What will change the way the country is run in the future is the example of the Ruby Princess, the boat the Commonwealth didn’t think to stop. There is an irony here because primary responsibility rests with the NSW health and port authorities, which allowed the 2700 passengers to disembark without testing. The Commonwealth has some justification in blame-shifting on this point. But the Commonwealth’s failure is the more relevant. The buck for border protection ultimately stops with the Morrison government, and the states and territories will not have missed the implication of this loss of control. A failure of Commonwealth co-ordination mutated with state neglect, undermining every government’s trust in the federation. It should not surprise Morrison that the states are going their own way where they can.
The isolation of state from state is forging a new unity of purpose by default. Tasmania, the poorest state with the oldest population, was first to move last Friday, closing its border with the mainland. By Thursday, every state and territory was in a form of lockdown. The borders of Western Australia, South Australia, the Northern Territory and Queensland were effectively closed, while Victoria was pushing the Commonwealth to the inevitably of a tougher policy response with a stage-three national lockdown.
These examples of state and territory assertions of power won’t be easily forgotten. It is too early, of course, to predict the outcome of the pandemic, let alone what the federation will look like in the recovery. Suffice to say, the premiers and chief ministers will no longer view the prime minister, whoever he or she may be, as the only person in charge of the country. This is a structural shift that would have occurred regardless of Morrison’s performance in this crisis, because the problem is the federation itself. The coronavirus is a stress test of systems: the Commonwealth’s tax, spending and migration policies, and the states’ delivery of health and education services. It uniquely challenges both jurisdictions at the same time, punishing the weak links where the roles between the Commonwealth and the states overlap. The Ruby Princess is what happens when two tiers of political ego and bureaucracy rub up against each other. Neither is ever responsible, and all sides are wise after the event.
Australia will have plenty of time to think about the federation because after the first wave of the pandemic passes, the country will remain physically separated from the rest of the world to guard against a second wave of infections. Other nations will be thinking the same thing. This week, China closed its borders to foreigners.
The six months of hard times the Prime Minister talks about could easily run for 18 months, as the economy is denied an easy return to growth through the free ride of overseas migration.
Australia is, in effect, being snap-frozen. But what that country looked like only a few weeks ago won’t necessarily hold during our period of enforced global isolation. Australia will continue to change as cities, and regions, find new drivers of growth within the confines of a relatively closed economy, while others are left behind.
The examples of past booms and busts contain a recurring theme. The three long runs of prosperity in Australia’s history: the wool and the gold rushes of the 19th century; the post-war reconstruction of the 1950s and ’60s, and our uninterrupted growth between 1991 and 2019 had a dominant Melbourne in common. The Victorian capital was the fastest growing city in each boom, because of its ability to attract and retain people from overseas, and to draw people from other parts of Australia.
Prosperity was shared in the closed economy of the 1950s and ’60s. Adelaide, for instance, was lifted by the same migration and manufacturing waves as Melbourne. But in the open economies of the 19th century and again since the reforms of the 1980s and ’90s, wealth and power was concentrated in Melbourne and Sydney.
At the other side of the previous booms was a Melbourne-centric bust. The depression of the 1890s, and the deep recession of the early 1990s saw large numbers of people flee the cosmopolitan city for the frontier states – to the Western Australian gold fields in the 1890s and to the early retirement of Queensland’s south-east in the early 1990s. This allowed Sydney to resume its position as the nation’s unchallenged capital, while Melbourne waited sullenly for the next migration wave to break in its favour.
There is reason to believe that this pattern won’t repeat now the economy is in freefall. The clue is in the essential differences between the cosmopolitan south-east and the rest of the country in the 21st century so far. Sydney and Melbourne hold more than 40 per cent of the Australian population between them, and more than half of all those born overseas, including more than 60 per cent of all the Indian-born and more than 70 per cent of all the Chinese. They have collected the lion’s share of the skilled migrants, a windfall that has allowed them to slow the ageing process while it accelerated in the smaller cities and regions that missed out. Adelaide has been the most notable victim of this trend, and is on course to have more people aged 65 and over than children under 15, either this year or in 2021.
The head start that Sydney and Melbourne take into this deep recession is the skills of their young people. They hold the key to recovery because they are the most likely to have jobs to go back to in the knowledge economy.
This culture shock has been hiding in plain sight for some time. No other rich nation to which we compare ourselves settles its population in the Australian way, with two global cities of roughly equal size, with a tradition of rivalry on every aspect of national life, from the economic model at federation to winter sport.
Canada comes closest to Australia’s twin-city model. But its settlement is bilingual and decentralised. The English-speaking Toronto has 6 million people; the French-speaking Montreal has 4 million. Together, they account for fewer than 30 per cent of Canada’s 35 million people. The question of which city would be the largest was decided half a century ago, and the gap between the two has widened ever since.
The latest figures for 2019 released this week show Sydney has 5.3 million people; Melbourne almost 5.1 million, in a nation of 25.4 million. Melbourne alone was responsible for 30 per cent of the nation’s population growth last year; Sydney contributed another 23 per cent. They have been propping up the economy since the end of the global financial crisis.
The threat to social cohesion was never really in the cities’ disagreements. The danger was that Sydney and Melbourne would one day resolve enough of their differences to separate from the rest of the country. A measure of that realignment can already be seen in the response of the NSW and Victorian governments to the pandemic. As the states with the most to lose in the short run, they have pressed hardest for a lockdown. Will the two states extend this co-operation in the recovery to, say, climate change and energy policy?
It must be said that the NSW Premier Gladys Berejiklian hasn’t thrived in this crisis. The legacy of the Ruby Princess will weigh heavily on her administration. But Daniel Andrews has; his assured, jargon-free voice contrasts with the Prime Minister’s rambling, often contradictory announcements.
Andrews and Morrison have a healthy, but wary respect for one another. For the time being, the onus is on Andrews to defer to Morrison. The Victorian Premier would appreciate that a public split with the Prime Minister would risk community panic. But once the pandemic is over, the roles will reverse. A new federal compact will have to be struck. The challenge is for Morrison, or his successor, to share power more productively with the states and territories. Otherwise Sydney and Melbourne might just grab what they can for themselves.
George Megalogenis is a journalist, political commentator and author.