The Climate Is Heating, The Economy Is Cooling. The Jobless Are Obviously To Blame



Scott Morrison’s war on welfare is all about distracting us from climate chaos and a worsening economy, writes Ben Eltham.

According to Shakespeare, winter was the season of England’s discontent. But the Bard never got to visit Australia in the Anthropocene.

It’s a mark of how radically our climate is changing that spring now seems pretty hostile too. Fires and drought ravage Queensland and New South Wales. Reefs die, rainforests burn, and rivers dry up.

We are now used to the Coalition ignoring the science on climate change, and so further lies and denial can blend into the background.

But consider that this week, while Queensland suffered devastating fires, the Queensland Nationals Minister for Water (and natural disasters) David Littleproud publicly stated that he didn’t know if climate change was caused by humans. Meanwhile, the New South Wales state government proposed an emergency ‘Noah’s Ark’ project to move fish from waterholes in the Darling basin. As the climate crisis intensifies, the reaction of pro-pollution conservative politicians looks increasingly risible, even bizarre.

An SBS News screengrab of one of the massive fish kills in the Baaka (Darling River) earlier this year.

Australia faces a climate crisis – now, today. But the government’s policy is not just to ignore it. The government’s policy – from backing Adani to ignoring the next global climate meeting – is actually to make climate change worse.

And then there’s the economy. There’s no sugar-coating it: Australia’s economy is in trouble. Last week’s national accounts figures showed gross domestic product grew  just 1.4 per cent in the past year. Unemployment is trending up. Consumers have stopped spending. Wages are stagnant, living standards are flatlining, while business confidence is falling. Interest rate cuts and the government’s much-vaunted tax cuts haven’t worked.

Growth of just 1.5 per cent a year is the slowest growth since the global financial crisis. With Australia’s population growing at around 1.6 per cent annually, the economy is actually shrinking in per capita terms.

The root cause of the malaise seems to be generally agreed: stagnant wages. Once adjusted for inflation, wages for Australian workers have gone nowhere for years. Static wages are eroding the foundations of the economy, some parts of which are in real trouble. Household consumption is anaemic, also at its lowest point since the GFC. Consumer sentiment is flat; retail spending and business confidence are both falling.

House prices in Sydney and Melbourne have bottomed out, which is good news for sellers (but bad news for buyers still locked out of the market). But it at least signals that there won’t be a housing crash in the short term – the true nightmare scenario for RBA governor Phillip Lowe.

And yet, despite the manifest weakness, Treasurer Josh Frydenberg refuses to follow Lowe’s advice, and open the fiscal spigots. Obsessed with the bragging rights of a government surplus, Frydenberg is doing nothing while the domestic economy slows.

Treasurer Josh Frydenberg. (IMAGE: ABC News screencap)

There are also plenty of risks on the downside, from falling commodity prices to geopolitical instability from the likes of Boris Johnson, Donald Trump and Xi Jinping. Australia is poised at a delicate juncture. Even sympathetic observers wonder whether the glorious years of uninterrupted economic growth can continue forever.

Those who remember the heat applied to Wayne Swan and Julia Gillard over economic figures far healthier than those currently presided over by Josh Frydenberg and Scott Morrison may wonder why the electorate always seems to believe a Coalition government is better for the economy. It’s always easier for a conservative government when it comes to the economy, as Frydenberg must secretly acknowledge.

With Queensland on fire and the economy clinging on for dear life, you’d think the government would have all hands on deck.

But no. Consider the items on the government’s policy agenda at the moment: drug-testing welfare recipients, expanding the cashless welfare card across the country, and legislating to stop animal rights activists trespassing on farms.

These are less than first order issues for a nation grappling with an existential environmental crisis and an incipient economic downturn.

All the while, stubborn scandals gnaw at the government’s legitimacy. Energy Minister Angus Taylor faces genuine questions of malfeasance over his intervention in an Environment Department matter regarding protected grasslands – a policy intervention that appears to have directly benefited his own family farming interests.

Former cabinet ministers Christopher Pyne and Julie Bishop have taken lobbying jobs with the very industries they only recently made the rules for. Peter Dutton’s Home Affairs ministry remains an open sewer of dubious contracting, dodgy procurement and policy failure.

Former Coalition Minister, Christopher Pyne.

To top it all off, Morrison has put Stuart Robert – a minister who has already been sacked once for breaching the ministerial code of conduct – in charge of the National Disability Insurance Scheme.

Scott Morrison surprised many with his election victory, but his mandate is as thin as his policy platform. The tax cuts enacted, his South Pacific humiliation conveniently forgotten, the Prime Minister has gotten down to what passes for the real agenda of his administration: endless culture war.

The aim is not really welfare reform. Nor is it about protecting farmers. The latest round of welfare bashing is all about wedging Labor, and keeping the media focus off the economy and the environment.

Morrison believes the ALP is vulnerable to his reheated culture war talking points – and Labor’s skittishness on some of these issues shows he may be right. Zhe Prime Minister showed during the election campaign that choosing a one-dimensional agenda and sticking relentlessly to it could work. But to pull it off, he needed an unusually unpopular Labor leader, and some extraordinary good luck .

Culture war talking points won’t work forever. Voters know climate change is real, and at some point they will start to punish the Coalition for its inaction. Labor may also eventually emerge from its current bout of navel-gazing and start to exert genuine pressure from opposition.

And nothing will be more uncomfortable for this extraordinarily complacent government than an economic downturn.

If we do get a proper recession, all bets are off.


Ben Eltham is New Matilda's National Affairs Correspondent.