25
May
2016

Election Proposals Omit Structural Reforms Too

My Commentary sent out late Sunday (thanks to those who sent compliments) drew particular attention to the article by Judith Sloan on the Federal budget and her conclusion that “Labor is completely out of control fiscally; the Coalition is slightly better but no cigar”. This followed other strong critiques, including by John Stone.  Meantime we have Turnbull and Shorten buying votes as they go from electorate to electorate and adding up to $100mn a day to budget spending. What does the odd million matter?

Now Judith has written an equally devastating article on the bipartisan failure to either implement or propose significant structural reforms (see below). My favourite “missing” policy is workplace relations and it is relevant that today’s The Australian leads its Talking Points with five letters on that issue (see Letters on IR Reform). While Turnbull has a bad record on workplace relations, it is astonishing that he has so far made only very limited use of the Heydon Royal Commission. Shorten must feel (to use a Turnbull phrase) “very very” relieved. Of course, Turnbull did use the Senate blocking of legislation to tighten regulation in (mainly) the construction industry as the vehicle for calling a double dissolution. But why stop there? Reform is needed across the whole area of workplace relations.

There is one reform item which Sloan failed to mention, doubtless because she judges it would be a No,No politically. I am referring to global warming, on which Turnbull agreed to stick with the policy Abbott had endorsed but which he would like to change. My view is that there is an opportunity for those candidates who are sceptics to say publicly that Australia may have to modify its climate change policy if Trump becomes US President, which is now a real possibility (one US opinion poll shows Trump equal with Clinton). While Trump tends to change his policies quite frequently, there is significant questioning in the US of the extent of the global warming threat (this extract from a Pew Survey in the US made just before the Paris Conference shows that only 20% of Republicans regard CChange as a “very serious” problem and no more than 50% support action to limit emissions).

Here in Australia there are significant numbers who are concerned about the adverse economic effects of measures limiting emissions, notably on electricity prices, which are already being taken to (supposedly) deal with the alleged threat even though Australia only emits about 1.3% of total world emissions. Even Turnbull has criticised as excessive  proposals by Labor and the Greens to (in particular) more rapidly increase the use of renewable energies from wind and solar sources(which are two to three times more expensive than fossil fuels).

Coalition candidates in this election who have sceptical views of one degree or another do not need to indicate that they oppose limiting emissions. All they need to say is that they oppose proposals by Labor and the Greens because they judge it wise not to take further measures than the government has announced as Australia would need to review its policies if Trump becomes President. Such statements could set a different atmosphere on global warming policy after the Australian election.   

Where to now?

There are major responses to PEFO and the Newspoll showing Labour as possible winners. The left-wing media (The Age, SMH, and ABC) is running the line that the deterioration in support of Turnbull is because he has failed to show the “real” Malcolm ie the progressive Malcolm. But writing in today’s Australian, Greg Sheridan argues that is “100 per cent wrong” (see Sheridan on Turnbull). He argues that Turnbull must change to be leader of the centre-right of the party and that, if he doesn’t,  even a win would give him reduced authority and the strength of his authority would be “very problematic”. Put another way, the strength of the Coalition will be much reduced and Australia will face another period of poor governance and miniscule reform.

Another article in The Australian (by Troy Bramston) claims Turnbull is “not a natural politician” and that there is a disaffected section in the Liberals (one might add the Nationals) who won’t vote for the party or will temporarily switch their allegiance in the Senate. There is no doubt that a large number of Coalition supporters have this in mind if Turnbull continues on his present path. Bramston even canvasses possible leaders if the Coalition loses the election. He concludes that “a return to Abbott post-election cannot be ruled out” (see Bramston on Abbott).

As I went for my morning walk through the Botanic Gardens this morning a flock of twenty or so birds winged by and, after swirling around, settled on a damp piece of grass hiding the worms. And, as Milton Friedman once observed about bird flocks, this flock was led by a bird that knew where to find the worms.  We are certainly missing that bird in this electioneering. Are there any in the flock who might persuade the leader where the best worms are?

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