Forward Pragmatically

Battlelines, by Tony Abbott, Melbourne University Press, 2009, $34.99.

Tony Abbott opens his book with a prologue putting the case that Liberals should write more books. Authorship is a risky undertaking for any politician. Public humiliation is part and parcel of political life, and finding one’s opus in the Angus & Robertson two-dollar bin must prick even the toughest of hides, but by all accounts this book is selling well and is unlikely to be remaindered.

The guts of the book start with Abbott’s thoughts on liberalism and conservatism. The Liberal Party began as a fusion of the liberal and conservative parties of the day to be a bulwark against the success of politically organised labour. It defined itself not by what it was but by what it was not. This division between liberal and conservative today manifests itself in debates on the republic, the family, life issues and immigration policy.

Such frictions are also prevalent in Labor. But the strength of our two-party system is that both parties’ survival depends on a willingness to compromise and accommodate a range of views. Whenever either party has engaged on a quest for ideological purity, the price has been electoral failure. Abbott’s purpose is to resist such tendencies and provide a common way forward for the liberal and conservative wings of his party. The path he offers is pragmatism.

Abbott is wise to position himself as a pragmatist. But in doing so he lays himself open to Noel Pearson’s criticism:

Liberal-conservatives are still big believers in government. They think overwhelmingly that it is government that needs to be the main actor … they see it largely as a matter of state service delivery rather than what we have come to call in Cape York Peninsula supported self-help.

In the three main policy areas he deals with—health, support for families and federal–state relations—Abbott seldom suggests government may be the problem instead of the solution. At best, his solutions rest on transferring increasing responsibility to the Commonwealth, at worst he advocates adding more layers of government involvement.

I would have thought that a leading intellectual of the Liberal Party might have more to say about the way government encroaches on almost every aspect of modern life. Or that he might have picked up Tony Blair’s theme that government can’t right every wrong every time the cry goes out for further government action. Abbott has not thought sufficiently about the impact an ever-expanding public sector has on civic institutions and public virtues like living with the consequences of one’s actions, prudence and self-reliance.

Abbott limits his discussion to service delivery and his frustration that reforms that the Howard government could have made were blocked by the recalcitrance of the states.

He nominates local management for hospitals as an important reform he would like to have seen. But state health budgets are growing at a rate where they will consume entire state budgets in the next few decades. Two factors drive this: the ageing of the population and the expectation of free access to hospital health care. As any undergraduate economics student will tell you, if you have unlimited demand and limited resources to fulfil that demand, something has to give.

These are big problems. Whether the Commonwealth or the states run our hospital system, answers will be needed to questions about what levels of care are provided, to whom, and at what cost.

Abbott makes a good case that means testing of family benefits creates disincentives and unfairly disadvantages some families, especially those where one spouse remains out of the paid workforce. However, his proposal for universal payments sits uncomfortably with me. I am not satisfied that the inefficiencies of churn are less than the benefits Abbott expects from such a policy. It is better to identify the disincentives—such as high rates of marginal tax—and remove them.

Again, in Commonwealth–state relations Abbott puts the problems all down to management. He has faith in the Commonwealth’s ability to deliver services better than the states. A cursory look at the Department of Defence suggests that all levels of government are prone to mismanagement, particularly when very large budgets are involved.

The problems Abbott identifies with the states are caused by the disjuncture between taxing and service delivery. A system where the states deliver the services paid for by revenue raised by the Commonwealth is bound to be inefficient. This is what causes the blurred lines of responsibility of which Abbott is so critical.

There is a public policy trade-off between the amount of services the public expect to be delivered and how much they are prepared to be taxed to pay for those services. Ideally, political parties go to the electorate with competing policies balancing the two. This doesn’t happen in our system because states undertake most of the service delivery but have almost no say in the amount their citizens are taxed. There is little incentive for state governments to bear the political hardship of efficiency drives when there is no political reward for lower taxes that could result. State governments wanting to undertake large spending programs or faced with fiscal challenges like health have no alternative but to go cap in hand to Canberra.

Abbott’s proposed constitutional change betrays an approach to policy making more concerned with treating the symptoms than the disease. It would mean less rather than more political responsibility for the states. It is self-evident that the Commonwealth should take on responsibility for areas it can manage more efficiently, even in the traditional domains of the states, but I do not think that the profound problems we face, particularly in providing health care at levels the public have come to expect, will be solved by such a transfer.

Abbott is one of the few members of his party interested in welfare reform. He has greater sympathy for the poor than many of his opponents and he understands the debilitating effect of welfare dependency. From his earliest days as employment minister he has driven debate inside his party about how to give a hand up to the most vulnerable, particularly those wanting to make the transition from welfare to work.

He draws on the ideas of thinkers from across the political divide like Frank Field, Noel Pearson and Warren Mundine. He advocates the quarantine of payments for those with children, mutual obligation principles and removing the disincentives to people moving from welfare to work.

It is a pity that welfare reform is a relatively small part of his book for it is in this area that Abbott has the most to offer.

Anyone who knows Abbott knows that his enthusiasm for those he admires is boundless. Sometimes he runs the risk of over-egging the pudding. The chapter on the Howard government may have been more effective if it was more frank about that government’s limitations.

When writing about the Labor Party, Abbott lapses into rhetoric: “Labor’s instinct [is] for big government and more spending”; “The idea that the world owes people a living is strong inside the Labor Party”. He should resist blanket denunciations. Nevertheless, Abbott’s style is readable and he interweaves the drier discussions of policy and political philosophy with personal experience.

For all his skill at getting the attention of the public, Abbott is underrated as a politician. He has never got the credit he deserves for pretty much singlehandedly seeing off the One Nation menace. He is too easily caricatured, partly through his own fault. But this book, whatever my reservations about its conclusions, shows Abbott will be pivotal to the future success of the Liberal Party.

Jack Snelling has been a Labor MP in South Australia since 1997. He is Speaker of the South Australian House of Assembly.