Thursday, February 16, 2017

Today by Jim Middleton

Xenophon in their sights
The South Australian senator is a crucial figure in budget negotiations


Over the past two decades Nick Xenophon has risen from one seat in the South Australian Legislative Council, on a narrow anti-pokies platform, to three seats in the federal Senate and one in the House of Representatives, with a much broader centre-right agenda.

In the process, his vote in South Australia has climbed from less than 3% in 1997 to more than 20% at last year’s federal election. His success reflects not just the increasing disenchantment with major party political leadership but also the atomisation of politics and diminishing returns for the traditional major parties.

Xenophon’s increased support has been built on his ability to claim credit for taking the rough edges off government social-policy initiatives, as well as on opportunism, of which his advocacy for building the next generation of Australian submarines in his home state is the most egregious example.

South Australia is a state with not only high rates of unemployment and welfare dependency but also an embattled sense of itself. Where else are supermarket products festooned with labels proclaiming them to be “proudly” produced in their own “mighty” home state?

Sydney’s Daily Telegraph might believe it is doing Malcolm Turnbull a favour with a front page and an editorial excoriating Xenophon for “holding up the government while having negligible support from a state so ill-run that it’s essentially Greece with two AFL teams”.

But 21.74% of the vote – for Xenophon – is hardly negligible, and berating South Australians for their mendicant status is more likely to enhance his support in a state that already thinks the rest of the world is against it.

Xenophon has drawn support from centrist voters who believe Tony Abbott took the Liberals too far to the right, and remain disappointed that Turnbull has not been able to drag his party back to the centre, and who also have a sense that Labor does not have the answers either.

Xenophon had his doubts about the government’s latest omnibus bill – with its trade-off of cuts to family benefits and payments to the jobless in exchange for improved childcare – even before Treasurer Scott Morrison’s cack-handed attempt to link the whole shebang to funding the National Disability Insurance Scheme.

Nick Xenophon Team MP Rebekha Sharkie calculates that more than 7500 families in her electorate of Mayo would be losers from the proposed change to Family Tax Benefit A alone. And, as Labor discovered when it was working up the NDIS, far more voters were affected by disability than the numbers of disabled themselves would suggest.

The government has an inescapable structural handicap in prosecuting its proposals for budget repair. As long as it clings to tax cuts for big business it will remain highly vulnerable to the argument that the big end of town, rather than the budget, is the beneficiary of its hits to the poor, the jobless and middle-class families.

However successful the government has been in portraying Labor as the friend of higher energy prices, the proposed company tax cuts for the biggest corporates hang around its neck like Coleridge’s albatross.

Xenophon won’t support them, and all the indications are that he has his ear closer to the ground than the government does.

The AFR’s Phillip Coorey has suggested that the government is contemplating cutting the 50% Capital Gains Tax concession for property investors as something of a corrective to the “top end of town” accusations. This move would also begin addressing the issue of housing affordability that is also bedevilling the government and has some Coalition backbenchers tearing their hair out.

Or perhaps the proposed concession is simply part of a softening-up process, by a government preparing to blame Labor for Australia losing its triple-A credit rating, should that happen. Either way, is it likely that Turnbull – in his wounded state – will have any more success with selling the company tax cuts?

Possibly no more so successful than the Sydney tabloid that attempts to turn South Australians against the increasingly popular Xenophon by insulting their intelligence.

Today’s links

  • Donald Trump steps back from Washington’s long-time support for a two- state solution to the Israeli-Palestinian standoff. Meanwhile, reports emerge that the US may commit ground forces to northern Syria.
  • The economist who modelled an energy intensity scheme for Malcolm Turnbull’s Opposition in 2009 argues that state energy targets are the only way to reach Australia’s Paris climate-change commitments.
  • And another One Nation candidate in WA with interesting views on Muslims, gays and Indonesian journalists.

Jim Middleton

Jim Middleton is a Sky News correspondent and a vice chancellor’s fellow at the University of Melbourne.

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