Andrew Leigh

SMALL-L LIBERALISM AND THE LABOR TRADITION*

KEYNOTE ADDRESS - SECOND ANNUAL HISTORY AND THE HILL CONFERENCE - AUSTRALIAN POLICY AND HISTORY

MELBOURNE

13 JUNE 2019

I acknowledge the Wurundjeri people of the Kulin Nation and pay respect to their elders.

In many countries, social democrats are on the ropes. In the United States, Republicans control the White House and the Senate. At a state level, 23 states are fully controlled by Republicans, compared with just 15 by Democrats. In Britain, the internal turmoil inside the Conservative Party has not translated into support for Labour, with prominent Labour figures now joining the Liberal Democrats. In Germany, the 2017 election loss saw the social democrats record their worst defeat in the post-war era. In France, social democrats came fifth in the presidential election. Social democrats have also seen a collapse in their vote in the Netherlands, Italy and Hungary.

And then there’s Australia, where Labor – pushing for change and progress – was unable to unseat a government that lacked any discernible agenda, which had burned through three Prime Ministers in six years, led by a man who had been sacked by Fran Bailey as head of Tourism Australia. So yes, we’re licking our wounds right now, and regrouping.

Meanwhile, the rise of far-right populist parties has continued apace. Like One Nation in Australia, the past decade has seen the growth of extremist parties such as Alternative for Germany, the French National Front, Poland’s Law and Justice party, the Danish People’s Party, Vox in Spain and the Italian Northern League. In the recent European elections, hard-right parties increased their share of the vote from 21 to 23 percent.

For the Australian Labor Party, one of the world’s oldest progressive parties, a sense of realism about the challenge shouldn’t diminish a sense of pride in our achievements. The Sex and Race Discrimination Acts. Medicare. Floating the dollar. Scrapping the tariff barriers. Universal superannuation. Bringing Australia through the Global Financial Crisis without a recession. The National Disability Insurance Scheme.

But we must also recognise that parties need to renew. For the Labor Party, I believe that our renewal may be found in an unlikely spot: welcoming not only those inspired by egalitarianism, but also those motivated by social liberalism.

In the United States, if you want to insult a right-winger, call them a ‘liberal’. In Australia, if you want to insult a left-winger, call them a ‘Liberal’. In both countries, liberalism has become detached from its original meaning.

It’s time to bring Australian liberalism back to its traditional roots. Small-L liberalism involves a willingness to protect minority rights (even when they’re unpopular) and a recognition that open markets are the best way to boost prosperity.

Social liberalism means standing up for minority rights, and recognising that open markets are fundamental to boosting prosperity. To borrow a phrase from journalist George Megalogenis, Labor needs a commitment to markets and multiculturalism.

To recognise Labor is the natural home for social liberals, it is first important to say something about Labor’s past.

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Exiled in the Polish town of Poronin in 1913, Vladimir Ilyich Lenin had plenty of time on his hands. Having already spent three years in a Siberian jail, he was biding his time to return to Russia. And so the man who would soon serve as Russia’s first Communist leader turned his attention to the antipodes.

Like many progressives around the world, Lenin was struck by the way that the Australian Labor Party had swept into parliament. Just a few months after the party’s formation in 1891, Labor won 35 out of 141 seats in the NSW Legislative Assembly. In 1899, Labor won government in Queensland (it lasted a week). In Australia’s first national elections, Labor won 24 out of 111 seats in the House of Representatives. In 1903, the Labor vote doubled. In 1904, Chris Watson became Labor’s first Prime Minister. Other parties were struck by the strength of Labor’s support, and the energy and youth of their leaders.

And yet Lenin was puzzled. In 1913, he wrote:

‘What sort of peculiar capitalist country is this, in which the workers’ representatives predominate in the Upper house and, till recently, did so in the Lower House as well, and yet the capitalist system is in no danger? … The Australian Labor Party does not even call itself a socialist party. Actually it is a liberal-bourgeois party, while the so-called Liberals in Australia are really conservatives.’

A century on, and Lenin’s characterisation of the two major parties in Australia stands up better than most of his ideas. Unlike many other commentators, Lenin discerned that Labor was not solely driven by a belief in egalitarianism. Even in its early decades, the ALP was also a party that welcomed social liberals.

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In my first speech to parliament, I argued that the Labor Party stands at the confluence of two powerful rivers in Australian politics. We believe in egalitarianism – that a child from Aurukun can become a High Court Justice, and that a mine worker should get the same medical treatment as the mine owner. And we believe in social liberalism – that governments have a role in protecting the rights of minorities, that freedom of speech applies for unpopular ideas as for popular ones, and that all of us stand equal beneath the Southern Cross. The modern Labor Party is the heir to the small-L liberal tradition in Australia. As my friend Macgregor Duncan likes to put it, ‘Labor is Australia’s true liberal party’.

Alfred Deakin was one of the earliest Australian leaders to make the distinction between liberals and conservatives. Deakin argued that liberalism meant the destruction of class privileges, equality of political rights without reference to creed, and equality of legal rights without reference to wealth. For Deakin, liberalism meant a government that acted in the interests of the majority, with particular regard to the poorest in the community.

Deakin’s Australian version of liberalism drank deeply at the well of the British Liberal Party. In the late-nineteenth century, Deakin’s speeches frequently noted that the British Liberal Party was a positive force that sought to resist and overturn economic and class privileges throughout society. To Deakin, two of the British Liberals’ greatest achievements were the legalisation of unions in 1871 and removal of ‘religious disabilities’ tests levelled against non-conformists and Roman Catholics.

As a member of Victoria’s pre-Federation parliament, Deakin began sketching out the parameters of antipodean liberalism. Deakin was a great supporter of the Anti-Sweating League meetings, highlighting the exploitation of women’s labour (or ‘sweating’) in that state’s factories. For his role in making these workplaces more tolerable, Deakin earned the moniker ‘the father of Factory Legislation in Victoria.’ He supported a Victorian Education Act that sponsored only non-denominational schools: a particular sticking point with Irish Catholic legislators. And in his campaign for Federation, Deakin’s vision and idealism helped the movement overcome setbacks and bypass the blockers.

On race and trade, Deakin’s views were shaped by the time. He supported discriminatory migration policies and high tariff walls. Looking to the Asian region, he saw only danger. When I read back through Deakin’s writings, I find myself thinking (perhaps naively) that if he had better understood the role that migration and trade could play in alleviating poverty, he might have been a Keatingesque internationalist. Given Deakin’s extraordinary career, sparkling writing, and strong political philosophy, it’s surprisingly easy to amputate his more illiberal views.

In the early years after Federation, it was conceivable that Deakin and his supporters might make common cause with the Labor Party. As Troy Bramston has pointed out, Deakin argued in 1903 that ‘more than half of [Labor’s] members would be Liberal Protectionists’. In 1906, he said that Labor and the Liberals were united on ‘seeking social justice’, with the only difference being that Labor wanted reform to proceed ‘faster and further’.

By contrast, Deakin regarded the Anti-Socialists and hard Conservatives as little more than wreckers brought together by their ‘attitude of denial and negation’ to progressive reform. When George Reid began to take his party down the anti-Socialist route in the 1906 election, Deakin said that his platform amounted to nothing more than a ‘necklace of negatives’ (a line that echoes down the decades, even if it was a mite exaggerated). In another speech, Deakin said the forces of conservatism were:

‘a party less easy to describe or define, because, as a rule it has no positive programme of its own, adopting instead an attitude of denial and negation. This mixed body, which may fairly be termed the party of anti-liberalism, justifies its existence, not by proposing its own solution of problems, but by politically blocking all proposals of a progressive character, and putting the brakes on those it cannot block.’

But with the conservative-liberal ‘Fusion’ in 1909, Deakin’s liberals finally made common cause with the conservatives. Much as he might have wanted to ally with the ALP, there was little appetite for such an alliance in Labor ranks. Moreover, Deakin felt uncomfortable with the tightly binding ‘pledge’ that Labor candidates were required to sign. The difference seems trivial in an era when all political parties require their parliamentary representatives to implement their party platforms.

If anyone needed proof that the scales of history could have tipped the other way, they need only have looked to UK politics after World War I, where the collapse of that country’s Liberal Party led to a surge in electoral support for British Labour. Bramston calls Fusion in Australia ‘a marriage of convenience … in order to counter and challenge the rise of Labor’.

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Since its founding in 1944, the Liberal Party of Australia has regarded itself as the rightful heir to Australian liberalism. Moving the creation of his party, Robert Menzies said ‘We took the name ‘Liberal’ because we were determined to be a progressive party, willing to make experiments, in no sense reactionary, but believing in the individual, his rights and enterprise, and rejecting the Socialist panacea.’ According to George Brandis, Menzies never once used the word ‘conservative’ to describe his party. In 1960, Friedrich Hayek wrote his famous essay ‘Why I Am Not a Conservative’. At the time, most in the Liberal Party would have agreed with him.

Yet under the leadership of John Howard, liberalism ceased to be the raison d’etre of the Liberal Party. Instead, Howard argued that the Liberal Party was the custodian of two traditions: ‘It is the custodian of the Conservative tradition in Australian politics. It is also the custodian of the progressive Liberal tradition in the Australian polity’. Howard, who had once said ‘I am the most conservative leader the Liberal Party has ever had’ – was breaking with his party’s liberal past. As George Brandis has noted: ‘Alfred Deakin, Robert Menzies, Harold Holt, John Gorton, Malcolm Fraser were all happy to describe themselves simply as liberals. Howard was the first who did not see himself, and was uncomfortable to be seen, purely in the liberal tradition.’

Tony Abbott took the Liberal Party further down the conservative road, writing in Battlelines: ‘“Liberal National” might actually be a better description of the party’s overall orientation than simply “Liberal”.’ By 2010, Abbott had watered down liberalism further still, nominating three instincts that animated the Liberal Party: ‘liberal, conservative and patriotic’. It was a special irony that Abbott chose the Deakin Lecture as the venue to declare that liberalism’s stake in the Liberal Party had been diluted from 100 percent to 33 percent.

Malcolm Turnbull was the most liberal Liberal leader since Fraser, but was ultimately unable to bring his party back towards the centre. Even the most modest steps towards a market-based approach to tackling climate change were too much for the reactionaries in his partyroom. In his place, Scott Morrison is largely defined by what he opposes rather than by what he supports. Amidst a cacophony of clichés, he seems largely untroubled by any need to set out a governing agenda. His is a deeply conservative government. As Morrison might say, ‘how good is the status quo?’.

If Howard thought he was winning the competition to be the Liberal Party’s most conservative leader, his successors have outdone him. Scott Morrison and Tony Abbott are easily more conservative than Howard, who has now slipped to bronze on the ranking of most conservative Liberal leaders. The brand of ‘just say no to change’ conservatism that has dominated the modern Liberal Party is incompatible with small-L liberalism.

What is occurring today is the undoing of the Fusion movement – the divorce of liberals and conservatives. Small-L liberals like George Brandis, Christopher Pyne and Malcolm Turnbull are out. It is little surprise that genuine liberals like John Hewson spend more time criticising than praising the party they once led. The Liberal Party of Australia is now a LINO party: Liberal In Name Only. It’s a fitting acronym. After all, Lino was Australia’s favourite floor covering… in the 1950s.

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A century on from the conservative-liberal fusion, Deakinite liberalism is back on the auction block. Increasingly, the Liberal Party is defined by what it stands against, rather than what it stands for. The spirit of progressive liberalism – described by Deakin as ‘liberal always, radical often, and reactionary never’ – is in need of a new custodian.

Labor has always contained a liberal strain – partly indebted to Chartist and Fabian traditions, but also influenced by the type of social liberalism that Deakin and his followers advocated in the later nineteenth and early twentieth centuries. This fact was not lost on astute foreign observers, such as Lenin. Australian philosopher Tim Soutphommasane argues that the social democracy of Anthony Crosland and H.C. Coombs owed more to liberalism than Marxism, summing up with the words ‘we are all liberals now, comrade’.

Throughout the twentieth century, social liberalism joined together many of Labor’s achievements. Broad-based income taxation under Curtin. A Race Discrimination Act under Whitlam. Trade liberalisation and a floating dollar under Hawke. Enterprise bargaining and native title under Keating. Removal of much of the explicit discrimination against same-sex couples under Rudd. Emissions trading and disability reform under Gillard.

At last month’s election, our platform included an Australian Republic, a national integrity commission, tax reform, competition reform, and a FutureAsia plan to engage with the region.

Whether through support for individual liberties or the belief of open markets, social liberalism has a prominent place in the story of the Australian Labor Party.

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Labor will always be the party of egalitarianism. Too much inequality can tear the social fabric, threatening to cleave us one from another. A belief in equality is deeply rooted in Australian values, and underpins policies such as progressive income taxation, means-tested social spending, and a focus on the truly disadvantaged. This marks Labor apart from many in the Coalition, who maintain that inequality does not matter, that economic outcomes have more to do with effort than luck, and that government can do little to reduce poverty.

Labor’s egalitarian roots draw on our origins as the political wing of the trade union movement. As I outlined in a speech last October, unions are a powerful force against inequality. The union movement has campaigned for equal pay for Indigenous Australians, for women, and for migrant workers. The troubling decline in union membership explains part of the rise in inequality in Australia. Laws that make it harder for unions to represent workers are likely to widen the income gap. Unionism underpins Labor’s commitment to egalitarianism.

But for those voters who see themselves as social liberals, their natural home today is also in the Labor Party. Labor holds true to the belief – grounded in the reforms of Hawke and Keating – that tax reform requires broadening the base in order to lower the rate. This year marked 20 years since the GST legislation passed the parliament, and 20 years since the Coalition were last willing to engage in serious tax reform.

Social liberalism also demands answers to Australia’s productivity crisis. Labour productivity surged under the Rudd and Gillard Governments, but has since slumped. As the Productivity Commission reported in its Productivity Bulletin last week, labour productivity growth is now below its long-run rate, and fell every year from 2015 to 2018. Spending on research and development is in the doldrums. As the Commission notes, ‘The share of businesses that are innovators — which goes beyond R&D spending — is no longer growing.’ A progressive productivity agenda requires smarter investment in education, more targeted infrastructure spending, and updating competition laws to keep ahead of multinational monopolists that threaten to crush domestic start-ups.

One of the things that I learned from my role as Labor’s competition spokesperson over the last two parliamentary terms is that the bargaining position of small businesses has a lot in common with the bargaining position of employees. Just as a fragmented workforce can be vulnerable to exploitation from a large employer, so too small businesses often find themselves facing a ‘divide and conquer’ strategy from big firms. Think of companies that sell most of their output to the large supermarket chains, family-owned automotive dealer franchises negotiating with global car manufacturers, or boutique hotels paying 30 percent to list on online booking platforms. Just as in industrial bargaining, these small businesses often find that their choice is to hang together, or hang separately. Social liberalism isn’t just about the freedom to organise; it’s also about the freedom of small businesses to work together to get a fair deal.

In social policy, Labor is committed to more rigorous policy evaluation, using approaches such as randomised trials to put theories and prejudices to the test. As US judge Learned Hand once said, ‘The spirit of liberty is the spirit which is not too sure that it is right’. This more modest approach to social policy ensures that government evaluate new ideas more rigorously: scaling up those that work, and discarding those that do not. It also turns out that this is a far better way to achieve egalitarian goals. You can’t reduce poverty with social policies that don’t work.

Internationally, social liberalism demands engagement with the world, and a recognition of the value of trade, migration and foreign investment in spurring Australia’s prosperity. For example, at a time when the World Trade Organisation’s dispute system is threatened with collapse, Australia is nowhere to be seen. Not only should we be trying to avert the crisis – Australia should be at the forefront of rebuilding the World Trade Organisation into a body that can strike good quality multi-country deals. The last all-in trade agreement was struck in 1993, and attempts to conclude another one have repeatedly failed. Yet rather than allowing the system to devolve into a ‘spaghetti bowl’ of bilateral deals, why not remake the World Trade Organisation into an organisation that is focused on helping groups of like-minded nations reduce trade barriers in a way that boosts rather than diverts trade?

A commitment to social liberalism also reflects Labor’s commitment to an open, multicultural and multi-faith Australia. Listening to the first speeches of Labor members, I sometimes wonder what my party’s founders would have made of the paeans to multiculturalism and migration that are common to almost all Labor maiden speeches in recent years. Many of Labor’s founders regarded Asia’s peoples as the biggest threat to their living standards. By contrast, social liberalism recognises that Australia benefits from immigration (including circular migration). It acknowledges that national growth isn’t like the Olympic medal tally: prosperity in China, India and Indonesia will boost Australian living standards too. And it recognises the importance of honouring people of different faiths, as well as those of no faith.

Finally, a commitment to social liberalism requires that Labor be the party of civil liberties. Does everyone remember the February raids that followed the Morrison Government’s leaking of a classified briefing document on the medevac bill to The Australian? No? Perhaps that’s because they didn’t happen, despite the briefing drawing on ASIO advice.

Yet when documents are leaked that embarrass the Coalition, they are willing to turn over a journalist’s kitchen, and raid the ABC with a warrant that allows the collection – and deletion – of key files. The stories in question related to allegations of unlawful killings by Australian special forces, and apparent considerations of giving government agencies greater powers to spy on Australians. Both are clearly in the public interest. The New York Times’ report of the raids was headlined, ‘Australia May Well Be the World’s Most Secretive Democracy’. In ensuring that security concerns do not ride roughshod over fundamental liberties, it’s time to revisit John Faulkner’s proposal to toughen parliamentary scrutiny of our intelligence agencies.

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There is a lot of luck in politics. But for a few hundred votes, both Gough Whitlam and John Howard would have ended up in state politics rather than on the national stage. Assassinations, weather on election day, and turmoil in the global economy all shape politics for better or for worse.

When it comes to Labor and social liberalism, one of the unlikely factors may have been the electoral contest that took place in the seat of Ballaarat in the 1906 federal election. Labor’s James Scullin, an unknown grocer who would go on to become the nation’s ninth Prime Minister, challenged the sitting Prime Minister, Alfred Deakin. As Liam Byrne observed in the Australian Journal of Politics and History, the contest acted out the emerging breach between Labor and the Deakinite social liberals. ‘The ALP was no longer conceptualising itself as a radical usurper, nor as the tail that would wag the liberal dog. Instead, it was a potential government with its own distinctive vision for Australian democracy.’ From the other side ‘it became clear to Deakin that Labor would have little left to gain from the liberals, with an anti-Labor combination the most likely outcome’. The Ballaarat contest of 1906 was not the only factor that led to the breach, but it certainly didn’t help matters.

A century on, social liberals have been cast out from the Liberal Party of Australia. Today’s Liberal Party is different from the party Menzies founded. It is now the creature of John Howard, and his intellectual heir Scott Morrison. It is, in essence, a party of ‘capital-C conservatism’. And that leaves social liberalism free for just one party: the ALP. Labor is the natural home not just of egalitarians, but of social liberals too.

ENDS

Authorised by Noah Carroll ALP Canberra.

* This speech draws on some of my previous writings, including a speech to Per Capita and an article for the Global Mail.