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The Tag Line

By 2353NM

The recent election was an exercise in marketing and not much else. Morrison promoted himself and ‘good economic management’ rather than the Coalition while flitting around the country handing out dollars to ‘deserving’ infrastructure projects, usually in marginal seats.

Shorten’s ALP had, by contrast, released a stack of policy over the last few years outlining changes they would make to make Australia a ‘fairer place’ for all. The policies and detail were so devilish, it even tripped Shorten up a couple of times.

Morrison’s claim for good economic management was his claim to have returned (past tense) the budget to surplus next year (future tense) — regardless of the tortured grammar evident in that statement — tax cuts for most wage earners over the next decade as outlined in the budget published in April and really, not much else. Compared to Shorten, Morrison didn’t have much to sell except his budget, himself and hope that the instability of the last six years would be forgotten. We published ‘The Cupboard was Bare’ just prior to the election which suggested that there really wasn’t much policy development work going on in the Liberal and National Parties, probably because they were too busy pulling the knives out of each other and cleaning up the blood on the floor, hoping that no one would notice.

At the end of the day, it doesn’t matter how the Coalition seemed to come from behind and win on 18 May, the fact is they did. It could be, as Morrison has sort of claimed, a miracle. Brian Schmidt, Vice-Chancellor of Australian National University and a Nobel Laurate wrote an article in The Guardian on the Monday after the election suggesting the polls suffered from a confirmation biaswhich if true, clearly wouldn’t help those relying on the ‘accuracy’ of the polls. Shorten also had a harder ‘sell’ than Morrison, in that he had to appease winners and losers while promoting a fairer society in a world where extrinsic motivation seems to be a real issue.

Marketing slogans can be used for a variety of purposes. They can be negative, such as Abbott’s ‘carbon tax’ lie, unable to be proven such as ‘good economic management’, or even patriotic such as ‘football, meat pies, kangaroos and Holden cars’ (even though the original version of that last one actually name checked apple pies and Chevrolets).

The point here is that Morrison and his party learnt the lesson Abbott and other politicians had passed down. Relentless repeating of a particular phrase will lodge it into people’s minds. The facts around the conversation don’t matter if the phrase is repeated often enough. Sure the ALP had a generally positive message throughout the election campaign in comparison to the Coalition’s negativity, but people remember and gradually believe the slogan rather than the nuanced discussion — demonstrating why advertising works.

And the ‘sell job’ for the Coalition’s next three years has already started — returned WA Liberal MP Christian Porter was on ABC’s Midday News on the Monday after the election claiming that Morrison had a resounding victory? Morrison didn’t have anything of the sort. The reality is that the Coalition just fell over the line in the House of Representatives and has to negotiate to get anything through the Senate, just as Turnbull did three years ago. Howard had a resounding victory in his last term as he had a majority in both houses. Howard then overstepped the mark by introducing Workchoices leading to his government being removed and Howard losing his seat in Parliament. However, just as repetitively claiming Holden cars are entirely Australian (when they never were) is gradually taken as a self-evident truth, Morrison’s slogans and ‘resounding victory’ are being used to gradually shape the ‘truth’ to something more palatable for the government.

After Morrison legislates his budget, his policy cupboard is bare. While Morrison will also be seen as the messiah within the Coalition for the next six to twelve months, after that the same factions and self-interest groups that infected the Abbott/Turnbull/Morrison governments from 2013 will reappear, attempting to inject their pet proposals into the discussion claiming they have a ‘mandate’, because they believe their own advertising. Should the ‘mandate’ not be recognised, the self-interest groups will withdraw support leaving Morrison in a similar position to that he was in in the closing days of 2018. Morrison may also be tempted to pinch policy from the ALP or Greens and roll it out. Either way, Morrison could have a problem.

A smart Opposition Leader can sell two messages at once — even Abbott made a reasonable fist of it. Every time Morrison introduces legislation that was not specifically part of his policy at the 2019 election, the Opposition Leader should be asking, “where is the mandate?” If the policy is pinched, the Opposition needs to remind us where that policy is originally from and that while they are happy to see that Morrison can see the benefits, ask why the LNP couldn’t develop such a sensible concept without help? At the same time, the Opposition Leader should be using a tag line to suggest that they could do it better. If the economy goes south (which seems to be the general expectation), the question should be why couldn’t ‘good economic managers’ see this coming and make preparations in a similar way to Rudd in 2008.

Positive policy development is required but they need to sell it as well. Lots of good ideas never succeed because those involved in the idea seem to think the truth is self-evident — it isn’t. Why didn’t the ALP have a clear and consistent marketing program that started the day after Abbott looked on the ropes, which they might have capitalised on when Turnbull’s had his near-death experience at the 2016 election? Because they didn’t, only the rusted-on took the time to appreciate the nuanced discussion on policy fairness that Shorten tried to sell. It really doesn’t work when the other side just kept on saying they had ‘good economic management’ and ‘it wasn’t time’. A tag line can be positive or patriotic, like the Holden slogan from the 70’s. Maybe the ALP should have tried to sell a ‘fair-go plan’ that covered all their policies. It’s a sad reflection that the political party that launched tag lines in Australia has been beaten twice in the past decade because others remembered the importance of a tag line and consistent messaging better than the originator of the concept.

This article was originally published on The Political Sword

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21 comments

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  1. Terence Mills

    The problem for our democracy, as I’ve outlined elsewhere, is that a political party will be very reluctant to go to an election in the future with well calibrated and costed reform policies having seen the way Labor were castigated and misrepresented over negative gearing and franking credits.

    As Bob Hawke observed to John Hewson after he lost the unloseable election in 1993 ‘mate, it would have been better to keep the GST in your bottom draw until after the election.

    In the same way, Labor need in the future to foreshadow a root and branch enquiry into our taxation system to unearth and expose the anomalies and rorts within and then enact the results of that enquiry.

  2. Kurt Liffman

    Good article. Point taken. However, in my discussions in the seat of Chisholm, it was almost certainly the issue of Franking Credits that tipped the balance towards the Liberals. Anyone 60+ in age that were affected by the removal of Franking Credits and anyone 58+ that was looking forward to latching on to the Franking Credits tax rebate were not going to vote Labor.

    In addition, you had the children and grandchildren who were faced with the prospect of putting their hands in their own pockets to help support their parents/grandparents. This is a significant network of people. I talked to many such people and they were distressed, angry. They felt that they had followed the law, provided for their own retirement income and worked hard for their benefits and they didn’t care about any other issue. The World could burn, they wanted their franking credits.

    I don’t think Labor will make the same mistake again. It was a remarkably stupid policy in the political sense. It should have been at least grandfathered to reduce the bad political effects.

  3. Kaye Lee

    If you are relying on a franking credit refund, you are not providing for your own retirement income. You are getting a government handout that has become unsustainable. Anyone who is not eligible for a part pension has significant assets or income. The problem is those people do not want to use their own money to fund their retirement. They want to save that to give their kids. Meanwhile billions in company tax is being lost to the budget.

  4. wam

    What enjoyment your post gave me as I warmed up after 30mins in the pool.

    Albo has so many tasks to recover the labor name, the labor principles and the labor uniqueness in politics.

    Perhaps, the major is to get on the morning shoes and, as you so strongly point out, rip scummo for his new introductions. He could attack the overseas ship building and buying costs especially the affaire du seicle and follow up on the $400m gifts whilst they are fresh.

    As for the election, Scummo got a boost to his ‘truth’of jobs by the image of shorten’s hand being refused by the yellow vest. The image looked so awful, it must have broken bill’s heart but it gave credence to labor not being the party of the workers,

    In the context of the lnp conservatives in my extended family, the golf club and my pages, ‘labor and the greens’ is toxic slogan. It inaccurate, they are separate parties, but the slogan labor and the greens was heard incessantly during the campaign. There was an occasional foray into another negative slogan labor and the unions but the clincher is the fear of the extremist loonies. Albo needs to become LABOR and Labor and labor

    The green caravan, with a vegan sideshow, was the clincher that convinced the workers that labor was a risk to jobs and the howard/rabbott’s lie of labor’s economic mismanagement and waste came back.

    My distrust and cynicism of the diludbransimkims control of the greens leads me to conclude that browns provocative incursion into adani was to bolster their southern vote. Spectacular success for the greens and a $9m payout and spectacular failure for labor and 23:6 in qld.

    However such attacks on the loonies and terms like narrow nose may have the support of conservative who loathe the greens but not appreciated by labor supporter sites.

    ps Kaye logic rarely figures when government money is available and rip off is not thought of as stealing???

  5. Kurt Liffman

    Dear Kaye Lee, I really like your posts as, I think, they are most factually accurate on this website.

    Removing the franking credits rebate for tax-free superannuates is a fiscally sound policy. I have no problems with the policy. However, to implement change you have to be in Government. In a democracy this means that people have to vote for you. In Australia, an overall 2.5% swing to Labor or Liberal is considered a “landslide” result.

    Labor’s franking credits policy would have affected hundreds of thousands of people. Multiply that by a factor for the surrounding family that would also have been affected. The voting population of Australia is around 16 million people. 2.5% of 16 million is around 400,000 people. So suppose 100,000 people change form Labor to Liberal due to franking credits and suppose another three in their immediate family do the same. That’s 400,000 people. Goodbye Labor government. You do the maths.

    Labor had great progressive policies, but they were total and complete knuckleheads with this franking credits policy. Politically smart people who can do basic mathematics should have seen this coming. They should have grandfathered the franking credits rebate or means tested it. Take the fiscal hit and win government. The result of Labor’s stupidity is that we have this terrible government forced upon the nation for another three years.

  6. Kaye Lee

    Kurt,

    I would have hoped more than 400,000 people thought more about the health of our planet and our society than about their inheritance.

    They could cap the refund amount for existing recipients to $5,000.

  7. Zathras

    Something that’s been conveniently overlooked is that after presenting his first budget, ex-Treasurer Joe Hockey said that franking credit handouts were “something that will definitely have to be looked at”. He also suggested that negative gearing should be made to apply to new dwellings only.

    Of course votes were not an issue at that time and fortunately for the government most people have short memories.

  8. Kaye Lee

    KPMG tax partner, Asset and Wealth Management, Damian Ryan has noted the manner in which the Australian Labor Party’s proposal to remove refundable franking credits impacted its election chances but said the politicisation of the issue only served to cloud the reality.

    “What was lost in much of the Election discussion around the removal of the refund of franking credits for individuals and superannuation funds, was the tax policy issue that is trying to be addressed,” he said. This is that as the Australian population ages, and as more shares are held by retired Australian individuals and/or superannuation funds with a significant proportion of members in pension phase, a significant part of the corporate tax base is refunded, thereby putting a strain on the country’s tax base.”

    “According to one view of tax policy, the imputation system is to avoid double taxation on the company profit. This view would support of view that provides an offset for the franking credit, but not a refund.”

    “Assuming that the current situation of refundable franking credits continues, then Australia will continue to refund part of its corporate tax base. The other alternatives are to accept the reduced tax base, and correct spending accordingly, or to revisit the tax base, including consumption taxes, which is just as politically difficult.”

  9. Kurt Liffman

    Kaye, Zathras, I am in furious agreement with your contributions.

    Unfortunately, as I said, when I spoke to these retirees – and I spoke to dozens of them. They could not care about any other policy. Health, Climate Change, Education, Childcare, Free 3 and 4 year old kinder etc etc. Nothing else mattered. They wanted their franking credits. They voted with their hip pocket. The World could burn. They could not care.

    Sorry to break it to you, but this is the reality that we have to deal with in this country.

  10. king1394

    Re franking credits, only some companies even offer franking credits, and those that do can withdraw them any time. They are not a gold plated guarantee.

  11. king1394

    Re that worker in the yellow vest, the one who reckoned he earned $200,000 per year. Did anyone ever find out who he was and whether he was telling the truth.? Yellow vests do not prove anything, but it is funny how the media was able tp focus on that particular fellow and catch what he said clearly. I bet there were thousands of other workers who would have been shaking Bills hand and wishing him well, but the media prefers the negative message where Labor is concerned

  12. Kaye Lee

    I am disturbed by how political leaders seem to have morphed into pseudo-celebrities. Asking people if they want a selfie with them???? Parading their families around???? Telling us what football team and music they like????? Filming them at church????

    Enough with the staged photo shoots and the magazine puff pieces.

  13. Matters Not

    I did say, many moons before the election, that the changes to franking credits was a dead set vote changer – unlike so many other ‘feel-good’ and intrinsically valuable policies. Hit the hip-pocket and you have a fight. Penalising retirees who planned for retirement is fraught – especially when the biggest and most valuable asset (the house) flies well below the radar. And that asset can have unlimited value.

    Certainly, a part pensioner was promised up to $16 000 cash refund via franking credits and a member of a superannuation fund considerably more, but there was no principle advanced.

    Further, the initial intention was made clear in Bowen’s first announcement where there was to be no cash refunds for anybody, yet he boasted about it being a well-thought through policy. Macklin demonstrated it wasn’t, and the electorate as a whole had their say on the later revisions. He lost it at the start.

    Politically, it should have been grandfathered or perhaps capped or taxed. Better still, the whole franking credits policy should have been looked at.. It’s a lemon.

    Australia and New Zealand are now the only two OECD countries to operate dividend imputation systems. Countries that have abandoned dividend imputation systems include the United Kingdom (in 1999), Germany (in 2001), Finland (in 2005) and Norway (in 2006).

    Those on very high incomes liked it and still do because it allowed them to pay high marginal tax at the company rate. Keating had friends in high places.

    ‘Double taxation’ happens all the time – and in a variety of ways. GST, for example, is paid by wage-earners from incomes which have already been taxed.

    Seems to me that the whole taxation system needs to be looked at and that includes incomes from pensions, regardless of source. It’s only a matter of time. And it’s for a whole range of reasons.

  14. Kaye Lee

    If they want to talk about double taxation, they should consider the taxes charged on interest earned on savings.

  15. Kronomex

    “I am disturbed by how political leaders seem to have morphed into pseudo-celebrities.” The blame for that garbage can be pretty well much laid at Murdoch’s feet.

  16. RomeoCharlie29

    It all comes down to lies and deceit. It was not necessarily the Franking credits issue per se, it was the lies told by the opponents that it was a retirees tax, a lie on two counts. I think there was some pensioner protection offered by Labor after the first big backlash but overall it was too easily manipulated and very poorly defended. I agree it is hard to see how Labor didn’t see that this was a shit sandwich too far for many people who should have been supporters.

    I do not hold out any hope that the new Morrison government will introduce any meaningful reforms addressing financial unfairness. In fact, as I might have said previously, I expect anyone but the wealthy to have a really hard time of it over the next three years.

    As I have also said elsewhere, those who didn’t vote LNP need to constantly point out the narrowness of the win and the doubtfulness of the mandate.

  17. Matters Not

    Want to appreciate the scope of the ‘superannuation’ problem. Try Pascoe:

    We currently have a tax break on putting money into super, a tax break on what is earned by that money while it’s in the accumulation phase, and then a total tax break on what is earned and paid out in the pension phase.

    It’s that last break, delivered by Peter Costello in 2006, that blew restraint off the superannuation system, seeding serious problems for future treasurers’ budgets by creating “the world’s most generous tax haven”, as it was a little sheepishly described to me by a now-retired tax partner.

    But there’s more:

    Assuming a conservative five per cent dividend yield, that limit still allows a retired couple with the limits introduced to have $3.2 million in super and receive a tax-free income, including franking refunds, of $228,000 a year without touching their capital. …

    To put the money in perspective, to receive $228,000 after tax, an individual would need a taxable income approaching $400,000 a year – putting them in the top one per cent of earners. …

    According to Quantum Financial analysis, Australian Tax Office figures show there are some 750 SMSFs holding between $20 million and $50 million, about 60 SMSFs holding more than $50 million, and a score or so with more than $100 million. Nice.

    https://thenewdaily.com.au/money/finance-news/2019/05/29/retirement-income-review-josh-frydenberg/

    If you want to do something about it. (And at some stage you must.) Then do what smart politicians do – commission an inquiry. Make sure Members of that Inquiry come from across the spectrum – unions, employers, welfare groups, ex politicians of all stripes etc, etc – the whole box and dice. Write the Terms of Reference so that the whole mess is exposed; the recommendations are subsequently dire so then the Government has plenty to hide behind – an Expert, Non-Partisan Group. It’s called Politics 101. It’s what Shorten should have done but left it all to Bowen – the political child who faced the future buck naked. And then he was convicted of political porn.

    Bet he learns.

    https://thenewdaily.com.au/money/finance-news/2019/05/29/retirement-income-review-josh-frydenberg/

  18. Zathras

    I’m one of those self-funded retirees and have a small amount of shares that get me about $150 per year in franking credits – less than what an accountant would charge me to submit a tax return on my behalf.

    There’s been some discussion between other retirees I know about cashing out some of their investments and moving more heavily into shares so they can get their hands on some of that “free money”.
    What they don’t realise is that when there’s another (inevitable) correction in the market the value of their shares are likely to fall enough to cancel out the value of that handout – and more – and then they’ll be the first to complain.

    Meanwhile a large migration of retiree funds into the share market will place further stress on government finances through those credits and the government will be forced to take some sort of action.

    The scheme was introduced by a panicked Howard as a way to buy votes and has been another legacy to sabotage the national economy ever since.

    How reasonable is it to work for 40 years and then coast along tax-free for another 40 or so without making any further contribution to society (apart from consumption) while adding to the national health bill?

  19. Henry Rodrigues

    Fat chance of anything approaching tax reform as long as Murdoch and the rest of the corrupt MSM are dead set against it. Just as the recipients of the tax free largesse consider it their god given right to receive, so to are the practitioners of tax avoidance, tax evasion, offshore tax havens, the tradies who manipulate their tax returns, the owners of trust funds, the users of the diesel fuel rebate, the list goes on and on, and will continue long after Scummo and his band of tricksters depart from the scene.This country is hostage to the well to do with all the ‘right’, powerful and lucrative connections that the corrupt media affords them. Like the 75 millionaires and the 575 companies who paid zero tax, and the ‘humble’ mum and dad property investors who get the taxpayer to finance their retirement nest eggs, they scream the loudest at the prospect of losing even an iota of their ‘entitlements’.

    Tax reform ???? Not in our lifetimes, if ever. This election just proved that.

  20. Kronomex

    There is going to be tax reform over the next three years. Taxes will be reformed to keep the 10% happy and rich and the 90% get to cover the costs.

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