The curious inversion of Turnbull and Shorten credibility

There’s a transition underway in politics that was quite unexpected a few years ago. Labor leader Bill Shorten, backroom political hack and hollow man par excellence, has become the substantive policy leader in Canberra.

This is obvious in both political and policy terms. The Labor Party is rolling out the largest and most comprehensive taxation reform agenda from opposition since John Hewson’s disastrous Fightback:

  • negative gearing is to removed from existing property and left on new;
  • property capital gains concessions will be removed;
  • family trust loopholes will be closed;
  • superannuation concessions that favour the aged and wealthy will be cut;
  • the corporate tax rate will be leavened with accelerated write-offs for capex.

These policies are all well thought through, progressive, pro-growth and productivity, as well as embracing inter-generational equity and Budget responsibility. Moreover they are transparent and the polity will be free to judge in advance which will give the incoming government a genuine mandate.

On the other hand, we have the always charming Malcolm Turnbull who built a career on persuading middle-Australia of his progressive values and reformist credentials doing absolutely the opposite. He has betrayed every statement in his past to defend vested interests and to put forward a grotesquely regressive Trump tax agenda:

  • cut the corporate tax rate to boost foreign shareholders not investment;
  • cut personal taxes (which is good if they are fair);
  • scare-monger and protect negative gearing;
  • scare-monger and protect superannuation concessions, and
  • scare-monger and protect family trust loopholes.

Most of his positions are brain fart moments, regressive, growth neutral, inter-generational theft and Budget irresponsible.

In short, Shorten’s policy leadership has applied a stinging wedgie to Do-nothing Malcolm’s empty crotch. And he is likely to take on Turnbull’s only good policy too, in personal tax cuts.

So, who’s the backroom political hack and hollow man par excellence?

Comments

  1. And all it would take is one member of Labor to hint that the intercepted at sea policy in place will be overturned like the krudster did and it’s a guarantee loss.

    • Yep. Until the far left of the party is gone, no one’s interested in what they’re proposing. Australians can’t hear them.

      • You misunderstand the ‘far left’. it’s not because the far left are IN Labor, it’s because they are losing votes to the far left.

      • Calvin

        Same thing. They’re catering to the far left and alienating their original working voter base.

      • Or alternatively their voter base is not as big as they thought and diminishing. Blue collar workers are a dying breed replaced by 457s, but you don’t see labor pushing against it, nor the greens, or the libs…

      • Australian workers don’t want LNP. They want Labor back. Let the Greens have those inner city seats. Greens will side with Labor anyway. Is the problem the power within Labor from inner city candidates like Plibersek is too strong?

        Australians outside of inner cities have walked away from Labor. That is the whole country’s problem.

      • bolstroodMEMBER

        Yesterday you said you were a socialist, today it’s do away with the far left of Labor.
        Tommorrow….

      • bolstrood

        Anyone that’s observed the world knows you can choose either a big population or fairness.

        Choose one.

      • Bolstrood

        My view is entirely consistent. Greens have dragged Labor away from enough support to put them out of government. How’s that working for socialism?

        Greens = too far = too ridiculous = LNP government

  2. Labor might have missed the mark a bit with their proposed abolition of franking credit cash refunds:

    https://grattan.edu.au/news/a-piecemeal-move-towards-a-fairer-tax-system/

    “A first-best policy would reintroduce a number of higher-income, higher-wealth older Australians to the tax system by taxing superannuation earnings and abolishing age-based tax rates. But in the absence of the political will to make these changes, abolishing cash refunds provides a big boost to the budget bottom line from more or less the same group.

    In a world where the appetite for wholesale tax reform has stalled, the government has been running sizeable budgets deficits for almost ten years and the income tax burden on working Australians continues to rise, a policy that indirectly requires richer older Australians to contribute may be the best we can do.”

    The real problem is the tax rates. Someone needs to decide if we want to tax income at the company tax rate or at the individual’s marginal tax rate. If it is the company rate of 30%, it catches people (for example) with a handful of shares and not much else. In a sense it seems to me that this is like applying a flat, regressive tax rate to all individual franked dividend recipients irrespective of their taxable income. Actually solving the problem would focus on actually getting retirees to pay their fair share of tax, but of course no one is game to tackle that.

    Labor’s proposal partly solves the problem, but using the wrong tool. I suspect they knew they could get Industry super support for the imputation credit strategy, but not a reintroduction of taxes on super in pension phase. That’d piss off a lot of voters too, especially on top of the recently introduced 1.6m cap.

  3. Labor need to simplify their explanations as there is a lot of confusion about this issue.

    The proposed change to franking credits is equivalent to removing a tax refund for people who haven’t paid tax in the first place.

    If Labor can get their economic message to cut through with the population, they win. Otherwise, it’s Fightback Mk II and they will lose what would otherwise be considered unloseable.

    • @L
      “The proposed change to franking credits is equivalent to removing a tax refund for people who haven’t paid tax in the first place.”

      What you say is true if company profits are to be taxed at the company level. Not so much if they in fact pass through to the shareholder owners of the company and are taxed at their marginal tax rate.

      Don’t get me wrong. I am no lover of the status quo, and I like that Labor are putting up some things that actually look like policy, but they arguably are not tackling the main problem here. And while Scomo is probably too dim to understand why, Shorten risks looking a bit dishonest with his simplistic shorthand class equality based justifications.

      Because few in the electorate seem to understand the imputation system very well, the victor on this one might be the better bu!!shitter. Like most of what passes as political discourse in this country.

    • sydboy007MEMBER

      Exactly. They need to jut ask the Govt ministers why someone is entitled to a refund if they didn’t pay any tax? The company tax rate of 30% needs to be applied.

      • Syd

        You need to read what Stitches posted yesterday under the article of Do Nothing Turnbull and all will be revealed.

      • I saw stitches comments and not really impressed. What does taxable income even mean in a tax system that allows asset rich boomers to distort their income to the point of appearing low income?

        It is no coincidence that it is boomers that are overwhelmingly up in arms over this proposed reform, it is yet another example of generational welfare. I don’t have a property portfolio to reduce my taxable income, never mind the opportunity to accrue a first home by the time I am retiring. So how is this anything but another regressive tax loophole?

      • @Sydboy007; Pretty simple really; 30% tax has already been paid by the company paying the dividend. Whether the dividend is received by someone with no taxable income or someone earning $750k pa paying 48% tax is really irrelevant. Ironically individuals earning less than $30K or so will now receive little to no benefit from a franked dividend whereas the high income earner retains the full value of the tax benefit. This is typical of the ALP, broad-brush a “problem” under the guise of an attack on the wealthy, throw in a few extreme example of high net worth super funds, but don’t mention the far broader impacts right across the community. Shorten also neglects to mention that the current policy was actually ALP policy in the late 90s, and that the ALP back then openly touted the benefits of cashing-out franked dividend benefits to low income earners and retirees.

      • Brenton

        Suppose that you are on $150,000 pa and own FF shares, you will get the same tax benefits via imputation as a retiree on $20,000. If the shares are in your wife’s name and she is a stay at home mum then she may receive a tax refund due to imputation credits; get it ?

        Is that scenario fair to you ?

        Did you know that Shortens tax figures come from the F/Y 2014/2015 and are irrelevant to this debate.

        Superannuation changes from 2016 means that there is a $1,600,000 limit on super in pension phase and shows Shortens LAB data as outdated and thus misleading.

        The irony of all this intergenerational crap is that Gen X and Y will have far more in super than the BB ever had, due to higher wages and super contributions, so this will impact upon Gen X/Y far more.

        A double whammy for Gen X and Y is that the cashed up HNW SMSF trustees may allocate more money to property rather than shares, thus increasing the cost of housing and freezing out the prospective young first home buyer….the irony.

        Shorten should have gone after the HNW SMSF, so what went wrong ?

        Shorten is helping the FIRE industry and foreign investors in the ASX and punishing Australian retirees. Such leadership skills ?

    • Hi L ( Sorry Wrong place )

      Shortens policy is populist and unfair to the lower income base.

      An article here 2 days ago, ” Do Nothing Turnbull ” has a couple of posts by Stitches and he/she sums it very nicely.

      Please take 5 minutes to read it.

      Go Stitches !

      • Could be wrong, but didn’t I read that those well off make their income less than 20k, eg negative gearing of properties

      • Tassie TomMEMBER

        “unfair to the lower income base”

        “Income” has nothing to do with whether you’re rich or poor. That’s what “wealth” is.

        The “losers” out of this are going to be people on low income with high wealth, eg, “I’m so rich I don’t have to work. That makes me low income – please fill my begging cup”. Most of these will be retirees because of the ridiculous tax concessions for both super and the personal tax brackets of the elderly.

        Low income low wealth – you’re not going to have many shares anyway so it won’t matter. You might lose a couple of hundred dollars but you will “win” much more in government services. High income high wealth – you’re going to be in a tax bracket so you’re not getting a franking credit cash refund anyway. It’s just the low income high wealth people that will be affected.

        There’s going to be some really interesting discussions ahead when the population learns that high income and rich are not quite the same.

      • “Low income low wealth – you’re not going to have many shares anyway so it won’t matter. You might lose a couple of hundred dollars but you will “win” much more in government services”

        Exactly, Tom.

        The problem with the poor is not that they pay too much tax. The problem is that they are poor.

    • Let’s not forget Labor’s attack on LEGITIMATE work expense tax claims.

      So, not only do you have to buy that widget to earn a living, Labor want you to pay tax on it too.

      The workers party died in about 2000 imo. Time they were buried so we can move forward.

    • What cracks me up is hearing the ones who are affected and object to the stereotyping that all the receivers are multi millionaires who just throw the money into the pile yet they happily class all unemployed people as lazy drug addicts who don’t deserve the money that comes out of their taxes. It’s an absolute hoot.

  4. Turnbull’s problem. apart from the fact that, as predicted, a lawyer/banker from the Eastern suburbs of Sydney was the last type of leader Australia needed, is that he has become a talking head. His mouth flaps but no sound comes out – at least as far as the general population is concerned. Turnbull actually believes in nothing.
    The Treasurer Morrison has been starkly revealed to be a piece of BS who believes in nothing.
    This has all become pretty much obvious to the general population.

    Will it be better under a CFMEU dominated government led by a weak crook like Shorten? Bwahahaaaaaa!

    Note: There is a TOTAL absence of the facts of the Macro situation around here. The whole inter-generational war thing completely misses the point of what is wrong and the policies that will result from that will the those that make the real problems we have a whole lot worse.
    Politics might be fun but I didn’t realise that was the purpose of this site?

    • We need a dictator for a couple of generations.

      These party’s only serve themselves. We’ve seen it for decades.

      It’s seriously time for a coordinated voting plan to get rid of LNP and Labor.

      • The ruling parties aren’t interested in, or representing, the will of the people, therefore we should move further away from that by installing a dictator. That’s probably not going to turn out as well as you’d like it to.

      • Footsore

        Probably not, but it’s getting pretty frustrating watching LNP and Labor operate for everyone but Australians. We need change.

      • A dictator OR a Bernie Sanders type … either extreme should lead to a necessary reset.

        Dicking around with policy will do f*all. We need a clean slate and a small State. People will soon discover that sitting on their fat ar$es isn’t an option anymore. Will solve the obesity crisis overnight too.

  5. Too bad only 30% of Australians will ever vote Labor again.

    Their brand is broken, and will take far more than policies the bogans that used to vote Labor won’t understand anyway.

    Labor’s betrayed Australians. You can’t undo that.

    • I came up with this little ditty, it is a work in progress:

      There once was a man named, Ric
      Who loved to suck on Hanson’s big d!ck
      Lathering it from tip to tail
      He worked his tongue like a flail…

      It was not a big d!ck he exclaimed
      She is in fact a She he complained
      No sight, nor sound was there of a prick
      An assertion held true by dear Ol Ric

      How do you know this said I?
      Cuz I have seen It, with my very own eye
      A thing to marvel, continued Ol Ric
      Something so yum, lickity lick

      • nice ditty. You know I’m right. Labor have done irreparable damage to their party and therefore Australia. We don’t have a viable option to LNP. It probably can’t be fixed.

        Labor need to describe to Australia what they’ve done wrong, what they’re doing to ensure it never happens again, or no more than 30% of us are voting for them.

      • The marginal Greens/Labor voter have made Labor make ridiculous decisions to keep the vote.

        Like I’ve always said, inner city left voters are to blame for every problem Australia has. They’ve wrecked Labor and given us LNP for two terms.

        There’s no way in the world, Labor will win majority government next term.

      • @Ric
        Yes, yes, but what about the ditty? Does it need work? Hit me with an out of 10.

      • I’m going to give you a 7 today.

        It does need some work, but it’s pretty good. If you could fit a line about how horrible LNP and Labor are for our kids futures we could revise up to an 8 or 9.

      • Well, that went better than I expected. I always get nervous when I put my creative self out there, it’s nice to be rewarded with such a thoughtful critique. Will be sure to take your suggestions into consideration, though, don’t be offended if they’re not added.

      • The marginal Greens/Labor voter have made Labor make ridiculous decisions to keep the vote.

        LOL.

        Labor’s ridiculous decisions for the last twenty-odd years have come from galloping off to the right chasing Coalition voters (and lobbyists).

      • lol

        One ridiculous action doesn’t make the other one right. Inappropriate lol, doesn’t fit.

        Come back to the centre, drop big Australia and Labor govern for 50 years.

        Don’t, and we’re all in trouble.

      • Ric,

        Labor are Labor, Liberal are Liberal and The Greens are The Greens. Since that is the case, how can The Greens be responsible for anything that Labor have undertaken. I brought the Liberal Party in because you often blame other parties for their decisions and short comings.

      • drsmithyMEMBER

        Since that is the case, how can The Greens be responsible for anything that Labor have undertaken.

        See, your problem is you’ve got your logic arse-about-face.

        The Greens are responsible. The Greens are always responsible. Doesn’t matter if it’s North Korea’s nuclear ambitions or your dog’s nasty farts.

        Now, what ridiculous assumptions and convoluted chains of reasoning are needed to connect the known fact that the Greens being responsible, back to the problem ? Wait, what was the problem again ?

        😀

      • footsore

        You’re right. It’s Greens voters that are causing the destruction of Australia.

        The utopian rubbish you vote for doesn’t exist. Every one of their policies conflict with one another.

      • Ric,

        The Greens are yet to govern, so how can those who voted for a party who hasn’t governed be more responsible than either the Coalition or Labor parties?

      • footsore

        You know full well why. Labor’s competing for Greens votes, so they’ve had to move left. That’s well established. It’s why Labor’s now only getting 30% of the vote. It’s why we have an LNP government.

      • Ric,

        You claim that the Labor Party has abandoned the working class, which is the class that any left party would represent. So how has it moved left and abandoned the working class at the same time? And, again if the Labor party has done either of these things how are groups outside of the Labor Party, like The Greens or those who preference Greens above Labor, in any way responsible for the actions of the Labor Party? Only the Labor Party is responsible for the doings of the Labor party.

      • footsore

        Now I am confused.

        So who destroyed the Democrats ??

        How can the Democrats be responsible for anything that the LNP have undertaken ? LNP policy for a GST under Howard.

        Was it Democrat leader Meg Lees ? or LNP PM John Howard ?? The Democrats’ slogan to “Keep the Bastards honest ” rang true for many.

        The Democrats were judged to be the ‘traitors’ and are now no more.

    • MediocritasMEMBER

      From the article:

      These are tax credits attached to dividends of Australian-listed companies where shareholders can claim a cash refund from the Tax Office if the value of the tax credits exceeds the shareholder’s tax liabilities.

      “We were encouraged by successive governments during our working life to set aside for our retirement and not become an added burden on the economy by accessing the age pension,” Margaret said.

      So she’s receiving cash payments from the government [credits] and she thinks that’s OK because she’s not receiving cash payments from the government [pension]…..err, okay.

  6. Placeholder for Ric and his anti-labor comment to follow. I think we found another paid shrill guys. At least try to act impartial lol.

    • “think we found another paid shrill guys. At least try to act impartial lol”

      Seriously? Your lack of comprehension skill does not make me a paid shrill. We’ve got stinking LNP BECAUSE Australia won’t vote Labor. I’ve been very clear about that.

    • If you understood my post about losing tax return on work expenses you’d know I’m a worker. I have never voted LNP. Ever. I’d like to vote Labor to care for working Australians but they’ve divested their interests to the inner city wealthy left.

      I’m angry Labor betrayed Australian workers. I can’t see how you’ve misinterpreted that.

    • Bob Carr as Labor leader is their solution and guaranteed government. Australia desperately wants it.

    • I like Shorten. He seems like a nice guy, but he is the figure head that’s left from the Rudd/Gillard/Rudd era. Australia doesn’t trust him. How’s when LNP used his dance to discredit him. That dance is endearing to most I would guess. I love it. That’s how removed LNP are from Australians yet they’re running the place again.

      https://m.youtube.com/watch?v=DP5SpcOhc0E

  7. I like Labor’s dividend imputation changes but I suspect they will lose Batman convincingly to The Greens and Bill will back pedal and dilute his policy so far and so fast it will be effectively neutered, if it is not scrapped.
    The problem with these big Costello handouts is that they are almost impossible to unwind.

    • Until we have a nice healthy recession, or better, a full blown crash !
      Then a complete reset comes.
      As a society we’re to greedy & to stupid otherwise !

  8. I’ve been telling you this for some time: Shorten is a terrible retail politician, but he has a good policy brain and is a brilliant backroom operator. All substance and no style. He is almost the exact opposite of Malcolm Turnbull.

  9. You have Bowen and Leigh drivng ALPs economic narrative. Shorten is merely a puppet, still very much the hollow-man. Bowen should be leader and Leigh, Treasurer (although he’s a bit too Left for my tastes, he has a brain and could override his ideology).

    Cormann and particularly Porter have much to offer but stymied by TurnTrumps brain farts and inability to make hard (unpopular) decisions.

    Dump the leaders and give a coalition of Cormann Porter Bowen and Leigh a go. I think they’d nut out some decent policy if unbridled by politics. And you’d get the company tax cuts.

    • Cormann Porter Bowen and Leigh

      No thanks. All big Australia. No good change comes until that’s dropped.

  10. I think, labor has decided it does not want to be at the helm when the proverbial hits, hence they are being very bold and brash. Good on them, if they get in.. atleast they will say “we said we will do this and we have a mandate to do it.. and we knew economy would enter recession” … if they don’t get in…. “Liberal party was responsible for recession…. not good managers for two generations atleast” – done and dusted

  11. The franked dividends policy (or rather, payment of cash equivilant to anyone who hasn’t paid tax) is a both logical and long overdue. But how dumb is it to make an announcement in the last week before a tight-rope by-election and a tight-rope state election when there is no time to properly explain and sell it?? Just throw the policy out there as meat to the Hungary Libersl fogs and fodder for the 24hr news cycle whose sensationalist bent will tear it apart.

    It’s this sort of “shot yourself in the foot” stupidity that bothers me with Shorten. Good policy but dumb people.

    • Craig

      Bad policy is bad policy, so will not pass the pub test and you can only blame Shorten and LAB.

      Shorten using 2014/2015 tax data is fraudulent in this debate and the LAB party has been caught out.

      They should have targeted HNW SMSF but were too lazy or stupid to do their homework.

      See the excellent comments from Stitches above.