Oldest party cracked at foundation

THE essential factor in NSW Labor's debacle is that the party's leadership, structure and culture has failed the task of governing a contemporary society long distant from the world of the 1890s when Labor was called into existence.

Claims that NSW Labor's setback is cyclical and the party is certain to bounce back betray a complacency and inability to confront the scale of the crisis. If this defeat cannot shake Labor into serious re-assessment what hope is there?

The first point to make is there is no outstanding figure to lead NSW Labor. The gulf between the task and the talent is just embarrassing. There is no Neville Wran. There is no Bill McKell. There is no figure that remotely matches Bob Carr.

The caucus survivors may be good and true. But the assumed elevation to the leadership of John Robertson, candidate of the ALP machine, inspires no confidence. The spin is that Robertson can re-connect to Labor's base and maybe this is true. But he projects as the type of union boss Labor discarded from the leader's slot several decades ago. This move seems a step into the past.

Former minister Frank Sartor told the ABC's Lateline the "fix has been on" for Robertson for months. "I think this is a really bad sign," Sartor said, surely an under-statement.

Remember, in 2008 Robertson spearheaded the political attack on former premier Morris Iemma. In 2001 he led the union blockade of the NSW parliament against Carr's Work Cover reforms. Paul Keating, the most illustrious son of the NSW Right, said three years ago that Labor had "no future" under Robertson.

Are you starting to think that recovery for NSW Labor won't be easy ?

The real issue raised by this debacle has not even been enunciated. It is whether the Labor Party's structure and culture is consistent with competent government at this point in Australia's history.

NSW Labor has failed this test. Julia Gillard is now desperately trying to prove that Labor can be a viable national government after the Rudd implosion.

At this election Labor lost the pragmatic middle ground along with its heartland, notably men between 30 and 50 years old according to its own research (this can probably be extended to men between 30 and 65 years). These are the workers for whom the Labor Party was first created.

The frequent accusation during the past decade is that Labor has betrayed its base and the NSW result proves this point. For many workers voting Labor is no longer a natural thing to do. This is a universal Labor problem that merely reached its zenith in NSW.

Former Labor leader Mark Latham, a product of the NSW party, said in 2005 that Labor's "massive cultural and structural problems are insoluble" and that its machine politics had created a crisis of both process and belief.

What does this mean? The most plausible interpretation is that after the Hawke-Keating reform era Labor's institutional identity took a decisive turn. Fashioned at state government level Labor became a party of government that relied on a slick figurehead (witness Carr, Mike Rann, Peter Beattie) and a new political class of professional politicians, staffers, advisers, factional operatives, trade union organisers and wider networks based on family, tribe and interests.

Former NSW minister Rodney Cavalier said: "The political class has captured Labor in parliament and in the machine."

The initial result seemed brilliant. Labor's professionalism slayed the non-Labor side in election after election in state after state. Yet the emerging cultural change was decisive.

Labor's real purpose became to govern, to control power, to dispense patronage and to champion interests, not to promote a reform agenda or ideology. With the termination of the Hawke-Keating ethos there was no new reform framework. Labor became a party of the status quo and policy caution with an eye for poll-driven initiatives starting with a pro-green shopping list.

The proof of this malaise came from 2008 onwards. The Rudd government's stunning failure was its climate change policy retreat. The NSW Labor government's even more stunning failure was its botched electricity privatisation. These failures, different in origin, are united as symptoms of Labor's advancing political malaise.

Rudd's climate change evacuation was the ultimate in a crisis of belief. NSW Labor's electricity retreat was the ultimate in machine hubris as the party declared war on the Iemma government and then assassinated its premier.

In one sense the entire meaning of the Gillard prime ministership, conceived in the convulsions of such Labor malaise, is to try to break free from its factionalism, machine excesses and lack of policy conviction by projecting as a leader of strength and purpose. If Gillard fails, the affliction will spread and deepen.

The structural crisis is most apparent at state level. Labor remains the political wing of the union movement.

The unions constitute 50 per cent of delegates at ALP policy-binding state conferences yet the unions are unrepresentative of private sector workers given the growth of small business contractors and tradesmen.

For Labor, at all levels, there is a conflict between party structure and public policy. To the extent it privileges unions, it hurts other workers and this is a potent issue today.

Yet to the extent Labor runs an agenda of productivity raising economic reform, it hurts trade union interests and risks internal revolt. The Labor Party is partly paralysed by this conundrum.

The cathartic moment at the 2008 NSW conference came on the 702-107 vote for Robertson's amendment dictating to the Iemma government against the privatisation policy. The message was obvious: Labor had to submit the public interest to the party interest when a fundamental conflict arose. Once this declaration was made, Labor forfeited its right to govern NSW.

Such a deadly conflict, obviously, will not occur at the national level. Yet the fault lines it represents are ever-present in both state and national politics and manifested in chronic community suspicion that Labor governs for its own supporter networks and poll-driven voting interests as distinct from the broader public interest.

This is another way of saying that Labor's real contemporary problem, evident in NSW in extreme form, is whether the party has the political courage, internal discipline and reformist ideas to govern successfully at this point of history. Ultimately, it is as big and as simple as that.

For most of Labor's history NSW has been its foundation and anybody who thinks a cracked foundation won't affect the whole edifice isn't thinking rationally.