Inside Story

Costello redux?

The former treasurer rode a worldwide economic boom to fame; now there are calls for his return to parliament

Peter Brent 5 April 2018 1164 words

A question of timing: former treasurer Peter Costello encounters former prime minister Tony Abbott during a visit to parliament last December. Mick Tsikas/AAP Image

Bob Carr was the longest continuously serving premier of New South Wales, holding the top job from 1995 to 2005. His 1999 and 2003 re-election victories were huge, approaching the Wranslides of his mentor four decades ago. Utterly dominant in the parliament bearpit, master of the media, Carr was seen by some as, in the words of his biographer Andrew West, “the nation’s wiliest politician.”

In 2012, after seven years of retirement (political, if not professional), Carr was shoehorned into the Senate by prime minister Julia Gillard. The anticipation among the political class was keen: might this be a turning point for the fortunes of her government? And on his very first day as foreign minister he set about working that old magic, giving a doorstop interview in which he likened opposition leader Tony Abbott to “a cheapskate hypnotist in a rundown circus.”

Abbott was “trying to hypnotise the electorate with these slogans. It’s a very cheap performance. And if you paid five bucks to get into Wirth’s Circus and that’s all you got from the hypnotists, you’d ask for your money back.”

Kapow. Vintage Carr, a bravura performance. They don’t make them like that anymore.

Or maybe they do, because it didn’t quite work. Something wasn’t right. Stripped of the accoutrements of authority, of electoral dominance and big opinion poll leads, it wasn’t so magical. Instead, it was faintly ludicrous. What had set the world on fire in one set of circumstances didn’t quite translate to another.

Writing in Fairfax papers today, journalist Imre Salusinszky, once a staffer to NSW premier Mike Baird, relates, with approval, chatter among Liberals keen to draft former treasurer Peter Costello back into federal parliament to take over the leadership. All going well, he would then rescue the Coalition from its upcoming defeat.

If you’d blinked last September you might have missed a mini-push along the same groove by News Corp columnists and wealthy Liberal figures; that scenario specifically involved a return in his old electorate of Higgins to punish the incumbent, Kelly O’Dwyer, for daring to be the public face of the Turnbull government’s changes to superannuation.

As Salusinszky points out, the sixty-year-old Costello is still in his prime, younger than Malcolm Turnbull and Julie Bishop.

And what a time it was, 1996 to 2007, when he and John Howard dominated the landscape, seeing off a succession of Labor leaders. Low interest rates, low inflation and low unemployment, plentiful budget surpluses, a galloping economy. Costello, the former barrister, devastating the opposition in parliament.

Imagine the minced meat the former treasurer would make of neophytes Bill Shorten and Chris Bowen. Question time would be fun to watch again; Peter would have the budget back in the black in no time; those bountiful times would roll once more.

The trouble is, as Scott Morrison is finding out, and Joe Hockey and Wayne Swan did before him, if you want to be a legendary treasurer, like Costello and Paul Keating, you need to hold the job during an economic boom. Only then can you bring down those surpluses, generously dispense tax cuts, beat your chest, and castigate the other side for their record in government. And those booms can be facilitated, a bit, by government policy, but are mostly bestowed by events outside this country and things done by earlier governments.

Costello and Keating were, after all, respectively the highest and second-highest taxing (as a percentage of GDP) treasurers in the country’s history, not because those men or their governments possessed big-government inclinations, but because the Australian economy was growing so fast.

The same preconditions apply to prime ministerial longevity.

As Carr discovered six years ago, perceived political prowess is largely hostage to circumstances — namely, economic and electoral cycles — and practitioners are never as brilliant or woeful as they seem at the time. Costello’s decision to decline the opposition leadership in December 2007 indicates he has an inkling of that reality at least. It was a smart choice, because he would have suffered a similar fate to Brendan Nelson, buried under a rampaging popular government.

That would have been our final memory of Costello — not as the country’s longest-serving and, for many, most successful treasurer, or as an almost prime minister, frustrated by his leader’s refusal to step down, but as a failed opposition leader.

(He might have been kicking himself in December 2009, though. Once he’d made the decision to leave parliament, the leadership suddenly came up for grabs, Labor started to falter and an election was due within a year.)

The longest boom, from the early 1990s to the global financial crisis, was another country. The dramatic numbers in this table from a recent Inside Story article by Tim Colebatch go a large way to explaining today’s political climate, and not just in Australia.

And then there’s the current, difficult Senate with its swollen crossbench, the result of a long-term trend to minor parties exacerbated by those same post-GFC economic realities. The idea that John Howard or Costello would be faring much better fiscally today is a fantasy. They too would be buried by today’s economic and parliamentary conditions.

And yet…

It is undeniable that Australians, even after a decade, retain positive feelings towards the Howard government, representing as it does life before the bottom fell out of the world economy. Wallets were open and the good times seemed like they would last forever.

More than any other government in recent memory, it was, after a short time, mourned in retrospect. The GFC was timed perfectly to cement its reputation.

During the 2010–13 term, part of opposition leader Abbott’s political argument was that voters could get Howard redux simply by changing governments. The association, still fresh in people’s minds, made it a sensible election strategy. Most Australians still reckon Howard ran a good government and economy. He routinely tops the charts in polls ranking prime ministers.

So there is something to be said for the idea of drafting Costello. It would have to be timed well, perhaps outside parliament, Campbell Newman–like. Or via a by-election not too long before the general election. The return of one of those famed grown-ups from the past, he’d receive a splendid honeymoon.

Of course, just as Abbott’s promise of economic nirvana proved fraudulent, and he paid a heavy price, there would be a reckoning for Peter in the medium term if he did achieve a win for the Coalition. Bob Carr learned that clothes make the politician, and unless the various straitjackets Costello would inherit were dramatically loosened — if he were again, as Paul Keating once put it, to be “hit in the arse by a rainbow” — it would end in tears.

We witnessed Turnbull’s rapid demise from the post-change peaks of late 2015. Peter would not find it much easier.

But he would get to be prime minister, for a time. That must be tempting. ●