How ironic. In the opening days of the election campaign Anthony Albanese and Peter Dutton accused our major supermarkets of short-changing the public, yet they lead a political duopoly that is guilty of just this.
If you doubt this is the case, consider the policy platforms the Labor Party and the Coalition are offering voters. In many areas they’re barely distinguishable, reflecting an implicit bargain not to disrupt a political equilibrium with which they are both comfortable, but one that falls far short of the policy changes the country needs.
The major parties are running a unity ticket on significant fiscal, economic and environmental policy questions. They are both committed to net zero, which will continue to drive up power prices. Both support bracket creep. Neither is prepared to reduce our punishingly high top marginal income tax rates. Neither is prepared to touch the National Disability Insurance Scheme and other unsustainable entitlement programs.
Nor do the Prime Minister and the Opposition Leader appear to acknowledge the need for painful, politically difficult policy calls to be made in response to pressing economic and security challenges – although Dutton has indicated he will say more about our future defence needs.
In this campaign, productivity – the ultimate determinant of our living standards – is the economic concept that cannot be mentioned. Indeed, by demanding that the Fair Work Commission approve an “above-inflation wage increase” for the millions of employees on awards – and being silent on the need for higher productivity to pay for this – the Albanese government is calling for a new inflationary breakout.
Of course, like any self-respecting corporate duopolists, the major parties give the impression of real competition by talking up a small number of policy differences. Under the heading of cost-of-living support, we have Albanese’s $5 to $10 a week income tax cuts up against Dutton’s $14 a week fuel excise cut. Think Coke v Pepsi. To be fair, Dutton has committed to increase our gas supply and build seven nuclear reactors. This is no small deal. On nuclear, he has not blinked in the face of Labor’s appalling fear campaign and looked like a leader as a result. His refusal to demonise gas and coal – which a renewables-captured ALP cannot help demonising – is a breath of fresh air.
In contrast, Albanese’s campaign is based on two big lies: one, that wind and solar are the cheapest forms of energy (the cost of these is infinitely high for the 60 to 70 per cent of the time weather conditions do not favour them), and two, that Dutton plans to end Medicare.
To his credit, Dutton has been prepared to make a partial break with our political duopoly but seems hesitant to go the full way. This caution plays into the hands of Albanese. As we know, since World War II not a single first-term government has been defeated at the polls. Even Gough Whitlam was re-elected in 1974.
By refusing to offer a more compelling alternative to Albanese, Dutton is ignoring this political reality. He may be sending a subliminal message to the electorate – and I have in mind the 40 per cent of disengaged voters our electoral laws compel to turn up at the polls – that Albanese’s economic, fiscal and international policy settings are broadly acceptable. Dutton’s advisers could argue that oppositions offering ambitious policy manifestos inevitably fail.
But I am not calling for a 2025 version of Fightback. A single game-changing announcement can do the trick.
The only requirement is that it forces voters – and the media – to see our current political orthodoxy for what it is: a recipe for long-term national decline. Paul Keating’s much-maligned banana republic comment did just this.
At the risk of sounding like a broken record, a commitment to abolish bracket creep would serve this purpose beautifully. It should be backed up by data showing how much this “inflation tax” has taken out of household budgets since 2022 – which by some estimates is greater than the toll higher interest rates have taken – and the damage it will continue to do under a returned Labor government. With this commitment Dutton would be appealing to voters’ loss aversion, a more powerful psychological incentive than the future benefit of more gas supply offers.
It would put an end to Labor’s taunt that Dutton is not lowering taxes. Getting rid of bracket creep would not cost a great deal in the short term (although the cost rises across time), it would put an automatic check on the growth of spending and it would be a progressive, not regressive, change to our tax system.
As I have said before, let the election be fought as a referendum on this rather than Labor’s fictitious Medicare fear campaign. Better still, Dutton also should offer substantial personal income tax cuts, but I suspect the policy work simply has not been done.
A possible alternative to bracket creep reform, or an addition to it, would be to announce a substantial, specific and urgent increase in the defence budget in response to our rapidly deteriorating security environment. With the recent Chinese warship visit fresh in people’s minds, the electorate would be more than open to this. Again, such an announcement would put Labor in a difficult position, forcing it on to electoral ground it does not want to fight on – and exposing Labor’s instinctive anti-defence stance to full view.
No one can predict how election campaigns will unfold. Despite recent polling, Dutton could well win on the basis of his current agenda for change. Having worked on an election campaign long ago, I know how significant an ill-advised handshake, an unscripted comment to a voter or a costing black hole can prove to be in a tight contest.
Perhaps Dutton still may have a major policy card up his sleeve, as he has been hinting. His risk-averse advisers may be telling him not to play it, but for oppositions seeking to unseat first-term governments, playing it safe is risky in itself. In short, Dutton needs to do more to challenge the foundations of our political duopoly, just as he did with great success on the voice and nuclear power.
David Pearl is a former Treasury assistant secretary.
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