retirement savings?
This was not Mosman, Toorak or Peppermint Grove, and the woman displayed no sartorial signs of conspicuous wealth. This was hardly the kind of constituency where the rule changes were supposed to bite.
“Would you mind saying what line of work you’re in?” the candidate ventured.
“Public transport,” replied the woman. “I drive buses. And in the evenings I help out at an aged care home.”
Pencils lingered uncertainly over ballot papers in the federal election as the Forgotten People pondered which candidate—if any—was on their side. An eight-week campaign conducted, or so it seemed, in a foreign language had left them none the wiser. Innovation, excitement, agility—the words evaporated into the ether without ever hitting the spot. The conversations that mattered seemed to be happening behind their backs.
Tony Abbott may not have won their hearts, but the manner of his departure was deeply resented. Malcolm Turnbull’s unassuming promise—jobs and growth—hardly justified the change. To top it all, the Liberal Party, the party of thrift, enterprise and self-sufficiency, was sending confusing signals; was it for or against the sober and industrious middle class?
In the weeks after the election the party seemed reluctant to face its own failings. Superannuation, the members’ talking notes insisted, had not been a factor in the election. Indeed, the notes continued, the party had performed well in affluent and ageing constituencies.
It was an exercise in self-delusion, as every marginal-seat campaigner knew; the problem with the superannuation measures was not tax-brackets or tax-breaks, it was sentiment. For the party of Robert Menzies to penalise thrift, however slightly, and discourage the people who strive to help themselves, sent morally discordant signals.
Superannuation policy was not the Coalition’s only fumble in the last three years; nor was it by any means the worst. Were a medical autopsy to be conducted into the Coalition’s near-death experience, superannuation would be but one item in a long list of contributory factors that would spill over half a dozen or more supplementary pages stapled to the back. Its significance however is not in its scale or the severity of its consequences but in its spirit. Few other unforced errors rubbed so awkwardly against the philosophy of Australian Liberalism. No other decision could be as easily repudiated with a simple reference to Menzies’s own words.
This essay appears in the September issue of Quadrant.
In his fireside chats to a nation in the midst of war, Menzies established the manifesto of the party he would help create. It would learn from the mistakes of pre-war governments, including those in which he himself had served. In particular he would address the failure to pursue policies “designed to help the thrifty, to encourage independence, to recognise the divine and valuable variations of men’s minds”:
there have been many instances in which the votes of the thriftless have been used to defeat the thrifty … we have hastened to make it clear that the provision made by man for his own retirement and old age is not half as sacrosanct as the provision the State would have made for him if he had never saved at all.
We have talked of income from savings as if it possessed a somewhat discreditable character. We have taxed it more and more heavily. We have spoken slightingly of the earning of interest at the very moment when we have advocated new pensions and social schemes …
And yet the truth is, as I have endeavoured to show, that frugal people who strive for and obtain the margin above these materially necessary things are the whole foundation of a really active and developing national life. The case for the middle class is the case for a dynamic democracy as against the stagnant one.
Those familiar with the outpouring of intellectual and moral passion that we know as the Forgotten People speech will recall that this section is the prelude to Menzies’s withering critique of the immorality of socialism:
If the motto is to be “Eat, drink and be merry, for tomorrow you will die, and if it chances you don’t die, the State will look after you; but if you don’t eat, drink and be merry and save, we shall take your savings from you”, then the whole business of life would become foundationless.
Menzies delivered the Forgotten People speech on May 22, 1942, two years before the publication of Friedrich Hayek’s The Road to Serfdom. It is a mark of Menzies’s intellectual capacity that he foreshadows Hayek by warning that tyranny is the inevitable consequence of centrally planned state economic intervention. The abandonment of classical liberal principles leads to a loss of freedom, stagnancy and weakening of moral fibre:
Are you looking forward to a breed of men after the war who will have become boneless wonders? Leaners grow flabby; lifters grow muscles. Men without ambition readily become slaves.
Seven and a half decades of experience have vindicated Menzies’s decision to invest his faith in the middle class and their aspirations. Governments don’t deliver prosperity, people do, and they do so more readily when they are lightly governed. The disempowerment of the individual in closed socialist economies, chiefly but not only behind the communist bloc, led eventually to their collapse. Open liberal economies, however, where human ambition and enterprise are encouraged, thrived to produce a degree of affluence that would have seemed fanciful in the 1940s. And in few nations was the converse of socialism practised so exquisitely as in Australia between 1949 and 1972.
The party’s current philosophical malaise transcends the question of leadership. Each of the three Liberal leaders who have struck a prime ministerial pose at the dispatch box in the last twenty years was accomplished and incomplete in his own peculiar ways.
Investing false hope in the coming Messiah is a mistake the Labor Party has been making for the last twenty years. The history of Australia is not, as Thomas Carlyle would have claimed, merely “the biography of great men”. Herbert Spencer appears much closer to the mark with his repudiation of Carlyle’s “great man” theory: “Before he can remake his society, his society must make him.”
Changing leaders, as the Liberal Party has discovered, is an uncontrolled explosion. It changes the fortunes of the party in unbridled and unexpected ways; the collateral cost is high. It does not, however, fix the party’s underlying problems; indeed, in the short term at least, it exacerbates them.
It is also worth noting, though not as an excuse, that Australian conservatives are not alone in their struggle for identity. The recent success of the Conservative Party in Britain—or more accurately England—has been greatly assisted by the Trotskyites who kidnapped the Labour Party after the 2015 election. It has not been without cost. By embracing the zeitgeist of the cosmopolitan sophisticates, David Cameron alienated parts of the party’s provincial base. UKIP, let’s not forget, finished third in the 2015 general election with 12.7 per cent of the vote, two points higher than the Australian Greens managed in July. If Westminster operated on Australian rules, UKIP would be holding the balance of power in a hypothetical British Senate. UKIP’s support, to some extent, represented the Tory base on strike. Cameron’s sticky end over Brexit was inevitable; a leader cannot oppose the general will of party members for long without consequences.
The comparative ease with which Donald Trump managed to take the Republican Party hostage betrays the intellectual and moral weakness at the US conservative core. The economic reform agenda that drove Ronald Reagan and Margaret Thatcher is far from finished—the reform process never is—but the unifying force of anti-communism that held together the broad coalition of conservatives in the 1980s was a little-acknowledged casualty of the fall of the Berlin Wall. Isaiah Berlin observed in 1997 that “for the first time since 1789 the European Left does not have a project”; it has taken another twenty years for the realisation to dawn that sections of the Right are also struggling to find a post-Cold War purpose.
As identity politics fractured the Left into ever smaller and more improbable groupings, tribalism on the Right was having the same disaggregating effect. We are indebted to US historian George Nash for his anthropological classification of the new tribes of the American Right:
neoconservatives, paleoconservatives, “big government” conservatives, “leave-us-alone” conservatives, compassionate conservatives, reform conservatives, constitutional conservatives, crunchy conservatives, conservatarians, Tea Party conservatives, dinner party conservatives—and the list goes on.
From an international perspective, the Centre-Right coalition in Australia was something of an oddity until relatively recently, having remained intact for more than sixty years. The relationship with the Country Party that Menzies forged in the late 1940s had given both parties room to breathe while bestowing the security of a long-term relationship. For Menzies, and later John Howard, the Coalition partnership was the secret to political longevity. The stability of the Centre-Right was tested to the limit in Howard’s first and second terms with the emergence of Pauline Hanson’s One Nation. Howard’s close call at the 1998 election is commonly remembered as a reaction against the GST; it is often forgotten that One Nation captured more than 900,000 votes that year, contributing in no small measure to a 4.8 per cent swing against the government.
Anyone who thought disaffected Liberal voters had nowhere else to go on July 2 clearly wasn’t playing attention; the leakage of the conservative vote cost the Coalition seats. Consider the swings to minor parties in the House of Representatives: 1.8 per cent to the Christian Democrats in New South Wales; 3.4 per cent to the Recreational Fishers in Tasmania; 5.4 per cent to One Nation in Queensland; and a 21 per cent swing to the Nick Xenophon Team in South Australia. Sooner or later someone was going to get hurt.
The search for a new unifying purpose is hardly assisted by the hardening of factional lines within the Liberal Party. If it were a contest of ideas between soft and hard Liberals it might serve a purpose; yet the party establishment—the Left in most states—is intent on shutting real debate down. This is hard-nosed, winner-takes-all politicking; unattractive, unproductive and unhelpful. Talented candidates are deterred from entering the race; factional favours, not merit, dictate the winner. Ultimately these internal skirmishes are exercises in futility; this is not where the 2019 election will be won or lost.
The fault lines on the cultural landscape have changed dramatically since the 1970s and with them the dynamics of politics. The old divisions by which we once understood politics—the proletariat versus the bourgeoisie, blue collar versus white collar, rich versus poor, country versus city, Protestant versus Catholic—have been subsumed by a profound dispute between insiders and outsiders. The development of a distinct political class, university-educated and technocratically minded, drawn from the same narrow subset that supplies recruits to the media, the arts and education, has put distance between citizens and their representatives. As I wrote in my 2013 book The Lucky Culture, politicians, most conspicuously on the Left, have paid a high price for following outdated maps of the cultural landscape, blundering back and forth across the trenches, uncertain of where the battle lines are drawn and unable to tell their allies from their enemies.
Demographic concentration skews the agenda of those living in the elite enclaves, meeting, mixing and chatting with people who think about the world in the same way. It is sobering to note that a quarter of all journalists in New South Wales share a mere fifteen postcodes. They are, in this order, Surry Hills, Bondi, Newtown, Clovelly, Leichhardt, Paddington, Potts Point, Glebe, Balmain, Crows Nest, Marrickville, Mosman, Redfern, Coogee, Erskineville and North Sydney. These suburbs have similar demographic traits: high numbers of university graduates; low affiliation to a religion; high numbers of same-sex couples; a high Green vote. They are suburbs where one can readily find small-batch artisanal pickles but less readily find an artisan to unblock a sink.
Labor, since the days of Gough Whitlam, has progressively detached itself from the suburbs and sought applause from within the macchiato belt. The Liberals’ good fortune under John Howard was to seize the ground Labor had vacated, making inroads into Western Sydney and other working-class strongholds. The brutal mathematics of politics in a system where voting is compulsory is that elections are won or lost in suburbs with double lock-up garages and reverse-cycle air-conditioning.
Labor’s inner-city focus has cost it dearly over the years. Mark Latham noted in his diary after the party’s 2001 defeat: “We abandoned our dialogue with suburban Australia, while the gentrified Left abandoned us for the Greens and the Democrats … A wedge has been driven through the middle of Labor’s ranks.”
The Liberal Party can ill-afford to make the same mistake, yet the evidence from the July election suggests it is in danger of doing just that. A clear pattern began to emerge as the votes were counted: swings to the government or modest swings against it in inner-city constituencies and large swings against it in the outer suburbs and regions.
A line on the map marking the inner-city commuter belt is one of the clearest ways of identifying seats in which the Coalition struggles. Of the fifty-three seats held by the Liberals or Liberal-Nationals in Queensland, New South Wales and Victoria before the election, twenty contained 10,000 or more people who worked in the CBD. In contrast, there were thirty-three outer suburban and regional seats.
The difference in the swings between these two groups of seats was remarkably consistent. The swing against Liberal incumbents was 2.5 per cent worse in the outer suburban and regional seats. Victorian swings were 2.5 per cent worse, Queensland 2.6 per cent worse and New South Wales 3.5 per cent worse.
The party’s poor performance in non-CBD-focused areas almost certainly cost it seats. The LNP was able to hold inner-city Brisbane with a 1.6 per cent swing towards it, but it was unable to hold Herbert, centred on Townsville, where the swing against the party was 6.2 per cent.
The task ahead for the Liberal Party in government is formidable. Its capacity to pass the measures needed to secure future prosperity will be severely curtailed by a recalcitrant Senate. Treading water is not an option; it requires a swing towards the party in 2019 to be sure of holding government. The party’s base is demoralised and disillusioned. The debt mountain appears insuperable, the triple-A credit rating is under threat and a sense of impotency hangs over the Treasury benches.
Yet the path away from this slough of despond may be less complicated than we imagine. It lies in retracing the party’s steps to reacquaint itself with the Forgotten People, who most certainly do not reside in North Fitzroy or North Sydney. The party must reconnect with its base.
This after all was Menzies’s strategy as he pieced together the coalition that became the Liberal Party in late 1944. The party’s philosophy came not from textbooks or ideological tracts, but from focusing on the concerns of the people the party sought to represent. Its wisdom came not from European intellectuals but from people power, personal aspiration and the wisdom of crowds. The Forgotten People were, in Menzies’s words, “salary-earners, shopkeepers, skilled artisans, professional men and women, farmers and so on”, the people who, in the political and economic sense, could be considered the middle class:
They are for the most part unorganised and unselfconscious. They are envied by those whose benefits are largely obtained by taxing them. They are not rich enough to have individual power. They are taken for granted by each political party in turn. They are not sufficiently lacking in individualism to be organised for what in these days we call “pressure politics”. And yet, as I have said, they are the backbone of the nation.
The Forgotten People expect less from government than governments often seek to provide. They want fewer taxes, less regulation and fewer obstacles to advancing their interests and those of their family. They expect security—physical and economic—reward for effort, choice and opportunity. They are on the whole a conservative lot, probably more socially conservative than the average politician and certainly more conventional than the average journalist, broadcaster or entertainer.
One thing is for certain; the Prime Minister will not win a third term by winning battles in the party room. Far from it; he must keep his enemies close and listen carefully to their advice. The argument the Prime Minister must win is not the one with his conservative colleagues nor the one with those who would encourage him to step decisively to the left. Turnbull’s powers of persuasion must be directed outwards, to Menzies’s Forgotten People, Howard’s Battlers and Tony’s Tradies. The immediate future for the Centre-Right in Australia will be decided by Malcolm’s Middle Class.
Nick Cater is Executive Director of the Menzies Research Centre