It’s the economy, front and centre

Messy and tawdry as the last fortnight of parliament for the year has been for the Morrison government, the upheavals created more excitement inside the Canberra bubble than in the battleground seats where the coming election will be decided. Jobs and economic opportunities are more interesting to most voters than wrangles over MPs crossing the floor. Labor’s climate change policy, announced on Friday, will be part of the race. Power bills are always a potent issue and, increasingly, so is climate change in some electorates. But more than ever in the wake of the pandemic, the adage coined by Bill Clinton’s strategist, James Carville, 20 years ago, “It’s the economy, stupid”, will be front and centre.

As Paul Kelly writes in Inquirer, the economy is the only game in town for the Coalition. Scott Morrison and Josh Frydenberg will be depending on the fact that if jobs and economic opportunities are increasing, and taxes are coming down, such conditions should help avoid the kind of groundswell momentum for change that brought Labor opposition leaders Gough Whitlam, Bob Hawke and Kevin Rudd to office. This week, the Australian Bureau of Statistics reported that gross domestic product contracted by 1.9 per cent during the September quarter because of Delta lockdowns. On the same day, the OECD predicted the Australian economy would grow by a healthy 4.1 per cent next year.

Provided the states hold their nerve in the face of Omicron and any other new Covid-19 variants and avoid further lockdowns, unemployment, which was 5.2 per cent in October, should fall over the summer as the economy opens up. The strong demand from business for skilled migrants points to an economy that is beginning to roar, creating opportunities for profits, growth and an increase in tax revenue. While jobs are secure, productivity, wages and workplace relations should be an important election battleground. As Kelly writes, that issue was captured in the Business Council of Australia’s report, Living on Borrowed Time: “It now takes an average worker seven years to increase their pay by $100 a fortnight – in the past workers were getting that size pay rise every year or two. It’s why people don’t feel they are getting ahead.”

The Treasurer says the budget is already moving away from a crisis setting, with details to be revealed when the mid-year economic and fiscal outlook is ­released on December 16. Across the medium to longer term, budget repair is vital for all countries after the necessary economic support that plunged budgets deep into the red during the pandemic, as the OECD report made clear.

The need for budget recovery leaves little room for reckless election promises by either major party. Ahead of a tight race, the opposition increasingly has been referring to the “decades-old government”. Some in the opposition ranks and some commentators are attempting to cultivate an “it’s time” factor, based on the idea that the Coalition is fatigued and out of energy and ideas after serving since Tony Abbott’s election in 2013.

The reality is different. As Olivia Caisley and Richard Ferguson write on Saturday, the election will pit a still relatively new-generation Coalition frontbench against a Labor team still dominated by Rudd-Gillard veterans. Depending on voters’ memories of those years, that may or may not be an asset. Anthony Albanese, who served six Labor leaders from Kim Beazley to Bill Shorten before winning the top job after the 2019 election, is seeking to make his frontbench’s experience an asset.

An Albanese government would be the most experienced incoming Labor government in Australia’s history. Political strategist Bruce Hawker is right when he says the Opposition Leader, who has a ministerial and shadow ministerial record stretching across 23 years, should play up his own skills and experience across portfolios such as housing, infrastructure, energy and regional development. Doing so would reassure voters he had the experience to be prime minister, Mr Hawker says.

While the Coalition has been in government for nine years, many of the leading figures when it came to power in 2013 are gone. Most of the cabinet took office in the ­Abbott era and the early days of the Turnbull government. Health Minister Greg Hunt’s retirement from a critical portfolio is a loss. Another 10 Coalition MPs are also retiring. But the government has promising backbenchers, such as Victorian MP Katie Allen and West Australian MP Celia Hammond. It has scope, if it wins, to renew its ranks. Voters can expect little respite from campaigning between now and May. Apart from their perceptions of the main parties’ economic expertise, an area that traditionally has favoured the Coalition, management of the pandemic and vaccines will also loom large.