Mr Rudd and his Treasurer should be careful! The honeymoon period of making populist gestures, rhetorical statements and giving cash handouts is over!
The May Budget will undoubtedly contain some unpleasant cuts and Mr Rudd will have to start making unpopular decisions for the first time since he came to power in Nov 2007.
Mr Rudd may have won Government at a time when the longest global economic expansion came to a sudden and shuddering halt. But, in fact it is widely noted that in many ways this has turned out to be a massive and lucky political winning ace for him! It's allowed him to get on with his social rhetoric and populist statements, give cash handouts to bribe voters, jet set around the world and enjoy the grandiosity of being a world leader (a lot more than John Howard ever did in his 11 years may I add), and at the same time to blame all the major issues he needs to deal with (and keeps postponing) on the Howard Government's policies and the global financial crisis!
So far, we have not had a Prime Minister who has proven his leadership credentials! All we've had is an astute political operator who's enjoyed a very long honeymoon and used it in the cleverest populist way possible to make his electoral position stronger. (and in the world of politics this is a commendable achievement of course).
Let's just hope Mr Rudd has not started to believe his own speeches! (as Sir Humphrey points out in Yes Minister). Because what is ahead is not as easy to deal with as making populist gestures about issues that play with the electorates' emotions but do not subsequently require substantive policy!
The May Budget will be the first and clearest gauge of the calibre of Mr Rudd's leadership and political skills in dealing with adverse situations, as well as Mr Swan's future as the Treasurer and Mr Tanner's role as the danger man lurking in his shadows waiting for the first viable opportunity to pounce!
The Government inherited a $22b surplus and due to a variety of global financial factors, as well as its own policies, is now left with a very empty pocket, just as the May Budget is due to be presented!
And this is where the key issue lies!
Mr Rudd and Mr Swan must not be allowed to get away with blaming the deficit and any unpopular decisions contained in the Budget on the global financial downturn and the severity of the recession in our major trading partners such as Japan and the USA! They must be held accountable and give a detailed explanation of what they did with the $22b surplus they inherited when they won in November 2007, and to explain how they are going to save jobs with one dimentional policies such as direct cash hand outs!
I am involved in retailing and would be the first to acknowledge that unlike what the opposition mischiefously wants us to believe, the fiscal stimulus has had a reasonable positive effect on retail sales and has managed to maintain the consumer confidence so far. As a result, retailers in Australia are so far in a much better shape than in Japan, UK or the USA. For this, Mr Rudd and his Government must be applauded and the opposition simply ignored!
However, the stimulus could have and should have covered a much wider range of potential factors such as reduction in nonsensical taxes such as Payroll tax and other redtape in order to encourage businesses to keep jobs. On top of this Julia Gillard's job destroying new award system should have been shelved or at least delayed till 2012.
I guess all we can do at this stage is to wait for the May Budget night! I wonder if the TV viewing of the reading of the Budget and subsequent commentary and interviews on the night manages to break all previous rating records on Australian TV!!!
Well, when you think about the perilous position of the immediate economic well being of Australia and the real possibility of 7-8% unemployment in the near future, you'd think it should be the highest TV rating night of all time! :)
