KEY POINTS:
Top of Australian Prime Minister John Howard's agenda for his meeting with his state premiers on Friday was climate change.
Worms turn when the weather turns bad - and the weather has turned bad.
First, a drought so dire that parched Australians are attributing it at least partly to climate change. Howard has a grand water plan.
Second, votes. Labor leader Kevin Rudd's honeymoon is long ecstasy for his party. To stave off regime and generation change, Howard has to sterilise issues on which Labor has the inside running. Climate change is such an issue, for now.
We abolished provinces 130 years ago, so are detached observers of that federal v states game. Also, we have rain. But the federal v states game is also our game.
Since federation in 1900, powers and functions have gradually been transferred - in the interests of efficient administration and national consistency - from the state capitals to Canberra. Incompatible state laws have been harmonised. In the Howard era that has included national GST instead of sales taxes, labour law and, now, water policy.
This matters here because we are very nearly an economic state of Australasia. New Zealand business needs the same rules in Australia as Australian business has. The borders between New Zealand and Australia and its states need to be as thin as the borders between states.
Tariffs have gone. The borders that matter now are the differences in regulatory and tax regimes between the states and between the countries.
A great many of the interstate differences have been ironed out. But enough remain to have filled half a thick report by a federal parliamentary committee. The other half dealt with transtasman differences.
Among its recommendations was an endorsement of demands by Telstra to the committee for transtasman harmonisation of telecommunications regulation so it could compete better here.
With Communications Minister David Cunliffe going down his own telecoms track - which may see taxpayers unwilling owners of the local loop - Wellington ears are likely to be deaf to Telstra's bid.
But, since it came up at the first meeting of the Australia New Zealand Leadership Forum in 2004, and because Telstra is pushing hard, it may well resurface in Sydney next week.
Consumer law reform is also on both countries' agendas and it makes sense to align the two regimes at the same time as Australia tries to rationalise, and maybe harmonise, the myriad and often conflicting state consumer laws.
Separate, disjointed lawmaking is not the way to the vaunted single economic market (SEM) encompassing the two countries. Generally, more effort is being made by each country to take the other into account.
But, as the mishandled attempt to set up a joint therapeutic products regulatory agency (TPA) shows, the single economic market path is not yet adequately signposted.
So officials have been developing a "framework" containing a "roadmap" to inject consistency and rigour into the single market process.
The framework is intended to be a checklist for officials and politicians starting out to reform business-related law or regulatory systems in one country (check if it is relevant to talk to the other country) or to align the two systems (ask which model, ranging from joint agencies through mutual recognition to unilateral alignment to joint industry advisory bodies, will best achieve the objective).
The roadmap sets out criteria for selecting the most appropriate mechanism for harmonisation, co-ordination or co-operation.
It draws lessons from past wrong turnings or difficulties and spells out the need for awareness of political realities in each country and the high importance of international competitiveness with third countries.
It emphasises the need for clearly defined objectives and having the right people at the table at every point.
That requires a whole-of government effort, not just specialist ministries.
This is more likely to work well if people outside the Governments demand it.
That is where the leadership forum comes in. The forum doesn't make decisions and, being still new, can't point yet to many pegs in the ground.
But there have been some small pegs, mainly from its working parties on business-related matters.
Ministers pay it increasing attention as an single economic market sounding-board and as a unified constituency for doing things jointly.
We separate and different. We are wet and they are dry. But we also share much, and that includes an economy, legal systems and much of the high and popular arts.
Shared interests is the forum's focus. Leaving management of our deep entanglement hostage to politicians who blow hot and cold is not an optimal recipe.
The states know that. We need to know it, too.
