Academic journal article Social Alternatives

Austerity for Some: Tony Abbott's Economic Legacy

Academic journal article Social Alternatives

Austerity for Some: Tony Abbott's Economic Legacy

Article excerpt

Tony Abbott was the Australian Prime Minister for seven hundred and twenty-six days. Elected on a platform of fiscal consolidation, the first budget of the Abbott Government attempted sweeping cuts across a variety of portfolios - foreign aid, healthcare, education, public service, and welfare programs were all targeted. There was, however, an implicit feeling for many that these cuts had been applied unevenly, and as a result the budget was widely seen as 'unfair' (e.g. Gittens 2015). After the backlash against the 'overreach' of the first budget, the Abbott Government largely abandoned the 'budget emergency' narrative with the 2015-16 budget. This second budget pivoted to focus on encouraging everyone to 'have a go', through supply-side incentives. The second Abbott budget has even been labelled stimulatory - 'Suddenly, everybody's a Keynsian'1 (Coorey 2015) - which, if true, would signal a distinct departure from the 'austere' first budget. Despite this attempt at electoral appeasement, Abbott remained unpopular, ultimately culminating in a successful Liberal Party leadership challenge by Malcolm Turnbull on 15 September 2015. Turnbull was subsequently sworn in as the Prime Minister of Australia2.

Tony Abbott's short, controversial prime ministership, and the government he led, appear to leave in their wake a paradoxical legacy; some attempt must be made to understand and characterise this period. An early characterisation was provided by Lloyd and Ramsay, who argued that 'the current Abbott government ... has not just continued the neoliberal status quo but pushed it considerably further' (2015: 42). Yet the seemingly contradictory turns taken would appear to cast doubt on this interpretation of events. Was it an unpopular, but necessary, attempt at fiscal consolidation, an instance of 'supply-side' stimulus, or something else entirely? This article will consider these various narratives. In light of this examination, light will also be shone on the likelihood of significant policy change under Prime Minister Turnbull. The treatment of this second task will be brief and speculative, but the argument developed across the two questions will be this: there is truth in each of the aforementioned criticisms. The Abbott Government was austere in some ways, and profligate in others. The overarching explanation for this contradiction is to be found by looking at the distributive impact of the policies of the Abbott Government. This can indeed be understood through the lens of 'neoliberalism', though not in the way suggested by some commentators. The Abbott Government was not neoliberal in the sense that it was committed to free markets - it was neoliberal in the sense that it continued to facilitate the reassertion of the power of capital in the post-war context (see Harvey 2005). And, understanding the material reality of neoliberalism in this way, it is quite clear that any difference in a Turnbull-led government will be largely superficial, as a departure from hegemonic neoliberalism in Australia is unlikely to be found in some 'pragmatic centre'.

Budget emergency?

First, let us consider the idea that the Abbott Government was characterised by attempted fiscal consolidation. After being elected on a platform of fiscal responsibility, the 2014-15 budget was purportedly necessary to 'repair' the 'budgetary emergency' that the Coalition Government inherited from the Labor Party (Hockey 2014). This narrative is largely congruent with that of 'austerity'. Austerity is defined in this narrative as budgetary fiscal consolidation (cuts to social services) alongside other forms of deflation, in order to reduce sovereign debt and deficit, with the explicit aim of achieving surplus (Blyth 2013: 15). The correlation between the idea of austerity as necessary fiscal consolidation and Treasurer Joe Hockey's now-famous speech, 'The End of the Age of Entitlement' is quite clear:

We must rebuild fiscal discipline. Budget surpluses must be restored, ideally until the debt is repaid. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.