ABSTRACT
The brooding leadership struggle between Bob Hawke and Paul Keating reached its final chapter in 1991. Keating was by then the Deputy Prime Minister and Hawke's heir apparent. Keating's term as Prime Minister heralded in a period of expansionary fiscal policy and substantial increases in standing appropriations. When Keating seized the leadership, the government had around 16 months left before an election. Labor was so unpopular in the polls that re-election seemed impossible. The One Nation statement was released in February 1992. It was intended as a top-down strategy based on a moderate fiscal stimulus and tax cuts while at the same time extending micro-economic reform—a strategy began after 1987 by the third Hawke government. Within the space of a few years Labor's carefully established reputation as parsimonious managers of the public purse had been jettisoned in favour of substantial increases in spending programs and deficit financing.
