In considering how the federal election count has progressed, it’s hard to get away from thinking about the opening scene of The Hangover, in which Zach Galifianakis starts his day oblivious to what happened the previous night. He stumbles, bleary-eyed but happy, across the hotel room, almost tripping over a duck, before entering the bathroom where he slowly realises he managed to bring home a Sumatran Tiger. And it’s in the room, growling at him.
Clearly, something big has gone down. Time to try and piece it all together.
What made this election different was the clear arrival of a global trend to Australian shores.
The nation can now count itself among the increasing number of advanced democracies worldwide where anger and cynicism about mainstream parties is crystallising into decisions at the ballot box and reshaping western politics.
The primary vote for independents, at more than 23%, is at another record high. The Senate is looking like a disorderly nightmare for whoever ends up managing to forge a working majority in the House of Representatives.
This phenomenon is sweeping the world and it is – or at least, should be – forcing some major rethinking of what it takes to earn and wield political power in the modern age.
The old post-election quip that “the people have spoken; it’s just not clear what they’ve said” is apt when it comes to the House of Representatives. Turnbull said today he was “quietly confident” of securing a working majority, but it may take more than a week to determine the final result of the vote.
But there was an underlying and unmistakable message to the established political order: you are all warned.
While Labor will no doubt be upbeat about the outcome which defied the consensus that Malcolm Turnbull and the Coalition would be returned with a reduced majority, its primary vote was the second-lowest in history, continuing a long-term trend in declining support for the party.
This chart, produced by ABC News, shows the 2016’s federal election primary vote in its astonishing historical context.
For the next three years – if the Parliament survives that long – MPs who stand over anything less than a thumping personal vote in their electorates and neglect their local patches are in mortal danger. This is evidenced in the dramatic swings against incumbents we’ve seen in divisions around the country.
For the government, seats were falling everywhere. In the southern NSW seat of Eden Monaro, Peter Hendy was turfed out and Coalition recriminations were swift: he stayed in the Canberra bar, didn’t watch his seat.
To the north, in the Queensland seat of Longman, Wyatt Roy suffered a swing of more than 8% against him despite having built and maintained a high national profile as the country’s youngest MP.
In South Australia, Jamie Briggs, the former John Howard staffer and minister who fell from grace after an incident with a public servant in a Hong Kong bar, was ousted by his own former employee Rebekha Sharkie, the candidate for the independent Nick Xenophon Team, which is looking like securing three seats in the Senate.
In the Northern Territory, one part of the country which has been hardest hurt by the downturn in the resources sector, the Coalition’s Natasha Griggs saw a monster swing against her of 8% as Labor’s Luke Gosling picked up the seat.
And in Tasmania, Andrew Nikolic was wiped out by a swing of more than 10% against him to Labor’s Ross Hart.
Labor also managed to secure strong swings in some critical swing seats around Sydney like Macarthur and Barton.
There was no unifying theme to the losses. Shorten’s campaign on Medicare hurt the Coalition, but some were because of sloppy local campaigns. Hendy was lazy. Briggs was the victim of a judgement on his character and the populism of the NXT. Nikolic fell victim to the historic volatility of Bass. The net result has been the wipeout of the majority secured by Tony Abbott in 2013.
The news is not all good for Labor, either. Perhaps the most intriguing spur of the story for Labor was in Victoria, where the union movement’s attempt to take control of the volunteer firefighters, the CFA, was one of the most prevalent themes of the campaign. Here, in opposition leader Bill Shorten’s home state, was where the swing was smallest against the government at just 1.5%.
The unions ran a hard ground game around the country on behalf of the Labor party, whipping up Bill Shorten’s message to voters that Medicare was under threat from a Coalition government despite the absence of any policy that suggested cutbacks and Turnbull’s repeated insistence.
A Coalition source conceded that the unions “worked their arses off” through the campaign, suggesting it was because they were “shit scared of the return of the ABCC”, the construction industry watchdog.
In a final squalid move, voters on polling day were receiving text messages with the sender marked as “Medicare”, urging a vote against the Coalition:
Turnbull said last night that he expected the police to investigate. We’ll see where that ends up. But the Labor movement would be unwise to ignore a possible link between union influence and its results in Victoria. Union membership continues to shrink across the Australian workforce, and with it now plumbing depths of only 15% of workers it is risking becoming a fringe movement for the general public while remaining central to the ALP’s politics, policy, and power dynamics.
The Coalition, too, is seeing its primary vote haemorrhaging over time. For Turnbull, meanwhile, this result can only be seen as a failure to deliver what he promised: stability and confidence. We are in for years – again, assuming the Parliament survives – of more instability and policy uncertainty. Australia’s transitioning economy, with little prospect of reform, looks as if it will have to continue to muddle through without much-needed reform, and we’re likely to see continuing budget deficits as the government wrestles with the Senate zoo.
Shane Oliver, chief economist at investment giant AMP capital noted this morning:
The prospect of another three years of de facto minority government coming on the back of the minority Gillard/Rudd government over 2010-13 and the 2013-16 Coalition government’s inability to pass much of its economic and budget reform agenda through the Senate is not a good outcome for the Australian economy. Whoever wins it means that the risk of a sovereign credit rating downgrade has increased further.
Is that all? No:
More broadly, the success of Labor campaign offering more spending and higher taxes coming on the back of the Brexit outcome in the UK and the success of Trump and Sanders in the US adds to evidence that median voters are shifting to the left and away from the economic rationalist policies of deregulation, smaller government and globalisation. This is a negative for long term growth prospects and an additional constraint on investment returns.
It is easy to reach for explanations in local political factors, like South Australia’s high rate of unemployment or Queensland’s disillusionment with state politics, as reasons for the results we have seen in this election. But it is perilous to discount the theory that this is part of the global phenomenon of people thumbing their noses at political elites and established parties.
‘Something wicked this way comes’
On a seat-by-seat level the simpler, more local explanations for what has just happened in Australia may be right. But look at the Senate votes, the surge in independent support, and in the 3%-plus swing to informal voting for the upper house. There is no denying that it looks part of a global pattern. In Haaretz last week, under a piece ominously titled “Trump, Brexit, ISIS and the Unmistakable Stench of the 1930s“, Chemi Shalev noted:
Take the dread that quickly replaced the shock that most people in the West felt in reaction to Britain’s decision to leave the European Union. The results undoubtedly came as a big surprise, but that can be ascribed to the complacency and detachment of British elites, opinion-makers and opinion-analyzers, a topic that has been thoroughly dissected in the short days that have passed since the shock outcome was announced. What is harder to shake, however, is a sinking sense that Brexit isn’t just an isolated phenomenon but one in a series of unfortunate events that should prick our thumbs, as the second witch says to Macbeth’s approach, to warn us that “something wicked this way comes.”
Britain’s referendum on the European Union has stunned the world and triggered enormous uncertainty over the future of Europe. Trump’s rise in the US has been breathtaking, and while he is performing poorly in the national polls against Hillary Clinton, recent history is a warning about the misleading signals that published polling can send. Ireland has just been through an election after which it took 70 days – 70 days! – to form a minority government because there was no clear winner. There, too, the voting public turned in a surge of support for independents and minor parties.
Around the world in the wake of the GFC, we are seeing common economic challenges: populations are ageing, transforming the political equation. Bond yields are plunging into ultra-low or even negative territory as central bankers try to encourage much-needed investment and job creation. This has driven a surge in asset price inflation, reflected in booming property markets in places like London and Sydney, putting first homes out of reach for young people who are already staring at a lifetime of paying taxes to governments to help repay the enormous levels of public debt that have been amassed. And wages growth has been stagnant – in Australia falling to record lows – making it harder for people to feel like they’re getting ahead.
The classic approach to tackling some of these globally-induced economic problems is through policy reform: improvements to the taxation system, industrial relations advances, better incentives for allocation of high-impact capital investment that will carry some of the economic load as the government works to reduce spending.
But as we are seeing in the US, the UK, Ireland, and now Australia, voters’ reluctance to fully back the platforms of established parties makes this incredibly difficult, leading as it does to weak governments with crimped economic policy agendas.
There is nothing in this world that guarantees mandates to govern will be extended to the established political parties, especially if they campaign on time-worn platforms of being the protectors of public services or the better economic managers. Given the long-term trends, in another three years, who can say where the primary vote will be for the major parties?
While we may be in for years of instability, this is a stunning affirmation of the primacy of voter power. People have warned both major parties that they have work to do not just for the country, but on themselves, if they are to remain relevant and secure mandates in the future.
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