Labor Party Wins Surprise Fifth Term In Australian Vote

IN a victory that stunned the media, political analysts, and members of both parties, Prime Minister Paul Keating swept past Liberal-National Coalition leader John Hewson Saturday to win an unprecedented fifth term for a Labor government. Labor took 76 seats to the Coalition's 62.

Although polls last week had Mr. Keating pulling slightly ahead, Dr. Hewson was still favored to win.

It was described as an "unloseable election" for the opposition. Three days before the election, the worst unemployment figures in Australia's history were released. Labor's decade in power had seen the country sink into the worst recession since the Great Depression. Hewson's rally, "Labor's got to go," was gaining momentum.

What Hewson offered was a vision of an Australian economy based on free-market principles and reduced government. A year ago, he put forth a radical economic reform package, called "Fightback!," that was supposed to make Australia internationally competitive and get the economy rolling again. But the package was vast and complicated and the 15 percent goods-and-services tax (GST) that was its centerpiece aroused much controversy.

The win is being attributed to Keating's shrewd political instincts. He revealed little of his own plans, but clamped on, crocodile-like, to the GST and would not let go. Despite his own approval of a GST as Labor Party treasurer in 1985, he has since turned against it and said frequently in campaign speeches that people would pay 15 percent more on everything from toothpaste to theater tickets.

Hewson argued that Keating was using fear tactics and misrepresenting the impact of GST. But the former economist was not able to explain the effect of the GST on people's lives.

Aside from the GST, people were concerned about unspecified changes in the Medicare system. They feared that proposed changes in labor's relationship to industry might be too radical.

Some analysts say it was a morally brave but politically foolhardy move to lay out such a challenging package so far in advance. Says Liberal Sen. Bronwyn Bishop, "It was a detailed plan with lots of information. What became quite clear was that there was no understanding of how the current tax system worked." Without that understanding, she says, people could not grasp the new information.

"When things are very uncertain, people do tend to become conservative," says John Rolfe, head of the Business Council of Australia, a group that supports a consumption tax. "Coalition policy was advocating changes in a number of areas and the government was proposing that things go on as they were."

The polarized race ended up costing seats of the smaller parties, the National Party, the Democrats, and the Greens.

Keating has been in office for only 15 months. As treasurer, he wrested control of the party out of predecessor Bob Hawke's hands. This win cements his political future as head of Labor and enables him to reshuffle his Cabinet without pressure from factions.

"I wanted to win again, to be there in the 1990s, to see Australia prosper as it will," he said in his victory speech. "We have turned the corner; the growth is coming through. We will see ourselves as a sophisticated trading country in Asia and we've got to do it in a way where everybody's got a part in it."

In his concession speech, Hewson said the Liberal National Coalition had "raised tough issues and fought the hard fight. I believe we did it the way it should be done, and I hope the politics of fear do not become the Australian way of life."

After the resounding defeat of his GST, Hewson was expected to step down as head of the opposition. But yesterday, after consulting with other party members, Hewson announced that he would stay on.

But the opposition's support of a GST would go. "If anything, this election was a referendum on the GST. The people of Australia have spoken - they don't want it," he said.

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