archive: May 2021

13 May 2021

Alison Pennington: “After last year’s widely critiqued ‘hard hats’ budget, with its narrow focus on announcing big construction projects (many of which still haven’t got past the photo-op stage), this year the Coalition announced $3.4 billion in funding over four years to purportedly address women’s economic security, safety and health. Keep in mind, that represents just 3.6 per cent of the total $96 billion in new tax and spending measures announced in this budget. The extra spending on women consists of small amounts of money divided across lots of different things. Like a low-quality showbag, these measures are short-term sweeteners. Perishable after the forward estimates. … Much-needed funding for domestic violence services will increase by $250 million per year — but is then cut by 99 per cent, down to just $2.3 million, in 2025-26. Apparently, the violence crisis will be over by then. In total, this is small, short-term spending for women, compared with permanent and much more expensive changes announced for high-income earners and men. … The wages crisis hits women hardest, and a budget that ignores wages could never be called a ‘women’s budget’. Four million women or 65 per cent of all women’s jobs are in low- and middle-income services industries like hospitality, retail, and health care and social services. … What good is money spent on getting women into the workforce, if they’re not earning enough on the job?“

12 May 2021

Gareth Hutchens: “The last time we saw annual wage growth of 2.75 per cent was in 2014. But if the budget forecasts turn out to be correct, and we see wage growth of 2.75 per cent by July 2025, it means Australian wages will have been weaker than 2014 levels for over 10 years. A full decade. And if you look at that graph again, wage growth of 2.75 per cent is still far below where it was in the mining boom years. Why do Treasury officials think it’s going to take so long for wages growth to pick up from here, given the government’s well-publicised plan to drive the unemployment rate down to 1970 levels? The budget papers hold a few clues: ‘The near-term outlook is consistent with low-wage increases in new federal enterprise bargaining agreements [more info] and state public-sector wage caps that are expected to moderate the outlook for wage growth over the forecast period.’ That is, wage growth is still going to be deliberately held back in coming years (in some areas). According to the budget papers, inflation is forecast to grow by 1.75 per cent in 2021-22, while wages grow by 1.5 per cent. You know what that means? Treasury officials think ‘real’ wages will actually go backwards in the next 12 months (which means the purchasing power of your wages will decline). And for the next two years after that, inflation will track at the same rate as wages, so real wages will be treading water. So that’s three more years, at least, of anaemic wages.”

Greg Jericho reckons Morrison is planning for years of frozen wages: “The wild fluctuations of the pandemic make it is difficult to discern what is going on when looking at the growth figures. For example, the budget predicts our economy to grow by 4.5% in 2021-22 — a stonkingly good result. But given that it comes off the back of two years where our GDP shrank and then grew by just 1.25%, it’s not a real shock… [T]he tale of this budget for me is mostly in the following three years — for there we see a return to the weak growth of the past decade.Yes, some of it has to do with lower population growth, but even by 2022-23 the government estimates our population will grow by 0.8% — marginally down on the 1.2% growth of 2019-20 but massively above the 0.1% growth this year. Yet our economy is expected to still grow below the long-term trend of 2.75% to 3%. Worse, the news remains ever-dismal for workers. There are some good signs — the government is predicting unemployment will go below 5%. By June 2024 it expects 4.5% unemployment — the lowest since the global financial crisis. And yet wages growth is expected to be dire. … Over the past five years an unemployment rate of 5% — as occurred in December 2018 — would see wages growing by about 2.3% each year. Now, however, the budget predicts an unemployment rate of 5% in June next year, but wages growth of just 1.5% … [T]he budget only forecasts wages growth increasing to 2.5% at best. That is well below the level the governor of the reserve bank, Philip Lowe, suggests is needed to get inflation consistently within the RBA’s 2% to 3% target band. Despite this the government predicts inflation will grow by 2.5% in both 2024 and 2025 — effectively meaning wages growth will be negligible for years to come”.

Ross Gittins: “Politically, this budget had to offer a convincing response to the report of the royal commission on aged care. Reports have suggested fixing the broken system would take extra spending of about $10 billion a year. Had he accepted that challenge, Morrison would have put himself head and shoulders above his Liberal and Labor predecessors. He settled for spending an extra $3.5 billion a year. Major patch-up at best. The scandals will continue. Politically, Morrison had to make this a women-friendly budget, to prove he valued women’s contribution to the economy and remove impediments to their economic security. Making childcare free — as it was, briefly, during the lockdown — would have been a big help to young families, as well as greatly increasing employment. It would have backed his fine words with deeds. That would have cost about $2 billion a year. Morrison settled for $600 million a year, limiting the new assistance to about one childcare-using family in four by excluding the great majority, who have only one child in care. … [T]he purpose of the further stimulus in this year’s budget is to keep the kick-starting going until the private sector’s engine gets going. Much of this depends on a return to decent pay rises – which is, as yet, beyond the budget’s ‘forecast horizon’. We haven’t had a decent pay rise since before the election of the Coalition government.”

11 May 2021

Benjamin Clark urges Albo to read the room: “The Labor leader took a rare opportunity to share his moving personal history and articulate the values it imparted. ‘I know the difference that governments can make on people’s lives because I lived it,’ he wrote. ‘Mum lived it.’ Alas, the advisers who vet Albo’s social media posts could not let an articulation of working-class pride slide without appending some cynical triangulation. ‘She taught me how to save,’ he wrote. ‘And how to spend wisely — because every dollar had to count.’ The line echoed a speech Albanese delivered on Thursday, in which he invoked Kevin Rudd’s famous ‘economic conservative’ slogan, reiterating a promise to keep government spending tight if he is elected PM. ‘Money was always tight at our place,’ he said. ‘That’s why, when it comes to thinking about government spending, I am cautious.’ The speech was dropped to The Australian, in an apparent effort to signal Labor’s fiscal discipline. It comes after Albanese asked shadow cabinet members in February to attempt to offset all new spending proposals with cuts. This fiscal frugality sees Albo sounding even more hawkish than Treasurer Josh Frydenberg, who has … declar[ed] it is no time for an austerity budget so soon after the coronavirus recession. … Polling also suggests the Australian public agree deficit reduction is a low priority. Why, then, is the ALP still projecting a ‘miserly bean-counter’ image?” Not a good sign.

3 May 2021

Sean Kelly: “I was shocked, initially, by the announcement of the India flight ban. But once the government announced the accompanying prison terms, the shock, for me, wore off. What had seemed odd was made suddenly familiar. Banning citizens from returning to Australia sounded new – but imprisoning desperate people for years at a time for the supposed crime of fleeing desperate circumstances? That is the oldest trick in the Australian political playbook. … The task Morrison’s government too often appears engaged in is … deciding who counts as ‘Australian’, and the circumstances in which our government will accept them as such. Thus Australian citizens in India can be treated as non-citizens. Chinese Australians can be treated as potentially disloyal citizens. Indigenous Australians can be treated as citizens whose lives are worth not quite as much as those of white Australians. In two recent speeches, Scott Morrison has attacked identity politics. … If there is a form of identity politics dividing this country, it is this: the idea that a white suburban bloke is a typical Australian, while the ‘Australianness’ of every other Australian is always doubtful, on the brink of being undermined. For many Australians, most of the time, such fears will seem abstract. The disregard our government showed this week for citizenship itself makes that danger concrete. Concern about it should unite us all.”

1 May 2021

Eric Hobsbawm: “My present subject is perhaps the only unquestionable dent made by a secular movement in the Christian or any other official calendar, a holiday established not in one or two countries, but in 1990 officially in 107 states. What is more, it is an occasion established not by the power of governments or conquerors, but by an entirely unofficial movement of poor men and women. I am speaking of May Day, or more precisely of the First of May, the international festival of the working-class movement… [R]efraining from work on a working day was both an assertion of working-class power — in fact, the quintessential assertion of this power — and the essence of freedom, namely not being forced to labour in the sweat of one’s brow, but choosing what to do in the company of family and friends. It was thus both a gesture of class assertion and class struggle and a holiday… It is, in fact, more universally taken off work than any other days except 25 December and 1 January, having far outdistanced its other religious rivals. But it came from below. It was shaped by anonymous working people themselves who, through it, recognised themselves, across lines of occupation, language, even nationality as a single class by deciding, once a year, deliberately not to work: to flout the moral, political and economic compulsion to labour.”