Comment

Union workers protest against the Abbott Government's decision not to continue subsidising Holden car manufacturing in Australia.

Union workers protest against the Abbott Government's decision not to continue subsidising Holden car manufacturing in Australia. Photo: Jason South

Like electorates, not all workers are created equally. But while politicians are explicit about which seats are marginal and which are not, the language that is used around jobs is much more subtle. But whatever words we use, the fact is that governments care a lot more about some jobs than others.

As residents of Canberra know better than most, public sector jobs are at the very bottom of the political hierarchy. Manufacturing jobs, on the other hand, are at the very top. The difference is so stark that the same politicians who want to ''rescue'' manufacturing workers are often proud to say they are ''slashing'' public sector jobs.

Unfortunately for Canberra, our economy is doubly cursed. Not only do we have a preponderance of the public sector jobs which politicians love to hate, but neither of our two lower house seats are considered marginal. Put simply, because we have the wrong kind of jobs in the wrong kind of electorates, promising to shed tens of thousands of jobs from our major industry is seen as a vote winner.

<i>Illustration: Ron Tandberg</i>

Illustration: Ron Tandberg

When Ford announced its intention to shed about 1200 jobs, there was national hand-wringing and the announcement of an assistance package totalling $50 million. The current government went to the last election promising to shed more than 10 times that number of public servants, a promise it seems determined to keep.

Manufacturing jobs in marginal seats are, of course, an entirely different kettle of political fish. Just as Labor announced an ''adjustment package'' for Ford workers earlier in the year, the Abbott government is set to deliver a $100 million package for Holden workers. It's clear that politicians find it hard not to spend when manufacturing workers are retrenched.

Sacked call centre workers are unlikely to attract such support. Similarly, those whose banking, retail or IT jobs are shipped offshore are unlikely to attract much political attention, and they have virtually no chance of benefiting from any ''adjustment package''.

While the loss of service sector jobs is unlikely to attract government cash, the only job losses that attract the cheering of politicians are public sector jobs. Of course Joe Hockey isn't the first politician to make political capital out of causing unemployment. In 2007, Kevin Rudd promised to take a ''meat axe'' to the public service.

Let me be clear, I think that when people unexpectedly lose their jobs it is always a tragedy that has the potential to devastate the individual, their family and their community. I think that, regardless of whether it is a manufacturing worker or a public servant, losing a full-time income and trying to pay the bills on an unemployment benefit of $250.50 a week is virtually impossible.

If we really cared about retrenched workers we would significantly increase the unemployment benefit, but neither the government nor the opposition has mentioned that this week.

At a local level, Zed Seselja said he would be a loud voice for Canberra in the Abbott party room, but to date he has been silent on his plans to deliver anything but pain for the community he was so keen to represent.

It has been estimated that one public servant per hour has lost their job since the election, but what is not known is when will the cuts stop?

What is Senator Seselja's plan to create private sector jobs in an environment where the public sector is shrinking?

Managing the economy is far more complex than balancing the budget. In fact, the two have almost nothing in common. While Treasurers often use household or corporate analogies to explain their obsession with ''balancing the books,'' a closer examination suggests that neither analogy is meaningful.

Contrary to popular belief, mining companies were running huge deficits during the mining boom as they borrowed tens of billions of dollars to build the mines that would deliver them future profits. A mining CEO who tried to run a surplus every year would be sacked for lacking a growth plan.

Mid-level bureaucrats may have to balance the budgets their bosses gave them, but corporate and political leaders need to bet their careers on investments in the future.

Most households aspire to running big budget deficits. A family that earns $150,000 a year and buys a $500,000 house is racking up quite a big deficit that year. Having done so, they are likely to remain in debt for 20-30 years. But buying a house means saving on rent. And, unless they choose badly, the house they buy for $500,000 is likely to be worth more than $1 million by the time they sell it.

The budget deficit or surplus is nothing more than the difference between the flows into and out of the government's main bank account. The budget deficit makes no distinction between expenditure on corporate welfare and expenditure on long-lived infrastructure. In accounting terms, it is little more than a cash flow statement.

As the 9200 already unemployed Canberrans are painfully aware, sacking public servants is no way to stimulate an ailing economy. Indeed, while much is made of the ''multiplier'' or ''spillover'' job creation that allegedly comes from the expansion of the mining industry, the simple fact is that when you sack tens of thousands of public servants there will be negative impacts on the wider economy. That's right, it will lead to the loss of private sector jobs in Canberra.

Tony Abbott and Joe Hockey would have us believe that they are ''great economic managers'', but as unemployment rises and more jobs go overseas, their only ''strategy'' seems to be to shed some of the workers that they themselves employ. So rather than develop a plan to reduce unemployment, they are having a Commission of Audit into how to sell the family silver and cut the tax rate paid by big foreign companies.

Anyone who owns a house can run a huge surplus and pay off most of their debt next year. All they have to do is sell their house. But just as making good household decisions is more complex than looking at your bank balance, managing the economy is more complex than running a surplus.

Joe Hockey's job is to manage the economy, not just balance the budget. With Treasury forecasts implying the number of unemployed Australians will rise by 22 per cent, it's time he started on the hard stuff.

Richard Denniss is executive director of The Australia Institute.