Key Takeaways:
- The Liberal party is struggling to find its purpose and needs to focus on repairing its performance numbers on economic management and housing.
- The party’s electoral success was built on its differentiation from Labor on economic management, but it has lost its lead on this issue.
- The National party’s influence over policy has made the Liberal party uncompetitive in urban seats.
- The non-major party vote has grown to 33.6% over the past 10 federal elections, with One Nation being a significant beneficiary.
- The Liberal party needs to unite behind a bold economic reform project that offers persuadable voters a new economic compact underpinned by promise and hope.
Introduction to the Liberal Party’s Current State
The Liberal party is currently facing an identity crisis, struggling to find its purpose and differentiate itself from the Labor party. In its heyday during the Howard government, the Coalition enjoyed a strong lead over Labor on economic management, which was the most salient issue among swing voters. However, the latest Australian Financial Review opinion poll found that only 19% of voters believed the Coalition was the best party to deal with cost of living and housing affordability, which are currently the two most important vote drivers in the electorate. To become competitive again, the Liberal party needs to focus on repairing its performance numbers on economic management and housing.
The Need for a Mindset Change
A good place to start is by looking at what John Hewson started and John Howard and Peter Costello finished: recovering from the party’s 1980s dysfunction by unifying around a singular organizing principle on economic reform. However, this will require a significant internal mindset change from both the Liberal and National parties. Over the past decade, the Nationals have increasingly become the tail wagging the dog when it comes to its Liberal party partners. The modern National party no longer makes concessions to urban seats, instead playing a zero-sum game that is making both center-right parties increasingly irrelevant to voters in their respective constituencies.
The Consequences of Becoming Nationals-Lite
The Liberal party has become Nationals-lite, which has limited its electoral appeal in urban seats. The party now only holds nine out of 88 urban seats in Australia. While it’s true that the Liberal party can’t win government without the National party, at the moment, the Liberal party can’t win government with the National party because their pervasive influence over policy makes them so uncompetitive in urban seats. Compounding this challenge is that the Liberal and National parties are also currently losing vote share to One Nation, which is symptomatic of a fragmented electorate producing fragmented voting patterns.
The Growth of the Non-Major Party Vote
The non-major party vote has grown to 33.6% over the past 10 federal elections, with only two-thirds of the electorate voting for the two major parties. In the most recent national poll, the non-major party vote was at 37% and expanding. A lot of this growth is occurring in the One Nation vote segment, which was at 18% nationally and highest at 26% in the gen X male cohort. The primary component behind the bleeding of this vote to One Nation is not the culture wars, but a broken economic promise. The Liberal party was very competitive with male gen X working-class conservatives on the promise of aspiration, but over the past decade, the party has lost the confidence of these voters as housing became more unattainable, employment less secure, and wage growth anemic.
The Path Forward
To expand their electoral maps, the Liberal and National parties need to offer a plausible path to security, rather than relying on identity and resentment. Economic anxiety should be fertile ground for the Liberal party in particular. The party needs to unite behind a bold economic reform project that offers persuadable voters a new economic compact underpinned by promise and hope, especially in urban seats, and including the teal seats. This means a return to the principles and values of the successful Coalition partnership led by Howard and Fischer, where the coalition parties made internal trade-offs and accepted compromise to broaden electoral appeal. The Liberal and National parties need to stop searching for shortcuts and competing with themselves by creating and chasing noise, and instead move away from the extremities of public debate and unify as a coalition with an economic reform narrative that is pitched at Coalition-coded voters, particularly the younger professional and urban cohorts.
Conclusion
In conclusion, the Liberal party is at a crossroads, struggling to find its purpose and differentiate itself from the Labor party. To become competitive again, the party needs to focus on repairing its performance numbers on economic management and housing, and unite behind a bold economic reform project that offers persuadable voters a new economic compact underpinned by promise and hope. The party needs to move away from the influence of the National party and stop competing with itself, instead unifying as a coalition with an economic reform narrative that is pitched at Coalition-coded voters. If the party fails to do so, Anthony Albanese’s ambition to make Labor the natural party of government will become a reality.
