The “phony election” hots up. Having at least temporarily buried the WAgate affair, it’s back to basics, at least as perceived by Henry.

Ben Doherty reports for the SMH on “the vision thing” as articulated by Kevin Rudd: “Mr Rudd said Australia’s future lay in an education revolution, in tackling climate change, and in taking a ‘middle power’ leadership role in the world and the region”.

These three issues are all worthy, and Henry would vote for them. But where is “maintaining economic prosperity”? Where is the sign Henry is waiting for that Mr Rudd has thought carefully about this and, as part of this careful thought, decided on his attitude to industrial relations (IR)? The Howard/Costello IR revolution will eventually be seen as a major reform of the Australian economy, equivalent to Whitlam’s cutting tariffs, Hawke/Keating floating the Aussie dollar or Howard/Costello moving (albeit too slowly and too partially) to replace income tax with a consumption tax.

As part of necessary IR reform, neither side has yet grappled sensibly with the “guest worker” phenomenon. Peter Hartcher quotes the other Costello (Tim) on this today:

He is a strong advocate of the idea that Australia should craft a program to allow “guest workers” from the poor nations of the South Pacific to enter Australia. But the Government in which his brother is the Treasurer has dismissed the idea.

These poor nations have “70% unemployment and a lot of poverty”, Costello says “Giving them a chance to work here gives them a stake, allows them an active and dignified way of earning money, gives them a chance to work here and send money home to build there.

The economics of this proposal are clear. This is a win-win. Australia’s battling farmers can get their fruit picked, meaning higher incomes for farmers and better fruit supplies for the latte sippers in Australia’s urban conurbations. The guest workers can send and take money home to inject into the struggling economies of the Pacific.

The Roy Morgan Consumer Confidence Rating, released this morning, found that consumer sentiment dipped 3.1 points in March to 120.7. Henry would expect that rising petrol prices, rather than the recent increased share market volatility, is behind the dip. While there are indeed many more mum-and-dad shareholders these days, most are long-term, buy-and-hold investors, and therefore consider themselves insulated from market ups and downs. Also, the Rating generally falls in March, with the average March rating almost 3 points lower than the average February rating.

As this graph shows, the more widely reported Westpac-Melbourne Institute measure of consumer confidence closely follows the earlier Roy Morgan Consumer Confidence Rating. The Westpac-MI measure is released next Wednesday – bond traders take note.

Read more at Henry Thornton.