The Politics    Wednesday, May 11, 2022

Playing us for mugs

By Rachel Withers

Image of Prime Minister Scott Morrison at Warners Bay near Newcastle today. Image © Mick Tsikas / AAP Images

Prime Minister Scott Morrison at Warners Bay near Newcastle today. Image © Mick Tsikas / AAP Images

The PM’s claim – that a fair increase to the minimum wage will blow up the economy – is as illogical as it is cruel

Prime Minister Scott Morrison and his acolytes seem rather panicked by Labor leader Anthony Albanese’s unexpected support for a 5.1 per cent increase to the minimum wage – a figure in line with inflation. What should have been an uncontroversial comment yesterday sparked a “political storm”, according to the Nine papers, while Coalition figures from Jane Hume to Stuart Robert have since declared that this was an unprecedented intervention into the Fair Work Commission. The AFR’s Phil Coorey, speaking on RN Breakfast, said that pegging wages to inflation (which no one has proposed) would be “a one-way trip to a Weimar Republic”, insisting that Labor had made a “blunder”. But it was Morrison himself who launched the most deranged attacks, accusing Albanese of being a “loose unit” on the economy, and asserting that such an intervention would send inflation and interest rates spiralling (an argument debunked here). “We all want to see wages go up,” Morrison said, insisting that the ($1-an-hour) increase Albanese was backing would all but destroy the economy. “He’s playing you for a mug,” added the man trying to tell workers who can hardly afford food that cost-of-living pressures will be worse for them if they get a pay rise. Turns out, it is the Coalition playing voters for mugs.

It’s bizarre watching the Coalition argue against a fair wage increase in the middle of an election campaign so focused on cost-of-living issues. As shadow industrial relations minister Tony Burke told News Breakfast: “The extraordinary thing about this story is not that Labor wants to make sure that wages keep pace with the cost of living. The extraordinary thing about this story is Scott Morrison doesn’t.” (Meanjin editor Jonathan Green quipped that “today’s killer line” for the government was: “Wages will always be lower under a Coalition Government”.) But more than bizarre, it’s infuriating to watch Morrison and co try to justify their opposition to an inflation-level increase by convincing struggling workers that they will actually be worse off with more money in their pockets. It’s a galling strategy, but one that might just work with commentators like Phil Coorey invoking the Weimar Republic.

It’s also deeply unfair to even make this link, as Centre for Future Work director Jim Stanford has pointed out. “Telling workers they need to just swallow a permanent reduction in earnings, as a result of inflation they didn’t cause, in order to prevent future inflation, is neither fair nor economically justified,” he said.

Meanwhile, Morrison’s insistence that publicly backing this increase would be economy-destroying doesn’t particularly gel with his other recent comments, in which he argued that Albanese didn’t have a “magic pen” when it came to lifting wages. Once again, it seems the government only has control of the economy when it suits Morrison to say so. What’s more, the Coalition’s assertion that Albanese’s support (which he hasn’t committed to making formal) represents an “unprecedented” intervention into the wage umpire’s process is simply false, as proved by a Guardian Australia fact-check showing that previous governments (including John Howard’s) have put a specific number on their submissions. As some have noted, this government made a submission to last year’s annual wage review, telling the Fair Work Commission to “take a cautious approach” to increasing wages. Then, of course, there’s the obvious fallacy in the Coalition claiming that the government shouldn’t intervene at all in the independent wage-setting process, while jumping up and down declaring that a particular number will melt the economy.

(Editor of The Monthly Nick Feik neatly summed up the Coalition’s contradictory stance on wage rises: “They’re good, but actually a threat to stability and living standards. Libs support them, but legislate for the opposite. Liberals want them, but not when Labor propose it. Libs control wages, but Labor don’t. Actually the independent umpire [does]. Obvs the Liberal govt will be responsible when you get more pay, but can’t help if you get less. That’ll be Labor’s fault, especially if they’re trying to raise wages. Which they can’t. But when they do, it’ll be a disaster.” Got that?)

In fact, today’s ludicrous argument is essentially the Coalition’s entire economic fallacy distilled: helping people will hurt the economy (but showering money on marginal seats, cancelled submarine deals and tax cuts for high-income earners in no way affects the economy). The Coalition and its media supporters have spent the day (but also the entire campaign, but also the past decade) arguing that Labor doesn’t understand the economy, and that those who might be pleased by Albanese’s latest announcement are simpletons (more or less exactly what Coorey said this morning). But the absolute stupidity of these arguments against an increase to the minimum wage should blow the lid off this myth. Albanese “sparked a political storm” yesterday by suggesting that Australians already earning the minimum don’t deserve to have lives that get harder and harder until they die. Let’s hope a storm really has been sparked here.

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Rachel Withers

Rachel Withers is the contributing editor of The Politics.

@rachelrwithers

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