The Coalition’s last-minute cuts tell us little about its fiscal policy but a great deal about its political priorities. Tony Abbott will target the weak and cosy up to middle Australia’s sense of entitlement. Which is risky …
And so, after years of railing at the government’s fiscal waste and economic mismanagement, and saying the only thing standing between Australia and a surplus was the incompetence of Labor, it turns out the Coalition will be, by its own lights, $6 billion better than Labor over the forward estimates.
It is indeed the “better bottom line” promised by Tony Abbott, but one so miniscule that the tiniest of parameter adjustments would blow it away. It ain’t much after all that waiting and teasing from shadow treasurer Joe Hockey about costings.
In trying to make a good fist of the Coalition’s fiscal position, The Australian Financial Review’sAlan Mitchell tried to argue Abbott is proposing to deal with the transition from the mining investment boom more intelligently than Labor, because Labor is propping up manufacturing and wasting money on the NBN while Abbott is investing in infrastructure. But as Mitchell had to admit, it would be the quality of Abbott’s infrastructure spending that would determine how intelligent that was.
Abbott says he wants to be an “infrastructure prime minister”. More accurately, he wants to be a roads prime minister. The majority of the Coalition’s infrastructure spending will be on regional roads, which has always been the Coalition’s idea of infrastructure. In Mitchell’s logic, apparently, NBN = bad infrastructure, roads = good infrastructure. Well, each to their own.
The emphasis on regional roads of course reflects the obscurantism of the Nationals. That brings us to the real significance of the Coalition’s spending and savings priorities: they have signed up to the same fiscal policy as Labor, but their spending and saving plans tell us much about their priorities. As the Good Book sayeth, by their fruits shall you know them.
So consider some of the Coalition’s biggest savings: cutting our humanitarian migration program back by over one-third. Reversing the hitherto-bipartisan commitment, first made by the Howard government, to lift foreign aid to 0.5% of gross national income (limply justified by foreign affairs spokewoman Julie Bishop because she’d heard allegations of corruption in PNG). Cutting legal aid for asylum seekers (thus likely increasing the burden on courts as asylum seekers represent themselves). Cutting back water buybacks in the Murray-Darling at a time when water entitlements are cheaper than they have been in years. Yet another round of public service cuts. Dumping the low-income superannuation contribution.
“It’s emblematic of the way the Coalition has more successfully appealed to middle Australia in this campaign.”
Regardless of the morality of some of those cuts, there’s a common theme running through them: they’re all the political equivalent of victimless crimes. The world’s most desperate people, fleeing persecution. Poor foreigners. Poor Australians who are unlikely to ever vote for the Coalition. The long-term health of the Murray-Darling, and value for taxpayers. Canberra shinybums. Climate programs (including, as Fairfax’s Tom Arup spotted, cuts to its own Direct Action program before it even begins). Industry assistance programs.
And who wins from the Coalition, apart from National electorates? The tax rorters of the novated lease industry. High-income earners via Abbott’s paid parental leave (PPL) scheme. Those Liberal Party loyalists, self-funded retirees, who might be unhappy about the impact on dividends of the PPL scheme. The mining industry.
So, the Coalition has declined to take any politically difficult savings decisions, preferring to target sectors with little political clout, or people in other countries. And it has rewarded its perceived friends, those who are already doing very well, thank you.
No one expects oppositions to sign up to a slate of politically suicidal cuts, but the Coalition’s priorities suggest the “tough decisions” it makes will merely be tough on those who pose no political threat, and that the “age of entitlement” is opening up again, after Labor wore so much grief for trying to curb it marginally while in office.
It’s emblematic of the way the Coalition has more successfully appealed to middle Australia in this campaign. It has nullified those areas where Labor has successfully appealed to the electorate with a modicum of vision — on economic management focused on jobs, on more effective and fairer education funding, on DisabilityCare — and cleverly played to voters’ sense of entitlement, shifting from an asylum seeker policy designed to stop boat arrivals to an outright punitive policy (Fiona Scott’s complaint that asylum seekers were blocking freeways in western Sydney wasn’t some accidental stupidity, but a statement intended to echo with voters, which is why immigration spokesman Scott Morrison backed it) and handing out money, Howard-style, to middle and high-income earners.
If Labor voters think that’s somehow unfair and not in the national interest, well 1) tough luck and 2) Kevin Rudd won office in 2007 by pandering to the same sense of entitlement, so get over it.
Abbott and Hockey have made much of taking a different approach to Labor, of “underpromising and overdelivering”. That’s smart politics that may stand them in good stead when in government. But having stoked middle Australia’s sense of entitlement to get into office, the Coalition might still find, as Rudd did, that meeting its expectations is almost impossible. Good luck there, chaps.