LEIGH SALES, PRESENTER: The former Prime Minister Paul Keating has just released a book, an extensive collection of post-Lodge speeches covering everything from music to nuclear weapons to the future of the Labor Party.

We'd need hours to explore the ideas comprehensively, but Mr Keating is with me in the Sydney studio tonight and we'll do the best we can in the time available.

PAUL KEATING, FORMER PRIME MINISTER: (Inaudible).

LEIGH SALES: G'day. Mr Keating, I wanted to start by talking about political leadership. You write in the book that leadership is the job of interpreting the future to the present. What do you mean and do you see many examples of that in contemporary politics?

PAUL KEATING: Well, I think that - I think leadership's always been about two main things: imagination and courage. Imagination to divine a bigger schematic, a bigger world, and then having the political equipment to get the changes through. And sticking with them. I think - and a conscientious public, and I think the Australian public is conscientious, pick up a storyline pretty quickly. And they know whether they're getting value or not. And if they think they're getting value, they'll stick with you.

LEIGH SALES: Well at the moment, they seem to not think that they're getting value from either side.

PAUL KEATING: That's what they think. I'm pretty sure of that. It gets back to where we are. I mean, the - Australia's a country in transition. The seminal event of our time is the return of China to a position of primacy in the international system, back to where it was before the Industrial Revolution. This is gonna change the way the world works, but not just the world, our part of the world. And so therefore, our economy, our society, our cultural attitudes, the psychology with which we approach the region, all this, I believe, is the overarching story of the modern Australia.

LEIGH SALES: And are our current leaders showing the imagination and courage that's required, do you think?

PAUL KEATING: Well I think that the Government is conscious of this. Kevin Rudd's been talking about an Asia-Pacific community for a long time. The Prime Minister raised these matters - material too in the G20. It's a matter of knitting the story together. You know, seeing all of these things like carbon abatement, the mining tax not just shooting stars, but part of an engaging, overall, compelling story.

LEIGH SALES: In that first answer that you gave, you were talking very much about being able to sell the public on big picture issues. I had the former Finance Minister Lindsay Tanner on the program earlier this year and he said something to the effect of that it's very hard for governments to introduce big reforms these days because of the nature of the media reporting cycle and the sort of 'gotcha' coverage that exists of politics. What do you think of that argument?

PAUL KEATING: It's definitely got harder, but I think the big storyline, that is, a government with a very clear idea about what it's doing and with a big rolling idea will always overcome the static. The static is in part a consequence of the fact there isn't the carriage of big ideas around. You know, when something fills in the available space, it's now political - it's media noise, which comes in all shapes and forms, including social media, the internet and everything else. But I think there is nothing - there is no substitute for a compelling story of the country, of its future. And I think if the Government's able to pull those kinds of threads together from a tremendously good base, both economically, socially, etc., then you could see that position change.

LEIGH SALES: OK, so why are they not then currently pulling those threads together and making that case? Because I seem to remember you saying years ago that the Government needed a compelling narrative?

PAUL KEATING: Well, it's all about telling the stories. You gotta be able to tell the stories, I think.

LEIGH SALES: And why can't they?

PAUL KEATING: Um, well, it's called political skilling. Pure and simple.

LEIGH SALES: They don't have enough of it?

PAUL KEATING: Don't have enough of it.

LEIGH SALES: And who's at fault for that?

PAUL KEATING: Well, it's maybe the way people develop in the system today. See, you know, I joined the Labor Party at 15. I was president of the youth council when I was sort of 20, you know. I'd been at it all my life. And you get to a point where, you know, for a part of your life, the political system is about progress for you, but after a certain point, for the conscientious mind, it's progress for the country. And I think once that gear changes, then the story - the story enlargement becomes a real possibility and you get better at it.

LEIGH SALES: So, are you saying - because people'll be trying to read between the lines of what you're saying - are you saying that Julia Gillard doesn't have a big enough sense of her vision for the nation?

PAUL KEATING: Look, I don't wanna be scoring, marking, subtracting, dividing Julia Gillard, you know. There's plenty of things to talk about in the book. Get it open. But the fact is that in - with the static of the modern society, I still believe the country's always looking for value. People are listening for value. And if you can get the storyline running - but it's gotta be real. It can't be made up. It can't be done by the pollsters. It's gotta be your story. You gotta think about these matters yourself. It's not gonna come in a briefing note. It's not gonna come from the Treasury. It's gonna come from the Prime Minister's department. It has to be conceived in your head.

LEIGH SALES: On that point about the public always looking for value - because I have opened the book - you've written in there that ...

PAUL KEATING: Just keeping you in line.

LEIGH SALES: (Laughs). You've written in there that political leaders should give the public a real break by telling them how things really are; that when the public isn't let in on the problem, the political system treats them like fools. Are the public being treated by - like fools on too many issues? And the issue I'm thinking about is asylum seekers.

PAUL KEATING: Well, let me say this: I've said this often, but when they were handing out continents, not many people got one. We did. We got a continent of our one, unbelievably. 20 million of us. We've got the great event of our time: the re-advent of China in its international guise. You know, the change from West to East in the world. This year, 66 per cent of world growth will come from the developing countries. A decade ago, that was 25. That's the story.

I think Australia has to be a country which has the "Welcome" sign out. It has to be a country which is clear about itself. This is why I continue to say we can't go around saying, "Oh, we're the Australian people. We've got a new-made polished up economy. We've got a strong society. But by the way, we still - our monarch - our head of state is still the monarch of Great Britain," you know. "And by the way we share her with 16 other countries. And by the way, our flag has the flag of Great Britain in the corner," you know. And whenever the Royal family (inaudible), we give it a little wave. "And by the way, if you want to come here, we're putting a fence around the place. It's verboten to cross the border. It's alright if you fly in on a tourist visa into our main airports and overstay or run off into the community. We won't demonise you for that, but if you arrive in a leaky boat, we will."

LEIGH SALES: So the issue is though that I think a lot of Australians aren't sold on that message that you've just delivered.

PAUL KEATING: Well, they have to get sold - that's the point. You see, psychologically, Australia must understand it has to live in the region around it. Australia must find its security in Asia, it cannot find its security from Asia. The from Asia camp - this was the sort of John Howard line, you know, do what the Americans want, run off to Iraq. We're always looking for a strategic guarantor. It used to be the British and the British Navy; now it's the Americans and the American Navy, whereas a small country as we are, we can't exercise the unilateralist option. We're not strong enough. We have to do it by coalition-building in this part of the world. So therefore, the key matter for Australia is its psychological approach to the region, its psychology, more than it is any one particular thing.

LEIGH SALES: If I can just return to a leadership question. In the past seven years in Australian politics we've seen so many leaders dispensed with - three prime ministers and seven opposition leaders we've been through. Why do you think we're seeing that sort of churn and what sort of implications does it have?

PAUL KEATING: Well, it's - for a start, the public must not know where they are with it all, you know, the shifts. I mean, you would despair over it all, because these things I mention are real. You know, the world is changing. In last 200 years the world has been run from the Atlantic. Fundamentally, that's all changing. That's going now to developing - the developing economies and we have the largest one nearby - that's China, and of course, places like Indonesia and Vietnam. So, so, that's our situation. I mean, we are a country in that transition. You can see the transition affecting the east coast cities of Australia now vis-a-vis the west.

LEIGH SALES: But how does that explain that we've had 10 leaders between the two major political parties?

PAUL KEATING: Well, what I'm saying is they haven't broadly been on the case. They haven't been on the case. Here's the main game changing inexorably, you know, and we've run off to Iraq.

LEIGH SALES: Well what will it say then about federal Labor if they change leaders again in the relatively short term?

PAUL KEATING: Well, you know, that's for the party to make its mind up about. I'm not here to give 'em a running commentary on what - what the pulse is of the federal caucus. I don't belong to it anymore and it's not really my place to second guess them.

LEIGH SALES: You weren't very complimentary though about New South Wales Labor when they were churning through leaders.

PAUL KEATING: Oh, no, no, we had these bozos in Sussex Street knocking off parliamentary leaders. And worse than that, trying to determine the policy. You know, here they were destroying Morris Iemma over the electricity program. You know, and you've now got everyone convinced of the fact that these generating units should be sold.

LEIGH SALES: I wanted to ask you before we run out of time: this book is a collection of speeches, but I know many publishers have chased you to ask: will you write a memoir? Will you ever do that?

PAUL KEATING: Well, what it isn't: it isn't a show-and-tell book. It's a book of ideas. You know, it's everything from the state of the world at the end of the Cold War, the lost opportunity of 16 years, the two Clinton terms, the two George W. terms, the lost opportunity of removing nuclear weapons. It's a - fundamentally a book of ideas and I wouldn't even have produced that except the publisher, Allen & Unwin, said, "Oh, if you're not doing an autobiography, can't you do something with us?" And I said, "Well there's all those speeches I've sent to the archive." They said, "Well, what are they?" So ...

LEIGH SALES: All the others have done show-and-tell books, though. Would you ever ... ?

PAUL KEATING: Yeah, but, you know, I had someone whose name begins with K with a very deep voice say to me once, "Paul, if you're any good, someone else will write a book about you."

LEIGH SALES: Mr Kissinger, was this? (Laughs). Paul Keating, we're out of time. Thankyou very much for joining us.

PAUL KEATING: Thank you, Leigh.