Beyond the deals that will be needed to form Australia’s next government, the outcome of this federal election will be determined by a wildcard influence from outside our politics – the Trump presidency

There was a time when the leaders of Australia’s Labor and Liberal parties refused to entertain the question of minority government, and no one seemed to mind. It was just about the final taboo in our politics, and it relied on the assumption that Australians crave stability above all else. To entertain the possibility of a hung parliament was to concede two disempowering things at once: that your side couldn’t win in its own right, and that you accepted the competing mandates of third parties and independents. Acknowledging a role for the crossbench in deciding who runs this country risked giving voters permission to punish both major parties.

The fact that Opposition Leader Peter Dutton, not Prime Minister Anthony Albanese, chose to break the taboo underlines the unique nature of the 2025 campaign. Buoyed by a cluster of favourable opinion polls released early in the new year, Dutton nominated both the minimum number of seats that would permit him to lead the nation (71 or 72 in a parliament of 150) and a shortlist of crossbench MPs he’d be prepared to deal with: Queensland’s Bob Katter, a veteran of the last hung parliament in 2010; Dai Le, who took the western Sydney seat of Fowler from Labor at the last election; and Allegra Spender, the independent regarded by Labor people as the “rock star” of the crossbench.

“It would be unusual,” Dutton told Sky News in February, “that if we were able to achieve 72 and we were a number of seats ahead of the Labor Party, that there wouldn’t be a guarantee of supply and confidence from the crossbench.”

He also identified the “Green teals” (his label) from whom he did not expect support: Kate Chaney, Zoe Daniel and Monique Ryan. All three won previously safe Liberal seats, in Perth and Melbourne, as independents. Either Dutton thinks these particular seats will return to the conservative fold or, if they don’t, he wouldn’t need them in the event of a hung parliament.

Imagine then Liberal leader Tony Abbott taking this approach to the 2010 campaign, measuring only some of the curtains in the Lodge, and leaving the rest in the hands of his preferred independents? He would have been mocked for both his arrogance and passivity. When Julia Gillard formed a minority Labor government after that election, Abbott declared it “illegitimate”. He spent every working day as opposition leader in the 43rd parliament demanding that she call a snap election to end the chaos. Now, it seems, a government that relies on a formal or informal alliance with independents is no longer a threat to democracy, provided it is the Liberals and Nationals who are in charge.

Dutton was lowering the bar of expectation so he could clear it. The Coalition’s internal polling showed a collapse in Labor’s support. Remarkably, a narrow Coalition majority was within reach, based on the numbers at the time.

Yet the possibility of government changing hands after a single term feels anomalous. Labor hasn’t been that bad in office, while the Coalition regime that preceded it was one of the least effective in our history. Is three years in the sin-bin of opposition sufficient to make a Dutton government superior to the Albanese government it replaces, and the Abbott-Turnbull-Morrison government that preceded it? Especially when Dutton has shown so little interest in formulating, and explaining, policy?

The past offers no comfort on this question. The Coalition governments that achieved an early return to power – Malcolm Fraser’s in 1975 after three years in opposition, and Tony Abbott’s in 2013 after six – followed Labor governments that were cursed by global economic shocks. Abbott, like Fraser, presumed the restoration of Australian prosperity would follow as a logical consequence of Coalition rule. Both left the nation even more vulnerable to shocks after a decade each of policy inertia.

Spending exploded under the Whitlam government, but it was Fraser’s taxation and spending policies that ultimately sent the federal budget into deficit. Abbott’s government inherited a deficit from the Rudd-Gillard-Rudd government in 2013 and promised to restore the (mining-assisted) surpluses of the Howard era. The scorecard after nine years in office, and three prime ministers, showed nine deficits and a trebling of net federal government debt. Perversely, the single largest savings measure that the Coalition announced in this period involved an illegal debt recovery system. The purported budget boost of $4.7 billion over four years was illusory. The cost to taxpayers of defending, and ultimately abandoning, the robodebt scheme left the budget $500 million worse off than if the government had done nothing in this area. This cost does not include the money refunded to the many innocent victims of the scheme. While the Coalition punched down on Australia’s most vulnerable people, it lost sight of middle Australia and entrenched the great housing divide between owners and renters.

Now consider national security, where Dutton – as the former minister for home affairs and, later, defence – bears direct responsibility. The Coalition picked an unnecessary fight with China during the pandemic, at significant cost to our exporters, while its slow walk on climate change policy alienated our neighbours in the Pacific just as Beijing was moving to increase its influence in the region.

There was a surreal disconnection between the Coalition’s increasingly hawkish posture towards China (from Malcolm Turnbull’s foreign interference laws in 2018 to Dutton’s pre-election warning in 2022 that Australians should prepare for war) and its failure to secure a new fleet of submarines for our defence. Complacency was multiplied by internal rivalry, as each submarine contract was torn up in the wake of a leadership coup: Abbott’s preferred Japanese bid died when Turnbull replaced him as prime minister in 2015. Turnbull signed a deal with France the following year, which Scott Morrison cancelled before telling Paris in 2021. To be fair to Morrison, his AUKUS agreement with the United States and United Kingdom survived the change to a Labor government. But only time will tell if US President Donald Trump will honour America’s end of the bargain to supply three Virginia-class nuclear-powered subs sometime in the decade. Trump may want to increase the price, in keeping with his goal to rework the global trading and alliance systems to America’s advantage. Or he could conceivably abandon the program because he wants to keep the subs for US defence. Any credit the Coalition wishes to claim on history’s page for stopping the asylum seeker boats must be weighed against the black hole of its submarine policy.

Dutton’s plan for a network of government-owned nuclear reactors repeats the pattern of grandiose but unreliable commitments. He has provided no credible costings or timeline to deliver the scheme. When the CSIRO pointed out that nuclear power will be about 50 per cent more expensive than renewables, Dutton attacked the findings, claiming without evidence that they had been manipulated by Labor’s climate change minister, Chris Bowen.

Let’s be frank: an early return for the Liberal and National parties risks extending Australia’s two-decade-long paralysis on economic, defence and climate policy into the 2030s. But Labor’s problem is that it can’t run on its record. Treasurer Jim Chalmers has already banked two surpluses, but the pre-election budget showed a return to deficit. He can point to the taming of inflation and a record number of new jobs created, but living standards have fallen on Labor’s watch.

Every new government since federation has lost seats in its quest for re-election. But only two governments lost office after a single term. Both happened to be Labor: Andrew Fisher’s government in 1913 and Jim Scullin’s in 1931. What is easy to miss in the recitation of this iron law of national politics is the increasing frequency of one-term governments at the state level. There were four between 1972 and 2012: two in the early 1970s, one in the early 1980s and another in the late 1990s. Since 2014, four state and territory governments have fallen after a single term, and all four were Coalition or Liberal. The turnover coincided with the one-term Liberal prime ministerships of Abbott, Turnbull and Morrison. Defeat for the Albanese government in May would provide one more piece of evidence that our politics has been permanently altered.

Albanese, for his part, won’t entertain hypothetical questions about a hung parliament, other than to rule out any deal with the Greens. He has been carrying himself as if Labor was still in its honeymoon phase, before the interest rate rises and the crushing defeat of the Voice referendum. But Labor reveals its insecurity in the old-school scare campaign it is conducting against Dutton.

The inspiration for the scare campaign, as one senior minister explained, was the Coalition’s relentless targeting of Labor leader Mark Latham’s personality in 2004, when Labor was riding a wave of enthusiasm for change. It was brutal, and often over the top, and John Howard conceded the absence of a fourth-term agenda for his own government by matching Labor’s policies. The attack on Latham’s character had served its purpose once the election was called. Howard framed the choice between the devil they knew and the risky alternative at a time of rising interest rates.

The paradox for Labor is that Howard was chasing a fourth term in a pro-incumbent era, before social media discombobulated the practice of politics. Albanese is seeking a second from a position of structural weakness, in an era of accelerated global shocks that can kill or rescue governments depending on when they strike in the domestic electoral cycle.

That structural weakness begins with Labor’s unconventional entry into office, with a primary vote below 33 per cent, and a narrow majority on the floor of the House of Representatives. There is no buffer to absorb even the smallest swing against the government. The loss of just three seats would send Labor into minority. A repeat of 2010, when the Gillard government ceded nine seats in net terms to the Coalition and two to the crossbench, would leave the parliament hung with 67 Labor, 66 Coalition and 17 on the crossbench. Albanese would require the support of at least nine of those crossbenchers to govern; Dutton 10. And so on. Predicting a hung parliament is the easiest part of this game, especially when seats are expected to change in every direction. It is the composition that matters, and that will be determined in two stages: the performance of the leaders and their respective parties during the campaign, and in the negotiating skills of the leaders after it.

Albanese would be favoured even if Labor started one or two seats behind the Coalition because, unlike Dutton, he has already put in the work to build relationships with each member of the existing crossbench. Dutton yells at the Greens and teals to make himself heard in Sydney’s west and Melbourne’s metropolitan fringe. His appeal to working- and middle-class voters with big mortgages comes with an explicit rejection of voters in the inner cities. A more rounded leader might have found a language to talk to both constituencies. But Dutton is a creature of the Howard era, when the Coalition thrived by exploiting the divisions in Australian society.

The wildcard that can swing the contest in either direction is Donald Trump. The president was barely a fortnight into his new administration in February when Dutton was musing about what minority government would look like for him. Trump had already declared his radical imperial ambition to annex Greenland and Gaza, reclaim the Panama Canal, and subsume Canada, the Commonwealth nation whose centrist politics and resource-rich economic base most resembles our own, as the 51st US state.

To Dutton, Trump’s proposal to remove Gaza’s 2.1 million people and rebuild the Palestinian territory into “the Riviera of the Middle East”, under US ownership, was an example of the president’s negotiating genius. Dutton called it a “perfectly reasonable” ploy to encourage Egypt and Jordan to contribute to the reconstruction.

Trump, Dutton observed, “is a big thinker and a deal maker. He’s not become the president of the United States for a second time by being anything other than shrewd.”

Trump’s second presidency differs from the first in its ability to dominate the global news cycle, and with it the politics of allies and neighbours. He does this by converting the tweet storms of his first term into the hard policies of the second. What were once threats that could be contained by the grown-ups in his administration are now direct attacks on the international order, encouraged by a new generation of cabinet appointees and staffers who serve without question.

No self-respecting leader in a democracy could watch the tag team of Trump and Vice-President J.D. Vance humiliating Ukraine President Volodymyr Zelensky on live television and think, Wow, those Americans are big thinkers, or perhaps console themselves that it was just an act for the cameras.

Even Dutton, who had given Trump a back-slap on Gaza, was not prepared to condone the bullying. He said he would lobby Trump on Ukraine’s behalf.

The Trump factor in our politics is best explored by first understanding the double edge of his record as disrupter and incumbent. Trump won two elections as the challenger by hurling abuse at a female Democrat opponent. But he lost two campaigns from the White House itself, first by ceding congress to the Democrats at the midterm elections in 2018 and then the presidency to Biden in 2020. This detail is often overlooked in the coverage of Trump. His first administration failed to capitalise on the political gift of the pandemic. Trump was the only Western leader of note to lose office during the lockdown years of 2020 and 2021. New Zealand and Canada re-elected their respective centre-left governments during the pro-incumbent phase of the crisis. The five Australian state and territory governments that faced the people in 2020 and 2021 were also returned. Trump’s defeat was the exception to the rule that voters rally around their government during an existential threat.

His resurrection last year reinforced the flipside of that rule, that governments are more likely to fall during a cost-of-living crisis. The US was the fourth Anglo democracy in a row to sack its incumbent following the reopening of the global economy in 2022, after Australia, New Zealand and the United Kingdom.

These cycles are important to bear in mind as the Australian election campaign plays out. Trump is governing this time as an extension of his presidential campaign. He is running against the US public sector at home, through the agency of Elon Musk’s Department of Government Efficiency, while he targets American allies abroad with the pincer of tariffs and demands for increased spending on defence. It is inconceivable that Trump will slow down, let alone reverse his America First program, allowing the Australian people to focus on the choice between Labor, the Coalition parties, or none of the above.

The problem of Trump for our democracy isn’t the white noise of his agenda, or his craving for attention. Australians didn’t carry a mental screenshot of his tweets into the ballot box in 2019. First-term Trump was a sideshow. Second-term Trump threatens our economic and national security directly through his tariff policy.

There is a further distraction coming from Trump’s chronically online lieutenants. Musk and Vance have already advised German voters to support the Alternative for Germany (AfD), a party under surveillance from Germany’s own domestic intelligence service for suspected right-wing extremism. Vance took the additional step of attacking Germany’s cross party agreement to avoid any coalition with the AfD – the so-called firewall against the far-right. “Democracy rests on the sacred principle that the voice of the people matters,” Vance told European leaders at a security conference in Munich in February. “There’s no room for firewalls.” The firewall, for anyone with an elementary knowledge of German history, is designed to prevent a repeat of 1933, when Hitler was invited by the conservative parties to serve as chancellor in a coalition government.

The AfD secured almost 21 per cent of the popular vote to become the second largest party after the centre-right Christian Democratic Union. In Britain, Nigel Farage’s Reform UK party won almost 15 per cent of the vote at last year’s general election.

The constituency for an anti-immigration movement in Australia remains modest by German or British standards. The combined House of Representatives votes for Pauline Hanson’s One Nation and Clive Palmer’s United Australia Party was just over 9 per cent in 2022. Neither party won a seat on the crossbench, although they did claim one spot each in the Senate. The UAP’s vote of 4 per cent cost Palmer $123 million, arguably the most wasteful campaign expenditure in our history. That may not deter Musk and Vance from picking a preferred Australian candidate, especially when Hanson and Palmer have an interest in importing the Trump brand to the margins of Australian politics.

Palmer intends to spend another $90 million in this election, the last before new campaign finance laws come into effect. He says he will be targeting Coalition and teal electorates as well as Labor’s, under a new banner, the Trumpet of Patriots party. Palmer’s argument with the Coalition is that Dutton is not Trumpian enough. Dutton may approve of that message, even if it is meant as an insult, because no Liberal leader can afford to embrace the most visible part of Trump’s domestic agenda: Musk’s chainsaw cuts to government spending. Yet Dutton is still playing a Trump card of sorts with uncosted promises to reduce the size of the bureaucracy, and a ban on working from home for all those public servants who get to keep their jobs.

Dutton and indeed Albanese are old enough to recall the conflicting domestic forces that were unleashed by the previous US Republican president, George W. Bush. The war in Iraq, the single issue that Donald Trump and Barack Obama see through the same lens of American disgrace, cast a shadow over Australia’s 2004 election campaign. A large part of Mark Latham’s initial appeal to his Labor colleagues was his outspoken views on the US president: Bush was the “most incompetent and dangerous president in living memory”, and the Coalition MPs who supported the war in Iraq formed a “conga line of suckholes”.

Australia’s involvement in Iraq was unpopular. But Howard successfully branded Latham’s plan to bring Australian troops home by Christmas as a threat to the US alliance. However, the alliance card could not be played three years later when Howard faced off against the foreign affairs nerd Kevin Rudd. By this stage, Bush was in the lame-duck phase of his presidency. When he flew into Sydney in September 2007 for the APEC leaders’ meeting, Howard cited a diary clash with the Dally M rugby league awards to avoid greeting the leader of the free world at the airport. “I have got to get my priorities right,” Howard explained to journalists. “No disrespect, he [Bush] is my good friend, but this is rugby league.”

Trump in 2025 is Bush at his imperial peak in 2004 plus 25 per cent, which represents the tariff he imposed on our steel and aluminium exports in March. Trump’s decision to deny Australia a repeat of the exemption that Turnbull had negotiated made him an unavoidable part of the coming election. The irony is that Trump has the potential to make Australian politics serious again if he provokes a debate about our place in the world. That debate might even save Labor from itself, if Albanese can make the case for an economic and national security framework that reduces our dependence on a capricious America.

Albanese and Dutton would have observed the dramatic shift in the opinion polls in Canada, after Trump announced across-the-board tariffs of 25 per cent and insisted he was serious about taking over the country.

Canada’s centre-left Liberal Party government was heading for a landslide defeat, in keeping with the anti-incumbent trend since 2022. Justin Trudeau saw the writing on the wall, and surrendered the prime ministership. But his successor, Mark Carney, a former central bank chief in both Canada and the UK, may pull off a miracle victory. Canada’s Conservative Party opposition leader Pierre Poilievre, long seen as the prime minister in waiting, will be cursing Trump, and wishing that Musk had never publicly endorsed him.

The thing to watch for in Australia, as well as Canada, is whether voters perceive a guilt by association for Dutton and Poilievre. If they do, mark the second Trump presidency as a pro-incumbent shock for the nations he declared trade war against.

Dutton remains the frontrunner, but enters the formal campaign without substantial policies, and the spectre of Trump to contend with. He continued to test the Australian appetite for Trump-like gestures even as the polls appeared to be creeping back towards Labor following the tariff shock. Dutton’s proposal for a referendum to allow the Commonwealth to deport criminal dual citizens was pitched into the same mid-March news cycle as the Trump administration’s mass deportation of alleged Venezuelan gang members in defiance of a US court order.

A second Labor term would represent a lucky break for Albanese given how dire the polls have been for his government. Although he would claim any win as vindication for his cautious first-term strategy, he should include a thank you to Trump in his victory speech. It would be the US president who helped frighten swinging voters back to the incumbent.