Plenty of room for Rudd's souffle

Galaxy's latest poll, which either shows we are all on Mars or David Briggs' outfit is polling the Andromeda system, provides just a dribble of sustenance for those Liberals bravely clinging to the-historic-16-seat margin argument as a reason why Labor will not win.

It is true that 16 seats is a very large buffer to make up. But it is by no means unprecedented. Labor oppositions have traditionally come off shockingly low bases, hence they have needed two steps to get close enough to win power. Whitlam won 18 seats in 1969 with a 7% swing. Hayden, while winning only 13 seats in 1980, did so from an appalling position. He received a 4.2% swing, mainly from minor party voters swinging behind him.

Hayden's result would give Rudd a statistical tie - 51.5 to 48.5 is the exact point on the pendulum where there is no clear majority. Whitlam's result gives Labor a 54.4to 45.6 win - in short a landslide. This is also almost exactly the current average of the four major polls.

History shows that when the opposition gets an insufficient swing to govern, the average swing since 1949 is 2.25%. That swing would give Labor 49.6%. Clearly, this is not your average election. Rudd's standing and perceived competence is daylight compared to Latham and he is on track to at least pinch votes from the Liberals. A conservative estimate would be a swing of 4.5% - and even that includes 1.8% for the anti-Latham swing, 2.25% for the average swing and only 0.5% for other factors.

Latham's result in 2004 was appalling. Labor achieved just 37.6% on primaries. Interestingly, because of the post-modern third party politics era, that awful primary left Labor at 47.3% of the two-party preferred vote. The Liberal-National vote cannot go much higher than its 2004 position. Labor can thus move from a terrible position to a very good position with a relatively small change in primaries.

The minimum primary vote swing from the polls is 4.4% (Galaxy) ranging up to 10.4% (AC Nielsen). Using the unscientific approach of avergaing these results gives a 7.4% swing - i.e. 45% on primaries. That is in line with a 1969-style swing.

Both in polling and qualitative terms, this election's trend looks more like 1969 than 1980. Rudd is not taking votes solely from minor parties - in fact he may be losing some of them back to the Greens. We know that 35% of unionists voted for Howard last time - bet they will not do that after being labelled thugs. We also know that there is a big swing among mortgage holders who may well switch straight from one major to another. This points to Labor gaining the majority of its new votes from the Liberal-Nationals and putting it in the box seat to take advantage of Green preferences to win marginal and safe seats alike.

On this basis, I predict that Labor will get around 45% of the primary vote, the Liberal-Nationals around 40.5% and the Greens around 9%. Labor to win 54.7-45.3% on two-party preferred around 90 seats.

Will 'Lindsay-gate' be gold for Labor in Goldstein?

Andrew Robb, Liberal Minister for Mudslinging, appears to be suffering from a political case of papal infallibility. Not content with making unsubstantiated allegations that twelve Labor candidates has not properly resigned from their 'offices of profit under the Crown', he has now attempted to bury the disgusting leaflet distributed by Liberal party operatives in Lindsay.

Robb has point blank refused to withdraw or apologise for his earlier allegations, which even the Herald Sun were a 'glitch' to the campaign. In fact, he even repeatedly demanded Penny Wong, Labor's campaign spokesperson, apologise for stating the widely reported suggestion that a member of the NSW Liberal executive was involved in the leaflet scandal. He does not seem to realise that his seat of Goldstein is mentioned in numerous dispatches as one reliant on true liberals maintaining their allegiance to his party. Even with a margin of 10.1% he is not safe. Just ask Joe Hockey and Michael Johnson.

If the false allegations which eleven of the candidates promptly refuted were not bad enough, Robb has two scandals to contend with. Both of them try to make political currency out of the Bali bombing.

In the Melbourne seat of La Trobe, the high profile Labor candidate, Rodney Cocks won the Medal of Conspicious Honour for acts in the aftermath of the Bali bombing. Anonymous Liberal sources contacted The Age to offer 'discrepancies' between Cocks' account and a journalist's report on his actions.

The extraordinarily inflammatory pamphlet distributed in Lindsay thanked Labor for supporting clemency for the Bali bombers. The lame defences of retiring MP, Jackie Kelly, suggest she either has an extremely nasty sense of humour or other intentions. Somehow I do not think that the Bali bombing is a source of humour.

It is blatantly obvious to anyone viewing the demographics and politics of Western/Southern Sydney seats such as Lindsay, Macarthur, Greenway, Banks and Hughes that they have low proportions of non-English speaking residents, high proportions of identified Christians, high votes for One Nation and swung higher than average behind Howard in 1996 and 2001. It is also known that there is currently a considerable controversy surrounding a proposed Islamic school in Camden. The area is under one of the highest levels of mortgage stress in the country and polling puts Lindsay as a lost Liberal cause and Macarthur and Greenway in Labor's sights.

It does not take Einstein to make the correlation that pushing an anti-Islamic barrow might be worth a few votes for a desperate government. After all, the loss of seats like Macarthur and Greenway would be a total repudiation of Howard's economic program and undermine the fostering of religious and cultural intolerance.

With the news that the Labor candidate for Dobell, Craig Thomson, is now being accused of being of bad character because of evidence he gave in an industrial hearing a decade ago, it seems that Robb is leading a counter-offensive, seeking to knock Labor's national issue-based campaign off-balance by putting local candidates on the defensive on dubious character grounds.

The question is whether any of the tarnishing of Labor candidates in marginal seats will be offset by a true liberal backlash of Robb's mendacious behaviour. Will he become the poster boy for sleazy attacks in the same way Joe Hockey is paying as the face of workchoices?

King Canute and the Lucky Country

Our language is peppered with unique phrases harking back to other times. Fossilised imprints of ideas remain in the collective mind long after the actual knowledge they represent has died away. Often the intent of the phrase is ironic. Language is a subtle creature where the merest tilt of a word can provide sufficient wiggle room to squirm out of most predicaments.

The caretaker (or possibly undertaker PM judging by the tenor of the anti-union scare campaign) PM has attained the status of a Jedi knight for his use of lexiconic gymnastics. As a tribute to this virtuosity, I offer two such allusions which demonstrate the fragile nature of meaning: King Canute and the Lucky Country.

King Canute was a Danish king of England during the 11th century. He is best remembered for attempting to hold back the tide. The tide was not so obliging. A Canute in common parlance is one who resists the bleeding obvious to no avail, possibly involving a spectacularly conceited act of hubris. Only it does not really mean that at all. The whole point of Canute's placing his throne on the beach was to demonstrate to his sycophantic courtiers that there were limits to the king's power. The real cautionary tale is lost by losing the edge of meaning. It is a lesson that rulers of whatever colour forget at their peril. This is clearly the case with the aforementioned PM's contemptous treatment of workchoices and climate change.

The expression 'the lucky country' was popularised after the historian Donald Horne's book of the same name was released in the 1960s. Horne warned that an Australia blessed with agricultural riches should not be complacent and rely on utopian (or perhaps for Kevin Rudd, brutopian) abundance. The warning tone of the message seems to go missing at times, the title seen as a note of thanks or an observation that 'she'll be right' on a national level.

The current context of the 'lucky country' phrase relates to economic prosperity, particularly in relation to securing the future post the China/India boom. The binary opposite popularised in the 1980s was that Australia should become the clever country, an idea that seems to have collapsed on the Howard watch. Clearly a student of Horne's true meaning would advocate upskilling our students to function in an information economy and have a forward planning approach to issues such as climate change.

When next you hear one of those obscure allusions like Canute and his penchant for paddling consider the true meaning behind the easy phrase. It will surely be more enlightening than listening to 'working families' and 'union bosses' repeated five hundred times.

The Gore Election

Al Gore may have seemed something of a historical curiosity to most Australians when he was in power. As Vice-President, he did not seem particularly remarkable beside the charismatic Clinton. He achieved minor notoriety for allegedly claiming to have 'invented the internet'. At that stage, it seemed far fetched he may play a defining role in an Australian election.

The first stanza of Gore's influence is now fairly well-known. Gore's Oscar/Noble Prize winning An Inconvenient Truth, not so much polemic as persuasive pleading, crystallised the mist of concern Australians have long felt on climate change. Suddenly the issue became mainstream and Howard's economic colossus was left stuck with feet of clay. There is a major revolt on from true liberal voters, so much so that Howard is launching all manner of warnings of the 'red-green menace'. Undoubtedly, Gore played a key role in turning climate change into a mainstream issue.

What has previously not been apparent is the relevance of the flipslide of Gore's career. The reason Gore got the time to pursue climate change is because he lost the 2000 election to Bush in highly controversial circumstances. The Florida outcome came about because of the closeness of the election.

If one reviews the polls here, at first glance it looks like a rout. Look closely and Labor's vote is staggered, ever so neatly to give it enough seats to construct a decent majority. Seats like Bennelong (margin 4.5%), Robertson (6.9%) and Leichhardt (11.1%) could all conceivably fall to Labor by about one percent. The closeness of these contests creates a question of legitimacy, and if legal grounds can be found to challenge that election, Liberals playing from the Republican playbook are sure to find them. In the regard, the conservatives best friend is section 44 of the Constitution.

Under section 44(iv) no person occupying 'an office of profit under the Crown' can nominate for election. The key time is the time of nomination. The only problem is precisely what that means.

We have already seen this with the furore over George Newhouse's slipshod nomination in Wentworth. According to the Herald Sun, 13 other Labor candidates may be ineligible. This begs two questions: firstly, assuming it is correct, why are so many candidates so bad at crucial paperwork and secondly is the Liberal party planning to go quietly into the night or quietly into the Court of Disputed Returns. I find it highly unlikely that these Labor candidates did not resign from their positions or that they held them without seeking legal advice on the nomination requirements.

It beggars belief that so many candidates, at least seven of whom are in very tightly contested seats, could have made invalid nominations. The Parliamentary Library has expressed concern that using these provisions in an 'unduly technical manner' leads to costly by-elections which only return the original winner.

Either this does not bode well for the propriety of Labor MPs or it does not suggest the Liberal party will be overly keen to accept the umpire's verdict.

Either way, Al Gore and the two heads of his political career may have a big bearing on the outcome of the election.

The real election contest

Kevin Rudd's Labor juggernaut has all but dispatched John Howard's spluttering Liberal machine (with unhinged National caboose) to the annals of history. However, Rudd's success is not total. The same political shift to the right that has facilitated Rudd's centralisation of Labor has opened up a new contest: with the Greens. Whereas Rudd has been fighting his battles on the right flank, neutralising Howard's wedges and attempts to posit him as economically irresponsible, the Greens have been agitating to be both the true believers on climate change and the 'third party insurance' in the Senate.

Labor lost a large number of disgruntled voters to the Greens at the last election, mainly disenchanted with the parties' incompetence as much as environmental policy. Under Beazley Mark II, Greens preferences elevated a pretty ordinary 40% primary vote to a stratospheric two party-preferred lead. Rudd's ascension consolidated Green defectors into Labor's primary vote. The Greens suddenly found an electorate focussed on water and climate change issues poised to turn away from it. On a micro level, this perplexed position may have given them something in common with Liberals facing annihilation in 2001.

The Tasmanian pulp mill - and specifically Garrett's forced acquiescence - is akin to the Tampa boarding for the Labor/Green dynamic. It focussed attention back on a physical environmental issue rather than the perception of Labor's competence. Just as in 2001 when children overboard reventilated the Liberals' Tampa show of strength, Rudd's perceived repudiation of Garrett's 'sign-first-and-ask-questions-later' approach on climate change solidified concerns on the Labor/Green faultline and caused Labor's credibility on environmental issues to fall.

The result is starting to show up in marginal seat polling. In Tasmanian seats, the pulp mill issue is felt most keenly. The seat of Bass has turned from Labor winning on primaries to heavily reliant on Green preferences. However, the real key may be on the mainland. Climate change is consistently rated among the top issues with Liberal voters, particularly in seats with a high proportion of 'tree/sea changers' such as Eden Monaro, Corangamite and Richmond. Seats such as North Sydney, Wentworth, Ryan, Sturt and Stirling have a high number of true liberals flirting with crossing the line to Labor.

It has been assumed that these voters are frightened to move across the 'Green barrier' on economic grounds. This may be the case, but the primary source of their disillusionment is inaction by Howard on climate change. If Rudd is seen as not a lot better, then it is possible that Liberal voters may go halfway and vote Green but preference their local Liberal. This probably won't affect the result: Howard's stocks with the 'battlers' are at an all-time low. However it might turn a potential annihilation into a close defeat. A primary swing of 4% from Labor to Green will cost Labor 1.2% of their margin in each seat, and in seats with big margins to make up that may be the difference between winning and losing.

In any case, a government elected heavily on the back of Green preferences will have to take serious notice of Green policy proposals across the board.

Market failure: Wood demonstrates inadequacies of economy-based approach to climate change

The Australian's Economics editor, Alan Wood, is a champion of the free market. His latest article targets the issue of clean energy targets and how they contradict the philosophy of an emissions trading market. In the process, he demonstrates precisely why a market approach to alleviating climate change will not work if its sole ally is economic principle.

He first makes the common mistake of eliding Howard's clean energy and Rudd's renewable energy targets. Clean energy encompasses clean coal and nuclear. As Guy Pearse has demonstrated, the locked in funding for coal companies means that the entire Howard clean energy target is subscribed to clean coal. This mistake is equivalent to allowing cordial as a substitute for fresh fruit.

Wood then makes the claim that the chances of meeting Rudd's target of 20% renewable energy by 2020 without 'massive taxpayer subsidies or a technological miracle' are negligible. The current market share for renewables is a tick over 9%, mainly contributed by hydro. In reality, the required scale-up is then 11% over 13 years. My understanding of Rudd's definition incoporates natural gas, which could feasibly be scaled up to provide equivalent baseload power in the required time. That aside, I will assume that on face value emissions-laden coal power is significantly cheaper than renewables.

The key phrase being at face value. Wood's analysis assumes that coal operates without subsidies from government as compared to renewables. Greenpeace estimated that the average annual subsidy to coal, oil and gas companies is $9 billion, whereas renewables receive $330 million. Industry Minister Ian Macfarlane justified this state of affairs on the principle of proportional representation, saying that renewables did very well for the share of power they produced.

Wood's premise is that the coupling of emissions trading schemes with renewable targets amounts to triple taxation of energy consumers, paying first for the cost of carbon through trading, then through higher renewable energy costs and finally being hit by having their income tax spent subsidising the renewables. Renewable energy targets pick winners which is by definition undesirable.

First, an emissions trading scheme adjusts the price of carbon. Renewables produce lessening levels of carbon and hence become more competitive in such a scheme. Secondly, as renewable market share increases, the cost of production decreases for consumers. Thirdly, if the true subsidy position is considered, taxpayers get a much better deal from renewables with future potential compared to a coal industry which will inevitably contract. If anything, propping up an industry by reducing competition and innovation is uneconomic and ultimately counterproductive.

Wood then has two further objections to the policy framework. He questions the efficacy of emissions trading altogether and then, telling, suggests that haste is not desirable as emissions can be stabilised at 650-700 parts per million. He may well have a point on emissions trading, which is susceptible to problems such as an inconsistent or inappropriate carbon price and integrity in monitoring emissions.

However, the 650-700 ppm is a dangerous theory which smacks of an unawareness of his material. Although past emission records are imperfect, current carbon levels exceed those of any of the interglacial periods during the most recent geological era. The IPCC has estimated that they exceed anything seen since prior to the most recent pattern of Ice Ages (20 million years ago). Nobody is quite sure when the carbon levels were last at 650-700 ppm, but the dinosaurs might have done fairly nicely in those conditions and they were cold blooded.

The argument that abatement will cost 'trillions of dollars' fails to recognise the level of subsidies given to fossil fuels and the ability of renewable energies to do a lot when given a bit of support by governments. It merely takes government allocation of trading permits, calculates their monetary value and adds them together, then factors increased fossil fuel prices across the economy. In other words, it misinterprets the starting baseline, leaves out the benefits, manufactures negatives and then extrapolates them unreasonably.

It is bad science dressed up as bad economics. The market does not have all the answers, but it at least needs to have all the information at its disposal to work properly.

The gap between self image and reality

John Howard was quite willing to stand before his entranced party on Monday and proclaim 'love me or loath me, the Australian people know what I stand for'. In light of this, I checked out the Liberal party's website for what the party publicly states it stands for. The website cites eight core beliefs which define Liberal party values:

1. We believe in the inalienable rights and freedoms of all peoples; and we work towards a lean government that minimises interference in our daily lives; and maximises individual and private sector initiative.

* Except we don't recognise the rights of Aboriginal people to self-determination which is why we abolished ATSIC and latterly the permit system and consistently attacked High Court decisions (Mabo and Wik) on native title.

* Except we have introduced the most draconian legislation to control payments to the unemployed, including single mothers and the disabled, where failure to perform fifteen hours of work a week can lead to losing payments for eight weeks.

2. We believe in government that nurtures and encourages its citizens through incentive, rather than putting limits on people through the punishing disincentives of burdensome taxes and the stifling structures of Labor's corporate state and bureaucratic red tape.

* Which is why we introduced the GST and Workchoices, two of the most hideous complicated legislative programmes in history. Not content with that we introduced the ad hoc fairness test with no guidelines as to what constituted 'fair compensation' for lost conditions.

* Into the bargain, we turned remote NT shopkeepers into micro-accountants, quarantining support payments based on printouts sent from Canberra.

3. We believe in those most basic freedoms of parliamentary democracy - the freedom of thought, worship, speech and association.

* Which is why we accept donations from the Exclusive Brethren which was implicated in interference in the NZ election, forcing the resignation of the opposition leader.

* Which is why large sections of the party actively discourage involvement by people from non-European backgrounds or anyone who has views contrary to those of the so-called Christian right.

* Which is why we are trying to destroy the remainder of the union movement by making it almost impossible for union organisers to visit workplaces and involvement akin to social death.

4. We believe in a just and humane society in which the importance of the family and the role of law and justice is maintained.

* Tell that to Izhar Ul Haque.

* As long as you are not actually suspected of either being involved in anything remotely close to terrorism or being disorientated from a non-Anglo Saxon background (Cornelia Rau or Vivian Solon).

* Families are so important we made it easy for workers to lose their penalty rates so they didn't have to be together on weekends.

5. We believe in equal opportunity for all Australians; and the encouragement and facilitation of wealth so that all may enjoy the highest possible standards of living, health, education and social justice.

* But if you did not have equal opportunity to start with, bad luck. University education should be confined to those who will use it responsibly and not flirt with radical ideas like postmodernism.

* Education should be about the 'three rs'. Nothing else, and Australian history.

* We really believe that the highest possible standard of living involves buying lots of stuff whether you can afford it or not.

* We believe everyone should get the best health care so long as it's private and the drug companies get a fair go at getting their R&D budget back.

6. We believe that, wherever possible, government should not compete with an efficient private sector; and that businesses and individuals - not government - are the true creators of wealth and employment.

* We really believe that there is no such thing as an inefficient private sector. All private sectors are by defintion efficient. Some just need support against public sectors.

7. We believe in preserving Australia's natural beauty and the environment for future generations.

* We like whales but we don't really think the environment is that important compared to the economy.

* We don't think climate change is a problem, but if it is, little old us can't do anything anyway. Windmills kill birds. If we need to protect the Barrier Reef, we will cover it in shadecloth.

8. We believe that our nation has a constructive role to play in maintaining world peace and democracy through alliance with other free nations.

* Except through anything that looks like the United Nations. National interest is the only way to go and we can only do that through other forums.

Bigger crash than Ben Hur?

The faux Roman epic Ben Hur is famous for two key reasons. For both its spectacular length (in some quarters tedium) and its extremely nasty chariot race where most of the contenders get disposed of by a variety of means unknown to the Marquis of Queensbury. In fact, its shares much in common with the Coalition's election campaign.

The entire enterprise appears to be a barely disguised mirage rather reminiscent of the Bank of Queensland commercial where no sooner have a young couple signed their home loan papers than the desk, walls and personnel of the bank evaporate into dust. The message presented to voters, the campaign organisation and the visual presentation of the ads themselves borders on shambolic.

Rather than demonstrate any convincing alternative policy, Howard's launch chose to augment funding for Rudd's policies. This must surely have killed the 'me-too/ vision' debate where he was finally getting a hint of traction. Somewhere between Howard's 'go for growth' slogan and the wish to have an 'opportunity society', Howard's agenda-setting mojo failed to make its customary appearance.

However, today's newfound embrace of bipartisanship poker is only the latest episode where Howard and his campaign staff have failed to take a trick. Basic issues such as getting Tony Abbott to the church (or even the National Press Club) on time appear to be secondary to finding new and unusual ways of alluding to trade unions.

On policy, the obvious weakness is Howard having no clear plan for the future. The whole point is that Howard only had one plan he ever told the voters about in 1998, then surreptitiously introduced everything after he gained re-election based on Labor's perceived incompetence. Howard failed to realise that Rudd steadfastly refused to be wedged and did not adapt. Despite early attempts to turn climate change into an economic issue, Howard had no idea how to. A lame duck to the even lamer Costello.

The slogan 'go for growth' was absurd in the face of a workchoices mutiny and rising interest rates. Even the ads themselves are incompetent. The attack ads linking federal and state Labor go through the union hoop thus diluting their message. For some bizarre reason the Liberals are running the word 'grow' in italics. To paraphrase a Labor ad, people want a 'better' life, Mr Howard. They do not necessary care about nebulous ideas of 'growth'. Not only does this look painful, it reinforces the feeling of resentment those not sharing in the boom are feeling.

The most incompetent use of text in an ad must be the banners inserted into Howard's presentation on the ABC. Liberal party staff must have thought it would be great to emphasise Howard's key themes in the fashion of Sky News. Only someone forgot to tell them that the ad was broadcast in Widescreen format and most people still have ordinary analogue TVs. If anyone in plasma land was even watching Howard on the ABC at 9:30pm on a Saturday night, they would have got the old spiel about unions and states being the sources of all ills. What the plasmaless people for whom Howard has developed a tin ear saw was how 'ions' would ruin the economy and that 'ate' are to blame for interest rates.

Well, perhaps if we did pursue nuclear power and relied on fate to get us home, we would have economic and interest rate problems.

Blank cheque mandate gives away to credit election

Nick Minchin's claim that 'our workplace relations policy last time set out the goals for the current laws' is partially correct. Technically speaking, the Liberals have long advocated removing unfair dismissal laws and constructing the labour market system around AWAs. However, the key question is the degree to which those reforms were impressed upon the Australian public.

The big change on unfair dismissal was the scope to which Howard's exemption applied. The Democrats had beaten back forty-one attempts to introduce laws abolishing unfair dismissal claims for small business between 1996 and 2006. However, the figures presented to the Democrats limited this exception to ten employees. Workchoices applies the exemption to all business employing less than a hundred people.

The key change on AWAs was the removal of the no disadvantage test. Prior to 2006, all AWAs had to meet a no disadvantage test. This test meant the employee did not suffer a disadvantage in comparison with the relevant award. In announcing the abolition of the test, the Coalition described it as 'absurd' and 'ridiculously complex'. The pale attempt to diffuse the furore these changes provoked, the so-called 'Fairness Test', merely provided for employees to receive compensation for lost conditions including leave and penalty rates. The catch was that this compensation need not be monetary and had to be determined on a case by case basis.

This arrogant view that the electorate granted the Coalition has aroused concern that governments not be given such arbitrary power in future. This is demonstrated by polls suggesting the Greens are getting traction as the party to hold the balance of power in the Senate. Rudd's approval rating seems to not be giving him the type of blank cheque voters offered a Coalition government running on 'keeping interest rates low' and border security. It is a loan that he has taken out on promises of taking concrete action on climate change, restoring the position of employees in the labour market, fixing the health system and improving the position of 'working families' on housing affordability, rents, grocery and petrol prices and child care.

The big question will Rudd have the political capital to pay up when the voters collect their debts.

Ignoring the lessons of Bill and Bertie

The latest descent into the gutter attributed to the Liberal party 'dirt unit' demonstrates yet again the spectacular stupidity of launching personal attacks on the character of politicians. The allegation that Julia Gillard was somehow involved in some kind of union fraud exercise are no more likely to garner voter support than 'Strippergate' or any other pile of dirt. Whoever is pedalling this and Strippergate has clearly failed to understand that recent character accusations have created public sympathy for the accused and been counterproductive for the accusors. In short, they have not learnt the lessons of Bill and Bertie.

Bill Clinton and Bertie Ahern come from opposite sides of politics. One was US President and as most of the known universe knows was subject to the most tawdry investigation in political history owing to his penchant for a certain intern. After initally denying the whole affair, Clinton admitted involvement with Monica Leewinsky then ran a technical argument over the issue of 'relations'. The net result was that Clinton received public sympathy. It was however, very useful in galvanising the Republican vote at the following election.

Bertie Ahern is the Irish PM who seems to have been involved in everything from signing blank cheques for his party leader to rather shady dealings with wealthy businessmen. Ahern was confronted with evidence of donations he had received and apologised to the parliament and repaid monies. When the opposition Fine Gael party tried to make capital out of the situation, the opinion polls showed a rise in Ahern's support earning a lecture from the Irish media. The dodgy dealings of the so-called Teflon Taoiseach were immaterial to the election outcome, if anything garnering public sympathy for the embattled leader who subsequently won the election.

It should by now be clear that unless an accusation comes with hard evidence of gross misfeasance by a public official, it is likely to backfire on the accusor. Enter Kevin Rudd and Strippergate. Rudd's wonkish image was feared in some quarters to be off-putting to the electorate, but when details of his inadvertent strip club visit became known, plus his public apology, the result was a surge in popularity.

Apart from effectively conceding that Rudd is untouchable by not concentrating their policy attacks on him, the attack on Gillard is extraordinarily stupid as there are valid policy reasons which should engender concern among some conservative voters. Gillard was intimately associated with Latham's uncosted Medicare Gold policy. This big ticket item seems to have been erased from the collective political memory. Couple that with her membership of the Left faction (which unofficially makes her ineligble to be Treasurer) and there is sufficient ground to instil doubt in voters.

Instead we have the bizarre strategy of treating her like some kind of Antipodean Hillary Clinton, complete with murky dealings during her legal career. I suspect Labor is quite happy to see her image as the Australian Boudicea, standing up to the evil empire of muck-raking journalists and unreconstructed misogynists such as Bill Heffernan get further support from such unfounded allegations.

Politics of 'smear and fear' may have some utility to galvanise one's (extremist) base, but they are unlikely to endear the accusor to the public at large. Unless someone does have some evidence that compelling ties an official to a heinous crime, then in the current climate they would be best advised to concentrate on policy.

Something does not add up

A quick perusal of the Newspoll marginal seat figures offers a beacon of hope for the Liberals. At first glance, it appears that the Ruddslide is making a mess of the Nationals vote while their city cousins are holding up.

Newspoll's survey covers the seats of Dobell, Bennelong, Eden Monaro, Lindsay, Parramatta and Wentworth. The average Liberal primary vote in these seats was 47%, while the average Labor vote was 34.8%. Newspoll has the current Liberal 6 seat average at 46%, a swing of precisely nothing, while Labor is at 47%, or around 12%. The upshot of this poll is that all the voters in the 'other category' have turned around and given their primary vote to the Libs during the campaign.

One would expect a high primary vote in Bennelong, given it is the Prime Minister's seat. Even if you buy this argument, one must assume Labor will pick up several percent off the Libs in Eden Monaro (swing seat), Parramatta (a Sydney version of seats like Adelaide and Brisbane showing big Labor swings) and Lindsay in Western Sydney (retiring MP, mortgage stress). I cannot believe that Labor's primary vote is 47% in Wentworth as this is a traditionally conservative seat with a multitude of candidates running on 'Turnbull Minister against the environment'.

I equally cannot believe the corollary of this, that Malcolm of Wentworth has picked up almost all of the (12%) of King defectors and lost none to either the Ruddslide or the bevy of environmental campaigners. An outside possibility is the seat of Dobell is holding something close to the 2004 result on the back of the retiree vote, but that would suggest that Central Coast voters are not under housing stress which is quite simply wrong. I suspect Dobell may end up with a line ball result, which means that the Liberal primary is probably 2-3% less than 2004, similar to the figures in Bennelong.

I suspect that Newspoll is underestimating both the others' vote (i.e. independents) and Green vote in these seats, particularly in Wentworth and Eden Monaro. This also points to an overestimate of the Liberal primary vote 1.5-2% and the Labor vote being exaggerated by 2.5-3%...which sounds remarkably like Galaxy's polling but for the Liberal primary vote.

From this analysis, I would put Lindsay, Parramatta, Eden Monaro in the definite gain category, Bennelong a line ball contest with Labor favoured and Wentworth coming down to preference flows, particularly from climate change candidates, leaning towards Turnbull. Dobell could go either way, although I suspect the figures may have been inflated by the proximity to Howard's grey vote seeking largesse.

Formula one economy driven by reckless P plater

I suspect that the Reserve Bank must be getting ever so slightly sick of warning the Coalition government to listen to its warnings regarding inflation. Lo and behold, John Howard admitted in the face of the imminent rise:

"If you have a strong economy, you have high world oil prices and you have a drought - some inflation in the system is unavoidable,"

Costello has been telling anyone who listens that he is fiscally responsible in holding a surplus of 1% of GDP as a check on inflation. Perhaps this would be sufficient in a textbook ideal economic climate. Clearly an oil price of $90+ a barrell with an export sector weighed down by an agricultural depression and a high exchange rate does not fit this scenario. One would expect the 'greatest Treasurer in Australia's history' to do something different. But Costello sails merrily along, sitting on the Treasury benches doing...well, not much other than glorified administration.

According to the ABS, the main causes of inflation pressure are vegetable prices, housing and rents. The exponential oil price has not yet fed through, but is sure to put up the price of almost everything. Given the peak oil predictions, a prudent economic manager would be planning for the future, managing a carbon transition program so that oil dependence would be scaled back progressively and reducing our exposure to oil shocks.

On housing, rent and associated costs such as insurance, the Coalition's steadfast refusal to acknowledge the problem has created an inflationary cycle. Rates rise to slow inflation, which causes rents to go up to cover the rate rise. Meanwhile homeowners cannot afford a mortgage, so demand goes up pushing rents up.

If the IPCC climate predictions eventuate, Australian food prices will be permanently higher. This means that some serious planning has to occur to manage those price increases keeping both rural suppliers viable and urban consumers able to afford quality produce.

The main way that the impact of higher oil prices on inflation could be reduced is to encourage rail as a means to transport goods. Either this or greater use of biofuels or gas must be considered.

A major inflationary pressure is the capacity constraints on the economy. Simply put there is insufficient infrastructure (a product of Labor governments terrified of running deficits and Coalition disinterest) to maximise production through major ports such as Newcastle. A further pressure is the skills crisis, particularly in trades, causing wage pressure for those tradesmen.

Australia's economy does behave in some respects like a Formula One vehicle, growing at an average 3.6% a year for the past sixteen years. However, the government's continued insistence on spending money on a cynical basis without a wholisitic long term plan amounts to economic recklessness. It is notable that when Costello produced the Intergenerational Report plotting the challenges of the next 30 years, the main priority was the tax base adjusting for an aging population. There was barely a mention of the need to take any measures to alleviate climate change.

Who do you trust to keep these rates under control?

In the midst of the interest rate rise commotion, there is another set of rates that we should be asking the leaders whether they have a plan to keep them under control.

The CSIRO reported in May this year that Australia has the most inefficient economy in the developed world in terms of GDP per ton of C02 emitted. The US economy is increasing its carbon efficiency at twice the rate of Australia. Not only that, Australia's carbon emissions have grown at approximately twice the global average over the last 25 years. If emissions proceed on a business as usual basis, they will increase by 70% by 2050.

According to the Prime Minister's Taskforce on Emissions Trading, the medium term outlook in stationary energy production and mining is bleak. The stationary energy sector's emissions are set to increase by 84% based on 1990 levels by 2020 and resources sector emissions by 97%.

I suspect these rates may be of considerable interest to voters, and not just in the so-called marginals.

Differing politics on interest rates

Today's interest rate rise should on paper be a free hit to Labor to attack the Coalition's economic credentials. However, the politics of the issue are far more complicated than this.

The Coalition, either through good luck or good management, has had the fortune to have held power during a period of unprecedented growth. On top of this, Labor has been terrified to engage the Coalition on economic management with Beazley reserving his attacks to the GST, Latham ignoring the issue entirely and Rudd offering that 'there is not a sliver of light between us and the government on economic management'. On the question of macroeconomic policy, Rudd has launched half-hearted attacks on productivity, skills and infrastructure and attempted to offer an alternative path via his high-speed broadband network.

Rudd's overall dominance over Howard allowed the gap to close on economic management, but recent speculation over rate rises appears to have closed the gap. This is hardening Howard's vote and probably saving him from total obliteration, but as Possum Comitatus has shown, this superior economic management does not effect the Liberals' national vote.

Rudd's key success in this area has been to wedge Howard using his claim that Australia has never had such a strong economy, therefore Australian families have never been better off. However, this wedge is vulnerable if the macroeconomic conditions supersede the microeconomic position of the household budget. The most likely seats where this dynamic is viable are ones where the mortgagors feel they are going forward with an increase in the value of their home.

New South Wales, Victoria and Queensland are the three states where the issue of economic management has played a major role in the Coalition's victories. One of the biggest trouble spots for the Liberals is the former 'battler-heartland' of western Sydney. The median house price in Sydney has dropped by 9% in a year, while interest rates have increased. This perceived gap between household pressure and wealth improvement is showing up in polling. Add the insecurity of Workchoices and it is easy to see a reversal of fortune. The seat of Lindsay is swinging around 9%, likewise the seats of Macquarie and Parramatta. There is even talk of seats such as Macarthur and Greenway, with high levels of mortgagee sales, going to Labor with swings of 12-14%. Ditto that for the Central Coast seats of Dobell, Patterson and Robertson, showing swings well over 6%.

Coalition sources had previously been confident that they would hold seats in Queensland. The multitude of issues in the Sunshine state (traffic/ infrastructure issues, health, council amalgamations, Rudd's Queenslander appeal and nuclear power) dilutes the dynamic somewhat on economic management. However it is no coincidence that it was the Lair from Blair, Cameron Thompson, who was caught on tape calling the interest rate rise a positive for the Coalition. Houseprices in the Ipswich area in Blair have risen by 10% this year. Given the equity improvement, this would give hope for the Coalition that they could counteract the micro experience of workchoices and interest rate rises with the macro trend of increasing prosperity. That sense of making families better off feeds into confidence in the Liberals' economic stewardship. It won't save seats like Bonner and Moreton, but may just muddy the waters sufficiently in bigger margin seats like Bowman and Dickson. Blair is right on the knife edge.

It is likely that the swings in seats like Aston, Dunkley and Casey in the outer suburbs of Melbourne will be curtailed by the effect of increasing house prices. They are certainly not going to behave like their Sydney cousins where all the indicators point down for the Coalition.

Thompson's Garrett-esque candour may be more successful than Rudd's interest rate con argument in reversing Labor's fortunes. Rudd's purely factual argument that Howard has overseen six interest rate rises since 2004 reminds voters doing it tough that Howard has failed to deliver on keeping interest rates low. Adding the 'con' comment might be counterproductive. If the Liberals overtly claim they are using the rate rise to get elected it may open up open hostility among some voters.

The net effect of the interest rate rise in the wider electorate may be to reinforce Howard's economic credentials to undecided voters by having the election conducted on his turf. This deprives Labor of the ability to focus on workchoices and climate change. This may trim margins in seats like Eden Monaro but is probably not going to stop too many marginals going to Labor.

Rudd's Environmental Disaster

The latest Newspoll has come out with Labor ahead 53-47. No doubt Possum Comitatus will be ripping this supposed 'Liberal creep' to shreds shortly. The upshot of this poll is that despite Garrett's gaffe getting two days' coverage throughout the polling period, the Labor vote went down a solitary point. Howard's preferred PM rating went up 2 points, but this is recognition that he has done a pretty good job. Rudd's rating barely moved, giving a net change of 3 points in the preferred PM stakes. Remember Rudd spent a lot of time talking about interest rates (Howard ground) and Howard spent a lot of time giving away road funding.

However, the story of this poll may turn out to be the 'which party best handles the environment question'. Labor's commanding lead, 39-24 over the Coalition has collapsed. The bad news for one J.W. Howard is that the beneficiary is the Greens with 'Someone Else' posting a comparable 27%. This suggests that the electorate thinks that Rudd is too close to Howard on climate change, with only the older voters favouring Turnbull's stewardship. That would suggest that the thing that cut through was Rudd's perceived 'backflip' to cover Garrett's first gaffe, not the 20% renewable energy target. Rudd got no positive benefit from his grand climate launch and the Al Gore walk-on ads did not permeate.

Rudd must hammer Howard's inaction and misleading solutions to gain this impetus back. I suspect that real conviction on climate change might even sway some worried true liberals thinking of voting for conservative independents or climate parties and preferencing Liberal candidates on economic grounds. The mainstream media commentary is peppered with phrases like Rudd has a 20% clean energy target while Howard has a 15% one, plus the bizarre suggestion that Howard will post-election announce a 50% reduction target by 2050. The simple fact of the matter is that Howard is an extremely reluctant mover on climate change, being outpaced by the melting glaciers in Greenland.

Note that Howard has 6% of voters - identical to the 'other' category as it happens, sitting on the fence about his performance. Rudd has 13%, giving him an extra 7% of people he can convince to firm up his standing as preferred PM. By my estimate, the Liberals are officially dead in at least 10 seats and a couple of extra percentage points for Labor's primary vote will kill them off completely. Reminding them of the positive policies Labor has and demonstrating their difference from Howard's creative accounting on issues such as climate change and workchoices may be one way to get them on board.

No planning equals no hope for Howard

I strongly suspect that the Liberals, despite what their boosters in some sections of the media might say, are heading for a rather nasty thrashing. The magnitude of the swing brewing against them comes from a conflagration of factors which a combination of hubris, vanity and groupthink have brought upon them.

The single biggest cause to the upcoming defeat is the abject failure of Howard to plan his leadership succession. I suspect that the failure to pension off Costello comes from Howard's personal view of the world not fitting best with modern circumstances. Howard relied on the Treasury to provide the stable runs on the board to build the government around. If he knew his history, he would have realised that Menzies sent two possible rivals to alternative employment and that Hawke appointed his former leadership rival Hayden Governor-General. All Howard's preferred choices, namely Abbott, Abbott and Abbott are so politically unpalatable as to make Costello look attractive. More modern leaders such as Costello, Nelson and Turnbull are a little too liberal for his liking.

Howard's almost feudal campaign style built a great level of personal loyalty to him, which is exemplified by the high satisfaction ratings. This might look great on paper, but it means that without a plan for the future, Howard will shortly be called into the nation's office and told 'thank you for your work but we'll have to let you go'.

Because Howard has hopelessly mishandled the succession issue, when the party sought salvation from the massacre during the APEC summitt, no options were available. No one was willing to stage a partyroom coup, because they believed Howard a political demi-god. Costello is so unpopular that he would make Crean look good without the assistance of a major policy makeover. Clearly he would need time and scope to redefine himself. Howard clearly believed the myth of his own invincibility and has treated this term like a true oriental despot. Hence his extraordinary imposition of Workchoices (turning up like an unannounced Fightback! package).

Howard's view of the world, particularly on the question of climate change, made him a ticking time bomb if the issue ever became a mainstream concern. Al Gore's 'An Inconvenient Truth' made the issue mainstream. Howard either completely ignored or failed to see that Rudd would eventually become a formidable leadership contender. Once Rudd did become leader, Howard did not hone his economic message nor demonstrate even the hint of a plan for the future until it was far too late.

This acute failure of both historical perspective and knowing what your opponent is doing gives an idea of the historical magnitude of defeat. The average swing for a government to lose an election is 4.7%. However, most governments lose over two elections (e.g. 1969-1972, 1980-1983). Howard won in 1996 with a 5% swing, but this time round Rudd has to scale the swings created by Beazley's loss and Latham's loss. That's an extra 2% than Howard had to make up in 1996. Couple that with the distribution of Howard's vote across his seats and it means Rudd has to have a swing of at least 7% to equal Howard's 1996 result.

Which is precisely what the polls are showing.

Message in the madness?

John Howard and his Liberal party machine have become famous for winning elections by defining the parameters of the election, honing a negative message to not risk the opposition and a positive message to sell the government's credentials. When they have got into trouble during the electoral cycle, they have poured bucketloads of money on their problems and neutralised the threat, thus arresting their opponents' chance to capitalise on policies that serve a narrow, rather than national interest.

This year, the issue of climate change has come back to haunt Howard as his Achilles heel was cruelly exposed. The answer was clearly blowing in the wind (but Fran Bailey was too busy claiming how wind power damaged the tourist industry). Climate change is something Howard wishes would just go away: his inconvenient truth is it won't and has turned his cabinet (and the seat of Wentworth) into an unruly contest between those who can see the writing on the wall and those who consider it to be indecipherable graffiti. Workchoices stubbornly failed to die as an issue as the government's spectacular self-inflicted harm betrayed the battlers.

The Liberals have been totally clueless as to how to fight the election. They have no idea how to get to Rudd and keep vacillating between the old game plan that Rudd has neutralised and the brainstorming ideas Liberal HQ is making up on the run. Rudd has seized the high policy ground and defined the terms of the campaign. Howard has jumped around all over the place on climate change, saying simultaneously that his stands for jobs which will be lost by Rudd's dangerous policy and then that there is no difference between the two parties. I find it fairly hard to believe that Julia Gillard and Mark Vaille have the same view on climate change, nor that the fact that Howard reportedly refused cabinet proposals to adopt emissions trading in 1999 and 2003 suggests we should entrust him with setting our climate course in future.

The economic message which should be Howard's bread and butter has become so scrambled it should probably be served with a side order of hash browns. Howard has said that the economy is going really well, working families have never had it so good. Yet Tsunami Pete sees dark clouds on the horizon. Labor is an irresponsible economic manager, yet Pete acknowledged Labor deregulated the setting of rates. The Liberals are almost embarrassed by their own tax cuts, and their exploratory 'the economy is everything' ad lasted one night.

The Liberals don't seem to know why they are losing support and hence have not the slightest idea how to fix the problem.

Hockey's hamfisted union attacks that unions are both irrelevant and so dangerous that they cannot be put in a position of power demonstrates the deeper disconnect from reality held by his party.

The Liberals seem to be running two messages: growth (greed) is good and unions are the root of all evil. The growth message totally ignores the fact that Rudd has wedged them on the economy - focussing on kitchen table economics rather than macroeconomics. It actively drives voters away. The union message plants an idea in voters' minds which has no connection to the present reality. It drifts the ideological bubble the Liberals exist in out into the community, where I suspect it will receive an almighty pricking.

Ruddy hell: Now Howard's turned into Kevin

Over the weekend the then irremediably cranky Liberal leader, John Howard, made only a cursory appearance to campaign in Parramatta before taking the weekend off.

Peregrine can now reveal that he was attending a new production of 'Extreme Makeover'. If he now proclaims he's 'been there, done that, got the t-shirt', the t-shirt will be emblazoned with the logo Kevin07.

This week, he flew to Victoria and found himself talking to an FM radio station, something he had steadfastly refused to stoop to during his entire career. Having entranced his listeners with tales of lonely breakfast, he then uncomfortably handled a plush bear on morning television. Still he throughly enjoyed himself, even if the only sexagenarian dancing that day was Patti Newton's paso doble.

Following Kevin's Sesame Street renewable energy target, brought to you by the number 20, John Mark II and a half announced, not just that a 20% target would wreak untold damage to the jobs of those poor coal miners, but that he was not opposed to renewable energy and he would look at the detail. Having taken the media persona of Kevin, John now appears to have swallowed his lexicon. Next he will be starting each sentence with a rhetorical question and proclaiming that he's a 'climate change moralist'.

Having snookered Malcolm of Wentworth for having the temerity to raise the prospect of ratifying Kyoto, John appears to be trying to have his yellowcake and eat it too. If he does decide that Kevin's sensible (but conservative) proposal to increase renewable energy share by 12% by 2020 is the way to go, he may need to seriously amend his clean energy target (including clean coal and nuclear). Unless he's planning a clean energy target of something in the order of 30-35%, he might not need his 25 cooling towers to get Ziggy with it.

This election campaign threatens to become acutely boring for political buffs. However, it is a fascinating example of human psychology. One man wants the other's job, while the other wants the other's tactics. Ross Gittins believes much of Howard's legacy is entrenched in Rudd's first term obligations. Perhaps Kevin can teach John Mandarin while they wait to appear on Nova.