It’s a sign of how broken our politics has become if a new government won’t consider policies outside of its immediate budget targets
Veteran economist and one-time Bob Hawke adviser Ross Garnaut put forward some Very Big Ideas in last night’s Jobs and Skills Summit keynote address, in which he called on the government to use the nation’s challenges as a chance to embrace major reform. Australia’s economic situation was worse than most people think, he said, suggesting that we “stop kidding ourselves”. But, he added, the opportunities are immense, with Australia “better placed than any other country” to profit from an energy transition if the government invests as deeply in renewables as it did in the mining boom. Garnaut called for raising taxes to address our many crises, noting that taxation as a share of GDP was far lower than the developed average. Asked about Garnaut’s proposal of a tax on mining profits, Prime Minister Anthony Albanese and Treasurer Jim Chalmers were both quick to rule it out, with the PM noting that “times have changed”. Times have indeed changed – the world is at a crossroads, as Garnaut has pointed out. Can the Albanese government find the courage to seize the moment, as its Labor predecessors did, and as Garnaut directly implored it to do?
It’s understandable that the PM and treasurer were eager to rule out the “mining tax” when put to them in those terms. As RN Breakfast host Patricia Karvelas noted, Labor is “quite burnt” in this area, and she acknowledged that her guest Chalmers had been a staffer in the last government that tried to introduce one. Karvelas also employed the “times have changed” line, but in this case, as an argument to revisit a tax on mining profits. It’s fair to say that some of the journalists currently asking Labor about this idea would be the first to jump down the government’s throat if it said it was open to it. (These are the same people who would likely attack the government for “breaking a promise” should it announce an intention to repeal the Stage Three tax cuts.) But that simply isn’t a good enough reason to rule out a good idea. Getting rid of the tax cuts is the right thing to do, independent senator Jacquie Lambie said in a fierce spray at the end of her RN interview, adding that people would get over it if the government did it now. “You’re supposed to be a leader,” she reminded Labor. “You’re meant to make those tough decisions.”
It was also disappointing to hear both Albanese and Chalmers rule out revenue-raising reform and then immediately return to their “debt and deficit” rhetoric in order to lower policy expectations. The idea of expanding paid parental leave was “worthy of consideration”, the PM told Today. “But some of these issues, of course, are within the budget constraints.” Chalmers, meanwhile, continued to downplay the chances of bringing forward Labor’s childcare subsidies, noting the cost would be “prohibitive”, even though it would unlock women’s workforce participation and deliver economic dividends. Isn’t the cost worth it because of the dividend you get from women entering the workforce, asked Karvelas, pointing out the hypocrisy of the government praising the “game-changing investment” while refusing to bring it forward. “That’s not how the budget works,” Chalmers replied, adding that you can’t include in the budget all of the broader economic benefits that you expect to see from a particular policy.
The budget, sadly, does not work that way, and that’s not how our politics works anymore either. Balancing the budget – even when we are in eye-watering amounts of debt – is somehow seen as more important than nation-building, economy-growing reform, with Labor ever desperate to be seen as “responsible economic managers”. There is a sad parallel between Garnaut’s bold taxation proposals and the calls to bring forward the childcare subsidies to January 1. It doesn’t seem to matter to the federal government that these initiatives would pay themselves off in the long term if they won’t pay for themselves over the forward estimates. The budget is not going to be back in surplus for a very long time, and it’s not clear how exactly any government is going to bring it back to surplus. Now is the time for transformational, not transactional, leadership, as Judith Brett explored in her recent book.
Labor is absolutely “burnt” on the idea of a mining tax, and in so many other areas, with the party still not having fully recovered from the 2019 election loss. Its Jobs Summit has been a great public success, with the government this afternoon happily talking up the 36 “concrete outcomes” that came from it, not least reaching agreement on several industrial relations reforms. But it could have been so much more if ideas like Garnaut’s were truly on the table, if it had been about seeking out transformational reform. As the former Hawke adviser said in his speech last night, speaking directly to the PM and treasurer of today: “Some of your predecessors faced challenges of similar dimension, and left our country vulnerable by avoiding them. Others stood up to the challenges and set the country up for long periods of success.”
GOOD OPINION
Condition report
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“Obviously they’re not seeing the condition of our TAFEs down there. We still have machinery from the 1950s.”
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Tasmanian Senator Jacquie Lambie says facilities need to be brought up to scratch in order for the government’s additional 180,000 free TAFE places to make a difference.
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BAD OPINION
Doctors’ orders
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“Look, they’re doctors, so they have views, so do the different chief health officers.”
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Prime Minister Anthony Albanese dismisses the Australian Medical Association’s calls to release the health advice underpinning national cabinet’s decision to reduce the COVID-19 isolation period. It appears unlikely there was any such advice.
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7am Podcast
The truth about the jobs summit: it’s the descent that kills you
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Will Labor’s Jobs and Skills Summit live up to the hype? Anthony Albanese wants to make policy that’s good for workers and for employers, but the days leading up to the summit were full of tension between business and the unions.
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The figure to which the government will lift the permanent migration cap, committing $36.1 million to clear the visa backlog. Business and unions have welcomed the boost, while the Opposition, which was recently in government, is complaining that it took too long.
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The Policy
Roundtable to tackle agriculture workforce issues
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Agriculture Minister Murray Watt has announced a new agreement for a roundtable group of government, farmers, meat processors and unions to deal with workforce issues. The National Farmers Federation has praised the new agreement, and hit out at the Nationals, saying that farmers had become “sick of waiting” for changes under the previous Coalition government.
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