In Triumph and Demise, the respected commentator and observer of the Australian polity, Paul Kelly, reflects that serious economic reform is practically impossible today. Written largely before the added intransigence of the Senate became clear, Kelly identified a number of culprits, including the 24-hour news cycle, and an obsession with focus groups.
The modern, democratic polity is characterised by an increasing fragmentation of groups and interests. It is as obvious in other places as it is in Australia. Digital communications and social media amplify these trends.
Complex ideas are reduced to soundbites and a handful of characters. Individuals and groups communicate with like-minded people. A national conversation is more difficult to sustain.
Reform has its challenges. Machiavelli’s observation is true: “There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things. For the initiator has the enmity of all who would profit by the preservation of the old institution and merely lukewarm defenders in those who gain by the new measures.”
Voting systems that emphasize a diversity of interests at the expense of clear electoral outcomes exacerbate the challenge. Inertia is compounded. Necessary change is blocked.
Alexis de Tocqueville, the prescient observer of the new American republic, is reputed to have said that it “would endure until the day Congress discovers that it can bribe the public with the public’s money.”
Sadly, some public figures have exceeded this prediction, borrowing in the name of the public, and then refusing to support measures to redress the situation.
Is Paul Kelly correct? Is economic reform almost impossible
A glance across the Tasman suggests that all is not lost. In a new publication from the Menzies Research Centre, Quiet Achievers, Oliver Hartwich examines the New Zealand path to reform.
Dr Hartwich is the Executive Director of The New Zealand Initiative, a former Research Fellow at the Centre for Independent Studies, and former Chief Economist at the London based Policy Exchange.
Noting the success of the National government of Prime Minister John Key, Hartwich identifies three significant factors: the careful, actuarial based approach to welfare reform and employment; the impressive work of Finance Minister, Bill English – the ‘quiet achiever’ – and an incremental approach to major policy reform. Added to this has been an insistence by the National government to promote the benefits of their policies, not just the features.
Given the Mixed Member Proportional electoral system that operates in New Zealand, and the emphasis on ‘consensus’ amongst Kiwis, the reforms have been significant.
Hartwich suggests a number of lessons for Australia, summarised by the words patience, preparation, pragmatism and principle. Importantly, inquiry, debate, consultation and compromise are critical characteristics of this success.
This relatively short essay is recommended reading for Australian policy makers.
Oliver Hartwich (2014) Quiet Achievers: The New Zealand Path to Reform [Ballarat, Connor Court]