Economy

Scott Morrison and his treasurer, Josh Frydenberg, don’t intend to repeat the Keating government’s mistake of crab-walking away from their key pre-election promises, not that they made many. Frydenberg still trumpets the $100 billion promise over 10 years for infrastructure, but is just as adamant he won’t be bringing any of it forward. He says half of it will be spent during the next four years. The RBA governor is looking for more stimulus now.

Already, the race is on for the next election. Both a jubilant Scott Morrison and a perky Anthony Albanese are off and running. Morrison has set himself the task of winning a fourth term for the Coalition, while Albanese is determined to learn from the wreckage of the unloseable election and keep the focus as much as possible on the government.

Along with the rest of the nation, Scott Morrison could scarcely believe it. His mother told journalists a lot of prayers went into the shock defeat of Labor, and her jubilant son told the cheering party faithful he had “always believed in miracles”. Four days later, though, the Reserve Bank governor played the devil’s advocate – Morrison’s “strong economy” was faltering.

In any other election, Australia’s headline economic figures would have the incumbent popping champagne corks. Twenty-eight years of uninterrupted economic growth, unemployment at 5 per cent, record-low interest rates and a budget in balance are close enough to a beautiful set of numbers. But the disconnect between the economic data and people’s sense of economic wellbeing has rarely been larger. And this economic ennui is proving fertile ground for both parties to push very different visions for the Australian economy and what the government’s role in it should be.

How much easier would life be for Scott Morrison if he was a Liberal prime minister seeking his third term in government? He could point to the delivery of an agenda outlined back in 2013 and his leadership of a united, cohesive team of senior ministers who have mostly delivered and become household names. Sadly, for Morrison, that is not his reality, and it is showing. He dare not mention the war.

Peter Dutton’s war chest to save his seat is believed to be in the vicinity of $1 million. He refuses to say how much he is spending but his face is splashed across every billboard in Dickson. A Labor insider says, ‘We are delighted to see his visage everywhere.’

The prime minister seems to have decided the best way to win over voters is to treat them like mugs. ‘Their problem,’ one Labor strategist says of the government, ‘is the voters aren’t as dumb as they think.’

Consolidated Newspolls show a swing against the Coalition in every state. Government MPs are hoping that the budget will give them some momentum to save them, but that is optimistic.

It could be argued, depressingly, that there is an inverse relationship between the growth of universities and the level of community engagement in politics. In fact, the level of political discourse was far more sophisticated in 1860s America than it is today in 2018 in either country. Lincoln delivered his famous Gettysburg Address in November 1863 at the dedication of a Civil War cemetery. I have long speculated what Lincoln might have said in 2018. Lincoln’s speech was only 272 words long. My draft here is exactly the same length.

During the past six years, real wage growth has all but ground to a halt in Australia. Just as in the first 50 years of the Industrial Revolution, productivity is growing at a solid rate. But employees’ share of the national pie has been shrinking. Part of the explanation lies in the fact that just 13 per cent of Australian workers are in unions, down from half the workforce in the early 1980s. Trade union membership is lowest among private-sector workers (9 per cent), 20-somethings (9 per cent), recent migrants (5 per cent) and people who have been working for less than a year (5 per cent).