Paul Bongiorno
Test for PM in Eden-Monaro

Unfailingly, since World War II, the voters in the New South Wales seat of Eden-Monaro have picked the mood of the nation at every federal election. Well, almost every election – 2016 and 2019 were the exceptions. Today those of the seat’s 114,000 registered electors who haven’t voted pre-poll will play the part of political weathervane, if not their more traditional role of bellwether.

Labor’s retired member Mike Kelly proved an iconoclast when he won the seat from an incumbent Coalition government and managed to hold on to it by his fingernails the second time around. His departure has put the governing Liberals in with a strong chance of winning the seat back, but nobody thinks whoever takes the prize will do so in a landslide. The sprawling and diverse electorate runs from the suburbs of Canberra down the Hume Highway to the Victorian border and all the way back up the coast.

The issues at play are the very challenges confronting Australians everywhere in this time of an unpredictable and devastating coronavirus recession. An Australia Institute poll conducted in the electorate mid-June found the economy was the most important issue facing the federal government at this time. Sixty-four per cent of Eden-Monaro respondents believed the $70 billion JobKeeper wage subsidy program should be extended beyond its scheduled September cutoff date.

Labor went all out to leverage this sentiment in its advertising. While it was clearly outspent by the Liberals, particularly on commercial television, the message could hardly be missed. As the voiceover in one ad instructed: “If you think small businesses need more support and can’t afford to lose JobKeeper just yet, the Eden-Monaro byelection is your chance to tell the Liberals that.”

Prime Minister Scott Morrison still needed convincing. He told talkback radio host Ray Hadley JobKeeper was “a cash burn of over $10 billion a month”. He lamented the latest budget deficit estimate to the end of May was already at $60 billion. “So obviously,” he continued, “we said at the time it was temporary. It can’t be sustained forever at that level.” He did give himself some wriggle room though, adding he’d have to look at what’s happening at the end of September.

Whether that is good enough for the 4800 businesses in Eden-Monaro that Labor says are being propped up by JobKeeper, and which employ 18,000 people, will be tested at the ballot boxes today. But the government’s reluctance to be more forthcoming has only provided ammunition for the sceptics. It’s been a week since Treasurer Josh Frydenberg received his department’s review of the program and its recommendations. Neither has been made public.

Shadow treasurer Jim Chalmers says the government is sitting on the review because it is concerned about a voter backlash. The argument goes: if there were not disappointing news in it, Morrison would have happily released it.

Adding to the anxiety for thousands who have lost their jobs and businesses is the other strong signal of a significant cut to the beefed-up JobSeeker unemployment benefit. Again, Morrison emphasises the cost. He says $8 billion has been spent on the more generous benefit along with the one-off payment to welfare recipients, which cost $5 billion. He even suggested based on “anecdotal feedback” the $1115.70 a fortnight payment was an “impediment” for people going out and looking for a job.

Morrison, of course, is caught between the Liberals’ two-decade-long demonisation of debt and deficits and the ballyhoo that only they are good money managers in politics. As an incisive analysis from Crikey’s Bernard Keane showed though, not one of the three iterations of the Liberal government since 2013 has reached the growth, productivity and investment levels of the Gillard Labor government.

Morrison has only eclipsed his Labor predecessors in the size of his deficit and record spending. This hurts and it is clear he is now trying to figure out a way to walk back from this image of spending like a drunken sailor. In fact, the more economically conservative figures on his backbench are pressuring him to do so – never mind that the Reserve Bank and any number of serious economists say more spending is needed, not less.

The Grattan Institute this week joined Deloitte Access Economics in arguing that more – previously unthinkable – spending is needed if the country is to avoid a recession that would inflict avoidable economic pain on hundreds of thousands of Australians. Grattan’s Brendan Coates told The New Daily that Australian governments “urgently need to develop an economic transition plan to take us through the next six months”.

The Grattan analysis, released last Sunday, said the government should inject a further $70 billion to $90 billion into the economy, in addition to the $160 billion already announced, to reduce the unemployment rate to below 5 per cent by mid-2022.

That just so happens to coincide with the next scheduled general election and could well be a plan for re-election. The multibillion-dollar question is will Morrison heed it? The Eden-Monaro voters are being asked to take a punt that his conversion to massive government intervention and Keynesian pump priming to cushion the blows is not just a passing aberration.

Increasingly, it looks as though dealing with the health side of the pandemic is the easy part. There are three federal budgets between now and the next federal election and all of them will demand very tough decisions. As Australia’s longest-serving treasurer, Peter Costello, told ABC Radio midweek, “In my experience, it’s easier to turn on stimulus than to turn it off.” Although he didn’t have to turn off much for most of his period in government.

Morrison this week was still addicted to his profligate ways. If he is to abandon them, he seems to be emulating St Augustine: “Lord make me pure but not yet.” The PM announced $270 billion over the next decade on a massive sci-fi arms build-up of hypersonic missiles and cutting-edge weaponry to combat the new menace presented by our biggest trading partner and hitherto economic saviour, China.

Upon closer inspection, the announcement was actually a re-announcement, a repackaging – with a small boost – of the 2016 Integrated Investment Program. Many of the projects are not scheduled to begin until the mid-2020s; already some announced four years ago have been delayed. The more bellicose vision encompasses three general elections and ties Australia to an increasingly isolationist United States gripped by Trump-generated Sinophobia that may survive the presidential election, even if the Democrat Joe Biden wins.

Anthony Albanese supported the “direction” of Morrison’s defence posture, especially its regional focus and the bolstering of our military capability. He, like Bill Shorten before him, is determined not to be wedged on defence and national security. No doubt the Labor leader, who has spent much of the past four weeks campaigning for the Eden-Monaro byelection, is also aware how potent the timing of the announcement could be.

Former soldier and intelligence analyst Andrew Wilkie, now an independent MP, was not so shy. From the safety of Tasmania, he said the defence spending announcement is “excessive and the timing curious”.

He added, no doubt tongue-in-cheek, that he assumed “the timing of the announcement is not unrelated” to the byelection, noting Eden-Monaro is the location – thanks to John Howard – of the Australian Defence Force Joint Operations Command HQ. Many defence personnel live in the electorate, Wilkie said, and “they’ll be delighted”.

Rather than defence, Wilkie said, “the cash needs to be really splashed” to deal with climate change, homelessness, health and education. He was not far off the mark on issues that The Australia Institute found were exercising Eden-Monaro voters. Climate change was second only to economic worries – 10 points ahead of health. This is significant although not surprising, given the searing trauma of the bushfires that still has much of the electorate reeling.

Labor sees climate change as the Liberals’ Achilles heel, especially as its candidate in Eden-Monaro, Fiona Kotvojs, has a reputation as a climate sceptic. She introduced the prime minister when they staged a campaign event in the Kosciuszko National Park on Tuesday to announce a “green light” for the Snowy 2.0 hydro project.

Morrison was effusive about Snowy 2.0 being a job creator for the region and a nation builder providing clean renewable energy. His candidate didn’t quite bring herself to mention its role in reducing dangerous emissions. And although the Liberal campaign has steered Kotvojs away from mainstream media interviews, or debating Labor’s Kristy McBain, she couldn’t avoid being questioned about her submission to the ongoing bushfires royal commission.

In that she made much of the role of hazard reduction in combating bushfires but no mention of climate change or reducing carbon emissions. She said she was speaking from her local experience in fighting the fires. She declined three times to say she believed climate change made the fires more intense, a view that has been propounded by the CSIRO and a group of retired fire chiefs.

Whatever the voters make of it all we will soon know. One thing is certain, byelections have a habit of changing the political narrative often in surprising ways. Eden-Monaro will be no exception.

This article was first published in the print edition of The Saturday Paper on July 4, 2020 as "Eden-Monaro temperature check".

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