Gary,
As you point out Howard + Co (Finance Minister, Senator Minchin) are attempting to shift the blame to the states. They are saying that while the Federal Government has kept its budget in surplus, the states have run up $70 billion of extra debt, placing upward pressure on interest rates.

Economists disagree. Access Economics director Chris Richardson said while both levels of government were putting pressure on interest rates, federal policy costs were significantly higher than those of the states. Moreover, the states were largely borrowing for infrastructure investment while Canberra had handed out the fruits of the mining boom through billions of dollars worth of personal income tax cuts.

Howard has a credibility problem.

Nan,
Housing afforability continues to bite, especially in Sydney. The new look digital SMH reports that:

The housing affordability crisis has spread so far beyond Sydney that the traditional escape route - moving to the Central Coast, Wollongong or the Blue Mountains - is no longer an option for many first home buyers. Between 2001 and 2006, the median cost of a home in Wollongong has leapt from about $220,000 to $400,000; in Gosford it has soared from less than $250,000 to just under $400,000; and in the Blue Mountains the price is up from $230,000 to more than $350,000.

So what do people do now? Go to the Gold Coast or Brisbane?

I believe that land in Broken Hill is fairly affordable!

I've been wondering the same thing. Why does Howard keep sticking with a script that stopped working ages ago?

In fact he seems to have ramped it up a couple of notches from arrogant to SuperArrogant.

Maybe his secret ambition is to gloat when Costello's stuck with the crippled leader of the opposition role.

Daniel,
it is certainly not Canberra.

An audit/report issued yesterday by the Urban Development Institute of Australia showed the territory had the smallest proportion of affordable houses for sale of any Australian city, after the mining-boom state of Western Australia.

Housing affordability in the ACT has plummeted, with a home now costing more than five times the average household income of $82,500 a year. In 2001, an average house cost just three times the average household income.

Most people living in Canberra's western suburbs could not afford to to buy their house at today's prices

Lyn,
I puzzle about it too.My best guess is that the Howard Government is locked into their strategy and they have few options.

The Howard Government has been advised by their pollster consultants to stand on their strength--economic management. They say that they are good at the management, take their responsibility seriously etc whilst Labor does not. So they bash the states for poor service delivery and bad economic management.

What else can they do? Economic management is meant to be their strength and they are muscular on it. They say they have done nothing bad, nor are they responsible for the upward pressure on interest rates. Since the national security stuff is not giving them any traction at the moment, they have to bash away on the economic mamagement stuff. It looks as if the wagons have been drawn around the high ground.

In todays Question Time Howard and his ministers looked defensive and desperate. They ranted and raved (lots of confected outrage) at the awful Labor states.

The Howard Government broadened the attack the states front when they defended the democracy of local government against their amalgmation by the horrible Beattie Government. The latter is nasty as it is stamping all over people's interests, and it is the Howard Government who is the people's best friend. It stands with them in their defence of democracy. Nothing was said about the financially unsustainable local councils in a sparsely populated western Queensland.

I would have thought that it is the mayors and councillors who are creating all the noise (losing their jobs?), rather than the ratepayers.

Lyn,
A lot of people up here are very upset about the proposed amalgamation. Right or wrong its a big issue.

Sorry to Lyn.
My last comment should of been directed to Gary

Les,

I'm Gold Coast myself, and if somebody suggested bludgeoning the council to pulp I'd probably go along with it. The news footage and letters to the editor certainly give the impression that a lot of people are upset about the amalgamations. On the other hand, a lot of the placards said stuff along the lines of if you sack the council there'll be no jobs in our town. Very odd.

Gary,

On the locked-in strategy and no options bit, I'd go along with that. The thing I find surprising is that they seem to have set the strategy without bothering to keep an eye on Rudd.

Had they put a little thought into it earlier on they'd still have options now. Not a lot admittedly, but at least some wriggle room.

They seem to have set the course in the firm belief that they already had it in the bag. Stupid.

Yes in question time they ranted and raved but it was a clear and cleverly orchestrated rave from start to finish. From the 3 women sitting behind the microphones (always amusing)to the nationals having the last word on the council amalgamation. Yes, and that look of admiration that Howard gave Costello was top shelf stuff.
We have moved now into the "Deep Strategy" phase of the campaign where the Coalition will bombard Labor with one thing after another. Of coarse the threat of Labor governing state and federally will play a big part. It would be silly of them not to play that card.

On the subject of House prices.
House and land prices wont go down by the governments doing. This is clearly evident by the experts saying that increasing the first home buyer bonus will actually have the opposite effect. So to look to the positives the prices in cities are clearly getting people looking and buying in regional and country areas and that is a good thing. A very good thing.
So I would think the Beattie government amalgamating councils at this time is wrong. Yes a lot are borderline or going back wards so why not support them and prop them up a bit so as to help get more people in homes.

Les,
okay rationalisation of local councils from 157 to 72 is unpopular in Queensland Hence we another white knight commonwealth invention-- a referendum this time. Queensland is a key state for the ALP.

If we put politics aside, then the reform of local council boundaries is well overdue, as some are more than 100 years old. There are 1250 elected representatives in 157 councils in Queensland.

I understand that a government commissioned report found 43 per cent of the 157 councils were financially unsustainable, many of them in western Queensland, and that 88 of the councils service populations of 5000 or fewer people.

That's a different situation to the Gold Coast is it not?

157 to 72 in one go is a bit harsh in my book. Why not do it gradually starting at the worst.

I think the problem on the Gold Coast is perhaps based more around honesty issues and it has been widely reported.

Lyn,
I have got my black clothes and bludgeoning implements ready to go when you are.
We will have to take out the ex Footy player and the Elvis impersonator as well. Yikes! if they get up it could get worse!

Lyn,
re your comments' On the locked-in strategy and no options bit, I'd go along with that. The thing I find surprising is that they seem to have set the strategy without bothering to keep an eye on Rudd. Had they put a little thought into it earlier on they'd still have options now. Not a lot admittedly, but at least some wriggle room.

Maybye the wriggle room is the broadening attack on the states. NSW is now threatening to pull out of the national water plan, saying Canberra was reneging on its commitments for water buy-outs if Victoria did not sign up to the national plan.

Or things are just falling apart. Even Tasmanian Liberal senator Stephen Parry criticised Howard's Davenport Mercey hospital intervention to try to save the seat of Braddon as a "disaster." Burnie, also has a hospital in the area and, presumably, this hospital could suffer or even fold as a result of Howard's intervention to upgrade the Mersey.

The northern part of Tasmania cannot afford two main hospitals.

Les,
Okay council amalgamation is deeply unpopular in Queensland in the bush but many,can appreciate that these are needed efficiencies that won’t happen otherwise. So it seems that state governments trying to lift the game of local councils and make unpopular but necessary decisions,

Okay Beattie is heavy handed in this:---like Kennett in Victoria in the 1990s. Howard's performance in Question Time was a clear and cleverly orchestrated rave from start to finish as you suggest. And Queensland is electorally crucial. So it is all about election politics, isn't it.

However, it is unclear how Howard's intervention to embarrass Beattie impacts negatively on Rudd. Rudd has long supported voluntary amalgamations, and it is Beattie, not Rudd, who is responsible for the council amalgamations.

It is unclear to me how this kind of conflict -in the form of an assault on Kevin Rudd's policy of co-operative federalism--is going to work. Howard picking fights with the states has a negative look. Rudd, in contrast, looks as if he is willing to work with others to get the reform job done.

So what is the payoff for Howard? Holding the battlers within his camp in a marginal seat? Trying to paint Rudd as weak? What's your take?

Lyn,
maybe the economy isn't everything?

If so, then a reason the Howard Government is consistently so far behind in the polls (the figures have been the same for months) -- when the economy's doing better than it's ever been, is that other things are of concern to voters as well as the economy.

For instance: they have worn out their welcome and there is more to life than economics.

Les,

Bit harsh on the Elvis impersonator. I'm seriously considering voting for him next time. Given the choice between useless and useless but amusing, you might as well laugh your way into bedlam.

Gary,

I think you're right on the amalgamation thing. Beattie is the original personality politician and, as such, has drawn all the fire over the councils thing. I can't see it translating into a negative for Rudd in Qld.

Also, I suspect the amalgamations are drawing a lot of people who otherwise have no interest in politics. Beattie is the only name they know. Apparently a lot of the submissions against the proposal said things like "we don't want it, yours faithfully etc"

"Things are just falling apart" might not be the sort of conclusion we're used to seeing from political analysis, but that doesn't mean it's not true.

Gary, I see the gain for the National party in the amalgamation issue. Beattie is already hated and a few more wont bother him. There will be some guilt by association rub off on Rudd but it wont knock him off the perch just make the perch a little thinner. Lots will be made the same thing happening in the other states councils too to make it a federal issue. Labor will undoubtedly negate this sort of scare mongering by having the state premiers appear to back down on other minor issues in favor of Rudd's plan. This will be all very theatrical but it will look like Rudd is cracking the whip.
The time for painting Rudd weak in comparison to Howard is gone. It is now "Kill the roots to kill the tree" time.

Les,
I see that a Paul Williams in the Brisbane Courier says:

State Parliament resumes next week and Government members best gird their loins for what should be the most vitriolic Opposition attack since the last election.And it won't just be the Nationals defending tiny remote communities. It'll also be Liberal MPs cranky about a transformed Sunshine Coast.This suggests a sincere and genuinely united assault on the Government is coming.

But, away from the emotion, a cool look at where state and local authorities intersect shows little evidence of the amalgamations having any huge impact on Labor's fortunes.

Williams then adds:

This impact probably will be felt over the longer term – a type of "slow burn" – as forced amalgamations come to symbolise Labor's out-of-touch arrogance.Given the hostility, propelled by television and newspaper advertisements opposing amalgamation, this issue could easily become a lightning rod for all sorts of dissatisfaction, galvanising communities that, until now, have had little in common.

We've seen "slow burn" issues bring down governments before: Wayne Goss and "that road", Jeff Kennett and "the bush", and Nick Greiner and north coast development.

The op-ed is all about Beattie labor.

Lyn,
maybe the "Things are just falling apart" is not quite right. It's more a case of the Howard Government being battered by a series of blows and retreating to defendable ground--we run budget surpluses. Labor runs a deficit.

You cannot get more basic than that.

Gary,

I was thinking of the Howard Government's "things" rather than "things" generally. Everything they've thrown at Rudd so far has involved some kind of blowback, rarely from Labor.

Overall though, I think the biggest thing is that Howard's things are all negative, scary and big, but Kev's things are all positive, shiny and graspable. Shallow as that seems, I'm sticking with it for the meantime.