Postscript chapter from: J.J. Ray (Ed.) "Conservatism as Heresy". Sydney: A.N.Z. Book Co., 1974
Postscript - The 1974 Elections
By John Ray
The 1974 Australian elections had a number of general lessons for us that seem well worth pointing out. For the first time in Australian history a Labor government was re-elected. It was an election nominally fought on the issue of inflation but really fought, I will argue, on personalities. To a remarkable degree it was a re-run of the 1972 election-- particularly with respect to the outcome of modest ALP success in the lower house accompanied by failure to gain control in the Senate. It must be remembered that even a tied vote in the Senate is in legal effect a 'No' vote.
A most revealing sham of the election was the agreement on both sides that the ALP was 'socialist'. To the ALP this was a boast while to the L-CP it was an accusation. In fact, as one or two commentators pointed out, the coalition parties were clearly the more socialist in what they proposed. 'Socialist' is of course one of those words more remarkable for its emotional associations than for its exactitude. Roughly, however, it always seems to have something to do with increased central government participation in the economy. Historically, this participation was supposed to take the form of 'nationalisation'-- central government takeover of some or all industries. Australia, of course, is blessed by a constitution which unwittingly makes nationalisation impossible. A successful High Court challenge to a previous Labor government's bank nationalisation legislation in the 1940s made this clear. The result has been that the realists of the ALP have forced the party to abandon this route to bureaucratic empire and forced them to concentrate instead on 'welfare' measures. To the ALP now, 'socialism' has come to mean little more than 'caring' --where the socially deprived are the ones cared for and the caring is expressed by government handouts in cash or in kind. This, however, is a very poor identification mark -- as all parties can, and do advocate various sorts of handouts to various disadvantaged groups.
On the other hand, the Whitlam government has done a great deal to promote the efficient functioning of the market economy. It is of course market forces that conservative economists champion as a means of economic regulation rather than the bureaucratic controls of classical socialism. The reduction of tariffs, the reliance on monetary policy, the revaluation and semi-floating of the Australian dollar, the elimination of rural subsidies and the attempt to strengthen legislation aimed against collusive trade practices must have the approval of conservative economists everywhere. In all these respects the Whitlam government took measures that our supposedly conservative previous government could have taken but in fact failed to take.
In fact, the L-CP coalition in the 1974 election campaign advocated the reversal of most of these measures. It advocated restoration of the old tariffs, subsidies and exchange rates. It was even so monumentally irresponsible as to advocate a deficit budget in a time of high inflation. By contrast, Whitlam advocated a balanced budget. Although a surplus budget was probably what was really called for. The ALP did at least come closest to it.
The L-CP, then, became the socialists-- advocates of handouts to selected recipients (mostly farmers) and interference in the natural market mechanisms for resource allocation. It was as irresponsible and as wild in its promises as as the ALP had been in 1972. In this respect the 1972 election was indeed re-run-but with the major parties in reversed roles.
This reversal of roles is probably a symptom of the very slight differences that there are between the two parties. What determines their realism and economic responsibility is not any matter as mere as ideology but rather whether or not they are in power. This phenomenon has its pluses and its minuses. The minus is that whenever a change of government takes place, the party acceding to power will be committed to a whole host of expensive and unrealistic promises that the community ultimately has to pay for. The usual route to paying for these would appear to be the inflation of the currency. It happened that way immediately after Menzies' accession to power in 1949, after Whitlam's accession to power in 1972 and it most certainly would have happened (given the promises made) had Snedden acceded to power in 1974. The conclusion from this, then, is that the country secures considerable economic gains every time it does not change government. If the party in power is always more responsible, it might be argued that one should always vote for whatever party is in power.
The plus to be found in the phenomenon of similarity between the parties is that whoever gets into power, ninety-five per cent of the electorate will still be getting pretty much what they voted for. Consensus politics are one of the greatest achievements of the twentieth century and may represent the finest flowering of democracy so far. Contrary to the misrepresentations of disgruntled intellectuals, consensus politics do not represent a lack of choice being available to the electors. If Liberal voters had thought their party was drifting too far Left, they could perfectly well have voted for the DLP. They did not. If Labor voters had thought their party was drifting too far Right, they could have perfectly well have voted for a whole host of alternative Leftist parties -- from the Communist Party to the Australia Party. They had the choice but they did not take it. The fact that the two major parties won the allegiance of something like ninety-five per cent of the voters by advocating policies that were in most respects almost identical, is a powerful reflection of the homogeneity of sentiment and lack of conflict in Australian society. Burkean conservative ideals of community harmony were never so well realised as they are where consensus politics prevail. The countries which lack consensus politics --such as those of South America-- certainly suffer severely for it.
In this contest one can also argue that political apathy is a good thing. Nobody in South America is apathetic. Apathy must often be a sign that things are being run pretty much as well as can reasonably be expected. If there is little difference between the major parties and no likelihood of other parties improving things, why worry about politics indeed? Apathy is then the symptom of a well-run and harmonious society.
What then were the issues that were put before our 'consensual' society in the 1974 election? The ostensible issue was certainly inflation. The fact that the ALP had been able to implement its 1972 promises only by dint of raiding the little man's savings was certainly an issue that a more charismatic figure than Mr Snedden might have used to discredit Labor completely. The fact is that Mr Snedden did indeed have a great deal going for him in his raising of the inflation issue. Not only was it something of great immediacy to almost every elector (everybody had been affected in some way by rising prices) but it was something that Mr Snedden himself had a proven record of controlling. In his last spell as treasurer, he had succeeded in reducing inflation from 6 per cent to 4.6 per cent. This was a marked contrast with the 13 per cent prevailing under Labor.
Now the average elector could hardly be expected to decide on the rightness of the varying arguments put up by economists and others about whether Mr Snedden's proposals would or would not be effective in reducing inflation. When the experts disagree, the average voter cannot be expected to take much notice of any of them. What he can be expected to do is look at the past record of those who are contending for his vote -- and this Mr Snedden did have on his side.
Clearly then, what was lacking was personal plausibility on Mr Snedden's part. He had the record but he still did not inspire confidence. So in the event I believe the election was once again decided on personalities rather than on policies. As someone put it, compared to the plausibility of Mr Whitlam, Snedden was merely 'McMahon with hair'. This tendency to vote on personalities is a trend that I welcome -- just as above I welcome political apathy. It too is symptomatic of the absence of any major policy cleavages. It is another of the stigmata of consensus politics.
In the event, the verdict of the voters was given for economic rationality. Mr Snedden's promises were certainly more inflationary than Labor's. In a fully employed economy, there is no way a government can reduce taxes and at the same time spend more unless it especially creates the extra money. The money has to come from somewhere, even if you have to print it. Printing extra money, however, only devalues that which is already in circulation. It doesn't magically create extra goods and services for that money to buy. If there is any need for proof of this, the result of the 1973/1974 Labor government's attempts to fulfil its 1972 promises should be evidence enough.
To many observers, the fact that the ALP could gain control of the lower house (and hence the government) but not gain control of the Senate may seem strange and wrong. The Senate is a powerful house (with complete power of veto) and it too is elected on a universal franchise. How then the contradictory outcome?
The answer is that the Senate has regained part of that precise function which the writers of the Australian constitution intended it to have. It has gained some function as a States' house -- a house where the smaller States of the Commonwealth can keep watch on central government actions which might run contrary to what they see as their own best interests. The ALP lost control of the Senate in Queensland -- by failing to get there its normal share (fifty per cent) of the State Senate team. It suffered this loss for precisely the reason that the writers of our constitution foresaw -- the reason being that Queenslanders (who are chronically suspicious and resentful of 'Southerners') felt the Whitlam government was causing financial and material loss to Queensland by its policies. The writers of the constitution thought that a State's Senate team would have to vote en bloc in order effectively to oppose a disfavoured central government. In our days of party politics it has been shown that in fact a disfavoured central government can be hampered quite effectively if only six out of ten of the State's Senate team is in opposition. In becoming a house dominated by party-politics, the Senate has still not lost its intended function as a States' house.
The loss of all four of the ALP's referendum proposals is something that conservatives can only applaud. All of them favoured the increased centralisation of power in Canberra that the ALP stands for. With talk of secession in our two largest States, any more moves in this direction would be foolish indeed. To New South Welshmen and Victorians the structure of sovereign State governments as well as the Federal government often seems absurd indeed. It is not so absurd to Queenslanders and West Australians. They can see some benefit in being governed from nearer to home. To weaken these federal arrangements would be not only going against the worldwide demand for decentralisation of power but would in plain fact endanger the structure of compromise upon which our constitution is built. I am amazed that West Australians do not secede. It would be so evidently in their own economic self interest not to share their mineral wealth with the rest of us that it can only be the great stresses and disruptions that secession would entail which deters them. In these circumstances, we certainly do not want to add fuel to the secessionist flames. Without Queensland and West Australia, we would be infinitely poorer materially and in every other way.
The actual reason for rejecting the referendum proposals, however, probably had little to do with considerations such as the above. It does seem that the Australian people just will not pass referendum proposals in any circumstances other than where widespread consensus prevails. The feeling evidently is that the implications of referendum proposals are hard to assess so to be on the safe side it is best to reject them. Thus any proposal that is the subject of disagreement between the parties will be rejected. It is not even enough that the opposition is confined to one of the minor parties. In the last referendum that was passed, the Commonwealth government was given power to legislate concerning Aborigines precisely because everybody was in favour of it. The second proposal in the same referendum, however, (the so-called 'nexus' proposal) was rejected -- even though the major opposition emanated from the DLP only.
I would argue that this state of affairs is precisely as it should be. The place for regulations that are subject of party political dispute is the statute book. The place for regulations that are the subject of general agreement is the constitution. Constitutional amendments are not a way to bypass the legislature -- as the Whitlam government seems to hope.
In conclusion, then, I believe that in 1974 the conservative thing to do, if you wished to vote at all, was to vote ALP. This is obviously far from an endorsement of all the ALP's policies. It is perhaps more importantly a condemnation of the sad state of our supposedly conservative opposition.