How the whole nation hung on every word of Australia’s federal Treasurer last night! We were enthralled at how the government would deal with ‘the terrible socio-economic damage COVID-19 has caused’ (sic). The property bubble was invisible, as always.
Aren’t we fortunate to have all those federal government departments providing input to the budget, and Treasury pulling all the threads together, as best they could with the Liberal party putting their stamp on the outcome? Businesses fared much better than the precariat, the class at the bottom which has come increasingly to include large parts of the middle class: “Job, jobs, jobs!” said Treasurer Frydenberg.
Now, let’s take a step back. Could there be any better example of Upton Sinclair’s statement: “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”? There were probably a thousand bureaucrats working on the budget and many millions watching it.
What did the bureaucracy do? It considered the myriad issues greatly exacerbated by the virus. The budget then committed enormous sums of money to be tacked onto as many of these particular issues as was thought possible. There you have it! No reforms! Well, there was one: taxation was reduced. [Unfortunately, many Australians who seem to believe that federal spending comes out of taxation are greatly annoyed with tax cuts: the hair shirt brigade.]
With all that money being spent, was anything done to address the fundamental economic failures that have been addressed in inquiries previous to the arrival of COVID-19? No, none.
We didn’t take the opportunity to address the concerns of the Henry Tax Review about too many damaging taxes, and the need for a significant all-in land tax to stem some of the tax avoidance and to keep a lid on land prices. In ten years, we’ve implement only two of 118 recommendations of a comprehensive report. Only 116 to go.
Nor did we do anything structural to put an end to ‘the trickle-up economy‘, to stop the widening income gap, and to care for the growing precariat. Wouldn’t a ‘living wage basic income’ have provided a little comfort and security to many people? Wouldn’t it also assist struggling businesses who’ve been making marginal profit? How would it do this, do I hear you ask? Well, with a living wage basic income in place, businesses would only have to offer an amount additional to the basic income, sufficient to attract employees. There’s a cost saving! Both sides should jump at the chance to implement a living wage basic income, but genuine reform is overlooked in petty politicking.
Last night’s budget could have acted to remedy the overarching ills that assail us, including delimited wages and profits–except for those of CEOs and monopolies doing marvelously, of course–instead of simply tacking money onto the multitude of problems that grow from not addressing what creates them.