In one important sense this was not a vote winning budget. It is not what governments have given to people that influences their vote. Gifts are quickly taken for granted. At the polling booth voters make judgments about what each side might grant them in the future.

The only electoral help the government gained from Treasurer Peter Costello’s announcements last night was a reminder that the Howard Government has a good track record in giving back some of what it gains from rising company profits in a growing economy. Labor’s cautious acceptance of most of the budget measures shows it realizes that it must create an impression that things would be no different under them.

The real bribes are yet to come as the Coalition and Labor try to enliven the campaign proper in a few months time with a promised benefit or two. Both government and opposition will try to convince the people that only by electing them will the goodies be delivered.

It was a technique perfected by Labor’s Paul Keating with the L.A.W. tax cuts that helped him win the unwinnable election of 1993. Prime Minister John Howard knows all about the game even though the success of the “fist full of dollars” he thrust into people’s pockets as Treasurer in 1977 had the benefit of Labor not matching them but promising to abolish payroll tax instead.

This time with the very pragmatic Kevin Rudd in charge instead of a rattled and economically illiterate Gough Whitlam, Labor will not be making the mistake of trying to be adventurous. Whether it is further cuts to taxes or spending proposals the parameters of Messrs Howard and Costello will be accepted.

It will be left to the Government to determine how many billions are in the campaign bribery chest with the differences between the parties only apparent at the margins. Labor’s basic line when it comes to economic management will be that anything a Liberal can do we can do too.

Before this budget the Opposition was stressing the key points of difference between itself and the Government as industrial relations, climate change and the war in Iraq. After the budget that remains true. There is no prospect of undermining the economy as the Government’s strong point.

The strategy shadow Treasurer Wayne Swan must continue with is to limit the extent to which economic management is a negative. As he showed in post-budget interview after interview, the best way of doing that is to keep taking Government policies as his own. The only apparent point of difference is to suggest that Labor has a better vision of what will be needed when the mining boom ends although that is an argument unlikely to swing many votes.

Stealing the policies of an opponent is not just a Labor strategy. The concentration in the budget on education was a clear response to Swan’s vision thing about Labor being more committed to promoting productivity growth than the Liberals and Nationals. It was a great illustration of why it is dangerous for an opposition to release policies too early. If they appear to be working it is too easy for a government to incorporate a version of them as its own.

If there was a surprise in the budget it was the scant attention paid to questions of global warming. Presumably Mr Howard is content to see if the pressure for government to act continues to grow or whether it fades as an issue in the months ahead. If the drought breaks he might really be a clever politician in not committing too many billions from his surplus to doing something about it. While there is no certainty that the current drought and warming are related, the public thinks the two are. Dollars not spent on this policy are dollars available for courting favour somewhere else and they will be dollars not available to a Labor Party which has made public its commitment to greatly increased spending on the environment.

It’s time to book your next dose of Crikey.

Through the week, news comes at you fast. Every day there’s a new disaster, depressing numbers or a scandal to doom-scroll to. It’s exhausting, and not good for your health.

Book your next dose of Crikey to get on top of it all. Subscribe now and get your first 12 weeks for $12. And you’ll help us too, because every dollar we get helps us dig even deeper.

Peter Fray
Peter Fray
Editor-in-chief of Crikey
12 weeks for just $12.