Down Under and November: Why Australia Has Democrats Worried

by Arif Panju

Pay just a bit of attention to what has been going on in Australian politics the past few months and you will quickly get the sense you are reading a U.S. 2010 midterm preview.  President Obama and congressional Democrats will not find solace in the many parallels between the current political climate in the United States and that unfolding Down Under.  The tides have turned in Oz and its waves are set to hit U.S. shores on November 2nd.

Batter Up.

Batter Up.

The huge swing away from the liberal Labor Party’s agenda has left Australia in the center of the Federal political spectrum, as the major parties worked towards resolving the nation’s second hung parliament in its Federal history.  The deadlock ended this week.  This occurrence marks a new era for federal politics in Australia―with the formation of a new government hinging on three independents, two of which finally cut a deal with Labor to give them the 76 seats needed to form a minority government, barely fending off the conservative coalition’s 74.

One thing is certain, although the Labor Party swept in 2007 (with a twenty-three seat swing from 60 to 83), Labor has managed to lose the confidence of a majority of Australians in the space of less than a year.  The architects of the policy failures which brought this about through their cynicism and self-importance have received a stern message: Aussies are not interested in more government.

The parallels between the U.S. and Australian political landscapes are eye-opening.

Kevin Rudd, who was still Prime Minister when President Obama cancelled (for a second time) his trip to Australia this past June (citing the BP oil spill), has fallen from grace.  The former prime minister who could do nothing wrong could now do nothing right.  His approval rating sunk to 36% (from 67% just 9 months prior).  Over the same time period, President Obama has also seen his numbers sink, with a recent approval rating of 45% (down from 65% in January).

The left in both countries have promoted large social programs that are unpopular.  After shelving his hallmark cap-and-trade plan in the face of mounting opposition from Australian voters, Rudd was ultimately ousted from the PM post by his own deputy, Julia Gillard, just weeks before the August 21st general election.  The liberal powers that be did not agree they should abandon their drive to cap and tax the entire Australian energy economy.  Arrogance is contagious.

Having secured a razor-thin edge in Parliament, Labor—blinded by their belief they know what is best― will indeed try again.  Here, in the U.S., the ObamaCare writing is on the wall and the number of Democrats running on their marquee legislative accomplishment is close to none.  While Rudd stepped off the accelerator, Obama and Co. hit the nitrous switch and drove healthcare reform straight through all opposition, including the American voter.

The left’s approach to the challenging economy in both countries also underscores the erosion in support.  Like the Obama Administration, Labor chose deficit spending, quickly eliminating the surplus left behind by former conservative Prime Minister John Howard.  When Obama and congressional Democrats targeted credit card companies, Labor did the same, leading to reduced consumer credit during difficult economic times.

When Labor was not pushing spending, they pushed new taxes.  In 2008 both congressional Democrats and then candidate Obama touted new taxes on oil companies’ “windfall profits.”  Not to be outdone, Labor in Australia pushed a 40% “Super Profits Tax” on mining companies.  The left were once again relentless in their pursuit, yet missed the mark by ignoring the effects of their policy: higher energy costs and reducing the competitive strength of its producers.

But there is more.  Even after Gillard replaced Rudd, she was quick to grip the baton and, like the Obama Administration, unveiled a cash for clunkers program for Australians.  Primarily determined to get 200,000 cars off of the road, Gillard noted the vehicles “guzzle a lot of petrol and they spew out a lot of pollution.”  Like Obama and Democrats here in the U.S., Labor Party proponents miss a simple economic fact.  Their policy ignores the hidden costs associated with destroying the economic value remaining in inexpensive, road-worthy vehicles that can transport workers and young people to work and school.

Similar to the movement in the U.S. against runaway spending and an ever expanding government, Australians began rallying around the conservatives and opposition leader Tony Abbott.  Abbott led the conservatives and opposed Labor’s big government policies, launching an offensive targeting the government’s attempt to grow debt and deficits instead of cutting spending and lowering taxes.

Although Abbott fell short of becoming Australia’s new Prime Minister this week, he has been effective. Only a few weeks ago, political experts were predicting a landslide for the incumbent Gillard. But as her campaign reached its final stages in August, the conservative coalition’s economic stance—including opposing the proposed tax on the mining sector and letting private industry install a broadband network in the country—resonated with Australian voters a lot more than Gillard.

The pattern of big government is one that subsidizes problems with taxpayer money, taxing with one hand and simultaneously swiping the country’s credit card with the other.  This pattern quickly lost traction in the U.K (who chose conservative David Cameron) and Australia (who marginalized Labor by strengthening conservatives).

The U.S. voter is on deck.  Democrats should be concerned.  Less than one-year ago, the results of the recent U.K. and Australian elections would have seemed improbable.  The pattern is difficult to ignore.  Voters in both countries have chosen capitalism and limited government over the left’s social engineering and big spending.  Batter up, the world knows Americans like to hit it out of the park.


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Posted Sep 8th 2010 at 8:40 am in Congress, Midterm Elections, News, Politics | 65 Comments