Most economic commentary now points towards the possibility that the federal government either can’t or won’t do what is required to turn the economy around.
It’s the ‘P’ word. Productivity.
Why is this a communication problem? The government cannot land a big idea unless it brings voters along for the journey.
It isn’t for want of a forum. Fourteen months ago, Chalmers convened an Economic Reform Roundtable on productivity, economic resilience and budget sustainability.
Paul Keating put it bluntly at the launch of James Curran’s book Grand Ambition in Sydney on 2 September,
Structural change, he said, stopped after John Howard’s GST in 2000, “We’ve gone 26 years without any structural change fundamentally and of course it shows in the lagging productivity and the lagging growth numbers.”
He gave the government a nod for moving on a couple changes: the legislated changes to capital gains tax and negative gearing on housing.
Both are about housing affordability. Their link to productivity is marginal at best. According to Keating, “You got governments today afraid of change or moving.”
Economist Matt Vickers says the government has to make sure major decisions, taken together, move labour and capital towards their most productive uses.
Keating was clear about where he thinks growth comes from. Recalling the 1980s, he told Kerry O’Brien in 2013,
“My key point was that you could not bring the Australian economy back to growth off the back of public investment and public employment. The primary driver had to be private investment and private employment.”
The Author – Peter Wilkinson
Is that happening?
Don Russell, once Keating’s principal adviser and now chair of AustralianSuper, has the words for what’s happening. Peter Hartcher reminded us of them in the SMH/The Age last weekend (3 October).
Russell sorts leaders into two kinds.
- Pleasers avoid upsetting anyone, chase approval from every group, and shield voters, and themselves, from bad news.
- Doers name the problem, are seen to fix it, and keep explaining it.
Within days of last week’s rate rise to a 15-year high, the Prime Minister was flagging more cost-of-living relief. A pleaser’s reflex.
When the news is consistently bad, people judge a leader less on the explanation, and more on whether they are seen to be fixing it.
What is seen as tinkering around the edges doesn’t cut it.
It seems everyone is beginning to recognise that increased costs and flatlining growth are irreconcilable. Hence rising inflation. Inflation goes down when production is faster than consumption.
Voters and One Nation
Michele Bullock added to discontent at her press conference on 29 September. She began,
“Inflation is too high and has been driven by domestic capacity pressures. The inflation impulse from the Middle East conflict is in addition to this. Domestic spending and investment have been stronger than expected, despite weak sentiment and the softening in housing market conditions.”
Many have stopped waiting. The latest Newspoll has One Nation on 30 per cent and Labor on 27, Labor’s worst Newspoll result since 2012.
If your customers were drifting away at that rate, would your board be tinkering?
The power of a Big Idea
Keating explained it this way to Richard Fidler on ABC’s Conversations in April 2012,
“The power of the Big Idea carries with it its own momentum.”
His example was the story he told as treasurer and prime minister. Australia could no longer stay a country ring-fenced by tariffs, with a managed exchange rate and sclerotic financial markets. Then he added,
“These were big ideas and if you market them and tell the story properly, I think you can cut through the static.”
Doers argue the case
Russell went further in Leadership, his 2021 book. Gareth Evans, reviewing it, summed up how Russell’s doers communicate. They assume the audience is intelligent and choose substance over slogans.
Pleasing isn’t only a Labor habit. Economist Chris Richardson told Hartcher both sides have been pleasers since WorkChoices, the Howard government’s last big reform.
Pleasing or Doing are good descriptors of reputation management in companies too.
Take KPMG’s self inflicted crisis. Each reform KPMG attempted seemed aimed at pleasing: What’s the minimum we can get away with? A pleaser reflex?
A doer asks something harder: What would it take for staff and clients to trust us and be proud of the firm again?
Doing the minimum can cost the least in the short term, but we pay for years to come. Doing what is needed costs more in the short term, but pays off for decades.
What’s Next?
The August ’25 roundtable was the government’s chance to land a big idea on productivity. Around 900 submissions and 41 mini-roundtables fed into three days in Canberra. What came out Deloitte called underwhelming. Last week, the Reserve Bank Governor delivered the verdict – “productivity is doing nothing”.
Communication starts with a decision. Then Messages should be Clear, Concise, Consistent: one idea, said simply, said the same way every time, eventually understood by everyone.
Keating did that with the tariff wall and the floating dollar, and the story still carries momentum.
