Ute-gate a sign of the economic times

The Interpreter hasn't bought in to the 'Ute-gate' story because it lacks an international policy angle. But Paul Kelly's excellent op-ed today shows that's not quite true. The controversy would not have happened without the Government's establishment of the OzCar scheme, a direct state intervention in the economy in response to the financial meltdown. The Liberals don't like that sort of thing:

The feature of the Malcolm Turnbull-led Liberal Party is its distaste for the interventionism that Rudd hails as a new epoch of social democratic capitalism. This has become the central organising principle of Rudd's government. It is loathed by many Liberals as an invitation for rorts and cronyism. It still remains too early to know whether Australia and other industrialised nations will witness the growth of a new form of social democratic corporate state or if the interventionism will prove transitory.

But the ideological division within politics is growing: the Liberals distrust much of the fiscal stimulus, the Ruddbank, the national broadband network, the deposit guarantees and most other Rudd interventions. Indeed, Turnbull asserts the main policy challenge for Australia is to prevent the corruption of the market economy by Rudd and Swan...So Turnbull's attack was not just on Rudd-Swan ethics but on the Rudd-Swan policy philosophy.

This is exactly the ideological debate Mark Thirlwell has been tracking in his posts about post-GFC economics and the return of Keynesianism.