Australians are more economically secure, yet existentially as anxious as ever.

On the one hand we see a more prosperous, confident and aspirational society, and on the other the continuation of a well-cultivated sense of fear, xenophobia and insecurity.This dazzling essay analyses today’s bipolar nation . It revisits Donald Horne’s Lucky Country, looks at the legacy of Paul Keating, and discusses how John Howard will set out to craft an election-winning strategy. It explains how the Lucky Country and the Frightened Country will be the two grand themes of the election, and in doing so sets the political agenda for 2007’s election year.