InvestSMART

Labor must learn to sell its good economic news story

TUCKED away in this paper's business section on Monday was an item about an Australian Council of Superannuation Investors report on executive pay. The article began: ''A decade-long study of ASX 100 companies has found that while their share values increased by just 31 per cent, the pay packages of their chief executives more than doubled.'' The report found that the average chief executive's total pay package last year was $4.9 million.

TUCKED away in this paper's business section on Monday was an item about an Australian Council of Superannuation Investors report on executive pay. The article began: ''A decade-long study of ASX 100 companies has found that while their share values increased by just 31 per cent, the pay packages of their chief executives more than doubled.'' The report found that the average chief executive's total pay package last year was $4.9 million.

TUCKED away in this paper's business section on Monday was an item about an Australian Council of Superannuation Investors report on executive pay. The article began: ''A decade-long study of ASX 100 companies has found that while their share values increased by just 31 per cent, the pay packages of their chief executives more than doubled.'' The report found that the average chief executive's total pay package last year was $4.9 million.

Clearly, the 21st century has proved to be a good time to be an Australian CEO - certainly much better than being an average wage-earner. The article also noted the report's finding that over the decade, chief executives' ''133 per cent increase in median pay, and 190 per cent increase in bonuses, far outstripped average wages growth (53 per cent) and inflation (28.6 per cent)''.

And yet, it's not chief executives who are in the gun right now over the nation's sluggish productivity performance, it's ordinary workers who - some company heads and pretty much all employer representatives say - have too many workplace protections and too much bargaining power for the economy's good.

In normal circumstances, it should be easy for a Labor government to dispense with the argument being put by business against its Fair Work laws, given that the laws represent fairly faithfully the policies that the ALP took to the 2007 election.

Those policies were supported back then by a firm majority of Australian voters. It could be expected, only four years after that endorsement, with an economy that continues to grow, has a low level of public debt and is managing, just, to hold the line on inflation, that running the counter-argument would be one of the government's less difficult tasks.

But these aren't normal times. For decades, economic policy has provided the conventional battleground on which the political debate between the Coalition and Labor has been conducted, and the peculiarly Australian twist in the economic policy discussion has long been our incurable obsession with home mortgage interest rates.

But interest rates aren't near the top of the national agenda in 2011. Nor is economic policy the central point of contention between the government and the opposition in today's politics. Of course, their rhetoric separates them by a mile to the extent that in the past the major parties could agree on anything, they certainly can't now.

Tony Abbott's blitzkrieg approach to his job as opposition leader has fashioned the assault on Labor as a sort of meta-critique: the government cannot do anything right, it never has a good idea and it is thoroughly unworthy. Because the government has never been legitimate, nothing it advocates is worth considering.

By applying this critique, the opposition does not have to get too bogged down by details in the government's policies - or in its own. Abbott and the shadow treasurer, Joe Hockey, are able to play loose, although it has to be said that Abbott, who in the past has professed little interest in economics despite his holding of a BEc, tends to keep away from economic policy.

The opposition's approach has contributed to the becalming of the economic debate but, of course, it's far from the only factor. The agitated, hectoring public style of Treasurer Wayne Swan has not allowed him to be the sort of storyteller on policy that Paul Keating and Peter Costello were when they held the portfolio.

The unfortunate consequence of this for Labor is that it has been harder for the government to run out a consistent, articulate and above all seductive portrayal of its economic achievements.

Another factor is the media. In Keating's days as treasurer, and for most of Costello's time, the mainstream media moved at a slower pace and were better resourced. They had the time, space and, sometimes, the inclination to explore and explain areas such as economic policy at greater length. Competitive, technological and financial pressures have tightened the focus of today's media. The attention spans of many media consumers, especially among the young, have also shortened.

The American comedian and writer Albert Brooks, in his new novel Twenty Thirty - The Real Story of What Happens to America, a satirical imagining of the US 19 years from now, captures the emerging media environment: ''There were no trusted sources of news-gathering any more, no voice of one news organisation or one reporter that people believed over another. It was a combination of professionals, amateurs, citizens, gossip, pictures fed to a world from billions of hand-held devices a whole slew of information that people had to somehow slog through and decide for themselves what they thought was true.''

The fragmentation of the media, and the rapid increase of the pace of the news cycle, makes it even more important for any politician to carry the message rather than relying on the media to do it for them.

What all this means for the government and the opposition is that primacy in the economic debate is there for the taking - one of the few bits of potentially good news around for the ALP. The polls suggest that the public's default position is that it favours the Coalition to manage the economy. But this is one policy area where the power of incumbency can change perceptions. The government's chief problem is that it has not been able to settle on a way of imprinting its economic policy victories on the public consciousness.

If anything, it has found new ways to take good, potentially saleable ideas and turn them into a dead weight. In the three months prior to last year's election, it comprehensively messed up the announcement and implementation of the resource rent tax. The ambush-like presentation of the tax proposal robbed it of votes and credibility.

However, a year later the idea behind the tax is well-received by most voters. An Essential Media poll taken last month suggested that 58 per cent of voters approved of the government's introduction of a tax on large profits of mining companies, while only 29 per cent disapproved. It takes that long for ideas to settle in the public mind.

The problem for the government is typical of its experience in office: its policy has won approval - eventually - but Labor ultimately gets next to no credit from the public for introducing it. There is still time for Labor to hit the reset button and set out to pursue a much greater slice of the credit from the public for its stewardship of the economy - something that has largely eluded it since it took office 46 months ago.

Above all, the government needs to settle on its good story on the economy - and a good storyteller.

Shaun Carney is an associate editor.


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