Rudd's Guerilla War

by Glenn Milne - The Australian

Amid the sound and fury of the debate between John Howard and Kevin Rudd over the cause du jour - climate change - something fascinating has been overlooked in the unfolding contest between the two leaders.

And I'm not talking here about the fact that in some lights Rudd can look like a younger Howard, though that point is apposite. No, what I'm referring to is the degree of policy consensus that is beginning to emerge between the two leaders.

The move towards acknowledging this common ground is coming from Rudd. His motives are clear. The new Labor leader has determined two things. First, not to get wedged in areas where he judges the risk of confrontation with Howard outweighs the political benefits. And second, to cede ground to Howard where he thinks the Government is on a strong policy winner.

In other words, Rudd is ruthlessly jettisoning debates he does not think he can win in favour of those he can. In this he has abandoned the stance favoured by traditional oppositionists such as his predecessor Kim Beazley. It is also a function of the limited time available to him before the next election.

Part of it, too, is what Rudd described in an interview with Christine Jackman of The Weekend Australian Magazine as "messing with Howard's head". Rudd's tactics are those of the political guerilla: to strike hard and fast against the weak points in Howard's line, but to withdraw and disappear when confronted by Coalition armour.

So, right now, Rudd is going all out on climate change and Iraq because he judges Howard to be exposed in these areas. But compare Rudd's ferocity on these fronts with his stance on issues such as the macro-economy and education. Listen to what the Opposition Leader had to say yesterday on the Ten network's Meet the Press when he was asked what he would do to keep interest rates low.

"What you can do when it comes to interest rates is run a responsible fiscal policy, which means making sure your budget is in balance across the economic cycle," Rudd said. "In fact we go one better than that, we say that when it comes to budget outlays, the percentage of tax to GDP should not increase beyond that which currently exists under the Howard Government. We think if you've got a responsible budget policy, responsible fiscal policy, it keeps the pressure off interest rates and monetary policy."

Back up for a moment. Isn't that a tick for the Howard Government's economic management?

"That's a bipartisan consensus which goes back quite some time," was Rudd's sanguine reply. "When it comes to monetary policy and fiscal policy, and that's been underpinned by statements by the former Reserve Bank governor Ian Macfarlane and also Saul Eslake from the ANZ Bank, there is essentially a line-up on both sides of politics on this."

By morphing with Howard on fiscal and monetary policy, Rudd pays the Prime Minister a compliment but also hopes voters will no longer distinguish between them in this area. The de facto proposition he is promoting to the electorate is that if Labor wins the next election, Howard's prosperity becomes his prosperity, which, as prime minister, he will manage in a similar fashion to Howard. It's the promotion of the idea of a seamless transition designed to allow voters to cast their ballots on the basis of other issues, such as the Iraq war and climate change.

No wonder Peter Costello is telling anyone who'll listen, behind the back of his hand, that it might not be such a bad thing if the economy hits a few bumps. In the Treasurer's eyes such a scenario would put some voter apprehension back into the election mix, reinforcing the need for superior - and above all proven - economic management.

As it is, Costello fears - perhaps rightly - that a benign and perhaps even positive interest rate climate running into the election, along with record low unemployment, could favour Rudd. The Opposition Leader's strategy of claiming a historic settlement on managing the budget and interest rates is designed to capitalise on exactly those Coalition fears.

Having set out to neutralise the issues of fiscal and monetary policy, by claiming no difference with Howard, Rudd's next step is to drive the economic debate into areas where he thinks the Government is vulnerable. Hence yesterday, after lining up with the Prime Minister on the macro stage, he said: "Where we have disagreement is how do you produce long-term economic prosperity for Australia when you've got declining productivity growth and the need for a rapid increase in investment in education, skills training and infrastructure?"

Rudd is applying the same principles to the education debate, along with this portfolio's spokesman, Stephen Smith: don't waste time contesting the ground you can't win; rather, drive the debate where you can win.

So, on Saturday, Rudd went to a seminar of the national ALP Left in Canberra and delivered a blunt message that again echoed Howard. The Opposition Leader told his audience he wanted to lift school curriculums and reporting standards. Rudd did not beat about the bush: "This may result in resistance from some teachers unions. I understand this. But I will not be signing blank cheques unless we can improve the quality of what we teach our children."

On Friday, Smith was equally blunt behind closed doors at a conference organised by the Australian Technology Network, the umbrella group covering Australia's newer and more progressive universities. He referred to Education Minister Julie Bishop's proposals to give school principals hiring and firing rights, to subject teachers to performance pay and to give parents more information about schools.

Smith explicitly told his audience that Labor did not intend to get wedged on these issues. He went on to say he broadly endorsed these themes, with some important caveats, such as making teachers' performance pay reflect the socioeconomic standing of the schools in which they teach. Having cleared a path through Bishop's carefully laid minefield, Smith then made it clear that Labor would be concentrating its education attack on the Coalition's weakest track: its funding record.

Like all good guerilla fighters, Rudd and his team are travelling light, jettisoning excess policy baggage and selectively hitting where they know it will count. But as Howard's announcement on aged care yesterday shows, he's capable of moving fast as well. Believe me, politically, this year is going to be over in a flash.