Budget 2014: putting the con in economy

The Abbott Government’s first budget, like most federal budgets, is based on a confidence trick. But this one has been executed with such bumbling incompetence that it won’t fly with the electorate.

The budget’s narrative is the hoary old claim that ‘all Australians will share the pain’ in restoring the national economy. But a simple examination of the budget papers demonstrates this isn’t true: the heaviest burden falls on the lowest paid, middle earners, students, unemployed and older citizens. The millionaire and billionaire class, the top one per cent, escape with a contribution amounting to small change.

Adding to the anger of voters, Abbott and his ministers are sticking to the line that they have not broken their election promises. Every time this is repeated on radio or television, Abbott’s popularity rating sinks. Is continued deniability a sustainable option?

The Coalition harnessed a raft of spinmeisters and PR gurus to make the budget ‘saleable’ by attaching bells and whistles, such as the Medical Research Future Fund and a $50 billion Infrastructure Fund.

The purpose of these headline-grabbing items is to hide:
1) the cruel attack on living standards of working people and
2) the wrecking of the social services that protect poorer households from the poverty line.

The 2014–15 budget has to be seen as the first in a succession of Coalition budgets to reshape the economy, introducing a US-style free market model and burying the mixed economy with its vital public sector.

When Treasurer Joe Hockey told Parliament, ‘There’s still much work to be done’, he wasn’t kidding. Next May he will advance the second stage of his attack with the privatisation of public assets such as the Post Office, the Royal Australian Mint, Crown land and public utilities.
Another purpose is to starve the States and Territories of funds for education and health and force them into an unholy alliance to demand an increase in the GST – which Abbott will take to the next election.

The Coalition is gambling that there will be no major upsets in the world economy over the next couple of years (neither the IMF nor the World Bank are prepared to make such a risky forecast) and that Bill Shorten’s Opposition will be unable to mount a coherent strategy to reclaim government at the 2016 election (a safe bet).

The budget’s credibility sank the day that Tony Abbott announced a 12-month pay freeze on the salaries of MPs and senators.

Just think about that: a 12-month pay freeze. Workers all over the country are taking pay cuts to hang onto their jobs while there are 713,000 workers currently unemployed. Sharing the pain? Give me a break – a pay freeze is existential to them.

As ever, the biggest game-changer is the hike in petrol prices. It seriously impacts on the cost of living of every tradie, farmer, small business operator and average working families. And every time prices go up in Coles and Woolworths, shoppers will be reminded of Abbott, his gouging budget and broken promises.

What’s becoming ever-clearer is that this is an extremely conservative government led by a religious and political dogmatist. Australian voters aren’t used to that and they don’t like it.

After only eight months in office, Abbott and his barmy lieutenants – George Brandis, Christopher Pyne, Eric Abetz, Julie Bishop, Joe Hockey and Bronwyn Bishop – are causing deep disquiet among voters and the Coalition now occupies an election-losing position in some opinion polls.

The budget will only increase the electorate’s gathering suspicion of the Coalition, exacerbate social divisions and undermine Abbott’s demonic hold on the prime ministership. Meanwhile, the leadership pretenders – Communications Minister Malcolm Turnbull and Immigration Minister Scott Morrison – are both watching Abbott’s gamble with vigilant interest.

Alex Mitchell

Alex Mitchell is former state political editor of Fairfax Media's Sunday newspaper in Sydney, The Sun-Herald, and author of Come The Revolution: A Memoir (NewSouth Books, 2011).

More by Alex Mitchell ›

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  1. Thanks, James. Someone wrote a few years ago: “.. solving the global economic crisis and rescuing the planet have become indissolubly linked. I still believe world capitalism, based on exploiting human labour and ravaging the planet’s natural resources, cannot solve this awesome human dilemma, and that a socialist planned economy, organised in the interests of people and the environment – and not profits for a few – remains the only practical answer.” Oh, it was me. Alex

  2. don’t be too pessimistic – there’s still the passage through the senate – this budget could be the making (or the breaking) of shorten, and labor

    1. Shorten – a former leading bureaucrat from Australia’s Weakest Union (AWU), and current boss of Australia’s second party of capital, a party whose raison d’être is class collaboration – this individual, and the corrupt organisation he heads will take us out of the neo-liberal wasteland to which the ruling classes have consigned us.

      Talk of a cargo cult.

      1. no kidding? notice i didn’t go under a ‘short game’ cipher (person of no power or importance)- anyway, something radically different, something other, is going to happen ex nihilo, through wishful thinking? simply describing a possible process of change, one way or another

  3. Ex nihilo, out of the labor party, and wishful thinking that the bureaucrats, stuffed shirts and ciphers who control that organisation care for anything but their own careers, gold plated pensions and .

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