Seldom has so much been said in a single throwaway line.

“In an ideal world,” Malcolm Turnbull mused last week, “every Australian would have private health insurance.”

Of course he immediately denied that he meant Medicare should be abolished; good heavens no, that was verballing him. He and his party were absolutely committed to Medicare. What he meant … well, let’s move right along. No one wants to abolish Medicare. And certainly no one will admit to wanting to; the public has made it clear that Medicare is one institution that it regards as sacrosanct.

But that has never prevented conservative governments from trying to squeeze it out of existence. Malcolm Fraser was the first: after his eight-year regime Gough Whitlam’s Medibank survived in name, but was so debilitated that Bob Hawke had to resurrect it as Medicare. And over the years John Howard tried, rather less successfully, to strangle the new socialist interloper into his privatised world.

Medicare proved a more resilient opponent; it had had 12 years to establish itself as an institution in its own right and to gain popular support. So instead of taking the challenger head on. Howard tried a more devious approach.

As well as doing what he could to undermine the public system, he subverted vast amounts of taxpayer funds to build up its private competitors. The public was bullied, bribed, cajoled and threatened into taking insurance with the private firms; the 30% rebate was just the most blatant and extravagant of a raft of measures.

This was all done in the name of choice; the punters should be able to make up their own minds whether they wanted to stay public or go private. But in fact the aim was the deny them the choice: the public sector was made so comparatively unattractive that they would be driven into the arms of Howard’s ideological allies and financial benefactors in the private sector.

Exactly the same ploy was followed with the schools system: private education was progressively built up at the expense of the public alternative. It got to the stage where concerned parents in the outer suburbs were made to feel that they were guilty of child abuse if they left their kids in state schools. Interviewees frequently said that they had no choice: the only option for them was the local private school. And Malcolm Turnbull no doubt believes that in an ideal world, every Australian child would go to a private school.

For the Liberals, choice, if it means anything, means deciding which private facility the customer can best afford: MBF or HCF, Grammar or Kings. The public system is just not an option.


Apart from that, as they say , Turnbull did pretty well in budget week; that is, he didn’t say anything else really silly and the only one of his colleagues who bagged him was Bronwyn Bishop, who doesn’t count.

His defence of the private health insurance rebate was, of course, unconscionable, but popular among his own troops, which was the major point of the exercise. And his thunderous denunciations of debt and deficit may well register with those portions of the electorate which tend to overlook the fact that by mortgaging themselves to the very limit of their means or in some cases beyond it, they have condemned their own families to a lifetime or more of repayments.

Debts and deficits are as much part of the Australian ethos as pies and beer, and in any case, as the calmer commentators have acknowledged, by international standards Kevin Rudd and Wayne Swan have been positively restrained. The United States and Britain, not to mention the rest of Europe, are in it up to their necks. Australia has barely had to roll its trousers up.

But this does not mean that the next couple of years are going to be easy; in fact the toboggan has barely started down the long slope. Even on the most optimistic estimates were are in for another full year of recession with mounting unemployment and failing markets, and if Rudd sticks to his promise to hold spending growth to 2% — surely the most heroic of all the assumptions in the budget — we are in for some very lean years. The green shoots some optimists claim to discern are probably no more than patches of moss taking hold as the body starts to decay.

In some ways the budget did not help; the tax cuts should at least have been modified and in the circumstances the pension rises were very generous. There were good reasons for going ahead with both, moral as well as political, but there will be a price to be paid and those who pay it will not be happy.

As part of its budget commentary Treasury has finally admitted that the Howard-Costello years were simply unsustainable; not only were the profits of the boom years squandered, but in their last five years the profligate pair actually spent more money than was coming in; by 2007 the budget was in structural deficit. And of course most of the loot went in handouts to the swinging voters; middle class welfare. Rudd and Swan have made a tentative start to unscrambling the eggs, but much remains to be done.

If you think this budget was a bit tough and unpopular, wait for it. You ain’t seen nothing yet.


In the good old days the Canberra Press Gallery presented an award for the most outrageous beat up of the most worthless story of the week. It was, appropriately, a battered egg-beater. Last week it should have gone without dispute to Greg Sheridan for his breathless revelation that everything Kevin Rudd does is guided not by his role as Prime Minister of Australia, but in the hope of becoming Secretary-General of the United Nations. But then John Stone, former Treasury head and failed candidate for the Joh-for PM campaign wrote an indignant letter claiming that Sheridan had actually pinched the idea from one of his articles.

A golden Mixmaster to each of the them, the most imaginative pair of fabulists since the brothers Grimm.

Peter Fray

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