Welcome to Quadrant Online | Login/ Register Cart (0) $0 View Cart
Menu
February 04th 2015 print

Peter Smith

Don’t Blame the Voters

When the electorate has no reason to trust long-term promises, the cynical acceptance of short-term bribes and blandishments is the most logical thing in the world -- especially when, as Abbott and Hockey refused to recognise, their budget was an exercise in unfairness and ineptitude

votersThe political theory, presumably, is that you won’t get into government by telling voters that you intend to sell public assets, put up taxes, cut benefits, sack public servants and end subsidies to uncompetitive industries. But you know that the budgetary and economic situation demands that these things be done. Enter the spin merchants with a deceptive, voters-are-mugs) strategy, pre and post-election.

The pre-election strategy usually comes down to saying that the incumbent government has messed things up and must be chucked out to allow better economic managers to take over. The offered alternative is all upside. The impression is given that it will leave voters better off and with a brighter future.

Voters buy the spiel and go to the polls looking forward to the new dawn of prosperity.

Then the post-election strategy cuts in. This usually comes down to saying that things are much, much worse than expected. Hence, the need for so-called ‘austerity’, which is reluctantly enacted. Public servants are sacked. Welfare benefits of various kinds are cut or made harder to obtain.

Subsequently a new election is held and the government is chucked out because of broken promises. Commentators arrive at the conclusion that voters lack the fortitude these days to accept the need for belt-tightening. They are only interested in getting free stuff.

This presents a chicken-and-egg problem. Did the voters start demanding free stuff, or did political parties take the lead in offering it? I don’t know but suspect the latter. In any event, I am not sure that Australian voters – the 10%  that decide elections — do lack fortitude, as much as political parties lack conviction and competence. We may be on the Hellenic Highway, but we are not yet Greeks.

I am not sufficiently up with Queensland politics to know why the government did so badly. But unheralded cut-backs undoubtedly queered the pitch. Of course, in the end result, federal politics didn’t help. Was the result such a catastrophe for conservatives because voters refuse to face reality? I don’t think so.

Joe Hockey and Mathias Cormann produced an unsellable dog of a budget and Tony Abbott went along with it. It broke promises. It introduced measures never mentioned before the election. It hit the unemployed and poorer sections of the community. It sought to penalise pensioners by progressively reducing the value of their pensions against community standards.

It contained the budget buffoonery, hard as it is to believe, of a Medicare co-payment on the poor to be used to pay the salaries of professional, middle-class medical researchers, with some dangling, over-blown promise of curing cancer or Alzheimer. And pigs might fly.

Then we had the doozy of the massively expensive PPL scheme for the well-heeled while the poor were to be screwed to balance the budget. This didn’t sell because voters on the whole have IQs higher than 90. Even now, after the Prime Minister’s speech to the Press Club, we are left with the promise of more money for child care when the budget needs repair and an expensive national disability scheme has to be funded. Consistent? You bet it isn’t.

It looks like Abbott will have difficulty surviving, as will the government in 2016. The Coalition might have got away with budgetary second-guessing after the election if it had put in place sensible saving measures and explained them carefully. It is difficult to do that without guidelines. A stringent budget needs be constructed within guidelines.

In my view a sensible guideline for a first budget, given a hostile Senate, would have been to do nothing which directly targeted those earning below a specified level of income — for singles, for couples and for couples with children. Middle-class welfare and departmental expenditure and staffing needed to bear the brunt of savings. This was obviously beyond the wit of Abbott, Hockey and Cormann.

Does Abbott deserve to go? Well, as William Munny puts it in the movie Unforgiven, “deserve’s got nothing to do with it”.

The budget was and is nothing short of a disaster. It has undone the reputation of a government that, within less than half its term, stopped the boats, got rid of the carbon and mining taxes, remedied the NBN, and entered into three important free-trade agreements. It may now be too late for Abbott to move Hockey and put Turnbull in his place. If it is too late, it is time for Abbott to go. If, on the other hand, he still has the authority to reshuffle the team he may have found the pathway to survival.

Don’t blame the voters for any of this. Don’t blame communication problems. Blame the budget.

 

Peter Smith, a frequent Quadrant Online contributor, is the author of Bad Economics

Comments [14]

  1. Just A View says:

    I remember reading somewhere that Peter Costello excelled at working his way through all the budgetary policy changes and sorting out obvious mess. Maybe this was just spin because the Howard Govt budgets were never perfect. Often policy changes were made without any reference to impacts in other areas. However the first Abbott budget didn’t seem to have the same rigour of the Howard years. So perhaps the quality of the ministers in charge really does matter. Some years ago Hockey mused about getting out of politics. I wonder how many of his colleagues hoped he would have acted positively on this thought bubble? All that said, the change to Aged Pensions indexation is entirely justifiable.

  2. Bill Martin says:

    Your your critique of the federal budget, Peter Smith, is spot on, but you are very wrong when absolving the voters of blame. Wasn’t it the voters who kicked out arguably the best government we ever had in 2007. Wasn’t it the voters who dismissed John Howard, a decent and competent Prime Minister in favour of the rabid socialist Maxine McCew, dancing in the street wearing a “Kevin 07″ tee-shirt? Wasn’t it the voters who returned Labour in 2010, albeit only with the help of some independent dupes? Regrettably, Peter, the average voter is not very bright, unable to comprehend complex policies or not prepared to make the effort to try, only marginally, if at all, interested in issues which do not directly effect hi/her and easily manipulated by spin doctors. Of course, the same goes for voters all over the world, hence the march of leftist ideology in so many countries.

    Bill Martin.

  3. Jody says:

    Agree with Bill Martin 100%. And this assessment of the situation according to Peter Smith, lacks nuance and balance. All political parties break promises but today the arena of politics is drastically changed. “Electronic graffit”, think tank policy formulation and government by opinion poll have put us on the road to ungovernability, Italian style. There are complex issues at hand here. The Medicare co-payment; $5 or $7 for people to pay (with a safety net for more frequent visits to the doctor) actually costs pensioners less than the cost of two cans of dog food. And they all own dogs!! It’s a case of priorities and this government has tried to take ‘lollies’ back from voters. Sorry, but I think the electorate in general is not very sharp and needs to grow up. Politicians are not perfect but most are in it for the right reasons. Hockey needs to carry the responsibility for the failed budget, as does the entitlement junkie electorate.

    Another thing to remember is that it’s not so long ago that governments had a MANDATE and did not have to micromanage and continually explain blow by blow to the voters what they were doing. Now that the ‘nanny state’ is a reality we expect ‘nanny’ to sit by our beds and tell us what is happening. This ‘nanny’ has turned into the big bad wolf and the voters don’t like it. I can remember the floating of the dollar, privatization of CBA, Qantas and our going to two wars in the Gulf. None of these had to have the agreement of the voters because the governments in question HAD A MANDATE.

    Welcome to the New World Order.

  4. [email protected] says:

    Some people say that Campbell Newman tried to do things too quickly. I disagree, I don’t want my grandkids to be saddled with debt before they have even started to work. Debt cannot be paid off too early. Debt is a society/civilisation killing cancer. Cancers may take years to grow before they are diagnosed/noticed or have harmful effects, but they must still be removed as quickly as possible after diagnosis and not left to slowly kill the patient.
    It needs to be stressed – loudly- everywhere- that the Greeks will never be able to VOTE themselves the prosperity of the average Australian, but Australians can [and just have here in Queensland] voted for themselves to have the poverty of the Greeks. The Queensland election has put us on the Greek ‘Freeway’. I think Campbell Newman in his own aggressive/abrasive way and Tony Abbott in his own timid way tried to steer us away from that road, but both have so far failed. If Shorten and his GREEN cohorts get their hands on the steering wheel of our economy we’ll reach the Greek destination much more quickly than if timid Tony is the driver.

  5. Peter says:

    Just a couple of points.

    (Just a view)- If we take the single aged pension of today of $20k and discount it back twenty years by average weekly earnings and then inflate it by the CPI it would now be somewhere between $14k and $15k. In my view that would be inadequate yet the same process taken forward twenty years will likely produce a comparable outcome. The question is whether as a society we are content to see pensions progressively fall against community standards. This all quite aside from the political damage of attacking a voting block more on your side than the other.

    (Bill and Jody)- I agree with the substance of what you say. Voters make bad choices at times. The nanny state has warped the body politic. However, this said, the budget in my view was indescribably bad. For example a co-payment is one thing; spending the proceeds on pie-in-the-sky medical research is another. Joe Hockey was asked to explain how those who would lose all unemployment benefits would live. He had no answer. It was an incredibly dumb performance. And the PPL was a constant pall on proceedings. How in the world could it be justified when the budget according to Hockey was in such terrible shape. The answer is that it couldn’t. Okay supposing we agree that voters are short-sighted and inclined to want free stuff. At least don’t make it easy for them by being entirely artless when breaking promises and bringing down a tough budget. My next door neighbour would have shown more finesse than Hockey. Peter

  6. Just A View says:

    Peter, wage inflation, as expressed by increases in average weekly wages, is almost certainly going to be higher than the official consumer inflation numbers. That average increase in wages effectively represents an increase in living standards available because of productivity increases etc as well as, hopefully, a larger economy. It’s worth noting that last year the RBA released a very good research paper showing that the published inflation rates typically overstate inflation for many consumers. You can read that paper to find out their arguments. The issue is, should the aged pension increase to effectively ensure pensioner’s living standards are maintained or increased. I would argue that living standard maintenance – or a slight increase if you accept the RBA research – is what the Government should be expected to payout. Unfortunately the Government has failed to make the case that our demographic structure is stuffed and going to get worse. They have failed to sell to age pensioners that they need to take one for the nation because without everyone making sacrifices the Government is financially stuffed in about 15+ years.

  7. Just A View says:

    Sorry, just a question before I potentially wear out my welcome – can anyone name a Federal, State or Territory ALP Government that hasn’t monumentally stuffed up Government finances?

  8. Jody says:

    Peter, points taken on your comments re the budget. I think Hockey is substantially out of his depth and I’ve always thought this. I’ve been a Liberal all my life – indeed, I was involved with my husband in the -election volunteering and celebrations the night of Fraser’s win. I simply do not remember him spelling everything out, point by point, dot by dot, to the electorate. They gave him a MANDATE.

    Now, on what you say about the Pension – I agree with this substantively. And unemployed youth having to wait ages for welfare; unreasonable. But can you see where the government is coming from? Wholesale abuse of the welfare system. I submit that it’s THESE people who are destroying it for the authentic folks who are needy. Much like the tax evaders who cause the Tax Department to treat the rest of us like criminals!! Something has to be done and fault or no fault, Labor is simply missing the DNA to do this. Scott Morrison will have a go and he will upset people because he’s not ‘caring and sharing’ (pass me the bucket please).

    So, I get back to the premise about the electorate needing to mature and accept personal responsibility, and the government making sure IT GETS IT RIGHT TOO. Maybe this is an ideal opportunity to recalibrate.

  9. Peter says:

    My overall point I suppose is that budget repair is necessary. But then you have to decide how to do it. And, in the end result, everything turns on that. It is one thing to identify a problem. It is quite another to decide how best to fix it. A lousy method was chosen, in my view. In my view again, great and mighty degrees of incompetence were applied. I don’t think this can be got around by saying that the problem had to be tackled. Or that all governments break promises. Or that voters are short-sighted and self-interested; however valid that is. None of that excuses rank incompetence; which plays right into the hands of those who will take us down the Greek road. Hockey and I have to say, reluctantly, Abbott have shown that they are not up to the budget job. I hope Abbott can redeem his position. I don’t think he can do that with Hockey as Treasurer. Peter

  10. Jody says:

    Glen Stevens has said today that a “surplus” won’t be possible in the foreseeable future. He was invited in to address Cabinet. I agree with the notion that the budget repair was ham-fisted and I say again, Hockey is not the man for the job. Abbott is increasingly awkward, hesitant and indecisive and his refusal to shaft Hockey may well be the sword upon which he himself falls.

    I just fear the alternative; a Labor government, where nobody has ever run a business or had to draw a profit = profligacy and kid in a candy store.

  11. Homer Sapien says:

    “The best argument against democracy is a 5 min comversation with the average voter” Churchill or Peter?

  12. Geoffrey Luck says:

    Queensland is again the litmus test for Australian politics. Peter asked the reasons for the debacle. Campbell Newman, an engineer and soldier, marched in determined to end the waste,inefficiency and cronyism. His first step was to deny the Palmer coal rail line – and look what that brought on – PUP! He managed to antagonise many sections of the electorate – all for very good reasons – but they added to a considerable voting bloc against the LNP government. There was also a lot of weakness in ministry and foolishness among the bank-benchers. The opposition woman did nothing, had no policies and stood back waiting for the government to destroy itself (not really believing it could fall so hard). But she wheeled in Shorten to make his 11 forays into the state, enabling him to amplify the chaotic mismanagement in Canberra. It proved the old adage that oppositions don’t win elections, governments lose them. So the Queensland lesson is likely to be repeated in the next federal election.

  13. hierophant says:

    A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship.