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An election nobody won and PMs that no one wants

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On these pages on election eve I warned that soft voters were so disenchanted with "big politics" that they would prefer a third candidate, and when voters rage against the machine, the incumbent is in the greater danger. That's how the election panned out. Voters resoundingly rejected Malcolm Turnbull's plea for the stability of a decisive Coalition victory, judging that neither the Coalition nor Labor had done enough to earn their trust.

In his late-night speech, Turnbull thundered that if only Labor had not run a scare campaign on Medicare the Coalition would have fared better. Apparently there are two types of scare campaigns: legitimate ones about carbon pricing, Whyalla wipeouts and $100 lamb roasts; and illegitimate ones about the privatisation of Medicare.

Perhaps if the Coalition hadn't on so many occasions over the years tried, using John Howard's own words, to "take a scalpel to Medicare", the Labor campaign would not have resonated so effectively. Perhaps if the Turnbull government had not determined in advance that the only way to modernise the Medicare payments system was to privatise it – in accordance with Liberal Party ideology – the Coalition might not have been in such a vulnerable position.

Voters in poor health and on low incomes in Tasmania and in outer-urban seats such as Longman, Lindsay and Macarthur might not have fully accepted that Turnbull would privatise Medicare but they simply could not afford to take the chance.

Exit polls indicated Medicare was the No.1 issue in swinging voters' minds, the economy lagging well behind. But it would be wrong to conclude that soft voters were unconcerned about the economy. Rather, they could not see a real plan from either the Coalition or Labor for jobs and growth.

The Business Council dismissed Dr Dixon's work as "theoretical and unbalanced", as if the modelling for Treasury that assumed a $3.9 billion annual morality dividend from multinationals deciding to wind back their use of tax havens was practical and balanced.At the behest of the Business Council of Australia, Turnbull made a company tax cut for multinationals the centrepiece of his plan. Although the government's preferred economic modeller backed in the company tax cut, other experts, including Dr Janine Dixon at Victoria University's Centre of Policy Studies, questioned the returns from a tax cut that cost almost $50 billion.

In television interviews, Labor shadow ministers were able to cite the lack of consensus on the efficacy of the company tax cut to bolster their opposition to it. Voters were furious that a Coalition government wanted to give an expensive tax cut to foreign multinationals that they considered pay little or no tax anyway.

The more that business groups, backed by newspapers, demanded their tax cut, the more incensed soft voters became, having been told there wasn't enough money to invest in kids who struggle at school or in Medicare, but a $50 billion company tax cut was no problem.

Turnbull's rhetoric about the new agile, innovative economy he wanted to create not only had a terribly unpopular company tax cut for multinationals at its heart, it inadvertently sent a message that the Coalition would abandon workers employed in the old economy. Those mining, tourism and rural industry workers and contractors in regional Queensland, NSW and Tasmania, already enduring pay cuts and job losses, could not see themselves in white coats carrying test tubes in Turnbull's new economy. They voted accordingly.

For its part, a Labor Party, united under Bill Shorten's leadership, rejected a small-target strategy, releasing policies a year or more ahead of the election. Labor stood up to News Limited tabloids and broadsheets that sought to belittle it as incapable of governing. It stood up to the vested interests that campaigned against any limitations on negative gearing, effectively arguing in favour of shutting young people out of home ownership.

But Labor could have done better. Before the campaign started, I argued the party that demonstrated a credible path back to budget surplus would win. Neither party did so, Labor doing more to repair the structural deficit over 10 years but less in the four-year budget period. If Labor had at least matched the Coalition over the first four years it would have gone a long way in fully neutralising the economy as an issue. The necessary savings decisions could have been made before the campaign began, instead of giving the appearance of scrambling under Coalition pressure.

Business groups no doubt will demand the opposition and the Senate behave themselves. They campaigned for a clear Coalition victory but the voters didn't listen. Perhaps business should do less demanding and more engaging. Stability of government after a tumultuous six years and four prime ministers is in the national interest.

I questioned in these pages during the election campaign whether Australia had entered the era of the throwaway prime minister, where voters are so disillusioned with Canberra that they will keep throwing leaders out until they find one who they think has their interests at heart. As far as they're concerned the search continues. Meanwhile, one of the few winners in the election is a resuscitated Pauline Hanson.

Craig Emerson was a cabinet minister in the Gillard government. He is an adjunct professor at Victoria University's College of Business.

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