Decades later, boomers and their investment properties have kept the bubble floating high but in 1987 political pressures generated by the tight Sydney rental market and the proximity of the NSW state election were factors in the change of mind. Mr Keating acknowledged there would be problems. "The negative gearing measure was introduced (in 1985) as part of the government's tax reform package, in order to reduce tax sheltering opportunities in the rental property area," he said in a submission. "Abolition of negative gearing rules will be criticised by those concerned at reopening this tax shelter. Abolition of depreciation deductions will be criticised by property investors and unit trusts." However Mr Keating had other things on his mind.

Cabinet documents for the years 1986 and 1987, released by the National Archives of Australia today, reveal how heavily economic policy was dominated by the balance of payments crisis. Historian Jim Stokes said the crisis had been intensified by the treasurer's comment in May 1986 that, economically, Australia was "done for" and would become "a banana republic"; the plunge of the Australian dollar, which fell to around $US60c in the second half of the year; and the stock market crash of October 1987. On May 28, 1986, Mr Keating warned cabinet that import prices were increasing faster than export prices and the 1985-86 current account deficit was likely to be around 5.8 per cent of GDP, compared with Australia's historic average of between 2 and 3 per cent of GDP. Imports were expected to fall as domestic demand slowed and the value of the dollar fell, but this would be offset by weak export prices and the cost of financing the existing current account deficit. The balance of payments crisis was precipitated by a collapse in Australia's terms of trade, with prices for agricultural and mineral exports falling sharply in relation to prices for manufactured imports. Gareth Evans, who was minister for resources and energy and minister for transport and communications over the period, said the government was one of Labor's best, with a hallmark of not shirking from difficult decisions.

"This was not a government that went around with a wet finger in the air," he told a briefing at the National Archives last month. "This wasn't a government that listens to the focus groups and said, 'Oh, Christ we can't do this ... da-da da-da ... this was a government that could actually recognise, OK we've got a problem with the electorate, OK what do we do about it; no we haven't got it wrong, we got it right ... this is what the country has got to do to get into shape for the future." Professor Evans recalled Mr Keating's capacity to communicate to the media and the public as "hugely important during this period because over and over again it was necessary to explain why we had to get rid of this sclerosis". Bob Hawke fought an election in 1987 against a moribund opposition led by John Howard and white-anted by Joh Bjelke-Petersen. Dr Stokes thought both sides of politics in the mid-1980s were struggling with the gradual breakdown of the old Australia of highly protected industries, rigidly centralised wages and industrial relations systems, and direct government ownership or control of many areas of the economy.

"However, the nation's views on this challenge were complex. At either end of the debate there were vocal advocates either for swift and radical change or for a determined preservation of the old order. Between these extremes, the bulk of the population worried about inflation, high interest rates, declining real wages, the threat of unemployment and, more generally, a diminution of the old certainties of life." In July 1986, Mr Keating told cabinet that tax reform and other measures had already added massively to business costs. If Australians were to face up to living within their means, further revenue measures would have to fall largely on household incomes and public and private consumption. Cabinet agreed on a range of new revenue measures, including deferring personal income tax cuts for three months, increasing the bank accounts debit tax and the sales tax on luxury motor vehicles, advancing company tax payments, increasing the Medicare levy by 0.25 per cent, and increasing the sales tax on alcoholic wine and cider from 10 to 20 per cent. Cabinet also deferred pension adjustments and tightened unemployment benefits, reformed the Pharmaceutical Benefits Scheme, increased the Medicare rebate ceiling, reduced the private hospital bed-day subsidy, substantially reduced foreign aid, and introduced a $250 administration charge for tertiary students. In September 1986, Moody's credit rating agency reduced the Commonwealth government's rating from AAA to AA1, but by February 1987 Mr Keating felt able to tell cabinet that the government's strategies were producing results: domestic demand had slowed, employment had continued to grow and the current account deficit had shown signs of improvement. Calling a spade a spade (and other choice words)

Gareth Evans said the rivalry between Bob Hawke and Paul Keating had not overtly surfaced by 1986-87, the middle period of one of the longest-running and more highly regarded governments in Commonwealth political history. Professor Evans, who is now an academic, made copious diary notes of his period in cabinet and recalled that in many ways, the prime minister always seemed to prevail. He said his notes, unlike the National Archive records, really captured the flavour of cabinet discussion. Or not. In June 1986, Mr Hawke was due to make a television speech hosing down Mr Keating’s ‘‘banana republic’’ comments and Professor Evans recalled the prime minister keeping his cabinet colleagues waiting until 10pm and only giving them a few minutes to read the draft.

Professor Evans told a briefing at the National Archives that they objected to having so little time. ‘‘He snarled irritably that he wasn’t in the habit of having his speeches vetted by a cabinet minister or anybody else. ‘‘We scanned the text for about four or five minutes, time enough to develop a rather sinking feeling that the content was not quite up to the expectations. ‘‘Hawke laid it on the line to finish by 11 ... I found it, as usual, impossible to suppress my dissatisfaction, so I said I was unsatisfied with being presented with a fait accompli and added ‘it wasn’t unreasonable to give your cabinet an hour to look at something like this, especially when you’ve been meeting factional leaders since 8 o’clock'. ‘‘Hawke snapped back at me: ‘I had no such meeting.’

‘‘Me: ‘Yes you had such a meeting.’ ‘‘Hawke, rather losing it: ‘Scheduled, yes. But held, no. So up you for the f---ing rent’.’’ Professor Evans painted Mr Keating’s four-letter way with words too. One morning the treasurer walked into cabinet and his colleagues were discussing an item on ABC radio. Professor Evans said his diary records Keating saying, ‘‘Listen, when you buggers are all tuning into AM at 8 o’clock I’m listening to golden oldies on 2CA. You can’t have C-word-plural filling your minds up with shit at that hour of the morning’.

‘‘Everyone, as usual, fell about,’’ Professor Evans said. About the cabinet papers The cabinet records released January 1, 2014, are those created by the Hawke cabinets during 1986 and 1987. Changes to the Archives Act 1983 in May 2010 began a process of shifting the open access period to 20 years instead of the previous 30-year period, phased in over 10 years. This has resulted in two years of records reaching the open access period each year until 2020. Some 6000 records - including submissions, memoranda and decisions – are available. Loading

A small quantity of material contained in the cabinet records has been withheld from public access. They deal many with intelligence, foreign affairs and trade issues. Cabinet records release Cabinet records for 1986 and 1987 held by the National Archives of Australia became eligible for access from January 1, 2014. Information about the cabinet records, lists of the documents and copies of key cabinet documents, including all publicly released submissions and decisions, are available on the Archives’ website (naa.gov.au). Click on the ‘‘Collection’’ tab, then ‘‘Popular research topics’’, then ‘‘Cabinet’’.Requests for access to records not already released may be made via RecordSearch on the Archives’ website, or by emailing ref@naa.gov.au.