The Kevin Rudd Saga: Lessons for Politicians

The Kevin Rudd Saga: Lessons for Politicians

Hugh Pavletich FDIA
Performance Urban Planning
Christchurch
New Zealand

June 30, 2010

John Muscat, co editor of the New South Wales, Australia, based The New City website has a superb article The Urbanist’s Guide to Kevin Rudd’s Downfall on the United States based New Geography website, providing his perspective on why former Australian Prime Minister Kevin Rudd was removed from office.

It seems clear Mr Rudd lost his position for the major reason he was seen as “all talk and no action”, with an inability to lead on major issues.

Rather surprisingly, Mr Muscat within his article did not mention the important Fitch Ratings research commissioned by the Sydney Morning Herald, following the 2007 Federal election. Stuart Washington of the Sydney Morning Herald, explained the results of this research within the article Fear of losing homes drove Labor win. It was clear from this research, those with excessive mortgages swung solidly to Labor at the 2007 Federal election.

The clear message here is that voters ask themselves one simple question when they vote – all things considered, which political party best meets my needs?

In the run up to the 2007 Federal election, the Howard Liberal Government, with the politically disastrous statements by Treasurer Peter Costello, had lost the confidence of the aspirational voter. Voters knew the then Liberal Federal Government was more interested in special interests, such as the protectionists within the property industry.

Australia’s lead industry group, the Housing Industry Association “broke ranks” with other responsible industry groups during early 2007, deliberately confusing housing issues. The HIA unilaterally switched from the real structural issues, to a “prop up the bubble” campaign, where the emphasis was to extract Federal taxpayer financing, to protect the interests of the urban land bankers.

In other words – how to keep house prices inflated to in excess of 8 times household earnings (when they should not exceed 3 times) within the major urban areas – and unnecessarily throw Federal taxpayer funds at first home buyer subsidies and entice them in to excessive debt. The Banks were happy enough with this arrangement as well of course.

There were enormous financial and political pressures on the urban land bankers to protect the bubble values of their large land holdings. They needed no encouragement to protect their own financial interests. Whatever it took.

In contrast - lower mortgage and living costs were what the majority of voters were looking for and environmental issues were likely a minor consideration. Mr Muscat within his article makes mention of environmental and “smart growth” (forced urban consolidation) issues being a major factor. The Fitch Ratings research for the Sydney Morning Herald made no mention of this. It is well known voters take little interest in urban Local Government issues and performance, as this recent shocking and sometimes entertaining whistle blower story of the United Kingdom's Daily Mail illustrates.

Because of the poor governance and management standards of Local Authorities (Parkinsons Law), they essentially use environmentalism and “smart growth” (in reality – no growth) as a “sales aid” to mask their inability to cope with growth and meet their infrastructure responsibilities.

To be clear – the United Kingdom local government employees illustrated within the Daily Mail article do not throw 6 month paid “sickies” in Thailand, because of their deep concern for the environment. British Local Authority employees do not have a monopoly on inefficiency and poor performance.

Mr Muscat within his New Geography article “The Urbanists’s Guide to Kevin Rudds Downfall” explains how the housing affordability issue was a “hot topic” during the 2007 Australian Federal election campaign. Mr Rudd and the Labor team were very clear that they were going to deal with the real structural issues of inadequate land supply and inappropriate infrastructure financing.

The Liberal Government during 2005 and 2006 was becoming increasingly convinced that the structural issues impeding the provision of affordable housing had to be dealt with. Indeed the Federal Treasurer Peter Costello launched the important book The Tragedy of Planning: Losing the Great Australian Dream by Dr Alan Moran of the Melbourne based Institute of Public Affairs to much fanfare. Mr Costello expressing his Governments commitment to restore affordable housing.

The Annual Demographia International Housing Affordability Surveys first released in early 2005, had reignited the public conversation on housing affordability issues, following the disastrous Australian Productivity Commission Housing Affordability Report released in 2004, which killed the issue stone dead at the time.

Australia’s housing is the most severely unaffordable of what is loosely termed the Anglo world.

It appears now Australia’s new Prime Minister Julia Gillard has “rediscovered” the political importance of Australia’s aspirational voters, if her first speech is any guide. It needs to be remembered though that in her predecessor Kevin Rudds 2007 election night speech, he said much the same thing – and failed.

It seems likely Australian voters and the media will now be demanding real policy solutions in the run up to this election.

And importantly too – politicians within Australia and elsewhere will learn from Mr Rudd’s experience.

ENDS

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