Key surveys this week revealed that consumer confidence has gone further backwards, even after the recent cut in interest rates, business conditions are getting worse, and the retail sector, in particular, is already in recession. Actually this should have come as no surprise. Even though the recent surprise re-election of the Morrison government was greeted with a degree of ebullience and/or relief, this actually did very little for consumer and business confidence.
The Morrison election strategy was to control the economic narrative, relying on slogans claiming a "Strong Economy" and a commitment to "Make It Stronger", while creating a sense of anxiety, nervousness, even fear, about a Shorten alternative.
While he won, it was only by about one seat more than Turnbull had enjoyed, while both major parties were "on the nose", with their combined vote falling yet again.
Moreover, Morrison's marketing strategy, rather than policy agenda, failed to directly address the key issues facing consumers and business, especially key elements of the cost of living faced by households that are struggling, week-in, week-out, to survive, and by business faced with no sense of longer-term policy direction, and financing difficulties, all against the background of a precarious and unpredictable global economy.
Households simply can't get "confident" about their future when they have record levels of debt, have run down any savings, are stuck with flat wages, and their house prices falling, thereby risking more mortgage stress and even negative equity, as the banks have tightened credit. Households have little left for "discretionary spending". Any cut in interest rates, or even a tax cut, may also not see them increase spending, but maybe simply reduce their debt.
Further, none of this is helped by the hiatus created by the fact that some six weeks will have elapsed between the election and Parliament re-sitting, with considerable uncertainty about the government's likely legislative agenda, and particular concern/doubt about their ability to legislate their promised tax cuts in full. Indeed, many doubt that the promised tax cuts can actually be "afforded", when the huge unfunded expenditure commitments, running through the 2020s, are recognised.
Unfortunately, our governments have increasingly become "reactive" rather than "proactive", with little or no "vision" as to where they would like to see, or take, Australia over the next several decades.
Australians are tired of the short-term politics of point scoring and blame shifting, while key issues are simply ignored, or pushed down the road.
Sure, the campaign rhetoric referred to the costing of some policies "over a decade", but such numbers are, quite frankly, meaningless. Although designed to supply a sense of the "longer term", they are more to create a concern/fear about the longer term "costs" of some declared initiative, such as Morrison banging on about the "$387 billion" cost of Shorten's tax initiatives.
This is hardly "visionary" nor substantive, and certainly not providing a sense of direction for our nation.
Equally, while huge and unfunded defence and infrastructure projects, potentially costing hundreds of billions, running well into the 2030s, are designed to convey some sense of "forward planning", they are so far short of being specified in any detail, and from being delivered, and have also simply been announced, but not in the context of any well thought out, and detailed, longer-term growth or defence strategy.
The electorate wants an honest assessment of where we are as a nation, economy and society, and of the challenges we will face, and then crave for the leadership to delineate a pathway and framework to move our nation forward, and a commitment to deliver. They are tired of the short-term politics of point scoring and blame shifting, while key issues are simply ignored, or pushed down the road.
They want policies to genuinely improve housing affordability, especially for the young and disadvantaged; they want policies to provide much cheaper and reliable power; affordable childcare; genuine and affordable support for the disadvantaged, including the low income unemployed; and a deliverable pathway to a low carbon society by 2050; indeed, they want broad-based reform across most areas of public policy.
They are tired of the reactive, "muddle through" governments. Unfortunately, unless Morrison accepts these realities and moves decisively to respond, we will further drift towards recession and perhaps another GFC.
I doubt he gets it, or even wants to!
- John Hewson is a professor at the Crawford School of Public Policy, ANU, and a former Liberal opposition leader.