October 8th 2016

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Articles from this issue:

COVER STORY Reaper mows down first child in the Low Countries

CANBERRA OBSERVED Coalition still gridlocked despite foreign success

EDITORIAL Trump v Clinton: choice between bad and worse

GENERATION RENT The economics behind political unrest

SAME-SEX MARRIAGE Kevin Andrews: defend marriage on principles

WA DRUG POLICY Forum told intervention works with cannabis, ice

OPINION "Deconstruction" fosters contempt of its object

POPULATION POLITICS Philanthropy as a weapon of mass destruction

SUPERANNUATION Take away the number you first thought of ...

HISTORY Germany and its long history of immigration

CINEMA The online madding crowd: Nerve

BOOK REVIEW Tale of forestry dynasty not quite pulp quality

BOOK REVIEW Roman refresher


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Coalition still gridlocked despite foreign success

News Weekly, October 8, 2016

When Malcolm Turnbull wrested the leadership of the Liberal Party and the Prime Ministership from Tony Abbott in September last year he was gifted with enormous goodwill from the electorate to be the Prime Minister to break the cycle of negative politics and the leadership merry-go-round that had plagued Australian politics for close to a decade.

Yet, despite getting some recent runs on the board, a year on Mr Turnbull is still struggling to break free of the same gridlock as Prime Minister as hindered his three predecessors.

Even Mr Turnbull’s success abroad does not seem to translate to success at home, with recent opinion polls showing a plunge to the lowest level of support for the Government yet.

The Prime Minister is clearly comfortable in international forums and with foreign leaders, and his recent trip to Asia and the United States for international summits went off without a hitch.

Scott Morrison has had his lesson in telling
good Treasury cooking from bad.

Admittedly polls at this stage of the electoral cycle are largely irrelevant and the Government’s current unpopularity is more likely to be a sign of people switching off politics altogether rather than a genuine report card on its performance.

Yet the most recent Newspoll, published by The Australian, shows that the Coalition’s primary vote has slumped to 38 per cent, while the two-party preferred vote has Labor enjoying a 52 to 48 per cent lead over the Coalition.

In recent weeks the Turnbull Government has managed to get several problematic issues off the agenda, including its $6.3 billion “omnibus” of budget cuts, its superannuation reform package, and the “backpackers’ tax”. All three measures, for varying reasons, were a headache for the Government, stretching back well into the first year of the Abbott government.

The superannuation measures, in particular, were a problem for the Liberal Party heartland as it hit high wealth individuals and a considerable cohort who were not directly affected but who aspired to be high wealth individuals.

The perception that the higher tax on large super assets was to be taxed retrospectively (regardless of the actuality of the measure) bit during the election, and Treasurer Scott Morrison was reluctantly brought back to the drawing board to design a set of measures that still reined in the tax-free bonanza for wealthy superannuants but which was more reasonable and unambiguously prospective only.

Similarly, the backpackers’ tax affected only a few electorates and rural enterprises that had built business models based on the ready availability of inexpensive foreign labour mainly in the tourism and horticulture industries. But the sudden imposition of the tax, which mirrored similar taxes in other countries, caused unnecessary pain.

But the backpackers’ tax became a lightning rod for divisions between Liberals and Nationals and was fanned by a media that was more interested in the internal rebellion than in the effects of the tax itself.

Both these issues (superannuation and the backpackers’ tax) are now off the table, bringing a welcome reprieve for the Turnbull Government, which has been in a political straitjacket for many months.

Hopefully, Mr Morrison has learnt the lessons of all neophyte treasurers that not everything the Treasury cooks up should be immediately adopted and that it also needs to be carefully screened to be politically and electorally palatable.

More importantly, getting some of these measures through will no doubt be a psychological boost for the Turnbull Government and the Prime Minister, who now have some breathing space to govern in a way that will resonate with the electorate.

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