From: David Hetherington, Executive Director, Per Capita
To: Hon Kevin Rudd, Prime Minister
You should take the time to write on one page just what it is you want to achieve. You should do that now. Think about it as the final editorials – what you’d like them to say as you leave the job. Here’s our first cut at it:
The Daily Telegraph/Herald Sun: Rudd kept trust while making the big early changes. Everything else has followed from that. He kept his promises. Then the new carbon price, personal accounts in education, and the national water market, were big policy measures. Above all though, the government’s child-centred focus has changed the mould, making long-term economic investment a kitchen table issue.
The Sydney Morning Herald: The focus of economic policy shifted from “budget management” to “human capital investment” and “full cost economics”. What Rudd tagged “the investing society” was really a program of designing growth on the supply-side of the economy through new tools, especially using economic incentives rather than social controls. Carbon emissions reductions are the obvious case. But new investment in water infrastructure plus industry and household efficiencies has followed the new water market, which lifted the price and enabled real economic returns to be gained.
The Canberra Times: The “investing society” also universalised and personalised human services. For individuals, this has delivered historic boosts in private investment in human capital, alongside an uptick in public spending. It has also reformed crucial sectors of the economy, notably education. In effect, the reform forces that changed our private economy thirty years ago have finally reached the public economy this decade. The public sector will never be the same again.
The Financial Review: Rudd’s economic policies lifted productivity, and the value of everything we sell. The wealth generated from the mining boom was invested in productive purposes. As our terms of trade declined because other mineral producers caught up with demand from China, the fall in export income in mining has been offset by growth of exports in other fields. All of this means prosperity has been maintained, with strong employment and stable inflation and interest rates, even as the mining boom has faded.
The Australian: There has been good economic policy and good social form. The genuinely progressive political achievements are broader again. Rudd has changed the way Australians talked about themselves and their politics. Through every event and emergency, he led Australians to a new logic. “Invest, invest, invest.” “Australians share and stick together.” “Fairness and prosperity go together.” “Don’t forget the kids.” And like Hawke, but unlike Keating or Howard, he has been comfortable in his times not futuristic, nor old-fashioned, simply contemporary.
The Age: Rudd has overseen a progressive realignment of Australian politics. There are two proofs of this. First, when he came to power, the question hanging over Labor was whether it could be trusted with the economy, which meant budget control. Today, the question hanging over the Coalition is whether it can be trusted with the economy, which means investing in human capital and designing public markets. Second, his intellectual and policy leadership has forged new alignments of interests, and created a generation of Rudd Liberals: lower-income families in regional towns, especially in coastal Queensland, who had been the target of conservative populism for so long, and the “moral middle-class” who in Australia were historically attached to progressive Liberal politics.
This is an extract from Per Capita’s “Memo to a Progressive Prime Minister.”