It’s very early days, but the Rudd Government seems determined to follow the path the Hawke administration stumbled onto and be realistic economic reformers.
A global credit crunch could scuttle their plans. So could an outbreak of old-Laborism from the union hacks that make up most of their Senate team. Still, Rudd and his Treasurer Wayne Swan made fiscal responsibility central to their election campaign.
That was the easy part. “We campaign in poetry, but we govern in prose,” the saying goes. There was precious little poetry in the Rudd campaign, and now Swan is finding it very, very hard to find the right words for governing at a time of interest rate stress.
Labor has embraced Treasury; very, very tightly indeed. No doubt it has help with economic cred – and provides the government with a handy whipping boy if things go terribly wrong.
Treasury has traditionally been the most powerful department. They were so powerful that Malcolm Fraser split them in two in 1976, created the Department of Finance. But Treasury can’t help with everything. They can help on the politics, but they can’t give you the final words.
Swan seems to have been lost for words over the past few days as he has tried to talk tough on rate rises.
Lines like “I’m not describing the ANZ as greedy. They’re a private sector organisation that acts in their own commercial interests” are obviously designed not to be anti-business, but they sound both clumsy and weak. That’s a very poor look for a treasurer.
When Fraser split Treasury, Finance gained responsibility for the review of expenditure and preparation of budget estimates.
At this stage of political cycle – and with plenty of fat to hack into – that’s the easy task.
Finance Minister Lindsay Tanner is hard at work. Crikey understands that he is as happy as a pig in mud, that he feels he finally has a job.
Tanner has always been one of the more purposeful Labor feds. He entertained leadership ambitions several years ago, but realised his own limitations. He has been a subtle but significant participant in philosophical debates. He has no hang-ups about wielding the knife. He knows that spending responsibly is the first step towards delivering social democracy.
The contrast between Swan and Tanner at the moment is stark.
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