Friday, May 15, 2015

Politics is a difficult game

I rarely mention Bill Shorten, but after last night's reply to the Budget, it's time that I did.

First, as a politician, I feel neutral about him.   He did come out strong when he was first making a name for himself, but it was later clear he was undergoing some terrible stress from being caught up in the Rudd/Gillard wars (as well as from a not insubstantial amount of turbulence in his personal life.)  

Some people find his delivery now too often "mannered", and I can see where they are coming from; but bloody hell, we had a three word sloganeering, unprincipled, windvane of an Opposition leader who got the top job, which I find more offensive than some flat "zingers".

As for his performance this year - he's caught in the perennial problem of how much firm policy an Opposition can announce ahead of an election without risking it being semi-adopted (or flaws exploited) by the government of the day.

I thought the speech last night was praiseworthy for having some actual content (unlike Abbott's speeches in reply), but man, it is such a dangerous game for Labor to be talking about any form of new spending without being 100% clear about its funding.

As for the aim of lowering small business tax rate to 25% - despite my ridiculing of Laffer, and the race to the bottom in tax rates that small government types refuse to acknowledge - I don't actually dispute that there may be room for corporate tax to reduce given the international comparisons.  It is a bit weird for Labor to be sounding like Laffer endorsers, although I see that Shorten wasn't talking about the overall tax rate for companies.  And listening to Bowen on the radio this morning, he did say Labor acknowledges that "it is not easy" to get to that rate, and hence the need for bipartisanship, and I guess that sounds like they are at least not being simplistic about all tax cuts paying for themselves. 

In a general sense, though, unlike the "say anything" and frankly anti-science approach of this government, I find it hard to credit that people don't think that Labor at least sounds like a party that genuinely thinks about the role government policy can take in moving the economy into new directions, with their emphasis on education and investment in technology.   The Abbott government thinks the future lies in roads and new dams in Northern Australia, and the future will look after itself.   (It's like the Ord River project never happened.)

On the other hand, one thing that concerns me about Labor is there reflexive objection to any increase to the GST.  If you ask me, a modest increase to 12.5% would not kill consumers but immediately raise substantial amounts:
Based on 2014-15 data, each 1 per cent extra on the GST would raise about $5.4 billion (increasing to $6.4 billion in 2017-18), meaning a hike in the GST rate from the current 10 per cent to, say, 15 per cent would add more than $25 billion per year to government revenue, escalating to more than $30 billion per annum within three years - if nothing else changed.
I really wish Labor would reconsider their position on this, but as I say, politics is a difficult game.

At least the major parties are both realists as far as being prepared to look at revenue measures (Hockey and his attempt at recovering more tax from transnationals, for example;  although his hit on the already exploited class of young international workers who live on gruel and $5 a day while picking fruit - I think I barely exaggerate - seems a very odd priority.)   Labor is on a sensible line in its desire to gain some revenue from the wealthy with millions of dollars in superannuation.   I suppose that's a vaguely optimistic note to end on.


Not Trampis said...

He is the ONLY Opposition Leader to be in front on a first term Government in the polls.

Surely the evidence thus far is that he is most successful Opposition Leader after their party lost government.

The ALP will not be showing up all the policies until the election because of the Charter of Budget honesty.

I am more concerned with some of the shadow ministers such as Kim Carr for example.

Steve said...

Yes his polling has been good, although I think one has to be cautious about how much of it is has been more about reaction against Abbott finding its way to the alternative.

The funny thing about Abbott is that I think his popularity goes up a bit whenever he's more scarce from the media.