Saturday, November 18, 2006

Federalism is a safer way

"Does the end justify the means?" is one of the oldest of philosophical conundrums.

The objective of Work Choices, to liberalise the labour market, is a worthy one.  It's an objective consistent with the principles of the Liberal Party and with the principles of liberal democracy itself.

The right of individuals to sell their labour under the conditions they choose is as inalienable as their right to own property (although whether the bureaucratic regime established by Work Choices actually does what is intended is debatable).

The problem is the means the Liberal Party has used to achieve its objective.

On Tuesday, when a majority of the High Court upheld the constitutional validity of Work Choices, the judges sanctioned a further body blow to federalism.

Federalism was once a principle of the Liberal Party.

Managing conflicting principles is part of the art of politics.  In the reality of the day-to-day practice of power in the corridors of Parliament House, principles come and go -- but a senate majority comes around once in a lifetime.  The temptation to take advantage of the electoral fluke of 2004 which delivered the coalition the control of the Senate was not able to be resisted by the Howard government's ministers.

Prime Minister John Howard was absolutely sincere when he said he had no desire "to embark upon some orgy of centralism" -- but others might not be so reluctant.  The statement by the federal Attorney-General, Philip Ruddock, the day after the High Court's decision was not a good omen.  He said that if the states did not regulate the legal profession the way he wanted then the Commonwealth would do it.

One of the great benefits of federalism is that it doesn't discriminate.  It imposes the same limits on all politicians, regardless of whether they are acting from the best of reasons, as Howard is, or the worst of reasons, as Gough Whitlam did.

The point that the coalition will not be in government forever has been well made in the past few days.  A government under Kim Beazley, Kevin Rudd or Julia Gillard with a sympathetic senate could undo Work Choices with the stroke of a pen.

Another thing that hasn't been lost in the discussion is the capacity of the Commonwealth to intervene in a wide array of new areas.

As Michael Kirby, one of the two dissenting judges, identified, everything from town planning to gaming is now within the purview of the Commonwealth.  He's absolutely correct when he labels this a quite "radical" outcome.  If a conservative High Court (four of the five judges in the majority were appointed by the coalition) is willing to undertake this sort of constitutional reconstruction, one can only wonder what would happen if ever the court wasn't conservative.

What's been ignored so far is the potential of the decision to produce an outcome that is the exact opposite of what Australia needs.  Instead of accelerating the process of economic and social policy reform, the High Court's decision might reverse it.

The task of reform cannot be left to just one level of government.  Any process of change works best when it is carried by a critical mass that can support and critique what is happening and that can sell the benefits of reform.

State premiers will no longer need to risk their political capital on reform if they expect the Commonwealth to bypass them anyway.  The days of a Nick Greiner or a Jeff Kennett are over.

It has been assumed that because Australia has been lucky enough to have two decades of federal Labor and then coalition governments committed to reform, we will always have national governments of this character.  This is naive in the extreme.  It's that sort of thinking that leads people to fantasise that because the stockmarket is going up it will always go up.

Tragically, just as the rest of the world is discovering the limits of standardisation and uniformity, Australia is moving in the opposite direction.  That great experiment in centralisation, the European Union, is a financial and political failure.  Meanwhile, the United States, with all of its competition and diversity, prospers.  In that country the states are getting more power, not less.

In a federation, if one level of government fails there is the opportunity for another level to fix that failure.  In Australia that chance is now gone.

After last Tuesday, the consequences of a failed federal government won't just be bad.  They'll be disastrous.


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