While Labor had come to power in 1941 with only the barest majority, depending upon the continued support of two Independents, the chaos in the Opposition parties meant that Curtin's government was fairly secure. Yet there was a sense in which it still lacked a firm mandate from the Australian people to govern in the great national emergency. That was the main issue in the election of August 1943, and there was never any doubt that the mandate would be delivered. Curtin's leadership during the dark days of the Japanese entry into the war was almost universally applauded, even by conservatives, and the main problems were almost 'family' matters for the Labor Party disruption of national mobilisation by some militant unions and constant sniping from dissidents in Caucus. Fortunately these were minor considerations compared with the complete fragmentation of the old United Australia Party which was in its dying days as smaller parties and Independent candidates broke off. The election was a comprehensive triumph for Curtin and the Labor Party. Labor won 49 of the 74 seats in the House (up from 32 won in 1940) and all 19 Senate seats being contested. With control of both chambers of Parliament, and with the Opposition still in disarray, the government was in a position to take the decisive measures necessary.
The first two years in office were dominated completely by the war and foreign policy. However, after the decisive defeat of the Japanese fleet in the battles of the Coral Sea and Midway, and setbacks to the Japanese military occupation in New Guinea, by the end of 1942 the immediate threat of invasion seemed to be over. While relationships with American and British governments (and personally with MacArthur) deteriorated, the government was able to turn its attention to home affairs and planning for a fairer Australian society that might emerge from the war. In December 1942 Chifley took charge of a new Department of Postwar Reconstruction, recruiting the enormous talents of Dr HC ('Nugget') Coombs to direct it.
As in the Great War the absence of so many men and women in the defence forces meant that essential industries were starved of labour, and women filled the gaps. This time women were in the workforce to stay. There was no expectation that women would simply go back to the kitchen when the men returned from the war, and in fact there was little call for that since the government's policies on full employment, along with a booming postwar economy, meant that there was still a shortage of labour. Of course many women did withdraw from the workforce largely to help create the postwar baby boom but restrictions on female employment such as the expectation that women would resign from government jobs when they married, especially in teaching and nursing, were already seen as out of date, although it would take a few years before they all disappeared.
The fundamental drive for the Curtin government was to prevent a situation similar to what happened after the First World War, when unemployment continued at a high level and the economy stubbornly refused to revive. Full employment was the aim. Dr Coombs drafted the ground breaking White Paper on Full Employment (1945). This was the fruit of Labor Party agonising over the problem during the previous 15 years when the party had been out of office during the Depression and then the beginning of the war. Its fundamental principles adopted the Keynesian framework that Ted Theodore had suggested in 1930 that government intervention and investment in the economy was a fundamental tool that could be used to maintain levels of employment during periodic slumps or recessions. Another more traditional Labor principle was added to the recipe that, even if real wages needed to fall during a slump, government support for a 'social wage' of pensions, subsidies and social services would maintain the standard of living, especially for the poorer sections of society. These principles were accepted by the later Menzies government and remained fundamental to the Australian approach to economic management until they were challenged by the rise of neo-liberal values of minimal government and unregulated market freedom promoted by Margaret Thatcher in Britain and President Reagan in the USA during the 1970s and 1980s.
To implement these ideas any Commonwealth government would need either the cooperation of State governments or a change in the Federal relationship. A set of 14 proposals, mostly to give the Commonwealth greater constitutional authority in economic and social welfare management, were rejected in a referendum in 1944, but in general Labor had the support of the community in its aims, even while the desired means were rejected. The war mobilisation had already made Australia more centrally governed, and the electorate did not want to accentuate that trend, although they did relent by approving an important amendment to the Constitution in 1946 that gave the Commonwealth authority to legislate on social welfare matters. While these measures had the complete support of Curtin, it was Chifley who drove the government's agenda in these matters. On 5 July 1945 John Curtin died, leaving Chifley to manage the peace.
The Curtin government presided over an almost revolutionary change in Australian society, largely brought about by the demands of a wartime economy and technological change associated with it. The widespread availability of the new miracle drugs had an immediate impact on health care, and soon enabled the control or elimination of diseases that had been the scourges of previous generations, such as tuberculosis, diphtheria, infantile paralysis and pneumonia. Householders were already starting to buy early versions of washing machines, refrigerators and more sophisticated radios and record players. There was an expectation that Australians would not leave school at the age of 14 or 15, but would go on to higher levels of university or technical education. Motor cars would not become widely available for a few years, but that change was underway. One of the social scourges of Australian society in the pre-war era sectarian rivalries between Protestants and Catholics was seen to be irrelevant in this new society and was already dying. The Labor Party did not cause most of these changes. What it did was to ensure that Australians accommodated themselves to radical change without serious social disruption.
The measure of the success of the Curtin government can be seen by comparison with national leadership in and after the First World War. Where Prime Minister Billy Hughes had divided the nation bitterly, leaving social scars of class and sectarian hostility that lasted throughout the 1920s, John Curtin united Australians in their determination to endure whatever was necessary to survive and win the war and to create a better society after the war. Where Hughes had asserted the Britishness of Australians, Curtin left no doubt that the interests of Australia were paramount. While many commentators have argued that the Australian nation became adult with the blood of Gallipoli, there is a better argument that modern Australia nationhood was created in the Second World War and nurtured by the Labor Government of John Curtin.