Peanut farmers, rocks, and hard places

It’s becoming clear that the Rudd Government never expected the strong level of opposition to its health funding reforms that John Brumby and the Victorian Government have served up over the course of the last couple of weeks. As Michelle Grattan and David Rood reported in yesterday’s Age, the relationship is quickly becoming toxic. Premier Brumby stepped up and addressed the National Press Club on the topic yesterday, and on Tuesday, even drew parallels with the behaviour of the Prime Minister and the behaviour of Queensland Premier Joh Bjelke-Petersen in the 1970’s. This was an extraordinary contribution to the debate, considering that Brumby and Rudd are supposedly from the same political party and that Brumby could hardly have cast a greater slur on his northern colleague. The germination of the Prime Minister’s political career in Queensland was arguably in no small part driven by the vulgar excess of the Bjelke-Petersen years.

The Prime Minister seems determined to win the day on health reform, and is prepared to continue upping the ante with more funding and incentives until he gets it, whilst refusing to fundamentally alter the underlying structure of the deal. Whether the Federal Government’s approach in a policy sense is correct seems, sadly, to have degenerated into a second order issue, at least when compared to the political shit fight for ownership over health reform.

This puts Premier Brumby in an invidious position, given the staunchness and nature of his opposition thus far. Brumby has already proposed an alternative plan (e.g. a 50/50 funding split without the 30% loss of GST implied by the Rudd/Roxon plan) that he holds to be a considerably better agreement for all parties. But as the offer on the table from Canberra gets bigger and more attractive, the pressure on the Victorian Premier to bite the bullet increases. The overwhelming majority of the shot in this war is in the Federal Government’s locker. The fraternal politics of the situation for the Labor Party are diabolical. No Labor Premier would want to be remembered as the person responsible for critically undermining a Federal Labor Government about to wage its first election campaign after over a decade of conservative hegemony. Sooner or later, the Victorian Premier will be coerced into caving in by the sheer force of the taxpayer dime on offer, and the broader ramifications of not signing up.

In the next couple of weeks, Brumby is going to have to find a way to be a good little Labor Premier and acquiesce, whilst at least appearing to have won some concessions from those bovver boys and bovver girls from the nation’s capital.