Kathy Marks: 'Electoral suicide' and only a drop in the deficit bucket

Australian Prime Minister Tony Abbott.
Australian Prime Minister Tony Abbott.

In one fell swoop, Tony Abbott has angered his own backbenchers, alienated his core supporters and earned stinging criticism from economists and the Murdoch press. That's quite a feat.

Did he really think he'd get away with the ludicrous claim that his proposed "deficit levy" isn't a new tax? Did he really think voters wouldn't notice he was breaking a fundamental pre-election promise? Did he really not realise it amounted to "electoral suicide", as one unnamed Abbott minister put it in yesterday's Sydney Morning Herald?

For a Rhodes scholar and seasoned Canberra operator, Abbott can be surprisingly dense. He didn't, apparently, even warn some Coalition MPs about his plan to slug Australians earning over A$80,000 ($86,768) a year with, reportedly, an extra 1 to 2 per cent tax in May's budget. Not surprisingly, the phones in their electoral offices have been ringing hot.

Yesterday's headlines said it all. The levy was "just a new tax by another name", declared the Australian, usually slavishly supportive, in a scathing editorial. Abbott was "betraying our trust", fulminated Miranda Devine, one of Abbott's favourite right-wing columnists, in the Daily Telegraph. The front page of the Sydney Morning Herald warned of a (Liberal) "party-room revolt".

Most ominously, one senior Liberal told the Herald that this was "Tony's Gillard moment" - a reference to the promise made, and then broken, by the former Labor Prime Minister, Julia Gillard, not to introduce a carbon tax.

In vain can Abbott argue - as Gillard tried to, failing to mollify incensed voters - that circumstances have changed.

The then opposition leader spent the whole of the last parliamentary term branding Gillard a liar who had let down honest, hard-working Australians. "Axe the [carbon] tax" and "no new taxes" were his constant refrains during the interminable 2013 election campaign.

Who do you trust, he asked voters repeatedly, and last September they tentatively put their trust in a man about whom goodly numbers instinctively harboured doubts. Seven months on, the middle and high-income earners - many of them Coalition supporters - who will stung by the new tax are entitled to feel let hoodwinked, let down and (given Abbott's expectation they would swallow the "temporary levy" idea) plain insulted.

On top of being politically foolish, next to no one believes the "levy" will solve Australia's fundamemtal budget problem, which is that - thanks to spiralling health, education and social security costs - the government is spending more than it raises.

Among those criticising the deficit levy idea have been the Australian Industry Group, the Business Council of Australia and the Australian Chamber of Commerce and Industry. They fear that higher taxes will curb retail spending and slow the economy.

Bill Shorten, meanwhile, looks like all his Christmases have come at once. Given a column in the Telegraph to vent his bile - a rare privilege for the Labor leader - he thundered: "A tax increase is a tax increase. A broken promise is a broken promise."

Elsewhere, he added: "No amount of weasel words by Tony Abbott and his Liberal government can change the truth."

While few dispute that tough economic measures are needed, Abbott is proposing the kind of nasty medicine which governments usually save for a second term. Then again, it seems inconceivable, at least at the moment, that his government will win a second term. The next opinion polls will make interesting reading.

- NZ Herald

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