Every week, Turnbull’s government becomes more Trump-like

MALCOLM Turnbull’s government grows more Trump-like every week. Last week’s health-insurance announcement and this week’s energy announcement illustrate the point.

President Trump is fond of describing his policies in exaggerated terms that if achieved would be good for the mass of Americans, but the detail of the policies reveal that they would do exactly the opposite.

He said his repeal and replacement of Obamacare would deliver better health insurance to Americans. In fact all his and the Republican Party’s proposals would have stripped up to 22 million Americans of their cover.

Last week, the Turnbull Government said its new proposals would make private health insurance “simpler and more affordable”. In fact they will just add to the insurance companies’ bottom line.

And the policy missed the essential gripe about private insurance – it is not just the cost of the premiums, it is also the shocking out-of-pocket costs that patients get hit with when they use the insurance. The Government did not address that.

This week the Government described its new energy policy as “a credible, pro-market policy that delivers lower electricity prices. It means no subsidies, no taxes, no trading systems.”

In fact, the Government provides the fossil-fuel industry with about $11 billion in subsidies a year, according to environmental analysts Market Forces which also says that 57 fossil fuel companies operating in Australia and making a total of $60 billion a year paid no tax in 2013-14 or 2014-15.

We are subsiding old technology when the way to cheaper electricity is obviously through renewables.

The Turnbull Government has other Trump-like qualities.

Like Trump, it has swallowed the voodoo economics of tax cuts for the rich. The theory is that the tax cuts trickle down into more jobs and higher pay for workers. In fact, the tax cuts will just add to corporate profits. There is only one thing that trickles down from the boardroom above to the workers below, and it isn’t money.

The Turnbull Government wants to cut the corporate tax rate at a cost of more than $50 billion over 10 years. As the experience of the Reagan presidency tells us, that will just add to the deficit which will ultimately mean fewer services and lower welfare.

The Turnbull Government also lowered income tax for people on higher incomes. The top rate went from 47% to 45% and the threshold for moving into the 37% bracket was raised from $80,000 to $87,000. So everyone on more than $80,000 got a tax cut. Meanwhile, there is no relief for those on just $37,000 moving from the 19% bracket to the 32.5% bracket.

So tax cuts for the rich and those on just a tad over the minimum wage will be hit with a marginal rate of nearly one third of their extra income.

It is similar to the Trump agenda to lower tax for high-income earners.

Another Trump similarity is that just as the Republicans want to tear down anything the Democrats have done, the Coalition wants to destroy Labor programs.

They have turned the original state-of-the-art NBN to a low-speed, second-rate, copper-wire-dependent network with very little cost saving. Most people’s NBN will be no better than their current ADSL service. As a result, the NBN government-owned asset has lost a large amount of its value.

The Coalition wrecked Labor’s education funding scheme with Gonski 2.0 – reminiscent of Trump’s modus operandi of repealing the existing and promising something newer and better, but which would be demonstrably worse.

The theme here is not just the similarities between the Turnbull Government and the Trump Administration, but also a general failure to recognise the power and potential of the public sector.

Instead of preaching that the private sector is always better than the public sector, why don’t they accept that the public sector sometimes performs better than the private sector.

For example, even former Coalition Treasurer Peter Costello thinks that a government-run superannuation fund for compulsory superannuation contributions would out-perform both private and industry funds. He is right. Public-sector employees get better returns. Private-sector employees, however, are barred from them.

And, as economist Nicholas Gruen points out, how we would all love to have out mortgages taken out with the public-sector Reserve Bank at the cash rate, than with any of the private banks.

In health, only the public system can deal with the serious chronic or catastrophic cases. Yet the Health Minister still asserts: “Private health is fundamental to choice. It’s fundamental to the ability of Australians to have peace of mind.”

Tell that to the relatives of someone catastrophically injured or who has a illness serious that is long-term enough to make the out-of-pocket expenses force them into the public sector.

There was no peace of mind for people on modest incomes who could not afford insurance in pre-Obama America. Peace of mind comes from a universal public system.

In education, we have squandered public money on elite private schools that would have a far better educational result if given to needy public schools where it would have gone to teachers, not swimming pools.

We can only hope that the false promises of lower prices, lower emissions and reliable supply without any significant government intervention and of simpler cheaper health insurance will come home to roost.

They have about as much credibility as Tony Abbott’s assertions that Whyalla would become a ghost town and legs of lamb would be $100 under a carbon tax and that electricity prices would come down with its removal. As we know electricity prices went up, and you can buy a leg of lamb at Coles in Whyalla, which is open today from 7am to 10pm, for $27.50.
CRISPIN HULL
This article first appears in The Canberra Times and other Fairfax media on 20 October 2017.