The old days of Australia as a provincial-minded, Mickey Mouse, bush-capital style of democracy are gone, right? After all, this is a trillion-dollar economy with a sophisticated polity and a highly professional public service.

How, then, to reconcile such sophistication with the management style of a Prime Minister who, according to today’s Fairfax newspapers, “personally blocked the appointment of a senior official he has known since his university days to a high-ranking ambassador’s post”? According to the story (which wasn’t denied by the PM’s office or the Department of Foreign Affairs):

Hugh Borrowman, who until this year headed the international division in the Prime Minister’s Department, was put forward by Foreign Minster Stephen Smith to be Australia’s next top envoy to Germany. But in what officials characterise as unprecedented interference in what is typically a routine check-off, Mr Rudd rejected the advice, supposedly deciding Mr Borrowman lacked sufficient language skills for the role.

Mr Borrowman — who is regarded by colleagues as a smart, diligent and capable diplomat and has held several key jobs — was last week made Australia’s designate ambassador to Sweden.

The mission is commonly seen as a relative diplomatic backwater and effectively a demotion for Mr Borrowman.

There has been much muttering and sniping within government circles about Kevin Rudd’s micro-management of Australia over the past 18 months. Rudd, we know, is a details person. Despite the undoubted quality of his cabinet and his senior public service, the PM insists on being involved in all major discussions and decisions. He pre-empts and second-guesses his ministers and bureaucrats. He is the dominant presence at all major announcements. His office runs the government’s daily media cycle with ruthless precision and control.

All of which was bad enough when events — to paraphrase Harold Macmillan — were running relatively smoothly for the country and the government. But now that events aren’t running smoothly, Rudd’s me-me-me interference is not just the irritating idiosyncrasy of a policy wonk who’s been given a giant train set, it has the potential for creating some really big mistakes.

And, as today’s diplomatic report reveals, some very small-minded mistakes.