MUNGO MACCALLUM.  Morrison climbs aboard Plan A

Jul 9, 2019

Last week Anthony Albanese passed his first test – at least the one the magisterial examiners of The Australian devised for him. He had retreated, gloated the paper – caved, rolled over to the majesty of the ScoMo mandate.

By agreeing to pass the enormity of the coalition tax package, he had acknowledged the verdict of hard-working Australians. and it follows, as dogs return to their vomit, that any other bright ideas Scott Morrison can come up with must be obeyed with similar capitulation.

After all, isn’t that the point of an election? We won, they lost – and that makes everything they ever did or said irrelevant. We might as well close down the opposition altogether, we can do better without it. Come to that, we don’t really need the parliament at all – the executive is quite capable of governing without it.

Indeed, why bother with a ministry? When Morrison was asked before the election who would drive the agenda is he won, he replied simply: “I will.” There have long been mutterings about how democracy was failing,  the need for a strong leader — so why not leave it to the great helmsman, the miraculous marketeer? How good is dictatorship?

Well, actually not very, so fortunately things are not quite as dire as that scenario might imply. But that is the logic behind Albanese’s capitulation. The rationale appears to be one of caution, if not outright cowardice – if Labor had opposed the package, it would be berated and attacked for holding back the lollies out of sheer spite and stubborness.  That was why the bill was called, risibly, “Treasury Laws Amendment Bill (Tax Relief so Working Australians Keep More of their Money.)”

But did anyone seriously believe that abject surrender would be greeted with applause? It took seconds for Morrison return to the constant abuse and for The Australian to set up another test, this one (surprise surprise) over national security – the need to give more power and influence to Peter Dutton and his  goon squad and repeal legislation bringing suffering asylum seekers treatment.

As we all know, giving in to bully tactics may buy a few moments peace, but is ultimately utterly self-defeating. Labor had a clear, consistent and defensible position: while stages one and two of the tax package were acceptable and even sensible, stage three was both regressive and fanciful – and also unnecessary, given that it was still two elections away from being implemented.

Labor was willing, even eager, to support stage one and bring stage two forward as a matter of urgency. And there would be plenty of time to worry about stage three if and when the circumstances were appropriate. The government, of course, rejected that proposition out of hand, ranting about its mandate – and it may have continued to call Albanese’s bluff.

But it would have been a dangerous one – Morrison had promised immediate cuts to the lower end of income earners and the need for economic stimulus was, and is, glaringly apparent. And Morrison, as he constantly tells us, is the man in charge. If he could not get his policy through, his would be the failure.

At the very least, it can be argued that Albanese blinked prematurely. And in doing so, he has greatly disappointed his followers, who were hoping that he fight for what he believed in. Political pragmatism is all very well, but throwing in the towel at the first challenge is not a good look.

Albo may have passéd the test The Australian set, but at the cost of failing the more important one before an already cynical and disillusioned public. In The Australian Graham Richardson, these days more of a Murdochian than a Labor warrior, asked that if the party would not agree to tax cuts, what would they agree to? To which the obvious response should be: if the party will not stand up for its principles, what will it stand up for?

But for all the crowing from the right, Morrison and his treasurer Josh Frydenberg now face a test of their own, and it will come much quicker than the rainbow gold of the stage three tax cuts. The whole point of the package, Morrison insisted, was to kick start the sluggish economy – in particular to created more jobs, to reduce the current figure of 5.2 per cent unemployment to something like the 4.5 per cent the Reserve Bank believes is necessary to get wages moving.

And there is considerable doubt over whether the $1000 handout from stage one will even touch the sides. The RBA’s Phillip Lowe is clearly sceptical – he has continually called for more and quicker infrastructure, a demand that has now been taken up by most of the state governments. But Frydenberg says there is no need for it – the current mix is sufficient, and with a bit more bureaucracy busting and union bashing we can muddle through.

After all, he declares with all the conviction of a man assuring us that black is white and the sun rises in the west, we have a strong economy. Well, he would say that, wouldn’t he? His job is to be a professional Pollyanna. But quite apart from the self-evident fact that the economy is in the doldrums – drifting into recession, according to an increasing number of realists – Frydenberg seems unable to diagnose the problem, let alone to find a remedy.

He is still extoling his putative surplus, which Ed Husic perceptively describes as a vanity project: if it eventuates, it is more likely to do harm than good. And Frydenberg is still claiming that the whole tax package is fully funded – why, just look at the projections in the budget. Even if that was true then (and it probably wasn’t) it certainly isn’t now: those projections have been consistently downgraded since then, and two interest  rate cuts have made it clear that we are sinking steadily deeper into the mire.

The tax package was supposed to be the great panacea, the universal solvent, the philosopher’s stone. If it doesn’t work, there is no plan B, and even ScoMo – even The Australian – will find it hard to lay the blame on Labor. So perhaps Albanese will have the last laugh after all. Except that if everything goes down the toilet, no one will be laughing.


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