The 'people's rollback" versus Labor's

Issue 

Editorial

The people's rollback versus Labor's

In the five years since John Howard was elected prime minister, his government has carried through a breathtaking range of attacks on the working class. Key among these were the sale of Telstra, the introduction of anti-union legislation and a total overhaul of the tax system, shifting the burden further from rich to poor.

In a period of “economic prosperity”, this has resulted in falling living standards for most Australians. The newspoll released on May 31 confirmed that 53% of Australians believe that they are worse off under the GST, while only 10% believe they are better off.

The release of the 2001-2002 federal budget, although predictably mild given that it is an election year, indicated that the Coalition has no intention of stepping away from its Robin-Hood-in-reverse policies of transferring wealth from the poor to the rich.

In his official response to the budget, Labor “opposition” leader Kim Beazley signalled once and for all that the ALP has no intention of dismantling the Coalition's program, never mind those policies introduced under the previous Labor governments of Bob Hawke and Paul Keating.

Beazley's performance was almost amusing in its attempt to outbid the government's crude bribes. Instead of payments to war heroes, we got cancer clinics. Instead of pensioner bonuses, we had a modest boost to public school funding. Small amounts of money to worthy causes, but no fundamental restructuring.

If this continues, the charities will do well from the election campaign, but the rest of us can expect to be left out in the cold.

The only substantial difference between the pre-election promises of the Coalition and Labor is that the ALP tell us they support “rollback”.

Nobody is exactly sure what rollback is — not even the ALP. The only detail the ALP has confirmed is that the GST will be removed from charities, hardly a measure likely to help most Australians.

On the one hand, shadow treasurer Simon Crean assures the business community that rollback will not involve “fundamental changes to the system”; on the other hand, Beazley implies that it will make the GST fairer and poor-friendly.

But there is no such thing as a poor-friendly consumption tax. Consumption taxes impact worst on the sectors which consume most of their income, the poor, and impacts least on those who invest a portion, the wealthy. It's not a difficult concept.

The ALP has never been seriously opposed to the GST. Knowing which side their bread is buttered on, it has consistently supported pro-business tax reform.

Even the ALP's pledge to modify the GST is a concession to the growing public sentiment on the issue. During the 1998 election campaign, conscious of the need for big business support, it argued that they would not dismantle the tax once Howard introduced it.

It was only when the reality of the GST started to hit working people's hip pockets that Beazley coined the term “rollback” and implied that the ALP was still anti-GST after all.

But Labor's position on the GST is indicative of where they stand in the class divide. The ALP began the economic rationalist offensive that sought to maintain growth rates at the expense of working people's living standards.

A real rollback would be a rollback of the living conditions that have been stripped away. This would need to start with the re-nationalisation of the Commonwealth bank and GIO and the buyback of Telstra.

It would need to restore government funding stripped from public schools, universities, hospitals and government services. It would mean a strengthening of union power, and re-regulation of key industries.

Most of all, we need a rollback of wealth from the pockets of the super-rich to the rest of us. We could start by re-raising the corporate tax rate and clamping down on corporate tax evasion.

But that sort of “people's rollback” is something the ALP will never support. Because it is as committed to economic rationalism as the rest of the elite. And any real rollback will have to roll right over them. 

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