Christos Tsiolkas and Gideon Haigh read from Tolerance, Prejudice and Fear commissioned by Sydney PEN. Published in 2007 by Allen & Unwin, it is a purely Australian product.

There is plenty of scope for platitude with such a topic, and the audience got what it came for. Haigh wryly introduced recent events in the Sydney art world, however, and with Tsiolkas added a rider to relief at the federal leadership transition. Nobody actually mentioned "working families" but it hung in the air, a palpable presence.

Haigh didn't need "moral guidance from Kevin". Tsiolkas: "as writers, we should be giving support to" Bill Henson. The audience stayed mum.

They hadn't come for this and knew what to expect. In some ways the session (4 - 5pm) was a bonding exercise, a meeting of like minds similar to Apocalypse Now screenings at the old Valhalla in Glebe.

I mentioned the danger of ignoring the aspirations of the Australian middle class in the light of the shame felt, even a hundred years after transportation stopped. I didn't mention that appeals to the Privy Council in London only stopped in 1986, but the panelists got the drift.

Haigh caught the idea on the full and immediately flipped to a spot in the book where his essay talked about - I'm not sure. It means that I'll buy the book to find it. Some, like Isobel Crombie at the NGV, are discussing it but it never enters the mainstream.

Haigh had mentioned the "benign nationalism" characteristic of Australia. And asked why it changed. They said how grateful Australians are for a mention of Australia in global media. Haigh mentioned there was "no history of revolution or a radical left" that had morphed into fascism on Continental Europe in the first half of last century. "We got off lightly."

But similar xenophobic sentiments were present at the time. And not only in the White Australia policy, that dominated narratives of identity until the sixties. Beer posters and advertising art for decades borrowed the same clean, efficient aesthetic Nazi propagandists used. This translates into fear of anything new.

Tsiolkas said Australia was "not a mirror image of Britain" and, in his family growing up, they easily discussed a republic and a new flag. British identity didn't reach the kitchen table (a glare at me).

But the cultural cringe is real and it is due to the same historical precedents. Australia fears any innovation. I walked up to Robert Manne and we chatted for five minutes. He mentioned that it was impossible, since the French Revolution, not to talk in terms of left and right.

I mentioned the 1840s colonial push for a representative legislative assembly and we discussed the Burkean fear of 'innovation' and avoidance of 'party' in the discourse of such as Henry Parkes. It's a short leap to averring that 'cultural cringe' is from the same font.

Tsiolkas told a story about how he and his friend Spiro went to the AFL one day and refused to stand for the national anthem. He said they feared a bashing. This would not have happened, he said, when he was a kid - things were more relaxed. Singing the song had an ironic undertone.

I bumped into Helen Garner and said how I enjoyed The First Stone (1995). She fixed me with a steely eye and said "is that all you want to ask"? "Are you from Ormond?"

I told her 'no' but said I was struck by her noting the 'passivity' women experience in that kind of situation. I also mentioned that in both this book and Joe Cinque's Consolation (2004) she had not managed to speak to some of the main protagonists.

"It's a small country," I said. "Yes," she said. "People are afraid of damaging their futures," I said. "Yes," she said.

Garner is diminutive but an enormous presence - it is felt physically. Her sharp grey eyes set on you as she prepares a speech act. You feel a strength here.

So when I asked if she was researching the Mildura car accident case or the Diane Brimble case for her next book, she just said: "There are so many rumours."

I also spoke with Danny Gardner and the people from Auburn who performed at the Bangarra Theatre (the same program as I blogged about last week). This is their third year at the festival.

And I spoke with David Brooks and got a copy of Susan Wyndham's new non-fiction title, Life In His Hands: The True Story of a Neurosurgeon and a Pianist (Picador), signed by the author. I mentioned my liking Atul Gawande and asked how the book came about.

Tsiolkas' next novel is out in November. Garner is working on a new non-fiction book that will be based, like her last two non-fiction titles, on a court case. Robert Manne says his upcoming The Monthly essay on Wilfred Burchett will be labelled 'right wing'.