Economic decisions don’t happen in a vacuum, they are shaped by the ideologies and values of the people making those decisions.
This Omnibus Bill tells us that the Turnbull government is prepared to sacrifice the community of tomorrow for the sake of the privileged today. It is a government willing to deplete the health, education, infrastructure and public services our community depends on to pay for tax cuts for corporations who don’t currently contribute their fair share.
It is a government ready to cut the income of our poorest at the same time as providing tax breaks for our wealthiest. The government’s program of sustained cuts to public services and infrastructure will not only have a significant impact on the day to day lives of people who are already struggling to get by, they will hinder the chances of future generations to reach their full potential.
Cuts to Newstart payments have left the unemployed and their families living below the poverty line. Cuts to health and education have compromised families’ access to vital health services and the best start in life for our children. Cuts to our higher education, vocational education, TAFEs and apprenticeship programs have limited young people’s access to the skills and education they need for the jobs of the future. Cuts to science, research and renewable energy organisations have weakened our global competitiveness, ability to innovate and create good jobs.
We urge the government not to continue to be driven by expenditure cuts that undermine investment in the fundamental social and tangible infrastructure of economic growth that delivers quality jobs, quality services and high living standards. We can’t cut our way to prosperity. We can only grow and invest our way to prosperity. The ‘trickle down’ logic of the government has always been flawed and now it is widely understood to be inconsistent with strong and sustainable economic growth. This has been repeatedly confirmed by recent findings from the World Bank, IMF and the OECD. Every expert and policymaker in the world, with the tragic exception of those that constitute our Government, now understand that growing inequality in wealth and income is one of the biggest social, economic and political challenges of our time and that public expenditure cuts hamper inclusive economic growth and living standards. As IMF Managing Director Lagarde said at the G20 this year “There must be more growth, and it must be more inclusive.”
Overseas experience shows that cuts which are unfairly targeted at low and middle income households, such as many of those contained in this Bill, have hollowed out working and middle classes and as a result consumer demand; a crucial driver of economic growth, jobs and higher living standards. As well as being morally unjust, such policies are economically unsound and inefficient.
Government investment and expenditure is key to promoting economic growth, jobs and improved living standards. Not only it is unwise to retrench public expenditure at a time when private spending is stagnating and international demand is depressed, it is perhaps even more unwise to ignore or deny the fundamental role that public education, health, research, and a raft of other services play in supporting economic growth. Fiscal austerity is a drag on growth when we desperately need significant investments in physical infrastructure, education, health services and developing the skills of our workforce.
Rather than one-off, short term savings through cuts which have little long term structural impact on the budget bottom line, this government should be developing a comprehensive, long term plan to invest strategically in high quality health, education, skills and training, research and innovation and clean technology and infrastructure to sustain a strong economy and society in to the future.
To do this, the government must have the political courage to address corporate tax avoidance, close tax loopholes and reform egregious high income concessions in areas like negative gearing, capital gains and superannuation. Our revenue base remains less than optimal because we have allowed multinational companies and the very wealthy far too many opportunities to evade and avoid contributing their fair share to the public good. This where the government focus should be – not on short term cuts which undermine the future prosperity of our economy and our society.