Game Changer – Professor John Hewson AM

anu

 

 AUSTRALIAN NATIONAL INSTITUTE O F PUBLIC POLICY

ADVANCE POLICY SERIES May 2014

Professor John Hewson is an economic and financial expert with experience in academia, business, government, media and the financial system.

He has worked as an economist for The Treasury, The Reserve Bank of Australia, the IMF, and as an advisor to two successive Federal Treasurers and the Prime Minister.

His academic career includes 11 years as the Professor of Economics and four years as the Head of the School of Economics at The University of New South Wales, recently two years as Dean of Macquarie Graduate School of Management at Macquarie University. He is currently a Professor and Chair in the Tax and Transfer Policy Institute  at Crawford School of Public Policy, ANU College of Asia and the Pacific.

Professor Hewson’s business career before entering politics in 1987 was as a company director and business consultant, and included roles as Foundation Executive Director, Macquarie Bank Limited, and as a Trustee of the IBM Superannuation Fund.

Professor Hewson’s political career included seven years as a ministerial advisor and a further eight years as the Federal Member for Wentworth in the Federal Parliament. He was Shadow Finance Minister, Shadow Treasurer and Shadow Minister for Industry and Commerce, then Leader of the Liberal Party and Federal Coalition in Opposition for four years.

Since leaving politics in early 1995, Professor Hewson has run his own private investment banking business, including as director/advisor of a wide range of companies and was, until December 2004, a Member of the Advisory Council of ABN AMRO, having previously been Chairman of the Bank. In addition, he is Chairman of GSA, Apricity Finance,  Shartru Capital and Shartru Wealth. He is also Chairman of two major charities, Osteoporosis Australia and KidsXpress, and is Chair of the Investment Advisory Committee of the Australian Olympic Foundation. Professor Hewson writes and comments widely across the Australian media, including as a weekly panelist on the Sky News Agenda program.

A principal focus of Professor Hewson’s career has been in Asia, where for more than 30 years he has developed a wealth of contacts and experience in government and business, and as a consultant to international agencies such as the IMF, UNESCAP and the Asian Development Bank.

Professor Hewson has recently served as Special Advisor to the Secretary General of the UN Economic and Social Commission for Asia and the Pacific, and he is a member of the Trilateral Commission.

Australian politicians need to stop treating politics as a game, and get on with implementing good policy, writes Professor John Hewson

On the first day of 1993’s new Parliament, Paul Keating took me aside, ostensibly to “apologise” for all the “nasty names” he had called me over the years, and to record that he actually “quite respected” me, and that he could have accepted “losing to me”.

However, he went on to say that I needed to understand that, to him, “politics is just a game, and I will say or do whatever I have to, to win”.

As naïve as I obviously was, I had never thought of politics as a game.

I’d thought of government as a business; perhaps the biggest business in Australia. So Paul challenged me. I was challenged, that here was the man who, having just been rolled by Bob Hawke on his own tax reform proposals back in 1985, and who had promised in Parliament to die fighting for a broad-based consumption tax, could so easily have run the mother of all scare campaigns against my Fightback GST proposal in 1993.

I was challenged too by the media failing to hold him accountable for such a change of heart, let alone lack of commitment.

I clearly should have read HL Menken, often regarded as one of the most influential American writers on politics of the early 20th century.

According to Menken, “the whole aim of politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary”.

More fool me for not believing in the monsters under the bed.

As Shadow Treasurer, and then Opposition Leader, I actually tried to be substantive and constructive, rather than political, attempting to lead the policy agenda in areas like monetary policy, tariff reductions, labour market and microeconomic reform.

I had entered politics as an advisor in the early Fraser years, in the belief that good policy is good politics, with a relatively short lag.

I moved to the office of the then Treasurer, Phillip Lynch, on secondment from the Reserve Bank of Australia. By then, I was already a frustrated bureaucrat, recognising that, in the end, under our system of government, policy is mostly (knights and dames excepted) finally made in the Cabinet Room.

While accepting that politics may be more rampant and unpredictable in that room, I still believed that one should be able to win on the substance of the policy argument. If you wanted to be part of serious policymaking, I believed that you had to at least be heard in that room.

Unfortunately, politics has progressively become even more of a game over the last couple of decades. Indeed, now almost an end in itself, the contest is to win the 24-hour media cycle, at all costs. Policy substance and debate has been almost totally eschewed.

The focus has become increasingly short-term, opportunistic, and pragmatic. Political positions and daily messages are driven mostly by polling, especially focus group responses, rather than by evidence-based policy, or even ideology.

The game moves almost daily, from one issue to the next, from one location to the next. As it does, the media and other independent commentators mostly get swept along, with little time or incentive to dig into the substance of an issue, or to attempt to insist on transparency and accountability. They are left to focus on the ‘colour and movement’ of it all.

The so-called policies taken to the last election were little more than dot points in a Powerpoint presentation – Stop the Boats, Repay the Debt, Build the Infrastructure of the 21st century, full stop.

The game has become very tribal, bitter, personal, and mostly negative. The whole process has been an attempt to ‘dumb down’ the electorate, as the key tribes produce their own evidence and accounting, and then chant it, or spin it, almost incessantly, as if it’s fact.

But no matter how much you repeat a mantra, clinging to simple slogans is no way to ‘move forward’.

Well-funded vested interests can easily buy their way into the game, presenting their own facts, easily intimidating mere politicians and their advisers to acknowledge the substance of their power, and their capacity to cause alarm.

Add to this a host of other factors – the drift to political apparatchiks as members of Parliament; the creeping politicisation of the public service; the widening gap in many areas between public and private salary packages; and the weakened influence of academia and think tanks, just to name a few.

The bottom line has been very worrying policy drift, and the stalling of most genuine structural reform, especially over the last decade or so.

…politics has progressively become even more of a game over the last couple of decades. Indeed, now almost an end in itself, the contest is to win the 24-hour media cycle, at all costs.

But as disturbing as these trends are, this debilitating process may have just about run its course.

While the whole process as described is essentially Canberra-centric, politics is not actually confined to Canberra. To the average voter, politics is actually policy outcomes. They do not see or experience policy as a political argument. They see it as a tax, or a benefit, or a freedom or restriction, or a military deployment, and so on.

As the gap between expectations and outcomes has grown with many issues – with neglect of some issues seeing them drifting towards crisis – the pressure for real solutions is mounting. Ultimately, there is no way a government can spin its way out of a conspicuous policy failure, out of a recession (even if you try to argue that it is “the recession we had to have”), a skyrocketing cost of living, some climate change induced crisis, or a major military or diplomatic failure.

There is a unique, but urgent, opportunity for leadership, to break out of the short-term game of politics.

There is a limit to just how long a government can survive with poor policy, based on ‘manufactured evidence’ or argument. There is a limit to how long a government can survive failing to sustain a reform agenda. Scare campaigns ultimately lose their effectiveness, especially if they are replayed like a scratched record. The new Abbott Government is now under real pressure for substantive policy responses, virtually across the whole spectrum of economic, social and environmental, policy issues.

The fact is, some issues like climate change require urgent action now, and that will need to be sustained through the life of several consecutive governments. The electoral challenge is intergenerational.

Most unfortunately, given the devastated state of political debate in Australia, other pressures and opportunities will probably have to drive a more substantive response by our governments – pressures from global leadership (like the US or China), international agreement(s) on emissions reductions, and/or technological advancements.

In these circumstances, there is a unique, but urgent, opportunity for leadership, to break out of the short-term game of politics.

But it will only happen by being prepared to address key issues with substantive and sustainable policy responses. And, where necessary, being prepared to debate, educate and engage the community as to the necessity and desirability of these policies.

Naïve as I may be, I still live in hope.

Australian National Institute of Public Policy (ANIPP)

The Australian National Institute of Public Policy is a strategic partnership between ANU and the Australian Public Service and is located at Crawford School. The Institute enhances public policymaking in Australia by strengthening the already substantial engagement between the public policy community and policy-relevant research expertise drawn from across ANU. ANIPP encompasses: ANU Public Policy Fellows program, HC Coombs Policy Forum, Executive Education program, Crawford School’s flagship journal, Asia and the Pacific Policy Studies, and two new Foundation Institutes: Social Policy Institute and Tax and Transfer Policy Institute.

Advance Policy Lunch series

The Advance Policy Lunch series is a new initiative by ANIPP, working closely with our valued ANU Public Policy Fellows in the public service. The regularly-scheduled Policy Lunches involve an academic expert presenting on a topical issue in their field of research. The academic experts come from the rich pool of academic excellence across the ANU campus, ANU Public Policy Fellows and ANIPP’s Foundation Institutes. The aim of the Policy Lunch series is to enable academic experts from across campus to engage with senior public servants on matters of interests to both sectors, and to facilitate policy debate and discussion.

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Source: Crawford School of Public Policy, ANU College  of Asia and Pacific

www.crawford.anu.edu.au