Democratic processes


Did my civic duty early and voted today in the Victorian state election. Election day is not till the 24th, but there’s always a rush on the day, besides, I’ll be away on a golf weekend. Good to get it out of the way, and an easy decision too – one of the candidates gets things done, the other is a ratbag.

As usual, there were people handing out flyers with earnest persistence. I escaped the clutches of an eager Socialist asking if I knew about the “upper house deals being done.” I told her I knew all about it – a slight fib, I know some, but the truth is I know all I want to know about it.

I stood in line and as always refused every bit of electioneering guff with a polite no thank-you. It’s a waste of paper and I always know who I’m voting for regardless. It’s fascinating nonetheless. The unassuming Labor types, a grim-looking woman telling us it was time to ‘take back control’, another earnest and passionate Socialist I’d happily share a bottle with, and a lovely middle-aged woman who seemed to epitomise the Greens.

It took me back to a time – many years ago – when I was one of them. I’ve written about this before, so will keep it brief. I was a scrutineer for the republican movement for the referendum in 1999. It was an interesting and unexpected experience – I became ‘it’ because there was no-one else there to do it. I set up that morning stringing our banners up early on a cold winters morning and ahead of our monarchist opponents who arrived after I did. Take that royalist scum, I thought.

On this occasion, the royalist scum happened to be a lovely, reasonable man who’d had the foresight to bring a thermos of hot coffee with him. When he offered me a cup midway through the morning I hesitated, wondering if I would compromise my political integrity if I accepted it. I was easily bought it seems, and that little episode has informed much of my political thinking ever since. We demonise our opponents when they’re in the abstract. Face to face we realise often they are reasonable people with a view a little different from our own. I guess it’s about respect, ultimately. As it happened this guy was not against the republic per se, just against the model being voted on. That’s all down to John Howard, a man I have no respect for.

Funnily enough this week I had a passing thought that I would nominate as an independent senator prior to the next federal election. It wasn’t entirely random, I’ve thought about it occasionally in recent times – and why not? I’m informed, I’m informed and I’m educated – which is more than can be said for much of the riff-raff being voted I these days. I’d like to make a difference.

Even if I did nominate it’s a million to one against being voted in, but I’ve got a lot better chance in the Senate than in the house of reps. It’s unlikely I’ll do it, but don’t say I didn’t warn you.

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Tide is turning


Many years ago I lived in the Wentworth electorate. It’s a wealthy part of the world but is also very pretty. I lived in Watsons Bay, just about on the tip of South Head. Watsons Bay has a quaint appeal, a bit sleepier than the more glitzy suburbs of Vaucluse and Double Bay down the road on the 325 bus.

I loved living in Watsons Bay, so much so that most visits to Sydney now include a visit there to sit in the beer garden of the pub, or walk along Gibsons Beach, as so often I did back in the day.

Wentworth is in all the news today because yesterday, and for the first time, someone other than a Liberal MP was voted into federal parliament. This is a notable moment in Australian politics and marks – I hope – a turning point. Up till yesterday, Wentworth was the safest of blue ribbon Liberal seats, and it took a swing of historic proportions to upset that. Hopefully, it is a harbinger of things to come.

As I do with most notable elections I set myself to watch the developments last night from the comfort of my couch. By little after 7 it was all over – the pundits declared the seat for Kerryn Phelps, the Independent, and I switched over to watch the A-League.

The result last night was the bitter pay-off for the nasty and underhand shenanigans that led to Malcolm Turnbull, the prime minister and Wentworth incumbent, being deposed. He was a popular member in an electorate better educated than most, and more progressive than the usual Liberal seat. He embodied their small l liberal beliefs, and they were angry.

The whole thing is symptomatic of an utterly dysfunctional Liberal party. They trailed in the polls when Turnbull was in charge, but he was the more favoured leader. Many in the electorate had been disappointed by his performance but retained a belief that he shared similar values. He was the acceptable face of an increasingly toxic coalition. That small bonus became a negative once he was ousted and, after a farcical few days, the utter buffoon Morrison became PM.

Since Turnbull was ousted Labor have increased their lead in the polls. A safe seat has had an unnecessary by-election and been lost that would have been easily held otherwise, resulting now in a hung parliament. An urbane and intelligent leader has been replaced by a hectoring buffoon so generally incompetent that you have to question how he ever made it so far. (I can see him running the local newsagency, but that’s his limit.) Policy making is on the run, reactive to events and polls and primarily concerned with shoring up crumbling support – even so, it is so badly misjudged in intent and executed so poorly that it leads to contempt and ridicule.

This is the big takeaway out of this result. The people of Wentworth have protested. They’re unhappy with what happened with Malcolm, but they’re also sick and tired of a shambolic government that doesn’t represent their interests. Big issues for the electorate were climate change and the refugees on Nauru, issues the Liberal party is disdainful of.

This is why I think the worm may have turned, though it’s taken much longer than it should have. The government has been allowed to get away with general inaction on these topics till now. News Corp has had their back and much of the rest of the media has been pliable (they don’t break news any more, they report it only after it has finally broken). Lobbyists and other interested parties have been in the ears of government ministers and plying the party with donations. And, of course, the RWNJ wing of the party has been vocal and generally destructive in support of retrograde policies. More broadly, there seems to be a mistaken belief inside the party that their so-called ‘base’ is on board with their policies.

Let me break the news. Most Australians believe climate change is real and want some action. Many of us have for years called for asylum seekers to be treated more humanely. The base they allude to is no more than the raucous jeering of conservative ratbags on the fringe of the society, given a megaphone by Rupert Murdoch’s press. This is not Australia. This, certainly, is not Wentworth. This is now, and if they’re smart enough the libs will realise it – but they won’t, and even if they did the kamikazes on the right would sabotage it regardless. The Libs are dead.

I’ve been wary of saying that, but I feel as if the tide has turned. The overwhelming result yesterday is testament to the impatience of the Australian people. If this can happen in a safe Liberal seat, what lies in store across the land? This genie is now – finally – out of the bottle.

I seriously wonder what will happen to the Liberal party. About 18 months ago I raised the prospect of a complete fracture within the parliamentary party. I still think that is very possible, and potentially inevitable. The ideological schism between the conservatives and moderates is too great and too bitter to go on. I can see the conservative faction breaking off to become a traditional conservative party and aligning themselves generally with the likes of One Nation and Cory Bernardi. They’ll take their inspiration from Trump – and there’s a lot of Trump in recent Morrison edicts – and pursue their hardline agenda.

That will leave the moderate rump of the Liberal party remaining – that’s the party of Fraser, and Menzies before him, and Turnbull if he was still around. It’s the party I would flirt with voting for – economically conservative, socially liberal.

If that was to happen it would have a domino effect. The Labor party would have to re-position themselves, probably slightly more to the left than at present, which wouldn’t be a bad thing.

As you may gather, I’m greatly heartened by the signs. We still have another six months of this government, and anything can happen – but I feel in my heart as if we might just survive the general conservative, reactionary, Trumpian fervour that has engulfed so much of the world. Fingers crossed.

 

Musical chairs


In the end it was quite comical. Leadership of the Libs came down to a game of musical chairs, and when the music stopped Morrison was the new leader. He’s basically the Stephen Bradbury of Australian politics. After all the in-fighting and backstabbing, the striving, the bullying, the bellicose statements and brazen defiance, it was the man who had said least, the man who had actually stood by Turnbull when others abandoned him, who ended up being the man to replace him as Prime Minister.
One of the funniest aspects is that Peter Dutton, who contrived this ridiculous challenge and was so aggressive in promulgating it, set it up only to have someone take the prize. The Stephen Bradbury analogy is apt as everyone fell down leaving Morrison the last man standing. It was shoddily done by Dutton and his lieutenants and leaves him with egg on his face and potentially mortally wounded, but it also leaves the body politic in a much worse position.

The government itself is damaged to the point that it would take a miracle for them to be re-elected. Their credibility is shot to pieces and they’re stuck with a bumpkin as prime minister. And they’ve lost some of their best performers.

Much as he was hated within the party, and even if he was disappointing to many without it, Turnbull was one of the main things they had going for them. A poor politician, he was also clearly intelligent, articulate, and though ultimately irresolute, a decent man as well. Most with an open mind recognised that, and even as a confirmed critic of his I have to say I like him personally and am sorry to see him go out like this.

As well as him, Julie Bishop has stepped down, soured by Machiavellian machinations of the party, and the personal disrespect shown to her through this process. She and Turnbull were the two most popular members of the government and like that they’re gone, kaput! The talent has thinned further with their departure.

I seriously wonder if this will be the end of it. The conservatives of the party, having worked themselves into a fury, are left empty handed. They’re a bitter, angry lot and I’m certain they won’t let it go at this. They have only one objective in mind, getting one of theirs into the top job. Stay tuned.

The reasonable thing would be to call an early general election, but no-one expects that. Unless there’s a dramatic turnaround our next government will be Labor, though not until May next year.

A final word for Tony Abbott and Rupert Murdoch. Both of them are a scourge on Australian politics. Almost single-handedly he’s brought Australian politics to its knees. He’s a pox and in years to come will be seen as the destroyer he is. He has been aided and abetted by News Corp and their rum lot of so-called journalists, ratbags almost to a man. They’re led by Murdoch who sees power as its own reward and wants his version of the world to be represented and will do whatever he can to achieve it. Hence Donald Trump, and almost Peter Dutton. The day he dies will be a day to celebrate in many places in the world.

Huns at the gate


I’ve been following Australian politics for many years. Against my better judgement occasionally I’ve found myself drawn to the drama and conflict, the dynamic personalities and shifting narratives. There’s something Shakespearian in the play of politics, and that’s nowhere truer than in Australia.
In recent years the conflict and often bitter hostility has risen to a febrile pitch, both fascinating and terrible. It has become destructive and ugly and all-consuming. Though no-one seems to comprehend it at the time, there are no winners out of this – not the striving figures on competing sides, policy suffers, as does society, but the biggest losers out of this are the Australian public, who are entitled to expect better. It’s always been fascinating, but nowadays it’s a duel to the death.

For all those years following our politics I’ve never witnessed anything like what’s happened in the last few days. If you were not so dreadfully involved in how things play out you might see the sheer comic lunacy of some of the players and events. Certainly it’s farcical, but it’s also disgusting. Laid bare are the naked ambitions, the scoundrelish disloyalties, the petty selfishness. Few come out of this with any honour and it’s clear to anyone but the most blind that the good of the nation comes well behind individual opportunity in the eyes of those we have elected to serve us.

At some stage today or in the next few days it’s almost certain we’ll have a new prime minister. Who that is is anyone’s guess. It could be Dutton, the man who started all this, or Morrison or Bishop, or maybe even Abbott, god forbid. You never know, Turnbull may even survive by some miracle. Basically despite all the shenanigans of recent days, anything is possible, and good government has been suspended, both literally and figuratively. However it turns out a general election should be called soon after to be decent, but I don’t expect that.

What we are seeing is a war between the moderate and conservative factions of the Liberal party. Turnbull leads the moderates and had he been less compromising and more ruthless this situation might never have arisen. Like Chamberlain in 1938 he seems to have been under the delusion that he could negotiate with the devil. The problem is – as any savvy person knows – the more you give the devil, the more he wants. And the more he despises you. That’s Turnbull all over though – no political judgement.

Bishop is a moderate too, capable and articulate and relatively popular in the electorate, and hated by the conservatives. She’s a better option than Dutton or Morrison, but I don’t know if she’s up to being PM. To be honest, I don’t think she has the desire for it really, and fair enough.

Let’s discount Morrison who, even if he becomes a stand-in PM, is an incompetent buffoon. He’s a pragmatic conservative no-one trusts.

Then there’s Peter Dutton. He represents an existential threat to the Liberal party as we have come to know it. I’ve written about him before. He’s cold and calculating, a shrewd and ruthless operator beholden to a conservative ideology foreign to most Australians, but shared by the hard right rump of the Liberal party. They’re climate change sceptics, were against the same-sex marriage legislation, and in some cases promote a narrative verging on the racist. They’re in the pocket of big business and so promote old technologies such as coal fired power stations against cleaner and more efficient options – yet it aligns with their backward looking philosophies. They promote a toxic line that diminishes the people outside of that bracket – the many, if you like – concerned with getting the pay-rise long delayed while having their penalty rates cut. They are egged on at every step by News Corp, who are a pox wherever they set foot.

The first problem is this is not the government the people voted for. They’re blithely arrogant believing they know best, but a great portion of the Australian electorate are hostile to such a conservative ideology. If Dutton was to get up today or tomorrow and then govern until next year when the next election is due, then we the people will be subject to a government that few want.

The greater issue is what this means for the Liberal party. I wrote many months ago that I could see the Liberal party splitting into two. The problem, as I saw it, was the right wing ideologues are fanatics. They broach no opposition. They won’t consider an alternative view. They sneer at the moderate snowflakes. It’s their way or the highway. There’s no compromise in them, and ultimately little practicality. They are the poisonous right wing version of Keating’s basket-weavers of the left, unwilling to deal even if it means political death otherwise.

The only way the Liberal party survives as an entity is if the conservative edge of the party consumes the moderates, but no-one sensible wants that because it becomes a different party. It becomes a narrow party of the right full of hardliners; the moderate middle dies.

We don’t want that because it would be bad for democracy, but the alternative as I see it is that the two factions hive off. The conservatives go further to the right, embracing fellow travellers like One Nation and joining with Cory Bernardi’s ratbags. The moderates make for the sensible middle – the place Turnbull always wanted to sit, slightly to the right of the ALP (but just marginally these days – Labor has trended right too). That might be the best option.

What happens, I don’t know. Worst case scenario is that Dutton becomes PM and we’re stuck with him for the next 9 months. Best case scenario is a general election is called so we can sort this out sensibly. Somewhere in the middle is Bishop as PM, or even Turnbull surviving, not perfect, but better than the Huns.

Deadly depressing


As always, reluctant to comment on the circus that is Australian politics (world politics is no better), but given that Turnbull has just survived a leadership spill, feel I must.
It goes without saying that Malcolm Turnbull is pretty much the most disappointing politician in living memory. Not the worse – though he’s pretty hamfisted, and certainly not the most evil or stupid, he is just about the most cowardly.

Here is a man of great intelligence and achievement outside of politics. He’s urbane, articulate, a tad verbose, but certainly clever. He’s not without principle either – I’m certain he believes in things, and probably pretty worthy things too. His fault is basically he’s a scaredy cat with very poor judgement.

This latest leadership crisis is largely of his own making. You can certainly blame the hard right of the party, and Abbott in particular, for fostering discontent, but Turnbull might have headed them off had he shown a bit of fortitude and chosen to defy them. It’s the same old story, though. He gives in to them, seemingly unable to comprehend even after numerous opportunities to learn: the more you give, the more they want.

This is the pattern of his prime ministership. He wants to do things but is too afraid to do them, and so he obfuscates, he hesitates, he equivocates, and ultimately he gives in, compromising his principles for the sake of political unity. It’s a tough gig with such a recalcitrant bunch of hillbillies heckling from the right, but if history has shown anything kowtowing to them achieves nothing.

You wonder what might have happened had he acted with more authority. What if he chose to govern in the interests of the electorate that voted him in? By and large he was voted for on the basis of his individual talents and generally more moderate voice – a voice that aligned with the views of most people. Had he shown strong leadership and resolve his standing would be much greater in the electorate and he would likely have achieved much more than he has. He’d feel better in himself and there’s a fair chance the right would have subsided or splintered in the face of such determined defiance. As a country we would be better off, and as an individual it’s unlikely he’d have had to suffer such tribulations.

All of this is what might have beens. He did none of that, and even his wanning personal appeal is based upon what might be rather than what is. It’s pretty clear now that what might be never will.

It’s funny this leadership thing. Pretty hard to manage. I think back to Gillard – a far more successful prime minister in terms of getting things done – who went through a long period being derided for not being herself. In other words, as prime minster she seemingly ceased to be the person who had appealed as an option. The sheer pragmatic reality of doing deals makes it tough, I’m sure, and I wonder if there is a form of stage-fright. I know it happens – look over my shoulder and compare my behaviour when I’m with a woman I like, and one I’m indifferent to. Caring makes a big difference, as does – I’m willing to bet – the ultimate responsibility.

None of that justifies Turnbull’s lack of leadership. It may be impossibly complex to him, but to those of us looking from the outside the choice is much simpler – do what you believe in, or go against it. Abide by what the people want, or instead bow down to the ratbags on the right. Till now he’s given in to the right – having survived the leadership spill I wonder if he will conduct himself differently.

In any case the future looks far from rosy for him. There’s a pattern to these things. The first vote the incumbent wins then, three or four months later, a challenge comes again and this time the challenger wins. Unless he does something about it that’s the likely outcome this time too.

One of his options is to call an early election to forestall any of that. The problem is just this week support for the government dived, and this spill won’t be helping it. His best option IMO is to push on, get some wins on the board, and then call an election. Otherwise I can’t see him going full term.

The lunacy of it from the LNP is that they have no other candidates worthy of the name. Dutton ran today, but he is widely seen as a cold-blooded nazi in the general electorate, with good reason – oh so cunning, but evil. His appeal is purely with the RWNJ’s. Morrison is a bumbling fool who can’t count without using his fingers and toes. Abbott is pure idiot, done and dusted. Julie Bishop is probably the friendliest option, but she shows little appetite for the job – and I think she would be exposed in it as well.

What’s the end game in all this? Right now it’s failed ideology and ego. The hard right conservative line won’t sell in the electorate, and Dutton might delude himself he can win but likewise most can’t stomach him. Ironically, the best chance the LNP of winning the next election is keeping Turnbull and let him have his head – but that will never happen.

Politics, it’s a deadly depressing business.

Go further


Further to my post yesterday there’s a report in today’s newspaper that Labor’s policy on dividend imputation could be implemented with exemptions to anyone over 65 – pensioners – with minimal impact to the bottom line. For mine this is looking more and more like good – and just – policy.

To be clear, what we’re talking about is tax refunds being given to people who haven’t paid tax. In very simple terms the current policy allows for people with a taxable income at level where little or no tax is applied to claim the difference on their share portfolio when tax has already been paid by the business. For example, if a company has paid their 30% company tax when they issue dividends then someone on a 15% tax rate can claim a refund for the 15% differential. For those with zero taxable income – for example, superannuation payments – then they can claim the full 30% refund, even though they haven’t paid a cent of tax. Obviously this adds up to a lot – billions of dollars, in fact.

This is a ridiculously generous policy that benefits a lot of wealthy and clever Australians, and does nothing for the economy. It’s overly generous when you consider that retirees already get their super payments tax free. In terms of the world, we are an outlier in this regard – most countries have much more sensible policies, as we did ourselves until Costello changed it (as a salve for another policy initiative that ultimately wasn’t passed). It used to be that the recipients of these dividends would get a pass on tax, rather than a refund – that’s what it should return to.

All commentary about double tax is tabloid nonsense, unfortunately some of it coming from the mouths of ministers who know better, and should be more responsible. It isn’t double tax, and in any case we are taxed double whenever we pay for something inclusive of GST. It doesn’t bear scrutiny.

As I said yesterday, I think it’s time for us to get bold on policy initiative. Times have changed and we are stuck with a bureaucratic, inefficient, out of date and unfair tax system. I support initiatives on negative gearing similar to what Labor has proposed on the basis that the current policy is inflationary, and more importantly, the benefit is to the few rather than the many. I don’t see the point in giving a tax-break to those who invest in current property. That’s a circular jerk, and there is no incentive to develop new properties, which is what we need. If we restrict the benefit to those who invest in new property only then it will have a direct bearing on the market. This is what policy should be about – not hand-outs, but shaping the economic landscape for the common good, and using incentives to encourage it.

There are a couple of other areas that need to be looked at. Stamp duty is iniquitous and as Ken Henry suggested, might be better replaced by a land tax, which would be much fairer. And I am in favour of a user pays model when it comes to car registration, which is a state issue. As it stands everyone pays the same amount of registration whether they travel a 100 kilometres a year or a hundred thousand. That’s unfair, but it also has an impact on livability. Theoretically registration fees go towards the upkeep and maintenance of roads and traffic infrastructure, and it’s only fair that those who travel most should pay more. The other aspect very relevant to our times, is that a user pays system of registration will likely take drivers off the road and into public transport. That’s good for the environment, good for traffic movement, and ultimately good for the bottom line because we can’t keep building new freeways, or adding new lanes to existing.

With all these things there has to be another, smarter way. Look again, go further.

Bold and revolutionary


Unlike most people, I find economics fascinating. It’s the science of it that first got me interested, which was back in high school. The thought that there were economic mechanisms that if enacted produced reasonably predictable outcomes was a wonder to me. I remember Keating – the man who made economics sexy for a while – talking about levers and buttons and stimulus as if it was a machine. As it became clear even in his time, it is far from an exact science, but that did little to diminish my interest – just the opposite. I came to believe that economics was a science in which human nature, sentiment and the voodoo of international affairs contributed their unpredictable elements.

I’m now at an age when I’ve experienced the application of economic theory for many years, and not just in Australia, but internationally. I retain my interest in it, but have formed my own views on it.

This is apropos recent economic discussion in Australia. I always welcome the conversation, even when it’s superficial, as so often it is. We should be talking about these things. Economic policy should be a matter we all take an interest in. It’s so easy in this political climate to bury our heads and take no notice, but if anything is ever to change than these serious discussions need to be common.

Unfortunately these discussions, as they are, are heavy on polemic and light on substance. And they are always contested, regardless of whether opposition is sincere.

A few weeks ago the company tax rate became a talking point. As tax goes, this is a bit of an old chestnut. The federal government wanted to reduce the rate to 25%, claiming it would make Australian business more competitive and attractive to investment. Most contentiously they claimed it would kick-start stagnant wages growth. The opposition ridiculed that of course, trotting out the line that the government only looks after the big end of town.

One of the arguments trotted out was a variation on the old, and long discredited trickle-down theory – in this case the argument went that if you give tax cuts then business will pass on much of that windfall to employees in the form of pay-rise. This flies in the face of experience. The credo of ‘shareholder value’ (a poisonous credo, btw) means that most gets passed to shareholders, rather than reinvested in the business, or to pay rises (excepting executives). Outside of the government you had such mediocrities like Jennifer Westacott and Tony Shepherd bleat on about it, a sure sign it’s rubbish.

As it happens I support the tax cuts now as I haven’t in the past, though not in the form the government proposes. With drastic tax cuts recently in the US and other parts of the world I think we need cuts to stay competitive. At the very least I think if cuts are to be implemented they should be tied to investment, and encourage wage growth (which is in everyone’s interest), but I would favour something bolder and more comprehensive than that.

Back in 2010/11 the then head of treasury, Ken Henry, produced a massive, detailed and bold proposal to overhaul Australia’s antiquated tax system. It was too strong, and too politically unpalatable for the mealy mouthed politicians of the day, and but a fraction of it was adopted. In the years since it is often referenced, and elements of it are coming into favour, and it is just the comprehensive approach we need.

I think the time has come that we must be bold, and look at left field, revolutionary solutions, rather than evolutionary tinkering. That won’t happen of course, because there’s no appetite for anything bold.

In recent days the Labor party has come up with a controversial policy to do away with dividend imputation and franking credits. It took a little while for me to get my head around this and form an opinion, but when you look at it closely it’s actually amazing to consider that this was ever implemented as a policy. It’s ridiculously lucrative, and extremely costly – and seemingly unnecessary. It’s complex, so I’m not about to explain it here, but fair to say I think this is a bold bit of policy initiative which – with some exceptions – I agree with. The country will be better off doing away with these hand-outs, and I think it’s inevitable they’ll be closed down, whether it be by Labor or Liberal. The only thing I would change is perhaps to incorporate a means testing element, or implement a threshold, as has been rumoured.

For me this would be a part of a larger taxation change that would allow for company tax rates to be cut, potentially to something less than 25%. Why not take the opportunity to get ahead of the curve, rather than forever chasing it? Together with some targeted policies addressing productivity, innovation, investment, in combination Australia would see a net gain to the bottom line, and a more agile economy.