1. Tax scare campaign
In its first major scare campaign of the 2019 election the Coalition is claiming that Labor will impose ‘$387 bn of new taxes on your income, your house, your savings’ over the next 10 years.
This is really quite simple.
$157 bn of that is extra revenue to be gained from Labor’s policies on negative gearing of investment homes, the gift cheque of franking credits, largely to well-off or rich retirees who receive no full of part pension and pay no tax, the 2% tax temporary surcharge on the top marginal rate as a deficit reduction measure. The good news, if you want to call it that, is that these measures, costed by Treasury without Treasury being told they were Labor promises, are only $157 bn over 10 years and not $200 bn as the Coalition have been saying for yonks.
The remaining $230 bn relates to the Coalition promise to flatten the mid-range tax scales so that incomes of $45,000 to $200,000 will all be taxed at a marginal rate of 30c in the dollar, which Labor rejects. Shadow treasurer Chris Bowen says the economy won’t be able to afford these tax cuts. He’s probably right. We haven’t had Labor’s last word on budget plans yet, but I think they will be quicker into a surplus of 1% of GDP, which the Coalition projections never reach. Their surpluses are razor thin, and based on such shaky premises about the performance of the economy that they will probably dissolve into the mists, as Wayne Swan found when Treasury/Finance forecasts consistently proved wrong.
Peter Costello says we should take no notice of what is promised in the term after the term after next. He’s right, it’s fairy-tale stuff.
Here’s a graph from The Conversation’s Infographic: Budget 2019 at a glance:
From this we can see that the Whitlam government expanded the public sector by at lead a third, possibly by 40%. It looks as though Keating tried to push that out by around a further 10%, but had to retreat. The Coalition has imposed an arbitrary tax to GDP ratio cap of 23.9%, which The Australia Institute says this will force austerity cuts to existing programs in order to fund new programs. Arguably, this is already happening.
Labor plans to extend the tax to GDP ratio to 25.9%, which is really fiddling around the edges and still leaves us a low-tax country in the OECD.
PM Scott Morrison is telling us that Labor’s tax grab will leave you on average $5400 worse off (not sure whether that is individuals or families, over one year or 10, it matters little). Bill Shorten is coming after “your money”.
This is untrue, unless you are one of the privileged. The rich pay most of the tax, and most people under Labor will pay less.
John Kehoe at the AFR says:
- Tax tables provided by the government to AFR Weekend show a person earning $100,000 – the projected average full-time income in 2024-25 – would face an average tax rate of 23.6 per cent under the Coalition and 25.7 per cent under Labor, compared with 26.6 per cent last year. (Emphasis added)
2. What is wrong with politics?
Laura Tingle’s weekend article this week was Want more voters, major parties? Try behaving properly, published in the ABC as Politicians have no-one to blame but themselves if voters turn their backs. She says politicians behave particularly badly as soon as an election gets called, for example using Treasury figures to diss the opposition, making a rash of appointments a day or so before calling the poll, and using particularly irritating forms of speech, such as:
- “well we might be doing it, but they did it first and/or worse”; or “I won’t be lectured to by them when they did something else completely irrelevant but which sounds equally bad”.
Peter Dutton is the champion at the latter.
Tingle says that in 2016:
- the major parties – the Coalition, in all its manifestations, and Labor – managed to win just 73 per cent of the total vote. And the informal vote – the ultimate “up yours” to all politicians – was 720,915, or just over 5 per cent of the total vote.
She cites former Liberal Leader John Hewson:
- “not only is it detrimental to good government and the national interest that politics has become an opportunistic, short-term game of point-scoring and blame-shifting, indulgent, and mostly negative, but our political masters now seem to have lost their moral compass”.
“Their endgame is simply winning at all costs, even at the expense of decency, compassion and principle.”
I would point out that according to Essential Report, major party polling is pretty much the same as it was in 2016. Tingle, however, is hoping that this time the rate of voter desertion becomes unignorable so that pollie behaviour changes. Wouldn’t that be nice?
3. What is really wrong with politics
ABC RN has brought back the program The Economists for the duration of the election, hosted by Peter Martin and Gigi Foster. (Peter Martin’s bio is out of date – he’s now Business and Economy Editor of The Conversation and a visiting fellow at the Crawford School of Public Policy at the ANU.)
Their first program of the series, Elections and economics with guest Nicholas Gruen, CEO of Lateral Economics, was quite illuminating.
Gruen says that politics in general, and elections, were part of the ‘principal agent’ problem. The government may be the body most able to influence a certain matter, but on many important issues it really does not have control. This leads to false expectations, false promises, and false success claims if something turns out well.
Beyond that there is a problem with the media, because their principal role is to make money. Even the ABC is concerned about ratings, looking for eyeballs. This leads the media to emphasise narratives and stories, rather than the rational consideration of policies and plans. It also reduces the politics to advertising, with an emphasis on the quick snappy grab. He cites figures that in the US between 1968 and 1988 statement from the President had reduced from 48 seconds on average to just 8 seconds.
Like advertising, politics and campaigning now used the technology of human manipulation not persuasion. The aim was to misrepresent the policies and motives of your opponent, and then to manipulate the public response to that manipulation. Gruen did not say so, but clearly that is what we are getting in spades from ScoMo and his mob.
Gruen’s answer to this was to set up ‘citizens chambers’ – 237 people selected to represent the population. 237 because there are 237 federal politicians. They would be seconded for a year, given secretarial and research support to consider issues important to the future. The issue he used was Tony Abbott’s decision to cancel the carbon tax, which he says costs the public purse $11 bn pa directly, leaving aside implications for the planet.
He uses the analogy of a jury in our form of law, so he is looking for strong consensus, citing that in various Australian jurisdictions agreement by 10, 11 or 12 out of 12 is required.
Gruen sees the citizens chamber as additional to, rather than replacing representative democracy, if I’ve got him right. He says citizens chambers are being trialled in Belgium and Madrid. He says we don’t need to wait for the pollies, we can look for benefactor funding.
By and large I can run with his analysis of the problem. The Coalition strategy is blindingly obvious, but this very morning we had Richard di Natale say on Insiders:
- Labor and the Coalition are not serious about climate change. Wrong, Labor is.
- Labor has no plans for developing hydrogen as a green fuel. Wrong, it’s an explicit component of Labor’s platform.
- Labor has no plans to increase NewStart. Labor has said many times that NewStart is too low, but want an inquiry first.
4. Peter Dutton is “toxic” and a “thug”
That’s what Kristina Keneally, who is accompanying Bill Shorten to brighten up his campaign, said about Peter Dutton.
This is what The (un)Australian made of his action this week (strong language alert):
Minister for the Dark Arts Peter Dutton has kicked off his re-election campaign for the seat of Dickson in Queensland by promising constituents that should they re-elect him he will continue to be the same old arsehole that he has been since he was initially elected.
” A lot of promises tend to be made during election campaigns but not many are actually acted upon,” said the Minister. “To the people of Australia look at my record, my actions speak for themselves. I am and will continue to be an arsehole.”
“I mean did you see what I did this morning, having a go at my opponent for being disabled. Tell me those aren’t the actions of an arsehole.”
Here’s how the matter progressed.
First Peter Dutton Reckons His Labor Opponent Is Using Her Disability “As An Excuse” for not living in the electorate. There more at The New Daily and just about every media outlet.
The response from his Labor opponent Ali France was ‘Disability is not an excuse, it is a reality’: Labor candidate hits back at Dutton.
She lost her leg in a car accident in 2011, lives a few minutes outside the electorate, but has had trouble finding a place with appropriate disability access.
If people did not know who Ali France was, they sure do now unless they have been living under a rock. Junkee ran a piece Meet The Woman Hoping To Boot Peter Dutton Out Of Parliament:
At first Dutton doubled down, saying he was just repeating comments made in his electorate. ScoMo supported him.
The he apologised, but only on Twitter. So far it has been too much to expect a personal apology.