1 00:00:01,280 --> 00:00:04,400 S1: I'm Jacqueline Maley, and you're listening to Inside Politics from 2 00:00:04,400 --> 00:00:08,600 S1: the Age and The Sydney Morning Herald. This week we're 3 00:00:08,600 --> 00:00:11,559 S1: going to talk about the enormous global volatility the government 4 00:00:11,560 --> 00:00:14,600 S1: is dealing with, courtesy of the war on Iran and 5 00:00:14,600 --> 00:00:16,279 S1: whether or not we need to be worried about things 6 00:00:16,280 --> 00:00:19,360 S1: like our fuel supplies, amongst many other things, like the 7 00:00:19,360 --> 00:00:22,400 S1: interest rate rise that the reserve Bank handed down this week. 8 00:00:23,160 --> 00:00:26,079 S1: I am joined by my usual podcast pal, our chief 9 00:00:26,079 --> 00:00:29,400 S1: political correspondent, Paul Circle. Paul, welcome from Canberra. 10 00:00:29,840 --> 00:00:30,520 S2: Good morning Jack. 11 00:00:33,240 --> 00:00:36,640 S1: Paul, British Prime Minister Harold Macmillan liked to say that 12 00:00:36,640 --> 00:00:40,280 S1: events were the thing most likely to perturb prime ministers 13 00:00:40,280 --> 00:00:43,320 S1: and rock governments. And this week, the Albanese government is 14 00:00:43,320 --> 00:00:46,080 S1: dealing with a few of those. Let's start with the 15 00:00:46,080 --> 00:00:49,200 S1: Iran war. The strategic objectives of the war are still 16 00:00:49,200 --> 00:00:52,559 S1: very unclear from the US side, but the effects of 17 00:00:52,560 --> 00:00:55,880 S1: it are very evident on Australia as well as the 18 00:00:55,880 --> 00:00:58,640 S1: rest of the world. The Strait of Hormuz is effectively 19 00:00:58,640 --> 00:01:01,520 S1: closed for business and oil prices have gone up at 20 00:01:01,520 --> 00:01:05,720 S1: the time of recording. They're hovering about $100 a barrel, 21 00:01:05,720 --> 00:01:09,560 S1: us maybe a bit above. And in Australia, that means 22 00:01:09,560 --> 00:01:13,440 S1: higher petrol prices, higher diesel prices and warnings of flow 23 00:01:13,440 --> 00:01:16,080 S1: on effects for the price of food because of the 24 00:01:16,080 --> 00:01:19,400 S1: supply of fertiliser which might be threatened. What is the 25 00:01:19,400 --> 00:01:22,560 S1: government doing to deal with this potential crisis? Paul. 26 00:01:23,440 --> 00:01:26,160 S2: Yeah, it's a good point on on events knocking governments around. 27 00:01:26,160 --> 00:01:29,680 S2: This is the second event in the space of a 28 00:01:29,680 --> 00:01:33,480 S2: few months that's really jolted this government after Bondi in December, 29 00:01:33,520 --> 00:01:37,679 S2: really upended their summer planning and their preparation for the budget. Uh, 30 00:01:37,800 --> 00:01:40,720 S2: just when they moved on from that, they've been struck 31 00:01:40,720 --> 00:01:45,080 S2: by a huge international event that has, um, again, caused 32 00:01:45,120 --> 00:01:49,240 S2: re-evaluation of their plans and priorities and timings on things. Uh, 33 00:01:49,320 --> 00:01:52,880 S2: the last two weeks has been a really intense period 34 00:01:52,880 --> 00:01:57,200 S2: for the cabinet. There's been national security, uh, committee meetings 35 00:01:57,200 --> 00:02:01,320 S2: of cabinet nearly daily. And the main response from the 36 00:02:01,450 --> 00:02:05,570 S2: government has been some pretty speedy changes to our air 37 00:02:05,690 --> 00:02:11,530 S2: fuel infrastructure. So the first decision was to release about 20% 38 00:02:11,530 --> 00:02:15,010 S2: from memory of our fuel reserves, which do not meet 39 00:02:15,010 --> 00:02:17,970 S2: international standards but are still quite significant. We've never tapped 40 00:02:17,970 --> 00:02:20,609 S2: into them before, and so that was an attempt to 41 00:02:20,650 --> 00:02:23,610 S2: calm down the sense of panic in the community to 42 00:02:23,650 --> 00:02:27,130 S2: say there is a stockpile. It is being pushed out 43 00:02:27,130 --> 00:02:30,609 S2: into the regions we see on Thursday morning. The IEC 44 00:02:30,650 --> 00:02:34,570 S2: is now taking action against all the major retailers because 45 00:02:34,570 --> 00:02:38,169 S2: of the lack of supply and increase in price in 46 00:02:38,169 --> 00:02:40,450 S2: the early days of this crisis. And the second thing 47 00:02:40,490 --> 00:02:46,290 S2: the government did was reduce the sulfur limits that are 48 00:02:46,290 --> 00:02:49,010 S2: allowed to be sold in fuel in Australia, which allows 49 00:02:49,169 --> 00:02:52,170 S2: dirtier fuel, which we'd previously blocked to come into the 50 00:02:52,169 --> 00:02:55,410 S2: country to also increase supply. And after about a couple 51 00:02:55,450 --> 00:02:58,170 S2: of weeks, the Prime Minister decided that a national cabinet 52 00:02:58,169 --> 00:02:59,370 S2: meeting was required. 53 00:02:59,690 --> 00:03:04,490 S3: Since the conflict Began a fortnight ago. My government has 54 00:03:04,530 --> 00:03:08,850 S3: been working to protect Australians from the effects of the 55 00:03:08,850 --> 00:03:13,410 S3: Middle East war. Today, the Commonwealth has appointed Anthea Harris, 56 00:03:13,410 --> 00:03:18,049 S3: who joins me here as the Fuel Supply Taskforce coordinator, 57 00:03:18,050 --> 00:03:21,250 S3: to support coordination across governments and sectors. 58 00:03:21,730 --> 00:03:25,010 S2: And supply chains are will be appointed to ensure that 59 00:03:25,010 --> 00:03:28,730 S2: not just fuel, but chemicals and plastics and fertilisers, which 60 00:03:28,889 --> 00:03:33,930 S2: could have serious effects on the construction, food, medical sectors 61 00:03:33,930 --> 00:03:36,970 S2: in coming weeks. If this conflict plays out to try 62 00:03:36,970 --> 00:03:40,570 S2: and get really quick coordination between states, industries, peak bodies 63 00:03:40,770 --> 00:03:43,210 S2: in a similar way that we saw during the Covid pandemic, 64 00:03:43,210 --> 00:03:46,050 S2: and some of the lessons there on speedy responses have 65 00:03:46,050 --> 00:03:48,090 S2: been enacted in the last couple of weeks. 66 00:03:48,290 --> 00:03:50,650 S1: I love I love the appointment of a czar. We 67 00:03:50,650 --> 00:03:53,490 S1: haven't had any czars appointed in Australia, I don't think ever. 68 00:03:53,690 --> 00:03:56,610 S1: Certainly not in my living memory. Um, but you know, 69 00:03:56,650 --> 00:03:59,850 S1: it's time. The coalition has criticised the Prime Minister and 70 00:03:59,850 --> 00:04:02,810 S1: his energy minister, Chris Bowen, for not responding fast enough 71 00:04:02,810 --> 00:04:05,250 S1: to the problem. Being blindsided or maybe not taking the 72 00:04:05,250 --> 00:04:08,490 S1: problem seriously. Chris Bond's been very much at pains to 73 00:04:08,650 --> 00:04:11,570 S1: reassure people that at the moment it's not a supply problem, 74 00:04:11,570 --> 00:04:14,130 S1: it's a demand problem. So people are basically panicking and 75 00:04:14,130 --> 00:04:17,690 S1: stockpiling petrol and diesel where they don't need to. Do 76 00:04:17,690 --> 00:04:20,010 S1: you think the criticism from the coalition is fair that 77 00:04:20,050 --> 00:04:22,050 S1: that this has blindsided them? They're a bit on the 78 00:04:22,050 --> 00:04:23,210 S1: back foot with this. 79 00:04:23,810 --> 00:04:26,849 S2: Yeah, I think if you look at the the coalition attack, 80 00:04:27,050 --> 00:04:30,849 S2: there's not a huge amount of detail on what measures 81 00:04:30,850 --> 00:04:34,330 S2: the government has taken that they disagree with or policies 82 00:04:34,330 --> 00:04:36,810 S2: that the coalition thinks the government should have proceeded with, 83 00:04:36,850 --> 00:04:40,010 S2: that Labour is not themselves done. It's a kind of 84 00:04:40,010 --> 00:04:42,330 S2: vibes based argument that the government was slow to take 85 00:04:42,330 --> 00:04:45,810 S2: this seriously, and the basis for that claim is that 86 00:04:45,810 --> 00:04:48,450 S2: in the first couple of days of the last sitting 87 00:04:48,450 --> 00:04:51,290 S2: week in Parliament, which was last week, on Monday and Tuesday, 88 00:04:51,570 --> 00:04:54,490 S2: you saw a few Labour ministers, Chris Bowen, being one 89 00:04:54,850 --> 00:04:59,890 S2: who were emphasising the right wing conspiratorial element of the 90 00:04:59,890 --> 00:05:04,170 S2: community sentiment, which is that Chiefly being put by one nation, 91 00:05:04,170 --> 00:05:06,970 S2: which was that fuel was not actually entering Australia. So 92 00:05:06,970 --> 00:05:08,810 S2: you saw Tim Ayres in the Senate and Chris Bowen 93 00:05:08,810 --> 00:05:10,849 S2: in the lower House, and in public comments from various 94 00:05:10,850 --> 00:05:14,010 S2: ministers dismissing this idea that there was no fuel coming 95 00:05:14,010 --> 00:05:17,330 S2: into Australia. I think one of the Labour members in 96 00:05:17,330 --> 00:05:20,170 S2: the upper house called the opposition tin foil hat, whereas 97 00:05:20,210 --> 00:05:22,570 S2: for pushing this claim and their right to say that 98 00:05:22,570 --> 00:05:25,289 S2: claim is wrong, fuel has been coming into the country 99 00:05:25,290 --> 00:05:28,169 S2: and the supply problem has not hit yet. But because 100 00:05:28,170 --> 00:05:30,250 S2: of the panic in the community and the huge increase 101 00:05:30,250 --> 00:05:35,330 S2: in demand, there were outages and shortages in certain parts 102 00:05:35,330 --> 00:05:38,610 S2: of regional Australia and in some outer metropolitan areas as well. 103 00:05:38,610 --> 00:05:41,810 S2: So there was a problem that the community could see 104 00:05:41,810 --> 00:05:44,330 S2: with their eyes when they rocked up to a servo, 105 00:05:44,730 --> 00:05:47,610 S2: and it took a few days for the government to 106 00:05:47,650 --> 00:05:49,730 S2: meet the community where it was. I think there's a 107 00:05:49,730 --> 00:05:53,130 S2: fair argument to that effect to just acknowledge that, yes, 108 00:05:53,170 --> 00:05:56,130 S2: while supply is still coming in, there was a problem 109 00:05:56,130 --> 00:05:59,650 S2: and the problem could get worse. So I think that 110 00:05:59,650 --> 00:06:06,500 S2: initial pugilistic, maybe tone deaf posture from the government allowed 111 00:06:06,500 --> 00:06:10,060 S2: the opposition. This talking point that labor was too focused 112 00:06:10,060 --> 00:06:14,060 S2: on the city's lack touch with regional and outer suburban voters, 113 00:06:14,339 --> 00:06:18,339 S2: and was not serious about an issue that was in 114 00:06:18,339 --> 00:06:22,900 S2: part caused by a long running concern about Australia's stockpiles, 115 00:06:22,900 --> 00:06:26,380 S2: which was which have not been boosted by either Labor 116 00:06:26,380 --> 00:06:27,460 S2: or Liberal governments. 117 00:06:27,500 --> 00:06:30,020 S1: Yeah. So I want to ask you about that in 118 00:06:30,060 --> 00:06:32,820 S1: a minute. I mean, I guess I feel this responsibility 119 00:06:32,820 --> 00:06:35,300 S1: as well. And, you know, in the media that although 120 00:06:35,339 --> 00:06:37,900 S1: we're reporting on it, we need to report on accurately. 121 00:06:37,900 --> 00:06:40,620 S1: And as you say, there is no supply problem at 122 00:06:40,620 --> 00:06:43,500 S1: the moment and there's no reason for people to be stockpiling. 123 00:06:43,820 --> 00:06:46,180 S1: So you don't want to sort of foment panic, but 124 00:06:46,180 --> 00:06:48,780 S1: at the same time. Yeah, it's an issue and it 125 00:06:48,779 --> 00:06:51,380 S1: doesn't look like it's going anywhere. It's impossible to see 126 00:06:51,420 --> 00:06:53,860 S1: an end to this war at this point. It might 127 00:06:53,860 --> 00:06:56,980 S1: come next week. It might really not. Questions are being 128 00:06:57,020 --> 00:07:00,220 S1: asked about Australia's resilience capability. So that is kind of, 129 00:07:00,500 --> 00:07:03,100 S1: you know, from an economic standpoint that means like how 130 00:07:03,100 --> 00:07:05,620 S1: much oil we have stockpiled, our ability to provide food 131 00:07:05,620 --> 00:07:09,580 S1: for ourselves. The supply chains get disrupted. Basically, our ability 132 00:07:09,580 --> 00:07:13,179 S1: to be self-sufficient as a nation, if global trade and 133 00:07:13,180 --> 00:07:16,260 S1: just global cooperation more generally were to break down. And 134 00:07:16,260 --> 00:07:18,739 S1: this is something that people on the sort of the 135 00:07:18,780 --> 00:07:21,660 S1: right wing have been talking about for quite a while, 136 00:07:21,700 --> 00:07:26,020 S1: people like Andrew Hastie about having sort of industrial sovereignty, 137 00:07:26,500 --> 00:07:29,780 S1: and some government ministers are now saying that the former 138 00:07:29,780 --> 00:07:33,140 S1: Liberal government under Scott Morrison, did a really bad job 139 00:07:33,140 --> 00:07:36,220 S1: at this, really bad job at resilience planning. And then, 140 00:07:36,220 --> 00:07:39,100 S1: of course, the coalition is saying, well, the Albanese government 141 00:07:39,100 --> 00:07:41,140 S1: doesn't seem to have a plan for it either. So 142 00:07:41,180 --> 00:07:44,860 S1: what can we sift through all of that blaming to 143 00:07:44,900 --> 00:07:45,900 S1: what is the truth? 144 00:07:46,620 --> 00:07:49,380 S2: Well, on the on the specific point of the fuel reserves, 145 00:07:49,380 --> 00:07:53,260 S2: which have been below international standards for a long time, 146 00:07:53,260 --> 00:07:57,100 S2: it's a bipartisan failing. And Chris Bowen has made the 147 00:07:57,100 --> 00:07:59,820 S2: point this year that Angus Taylor, when he was energy minister, 148 00:07:59,820 --> 00:08:03,700 S2: faced calls to increase the stockpile. Bill shorten had a 149 00:08:03,700 --> 00:08:06,460 S2: policy in the 2019 election, one of the many Bill 150 00:08:06,460 --> 00:08:10,780 S2: shorten policies that never came to life to drastically increase 151 00:08:10,780 --> 00:08:13,500 S2: the fuel stock. The coalition at the time opposed that 152 00:08:13,500 --> 00:08:16,780 S2: policy and said it would cost between 10 and $20 billion. 153 00:08:16,780 --> 00:08:19,780 S2: So again, this is one of those policies where in 154 00:08:19,780 --> 00:08:22,460 S2: a time of absolute crisis, it becomes apparent how how 155 00:08:22,740 --> 00:08:25,340 S2: necessary it is. But when you're out of crisis, you 156 00:08:25,340 --> 00:08:27,060 S2: look at that price tag and we're in a tight 157 00:08:27,060 --> 00:08:29,460 S2: fiscal position and you think, is it really worth it? 158 00:08:29,740 --> 00:08:33,860 S2: There were two interesting interventions, I thought on Wednesday from 159 00:08:33,860 --> 00:08:37,180 S2: Labour ministers on this question of national resilience. In the morning, 160 00:08:37,179 --> 00:08:38,939 S2: the Prime Minister, at a speech, I think it was 161 00:08:38,940 --> 00:08:42,140 S2: in Melbourne at a car dealers association, said that the 162 00:08:42,140 --> 00:08:46,220 S2: Hawke-keating reforms, you know, which so many commentators and more 163 00:08:46,220 --> 00:08:52,540 S2: old school politicians, uh, yearn for, were driven by a 164 00:08:52,540 --> 00:08:55,099 S2: sense that Australia needed to open up to the world, 165 00:08:55,300 --> 00:08:58,060 S2: that we were too insular, that the shackles needed to 166 00:08:58,059 --> 00:09:00,020 S2: be taken off the Australian economy. It was a time 167 00:09:00,059 --> 00:09:04,590 S2: of economic liberalism, free markets, Thatcher, Reagan, the Prime Minister 168 00:09:04,590 --> 00:09:10,230 S2: said that productivity and and economic security questions at this 169 00:09:10,230 --> 00:09:13,310 S2: moment require different solutions. He said, we're not in the 170 00:09:13,309 --> 00:09:14,350 S2: Hawke and Keating era. 171 00:09:14,630 --> 00:09:17,630 S1: Well, just the downside. Risks of open, open markets and 172 00:09:17,630 --> 00:09:20,390 S1: global trade are really showing themselves as that global order. 173 00:09:20,429 --> 00:09:22,630 S1: I mean, you need it's like any relationship. You need 174 00:09:22,670 --> 00:09:25,709 S1: trust and you need reliability for those systems to run. 175 00:09:25,710 --> 00:09:28,990 S1: And trust and reliability on the international stage is is 176 00:09:28,990 --> 00:09:31,310 S1: breaking down before our eyes, it seems. 177 00:09:31,950 --> 00:09:34,550 S2: Yeah. And I'll just on that point, just mention Tim Ayres, 178 00:09:34,590 --> 00:09:37,230 S2: the industry minister who's a former unionist, spoke at a 179 00:09:37,270 --> 00:09:40,910 S2: conference in Melbourne as well on Wednesday night and said 180 00:09:40,910 --> 00:09:45,590 S2: that this really three decade long push for efficiency, which 181 00:09:45,590 --> 00:09:49,150 S2: you saw exemplified in Australia over many decades by the 182 00:09:49,150 --> 00:09:54,390 S2: Productivity Commission, regularly suggesting that subsidies to industries like the 183 00:09:54,390 --> 00:09:58,310 S2: car industry were not worthy, that, you know, the production 184 00:09:58,309 --> 00:10:01,270 S2: of Australian metals and chemicals and fertilisers and all these 185 00:10:01,270 --> 00:10:04,310 S2: other things, because they're more expensive to make in Australia 186 00:10:04,309 --> 00:10:06,630 S2: than they are in China and other places are not 187 00:10:06,670 --> 00:10:10,550 S2: worthy of continuation. He said that that type of politics 188 00:10:10,550 --> 00:10:13,910 S2: is not fit for purpose, that industry policy in an 189 00:10:13,910 --> 00:10:16,510 S2: old school sense that we saw, you know, pre Hawke 190 00:10:16,550 --> 00:10:20,069 S2: and Keating was now back in vogue because there was, 191 00:10:20,070 --> 00:10:24,230 S2: in his view, a growing realization that Australian industry is 192 00:10:24,230 --> 00:10:27,790 S2: also critical for national security. So there's a tide change 193 00:10:27,950 --> 00:10:29,910 S2: and you'll still have economists say that that money's not 194 00:10:29,910 --> 00:10:32,550 S2: worth spending. So the tension won't go away. But there's 195 00:10:32,590 --> 00:10:34,750 S2: a change in thinking here. And as you say, it's 196 00:10:34,750 --> 00:10:38,990 S2: also put forward by liberals, including Andrew Hastie, who are not, um, 197 00:10:39,030 --> 00:10:40,390 S2: old school free market liberals. 198 00:10:40,429 --> 00:10:42,989 S1: Yeah. I just want to pivot to the home front 199 00:10:43,110 --> 00:10:45,870 S1: because we've got some action here too. On Tuesday, the 200 00:10:45,870 --> 00:10:48,510 S1: reserve Bank delivered pretty bad news to a lot of 201 00:10:48,510 --> 00:10:51,150 S1: people when it put up the cash rate to 4.1%. 202 00:10:51,390 --> 00:10:53,270 S1: And that's an interest rate rise that all the major 203 00:10:53,270 --> 00:10:55,790 S1: banks said they would pass on. It's bad news for 204 00:10:55,790 --> 00:10:58,069 S1: anyone with a mortgage, obviously, but it's also bad news 205 00:10:58,070 --> 00:11:02,309 S1: for the government because there is persistent criticism that inflation 206 00:11:02,309 --> 00:11:04,790 S1: is running high because the government is spending too much 207 00:11:04,790 --> 00:11:07,790 S1: public money and basically pumping the economy full of too 208 00:11:07,790 --> 00:11:12,390 S1: much money that it can't work through because of capacity constraints. 209 00:11:12,510 --> 00:11:16,230 S1: And the RBA governor, Michele Bullock, also didn't rule out 210 00:11:16,230 --> 00:11:18,830 S1: the prospect of recession. I mean, the headlines all sort 211 00:11:18,870 --> 00:11:20,910 S1: of said that she warned of the risk of recession. 212 00:11:21,270 --> 00:11:23,230 S1: I didn't quite see it as that. But she basically 213 00:11:23,230 --> 00:11:25,709 S1: conceded that it might happen and they would deal with 214 00:11:25,710 --> 00:11:28,469 S1: it if it did. What did Treasurer Jim Chalmers have 215 00:11:28,470 --> 00:11:30,830 S1: to say after that reserve Bank decision, which was a 216 00:11:30,830 --> 00:11:33,190 S1: bit of a sort of cream pie in his face? 217 00:11:34,110 --> 00:11:37,030 S2: Yeah, yeah, I think you're right on the reading of Bullock. 218 00:11:37,030 --> 00:11:39,390 S2: She didn't explicitly go out to warn of a recession. 219 00:11:39,390 --> 00:11:41,870 S2: She was answering a question and she kind of said, 220 00:11:41,870 --> 00:11:45,030 S2: it's not in her control. Which which it isn't. Well, 221 00:11:45,030 --> 00:11:49,189 S2: at least not fully. Jim Chalmers is trying to prepare 222 00:11:49,190 --> 00:11:53,790 S2: for what is his biggest budget as treasurer. It's, I think, 223 00:11:53,790 --> 00:11:55,069 S2: his fourth. 224 00:11:55,270 --> 00:11:57,550 S1: Yeah. Which defies the numbers because they sort of they 225 00:11:57,590 --> 00:11:59,390 S1: gave us an extra budget in there. 226 00:12:00,110 --> 00:12:02,950 S2: Yeah. That's right. There's more budgets than there are years 227 00:12:02,950 --> 00:12:06,990 S2: of this government. That's right. And this this rate rise 228 00:12:06,990 --> 00:12:10,270 S2: comes at a critical time. Chalmers is trying to lay 229 00:12:10,270 --> 00:12:13,990 S2: the groundwork for a big tax reform budget. He is 230 00:12:13,990 --> 00:12:17,949 S2: looking at doing negative gearing, capital gains tax changes potentially 231 00:12:17,950 --> 00:12:21,429 S2: changes to trusts. They haven't landed on which formulation or 232 00:12:21,429 --> 00:12:24,350 S2: combination of these changes they'll put. But the IRC is 233 00:12:24,350 --> 00:12:27,350 S2: debating them as we speak. And if you look at 234 00:12:27,350 --> 00:12:30,590 S2: the last few weeks, as well as including the rate rise, 235 00:12:30,590 --> 00:12:35,430 S2: there's a there's a war on inflation might tick above 5%. 236 00:12:35,429 --> 00:12:38,470 S2: If you look at the most serious Treasury forecast that 237 00:12:38,470 --> 00:12:43,030 S2: Chalmers released on Thursday. So there's a new, much more 238 00:12:43,030 --> 00:12:47,910 S2: precarious economic environment that Anthony Albanese is confronting a more 239 00:12:47,910 --> 00:12:52,590 S2: fractious electorate, a dampening of of the already not very 240 00:12:53,150 --> 00:12:57,030 S2: enthusiastic mood among consumers. And so Chalmers is laying the 241 00:12:57,030 --> 00:12:59,270 S2: groundwork for a big reform budget where he wants to 242 00:12:59,270 --> 00:13:02,110 S2: try and rein in spending, which has been accused of 243 00:13:02,710 --> 00:13:05,600 S2: letting run rampant over the last four years, and he 244 00:13:05,600 --> 00:13:08,480 S2: also wants to do some major changes around intergenerational equity 245 00:13:08,480 --> 00:13:12,160 S2: and tax. The Prime Minister is famously pretty cautious about 246 00:13:12,160 --> 00:13:15,080 S2: putting big changes to the electorate. If there's a low, 247 00:13:15,120 --> 00:13:19,520 S2: lower inflation environment, no war going on, you might assume 248 00:13:19,520 --> 00:13:22,800 S2: that's a more palatable time to put some big changes 249 00:13:23,080 --> 00:13:25,800 S2: to the electorate to make the case. But Chalmers on 250 00:13:25,800 --> 00:13:28,079 S2: Sunday made a really interesting comment. He said the new 251 00:13:28,080 --> 00:13:32,480 S2: international environment, the prospect of higher rates means that only 252 00:13:32,480 --> 00:13:36,160 S2: gives us more impetus to act. We need to make savings. 253 00:13:36,280 --> 00:13:38,440 S2: We need to make big changes to get the economy 254 00:13:38,440 --> 00:13:41,440 S2: fit for purpose. So effectively the message from Chalmers to 255 00:13:41,480 --> 00:13:44,079 S2: the PM is don't let all this scare you off. 256 00:13:44,360 --> 00:13:48,040 S2: Let this drive even an even stronger reform appetite. 257 00:13:48,080 --> 00:13:51,440 S1: Yeah. So that I mean, that's really interesting because as 258 00:13:51,440 --> 00:13:53,959 S1: you say, it's kind of counterintuitive when everything is so 259 00:13:53,960 --> 00:13:56,440 S1: crazy globally. You might think, well, look, we just won't 260 00:13:56,679 --> 00:13:59,600 S1: change the settings very much. But Chalmers is basically, I'm 261 00:13:59,600 --> 00:14:02,120 S1: not going to waste this crisis. I'm going to, um, 262 00:14:02,240 --> 00:14:04,679 S1: use it to, to cut the budget and also to 263 00:14:04,720 --> 00:14:07,600 S1: push through these reforms that I want. I just wonder, 264 00:14:07,640 --> 00:14:10,800 S1: I mean, so much of the pre-budget reporting and all 265 00:14:10,840 --> 00:14:13,160 S1: these speeches that they roll out like Chalmers has got 266 00:14:13,160 --> 00:14:16,080 S1: an important pre-budget speech he's giving today on Thursday, as 267 00:14:16,080 --> 00:14:20,360 S1: we record. How much of it is sort of like messaging? Well, 268 00:14:20,400 --> 00:14:23,400 S1: so it's all messaging, but we might also call that 269 00:14:23,400 --> 00:14:26,520 S1: government spin. We might also say that, you know, Jim Chalmers, 270 00:14:26,520 --> 00:14:28,720 S1: it's very much in his interest to position himself as 271 00:14:28,720 --> 00:14:30,520 S1: someone who's going to be tough and he's going to 272 00:14:30,520 --> 00:14:34,240 S1: make tough decisions and, you know, cut spending because Labor's 273 00:14:34,240 --> 00:14:37,440 S1: big economic vulnerability is that they have been spending too much. 274 00:14:38,400 --> 00:14:43,200 S2: Totally. But I think having now embedded this message so 275 00:14:43,200 --> 00:14:46,480 S2: firmly in the public mind that this will be finally 276 00:14:46,800 --> 00:14:50,280 S2: a truly frugal budget, ministers are getting lots of requests 277 00:14:50,320 --> 00:14:52,600 S2: knocked back at IRC. They say they've never faced a 278 00:14:52,600 --> 00:14:57,760 S2: process that's been so restrictive. Having said that argument up, 279 00:14:57,960 --> 00:15:00,760 S2: if the government doesn't match match up to it, they'll 280 00:15:00,760 --> 00:15:04,640 S2: face severe criticism. So you would think that Chalmers is 281 00:15:04,640 --> 00:15:07,040 S2: only making these arguments because he knows the path the 282 00:15:07,040 --> 00:15:09,680 S2: government is going down. But the extent to which he 283 00:15:09,680 --> 00:15:12,040 S2: delivers will be only be able to be judged on 284 00:15:12,040 --> 00:15:12,360 S2: the day. 285 00:15:12,400 --> 00:15:14,960 S1: Yeah, yeah, it's going to be really interesting budget in 286 00:15:15,000 --> 00:15:16,880 S1: that sense, because they're not going to be able to 287 00:15:16,880 --> 00:15:20,000 S1: give away many goodies, even the rollbacks in tax cuts 288 00:15:20,000 --> 00:15:21,880 S1: that they're going to make. So they'll, you know, be 289 00:15:21,920 --> 00:15:25,080 S1: be adding to government revenue if they cut the capital 290 00:15:25,080 --> 00:15:28,680 S1: gains tax discount, for example. That's the coalition is going 291 00:15:28,720 --> 00:15:30,520 S1: to come back and say, well, you're just adding to 292 00:15:30,520 --> 00:15:33,400 S1: the tax burden of Australians. You're putting up taxes and 293 00:15:33,400 --> 00:15:35,240 S1: they're not going to be able to say, yes, we're 294 00:15:35,280 --> 00:15:37,840 S1: you know, we're cutting this tax perk, but we're recycling 295 00:15:37,840 --> 00:15:40,640 S1: it back to the broader community through income tax cuts, 296 00:15:40,640 --> 00:15:42,840 S1: which is what they've been able to do in the past. 297 00:15:43,560 --> 00:15:45,920 S1: I do want to ask you about the coalition. So 298 00:15:46,240 --> 00:15:48,640 S1: how is the coalition sort of showing up in all 299 00:15:48,680 --> 00:15:51,640 S1: of this? We haven't really checked in on Opposition Leader 300 00:15:52,200 --> 00:15:55,760 S1: Angus Taylor since he won the leadership a few weeks ago. 301 00:15:56,080 --> 00:15:58,480 S1: How is he sort of able to cut through with 302 00:15:58,520 --> 00:16:00,560 S1: this when there's so much noise? How do you think 303 00:16:00,560 --> 00:16:02,160 S1: he's going in his communication? 304 00:16:02,840 --> 00:16:06,970 S2: Well, on his communication, just firstly, he's he's been he 305 00:16:06,970 --> 00:16:09,810 S2: spent his first few weeks really in a in an 306 00:16:09,850 --> 00:16:13,530 S2: Abbott style mode of message repetition. He was far more 307 00:16:13,530 --> 00:16:17,130 S2: slogan driven than we saw under his predecessor, Sussan Ley, 308 00:16:17,170 --> 00:16:19,890 S2: and his key message was The Liberal Party is here 309 00:16:19,890 --> 00:16:23,930 S2: to restore living standards and protect Australia's way of life. 310 00:16:24,090 --> 00:16:26,450 S4: And my top priority as a new leader and Jane's 311 00:16:26,450 --> 00:16:29,810 S4: as well, is to protect Australians way of life and 312 00:16:29,810 --> 00:16:31,850 S4: to restore their standard of living. 313 00:16:32,170 --> 00:16:35,530 S2: And the latter being a reference to Islamic extremism. The 314 00:16:35,530 --> 00:16:39,490 S2: ISIS brides bolstering security settings post Bondi and the former 315 00:16:39,490 --> 00:16:43,530 S2: being a reference to bringing inflation down and growing real 316 00:16:43,530 --> 00:16:47,210 S2: living standards. In the last week, he's been a little bit, uh, 317 00:16:47,290 --> 00:16:49,330 S2: a little bit out of the national debate because he's 318 00:16:49,330 --> 00:16:53,010 S2: super focused on the by election. This is not really 319 00:16:53,010 --> 00:16:56,530 S2: become a major national talking point yet, but it's occurring 320 00:16:56,530 --> 00:16:59,930 S2: on May the 9th, I believe, and everybody in the 321 00:16:59,930 --> 00:17:03,210 S2: Liberal Party knows that it's really, really important that the 322 00:17:03,210 --> 00:17:06,570 S2: Liberals have a decent showing there if they're totally gazumped 323 00:17:06,570 --> 00:17:10,649 S2: by one nation, it will be a humiliating exemplification of 324 00:17:10,650 --> 00:17:13,929 S2: where the party's at. Um, the nationals also had a 325 00:17:13,930 --> 00:17:17,330 S2: leadership change last week. And on the question of where 326 00:17:17,330 --> 00:17:19,609 S2: Taylor goes next, there's a debate going on inside the 327 00:17:19,609 --> 00:17:23,410 S2: coalition about the extent to which he leads the opposition's 328 00:17:23,410 --> 00:17:27,449 S2: arguments in against the government on their handling of the 329 00:17:27,450 --> 00:17:30,449 S2: fuel crisis. Some are keen, some in the coalition are 330 00:17:30,490 --> 00:17:33,250 S2: keen to turn this into a Covid style. I don't 331 00:17:33,250 --> 00:17:35,490 S2: hold a hose moment for Albanese, though. There's clearly no 332 00:17:35,490 --> 00:17:37,610 S2: trigger for that yet, but they are keen to put 333 00:17:37,609 --> 00:17:40,250 S2: as much pressure on the government for its response as possible. 334 00:17:40,410 --> 00:17:43,209 S2: Given how long this might drag out for, but Taylor 335 00:17:43,210 --> 00:17:45,850 S2: spent the first days of this week in Farah and 336 00:17:45,890 --> 00:17:49,490 S2: hasn't really been putting huge pressure on Labour over the 337 00:17:49,490 --> 00:17:52,210 S2: fuel issue. But that might ramp up, particularly if we 338 00:17:52,210 --> 00:17:55,649 S2: start seeing shortages in key industries and if this drags 339 00:17:55,650 --> 00:17:58,770 S2: on for longer, and if there's any mistake or opening 340 00:17:58,770 --> 00:18:00,930 S2: for the coalition to to weaponise. 341 00:18:00,970 --> 00:18:03,690 S1: Yeah, there haven't really been very many sharp attacks. Like 342 00:18:03,730 --> 00:18:06,010 S1: I think they've struggled to get a handle on it. 343 00:18:06,090 --> 00:18:09,129 S1: The members of the opposition that I've seen or heard 344 00:18:09,290 --> 00:18:11,970 S1: criticizing the government, it seemed very diffuse terms. It's sort 345 00:18:11,970 --> 00:18:14,050 S1: of like, you know, they're not good at handling energy, 346 00:18:14,050 --> 00:18:16,570 S1: they're not good at handling the economy, but they haven't 347 00:18:16,609 --> 00:18:18,770 S1: actually said, as you made the point earlier, like, this 348 00:18:18,770 --> 00:18:20,850 S1: is what they should have done that they haven't done. 349 00:18:21,450 --> 00:18:24,210 S1: So they're grappling with that a bit. And also, I mean, 350 00:18:24,250 --> 00:18:29,330 S1: farrahs interesting. Like normally by elections are referendums on the government. Right. 351 00:18:29,330 --> 00:18:31,970 S1: And the government's like Labor's sitting this one out. So 352 00:18:32,010 --> 00:18:35,450 S1: it's really a referendum on the Liberal Party. And the 353 00:18:35,450 --> 00:18:37,850 S1: only polling that I've seen, which was really early from 354 00:18:37,850 --> 00:18:40,609 S1: the Australia Institute, was just between, I think it was 355 00:18:41,050 --> 00:18:43,889 S1: testing the waters between the independent candidate who's sort of 356 00:18:43,890 --> 00:18:47,410 S1: like a community independent and the One Nation candidate. And 357 00:18:47,410 --> 00:18:50,010 S1: I think they had the One Nation candidate nudged slightly ahead. 358 00:18:50,010 --> 00:18:53,370 S1: But other people have been saying it's more likely to 359 00:18:53,410 --> 00:18:56,250 S1: come down to a competition between the community independent and 360 00:18:56,850 --> 00:18:59,770 S1: the Liberal candidate. I mean, do you have any skinny 361 00:18:59,770 --> 00:19:00,450 S1: on that? Yeah. 362 00:19:00,890 --> 00:19:04,090 S2: The sense among the parties involved is that it's likely 363 00:19:04,090 --> 00:19:07,330 S2: to be between the One Nation candidate and the independent. Yeah. 364 00:19:07,369 --> 00:19:10,490 S2: If the Liberal Party candidate can bump up into second 365 00:19:10,490 --> 00:19:13,850 S2: or just behind second place, they're expected to have stronger 366 00:19:13,850 --> 00:19:16,489 S2: preference flows from the other candidates. I think the the 367 00:19:16,490 --> 00:19:18,810 S2: big concern and unknown about One Nation at this stage, 368 00:19:18,810 --> 00:19:21,409 S2: and it will be explained to some extent in the 369 00:19:21,410 --> 00:19:24,050 S2: South Australian election, which is on Saturday, is how well 370 00:19:24,050 --> 00:19:26,609 S2: they go on preferences. Yeah, they might have decent primary 371 00:19:26,650 --> 00:19:28,850 S2: votes in a number of seats, but if they preference, 372 00:19:28,850 --> 00:19:31,409 S2: if they only draw, you know, 20, 30, 40% of 373 00:19:31,410 --> 00:19:34,770 S2: liberal preferences and not many from other parties, they may 374 00:19:34,770 --> 00:19:37,250 S2: fall short in some seats. So yeah, it'll be fascinating 375 00:19:37,250 --> 00:19:39,369 S2: to see how it plays out. The climate 200 independent 376 00:19:39,369 --> 00:19:41,649 S2: in Fara has been in the in the field for 377 00:19:41,650 --> 00:19:44,050 S2: weeks and weeks longer than anybody else. They've got a 378 00:19:44,090 --> 00:19:46,290 S2: lot of money and they're a well known community member. 379 00:19:46,290 --> 00:19:49,970 S2: Michelle Milthorpe is her name. The One Nation candidate told 380 00:19:50,530 --> 00:19:53,490 S2: our newspaper last week that he's having, you know, tens 381 00:19:53,490 --> 00:19:56,169 S2: of thousands of dollars flow in from Toorak and Woollahra 382 00:19:56,369 --> 00:19:59,050 S2: with people fed up with the liberals and the libs 383 00:19:59,050 --> 00:20:01,170 S2: and Nats look like they were on their on their 384 00:20:01,210 --> 00:20:03,170 S2: heels and pretty late to get into the race, which 385 00:20:03,170 --> 00:20:06,090 S2: is a sign of the lack of organisation and decisiveness 386 00:20:06,130 --> 00:20:07,540 S2: in those parties at the moment. 387 00:20:07,580 --> 00:20:10,459 S1: Yeah, it's going to be really, really interesting by election, 388 00:20:10,460 --> 00:20:14,540 S1: even for people who are not usually interested in by elections. Paul, 389 00:20:14,540 --> 00:20:17,859 S1: that was fun. There's a lot of anxiety, I think, 390 00:20:17,859 --> 00:20:20,660 S1: in the community about all of this stuff. So, you know, 391 00:20:20,700 --> 00:20:23,060 S1: it's important that we put the facts out there and 392 00:20:23,100 --> 00:20:26,580 S1: this kind of robust analysis. Thank you very much. I 393 00:20:26,580 --> 00:20:27,780 S1: will see you next week. 394 00:20:27,780 --> 00:20:30,020 S2: Thank you. Sorry, I didn't have much good news to bring. 395 00:20:30,900 --> 00:20:33,660 S1: Maybe next week. Maybe everything will be much better next week. 396 00:20:34,060 --> 00:20:35,100 S2: One can only hope. 397 00:20:39,380 --> 00:20:41,500 S1: You can read all of our political news on our 398 00:20:41,500 --> 00:20:48,780 S1: websites theage.com.au or smh.com.au. Today's episode was produced by Kai Wong. 399 00:20:48,820 --> 00:20:51,940 S1: Our executive producer is Tammy Mills, and our podcasts are 400 00:20:51,940 --> 00:20:56,179 S1: overseen by Lisa Muxworthy and Tom McKendrick. Before you go, 401 00:20:56,180 --> 00:20:58,780 S1: follow Inside Politics and leave a review for us on 402 00:20:58,780 --> 00:21:02,220 S1: Apple or Spotify. I'm Jacqueline Maley, thank you for listening.