PM fails to inspire while Shorten goes for overkill

Scott Morrison and Bill Shorten shake hands before the Perth debate. Picture: Nic Ellis

The two extraordinary features of this campaign were on display in the first leaders debate — Scott Morrison’s skill in dressing up the Coalition’s poor record of instability, and Bill Shorten’s overkill in pushing flawed policies he doesn’t need to win the election.

Morrison has restored plausibility and coherence to the government after the leadership chaos of last August. Even getting back to a 51-49 per cent deficit is a remarkable feat. In effect, he says to the public: don’t shut your eyes, take another look at us.

But Morrison’s critical problem is defending the status quo when people are dissatisfied with that status quo. This is Morrison’s ­ultimate trap in the election. The government’s stance is too static, too limited, too tied to a “strong economy” message devoid of fresh ­momentum.

Of course, the Prime Minister’s economic pitch makes policy sense. He puts the nation on notice with his warning: “Now is not the time to turn back.”

His plan is to keep things going, keep the wheels turning, keep ­creating 1.25 million jobs, keep unemployment low at 5 per cent and the budget back in surplus, keep growing the economy. He runs a deeply conventional Liberal campaign — “trust us” for a strong economy when Labor means a weak economy.

Yet many people are reluctant to listen. They are fed up with years of Coalition division. They are sceptical about claims of economic success when their living standards are being compressed. Morrison’s problem is the zeitgeist lies elsewhere — in emotional ­resentments, household pressures, “hard done by” grudges, disillusionment with the system and a sense of unfairness at a power structure assumed to be rigged against ordinary people.

Morrison is fighting a lot of battles in this campaign — against Shorten, against five years of government instability, against struggling living standards and against the zeitgeist. The ScoMo persona is gaining traction. Morrison is a smarter and better leader than many people assumed when he took over last August.

His task has been restoration, stabilisation and recovery. That means Morrison is not running a change agenda. He offers no new vision, no new policy philosophy. When it comes to positives, Morrison’s message is the government has delivered more than people ­realise, its record is better than the polls suggest and that he runs a pragmatic government that believes in the economic troika of services, tax cuts and surpluses.

But this is a tough sell at the third election. The limits in Morrison’s position were revealed at the end of the debate. He summarised the choice: “Higher taxes or lower taxes, stronger management of ­finances or weaker management; a strong economy or a weak ­economy.” It is a perfect summary but it is far too narrow. Where is the agenda for the future?

After 27 years of growth, economic management lacks the electoral pull it once exerted. Morrison’s pitch is too instrumental. Where is the hope? Where is the inspiration? Where is the emotion or the connection with the public?

Ultimately, the Morrison campaign returns to the negative: don’t trust Shorten’s change agenda, and ask yourself: what is the cost?

“Mr Shorten is still not answering these fundamental questions,” Morrison said. He had a long, ­lethal, list. What is the cost of the Opposition Leader’s emissions reduction policies? Where will Shorten’s tax bill finish? How many industries will have wages topped up by the taxpayer?

How many people will be hurt by the retirees tax?

Yet Shorten’s ability to surf the momentum for change is on daily display. The debate revealed Shorten plugging into the public’s emotions, exploiting the sentiment that things should be better, channelling grievance and repudiating Morrison’s warning about the cost of change.

Shorten didn’t speak in policy vernacular. He spoke in research-proven emotive bites. Australia was best when we “invest in people”. He would put the middle class and the working class “back on top”. On climate change, people just “want us to get on with it”. If the government was “fair dinkum” on climate change “then Malcolm Turnbull would still be prime minister”, and without “real action” it will be “a disaster for the economy”.

“The economy is not working in the interests of working people,” Shorten said.

He wanted Australia to have the “world’s best” health and education systems, and Labor could ­finance this because it had taken the hard decisions (brave Labor). Instead of tax loopholes for the “big end of town”, it would prioritise childcare, pensioners’ dental health and schools (compassionate Labor). None of these changes could happen without ditching the Liberal government.

“They’ve been in charge for six years and life hasn’t got better for a lot of people,” Shorten said. He moved to his pivotal point in this continuity/change contest: “You know, Mr Morrison says there is a cost to change … I’ll tell you what … the cost of not changing is more” — people not being able to deal with cancer, handing a worse environment to the kids, keeping tax breaks for the wealthy instead of looking after schools, hospitals and childcare.

Here is the overarching point — Shorten wants a “change versus status quo” election. He believes if this is the contest, it means a Labor victory. Despite his repeated blunders in the opening fortnight, Shorten is not rattled. He stays on strategy. The debate proved that and showed Shorten, drawing on his experience, keeping his composure. It proved Shorten in making the case for change has an easier brief than Morrison.

Yet the debate and opening fortnight raises a bigger question: why is Shorten rolling out so many flawed policies that will risk the economy, raise expectations that cannot be met and create profound problems for Labor in office, if he wins?

This is surely the great conundrum of the election.

Shorten seems to be cavalier about risks. He won’t provide estimates of the cost of his climate change policies. He just assumes the voters will accept it — of course, he may be right. But this sounds like arrogance.

He announces a childcare policy but ties it to taxpayers topping up the wages of childcare workers — to deliver a pay rise of 20 per cent at a cost of nearly $10 billion over the decade.

On what basis does Shorten ­decide some workers will have their wages boosted by taxpayer funds and other won’t? Childcare workers deserve a pay rise. So do workers in other industries, from aged care to disability care. On what basis are they denied? What is the justification?

Shorten acts in the name of fairness but creates new problems of unfairness. This is the perpetual dilemma when politicians do special deals and special fixes.

Shorten’s pledge to make this an election on wages will haunt him in office if he wins — it is one deal after another, overruling the Fair Work Commission when the union pressure gets too great, pretending governments can deliver sustained higher wages by pressure, law or fiat. Shorten began by running a tax/spend agenda but his policies are starting to resemble a collection of one-off vote-buying fixes.

As Deloitte Access Economics guru Chris Richardson recently said: there is no magic pudding, no easy option for an economy where the growth of the economic pie is slowing — yet Shorten is telling most people they are going to be better off. Governments cannot legislate an enduring increase in living standards. They cannot deliver a fairer society without strong or adequate economic growth. Tax redistribution by itself is not a path to a more harmonious or fairer society.

Ultimately, living standards will depend on productivity, participation and worthwhile investment. But Shorten has said virtually nothing about a Labor growth strategy for Australia. The entire Labor campaign is about redistribution and compassion.

Shorten had the courage to take tough decisions on tax increases — but the longer his campaign runs the more it looks like tactical appeasement of one group after another. Shorten looks like an ­opposition leader making too many bad policy pledges that he doesn’t need to make and, in the process, is storing up a bundle of woes for himself if he wins.