After being interrogated by Labor over his comments on ABC Radio yesterday, whereby he served Australia’s youth another housing shit sandwich, Prime Minister Malcolm Turnbull has hit back claiming Labor is engaging in “class warfare”. From The Canberra Times:
“Can the Prime Minister confirm that in the past two weeks his advice to young Australians struggling to buy their first home was to have rich parents or to have parents who buy you a home when you turn one.”
“Prime Minister, just how out of touch are you?” Mr Shorten said.
Mr Turnbull accused Labor of waging class-warfare.
“They are sneering at the hardworking Australians who seek to make something for their children. And they dare to talk to us about being out of touch! This is a war – a political war – they want to commence against aspiration, against ambition, against enterprise,” he said.
It’s a theme that Treasurer Scott Morrison has also run with. From The AFR:
Treasurer Scott Morrison has called for an end to the class warfare and handout mentality that surrounds federal budgets, warning it will run the country into the ground…
“We have got to stop looking at the economy as if it’s a whole bunch of individuals, and they are all looking for their little bit out of the government,” Mr Morrison said.
“If that’s the sort of country we are going to run, we’ll run it into the ground and we’ll run each other into the ground…
“Australians are over this class warfare, they are over the us and them. They are over it. They know the big economic challenges that are out there facing them and their future. What they want from us is a stronger economic plan that gets them to that other side.”
Now let’s look at some of the key policies from the Turnbull Government:
- Maintain Australia’s negative gearing and capital gains tax rorts, which Turnbull himself described as a “tax shelter” and “tax avoidance” in 2005, whilst also claiming that they had helped create a “property bubble” and are “skewing national investment away from wealth-creating pursuits, towards housing”.
- Slashing the company tax rate to 25% over a decade – a move that would primarily benefit foreign shareholders/investors and could actually lower national income and raise inequality. Moreover, The Australia Institute estimates that the 5% cut to the company tax rate would $19.7 billion annually by 2026-27, although some of that will return to domestic shareholders (through the reduction in franking credits received).
- Raising the $80,000 income tax bracket to $87,000 – a move that would benefit the top 25% of taxpayers only, most of whom are men, and thereby would worsen inequality (see below graphic).
Against this, there is some sensible reforms to superannuation that would affect some 4% of wealthy participants. But it is nowhere near enough to counter the other policies that the Coalition supports.
If there is one party waging “class warfare” it is the Coalition, who continues to favour rich over poor, existing home owners over aspirants and renters, old over young, and assets over income.
