Labor has stopped caring about the working class
The Labor Party my family voted for is gone. Today’s party has turned its back on the aspirations of the people it once lifted out of poverty, writes Warren Mundine.
In the 2007 election barely a moment passed without a Labor politician uttering the phrase “working families”.
It was part of Rudd’s pitch to Howard’s battlers, aspirational working people who want to get ahead. For the 2019 election the phrase has been replaced by “fairness”. In Labor’s 2018 National Platform “fair” and its variants get more than 200 mentions. “Working families” gets none. It symbolises how far Labor has moved from its origins.
I came from Labor’s traditional base, raised in a working-class family in country NSW and western Sydney.
Everyone I knew lived in or just above poverty, were members of a union and voted Labor. The labour movement’s goal was to lift people like us out of poverty. Not with welfare but by answering our aspirations in education, jobs, income, home ownership and retirement.
We took advantage of the opportunities available to us, many of which were championed or enabled by the Labor Party and the unions, things like more accessible tertiary education, compulsory superannuation, maternity leave, negative gearing and the mining and property booms. Through these opportunities, we achieved better education, higher incomes and greater personal wealth. We became homeowners. Our children went on to university or into business.
Labor’s policies will hurt these people.
Labor will remove negative gearing on existing properties and increase capital gains tax. Three quarters of people who negative gear earn less than $80,000 a year. Many invest in property to get into the housing market and to help them buy their own home; others to build a nest egg for retirement. For many Australians their home is their only major asset and principal source of security for retirement. But with fewer investors house prices will fall, rental property availability will drop and rents will go up. How is this fair?
Labor will eliminate cash franking credit refunds. Franking credits prevent double taxation. Refunds are paid when the company’s tax rate is higher than the shareholder’s tax rate. Without a refund, the shareholder would effectively pay more tax than they should have. Removing franking credit refunds will hurt retirees who’ve saved and budgeted for their retirement. How is this fair?
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Labor will increase wind and solar energy to 50 per cent. Every system that has increased wind and solar has seen increased electricity prices and so will we. This will hurt low income people and retirees more than anyone else. How is this fair?
Labor will reduce emissions by 45 per cent, not possible without a massive reduction in industry and agriculture. Activities will go offshore and jobs and business opportunities with them. This will hurt working people and the regions. How is this fair?
These policies will hurt business and investment, kill jobs and make our economy weaker. And our regions will struggle even more than now.
Australia is a wealthy country. Even Australia’s poorest people have a higher standard of living than most of the world. We’re wealthy because our political and economic systems allow people to aspire and prosper, to start businesses and create jobs. It’s much better that all Australians have a high standard of living — even if some do better than others — than for us all to be equally poor.
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When Labor says “fair” what it really means is “the same”. It’s not “fair” that rich people get free education and health care but Labor doesn’t want to means test Medicare and public schools. Labor’s “fairness” is actually a mindset that no one should get more than anyone else and government will punish them if they do.
Labor used to be the party for working class people like my family who wanted to do better and see their kids do better still. The Hawke/Keating governments understood our aspirations. They also understood that economic strength is needed to support universal public services and that strong industries and the private sector are what create jobs. They brought in economic reforms and lowered personal and company tax. Howard’s battlers were actually from Labor’s traditional base. Now Labor is going to an election promising to punish the very people who got ahead under policies it once championed.
Current polling suggests Labor is on track to win the next election, not because of its policies but because the Coalition has been racked with division since the moment it came into office. This isn’t going to be a normal election where change is driven by a desire for a new direction for the country. But we’ll end up getting a new direction and it will punish working families.
Nyunggai Warren Mundine AO is author of Warren Mundine — in Black and White and chairman and managing director of Nyungga Black Group
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