During his concession speech after the 1987 federal election, the then Opposition leader John Howard remarked that in the aftermath of a ferocious election campaign it was important to remember that there was more that united Australians than divided them. It was one of Howard’s more statesmanlike utterances, and it spoke to the great liberal consensus of moderate decency that had underpinned Australian politics since World War Two. The problem with the Abbott government’s first budget is that it has inflicted damage on that consensus which may prove irreparable.

The old small-l liberal tradition has begun to look like one of those narrow rope bridges that run across deep ravines in the Himalayas, only now it’s dangling by a thread and flapping against the jagged edges of the neoliberal rock face. Meanwhile, the prince of moderation, Malcolm Turnbull, floats serenely above...