Despite the fact that Federal Labor has consistently led in opinion polls over the last year or so by between four and six percentage points, most pundits (including the writer) have very little confidence that Labor will win the next election. In fact I expect they will more than likely lose.
Bill Shorten (assuming he survives as leader) is unlikely to win by continuing with his small target “me too” strategy where there isn’t a cigarette paper’s width between the policies of Labor and the Coalition on hot button issues like national security/terrorism and asylum seekers.
This article is based on the (admittedly courageous) proposition that a small target strategy is not the only way to win an election from opposition. It is possible to achieve government by winning people’s hearts and minds with an imaginative and popular positive policy platform, even though the last Opposition Leader who succeeded in doing so was Gough Whitlam in 1972. Of course I might be wrong, but here is my stab at an election policy manifesto that I reckon Shorten or his successor should adopt:
- Corporate tax cut – Cut the company tax rate by 5% to 25% (a little less in the case of small companies). Australia’s current company tax rate is 5% higher than the OECD average, and this is clearly having an effect on our competitiveness and attractiveness to overseas capital.
- Cut the adult minimum wage to $12 per hour (a cut of a little over five dollars per hour). Australia’s current minimum wage is the highest in the world bar none. It is clearly contributing to the shutdown of our remaining manufacturing industries and the high and growing rate of long-term unemployment. Low-skilled workers are simply priced out of the marketplace – they cost employers more than the income they generate for the business.
- Implement a negative income tax equal to the cut in the adult minimum wage, so that low income earners do not lose out.
- Employee benefits to outsourced workers – Require the actual “employers”/end users of longer term pseudo-independent contractors, casual workers and employees of labour hire companies to provide a fully portable package of basic employee benefits to their workers, including annual leave, sick leave, long service leave, superannuation etc.
- Require banks to give mortgage interest and repayment holidays to unemployed workers for up to 6 months. – Given that banks now get the overt benefit of government guarantees of their solvency, it isn’t unreasonable that they be required to fulfil a basic social contract function like this. Obviously they will pass the additional cost on to their customers, but I doubt that most people would begrudge a tiny increase in borrowing costs given the peace of mind this measure will generate. In an age of increasing insecurity, “there but for the grace of God go I” is a ubiquitous and debilitating feeling.
- Re-introduce the full needs-based Gonski education funding package partially abolished by the Abbott government.
- Require the States to abolish stamp duty on real property transfers. This would enhance labour mobility.
- Convene a Tax Summit of all business and community “stakeholders” towards the end of the new government’s first term. Its task would be to build on the work of the Abbott government’s forthcoming Tax White Paper and seek broad agreement or at least general understanding on a suite of measures to get the federal budget back to structural surplus (to the extent that the stimulatory effect of some of the above measures does not grow the economic cake by enough to make tax increases unnecessary). Abolishing or quarantining negative gearing deductions on residential rental properties; taxing superannuation contributions as income; and seriously cracking down on multinational company tax avoidance would all be obvious targets for discussion.
- Guest worker visas for northern Australia – Enter into agreements with our neighbours Indonesia, Malaysia and East Timor to allow guest workers to come and work in northern Australia for up to 5 years on a streamlined, low red tape visa system.
- Negotiate offshore asylum seeker processing agreements with Indonesia, Malaysia and East Timor, whereby Australia would pay the full cost of accommodating and processing asylum seekers in those countries, they would officially sanction boat “turnbacks” to the extent necessary to deter irregular arrivals, and Australia would agree to source the vast majority of our offshore humanitarian migrant intake from people found to be refugees after offshore processing in those countries. In the meantime, continue with the current offshore processing arrangements with the corrupt regimes of Papua New Guinea and Nauru, but with vastly enhanced safeguards and transparency to ensure humane treatment.
Shifting the national discussion onto these issues would refocus political debate onto the positive mindset of how to make Australia a fairer and more prosperous country, while inhibiting Tony Abbott’s relentless “three card trick” fear and loathing campaign on confected or exaggerated national security issues.
As regular Troppo readers would be well aware, I am not an economist. I would be very interested in whatever feedback our numerous economist readers might have on the above policy ideas. I know it’s very unlikely they will be adopted given current conventional political wisdom, but I still think it’s an interesting and potentially worthwhile thought game.