San Francisco

In the Bob Hawke Labor years through the mid 1980s, Australians became used to hearing the term the "clever country".

For a time, at least, it was a political rallying cry and national vision that had resonance with the Australian electorate. It was also the broad umbrella under which some of the most successful industry policy initiatives of the time, most notably the 150 per cent tax concession on eligible R&D spending, were created.

For the broader electorate, the slogan made sense of business policies that might otherwise have seemed remote, such as the concession. This was crucial in maintaining commitment in the electorate to the task of restructuring the economy.

But the term gradually fell from favour as first the currency crisis of 1987 and then the recession of the early 1990s began to take a grip on the economy. Hard numbers and budget restraint became the order of the day for governments trying to position themselves in the minds of the electorate as the most qualified economic stewards.

Fiscal restrain was a political raison d^etre that reached its apex in the first two budgets of the Coalition Government in 1996 and 1997. By that time, the credibility of the R&D tax concession had been irreversibly damaged by syndicates that owed their existence more to a desire by financial engineers to minimise tax than to a genuine commitment to research.

Still, when the new Government cut the concession to 125 per cent, it sent an unintended message that still reverberates through the Australian business and research community. The clever country, in the words of one magazine cover at the time, was dead.

In 2000, the Internet has so revolutionised the use of information in the business community that no industry is untouched, and most are clearly only in the first stages of their transformation. It is also creating a whole raft of social challenges, felt nowhere more sharply than in the US, the nation most advanced on the pathway to the New Economy.

As the US enters a presidential election campaign, both of the candidates, George W Bush and Vice President Al Gore, have no choice but to pay special heed to the information industries. For one thing, these companies are now the richest in the world, and dominate the most populous and wealthy state in the US, California.

But the information revolution is also presenting the most important policy challenges for the next four years.

What has become known as the Digital Divide – inequality of access to the basic tools of future economic activity (see related article Bandwidth: an industry policy issue) – cannot be ignored, either from a social or economic perspective. Gore has promised that he will seek to wipe out the divide in his first term, if elected.

In Australia, Labor's industry spokesman Bob McMullan has indicated that Labor believes it can build its election strategy on presenting itself as the most aware party when it comes to the challenges of the information revolution. Expect to hear a lot about the "knowledge nation" from the Labor frontbench over the course of the next year. It is the successor to the "clever country" slogan of the past decade. See related article:The Bob McMullan interview

For the Coalition, meanwhile, there is still the monkey of the 1996 and 1997 budgets to be removed from its back. With the issue of credibility when it comes to the information revolution already shaping as a core differentiator for the Opposition, the Government might have no choice but to attempt to go one better in integrating information policy into its business and social platforms.

For the first time, this means that the information revolution will not be a battle field between the parties for the hearts and minds of the information industries alone. It means its importance can be expected to be reflected in every aspect of business policies, from sector specific support to workplace training. Any Australian politicians who don't understand that already will have the point driven home by the debates in the US presidential campaigns.

The past five years have seen a turning point in the business world often compared to the industrial revolution, thanks to the Internet. The next election campaign will be a turning point on the political landscape of Australia. The first election in which the Internet is recognised as the platform of future economic and social wellbeing.