Gillard leans to the Left

Julia Gillard playing billiards in Brisbane last weekend. Picture: Gary Ramage

JULIA Gillard has shown her mettle during this campaign, retaining her composure, staying on message, braving internal upheavals.

More significant are the signs of a new feminine philosophy of politics that may stamp Australia's future.

Gillard may be as tough as Margaret Thatcher but her beliefs are far distant from the Iron Lady. Gillard is formidable because her personality radiates two qualities: she is competent and she is compassionate. But it goes beyond this.

Gillard, following Rudd's agenda, is taking Australia decisively to the Left with ideas she markets as fairness, sustainability, enlightened government intervention and a hi-tech command of the future. Presented with a feminine stamp Gillard holds out the prospect of giving the pragmatic Left the most success and respectability it has enjoyed in this country for many decades. This may prove to be the ultimate meaning of election 2010.

Gillard may become the ideal Labor leader for the times. If she prevails Gillard will vanquish Tony Abbott's assault from the Right, drawing on female voters, the trade union movement and a preference deal with the Greens. The strength of her position, anchored in this shift to the Left, could be impressive. She would govern, of course, with the Greens holding the balance of power in the Senate, yet her ability as a negotiator suggests she may not be hostage to them.

For decades the iron law among Labor's right-wing powerbrokers was that a Labor PM had to be a right-winger to succeed; witness Gough Whitlam, Bob Hawke and Paul Keating. But Labor no longer thinks like this. Gillard mocks such rules.

She opens up new opportunities for the Left while simultaneously redefining left politics.

Gillard won the second last week of the campaign. Her positive messages are as strong as her negative attack on Abbott is relentless. The Coalition campaign is far too static and it shows.

What are the big messages that Gillard has repeatedly sent in her campaign?

First, that she will end immigration solely dictated by the labour market by adding the new concept of sustainability. She pledges to give Australia its first sustainability policy, suggesting a turning point has arrived after more than 60 years of immigration. Gillard presents this as saving "the Australian quality of life", a fusion of environmentalism with cultural nostalgia.

Her voter pitch is blatant: "Can we really ask western Sydney to keep absorbing hundreds and hundreds of thousands of people without regard to the key issue of quality of life?" she asked yesterday. Yes, this is also Abbott's pitch. But Gillard's embrace of the vague yet meaningful sustainability position fits into the feminisation of politics that she embodies.

Second, she argues that Labor saved Australia from recession by its big spending, that any waste was an unfortunate by-product and that she would do it all again. This is a frontal assault on Abbott's campaign against waste and debt.

Gillard plays down the alternative, more accurate argument -- Australia was saved because of its reform-branded strategic game plan -- because it had few sub-prime loans, no domestic banking crisis, no public debt, because its central bank slashed interest rates, because of momentum from population growth, because of its integration with China and also because of its fiscal stimulus, though reports from Brad Orgill and the Auditor-General suggest much of this stimulus was spent after the recession threat had passed.

Labor deserves credit for saving Australia from recession but the Prime Minister chooses to attribute this to its big spending, not the wider reform story. It is a defining insight that reveals Labor's values.

Third, Gillard has turned old-fashioned nation building into the political future. Rudd used climate change in 2007 to seize the "future" position against John Howard. Gillard uses infrastructure spearheaded by the National Broadband Network. It combines Labor's nostalgia for Snowy Mountains-type government investment with its claim of superior hi-tech credentials.

Gillard mocked Abbott for taking Australia back to the "digital dark ages", having a slower internet and mucking about with market-based competition. She is correct in finding the Coalition policy unconvincing. Yet Labor operates on the principle of "government knows best". It backs one technology: fibre to the home. It offers no choice. It has no business plan. It refuses to be restrained by costs. At the same time Gillard offered western Sydney the Epping-Parramatta rail link, a straight $2.6 billion lift from the infrastructure pork barrel. Abbott refused to match it, provoking Gillard's onslaught.

Yet the pledge is proof Labor doesn't get infrastructure.

Infrastructure is tough, not easy politics. It should be seen as an economic reform that demands cost-benefit analysis of projects, the user-pays principle, market pricing, not the free ride. In his recent report commissioned by the Business Council, economist Rod Sims called for a cultural change in the way Australia does infrastructure. There is, however, little sign of such change from Labor.

Gillard, like Rudd, presents as a believer in economic growth and reform. Yet the Rudd-Gillard productivity agenda is a modern Labor creation often in conflict with the pro-market agenda advocated by the Productivity Commission. The Rudd-Gillard agenda is driven by pervasive government intervention: industry special deals, government-gifted infrastructure projects, mandated renewable energy targets and a series of plain wacky green schemes. Labor gets it half right. The problem in its better productivity quest is that it resurrects the state paternalism that has been Australia's historical curse and the origin of its previous poor global performance.

Productivity Commission chairman Gary Banks has issued plenty of warnings since Labor came to power: that industry assistance totals $17bn and could be removed mostly with a net economic gain; that infrastructure spending "cannot be a panacea" for productivity or creating jobs; that governments are foolish to "promote any particular industry or sector as an end in itself".

Fourth, Gillard enshrines fairness at the heart of her political character. This is apparent in her stoic commitment to tackling disadvantage in education.

Its most illustrious example, however, is her dismantling of Work Choices for her Fair Work Act. She repeated yesterday that getting her bill approved with its abolition of workplace agreements was "one of the proudest days of my life".

This partial re-regulation of the labour market is usually seen as a restoration of union power though a better description may be the attempt to feminise the workplace, with its new rules and central umpire sanctioned in the name of fairness but sure to weaken productivity and job creation.

Finally, Gillard Labor presents as the superior party on service delivery, notably health and education. This is a mix of traditional Labor strength with a touch of the modern such as GP super clinics, e-health, green jobs and superior investment in education and training. Labor's negative campaign against Abbott on services must be having an impact.

On education, Gillard has been creative and rewrites the rule book of left politics. Here she is more market-based. She takes a stand on behalf of the clients (students and parents) and wants to shake up the producers (teachers and state bureaucracies). She has confronted the teacher unions and won, a landmark event in the politics of the Left. She backs an education system with more transparency, better evaluation and accountability.

The mistake her critics make is to assume that Gillard, along with Treasurer Wayne Swan, is fiscally irresponsible. The evidence points the other way. The test on this score is not the fiscal stimulus; it is Labor's commitment to return to surplus. The government has brought forward this surplus pledge to three years hence. It has in place the fiscal rules to achieve it, contrary to Coalition claims. Modern Labor, both Left and Right, accepts the principle of the surplus budget.

The Cold War policy divisions between Labor's Left and Right belong to a bygone age. But Gillard does have a special significance as a female Prime Minister with her originating base in the party's Left. She is drawing on that heritage.

If Labor wins and there is also a strong Green vote that will testify to a structural shift to the Left in Australian politics. It will install Gillard as the new interpreter of that movement and she is bound to deliver some surprises.