Latest / Inside Politics / Does a broken promise matter in a broken system, and Angus Taylor’s migrant plan

Transcript

Does a broken promise matter in a broken system, and Angus Taylor’s migrant plan · Inside Politics

• 0:01
  S1: I'm Jacqueline Maley, and you're listening to Inside Politics from
• 0:04
  S1: the Sydney Morning Herald and The Age. This week on
• 0:07
  S1: the podcast, we have so much to talk about and
• 0:09
  S1: it's all very exciting. We're going to dive into the budget,
• 0:12
  S1: which of course was handed down by Treasurer Jim Chalmers
• 0:14
  S1: on Tuesday evening. And later we're going to talk about
• 0:17
  S1: the seismic result at the Farrer by election. Joining me
• 0:20
  S1: from Canberra, we have, as usual, our chief political correspondent
• 0:23
  S1: Paul Circle. Hello, Paul.
• 0:25
  S2: Good morning Jack. How are you?
• 0:27
  S1: Good. How was your budget experience this year?
• 0:30
  S2: I remember watching as we were talking about before the
• 0:33
  S2: podcast Devil Wears Prada two on Sunday night and a
• 0:36
  S2: bit of football in the afternoon. And that's pretty much
• 0:37
  S2: the last thing I can recall. It wasn't just in
• 0:39
  S2: the crazy whirlwind of looking at budget documents and speaking
• 0:43
  S2: to a range of lobbyists and other stakeholders at night
• 0:46
  S2: at pubs. It's a it is a crazy week in Canberra.
• 0:49
  S2: How was yours in Sydney?
• 0:51
  S1: You know, we get locked up, we eat a lot
• 0:53
  S1: of junk food. I mean, in terms of the actual
• 0:56
  S1: budget itself, I've covered, I don't know, more budgets than
• 0:59
  S1: I care to admit. And it was actually quite interesting
• 1:01
  S1: and exciting, even though we had a lot of the
• 1:04
  S1: a lot of the measures were leaked out beforehand, maybe
• 1:07
  S1: even more than previous budgets, but not since the horror
• 1:11
  S1: sort of 2014 budget that Tony Abbott handed down where he,
• 1:14
  S1: you know, cut a lot of services. Has there been
• 1:17
  S1: a budget, in my experience, that has actually sort of
• 1:20
  S1: done so much heavy lifting in where people are really
• 1:22
  S1: having a swing. So that was interesting. As I said,
• 1:25
  S1: a lot of it was leaked out before. Did we
• 1:27
  S1: learn anything new in the budget papers themselves that we
• 1:30
  S1: didn't already know?
• 1:31
  S2: It was an extraordinary amount of leakage, and people in
• 1:34
  S2: the cabinet have been scratching their head as to how
• 1:36
  S2: this has occurred. There's been a sense from people, some
• 1:39
  S2: people have believed that these leaks have been deliberate from
• 1:42
  S2: the treasurer or the Treasurer's office to front run, or
• 1:45
  S2: to get the conservative press onside, because they've been leaked
• 1:48
  S2: to the Australian. That's just untrue. It appears as if
• 1:50
  S2: the source has come straight out of Treasury and who
• 1:52
  S2: knows the motivation. So we knew that the government was
• 1:55
  S2: going to look at capital gains tax discount. We knew
• 1:57
  S2: they were going to look at negative gearing changes. There
• 1:59
  S2: were some questions about how exactly those what the details
• 2:03
  S2: would be around the tweaks. We knew that the government
• 2:06
  S2: was also, again, because of a leak, that the government
• 2:09
  S2: was going to provide a small tax relief through something
• 2:12
  S2: called the Working Australians tax offset. The Watteau or Watteau,
• 2:17
  S2: depending on who you talk to.
• 2:18
  S1: Yeah. I mean, the pronunciation itself is controversial if the
• 2:22
  S1: payment isn't exactly.
• 2:23
  S2: Reminds me of the Australian cricketer and famously bad reviewer
• 2:27
  S2: of uh, when he is being done for L.b.w. Shane Watson,
• 2:32
  S2: who was referred to as Watto. So that's what I
• 2:34
  S2: think of every time I hear this. What we didn't
• 2:36
  S2: know about the Watto is that it's not just a
• 2:39
  S2: one off, it's a permanent feature of the tax structure,
• 2:41
  S2: which will happen at tax time every year. The government
• 2:44
  S2: can scale it up or down, depending on the circumstances,
• 2:47
  S2: and it appears to be a new mechanism Jim Chalmers
• 2:49
  S2: likes is keen to use. Instead of actually tinkering with
• 2:52
  S2: the tax scales or brackets, you can just increase this
• 2:57
  S2: this Watto to target people in certain parts of the
• 2:59
  S2: income bracket. So we didn't learn heaps. That was new.
• 3:02
  S2: But there's there nevertheless is a lot in this budget,
• 3:05
  S2: as you say.
• 3:05
  S1: Yeah. And we got detail around the CGT and the
• 3:08
  S1: negative gearing changes. So negative gearing can still be applied
• 3:11
  S1: to new builds. So obviously that's trying to encourage more
• 3:14
  S1: construction of houses. And the CGT changes will be grandfathered
• 3:19
  S1: as we thought as of June 20th, 2027. And they
• 3:24
  S1: did sort of sneak in this minimum tax rate, which
• 3:27
  S1: we thought was quite interesting when we were looking at
• 3:29
  S1: the budget papers. They're going to have a minimum tax
• 3:31
  S1: rate of 30%. So you can't basically fandangle your affairs
• 3:35
  S1: so that you're paying a really, really low marginal tax
• 3:38
  S1: rate on your capital gains of that year. They've basically
• 3:42
  S1: pitched at 30%, which is about what most people, most
• 3:44
  S1: working people pay around the middle, middle tax income bracket.
• 3:49
  S1: So I thought that was interesting. I also I want
• 3:52
  S1: to get your take on this. The budget was framed
• 3:55
  S1: very intentionally by the government as an intergenerational equity argument
• 3:59
  S1: for younger people who are locked out of home ownership
• 4:01
  S1: in particular, and who are much less likely to take
• 4:04
  S1: advantage of the tax breaks of CGT discount and negative gearing.
• 4:08
  S1: But actually, I feel like they snuck another agenda in there,
• 4:11
  S1: which was gearing the tax system away from accumulated wealth
• 4:15
  S1: and asset people with assets and towards people who work
• 4:19
  S1: for a living, like you and I, the wage slaves.
• 4:23
  S1: What do you think about that?
• 4:25
  S2: Well, you don't know about my personal life.
• 4:26
  S1: That's true, I don't. I don't know about the complex
• 4:29
  S1: tax structures or trust structures under which you manage your
• 4:32
  S1: enormous wealth, but I'm assuming it's a well.
• 4:34
  S2: It's a real web.
• 4:35
  S1: There's Cayman Islands, you know, havens involved. Yeah. No, I'm
• 4:39
  S1: assuming that you're a salaried, um, a salaried person such as.
• 4:43
  S2: Yeah. It's a good assumption. Um, yeah. So you're right.
• 4:47
  S2: This budget was pitched as a big moment where a
• 4:51
  S2: progressive government wanted to address a long term trend towards
• 4:56
  S2: that has seen the taxation of assets and wealth taxed
• 4:59
  S2: at a lower rate than labor income. And so many
• 5:03
  S2: economists in Australia have argued for a long time that
• 5:05
  S2: the tax system penalises young people. Personal income tax scales
• 5:08
  S2: are pretty onerous compared to many other countries. The higher
• 5:11
  S2: tax rates kick in at relatively low income levels and
• 5:15
  S2: the rates are pretty high as well. Paul Keating agrees
• 5:17
  S2: with this. Bill Keelty, the labor luminary, agrees with this,
• 5:20
  S2: and many older people have been able to offset rental
• 5:23
  S2: income losses and and use trusts to split income and
• 5:27
  S2: get really big capital gains benefits from selling houses that
• 5:30
  S2: have been propped up by housing bubbles over years. So
• 5:34
  S2: all of those tax concessions have been reined in. And
• 5:36
  S2: so the government argues that over time, this will lead
• 5:39
  S2: to more people at auctions who are younger, being able
• 5:43
  S2: to buy a house at a decent price because they
• 5:45
  S2: won't be outbid by an investor. They say that over
• 5:49
  S2: the next ten years, 75,000 new first home buyers who
• 5:52
  S2: wouldn't have previously existed will come into the system. That
• 5:56
  S2: sounds like a lot, but the overall rate of home ownership,
• 5:59
  S2: the government believes, will increase from about 66% of Australians
• 6:03
  S2: to about 67%, so it's hard to create huge change.
• 6:06
  S2: They also estimate that the price growth of houses will
• 6:11
  S2: be about two percentage points lower every year after these
• 6:14
  S2: changes kick in. So if house prices were going to
• 6:16
  S2: grow by 8% next year, they reckon they might grow
• 6:19
  S2: by about six. There were some estimates in our paper
• 6:21
  S2: that could actually be more significant than that. And so overall,
• 6:24
  S2: the whole political pitch of this budget is young people
• 6:26
  S2: are having a crap time. And so these generous concessions
• 6:30
  S2: that have existed for older Australians, largely older Australians, but
• 6:32
  S2: also lots of 30 people in their 30s and 40s
• 6:35
  S2: will be struck out. The counter-argument that you'll see the
• 6:38
  S2: Liberal Party lean into very heavily in coming weeks is
• 6:42
  S2: that by grandfathering these changes, particularly for negative gearing, you
• 6:46
  S2: lock in the advantage that older people have had. They've
• 6:49
  S2: also had inflated house prices, that the gains that have
• 6:52
  S2: already come into those assets. And because of the transitional
• 6:57
  S2: arrangements around capital gains tax, they'll still largely be able
• 7:00
  S2: to sell that property and get a huge gain from it.
• 7:03
  S2: So the big backlash will come from the Liberal Party
• 7:06
  S2: to say, you're locking out a whole generation of young
• 7:09
  S2: people who wanted to take advantage of these arrangements and
• 7:12
  S2: become wealthy, and you've entrenched the advantage that older people have.
• 7:15
  S1: Yeah. So that's what I wanted to get to next because,
• 7:18
  S1: I mean, there's been so much coverage of the budget measures,
• 7:20
  S1: and we don't want to do that in detail on
• 7:22
  S1: this podcast. But I do want to talk about how
• 7:25
  S1: these measures and the framing of the budget might land.
• 7:27
  S1: So already we have a sense of what the opposition
• 7:30
  S1: response has been so far. I should say that we're
• 7:32
  S1: recording this before we get the formal budget reply speech
• 7:35
  S1: from Angus Taylor on Thursday night. But we know already
• 7:39
  S1: that Angus Taylor, you know, the coalition is going to
• 7:41
  S1: oppose the tax changes they're going to go along with.
• 7:45
  S1: They'll support the there's infrastructure money, infrastructure money for construction
• 7:50
  S1: of houses, basically. So they're going to support that. What
• 7:52
  S1: else do we know about how the coalition's responding to
• 7:56
  S1: the budget?
• 7:58
  S2: Yeah. Listeners might remember maybe 6 or 8 weeks ago,
• 8:02
  S2: Andrew Hastie, who's seen as a leadership alternative to Angus Taylor,
• 8:06
  S2: was considering running a few months ago when on insiders
• 8:09
  S2: on the ABC. And when asked about some of these
• 8:11
  S2: property tax concessions and attacks on big gas firms, said
• 8:15
  S2: to David Speers, the host, we need to be open
• 8:18
  S2: minded about these things.
• 8:19
  S3: I'm no one's going to reward us for a final,
• 8:21
  S3: last stand for neo liberal politics. Okay. Um, there's no
• 8:26
  S3: medal for that.
• 8:27
  S2: Effectively, what he was saying was that the boomer class
• 8:30
  S2: that has made most of the the money out of
• 8:33
  S2: the big housing bubbles of recent decades are our constituency.
• 8:37
  S2: But we need to grow. And so maybe we should
• 8:39
  S2: have a think about rebalancing the housing market. That argument
• 8:42
  S2: has not had much of a look in since labor
• 8:46
  S2: actually revealed what they were doing. What you've seen is
• 8:49
  S2: a Liberal Party revert to their natural instincts around aspiration
• 8:53
  S2: and lower taxes, and I don't blame them for that,
• 8:55
  S2: by the way. There's probably not that much room for
• 8:57
  S2: nuance in this debate. When the government brings forward $100
• 9:00
  S2: billion in tax hikes on people who have made wealth
• 9:04
  S2: over the next ten years. You're the Liberal Party. You
• 9:07
  S2: believe in lower taxes. The government didn't take these measures
• 9:09
  S2: to the last election. I think they were left with
• 9:11
  S2: very little opportunity, really, to do anything but oppose. They
• 9:14
  S2: haven't actually fully committed to repealing these changes. If they
• 9:17
  S2: win the next election, they have said they'll fight them hard.
• 9:20
  S2: And I think you'll see a new energy into the
• 9:22
  S2: Liberal Party, a kind of renewed purpose around what the
• 9:25
  S2: party stands for, which is lower taxes and aspiration. If
• 9:28
  S2: the party's been confused about that in recent years. This
• 9:31
  S2: moment clarifies that. But there is still a question about
• 9:34
  S2: in a few years, if they go to an election,
• 9:35
  S2: do they actually commit to repealing them? Because that causes
• 9:38
  S2: a huge budget black hole for them?
• 9:40
  S1: Yeah, I know. I mean, Tim Wilson has been questioned
• 9:42
  S1: about this. I thought he was sort of saying that
• 9:44
  S1: they would repeal them, but maybe we can check in
• 9:46
  S1: on that next week as well, because I'm sure we'll
• 9:48
  S1: still be talking about it and see if.
• 9:50
  S2: If we have to, we will. They're using Caveated.
• 9:52
  S1: Language. So it'll be interesting because journalists will push them
• 9:56
  S1: and we'll try to we'll try to get a response
• 9:57
  S1: from that on that. There's two sort of tranches, I suppose,
• 10:00
  S1: or two elements to their attack on labour. One is
• 10:04
  S1: the broken promises line. So obviously Anthony Albanese has been
• 10:08
  S1: loath to call his commitment or his statement, as I
• 10:11
  S1: think he said, that there would be no changes along
• 10:14
  S1: the lines of the ones they've just introduced. He said
• 10:17
  S1: that during the election campaign, he's been loath to call
• 10:20
  S1: it a promise and therefore a broken promise. Obviously, it's
• 10:22
  S1: been framed already by the opposition as a broken promise
• 10:25
  S1: and even a lie to the electorate. Do you think
• 10:28
  S1: that that will gain much traction given, you know, if
• 10:32
  S1: these changes turn out to be broadly supported by the public?
• 10:35
  S2: Mhm. Well, the government's banking on the public reaction being
• 10:39
  S2: similar to the one that occurred when it rejigged the
• 10:42
  S2: stage three tax cuts in the middle of the last term.
• 10:45
  S2: The difference here is that the stage three tax cuts
• 10:47
  S2: allowed all Australians to still get some benefit from that
• 10:51
  S2: tax rejig. All Australians still received a tax cut, but
• 10:54
  S2: they became less generous at the top end, and they
• 10:56
  S2: became more generous for middle and lower income earners. So
• 10:59
  S2: there weren't many losers out of that this time. There
• 11:02
  S2: is a bunch of people who will feel like they
• 11:05
  S2: wanted to invest and now can't. And people who are
• 11:08
  S2: already investors, except if they're in the grandfathered part of
• 11:12
  S2: the equation, will feel like this is an attack on
• 11:15
  S2: their wealth. The government hopes and thinks that there's a
• 11:19
  S2: bigger part of the electorate who don't believe they have
• 11:22
  S2: any access to asset wealth, who never who don't intend
• 11:27
  S2: to become investors because they're just trying to get their
• 11:29
  S2: foot in the door and that those people will reward
• 11:31
  S2: the government. So there's this cleavage that occurs out of
• 11:35
  S2: this policy, where aspirational Australians who are not tied to
• 11:40
  S2: labor on progressive social values, you might see some of
• 11:43
  S2: those voters in the middle drift back towards the coalition.
• 11:46
  S2: But labor believes the numbers suit them here, and that
• 11:49
  S2: most Australians think that the system is broken, and a
• 11:52
  S2: big change like this won't hurt them. On the language
• 11:55
  S2: the The government said before the budget that if they
• 11:58
  S2: were to change their mind, as we all reported, they
• 12:01
  S2: were going to, you'd hear an explanation from them after
• 12:04
  S2: the budget on why they did so, and they would
• 12:06
  S2: be upfront with the Australian people about the reason for
• 12:09
  S2: the change in decision on budget night and in the
• 12:12
  S2: day after. There wasn't that much new language on why
• 12:15
  S2: this move was necessary. They were making the same arguments
• 12:18
  S2: before the budget really as after, which was that the
• 12:21
  S2: system is broken. We need major change, and a big
• 12:25
  S2: rejig of the system was required because most Australians feel dislocated.
• 12:30
  S2: Albanese and Chalmers have acknowledged that their changes are controversial,
• 12:35
  S2: but when asked about the broken promise or as you say,
• 12:38
  S2: the lie, they've not used that language, not acknowledged the
• 12:41
  S2: legitimacy of that kind of language, and instead have reverted
• 12:45
  S2: to this much more bland line around a change in
• 12:49
  S2: decision or a change in mind. We've come to a
• 12:51
  S2: different view. So they're not. Then they have said that
• 12:54
  S2: they'd be up front, but they're not in a, you know,
• 12:58
  S2: you know, full way acknowledging what they've done here.
• 13:01
  S1: No. Well, I think that I mean, not having any
• 13:04
  S1: special insight into it, but I just I just keep
• 13:06
  S1: thinking back to the, the broken promise, the liar charge
• 13:10
  S1: that was levelled against Julia Gillard when she introduced the
• 13:12
  S1: carbon tax, which, you know, I guess some people were
• 13:17
  S1: hurt by it. But overall, anyway, putting aside the merits
• 13:20
  S1: of the actual policy, it was allowed to be framed
• 13:22
  S1: as a lie and as a broken promise. And I
• 13:25
  S1: think that they're probably they've learned a very harsh lesson
• 13:27
  S1: from that. And they're like, whatever the actual objective truth
• 13:30
  S1: of the situation, we're not going to call it that.
• 13:32
  S1: So we're not going to let we're not going to
• 13:34
  S1: sort of play along with that narrative.
• 13:36
  S2: So and, and I won't say on, on at any
• 13:39
  S2: with a camera in front of me at any point that, yes,
• 13:41
  S2: we did break a promise because that becomes an election
• 13:43
  S2: ad for the Liberal Party.
• 13:44
  S1: Yeah. I'm just not going to give them that line.
• 13:45
  S1: And then I'm going to focus on the merits of
• 13:47
  S1: the policy itself. So I want to talk briefly about
• 13:50
  S1: the economic settings that were in the budget because, you know, very,
• 13:54
  S1: very high up in budget paper one under the economic setting,
• 13:57
  S1: sort of, um, heading. They talk about the different scenarios
• 14:01
  S1: and how the Iran war, whether or not it ends
• 14:03
  S1: soon or not, soon has the capacity to blow out
• 14:06
  S1: of the water. All of the projections that the government
• 14:09
  S1: has like spent, you know, sort of the next 100
• 14:12
  S1: hundreds of pages detailing on one scenario. They they said
• 14:15
  S1: that if, you know, Treasury has modelled that if crude
• 14:18
  S1: oil reaches $200 a barrel, which a lot of economists and,
• 14:21
  S1: and commentators say is highly possible, inflation will spike up
• 14:24
  S1: over 7%, unemployment goes up to 5%. Productivity growth as
• 14:28
  S1: well is very sluggish on the government's own figures. So
• 14:31
  S1: productivity growth, we know, is a huge sort of drag
• 14:34
  S1: on the economy or low productivity growth. And the government
• 14:37
  S1: itself is saying it's only going to be about one 1.5%
• 14:40
  S1: per annum, which is pretty low. And GDP growth is
• 14:44
  S1: not is not that great either, 1.75% this coming year, 2.25%
• 14:50
  S1: the following year. So I guess a lot of people
• 14:53
  S1: have pointed out as well that there's $1 trillion debt
• 14:55
  S1: like gross debt in next year's projections. The interest on
• 15:00
  S1: that debt is the second biggest impost on the budget,
• 15:03
  S1: I think, after the NDIS. So the broader picture here
• 15:06
  S1: is that the government maybe has not done a lot
• 15:09
  S1: to address the deficits and the interest bill that future
• 15:12
  S1: generations will have to carry is huge. How much is
• 15:16
  S1: the coalition going to sort of talk about that, as
• 15:18
  S1: well as the actual sort of tax cut policy?
• 15:21
  S2: Well, that's I think you've gone to the nub of
• 15:24
  S2: what the coalition's argument will be. Angus Taylor, when he
• 15:27
  S2: was shadow treasurer at the last election, put forward this
• 15:29
  S2: policy under the Dutton administration to index tax brackets. So
• 15:33
  S2: that would mean that every year. So the bracket creep
• 15:36
  S2: is not as severe. Bracket creep is when you push
• 15:38
  S2: up just through wage rises into higher tax brackets. Those
• 15:42
  S2: brackets would go up every year in line with either
• 15:45
  S2: inflation or wage growth. So people are not just artificially
• 15:48
  S2: paying more tax over time. Australians pay much more income
• 15:51
  S2: tax now than they did in previous years, and the
• 15:54
  S2: budget shows that the reliance on income tax from wage
• 15:57
  S2: earners will just continue to grow over time, unless there's
• 16:00
  S2: substantial change in the way we tax labour income. So
• 16:05
  S2: the coalition will say that the government's changes artificially, you know, through,
• 16:10
  S2: they would say, virtue signalling signal to younger voters that
• 16:13
  S2: the government's on their side. But in the long run,
• 16:16
  S2: because of our high tax, high spend economic model, that
• 16:22
  S2: government outlays will inevitably be funded by higher taxes on
• 16:26
  S2: wage earners because there's no other option. So on Thursday night,
• 16:29
  S2: you'll see Angus Taylor say that the coalition wants to
• 16:32
  S2: do something substantial to reward work, to incentivise aspiration and
• 16:37
  S2: make a structural change to the way we tax labor income.
• 16:40
  S1: Yeah. And we should say as well that Jim Chalmers
• 16:42
  S1: has sort of left open the possibility of extending the
• 16:45
  S1: Watto or the Watto, that $250 tax back for earners
• 16:49
  S1: or cash back, I should say, for income earners. So
• 16:52
  S1: both parties are looking at doing something on income tax
• 16:55
  S1: or for wage slaves by the next election. The government
• 16:59
  S1: and Jim Chalmers didn't mention immigration at all in the budget.
• 17:02
  S1: It just didn't come up. But Angus Taylor will make
• 17:04
  S1: it a central part of his budget reply speech. We
• 17:06
  S1: know that. And he's going to explicitly link immigration to housing.
• 17:10
  S1: So you've written about that this week that basically he's
• 17:12
  S1: going to say the immigration tax should should exactly match
• 17:15
  S1: the number of houses built, which is slightly illogical because,
• 17:19
  S1: you know, more than one person lives in one house,
• 17:22
  S1: generally speaking. I just want to I want to get
• 17:24
  S1: your reflection, I suppose, on the immigration part of the budget,
• 17:27
  S1: the budget reply, they they keep talking about mass migration.
• 17:31
  S1: We also saw a story this week that they're going
• 17:33
  S1: to say that people who are non-citizens shouldn't be able
• 17:37
  S1: to access any welfare benefits. How do you think those
• 17:41
  S1: immigration lines are going to land?
• 17:44
  S2: I think they're more examples of the step change in
• 17:49
  S2: the immigration debate in Australia, just in a short period
• 17:52
  S2: of time After the last election. Andrew Bragg, who's the
• 17:55
  S2: housing spokesman and a moderate Liberal senator from New South Wales,
• 17:59
  S2: said that one of the lessons out of the Dutton
• 18:01
  S2: administration was that the Liberal Party shouldn't be. I think
• 18:04
  S2: his language was shouldn't be blaming migrants for things like
• 18:06
  S2: the housing crisis. So he was uncomfortable at that time
• 18:10
  S2: with directly linking the housing shortage to our really quite
• 18:14
  S2: high levels of migration compared to the OECD, which is
• 18:17
  S2: not untrue. To point out, Australia does have very high
• 18:20
  S2: levels of migration over the last 20 years, not just
• 18:22
  S2: in recent years, but as one nation has risen, as
• 18:27
  S2: the right faction within the Liberal Party has increasingly influenced
• 18:30
  S2: its policy making process, particularly since the leadership change from
• 18:35
  S2: Sussan Ley. You've seen the party become much more comfortable
• 18:39
  S2: elevating the issue of migration, as Pauline Hanson does. You're
• 18:43
  S2: seeing policy making processes look to parts of Europe. Countries
• 18:47
  S2: like Sweden, Denmark, Britain, in some respects are more openly
• 18:51
  S2: talking about making the housing and citizenship process more difficult
• 18:58
  S2: for new arrivals to make it that, you know, a
• 19:01
  S2: person needs to take longer to go from permanent residency
• 19:04
  S2: to citizenship to gain get access into benefits schemes, to
• 19:09
  S2: crack down on the numbers of migration. And so you're
• 19:12
  S2: seeing that become much more front and center in the
• 19:15
  S2: coalition's language and agenda.
• 19:17
  S1: Yeah. Okay. Speaking of immigration and relatedly, the advance of
• 19:22
  S1: One Nation, we have to just check in on Fara, which,
• 19:25
  S1: as we know, happened last weekend, although it seems like
• 19:27
  S1: it was a really long time ago. It was a
• 19:29
  S1: resounding result. It happened really quickly. David Farley, the One
• 19:32
  S1: Nation candidate member elect, got 57.6% of the two party
• 19:37
  S1: preferred vote. And then the runner up, the community independent
• 19:40
  S1: Michelle Milthorpe, got 42.4%. So neither the nationals nor the
• 19:45
  S1: Liberals were even in the top two. They just weren't
• 19:48
  S1: really in the race. How bad is this for the
• 19:50
  S1: Liberal Party and for the coalition more broadly. I mean,
• 19:53
  S1: how was it received within Liberal Party ranks?
• 19:55
  S2: It was a pretty shocking night and a and a
• 19:58
  S2: real blow to the morale of people in and around
• 20:01
  S2: the coalition. Angus Taylor always knew he was going to
• 20:04
  S2: lose this election. When Susan Lee quit, it was a
• 20:06
  S2: horrendous time for the party polling at record lows, but nevertheless,
• 20:10
  S2: the Liberal Party believed it would poll somewhere around the
• 20:12
  S2: 17 to 18% region. They ended up around 12 or 13%,
• 20:16
  S2: and the National Party didn't break into double digits. So
• 20:21
  S2: tallied together, they weren't even as high as the independent
• 20:25
  S2: who came in second place. The pictures from the night,
• 20:28
  S2: I'm not sure if you were watching Jack were pretty
• 20:30
  S2: stark as well. The the Liberal Party event was in
• 20:32
  S2: this big community hall. There were about 25 people huddled
• 20:36
  S2: around the speaker and the One Nation event, which was
• 20:38
  S2: at a pub just down the road, was so full
• 20:41
  S2: of energy. They were chanting Aussie, Aussie, Aussie and playing
• 20:44
  S2: pub rock and it felt like a bit of a moment.
• 20:46
  S2: Barnaby Joyce, who I was told wasn't drinking on the night,
• 20:50
  S2: was just looked like a man who was full of
• 20:53
  S2: energy and joy and was like a rock concert. So
• 20:57
  S2: it did. It was is the first moment on the
• 20:59
  S2: national stage where one nation was able to say, hey,
• 21:02
  S2: this is real. We're on here. Because the South Australian
• 21:05
  S2: election result was just that, a state election result. They're
• 21:08
  S2: also just to counter that there were people in the
• 21:11
  S2: Liberal Party are quite sober about their situation. They knew
• 21:14
  S2: they'd go poorly. They're under no illusions about how difficult
• 21:17
  S2: the path back will be. But it was just a
• 21:20
  S2: moment that made people realise, wow, we actually need to
• 21:23
  S2: start from scratch here, build up a really bold policy agenda.
• 21:26
  S2: Act like a startup and be agile and move in
• 21:29
  S2: directions that people don't expect. Which I think is why
• 21:32
  S2: Angus Taylor will announce a fair bit of policy on
• 21:34
  S2: Thursday night in his budget reply.
• 21:36
  S1: Yeah, well, at least his budget reply has the ability
• 21:38
  S1: to take take the shine off that fairer result. Cos
• 21:42
  S1: I was listening to the other day, he's a former
• 21:44
  S1: labor pollster who now runs, I think, and owns Redbridge Polling.
• 21:48
  S1: He was talking about a scenario in which labor basically
• 21:51
  S1: kind of owns the young metropolitan voter through, you know,
• 21:56
  S1: policies like they've announced in the budget. And then the
• 21:59
  S1: regional voters become the basically owned by one Nation. So
• 22:03
  S1: the coalition falls away and one nation rises very much
• 22:07
  S1: in the regions. The counter to that is Barnaby Joyce
• 22:10
  S1: and other people saying that actually they're going to come
• 22:13
  S1: for labor seats. So Barnaby Joyce, after that result in
• 22:17
  S1: very explicitly said, we're coming for Western Sydney, and there
• 22:19
  S1: could be some seats that they could pick off there potentially,
• 22:22
  S1: or they could have a run in. What's your feeling
• 22:24
  S1: on that? How worried should labor be about them coming
• 22:27
  S1: at some of maybe those outer urban or suburban seats?
• 22:31
  S2: Well, I mean, the lesson from the UK is that
• 22:34
  S2: the populist right can eat into a weakened centre left party.
• 22:37
  S2: Starmer is, um, looks like he might force the end
• 22:40
  S2: of Keir Starmer's prime ministership over there. And that's that's
• 22:43
  S2: occurred in different parts and in different elections across the Anglosphere.
• 22:48
  S2: Anthony Albanese has succeeded in keeping Labor's vote in coalition
• 22:53
  S2: pretty wide. As you say, labor dominates and the coalition
• 22:57
  S2: has suffered horrendous losses, not just in the teal seats,
• 23:00
  S2: which we talk about a lot, but middle suburbia. They've
• 23:03
  S2: been pushed into really almost unwinnable positions in a bunch
• 23:07
  S2: of seats where they previously had really healthy margins across
• 23:10
  S2: the middle suburbs of Melbourne, Sydney, Adelaide, Perth. The only
• 23:14
  S2: place they still hold those middle and outer suburban seats
• 23:17
  S2: in significant numbers is Brisbane, where the LNP brand is strong,
• 23:21
  S2: and that's off the back of younger voters. That's off
• 23:24
  S2: the back of new migrants who are in the workforce,
• 23:27
  S2: and second generation migrants in the workforce who don't necessarily
• 23:31
  S2: share Labor's progressive social values, but see labor as modern,
• 23:35
  S2: in touch with their material concerns and putting forward a
• 23:40
  S2: brand of governing that is inoffensive and stable. Whereas the
• 23:45
  S2: coalition has been, you know, not talking about the issues
• 23:49
  S2: that people in the suburbs on child care, cost of
• 23:52
  S2: living that resonate in recent years. So the One Nation
• 23:57
  S2: threat will be significant to labor in some of its
• 24:00
  S2: outer suburban seats. We don't know how one nation will
• 24:03
  S2: go at a federal election yet. So, so much yet
• 24:05
  S2: to be tested. But at some of these in some
• 24:08
  S2: of these labor seats in the outer suburbs of Melbourne
• 24:10
  S2: and Sydney, there already is a combined far right Christian
• 24:14
  S2: party vote of up to 10% in some of these
• 24:17
  S2: seats through various Micro-parties. One nation will hoover that up
• 24:21
  S2: if they hoover up maybe half of the Liberal Party
• 24:23
  S2: vote in these areas, they could be a threat. But yeah,
• 24:26
  S2: and it's something labor is alive to.
• 24:28
  S1: In Sydney and in Melbourne to I think a lot
• 24:30
  S1: of those outer open seats or fringe seats have high
• 24:33
  S1: migrant populations as well. And who knows how that might
• 24:36
  S1: play with a one nation candidate, depending on how they
• 24:39
  S1: present themselves. Pauline Hanson is now saying she's not anti-immigration,
• 24:42
  S1: she's anti-mass migration, whatever that means. So the government's budget,
• 24:48
  S1: the budget is basically an opportunity for the coalition to
• 24:50
  S1: get some air time, as you say, to retreat to
• 24:53
  S1: that very safe place for the Liberal Party, which is
• 24:56
  S1: defending tax policy and being the party of lower taxes always,
• 25:00
  S1: and the party of aspiration. So a lot is riding
• 25:02
  S1: on the budget response for Angus Taylor, even though I
• 25:05
  S1: would say not a lot of people in the general
• 25:08
  S1: community kind of take that much notice of it. If
• 25:11
  S1: he doesn't do well or if the criticisms on labor
• 25:14
  S1: don't land, will Angus Taylor's leadership be in peril, do
• 25:17
  S1: you think?
• 25:19
  S2: Well, the basis for Angus Taylor's leadership was outlined on
• 25:21
  S2: the morning of the leadership spill by his key ally,
• 25:24
  S2: James Patterson, the senator. And his quote was, if we
• 25:27
  S2: don't change, we'll die. And the number of people who
• 25:30
  S2: have been flocking away from the Liberal Party meant that
• 25:32
  S2: it was in an existential crisis and had to reconnect
• 25:34
  S2: with its base. Angus Taylor has stopped the rot. Their
• 25:37
  S2: polling numbers haven't continued to decrease. He's pushed up the
• 25:41
  S2: primary vote a few percentage points. They're in the low
• 25:44
  S2: 20s in a bunch of different polls now pushing up
• 25:47
  S2: into the mid 20s. But One nation seems entrenched in
• 25:50
  S2: that mid 20s primary vote. Higher 20s in some polls.
• 25:54
  S2: And that's not a tenable, tenable position for the Liberal
• 25:56
  S2: Party getting closer to the election. There'll be a Victorian
• 25:59
  S2: election in November where Jess Wilson, the opposition leader, will
• 26:03
  S2: be trying to get on top of quite a tired
• 26:05
  S2: labor government down there. And I think that will be
• 26:07
  S2: symbolic as to where the Liberal Party is at across
• 26:09
  S2: the country. They'll then be a New South Wales election
• 26:13
  S2: at the first part of next year in March, I believe.
• 26:16
  S2: And if the Liberal Party is polling at its same
• 26:18
  S2: level federally now as it is then, one Nation looks
• 26:21
  S2: dominant and the Liberals aren't winning at a state level. Inevitably,
• 26:26
  S2: questions will start to be asked about whether Angus Taylor
• 26:28
  S2: has enough energy and is eye catching enough to take
• 26:31
  S2: the party forward. He hasn't achieved much cut through yet,
• 26:34
  S2: but there is a broad sense across both moderate and
• 26:37
  S2: right faction parts of the federal parliamentary party that he
• 26:40
  S2: deserves a chance, that he's trying to bring stability and
• 26:43
  S2: unity to the show, that he's had an okay but
• 26:46
  S2: not hugely inspiring start, and that time is needed.
• 26:49
  S1: Yeah. So they're giving him clear air at least, which
• 26:52
  S1: is more than his predecessor got. Paul, that's been a
• 26:55
  S1: fascinating chat, as always. And next week, I think we're
• 26:58
  S1: going to have former opposition leader Bill shorten on. And
• 27:00
  S1: hopefully we'll have a bit more sense of how the
• 27:03
  S1: government is selling its budget and how successful the coalition
• 27:06
  S1: is able to be in attacking the budget, basically, and
• 27:09
  S1: all the measures. So have fun. Until then, stay cool
• 27:13
  S1: and I'll see you next week.
• 27:14
  S2: See you next week.
• 27:19
  S1: You can read all of our political news on our website,
• 27:22
  S1: si.com.au and smh.com.au. Today's episode was produced by Kai Wong
• 27:27
  S1: with help from Debbie Harrington. Our executive producer is Tammy Mills,
• 27:31
  S1: and our podcasts are overseen by Lisa Muxworthy and Tom McKendrick.
• 27:35
  S1: Before you go, please follow Inside Politics and leave a
• 27:38
  S1: review for us on Apple or Spotify. I'm Jacqueline Maley,
• 27:41
  S1: thank you for listening.