Just as the Aussies fall in love with him, is the Great Persuader losing his touch?

Malcolm Turnbull and some sections of the Aussie media are in awe of John Key's powers of persuasion.

As he toppled Tony Abbott earlier this week, the new Aussie prime minister namechecked the NZ PM for "economic leadership," saying "John Key has been able to achieve very significant economic reforms in New Zealand by doing just that – by explaining complex issues and then making the case for them and that is certainly something we should do."

And the AFR ran an op-ed called "New PM's (John) Key role model" that mined the same theme.*

But ironically all of this praise comes at a time when the Great Persuader is losing his touch, or at least going through a fallow patch.

A couple of years ago, Mr Key argued for the sale of Crafar Farms to Shanghai Pengxin and more overseas investment in general. This week his government over-ruled the Overseas Investment Office’s original decision and torpedoed the sale of Lochinver to a Chinese company.

The PM’s main debating point at the moment is of course of the flag referendum. The chattering classes and social media have dubbed his effort a disaster, but a UMR Aug 25 – 31 poll of 1000 voters (a proper poll, not a self-selecting online poll) indicates things are actually pretty close:

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I'm in the camp that thinks the flag should change but the four finalists are too bland and amateurish. But I think he's actually done well talking the silent majority around and Mr Key’s pet legacy project could well become a reality (Update: a 3News poll finds 69% against change).

Aussie media have also praised Mr Key for making the case for asset sales. And, true, National did put power company privatisation into its election manifesto, risking a populist/nationalist backlash. It was re-elected and bar the basket case Solid Energy, all of the sales went through.

But there were limits to that victory. Mr Key was aware of public sentiment, which was confirmed by the 2013 Citizens-Initiated Referendum that saw people voted overwhelmingly against asset sales (67% to 33%). The referendum actually came part way through the asset sale process, but Mr Key (as ever) was keenly aware which way the wind was blowing, and his sensitivity to public sentiment coloured National’s policy as it pledged to sell minority stakes in power companies only, and made the politically-savvy but economically-mindless (in terms of getting the best price) decision to reserve some shares for small New Zealand investors. It seemed more like Joe Public had persuaded the prime minister against real asset sales rather than the other way around.

More generally, there’s a swag of Clark-Cullen polices that National cabinet ministers frequently bag in private – interest-free student loans, Working for Families, Kiwi Bank, the Super Fund, KiwiSaver – which this government has only tweaked around the edges. Mr Key has seemed loath to cash in any of his political capital to persuade the Great New Zealand Public of more right-wing alternatives.

So far, this National government has followed its predecessors, sitting on and tweaking reforms passed by Labour (the welfare state in the 1930s, ACC in the 1970s, the Rogernomics reforms of the 1980s, the Clark-Cullen 2000s policies mentioned above). Beyond the hyper-interventionist Muldoon, big structural reforms have been off the agenda. Mr Key thinks, correctly, that most Kiwis hug the centre, and are quite happy with the state having a big role in many areas. And, in his pursuit of re-election, he hasn’t felt moved to persuade them otherwise.

* Yes, I know it was by one David Farrar but you don't have to go far in Aussie media recently to find a "grass is greener over the ditch" article