07 May 2016
by Urban Wronski
Morrison’s dangerous, deluded dud budget a dead giveaway.
Jobs and growth. Scott Morrison may not be the smartest treasurer we’ve seen but, my, how he loves to parrot a slogan. He’s not referring to the more than 1000 jobs which will be axed from the community services sector following federal budget cuts to homelessness services, mental health programs and community legal centres.
Nor is he talking about the efficiency dividend of $1.2 billion which will see another swag of public service jobs disappear despite his government’s promise not to make any further public service cuts.
“This is a continuation of a policy that meant one in three phone calls to the Medicare, Centrelink and child support agencies went unanswered last financial year, 22 million calls missed in total,” says CPSU leader Nadine Flood.
Jobs and growth. He has to do something. Budget MK III is utterly bankrupt; devoid of ideas, initiative or integrity. Even the title: Come in spinner. What a way to end the series!
Jobs and growth. No-one can follow ScoMo’s budget story, helpfully subtitled in the budget slideshow “sticking to our economic plan.” Everyone knows what happened to the architects of that plan. Yet so much in the Budget Mk III could be titled Not the Hockey Horror Show. Clearly Morrison’s just stringing us along until the election, hoping we’ll forget the cuts to health and welfare Abbott left on the books.
Yet who could forget the $600 million from planned cuts to access to Family Tax Benefits, $258 million from the outlawing of “double-dipping” of maternity leave schemes and the $139 million from increasing co-payments and changing the safety net for the Pharmaceutical Benefits Scheme.
Things do look crook. After three years in government, unemployment is still just under 6%, inflation is diving through the Axminister and the economy is tanking. Turnbull’s economic management credentials may have been talked up for the coup. His tax reform charade was another triumph of spin over substance. So, too, is his budget.
Come budget night, all his government can do is to turn its back on the average Australian, ignore the realities of climate change, health and education, cease to provide for the needs of an increasingly ageing population and give away $9 billion in individual tax cuts to those who really don’t need the money and to small business in corporate welfare.
Of course it’s not all handouts to companies. Pre budget spin has told us that women will love the tax cuts for those earning over $80,000 or is that the 16% of women who enjoy this salary. Spin all you like, the cuts are for the rich blokes. In fact, it’s a bit of a rich white bloke’s budget but you can’t say that on the ABC.
Blokes are less likely to use the women’s refuges and youth shelters which will be hit hard by the axing of a $115 million program to meet the needs of the rising numbers of homeless Australians.
Of course there’s more to it than this. Superannuation claims are trimmed especially for millionaires and there’s a lovely fairy story about how multinationals will be made to pay their fair share of tax by an ATO which has lost 4000 workers but will now get about a quarter of its staff back just for this purpose. Perhaps they’ll call them the unicorn branch.
International aid is cut by a further $224 million, after a one billion dollar hit last year to a record low of 23 cents in every $100 of gross national income. Unprecedented numbers of people caught in global humanitarian crises and people displaced by conflict have led 22 wealthy nations to increase their aid contribution. Only Australia joins Portugal in making cuts. Yet Australia can still find $1 billion to fund indefinite offshore detention of men, women and children.
A thousand young people, we discover, are to be rescued from unemployment by internships which will see them working for $4.00 an hour and not dismissed when the boss runs through his government subsidy.
Jobs and growth! It’s not that there are no jobs for young people after all, it seems. All our “vulnerable youngsters” need is a bit of work experience and a bit of benign neglect or worse. The system has no safeguards, no way of protecting those whom the treasurer calls our vulnerable young from being exploited by unscrupulous bosses. But then, what you expect from tokenism?
We learn also that in Morrison’s universe small businesses are now the leading employers in the land whereas in the real world big companies provide the most jobs.
Jobs and growth? The only jobs this mob cares about are its own; the only growth the cancer of false assumptions, canards, furphies and lies which choke the national conversation or worse become accepted as fact. News Corp is already on to it, but even they are having trouble finding a story.
Where’s the narrative? Amongst the commentariat and past- their use by date politicians it’s trendy to talk about the need to establish a narrative. It’s how you sell ideas, reforms, budgets. No coherent narrative exists in Morrison’s check-list of super, bracket creep, vulnerable young people, women, company tax, cities, multinationals, infrastructure . . .”
Nor is there a story in his prescription of discredited economic nostrums, such as the whopping lie of trickle-down theory upon which much of his gifts to businesses and high income earners, if not his entire world view are based.
One day, a reporter will challenge Morrison to provide evidence for his belief that making businessmen rich causes them to create jobs; his fantasy that making the ruling elite wealthier benefits anyone but themselves.
An economically literate treasurer would be boosting pensions and welfare payments and lifting the earnings of the lowest paid. Even the IMF knows that this is the way to promote economic growth.
Instead there is a host of porkie pies and wanton story-telling. Mercifully, however, nothing about his pal in New Zealand this time, however, the man inspired ScoMo last harangue with “how can I help you win today?”
Working out winners and losers, says the Treasurer, was “the old way. The Australian people have moved on from all that.”
Morrison convinces nobody. The main point of his budget is to pick winners and reward them. He has already said too much pre-budget about his mission to reward the heavy lifters – those earning over $80,000.
The Murdoch press is doing its best to help, even creating a post-budget Daily Telegraph wraparound featuring ScoMo as Superman. Yet is too late to save the job of the Treasurer, whose innate elitism and indifference to others colours his superficial, jargon-laden business hand-out of a budget on Tuesday as it does his abject failure of an address the following day at the National Press Club. Both performances serve only to confirm his colleagues’ opinion that the job is too big for the man.
Either that or the man and his party are on another planet, (which could be why there was no mention of a GFC we haven’t really got out of or climate change or the imperative to develop renewable energy anywhere in ScoMo’s spray). Planet unicorn, perhaps?
The 2016 budget is presented as Scott Morrison’s first economic plan, a shonky re-badging in case anyone twigs that although this government has been in power for nearly three years, only now do they come up with a plan. Or that the best they can offer us is ScoMo, the man with a plan, like his $5.5 resettlement plan for Cambodia to take our refugees.
Although once there was a mob of five now only one remains to attest to his plan’s success. But then, ScoMo’s take on reality has always been a little different, as on budget night when he says disarmingly things are not what they seem.
“This isn’t a budget,” he explains. “It’s a plan.”
But no-one is surprised. Nor are they really listening. Even on budget day, (is nothing sacred?), the Reserve Bank further assails whatever remains of Morrison’s credibility by lowering interest rates.
But, then, what would they know about the economy? ScoMo is here to tell us everything is going gangbusters. Why, the Federal Treasurer will even use meaningless statistics to further insult our intelligence.
Our economy last year grew by almost $40 billion and added almost 300,000 jobs.
The ABS, on the other hand, found that in the first three months of 2016, prices fell by 0.2% (the first such fall since December 2008) and annual inflation dropped all the way down to 1.3%: But what would they know?
Non-tradable items are showing record weak growth. In the past year, prices of non-tradeable items (such as takeaway food, rents, utilities, house prices, health and education expenses) increased by just 1.7% – the lowest this century.
If, as Morrison repeatedly claims, the coalition is the only party which knows how to grow the economy, perhaps it should take a long hard look at the fertiliser it’s using.
‘This budget will not be about a fist full of dollars, it will be about prudence, fairness and responsibility to our future generations,’
Morrison tells the Victorian Liberal Party conference in Melbourne on Saturday although his budget gives away $4 billion in order to protect us from bracket creep, but only if you happen to be in the $80,000 PA bracket, an income group the treasurer is staunchly pretending is average.
In this delusion ScoMo is supported by his PM who doesn’t know anyone who doesn’t have a rental property, an income above $80,000, and who doesn’t own a cracker of a small business. Neither cares that we lead the world in inequality.
In a world of widespread worsening inequality, Australia is in the lead. Compared to the average for OECD countries, income inequality is growing significantly faster in Australia. The Productivity Commission’s study of economic gains from 1988 to 2010, found that they disproportionately accrued to higher-paid workers.
Buoyed by his spaghetti western credibility, egged on by his PM, doubtless, our cowboy treasurer rustles up a posse of false assumptions including his belief that falling off a resources boom cliff is really “a glide path to jobs and growth”.
Australians know that our future depends on how well we continue to grow and shape our economy as we transition from the unprecedented mining investment boom to a stronger, more diverse, new economy.
Transitioning! Like Good Captain Abbott, Morrison is a dog with a bone when it comes to the t word. Yet there is little evidence of transitioning to a stronger economy; of any sector taking up the lead once enjoyed by mining. Experts have been looking for it for years. A year ago the ABS forecast investment in the non-mining sector, excluding manufacturing, would fall by 8.1 per cent in the 2015-16 financial year.
What is keeping Australia from recession is the tail of the boom and the property and construction market in Sydney and Melbourne while the health care social assistance sector remain strong because of our ageing population. Construction is predicted to slow by next 2017.
The Australian economy is expected to grow at 2.5 per cent in both 2015-16 and 2016-17 before strengthening to 3.0 per cent growth in 2017-18 as the detraction from falling mining investment eases.
No mention from ScoMo on what precisely will drive this growth or ease this detraction. (You have to love the language)As Australia Institute economist Richard Denniss warns predictions are what economists can never agree on. Or get right. Anything after six months is generally flim-flam and flapdoodle.
Yet the facts don’t matter to the coalition’s divinely ordained mission to better economically manage us and Morrison is relaying a gem from the party’s suppository of wisdom. “Our objective is to transition people from one good job to another good job”, Tony Abbott said happily in 2013 – spookily predicting Joe Hockey’s good fortune.
Talk about “de-risking unemployment”, to use ScoMo’s cute new buzz words. If only it were so simple. Nowhere in his speech does he acknowledge that there are at least 700,000 Australians unemployed and about the same number underemployed. The best he can boast is that submarine building will create jobs in something he calls...
A defence plan for local hi-tech manufacturing and technology
Yet this is not how defence contracts work with overseas-made specialist equipment netting profits to multinationals and small workforces. For example, despite the cost of the project, the most reliable forecast suggests that only 2800 jobs will be created in South Australia, when DCNS the French based multi-national whose colourful past includes corruption scandals, starts to build submarines that despite the $50 billion price tag are just a concept at this stage.
Curiously we are building 12 submarines despite being able to crew only 6 and despite the Navy’s problems finding crews for its Collins class subs because fewer sailors are keen to spend three months at time underwater. As with any part of the smoke and mirror budget, it doesn’t pay to look at any of it closely.
Jobs and growth? If the government were serious about growth, why does the budget entail a 13% cut to industry programs when compared with last year? Why a 9% cut to the Australian Research Council?
The government has made a big ballyhoo of its National Innovation and Science Agenda which is to boost entrepreneurship and collaboration between business and universities. But it hasn’t put its money where its mouth is. The Abbott government cut $3 billion in research and innovation spending. Only 1 billion has been put back.
Much of the rest of Budget III is forgettable or a field of unicorns or fairy-floss and that’s the aim. It needs to be out of the public mind by the time the election proper begins. Also needing to be forgotten, dead buried and cremated is the underlying mythology of trickle-down economics and business tax cuts causing bosses to hire more workers or of young workers only needing a bit of work experience to get into the workforce. For these he may well be laughed out of office.
The craven vote-buying, the economic illiteracy or wilful blindness, moral blindness and the ignoring the needs of the average Australian in order to pander to the needs of the elite are less easy to deal with. These are never to be forgotten. Or forgiven.