Who’s The Radical Here?
By Mike SeccombeApril 18, 2012
It’s not who you think it is, says Greens leader Christine Milne as she explains her party’s economic positions.
Here's a turn up for the books: the Greens are now attacking mainstream politics not from the left but from the centre.
Who would ever have expected to hear them backing their economic policy by reference to that traditional bête noir of the political left, the International Monetary Fund?
But there was the party's new leader, Christine Milne, on the ABC's 7.30 program the third day after her elevation to the leadership, doing just that as she continued her criticism of the Labor Government for its maniacal (and I use the word advisedly) pursuit of a surplus in next month's federal Budget.
"Taking $40 billion out in one year is a huge amount. It's a record amount. And it's contrary to what most leading economists are saying. And also, Christine Lagarde from the IMF this week was encouraging developed economies like ours to be a bit more flexible to make sure that we don't see contraction in critical parts of the economy," said Milne to her interviewer, Chris Uhlmann.
Now, as for the word "maniacal", Milne did not use it. Her articulation of the Greens position was very restrained. The person who called the push for a surplus "maniacal" was one of the nation's most respected economists, Saul Eslake. He is currently chief economist with Bank of America Merrill Lynch Australia, although at the time he said it — on August 12, 2011 — he was director of the highly respectable, centrist Grattan Institute.
His words appear on a list of similar quotes prepared some weeks back by Greens staffers for former leader Bob Brown, and now for Milne's use.
For the record, the full Eslake quote, culled from a piece he wrote for The Conversation, is this:
"But there has always been something bordering on the maniacal about the Government's insistence that the Budget must return to surplus, come hell or (as seen in the aftermath of the Queensland floods) high water, by the 2012-13 financial year."
There are a dozen people featured in the Greens's quotes collection, some of them leftish but most of them not, and all of them heavy economic hitters — including AMP chief economist Shane Oliver, HSBC's Paul Bloxham, Société Générale's Christian Carillo, BIS Shrapnel's Richard Robinson, et cetera. The list even includes a quote from David Uren, who writes economics for the other traditional bête noir of the left in this country, The Australian newspaper.
And all of them echo Milne's view.
Alas, she did not get the chance to cite anyone from that list on 7.30, for Uhlmann's follow up question went to Christine Lagarde and the fact that she had "forced the Greeks to have 150,000 public service jobs cut, to have a 22 per cent cut in the minimum wage and to cut pensions and that's what happens when governments let their houses get out of order so surely now is a good time for Australia to get its house in order."
Milne swatted him down.
"Well, I don't think anyone would suggest that the Australian economy is anything like the chaos that exists in the Greek economy," she said.
She proceeded to reinforce the point that "the return to surplus is a political promise from the Labor Party rather than an economic imperative.
"And from the Greens point of view, we want to make sure that there is not a contraction that makes the jobs market even weaker," she said.
It was a neat reversal of the normal order of politics, in which the others accuse the Greens of being fiscally irresponsible, in which they are attacked as job-destroyers.
You can check out the 7.30 interview here.
What has made Milne's performances in her first few days as leader interesting are the issues she has stressed — issues around what is always the main game of Australian politics, the economy. And she is keeping a tight focus on just a few areas in which the Greens's position (a) has support from surprising quarters (b) divides the major parties, and/or (c) suggests the major parties lack the courage of their convictions.
Let's give an example or two of each from the short list of immediate priorities she enumerated when she spoke to The Global Mail the day after her 7.30 performance, day four of her leadership.
One was the need for a $50 per week increase in the dole. (She did not enumerate the detail, but the call, which matches the demands of the Australian Council of Social Service, includes several other benefits which also are now paid at below poverty rate levels.)
The Greens/ACOSS argue that people cannot enjoy a reasonable quality of life on $35 a day, or $17 a day once their rent is taken out.
A fringe left issue? Not unless you consider Heather Ridout, who was until recently, when she moved onto the Reserve Bank of Australia board, the chief executive of the Australian Industry Group, a leftie. And Jennifer Westacott, chief executive of the Business Council of Australia. Why, the idea even has support among The Australian's stable of right-wing commentators; its contributing economics editor Judith Sloan, supports an increase.
This is not just an example of the 'support from surprising quarters' criterion; it also is an uncomfortable one for the Labor Government, a substantial number of whose members also want the dole increase. It's an issue that allows the Greens to claim they have usurped Labor's traditional position as the party of social justice.
A second enumerated issue was the implementation of the Gonski Report into schools funding, which was commissioned by the Labor government and which recommended a new model of funding at a cost of some $5 billion, only to be put onto the back burner by the government.
Once again, it's an uncomfortable one for Labor, which seems to lack the courage its convictions. It talks about the need for further refinement of the plan and pleads lack of money, but its procrastination also has the whiff of excessive concern for the power of the private school lobby.
A third issue nominated was the National Disability Insurance Scheme, which both major parties federally and the state governments endorse in principle, although they are fighting over how to fund it. It fulfills all three of the above-mentioned criteria.
And the fourth was the Greens's proposal for "Denticare", a national scheme to cover the cost of dental care, which was part of the agreement between Labor and the Greens when they negotiated support for minority government. Milne knows how sensitive the Gillard government is to any suggestion that it has reneged on promises. That provides leverage.
Now, it may be true that these ideas are not universally supported, but they are far from being fringe. Each has the support of a significant mainstream constituency. Each also has the political advantage of being uncomfortable for one or both major parties.
Now let's shift focus from the spending side of the Greens's agenda to the revenue side.
"Well, the Greens are the only party at the moment prepared to say how we would raise money," Milne told 7.30. "We're actually being the most responsible."
The main way they are proposing to do it, as we all know, is by preventing the government from lowering tax rates for big business.
That would increase revenue by about $16 billion over a decade, she says, thus making room to fund the spending measures.
It also has had the political virtue, from the Greens's point of view, of embarrassing the big parties; Labor because it appears to voters on the left as being excessively generous to the big end of town, and the Coalition because its position — also intending to vote against the tax cuts for reasons of political expediency — damages it with its constituency in the big end of town.
Beyond that, she says, she is pressing the government to get rid of what she calls "perverse subsidies to the mining industry, like fuel rebates, exploration subsidies for oil and gas and generous depreciation allowances.
"The things we have strongly put to the government is that we deliver on the policy arrangements that we have jointly put in place," Milne told The Global Mail.
"The key one is to reduce greenhouse gas emissions. And the way you would do that is not only by supporting the rollout of green energy and energy efficiency, but to actually create a level playing field by getting rid of fossil fuel subsidies," she says.
The Greens have not totted up the value of all of them, she says, but the fuel rebate for miners is worth $2 billion on its own.
"So let's do that for a start," she says.
Not only is it environmentally sound policy, it eases the pressure on the budget, she says.
And it could also be a good thing politically for the Greens. The evidence is that the public is increasingly concerned that the benefits of the mining boom are not flowing to the rest of the nation as strongly as they might.
The mining companies are clearly aware of this change over the couple of years since their successful advertising campaign scared Labor off its first iteration of the mining tax. The mining companies apparently see this, because they have begun a new advertising campaign — a rather misleading one, as Bern Lagan reports.
Opinion polling also indicates a shift in public attitudes to mining. John Stirton, research director at Nielsen, says the public overwhelmingly (80 odd per cent of them) still thinks the mining boom is a good thing for the country. But Australians also think taxing the miners is a good thing.
"The polling we've done since 2010, on the new version of the mining tax, has found a majority in favour, which is quite different to the old version of the mining tax," Stirton says.
"So to some extent I think the debate is probably turning against the miners, but only from a position of considerable strength," he says.
While polling is not a good way to measure the arcane details of the tax regime ("Mr or Mrs Parramatta probably do not have a considered view on fuel susbidies," Stirton says), there is no indication of any groundswell of opposition to such potential measures among the populace at large.
Within the demographic Greens appeal to, of course, it is a much bigger deal.
And once again, their proposals to strip back some of the tax benefits for mining see some support from other than the usual Green/left suspects. Saul Eslake, for one, would see the miners' fuel rebate dispensed with. For a more detailed explanation of his position, listen to the accompanying interview with him on the subject.
But let's leave the specifics for a moment and go to the philosophy and strategy behind what Milne is doing.
The philosophy, she says, has not changed with the new leadership.
As to the strategy, much attention has focused on Milne's stated aim to woo voters in rural Australia.
In her talk with The Global Mail, though, she stressed something else: the need to construct a "consistent economic narrative".
People tend to see the party as having "individual interventions on particular issues, they don't see a consistent narrative," she says. "So the community's not hearing where we're coming from on economics and how do we see a consistent internal policy.
"One of the things I'd like to … look at is a vision for the country, and the economic levers that would need to be pulled in order to deliver that vision.
"We need to talk about what sort of country we want to have — good quality of health care, good education system, equality of access to health and education for everyone, all underpinned by sustainability of environment."
She cites the push for the removal of the fuel rebate for miners as an example of this kind of narrative consistency. The extra money would lessen the pressure on the budget, while helping meet the country's goal of reducing greenhouse gas emissions.
"And you would actually have enough money then to start implementing the Gonski Review so that we get some quality education."
No doubt about it, Milne comes from the more pragmatic end of the Green spectrum. If you try to discuss with her some of the party's less mainstream economic policies — we mentioned the policies on estate taxes and taxes on financial transactions — she cuts you short.
"No. What I'm saying is that the Greens have got policy positions on those, but we are negotiating in the current budget context."
The focus is on things that might be achievable, or at least politically advantageous, now.
Not in her book. And she returns doggedly to the economy and the obsession of the two major political parties with a surplus budget.
"What they are doing at the moment is the most radical thing that has been done by a government ever, to take this much money out of circulation. Forty billion dollars in 12 months; that's radical."