After the 2007 federal election in which Kevin Rudd led the ALP to victory, some observers noted that the Labor hegemony over Australia’s governments was so extensive that one had to go to the Brisbane City Council to find the most senior Liberal holding an executive governmental post.

It is not unfair to say that few commentators expected Ted Baillieu to end up as Victorian premier after the 2010 election, let alone have control of the upper house as well.

Yet within three years, the political cycle has begun to turn in the favour of the Liberal and National parties.

The Liberal-National coalition is on the verge of a revival of its electoral fortunes, beginning with a big surge in the coalition’s fortunes in state politics.

Of course, Labor stalwarts would be quick to point to their party’s success in Tasmania, South Australia and, a little later, in the federal election that saw Julia Gillard returned to government.

These contests were very close results, however, and the final outcome depended on Labor being able to stitch up deals with cross-bench members of parliament in order to secure their support for minority Labor governments.

The fact was that the Coalition came within a whisker of winning the 2010 federal election.

Had the Coalition been able to win more than 48 percent of the seats with the 52 percent of the two-party vote it secured in New South Wales, Tony Abbott would be prime minister now.

After less than three years in office, the Rudd/Gillard government was very nearly tipped out of office in its first term – a feat not achieved since Jim Scullin’s Labor government was voted out after one term during the Great Depression.

If Julia Gillard could claim any real successes in 2010, her ability to negotiate with Greens and independent MPs to gain their support for her second term as prime minister was a highlight.

Everything else about the second Gillard government, however, had a feel of desperation about it. This has been partly due to the decline in the government’s standing in the opinion polls since the election.

This is a real cause for Gillard, and not only because of what it might mean were the government forced to go to an early election.

The precedent set by the Labor Caucus with regard to Kevin Rudd’s leadership was that poor opinion poll performances can become the basis for the removal of the leader.

A rival to Gillard as Labor leader awaits in the wings in the form of Victorian MP Bill Shorten. A run of disastrous polls for Ms Gillard could precipitate the same dynamics that saw Mr Rudd lose the leadership. Shorten has the added attraction to the right-faction convenors that he is of the same group.

The leadership situation in the federal Labor party will be something to watch closely in 2011. Should Gillard end next year with poor poll results again, her position could be very precarious.

All of this is manna to the Liberal party, whose stocks have been enhanced not only by Tony Abbott’s very strong performance, but also by the party’s stunning success in the Victorian state election.

It is not unfair to say that few commentators expected Ted Baillieu to end up as Victorian premier after the 2010 election, let alone have control of the upper house as well.

The Victorian Labor government was seen as vaguely competent and likely to be returned. The election of a Coalition government in Victoria is something of a bonus. By the middle of 2011, the Coalition will in all likelihood also be in government in New South Wales.

It is quite possible, of course, for one political party to dominate national politics while the other major party dominates the politics of any of the states.

Australians are very good at distinguishing between federal and state politics. Liberal successes in state elections do not necessarily mean equate to federal success.

The morale boost to the Liberal party must be great, however, and demonstrates to the federal party that its overall message is resonating with voters in the most populous states as well as in Western Australia.

It has been a fascinating year in Australian politics, not least because of the number of very close elections that were held. There were lots of historical outcomes: an equal outcome in the federal and Tasmanian elections, a close result in South Australia and Victoria, the election of the first lower house Green in a general national election, the formation of a Labor-Green coalition in Tasmania, and the Greens securing the balance of power in the Senate.

All of this means that 2011 will be a very interesting year. In the meantime, it is worth reflecting that 2010 began with the Labor party seemingly in the ascendancy in national politics and in all states except Western Australia.

The year ends, however, with the Coalition enjoying forward momentum. The may be much more of this to come.

Dr Nick Economou is a senior politics lecturer at Monash University and a regular media commentator on Australian politics.