(For my American readers, Labor = Democrats, Liberals = Republicans)
God, I hate the week before Budget Day. All those orchestrated "leaks", and the government "refusing to rule out" the "rumored" cuts. All a strategy to drip-feed the painful bits to us so that no one is too shocked on the day and the government can hit back on criticism with messages they have practiced.
Aaargh - just give us the damn budget already!
And the whole malarkey both sides of politics play, known by everyone, played by everyone, annoying everyone on all sides equally:
Current government [whoever it is at the time]: "Your side stuffed everything up; we're trying to fix it, but we're still dealing with the legacy of what you did"
Opposition government [whoever it is at the time]: "How come when we tried to do [thing] you opposed it and now you're doing [same thing]?"
If the Labor government attempts to introduce means testing for benefits, Liberals call this "class warfare".
If the Liberal government attempts to introduce means testing for benefits, it is called "being responsible".
Liberal and Labor are different. They have different philosophies and they govern differently. But the people in charge of the economy on both sides are not too dissimilar in their basic economic beliefs, these days. Everyone knows and agrees that economies have to be lightly managed and vibrant, that business and entrepreneurship have to be encouraged, that growth is necessary, that everyone is better off when interest rates are low and business is booming.
Everyone has been in broad agreement for some time that we have a deficit and it has to be brought under control.
Everyone has been in broad agreement for some time that the tax system is too convoluted, there are too many transfers, and "middle class welfare" has got a little bit out of control.
Labor didn't ignore the deficit. They were unable to do much to fix it because (a) GFC required massive stimulus requirement, (b) their every move was thwarted by a hung parliament, and (c) internal in-fighting.
Liberals accuse Labor of reckless spending and mismanaging the economy. Labor for some reason (maybe because it does have a tendency to spend?) is terrible at refuting this argument, even when it is wrong and grossly unfair.
Does no one remember 2008? After the GFC it was the mantra of every central bank and economist in the world: Spend! Spend! Stimulate the economy!
Unfortunately, Labor happened to be in power when that happened. Hence the horrific home insulation debacle (in which three contractors died), and the ridiculous "Building the Education Revolution" which has left every school everywhere with a state of the art building awkwardly placed and of indeterminate functionality.
(Labor is its own worst enemy most of the time. Speaking of class warfare: Comrades, can we please agree not to use words like "revolution" perhaps?)
So Labor spent all that money because CRISIS and STIMULUS and GFC. And Liberal would have done the same thing, though no doubt would have spent the money differently.
One does leave oneself open to charges of "mismanaging the economy" when one's remit is based around social equity instead of trickle-down economics, I suppose.
So back to the Budget.
What do we have so far?
Deficit levy: a tax for four years on a scale based on taxable income, to pay off the national deficit. This one won't hit me with my current pay packet, so I'm going to mark it REASONABLE. We are in debt after all, and everyone (earning more than me) has to chip in! (Heh heh...)
Aged Pension: possible raising of the qualifying age from 65 to 70 (though more seems more likely now in a future budget). Has been talked about for some time, an evil we all knew was coming at some stage. Everyone my generation and younger expects to be working until they're eighty anyway. Very bad for people approaching retirement age now, and for workers like my husband who do back-breaking physical jobs. I'm calling this one HARSH BUT INEVITABLE.
possible cuts to "middle class welfare" such as Family Tax Benefit, Schoolkids Bonus, Carbon Tax Offset, Childcare Rebate etc. Speaking personally, my family only just became eligible for these and now we may lose them. DAMN.
possible cuts to REAL welfare, such as Newstart, single parent payments, carers' pensions, etc. This is BAD. These benefits ceased being any kind of a loafer's gravy train years ago, and their recipients are on the poverty line. These are people who really need that support, and the payments go right back into the economy after all - not too many of these people socking their wealth away or sending it offshore.
Medicare co-payment: $6 to be paid for bulk billed doctor visits. WRONG. Undermines everything about what Medicare is and opens the door to effectively ending it. (Americans, imagine the OPPOSITE of your fears about Obamacare!). Instead of doing that, governments should make bulk billing means-tested.
possible removal of private health insurance rebate: BAD. The rebate exists to encourage people to have private health insurance and reduce drain on the public purse for health. I guess it is debatable to what degree it actually achieves this though. Still, you remove this, you will see even more people jettisoning their private health cover, which is bad news for public health costs.
paid parental leave scheme: Do you know, I've come round a bit to this one. On the face of it it sounds a bit outrageous, but I have a feeling that it's one of those things that five years down the track I'll be embarrassed I didn't support. And it will mostly be funded by business, so it isn't that expensive to normal taxpayers. And women should be supported to take adequate maternity leave and to return to work. So that's all good. But if heavy cuts are going to be made to pensions, carers' pensions, the national disability insurance scheme and welfare payments, then I have to say the previous high threshold on this one was looking a bit on the nose, so I had pegged this one until this morning as DICEY. But now it's been announced that the means-test threshold has been reduced to $100,000, which is better. Higher-paid women are most likely being given this by their employers anyway, and the main beneficiaries of this scheme will be lower-paid women, which everyone seems to forget. So this is now OKAY.