Tuesday, December 17, 2013

The Coalition's budget decisions are all its own

There was a disturbing detail in a Dennis Shanahan piece earlier this month.  Describing concerns within the ministry about the performance of the government, Shanahan wrote, "It's fair enough to argue that 'getting to Christmas' is all that matters now."

"Getting to Christmas".  Almost an exact mirror of the motif of the Gillard Government, that "clear air" was just around the corner.

Labor was a tired government trying to be optimistic.  By contrast the Abbott Government should be — and is — a fresh new government facing many years at the helm.

Not every government is treated to as much wall-to-wall coverage of its hundred day anniversary as the Abbott Government has been.  But then, not every Government has had to learn so many lessons in as short a space of time.

One of those lessons is "try to avoid having former National Security Agency contractors leak Powerpoint presentations of Kevin Rudd-era surveillance missions on Indonesian politicians".  But too much of the Government's pain has been self-inflicted.

The expenses scandal didn't have to hurt.  Yet the government let it stretch for more than a month by refusing to engage.

The Gonski episode — let's be tactful and call it an ''episode'' — undermined the Government's most core promise:  that it would not break promises.

But probably the most damaging was Joe Hockey's decision to deny foreign investment to GrainCorp.

This decision stunk in many ways.  First, it suggested that the Nationals tail was wagging the Liberal dog.  Second, it implied that the Government's interest in economic reform was casual at best.

And finally, it showed that the Coalition was no better than Labor for business.  It was just as willing to play politics with the economy, and completely unwilling to stand against Australia's universally reviled foreign investment central planning.

The GrainCorp decision would not have cost the Government any votes.  But it cost a lot of goodwill.  The Wall Street Journal excoriated the government in an article titled "Tony Abbott's protectionist retreat".  Even worse was the subtitle:  "Australia appears to be closed to some kinds of business."

GrainCorp has a silver lining.  The fallout made it much less likely that the Government would increase car subsidies or buy out Qantas.  The Coalition's free market wing would not be able to stomach that.

After all this drama, it's no mystery why Tony Abbott's Government looks older and more tired than it is.

When the Government first came to power, Coalition spinners proclaimed Abbott wanted to slow down the news cycle, keep politics off the front pages, and restore calm to national political life.  Unlike his Labor predecessors, the Prime Minister would only talk when he had something to say.

This plan was fundamentally misconceived.  The news cycle isn't something that can be sped up or slowed down from Canberra.

It wasn't the Prime Minister's Office that built the content-hungry 24-hour news networks.  The Prime Minister's Office hasn't been hollowing out the newspapers' ad revenue base.  Nor is it to blame for the technological change that moved our news consumption online and created the demand for a constant flow of information.

No, the 24-hour news cycle was not Kevin Rudd's fault.

Don't get high on your own supply.  It's a saying that applies as much to political spin as it does to selling drugs.  And it's a saying worth remembering as the government tries to manage its way through today's release of the Mid-Year Economic and Fiscal Outlook.

Getting the budget under control is the central task this government was elected to perform.  More than stopping the boats, and more than the carbon tax, it was Wayne Swan's budget mismanagement which created the aura of policy dysfunction emanating from Labor.

But now the Coalition is talking, as it did at the tail end of the election campaign, about being unable to get the budget into surplus for another decade.

If that turns out to be the case — if the Coalition run deficits for 10 years, longer than the Labor government did — the failure won't be Wayne Swan's, it will be Joe Hockey's.

MYEFO is not "Labor's last budget statement", as the Prime Minister claimed yesterday.  It is the Coalition's first.

The Government has been on the back foot virtually since it was sworn in.  Its agenda was set by Julia Gillard and Kevin Rudd:  boats, debt, carbon tax.

And fair enough, of course, at such an early stage in the electoral cycle.  But its fixed agenda has left them struggling with the issues like foreign investment, car subsidies, and education.

What sort of government will the Abbott Government will be?  Unfortunately, after 100 days, that has become more uncertain.

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