A step to the left or a lurch to the right: what next after the Liberals’ election horror show?

Faced with the disastrous loss of its heartland seats in the wealthier suburbs of Sydney and Melbourne, a near wholesale rejection in Western Australia and losses in other urban middle ring seats, the Liberal party faces a true crisis of identity.

How does it rebuild?

Does it move to the right and try to reclaim the support lost to One Nation and the UAP?

Does it take a leaf out of the playbook of Donald Trump and lean in to populism, exploiting the grievances of those who feel they have been left behind, while pursuing a "values led" society that will be supported by "a silent majority" supposedly cowed into silence by "woke elites"?

Or does it, as the NSW treasurer and leading moderate Matt Kean proposes, modernise and return to the centre to win back the seats lost to teal independents?

Does it look to the examples of Emmanuel Macron in France and John Key in New Zealand, who acknowledged the climate emergency while pursuing conservative fiscal agendas?

Should the party return to its neoliberal phase, refocusing on small government and economic reform that appeals to small business, including on industrial relations?

Do the Liberals stop trying to span a breadth of views ranging from the coal advocacy and regional pork-barrelling of their Nationals colleagues through to moderates urging a rapid transition to a green economy and measures to shore up integrity in politics?

Should it leave the Coalition, at least in opposition?

Or does it try to rebuild Menzies' broad church and learn to "fly with both wings" as NSW premier Dominic Perrottet appears to be doing?

These are some of the possible courses that have been canvassed in the wake of last week's election.

An angry, "despondent" Peta Credlin, former chief of staff to Tony Abbott turned political commentator on Sky, has urged the party to rebuild by focusing on the "forgotten people on the fringes of the cities".

These people, she argues, are more concerned about making ends meet, their power bills and house prices, than climate change and the Uluru statement from the heart.

She argues that the state divisions of the party have been "bullied into going woke".

"They are getting too scared to speak their minds," she says.

Credlin argues that the total right-leaning vote, including One Nation, United Australia party and the Liberal Democrats (about 46% of the primary vote), is larger than that of Labor and the Greens combined (about 44%).

The Liberals have been masters at crafting wide coalitions of support. But can it be done without wooing back the well-educated, wealthy heartland they have lost in Sydney and Melbourne to independent teal candidates - the very people who used to fund the Liberal party and run some of the biggest businesses in the country?

The trajectory of the US Republican party shares some similarities with Credlin's view, particularly in the attack on "elites", but also some clear differences in the kind of social issues that have electoral traction there.

And Trump's model for success might not offer much guidance for Australia because of differences in the voting system, says Mick Mulvaney, a visiting fellow at the US Studies Centre and an expert on the Republican party.

"The parallels are hard to draw because the US has a firmly entrenched two-party system with voluntary voting [and no preferential voting]," he says.

"The smaller party dynamic doesn't exist. With two parties only, there's nowhere for voters to go.

"Under Trump the Republicans became a lot more populist. Trump took us back to our Reagan roots of being the party of the blue collar union workers in the midwest. It's gotten a bit more conservative on social issues. It's lost some of the moral high ground on spending, which was a traditional strength.

"The most interesting issue has been abortion, with the Republican party now almost 100% pro-life, and the Democrats almost 100% pro-choice. Social conservatism has become a greater part of their platform because [different factions] disagree on spending, because it does speak to the entire party."

But it's quickly apparent that such strategies may have a much narrower appeal in Australia than the US.

Abortion barely registers as a federal election issue, and unlike the US, Australia is not a churchgoing nation.

The 2016 census revealed that 68% of Australians identify as Christian, but the percentage of Australians who say they regularly attend a church or other place of worship was just 17.4% in 2020, according to a Roy Morgan survey.

In the US, 47% say they attend a church, synagogue or mosque regularly, according to Gallup research.

Following Trump down the path of social conservatism and culture wars - something Morrison seemed to dally with by picking Katherine Deves as the candidate for Warringah - has obvious problems in Australia.

The UK offers another version of uniting traditional conservative voters with working-class interests, but again one with characteristics that do not necessarily apply in Australia.

The Conservative party's ascendancy under Boris Johnson has been defined by Brexit, a uniquely British event.

Johnson successfully translated support for Brexit in formerly Labour northern working-class seats into a huge general election victory in 2019.

Political scientist Matthew Goodwin said: "One reason why Johnson emerged with the biggest Conservative majority since Margaret Thatcher's third and final majority in 1987 is because he united Leavers; those who have felt ignored, neglected and even held in contempt by much of the ruling class.

"These voters also changed the nature of conservatism, something Johnson's advisers have clearly struggled to recognise and respond to. The Conservative party today is simply far more dependent on people who want strong borders, controlled and ideally less immigration, who want the government to prioritise national (not universal) rights, a more robust response to radical left progressives and for serious reforms to the progressive consensus that has dominated Britain and many of its institutions for 20 years."

Johnson promised a "levelling up" of resources across the country, but so far has struggled to deliver. It's also worth considering what underpins Johnson's uneasy coalition: economic nationalism and controls on migration.

These might not be easily emulated in Australia. As a major commodity exporter, Australia depends on being part of the global economy - and as the last two years have shown, more strident language on China and security has come with consequences.

An attack on migration might win back the One Nation voters, while alienating multicultural communities in the outer suburbs and the business community.

The migration debate, once out of the bottle, could have ugly consequences.

Marine Le Pen styled the 2022 French presidential election as a battle of "patriots" against "globalists" such as president Emmanuel Macron.

She said only she understood the "forgotten" peripheral France, hit by unemployment, fearing for the future and neglected by the "privileged elites" of cosmopolitan cities.

Mark Kenny, professor of politics at the Australian Studies Centre at ANU, says the Liberal party has to stop listening to commentators on the fringes, specifically in the Murdoch media.

"My view is the Liberal party has become enthralled to media extremists - and I am talking about Sky after Dark. When you perform for the barrackers on the extremes, it doesn't take long for the people in the middle to realise that you don't represent them any more," he says.

Kenny and many of the moderates in the party, from Kean to the defeated Dave Sharma in Wentworth, are urging an end to the climate wars and for the party to return to what they term the sensible centre.

They point to the example of Macron and other conservative leaders, such as New Zealand's Key, Germany's Angela Merkel and others who have embraced rapid action on climate change while still pursing a more conservative economic agenda.

"We're the natural party of government because we stand for enterprise, freedom and opportunity. Those values still speak to the electorate; the Liberal party has just stopped talking to those values," says Kean.

He says the party needs to bring together people who care about the environment and people who want to build a community, while at the same time having a strong economy and defence framework.

"The thing that does unite centre right people is economics and building a centre right economy. Morrison stopped talking about that. He stopped talking about tax reform, industrial relations and fiscal management," Kean says.

Kenny says the last years of leaning in to the grievances of minority conservative groups has taken the Liberal party further from the centre and that needs to be acknowledged.

"Throwing out euphemisms like 'the quiet Australians' to camouflage his real project of demonising elites, Scott Morrison told a mining conference a year ago: 'We're not going to achieve net zero in the cafes, dinner parties and wine bars of our inner cities'," Kenny notes.

"It turns out this was a thumb in the eye to his own party's greatest asset, its rusted-on intergenerational base of cashed-up professionals in its heartland. In the year since, this support base has been not just ignored, but insulted."

One of the leading right factional figures of the NSW Liberals, Dallas McInerney, says the party needs to learn "to fly with both wings", as the NSW premier, Dominic Perrottet, and Kean have tried to do.

The NSW Liberals, once racked by civil war, have crafted a relatively solid detente over the past decade in which it has been in power at state level.

That has meant treating the climate crisis as an economic opportunity, to be facilitated by government through programs such as the renewable energy zone.

The party has also managed emotional debates on social issues such as voluntary assisted dying by allowing conscience votes, rather than weaponising them internally.

McInerney says the party also needs to stop fighting wars over issues that are now relatively settled in the public's mind, like superannuation.

"Superannuation is now people's second biggest asset after their homes, so people were suspicious about the housing policy that allowed that nest egg to be dismantled," McInerney says.

Peter Kurti, a director at conservative thinktank the Centre for Independent Studies, says the Liberals should not get too distracted by the losses to the teals, however much they sting.

"If they had not lost seats to the teals, the Labor party would still be forming government," he says.

"It's an emotive issue but I don't think tacking toward climate change activism is going to be of help in the longer term.

"That will be harder because we have just come out of a pandemic and a Liberal government has been more present in our lives than we have ever known. They need to rediscover and renew their values, find new candidates and outline to the Australian people what they stand for."

On current counting, 21 of the Coalition's MPs in the new parliament will be from Queensland's merged Liberal National party, with only 28 Liberals and 10 Nationals from elsewhere.

It suggests that in the north Morrison's message of disdain for "elites" and the Nationals' backsliding on climate still have some resonance.

With Peter Dutton all but certain to be leader, Queensland Liberals could have an outsized voice in the future direction of the party. How willing will the Coalition be to move on climate change, given the strong influence of the coal industry in that state?

And how will the voices of the decimated moderates in Sydney and Melbourne be heard?

One of the big questions raised early on is whether the formal coalition between the Liberal and Nationals should persist in opposition.

In the past six years the Nationals have more stridently exerted their influence, over climate policy particularly.

A separation would allow the Liberals to concentrate on rebuilding, but is made more difficult by the formal merger of the parties.

There's plenty to contemplate for the shell-shocked Liberals. But there is no obvious overseas model that offers much comfort. The answers may lie much closer to home.