When the High Court struck down the government’s hyped Malaysia refugee plan this week, its decision not only raised questions about the policy but also started a media flurry about the government’s ability to rule — and Julia Gillard’s to lead.

In a rare attack against the High Court by politicians, Gillard yesterday declared the court’s decision a “missed opportunity … to send a message to asylum seekers not to risk their lives at sea and get into boats” and that it had failed to discourage people smuggling. The court ruling “basically turns on its head the understanding of the law in this country prior to yesterday’s decision,” said Gillard.

The Prime Minister awoke this morning to damning headlines questioning if this is the end of the Gillard government across the nation’s newspapers — well, in the tabloids at least.

Fighting with the High Court judges is “a bad look”, writes Michelle Grattan in The Age.

The “missed opportunity” was hers not the High Court’s, argues The Australian‘s Dennis Shanahan:

“Blame shifting and political sandbagging to trap the opposition are not the way for the government to get out of this mess — that depends on working on basic practical policies that may upset well-meaning humanitarians and Greens but it is the price of being in government.”

But Gillard is right to be infuriated with the decision, says Paul Kelly, editor-at-large of The Australian:

“This majority decision is unwise, a major reinterpretation of the Migration Act and an unjustified intrusion into the realm of asylum-seeker policy.”

The Labor Party is openly talking about the possibility of dropping Gillard as leader, reports Philip Coorey in The Sydney Morning Herald:

“The party was alive with chatter last night about possible replacements for Ms Gillard, including Kevin Rudd and Stephen Smith, although no moves were imminent …

… The Left is expected to call formally today for the resumption of processing in Australia and for asylum seekers who arrive by boat to be treated the same way as the multitudes more who come by plane …

… “The idea of replacing her is no longer pie in the sky. It’s a big blow because she invested so much in this. It was her policy, rather than Bowen’s,” [said an unidentified minister who has previously dismissed any suggestion of a change before the next election]”

Phillip Hudson in the Herald Sun also reported on the Rudd and Smith rumours:

“In an extraordinary turn of events, Labor figures who backed Ms Gillard when she replaced Kevin Rudd as Prime Minister just 14 months ago are now floating a plan that could see Mr Rudd return to the leadership, with Stephen Smith as his deputy and Treasurer.”

Or could Smith be leader? Phillip Hudson and Stephen Scott write in the Courier-Mail:

“Others in the party say Mr Smith, the Defence Minister, would have the numbers in any ballot and Climate Change Minister Greg Combet could emerge as deputy.”

What about often-touted prime ministerial hopeful Bill Shorten? asks Matthew Franklin in The Australian:

“While factional leaders have acknowledged that the High Court’s repudiation of the Prime Minister’s Malaysia Solution has hammered the government’s credibility, they are not contemplating a leadership change.

Other Labor sources are less optimistic, warning that the party’s Right faction is promoting Defence Minister Stephen Smith and Assistant Treasurer Bill Shorten as possible replacements.”

Shorten himself writes in the Herald Sun that Gillard is a strong leader “not distracted by the whims of popularity”:

“Under the leadership of Julia Gillard, Australia has a Prime Minister who is 100 per cent focused on the long-term future of Australia rather than the short-term headlines.”

It’s highly unlikely the leader will be changing any time soon, notes David Penberthy in the Herald Sun:

“But consider this: there is no way Julia Gillard will resign. There is probably no way that caucus will force her aside.”

If the leader isn’t changing, then let’s focus on the issues. Gillard needs to “revert to a position closer to Labor’s heart” regarding asylum seekers, argues Laura Tingle in The Australian Financial Review:

“If you are going to go down, at least go down on morally justifiable ground. Accept refugees as we said as a nation we would do. Treat them well. And in the political realm stop vilifying them.

The government thinks it is going down anyway and has been saying for months it might as well try to be a real Labor government on the way.”

Michael Gordon in The Age agrees, noting that Bowen and Gillard now have two distinct options to take on refugee policy:

“… do they swallow their pride and embrace all the harsh elements of John Howard’s Pacific Solution, or do they take a more measured and compassionate approach that will take longer to deliver results?”

Note: the original “The High Court battle turns into a leadership one” headline on this article has been changed after a few — quite fair — comments.