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More than a couple of decades ago the Rat found abode in a glorious sandstone dwelling complete with wrap around verandahs just 3 miles out of the centre of Perth, Australia, nestled on the conjunction of the Swan and Canning Rivers. It had a septic tank dunny and shower out the back, what used to be a lawn converted into a vegetable garden, and a wood stove.
Conveniently, Rowley's Tavern was directly opposite the back door, and the stately old Raffles hotel, owned by well known crim Abe Saffron, was 2 minutes walk from the front door. It was one of those ubiquitous student houses, where you split up the rent weekly divided by the number of rooms. This place being so expansive, it provided a bed for around a dozen assorted students, world traveller backpackers resting up for a few months before hitting the Silk Road back to Asia again, starving rock musicians, pot smokers, surfers, barmaids, ...and quite a few anarchists. Perhaps the most colorful of the latter was "Red" Bingham, a big red haired Irishman, and to those who knew him, a man with a heart of gold. To those at local varsities where he used to pick up a bunch of sticks and theatrically attempt to break them to demonstrate the "unity is strength" message, he was a well known international socialist orator. He had a prediliction for jumping on top of the communal wooden dinner table, still full of the remains of our rice, baked lentils, curried vegetables, and cheap flagon red wine to lead a full voiced reprise of "L'internationale" - "...the workers flag is brightest red..." etc. etc. Like all the over 50 unique characters that spent at least part of their lives at "Kishorn Road" in the three years I stayed there, one minute he was there, and the next he was gone, leaving only fond memories. Only two years later I read a report that Red had just been charged with assaulting a young up and coming member of the "Young Liberals" at the Monash University campus in Melbourne - this following on his ejection from campus grounds for assaulting a group of surveying students setting up their instruments on an access road, mistaking them for police setting up a radar trap. That up and coming member of the Young Liberals 20 years ago was Peter Costello, then an unknown, and now the Australian Treasurer and at least until last week, the man most widely tipped to succeed present Australian Prime Minister John Howard. Last week saw Peter Costello cop his second bashing, but this time it was not at the hands of a spirited Irish anarchist who had drunk too much flagon wine, but from the echelons of power within the scion of middle class, conservative Australia - his own Liberal Party. A leaked memo from the Liberal Party president to Howard, criticised the government for being "...out of touch, mean and tricky...", but reserved its most scathing criticism for Costello. An angry and embarrassed Costello demanded an explantion for the memo, to be rewarded only by Howard saying that "...he fully supported Stone and was willing to accept the criticism...". According to Reuters, "...Howard and Costello held separate news conferences 15 minutes apart to respond to the leak of a scathing internal memo, fuelling rumours of split...". The broad picture however is less titillating, but more important. Like many small to mid sized developing and developed nation states in the Asia Pacific and world wide, incumbent governments face the almost irreconciliable difficulty of both opening up to take advantage of the potential of globalization, and appeasing a local middle to working class seeing their growth in earning power decline, as they are forced to compete not against workers in their own patch but also from other countries which may have competitive advantages. The knee jerk reaction is to blame the national government, yet the power of the nation state to determine their own future is being undermined in the face of the opening up of global competition. Free market and liberal economists heap praise upon those governments who recognize that globalization is inevitable and adjust their strategies accordingly. Yet like-minded free market inspired governments like Australia are finding their very existance threatened by a conservative and pampered electorate grown used to the national government sorting out their problems. A couple of decades of good performance by developed economies has seen the decrease of grass roots movements, union participation, and a continuing selfish streak in those who have gained the most. Things are turning around. Workers in developed and rich countries now demonstrate against global enities rather than national governments beacuse their incomes are being threatened by workers from poor countries how can produce the same product more cheaply. Governments in poorer counries complain their workers are being exploited. The Howard-led Liberal Party, and Peter Costello in particular remain true blue to their philosphical fellow travellers - the broad middle class and all sizes of business - (The Australian Liberal Party, contrary to their name is actually the major conservative party in Australia, similar to the Republicans in the US and the Conservatives in the UK, to use Western democracies for comparison. The only parties to the right of the Australian Liberals are small one issue or extremist groups). The problem is that in Australia's bicameral political system (The Australian Labour Party representing the left to the middle and the Liberal Party representing the right to the middle), the swinging voters are the ones who voted the Liberals in. And those swinging voters are the ones most adversely affected by the government's free market policies. The result is continued bouquets from international economist circles and independent observers for a long term vision, but continuing desertion by voters whose main concern is the hip pocket pain in the present. Polls and latest provincial election results suggest these voters are swinging back to the Labour party which is seen as more compassionate, protectionist, and protective of fixed income earners, or to the more extreme Pauline Hanson-led One Nation Party which appeals to ultra conservative and rural voters who look for simple answers and scapegoats. The Liberal party has suffered major set backs due to these factors in elections in Western Australia and Queensland, and polls show a decline in popularity for the givernment and Howard, though there seemed to be some turn around recently. But the internal splits which are only becoming more apparant now are nothing more than a reflection of the difficulty of moving to a new model of global economics while keeping those who vote you in happy. Traditionally, the role of the President of the Liberal Party is a pragmatic one, - to keep the party in power now, and is naturally often in conflict with the many economic purists who represent the party in parliament. The political prognosis in Australia is not good. The style of an Australian Labour Party in government voted in in the present circumstances may not be similar to the progressive, outward looking, and pluralistic style of the ALP golden years of the Hawke and Keating, or even Whitlam administrations. It may well be more reminiscent of Labour's protectionist and trade union dominated origins. We may be wrong, but the ALP pragmatically must make a spin to those who blame globalization and the free market. One Nation, due to the two party system, cannot form a government in their own right of course, but they could wield power in the Senate on the back of the rural and reactinary vote. The one bright light on the horizon could be the revitalization of the Australian Democrats as an alternative to both the two major partices and One Nation, considerably reducing the significance of the One Nation constituency of reactionaries. The greatest threat however, is to Australia's rickety path to engagement with Asia. We were ambivalent in this column, on the election of the Liberal Party over the ALP many years ago, on the effects of the change of government on Asia policy. Some good progress has been made, especially with relations with China, and maybe even Singapore, while Indonesia, Australia's closest Asian neighbour and friend, has been a policy mess. Much of the good was just competent follow through from the pro-Asian integration stance of Hawke and Keating, but we have seen less proactivity than is necessary at a time when Australia needed desparately to rid themselves of the Tyranny of Distance. The current issues are local and internal; there is little party-political mileage in rattling the Asian engagement can, - about as much as rattling the globalization can. A possible Costello split, himself being the flag bearer within the government of free market reform and internationalism, is simply a reflection of the wide divide between the theorists and the pragmatists. And as always for the political animal, self-preservation is instinctive. He has taken bashings before. Some how we think this one delivered in a more well mannered way from his own side of the political divide, may be far more painful...
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© Asian Business Strategy & Street Intelligence Ezine 2001
The views expressed here may not necessarily reflect those of partners, publishers, editorial board nor sponsors of the Asia Pacific Management Forum
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