Howard Secedes From The States

Editorial - Canberra Times

John Howard's enemies, from both his left and his right, may well think this is his most dangerous and radical step yet. The Prime Minister has said more bluntly than ever before that the Australian federal system is up for grabs, and that the states and the federal division of powers stand in the way of social, economic and political development. He acknowledges that it might be practically impossible to abolish state governments - though he asserts that Australians today would not recreate the federal compact were they uniting now. But, he implies, the Commonwealth will be uninhibited in using all of its constitutional powers, including state-function-grabbing ones such as the corporations power, to remove traditional powers from the states. Or, at least, to remove them if they will not play ball with Commonwealth ambitions and ideologies. If they play well, well perhaps, they might be tolerated.

It's not so as to centralise power in Canberra, of course. Or, in the increasing presidential Australian system to centralise power in him. No, no. It's to hand back power to the people. To give them freedom, flexibility and individual choice. To free them from bureaucracy and from an obsolete system where there are different rules on different sides of the river, now that efficient transportation and communication has created a single national marketplace.

Or would, except for local overregulation. And, of course, local poor delivery of basic services - such as health. And education. There he is, the Prime Minister who has done the most to give the states more revenue, a growth tax, and the capacity to plan ahead. And what have they done? Become more inefficient and ineffective, while failing to lower taxes and burdens on the people. While, of course, blaming all shortcomings on the Commonwealth. Well, he's not going to go along any more. His first step will be in creating a unified system of industrial relations, with or without state cooperation. Reform might be more incremental with health and education, and vocational and technical education, and he has no predisposition for a single government delivering services. But, by golly, the systems must meet national aims, so as to produce less, not more bureaucracy, and greater choice and opportunity for Australians. Many, particularly on the Labor side of politics, will agree with his critique of the increasing obsolescence of the states, and will prefer political change which recognises that Australia is now a single market, and that aspirations for good health, welfare and education are national ones, rather than ones which can be determined differently in Queensland from Tasmania. That Labor dominates in state and territory administrations may make one aspect of Howard's agenda party political, but Laborites might think it a wonderful thing that it be a conservative government which tries on the substantial increases in Commonwealth power that recourse to constitutional provisions such as the corporations power, or the external affairs, power permits. The prevailing view of the corporations power, for example, is that any law which says that "a corporation shall" or "a corporation shall not" is a legitimate expression of Commonwealth power, even if such a law gives it power to regulate something traditionally seen as within the state sphere.

John Howard says that he wants to use such power to deregulate rather than to regulate; yet any long-term politician would quickly see that anything determined by such a law could be redetermined, and that such a power could also be used to increase the Commonwealth's regulatory or supervisory roles. A power to impose a single deregulated industrial relations model of Howard's choosing is also a power to impose a single regulated system of Labor's choosing, and without the inconvenience of state obstruction. A power to free up markets is a power to tie them up.

At federation, the prevailing theory was that power came from the top - from the sovereign. It was being divided up, with legal and political checks and balances on the beneficiaries. Another theory was that it was the states - or colonies - which had agreed to federate, rather than the people of the states: the reason why, for the first 20 years at least, the idea that there were powers reserved to the states was so strong. The Commonwealth was given specific powers over some things - defence for example. What was not handed to the Commonwealth was, by implication, left to the states. But even apart from the balance between these entities (and local government, subsidiary to the states), power at each level was divided between parliaments, the judiciary and executive government, each, presumably, jealous to make sure that other arms of government did not encroach on its prerogatives. The people were scarcely mentioned, and the idea that there were zones into which no government, or arm of government, could go, was there only in rudimentary form.

Over time, more and more power has accrued to the Commonwealth, all the more so given the principles that any valid Commonwealth exercise of power overrides any contrary state power or legislation. The trend is accentuated by increasing Commonwealth control over taxes, a situation which has not changed with the GST, as Treasurer, Peter Costello, is making clear with his threats to withdraw GST revenue from the states.

But the accretion of power has usually been gradual. What ought to be clear is that what Howard is threatening is major change, and without any necessary changes in the checks and balances.

In traditional analysis, it has been the conservative side of politics which has put greatest stress on the need for the checks and balances, and the power to use them to block unwelcome change.

But Howard has never been conservative in this sense of the word. He's pragmatic and willing to use whatever tools come to hand. There's no doubt that it will flabbergast some of the politicians in front of it.

But it will also worry quite a few of those behind them - and their colleagues back in state capitals.

There will be plenty more shooting in the street before the outcome of this coup d'etat is clear.