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Day to Day Politics: That’s a super idea.

Sunday 21 August 2016

1 One of the first acts of the Federal Government when parliament resumes will be to actually cut unemployment benefits. By removing the ‘clean energy supplement’ to all new welfare beneficiaries – resulting in an $8.80 reduction per fortnight for singles and $7.90 for couples – it will in effect drag their income to 32% below the poverty line.

This is remarkable given that the Business Council of Australia has long argued for an increase in the dole. According to economists this will increase the gap between the haves and the have-nots.

The 10 richest Australians already own as much as the bottom 4 million combined.

At the same time it is looking more and more likely that the government will do a backflip on the Superannuation policy it took to the election. Reports suggest that Treasurer Scott Morrison is considering options such as lifting the proposed cap from $A500,000 to $A750,000 or leaving it unchanged but not backdating it to 2007.

Shadow Treasurer Chris Bowen said of the proposed changes that it must be “humiliating” for the Treasurer to make the changes in an effort to calm the Liberal backbench.

So whatever he chooses he will have to keep the Coalition backbench happy and it will be at a great economic cost to the nation. Of course as he always says, savings will have to be gotten elsewhere. Look out!

Remember that within a couple of years taxation discounts on superannuation to high earners will cost the taxpayer as much as the pension.

So we are running two parallel schemes. One for the poor and one for the well off. The odd thing is that the taxpayer funds both.

Richard Dennis of the Australia Institute sums it up:

“Each year taxpayers contribute $27 billion to the so-called ‘self-funded retirement’ system. More than one-third of that $27 billion goes to the highest 5% of income earners. According to the super industry it takes more than $50,000 per year, tax-free, for retirees who own their own homes to retire ‘with dignity’, which is nice. But why are we spending tens of billions per year to help a minority retire in dignity when we are happy with the disabled, carers and those who are already retired without super to live on less than $20,000 per year”.

An observation.

“Never in the history of this nation have the rich and the privileged been so openly brazen”.

Meanwhile, according to the Roy Morgan daily summary Chris Richardson of Deloitte Access Economics has warned that the Federal Budget may remain in deficit for some time. The Treasury has forecast that net debt will peak at $A356bn before falling to around $A335bn in 2021-22. However, Richardson’s analysis suggests that net debt could rise to $A440bn by 2021-22 if the nation records nominal GDP growth of 3.5 per cent and the Senate continues to reject the Government’s proposed spending cuts. May 2016 Budget forecasts are based on nominal GDP rising from 2.5 per cent in 2015-16 to five per cent by 2017.

Now the fact is that Treasury itself has said that the growth figures the Government has pinned its hopes on, and took to the election, are highly improbable.

“And the Opposition has signalled that it will not support all of the Federal Government’s proposed $A6bn worth of cost-saving measures, despite backing most of the reforms during the 2016 election campaign. A proposed $A1bn reduction in funding for the Australian Renewable Energy Agency in particular is likely to be opposed by the Australian Labor Party, which is also likely to vote down a plan to progressively reduce the corporate tax rate to 25 per cent. The Government plans to introduce a so-called “omnibus” bill containing 21 separate Budget-items”.

Given that the Senate cross bench individuals and the minor parties are likely to vote against a lot of the measures, how much will actually get through?

But of course the Prime Minister is calling for a bi-partisan approach to the problem. He expects, for the sake of the nation for Labor to surrender its principles and jump on board the “jobs n growth” express. They won’t. Well only to the degree that they can say they have helped. Thereafter they will give as much as they got under Gillard.

Presenting a single bill is not the way to go about it. Locking 21 separate initiatives aimed at reducing spending by $6.49 billion into one single bill is more like a declaration of war.

So who is kidding who? It’s a dog’s breakfast. The budget has collapsed before a brick has been laid.

2 In a Donald Trump campaign that is going from bad to worse, or insult to insult, we now find that his campaign chairman Paul Manafort has resigned. Something to do with his connections to Russia. I had better stop there before I become part of the circus.

My thought for the day

“How is it possible for the inherited rich and privileged to understand poverty?”



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  1. Möbius Ecko

    No surprise it looks likes the same sex marriage plebiscite is going to be delayed until next year. A broken election promise that it will be held by the end of this year.

    This comes on the top of the clusterfluck the L-NP has made of recognising indigenous Australians in the constitution.


    There is so very little the L-NP have done well in government and so much they have utterly screwed up. There is no other way of putting it.

  2. stephentardrew

    Makes me so mad John. People in this country really are a bunch of thoughtless sheep sucking up racism, unjust wars, gross injustice and inequality; torture; impoverishment of the low income, unemployed, disabled, aged pensioners etc. while loosing wage parity as the rich get richer and the public feed the monster that is conservatism.

    It is all mirrors and lies.

    Modern money theories demonstrate how completely people have been conned by the debt myth and the necessity to have unemployment. It’s all good to let the marginalised suffer simply to generate more and more wealth off-shored to illegal accounts, they are not tax havens because tax is a deflection, they are wealth accumulation schemes. See how language so completely befuddles peoples minds. They don’t avoid tax they just don’t pay it with the full blessing of governments right and left.

    Then they buy back their own share at inflated prices while executives cream off the profits with absurd bonuses while investing in the financial gambling game using exotic tools like derivatives etc. This is without going into the complete and utter con of Quantitative Easing and monetary policy which is driving interest rates to near zero pretending that somehow it will magically stimulate growth. Meanwhile unemployment increase as full time jobs disappear and part time jobs are on the increase.

    Things are getting worse and worse for the ordinary person yet they live in some kind of magic land in which being ripped off is going to make things better. I feel sick.

  3. wam

    we are rich and the fear is we will be poor under labor.
    If things were getting worse for the ordinary voter they would have dropped the libs for what?? Worse debt? Labor still has not settled the lie about the debt crisis and yet they were close. This, despite giving the red necks another free run about gillard’s billions of debt on our grandchildren and hate of muslim men running away. Why no counter slogan?
    it seems clear that most of the poor are happy if there are people worse off and ‘I’m alright jack’ rules. QED.

    ps how can indoctrinated private school buffoons believe anything good about public education?

  4. Owen

    John .. the rich can not truely understand poverty… The poor will never be represented fairly in Parliament as they are seen as failures … victoms of circumstances ..The poor are looked at by the rich as citizens that cant even manage their own lives..So how could they manage a country… So I wonder too how many tradies have made the switch to political office labourers and the like .. Not too many I suggest……. Donors ( the rich) seem to be able to endorse candidates with their own like agenda and promote them with wads of cash.. This can never be matched by the lower classes, their opinions ,inputs, ideas or contributions no matter how great or sensible will never be heard by the majority…Money makes the world go around but not if you are poor..

  5. Terry2

    As Mobius notes, the Abbott plebiscite on marriage equality has now become the Turnbull plebiscite and whilst Turnbull was initially opposed to a plebiscite, he now embraces it probably because labor oppose it.

    The problem for Turnbull is that he is now going to push it back to 2017 which will clash with the scheduled referendum on Constitutional change on aboriginal recognition : it should be remembered that it was in November 2012, that the Parliament set up a Joint Select Committee on Constitutional Recognition of Aboriginal and Torres Strait Islanders. So this consultation process has been going on for close to four years with no conclusions and no proposals so far .

    Turnbull originally said that he wanted a referendum in May 2017, the 50th anniversary of the successful 1967 referendum that gave the Commonwealth power to make laws in respect of Indigenous people. Now it seems that this objective will be put aside in favour of a marriage equality plebiscite – Turnbull would presumably balk at the idea of combining the two into one national vote.

    It seems to me that this government is just flip-flopping from one disaster to another and I wouldn’t be surprised to see him going to another Double Dissolution before he’s finally rolled by the Abbott faction.

  6. Harquebus

    Politicians and economists, along with most commentators, have no idea about what powers modern economies. It is cheap and abundant energy.

    “The more we rely on more expensive and lower quality energy to keep the economy moving, the slower the economy moves.”

    Wayne Swan is another know nothing; as are most economists.

  7. wam

    the non university member of party candidate selectors are more likely to select uni people when given the choice.

  8. Graeme

    Clean Energy Supplement ($8.80 – $7.90)…in Joe HOCKEY’s terms “the price of a middy” OR for those already in poverty, a day or mores electricity.

  9. jim

    Hey I just dropped off me mining buddy off and he tells me he has taken a $6 per hour pay cut in just the last six months ,I’d like to know just how wide spread this pay cutting is.
    The way this fn Liberal government fudges figures I feel a recession heading our way …Hmm better change the insulting laws. that’ll fix it.

    We have the worst government . since 1949 and it’s the LNP,……As the Australia Institute’s research in June found – across a broad range of economic measures, the Abbott/Turnbull government has performed the worst of any Australian government since 1949. Economist Jim Stanford’s report examines economic performance across 12 indicators – including GDP per capita, the unemployment rate, employment growth and the growth of real business investment and intellectual property investment …

  10. Jaquix

    If I were the Opposition I wouldnt be passing this “omnibus” “package” – the fact that they took them into their own calculations at the 11th hour is a matter for them. They would have been spending the “savings” in an entirely different way to that which the Libs intend to do. As Bill Shorten said “MT is negotiating by megaphone”. Absolutely unbelievable that Turnbull and Morrison are bleating about cooperation, at the same time as threatening and intimidating the Labor Party, which has no obligation whatsoever to support any of their crappy legislation. Which apparently they havent had the good manners to hand over. Seven weeks in government, and absolutely nothing but mayhem, backflipping (on superannuation, and plebescite timing) And what about the ABCC? I thought that was to be the first order of business? On the “Omnibus” thing – the sight on “Insiders” today of Michaelia Cash taunting Bill Shorten to “Be a Man etc etc” ,and Kelly O’Dwyer rabbiting on about “Labor honouring their commitment” was just sickening. The Liberals might have a few more women in their ministry but they are horrible, vacuous, nasty spin merchants.

  11. Carol Taylor

    Mobius @7.24am. I was absolutely appalled to learn that the question on any Same Sex Marriage Plebiscite might be that we, you and I, and our friends and families get to decide whether or not we PERMIT people to marry. I will repeat..PERMIT. Sorry, but I do not believe that any of our gay friends or family need MY PERMISSION to marry and I am appalled to think that they would need it. Permit someone to have the same rights as the rest of Australia…..how grand of us that we *might* grant permission.

  12. paulwalter

    In the end, another article pointing out how the conservatives will not desist with bad policy even virtually at gunpoint. They are constitutionally unable to admit even obvious errors.

  13. Kronomex

    I won’t be in the least little bit surprised if the plebiscite gets pushed back further into 2017. Turnbull’s leash holders will find some reason to delay it. Tax? Tax is for little people to pay to help prop up the 10%.

  14. Carol Taylor

    An interesting article by former Justice Kirby today describing how the plebiscite sets a dangerous precedent, that Australian governments are elected to govern and if plebiscites became the norm for Australia, it would mean that every time a government had to make a hard decision, that they would simply flip it over to a time-consuming and expensive plebiscite.


  15. helvityni

    Anything bad happening in Oz politics is always ‘Labor’s fault’ according to the Coalition.

    Also ONLY Labor needs to keep its promises, the Coalition conveniently FORGETS theirs or moves them into the ‘sometime in the future’ category, when hopefully NOBODY remembers them…

    It’s different strokes for different folks.

  16. Harquebus

    Carol Taylor.
    If the major party politicians truly represented their constituents, I would agree with you but, they don’t so, in my opinion, plebiscites are good idea. Most politicians feel that since they were elected, it is their right to implement their will and not ours.
    Which politician polls their electorate and votes accordingly?

    I think Justice Kirby is just worried that the marriage equality proposal will fail.

  17. Möbius Ecko

    Absolutely Carol, it should not be up to the people of Australia to decide whether they can marry, but just the individuals concerned.

    It should only be an act of parliament based on law, and it only needs to be that because a past homophobe PM changed the wording of the legislation to exclude a group, and that now needs to be amended to include everyone.

  18. Möbius Ecko

    Kronomex already happening. The muted February date clashes with the WA election so both the WA State L-NP and ALP want the plebiscite moved right.

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