Scott Morrison must fix car before getting it back on road
Scott Morrison’s task is big enough without an ongoing battle with stubborn state leaders
Scott Morrison is going to have to shoulder the burden for delivering Australia’s vital economic recovery from the worst recession since the Great Depression or beyond.
Suppressing coronavirus infections, building an economic recovery and reining in generational national debt and budget deficits comprise the toughest challenge facing any prime minister since World War II.
Morrison’s challenges are manifest and multiple: a fracturing federation; parochial, politicking premiers; consumer fear and anxiety; disrupted supply lines; internal travel restrictions; business uncertainty; more than a million unemployed; labour laws no longer fit for purpose; moving towards $1 trillion in national debt; endless budget deficits; the pandemic’s exposure of policy failures, such as aged care; and promises on superannuation and services contradicting the need for spending restraint.
The pandemic has also exposed the shallow talent pool in the ministry and created friction within the cabinet about Morrison’s refusal to attack failed and recalcitrant premiers.
The departure of the respected, tough-minded and disciplined Mathias Cormann as Finance Minister and the need to replace him with an experienced cabinet minister is the paramount personnel decision Morrison has to make.
In light of speculation that he will simply promote Trade Minister Simon Birmingham to Finance and Senate leader to replace Cormann, and move his hardest man, Peter Dutton, to Defence, Morrison should think of switching and putting the unflinching Home Affairs Minister as the cop on the financial beat.
If Morrison can continue to eke out federal-state co-operation and compromise, taper the job-support spending, start on the “bumpy road” to recovery, fight Labor’s political campaigns on aged care and superannuation, reshuffle his ministerial team and revive business and household confidence, he has a good chance of winning another election.
Any victory will be by way of building on the relative success of the way into the pandemic recession with a successful start on the way out.
The fatal health and dire social impact of the COVID-19 pandemic are not worse than the Spanish flu or the Depression because we are not the same society, but the cost of preventing mass deaths and life-destroying unemployment to meet modern values and expectations has created a greater economic disaster.
Whatever mistakes have been made in fighting COVID simultaneously with a global recession, Australia is still among world leaders on health and economic outcomes.
As Morrison conceded to the Labor opposition this week, such achievements are “cold comfort” to the families who have lost relatives and the people who have lost their jobs.
But, as Australia went into recession for the first time in almost 30 years, the blame and political fallout have fallen on the COVID-19 pandemic.
Anthony Albanese and his Treasury spokesman, Jim Chalmers, made no attempt to blame Morrison and Treasurer Josh Frydenberg for the recession itself, but immediately moved their focus to the economic recovery, its planning, speed and ability to create jobs.
On Friday, Chalmers summarised Labor’s position thus: “Certainly, the magnitude of this health crisis has meant that there was always going to be pretty devastating impacts on the economy. We’ve acknowledged that throughout.
“The job for government, particularly the federal government, is to do what they can to make sure that the recession isn’t any deeper than it needs to be and the unemployment queues aren’t any longer than they need to be.”
Morrison and Frydenberg were thankful for the “Australian people recognising the reason for the recession”, and immediately talked optimistically of a “road out” and 2021 being a “better year than 2020”. But they were immediately confronted by premiers defying the commonwealth plan to replace blanket border bans between states with selective limits placed on infection hotspots.
Friday’s national cabinet meeting was a compromise that saved face, even including Queensland in “talks” aimed at easing restrictions by Christmas. After six months of unprecedented national leadership co-operation, Morrison and the commonwealth have been left in the lurch by parochial, incompetent and populist premiers.
Led by Annastacia Palaszczuk’s election campaign theme of Queensland for Queenslanders, Mark McGowan’s tapping into Western Australia’s secessionist history and Daniel Andrews’s Victorian legacy of Australia’s worst COVID-19 outbreak, the informal unity of the fledgling national cabinet – established through consensus of the federal, state and territory leaders – is broken.
As Morrison tells Inquirer, he is continuing to resist urgings, temptations or invitations to fight premiers, particularly the border champions, Palaszczuk and McGowan, and the quarantine failure of Andrews.
“I will continue to exercise patience, I will continue to recognise the states are all coming from different situations. They may not all come together at first or at once, but it is important we provide the way forward so they can all join up. Sometimes you have to rebuild things one brick at a time,” he says.
“I’ve put a peg in the ground with the hotspots plan and I think its scientific and practical merits will eventually be accepted in its current or modified form, when the politics fade and we can get Australia back on track.”
The first challenge is the commonwealth plan to taper the spending on job support through JobSeeker and JobKeeper. Albanese has conceded the payments have to be reduced but can opportunistically brand the Coalition as making it hard for families “to feed their children” and adding to the unemployment queues.
Morrison accuses Labor of having another “each-way bet” by supporting JobSeeker, recognising it needs to be reduced over time, but criticising the Coalition for doing so.
In parliament Morrison is claiming a superior economic record over Labor and declaring Albanese “can’t be trusted” at a time of economic crisis because he didn’t recognise the seriousness of the pandemic in February, makes each-way bets on policy and wants to maintain endless public support.
It is here that Dutton’s experience – he is the last vestige of the Howard government ministry – and tough attitude could be best used in the less glamorous and low-profile insider’s job of controlling government expenditure. Morrison can’t credibly promise continued services, sound economic management and unprecedented job support without being able to prove strict controls on government expenditure.
In previous governments at times of economic challenge and reform there have been hard finance ministers supporting treasurers – Labor’s legendary Peter Walsh helping Paul Keating and Liberal Nick Minchin working with Peter Costello.
Cormann has been a hidden stabiliser for three treasurers and getting out of the worst recession in a century with necessary and lasting reforms is going to mean replacing him with more than an affable demeanour and a conventional promotion.
Morrison will have to shoulder the burden and responsibility of recovery, but that doesn’t mean, and shouldn’t mean, he does it on his own.
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