Howard behind in polls and issues for 2001 campaign

There are other subgroups that need to be considered and which are impossible to pull out of broad-brush polling like this. One of those groups is those alienated Anglo-Irish lower-income earners in fringe urban and rural seats who lodged a protest at the last election by voting for One Nation. Much commentary treats this group as a bloc that will go entirely to one party or the other. In fact, they offer only marginal advantage to either party, splitting 50/50 in the last Federal election. Those splits are unevenly spread, so their votes become most important in individual seats.

The interaction of these demographics with the issues means that some issues that appear relatively unimportant can be quite important in particular seats. Immigration and Indigenous issues will read differently in marginals like Longman or Hinkler both in strong One Nation territory, and could be decisive. Likewise, while women 25 to 49 rate social issues highly, many also have family budgets to balance. Higher home mortgage rates will quickly alter their perceptions of what is important.

The Liberal Party needs to elevate the economic issues in importance and minimise the social issues. It also needs to strengthen its position on the social issues, and establish a clear perception that social goals are the return from wise economic management. To do this the party cannot afford to rely on its economic record. It will not be rewarded for past performance alone. Policies will have to be invented, and at this stage, there are few hints as to what they will be.

In this respect the party has a problem on the economic issues. While, for example, it is seen as being the best to deal with taxation, most of its tax reform is behind it. And the electorate regards that reform ambivalently. More Australians say they are worse off as a result of the GST according to a Morgan Gallup Poll of 2/3September, 2000. The group most inclined to this view is One Nation voters. The Ralph tax reforms do not offer much leverage either, as they introduce a further level of uncertainty, and are at best controversial.

Peter Costello seemed to be signalling interest rates as a part of the strategy when he said in New York that surpluses would be saved, not spent. Tight fiscal policy equals lower interest rates. If voters can be convinced that a big-spending Labor Government would increase their mortgage repayments, that gives the government an advantage.

It is traditional for the Liberal Party to pitch its election campaigns at tax cuts. Undoubtedly it will do this again, despite John Howard’s reported comments of the 1st November that there would be no large tax cuts. But any surplus it has available to it is also available to the Labor Party, so this will not necessarily get it very far.

The government was relying on the sale of the balance of Telstra to pay back the deficits and nullify the Labor Party's ability to match it on tax cuts. This is now unlikely to happen. Just as well. With the price of Telstra 2 installment receipts well below their issue price, there is not a big market for T3.

New economic policies are problematic. The only economic reforms still to be achieved are not popular with the electorate. However, some social issues provide some possibilities. David Kemp has staked out interesting territory with the funding of private schools. His changes are designed to encourage the establishment of new private schools and should be a boon to the Catholic parish school sector – identified first by the Karmel report in the ‘70s as the most underprivileged of all. If the issue can be dragged away from the examples of rich schools getting richer, this provides some traction in the area. The government should also be looking at something to do with national standards. It can’t compete in the public mind with the ALP when it comes to spending on education, but it has always had a good reputation in regard to the three Rs.

Private health insurance provides a lever for Health. Labor is in the difficult position of opposing the Government’s rebate for private health premiums. We have all been educated, courtesy of very effective health fund campaigns, to believe that public hospitals equal long queues and inferior treatment. As a result health insurance is regarded by large sections of the electorate as very close to a necessity. Any threat to make it more expensive will again play badly to mothers with children, and seniors, and the health funds would be delinquent in their duty to their shareholders if they didn't run advertisements in the election period pointing this out.

Welfare and social issues also provide the Liberals with opportunities. Electors like the concept of work for the dole. They also like the concept of mutuality embodied in documents like the McClure Report.

The rise in petrol prices has given the Government an opportunity to recast the environmental debate into "brown" rather than "green" issues, which should reinforce its initiatives on dry land salinity. While it will never win the green fight, it can substantially nullify it as an issue and force the debate down paths less malign to it.

Indigenous affairs also deserves some analysis. Many activists have come to the conclusion that reconciliation in particular is an issue with which to berate the government. This is a mistake. John Howard is not a racist, yet some of the misconceptions being pushed about Howard actually help his vote with potential One Nation voters. The ALP has long had a position on indigenous affairs that collects them votes in Sydney and Melbourne and loses them votes almost everywhere else. Liberal strategists must be praying that Sir Ronald Wilson will get his Reconciliation Party up.