One-term governments, more independents and minor parties winning seats, the rapid draining of the federal government’s popularity: how are we to understand the current instability in Australian politics? Is it because a complacent electorate resists the tough measures needed to rein in government spending and punishes any government that tries to introduce them? This is the line among News Corp journalists. Is it because we have had three duds in a row as prime minister, politicians who were and are unable to convince enough of us that they governed for us all? Or is it because the 24/7 media cycle makes effective government far more difficult than in the sedate days of the evening newspaper, before television interviews and talkback radio put every hesitation, word choice and facial gesture up for analysis?

It’s likely all of the above, but larger structural problems are also apparent, as the party system that took shape in the first decade of last century becomes less and less fit for purpose. Political parties have two clusters of functions: governing functions, which include the development of policy, the recruitment and training of the political elite, and the formation of governments; and representative functions, linking us, the voters, with our parliamentarians by providing channels for the representation of interests and experiences, and giving us a team to follow and thus an investment in what happens in the parliament and the cabinet. At the moment, our major parties are not doing particularly well with either of these. And the failures are linked.

Australian society has changed far more than the parties. For much of the 20th century, the three main parties represented real differences in social experience and economic interest: the Labor Party for the unions and the working class, the Liberal Party (and earlier anti-Labor parties) for business and the middle class, the Country Party (now the National Party) for the farmers and country folk. And they have stayed allied to these interests, even as Australian society and the economy have become more complex and the policy domain much larger. There have been adaptations, the most significant being the transformation of Labor under Gough Whitlam to give it a strong social democratic face that attracted middle-class progressives. But more are needed if we are to regain stability and effectiveness in our governments. I regard two as imperative: the Liberals’ return to the civil centre, and the system coming to some sort of accommodation with the Greens. Both require a return to the art of compromise.

In style and in substance, the federal Liberal Party has moved too far to the right. As a result, it is failing in its key governing functions by providing us with leaders who are unable to win widespread respect or affection and policies that don’t work. The core reason for the government’s unpopularity is last year’s unfair budget, with its suite of radical neoliberal reforms, but the aggression of Tony Abbott and key ministers like George Brandis and Christopher Pyne hasn’t helped. Late last year, Abbott described his chief of staff, Peta Credlin, as “the fiercest political warrior”, as if this were the strongest possible qualification for service at the centre of power. Partisan political warriors – with insiders and outsiders, them and us, winners and losers, and black-and-white solutions – see compromise as weakness, as giving ground to the enemy.

But successful democracies are built on compromise. Complex policy problems have many stakeholders, and stable solutions require give and take and major players prepared to live with what to them are less than perfect outcomes. The government is learning this the hard way with its mangled attempts to “reform” Medicare. How could they have imagined they could introduce a co-payment for consultations without consulting the GPs they were relying on to administer it? Similarly flawed was the attempt to repeal section 18C of the Racial Discrimination Act, as promised to Andrew Bolt and the Institute of Public Affairs. With its antennae tuned to an avowedly right-wing think tank far from the centre of Australian opinion, the government seemed surprised by the hostility from ethnic and religious organisations.

Another example of the unwillingness to compromise was Abbott’s pledge to apply to delist 74,000 hectares of the Tasmanian Wilderness World Heritage Area in order to open it up to logging. This pledge unpicked one of the clauses in the Tasmanian Forest Agreement, the peace deal between the timber industry, timber workers and unions, timber communities and environmental groups that aimed to end decades of bitter conflict. So the conflict resumed, shifting to the United Nations’ World Heritage Committee, which rejected the application.

The other problem of our democracy, relating to the representative function of our party system, can be most clearly seen in a comparison of the Greens with the National Party. The Greens have significantly more electoral support than the Nationals but negligible representation in the nation’s lower houses, and are still treated by the major parties and the mainstream media as an illegitimate interloper.

At the 2013 federal election, the Greens’ primary vote in the House of Representatives was 8.65%. The Nationals’ vote was only 4.29%, though the merged Liberal National Party in Queensland means that this under-represents their true level of support, which is probably closer to 8%. In the Victorian state election in 2014, the Greens’ primary vote in the Legislative Assembly was 11.48% and the Nationals’ 5.53%.

Because the Nationals’ vote is geographically concentrated, its national and statewide votes turn into far more seats than the Greens can ever win: nine in the current House of Representatives to one Green; eight in Victoria’s Legislative Assembly to two Greens. And because of coalition agreements, when the Coalition is in government the Nationals are represented in cabinet, generally in portfolios with implications for environmental management. The Greens have never had a federal cabinet minister. Hence around 10% of the electorate are unable to see their policy preferences and values having a direct influence on government policy.

The Greens fit poorly into the current party system, not just because they are a non-geographically based minor party but also because they are not centred on an identifiable producer group or economic interest. Formed to advocate for environmental values, they have since taken on other progressive, non-material causes, most significantly opposition to the appalling asylum-seeker regime built by both Labor and Coalition governments. The Greens are also the party that argues most strongly for radical responses to climate change. Green voters are not voting on the basis of easily identifiable economic self-interest, and for this they are ridiculed as indulgent and woolly-minded, as if economic imperatives must always trump moral conviction. Tell that to those who opposed the slave trade.

Given the single-member electoral system in most of Australia’s lower houses, the solution to this is not at all easy, even if the Greens do build a beachhead in the inner cities. The most obvious is for the Labor Party to stop treating the Greens as pariahs and come to some sort of accommodation. Resources that are poured into inner-city seats could be spent fighting in the marginals that are key to Labor winning government. Labor voters who occasionally vote Green would not be pushed away. And the chances for progressive Labor policies to become legislation would be increased. If Kevin Rudd had not shut the Greens out of the policy process on the emissions trading scheme (ETS), we might have had a very different outcome.

In the 19th century and for the first decade of the 20th, before the current party system took shape, coalition ministries were the order of the day. Party discipline and identity were weak, and electorates regularly returned independents. The 19th-century colonial politicians who were our first federal parliamentarians were all schooled in the arts of compromise, and the most successful of them, three-time prime minister Alfred Deakin, was a master. The Australian Settlement, the framework under which manufacturers got tariff protection and workers got living wages, is also known as the Deakinite Settlement. These policies lasted so long because they were built on compromise, and so one government did not undo the work of the one before. Compromise built bipartisan support.

Our political system provides plenty of opportunities for compromise: coalition and minority governments, upper houses that aren’t controlled by the government of the day, free and conscience votes, the handling of preferences at election time. And much of the electorate is hungry for a bit of bipartisanship. What is needed, though, is a change of attitude in the political elites. Abbott’s relentless attack on Julia Gillard as the leader of a minority government, as if minority government was illegitimate, was damaging not just to her government, as it was meant to be, but to public understanding of the possibilities of parliamentary democracy. The capacity to compromise is evidence of strength, of respect for other interests and values, of a common interest in enduring solutions, just as often as it is evidence of weakness and indecision. The really big problems Australia faces – climate change, environmental degradation, the long-term budget crisis, too few jobs, developing an effective and humane asylum-seeker policy, the transformation of our geopolitical environment with the rise of China – will only be solved with policies that have some degree of bipartisan support. Without this, one government will simply undo the previous government’s policies, as Abbott did with Labor’s ETS, and Labor would likely have done with any Medicare co-payment.

This applies at the state level too. In Victoria, Denis Napthine’s government signed the contracts for the controversial East West Link on the brink of an election, knowing that it was likely to lose and that Labor opposed the project. This was a daring attempt to blackmail both the electorate and the incoming government, and it failed. Policy solutions that don’t stick are an enormous waste of taxpayers’ money and public servants’ time, and undermine our faith in the capacity of our political elites to govern. They also leave problems unsolved and compounding, and too many policy reversals like the East West Link will increase perceptions of Australia’s sovereign risk.

In the 19th century, ministries were put together from across the party divide. So here is my dream team: Malcolm Turnbull for prime minister, because he is the only one of the current candidates who can think and talk at the same time. Leave Julie Bishop as foreign minister, where she is doing a good job and does not make mistakes. Build in the need for compromise, with Chris Bowen as treasurer, Andrew Leigh as assistant treasurer and Arthur Sinodinos as minister for finance. Leave Scott Morrison and Barnaby Joyce where they are, in social services and agriculture respectively. Make Mark Dreyfus attorney-general and Tony Burke minister for education and training. Give Tanya Plibersek health, Christine Milne the environment, Ken Wyatt indigenous affairs, Greg Hunt communications and Anthony Albanese employment. Put Nick Xenophon in defence and Mark Butler in industry, given the mess the government has made in South Australia with the submarine contract and the car industry. Who to make minister for immigration, to get Australia’s refugee policy back to moral acceptability? Maybe Penny Wong. And send punch-drunk Tony Abbott, snarling Bill Shorten, the factional twins Stephen Conroy and David Feeney, sneering Christopher Pyne and the hapless Joe Hockey to the backbench for a while to de-tribalise them.

Tell me I’m dreaming. I know, but it’s fun. Have a go.

The case for compromise