On a day when Australia was preoccupied with COVID-19 outbreaks in its two largest cities, Labor leader Anthony Albanese was in Queensland quietly announcing two major policy reversals: the ALP would support the Coalition’s stage three tax cuts for high-income earners and would abandon plans to clamp down on negative gearing and capital gains tax.
The decisions were unanimous in shadow cabinet and were endorsed by caucus on Monday, and are part of Labor’s strategy to avoid a repeat of its shock 2019 election loss: give the Coalition fewer lines of attack on economic issues while homing in on its messaging on Prime Minister Scott Morrison’s quarantine and vaccine rollout failures.
The decision
Once upon a time, opposition Treasury spokesman Jim Chalmers called the government’s stage three tax cuts — everyone earning between $45,000 and $200,000 pays a flat rate of 30% from 2024 — unfair and ineffective. Once upon a time, former leader Bill Shorten fought two elections, promising to crack down on capital gains tax deductions and restrict negative gearing on the basis that the policies disproportionately favoured wealthy property investors and exacerbated housing inequality.
Yesterday Albanese said the changes were about providing “stability and certainty” to working families, a phrase that Labor frontbenchers have returned to frequently since then. Despite house prices reaching nearly 20-year highs, Labor is walking away from its negative gearing policy, promising to tackle other sources of inequality including supply and social housing.
The reaction was predictable. A gleeful Finance Minister Simon Birmingham said the decision couldn’t be believed: “What we’ve seen today from the Labor Party is perhaps the most agonising, the most half-hearted concession in Australian politics ever.”
Greens Senator Mehreen Faruqi called it a betrayal: “This is a cowardly and pathetic backflip. House prices and rents are skyrocketing, and Labor is throwing fuel on the fire.”
Ghosts of 2019
Yesterday Albanese said the new approach was about looking ahead to the election: “As Labor leader, I am absolutely determined to look to the future, not relitigate the past.”
But the decision is a sign of a party haunted by the 2019 election loss. The party took a grab bag of often confusing savings and tax policies to the electorate which provided ammunition for highly effective Coalition scare campaigns that seemed to resonate.
But former Grattan Institute CEO John Daley says the U-turn was the result of a party too obsessed with winning the 24-hour news cycle: “You’re surrounded by advisers who think that’s the only thing that matters, and don’t have anyone who thinks long term, or who doesn’t have the memory of a goldfish.”
Labor’s internal review of the loss — led by former minister Craig Emerson and former South Australian premier Jay Weatherill — didn’t single out negative gearing alone for losing. It found they were used to fund large spending measures, the sheer volume of which were used by the Coalition to create a narrative of Labor fiscal profligacy.
The Grattan Institute’s analysis found booths which swung hardest to Labor were those most adversely affected by changes to negative gearing and capital gains tax, a finding reflected in the party review. In other words, Labor won rich people, but went backwards among lower-income, and in particular less-educated, voters.
“If you read Labor’s own review, it found they did not lose because of the tax stuff,” Daley said.
But Emerson said the decision was “fully consistent” with one of the review’s key recommendations: take a handful of key signature policies to the next election and minimise lines of attack for the Coalition.
But it’s meant the party’s abandoned a widely popular policy, backed by experts and even some business groups at a time of historic housing inequality.
Should Labor give up these policies just to keep it safe from Coalition attacks? Send your thoughts to letters@crikey.com.au, and please include your full name if you’d like to be considered for publication.
Labor you must do what it takes to get elected, the future of the nation depends upon it. Once elected you can do a Coalition and utter the words: non core promise
Allan, you sound like you really think that the ALP would do something meaning if it gained office. With the greatest of respect Allan, if you think that then you are delusional or at least very naive. This party is, by and large a waste of space.
As opposed to the LNP, which is currently exhibiting total control and an excess of capabilities. FFS
Why all the negative votes?
The coalition government is the most corrupt and incompetent in living memory.
The planet is frying.
If ever there was a moment for a party of vision to stride forward with a coherent set of bold policies, this is it.
But no, we get a timid little mouse of a Laberal party.
Vote Green and hope for a hung parliament I say!
Why all the negative votes you ask, Barnino?
Your guess is as good as mine. You would have to query those who cast them.
I suspect though Barnino, that there are still many naive people around who actually think that the ALP represents a credible and real alternative. Nothing could be further from reality (despite all the sound and fury spouted by the Murdoch media about the ALP prior to most elections). I am flabbergasted that there are so many people, especially at a site like Crikey, who cannot see through the facade of this ‘pretend opposition party’.
Better a pretend opposition than this facade of a simulacrum of a govt. What drives you, politically, Robert? A band of monkeys would be better than the current govt.
Pretend opposition leader because he refuses to insult women ?
Clueless in the art of buying marginal electorates also.
Paul Bongiorno TSP:
Labor’s pivot on the high-end income tax cuts is aimed solely at making Morrison and his handling of the pandemic the main focus of the election campaign…29 per cent of NSW voters are satisfied with Morrison’s handling of the rollout, with 62 per cent dissatisfied. The findings on his handling of quarantine are equally dire: 33 per cent approve, while 57 per cent disapprove.
A freedom of information request from The Canberra Times resulted in more evidence of extravagant ineptitude in the setting up of the COVIDSafe app, where $10 million was paid to private contractors. It is still costing $60,000 a month to keep running.
Despite heavy redactions, the report found the app identified just 17 close contacts since its launch in 2020, in situations where the contact was not identified by manual tracers. That’s $1.5 million for every contact it uncovered.
No wonder Albanese wants to make sure nothing distracts from Morrison’s record in this national crisis when voters turn their minds to a better option to take the nation forward at the next election.
Ahh, if wishes were horses… I’ll probably have to vote green, at least in Richmond we have Mandy Nolan running. Super funny comedian, excellent raconteur and writer, very smart, let’s hope she can breathe some life into the otherwise almost comatose greens.
According to Rupert.
I have said before that Labor must make themselves the smallest target in the next election, do what it takes, say what it takes. And today in TSP Paul Bongiorno has shown that he also must be delusional or naive according to your ad hominem attack, as you had nothing else.
the kind of strategy Labor is taking to the election: one where it will be willing to match the Coalition on certain policies, in the hope it can differentiate over other key failings.
The simplest explanation for the new position is that Albanese has decided it is time to take the wind out of the government’s sails over Labor’s tax intentions based on the party’s past form. Labor simply could not waste another minute allowing Scott Morrison to distract from his own failures. TSP Paul Bongiorno
“Government backbenchers have no illusions that Labor’s repositioning has made life harder for Morrison in the election campaign. The Albanese announcement has flummoxed senior government ministers.” ..
Yep the strategy I advocated, thanks Bongiorno for validating my opinion. Now hop off RR and have a nap
Allan, you sound like you really think that the ALP would do something meaning if it gained office
Bag the bullsh…and save it for your like minded mates.
Both, Rudd, Gillard and Whitlam are standouts, with Hawke and Keating minor minions, unlike your lot who have no nation building standouts only wrecker and gutless tax haven users. I”ve listed some of the Rudd/Gillard ‘somethings’ they did in office, now for some of Whitlam’s nation building achievements:
1 Ended Conscription,
2. withdrew Australian troops from Vietnam,
3. Implemented Equal Pay for Women,
4. Launched an Inquiry into Education and the Funding of Government and Non-government Schools on a Needs Basis,
5. Established a separate ministry responsible for Aboriginal Affairs,
6. Established the single Department of Defence,
7. Withdrew support for apartheid–South Africa,
8. Granted independence to Papua New Guinea,
9. Abolished Tertiary Education Fees,
10. Established the Tertiary Education Assistance Scheme (TEAS),
11. Increased pensions,
12. Established Medibank,
13. Established controls on Foreign Ownership of Australian resources,
14. Passed the Family Law Act establishing No-Fault Divorce,
15. Passed a series of laws banning Racial and Sexual Discrimination,
16. Extended Maternity Leave and Benefits for Single Mothers,
17. Introduced One-Vote-One-Value to democratize the electoral system,
18. Implemented wide-ranging reforms of the ALP’s organization,
19. Initiated Australia’s first Federal Legislation on Human Rights, the Environment and Heritage,
20. Established the Legal Aid Office,
21. Established the National Film and Television School,
22. Launched construction of National Gallery of Australia,
23. Established the Australian Development Assistance Agency,
24. Reopened the Australian Embassy in Peking after 24 years,
25. Established the Prices Justification Tribunal,
26. Revalued the Australian Dollar,
27. Cut tariffs across the board,
28. Established the Trade Practices Commission,
29. Established the Australian National Parks and Wildlife Service,
30. Established the Law Reform Commission,
31. Established the Australian Film Commission,
32. Established the Australia Council,
33. Established the Australian Heritage Commission,
34. Established the Consumer Affairs Commission,
35. Established the Technical and Further Education Commission,
36. Implemented a national employment and training program,
37. Created Telecom and Australia Post to replace the Postmaster-General’s Department,
38. Devised the Order of Australia Honors System to replace the British Honors system,
39. Abolished appeals to the Privy Council,
40. Changed the National Anthem to ‘Advance Australia Fair’,
41. Instituted Aboriginal Land Rights, and
42. Sewered most of Sydney.
Howard? Paid $300m of our money to the man he sent our ADF to be murdered and maimed by. East Timor bugging devices. Plenty more of your party’s achievements..for their bosses.
Yes, Allan, there is more than one way to skin a cat and I hope that Jim Chalmers is spending free time looking for these.
You now it is disgusting that the Rudd/Gillard achievements are never mentioned, but understandable when you look at them and compare that to Howard, Abbott, Turnbull and ScoMoSin
Achievements of the Rudd-Gillard Government
· NBN (the real one) – total cost $37.4b (Government contribution: $30.4b)
· BER 7,920 schools: 10,475 projects. (completed at less than 3% dissatisfaction rate)
· Gonski – Education funding reform
· NDIS/DisabilityCare
· MRRT & aligned PRRT
· Won seat at the UN
· Signed Kyoto
· Signatory to Bali Process & Regional Framework
· Eradicated WorkChoices
· Established Fair Work Australia
· Established Carbon Pricing/ETS (7% reduction in emissions since July last year)
· Established National Network of Reserves and Parks
· Created world’s largest Marine Park Network
· Introduced Reef Rescue Program
· National Apology
· Sorry to the Stolen Generation
· Increased Superannuation from 9 to 12%
· Changed 85 laws to remove discrimination against same sex couples
· Introduced National Plan to reduce violence against women and children
· Improvements to Sex Discrimination Act
· Introduced Plain packaging
· Legislated Equal pay (social & community workers up to 45% pay increases)
· Legislated Australia’s first Paid parental leave scheme
· Established $10b Renewable energy fund
· Legislated Murray/Darling Basin plan (the first in a hundred years of trying.)
· Increased Education funding by 50%
· Established direct electoral enrollment
· Created 190,000 more University places
· Achieved 1:1 ratio, computers for year 9-12 students
· Established My School
· Established National Curriculum
· Established NAPLAN
· Increased Health funding by 50%
· Legislated Aged care package
· Legislated Mental health package
· Legislated Dental Care package
· Created 90 Headspace sites
· Created Medicare Locals Program
Created Aussie Jobs package
· Created Kick-Start Initiative (apprentices)
· Funded New Car plan (industry support)
· Created Infrastructure Australia
· Established Nation Building Program (350 major projects)
· Doubled Federal Roads budget ($36b) (7,000kms of roads)
· Rebuilding 1/3 of interstate rail freight network
· Committed more to urban passenger rail than any government since Federation
· Developed National Ports Strategy
· Developed National Land Freight Strategy
· Created the nations first ever Aviation White Paper
· Revitalized Australian Shipping
· Reduced transport regulators from 23 to 3 (saving $30b over 20years)
· Introduced NICS – infrastructure schedule
· Australia has moved from 20th in 2007 to 2nd on OECD infrastructure ranking
· Awarded International Infrastructure Minister of the Year (2012 Albanese)
· Awarded International Treasurer of the Year (2011 Swan)
· Introduced Anti-dumping and countervailing system reforms
· Legislated Household Assistance Package
· Introduced School Kids Bonus
· Increased Childcare rebate (to 50%)
· Allocated $6b to Social Housing (20,000 homes)
· Provided $5b to Support for Homelessness
· Established National Rental Affordability Scheme ($4.5b)
· Introduced Closing the Gap
· Supports Act of Recognition for constitutional change
· Provided the highest pension increase in 100 years
· Created 900,000 new jobs
· Established National Jobs Board
· Allocated $9b for skills and training over 5 years
· Established Enterprise Connect (small business)
· Appointed Australia’s first Small Business Commissioner
· Introduced immediate write-off of assets costing less than $6,500 for Sm/Bus
· Introduced $5,000 immediate write-off for Small Business vehicles over $6,500
Introduced Small business $1m loss carryback for tax rebate from previous year
· Legislated Australian Consumer law
· Introduced a national levy to assist Queensland with reconstruction
· Standardized national definition of flood for Insurance purposes.
· Created Tourism 2020
· Completed Australia’s first feasibility study on high speed rail
· Established ESCAS (traceability and accountability in live animal exports)
· Established Royal Commission into Institutional Sexual Abuse
· Established National Crime Prevention Fund
· Lowered personal income taxes (Ave family now pays $3,500 less p.a. than 2007)
· Raised the tax-free threshold from $6,000 to $18,200
· Australia now the richest per capita nation on earth
· First time ever Australia has three triple A credit ratings from all three credit agencies
· Low inflation
· Lowest interest rates in 60 years (Ave mortgagee paying $5,000 less p.a. than 2007)
· Low unemployment
· Lowest debt to GDP in OECD
· Australian dollar is now fifth most traded in the world and IMF Reserve Currency
· One of the world’s best performing economies during and since the GFC
· Australia now highest ranked for low Sovereign Risk
· Overseen the largest fiscal tightening in nations history (4.4%)
· 21 years of continuous economic growth (trend running at around 3%pa)
· 11 years of continuous wages growth exceeding CPI
· Increasing Productivity
· Increasing Consumer Confidence
· Record foreign investment
· Historic levels of Chinese/Australian bilateral relations
· First female Prime Minister
· First female Governor General
· First female Attorney General
Improved social equality and has a larger voice on the world stage.
All this (and more) despite a hung parliament, a recalcitrant press and the most negative and asinine Opposition since Federation.
Yeah, but what did the Romans ever do for us? 😉
And many have been dismantled or in the process to be destroyed under the current government
Vote out the current government. They are a corrupt, bungling rabble.
Impressive achievements, yet so comprehensibly rejected by Australian voters that Labor has to adopt LNP policies to be viable. It would be laughable if it weren’t so tragic as we continue our descent into further mediocrity.
Greed and self interest, the lowest common denominators that unite Coalition voters
It’s a disappointing turn but it feels an inevitable move. The LNP cannot win another term of office. the fact that anything that can’t be explained in simple terms is spun so hard by a receptive media doesn’t help.
A hostile media environment is a significant factor, but not a complete explanation. Labor’s problem is that it is physically incapable, or unwilling, of mounting arguments in the public domain. It should’t be beyond them to develop relatively simple, consistent, progressive positions around issues like housing, climate, and employment. It’s just that they can’t, or won’t. And it’s shockingly naive to think they would risk political capital by announcing major policies on these issues once in Government.
The ‘media environment’ IS the ‘public domain’. It’s been shown time and again that Labor policies will be torn down in the so-called ‘public domain’ while the LNP can get away handsomely with no policies at all. If Labor tried no policies at all, it would be town down regardless; the simple inescapable fact is that double standards and fear tactics defeat Labor every time. The only way that can be overcome, as history shows, is with a media-happy leader who has an over-arching charisma, undeniable ability, and irreproachable probity; the Libs, they can win with corrupt, incompetent fools and nobodies. Labor should be able to ‘develop relatively simple, consistent, progressive positions around issues like housing, climate, and employment’, but the leadership will almost certainly come up short (no Bill pun intended).
Exactly, Cap’n. Labor has won govt from Opposition three times since WW2, by Whitlam, Hawke and Rudd. All three were charismatic and projected authority and confidence. On the other hand, the Coalition can with with middle management drones like Howard and Morrison. Lacking the charisma of his predecessors, Albanese has little choice but to try to appear as a safe pair of hands.
I think this is what’s often lost in the progressive commentary. There’s a desire for charismatic leaders but they’re just not there and the Byzantine nature of political parties mean their chosen person either can’t get in or will have to change to take the top job.
Furthermore, we need a win. I vote as left as I can from the ALP but my belief is I’d rather the ALP than the LNP any day of the week.
Rupert is desperate for Labour’s policy announcements.
The wife of the liberal party’s Campaign Director Brian Loughnane also.
(I do like the ‘hot mike’ admission by Blowhard Paul Murray that the evening’s entertainment is a Liberal Party echo chamber……..well bless ma cotton socks)
I see Labor as the ‘lesser of the two evils.’ Pathetic really but their policies are very similar to Menzies’ back in the day.
On the one hand, the problem is the conservatism of lower-income voters and the incapacity of so many voters to think critically and take a long-term view. The ALP (I am a Greens member) went to the 2019 election with good policies that guaranteed equity over and above continual economic inequity and rampant individualism. The lack of equity can be seen in the way the COVID virus seems most prominent in economically depressed areas, because there people have to work several jobs just to make ends meet, and so risk being in exposure areas.
On the other hand, the complete partisan nature of the main stream media makes it very difficult for the ALP to get across any message that involves any degree of complexity and historical consciousness, either looking forward or backward. Many voters will not know what negative gearing is, let alone franked credits. And whilst a number of critics have been saying that the ALP should be presenting a coherent narrative about Australia’s future, such a narrative will easily go ever the heads of many voters. Most struggle with ideas, especially those which have an economic implication.
One simply needs to look at the alternative images presently made available to them: the television presentation of the Olympic Games. Here we see individual achievement being massively lauded, personal aspiration and a lot of patriotic nonsense, often anchored within a story of personal struggle. Very little here about community responsibility, social and economic inequity, inter-generational fairness. It is all about winning and glamour, which the PM and the mass media understand so well. Unless the ALP can somehow break through this superficiality, the obverse of the insularity defining so many Australians in other areas, its chances of winning the next are questionable.
Indeed. Have an internet point on me.
No one bats an eye — save Crikey, perhaps — when the LNP buy an election. And it’s a prerequisite to exercising power that one must either get elected or have sufficient capital to hold a political party in your pocket. Thus the party must appeal to the electorate they get; toy concepts, compact slogans, a fist full of dollars.
Ironic isn’t it, because individual achievement at Olympic level invariably involves high levels of collective support, co-operation and effort. So even here the individualism is largely mythic. Though in sport, it is not usually transformed into claims of exceptionalism and demands for special treatment and the right to be selfish, some tennis players aside perhaps. Business and the wealthy on the other hand…. well us just being here is a blessing for you, you want we should pay tax as well?
If I was advising Labor on the tax cuts I would have suggested saying, they are legislated so they will go ahead but we think they are unfair and if in the future it is clear that most Australians do as well, we will listen. Thus not taking up their repeal as an election policy but making sure the Coalition continue to own them as another illustration of who the Coalition are there for.
I understand the fear of being wedged, but what is the point of an opposition that offers the same as the party it opposes? It also allows the coalition to frame the debate on its terms. Labor needs to understand that this is major reason it bleeds votes to the Greens in the inner city areas.
How much does bleeding votes in the latte seats matter? Do Greens really preference Liberals?
Bingo. They’ve shored up Cooper and I don’t think the Green’s are in striking distance anywhere else.
The drop looks bad but ultimately, those votes flow back to the ALP.
Exactly !
The greens are the Labour Party’s ‘fed up’ left……..and certainly not into NeoCon moral bankruptcy.
I reckon it’s when Labor bleeds votes from the right side of their supporters, the wheels fall off. It’s rough, but they can afford to tick off the left side to an extent as the prefs come back usually….but voters from the right go off to Clive Palmer, Pauline Hanson et al, and those prefs usually go bye bye.
And Labor need those votes.
LNP and Labor are not the same, if you think that, then you have not been listening. Is the current government interested at all in climate change? Getting involved in creating jobs in alternative energy and at least starting the transition? Are they interested in childcare, social housing? Medicare, NDIS, Age Care etc. I can find a lot of differences. It would not take a lot to be a less corrupted government than the current one. Labor managed the GFC well, despite the contestant attacks by the LNP and the Morduch press. Abbott won the election with one slogan ” Ax the tax”, a slogan that wiped out the small improvements Australia had made to reduce emission. And Morrison had two slogans ” Back in Black” which was a lie and ” I am not Shorten”. I wish we had Shorten instead of Morrison but the voters had allowed them to be brain washed by the Morduch Press. Unfortunately, in this country, you get rewarded for lying and you get destroyed if you tell the truth.
And don’t let us not forget, if Palmer would not have been able to buy all these votes and sell them to the LNP, we would not have had this corrupt, lying incompetent government we currently have. We should ask, how come that a billionaire and an American (Murdoch is American) can decide who wins the election, who governs this country.
Spot on. Those that say Labor and Liberal are the same are completely ignorant
Rupert doesn’t waste his time on the greens……..and that’s the difference.
Labor should not give up these policies, which is why I hope they haven’t. Just pull them out after the election. Say something like “We’ve just discovered that the previous government has rorted all of the money, so we are going to have to introduce new laws”