Tag Archive for 'budget'

What’s with Anna Bligh?

In the wake of the unnecessary firesale of state assets, the Bligh government has continued down its merry path of trashing Labor policy. Last week we had the refusal to take any action over the charges laid against a 19 year old Cairns woman for “procuring an abortion” by using RU486. Now, it seems, we’re going to see Bligh “muscle up” and take on the public sector unions by reneging on a promise made for pay increases of 4.5%, 4% and 4% over the next three years of enterprise bargaining agreements. The government has already been slashing casual and short term employment across departments and state agencies. Tomorrow’s budget is rumoured to contain cuts to public sector superannuation entitlements and we know that it will place a cap of 2.5% on pay increases.

The state election campaign was a shambolic affair, and it was almost lost. Despite an inept performance, Labor was re-elected primarily because the “jobs” theme and the promise to continue to invest in public infrastructure despite the economic crisis touched a chord with voters. Anna Bligh made much of standing up to credit rating agencies.

So why the turnaround? A couple of factors are at work. The first is Bligh’s inability to set her own direction, adopting rather the path of least resistance recommended by right wing apparatchiks in her office. Let one grumpy voter in a focus group whine about debt, and, well, forget the election promises. Secondly, there’s the misplaced obsession with “strength”, driven by the same advisers. This apparently means tossing Labor policy out the window and pursuing supposedly popular brawls with unions.

This mob have an inability to understand that Labor governments always need to pursue a direction contrary to that favoured by the big end of town to be a success. Talk of ‘reforms’ in the context of short-sighted privatisations is quite risible in this context.

Nor is Bligh apparently capable of learning from the past. Wayne Goss’ government was defeated not by the ‘Koala road’, but in large part because years of managerialist lunacy alienated the public sector vote. Similarly, the slashing of services in outer suburban and regional areas and decisions such as the one to close down the QR workshops in Ipswich in the midst of a recession and deep structural economic change had a lot more to do with the rise of One Nation than some innate Queensland redneckism.

Peter Beattie knew all this.

The irony – or rather, one of the many ironies – is that the government and top bureaucrats have recently been pontificating about the need for public sector spending to create demand in a sluggish economy. That seems – insofar as it means anything – only to apply to bricks and mortar and roads and bridges and to completely eschew people’s livelihoods. All ‘Bligh the Builder’ is paving the way for at the moment is her own defeat.

Was there something on tonight?

I understand that there was some kind of budgetty thing on tonight.

If you’ve got a lot of time on your hands, here’s the Budget papers.

So what goodies from Unkie Wayne did I miss while I was out enjoying a very nice meal?

Turnbull’s turn

I’m not sure if the anniversary has been celebrated, but it’s just over six months since Malcolm Turnbull became Leader of the Opposition. At the time, I suggested that he needed to junk the obsession with the Howard legacy, and lead from the centre. I also said that there was a real chance that he’d end up as Brendan Nelson but without the stunts and the Emo Man persona. It was interesting to see this open letter from Alister Drysdale, a former Fraser advisor, published in Business Spectator on Friday:

You came into politics as a rare beast – successful in business, charismatic, intelligent, representing a vibrant small “l” electorate in Sydney, a man not frightened to take on a case or a cause, a serious contributor to the climate change debate and a tough nut. Not a bad resume for an aspiring Prime Minister.

Yet, within just a few months you are in danger of throwing that reputation to the dogs and joining the queue of failed opposition leaders.

At the G20 this week Obama said he gave only one piece of political advice to Gordon Brown, facing an election – “Gordon, good policy is good politics”. He said results may not be immediate, but would prevail.

Not bad advice, Malcolm. Why don’t you forget that Peter Costello sits behind you – and just do what your instinct and brain tells you?

I think it’s too late now for Turnbull to take that advice. Continue reading ‘Turnbull’s turn’

Taxes vs. public goods Round 6737

John Quiggin wrote an interesting op/ed in the Fin Review today, which I imagine will eventually surface on his blog.

Quiggin picked up on recent remarks by Lindsay Tanner about discipline in the budget process. “Efficiency dividends” are much in the air at the moment, and Tanner appeared to be arguing that the cause of fiscal probity required a razor to be applied to public sector spending, with the goal of eventually returning the budget to surplus.

While Quiggin agreed that the latter goal was desirable, he suggested that “waste” wasn’t a high proportion of commonwealth spending, and argued that it made more sense to scale back the next round of tax cuts. The scheduled tax cuts are highly regressive, and give little or nothing to low and middle income earners. Nor is bracket creep a huge concern at the moment, and the rivers of revenue to be distributed have receded rapidly.

The government seems to be scaling back, or delaying a number of its commitments. While pension increases are apparently electorally sacrosanct, measures like maternity leave are on hold. Julia Gillard’s response to the Bradley review is a good example of this process at work. The government has accepted most of the review’s recommendations, but pushed out the implementation dates for those requiring large additional expenditure. The higher education sector is being told to hold its horses.

There’s something like a replay of the perennial tax cuts vs. services conundrum going on here. But it’s got an interesting new inflection when the quantum of money available is much reduced – focusing in on the economic benefits of spending against permanent tax increases for the upper middle and high end of the income spectrum. I’m inclined to think that there’s some residual defensiveness about the “economic conservative” label at work here. What, one might ask Kevin Rudd, would a social democrat do?

We’ve always been at war with Eastasia

A further sequel to the LNP/Courier-Mail early election mania – Springborg backer Clive Palmer’s 18 year old son, Michael, who’s the LNP candidate for the safe Labor seat of Nudgee, has had a bit more publicity for saying dumb stuff than 18 year old candidates in safe seats usually get. Palmer was slapped down by Tim Nicholls for demanding that Anna Bligh call an election for February 21. Apparently, after the frenzied LNP/Courier-Mail election speculation fest, they’ve now always been committed to seeing that Labor serves a full term.

That’s nice for them, because that’s always been the most probable outcome. Although I do worry about the sunstroke and skin cancer risks unnecessarily run by all those LNP rank & filers sweating it out campaigning on street corners over the Christmas holidays. Treasurer Andrew Fraser reinforced this on Friday in an interview with the Fin Review, discussing the preparations for the June budget and observing:

Anyone who trots out the line the election timing has anything to do with avoiding a June Budget is ill-informed, mostly stupid and probably politically motivated.

I don’t know if he was thinking of The Borg, who judging by the fact that Mark McArdle and Tim Nicholls have been doing all the running for the LNP in the media, is still on hols. Perhaps Lawrence never expected a February poll. Or it may be the ultimate small target strategy. But with Bligh taking a higher profile and announcing good things like a new park at the top of the Kangaroo Point cliffs on crown land overlooking the river and running around the shop spruiking jobs initiatives, they might like to contemplate actually coming up with a political strategy now that Labor’s kicking off its re-election plan.