Yeah, lets just keep spending and borrowing like Wayne Goose.
Yes we will be puddle, no matter WHO wins the next election, but keep hold of your dreams
Australia’s 40-year debate about the role of government is over. And Labor has won. The election of the Whitlam government in 1972 marked the beginning of the steady expansion of social democratic service delivery. Whitlamism declared that the essential services of a good society could only be delivered through the collective resources of the state.
The Hawke and Keating governments honoured Gough’s legacy through Medicare, national superannuation, mass university education and environmental protection. The Rudd and Gillard governments have continued this pattern through DisabilityCare, paid parental leave, public housing reform and the NBN. Each of the markers of a modern, civilised, cradle-to-grave welfare state is now in place. Over four decades, public expenditure in Australia has risen from 27 per cent to 39 per cent of GDP.
The great debate ended last Thursday when, in his budget reply speech, Tony Abbott conceded defeat. After three years of grinding negativity about Labor’s policies, especially the scale of government spending, Abbott had a chance to set out an alternative vision for smaller government, to roll back the welfare state. Instead, he rubber-stamped most of Labor’s measures and added his own burst of profligacy.
According to opinion polls, the government will be routed electorally on September 14. But this is secondary to the most important struggle in national politics: the battle for ideological supremacy. Here the Liberals are in retreat. Abbott’s budget speech was a 30-minute exercise in white-flag waving.
Take his stance on welfare entitlements. The Opposition Leader announced that even though he is abolishing the carbon tax, he will maintain annual payments of $4.5 billion as carbon tax compensation. This is an entitlement the likes of which we have never seen, the payment of money to offset the financial impact of a tax which won’t exist under an Abbott government. It is the Liberal equivalent of bad-back syndrome: compo for nothing.
After 20 years of strong economic growth and large increases in real disposable income, Australian households can easily cope with reduced transfer payments. As private incomes have grown, middle class welfare can be wound back, thereby restoring the budget to surplus.
The ‘age of entitlement’ continues
This is the type of strategy shadow treasurer Joe Hockey has spoken about in promising to end ‘the age of entitlement’. But far from ending entitlements, Abbott announced two new ones: the compo-for-nothing scheme and more generous paid parental leave, with payments of up to $75,000 for six months’ leave. Hockey was made to look like a fool.
The Liberal leader also confirmed major expenditure on his command-and-control Direct Action policy for carbon abatement.
Consider the contradiction. T
he compo-for-nothing scheme will give households extra money with which to buy cheaper carbon-intensive products, while Direct Action will spend taxpayer funds on tree planting and carbon sequestration.
The net impact of Abbott’s speech is to weaken the budget bottom-line by $7.8 billion over four years.
This is just the beginning of Coalition extravagance. Earlier this year, Barnaby Joyce endorsed a plan for spending $30 billion on dam construction. “It’s a good policy,” he told Sydney Radio 2GB. “We need to do it.” Shadow finance minister Andrew Robb has described these water projects as vital to the nation’s economic development.
In its accumulated promises, the Coalition – just like the Fraser and Howard governments before it – is set to add to the size of the public sector. Australia’s right-wing ideologues have wasted their time in arguing for smaller government. Their man Abbott is a dud.
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On Sunday the well-connected News Ltd commentator Peter van Onselen wrote of “scuttlebutt” being spread by Liberal MPs that Andrew Robb’s “health isn’t good”. Some of “his more ambitious colleagues are now using [Robb’s battle with depression] against him,” he said. Last month, when I criticised Robb’s deceitfulness in his book, Black Dog Daze, senior Liberals Jeff Kennett and Nick Minchin complained about unfair attacks on “a good man”.
I look forward to Kennett and Minchin tracking down the MPs in van Onselen’s article and outing them publicly. If they shirk this task, it will expose their complaints as having been more about party politics than mental illness.
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