If you were to believe the Sydney Daily Telegraph, the Albanese government’s latest budget is a “big taxing communist manifesto” and “the most radical redistribution of wealth since the Whitlam era”. Other Murdoch outlets followed suit. It was class war on the backbone of the nation, the boomers, the “mum and dad investors” and the entrepreneurs. Socialism reborn.
As far as the government is concerned, though, this is a budget that finally tackles “intergenerational inequality”, specifically by winding back regressive tax lurks that have enabled landlords to get away with billions in tax avoidance since the Howard government introduced them a quarter of a century ago. ABC and Nine masthead newspaper columnists joined in, praising Treasurer Jim Chalmers for giving the younger generations hope that they may one day buy their own home. Finally, a government standing for fairness.
If only.
The budget incorporated a series of tepid tax reforms whose impact on housing affordability and availability will be marginal at best. It was so radical that plenty of mainstream economists lined up on budget night to welcome them as long overdue change. So radical that the stock market barely blinked.
Far from being “communist”, an assault on Australia’s capitalists, the budget leaves the capitalist class almost unscathed. Some may have to pay a little tax on the trusts they have used for decades to squirrel away their wealth, safe from the taxman. But this modest tweak is far outweighed by what the government didn’t do.
It didn’t introduce a super profits tax on the gas industry, a popular measure that would have generated tens of billions of dollars in funds in the coming years. It didn’t increase corporate tax rates. It didn’t introduce a wealth tax, the only thing that can make a dent in the fortunes of the richest families. It didn’t introduce higher marginal tax rates on the country’s top “earners”. The government may talk about “intergenerational inequality”, but it leaves class inequality untouched.
The government is doing nothing to rein in some of the biggest capitalist boondoggles out there: the tens of billions of dollars handed out to private operators in aged care, childcare, “affordable housing”. Since the neoliberal revolution ushered in by the Hawke and Keating governments in the 1980s, public provision of services by government agencies and departments, already feeble by international comparison even in its heyday, has been replaced by contracting out to private operators who will only operate services and build homes if their pockets are filled with taxpayer funds.
It is this model of “responsible government” that leads to the shocking standards in aged care homes and childcare, and a constant turnover of staff sick of the overwork and poor pay. This entire model remains. A crash program of public-sector homebuilding that takes access to a secure home out of the clutches of the landlords, the property developers and the banks? Not a chance. Instead, first home buyer schemes that drive house prices higher.
The attacks on the National Disability Insurance Scheme encapsulate the government’s right-wing approach. There is a crying need for serious government funding for services for people with disabilities. But the NDIS was never that. As with aged care and childcare, the NDIS outsources service provision to the private sector. By design, it has become a honeypot for thousands of shonks who have driven up the cost of the NDIS year after year. The government’s reaction? Not to scrap the system and start again with a publicly operated system affording care for those who need it and decent working conditions for those who staff it. Instead, it is cutting planned spending by $15 billion and booting off an estimated 160,000 clients over the next four years while promising to tackle the shonks in an industry where shonks are a design feature, not an error.
Almost unmentioned in the cries of doom from the Murdoch journalists or the paeans of praise from the liberal and centrist media was the budget’s obscene expansion of military spending—up by another $15 billion in the next four years and $53 billion over the next decade. Twelve billion dollars to expand the Henderson shipyards in Perth to service the nuclear submarines on their way and to build the new Japanese-designed frigates. Billions more to expand the military footprint in the Northern Territory.
That the media made next to nothing about the ever-growing outlay of funds on the military at a time when all agree that reining in the budget deficit is a priority tells you everything about how normalised Australia’s growing militarism has now become. With the bipartisan commitment to spend $368 billion on the AUKUS nuclear submarines, the political establishment, right-wing and centrist alike, is happy to sign blank cheques to the warmongers, no questions asked.
At a time inflation is running at 5 percent and likely to rise still higher in the coming months, wages are growing by barely 3 percent. After a brief reprieve, we’re back to another round of real wage cuts. What is the government doing about this? Are we supposed to be grateful for the pitiful $5 a week tax offset, or the 1 percent cut in tax on the lowest incomes? These will quickly be eaten up by bracket creep as rising nominal wages push workers into higher tax brackets. Or the cuts to public service jobs?
There are billions of dollars for construction companies to build infrastructure and housing, their way cleared by reduced environmental and workplace health and safety protections, but precious little for public schools and hospitals.
The government’s talk of fairness and tackling inequality is empty noise. Yet in some ways, the budget is ambitious: it is characterised by an ambition to keep Australian capitalism’s winners rich and its losers poor.
