Joe Hockey. Photo: Jay Cronan
It appears that the 45th Parliament will not be called until late October. Whatever happened to the national emergency of a budget in crisis?
Even a dullard might now see that it was all scare mongering. Not that many would be bothered now that the election is all over. We know, of course, that politicians use the economy as their plaything to score political points. The scuttlebutt and adversarial politics does not elevate the community's understanding of economics.
In the last election it was the opposition that made the running. Some might forget that Australia is now the 12th largest economy in the world and that other economies have fallen by the wayside as Australia has marched on. On election night Senator Arthur Sinodinos let the cat out the bag by saying that the economy was in pretty good shape. Indeed it was. In the cold light of day the Labor Party has gifted the Coalition a blue ribbon economy which should allow them to be in office for a considerable period.
There is a strange asymmetry at play in Australian electoral politics. The Labor Party is usually seen as a poor economic manager compared with the Coalition. There is no doubt this perspective certainly shaped the election outcome apart from the internal leadership squabbles and factionalism within the labour movement.
Labor lost considerable credibility with its silly commitment to bring home a surplus in this year's federal budget. The then shadow treasurer Joe Hockey could crow that the Labor Party would never deliver a surplus and that fiscal profligacy was part of their DNA. It made its mark. This perspective overlooks the fact that in recent economic history it has been the Labor figures like Bob Hawke and Paul Keating who did the heavy lifting in reforming and internationalising the economy.
Australia has just had a 10-year boom, between 2003 and 2013, but relatively little to show for it. We expended it on middle class welfare and tax cuts. In time we might look upon that golden age with some recrimination. In perhaps what has been his most significant speech to date, Hockey spoke about ending the entitlement culture within Australian society but from the start Tony Abbott's gold-plated parental leave scheme is the absolute negation of that. For Hockey the moment of truth has come. John Howard assigned him difficult portfolios because of his broad shoulders. Now he has the keys to Treasury.
Hockey has not made an auspicious start in the election campaign. First, he forgot to declare some of his wife's pecuniary interests. Second, during the campaign he inferred that the government key economic adviser, the Treasury, and its economic forecasts, were not credible. He has now compounded it by saying that Treasury's figure work will be augmented with that of private sector economists and consultants.
He has even promised to sit down with Treasury boffins and go through their methodology. We must ask how a whole building of economists cannot get their revenue projections right but lone hand economists in Melbourne and Sydney can. The Coalition feels that the real problem with Treasury is that they are too remote from the big cities.
How will Treasury take to their new master? Hockey will be the third treasurer this year. Unlike his predecessor, Chris Bowen, who had an economics degree, Hockey comes across as full of bluster and bombast. He has made an art form of ridiculing Labor's record by furrowing his brow, bowing and shaking his jowls and smiling. It won't cut it in Treasury.
We already have had jolly Joe telling us to spend our ''hearts out because we are going to have a good Christmas''. He will be in for a tougher time than he thinks. It won't be too long before the hard hats and the business lobby groups tell Abbott that they need to tackle the structural budget deficit now instead of letting it drift.
Alex Millmow is a senior lecturer in economics at the University of Ballarat.