As the treasurer lauds supply-side economics, a once-controversial recovery theory is gaining traction.This is the essence of modern monetary theory – that government budgeting is nothing like household or business budgeting, for the simple reason that government can create money.
Dutton serves as Labor’s Easter bunny
Being frontrunners in the election campaign, as confirmed by the latest Newspoll, has key Labor people nervous. They are uncomfortable with the almost universal expectation the election is theirs to lose or, worse, that Bill Shorten is already seen as the prime minister. It’s an expectation that has intensified the scrutiny and made Shorten – out of necessity – more defensive than he was last time against Malcolm Turnbull.
But Labor hardheads believe Peter Dutton is the secret weapon that will see them home. The Home Affairs minister’s greatest contribution to the Labor cause was his botched coup against Turnbull eight months ago. Its aftermath has left the Liberals in a world of pain. They are still attempting to recover and time is running out fast.
Scott Morrison is well aware his leadership rival from last August is a walking, talking reminder of the disruption that saw the Liberals give the nation their third prime minister in the party’s six-year incumbency. This undermines the credibility of the Liberals selling themselves as a stable outfit, one able to hold it together long enough to deliver on its key promises in the next term of government. Never mind that on a key issue exercising the minds of voters around the country – climate change – the government has sacrificed its credentials on the pyre of Turnbull.
So, even before we get to the arguments over tax and spend or slash and burn, there is a legacy of dysfunction that, try as he might, Morrison cannot deny or ignore. But try he certainly did during his foray this week to Victoria, sandbagging seats that, on paper, should be relatively safe. This hit home in the Melbourne seat of Deakin. Although it has a 6.4 per cent margin, its MP, Michael Sukkar, was Dutton’s numbers man and he’s been accused of bullying his colleagues in the process. Julia Banks, a firm Turnbull ally, quit the party soon after Turnbull’s fall and cited the bullying. She is running in Flinders against Health Minister Greg Hunt, who has a 7.1 per cent margin but carries the baggage of being on Dutton’s leadership ticket in the putsch.
The New Daily headlined that Morrison was “Sukkar punch[ed]” as he campaigned in Deakin. With a grim-faced Sukkar looking over his shoulder, the PM was asked at a news conference if the problems he was having in Victoria had anything to do with the local member’s judgement that “Peter Dutton should have been the leader of the Liberal Party?” Morrison is more than aware of the fact he sacked Sukkar from the ministry. He tersely replied that “was a bubble question, I will leave it in the bubble”. His problem is he is trapped in the same bubble he accuses the Canberra press gallery of inhabiting.
Labor wasted no time posting on its social media platforms an ad featuring Dutton: “With other right-wing Liberals he plotted against Malcolm Turnbull and voted to make himself prime minister twice.” It’s no happenstance Labor research has found “Peter Dutton is one of the most toxic people in Australian politics”, as shadow health minister Catherine King chimed in at a doorstop, doing the dirty work for her leader Shorten.
King homed in on Dutton’s attack on his Labor opponent in Dickson, Ali France. France lost her leg after pushing her baby’s pram out of the path of a car that smashed into her in a car park. King said it was a “disgraceful comment [by Dutton] that she was somehow using her disability not to move into her electorate”. Dutton took three days to apologise to France and Morrison didn’t call on him to do so. It was a curious reluctance on the part of the prime minister, who had previously become emotional over the plight of those with disability when he announced a half-a-billion-dollar royal commission into their treatment.
Dutton, unlike Morrison, did not run away from the August leadership disruption he caused. In a debate with Ali France on ABC Radio on Tuesday he said his judgement “was that we had to do whatever we could to stop Bill Shorten becoming prime minister”. He said Shorten was “very unpopular” in Dickson, the inference being he was more popular there. “He’s delusional” was the response of one Labor campaign worker. Certainly, enough of his Canberra colleagues shared this view, with Liberal moderates holding their noses and voting for Morrison to block Dutton’s push.
Dutton’s war chest to save his seat is believed to be in the vicinity of $1 million. He refuses to say how much he is spending but his face is splashed across every billboard in Dickson. A Labor insider says, “We are delighted to see his visage everywhere.”
If they are delighted in Brisbane, their joy is overwhelming in Melbourne.
Shorten on the campaign trail said the government three years ago urged everyone to vote for Malcolm Turnbull. “All of them – Mr Morrison, Mr Dutton – they all queued up to have their photo taken with Mr Turnbull ... Ever since they’ve had division, dysfunction and disunity,” he said. And then came the clincher: “The local member here in La Trobe, Jason Wood, he voted for Peter Dutton. He was happy to have Peter Dutton as prime minister but he’s not happy to have Peter Dutton photographed with him in his own electorate.” At the Victorian state election, Labor used images of Dutton, Morrison and Turnbull to scare voters in the polling booths. The anger over the coup may be abating somewhat – the polls have tightened – but the four-point gap has the Liberals in their election-losing position of the past three years.
Questions over stability keep dogging the prime minister. His stock answer is “the rules have changed” and he says, “If you vote for Bill Shorten, you’ll get Bill Shorten. And if you vote for me ... you will get me.” The Liberal rules require a bigger majority of the Liberal party room – 75 per cent Morrison says, compared with Labor’s 60 per cent – to then vote a leader out. Except it would only take 51 per cent of the assembled Liberal or Labor MPs to change those rules.
Morrison has the disadvantage of the new rules never being tested and the chaos exhibited in the past three years. Shorten can point to the fact he is now in his sixth year as leader “of a united stable team”. And just to put a cloud over Morrison’s assurances, Tony Abbott flagged at a voters’ campaign meeting this week he would be willing to lead the Liberals again. He would need to hold his seat of Warringah first, and there is increasing scepticism in the New South Wales division that he’ll do so. A Daily Telegraph attack on his main rival, Olympian Zali Steggall, backfired badly when her ex-husband and his new wife had second thoughts and withdrew harsh criticisms of her they had apparently given to the paper.
There is a view that the Easter break will be a dead zone for the campaign. “No one will take any interest until after Anzac Day” is one Liberal view. But that’s not shared by everyone and, while Labor and the Liberals will pull their radio and TV ads on Easter Sunday and Anzac Day, the leaders will still be doing media events. Labor has already seized on analysis by The Australia Institute of the impact of penalty rate cuts in the holiday period. It finds that workers will be $80 million worse off. Shorten is promising to restore penalty rates as part of addressing what he has identified as a major concern for voters: “Everything is going up except your wages.”
There’s no doubt Labor will seize on the Grattan Institute’s analysis of the cost of the government delivering on its signature promises of the election: lower, flatter income taxes and surpluses out to 2030. The independent think tank says they will cost $40 billion a year. To achieve that there will have to be substantial cuts in government outlays. Indeed, the budget papers themselves indicate the magic pudding can only be served up if spending is cut and wages grow at historically high levels.
Morrison rejects the analysis and is sticking by Treasury’s prognostications. But, as the Grattan Institute’s Danielle Wood says, Treasury is being “heroic” and she is not the only economist to think so. The fact the budget numbers are reviewed and adjusted every six months is proof positive these numbers are and always were assumptions or best guesses.
And, when it comes to the durability of tax plans, they are lucky to survive one election let alone three or more. The Liberals have abandoned their $60 billion corporate tax cuts – the ones they took to the previous two elections. Sure they tried to implement them but they are not taking them to this election, mainly because they realise they are electoral poison.
Shorten stumbled midweek when he promised Labor had “no plans” to increase taxes on superannuation. He later announced he should have said “no new plans” on top of the ones announced three years ago. Morrison accused him of being shifty.
But in the end it’s the Liberals who are nervous. It will need more than the odd Shorten gaffe to restore their credibility.
This article was first published in the print edition of The Saturday Paper on Apr 20, 2019 as "Dutton serves as Labor's Easter bunny".
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