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Moment of truth for Australia's prime minister

By the CNN Wire Staff
Australian Prime Minister Kevin Rudd and Deputy Prime Minister Julia Gillard arrive at the 45th National Labor Conference on July 30, 2009, in Sydney, Australia.
Australian Prime Minister Kevin Rudd and Deputy Prime Minister Julia Gillard arrive at the 45th National Labor Conference on July 30, 2009, in Sydney, Australia.
STORY HIGHLIGHTS
  • Rudd facing challenge from his deputy
  • Gillard would be nation's first female prime minister
  • Rudd's failure to muster support for emissions trading plan seen as key
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Sydney, Australia (CNN) -- A dizzying political drama began unfolding Thursday as the Australian Labor Party met at Parliament House in Canberra to decide the fate of Prime Minister Kevin Rudd.

Analysts predicted Thursday that his fellow party members would replace him with Julia Gillard, his deputy.

If that proves true, Thursday's move would mark an astonishingly rapid tumble for Rudd, a Mandarin-speaking career diplomat who won his party's leadership in 2006 and won a landslide victory over the government of conservative John Howard in 2007.

This year he backed an emissions trading scheme that he trumpeted as a major moral issue.

When Parliament failed to support his plan, he backed off and his popularity began to erode. He then tried to implement a tax on miner profits, but met resistance from the industry and from Australians who said he was attacking the industry that underpins the nation's economy.

Rudd's inability to push through those programs led many among his party to question his ability to lead the government into the next election, which is expected to be held this year. And his alliance with the United States in the war in Afghanistan -- where five Australian soldiers died this month -- has won him little support at home.

If Gillard gets her party's backing, she would emerge as the nation's first female prime minister.

Gillard worked her way through the ranks of the union movement, which is at the heart of the Australian Labor Party. She is largely seen as an effective and loyal deputy. Some observers say she was reluctant to challenge Rudd.

CNN's Stan Grant contributed to this story from Sydney