The morning after

I’ve been a bit slow with this newsletter, So much of the news is too depressing to say much about, but I will try.

As regards the Voice, I can say “I told you so”, but that is cold comfort. A better strategy (legislate first, then entrench) might have worked, but it’s too late for that now. There is no easy way to repair the damage done to Australia and even more to First Nations people, by this defeat.

Albanese has promised to work Closing the Gap, but that will take a big shift in policy. The measures announced in the 2023-24 Budget, although welcome, are nowhere the scale required to achieve the goals of Closing the Gap.

---

And, with the defeat of the Voice, there is very little left of the Albanese government’s modest 2022 election agenda to to 2025. The other headline proposal, the Housing Australia Future Fund, was a sham, but at least the resulting debate produced some more money for social housing. A lot of people got enthusiastic about a Federal ICAC, and we may see some prosecution of the most egregious wrongdoing under the previous government. But it is already clear from examples like the Qantas fiasco that Labor is not going to transform governance in Australia. We can look forward the reversal of some of the worst policies of the previous government (Parents Next, Job Ready Graduates and so on), but almost nothing in the way of new initiatives.

There has also been some talk of a renewed push on climate policy. That will face an early test when Tanya Plibersek decides on the fate of a coal project even worse than those she has previously approved. As I point out here, the ‘drug dealer’s defence’ offered by the government for these approvals (if we don’t sell it, someone else will) contradicts basic economics, but that’s unlikely to stop them. And Albanese’s bitter hostility to the Greens looks likely to rule out any real attempt at a united effort.

In fiscal terms, the government is hamstrung by its commitments on tax (the Stage III cuts), defence expenditure (AUKUS) and public debt reduction. The only way to meet all three is to exercise stringent constraint on spending and refuse any tax relief for low and middle income earners. The decision to allow the Low and Middle Income Earners Offset to expire was a clear indication of that.

My expectation is that the government will limp to the next election where it will lose seats to both the LNP and the Greens/independents. With luck, the LNP won’t be able to form a government and Labor will need the support of Greens and progressive independents. I can’t see Albanese making the necessary compromises (particularly if it involves a deal with the Greens), and I also can’t see Labor going for a new election. In the absence of some radical shift, Jim Chalmers is the obvious replacement for Albanese. I can’t way I view that with much enthusiasm, but he might surprise us.

The situation in the wider world is also pretty grim. I don’t have much to say except that the use of violence to pursue political goals is, almost always, both a crime and a mistake.

Given all this, I plan to take some time away from day-to-day politics. I hope to think about longer-term issues, such as the future of work and the information economy (or, as I’ve argued in the past, non-economy). I’ll also keep doing what I can to help the struggle against global heating. And I’ll be happy to suggestions on other things I should be thinking about.