2013-06-26

Australia Labor dumps its PM; Liberals have inside track to victory

More than a year ago I wrote about the battles within Australia's Labor Party in Australian Labor party internal dispute puts the U.S. GOP to shame
Rudd resigned from leadership (rather than be fired) in 2010 and was replaced by Gillard. The proximate cause was his support for a mining tax, but it was social mood that was his undoing. The party was weak in the polls and sought a leadership change to maintain power, and the analysts note that Rudd is more popular with the electorate, Gillard with party insiders.
Internal disputes forced Rudd from power in 2010, but the internal battle intensified and continued until now, when Rudd has turned the tables and knocked the prime minister from power.

Australian government dumps PM Gillard for former leader Rudd
Australia's ruling Labor Party elected former leader Kevin Rudd as prime minister and dumped Julia Gillard on Wednesday, in a dramatic move to try and head off a catastrophic defeat at elections due within three months.

The return of Rudd could now see Australia go to an election in August rather than the set date of September 14, to cash in on his greater popularity with voters and an expected honeymoon period with the electorate.
Rudd resigned after proposing an unpopular mining tax that looked set to sink his party in upcoming elections. This time around, Gillard was growing unpopular. Although students tossing sandwiches at her didn't help her poll numbers, it was recent comments about women's issues that caused a nearly 7 percent drop in her support among men. It was an attempt to steal from the Obama playbook (a war on women), but it backfired badly.

Back in 2010, the Labor gambit worked. The new PM, the first female, enjoyed a boost in support and early elections led to a Labor win. This time, I expect a different outcome: the Liberals are coming back into power.

In any case, the shakeup at the party level has one major cause: social mood. The Australian dollar plummeted in May, with the stock market also falling at a healthy clip. Commodity prices are tumbling again, as they did in 2010 when Rudd and his unpopular mining tax were shelved. Labor could always come up with something to entice voters because technically they haven't lost them yet, but the odds are stacked against them. The trend in social mood favors the Liberals.

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