But as the pandemic inches towards its two-year anniversary, any warm feelings are but a distant memory. Today might be Australia Day, but the mood isn’t one of celebration. Australia is having a bad summer, and Australians are angry with their governments, especially the federal government led by Prime Minister Scott Morrison.

A few months ago, the Morrison government looked as though it would cruise back to power in the upcoming federal election, which must be held by May this year. This month, however, the Opposition Labor Party’s primary vote climbed past the Coalition’s for the first time ever. Morrison may still be leading Opposition leader Anthony Albanese as preferred Prime Minister by 7%, but he had a 23% lead in August. The trend is clear.

The immediate cause for the government’s political woes is the acute shortage of rapid antigen tests (RATs) across Australia. Although the federal and most state governments were right to shift to a ‘living with Covid’ approach late last year, they failed to anticipate the entirely predictable surge in demand for testing as society opened up and the highly transmissible Omicron variant took hold.

To manage mounting pressure on testing and supply chains, the National Cabinet, with the notable exception of Western Australia, agreed to redefine ‘close contact’ more narrowly, reduce the required period of isolation for positive cases, and permit the use of RATs instead of only relying on PCR tests. However, having failed to stock up on RATs, test kits rapidly ran out and could not be found for love or money. Actually, that’s not quite right. The small number of RATs that could be found cost a lot of money — in one case $500 for two tests.

What followed was immense public confusion and consternation, as well as crippling staff absences, since negative test results are necessary for ending mandatory isolation and international arrivals. The federal government responded by washing its hands of the problem, only providing free kits to six million low-income earners, and blaming state and territory governments since testing is their purview. In return, the states blame the federal government for failing to ensure a reliable supply of RATs to the country.

Yet behind these problems lies a more profound political failure: the Government’s inability to explain Australia’s almost overnight decision to drop its ‘Zero Covid’ approach. For almost two years, Australians were told that they should avoid Covid at all costs; today, they are accommodating very high daily case numbers with minimal restrictions.

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Given Australia’s very high rates of vaccination and Omicron’s milder symptoms, this is arguably the right approach. Nonetheless, Australian leaders and public health officials, with few notable exceptions such as Queensland’s Chief Health Officer John Gerrard, have failed to make a sustained case for the new strategy publicly. And that has left many Australians concerned and confused, wondering if the Government is just winging it.

So rattled is the Prime Minister by his rapidly declining popularity that he attempted to distract from these problems by using the oldest trick in the Australian political playbook — looking tough on borders. Yet even the detention and subsequent deportation of Novak Djokovic has failed to revive his political fortunes, instead turning into a prolonged farce that made the federal government look even more useless.

So far, Australia’s anger has mainly been directed at Prime Minister Scott Morrison. And most of it is justified: Morrison’s incompetence, preference for soundbites over substance, and propensity to shirk responsibility have meant that Australia suffered from a leadership vacuum in the middle of one of the worst crises in its history.

But the dysfunction runs much deeper. Indeed, the problems exposed during Australia’s summer of discontent are symptomatic of the country’s entire pandemic response — but they can no longer be papered over by lockdowns. At the root of the problem are changes to the Australian state that began decades ago and whose negative impacts have finally come home to roost. Having set out to create a state that is less responsive to popular demands, Australia’s political elites have ended up creating a state that is incapable of addressing serious crises.

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Australia went through a deep political and economic crisis in the Seventies, which, at the time, political elites attributed to unrealistic popular expectations from an overburdened state. In response, from the Eighties, both centre-Left and Right-wing governments sought to dismantle the Keynesian compromise that underpinned a relatively equitable distribution of income. Although justified in terms of efficiency, rationalisation and competitiveness, the main purpose of Australia’s neoliberal transition over subsequent decades has been to reduce the state’s responsiveness to society.

Policymaking and implementation processes increasingly transformed the Weberian ‘command-and-control’ structures of the post-World War II state into a diffuse array of quasi-independent agencies, both public and private, loosely coordinated by the central government. State capacity was hollowed out, while fragmentation impeded central agencies’ capacity for direct action, and blurred lines of control and accountability. This was a design feature, not a bug of the emerging Australian regulatory state. Having shed direct control, political leaders could claim plausible deniability over policy decisions and their outcomes in many areas.

Federalism has only made these problems worse, routinely hampering Australia’s response to the pandemic and generating an endless blame game between the federal and state governments. Just like the federal government, state and territory governments’ capacity has also been hollowed out. They have also struggled with federally imposed budget austerity, weakening their capacity to deliver important public functions, such as health.

All of which made it impossible to coordinate a national response to the pandemic. States and territories have often acted as independent countries, paying little attention to the federal government and to each other. They have exercised unilateral discretion over state borders and even over the international border via their hotel quarantine systems. Even now, Western Australia alone remains committed to a Covid elimination strategy and is yet to reopen its borders to other states.

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In this context, Morrison’s incompetence is far from unusual — it is inherent to the kind of state Australia has. But even a leader keen to take control during the crisis would have struggled to get things done because of the very significant constraints on top-down direction in the Australian state.

And so Australia’s reckoning with its real pandemic record must extend beyond dissatisfaction with the performance of its current political leaders. Unless state structures change to become more responsive to elected leaders, and through them to the wider public, the same pathologies will continue to reappear. Australia has paid a high price for its dysfunctional state during this crisis, but it could be much higher in the next.

Thousands of Australian citizens remain stranded abroad, unable to return due to strict caps on spots in hotel quarantine, which are set by state governments. Frequent domestic border closures — also decided by state governments — have effectively fragmented Australia into eight separate countries. Last month, Australians were treated to the surreal spectacle of the Australian Defence Force patrolling the border between Queensland and New South Wales.

Across the country, citizens have discovered that reserve powers are largely the prerogative of state governments, and are being exercised in ways that routinely exclude other states’ residents, as if they were foreign nationals. For example, Western Australia now requires that people living in New South Wales have at least one shot of the Covid vaccine to enter the state. In one of the most callous examples of exclusionary state politics in practice, last year the Queensland government denied a 14-year-old double-lung transplant patient from NSW access to his specialist doctor, declaring that Queensland hospitals were for Queenslanders.

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Indeed, throughout the pandemic, it seems that states’ rights have trumped citizens’ rights — while at the same time reducing federal government to a feckless bystander.

How quickly things change. Few would have predicted that the Australian federation would suffer from such deep fragmentation before the pandemic. After all, the trend for decades had gone in exactly the opposite direction, towards greater centralisation of power at the federal level. Australia’s federalism was long viewed by political scientists as one of the world’s most “vertically imbalanced”; the Commonwealth has controlled around 80% of tax revenue since World War II, making Australia’s states reliant on federal transfers for half their budgets.

Federal governments used this leverage to introduce greater controls over how the states spend their money, by introducing a host of national schemes that promised funding to the states which agreed to undertake reforms. In some cases, such as in the National Disability Insurance Scheme initiated in 2013, states were relieved of their responsibility for disability care altogether, in favour of private and non-profit service-providers.

But when the pandemic struck in March 2020, state governments moved swiftly into the driver’s seat. Harnessing emergency powers few realised they possessed, they imposed society-wide lockdowns and closed internal borders. Although the constitution accords responsibility over quarantine and international borders to the federal government, lack of federal preparedness saw state governments assume full control over the hotel quarantine system, which was hastily established over one weekend. Since hotel quarantine capacity determines the number of weekly international arrivals into Australia, the states in effect have de facto control over international borders.

Initially, many were thrilled to see state governments taking strong action, especially as Prime Minister Scott Morrison was slow to act in the face of the pandemic. And premiers have been rewarded for this by remarkable levels of popular support, especially when they succeeded in keeping Covid out of their states. The Queensland Premier, Annastacia Palaszczuk, and Western Australian Premier, Mark McGowan, were both easily returned to government in their respective state elections. In McGowan’s case, re-election was secured by a margin rarely observed in free and fair democratic polls.

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Morrison, meanwhile, despite initially enjoying high levels of public approval, has seen his popularity plunge to negative territory, as lockdowns and border closures sparked by the Delta variant have again handed the initiative to the states. Aware of the potential for incoherence and discord within the federation, he established a National Cabinet in March last year as a platform for federal and state leaders to coordinate policy directly. The National Cabinet was initially heralded a success, with the nationally coordinated lockdown of March-May 2020 eliminating community transmission in Australia. However, beneath the veneer of cooperation, there was squabbling and petty tribalism.

There were, for example, no national standards developed, so each state designed its own hotel quarantine system differently. When these systems failed, rather than learn from each other’s mistakes, states preferred to take pot shots at each other about whose Covid response was best.

The repercussions of this petulance soon became clear. In Melbourne, the capital of Victoria, poorly trained and precariously employed security guards caught Covid from returned travellers and then spread it in the community, sparking the state’s second wave last winter, resulting in more than 19,000 cases and 800 deaths, as well as a 112-day lockdown.

Victoria tried to redress these problems by establishing a centralised agency for managing hotel quarantine, but in June a leak from NSW sparked another wave of infections, which spread to other states and even New Zealand, resulting in more lockdowns. The outbreak was caused by an unvaccinated driver without the correct PPE transporting airline crew from the airport to the quarantine hotel. While NSW requires all drivers to be vaccinated and wear a mask, compliance and enforcement was left to the private transport companies. Once again, the failure to learn from best practice in other parts of the country had disastrous consequences.

As the pandemic has worn on, these skirmishes have erupted into open warfare, exacerbating the formidable challenge of developing and implementing an exit strategy from lockdown. Take the federal government’s recently proposed four-phase plan for reopening borders and ending restrictions. Based on Doherty Institute modelling, it anticipates reopening to be safe enough when 80% of the eligible adult population are fully vaccinated. Although initially approved in National Cabinet, some states almost immediately began to pull away.

The was mainly due to the emergence of two Australias. The first, which includes the two most populous states, New South Wales and Victoria, has suffered major outbreaks and long lockdowns. Consequently, they have abandoned “Zero Covid” strategies and accepted that reopening will involve some risk of the virus’ spread and mortalities.

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The second group, however, led by Queensland and WA, has so far managed to avoid major outbreaks thanks to border closures and snap lockdowns. Although indicating basic support for vaccination as a way out of isolation, their premiers have nonetheless repeatedly raised the threshold for reopening beyond the figures suggested in the Doherty model.

Palaszczuk, for example, recently argued that reopening should only occur after children younger than 12 were vaccinated. This is despite the fact that no country in the world has vaccinated under-12s, no vaccines are currently approved for this age group and their risk of serious illness is vanishingly low. Yet McGowan concurred, and wondered aloud why the federal government would want to “infect” WA. Although Palaszczuk backtracked a few days later, it is clear that reopening Australia, internally and internationally, will be fraught and challenged at every step, and finding a unified position among the federal and state governments will be difficult, if not impossible.

Australia’s federation is thus facing one of the biggest challenges in its history. Australia’s hodgepodge of state-based systems and responses, combined with endless acrimony and buck-passing, contrasts poorly with New Zealand’s more coherent “whole-of-government” approach, even though both countries are effectively following the same elimination strategy. If there’s one lesson for Australia in the past eighteen months, it’s surely that a greater consolidation of powers within the federal government is necessary for ensuring a unified, efficient and effective national response.

Ironically, however, it is likely this crisis will likely have the opposite effect, further entrenching the fragmentation of Australia’s federation, guaranteeing the same problems will recur in future crises. For state governments and their residents will not forget where reserve powers are truly located, and that they may be exercised with little regard for national agendas or citizenship rights.

In the absence of constitutional reform or some other change within Australian federalism, the temptation in future crises will always be for states to go it alone. So, what is the point of Australia? With 54% of WA residents in a recent survey declaring themselves “Western Australians” first rather than Australians, perhaps it is time we stop taking the answer for granted.